BUSINESS LOAN AGREEMENT
PRINCIPAL LOAN DATE MATURITY LOAN NO.
$800,000.00 06-25-1997 11-30-1998 12348
CALL COLLATERAL ACCOUNT OFFICER INITIALS
510 07 13505 12 RH
Borrower: Hadron, Inc.; ▇▇.▇▇. Lender: Century National Bank
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ Office
Suite ▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, N.W.
Alexandria, VA 22311 Washington, DC 20006
THIS BUSINESS LOAN AGREEMENT between Hadron, Inc. SYCOM SERVICES,
INC. and ENGINEERING & INFORMATION SERVICES, INC. (referred to in
this Agreement individually and collectively as "Borrower") and
Century National Bank ("Lender") is made on the following terms
and conditions. Borrower has received prior commercial loans
from Lender or has applied to Lender for a commercial loan or
loans and other financial accommodations, including those which
may be described on any exhibit or schedule attached to this
Agreement. All such loans and financial accommodations, together
with all future loans and financial accommodations from Lender to
Borrower, are referred to in this Agreement individually as the
"Loan" and collectively as the "Loans." Borrower understands and
agrees that: (a) In granting, renewing, or extending any Loan,
Lender is relying upon Borrower's representations, warranties,
and agreements, as set forth in this Agreement; (b) the granting,
renewing, or extending of any Loan by Lender at all times shall
be subject to Lender's sole judgment and discretion; and (c) all
such Loans shall be and shall remain subject to the following
terms and conditions of this Agreement.
TERM. This Agreement shall be effective as of June 16, 1997,
and shall continue thereafter until all Indebtedness of
Borrower to Lender has been performed in full and the parties
terminate this Agreement in writing.
DEFINITIONS. The following words shall have the following
meanings when used in this Agreement. Terms not otherwise
defined in this Agreement shall have the meanings attributed to
such terms in the Uniform Commercial Code. All references to
dollar amounts shall mean amounts in lawful money of the United
States of America.
Agreement. The word "Agreement" means this Business Loan
Agreement, as this Business Loan Agreement may be amended or
modified from time to time, together with all exhibits and
schedules attached to this Business Loan Agreement from time
to time.
Borrower. The word "Borrower" means individualy and
collectively HADRON, INC., SYCOM SERVICES, INC. and
ENGINEERING & INFORMATION SERVICES, INC. and all other
persons and entities signing ▇▇▇▇▇▇▇▇'s Note.
CERCLA. The word "CERCLA" means the Comprehensive
Environmental Response, Compensation, and Liability Act of
1980, as amended.
Collateral. The word "Collateral" means and includes without
limitation all property and assets granted as collateral
security for a Loan, whether real or personal property,
whether granted directly or Indirectly, whether granted now
or in the future, and whether granted in the form of a
security interest, mortgage, deed of trust, assignment,
pledge, chattel mortgage, chattel trust, factor's lien,
equipment trust, conditional sale, trust receipt, lien,
charge, lien or title retention contract, lease or
consignment intended as a security device, or any other
security or lien interest whatsoever, whether created by law,
contract, or otherwise.
ERISA. The word "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended.
Event of Default. The words "Event of Default" mean and
include without limitation any of the Events of Default set
forth below In the section titled "EVENTS OF DEFAULT."
Grantor. The word "Grantor" means and includes without
limitation each and all of the persons or entities granting a
Security Interest in any Collateral for the Indebtedness, and
their personal representatives, successors and assigns.
Guarantor. The word "Guarantor" means and includes without
limitation each and all of the guarantors, sureties, and
accommodation parties in connection with any Indebtedness and
their personal representatives, successors and assigns.
Indebtedness. The word "Indebtedness" means and includes
without limitation all Loans, including all principal,
interest and other fees, costs and charges, if any, together
with all other present and future liabilities and obligations
of Borrower, or any one or more of them, to Lender, whether
direct or indirect, matured or unmatured, and whether
absolute or contingent, joint, several, or joint and several,
and no matter how the same may be evidenced or shall arise.
Lender. The word "Lender" means Century National Bank, its
successors and assigns.
Loan. The word "Loan" or "Loans" means and includes without
limitation any and all commercial loans and financial
accommodations from Lender to Borrower, whether now or
hereafter existing, and however evidenced, including without
limitation those loans and financial accommodations described
herein or described on any exhibit or schedule attached to
this Agreement from time to time.
Note. The word "Note" means and includes without limitation
Borrower's promissory note or notes, if any, evidencing
Borrower's Loan obligations in favor of Lender, as well as
any substitute, replacement or refinancing note or notes
therefor.
Permitted Liens. The words "Permitted Liens" mean: (a) liens
and security interests securing Indebtedness owed by Borrower
to Lender; (b) liens for taxes, assessments, or similar
charges either not yet due or being contested in good faith;
(c) liens of materialmen, mechanics, warehousemen, or
carriers, or other like liens arising in the ordinary course
of business and securing obligations which are not yet
delinquent; (d) purchase money liens or purchase money
security interests upon or in any property acquired or held
by Borrower in the ordinary course of business to secure
indebtedness outstanding on the date of this Agreement or
permitted to be incurred under the paragraph of this
Agreement titled "Indebtedness and Liens"; (a) liens and
security interests which, as of the date of this Agreement,
have been disclosed to and approved by the Lender in writing;
and (f) those liens and security interests which in the
aggregate constitute an immaterial and insignificant monetary
amount with respect to the net value of ▇▇▇▇▇▇▇▇'s assets.
