29780/105543
BOS-48253v3
CREDIT AGREEMENT
among
FLEET NATIONAL BANK,
BOSTON BEER COMPANY LIMITED PARTNERSHIP
and
THE BOSTON BEER COMPANY, INC.
Dated as of March 21, 1997
TABLE OF CONTENTS
Section Page
1 - DESCRIPTION OF CREDIT 1
1.1 The Loans 1
1.2 The Notes 2
1.3 Interest; Default Rate 2
1.4 Notice and Manner of Borrowing or Conversion of Loans 2
1.5 Prepayments 3
1.6 Fees 3
1.7 Capital Requirements 3
1.8 Method of Payment 3
1.9 Computation of Interest and Fees 3
1.10 Use of Proceeds 3
2 - CONDITIONS OF LOANS 4
2.1 Conditions Precedent to Initial Loan 4
2.2 Conditions Precedent to all Loans 4
3 - REPRESENTATIONS AND WARRANTIES 4
3.1 Organization and Qualification 4
3.2 Authority 5
3.3 Consents; Validity 5
3.4 Title to Properties; Absence of Encumbrances 5
3.5 Financial Statements 5
3.6 Taxes 6
3.7 Litigation 6
3.8 Compliance with Laws and Agreements 6
3.9 No Insolvency 6
3.10 Full Disclosure 6
3.11 Margin Stock 7
3.12 Patents, Trademarks, Etc. 7
3.13 ERISA 7
3.14 Environmental Laws 7
3.15 Ownership 8
4 - AFFIRMATIVE COVENANTS 9
4.1 Financial Reporting 9
4.2 Conduct of Business 10
4.3 Maintenance and Insurance 10
4.4 Taxes and Accounts Payable 10
4.5 Maintenance of Books and Records 10
4.6 Environmental Laws 11
4.7 Further Assurances 11
4.8 Principal Depository 11
Section Page
5 - FINANCIAL COVENANTS 11
5.1 Covenants 11
5.2 Definitions 11
6 - NEGATIVE COVENANTS 12
6.1 Indebtedness, Guarantees 12
6.2 Encumbrances 13
6.3 Sale and Leaseback 13
6.4 Merger; Consolidation; Disposition of Assets, Etc. 14
6.5 Investments 14
6.6 Transactions with Affiliates 14
6.7 Distributions 14
7 - DEFAULTS 14
7.1 Events of Default 14
7.2 Remedies 16
8 - GENERAL PROVISIONS 16
8.1 Notices 16
8.2 Expenses 17
8.3 Set-Off 17
8.4 No Waivers; Term 17
8.5 Governing Law 17
8.6 Amendments 17
8.7 Binding Effect of Agreement 17
8.8 Entire Agreement 18
8.9 Counterparts, Etc. 18
8.10 Waiver of Jury Trial 18
8.11 Consent to Jurisdiction 18
8.12 Indemnification 18
SCHEDULES
Schedule A General Defined Terms
Schedule B Libor Terms
Schedule CRepresentations and Warranties
EXHIBITS
Exhibit 1.2(a)Form of Revolving Credit Note
Exhibit 1.2(b)Form of Revolving Credit and Term Note
Exhibit 1.4 Notice of Borrowing or Conversion
Exhibit 2.1 Closing Agenda
Exhibit 3.7 Litigation
Exhibit 3.14Environmental Matters
Exhibit 3.15 Ownership
Exhibit 4.1 Form of Officer's Compliance Report
CREDIT AGREEMENT
THIS AGREEMENT is made as of March 21, 1997 by and among
BOSTON BEER COMPANY LIMITED PARTNERSHIP, a Massachusetts limited
partnership (the "Partnership") and THE BOSTON BEER COMPANY, INC.
(the "Corporation") (collectively, the "Borrowers" and
individually, a "Borrower"); and FLEET NATIONAL BANK, a national
banking association (the "Bank"). Capitalized terms used herein
are defined in Section 5 and Schedules A and B hereto.
A. The Partnership and Fleet Bank of Massachusetts, N.A.,
predecessor in interest to the Bank, are parties to a Revolving
Credit Agreement dated as of May 2, 1995, as amended (the
"Original Agreement"), pursuant to which the Partnership issued
its Revolving Note (the "Original Revolving Note") to evidence a
revolving line of credit (the "Existing Line of Credit") in the
principal amount of $14,000,000, $-0- of which is outstanding.
B. The Borrowers desire to increase their Existing Line of
Credit to $15,000,000 and desire to establish an additional
revolving line of credit in the amount of $30,000,000 which would
convert to a term loan on the Conversion Date, as provided
herein.
C. The Bank is willing to provide such additional funds to
the Borrowers hereunder, subject to the terms and conditions set
forth herein. This Agreement amends and restates the Original
Agreement.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein contained, the parties hereto hereby
agree as follows:
1. DESCRIPTION OF CREDIT.
1.1 The Loans.
(a) Subject to the terms and conditions of this Agreement,
the Bank will make loans (the "Revolving Loans A") jointly to the
Borrowers from time to time until the close of business on March
31, 1999 (the "Expiration Date"), in such sums as the Borrowers
may request; provided, however, the aggregate principal amount of
Revolving Loans A at any time outstanding hereunder shall not
exceed $15,000,000 (the "Revolver A Commitment"). The Borrowers
may borrow, prepay and reborrow from the date hereof to the
Expiration Date, the full amount of the Revolver A Commitment or
any lesser sum; provided that Libor Loans shall be in an amount
of at least $100,000 and an integral multiple of $100,000. All
of the outstanding principal on the Revolving Loans A shall be
due and payable in full on the Expiration Date.
(b) Subject to the terms and conditions of this Agreement,
the Bank will make loans (the "Revolving Loans") jointly to the
Borrowers from time to time until the close of business on March
31, 1999 (the "Conversion Date"), in such sums as the Borrowers
may request; provided, however, the aggregate principal amount of
all Revolving Loans B at any time outstanding hereunder shall not
exceed $30,000,000 (the "Revolver B Commitment"). The Borrowers
may borrow, prepay and reborrow from the date hereof to the
Conversion Date, the full amount of the Revolver B Commitment or
any lesser sum; provided that Libor Loans shall be in an amount
of at least $100,000 and an integral multiple of $100,000.
(c) Subject to the terms and conditions of this Agreement,
the Bank and the Borrowers agree that the Revolving Loans B shall
convert to a term loan (the "Term Loan") on the Conversion Date
in the principal amount (the "Term Loan Principal") of the then
outstanding principal amount of the Revolving Loans B, but in any
event not in excess of the Revolver B Commitment. Any funds
repaid on or after the Conversion Date may not be readvanced
thereafter. In the event the terms and conditions set forth in
Section 2.2 for the Term Loan are not met in full as of the
Conversion Date, the outstanding principal balance of the
Revolving Loans B shall be due and payable in full on the
Conversion Date. The Term Loan Principal shall be payable
without setoff, deduction or counterclaim in twenty equal
consecutive quarterly installments on the last day of each fiscal
quarter, commencing March 31, 1999 and continuing until December
31, 2003, when all outstanding principal and accrued interest
thereon shall be due and payable in full without setoff,
deduction or counterclaim (the "Maturity Date").
1.2 The Notes. The Revolving Loans A shall be evidenced by
the Borrower's Revolving Credit Note in the form of Exhibit 1.2
(a) hereto and the Revolving Loans B shall be evidenced by the
Borrowers' Revolving Credit and Term Note, in the form of
Exhibit 1.2(b) hereto, each payable to the order of the Bank
(collectively, the "Notes"), said Revolving Credit Note amends
and restates the Original Revolving Note. The Notes are
incorporated herein by reference and made a part hereof.
1.3 Interest; Default Rate.
(a) Subject to this Agreement, the Borrowers may elect an
interest rate for each Revolving Loan A and Revolving Loan B
based on either (i) the Alternative Prime Rate or (ii) the
applicable Adjusted Libor Rate (as defined on Schedule B hereto)
plus .25%. Subject to the terms and conditions of this
Agreement, the Borrowers may elect an interest rate for the Term
Loan based on either (i) the Alternative Prime Rate or (ii) the
applicable Adjusted Libor Rate plus .50%. Each Prime Rate Loan
shall bear interest on the outstanding principal amount thereof
at a rate per annum equal to the Prime Rate (which rate shall
change contemporaneously with any change in the Prime Rate),
payable on the last day of each fiscal quarter, commencing on
March 31, 1997, and when such Prime Rate Loan is due (whether at
maturity, by reason of acceleration or otherwise). Libor Loans
shall bear interest, and otherwise be governed, in accordance
with Schedule B (the "Libor Terms").
(b) Overdue principal (whether at maturity, by reason of
acceleration or otherwise) and, to the extent permitted by
applicable law, overdue interest and fees or any other amounts
payable hereunder or under the Notes, shall bear interest from
and including the due date until paid, payable on demand, at a
rate per annum equal to 3% above the rate then applicable to
Prime Rate Loans. In addition, if the entire amount of any
required principal and/or interest is not paid in full within ten
days after the same is due, the Borrowers shall pay to the Bank a
late fee equal to 5% of the required payment.
1.4 Notice and Manner of Borrowing or Conversion of Loans.
(a) Whenever the Borrowers desire to obtain or continue a
Loan hereunder or convert an outstanding Loan to a Loan of a
different type, it shall notify the Bank (which notice shall be
irrevocable) by telex, telegraph or telephone received no later
than 10:30 a.m. Boston time on the date (i) of the requested
action, with respect to a Loan to be made, continued or converted
to a Prime Rate Loan, and (ii) two Business Days before the
requested action, with respect to a Loan to be made, continued as
or converted to a Libor Loan. Such notice shall specify (A) the
effective date and amount of each Loan or portion thereof to be
made, continued or converted, (B) the interest rate option to be
applicable thereto, and (C) the duration of the Libor Period, if
applicable. Each such notification (a
"Notice of Borrowing or Conversion") shall be immediately
followed by a written confirmation in the form attached hereto as
Exhibit 1.4.
(b) Subject to the Libor Terms, the Borrowers may convert
all or any part (in integral multiples of $100,000) of any
outstanding Loan into a Libor Loan or a Prime Rate Loan, as the
case may be, in the same aggregate principal amount, on any
Business Day (which, in the case of a conversion of an existing
Libor Loan, must be on the last day of the Libor Period
applicable to such existing Libor Loan).
1.5 Prepayments. Libor Loans may be prepaid, without
premium or penalty (but subject to the Libor Terms), on the last
day of the applicable Libor Period, upon two Business Days'
notice. Prime Rate Loans may be prepaid at any time, without
premium or penalty, on same day notice if such notice is received
prior to 10:30 a.m. on the date of such prepayment. Any interest
accrued on the amounts so prepaid to the date of such payment
must be paid at the time of any such payment.
1.6 Fees. The Borrowers shall pay to the Bank during the
Revolving Credit Period a non-refundable commitment fee computed
at the rate of .15% per annum on the average daily unused portion
of the Commitments, payable quarterly in arrears, on the last day
of March, June, September and December of each year and on the
last day of the Revolving Credit Period.
1.7 Capital Requirements. The Bank shall notify the
Borrowers if after the date hereof the Bank determines that (a)
the adoption after the date hereof of or change after the date
hereof in any law, rule, regulation or guideline regarding
capital requirements for banks or bank holding companies, or any
change after the date hereof in the interpretation or application
thereof by any governmental authority charged with the
administration thereof (to the extent such adoption or change
occurs after the date hereof), or (b) compliance by the Bank or
its parent bank holding company with any guideline, request or
directive taking effect after the date hereof of any such entity
regarding capital adequacy (whether or not having the force of
law), has the effect of reducing the return on the Bank's or such
holding company's capital as a consequence of the Bank's
commitment to make Loans hereunder to a level below that which
the Bank or such holding company could have achieved but for such
adoption, change or compliance (taking into consideration the
Bank's or such holding company's then existing policies with
respect to capital adequacy and assuming the full utilization of
such entity's capital) by any amount the Bank considers to be
material. The Borrowers agree to pay to the Bank the actual
amount of such reduction of return as and when such reduction is
determined, when the Bank presents a statement of the amount and
setting forth the Bank's calculation thereof. Such statement
shall be deemed true and correct, absent manifest error.
