Exhibit 10-u
CREDIT AGREEMENT
BETWEEN
KLT TELECOM INC.,
AS LENDER,
AND
DIGITAL TELEPORT, INC.,
AS BORROWER
DATED AS OF FEBRUARY 21, 2001
DIGITAL TELEPORT, INC.
CREDIT AGREEMENT
This CREDIT AGREEMENT, dated as of February 21, 2001, is
AMONG DIGITAL TELEPORT, INC. (the "Borrower") and KLT TELECOM
INC. (the "Lender"). The parties hereto agree as follows:
WHEREAS, the Borrower wishes to obtain, and the Lender is
willing to make, certain revolving credit loans on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the undertakings set
forth herein and other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Acquisition" means any transaction, or any series of
related transactions, consummated on or after the date of this
Agreement, by which the Borrower or any of its Subsidiaries (i)
acquires any going business or all or substantially all of the
assets of any firm, corporation or division thereof, whether
through purchase of assets, merger or otherwise or (ii) directly
or indirectly acquires (in one transaction or as the most recent
transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have
ordinary voting power for the election of directors (other than
securities having such power only by reason of the happening of a
contingency) or a majority (by percentage or voting power) of the
outstanding partnership interests of a partnership.
"Advance" means a borrowing hereunder by the Borrower.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control
with such Person. A Person shall be deemed to control another
Person if the controlling Person owns 10% or more of any class of
voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power
to direct or cause the direction of the management or policies of
the controlled Person, whether through ownership of stock, by
contract or otherwise.
"Agreement" means this Credit Agreement, as it may be
amended or modified and in effect from time to time.
"Article" means an article of this Agreement unless another
document is specifically referenced.
"Authorized Officer" means any officer of the Borrower,
acting singly.
"Borrower" means Digital Teleport, Inc., a Missouri
corporation, and its successors and assigns.
"Borrowing Date" means a date on which an Advance is made
hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing,
payment or rate selection of Eurodollar Advances, a day (other
than a Saturday or Sunday) on which banks generally are open in
Kansas City, Missouri, for the conduct of substantially all of
their commercial lending activities and on which dealings in
United States dollars are carried on in the London interbank
market and (ii) for all other purposes, a day (other than a
Saturday or Sunday) on which banks generally are open in Kansas
City, Missouri, for the conduct of substantially all of their
commercial lending activities.
"Capitalized Lease" of a Person means any lease of Property
by such Person as lessee which would be capitalized on a balance
sheet of such Person prepared in accordance with Agreement
Accounting Principles.
"Capitalized Lease Obligations" of a Person means the amount
of the obligations of such Person under Capitalized Leases which
would be shown as a liability on a balance sheet of such Person
prepared in accordance with Agreement Accounting Principles.
"Code" means the Internal Revenue Code of 1986, as amended,
reformed or otherwise modified from time to time.
"Commitment" means the obligation of the Lender to make
Loans not exceeding Twenty Five Million Dollars ($25,000,000.00)
in aggregate principal amount at any time outstanding.
"Condemnation" is defined in Section 7.8.
"Contingent Obligation" of a Person means any agreement,
undertaking or arrangement by which such Person assumes,
guarantees, endorses, contingently agrees to purchase or provide
funds for the payment of, or otherwise becomes or is contingently
liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other
financial condition of any other Person, or otherwise assures any
creditor of such other Person
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against loss, including, without limitation, any comfort letter,
operating agreement or take-or-pay contract, or application for a
letter of credit or similar instrument by such Person or upon
which such Person is an account party or for which such Person is
in any way liable.
"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. For purposes of this definition, Controlled Group
shall be determined immediately prior to the time Borrower became
a member of the Kansas City Power & Light Company controlled
group.
"Default" means an event described in Article VII.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any rule or regulation
issued thereunder.
"Facility Termination Date" means the earlier of June 30,
2002, or the date on which Lender makes demand for payment
pursuant to the Note.
"Indebtedness" of a Person means such Person's (i)
obligations for borrowed money, (ii) obligations representing the
deferred purchase price of Property or services (other than
accounts payable arising in the ordinary course of such Person's
business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by Liens or payable
out of the proceeds or production from property now or hereafter
owned or acquired by such Person, (iv) obligations which are
evidenced by notes, acceptances, or other instruments, (v)
Capitalized Lease Obligations, (vi) Rate Hedging Obligations, and
(vii) Contingent Obligations.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees
made in the ordinary course of business), extension of credit
(other than accounts receivable arising in the ordinary course of
business on terms customary in the trade), deposit account or
contribution of capital by such Person to any other Person or any
investment in, or purchase or other acquisition of, the stock,
partnership interests, notes, debentures or other securities or
other indebtedness of any other Person made by such Person.
"Lender" means KLT Telecom Inc., a Missouri corporation, and
its successors and assigns.
"Lien" means any lien (statutory or other), security
interest, mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance or preference, priority or other
security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of
a vendor or lessor under any conditional sale, Capitalized Lease
or other title retention agreement).
"Loan Documents" means this Agreement and the Note.
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"Material Adverse Effect" means a material adverse effect on
(i) the business, Property, condition (financial or otherwise),
results of operations, or prospects of the Borrower takenas a
whole, (ii) the ability of the Borrower to perform its
obligations under the Loan Documents, or (iii) the validity or
enforceability of any of the Loan Documents or the rights or
remedies of the Lender thereunder.
"Multiemployer Plan" means a Plan maintained pursuant to a
collective bargaining agreement or any other arrangement to which
the Borrower or any member of the Controlled Group is a party to
which more than one employer is obligated to make contributions.
"Non-Recourse Debt" means Indebtedness which is incurred in
connection with the financing by the Borrower of the acquisition
or construction of an asset and (a) is collateralized by the
grant by the Borrower of a security interest in such asset and
(b) for which recourse for non-payment of any such Indebtedness
is limited solely to recourse to such asset (and other Property
specifically related thereto, such as permits, books, records,
and contracts) and not to any other assets of the Borrower.
