EXHIBIT 10.1
CREDIT AGREEMENT
Dated as of April 17, 1998
among
TRIDEX CORPORATION,
PROGRESSIVE SOFTWARE, INC.,
ULTIMATE TECHNOLOGY CORPORATION
TRIDEX NC, INC.
and
FLEET NATIONAL BANK
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CREDIT AGREEMENT dated as of April 17, 1998 among TRIDEX
CORPORATION, a Connecticut corporation ("Tridex"), PROGRESSIVE SOFTWARE, INC., a
North Carolina corporation ("PSI"), ULTIMATE TECHNOLOGY CORPORATION, , a New
York corporation ("UTC"), TRIDEX NC, INC., a North Carolina corporation ("Tridex
NC", and collectively, together with Tridex, UTC and PSI, the "Borrowers" and
each individually a "Borrower"), and FLEET NATIONAL BANK, a national banking
association organized under the laws of the United States of America (the
"Bank").
WHEREAS, the Borrowers desire that the Bank extend credit as
provided herein and the Bank is prepared to extend such credit; and
WHEREAS, the Borrowers are and will be operated on an integrated
basis in connection with their respective financial resources and each of the
Borrowers will receive direct and indirect economic and financial benefits from
the credit to be extended under this Agreement, and each of the Borrowers
acknowledges that the Bank would not provide the financing hereunder but for the
joint and several obligations of each such Borrower hereunder with respect to
all such indebtedness incurred hereunder.
NOW THEREFORE, in consideration of the foregoing, which is
incorporated by reference, and other valuable consideration, receipt of which is
acknowledged, the parties, intending to be legally bound, agree as follows:
ARTICLE 1. DEFINITIONS; ACCOUNTING TERMS
Section Definitions. As used in this Agreement, the following terms
have the following meanings (terms defined in the singular to have a correlative
meaning when used in the plural and vice versa):
"Affiliate" means any Person: (a) which directly or indirectly
controls, or is controlled by, or is under common control with, any Borrower or
any of their respective Subsidiaries; (b) which directly or indirectly
beneficially owns or holds five percent or more of any class of voting stock of
any Borrower or any of their respective Subsidiaries; (c) five percent or more
of the voting stock of which is directly or indirectly beneficially owned or
held by any Borrower or any of their respective Subsidiaries; or (d) which is a
partnership in which any Borrower or any of their respective Subsidiaries is a
general partner. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise.
"Agreement" means this Credit Agreement, as amended or supplemented
from time to time. References to Articles, Sections, Exhibits, Schedules and the
like refer to the Articles, Sections, Exhibits, Schedules and the like of this
Agreement unless otherwise indicated.
"Amortization Date" means the last day of each calendar quarter,
commencing on June 30, 1998, up to (and including) the Termination Date,
provided that if any such day is not a Banking Day, such day shall be the next
succeeding Banking Day.
"Banking Day" means, a day on which commercial banks settle payments
in (i) New York or London if the payment obligation is calculated by reference
to any LIBO Rate, or (ii) New York, if the payment obligation is calculated by
reference to the Prime Rate.
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"Borrowing" means any Loan requested by any Borrower hereunder.
"Borrowing Base" means an amount equal to the sum of (a) 80% of
Eligible Receivables, and (b) 50% of Eligible Inventory , provided, however, in
no event shall the aggregate amount under clause (b) exceed $3,500,000. Unless
the Bank shall otherwise determine, the Borrowing Base as of any date shall be
the Borrowing Base set forth on the most current Borrowing Base Certificate
certified and delivered by the Borrower pursuant to either Section 6.8 or
Section 4.2. If, at any time, the Borrowing Base shall exceed the Commitment,
for purposes of this Agreement the Borrowing Base shall be deemed to be equal to
the Commitment.
"Borrowing Base Certificate" means a certificate substantially in
the form of Exhibit B hereto or such other form agreed to in writing by the Bank
and the Borrower.
"Capital Lease" means any lease which has been or should be
capitalized on the books of the lessee in accordance with GAAP.
"Change of Control" means any one or more of the following events:
(a) the failure by Xxxx Xxxxxx to remain active in the day
to day senior management of Tridex; or
(b) the stockholders of any Borrower shall approve a plan or
proposal for the acquisition of, merger, liquidation or dissolution of such
Borrower, or a sale of more than 25% of its assets in one or a series of related
transactions (other than the proposed merger of Tridex NC into PSI; or
(c) a Person or group of Persons acting in concert (other than
the direct or indirect beneficial owners of the capital stock of any Borrower as
of the date of this Agreement) shall, as a result of a tender or exchange offer,
open market purchases, privately negotiated purchases or otherwise, have become
the direct or indirect beneficial owner (within the meaning of Rule 13d-3 under
the Securities Exchange Act of 1934, as amended from time to time) of securities
of such Borrower representing 25% or more of the combined voting power of the
outstanding voting securities for the election of directors or shall have the
right to elect a majority of the board of directors of such Borrower.
"Closing Date" means the date this Agreement has been executed by
the Borrowers and the Bank.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time.
"Commitments" means the Term Loan Commitment and the Working Capital
Commitment.
"Consolidated Subsidiary" means any Subsidiary whose accounts are or
are required to be consolidated with the accounts of a Person in accordance with
GAAP.
"Current Assets" of any Person at any time means all cash,
Receivables and Inventory of such Person.
"Current Funded Bank Debt" means, with respect to any Person, all
Debt of such Person for money borrowed, other than Subordinated Debt.
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"Current Liabilities" means all liabilities of a Person treated as
current liabilities in accordance with GAAP, including without limitation (a)
all obligations payable on demand or within one year after the date in which the
determination is made and (b) installment and sinking fund payments required to
be made within one year after the date on which determination is made, but
excluding all such liabilities or obligations which are renewable or extendible
at the option of such Person to a date more than one year from the date of
determination.
"Debt" means, with respect to any Person: (a) indebtedness of such
Person for borrowed money; (b) indebtedness for the deferred purchase price of
property or services (except trade payables in the ordinary course of business);
(c) Unfunded Benefit Liabilities of such Person; (d) the face amount of any
outstanding letters of credit issued for the account of such person; (e)
obligations arising under acceptance facilities; (f) guaranties, endorsements
(other than for collection in the ordinary course of business) and other
contingent obligations to purchase, to provide funds for payment, to supply
funds to invest in any Person, or otherwise to assure a creditor against loss,
including any contingent obligations under swaps, derivatives, currency
exchanges and similar transactions; (g) obligations secured by any Lien on
property of such Person; and (h) obligations of such Person as lessee under
Capital Leases.