Related Documents. The words "Related Documents" mean and
Include without limitation all promissory notes, credit
agreements, loan agreements, environmental agreements,
guaranties, security agreements, mortgages, deeds of trust,
and all other Instruments, agreements and documents, whether
now or hereafter existing, executed In connection with the
Indebtedness.
Security Agreement. The words "Security Agreement" mean and
include without limitation any agreements, promises,
covenants, arrangements, understandings or other agreements,
whether created by law, contract, or otherwise, evidencing,
governing, representing, or creating a Security Interest.
Security Interest. The words "Security Interest" mean and
include without limitation any and all types of lions and
encumbrances, whether created by law, contract, or otherwise.
▇▇▇▇. The word "▇▇▇▇" means the Superfund Amendments and
Reauthorization Act of 1986 as now or hereafter amended.
CONDITIONS PRECEDENT TO EACH ADVANCE. ▇▇▇▇▇▇'s obligation to
make the initial Loan Advance and each subsequent Loan Advance
under this Agreement shall be subject to the fulfillment to
▇▇▇▇▇▇'s satisfaction of all of the conditions set forth in
this Agreement and in the Related Documents.
Loan Documents. Borrower shall provide to Lender in form
satisfactory to Lender the following documents for the Loan:
(a) the Note, (b) Security Agreements granting to Lender
security interests In the Collateral, (c) Financing
Statements perfecting Lender's Security Interests; (d)
evidence of insurance as required below; and (e) any other
documents required under this Agreement or by Lender or its
counsel, including without limitation any assignments of life
Insurance described below and any guaranties described below.
Borrower's Authorization. Borrower shall have provided in
form and substance satisfactory to Lender properly certified
resolutions, duly authorizing the execution and delivery of
this Agreement, the Note and the Related Documents, and such
other authorizations and other documents and instruments as
Lender or its counsel, in their sole discretion, may require.
Payment of Fees and Expenses. Borrower shall have paid to
Lender all fees, charges, and other expenses which are then
due and payable as specified in this Agreement or any Related
Document.
Representations and Warranties. The representations and
warranties set forth in this Agreement, in the Related
Documents, and in any document or certificate delivered to
Lender under this Agreement are true and correct.
No Event of Default. There shall not exist at the time of
any advance a condition which would constitute an Event of
Default under this Agreement.
MULTIPLE BORROWERS. This agreement has been executed by
multiple obligors who are referred to herein individually,
collectively and interchangeably as "Borrower". Unless
specifically stated to the contrary, the word "Borrower" as
used in this Agreement, including without limitation all
representations, warranties and covenants, shall include all
Borrowers. ▇▇▇▇▇▇▇▇ understands and agrees that, with or
without notice to Borrower, Lender may with respect to any
other Borrower (a) make one or more additional secured or
unsecured loans or otherwise extend additional credit; (b)
alter, compromise, renew, extend, accelerate, or otherwise
change one or more times the time for payment or other terms
any indebtedness, including increases and decreases of the
rate of interest on the indebtedness; (c) exchange, enforce,
waive, subordinate, fail or decide not to perfect, and release
any security, with or without the substitution of new collateral;
(d) release, substitute, agree not to sue, or deal with any one
or more of Borrower's sureties, endorsers, or other guarantors on
any terms or in any manner Lender may choose; (e) determine how,
when and what application of payments and credits shall be made
on any indebtedness; (f) apply such security and direct the order
or manner of sale thereof, including without limitation, any
nonjudicial sale permitted by the terms of the controlling
security agreement or deed to trust, as Lender in its discretion
may determine; (g) sell, transfer, assign, or grant
participations in all or any part of the indebtedness; (h)
exercise or retain from exercising any rights against Borrower or
others, or otherwise act or refrain from acting; (i) settle or
compromise any indebtedness; and (j) subordinate the payment of
all or any part of any indebtedness of Borrower to Lender to the
payment of any liabilities which may be due Lender or others.
REPRESENTATIONS AND WARRANTIES. Borrower represents and
warrants to Lender, as of the date of this Agreement, as of the
date of each disbursement of Loan proceeds, as of the date of
any renewal, extension or modification of any Loan, and at all
times any Indebtedness exists:
Organization. Borrower Is a corporation which is duly
organized, validly existing, and in good standing under the
laws of the Commonwealth of Virginia and is validly existing
and in good standing in all states in which Borrower is doing
business. Borrower has the full power and authority to own
its properties and to transact the businesses in which It is
presently engaged or presently proposes to engage. Borrower
also is duly qualified as a foreign corporation and is in
good standing in all states In which the failure to so
quality would have a material adverse affect on its
businesses or financial condition.
Authorization. The execution, delivery, and performance of
this Agreement and all Related Documents by ▇▇▇▇▇▇▇▇, to the
extent to be executed, delivered or performed by Borrower,
have been duly authorized by all necessary action by
Borrower; do not require the consent or approval of any other
person, regulatory authority or governmental body; and do not
conflict with, result in a violation of, or constitute a
default under (a) any provision of its articles of
incorporation or organization, or bylaws, or any agreement or
other instrument binding upon Borrower or (b) any law.
governmental regulation, court decree, or order applicable to
Borrower.
