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Sample Business ContractsHome: Sample Business Contracts:
LOAN AND SECURITY AGREEMENT
WELLS FARGO RETAIL FINANCE, LLC
The Lender
REDENVELOPE, INC.
The Borrower
June 26, 2006
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EXHIBITS
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LOAN AND SECURITY AGREEMENT
June 26, 2006
THIS AGREEMENT is made between
WELLS FARGO RETAIL FINANCE, LLC (in such capacity, herein the “Lender”), a Delaware limited liability company with offices at One Boston Place — 19th Floor, Boston, Massachusetts 02108;
and
REDENVELOPE, INC. (the “Borrower”), a Delaware corporation with its principal executive offices at 149 Montgomery Street, San Francisco, California 94105,
in consideration of the mutual covenants contained herein and benefits to be derived herefrom,
WITNESSETH:
Article 1 — Definitions:
As used herein, the following terms have the following meanings or are defined in the section of this Agreement so indicated:
"Account Debtor”: Has the meaning given that term in the UCC.
"Accounts” and “Accounts Receivable”: Include, without limitation, “accounts” as defined in the UCC, and also all: accounts, accounts receivable, receivables, and rights to payment (whether or not earned by performance) for: property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of; services rendered or to be rendered; a policy of insurance issued or to be issued; a secondary obligation incurred or to be incurred; energy provided or to be provided; for the use or hire of a vessel; arising out of the use of a credit or charge card or information contained on or used with that card; winnings in a lottery or other game of chance; and also all Inventory which gave rise thereto, and all rights associated with such Inventory, including the right of stoppage in transit; all reclaimed, returned, rejected or repossessed Inventory (if any) the sale of which gave rise to any Account.
"ACH”: Automated clearing house.
"Affiliate”: The following:
(a) With respect to any two Persons, a relationship in which one Person, directly or indirectly, through one or more intermediaries, is Controlled by, Controls, or is under common Control with the other Person.
(b) Any Person which: could have such enterprise’s tax returns or financial statements consolidated with the Borrower’s; could be a member of the same controlled group of corporations (within the meaning of Section 1563(a)(1), (2) and (3) of the Internal Revenue Code of 1986, as amended from time to time) of which the Borrower is a member; or controls or is controlled by the Borrower.
"Applicable Law”: As to any Person: (i) All statutes, rules, regulations, orders, or other requirements having the force of law and (ii) all court orders and injunctions, arbitrator’s decisions, and/or similar rulings, in each instance ((i) and (ii)) of or by any federal, state, municipal, and other governmental authority, or court, tribunal, panel, or other body which has or claims jurisdiction over such Person, or any property of such Person, or of any other Person for whose conduct such Person would be responsible.
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“Appraisal Percentage”: Means 85%, provided however, that so long as Borrower is not In Default, upon the Effective Date of any Seasonal Advance Rate Request given by the Borrower to the Lender in any calendar year, the Appraisal Percentage shall be 90% until the earlier of (i) sixty (60) days from such Effective Date or (ii) December 15th of such year.
“Availability”: The result of the following:
(i) The lesser of
(A) The Revolving Credit Ceiling.
or
(B) The Borrowing Base.
Minus
(ii) The aggregate unpaid balance of the Loan Account.
Minus
(iii) The aggregate undrawn Stated Amount of all then outstanding L/C’s.
Minus
(iv) The aggregate of the Availability Reserves.
“Availability Reserves”: Such reserves as the Lender from time to time determines in the Lender’s reasonable discretion as being appropriate to reflect the impediments to the Lender’s ability to realize upon the Collateral, or to address the anticipated expenditure of funds or the incurrence of obligations by the Lender, which in each case are made, undertaken, or incurred in the Lender’s reasonable discretion (i) to protect, preserve, or maintain, directly or indirectly, the Collateral or the collateral interests granted by the Borrower, including the Borrower’s business assets and infrastructure, such as with respect to the payment of rent under any of the Borrower’s leases or the payment of salary or payroll to any of the Borrower’s employees, (ii) to implement and exercise the Lender’s rights upon default with respect to any Collateral granted by the Borrower, or (iii) to otherwise further and protect the Lender’s interests.
“Average Excess Availability”: Means, for the subject period, the aggregate of the amount of Availability on each day in the period, divided by the number of days in the subject period.