1.8 Method of Payment. All payments and prepayments of
principal and all payments of interest and fees shall be made by
the Borrowers to the Bank at its head office in immediately
available funds, on or before 11:00 a.m. (Boston time) on the due
date thereof, free and clear of, and without set-off, deduction,
withholding or counterclaim for, any taxes or other payments.
1.9 Computation of Interest and Fees. All interest and
fees payable hereunder shall be computed daily on the basis of a
360-day year, counting the actual number of days elapsed. If the
due date for any payment of principal is extended by operation of
law, interest shall be payable for such extended time. If any
payment required by this Agreement becomes due on a day that is
not a Business Day, such payment may be made on the next
succeeding Business Day (subject to the definition of Libor
Period set forth in the Libor Terms), and such extension shall be
included in computing interest in connection with such payment.
1.10 Use of Proceeds. The proceeds of the Revolving Loans
A and Revolving Loans B shall be used (a) for the working capital
requirements of the Corporation, (b) for fixed asset purchases by
the Corporation made in the ordinary course of business and not
pursuant to any business acquisition, and (c) up to $5,000,000 in
the aggregate for Permitted Acquisitions by the Corporation
("Acquisition Loans").
2. CONDITIONS OF LOANS.
2.1 Conditions Precedent to Initial Loan. The obligation
of the Bank to make its initial Loan is subject to the conditions
precedent that the Bank shall have received, in form and
substance reasonably satisfactory to the Bank and its counsel,
(a) all of the agreements, instruments and certificates described
on the Closing Agenda attached as Exhibit 2.1, duly executed and
delivered, together with all other documents and materials
referred to in such Closing Agenda, and (b) satisfactory evidence
of the completion of all actions referred to in such Closing
Agenda.
2.2 Conditions Precedent to all Loans. The obligation of
the Bank to make each Loan, including the initial Loan and the
Term Loan, or to continue or convert Loans to Libor Loans, is
further subject to the following conditions: (a) the Bank shall
have received a properly completed Notice of Borrowing or
Conversion, (b) the representations and warranties contained in
Section 3 shall be true and accurate in all material respects on
and as of the date of such Notice of Borrowing or Conversion and
on the effective date of the making, continuation or conversion
of each Loan as though made at and as of each such date (except
to the extent that such representations and warranties expressly
relate to an earlier date), (c) no Default shall have occurred
and be continuing, or would result from such Loan, and (d) no
change shall have occurred in any law or regulation or
interpretation thereof making it illegal or against the policy of
any governmental authority for the Bank to make Loans hereunder.
Each request for the making, continuation or conversion of a Loan
shall be deemed a representation and warranty to such effect by
the Borrowers as of the date of the making, continuation or
conversion of such Loan.
3. REPRESENTATIONS AND WARRANTIES.
To induce the Bank to enter into this Agreement and to make
Loans, each of the Borrowers makes the representations and
warranties set forth below, each of which representations and
warranties reflect the execution hereof and the initial Loan
hereunder, and shall survive the delivery of the Notes and the
making of all Loans:
3.1 Organization and Qualification.
(a) The Partnership (i) is limited partnership duly
organized, validly existing and in good standing under the laws
of the Commonwealth of Massachusetts, (ii) has all requisite
partnership power to own its property and conduct its business as
now conducted and as presently contemplated, (iii) is duly
qualified and in good standing as a foreign limited partnership
and is duly authorized to do business in each jurisdiction where
the nature of its properties or business requires such
qualification, and (iv) has no Subsidiaries, except SBCC Company,
Inc., a Delaware corporation, Oregon Beer and Brewing Co., Inc.
I, an Oregon corporation, and Xxxxxx Xxxxx Brewery Company, Ltd.,
an Ohio limited liability company. SBCC Company, Inc. is and
will remain an inactive corporation; Oregon Beer and Brewing Co.,
Inc. I is an active operating corporation but not a Material
Subsidiary; and Xxxxxx Xxxxx Brewery Company, Ltd., organized on
January 14, 1997, became a Material Subsidiary and an active
operating company on March 1, 1997, the effective date of its
acquisition of brewery assets located in Cincinnati, Ohio, from
The Schoenling Brewing Company. This representation shall be
updated from time to time by the Borrowers when new Subsidiaries
are formed in accordance with this Agreement.
(b) The Corporation (i) is a Massachusetts corporation duly
organized, validly existing and in good standing under the laws
of the Commonwealth of Massachusetts, (ii) has all requisite
corporate power to own its property and conduct its business as
now conducted and as presently contemplated, (iii) is duly
qualified and in good standing as a foreign corporation and is
duly authorized to do business in each jurisdiction where the
nature of its property or business requires such qualification,
and (iv)has the Subsidiaries identified on Exhibit 3.15. Each of
such Subsidiaries is engaging and will engage in no other
business other than holding limited partnership interests in the
Partnership.
(c) Each of the Subsidiaries (i) is a corporation duly
organized, validly existing and in good standing under its laws
of its state of incorporation, (ii) has all requisite corporate
power to own its own property and conduct its business as now
conducted and is presently contemplated, (iii) is duly qualified
and in good standing as a foreign corporation and is duly
authorized to do business in each jurisdiction where the nature
of its property or business requires such qualification, and (iv)
has no Subsidiaries.
3.2 Authority. The execution, delivery and performance of
this Agreement, the Notes, the guarantees of any Material
Subsidiaries and all related agreements, instruments and
certificates (all of the foregoing collectively referred to as
the "Loan Documents") and the transactions contemplated hereby
are within the partnership and corporate power and authority of
the Borrowers and the Subsidiaries who are named as parties
thereto, and have been authorized by the Corporation's Board of
Directors for the Corporation itself and as sole general partner
of the Partnership and by the Subsidiaries' Board of Directors,
as applicable, and all other necessary proceedings, and do not
and will not (a) violate the partnership agreement, certificate
of limited partnership, charter or bylaws of either Borrower or
any Subsidiary or any law, rule, order or regulation applicable
to any of them, (b) contravene any provision of, or constitute
(with due notice or lapse of time or both), a default under, any
other agreement, instrument, order or undertaking binding on
either Borrower or any Subsidiary, or (c) result in the creation
or imposition of any Encumbrance on any of the properties, assets
or rights of either Borrower or any Subsidiary.
3.3 Consents; Validity. The execution, delivery and
performance by each Borrower and each Subsidiary, if applicable,
of the Loan Documents and the transactions contemplated therein
do not require any approval or consent of, or filing or
registration with, any governmental or other agency or authority
or any other party. The Loan Documents are the legal, valid and
binding obligations of each Borrower and each Subsidiary who are
named as parties thereto, enforceable in accordance with their
respective terms except as limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally.
3.4 Title to Properties; Absence of Encumbrances. Each
Borrower and each Subsidiary has good title to all of the
properties, assets and rights purported to be owned by it,
including without limitation, those reflected in the financial
statements referred to in Section 3.5 (except inventory and
equipment disposed of in the ordinary course of business since
the date thereof), free from all Encumbrances, except Permitted
Encumbrances.
3.5 Financial Statements. The Corporation has furnished
the Bank its balance sheet as of December 31, 1995 and its
statements of operations and cash flows for the fiscal year then
ended, and related footnotes, audited and certified by Coopers &
Xxxxxxx. The Partnership has furnished the Bank with its balance
sheet as of December 31, 1995 and its statement of operations and
cash flow for the fiscal year then ended, and related footnotes,
audited and certified by Coopers and Xxxxxxx. Each of the
Corporation and the Partnership has furnished the Bank with its
balance sheet as of September 30, 1996 and its statement of
operations and cash flow for the 9-month period then ended, and
related footnotes, prepared by the chief financial officer of the
Corporation and the Partnership. All such financial statements
were prepared in accordance with generally accepted accounting
principles (subject to normal year-end adjustments in the
ordinary course of business with respect to such nine-month
interim statements) applied on a consistent basis throughout the
periods specified and present fairly the financial position of
each Borrower and their Subsidiaries as of such dates and the
results of the operations of each Borrower and their Subsidiaries
for such periods. There are no liabilities or commitments,
contingent or otherwise, not disclosed in such financial
statements that involve a material amount. Since the date of the
most recent audited financial statements delivered to the Bank,
except as otherwise disclosed in writing prior to the date hereof
to the Bank with respect to certain unrealized loss in investment
securities, there have been no changes in the assets,
liabilities, financial condition or business of either Borrower
or any Subsidiary, other than changes in the ordinary course of
business, the effect of which has not, in the aggregate, been
materially adverse to either Borrower or any Subsidiary or its
assets and properties.
3.6 Taxes. Each Borrower and each Subsidiary has filed all
federal, state and other material tax returns required to be
filed by it, if any, and has paid or made adequate provision for
the payment of all federal, state and other taxes, charges and
assessments, if any.
3.7 Litigation. Except as disclosed on Exhibit 3.7, there
is no litigation, arbitration, proceeding or investigation
pending, or, to the knowledge of any of the Borrowers' officers
or partners, threatened, against or affecting either Borrower or
any Subsidiary that, if adversely determined, would reasonably be
likely (a) to result in a material judgment not fully covered by
insurance or a forfeiture of all or any material part of the
property of either Borrower or any Subsidiary, or (b) otherwise
to have a material adverse effect on the assets, business,
prospects or condition, financial or otherwise, of either
Borrower or any Subsidiary.
3.8 Compliance with Laws and Agreements. Neither Borrower
nor any Subsidiary is a party to any agreement or instrument or
subject to any corporate or partnership restriction materially
adversely affecting its assets, business, prospects or condition,
financial or otherwise. Neither Borrower nor any Subsidiary is
in (a) violation or alleged violation of any provision of law or
regulation, including without limitation any ERISA provision, any
SEC law, rule or regulation or any Environmental Law, the
violation of which would reasonably be likely to have a material
adverse effect upon either Borrower or any Subsidiary, or any
order, judgment or decree of any court or other agency of
government or (b) default in the performance, observance or
fulfillment of any of the obligations, covenants or conditions
contained in any material agreement or instrument to which it is
a party. Neither Borrower nor any Subsidiary is subject to
regulation under the Investment Company Act of 1940, as amended.
3.9 No Insolvency. Neither Borrower nor any Subsidiary is
insolvent or unable to pay its debts as they become due; the
Loans made or to be made to the Borrowers do not and will not
render either Borrower insolvent or unable to pay its debts as
they become due; the capital of each Borrower and each Subsidiary
is not unreasonably small, compared with the capital of companies
of similar size and engaged in similar activities, in light of
the needs and anticipated needs for capital of the businesses
conducted or anticipated to be conducted by it; neither Borrower
nor any Subsidiary is contemplating either the filing of a
petition by it under any state or federal bankruptcy or
insolvency laws or the liquidating of all or a major portion of
its property, and none of the Borrowers' officers has knowledge
of any person contemplating the filing of any such petition
against either Borrower or any Subsidiary or any of its
properties and assets.
3.10 Full Disclosure. No statement of fact made by or on
behalf of either Borrower or any Subsidiary in any Loan Document
or other document provided to Bank contains any untrue statement
of a material fact or omits to state any material fact necessary
to make statements contained therein or herein not misleading.
There is no fact presently known to any of the Borrowers'
partners or officers which has not been disclosed to the Bank
which materially affects adversely or, as far as such officer or
partner can foresee, will materially affect adversely the assets,
business or condition (financial or otherwise) of either Borrower
or any Subsidiary. As of the date of this Agreement, no Default
exists.
3.11 Margin Stock. Neither Borrower owns or has any
present intention of acquiring, and no portion of any Loan is to
be used for the "purpose of purchasing or carrying", any "margin
stock" as such terms are used in Regulations U and X of the Board
of Governors of the Federal Reserve System, 12 C.F.R. 221 and
224, as amended.
3.12 Patents, Trademarks, Etc. Each Borrower and each
Subsidiary owns or possesses all the patents, trademarks, service
marks, trade names, copyrights, consents and licenses, and all
rights with respect to the foregoing, necessary for the current
and currently planned future conduct of its business, without any
known conflict with the rights of others.
