Align Technology Inc. Contracts
Sample Business Contracts
Loan and Security Agreement - Align Technology Inc. and Comdisco Inc.
Loan Forms
LOAN AND SECURITY AGREEMENT
THIS AGREEMENT (the "Agreement"), dated as of April 12, 1999 is entered
into by and between Align Technology Inc., a Delaware corporation having a
principal place of business at 442 Potrero Ave., Sunnyvale, CA 94086 (the
"Borrower") and Comdisco, Inc., a Delaware corporation having a principal place
of business at 6111 North River Road, Rosemont, Illinois 60018 (the "Lender").
In consideration of the mutual agreements contained herein, the parties hereto
agree as follows:
WHEREAS, Borrower desires to borrow from the Lender hereunder the amount of
FIVE MILLION and 00/100 DOLLARS ($5,000,000.00) in minimum installments of ONE
MILLION and 00/100 DOLLARS ($1,000,000.00) each (as the same may from time to
time be amended, modified, supplemented or revised, the "Loan"), which would be
evidenced by Secured Promissory Notes(s) executed by Borrower substantially in
the form of Exhibit A hereto (as the same may from time to time be amended,
modified, supplemented or restated the "Note(s)").
NOW, THEREFORE, it is agreed:
SECTION 1. DEFINITIONS
Unless otherwise defined herein, the following capitalized terms shall have
the following meanings (such meanings being equally applicable to both the
singular and plural form of the terms defined):
1.1 "Account" means any "account," as such term is defined in Section 9106
of the UCC, now owned or hereafter acquired by Borrower or in which Borrower now
holds or hereafter acquires any interest and, in any event, shall include,
without limitation, all accounts receivable, book debts and other forms of
obligations (other than forms of obligations evidenced by Chattel Paper,
Documents or Instruments) now owned or hereafter received or acquired by or
belonging or owing to Borrower (including, without limitation, under any trade
name, style or division thereof) whether arising out of goods sold or services
rendered by Borrower or from any other transaction, whether or not the same
involves the sale of goods or services by Borrower (including, without
limitation, any such obligation which may be characterized as an account or
contract right under the UCC) and all of Borrower's rights in, to and under all
purchase orders or receipts now owned or hereafter acquired by it for goods or
services, and all of Borrower's rights to any goods represented by any of the
foregoing (including, without limitation, unpaid seller's rights of rescission,
replevin, reclamation and stoppage in transit and rights to returned, reclaimed
or repossessed goods), and all monies due or to become due to Borrower under all
purchase orders and contracts for the sale of goods or the performance of
services or both by Borrower (whether or not yet earned by performance on the
part of Borrower or in connection with any other transaction), now in existence
or hereafter occurring, including, without limitation, the right to receive the
proceeds of said purchase orders and contracts, and all collateral security and
guarantees of any kind given by any Person with respect to any of the foregoing.
1.2 "Account Debtor" means any "account debtor," as such term is defined
in Section 9105(1)(a) of the UCC.
Blanket Loan and Security Agr.
-1-
<PAGE>
1.3 "Advance" means each installment made by the Lender to Borrower
pursuant to the Loan to be evidenced by the Note(s) secured by the Collateral.
1.4 "Advance Date" means the funding date of any Advance of the Loan.
1.5. "Advance Request" means the request by Borrower for an Advance under
the Loan, each to be substantially in the form of Exhibit B attached hereto, as
submitted by Borrower to Lender from time to time.
1.6 "Chattel Paper" means any "chattel paper," as such term is defined in
Section 9105(l)(b) of the UCC, now owned or hereafter acquired by Borrower or in
which Borrower now holds or hereafter acquires any interest.
1.7 "Closing Date" means the date of this Agreement.
1.8 "Collateral" shall have the meaning assigned to such term in Section 3
of this Agreement.
1.9 "Commitment Amount" means Five Million Dollars ($5,000,000).
1.10 "Contracts" means all contracts, undertakings, franchise agreements or
other agreements (other than rights evidenced by Chattel Paper, Documents or
Instruments) in or under which Borrower may now or hereafter have any right,
title or interest, including, without limitation, with respect to an Account,
any agreement relating to the terms of payment or the terms of performance
thereof.
1.11 "Copyrights" means all of the following now owned or hereafter
acquired by Borrower or in which Borrower now holds or hereafter acquires any
interest: (i) all copyrights, whether registered or unregistered, held pursuant
to the laws of the United States, any State thereof or of any other country;
(ii) registrations, applications and recordings in the United States Copyright
Office or in any similar office or agency of the United States, any state
thereof or any other country; (iii) any continuations, renewals or extensions
thereof; and (iv) any registrations to be issued in any pending applications.
1.12 "Copyright License" means any written agreement granting any right to
use any Copyright or Copyright registration now owned or hereafter acquired by
Borrower or in which Borrower now holds or hereafter acquires any interest.
1.13 "Documents" means any "documents," as such term is defined in Section
9105(l)(f) of the UCC, now owned or hereafter acquired by Borrower or in which
Borrower now holds or hereafter acquires any interest.
1.14 "Equipment" means any "equipment," as such term is defined in Section
9109(2) of the UCC, now or hereafter owned or acquired by Borrower or in which
Borrower now holds or hereafter acquires any interest and any and all additions,
substitutions and replacements of any of the foregoing, wherever located,
together with all attachments, components, parts, equipment and accessories
installed thereon or affixed thereto.
Blanket Loan and Security Agr.
-2-
<PAGE>
1.15 "Facility Fee" means one percent (1.0%) of the principal amount of the
Loan, along with the due diligence, transaction, and legal expense fee in the
amount of $7,500.00, due at the Closing Date, less commitment fee in the amount
of $20,000.00 paid with check no. 7516.
1.16 "Fixtures" means any "fixtures", as such term is defined in Section
9313(1)(a) of the UCC, now or hereafter owned or acquired by Borrower or in
which Borrower now holds or hereafter acquires any interest and, now or
hereafter attached or affixed to or constituting a part of, or located in or
upon, real property wherever located, together with all right, title and
interest of Borrower in and to all extensions, improvements, betterments,
renewals, substitutes, and replacements of, and all additions and appurtenances
to any of the foregoing property, and all conversions of the security
constituted thereby, immediately upon any acquisition or release thereof or any
such conversion, as the case may be.