"Default" means any event which with the giving of notice or lapse
of time, or both, would become an Event of Default.
"Default Rate" means, with respect to the principal of any Loan and,
to the extent permitted by law, any other amount payable by the Borrowers under
this Agreement or the Notes that is not paid when due (whether at stated
maturity, by acceleration or otherwise), a rate per annum during the period from
and including the due date, to, but excluding the date on which such amount is
paid in full equal to two percentage points above the Prime Rate as in effect
from time to time plus the applicable Margin (provided that, if the amount so in
default is principal of a LIBOR Loan and the due date thereof is a day other
than the last day of the Interest Period therefor, the "Default Rate" for such
principal shall be, for the period from and including the due date and to but
excluding the last day of the Interest Period therefor, two percentage points
above the interest rate for such Loan as provided in Section 2.10 hereof and,
thereafter, the rate provided for above in this definition).
"Dollars" and the sign "$" mean lawful money of the United States of
America.
"EBIT" means, for any Person, for any period, earnings before
Interest Expense and taxes for such Person determined in accordance with GAAP.
"EBITDA" means, for any Person, for any period, earnings before
Interest Expense, taxes, depreciation, amortization and extraordinary items for
such Person determined in accordance with GAAP.
"Eligible Inventory" means, as of any date of determination thereof,
all Inventory (valued at the lower of cost or its net realizable value as
determined using GAAP) owned by the Borrowers, but excluding (a) all Inventory
in which the Bank does not have a first perfected security interest, subject to
no other Lien prior to or on a parity with such security interest, (b) all
Inventory for which warehouse receipts or documents of title have been issued,
unless the same are delivered to the Bank, and (c) all other Inventory deemed
ineligible by the Bank because of any circumstance that could, in the Bank's
judgment, reasonably exercised, adversely affect the quality of such Inventory
as collateral security. Notwithstanding the preceding sentence, "Eligible
Inventory" shall not include any Inventory not located at premises owned by or
leased
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to or contracted to a Borrower, unless such Inventory is in transit (and
insured) or such Borrower has made a formal financing statement filing against
the consignee of such Inventory and has given any party claiming of record a
security interest in such consignee's Inventory, or other assets that might
include such Inventory, notice of such Borrower's consignment arrangements with
such consignee or has taken equivalent protective steps satisfactory to the
Bank.
"Eligible Receivables" means, as of any date of determination
thereof, all Receivables of the Borrowers net of the Borrowers' customary
reserves, discounts, credits, returns, rebates, allowances or set-offs,
excluding the following:
(i) any Receivable unpaid for 90 or more days from the
date of the original invoice;
(ii) any Receivable evidenced by chattel paper or an
instrument of any kind unless such chattel paper or instrument is pledged and
delivered to the Bank or unless the total amount of such Receivables at any one
time does not exceed 5% of total Eligible Receivables at such time;
(iii) any Receivable which is owed by an account debtor
which is insolvent or the subject of any bankruptcy or insolvency proceedings of
any kind or of any other proceeding or action, which might have an adverse
effect on the business of such account debtor;
(iv) all Receivables deemed uncollectable by a Borrower
or turned over to collection agencies or outside collection attorneys;
(v) any Receivable which is not a valid, legally
enforceable obligation of the account debtor or is subject to any present or
contingent, or any fact exists which is the basis for any future, offset or
counterclaim or other defense on the part of such account debtor;
(vi) any Receivable not evidenced by an invoice or other
documentation in form reasonably acceptable to the Bank;
(vii) any Receivable which arises out of any transaction
between (A) any Borrower and (B) any Subsidiary or any Affiliate or any other
Borrower;
(viii) any Receivable which is subject to any provision
prohibiting its assignment or requiring notice not theretofor given of or
consent not theretofor obtained to such assignment;
(ix) all Receivables from customers having their place
of business outside of the United States of America, except for such Receivables
backed by either (A) letters of credit denominated in Dollars issued to a
Borrower by banks acceptable to the Bank or (B) credit insurance policies
acceptable to the Bank;
(x) all Receivables arising out of or in connection with
advance xxxxxxxx of a customer's requirements of supplies over a period of time,
but only to the extent that such Receivables exceed 10% of all Eligible
Receivables;
(xi) all Receivables that do not conform to the
representations and warranties contained in Article 2 of the Security Agreement;
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(xii) all Receivables in which the Bank does not have a
first perfected security interest, subject to no other Lien prior to or on a
parity with such security interest;
(xiii) all Receivables not denominated in Dollars;
(xiv) all Receivables from an account debtor if more
than 50% of the aggregate Dollar amount of invoices billed with respect to such
account debtor is more than 90 days past due according to the original terms of
payment;
(xv) if any account debtor owes greater than 20% of the
Dollar value of total Receivables collectively owed to the Borrowers on a
consolidated basis, then all Receivables owed by such account debtor in excess
of such 20% limitation shall be ineligible;
(xvi) any Receivable in respect of which the U.S.
Government or any agency thereof is the account debtor;
(xvii) any Receivable which is owed by an account debtor
who has disputed liability or made any claim with respect to any other account
due from such account debtor to a Borrower, except the foregoing exclusion shall
not apply to any account debtor unless and until such disputed amounts equal or
exceed twenty percent (20%) of the aggregate Dollar amount of accounts due from
such account debtor; and
(xviii) any Receivable which is determined by the Bank,
in the exercise of its reasonable judgment, to be ineligible for any other
reason generally accepted in the commercial finance business as a reason for
ineligibility.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges, releases or threatened releases of pollutants, contaminants,
chemicals, or industrial, toxic or hazardous substances or wastes into the
environment including, without limitation, ambient air, surface water, ground
water, or land, or otherwise relating to the manufacture, processing
distribution, use, treatment, storage, disposal, transport, or handling of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended from time to time, including any rules and regulations promulgated
thereunder.
"ERISA Affiliate" means any corporation or trade or business which
is a member of any group of organizations (i) described in section 414(b) or (c)
of the Code of which any Borrower is a member, or (ii) solely for purposes of
potential liability under section 302(c)(11) of ERISA and section 412(c)(11) of
the Code and the lien created under section 302(f) of ERISA and section 412(n)
of the Code, described in section 414(m) or (o) of the Code of which any
Borrower is a member.
