1
Exhibit 10.8
AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of June 30, 1995
and amended and restated as of July 24, 1998
among
TRANSTECHNOLOGY CORPORATION,
TRANSTECHNOLOGY XXXXXX-ORBIS GmbH,
XXXXXXXX INTERNATIONAL LIMITED,
THE LENDERS REFERRED TO HEREIN,
BANKBOSTON, N.A.,
acting through its London Branch,
as Sterling Fronting Bank,
BHF-BANK AKTIENGESELLSCHAFT,
as DM Fronting Bank,
and
BANKBOSTON, N.A.
as Agent and Issuing Bank
Arranged by:
BANCBOSTON SECURITIES, INC.
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TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION...................................................1
1.1. Definitions....................................................................1
1.2. Rules of Interpretation........................................................23
2. THE REVOLVING CREDIT FACILITY.............................................................23
2.1. Commitment to Lend..............................................................23
2.2. Revolving Credit Commitment Fee. ...............................................24
2.3. Reduction of Total Revolving Credit Commitment..................................24
2.4. The Revolving Credit Notes......................................................24
2.5. Interest on Revolving Credit Loans..............................................25
2.6. Requests for Revolving Credit Loans.............................................25
2.7. Conversion Options..............................................................26
2.7.1. Conversion to Different Type of Revolving Credit Loan. .............26
2.7.2. Continuation of Type of Revolving Credit Loan. .....................26
2.7.3. Eurocurrency Rate Loans..............................................27
2.8 Funds for Revolving Credit Loans.................................................27
2.9. Maturity of Revolving Credit Loans..............................................27
2.10. Mandatory Repayments of Revolving Credit Loans.................................27
2.11. Optional Repayments of Revolving Credit Loans..................................27
3. INTERNATIONAL CREDIT FACILITY.............................................................28
3.1. DM Facility Loans..............................................................28
3.2. Mandatory Repayments of DM Facility Loans.......................................29
3.3. Sterling Facility Loans........................................................29
3.4. Mandatory Repayments of Sterling Facility Loans................................29
3.5. Interest on International Facility Loans.......................................30
3.6. Requests for DM Eurocurrency Loans.............................................30
3.7. Requests for Sterling Eurocurrency Loans.......................................31
3.8. Evidence of DM Facility Loans..................................................31
3.9. Evidence of Sterling Facility Loans............................................31
3.10. Maturity of DM Facility Loans.................................................32
3.11. Maturity of Sterling Facility Loans...........................................32
3.12. Optional Repayment of International Facility Loans.............................32
3.13. DM Facility Commitment Fee.....................................................33
3.14. Sterling Facility Commitment Fee...............................................33
4. MANDATORY PREPAYMENT OF LOANS..............................................................34
4.1. Mandatory Prepayments from Asset Sales or New Debt..............................34
4.2. Mandatory Prepayments from New Equity...........................................34
4.3. Application of Proceeds.........................................................34
5. LETTERS OF CREDIT. ........................................................................34
5.1. Letter of Credit Commitments....................................................34
5.1.1. Commitment to Issue Letters of Credit................................35
5.1.2. Letter of Credit Applications........................................35
5.1.3. Terms of Letters of Credit...........................................35
5.1.4. Reimbursement Obligations of Lenders.................................35
5.1.5. Participations of Lenders............................................36
5.2. Reimbursement Obligation of TransTechnology.....................................36
5.3. Letter of Credit Payments.......................................................37
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5.4. Obligations Absolute............................................................37
5.5. Reliance by Issuing Bank........................................................38
5.6. Letter of Credit Fee............................................................38
5.7. Resignation of Issuing Bank.....................................................39
6. CERTAIN GENERAL PROVISIONS.................................................................39
6.1. Closing and Structuring Fees....................................................39
6.2. Agent's Fee.....................................................................40
6.3. Payment Provisions.............................................................40
6.3.1. Currency of Account..................................................40
6.3.2. Application of Interest Payments.....................................40
6.3.3. Judgment Currency....................................................41
6.3.4. Time of Payment......................................................41
6.3.5. Payments by Agent....................................................41
6.3.6. No Offset, etc.......................................................42
6.4. Computations....................................................................42
6.5. Inability to Determine Eurocurrency Rate........................................42
6.6. Illegality......................................................................43
6.7. Additional Costs, etc...........................................................43
6.8. Capital Adequacy................................................................45
6.9. Certificate.....................................................................45
6.10. Indemnity......................................................................46
6.11. Interest After Default.........................................................46
6.11.1. Overdue Amounts.....................................................46
6.11.2. Amounts Not Overdue.................................................46
6.12. Fronting Bank Provisions.......................................................46
6.12.1. Fronting Fee........................................................47
6.12.2. Indemnities.........................................................47
6.12.3. Resignation of Fronting Bank........................................48
6.12.4. Notice to Lenders. ...............................................49
6.13. Limits on Number of Separate Eurocurrency Rate Loans...........................49
7. COLLATERAL SECURITY AND GUARANTIES.........................................................49
7.1. Security of Borrowers...........................................................49
7.2. Guaranties and Security of Subsidiaries.........................................50
7.3.Pledges of Stock..................................................................49
7.4.Guarantees and Pledges of Assets of Foreign Subsidiaries..........................49
8. REPRESENTATIONS AND WARRANTIES.............................................................50
8.1. Corporate Authority.............................................................51
8.1.1. Incorporation; Good Standing.........................................51
8.1.2. Authorization........................................................50
8.1.3. Enforceability.......................................................50
8.2.Governmental Approvals............................................................51
8.3.Title to Properties; Leases.......................................................51
8.4. Financial Statements and Projections............................................52
8.4.1. Financial Statements................................................52
8.4.2. Projections.........................................................52
8.5. No Material Changes, etc........................................................53
8.6. Franchises, Patents, Copyrights, etc............................................53
8.7. Litigation......................................................................53
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8.8. No Materially Adverse Contracts, etc............................................54
8.9. Compliance with Other Instruments, Laws, etc....................................54
8.10. Tax Status.....................................................................54
8.11. No Event of Default............................................................54
8.12. Holding Company and Investment Company Acts....................................54
8.13. Absence of Financing Statements, etc...........................................55
8.14. Perfection of Security Interest................................................55
8.15. Certain Transactions...........................................................55
8.16. Employee Benefit Plans.........................................................55
8.16.1. In General..........................................................55
8.16.2. Terminability of Welfare Plans......................................56
8.16.3. Guaranteed Pension Plans............................................56
8.16.4. Multiemployer Plans.................................................56
8.16.5. Compliance with Employment Benefit Laws.............................57
8.17. Use of Proceeds................................................................57
8.18. Environmental Compliance.......................................................57
8.19. Subsidiaries, etc..............................................................58
8.20. Bank Accounts..................................................................58
8.21. Year 2000 Compliance...........................................................58
9. AFFIRMATIVE COVENANTS OF THE BORROWERS.....................................................59
9.1. Punctual Payment................................................................59
9.2. Maintenance of Offices..........................................................59
9.3. Records and Accounts............................................................60
9.4. Financial Statements, Certificates and Information..............................60
9.5. Notices.........................................................................61
9.5.1. Defaults.............................................................61
9.5.2. Environmental Events.................................................61
9.5.3. Notification of Claims against Collateral............................62
9.5.4. Notice of Litigation and Judgments...................................62
9.6. Corporate Existence; Maintenance of Properties..................................62
9.7. Insurance.......................................................................63
9.8. Taxes...........................................................................63
9.9. Inspection of Properties and Books, etc.........................................63
9.9.1. General..............................................................63
9.9.2. Environmental Assessments............................................64
9.9.3. Communications with Accountants......................................64
9.10. Compliance with Laws, Contracts, Licenses, and Permits.........................65
9.11. Employee Benefit Plans.........................................................65
9.12. Use of Proceeds................................................................65
9.13. Additional Mortgaged Property..................................................65
9.14. Bank Accounts..................................................................66
9.15. Interest Rate Protection.......................................................66
9.16. Further Assurances.............................................................66
10. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS...............................................66
10.1. Restrictions on Indebtedness...................................................67
10.2. Restrictions on Liens..........................................................68
10.3. Restrictions on Investments....................................................69
10.4. Distributions..................................................................70
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10.5. Merger, Consolidation and Disposition of Assets................................70
10.5.1. Mergers and Acquisitions............................................70
10.5.2. Disposition of Assets...............................................71
10.6. Sale and Leaseback.............................................................72
10.7. Compliance with Environmental Laws.............................................72
10.8. Subordinated Debt..............................................................72
10.9. Employee Benefit Plans.........................................................72
10.10. Bank Accounts.................................................................73
10.11. Operating Leases..............................................................73
00.00.XX OHG Partnership Agreement....................................................71
10.13.Maintenance of Business.........................................................71
11. FINANCIAL COVENANTS OF THE BORROWERS......................................................74
11.1. Consolidated EBITDA to Consolidated Total Interest Expense.....................74
11.2. Debt to Capital Ratio..........................................................74
11.3. Leverage.Ratio.................................................................74
11.4. Minimum Net Worth..............................................................74
11.5. Capital Expenditures...........................................................74
12. CLOSING CONDITIONS. ......................................................................75
12.1. Loan Documents.................................................................75
12.2. Certified Copies of Charter Documents..........................................75
12.3. Corporate Action...............................................................76
12.4. Incumbency Certificate.........................................................76
12.5. Validity of Liens..............................................................76
12.6. Perfection Certificates and UCC Search Results.................................76
12.7. Surveys........................................................................76
12.8. Title Insurance................................................................77
12.9. Landlord Consents..............................................................77
12.10. Certificates of Insurance.....................................................77
12.11. Bank Agency Agreements........................................................77
12.12. Hazardous Waste Assessments...................................................77
12.13. Solvency Certificate..........................................................77
12.14. Opinions of Counsel...........................................................78
12.15. Payment of Fees...............................................................78
13. CONDITIONS TO ALL BORROWINGS..............................................................75
13.1. Representations True; No Event of Default......................................78
13.2. No Legal Impediment............................................................79
13.3. Governmental Regulation........................................................79
13.4. Proceedings and Documents......................................................79
14. EVENTS OF DEFAULT; ACCELERATION; ETC......................................................80
14.1. Events of Default and Acceleration.............................................80
14.2. Termination of Commitment......................................................83
14.3. Remedies.......................................................................83
14.4. Distribution of Collateral Proceeds............................................84
15. SETOFF. ..................................................................................84
16. THE AGENT. ...............................................................................85
16.1. Authorization..................................................................85
16.2. Employees and Agents...........................................................86
16.3. No Liability...................................................................86
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16.4. No Representations.............................................................87
16.5. Payments.......................................................................87
16.5.1. Payments to Agent...................................................87
16.5.2. Distribution by Agent...............................................87
16.5.3. Delinquent Lenders..................................................88
16.6. Holders of Notes...............................................................88
16.7. Indemnity......................................................................88
16.8. Agent as Lender................................................................89
16.9. Resignation of Agent...........................................................89
17. EXPENSES. ................................................................................89
18. INDEMNIFICATION. .........................................................................91
19. SURVIVAL OF COVENANTS, ETC................................................................91
20. ASSIGNMENT AND PARTICIPATION..............................................................92
20.1. Conditions to Assignment.......................................................92
20.2. Certain Representations and Warranties; Limitations; Covenants.................92
20.3. Register.......................................................................94
20.4. New Notes......................................................................94
20.5. Participations.................................................................95
20.6. Disclosure.....................................................................95
20.7. Assignee or Participant Affiliated with TransTechnology........................95
20.8. Miscellaneous Assignment Provisions............................................96
20.9. Assignment by the Borrowers....................................................96
20.10. Syndication...................................................................91
21. NOTICES, ETC. ............................................................................96
22. GOVERNING LAW. ...........................................................................97
23. HEADINGS. ................................................................................98
24. COUNTERPARTS. ............................................................................99
25. ENTIRE AGREEMENT, ETC. ...................................................................99
26. WAIVER OF JURY TRIAL. ....................................................................99
27. CONSENTS, AMENDMENTS, WAIVERS, ETC........................................................99
27.1. Voting Procedures..............................................................99
27.2. Borrowers' Consent Not Required for Certain Amendments.........................101
27.3. Course of Dealing..............................................................101
28. SEVERABILITY. ............................................................................101
29. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.............................................95
29.1. Sharing of Information with Section 20 Subsidiary..............................101
29.2. Confidentiality................................................................102
29.3. Prior Notification.............................................................102
29.4. Other..........................................................................102
30.TRANSITIONAL ARRANGEMENTS...................................................................97
30.1. Original Credit Agreement Superseded...........................................97
30.2. Interest and Fees Under Superseded Agreement...................................103
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List of Schedules and Exhibits
Exhibits
Exhibit A - Revolving Credit Note
Exhibit B - Form of Loan Request
Exhibit C - Compliance Certificate
Exhibit D - Form of Assignment and Acceptance
Schedules
Schedule 1 - The Lenders
Schedule 8.3 - Title to Properties
Schedule 8.7 - Litigation
Schedule 8.10 - Tax Compliance
Schedule 8.16.5 - Compliance with Employee Benefit Laws
Schedule 8.18 - Environmental Compliance
Schedule 8.19 - Subsidiaries
Schedule 8.20 - Bank Accounts
Schedule 10.1 - Existing Indebtedness
Schedule 10.2 - Existing Liens
Schedule 10.3 - Existing Investments
Schedule 10.5.2 - Disposable Assets
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AMENDED AND RESTATED
CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT is made as of June 30, 1995,
and amended and restated as of July 24, 1998, by and among TRANSTECHNOLOGY
CORPORATION, a Delaware corporation having its principal place of business at
000 Xxxxx Xxxx, Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000, XXX ("TransTechnology"),
TRANSTECHNOLOGY XXXXXX-ORBIS GMBH, a German limited liability company having its
principal place of business on the date hereof at Konigstein, Germany ("GmbH"),
XXXXXXXX INTERNATIONAL LIMITED, an English limited liability company (registered
no. 3062174) having its registered office at P.O. Box 6, Ferncliffe Road,
Bingley, Xxxx Xxxxxxxxx XX00 0XX, Xxxxxxx ("Limited"), BANKBOSTON, N.A., a
United States national banking association ("BankBoston") and the other lending
institutions listed on Schedule 1 (BankBoston and such other institutions,
collectively, the "Lenders"), BANKBOSTON, N.A., acting through its London
Branch, as Sterling Fronting Bank (the "Sterling Fronting Bank"), BHF-BANK
AKTIENGESELLSCHAFT, as DM Fronting Bank (the "DM Fronting Bank"), BANKBOSTON,
N.A., as issuing bank (in such capacity, the "Issuing Bank") and BANKBOSTON,
N.A., as Agent for the Lenders, the Sterling Fronting Bank, the DM Fronting Bank
and the Issuing Bank (in such capacity, the "Agent").
WHEREAS, pursuant to the Revolving Credit and Term Loan Agreement dated
as of June 30, 1995 (as amended and in effect from time to time, the "Original
Credit Agreement"), by and among the Borrowers, BankBoston (then known as The
First National Bank of Boston), the other Lenders (as defined therein) (as
defined therein) and BankBoston, as Agent, the Lenders party thereto made loans
to the Borrowers to make certain acquisitions and for general corporate
purposes; and
WHEREAS, the Borrowers have requested, among other things, to amend and
restate the Original Credit Agreement, and the Lenders and the Agent are willing
to amend the Original Credit Agreement on the terms and conditions set forth
herein;
NOW, THEREFORE, the Borrowers, the Lenders and the Agent agree that on
the Closing Date the Original Credit Agreement and all Schedules and Exhibits
thereto are hereby amended and restated in their entirety as set forth herein
and in the Schedules and Exhibits hereto and shall remain in full force and
effect only as set forth herein.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this Section 1 or elsewhere in the provisions of this Credit Agreement
referred to below:
Acquisition Closing Date. The date of completion of any Approved
Acquisition.
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Acquisition Documents. As to any Approved Acquisition, the purchase and
sale agreement with respect to such acquisition, and any other related documents
to be executed and/or delivered in connection therewith.
Affiliate. With respect to any Person, any other Person that would be
considered to be an affiliate of such Person under Rule 144(a) of the Rules and
Regulations of the Securities and Exchange Commission, as in effect on the date
hereof, if such Person were issuing securities.
Agent's Head Office. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time.
Agent's Special Counsel. Xxxxxxx Xxxx LLP, or such other counsel as may
be approved by the Agent.
Applicable Margin. For each period commencing on a Reset Date through
the date immediately preceding the next Reset Date (each such period, a "Rate
Setting Period"), the Applicable Margin shall be the applicable percentage set
forth in the chart below (the "Pricing Grid") based upon the Leverage Ratio as
determined for the Reference Period ended on the last day of the fiscal quarter
ended immediately preceding the applicable Rate Setting Period.
Applicable Margin
Leverage Ratio Base Rate Eurocurrency Commitment
Loans Rate Loans Fee Rate
2.00:1 or lower 0% 1.0% .25%
2.50:1 or lower, but higher than 0% 1.25% .30%
2.00:1
3.00:1 or lower, but higher than 0% 1.5% .375%
2.50:1
3.50:1 or lower, but higher than 0.25% 1.75% .5%
3.00:1
Higher than 3.50:1 0.5% 2.0% .5%
Notwithstanding the foregoing, from the Closing Date until the earlier
of the Placing Date and December 31, 1998, (i) the Commitment Fee Rate shall not
be less than 0.30%, and (ii) the Applicable Margin with respect to Eurocurrency
Rate Loans and Letter of Credit Fees shall not be less than 1.25%.
If no Compliance Certificate is delivered when required by Section
9.4(c), then, for the period commencing on the next Reset Date following the
date on which such delivery was required through the date immediately following
the date of actual delivery to the Agent of such Compliance Certificate, the
Applicable Margin and the Commitment Fee Rate shall be set at the highest
applicable rate or margin set forth above.
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Approved Acquisition. An acquisition by any member of the
TransTechnology Group of the shares or of substantially all of the assets of a
corporation or business, as the case may be, whose operations are substantially
concentrated in the Business (such corporation or business, the "Target"),
provided that either (i) audited financial statements for the Target are
available for its most recently ended fiscal year and have been delivered to the
Agent and each of the Lenders, and the aggregate consideration payable by the
applicable member of the TransTechnology Group either (A) does not exceed
$30,000,000 in cash on the Acquisition Closing Date with respect thereto, or (B)
is payable in shares of capital stock of TransTechnology, or (ii) such
acquisition is approved in writing prior to the closing date thereof by the
Majority Lenders, and provided further that in each case, each of the following
conditions, if applicable, are either fulfilled or are waived in writing by the
Majority Lenders:
(a) the sum of (i) the purchase price payable for the Target
(including all deferred amounts), plus (ii) all Indebtedness
of the Target being assumed by the purchaser in connection
with the acquisition, shall not exceed seven (7) times the
Target's Consolidated EBITDA (mutatis mutandis to reflect such
amount's reference to the Target) for the Reference Period
ended on the last day of the fiscal quarter ended immediately
preceding the proposed Acquisition Closing Date;
(b) the acquisition of the Target is to be concluded pursuant to
negotiated agreements with the Target or its owners or other
controlling interests and approved by the Target's board of
directors or other governing body, and not as a result of a
hostile tender or otherwise without the Target's acquiescence;
(c) upon completion of the proposed acquisition, the assets of the
Target shall be subject to no lien, encumbrance, mortgage,
pledge, charge, restriction or other security other than liens
which would be Permitted Liens hereunder and lessor's
interests under the Capitalized Leases of the Target being
assumed by the purchaser;
(d) no Default or Event of Default shall have occurred and be
continuing at the time of completion of the proposed
acquisition, and no Default or Event of Default would result
therefrom;
(e) without limiting the requirement in clause (d) above, (i) upon
completion of the proposed acquisition TransTechnology and its
Subsidiaries (including the Target from and after the proposed
date of completion of such acquisition) shall be in compliance
with the financial covenants set forth in Section 11 following
acquisition of the Target assuming total outstanding amounts
of and interest rates on the Loans, to be the same as those in
effect on the applicable Acquisition Closing Date after
completion of such acquisition, and (ii) in the event that the
total consideration payable in connection with such
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acquisition exceeds $10,000,000, TransTechnology shall have
delivered to the Agent prior to the applicable Acquisition
Closing Date pro forma financial statements in form and
substance satisfactory to the Agent evidencing such
compliance, certified by the principal financial or accounting
officer of TransTechnology;
(f) the Agent shall have received documentation (including,
without limitation, legal opinions and other documentation
similar to that required to be delivered in connection with
the completion of this Credit Agreement) satisfactory to it in
its sole discretion granting first priority liens in its
favor, on behalf of the Lenders, on the assets and, if
applicable, the shares of the Target and on the assets and, if
applicable, the shares of any member of the TransTechnology
Group acquiring the Target's assets or shares, as the case may
be;
(g) if the Target's assets include any freehold interests in real
property, the Agent shall have received Phase One
environmental site assessments and appraisals of such real
property in form and substance reasonably satisfactory to the
Agent;
(h) upon completion of any proposed acquisition by purchase of the
shares or other equity interests of the Target, the Target
shall either be merged with and into TransTechnology or one of
its Subsidiaries, with TransTechnology or such Subsidiary as
the surviving entity, or, if the Target continues in existence
as a Subsidiary of TransTechnology or one of its Subsidiaries,
it shall do so in compliance with and subject to the
conditions set forth herein;
(i) the Target's operating income, determined in accordance with
generally accepted accounting principles, for the twelve (12)
months immediately preceding the proposed Acquisition Closing
Date shall be greater than zero;
(k) the proposed Acquisition Closing Date shall be no later than
the date two (2) years prior to the Revolving Credit Loan
Maturity Date; and
(l) the Agent and the Lenders shall have received reasonably
detailed written notice of the proposed acquisition at least
fifteen (15) Business Days' prior to the proposed Acquisition
Closing Date.
Arranger. BancBoston Securities, Inc.
Assignment and Acceptance. See Sections 20.1.1 and 20.1.2.
Balance Sheet Date. March 31, 1998.
BankBoston. See the preamble to this Credit Agreement.
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Base Rate. With respect to amounts denominated in Dollars, the Dollar
Base Rate; with respect to amounts denominated in Deutschmarks, the DM Base
Rate; and with respect to amounts denominated in Sterling, the Sterling Base
Rate, with each of the Dollar Base Rate, DM Base Rate and Sterling Base Rate
being referred to herein as a "Base Rate".
Base Rate Loans. Any Revolving Credit Loans and International Facility
Loans bearing interest calculated by reference to a Base Rate.
Borrowers. TransTechnology, GmbH and Limited, collectively, and each
individually being referred to as a "Borrower".
Brazilian Pledge Agreement. The Pledge of Quotas dated as of December
31, 1995, made by GmbH (as managing general partner of SO OHG) and Xxxx
Xxxxxxxxxx in favor of the Agent with respect to the share capital of the
Brazilian Subsidiary, as amended and in effect from time to time.
Brazilian Subsidiary. Xxxxxx-Xxxx Industria e Commercio Ltda., a
Brazilian corporation.
Business. The businesses engaged in by TransTechnology and its
Subsidiaries at the Closing Date, and businesses reasonably related or
incidental thereto.
Business Day. Any day (other than a Saturday or Sunday) on which
banking institutions in Boston, Massachusetts, are open for the transaction of
banking business and, in the case of Eurocurrency Rate Loans, DM Loans and
Sterling Loans, also a day which is a Eurocurrency Business Day.
Capital Assets. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); provided that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with generally accepted
accounting principles.
Capital Expenditures. Amounts paid or indebtedness incurred by
TransTechnology or any of its Subsidiaries in connection with the purchase or
lease by TransTechnology or any of its Subsidiaries of Capital Assets that would
be required to be capitalized and shown on the balance sheet of such Person in
accordance with generally accepted accounting principles.
Capitalized Leases. Leases (unless otherwise stated, under which
TransTechnology or any of its Subsidiaries is the lessee or obligor), the
discounted future rental payment obligations under which are required to be
capitalized on the balance sheet of the lessee or obligor in accordance with
generally accepted accounting principles.
CERCLA. See Section 8.18.
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Charges over Shares. The Charge over Shares, dated June 30, 1995, from
TTSO Inc. in favor of the Agent with respect to 65% of the share capital of
Limited and the Charge over Shares, dated June 30, 1995, from Limited in favor
of the Agent with respect to the entire share capital of Xxxxxxxx (Predecessors)
Limited, each as amended and in effect from time to time.
Closing Date. The first date on which the conditions set forth in
Section 12 have been satisfied and any Revolving Credit Loan or International
Facility Loan are to be made or any Letter of Credit is to be issued hereunder.
Code. The Internal Revenue Code of 1986.
Collateral. All of the property, rights and interests of
TransTechnology and its Subsidiaries that are or are intended to be subject to
the security interests and mortgages created by the Security Documents.
Collateral Assignment of Acquisition Agreement. Any assignment of
rights under any acquisition agreement by TransTechnology or any of its
Subsidiaries in favor of the Agent, for the benefit of the Lenders, in each case
in form and substance satisfactory to the Lenders and the Agent.
Collateral Instrument. Letters of credit, guarantees, indemnities and
performance bonds in form and substance satisfactory to a Fronting Bank issued
or to be issued by such Fronting Bank to or for the account of either GmbH or
Limited, as the case may be, pursuant to Section 3.1 and Section 3.3,
respectively.
Commitment. As to any Lender, such Lender's Revolving Credit Commitment
or commitment to participate in the International Facility Loans, as the case
may be.
Commitment Fee Rate. For each Rate Setting Period, the rate per annum
set forth in the Pricing Grid under the column headed "Commitment Fee Rate" with
respect to the Performance Ratio applicable to such Rate Setting Period.
Compliance Certificate. The certificate delivered pursuant to Section
9.4(c).
Consolidated or consolidated. With reference to any term defined
herein, shall mean that term as applied to the accounts of TransTechnology and
its Subsidiaries, consolidated in accordance with generally accepted accounting
principles.
Consolidated EBITDA. With respect to any Reference Period, Earnings
Before Interest and Taxes for such Reference Period, before provision for any
depreciation and amortization plus, to the extent that during such Reference
Period any Approved Acquisition shall have been completed, the Earnings Before
Interests and Taxes, before provision for any depreciation or amortization,
attributable to the operations of the Target during the period prior to the
applicable Acquisition Closing Date included in such Reference Period, but only
to the extent evidenced by
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-7-
audited financial statements of the Target or as otherwise previously approved
in writing by the Agent and the Majority Lenders, and all as determined in
accordance with generally accepted accounting principles.
Consolidated Net Income (or Deficit). The consolidated net income (or
deficit) of TransTechnology and its Subsidiaries, after deduction of all
expenses, taxes and other proper charges, determined in accordance with
generally accepted accounting principles.
Consolidated Net Worth. The excess of Consolidated Total Assets over
Consolidated Total Liabilities, less, to the extent otherwise includable in the
computation of Consolidated Net Worth, any subscriptions receivable.
Consolidated Total Assets. All assets of TransTechnology and its
Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles.
Consolidated Total Interest Expense. For any period, the aggregate
amount of interest required to be paid or accrued by TransTechnology and its
Subsidiaries during such period on all Indebtedness of TransTechnology and its
Subsidiaries outstanding during all or any part of such period, whether such
interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of
Subordinated Debt or Capitalized Leases and including commitment fees, agency
fees, facility fees and similar fees or expenses in connection with the
borrowing of money, but excluding the non-cash amortization of fees paid with
respect to the Original Credit Agreement, or pursuant to Sections 6.1 and
6.2 under the Credit Agreement on the Closing Date.
Consolidated Total Liabilities. All liabilities of TransTechnology and
its Subsidiaries determined on a consolidated basis in accordance with generally
accepted accounting principles and all Indebtedness of TransTechnology and its
Subsidiaries, whether or not so classified.
Conversion Request. A notice given by a Borrower to the Agent or a
Fronting Bank, as the case may be, of such Borrower's election to convert or
continue a Loan in accordance with Section 2.7.
Copyright Mortgages. Any Copyright Mortgage and Security Agreements
made by TransTechnology or any of its Subsidiaries in favor of the Agent and in
form and substance satisfactory to the Lenders and the Agent.
Counter Indemnity. Any indemnity or counter indemnity from GmbH or
Limited, as the case may be, in favor of the DM Fronting Bank or the Sterling
Fronting Bank, as applicable, with respect to any Collateral Instrument issued
to or for the account of either GmbH or Limited, in the standard form of
indemnity or counter indemnity used by such Fronting Bank or in such other form
and substance as may be satisfactory to such Fronting Bank and including
(without limitation) any
15
-8-
letter of credit application incorporating indemnification language satisfactory
to such Fronting Bank.
Credit Agreement. This Amended and Restated Credit Agreement, including
the Schedules and Exhibits hereto.
Debentures. The Debenture dated January 3, 1996 made by Limited in
favor of the Agent, and the Debenture dated June 30, 1995 made by Xxxxxxxx
(Predecessors) Limited in favor of the Agent, in each case as amended and in
effect from time to time.
Default. See Section 14.1.
Deutschmarks or DM. Deutschmarks in lawful currency of the Federal
Republic of Germany, or any unit of currency replacing the Deutschmark as the
lawful currency of the Federal Republic of Germany in accordance with European
laws or regulations.
Distribution. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of TransTechnology, other
than dividends payable solely in shares of common stock of TransTechnology; the
purchase, redemption, or other retirement of any shares of any class of capital
stock of TransTechnology, directly or indirectly through a Subsidiary of
TransTechnology or otherwise; the return of capital by TransTechnology to its
shareholders as such; or any other distribution on or in respect of any shares
of any class of capital stock of TransTechnology.
DM Base Rate. The annual rate of interest announced from time to time
by the DM Fronting Bank as its "base rate" for loans denominated in
Deutschmarks.
