Exhibit 4(f)
AMENDED AND RESTATED CREDIT AGREEMENT
-------------------------------------
Dated as of October 1, 1997
among
ALPHA INDUSTRIES, INC.,
TRANS-TECH, INC., as Borrowers,
FLEET NATIONAL BANK, as a Bank and as Agent
and
SILICON VALLEY BANK, as a Bank
______________________________
Working Capital Line of Credit Loans
$7,500,000
Equipment Line of Credit Loans
$5,000,000
1997 Equipment Line of Credit Loans
$7,500,000
________________________________
TABLE OF CONTENTS
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Section 1 Working Capital Line of Credit Loans 1
1.1 Amount 1
1.2 Working Capital Line of Credit Commitments 1
1.3 Working Capital Line of Credit Notes 1
1.4 Requests For Line of Credit Loans 2
1.5 Working Capital Borrowing Base 2
1.6 Maturity Date of Working Capital Line of Credit Loans 2
1.7 Termination of Working Capital Line Commitment 2
1.8 Letters of Credit 2
Section 2 Equipment Line of Credit Loans 3
2.1 Amount 3
2.2 Equipment Notes 3
2.3 Requests For Equipment Line Loans 3
2.4 Restrictions on Advances 3
2.5 Maturity Date of Equipment Line Loans 3
2.6 Termination of Equipment Line Commitment 3
Section 2A 1997 Equipment Line of Credit Loans. 3
2A.1 Amount 3
2A.2 1997 Equipment Line Note 4
2A.3 Requests For 1997 Equipment Line Loans 4
2A.4 Restrictions on Advances 4
2A.5 Maturity Date of 1997 Equipment Line Loans. 4
2A.6 Termination of 1997 Equipment Line Commitment 4
Section 3 Interest Rates; Payments and Optional Prepayments 4
3.1 Interest Rates 4
3.2 Manner and Place of Payment 7
3.3 Payments Due on Saturdays, Sundays and Holidays 7
3.4 Computations 7
3.5 Minimum and Maximum Amounts. 7
3.6 Certain Notices 7
3.7 Additional Costs 8
3.8 Limitation on Types of Loans 9
3.9 Illegality. 9
3.10 Substitute Prime Rate Loans. 9
3.11 Compensation 9
3.12 Capital Adequacy 10
3.13 Optional Prepayments 11
Section 4 Security and Guaranties 11
4.1 Security Interests 11
4.2 Guaranty 11
Section 5 Conditions Precedent 12
5.1 This Agreement, the Borrower Notes and the Security Instruments 12
5.2 No Default 12
5.3 Correctness of Representations 12
5.4 Opinion of Counsel for the Borrowers 12
5.5 Governmental Approvals 12
5.6 Filing of Financing Statements, etc 12
5.7 Supporting Documents 12
5.8 Facility Fees 13
5.9 Legal Matters 13
Section 6 Representations and Warranties 13
6.1 Corporate Status 13
6.2 No Violation 14
6.3 Corporate Power and Authority 14
6.4 Enforceability 14
6.5 Governmental Approvals 14
6.6 Financial Statements 14
6.7 No Material Change 15
6.8 Litigation 15
6.9 Compliance with Other Instruments; Compliance with Law 15
6.10 Subsidiaries 15
6.11 Investment Borrower Status; Limits on Ability to Incur Indebtedness 15
6.12 Title to Property 15
6.13 ERISA 16
6.14 Taxes 16
6.15 Environmental Matters 16
6.16 Intellectual Property 17
6.17 Working Capital Borrowing Base 17
Section 7 Affirmative Covenants 17
7.1 Maintenance of Existence 17
7.2 Taxes and Other Liens 17
7.3 Insurance 17
7.4 Financial Statements, Etc 18
7.5 Notice of Default 19
7.6 Environmental Matters 19
7.7 ERISA Information 20
7.8 Inspection 20
7.9 Use of Proceeds 20
7.10 Further Assurances 20
7.11 Subsidiaries 20
7.12 Intellectual Property 21
Section 8 Negative Covenants 21
8.1 ERISA 21
8.2 Transactions with Affiliates 21
8.3 Consolidation, Merger or Acquisition 21
8.4 Disposition of Assets 22
8.5 Indebtedness 22
8.6 Liens 22
8.7 Restricted Payments 23
8.8 Investments 23
8.9 Sale and Leaseback 24
8.10 Additional Stock Issuance by Subsidiaries 24
8.11 Quick Ratio 24
8.12 Minimum Profitability 24
8.13 Leverage 25
8.14 Capital Expenditures. 25
8.15 Exception for Building 25
Section 9 Events of Default 25
9.1 Events of Default 25
9.2 Remedies Upon an Event of Default 27
Section 10 The Agent 27
10.1 Appointment of Agent; Powers and Immunities 27
10.2 Actions By Agent 28
10.3 Indemnification 28
10.4 Reimbursement 28
10.5 Non-Reliance on Agent and Other Banks 29
10.6 Resignation or Removal of Agent 29
10.7 Ratable Sharing 29
Section 11 Definitions 30
11.1 Certain Definitions 30
Section 12 Miscellaneous 40
12.1 Accounting Terms and Definitions 40
12.2 Amendments, Etc 40
12.3 Notices, Etc 40
12.4 No Waiver; Remedies 41
12.5 Right of Set-off 41
12.6 Expenses; Indemnification 41
12.7 Binding Effect 42
12.8 Severability 42
12.9 Governing Law 42
12.10 Waiver of Jury Trial 42
12.11 Venue, Consent to Service of Process 42
12.12 Headings 43
12.13 Counterparts 43
12.14 Joint and Several Obligations 43
Exhibits
A-1 - Working Capital Line of Credit Note (SVB)
A-2 - Working Capital Line of Credit Note (Fleet)
A-3 - 1997 Equipment Line of Credit Note
B - Amendment to Security and Guaranty Agreements
C - Compliance Certificate
D - Borrowing Base Certificate
Schedules
- Disclosure Schedule
- Schedule of Approved Foreign Account Debtors
AMENDED AND RESTATED CREDIT AGREEMENT
This AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 1, 1997
(the "Agreement") by and among ALPHA INDUSTRIES, INC., a Delaware corporation
---------
with its principal place of business at 00 Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 ("Alpha"), TRANS-TECH, INC., a Maryland corporation with its principal
-----
place of business at 0000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxx ("Trans-Tech"),
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and FLEET NATIONAL BANK, successor in interest to Fleet Bank of Massachusetts,
N.A., a national banking association with its principal place of business at
Fleet Center, 00 Xxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-0000 (together with
its successors, "Fleet"), and SILICON VALLEY BANK, a California-chartered bank,
-----
with its principal place of business at 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx,
Xxxxxxxxxx 00000 and with a loan production office located at Wellesley Xxxxxx
Xxxx, 00 Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxxxxxx 00000, doing business under
the name "Silicon Valley East" (together with its successors, "SVB"). Alpha and
---
Trans-Tech are sometimes each referred to herein as a "Borrower" and together as
--------
the "Borrowers". SVB and Fleet are sometimes each referred to herein as a
---------
"Bank") and collectively as the "Banks." Fleet in its capacity as agent for the
---- -----
Banks is referred to herein as the "Agent". This Agreement amends and restates
-----
in its entirety that certain Credit Agreement, to which both the Borrowers and
the Banks are parties, dated as of September 29, 1995, as amended as of July 31,
1996, September 30, 1996 and June 12, 1997 (the "1995 Credit Agreement").
---------------------
Section Working Capital Line of Credit Loans.
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. Amount. Subject to and upon the terms and conditions set forth
------
below, each of the Banks severally agrees to make loans (each a "Working Capital
---------------
Line of Credit Loan" and collectively, the "Working Capital Line of Credit
------------------- ------------------------------
Loans") to the Borrowers under this Section 1.1 from time to time to and
including September 30, 1999 (the "Working Capital Commitment Expiration Date"),
------------------------------------------
unless earlier terminated pursuant to Section 1.7, in an aggregate principal
amount not to exceed at any one time outstanding their respective Working
Capital Line of Credit Commitments as set forth in Section 1.2 below (together,
the "Total Working Capital Line Commitment"), subject to the limitation set
-------------------------------------
forth in Section 1.5. Within the limit of the Working Capital Line Commitment,
the Borrowers may borrow, repay and reborrow at any time or from time to time
until the Working Capital Commitment Expiration Date, or the termination of the
Working Capital Line Commitment, whichever occurs earlier.
. Working Capital Line of Credit Commitments. The Total Working
------------------------------------------
Capital Line Commitment shall be $7,500,000 in the aggregate; the Working
Capital Line Commitment of SVB shall be $3,750,000; and the Working Capital Line
Commitment of Fleet shall be $3,750,000.
. Working Capital Line of Credit Notes. The Working Capital Line
------------------------------------
of Credit Loans made by each Bank shall be evidenced (i) in the case of SVB, by
a promissory note payable to the order of SVB with interest in accordance with
the terms of the Promissory Note of the Borrowers to be issued in substantially
the form of attached Exhibit A-1, dated the date hereof and (ii) in the case of
-----------
Fleet by a promissory note payable to the order of Fleet with interest in
accordance with the terms of the Promissory Note of the Borrowers to be issued
in substantially the form of attached Exhibit A-2, dated the date hereof (each a
-----------
"Working Capital Note" and together the "Working Capital Notes").
-------------------- ---------------------
. Requests For Line of Credit Loans. Whenever either Borrower
---------------------------------
desires to obtain a Working Capital Line of Credit Loan, such Borrower shall
notify Fleet in accordance with the provisions of 3.6 below. Not later than
1:00 p.m. (Boston time) on the date specified for the making of each such
Working Capital Line of Credit Loan, each Bank shall make available to Fleet, at
Fleet's principal office, an amount equal to such Bank's respective Working
Capital Commitment Percentage multiplied by the amount of the Working Capital
Line of Credit Loan requested as set forth above. Subject to the terms and
conditions of this Agreement, the amount so received by Fleet shall be made
available to the Borrowers by crediting the same in immediately available funds,
to Alpha's regular deposit account with Fleet.
. Working Capital Borrowing Base. The Borrowers shall not permit,
------------------------------
or request any advance or the issuance of any Letter of Credit hereunder that
would cause, the sum of (a) the aggregate unpaid principal amount of all Working
Capital Line of Credit Loans under the Total Working Capital Line Commitment and
(b) Aggregate Letter of Credit Usage (the sum of (a) and (b), the "Working
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Capital Extensions of Credit") to exceed at any time an amount equal to the
----------------------------
lesser of (i) the Total Working Capital Line Commitment or (ii) the sum of 80%
of all Eligible Domestic Accounts Receivable (after subtracting the Domestic
Delinquency Reserve Amount) and 80% of all Eligible International Accounts
Receivable (after subtracting the International Delinquency Reserve Amount) at
such time (the lesser of (i) and (ii), the "Working Capital Borrowing Base").
------------------------------
If at any time the aggregate principal amount of all Working Capital Extensions
of Credit exceeds the Working Capital Borrowing Base, the Borrowers shall, on
the next Banking Day, prepay such excess principal amount together with accrued
interest thereon at the applicable rate.
. Maturity Date of Working Capital Line of Credit Loans. All
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Working Capital Line of Credit Loans shall mature and the total unpaid principal
amount thereunder shall be due and payable on September 30, 1999 (the "Working
-------
Capital Line Maturity Date"), at which time all amounts advanced under this
--------------------------
Section 1 shall be immediately due and payable.
. Termination of Working Capital Line Commitment. The Borrowers,
----------------------------------------------
upon () notice to the Banks in accordance with the provisions of Section 3.6
and () the repayment in full of the outstanding principal balance of the Working
Capital Line of Credit Loans (and accrued interest thereon) and the payment in
full of the unpaid balance of the Facility Fee provided for in Section 5.8
through the Working Capital Commitment Expiration Date together with any
expenses or other fees owed by the Borrowers to the Banks under or pursuant to
this Agreement, may elect to permanently terminate the Total Working Capital
Line Commitment.
. Letters of Credit.
-----------------
(a) The Borrowers may use up to $2,000,000 of the Working Capital
Line of Credit Commitment for Letters of Credit to be issued by Fleet, provided
--------
that in each case (a) the relevant Borrower executes and delivers a letter of
credit application and reimbursement agreement satisfactory to Fleet and
complies with any conditions to the issuance of such Letter of Credit (including
payment of any applicable fees); (b) Fleet has approved the form of such Letter
of Credit and the purpose of its issuance; (c) such Letter of Credit bears an
expiration date not later than 45 days prior to the Commitment Expiration Date;
and (d) the conditions set forth in Sections 5.2 and 5.3 shall have been
satisfied as of the date of the issuance of the Letter of Credit.
(b) Effective upon the issuance of each Letter of Credit and without
any further action of any Bank in respect thereof, Fleet hereby grants to SVB,
and SVB hereby acquires from Fleet, a participating interest in such Letter of
Credit to the extent of SVB's Working Capital Commitment Percentage thereof (the
"Letter of Credit Participation"), and SVB agrees that it shall be absolutely
------------------------------
liable, without regard to any Default or Event of Default, to the extent of its
Working Capital Commitment Percentage, to reimburse Fleet on demand for the
amount of each draft paid by Fleet under each Letter of Credit to the extent
that such amount is not reimbursed by the Borrower, except to the extent such
deficiency is attributable to Fleet's gross negligence or intentional
misconduct. Fleet shall promptly notify SVB of the issuance of any Letter of
Credit under this Section 1.8.
Section Equipment Line of Credit Loans.
-----------------------------------------------
. Amount. Subject to and upon the terms and conditions set forth
------
below, Fleet agrees to make loans (each an "Equipment Line of Credit Loan") and
-----------------------------
collectively, the "Equipment Line of Credit Loans") to the Borrowers under this
------------------------------
Section 2.1 from time to time to and including August 31, 1996 (the "Equipment
---------
Line Commitment Expiration Date"), unless earlier terminated pursuant to
-------------------------------
Sections 2.6 or
9.2, in an aggregate amount not to exceed at any one time outstanding $5,000,000
(the "Equipment Line Commitment"), subject to the limitation set forth in
-------------------------
Section 2.4, 2.6(b).
. Equipment Notes. The Equipment Line of Credit Loans shall be
---------------
evidenced by and payable with interest in accordance with the note of the
Borrowers previously delivered to Fleet (the "Equipment Line Note").
-------------------
. Requests For Equipment Line Loans. Either Borrower may make
---------------------------------
requests of Fleet for Equipment Line of Credit Loans, and Fleet shall make such
loans in the same manner as provided in Section 1.4 and Section 3.6 with respect
to Working Capital Line of Credit Loans, except that together with the notice of
borrowing, such Borrower shall furnish to Fleet copies of all invoices for items
of Eligible Equipment and such other information as Fleet shall reasonably
request.
. Restrictions on Advances. Equipment Line of Credit Loans may be
------------------------
made only with respect to an item or items of Eligible Equipment specifically
identified in accordance with Section 2.3, 2.6(b), and the principal amount of
any such Equipment Line of Credit Loans may not exceed 80% of the invoice price
of such item or items of Eligible Equipment, not including prepackaged software
and soft costs, sales taxes, shipping charges, installation charges, training
charges and similar charges and expenses.
. Maturity Date of Equipment Line Loans. All Equipment Line of
-------------------------------------
Credit Loans shall be repayable in installments in accordance with the terms of
the Equipment Line Note, provided that all Equipment Line of Credit Loans shall
mature and the total principal amount thereunder shall be payable on August 1,
1999 (the "Equipment Line Maturity Date"), at which time all amounts advanced
----------------------------
under this Section 2, 2.6(b) shall be immediately due and payable.
. Termination of Equipment Line Commitment. The Borrowers, upon ()
----------------------------------------
notice to Fleet in accordance with the provisions of Section 3.6, and () the
repayment in full of the outstanding principal balance of the Equipment Line of
Credit Loans (and accrued interest thereon) and the payment in full of any
expenses or other fees owed by the Borrowers to Fleet under or pursuant to the
Equipment Line Commitment and the Equipment Line of Credit Loans, may elect to
permanently terminate the Equipment Line Commitment.
Section 2A 1997 Equipment Line of Credit Loans.
----------------------------------------------------
2A.1 Amount. Subject to and upon the terms and conditions set forth
------
below, Fleet agrees to make loans (each an "1997 Equipment Line of Credit Loan")
----------------------------------
and collectively, the "1997 Equipment Line of Credit Loans") to the Borrowers
-----------------------------------
under this Section 2A.1 from time to time to and including September 30, 1998
(the "1997 Equipment Line Commitment Expiration Date"), unless earlier
----------------------------------------------
terminated pursuant to Sections 2A.6 or 9.2, in an aggregate amount not to
exceed at any one time outstanding $7,500,000 (the "1997 Equipment Line
-------------------
Commitment"), subject to the limitation set forth in Section 2A.4.
----------
2A.2 1997 Equipment Line Note. The 1997 Equipment Line of Credit
------------------------
Loans shall be evidenced by and payable with interest in accordance with the
note of the Borrowers in the form of attached Exhibit A-3 (the "1997 Equipment
----------- --------------
Line Note"). The Working Capital Line Notes, the Equipment Line Note and the
---------
1997 Equipment Line Note are sometimes together referred to herein as the
"Borrower Notes".