3.13 ERISA. All contributions and other payments required
to be made by either Borrower or any entity with which either
Borrower would be aggregated (a "Commonly Controlled Entity")
under Section 414(b), (c), (m), or (o) of the Code to all
employee benefit plans, as defined in Section 3(3) of ERISA which
either Borrower or any Commonly Controlled Entity maintains or
maintained or to which any of them contributes or has contributed
(the "Employee Benefit Plans") have been made or reserves
adequate for such purposes have been set aside and reflected on
Borrower's financial statements. No Employee Benefit Plan which
is subject to Section 412 of the Code or Section 302 of ERISA has
an accumulated or waived funding deficiency, has permitted
decreases in its funding standard account, or has applied for a
waiver of the minimum funding standard or an extension of any
amortization period. No proceedings have been instituted to
terminate, or to appoint a trustee to administer, any Employee
Benefit Plan subject to Section 412 of the Code of Section 302 of
ERISA. No lien imposed under the Code or ERISA on the assets of
the Borrower or any Commonly Controlled Entity exists, or is
likely to arise, on account of any Employee Benefit Plan subject
to Section 412 of the Code of Section 302 of ERISA. Neither
Borrower nor any Commonly Controlled Entity has incurred, or is
likely to incur, any material withdrawal liability with respect
to any multiemployer plan as defined in Section 4001(a)(3) of
ERISA ("Multiemployer Plan"). No Multiemployer Plan is
insolvent, unable to pay its debts as they become due, or in
reorganization. Each Employee Benefit Plan which is an employee
pension benefit plan, as defined in Section 3(2) of ERISA, has
been determined to be qualified under Section 401(a) or Section
403(a) of the Code and nothing has occurred which would cause the
loss of such qualification or the imposition of any tax liability
or penalty under the Code or ERISA on either Borrower. Each
Employee Benefit Plan has been and is administered in accordance
with its terms and in material compliance with applicable law.
Neither Borrower nor any Commonly Controlled Entity has breached
any fiduciary duty imposed on it under ERISA with respect to any
Employee Benefit Plan or has engaged in any prohibited
transaction, as defined in Title I of ERISA or Section 4975 of
the Code, involving any Employee Benefit Plan for which no
exemption is available. No Employee Benefit Plan which is an
employee welfare benefit plan, as defined in Section 3(1) of
ERISA, provides for continuing benefits or coverage for any
participant (or beneficiary) after the termination of the
participant's employment except as may be required under Section
4980B of the Code or applicable state statutory law.
3.14 Environmental Laws.
(a) Each Borrower and each Subsidiary has obtained all
permits, licenses and other authorizations which are required
under all Environmental Laws, except to the extent failure to
have any such permit, license or authorization would not have a
material adverse effect on either Borrower's or any Subsidiary's
business, financial condition or operations. Each Borrower and
each Subsidiary is in compliance with the terms and conditions of
all such permits, licenses and authorizations, and is also in
compliance with all other limitations, restrictions, conditions,
standards, prohibitions, requirements, obligations, schedules and
timetables contained in any applicable Environmental Law or in
any regulation, code, plan, order, decree, judgment, injunction,
notice or demand letter issued, entered, promulgated or approved
thereunder, except to the extent failure to comply would not have
a material adverse effect on either Borrower's or any
Subsidiary's business, financial condition, prospects or
operations.
(b) No notice, notification, demand, request for
information, citation, summons or order has been issued, no
complaint has been filed, no penalty has been assessed and no
investigation or review is pending or threatened by any
governmental or other entity with respect to any alleged failure
by either Borrower or any Subsidiary to have any permit, license
or authorization required in connection with the conduct of its
business or with respect to any Environmental Laws, including,
without limitation, Environmental Laws relating to the
generation, treatment, storage, recycling, transportation,
disposal or release of any Hazardous Materials, except to the
extent that such notice, complaint, penalty or investigation did
not or could not result in the remediation of any property owned
or used by either Borrower or any Subsidiary costing in excess of
$10,000 in the aggregate.
(c) To the best of each Borrower's knowledge, no material
oral or written notification of a release of a Hazardous Material
has been filed by or on behalf of either Borrower or any
Subsidiary and no property now or previously owned, leased or
used by either Borrower or any Subsidiary is listed or proposed
for listing on the National Priorities List under the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, or on any similar state list of sites
requiring investigation or clean-up.
(d) There are no Encumbrances arising under or pursuant to
any Environmental Laws or any of the real property or properties
owned, leased or used by either Borrower or any Subsidiary and no
governmental actions have been taken or are in process which
could subject any of such properties to such liens or
encumbrances or, as a result of which either Borrower or any
Subsidiary would be required to place any notice or restriction
relating to the presence of Hazardous Materials at any property
owned by it in any deed to such property.
(e) Except as disclosed on Exhibit 3.14, neither Borrower
nor any Subsidiary, to the best knowledge of either Borrower, any
previous owner, tenant, occupant or user of any property owned,
leased or used by either Borrower or any Subsidiary has
(i) engaged in or permitted any operations or activities upon or
any use or occupancy of such property, or any portion thereof,
for the purpose of or in any way involving the handling,
manufacture, treatment, storage, use, generation, release,
discharge, refining, dumping or disposal (whether legal or
illegal, accidental or intentional) of any Hazardous Materials
on, under, in or about such property, except to the extent
commonly used in day-to-day operations of such property and in
such case only in compliance with all Environmental Laws, or
(ii) transported any Hazardous Materials to, from or across such
property except to the extent commonly used in day-to-day
operations of such property and, in such case, in compliance
with, all Environmental Laws; nor, to the best knowledge of
either Borrower, have any Hazardous Materials migrated from other
properties upon, about or beneath such property, nor, to the best
knowledge of either Borrower, are any Hazardous Materials
presently constructed, deposited, stored or otherwise located on,
under, in or about such property except to the extent commonly
used in day-to-day operations of such property and, in such case,
in compliance with, all Environmental Laws.
3.15 Ownership. The Corporation is the owner, directly or
thorough wholly-owned Subsidiaries, beneficially and legally, of
all of the outstanding equity interests in the Partnership.
Exhibit 3.15 sets forth in detail such direct and indirect
ownership. No person or entity not identified on Exhibit 3.15
has an equity interest in the Partnership or any right to acquire
such an interest. The Corporation's authorized capital stock
consists of two classes, a limited voting rights Class A Common
Stock and a full voting rights Class B Common Stock. Among its
voting rights, the holders of the Class A Common Stock have the
right to elect two of the Corporation's seven Directors, with the
remaining five Directors elected by the holders of the Class B
Common Stock. C. Xxxxx Xxxx is currently the sole holder,
beneficially and legally, of all of the issued and outstanding
shares of the Class B Common Stock. The Class A Common Stock is
publicly traded and is listed on the New York Stock Exchange.
4. AFFIRMATIVE COVENANTS.
Each of the Borrowers covenants and agrees that, so long as
the Bank has any commitment to lend hereunder or in connection
with any other Obligation, or any Loan or other Obligation
remains outstanding, each of the Borrowers will, and will cause
each Subsidiary to:
4.1 Financial Reporting. Furnish to the Bank:
(a) Within 120 days after the end of each fiscal year, its
consolidated balance sheet as of the end of, and the related
statements of operations and cash flow for, such year, and
comparisons to prior years, audited and certified by Coopers &
Xxxxxxx (or other independent certified public accountants
acceptable to the Bank), together with related consolidating
statements, and promptly (and in any event within five days)
after the same is available, a copy of the management letter
prepared by such accountants with respect thereto;
(b) Within 55 days after the end of each fiscal quarter,
its consolidated balance sheet as of the end of, and the related
statements of operations and cash flow for, the period then ended
and year-to-date, and comparisons to prior periods and years,
certified by the Borrowers' chief financial officer (subject to
normal, recurring year-end adjustments that shall not in the
aggregate be material in amount);
(c) On the date hereof and concurrently with the delivery
of the annual and quarterly financial statements required by
Sections 4.1(a) and (b), a report substantially in the form of
Exhibit 4.1 hereto signed on behalf of the Borrower by its chief
financial officer;
(d) No later than 60 days after the beginning of each
fiscal year, financial projections of the Borrowers for such
fiscal year;
(e) Immediately upon becoming aware of the existence of any
condition or event that constitutes a Default, written notice
thereof specifying the nature and duration thereof and the action
being or proposed to be taken with respect thereto;
(f) Promptly (and in any event within five days) after
becoming aware of any litigation or of any investigative
proceedings by a governmental agency or authority commenced or
threatened against either Borrower or any Subsidiary , the
outcome of which would have a reasonable likelihood of resulting
in a materially adverse effect on any of its material assets or
its business or financial condition, written notice thereof and
of the action being or proposed to be taken with respect thereto;
(g) Promptly after the same are available, copies of all
financial statements, proxy statements and regular and periodic
reports as the Partnership shall send to its partners or as the
Corporation may send to its stockholders or file with the SEC or
any other governmental authority at any time having jurisdiction
over either Borrower;
(h) If and when either Borrower gives or is required to
give notice to the PBGC of any "Reportable Event" (as defined in
Section 4043 of ERISA) with respect to any Employee Benefit Plan
that might constitute grounds for a termination of such Employee
Benefit Plan under Title IV of ERISA, or knows that any member of
the Commonly Controlled Entity or the Employee Benefit Plan
Administrator of any Employee Benefit Plan has given or is
required to give notice of any such Reportable Event, a copy of
the notice of such Reportable Event given or required to be given
to the PBGC;
(i) Promptly upon becoming aware of any investigative
proceedings by a governmental agency or authority commenced or
threatened against either Borrower or any Subsidiary regarding
any potential violation of Environmental Laws or any spill,
release, discharge or disposal of any Hazardous Material, written
notice thereof and the action being or proposed to be taken with
respect thereto; and
(j) From time to time, such other data and information
(financial and otherwise) about either Borrower or any Subsidiary
and its assets and properties as the Bank may reasonably request.
4.2 Conduct of Business. (a) As to the Partnership,
maintain in good standing its existence as a Massachusetts
limited partnership and its foreign qualifications as required by
applicable law where the failure to do so qualify could have a
material adverse effect on it and, as to the Corporation,
maintain in good standing its existence as a Massachusetts
corporation and its foreign qualifications as required by
applicable law where the failure to so qualify could have a
material adverse effect on it, (b) as to any Subsidiary, maintain
in good standing its existence as a corporation under its state
of incorporation and its foreign qualifications as required by
applicable law where the failure to so qualify could have a
material adverse effect on it, (c) duly observe and comply in all
material respects with all applicable laws and all applicable
requirements of any governmental authorities whether now in
effect or hereafter enacted or promulgated, including without
limitation Environmental Laws, SEC laws, rules and regulations
and ERISA, (d) comply in all material respects with all material
agreements to which it is or becomes a party, (e) maintain and
keep in full force and effect all patents, trademarks, licenses,
permits and other intangibles necessary in any material respect
to the proper conduct of its business, and (f) remain and engage
in substantially the same business as that in which each is now
engaged.
4.3 Maintenance and Insurance. Maintain its properties in
good repair, working order and condition as required for the
normal conduct of its business; and at all times maintain
liability, product liability, builder's risk, workers'
compensation, casualty and other insurance insuring such Borrower
or Subsidiary and its properties with financially sound and
reputable insurers in such amounts as the officers or partners of
such Borrower or Subsidiary in the exercise of their reasonable
judgment deem to be adequate and, in any event, in customary
amounts with respect to like properties or risks of companies
conducting similar businesses; at the Bank's request from time to
time, deliver certificates of insurance evidencing such coverage.
4.4 Taxes and Accounts Payable. Pay or cause to be paid
all taxes, assessments or governmental charges on it or its
respective properties, as well as all lawful claims for labor,
materials and supplies or otherwise, which, if unpaid, could
become a lien or charge upon such properties or any part thereof
when or before they become due; provided that this covenant shall
not apply to any tax, assessment or charge that is being
contested in good faith by appropriate proceedings and with
respect to which adequate reserves have been established and are
being maintained in accordance with generally accepted accounting
principles.
4.5 Maintenance of Books and Records. Keep adequate books
and records of account, in which true and complete entries will
be made reflecting all of its business and financial transactions
and prepare financial statements hereunder in accordance with
U.S. generally accepted accounting principles consistently
applied and applicable law. Permit agents or representatives of
the Bank, at any reasonable time, and upon reasonable notice (or
if a Default shall have occurred and is continuing, at any time
without prior notice), to (a) examine, make copies of and take
abstracts from the financial and accounting books and records of
the Borrowers, and (b) discuss the affairs, finances and accounts
of the Borrowers with their officers, partners, employees and
accountants.