DM Equivalent. On any date of determination, with respect to an amount
denominated in Deutschmarks, such amount of Deutschmarks, and with respect to an
amount denominated in Sterling or Dollars, the amount of Deutschmarks which
could be purchased with that amount of Sterling or Dollars, as the case may be,
at the spot rate of exchange quoted by the DM Fronting Bank in the Frankfurt
Foreign Exchange Market at or about 11:00 a.m. (Frankfurt time) on the date of
determination for the purchase of Deutschmarks with Sterling or Dollars, as the
case may be.
DM Eurocurrency Loan. See Section 3.1
DM Eurocurrency Rate. For any Interest Period with respect to a DM
Loan, the rate of interest equal to the rate per annum (rounded upwards to the
nearest 1/16 of one percent) at which the DM Fronting Bank is offered deposits
in Deutschmarks two (2) Eurocurrency Business Days prior to the beginning of
such Interest Period in the Frankfurt interbank market for delivery on the first
day of such Interest Period for the number of days comprised therein and in an
amount comparable to the amount of the DM Loan to which such Interest Period
applies,
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-9-
divided by (ii) a number equal to 1.00 minus the Eurocurrency Reserve Rate, if
applicable.
DM Facility Loans. The DM Eurocurrency Loans and the DM Overdraft
Advances, collectively.
DM Fronting Bank. Initially, the head office in Frankfurt, Germany, of
BHF-BANK Aktiengesellschaft, in its capacity as DM Fronting Bank, and thereafter
such office as may be appointed as successor DM Fronting Bank in accordance with
Section 6.12.3.
DM Loan. Any International Facility Loan which is denominated in
Deutschmarks.
DM Overdraft Advance. See Section 3.1.
Dollar Base Rate. The higher of (i) the annual rate of interest
announced from time to time by the Agent at its Head Office in Boston,
Massachusetts, as its "base rate" for loans denominated in Dollars, and (ii)
one-half of one percent (1/2%) above the Federal Funds Effective Rate. For the
purposes of this definition, "Federal Funds Effective Rate" shall mean for any
day, the rate per annum equal to the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve System arranged
by federal funds brokers, as published for such day (or, if such day is not a
Business Day, for the next preceding Business Day) by the Federal Reserve Bank
of New York, or, if such rate is not so published for any day that is a Business
Day, the average of the quotations for such day on such transactions received by
the Agent from three funds brokers of recognized standing selected by the Agent.
Dollar Equivalent. On any date of determination, with respect to an
amount denominated in Dollars, such amount of Dollars, and with respect to an
amount denominated in Sterling or Deutschmarks, the amount of Dollars which
could be purchased with that amount of Sterling or Deutschmarks, as the case may
be, at the spot rate of exchange quoted by the Fronting Bank in the London
Foreign Exchange Market at or about 11:00 a.m. (London time) on the date of
determination for the purchase of Dollars with Sterling or Deutschmarks, as the
case may be.
Dollars or $. Dollars in lawful currency of the United States of
America.
Domestic Lending Office. Initially, the office of each Lender
designated as such in Schedule 1 hereto and thereafter, such other office of
such Lender, if any, located within the United States that will be making or
maintaining Base Rate Loans.
Domestic Subsidiaries. Those Subsidiaries of TransTechnology which are
incorporated in or organized under the laws of any state, district or territory
of the United States or of the Commonwealth of Puerto Rico.
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-10-
Drawdown Date. The date on which any Revolving Credit Loan or any
International Facility Loan is made or is to be made, and the date on which any
Loan or is converted or continued in accordance with Section 2.7, as the case
may be.
Earnings Before Interest and Taxes. The consolidated earnings (or loss)
from the operations of TransTechnology and its Subsidiaries for any period,
after all expenses and other proper charges but before payment or provision for
any income taxes or interest expense for such period, determined in accordance
with generally accepted accounting principles, after eliminating therefrom all
non-recurring items of income (or loss) resulting from the discontinuation of
operations to the extent that all assets characterized as belonging to or being
employed in such operations are also excluded from Consolidated Total Assets
pursuant to the definition thereof.
Eligible Assignee. Any of (i) a commercial bank or finance company
organized under the laws of the United States, or any State thereof or the
District of Columbia, and having total assets in excess of $5,000,000,000; (ii)
a savings and loan association or savings bank organized under the laws of the
United States, or any State thereof or the District of Columbia, and having a
net worth of at least $500,000,000, calculated in accordance with generally
accepted accounting principles; (iii) a commercial bank organized under the laws
of any other country which is a member of the Organization for Economic
Cooperation and Development (the "OECD"), or a political subdivision of any such
country, and having total assets in excess of $5,000,000,000, provided that such
bank is acting through a branch or agency located in the country in which it is
organized or another country which is also a member of the OECD; (iv) the
central bank of any country which is a member of the OECD; (v) a Lender; and
(vi) if, but only if, any Event of Default has occurred and is continuing, any
other bank, insurance company, commercial finance company, investment fund or
other financial institution or other Person approved by the Agent, such approval
not to be unreasonably withheld.
Employee Benefit Plan. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by TransTechnology or any
ERISA Affiliate, other than a Multiemployer Plan.
English Guarantees. The Deed of Guarantee and Indemnity, dated June 30,
1995, made by Limited in favor of the Agent, and the Deed of Guarantee of
Indemnity, June 30, 1995, made by Xxxxxxxx (Predecessors) Limited in favor of
the Agent, each as amended and in effect from time to time.
English Security Documents. The Debentures and the Charges over Shares,
as in effect from time to time.
Environmental Laws. See Section 8.18(a).
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA Affiliate. Any Person which is treated as a single employer with
TransTechnology under Section 414 of the Code.
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-11-
ERISA Reportable Event. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder as to which the requirement of notice has not been
waived.
Eurocurrency Business Day. Any day (other than a Saturday or Sunday) on
which commercial banks are open for international business (including dealings
in Dollar, Deutschmark and Sterling deposits) in London, England and
Frankfurt-am-Main, Germany.
Eurocurrency Rate. With respect to amounts denominated in Dollars, the
Eurodollar Rate; with respect to amounts denominated in Deutschmarks, the DM
Eurocurrency Rate; with respect to amounts denominated in Sterling, the Sterling
Eurocurrency Rate.
Eurocurrency Rate Loans. Any Revolving Credit Loans and International
Facility Loans bearing interest calculated by reference to a Eurocurrency Rate.
Eurocurrency Reserve Rate. For any day with respect to a Eurocurrency
Rate Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
Eurodollar Lending Office. Initially, the office of each Lender
designated as such in Schedule 1 hereto, and thereafter, such other office of
such Lender, if any, that shall be making or maintaining Eurocurrency Rate Loans
denominated in Dollars.
Eurodollar Rate. For any Interest Period with respect to a Eurocurrency
Rate Loan denominated in Dollars, the rate of interest equal to (i) the
arithmetic average of the rates per annum for the Reference Bank (rounded
upwards to the nearest 1/16 of one percent) of the rate at which the Reference
Bank's Eurodollar Lending Office is offered Dollar deposits two Eurocurrency
Business Days prior to the beginning of such Interest Period in the interbank
eurodollar market where the eurodollar and foreign currency and exchange
operations of such Eurodollar Lending Office are customarily conducted, for
delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurocurrency
Rate Loan to which such Interest Period applies, divided by (ii) a number equal
to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
Event of Default. See Section 14.1.
Fee Letter. The letter agreement or agreements between BankBoston, the
Arranger and TransTechnology dated or to be dated on or prior to the Closing
Date
19
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with respect to the amount of certain fees payable or to be paid by the
Borrowers jointly and severally (but, in the case of GmbH, subject to Section 30
of the GmbH Act of Germany) under or in respect of this Credit Agreement.
Foreign Subsidiaries. Those Subsidiaries of TransTechnology other than
the Domestic Subsidiaries.
Fronted Loans. The International Facility Loans, with each (and any
portion of each) being individually a "Fronted Loan".
Fronting Banks. The DM Fronting Bank and the Sterling Fronting Bank,
collectively, and each individually a "Fronting Bank".
Funded Indebtedness. At any time of determination, the aggregate
principal amount of all funded Indebtedness for borrowed money (including, for
the avoidance of doubt, all Subordinated Debt of TransTechnology and any of its
Subsidiaries), plus all obligations, contingent and otherwise, to reimburse the
issuer in respect of any letter of credit, performance bonds, bankers'
acceptances, guarantees or other similar instruments, plus Capitalized Leases,
of TransTechnology and its Subsidiaries.
Funding Account. See Section 2.8.1.
generally accepted accounting principles. (i) When used in Section 11,
whether directly or indirectly through reference to a capitalized term used
therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(B) to the extent consistent with such principles, the accounting practice of
TransTechnology reflected in its financial statements for the year ended on the
Balance Sheet Date, and (ii) when used in general, other than as provided above,
means principles that are (A) consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time, and (B) consistently applied with past financial
statements of TransTechnology adopting the same principles, provided that in
each case referred to in this definition of "generally accepted accounting
principles" a certified public accountant would, insofar as the use of such
accounting principles is pertinent, be in a position to deliver an unqualified
opinion (other than a qualification regarding changes in generally accepted
accounting principles) as to financial statements in which such principles have
been properly applied.
German Mortgage. The Real Estate Mortgages dated as of February 28,
1996 and May 30, 1996, together with the German Security Agreement, dated June
23, 1998, entered into by SO OHG in favor of the DM Fronting Bank, as agent for
the Agent and for the benefit of the Lenders, with respect to the real property
at:
(a) Xxxxxxxxxxx Xxxxxxx/Xxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx,
Xxxxxxx (Folio 19-615);
20
-00-
(x) Xxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, Xxxxxxx (Folio 21-699);
and
(c) Frittlingen, Germany (Folio 1349);
as amended in effect from time to time.
German Pledge Agreements. The Pledge of Shares made by TTSO Inc. in
favor of the Agent with respect to the share capital of GmbH, and the pledge of
Partnership Interests by GmbH in favor of the Agent with respect to its interest
as managing general partner of SO OHG, in each case as amended and in effect
from time to time.
German Security Documents. The Pledges as to Equipment and Inventory
and the Assignment of Accounts Receivable dated December 28, 1995 and June 23,
1998, by SO OHG in favor of the DM Fronting Bank, as agent for the Agent and for
the benefit of the Lenders, with respect to all of the equipment, inventory and
accounts receivable of SO OHG, as amended and in effect from time to time, the
German Mortgage, and the German Pledge Agreements.
GmbH. See the preamble to this Credit Agreement.
Guaranteed Pension Plan. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by TransTechnology
or any ERISA Affiliate the benefits of which are guaranteed on termination in
full or in part by the PBGC pursuant to Title IV of ERISA, other than a
Multiemployer Plan.
Guaranties. The Parent Guaranty, the Subsidiary Guaranty and the
English Guarantees.
Guarantor. Each Subsidiary of TransTechnology which is a party to the
Subsidiary Guaranty or the English Guarantees.
Hazardous Substances. See Section 8.18(b).
Indebtedness. All obligations, contingent and otherwise, that in
accordance with generally accepted accounting principles should be classified
upon the obligor's balance sheet as liabilities, or to which reference should be
made by footnotes thereto, including in any event and whether or not so
classified: (i) all debt and similar monetary obligations, whether direct or
indirect; (ii) all liabilities secured by any mortgage, pledge, security
interest, lien, charge or other encumbrance existing on property owned or
acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; and (iii) all guarantees, endorsements and other contingent
obligations whether direct or indirect in respect of indebtedness of others,
including any obligation to supply funds to or in any manner to invest in,
directly or indirectly, the debtor, to purchase indebtedness, or to assure the
owner of indebtedness against loss, through an agreement to purchase goods,
supplies, or services for the purpose of enabling the debtor to make payment of
the indebtedness
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held by such owner or otherwise, and the obligations to reimburse the issuer in
respect of any letters of credit, performance bonds, bankers' acceptances,
guarantees or other similar instruments; but excluding all liabilities in
respect of Operating Leases.
Ineligible Securities. Securities which may not be underwritten or
dealt in by member banks of the Federal Reserve System under Section 16 of the
Banking Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
Interest Payment Date. (i) As to any Base Rate Loan, the first day
after the last day of the Interest Period with respect thereto; and (ii) as to
any Eurocurrency Rate Loan in respect of which the Interest Period is (A) 3
months or less, the last day of such Interest Period, and (B) more than 3
months, the date that is 3 months from the first day of such Interest Period
and, in addition, the last day of such Interest Period.
Interest Period. With respect to each Loan, (i) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the following periods, as selected by the relevant Borrower of such Loan in a
Loan Request: (A) for any Base Rate Loan, a calendar quarter, and (B) for any
Eurocurrency Rate Loan, 1, 2, 3 or 6 months; and (ii) thereafter, each period
commencing on the last day of the next preceding Interest Period applicable to
such Loan and ending on the last day of one of the periods set forth above, as
selected by the relevant Borrower of such Loan in a Conversion Request; provided
that all of the foregoing provisions relating to Interest Periods are subject to
the following:
(a) if any Interest Period with respect to a Eurocurrency Rate
Loan would otherwise end on a day that is not a Eurocurrency Business
Day, that Interest Period shall be extended to the next succeeding
Eurocurrency Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month, in which
event such Interest Period shall end on the immediately preceding
Eurocurrency Business Day;
(b) if any Interest Period with respect to a Base Rate Loan
would end on a day that is not a Business Day, that Interest Period
shall end on the next succeeding Business Day;
(c) if the relevant Borrower shall fail to give notice as
provided in Section 2.7, such Borrower shall be deemed to have
requested a conversion of the affected Eurocurrency Rate Loan to a Base
Rate Loan and the continuance of all Base Rate Loans as Base Rate Loans
on the last day of the then current Interest Period with respect
thereto;
(d) any Interest Period relating to any Eurocurrency Rate Loan
that begins on the last Eurocurrency Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the
last Eurocurrency Business Day of a calendar month; and
22
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(e) any Interest Period relating to any Eurocurrency Rate Loan
that would otherwise extend beyond the Revolving Credit Loan Maturity
Date shall end on the Revolving Credit Loan Maturity Date.
Interest Rate Protection Documents. The documents evidencing the
interest rate cap or swap arrangements entered into by TransTechnology pursuant
to Section 9.15, as such arrangements and the related documents may be amended,
modified, varied or supplemented from time to time.
International Facility Amount. At any time of determination, the Dollar
Equivalent at such time of the sum of the Total DM Facility Usage and the Total
Sterling Facility Usage.
International Facility Loans. The DM Facility Loans made or to be made
by the DM Fronting Bank to GmbH and the Sterling Facility Loans made or to be
made by the Sterling Fronting Bank to Limited, in each case pursuant to Section
3, and all liabilities of GmbH and Limited (whether contingent or otherwise)
incurred or to be incurred in connection with the issuance of Collateral
Instruments and delivery of Counter Indemnities pursuant to Section 3.
International Facility Loan Request. See Sections 3.6 and 3.7.
Investments. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (i) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (ii) there
shall be included as an Investment all interest accrued with respect to
Indebtedness constituting an Investment unless and until such interest is paid;
(iii) there shall be deducted in respect of each such Investment any amount
received as a return of capital (but only by repurchase, redemption, retirement,
repayment, liquidating dividend or liquidating distribution); (iv) there shall
not be deducted in respect of any Investment any amounts received as earnings on
such Investment, whether as dividends, interest or otherwise, except that
accrued interest included as provided in the foregoing clause (ii) may be
deducted when paid; and (v) there shall not be deducted from the aggregate
amount of Investments any decrease in the value thereof.
Lenders. The Lenders referred to on Schedule 1 hereto, and, unless the
context otherwise requires, also the Fronting Banks and the Issuing Bank,
collectively, and each individually being referred to as a "Lender".
Letter of Credit. See Section 5.1.1.
Letter of Credit Application. See Section 5.1.1.
23
-16-
Letter of Credit Fees. See Section 5.6.
Letter of Credit Participation. See Section 5.1.4.
Leverage Ratio. As of any date of testing, the ratio of Funded
Indebtedness outstanding at such date to Consolidated EBITDA, calculated for a
Reference Period ended on the last day of the fiscal quarter ended immediately
preceding such date.
Limited. See the preamble to this Credit Agreement.
Loan Documents. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Interest Rate Protection Documents, the
Brazilian Pledge Agreement, the Counter Indemnities and the Security Documents,
together with any other documents from time to time entered into and identified
therein as a "Loan Document" hereunder.
Loan Request. A Revolving Credit Loan Request or an International
Facility Loan Request.
Loans. The Revolving Credit Loans and the International Facility Loans.
Majority Lenders. As of any date, so long as there is only one Lender,
such Lender, and so long as there are at least two Lenders, two or more Lenders
holding at least fifty-one percent (51%) of the outstanding principal amount of
the Revolving Credit Notes, and if no such Notes are outstanding, two or more
Lenders whose aggregate Commitments constitute at least fifty-one percent (51%)
of the aggregate of the Commitments of all of the Lenders.
Maximum DM Amount. The maximum principal amount of International
Facility Loans denominated in Deutschmarks available to GmbH from the DM
Fronting Bank, as such amount may be increased or reduced from time to time in
accordance with the terms and provisions of this Credit Agreement. At the
Closing Date, prior to the drawdown of any International Facility Loans, the
Maximum DM Amount shall be the DM Equivalent of $10,000,000.
Maximum Drawing Amount. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.
Maximum International Facility Amount. The aggregate amount of the
Maximum DM Amount plus the Maximum Sterling Amount.
Maximum Sterling Amount. The maximum principal amount of International
Facility Loans denominated in Sterling available to Limited from the Sterling
Fronting Bank, as such amount may be reduced from time to time in accordance
with the terms and provisions of this Credit Agreement. At the Closing
24
-17-
Date, prior to the drawdown of any International Facility Loans, the Maximum
Sterling Amount shall be the Sterling Equivalent of $15,000,000.
Mortgaged Property. Any Real Estate which is subject to the German
Mortgage, the Debentures or any other Mortgage.
Mortgages. The several mortgages and deeds of trust from
TransTechnology and its Subsidiaries to the Agent with respect to the fee and
certain leasehold interests of TransTechnology and its Subsidiaries in the Real
Estate, in each case as amended and in effect from time to time.
Multiemployer Plan. Any multiemployer plan within the meaning of
Section 3(37) of ERISA maintained or contributed to by TransTechnology or any
ERISA Affiliate.
Net Cash Proceeds. If from a sale of assets or of equity, the cash
proceeds received from such sale, net of all costs of sale, underwriting or
brokerage costs, and taxes paid or payable as a result thereof by
TransTechnology and its Subsidiaries, and if from the incurring of Indebtedness,
the cash proceeds received from such incurring of Indebtedness, net of all costs
thereof incurred and fees and all expenses payable in connection therewith, and
taxes paid or payable as a result thereof, by TransTechnology and its
Subsidiaries.
Notes. The Revolving Credit Notes.
Obligations. All indebtedness, obligations and liabilities of any of
TransTechnology and its Subsidiaries to any of the Lenders and the Agent,
individually or collectively, existing on the date of this Credit Agreement or
arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Credit Agreement or any of the other Loan Documents or in
respect of any of the Loans made or Reimbursement Obligations incurred or any of
the Notes, Letter of Credit Applications, Letters of Credit, the Interest Rate
Protection Documents, Counter Indemnities or other instruments at any time
evidencing any thereof.
Operating Leases. Leases (unless otherwise stated, under which
TransTechnology or any of its Subsidiaries is the lessee or obligor) of any
property, whether real, personal or mixed, which are not Capitalized Leases.
Original Credit Agreement. See the preamble to this Credit Agreement.
outstanding. With respect to any Loan or the Loans, the aggregate
unpaid principal thereof as of any date of determination.
Parent Guaranty. The Guaranty, dated as of June 30, 1995, made by
TransTechnology in favor of the Agent, pursuant to which TransTechnology
guaranties to the Lenders and the Agent the payment and performance of the
Obligations of GmbH and Limited, as amended and in effect from time to time.
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Partnership Agreement. The partnership agreement of SO OHG entered into
between TTSOB and GmbH, as in effect on October 27, 1995.
Patent Assignment. The Patent Assignment, dated as of June 30, 1995
made by TransTechnology and its Subsidiaries in favor of the Agent, as amended
and in effect from time to time, and any other Patent Assignments made by
TransTechnology or any of its Subsidiaries in favor of the Agent and in form and
substance satisfactory to the Lenders and the Agent.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
Perfection Certificates. The Perfection Certificates as defined in the
Security Agreements.
Permitted Liens. Liens, security interests and other encumbrances
permitted by Section 10.2.
Person. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
Placing Date. The date upon which TransTechnology shall have completed
the placing of at least $80,000,000 in aggregate of Subordinated Debt.
Pricing Grid. See the definition of "Applicable Margin".
Projections. See Section 8.4.3.
Rate Setting Period. See the definition of "Applicable Margin".
Real Estate. All real property at any time owned or leased (as lessee
or sublessee) by TransTechnology or any of its Subsidiaries.
Record. The grid attached to a Note, or the continuation of such grid,
or any other similar record, including computer records, maintained by any
Lender with respect to any Loan referred to in such Note.
Reference Bank. BankBoston.
Reference Period. A period of four (4) consecutive fiscal quarters.
Reimbursement Obligation. TransTechnology's obligation to reimburse the
Agent, the Issuing Bank and the Lenders on account of any drawing under any
Letter of Credit as provided in Section 5.2.
Rental Obligations. All present or future obligations of
TransTechnology or any of its Subsidiaries under any rental agreements or leases
of real or personal property, other than (i) obligations that can be terminated
by the giving of notice
26
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without liability to TransTechnology or such Subsidiary in excess of the
liability for rent due as of the date on which such notice is given and under
which no penalty or premium is paid as a result of any such termination, and
(ii) obligations in respect of Capitalized Leases.
Reset Date. The first Business Day of the month immediately following
the month in which a Compliance Certificate is to be delivered by
TransTechnology pursuant to Section 9.4(c).
Revolving Credit Availability. At any time of reference thereto, the
amount by which the Total Revolving Credit Commitment as in effect at such time
exceeds the aggregate of (a) the outstanding amount of Revolving Credit Loans at
such time (after giving effect to all amounts requested) plus (b) the sum of the
Maximum Drawing Amount, all Unpaid Reimbursement Obligations and the
International Facility Amount at such time.
Revolving Credit Commitment. With respect to each Lender, the amount
set forth on Schedule 1 hereto as the amount of such Lender's commitment to make
Revolving Credit Loans to TransTechnology, to participate in the issuance,
extension and renewal of Letters of Credit for the account of TransTechnology,
and to indemnify the Fronting Banks in accordance with Section 6.12.2, as the
same may be reduced from time to time, or if such commitment is terminated
pursuant to the provisions hereof, zero.
Revolving Credit Commitment Percentage. With respect to each Lender,
the percentage set forth on Schedule 1 hereto as such Lender's percentage of the
aggregate Revolving Credit Commitments of all of the Lenders.
Revolving Credit Loan Maturity Date. July 24, 2003.
Revolving Credit Loans. Revolving credit loans made or to be made by
the Banks to TransTechnology pursuant to Section 2.
Revolving Credit Loan Request. See Section 2.6.
Revolving Credit Note Record. A Record with respect to a Revolving
Credit Note.
Revolving Credit Notes. See Section 2.4.
Section 20 Subsidiary. A Subsidiary of the bank holding company
controlling any Lender, which Subsidiary has been granted authority by the
Federal Reserve Board to underwrite and deal in certain Ineligible Securities.
Security Agreements. The several Security Agreements, dated as of June
30, 1995, between TransTechnology and its Subsidiaries and the Agent, as amended
and in effect from time to time.
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Security Documents. The Guaranties, the Security Agreements, the
Mortgages, the Patent Assignments, the Trademark Assignments, the Copyright
Mortgages, the German Security Documents, the English Security Documents, the
Collateral Assignments of Acquisition Agreements, and the Stock Pledge
Agreements, and any other documents or instruments from time to time securing
any of the Obligations or evidencing such security.
SO OHG. Xxxxxx-Orbis GmbH & Co. OHG, a German general commercial
partnership, at least ninety-nine percent (99%) of whose partnership interests
are held by GmbH and the remainder of whose partnership interests are held by
TTSOB.
Sterling or pound sterling. Pounds sterling in the lawful currency of
the United Kingdom of Great Britain and Northern Ireland.
Sterling Base Rate. The annual rate of interest announced from time to
time by the Sterling Fronting Bank as its "base rate" for loans denominated in
Sterling.
Sterling Equivalent. On any date of determination, with respect to an
amount denominated in Sterling, such amount of Sterling, and with respect to an
amount denominated in Deutschmarks or Dollars, the amount of Sterling which
could be purchased with that amount of Deutschmarks or Dollars, as the case may
be, at the spot rate of exchange quoted by the Sterling Fronting Bank in the
London Foreign Exchange Market at or about 11:00 a.m. (London time) on the date
of determination for the purchase of Sterling with Deutschmarks or Dollars, as
the case may be.
Sterling Eurocurrency Loan. See Section 3.3.
Sterling Eurocurrency Rate. For any Interest Period with respect to a
Sterling Loan, the rate of interest equal to the rate per annum (rounded upwards
to the nearest 1/16 of one percent) at which the Sterling Fronting Bank is
offered deposits in Sterling two (2) Eurocurrency Business Days prior to the
beginning of such Interest Period in the London interbank market for delivery on
the first day of such Interest Period for the number of days comprised therein
and in an amount comparable to the amount of the Sterling Loan to which such
Interest Period applies, divided by (ii) a number equal to 1.00 minus the
Eurocurrency Reserve Rate, if applicable.
Sterling Facility Loans. The Sterling Eurocurrency Loans and the
Sterling Overdraft Advances, collectively.
Sterling Fronting Bank. Initially, the London Branch of BankBoston, in
its capacity as Sterling Fronting Bank; and thereafter such office as may be
appointed as may be appointed as successor Sterling Fronting Bank in accordance
with Section 6.12.3.
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Sterling Loan. Any International Facility Loan which is denominated in
pounds Sterling.
Sterling Overdraft Advance. See Section 3.3.
Stock Pledge Agreements. The Stock Pledge Agreements, dated as of June
30, 1995, between TransTechnology and certain of the Guarantors on the one hand
and the Agent on the other hand with respect to each of the Subsidiaries of
TransTechnology, as amended and in effect from time to time.
Subordinated Debt. Unsecured Indebtedness of TransTechnology or any of
its Subsidiaries in an amount, containing other terms and conditions, and
expressly subordinated and made junior to the payment and performance in full of
the Obligations, pursuant to a written instrument containing subordination
provisions, in each respect satisfactory to and approved by the Majority Lenders
and the Agent in writing.
Subsidiary. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
Subsidiary Guaranty. The Guaranty, dated as of June 30, 1995, made by
each Domestic Subsidiary in favor of the Lenders and the Agent, pursuant to
which each Domestic Subsidiary guaranties to the Lenders and the Agent the
payment and performance of the Obligations, as amended and in effect from time
to time.
Survey. In relation to a Mortgaged Property, an instrument survey of
such Mortgaged Property acceptable to the Agent.
Title Insurance Company. Commonwealth Title Insurance Company.
Title Policy. In relation to each Mortgaged Property located in the
United States of America, an ALTA standard form title insurance policy issued by
the Title Insurance Company (with such reinsurance or co-insurance as the Agent
may require, any such reinsurance to be with direct access endorsements) in such
amount as may be determined by the Agent insuring the priority of the Mortgage
of such Mortgaged Property and that TransTechnology or one of its Subsidiaries
holds marketable fee simple title to such Mortgaged Property, subject only to
the encumbrances permitted by such Mortgage and which shall not contain
exceptions for mechanics liens or persons in occupancy (except as may be
permitted by such Mortgage), shall not insure over any matter except to the
extent that any such affirmative insurance is acceptable to the Agent in its
sole discretion, and shall contain such endorsements and affirmative insurance
as the Agent in its discretion may require.
Total DM Facility Usage. See Section 3.1.
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Total Revolving Credit Commitment. The sum of the Revolving Credit
Commitments of the Banks, as in effect from time to time, being $125,000,000 on
the Closing Date.
Total Shareholders' Equity. At any time of determination, the total
shareholders' equity of the TransTechnology Group at such time, determined in
accordance with generally accepted accounting principles.
Total Sterling Facility Usage. See Section 3.3.
Trademark Assignments. The Trademark Assignment dated as of June 30,
1995, made by TransTechnology and certain of its Subsidiaries in favor of the
Agent, as amended and in effect from time to time, and any other Trademark
Assignments made by TransTechnology or any of its other subsidiaries in favor of
the Agent and in form and substance satisfactory to the Lenders and the Agent.
TransTechnology Group. TransTechnology and all of its Subsidiaries on a
consolidated basis.
TTSO Inc. TransTechnology Xxxxxx Inc., a Delaware corporation, formerly
known as TransTechnology Xxxxxx-Orbis Inc.
TTSOB. Xxxxxx-Orbis Beteiligungsgesellschaft mbH, a German limited
liability company and a wholly-owned subsidiary of GmbH.
Type. As to any Revolving Credit Loan or International Facility Loan,
its nature as a Base Rate Loan or a Eurocurrency Rate Loan.
Uniform Customs. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto adopted
by the Agent in the ordinary course of its business as a letter of credit issuer
and in effect at the time of issuance of such Letter of Credit.
Unpaid Reimbursement Obligation. Any Reimbursement Obligation for which
TransTechnology does not reimburse the Agent and the Lenders on the date
specified in, and in accordance with, Section 5.2.
Voting Stock. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
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Year 2000 Problem. See Section 8.21.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include
such document or agreement as amended, modified or supplemented from
time to time in accordance with its terms and the terms of this Credit
Agreement.
(b) The singular includes the plural and the plural includes
the singular.
(c) A reference to any law includes any amendment or
modification to such law.
(d) A reference to any Person includes its permitted
successors and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have
the meanings assigned to them therein, with the term "instrument" being
that defined under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "Section" refers to that section
of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of
like import shall refer to this Credit Agreement as a whole and not to
any particular section or subdivision of this Credit Agreement.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND.