1.17 "General Intangibles" means any "general intangibles," as such term is
defined in Section 9106 of the UCC, now owned or hereafter acquired by Borrower
or in which Borrower now holds or hereafter acquires any interest and, in any
event, shall include, without limitation, all right, title and interest which
Borrower may now or hereafter have in or under any contract, all customer lists,
Copyrights, Trademarks, Patents, rights to Intellectual Property, interests in
partnerships, joint ventures and other business associations, Licenses, permits,
trade secrets, proprietary or confidential information, inventions (whether or
not patented or patentable), technical information, procedures, designs,
knowledge, know-how, software, data bases, data, skill, expertise, recipes,
experience, processes, models, drawings, materials and records, goodwill
(including, without limitation, the goodwill associated with any Trademark,
Trademark registration or Trademark licensed under any Trademark License),
claims in or under insurance policies, including unearned premiums,
uncertificated securities, cash and other forms of money or currency, deposit
accounts (including as defined in Section 9105(e) of the UCC), rights to sue for
past, present and future infringement of Copyrights, Trademarks and Patents,
rights to receive tax refunds and other payments and rights of indemnification.
1.18 "Instruments" means any "instrument," as such term is defined in
Section 9105(1)(i) of the UCC, now owned or hereafter acquired by Borrower or in
which Borrower now holds or hereafter acquires any interest.
1.19 "Intellectual Property" means all Copyrights, Trademarks, Patents,
rights to Intellectual Property, Licenses, trade secrets, source codes, customer
lists, proprietary or confidential information, inventions (whether or not
patented or patentable), technical information, procedures, designs, knowledge,
know-how, software, data bases, skill, expertise, experience, processes, models,
drawings, materials and records.
1.20 "Inventory" means any "inventory," as such term is defined in Section
9109(4) of the UCC, wherever located, now or hereafter owned or acquired by
Borrower or in which Borrower now holds or hereafter acquires any interest, and,
in any event, shall include, without limitation, all inventory, goods and other
personal property which are held by or on behalf of Borrower for sale or lease
or are furnished or are to be furnished under a contract of service or which
constitute raw materials, work in process or materials used or consumed or to be
used or consumed in Borrower's business, or the processing, packaging,
promotion, delivery or shipping of the same, and all furnished goods whether or
not such inventory is listed on any schedules, assignments or reports furnished
to Lender from time to time and whether or not the
Blanket Loan and Security Agr.
-3-
<PAGE>
same is in transit or in the constructive, actual or exclusive occupancy or
possession of Borrower or is held by Borrower or by others for Borrower's
account, including, without limitation, all goods covered by purchase orders and
contracts with suppliers and all goods billed and held by suppliers and all
inventory which may be located on premises of Borrower or of any carriers,
forwarding agents, truckers, warehousemen, vendors, selling agents or other
persons.
1.21 "License" means any Copyright License, Patent License, Trademark
License or other license of rights or interests now held or hereafter acquired
by Borrower or in which Borrower now holds or hereafter acquires any interest
and any renewals or extensions thereof.
1.22 "Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment for security, security interest, encumbrance, levy, lien or charge of
any kind, whether voluntarily incurred or arising by operation of law or
otherwise, against any property, any conditional sale or other title retention
agreement, any lease in the nature of a security interest, and the filing of any
financing statement (other than a precautionary financing statement with respect
to a lease that is not in the nature of a security interest) under the UCC or
comparable law of any jurisdiction.
1.23 "Material Adverse Effect" means a material adverse effect upon: (i)
the business, operations, properties, assets or financial conditions of
Borrower; or (ii) the ability of Borrower to perform, or of Lender to enforce,
the Secured Obligations.
1.24 "Maturity Date" means the date thirty six (36) months from the Advance
Date of each installment of the Loan.
1.25 "Patent License" means any written agreement granting any right with
respect to any invention on which a Patent is in existence now owned or
hereafter acquired by Borrower or in which Borrower now holds or hereafter
acquires any interest.
1.26 "Patents" means all of the following now owned or hereafter acquired
by Borrower or in which Borrower now holds or hereafter acquires any interest:
(a) letters patent of, or rights corresponding thereto in, the United States or
any other county, all registrations and recordings thereof, and all applications
for letters patent of, or rights corresponding thereto in the United States or
any other country, including, without limitation, registrations, recordings and
applications in the United States Patent and Trademark Office or in any similar
office or agency of the United States, any State thereof or any other country;
(b) all reissues, continuations, continuations-in-part or extensions thereof;
(c) all petty patents, divisionals, and patents of addition; and (d) all patents
to issue in any such applications.
1.27 "Permitted Liens" means:
(i) liens in favor of Lender;
(ii) liens securing the payment of taxes or other governmental
charges not yet delinquent or being contested in good faith by appropriate
proceeding, for which adequate reserves are maintained in accordance with
generally accepted accounting principles;
Blanket Loan and Security Agr.
-4-
<PAGE>
(iii) liens securing claims or demands of materialism, mechanics,
carriers, warehousemen, landlords and other like persons imposed without
action of such parties, provided that the payment thereof is not yet
required;
(iv) liens incurred or deposits made in the ordinary course of
Borrower's or a subsidiary's business in connection with workers
compensation, unemployment insurance, social security and other like laws;
(v) purchase money security interests in personal property
acquired after the date of this Agreement, provided such are limited to the
personal property so acquired and proceeds, thereof;
(vi) any liens existing as of the date hereof and specifically
disclosed by Borrower to Lender herein;
(vii) leases, subleases, licenses and sublicenses granted to
others in the ordinary course of business not interfering in any material
respect with the conduct of the business of any Borrower;
(viii) liens arising from judgments, decrees or attachments to the
extent and only so long as such judgment, decree or attachment as not
caused or resulted in a Event of Default;
(ix) liens in favor of customs and revenue authorities arising as
a matter of law to secure payment of customs duties in connection with the
importation of goods;
(x) liens which constitute rights of set-off of a customary
nature or bankers' liens with respect to amounts on deposit, whether
arising by operation of law or by contract, in connection with arrangements
entered into with banks in the ordinary course of business;
(xi) liens incurred in connection with the extension, renewal or
refinancing of the indebtedness secured by liens of the type described in
clause (vii) above, provided that any extensions, renewal or replacement
lien shall be limited to the property encumbered by the existing lien and
the principal amount of the indebtedness being extended, renewed or
refinanced does not increase.
1.28 "Proceeds" means "proceeds," as such term is defined in Section
9306(l) of the UCC and, in any event, shall include, without limitation, (a) any
and all Accounts, Chattel Paper, Instruments, cash or other forms of money or
currency or other proceeds payable to Borrower from time to time in respect of
the Collateral, (b) any and all proceeds of any insurance, indemnity, warranty
or guaranty payable to Borrower from time to time with respect to any of the
Collateral, (c) any and all payments (in any form whatsoever) made or due and
payable to Borrower from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Collateral by any governmental authority (or any Person acting under color of
governmental authority), (d) any claim of Borrower against third parties (i) for
past, present or future infringement of any Copyright, Patent or Patent License
or (ii) for past, present or future infringement or dilution of any Trademark or
Trademark License or for injury to the goodwill associated with any Trademark,
Blanket Loan and Security Agr.
