EXHIBIT 4.1
AMENDED AND RESTATED CREDIT FACILITY AGREEMENT
THIS AGREEMENT is made as of the 12th day of July, 2005 by and among
XXXXXX CORPORATION, a corporation formed under the laws of the State of Delaware
with offices at 00 Xxxxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxx 00000, and BANK OF
AMERICA, N.A., successor by merger to Fleet National Bank, a national banking
association organized and existing under the laws of the United States of
America, having an office at Xxx Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000.
The parties hereby agree as follows:
ARTICLE 1 - DEFINITIONS
1.1 The following terms shall have the following meanings unless otherwise
expressly stated herein:
"Affiliate" shall mean any entity which directly or indirectly, or
through one or more intermediaries, Controls or is Controlled By or is Under
Common Control with the Borrower.
"Applicable LIBOR Margin" shall mean the following amounts for the
following respective ratios of Total Liabilities to Tangible Net Worth,
calculated for the Borrower on a consolidated basis and without duplication in
accordance with GAAP:
MARGIN
LEVERAGE RATIO (BASIS POINTS)
>1.50 to 1.0 L+200
< or = 1.50 to 1.0 L+150
< or = 1.25 to 1.0 L+125
< or = 1.00 to 1.0 L+100
The Applicable LIBOR Margin shall be adjusted on the first day of
the month following the date on which the Bank receives the Borrower's quarterly
or annual, as the case may be, consolidated financial statements pursuant to
Section 9.1 of this Agreement, and shall be based upon the average rolling four
fiscal quarter ratios shown by such financial statements.
"Applicable Prime Rate Margin" shall mean the following amounts for
the following respective ratios of Total Liabilities to Tangible Net Worth,
calculated for the Borrower on a consolidated basis and without duplication in
accordance with GAAP:
MARGIN
LEVERAGE RATIO (PERCENTAGE)
> 1.50 to 1.0 P-0.25%
< or = 1.50 to 1.0 P-0.50%
< or = 1.25 to 1.0 P-0.75%
< or = 1.00 to 1.0 P-1.00%
The Applicable Prime Rate Margin shall be adjusted on the first day
of the month following the date on which the Bank receives the Borrower's
quarterly or annual, as the case may be, consolidated financial statements
pursuant to Section 9.1 of this Agreement, and shall be based upon the average
rolling four fiscal quarter ratios shown by such financial statements.
"Bank" shall mean Bank of America, N.A., and its successors, legal
representatives, and assigns.
"Benefit Plan" of any Person, means, at any time, any employee
benefit plan (including a Multiemployer Plan), the funding requirements of which
(under Section 302 of ERISA or Section 412 of the Code) are, or at any time
within six years immediately preceding the time in question were, in whole or in
part, the responsibility of such Person.
"Borrower" shall mean Xxxxxx Corporation and its successors, legal
representatives, and assigns.
"Break Costs" shall mean such amount or amounts as shall be
sufficient (in the reasonable opinion of the Bank) to compensate it for any
loss, cost, or expense incurred as a result of (i) any payment of any Obligation
bearing a rate based upon the LIBOR Rate other than on the last day of the
applicable LIBOR Interest Period for such Obligation, (ii) any failure by
Borrower to borrow an Obligation on the date specified in Borrower's written
notice of intention to borrow such Obligation at a rate based upon the LIBOR
Rate, (iii) any failure by Borrower to pay an Obligation bearing a rate based
upon the LIBOR Rate on any date for payment specified in Borrower's written
notice of intention to pay such Obligation. Without limiting the foregoing, the
Borrower shall pay to the Bank a "yield maintenance fee" as part of Break Costs
in an amount computed as follows: The current rate for United States Treasury
securities (bills on a discounted basis shall be converted to a bond equivalent)
with a maturity date closest to the last day of the applicable LIBOR Interest
Period of the particular Obligation as to which the prepayment is made shall be
subtracted from the LIBOR in effect at the time of prepayment. If the result is
zero or a negative number, there shall be no yield maintenance fee. If the
result is a positive number, then the resulting percentage shall be multiplied
by the amount of the principal balance being prepaid. The resulting amount shall
be divided by 360 and multiplied by the number of days remaining until the end
of the respective applicable LIBOR Interest Period. Said amount shall be reduced
to present value calculated by using the above-referenced United States Treasury
securities rate and the number of days remaining until the last day of the
respective applicable LIBOR Interest Period. The resulting amount shall be the
yield maintenance fee due to Bank upon prepayment of the respective Obligation.
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"Business Day" shall mean a day on which commercial banks settle
payments in New York, or London Banking Day if the payment obligation is
calculated by reference to any LIBOR Rate.
"Controlled Group" means a controlled group of corporations of which
the Borrower is a member within the meaning of Section 414(b) of the Code, any
group of corporations or entities under common control with the Borrower within
the meaning of Section 414(c) of the Code or any affiliated service group of
which the Borrower is a member within the meaning of Section 414(m) of the Code.
"Controlled Group Member" means each trade or business (whether or
not incorporated) which is a member of a Controlled Group.
"Controls" (including the terms "Controlled By" or "Under Common
Control") shall mean but not be limited to the ownership of ten percent (10%) or
more of the outstanding shares of capital stock of any corporation having voting
power for the election of directors, whether or not at the same time stock of
any other class or classes has or might have voting power by reason of the
happening of any contingency, or ownership of ten percent (10%) or more of any
interest in any partnership, or any other interest by reason of which a
controlling influence over the affairs of the entity may be exercised.
"Conversion Date" shall mean the date on which an amount outstanding
under the Revolving Line is converted to a Term Loan in accordance with Section
4.1 hereof.
"Debt" for any Person shall mean (i) indebtedness of such Person for
borrowed money, (ii) obligations of such Person for the deferred purchase price
of property or services (except trade payables incurred in the ordinary course
of business), (iii) capitalized or capitalizable obligations of such Person with
respect to leases, (iv) the amount available for drawing under outstanding
standby letters of credit issued for the account of such Person and the amount
of other off-balance sheet obligations or liabilities, each to the extent not
otherwise treated separately as Debt, (v) all obligations endorsed (other than
for collection in the ordinary course of business) or guaranteed by such Person
directly or indirectly in any manner including without limitation contingent
obligations to purchase, pay or supply funds to any Person to assure a creditor
against loss, (vi) obligations of such Person arising under acceptance
facilities, (vii) obligations under Rate Management Transactions (but for
purposes of calculation of covenants contained in Section 11 hereof, not
benefits related to Rate Management Transactions), (viii) obligations secured by
a lien, security interest, or other arrangement for the purpose of security on
property owned by such Person whether or not the underlying obligations have
been assumed by such Person, and (ix) any obligation of such Person to a
Multi-Employer Plan which constitutes a liability under GAAP.
"Debt Service Coverage Ratio" shall mean the ratio of (a) EBITDA to
(b) interest expense and current maturities of long term debt.
"Debt To Worth Ratio" shall mean Total Liabilities compared to
Tangible Net Worth, as determined by GAAP.
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"Default" shall mean any event, action, inaction, or occurrence that
with the giving of notice or passage of time would constitute an Event of
Default.
"Distributions" shall mean (i) dividends, payments, or distributions
of any kind (including without limitation cash or property) in respect of the
capital stock, securities or other equity interests or rights to acquire such
equity interests of the applicable entity except distributions in the form of
such stock, equity securities, equity interests, or rights to acquire equity
interests, and (ii) repurchases, redemptions, or acquisitions of capital stock,
securities, or other equity interests or rights to acquire such equity
interests.
"EBITDA" shall mean, for any period and determined in accordance
with GAAP, Net Income (calculated before Interest Expense, provision for taxes,
depreciation and amortization of intangibles).
"Environment" means any water including but not limited to surface
water and ground water or water vapor; any land including land surface or
subsurface; stream sediments; air; fish; wildlife; plants; and all other natural
resources or environmental media.
"Environmental Laws" means all federal, state and local
environmental, land use, zoning, health, chemical use, safety and sanitation
laws, statutes, ordinances, regulations, codes and rules relating to the
protection of the Environment and/or governing the use, storage, treatment,
generation, transportation, processing, handling, production or disposal of
Hazardous Substances and the regulations, rules, ordinances, bylaws, policies,
guidelines, procedures, interpretations, decisions, orders and directives of
federal, state and local governmental agencies and authorities with respect
thereto.
"Environmental Permits" means all licenses, permits, approvals,
authorizations, consents or registrations required by any applicable
Environmental Laws and all applicable judicial and administrative orders in
connection with ownership, lease, purchase, transfer, closure, use and/or
operation of the Improvements and/or as may be required for the storage,
treatment, generation, transportation, processing, handling, production or
disposal of Hazardous Substances.
"Environmental Report" means written reports, if any, prepared for
the Bank by an environmental consulting or environmental engineering firm.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and any successor statute of similar import and regulations
thereunder, as in effect from time to time. References to sections of ERISA
shall be construed also to refer to any successor sections.
"ERISA Title IV Liability Event" means the occurrence of any one or
more of the following events with respect to a Pension Plan subject to Title IV
of ERISA: (a) the termination of the plan or the filing with the PBGC or
delivery to affected parties of a notice of intent to terminate the plan; (b)
the institution by the PBGC of proceedings to terminate the plan under Section
4042 of ERISA or the occurrence or existence of any event or condition that
constitutes grounds for the PBGC to do so; (c) the occurrence of a Reportable
Event; (d) the termination of a plan that is a Multiple Employer Plan or the
withdrawal by the Borrower or a Controlled Group Member from a plan that is a
Multiple Employer Plan under which the Borrower or a Controlled Group
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Member was a substantial employer (within the meaning of Sections 4001(a)(2) and
4063 of ERISA); (e) the cessation of operations by the Borrower or a Controlled
Group Member at a facility resulting in an event described in Section 4062(e) of
ERISA with respect to the plan; or (f) the termination of a plan within five
years of participation by the Borrower or a Controlled Group Member in a
transaction that could be characterized under Section 4069(a) of ERISA as having
as a principal purpose the evasion of liability under Title IV of ERISA with
respect to the plan.
"Event of Default" shall mean the occurrence of any event described
in Article 12 hereof.
"Forfeiture Action" shall mean any action, including investigations,
hearings, and other legal proceedings, before any court, tribunal, commission,
or governmental authority, agency, or instrumentality, whether domestic or
foreign, that may result in seizure of any property or asset.
"GAAP" shall mean generally accepted accounting principles.
"Hazardous Substances" means, without limitation, any explosives,
radon, radioactive materials, asbestos, urea formaldehyde foam insulation,
polychlorinated biphenyls, petroleum and petroleum products, methane, hazardous
materials, hazardous wastes, hazardous or toxic substances and any other
material defined as a hazardous substance in the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Sections
9601, et. seq.; the Hazardous Materials Transportation Act, as amended, 49
U.S.C. Sections 1801, et. seq.; the Resource Conservation and Recovery Act, as
amended, 42 U.S.C. Sections 6901, et. seq.; Articles 15 and 27 of the New York
State Environmental Conservation Law or any other federal, state, or local law,
regulation, rule, ordinance, bylaw, policy, guideline, procedure,
interpretation, decision, order, or directive, whether existing as of the date
hereof, previously enforced or subsequently enacted.
"Improvements" shall mean any real property owned or used by the
Borrower.
"Increased Cost" shall mean any additional amounts sufficient to
compensate the Bank for any increased costs of funding or maintaining the
Obligations as a result of the adoption after the date of this Agreement of any
law (other than changes in tax laws imposed on the overall net income or similar
measure of profitability of the Banks) or guideline after the date of this
Agreement regarding capital adequacy, or any change in any of the foregoing or
in the interpretation or administration of any of the foregoing by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by the Bank or its
Affiliates, with any request or directive regarding capital adequacy (whether or
not having the force of law) of any such authority, central bank or comparable
agency, which has or would have the effect of reducing the rate of return on the
Bank's capital or on the capital of the Bank's Affiliates as a direct
consequence of the transactions contemplated by this Agreement and the Loan
Documents, the existence of the Bank's commitments hereunder, or the Obligations
to a level below that which the Bank or the Bank's Affiliates
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would have achieved but for such adoption, change or compliance (taking into
consideration the Bank's policies on capital adequacy).
"Interest Expense" shall mean for the applicable period, all
interest expense shown on the consolidated financial statements delivered
pursuant to Section 9.1 of this Agreement.
"IRC" means the Internal Revenue Code of 1986, as amended, and any
reference to any particular IRC section shall be interpreted to include any
revision of or successor to that section regardless of how numbered or
classified.
"Letter of Credit" shall mean a Letter of Credit described in
Article 3 of this Agreement.
"LIBOR" shall mean the rate per annum as determined on the basis of
the offered rates for deposits in United States Dollars, for a period of time
comparable to the applicable LIBOR Interest Period which appears on the Telerate
Page 3750 as of 11:00 a.m. London time on the day that is two London Banking
Days preceding the first day of the applicable LIBOR Interest Period (the
"Interest Setting Date"); provided, however, if the rate described above does
not appear on the Telerate System on any applicable Interest Setting Date, the
LIBOR rate shall be the rate (rounded upward, if necessary, to the nearest one
hundred-thousandth of a percentage point) determined on the basis of the offered
rates for deposits in United States Dollars for a the applicable LIBOR Interest
Period which are offered by four major banks in the London interbank market at
approximately 11:00 a.m. London Time, on the day that is two (2) London Banking
Days preceding the first day of such LIBOR Interest Period as selected by the
Bank. The principal London office of each of the four major London banks will be
requested to provide a quotation of its United States Dollar deposit offered
rate. If at least two such quotations are provided, the rate for that date will
be the arithmetic mean of the quotations. If fewer than two quotations are
provided as requested, the rate for that date will be determined on the basis of
the rates quoted for loans in United States Dollars to leading European banks
for a period of time comparable to the applicable LIBOR Interest Period offered
by major banks in New York City at approximately 11:00 a.m. New York City time,
on the day that is two (2) London Banking Days preceding the first day of such
LIBOR Interest Period. In the event that the Bank is unable to obtain any such
quotation as provided above, it will be deemed that LIBOR for the LIBOR Interest
Period cannot be determined.
