Exhibit 10.40
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WELLS FARGO
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REVOLVING LINE OF CREDIT NOTE
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$10,000,000.00
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San Jose, California
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June 1, 2005
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FOR VALUE RECEIVED, the undersigned SYMMETRICOM,
INC. (“Borrower”) promises to pay to the order of WELLS
FARGO BANK, NATIONAL ASSOCIATION (“Bank”) at its office
at Santa Clara Technology RCBO, 121 Park Center Plaza, 3rd Floor,
San Jose, CA 95113, or at such other place as the holder hereof may
designate, in lawful money of the United States of America and in
immediately available funds, the principal sum of $10,000,000.00,
or so much thereof as may be advanced and be outstanding, with
interest thereon, to be computed on each advance from the date of
its disbursement as set forth herein.
1.
DEFINITIONS:
As used herein, the following terms
shall have the meanings set forth after each, and any other term
defined in this Note shall have the meaning set forth at the place
defined:
1.1 “Business Day” means any day
except a Saturday, Sunday or any other day on which commercial
banks in California are authorized or required by law to
close.
1.2 “Fixed Rate Term” means a period
commencing on a Business Day and continuing for 1, 2 or 3
months, as designated by Borrower, during which all or a
portion of the outstanding principal balance of this Note bears
interest determined in relation to LIBOR; provided however, that no
Fixed Rate Term may be selected for a principal amount less than
$100,000.00; and provided further, that no Fixed Rate Term
shall extend beyond the scheduled maturity date hereof. If any
Fixed Rate Term would end on a day which is not a Business Day,
then such Fixed Rate Term shall be extended to the next succeeding
Business Day.
1.3 “LIBOR” means the rate per annum
(rounded upward, if necessary, to the nearest whole 1/8 of 1%)
determined by dividing Base LIBOR by a percentage equal to 100%
less any LIBOR Reserve Percentage.
(a) “Base LIBOR”
means the rate per annum for United States dollar deposits quoted
by Bank as the Inter-Bank Market Offered Rate, with the
understanding that such rate is quoted by Bank for the purpose of
calculating effective rates of interest for loans making reference
thereto, on the first day of a Fixed Rate Term for delivery of
funds on said date for a period of time approximately equal to the
number of days in such Fixed Rate Term and in an amount
approximately equal to the principal amount to which such Fixed
Rate Term applies. Borrower understands and agrees that Bank may
base its quotation of the Inter-Bank Market Offered Rate upon such
offers or other market indicators of the Inter-Bank Market as Bank
in its discretion deems appropriate including, but not limited to,
the rate offered for U.S. dollar deposits on the London Inter-Bank
Market.
(b) “LIBOR Reserve
Percentage” means the reserve percentage prescribed by the
Board of Governors of the Federal Reserve System (or any successor)
for “Eurocurrency Liabilities” (as defined in
Regulation D of the Federal Reserve Board, as amended), adjusted by
Bank for expected changes in such reserve percentage during the
applicable Fixed Rate Term.
1.4 “Prime Rate” means at any time
the rate of interest most recently announced within Bank at its
principal office as its Prime Rate, with the understanding that the
Prime Rate is one of Bank’s base rates and serves as the
basis upon which effective rates of interest are calculated for
those loans making reference thereto, and is evidenced by the
recording thereof after its announcement in such internal
publication or publications as Bank may designate.
2.
INTEREST:
2.1 Interest . The outstanding principal
balance of this Note shall bear interest (computed on the basis of
a 360- day year, actual days elapsed) either (a) at a
fluctuating rate per annum equal to the Prime Rate in effect
from time to time, or (b) at a fixed rate per annum determined
by Bank to be 1.75000% above LIBOR in effect on the first
day of the applicable Fixed Rate Term. When interest is determined
in relation to the Prime Rate, each change in the rate of interest
hereunder shall become effective on the date each Prime Rate change
is announced within Bank. With respect to each LIBOR selection
option selected hereunder, Bank is hereby authorized to note the
date, principal amount, interest rate and Fixed Rate Term
applicable thereto and any payments made thereon on Bank’s
books and records (either manually or by electronic entry) and/or
on any schedule attached to this Note, which notations shall
be prima facie evidence of the accuracy of the information
noted.
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