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Execution Version
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Exhibit 10.1
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NEXTERA ENTERPRISES, INC.
DISCRETIONARY DEMAND CREDIT AGREEMENT
Dated as of June 25, 1999
with
BANKBOSTON, N.A.
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TABLE OF CONTENTS
1. Definitions; Certain Rules of Construction...............................1
2. The Credits..............................................................4
2.1. Discretionary Revolving Credit Facility......................4
2.2. Letters of Credit............................................4
3. Interest; Fees, etc......................................................7
3.1. Interest.....................................................7
3.2. Capital Adequacy, etc........................................8
3.3. Letter of Credit Fee.........................................8
3.4. Computations of Interest.....................................8
4. Payment..................................................................8
4.1. Payment upon Demand or at Maturity...........................8
4.2. Voluntary Prepayments of Loan................................9
4.3. Reborrowing..................................................9
5. Conditions to Extending Credit...........................................9
5.1. Officer's Certificate........................................9
5.2. Note.........................................................9
5.3. Legal Opinion................................................9
5.4. Guarantee and Security Agreement.............................9
5.5. Perfection of Security.......................................9
5.6. Fees.........................................................9
5.7. Other Outstanding Debt......................................10
5.8. No Material Litigation......................................10
5.9. No Material Default of any Material Contract................10
5.10. Repayment of Outstanding Debt..............................10
5.11. Release of Certain Security Interests......................10
5.12. Minimum EBITDA.............................................10
5.13. Other Lender Confirmation..................................10
5.14. Proper Proceedings.........................................10
5.15. Legality, etc..............................................11
5.16. General....................................................11
6. Representations and Warranties..........................................11
6.1. Organization and Business...................................11
6.2. Financial Statements and Other Information..................11
6.3. Changes in Condition........................................12
6.4. Litigation..................................................12
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6.5. No Legal Obstacle to Agreements.............................12
6.6. Taxes.......................................................13
7. Certain Actions Following a Default.....................................13
7.1. Exercise of Rights..........................................13
7.2. Setoff......................................................13
7.3. Cumulative Remedies.........................................13
8. Expense; Indemnity......................................................13
8.1. Expenses....................................................13
8.2. General Indemnity...........................................13
9. Successors and Assigns; Agent...........................................14
10. Notices................................................................14
11. Course of Dealing, Amendments and Waivers..............................15
12. WAIVER OF JURY TRIAL...................................................15
13. Venue; Service of Process; Certain Waivers.............................16
14. General................................................................16
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EXHIBITS
2 - Form of Note
2.1.1 - Letters of Credit to be Provided at Closing
2.2 - Current Standby Letter of Credit Application and Agreement Form of
the Lender
5.1 - Form of Officer's Certificate
5.4 - Form of Guarantee and Security Agreement
5.7 - Debentures
5.10 - Debt Outstanding After the Closing
6.4 - Litigation
6.5 - Legal Obstacles to Agreements
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NEXTERA ENTERPRISES, INC.
DISCRETIONARY DEMAND CREDIT AGREEMENT
This Agreement, dated as of June 25, 1999, is among Nextera
Enterprises, Inc., a Delaware corporation (the "COMPANY"), its Subsidiaries from
time to time party hereto and BankBoston, N.A. (the "LENDER"). The parties agree
as follows:
1. DEFINITIONS; CERTAIN RULES OF CONSTRUCTION. Except as the context
otherwise explicitly requires, (a) the capitalized term "Section" refers to
sections of this Agreement, (b) the capitalized term "Exhibit" refers to
exhibits to this Agreement, (c) references to "$" and "Dollars" are to United
States dollars, (d) the word "including" shall be construed as "including
without limitation", (e) accounting terms not otherwise defined herein have the
meaning provided under GAAP, (f) references to a particular statute or
regulation include all rules and regulations thereunder and any successor
statute, regulation or rule thereto, in each case as from time to time in
effect, and (g) references to a particular Person include such Person's
successors and assigns to the extent not prohibited by this Agreement and the
other Credit Documents. References to "the date hereof" mean the date first set
forth above.
"AGREEMENT" means this Discretionary Demand Credit Agreement as from
time to time in effect.
"APPLICABLE RATE" means the Base Rate; PROVIDED, HOWEVER, that an
additional 2% per annum shall be added to the Base Rate effective on the day the
Lender notifies the Company that the interest rates hereunder are increasing as
a result of the occurrence and continuance of a Default until such Default is no
longer continuing.
"BANKING DAY" means any day (other than Saturday or Sunday) on which
banks are open to conduct business in Boston, Massachusetts.
"BASE RATE" means, on any date, the greater of (a) the rate of interest
announced by the Lender as its Base Rate or (b) the sum of 2% PLUS the Federal
Funds Rate.
"CLOSING DATE" means the date on which any extension of credit is made
pursuant to Section 2.
"COMPANY" means Nextera Enterprises, Inc., a Delaware corporation.