"Event of Default" has the meaning given such term in Section 9.1.
"Excess Cash Flow" shall mean (i) excess cash flow of the Borrowers
on a consolidated basis after all sources and uses of cash as shown on the
Borrowers' consolidated annual audited statement of cash flows in respect of
each fiscal year, minus (ii) the amount (if any) by which the outstanding
principal amount of the Working Capital Loans as at the end of
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such fiscal year exceeds the outstanding principal amount of the Working Capital
Loans as at the end of the fiscal year immediately preceding such fiscal year.
"Facility Documents" means this Agreement, the Notes, the
Subordination Agreements, the Security Agreement, the Pledge Agreement and each
of the documents, certificates or other instruments referred to in Article 4
hereof as well as any other document, instrument or certificate to be delivered
by the Borrowers in connection with this Agreement or in connection with the
documents, certificates or instruments referred to in Article 4, including
documents delivered in connection with any Borrowing.
"Fixed Charge Coverage Ratio" means, with respect to any Person, for
any period, the ratio of (i) EBITDA minus cash taxes paid, dividends paid and
any capital expenditures, to (ii) current maturities of long term Debt, plus
Interest Expense, for such period.
"Forfeiture Proceeding" means any action, proceeding or
investigation affecting the Parent or any of its Subsidiaries or Affiliates
before any court, governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, or the receipt of notice by any such party
that any of them is a suspect in or a target of any governmental inquiry or
investigation, which may result in an indictment of any of them or the seizure
or forfeiture of any of their property.
"Funded Debt" means, with respect to any Person, all Debt (senior
and subordinated) of such Person for money borrowed, including Capital Lease
obligations.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time, applied on a basis consistent
with those used in the preparation of the financial statements referred to in
Section 5.5 (except for changes concurred in by the Borrowers' independent
public accountants).
"Interest Coverage Ratio" means, with respect to any Person, for any
period, the ratio of (i) EBIT to (ii) Interest Expense for such period.
"Interest Expense" shall mean, with respect to any Person, for any
period, the sum, for such Person in accordance with GAAP, of (a) all interest on
Debt that is accrued as an expense during such period (including, without
limitation, imputed interest on Capital Lease obligations), plus (b) all amounts
paid, accrued or amortized as an expense during such period in respect of
interest rate protection agreements, minus (c) all amounts received or accrued
as income during such period in respect of interest rate protection agreements.
"Interest Period" means with respect to any LIBOR Loan, the period
commencing on the date such Loan is made, converted from another type of Loan or
renewed, as the case may be, and ending, as the Borrowers may select pursuant to
Section 2.11, on the numerically corresponding day in the first, second, third,
sixth (or if available through the Bank, the ninth or twelfth) calendar month
thereafter, provided that each such Interest Period which commences on the last
Banking Day of a calendar month (or on any day for which there is no numerically
corresponding day in the appropriate subsequent calendar month) shall end on the
last Banking Day of the appropriate calendar month. With respect to Prime Rate
Loans, "Interest Period" means the period commencing on the date such Loan was
made and ending on the Banking Day on which such Prime Rate Loan is repaid.
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"Inventory" means all inventory, now or hereafter owned and wherever
located, of the Borrowers, including (without limitation) raw materials,
work-in-process, finished goods, supplies and packaging materials.
"Lending Office" means the lending office of the Bank set forth on
the signature page.
"LIBO Rate" means, as applicable to any LIBOR Loan, the rate per
annum (rounded upward, if necessary, to the nearest 1/32 of one percent) as
determined on the basis of the offered rates for deposits in U.S. dollars, for a
period of time comparable to such LIBOR Loan which appears on the Telerate page
3750 as of 11:00 a.m. London time on the day that is two London Banking Days
preceding the first day of such LIBOR Loan; provided, however, if the rate
described above does not appear on the Telerate System on any applicable
interest determination date, the LIBOR rate shall be the rate (rounded upwards
as described above, if necessary) for deposits in dollars for a period
substantially equal to the interest period on the Reuters Page "LIBO" (or such
other page as may replace the LIBO Page on that service for the purpose of
displaying such rates), as of 11:00 a.m. (London Time), on the day that is two
(2) London Banking Days prior to the beginning of such interest period.
If both the Telerate and Reuters system are unavailable, then the
rate for that date will be determined on the basis of the offered rates for
deposits in U.S. dollars for a period of time comparable to such LIBOR Loan
which are offered by four major banks in the London interbank market at
approximately 11:00 a.m. London time, on the day that is two (2) London Banking
Days preceding the first day of such LIBOR Loan as selected by the Bank. The
principal London office of each of the four major London banks will be requested
to provide a quotation of its U.S. dollar deposit offered rate. If at least two
such quotations are provided, the rate for that date will be the arithmetic mean
of the quotations. If fewer than two quotations are provided as requested, the
rate for that date will be determined on the basis of the rates quoted for loans
in U.S. dollars to leading European banks for a period of time comparable to
such LIBOR Loan offered by major banks in New York City at approximately 11:00
a.m. New York City time, on the day that its two London Banking Days preceding
the first day of such LIBOR Loan. In the event that Bank is unable to obtain any
such quotation as provided above, it will be deemed that LIBOR pursuant to a
LIBOR Loan cannot be determined.
In the event that the Board of Governors of the Federal Reserve
System shall impose a Reserve Requirement with respect to LIBOR deposits of the
Bank then for any period during which such Reserve Requirement shall apply, LIBO
Rate shall be equal to the amount determined above divided by an amount equal to
1 minus the Reserve Requirement.
"LIBOR Loan" means any Loan when and to the extent the interest rate
therefor is determined on the basis of the definition "LIBO Rate."
"Lien" means any lien (statutory or otherwise), security interest,
mortgage, deed of trust, priority, pledge, negative pledge, charge, conditional
sale, title retention agreement, financing lease or other encumbrance or similar
right of others, or any agreement to give any of the foregoing.
"Loan" means any of the Term Loan or the Working Capital Loans, and
"Loans" means the Term Loan and the Working Capital Loans.