-5-
<PAGE>
Trademark registration or Trademark licensed under any Trademark License and (e)
any and all other amounts from time to time paid or payable under or in
connection with any of the Collateral.
1.29 "Receivables" shall mean and include all of the Borrowers accounts,
instruments, documents, chattel paper and general intangibles whether secured or
unsecured, whether now existing or hereafter created or arising, and whether or
not specifically sold or assigned to Lender hereunder.
1.30 "Secured Obligations" shall mean and include all principal,
interest, fees, costs, or other liabilities or obligations for monetary amounts
owed by Borrower to Lender, whether due or to become due, matured or unmatured,
liquidated or unliquidated, contingent or non-contingent, and all covenants and
duties regarding such amounts, of any kind of nature, present or future, arising
under this Agreement, the Note(s), or any of the other Loan Documents, whether
or not evidenced by any Note(s), Agreement or other instrument, as the same may
from time to time be amended, modified, supplemented or restated.
1.31 "Trademark License" means any written agreement granting any right
to use any Trademark or Trademark registration now owned or hereafter acquired
by Borrower or in which Borrower now holds or hereafter acquires any interest.
1.32 "Trademarks" means any of the following now owned or hereafter
acquired by Borrower or in which Borrower now holds or hereafter acquires any
interest: (a) any and all trademarks, tradenames, corporate names, business
names, trade styles, service marks, logos, other source or business identifiers,
prints and labels on which any of the foregoing have appeared or appear, designs
and general intangibles of like nature, now existing or hereafter adopted or
acquired, all registrations and recordings thereof, and any applications in
connection therewith, including, without limitation, registrations, recordings
and applications in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof and (b) any reissues, extensions or
renewals thereof.
1.33 "UCC" shall mean the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of Illinois. Unless otherwise defined
herein, terms that are defined in the UCC and used herein shall have the
meanings given to them in the UCC.
1.34 "Warrant Agreement(s)" shall mean those agreements entered into in
connection with the Loan, substantially in the form attached hereto as Exhibit C
pursuant to which Borrower granted Lender the right to purchase 266,667 shares
of Series B Preferred Stock of Borrower at an Exercise Price of $3.00 per share
as more particularly set forth therein.
SECTION 2. THE LOAN
2.1 Subject to the terms and conditions set forth herein, Lender shall
make Loans to Borrower in an aggregate amount not to exceed the Commitment
Amount. Each Advance, together with interest at the rate of twelve percent (12%)
per annum, shall be payable in 36 monthly installments as set forth in the
Note(s).
Blanket Loan and Security Agr.
-6-
<PAGE>
2.2 Upon the occurrence of and during an Event of Default (as defined
herein), interest shall thereafter be calculated at a rate of five percent (5%)
in excess of the rate that would otherwise be applicable ("Default Rate"). All
such interest shall be due and payable in arrears, on the first day of the
following month.
2.3 Notwithstanding any provision in this Agreement, the Note(s), or
any other "Loan Document" (as defined herein), it is not the parties' intent to
contract for, charge or receive interest at a rate that is greater than the
maximum rate permissible by law which a court of competent jurisdiction shall
deem applicable hereto (which under the laws of the State of Illinois shall be
deemed to be the laws relating to permissible rates of interest on commercial
loans) (the "Maximum Rate"). If the Borrower actually pays Lender an amount of
interest, chargeable on the total aggregate principal Secured Obligations of
Borrower under this Agreement and the Note(s) (as said rate is calculated over a
period of time that is the longer of (i) the time from the date of this
Agreement through the maturity time as set forth on the Note(s), or (ii) the
entire period of time that any principal is outstanding on the Note(s)), which
amount of interest exceeds interest calculated at the Maximum Rate on said
principal chargeable over said period of time, then such excess interest
actually paid by Borrower shall be applied first, to the payment of principal
-----
outstanding on the Note(s); second, after all principal is repaid, to the
------
payment of Lender's out of pocket costs, expenses, and professional fees which
are owed by Borrower to Lender under this Agreement or the Loan Documents; and
third, after all principal, costs, expenses, and professional fees owed by
-----
Borrower to Lender are repaid, the excess (if any) shall be refunded to
Borrower.
2.4 In the event any interest is not paid when due hereunder,
delinquent interest shall be added to principal and shall bear interest on
interest, compounded at the rate set forth in Section 2.1.
2.5 Upon and during the continuation of an Event of Default hereunder
(as defined herein), all Secured Obligations, including principal, interest,
compounded interest, and reasonable professional fees, shall bear interest at a
rate per annum equal to the Default Rate.
2.6 Borrower shall have the option to prepay the Loan, in whole or in
part, without penalty or premium, after 12 months from the Closing Date by
paying the principal amount thereon together with all accrued and unpaid
interest with respect to such principal amount, as of the date of such
prepayment, without premium. In the event Borrower prepays the Note(s) within 12
months from the Closing Date hereof, Borrower shall pay the principal amount
together with all accrued and unpaid interest and a prepayment premium equal to
1% of the then outstanding principal amount ("the Prepayment Penalty"),
provided, however, in the event of an initial public offering of Borrower's
-------
stock, the Prepayment Penalty shall not apply.
2.7 If the Borrower has not repaid the outstanding principal amount
under the Loan in its entirety by the Maturity Date (as defined in the
applicable Note(s)), then for each additional month, or portion thereof,
thereafter that the outstanding principal is not paid, Lender shall have the
right to purchase from the Borrower, at the Exercise Price (adjusted, as set
forth and defined in the Warrant Agreement), an additional number of shares of
Preferred Stock (as defined in the Warrant Agreement) which number shall be
determined by (i) multiplying the outstanding principal amount which is due but
unpaid by 1% and (ii) dividing the product thereof by the Exercise Price.
Blanket Loan Security Agr.
-7-
<PAGE>
2.8 Notwithstanding anything in this Agreement to the contrary,
Lender's obligations to provide the Loan(s) shall terminate on the earlier of
(i) January 7, 2000 or (ii) the occurrence of a Material Adverse Effect pursuant
to Section 1.22, and no Advance Requests shall be accepted after such date,
unless otherwise waived by Lender ("Draw Period"). Notwithstanding the
foregoing, in the event the Borrower closes a private equity round for a minimum
of Ten Million and No/l00 Dollars ($l0,000,000.00) with a price per share no
less than $4.50 ("Next Round"), Borrower may request an extension of the Draw
Period for an additional nine (9) months ("Extended Draw Period"), such Extended
Draw Period will only be available upon: (i) written request by Borrower and
(ii) the issuance to Lender of a Series C Preferred Stock warrant for an
aggregate purchase price of $450,000 divided by the Exercise Price, with the
same terms and conditions as the Warrant Agreement defined herein and attached
hereto as Exhibit C. The Exercise Price shall be defined as equal to the price
per share of the Next Round.