"CREDIT DOCUMENTS" means:
(1) this Agreement, the Note, the Guarantee and Security
Agreement, the Subordination Agreement, each Letter of Credit, each
draft presented or accepted under a
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Letter of Credit and each application and agreement for a Letter of
Credit on the Lender's customary form, each as from time to time in
effect; and
(2) any other present or future agreement or instrument from
time to time entered into among the Lender, on one hand, and the
Company and any of its Subsidiaries, on the other hand, relating to,
amending or modifying this Agreement or any other Credit Document
referred to above or which is stated to be a Credit Document, each as
from time to time in effect.
"CREDIT OBLIGATIONS" means all present and future liabilities,
obligations and indebtedness of the Company or any of its Subsidiaries owing to
the Lender under or in connection with this Agreement or any other Credit
Document, including obligations in respect of principal, interest, reimbursement
obligations under Letters of Credit provided by the Lender, Letter of Credit
fees, amounts provided for in Section 3.2 and other fees, charges, indemnities
and expenses from time to time owing hereunder or under any other Credit
Document.
"DEFAULT" means any failure by the Company to make any payment in
respect of (a) interest on or in respect of any of the Credit Obligations owed
by the Company to the Lender as the same shall become due and payable or (b)
principal of any of the Credit Obligations owed by the Company to the Lender as
the same shall become due and payable, whether upon demand by the Lender or on
the Final Maturity Date.
"FEDERAL FUNDS RATE" means, for any day, the rate equal to the weighted
average (rounded upward to the nearest x%) of the rates on overnight federal
funds transactions with members of the Federal Reserve System arranged by
federal funds brokers, (a) as such weighted average is published for such day
(or, if such day is not a Banking Day, for the immediately preceding Banking
Day) by the Federal Reserve Bank of New York or (b) if such rate is not so
published for such Banking Day, quotations received by the Lender from three
federal funds brokers of recognized standing selected by the Lender. Each
determination by the Lender of the Federal Funds Rate shall, in the absence of
manifest error, be conclusive.
"FINAL MATURITY DATE" means January 5, 2000.
"GAAP" means generally accepted accounting principles as from time to
time in effect, including the statements and interpretations of the United
States Financial Accounting Standards Board, consistently followed.
"GUARANTEE AND SECURITY AGREEMENT" means the Guarantee and Security
Agreement to be entered into by and among the Lender and the Obligors in
substantially the form of EXHIBIT 5.4.
"INDEMNIFIED PARTY" is defined in Section 8.2.
"LENDER" means BankBoston, N.A.
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"LETTER OF CREDIT" means one or more irrevocable documentary or
standby letters of credit issued by the Lender for the account of the Company or
any of its Subsidiaries, subject to all the terms and conditions of this
Agreement and so long as no Default exists, from time to time on and after the
initial Closing Date and prior to the Final Maturity Date.
"LETTER OF CREDIT EXPOSURE" means, at any date, the sum of (a) the
aggregate face amount of all drafts that may then or thereafter be presented by
beneficiaries under all Letters of Credit then outstanding, PLUS (b) the
aggregate face amount of all drafts that the Lender has previously accepted
under Letters of Credit but has not paid.
"LOAN" means the aggregate principal amount of the loans outstanding
from time to time under Section 2.1.
"MARGIN STOCK" means "margin stock" within the meaning of Regulations
T, U or X of the Board of Governors of the Federal Reserve System.
"MATERIAL ADVERSE CHANGE" means a material adverse change in the
business, operations, assets, financial condition, income or prospects of the
Company and its Subsidiaries (on a consolidated basis).
"NOTE" means the form of demand note payable to the Lender in
substantially the form of EXHIBIT 2 evidencing the Company's obligations to pay
the Loan.
"OBLIGORS" means the Company and the Subsidiaries of the Company
party hereto from time to time.
"PAYMENT DATE" means the last Banking Day of each month.
"PERSON" means any present or future natural person or any
corporation, association, partnership, joint venture, limited liability company,
business trust, trust, organization, business, individual or government or any
governmental agency or political subdivision thereof.
"SUBSIDIARY" means any Person of which the Company (or other
specified Person) shall at the time, directly or indirectly through one or more
of its Subsidiaries, (a) own more than 50% of the outstanding capital stock (or
other shares of beneficial interest) entitled to vote generally, (b) hold more
than 50% of the partnership, joint venture or similar interests or (c) be a
general partner or joint venturer; PROVIDED, HOWEVER, that the term "Subsidiary"
shall not include Cranberry Hill Capital LLC.
"UNIFORM CUSTOMS AND PRACTICE" means the Uniform Customs and Practice
for Documentary Credits adopted by a Congress of the International Chamber of
Commerce, and any subsequent revisions thereof approved by a Congress of the
International Chamber of Commerce and adhered to by the Lender.
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2. THE CREDITS.
2.1. DISCRETIONARY REVOLVING CREDIT FACILITY.
2.1.1. DISCRETIONARY REVOLVING LOAN. Subject to all the terms
and conditions of this Agreement and AT THE LENDER'S SOLE AND ABSOLUTE
DISCRETION, from time to time on and after the initial Closing Date and
prior to the Final Maturity Date, the Lender may make loans to the
Company in such amounts as may be requested by the Company in
accordance with Section 2.2, or in such lesser amounts as the Lender
may elect in its sole and absolute discretion; PROVIDED, HOWEVER, that
on the initial Closing Date, the Lender will advance sufficient funds
to the Company to (a) fund the acquisition of The Economics Resource
Group, Inc., (b) advance up to $8,000,000 million for the repayment in
full of the Company's or its Subsidiaries' existing lines of credit and
(c) provide the Letters of Credit set forth on EXHIBIT 2.1.1, but in
any event not more than $30,000,000 in the aggregate. The sum of the
aggregate principal amount of loans made under this Section 2.1 at any
one time outstanding shall in no event exceed $30,000,000.