Financial Information. Each financial statement of ▇▇▇▇▇▇▇▇
supplied to Lender truly and completely disclosed ▇▇▇▇▇▇▇▇'s
financial condition as of the date of the statement, and there
has been no material adverse change in Borrower's financial
condition subsequent to the date of the most recent financial
statement supplied to Lender. Borrower has no material
contingent obligations except as disclosed in such financial
statements.
Legal Effect. This Agreement constitutes, and any instrument
or agreement required hereunder to be given by ▇▇▇▇▇▇▇▇ when
delivered will constitute, legal, valid and binding
obligations of Borrower enforceable against Borrower in
accordance with their respective terms.
Properties. Except as contemplated by this Agreement or as
previously disclosed in ▇▇▇▇▇▇▇▇'s financial statements or in
writing to Lender and as accepted by ▇▇▇▇▇▇, and except for
property tax liens for taxes not presently due and payable,
Borrower owns and has good title to all of Borrower's
properties free and clear of all Security Interests, and has
not executed any security documents or financing statements
relating to such properties. All of ▇▇▇▇▇▇▇▇'s properties are
titled in Borrower's legal name, and ▇▇▇▇▇▇▇▇ has not used, or
filed a financing statement under, any other name for at least
the last five (5) years.
Hazardous Substances. The terms "hazardous waste," "hazardous
substance," "disposal," "release," and "threatened release," as
used in this Agreement, shall have the same meanings as set
forth in the "CERCLA," "▇▇▇▇," the Hazardous Materials
Transportation Act, 49 U.S.C. Section 1801, et seq., the
Resource Conservation and Recovery Act, 42 U.S.C. Section
6901, et seq., or other applicable state or Federal laws,
rules, or regulations adopted pursuant to any of the
foregoing. Except as disclosed to and acknowledged by ▇▇▇▇▇▇
in writing, ▇▇▇▇▇▇▇▇ represents and warrants that: (a) During
the period of Borrower's ownership of the properties, there
has been no use, generation, manufacture, storage, treatment,
disposal, release or threatened release of any hazardous waste
or substance by any person on, under, about or from any of the
properties. (b) Borrower has no knowledge of, or reason to
believe that there has been (i) any use, generation,
manufacture, storage, treatment, disposal, release, or
threatened release of any hazardous waste or substance on,
under, about or from the properties by any prior owners or
occupants of any of the properties, or (ii) any actual or
threatened litigation or claims of any kind by any person
relating to such matters. (c) Neither Borrower nor any tenant,
contractor, agent or other authorized user of any of the
properties shall use, generate, manufacture, store, treat,
dispose of, or release any hazardous waste or substance on,
under, about or from any of the properties; and any such
activity shall be conducted in compliance with all applicable
federal, state, and local laws, regulations, and ordinances,
including without limitation those laws, regulations and
ordinances described above. Borrower authorizes Lender and
its agents to enter upon the properties to make such
inspections and tests as Lender may deem appropriate to
determine compliance of the properties with this section of
the Agreement. Any inspections or tests made by Lender shall
be at Borrower's expense and for Lender's purposes only and
shall not be construed to create any responsibility or
liability on the part of Lender to Borrower or to any other
person. The representations and warranties contained herein
are based on Borrower's due diligence in investigating the
properties for hazardous waste and hazardous substances.
Borrower hereby (a) releases and waives any future claims
against Lender for indemnity or contribution in the event
Borrower becomes liable for cleanup or other costs under any
such laws, and (b) agrees to Indemnity and hold harmless
Lender against any and all claims, losses, liabilities,
damages, penalties, and expenses which Lender may directly or
indirectly sustain or suffer resulting from a breach of this
section of the Agreement or as a consequence of any use,
generation, manufacture, storage, disposal, release or
threatened release occurring prior to Borrower's ownership or
interest in the properties, whether or not the same was or
should have been known to Borrower. The provisions of this
section of the Agreement, including the obligation to
indemnity, shall survive the payment of the indebtedness and
the termination or expiration of this Agreement and shall not
be affected by Lender's acquisition of any interest in any of
the properties, whether by foreclosure or otherwise.
Litigation and Claims. No litigation, claim, investigation,
administrative proceeding or similar action (including those
for unpaid taxes) against Borrower is pending or threatened,
and no other event has occurred which may materially adversely
affect Borrower's financial condition or properties, other
than litigation, claims, or other events, if any, that have
been disclosed to and acknowledged by ▇▇▇▇▇▇ in writing.
Taxes. To the best of ▇▇▇▇▇▇▇▇'s knowledge, all tax returns
and reports of Borrower that are or were required to be filed,
have been filed, and all taxes, assessments and other
governmental charges have been paid in full, except those
presently being or to be contested by Borrower in good faith
in the ordinary course of business and for which adequate
reserves have been provided.
Lien Priority. Unless otherwise previously disclosed to
Lender in writing, ▇▇▇▇▇▇▇▇ has not entered into or granted
any Security Agreements, or permitted the filing or attachment
of any Security Interests on or affecting any of the
Collateral directly or indirectly securing repayment of
Borrower's Loan and Note, that would be prior or that may in
any way be superior to ▇▇▇▇▇▇'s Security Interests and rights
in and to such Collateral.
Binding Effect. This Agreement, the Note, all Security
Agreements directly or indirectly securing repayment of
▇▇▇▇▇▇▇▇'s Loan and Note and all of the Related Documents are
binding upon Borrower as well as upon ▇▇▇▇▇▇▇▇'s successors,
representatives and assigns, and are legally enforceable in
accordance with their respective terms.