“Bank Product Agreements”: Those certain cash management service agreements entered into from time to time by the Borrower in connection with any of the Bank Products.
“Bank Product Obligations”: All obligations, liabilities, contingent reimbursement obligations, fees, and expenses owing by the Borrower to the Lender, Wells Fargo Bank, N. A., or any of their Affiliates pursuant to or evidenced by the Bank Product Agreements and irrespective of whether for the payment of money, whether direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, and including all such amounts that the Borrower is obligated to reimburse to the Lender as a result of the Lender purchasing participations or executing indemnities or reimbursement obligations with respect to the Bank Products provided to the Borrower pursuant to the Bank Product Agreements.
“Bank Products”: Any service or facility extended to the Borrower by Wells Fargo Bank, N. A. or any of its Affiliates, including: (a) credit cards, (b) credit card processing services, (c) debit cards, (d) purchase
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cards, (e) ACH transactions, (f) cash management, including controlled disbursement, accounts or services, or (g) hedge agreements.
“Bank Product Reserves”: As of any date of determination, the amount of reserves that the Lender has established (based upon Wells Fargo Bank, N. A.’s or its Affiliate’s reasonable determination of the credit exposure in respect of then extant Bank Products) for Bank Product Obligations then provided or outstanding.
“Bankruptcy Code”: Title 11, U.S.C., as amended from time to time.
“Blocked Account”: Is defined in Section 7.1(a)(ii).
“Blocked Account Agreement”: An Agreement, in form reasonably satisfactory to the Lender, which Agreement recognizes the Lender’s Collateral Interest in the contents of the Blocked Account and provides that such contents shall be transferred only to the Concentration Account or as otherwise instructed by the Lender.
“Borrower”: Is defined in the Preamble.
“Borrowing Base”: The aggregate of the following:
The face amount of Eligible Credit Card Receivables multiplied by Eighty-five (85%).
Plus
The lesser of (a) the Cost of Eligible Inventory (net of Inventory Reserves) multiplied by the Inventory Advance Rate, or (b) Appraisal Percentage of the NRLV.
“Borrowing Base Certificate”: Is defined in Section 5.4.
“Business Day”: Any day other than (a) a Saturday or Sunday; (b) any day on which banks in Boston, Massachusetts or in San Francisco, California generally are not open to the general public for the purpose of conducting commercial banking business; or (c) a day on which the principal office of the Lender is not open to the general public to conduct business.
“Business Plan”: The Borrower’s business plan, delivered to the Lender prior to the Closing Date, and any revision, amendment, or update of such business plan to which the Lender has provided its written sign-off.
“Capital Expenditures”: The expenditure of funds or the incurrence of liabilities which may be capitalized in accordance with GAAP.
“Capital Lease”: Any lease which may be capitalized in accordance with GAAP.
“Cash Dominion Event”: Either (i) the failure of the Borrower to maintain Availability in an amount greater than or equal $4,000,000.00 at any time, or (ii) the Borrower becoming In Default or the occurrence of any Event of Default.
“Cash Equivalents”: Any of the following:
(a) marketable direct obligations issued by, or unconditionally guaranteed by, the United States or obligations of a United States federal agency or government sponsored enterprises, in each case maturing within 1 year from the date of acquisition thereof;
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(b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of acquisition, having one of the two highest ratings obtainable from either Standard & Poor’s Rating Group (“S&P”) or Moody’s Investors Service, Inc. (“Moody’s”);
(c) commercial paper maturing no more than 270 days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at least P-1 from Moody’s;
(d) certificates of deposit or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof having at the date of acquisition thereof combined capital and surplus of not less than $250,000,000;
(e) Deposit Accounts maintained with (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United States or any state thereof so long as the amount maintained with any such other bank is less than or equal to $100,000 and is insured by the Federal Deposit Insurance Corporation;
(f) Master Notes, Repurchase Agreements (collateralized at least 102% by U.S. Government securities) and Corporate Notes and floating rate notes which are rated A3/A- or better by S&P and Moody’s, and
(g) Investments in money market funds substantially all of whose assets are invested in the types of assets described in clauses (a) through (f) above.