SECTION 3. SECURITY INTEREST
As security for the prompt, complete and indefeasible payment when due
(whether at stated payment dates or otherwise) of all the Secured Obligations
and in order to induce Lender to make the Loan upon the terms and subject to the
conditions of the Note(s), Borrower hereby assigns, conveys, mortgages, pledges,
hypothecates and transfers to Lender for security purposes only, and hereby
grants to Lender a security interest in, all of Borrower's right, title and
interest in, to and under each of the following (all of which being hereinafter
collectively called the "Collateral"):
(a) All Receivables;
(b) All Equipment;
(c) All Fixtures;
(d) All General Intangibles;
(e) All Inventory;
(f) All other goods and personal property of Borrower whether
tangible or intangible and whether now or hereafter owned or
existing, leased, consigned by or to, or acquired by, Borrower
and wherever located; and
(g) To the extent not otherwise included, all Proceeds of each of the
foregoing and all accessions to, substitutions and replacements
for, and rents, profits and products of each of the foregoing.
Notwithstanding the foregoing, Lender agrees to release all Receivables
necessary for the sole purpose of Borrower securing an accounts
receivable/factoring facility against executed firm orders with Orthodontists
and Dentists for Borrower's dental products, provided, however, Lender has the
right of first refusal to provide such receivable/factoring facility.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF BORROWER
The Borrower represents, warrants and agrees that:
Blanket Loan and Security Agreement.
-8-
<PAGE>
4.1 it has good title in and to the Collateral, free of all liens,
security interests, encumbrances and claims whatsoever, except for the interest
of the Lender therein;
4.2 it has the full power and authority to, and does hereby grant and
convey to the Lender, a valid first priority perfected security interest in the
Collateral as security for the Secured Obligations, free of all liens, security
interests, encumbrances and claims, and shall execute such Uniform Commercial
Code financing statements in connection herewith as the Lender may reasonably
request. Except for Permitted Liens, no other lien, security interest, adverse
claim or encumbrance has been created by Borrower or is known by Borrower to
exist with respect to any Collateral;
4.3 it is a corporation duly organized, legally existing and in good
standing under the laws of the State of Delaware, and is duly qualified as a
foreign corporation in all jurisdictions where the failure to so qualify would
have a Material Adverse Effect on the Collateral or the business of the Borrower
taken as a whole;
4.4 the execution, delivery and performance of the Note(s), this
Agreement, the Warrant Agreement(s), and all financing statements, certificates
and other documents required to be delivered or executed in connection herewith
(collectively, the "Loan Documents") have been duly authorized by all necessary
corporate action of Borrower, the individual or individuals executing the Loan
Documents were duly authorized to do so, and the Loan Documents constitute
legal, valid and binding obligations of the Borrower, enforceable in accordance
with their respective terms, subject to applicable bankruptcy, insolvency,
reorganization or other similar laws generally affecting the enforcement of the
rights of creditors;
4.5 the Loan Documents do not and will not violate any provisions of
its Certificate of Incorporation, bylaws or any material contract pr agreement,
law, regulation, order, injunction, judgment, decree or writ to which the
Borrower is subject, or result in the creation or imposition of any lien,
security interest or other encumbrance upon the Collateral, other than those
created by this Agreement;
4.6 the execution, delivery and performance of the Loan Documents do
not require the consent or approval of any other person or entity including,
without limitation, any regulatory authority or governmental body of the United
States or any state thereof or any political subdivision of the United States or
any state thereof.
4.7 as of the date hereof no fact or condition exists that would (or
could, with the passage of time, the giving of notice, or both) constitute an
Event of Default under this Agreement or any of the Loan Documents and no event
which has had or could reasonably be expected to have a Material Adverse Effect
has occurred and is continuing.
SECTION 5. INSURANCE AND RISK OF LOSS
5.1 So long as there are any Secured Obligations outstanding,
Borrower shall cause to be carried and maintained commercial general liability
insurance against risks customarily insured against in Borrower's line of
business. Such risks shall include, without limitation, the risks of death,
bodily injury and property damage. So long as there are any Secured Obligations
outstanding, Borrower shall also cause to be carried and maintained insurance
Blanket Loan and Security Agr.
-9-
<PAGE>
upon the Collateral and Borrower's business, covering casualty, hazard and such
other property risks in amounts equal to the full replacement cost of the
Collateral. Borrower shall deliver to Lender lender's loss payable endorsements
(Form BFU 438 or equivalent) naming Lender as loss payee and additional insured.
Borrower shall use commercially reasonable efforts to cause all policies
evidencing such insurance to provide for at least thirty (30) days prior written
notice by the underwriter or insurance company to Lender in the event of
cancellation or expiration. Such policies shall be issued by such insurers and
in such amounts as are reasonably acceptable to Lender.
5.2 Borrower shall and does hereby indemnify and hold Lender, its agents
and shareholders harmless from and against any and all claims, costs, expenses,
damages and liabilities (including, without limitation, such claims, costs,
expenses, damages and liabilities based on liability in tort, including without
limitation, strict liability in tort), including reasonable attorneys' fees,
arising out of the disposition or utilization of the Collateral, other than
claims arising at or caused by Lender's gross negligence or willful misconduct.
SECTION 6. COVENANTS OF BORROWER
Borrower covenants and agrees as follows at all times while any of the
Secured Obligations remain outstanding:
6.1 Borrower shall furnish to Lender the financial statements listed
hereinafter, each prepared in accordance with generally accepted accounting
principles consistently applied (the "Financial Statements"):
(a) as soon as practicable (and in any event within thirty (30) days)
after the end of each month, unaudited interim financial statements as of
the end of such month (prepared on a consolidated and consolidating basis,
if applicable), including balance sheet and related statements of income
and cash flows accompanied by a report detailing any material contingencies
(including the commencement of any material litigation by or against
Borrower) or any other occurrence that could reasonably be expected to have
a Material Adverse Effect, all certified by Borrower's Chief Executive
Officer or Chief Financial Officer to be true and correct in all material
respects;
(b) as soon as practicable (and in any event within ninety (90) days)
after the end of each fiscal year, unqualified audited financial statements
as of the end of such year (prepared on a consolidated and consolidating
basis, if applicable), including balance sheet and related statements of
income and cash flows, and setting forth in comparative form the
corresponding figures for the preceding fiscal year, certified by a firm of
independent certified public accountants selected by Borrower and
reasonably acceptable to Lender, accompanied by any management report from
such accountants;
(c) promptly after the sending or filing thereof, as the case may be,
copies of any proxy statements, financial statements or reports which
Borrower has made available to its shareholders and copies of any regular,
periodic and special reports or registration statements which Borrower
files with the Securities and Exchange Commission or any governmental
authority which may be substituted therefor, or any national securities
exchange; and
Blanket Loan and Security Agr.