2.1.2. BORROWING REQUESTS. The Company may from time to time
request a loan under Section 2.1 by providing to the Lender a notice
(which may be given by a telephone call received by an authorized
representative of the Lender and promptly confirmed in writing). Such
notice must be received by the Lender no later than noon (Boston time)
on the requested Closing Date. The notice must specify the amount of
the requested revolving loan (which shall be not less than $100,000 and
an integral multiple of $1,000). If the Lender in its sole and absolute
discretion elects to make such loan, each such loan will be made by
depositing the amount thereof to the general account of the Company
with the Lender.
2.1.3. NOTE. The Lender shall keep a record of the Loan. The
Company's obligations to pay the Loan shall be evidenced by the Note.
2.2. LETTERS OF CREDIT.
2.2.1. ISSUANCE OF LETTERS OF CREDIT. Letters of Credit shall
be issued only for such lawful corporate purposes as the Company has
requested in writing and to which the Lender agrees. The sum of the
Letter of Credit Exposure PLUS the aggregate principal amount of loans
made under Section 2.1 at any one time outstanding shall in no event
exceed $30,000,000. Letter of Credit Exposure shall in no event exceed
$5,000,000.
2.2.2. REQUESTS FOR LETTERS OF CREDIT. The Company may from
time to time request a Letter of Credit to be issued by providing the
Lender a notice which is actually received not less than five Banking
Days (for standby Letters of Credit) and one Banking Day (for
documentary Letters of Credit) prior to the requested Closing Date for
such
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Letter of Credit specifying (a) the amount of the requested Letter of
Credit, (b) the beneficiary thereof, (c) the requested Closing Date and
(d) a summary of the principal terms of the text for such Letter of
Credit. Each Letter of Credit will be issued by forwarding it to the
Company or to such other Person as directed in writing by the Company.
In connection with the issuance of any Letter of Credit, the Company
shall furnish to the Lender a certificate in substantially the form of
EXHIBIT 5.1 and any customary application and agreement forms required
by the Lender (the current form of which is attached hereto as EXHIBIT
2.2.2). In the event of any inconsistency between such application and
agreement forms and this Agreement, this Agreement shall govern. Upon
each issuance of a Letter of Credit, the Company shall pay to the
Lender the fees contemplated by Section 3.3.
2.2.3. FORM AND EXPIRATION OF LETTERS OF CREDIT. Each Letter
of Credit issued under this Section 2.2 and each draft accepted or paid
under such a Letter of Credit shall be issued, accepted or paid, as the
case may be, by the Lender at its principal office. No Letter of Credit
shall provide for the payment of drafts drawn thereunder, and no draft
shall be payable, at a date which is later than the Final Maturity
Date. Each Letter of Credit and each draft accepted under a Letter of
Credit shall be in such form and minimum amount, and shall contain such
terms, as the Lender and the Company may agree upon at the time such
Letter of Credit is issued.
2.2.4. REIMBURSEMENT OF PAYMENT. At such time as the Lender
makes any payment on a draft presented or accepted under a Letter of
Credit, the amount of such payment shall be considered a Loan under
Section 2.1 (regardless of whether the conditions set forth in Section
5 are satisfied) as if the Company had paid in full the amount required
with respect to the Letter of Credit by borrowing such amount under
Section 2.1, except as provided below. In the event such amount would
cause the Loan to exceed $30,000,000 or in the event the Lender has
previously provided written notice to the Company that Letter of Credit
payments will no longer be considered a Loan under Section 2.1, the
Company will on demand pay to the Lender in immediately available funds
the amount of such payment.
2.2.5. UNIFORM CUSTOMS AND PRACTICE. The Uniform Customs and
Practice shall be binding on the Company and the Lender except to the
extent otherwise provided herein, in any Letter of Credit or in any
other Credit Document. Anything in the Uniform Customs and Practice to
the contrary notwithstanding:
a. Neither the Company nor any beneficiary of any Letter
of Credit shall be deemed an agent of the Lender.
b. With respect to each Letter of Credit, neither the
Lender nor its correspondents shall be responsible for or shall have
any duty to ascertain (unless the Lender or such correspondent is
grossly negligent or willful in failing so to ascertain):
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(1) the genuineness of any signature or the
validity, form, sufficiency, accuracy, genuineness or legal
effect of any endorsements;
(2) delay in giving, or failure to give, notice
of arrival, notice of refusal of documents or of discrepancies
in respect of which the Lender refuses the documents or any
other notice, demand or protest;
(3) the performance by any beneficiary under any
Letter of Credit of such beneficiary's obligations to the
Company;
(4) inaccuracy in any notice received by the
Lender;
(5) the validity, form, sufficiency, accuracy,
genuineness or legal effect of any instrument, draft,
certificate or other document required by such Letter of
Credit to be presented before payment of a draft if such
instrument, draft, certificate or other document appears on
its face to comply with the requirements of the Letter of
Credit, or the office held by or the authority of any Person
signing any of the same; or
(6) failure of any instrument to bear any
reference or adequate reference to such Letter of Credit, or
failure of any Person to note the amount of any instrument on
the reverse of such Letter of Credit or to surrender such
Letter of Credit or to forward documents in the manner
required by such Letter of Credit.
