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EXHIBIT 10.3
REVOLVING LOAN AGREEMENT
This REVOLVING LOAN AGREEMENT (this "LOAN AGREEMENT") is made as of
March 27, 1997, by and between NEXSTAR PHARMACEUTICALS, INC., a Delaware
corporation (the "BORROWER"), having its principal place of business at 0000
Xxxxxxxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000 and, BANK OF BOSTON CONNECTICUT (the
"BANK"), a Connecticut state chartered bank with its head office at 00 Xxxxx
Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000.
1. DEFINITIONS: Certain capitalized terms are defined below:
Availability: With respect to the WP Loan Agreement, the difference
between the Total Commitment (as defined in the WP Loan Agreement) minus the
sum of (a) the outstanding Loans (as defined in the WP Loan Agreement), (b) the
Letter of Credit Outstandings (as defined in the WP Loan Agreement) and (c)
Contingent Obligations (as defined in the WP Loan Agreement) to the extent that
the Total Commitment (as defined in the WP Loan Agreement) is reduced by the
amount of such Contingent Obligations.
Base Rate: The higher of (a) the annual rate of interest announced from
time to time by the First National Bank of Boston at its head office in Boston,
Massachusetts, as its "BASE RATE" or (b) 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 Bank from three
funds brokers of recognized standing selected by the Bank.
Base Rate Loans: Loans bearing interest calculated by reference to the
Base Rate.
Business Day: Any day on which banks in Hartford, Connecticut are open
for business generally.
Charter Documents: With respect to any Person, the certificate or
articles of incorporation or organization and the by-laws of such Person, or
other constitutive documents of such entity.
Closing Date: March 27, 1997.
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Commitment: The obligation of the Bank to make Loans to the Borrower
up to an aggregate outstanding principal amount not to exceed $15,000,000, as
such amount may be reduced from time to time or terminated hereunder.
Consent: In respect of any Person, any permit, license or exemption
from, approval, consent of, registration or filing with any local, state or
federal governmental or regulatory agency or authority, required under
applicable law.
Consolidated Current Assets: All assets of the Borrower and its
Subsidiaries on a consolidated basis that, in accordance with GAAP, are
properly classified as current assets.
Consolidated Current Liabilities: All liabilities of the Borrower and
its Subsidiaries on a consolidated basis maturing on demand or within one (1)
year from the date as of which Consolidated Current Liabilities are to be
determined, and such other liabilities as may properly be classified as current
liabilities in accordance with GAAP.
Consolidated Shareholders' Equity: The consolidated shareholders'
equity of the Borrower and its Subsidiaries as determined in accordance with
GAAP.
Conversion Request: A notice given to the Bank by the Borrower after
Borrower's election to convert or to continue a Loan in accordance with Section
4 hereof.
Default: An event or act which with the giving of notice and/or the
lapse of time, would become an Event of Default.
Distribution: The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of the Borrower or any
other distribution on or in respect of any shares of any class of capital stock
of the Borrower, other than dividends and distributions payable solely in
shares of capital stock of the Borrower; the purchase, redemption, or other
retirement of any shares of any class of capital stock of the Borrower,
directly or indirectly through a Subsidiary of the Borrower or otherwise; or
the return of capital by the Borrower to its shareholders as such.
Dollars or $: Dollars in lawful currency of the United States of
America.
Drawdown Date: In respect of any Loan, the date on which such Loan is
made to the Borrower.
Environmental Laws: All laws pertaining to environmental matters,
including without limitation, the Resource Conservation and Recovery Act, the
Comprehensive Environmental Response Compensation and Liability Act of 1980,
the Superfund Amendments and Reauthorization Act of 1986, the Federal
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Clean Water Act, the Federal Clean Air Act, the Toxic Substances Control Act,
in each case as amended, and all rules, regulations, judgments, decrees, orders
and licenses arising under all such laws.
ERISA: The Employee Retirement Income Security Act of 1974, as
amended, and all rules, regulations, judgments, decrees, and orders arising
thereunder.
Eurocurrency Reserve Rate. For any day with respect to a Eurodollar
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 Business Day: Any day on which commercial banks are open
for international business (including dealings in Dollar deposits) in the
London interbank market.
Eurodollar Lending Office: Initially, the office of the Bank, if any,
that shall be making or maintaining Eurodollar Rate Loans.
Eurodollar Rate. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (a) the arithmetic average of the rates
per annum for the Bank (rounded upwards to the nearest 1/16 of one percent) of
the rate at which the Bank's Eurodollar Lending Office is offered Dollar
deposits two Eurodollar 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 Eurodollar Rate Loan of the Bank to which such Interest Period applies,
divided by (b) a number equal to 1.00 minus the Eurocurrency Reserve Rate, if
applicable.
Eurodollar Rate Loans: Loans bearing interest calculated by reference
to the Eurodollar Rate.
Event of Default: Any of the events listed in Section 14 hereof.
Financials: With respect to any Person for any period, the
consolidated balance sheet of such Person as at the end of such period, and the
related
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consolidated statement of operations and statement of cash flows of such Person
for such period, each setting forth in comparative form the figures for the
previous comparable fiscal period, all in reasonable detail and prepared in
accordance with GAAP.
GAAP: Generally accepted accounting principles consistent with those
adopted by the Financial Accounting Standards Board and its predecessor, (a)
generally, as in effect from time to time, and (b) for purposes of determining
compliance by the Borrower with the financial covenants set forth herein, as in
effect for the fiscal year ended December 31, 1996.