-10-
<PAGE>
(d) promptly, any additional information, financial or otherwise
(including, but not limited, to tax returns and names of principal
creditors) as Lender reasonably believes necessary to evaluate Borrower's
continuing ability to meet its financial obligations.
6.2 Borrower shall permit any authorized representative of Lender and its
attorneys and accountants on reasonable notice to inspect, examine and make
copies and abstracts of the books of account and records of Borrower at
reasonable times during normal business hours provided, that not more than two
such inspections or examinations shall take place in any calendar year except
upon the occurrence and continuation of an Event of Default. In addition, such
representative of Lender and its attorneys and accountants shall have the right
to meet with management and officers of the Company to discuss such books of
account and records.
6.3 Borrower will from time to time execute, deliver and file, alone or
with Lender, any financing statements, security agreements or other documents;
procure any instruments or documents as may be reasonably requested by Lender;
and take all further action that may be necessary or desirable, or that Lender
may reasonably request, to confirm, perfect, preserve and protect the security
interests intended to be granted hereby, and in addition, and for such purposes
only, Borrower hereby authorizes Lender to execute and deliver on behalf of
Borrower and to file such financing statements, security agreement and other
documents without the signature of Borrower either in Lender's name or in the
name of Borrower as agent and attorney-in-fact for Borrower. The parties agree
that a carbon, photographic or other reproduction of this Agreement shall be
sufficient as a financing statement and may be filed in any appropriate office
in lieu thereof.
6.4 Borrower shall protect and defend Borrower's title as well as the
interest of the Lender against all persons claiming any interest adverse to
Borrower or Lender and shall at all times keep the Collateral free and clear
from any legal process, liens or encumbrances whatsoever (except any placed
thereon by Lender and other Permitted Liens) and shall give Lender immediate
written notice thereof.
6.5 Without Lender's prior written consent, such consent to be given no
later than four (4) days after Lender receives notice by Borrower, Borrower
shall not, outside the ordinary course of business, but not to exceed $250,000,
(a) grant any material extension of the time of payment of any of the
Receivables, (b) to any material extent, compromise, compound or settle the same
for less than the full amount thereof, (c) release, wholly or partly, any person
liable for the payment thereof, or allow any credit or discount whatsoever
thereon other than trade discounts granted in the ordinary course of business of
Borrower.
6.6 Borrower shall maintain and protect its properties, assets and
facilities, including without limitation, its Equipment and Fixtures, in good
order and working repair and condition (taking into consideration ordinary wear
and tear) and from time to time make or cause to be made all necessary and
proper repairs, renewals and replacements thereto and shall competently manage
and care for its property in accordance with prudent industry practices.
6.7 Borrower shall not merge with and into any other entity; or sell or
convey all or substantially all of its assets or stock to any other person or
entity without notifying Lender a minimum of twenty (20) days prior to the
closing date and requesting Lender's consent to the assignment of all of
Borrower's Secured Obligations hereunder to the successor entity in form
Blanket Loan and Security Agr.
-11-
<PAGE>
and substance satisfactory to Lender. In the event Lender does not consent to
such assignment the parties agree Borrower shall prepay the Loan in accordance
with Section 2.6 hereof. Notwithstanding the foregoing, Lender hereby consents
to any Merger in which the surviving entity has cash and marketable securities
of at least ten (10) times the remaining Loan payments and Lender shall not
unreasonably withhold its consent to a Merger in other cases.
For purposes of this Agreement, a "Merger" shall mean any consolidation or
merger of the Borrower with or into any other corporation or entity, any sale or
conveyance of an or substantially all of the assets or stock of the Borrower by
or to any other person or entity in which Borrower is not the surviving entity.
6.8 Borrower shall not, without the prior written consent of Lender, such
consent not to be unreasonably withheld, declare or pay any cash dividend or
make a distribution on any class of stock, other than pursuant to employee
repurchase plans upon an employee's death or termination of employment or
transfer, sell, lease, lend or in any other manner convey any equitable,
beneficial or legal interest in any material portion of the assets of Borrower
(except inventory sold in the normal course of business).
6.9 Upon the request of Lender, Borrower shall, during business hours,
make the Inventory and Equipment available to Lender for inspection at the place
where it is normally located and shall make Borrower's log and maintenance
records pertaining to the Inventory and Equipment available to Lender for
inspection. Borrower shall take all action necessary to maintain such logs and
maintenance records in a correct and complete fashion.
6.10 Borrower covenants and agrees to pay when due, all taxes, fees or
other charges of any nature whatsoever (together with any related interest or
penalties) now or hereafter imposed or assessed against Borrower, Lender or the
Collateral or upon Borrower's ownership, possession, use, operation or
disposition thereof or upon Borrower's rents, receipts or earnings arising
therefrom. Borrower shall file on or before the due date therefor all personal
property tax returns in respect of the Collateral. Notwithstanding the
foregoing, Borrower may contest, in good faith and by appropriate proceedings,
taxes for which Borrower maintains adequate reserves therefor.
6.11 Borrower shall not relocate any item of the Collateral (other than
sale of inventory in the ordinary course of business) except: (i) with prior
written notice of the Lender not to be unreasonably withheld; and (ii) if such
relocation shall be within the continental United States. If permitted to
relocate Collateral pursuant to the foregoing sentence, unless otherwise agreed
in writing by Lender, Borrower shall first (a) cause to be filed and/or
delivered to the Lender all Uniform Commercial Code financing statements,
certificates or other documents or instruments necessary to continue in effect
the perfected security interest of the Lender in the Collateral, and (b) have
given the Lender no less than fifteen (15) days prior written notice of such
relocation.
6.12 Borrower shall not incur any indebtedness senior to Lender's position
without the prior written consent of Lender.
SECTION 7. CONDITIONS PRECEDENT TO LOAN
Blanket Loan and Security Agr.