4.6 Environmental Laws. Comply in all material respects
with, and perform all Clean-up Work necessary under, all
Environmental Laws applicable (now or in the future) to either
Borrower or any Subsidiary or its business.
4.7 Further Assurances. At any time and from time to time,
(a) cause any Subsidiary prior to or upon becoming a Material
Subsidiary to execute and deliver to Bank an unlimited guaranty
in favor of Bank, guaranteeing all existing and future
obligations of Borrowers to Bank; and (b) execute and deliver
such further instruments and take such further action as may
reasonably be requested by the Bank to effect the purposes of the
Loan Documents.
4.8 Principal Depository. Use the Bank as its principal
depository.
5. FINANCIAL COVENANTS.
5.1 Covenants. Each of the Borrowers covenants and agrees
that, so long as the Bank has any commitment to lend hereunder or
any Loan or other Obligation to the Bank remains outstanding,
each of the Borrowers will:
(a) Maintain at all times during the period from December
31, 1996 through March 31, 1997 a Tangible Net Worth of the
Corporation of not less than $50,000,000; thereafter maintain
Tangible Net Worth of the Corporation at all times during each
fiscal quarter of at least (i) the minimum amount of Tangible Net
Worth required hereunder as of the last day of the immediately
preceding fiscal quarter, plus (ii) 50% of the positive Net
Income (with no reduction for losses) for such immediately
preceding fiscal quarter; and
(b) Not permit at any time the ratio of Total Liabilities
of the Corporation to Tangible Net Worth of the Corporation to be
greater than 1.00:1.00;
(c) Not permit the ratio of Total Funded Debt of the
Corporation at any time to EBITDA of the Corporation for the most
recently ended period of four consecutive fiscal quarters to be
greater than 2.50:1.00; and
(d) As to the Corporation, earn Net Income of at least
$1.00 in every fiscal quarter.
5.2 Definitions. For purposes of this Section, the
following terms shall have the following meanings and any
undefined terms shall be defined in accordance with generally
accepted accounting principles on a basis consistent with (a)
that used in prior periods and (b) that in preparing the audited
financial statements referred to in Sections 3.5 and 4.1(a):
(a) As used herein, "EBITDA" shall mean, for any period, an
amount equal to Net Income of the Corporation for such period
plus, to the extent deducted in the calculation of Net Income for
such period (i) taxes in respect of income and profits paid or
accrued by the Corporation during such period (ii) Interest
Expense for such period and (iii) depreciation, amortization and
other non-cash charges taken in accordance with generally
accepted accounting principles for such period.
(b) As used herein, "Indebtedness for Borrowed Money" shall
mean, without duplication, all indebtedness with respect to any
of the following of the Corporation: (i) money borrowed (whether
recourse or nonrecourse), including principal, interest and
premiums, (ii) obligations evidenced by a bond, debenture, note
or other similar written obligation to pay money, (iii)
capitalized lease obligations, (iv) obligations under conditional
sales or other title retention agreements or secured by any
Encumbrance, (v) any letters of credit or similar instruments
(including reimbursement obligations with respect thereto), (vi)
the deferred purchase price of property or services, except trade
payables and accrued expenses as incurred in the ordinary course
of business, or (vii) any guaranty of any or all of the
foregoing, in case each determined in accordance with generally
accepted accounting principles.
(c) As used herein, "Interest Expense" shall mean, for any
period, interest expense (including imputed interest on capital
lease obligations) of the Corporation for such period.
(d) As used herein, "Net Income" shall mean the net income
(or loss) of the Corporation, after deducting all operating
expenses, provisions for all taxes and reserves (including
reserves for deferred income taxes) and all other proper
deductions, all determined in accordance with generally accepted
accounting principles.
(e) As used herein, "Tangible Net Worth" shall mean as of
any date as of which the amount thereof shall be determined, the
total assets of the Corporation minus (a) the sum of any amounts
attributable to (i) goodwill, (ii) intangible items such as
unamortized debt discount and expense, patents, trade and service
marks and names, copyrights and research and development expenses
except prepaid expenses, (iii) all reserves not already deducted
from assets, (iv) any write up in the book value of assets
resulting from any revaluation thereof subsequent to the date of
the Corporation's audited financial statements referred to in
Section 3.5, and (v) the value of any minority interest in any
Subsidiaries (other than Permitted Acquisitions), and (b) Total
Liabilities of the Corporation.
(f) As used herein, "Total Funded Debt" shall mean at any
time, all Indebtedness for Borrowed Money of the Corporation at
such time, determined in accordance with generally accepted
accounting principles. The aggregate amount of Total Funded Debt
at any time shall include all accrued interest which has become
due and payable but has not been paid (whether or not
capitalized).
(g) As used herein, "Total Liabilities" shall mean at any
date as of which the amount thereof shall be determined, all
obligations which should, in accordance with generally accepted
accounting principles, be classified as liabilities on the
balance sheet of the Corporation, including in any event all
Indebtedness.
6. NEGATIVE COVENANTS.
Each of the Borrowers covenants and agrees that, so long as
the Bank has any commitment to lend hereunder or any Loan or
other Obligation to the Bank remains outstanding, each of the
Borrowers will not, and will cause each of the Subsidiaries to
not:
6.1 Indebtedness, Guarantees. Create, incur, assume or be
or remain liable with respect to any Indebtedness or Guarantees,
other than the following:
(a) Indebtedness of the Borrowers to the Bank or any of its
affiliates;
(b) Indebtedness existing as of the date of this Agreement
in an outstanding principal amount of not greater than $2,200,000
under that certain Loan, Security and Trust Agreement, dated as
of October 1, 1987 among the Partnership, The First National Bank
of Boston, as trustee, and the Massachusetts Industrial Finance
Agency, provided such Indebtedness shall not be modified or
amended, nor shall payment thereof be extended without the prior
written consent of the Bank;
(c) Purchase money Indebtedness permitted under Section
6.2(c);
(d) Guarantees in favor of the Bank or any of its
affiliates; and
(e) Guarantees resulting from the endorsement of negotiable
instruments for collection in the ordinary course of business.
6.2 Encumbrances. Create, incur, assume or suffer to exist
any mortgage, pledge, security interest, lien or other charge or
encumbrance, including the lien or retained security title of a
conditional vendor upon or with respect to any of its property or
assets ("Encumbrances"), or assign or otherwise convey any right
to receive income, except the following ("Permitted
Encumbrances"):
(a) landlords' and lessors' liens in respect of rent not in
default or liens in respect of pledges or deposits under workers'
compensation, unemployment insurance, social security laws, or
similar legislation (other than ERISA) or in connection with
appeal and similar bonds incidental to litigation; mechanics' and
similar liens, if the obligations secured by such liens are not
then delinquent; liens securing the performance of bids, tenders,
contracts (other than for the payment of money); and statutory
obligations incidental to the conduct of its business that do not
in the aggregate materially detract from the value of the
property of the Borrower, or materially impair the use thereof in
the operation of the business of the Borrower;
(b) judgment liens that shall not have been in existence
for a period longer than 30 days after the creation thereof or,
if a stay of execution shall have been obtained, for a period
longer than 30 days after the expiration of such stay;
(c) Encumbrances against either Borrower or any Subsidiary
securing purchase money Indebtedness for tangible personal
property (other than inventory) in the ordinary course of
business in an aggregate amount (for the Borrowers and the
Subsidiaries as a group) of no more than $5,000,000, provided
that (i) the obligations secured by any such Encumbrance shall
not exceed 100% of the lesser of cost or fair market value as of
the time of the acquisition of such property covered thereby, and
(ii) each such Encumbrance shall at all times be limited solely
to the item or items of property so acquired;
(d) Encumbrances on certain assets of the Partnership and
the Corporation (other than accounts and inventory and proceeds
thereof) securing only the Indebtedness permitted under Section
6.1(b); and
(e) easements, rights of way, restrictions and other
similar charges or Encumbrances relating to real property and not
interfering in a material way with the ordinary conduct of the
business of the Borrower and the Subsidiaries.
6.3 Sale and Leaseback. Enter into any arrangement,
directly or indirectly, whereby it shall sell or transfer any
property owned by it, in order to lease such property or lease
other property that either Borrower or any Subsidiary intends to
use for substantially the same purpose as the property being sold
or transferred.
6.4 Merger; Consolidation; Disposition of Assets; Etc.
Without the Bank's prior written consent: sell, lease or
otherwise dispose of any of its assets or properties except
inventory and/or equipment in the ordinary course of business;
amend or permit the amendment of its partnership agreement or
certificate of limited partnership or charter or bylaws in any
way that could have a material adverse effect upon its business
or the Bank's rights under any Obligation or alter the relative
voting rights of the Class A and Class B Common Stock of the
Corporation (whether for the Board of Directors or otherwise);
dissolve, liquidate, merge or consolidate into or with any other
person or entity; form (by spin-off or otherwise) any Subsidiary
unless no Default then exists or would result therefrom and such
Subsidiary , if a Material Subsidiary, executes and delivers in
favor of the Bank an unlimited guaranty, in form satisfactory to
the Bank, guaranteeing all existing and future obligations of the
Borrowers to the Bank; or change its fiscal year.
6.5 Investments. Make or maintain any Investments other
than Permitted Investments.
6.6 Transactions with Affiliates. Enter into any
transaction, including, without limitation, the purchase, sale or
exchange of property or assets or the rendering or accepting of
any service with or to any Affiliate of either Borrower or any
Subsidiary except in the ordinary course of business and pursuant
to the reasonable requirements of such Borrower's business or
Subsidiary's and upon terms not less favorable to the Borrowers
and the Material Subsidiaries than they could obtain in a
comparable arm's-length transaction with a third party other than
such Affiliate.
6.7 Distributions. Without the Bank's prior written
consent, no Borrower shall make any distributions on account of
or in redemption, retirement or purchase its capital stock,
partnership or other equity interests; except that (a) the
Partnership may make distributions on account of its partnership
interests to the Corporation, (b) the Subsidiaries may make
distributions on account of its capital stock to the Borrowers,
and (c) the Corporation may redeem from former employees non-
vested shares in the Corporation's Class A Common Stock issued
under the Corporation's Employee Equity Incentive Plan, to the
extent that the Corporation has the right to redeem such shares
under said Plan.