"Note" means a demand promissory note, in substantially the
form of Exhibit "A" hereto, duly executed by the Borrower and
payable to the order of the Lender in the amount of the
Commitment, including any amendment, modification, renewal or
replacement of such demand promissory note.
"Obligations" means all unpaid principal of and accrued and
unpaid interest on the Note, and all accrued and unpaid fees and
all expenses, reimbursements, indemnities and other obligations
of the Borrower to the Lender arising under the Loan Documents.
"PBGC" means the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Person" means any natural person, corporation, firm, joint
venture, partnership, association, enterprise, trust or other
entity or organization, or any government or political
subdivision or any agency, department or instrumentality thereof.
"Plan" means an 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 as to which the Borrower
or any member of the Controlled Group may have any liability.
"Property" of a Person means any and all property, whether
real, personal, tangible, intangible, or mixed, of such Person,
or other assets owned, leased or operated by such Person.
"Rate Hedging Obligations" of a Person means any and all
obligations of such Person, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and
substitutions therefor), under (i) any and all agreements,
devices or arrangements designed to protect at least
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one of the parties thereto from the fluctuations of interest
rates, exchange rates or forward rates applicable to such party's
assets, liabilities or exchange transactions, including, but not
limited to, dollar-denominated or cross-currency interest rate
exchange agreements, forward currency exchange agreements,
interest rate cap or collar protection agreements, forward rate
currency or interest rate options, puts and warrants, and (ii)
any and all cancellations, buy backs, reversals, terminations or
assignments of any of the foregoing.
"Reportable Event" means a reportable event as defined in
Section 4043 of ERISA and the regulations issued under such
section, with respect to a Plan, excluding, however, such events
as to which the PBGC by regulation waived the requirement of
Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure
to meet the minimum funding standard of Section 412 of the Code
and of Section 302 of ERISA shall be a Reportable Event
regardless of the issuance of any such waiver of the notice
requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.
"Section" means a numbered section of this Agreement, unless
another document is specifically referenced.
"Single Employer Plan" means a Plan maintained by the
Borrower or any member of the Controlled Group for employees of
the Borrower or any member of the Controlled Group.
"Subsidiary" of a Person means (i) any corporation more than
50% of the outstanding securities having ordinary voting power of
which shall at the time be owned or controlled, directly or
indirectly, by such Person or by one or more of its Subsidiaries
or by such Person and one or more of its Subsidiaries, or (ii)
any partnership, association, joint venture or similar business
organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or
controlled. Unless otherwise expressly provided, all references
herein to a "Subsidiary" shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of
the Borrower, Property which (i) represents more than 10% of the
consolidated assets of the Borrower as would be shown in the
consolidated financial statements of the Borrower as at the
beginning of the twelve-month period ending with the month in
which such determination is made, or (ii) is responsible for more
than 10% of the consolidated net sales or of the consolidated net
income of the Borrower as reflected in the financial statements
referred to in clause (i) above.
"Unfunded Liabilities" means the amount (if any) by which
the present value of all vested nonforfeitable benefits under all
Single Employer Plans exceeds the fair market value of all such
Plan assets allocable to such benefits, all determined as of the
then most recent valuation date for such Plans.
"Unmatured Default" means an event which but for the lapse
of time or the giving of notice, or both, would constitute a
Default.
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"Wholly-Owned Subsidiary" of a Person means (i) any
Subsidiary all of the outstanding voting securities of which
shall at the time be owned or controlled, directly or indirectly,
by such Person or one or more Wholly-Owned Subsidiaries of such
Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership,
association, joint venture or similar business organization 100%
of the ownership interests having ordinary voting power of which
shall at the time be so owned or controlled.
The foregoing definitions shall be equally applicable to
both the singular and plural forms of the defined terms.
ARTICLE II
THE CREDITS
2.1. COMMITMENT. From and including the date of this
Agreement and prior to the Facility Termination Date, the Lender
agrees, on the terms and conditions set forth in this Agreement,
to make Advances to the Borrower from time to time in amounts not
to exceed in the aggregate at any one time outstanding the amount
of the Commitment, at the request of and for the account of the
Borrower from time to time before the Facility Termination Date.
Subject to the terms of this Agreement, the Borrower may borrow,
repay and reborrow at any time prior to the Facility Termination
Date. The Commitment shall expire on the Facility Termination
Date.
2.2. REQUIRED PAYMENTS; TERMINATION. The entire unpaid
principal balance of the Note shall be immediately due and
payable UPON DEMAND by Lender, and Borrower acknowledges that any
condition or requirement set forth in the Agreement or in any
other agreement between Borrower and Lender is not the only basis
upon which demand can be made hereunder.
2.3. MINIMUM AMOUNT OF EACH ADVANCE. Each Advance shall be
in the minimum amount of $1,000,000 (and in multiples of $500,000
if in excess thereof) or, if less, the amount of the unused
Commitment.
2.4. OPTIONAL PRINCIPAL PAYMENTS. The Borrower may from
time to time pay, without penalty or premium, all outstanding
Advances, or, in a minimum aggregate amount of $1,000,000 or any
integral multiple of $500,000 in excess thereof, any portion of
the outstanding Advances upon two Business Days' prior notice to
the Lender.
2.5. INTEREST RATE. Each Advance shall bear interest on the
outstanding principal amount thereof, for each day from and
including the date such Advance is made at a rate per annum equal
to 9.5%, calculated on the basis of a 360 day year. Interest
shall be payable for the day an Advance is made but not for the
day of any payment on the amount paid if payment is received
prior to noon (local time) at the place of payment. If any
payment of principal of or
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interest on an Advance shall become due on a day which is not a
Business Day, such payment shall be made on the next succeeding
Business Day and, in the case of a principal payment, such
extension of time shall be included in computing interest in
connection with such payment.
2.6. RATE APPLICABLE AFTER DEFAULT. Notwithstanding
anything to the contrary contained in Section 2.5, during the
continuance of a Default or Unmatured Default all outstanding
Advances shall bear interest on the outstanding principal amounts
thereof for each day from and including the date such Default or
Unmatured Default occurred at a rate per annum equal to 12.5%,
calculated on the basis of a 360 day year.