-12-
<PAGE>
The obligation of Lender to fund the Loan on each Advance Date shall be
subject to Lender's discretion and satisfactory completion of its due diligence
and approval process, and satisfaction by Borrower or waiver by Lender, in
Lender's reasonable discretion, of the following conditions:
7.1 Document Delivery. Borrower, on prior to the Closing Date, shall have
delivered to Lender the following:
(a) executed originals of the Agreement, the Warrant Agreement, and
any documents reasonably required by Lender to effectuate the liens of
Lender, with respect to all Collateral;
(b) certified copy of resolutions of Borrower's board of directors
evidencing approval of the borrowing and other transactions evidenced by
the Loans Documents;
(c) certified copies of the Certificate of Incorporation and the
Bylaws of Borrower, as amended through the Closing Date;
(d) certificate of good standing for Borrower from its state of
incorporation and similar certificates from all other jurisdictions in
which it does business and where the failure to be qualified would have a
Material Adverse Effect;
(e) payment of the Facility Fee less transaction and due diligence
expenses (not to exceed $7,500) shall be applied to the Facility Fee; and
(f) such other documents as Lender may reasonably request.
7.3 Advance Request.
(a) During Draw Period, Borrower, on or prior to each Advance Date,
shall have delivered to Lender the following:
(i) a minimum of five (5) business days prior to the Advance
Date, written notice in the form of an Advance Request, or as
otherwise specified by Lender from time to time, specifying amount of
such Advance and wire transfer instructions;
(ii) executed original of the Note(s); and
(iii) such other documents as Lender may reasonably request.
(b) During Extended Draw Period, Borrower on or prior to each Advance
Date, shall have delivered to Lender the following:
(i) a minimum of five (5) business days to the Advance Date,
written notice in the form of an Advance Request, or as otherwise
specified by Lender from time to time, specifying amount of such
Advance and wire instructions;
Blanket Loan and Security Agr.
-13-
<PAGE>
(ii) executed original of the Note(s);
(iii) a Warrant Agreement executed in accordance with Section 2.8
herein, and in a form substantially identical to the Warrant Agreement
attached hereto as Exhibit C, and
(iv) such other documents as Lender may reasonably request.
7.4 Perfection of Security Interests. Borrower shall have taken or caused
to be taken such actions reasonably requested by Lender to grant Lender a first
priority perfected security interest in the Collateral. Such actions shall
include, without limitation, the delivery to Lender of all appropriate
financing statements, executed by Borrower, as to the Collateral granted by
Borrower for all jurisdictions as may be necessary or desirable to perfect the
security interest of Lender in such Collateral
7.5 Absence of Events of Defaults. As of the Closing Date or the Advance
Date, no fact or condition exists that would (or would, with the passage of
time, the giving of notice, or both) constitute an Event of Default under this
Agreement or any of the Loan Documents.
7.6 Material Adverse Effect. As of the Closing Date or the Advance Date,
no event which has had or could reasonably be expected to have a Material
Adverse Effect has occurred and is continuing.
SECTION 8. ASSIGNMENT BY LENDER
8.1 Borrower acknowledges and understands that Lender may sell and assign
all or a part of its interest hereunder and under the Note(s) and Loan Documents
to any person or entity (an "Assignee"). After such assignment the term Lender
shall mean such Assignee, and such Assignee shall be vested with all rights,
powers and remedies of Lender hereunder with respect to the interest so
assigned; but with respect to any such interest not so transferred, the Lender
shall retain all rights, powers and remedies hereby given. No such assignment by
Lender shall relieve Borrower of any of its obligations hereunder. Borrower
shall acknowledge such assignment or assignments as shall be designated by
written notice given by Lender to Borrower. The Lender agrees that in the event
of any transfer by it of the Note(s), it will endorse thereon a notation as to
the portion of the principal of the Note(s) which shall have been paid at the
time of such transfer and as to the date to which interest shall have been last
paid thereon.
SECTION 9. DEFAULT
The occurrence of any one or more of the following events (herein called
"Events of Default") shall constitute a default hereunder and under the Note(s):
9.1 The Borrower defaults in the payment of any principal or interest
payable under the Note(s) and such default continues for more than five (5) days
after the due date thereof;
9.2 The Borrower defaults in the payment or performance of any other
covenant or obligation of the Borrower hereunder or under the Note(s) or any
other Loan Documents for more than ten (10) days after the Lender has given
notice of such default to the Borrower;
Blanket Loan Security Agr.
-14-
<PAGE>
9.3 Any representation or warranty as of the date made herein by the
Borrower shall prove to have been false or misleading in any material respect;
9.4 The making of an assignment by Borrower for the benefit of its
creditors or the admission by Borrower in writing of its inability to pay its
debts as they become due, or the insolvency of Borrower, or the filing by
Borrower of a voluntary petition in bankruptcy, or the adjudication of Borrower
as a bankrupt, or the filing by Borrower of any petition or answer seeking for
itself any reorganization, arrangement, composition, readjustment, liquidation,
dissolution, or similar relief under any present or future statute, law or
regulation, or the filing of any answer by Borrower admitting, or the failure by
Borrower to deny, the material allegations of a petition filed against it for
any such relief, or the seeking or consenting by Borrower to, or acquiescence by
Borrower in, the appointment of any trustee, receiver or liquidator of Borrower
or of all or any substantial part of the properties of Borrower, or the
inability of Borrower to pay its debts when due, or the commission by Borrower
of any act of bankruptcy as defined in the Federal Bankruptcy Act, as amended;
9.5 The failure by Borrower, within sixty (60) days after the commencement
of any proceeding against Borrower seeking any reorganization, arrangement,
composition, readjustment, liquidation, dissolution or similar relief under any
present or future statute, law or regulation, to obtain the dismissal of such
proceeding or, within sixty (60) days after the appointment, without the written
consent or acquiescence of Lender, of any trustee, receiver or liquidator of
Borrower or of all or any substantial part of the properties of Borrower, to
vacate such appointment;
9.6 The default by Borrower under any other notes or other agreement
for borrowed money, lease or other agreement between Borrower and Lender; or
9.7 The occurrence of any default under any lease or other agreement or
obligation of Borrower involving an amount in excess of $100,000.00 or having a
Material Adverse Effect; or the entry of any judgment against Borrower involving
an award in excess of $100,000.00 that would have a Material Adverse Effect,
that has not been bonded or stayed on appeal within thirty (30) days.
SECTION 10. REMEDIES
Upon the occurrence and continuation hereof of any one or more Events of
Default, Lender, at its option, may declare the Note(s) to be accelerated and
immediately due and payable, (provided, that upon the occurrence of an Event of
Default of the type described in 9.4 or 9.5, the Note(s) and all other Secured
Obligations shall automatically be accelerated and made due and payable without
any further act) whereupon the unpaid principal of and accrued interest on such
Note shall become immediately due and payable, and shall thereafter bear
interest at the Default Rate and calculated in accordance with Section 2.2.