c. Except insofar as a particular Letter of Credit
contains express, contrary instructions, the Lender may honor as
complying with the terms of any Letter of Credit and with this
Agreement any drafts or other documents otherwise in order signed or
issued by an administrator, executor, conservator, trustee in
bankruptcy, debtor in possession, assignee for benefit of creditors,
liquidator, receiver or other legal representative of the party
authorized under such Letter of Credit to draw or issue such drafts or
other documents.
d. The occurrence of any of the events referred to in
the Uniform Customs and Practice or in the preceding clauses of this
Section 2.2.5 shall not affect or prevent the vesting of any of the
Lender's rights or powers hereunder or the Company's obligation to make
reimbursement of amounts paid under any Letter of Credit or any draft
accepted thereunder.
e. The Company will promptly examine (i) each Letter of
Credit (and any amendments thereof) sent to it by the Lender and (ii)
all instruments and documents delivered to it from time to time by the
Lender. The Company will notify the Lender of any claim of
noncompliance by notice actually received within one Banking Day after
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receipt of any of the foregoing documents, the Company being
conclusively deemed to have waived any such claim against the Lender
and its correspondents unless such notice is given.
f. In the event of any conflict between the provisions
of this Agreement and the Uniform Customs and Practice, the provisions
of this Agreement shall govern.
2.2.6. SUBROGATION. Upon any payment by the Lender under any
Letter of Credit and until the reimbursement of the Lender by the
Company with respect to such payment, the Lender shall be entitled to
be subrogated to, and to acquire and retain, the rights which the
Person to whom such payment is made may have against the Company, all
for the benefit of the Lender. The Company will take such action as the
Lender may reasonably request, including requiring the beneficiary of
any Letter of Credit to execute such documents as the Lender may
reasonably request, to assure and confirm to the Lender such
subrogation and such rights, including the rights, if any, of the
beneficiary to whom such payment is made in accounts receivable,
inventory and other properties and assets of any Obligor.
2.2.7. MODIFICATION, CONSENT, ETC. If the Company requests
or consents in writing to any modification or extension of any Letter
of Credit, or waives any failure of any draft, certificate or other
document to comply with the terms of such Letter of Credit, and if the
Lender consents thereto, the Lender shall be entitled to rely on such
request, consent or waiver. This Agreement shall be binding upon the
Company with respect to such Letter of Credit as so modified or
extended, and with respect to any action taken or omitted by the Lender
pursuant to any such request, consent or waiver.
3. INTEREST; FEES, ETC.
3.1. INTEREST. The Loan shall accrue and bear interest at a rate
per annum which shall at all times equal the Applicable Rate. The Company will
pay the accrued and unpaid interest on the Loan on the earliest of (a) DEMAND BY
THE LENDER, (b) each Payment Date and (c) and on any stated maturity of the
Loan.
3.2. CAPITAL ADEQUACY, ETC. If the Lender shall determine that
compliance by the Lender with any law, statute or regulation which is effective
or adopted after the date hereof regarding capital adequacy of banks or bank
holding companies has or would have the effect of reducing the rate of return on
the capital of the Lender and its affiliates as a consequence of the extensions
of credit contemplated hereby, or the Lender's maintenance of the extensions of
credit contemplated hereby, to a level below that which the Lender could have
achieved but for such compliance (taking into consideration the policies of the
Lender and its affiliates with respect to capital adequacy immediately before
such compliance and assuming that the capital of such Lender and its affiliates
was fully utilized prior to such compliance) by an amount deemed by such Lender
to be material, then such Lender may claim compensation from the Company.
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Within 30 days after the receipt by the Company of a certificate from
the Lender setting forth why it is claiming compensation under this Section 3.2
and computations (in reasonable detail) of the amount thereof, the Company shall
pay to the Lender such additional amounts as such Lender sets forth in such
certificate as sufficient fully to compensate it on account of the foregoing
provisions of this Section 3.2. The determination by the Lender of the amount to
be paid to it and the basis for computation thereof hereunder shall be
conclusive so long as (a) such determination is made in good faith, (b) no
manifest error appears therein, (c) the Lender uses reasonable averaging and
attribution methods and (d) the Lender generally requires such compensation from
other similarly situated borrowers from whom it has the right to require such
compensation.
3.3. LETTER OF CREDIT FEE. The Company shall, on the date of
issuance or any extension or renewal of any Letter of Credit and at such other
time or times as such charges are customarily made by the Lender, pay a fee to
the Lender (a) in respect of each standby Letter of Credit equal to the product
of 1.5% per annum, calculated on the basis of a year of 360 days and the actual
number of days elapsed, for the stated term of such standby Letter of Credit,
MULTIPLIED BY the face amount of such standby Letter of Credit and (b) in
respect of each documentary Letter of Credit, equal to the product of 1.5%
MULTIPLIED BY the face amount of such documentary Letter of Credit. The Company
will also pay to the Lender all customary fees for issuance, negotiation,
amendment or processing of the Letters of Credit.