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"Margin" means the percentage points to be added to the Bank's Prime
Rate or the then applicable LIBOR Rate, in each case based upon the following
performance criteria:
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Prime Rate
LIBOR Margin Margin
Senior Funded Debt/EBITDA (Percentage (Percentage
of the Borrowers Points) Points)
---------------- ------- -------
Greater than or equal to 3.00 2.75 1.00
Less than 3.00, but greater than or 2.25 0.00
equal to 2.00
Less than 2.00, but greater than or 1.75 0.00
equal to 1.00
Less than 1.00 1.25 0.00
Notwithstanding the foregoing, the applicable Margins set forth above with
respect to the LIBOR Rates will be reduced by .25 percentage points upon
consummation of the Mass Mutual Transaction.
"Mass Mutual Transaction" means a transaction pursuant to which
Massachusetts Mutual Life Insurance Company and/or its affiliates acquire
approximately 285,714 shares of the capital stock of Tridex, which shares shall
be newly issued pursuant to an equity offering by Tridex.
"Multiemployer Plan" means a Plan defined as such in section 3(37)
of ERISA to which contributions have been made by the Borrowers or any ERISA
Affiliate and which is covered by Title IV of ERISA.
"Net Income (Loss)" of any Person for any period means the net
income (loss) of such Person for such period determined in accordance with GAAP.
"Net Income Increase" means, for any period, the aggregate of fifty
percent (50%) of the Borrowers' Net Income, on a consolidated basis, in respect
of such period.
"Notes" means the Term Note and the Working Capital Note.
"Notice of Borrowing" shall mean the notice of each Borrowing
described in Section 2.8 and in the form of Exhibit E hereto.
"PBGC" means the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Person" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint venture,
governmental authority or other entity of whatever nature.
"Plan" means any employee benefit or other plan established or
maintained, or to which contributions have been made, by any Borrower or any
ERISA Affiliate and which is covered by Title IV of ERISA, other than a
Multiemployer Plan.
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"Pledge Agreement" means the stock pledge agreement dated as of the
Closing Date by Tridex in favor of the Bank, in substantially the form of
Exhibit D.
"Prime Rate" means that rate of interest from time to time announced
by the Bank at its office located at 000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxx
Xxxxxx 00000, which rate may not be the Bank's lowest or best rate.
"Prime Rate Loan" means any Loan when and to the extent the interest
rate therefor is determined in relation to the Prime Rate.
"Receivables" means all accounts owing to a Person arising out of or
in connection with the bona fide sale or lease of goods or services in the
ordinary course of business.
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as the same may be amended or supplemented from time to
time.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as the same may be amended or supplemented from time to
time.
"Regulatory Change" means any change after the date of this
Agreement in United States federal, state, municipal or foreign laws or
regulations (including without limitation Regulation D) or the adoption or
making after such date of any interpretations, directives or requests applying
to a class of banks including the Bank of or under any United States, federal,
state, municipal or foreign laws or regulations (whether or not having the force
of law) by any court or governmental or monetary authority charged with the
interpretation or administration thereof.
"Reserve Requirement" means, for any Interest Period for any LIBOR
Loan, the average maximum rate at which reserves (including any marginal,
supplemental or emergency reserves) are required to be maintained during such
Interest Period under Regulation D by member banks of the Federal Reserve System
in Boston with deposits exceeding $1,000,000,000 against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting the effect
of the foregoing, the Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks by reason of any Regulatory
Change against (i) any category of liabilities which includes deposits by
reference to which the LIBO Rate for LIBOR Loans is to be determined as provided
in the definition of "LIBO Rate" in this Section 1.1 or (ii) any category of
extensions of credit or other assets which include LIBOR Loans.
"Revolving Credit Termination Date" means June 30, 1999; provided
that if such date is not a Banking Day, the Revolving Credit Termination Date
shall be the next succeeding Banking Day (or, if such next succeeding Banking
Day falls in the next calendar month, the next preceding Banking Day) or (b) the
earlier date of termination of the Commitments pursuant to Section 9.2.
"Security Agreement" means the security agreement dated as of the
Closing Date by the Borrowers in favor of the Bank, in substantially the form of
Exhibit C.
"Senior Funded Debt" means for any Person at any time, all Funded
Debt, other than Subordinated Debt.
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"Senior Liabilities" means for any Person at any time, all Debt,
other than contingent liabilities and Subordinated Debt.
"Sub Debt Agreements" means collectively the agreements dated April
17, 1998 governing the $11,000,000 Subordinated Debt issued to Massachusetts
Mutual Life Insurance Company and certain of its affiliates.
"Subordinated Debt" means Funded Debt of a Person subordinated to
the Loans on terms satisfactory to the Bank.
"$11,000,000 Subordinated Debt" means the Subordinated Debt issued
pursuant to and governed by the Sub Debt Agreements.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which at least a majority of the securities or other ownership
interests having ordinary voting power (absolutely or contingently) for the
election of directors or other persons performing similar functions are at the
time owned directly or indirectly by such Person.
"Tangible Capital Base" means, for any Person, the sum of Tangible
Net Worth plus Subordinated Debt.
"Tangible Net Worth" means, at any date of determination thereof,
the excess of total assets of a Person over total liabilities of such Person,
excluding, however, from the determination of total assets: loans and advances
to officers and non-consolidated Affiliates, goodwill, trademarks, patents,
organizational costs, unamortized debt discounts and expenses and other like
intangible assets as defined by GAAP.
"Term Loan" shall have the meaning set forth in Section 2.1(b)
herein.
"Term Loan Commitment" means the obligation of the Bank to make the
Term Loan under this Agreement in the aggregate principal amount of up to
$12,000,000, as such amount may be reduced or otherwise modified from time to
time.
"Term Note" means the promissory note of the Borrowers in the form
of Exhibit A1 hereto evidencing the Term Loan made by the Bank hereunder and all
promissory notes delivered in substitution or exchange therefor, as amended or
supplemented from time to time.
"Termination Date" means March 31, 2003; provided that if such date
is not a Banking Day, the Termination Date shall be the next succeeding Banking
Date.
"Total Liabilities" means all liabilities of a Person which would be
classified as such on a balance sheet in accordance with GAAP.
"Unfunded Benefit Liabilities" means, with respect to any Plan, the
amount (if any) by which the present value of all benefit liabilities (within
the meaning of section 4001(a)(16) of ERISA) under the Plan exceeds the fair
market value of all Plan assets allocable to such benefit liabilities, as
determined on the most recent valuation date of the Plan and in accordance with
the provisions of ERISA for calculating the potential liability of the Borrowers
or any ERISA Affiliate under Title IV of ERISA.