Subject to the terms and conditions set forth in this Credit Agreement,
each of the Lenders severally agrees to lend to TransTechnology and
TransTechnology may borrow, repay, and reborrow from time to time between the
Closing Date and the Revolving Credit Loan Maturity Date upon notice by
TransTechnology to the Agent given in accordance with Section 2.6, such sums in
Dollars as are requested by TransTechnology up to a maximum aggregate amount
outstanding (after giving effect to all amounts requested) at any one time equal
to such Lender's Revolving Credit Commitment minus such Lender's Revolving
Credit Commitment Percentage of the sum of (a) the Maximum Drawing Amount, (b)
all Unpaid Reimbursement
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Obligations, and (c) the International Facility Amount, provided that the sum of
the outstanding amount of the Revolving Credit Loans (after giving effect to all
amounts requested) plus the Maximum Drawing Amount, all Unpaid Reimbursement
Obligations, and the International Facility Amount shall not at any time exceed
the Total Revolving Credit Commitment. The Revolving Credit Loans shall be made
pro rata in accordance with each Lender's Revolving Credit Commitment
Percentage. Each request for a Revolving Credit Loan hereunder shall constitute
a representation and warranty by TransTechnology that the conditions set forth
in Section 12 and Section 13, in the case of the initial Revolving Credit Loans
to be made on the Closing Date, and Section 13, in the case of all other
Revolving Credit Loans, have been satisfied on the date of such request.
2.2. REVOLVING CREDIT COMMITMENT FEE.
TransTechnology agrees to pay to the Agent for the accounts of the
Lenders in accordance with their respective Revolving Credit Commitment
Percentages a commitment fee calculated at the Commitment Fee Rate per annum on
the average daily amount during each calendar quarter or portion thereof from
the Closing Date to the Revolving Credit Loan Maturity Date by which the Total
Revolving Credit Commitment, minus the sum of (a) the Maximum Drawing Amount,
(b) all Unpaid Reimbursement Obligations and (c) the Maximum International
Facility Amount, exceeds the outstanding amount of Revolving Credit Loans during
such calendar quarter. The revolving credit commitment fee shall be payable
quarterly in arrears on the first day of each calendar quarter with respect to
the immediately preceding calendar quarter, commencing on the first such date
following the date hereof, with a final payment on the Revolving Credit Loan
Maturity Date or any earlier date on which the Revolving Credit Commitments
shall terminate.
2.3. REDUCTION OF TOTAL REVOLVING CREDIT COMMITMENT.
TransTechnology shall have the right at any time and from time to time
upon five (5) Business Days prior written notice to the Agent to reduce by
$1,000,000 or an integral multiple thereof or terminate entirely the Total
Revolving Credit Commitment, whereupon the Revolving Credit Commitments of the
Lenders shall be reduced pro rata in accordance with their respective Revolving
Credit Commitment Percentages of the amount specified in such notice or, as the
case may be, terminated. Promptly after receiving any notice of TransTechnology
delivered pursuant to this Section 2.3, the Agent will notify the Lenders of the
substance thereof. Upon the effective date of any such reduction or termination,
TransTechnology shall pay to the Agent for the respective accounts of the
Lenders the full amount of any commitment fee then accrued on the amount of the
reduction. No reduction or termination of the Revolving Credit Commitments may
be reinstated.
2.4. THE REVOLVING CREDIT NOTES.
The Revolving Credit Loans shall be evidenced by separate promissory
notes of TransTechnology in substantially the form of Exhibit A hereto (each a
"Revolving Credit Note"), dated as of the Closing Date and completed with
appropriate
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insertions. One Revolving Credit Note shall be payable to the order of each
Lender in a principal amount equal to such Lender's Revolving Credit Commitment
or, if less, the outstanding amount of all Revolving Credit Loans made by such
Lender, plus interest accrued thereon, as set forth below. TransTechnology
irrevocably authorizes each Lender to make or cause to be made, at or about the
time of the Drawdown Date of any Revolving Credit Loan or at the time of receipt
of any payment of principal on such Lender's Revolving Credit Note, an
appropriate notation on such Lender's Revolving Credit Note Record reflecting
the making of such Revolving Credit Loan or (as the case may be) the receipt of
such payment. The outstanding amount of the Revolving Credit Loans set forth on
such Lender's Revolving Credit Note Record shall be prima facie evidence of the
principal amount thereof owing and unpaid to such Lender, but the failure to
record, or any error in so recording, any such amount on such Lender's Revolving
Credit Note Record shall not limit or otherwise affect the obligations of
TransTechnology hereunder or under any Revolving Credit Note to make payments of
principal of or interest on any Revolving Credit Note when due.
2.5. INTEREST ON REVOLVING CREDIT LOANS.
Except as otherwise provided in Section 6.11, the Revolving Credit
Loans shall bear interest as follows:
(a) each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at a rate per annum equal to
the sum of (i) the Dollar Base Rate plus (ii) the Applicable Margin
with respect to Base Rate Loans as in effect from time to time; and
(b) each Eurocurrency Rate Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last
day of the Interest Period with respect thereto at a rate per annum
equal to the sum of (i) the Eurodollar Rate determined for such
Interest Period plus (ii) the Applicable Margin with respect to
Eurocurrency Rate Loans as in effect from time to time.
TransTechnology promises to pay interest on each Revolving Credit Loan
in arrears on each Interest Payment Date with respect thereto.
2.6. REQUESTS FOR REVOLVING CREDIT LOANS.
TransTechnology shall give to the Agent written notice in the form of
Exhibit B hereto (or telephonic notice confirmed in writing in the form of
Exhibit B hereto) of each Revolving Credit Loan requested hereunder (a
"Revolving Credit Loan Request") no later than 1:00 p.m. (Boston time) (a) on
the proposed Drawdown Date of any Base Rate Loan, or (b) on the third (3rd)
Eurocurrency Business Day prior to the proposed Drawdown Date of any
Eurocurrency Rate Loan. Each Revolving Credit Loan Request shall specify (i) the
principal amount of the Revolving Credit Loan requested, (ii) the proposed
Drawdown Date of such
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Revolving Credit Loan, (iii) the Interest Period for such Revolving Credit Loan,
and (iv) the Type of such Revolving Credit Loan. Promptly upon receipt of any
such notice, the Agent shall notify each of the Lenders thereof. Each Revolving
Credit Loan Request shall be irrevocable and binding on TransTechnology and
shall obligate TransTechnology to accept the Revolving Credit Loan requested
from the Lenders or, as the case may be, from the Agent on behalf of the
Lenders, on the proposed Drawdown Date therefor. Each Revolving Credit Loan
Request shall be in a minimum aggregate amount of $100,000, or an integral
multiple thereof.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF REVOLVING CREDIT LOAN.
TransTechnology may elect from time to time to convert any
outstanding Revolving Credit Loan to a Revolving Credit Loan of another
Type, provided that (a) with respect to any such conversion of a
Revolving Credit Loan to a Base Rate Loan, TransTechnology shall give
the Agent at least one (1) Business Day prior written notice of such
election; (b) with respect to any such conversion of a Base Rate Loan
to a Eurocurrency Rate Loan, TransTechnology shall give the Agent at
least three (3) Eurocurrency Business Days prior written notice of such
election; (c) with respect to any such conversion of a Eurocurrency
Rate Loan into a Revolving Credit Loan of another Type, such conversion
shall only be made on the last day of the Interest Period with respect
thereto and (d) no Loan may be converted into a Eurocurrency Rate Loan
when any Default or Event of Default has occurred and is continuing.
All or any part of outstanding Revolving Credit Loans of any Type may
be converted into a Revolving Credit Loan of another Type as provided
herein, provided that any partial conversion shall be in an aggregate
principal amount of $1,000,000 or a whole multiple thereof. Each
Conversion Request relating to the conversion of a Revolving Credit
Loan to a Eurocurrency Rate Loan shall be irrevocable by
TransTechnology.
2.7.2. CONTINUATION OF TYPE OF REVOLVING CREDIT LOAN. Any
Revolving Credit Loan of any Type may be continued as a Revolving
Credit Loan of the same Type upon the expiration of an Interest Period
with respect thereto by compliance by TransTechnology with the notice
provisions contained in Section 2.7.1; provided that no Eurocurrency
Rate Loan may be continued as such when any Default or Event of Default
has occurred and is continuing, but shall be automatically converted to
a Base Rate Loan on the last day of the first Interest Period relating
thereto ending during the continuance of any Default or Event of
Default of which officers of the Agent active upon TransTechnology's
account have actual knowledge. In the event that TransTechnology fails
to provide any such notice with respect to the continuation of any
Eurocurrency Rate Loan as such, then such Eurocurrency Rate Loan shall
be automatically converted to a Base Rate Loan on the last day of the
first Interest Period relating thereto. The Agent shall notify the
Lenders promptly when any such automatic conversion contemplated by
this Section 2.7 is scheduled to occur.
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2.7.3. EUROCURRENCY RATE LOANS. Any conversion to or from
Eurocurrency Rate Loans shall be in such amounts and be made pursuant
to such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurocurrency Rate Loans having the same
Interest Period shall not be less than $5,000,000 or a whole multiple
of $1,000,000 in excess thereof.
2.8 FUNDS FOR REVOLVING CREDIT LOANS.
Not later than 2:00 p.m. (Boston time) on the proposed Drawdown Date of
any Revolving Credit Loans, upon receipt of the documents required by
Sections 12 and 13 and the satisfaction of the other conditions set forth
therein, to the extent applicable, the Agent will make available in immediately
available funds the amount of the requested Revolving Credit Loans by
transferring such amount into TransTechnology's account with the Agent's Head
Office, identified as the "TransTechnology Funding Account" (the "Funding
Account").
2.9. MATURITY OF REVOLVING CREDIT LOANS.
TransTechnology promises to pay on the Revolving Credit Loan Maturity
Date, and there shall become absolutely due and payable on the Revolving Credit
Loan Maturity Date, all of the Revolving Credit Loans outstanding on such date,
together with any and all accrued and unpaid interest thereon.
2.10. MANDATORY REPAYMENTS OF REVOLVING CREDIT LOANS.
If at any time the sum of the outstanding amount of the Revolving
Credit Loans, the Maximum Drawing Amount, all Unpaid Reimbursement Obligations
and the International Facility Amount exceeds the Total Revolving Credit
Commitment then TransTechnology shall immediately pay the amount of such excess
to the Agent for the respective accounts of the Lenders for application: first,
to any Unpaid Reimbursement Obligations; second, to the Revolving Credit Loans;
third, to the International Facility Loans; and fourth, to provide to the Agent
cash collateral for Reimbursement Obligations as contemplated by Section 5.2(b)
and (c). Each payment of any Unpaid Reimbursement Obligations or prepayment of
Revolving Credit Loans shall be allocated among the Lenders, in proportion, as
nearly as practicable, to each Reimbursement Obligation or (as the case may be)
the respective unpaid principal amount of each Lender's Revolving Credit Note,
with adjustments to the extent practicable to equalize any prior payments or
repayments not exactly in proportion.
2.11. OPTIONAL REPAYMENTS OF REVOLVING CREDIT LOANS.
TransTechnology shall have the right, at its election, to repay the
outstanding amount of the Revolving Credit Loans, as a whole or in part, at any
time without penalty or premium, provided that any full or partial prepayment of
the outstanding amount of any Eurocurrency Rate Loans pursuant to this Section
2.11 may be made only on the last day of the Interest Period relating thereto,
unless all
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costs in connection with such prepayment are paid in full simultaneously with
such prepayment pursuant to Section 6.10. Each partial prepayment of the
Revolving Credit Loans shall be in an integral multiple of $100,000, shall (in
the case of Eurocurrency Rate Loans) be accompanied by the payment of accrued
interest on the principal prepaid to the date of prepayment, and shall be
applied, in the absence of instruction by TransTechnology, first to the
principal of Base Rate Loans, and then to the principal of Eurocurrency Rate
Loans. Each partial prepayment shall be allocated among the Lenders, in
proportion, as nearly as practicable, to the respective unpaid principal amount
of each Lender's Revolving Credit Note, with adjustments to the extent
practicable to equalize any prior repayments not exactly in proportion.
3. INTERNATIONAL CREDIT FACILITY.
3.1. DM FACILITY LOANS.
Subject to the terms and conditions set forth in this Credit Agreement,
(a) the DM Fronting Bank agrees to lend to GmbH and GmbH may borrow, repay, and
reborrow from time to time between the Closing Date and the Revolving Credit
Loan Maturity Date either (i) upon notice by GmbH to the DM Fronting Bank given
in accordance with Section 3.6, Loans in Deutschmarks for a specified Interest
Period to bear interest at the rate specified in Section 3.5(c) below (the "DM
Eurocurrency Loans"), or (ii) by means of overdraft advances on GmbH's DM
current account with the DM Fronting Bank (the "DM Overdraft Advances"), and (b)
the DM Fronting Bank agrees to issue Collateral Instruments to or for the
account of GmbH upon the DM Fronting Bank's receipt of a duly-completed and
executed Counter Indemnity from GmbH in respect of each such Collateral
Instrument, in form and substance satisfactory to the DM Fronting Bank, provided
that the aggregate amount of all liabilities of GmbH in respect of all such
Counter Indemnities (whether contingent or otherwise) plus the total amount of
DM Eurocurrency Loans and DM Overdraft Advances outstanding at any one time
(after giving effect to all amounts requested) (such aggregate amount being
referred to herein as "Total DM Facility Usage") shall not exceed the DM
Equivalent at such time of $10,000,000, as such amount may be increased pursuant
to the last sentence of this Section 3.1. Each request for a DM Eurocurrency
Loan, each application to the DM Fronting Bank for a Collateral Instrument, and
each acceptance of a DM Overdraft Advance under this Section 3.1 shall
constitute a representation and warranty by GmbH that the conditions set forth
in Section 12 and Section 13, in the case of the initial DM Facility Loans or
Collateral Instruments (if any) to be made or issued on the Closing Date, and
Section 13, in the case of all other DM Facility Loans or Collateral
Instruments, have been satisfied on the date of such request or acceptance, as
the case may be. In the event that prior to December 31, 1998, TransTechnology
or any of its Subsidiaries shall have completed an Approved Acquisition of a
Target whose principal place of business is located in Germany for an aggregate
purchase price of at least $10,000,000, then the Maximum DM Amount shall be
increased from the DM Equivalent of $10,000,000 to the DM Equivalent of
$20,000,000 with effect from the applicable Acquisition Closing Date.
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3.2. MANDATORY REPAYMENTS OF DM FACILITY LOANS.
If at any time, for any reason whatsoever, including without limitation
fluctuations in currency rates, Total DM Facility Usage exceeds by more than 5%
the DM Equivalent at such time of $10,000,000, as such amount may be increased
pursuant to the last sentence of Section 3.1, then GmbH shall immediately pay
the excess amount for application first, to reduce the outstanding amount of DM
Overdraft Advances, second, to provide to the DM Fronting Bank cash cover in
respect of any outstanding Counter Indemnities in favor of the DM Fronting Bank,
and third, to prepay any DM Eurocurrency Loans then outstanding.
3.3. STERLING FACILITY LOANS.
Subject to the terms and conditions set forth in this Credit Agreement,
(a) the Sterling Fronting Bank agrees to lend to Limited and Limited may borrow,
repay, and reborrow from time to time between the Closing Date and the Revolving
Credit Loan Maturity Date either (i) upon notice by Limited to the Sterling
Fronting Bank given in accordance with Section 3.7, Loans in Sterling for a
specified Interest Period to bear interest at the rate specified in Section
3.5(d) below (the "Sterling Eurocurrency Loans"), or (ii) by means of overdraft
advances on Limited's Sterling current account with the Sterling Fronting Bank
(the "Sterling Overdraft Advances"), and (b) the Sterling Fronting Bank agrees
to issue Collateral Instruments to or for the account of Limited upon the
Sterling Fronting Bank's receipt of a duly-completed and executed Counter
Indemnity from Limited in respect of each such Collateral Instrument, in form
and substance satisfactory to the Sterling Fronting Bank, provided that the
aggregate amount of all liabilities of Limited in respect of all such Counter
Indemnities (whether contingent or otherwise) plus the total amount of Sterling
Eurocurrency Loans and Sterling Overdraft Advances outstanding at any one time
(after giving effect to all amounts requested) (such aggregate amount being
referred to herein as "Total Sterling Facility Usage") shall not exceed the
Sterling Equivalent at such time of $15,000,000. Each request for a Sterling
Eurocurrency Loan, each application to the Sterling Fronting Bank for a
Collateral Instrument and each acceptance of a Sterling Overdraft Advance under
this Section 3.3 shall constitute a representation and warranty by Limited that
the conditions set forth in Section 12 and Section 13, in the case of the
initial Sterling Facility Loans or Collateral Instruments (if any) to be made or
issued on the Closing Date, and Section 13, in the case of all other Sterling
Facility Loans or Collateral Instruments, have been satisfied on the date of
such request or acceptance, as the case may be.
3.4. MANDATORY REPAYMENTS OF STERLING FACILITY LOANS.
If at any time, for any reason whatsoever, including without limitation
fluctuations in currency rates, Total Sterling Facility Usage exceeds by more
than 5% the Sterling Equivalent at such time of $15,000,000, then Limited shall
immediately pay the excess amount for application first, to reduce the
outstanding amount of Sterling Overdraft Advances, second to provide to the
Sterling Fronting Bank cash collateral in respect of any outstanding Counter
Indemnities, and third, to prepay any Sterling Eurocurrency Loans then
outstanding.
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3.5. INTEREST ON INTERNATIONAL FACILITY LOANS.
Except as otherwise provided in Section 6.11, the International
Facility Loans shall bear interest as follows:
(a) with respect to DM Overdraft Advances, interest shall be
payable by GmbH on the day-to-day balance in GmbH's current account
maintained with the DM Fronting Bank at a rate per annum equal to the
sum of (i) the DM Base Rate plus (ii) the Applicable Margin with
respect to Base Rate Loans as in effect from time to time; and shall be
deducted from such current account on the last Eurocurrency Business
Day of each calendar month or on such other monthly date as the DM
Fronting Bank may reasonably require such payments;
(b) with respect to Sterling Overdraft Advances, interest
shall be payable by Limited on the day-to-day balance in Limited's
current account maintained with the Sterling Fronting Bank at a rate
per annum equal to the sum of (i) the Sterling Base Rate plus (ii) the
Applicable Margin with respect to Eurocurrency Rate Loans as in effect
from time to time; and shall be deducted from such current account on
the last Eurocurrency Business Day of each calendar month or on such
other monthly date as the Sterling Fronting Bank may reasonably require
such payments;
(c) each DM Eurocurrency Loan shall bear interest for the
period commencing with the Drawdown Date thereof and ending on the last
day of the Interest Period with respect thereto at a rate per annum
equal to the sum of (i) the DM Eurocurrency Rate determined for such
Interest Period plus (ii) the Applicable Margin with respect to
Eurocurrency Rate Loans as in effect from time to time. GmbH promises
to pay interest, in accordance with Section 6.3.2, on each DM
Eurocurrency Loan in arrears on each Interest Payment Date with respect
thereto; and
(d) each Sterling Eurocurrency Loan shall bear interest for
the period commencing with the Drawdown Date thereof and ending on the
last day of the Interest Period with respect thereto at a rate per
annum equal to the sum of (i) the Sterling Eurocurrency Rate determined
for such Interest Period plus (ii) the Applicable Margin with respect
to Eurocurrency Rate Loans as in effect from time to time. Limited
promises to pay interest, in accordance with Section 6.3.2, on each
Sterling Eurocurrency Loan in arrears on each Interest Payment Date
with respect thereto.
3.6. REQUESTS FOR DM EUROCURRENCY LOANS.
GmbH shall give to the DM Fronting Bank written notice substantially in
the form of Exhibit B hereto (or telephonic notice confirmed in a writing in the
form of Exhibit B hereto) of each DM Eurocurrency Loan requested hereunder (an
"International Facility Loan Request") no less than two (2) Eurocurrency
Business Days prior to the proposed Drawdown Date of such Eurocurrency Rate
Loan. Each
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such notice shall specify (a) the principal amount of the Loan requested, (b)
the proposed Drawdown Date of such Loan, (c) the Interest Period for such Loan
and (d) the Type of such Loan. Each International Facility Loan Request for a DM
Eurocurrency Loan shall be irrevocable and binding on GmbH and shall obligate
GmbH to accept the DM Eurocurrency Loan requested on the proposed Drawdown Date
therefor. Each such International Facility Loan Request shall be in a minimum
aggregate amount of the DM Equivalent of $100,000 or an integral multiple
thereof.
3.7. REQUESTS FOR STERLING EUROCURRENCY LOANS.
Limited shall give to the Sterling Fronting Bank written notice
substantially in the form of Exhibit B hereto (or telephonic notice confirmed in
a writing in the form of Exhibit B hereto) of each Sterling Eurocurrency Loan
requested hereunder (also referred to herein as an "International Facility Loan
Request") no less than two (2) Eurocurrency Business Days prior to the proposed
Drawdown Date of such Eurocurrency Rate Loan. Each such notice shall specify (a)
the principal amount of the Loan requested, (b) the proposed Drawdown Date of
such Loan, (c) the Interest Period for such Loan and (d) the Type of such Loan.
Each International Facility Loan Request for a Sterling Eurocurrency Loan shall
be irrevocable and binding on Limited and shall obligate Limited to accept the
Sterling Eurocurrency Loan requested on the proposed Drawdown Date therefor.
Each such International Facility Loan Request shall be in a minimum aggregate
amount of the Sterling Equivalent of $100,000 or an integral multiple thereof.
3.8. EVIDENCE OF DM FACILITY LOANS.
The obligations of GmbH to repay all amounts borrowed by it as DM
Eurocurrency Loans and DM Overdraft Advances, all interest thereon and all other
amounts payable by it in respect thereof shall be evidenced by this Credit
Agreement, it being the intention of the parties hereto that GmbH's obligations
with respect to the DM Facility Loans owed by it is evidenced only as stated
herein and not by separate promissory notes or other instruments.
3.9. EVIDENCE OF STERLING FACILITY LOANS.
The obligations of Limited to repay all amounts borrowed by it as
Sterling Eurocurrency Loans and Sterling Overdraft Advances, all interest
thereon and all other amounts payable by it in respect thereof shall be
evidenced by this Credit Agreement, it being the intention of the parties hereto
that Limited's obligations with respect to the Sterling Facility Loans owed by
it is evidenced only as stated herein and not by separate promissory notes or
other instruments.
3.10. MATURITY OF DM FACILITY LOANS.
GmbH promises to pay on the Revolving Credit Loan Maturity Date, or
such earlier date as the Total Revolving Credit Commitment shall terminate or
the obligations with respect to the International Facility Loans shall be
accelerated in
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accordance with Section 14, and there shall become absolutely due and payable on
the Revolving Credit Loan Maturity Date or such earlier date, all of the DM
Facility Loans outstanding on such date, together with any and all accrued and
unpaid interest thereon, and to provide on such date cash cover satisfactory to
the DM Fronting Bank for the aggregate amount of all liabilities of GmbH
(whether contingent or otherwise) in respect of all Counter Indemnities in favor
of the DM Fronting Bank outstanding on such date.
3.11. MATURITY OF STERLING FACILITY LOANS.
Limited promises to pay on the Revolving Credit Loan Maturity Date, or
such earlier date as the Total Revolving Credit Commitment shall terminate or
the obligations with respect to the International Facility Loans shall be
accelerated in accordance with Section 14, and there shall become absolutely due
and payable on the Revolving Credit Loan Maturity Date or such earlier date, all
of the Sterling Facility Loans outstanding on such date, together with any and
all accrued and unpaid interest thereon, and to provide on such date cash cover
satisfactory to the Sterling Fronting Bank for the aggregate amount of all
liabilities of Limited (whether contingent or otherwise) in respect of all
Counter Indemnities in favor of the Sterling Fronting Bank outstanding on such
date.
3.12. OPTIONAL REPAYMENT OF INTERNATIONAL FACILITY LOANS.
GmbH and Limited shall each have the right, at their election, to repay
the outstanding amount of the DM Facility Loans and Sterling Facility Loans, as
applicable as a whole or in part, at any time without penalty or premium,
provided that any full or partial prepayment of the outstanding amount of any
Eurocurrency Rate Loans pursuant to this Section 3.12 may be made only on the
last day of the Interest Period relating thereto, unless all costs in connection
with such prepayment are paid in full simultaneously with such prepayment
pursuant to Section 6.10. GmbH shall give the DM Fronting Bank, no later than
10:00 a.m., Frankfurt time, at least three (3) Eurocurrency Business Days prior
written notice of any proposed prepayment pursuant to this Section 3.12 of DM
Facility Loans which are Base Rate Loans, and four (4) Eurocurrency Business
Days notice of any proposed prepayment pursuant to this Section 3.12 of DM
Facility Loans which are Eurocurrency Rate Loans, in each case specifying the
proposed date of prepayment of such DM Facility Loans and the principal amount
to be prepaid. Each such partial prepayment of the DM Facility Loans shall be in
an integral multiple of DM50,000. Limited shall give the Sterling Fronting Bank,
no later than 10:00 a.m., London time, at least three (3) Eurocurrency Business
days prior written notice of any proposed prepayment pursuant to this Section
3.12 of Sterling Facility Loans which are Base Rate Loans, and four (4)
Eurocurrency Business Days notice of any proposed prepayment pursuant to this
Section 3.12 of Sterling Facility Loans which are Eurocurrency Rate Loans, in
each case specifying the proposed date of prepayment of such Sterling Facility
Loans and the principal amount to be prepaid. Each such partial prepayment of
the Sterling Facility Loans shall be in an integral multiple of pound
sterling 50,000. Any prepayment pursuant to this Section 3.12 shall be
accompanied by the payment of accrued interest on the principal prepaid to the
date of prepayment, and shall be applied, in the absence
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of instruction by GmbH or Limited, as the case may be, first to outstanding
interest on such International Facility Loans, second to the principal of
International Facility Loans which are Base Rate Loans, third to provide to each
of the Fronting Banks cash cover in respect of any outstanding Counter
Indemnities in favor of such Fronting Bank, and fourth to the principal of
International Facility Loans which are Eurocurrency Rate Loans. Notwithstanding
anything in this Credit Agreement to the contrary, there shall be an interval of
not less than two (2) weeks between each prepayment by GmbH or Limited under
this Section 3.12.
3.13. DM FACILITY COMMITMENT FEE.
GmbH agrees to pay to the DM Fronting Bank, for payment by it to the
Agent for the accounts of the Lenders in accordance with their respective
Revolving Credit Commitment Percentages, a commitment fee calculated at the
Commitment Fee Rate per annum on the average daily amount during each calendar
quarter or portion thereof from the Closing Date to the Revolving Credit Loan
Maturity Date by which the Maximum DM Amount (as such amount may have been
increased pursuant to the last sentence of Section 3.1) exceeds Total DM
Facility Usage during such calendar quarter. Such DM facility commitment fee
shall be payable, in the applicable amount of Deutschmarks or the Dollar
Equivalent thereof on the date of such payment, quarterly in arrears on the
first day of each calendar quarter with respect to the immediately preceding
calendar quarter, commencing on the first such date following the date hereof,
with a final payment on the Revolving Credit Loan Maturity Date or any earlier
date on which the Revolving Credit Commitments shall terminate.
3.14. STERLING FACILITY COMMITMENT FEE.
Limited agrees to pay to the Sterling Fronting Bank, for payment by it
to the Agent for the accounts of the Lenders in accordance with their respective
Revolving Credit Commitment Percentages, a commitment fee calculated at the
Commitment Fee Rate per annum on the average daily amount during each calendar
quarter or portion thereof from the Closing Date to the Revolving Credit Loan
Maturity Date by which the Maximum Sterling Amount exceeds Total Sterling
Facility Usage during such calendar quarter. Such Sterling facility commitment
fee shall be payable, in the applicable amount of Sterling or the Dollar
Equivalent thereof on the date of such payment, quarterly in arrears on the
first day of each calendar quarter with respect to the immediately preceding
calendar quarter, commencing on the first such date following the date hereof,
with a final payment on the Revolving Credit Loan Maturity Date or any earlier
date on which the Revolving Credit Commitments shall terminate.
4. MANDATORY PREPAYMENT OF LOANS.
4.1. MANDATORY PREPAYMENTS FROM ASSET SALES OR NEW DEBT.
In the event that any member of the TransTechnology Group shall either
(a) incur any Indebtedness after the Closing Date which is either permitted
pursuant to
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Section 10.1(f) or is incurred in an amount and on terms and conditions
previously agreed in writing by the Agent, or (b) sell any of its assets (other
than inventory sold in the ordinary course of business) or group of related
assets, whether by sale of such assets or sale of the stock of any member of the
TransTechnology Group, where such asset sale is either permitted pursuant to
Section 10.5.2 or is previously consented to in writing by the Agent and/or the
Majority Lenders, as applicable, then as soon as practicable and in any event
within thirty (30) days after the receipt by any member of the TransTechnology
Group of the Net Cash Proceeds of such new Indebtedness or such asset sale, as
the case may be, TransTechnology shall, or shall procure that a Subsidiary of
TransTechnology shall, prepay the Loans in an amount equal to (i) 50% of the Net
Cash Proceeds of such new Indebtedness, or (ii) 100% of the Net Cash Proceeds of
such asset sale, but only to the extent that the aggregate amount of Net Cash
Proceeds of all such asset sales received by TransTechnology and its
Subsidiaries during any fiscal year ending after the date hereof exceeds
$1,000,000.
4.2. MANDATORY PREPAYMENTS FROM NEW EQUITY.
In the event that any member of the TransTechnology Group shall after
the Closing Date sell or issue any shares of its stock, options (other than
stock options awarded to employees and directors pursuant to incentive
compensation plans operated by members of the TransTechnology Group) or warrants
for the purchase of its stock or other equity or equity instruments, then as
soon as practicable and in any event within thirty (30) days after the sale of
such new equity, TransTechnology shall prepay the Loans in an amount equal to at
least fifty percent (50%) of the Net Cash Proceeds to the TransTechnology Group
of such sale or issuance of new equity.