Commercial Purposes. Borrower intends to use the Loan
proceeds solely for business or commercial related purposes.
Employee Benefit Plans. Each employee benefit plan as to
which Borrower may have any liability complies in all material
respects with all applicable requirements of law and
regulations, and (i) no Reportable Event nor Prohibited
Transaction (as defined in ERISA) has occurred with respect to
any such plan, (ii) Borrower has not withdrawn from any such
plan or initiated steps to do so, (iii) no steps have been
taken to terminate any such plan, and (iv) there are no
unfunded liabilities other than those previously disclosed to
Lender in writing.
Location of ▇▇▇▇▇▇▇▇'s Offices and Records. ▇▇▇▇▇▇▇▇'s place
of business, or ▇▇▇▇▇▇▇▇'s Chief executive office, if ▇▇▇▇▇▇▇▇
has more than one place of business, is located at ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇ 1. Unless
Borrower has designated otherwise in writing this location Is
also the office or offices where Borrower keeps its records
concerning the Collateral.
Information. All information heretofore or contemporaneously
herewith furnished by Borrower to Lender for the purposes of
or in connection with this Agreement or any transaction
contemplated hereby is, and all information hereafter
furnished by or on behalf of Borrower to Lender will be, true
and accurate in every material respect on the date as of which
such information is dated or certified; and none of such
information is or will be incomplete by omitting to state any
material fact necessary to make such information not
misleading.
Survival of Representations and Warranties. ▇▇▇▇▇▇▇▇
understands and agrees that ▇▇▇▇▇▇, without Independent
Investigation, Is relying upon the above representations and
warranties in extending Loan Advances to Borrower. ▇▇▇▇▇▇▇▇
further agrees that the foregoing representations and
warranties shall be continuing in nature and shall remain in
full force and effect until such time as Borrower's
Indebtedness shall be paid in full, or until this Agreement
shall be terminated in the manner provided above, whichever is
the last to occur.
AFFIRMATIVE COVENANTS. Borrower covenants and agrees with ▇▇▇▇▇▇
that, while this Agreement is in effect, Borrower will:
Litigation. Promptly inform ▇▇▇▇▇▇ in writing of (a) all
material adverse changes in Borrower's financial condition,
and (b) all existing and all threatened litigation, claims,
investigations, administrative proceedings or similar actions
affecting Borrower or any Guarantor which could materially
affect the financial condition of Borrower or the financial
condition of any Guarantor.
Financial Records. Maintain its books and records in
accordance with generally accepted accounting principles,
applied on a consistent basis, and permit ▇▇▇▇▇▇ to examine
and audit ▇▇▇▇▇▇▇▇'s books and records at all reasonable
times.
Financial Statements. Furnish Lender with, as soon as
available, but in no event later than ninety (90) days after
the end of each fiscal year, ▇▇▇▇▇▇▇▇'s balance sheet and
income statement for the year ended, prepared by ▇▇▇▇▇▇▇▇.
All financial reports required to be provided under this
Agreement shall be prepared in accordance with generally
accepted accounting principles, applied on a consistent basis,
and certified by Borrower as being true and correct.
Additional Information. Furnish such additional information
and statements, lists of assets and liabilities, agings of
receivables and payables, inventory schedules, budgets,
forecasts, tax returns, and other reports with respect to
▇▇▇▇▇▇▇▇'s financial condition and business operations as
Lender may request from time to time.
Insurance. Maintain fire and other risk insurance, public
liability insurance, and such other Insurance as Lender may
from time to time reasonably require with respect to
Borrower's properties and operations, in form, amounts,
coverages and with insurance companies acceptable to Lender.
Borrower, upon request of ▇▇▇▇▇▇, will deliver to Lender from
time to time the policies or certificates of insurance in form
satisfactory to Lender, including stipulations that coverages
will not be cancelled or diminished without at least ten (10)
days' prior written notice to Lender. Each insurance policy
also shall include an endorsement providing that coverage in
favor of Lender will not be impaired in any way by any act,
omission or default of Borrower or any other person. In
connection with all policies covering assets In which Lender
holds or Is offered a security interest for the Loans,
Borrower will provide Lender with such loss payable or other
endorsements as Lender may require.
Insurance Reports. Furnish to Lender, upon request of Lender,
reports on each existing Insurance policy showing such
Information as Lender may reasonably request, including
without limitation the following: (a) the name of the Insurer;
(b) the risks Insured; (c) the amount of the policy; (d) the
properties Insured; (e) the then current property values on
the basis of which Insurance has been obtained, and the manner
of determining those values; and (f) the expiration date of
the policy. In addition, upon request of Lender (however not
more often than annually), Borrower will have an independent
appraiser satisfactory to Lender determine, as applicable, the
actual cash value or replacement cost of any Collateral. The
cost of such appraisal shall be paid by Borrower.