3.4. COMPUTATIONS OF INTEREST. For purposes of this Agreement,
interest (and any amount expressed as interest) shall be computed on the basis
of a 365/366-day year.
4. PAYMENT.
4.1. PAYMENT UPON DEMAND OR AT MATURITY. The Company will pay to
the Lender an amount equal to the Loan, together with all accrued and unpaid
interest thereon and all other Credit Obligations then outstanding, upon the
earlier of (a) DEMAND BY THE LENDER or (b) the Final Maturity Date.
4.2. VOLUNTARY PREPAYMENTS OF LOAN. The Company may from time to
time prepay all or any portion of the Loan (in a minimum amount of $100,000 and
an integral multiple of $1,000), without penalty or premium.
4.3. REBORROWING. The amounts of the Loan prepaid may be
reborrowed, subject to the Lender's sole and absolute discretion, in accordance
with Section 2, subject to the limitations thereof.
5. CONDITIONS TO EXTENDING CREDIT. The Lender may extend credit hereunder
IN ITS SOLE AND ABSOLUTE DISCRETION, and in addition would expect satisfaction
of the following further conditions, on or before the Closing Date therefor:
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5.1. OFFICER'S CERTIFICATE. The representations and warranties
contained in Section 6 shall be true and correct on and as of the Closing Date
with the same force and effect as though originally made on and as of such date;
no Default shall exist on the Closing Date prior to or immediately after giving
effect to the requested extension of credit; as of the Closing Date, no Material
Adverse Change shall have occurred; and the Company shall have furnished to the
Lender on the Closing Date a certificate to these effects, in substantially the
form of EXHIBIT 5.1.
5.2. NOTE. On the initial Closing Date, the Company shall have
executed the Note and delivered it to the Lender.
5.3. LEGAL OPINION. On the initial Closing Date, the Lender shall
have received from Maron & Sandler, counsel for the Company, and Xxxxxx &
Xxxxxxx and Xxxxxxx, Xxxxx & Xxxxx LLP, special counsel for the Company, hereby
authorized and directed by the Company, their opinions with respect to the
transactions contemplated by the Credit Documents, which opinions shall be
reasonably satisfactory to the Lender.
5.4. GUARANTEE AND SECURITY AGREEMENT. The Obligors shall have duly
authorized, executed and delivered to the Lender the Guarantee and Security
Agreement.
5.5. PERFECTION OF SECURITY. The Obligors shall have duly
authorized, executed, acknowledged and delivered to the Lender for filing such
security agreements, notices, financing statements and other instruments as the
Lender may have reasonably requested in order to perfect the liens purported or
required pursuant to the Credit Documents to be created in the Credit Security
(as defined in the Guarantee and Security Agreement) and shall have paid all
filing or recording fees or taxes required to be paid in connection therewith,
including any recording, mortgage, documentary, transfer or intangible taxes.
5.6. FEES. On the initial Closing Date, the Company shall have paid
to the Lender (a) a transaction fee of $25,000 and (b) reasonable fees and
expenses of the Lender's counsel for which statements have been provided to the
Company on or prior to the initial Closing Date.
5.7. OTHER OUTSTANDING DEBT. As of the initial Closing Date, the
Company shall also have aggregate credit facility indebtedness (including
capitalized lease obligations) of no more than $15,000,000 PLUS no more than
$29,950,000 of the Company's debentures owing to affiliates of Knowledge
Enterprises, Inc., certain officers of the Company and an employee of the
Company, each of whom shall enter into a subordination agreement with the Lender
on terms satisfactory to the Lender, which debentures are set forth in EXHIBIT
5.7.
5.8. NO MATERIAL LITIGATION. No material adverse litigation and no
material litigation or other proceeding, the result of which could impair or
prevent the consummations of the transactions contemplated hereby, shall have
occurred.
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5.9. NO MATERIAL DEFAULT OF ANY MATERIAL CONTRACT. No material
default of any material contact of the Company or any of its Subsidiaries shall
have occurred.
5.10. REPAYMENT OF OUTSTANDING DEBT. As of the initial Closing Date,
the Company shall have repaid, or contemporaneously upon the receipt of any
initial Loan by the Lender to the Company will repay, any existing outstanding
debt, except as set forth on EXHIBIT 5.10.
5.11. RELEASE OF CERTAIN SECURITY INTERESTS. As of the initial
Closing Date, each of Nextera Funding, Inc. and the holders of the Company's
debentures set forth on EXHIBIT 5.7, shall have released all security interests
or other liens granted by the Company and its Subsidiaries to secure
indebtedness and other obligations owing to such parties, and such security
interests or liens shall be of no further force or effect.
5.12. MINIMUM EBITDA. The sum of (a) pro forma adjusted consolidated
net income of the Company and its Subsidiaries for the four-quarter period ended
March 31, 1999 AND (b) the amount deducted in calculating such pro forma
adjusted consolidated net income in respect of interest expense, income taxes,
depreciation and amortization shall exceed $20,000,000.