2.7. METHOD OF PAYMENT. All payments of the Obligations
hereunder shall be made, without setoff, deduction, counterclaim,
or withholding, in immediately available funds to the Lender at
the Lender's address specified pursuant to Article VIII, by noon
(local time) on the date when due.
2.8. NOTES; TELEPHONIC NOTICES. The Lender is hereby
authorized to record the principal amount of each of its Advances
and each repayment on the schedule attached to the Note,
provided, however, that the failure to so record shall not affect
the Borrower's obligations under such Note. The Borrower hereby
authorizes the Lender to extend Advances and to transfer funds
based on telephonic notices made by any person or persons the
Lender in good faith believes to be acting on behalf of the
Borrower. The Borrower agrees to deliver promptly to the Lender
a written confirmation, if such confirmation is requested by the
Lender, of each telephonic notice signed by an Authorized
Officer. If the written confirmation differs in any material
respect from the action taken by the Lender, the records of the
Lender shall govern absent manifest error.
ARTICLE III
CONDITIONS PRECEDENT
3.1. CONDITIONS PRECEDENT TO EFFECTIVENESS. This
Agreement shall become effective on the date on which the
Borrower has paid to the Lenders all fees, costs and expenses due
and payable pursuant to Section 8.7 (to the extent then billed)
and the Borrower has furnished to the Lender:
(i) Copies of the articles of incorporation of the
Borrower, together with all amendments, and a
certificate of good standing, both certified by the
appropriate governmental officer in its jurisdiction of
incorporation.
(ii) Copies, certified by the Secretary or Assistant
Secretary of the Borrower, of its by-laws and of its
Board of Directors' resolutions (and resolutions of
other bodies, if any are deemed necessary by counsel
for any Lender) authorizing the execution of the Loan
Documents.
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(iii) An incumbency certificate, executed by the
Secretary or Assistant Secretary of the Borrower, which
shall identify by name and title and bear the signature
of the officers of the Borrower authorized to sign the
Loan Documents and to make borrowings hereunder, upon
which certificate the Agent and the Lenders shall be
entitled to rely until informed of any change in
writing by the Borrower.
(iv) A certificate, signed by the President, or Vice
President and Chief Financial Officer of the Borrower,
stating that on the effective date no Default or
Unmatured Default has occurred and is continuing.
(v) The Note duly executed by the Borrower.
(vi) Written money transfer instructions addressed to the
Lender and signed by an Authorized Officer, together
with such other related money transfer authorizations
as the Lender may have reasonably requested.
(vii) The insurance certificate described in Section
4.15.
(viii) Such other documents as any Lender or its counsel may
have reasonably requested, including without limitation, legal
opinions, applicable governmental and other approvals,
certificates of existence, lien/bankruptcy/judgment searches, all
in acceptable form and substance to Lender.
(ix) The most current financial statements regarding Borrower
available prior to the effective date, and certified financial
statements annually thereafter. The financial statements
provided shall be audited if available, but in any event shall be
prepared in accordance with generally accepted accounting
principles.
3.2. EACH ADVANCE. The Lender shall not be required to
make any Advance (other than an Advance that, after giving effect
thereto and to the application of the proceeds thereof, does not
increase the aggregate amount of outstanding Advances), unless on
the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article
IV are true and correct as of such Borrowing Date,
except to the extent any such representation or
warranty is stated to relate solely to an earlier date,
in which case such representation or warranty shall be
true and correct on and as of such earlier date.
(iii) All legal matters incident to the making of such
Advance shall be satisfactory to the Lenders and their
counsel.
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Each Borrowing Notice with respect to each such Advance
shall constitute a representation and warranty by the Borrower
that the conditions contained in Sections 3.2(i) and (ii) have
been satisfied. The Lender may require a duly completed
compliance certificate in substantially the form of Exhibit 3.2
hereto as a condition to making an Advance.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders that:
4.1. CORPORATE EXISTENCE AND STANDING. The Borrower is
a corporation duly incorporated or organized, validly existing
and in good standing under the laws of its jurisdiction of
incorporation or organization and has all requisite authority to
conduct its business in each jurisdiction in which its business
is conducted.
4.2. AUTHORIZATION AND VALIDITY. The Borrower has the
corporate power and authority and legal right to execute and
deliver the Loan Documents and to perform its obligations
thereunder. The execution and delivery by the Borrower of the
Loan Documents and the performance of its obligations thereunder
have been duly authorized by proper corporate proceedings, and
the Loan Documents constitute legal, valid and binding
obligations of the Borrower enforceable against the Borrower in
accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally.
4.3. NO CONFLICT; GOVERNMENT CONSENT. Neither the
execution and delivery by the Borrower of the Loan Documents, nor
the consummation of the transactions therein contemplated, nor
compliance with the provisions thereof will violate any law,
rule, regulation, order, writ, judgment, injunction, decree or
award binding on the Borrower or the Borrower's articles of
incorporation or by-laws or the provisions of any indenture,
instrument or agreement to which the Borrower is a party or is
subject, or by which it, or its Property, is bound, or conflict
with or constitute a default thereunder, or result in the
creation or imposition of any Lien in, of or on the Property of
the Borrower pursuant to the terms of any such indenture,
instrument or agreement. No order, consent, approval, license,
authorization, or validation of, or filing, recording or
registration with, or exemption by, any governmental or public
body or authority, or any subdivision thereof, is required to
authorize, or is required in connection with the execution,
delivery and performance of, or the legality, validity, binding
effect or enforceability of, any of the Loan Documents.
4.4. FINANCIAL STATEMENTS. The December 31, 2000
financial statements of the Borrower heretofore delivered to the
Lender were prepared in accordance with generally accepted
accounting principles and fairly present the consolidated
financial condition and operations of the Borrower at such date
and the consolidated results of their operations for the period
then ended.
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4.5. MATERIAL ADVERSE CHANGE. Since February 1, 2001,
there has been no change in the business, Property, prospects,
condition (financial or otherwise) or results of operations of
the Borrower which could reasonably be expected to have a
Material Adverse Effect.