Life Insurance. As soon as practical, obtain and maintain
life insurance In form and with insurance companies acceptable
to Lender on the following individuals in the amounts
indicated below and, at Lender's option, cause such insurance
coverage to be pledged, made payable to, or assigned to Lender
on ▇▇▇▇▇▇'s forms. Lender, at its discretion, may apply the
proceeds of any insurance policy to the unpaid balances of any
Indebtedness:
Names of Insured Amounts
▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ $482,407.22
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ $483,057.52
Guaranties. Prior to disbursement of any Loan proceeds,
furnish executed guaranties of the Loans in favor of ▇▇▇▇▇▇,
on ▇▇▇▇▇▇'s forms, and in the amounts and by the guarantors
named below:
Guarantors Amounts
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Unlimited
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Unlimited
Subordination. Prior to disbursement of any Loan proceeds,
deliver to Lender subordination agreements on ▇▇▇▇▇▇'s forms,
executed by ▇▇▇▇▇▇▇▇'s creditors named below, subordinating all
of Borrower's indebtedness to such creditors, or such lesser
amounts as may be agreed to by ▇▇▇▇▇▇ in writing, and any
security interests in collateral securing that indebtedness to
the Loans and security interests of Lender.
Names of Creditors Amounts
▇. ▇▇▇▇▇ ▇▇▇▇▇▇ $24,000.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. $24,000.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $24,000.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ $24,000.00
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ $24,000.00
Other Agreements. Comply with all terms and conditions of all
other agreements, whether now or hereafter existing, between
Borrower and any other party and notify Lender immediately in
writing of any default In connection with any other such
agreements.
Loan Proceeds. Use all Loan proceeds solely for ▇▇▇▇▇▇▇▇'s
business operations, unless specifically consented to the
contrary by ▇▇▇▇▇▇ In writing.
Taxes, Charges and Liens. Pay and discharge when due all of
Its Indebtedness and obligations, including without limitation
all assessments, taxes, governmental charges, levies and
liens, of every kind and nature, imposed upon Borrower or its
properties, income, or profits, prior to the date on which
penalties would attach, and all lawful claims that. if unpaid,
might become a lien or charge upon any of Borrower's
properties, income, or profits. Provided however, ▇▇▇▇▇▇▇▇
will not be required to pay and discharge any such assessment,
tax, charge, ▇▇▇▇, ▇▇▇▇ or claim so long as (a) the legality
of the same shall be contested in good faith by appropriate
proceedings, and (b) Borrower shall have established on its
books adequate reserves with respect to such contested
assessment, tax, charge, levy, lien, or claim in accordance
with generally accepted accounting practices. ▇▇▇▇▇▇▇▇, upon
demand of Lender, will furnish to Lender evidence of payment
of the assessments, taxes, charges, levies, liens and claims
and will authorize the appropriate governmental official to
deliver to Lender at any time a written statement of any
assessments. taxes, charges, levies, liens and claims against
▇▇▇▇▇▇▇▇'s properties, Income, or profits.
Performance. Perform and comply with all terms, conditions,
and provisions set forth In this Agreement and in the Related
Documents in a timely manner, and promptly notify Lender it
Borrower learns of the occurrence of any event which
constitutes an Event of Default under this Agreement or under
any of the Related Documents.
Operations. Maintain executive and management personnel with
substantially the same qualifications and experience as the
present executive and management personnel; provide written
notice to Lender of any change in executive and management
personnel; conduct its business affairs in a reasonable and
prudent manner and in compliance with all applicable federal,
state and municipal laws, ordinances, rules and regulations
respecting its properties, charters, businesses and
operations, including without limitation, compliance with the
Americans With Disabilities Act and with all minimum funding
standards and other requirements of ERISA and other laws
applicable to Borrower's employee benefit plans.
Inspection. Permit employees or agents of Lender at any
reasonable time to inspect any and all Collateral for the Loan
or Loans and ▇▇▇▇▇▇▇▇'s other properties and to examine or
audit ▇▇▇▇▇▇▇▇'s books, accounts, and records and to make
copies and memoranda of ▇▇▇▇▇▇▇▇'s books, accounts, and
records. If Borrower now or at any time hereafter maintains
any records (including without limitation computer generated
records and computer software programs for the generation of
such records) in the possession of a third party, Borrower,
upon request of ▇▇▇▇▇▇, shall notify such party to permit
Lender free access to such records at all reasonable times and
to provide Lender with copies of any records it may request,
all at Borrower's expense.
Compliance Certificate. Unless waived in writing by ▇▇▇▇▇▇,
provide Lender at least annually and at the time of each
disbursement of Loan proceeds with a certificate executed by
▇▇▇▇▇▇▇▇'s chief financial officer, or other officer or person
acceptable to Lender, certifying that the representations and
warranties set forth in this Agreement are true and correct as
of the date of the certificate and further certifying that, as
of the date of the certificate, no Event of Default exists
under this Agreement.
Environmental Compliance and Reports. Borrower shall comply
in all respects with all environmental protection federal,
state and local laws, statutes, regulations and ordinances;
not cause or permit to exist, as a result of an intentional or
unintentional action or omission on its part or on the part of
any third party, on property owned and/or occupied by
Borrower, any environmental activity where damage may result
to the environment, unless such environmental activity is
pursuant to and in compliance with the conditions of a permit
issued by the appropriate federal, state or local governmental
authorities; shall furnish to Lender promptly and in any event
within thirty (30) days after receipt thereof a copy of any
notice, summons, lien, citation, directive, letter or other
communication from any governmental agency or instrumentality
concerning any intentional or unintentional action or omission
on Borrower's part in connection with any environmental
activity whether or not there is damage to the environment
and/or other natural resources.