In the event that LIBOR cannot be determined, or there is any change
in any law or application thereof that makes it unlawful, or any central bank or
other governmental authority asserts that it is unlawful, for the Bank to hold
obligations if the rate is determined with reference to the LIBOR, the Borrower
shall not be entitled to elect an interest rate based upon the LIBOR Rate until
LIBOR can again be determined or is lawful.
"LIBOR Interest Period" shall mean any particular one-month,
two-month, or three-month period during which an applicable LIBOR Rate shall be
in effect. If any LIBOR Interest Period would otherwise end on a day that is not
a London Banking Day, such Interest Period shall be extended to the next
succeeding London Banking Day unless the result of such extension would be to
carry such LIBOR Interest Period into another calendar month in which
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event such LIBOR Interest Period shall end on the immediately preceding London
Banking Day. Any LIBOR Interest Period that begins on a day for which there is
no numerically corresponding day in the calendar month at the end of such LIBOR
Interest Period shall end on the last London Banking Day of a calendar month.
"LIBOR Rate" shall mean, with respect to any LIBOR Interest Period,
the rate per annum equal to LIBOR, further adjusted to reflect any Increased
Cost. In the event that the Board of Governors of the Federal Reserve System
shall impose a Reserve Percentage (defined below) with respect to LIBOR deposits
of the Bank, then for any period during which the Reserve Percentage shall
apply, LIBOR shall be equal to the amount determined above divided by an amount
equal to 1 minus the Reserve Percentage. "Reserve Percentage" shall mean the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal, and other reserves) which is imposed on member banks of the Federal
Reserve System against "Euro-currency Liabilities as defined in Regulation D.
"Loan Documents" shall mean all notes, instruments, security
agreements, assignments, pledges, mortgages, guarantees, and other documents and
agreements of any kind or nature related to this Agreement or the Obligations
(including without limitation guarantees, security agreements, and the like
previously given in favor of the Bank which by their terms apply to or secure
both present and future obligations).
"London Banking Day" shall mean any date on which dealings in United
States Dollar deposits are carried on in the London interbank market and
commercial banks are open for business in London.
"Material Adverse Effect" shall mean a material adverse effect on
(i) the property, business, operations, financial condition, prospects,
liabilities, or capitalization of the Borrower, (ii) the legality, validity or
unenforceability of, or the legal ability of the Borrower to perform its
obligations under, this Agreement or any of the Loan Documents, (iii) the
financial capacity of the Borrower to perform any of its obligations under this
Agreement or any of the Loan Documents, (iv) the rights and remedies of the Bank
under this Agreement or any of the Loan Documents, or (v) the perfection or
priority of any security interest or lien held by the Bank.
"Multiemployer Plan" shall mean a collectively bargained plan to
which more than one employer contributes.
"Multiple Employer Plan" shall mean a plan maintained by more than
one employer, but which is not maintained under a collective bargaining
agreement, under which contributions of any participating employer are available
to pay the benefits of any participant, even if employed by another employer."
"Net Income" for any period shall mean the gross revenues for such
period less all expenses and other proper charges, determined in accordance with
GAAP consistently applied, but excluding in any event:
(a) any gains or losses (not in the ordinary course of business) on
the sale or other disposition of investments or fixed or capital assets,
and any taxes on such excluded gains and any tax deductions or credits on
account of any such excluded losses;
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(b) the proceeds of any life insurance policy;
(c) net earnings and losses of any corporation substantially all the
assets of which have been acquired in any manner, realized by such other
corporation prior to the date of such acquisition;
(d) net earnings and losses of any corporation for periods with
which the Borrower shall have consolidated or which shall have merged into
or with the Borrower, prior to the date of such consolidation or merger;
(e) net earnings of any business entity in which the Borrower has an
ownership interest unless such net earnings shall have actually been
received by the Borrower in the form of cash distributions; provided
however, that net income shall include the earnings of consolidated
subsidiaries;
(f) earnings resulting from any reappraisal, revaluation or write-up
of assets;
(g) any gain arising from the acquisition of any securities of the
Borrower;
(h) any reversal of any contingency reserve, except to the extent
that provision for such contingency reserve shall have been made from
income arising during such period;
(i) amortization of negative good will net of good will,
(j) income or loss attributable to equity in Affiliates, and
(k) other extraordinary or unusual items but excluding contract
cancellation fees and other related items in the ordinary course of
business.
"Obligations" shall include all of the Borrower's obligations to the
Bank or any Affiliate of the Bank of any kind or nature, arising now or in the
future, including without limitation obligations under or related to this
Agreement, the Revolving Line Note, any Reimbursement Agreement, any Term Loan
Note, the Loan Documents, overdrafts, automated transfer transactions,
electronic funds transfers, Rate Management Transactions, and other transactions
related to Borrower's dealings with Bank or its Affiliates.
"PBGC" means the Pension Benefit Guaranty Corporation established
under Title IV of ERISA or any other governmental agency, department or
instrumentality succeeding to the functions of the said corporation.
"Pension Plan" means any employee pension benefit plan (other than a
Multiemployer Plan) as defined in Section 3(2) of ERISA maintained for employees
of the Borrower or any Controlled Group Member or to which the Borrower or any
Controlled Group Member made, or was required to make, contributions at any time
within the preceding six years.
"Person" shall mean any individual, sole proprietorship, or other
entity of any kind or nature including without limitation any corporation,
partnership, trust, unincorporated
8
organization, limited liability company, mutual company, joint stock company,
estate, union, employee organization, government or any agency or political
subdivision thereof.
"Plan" (i) with respect to each Related Party, an employee benefit
plan (as defined in Section 3(3) of ERISA) which a Related Party sponsors or
maintains or to which a Related Party may have liability (other than a
Multiemployer Plan) and (ii) with respect to any Controlled Group member (other
than a Related Party), an employee benefit plan (as defined in Section 3(3) of
ERISA) subject to Title IV of ERISA, including but not limited to any defined
benefit pension plans subject to Section 412 of the IRC which such member of the
Controlled Group sponsors or maintains or to which such member of the Controlled
Group may have liability (other than a Multiemployer Plan).
"Prime Rate" shall mean the variable per annum rate of interest so
designated from time to time by the Bank as its prime rate. The Prime Rate is a
reference rate and does not necessarily represent the lowest or best rate being
charged to any customer. Changes in the rate of interest resulting from changes
in the Prime Rate shall take place immediately without notice or demand of any
kind.
"Prohibited Transaction" has the meaning set forth in Section 406 of
ERISA or Section 4975 of the Code.
"Qualified Plan" means a Plan which is intended to be, or has ever
been treated as, tax-qualified under IRC Section 401(a).
"Rate Change Date" shall mean the first day of each one- month,
two-month, or three-month LIBOR Interest Period.
"Rate Management Transaction" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered into by
Borrower which is a rate swap, basis swap, forward rate transaction, commodity
swap, commodity option, equity or equity index swap, equity or equity index
option, bond option, interest rate option, foreign exchange transaction, cap
transaction, floor transaction, collar transaction, forward transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
these transactions) or any combination thereof, whether linked to one or more
interest rates, foreign currencies, commodity prices, equity prices or other
financial measures.
"Reimbursement Agreement" shall mean a Reimbursement Agreement
substantially in the form of the Bank's standard letter of credit reimbursement
agreement, or otherwise acceptable to the Bank in its sole discretion.
"Related Party" shall mean the Borrower, any of its Affiliates, and
any other person who is a member of the same Controlled Group as, or is treated
as a single employer with, the Borrower or any such Affiliate under section
414(b), (c), (m), or (o) of the Code."
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"Release" has the same meaning as given to that term in Section
101(22) of the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, 42 U.S.C. Section 9601(22), and the regulations
promulgated thereunder.
"Reportable Event" means a reportable event described in Section
4043 of ERISA and regulations thereunder other than a reportable event not
subject to the requirement for a 30-day notice to the PBGC.
"Revolving Line" shall mean the revolving line of credit established
pursuant to Section 2.1 of this Agreement.
"Revolving Line Note" shall mean the note evidencing Obligations
related to the Revolving Line as described in Section 2.2 of this Agreement.
"Revolving Line Termination Date" shall mean the date on which the
Revolving Line terminates as described in Section 2.5 of this Agreement.
"Subsidiary" shall mean any entity with respect to which Borrower
owns a majority of the equity and voting interests.
"Tangible Assets" shall mean total assets, after deduction of
depreciation, depletion, and reserves, but excluding subordinated debt and
accounts from and other obligations payable by officers and Affiliates and
further excluding all assets required to be classified as intangible assets in
accordance with GAAP (including without limitation organizational expense, good
will, unamortized debt discount, research and development costs, patents,
trademarks, copyrights, other intellectual property rights, franchises, and
deferred assets).
"Tangible Net Worth" shall mean Tangible Assets less Total
Liabilities as determined by GAAP.
"Term Loan" shall mean a term loan made pursuant to Article 4 of
this Agreement.
"Term Loan Note" shall mean a note evidencing Obligations related to
a Term Loan as described in Section 4.2 of this Agreement.
"Total Current Assets" shall mean all assets treated as current
assets in accordance with GAAP.
"Total Current Liabilities" shall mean all liabilities treated as
current liabilities in accordance with GAAP, including without limitation all
obligations payable on demand or within one year after the applicable
measurement date as well as installment, reimbursement, or sinking fund payments
payable within one year after the applicable measurement date, but excluding any
such liabilities which are renewable or extendable at the option of the obligor
to a date more than one year after the applicable measurement date.
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"Total Liabilities" shall mean the sum of all liabilities shown on
the Borrower's balance sheet as of the applicable date of determination,
determined in accordance with GAAP including without limitation subordinated
debt.
"Welfare Plan" means an employee welfare benefit plan as defined in
Section 3(1) of ERISA, maintained for employees of the Borrower or any
Controlled Group Member.
"Working Capital" means Total Current Assets minus Total Current
Liabilities as determined by GAAP.
ARTICLE 2 - REVOLVING LINE
2.1 Revolving Line. Subject to the terms and conditions of this Agreement,
the Bank hereby establishes for the benefit of the Borrower a revolving line of
credit in the maximum principal amount of Thirteen Million Dollars
($13,000,000.00) outstanding at any one time. The proceeds of the Revolving Line
shall be used to meet the Borrower's letter of credit and working capital
requirements. Subject to the terms of this Agreement, the Borrower may borrow,
repay, and reborrow under the Revolving Line so long as the aggregate principal
amount outstanding at any time, plus (a) the undrawn amount of all Letters of
Credit and (b) the outstanding principal amount of all Term Loans, does not
exceed $13,000,000.00.
2.2 Revolving Line Note. The Borrower shall execute, together with this
Agreement, a note evidencing Obligations related to the Revolving Line in the
form of Exhibit A attached hereto and made a part hereof.
2.3 Interest Rate.
Outstanding amounts under the Revolving Line Note shall bear
interest, except as otherwise specifically provided herein, at a variable rate
per annum equal to the Prime Rate in effect from time to time minus the
Applicable Prime Rate Margin.
The Borrower from time to time, however, may elect to have portions
of the principal outstanding under the Revolving Line Note bear interest at the
fixed per annum rate equal to the one-month, two-month, or three- month LIBOR
Rate plus the Applicable LIBOR Margin for the period applicable to that rate by
giving at least two (2) business days' prior notice in writing or by telecopy to
the Bank. The notice shall specify (i) the rate chosen, (ii) the outstanding
principal amount to bear interest at the applicable LIBOR Rate (with any
outstanding amounts from time to time under the Revolving Line Note, in excess
of such specified amount, to bear interest at the rate based upon the Prime
Rate), and (iii) the commencement date for such rate. No LIBOR Interest Period
may be elected that would extend beyond the maturity date of the Revolving Line
Note. The rate of interest so elected shall be in effect for the respective
applicable LIBOR Interest Period. The Borrower shall be responsible for all
Break Costs including without limitation those applicable if during any period
in which a LIBOR based rate or rates is or are in effect, if the principal
amount outstanding under the Revolving Line Note bearing interest at such
respective rate or rates is ever less than the principal amount stated in the
respective election notice or notices for such period.
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Interest shall continue to accrue after maturity, acceleration, and
judgment at the rate required by this Agreement until the Revolving Line Note is
paid in full. All computations of interest shall be made on the basis of a three
hundred sixty (360) day year and the actual number of days elapsed.
2.4 Payments. Payments of all accrued interest under the Revolving Line
Note shall be due on the first day of each month.
In the event the Borrower becomes aware, or receives notice (oral or
written) from the Bank, that principal amounts outstanding under the Revolving
Line exceed the maximum available amount described herein at any time, Borrower
promptly shall make a principal payment to the Bank sufficient to reduce
outstanding principal amounts to the maximum amount available hereunder.
All remaining outstanding principal and accrued interest shall be
due and payable in full upon the earlier of (a) at the option of the Bank, upon
written notice to Borrower, an Event of Default, or (b) the Revolving Line
Termination Date, provided that under certain circumstances, some or all of the
principal amounts outstanding under the Revolving Line may be converted to a
Term Loan in accordance with the terms of Article 4 hereof.
The Borrower may prepay principal outstanding under the Revolving
Line Note which is bearing interest based on the Prime Rate at any time without
premium or charge.
The Borrower may prepay an Obligation for which the interest rate is
based upon LIBOR only upon at least three (3) Business Days prior written notice
to Bank (which notice shall be irrevocable), and any such prepayment shall occur
only on the last day of the LIBOR Interest Period applicable to such Obligation.