4.6. TAXES. The Borrower has filed all United States
federal tax returns and all other tax returns which are required
to be filed and have paid all taxes due pursuant to said returns
or pursuant to any assessment received by the Borrower, except
such taxes, if any, as are being contested in good faith and as
to which adequate reserves have been provided. No tax liens have
been filed and no claims are being asserted with respect to any
such taxes. The charges, accruals and reserves on the books of
the Borrower in respect of any taxes or other governmental
charges are adequate.
4.7. LITIGATION AND CONTINGENT OBLIGATIONS. There is
no litigation, arbitration, governmental investigation,
proceeding or inquiry pending or, to the knowledge of any of
their officers, threatened against or affecting the Borrower
which could reasonably be expected to have a Material Adverse
Effect. As of the date of each Advance, the Borrower has no
Contingent Obligations other than those allowed under Section
5.10.
4.8. ERISA. The Unfunded Liabilities of all Single
Employer Plans do not in the aggregate exceed $100,000. Neither
the Borrower nor any other member of the Controlled Group has
incurred, or is reasonably expected to incur, any withdrawal
liability to Multiemployer Plans in excess of $100,000 in the
aggregate. Each Plan complies in all material respects with all
applicable requirements of law and regulations, no Reportable
Event has occurred with respect to any Plan, neither the Borrower
nor any other members of the Controlled Group has withdrawn from
any Plan or initiated steps to do so, and no steps have been
taken to reorganize or terminate any Plan.
4.9. ACCURACY OF INFORMATION. No information, exhibit or
report furnished by the Borrower to the Lender in connection with
the negotiation of, or compliance with, the Loan Documents
contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements
contained therein not misleading.
4.10. MATERIAL AGREEMENTS. The Borrower is not in
default in the performance, observance or fulfillment of any of
the obligations, covenants or conditions contained in any
agreement or instrument evidencing or governing Indebtedness,
which default could reasonably be expected to have a Material
Adverse Effect.
4.11. COMPLIANCE WITH LAWS. The Borrower has complied
with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any
instrumentality or agency thereof, having jurisdiction over the
conduct of its business or the ownership of its Property, the
failure to comply with which could reasonably be expected to have
a Material Adverse Effect. The Borrower has not received any
notice to the effect that its operations are not in material
compliance with any of the requirements of applicable federal,
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state and local environmental, health and safety statutes and
regulations or the subject of any federal or state investigation
evaluating whether any remedial action is needed to respond to a
release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could
reasonably be expected to have a Material Adverse Effect.
4.12. OWNERSHIP OF PROPERTIES. On the date of this
Agreement, the Borrower will have good title, free of all Liens
other than those permitted by Section 5.16, to all of the
Property and assets reflected in the financial statements as
owned by it.
4.13. INVESTMENT COMPANY ACT. The Borrower is not an
"investment company" within the meaning of the Investment Company
Act of 1940, as amended.
4.15. INSURANCE. The certificate signed by the
President or Chief Financial Officer of the Borrower, that
attests to the existence and adequacy of, and summarizes, the
property and casualty insurance program carried by the Borrower
and that has been furnished by the Borrower to the Lender, is
complete and accurate. This summary includes the insurer's or
insurers' name(s), policy number(s), expiration date(s),
amount(s) of coverage, type(s) of coverage, exclusion(s), and
deductibles. This summary also includes similar information, and
describes any reserves, relating to any self-insurance program
that is in effect.
ARTICLE V
COVENANTS
During the term of this Agreement, unless the Lender shall
otherwise consent in writing:
5.1. FINANCIAL REPORTING. The Borrower will maintain
for itself a system of accounting established and administered in
accordance with generally accepted accounting principles, and
furnish to the Lender:
(i) Within 90 days after the close of each of its fiscal
years, an audit report certified by independent
certified public accountants, acceptable to the Lender,
prepared in accordance with generally accepted
accounting principles for itself, including balance
sheets as of the end of such period, related profit and
loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by (a) any
management letter prepared by said accountants, and (b)
a certificate of said accountants that, in the course
of their examination necessary for their certification
of the foregoing, they have obtained no knowledge of
any Default or Unmatured Default, or if, in the opinion
of such accountants, any Default or Unmatured Default
shall exist, stating the nature and status thereof.
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(ii) Within 45 days after the close of the first three
quarterly periods of each of its fiscal years,
unaudited balance sheets as at the close of each such
period and profit and loss and reconciliation of
surplus statements and a statement of cash flows for
the period from the beginning of such fiscal year to
the end of such quarter, all certified by its President
or the Chief Financial Officer.
(iii) As soon as available, but in any event within 60
days after the beginning of each fiscal year of the
Borrower, a copy of the plan and forecast (including a
projected consolidated and consolidating balance sheet,
income statement and funds flow statement and updated
projections) of the Borrower for such fiscal year.
(iv) Together with the financial statements required
hereunder, a compliance certificate in substantially
the form of Exhibit 3.2 hereto signed by its President
or the Chief Financial Officer stating that no Default
or Unmatured Default exists, or if any Default or
Unmatured Default exists, stating the nature and status
thereof.
(v) Within 270 days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single
Employer Plan, certified as correct by an actuary
enrolled under ERISA.
(vi) As soon as possible and in any event within 10 days
after the Borrower knows that any Reportable Event has
occurred with respect to any Plan, a statement, signed
by the President or the Chief Financial Officer of the
Borrower, describing said Reportable Event and the
action which the Borrower proposes to take with respect
thereto.
(vii) As soon as possible and in any event within 10
days after receipt by the Borrower, a copy of (a) any
notice or claim to the effect that the Borrower is or
may be liable to any Person as a result of the release
by the Borrower or any other Person of any toxic or
hazardous waste or substance into the environment, and
(b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or
regulation by the Borrower, which, in either case,
could reasonably be expected to have a Material Adverse
Effect.
(viii) Promptly upon the filing thereof, copies of all
registration statements and annual, quarterly, monthly
or other regular reports which the Borrower files with
the Securities and Exchange Commission.