4.3. APPLICATION OF PROCEEDS.
All mandatory prepayments of the Loans pursuant to Sections 4.1 -
4.2 shall be applied first to repayment of Unpaid Reimbursement Obligations,
second to repayment of Revolving Credit Loans which are Base Rate Loans, third
to repayment of International Facility Loans which are Base Rate Loans, fourth
to provide cash collateral for Reimbursement Obligations and cash cover with
respect to Counter Indemnities, fifth to repayment of Revolving Credit Loans
which are Eurocurrency Rate Loans, and sixth to repayment of International
Facility Loans which are Eurocurrency Rate Loans.
5. LETTERS OF CREDIT.
5.1. LETTER OF CREDIT COMMITMENTS.
5.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by
TransTechnology of a letter of credit application on the Issuing Bank's
customary form (a "Letter of Credit Application"), the Issuing Bank on
behalf of the Lenders and in reliance upon the agreement of the Lenders
set forth in Section 5.1.4 and upon the representations and warranties
of TransTechnology contained herein, agrees, in its individual
capacity, to issue, extend and
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renew for the account of TransTechnology one or more standby or
documentary letters of credit (individually, a "Letter of Credit"), in
such form as may be requested from time to time by TransTechnology and
agreed to by the Issuing Bank; provided, however, that, after giving
effect to such request, (a) the sum of the aggregate Maximum Drawing
Amount and all Unpaid Reimbursement Obligations shall not exceed
$5,000,000 at any one time, and (b) the aggregate outstanding amount of
the Revolving Credit Loans, plus the Maximum Drawing Amount, plus all
Unpaid Reimbursement Obligations, plus the International Facility
Amount shall not exceed the Total Revolving Credit Commitment; and
provided further that, after the Issuing Bank shall have received
notice in writing of the occurrence of an Event of Default and until it
has received written notice of the cure or waiver of such Event of
Default, the Issuing Bank shall not be obliged to issue any such Letter
of Credit unless the Majority Lenders shall have consented to such
issuance in writing.
5.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Issuing Bank.
In the event that any provision of any Letter of Credit Application
shall be inconsistent with any provision of this Credit Agreement, then
the provisions of this Credit Agreement shall, to the extent of any
such inconsistency, govern.
5.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit
issued, extended or renewed hereunder shall, among other things, (i)
provide for the payment of sight drafts for honor thereunder when
presented in accordance with the terms thereof and when accompanied by
the documents described therein, and (ii) have an expiry date no later
than the date which is thirty (30) days (or, if the Letter of Credit is
confirmed by a confirmer or otherwise provides for one or more
nominated persons, sixty (60) days) prior to the Revolving Credit Loan
Maturity Date. Each Letter of Credit so issued, extended or renewed
shall be subject to the Uniform Customs.
5.1.4. REIMBURSEMENT OBLIGATIONS OF LENDERS. Each Lender
severally agrees that it shall be absolutely liable, without regard to
the occurrence of any Default or Event of Default or any condition
precedent other than that set forth in the proviso to this Section
5.1.4, to the extent of such Lender's Revolving Credit Commitment
Percentage, to reimburse the Issuing Bank or the Agent, as the case may
be, on demand for the amount of each draft paid by the Issuing Bank or
the Agent under each Letter of Credit to the extent that such amount is
not reimbursed by TransTechnology pursuant to Section 5.2 (such
agreement for a Lender being called herein the "Letter of Credit
Participation" of such Lender) provided, however, that to the extent
that any Letter of Credit shall have been issued by the Issuing Bank
during the continuance of an Event of Default of which the Issuing Bank
had prior written notice, then the Lenders shall only be liable to
reimburse the Issuing Bank or the Agent, as applicable, in accordance
with this Section 5.1.4 with respect to any draft under such Letter of
Credit paid by the Issuing Bank or the
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Agent and not reimbursed by TransTechnology if the issuance of such
Letter of Credit shall have been approved by the Majority Lenders
pursuant to and in accordance with Section 5.1.1 above.
5.1.5. PARTICIPATIONS OF LENDERS. Each such payment made by a
Lender shall be treated as the purchase by such Lender of a
participating interest in TransTechnology's Reimbursement Obligation
under Section 5.2 in an amount equal to such payment. Each Lender shall
share in accordance with its participating interest in any interest
which accrues pursuant to Section 5.2.
5.2. REIMBURSEMENT OBLIGATION OF TRANSTECHNOLOGY.
In order to induce the Issuing Bank to issue, extend and renew each
Letter of Credit and the Lenders to participate therein, TransTechnology hereby
agrees to reimburse or pay to the Agent, for the account of the Issuing Bank or
(as the case may be), the Agent or the Lenders, with respect to each Letter of
Credit issued, extended or renewed by the Issuing Bank hereunder,
(a) except as otherwise expressly provided in Section 5.2(b)
and (c), on each date that any draft presented under such Letter of
Credit is honored by the Issuing Bank, or the Issuing Bank otherwise
makes a payment with respect thereto, (i) the amount paid by the
Issuing Bank under or with respect to such Letter of Credit, and (ii)
the amount of any taxes, fees, charges or other costs and expenses
whatsoever incurred by the Issuing Bank, the Agent or any Lender in
connection with any payment made by the Issuing Bank or any Lender
under, or with respect to, such Letter of Credit,
(b) upon the reduction (but not termination) of the Total
Revolving Credit Commitment to an amount less than the Maximum Drawing
Amount, an amount equal to such difference, which amount shall be held
by the Issuing Bank for the benefit of the Lenders, the Agent and the
Issuing Bank as cash collateral for all Reimbursement Obligations, and
(c) upon the termination of the Total Revolving Credit
Commitment, or the acceleration of the Reimbursement Obligations with
respect to all Letters of Credit in accordance with Section 14, an
amount equal to the then Maximum Drawing Amount on all Letters of
Credit, which amount shall be held by the Issuing Bank for the benefit
of the Lenders, the Agent and the Issuing Bank as cash collateral for
all Reimbursement Obligations.
Each such payment shall be made to the Agent at the Agent's Head Office (for the
account of the Issuing Bank or (as the case may be) the Agent or the Lenders) in
immediately available funds. Interest on any and all amounts remaining unpaid by
TransTechnology under this Section 5.2 at any time from the date such amounts
become due and payable (whether as stated in this Section 5.2, by acceleration
or otherwise) until payment in full (whether before or after judgment) shall be
payable to the Agent (for the account of the Issuing Bank or (as the case may
be) the Agent or the Lenders) on
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demand at the rate specified in Section 6.11 for overdue principal on the
Revolving Credit Loans.
5.3. LETTER OF CREDIT PAYMENTS.
If any draft shall be presented or other demand for payment shall be
made under any Letter of Credit, the Issuing Bank shall notify TransTechnology
of the date and amount of the draft presented or demand for payment and of the
date and time when it expects to pay such draft or honor such demand for
payment. If TransTechnology fails to make payment to the Agent as provided in
Section 5.2 on or before the date that such draft is paid or other payment is
made by the Issuing Bank, the Issuing Bank may at any time thereafter notify the
Agent and the Lenders of the amount of any such Unpaid Reimbursement Obligation.
No later than 3:00 p.m. (Boston time) on the Business Day next following the
receipt of such notice, each Lender shall make available to the Issuing Bank, at
its Head Office, in immediately available funds, such Lender's Revolving Credit
Commitment Percentage of such Unpaid Reimbursement Obligation, together with an
amount equal to the product of (i) the average, computed for the period referred
to in clause (iii) below, of the weighted average interest rate paid by the
Issuing Bank for federal funds acquired by the Issuing Bank during each day
included in such period, times (ii) the amount equal to such Lender's Revolving
Credit Commitment Percentage of such Unpaid Reimbursement Obligation, times
(iii) a fraction, the numerator of which is the number of days that elapse from
and including the date the Issuing Bank paid the draft presented for honor or
otherwise made payment to the date on which such Lender's Revolving Credit
Commitment Percentage of such Unpaid Reimbursement Obligation shall become
immediately available to the Issuing Bank, and the denominator of which is 360.
The responsibility of the Issuing Bank to TransTechnology and to the Agent and
the Lenders shall be only to determine that the documents (including each draft)
delivered under each Letter of Credit in connection with such presentment shall
be in conformity in all material respects with such Letter of Credit.
5.4. OBLIGATIONS ABSOLUTE.
TransTechnology's obligations under this Section 5 shall be absolute
and unconditional under any and all circumstances and irrespective of the
occurrence of any Default or Event of Default or any condition precedent
whatsoever or any setoff, counterclaim or defense to payment which
TransTechnology may have or have had against the Issuing Bank, the Agent, any
Lender or any beneficiary of a Letter of Credit. TransTechnology further agrees
with the Issuing Bank, the Agent and the Lenders that the Issuing Bank, the
Agent and the Lenders shall not be responsible for, and TransTechnology's
Reimbursement Obligations under Section 5.2 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even if such documents should in fact prove to be in any or all
respects invalid, fraudulent or forged, or any dispute between or among
TransTechnology, the beneficiary of any Letter of Credit or any financing
institution or other party to which any Letter of Credit may be transferred or
any claims or defenses whatsoever of TransTechnology against the beneficiary of
any Letter of
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Credit or any such transferee. The Issuing Bank, the Agent and the Lenders shall
not be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. TransTechnology agrees that any action
taken or omitted by any of the Issuing Bank, the Agent or any Lender under or in
connection with each Letter of Credit and the related drafts and documents, if
done in good faith, shall be binding upon TransTechnology and shall not result
in any liability on the part of the Issuing Bank, the Agent or any Lender to
TransTechnology.
5.5. RELIANCE BY ISSUING BANK.
To the extent not inconsistent with Section 5.4, the Issuing Bank shall
be entitled to rely, and shall be fully protected in relying upon, any Letter of
Credit, draft, writing, resolution, notice, consent, certificate, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message, statement,
order or other document believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel, independent accountants and other experts selected
by the Issuing Bank. The Issuing Bank shall be fully justified in failing or
refusing to take any action under this Agreement unless it shall first have
received such advice or concurrence of the Majority Lenders as it reasonably
deems appropriate or it shall first be indemnified to its reasonable
satisfaction by the Lenders against any and all liability and expense which may
be incurred by it by reason of taking or continuing to take any such action. The
Issuing Bank shall in all cases be fully protected in acting, or in refraining
from acting, under this Agreement in accordance with a request of the Majority
Lenders, and such request and any action taken or failure to act pursuant
thereto shall be binding upon the Lenders and all future holders of the
Revolving Credit Notes or of a Letter of Credit Participation.
5.6. LETTER OF CREDIT FEE.
TransTechnology shall pay a fee (in each case, a "Letter of Credit
Fee") to the Issuing Bank in respect of each Letter of Credit, calculated as a
percentage per annum of the face amount of such Letter of Credit equal to the
sum of (a) the then Applicable Margin with respect to Eurocurrency Rate Loans,
plus (b) one-quarter of one percent (0.25%), plus the Agent's customary
issuance, amendment, negotiation or document examination fee. Such Letter of
Credit Fees, with the exception of (i) such issuance, amendment, negotiation or
document examination fees and (ii) an amount equal to one-quarter of one percent
(0.25%) of the face amount of the applicable Letter of Credit, which shall be
retained by the Issuing Bank for its own account, shall be for the accounts of
the Lenders in accordance with their respective Revolving Credit Commitment
Percentages. Such Letter of Credit Fees shall be payable quarterly in arrears on
the first day of each calendar quarter with respect to the immediately preceding
calendar quarter or portion thereof, commencing on the first such date following
the date of issuance of a Letter of Credit, as well as (with respect to any
applicable issuance, amendment negotiation or document examination fees) at such
other time or times as such charges are customarily made by the Issuing Bank.
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5.7. RESIGNATION OF ISSUING BANK. The Issuing Bank may resign at any
time by giving sixty (60) days prior written notice thereof to the Lenders and
TransTechnology. Upon any such resignation, the Majority Lenders shall have the
right to appoint a successor Issuing Bank. Unless a Default or Event of Default
shall have occurred and be continuing, such successor Issuing Bank shall be
reasonably acceptable to TransTechnology. If no successor Issuing Bank shall
have been so appointed by the Majority Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Issuing Bank's giving of
notice of resignation, then the retiring Issuing Bank may, on behalf of the
Lenders, appoint a successor Issuing Bank, which shall be a financial
institution having a rating of not less than A or its equivalent by Standard &
Poor's Corporation. Upon the acceptance of any appointment as Issuing Bank
hereunder by a successor Issuing Bank, such successor Issuing Bank shall
thereupon succeed to and become vested with all the rights, powers, privileges,
duties and obligations of the retiring Issuing Bank, and, after arranging for
the replacement of, reissuance of or issuance of back-up Letters of Credit with
respect to all outstanding Letters of Credit in a manner satisfactory to the
Majority Lenders, the retiring Issuing Bank shall be discharged from its duties
and obligations hereunder. After any retiring Issuing Bank's resignation, the
provisions of this Credit Agreement and the other Loan Documents shall continue
in effect for its benefit in respect of any actions taken or omitted to be taken
by it while it was acting as Issuing Bank.
6. CERTAIN GENERAL PROVISIONS.
6.1. CLOSING AND STRUCTURING FEES. The Borrowers (but, in the case of
GmbH, subject to Section 30 of the GmbH Act of Germany) jointly and severally
agree to pay on the Closing Date (a) to the Agent for the pro rata accounts of
the Lenders a closing fee in the amount agreed in the Fee Letter and (b) to the
Arranger, for the Arranger's own account, a structuring fee in the amount of the
structuring fee agreed in the Fee Letter.
6.2. AGENT'S FEE. The Borrowers jointly and severally (but, in the case
of GmbH, subject to Section 30 of the GmbH Act of Germany) agree to pay to the
Agent annually in advance, for the Agent's own account, on each anniversary of
the Closing Date, an Agent's fee in the amount agreed in the Fee Letter.
6.3. PAYMENT PROVISIONS.
6.3.1. CURRENCY OF ACCOUNT. Dollars are the currency of
account and payment for each and every sum at any time due from the
Borrowers hereunder, provided that:
(i) each repayment of a Loan or a part thereof shall
be made in the currency in which such Loan is denominated at
the time of that repayment;
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(ii) each payment in respect of a Letter of Credit
shall, except as otherwise provided herein, be made in the
currency in which such Letter of Credit is denominated;
(iii) each payment of interest shall be made in the
currency in which the sum in respect of which such interest is
payable is denominated;
(iv) each payment in respect of costs and expenses
shall be made in the currency in which the same were incurred;
and
(v) any amount expressed to be payable in a currency
other than Dollars shall be paid in that other currency.
6.3.2. APPLICATION OF INTEREST PAYMENTS. Interest and
commissions payable by the Borrowers shall be paid as follows:
(a) as to interest and commissions due with respect to the
International Facility Loans, to the Fronting Banks, for the account of
the respective Fronting Banks, provided that (i) to the extent that a
Lender has paid to such Fronting Bank any amount in respect of any
Fronted Loan pursuant to Section 6.12, interest or commissions to the
extent as aforesaid on such amount of such Fronted Loan (including,
without limitation, any interest accruing at rates calculated in
accordance with Section 6.11) shall thereafter accrue for the account
of such Lender, and (ii) the Fronting Banks shall pay all amounts of
interest received by them in an amount equal to the Applicable Margin
to the Agent for the account of the Lenders in the proportion of the
Lenders' respective Revolving Credit Commitment Percentages; and
(b) as to interest due with respect to Revolving Credit Loans,
to the Agent for the account of the Lenders in the proportion of the
Lenders' respective Revolving Credit Commitment Percentages.
6.3.3. JUDGMENT CURRENCY. If any sum due from a Borrower under
this Credit Agreement or any order or judgment given or made in
relation hereto has to be converted from the currency (the "first
currency") in which the same is payable hereunder or under such order
or judgment into another currency (the "second currency") for the
purpose of (i) making or filing a claim or proof against such Borrower,
(ii) obtaining an order or judgment in any court or other tribunal or
(iii) enforcing any order or judgment given or made in relation hereto,
such Borrower shall indemnify and hold harmless each of the Persons to
whom such sum is due from and against any loss suffered as a result of
any discrepancy between (A) the rate of exchange used for such purpose
to convert the sum in question from the first currency into the second
currency and (B) the rate or rates of exchange at which such Person may
in the ordinary course of business purchase the first currency with the
second currency upon receipt of a sum paid to it in satisfaction, in
whole or in part, of any such order, judgment, claim or proof.
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6.3.4. TIME OF PAYMENT. On each date on which this Credit
Agreement requires an amount to be paid by any of the Borrowers or any
of the Lenders hereunder, such Borrower or, as the case may be, such
Lender shall make the same available to the Agent, the DM Fronting Bank
or the Sterling Fronting Bank, as the case may be, to such account as
the Agent or such Fronting Bank shall have notified to any of the
Borrowers or to such Lender, as the case may be. Each such payment
which is made for the account of a Person other than the Agent shall be
made in time to enable the Agent to make available such other Person's
portion thereof for value the same day.
6.3.5. PAYMENTS BY AGENT. Where a sum is to be paid hereunder
to the Agent for the account of another Person, the Agent shall not be
obliged to make the same available to that other Person until the Agent
has been able to establish to its satisfaction that it has actually
received such sum, but if the Agent does so and it proves to be the
case that the Agent has not actually received the sum it paid out, then
the Person to whom such sum was so made available shall on request
refund the same to the Agent, together with an amount sufficient to
reimburse the Agent for any amount it may have been required to pay out
by way of interest on moneys borrowed to fund the sum in question
during the period beginning on the due date for payment thereof and
ending on the date on which it receives the same.
6.3.6. NO OFFSET, ETC. All payments by the Borrowers hereunder
and under any of the other Loan Documents shall be made without setoff
or counterclaim and free and clear of and without deduction for any
taxes, levies, imposts, duties, charges, fees, deductions,
withholdings, compulsory loans, restrictions or conditions of any
nature now or hereafter imposed or levied by any jurisdiction or any
political subdivision thereof or taxing or other authority therein
unless any of the Borrowers is compelled by law to make such deduction
or withholding. If any such obligation is imposed upon a Borrower with
respect to any amount payable by it hereunder or under any of the other
Loan Documents, such Borrower will make such deduction or withholding,
will pay the full amount deducted or withheld to the applicable
authority, and will also pay to the Agent, for the account of the
Lenders or (as the case may be), the Issuing Bank, the applicable
Fronting Bank or Banks or the Agent, on the date on which such amount
is due and payable hereunder or under such other Loan Document, such
additional amount as shall be necessary to enable the Lenders, the
Issuing Bank, the applicable Fronting Bank or Banks or the Agent (as
the case may be) to receive the same net amount in the same currency
which the Lenders, the Issuing Bank, the applicable Fronting Bank or
Banks or the Agent would have received on such due date had no such
obligation been imposed upon such Borrower. Each Borrower so affected
will deliver, within thirty (30) days of any such deduction or payment,
to the Agent certificates or other valid vouchers for all taxes or
other charges deducted from or paid with respect to payments made by
such Borrower hereunder or under such other Loan Document.
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6.4. COMPUTATIONS.
All computations of interest on Eurocurrency Rate Loans shall, unless
otherwise expressly provided herein, be based on a 360-day year and paid for the
actual number of days elapsed. All computations of interest on Base Rate Loans,
commitment fees, Letter of Credit Fees or other fees shall, unless otherwise
expressly provided herein, be based on a 365-day year and paid for the actual
number of days elapsed. Except as otherwise provided in the definition of the
term "Interest Period" with respect to Eurocurrency Rate Loans, whenever a
payment hereunder or under any of the other Loan Documents becomes due on a day
that is not a Business Day, the due date for such payment shall be extended to
the next succeeding Business Day, and interest shall accrue during such
extension. The outstanding amount of the Revolving Credit Loans as reflected on
the Revolving Credit Note Records from time to time shall be considered correct
and binding on TransTechnology unless within five (5) Business Days after
receipt of any notice by the Agent or any of the Lenders of such outstanding
amount, the Agent or such Lender shall notify such Borrower to the contrary.
6.5. INABILITY TO DETERMINE EUROCURRENCY RATE.
In the event, prior to the commencement of any Interest Period relating
to any Eurocurrency Rate Loan, (a) the DM Fronting Bank shall determine, with
respect to any DM Facility Loan which is a Eurocurrency Rate Loan, (b) the
Sterling Fronting Bank shall determine with respect to any Sterling Facility
Loan which is Eurocurrency Rate Loan, or (c) the Agent shall determine or be
notified by the Majority Lenders, with respect to any Revolving Credit Loan
which is a Eurocurrency Rate Loan, that adequate and reasonable methods do not
exist for ascertaining the applicable Eurocurrency Rate that would otherwise
determine the rate of interest to be applicable to such Eurocurrency Rate Loan,
the applicable Fronting Bank or the Agent, as the case may be, shall forthwith
give notice of such determination (which shall be conclusive and binding on the
Borrowers and the Lenders) to the applicable Borrower(s) and (in the case of the
Agent) to the applicable Lender(s). In such event (i) any Loan Request or
Conversion Request with respect to Eurocurrency Rate Loans shall be
automatically withdrawn and, to the fullest extent practicable, shall be deemed
a request for Base Rate Loans, (ii) each Eurocurrency Rate Loan will
automatically, on the last day of the then current Interest Period relating
thereto, become a Base Rate Loan, and (iii) the obligations of the applicable
Lender(s) or, as the case may be, Fronting Bank(s) to make Eurocurrency Rate
Loans shall be suspended until the Agent or, as the case may be, the applicable
Fronting Bank(s), or the Majority Lenders determine that the circumstances
giving rise to such suspension no longer exist, whereupon the Agent or, as the
case may be, the Agent upon the instruction of the Majority Lenders or the
applicable Fronting Bank(s), shall so notify the applicable Borrower(s) and (in
the case of the Agent) the applicable Lender(s).
6.6. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Lender or Fronting Bank to
make or
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maintain Eurocurrency Rate Loans, such Lender, if so affected, shall forthwith
give notice of such circumstances to TransTechnology, the Agent and the other
Lenders, and such Fronting Bank, if so affected, shall forthwith give notice of
such circumstances to the Borrowers and the Agent. Thereupon (i) the commitment
of such Lender or Fronting Bank to make Eurocurrency Rate Loans or convert Loans
of another Type to Eurocurrency Rate Loans shall forthwith be suspended, and
(ii) such Lender's or Fronting Bank's Loans then outstanding as Eurocurrency
Rate Loans, if any, shall be converted automatically to Base Rate Loans on the
last day of each Interest Period applicable to such Eurocurrency Rate Loans or
within such earlier period as may be required by law. The Borrowers hereby
jointly and severally agree promptly to pay the Agent for the account of such
Lender or Fronting Bank upon demand by such Lender or Fronting Bank, any
additional amounts necessary to compensate such Lender or Fronting Bank for any
costs incurred by such Lender or Fronting Bank in making any conversion in
accordance with this Section 6.6, including any interest or fees payable by such
Lender or Fronting Bank to lenders of funds obtained by it in order to make or
maintain its Eurocurrency Rate Loans hereunder.
6.7. ADDITIONAL COSTS, ETC. If any present or future applicable law,
which expression, as used herein, includes statutes, rules and regulations
thereunder and interpretations thereof by any competent court or by any
governmental or other regulatory body or official charged with the
administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Lender or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Lender or Fronting Bank, the Issuing Bank, or
the Agent to any tax, levy, impost, duty, charge, fee, deduction or
withholding of any nature with respect to this Credit Agreement, the
other Loan Documents, any Letters of Credit, such Lender's Commitment,
the Loans or any payment of interest or fees payable with respect to
any Loans (other than taxes based upon or measured by the income or
profits of such Lender, Issuing Bank, Fronting Bank or Agent, or bank
franchise taxes), but including any tax or withholding applicable to
any payment to be made by a Fronting Bank to the Agent pursuant to
Section 6.3.2(a), or by any Lender to the Agent for the account of a
Fronting Bank pursuant to Section 6.12.2, or
(b) materially change the basis of taxation (except for
changes in taxes on income or profits or bank franchise taxes) of
payments to any Lender of the principal of or the interest on any Loans
or any other amounts payable to any Lender or the Agent under this
Credit Agreement or any of the other Loan Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement)
any special deposit, reserve, assessment, liquidity, capital adequacy
or other similar requirements (whether or not having the force of law)
against assets held by,
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or deposits in or for the account of, or loans by, or letters of credit
issued by, or commitments of any office of any Lender (including any
Fronting Bank or the Issuing Bank), and including, without limitation,
any MLA costs with respect to Sterling Facility Loans or
indemnification obligations of any Lender with respect thereto, or
(d) impose on any Lender (including any Fronting Bank or the
Issuing Bank) or the Agent any other conditions or requirements with
respect to this Credit Agreement, the other Loan Documents, any Letters
of Credit, the Loans, such Lender's Commitment, or any class of loans,
letters of credit or commitments of which any of the Loans or such
Lender's Commitment forms a part, and the result of any of the
foregoing is
(i) to increase the cost to any such Lender of
making, funding, issuing, renewing, extending or maintaining
any of the Loans or such Lender's Commitment or any Letter of
Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such
Lender or the Agent hereunder on account of such Lender's
Commitment, any Letter of Credit or any of the Loans, or
(iii) to require such Lender or the Agent to make any
payment or to forego any interest or Reimbursement Obligation
or other sum payable hereunder, the amount of which payment or
foregone interest or Reimbursement Obligation or other sum is
calculated by reference to the gross amount of any sum
receivable or deemed received by such Lender or the Agent from
the Borrowers hereunder,
then, and in each such case, within fifteen (15) days after demand made by such
Lender or Fronting Bank or (as the case may be) the Agent or the Issuing Bank at
any time and from time to time and as often as the occasion therefor may arise,
the Borrowers will (but, in the case of GmbH, subject to Section 30 of the GmbH
Act of Germany) jointly and severally pay to such Lender, Fronting Bank, Agent
or Issuing Bank such additional amounts as will be sufficient to compensate such
Lender, Fronting Bank, Agent or Issuing Bank, as the case may be, for such
additional cost, reduction, payment or foregone interest or Reimbursement
Obligation or other sum.
6.8. CAPITAL ADEQUACY. If after the date hereof any Lender (including
any Fronting Bank and the Issuing Bank) or the Agent determines that (i) the
adoption of or change in any law, governmental rule, regulation, policy,
guideline or directive (whether or not having the force of law) regarding
capital requirements for Lenders or Lender holding companies or any change in
the interpretation or application thereof by a court or governmental authority
with appropriate jurisdiction, or (ii) compliance by such Lender or the Agent or
any corporation controlling such Lender, or the Agent with any law, governmental
rule, regulation, policy, guideline or directive (whether or not having the
force of law) of any such entity regarding capital adequacy, has the effect of
reducing the return on such Lender's, or the
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Agent's commitment with respect to any Loans or Letters of Credit to a level
below that which such Lender or the Agent could have achieved but for such
adoption, change or compliance (taking into consideration such Lender's or the
Agent's then existing policies with respect to capital adequacy and assuming
full utilization of such entity's capital) by any amount deemed by such Lender
or (as the case may be) the Agent to be material, then such Lender or the Agent
may notify the Borrowers of such fact. To the extent that the amount of such
reduction in the return on capital is not reflected in the Base Rate,
TransTechnology agrees to pay such Lender or (as the case may be) the Agent for
the amount of such reduction in the return on capital as and when such reduction
is determined upon presentation by such Lender or (as the case may be) the Agent
of a certificate in accordance with Section 6.9 hereof. Each Lender and the
Agent shall allocate such cost increases among its customers in good faith and
on an equitable basis.
6.9. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Sections 6.7 or 6.8 and a brief explanation of such
amounts which are due, submitted by any Lender (including any Fronting Bank and
the Issuing Bank) or the Agent to the Borrowers, shall be conclusive, absent
manifest error, that such amounts are due and owing.
6.10. INDEMNITY. The Borrowers jointly and severally (but, in the case
of GmbH, subject to Section 30 of the GmbH Act of Germany) agree to indemnify
each Lender and to hold each Lender harmless from and against any loss, cost or
expense (including loss of anticipated profits) that such Lender may sustain or
incur as a consequence of (i) default by any of the Borrowers in payment of the
principal amount of or any interest on any Eurocurrency Rate Loans as and when
due and payable, including any such loss or expense arising from interest or
fees payable by such Lender to lenders of funds obtained by it in order to
maintain its Eurocurrency Rate Loans, (ii) default by any of the Borrowers in
making a borrowing or conversion after such Borrower has given (or is deemed to
have given) a Loan Request, notice or a Conversion Request relating thereto, or
(iii) the making of any payment of a Eurocurrency Rate Loan or the making of any
conversion of any such Loan to a Base Rate Loan on a day that is not the last
day of the applicable Interest Period with respect thereto, including interest
or fees payable by such Lender to lenders of funds obtained by it in order to
maintain any such Loans.
6.11. INTEREST AFTER DEFAULT.
6.11.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other
overdue amounts payable hereunder or under any of the other Loan
Documents shall bear interest compounded monthly and payable on demand
at a rate per annum equal to the sum of (i) two percent (2%) per annum,
plus (ii) the Applicable Margin with respect to Eurocurrency Rate Loans
plus (iii) the Base Rate, until such amount shall be paid in full
(after as well as before judgment).
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6.11.2. AMOUNTS NOT OVERDUE. During the continuance of a
Default or an Event of Default, the principal of the Revolving Credit
Loans and the International Facility Loans not overdue shall, until
such Default or Event of Default has been cured or remedied or such
Default or Event of Default has been waived by the Majority Lenders
pursuant to Section 27, bear interest at a rate per annum equal to the
greater of (i) two percent (2%) above the rate of interest otherwise
applicable to such Loans pursuant to Section 2.5 or Section 3.5, and
(ii) the rate of interest applicable to overdue principal pursuant to
Section 6.11.1.