Borrower shall pay to the Bank, upon request of Bank, Break Costs if any. Each
principal prepayment shall be accompanied by a payment of all accrued interest
on the principal prepaid.
In addition, any prepayment due to a refinancing of the Revolving
Line in whole or in part by another financial institution (i) one year or less
after the date hereof must be accompanied by an additional $100,000 premium
payment, (ii) more than one year but less than two years after the date hereof
must be accompanied by a $50,000 premium payment, and (iii) thereafter prior to
the Revolving Line Termination Date must be accompanied by a $10,000 premium
payment.
All payments shall be made by Borrower to Bank at the address for
Bank first shown above in this Agreement or such other place as Bank may from
time to time specify in writing in lawful currency of the United States of
America in immediately available funds, without counterclaim or setoff and free
and clear of, and without deduction or withholding for, any taxes or other
payments.
2.5 Revolving Line Termination. Unless extended in writing by the Bank on
terms and conditions then acceptable to the Bank, the Revolving Line will
terminate on, the earlier of (i) October 31, 2008 and (ii) the date of
termination pursuant to Section 12.1 hereof.
12
2.6 Audits. Borrower agrees to allow the Bank complete access to all books
and records of the Borrower upon reasonable request. Borrower agrees to submit
information which the Bank may reasonably request from time to time in
connection with the Revolving Line.
2.7 Facility Fee. The Borrower shall pay the Bank on or before the date of
the first advance hereunder a facility fee of one-quarter of one percent (0.25%)
of the maximum amount available under the Revolving Line ($32,500.00).
2.8 Unused Fee. The Borrower shall pay the Bank a quarterly fee of
one-quarter of one percent (0.25%) per annum times the average unused
availability under the Revolving Line during the preceding quarter. For purposes
of calculating such average unused availability, the undrawn amounts of
outstanding Letters of Credit shall be aggregated with amounts borrowed under
the Revolving Line in determining what portion of the Revolving Line has been
used. At the end of each fiscal quarter, the Bank will xxxx the Borrower for the
unused fee.
ARTICLE 3 - LETTERS OF CREDIT
3.1 Letters of Credit. Subject to the terms and conditions of this
Agreement, the Bank will make Letters of Credit available for the account of the
Borrower in an aggregate stated face amount not exceeding the lesser of (a)
Eight Million Dollars ($8,000,000), and (b) the availability under the Revolving
Line. Letters of Credit will be made promptly available for the Borrower's work
in process (to support customer progress payments) or as otherwise requested by
Borrower for general business purposes. The stated amount outstanding under all
Letters of Credit at all times shall reduce, dollar for dollar, the amount
available for advances under the Revolving Line. The Letters of Credit shall be
in form satisfactory to the Bank and will be for a term of up to three (3) years
from the date of issuance, except that Letters of Credit in the aggregate face
amount of $4,000,000.00 may have maturities of up to four (4) years from the
date of issuance, which date of issuance may be no later than the Revolving Line
Termination Date.
3.2 Commissions. The Borrower will pay letter of credit commissions to the
Bank on the date of issuance of the Letter of Credit and on each anniversary
date thereafter if the Letter of Credit is renewed or has a maturity in excess
of one year from the date of issuance, equal to one and one-quarter of one
percent (1.25%) of the undrawn amount thereof for standby letters of credit, and
one-quarter of one percent (0.25%) of the undrawn amount thereof for documentary
letters of credit. Commissions on letters of credit having maturities of less
than one year shall be charged ratably. In addition, the Borrower will pay to
the Bank a $150 administrative fee for each Letter of Credit issued pursuant to
this Agreement.
3.3 Reimbursement. The Borrower will execute a Reimbursement Agreement
that is satisfactory to the Bank, documenting its Obligations with respect to
each of the Letters of Credit. Among other items, the Reimbursement Agreement
will require immediate reimbursement to the Bank for all amounts drawn under the
Letters of Credit, and outstanding drawn amounts not so reimbursed may, at the
discretion of the Bank, be treated as advances under the Revolving Line.
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All payments shall be made by Borrower to Bank at the address for
Bank first shown above in this Agreement or such other place as Bank may from
time to time specify in writing in lawful currency of the United States of
America in immediately available funds, without counterclaim or setoff and free
and clear of, and without deduction or withholding for, any taxes or other
payments.
ARTICLE 4 - TERM LOANS
4.1 Term Loans. Subject to the terms and conditions of this Agreement, and
provided that no Default exists, (a) prior to or upon the Revolving Line
Termination Date, the Borrower shall have the right from time to time to convert
not less than Two Million Dollars ($2,000,000) at any one time and up to Nine
Million Dollars ($9,000,000) in the aggregate of then-outstanding principal
amounts under the Revolving Line (excluding the face amount of any outstanding
Letters of Credit), and (b) on the Revolving Line Termination Date, all
then-outstanding principal amounts under the Revolving Line (excluding the face
amount of any outstanding Letters of Credit) shall be converted to a two-year
term loan (each, a "Term Loan"). The proceeds of each Term Loan shall be used to
satisfy the converted Revolving Line Obligations. The principal amount
outstanding under each Term Loan shall reduce, dollar for dollar, the amount
available for advances under the Revolving Line.
4.2 Term Loan Note. Each Term Loan shall be evidenced by a note dated on
the Conversion Date of that Term Loan in the form of Exhibit B attached hereto
and made a part hereof.
4.3 Interest Rate.
Outstanding amounts under each Term Loan Note shall bear interest,
except as otherwise specifically provided herein, at a variable rate per annum
equal to the Prime Rate in effect from time to time minus the Applicable Prime
Rate Margin.
The Borrower from time to time, however, may elect to have portions
of the principal outstanding under a Term Loan Note bear interest at the fixed
per annum rate equal to the one-month, two-month, or three-month LIBOR Rate plus
the Applicable LIBOR Margin for the period applicable to that rate by giving at
least two (2) business days' prior notice in writing or by telecopy to the Bank.
The notice shall specify (i) the rate chosen and (ii) the outstanding principal
amount to bear interest at the applicable LIBOR Rate, and (iii) the commencement
date for such rate. No LIBOR Interest Period for a Term Loan Note may be elected
that would extend beyond the maturity date of such Term Loan Note. The rate of
interest so elected shall be in effect for the respective applicable LIBOR
Interest Period. If the Borrower does not provide such an election notice two
business days prior to the expiration of a LIBOR Interest Period, interest shall
revert to the Prime Rate in effect from time to time minus the Applicable Prime
Rate Margin, as set forth above. The Borrower shall be responsible for all Break
Costs including without limitation those applicable if during any period in
which a LIBOR based rate or rates is or are in effect, if the principal amount
outstanding under any Term Loan Note bearing interest at such respective rate or
rates is ever less than the principal amount stated in the respective election
notice or notices for such period.
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Interest shall continue to accrue after maturity, acceleration, and
judgment at the rate required by this Agreement until each Term Loan Note is
paid in full. All computations of interest shall be made on the basis of a three
hundred sixty (360) day year and the actual number of days elapsed.
4.4 Payments.
Payments of all accrued interest under each Term Loan Note shall be
due on the first day of each month. Monthly principal payments with respect to
each Term Loan Note, each equal to one-twenty-fourth (1/24th) of the original
principal amount of such Term Loan Note, shall be due on the first day of each
month.
All remaining outstanding principal and accrued interest under each
Term Loan Note shall be due and payable in full on the date which is twenty four
(24) months from its Conversion Date.
The Borrower may prepay principal outstanding under a Term Loan Note
which is bearing interest based on the Prime Rate at any time without premium or
charge.
The Borrower may prepay an Obligation for which the interest rate is
based upon LIBOR only upon at least three (3) Business Days prior written notice
to Bank (which notice shall be irrevocable), and any such prepayment shall occur
only on the last day of the LIBOR Interest Period applicable to such Obligation.
Borrower shall pay to the Bank, upon request of Bank, Break Costs if any.
Prepayments shall be applied in inverse order of maturity. Each principal
prepayment shall be accompanied by a payment of all accrued interest on the
principal prepaid.
In addition, prepayment due to a refinancing of any Term Loan in
whole or in part with another financial institution (i) one year or less after
the date hereof must be accompanied by an additional $100,000 premium payment,
(ii) more than one year but less than two years after the date hereof must be
accompanied by a $50,000 premium payment, and (iii) thereafter prior to the
maturity date of the Term Loan must be accompanied by a $10,000 premium payment.
All payments shall be made by Borrower to Bank at the address for
Bank first shown above in this Agreement or such other place as Bank may from
time to time specify in writing in lawful currency of the United States of
America in immediately available funds, without counterclaim or setoff and free
and clear of, and without deduction or withholding for, any taxes or other
payments.
ARTICLE 5 - EXPENSES/FEES/DEFAULT RATE/PAYMENT APPLICATION
5.1 Costs and Expenses. Borrower shall pay on demand all reasonable
expenses of Bank in connection with the preparation, administration, default,
collection, waiver or amendment of Obligation terms, or in connection with
Bank's exercise, preservation, or enforcement of any of its rights, remedies, or
options hereunder, including without limitation, fees of outside legal counsel
or the allocated costs of in-house legal counsel, accounting, consulting,
brokerage or similar professional fees or expenses, and any fees or expenses
15
associated with travel or other costs relating to any appraisals or examinations
conducted in connection with any Obligation or any collateral therefor, and the
amount of all such expenses shall, until paid, bear interest at the highest rate
applicable to any Obligation (including any default rate) and be an Obligation
secured by any collateral.
5.2 Application of Payments. All payments shall be applied first to the
payment of all fees, expenses and other amounts due to the Bank (excluding
principal and interest), then to accrued interest, and the balance on account of
outstanding principal; provided, however, that after an Event of Default,
payments will be applied to the Obligations as Bank determines in its sole
discretion.
5.3 Default Interest Rate. Upon a Default (whether or not Bank has
accelerated payment of the Obligations), or after maturity or after judgment has
been rendered with respect to any of the Obligations, Borrower's right to select
pricing options shall cease and the unpaid principal of all Obligations shall,
at the option the Bank, bear interest at a rate which is four (4) percentage
points per annum greater than that which would otherwise be applicable.
5.4 Late Payment Fees. If the entire amount of any required principal
and/or interest is not paid in full under any of the Loan Documents within ten
(10) days after the same is due, Borrower shall pay to the Bank a late fee equal
to five percent (5%) of the required payment.
5.5 Prepayments Upon Default. If by reason of an Event of Default the Bank
elects to declare the Obligations to be immediately due and payable, then any
prepayment charge or Break Costs with respect to the Obligations shall become
due and payable in the same manner as though the Borrower had exercised a right
of prepayment.
5.6 Obligations Related to Rate Management Transactions. In the event that
the Borrower enters into any interest rate swap agreement or other agreement
related to any Rate Management Transaction with the Bank or any of its
affiliates, any costs incurred by the Bank or its affiliates in connection
therewith, including without limitation any interest, expenses, fees, premiums,
penalties or other charges associated with any obligations undertaken by the
Bank or its affiliates to hedge or offset the Bank's or its affiliates
obligations pursuant to such agreement, or the termination of any such
obligations, shall be (i) deemed additional interest and/or a related expense
(to be determined in the sole discretion of the Bank) and due as part of the
Obligations and secured by all collateral and covered by all guarantees
referenced in Article 6 and otherwise therefor to the full extent thereof, and
included in any judgment in any proceeding instituted by the Bank.
ARTICLE 6 - COLLATERAL
6.1 Reaffirmation of Security Interests. The Borrower hereby reaffirms to
the Bank its Amended and Restated Security Agreement (Accounts, Inventory,
Chattel Paper, Documents, Technology and General Intangibles) dated as of
November 3, 1999, and its Amended and Restated Security Agreement (Goods and
Equipment) dated as of December 3, 1999 (collectively, the "Security
Agreements"), and the liens created thereby. The Borrower confirms to the Bank
that the Security Agreements continue in full force and effect, and that the
16
Obligations hereunder constitute Obligations as defined in the Security
Agreements, secured by the Collateral described in the Security Agreements. Such
security interests shall be first liens on such assets, which shall not be
otherwise encumbered except as specified on Schedule 6.1 attached hereto and
made a part hereof.
ARTICLE 7 - REPRESENTATIONS OF BORROWER
a. Representations by the Borrower. The Borrower represents and warrants
to the Bank as follows:
7.1 Organization and Power. The Borrower is duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
duly qualified to transact business and in good standing in the State of New
York and in all other states in which failure to qualify could reasonably be
expected to have a Material Adverse Effect. The Borrower has full power and
authority to own its properties, to carry on its business as now being
conducted, to execute, deliver and perform the Loan Documents, and to consummate
the transactions contemplated thereby. The Borrower has no Subsidiaries or
Affiliates except those listed on Schedule 7.1.
7.2 Proceedings of Borrower. All necessary action on the part of the
Borrower, including shareholder approval to the extent required, relating to
authorization of the execution and delivery of the Loan Documents, and the
performance of the Obligations of the Borrower thereunder has been taken. The
Loan Documents constitute legal, valid and binding obligations of the Borrower,
enforceable in accordance with their respective terms. To the best of Borrower's
knowledge, after due inquiry, the Borrower has no defenses, offsets, claims, or
counterclaims with respect to its obligations arising under the Loan Documents.
The execution and delivery by the Borrower of the Loan Documents, and the
performance by the Borrower of the Loan Documents, will not violate any
provision of law or the Borrower's Certificate of Incorporation or By-laws or
organizational or other documents or agreements. The execution, delivery and
performance of the Loan Documents, and the consummation of the transactions
contemplated thereby will not violate, be in conflict with, result in a breach
of, or constitute a default under any agreement to which the Borrower is a party
or by which any of its properties is bound, or any order, writ, injunction, or
decree of any court or governmental instrumentality, and will not result in the
creation or imposition of any lien, charge or encumbrance upon any of its
properties.