"Working Capital Commitment" means the obligation of the Bank to
make the Working Capital Loans under this Agreement in the aggregate principal
amount of up to
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$8,000,000, as such amount may be limited or reduced pursuant to Article 2 or
otherwise modified from time.
"Working Capital Loans" shall have the meaning set forth in Section
2.1(a) herein.
"Working Capital Note" means the promissory note of the Borrowers in
the form of Exhibit A2 hereto evidencing the Working Capital Loans made by the
Bank hereunder and all promissory notes delivered in substitution or exchange
therefor, as amended or supplemented from time to time.
Section 1.1. Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, and all financial
data required to be delivered hereunder shall be prepared in accordance with
GAAP.
Section 1.2. Currency Equivalents. For all purposes of this
Agreement, all amounts denominated in a currency other than Dollars shall be
converted into the Dollar equivalent of such amounts. The equivalent in another
currency of an amount in Dollars shall be determined at the rate of exchange
quoted by Fleet National Bank in Boston at 9:00 a.m. (Boston time) on the date
of determination, to prime banks in Boston for the spot purchase in the Boston
foreign exchange market of such amount of Dollars with such other currency.
ARTICLE 2. THE CREDIT
Section 2.1. The Loans.
(a) Subject to the terms and conditions of this Agreement, the
Bank agrees to make revolving loans (the "Working Capital Loans") to the
Borrowers from time to time from and including the date hereof to and including
the Revolving Credit Termination Date, up to but not exceeding in the aggregate
principal amount at any one time outstanding the amount of the Working Capital
Commitment, and provided that the aggregate outstanding principal amount of
Working Capital Loans shall at no time exceed the Borrowing Base. The Working
Capital Loans may be outstanding as Prime Rate Loans or LIBOR Loans (each a
"type" of Loan). The Working Capital Loans shall be due and payable on the
Revolving Credit Termination Date. Each type of Loan shall be made and
maintained at the Bank's Lending Office for such type of Loan. The Bank and the
Borrowers hereby terminate that certain Amended and Restated Credit Agreement
dated as of December 15, 1995, as amended, among Tridex, UTC and the Bank.
(b) Subject to the terms and conditions of this Agreement, the
Bank agrees to make a term loan (the "Term Loan") to the Borrowers on the date
hereof in one advance in the principal amount of $12,000,000. Once so funded,
the Term Loan may be outstanding in full or in part as Prime Rate Loans or LIBOR
Loans (each a "type" of Loan) pursuant to the provisions of this Article 2.
Principal on the Term Loan shall be payable in accordance with the following
amortization schedule:
First Year of Amortization: $300,000 per quarter, payable on
June 30, 1998, September 30, 1998, December 31, 1998 and March
31, 1999.
Second Year of Amortization: $450,000 per quarter, payable on
June 30, 1999, September 30, 1999, December 31, 1999 and March
31, 2000.
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Third Year of Amortization: $750,000 per quarter, payable on
June 30, 2000, September 30, 2000, December 31, 2000 and March
31, 2001.
Fourth Year of Amortization: $750,000 per quarter, payable on
June 30, 2001, September 30, 2001, December 31, 2001 and March
31, 2002.
Fifth Year of Amortization: $750,000 per quarter, payable on
June 30, 2002, September 30, 2002, December 31, 2002 and March
31, 2003.
Each type of Loan shall be made and maintained at the Bank's
Lending Office for such type of Loan.
Section 2.2. The Notes. The Working Capital Loans shall be evidenced
by a promissory note in favor of the Bank in the form of Exhibit A-2, dated the
date of this Agreement, duly completed and executed by the Borrowers. The Term
Loan shall be evidenced by a promissory note in favor of the Bank in the form of
Exhibit A-1, dated the date of this Agreement, duly completed and executed by
the Borrowers.
Section 2.3. Purpose. The Borrowers shall use the proceeds of the
Working Capital Loans for general corporate purposes, including working capital,
leasehold improvements and equipment needs. In addition, up to $3,500,000 of the
proceeds of the Working Capital Loans can be advanced to Tridex NC to fund a
portion of the acquisition purchase price of PSI's stock, provided, however that
in the event the Mass Mutual Transaction closes on or prior to the Closing Date,
the aforesaid $3,500,000 amount will be reduced by the amount of the equity
funds received by Tridex from the Mass Mutual Transaction. The proceeds of the
Term Loan shall also be advanced to Tridex NC to fund a portion of the
acquisition purchase price of PSI's stock. No proceeds of the Loans shall be
used to directly or indirectly fund the needs of any Subsidiary of any Borrower
if such Subsidiary is not also a Borrower hereunder. No proceeds of the Loans
shall be used for the purpose, whether immediate, incidental or ultimate, of
buying or carrying "margin stock" within the meaning of Regulation U.
Section 2.4. Borrowing Procedures. The Borrowers shall give the Bank
notice of each Borrowing to be made hereunder as provided in Section 2.8. Not
later than 1:00 p.m. Hartford, Connecticut time on the date of such Borrowing,
the Bank shall, subject to the conditions of this Agreement, make the amount of
the Loan to be made by it on such day available to the Borrowers, in immediately
available funds, by the Bank crediting an account of the Borrowers designated by
the Borrowers and maintained with the Bank at the Lending Office.
Section 2.5. Prepayments and Conversions.
(a) Optional Prepayments and Conversions. The Borrowers shall
have the right to make prepayments of principal, or to convert one type of Loan
into another type of Loan, at any time or from time to time; provided that: (i)
the Borrowers shall give the Bank notice of each such prepayment or conversion
as provided in Section 2.8; and (ii) LIBOR Loans may be prepaid or converted
only on the last day of an Interest Period for such Loans, unless the Borrowers
compensate the Bank as required pursuant to Section 3.4 herein, and (iii)
prepayments made in respect of the Term Loan shall be applied to the
installments of principal in the inverse order of their maturities.
(b) Mandatory Prepayments. The Borrowers shall immediately
repay the excess by which the aggregate principal amount of all outstanding
Working Capital Loans
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exceeds the Working Capital Commitment. In addition, amounts outstanding under
the Term Loan will be reduced from time to time by an amount equal to 50% of the
annual consolidated Excess Cash Flow of the Borrowers and their subsidiaries.