---------------
2A.3 Requests For 1997 Equipment Line Loans. Either Borrower may
--------------------------------------
make requests of Fleet for 1997 Equipment Line of Credit Loans, and Fleet shall
make such loans in the same manner as provided in Section 1.4 and Section 3.6
with respect to Working Capital Line of Credit Loans, except that, together with
the notice of borrowing, such Borrower shall furnish to Fleet copies of all
invoices for items of Eligible Equipment and such other information as Fleet
shall reasonably request; provided, however, that
-------- -------
the Borrowers shall not make, and Fleet shall have no obligation to honor, more
than one (1) request, in the aggregate, for 1997 Equipment Line of Credit Loans
during any fiscal quarter and, provided, further, that any such request shall be
-------- -------
submitted to Fleet no later than 21 days after the beginning of such fiscal
quarter and shall relate only to purchases made on April 1, 1997 or thereafter.
2A.4 Restrictions on Advances. 1997 Equipment Line of Credit Loans
------------------------
may be made only with respect to an item or items of Eligible Equipment
specifically identified in accordance with Section 2A.3 and the principal amount
of any such 1997 Equipment Line of Credit Loans may not exceed 80% of the
invoice price of such item or items of Eligible Equipment, not including
prepackaged software and soft costs, sales taxes, shipping charges, installation
charges, training charges and similar charges and expenses.
2A.5 Maturity Date of 1997 Equipment Line Loans. All 1997 Equipment
------------------------------------------
Line of Credit Loans shall be repayable in installments in accordance with the
terms of the 1997 Equipment Line Note, provided that all 1997 Equipment Line of
-------- ----
Credit Loans shall mature and the total principal amount thereunder shall be
payable no later than September 30, 2002 (the "1997 Equipment Line Maturity
----------------------------
Date"), at which time all amounts advanced under this Section 2, 2.6(b)A shall
be immediately due and payable.
2A.6 Termination of 1997 Equipment Line Commitment. The Borrowers,
---------------------------------------------
upon (a) notice to Fleet in accordance with the provisions of Section 3.6, and
(b) the repayment in full of the outstanding principal balance of the 1997
Equipment Line of Credit Loans (and accrued interest thereon) and the payment in
full of any expenses or other fees owed by the Borrowers to Fleet under or
pursuant to the 1997 Equipment Line Commitment and the 1997 Equipment Line of
Credit Loans, may elect to permanently terminate the 1997 Equipment Line
Commitment.
Section Interest Rates; Payments and Optional Prepayments.
----------------------------------------------------------------
. Interest Rates.
--------------
() Working Capital Line of Credit Loans. The Borrowers agree to pay
------------------------------------
interest on the unpaid principal amount of each Working Capital Line of Credit
Loan for each day from and including the date such Working Capital Line of
Credit Loan was made to but excluding the date the principal on such Working
Capital Line of Credit Loan is due (whether at maturity, by acceleration or
otherwise), at the fluctuating rate per annum equal to the Prime Rate per annum,
plus the Applicable Prime Margin, which shall initially be 1/2% per annum. All
----
such Working Capital Line of Credit Loans shall constitute Prime Rate Loans for
purposes hereof.
() Equipment Line of Credit Loans and 1997 Equipment Line of Credit
----------------------------------------------------------------
Loans. The Borrowers agree to pay interest on the unpaid principal amount of
-----
each Equipment Line of Credit Loan and each 1997 Equipment Line of Credit Loan
for each day from and including the date such Equipment Line of Credit Loan or
1997 Equipment Line of Credit Loan was made to but excluding the date the
principal on such Equipment Line of Credit Loan or 1997 Equipment Line of Credit
Loan is due (whether at maturity, by acceleration or otherwise), at the
following fluctuating rates per annum:
() for Prime Rate Loans, at the Prime Rate per annum, plus the
----
Applicable Prime Margin, which shall initially be 1/2% per annum; and
() for LIBOR Loans, at the LIBOR Rate, plus the Applicable LIBOR
----
Margin, which shall initially be 300 basis points per annum.
() For purposes of hereof, "Applicable Prime Margin" and "Applicable
----------------------- ----------
LIBOR Margin" shall mean the interest rates per annum set forth below and
------------
determined based on the contingencies specified herein:
------------------------------------------------------------------------------------------------------------------
Applicable Prime Margin Applicable LIBOR Margin When Applicable
----------------------- ----------------------- ---------------
------------------------------------------------------------------------------------------------------------------
1/2% 300 basis points (i) During any fiscal quarter ending December 31,
1997 or thereafter (subject to further reduction
pursuant to (ii), (iii) and (iv) below).
------------------------------------------------------------------------------------------------------------------
1/4% 250 basis points (ii) During any fiscal quarter ending March 31,
1998 or thereafter (subject to further reduction
pursuant to (iii) and (iv) below), provided that Net
-------- ----
Income has been at least $500,000 per quarter for any
two consecutive fiscal quarters that ended September
30, 1997 or thereafter. If the Borrowers have
satisfied the full requirements of this test on one
occasion, any future failure to satisfy the test
shall not, except as set forth in Section 3.1(e)
below or in any other provision of any Loan Document,
result in an increase of the Applicable Prime Margin
or the Applicable LIBOR Margin.
------------------------------------------------------------------------------------------------------------------
0% 200 basis points (iii) During any fiscal quarter ending June 30,
1998 or thereafter (subject to further reduction
pursuant to (iv) below), provided that Net Income has
been at least $500,000 per quarter for any three
consecutive fiscal quarters that ended September 30,
1997 or thereafter. If the Borrowers have satisfied
the full requirements of this test on one occasion,
any future failure to satisfy the test shall not,
except as set forth in Section 3.1(e) below or in any
other provision of any Loan Document, result in an
increase of the Applicable Prime Margin or the
Applicable LIBOR Margin.
------------------------------------------------------------------------------------------------------------------
0% 150 basis points (iv) During any fiscal quarter ending September 30,
1998 or thereafter, provided that (A) cumulative Net
Income for the four consecutive fiscal quarters
immediately preceding such fiscal quarter is at least
$5,000,000 and (B) Net Income for each of the four
fiscal quarters immediately preceding such fiscal
quarter has been at least $1,000,000.
------------------------------------------------------------------------------------------------------------------
() The Borrowers shall have the option, exercisable at any time and
from time, but subject in each case to the notice requirements of Section 3.6
applicable to requests for Equipment Line of Credit Loans and 1997 Equipment
Line of Credit Loans that are to constitute Prime Rate Loans under Section
3.1(c)(i), to convert the interest rate applicable to some or all of the
Equipment Line of Credit Loans or the 1997 Equipment Line of Credit Loans then
outstanding from the fluctuating rate per annum specified in Section 3.1(c) to a
fixed rate of interest equal to the fluctuating rate of interest applicable to
such Equipment Line of Credit Loans or 1997 Equipment Line of Credit Loans as it
stands at the time of the Borrowers' notice to Fleet of conversion to the fixed
rate. Following such conversion, the fixed rate applicable to the portion of
the outstanding Equipment Line of Credit Loans or 1997 Equipment Line of Credit
Loans designated in such notice shall remain in effect until such indebtedness
has been paid in full. If the Borrowers pay any portion of the outstanding
principal amount of any such converted Equipment Line of Credit Loans or 1997
Equipment Line of Credit Loans other than on the last day of the relevant
interest period set forth in the relevant Equipment Line of Credit
Note or 1997 Equipment Line of Credit Note, the Borrowers shall pay to Fleet on
demand any amounts required to compensate Fleet for any losses, costs or
expenses which it may incur as a result of such prepayment.
() Notwithstanding the foregoing, the Borrowers will pay to the Banks
interest at the applicable Post-Default Rate on any principal of any Working
Capital Line of Credit Loan, any Equipment Line of Credit Loans or any 1997
Equipment Line of Credit Loan (collectively, the "Borrower Loans") and on any
--------------
other amount payable by the Borrowers hereunder (but, if such amount is
interest, only to the extent legally enforceable), which shall not be paid in
full when due (whether at stated maturity, by acceleration or otherwise), for
the period commencing on the due date thereof until the same is paid in full.
Accrued interest on each Prime Rate Loan and LIBOR Loan shall be payable monthly
in arrears on the first day of each month and in any event, upon the payment,
prepayment or conversion thereof, but only on the principal so paid or prepaid
or converted; provided that interest payable at the Post-Default Rate shall be
-------- ----
payable from time to time on demand of any Bank. Promptly after the
determination of any interest rate provided for herein or any change therein,
each Bank shall notify the Borrowers thereof.
Notwithstanding the foregoing provisions of this Section 3.1, if at
any time the rate of interest set forth above (the "Stated Rate") exceeds the
-----------
maximum non-usurious interest rate permissible for any Bank to charge commercial
borrowers under applicable law (the "Maximum Rate"), the rate of interest
------------
charged on any Borrower Loans by any Bank hereunder shall be limited to the
Maximum Rate.
In the event any Bank ever receives, collects or applies as interest
any sum in excess of the Maximum Rate, such excess amount shall be applied to
the reduction of the principal balance of the Borrower Loans in respect of which
such interest was paid or to other amounts (other than interest) payable
hereunder, and if no such principal is then outstanding, such excess or part
thereof remaining shall be paid to the Borrowers.
. Manner and Place of Payment. All payments under this Agreement
---------------------------
or otherwise in respect of any Borrower Loan shall be made not later than 2:00
p.m. (Boston Time) on the date when due and shall be made in immediately
available funds at the Office of the Bank which has made such Borrower Loan or
by a Borrower's check drawn on the depositary account(s) maintained by such
Borrower with such Bank payable to such Bank or its order. All payments shall
be made without setoff, counterclaim, withholding or reduction of any kind
whatsoever. Each Borrower hereby requests and authorizes each Bank to debit any
of such Borrower's accounts with such Bank for payments of interest and
principal due on the Borrower Loans and any other obligations owing by the
Borrowers to such Bank. Each Bank will notify the Borrowers of all debits which
such Bank makes against a Borrower's accounts. Any such debits against a
Borrower's accounts in no way shall be deemed a setoff.
. Payments Due on Saturdays, Sundays and Holidays. Whenever any
-----------------------------------------------
payment to be made hereunder or under the Borrower Notes shall be due on a day
which is not a Banking Day, such payment may be made on the next succeeding
Banking Day, and such extension of time shall be included in computing any
interest or fees due.
. Computations. Interest on the Borrower Loans shall be computed on
------------
the basis of a year of 360 days and actual days elapsed (including the first day
but excluding the last day) occurring in the period for which payable.
. Minimum and Maximum Amounts. Each borrowing, conversion and
---------------------------
prepayment of principal of Borrower Loans shall be in an aggregate principal
amount equal to (a) in the case of LIBOR Loans,$200,000 or a larger multiple of
$50,000 and (b) in the case of Prime Rate Loans, without any minimum amount or
any minimum integral multiple thereof (conversions or prepayments of Borrower
Loans of different Types or, in the case of LIBOR Loans, having different
Interest Periods, at the same time hereunder to be deemed separate conversions
and prepayments for purposes of the foregoing, one for each Type or Interest
Period); provided that any payment or prepayment in full of any Borrower Loans
--------
may be in the aggregate outstanding principal amount thereof.
. Certain Notices. Notices to Fleet regarding the Total Working
---------------
Capital Line Commitment, Working Capital Line of Credit Loans, the Equipment
Line Commitment, Equipment Line of Credit Loans, the 1997 Equipment Line
Commitment and 1997 Equipment Line of Credit Loans of (a) termination of the
Working Capital Line of Credit Commitment, the Equipment Line Commitment or the
1997 Equipment Line Commitment, as the case may be, (b) borrowings of Borrower
Loans, (c) conversions and prepayments of Borrower Loans and of the duration of
Interest Periods, shall be irrevocable and shall be effective only if received
by the Bank in question not later than 12:00 Noon (Boston time) on the number of
Banking Days prior to the date of the termination, borrowing, conversion and/or
prepayment specified below:
Number of
Banking Days
Prior Notice
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Termination of Commitment 2
Borrowings, or prepayment of Prime
Rate Loans 1
Prepayment of, conversion into, or duration of
Interest Periods for, LIBOR Loans 3
Each notice of borrowing, conversion or prepayment shall specify, whether it is
a Working Capital Line of Credit Loan, an Equipment Line of Credit Loan or a
1997 Equipment Line of Credit Loan, the amount, the Type of the Borrower Loan to
be borrowed, converted or prepaid, the date of borrowing, conversion or
prepayment (which shall be a Banking Day in the case of the prepayment of a
Prime Rate Loan, or a Working Day in the case of the conversion or prepayment of
a LIBOR Loan) and, in the case of LIBOR Loans, the duration of the Interest
Period therefor (subject to the definition of Interest Period). Each such
notice of duration of an Interest Period shall specify the Borrower Loans to
which such Interest Period is to relate. In the event that the Borrowers fail
to select the duration of any Interest Period for any LIBOR Loan within the time
period and otherwise as provided in this Section 3.6, such LIBOR Loan will be
automatically converted into a Prime Rate Loan on the last day of the then
current Interest Period for such LIBOR Loan or (if outstanding as Prime Rate
Loans) will remain as, or (if not then outstanding) will be made as Prime Rate
Loans.
. Additional Costs.
----------------
() The Borrowers shall pay to each Bank from time to time such
amounts as such Bank may reasonably determine to be necessary to compensate it
for any costs incurred by such Bank which such Bank determines are attributable
to its making or maintaining of any LIBOR Loans hereunder or its obligation to
make any of such Borrower Loans hereunder, or any reduction in any amount
receivable by such Bank hereunder in respect of any LIBOR Loan or such
obligation (such increases in costs and reductions in amounts receivable being
herein called "Additional Costs"), in each case resulting from any Regulatory
----------------
Change which:
(1) changes the basis of taxation of any amounts payable to such
Bank under this Agreement or the Note or Notes held by such Bank in
respect of any LIBOR Loan; or
(2) imposes or modifies any reserve, special deposit or similar
requirements relating to any extensions of credit or other assets of,
or any deposits with or other liabilities of, such Bank (including any
LIBOR Loan or any deposits referred to in the definition of "LIBOR
Rate" below).
Each Bank will notify the Borrowers of any event occurring after the date of
this Agreement which will entitle such Bank to compensation pursuant to this
Section 3.7 as promptly as practicable after it obtains knowledge thereof and
determines to request such compensation. Such Bank will furnish the Borrowers
with a statement, in reasonable detail, setting forth the basis and amount of
each request by such Bank for compensation under this Section 3.7.
() Without limiting the effect of the foregoing provisions of this
Section 3.7 in the event that, by reason of any Regulatory Change, any Bank
either (i) incurs Additional Costs based on or measured by the excess above a
specified level of the amount of a category of deposits or other liabilities of
such Bank which includes deposits by reference to which the interest rate on
LIBOR Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of such Bank which includes LIBOR Loans or
(ii) becomes subject to restrictions on the amount of such a category of
liabilities or assets which it may hold, then, if such Bank so elects by notice
to the Borrowers, the obligation of such Bank to make LIBOR Loans hereunder
shall be suspended until the date such Regulatory Change ceases to be in effect.
() Determinations and allocations by any Bank for purposes of this
Section 3.7 of the effect of any Regulatory Change on its costs of maintaining
its obligations to make LIBOR Loans or of making or maintaining LIBOR Loans or
on amounts receivable by it in respect of LIBOR Loans, and of the additional
amounts required to compensate such Bank in respect of any Additional Costs,
shall be conclusive absent manifest error, provided that such determinations and
allocations are made on a reasonable basis, and provided further that in
administering this Section each Bank shall not single out the Borrowers for
different treatment but shall deal with them on the same basis as the Bank deals
with its other customers generally.
. Limitation on Types of Loans. Anything herein to the contrary
----------------------------
notwithstanding, if, with respect to any LIBOR Loans, any Bank determines (which
determination shall be conclusive) that the relevant rates of interest referred
to in the definition of "LIBOR Rate" in Section 10.1 below upon the basis of
which the rates of interest for any LIBOR Loan are to be determined do not
accurately reflect the cost to such Bank of making or maintaining such LIBOR
Loans for the Interest Period therefor, then such Bank shall promptly notify the
Borrowers, and so long as such condition remains in effect, such Bank shall be
under no obligation to convert Prime Rate Loans into LIBOR Loans and the
Borrowers shall, on the last day(s) of the then current Interest Period(s) for
the outstanding LIBOR Loans, either prepay such LIBOR Loans or convert such
LIBOR Loans into Prime Rate Loans in accordance with Section 3.13.
. Illegality. Notwithstanding any other provision of this Agreement
----------
to the contrary, in the event that it becomes unlawful for any Bank to (a) honor
its obligation to make LIBOR Loans hereunder, or (b) maintain LIBOR Loans
(identifying the illegality in question in reasonable detail) hereunder, then
such Bank shall promptly notify the Borrowers and the other Bank thereof and
such Bank's obligation to make LIBOR Loans hereunder shall be suspended until
such time as such Bank may again make and maintain LIBOR Loans.