5.13. OTHER LENDER CONFIRMATION. The Lender shall have received
confirmation from each of the lenders identified in part A of EXHIBIT 6.5 either
that (i) the execution, delivery and performance of each of the Credit Documents
by the Obligors will not result in a breach of or a default under such lenders'
respective credit facilities extended to one or more of the Obligors or (ii)
that each such credit facility shall be terminated as of the initial Closing
Date.
5.14. PROPER PROCEEDINGS. This Agreement, each other Credit Document
and the transactions contemplated hereby and thereby shall have been authorized
by all necessary corporate proceedings of the Obligors. All necessary consents,
approvals and authorizations of any governmental or administrative agency or any
other Person of any of the transactions contemplated hereby or by any other
Credit Document shall have been obtained and shall be in full force and effect.
5.15. LEGALITY, ETC. The making of the requested extension of credit
shall not (a) subject the Lender to any penalty or special tax or (b) be
prohibited by any law or governmental order or regulation applicable to the
Lender.
5.16. GENERAL. All instruments and legal and corporate proceedings,
in connection with the transactions contemplated by this Agreement and each
other Credit Document, shall be satisfactory in form and substance to the
Lender, and the Lender shall have received copies of all documents, including
records of corporate proceedings, which the Lender may have reasonably requested
in connection therewith, such documents where appropriate to be certified by
proper corporate or governmental authorities.
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6. REPRESENTATIONS AND WARRANTIES. In order to induce the Lender to extend
credit to the Company hereunder, the Company and the other Obligors party
hereto, represent and warrant that:
6.1. ORGANIZATION AND BUSINESS.
6.1.1. THE COMPANY. The Company is a duly organized and
validly existing corporation, in good standing under the laws of the
State of Delaware, with all power and authority necessary to (a) enter
into and perform this Agreement and each other Credit Document to which
it is party and (b) own its properties and carry on the business now
conducted or proposed to be conducted by it. The Company has taken all
corporate action required to execute, deliver and perform this
Agreement and each other Credit Document to which it is party. Copies
of the charter and by-laws of the Company have been previously
delivered to the Lender and are correct and complete.
6.1.2. SUBSIDIARIES. Each Subsidiary of the Company is a
duly organized and validly existing corporation or limited liability
company, in good standing under the laws of the jurisdiction in which
it is organized, with all power and authority necessary to (a) enter
into and perform the Guarantee and Security Agreement and each other
Credit Document to which it is party and (b) own its properties and
carry on the business now conducted or proposed to be conducted by it.
Each Subsidiary has taken all corporate or limited liability company
action required to execute, deliver and perform each Credit Document to
which it is a party.
6.2. FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company has
previously furnished to the Lender copies of (a) the consolidated balance sheets
of the Company as of December 31 in 1998 and 1997, and the related consolidated
statements of operations, of stockholders' equity and of cash flows for the
fiscal years of the Company then ended, accompanied by the review of the
Company's accountants and (b) the consolidated balance sheet of the Company as
of March 31, 1999 and the related statements of operations and of cash flows for
the fiscal quarter and portion of the fiscal year then ended. The financial
statements (including the notes thereto) referred to in the preceding sentence
have been prepared in accordance with GAAP and fairly present in all material
respects the financial condition of the Persons covered thereby at the dates
thereof and the results of their operations for the periods covered thereby,
subject to the case of interim statements only to normal year-end audit
adjustments and the addition of footnotes.
6.3. CHANGES IN CONDITION. No Material Adverse Change has occurred
since December 31, 1998.
6.4. LITIGATION. Except as set forth in EXHIBIT 6.4, no litigation,
at law or in equity, or any proceeding before any federal, state, provincial or
municipal court, board or other governmental or administrative agency or any
arbitrator is pending or to the knowledge of the
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Company threatened which may reasonably involve any material risk of any final
judgment or liability not adequately covered by insurance or which is otherwise
reasonably likely to result in any Material Adverse Change. Other than as
disclosed in the financial statements, no judgment, decree or order of any
federal, state, provincial or municipal court, board or other governmental or
administrative agency or arbitrator has been issued against the Company which
has resulted, or is reasonably likely to result, in any Material Adverse Change.
6.5. NO LEGAL OBSTACLE TO AGREEMENTS. Except as set forth in
EXHIBIT 6.5, neither the execution and delivery of this Agreement or any other
Credit Document, nor the making of any borrowings hereunder, nor the
consummation of any transaction referred to in or contemplated by this Agreement
or any other Credit Document, nor the fulfillment of the terms hereof or thereof
or of any other agreement, instrument, deed or lease referred to in this
Agreement or any other Credit Document, has constituted or resulted in or will
constitute or result in:
(1) any breach or termination of the provisions of any
agreement, instrument, deed or lease which is material to the Company
and its Subsidiaries, taken as a whole, or which would have a material
adverse effect on the rights of the Lender hereunder, to which the
Company or any of its Subsidiaries is a party or by which it is bound,
or of the charter or by-laws of the Company or any of its Subsidiaries;
(2) the violation of any law, statute, judgment, decree
or governmental order, rule or regulation applicable to the Company or
any of its Subsidiaries;
(3) the creation under any agreement, instrument, deed or
lease of any lien (other than liens securing the Credit Obligations)
upon any of the assets of the Company or any of its Subsidiaries; or
(4) any redemption, retirement or other repurchase
obligation of the Company under any charter, by-law, agreement,
instrument, deed or lease.
