Loan Agreement PNC BANK
THIS LOAN AGREEMENT (the "Agreement"), is entered into as of September 19,
1999, among ACRODYNE COMMUNICATIONS, INC., a Delaware corporation, and ACRODYNE
INDUSTRIES, INC., a Pennsylvania corporation (together, the "Borrower"), and PNC
BANK, NATIONAL ASSOCIATION (the "Bank").
The Borrower and the Bank, with the intent to be legally bound, agree as
follows:
1. Loan. The Bank has made or may make one or more loans (collectively, the
"Loan") to the Borrower subject to the terms and conditions and upon the
representations and warranties of the Borrower set forth in this Agreement. The
Loan is or will be evidenced by a promissory note or notes of the Borrower and
all renewals, extensions, amendments and restatements thereof (if one or more,
collectively, the "Note") acceptable to the Bank, which shall set forth the
interest rate, repayment and other provisions, the terms of which are
incorporated into this Agreement by reference.
2. Security. The security for repayment of the Loan shall include but not
be limited to the collateral, guaranties and other documents heretofore,
contemporaneously or hereafter executed and delivered to the Bank (the "Security
Documents"), which shall secure repayment of the Loan, the Note and all other
loans, advances, debts, liabilities, obligations, covenants and duties owing by
the Borrower to the Bank or to any other direct or indirect subsidiary of PNC
Bank Corp., of any kind or nature, present or future (including any interest
accruing thereon after maturity, or after the filing of any petition in
bankruptcy, or the commencement of any insolvency, reorganization or like
proceeding relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding), whether or not evidenced
by any note, guaranty or other instrument, whether arising under any agreement,
instrument or document whether or not for the payment of money, whether arising
by reason of an extension of credit, opening of a letter of credit, loan,
equipment lease or guarantee, under any interest or currency swap, future,
option or other interest rate protection or similar agreement, or in any other
manner, whether arising out of overdrafts on deposit or other accounts or
electronic funds transfers (whether through automated clearing houses or
otherwise) or out of the Bank's non-receipt of or inability to collect funds or
otherwise not being made whole in connection with depository transfer check or
other similar arrangements, whether direct or indirect (including those acquired
by assignment or participation), absolute or contingent, joint or several, due
or to become due, now existing or hereafter arising, and any amendments,
extensions, renewals or increases and all costs and expenses of the Bank
incurred in the documentation, negotiation, modification, enforcement,
collection or otherwise in connection with any of the foregoing, including
reasonable attorneys' fees and expenses (hereinafter referred to collectively as
the "Obligations"). Unless expressly provided to the contrary in documentation
for any other loan or loans, it is the express intent of the Bank and the
Borrower that all Obligations including those included in the Loan be
cross-collateralized and cross-defaulted, such that collateral securing any of
the Obligations shall secure repayment of all Obligations and a default under
any Obligation shall be a default under all Obligations.
This Agreement, the Note and the Security Documents are collectively
referred to as the "Loan Documents." Capitalized terms not defined herein shall
have the meanings ascribed to them in the Loan Documents.
3. Representations and Warranties. The Borrower hereby makes the following
representations and warranties, which shall be continuing in nature and remain
in full force and effect until the Obligations are paid in full, and which shall
be true and correct except as otherwise set forth on the Addendum attached
hereto and incorporated herein by reference (the "Addendum"):
3.1. Existence, Power and Authority. If not a natural person, the
Borrower is duly organized, validly existing and in good standing under the laws
of the State of its incorporation or organization and has the power and
authority to own and operate its assets and to conduct its business as now or
proposed to be carried on, and is duly qualified, licensed and in good standing
to do business in all jurisdictions where its ownership of property or the
nature of its business requires such qualification or licensing. The Borrower is
duly authorized to execute and deliver the Loan Documents, all necessary action
to authorize the execution and delivery of the Loan Documents has been properly
taken, and the Borrower is and will continue to be duly authorized to borrow
under this Agreement and to perform all of the other terms and provisions of the
Loan Documents.