6.12. FRONTING BANK PROVISIONS.
6.12.1. FRONTING FEE. The Borrowers jointly and severally
agree to pay to the Fronting Banks for the account of the Fronting
Banks a fronting fee calculated at the rate of one-quarter of one
percent (1/4%) per annum on the average principal amount of Fronted
Loans outstanding (including amounts requested) during each calendar
quarter or portion thereof from the Closing Date to the Revolving
Credit Loan Maturity Date. The fronting fee shall be payable quarterly
in arrears on the first day of each calendar quarter with respect to
the immediately preceding calendar quarter, commencing on the first
such date following the date hereof, with a final payment on the
Revolving Credit Loan Maturity Date or any earlier date on which a
Fronting Bank's commitment to make Fronted Loans shall terminate.
6.12.2. INDEMNITIES. Each of the Lenders severally undertakes
to keep the Fronting Banks indemnified as follows:
(a) Each Lender irrevocably and unconditionally undertakes to
pay to the Agent for the account of each Fronting Bank, on demand made
by such Fronting Bank through the Agent:
(i) such Lender's Revolving Credit Commitment
Percentage of each amount which is expressed to be payable by
any of the Borrowers to or for the account of such Fronting
Bank by way of the payment, repayment or prepayment of any
International Facility Loan and which the applicable Borrower
fails to pay together with interest which has accrued with
respect thereto, and
(ii) such additional amount as shall be necessary to
reimburse such Fronting Bank for its cost of funding the
amount payable by such Lender as mentioned in sub-clause (i)
above during the period beginning on the date the amount was
due from the applicable Borrower and ending on the date demand
is made on such Lender for payment of the same,
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and agrees that neither the Fronting Banks nor the Agent shall be
obliged to make any demand on or take any proceedings against any of
the Borrowers or any other person before making demand on such Lender
hereunder.
(b) Each Lender irrevocably and unconditionally undertakes to
pay to the Agent for the account of each Fronting Bank on demand made
by such Fronting Bank through the Agent at any time after an Event of
Default has occurred and is continuing and has not been waived, its
Revolving Credit Commitment Percentage of the Dollar Equivalent on the
date of such payment of any outstanding International Facility Loan
made by such Fronting Bank, and any such payment shall be in
satisfaction pro tanto of the undertakings of such Lender contained in
clause (a) above.
(c) If a Lender fails to make payment on the due date therefor
of any amount due from it for the account of a Fronting Bank pursuant
to clauses (a) or (b) above (a "relevant amount") then (i) such Lender
shall be deemed to be Delinquent Lender pursuant to Section 16.5.3, and
(ii) until such Fronting Bank has received payment of the relevant
amount in full (and without prejudice to any other rights or remedies
of the Agent or such Fronting Bank in respect of such failure) such
Fronting Bank shall be entitled to receive any interest which such
Delinquent Lender would otherwise have been entitled to receive in
respect of the Loan in respect of which the relevant amount is payable
and (iii) such Delinquent Lender shall have no right to vote as a
Lender hereunder or under any of the other Loan Documents, and, for so
long as such Lender remains a Delinquent Lender under this
Section 6.12.2, the determination of the Majority Lenders shall for all
purposes of this Credit Agreement and the other Loan Documents be made
without regard to the interest of such Delinquent Lender in the Loans
to the extent of such participation.
(d) The Borrowers jointly and severally, irrevocably and
unconditionally (but, in the case of GmbH, subject to Section 30 of the
GmbH Act of Germany), undertake (i) to reimburse to each Lender any
amount paid by such Lender pursuant to this Section 6.12.2, and such
amount shall be immediately due from the Borrowers to such Lender on
the day such amount is paid by such Lender to the Agent, and shall
accrue interest from such date until the date of payment in full of
such amount (including all accrued and unpaid interest thereon) at the
rate of interest applicable to overdue principal pursuant to
Section 6.11.1, and (ii) to indemnify and hold each Lender harmless
against all actions, proceedings, liabilities, claims, demands, costs
and expenses of whatsoever nature and howsoever occurring which such
Lender may properly incur, suffer or sustain by reason of its payment
of such amount, including without limitation any losses (in Dollars)
arising from fluctuations in currency rates between the date of any
payment to the Agent by such Lender pursuant to clauses (a) or (b)
above, and the date of such Lender's receipt of payment pursuant to
this clause (d).
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6.12.3. RESIGNATION OF FRONTING BANK. The DM Fronting Bank or
the Sterling Fronting Bank may resign at any time by giving sixty (60)
days prior written notice thereof to the Lenders and TransTechnology.
Upon any such resignation, the Majority Lenders shall have the right to
appoint a successor DM Fronting Bank or Sterling Fronting Bank, as the
case may be. Unless a Default or Event of Default shall have occurred
and be continuing, such successor Fronting Bank shall be reasonably
acceptable to TransTechnology. If no successor Fronting Bank shall have
been so appointed by the Majority Lenders and shall have accepted such
appointment within thirty (30) days after the retiring Fronting Bank's
giving of notice of resignation, then the retiring Fronting Bank may,
on behalf of the Banks, appoint a successor Fronting Bank, which shall
be a financial institution having a rating of not less than A or its
equivalent by Standard & Poor's Ratings Group, and having either the
ability to fund DM Loans from a lending office located in Germany, if
the retiring Fronting Bank is the DM Fronting Bank, or the ability to
fund Sterling Loans from a lending office located in England, if the
retiring Fronting Bank is the Sterling Fronting Bank. Upon the
acceptance of any appointment as a Fronting Bank hereunder by a
successor Fronting Bank, such successor Fronting Bank shall thereupon
succeed to and become vested with all the rights, powers, privileges,
duties and obligations of the retiring Fronting Bank, and the retiring
Fronting Bank shall be discharged from its duties and obligations
hereunder. After any retiring Fronting Bank's resignation, the
provisions of this Credit Agreement and the other Loan Documents shall
continue in effect for its benefit in respect of any actions taken or
omitted to be taken by it while it was acting as a Fronting Bank.
6.12.4. NOTICE TO LENDERS. Not less than once each month the
Agent will notify each of the Lenders as to such Lender's balance of
all Fronted Loans outstanding at such time.
6.13. LIMITS ON NUMBER OF SEPARATE EUROCURRENCY RATE LOANS.
No more than ten (10) separate Eurocurrency Rate Loans (whether
outstanding with respect to the Revolving Credit Loans or International Facility
Loans) may be outstanding under this Credit Agreement at any one time.
Notwithstanding the foregoing, during the period commencing on the Closing Date
and ending on the date which is the earlier of (i) sixty (60) days after the
Closing Date and (ii) the date on which the Agent notifies TransTechnology in
writing that syndication of the Loans hereunder has been completed, there shall
be no more than three (3) Eurocurrency Rate Loans in effect, the Interest
Periods of which shall be no longer than one (1) month, and each of which shall
terminate no later than the sixtieth (60th) day after the Closing Date.
7. COLLATERAL SECURITY AND GUARANTIES.
7.1. SECURITY OF BORROWERS. All of the Obligations shall be secured by
a perfected first priority security interest (subject only to Permitted Liens
entitled to
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priority under applicable law) in all of the assets of TransTechnology, whether
now owned or hereafter acquired, pursuant to the terms of the Security Documents
to which TransTechnology is a party. The Obligations of GmbH shall be secured by
a security interest (subject only to Permitted Liens entitled to priority under
applicable law) in all of the assets of GmbH and SO OHG, whether now owned or
hereafter acquired, pursuant to the terms of the German Security Documents. The
Obligations of Limited shall be secured by a first priority fixed and floating
charge over all of the assets of Limited, whether now owned or hereafter
acquired, pursuant to the terms of the Debenture.
7.2. GUARANTIES AND SECURITY OF SUBSIDIARIES. The Obligations shall
also be guaranteed pursuant to the terms of the Guaranties. The obligations of
each of the Guarantors shall be in turn secured by a perfected first priority
security interest (subject only to Permitted Liens entitled to priority under
applicable law) in all of the assets of each such Guarantor, whether now owned
or hereafter acquired, pursuant to the terms of the Security Documents to which
each such Guarantor is a party.
7.3. PLEDGES OF STOCK. Notwithstanding anything to the contrary
contained herein or in any of the other Loan Documents, including without
limitation the German Pledge Agreement and the Charge Over Shares from TTSO,
Inc., to the extent that any pledge, lien, security interest, charge, mortgage
or other encumbrance over any shares of a Foreign Subsidiary granted by
TransTechnology or any of its Domestic Subsidiaries extends or purports to
extend to any shares in excess of 65% of the aggregate issued and outstanding
shares of capital stock of such Foreign Subsidiary, neither the Agent nor any of
the Lenders shall exercise any rights it may have or purport to have with
respect to such excess shares. Notwithstanding anything to the contrary
contained herein or in any of the other Loan Documents, in the event that
TransTechnology or any of the Domestic Subsidiaries delivers to the Agent or, as
the case may be, a Fronting Bank acting on behalf of the Agent, certificates or
other instruments representing greater than 65% of the aggregate issued and
outstanding shares of capital stock of such Foreign Subsidiary, the shares in
excess of 65% of such Foreign Subsidiary's capital stock shall not be subject to
any pledge, lien, security interest, charge, mortgage or other encumbrance under
this Agreement or any of the other Loan Documents but shall be held in the
custody of the Agent or such Fronting Bank for and on behalf of TransTechnology
or such Domestic Subsidiary, as applicable, until such time as TransTechnology
or such Domestic Subsidiary shall have delivered to the Agent certificates or
other instruments representing 65% of the aggregate issued and outstanding
shares of capital stock of such Foreign Subsidiary, at which time the Agent or
such Fronting Bank shall release the original certificates or other instruments
delivered to it to TransTechnology or the applicable Domestic Subsidiary.
7.4. GUARANTEES AND PLEDGES OF ASSETS OF FOREIGN SUBSIDIARIES.
Notwithstanding anything to the contrary contained herein or in any of the other
Loan Documents, no guarantee entered into by any Foreign Subsidiary, including
without limitation either of the English Guarantees, shall be
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construed in any way as a guarantee of, and no pledge, lien, security interest,
charge, mortgage or other encumbrance over any assets of a Foreign Subsidiary
shall be construed in any way to secure, any obligation of TransTechnology or
any of its Domestic Subsidiaries.
8. REPRESENTATIONS AND WARRANTIES.
The Borrowers jointly and severally represent and warrant to the
Lenders and the Agent, at the Closing Date and on each Acquisition Closing Date
after giving effect to the Approved Acquisition occurring thereon, as follows:
8.1. CORPORATE AUTHORITY.
8.1.1. INCORPORATION; GOOD STANDING. Each of the Borrowers and
its respective Subsidiaries (i) is a corporation duly organized,
validly existing and in good standing under the laws of its place of
incorporation, (ii) has all requisite corporate power to own its
property and conduct its business as now conducted and as presently
contemplated, and (iii) is in good standing as a foreign corporation
and is duly authorized to do business in each jurisdiction where such
qualification is necessary except where a failure to be so qualified
would not have a materially adverse effect on the business, assets or
financial condition of such Borrower or Subsidiary.
8.1.2. AUTHORIZATION. The execution, delivery and performance
of this Credit Agreement and the other Loan Documents to which the
Borrowers or any of their Subsidiaries are or are to become a party and
the transactions contemplated hereby and thereby (i) are within the
corporate authority of such Person, (ii) have been duly authorized by
all necessary corporate proceedings, (iii) do not conflict with or
result in any breach or contravention of any provision of law, statute,
rule or regulation to which any of the Borrowers or their Subsidiaries,
or any of the assets of any of the Borrowers or their Subsidiaries, are
subject or any judgment, order, writ, injunction, license or permit
applicable to any of the Borrowers or their Subsidiaries and (iv) do
not conflict with any provision of the corporate charter, bylaws or
memorandum and articles of association of, or any agreement or other
instrument binding upon, any of the Borrowers or their Subsidiaries.
8.1.3. ENFORCEABILITY. The execution and delivery of this
Credit Agreement and the other Loan Documents to which the Borrowers or
any of their Subsidiaries are or are to become a party will result in
valid and legally binding obligations of such Person enforceable
against it in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or
affecting generally the enforcement of creditors' rights and except to
the extent that availability of the remedy of specific performance or
injunctive relief is subject to the discretion of the court before
which any proceeding therefor may be brought.
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8.2. GOVERNMENTAL APPROVALS.
The execution, delivery and performance by each of the Borrowers and
their respective Subsidiaries of this Credit Agreement, the other Loan Documents
and the Acquisition Documents to which any of the Borrowers or any of their
Subsidiaries are or are to become a party and the transactions contemplated
hereby and thereby do not require the approval or consent of, or filing with,
any governmental agency or authority other than those already obtained.
8.3. TITLE TO PROPERTIES; LEASES.
Except as indicated on Schedule 8.3 hereto, (a) TransTechnology and its
respective Subsidiaries own all of the assets reflected in the consolidated
balance sheet of TransTechnology and its Subsidiaries as at the Balance Sheet
Date or acquired since that date (except property and assets sold or otherwise
disposed of in the ordinary course of business since that date) subject to no
rights of others, including any mortgages, leases, conditional sales agreements,
title retention agreements, liens or other encumbrances except Permitted Liens,
and (b) all of TransTechnology's and its respective Subsidiaries' assets are
reflected in the consolidated balance sheet as at the Balance Sheet Date
described in Section 8.4.1.
8.4. FINANCIAL STATEMENTS AND PROJECTIONS.
8.4.1. FINANCIAL STATEMENTS. There has been furnished to each
of the Lenders a consolidated balance sheet of TransTechnology and its
Subsidiaries as at the Balance Sheet Date, and a consolidated statement
of income of TransTechnology and its Subsidiaries for the fiscal year
then ended, certified by Deloitte & Touche LLP. Such balance sheet and
statement of income have been prepared in accordance with generally
accepted accounting principles and fairly present the financial
condition of TransTechnology as at the close of business on the date
thereof and the results of operations for the fiscal year then ended.
There are no contingent liabilities of TransTechnology or any of its
Subsidiaries as of such date involving material amounts, known to the
officers of TransTechnology, which were not disclosed in such balance
sheet and the notes related thereto.
8.4.2. PROJECTIONS. There has been furnished to each of the
Lenders projections (dated July 1, 1998) of the annual operating
budgets of TransTechnology and its Subsidiaries on a consolidated
basis, balance sheets and cash flow statements for the 1999 to 2003
fiscal years (the "Projections"), which fairly disclose all assumptions
made with respect to general economic, financial and market conditions
used in their formulation. To the knowledge of TransTechnology, no
facts exist that (individually or in the aggregate) would result in any
material change in any of the Projections. The Projections are based
upon reasonable estimates and assumptions, have been prepared on the
basis of the assumptions stated therein and reflect the reasonable
estimates of TransTechnology of the results of operations and other
information projected therein.
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8.5. NO MATERIAL CHANGES, ETC.
(a) Since the Balance Sheet Date there has occurred no materially
adverse change in the financial condition or business of TransTechnology or any
of its Subsidiaries or any material assets of TransTechnology or any of its
Subsidiaries as shown on or reflected in the consolidated balance sheet of
TransTechnology and its Subsidiaries as at the Balance Sheet Date, or the
consolidated statement of income for the fiscal year then ended, other than
changes in the ordinary course of business that have not had any materially
adverse effect either individually or in the aggregate on the business or
financial condition of TransTechnology or any of its Subsidiaries or any
material assets of TransTechnology or any of its Subsidiaries. Since the Balance
Sheet Date, TransTechnology has not made any Distribution except for its regular
quarterly dividend of $407,683 paid on June 1, 1998.
(b) Each of the Borrowers and each of their Subsidiaries (before and
after giving effect to the transactions contemplated by this Credit Agreement
and the other Loan Documents) (i) is solvent, (ii) has assets having a fair
value in excess of its liabilities, (iii) has assets having a fair value in
excess of the amount required to pay its liabilities on existing debts as such
debts become absolute and matured, and (iv) has, and expects to continue to
have, access to adequate capital for the conduct of its business and the ability
to pay its debts from time to time incurred in connection with the operation of
its business as such debts mature.
8.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Borrowers and
each of their Subsidiaries possesses all franchises, patents, copyrights,
trademarks, trade names, licenses and permits, and rights in respect of the
foregoing, adequate for the conduct of its business substantially as now
conducted without known conflict with any rights of others.
8.7. LITIGATION. Except as set forth in Schedule 8.7 hereto, there are
no actions, suits, proceedings or investigations of any kind pending or
threatened against any of the Borrowers or their Subsidiaries before any court,
tribunal or administrative agency or board that, if adversely determined, might,
either in any case or in the aggregate, materially adversely affect the
properties, assets, financial condition or business of any of the Borrowers or
their Subsidiaries or materially impair the right of any of the Borrowers or
their Subsidiaries to carry on business substantially as now conducted by them,
or result in any substantial liability not adequately covered by insurance, or
for which adequate reserves are not maintained on the consolidated balance sheet
of the Borrowers and their Subsidiaries, or which question the validity of this
Credit Agreement or any of the other Loan Documents, or any action taken or to
be taken pursuant hereto or thereto.
8.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Borrowers nor
any of their Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected in the future to have a materially adverse effect on the business,
assets or financial condition of any of the Borrowers or their Subsidiaries.
None of the Borrowers nor any of their Subsidiaries is a party to any contract
or agreement that is in default or
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has or is expected, in the judgment of the Borrowers' officers, to have any
materially adverse effect on the business of any of the Borrowers or their
Subsidiaries.
8.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the
Borrowers nor any of their Subsidiaries is in violation of any provision of its
charter documents, bylaws, or any agreement or instrument to which it may be
subject or by which it or any of its properties may be bound or any decree,
order, judgment, act, statute, license, rule, regulation or other law, in any of
the foregoing cases in a manner that could result in the imposition of
substantial penalties or materially and adversely affect the financial
condition, properties or business of any of the Borrowers or their Subsidiaries.
8.10. TAX STATUS. Except as disclosed on Schedule 8.10 hereto, each of
the Borrowers and its Subsidiaries (i) has made or filed all federal and state
income and all other tax returns, reports and declarations required by any
jurisdiction to which any of them is subject, (ii) has paid all taxes and other
governmental assessments and charges shown or determined to be due on such
returns, reports and declarations, except those being contested in good faith
and by appropriate proceedings and (iii) has set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no
unpaid taxes in any material amount claimed to be due by the taxing authority of
any jurisdiction, and the officers of the Borrowers know of no basis for any
such claim.
8.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
8.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the
Borrowers nor any of their Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company", as
such terms are defined in the Public Utility Holding Company Act of 1935; nor
are any of the Borrowers or their Subsidiaries an "investment company", or an
"affiliated company" or a "principal underwriter" of an "investment company", as
such terms are defined in the Investment Company Act of 1940.
8.13. ABSENCE OF FINANCING STATEMENTS, ETC. There is no financing
statement, security agreement, chattel mortgage, real estate mortgage, lease or
other document filed or recorded with any filing records, registry or other
public office, or otherwise, that purports to cover, affect or give notice of
any present or possible future lien on, or security interest in, any assets or
property of any of the Borrowers or their Subsidiaries or any rights relating
thereto, except with respect to Permitted Liens.
8.14. PERFECTION OF SECURITY INTEREST. All filings, assignments,
pledges and deposits of documents or instruments have been made and all other
actions have been taken that are necessary or advisable, under applicable law,
to establish and perfect the Agent's security interests in and charges over the
Collateral. The Collateral and the Agent's rights with respect to the Collateral
are not subject to
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any material setoff, claims, withholdings or other defenses. The Borrowers or
their Subsidiaries, as specified in the Security Documents, are the owners of
the Collateral free from any lien, security interest, encumbrance and any other
claim or demand, except for Permitted Liens.
8.15. CERTAIN TRANSACTIONS. Except for arm's length transactions
pursuant to which any of the Borrowers or their Subsidiaries or any officer,
director or employee of such Borrower or Subsidiary makes payments in the
ordinary course of business upon terms no less favorable than such Borrowers,
Subsidiaries, officers, directors or employees could obtain from third parties,
none of the officers, directors, or employees of any of the Borrowers or their
Subsidiaries is presently a party to any transaction with any of the Borrowers
or their Subsidiaries (other than for services as employees, officers and
directors), including any contract, agreement or other arrangement providing for
the furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director or such employee or, to the knowledge of any Borrower, any corporation,
partnership, trust or other entity in which any officer, director, or any such
employee has a substantial interest or is an officer, director, trustee or
partner.
8.16. EMPLOYEE BENEFIT PLANS.
8.16.1. IN GENERAL. Each Employee Benefit Plan has been
maintained and operated in compliance in all material respects with the
provisions of ERISA and, to the extent applicable, the Code, including
but not limited to the provisions thereunder respecting prohibited
transactions. TransTechnology has heretofore delivered to the Agent the
most recently completed annual report, Form 5500, with all required
attachments, and actuarial statement required to be submitted under
Section 103(d) of ERISA, with respect to each Guaranteed Pension Plan.
8.16.2. TERMINABILITY OF WELFARE PLANS. Under each Employee
Benefit Plan which is an employee welfare benefit plan within the
meaning of Section 3(1) or Section 3(2)(B) of ERISA, no benefits are
due unless the event giving rise to the benefit entitlement occurs
prior to plan termination (except as required by Title I, Part 6 of
ERISA). TransTechnology or an ERISA Affiliate, as appropriate, may
terminate each such Plan at any time (or at any time subsequent to the
expiration of any applicable bargaining agreement) in the discretion of
TransTechnology or such ERISA Affiliate without liability to any
Person.
8.16.3. GUARANTEED PENSION PLANS. Each contribution required
to be made to a Guaranteed Pension Plan, whether required to be made to
avoid the incurrence of an accumulated funding deficiency, the notice
or lien provisions of Section 302(f) of ERISA, or otherwise, has been
timely made. No waiver of an accumulated funding deficiency or
extension of amortization periods has been received with respect to any
Guaranteed Pension Plan. No liability to the PBGC (other than required
insurance premiums, all of which
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have been paid) has been incurred by TransTechnology or any ERISA
Affiliate with respect to any Guaranteed Pension Plan and there has not
been any ERISA Reportable Event, or any other event or condition which
presents a material risk of termination of any Guaranteed Pension Plan
by the PBGC. Based on the latest valuation of each Guaranteed Pension
Plan (which in each case occurred within twelve months of the date of
this representation), and on the actuarial methods and assumptions
employed for that valuation, the aggregate benefit liabilities of all
such Guaranteed Pension Plans within the meaning of Section 4001 of
ERISA did not exceed the aggregate value of the assets of all such
Guaranteed Pension Plans, disregarding for this purpose the benefit
liabilities and assets of any Guaranteed Pension Plan with assets in
excess of benefit liabilities.
8.16.4. MULTIEMPLOYER PLANS. Other than (a) the Electronics
Local 431 Pension Fund relating to employees of Xxxxxx Inc., a
Subsidiary of TransTechnology, and (b) the Western Pennsylvania
Teamster and Employers Pension Fund relating to employees of
TransTechnology's Breeze-Industrial division, neither TransTechnology
nor any ERISA Affiliate is a member of any Multiemployer Plan. Neither
TransTechnology nor any ERISA Affiliate has incurred any material
liability (including secondary liability) to any Multiemployer Plan as
a result of a complete or partial withdrawal from such Multiemployer
Plan under Section 4201 of ERISA or as a result of a sale of assets
described in Section 4204 of ERISA. Neither TransTechnology nor any
ERISA Affiliate has been notified that any Multiemployer Plan is in
reorganization or insolvent under and within the meaning of Section
4241 or Section 4245 of ERISA or that any Multiemployer Plan intends to
terminate or has been terminated under Section 4041A of ERISA.
8.16.5. COMPLIANCE WITH EMPLOYMENT BENEFIT LAWS. Except as set
forth in Schedule 8.16.5 hereto, none of the Borrowers nor any of their
Subsidiaries is in violation of any material provision of any
applicable pension, retirement funding or employee benefit legislation
in any jurisdiction.
8.17. USE OF PROCEEDS. The proceeds of the Loans shall be used to
refinance certain Indebtedness of the Borrowers under the Original Credit
Agreement, to finance Approved Acquisitions and for working capital and general
corporate purposes of the Borrowers. TransTechnology will obtain Letters of
Credit solely for working capital and general corporate purposes. No portion of
any Loan is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of purchasing or carrying any "margin security" or
"margin stock" as such terms are used in Regulations U and X of the Board of
Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and 224. No portion
of the proceeds of any Loans is to be used, and no portion of any Letter of
Credit is to be obtained, for the purpose of (a) knowingly purchasing, or
providing credit support for the purchase of, Ineligible Securities from a
Section 20 Subsidiary during any period in which such Section 20 Subsidiary
makes a market in such Ineligible Securities, (b) knowingly purchasing, or
providing credit support for the purchase of, during the underwriting or
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placement period, any Ineligible Securities being underwritten or privately
placed by a Section 20 Subsidiary, or (c) making, or providing credit support
for the making of, payments of principal or interest on Ineligible Securities
underwritten or privately placed by a Section 20 Subsidiary and issued by or for
the benefit of the Borrowers or any Subsidiary or other Affiliate of any of the
Borrowers.
8.18. ENVIRONMENTAL COMPLIANCE. Each of the Borrowers and their
Subsidiaries has taken all necessary steps to investigate the past and present
condition and usage of the Real Estate and the operations conducted thereon and,
based upon such diligent investigation, has determined that, except as set forth
on Schedule 8.18 attached hereto:
(a) none of the Borrowers, their Subsidiaries or any operator
of the Real Estate or any operations thereon is in violation, or
alleged violation, of any judgment, decree, order, law, license, rule
or regulation pertaining to environmental matters, including without
limitation, those arising under the Resource Conservation and Recovery
Act ("RCRA"), the Comprehensive Environmental Response, Compensation
and Liability Act of 1980 as amended ("CERCLA"), the Superfund
Amendments and Reauthorization Act of 1986 ("XXXX"), the Federal Clean
Water Act, the Federal Clean Air Act, the Toxic Substances Control Act,
or any European Union, national, federal, state or local statute,
regulation, ordinance, order or decree relating to health, safety or
the environment (hereinafter "Environmental Laws"), which violation
would have a material adverse effect or the business, assets or
financial condition of any of the Borrowers or their Subsidiaries or
the consummation of the transactions referred to in this Agreement;
(b) the Borrowers and their Subsidiaries have conducted all
business operations on the Real Estate and continue to operate and
maintain their businesses in compliance in all material respects with
all applicable Environmental Laws and any other European Union,
national, federal, state and local laws, rules and regulation relating
to air emissions, water discharge, noise emissions, solid, or liquid
waste disposal, hazardous waste, or materials, or other environmental,
health or safety matters and there are no outstanding citations,
notices, or order of non-compliance issued to any of the Borrowers or
their Subsidiaries, or relating to the respective businesses, assets,
Real Estate, other property, leaseholds, or equipment of any of the
Borrowers or their Subsidiaries under any such laws, rules or
regulations; and
(c) None of the Borrowers and their Subsidiaries, any
Mortgaged Property and any of the other Real Estate is subject to any
applicable environmental law requiring the performance of Hazardous
Substances site assessments, or the removal or remediation of Hazardous
Substances, or the giving of notice to any governmental agency or the
recording or delivery to other Persons of an environmental disclosure
document or statement by virtue of the transactions set forth herein
and contemplated hereby, or as a
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condition to the recording of any Mortgage or to the effectiveness of
any other transactions contemplated hereby.
8.19. SUBSIDIARIES, ETC. A complete and correct list of the
Subsidiaries of each of the Borrowers and the jurisdictions of their
incorporation as of the Closing Date is set forth on Schedule 8.19 hereto.
Except as set forth on Schedule 8.19 hereto, none of the Borrowers nor any of
their Subsidiaries is engaged in any joint venture or partnership with any other
Person.
8.20. BANK ACCOUNTS. Schedule 8.20 sets forth the account numbers and
location of all bank accounts of each of the Borrowers and their Subsidiaries.
8.21. YEAR 2000 COMPLIANCE. The Borrowers and their Subsidiaries have
undertaken a review, the extent of which the Borrowers believe to be
commercially reasonable, of their critical business and operational systems
which could be adversely affected by, and have developed a program to address on
a timely basis, the "Year 2000 Problem" (i.e., the risk that computer
applications used by the Borrowers or any of their Subsidiaries may be unable to
recognize and perform properly date-sensitive functions involving certain dates
prior to and any date after December 31, 1999). Based upon such review and the
implementation of such program, the Borrowers reasonably believe that the "Year
2000 Problem" will not have any materially adverse effect on the business or
financial condition of the Borrowers or any of their Subsidiaries.
9. AFFIRMATIVE COVENANTS OF THE BORROWERS.
Each of the Borrowers covenants and agrees that, so long as any Loan,
Unpaid Reimbursement Obligation, Letter of Credit or Note is outstanding or any
Lender has any obligation to make any Loans or the Issuing Bank has any
obligation to issue, extend or renew any Letters of Credit:
9.1. PUNCTUAL PAYMENT. Each of the Borrowers will duly and punctually
pay or cause to be paid the principal and interest on the Loans, all
Reimbursement Obligations, the Letter of Credit Fees, the commitment fees, the
Agent's fee, the fronting fee and all other amounts provided for in this Credit
Agreement and the other Loan Documents to which any of the Borrowers or their
Subsidiaries is a party, all in accordance with the terms of this Credit
Agreement and such other Loan Documents.
9.2. MAINTENANCE OF OFFICES.
(a) TransTechnology and each of its Domestic Subsidiaries will maintain
its chief executive office in Liberty Corner, New Jersey, or at such other place
in the United States of America as TransTechnology shall designate upon written
notice to the Agent, where notices, presentations and demands to or upon
TransTechnology or such Subsidiary in respect of the Loan Documents to which
TransTechnology or such Subsidiary is a party may be given or made.