“Change in Control”: The occurrence of any of the following, unless such event is on terms and conditions acceptable to the Lender, in its sole and exclusive discretion, and the Lender has confirmed its approval by providing written assent thereto:
(a) Any change in the beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) by any group of persons (within the meaning of the Exchange Act) or by any Person, of 25% or more of the issued and outstanding capital stock of the Borrower having the right, under ordinary circumstances, to vote for the election of directors of the Borrower, that results in such Person or group of Persons becoming the largest shareholder of Borrower.
(b) More than half of the persons who were directors of the Borrower on the Closing Date (together with any new directors whose nomination for election by the equity holders of the Borrower, was approved by a vote of at least a majority of the directors then still in office who were directors on the Closing Date or approved in this manner), cease, for any reason other than death or disability, to be directors of the Borrower.
“Chattel Paper”: Has the meaning given that term in the UCC.
“Clean Down Event”: Is defined in Section 5.8.
“Closing Date”: June 26, 2006.
“Closing Fee”: Is defined in Section 2.13.
“Collateral”: Is defined in Section 8.1.
“Collateral Interest”: Any interest in property to secure an obligation, including, without limitation, a security interest, mortgage, and deed of trust.
“Concentration Account”: Is defined in Section 7.1.
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“Control”: The possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors of a Person, or (b) to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.
“Cost”: The lower of (a) or (b), where:
(a) is the calculated cost of purchases, based upon the Borrower’s accounting practices, known to the Lender, which practices are in effect on the date on which this Agreement was executed as such calculated cost is determined from: invoices received by the Borrower; the Borrower’s purchase journal; or the Borrower’s stock ledger.
(b) is the cost equivalent of the lowest ticketed or promoted price at which the subject Inventory is then offered to the public, after all mark-downs (whether or not such price is then reflected on the Borrower’s accounting system), which cost equivalent is determined in accordance with the retail method of accounting, reflecting the Borrower’s historic business practices.
(“Cost” does not include inventory capitalization costs or other non-purchase price charges (such as freight) used in the Borrower’s calculation of cost of goods sold).
“Costs of Collection”: Includes, without limitation, all attorneys’ reasonable fees and reasonable out-of-pocket expenses incurred by the Lender’s attorneys, and all reasonable out-of-pocket costs incurred by the Lender in the administration of the Liabilities and/or the Loan Documents, including, without limitation, reasonable costs and expenses associated with travel on behalf of the Lender, where such costs and expenses are directly or indirectly related to or in respect of the Lender’s: administration and management of the Liabilities; negotiation, documentation, and amendment of any Loan Document; or efforts to preserve, protect, collect, or enforce the Collateral, the Liabilities, and/or the Lender’s Rights and Remedies and/or any of the rights and remedies of the Lender against or in respect of any guarantor or other person liable in respect of the Liabilities (whether or not suit is instituted in connection with such efforts). The Costs of Collection are Liabilities, and at the Lender’s option may bear interest at the then effective Prime Margin Rate.
“Customer Credit Liability”: Gift certificates, gift cards, customer deposits, merchandise credits, layaway obligations, frequent shopping programs, and similar liabilities of the Borrower to its retail customers and prospective customers.
“DDA”: Any checking or other demand daily depository account maintained by the Borrower other than any Exempt DDA.
“Deposit Account”: Has the meaning given that term in the UCC and also includes all demand, time, savings, passbook, or similar accounts maintained with a bank.
“Documents”: Has the meaning given that term in the UCC.
“Documents of Title”: Has the meaning given that term in the UCC.
“Effective Date”: Means the effective date of any increase to the Appraisal Percentage and the Inventory Advance Rate set forth by Borrower in any Seasonal Advance Rate Request to Lender, which date shall be not less than Fifteen (15) days after receipt by the Lender of such Seasonal Advance Rate Request.
“Eligible Credit Card Receivables”: Accounts due on a non-recourse basis from major credit card processors (which, if due on account of a private label credit card program, are deemed in the discretion of the Lender to be eligible) which are outstanding fewer than Six (6) days.
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“Eligible In-Transit Inventory” means, as of any date of determination thereof, without duplication of other Eligible Inventory, Inventory:
(a) Which has been shipped from a location for receipt by Borrower but which has not yet been delivered to such Borrower;
(b) For which the purchase order is in the name of Borrower and title has passed to such Borrower;
(c) For which the document of title reflects a Borrower as consignee or, if requested by the Lender, names the Lender as consignee, and in each case as to which the Lender has control over the documents of title which evidence ownership of the subject Inventory (such as, if requested by the Lender, by the delivery of a customs broker agreement in form and substance reasonably satisfactory to the Lender)
(d) Which has been paid for in full by the Borrower;
(e) Which is insured to the reasonable satisfaction of the Lender;
(f) Which has not been in transit for more than sixty (60) days; and
(g) Which otherwise would constitute Eligible Inventory.