Indebtedness: With respect to any Person, all obligations of such
Person, contingent and otherwise, that in accordance with GAAP should be
classified as liabilities, including without limitation (a) all debt
obligations, (b) all guarantees and (c) all liabilities in respect of bankers'
acceptances or Letters of Credit.
Interest Payment Date. (a) As to any Base Rate Loan, the last day of
each calendar quarter which includes the Drawdown Date thereof; and (b) as to
any Eurodollar Rate Loan in respect of which the Interest Period is (i) 3
months or less, the last day of such Interest Period and (ii) 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, (a) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrower in a request for a
Loan (i) for any Base Rate Loan, the last day of the calendar quarter; (ii) for
any Eurodollar Rate Loan, 1, 2, 3 or 6 months; and (b) 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 Borrower in a Conversion Request; provided that all of the
foregoing provisions relating to Interest Periods are subject to the following:
(c) if any Interest Period with respect to a Eurodollar
Rate Loan would otherwise end on a day that is not a Eurodollar Business Day,
that Interest Period shall be extended to the next succeeding Eurodollar
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 Eurodollar Business Day;
(d) 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;
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(e) if the Borrower shall fail to give notice as provided
in Section 4, the Borrower shall be deemed to have requested a conversion of
the affected Eurodollar Rate Loan to a Base Rate Loan on the last day of the
then current Interest Period with respect thereto;
(f) any Interest Period relating to any Eurodollar Rate
Loan that begins on the last Eurodollar 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 Eurodollar Business
Day of a calendar month; and
(g) any Interest Period relating to any Eurodollar Rate
Loan that would otherwise extend beyond the Maturity Date shall end on the
Maturity Date.
Loans: Any loan made or to be made to the Borrower pursuant to Section
2 hereof, including, without limitation, any Base Rate Loans or Eurodollar
Loans.
Loan Documents: This Loan Agreement, the Note, the WP Guaranty, and any
other documents, instruments or agreements executed and/or delivered in
connection with this Loan Agreement on or after the date hereof, in each case
as from time to time amended or supplemented.
Materially Adverse Effect: Any materially adverse effect on the
financial condition or business operations of the Borrower and its Subsidiaries
taken as a whole or material impairment of the ability of the Borrower or any
of its Subsidiaries to perform its obligations hereunder or under any of the
other Loan Documents, provided, that under no circumstances shall operating
losses of the Borrower and its Subsidiaries taken as a whole incurred in the
ordinary course of business constitute a Materially Adverse Effect hereunder.
Maturity Date: The earlier to occur on (a) March 31, 1999 and (b) ten
(10) Business Days prior to the "Final Maturity Date" under and as defined in
the WP Loan Agreement.
Note: See Section 2(a).
Obligations: All indebtedness, obligations and liabilities of the
Borrower to the Bank, existing on the date of this Loan 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 Loan
Agreement or any other Loan Document or in respect of any of the Loans, the
Note or other instruments at any time evidencing any thereof.
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Person: Any individual, corporation, partnership, trust,
unincorporated association, business, or other legal entity, any government or
any governmental agency or political subdivision thereof.
Requirement of Law: With respect to any Person, any law, treaty, rule,
regulation or determination of an arbitrator, court, or other governmental
authority, in each case applicable to or binding upon such Person or affecting
any of its property.
Subscription Agreements: Collectively, (a) the Put Agreement dated as
of February 2, 1996 by and between Warburg, Xxxxxx and WP and (b) any and all
documents, agreements and instruments executed in connection therewith.
Subsidiary: Any Person with respect to which the Borrower at any time
owns or controls, directly or indirectly, more than fifty percent (50%) of the
outstanding shares of stock or other equity securities or interests having
voting power, regardless of whether such right to vote depends upon the
occurrence of a contingency.
Type: As to any Loan, its nature as a Base Rate Loan or a Eurodollar
Rate Loan.
Warburg, Xxxxxx: Warburg, Xxxxxx Investors, L.P., a Delaware limited
partnership, a significant shareholder of the Borrower.
WP: WP Finance, Inc., a Delaware corporation and wholly-owned
subsidiary of Warburg, Xxxxxx.
WP Event of Default: An Event of Default under and as defined in the WP
Loan Agreement.
WP Guaranty: The Guaranty of even date herewith from WP to the Bank, as
amended from time to time.
WP Loan Agreement: The Credit Agreement dated as of August 3, 1994
among WP, The Chase Manhattan Bank, N.A. and certain lending institutions, as
amended in accordance with the terms hereof.
WP Loan Documents: The WP Loan Agreement and all documents, agreements
and instruments executed in connection therewith, in each case as amended.