. Substitute Prime Rate Loans. If the obligation of any Bank to
---------------------------
make LIBOR Loans shall be suspended pursuant to Section 3.7, 3.8 or 3.9 hereof,
all Borrower Loans which would otherwise be made by such Bank as LIBOR Loans
shall be made instead as Prime Rate Loans (and, if an event referred to in
Section 3.7(b) or 3.9 has occurred and such Bank so requests, by notice to the
Borrowers, each LIBOR Loan of such Bank then outstanding shall be automatically
converted into a Prime Rate Loan on the date specified by such Bank in such
notice) and, to the extent that LIBOR Loans are so made as (or converted into)
Prime Rate Loans, all payments of principal which would otherwise be applied to
such LIBOR Loans shall be applied instead to such Prime Rate Loans.
. Compensation. If any payment, prepayment or conversion of a LIBOR
------------
Loan occurs on a date other than the last day of an Interest Period for such
Loan other than by reason of an error on the part of either Bank, the Borrowers
shall pay to any Bank, upon the request of such Bank, as compensation
for any loss, cost or expense incurred by such Bank as the result of such
payment, prepayment or conversion, an amount (if a positive number) equal to:
A x (B-C) X D
---
360
where:
"A" equals the principal amount of the LIBOR Loan so paid, prepaid or
converted (the "Affected LIBOR Loan");
-------------------
"B" equals the LIBOR Rate (expressed as a decimal) applicable to the
Affected LIBOR Loan;
"C" equals the applicable LIBOR Rate (expressed as a decimal) in effect on
or about the date of such payment, prepayment or conversion, for deposits
in an amount equal approximately to the principal amount of the Affected
LIBOR Loan with an Interest Period (the "Remaining Interest Period")
-------------------------
beginning on the date of such payment, prepayment or conversion to but
excluding the last day of the existing Interest Period; and
"D" equals the number of days in the Remaining Interest Period;
and any other out-of-pocket loss or expense (including any internal
processing charge customarily charged by such Bank) suffered by such Bank
in liquidating deposits prior to maturity in amounts which correspond to
the principal amount of the Affected LIBOR Loan; provided that such Bank
--------
shall have delivered to the Borrowers a certificate, in reasonable detail,
as to the amount of such loss and expense along with the basis for
calculation thereof.
. Capital Adequacy. If any Bank shall determine that the
----------------
applicability of any law, rule, regulation or guideline adopted pursuant to or
arising out of the July 1988 report of the Basle Committee on Banking
Regulations and Supervisory Practices entitled "International Convergence of
Capital Measurement and Capital Standards", or the adoption after the date
hereof of any other applicable law, rule, regulation or guideline regarding
capital adequacy, or any change in the foregoing or in the enforcement,
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, or compliance by
such Bank or any Person controlling such Bank (a "Parent") with any request or
------
directive regarding capital adequacy (whether or not having the force of law) of
any such Governmental Authority, has or would have the effect of reducing the
rate of return on capital of such Bank or its Parent as a consequence of such
Bank's obligations hereunder to a level below that which such Bank (or its
Parent) could have achieved but for such applicability, adoption, change or
compliance (taking into consideration the policies of such Bank (or its Parent)
with respect to capital adequacy) by an amount reasonably deemed by such Bank to
be material, then from time to time, within the second Business Day after demand
by such Bank, the Borrowers shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such reduction in the rate of return,
together with interest on each such amount from the thirtieth day after such
demand until payment in full thereof (as well after as before judgement) at the
Post-Default Rate. A statement of such Bank, in reasonable detail, claiming
compensation under this Section 3.12 and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive absent manifest error;
provided that the determination thereof is made on a reasonable basis and
--------
provided, further, that the Borrowers shall not be obligated to compensate any
-------- -------
Bank for any such reduction occurring more than 30 days prior to the time the
Bank first notifies the Borrowers of such adoption, implementation, charge or
compliance, and provided further that in administering this Section each Bank
shall not single out the Borrowers for different treatment but shall deal with
them on the same basis as the Bank deals with its other customers generally. In
determining such amount, such Bank may use any reasonable averaging and
attribution methods.
. Optional Prepayments. Subject to the provisions of Section 3.1(e)
--------------------
and this Section 3.13, the Borrowers shall have the right to prepay the Borrower
Loans in whole or in part and to convert Borrower Loans of one Type into another
Type, without premium or penalty, at any time and from time to time, provided
that (i) at the time of the prepayment in full of all Working Capital Extensions
of Credit, Equipment Line of Credit Loans or 1997 Equipment Line of Credit
Loans, as the case may be, the Borrowers shall pay all interest accrued on the
amount prepaid; (ii) the Borrowers shall give the Bank or Banks in question
notice of such prepayment as provided in Section 3.6; (iii) the LIBOR Loans may
be converted into Prime Rate Loans only on the last day of an Interest Period
thereof; and (iv) such Bank or Banks shall be paid, at the time of any
prepayment of a LIBOR Loan that is being prepaid on other than the last day of
an Interest Period therefor, the amount provided for in Section 3.11. Principal
amounts repaid or prepaid under the Borrower Notes or under the Commitment may
be reborrowed by the Borrowers subject to the terms hereof; provided, however,
-------- -------
in the case of the Working Capital Line of Credit Loans, that any funds repaid
or prepaid on or after the earlier to occur of (a) the Working Capital
Commitment Expiration Date or (b) the termination of the Total Working Capital
Line Commitment pursuant to Section 1.7 hereof, may not be reborrowed or
readvanced thereafter, and provided, further, however, in the case of the
-------- ------- -------
Equipment Line of Credit Loans or the 1997 Equipment Line of Credit Loans, that
any funds repaid or prepaid may not be reborrowed or readvanced thereafter.
Section Security and Guaranties.
--------------------------------------
. Security Interests. Each Borrower hereby confirms that it has
------------------
previously granted to SVB as Collateral Agent (as defined in the 1995 Credit
Agreement) for the benefit of the Banks a security interest in, and a lien on,
all right, title and interest of such Borrower in and to certain assets of such
Borrower as set forth in the security agreements, both dated as of September 29,
1995 (the "Original Closing Date"), executed and delivered by Alpha and Trans-
---------------------
Tech, respectively (each a "Security Agreement"), and the pledge agreement,
------------------
dated the Original Closing Date, executed and delivered by Alpha (the "Pledge
------
Agreement"). In order further to secure payment and performance of the
---------
Borrowers' obligations to the Banks under this Agreement, the Borrower Notes and
the other Loan Documents, each Borrower hereby agrees to execute and deliver to
Fleet as Agent an agreement, substantially in the form of Exhibit B hereto (the
---------
"Amendment to Security and Guaranty Agreements"), amending the Security
---------------------------------------------
Agreements and the Pledge Agreement to substitute Fleet as Agent for SVB as
Collateral Agent but otherwise providing that the Security Agreements and the
Pledge Agreement shall remain in full force and effect for the benefit of the
Banks.
. Guaranty. The Borrower Loans have been guaranteed by Alpha
--------
Securities Corp., a Massachusetts corporation, 00 Xxxxxx Xxxx, Xxxxxx, XX 00000
(the "Guarantor"). Alpha hereby agrees to take all necessary or appropriate
---------
action to cause the Guarantor to execute and deliver the Amendment to Security
and Guaranty Agreements to Fleet as Agent for the benefit of the Banks, which
Amendment to Security and Guaranty Agreements shall amend the guaranty and the
security agreement, both dated the Original Closing Date and executed and
delivered by the Guarantor (respectively, the "Guarantee" and the "Guarantor
--------- ---------
Security Agreement"), by substituting Fleet as Agent for SVB as Collateral Agent
------------------
but otherwise providing that the Guarantee and the Guarantor Security Agreement
shall remain in full force and effect for the benefit of the Banks.
Section Conditions Precedent.
-----------------------------------
The Banks shall not be obligated to make any of the Borrower Loans to the
Borrowers hereunder until the following conditions have been satisfied:
. This Agreement, the Borrower Notes and the Security Instruments.
---------------------------------------------------------------
This Agreement, the borrowings hereunder, the Borrower Notes, the Security
Instruments and all transactions contemplated by this Agreement and the Security
Instruments shall have been duly authorized by the Borrowers. The Borrowers
shall have duly executed and delivered to the Banks this Agreement, the
Borrower Notes and the Security Instruments to the Banks in form and substance
satisfactory to the Banks and their counsel. The Guarantor shall have duly
executed and delivered to the Banks its Guaranty.
. No Default. On the Original Closing Date and on the date of
----------
making each Borrower Loan, no Default or Event of Default shall have occurred
and be continuing.
. Correctness of Representations. On the Original Closing Date and
------------------------------
on the date of each Borrower Loan, all representations and warranties made by
the Borrowers in Section 6 below or otherwise in writing in connection herewith
shall be true and correct with the same effect as though such representations
and warranties had been made on and as of today's date, except that
representations and warranties expressly limited to a certain date shall be true
and correct as of that date.
. Opinion of Counsel for the Borrowers. On the Original Closing
------------------------------------
Date, the Banks shall have received the favorable opinion of Brown, Rudnick,
Freed & Gesmer, counsel for the Borrowers and the Guarantors, in form and
substance satisfactory to the Banks and their counsel.
. Governmental Approvals. On the Original Closing Date and on the
----------------------
date of each Borrower Loan, all necessary approvals, licenses, permissions,
registrations or validations of any Governmental Authority required for the
execution, delivery, performance or carrying out of the provisions of this
Agreement, the Borrower Notes and the Security Instruments, or for the validity
or enforceability of the obligations incurred thereunder (other than the filing
of financing statements as required under Section 5.6 below), shall have been
obtained and shall be in full force and effect and copies thereof certified by a
duly authorized officer of a Borrower to such effect shall have been delivered
to the Banks.
. Filing of Financing Statements, etc. On or before the date
-----------------------------------
hereof, financing statements, and other appropriate documentation relating to
the security interests and rights granted pursuant to the Security Instruments,
executed and delivered by the Borrowers and by the Guarantor to Fleet as Agent
for the Banks, shall have been duly recorded or filed in such manner and in such
places as is required by law (including, pursuant to the UCC) to establish,
preserve, protect, and perfect such security interests and rights; and all
taxes, fees and other charges in connection with the execution, delivery and
filing of this Agreement and such financing statements and other appropriate
documentation shall have been duly paid.
. Supporting Documents. On or before the Original Closing Date,
--------------------
there shall have been delivered to the Banks the following supporting documents:
() legal existence and corporate good standing certificates with
respect to each of the Borrowers and the Guarantor dated as of a recent date
issued by the appropriate Secretaries of State or other officials;
() certificates with respect to the due qualification of Alpha and
the Guarantor to do business in Massachusetts dated as of a recent date and
issued by the Secretary of State of such jurisdiction;
() copies of the corporate charter of each of the Borrowers and the
Guarantor, certified by the appropriate Secretaries of State or other officials,
as in effect on the date thereof;
() a certificate of the Secretary or Assistant Secretary of each of
the Borrowers certifying as to () the By-Laws of such Borrower, as in effect on
the date thereof; () the incumbency and signatures of the officers of such
Borrower who have executed any documents in connection with the transactions
contemplated by this Agreement; and () the resolutions of the Board of Directors
and, to the extent required by law, the shareholders, of such Borrower
authorizing the execution, delivery and performance
of this Agreement and the making of any of the Borrower Loans hereunder, and the
execution and delivery of the Borrower Notes;
() a certificate of the Secretary or Assistant Secretary of the
Guarantor certifying as to () the By-Laws of the Guarantor, as in effect on the
date hereof; () the incumbency and signatures of the officers of the Guarantor
who have executed any documents in connection with the transactions contemplated
by this Agreement; and () the resolutions of the Board of Directors and, to the
extent required by law, the shareholders, of the Guarantor authorizing the
execution, delivery and performance of the Guaranty and Guarantor Security
Agreement;
() all other information and documents which the Banks or their
counsel may request in connection with the transactions contemplated by this
Agreement.
. Facility Fees. The Borrowers shall have paid to Fleet a non-
-------------
refundable Facility Fee in the amount of $37,500 in connection with the 1997
Equipment Line Commitment. In respect of the Working Capital Line Commitments,
the Borrowers shall pay to each Bank quarterly in arrears on the last day of
each calendar quarter a Facility Fee equal to one-half percent ( 1/2%) per annum
of such Bank's Working Capital Line Commitment, provided, however, in the event
-------- -------
that the Borrowers request termination of the Total Working Capital Line
Commitment, the payment of the unpaid portion of the Facility Fee for the period
through the Working Capital Commitment Expiration Date shall be accelerated and
shall be immediately payable in full in accordance with Section 1.7.
. Legal Matters. All documents and legal matters incident to the
-------------
transactions contemplated by this Agreement shall be satisfactory to Xxxxxxxx &
Worcester LLP, special counsel for the Banks.
Each borrowing hereunder shall constitute a representation and warranty by
the Borrowers to the Banks that all of the conditions specified in this Section
5 have been complied with as of the time of any such Borrower Loan.
Section Representations and Warranties.
---------------------------------------------
In order to induce the Banks to enter into this Agreement and to make the
contemplated Extensions of Credit, the Borrowers hereby represent and warrant as
follows (except to the extent qualified by supplemental disclosure set forth on
Schedule A hereto) and the following representations and warranties as so
----------
qualified shall survive the execution and delivery of this Agreement and any of
the Borrower Loans:
. Corporate Status. Each of the Borrowers and each of their
----------------
respective Subsidiaries is a duly organized and validly existing corporation in
good standing under the laws of the jurisdiction of its incorporation and is
duly qualified or licensed as a foreign corporation in good standing in each
jurisdiction in which the failure to do so would have a Material Adverse Effect.
. No Violation. Neither the execution, delivery or performance of
------------
this Agreement or any other Loan Document, nor consummation of the contemplated
transactions will contravene any law, statute, rule or regulation to which
either of the Borrowers or any of their Subsidiaries is subject or any judgment,
decree, franchise, order or permit applicable to either of the Borrowers or any
of their Subsidiaries, or will conflict or be inconsistent with or will result
in any breach of, or constitute a default under, or result in or require the
creation or imposition of any Lien (other than the lien created by the Security
Instruments) upon any of the property or assets of either of the Borrowers or
any of their Subsidiaries pursuant to, any Contractual Obligation of the
Borrowers or any of their Subsidiaries, or violate any provision of the
corporate charter or by-laws of either of the Borrowers or any of their
Subsidiaries.
. Corporate Power and Authority. The execution, delivery and
-----------------------------
performance of this Agreement and the other Loan Documents are within the
corporate powers of each of the Borrowers and have been duly authorized by all
necessary corporate action.
. Enforceability. This Agreement and each other Loan Document
--------------
constitutes a valid and binding obligation of each of the Borrowers enforceable
against each Borrower in accordance with its terms, except as be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and subject to general
principles of equity, whether applied in a court of equity or at law.
. Governmental Approvals. No order, permission, consent, approval,
----------------------
license, authorization, registration or validation of, or filing with, or
exemption by, any Governmental Authority is required to authorize, or is
required in connection with, the execution, delivery and performance of this
Agreement or any other Loan Document by the Borrowers, or the taking of any
action contemplated hereby or thereby, except for the filing of UCC-1 financing
statements in the appropriate UCC filing offices listed on the Perfection
Certificate (as defined in the Security Agreement).
. Financial Statements. () The Borrowers have furnished the Banks
--------------------
with complete and correct copies of the audited consolidated balance sheet of
the Borrowers and their Subsidiaries as of the Financial Statements Date, and
the related audited consolidated statements of income and of cash flows for the
fiscal year of the Borrowers and their Subsidiaries ended on such date, examined
by the Accountants. Such financial statements (including the related schedules
and notes) fairly present the consolidated financial condition of the Borrowers
and their Subsidiaries as of the Financial Statements Date, and the consolidated
results of their operations and their consolidated cash flows for the fiscal
year then ended.
() The Borrower has furnished the Banks with complete and correct
copies of the unaudited consolidated balance sheet of the Borrowers and their
Subsidiaries as of June 30, 1997, and the related consolidated statements of
income and of cash flows for the three-month period ended on such date. Such
financial statements (including the related schedules and notes) fairly present
the consolidated financial condition of the Borrowers and their Subsidiaries as
of June 30, 1997, and the consolidated results of their operations and their
consolidated cash flows for the three-month period ended on such date (subject
to normal year-end audit adjustments).
() During the period from the Financial Statements Date to the date
hereof: (i) there has been no sale, transfer or other disposition by the
Borrowers or any of their Subsidiaries of any material part of its business or
property and no purchase or other acquisition of any business or property
(including any capital stock of any Person) material in relation to the
consolidated financial condition of the Borrowers and their Subsidiaries at the
Financial Statements Date; and (ii) neither the Borrowers nor any of their
Subsidiaries has made a Restricted Payment, or agreed or committed to make a
Restricted Payment.