(b) GmbH will maintain its chief executive office in Konigstein,
Germany, or at such other place in Germany as GmbH shall designate upon written
notice to the Agent and the DM Fronting Bank, where notices, presentations and
demands to or upon GmbH in respect of the Loan Documents to which GmbH is a
party may be given or made.
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(c) Limited will maintain its registered office in Bingley, Yorkshire,
or at such other place in England as Limited shall designate upon written notice
to the Agent and the Sterling Fronting Bank, where notices, presentations and
demands to or upon Limited in respect of the Loan Documents to which Limited is
a party may be given or made.
9.3. RECORDS AND ACCOUNTS. Each of the Borrowers will, and will cause
each of its Subsidiaries to, (a) if such Borrower or Subsidiary is located in
the United States, keep true and accurate records and books of account in which
full, true and correct entries will be made in accordance with generally
accepted accounting principles and (b) if such Borrower or Subsidiary is located
outside the United States, keep true and accurate records and books of account
in which full, true and correct entries will be made in accordance with
generally accepted accounting principles in the country in which such Borrower
or Subsidiary, as the case may be, is located. Each of the Borrowers will
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation, depletion, obsolescence and amortization of its properties and the
properties of its Subsidiaries, contingencies, and other reserves.
9.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION.
Trans-Technology will deliver to each of the Lenders:
(a) as soon as practicable, but in any event not later than
one hundred (100) days after the end of each fiscal year of
TransTechnology, the consolidated balance sheet of TransTechnology and
its Subsidiaries and the consolidating balance sheet of TransTechnology
and its Subsidiaries, each as at the end of such year, and the related
consolidated and consolidating statements of income and consolidated
statement of cash flow for such year, each setting forth in comparative
form the figures for the previous fiscal year and all such consolidated
and consolidating statements to be in reasonable detail, prepared in
accordance with generally accepted accounting principles, and certified
(as to the consolidated statements) without qualification by Deloitte &
Touche LLP or by other independent certified public accountants
satisfactory to the Agent, together with a written statement from such
accountants to the effect that they have read a copy of this Credit
Agreement, and that, in making the examination necessary to said
certification, they have obtained no knowledge of any Default or Event
of Default, or, if such accountants shall have obtained knowledge of
any then existing Default or Event of Default they shall disclose in
such statement any such Default or Event of Default; provided that such
accountants shall not be liable to the Lenders for failure to obtain
knowledge of any Default or Event of Default;
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(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of
TransTechnology, copies of the unaudited consolidated balance sheet of
TransTechnology and its Subsidiaries and the unaudited consolidating
balance sheet of TransTechnology and its Subsidiaries, each as at the
end of such quarter, and the related consolidated and consolidating
statements of income and consolidated statement of cash flow for the
portion of TransTechnology's fiscal year then elapsed, all in
reasonable detail and prepared in accordance with generally accepted
accounting principles, together with a certification by the principal
financial or accounting officer of TransTechnology that the information
contained in such financial statements fairly presents the financial
position of TransTechnology and its Subsidiaries on the date thereof
(subject to year-end adjustments);
(c) simultaneously with the delivery of the financial
statements referred to in subsections (a) and (b) above, a statement
certified by the principal financial or accounting officer of
TransTechnology in substantially the form of Exhibit C hereto and
setting forth in reasonable detail computations evidencing compliance
with the covenants contained in Section 11 and (if applicable)
reconciliations to reflect changes in generally accepted accounting
principles since the Balance Sheet Date;
(d) contemporaneously with the filing or mailing thereof,
copies of all material filed with the Securities and Exchange
Commission or sent to the stockholders of TransTechnology which is
either of a financial nature or addresses the Year 2000 Problem;
(e) by April 30 of each year, the annual budget of
TransTechnology and its Subsidiaries for the next fiscal year; and
(f) from time to time such other financial data and
information (including accountants' management letters) as the Agent or
any Lender may reasonably request.
9.5. NOTICES.
9.5.1. DEFAULTS. Each of the Borrowers will promptly notify
the Agent and each of the Lenders in writing of the occurrence of any
Default or Event of Default. If any Person shall give any notice or
take any other action in respect of a claimed default (whether or not
constituting an Event of Default) under this Credit Agreement or any
other note, evidence of indebtedness, indenture or other obligation to
which or with respect to which any of the Borrowers or their
Subsidiaries is a party or obligor, whether as principal, guarantor,
surety or otherwise, each of the Borrowers shall forthwith give written
notice thereof to the Agent and each of the Lenders, describing the
notice or action and the nature of the claimed default.
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9.5.2. ENVIRONMENTAL EVENTS. Each of the Borrowers will
promptly give notice to the Agent and each of the Lenders (i) of any
violation of any Environmental Law that any of the Borrowers or their
Subsidiaries reports in writing or is reportable by such Person in
writing (or for which any written report supplemental to any oral
report is made) to any federal, state or local environmental agency and
(ii) upon becoming aware thereof, of any inquiry, proceeding,
investigation, or other action, including a notice from any agency of
potential environmental liability, or any federal, state or local
environmental agency or board, that has the potential to materially
affect the assets, liabilities, financial conditions or operations of
any of the Borrowers or their Subsidiaries, or the Agent's mortgages,
deeds of trust or security interests pursuant to the Security
Documents.
9.5.3. NOTIFICATION OF CLAIMS AGAINST COLLATERAL. Each of the
Borrowers will, immediately upon becoming aware thereof, notify the
Agent and each of the Lenders in writing of any setoff, claims
(including, with respect to the Real Estate, environmental claims),
withholdings or other defenses to which any of the Collateral, or the
Agent's rights with respect to the Collateral, are subject.
9.5.4. NOTICE OF LITIGATION AND JUDGMENTS. Each of the
Borrowers will, and will cause each of its Subsidiaries to, give notice
to the Agent and each of the Lenders in writing within fifteen (15)
days of becoming aware of any litigation or proceedings threatened in
writing or any pending litigation and proceedings affecting any of the
Borrowers or their Subsidiaries or to which any of the Borrowers or
their Subsidiaries is or becomes a party involving an uninsured claim
against any of the Borrowers or their Subsidiaries that could
reasonably be expected to have a materially adverse effect on any of
the Borrowers or their Subsidiaries and stating the nature and status
of such litigation or proceedings. Each of the Borrowers will, and will
cause each of its Subsidiaries to, give notice to the Agent and each of
the Lenders, in writing, in form and detail satisfactory to the Agent,
within ten (10) days of any judgment not covered by insurance, final or
otherwise, against such Borrower or any of its Subsidiaries in an
amount in excess of $250,000.
9.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. Each of the
Borrowers will do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, rights and franchises and
those of its Subsidiaries. Each of the Borrowers (i) will cause all of its
properties and those of its Subsidiaries used or useful in the conduct of its
business or the business of its Subsidiaries to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment,
(ii) will cause to be made all necessary repairs, renewals, replacements,
betterments and improvements thereof, all as in the judgment of such Borrower
may be necessary so that the business carried on in connection therewith may be
properly and advantageously conducted at all times, and (iii) will, and will
cause each of its Subsidiaries to, continue to engage primarily in the
businesses now conducted by them and in related businesses; provided that
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nothing in this Section 9.6 shall prevent any Borrower from discontinuing the
operation and maintenance of any of its properties or any of those of its
Subsidiaries if such discontinuance is, in the judgment of such Borrower,
desirable in the conduct of its or their business and that do not in the
aggregate materially adversely affect the business of any of the Borrowers and
their Subsidiaries on a consolidated basis.
9.7. INSURANCE.
Each of the Borrowers will, and will cause each of its Subsidiaries to,
maintain with financially sound and reputable insurers insurance with respect to
its properties and business against such casualties and contingencies as shall
be in accordance with the general practices of businesses engaged in similar
activities in similar geographic areas and in amounts, containing such terms, in
such forms and for such periods as may be reasonable and prudent and in
accordance with the terms of the Security Agreements, including provisions
naming the Agent as additional loss payee and providing for a minimum thirty
(30) days' notice to the Agent prior to cancellation. Each of the Borrowers
will, and will cause each of its Subsidiaries to, maintain insurance on the
Mortgaged Properties in accordance with the terms of the Mortgages. Upon
reasonable request from the Agent, the Borrowers shall furnish the Agent from
time to time with information concerning the Borrowers' and their Subsidiaries'
insurance, including (when requested) copies of the certificates of insurance
evidencing such insurance.
9.8. TAXES. Each of the Borrowers will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by law
become a lien or charge upon any of its property; provided that any such tax,
assessment, charge, levy or claim need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if such contesting Borrower or Subsidiary shall have set aside on its books
adequate reserves with respect thereto; and provided further that each of the
Borrowers and its Subsidiaries will pay all such taxes, assessments, charges,
levies or claims forthwith upon the commencement of proceedings to foreclose any
lien that may have attached as security therefor.
9.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
9.9.1. GENERAL. Each of the Borrowers shall permit the
Lenders, through the Agent or any of the Lenders' other designated
representatives, to visit and inspect any of the properties of such
Borrower and any of its Subsidiaries, to examine the books of account
of such Borrower and its Subsidiaries (and to make copies thereof and
extracts therefrom), and to discuss the affairs, finances and accounts
of such Borrower and its Subsidiaries with, and to be advised as to the
same by, its and their officers, all at such reasonable times and
intervals as the Agent or any Lender may reasonably request. Upon the
request of the Agent, TransTechnology will
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obtain and deliver to the Agent a report of an independent collateral
auditor satisfactory to the Agent (which may be affiliated with one of
the Lenders) setting forth such information regarding the Collateral as
the Agent may reasonably require. All such collateral value reports
shall be conducted and made at the expense of TransTechnology. If an
Event of Default shall have occurred and be continuing, each of the
Borrowers upon the request of the Agent, will obtain and deliver to the
Agent appraisal reports in form and substance and from appraisers
satisfactory to the Agent, stating (i) the then current fair market,
orderly liquidation and forced liquidation values of all or any portion
of the equipment or real estate owned by such Borrower or any of its
Subsidiaries and (ii) the then current business value of such Borrower
and its Subsidiaries. All such appraisals shall be conducted and made
at the expense of the Borrower obtaining and delivering such appraisal
reports.
9.9.2. ENVIRONMENTAL ASSESSMENTS. Whether or not an Event of
Default shall have occurred, the Agent may, from time to time, in its
discretion for the purpose of assessing and ensuring the value of any
Mortgaged Property, obtain one or more environmental assessments or
audits of such Mortgaged Property prepared by a hydrogeologist, an
independent engineer or other qualified consultant or expert approved
by the Agent to evaluate or confirm (i) whether any Hazardous Materials
are present in the soil or water at such Mortgaged Property and (ii)
whether the use and operation of such Mortgaged Property complies with
all Environmental Laws. Environmental assessments may include without
limitation detailed visual inspections of such Mortgaged Property
including any and all storage areas, storage tanks, drains, dry xxxxx
and leaching areas, and the taking of soil samples, surface water
samples and ground water samples, as well as such other investigations
or analyses as the Agent deems appropriate. All such environmental
assessments shall be conducted at the expense of TransTechnology.
9.9.3. COMMUNICATIONS WITH ACCOUNTANTS. Each of the Borrowers
authorizes the Agent and, if accompanied by the Agent, the Lenders to
communicate directly with such Borrower's independent certified public
accountants, provided that TransTechnology shall have received advance
notice of any such communications, and authorizes such accountants to
disclose to the Agent and the Lenders any and all financial statements
and other supporting financial documents and schedules including copies
of any management letter with respect to the business, financial
condition and other affairs of such Borrower or any of its
Subsidiaries. At the request of the Agent, each of the Borrowers shall
deliver a letter addressed to such accountants instructing them to
comply with the provisions of this Section 9.9.3.
9.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. Each of
the Borrowers will, and will cause each of its Subsidiaries to, comply in all
material respects with (i) the applicable laws and regulations wherever its
business is conducted, including all Environmental Laws, (ii) the provisions of
its charter documents and, in the event such by-laws exist, its by-laws, (iii)
all agreements and
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instruments by which it or any of its properties may be bound and (iv) all
applicable decrees, orders, and judgments. If any authorization, consent,
approval, permit or license from any officer, agency or instrumentality of any
government shall become necessary or required in order that any of the Borrowers
or their Subsidiaries may fulfill any of its obligations hereunder or any of the
other Loan Documents to which such Borrower or Subsidiary is a party, such
Borrower will, or (as the case may be) will cause such Subsidiary to,
immediately take or cause to be taken all reasonable steps within the power of
such Borrower or Subsidiary to obtain such authorization, consent, approval,
permit or license and furnish the Agent and the Lenders with evidence thereof.
9.11. EMPLOYEE BENEFIT PLANS. TransTechnology will (i) promptly upon
filing the same with the United States Department of Labor or Internal Revenue
Service, upon request of the Agent, furnish to the Agent a copy of the most
recent actuarial statement required to be submitted under Section 103(d) of
ERISA and Annual Report, Form 5500, with all required attachments, in respect of
each Guaranteed Pension Plan and (ii) promptly upon receipt or dispatch, furnish
to the Agent any notice, report or demand sent or received in respect of a
Guaranteed Pension Plan under Sections 302, 4041, 4042, 4043, 4063, 4065, 4066
and 4068 of ERISA, or in respect of a Multiemployer Plan, under Sections 4041A,
4202, 4219, 4242, or 4245 of ERISA. Each of the Borrowers and each of their
Subsidiaries shall comply with all applicable pension, retirement funding or
employee benefit legislation in any jurisdiction.
9.12. USE OF PROCEEDS. The proceeds of the Loans shall be used to
refinance certain Indebtedness of the Borrowers under the Original Credit
Agreement, to finance Approved Acquisitions, and for working capital and general
corporate purposes of the Borrowers. TransTechnology will obtain Letters of
Credit solely for working capital and general corporate purposes.
9.13. ADDITIONAL MORTGAGED PROPERTY. If, after the Closing Date, any of
the Borrowers or their Subsidiaries acquires or leases for a term in excess of
five (5) years real estate used as a manufacturing or warehouse facility, such
Borrower shall, or shall, upon the request of the Agent or the Majority Lenders,
cause such Subsidiary to, forthwith deliver to the Agent a fully executed
mortgage or deed of trust over such real estate, in form and substance
satisfactory to the Agent, together with title insurance policies, surveys,
evidences of insurance with the Agent named as loss payee and additional
insured, legal opinions and other documents and certificates with respect to
such real estate as was required for Real Estate of such Borrower or Subsidiary
as of the Closing Date. Each of the Borrowers further agrees that, following the
taking of such actions with respect to such real estate, the Agent shall have
for the benefit of the Lenders and the Agent a valid and enforceable first
priority mortgage or deed of trust over such real estate, free and clear of all
defects and encumbrances except for Permitted Liens.
9.14. BANK ACCOUNTS. Each of the Borrowers will, and will cause its
Subsidiaries to, together with the employees, agents and other Persons acting on
behalf of such Borrower or Subsidiary, receive and hold in trust for the Agent
and the Lenders all payments constituting proceeds of accounts receivable or
other
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Collateral which come into their possession or under their control and,
immediately upon receipt thereof, deposit such payments in the form received,
with any appropriate endorsements, in one of the accounts designated as a
lockbox or central depository account on Schedule 8.20.
9.15. INTEREST RATE PROTECTION. With effect from a date no later than
December 31, 1998, TransTechnology will maintain interest rate protection
arrangements on terms and conditions satisfactory to the Agent with respect to a
principal amount of at least $50,000,000 for a period of three (3) years from
the date of implementation of such arrangements; provided that if prior to
December 31, 1998, TransTechnology shall have issued at least $50,000,000 of
fixed rate debt, the requirement for interest rate protection arrangements
detailed in this Section 9.15 will be considered met.
9.16. FURTHER ASSURANCES. Each of the Borrowers will, and will cause
each of its Subsidiaries to, cooperate with the Lenders and the Agent and
execute such further instruments and documents as the Lenders or the Agent shall
reasonably request to carry out to their satisfaction the transactions
contemplated by this Credit Agreement and the other Loan Documents.
10. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS.
Each of the Borrowers covenants and agrees that, so long as any Loan,
Unpaid Reimbursement Obligation, Letter of Credit or Note is outstanding or any
Lender has any obligation to make any Loans or the Issuing Bank has any
obligations to issue, extend or renew any Letters of Credit:
10.1. RESTRICTIONS ON INDEBTEDNESS. The Borrowers will not, and will
not permit any of their Subsidiaries to, create, incur, assume, guarantee, or be
or remain liable, contingently or otherwise, with respect to, any Indebtedness
other than:
(a) Indebtedness to the Lenders and the Agent arising under
any of the Loan Documents;
(b) current liabilities of any of the Borrowers or their
Subsidiaries incurred in the ordinary course of business not incurred
through (i) the borrowing of money, or (ii) the obtaining of credit
except for credit on an open account basis customarily extended and in
fact extended in connection with normal purchases of goods and
services;
(c) Indebtedness in respect of taxes, assessments,
governmental charges or levies and claims for labor, materials and
supplies to the extent that payment therefor shall not at the time be
required to be made in accordance with the provisions of Section 9.8;
(d) Indebtedness in respect of judgments or awards that have
been in force for less than the applicable period for taking an appeal
so long as
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execution is not levied thereunder or in respect of which any of the
Borrowers or Subsidiary shall at the time in good faith be prosecuting
an appeal or proceedings for review and in respect of which a stay of
execution shall have been obtained pending such appeal or review;
(e) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the
ordinary course of business;
(f) Subordinated Debt not exceeding $125,000,000 in aggregate
principal amount at any time outstanding;
(g) obligations under Capitalized Leases not exceeding
$8,000,000 in aggregate amount at any time outstanding;
(h) Indebtedness incurred in connection with the acquisition
after the date hereof of any real or personal property by any of the
Borrowers or their Subsidiaries, provided that the aggregate principal
amount of such Indebtedness of TransTechnology and its Subsidiaries
shall not exceed the aggregate amount of $5,000,000 at any one time;
(i) Indebtedness existing on the date hereof and listed and
described on Schedule 10.1 hereto; and
(j) Indebtedness of any Subsidiary of TransTechnology to
TransTechnology; provided that such Indebtedness shall be evidenced by
promissory notes duly executed by the obligor, and all such
intercompany notes shall be pledged and delivered to the Agent and be
in form and substance satisfactory to the Agent.
10.2. RESTRICTIONS ON LIENS. The Borrowers will not, and will not
permit any of their Subsidiaries to, (i) create or incur or suffer to be created
or incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (ii) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (iii) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (iv) suffer to
exist for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; or (v) sell, assign, pledge or otherwise
transfer any accounts, contract rights, general intangibles, chattel paper or
instruments, with or without recourse; provided that the Borrowers and their
Subsidiaries may create or incur or suffer to be created or incurred or to
exist:
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(a) liens in favor of a Borrower on all or part of the assets
of Subsidiaries of such Borrower securing Indebtedness owing by such
Subsidiaries to such Borrower;
(b) liens to secure taxes, assessments and other government
charges in respect of obligations not overdue or liens on properties
other than Mortgaged Properties to secure claims for labor, material or
supplies in respect of obligations not overdue or delinquent;
(c) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(d) liens on properties other than Mortgaged Properties in
respect of judgments or awards, the Indebtedness with respect to which
is permitted by Section 10.1(d);
(e) liens of carriers, warehousemen, mechanics and
materialmen, and other like liens on properties other than Mortgaged
Properties, in existence less than 120 days from the date of creation
thereof in respect of obligations not overdue or delinquent;
(f) encumbrances on Real Estate other than the Mortgaged
Property consisting of easements, rights of way, zoning restrictions,
restrictions on the use of real property and defects and irregularities
in the title thereto, landlord's or lessor's liens under leases to
which a Borrower or a Subsidiary of a Borrower is a party, and other
minor liens or encumbrances none of which in the opinion of the
Borrowers interferes materially with the use of the property affected
in the ordinary conduct of the business of the Borrowers and their
Subsidiaries, which defects do not individually or in the aggregate
have a materially adverse effect on the business of any Borrower
individually or of TransTechnology and its Subsidiaries on a
consolidated basis;
(g) liens existing on the date hereof and listed on Schedule
10.2 hereto;
(h) security interests in, or purchase money mortgages on,
real or personal property other than Mortgaged Properties acquired
after the date hereof to secure Indebtedness of the type and amount
permitted by Section 10.1(h) and incurred in connection with the
acquisition of such property, which security interests or mortgages
cover only the real or personal property so acquired (or comparable
security interests, such as collateral assignments or retention of
title agreements entered into in the ordinary course of business);
(i) liens and encumbrances on each Mortgaged Property as and
to the extent permitted by the Mortgage applicable thereto; and
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(j) liens in favor of the Agent for the benefit of the Lenders
and the Agent under the Loan Documents.
10.3. RESTRICTIONS ON INVESTMENTS. The Borrowers will not, and will not
permit any of their Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America, the Federal Republic of Germany or the United
Kingdom that mature within one (1) year from the date of purchase;
(b) demand deposits, certificates of deposit, bankers
acceptances and time deposits of United States banks having total
assets in excess of $1,000,000,000 or, with respect to Subsidiaries of
TransTechnology located outside the United States, deposit accounts
with local banks having total assets in excess of $1,000,000,000 or the
local currency equivalent thereof;
(c) securities commonly known as "commercial paper" issued by
a corporation organized and existing under the laws of the United
States of America or any state thereof that at the time of purchase
have been rated and the ratings for which are not less than "P 1" if
rated by Xxxxx'x Investors Services, Inc., and not less than "A 1" if
rated by Standard and Poor's;
(d) Investments existing on the date hereof and listed on
Schedule 10.3 hereto;
(e) Investments with respect to Indebtedness permitted by
Section 10.1(j) so long as such entities remain Subsidiaries of
TransTechnology;
(f) Investments consisting of the Guaranties or Investments by
TransTechnology in Subsidiaries of TransTechnology existing on the
Closing Date;
(g) Investments consisting of promissory notes received as
proceeds of asset dispositions permitted by Section 10.5.2;
(h) Investments consisting of loans and advances to employees
for moving, entertainment, travel and other similar expenses in the
ordinary course of business not to exceed $250,000 in the aggregate at
any time outstanding; and (i) other Investments in an aggregate amount
not in excess of $100,000;
provided, however, that, with the exception of demand deposits referred to in
Section 10.3(b) and loans and advances referred to in Section 10.3(h), such
Investments will be considered Investments permitted by this Section 10.3 only
if all actions have been taken to the satisfaction of the Agent to provide to
the Agent, for the benefit of the
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Lenders and the Agent, a first priority perfected security interest in all of
such Investments free of all encumbrances other than Permitted Liens.
10.4. DISTRIBUTIONS. TransTechnology will not make, or permit any of
its Subsidiaries to make, any Distributions except that, so long as no Default
or Event of Default has occurred and is continuing or would result therefrom.
TransTechnology may make Distributions with respect to each fiscal quarter
commencing on or after April 1, 1998, within ninety (90) days following the end
of such fiscal quarter, provided that the aggregate amount of all Distributions
declared and/or paid pursuant to this Section 10.4 with respect to each
Reference Period ending after the date hereof, shall not exceed twenty-five
percent (25%) of Consolidated Net Income for such Reference Period.
10.5. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
10.5.1. MERGERS AND ACQUISITIONS. The Borrowers will not, and
will not permit any of their Subsidiaries to, become a party to any
merger or consolidation, to convert any of the Borrowers or their
Subsidiaries from one form of corporate organization or partnership to
another, or agree to or effect any asset acquisition or stock
acquisition, other than:
(a) the acquisition of assets (other than assets
which constitutes all or a substantial part of a business or
division) in the ordinary course of business consistent with
the past practices of the TransTechnology Group;
(b) Approved Acquisitions, subject to fulfillment of
the conditions set forth in the definition thereof;
(c) the merger or consolidation of one or more of the
Subsidiaries of TransTechnology with and into TransTechnology;
or
(d) the merger, conversion or consolidation of two or
more Subsidiaries of TransTechnology, provided that no assets
of any such Subsidiary which prior to such merger or
consolidation were pledged to the Agent or the Lenders or in
or over which the Agent or the Lenders had any security
interest, charge, lien or other encumbrance shall, as a result
of such merger, conversion or consolidation, cease to be so
pledged or otherwise encumbered.
10.5.2. DISPOSITION OF ASSETS. The Borrowers will not, and
will not permit any of their Subsidiaries to, become a party to or
agree to or effect any disposition of assets, other than:
(a) the disposition of assets (other than assets
which constitutes all or a substantial part of a business or
division) in the ordinary course of business, consistent with
the past practices of the TransTechnology Group;
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(b) the disposition of the assets listed in Schedule
10.5.2, provided that (i) such disposition is for
consideration equal to or greater than the fair market value
of such assets, as determined by the management of the selling
member of the TransTechnology Group in its reasonable
discretion and (ii) the proceeds of any such disposition shall
be paid to the Agent for the account of the Lenders, to be
applied against the Loans in accordance with Section 4.3; and
(c) the disposition of the assets identified on the
most recent balance sheet of TransTechnology and its
Subsidiaries as belonging to or employed in operations
identified in such balance sheet as discontinued operations of
the TransTechnology Group, provided that the proceeds of any
such disposition shall be paid to the Agent for the account of
the Lenders, to be applied against the Loans in accordance
with Section 4.3;
provided, however, that in the event of any disposition of assets specifically
permitted pursuant to this Section 10.5.2, the Agent shall be required, upon the
request of any of the Borrowers, to release any security interest in the Agent's
favor on any such assets, and the Agent is hereby authorized to release any such
security interest by each of the Lenders.
10.6. SALE AND LEASEBACK. The Borrowers will not, and will not permit
any of their Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby any Borrower or Subsidiary of a Borrower shall sell or
transfer any property owned by it in order then or thereafter to lease such
property or lease other property that any member of the TransTechnology Group
intends to use for substantially the same purpose as the property being sold or
transferred.
10.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrowers will not, and
will not permit any of their Subsidiaries to, (i) construct or install on any of
the Real Estate any underground tank or other underground storage receptacle for
Hazardous Substances, (ii) conduct any activity at any Real Estate or use any
Real Estate in any manner so as to cause any material release (i.e., releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, disposing or dumping) of Hazardous Substances on, upon or
into the Real Estate, or (iii) otherwise conduct any activity at any Real Estate
or use any Real Estate in any manner that would be in material violation of any
Environmental Law or bring such Real Estate in material violation of any
Environmental Law.
10.8. SUBORDINATED DEBT. Without the prior written consent of the
Majority Lenders and the Agent, TransTechnology will not, and will not permit
any of its Subsidiaries to:
(a) amend or modify the provisions of any Subordinated Debt so
as to affect the subordination of such Subordinated Debt to the
Obligations, or accelerate the required payment dates or the maturity
of such Subordinated Debt, or impose upon TransTechnology and its
Subsidiaries materially more
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onerous or restrictive covenants, events of default or remedies, or
otherwise and in similar fashion adversely affect the interests of the
Lenders hereunder in any material respect; or
(b) make any optional payment, prepayment, redemption or
repurchase of any Subordinated Debt, including without limitation any
payments on account of or for any sinking fund or other similar fund
for the repurchase, retirement or redemption of Subordinated Debt,
other than as required by the terms thereof and in accordance with the
subordination provisions applicable thereto.
10.9. EMPLOYEE BENEFIT PLANS. Neither TransTechnology nor any ERISA
Affiliate will:
(a) engage in any "prohibited transaction" within the meaning
of Section 406 of ERISA or Section 4975 of the Code which could result
in a material liability for TransTechnology or any of its Subsidiaries;
or
(b) permit any Guaranteed Pension Plan to incur an
"accumulated funding deficiency", as such term is defined in Section
302 of ERISA, whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner
which, could result in the imposition of a lien or encumbrance on the
assets of TransTechnology or any of its Subsidiaries pursuant to
Section 302(f) or Section 4068 of ERISA; or
(d) permit or take any action which would result in the
aggregate benefit liabilities (with the meaning of Section 4001 of
ERISA) of all Guaranteed Pension Plans exceeding the value of the
aggregate assets of such Plans, disregarding for this purpose the
benefit liabilities and assets of any such Plan with assets in excess
of benefit liabilities.
10.10. BANK ACCOUNTS. TransTechnology will not, and will not permit any
of its Subsidiaries to, (i) establish any bank accounts other than those listed
on Schedule 8.20 without the Agent's prior written consent, (ii) violate
directly or indirectly any bank agency or lock box agreement in favor of the
Agent for the benefit of the Lenders and the Agent with respect to such account,
or (iii) deposit into any of the payroll accounts listed on Schedule 8.20 any
amounts in excess of amounts necessary to pay current payroll obligations from
such accounts.
10.11. OPERATING LEASES. The Borrowers will not, and will not permit
any of their Subsidiaries to, create, incur, assume, guarantee or remain liable
for, contingently or otherwise, any Rental Obligations with respect to Operating
Leases in excess of an aggregate amount of $4,500,000 scheduled to become due
and payable in any fiscal year.
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10.12. SO OHG PARTNERSHIP AGREEMENT. TransTechnology will not, and will
not permit any of its Subsidiaries to, amend, supplement, restate or otherwise
modify the Partnership Agreement of SO OHG as in effect as of October 27, 1995,
in any way which adversely affects any of the security interests created by the
German Security Documents or otherwise adversely affects the interest of the
Agent or any of the Lenders, without the prior written consent of the Agent, the
DM Fronting Bank and the Majority Lenders.
10.13. MAINTENANCE OF BUSINESS. The Borrowers will not, and will not
permit any of their Subsidiaries to, materially change the business of such
Borrower or Subsidiary from the Business.