Payment of such Excess Cash Flow amounts shall be made within 30 days of the
annual audited financial statements prepared on a consolidated basis of the
Borrowers and be applied toward payments under the Term Loan in the inverse
order of their maturities. In addition, 100% of the net cash proceeds from any
sale by any of the Borrowers of any material assets outside of the normal course
of business or from any new issuances of stock (other than pursuant to the Mass
Mutual Transaction) otherwise permitted under this Agreement shall be utilized
by the Borrowers to repay amounts under the Term Loan in the inverse order of
their maturities. In addition, at such time, if any, as the Borrowers shall
consummate the Mass Mutual Transaction, the net proceeds from such transaction
shall first be utilized by the Borrowers to repay amounts outstanding as Working
Capital Loans and thereafter will be utilized to repay amounts outstanding under
the Term Loan in the inverse order of their maturities. In addition, upon the
occurrence of any Change of Control, the Borrowers shall immediately, at the
option of and upon demand by the Bank, repay all outstanding amounts under the
Loans, and such amounts shall be repaid prior to making any payments on any
Subordinated Debt. Each such prepayment in accordance with the foregoing
provisions shall be applied first to any expenses incurred by the Bank, second
to any interest due on the amount prepaid, and last to the outstanding principal
amount of the Loans prepaid, in each case in such manner as provided above.
(c) Yield Maintenance Fee. If, at any time (i) the interest
rate on any Loan is a fixed rate, and (ii) the Bank in its sole discretion
should determine that current market conditions can accommodate a prepayment
request, Borrowers shall have the right at any time and from time to time to
prepay the Loan in whole (but not in part), and Borrowers shall pay to the Bank
a yield maintenance fee in an amount computed as follows: The current rate for
United States Treasury securities (bills on a discounted basis shall be
converted to a bond equivalent) with a maturity date closest to the maturity
date of the term chosen pursuant to the Fixed Rate Election as to which the
prepayment is made, shall be subtracted from the "cost of funds" component of
the fixed rate in effect at the time of prepayment. If the result is zero or a
negative number, there shall be no yield maintenance fee. If the result is a
positive number, then the resulting percentage shall be multiplied by the amount
of the principal balance being prepaid. The resulting amount shall be devided by
360 and multiplied by the number of the days remaining in the term chosen
pursuant to the Fixed Rate Election as to which the prepayment is made. Said
amount shall be reduced to present value calculated by using the number of days
remaining in the designated term and using the above-referenced United States
Treasury security rate and the number of days remaining in the term chosen shall
be the yield maintenance fee due to the Bank upon prepayment of the fixed rate
Loan. Each reference in this paragraph to "Fixed Rate Election" shall mean the
election by Borrowers pursuant to Section 2.11 hereof.
If by reason of an Event of Default the Bank elects to declare
such Loan to be immediately due and payable, then any yield maintenance fee with
respect to the Loan shall become due and payable in the same manner as though
Borrowers had exercised such right of prepayment.
Section 2.6. Late Charges. Payments not received within 10 days of
the due date therefor (including payments which are incomplete due to there
being insufficient funds in the Borrowers' operating accounts at the Bank) will
be subject to a one-time charge equal to 5% of the amount overdue.
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Section 2.7. Changes of Commitment. The Borrowers shall have the
right to reduce or terminate the amount of the unused portion of the Working
Capital Commitment at any time or from time to time, provided that: (i) the
Borrowers shall give notice of each such reduction or termination to the Bank as
provided in Section 2.8; and (ii) each partial reduction shall be in an
aggregate amount at least equal to $500,000 (and integral multiples of $100,000
in excess thereof). Once reduced or terminated, such Working Capital Commitment
may not be reinstated.
Section 2.8. Certain Notices. Notices by the Borrowers to the Bank
of each Borrowing pursuant to Section 2.4, and each prepayment or conversion
pursuant to Section 2.5(a), and each reduction or termination of a Commitment
pursuant to Section 2.7 shall be irrevocable and shall be effective only if
received by the Bank not later than 12:00 noon Hartford, Connecticut time, and
(a) in the case of Borrowings and prepayments of, conversions into and (in the
case of LIBOR Loans) renewals of (i) Prime Rate Loans, given on the Banking Day
thereof;; and (ii) LIBOR Loans, given two Banking Days prior thereto; and (b) in
the case of reductions or termination of the Working Capital Commitment, given
one Banking Day prior thereto. Each such Notice of Borrowing shall be in the
form of Exhibit E hereto and shall specify the Loans to be borrowed, prepaid,
converted or renewed and the amount (subject to Section 2.9) and type of the
Loans to be borrowed, or converted, or renewed or prepaid and the date of the
Borrowing or prepayment, or conversion or renewal (which shall be a Banking
Day). Each such notice of reduction or termination shall specify the amount of
the Commitment to be reduced or terminated.
Section 2.9. Minimum Amounts. Except for Borrowings which exhaust
the full remaining amount of the unused portion of either of the Commitments or
prepayments or conversions which result in the prepayment or conversion of all
Loans, as the case may be, of a particular type, each Borrowing, optional
prepayment, conversion and renewal of principal of Loans of a particular type
shall be in an amount at least equal to (a) $500,000 with respect to Prime Rate
Loans, and (b) $500,000 and integral multiples of $100,000 in excess thereof
with respect to LIBOR Loans (borrowings, prepayments, conversions or renewals of
or into Loans of different types or, in the case of LIBOR Loans, having
different Interest Periods at the same time hereunder to be deemed separate
borrowings, prepayments, conversions and renewals for the purposes of the
foregoing, one for each type of Interest Period).
Section 2.10. Interest.
(a) Interest shall accrue on the outstanding and unpaid
principal amount of each Loan for the period from and including the date of such
Loan to but excluding the date such Loan is due at the following rates per
annum: (i) for Prime Rate Loans, at a variable rate per annum equal to the Prime
Rate plus the Margin and; (ii) for LIBOR Loans, at a fixed rate equal to the
LIBO Rate plus the Margin, for the period from and including the first day of
the Interest Period therefore to but excluding the last day of such Interest
Period. If the principal amount of any Loan and any other amount payable by the
Borrowers hereunder or under the Notes shall not be paid when due (at stated
maturity, by acceleration or otherwise), interest shall accrue on such amount to
the fullest extent permitted by law from and including such due date to but
excluding the date such amount is paid in full at the Default Rate for such type
of Loan.