Lender may exercise all rights and remedies with respect to the Collateral
granted pursuant hereto for such Note(s), or otherwise available to it under
applicable law, including the right to release, hold or otherwise dispose of all
or any part of the Collateral and the right to utilize, process and commingle
the Collateral.
Upon the happening and during the continuance of any Event of Default,
Lender may then, or at any time thereafter and from time to time, apply,
collect, sell in one or more sales,
Blanket Loan and Security Agr.
-15-
<PAGE>
lease or otherwise dispose of, any or all of the Collateral, in its then
condition or following any commercially reasonably preparation or processing, in
such order as Lender may elect, and any such sale may be made either at public
or private sale at its place of business or elsewhere. Borrower agrees that any
such public or private sale may occur upon five (5) calendar day's notice to
Borrower. Lender may require Borrower to assemble the Collateral and make it
available to Lender at a place designated by Lender which is reasonably
convenient to Lender and Borrower. The proceeds of any sale, disposition or
other realization upon all or any part of the collateral shall be distributed by
Lender in the following order of priorities:
First, to Lender in an amount sufficient to pay in full Lender's reasonable
costs and professionals' and advisors' fees and expenses;
Second, to Lender in an amount equal to the then unpaid amount of the
Secured Obligations in such order and priority as Lender may choose in its
sole discretion; and
Finally, upon payment in full of all of the Secured Obligations, to
Borrower or its representatives or as a court of competent jurisdiction may
direct.
The Lender shall return to the Borrower any surplus Collateral remaining after
payment of all Secured Obligations.
SECTION 11. MISCELLANEOUS
11.1 Borrower shall remain liable to Lender for any unpaid Secured
Obligations, advances, costs, charges and expenses, together with interest
thereon and shall pay the same immediately to Lender at Lender's offices.
11.2 The powers conferred upon Lender by this Agreement are solely to
protect its interest in the Collateral and shall not impose any duty upon Lender
to exercise any such powers.
11.3 This is a continuing Agreement and the grant of a security interest
hereunder shall remain in full force and effect and all the rights, powers and
remedies of Lender hereunder shall continue to exist until the Secured
Obligations are paid in full as the same become due and payable. When Borrower
has paid in full all Secured Obligations, Lender will, promptly but in no event
later than ten (10) days, upon request of Borrower, execute a written
termination Statement, reassigning to Borrower, without recourse, the Collateral
and all rights conveyed hereby and return possession (if Lender has possession)
of the Collateral to Borrower. The rights, powers and remedies of Lender
hereunder shall be in addition to all rights, powers and remedies given by
statute or rule of law and are cumulative. The exercise of any one or more of
the rights, powers and remedies provided herein shall not be construed as a
waiver of any other rights, powers and remedies of Lender. Furthermore,
regardless of whether or not the UCC is in effect in the jurisdiction where such
rights, powers and remedies are asserted, Lender shall have the rights, powers
and remedies of a secured party under the UCC.
11.4 Upon payment in full of all Secured Obligations, the Lender shall
cancel the Note(s), this Agreement and all UCC financing statements, if any, and
shall promptly deliver all such canceled documents to the Borrower.
Blanket Loan and Security Agr.
-16-
<PAGE>
11.5 GOVERNING LAW. This Agreement, the Note(s) and the other Loan
Documents have been negotiated and delivered to Lender in the State of Illinois
and shall not become effective until accepted by Lender in the State of
Illinois. Payment to Lender by Borrower of the Secured Obligations is due in the
State of Illinois. This Agreement shall be governed by, and construed and
enforced in accordance with the laws of the State of Illinois excluding conflict
of laws principles that would cause the application of laws of any other
jurisdiction.
11.6 CONSENT TO JURISDICTION AND VENUE. All judicial proceedings
arising in or under or related to this Agreement, the Note or any of the other
Loan Documents may be brought in any state or federal court of competent
jurisdiction located in the State of Illinois. By execution and delivery of this
Agreement, each party hereto generally and unconditionally: (a) consents to
personal jurisdiction in Cook County, State of Illinois; (b) waives any
objection as to jurisdiction or venue in the aforesaid courts; and (d)
irrevocably agrees to be bound by any judgment rendered thereby in connection
with this Agreement, the Note(s) and the other Loan Documents. Service of
process on any party hereto in any action arising out of or relating to this
Agreement shall be effective if given in accordance with the requirements for
notice set forth in Section 11.8 below and shall be deemed effective and
received as set forth in Section 11.8 below. Nothing herein shall affect the
right to serve process in any other manner permitted by law or shall limit the
right of either party to bring proceedings in the courts of any other
jurisdiction.
11.7 Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
such law, such provision shall be ineffective only to the extent and duration of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
11.8 Except as otherwise provided herein, all notices and service of
process required, contemplated, or permitted to have been validly served, or
hereunder shall be in writing and shall be deemed given or delivered upon the
earlier of: (i) the first business day after transmission by facsimile or hand
delivery or deposit with an overnight express service or overnight mail delivery
service; or (ii) or three (3) calendar days after mailed, postage prepaid, in
each case, and shall be addressed to the designated recipient, as follows:
(a) If to Lender:
------------
COMDISCO, INC.
Legal Department
Attention: General Counsel
6111 North River Road
Rosemont, Illinois 60018
Facsimile: 847.518.5088
Telephone: 847.518.698.3000
With Copys to:
-------------
COMDISCO, INC.
Attention: Comdisco Ventures
6111 North River Road
Rosemont, Illinois 60018
Blanket Loan and Security Agr.
-17-
<PAGE>
Facsimile: 847.518.5465
Telephone: 847.518.698.3000
and
Comdisco Ventures
Attention: Glen Howard
3000 Sand Hill Road, Bldg. 1, Suite 155
Menlo Park, CA 94025
Facsimile: 650.854.4026
Telephone: 650.854.9484
(b) If to Borrower:
--------------
ALIGN TECHNOLOGY INC. 442 Potrero Avenue
Sunnyvale, CA 94086
Attention:__________________
Facsimile: (408) 738-7150
Telephone (408) 738-1500
With a Copy to:
--------------
____________________________
____________________________
____________________________
Attention:__________________
Facsimile:__________________
Telephone:__________________
or to such other address as each party may designate for itself by like notice.
11.9 Lender and Borrower acknowledge that there are no agreements
or understandings, written or oral, between Lender and Borrower with respect to
the Loan, other than as set forth herein, in the Note(s) and the other Loan
Documents and that this Agreement, the Note(s) and the other Loan Documents
contain the entire agreement between Lender and Borrower with respect thereto.
None of the terms of this Agreement, the Note(s) and the other Loan Documents
may be amended except by an instrument executed by each of the parties hereto.