11. FINANCIAL COVENANTS OF THE BORROWERS.
The Borrowers jointly and severally covenant and agree that, so long as
any Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is
outstanding or any Lender has any obligation to make any Loans or the Issuing
Bank has any obligation to issue, extend or renew any Letters of Credit:
11.1. CONSOLIDATED EBITDA TO CONSOLIDATED TOTAL INTEREST EXPENSE.
TransTechnology will not permit the ratio of Consolidated EBITDA for any
Reference Period ending on or before September 30, 1999, to Consolidated Total
Interest Expense for such Reference Period to be less than 3.25:1, and will not
permit the ration of Consolidated EBITDA for any Reference Period ending after
September 30, 1999, to Consolidated Total Interest Expense for such Reference
Period to be less than 3.50:1.
11.2. DEBT TO CAPITAL RATIO. TransTechnology will not permit Funded
Indebtedness, at any time, as a percentage of the sum of Funded Indebtedness and
Total Shareholders' Equity at such time, to exceed 60%.
11.3. LEVERAGE RATIO. TransTechnology will not permit the Leverage
Ratio at any time to exceed 3.75:1.
11.4. MINIMUM NET WORTH. TransTechnology will not permit Consolidated
Net Worth at any time to be less than $97,000,000, as such amount may be
increased at the end of each fiscal quarter (commencing with the fiscal quarter
ending on or around December 31, 1998), for the fiscal quarter thereafter, by
the addition of seventy-five percent (75%) of Consolidated Net Income earned
after September 30, 1998.
11.5. CAPITAL EXPENDITURES. TransTechnology will not make, or permit
any Subsidiary of TransTechnology to make, Capital Expenditures in any fiscal
year that exceed in the aggregate for such fiscal year the amount set forth for
such fiscal year in the chart below:
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Fiscal Year Amount
----------- ------
Ending on March 31, 1999 $11,800,000
Ending on March 31, 2000 $12,800,000
Ending on March 31, 2001 $14,800,000
Ending on March 31, 2002 $15,800,000
and thereafter
provided that, if during any fiscal year the amount of Capital Expenditures
permitted for that fiscal year is not utilized, the unutilized amount may be
utilized in any subsequent fiscal year, provided, however, that the aggregate
amount of (i) the unutilized portion from any one fiscal year, plus (ii) any
unutilized portion previously carried forward and which remains unutilized,
which may be carried forward from one fiscal year to the subsequent fiscal year
shall not exceed $2,000,000. For the purposes of this Section 11.5, Capital
Expenditures shall not include (a) any amounts in respect of leases in effect on
the Closing Date and classified at such time as Operating Leases, which shall
have been reclassified as Capitalized Leases subsequent to the Closing Date, or
(b) any amounts classified in the Projections on the Closing Date as goodwill
with respect to Aerospace Rivet Manufacturers Corporation, a Subsidiary of
TransTechnology, which shall have been reclassified so as to fall within the
definition of Capital Expenditures subsequent to the Closing Date.
12. CLOSING CONDITIONS.
The obligations of the Lenders to make the initial Revolving Credit
Loans, of the Fronting Banks to make the initial International Facility Loans,
and of the Issuing Bank to issue any initial Letters of Credit shall be subject
to the satisfaction of the following conditions precedent on or prior to the
Closing Date:
12.1. LOAN DOCUMENTS. Each of the Loan Documents shall have been duly
executed and delivered by the respective parties thereto, shall be in full force
and effect and shall be in form and substance satisfactory to each of the
Lenders. The Agent shall have received a fully executed copy of each such
document.
12.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. Each of the Lenders shall
have received from TransTechnology and each of its Subsidiaries a copy,
certified by a duly authorized officer of such Person to be true and complete on
the Closing Date, of each of (i) its charter or other incorporation documents as
in effect on such date of certification, and (ii) its by-laws as in effect on
such date.
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12.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by TransTechnology and each of its
Subsidiaries of this Credit Agreement and the other Loan Documents to which it
is or is to become a party shall have been duly and effectively taken, and
evidence thereof satisfactory to the Lenders shall have been provided to each of
the Lenders.
12.4. INCUMBENCY CERTIFICATE. Each of the Lenders shall have received
from TransTechnology and each of its Subsidiaries an incumbency certificate,
dated as of the Closing Date, signed by a duly authorized officer of
TransTechnology or such Subsidiary, and giving the name and bearing a specimen
signature of each individual who shall be authorized: (i) to sign, in the name
and on behalf of each of TransTechnology and such Subsidiary, each of the Loan
Documents and Acquisition Documents to which TransTechnology or such Subsidiary
is or is to become a party; and (ii) in the case and the Borrowers, to make Loan
Requests and Conversion Requests, to apply for Letters of Credit, and to give
notices and to take other action on behalf of the Borrowers under the Loan
Documents.
12.5. VALIDITY OF LIENS. The Security Documents shall be effective to
create in favor of the Agent a legal, valid and enforceable first (except for
Permitted Liens entitled to priority under applicable law) security interest in
and lien upon the Collateral. All filings, recordings, deliveries of instruments
and other actions necessary or desirable in the opinion of the Agent to protect
and preserve such security interests shall have been duly effected. The Agent
shall have received evidence thereof in form and substance satisfactory to the
Agent.
12.6. PERFECTION CERTIFICATES AND UCC SEARCH RESULTS. The Agent shall
have received from each of TransTechnology and its Subsidiaries a completed and
fully executed Perfection Certificate and the results of UCC searches or
searches of any other relevant register of charges or commercial register with
respect to the Collateral, indicating no liens other than Permitted Liens and
otherwise in form and substance satisfactory to the Agent.
12.7. SURVEYS. The Agent shall have received a Survey of each Mortgaged
Property as to which a survey has been conducted on or prior to the date hereof.
12.8. TITLE INSURANCE. The Agent shall have received a Title Policy
covering each Mortgaged Property located in the United States (or commitments to
issue such policies, with all conditions to issuance of the Title Policy deleted
by an authorized agent of the Title Insurance Company) together with proof of
payment of all fees and premiums for such policies, from the Title Insurance
Company and in amounts satisfactory to the Agent, insuring the interest of the
Agent and each of the Lenders as mortgagee under the Mortgages.
12.9. LANDLORD CONSENTS. TransTechnology and its Subsidiaries shall
have delivered to the Agent all consents required for the Agent to receive, as
part of the Security Documents, a collateral assignment of each material
leasehold of personal property, together in each case with such estoppel
certificates as the Agent may request.
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12.10. CERTIFICATES OF INSURANCE. The Agent shall have received (i) a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms, and otherwise describing the insurance obtained in accordance with
the provisions of the Security Agreements and (ii) certified copies of all
policies evidencing such insurance (or certificates therefore signed by the
insurer or an agent authorized to bind the insurer).
12.11. BANK AGENCY AGREEMENTS. The Agent shall have received an
agreement, in form and substance satisfactory to the Agent, from each bank at
which TransTechnology or any of its Subsidiaries maintains depository accounts
(including bank agency or lock box agreements) concerning the Agent's interest
for the benefit of the Lenders and the Agent in such accounts.
12.12. HAZARDOUS WASTE ASSESSMENTS. The Agent shall have received
hazardous waste site assessments from environmental engineers or other
documentation in form and substance satisfactory to the Agent, covering all
Mortgaged Property and all other real property in respect of which
TransTechnology or any of its Subsidiaries may have material liability, whether
contingent or otherwise, for dumping or disposal of Hazardous Substances.
12.13. SOLVENCY CERTIFICATE. Each of the Lenders shall have received an
officer's certificate of TransTechnology dated as of the Closing Date as to the
solvency of TransTechnology and its Subsidiaries following the consummation of
the transactions contemplated herein and in form and substance satisfactory to
the Lenders.
12.14. OPINIONS OF COUNSEL. Each of the Lenders and the Agent shall
have received a favorable legal opinion addressed to the Lenders and the Agent,
dated as of the Closing Date, in form and substance satisfactory to the Lenders
and the Agent, from:
(a) Xxxx Xxxxxx Parks LLP, counsel to TransTechnology and its
Subsidiaries in the United States;
(b) Xxxxx, Day, Xxxxxx & Xxxxx, counsel to TransTechnology and
its Subsidiaries in the Federal Republic of Germany;
(c) Eversheds, solicitors to Limited; and
(d) if requested by the Agent such other local counsel to
TransTechnology in any jurisdiction where any Collateral (including but
not limited to the Mortgaged Property) is located.
12.15. PAYMENT OF FEES. TransTechnology shall have paid to the Agent
the closing fee pursuant to Section 6.1 and shall have paid to the Arranger the
structuring fee pursuant to Section 6.1.
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13. CONDITIONS TO ALL BORROWINGS.
The obligations of the Lenders to make any Revolving Credit Loans, of
the Fronting Banks to make any International Facility Loans, and of the Issuing
Bank to issue, extend or renew any Letter of Credit, in each case whether on or
after the Closing Date, shall also be subject to the satisfaction of the
following conditions precedent:
13.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of any of TransTechnology and its Subsidiaries
contained in this Credit Agreement, the other Loan Documents or in any document
or instrument delivered pursuant to or in connection with this Credit Agreement
shall be true as of the date as of which they were made and shall also be true
at and as of the time of the making of such Loan or the issuance, extension or
renewal of such Letter of Credit, with the same effect as if made at and as of
that time (except to the extent of changes resulting from transactions
contemplated or permitted by this Credit Agreement and the other Loan Documents
and changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and to the extent that such individual
representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing. Upon the
request of the Agent, TransTechnology shall have delivered to the Agent a
certificate of TransTechnology signed by an authorized officer of
TransTechnology to such effect.
13.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Lender would make it illegal for such Lender to make such Loan pursuant
to the provisions of this Credit Agreement, or to participate in the issuance,
extension or renewal of such Letter of Credit or in the reasonable opinion of
the Issuing Bank would make it illegal for the Issuing Bank to issue, extend or
renew such Letter of Credit.
13.3. GOVERNMENTAL REGULATION. Each Lender shall have received such
statements in substance and form reasonably satisfactory to such Lender as such
Lender shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of the
Federal Reserve System or any other applicable regulatory or supervisory body.
13.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents,
the Acquisition Documents and all other documents incident thereto shall be
satisfactory in substance and in form to the Lenders and to the Agent and the
Agent's Special Counsel, and the Lenders, the Agent and such counsel shall have
received all information and such counterpart originals or certified or other
copies of such documents as the Agent may reasonably request.
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14. EVENTS OF DEFAULT; ACCELERATION; ETC.
14.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse of time or
both is required, then, prior to such notice or lapse of time, "Defaults") shall
occur:
(a) any of the Borrowers shall fail to pay any principal of
the Loans or any Reimbursement Obligation when the same shall become
due and payable, whether at the stated date of maturity or any
accelerated date of maturity or at any other date fixed for payment;
(b) any of the Borrowers or their Subsidiaries shall fail to
pay any interest on the Loans, the commitment fee, any Letter of Credit
Fee, the Agent's fee, the fronting fee, or other sums due hereunder or
under any of the other Loan Documents, when the same shall become due
and payable, whether at the stated date of maturity or any accelerated
date of maturity or at any other date fixed for payment;
(c) any of the Borrowers or their Subsidiaries shall fail to
comply with any of its covenants contained in Section 9, 10 or 11 or
any of the covenants contained in any of the Mortgages or in the
Debenture;
(d) any of the Borrowers or their Subsidiaries shall fail to
perform any term, covenant or agreement contained herein or in any of
the other Loan Documents (other than those specified elsewhere in this
Section 14.1 or those which by their terms expressly exclude any grace
period for any non-compliance therewith) for fifteen (15) days after
written notice of such failure has been given to TransTechnology by the
Agent;
(e) any representation or warranty of or any of the Borrowers
or their Subsidiaries in this Credit Agreement or any of the other Loan
Documents or in any other document or instrument delivered pursuant to
or in connection with this Credit Agreement shall prove to have been
false in any material respect upon the date when made or deemed to have
been made or repeated;
(f) any of the Borrowers or their Subsidiaries shall fail to
pay at maturity, or within any applicable period of grace, any
obligation for borrowed money or credit received or in respect of any
Capitalized Leases, or fail to observe or perform any material term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money or credit received or in respect
of any Capitalized Leases for such period of time as would permit
(assuming the giving of appropriate notice if required) the holder or
holders thereof or of any obligations issued thereunder to accelerate
the maturity thereof;
(g) any of the Borrowers or their Subsidiaries shall make an
assignment for the benefit of creditors, or admit in writing its
inability to pay
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or generally fail to pay its debts as they mature or become due, or
shall petition or apply for the appointment of a trustee or other
custodian, liquidator or receiver of such Borrower or Subsidiary or of
any substantial part of the assets of such Borrower or Subsidiary or
shall commence any case or other proceeding relating to any of the
Borrowers or their Subsidiaries under any bankruptcy, reorganization,
arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in
effect, or shall take any action to authorize or in furtherance of any
of the foregoing, or if any such petition or application shall be filed
or any such case or other proceeding shall be commenced against or any
of the Borrowers or their Subsidiaries and any of the Borrowers or
their Subsidiaries shall indicate its approval thereof, consent thereto
or acquiescence therein or such petition or application shall not have
been dismissed within forty-five (45) days following the filing
thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver or adjudicating any of the Borrowers
or their Subsidiaries bankrupt or insolvent, or approving a petition in
any such case or other proceeding, or a decree or order for relief is
entered in respect of any of the Borrowers or their Subsidiaries in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty (30) days, whether or not consecutive,
any final judgment against any of the Borrowers or their Subsidiaries
that, with other outstanding final judgments, undischarged, against the
Borrowers and their Subsidiaries exceeds in the aggregate $1,000,000;
(j) if any of the Loan Documents shall be cancelled,
terminated, revoked or rescinded or the Agent's security interests,
mortgages or liens in a substantial portion of the Collateral shall
cease to be perfected, or shall cease to have the priority contemplated
by the Security Documents, in each case otherwise than in accordance
with the terms thereof or with the express prior written agreement,
consent or approval of the Lenders (and, notwithstanding anything
herein to the contrary, if any guaranty shall be cancelled, terminated,
revoked or rescinded without the consent of the Lenders), or any action
at law, suit or in equity or other legal proceeding to cancel, revoke
or rescind any of the Loan Documents shall be commenced by or on behalf
of any of the Borrowers or their Subsidiaries party thereto or any of
their respective stockholders, or any court or any other governmental
or regulatory authority or agency of competent jurisdiction shall make
a determination that, or issue a judgment, order, decree or ruling to
the effect that, any one or more of the Loan Documents is illegal,
invalid or unenforceable in accordance with the terms thereof;
(k) with respect to any Guaranteed Pension Plan, an ERISA
Reportable Event shall have occurred and the Majority Lenders shall
have determined in their reasonable discretion that such event
reasonably could
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be expected to result in liability of TransTechnology or any of its
Subsidiaries to the PBGC or such Guaranteed Pension Plan in an
aggregate amount exceeding $250,000 and such event in the circumstances
occurring reasonably could constitute grounds for the termination of
such Guaranteed Pension Plan by the PBGC or for the appointment by the
appropriate United States District Court of a trustee to administer
such Guaranteed Pension Plan; or a trustee shall have been appointed by
the United States District Court to administer such Plan; or the PBGC
shall have instituted proceedings to terminate such Guaranteed Pension
Plan;
(l) any of the Borrowers or their Subsidiaries shall be
enjoined, restrained or in any way prevented by the order of any court
or any administrative or regulatory agency from conducting any material
part of its business and such order has a material adverse effect on
the business or financial condition of such Borrower or Subsidiary;
(m) there shall occur any material damage to, or loss, theft
or destruction of, any Collateral, whether or not insured, or any
strike, lockout, labor dispute, embargo, condemnation, act of God or
public enemy, or other casualty, which in any such case causes, for
more than fifteen (15) consecutive days, the cessation or substantial
curtailment of revenue producing activities at any facility of any of
the Borrowers or their Subsidiaries if such event or circumstance is
not covered by business interruption insurance and would have a
material adverse effect on the business or financial condition of such
Borrower or Subsidiary;
(n) there shall occur the loss, suspension or revocation of,
or failure to renew, any license or permit now held or hereafter
acquired by any of the Borrowers or their Subsidiaries if such loss,
suspension, revocation or failure to renew would have a material
adverse effect on the business or financial condition of such Borrower
or Subsidiary;
(o) any of the Borrowers or their Subsidiaries shall be
indicted for a state or federal crime, or any civil or criminal action
shall otherwise have been brought against any of the Borrowers or their
Subsidiaries, a punishment for which in any such case could include the
forfeiture of any assets of such Borrower or Subsidiary having a fair
market value in excess of $1,000,000;
(p) any person or group of persons (within the meaning of
Section 13 or 14 of the Securities Exchange Act of 1934, as amended)
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 promulgated by the Securities and Exchange Commission under said
Act) of 25% or more of the outstanding shares of common stock of
TransTechnology; or, during any period of twelve consecutive calendar
months, individuals who were directors of TransTechnology on the first
day of such period shall cease to constitute a majority of the board of
directors of TransTechnology;
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then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Lenders shall, by notice in writing to
the Borrowers declare all amounts owing with respect to this Credit Agreement,
the Loans, the Notes and the other Loan Documents and all Reimbursement
Obligations to be, and they shall thereupon forthwith become, immediately due
and payable without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by each of the Borrowers; provided that
in the event of any Event of Default specified in Section 14.1(g) or 14.1(h),
all such amounts shall become immediately due and payable automatically and
without any requirement of notice from the Agent or any Lender.
14.2. TERMINATION OF COMMITMENT. If any one or more of the Events of
Default specified in Section 14.1(g), Section 14.1(h) or Section 14.1(j) shall
occur, any unused portion of the credit hereunder shall forthwith terminate and
each of the Lenders (including the Fronting Banks) shall be relieved of all
further obligations to make Loans to any of the Borrowers and the Issuing Bank
shall be relieved of all further obligations to issue, extend or renew Letters
of Credit. If any other Event of Default shall have occurred and be continuing,
or if on any Drawdown Date or other date for issuing, extending or renewing any
Letter of Credit the conditions precedent to the making of the Loans to be made
on such Drawdown Date or (as the case may be) to issuing, extending or renewing
such Letter of Credit on such other date are not satisfied the Agent may and,
upon the request of the Majority Lenders, shall, by notice to the Borrowers,
terminate the Commitments hereunder, and upon such notice being given such
Commitments shall terminate immediately and each of the Lenders (including the
Fronting Banks) shall be relieved of all further obligations to make Loans and
the Issuing Bank shall be relieved of all further obligations to issue, extend
or renew Letters of Credit. No termination of the Commitments shall relieve any
of the Borrowers or their Subsidiaries of any of the Obligations.
14.3. REMEDIES. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Agent or the Majority
Lenders shall have accelerated the maturity of the Loans pursuant to
Section 14.1, each Lender, if owed any amount with respect to the Loans or the
Reimbursement Obligations, may, with the consent of the Majority Lenders but not
otherwise, proceed to protect and enforce its rights by suit in equity, action
at law or other appropriate proceeding, whether for the specific performance of
any covenant or agreement contained in this Credit Agreement and the other Loan
Documents or any instrument pursuant to which the Obligations to such Lender are
evidenced, including as permitted by applicable law the obtaining of the ex
parte appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Lender. No remedy herein conferred upon any
Lender or the Agent or the holder of any Note or purchaser of any Letter of
Credit Participation is intended to be exclusive of any other remedy herein or
in any of the other Loan Documents and each and every remedy shall be cumulative
and shall be in addition to every other remedy given hereunder or under any of
the other Loan Documents or now or hereafter existing at law or in equity or by
statute or any other provision of law.
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14.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that, following
the occurrence or during the continuance of any Default or Event of Default, the
Agent or any Lender, as the case may be, receives any monies in connection with
the enforcement of any the Security Documents, or otherwise with respect to the
realization upon any of the Collateral, such monies shall be distributed for
application as follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies
by the Agent, for the exercise, protection or enforcement by the Agent
of all or any of the rights, remedies, powers and privileges of the
Agent under this Credit Agreement or any of the other Loan Documents or
in respect of the Collateral or in support of any provision of adequate
indemnity to the Agent against any taxes or liens which by law shall
have, or may have, priority over the rights of the Agent to such
monies;
(b) Second, to all other Obligations in such order or
preference as the Majority Lenders may determine; provided, however,
that distributions in respect of such obligations shall be made (i)
pari passu among Obligations with respect to the Agent's fee payable
pursuant to Section 6.2 and all other Obligations and (ii) Obligations
owing to the Lenders with respect to each type of Obligation such as
interest, principal, fees and expenses, shall be made among the Lenders
pro rata; and provided, further, that the Agent may in its discretion
make proper allowance to take into account any Obligations not then due
and payable;
(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Lenders and the
Agent of all of the Obligations, to the payment of any obligations
required to be paid pursuant to Section 9-504(1)(c) of the Uniform
Commercial Code of the Commonwealth of Massachusetts; and
(d) Fourth, the excess, if any, shall be returned to the
Borrowers or to such other Persons as are entitled thereto.
15. SETOFF.
Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any of
the Lenders to any of the Borrowers and any securities or other property of the
Borrowers in the possession of such Lender may be applied to or set off by such
Lender against the payment of Obligations and any and all other liabilities,
direct, or indirect, absolute or contingent, due or to become due, now existing
or hereafter arising, of the Borrowers to such Lender. Each of the Lenders
agrees with each other Lender that (i) if an amount to be set off is to be
applied to Indebtedness of a Borrower to such Lender, other than Indebtedness
evidenced by the Notes held by
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such Lender or constituting Reimbursement Obligations owed to such Lender, such
amount shall be applied ratably to such other Indebtedness and to the
Indebtedness evidenced by all such Notes held by such Lender or constituting
Reimbursement Obligations owed to such Lender, and (ii) if such Lender shall
receive from any of the Borrowers, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim evidenced
by the Notes held by, or constituting Reimbursement Obligations owed to, such
Lender by proceedings against any of the Borrowers at law or in equity or by
proof thereof in bankruptcy, reorganization, liquidation, receivership or
similar proceedings, or otherwise, and shall retain and apply to the payment of
the Note or Notes held by, or Reimbursement Obligations owed to, such Lender any
amount in excess of its ratable portion of the payments received by all of the
Lenders with respect to the Notes held by, and Reimbursement Obligations owed
to, all of the Lenders, such Lender will make such disposition and arrangements
with the other Lenders with respect to such excess, either by way of
distribution, pro tanto assignment of claims, subrogation or otherwise as shall
result in each Lender receiving in respect of the Notes held by it or
Reimbursement Obligations owed it, its proportionate payment as contemplated by
this Credit Agreement; provided that if all or any part of such excess payment
is thereafter recovered from such Lender, such disposition and arrangements
shall be rescinded and the amount restored to the extent of such recovery, but
without interest.
16. THE AGENT.
16.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of
each of the Lenders and to exercise all such powers as are hereunder
and under any of the other Loan Documents and any related documents
delegated to the Agent, together with such powers as are reasonably
incident thereto, provided that no duties or responsibilities not
expressly assumed herein or therein shall be implied to have been
assumed by the Agent.
(b) The relationship between the Agent and each of the Lenders
is that of an independent contractor. The use of the term "Agent" is
for convenience only and is used to describe, as a form of convention,
the independent contractual relationship between the Agent and each of
the Lenders. Nothing contained in this Credit Agreement nor the other
Loan Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Lenders.
(c) As an independent contractor empowered by the Lenders to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless
a "representative" of the Lenders, as that term is defined in Article 1
of the Uniform Commercial Code, for purposes of actions for the benefit
of the Lenders and the Agent with respect to all collateral security
and guaranties contemplated by the Loan Documents. Such actions include
the designation
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of the Agent as "secured party", "mortgagee" or the like on all
financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority
or enforcement of any security interests, mortgages or deeds of trust
in collateral security intended to secure the payment or performance of
any of the Obligations, all for the benefit of the Lenders and the
Agent.
16.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Credit Agreement and the other Loan Documents. The
Agent may utilize the services of such Persons as the Agent in its sole
discretion may reasonably determine, and all reasonable fees and expenses of any
such Persons shall be paid by the Borrowers. Without limiting the foregoing, the
Agent may appoint the Sterling Fronting Bank or any other financial institution
with an office located within the United Kingdom as its agent to exercise within
the United Kingdom, under the Agent's direction, any or all of the Agent's
rights and duties under this Credit Agreement and the other Loan Documents, and
the Agent may appoint the DM Fronting Bank or any other financial institution
with an office located within Germany as its agent to exercise within Germany,
under the Agent's direction, any or all of the Agent's rights and duties under
this Credit Agreement and the other Loan Documents. Any Fronting Bank or other
financial institution so appointed shall be entitled to the benefits of the
provisions of this Section 16 and Section 17 to the same extent, and subject to
the same limitations, as the Agent, for so long as such Fronting Bank or other
financial institution acts in such capacity.
16.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent or such other
Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
16.4. NO REPRESENTATIONS. The Agent shall not be responsible for the
execution or validity or enforceability of this Credit Agreement, the Notes, the
Letters of Credit, any of the other Loan Documents or any instrument at any time
constituting, or intended to constitute, collateral security for the Notes, or
for the value of any such collateral security or for the validity,
enforceability or collectability of any such amounts owing with respect to the
Notes, or for any recitals or statements, warranties or representations made
herein or in any of the other Loan Documents or in any certificate or instrument
hereafter furnished to it by or on behalf of the Borrowers or any of their
Subsidiaries, or be bound to ascertain or inquire as to the performance or
observance of any of the terms, conditions, covenants or agreements herein or in
any instrument at any time constituting, or intended to constitute, collateral
security for the Notes or to inspect
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any of the properties, books or records of the Borrowers or any of their
Subsidiaries. The Agent shall not be bound to ascertain whether any notice,
consent, waiver or request delivered to it by any of the Borrowers or any holder
of any of the Notes shall have been duly authorized or is true, accurate and
complete. The Agent has not made nor does it now make any representations or
warranties, express or implied, nor does it assume any liability to the Lenders,
with respect to the credit worthiness or financial conditions of the Borrowers
or any of their Subsidiaries. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender, and based
upon such information and documents as it has deemed appropriate, made its own
credit analysis and decision to enter into this Credit Agreement.
16.5. PAYMENTS.
16.5.1. PAYMENTS TO AGENT. A payment by any of the Borrowers
to the Agent hereunder or any of the other Loan Documents for the
account of any Lender shall constitute a payment to such Lender. The
Agent agrees promptly to distribute to each Lender such Lender's pro
rata share of payments received by the Agent for the account of the
Lenders except as otherwise expressly provided herein or in any of the
other Loan Documents.
16.5.2. DISTRIBUTION BY AGENT. If in the opinion of the Agent
the distribution of any amount received by it in such capacity
hereunder, under the Notes or under any of the other Loan Documents
might involve it in liability, it may refrain from making distribution
until its right to make distribution shall have been adjudicated by a
court of competent jurisdiction. If a court of competent jurisdiction
shall adjudge that any amount received and distributed by the Agent is
to be repaid, each Person to whom any such distribution shall have been
made shall either repay to the Agent its proportionate share of the
amount so adjudged to be repaid or shall pay over the same in such
manner and to such Persons as shall be determined by such court.
16.5.3. DELINQUENT LENDERS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Lender that fails (i) to make available to the Agent its
pro rata share of any Loan or to purchase any Letter of Credit
Participation, (ii) to make payment on the due date therefor of any
amount due to any of the Fronting Banks under Section 6.12.2, or (iii)
to comply with the provisions of Section 15 with respect to making
dispositions and arrangements with the other Lenders, where such
Lender's share of any payment received, whether by setoff or otherwise,
is in excess of its pro rata share of such payments due and payable to
all of the Lenders, in each case as, when and to the full extent
required by the provisions of this Credit Agreement, shall be deemed
delinquent (a "Delinquent Lender") and shall be deemed a Delinquent
Lender until such time as such delinquency is satisfied. A Delinquent
Lender shall be deemed to have assigned any and all payments due to it
from the Borrowers, whether on account of outstanding Loans, Unpaid
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Reimbursement Obligations, interest, fees or otherwise, to the
remaining nondelinquent Lenders for application to, and reduction of,
their respective pro rata shares of all outstanding Loans and Unpaid
Reimbursement Obligations. The Delinquent Lender hereby authorizes the
Agent to distribute such payments to the nondelinquent Lenders in
proportion to their respective pro rata shares of all outstanding Loans
and Unpaid Reimbursement Obligations. A Delinquent Lender shall be
deemed to have satisfied in full a delinquency when and if, as a result
of application of the assigned payments to all outstanding Loans and
Unpaid Reimbursement Obligations of the nondelinquent Lenders, the
Lenders' respective pro rata shares of all outstanding Loans and Unpaid
Reimbursement Obligations have returned to those in effect immediately
prior to such delinquency and without giving effect to the nonpayment
causing such delinquency.
16.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any
Note or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
16.7. INDEMNITY. The Lenders ratably agree hereby to indemnify and hold
harmless the Agent from and against any and all claims, actions and suits
(whether groundless or otherwise), losses, damages, costs, expenses (including
any expenses for which the Agent has not been reimbursed by the Borrowers as
required by Section 17), and liabilities of every nature and character arising
out of or related to this Credit Agreement, the Notes, or any of the other Loan
Documents or the transactions contemplated or evidenced hereby or thereby, or
the Agent's actions taken hereunder or thereunder, except to the extent that any
of the same shall be directly caused by the Agent's willful misconduct or gross
negligence.
16.8. AGENT AS LENDER. In its individual capacity, BankBoston shall
have the same obligations and the same rights, powers and privileges in respect
to its Revolving Credit Commitment and the Loans made by it, and as the holder
of any of the Notes and as the purchaser of any Letter of Credit Participations,
as it would have were it not also the Agent.
16.9. RESIGNATION OF AGENT. The Agent may resign at any time by giving
sixty (60) days prior written notice thereof to the Lenders and TransTechnology.