2. REVOLVING CREDIT FACILITY.
(a) Upon the terms and subject to the conditions of this
Loan Agreement, the Bank agrees to make Loans to the Borrower that the Borrower
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may request from the date hereof until but not including the Maturity Date;
provided that the sum of the outstanding principal amount of all Loans (after
giving effect to all amounts requested) shall not exceed the Commitment. Loans
shall be in the minimum aggregate amount of $50,000 or an integral multiple
thereof. With respect to any Base Rate Loan, the Borrower shall notify the Bank
in writing or telephonically not later than 2:00 p.m. Hartford time on the
proposed Drawdown Date of such Base Rate Loan being requested, of the Drawdown
Date (which must be a Business Day) and the principal amount of such Base Rate
Loan. With respect to any Eurodollar Rate Loan, the Borrower shall notify the
Bank in writing, no less than three (3) Eurodollar Business Days prior to the
proposed Drawdown Date of such Eurodollar Rate Loan being requested, of the
Drawdown Date (which must be a Eurodollar Business Day), the principal amount
of such Eurodollar Rate Loan and the Interest Period for such Eurodollar Rate
Loan. Subject to the foregoing, so long as the Commitment is then in effect and
the conditions set forth in Section 12 hereof have been met, the Bank shall
advance the amount requested to the Borrower's bank account at the Bank in
immediately available funds not later than the close of business on such
Drawdown Date. The obligation of the Borrower to repay to the Bank the
principal of the Loans and interest accrued thereon shall be evidenced by a
promissory note, in the original principal amount of $15,000,000, executed and
delivered by the Borrower and payable to the order of the Bank, and in
substantially the form attached hereto as Exhibit A (the "NOTE").
(b) Subject to the terms of Section 6 hereof and the
terms of any written cash management agreements between the Bank and the
Borrower, the Borrower may elect to prepay the outstanding principal of all or
any part of any Loan, without premium or penalty, in a minimum amount of
$50,000 or an integral multiple thereof, upon written notice to the Bank given
by 2:00 p.m. Hartford time on the proposed date of such prepayment, of the
amount to be prepaid and the date of such prepayment. The Borrower shall be
entitled to reborrow before the Maturity Date such amounts, upon the terms and
subject to the conditions of this Loan Agreement. Each repayment or prepayment
of principal of any Loan shall be accompanied by payment of the unpaid interest
accrued to such date on the principal being repaid or prepaid.
(c) If at any time the outstanding principal amount of
the Loans shall exceed the Commitment, the Borrower shall, immediately upon the
Borrower's receipt of written notice of such excess, pay the amount of such
excess to the Bank for application to the Loans. The Borrower may elect to
reduce or terminate the Commitment by a minimum principal amount of $50,000 or
an integral multiple thereof, upon written notice to the Bank given by 2:00
p.m. Hartford time on the proposed date of such reduction or termination. The
Borrower shall not be entitled to reinstate all or any portion of the
Commitment following such reduction or termination.
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3. INTEREST.
(a) So long as no Event of Default is continuing, the
Borrower shall pay interest on the Loans outstanding as follows:
(i) Each Base Rate Loan shall bear interest for
the period commencing with the Drawdown Date thereof and
ending on the date such Base Rate Loan is repaid with respect
thereto at the rate of the Base Rate.
(ii) Each Eurodollar 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 the rate of one and one-half of one percent (1.5%)
per annum above the Eurodollar Rate determined for such
Interest Period.
(iii) Interest on Loans shall be payable in arrears
on each Interest Payment Date, commencing with the first such
day following the date hereof. While an Event of Default is
continuing under Section 14(a) hereof, amounts payable with
respect to any Loans shall bear interest (compounded monthly
and payable on demand in respect to overdue amounts) at a rate
per annum which is equal to (A) with respect to each Base Rate
Loan, the sum of (1) the Base Rate and (2) two percent (2.0%)
and (B) with respect to each Eurodollar Rate Loan, the sum of
(1) the Eurodollar Rate and (2) three and one- half of one
percent (3.5%), until such amount is paid in full or (as the
case may be) such Event of Default has been cured or waived in
writing by the Bank (after as well as before judgment).
4. CONVERSION OPTIONS; CONTINUATION OF LOANS.
(a) The Borrower may elect from time to time to convert
any outstanding Loan to a Loan of another Type, provided that (i) with respect
to any such conversion or extension, as the case may be, of a Loan to a Base
Rate Loan, the Borrower shall give the Bank at least three (3) Business Days'
prior written notice of such election; (ii) with respect to any such conversion
of a Eurodollar Rate Loan to a Base Rate Loan, the Borrower shall give the Bank
at least three (3) Eurodollar Business Days' prior written notice of such
election; (iii) with respect to any such conversion of a Eurodollar Rate Loan
to a Base Rate Loan, such conversion shall only be made on the last day of the
Interest Period with respect thereto; and (iv) no Loan may be converted into a
Eurodollar Rate Loan when any Default or Event of Default has occurred and is
continuing. All or any part of outstanding Loans of any Type may be converted
into a Loan of another Type as provided herein, provided that (1) any partial
conversion shall be in an aggregate principal amount of $50,000 or an integral
multiple
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thereof and (2) the Borrower may not request or elect a Eurodollar Rate Loan,
elect to convert a Base Rate Loan to a Eurodollar Rate Loan or elect to
continue a Eurodollar Rate Loan pursuant to the terms hereof if, after giving
effect thereto, there would be greater than five (5) Eurodollar Rate Loans
outstanding. Each Conversion Request relating to the conversion of a Loan to a
Eurodollar Rate Loan shall be irrevocable by the Borrower.
(b) Any Loan of any Type may be continued as a Loan of
the same Type upon the expiration of an Interest Period with respect thereto by
compliance by the Borrower with the notice provisions contained in Section
4(a); provided that no Eurodollar 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 Bank active upon the Borrower's
account have actual knowledge.
(c) Any conversion to or from Eurodollar 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 Eurodollar Rate Loans
having the same Interest Period shall not be less than $50,000 or an integral
multiple of $50,000 in excess thereof.
5. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to
the commencement of any Interest Period relating to any Eurodollar Rate Loan,
the Bank shall determine that adequate and reasonable methods do not exist for
ascertaining the Eurodollar Rate that would otherwise determine the rate of
interest to be applicable to any Eurodollar Rate Loan during any Interest
Period, the Bank shall promptly give telephonic notice (promptly confirmed in
writing) of such determination (which shall be conclusive and binding on the
Borrower) to the Borrower's treasurer or chief financial officer. In such event
(a) upon receipt of notice, the Borrower may revoke any pending request for any
Loan or Conversion Request with respect to Eurodollar Rate Loans, (b) if the
Borrower does not revoke such request or Conversion Request, the Bank shall
make, convert or continue Loans, as proposed by the Borrower, in the amount
specified in the request or the Conversion Request submitted by the Borrower,
but such Loans shall be made, converted or continued as Base Rate Loans instead
of Eurodollar Rate Loans, (c) each Eurodollar Rate Loan will automatically, on
the last day of the then current Interest Period relating thereto, become a
Base Rate Loan, and (d) the obligations of the Bank to make Eurodollar Rate
Loans shall be suspended until the Bank determines that the circumstances
giving rise to such suspension no longer exist, whereupon the Bank shall so
notify the Borrower.
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6. INDEMNITY. The Borrower agrees to indemnify Bank and to hold
Bank harmless from and against any loss, cost or expense (including loss of
anticipated profits) that the Bank may sustain or incur as a consequence of (a)
default by the Borrower in payment of the principal amount of or any interest
on any Eurodollar Rate Loans as and when due and payable, including any such
loss or expense arising from interest or fees payable by the Bank to lenders of
funds obtained by it in order to maintain the Eurodollar Rate Loans, (b)
default by the Borrower in making a borrowing or conversion after the Borrower
has given (or is deemed to have given) a request for a Loan or a Conversion
Request relating thereto in accordance with Section 4 (other than as a result
of the operation of Section 5 or Section 7 hereof) or (c) the making of any
payment of a Eurodollar 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 the
Bank to lenders of funds obtained by it in order to maintain any such Loans.
7. 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 the Bank to
make or maintain Eurodollar Rate Loans, the Bank shall forthwith give notice of
such circumstances to the Borrower and thereupon (a) the commitment of the Bank
to make Eurodollar Rate Loans or convert Loans of another Type to Eurodollar
Rate Loans shall forthwith be suspended and (b) the Bank's Loans then
outstanding as Eurodollar Rate Loans, if any, shall be converted automatically
to Base Rate Loans on the last day of each Interest Period applicable to such
Eurodollar Rate Loans or within such earlier period as may be required by law.
The Borrower hereby agrees promptly to pay the Bank upon demand, any additional
amounts necessary to compensate the Bank for any reasonable costs incurred by
the Bank in making any conversion in accordance with this Section 7, including
any interest or fees payable by the Bank to lenders of funds obtained by it in
order to make or maintain its Eurodollar Loans hereunder.
8. 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 the Bank by any central bank or other fiscal, monetary
or other authority (whether or not having the force of law), shall:
(a) subject the Bank to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this Loan
Agreement, the other Loan Documents, the Commitment or the Loans (other than
taxes based upon or measured by the income or profits of the Bank), or
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(b) materially change the basis of taxation (except for
changes in taxes on income or profits) of payments to the Bank of the principal
of or the interest on any Loans or any other amounts payable to the Bank under
this Loan 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 Loan 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, or deposits in or for the account of, or loans by, or letters of
credit issued by, or commitments of an office of the Bank, or
(d) impose on the Bank any other conditions or
requirements with respect to this Loan Agreement, the other Loan Documents, the
Loans, the Commitment, or any class of loans or commitments of which any of the
Loans or the Commitment forms a part,
and the result of any event described in clause (a), (b), (c) or (d) is
(i) to increase the cost to the Bank of making,
funding, issuing, renewing, extending or maintaining any of
the Loans or the Commitment, or
(ii) to reduce the amount of principal, interest
or other amount payable to the Bank hereunder on account of
the Commitment or any of the Loans, or
(iii) to require the Bank to make any payment or to
forego any interest or other sum payable hereunder, the amount
of which payment or foregone interest or other sum is
calculated by reference to the gross amount of any sum
receivable or deemed received by the Bank from the Borrower
hereunder,
then, and in each such case, the Borrower will, upon demand made by the Bank at
any time and from time to time and as often as the occasion therefor may arise,
pay to the Bank such additional amounts as will be necessary to compensate the
Bank for such additional cost, reduction, payment or foregone interest or other
sum.
9. CHANGES IN CIRCUMSTANCES. If any change in banking law or
regulation or the administration thereof (whether or not having the force of
law) affects the amount of capital required or expected to be maintained by the
Bank or any entity controlling it, and such amount is increased by reason of
the Commitment or the Loans, the Bank may notify the Borrower thereof. The
Borrower and the Bank shall negotiate an adjustment payable to the Bank to
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compensate for such increase. If no agreement is reached within thirty (30)
days, the Bank may increase the fees payable hereunder by the amount determined
by the Bank to be necessary to provide such compensation.