“Eligible In-Transit Inventory Cap” means $1,000,000.00 provided however, that so long as Borrower is not In Default, upon the Effective Date of any Seasonal Advance Rate Request given by the Borrower to the Lender in any calendar year, $2,000,000.00 until the earlier of (i) sixty (60) days from such Effective Date or (ii) December 15th of such year.
“Eligible Inventory”: without duplication, (i) Eligible In-Transit Inventory in the aggregate amount not to exceed the Eligible In-Transit Inventory Cap and (ii) all of the following: Such of the Borrower’s Inventory, at such locations, and of such types, character, qualities and quantities, as the Lender, in its reasonable discretion, from time to time determines to be acceptable for borrowing, as to which Inventory, the Lender has a perfected security interest which is prior and superior to all security interests, claims, and Encumbrances (other than Permitted Encumbrances).
“Employee Benefit Plan”: As defined in ERISA.
“Encumbrance”: Each of the following:
(a) A Collateral Interest or agreement to create or grant a Collateral Interest; the interest of a lessor under a Capital Lease; conditional sale or other title retention agreement; sale of accounts receivable or chattel paper; or other arrangement pursuant to which any Person is entitled to any preference or priority with respect to the property or assets of another Person or the income or profits of such other Person; each of the foregoing whether consensual or non-consensual and whether arising by way of agreement, operation of law, legal process or otherwise.
(b) The filing of any financing statement under the UCC or comparable law of any jurisdiction.
“End Date”: The date upon which all of the following conditions are met: (a) all payment Liabilities described in Section 13.2(a) have been paid in full and (b) all obligations of the Lender to make loans and advances and to provide other financial accommodations to the Borrower hereunder shall have been irrevocably terminated and (c) those arrangements concerning L/C’s, Bank Products, Bank Product Obligations, and indemnification obligations which are described in Sections 13.2(b) and 13.2(d) have been made.
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“Environmental Laws”: All of the following:
(a) Applicable Law which regulates or imposes any standard of conduct or liability on account of or in respect to environmental protection matters, including, without limitation, Hazardous Materials, as are now or hereafter in effect.
(b) The common law relating to damage to Persons or property from Hazardous Materials.
“Equipment”: Includes, without limitation, “equipment” as defined in the UCC, and also all furniture, store fixtures, motor vehicles, rolling stock, machinery, office equipment, plant equipment, tools, dies, molds, and other goods, property, and assets which are used and/or were purchased for use in the operation or furtherance of the Borrower’s business, and any and all accessions or additions thereto, and substitutions therefore.
“ERISA”: The Employee Retirement Income Security Act of 1974, as amended.
“ERISA Affiliate”: Any Person which is under common control with the Borrower within the meaning of Section 4001 of ERISA or is part of a group which includes the Borrower and which would be treated as a single employer under Section 414 of the Internal Revenue Code of 1986, as amended.
“Events of Default”: Is defined in Article 10. An “Event of Default” shall be deemed to have occurred and to be continuing unless and until that Event of Default has been duly waived by the Lender.
“Exchange Act ”: Means, the Securities Exchange Act of 1934, as amended.
“Fee Letter”: Means that certain Fee letter dated June 26 2006 entered into by and between the Lender and the Borrower.
“Fiscal”: When followed by “month” or “quarter,” the relevant fiscal period based on the Borrower’s fiscal year and accounting conventions (e.g. reference to “Fiscal 2007” is to the fiscal month of the Borrower’s fiscal year ending in 2007). When followed by reference to a specific year, the fiscal year which ends in a month of the year to which reference is being made (e.g. if the Borrower’s fiscal year ends in March 2007, reference to that year would be to the Borrower’s “Fiscal 2007”).
“Fixtures”: Has the meaning given that term in the UCC.
“GAAP”: Principles which are consistent with those promulgated or adopted by the Financial Accounting Standards Board and its predecessors (or successors) in effect and applicable to that accounting period in respect of which reference to GAAP is being made.