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3.2. Financial Statements. If the Borrower is not a natural person, it has
delivered or caused to be delivered its most recent balance sheet, income
statement and statement of cash flows, or if the Borrower is a natural person,
its personal financial statement and tax returns (as applicable, the "Historical
Financial Statements"). Thee Historical Financial Statements are true, complete
and accurate in all material respects and fairly present the financial
condition, assets and liabilities, whether accrued, absolute, contingent or
otherwise and the results of the Borrower's operations for the period specified
therein. The Historical Financial Statements have been prepared in accordance
with generally accepted accounting principles ("GAAP") consistently applied from
period to period subject in the case of interim statements to normal year-end
adjustments and to any comments and notes acceptable to the Bank in its sole
discretion.
3.3. No Material Adverse Change. Since the date of the most recent
Financial Statements, the Borrower has not suffered any damage, destruction or
loss, and no event or condition has occurred or exists, which has resulted or
could result in a material adverse change in its business, assets, operations,
financial condition or results of operation.
3.4. Binding Obligations. The Borrower has full power and authority to
enter into the transactions provided for in this Agreement and has been duly
authorized to do so by appropriate action of its Board of Directors if the
Borrower is a corporation, all its general partners if the Borrower is a
partnership or otherwise as may be required by law, charter, other
organizational documents or agreements; and the Loan Documents, when executed
and delivered by the Borrower, will constitute the legal, valid and binding
obligations of the Borrower enforceable in accordance with their terms.
3.5. No Defaults or Violations. There does not exist any Event of
Default under this Agreement or any default or violation by the Borrower of or
under any of the terms, conditions or obligations of: (i) its partnership
agreement if the Borrower is a partnership, its articles or certificate of
incorporation, regulations or bylaws if the Borrower is a corporation or its
other organizational documents as applicable; (ii) any indenture, mortgage, deed
of trust, franchise, permit, contract, agreement, or other instrument to which
it is a party of by which it is bound; or (iii) any law, regulation, ruling,
order, injunction, decree, condition or other requirement applicable to or
imposed upon it by any law, the action by any court or any governmental
authority or agency; and the consummation of this Agreement and the transactions
set forth herein will not result in any such default or violation.
3.6. Title to Assets. The Borrower has good and marketable title to
the assets reflected on the most recent Financial Statements, free and clear of
all liens and encumbrances, except for (i) current taxes and assessments not yet
due and payable, (ii) assets disposed of by the Borrower in the ordinary course
of business since the date of the most recent Financial Statements, and (iii)
those liens or encumbrances, if any, specified on the Addendum.
3.7. Litigation. There are no actions, suits, proceedings or
governmental investigations pending or, to the knowledge of the Borrower,
threatened against the Borrower, which could result in a material adverse change
in its business, assets, operations, financial condition or results of
operations and there is no basis known to the Borrower for any action, suit,
proceeding or investigation which could result in such a material adverse
change. All pending or threatened litigation against the Borrower is listed on
the Addendum.
3.8. Tax Returns. The Borrower has filed all returns and reports that
are required to be filed by it in connection with any federal, state or local
tax, duty or charge levied, assessed or imposed upon it or its property or
withheld by it, including unemployment, social security and similar taxes, and
all of such taxes have been either paid or adequate reserve or other provision
has been made therefor.
3.9. Employee Benefit Plans. Each employee benefit plan as to which
the Borrower may have any liability complies in all material respects with all
applicable provisions of the Employee Retirement Income Security Act of 1974
("ERISA"), including minimum funding requirements, and (i) no Prohibited
Transaction (as defined under ERISA) has occurred with respect to any such plan,
(ii) no Reportable Event (as defined under Section 4043 of ERISA) has occurred
with respect to any such plan which would cause the Pension Benefit Guaranty
Corporation to institute proceedings under Section 4042 of ERISA, (iii) the
Borrower has not withdrawn from any such plan or initiated steps to do so, and
(iv) no steps have been taken to terminate any such plan.