Additional Assurances. Make, execute and deliver to Lender
such promissory notes, mortgages, deeds of trust, security
agreements, financing statements, instruments, documents and
other agreements as Lender or its attorneys may reasonably
request to evidence and secure the Loans and to perfect all
Security Interests.
NEGATIVE COVENANTS. Borrower covenants and agrees with Lender
that while this Agreement is in effect, Borrower shall not,
without the prior written consent of Lender:
Indebtedness and Liens. (a) Except for trade debt Incurred in
the normal course of business and Indebtedness to Lender
contemplated by this Agreement, create, incur or assume
indebtedness for borrowed money, including capital leases, (b)
except as allowed as a Permitted Lien, sell, transfer,
mortgage, assign, pledge, lease, grant a security Interest In,
or encumber any of Borrower's assets, or (c) sell with
recourse any of Borrower's accounts, except to Lender.
Continuity of Operations. (a) Engage in any business
activities substantially different than those in which
Borrower is presently engaged, (b) cease operations,
liquidate, merge, transfer, acquire or consolidate with any
other entity, change ownership, change its name, dissolve or
transfer or sell Collateral out of the ordinary course of
business, (c) pay any dividends on Borrower's stock (other
than dividends payable in its stock), provided, however that
notwithstanding the foregoing, but only so long as no Event of
Default has occurred and is continuing or would result from
the payment of dividends, if Borrower is a "Subchapter S
Corporation" (as defined in the Internal Revenue Code of 1986,
as amended), Borrower may pay cash dividends on its stock to
its shareholders from time to time in amounts necessary to
enable the shareholders to pay income taxes and make estimated
income tax payments to satisfy their liabilities under federal
and state law which arise solely from their status as
Shareholders of a Subchapter S Corporation because of their
ownership of shares of stock of Borrower, or (d) purchase or
retire any of Borrower's outstanding shares or alter or amend
Borrower's capital structure.
Loans, Acquisitions and Guaranties. (a) Loan, invest in or
advance money or assets, (b) purchase, create or acquire any
interest In any other enterprise or entity, or (c) Incur any
obligation as surety or guarantor other than In the ordinary
course of business.
CESSATION OF ADVANCES. If Lender has made any commitment to
make any Loan to Borrower, whether under this Agreement or
under any other agreement, Lender shall have no obligation to
make Loan Advances or to disburse Loan proceeds if: (a)
Borrower or any Guarantor is in default under the terms of
this Agreement or any of the Related Documents or any other
agreement that Borrower or any Guarantor has with Lender; (b)
Borrower or any Guarantor becomes insolvent, files a petition
in bankruptcy or similar proceedings, or is adjudged a
bankrupt; (c) there occurs a material adverse change in
Borrower's financial condition, in the financial condition of
any Guarantor, or In the value of any Collateral securing any
Loan; or (d) any Guarantor seeks, claims or otherwise attempts
to limit, modify or revoke such Guarantor's guaranty of the
Loan or any other loan with Lender (e) Lender in good ▇▇▇▇▇
▇▇▇▇▇ itself insecure, even though no Event of Default shall
have occurred.
RIDER TO BUSINESS LOAN AGREEMENT. An Exhibit, titled "RIDER
TO BUSINESS LOAN AGREEMENT", is attached to this Agreement and
by this reference is made a part of this Agreement just as if
all the provisions, terms and conditions of the Exhibit had
been fully set forth in this Agreement.
RIGHT OF SETOFF. Borrower grants to Lender a contractual
possessor security interest in, and hereby assigns, conveys,
delivers, pledges, and transfers to Lender all Borrower's
right, title and interest in and to, ▇▇▇▇▇▇▇▇'s accounts with
Lender (whether checking, savings, or some other account),
including without limitation all accounts hold jointly with
someone else and all accounts Borrower may open In the future,
excluding however all IRA and ▇▇▇▇▇ accounts, and all trust
accounts for which the grant of a security interest would be
prohibited by law. ▇▇▇▇▇▇▇▇ authorizes ▇▇▇▇▇▇, to the extent
permitted by applicable law, to charge or setoff all sums
owing on the Indebtedness against any and all such accounts,
and, at ▇▇▇▇▇▇'s option, to administratively freeze all such
accounts to allow Lender to protect ▇▇▇▇▇▇'s charge and setoff
rights provided on this paragraph.
EVENTS OF DEFAULT. Each of the following shall constitute an
Event of Default under this Agreement:
Default on Indebtedness. Failure of Borrower to make any
payment when due on the Indebtedness.
Other Defaults. Failure of Borrower or any Grantor to comply
with or to perform when due any other term. obligation.
covenant or condition contained In this Agreement or In any of
the Related Documents, or failure of Borrower to comply with
or to perform any other term, obligation, covenant or
condition contained in any other agreement between Lender and
Borrower.
Default In Favor of Third Parties. Should Borrower or any
Grantor default under any loan, extension of credit, security
agreement, purchase or sales agreement, or any other
agreement, in favor of any other creditor or person that may
materially affect any of Borrower's property or Borrower's or
any Grantor's ability to repay the Loans or perform their
respective obligations under this Agreement or any of the
Related Documents.
False Statements. Any warranty, representation or statement
made or furnished to Lender by or on behalf of Borrower or any
Grantor under this Agreement or the Related Documents is false
or misleading in any material respect at the time made or
misleading at any time thereafter.