10. FEES AND PAYMENTS.
(a) The Borrower shall pay to the Bank, on the first day
of each calendar quarter hereafter, and upon the Maturity Date or the date upon
which the Commitment is no longer in effect, a commitment fee calculated at a
rate per annum which is equal to one-quarter of one percent (0.25%) of the
average daily difference by which the Commitment amount exceeds the aggregate
sum of the outstanding Loans during the preceding calendar quarter or portion
thereof.
(b) All payments to be made by the Borrower hereunder or
under any of the other Loan Documents shall be made in U.S. dollars in
immediately available funds at the Bank's office at 00 Xxxxx Xxxxxx, Xxxxxxxx,
Xxxxxxxxxxx 00000, without set-off or counterclaim and without any withholding
or deduction whatsoever. The Bank shall be entitled (but shall not be
obligated) to charge any account of the Borrower with the Bank for any sum due
and payable by the Borrower to the Bank, hereunder or under any of the other
Loan Documents. If any payment hereunder is required to be made on a day which
is not a Business Day, it shall be paid on the immediately preceding Business
Day. All computations of interest or of the closing or commitment fees payable
hereunder shall be made by the Bank on the basis of actual days elapsed and on
a 360-day year.
11. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants to the Bank on the date hereof, on the date of any request for any
Loan, and on each Drawdown Date that: (a) the Borrower and each of its
Subsidiaries is duly organized, validly existing, and in good standing under
the laws of its jurisdiction of incorporation and is duly qualified and in good
standing in every other jurisdiction where it is doing business, except where
the failure to so qualify does not have a Materially Adverse Effect, and the
execution, delivery and performance by the Borrower of the Loan Documents (i)
is within its corporate authority, (ii) has been duly authorized, (iii) does
not conflict with or contravene its Charter Documents; (b) upon execution and
delivery thereof, each Loan Document shall constitute the legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms
except as enforceability is limited by laws regarding bankruptcy or insolvency
or generally the enforcement of creditors' rights; (c) the Borrower and each
Subsidiary have good and marketable title to (or, to the best knowledge of the
Borrower after reasonable inquiry, valid licenses of) all of their respective
material properties, and possess (or to the best knowledge of the Borrower
after reasonable inquiry, have valid licenses for) all assets, including
intellectual properties, franchises and Consents, adequate for the conduct of
their respective
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businesses as now conducted, without any conflict with any rights of others;
(d) the Borrower has provided to the Bank its audited Financials as at December
31, 1996 and for the period then ended and its unaudited management prepared
Financials as at February 28, 1997, and such Financials are complete and
correct and fairly present the position of the Borrower and its Subsidiaries as
at such dates and for such periods in accordance with GAAP consistently applied
(except, in the case of unaudited Financials, with respect to the notes thereto
and year-end adjustments); (e) except as otherwise disclosed in writing to the
Bank by the Borrower, since December 31, 1996, there has been no materially
adverse change of any kind in the Borrower or any of its Subsidiaries which
would have a Materially Adverse Effect; (f) except as set forth on Schedule
11(f), there are no legal or other proceedings or investigations pending or
threatened against the Borrower, any of its Subsidiaries or WP before any
court, tribunal or regulatory authority which would, if adversely determined,
alone or together, have a Materially Adverse Effect; (g) the execution,
delivery, performance of its obligations, and exercise of its rights under the
Loan Documents by the Borrower, including borrowing under this Loan Agreement
(i) do not require any Consents; and (ii) are not and will not be in conflict
with or prohibited or prevented by (A) any Requirement of Law, or (B) any
Charter Document, corporate minute or resolution, instrument, agreement or
provision thereof, in each case binding on it or affecting any of its property
or the property of any of its Subsidiaries; (h) neither the Borrower nor any
Subsidiary is in violation of (i) any Charter Document, corporate minute or
resolution, (ii) any instrument or agreement, in each case binding on it or
affecting its property, in a manner which would have a Materially Adverse
Effect, or (iii) any Requirement of Law in a manner which would have a
Materially Adverse Effect, including, without limitation, all applicable
federal and state tax laws, ERISA and Environmental Laws; (i) except as set
forth on Schedule 11(i) hereof, the Borrower has no Subsidiaries and is not a
party to any partnership or joint venture, (j) each fiscal year of the Borrower
begins on January 1 of each calendar year and ends on December 31 of each
calendar year; and (k) both before and immediately after giving effect to the
transactions contemplated hereby, the Borrower and each of its Subsidiaries
(except for intercompany balances owed by Subsidiaries of the Borrower to the
Borrower to the extent permitted hereunder) is and shall be solvent on a going
concern basis (after taking into account the value of all tangible and
intangible assets, including without limitation goodwill, patents, trademarks,
copyrights and other intellectual property), has assets (after taking into
account the value of all tangible and intangible assets, including without
limitation goodwill, patents, trademarks, copyrights and other intellectual
property) having a fair value in excess of the amount required to pay its
probable liabilities on its existing debts as they become absolute and matured,
and has, and will have, access to adequate capital (including the Commitment)
(i) for the conduct of its business and (ii) to pay its debts from time to time
incurred in connection therewith as such debts mature.