() All the above-referenced financial statements (including the
related schedules and notes) have been prepared in accordance with GAAP applied
consistently throughout the periods involved (except as approved by the
Accountants and disclosed therein and, in the case of interim financial
statements, subject to normal year-end adjustments and the absence of footnotes
and schedules). Neither Borrower nor any of their respective Subsidiaries has
any material liabilities, contingent or otherwise, including liabilities for
taxes or any unusual forward or long-term commitments or any Guarantee, which
are not disclosed by or included in the above-referenced financial statements or
the accompanying notes and there are no unrealized or anticipated losses from
any unfavorable commitments of the Borrowers or any of their Subsidiaries which
may have a Material Adverse Effect.
. No Material Change. Since the Financial Statements Date there
------------------
has been no development or event, nor to the best knowledge of the Borrowers,
any prospective development or event, which has had or could have a Material
Adverse Effect.
. Litigation. There are no actions, suits or proceedings pending
----------
or threatened against or affecting either of the Borrowers or any of their
Subsidiaries before any Governmental Authority, which in any one case or in the
aggregate, if determined adversely to the interests of either Borrower or any
Subsidiary thereof, would have a Material Adverse Effect.
. Compliance with Other Instruments; Compliance with Law. Neither
------------------------------------------------------
Borrower nor any Subsidiary thereof is in default under any Contractual
Obligation, where such default could have a Material Adverse Effect. Neither
Borrower nor any Subsidiary thereof is in default and or in violation of any
applicable statute, rule, writ, injunction, decree, order or regulation of any
Governmental Authority having jurisdiction over the Borrower or any Subsidiary
thereof which default or violation could have a Material Adverse Effect,
provided that nothing herein shall prevent the Borrower from contesting in good
faith any alleged default or violation by appropriate proceedings diligently
conducted where adequate reserves have been established in accordance with GAAP.
. Subsidiaries. The Borrowers have no Subsidiaries except as set
------------
forth on attached Schedule A.
----------
. Investment Borrower Status; Limits on Ability to Incur
------------------------------------------------------
Indebtedness. Neither Borrower nor any of their Subsidiaries is an "investment
------------
company" or a company "controlled by" an investment company within the meaning
of the Investment Company Act of 1940, as amended. Neither Borrower is subject
to regulation under any Federal or State statute or regulation which limits its
ability to incur Indebtedness.
. Title to Property. Each of the Borrowers and each of their
-----------------
Subsidiaries has good and marketable title to all of its properties and assets,
including the properties and assets reflected in the consolidated balance sheet
of the Borrowers and their Subsidiaries as of the Financial Statements Date,
except as disclosed on Schedule A and except such as have been disposed of since
----------
that date in the ordinary course of business, and none of such properties or
assets is subject to any Lien except for () Permitted Liens, or () a defect in
title or other claim other than defects and claims that, in the aggregate, would
have no Material Adverse Effect. Each of the Borrowers and each of their
Subsidiaries enjoys peaceful and undisturbed possession under all leases
necessary in any material respect for the operation of its properties and
assets, none of which contains any unusual or burdensome provisions which might
materially affect or impair such properties or assets. All such leases are
valid and subsisting and are in full force and effect.
. ERISA. Each of the Borrowers and each member of the Controlled
-----
Group have fulfilled their obligations under the minimum funding standards of
ERISA and the Code with respect to each Plan and are in compliance in all
material respects with the presently applicable provisions of ERISA and the
Code, and have not incurred any liability to the PBGC or a Plan under Title IV
of ERISA (other than to make contributions or premium payments in the ordinary
course).
. Taxes. All tax returns of the Borrowers and their Subsidiaries
-----
required to be filed have been timely filed, all taxes, fees and other
governmental charges (other than those being contested in good faith by
appropriate proceedings diligently conducted and with respect to which
adequate reserves have been established) and, in the case of ad valorem taxes or
-- -------
betterment assessments, no proceedings to foreclose any lien with respect
thereto have been commenced and, in all other cases, no notice of lien has been
filed or other action taken to perfect or enforce such lien) shown thereon which
are payable have been paid. The charges and reserves on the books of the
Borrower and their Subsidiaries for all income and other taxes are adequate, and
the Borrower knows of no additional assessment or any basis therefor. The
Federal income tax returns of the Borrowers and their Subsidiaries have not been
audited within the
last three years, all prior audits have been closed, and there are no unpaid
assessments, penalties or other charges arising from such prior audits.
. Environmental Matters. () Each of the Borrowers and each of
---------------------
their Subsidiaries have obtained all Governmental Approvals that are required
for the operation of its business under any Environmental Law, except where the
failure to so obtain a Governmental Approval would not have a Material Adverse
Effect.
() Each of the Borrowers and each of their Subsidiaries are in
compliance with all terms and conditions of all required Governmental Approvals
and are also in compliance with all terms and conditions of all applicable
Environmental Laws, noncompliance with which would have a Material Adverse
Effect.
() Except as disclosed in Schedule A, there is no civil, criminal or
----------
administrative action, suit, demand, claim, hearing, notice of violation,
investigation, proceeding, notice or demand letter pending or, to the best
knowledge of the Borrowers threatened against the Borrowers or any Subsidiary
thereof relating in any way to the Environmental Laws, and there is no Lien of
any private entity or Governmental Authority against any property of the
Borrowers or any Subsidiary thereof relating in any way to the Environmental
Laws.
() There has been no claim, complaint, notice, or request for
information received by the Borrowers with respect to any site listed on the
National Priority List promulgated pursuant to the Comprehensive Environmental
Response, Compensation, and Liability Act ("CERCLA"), 42 USC (S) 9601 et seq.,
------ -- ----
or any state list of sites requiring investigation or cleanup with respect to
contamination by Hazardous Substances.
() To the best of the Borrowers' knowledge, there has been no release
or threat of release of any Hazardous Substance at any Borrower Property which
would likely result in liability being imposed upon either of the Borrowers or
any Subsidiary thereof, which liability would have a Material Adverse Effect.
. Intellectual Property. Each of the Borrowers and each of their
---------------------
Subsidiaries owns or possesses such Intellectual Property and similar rights
necessary for the conduct of its business as now conducted, without any known
conflict with the rights of others which would have a Material Adverse Effect.
. Working Capital Borrowing Base. Giving effect to any Working
------------------------------
Capital Extensions of Credit outstanding or to be made as of the date hereof
under this Agreement, the aggregate amount of all Working Capital Extensions of
Credit under this Agreement does not exceed the Working Capital Borrowing Base
on the date hereof.
Section Affirmative Covenants.
------------------------------------
The Borrowers covenant and agree that for so long as this Agreement is in
effect and until the Borrower Notes, together with all interest thereon and all
other Obligations of the Borrowers to the Banks are paid or satisfied in full:
. Maintenance of Existence. Except as disclosed on Schedule A,
------------------------ ----------
each of the Borrowers will, and will cause each of their Subsidiaries to,
maintain its existence and comply with all applicable statutes, rules and
regulations and to remain duly qualified as a foreign corporation, licensed and
in good standing in each jurisdiction where such qualification or licensing is
required by the nature of its business, the character and location of its
property, business, or the ownership or leasing of its property, except where
such noncompliance or failure to so qualify would not have a Material Adverse
Effect, and the Borrowers will, and will cause each of their Subsidiaries to,
maintain its properties in good
operating condition, and continue to engage in the same business as presently
conducted or businesses reasonably related or complementary thereto.
. Taxes and Other Liens. Each of the Borrowers will, and will
---------------------
cause each of their Subsidiaries to, pay when due all taxes, assessments,
governmental charges or levies, or claims for labor, supplies, rent and other
obligations made against it which, if unpaid, might become a Lien against either
Borrower or such Subsidiary or on its property, except liabilities being
contested in good faith and by proper proceedings, as to which adequate reserves
are maintained on the books of the Borrowers or their Subsidiaries, in
accordance with GAAP.
. Insurance. Each of the Borrowers will, and will cause each of
---------
their Subsidiaries to, maintain insurance with financially sound and reputable
insurance companies in such amounts and against such risks as is usually carried
by owners of similar businesses and properties in the same general areas in
which the Borrowers and their Subsidiaries operate, provided that in any event
the Borrowers and their Subsidiaries shall maintain or cause to be maintained
(a) insurance against casualty, loss or damage covering all property and
improvements of the Borrowers and their Subsidiaries in amounts and in respect
of perils usually carried by owners of similar businesses and properties in the
same general areas in which the Borrowers and their Subsidiaries operate; (b)
comprehensive general liability insurance against claims for bodily injury,
death or property damage; and (c) workers' compensation insurance to the extent
required by applicable law. In the case of policies referenced in clauses (a)
and (b) above, all such insurance shall (i) name the Borrowers and the Banks as
loss payees and additional insureds as their interests may appear; (ii) provide
that no termination, cancellation or material reduction in the amount or
material modification to the extent of coverage shall be effective until at
least 30 days after receipt by the Banks of notice thereof; and (iii) be
reasonably satisfactory in all other respects to the Banks, provided that as
long as no Event of Default has occurred or is continuing and no casualty could
reasonably be expected to have a Material Adverse Effect, the Borrowers shall
have the right to use any insurance proceeds to repair or replace damaged or
lost equipment or property.
. Financial Statements, Etc. The Borrowers will furnish to the
-------------------------
Banks:
() within forty-five (45) days after the end of each fiscal quarter
of the Borrowers, the unaudited consolidated and consolidating balance sheet and
income statement and statement of cash flows of the Borrowers, together with
their Subsidiaries as at and for the three-month period ended on the last day of
such fiscal quarter, accompanied by a certificate of the chief financial officer
of Alpha to the effect that such financial statements fairly present the
consolidated financial condition of the Borrowers and their Subsidiaries as of
the end of such fiscal quarter, and the consolidated results of their operations
and their consolidated cash flows for such fiscal quarter, in each case in
accordance with GAAP (except for the absence of footnotes) consistently applied
(subject to normal year-end audit adjustments);
() within ninety (90) days after the last day of each fiscal year of
the Borrowers, the audited consolidated balance sheet and income statement and
statement of cash flows of the Borrowers and their Subsidiaries as at and for
the fiscal year then ended, certified by the Accountants (the substance of such
report to be satisfactory to the Banks), together with a certificate of the
chief financial officer of Alpha to the effect that such financial statements
fairly present the consolidated financial condition of the Borrowers and their
Subsidiaries as of the end of such fiscal year, and the consolidated results of
their operations for such fiscal year, in each case in accordance with GAAP. The
Borrowers shall indicate on said financial statements all guarantees or unusual
forward or long-term commitments made by the Borrowers or any Subsidiary
thereof;
() at the time of the delivery of the quarterly and yearly financial
statements required by Sections 7.4(a) and (b) above, a Compliance Certificate
signed by the chief financial officer or the president of Alpha in the form
attached to this Agreement as Exhibit C, appropriately completed;
---------
() within thirty (30) days after the end of each fiscal month of the
Borrowers during which the aggregate principal amount of Borrower Loans then
outstanding is at least $2,000,000, (i) a list of the trade accounts receivable
aging for each of the Borrowers as of the end of such month in such form as the
Banks may prescribe, all in reasonable detail and (ii) a Borrowing Base
Certificate signed by the chief financial officer or the president of each of
the Borrowers in the form attached to this Agreement as Exhibit D appropriately
---------
completed;
() promptly upon the mailing thereof to the shareholders of the
Borrowers generally, copies of all financial statements, reports, proxy
statements and other materials;
() promptly upon request by any Bank, copies of any management letter
provided by the Accountants;
() promptly upon the filing thereof by a Borrower with the SEC (and
in any event within five (5) days of such filing), copies of any registration
statements and reports on Forms 10-K, 10-Q and 8-K (or their equivalents if such
forms no longer exist);
() promptly upon becoming aware of any litigation or other proceeding
against any Borrower or any Subsidiary thereof that may have a Material Adverse
Effect, notice thereof; and
() promptly following the request of any Bank, such further
information concerning the business, affairs and financial condition or
operations of the Borrower and their Subsidiaries as such Bank may reasonably
request.
. Notice of Default. As soon as practicable, and in any event,
-----------------
within five (5) Banking Days of becoming aware of the existence of any condition
or event which constitutes a Default, the Borrowers will provide each Bank with
written notice specifying the nature and period of existence thereof and what
action the Borrowers is taking or proposes to take with respect thereto.
. Environmental Matters.
---------------------
() Each of the Borrowers and each of their Subsidiaries shall comply
with all terms and conditions of all applicable Governmental Approvals and all
applicable Environmental Laws, except where failure to comply could reasonably
be anticipated not to have a Material Adverse Effect.
() The Borrowers shall promptly notify the Banks in the event that
any executive officer of either Borrower or any employee of the Borrowers
primarily responsible for compliance with Environmental Laws becomes aware of:
() any spill, release, or threat of release of any Hazardous
Substance at or from any Borrower Property or by any Person for whose
conduct either Borrowers or any Subsidiary thereof is responsible, to the
extent such Borrowers is required by Environmental Laws to report such to
any Governmental Authority;
() any action or notice with respect to a civil, criminal or
administrative action, suit, demand, claim, hearing, notice of violation,
investigation, proceeding, notice or demand letter pending or threatened
against either Borrower or any Subsidiary thereof relating in any way to
the Environmental Laws, or any Lien of any Governmental Authority or any
other Person against any Borrower Property relating in any way to the
Environmental Laws;
() any claim made or threatened by any Person against either Borrower
or any Subsidiary thereof or any property of either Borrower or any
Subsidiary thereof relating to damage, contribution, cost recovery
compensation, loss or injury resulting from any Hazardous Substance
pertaining to such property or the business or operations of either
Borrower or such Subsidiary; and
() any occurrence or condition on any real property adjoining or in
the vicinity of any Borrower Property known to the officers or supervisory
personnel of either Borrower or any Subsidiary thereof or other employees
having responsibility for the compliance by either Borrower or any
Subsidiary thereof with Environmental Laws, without any independent
investigation, which does cause, or could cause, such Borrower Property, or
any part thereof, to contain Hazardous Substances in violation of any
Environmental Laws, or which does cause, or could cause, such Borrower
Property to be subject to any restrictions on the ownership, occupancy,
transferability or use thereof by either Borrower or any Subsidiary
thereof.
() Each Borrower will, and will cause each of their Subsidiaries to,
at its own cost and expense, and within such period as may be required by
applicable law or regulation, initiate all remedial actions and thereafter
diligently prosecute such action as shall be required by law for the cleanup of
such Borrower Property, including all removal, containment and remedial actions
in accordance with all applicable Environmental Laws and shall further pay or
cause to be paid, at no expense to the Banks, all cleanup, administrative, and
enforcement costs of applicable Government Authorities which may be asserted
against such Borrower Property.
. ERISA Information. If and when either Borrower or any member of
-----------------
the Controlled Group () gives or is required to give notice to the PBGC of any
"reportable event" (as defined in Section 4043 of ERISA) with respect to any
Plan which might constitute grounds for a termination of such Plan under Title
IV of ERISA, or knows that the plan administrator of any Plan has given or is
required to give notice of any such reportable event, () receives notice of
complete or partial withdrawal liability under Title IV of ERISA or () receives
notice from the PBGC under Title IV of ERISA of an intent to terminate or
appoint a trustee to administer the Plan, the Borrowers shall in each such
instance promptly furnish to the Banks a copy of any such notice.
. Inspection. Each Borrower will, upon the request of the Banks,
----------
permit a representative of the Banks (including any field examiner or auditor
retained by the Banks) to inspect and make copies of the Borrowers' books and
records, and to discuss its affairs, finances and accounts with its officers and
accountants, at such reasonable times and as often as the Banks may reasonably
request and cause each of their Subsidiaries to do so. Each Borrower agrees
that an accounts receivable audit shall be conducted on an annual basis
thereafter by a Bank designated by the Agent. Each Bank will maintain the
confidentiality of any non-public information relating to the Borrowers and
their Subsidiaries which has been identified in writing as confidential on the
information itself or otherwise (the "Confidential Information") and, except as
provided below, will exercise the same degree of care that such Bank exercises
with respect to its own proprietary information to prevent the unauthorized
disclosure of the Confidential Information to third parties. Confidential
Information shall not include data or information that either: (a) is in or
becomes part of the public domain or is already in the knowledge or possession
of such Bank when disclosed to such Bank, without breach of this Agreement; or
(b) is disclosed to such Bank by a third party, provided such Bank does not have
actual knowledge that such third party is prohibited from disclosing such
information. The terms of this Section shall not apply to disclosure of
Confidential Information by either Bank that is, in the good faith opinion of
such Bank, compelled by laws, regulations, rules, orders or legal process or
proceedings or is disclosed to: (a) any party, including a prospective
participant, who has signed a confidentiality agreement containing terms
substantially similar to those contained herein; and (b) examiners, auditors and
investigators having regulatory authority over such Bank.
. Use of Proceeds. The Borrowers shall use the proceeds of the
---------------
borrowings under the Working Capital Note for the working capital purposes of
the Borrowers, which purposes shall not include payment of any amounts owed
under the Equipment Line Note or the 1997 Equipment Line Note. The Borrowers
shall use the proceeds of the borrowings under the Equipment Line Note and the
1997
Equipment Line Note exclusively for financing the acquisition of Eligible
Equipment. Without limiting the foregoing, no part of such proceeds will be used
for the purpose of purchasing or carrying any "margin security" as such term is
defined in Regulation U of the Board of Governors of the Federal Reserve System.