(b) The interest rate on Prime Rate Loans shall change when
the Prime Rate changes and interest on each such Loan shall be calculated on the
basis of a year of 360 days for the actual number of days elapsed. Interest on
each LIBOR Loan shall be calculated on the basis of a year of 360 days for the
actual number of days elapsed.
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(c) Accrued interest on all types of Loans shall be due and
payable in arrears upon any payment of principal, in arrears on the last day of
any Interest Period and on the last day of each calendar month, commencing May
31, 1998, and, with respect to Working Capital Loans, on the Revolving Credit
Termination Date, and, with respect to the Term Loan, on the Termination Date;
provided that interest accruing at the Default Rate shall be due and payable
from time to time on demand of the Bank.
Section 2.11. Interest Periods; Renewals.
(a) In the case of each LIBOR Loan, the Borrowers shall select
an Interest Period of any duration in accordance with the definition of Interest
Period in Section 1.1, subject to the following limitations: (i) no Interest
Period may extend beyond the Revolving Credit Termination Date, except with
respect to the Term Loan for which no Interest Period may extend beyond an
Amortization Date unless, after giving effect thereto, the aggregate principal
amount of the LIBOR Loans having Interest Periods which end after such
Amortization Date shall be equal to or less than the principal amount to be
outstanding hereunder after such Amortization Date; (iii) notwithstanding
clauses (i) and (ii) above, no Interest Period shall have a duration less than
one month, and if any such proposed Interest Period would otherwise be for a
shorter period, such Interest Period shall not be available; (iv) if an Interest
Period would end on a day which is not a Banking Day, such Interest Period shall
be extended to the next Banking Day; and (v) no more than five Interest Periods
may be outstanding at any one time in respect of either the Term Loan or the
Working Capital Loans.
(b) Upon notice to the Bank as provided in Section 2.8, the
Borrowers may renew any LIBOR Loan on the last day of the Interest Period
therefor as the same type of Loan with an Interest Period of the same or
different duration in accordance with the limitations provided above. If the
Borrowers shall fail to give notice to the Bank of such a renewal, such LIBOR
Loan shall automatically become a Prime Rate Loan on the last day of the current
Interest Period.
Section 2.12. Fees.
(a) Commitment Fee. During the period ending on the Revolving
Credit Termination Date, there will be a per annum commitment fee payable on the
average unused daily availability under the Working Capital Commitment, payable
quarterly in arrears on the first Banking Day after the end of each quarter and
calculated on a 360 day year for actual days elapsed. The commitment fee rate
will vary based on the then prevailing ratio of consolidated Senior Funded Debt
to EBITDA of the Borrowers (the applicable ratio for such quarter will be the
ratio determined as of the last day of the previous quarter for the twelve month
period then ended), as follows:
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Senior Funded Debt/EBITDA
of the Borrowers Commitment Fee
---------------- --------------
Greater than or equal to 3.00 0.625%
Less than 3.00, but greater than or equal to 2.00 0.50%
Less than 2.00, but greater than or equal to 1.00 0.375%
Less than 1.00 0.25%
(b) Facility Fees. The Borrowers shall pay to the Bank, on the
Closing Date, a $45,000 upfront facility fee for the Working Capital Loans. In
addition, the Borrowers shall pay to the Bank, on the Closing Date, a $45,000
upfront facility fee for the Term Loan.
Section 1.13. Payments Generally. All payments under this Agreement
or the Notes shall be made in Dollars in immediately available funds not later
than 1:00 p.m. Hartford, Connecticut, time on the relevant dates specified above
(each such payment made after such time on such due date to be deemed to have
been made on the next succeeding Banking Day) at the Lending Office of the Bank.
The Bank may (but shall not be obligated to) debit the amount of any such
payment which is not made by such time to any ordinary deposit account of the
Borrowers with the Bank. Until the Bank and the Borrowers otherwise agree, the
Bank shall debit the Borrowers' account number 0000000000 with the Bank for the
amount of any payment required hereunder, but the Bank may also debit any
ordinary deposit account of the Borrowers if the amount in account number
0000000000 is insufficient to make any required payment. The Borrowers shall, at
the time of making each payment under this Agreement or the Notes, specify to
the Bank the principal or other amount payable by the Borrowers under this
Agreement or the Note to which such payment is to be applied (and in the event
that it fails to so specify, or if a Default or Event of Default has occurred
and is continuing, the Bank may apply such payment as it may elect in its sole
discretion). If the due date of any payment under this Agreement or the Notes
would otherwise fall on a day which is not a Banking Day, such date shall be
extended to the next succeeding Banking Day and interest shall be payable for
any principal so extended for the period of such extension.
ARTICLE 3. YIELD PROTECTION; ILLEGALITY; ETC.
Section 3.1. Additional Costs.
(a) The Borrowers shall pay to the Bank from time to time on
demand such amounts as the Bank may determine to be necessary to compensate it
for any costs which the Bank determines are attributable to its making or
maintaining any LIBOR Loans under this Agreement or the Notes or its obligation
to make any such Loans hereunder, or any reduction in any amount receivable by
the Bank hereunder in respect of any such Loans or such obligation (such
increases in costs and reductions in amounts receivable being herein called
"Additional Costs"), resulting from any Regulatory Change which: (i) changes the
basis of taxation of any amounts payable to the Bank under this Agreement or the
Notes in respect of any of such Loans (other than taxes imposed on the overall
net income of the Bank or of its Lending Office for any of such Loans by the
jurisdiction in which the Principal Office or such Lending Office is located);
or (ii) imposes or modifies any reserve, special deposit, deposit insurance or
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assessment, minimum capital, capital ratio or similar requirements relating to
any extensions of credit or other assets of, or any deposits with or other
liabilities of, the Bank (including any of such Loans or any deposits referred
to in the definition of "LIBO Rate" in Section 1.1); or (iii) imposes any other
condition affecting this Agreement or the Notes (or any of such extensions of
credit or liabilities). The Bank will notify the Borrowers of any event
occurring after the date of this Agreement which will entitle the Bank to
compensation pursuant to this Section 3.1(a) as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation.