3.10. Environmental Matters. The Borrower is in compliance, in all
material respects, with all Environmental Laws, including, without limitation,
all Environmental Laws in jurisdictions in which the Borrower owns or operates,
or has owned or operated, a facility or site, stores Collateral, arranges or has
arranged for disposal or treatment of hazardous substances, solid waste or other
waste, accepts or has accepted for transport any hazardous
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substances, solid waste or other wastes or holds or has held any interest in
real property or otherwise. Except as otherwise disclosed on the Addendum, no
litigation or proceeding arising under, relating to or in connection with any
Environmental Law is pending or, to the best of the Borrower's knowledge,
threatened against the Borrower, any real property which the Borrower holds or
has held an interest or any past or present operation of the Borrower. No
release, threatened release or disposal of hazardous waste, solid waste or other
wastes is occurring, or to the best of the Borrower's knowledge has occurred,
on, under or to any real property in which the Borrower holds any interest or
performs any of its operations, in violation of any Environmental Law. As used
in this Section, "litigation or proceeding" means any demand, claim notice,
suit, suit in equity, action, administrative action, investigation or inquiry
whether brought by a governmental authority or other person, and "Environmental
Laws" means all provisions of laws, statutes, ordinances, rules, regulations,
permits, licenses, judgments, writs, injunctions, decrees, orders, awards and
standards promulgated by any governmental authority concerning health, safety
and protection of, or regulation of the discharge of substances into, the
environment.
3.11. Intellectual Property. The Borrower owns or is licensed to use
all patents, patent rights, trademarks, trade names, service marks, copyrights,
intellectual property, technology, know-how and processes necessary for the
conduct of its business as currently conducted that are material to the
condition (financial or otherwise), business or operations of the Borrower.
3.12. Regulatory Matters. No part of the proceeds of the Loan will be
used for "purchasing" or carrying any "margin stock" within the respective
meanings of each of the quoted terms under Regulation U of the Board of
Governors of the Federal Reserve System as now and from time to time in effect
or for any purpose which violates the provisions of the Regulations of such
Board of Governors.
3.13. Solvency. As of the date hereof and after giving effect to the
transactions contemplated by the Loan Documents, (i) the aggregate value of the
Borrower's assets will exceed its liabilities (including contingent,
subordinated, unmatured and unliquidated liabilities), (ii) the Borrower will
have sufficient cash flow to enable it to pay its debts as they mature, and
(iii) the Borrower will not have unreasonably small capital for the business in
which it is engaged.
3.14. Year 2000, The Borrower has reviewed the areas within its
business and operations which could be adversely affected by, and has developed
or is developing a program to address on a timely basis the risk that certain
computer applications used by the Borrower may be unable to recognize and
perform properly date-sensitive functions involving dates prior to and after
December 31, 1999 (the "Year 2000 Problem"). The Year 2000 Problem will not
result, and is not reasonably expected to result, in any material adverse effect
on the business, properties, assets, financial condition, results of operations
or prospects of the Borrower, or the ability of the Borrower to duly and
punctually pay or perform its obligations hereunder and under the other Loan
Documents.
3.15. Disclosure. None of the Loan Documents contains or will contain
any untrue statement of material fact or omits or will omit to state a material
fact necessary in order to make the statements contained in this Agreement or
the Loan Documents not misleading. There is no fact known to the Borrower which
materially adversely affects or, so far as the Borrower can now foresee, might
materially adversely affect the business, assets, operations, financial
condition or results of operation of the Borrower and which has not otherwise
been fully set forth in this Agreement or in the Loan Documents.
4. Affirmative Covenants. The Borrower agrees that from the date of
execution of this Agreement until all Obligations have been fully paid and any
commitments of the Bank to the Borrower have been terminated, the Borrower will:
4.1. Books and Records. Maintain books and records in accordance with
GAAP and give representatives of the Bank access thereto at all reasonable
times, including permission to examine, copy and make abstracts from any of such
books and records and such other information as the Bank may from time to time
reasonably request, and the Borrower will make available to the Bank for
examination copies of any reports, statements or returns which the Borrower may
make to or file with any governmental department, bureau or agency, federal or
state.
4.2. Interim Financial Statements; Certificate of No Default. Furnish
the Bank within forty-five (45) days after the end of each fiscal quarter the
Borrower's Financial Statements for such period, in reasonable detail certified
by an authorized officer of the Borrower and prepared in accordance with GAAP
applied from period to period. The Borrower shall also deliver a certificate
from the Chief Executive Officer, President or Chief Financial Officer of the
Borrower as to compliance by the Borrower with applicable financial covenants
(containing detailed calculations of all financial covenants) for the period
then ended and whether any Event of Default exists, and, if so, the nature
thereof and the corrective measures the Borrower proposes to take. If the
Borrower is not a
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natural person, "Financial Statements" means the Borrower's consolidated and, if
required by the Bank in its sole discretion, consolidating balance sheets,
income statements and statements of cash flows for the year, month or quarter
together with year-to-date figures and comparative figures for the corresponding
periods of the prior year. If the Borrower is a natural person, "Financial
Statements" means the Borrower's personal financial statement and tax returns.