. Further Assurances. Each Borrower will, and will cause each of
------------------
their Subsidiaries to, execute and deliver to the Banks any writings and do all
things necessary, effectual or reasonably requested by the Banks to carry into
effect the provisions and intent of this Agreement or any other Loan Document.
. Subsidiaries. Each Borrower shall immediately notify each Bank
------------
of the organization of any additional foreign or domestic Subsidiaries of the
Borrowers. The Banks may require that any Subsidiaries become parties to any of
the Loan Documents as guarantors or sureties and/or that the Borrowers pledge
the stock of any Subsidiaries as collateral for the Obligations of the
Borrowers.
. Intellectual Property. The Borrowers will promptly inform the
---------------------
Banks of all applications filed by the Borrowers for trademarks, patents and
copyrights and of all trademarks, patents and copyrights granted on or after the
date of this Agreement.
Section Negative Covenants.
---------------------------------
Each of the Borrowers covenants and agrees that for so long as this
Agreement is in effect and until the Borrower Notes, together with all interest
thereon and all other Obligations of the Borrower to the Banks are paid or
satisfied in full, without the prior written consent of all the Banks:
. ERISA. The Borrowers will not permit any pension plan maintained
-----
by either Borrower or by any member of a "Controlled Group" (ERISA (S)210(c) or
ERISA (S)210(d)) of which either Borrower is a member to: () engage in any
"prohibited transaction" (ERISA (S)2003(c)); () fail to report to the Banks a
"reportable event" (ERISA (S)4043) within 30 days after its occurrence or as to
any reportable event as to which the 30-day notice period requirement of Section
4043(b) of Title IV of ERISA has been waived by the PBGC, within 30 days of such
time as the Borrower is requested to notify the PBGC of such reportable event;
() incur any "accumulated funding deficiency" (ERISA (S)302); () terminate its
existence at any time in a manner which could result in the imposition of a Lien
on the property of the Borrower or any Subsidiary thereof; or () fail to report
to the Banks any "complete withdrawal" or "partial withdrawal" by the Borrower
or an affiliate from a "multiemployer plan" (ERISA (S)(S)4203, 4205, and 4001,
respectively). The quoted terms are defined in the respective sections of ERISA
cited above.
. Transactions with Affiliates. Subject to the provisions of
----------------------------
Section 8.8, neither Borrower will and nor permit any of their Subsidiaries to,
directly or indirectly, pay any funds to or for the account of, make any
Investment in, lease, sell, transfer or otherwise dispose of any assets,
tangible or intangible, or engage in any transaction in connection with any
joint enterprise or other joint arrangement with, any Affiliate of the
Borrowers, unless such transaction is otherwise permitted under this Agreement,
is in the ordinary course of the Borrowers' or such Subsidiary's business, and
is (a) in the case of any transaction, between any Borrower and its Subsidiaries
or between the Subsidiaries, is duly accounted for in accordance with GAAP, and
(b) in the case of transactions with other Affiliates, is upon fair and
reasonable terms no less favorable to such Borrower or such Subsidiary as those
that could be obtained in a comparable arm's length transaction with a Person
which is not an Affiliate but is a significant and valued customer.
. Consolidation, Merger or Acquisition. Neither Borrower will, nor
------------------------------------
permit any of their Subsidiaries to, merge or consolidate with or into any other
Person, or make any acquisition of the business of any other Person unless it
obtains the prior written consent of the Banks; provided that any Subsidiary may
--------
merge into a Borrower or any wholly-owned Subsidiary of a Borrower, and
provided, further that either Borrower and their Subsidiaries may make an
-------- -------
acquisition or effectuate a merger with
another Person as long as (a) no Event of Default has arisen during the four
fiscal quarters immediately preceding any such transaction; (b) no Event of
Default would arise as a result of such transaction or is otherwise reasonably
expected to occur during the four fiscal quarters immediately following such
transaction and the Borrowers furnishes to the Banks in advance of such
transaction pro forma financial information reasonably demonstrating the
--- -----
foregoing; (c) the other Person is engaged in the same or a related line of
business; (d) there is no change in the senior management of the Borrowers; (e)
in the case of any merger, the Borrower or its Subsidiary is the surviving
entity; and (f) the aggregate value of cash consideration paid by the Borrowers
and their Subsidiaries in connection with such transactions in any fiscal year
does not exceed (i) in the event that the Borrower's Tangible Net Worth is less
than $40,000,000 immediately preceding such a transaction, $7,500,000; and (ii)
in the event that the Borrower's Tangible Net Worth immediately preceding such a
transaction is $40,000,000 or greater, $15,000,000.
. Disposition of Assets. Neither Borrower will nor permit any of
---------------------
their Subsidiaries to, convey, sell, lease, transfer or otherwise dispose of any
of its property, business or assets (including, without limitation, accounts
receivable and leasehold assets), whether now owned or hereafter acquired,
except:
() excess, obsolete or worn out property disposed of in the ordinary
course of business;
() the sale or other disposition of any property in the ordinary
course of business, provided that the aggregate book value of all assets
--------
(other than inventory) so sold or disposed of in any period of twelve
consecutive months shall not exceed 5% of the consolidated total assets of
the Borrowers and their Subsidiaries as at the beginning of such twelve-
month period; and
() the sale of inventory in the ordinary course of business.
. Indebtedness. The Borrowers will not, and will not permit any of
------------
their Subsidiaries to, create, incur, assume or suffer to exist any
Indebtedness, except:
() Indebtedness payable to the Banks in connection with this Amended
and Restated Credit Agreement;
() existing Indebtedness, including Subordinated Debt, if any, listed
on Schedule A hereto;
----------
() Subordinated Debt incurred by either Borrower after the date
hereof; provided that, giving effect to the incurrence of such Subordinated
--------
Debt and to the receipt and application of the proceeds thereof, no Default
shall have occurred and be continuing; and
() Purchase Money Indebtedness and Capital Lease Obligations in an
aggregate amount not in excess of $10,000,000 in any fiscal year.
. Liens. The Borrowers will not, and will not permit any of their
-----
Subsidiaries to, create, incur, assume or suffer to exist any Lien on any of its
properties or assets, except the following (collectively, "Permitted Liens"):
---------------
() Liens for taxes not delinquent or being contested in good faith
and by proper proceedings, as to which adequate reserves are maintained on
the books of the Borrowers or their Subsidiaries in accordance with GAAP;
() carriers', warehousemen's, mechanics', materialmen's or similar
liens imposed by law incurred in the ordinary course of business in respect
of obligations not overdue, or being contested in good faith and by proper
proceedings and as to which adequate reserves with
respect thereto are maintained on the books of the Borrowers and their
Subsidiaries in accordance with GAAP;
() pledges or deposits in connection with workers' compensation,
unemployment insurance and other types of social security legislation;
() security deposits made to secure the performance of leases,
licenses and statutory obligations incurred in the ordinary course of
business;
() Liens in favor of Fleet as Agent for the Banks under the Loan
Documents;
() existing Liens, if any, listed on Schedule A hereto; provided that
---------- --------
no such Lien is spread to cover any additional property after the date
hereof, and that the amount of the Indebtedness secured thereby is not
increased;
() Purchase Money Security Interests securing Purchase Money
Indebtedness permitted under Section 8.5(d) above;
() Liens with respect to Indebtedness secured by real property having
a fair market value in excess of the Indebtedness so secured;
() Liens securing Indebtedness under Capital Lease Obligations
permitted under Section 8.5(d); and
() Encumbrances on real property, such as easements, rights of way,
and zoning restrictions, which do not, individually or in the aggregate,
materially interfere with the use of the property in the conduct of the
Borrower's or a Subsidiary business.
. Restricted Payments. The Borrowers will not, and will not permit
-------------------
any of their Subsidiaries to, declare or make any Restricted Payment, provided
that provided, however, Alpha may make cash expenditures in an aggregate amount
of up to $100,000 in any fiscal year in order to redeem shares of capital stock
of Alpha under the Borrower's employee benefits plans.
. Investments. The Borrowers will not, and will not permit any of
-----------
their Subsidiaries to, make, maintain or acquire any Investment in any Person
other than:
() marketable obligations issued or guaranteed by the United States
of America;
() certificates of deposit, Eurodollar time deposits, commercial
paper or any other obligations of (i) a Bank, (ii) any other bank or trust
company organized or licensed to conduct a banking business under the laws
of the United States or any State thereof and which has (or which is a
Subsidiary of a bank holding company which has) publicly traded debt
securities rated A or higher by Standard & Poor's Corporation or A-2 or
higher by Xxxxx'x Investors Service, Inc. or (iii) the banking institutions
listed on Schedule A hereto;
----------
() depositary accounts at the Banks or any banking institution
meeting the requirements of subparagraph 8.8(b) above;
() stock or obligations issued to the Borrowers or any Subsidiary
thereof in settlement of claims against others by reason of an event of
bankruptcy or a composition or the readjustment of debt or a reorganization
of any debtor of the Borrowers or such Subsidiary;
() commercial paper having the highest rating then given by Xxxxx'x
Investors Services, Inc. or Standard & Poor's Corporation;
() repurchase obligations with a term of not more than seven days for
underlying securities of the types described in subparagraph 8.8(a) above
entered into with the Banks or any of the banks referred to in subparagraph
8.8(b) above;
() investments in publicly reported shares of so-called "money
market" mutual funds investing in securities of the type listed above in
subparagraphs (a), (b), (e) and (f);
() Investments by either Borrower in the Guarantor and Investments by
the Guarantor in the Borrower;
() Investments by the Borrowers in their Subsidiaries other than the
Guarantor; provided that the sum of (A) the aggregate amount of all
--------
Investments made after September 29, 1995 by the Borrowers in their Non-
Guarantor Subsidiaries and (B) the outstanding amount of any Indebtedness
of any Non-Guarantor Subsidiary of the Borrowers that is Guaranteed
pursuant to this subparagraph (i), may not exceed $500,000 at any time,
provided, however, nothing in this Section 8.8 shall prohibit Investments
by the non-Guarantor Subsidiaries in the Borrowers;
() existing joint ventures, partnerships or strategic alliances
listed on Schedule A and joint ventures, partnerships or strategic
----------
alliances formed hereafter and approved in writing in advance by the Banks;
() securities of a corporation or limited liability company engaged
in a line of business complimentary to that of the Borrowers but not
constituting a Subsidiary, provided such Investment is approved in advance
in writing by the Banks, except for nominal holdings of the securities of
competitors; and
() authorized loans to employees, sales representatives and vendors
of the Borrowers and their Subsidiaries provided that the aggregate
principal amount of such loans may not exceed $500,000 at any time.
. Sale and Leaseback. Neither Borrower nor any of their
------------------
Subsidiaries shall enter into any arrangement, directly or indirectly, whereby
it shall sell or transfer any property owned by it in order to lease such
property or lease other property that such Borrowers or any such Subsidiary
intends to use for substantially the same purpose as the property being sold or
transferred.
. Additional Stock Issuance by Subsidiaries. The Borrowers shall
-----------------------------------------
not permit any of their Subsidiaries to issue any additional shares of its
capital stock or other equity securities, any options therefor or any securities
convertible thereto other than to the Borrowers.
. Quick Ratio. The Borrowers will not permit the Quick Ratio at the
-----------
end of any quarter to be less than 1.20 to 1.
. Minimum Profitability. The Borrowers shall not (a) permit Net
---------------------
Income to be less than $1.00 for each of the fiscal quarters ending September
30, 1997 and December 31, 1997, (b) permit Net Income to be less than $500,000
for any fiscal quarter ending March 31, 1998 or thereafter, (c) permit
cumulative Net Income to be less than $2,000,000 at March 31, 1998 for the
twelve-month period then ended or (d) permit cumulative Net Income to be less
than $3,000,000 at June 30, 1998 (or any fiscal quarter end thereafter) for the
twelve-month period then ended.
. Leverage. The Borrowers will not permit the ratio of Total
--------
Senior Liabilities to Tangible Net Worth to be greater than (a) 1.0 to 1 at the
end of the fiscal quarters ending December 31, 1997, March 31, 1998 and June 30,
1998 or (b) 0.75 to 1 at the end of any fiscal quarter ending September 30, 1998
or thereafter.
. Capital Expenditures. Neither the Borrowers nor any of their
--------------------
Subsidiaries shall purchase or agree to purchase, or incur any obligations
(including that portion of the obligations arising under capital leases that is
required to be capitalized on the consolidated balance sheet of the Borrowers
and their Subsidiaries) for any equipment or other property constituting fixed
assets in any fiscal year in excess of $15,000,000.
8.15 Exception for Building. Notwithstanding Sections 8.4, 8.5, 8.6
----------------------
and 8.9 hereof, the Borrowers shall be permitted (a) to refinance the building
located at 00 Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx (the "Building") in an amount
--------
not to exceed $10,000,000 and (b) to effect a sale-leaseback of the Building for
a sale price of between $12,000,000 and $14,000,000.
Section Events of Default.
--------------------------------
. Events of Default. The occurrence of any of the following events
-----------------
shall be an "Event of Default" hereunder:
() The Borrowers (i) shall default in the due and punctual payment of
principal or interest on any Borrower Note, or (ii) shall fail to make
payment of any other amount due under any Loan Document within four (4)
days of the date on which such amount is due or on which demand is made
therefor; or
() Any representation, warranty or statement made herein or any other
Loan Document, or in any certificate or statement furnished pursuant to or
in connection herewith or therewith, shall prove to be incorrect,
misleading or incomplete in any material respect on the date as of which
made or deemed made; or
() The Borrowers shall default in the performance or observance of
any term, covenant or agreement on their part to be performed or observed
pursuant to Sections 8.3 and 8.11 through 8.16; or
() The Borrowers shall default in the performance or observance of
any term, covenant or agreement on their part to be performed or observed
pursuant to any of the provisions of this Agreement or any other Loan
Document (other than those referred to in paragraphs 9.1(a) through 9.1(c)
above) and such default shall continue unremedied for a period of ten (10)
days after the occurrence of such default; or
() Any obligation of the Borrowers or any Subsidiary thereof in an
amount in excess of $250,000 in respect of any Indebtedness (other than the
Borrowers Notes) or any Guarantee shall be declared to be or shall become
due and payable prior to the stated maturity thereof, or such Indebtedness
or Guarantee shall not be paid as and when the same becomes due and
payable, or there shall occur and be continuing any default under any
instrument, agreement or evidence of indebtedness relating to any such
Indebtedness the effect of which is to permit the holder or holders of such
instrument, agreement or evidence of indebtedness, or a trustee, agent or
other representative on behalf of such holder or holders, to cause such
Indebtedness to become due prior to its stated maturity; or
() The Borrowers or a Subsidiary thereof shall () apply for or
consent to the appointment of, or the taking of possession by, a receiver,
custodian, trustee or liquidator of itself or of all or a substantial part
of its property, () make a general assignment for the benefit of its
creditors, () commence a voluntary case under the Bankruptcy Code, () file
a petition seeking to take advantage of any other law relating to
bankruptcy, insolvency, reorganization, winding-up, or composition or
readjustment of debts, () fail to controvert in a timely and appropriate
manner, or
acquiesce in writing to, any petition filed against it in an involuntary
case under the Bankruptcy Code, or () take any corporate action for the
purpose of effecting any of the foregoing; or
() A proceeding or case shall be commenced, without the application
or consent of the Borrowers or any Subsidiary thereof in any court of
competent jurisdiction, seeking () its liquidation, reorganization,
dissolution or winding-up of either Borrower or any Subsidiary, or the
composition or readjustment of its debts, () the appointment of a trustee,
receiver, custodian, liquidator or the like of either Borrower or any
Subsidiary or of all or any substantial part of its assets, or () similar
relief in respect of either Borrower or any Subsidiary under any law
relating to bankruptcy, insolvency, reorganization, winding-up, or
composition or adjustment of debts, and such proceeding or case shall
continue undismissed, or an order, judgment or decree approving or ordering
any of the foregoing shall be entered and continue unstayed and in effect,
for a period of 60 days; or an order for relief against either Borrower or
any Subsidiary shall be entered in an involuntary case under the Bankruptcy
Code; or
() A judgment or judgments for the payment of money in excess of
$250,000 (net of insurance proceeds) in the aggregate shall be rendered
against either Borrower or any Subsidiary thereof and any such judgment or
judgments shall not have been vacated, discharged, stayed or bonded pending
appeal within thirty (30) days from the entry thereof; or
() Either Borrower or any member of the Controlled Group shall fail
to pay when due an amount or amounts aggregating in excess of $100,000
which it is obligated to pay to the PBGC or to a Plan under Title IV of
ERISA; or a notice of intent to terminate a Plan or Plans having aggregate
Unfunded Liabilities in excess of $100,000 shall be filed under Title IV of
ERISA by either Borrower or any member of the Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate or to cause a
trustee to be appointed to administer any such Plan or Plans or a
proceeding shall be instituted by a fiduciary of any such Plan or Plans
against either Borrower or any member of the Controlled Group to enforce
Sections 515 or 4219(c)(5) of ERISA; or a condition shall exist by reason
of which the PBGC would be entitled to obtain a decree adjudicating that
any such Plan or Plans must be terminated; or there shall occur a complete
or partial withdrawal form, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause either Borrower or one or more members of the Controlled Group
to incur a current payment obligation in excess of $100,000; or
() Either Borrower or any Subsidiary thereof shall default in the
performance or observance of any term, covenant or agreement on its part to
be performed or observed pursuant to any of the provisions of any agreement
with the Banks or any instrument delivered in favor of any Bank (other
than, in either case, a Loan Document), and such default shall continue
unremedied beyond the grace period (if any) provided for therein; or
() Any Security Instrument shall cease for any reason to be in full
force and effect or shall cease to be effective to grant a perfected
security interest in the collateral described in such Security Instrument
with the priority stated to be granted thereby; or
() Either Borrower shall make any payment on account of its
Subordinated Debt, except to the extent such payment is expressly permitted
hereby or under any subordination agreement entered into with the Banks.