“General Intangibles”: Includes, without limitation, “general intangibles” as defined in the UCC; and also all: rights to payment for credit extended; deposits; amounts due to the Borrower; credit memoranda in favor of the Borrower; warranty claims; tax refunds and abatements; insurance refunds and premium rebates; all means and vehicles of investment or hedging, including, without limitation, options, warrants, and futures contracts; records; customer lists; telephone numbers; goodwill; causes of action; judgments; payments under any settlement or other agreement; royalties; license and/or franchise fees; licenses; franchises; license agreements, including all rights of the Borrower to enforce same; permits, certificates of convenience and necessity, and similar rights granted by any governmental authority; patents, patent applications, patents pending, and other intellectual property; internet addresses and domain names; developmental ideas and concepts; proprietary processes; blueprints, drawings, designs, diagrams, plans, reports, and charts; catalogs; manuals; technical data; computer software programs (including the source and object codes therefore), computer records, computer software, rights of access to computer record service bureaus, service bureau computer contracts, and computer data; tapes, disks, semi-conductor chips and printouts; trade secret rights, copyrights, mask work rights and interests, and derivative works and interests; user, technical reference, and
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other manuals and materials; trade names, trademarks, service marks, and all goodwill relating thereto; applications for registration of the foregoing; and all other general intangible property of the Borrower in the nature of intellectual property, proposals, cost estimates, and reproductions on paper, or otherwise, of any and all concepts or ideas, and any matter related to, or connected with, the design, development, manufacture, sale, marketing, leasing, or use of any or all property produced, sold, or leased, by the Borrower or credit extended or services performed, by the Borrower, whether intended for an individual customer or the general business of the Borrower, or used or useful in connection with research by the Borrower.
“Goods”: Has the meaning given that term in the UCC, and also includes all things movable when a security interest therein attaches and also all computer programs embedded in goods and any supporting information provided in connection with a transaction relating to the program if (i) the program is associated with the goods in such manner that it customarily is considered part of the goods or (ii) by becoming the owner of the goods, a Person acquires a right to use the program in connection with the goods.
“Hazardous Materials”: Any (a) substance which is defined or regulated as a hazardous material in or under any Environmental Law and (b) oil in any physical state.
“Indebtedness”: All indebtedness and obligations of or assumed by any Person on account of or in respect to any of the following:
(a) In respect of money borrowed (including any indebtedness which is non-recourse to the credit of such Person but which is secured by an Encumbrance on any asset of such Person) whether or not evidenced by a promissory note, bond, debenture or other written obligation to pay money.
(b) In connection with any letter of credit or acceptance transaction (including, without limitation, the face amount of all letters of credit and acceptances issued for the account of such Person or reimbursement on account of which such Person would be obligated).
(c) In connection with the sale or discount of accounts receivable or chattel paper of such Person.
(d) On account of deposits or advances.
(e) As lessee under Capital Leases.
(f) In connection with any sale and leaseback transaction.
“Indebtedness” also includes:
(x) Indebtedness of others secured by an Encumbrance on any asset of such Person, whether or not such Indebtedness is assumed by such Person.
(y) Any guaranty, endorsement, suretyship or other undertaking pursuant to which that Person may be liable on account of any obligation of any third party (including, without limitation, the posting of any bond to secure a Person’s performance under any agreement).
(z) The Indebtedness of a partnership or joint venture for which such Person is liable as a general partner or joint venturer.
(For the avoidance of doubt, “Indebtedness” shall not include Customer Credit Liability)
“In Default”: Any occurrence, circumstance, or state of facts with respect to the Borrower which (a) is an Event of Default; or (b) would become an Event of Default if any requisite notice were given and/or any requisite period of time were to run and such occurrence, circumstance, or state of facts were not absolutely
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cured within any applicable grace period, provided that the Borrower shall no longer be deemed “In Default” if such occurrence, circumstance, or state of facts has been cured prior to it becoming an Event of Default.
“Indemnified Person”: Is defined in Section 14.14.
“Insolvency Proceeding”: Any proceeding commenced by or against any Person under any provision of the Bankruptcy Code or under any other state or federal bankruptcy or insolvency law, assignments for the benefit of creditors, formal or informal moratoria, compositions, extensions generally with creditors, or proceedings seeking reorganization, arrangement, or other similar relief.
“Instruments”: Has the meaning given that term in the UCC.