4.3. Annual Financial Statements. Furnish the Borrower's financial
Statements to the Bank within one hundred twenty (120) days after the end of
each fiscal year. Those Financial Statements will be prepared on a consolidating
and consolidated basis in accordance with GAAP by an independent certified
public accountant selected by the Borrower and satisfactory to the Bank,
together with (i) a report of such independent certified public accountant
satisfactory to the Bank; (ii) any management letters of such accountants
addressed to the Borrower, or either of them; and (iii) a certificate from the
Chief Executive Officer, President or Chief Financial Officer of the Borrower as
to compliance by the Borrower with applicable financial covenants (containing
detailed calculations of all financial covenants) for the period then ended and
whether any Event of Default exists. Audited Financial Statements shall contain
the unqualified opinion of an independent certified public accountant and its
examination shall have been made in accordance with GAAP consistently applied
from period to period.
4.4 Annual Budgets and Forecasts. Finish annual budgets and forecasts
for the Borrower to the Bank within one hundred twenty (120) days after the end
of each fiscal year of the Borrower.
4.5 Annual Financial Statements of Guarantor. Furnish the Bank within
one hundred twenty (120) days after the end of each fiscal year of Xxxxxxxx
Broadcast Group, Inc., a Maryland corporation ("Guarantor"), the Form 1OK filed
by Guarantor with the Securities and Exchange Commission.
4.6 Payment of Taxes and Other Charges. Pay and discharge when due all
indebtedness and all taxes, assessments, charges, levies and other liabilities
imposed upon the Borrower, its income, profits, property or business, except
those which currently are being contested in good faith by appropriate
proceedings and for which the Borrower shall have set aside adequate reserves or
made other adequate provision with respect thereto acceptable to the Bank in its
sole discretion.
4.7 Maintenance of Existence, Operation and Asset. Do all things
necessary to maintain, renew and keep in full force and effect its
organizational existence and all rights, permits and franchises necessary to
enable it to continue its business; continue in operation in substantially the
same manner as at present; keep its properties in good operating condition and
repair; and make all necessary and proper repairs, renewals, replacements,
additions and improvements thereto.
4.8 Insurance. Maintain with financially sound and reputable insurers,
insurance with respect to its property and business against such casualties and
contingencies, of such types and in such amounts as is customary for established
companies engaged in the same or similar business and similarly situated. In the
event of a conflict between the provisions of this Section and the terms of any
Security Documents relating to insurance, the provisions in the Security
Documents will control.
4.9 Compliance with Laws. Comply with all laws applicable to the
Borrower and to the operation of its business (including any statute, rule or
regulation relating to employment practices and pension benefits or to
environmental, occupational and health standards and controls).
4.10 Bank Accounts. Establish and maintain at the Bank the Borrower's
primary depository accounts.
4.11 Financial Covenants. Comply with all of the financial and other
covenants, if any, set forth on the Addendum.
4.12 Additional Reports. Provide prompt written notice to the Bank of
the occurrence of any of the following (together with a description of the
action which the Borrower proposes to take with respect thereto): (i) any Event
of Default or potential Event of Default, (ii) any litigation filed by or
against the Borrower that has potential exposure for Borrower in excess of
$50,000, or that might result in a material adverse change in the business,
assets, operations, financial condition or results of operation of Borrower;
(iii) any Reportable Event or Prohibited Transaction with respect to any
Employee Benefit Plans(s) (as defined in ERISA) or (iv) any event which might
result in a material adverse change in the business, assets, operations,
financial condition or results of operation of the Borrower.
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5. Negative Covenants. The Borrower covenants and agrees that from the date
of execution of this Agreement until all Obligations have been fully paid and
any commitments of the Bank to the Borrower have been terminated, the Borrower
will not, except as set forth in the Addendum, without the Bank's prior written
consent:
5.1. Idebtedness. Incur any indebtedness for borrowed money other
than; (i) the Loan and any subsequent indebtedness to the Bank; (ii) open
account trade debt incurred in the ordinary course of business and not past due;
and (iii) operating leases incurred in the ordinary course of business not to
exceed $50,000 in additional lease obligations incurred in any one year period.