7. DEFAULTS.
7.1 Events of Default. There shall be an Event of Default
hereunder if any of the following events occurs:
(a) default in the payment or mandatory prepayment of any
amount of principal, interest, fees or expenses of any Loan or
any other Obligation when due; or
(b) failure to perform any term, covenant or agreement
contained in Section 4, Section 5, Section 6 or Section 8.2; or
(c) failure by either Borrower or any Subsidiary, as
applicable, to perform any other term, covenant or agreement
contained in any Loan Document if such default shall continue for
30 days after notice thereof is sent to the Borrowers by the
Bank; or
(d) any representation or warranty made in this Agreement
or any certificate or other document furnished by or on behalf of
either Borrower or any Subsidiary at the closing hereunder shall
prove to have been false in any material respect upon the date
when made or deemed to have been made; or
(e) default or breach (after the applicable grace period,
if any) under the Indebtedness described in Section 6.1(b) or
under any instrument or agreement of either Borrower or any
Subsidiary with respect to other Indebtedness of either Borrower
or any Subsidiary (other than to the Bank) for borrowed money or
with respect to financing available to either Borrower or any
Subsidiary (other than from the Bank), if the effect of such
default or breach is to permit the holder of such Indebtedness to
accelerate the maturity thereof; or
(f) either Borrower or any Subsidiary shall (i) apply for
or consent to the appointment of, or the taking of possession by,
a receiver, custodian, trustee, liquidator or similar official of
itself or of all or a substantial part of its property, (ii) be
generally not paying its debts as such debts become due,
(iii) make a general assignment for the benefit of its creditors,
(iv) commence a voluntary case under the Federal Bankruptcy Code
(as now or hereafter in effect), (v) take any action or commence
any case or proceeding under any law relating to bankruptcy,
insolvency, reorganization, winding-up or composition or
adjustment of debts, or any other law providing for the relief of
debtors, (vi) fail to contest in a timely or appropriate manner,
or acquiesce in writing to, any petition filed against it in an
involuntary case under the Federal Bankruptcy Code or other law,
(vii) take any action under the laws of its jurisdiction of
incorporation or organization similar to any of the foregoing, or
(viii) take any corporate action for the purpose of effecting any
of the foregoing; or
(g) a proceeding or case shall be commenced, without the
application or consent of either Borrower or any Subsidiary in
any court of competent jurisdiction, seeking (i) the liquidation,
reorganization, dissolution, winding up, or composition or
readjustment of such Borrower's or such Subsidiary's debts,
(ii) the appointment of a trustee, receiver, custodian,
liquidator or the like of all or any substantial part of either
Borrower's or any Subsidiary's assets, or (iii) similar relief in
respect of either Borrower or any Subsidiary, under any law
relating to bankruptcy, insolvency, reorganization, winding-up or
composition or adjustment of debts or any other law providing for
the relief of debtors, and such proceeding or case shall continue
undismissed, or unstayed and in effect, for a period of 60 days;
or an order for relief shall be entered in an involuntary case
under the Federal Bankruptcy Code, against either Borrower; or
action under the laws of the jurisdiction of incorporation or
organization similar to any of the foregoing shall be taken with
respect to either Borrower or any Subsidiary and shall continue
unstayed and in effect for any period of 60 days; or
(h) a judgment or order for the payment of money shall be
entered against either Borrower or any Subsidiary by any court,
or a warrant of attachment or execution or similar process shall
be issued or levied against property of either Borrower or any
Subsidiary, that in the aggregate exceeds $500,000 in value and
such judgment, order, warrant or process shall continue
undischarged or unstayed for 60 days or execution shall have
issued in respect thereto; or
(i) there shall occur any material adverse change in the
assets, liabilities, financial condition, business or prospects
of either Borrower or any Subsidiary, as reasonably determined by
the Bank acting in good faith; or
(j) for any reason, any Loan Document at any time shall not
be in full force and effect in all material respects or shall not
be enforceable in all material respects in accordance with its
terms, or any Encumbrance granted pursuant thereto shall fail to
be perfected, or any person or entity (other than the Bank) shall
contest the validity, enforceability or perfection of any
Encumbrance granted pursuant thereto, or any party thereto (other
than the Bank) shall seek to disaffirm, terminate, limit or
reduce its obligations under any of the Loan Documents; or
(k) for any reason, C. Xxxxx Xxxx shall cease to be
actively engaged on a full-time basis in the management of the
Borrowers, unless a successor or successors with qualifications,
experience and reputation within the consumer beverage business
reasonably acceptable to the Bank is appointed and commences
management of the Borrowers within 120 days after such cessation;
or
(l) for any reason, the Partnership's existing general
partner shall cease to be the sole general partner of the
Partnership; or
(m) for any reason, the Corporation shall cease to be the
beneficial and legal owner of all classes of voting and nonvoting
equity interests of the Partnership; or C. Xxxxx Xxxx shall cease
to be the beneficial and legal owner of at least 51% of all
issued and outstanding Class B Common Stock of the Corporation on
a fully diluted basis; or no Class B Common Stock of the
Corporation shall be issued and outstanding.
7.2 Remedies. Upon the occurrence of an Event of Default
described in Sections 7.1(f) and (g), immediately and
automatically, and upon the occurrence of any other Event of
Default, at any time thereafter while such Event of Default is
continuing, at the Bank's option and upon the Bank's declaration,
(a) the Commitment and all other commitments of the Bank to lend
to the Borrowers shall terminate; (b) the unpaid principal amount
of the Loans together with accrued interest and all other
Obligations shall become immediately due and payable without
presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived; and (c) the Bank may
exercise any and all rights it has under the Loan Documents or at
law or in equity, and proceed to protect and enforce the Bank's
rights by any action at law, in equity or other appropriate
proceeding.
8. GENERAL PROVISIONS.
8.1 Notices. Unless otherwise specified herein, all
notices hereunder to any party hereto shall be in writing, shall
be addressed to such party at its address indicated below, and
shall be deemed to have been given when delivered by hand, two
days after being properly deposited in the mails postage prepaid,
when sent by electronic telecopy transmission, or one day after
delivery to an overnight courier:
If to the Borrowers:
The Boston Beer Company, Inc.
Boston Beer Company Limited Partnership
00 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx, Chief Operating Officer
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxxxxx X. Xxxxx, Xx., Esq.
Xxxxxxxx, Xxxxxxx & Xxxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopy No.: (000) 000-0000
If to the Bank:
Fleet National Bank
Xxx Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: Xxxx Xxxxxx, VP
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxxx, Esq.
Xxxxxxx & Xxxxxx
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopy No.: (000) 000-0000
or at any other address specified by such party in writing.
8.2 Expenses. Pay to the Bank on demand all Expenses
incurred by the Bank.
8.3 Set-Off. Regardless of the adequacy of any collateral
(whether or not fully secured), if any, or other means of
obtaining repayment of the Obligations hereunder and any other
Obligations to the Bank, any deposits, balances or other sums
credited by or due from the head office of the Bank or any of its
branch offices to either Borrower or any Subsidiary may, at any
time and from time to time after the occurrence of an Event of
Default hereunder, without notice to the Borrowers or compliance
with any other condition precedent now or hereafter imposed by
statute, rule of law, or otherwise (all of which are hereby
expressly waived) be set off, appropriated, and applied by the
Bank against any and all Obligations of either Borrower or any
Subsidiary to the Bank, regardless of whether such Obligations
have matured, in such manner as the Bank in its sole discretion
may determine.
8.4 No Waivers; Term. No failure or delay by the Bank in
exercising any right, power or privilege hereunder or under any
other Loan Document shall operate as a waiver thereof; nor shall
any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right,
power or privilege. The rights and remedies herein and in the
other Loan Documents are cumulative and not exclusive of any
rights or remedies otherwise provided by agreement or law. This
Agreement shall continue in force and effect so long as the Bank
has any commitment to make Loans hereunder or any Loan or any
other Obligation shall be outstanding.
8.5 Governing Law. This Agreement, the Notes and the other
Loan Documents shall be deemed to be contracts made under seal
and shall be construed in accordance with and governed by the
laws of the Commonwealth of Massachusetts (without giving effect
to any conflicts of laws provisions contained therein).
8.6 Amendments. Neither this Agreement nor the Notes nor
any other Loan Document nor any provision hereof or thereof may
be amended or waived except by a written instrument signed by the
Bank and, in the case of amendments, by the Bank and the other
parties named thereto.
8.7 Binding Effect of Agreement. This Agreement shall be
binding upon and inure to the benefit of the Borrowers and the
Bank and their respective successors and assigns; provided that
neither Borrower may assign or transfer its rights or obligations
hereunder.
8.8 Entire Agreement. The Loan Documents constitute the
final agreement of the parties hereto and supersede any prior
agreement or understanding, written or oral, with respect to the
matters contained herein and therein.
8.9 Counterparts, Etc. This Agreement may be signed in any
number of counterparts with the same effect as if the signatures
hereto and thereto were upon the same instrument. The invalidity
or unenforceability of any one or more phrases, clauses or
sections of this Agreement shall not affect the validity or
enforceability of the remaining portions hereof. The captions
and headings of the various sections and subsections of this
Agreement are provided for convenience only and shall not be
construed to modify the meaning of such sections or subsections.
8.10 WAIVER OF JURY TRIAL. EACH OF THE BORROWERS AND THE
BANK AGREES THAT IT SHALL NOT (A) SEEK A JURY TRIAL IN ANY
LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER ACTION BASED UPON,
OR ARISING OUT OF, THIS AGREEMENT, OR ANY OTHER LOAN DOCUMENT OR
OBLIGATION, OR (B) SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY
OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY
DISCUSSED BY THE BANK AND THE BORROWERS AND SHALL BE SUBJECT TO
NO EXCEPTIONS. THE BANK HAS NOT AGREED WITH OR REPRESENTED TO
THE BORROWERS THAT THE PROVISIONS OF THIS SECTION WILL NOT BE
FULLY ENFORCED IN ALL INSTANCES.
8.11 CONSENT TO JURISDICTION. EACH OF THE BORROWERS HEREBY
SUBMITS TO THE JURISDICTION OF THE COURTS OF THE COMMONWEALTH OF
MASSACHUSETTS AND THE UNITED STATES DISTRICT COURT FOR THE
DISTRICT OF MASSACHUSETTS, AS WELL AS TO THE JURISDICTION OF ALL
COURTS FROM WHICH AN APPEAL MAY BE TAKEN OR OTHER REVIEW SOUGHT
FROM THE AFORESAID COURTS, FOR THE PURPOSE OF ANY SUIT, ACTION OR
OTHER PROCEEDING ARISING OUT OF EITHER BORROWER'S OBLIGATIONS
UNDER OR WITH RESPECT TO ANY LOAN DOCUMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREBY OR ANY OTHER OBLIGATION TO BANK,
AND EXPRESSLY WAIVES ANY AND ALL OBJECTIONS IT MAY HAVE AS TO
VENUE IN ANY OF SUCH COURTS.
8.12 Indemnification; Joint and Several Liability. Each of
the Borrowers will indemnify and hold the Bank harmless against
any and all claims, demands, suits, actions, causes of action,
damages, losses, settlement payments, obligations, costs,
expenses and all other liabilities whatsoever which shall at any
time or times be incurred or sustained by the Bank or by any of
its shareholders, directors, officers, employees, subsidiaries,
affiliates or agents (except any of the foregoing incurred or
sustained as a result of the gross negligence or willful
misconduct of the Bank) on account of, or in relation to, or in
any way in connection with, any of the arrangements or
transactions contemplated by, associated with or ancillary to any
of the Obligations. All of the obligations of the Borrowers
under any and all of the Loan Documents are and shall be joint
and several.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be executed under seal by their duly authorized officers as of
the day and year first above written.
THE BOSTON BEER COMPANY, INC.
By:
Title:
BOSTON BEER COMPANY LIMITED
PARTNERSHIP
By The Boston Brewing Company,
Inc.,
Its General Partner
By:
Title:
FLEET NATIONAL BANK
By:
Xxxx Xxxxxx, Vice President
Schedule A
General Defined Terms
As used herein, the following terms shall have the following
meanings and any undefined accounting terms shall be defined in
accordance with generally accepted accounting principles on a
basis consistent with (a) that used in prior periods and (b) that
used in preparing the audited financial statements referred to in
Sections 3.5 and 4.1(a):
Acquisition Loans: See Section 1.10.
Adjusted Libor Rate: See Schedule B.
Affiliate: as applied to the Borrower, any member, trustee,
director, officer, manager or employee, any corporation,
association, partnership, firm or other entity in which the
Borrower is a partner, shareholder (except any holder of not more
than 5% of the outstanding stock of any company listed on a
national securities exchange or actively traded on the over-the-
counter securities market), warrant holder, option holder,
member, director or officer, and any other person or entity
directly or indirectly controlling, controlled by, or under
common control with, the Borrower.
Alternative Prime Rate: The higher of (i) the Prime Rate,
and (ii) the Federal Funds Rate plus 1/2 of 1% per annum (rounded
upwards, if necessary, to the next 1/8 of 1%). The Alternative
Prime Rate is not necessarily intended to be the lowest rate of
interest determined by the Bank in connection with extensions of
credit.
Bank: see Preamble.
Borrower and Borrowers: see Preamble.
Business Day: (i) for all purposes other than as covered by
clause (ii) below, any day other than a Saturday, Sunday or legal
holiday on which banks in Boston, Massachusetts are open for the
conduct of a substantial part of their commercial banking
business; and (ii) with respect to all notices and determinations
in connection with, and payments of principal and interest on,
Libor Loans, any day that is a Business Day described in clause
(i) and also a day for trading by and between banks in U.S.
Dollar deposits in the interbank London market.
Clean-up Work: All activities, including, without
limitation, cleanup design and implementation, removal
activities, investigation, field and laboratory testing and
analysis, monitoring and other remedial and response actions,
taken or to be taken, arising out of or in connection with
Hazardous Materials, including without limitation (a) all
activities included within the meaning of the terms "removal,"
"remedial action" or "response", as defined in 42 U.S.C.
Section 9601(23), (24) and (25), and (b) all activities included
within the meaning of the terms "remedial response actions" and
"Remedial Response Implementation Plan (RRIP)," as defined in
310 CMR 40.
Code: the Internal Revenue Code of 1986 and the rules and
regulations thereunder, as may be supplemented or amended from
time to time.