No approval, authorization or other action by, or declaration to or filing with,
any governmental or administrative authority or any other Person is required to
be obtained or made by the Company or any of its Subsidiaries in connection with
the execution, delivery and performance of this Agreement or any other Credit
Document, the transactions contemplated hereby or thereby or the making of any
borrowing by the Company hereunder.
6.6. TAXES. The Company has filed (or obtained extensions to file)
required tax returns and paid taxes due except such taxes as are being contested
in good faith and as to which adequate reserves have been set aside in
conformity with GAAP.
7. CERTAIN ACTIONS FOLLOWING A DEFAULT. If a Default shall occur and be
continuing, then in each and every such case:
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7.1. EXERCISE OF RIGHTS. The Lender shall proceed to protect and
enforce its rights by suit in equity, action at law and/or other appropriate
proceeding, either for specific performance of any covenant or condition
contained in this Agreement or any other Credit Document.
7.2. SETOFF. The Lender may offset and apply toward the payment of
such balance or part thereof (and/or toward the curing of any Default) any
indebtedness from the Lender to the Company or any other Obligor, including any
indebtedness represented by deposits in any account maintained with the Lender,
regardless of the adequacy of any security for the Credit Obligations, and the
Lender shall have no duty to determine the adequacy of any such security in
connection with any such offset.
7.3. CUMULATIVE REMEDIES. To the extent not prohibited by
applicable law which cannot be waived, all of the Lender's rights hereunder and
under each other Credit Document shall be cumulative.
8. EXPENSE; INDEMNITY.
8.1. EXPENSES. The Company will pay: (a) all reasonable expenses of
the Lender (including the reasonable fees and disbursements of the special
counsel to the Lender) in connection with the preparation of this Agreement, the
transactions contemplated hereby and operations hereunder; (b) all transfer and
documentary stamp and similar taxes at any time payable in respect of this
Agreement or the Loan; and (c) all other reasonable expenses incurred by the
Lender in connection with the enforcement of any rights hereunder or under any
other Credit Document upon the occurrence and during the continuance of a
Default, including costs of collection and reasonable attorneys' fees and
expenses.
8.2. GENERAL INDEMNITY. The Company shall indemnify the Lender and
each of the Lender's directors, officers, employees, agents, attorneys,
accountants, consultants and each Person, if any, who controls the Lender (each
Lender and each of such directors, officers, employees, agents, attorneys,
accountants, consultants and control Persons is referred to as an "INDEMNIFIED
PARTY") and hold each of them harmless from and against any and all claims,
damages, liabilities and reasonable expenses (including reasonable fees and
disbursements of counsel with whom any Indemnified Party may consult in
connection therewith and all reasonable expenses of litigation or preparation
therefor) which any Indemnified Party may incur or which may be asserted against
any Indemnified Party in connection with (a) the Indemnified Party's compliance
with or contest of any subpoena or other process issued against it in any
proceeding involving the Company or any of its Subsidiaries or their affiliates,
(b) any litigation or investigation involving the Company, any of its
Subsidiaries or their affiliates, or any officer, director or employee thereof,
(c) the existence or exercise of any security rights with respect to the
collateral under the Credit Documents or (d) this Agreement, any other Credit
Document or any transaction contemplated hereby or thereby; PROVIDED, HOWEVER,
that the foregoing indemnity shall not apply to litigation commenced by the
Company against the Lender which seeks enforcement of any of the rights of the
Company hereunder or under any other Credit Document
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and is determined adversely to the Lender in a final nonappealable judgment or
to the extent such claims, damages, liabilities and expenses result from the
Indemnified Party's own gross negligence or willful misconduct.
9. SUCCESSORS AND ASSIGNS; AGENT. Any reference in this Agreement to any
of the parties hereto shall be deemed to include the successors and assigns of
such party, and all covenants and agreements by or on behalf of the Company or
the Lender that are contained in this Agreement shall bind and inure to the
benefit of their respective successors and assigns; PROVIDED, HOWEVER, that the
Company may not assign its rights or obligations under this Agreement under any
circumstances and the Lender may assign its rights or obligations under this
Agreement only as follows: The Lender may from time to time grant participations
in the Loan and Note, or assign all or part of the Loan and Note, upon such
terms as the Lender may determine, to affiliates of the Lender or, with the
consent of the Company which shall not be unreasonably withheld, to other banks
or financial institutions. The Lender shall act as collateral agent for itself
and any other lenders who may from time to time become party hereto.
10. NOTICES. Except as otherwise specified in this Agreement, any notice
required to be given pursuant to this Agreement shall be given in writing. Any
notice, demand or other communication in connection with this Agreement shall be
deemed to be given if given in writing (including telex, telecopy (confirmed by
telephone or writing) or similar teletransmission) addressed as provided below
(or to the addressee at such other address as the addressee shall have specified
by notice actually received by the addressor), and if either (a) actually
delivered in fully legible form to such address (evidenced in the case of a
telex by receipt of the correct answer back) or (b) in the case of a letter,
five days shall have elapsed after the same shall have been deposited in the
United States mails, with first-class postage prepaid and registered or
certified.