5.2. Liens and Encumbrances. Except as provided in Section 3.6,
create, assume or permit to exist any mortgage, pledge, encumbrance or other
security interest or lien upon any assets now owned or hereafter acquired or
enter into any arrangement for the acquisition of property subject to any
conditional sales agreement.
5.3. Guarantees. Guarantee, endorse or become contingently liable for
the obligations of any person, firm or corporation, except in connection with
the endorsement and deposit of checks in the ordinary course of business for
collection.
5.4. Loans or Advances. Purchase or hold beneficially any stock, other
securities or evidences of indebtedness of, or make or have outstanding, any
loans or advances to, or make any investment or acquire any interest whatsoever
in, any other person, firm or corporation, except investments with or in Bank or
its affiliates or investments disclosed on the Borrower's Historical Financial
Statements or acceptable to the Bank in its sole discretion. Notwithstanding the
foregoing, Borrower may make loans or advances not to exceed $25,000 in the
aggregate made within any one year period to employees.
5.5. Merger or Transfer of Assets. Merge or consolidate with or into
any person, firm or corporation or lease, sell, transfer or otherwise dispose of
all, or substantially all, of its property, assets and business whether now
owned or hereafter acquired.
5.6. Change in Business, Management or Ownership. Make or permit any
material change in the nature of its business as carried on as of the date
hereof, in the composition of its current executive management, or in its equity
ownership.
5.7. Dividends Declare or pay any dividends on or make any
distribution with respect to any class of its equity or ownership interest, or
purchase, redeem, retire or otherwise acquire any of its equity, except for the
amount of federal and state income tax of the principals of the Borrower
attributable to the earnings of the Borrower where the Borrower is an S
corporation, or a partnership or a limited liability company.
6. Events of Default. The occurrence of any of the following will be deemed
to be an Event of Default:
6.1. Covenant Default. The Borrower shall default in the performance
of any of the covenants or agreements contained in this Agreement (other than
the requirement for the payment of money) and such default shall remain uncured
for a period of thirty (30) days after written notice by Bank to Borrower of the
default.
6.2. Breach of Warranty. Any Financial Statement, representation,
warranty or certificate made or furnished by the Borrower to the Bank in
connection with this Agreement shall be false, incorrect or incomplete when
made.
6.3. Other Default The occurrence of an Event of Default as defined in
the Note or any of the Security Documents.
Upon the occurrence of an Event of Default, the Bank will have all rights and
remedies specified in the Note and the Security Documents and all rights and
remedies (which are cumulative and not exclusive) available under applicable law
or in equity.
7. Conditions. The Bank's obligation to make any advance under the Loan is
subject to the conditions that as of the date of the advance:
7.1. No Event of Default. No Event of Default or event which with the
passage of time, provision of notice or both would constitute an Event of
Default shall have occurred and be continuing;
7.2. Authorization Documents. The Bank shall have been furnished
certified copies of resolutions of the board of directors, the general partners
or the members or managers of any partnership,
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corporation or limited liability company that executes this Agreement, the Note
or any of the Security Documents or the other Loan Documents; or other proof of
authorization satisfactory to the Bank; and
7.3. Receipt of Loan Documents. The Bank shall have received the Loan
Documents and such other instruments and documents which the Bank may reasonably
request in connection with the transactions provided for in this Agreement,
which may include an opinion of counsel for any party executing any of the Loan
Documents in form and substance satisfactory to the Bank.
8. Expenses. The Borrower agrees to pay the Bank, upon the closing of
this Agreement, and otherwise on demand, all reasonable costs and expenses
incurred by the Bank in connection with the preparation, negotiation and
delivery of this Agreement and the other Loan Documents, and any modifications
thereto, and the collection of all of Borrower's Obligations to the Bank,
including but not limited to enforcement actions, relating to the Loan, whether
through judicial proceedings or otherwise, or in defending or prosecuting any
actions or proceedings arising out of or relating to this Agreement, including
reasonable fees and expenses of counsel (which may include costs of in-house
counsel), expenses for auditors, appraisers and environmental consultants, lien
searches, recording and filing fees and taxes.
9. Increased Costs. On written demand, together with the written evidence
of the justification therefor, the Borrower agrees to pay the Bank, all direct
costs incurred and any losses suffered or payments made by the Bank as a
consequence of making the Loan by reason of any change in law or regulation or
its interpretation imposing any reserve, deposit, allocation of capital or
similar requirement (including without limitation, Regulation D of the Board of
Governors of the Federal Reserve System) on the Bank, its holding company or any
of their respective assets.