7.3 Capitalization. All of the outstanding share interests and other
equity interests of the Borrower are duly authorized, validly issued, and fully
paid. Except for put options on shares distributed to participants in the
Borrower's Employee Stock Ownership Plan, there is no existing contract,
debenture, security, right, option, warrant, call or similar commitment of any
character calling for or relating to the issuance of, purchase or receipt of, or
redemption or retirement of, shares or other equity interests of the Borrower.
7.4 Litigation. Except as disclosed in the most recent Financial
Statements described in Section 7.5 hereof and in Schedule 7.4, there is no
action, suit or proceeding at law or in equity or by or before any governmental
instrumentality or other agency pending or, to the knowledge of the Borrower,
threatened against or affecting the Borrower that brings into question the
legality, validity or enforceability of the Loan Documents or the transactions
17
contemplated thereby or that, if adversely determined, would reasonably be
expected to have a Material Adverse Effect.
7.5 Financial Statements. All financial statements furnished by the
Borrower to the Bank are complete and correct, have been prepared in accordance
with generally accepted accounting principles consistently applied throughout
the periods indicated, and fairly present the financial condition of the
Borrower, as of the respective dates thereof and the results of its operation
for the respective periods covered thereby.
7.6 Adverse Changes. Since the most recent financial statements described
in Section 7.5 hereof there has been no Material Adverse Effect.
7.7 Taxes. The Borrower has filed or caused to be filed when due all
federal tax returns and all state and local tax returns that are required to be
filed, and has paid or caused to be paid all taxes as shown on said returns or
any assessment received. The Borrower's tax returns are not being audited on the
date of this Agreement and the Borrower has not been notified of any intention
by any taxing authority to conduct such an audit.
7.8 Properties. The Borrower has good and marketable title to all of its
properties and assets, including without limitation, the properties and assets
reflected in the most recent financial statements referred to in Section 7.5
hereof. The Borrower has undisturbed peaceable possession under all leases under
which it is operating, none of which contain unusual or burdensome provisions
that would reasonably be expected to have a Material Adverse Effect, and all
such leases are in full force and effect.
7.9 Indebtedness. Except as disclosed in the most recent financial
statements referred to in Section 7.5 hereof and as set forth on Schedule 7.9
attached hereto, the Borrower has no outstanding indebtedness or contingent
liabilities (including without limitation "off-balance sheet" liabilities and
liabilities as account party with respect to letters of credit), other than
trade payables not yet due incurred in the ordinary course of business.
7.10 Franchises; Permits. The Borrower has obtained and is in compliance
with all material licenses, permits, franchises, and governmental authorizations
necessary for the ownership of its properties and the conduct of its business as
now being conducted, for which failure to comply would reasonably be expected to
have a Material Adverse Effect.
7.11 ERISA. No action, event, or transaction has occurred that could give
rise to a lien or encumbrance on the assets of Borrower as a result of the
application of relevant provisions of ERISA, and Borrower is in material
compliance with all requirements of ERISA. Schedule 7.11 lists all of the
Pension Plans which any Related Party or any member of its Controlled Group
maintains, contributes to or has any liability under (or with respect to),
whether or not terminated. No Pension Plan maintained by any Related Party or
any member of its Controlled Group or to which such Person has an obligation to
contribute, or with respect to which such employer has any other liability, has
any material "unfunded liability" (i.e., accrued liabilities in excess of the
fair market value of its assets). For purposes of this representation, the Bank
agrees that the unfunded liability in the amount of $353,161, shown on the
January, 2004 report for the Borrower's defined benefit plan is not material.
18
7.12 Margin Securities. No proceeds of the Obligations have been or will
be used for the purpose of purchasing or carrying Margin Securities as defined
in Regulation U of the Federal Reserve Board.
7.13 Compliance With Law. The Borrower is not in violation of any laws,
ordinances, governmental rules, requirements, or regulations to which it is
subject which violation would reasonably be expected to have a Material Adverse
Effect.
7.14 Environmental Matters. To the best of Borrower's knowledge:
(a) the Improvements are not being used for, and the Borrower is not
engaged in, the storage, treatment, generation, transportation,
processing, handling, production or disposal of any Hazardous Substance
except in compliance with all Environmental Laws;
(b) underground storage tanks are not and have not been located on
the Improvements except in compliance with all Environmental Laws;
(c) the soil, subsoil, bedrock, surface water and groundwater of the
Improvements are free of any Hazardous Substances;
(d) there has been no Release, nor is there the threat of a Release
of any Hazardous Substance on, at or from the Improvements, and Borrower
has not received any form of notice or inquiry from any federal, state or
local governmental agency or authority, any operator, tenant, subtenant,
licensee or occupant of the Improvements with regard to a Release or the
threat of a Release of any Hazardous Substance on, at or from the
Improvements;
(e) all Environmental Permits relating to the Borrower and the
Improvements have been obtained and are in full force and effect; there
are no agreements, consent orders, decrees, judgments, license or permit
conditions or other orders or directives of any federal, state or local
court, governmental agency or authority relating to the past, present or
future ownership, use, operation, sale, transfer or conveyance of the
Improvements which require any change in the present condition of the
Improvements or any work, repairs, construction, containment, clean up,
investigations, studies, removal or other remedial action or capital
expenditures with respect to the Improvements; and
(f) there are no actions, suits, claims or proceedings, pending or
threatened, which could cause the incurrence of expenses or costs of any
name or description or which seek money damages, injunctive relief,
remedial action or any other remedy that arise out of, relate to or result
from (i) a violation or alleged violation by Borrower of any applicable
Environmental Law or non-compliance or alleged non-compliance with any
Environmental Permit, (ii) the presence of any Hazardous Substance or a
Release or the threat of a Release of any Hazardous Substance on, at or
from the Improvements or (iii) exposure to any Hazardous Substance to the
extent the same arises from the Improvements or business or operations of
Borrower.
7.15 Patents; Trademarks; Authorizations. The Borrower owns or possesses
all patents, trademarks, service marks, trade names, copyrights, licenses,
authorizations, and all
19
rights with respect to the foregoing, necessary to the conduct of its business
as now conducted without any material conflict with the rights of others. The
Borrower has full rights, without infringement upon the rights of others, to all
intellectual property necessary for the operation of its business as it is now
or is contemplated to be conducted.
7.16 Contracts and Agreements. The Borrower is not a party to any contract
or agreement that has or can reasonably be expected to have a Material Adverse
Effect, and the Borrower is in compliance in all material respects with all
contracts and agreements to which it is a party.
b. Representations by the Bank. The Bank hereby makes the following
representations, warranties and covenants on which the Borrower may rely in
executing and delivering this Agreement. Such representations and warranties are
made as of the date of execution of this Agreement.
7.17 Authorization and Enforceability. This Agreement has been duly
authorized, executed and delivered by the Bank and constitutes a legal, valid
and binding obligation of the Bank enforceable against the Bank in accordance
with its terms, except as may be limited by bankruptcy or creditors' rights laws
or general principles of equity.
7.18 Performance. At the date of execution of this Agreement, the Bank
does not believe, nor does it have any reason or cause to believe, that it
cannot perform each and every one of its agreements contained in this Agreement.
Such representations and warranties are made as of the date of execution of this
Agreement.
ARTICLE 8 - CONDITIONS OF LENDING
The following conditions must be satisfied before the Bank shall have any
obligation to make any advance under this Agreement:
8.1 Representations and Warranties. The representations and warranties of
the Borrower contained herein shall be true and correct as of the date of making
of each such advance, with the same effect as if made on and as of such date.
8.2 No Defaults. There shall exist no Default at the time each advance is
made.
8.3 Performance. The Borrower shall have performed and complied with all
agreements and conditions required to be performed or complied with by it prior
to or at the time the advance is made.
8.4 Opinion of Counsel. On or before the date of this Agreement, the
Borrower shall have delivered an opinion of its counsel, in form and substance
reasonably satisfactory to the Bank.
8.5 Documents to be Delivered. On or before the date of this Agreement,
the Borrower shall have delivered to the Bank all security agreements,
mortgages, reimbursement agreements, assignments, guarantees, and any related
documents necessary or desirable in
20
connection with the requirements of Article 6 hereof; and all notes evidencing
the Obligations shall have been delivered to the Bank at the time of the making
of the respective loans.
8.6 Certified Resolutions. On or before the date of this Agreement the
Borrower shall have delivered a certificate of its corporate secretary
certifying resolutions duly adopted by the Board of Directors of the Borrower
authorizing the execution, delivery and performance of the Loan Documents, and
the consummation of the transactions contemplated thereby, which resolutions
shall remain in full force and effect so long as any of the Obligations are
outstanding or any commitment to lend exists under this Agreement or the Loan
Documents.
8.7 Fees and Taxes. The Borrower shall have paid all filing fees, taxes,
and assessments related to the borrowings and the perfection of any interests in
collateral security required hereunder.
8.8 Insurance. The Borrower shall have delivered evidence satisfactory to
the Bank of the existence of insurance required hereby.
8.9 Organizational Documents. On or before the date of this Agreement the
Borrower shall have delivered to the Bank copies of its then-effective
Certificate of Incorporation, By-laws, d/b/a certificates, and other
organizational documents and instruments.
8.10 Other Documents and Agreements. On or before the date of this
Agreement, the Borrower shall have delivered such other documents, instruments,
and agreements as the Bank and its legal counsel may require in connection with
the transactions contemplated hereby.
8.11 Financial Statements. On or before the date of this Agreement, the
Borrower shall have delivered to the Bank the Borrower's most recent monthly
financial statement.
8.12 Certificates of Good Standing. On or before the date of this
Agreement the Borrower shall have delivered to the Bank certificates of good
standing from appropriate state officials to the effect that the Borrower is in
good standing in the state of its formation as well as in all other states in
which qualification is necessary for the Borrower to carry on its business in
such states.
ARTICLE 9 - AFFIRMATIVE COVENANTS OF BORROWER
So long as any Obligations to the Bank shall be outstanding or this
Agreement remains in effect, unless the Bank otherwise consents in writing, the
Borrower shall:
9.1 Financial Statements. Furnish to the Bank as soon as available, but in
no event later than July 31, 2005, and each July 31 of any year thereafter in
which this Agreement remains in effect, copies of annual financial statements of
the Borrower in reasonable detail satisfactory to the Bank, prepared in
accordance with GAAP, and audited by and with an unqualified opinion from an
independent certified public accountant satisfactory to the Bank. Said financial
statements shall include at least a balance sheet, a statement of profit and
loss, and a statement of cash flows, and shall be accompanied by (i) a schedule
showing computation of financial covenants, (ii) a copy of any management letter
prepared by Borrower's accountants, and (iii) a certificate of the Chief
Financial Officer of the Borrower to the effect that no Default
21
or Event of Default has occurred or, if an Event of Default shall have occurred
and be continuing specifying the steps being taken to cure such Event of
Default.
The Borrower also shall furnish to the Bank unaudited financial
statements not more than fifty (50) days after the close of each of the first
three quarters of its fiscal year. Said statements shall be in reasonable detail
satisfactory to the Bank, shall be prepared in accordance with GAAP, shall
include at least a balance sheet, a statement of profit and loss, a statement of
cash flows, and a schedule showing computation of financial covenants. Said
financial statements shall be certified to be true and correct to the best
knowledge of the Chief Financial Officer of the Borrower. Such financial
statements shall be accompanied by a certificate of the Chief Financial Officer
of the Borrower to the effect that no Default has occurred.
Not more than sixty (60) days after the close of each fiscal year,
Borrower shall deliver to the Bank a business plan and forecast for the next
succeeding fiscal year.
The Borrower shall provide to the Bank interim financial statements,
if any, prepared by the Borrower's independent accountants.
9.2 Other Reports and Inspections. Furnish to the Bank such additional
information, reports, or financial statements as the Bank may, from time to
time, reasonably request.
The Borrower shall permit any person designated by the Bank to
inspect the property, assets, and books of the Borrower at reasonable times and,
prior to an Event of Default, upon reasonable notice, and shall discuss its
affairs, finances, and accounts at reasonable times with the Bank from time to
time as often as may be reasonably requested.
9.3 Taxes. Pay and discharge all taxes, assessments, levies, and
governmental charges upon the Borrower, its income and property, prior to the
date on which penalties are attached thereto; provided, however, that the
Borrower may in good faith contest any such taxes, assessments, levies, or
charges so long as such contest is diligently pursued, appropriate reserves are
reflected on the Borrower's financial statements, and no lien or execution
exists or is levied against any of Borrower's assets related to the contested
items.
9.4 Insurance. Maintain or cause to be maintained insurance, of kinds and
in amounts as described on Schedule 9.4 annexed hereto, with the insurance
companies specified in such Schedule 9.4, or with other responsible insurance
companies on all of its real and personal properties in such amounts and against
such risks as are prudent, including but not limited to, full-risk extended
coverage hazard insurance to the full insurable value of real property
(co-insurance not being permitted without the prior written consent of the
Bank), all-risk coverage for personal property, business interruption or loss of
rents coverage, worker's compensation insurance (unless the Borrower is
self-insuring on terms approved by the Bank in advance), and comprehensive
general liability insurance. The Borrower also shall maintain flood insurance
covering any of its real properties located in flood zones. The Borrower shall
provide to the Bank, annually, a detailed list and evidence satisfactory to the
Bank of its insurance carriers and coverage. Hazard insurance policies for real
property shall name the Bank as loss payee, and for personalty, loss payee, as
its interests may appear, and liability insurance policies shall name the
22
Bank as additional insured, and all policies shall provide for at least thirty
(30) day's prior notice of cancellation to the Bank.