Commitments: The Revolver A Commitment and the Revolver B
Commitment.
Commonly Controlled Entity: See Section 3.13.
Conversion Date: See Section 1.1(a).
Default: an Event of Default or event or condition that,
but for the requirement that time elapse or notice be given, or
both, would constitute an Event of Default.
EBITDA: See Section 5.2(c).
Employee Benefit Plan: See Section 3.13.
Encumbrance: See Section 6.2.
ERISA: the Employee Retirement Income Security Act of 1974
and the rules and regulations thereunder, as supplemented or
amended from time to time.
Environmental Laws: any and all applicable foreign,
federal, state and local environmental, health or safety
statutes, laws, regulations, rules, ordinances, policies and
rules or common law (whether now existing or hereafter enacted or
promulgated), of all governmental agencies, bureaus or
departments which may now or hereafter have jurisdiction over the
Borrower and all applicable judicial and administrative and
regulatory decrees, judgments and orders, including common law
rulings and determinations, relating to injury to, or the
protection of, human health or the environment, including,
without limitation, all requirements pertaining to reporting,
licensing, permitting, investigation, remediation and removal of
emissions, discharges, releases or threatened releases of
Hazardous Materials, chemical substances, pollutants or
contaminants whether solid, liquid or gaseous in nature, into the
environment or relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or
handling of such Hazardous Materials, chemical substances,
pollutants or contaminants.
Expenses: any and all present and future expenses incurred
by or on behalf of the Bank in connection with this Agreement or
any of the other Loan Documents, whether incurred heretofore or
hereafter, which expenses shall include, without being limited
to, the cost of record searches, attorneys' fees (for regulation,
preparation, execution and delivery of the Loan Documents and
amendments thereto and enforcement and collection and bankruptcy
services with respect thereto), disbursements and expenses, all
costs and expenses incurred by Bank in opening bank accounts,
depositing checks, receiving and transferring funds, and any
charges due to "insufficient funds" of deposited checks and the
Bank's standard fee relating thereto, the fees payable to the
collateral examination staff of the Bank, fees and expenses of
accountants, appraisers or other experts or advisors retained by
the Bank, fees and taxes relative to the filing of financing
statements, costs of preparing and recording the Loan Documents
and all other expenses, costs and fees contemplated by this
Agreement.
Event of Default: any event described in Section 7.1.
Expiration Date: See Section 1.1(a).
Federal Funds Rate: For any day, a fluctuating interest
rate per annum equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York,
or, if such rate is not so published for any day that is a
Business Day, the average of the quotations for such day on such
transactions received by the Bank from three Federal funds
brokers of recognized standing selected by the Bank.
Hazardous Material: any material or substance (a) which,
whether by its nature or use, is now or hereafter defined as a
hazardous waste, hazardous substance, hazardous material,
pollutant or contaminant under any Environmental Law, including,
but not limited to, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), 42 U.S.C.
9601(14) and (33), the Resource Conservation and Recovery Act
("RCRA"), 42 U.S.C. 6903(5), and the Massachusetts Oil and
Hazardous Material Chapter 21E, 2, (b) which is toxic,
explosive, corrosive, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous to human health or
the environment, (c) which is or contains petroleum or any
fraction thereof, including crude oil, heating oil, gasoline or
diesel fuel, or (d) the presence of which requires investigation
or remediation under any Environmental Law.
Indebtedness: (a) All obligations for borrowed money or
other extensions of credit whether or not secured or unsecured,
absolute or contingent, including, without limitation, unmatured
reimbursement obligations with respect to letters of credit or
guarantees issued for the account of or on behalf of the Borrower
and all obligations representing the deferred purchase price of
property, other than accounts payable arising in the ordinary
course of business, (b) all obligations evidenced by bonds,
notes, debentures or other similar instruments, (c) all
obligations secured by any mortgage, pledge, security interest or
other lien on property owned or acquired by the Borrower whether
or not the obligations secured thereby shall have been assumed,
and (d) all obligations arising under capital leases.
Interest Expense: See Section 5.2(c).
Investment: as applied to the Borrower, the purchase or
acquisition of any share of capital stock, partnership interest,
evidence of indebtedness or other equity security or all or
substantially all of the assets of any other person or entity,
any loan, advance or extension of credit to, or contribution to
the capital of, any other person or entity, any real estate held
for sale or investment, any commodities futures contracts held
other than in connection with bona fide hedging transactions, any
other investment in any other person or entity, and the making of
any commitment or acquisition of any option to make an
Investment.
Libor Base Rate: See Schedule B.
Libor Loan: any Loan bearing interest at a rate determined
with reference to the Adjusted Libor Rate.
Libor Period: See Schedule B.
Libor Terms: see Section 1.3 and Schedule B.
Loan Documents: see Section 3.2 of Schedule C.
Loans: The Revolving Loans A, the Revolving Loans B and the
Term Loan.
Material Subsidiary: At any date of determination, any
Subsidiary (a) whose total assets at the last day of the most
recently ended fiscal quarter have a market value equal to or
greater than 5% of the consolidated total assets of Borrowers and
their Subsidiaries at such date, determined in accordance with
generally accepted accounting principles, (b) whose Tangible Net
Worth at the last day of the most recently ended fiscal quarter
is equal to or greater than 5% of the Tangible Net Worth at such
date, or (c) whose gross revenues with respect to the most
recently ended four-quarter period are equal to or greater than
5% of the consolidated gross revenues of the Borrowers and their
Subsidiaries for such four-quarter period.
Maturity Date: See Section 1.1(c).
Multiemployer Plan: See Section 3.13.
Net Income: See Section 5.2(c).
Notes: see Section 1.2.
Notice of Borrowing or Conversion: see Section 1.4.
Obligations: any and all existing and future obligations
now or hereafter owed by the Borrower to the Bank, whether direct
or indirect, contingent or liquidated.
Original Agreement: See Recitals.
Original Revolving Note: See Recitals.
Partnership: See Preamble.
PBGC: the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
Permitted Acquisitions: any acquisition of stock or assets
by the Corporation which has met the following conditions:
(a) the aggregate amount of proceeds of the Loans used in all
such acquisitions since the date of this Agreement shall not
exceed $5,000,000, (b) the aggregate amount paid in cash or cash
equivalents by the Borrowers and their Subsidiaries in connection
with all such acquisitions since the date of this Agreement
(whether or not proceeds of the Loans) shall not exceed
$7,500,000, (c) after giving effect to such acquisition, on a pro
forma basis as of the most recently ended fiscal quarter, the
Borrowers shall be in full compliance with all of its obligations
set forth in Section 5 of this Agreement, (d) if such acquisition
is a stock acquisition and the acquired company or companies is
not being merged into the Corporation simultaneously and is or
becomes a Material Subsidiary, such acquired company or companies
shall prior to or upon becoming a Material Subsidiary execute an
unlimited guaranty in form satisfactory to the Bank, guaranteeing
all existing and future obligation of the Borrowers to the Bank,
(e) prior notice of such acquisition shall have been delivered to
the Bank, describing the terms of such acquisition, including the
purchase price thereof, and whether the acquired company or
companies are or are intended to become Material Subsidiaries,
and (e) no Default shall exist hereunder or result from such
acquisition. The Bank acknowledges that the Schoenling Brewery
acquisition which closed in March, 1997 (and the subsequent real
property acquisition relating thereto) are Permitted Acquisitions
not included in the $5,000,000 and $7,500,000 thresholds set
forth above.
Permitted Encumbrances: see Section 6.2.
Permitted Investments: as applied to either Borrower,
investments (i) in notes, bonds or other obligations of the
United States of America or any agency thereof that as to
principal and interest constitute direct obligations of or are
guaranteed by the United States of America; (ii) in certificates
of deposit or other deposit instruments or accounts of the Bank
or any other banks or trust companies organized under the laws of
the United States or any state thereof that have capital and
surplus of at least $100,000,000; (iii) in mutual funds investing
only in commercial paper that is rated not less than P-2 or A-2
or their equivalents by Xxxxx'x Investors Service, Inc. or
Standard & Poor's Corporation, respectively, or their successors;
(iv) up to $7,500,000 in the aggregate in connection with
Permitted Acquisitions after the date of this Agreement, (v) the
investments of the Corporation in its existing Subsidiaries, and
(vi) advances to employees for the purchase of stock options not
to exceed $1,000,000 outstanding at any time in the case of any
one employee and not to exceed $2,000,000 outstanding at any time
in the aggregate to all employees of the Borrowers.
Prime Rate: the annual floating rate of interest announced
from time to time by the Bank at its head office as its Prime
Rate.
Prime Rate Loan: any Loan bearing interest determined with
reference to the Alternative Prime Rate.
Revolver A Commitment: See Section 1.1(a).
Revolver B Commitment: See Section 1.1(b).
Revolving Credit Period: the period from the date hereof
through and including the Conversion Date and the Expiration Date
or such earlier date or dates by which both Commitments are
terminated.
Revolving Loans A: See Section 1.1(a).
Revolving Loans B: See Section 1.1(b).
SEC: The Securities and Exchange Commission and any
successor agency thereof.
Subsidiaries: (a) Any corporation, association, limited
liability company, joint stock company, business trust or other
similar organization of which 50% or more of the ordinary voting
power for the election of a majority of the members of the board
of directors or other governing body of such entity is held or
controlled by either Borrower or any Subsidiary of either
Borrower; (b) any other such organization the management of which
is directly or indirectly controlled by either Borrower or any
Subsidiary of either Borrower through the exercise of voting
power or otherwise; or (c) any joint venture, association,
partnership or other entity in which either Borrower or any
Subsidiary of either Borrower has at least a 50% equity interest,
directly or indirectly.
Tangible Net Worth: See Section 5.2(c).
Term Loan: See Section 1.1.
Total Liabilities: See Section 5.2(c).
Schedule B
Libor Terms
A. Definitions.
As used in this Schedule A, the following terms have the
following meanings:
Libor Period: With respect to each Libor Loan, the period
commencing on the date such Loan is made or converted from a
Prime Rate Loan, or the last day of the immediately preceding
Libor Period, as to Libor Loans being continued as such, and
ending one month, two months or three months thereafter, as
the Borrowers may elect in the applicable Notice of Borrowing
or Conversion; provided that:
(i) any Libor Period (other than a Libor Period determined
pursuant to clause (iv) below) that would otherwise end on a
day that is not a Business Day shall be extended to the next
succeeding Business Day unless such Business Day falls in the
next calendar month, in which case such Interest Period shall
end on the immediately succeeding Business Day;
(ii) if the Borrowers shall fail to give notice as provided
in Section 1.4, the Borrowers shall be deemed to have
requested a conversion of the affected Libor Loan to a Prime
Rate Loan on the last day of the then current Libor Period
with respect thereto;
(iii)any Libor Period relating to a Libor Loan that begins
on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall,
subject to clause (iv) below, end on the last Business Day of
a calendar month;
(iv) any Libor Period for a Revolving Loan A or Revolving
Loan B must end on or before the Expiration Date and the
Conversion Date, as applicable, and any Libor Period for the
Term Loan must end on or before the Maturity Date;
(v) no Libor Period shall include a principal repayment
date for the Loans unless an aggregate principal amount of
Loans at least equal to the principal amount due on such
principal repayment date shall be Prime Rate Loans or Libor
Loans having Libor Periods ending on or before such date; and
(vi) notwithstanding clauses (iv) and (v) above, no Libor
Period shall have a duration of less than one month.
Libor Base Rate: With respect to each day during each Libor
Period pertaining to any Libor Loans, the interest rate per
annum (rounded upward, if necessary, to the nearest 1/16th of
1%) at which the Bank is offered deposits in U.S. Dollars at
or about 10:00 A.M. (Eastern Time), two London business days
prior to the beginning of such Libor Period in the London
interbank market for delivery on the first day of such Libor
Period, for the number of days comprised therein and in an
amount comparable to the amount of the Libor Loan to be
outstanding during such Libor Period.