10. Miscellaneous.
10.1. Notices All notices, demands, requests, consents, approvals and
other communications required or permitted hereunder must be in writing and will
be effective upon receipt. Such notices and other communications may be
hand-delivered, sent by facsimile transmission with confirmation of delivery and
a copy sent by first-class mail, or sent by nationally recognized overnight
courier service, to a party's address set forth below or to such other address
as any party may give to the other in writing for such purpose:
To the Bank: PNC Bank, National Association
Valley Forge Regional Banking Center
0000 Xxxxxxxxx Xxxxx Xxxxx 000
Xxxxxx, XX 00000
Facsimile No. (000)000-0000
Telephone No.: (000)000-0000
Attention; Xxxxx X. Xxxxx, Vice-President
To the Borrower: Acrodyne Communications, Inc.
Acrodyne Industries, Inc.
000 Xxxxxxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000
Facsimile No.: (000)000-0000
Telephone No.: (000) 000-0000 Ext. 158
Attention: Xxxxxx X. Xxxxxxxxx
With a copy to: Xxxxxx X. Xxxxxx, Esquire
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000-0000
Facsimile No.: (000)000-0000
Telephone No.: (000) 000-0000
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10.2. Preservation of Rights. No delay or omission on the Bank's part
to exercise any right or power arising hereunder will impair any such right or
power or be considered a waiver of any such right or power, nor will the Bank 's
action or inaction impair any such right or power. The Bank's rights and
remedies hereunder are cumulative and not exclusive of any other rights or
remedies which the Bank may have under other agreements, at law or in equity.
10.3. Illegality. In case any one or more of the provisions contained
in this Agreement should be invalid, illegal or unenforceable in any respect,
the validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
10.4. Changes In Writing. No modification, amendment or waiver of any
provision of this Agreement nor consent to any departure by the Borrower
therefrom will be effective unless made in a writing signed by the party to be
charged, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice to or demand on the
Borrower in any case will entitle the Borrower to any other or further notice or
demand in the same, similar or other circumstance.
10.5. Entire Agreement. This Agreement (including the documents and
instruments referred to herein) constitutes the entire agreement and supersedes
all other prior agreements and understandings, both written and oral, between
the parties with respect to the subject matter hereof.
10.6. Counterparts. This Agreement may be signed in any number of
counterpart copies and by the parties hereto on separate counterparts, but all
such copies shall constitute one and the same instrument. Delivery of an
executed counterpart of a signature page to this Agreement by facsimile
transmission shall be effective as delivery of a manually executed counterpart.
Any party so executing this Agreement by facsimile transmission shall promptly
deliver a manually executed counterpart, provided that any failure to do so
shall not affect the validity of the counterpart executed by facsimile
transmission.
10.7. Successors and Assigns. This Agreement will be binding upon and
inure to the benefit of the Borrower and the Bank and their respective heirs,
executors, administrators, successors and assigns; provided however, that the
Borrower may not assign this Agreement in whole or in part without the Bank's
prior written consent and the Bank at any time may assign this Agreement in
whole or in part.
10.8. Interpretation. In this Agreement unless the Bank and the
Borrower otherwise agree in writing, the singular includes the plural and the
plural the singular; words importing any gender include the other genders;
references to statutes are to be construed as including all statutory provisions
consolidating, amending or replacing the statute referred to; the word "or"
shall be deemed to include "and/or", the words "including", "includes" and
"include" shall be deemed to be followed by the words "without limitation";
references to articles, sections (or subdivisions of sections) or exhibits are
to those of this Agreement unless otherwise indicated; and references to
agreements and other contractual instruments shall be deemed to include all
subsequent amendments and other modifications to such instruments, but only to
the extent such amendments and other modifications are not prohibited by the
terms of this Agreement. Section headings in this Agreement are included for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose. Unless otherwise specified in this Agreement, all
accounting terms shall be interpreted and all accounting determinations shall be
made in accordance with GAAP. If this Agreement is executed by more than one
party as Borrower, the obligations of such persons or entities will be joint and
several.