9.5 Existence. Cause to be done all things necessary to preserve and to
keep in full force and effect its existence, rights, and franchises.
9.6 Maintenance of Properties. At all times maintain, preserve, protect,
and keep its property used or useful in conducting its business, in good repair,
working order, and condition, ordinary wear and tear excepted, and, from time to
time, make all needful and proper repairs, renewals, replacements, betterments,
and improvements thereto, so that the business carried on may be properly and
advantageously conducted at all times.
9.7 Material Changes; Judgments. Notify the Bank immediately of any
Material Adverse Effect and of the filing of any suits, judgments, or liens
which, if adversely determined, could reasonably be expected to have a Material
Adverse Effect. The Borrower also shall notify the Bank immediately of any
change in the name, identity, or organizational structure of the Borrower, or
any change in any equity or ownership interest in the Borrower.
9.8 Environmental Compliance.
(a) Comply with, and shall cause all operators, tenants, subtenants,
licensees and occupants of the Improvements to comply with all applicable
Environmental Laws and shall obtain and comply with, and shall cause all
operators, tenants, subtenants, licensees and occupants of the
Improvements to obtain and comply with, all Environmental Permits;
(b) Provide Bank with a copy of all notifications which it gives or
receives with respect to any past or present Release or the threat of a
Release of any Hazardous Substance on, at or from the Improvements;
(c) at all times allow the Bank and its officers, employees, agents,
representatives, contractors and subcontractors reasonable access after
reasonable prior notice to the Improvements for the purposes of
ascertaining compliance with Environmental Laws and site conditions,
including, but not limited to, subsurface conditions;
(d) deliver to the Bank: (i) copies of any documents received from
the United States Environmental Protection Agency, or any state, county or
municipal environmental or health agency concerning the Borrower's
operations or the Improvements; and (ii) copies of any documents submitted
by the Borrower to the United States Environmental Protection Agency or
any state, county or municipal environmental or health agency concerning
its operations or the Improvements; and
(e) if at any time the Bank obtains any reasonable evidence or
information which suggests that a potential environmental problem may
exist with respect to the Borrower or the Improvements that would pose a
Material Adverse Effect to the Bank, at the Bank's request provide to the
Bank a full or supplemental environmental inspection and audit report of a
scope and level of detail satisfactory to Bank and prepared by an
23
environmental engineer or other qualified person acceptable to the Bank at
Borrower's expense. If such audit report indicates the presence of any
Hazardous Substance or a Release or the threat of a Release of any
Hazardous Substance by Borrower on, at or from the Improvements, Borrower
shall undertake and pursue to completion all legally required
investigative, containment, removal, clean up and other remedial actions,
using methods recommended by the engineer or other person who prepared
said audit report and acceptable to the appropriate federal, state and
local agencies or authorities.
9.9 ERISA Notices. At the Bank's request, deliver to the Bank copies of
(i) all annual reports, including schedules and attachments, filed with the
Internal Revenue Service or PBGC by either the Borrower or a Controlled Group
Member with respect to any Pension Plan subject to Title IV of ERISA and (ii)
all notices Borrower receives from the Internal Revenue Service, PBGC, or U.S.
Department of Labor with respect to any Pension Plan, Welfare Plan, or
Multiemployer Plan, promptly after the filing or receipt of such documents. As
soon as possible, and in any event within thirty (30) days after Borrower
actually knows that any Reportable Event or material Prohibited Transaction has
occurred or will occur with respect to any Pension Plan or Welfare Plan, that
the PBGC, Borrower, or any Controlled Group Member has instituted or will
institute proceedings under Title IV of ERISA to terminate any Pension Plan,
that application will be made to the Secretary of the Treasury for a waiver of
the minimum funding standard pursuant to Section 412(d) of the Code with respect
to any Pension Plan or Multiemployer Plan, or that Borrower or a Controlled
Group Member has or will withdraw from a Multiemployer Plan in a complete or
partial withdrawal, Borrower shall deliver to the Agent a certificate of the
chief financial officer of Borrower setting forth details as to such Reportable
Event or material Prohibited Transaction or Pension Plan termination or waiver
application or withdrawal and the action Borrower proposes to take with respect
thereto.
9.10 Labor Disputes. Within ten (10) days after Borrower learns of (a) any
material labor dispute to which Borrower is likely to become a party, (b) any
strikes or material walkouts relating to any plants or other facilities of
Borrower, or (c) the expiration of any labor contract to which Borrower is a
party or by which Borrower is bound, notify the Bank of the same and the steps
Borrower plans to take in response thereto.
9.11 Franchises/Permits/Laws. Preserve and keep in full force and effect
all franchises, permits, licenses, and other authority as are necessary to
enable it to conduct its business as being conducted on the date of this
Agreement and comply in all material respects with all laws, the provisions of
regulations, and requirements now in effect or hereafter promulgated by any
properly constituted governmental authority having jurisdiction over it.
9.12 Payments. Make all payments as and when required by the Loan
Documents.
9.13 Amendments. Give the Bank written notice of an amendment or
modification to its Certificate of Incorporation or other governing documents or
agreements.
9.14 Shareholder and Officer Loans. The Borrower shall provide to the Bank
subordination agreements in form satisfactory to the Bank covering any loans to
the Borrower
24
from, or other obligations of the Borrower to, its Affiliates and shareholders
in existence from time to time.
ARTICLE 10 - NEGATIVE COVENANTS OF BORROWER
So long as any Obligations shall be outstanding, or this Agreement shall
remain in effect, unless the Bank otherwise consents in writing, the Borrower
shall not, directly or indirectly:
10.1 Indebtedness. Create, incur, assume, or allow to exist, voluntarily
or involuntarily, any obligation or obligations in the aggregate exceeding
$300,000 at any one time during the term of this Agreement for borrowed money or
its equivalent, excluding only (i) Obligations to and interests held by the
Bank, (ii) obligations described in Schedule 7.9 attached hereto and made a part
hereof, (iii) obligations to which the Bank consents in writing, (vi) trade
indebtedness incurred in the ordinary course of the Borrower's business, (v)
accrued payroll or compensation obligations; and (vi) loans, advances or other
distributions permitted by Section 10.4(b).
10.2 Mortgages; Liens; Encumbrances. Create, incur, assume, or allow to
exist, voluntarily or involuntarily, any capitalizable lease, mortgage, security
interest, pledge, lien or other encumbrance of any kind covering any of its
property or assets, whether now owned or hereafter acquired, excluding only (i)
interests held by the Bank, (ii) encumbrances described in Schedule 6.1, (iii)
the charge upon property purchased under conditional sales or other title
retention agreements, and (iv) obligations and interests to which the Bank
consents in writing. The Borrower will not enter into any sale-leaseback
transactions.
10.3 Contingent Liabilities. (i) assume, guarantee, endorse, contingently
agree to purchase, or otherwise become liable in any manner upon obligations in
the aggregate exceeding $150,000 at any time during the term of this Agreement,
contingent or otherwise, whether funded or current except for endorsement of
negotiable instruments for deposit, collection, or similar transactions in the
ordinary course of business, (ii) guarantee the dividends of any Person, or
(iii) become the general partner in any partnership.
10.4 Loans; Investments.
(a) Except as permitted by Section 10.4 (b), make any loan or advance to,
or any investment in, any person, firm, joint venture, corporation or other
entity whatsoever exceeding $150,000 in the aggregate at any one time
outstanding, except short-term investments in certificates of deposit of
financial institutions and similar investments made in the ordinary course of
business.
(b) Borrower shall not make any loans, advances, or other distributions of
any kind exceeding $500,000 in the aggregate at any one time outstanding to any
Affiliates of the Borrower without the prior consent of the Bank, which may be
withheld in its absolute discretion.
10.5 Mergers; Sales; Acquisitions; Changes in Ownership Interests. (i)
Sell, lease, transfer, or otherwise dispose of any material portion of its
assets except in the ordinary course of business, or (ii) enter into any merger
or consolidation, or acquire all or substantially
25
all the stock or other ownership interests or assets of any person, firm, joint
venture, corporation, or other entity; provided, however, that such mergers,
consolidations, or acquisitions shall be permitted if they do not exceed
$7,000,000 in the aggregate and if, on a pro forma basis, the Borrower will
continue to comply with the covenants contained in this Agreement, including
without limitation the covenants contained in Article 11 hereof, on a going
forward basis after completion of such merger, consolidation, or acquisition.
10.6 Distributions. Make any Distributions or apply any of its property or
assets to Distributions or set apart any sum or asset for the purpose of
Distribution; provided, however, that Borrower may make dividends in the
aggregate maximum amount of $500,000 per year and may repurchase or redeem stock
in the aggregate maximum amount of $500,000 per year so long as after any such
transactions no Event of Default exists and the Borrower continues to comply
with Article 11 hereof.
10.7 Material Changes. Permit any material change to be made in the
character of the business of the Borrower, or in its Chief Executive Officer or
Chief Financial Officer, other than for cause unless Borrower shall have
provided for a successor reasonably acceptable to the Bank, or in the nature of
its operations as carried on at the date hereof.
10.8 Judgments. Allow to exist for more than sixty (60) days any judgments
against Borrower in excess of $250,000.00 which are not fully covered by
insurance or for which an appeal or other proceeding for the review thereof
shall not have been taken and for which a stay of execution pending such appeal
shall not have been obtained.
10.9 Margin Securities. Allow any portion of the proceeds of the
Obligations to be used, in whole or in part, for the purpose of purchasing or
carrying any "margin stock" as such term is defined in Regulation U of the Board
of Governors of the Federal Reserve.
10.10 Negative Pledge. Enter into any agreement with anyone other than the
Bank in which Borrower agrees not to pledge or otherwise transfer or encumber
any asset of Borrower (including any and all Property) now or hereafter owned,
whether or not such asset has been pledged to the Bank, except negative pledge
agreements regarding liens which would be permitted by Section 10.2 hereof.
ARTICLE 11 - FINANCIAL COVENANTS
So long as any Obligations to the Bank shall be outstanding or this
Agreement remains in effect, unless the Bank otherwise consents in writing, the
Borrower shall:
11.1 Minimum Tangible Net Worth. Maintain a minimum Tangible Net Worth as
follows:
26
FISCAL QUARTER ENDING XXX.XXX WORTH
--------------------- -------------
6/30/05 $15,000
9/30/05 $15,500
12/31/05 $16,500
3/31/06 $17,500
6/30/06 $17,500
9/30/06 $18,000
12/31/06 $19,000
3/31/07 $19,500
6/30/07 $19,500
9/30/07 $19,500
12/31/07 $19,500
3/31/08 $19,500
11.2 Maximum Debt To Worth Ratio. Maintain a maximum Debt To Worth Ratio
for the Borrower of (i) 1.65 to 1.0 from the date hereof until March 31, 2006,
and (ii) 1.55 to 1.0 at all times thereafter, as shown on each quarterly and
annual financial statement for the Borrower provided to the Bank.
11.3 Minimum Debt Service Coverage Ratio. Maintain a minimum Debt Service
Coverage Ratio for the Borrower of 1.30 to 1.0, as shown on each year-end
financial statement for the Borrower provided to the Bank.
11.4 Minimum Working Capital. Maintain minimum net Working Capital of
$8,000,000 at all times, as shown on the annual financial statement for the
Borrower provided to the Bank.
ARTICLE 12 - DEFAULTS
12.1 Defaults. The following events shall constitute "Events of Default"
under this Agreement.
(a) Nonpayment. Failure of the Borrower to make any payment of any
type under the terms of the Loan Documents within ten (10) days after the
same becomes due and payable.
(b) Performance. Failure of the Borrower to observe or perform any
condition, covenant or term of the Loan Documents; provided, however, that
an Event of Default shall not occur unless such failure is not cured
within thirty (30) days after the Bank gives the Borrower written notice
of same.
(c) Other Obligations to Bank. Failure of the Borrower to observe or
perform any other condition, covenant, or term of any other material
agreement with the Bank after any applicable cure or grace period related
thereto.
(d) Obligations to Third Persons. Default by the Borrower under any
agreement involving Debt in an amount exceeding $10,000 to any Person
other than the
27
Bank, or default by Borrower with respect to any other material agreement
with any third Person which default could reasonably be expected to have a
Material Adverse Effect.
(e) Representations. Failure of any material representation or
warranty made by the Borrower in connection with the execution and
performance of this Agreement, or any certificate of officers pursuant
hereto, to be truthful, accurate or correct in all material respects when
made.
(f) Financial Difficulties. Financial difficulties of the Borrower
as evidenced by:
(i) any admission in writing of inability to pay debts as they
become due; or
(ii) the filing of a voluntary or involuntary petition in
bankruptcy, or under any chapters of the Bankruptcy Code, or under
any federal or state statute providing for the relief of debtors; or
(iii) making an assignment for the benefit of creditors; or
(iv) consenting to the appointment of a trustee or receiver
for all or a major part of any of its property; or
(v) the entry of a court order appointing a receiver or a
trustee for all or a major part of its property; provided, that the
Borrower shall have sixty (60) days to obtain an order removing such
receiver or trustee;
(vi) the occurrence of any Forfeiture Action.
(g) ERISA Matters.