Upon any such resignation, the Majority Lenders shall have the right to appoint
a successor Agent. Unless a Default or Event of Default shall have occurred and
be continuing, such successor Agent shall be reasonably acceptable to
TransTechnology. If no successor Agent shall have been so appointed by the
Majority Lenders and shall have accepted such appointment within thirty (30)
days after the retiring Agent's giving of notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent, which
shall be a financial institution having a rating of not less than A or its
equivalent by Standard & Poor's Corporation. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become
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vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the provisions of this Credit
Agreement and the other Loan Documents shall continue in effect for its benefit
in respect of any actions taken or omitted to be taken by it while it was acting
as Agent.
17. EXPENSES.
The Borrowers jointly and severally (but, in the case of GmbH, subject
to Section 30 of the GmbH Act of Germany) agree to pay (i) the reasonable costs
of producing and reproducing this Credit Agreement, the other Loan Documents and
the other agreements and instruments mentioned herein, (ii) any taxes (including
any interest and penalties in respect thereto) payable by the Agent or any of
the Lenders (other than taxes based upon the Agent's or any Lender's net income)
on or with respect to the transactions contemplated by this Credit Agreement
(the Borrowers hereby agreeing to indemnify the Agent and each Lender with
respect thereto), (iii) the reasonable fees, expenses and disbursements of the
Agent's Special Counsel or any local counsel to the Agent incurred in connection
with the preparation, administration or interpretation of the Loan Documents and
other instruments mentioned herein, each closing hereunder, and amendments,
modifications, approvals, consents or waivers hereto or hereunder, (iv) the
fees, expenses and disbursements of the Agent incurred by the Agent in
connection with the preparation, administration or interpretation of the Loan
Documents and other instruments mentioned herein, including all title insurance
premiums, asset and/or collateral examiners' and commercial finance examiners'
fees and surveyor, engineering and appraisal charges, (v) any fees, costs,
expenses and bank charges, including bank charges for returned checks, incurred
by the Agent in establishing, maintaining or handling agency accounts, lock box
accounts and other accounts for the collection of any of the Collateral; (vi)
all reasonable out-of-pocket expenses (including without limitation reasonable
attorneys' fees and costs, which attorneys may be employees of any Lender or the
Agent, and reasonable consulting, accounting, appraisal, investment banking and
similar professional fees and charges) incurred by any Lender or the Agent in
connection with (A) the enforcement of or preservation of rights under any of
the Loan Documents against any of the Borrowers or their Subsidiaries or the
administration thereof after the occurrence of a Default or Event of Default and
(B) any litigation, proceeding or dispute whether arising hereunder or
otherwise, in any way related to any Lender's or the Agent's relationship with
any of the Borrowers or their Subsidiaries and (vii) all reasonable fees,
expenses and disbursements of any Lender or the Agent incurred in connection
with UCC searches, searches of registers of charges and commercial or companies
registers, UCC filings, mortgage recordings or other filings on recordings of
security documents evidencing the Agent's lien on the Collateral. The covenants
of this Section 17 shall survive payment or satisfaction of all other
Obligations.
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18. INDEMNIFICATION.
The Borrowers jointly and severally (but, in the case of GmbH, subject
to Section 30 of the GmbH Act of Germany) agree to indemnify and hold harmless
the Agent and the Lenders from and against any and all claims, actions and suits
whether groundless or otherwise, and from and against any and all liabilities,
losses, damages and expenses of every nature and character arising out of this
Credit Agreement or any of the other Loan Documents or the transactions
contemplated hereby including, without limitation, (i) any actual or proposed
use by any of the Borrowers or their Subsidiaries of the proceeds of any of the
Loans or Letters of Credit, (ii) the reversal or withdrawal of any provisional
credits granted by the Agent or any Lender upon the transfer of funds from bank
agency or lock box accounts or in connection with the provisional honoring of
checks or other items, (iii) any actual or alleged infringement of any patent,
copyright, trademark, service xxxx or similar right of any of the Borrowers or
their Subsidiaries comprised in the Collateral, (iv) any of the Borrowers or
their Subsidiaries entering into or performing this Credit Agreement or any of
the other Loan Documents or (v) with respect to the Borrowers and their
Subsidiaries and their respective properties and assets, the violation of any
Environmental Law, the presence, disposal, escape, seepage, leakage, spillage,
discharge, emission, release or threatened release of any Hazardous Substances
or any action, suit, proceeding or investigation brought or threatened with
respect to any Hazardous Substances (including, but not limited to, claims with
respect to wrongful death, personal injury or damage to property), in each case
including, without limitation, the reasonable fees and disbursements of counsel
and allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding. In litigation, or the preparation
therefor, the Lenders and the Agent shall be entitled to select their own
counsel and, in addition to the foregoing indemnity, the Borrowers jointly and
severally agree to pay promptly the reasonable fees and expenses of such
counsel. If, and to the extent that the obligations of the Borrowers under this
Section 18 are unenforceable for any reason, the Borrowers hereby jointly and
severally agree to make the maximum contribution to the payment in satisfaction
of such obligations which is permissible under applicable law. The covenants
contained in this Section 18 shall survive payment or satisfaction in full of
all other Obligations.
19. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein,
in the Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of any of the Borrowers or their Subsidiaries
pursuant hereto shall be deemed to have been relied upon by the Lenders and the
Agent, notwithstanding any investigation heretofore or hereafter made by any of
them, and shall survive the making by any of the Lenders of any of the Loans and
the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as any Letter
of Credit or any amount due under this Credit Agreement or the Notes or any of
the other Loan Documents remains outstanding or any Lender has any obligation to
make any Loans or the Issuing Bank has any obligation to issue, extend or renew
any Letter of Credit, and
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for such further time as may be otherwise expressly specified in this Credit
Agreement. All statements contained in any certificate or other paper delivered
to any Lender or the Agent at any time by or on behalf of TransTechnology or any
of its Subsidiaries pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by
TransTechnology or such Subsidiary hereunder.
20. ASSIGNMENT AND PARTICIPATION.
20.1. CONDITIONS TO ASSIGNMENT. Except as provided herein, each Lender
may assign to one or more Eligible Assignees all or a portion of its interests,
rights and obligations as a Lender under this Credit Agreement (including all or
a portion of its Revolving Credit Commitment Percentage and Revolving Credit
Commitment and the same portion of the Revolving Credit Loans at the time owing
to it, the Revolving Credit Notes held by it and the same portion of its
participating interest in the risk relating to any Letters of Credit or Fronted
Loans); provided that (i) each of the Agent and, so long as no Default or Event
of Default shall have occurred and be continuing, TransTechnology, shall have
given its prior written consent to such assignment (such consent not to be
unreasonably withheld), provided, further, however, that no such consent shall
be required for any assignment to a Lender or an Affiliate of a Lender, (ii)
each such assignment shall be of a constant, and not a varying, percentage of
all the assigning Lender's rights and obligations as a Lender under this Credit
Agreement, (iii) each assignment shall be in an amount that is at least
$10,000,000 or a greater multiple of $5,000,000, and (iv) the parties to such
assignment shall execute and deliver to the Agent, for recording in the Register
(as hereinafter defined), an Assignment and Acceptance, substantially in the
form of Exhibit D hereto (an "Assignment and Acceptance"), together with any
Revolving Credit Notes subject to such assignment. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in any such Assignment and Acceptance, which effective date shall be at least
five (5) Business Days after the execution thereof, (i) the assignee thereunder
shall be a party hereto and, to the extent provided in such Assignment and
Acceptance, have the rights and obligations of a Bank hereunder, and (ii) the
assigning Bank shall, to the extent provided in such assignment and upon payment
to the Agent of the registration fee referred to in Section 20.3, be released
from its obligations under this Credit Agreement.
20.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS; COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to the
assignment thereunder confirm to and agree with each other and the other parties
hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Lender makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan
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Documents or any other instrument or document furnished pursuant hereto
or the attachment, perfection or priority of any security interest or
mortgage,
(b) the assigning Lender makes no representation or warranty
and assumes no responsibility with respect to the financial condition
of TransTechnology and its Subsidiaries or any other Person primarily
or secondarily liable in respect of any of the Obligations, or the
performance or observance by any of the Borrowers and their
Subsidiaries or any other Person primarily or secondarily liable in
respect of any of the Obligations of any of their obligations under
this Credit Agreement or any of the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in Section 8.4 and Section 9.4 and such other
documents and information as it has deemed appropriate to make its own
credit analysis and decision to enter into such Assignment and
Acceptance;
(d) such assignee will, independently and without reliance
upon the assigning Lender, the Agent or any other Lender and based on
such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking
action under this Credit Agreement;
(e) such assignee represents and warrants that it is an
Eligible Assignee;
(f) such assignee appoints and authorizes the Agent to take
such action as agent on its behalf and to exercise such powers under
this Credit Agreement and the other Loan Documents as are delegated to
the Agent by the terms hereof or thereof, together with such powers as
are reasonably incidental thereto;
(g) such assignee agrees that it will perform in accordance
with their terms all of the obligations that by the terms of this
Credit Agreement are required to be performed by it as a Lender;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements
with the assigning Lender satisfactory to such assignee with respect to
its pro rata share of Letter of Credit Fees in respect of outstanding
Letters of Credit.
20.3. REGISTER. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the
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recordation of (a) the names and addresses of the Lenders, and (b) the Revolving
Credit Commitment Percentages and the principal amounts of the Revolving Credit
Loans owing to, and the Letter of Credit Participations and participations in
the risk related to the Fronted Loans purchased by, the Lenders from time to
time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Credit Agreement. The Register shall be available for
inspection by the Borrowers and the Lenders at any reasonable time and from time
to time upon reasonable prior notice. Upon each such recordation, other than the
recordations of transfers from the original Lender, the assigning Lender agrees
to pay to the Agent a registration fee in the sum of $3,500.
20.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein in
the Register, and (ii) give prompt notice thereof to TransTechnology and the
Lenders (other than the assigning Lender). Within five (5) Business Days after
receipt of such notice, TransTechnology, at its own expense, shall execute and
deliver to the Agent in exchange for each surrendered Note, a new Note to the
order of such Eligible Assignee in an amount equal to the amount assumed by such
Eligible Assignee pursuant to such Assignment and Acceptance and, if the
assigning Lender has retained some portion of its obligations hereunder, a new
Note or Notes to the order of the assigning Lender in an amount equal to the
amount retained by it hereunder as a Lender. Such new Notes shall provide that
they are replacements for the surrendered Notes, shall be in an aggregate
principal amount equal to the aggregate principal amount of the surrendered
Notes, shall be dated the effective date of such in Assignment and Acceptance
and shall otherwise be substantially the form of the assigned Notes. Upon the
request of the recipient of new Notes or the Agent, within five (5) days of
issuance of such new Notes pursuant to this Section 20.4, TransTechnology shall
deliver an opinion of counsel, which may be the general counsel of
TransTechnology, addressed to the recipients of the new Notes and the Agent,
relating to the due authorization, execution and delivery of such new Notes and
the legality, validity and binding effect thereof, in form and substance
satisfactory to the recipients of the new Notes, the Agent and the Agent's
Special Counsel. The surrendered Notes shall be cancelled and returned to
TransTechnology.
20.5. PARTICIPATIONS. Each Lender may sell participations to one or
more banks or other entities in all or a portion of such Lender's rights and
obligations under this Credit Agreement and the other Loan Documents; provided
that (i) each such participation shall be in an amount of not less than
$1,000,000, (ii) any such sale or participation shall not affect the rights and
duties of the selling Lender hereunder to the Borrowers, and (iii) the only
rights granted to the participant pursuant to such participation arrangements
with respect to waivers, amendments or modifications of the Loan Documents shall
be the rights to approve waivers, amendments or modifications that would reduce
the principal of or the interest rate on any Loans, extend the term or increase
the amount of any of the Commitments of
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such Lender as it relates to such participant, reduce the amount of any
commitment fees or Letter of Credit Fees to which such participant is entitled
or extend any regularly scheduled payment date for principal or interest.
20.6. DISCLOSURE. The Borrowers agree that in addition to disclosures
made in accordance with standard and customary banking practices any Lender may
disclose information obtained by such Lender pursuant to this Credit Agreement
to assignees or participants and potential assignees or participants hereunder;
provided that such assignees or participants or potential assignees or
participants shall agree (i) to treat in confidence such information unless such
information otherwise becomes public knowledge, (ii) not to disclose such
information to a third party, except as required by law or legal process and
(iii) not to make use of such information for purposes of transactions unrelated
to such contemplated assignment or participation.
20.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH TRANSTECHNOLOGY.
If any assignee Lender is an Affiliate of TransTechnology, then any
such assignee Lender shall have no right to vote as a Lender hereunder or under
any of the other Loan Documents for purposes of granting consents or waivers or
for purposes of agreeing to amendments or other modifications to any of the Loan
Documents or for purposes of making requests to the Agent pursuant to Section
14.1 or Section 14.2, and the determination of the Majority Lenders shall for
all purposes of this Credit Agreement and the other Loan Documents be made
without regard to such assignee Lender's interest in any of the Loans. If any
Lender sells a participating interest in any of the Loans or Reimbursement
Obligations to a participant, and such participant is TransTechnology or an
Affiliate of TransTechnology, then such transferor Lender shall promptly notify
the Agent of the sale of such participation. A transferor Lender shall have no
right to vote as a Lender hereunder or under any of the other Loan Documents for
purposes of granting consents or waivers or for purposes of agreeing to
amendments or modifications to any of the Loan Documents or for purposes of
making requests to the Agent pursuant to Section 14.1 or Section 14.2 to the
extent that such participation is beneficially owned by TransTechnology or any
Affiliate of TransTechnology, and the determination of the Majority Lenders
shall for all purposes of this Credit Agreement and the other Loan Documents be
made without regard to the interest of such transferor Lender in the Loans to
the extent of such participation.
20.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Lender shall
retain its rights to be indemnified pursuant to Section 17 with respect to any
claims or actions arising prior to the date of such assignment. If any assignee
Lender is not incorporated under the laws of the United States of America or any
state thereof, it shall, prior to the date on which any interest or fees are
payable hereunder or under any of the other Loan Documents for its account,
deliver to TransTechnology and the Agent certification as to its exemption from
deduction or withholding of any United States federal income taxes. If the
Reference Bank transfers all of its interest, rights and obligations under this
Credit Agreement, the Agent shall, in consultation with TransTechnology and with
the consent of
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TransTechnology and the Majority Lenders, appoint another Lender to act as the
Reference Bank hereunder, and in the absence of such consent the Agent shall act
as Reference Bank. Anything contained in this Section 20 to the contrary
notwithstanding, any Lender may at any time pledge all or any portion of its
interest and rights under this Credit Agreement (including all or any portion of
its Notes) to any of the twelve Federal Reserve Banks organized under Section 4
of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or the
enforcement thereof shall release the pledgor Lender from its obligations
hereunder or under any of the other Loan Documents.
20.9. ASSIGNMENT BY THE BORROWERS. None of the Borrowers shall assign
or transfer any of its rights or obligations under any of the Loan Documents,
without the prior written consent of each of the Lenders.
20.10. SYNDICATION. The Borrowers shall provide all information
reasonably requested by the Arranger in form and substance reasonably
satisfactory to the Arranger to complete the syndication of BankBoston's initial
Commitment, including, without limitation, all information that is reasonably
available and all projections prepared by or on behalf of the Borrowers relating
to the transactions contemplated hereby. The Borrowers and their respective
directors, officers, employees and agents shall, at the reasonable request of
the Arranger meet with potential Lenders and provide such additional information
as such Persons might reasonably request. The Borrowers agree that the option to
borrow Eurodollar Rate Loans under the loan facilities set forth herein prior to
completion of the syndication of BankBoston's initial Commitment is subject to
the provisions of the second sentence of Section 6.13.
21. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail or, if either the Person giving the notice or the
Person being notified is outside the United States, by registered or
recorded-delivery air mail, in each case postage prepaid, sent by overnight
courier, or sent by telegraph, telecopy, facsimile or telex and confirmed by
delivery via courier or postal service, addressed as follows:
(a) if to any of the Borrowers, at TransTechnology
Corporation, 000 Xxxxx Xxxx, Xxxxxxx Xxxxxx, Xxx Xxxxxx 00000, U.S.A.,
Attention: Xxxxxx X. Xxxxxx, Esq., Vice President, Secretary and
General Counsel, or at such other address for notice as TransTechnology
shall last have furnished in writing to the Person giving the notice;
(b) if to the Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, XXX, Attention: Xxxxx X. Xxxxxxxxx, Vice
President, or such other address for notice as the Agent shall last
have furnished in writing to the Person giving the notice;
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(c) if to any Lender or Fronting Bank, at such Lender's or
Fronting Bank's address set forth on Schedule 1 hereto, or such other
address for notice as such Lender or Fronting Bank shall have last
furnished in writing to the Person giving the notice; and
Any such notice or demand shall be deemed to have been duly given or
made and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile,
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof, and (iii) if sent by
registered or recorded-delivery air mail, on the fifth Business Day following
the mailing thereof.
22. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH OF MASSACHUSETTS
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWERS
AGREE THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND EACH OF THE BORROWERS
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS
IN ANY SUCH SUIT BEING MADE UPON IT BY MAIL AT THE ADDRESS SPECIFIED IN
Section 21. IN ADDITION, ANY SUIT OR OTHER REMEDY UNDER ANY OF THE SECURITY
DOCUMENTS MAY BE BROUGHT IN THE JURISDICTION IN WHICH THE RESPECTIVE COLLATERAL
OR MORTGAGED PROPERTY THEREUNDER IS LOCATED. EACH OF GMBH AND LIMITED HEREBY
EXPRESSLY APPOINTS TRANSTECHNOLOGY AT THE ADDRESS SPECIFIED IN Section 21 AS ITS
AGENT FOR SERVICE OF PROCESS. EACH OF THE BORROWERS HEREBY WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH
COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
23. HEADINGS.
The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.
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24. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in
several counterparts and by each party on a separate counterpart, each of which
when executed and delivered shall be an original, and all of which together
shall constitute one instrument. In proving this Credit Agreement it shall not
be necessary to produce or account for more than one such counterpart signed by
the party against whom enforcement is sought.
25. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in Section 27.
26. WAIVER OF JURY TRIAL.
Each of the Borrowers hereby waives its right to a jury trial with
respect to any action or claim arising out of any dispute in connection with
this Credit Agreement, the Notes or any of the other Loan Documents, any rights
or obligations hereunder or thereunder or the performance of which rights and
obligations. Except as prohibited by law, each of the Borrowers hereby waives
any right it may have to claim or recover in any litigation referred to in the
preceding sentence any special, exemplary, punitive or consequential damages or
any damages other than, or in addition to, actual damages. Each of the Borrowers
(i) certifies that no representative, agent or attorney of any Lender or the
Agent has represented, expressly or otherwise, that such Lender or the Agent
would not, in the event of litigation, seek to enforce the foregoing waivers and
(ii) acknowledges that each of the Agent and the Lenders has been induced to
enter into this Credit Agreement, the other Loan Documents to which it is a
party by, among other things, the waivers and certifications contained herein.
27. CONSENTS, AMENDMENTS, WAIVERS, ETC.
27.1. VOTING PROCEDURES.
(a) Except as set forth in clauses (b) - (f) below, any term, covenant,
agreement or condition of this Agreement or any of the Loan Documents may be
amended or waived and any departure therefrom may be consented to by the
Majority Lenders if, but only if, such amendment, waiver or consent is in
writing signed by the Majority Lenders and, in the case of an amendment (other
than an amendment described in Section 27.2), by the Borrowers and, in any such
event, the failure to observe, perform or discharge any such term, covenant,
agreement or condition (whether such amendment is executed or such waiver or
consent is given before or after such failure) shall not be construed as a
breach of such term, covenant, agreement or condition or as a Default or an
Event of Default. Unless otherwise
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specified in such waiver or consent, a waiver or consent given hereunder shall
be effective only in the specific instance and for the specific purpose for
which given. Anything herein to the contrary notwithstanding, the Majority
Lenders shall have the right to waive any Default or Event of Default and the
consequences hereunder of such Default or Event of Default and shall have the
right to enter into an agreement with the Borrowers providing for the
forbearance from the exercise of any remedies provided hereunder or under the
other Loan Documents without waiving any Default or Event of Default. The making
of Loans hereunder by the Lenders during the existence of a Default or Event of
Default shall not be deemed to constitute a waiver of such Default or Event of
Default.
(b) Except as otherwise set forth in this Agreement, without the prior
unanimous written consent of the Lenders, no amendment, consent or waiver shall
affect the amount or extend the time of the obligation of the Lenders to make
Revolving Credit Loans or extend the originally scheduled time or times of
payment of the principal of any such Loan or alter the time or times of payment
of interest on any such Loan or the amount of the principal thereof or the rate
of interest thereon or the amount of any revolving credit commitment fee payable
hereunder or permit any subordination of the principal or interest on any such
Loan.
(c) Except as otherwise set forth in this Agreement, without the prior
unanimous written consent of the Lenders and the Fronting Banks, no amendment,
consent or waiver shall affect the amount or extend the time of the obligation
of the Fronting Banks to make International Facility Loans or extend the
originally scheduled time or times of payment of the principal of any such Loan
or alter the time or times of payment of interest on any such Loan or the amount
of the principal thereof or the rate of interest thereon or the amount of the
fronting fee referred to in Section 6.12.1 or permit any subordination of the
principal or interest on any such Loan or alter the apportionment of any
repayments or prepayment of any such Loans to which a Fronting Bank is entitled.
(d) Except as otherwise set forth in this Agreement, (i) without the
prior written consent of the Issuing Bank, no amendment, consent or waiver shall
affect the rights or duties of the Issuing Bank, including without limitation
the amount of any Letter of Credit Fees payable hereunder, (ii) without the
prior written consent of a Fronting Bank, no amendment, consent or waiver shall
affect the rights or duties of such Fronting Bank, including without limitation
the amount of any fronting fees payable hereunder and (iii) without the prior
written consent of the Agent, no amendment, consent or waiver shall affect the
right or duties of the Agent, including without limitation the amount of any
Agent's fees payable hereunder or the provisions of Section 16.
(e) No portion of the Collateral with a book value at the time of such
release which, when aggregated with the book value of all other portions of the
Collateral released by the Agent in any fiscal year without the prior unanimous
consent of the Lenders pursuant to this Section 27.1(e), exceeds $1,000,000,
shall be released by the Agent, other than as specifically permitted by this
Agreement or in the other Loan Documents, without the prior unanimous written
consent of the
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Lenders for such release, provided, however, that any other release of
Collateral may be agreed to by the Agent alone, unless specifically prohibited
by this Agreement or any of the other Loan Agreements.
(f) Neither the definition of "Majority Lenders", nor the provisions of
this Section 27.1, may be amended without the prior unanimous written consent of
the Lenders.
27.2. BORROWERS' CONSENT NOT REQUIRED FOR CERTAIN AMENDMENTS.
Notwithstanding any provision of this Agreement or the other Loan Documents to
the contrary, no consent, written or otherwise, of the Borrowers shall be
necessary or required in connection with any amendment to Section 6.12.2 or
Section 16 and any amendment to such provisions shall be effected solely by and
among the Agent, the Fronting Banks and the Lenders (with respect to any
amendment to Section 6.12.2) or the Agent and the Lenders (with respect to any
amendment of Section 16), provided that no such amendment shall impose any
obligation on the Borrowers.
27.3. COURSE OF DEALING. No course of dealing or delay or omission on
the part of the Agent or any Lender in exercising any right shall operate as a
waiver thereof or otherwise be prejudicial thereto. No notice to or demand upon
any of the Borrowers shall entitle any of the Borrowers to other or further
notice or demand in similar or other circumstances.
28. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in whole or in
part in any jurisdiction, then such invalidity or unenforceability shall affect
only such clause or provision, or part thereof, in such jurisdiction, and shall
not in any manner affect such clause or provision in any other jurisdiction, or
any other clause or provision of this Credit Agreement in any jurisdiction.
29. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
29.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY.
TransTechnology acknowledges that from time to time financial advisory,
investment banking and other services may be offered or provided to
TransTechnology or one or more of its Subsidiaries, in connection with this
Credit Agreement or otherwise, by a Section 20 Subsidiary. TransTechnology, for
itself and each of its Subsidiaries, hereby authorizes (a) such Section 20
Subsidiary to share with the Agent and each Lender any information delivered to
such Section 20 Subsidiary by TransTechnology or any of its Subsidiaries, and
(b) the Agent and each Lender to share with such Section 20 Subsidiary any
information delivered to the Agent or such Lender by TransTechnology or any of
its Subsidiaries pursuant to this Credit Agreement, or in connection with the
decision of such Lender to enter into this Credit Agreement; it being
understood, in each case, that any such Section 20 Subsidiary receiving such
information shall be bound by the confidentiality
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provisions of this Credit Agreement. Such authorization shall survive the
payment and satisfaction in full of all of Obligations.
29.2. CONFIDENTIALITY. Each of the Lenders and the Agent agrees, on
behalf of itself and each of its affiliates, directors, officers, employees and
representatives, to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by TransTechnology or any of its
Subsidiaries pursuant to this Credit Agreement that is identified by such Person
as being confidential at the time the same is delivered to any of the Lenders or
the Agent, provided that nothing herein shall limit the disclosure of any such
information (a) after such information shall have become public other than
through a violation of this Section 29, (b) to the extent required by statute,
rule, regulation or judicial process, (c) to counsel, auditors or accounts for
any of the Lenders or the Agent, (d) to bank examiners or any other regulatory
authority having jurisdiction over any of the Lenders or the Agent, (e) to the
Agent, any Lender or any Section 20 Subsidiary, (f) in connection with any
litigation to which any one or more of the Lenders, the Agent or any Section 20
Subsidiary is a party, or in connection with the enforcement of rights or
remedies hereunder or under any other Loan Document, (g) to a Subsidiary or
affiliate of such Lender as provided in Section 29.1 or (h) to any assignee or
participant (or prospective assignee or participant) so long as such assignee or
participant agrees to be bound by the provisions of Section 20.6.
29.3. PRIOR NOTIFICATION. Unless specifically prohibited by applicable
law or court order, each of the Lenders and the Agent shall, prior to disclosure
thereof, notify TransTechnology of any request for disclosure of any such
non-public information by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of such Lender or the Agent by such governmental agency) or pursuant
to legal process, and shall consult with TransTechnology on the advisability of
taking legally available steps to resist or narrow any such request. In the
event that such steps are not available or effective, or are deemed inadvisable
by counsel to such Lender or the Agent, as the case may be, or in the event that
TransTechnology waives compliance with the provisions of this Section 29.3, such
Lender or the Agent, and/or its respective representatives, as the case may be,
may disclose to any tribunal only that portion of such non-public information
which it is advised by counsel is legally required to be disclosed, and shall
exercise reasonable efforts to obtain assurances that confidential treatment
will be accorded such non-public information.
29.4. OTHER. In no event shall any Lender or the Agent be obligated or
required to return any materials furnished to it or any Section 20 Subsidiary by
TransTechnology or any of its Subsidiaries which such Lender, Section 20
Subsidiary or Agent is required to retain pursuant to any requirement of law or
rule or regulation of any governmental agency. The obligations of each Lender
under this Section 29 shall supersede and replace the obligations of such Lender
under any confidentiality letter in respect of this financing signed and
delivered by such Lender to TransTechnology prior to the date hereof and shall
be binding upon any
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assignee of, or purchaser of any participation in, any interest in any of the
Loans or Reimbursement Obligations from any Lender.
30. TRANSITIONAL ARRANGEMENTS.
30.1. ORIGINAL CREDIT AGREEMENT SUPERSEDED. This Credit Agreement shall
on the Closing Date amend and restate the Original Credit Agreement in its
entirety, except as provided in this Section 30. On the Closing Date, the rights
and obligations of the parties evidenced by the Original Credit Agreement shall
be evidenced by the Credit Agreement and the other Loan Documents, as defined
herein, and the Loans as defined in the Original Credit Agreement, collectively,
shall be converted to the Loans as defined herein.
30.2. INTEREST AND FEES UNDER SUPERSEDED AGREEMENT. All interest and
fees and expenses, if any, owing or accruing under or in respect of the Original
Credit Agreement through the Closing Date shall be calculated as of the Closing
Date (prorated in the case of any fractional periods), and shall be paid in
accordance with the method, for the periods, and on the dates, specified in the
Original Credit Agreement, as if the Original Credit Agreement were still in
effect. Commencing on the Closing Date, the commitment fee shall be payable by
the Borrowers to the Agent for the account of the Lenders in accordance with
Section 2.2.
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IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
TRANSTECHNOLOGY CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Vice President, Chief Financial
Officer and Treasurer
TRANSTECHNOLOGY XXXXXX-ORBIS GMBH
By: /s/ Ulf Jemsby
---------------------------------------
Name: Ulf Jemsby
Title: Managing Director
XXXXXXXX INTERNATIONAL
LIMITED
By: /s/ Ulf Jemsby
---------------------------------------
Name: Ulf Jemsby
Title: Managing Director
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Director
BANKBOSTON, N.A., individually and as
Agent, Issuing Bank and Sterling Fronting
Bank
By: /s/ Xxxxx Xxxxxxxxx
---------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
000
-0-
XXX-XXXX AKTIENGESELLSCHAFT,
as DM Fronting Bank
By: /s/ Xxxxxxx Xxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Vice President
By: /s/ Xxxxxxx Xxxxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Assistant Treasurer
ABN AMRO BANK N.V.
By: /s/ Xxxx Megeaski
---------------------------------------
Name: Xxxx Megeaski
Title: Vice President
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Corporate Banking Officer
THE FIRST NATIONAL
BANK OF CHICAGO
By: /s/ Xxxx X. Xxxxxx
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
000
XXX XXXX XX XXX XXXX
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
SUMMIT BANK
By: /s/ Xxxxx X. Xxxx
---------------------------------------
Name: Xxxxx X. Xxxx
Title: Vice President
Large Corporate Group
Summit Bank