Adjusted Libor Rate: With respect to each day during each
Libor Period pertaining to a Libor Loan, a rate per annum
determined for such day in accordance with the following
formula (rounded upward, if necessary, to the nearest 1/16th
of 1%):
Libor Base Rate
1.00 - Libor Reserve Requirements
Libor Reserve Requirements: For any day as applied to a
Libor Loan, the aggregate (without duplication) of the rates
(expressed as a decimal fraction) of reserve requirements in
effect on such day (including without limitation basic,
supplemental, marginal and emergency reserves) under any
regulations of the Board of Governors of the Federal Reserve
System or other governmental authority having jurisdiction
with respect thereto) prescribed for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in
Regulation D of such Board) maintained by a member bank of
the Federal Reserve System.
Regulatory Change: Any change after the date of this
Agreement in United States federal, state or foreign law or
regulation (including without limitation Regulation D),
including without limitation the issuance of any final
regulations or guidelines, or the adoption or making after
such date of any interpretation, directive or request
applying to a class of banks including the Bank or under any
United States federal, state or foreign law or regulations
(whether or not having the force of law and whether or not
failure to comply therewith would be unlawful) by any court
or governmental or monetary authority charged with the
interpretation thereof.
Regulation D: Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be amended or
supplemented from time to time.
B. General Terms.
1. Libor Loans. Each Libor Loan shall bear interest on
the outstanding principal amount thereof, for each Libor Period
applicable thereto, at a rate as set forth in Section 1.3. Such
interest shall be payable for such Libor Period on the last day
thereof and when such Libor Loan is due (whether at maturity, by
reason of acceleration or otherwise) and, if such Libor Period is
longer than three months, at intervals of three months after the
first day thereof.
2. Requirements of Law.
(a) In the event that any Regulatory Change shall:
(i) change the basis of taxation of any amounts payable to
any Lender under this Agreement or either Note in respect of any
Libor Loans (other than taxes imposed on the overall net income
of the Bank);
(ii) impose or modify any reserve, compulsory loan
assessment, special deposit or similar requirement relating to
any extensions of credit or other assets of, or any deposits with
or other liabilities of, any office of the Bank (including any of
such Libor Loans or any deposits referred to in the definition of
"Libor Base Rate"); or
(iii) impose any other conditions affecting this Agreement
in respect of Libor Loans (or any of such extensions of credit,
assets, deposits or liabilities);
and the result of any of the foregoing shall be to increase the
Bank's costs of making or maintaining any Libor Loans, or any
Commitment, or to reduce any amount receivable by the Bank
hereunder in respect of any of its Libor Loans or any Commitment,
in each case only to the extent that such additional amounts are
not included in the Libor Base Rate applicable thereto, then the
Borrower shall pay on demand to the Bank from time to time, such
additional amounts as shall be sufficient to compensate the Bank
for such increased costs or reduced amount receivable.
3. Limitations on Libor Loans; Illegality.
(a) Anything herein to the contrary notwithstanding, if, on
or prior to the determination of an interest rate for any Libor
Loans for any applicable Libor Period, the Lender shall determine
(which determination shall be conclusive absent manifest error)
that:
(i) by reason of any event affecting United States money
markets or the London interbank market, quotations of
interest rates for the relevant deposits are not being
provided in the relevant amounts or for the relevant
maturities for purposes of determining the rate of interest
for such Loans under this Agreement; or
(ii) the rates of interest referred to in the definition of
"Libor Base Rate", on the basis of which the rate of interest
on any Libor Loans for such period is determined, do not
accurately reflect the cost to the Bank of making or
maintaining such Libor Loans for such period;
then the Bank shall give the Borrowers prompt notice thereof (and
shall thereafter give the Borrowers prompt notice of the
cessation, if any, of such condition), and so long as such
condition remains in effect, the Bank shall be under no
obligation to make Libor Loans or to convert Prime Rate Loans
into Libor Loans and the Borrowers shall, on the last day(s) of
the then current Libor Period(s) for any outstanding Libor Loans,
either prepay such Libor Loans in accordance with Section 4 of
this Schedule B or convert such Loans into Prime Rate Loans in
accordance with Section 1.4.
(b) Notwithstanding any other provision herein, if any
Regulatory Change shall make it unlawful for the Bank to make or
maintain Libor Loans as contemplated by this Agreement, (i) the
Bank's commitment hereunder to make Libor Loans, continue Libor
Loans as such and convert Prime Rate Loans to Libor Loans shall
thereupon terminate and (ii) the Loans then outstanding as Libor
Loans, if any, shall be converted automatically to Prime Rate
Loans on the respective last days of the then current Libor
Periods with respect to such Loans or within such earlier period
as required by law. If any such conversion of a Libor Loan
occurs on a day which is not the last day of the then current
Libor Period with respect thereto, the Borrower shall pay to such
Lender such amounts, if any, as may be required pursuant to
Section 4 of this Schedule B.
4. Payments before end of Libor Period, Etc.
The Borrowers shall pay to the Bank upon the Bank's request,
such amount or amounts as shall compensate the Bank for any loss
(including loss of profit), cost or expense incurred by the Bank
(as reasonably determined by it) as a result of:
(a) any payment or prepayment or conversion of any Libor
Loan on a date other than the last day of the Libor Period for
such Libor Loan (including without limitation any such payment,
prepayment or conversion required under Section 3 of this
Schedule B); or
(b) any failure by the Borrowers to borrow, convert into or
continue a Libor Loan on the date for such borrowing specified in
the relevant Notice of Borrowing or Conversion or otherwise; such
compensation to include, without limitation, an amount equal to:
(i) any loss or expense suffered by the Bank during the period
from the date of receipt of such early payment or prepayment or
the date of such conversion or failure to borrow, convert or
continue to the last day of such Libor Period, if the rate of
interest obtainable by the Bank upon the redeployment of an
amount of funds equal to the Libor Loans so paid, prepaid or
converted or as to which such failure to borrow, convert or
continue applies is less than the rate of interest applicable to
such Libor Loans for such Libor Period, and (ii) any loss or
expense suffered by the Bank in liquidating Libor deposits prior
to maturity which the Bank is unable to redeploy and which
correspond to the Libor Loans so paid, prepaid or converted or as
to which such failure to borrow, convert or continue applies.
The determination by the Bank of the amount of any such loss or
expense, when set forth in a written notice to the Borrowers,
containing the Bank's good faith calculation thereof in
reasonable detail, shall be presumed correct in the absence of
manifest error.
EXHIBIT 1.2(a)
REVOLVING CREDIT NOTE
$15,000,000 Boston,
Massachusetts
March 21, 1997
FOR VALUE RECEIVED, THE BOSTON BEER COMPANY, INC., a
Massachusetts corporation, and BOSTON BEER COMPANY LIMITED
PARTNERSHIP, a Massachusetts limited partnership (the
"Borrowers"), hereby jointly and severally promise to pay to
FLEET NATIONAL BANK (the "Bank"), or order, the principal amount
of $15,000,000, or, if less, the aggregate unpaid principal
amount of Revolving Loans A hereunder made by the Bank to the
Borrowers under the Credit Agreement of even date herewith by and
among the Borrowers and the Bank (as amended or extended from
time to time, the "Loan Agreement"), together with interest
thereon at the rate provided in the Loan Agreement, payable on
the dates and in such amounts as specified in the Loan Agreement,
and at the final maturity of this Note, whether by payment or
prepayment, acceleration or otherwise, without set-off, deduction
or counterclaim. The principal amount hereof may be advanced,
repaid and readvanced in accordance with the terms of the Loan
Agreement.
Overdue principal (whether on the due date of a Loan, by
reason of acceleration or otherwise) and, to the extent permitted
by applicable law, overdue interest and fees or any other amounts
payable under the Loan Agreement (including without limitation
overadvances) due to the Borrowers' failure to pay the same in
full shall bear interest from and including the due date thereof
until paid, at a rate per annum equal to 3% above the rate then
applicable to Prime Rate Loans, which interest shall be
compounded daily and payable on demand. In addition, if the
entire amount of any required principal and/or interest is not
paid in full within ten days after the same is due, the Borrowers
shall pay to the Bank a late fee equal to 5% of the required
payment.
The outstanding principal amount of this Note and accrued
and unpaid interest thereon shall be due and payable as provided
in the Loan Agreement. The Borrowers have the right in certain
circumstances to prepay this Note in whole or in part subject to
the terms and conditions provided in the Loan Agreement.
All payments under this Note shall be made at the head
office of the Bank at Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 (or at such other place as the Bank may designate to
Borrower from time to time in writing) in lawful money of the
United States of America in federal or other immediately
available funds.
This Note is the "Revolving Credit Note" referred to in and
is entitled to the benefits of the Loan Agreement (including the
Schedules thereto) and all other instruments evidencing and/or
securing the indebtedness hereunder, which Loan Agreement and
other instruments are hereby made part of this Note and are
deemed incorporated herein in full; but neither this reference to
the Loan Agreement nor any provision thereof shall affect or
impair the absolute and unconditional obligation of the Borrower
to pay the principal of and interest on this Note as herein
provided. The occurrence or existence of an "Event of Default"
as defined in the Loan Agreement shall constitute a default under
this Note and shall entitle the Bank to accelerate the entire
indebtedness hereunder and to take such other action as may be
provided for in the Loan Agreement or any other instrument or
agreement evidencing and/or securing this Note.
The Borrowers hereby waives presentment, demand, notice of
dishonor, protest and all other demands and notices in connection
with the delivery, acceptance, performance and enforcement of
this Note.
All agreements among the Borrowers and the Bank are hereby
expressly limited so that in no contingency or event whatsoever,
whether by reason of acceleration of maturity of the indebtedness
or otherwise, shall the amount paid or agreed to be paid for the
use or forbearance of the indebtedness evidenced hereby exceed
the maximum amount which the Bank is permitted to receive under
applicable law. If, from any circumstances whatsoever,
fulfillment of any provision hereof or of the Loan Agreement, at
the time performance of such provision shall be due, shall
involve exceeding such amount, then the obligation to be
fulfilled shall automatically be reduced to the limit of such
validity and if, from any circumstances the Bank should ever
receive as interest an amount which would exceed such maximum
amount, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced
hereby and not to the payment of interest. As used herein, the
term "applicable law" shall mean the law in effect as of the date
hereof, provided, however, that in the event there is a change in
the law which results in a higher permissible rate of interest,
then this Note shall be governed by such new law as of its
effective date. This provision shall control every other
provision of all agreements among the Borrowers and the Bank.
If this Note shall not be paid when due and shall be placed
by the holder hereof in the hands of any attorney for collection,
through legal proceedings or otherwise, the Borrowers will pay
reasonable attorneys' fees to the holder hereof together with
reasonable costs and expenses of collection, including, without
limitation, any such reasonable attorneys' fees, costs and
expenses relating to any proceedings with respect to the
bankruptcy, reorganization, insolvency, readjustment of debt,
dissolution or liquidation of either of the Borrowers or any
party to any instrument or agreement securing this Note, all as
provided in the Loan Agreement.
This instrument shall have the effect of an instrument
executed under seal and shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts
(without giving effect to any conflicts of laws provisions
contained therein).
THE BOSTON BEER COMPANY, INC.
By:
Title:
BOSTON BEER COMPANY LIMITED
PARTNERSHIP
By The Boston Brewing Company,
Inc.,
Its General Partner
By:
Title:
EXHIBIT 1.2(b)
REVOLVING CREDIT AND TERM NOTE
$30,000,000 Boston, Massachusetts
March 21, 1997
FOR VALUE RECEIVED, THE BOSTON BEER COMPANY, INC., a
Massachusetts corporation, and BOSTON BEER COMPANY LIMITED
PARTNERSHIP, a Massachusetts limited partnership (collectively,
the "Borrowers"), hereby jointly and severally promise to pay to
FLEET NATIONAL BANK (the "Bank"), or order, the principal amount
of $30,000,000, or, if less, the aggregate unpaid principal
amount of Revolving Loans B hereunder made by the Bank to the
Borrowers under the Credit Agreement of even date herewith by and
among the Borrowers and the Bank (as amended or extended from
time to time, the "Loan Agreement"), together with interest
thereon at the rate provided in the Loan Agreement, payable on
the dates and in such amounts as specified in the Loan Agreement,
and at the final maturity of this Note, whether by payment or
prepayment, acceleration or otherwise, without set-off, deduction
or counterclaim. The principal amount hereof may be advanced,
repaid and readvanced in accordance with the terms of the Loan
Agreement.