Defective Collateralization. This Agreement or any of the
Related Documents ceases to be in full force and effect
(including failure of any Security Agreement to create a valid
and perfected Security Interest) at any time and for any
reason.
Insolvency. The dissolution or termination of Borrower's
existence as a going business, or a trustee or receiver is
appointed for Borrower or for all or a substantial portion of
the assets of Borrower, or ▇▇▇▇▇▇▇▇ makes a general assignment
for the benefit of ▇▇▇▇▇▇▇▇'s creditors, or Borrower files for
bankruptcy, or an involuntary bankruptcy petition is filed
against Borrower and such involuntary petition remains
undismissed for sixty (60) days.
Creditor or Forfeiture Proceedings. Commencement of
foreclosure or forfeiture proceedings, whether by judicial
proceeding, self-help, repossession or any other method, by
any creditor of Borrower, any creditor of any Grantor against
any collateral securing the Indebtedness, or by any
governmental agency. This includes a garnishment, attachment,
or levy on or of any of Borrower's deposit accounts with
Lender. However, this Event of Default shall not apply if
there is a good faith dispute by Borrower or Grantor, as the
case may be, as to the validity or reasonableness of the claim
which is the basis of the creditor or forfeiture proceeding,
and if Borrower or Grantor gives ▇▇▇▇▇▇ written notice of the
creditor or forfeiture proceeding and furnishes reserves or a
surety bond for the creditor or forfeiture proceeding
satisfactory to Lender.
Events Affecting Guarantor. Any of the preceding events
occurs with respect to any Guarantor of any of the
Indebtedness or any Guarantor dies or becomes Incompetent, or
revokes or disputes the validity of, or liability under, any
Guaranty of the Indebtedness. Lender, at its option, may, but
shall not be required to, permit the Guarantor's estate to
assume unconditionally the obligations arising under the
guaranty in a manner satisfactory to Lender, and, in doing so,
cure the Event of Default.
Events Affecting Co-Borrowers. Any of the preceding events
occurs with respect to any co-borrower of any of the indebtedness
or any co-borrower dies or becomes incompetent, or revokes or
disputes the validity of, or liability under, any of the
indebtedness. Lender, at its option, may, but shall not be
required to, permit the co-borrower's estate to assume
unconditionally the obligations on the indebtedness in a manner
satisfactory to Lender, and , in doing so, cure the Event of
Default.
Change In Ownership. Any change in ownership of twenty-five
percent (25%) or more of the common stock of Borrower.
Adverse Change. A material adverse change occurs in
Borrower's financial condition, or ▇▇▇▇▇▇ believes the
prospect of payment or performance of the Indebtedness is
impaired.
Insecurity. Lender, in good faith, deems itself insecure.
Right to Cure. If any default, other than a Default on
Indebtedness, is curable and if Borrower or Grantor, as the
case may be, has not been given a notice of a similar default
within the preceding twelve (1 2) months, it may be cured (and
no Event of Default will have occurred) if Borrower or
Grantor, as the case may be, after receiving written notice
from Lender demanding cure of such default: (a) cures the
default within ten (10) days; or (b) If the cure requires more
than ten (10) days, Immediately initiates steps which Lender
deems in ▇▇▇▇▇▇'s sole discretion to be sufficient to cure the
default and thereafter continues and completes all reasonable
and necessary steps sufficient to produce compliance as soon
as reasonably practical.
EFFECT OF AN EVENT OF DEFAULT. If any Event of Default shall
occur, except where otherwise provided in this Agreement or the
Related Documents, all commitments and obligations of Lender
under this Agreement or the Related Documents or any other
agreement immediately will terminate (including any obligation to
make Loan Advances or disbursements), and, at Lender's option,
all sums owing in connection with the Loans, including all
principal, Interest, and all other fees, costs and charges, if
any, will become Immediately due and payable, all without notice
of any kind to Borrower, except that in the case of an Event of
Default of the type described in the "Insolvency" subsection
above, such acceleration shall be automatic and not optional. In
addition, Lender shall have all the rights and remedies provided
in the Related Documents or available at law, in equity, or
otherwise. Except as may be prohibited by applicable law, all of
Lender's rights and remedies shall be cumulative and may be
exercised singularly or concurrently. Election by ▇▇▇▇▇▇ to
pursue any remedy shall not exclude pursuit of any other remedy,
and an election to make expenditures or to take action to perform
an obligation of Borrower or of any Grantor shall not affect
▇▇▇▇▇▇'s right to declare a default and to exercise its rights
and remedies.
MISCELLANEOUS PROVISIONS. The following miscellaneous provisions
are a part of this Agreement:
Amendments. This Agreement, together with any Related Documents,
constitutes the entire understanding and agreement of the parties
as to the matters set forth in this Agreement. No alteration of
or amendment to this Agreement shall be effective unless given in
writing and signed by the party or parties sought to be charged
or bound by the alteration or amendment.
Applicable Law. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the
District of Columbia. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ hereby waive the
right to any jury trial in any action, proceeding, or
counterclaim brought by either party against the other.
Caption Headings. Caption headings in this Agreement are for
convenience purposes only and are not to be used to interpret
or define the provisions of this Agreement.