“Interest Payment Date”: With reference to:
Each Libor Loan: The last day of the Interest Period relating thereto; the Termination Date; and the End Date.
Each Prime Margin Loan: The first day of each month; the Termination Date; and the End Date.
“Interest Period”: The following:
(a) With respect to each Libor Loan: Subject to Subsection (c), below, the period commencing on the date of the making or continuation of, or conversion to, the subject Libor Loan and ending one, two, or three months thereafter, as the Borrower may elect by notice (pursuant to Section 2.6) to the Lender.
(b) With respect to each Prime Margin Loan: Subject to Subsection (c), below, the period commencing on the date of the making or continuation of or conversion to such Prime Margin Loan and ending on that date (i) as of which the subject Prime Margin Loan is converted to a Libor Loan, as the Borrower may elect by notice (pursuant to Section 2.6) to the Lender, or (ii) on which the subject Prime Margin Loan is paid by the Borrower.
(c) The setting of Interest Periods is in all instances subject to the following:
(i) Any Interest Period for a Prime Margin Loan which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day.
(ii) Any Interest Period for a Libor Loan which would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day, unless that succeeding Business Day is in the next calendar month, in which event such Interest Period shall end on the last Business Day of the month during which the Interest Period ends.
(iii) Subject to Subsection (iv), below, any Interest Period applicable to a Libor Loan, which Interest Period begins on a day for which there is no numerically corresponding day in the calendar month during which such Interest Period ends, shall end on the last Business Day of the month during which that Interest Period ends.
(iv) Any Interest Period which would otherwise end after the Termination Date shall end on the Termination Date.
(v) The number of Interest Periods in effect at any one time is subject to Section 2.12(e).
“Inventory”: Includes, without limitation, “inventory” as defined in the UCC and also all: (a) Goods which are held by a Person for sale or to be furnished under a contract of service; are furnished by a Person
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under a contract of service; or consist of raw materials, work in process, or materials used or consumed in a business; (b) Goods of said description in transit; (c) Goods of said description which are returned, repossessed and rejected; (d) packaging, advertising, and shipping materials related to any of the foregoing; (e) the Borrower’s rights, if any, in and to all names, marks, and General Intangibles affixed or to be affixed or associated thereto; and (f) Documents and Documents of Title which represent any of the foregoing.
“Inventory Advance Rate”: Means 62%, provided however, that so long as Borrower is not In Default, upon the Effective Date of any Seasonal Advance Rate Request given by the Borrower to the Lender in any calendar year, the Inventory Advance Rate shall be 76% until the earlier of (i) sixty (60) days from such Effective Date or (ii) December 15th of such year.
“Inventory Reserves”: Such Reserves as may be established from time to time by the Lender in the Lender’s reasonable discretion with respect to the determination of the saleability, at retail, of the Eligible Inventory or which reflect such other factors as affect the market value or the NRLV of the Eligible Inventory.
“Investment”: With respect to any Person (a) the direct or indirect purchase or acquisition of any beneficial interest in, any share of capital stock of, evidence of Indebtedness of or other security issued by any other Person, (b) any loan, advance or extension of credit to, or contribution to the capital of, any other Person, excluding advances to employees in the ordinary course of business for business expenses, (c) the guaranty of the obligations of any other Person, or (d) any commitment or option to take any of the actions described in clauses (a), (b), or (c) above.
“Investment Property”: Has the meaning given that term in the UCC.
“Issuer”: The issuer of any L/C.
“L/C”: Any letter of credit, the issuance of which is procured by the Lender at the request of the Borrower for the account of the Borrower and any acceptance made on account of such letter of credit.
“L/C Landing Costs”: To the extent not included in the Stated Amount of an L/C, customs, duty, freight, and other out-of-pocket costs and expenses which will be expended to “land” the Inventory, the purchase of which is supported by such L/C.
“Lease”: Any lease or other agreement, no matter how styled or structured, pursuant to which the Borrower is entitled to the use or occupancy of any space.
“Leasehold Interest”: Any interest of the Borrower as lessee under any Lease.
“Lender”: Is referred to in the Preamble.
“Lender’s Rights and Remedies”: Is defined in Section 11.7.
“Letter-of-Credit Right”: Has the meaning given that term in UCC and also refers to any right to payment or performance under an L/C, whether or not the beneficiary has demanded |