10.9. Indemnity. The Borrower agrees to indemnify each of the Bank,
its directors, officers and employees and each legal entity, if any, who
controls the Bank (the Indemnified Parties ) and to hold each Indemnified Party
harmless from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, all fees and charges of internal or
external counsel with whom any Indemnified Party may consult and all expenses of
litigation or preparation therefor) which any Indemnified Party may incur or
which may be asserted against any Indemnified Party in connection with or
arising out of the matters referred to in this Agreement or in the other Loan
Documents by any person, entity or governmental authority (including any person
or entity claiming derivatively on behalf of the Borrower), whether (a) arising
from or incurred in connection with any breach of a representation, warranty or
covenant by the Borrower, or (b) arising out of or resulting from any suit,
action, claim, proceeding or governmental investigation, pending or threatened,
whether based on statute, regulation or order, or tort, or contract or
otherwise, before any court or governmental authority, which arises out of or
relates to this Agreement, any other Loan Document, or the use of the proceeds
of the Loan; provided, however, that the foregoing indemnity agreement shall not
apply to claims, damages, losses, liabilities and expenses solely attributable
to an Indemnified Party's gross negligence or willful misconduct. The indemnity
agreement contained in this Section shall survive the termination of this
Agreement, payment of any Loan and assignment of any rights hereunder. The
Borrower may participate at its expense in the defense of any such action or
claim.
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10.10. Assignments and Participations. At any time, without any notice
to the Borrower, the Bank may sell, assign, transfer, negotiate, grant
participations in, or otherwise dispose of all or any part of the Bank's
interest in the Loan. Notwithstanding the foregoing, Bank shall endeavor to give
notice to Borrower of such disposition, but failure by Bank to give such notice
shall not in any manner constitute a default by Bank in its obligations to
Borrower. The Borrower hereby authorizes the Bank to provide, without any notice
to the Borrower, any information concerning the Borrower, including information
pertaining to the Borrower's financial condition, business operations or general
creditworthiness, to any person or entity which may succeed to or participate in
all or any part of the Bank's interest in the Loan.
10.11. Governing Law and Jurisdiction. This Agreement has been
delivered to and accepted by the Bank and will be deemed to be made in the State
where the Bank's office indicated above is located. THIS AGREEMENT WILL BE
INTERPRETED AND THE RIGHTS AND LIABILITIES OF THE PARTIES HERETO DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE STATE WHERE THE BANK'S OFFICE INDICATED ABOVE IS
LOCATED, EXCLUDING ITS CONFLICT OF LAWS RULES. The Borrower hereby irrevocably
consents to the exclusive jurisdiction of any state or federal court in the
county or judicial district where the Bank's office indicated above is located;
provided that nothing contained in this Agreement will prevent the Bank from
bringing any action, enforcing any award or judgment or exercising any rights
against the Borrower individually, against any security or against any property
of the Borrower within any other county, state or other foreign or domestic
jurisdiction. The Bank and the Borrower agree that the venue provided above is
the most convenient forum for both the Bank and the Borrower. The Borrower
waives any objection to venue and any objection based on a more convenient forum
in any action instituted under this Agreement.
WAIVER OF JURY TRIAL. EACH OF THE BORROWER AND THE BANK IRREVOCABLY
WAIVES ANY AND ALL RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR CLAIM OF ANY NATURE RELATING TO THIS AGREEMENT, ANY DOCUMENTS
EXECUTED IN CONNECTION WITH THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED IN
ANY OF SUCH DOCUMENTS. THE BORROWER AND THE BANK ACKNOWLEDGE THAT THE FOREGOING
WAIVER IS KNOWING AND VOLUNTARY.
11. Additional Conditions. The Bank's obligation to make any Loan to the
Borrower hereunder shall be subject to the following conditions:
11.1 Cancellation of Sovereign Bank Commitments. The Bank shall have
been furnished with evidence of cancellation of all commitments from, and
evidence of repayment in full of all indebtedness by the Borrower, or either of
them, to Sovereign Bank.
11.2 Termination of Sovereign Liens. The Bank shall have been
furnished with evidence of termination all liens granted by the Borrower, or
either of them, to Sovereign Bank on any and all personal property owned by
either of them (both tangible and intangible), both now owned or hereafter
acquired or arising.
The Borrower acknowledges that it has read and understood all the provisions of
this Agreement, including the waiver of jury trial, and his been advised by
counsel as necessary or appropriate.