. Remedies Upon an Event of Default. Upon the occurrence of an
---------------------------------
Event of Default described in Sections 9.1(f) and 9.1(g), immediately and
automatically, and upon the occurrence of any other Event of Default, at any
time thereafter while such Event of Default is continuing, at the option of the
Agent and upon the Agent's declaration:
(i) the Commitments of each Bank shall be terminated;
(ii) the unpaid principal amount of any Borrower Loans, together
with accrued interest, any facility fee and all other amounts payable
hereunder and under the Borrower Notes shall become immediately due and
payable without presentment, demand, protest or further notice of any kind,
all of which are hereby expressly waived; and
(iii) the Agent and the Banks may exercise any and all rights they
have under this Agreement, the other Loan Documents or at law or in equity,
and proceed to protect and enforce their respective rights by any action at
law or in equity or by any other appropriate proceeding.
No remedy conferred upon the Agent or the Banks in this Agreement or any other
Loan Document is intended to be exclusive of any other remedy, and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity or by statute
or by any other provision of law.
Section The Agent
-----------------------
. Appointment of Agent; Powers and Immunities.
-------------------------------------------
() Each Bank hereby irrevocably appoints and authorizes Fleet to
serve as the Agent hereunder and to act as its agent hereunder and under the
other Loan Documents in such capacity. Each Bank irrevocably authorizes the
Agent to take such action on behalf of each of the Banks and to exercise all
such powers as are expressly delegated to the Agent hereunder and in the other
Loan Documents and all related documents, together with such other powers as are
reasonably incidental thereto. The Agent shall not have any duties or
responsibilities or any fiduciary relationship with any Bank except those
expressly set forth in this Agreement.
() Neither the Agent nor any of its directors, officers, employees or
agents shall be responsible for any action taken or omitted to be taken by it or
them hereunder or in connection herewith, except for its or their own gross
negligence or wilful misconduct. Without limiting the generality of the
foregoing, neither the Agent nor any of its Affiliates shall be responsible to
the Banks for or have any duty to ascertain, inquire into or verify: (i) any
recitals, statements, representations or warranties made by the Borrowers or any
of their Subsidiaries or any other Person whether contained herein or otherwise;
(ii) the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement, the other Loan Documents or any other document
referred to or provided for herein or therein; (iii) any failure by the
Borrowers or any of their Subsidiaries or any other Person to perform its
obligations under any of the Loan Documents; (iv) the satisfaction of any
conditions specified in Section 5 hereof; (v) the existence, value,
collectibility or adequacy of the Collateral or any part thereof or the
validity, effectiveness, perfection or relative priority of the liens and
security interests of the Banks therein; or (vi) the filing, recording,
refiling, continuing or re-recording of any financing statement or other
document or instrument evidencing or relating to the security interests or liens
of the Banks in the Collateral, provided, however, the Agent shall have the
-------- -------
duty, subject to the terms of this Section 10, to take notice of and to act upon
any matter brought to its attention by a Bank.
() The Agent may employ agents, attorneys and other experts, shall
not be responsible to any Bank for the negligence or misconduct of any such
agents, attorneys or experts selected by it with reasonable care and shall not
be liable to any Bank for any action taken, omitted to be taken or suffered in
good faith by it in accordance with the advice of such agents, attorneys and
other experts. Fleet in its separate capacity as a Bank shall have the same
rights and powers under the Loan Documents as the other Bank and may exercise or
refrain from exercising the same as though it were not the Agent, and Fleet and
its Affiliates may accept deposits from, lend money to and generally engage in
any kind of business with the Borrowers as if it were not the Agent.
. Actions By Agent. () The Agent shall be fully justified in
----------------
failing or refusing to take any action under this Agreement as it reasonably
deems appropriate unless it shall first have received such advice or concurrence
of the Banks and shall be indemnified to its reasonable satisfaction by the
Banks against any and all liability and expense which may be incurred by it by
reason of taking or continuing to take any such action. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, under this
Agreement or any of the Loan Documents in accordance with a request of the
Banks, and such request and any action taken or failure to act pursuant thereto
shall be binding upon the Banks and all future holders of the Borrower Notes.
() Whether or not an Event of Default shall have occurred, the Agent
may from time to time exercise such rights of the Agent and the Banks under the
Loan Documents as it determines may be necessary or desirable to protect the
Collateral and the interests of the Agent and the Banks therein and under the
Loan Documents.
() The Agent shall not incur any liability by acting in reliance on
any notice, consent, certificate, statement or other writing (which may be a
bank wire, telex, facsimile or similar writing) believed by it to be genuine or
to be signed by the proper party or parties.
. Indemnification. Without limiting the obligations of the Borrowers
---------------
hereunder or under any other Loan Document, the Banks agree to indemnify the
Agent, ratably in accordance with their respective Total Commitment Percentages,
for any and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever which may at any time be imposed on, incurred by or asserted against
the Agent in any way relating to or arising out of this Agreement or any other
Loan Document or any documents contemplated by or referred to herein or therein
or the transactions contemplated hereby or thereby or the enforcement of any of
the terms hereof or thereof or of any such other documents; provided, however,
-------- -------
that no Bank shall be liable for any of the foregoing to the extent they result
from the gross negligence or willful misconduct of the Agent.
. Reimbursement. Without limiting the provisions of Section 10.3,
-------------
the Banks and the Agent hereby agree that the Agent shall not be obliged to make
available to any Person any sum which the Agent is expecting to receive for the
account of that Person until the Agent has determined that it has received that
sum. The Agent may, however, disburse funds prior to determining that the sums
which the Agent expects to receive have been finally and unconditionally paid to
the Agent, if the Agent wishes to do so. If and to the extent that the Agent
does disburse funds and it later becomes apparent that the Agent did not then
receive a payment in an amount equal to the sum paid out, then any Person to
whom the Agent made the funds available shall, on demand from the Agent, refund
to the Agent the sum paid to that Person. If the Agent in good faith reasonably
concludes that the distribution of any amount received by it in such capacity
hereunder or under the Loan Documents might involve it in liability, it may
refrain from making distribution until its right to make distribution shall have
been adjudicated by a court of competent jurisdiction. If a court of competent
jurisdiction shall adjudge that any amount received and distributed by the Agent
is to be repaid, each Person to whom any such distribution shall have been made
shall either repay to the Agent its proportionate share of the amount so
adjudged to be repaid or shall pay over the same in such manner and to such
Persons as shall be determined by such court.
. Non-Reliance on Agent and Other Banks. Each Bank represents that
-------------------------------------
it has, independently and without reliance on the Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of the financial condition and affairs of the Borrowers and
decision to enter into this Agreement and the other Loan Documents and agrees
that it will, independently and without reliance upon the Agent or any other
Bank, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own appraisals and decisions in taking or not
taking action under this Agreement or any other Loan Document. The Agent shall
not be required to keep informed as to the performance or observance by the
Borrowers of this Agreement, the other Loan Documents or any other document
referred to or provided for herein or therein
or by any other Person of any other agreement or to make inquiry of, or to
inspect the properties or books of, any Person. Except for notices, reports and
other documents and information expressly required to be furnished to the Banks
by the Agent hereunder, if any, the Agent shall not have any duty or
responsibility to provide any Bank with any credit or other information
concerning any person which may come into the possession of the Agent or any of
its affiliates. Each Bank shall have access to all documents relating to the
Agent's performance of its duties hereunder at such Bank's request. Unless any
Bank shall promptly object to any action taken by the Agent hereunder (other
than actions to which the provisions of Section 12.6(b) are applicable and other
than actions which constitute gross negligence or willful misconduct by the
Agent), such Bank shall conclusively be presumed to have approved the same.
. Resignation or Removal of Agent. The Agent may resign at any time
-------------------------------
by giving 30 days prior written notice thereof to the Banks and the Borrowers.
Upon any such resignation, the Banks shall have the right to appoint a successor
Agent which shall be Fleet or another financial institution reasonably
acceptable to the Borrowers and shall be a Bank or another financial institution
having a combined capital and surplus in excess of $100,000,000. If no
successor Agent shall have been so appointed by the Banks and shall have
accepted such appointment within 30 days after the retiring Agent's giving of
notice of resignation, then the retiring Agent may, on behalf of the Banks,
appoint a successor Agent which shall be reasonably acceptable to the Borrowers
and shall be a financial institution having a combined capital and surplus in
excess of $100,000,000. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations hereunder. After any retiring Agent's resignation, the provisions
of this Agreement shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent.
. Ratable Sharing
---------------
The Banks hereby agree among themselves that if any of them shall,
whether by voluntary payment, by realization upon security, through the exercise
of any right of set-off or banker's lien, by counterclaim or cross action or by
the enforcement of any right under the Loan Documents or otherwise, or as
adequate protection of a deposit treated as cash collateral under the Bankruptcy
Code, receive payment or reduction of a proportion of the aggregate amount of
principal, interest, fees and other amounts then due and owing to that Bank
hereunder or under the other Loan Documents (collectively, the "Aggregate
---------
Amounts Due") to such Bank) which is greater than the proportion received by any
-----------
other Bank in respect of the Aggregate Amounts Due to such other Bank, then the
Bank receiving such proportionately greater payment shall (i) notify the Agent
and each other Bank of the receipt of such payment and (ii) apply a portion of
such payment to purchase participations (which it shall be deemed to have
purchased from each seller of a participation simultaneously upon the receipt by
such seller of its portion of such payment) in the Aggregate Amounts Due to the
other Banks so that all such recoveries of Aggregate Amounts Due shall be shared
by all Banks in proportion to the Aggregate Amounts Due to them; provided that
--------
if all or part of such proportionately greater payment received by such
purchasing Bank is thereafter recovered from such Bank upon the bankruptcy or
reorganization of Borrower or otherwise, those purchases shall be rescinded and
the purchase prices paid for such participations shall be returned to such
purchasing Bank ratably to the extent of such recovery, but without interest.
The Borrowers expressly consents to the foregoing arrangement and agrees that
any holder of a participation so purchased may exercise any and all rights of
banker's lien, set-off or counterclaim with respect to any and all monies owing
by the Borrowers to that holder with respect thereto as fully as if that holder
were owed the amount of the participation held by that holder.
Section Definitions.
--------------------------
. Certain Definitions.
-------------------
"Accountants" means KMPG Peat Marwick or another accountant firm of
-----------
national reputation or other certified public accountants selected by the
Borrower and approved by the Banks.
"Affiliate" means, with respect to any specified Person (the "Specified
--------- ---------
Person"), any Person directly or indirectly controlling, controlled by or under
------
direct or indirect common control with, the Specified Person and, without
limiting the generality of the foregoing, includes (i) any director or officer
of the Specified Person or any Affiliate of the Specified Person, (ii) any such
director's or officer's parent, spouse, child or child's spouse (a "relative"),
--------
(iii) any group acting in concert, of one or more such directors, officers,
relatives or any combination thereof (a "group"), (iv) any Person controlled by
-----
any such director, officer, relative or group in which any such director,
officer, relative or group beneficially owns or holds 5% or more of any class of
voting securities or a 5% or greater equity or profits interest and (v) any
Person or group which beneficially owns or holds 5% or more of any class of
voting securities or a 5% or greater equity or profits interest in the Specified
Person. For the purposes of this definition, the term "control" when used with
respect to any Specified Person means the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of such
Specified Person, whether through the ownership of voting securities, by
contract or otherwise.
"Aggregate Letter of Credit Usage" means, at any time, the aggregate at
--------------------------------
such time of (a) the maximum amount then available to be drawn under all
outstanding Letters of Credit, and (b) all then unreimbursed drawings under any
Letters of Credit.
"Agreement" shall mean this Amended and Restated Credit Agreement.
---------
"Amendment to Security and Guaranty Agreements" shall have the meaning
---------------------------------------------
specified in Section 4.1.
"Banking Day" shall mean any day, excluding Saturday and Sunday and
-----------
excluding any other day which in the Commonwealth of Massachusetts or the State
of California is a legal holiday or a day on which banking institutions are
authorized by law to close.
"Borrower Loans" shall have the meaning specified in Section 3.1(f).
--------------
"Borrower Notes" shall have the meaning specified in Section 2.2.
--------------
"Borrower Property" means any real property owned, occupied, or operated by
-----------------
either Borrower or any of their Subsidiaries.
"Capital Lease Obligations" means, as to any Person, the obligations of
-------------------------
such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) real and/or personal property which obligations are
required to be classified and accounted for as a capital lease on a balance
sheet of such Person under GAAP (including Statement of Financial Accounting
Standards No. 13 of the Financial Accounting Standards Board) and, for purposes
of this Agreement, the amount of such obligations shall be the capitalized
amount thereof, determined in accordance with GAAP (including FASB Statement No.
13).
"Code" means the Internal Revenue Code of 1986, as amended, or any
----
successor statute.
"Collateral" shall have the meaning given that term in the Security
----------
Agreement.
"Commitments" means, with respect to any Bank, its Working Capital Line
-----------
Commitment and, if applicable, its Equipment Line Commitment and its 1997
Equipment Line Commitment.
"Contractual Obligation" means, as to any Person, any provision of any
----------------------
security (as such term is defined in the Securities Act of 1933, as amended)
issued by such Person or of any agreement,
instrument or other undertaking to which such Person is a party or by which it
or any of its property is bound.
"Controlled Group" means all members of a controlled group of corporations
----------------
and all trades or businesses (whether or not incorporated) under common control
which, together with the Borrower, are treated as a single employer under
Section 414 of the Code.
"1995 Credit Agreement" shall have the meaning specified in the preamble.
---------------------
"Current Liabilities" means, at any time, all liabilities of the Borrowers
-------------------
and their Subsidiaries at such time, on a consolidated basis, that would be
classified as current liabilities in accordance with GAAP, including, without
limitation, all Indebtedness of the Borrowers and their Subsidiaries payable on
demand or maturing within one year of such time, or renewable at the option of
the Borrowers or such Subsidiary for a period of not more than one year from
such time, and all serial maturity and periodic or installment payments on any
Indebtedness, to the extent such payments are required to be made within one
year from such time.
"Default" means any condition or event that constitutes an Event of Default
-------
or that with the giving of notice or lapse of time or both would, unless cured
or waived, become an Event of Default.
"Domestic Delinquency Reserve Amount" means an amount equal to four percent
-----------------------------------
(4%) of all Eligible Domestic Accounts Receivable.
"Eligible Domestic Accounts Receivable" means an account receivable owing
-------------------------------------
to either Borrower which met the following specifications at the time it came
into existence and continues to meet the same until it is collected in full:
(a) The original stated maturity of the account is not more than 90
days after the invoice date thereof, and the account (regardless of its
stated maturity date) does not remain unpaid more than 90 days after such
invoice date.
(b) The account arose from the performance of services or an outright
sale of goods by such Borrower, such goods have been shipped to the account
debtor, and the Borrower has possession of, or has delivered to the Agent,
shipping and delivery receipts evidencing such shipment.
(c) The account is owned solely by such Borrower, and is not subject
to any assignment, claim, lien, or security interest, other than a security
interest in favor of Fleet as Agent for the Banks.
(d) The account is not one with respect to which the account debtor
has exercised any rights of set-off, credit, allowance or adjustment which
is not reflected in the dollar amount of the receivable; the account is not
one as to which the account debtor disputes liability or makes any claim
with respect thereto or as to which the Banks believe, in their sole
discretion, that there may be a basis for dispute (but only to the extent
of the amount subject to such dispute or claim), or which involves an
account debtor subject to any insolvency proceeding, or becomes insolvent,
or goes out of business.
(e) The account arose in the ordinary course of such Borrower's
business and did not arise from the performance of services or a sale of
goods to a supplier or employee of the Borrower.
(f) No notice of bankruptcy or insolvency of the account debtor has
been received by or is known to the Borrowers.
(g) Such Borrower has pledged any instrument or chattel paper
evidencing the account to Fleet as Agent for the Banks pursuant to the
provisions of the Security Agreement.