(ix) Such other information (including non-financial
information) as the Lender may from time to time
reasonably request.
5.2. USE OF PROCEEDS. The Borrower will, and will cause
each Subsidiary to, use the proceeds of the Advances for working
capital and general corporate purposes. The Borrower will
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not use any identifiable portion of the proceeds of the Advances
to purchase or carry any "margin stock" (as defined in Regulation
U) or to make any other Acquisition.
5.3. NOTICE OF DEFAULT. The Borrower will give prompt
notice in writing to the Lenders of the occurrence of any Default
or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material
Adverse Effect.
5.4. CONDUCT OF BUSINESS. The Borrower will carry on
and conduct its business in substantially the same manner and in
substantially the same fields of enterprise as it is presently
conducted and to do all things necessary to remain duly
incorporated, validly existing and in good standing as a domestic
corporation in its jurisdiction of incorporation and maintain all
requisite authority to conduct its business in each jurisdiction
in which its business is conducted.
5.5. TAXES. The Borrower will pay when due all taxes,
assessments and governmental charges and levies upon it or its
income, profits or Property, except those which are being
contested in good faith by appropriate proceedings and with
respect to which adequate reserves have been set aside.
5.6. INSURANCE. The Borrower will maintain with
financially sound and reputable insurance companies insurance on
all their Property in such amounts and covering such risks as is
consistent with sound business practice, and the Borrower will
furnish to Lender upon request full information as to the
insurance carried.
5.7. COMPLIANCE WITH LAWS. The Borrower will comply
with all laws, rules, regulations, orders, writs, judgments,
injunctions, decrees or awards to which it may be subject, the
failure to comply with which could reasonably be expected to have
a Material Adverse Effect.
5.8. MAINTENANCE OF PROPERTIES. The Borrower will do
all things necessary to maintain, preserve, protect and keep its
Property in good repair, working order and condition, and make
all necessary and proper repairs, renewals and replacements so
that its business carried on in connection therewith may be
properly conducted at all times.
5.9. INSPECTION. The Borrower will permit the Lender,
by its representatives and agents, to inspect any of the
Property, corporate books and financial records of the Borrower,
to examine and make copies of the books of accounts and other
financial records of the Borrower, and to discuss the affairs,
finances and accounts of the Borrower with, and to be advised as
to the same by, their respective officers at such reasonable
times and intervals as the Lender may designate.
5.10. INDEBTEDNESS. The Borrower will not create, incur
or suffer to exist any Indebtedness, except:
(i) The Advances.
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(ii) Indebtedness existing on the date hereof.
(iii) Non-Recourse Debt.
(iv) Other Indebtedness as approved in advance by the
Lender.
5.11. MERGER. The Borrower will not merge or consolidate
with or into any other Person.
5.12. SALE OF ASSETS. The Borrower will not lease, sell
or otherwise dispose of its Property, to any other Person except
for (i) sales of inventory in the ordinary course of business,
(ii) at all times that no Default or Unmatured Default has
occurred and is continuing, leases, sales or other dispositions
of its Property that, together with all other Property of the
Borrower previously leased, sold or disposed of (other than
inventory in the ordinary course of business) as permitted by
this clause (ii) during the twelve-month period ending with the
month in which any such lease, sale or other disposition occurs,
do not constitute a Substantial Portion of the Property of the
Borrower.
5.13. SALE OF ACCOUNTS. The Borrower will not sell or
otherwise dispose of any notes receivable or accounts receivable,
with or without recourse.
5.14. SALE AND LEASEBACK. The Borrower will not sell or
transfer any of its Property in order to concurrently or
subsequently lease as lessee such or similar Property.
5.15. INVESTMENTS AND ACQUISITIONS. The Borrower will
not make or suffer to exist any Investments (other than loans and
advances to, and other Investments in, Subsidiaries), or
commitments therefor, or to make any Acquisition of any Person,
except:
(i) Short-term obligations of, or fully guaranteed by, the
United States of America or any agency or
instrumentality thereof, or any money market mutual
fund that invests substantially all of its assets in
such short-term obligations.
(ii) Commercial paper rated A-l or better by Standard and
Poor's Ratings Group or P-l or better by Xxxxx'x
Investors Service, Inc.
(iii) Demand deposit accounts maintained in the ordinary
course of business.
(iv) Certificates of deposit issued by and time deposits
with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000
and a long-term debt rating of A or better by Standard
and Poor's Ratings Group or Xxxxx'x Investors Service,
Inc.
(v) Investments in existence on the date hereof.
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5.16. LIENS. The Borrower will not create, incur, or
suffer to exist any Lien in, of or on the Property of the
Borrower, except:
(i) Liens for taxes, assessments or governmental charges or
levies on its Property if the same shall not at the
time be delinquent or thereafter can be paid without
penalty, or are being contested in good faith and by
appropriate proceedings and for which adequate reserves
in accordance with generally accepted principles of
accounting shall have been set aside on its books.
(ii) Liens imposed by law, such as carriers', warehousemen's
and mechanics' liens and other similar liens arising in
the ordinary course of business which secure payment of
obligations not more than 60 days past due or which are
being contested in good faith by appropriate
proceedings and for which adequate reserves in
accordance with generally accepted principles of
accounting shall have been set aside on its books.
(iii) Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old
age pensions, or other social security or retirement
benefits, or similar legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of
a nature generally existing with respect to properties
of a similar character and which do not in any material
way affect the marketability of the same or interfere
with the use thereof in the business of the Borrower or
the Subsidiaries.
(v) Liens existing on the date hereof.
(vi) Judgment Liens which secure payment of legal
obligations that would not otherwise constitute a
Default under Section 6.9.
(vii) Liens securing Non-Recourse Debt otherwise
permitted under the terms of this Agreement.
(viii) Liens on Property in existence at the time of
acquisition of such Property by the Borrower.
(ix) Deposits to secure the performance of bids, trade
contracts (other than for borrowed money), leases,
statutory obligations, surety and appeal bonds,
performance bonds, and other obligations of a like
nature incurred in the ordinary course of business by
the Borrower or any Subsidiary.