If to the Company, to it at the following address:
Nextera Enterprises, Inc.
Xxx Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
Attention: Chief Financial Officer
If to the Lender, to it at the following address:
BankBoston, N.A.
000 Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Information Technology Division
11. COURSE OF DEALING, AMENDMENTS AND WAIVERS. No course of dealing between
the Lender and the Company or any affiliate of the Company shall operate as a
waiver of any of the Lender's
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19
rights under this Agreement or any other Credit Document or with respect to the
Credit Obligations. No delay or omission on the part of the Lender in exercising
any right under this Agreement or any other Credit Document or with respect to
the Credit Obligations shall operate as a waiver of such right or any other
right hereunder or thereunder. A waiver on any one occasion shall not be
construed as a bar to or waiver of any right or remedy on any future occasion.
No waiver, consent or amendment with respect to this Agreement or any other
Credit Document shall be binding unless it is in writing and signed by the
Lender.
12. WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY APPLICABLE LAW
THAT CANNOT BE WAIVED, EACH OF THE OBLIGORS AND THE LENDER WAIVES, AND COVENANTS
THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE), ANY
RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE, CLAIM OR PROCEEDING
ARISING OUT OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR THE SUBJECT MATTER
HEREOF OR THEREOF OR ANY CREDIT OBLIGATION OR IN ANY WAY CONNECTED WITH THE
DEALINGS OF THE LENDER OR THE OBLIGORS IN CONNECTION WITH ANY OF THE ABOVE, IN
EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING AND WHETHER IN CONTRACT,
TORT OR OTHERWISE. Either the Lender or the Obligors may file an original
counterpart or a copy of this Agreement with any court as written evidence of
the consent of the Obligors and the Lender to the waiver of their rights to
trial by jury.
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13. VENUE; SERVICE OF PROCESS; CERTAIN WAIVERS. Each of the Obligors and
the Lender:
(1) Irrevocably submits to the nonexclusive jurisdiction
of the state courts of The Commonwealth of Massachusetts and to the
nonexclusive jurisdiction of the United States District Court for the
District of Massachusetts for the purpose of any suit, action or other
proceeding arising out of or based upon this Agreement or any other
Credit Document or the subject matter hereof or thereof;
(2) Waives to the extent not prohibited by applicable law
that cannot be waived, and agrees not to assert, by way of motion, as a
defense or otherwise, in any such proceeding brought in any of the
above-named courts, any claim that it is not subject personally to the
jurisdiction of such court, that its property is exempt or immune from
attachment or execution, that such proceeding is brought in an
inconvenient forum, that the venue of such proceeding is improper, or
that this Agreement or any other Credit Document, or the subject matter
hereof or thereof, may not be enforced in or by such court;
(3) Consents to service of process in any such proceeding
in any manner at the time permitted by Chapter 223A of the General Laws
of The Commonwealth of Massachusetts and agrees that service of process
by registered or certified mail, return receipt requested, at its
address specified in or pursuant to Section 10 is reasonably calculated
to give actual notice; and
(4) Waives to the extent not prohibited by applicable law
that cannot be waived any right it may have to claim or recover in any
such proceeding any special, exemplary, punitive or consequential
damages.
14. GENERAL. All covenants, agreements, representations and warranties made
in this Agreement or any other Credit Document or in certificates delivered
pursuant hereto or thereto shall be deemed to have been material and relied on
by the Lender, notwithstanding any investigation made by the Lender, and shall
survive the execution and delivery to the Lender hereof and thereof. The
invalidity or unenforceability of any provision hereof shall not affect the
validity or enforceability of any other provision hereof, and any invalid or
unenforceable provision shall be modified so as to be enforced to the maximum
extent of its validity or enforceability. The headings in this Agreement are for
convenience of reference only and shall not limit, alter or otherwise affect the
meaning hereof. This Agreement and the other Credit Documents constitute the
entire understanding of the parties with respect to the subject matter hereof
and thereof and supersede all prior and current understandings and agreements,
whether written or oral. This Agreement may be executed in any number of
counterparts which together shall constitute one instrument. This Agreement
shall be governed by and construed in accordance with the laws (other than the
conflict of laws rules) of The Commonwealth of Massachusetts.
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Each of the undersigned has caused this Agreement to be executed and
delivered by its duly authorized officer as an agreement under seal as of the
date first above written.
NEXTERA ENTERPRISES, INC.
By:
----------------------------------------
Name:
Title:
BANKBOSTON, N.A.
By:
----------------------------------------
Name:
Title:
CRITIAS, INC.
ERG ACQUISITION CORP.
LEXECON INC.
NEONEXT LLC
NEXTERA BUSINESS PERFORMANCE SOLUTIONS
GROUP, INC.
THE PLANNING TECHNOLOGIES GROUP, L.L.C.
PYRAMID IMAGING, INC.
SCANADA, INC.
SIBSON & COMPANY, LLC
SIBSON INTERNATIONAL, LLC
TIMAEUS, INC.
By:
----------------------------------------
As an authorized officer of each of the
foregoing corporations or limited
liability companies
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