11.10 No omission, or delay, by Lender at any time to enforce any
right or remedy reserved to it, or to require performance of any of the terms,
covenants or provisions hereof by Borrower at any time designated, shall be a
waiver of any such right or remedy to which Lender is entitled, nor shall it in
any way affect the right of Lender to enforce such provisions thereafter.
11.11 All agreements, representations and warranties contained in
this Agreement or the Note, or in any Loan Documents delivered pursuant hereto
or in connection herewith shall be for the benefit of Lender and any Assignee
and shall survive the execution and delivery of this Agreement or the Note and
the expiration or other termination of this Agreement or the Note.
Blanket Loan and Security Agr.
-18-
<PAGE>
11.12 This Agreement may be executed in any number of counterparts,
each of which shall be deemed an original, but all such counterparts together
shall constitute but one and the same instrument.
11.13 CONFIDENTIALITY. Lender acknowledges that certain items of
Collateral, including, but not limited to trade secrets, source codes, customer
lists and certain other items of intellectual Property, and any Financial
Statements provided pursuant to Section 6 hereof, constitute proprietary and
confidential information of the Borrower (the "Confidential Information").
Accordingly, lender agrees that any Confidential Information it may obtain in
the course of acquiring, perfecting or foreclosing on the Collateral or
otherwise provided under this Agreement, provided such Confidential Information
is marked as confidential by Borrower at the time of disclosure or is oral
information which is confirmed in writing and marked as confidential with thirty
(30) days following disclosure, shall be received in the strictest confidence
and will not be disclosed to any other person or entity in any manner
whatsoever, in whole or in part, without the prior written consent of the
Borrower, unless and until Lender has acquired indefeasible title thereto.
11.14 This Agreement shall be binding upon, and shall inure to the
benefit of, Borrower and its permitted assigns (if any). Borrower shall not
assign its obligations under this Agreement, the Note(s) or any of the other
Loan Documents without Lender's express written consent and any such attempted
assignment shall be void and of no effect. Any assignment by Borrower in
connection with a "Merger" (as defined below) shall be subject to Lender's prior
consent. Any consent granted by Lender shall be conditioned upon such surviving
entity or transferee assuming Borrower's Secured Obligations hereunder pursuant
to assignment documents reasonably acceptable to Lender. If Lender reasonably
withholds its consent to such assignment in connection with a Merger, the
outstanding principal and accrued and unpaid interest shall be prepaid in whole
in accordance with Section 2.6 hereof.
For purposes of this Agreement, a "Merger" shall mean any
consolidation or merger of the Borrower with or into any other corporation or
entity, any sale or conveyance of an or substantially all of the assets or stock
of the Borrower by or to any other person or entity in which Borrower is not the
surviving entity.
IN WITNESS WHEREOF, the Borrower and the Lender have duly executed and
delivered this Agreement as of the day and year first above written.
BORROWER: ALIGN TECHNOLOGY INC.
By: /s/ Muhammed Ziaullah K. Chishti
------------------------------------
Title: CEO
------------------------------------
Date: 4/16/99
------------------------------------
Blanket Loan and Security Agr.
-19-
<PAGE>
ACCEPTED IN ROSEMONT, ILLINOIS:
------------------------------
LENDER: COMDISCO, INC.
By: ____________________________
Title: ____________________________
Date: ____________________________
-20-
<PAGE>
EXHIBIT A
SECURED PROMISSORY NOTE
$_______________ Date:________________
Due: ________________
FOR VALUE RECEIVED, Align Technology Incorporated a Delaware corporation (the
"Borrower") hereby promises to pay to the order of Comdisco, Inc., a Delaware
corporation (the "Lender") at P.O. Box 91744, Chicago, IL 60693 or such other
place of payment as the holder of this Secured Promissory Note (this "Note") may
specify from time to time in writing, in lawful money of the United States of
America, the principal amount of ___________ and 00/l00 Dollars ($___________)
together with interest at twelve percent (12.0%) per annum from the date of this
Note to maturity of each installment on the principal hereof remaining from time
to time unpaid, such principal and interest to be paid in 36 equal monthly
installments of $___________ each, commencing ____________ and on the same day
of each month thereafter to and including ___________, such installments to be
applied first to accrued and unpaid interest and the balance to unpaid
principal. Interest shall be computed on the basis of a year consisting of
twelve months of thirty days each.
This Note is the Note referred to in, and is executed and delivered in
connection with, that certain Loan and Security Agreement of dated as of April
12 1999 herewith by and between Borrower and Lender (as the same may from time
to time be amended, modified or supplemented in accordance with its terms, the
"Loan Agreement"), and is entitled to the benefit and security of the Loan
Agreement and the other Loan Documents (as defined in the Loan Agreement), to
which reference is made for a statement of all of the terms and conditions
thereof. All terms defined in the Loan Agreement shall have the same definitions
when used herein, unless otherwise defined herein.
The Borrower waives presentment and demand for payment, notice of dishonor,
protest and notice of protest and any other notice as permitted under the UCC or
any applicable law.
This Note has been delivered to Lender and is payable in the State of Illinois,
and shall not become effective until accepted by Lender in the State of
Illinois. This Note shall be governed by and construed and enforced in
accordance with, the laws of the State of Illinois, excluding any conflicts of
law rules or principles that would cause the application of the laws of any
other jurisdiction.
BORROWER: ALIGN TECHNOLOGY INC.
442 Potrero Ave.
Sunnyvale, CA 94086
Signature: ____________________________
Print Name: ____________________________
Title: ____________________________
<PAGE>
EXHIBIT B
ADVANCE REQUEST
Date: _________________
To Lender: Comdisco, Inc.
% Comdisco Ventures
3000 Sand Hill Road
Menlo Park, CA 94025
Attention: Vika Tonga
Facsimile (650) 854-4026
Borrower hereby requests from Comdisco, Inc. ("Lender") an Advance in the amount
of $_______________ under that Loan and Security Agreement between Borrower and
Lender dated April 12, 1999 (the "Agreement").
Please:
------
(a) Issue a check payable to Borrower ____________
or
(b) Wire Funds to Borrower's account ____________
Bank: ______________________________________
Address: ______________________________________
______________________________________
ABA Number: ______________________________________
Account Number: ______________________________________
Account Name: ______________________________________
Borrower hereby affirms that all Representations and Warranties of Borrower set
forth in Section 4 and all Conditions Precedent to Loan set forth in Section 7
of the Agreement remain true and correct in all material respects as of the date
hereof.
Executed this ____ day of __________, 1999 by:
BORROWER: ALIGN TECHNOLOGY INC.
BY: ________________________
TITLE: ________________________
PRINT: ________________________
Blanket Loan and Security Agr.
-21-