(x) Liens created by the Loan Documents.
15
5.17. AFFILIATES. The Borrower will not enter into any
transaction (including, without limitation, the purchase or sale
of any Property or service) with, or make any payment or transfer
to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's
business and upon fair and reasonable terms no less favorable to
the Borrower than the Borrower would obtain in a comparable
arms-length transaction.
ARTICLE VI
DEFAULTS
The occurrence of any one or more of the following events
shall constitute a Default:
6.1. Any representation or warranty made or deemed made
by or on behalf of the Borrower to the Lender under or in
connection with this Agreement, any Advance, or any certificate
or information delivered in connection with this Agreement or any
other Loan Document shall be materially false on the date as of
which made.
6.2. Nonpayment of principal of the Note when due, or
nonpayment of interest on the Note or other obligations under any
of the Loan Documents within five days after the same becomes
due.
6.3. The breach by the Borrower of any of the terms or
provisions of Section 5.2, 5.10, 5.11, 5.12, 5.14, 5.15, 5.16 or
5.17.
6.4. The breach by the Borrower (other than a breach
which constitutes a Default under Section 5.1, 5.2 or 5.3) of any
of the terms or provisions of this Agreement which is not
remedied within five days after written notice from the Lender.
6.5. Failure of the Borrower to pay any Indebtedness
when due; or the default by the Borrower in the performance of
any term, provision or condition contained in any agreement under
which any Indebtedness was created or is governed, or any other
event shall occur or condition exist, the effect of which is to
cause, or to permit the holder or holders of such Indebtedness to
cause, such Indebtedness to become due prior to its stated
maturity; or any Indebtedness of the Borrower shall be declared
to be due and payable or required to be prepaid (other than by a
regularly scheduled payment) prior to the stated maturity
thereof; or the Borrower shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
6.6. The Borrower shall (i) have an order for relief
entered with respect to it under the Federal bankruptcy laws as
now or hereafter in effect, (ii) make an assignment for the
benefit of creditors, (iii) apply for, seek, consent to, or
acquiesce in, the appointment of a receiver, custodian, trustee,
examiner, liquidator or similar official for it or any
Substantial Portion of its
16
Property, (iv) institute any proceeding seeking an order for
relief under the Federal bankruptcy laws as now or hereafter in
effect or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization,
arrangement, adjustment or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or
relief of debtors or fail to file an answer or other pleading
denying the material allegations of any such proceeding filed
against it, (v) take any corporate action to authorize or effect
any of the foregoing actions set forth in this Section 6.6 or
(vi) fail to contest in good faith any appointment or proceeding
described in Section 6.7.
6.7. Without the application, approval or consent of
the Borrower, a receiver, trustee, examiner, liquidator or
similar official shall be appointed for the Borrower or any
Substantial Portion of its respective Property, or a proceeding
described in Section 6.6(iv) shall be instituted against the
Borrower and such appointment continues undischarged or such
proceeding continues undismissed or unstayed for a period of 30
consecutive days.
6.8. Any court, government or governmental agency shall
condemn, seize or otherwise appropriate, or take custody or
control of (each a "Condemnation"), all or any portion of the
Property of the Borrower which, when taken together with all
other Property of the Borrower seized, appropriated, or taken
custody or control of, during the twelve-month period ending with
the month in which any such Condemnation occurs, constitutes a
Substantial Portion.
6.9. The Borrower shall fail within 30 days to pay,
bond or otherwise discharge any judgment or order for the payment
of money in excess of $100,000, which is not stayed on appeal or
otherwise being appropriately contested in good faith.
6.10. The Unfunded Liabilities of all Single Employer
Plans shall exceed in the aggregate $100,000 or any Reportable
Event shall occur in connection with any Plan.
6.11. The Borrower or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer
Plan that it has incurred withdrawal liability to such
Multiemployer Plan in an amount which, when aggregated with all
other amounts required to be paid to Multiemployer Plans by the
Borrower or any other member of the Controlled Group as
withdrawal liability (determined as of the date of such
notification), exceeds $100,000.
6.12. The Borrower or any other member of the Controlled
Group shall have been notified by the sponsor of a Multiemployer
Plan that such Multiemployer Plan is in reorganization or is
being terminated, within the meaning of Title IV of ERISA, if as
a result of such reorganization or termination the aggregate
annual contributions of the Borrower and the other members of the
Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or
will be increased over the amounts contributed to such
Multiemployer Plans for the respective plan years of each such
Multiemployer Plan immediately preceding the plan year in which
the reorganization or termination occurs by an amount exceeding
$100,000.
17
6.13. The Borrower shall be the subject of any
proceeding or investigation pertaining to the release by the
Borrower or any other Person of any toxic or hazardous waste or
substance into the environment, or any violation of any federal,
state or local environmental, health or safety law or regulation,
which, in either case, could reasonably be expected to have a
Material Adverse Effect.
ARTICLE VII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
7.1. ACCELERATION. If any Default described in Section
6.6 or 6.7 occurs with respect to the Borrower, the obligations
of the Lender to make Advances hereunder shall automatically
terminate and the Obligations shall immediately become due and
payable without any election or action on the part of the Lender.
If any other Default occurs, the Lender may terminate or suspend
the obligations of the Lender to make Advances hereunder, or
declare the Obligations to be due and payable, or both, whereupon
the Obligations shall become immediately due and payable, without
presentment, demand, protest or notice of any kind, all of which
the Borrower hereby expressly waives. Notwithstanding the
foregoing, Borrower may make demand for payment of the
Obligations at any time and for any or no reason.
7.2. AMENDMENTS. Subject to the provisions of this
Article VII, the Lender and the Borrower may enter into
agreements supplemental hereto for the purpose of adding or
modifying any provisions to the Loan Documents or changing in any
manner the rights of the Lender or the Borrower hereunder or
waiving any Default hereunder.