(h) The aggregate accounts receivable from the account debtor
(including their Subsidiaries and Affiliates) do not exceed 25% of the
total Eligible Accounts Receivable of the Borrowers; that portion of the
account over the 25% level will be disqualified. Provided, however, that
-------- -------
this subsection (h) shall not apply to disqualify any accounts receivable
due to the Borrowers from Motorola, Ericsson, Lucent or Nokia.
(i) The account does not relate to goods placed on consignment,
guaranteed sale, sale or return, sale on approval, xxxx and hold, or other
terms by reason of which the payment by the account debtor may be
conditional.
(j) The account debtor is not an Affiliate, officer, employee or
agent of either Borrower.
(k) The account debtor is not a Governmental Authority.
(l) The Borrowers do not owe any amounts to the account debtor for
goods sold, services rendered or otherwise; to the extent that any amounts
are so owed, the accounts of such account debtor in an amount equal to the
amounts owed by the Borrowers to the account debtor shall be disqualified.
(m) The Banks have not notified the Borrowers that the Banks have
determined that an account or account debtor is unsatisfactory for credit
reasons (which determination shall not be made unreasonably).
(n) The account debtor is a person or entity located in the United
States and the account arose out of services rendered or goods delivered in
the United States.
"Eligible International Accounts Receivable" means an account receivable
------------------------------------------
owing to either Borrower which met the requirements set forth in clauses (a)
through (m) for Eligible Domestic Accounts Receivable and also the following
specifications at the time it came into existence and continues to meet the same
until it is collected in full:
(a) The account debtor is a Person located outside the United States
and the account arose out of services rendered or goods delivered outside the
United States; and
(b) The obligations of the account debtor under such account are
supported either (i) by a transferable commercial letter of credit or standby
letter of credit issued for the account of the account debtor and for the
benefit of such Borrower by a bank or other financial institution approved by
the Banks in writing (and not subsequently disapproved), that (A) is payable in
the United States, (B) provides for the full payment to such Borrower or its
transferee of such account receivable, either (x) upon shipment of goods or the
provision of services and upon presentation of documentation that such goods
have been shipped or that such services have been provided, or (y) upon default
in payment of such account receivable in accordance with its terms, and (C) has
been delivered and pledged to Fleet as Agent for the Banks or (ii) by insurance
covering such obligations with terms that have been approved by the Banks in
writing and underwritten by an insurer that has been approved by the Banks in
writing (and not subsequently disapproved), or are those of an account debtor
--
that has been approved in writing by both Banks in their sole discretion (which
approval has not been subsequently cancelled or withdrawn). A list of account
debtors approved by the Bank as of the date of this Agreement is attached hereto
as Schedule B.
----------
"Eligible Equipment" means any items of equipment that either Borrower has
------------------
requested that Fleet finance the purchase of through an advance under the
Equipment Line Commitment or the 1997 Equipment Line Commitment, and which, both
on the date of such request and the date of such advance, meets the following
requirements:
() such equipment is not (i) telephone equipment, (ii) office
furniture, (iii) a fixture or leasehold improvement, (iv) a motor vehicle,
(v) software or (vi) intended by the Borrower to become a fixture or
leasehold improvement;
() such equipment has been purchased by the Borrower from the
manufacturer or a distributor thereof, has not been put in service by any
Person prior to the date of the invoice furnished to the Borrower by such
manufacturer or distributor, and has an invoice date (i) not earlier than
April 3, 1995 in the case of Equipment Line of Credit Loans and (ii) not
earlier than April 1, 1997 in the case of 1997 Equipment Line of Credit
Loans;
() such equipment is owned solely by the Borrower and is not subject
to any leasehold interest, assignment, claim, lien or security interest,
(other than a security interest in favor of Fleet as Agent for the Banks
pursuant to the Security Agreement or any other right, title of interest of
any third party;
() such equipment is located in The Commonwealth of Massachusetts,
the State of Maryland or the State of California and is in the possession
of the Borrower; and
() if such equipment is or is to be located on premises leased by the
Borrower, Fleet has received a landlord's waiver in form and substance
satisfactory to Fleet from the landlord of such premises.
"Environmental Laws" means all federal, state, local and foreign laws, and
------------------
all regulations, notices or demand letters issued, promulgated or entered
thereunder, relating to pollution or protection of the environment and to
occupational health and safety, including, without limitation, laws relating to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals, or Hazardous Substances into the environment
(including, without limitation, ambient air, surface water, ground water, land
surface or subsurface strata) or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, chemicals or Hazardous Substances.
"Equipment Line Commitment" shall have the meaning set forth in Section
-------------------------
2.1.
"1997 Equipment Line Commitment" shall have the meaning set forth in
------------------------------
Section 2A.1.
"Equipment Line Commitment Expiration Date" shall have the meaning
-----------------------------------------
specified in Section 2.1.
"1997 Equipment Line Commitment Expiration Date" shall have the meaning
----------------------------------------------
specified in Section 2A.1.
"Equipment Line of Credit Loans" shall have the meaning set forth in
------------------------------
Section 2.1.
"1997 Equipment Line of Credit Loans" shall have the meaning set forth in
-----------------------------------
Section 2A.1.
"Equipment Line Maturity Date" shall have the meaning specified in Section
----------------------------
2.5, 2.6(b).
"1997 Equipment Line Maturity Date" shall have the meaning specified in
---------------------------------
Section 2A.5.
"Equipment Line Note" shall have the meaning set forth in Section 2.2.
-------------------
"1997 Equipment Line Note" shall have the meaning set forth in Section
------------------------
2A.2.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
-----
amended, or any successor statutes.
"Event of Default" has the meaning set forth in Section 9.1.
----------------
"Financial Statements Date" means April 2, 1995.
-------------------------
"GAAP" means accounting principles generally accepted in the United States
----
applied on a consistent basis.
"Governmental Approvals" shall mean any authorization, consent, order,
----------------------
approval, license, lease, ruling, permit, tariff, rate, certification,
validation, exemption, filing or registration by or with, or notice to, any
Governmental Authority.
"Governmental Authority" shall mean any federal, state, municipal or other
----------------------
governmental department, commission, board, bureau, agency, court, tribunal or
other instrumentality, domestic or foreign, and any arbitrator.
"Guarantee" by any Person means any obligation, contingent or otherwise, of
---------
such Person directly or indirectly guaranteeing any Indebtedness or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise of such
Person (a) to purchase or pay (or advance or supply funds for the purchase or
payment of) such Indebtedness or other obligation (whether arising by virtue of
partnership arrangements, by agreement to keep-well, to purchase assets, goods,
securities or services, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (b) entered into for the purpose of assuring in any
other manner the obligee of such Indebtedness or other obligation of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided that the term Guarantee shall not include endorsements for
--------
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Guarantor" shall have the meaning specified in Section 4.2.
---------
"Guarantor Security Agreement" shall have the meaning specified in Section
----------------------------
4.2.
"Hazardous Substances" shall mean all hazardous and toxic substances,
--------------------
wastes or materials, hydrocarbons (including naturally occurring or man-made
petroleum and hydrocarbons), flammable explosives, urea formaldehyde insulation,
radioactive materials, biological substances, PCBs, pesticides, herbicides and
any other kind and/or type of pollutants, or contaminates and/or any other
similar substances or materials which, because of toxic, flammable, explosive,
corrosive, reactive, radioactive or other properties that may be hazardous to
human health or the environment, are included under or regulated by any
Environmental Laws.
"Indebtedness" of any Person at any date shall mean, (a) all indebtedness
------------
of such Person for borrowed money or for the deferred purchase price of property
or services (excluding current trade liabilities incurred in the ordinary course
of business and payable in accordance with customary practices, but including
any class of capital stock of such Person with fixed payment obligations or with
redemption at the option of the holder), or which is evidenced by a note, bond,
debenture or similar instrument, (b) all Capital Lease Obligations of such
Person, (c) all obligations of such Person in respect of acceptances issued or
created for the account of such Person, and all reimbursement obligations
(contingent or otherwise) of such Person in respect of any letters of credit
issued for the account of such Person, and (d)
all liabilities secured by any Lien on any property owned by such Person even
though such Person has not assumed or otherwise become liable for the payment
thereof.
"Intellectual Property" shall have the meaning specified in Section 6.16.
---------------------
"Interest Period" means, with respect to any LIBOR Loan, the period
---------------
commencing on the date such LIBOR Loan is converted from a Prime Rate Loan or
the last day of the next preceding Interest Period with respect to such LIBOR
Loan and ending on the numerically corresponding day in the first, second or
third calendar month thereafter, as the Borrower may select as provided in
Section 3.6, except that each such Interest Period which commences on the last
Banking Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on the
last Banking Day of the appropriate subsequent calendar month.
"International Delinquency Reserve Amount" means an amount equal to five
----------------------------------------
percent (5%) of all Eligible International Accounts Receivable.
"Investments" means, with respect to any Person (the "Investor"), (a) any
----------- --------
investment by the Investor in any other Person, whether by means of share
purchase, capital contribution, purchase or other acquisition of a partnership
or joint venture interest, loan, time deposit, demand deposit or otherwise and
(b) any Guarantee by either Borrower of any Indebtedness or other obligation of
any other Person.
"Letter of Credit" means any commercial letter of credit or standby letter
----------------
of credit issued by the Banks or either Bank for the account of either Borrower
as provided in this Agreement.
"LIBOR Loan" means, at any time, that principal amount of the Equipment
----------
Line of Credit Loans or the 1997 Equipment Line of Credit Loans, the interest on
which is determined at such time on the basis of rates referred to in the
definition of "LIBOR Rate".
"LIBOR Rate" means with respect to any Interest Period pertaining to a
----------
LIBOR Loan, the rate per annum (rounded upwards, if necessary, to the nearest
1/16th of 1%) equal to the quotient of the rate determined by the Agent to be
the prevailing per annum rate at which deposits in U.S. dollars are offered to
such Bank by first-class banks two Working Days prior to the beginning of such
Interest Period in the London interbank market at or about 10:00 a.m., Boston
time, for delivery on the first day of such Interest Period for the number of
days comprised therein and in an amount equal to the amount of the LIBOR Loan to
be outstanding during such Interest Period, divided by (b) a number equal to
1.00 minus the Reserve Requirement for such LIBOR Loan during such Interest
Period.
"Lien" means any mortgage, pledge, hypothecation, conditional or collateral
----
assignment, deposit arrangement, encumbrance, lien (statutory or other), or
preference, priority or other security agreement of any kind or nature
whatsoever (including, without limitation, any conditional sale or other title
retention agreement, any lease that should be capitalized in accordance with
GAAP, and the filing of a financing statement under the Uniform Commercial Code
or comparable law of any jurisdiction), together with any renewal or extension
thereof.
"Loan Documents" means, collectively, this Agreement, the Borrower Notes,
--------------
the Guaranties, the Financing Statements, the Security Instruments, and all
other agreements and instruments that are from time to time executed in
connection with this Agreement, as each of such agreements and instruments may
be amended, modified or supplemented from time to time.
"Material Adverse Effect" means a material adverse effect on (a) the
-----------------------
business, operations, property, condition (financial or otherwise) or prospects
of either Borrower, or of the Borrowers and their Subsidiaries taken as a whole,
(b) the ability of either Borrower to perform its obligations under this
Agreement, the Borrower Notes or any of the other Loan Documents, or (c) the
validity or enforceability of
this Agreement, the Borrower Notes or any of the other Loan Documents, or the
rights or remedies of the Banks hereunder or thereunder.
"Multiemployer Plan" means at any time an employee pension benefit plan
------------------
within the meaning of Section 4001(a)(3) of ERISA to which either Borrower or
any member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding five plan years made
contributions, including for these purposes any Person which ceased to be a
member of the Controlled Group during such five year period.
"Net Income" or "Net Loss" for any period in respect of which the amount
---------- --------
thereof shall be determined, shall mean the aggregate of the consolidated net
income (or net loss) after taxes for such period (taken as a cumulative whole)
of the Borrowers and their Subsidiaries, determined in accordance with GAAP,
exclusive of the write-up of any asset.
"Obligations" shall have the meaning given the term "Secured Obligations"
-----------
in the Security Agreement.
"Office of the Bank" shall mean (a) in the case of SVB, the banking office
------------------
of SVB located at 0000 Xxxxxx Xxxxx, Xxxxx Xxxxx, Xxxxxxxxxx 00000, or such
other location of which SVB shall notify the Borrowers, and (b) in the case of
Fleet, the banking office of Fleet located at Fleet Center, 00 Xxxxx Xxxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000-0000, or such other location of which Fleet shall
notify the Borrower.
"Original Closing Date" shall have the meaning specified in Section 4.1.
---------------------
"PBGC" means the Pension Benefit Guaranty Corporation or any entity
----
succeeding to any or all of its functions under ERISA.
"Permitted Liens" shall have the meaning set forth in Section 8.6.
---------------
"Person" shall mean and include any individual, firm, corporation, trust or
------
other unincorporated organization or association or other enterprise or any
government or political subdivision, agency, department or instrumentality
thereof.
"Plan" means any employee pension benefit plan which is covered by Title IV
----
of ERISA or subject to the minimum funding standards under Section 412 of the
Code and is either (a) maintained by either Borrower or any member of the
Controlled Group for employees of either Borrower or any member of the
Controlled Group or (b) maintained pursuant to a collective bargaining agreement
or any other arrangement under which more than one employer makes contributions
and to which either Borrower or any member of the Controlled Group is then
making or accruing an obligation to make contributions or has within the
preceding five plan years made contributions.
"Pledge Agreement" shall have the meaning set forth in Section 4.1.
----------------
"Post-Default Rate" means, in respect of any principal of the Working
-----------------
Capital Line of Credit Loans, the Equipment Line of Credit Loans, the 1997
Equipment Line of Credit Loans or any other amount payable by either Borrower
under this Agreement which is not paid when due (whether at stated maturity, by
acceleration or otherwise, a rate per annum during the period commencing on the
due date until such amount is paid in full (after as well as before judgment)
equal to the sum of 3% plus the higher of (i) the rate of interest applicable to
Prime Rate Loans and (ii) in the case of any LIBOR Loan, the rate of interest
otherwise applicable to such LIBOR Loan.
"Prime Rate" shall mean the per annum rate of interest from time to time
----------
announced and made effective by Fleet as its Prime Rate (which rate may or may
not be the lowest rate available from the Bank at any given time).
"Purchase Money Indebtedness" shall mean Indebtedness incurred to finance
---------------------------
the acquisition of assets or the cost of improvements on real property or
leaseholds, in each case in an amount not in excess of the lesser of (a) the
purchase price or acquisition cost of said assets or the cost of said
improvements and (b) the fair market value of said assets or said improvements
on the date of acquisition of said assets or contract for said improvements.
"Purchase Money Security Interest" shall mean (a) a security interest
--------------------------------
securing Purchase Money Indebtedness, which security interest applies solely to
the particular assets acquired with the Purchase Money Indebtedness that said
Purchase Money Security Interest secures, and (b) the renewal, extension and
refunding of such Purchase Money Indebtedness in an amount not exceeding the
amount thereof remaining unpaid immediately prior to such renewal, extension or
refunding.
"Quick Ratio" means, at any time, all cash and accounts receivable, less
-----------
reserves for doubtful accounts, less advance xxxxxxxx to customers, of the
Borrowers and their Subsidiaries at such time, on a consolidated basis,
determined in accordance with GAAP, divided by the sum (without duplication) of
(a) the aggregate of all Current Liabilities at such time, (b) then outstanding
Working Capital Extensions of Credit and (c) the current portion of long-term
Indebtedness (other than outstanding Equipment Line of Credit Loans and 1997
Equipment Line of Credit Loans) of the Borrowers and their Subsidiaries as
determined in accordance with GAAP.
"Regulation D" means Regulation D of the Board of Governors of the Federal
------------
Reserve System as the same may be amended or supplemented from time to time.
"Regulatory Change" means any change on or after the date of this Agreement
-----------------
in United States federal, state or foreign laws or regulations, including
Regulation D, or the adoption or making on or after such date of any
interpretations, directives or requests applying to a class of lenders including
the Banks of or under any United States federal or state, or any foreign, laws
or regulations (whether or not having the force of law) by any court or
governmental or monetary authority charged with the interpretation or
administration thereof (other than changes which affect taxes measured by or
imposed on the overall net income of any Bank by the jurisdiction in which such
Bank has its principal office.
"Reserve Requirement" means, for any LIBOR Loans for any Interest Period
-------------------
therefor, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by the Bank against "Eurocurrency
liabilities" (as such term is used in Regulation D).
"Restricted Payment" means, with respect to either Borrower or any
------------------
Subsidiary thereof, (a) any dividend or other distribution on any shares of
capital stock of Stock Borrower or such Subsidiary (except dividends payable
solely in shares of capital stock or rights to acquire capital stock of Alpha,
and cash dividends payable solely to either Borrower by a Subsidiary), (b) any
payment on account of the purchase, redemption, retirement or acquisition of (i)
any shares of the capital stock of any Borrower or a Subsidiary thereof or (ii)
any option, warrant, convertible security or other right to acquire shares of
the capital stock of any Borrower or a Subsidiary thereof, other than, in either
case, payments made solely to Alpha by a Subsidiary, and (c) any payment of any
principal of, or premium or interest on, or any required or optional purchase,
redemption or other retirement or other acquisition of any Subordinated Debt of
any Borrower other than on terms expressly permitted under the subordination
provisions approved by the Banks.