(i) the occurrence of an ERISA Title IV Liability Event (other
than an ERISA Title IV Liability Event which is not expected to have
a Material Adverse Effect)with respect to a Borrower Pension Plan
subject to Title IV of ERISA that is not sufficient for benefit
liabilities within the meaning of Section 4041(d) of ERISA; or
(ii) receipt of notice by Borrower or any Controlled Group
Member that action is being taken to terminate or reorganize a
Multiemployer Plan if such termination or reorganization is likely
to result in a material liability being imposed on Borrower or any
Controlled Group Member; or
(iii) the existence of an accumulated funding deficiency (as
defined in Section 412(a) of the Code) with respect to a Borrower
Pension Plan which is reasonably likely to have a Material Adverse
Effect on Borrower; or
(iv) to the extent reasonably likely to cause a Material
Adverse Effect on Borrower, (A) the withdrawal by Borrower or any
Controlled Group Member
28
from any Multiemployer Plan in a complete or partial withdrawal
(within the meaning of Sections 4203 and 4205 of ERISA), unless the
Bank receives confirmation from the plan that no withdrawal
liability (within the meaning of Section 4201 of ERISA) will result
from such withdrawal, or (B) the receipt by Borrower or any
Controlled Group Member of a notice of withdrawal liability or
demand for payment of withdrawal liability from a Multiemployer Plan
or on account of a complete or partial withdrawal from a
Multiemployer Plan on account of secondary liability for withdrawal
liability following a sale of assets subject to Section 4204 of
ERISA.
12.1 Remedies. If any one or more Events of Default listed in Section 12.1
(f)(ii)-(v) occur, (i) any further commitments or obligations of the Bank shall
be deemed to be automatically and without need for further action terminated,
and (ii) all Obligations of the Borrower to the Bank, automatically and without
need for further action, shall become forthwith due and payable without
presentment, demand, protest, or other notice of any kind, all of which are
hereby expressly waived. If any one or more Events of Default other than those
listed in Section 12.1 (f)(ii)-(v) occur, the Bank may, at its option, take
either or both of the following actions at the same or different times: (i)
terminate any further commitments or obligations of the Bank, and (ii) declare
all Obligations of the Borrower to the Bank, automatically and without need for
further action, to be forthwith due and payable without presentment, demand,
protest, or other notice of any kind, all of which are hereby expressly waived.
In case any such Events of Default shall occur, the Bank shall be
entitled to recover judgment against the Borrower for all Obligations of the
Borrower to the Bank either before, or after, or during the pendency of any
proceedings for the enforcement of any security interests, mortgages, pledges,
or guarantees and, in the event of realization of any funds from any security or
guarantee and application thereof to the payment of the Obligations due, the
Bank shall be entitled to enforce payment of and recover judgment for all
amounts remaining due and unpaid on such Obligations. The Bank shall be entitled
to exercise any other legal or equitable right which it may have, and may
proceed to protect and enforce its rights by any other appropriate proceedings,
including action for the specific performance of any covenant or agreement
contained in this Agreement and other agreements held by the Bank.
If any Default occurs, the Bank or its designee shall have the
right, upon reasonable notice to the Borrower, to enter upon the Improvements
and conduct such tests, investigation and sampling, including but not limited to
installation of monitoring xxxxx, as shall be reasonably necessary for the Bank
to determine whether any disposal of Hazardous Substances has occurred on, at or
near the Improvements. The costs of all such tests, investigations and samplings
shall be considered as additional indebtedness secured by all collateral for the
Obligations and shall become immediately due and payable without notice and with
interest thereon at highest rate then borne by any of the Obligations. The
Borrower agrees that the Bank shall not be liable in any way for the
completeness or accuracy of any Environmental Report or the information
contained therein. The Borrower further agrees that the Bank has no duty to warn
the Borrower or any other Person about any actual or potential environmental
contamination or other problem that may have become apparent or will become
apparent to the Bank.
29
ARTICLE 13 - MISCELLANEOUS
13.1 Entire Agreement/Waiver. This Agreement and the Loan Documents are
intended by the parties as the final, complete, and exclusive statement of the
transactions evidenced by this Agreement and the Loan Documents. All prior or
contemporaneous promises, agreements, and understandings, whether oral or
written, are deemed to be superseded by this Agreement and the Loan Documents,
and no party is relying on any promise, agreement, or understanding not set
forth in this Agreement and the Loan Documents. This Agreement and the Loan
Documents may not be amended or modified except by a written instrument
describing such amendment or modification executed by the Borrower and the Bank.
No delay or failure of the Bank to exercise any right, remedy, power
or privilege hereunder shall impair the same or be construed to be a waiver of
the same or of any Default or an acquiescence therein. No single or partial
exercise of any right, remedy, power or privilege shall preclude other or
further exercise thereof by the Bank. All rights, remedies, powers, and
privileges herein conferred upon the Bank shall be deemed cumulative and not
exclusive of any others available.
13.2 Survival of Representations. All representations and warranties
contained herein shall survive the execution and delivery of this Agreement and
the execution and delivery of other agreements hereunder.
13.3 Setoff. The Borrower hereby grants to Bank a continuing lien,
security interest, and right of set off as security for the Obligations, whether
now existing or hereafter arising, upon and against all deposits, credits,
collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Bank or any entity under the control of Bank of
America Corporation and its successors and assigns or in transit to any of them.
At any time during the existence of a Default or Event of Default, without
demand or notice (any such notice being expressly waived by Borrower), Bank may
set off the same or any part thereof and apply the same to any Obligation of
Borrower even though unmatured and regardless of the adequacy of any other
collateral securing the Obligations. ANY AND ALL RIGHTS TO REQUIRE BANK TO
EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH
SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS RIGHT OF SET OFF WITH RESPECT
TO SUCH DEPOSITS, CREDITS, OR OTHER PROPERTY OF BORROWER ARE HEREBY KNOWINGLY,
VOLUNTARILY, AND IRREVOCABLY WAIVED.
13.4 Notices. Any notice or demand upon any party hereto shall be deemed
to have been sufficiently given or served for all purposes hereof when delivered
in person, one day after delivery to a nationally recognized overnight courier
with receipt requested, or two business days after it is mailed certified mail
postage prepaid, return receipt requested, addressed as follows:
If to Bank: Bank of America, N.A.
Xxx Xxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. X'Xxxxx
30
With a copy to: Xxxxxx Beach PLLC
00 Xxxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Xxx X. Still, Esq.
If to Borrower: Xxxxxx Corporation
00 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxx Xxxx 00000
Attention: J. Xxxxxx Xxxxxx
With a copy to: Xxxxxx X. Xxxxx, Esq.
Xxxxxx Xxxxxxx & Xxxxx LLP
0000 Xxxxxx & Xxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000-0000
Any party may change, by notice in writing to the other parties, the
address to which notices to it shall be sent.
13.5 Assignment/Participation. All the terms and provisions of this
Agreement shall inure to the benefit of and be binding upon and be enforceable
by the parties and their respective successors and permitted assigns and shall
inure to the benefit of and be enforceable by any holder of notes executed
hereunder; provided, however that Borrower may not assign its rights and
obligations hereunder without the prior written consent of the Bank.
Bank may at any time pledge or assign all or any portion of its
rights under the Loan Documents, including any portion of any note evidencing
the Obligations, to any of the twelve (12) Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
assignment or enforcement thereof shall release Bank from its obligations under
any of the Loan Documents.
The Bank shall have the unrestricted right at any time or from time
to time, and without Borrower's consent, to assign all or any portion of its
rights and obligations hereunder to one or more banks or other financial
institutions (each an "Assignee"), and Borrower agrees that it shall execute, or
cause to be executed, such documents, including without limitation, amendments
to this Agreement and to any other Loan Documents, as the Bank shall deem
necessary to effect the foregoing. In addition, at the request of the Bank and
any such Assignee, Borrower shall issue one or more new promissory notes, as
applicable, to any such Assignee and, if Bank has retained any of its rights and
obligations hereunder following such assignment, to Bank, which new promissory
notes shall be issued in replacement of, but not in discharge of, the liability
evidenced by the promissory note held by Bank prior to such assignment and shall
reflect the amount of the respective commitments and loans held by such Assignee
and Bank after giving effect to such assignment. Upon the execution and delivery
of appropriate assignment documentation, amendments, and any other documentation
required by Bank in connection with such assignment, and the payment by Assignee
of the purchase price agreed to by Bank and such Assignee, such Assignee shall
be a party to this Agreement and shall have all of the rights and obligations of
the Bank hereunder (and under any and all other Loan
31
Documents) to the extent that such rights and obligations have been assigned by
the Bank pursuant to the assignment documentation between the Bank and such
Assignee, and Bank shall be released from its obligations hereunder and
thereunder to a corresponding extent.
The Bank shall have the unrestricted right at any time and from time
to time, and without the consent of or notice to Borrower, to grant to one or
more banks or other financial institutions (each a "Participant") participating
interests in Bank's obligation to lend hereunder and/or any or all of the
Obligations. In the event of any such grant by Bank of a participating interest
to Participant, whether or not upon notice to Borrower, Bank shall remain
responsible for the performance of its obligations hereunder and Borrower shall
continue to deal solely and directly with Bank in connection with Bank's rights
and obligations hereunder.
The Bank may furnish any information concerning Borrower in its
possession from time to time to prospective Assignees and Participants, provided
that the Bank shall require any such prospective Assignee or Participant to
agree in writing to maintain the confidentiality of such information.
13.6 Business Days. If any Obligation or any payment hereunder becomes due
on a day which is not a Business Day, the due date of the Obligation or payment
shall be extended to the next succeeding Business Day, and such extension of
time shall be included in computing interest and fees in connection with such
payment.
13.7 Telecopy Requests. As a convenience to the Borrower, Borrower hereby
authorizes the Bank to rely upon requests made by the Borrower or its employees
by telecopy, and to treat such requests as if they were made in a writing
delivered to the Bank. Any advance of funds made by the Bank pursuant to any
such request shall be deemed to be authorized by the Borrower unless immediately
repaid in full.
13.8 Severability. In the event that any one or more of the provisions
contained in this Agreement or any other agreement, document, or guarantee
related hereto shall, for any reason, be held invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect
any other provision of this Agreement or such other agreement, document, or
guarantee. This Agreement has been prepared in cooperation of counsel for each
of the parties, and shall not be construed as against any particular party as
drafter.
13.9 Governing Law. This Agreement and the Loan Documents, and the rights
and obligations of the parties hereunder, shall be construed, interpreted,
governed and enforced in accordance with the laws of the State of New York
(excluding the laws applicable to conflicts or choice of law).
13.10 Replacement of Prior Agreements. This Agreement supersedes and
replaces the Amended and Restated Credit Facility Agreement dated November 3,
1999 between the Bank and the Borrower as the same was amended and the lines of
credit and term loans related thereto.
13.11 Loss or Mutilation. Upon receipt of an affidavit of an officer of
Bank as to the loss, theft, destruction, or mutilation of any note evidencing
any Obligation or any other Loan Document which is not of public record, and, in
the case of any such loss, theft, destruction or
32
mutilation, upon cancellation of such note or other Loan Document, Borrower will
issue, in lieu thereof, a replacement note or other Loan Document in the same
principal amount thereof and otherwise of like tenor.
13.12 Indemnity. The Borrower shall indemnify and hold harmless the Bank
and its affiliates, directors, officers, employees, agents, and representatives
from and against any and all claims, damages, liabilities, and expenses that may
be incurred by or asserted against such indemnified party in connection with the
Loan Documents and the transactions contemplated thereby including without
limitation in connection with the investigation of, preparation for, or defense
of any pending or threatened claim, action, or proceeding; provided, however,
that the Borrower shall not be liable to any indemnified party for such claims,
damages, liabilities, and expenses resulting from such indemnified party's own
gross negligence or willful misconduct.
The Borrower agrees to indemnify, defend, and hold harmless the Bank
from and against any and all liabilities, claims, damages, penalties,
expenditures, losses, or charges, including, but not limited to, all costs of
investigation, monitoring, legal representation, remedial response, removal,
restoration or permit acquisition of any kind whatsoever, which may now or in
the future be undertaken, suffered, paid, awarded, assessed, or otherwise
incurred by the Bank relating to, resulting from or arising out of (a) actions
by the Borrower related to, or the use of the Improvements for, the storage,
treatment, generation, transportation, processing, handling, production or
disposal of any Hazardous Substance, (b) the presence of any Hazardous Substance
or a Release or the threat of a Release of any Hazardous Substance on, at or
from the Improvements, (c) the failure to undertake and pursue to completion all
legally authorized investigative, containment, removal, clean up and other
remedial actions with respect to a Release or the threat of a Release of any
Hazardous Substance on, at or from the Improvements, (d) exposure to any
Hazardous Substance to the extent the same arise from activities of the Borrower
or the condition of the Improvements or the ownership, use, operation, sale,
transfer or conveyance thereof, (e) a violation of any applicable Environmental
Law, or (f) non-compliance with any Environmental Permit, except to the extent
that such liabilities, claims, damages, penalties, expenditures, losses or
charges result from the Bank's gross negligence or willful misconduct. Such
costs or other liabilities incurred by the Bank or other entity described in
this Section 13.12 shall be deemed to include, without limitation, any sums
which the Bank deems it necessary or desirable to expend to protect its security
interests and liens. Notwithstanding anything to the contrary contained herein,
the Borrower's liability and obligations under this Section 13.12 shall survive
the discharge, satisfaction or assignment of this Agreement by the Bank and the
payment in full of all of the Obligations.
13.13 Usury. All agreements between Borrower and Bank are hereby expressly
limited so that in no contingency or event whatsoever, whether by reason of
acceleration or maturity of the indebtedness evidenced hereby or otherwise,
shall the amount paid or agreed to be paid to Bank for the use or the
forbearance of the indebtedness evidenced hereby exceed the maximum permissible
under applicable law. As used herein, the term "applicable law" shall mean the
law in effect as of the date hereof, provided, however that in the event there
is a change in the law which results in a higher permissible rate of interest,
then the Loan Documents shall be governed by such new law as of its effective
date. In this regard, it is expressly agreed that it is the intent of Borrower
and Bank in the execution, delivery and acceptance of this Agreement to contract
in strict compliance with the laws of the State of New York from time to time in
33
effect. If, under or from any circumstances whatsoever, fulfillment of any
provision hereof or of any of the Loan Documents at the time performance of such
provision shall be due, shall involve transcending the limit of such validity
prescribed by applicable law, then the obligation to be fulfilled shall
automatically be reduced to the limits of such validity, and if under or from
any circumstances whatsoever Bank should ever receive as interest an amount
which would exceed the highest lawful rate, such amount which would be excessive
interest shall be applied to the reduction of the principal balance evidenced
hereby and not to the payment of interest. This provision shall control every
other provision of all agreements between Borrower and Bank.