7.3. PRESERVATION OF RIGHTS. No delay or omission of
the Lender to exercise any right under the Loan Documents shall
impair such right or be construed to be a waiver of any Default
or an acquiescence therein, and the making of an Advance
notwithstanding the existence of a Default or the inability of
the Borrower to satisfy the conditions precedent to such Advance
shall not constitute any waiver or acquiescence. Any single or
partial exercise of any such right shall not preclude other or
further exercise thereof or the exercise of any other right, and
no waiver, amendment or other variation of the terms, conditions
or provisions of the Loan Documents whatsoever shall be valid
unless in contained in a writing signed by the Lender, and then
only to the extent set forth in such writing. All remedies
contained in the Loan Documents or afforded by law shall be
cumulative and all shall be available to the Lender until the
Obligations have been paid in full.
18
ARTICLE VIII
GENERAL PROVISIONS
8.1. SURVIVAL OF REPRESENTATIONS. All representations
and warranties of the Borrower contained in this Agreement shall
survive delivery of the Note and the making of the Advances
herein contemplated.
8.2. GOVERNMENTAL REGULATION. Anything contained in this
Agreement to the contrary notwithstanding, the Lender shall not
be obligated to extend credit to the Borrower in violation of any
limitation or prohibition provided by any applicable statute or
regulation.
8.3. TAXES. Any taxes (excluding federal income taxes
on the overall net income of the Lender) or other similar
assessments or charges made by any governmental or revenue
authority in respect of the Loan Documents shall be paid by the
Borrower, together with interest and penalties, if any, other
than interest and penalties to the extent the accrual of which is
attributable to the gross negligence or willful misconduct of the
Lender.
8.4. HEADINGS. Section headings in the Loan Documents
are for convenience of reference only, and shall not govern the
interpretation of any of the provisions of the Loan Documents.
8.5. ENTIRE AGREEMENT. The Loan Documents embody the
entire agreement and understanding among the Borrower and the
Lender and supersede all prior agreements and understandings
among the Borrower and the Lenders relating to the subject matter
thereof.
8.6. BENEFITS OF THIS AGREEMENT. This Agreement shall
not be construed so as to confer any right or benefit upon any
Person other than the parties to this Agreement and their
respective successors and assigns.
8.7. EXPENSES; INDEMNIFICATION. The Borrower shall
reimburse the Lender for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time
charges of attorneys for the Lender, which attorneys may be
employees of the Lender) paid or incurred by the Lender in
connection with the preparation, negotiation, execution,
delivery, review, amendment, modification, and administration of
the Loan Documents. The Borrower also agrees to reimburse the
Lender for any costs, internal charges and out-of-pocket expenses
(including attorneys' fees and time charges of attorneys for the
Lender, which attorneys may be employees of the Lender) paid or
incurred by the Lender in connection with the collection and
enforcement of the Loan Documents. The Borrower further agrees
to indemnify the Lender, its directors, officers and employees
against all losses, claims, damages, penalties, judgments,
liabilities and expenses (including, without limitation, all
expenses of litigation or preparation therefor whether or not the
Lender is a party thereto) which any of them may pay or incur
arising out of or relating to this Agreement, the other Loan
Documents, the transactions contemplated hereby or the direct or
indirect application or proposed application of the proceeds of
any Advance hereunder except to the extent such obligations arise
from the gross negligence or willful misconduct of the
19
Lender. The obligations of the Borrower under this Section shall
survive the termination of this Agreement.
8.8. ACCOUNTING. Except as provided to the contrary
herein, all accounting terms used herein shall be interpreted and
all accounting determinations hereunder shall be made in
accordance with generally accepted accounting principles.
20
8.9. SEVERABILITY OF PROVISIONS. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or
invalid in any jurisdiction shall, as to that jurisdiction, be
inoperative, unenforceable, or invalid without affecting the
remaining provisions in that jurisdiction or the operation,
enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan
Documents are declared to be severable.
8.10. CHOICE OF LAW. THE TRANSACTION DOCUMENTS (OTHER
THAN THOSE CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION)
SHALL BE CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS (AND NOT
THE LAW OF CONFLICTS) OF THE STATE OF MISSOURI.
8.11. CONSENT TO JURISDICTION. THE BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
UNITED STATES FEDERAL OR MISSOURI STATE COURT SITTING IN KANSAS
CITY, MISSOURI, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO ANY TRANSACTION DOCUMENTS AND THE BORROWER HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH COURT AND
IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS
TO THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN
SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE LENDER TO BRING
PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER
JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST
THE LENDER OR ANY AFFILIATE OF THE LENDER INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR
CONNECTED WITH ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT
IN KANSAS CITY, MISSOURI.
8.12. WAIVER OF JURY TRIAL AND CERTAIN DAMAGE CLAIMS.
THE BORROWER AND LENDER HEREBY WAIVE TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER
(WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY WAY
ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT
OR THE RELATIONSHIP ESTABLISHED THEREUNDER. THE BORROWER AND
LENDER HEREBY WAIVE ALL RIGHT TO CLAIM OR RECOVER IN ANY ACTION
OR PROCEEDING ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL
DAMAGES, OR DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES.
8.13. SUCCESSORS AND ASSIGNS. The terms and provisions
of the Loan Documents shall be binding upon and inure to the
benefit of the Borrower and the Lender and their respective
successors and assigns, except that the Borrower shall not have
the right to assign its rights or obligations under the Loan
Documents.
21
8.14. GIVING NOTICE. Except as otherwise permitted by
Section 2.8 with respect to borrowing notices, all notices and
other communications provided to any party hereto under this
Agreement or any other Loan Document shall be in writing or by
telex or by facsimile and addressed or delivered to such party at
its address set forth below its signature hereto or at such other
address as may be designated by such party in a notice to the
other parties. Any notice, if mailed and properly addressed with
postage prepaid, shall be deemed given when received; any notice,
if transmitted by telex or facsimile, shall be deemed given when
transmitted (answerback confirmed in the case of telexes).
8.15. CHANGE OF ADDRESS. The Borrower and Lender may
each change the address for service of notice upon it by a notice
in writing to the other parties hereto.