Overdue principal (whether on the due date of a Loan, by
reason of acceleration or otherwise) and, to the extent permitted
by applicable law, overdue interest and fees or any other amounts
payable under the Loan Agreement (including without limitation
overadvances) due to the Borrowers' failure to pay the same in
full shall bear interest from and including the due date thereof
until paid, at a rate per annum equal to 3% above the rate then
applicable to Prime Rate Loans, which interest shall be
compounded daily and payable on demand. In addition, if the
entire amount of any required principal and/or interest is not
paid in full within ten days after the same is due, the Borrowers
shall pay to the Bank a late fee equal to 5% of the required
payment.
The outstanding principal amount of this Note and accrued
and unpaid interest thereon shall be due and payable as provided
in the Loan Agreement. The Borrowers have the right in certain
circumstances to prepay this Note in whole or in part subject to
the terms and conditions provided in the Loan Agreement.
All payments under this Note shall be made at the head
office of the Bank at Xxx Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000 (or at such other place as the Bank may designate to
Borrower from time to time in writing) in lawful money of the
United States of America in federal or other immediately
available funds.
This Note is the "Revolving Credit and Term Note" referred
to in and is entitled to the benefits of the Loan Agreement
(including the Schedules thereto) and all other instruments
evidencing and/or securing the indebtedness hereunder, which Loan
Agreement and other instruments are hereby made part of this Note
and are deemed incorporated herein in full; but neither this
reference to the Loan Agreement nor any provision thereof shall
affect or impair the absolute and unconditional obligation of the
Borrower to pay the principal of and interest on this Note as
herein provided. The occurrence or existence of an "Event of
Default" as defined in the Loan Agreement shall constitute a
default under this Note and shall entitle the Bank to accelerate
the entire indebtedness hereunder and to take such other action
as may be provided for in the Loan Agreement or any other
instrument or agreement evidencing and/or securing this Note.
The Borrowers hereby waives presentment, demand, notice of
dishonor, protest and all other demands and notices in connection
with the delivery, acceptance, performance and enforcement of
this Note.
All agreements among the Borrowers and the Bank are hereby
expressly limited so that in no contingency or event whatsoever,
whether by reason of acceleration of maturity of the indebtedness
or otherwise, shall the amount paid or agreed to be paid for the
use or forbearance of the indebtedness evidenced hereby exceed
the maximum amount which the Bank is permitted to receive under
applicable law. If, from any circumstances whatsoever,
fulfillment of any provision hereof or of the Loan Agreement, at
the time performance of such provision shall be due, shall
involve exceeding such amount, then the obligation to be
fulfilled shall automatically be reduced to the limit of such
validity and if, from any circumstances the Bank should ever
receive as interest an amount which would exceed such maximum
amount, such amount which would be excessive interest shall be
applied to the reduction of the principal balance evidenced
hereby and not to the payment of interest. As used herein, the
term "applicable law" shall mean the law in effect as of the date
hereof, provided, however, that in the event there is a change in
the law which results in a higher permissible rate of interest,
then this Note shall be governed by such new law as of its
effective date. This provision shall control every other
provision of all agreements among the Borrowers and the Bank.
If this Note shall not be paid when due and shall be placed
by the holder hereof in the hands of any attorney for collection,
through legal proceedings or otherwise, the Borrowers will pay
reasonable attorneys' fees to the holder hereof together with
reasonable costs and expenses of collection, including, without
limitation, any such reasonable attorneys' fees, costs and
expenses relating to any proceedings with respect to the
bankruptcy, reorganization, insolvency, readjustment of debt,
dissolution or liquidation of either of the Borrowers or any
party to any instrument or agreement securing this Note, all as
provided in the Loan Agreement.
This instrument shall have the effect of an instrument
executed under seal and shall be governed by and construed in
accordance with the laws of the Commonwealth of Massachusetts
(without giving effect to any conflicts of laws provisions
contained therein).
THE BOSTON BEER COMPANY, INC.
By:
Title:
BOSTON BEER COMPANY LIMITED
PARTNERSHIP
By The Boston Brewing Company,
Inc.,
Its General Partner
By:
Title:
EXHIBIT 1.4
NOTICE OF BORROWING OR CONVERSION
Fleet National Bank
One Federal Street Date:
Xxxxxx, XX 00000
Attn: Xxxx Xxxxxx, Vice President
Re: Credit Agreement dated as of March
21, 1997 (as amended from time to time, the "Agreement")
among Fleet National Bank and The Boston Beer Company,
Inc. and Boston Beer Company Limited Partnership
(collectively, the "Borrowers")
Dear Xx. Xxxxxx:
Please accept this notice as the election of the Borrowers
as follows (Libor Loan must be in increments of $100,000 and
equal to or greater than $100,000):
A new [Revolving Loan A/Revolver Loan
B] request in the amount of $ to be borrowed
as a [Prime Rate Loan/Libor Loan]. [Such Libor Rate
option is selected for a term of:
one month
two months
three months from the date of the Loan advance.]
Conversion or continuation of a
portion of outstanding [Revolving Loans A/Revolving
Loans B/Term Loan] in the amount of $ from a
[Prime Rate Loan/Libor Loan] to a [Prime Rate Loan/Libor
Loan]. [Such Libor Rate option is selected for a term
of:
one month
two months
three months from the date of the conversion or
continuation.]
This Notice is issued in accordance with the provisions of
Section 1.4 of the Loan Agreement and is subject to the terms of
the Loan Agreement.
The representations and warranties contained in the
Agreement are true and accurate on and as of the effective date
of such advance, conversion or continuation as though made at and
as of such date (except to the extent that such representations
and warranties expressly relate to an earlier date); and no
Default has occurred and is continuing or will result from such
advance, conversion or continuance. The undersigned represents
and warrants that he is authorized to execute and deliver this
Notice on behalf of the Borrowers.
THE BOSTON BEER COMPANY, INC. and
BOSTON BEER COMPANY LIMITED
PARTNERSHIP
By:
Duly authorized signatory as to both
EXHIBIT 2.1
$45,000,000 Revolving Credit and Term Financing
of
THE BOSTON BEER COMPANY, INC.
and
BOSTON BEER COMPANY LIMITED PARTNERSHIP
by
FLEET NATIONAL BANK
March 21, 1997
AGENDA OF CLOSING
Responsible
Counsel
1. Credit Agreement between the Bank and Agreement: E&A
the Borrowers Disclosure
Exhibits: HWD
2. $30,000,000 Revolving Credit and Term E&A
Note
3. $15,000,000 Revolving Credit Note E&A
4. Guaranty of Xxxxxx Xxxxx Brewing E&A
Company, Ltd.
5. Certificate of Insurance HWD
6. Officer's Certificate certifying as to HWD
(and attaching) the Partnership's
(a) certificate of limited partnership,
(b) partnership agreement and
(c) partners' votes authorizing all
transactions contemplated by the Loan
Documents
7. Officer's Certificates certifying as to HWD
(and attaching) the Corporation's, the
Material Subsidiary's and the General
Partner's (a) corporate charter,
(b) bylaws, and (c) director's votes
authorizing all transactions
contemplated by the Loan Documents; and
certifying as to the incumbency of the
officers signing on behalf of the
Borrowers and the Material Subsidiary
8. Certificates of legal existence and HWD
partnership or corporate good standing
of the Borrowers, the General Partner
and the Material Subsidiary
9. UCC and federal tax lien searches HWD
against the Borrowers and the Material
Subsidiary (including trade names) and
their predecessors (within 5 years)
10. Copy of IRB Agreement and other Material HWD
Agreements, if any
11. Opinion of General Counsel to the HWD
Borrowers
and the Material Subsidiary
ABBREVIATIONS
Borrowers The Boston Beer Company, Inc.
("Corporation") and Boston Beer Company
Limited Partnership ("Partnership")
Bank Fleet National Bank
E&A Xxxxxxx & Xxxxxx, special counsel to
the Bank
HWD Xxxxxxxx, Xxxxxxx & Xxxxxxx
General Partner The general partner of the Partnership
Material Xxxxxx Xxxxx Brewery Company, Ltd.
Subsidiary
Exhibit 3.7
Litigation
Premier Worldwide Beer ("Premier"), the Partnership's former
exclusive distributor in the United Kingdom (the "U.K.") has
brought suit in the U.K. against the Partnership and Xxxxxxxxxx
PLC, asserting that certain aspects of the relationship between
Xxxxxxxxxx PLC and the Partnership which commenced prior to the
expiration of Premier's distribution rights violated those
rights. The Borrowers currently believe that the matter can be
settled with Borrowers' share of any settlement payment to
Premier not exceeding U.S. $3,000,000.
EXHIBIT 4.1
Officer's Compliance Certificate for Period Ended []
BOSTON BEER COMPANY LIMITED PARTNERSHIP and THE BOSTON BEER
COMPANY, INC. (collectively, the "Borrowers") HEREBY CERTIFIES
that:
This Report is furnished pursuant to Section 4.1(c) of the
Credit Agreement dated as of March 21, 1997 by and among the
Borrowers and Fleet National Bank, as amended from time to time
(the "Agreement"). Unless otherwise defined herein, the terms
used in this Report have the meanings assigned to them in the
Agreement.
As required by Section 4.1[(a)] or [(b)] of the Agreement,
the Borrowers' financial statements for the [year/quarter] ended
, 199 (the "Financial Statements"), prepared in
accordance with generally accepted accounting principles
consistently applied, accompany this Report. The Financial
Statements present fairly the financial position of the Borrowers
and their Subsidiaries as at the date thereof and the results of
operations for the period covered thereby [(subject only to
normal recurring year-end adjustments)].
Based on the Financial Statements provided with this Report,
the figures set forth in Schedule A hereto for determining
compliance by the Borrowers with the financial covenants
contained in Section 5 of the Agreement for the applicable
reporting periods are true, complete and correct.
The activities of the Borrowers during the periods covered
by such Financial Statements have been reviewed by the Chief
Financial Officer of the Borrowers or by employees or agents
under his or her immediate supervision. Based on such review, to
the best knowledge and belief of the undersigned, and as of the
date of this Report, the representations and warranties contained
in the Agreement are true and accurate as of the date hereof
(except to the extent that such representations and warranties
relate to an earlier date) and no Default has occurred.*
WITNESS my hand this day of , 19__.
BOSTON BEER COMPANY LIMITED PARTNERSHIP
and THE BOSTON BEER COMPANY, INC.
By:
Chief Financial Officer
* If a Default has occurred as of or prior to such date, this
paragraph is to be modified with an appropriate statement
as to the nature thereof, the period of existence thereof
and what action the Borrowers have taken, is taking, or
proposes to take with respect thereto.
Schedule A to
Compliance Certificate for Period Ended []
1. MINIMUM TANGIBLE NET WORTH (Section 5.1(a))
(a) Actual Tangible Net Worth of the Corporation
(i) Total Assets $
(ii) minus goodwill $
(iii) minus intangible items $
(iv) minus reserves not
already deducted $
(v) minus write-up in
book value of assets $
(vi) minus value of minor-
ity interests $
(excluding Permitted
Acquisitions)
(vii) minus Total Liabilities $
Actual Tangible Net Worth $
(b) Minimum Tangible Net Worth required $
($50,000,000 plus 50% positive Net
Income step up in each fiscal
quarter)
2. LEVERAGE (Section 5.1(b))
(a) Actual Ratio of Total Liabilities
to Tangible Net Worth:
(i) Total Liabilities $
(ii) Tangible Net Worth $
(iii) Actual Ratio of Total
Liabilities to Tangible Net
Worth _____:1.00
(b) Maximum Ratio of Total Liabilities
to Tangible Net Worth permitted 1.00:1.00
3. TOTAL FUNDED DEBT/EBITDA RATIO
(Section 5.1(c)) (rolling four-quarter
test)
(a) Actual Ratio of Total Funded Debt
to EBITDA:
(i) Actual Total Funded Debt (as
of last day of period) $
(ii) EBITDA:
(1) Net Income $
(2) plus taxes in respect
of income and profits $
(3) plus Interest Expense $
(4) plus depreciation,
amoritization and non-
cash charges $
EBITDA Total $
(iii) Actual Ratio of Total Funded
Debt to EBITDA 2.50:1.00
(b) Maximum Ratio of Total Funded Debt
to EBITDA permitted
4. PROFITABILITY (Section 5.1(d))
(a) Actual profits for fiscal quarter $
(b) Minimum required net profits for
fiscal quarter $1.00