Consent to Loan Participation. ▇▇▇▇▇▇▇▇ agrees and consents
to ▇▇▇▇▇▇'s safe or transfer, whether now or later, of one or
more participation interests in the Loans to one or more
purchasers, whether related or unrelated to Lender. Lender
may provide, without any limitation whatsoever, to any one or
more purchasers, or potential purchasers, any information or
knowledge Lender may have about Borrower or about any other
matter relating to the Loan, and Borrower hereby waives any
rights to privacy it may have with respect to such matters.
Borrower additionally waives any and all notices of sale of
participation interests, as well as all notices of any
repurchase of such participation interests. ▇▇▇▇▇▇▇▇ also
agrees that the purchasers of any such participation interests
will be considered as the absolute owners of such interests in
the Loans and will have all the rights granted under the
participation agreement or agreements governing the sale of
such participation interests. Borrower further waives all
rights of offset or counterclaim that it may have now or later
against Lender or against any purchaser of such a
participation interest and unconditionally agrees that either
Lender or such purchaser may enforce ▇▇▇▇▇▇▇▇'s obligation
under the Loans irrespective of the failure or insolvency of
any holder of any interest in the Loans. ▇▇▇▇▇▇▇▇ further
agrees that the purchaser of any such participation interests
may enforce its interests irrespective of any personal claims
or defenses that Borrower may have against ▇▇▇▇▇▇.
Costs and Expenses. ▇▇▇▇▇▇▇▇ agrees to pay upon demand all of
▇▇▇▇▇▇'s out-of-pocket expenses incurred in connection with
this Agreement or in connection with the Loans made pursuant
to this Agreement. Subject to any limits under applicable
law, If ▇▇▇▇▇▇ hires an attorney to help enforce this
Agreement or to collect any Indebtedness, ▇▇▇▇▇▇▇▇ agrees to
pay ▇▇▇▇▇▇'s reasonable attorneys' fees, and all of ▇▇▇▇▇▇'s
other collection expenses, whether or not there is a lawsuit
and including legal expenses for bankruptcy proceedings.
Notices. All notices required to be given under this
Agreement shall be given in writing, may be sent by
▇▇▇▇▇▇▇▇▇▇▇▇▇▇, and shall be effective when actually delivered
If hand delivered or when deposited with a nationally
recognized overnight courier or deposited as certified or
registered mail in the United States mail, first class,
postage prepaid, addressed to the party to whom the notice is
to be given at the address shown above. Any party may change
its address for notices under this Agreement by giving formal
written notice to the other parties, specifying that the
purpose of the notice is to change the party's address. To
the extent permitted by applicable law, If there Is more than
one Borrower, notice to any Borrower will constitute notice to
all Borrowers. For notice purposes, Borrower will keep ▇▇▇▇▇▇
informed at all times of ▇▇▇▇▇▇▇▇'s current addressees).
Severability. If a court of competent jurisdiction finds any
provision of this Agreement to be invalid or unenforceable as
to any person or circumstance, such finding shall not render
that provision invalid or unenforceable as to any other
persons or circumstances. If feasible, any such offending
provision shall be deemed to be modified to be within the
limits of enforceability or validity; however, If the
offending provision cannot be so modified, it shall be
stricken and all other provisions of this Agreement in all
other respects shall remain valid and enforceable.
Subsidiaries and Affiliates of Borrower. To the extent the
context of any provisions of this Agreement makes It
appropriate, including without limitation any representation,
warranty or covenant, the word "Borrower" as used herein shall
include all subsidiaries and affiliates of Borrower.
Notwithstanding the foregoing however, under no circumstances
shall this Agreement be construed to require Lender to make
any Loan or other financial accommodation to any subsidiary or
affiliate of Borrower.
Successors and Assigns. All covenants and agreements
contained by or on behalf of Borrower shall bind its
successors and assigns and shall inure to the benefit of
Lender, its successors and assigns. Borrower shall not,
however, have the right to assign Its rights under this
Agreement or any interest therein, without the prior written
consent of Lender.
Survival. All warranties, representations, and agreements of
Borrower in this Agreement shall survive the making of the
Loan or Loans contemplated hereby, and shall be deemed made
and redated by ▇▇▇▇▇▇▇▇ at the time of the making of each
disbursement of Loan proceeds.
Time Is of the Essence. Time Is of the essence In the
performance of this Agreement.
Waiver. Indulgence by ▇▇▇▇▇▇ with respect to any of the terms
and conditions of this Agreement or the failure of Lender to
exercise any of its rights under this Agreement shall not
constitute a waiver thereof, and Borrower shall remain liable
for the strict performance of such terms and conditions until
this Agreement shall be terminated. No provision of this
Agreement may be waived or modified orally, but all such
waivers or modifications shall be In writing. Whenever the
consent of Lender Is required under this Agreement, the
granting of such consent by ▇▇▇▇▇▇ in one instance shall not
constitute ▇▇▇▇▇▇'s continuing consent in subsequent
instances, and in all cases such consent may be granted or
withheld in the sole discretion of Lender.
THIS BUSINESS LOAN AGREEMENT IS SIGNED, SEALED AND DELIVERED
EFFECTIVE IN ALL RESPECTS AS OF June 25, 1997.
BORROWER:
Hadron, Inc.
By: /S/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (SEAL)
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
Chairman and Chief Executive Officer
SYCOM SERVICES INC. - Co-Borrower
By: /S/ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ -(SEAL)
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
President
ENGINEERING & INFORMATION SERVICES, INC. - Co-Borrower
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ - (SEAL)
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President
LENDER:
Century National Bank
By: /S/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Authorized Officer