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12. CONDITIONS PRECEDENT. In addition to the making of the
foregoing representations and warranties and the delivery of the Loan Documents
and such other documents and the taking of such actions as the Bank may require
at or prior to the time of executing this Loan Agreement, the obligation of the
Bank to make any Loan to the Borrower hereunder is subject to the satisfaction
of the following further conditions precedent: (a) each of the representations
and warranties of the Borrower and WP to the Bank shall be true and correct in
all material respects as of the time made or claimed to have been made; (b) no
Default or Event of Default shall be continuing; (c) all proceedings in
connection with the transactions contemplated hereby shall be in form and
substance reasonably satisfactory to the Bank, and the Bank shall have received
all information and documents as it may have reasonably requested; (d) no WP
Event of Default shall be continuing; (e) the Subscription Agreements shall be
in full force and effect; and (f) WP shall have Availability of not less than
the aggregate amount of all Contingent Obligations (under and as defined in the
WP Loan Agreement on the date hereof without regard to any future amendment or
modification thereof).
13. COVENANTS.
(a) The Borrower agrees that as long as any Loan or the
Note is outstanding and until the termination of the Commitment and the payment
and satisfaction in full of the Loans and all of the other Obligations, the
Borrower will, and where applicable, will cause each of its Subsidiaries to
comply with its obligations as set forth throughout this Loan Agreement and to:
(i) furnish the Bank: (A) within five (5)
Business Days of the filing or mailing thereof, copies of
financial statements, reports and proxy statements filed with
the Securities and Exchange Commission (or any successor
thereto) or any national securities exchange by the Borrower
or sent to the stockholders of the Borrower, including,
without limitation, copies of all registration statements and
Forms 10-K, 10-Q and amendments thereto; and (B) together with
such quarterly and annual financial information, a certificate
of the Borrower setting forth computations demonstrating
compliance with the Borrower's financial covenants set forth
herein, and certifying that no Default or Event of Default has
occurred, or if a Default or an Event of Default has occurred,
the actions taken by the Borrower with respect thereto;
(ii) keep true and accurate books of account in
accordance with GAAP and, upon reasonable prior notice and at
reasonable intervals (unless a Default or an Event of Default
shall be continuing, whereupon such notice shall not be
required), to permit the Bank or its designated
representatives (at the expense of the
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Borrower if a Default or Event of Default has occurred and is
continuing and at the expense of the Bank at all other times),
to inspect the Borrower's premises, activities, books and
records, to examine and be advised as to such or other
business records upon the request of the Bank and cause
Borrower's officers and employees to give full cooperation and
assistance in connection therewith;
(iii) maintain the Borrower's corporate existence,
business and assets, to keep its business and assets
adequately insured, to maintain its chief executive office in
the United States, to continue to engage in substantially the
same lines of business or businesses related thereto, and to
comply in all material respects with all Requirements of Law,
including ERISA and Environmental Laws;
(iv) notify the Bank promptly in writing (A) of
the occurrence of any Default or Event of Default, (B) of any
noncompliance with ERISA or any Environmental Law or
proceeding in respect thereof which could have a Materially
Adverse Effect, (C) of any change of address or name of the
Borrower, (D) of any threatened or pending litigation or
similar proceeding affecting the Borrower or any of its
Subsidiaries involving claims in excess of $500,000 in the
aggregate or any material change in any such litigation or
proceeding previously reported, or (E) of claims in excess of
$500,000 in the aggregate against any assets or properties of
the Borrower or any of its Subsidiaries;
(v) use the proceeds of the Loans only for
working capital purposes, and not for the purchasing or
carrying of "margin security" or "margin stock" within the
meaning of Regulations U and X of the Board of Governors of
the Federal Reserve System, 12 C.F.R. Parts 221 and 224; and
(vi) cooperate with the Bank, take such action,
execute such documents, and provide such information as the
Bank may from time to time reasonably request in order further
to effect the transactions contemplated by and the purposes of
the Loan Documents.
(b) The Borrower agrees that as long as any Loan or the
Note is outstanding and until the termination of the Commitment and the payment
and satisfaction in full of the Loans and all of the Obligations, the Borrower
will not, and where applicable, will not permit any or its Subsidiaries to:
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(i) make any investments other than investments
in (A) marketable obligations of the United States maturing
within one (1) year, (B) certificates of deposit, bankers'
acceptances and time and demand deposits of United States
banks having total assets in excess of $1,000,000,000, (C)
investments that are consistent with the investment guidelines
attached hereto as Schedule 13(b)(i), (D) investments in
Subsidiaries of the Borrower in an aggregate amount not to
exceed (1) during the period commencing on the Closing Date
through the first anniversary date of the Closing Date,
$30,000,000 at any time and (2) thereafter, $32,500,000
(measured on a cumulative basis) at any time, or (E) such
other investments as the Bank may from time to time approve in
writing;
(ii) make any Distributions of any nature
whatsoever without the prior written consent of the Bank;
(iii) (A) become party to a merger or consolidation
(other than a merger of a Subsidiary of the Borrower with and
into the Borrower upon thirty (30) days' prior written notice
to Bank), (B) make any change in Borrower's corporate
structure or identity which has a Materially Adverse Effect;
or (C) enter into any agreement to do any of the foregoing; or
(iv) change its or any of its Subsidiaries fiscal
year without the prior written consent of the Bank.
(c) The Borrower agrees that as long as any Loan or Note
is outstanding and until the termination of the Commitment and the payment and
satisfaction in full of all of the Obligations, the Borrower will not:
(i) permit the Consolidated Shareholders' Equity
to be less than $50,000,000 at any time; or
(ii) permit the ratio of Consolidated Current
Assets to Consolidated Current Liabilities (excluding the
outstanding principal amount of the Loans) to be less than
1.25 to 1.00 at any time.