13.14 JURISDICTION/VENUE. BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT
IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX LOCATED IN MONROE COUNTY OR ANY FEDERAL
COURT SITTING THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH
COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON BORROWER BY MAIL
AT THE ADDRESS SET FORTH FOR NOTICES GIVEN UNDER THIS AGREEMENT. BORROWER HEREBY
WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH
SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM.
13.15 WAIVER OF TRIAL BY JURY. BORROWER AND BANK (BY ACCEPTANCE OF THIS
AGREEMENT) MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE
RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF,
UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS OR, ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF ANY PARTY, INCLUDING WITHOUT LIMITATION, ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF BANK RELATING TO THE ADMINISTRATION
OF THE LOAN OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NEITHER PARTY
WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY
TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, BORROWER
HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY
SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER
THAN, OR IN ADDITION TO, ACTUAL DAMAGES. BORROWER CERTIFIES THAT NO
REPRESENTATIVE, AGENT, OR ATTORNEY OF BANK HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT BANK WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR BANK TO
ACCEPT THIS AGREEMENT AND MAKE THE LOANS CONTEMPLATED HEREUNDER.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives as of the date first above written.
34
BANK OF AMERICA, N.A.
By: ___________________________________
Title: ________________________________
XXXXXX CORPORATION
By: ___________________________________
Title: ________________________________
35
INDEX TO SCHEDULES
SCHEDULE 6.1 Liens and Encumbrances
SCHEDULE 7.1 Affiliates and Subsidiaries
SCHEDULE 7.4 Litigation
SCHEDULE 7.9 Obligations
SCHEDULE 7.11 Pension Plans
SCHEDULE 9.4 Insurance
INDEX TO EXHIBITS
EXHIBIT A Revolving Line Note
EXHIBIT B Term Loan Note
36
EXHIBIT A
AMENDED AND RESTATED REVOLVING LINE NOTE
$13,000,000.00 July 12, 2005
Unless otherwise expressly provided herein, all capitalized terms in
this Revolving Line Note shall have the meanings given to them in the Amended
and Restated Credit Facility Agreement of even date herewith between the
undersigned, Xxxxxx Corporation ("Borrower") and Bank of America, N.A. ("Bank"),
as the same may be amended, extended, replaced, or modified from time to time
(the "Credit Agreement").
FOR VALUE RECEIVED, XXXXXX CORPORATION hereby promises to pay to the order
of BANK OF AMERICA, N.A. at Xxx Xxxx Xxxxxx, Xxxxxxxxx, Xxx Xxxx 00000, or at
such other places as Bank may specify in writing to Borrower, the principal sum
of Thirteen Million Dollars ($13,000,000.00) or, if less, the aggregate unpaid
principal amount of all Revolving Line advances made by Bank to Borrower. The
Bank shall maintain a record of amounts of principal and interest payable by
Borrower from time to time, and the records of Bank maintained in the ordinary
course of business shall be prima facie evidence of the existence and amounts of
the Borrower's obligations recorded therein. In addition, Bank may mail or
deliver periodic statements to Borrower indicating the date and amount of each
advance hereunder (but any failure to do so shall not relieve Borrower of the
obligation to repay any advance). Unless Borrower questions the accuracy of an
entry on any periodic statement within thirty business days after such mailing
or delivery by Bank, Borrower shall be deemed to have accepted and be obligated
by the terms of each such periodic statement as accurately representing the
advances hereunder. In the event of transfer of this Revolving Line Note, or if
the Bank shall otherwise deem it appropriate, Borrower hereby authorizes Bank to
endorse on this Revolving Line Note the amount of advances and payments to
reflect the principal balance outstanding from time to time. Bank is hereby
authorized to honor borrowing and other requests received from purported
representatives of Borrower orally, by telecopy, in writing, or otherwise. Oral
requests shall be conclusively presumed to have been made by an authorized
person and Bank's crediting of Borrower's account with the amount requested
shall conclusively establish Borrower's obligation to repay the amount advanced.
INTEREST. Outstanding amounts under this Revolving Line Note shall
bear interest, except as otherwise specifically provided herein, at a variable
rate per annum equal to the Prime Rate in effect from time to time minus the
Applicable Prime Rate Margin. Changes in the interest rate shall become
effective automatically and without notice at the time of changes in the Prime
Rate.
The Borrower from time to time, however, may elect to have portions
of the principal outstanding under this Revolving Line Note bear interest at the
fixed per annum rate equal to the one-month, two-month, or three- month LIBOR
Rate plus the Applicable LIBOR Margin for the period applicable to that rate by
giving at least two (2) business days' prior notice
37
in writing or by telecopy to the Bank. The notice shall specify (i) the rate
chosen, (ii) the outstanding principal amount to bear interest at the applicable
LIBOR Rate (with any outstanding amounts from time to time under this Revolving
Line Note, in excess of such specified amount, to bear interest at the rate
based upon the Prime Rate), and (iii) the commencement date for such rate. No
LIBOR Interest Period may be elected that would extend beyond the maturity date
of this Revolving Line Note. The rate of interest so elected shall be in effect
for the respective applicable LIBOR Interest Period. The Borrower shall be
responsible for all Break Costs including without limitation those applicable if
during any period in which a LIBOR based rate or rates is or are in effect, if
the principal amount outstanding under this Revolving Line Note bearing interest
at such respective rate or rates is ever less than the principal amount stated
in the respective election notice or notices for such period.
Interest shall be calculated on the basis of a 360 day year and using the
actual number of days elapsed. Interest shall continue to accrue after maturity
(including after acceleration and judgment) at the rate required by this
Revolving Line Note until this Revolving Line Note is paid in full.
The rate of interest on this Revolving Line Note may be increased under
the circumstances provided in the Credit Agreement. The right of Bank to receive
such increased rate of interest shall not constitute a waiver of any other right
or remedy of Bank.
PAYMENTS. Payments of all accrued interest under this Revolving Line Note
shall be due on the first day of each month.
All remaining outstanding principal and accrued interest shall be due and
payable in full upon the earlier of (a) at the option of the Bank, upon written
notice to Borrower, an Event of Default, or (b) the Revolving Line Termination
Date, provided that under certain circumstances, some or all of the principal
amounts outstanding under this Revolving Line Note may be converted to a Term
Loan in accordance with the terms of Article 4 of the Credit Agreement.
In the event the Borrower becomes aware, or receives notice (oral or
written) from the Bank, that principal amounts outstanding under this Revolving
Line Note exceed the maximum available amount described herein at any time,
Borrower promptly shall make a principal payment to the Bank sufficient to
reduce outstanding principal amounts to the maximum amount available hereunder.
All payments shall be made by Borrower to Bank at the address for Bank
first shown above in this Revolving Line Note or such other place as Bank may
from time to time specify in writing in lawful currency of the United States of
America in immediately available funds, without counterclaim or setoff and free
and clear of, and without deduction or withholding for, any taxes or other
payments. All payments shall be applied first to the payment of all fees,
expenses and other amounts due to the Bank (excluding principal and interest),
then to accrued interest, and the balance on account of outstanding principal;
provided, however, that after an Event of Default or demand for payment in full,
payments will be applied to the obligations of Borrower to the Bank as Bank
determines in its sole discretion.
38
LATE CHARGE. If the entire required amount of principal and/or interest is
not paid in full within ten (10) days after the same is due, Borrower shall pay
to Bank a late fee equal to five percent (5%) of the overdue amount. Such late
charge shall be in addition to interest.
PREPAYMENT. This Revolving Line Note is prepayable to the extent allowed
by, and on the terms provided by the Credit Agreement.
MAXIMUM RATE. All agreements between Borrower and Bank are hereby
expressly limited so that in no contingency or event whatsoever, whether by
reason of acceleration or maturity of the indebtedness evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to Bank for the use or the
forbearance of the indebtedness evidenced hereby exceed the maximum permissible
under applicable law. As used herein, the term "applicable law" shall mean the
law in effect as of the date hereof, provided, however that in the event there
is a change in the law which results in a higher permissible rate of interest,
then this Revolving Line Note shall be governed by such new law as of its
effective date. In this regard, it is expressly agreed that it is the intent of
Borrower and Bank in the execution, delivery and acceptance of this Revolving
Line Note to contract in strict compliance with the laws of the State of New
York from time to time in effect. If, under or from any circumstances
whatsoever, fulfillment of any provision hereof or of any of the documents and
agreements related hereto at the time performance of such provision shall be
due, shall involve transcending the limit of such validity prescribed by
applicable law, then the obligation to be fulfilled shall automatically be
reduced to the limits of such validity, and if under or from any circumstances
whatsoever Bank should ever receive as interest an amount which would exceed the
highest lawful rate, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced hereby and not to
the payment of interest. This provision shall control every other provision of
all agreements between Borrower and Bank.
BUSINESS DAYS. If this Revolving Line Note or any payment hereunder
becomes due on a day other than a Business Day, payment shall be extended to the
next succeeding Business Day, but any interest or fees shall be calculated based
upon the actual time of payment.
EVENTS OF DEFAULT. This Revolving Line Note shall become immediately due
and payable in full, without further presentment, protest, notice or demand,
upon the happening of any Event of Default as provided in the Credit Agreement.
DEFAULT RATE. Upon Default or after maturity or after judgment has been
rendered with respect to the Obligations, or upon an Event of Default, the
unpaid principal of all Obligations shall, at the option of the Bank, bear
interest at a rate which is four (4) percentage points per annum greater than
that which would otherwise be applicable.
SET OFF. The Borrower hereby grants to Bank a continuing lien, security
interest, and right of set off as security for the Obligations, whether now
existing or hereafter arising, upon and against all deposits, credits,
collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Bank or any entity under the control of Bank of
America Corporation and its successors and assigns or in transit to any of them.
At any time during the existence of a Default or Event of Default, without
demand or notice (any such notice being
39
expressly waived by Borrower), Bank may set off the same or any part thereof and
apply the same to any Obligation of Borrower even though unmatured and
regardless of the adequacy of any other collateral securing the Obligations. ANY
AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT
TO ANY OTHER COLLATERAL WHICH SECURES THE OBLIGATIONS, PRIOR TO EXERCISING ITS
RIGHT OF SET OFF WITH RESPECT TO SUCH DEPOSITS, CREDITS, OR OTHER PROPERTY OF
BORROWER ARE HEREBY KNOWINGLY, VOLUNTARILY, AND IRREVOCABLY WAIVED.
MODIFICATION OF TERMS. The terms of this Revolving Line Note cannot be
changed, nor may this Revolving Line Note be discharged in whole or in part,
except by a writing executed by Bank. In the event that Bank demands or accepts
partial payments of this Revolving Line Note, such demand or acceptance shall
not be deemed to constitute a waiver of the right to demand the entire unpaid
balance of this Revolving Line Note at any time in accordance with the terms
hereof. Any delay or omission by Bank in exercising any rights hereunder shall
not operate as a waiver of such rights.
COSTS AND EXPENSES. Borrower shall pay on demand all reasonable expenses
of Bank in connection with the preparation, administration, default, collection,
waiver or amendment of loan terms, or in connection with Bank's exercise,
preservation, or enforcement of any of its rights, remedies, or options
hereunder, including without limitation, fees of outside legal counsel or the
allocated costs of in-house legal counsel, accounting, consulting, brokerage or
similar professional fees or expenses, and any fees or expenses associated with
travel or other costs relating to any appraisals or examinations conducted in
connection with any loan or any collateral therefor, and the amount of all such
expenses shall, until paid, bear interest at the rate applicable to principal
hereunder (including any default rate) and be an obligation secured by any
collateral.
ASSIGNMENT/PARTICIPATION. All the terms and provisions of this Revolving
Line Note shall inure to the benefit of and be binding upon and be enforceable
by the parties and their respective successors and permitted assigns and shall
inure to the benefit of and be enforceable by any holder hereof.
The Bank may at any time pledge or assign all or any portion of its rights
under this Revolving Line Note to any of the twelve (12) Federal Reserve Banks
organized under Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No
such pledge or assignment or enforcement thereof shall release Bank from its
obligations under any of this Revolving Line Note or any other loan documents.
The Bank shall have the unrestricted right at any time or from time to
time, and without Borrower's consent, to assign all or any portion of its rights
and obligations hereunder to one or more banks or other financial institutions
(each an "Assignee"), and Borrower agrees that it shall execute, or cause to be
executed, such documents, including without limitation, amendments to this
Revolving Line Note and to any other loan documents, as the Bank shall deem
necessary to effect the foregoing. In addition, at the request of the Bank and
any such Assignee, Borrower shall issue one or more new promissory notes, as
applicable, to any such Assignee and, if Bank
40
has retained any of its rights and obligations hereunder following such
assignment, to Bank, which new promissory notes shall be issued in replacement
of, but not in discharge of, the liability evidenced by the promissory note held
by Bank prior to such assignment and shall reflect the amount of the respective
commitments and loans held by such Assignee and Bank after giving effect to such
assignment. Upon the execution and delivery of appropriate assignment
documentation, amendments, and any other documentation required by Bank in
connection with such assignment, and the payment by Assignee of the purchase
price agreed to by Bank and such Assignee, such Assignee shall be a party to
this agreement and shall have all of the rights and obligations of the Bank
hereunder (and under any and all other loan documents) to the extent that such
rights and obligations have been assigned by the Bank pursuant to the assignment
documentation between the Bank and such Assignee, and Bank shall be released
from its obligations hereunder and thereunder to a corresponding extent.