22
8.16 COUNTERPARTS; EFFECTIVENESS. This Agreement may be
executed in any number of counterparts, all of which taken
together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such
counterpart. This Agreement shall be effective when it has been
executed by the Borrower and the Lender and each party has
notified the other by facsimile or telephone, that it has taken
such action.
8.17 ACKNOWLEDGMENTS. THE BORROWER HEREBY REPRESENTS,
WARRANTS, ACKNOWLEDGES AND ADMITS THAT (A) IT HAS BEEN ADVISED BY
COUNSEL ON THE NEGOTIATION, EXECUTION AND DELIVERY OF THIS
AGREEMENT, THE LOAN DOCUMENTS AND ANY OTHER INSTRUMENT OR
DOCUMENT ENTERED INTO IN CONNECTION HEREWITH, (B) IT HAS MADE AN
INDEPENDENT DECISION TO ENTER INTO THIS AGREEMENT, THE LOAN
DOCUMENTS AND SUCH OTHER INSTRUMENTS AND DOCUMENTS, WITHOUT
RELIANCE ON ANY REPRESENTATION, WARRANTY, COVENANT OR UNDERTAKING
BY THE LENDER, WHETHER WRITTEN, ORAL OR IMPLICIT, OTHER THAN AS
EXPRESSLY SET FORTH IN THIS AGREEMENT, (C) THE LENDER HAS NOT
MADE ANY REPRESENTATION, COVENANT OR UNDERTAKING TO THE BORROWER
IN CONNECTION WITH THE RIGHTS AND OBLIGATIONS OF THE BORROWER
PURSUANT TO THIS AGREEMENT, THE LOAN DOCUMENTS OR ANY SUCH
INSTRUMENTS AND DOCUMENTS, (D) THERE ARE NO REPRESENTATIONS,
WARRANTIES, COVENANTS OR UNDERTAKINGS OR AGREEMENTS BY THE LENDER
AS TO THIS AGREEMENT, THE LOAN DOCUMENTS OR SUCH INSTRUMENTS AND
DOCUMENTS EXCEPT AS EXPRESSLY SET FORTH IN WRITING HEREIN OR
THEREIN, (E) THE RELATIONSHIP BETWEEN THE BORROWER AND THE LENDER
, PURSUANT TO THIS AGREEMENT, THE LOAN DOCUMENTS AND SUCH
INSTRUMENTS AND DOCUMENTS, IS AND SHALL BE SOLELY THAT OF DEBTOR
AND CREDITOR, RESPECTIVELY, (F) NO JOINT VENTURE EXISTS BETWEEN
THE LENDER AND THE BORROWER, (G) WITHOUT LIMITING ANY OF THE
FOREGOING, THE BORROWER IS NOT RELYING UPON ANY REPRESENTATION BY
THE LENDER, OR ANY REPRESENTATIVE THEREOF, AND NO SUCH
REPRESENTATION HAS BEEN MADE, THAT THE LENDER WILL AT THE TIME OF
A DEFAULT OR UNMATURED DEFAULT OR AT ANY OTHER TIME, WAIVE,
NEGOTIATE, DISCUSS OR REFRAIN FROM TAKING ANY ACTION WITH RESPECT
TO ANY SUCH DEFAULT OR UNMATURED DEFAULT OR ANY OTHER TERM OF
THIS AGREEMENT OR SUCH INSTRUMENTS OR DOCUMENTS, AND (H) THE
LENDER HAS RELIED UPON THE TRUTHFULNESS OF THE FOREGOING
ACKNOWLEDGMENTS AND OF THE STATEMENTS CONTAINED IN THE DOCUMENTS
DELIVERED BY BORROWER REFERRED TO IN SECTION 3.1 IN DECIDING TO
EXECUTE AND DELIVER THIS AGREEMENT AND TO ACCEPT THE NOTE.
8.18 NO ORAL AGREEMENTS; ENTIRE AGREEMENT. ORAL AGREEMENTS
OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM
ENFORCING REPAYMENT OF A DEBT, INCLUDING PROMISES TO EXTEND OR
RENEW SUCH DEBT, ARE NOT ENFORCEABLE. TO PROTECT YOU (THE
BORROWER,) AND US (THE LENDER) FROM MISUNDERSTANDING OR
DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE
CONTAINED IN THIS WRITING (AND THE LOAN DOCUMENTS), WHICH IS THE
COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US,
EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.
ARTICLE IX
23
SECURITY
9.1 GRANT OF SECURITY INTEREST. To the extent permitted by
law, regulation or the provisions of any relevant agreement,
Borrower hereby grants to Lender (i) a security interest in and
to the collateral identified on EXHIBIT 9.1, attached hereto and
made a part hereof (the "Collateral"), and (ii) a lien upon all
of the Borrower's real property interests, as security for the
full and timely payment and performance by Borrower of the
Obligations. Upon request by the Lender, Borrower shall take
commercially reasonable efforts to seek all necessary consents,
authorizations or waivers required by law, regulation or
agreement to permit Lender's security interest to attach to any
and all portions of the Collateral. Nothing in this Article IX
shall be construed as creating a security interest in any portion
of the Collateral which is prohibited by law or regulation, or
which would constitute a breach of any agreement between the
Lender and a third party.
9.2 PERFECTION. Borrower shall execute and deliver to
Lender, or file or cause to be filed, such documents and
instruments as Lender shall request from time to time to further
evidence, perfect, protect or preserve Lender's rights hereunder
and with respect to the Collateral and real property interests,
including without limitation mortgages, deeds of trust or
financing statements under the Uniform Commercial Code.
[signature page follows]
24
IN WITNESS WHEREOF, the Borrower and the Lender have
executed this Agreement as of the date first above written.
DIGITAL TELEPORT, INC.
By: /s/Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
Title: Interim CEO
0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xx. Xxxxx, XX 00000
Telecopier:
KLT TELECOM INC.
By: /s/Xxxx X. Xxxxxxxxx
Name: Xxxx X. Xxxxxxxxx
Title: VP
00000 Xxxx, Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Telecopier: (000) 000-0000
25