14. EVENTS OF DEFAULT; ACCELERATION. If any of the following
events ("EVENTS OF DEFAULT") shall occur: (a) the Borrower shall fail to pay
within five (5) days of when due and payable any interest on the Loans or any
other sum due under any of the Loan Documents when the same becomes due; (b)
the Borrower shall fail to pay when due and payable any principal on the Loans
when the same becomes due; (c) the Borrower shall fail to perform any term,
covenant or agreement contained in Section 13(c) hereof; (d) the Borrower shall
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fail to perform any term, covenant or agreement contained in Section 13(b)
hereof and such failure shall continue for five (5) days after its occurrence;
(e) WP shall fail to comply with any term or condition set forth in its
Guaranty or such Guaranty shall cease to be in full force and effect without
the prior written consent of the Bank (except if the Obligations have been paid
in full in cash and the Commitment has terminated); (f) the Borrower or any of
its Subsidiaries or WP shall fail to perform any other term, covenant or
agreement contained in the Loan Documents within thirty (30) days after the
Bank has given written notice of such failure to the Borrower; (g) any
representation or warranty of the Borrower, any of its Subsidiaries or WP in
the Loan Documents or in any certificate or notice given in connection
therewith shall have been false or misleading in any material respect at the
time made or deemed to have been made; (h) the Borrower, any of its
Subsidiaries or WP shall fail to pay when due or within any applicable period
of grace any Indebtedness owing to the Bank or any affiliates of the Bank or
any other Indebtedness for borrowed money to any other third party in an
aggregate principal amount greater than $500,000; (i) any of the Loan Documents
shall cease to be in full force and effect, (j) the Borrower, any of its
Subsidiaries or WP (i) shall make an assignment for the benefit of creditors,
(ii) shall be adjudicated bankrupt or insolvent, (iii) shall seek the
appointment of, or be the subject of an order appointing, a trustee, liquidator
or receiver as to all or part of its assets, (iv) shall commence, approve or
consent to, any case or proceeding under any bankruptcy, reorganization or
similar law and, in the case of an involuntary case or proceeding, such case or
proceeding is not dismissed within forty-five (45) days following the
commencement thereof, or (v) shall be the subject of an order for relief in an
involuntary case under federal bankruptcy law; (k) the Borrower, any of its
Subsidiaries or WP shall be unable to pay debts as they mature; (l) there shall
remain undischarged for more than thirty (30) days any final judgment or
execution action against the Borrower, any of its Subsidiaries or WP that,
together with other outstanding claims and execution actions against the
Borrower, such Subsidiary or WP, exceeds $250,000 in the aggregate; (m) a WP
Event of Default shall have occurred and be continuing; (n) any of the
Subscription Agreements shall terminate or cease to be in full force and
effect; or (o) the Availability under the WP Loan Agreement shall be less than
one hundred percent (100%) of all Contingent Obligations (as defined in the WP
Loan Agreement on the date hereof without regard to any future amendment or
modification thereof) of WP outstanding at any time;
THEN, or at any time thereafter:
1. In the case of any Event of Default under clause (j) or (k),
the Commitment shall automatically terminate, and the entire unpaid principal
amount of the Loans, all interest accrued and unpaid thereon, and all other
amounts payable hereunder and under the other Loan Documents shall
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automatically become forthwith due and payable, without presentment, demand,
protest or notice of any kind, all of which are hereby expressly waived by the
Borrower; and
2. In the case of any Event of Default other than (j) and (k),
the Bank may, by written notice to the Borrower, terminate the Commitment
and/or declare the unpaid principal amount of the Loans, all interest accrued
and unpaid thereof, and all other amounts payable hereunder and under the other
Loan Documents to be forthwith due and payable, without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived
by the Borrower.
No remedy herein conferred upon the Bank is intended to be exclusive
of any other remedy and each and every remedy shall be cumulative and in
addition to every other remedy hereunder, now or hereafter existing at law or
in equity or otherwise.
15. SETOFF. Regardless of the adequacy of any collateral for the
Obligations, any deposits or other sums credited by or due from the Bank to the
Borrower may be applied to or set off against any principal, interest and any
other amounts due from the Borrower to the Bank at any time without notice to
the Borrower, or compliance with any other procedure imposed by statute or
otherwise, all of which are hereby expressly waived by the Borrower.
16. MISCELLANEOUS. The Borrower agrees to indemnify and hold
harmless the Bank against all claims and losses of every kind arising out of
the Loan Documents, including without limitation against those in respect of
the application of Environmental Laws to the Borrower and its Subsidiaries;
provided, however, Borrower shall not be obligated to indemnify the Bank from,
and hold it harmless against, any such claims or losses arising out of the
gross negligence or willful misconduct of the Bank. The Borrower shall pay to
the Bank promptly on demand all reasonable costs and expenses (including any
taxes and legal and other professional fees and fees of its commercial finance
examiner) incurred by the Bank in connection with the preparation, negotiation,
execution, amendment, administration or enforcement of any of the Loan
Documents. Any communication to be made hereunder shall (i) be made in writing,
but unless otherwise stated, may be made by telex, facsimile transmission or
letter, and (ii) be made or delivered to the address of the party receiving
notice which is identified with its signature below (unless such party has by
five (5) days' written notice specified another address), and shall be deemed
made or delivered the next Business Day after dispatched, or left at that
address, or five (5) days after being mailed, postage prepaid, to such address.