The Bank shall have the unrestricted right at any time and from time to
time, and without the consent of or notice to Borrower, to grant to one or more
banks or other financial institutions (each a "Participant") participating
interests in Bank's obligation to lend hereunder and/or any or all of the loans
held by Bank hereunder. In the event of any such grant by Bank of a
participating interest to Participant, whether or not upon notice to Borrower,
Bank shall remain responsible for the performance of its obligations hereunder
and Borrower shall continue to deal solely and directly with Bank in connection
with Bank's rights and obligations hereunder.
The Bank may furnish any information concerning Borrower in its possession
from time to time to prospective Assignees and Participants, provided that the
Bank shall require any such prospective Assignee or Participant to agree in
writing to maintain the confidentiality of such information.
LOSS OR MUTILATION. Upon receipt of an affidavit of an officer of Bank as
to the loss, theft, destruction, or mutilation of this Revolving Line Note, and,
in the case of any such loss, theft, destruction or mutilation, upon
cancellation of this Revolving Line Note, Borrower will issue, in lieu thereof,
a replacement note or other loan document in the same principal amount thereof
and otherwise of like tenor.
REGULATION U. No portion of the proceeds of this Revolving Line Note shall
be used, in whole or in part, for the purpose of purchasing or carrying any
"margin stock" as such term is defined in Regulation U of the Board of Governors
of the Federal Reserve System.
MISCELLANEOUS. To the fullest extent permissible by law, Borrower waives
presentment, demand for payment, protest, notice of nonpayment, and, except as
otherwise provided in the Credit Agreement, all other demands or notices
otherwise required by law in connection with the delivery, acceptance,
performance, default, or enforcement of this Revolving Line Note. Borrower
consents to extensions, postponements, indulgences, substitutions or releases of
collateral, and substitutions or releases of other parties primarily or
secondarily liable herefor, and agrees that none of the same shall affect
Borrower's obligations under this Revolving Line Note which shall be
unconditional.
41
CHOICE OF LAW. This Revolving Line Note and the rights and obligations of
the parties hereunder, shall be construed, interpreted, governed and enforced in
accordance with the laws of the State of New York (excluding the laws applicable
to conflicts or choice of law).
ENFORCEMENT/WAIVER OF JURY TRIAL. BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS REVOLVING LINE NOTE OR ANY OF THE OTHER LOAN DOCUMENTS MAY
BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX LOCATED IN MONROE COUNTY OR
ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION
OF SUCH COURT. BORROWER HEREBY WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER
HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS
BROUGHT IN AN INCONVENIENT FORUM.
BORROWER AND BANK (BY ACCEPTANCE OF THIS REVOLVING LINE NOTE) MUTUALLY
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY
JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN
CONNECTION WITH THIS REVOLVING LINE NOTE OR ANY OTHER LOAN DOCUMENTS OR ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR
ACTIONS OF ANY PARTY, INCLUDING WITHOUT LIMITATION, ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF BANK RELATING TO THE ADMINISTRATION
OF THE LOAN OR ENFORCEMENT OF THIS REVOLVING LINE NOTE OR THE LOAN DOCUMENTS,
AND AGREE THAT NEITHER PARTY WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY
OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS
PROHIBITED BY LAW, BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL
DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. BORROWER
CERTIFIES THAT NO REPRESENTATIVE, AGENT, OR ATTORNEY OF BANK HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT BANK WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO
ENFORCE THE FOREGOING WAIVER. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR
BANK TO ACCEPT THIS REVOLVING LINE NOTE AND MAKE THE LOANS CONTEMPLATED
HEREUNDER.
XXXXXX CORPORATION
By: ___________________________________
Title: ________________________________
42
EXHIBIT B
TERM LOAN NOTE
$___________________ Date: ___________, 200_
Unless otherwise expressly provided herein, all capitalized terms in this
Term Loan Note shall have the meanings given to them in the Amended and Restated
Credit Facility Agreement dated July __, 2005, between the undersigned, XXXXXX
CORPORATION ("Borrower") and BANK OF AMERICA, N.A. ("Bank"), as amended on the
date hereof and as the same may be additionally amended, extended, replaced, or
modified from time to time (the "Credit Agreement").
FOR VALUE RECEIVED, the Borrower hereby promises to pay to the Bank the
principal sum of____________________________ ($___________________________).
INTEREST. Outstanding amounts under this Term Loan Note shall
bear interest, except as otherwise specifically provided herein, at a variable
rate per annum equal to the Prime Rate in effect from time to time minus the
Applicable Prime Rate Margin. Changes in the interest rate shall become
effective automatically and without notice at the time of changes in the Prime
Rate.
The Borrower from time to time, however, may elect to have portions
of the principal outstanding under this Term Loan Note bear interest at the
fixed per annum rate equal to the one-month, two-month, or three- month LIBOR
Rate plus the Applicable LIBOR Margin for the period applicable to that rate by
giving at least two (2) business days' prior notice in writing or by telecopy to
the Bank. The notice shall specify (i) the rate chosen, (ii) the outstanding
principal amount to bear interest at the applicable LIBOR Rate (with any
outstanding amounts from time to time under this Term Loan Note, in excess of
such specified amount, to bear interest at the rate based upon the Prime Rate),
and (iii) the commencement date for such rate. No LIBOR Interest Period may be
elected that would extend beyond the maturity date of this Term Loan Note. The
rate of interest so elected shall be in effect for the respective applicable
LIBOR Interest Period. The Borrower shall be responsible for all Break Costs
including without limitation those applicable if during any period in which a
LIBOR based rate or rates is or are in effect, if the principal amount
outstanding under this Term Loan Note bearing interest at such respective rate
or rates is ever less than the principal amount stated in the respective
election notice or notices for such period.
Interest shall continue to accrue after maturity, acceleration, and
judgment at the rate required hereby until this Term Loan Note is paid in full.
All computations of interest shall be made on the basis of a three hundred sixty
(360) day year and the actual number of days elapsed.
43
The rate of interest on this Term Loan Note may be increased under the
circumstances provided in the Credit Agreement. The right of Bank to receive
such increased rate of interest shall not constitute a waiver of any other right
or remedy of Bank.
PAYMENTS. Payments of all accrued interest under this Term Loan Note shall
be due on the first day of each month, commencing on __________, 20__. In
addition, monthly principal payments, each equal to $____________, shall be due
on the first day of each month, commencing on ___________, 20__. All remaining
outstanding principal and accrued interest under this Term Loan Note shall be
due and payable in full on_______________________.
All payments shall be made by Borrower to Bank at the address for Bank
first shown above or such other place as Bank may from time to time specify in
writing in lawful currency of the United States of America in immediately
available funds, without counterclaim or setoff and free and clear of, and
without deduction or withholding for, any taxes or other payments.
All payments shall be applied first to the payment of all fees, expenses
and other amounts due to the Bank (excluding principal and interest), then to
accrued interest, and the balance on account of outstanding principal; provided,
however, that after default, payments will be applied to the obligations of
Borrower to Bank as Bank determines in its sole discretion.
LATE CHARGE. If the entire amount of any required principal and/or
interest payment is not paid in full within ten (10) days after the same is due,
Borrower shall pay to the Bank a late fee equal to five percent (5%) of the
overdue amount.
PREPAYMENT. This Term Loan Note is prepayable to the extent allowed by,
and on the terms provided by the Credit Agreement.
MAXIMUM RATE. All agreements between Borrower and Bank are hereby
expressly limited so that in no contingency or event whatsoever, whether by
reason of acceleration of maturity of the indebtedness evidenced hereby or
otherwise, shall the amount paid or agreed to be paid to Bank for the use or the
forbearance of the indebtedness evidenced hereby exceed the maximum permissible
under applicable law. As used herein, the term "applicable law" shall mean the
law in effect as of the date hereof provided, however that in the event there is
a change in the law which results in a higher permissible rate of interest, then
this Note shall be governed by such new law as of its effective date. In this
regard, it is expressly agreed that it is the intent of Borrower and Bank in the
execution, delivery and acceptance of this Note to contract in strict compliance
with the laws of the State of New York from time to time in effect. If, under or
from any circumstances whatsoever, fulfillment of any provision hereof or of any
of the related loan documents or security documents at the time of performance
of such provision shall be due, shall involve transcending the limit of such
validity prescribed by applicable law, then the obligation to be fulfilled shall
automatically be reduced to the limits of such validity, and if, under or from
circumstances whatsoever Bank should ever receive as interest an amount which
would exceed the highest lawful rate, such amount which would be excessive
interest shall be applied to the reduction of the principal balance evidenced
hereby and not to the payment of interest. This provision shall control every
other provision of all agreements between Borrower and Bank.
44
HOLIDAYS. If this Note or any payment hereunder becomes due on a Saturday,
Sunday or other holiday on which Bank is authorized to close, the due date for
the Note or payment shall be extended to the next succeeding business day, but
any interest or fees shall be calculated based upon the actual time of payment.
EVENTS OF DEFAULT. This Term Loan Note shall become immediately due and
payable in full, without further presentment, protest, notice, or demand, upon
the happening of any Event of Default as provided in the Credit Agreement.
DEFAULT RATE. Upon any Default or after maturity or after judgment has
been rendered with respect to the Obligations, or upon an Event of Default, the
unpaid principal of all Obligations shall, at the option the Bank, bear interest
at a rate which is four (4) percentage points per annum greater than that which
would otherwise be applicable.
SET-OFF. Borrower hereby grants to Bank, a lien, security interest and
right of setoff as security for all liabilities and obligations to Bank, whether
now existing or hereafter arising, upon and against all deposits, credits,
collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Bank or any entity under the control of Bank of
America Corporation, its successors and assigns, or in transit to any of them.
At any time during the existence of a Default or Event of Default, without
demand or notice, Bank may set off the same or any part thereof and apply the
same to any liability or obligation of Borrower even though unmatured and
regardless of the adequacy of any other collateral securing the Loan. ANY AND
ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO
ANY OTHER COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF
SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE BORROWER
OR ANY GUARANTOR, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
MODIFICATION OF TERMS. The terms of this Term Loan Note cannot be changed,
nor may this Note be discharged in whole or in part, except by a writing
executed by Bank. In the event that Bank demands or accepts partial payments of
this Term Loan Note, such demand or acceptance shall not be deemed to constitute
a waiver of the right to demand the entire unpaid balance of this Term Loan Note
at any time in accordance with the terms hereof. Any delay or omission by Bank
in exercising any rights hereunder shall not operate as a waiver of such rights.
MISCELLANEOUS. To the fullest extent permissible by law, Borrower waives
presentment, demand for payment, protest, notice of non-payment, and except as
otherwise provided in the Credit Agreement, all other demands or notices
otherwise required by law in connection with the delivery, acceptance,
performance, default, or enforcement of this Term Loan Note. Borrower consents
to extensions, postponements, indulgences, substitutions or releases of
collateral, and substitutions or releases of other parties primarily or
secondarily liable herefor, and agrees that none of the same shall affect
Borrower's obligations under this Term Loan Note which shall be unconditional.
COLLECTION COSTS. Borrower shall pay on demand all reasonable expenses of
Bank in connection with the preparation, administration, default, collection,
waiver or amendment of loan
45
terms, or in connection with Bank's exercise, preservation or enforcement of any
of its rights, remedies or options hereunder, including, without limitation,
fees of outside legal counsel or the allocated costs of in-house legal counsel,
accounting, consulting, brokerage or other similar professional fees or
expenses, and any fees or expenses associated with travel or other costs
relating to any appraisals of examinations conducted in connection with the loan
evidenced by this Term Loan Note of any collateral therefor, and the amount of
all such expenses shall, until paid, bear interest at the rate applicable to
principal hereunder (including any default rate) and be an obligation secured by
any collateral.
LOSS OR MUTILATION. Upon receipt of an affidavit of an officer of Bank as
to the loss, theft, destruction, or mutilation of this Term Loan Note, and, in
the case of any such loss, theft, destruction or mutilation, upon cancellation
of this Term Loan Note, Borrower will issue, in lieu thereof, a replacement note
in the same principal amount thereof and otherwise of like tenor.
CHOICE OF LAW. This Term Loan Note, and the rights and obligations of the
parties hereunder, shall be construed, interpreted, governed and enforced in
accordance with the laws of the State of New York (excluding the laws applicable
to conflicts or choice of law).
ENFORCEMENT/WAIVER OF JURY TRIAL. BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS TERM LOAN NOTE MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX
XXX XXXX LOCATED IN MONROE COUNTY OR ANY FEDERAL COURT SITTING THEREIN AND
CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS
IN ANY SUCH SUIT BEING MADE UPON BORROWER BY MAIL AT THE ADDRESS SET FORTH FOR
NOTICES GIVEN UNDER THE CREDIT AGREEMENT. BORROWER HEREBY WAIVES ANY OBJECTION
THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH
COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT FORUM.
BORROWER AND BANK (BY ACCEPTANCE OF THIS TERM LOAN NOTE) MUTUALLY HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN
RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS NEW TERM LOAN NOTE OR ANY OTHER LOAN DOCUMENTS OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY, INCLUDING WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF BANK RELATING TO THE ADMINISTRATION OF THE LOAN OR
ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NEITHER PARTY WILL SEEK TO
CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT
BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, BORROWER HEREBY WAIVES
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL ,
EXEMPLARY, PUNITIVE, OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN
ADDITION TO, ACTUAL DAMAGES. BORROWER CERTIFIES THAT NO REPRESENTATIVE, AGENT,
OR ATTORNEY OF BANK HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT BANK WOULD
NOT, IN THE
46
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. THIS
WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR BANK TO ACCEPT THIS TERM LOAN NOTE
AND MAKE THE LOAN CONTEMPLATED HEREUNDER.
XXXXXX CORPORATION
By:_____________________________
Title:____________________________
47