"SEC" means the Securities and Exchange Commission.
---
"Security Agreement" shall have the meaning set forth in Section 4.1.
------------------
"Security Instruments" means, collectively, the Security Agreement, the
--------------------
Pledge Agreement and the Guarantor Security Agreements, and each other
instrument or agreement that purports to secure the Obligations of the Borrower
to the Banks.
"Subordinated Debt" means Indebtedness of the Borrower that is subordinated
-----------------
to the Indebtedness of the Borrower owing to the Banks either (a) pursuant to a
subordination agreement in form and substance satisfactory to the Banks between
the Banks and the holder(s) of such Indebtedness, or (b) pursuant to the terms
thereof, where the Banks have confirmed in writing that such terms are
satisfactory to them.
"Subsidiary" means, with respect to any Person, any corporation or other
----------
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other Persons performing
similar functions are at the time directly or indirectly owned by such Person.
"Tangible Net Worth" means, at any time, the consolidated stockholders'
------------------
equity of the Borrower and their Subsidiaries at such time determined in
accordance with GAAP, less all assets that are reflected on the consolidated
----
balance sheet of the Borrowers and their Subsidiaries at such time that would be
treated as intangibles under GAAP (including, but not limited, to goodwill,
capitalized software and excess purchase costs), plus all then outstanding
----
Subordinated Debt.
"Total Commitment Percentage" shall mean, with respect to any Bank, that
---------------------------
Bank's Working Capital Line Commitment, Equipment Line Commitment and 1997
Equipment Line Commitment expressed as a percentage of the Total Working Capital
Line Commitment, the total Equipment Line Commitment and the total 1997
Equipment Line Commitment.
"Total Senior Liabilities" means, at any time, the consolidated liabilities
------------------------
of the Borrowers and their Subsidiaries at such time, determined in accordance
with GAAP, less all then outstanding Subordinated Debt.
----
"Type" shall refer to the determination of whether an Equipment Line of
----
Credit Loan or a 1997 Equipment Line of Credit Loan is a Prime Rate Loan or a
LIBOR Loan, each of which shall constitute a Type.
"UCC" shall have the meaning given such term in the Security Agreement.
---
"Unfunded Liabilities" means, with respect to any Plan, at any time, the
--------------------
amount (if any) by which (a) the present value of all benefits under such Plan
exceeds (b) the fair market value of all Plan assets allocable to such benefits,
all determined as of the then most recent valuation date for such Plan, but only
to the extent that such excess represents a potential liability of the Borrower
or any member of the Controlled Group to the PBGC or such Plan under Title IV of
ERISA.
"Working Capital Borrowing Base" shall have the meaning specified in
------------------------------
Section 1.5.
"Working Capital Commitment Expiration Date" shall have the meaning
------------------------------------------
specified in Section 1.1.
"Working Capital Commitment Percentage" shall mean, with respect to any
-------------------------------------
Bank, that Bank's Working Capital Line Commitment expressed as a percentage of
the Total Working Capital Line Commitment.
"Working Capital Extension of Credit" shall have the meaning set forth in
-----------------------------------
Section 1.5.
.
"Working Capital Line Commitment" shall have the meaning specified in
-------------------------------
Section 1.1
"Working Capital Line of Credit Loans" shall have the meaning specified in
------------------------------------
Section 1.1
"Working Capital Note" shall have the meaning set forth in Section 1.3.
--------------------
"Working Day" means any day on which dealings in foreign currencies and
-----------
exchange between banks may be carried on in the place where the Eurodollar
Lending Office is located and in Boston, Massachusetts and San Jose, California.
Section Miscellaneous.
----------------------------
. Accounting Terms and Definitions. Unless otherwise specified
--------------------------------
herein, all accounting terms used herein shall be interpreted, all
determinations with respect to accounting matters hereunder shall be made, and
all financial statements and certificates and reports as to financial matters
required to be delivered hereunder shall be prepared, in accordance with GAAP;
provided that if any change in GAAP in itself materially affects the calculation
--------
of any financial covenant in this Agreement, the Borrowers may by notice to the
Banks, or the Banks may by notice to the Borrower, require that such covenant
thereafter be calculated in accordance with GAAP as in effect, and applied by
the Borrowers, immediately before such change in GAAP occurs. If such notice is
given, the compliance certificates delivered pursuant to Section 7.4(c) after
such change occurs shall be accompanied by reconciliations of the difference
between the calculation set forth therein and a calculation made in accordance
with GAAP as in effect from time to time after such change occurs. To enable
the ready determination of compliance with the covenants set forth in this
Agreement, the Borrowers will not change the date on which their fiscal year or
any of their fiscal quarters end without thirty (30) days' prior notice to the
Banks.
. Amendments, Etc. No amendment or waiver of any provision of this
---------------
Agreement or the Borrower Notes, nor consent to any departure by the Borrowers
therefrom, shall in any event be effective unless the same shall be in writing
and signed by all the Banks and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
. Notices, Etc. All notices and other communications provided for
------------
hereunder shall be in writing and shall be delivered by hand, by a nationally
recognized commercial overnight delivery service, by first class mail or by
telecopy, delivered, addressed or transmitted, if to the Borrowers, at the
following address: 00 Xxxxxx Xxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxx
X. Xxxxxxx, Chief Financial Officer, Telecopy No. (000) 000-0000, with a copy to
the attention of the Legal Department of the Borrower at the same address; if to
SVB, at its address at Wellesley Xxxxxx Xxxx, 00 Xxxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxxxxxxx 00000, Attention: Xxxx X. Xxxxx, Vice President, Telecopy No.
(000) 000-0000; and if to Fleet, at its address at Fleet Center, 00 Xxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-0000, Attention: Xxxxx X. Case, Assistant
Vice President, with a copy in the case of any notice to a Bank, to Xxxxxxxx &
Worcester LLP, Xxx Xxxx Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention
Xxxxxx X. Xxxxx, Esq., Telecopy No. (000) 000-0000 or, as to each party, at such
other address as shall be designated by such party in a written notice to the
other party. All such notices and communications shall be deemed effective, (a)
in the case of hand deliveries, when delivered; (b) in the case of an overnight
delivery service, on the next Banking Day after being placed in the possession
of such delivery service, with delivery charges prepaid; (c) in the case of
mail, three days after deposit in the postal system, first class postage
prepaid; and (d) in the case of telecopy notices, when electronic indication of
receipt is received, except that notices to any Bank pursuant to the provisions
of Section 1.7 shall not be effective until received by such Bank.
. No Waiver; Remedies. No failure on the part of any Bank to
-------------------
exercise, and no delay in exercising, any right hereunder or under the Borrower
Notes shall operate as a waiver thereof; nor shall any single or partial
exercise of any right hereunder or under the Borrower Notes preclude any other
or further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.
. Right of Set-off. () Upon the occurrence and during the
----------------
continuance of any Event of Default, each Bank is hereby authorized at any time
and from time to time, to the fullest extent permitted
by law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final) at any time held and other indebtedness at any
time owing by such Bank to or for the credit or the account of the Borrowers
against any and all of the obligations of the Borrower now or hereafter existing
under this Agreement and the Borrower Notes, irrespective of whether or not such
Bank shall have made any demand hereunder and although such obligations may be
contingent or unmatured.
() Each Bank agrees promptly to notify the Borrowers after any such
set-off and application, provided that the failure to give such notice shall not
--------
affect the validity of such set-off and application. The rights of the Banks
under this Section 12.5 are in addition to other rights and remedies
(including, without limitation, other rights of set-off) which the Banks may
have.
. Expenses; Indemnification. () The Borrowers shall pay on demand
-------------------------
(i) the reasonable fees and disbursements of counsel to the Banks in connection
with the preparation of this Agreement and the preparation or review of each
agreement, opinion, certificate and other document referred to in or delivered
pursuant hereto; (ii) all reasonable out-of-pocket costs and expenses of the
Banks in connection with the administration of this Agreement and the other Loan
Documents, (including without limitation any lien search or filing fees) and any
waiver or amendment of any provision hereof or thereof, including without
limitation, the reasonable fees and disbursements of counsel for the Banks, and
of any field examiner or auditor retained by the Banks as contemplated in
Section 7.8; and (iii) if any Event of Default occurs, all reasonable costs and
expenses incurred by the Banks, including the reasonable fees and disbursements
of counsel to the Banks, and of any appraisers, environmental engineers or
consultants, or investment banking firms retained by the Banks in connection
with such Event of Default or collection, bankruptcy, insolvency and other
enforcement proceedings related thereto. Each Borrower agrees on a joint and
several basis to pay, indemnify and hold the Banks harmless from, any and all
recording and filing fees, and any and all liabilities with respect to, or
resulting from any delay in paying, stamp, excise or other taxes, if any, which
may be payable or determined to be payable in connection with the execution and
delivery of or the consummation or administration of any of the transactions
contemplated by, or any amendment, supplement or modification of, or any waiver
or consent under or in respect of, this Agreement or the other Loan Documents,
or any documents delivered pursuant hereto or thereto.
() Each Borrower agrees on a joint and several basis to indemnify
each Bank and its officers and directors and hold such Bank and its officers and
directors harmless from and against any and all liabilities, losses, damages,
costs and expenses of any kind (including, without limitation, the reasonable
fees and disbursements of counsel for such Bank in connection with any
investigative, administrative or judicial proceeding initiated by a third party,
whether or not such Bank shall be designated a party thereto) which may be
incurred by such Bank, relating to or arising out of this Agreement or any other
Loan Document, or the existence of any Hazardous Substance on, in, or under any
Borrower Property, or any violation of any applicable Environmental Laws for
which the Borrower or any Subsidiary thereof has any liability or which occurs
upon any Borrower Property, or the imposition of any Lien under any
Environmental Laws, provided that no Bank shall have the right to be indemnified
--------
hereunder for its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction.
() The agreements in this Section 12.6 shall survive the repayment of
the Borrower Notes, and all other amounts payable under this Agreement and the
other Loan Documents.
. Binding Effect. This Agreement shall become effective when it
--------------
shall have been executed by the Borrowers and the Banks (provided, however, in
no event shall this Agreement become effective until signed by an officer of SVB
in California) and thereafter shall be binding upon and inure to the benefit of
the Borrowers and the Banks and their respective successors and assigns, except
that the Borrower shall not have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Banks. Each Bank may
assign to any financial institution all or any part of, or any interest
(undivided or divided) in, such Bank's rights and benefits under this Agreement
or the Borrower
Notes, and to the extent of that assignment such assignee shall have the same
rights and benefits against the Borrower hereunder as it would have had if such
assignee were the Bank making the Working Capital Line of Credit Loans, the
Equipment Line of Credit Loan or the 1997 Equipment Line of Credit Loan
hereunder.
. Severability. Any provision of this Agreement which is
------------
prohibited, unenforceable or not authorized in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition,
unenforceability or non-authorization without invalidating the remaining
provisions hereof or affecting the validity, enforceability or legality of such
provision in any other jurisdiction.
. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
-------------
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS.
. WAIVER OF JURY TRIAL. EACH BANK AND EACH BORROWER AGREES THAT
--------------------
NONE OF THEM NOR ANY ASSIGNEE OR SUCCESSOR SHALL (A) SEEK A JURY TRIAL IN ANY
LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER ACTION BASED UPON, OR ARISING OUT
OF, THIS AGREEMENT, ANY RELATED INSTRUMENTS, ANY COLLATERAL OR THE DEALINGS OR
THE RELATIONSHIP BETWEEN OR AMONG ANY OF THEM, OR (B) SEEK TO CONSOLIDATE ANY
SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT
BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY DISCUSSED BY THE
BANKS AND THE BORROWER, AND THESE PROVISIONS SHALL BE SUBJECT TO NO EXCEPTIONS.
NEITHER THE BANKS NOR THE BORROWERS HAVE AGREED WITH OR REPRESENTED TO THE OTHER
THAT THE PROVISIONS OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL
INSTANCES.
. VENUE, CONSENT TO SERVICE OF PROCESS. EACH BORROWER ACCEPTS FOR
------------------------------------
ITSELF AND IN CONNECTION WITH ITS PROPERTIES, GENERALLY AND UNCONDITIONALLY, THE
NON-EXCLUSIVE JURISDICTION OF ANY STATE OR FEDERAL COURT OF COMPETENT
JURISDICTION IN THE COMMONWEALTH OF MASSACHUSETTS (AND IN THE EVENT SVB IS FOR
ANY REASON DENIED ACCESS TO THE COURTS OF MASSACHUSETTS, THEN SOLELY IN SUCH
CASE, CALIFORNIA) IN ANY ACTION, SUIT OR PROCEEDING OF ANY KIND AGAINST IT WHICH
ARISES OUT OF OR BY REASON OF THIS AGREEMENT, THE BORROWER NOTES, ANY OTHER LOAN
DOCUMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IRREVOCABLY AGREES
TO BE BOUND BY ANY FINAL JUDGMENT RENDERED BY ANY SUCH COURT IN ANY SUCH ACTION,
SUIT OR PROCEEDING IN WHICH IT SHALL HAVE BEEN SERVED WITH PROCESS IN THE MANNER
HEREINAFTER PROVIDED, SUBJECT TO EXERCISE AND EXHAUSTION OF ALL RIGHTS OF APPEAL
AND TO THE EXTENT THAT IT MAY LAWFULLY DO SO, WAIVES AND AGREES NOT TO ASSERT,
BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, IN SUCH ACTION, SUIT OR PROCEEDING
ANY CLAIMS THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURT,
THAT ITS PROPERTY IS EXEMPT OR IMMUNE FROM ATTACHMENT OR EXECUTION, THAT THE
ACTION, SUIT OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE
THEREOF IS IMPROPER, AND AGREES THAT PROCESS MAY BE SERVED UPON IT IN ANY SUCH
ACTION, SUIT OR PROCEEDING IN THE MANNER PROVIDED BY CHAPTER 223A OF THE GENERAL
LAWS OF MASSACHUSETTS, RULE 4 OF THE MASSACHUSETTS RULES OF CIVIL PROCEDURE OR
RULE 4 OF THE FEDERAL RULES OF CIVIL PROCEDURE.
. Headings. Section headings in this Agreement are included herein
--------
for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
. Counterparts. This Agreement may be signed in one or more
------------
counterparts each of which shall constitute an original and all of which taken
together shall constitute one and the same instrument.
. Joint and Several Obligations. Each and every representation,
-----------------------------
warranty, covenant and agreement made by either of the Borrowers, hereunder and
under the other Loan Documents shall be joint and several, whether or not so
expressed, and such obligations of either of the Borrowers shall not be subject
to any counterclaim, setoff, recoupment or defense based upon any claim either
Borrower may have against the other Borrower or the Bank, and shall remain in
full force and effect without regard to, and shall not be released, discharged
or in any way affected by, any circumstance or condition affecting the other
Borrower, including without limitation (a) any waiver, consent, extension,
renewal, indulgence or other action or inaction under or in respect of this
Agreement or any other Loan Document, or any agreement or other document related
thereto with respect to the other Borrower, or any exercise or nonexercise of
any right, remedy, power or privilege under or in respect of any such agreement
or instrument with respect to the other Borrower, or the failure to give notice
of any of the foregoing to Trans-Tech, it being agreed by Trans-Tech that notice
in each such case to Alpha shall be sufficient and that no notice to the
Borrowers shall be effective without notice to Alpha; (b) any invalidity or
unenforceability, in whole or in part, of any such agreement or instrument with
respect to the other Borrower; (c) any failure on the part of the other Borrower
for any reason to perform or comply with any term of any such agreement or
instrument; (d) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or similar proceeding with respect to the
other Borrower or its properties or creditors; or (e) any other occurrence
whatsoever, whether similar or dissimilar to the foregoing, with respect to the
other Borrower. Each Borrower hereby waives any requirement of diligence or
promptness on the part of the Bank in the enforcement of the Bank's rights
hereunder or under any other Loan Document with respect to the obligations of
itself or of the other Borrower. Without limiting the foregoing any failure to
make any demand upon, to pursue or exhaust any rights or remedies against a
Borrower, or any delay with respect thereto, shall not affect the obligations of
the other Borrower hereunder or under any other Loan Document.
[remainder of page blank]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first above written.
ALPHA INDUSTRIES, INC.
By:_____________________________
Name:
Title:
TRANS-TECH, INC.
By:_____________________________
Name:
Title:
FLEET NATIONAL BANK, in its capacity as a Bank
and as Agent hereunder
By:______________________________
Name:
Title:
SILICON VALLEY EAST, a Division of Silicon Valley
Bank, in its capacity as
a Bank and as Collateral Agent prior to
the effectiveness hereof
By:_____________________________
Name: Xxxx X. Xxxxx
Title: Vice President
SILICON VALLEY BANK, in its capacity as
a Bank and as Collateral Agent prior to
the effectiveness hereof
By:____________________________
Name:
Title:
(Signed at Santa Clara,
California)