8
WITNESS the due execution hereof as a document under seal, as of the date first
written above.
ATTEST: ACRODYNE COMMUNICATIONS, INC.
/s/ Xxxxx X. XxXxxxxxx By: /s/ A. Xxxxxx Xxxxxxx
Print Name: Xxxxx X. XxXxxxxxx (SEAL)
Title: Print Name: A. Xxxxxx Xxxxxxx
(Include title only if an officer Title: President
of entity signing to the
right)
ATTEST:
ACRODYNE INDUSTRIES, INC.
/s/ Xxxxx X. XxXxxxxxx By: /s/ Xxxxxx X. Xxxxxxxxx
Print Name: Xxxxx X. XxXxxxxxx (SEAL)
Title: Print Name: Xxxxxx X. Xxxxxxxxx
(Include title only if an officer Title: CFO
of entity signing to the
right)
PNC BANK, NATIONAL ASSOCIATION
(SEAL)
By: /s/ Xxxxxx Takonshian
Print Name: Xxxxxx Takonshian
Title: Vice President
9
COMMONWEALTH OF Pennsylvania )
) ss:
COUNTY OF Xxxxxxxxxx )
On this, the 19th day of Sept 1999, before me a Notary Public, the
undersigned officer, personally appeared A. Xxxxxx Xxxxxxx, who acknowledged
himself/herself to be the Pres CEO of Acrodyne Communications, Inc. a Delaware
corporation, and that he/she, as such officer, being authorized to do so,
executed the foregoing instrument for the purposes therein contained by signing
on behalf of said corporation as such officer.
IN WITNESS WHEREOF I hereunto set my hand and official seal.
NOTORIAL SEAL
XXX X. XXXXXXX, Notary Public
Plymouth Twp., Xxxxxxxxxx County
My Commission Expires Nov. 8, 1999 /s/ Xxx X. Xxxxxxx
Notary Public
My commission expires:
COMMONWEALTH OF Pennsylvania )
) ss:
COUNTY OF Xxxxxxxxxx )
On this, the 19th of Sept, 1999, before me, a Notary Public, the
undersigned officer, personally appeared Xxxxxx Xxxxxxxxx, who acknowledged
himself/herself to be the CFO of Acrodyne Industries, Inc. a Pennsylvania
corporation, and that he/she, as such officer, being authorized to do so,
executed the foregoing instrument for the purposes therein contained by signing
on behalf of said corporation as such officer.
IN WITNESS WHEREOF I hereunto set my hand and official seal.
NOTORIAL SEAL
XXX X. XXXXXXX, Notary Public
Plymouth Twp., Xxxxxxxxxx County
My Commission Expires Nov. 8, 1999 /s/ Xxx X. Xxxxxxx
Notary Public
My commission expires:
10
ADDENDUM to that certain Loan Agreement dated September _, 1999 among ACRODYNE
COMMUNICATIONS, INC., a Delaware corporation, and ACRODYNE INDUSTRIES, INC., a
Pennsylvania corporation, together as the Borrower and PNC BANK, NATIONAL
ASSOCIATION, as the Bank. Capitalized terms used in this Addendum and not
otherwise defined shall have the meanings given them in the Agreement. Section
numbers below refer to the sections of the Agreement.
3.6 Title to Assets. Describe additional liens and encumbrances below:
3.7 Litigation. Describe pending or threatened litigation, proceedings, etc,
below:
CONTINUATION OF ADDENDUM
FINANCIAL COVENANTS
X The Borrower will maintain at all times on and after December 31, 1999 a
minimum Tangible Net Worth of S4,500,000.00.
Cash Flow means net income plus depreciation plus amortization plus other
non-cash items.
Current Maturities means the current principal maturities of all indebtedness
for borrowed money (including amortization of capitalized lease obligations)
having an original term of one year or more, as shown on the Borrower's balance
sheet as of the end of the prior fiscal year, together with any prepayments of
such indebtedness made [during the prior fiscal year] [during the prior 12 month
period].
Tangible Net Worth means stockholders' equity in the Borrower less any
indebtedness to third parties and all items properly classified as intangibles,
in accordance with generally accepted accounting principles (including good will
and the value of all non-compete agreements) plus advances that the Bank deems
has been satisfactorily subordinated.
Unfunded Capital Expenditures mews capital expenditures made from the Borrower's
funds other than borrowed funds.