This Loan Agreement shall be binding upon and inure to the benefit of each
party hereto and its successors and assigns, but the Borrower may not assign
its rights or obligations hereunder. This Loan Agreement may not be amended or
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waived except by a written instrument signed by the Borrower and the Bank, and
any such amendment or waiver shall be effective only for the specific purpose
given. No failure or delay by the Bank to exercise any right hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any
right, power or privilege preclude any other right, power or privilege. The
provisions of this Loan Agreement are severable and if any one provision hereof
shall be held invalid or unenforceable in whole or in part in any jurisdiction,
such invalidity or unenforceability shall affect only such provision in such
jurisdiction. This Loan Agreement, together with all Exhibits and Schedules
hereto, expresses the entire understanding of the parties with respect to the
transactions contemplated hereby. This Loan Agreement and any amendment hereby
may be executed in several counterparts, each of which shall be an original,
and all of which shall constitute one agreement. In proving this Loan
Agreement, it shall not be necessary to produce more than one such counterpart
executed by the party to be charged. THIS LOAN AGREEMENT AND THE NOTE ARE
CONTRACTS UNDER THE LAWS OF THE STATE OF CONNECTICUT AND SHALL BE CONSTRUED IN
ACCORDANCE THEREWITH AND GOVERNED THEREBY. THE BORROWER AGREES THAT ANY SUIT
FOR THE ENFORCEMENT OF ANY OF THE LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS
OF THE STATE OF CONNECTICUT OR ANY FEDERAL COURT SITTING THEREIN. The Borrower,
as an inducement to the Bank to enter into this Loan Agreement, hereby waives
its right to a jury trial with respect to any action arising in connection with
any Loan Document.
17. PREJUDGMENT REMEDY WAIVER. THE BORROWER ACKNOWLEDGES THAT
THE FINANCING EVIDENCED HEREBY IS A COMMERCIAL TRANSACTION WITHIN THE MEANING
OF CHAPTER 903a OF THE CONNECTICUT GENERAL STATUTES. THE BORROWER HEREBY WAIVES
ITS RIGHT TO NOTICE AND PRIOR COURT HEARING OR COURT ORDER UNDER CONNECTICUT
GENERAL STATUTES SECTIONS 52-278a ET. SEQ. AS AMENDED OR UNDER ANY OTHER STATE
OR FEDERAL LAW WITH RESPECT TO ANY AND ALL PREJUDGMENT REMEDIES THE BANK MAY
EMPLOY TO ENFORCE ITS RIGHTS AND REMEDIES HEREUNDER. MORE SPECIFICALLY, THE
BORROWER ACKNOWLEDGES THAT THE BANK'S ATTORNEY MAY, PURSUANT TO CONN. GEN.
STAT. Section 52-278F, ISSUE A WRIT FOR A PREJUDGMENT REMEDY WITHOUT SECURING A
COURT ORDER. THE BORROWER ACKNOWLEDGES AND RESERVES ITS RIGHT TO NOTICE AND A
HEARING SUBSEQUENT TO THE ISSUANCE OF A WRIT FOR PREJUDGMENT REMEDY AS
AFORESAID AND THE BANK ACKNOWLEDGES THE BORROWER'S RIGHT TO SAID HEARING
SUBSEQUENT TO THE ISSUANCE OF SAID WRIT.
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18. CONFIDENTIALITY. The Bank agrees to take normal and
reasonable precautions and exercise due care to maintain the confidentiality of
all information identified as "confidential" or "secret" by the Borrower and
provided to it by the Borrower or any of its Subsidiaries under this Loan
Agreement or any of other Loan Document, and the Bank shall not use any such
information other than in connection with or in the administration or
enforcement of this Loan Agreement and the other Loan Documents, except to the
extent such information (i) was or becomes generally available to the public
other than as a result of disclosure by the Bank, (ii) was or becomes available
on a non-confidential basis from a source other than the Borrower; provided,
that such source is not bound by a confidentiality agreement with the Borrower
known to the officers of the Bank handling the transaction contemplated hereby;
and provided, further, that the Bank may disclose such information (A) at the
request or pursuant to any requirement of any governmental authority or
regulator to which the Bank is subject or in connection with an examination of
the Bank by any such authority or regulator, (B) pursuant to subpoena or other
court process, (C) when required to do so in accordance with the provisions of
any applicable law, (D) to the extent reasonably required in connection with
any
[Intentionally Left Blank]
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litigation or proceeding to which the Bank may be party, (E) to the extent
reasonably required in connection with the exercise of any remedy hereunder or
under any other Loan Document, (F) to the Bank's independent auditors,
attorneys, accountants and other professional advisors, (G) to any affiliate of
the Bank provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Bank hereunder and (H) in
accordance with Xxxxxx Xxxxxx Associates guidelines.
IN WITNESS WHEREOF, the undersigned have duly executed this Loan
Agreement as of the date first above written.
NEXSTAR PHARMACEUTICALS, INC.
/s/ XXXXXXX X. XXXX
By: /s/ XXXXXXX X. XXXXXXX
-----------------------------------
0000 Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
BANK OF BOSTON CONNECTICUT
By: /s/ XXXXX XXXXXXX
-----------------------------------
Xxxxx Xxxxxxx
Its Vice President
00 Xxxx Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