(b) Without limiting the effect of the foregoing provisions of
this Section 3.1, in the event that, by reason of any Regulatory Change, the
Bank either (i) incurs Additional Costs based on or measured by the excess above
a specified level of the amount of a category of deposits or other liabilities
of the Bank which includes deposits by reference to which the interest rate on
LIBOR Loans is determined as provided in this Agreement or a category of
extensions of credit or other assets of the Bank which includes LIBOR Loans or
(ii) becomes subject to restrictions on the amount of such a category of
liabilities or assets which it may hold, then, if the Bank so elects by notice
to the Borrowers, the obligation of the Bank to make or renew, and to convert
Loans of any other type into, Loans of such type hereunder shall be suspended
until the date such Regulatory Change ceases to be in effect, and the Borrowers
shall on the last day(s) of the then current Interest Period(s) for the
outstanding Loans of such type, either prepay such Loans or convert such Loans
into another type of Loan in accordance with Section 2.5.
(c) Without limiting the effect of the foregoing provisions of
this Section 3.1 (but without duplication), the Borrowers shall pay to the Bank
from time to time on request such amounts as the Bank may determine to be
necessary to compensate the Bank for any costs which it determines are
attributable to the maintenance by it or any of its affiliates pursuant to any
law or regulation of any jurisdiction or any interpretation, directive or
request (whether or not having the force of law and whether in effect on the
date of this Agreement or thereafter) of any court or governmental or monetary
authority of capital in respect of its Loans hereunder or its obligation to make
Loans hereunder (such compensation to include, without limitation, an amount
equal to any reduction in return on assets or equity of the Bank to a level
below that which it could have achieved but for such law, regulation,
interpretation, directive or request). The Bank will notify the Borrowers if it
is entitled to compensation pursuant to this Section 3.1(c) as promptly as
practicable after it determines to request such compensation.
(d) Determinations and allocations by the Bank for purposes of
this Section 3.1 of the effect of any Regulatory Change pursuant to subsections
(a) or (b), or of the effect of capital maintained pursuant to subsection (c),
on its costs of making or maintaining Loans or its obligation to make Loans, or
on amounts receivable by, or the rate of return to, it in respect of Loans or
such obligation, and of the additional amounts required to compensate the Bank
under this Section 3.1, shall be conclusive, provided that such determinations
and allocations are made on a reasonable basis; provided, however, that the Bank
shall provide ninety days' notice of any additional amounts required to
compensate the Bank under this Section 3.1 (the "Adjustment"), and the Borrowers
may thereafter attempt to negotiate the amount of the Adjustment in good faith
with the Bank within ninety days of the day on which the Borrowers are so
notified. If the Borrowers and the Bank are unable to agree on the amount of the
Adjustment within such ninety-day period, then the amount of the Adjustment
shall be the amount set forth in the aforementioned notice from the Bank to the
Borrowers. Whatever the final Adjustment may be, if the Bank shall still have
any Loans outstanding to the Borrowers
162
upon the expiration of such ninety-day period, then the Adjustment shall be
effective retroactive to the date on which the Borrowers first received notice
of the Adjustment. The Bank shall not be obligated to offer LIBO Rates with
respect to Interest Periods commencing during the period following any such
notice and prior to agreement by the Bank and the Borrowers as to the amount of
the Adjustment.
Section 3.2. Limitation on Types of Loans. Anything herein to the
contrary notwithstanding, if the Bank determines (which determination shall be
conclusive) that:
(a) quotations of interest rates for the relevant deposits
referred to in the definition of "LIBO Rate" in Section 1.1 are not being
provided in the relevant amounts or for the relevant maturities for purposes of
determining the rate of interest for any LIBOR Loans as provided in this
Agreement; or
(b) the relevant rates of interest referred to in the
definition of "LIBO Rate" in Section 1.1 upon the basis of which the rate of
interest for any LIBOR Loans is to be determined do not adequately cover the
cost to the Bank of making or maintaining such Loans; then the Bank shall give
the Borrowers prompt notice thereof, and so long as such condition remains in
effect, the Bank shall be under no obligation to make or renew Loans of such
type or to convert Loans of any other type into Loans of such type and the
Borrowers shall, on the last day(s) of the then current Interest Period(s) for
the outstanding Loans of the affected type, either prepay such Loans or convert
such Loans into another type of Loans in accordance with Section 2.5.
Section 3.3. Illegality. Notwithstanding any other provision in this
Agreement, in the event that it becomes unlawful for the Bank or its Lending
Office to (a) honor its obligation to make or renew LIBOR Loans hereunder or
convert Loans of any type into Loans of such type, or (b) maintain LIBOR Loans
hereunder, then the Bank shall promptly notify the Borrowers thereof and the
Bank's obligation to make or renew LIBOR Loans and to convert other types of
Loans into Loans of such type hereunder shall be suspended until such time as
the Bank may again make, renew or convert and maintain such affected Loans and
the Borrowers shall, on the last day(s) of the then current Interest Period for
the outstanding LIBOR Loans, as the case may be (or on such earlier date as the
Bank may specify to the Borrowers), either prepay such Loans or convert such
Loans into another type of Loans in accordance with Section 2.5.
Section 3.4. Certain Compensation. The Borrowers shall pay to the
Bank, upon the request of the Bank, such amount or amounts as shall be
sufficient (in the reasonable opinion of the Bank) to compensate it for any
loss, cost or expense which the Bank determines is attributable to:
(a) any payment, prepayment, conversion or renewal of a LIBOR
Loan on a date other than the last day of an Interest Period for such Loan
(whether by reason of acceleration or otherwise); or
(b) any failure by the Borrowers to borrow, convert into or
renew a LIBOR Loan to be made, converted into or renewed by the Bank on the date
specified therefor in the relevant notice under Section 2.4, 2.5 or 2.11, as the
case may be.
Without limiting the foregoing, such compensation shall include an amount
equal to the excess, if any, of: (i) the amount of interest which otherwise
would have accrued on the principal amount so paid, prepaid, converted or
renewed or not borrowed, converted or renewed for the
163
period from and including the date of such payment, prepayment or conversion or
failure to borrow, convert or renew to but excluding the last day of the then
current Interest Period for such Loan (or, in the case of a failure to borrow,
convert or renew, to but excluding the last day of the Interest Period for such
Loan which would have commenced on the date specified therefor in the relevant
notice) at the applicable rate of interest for such Loan provided for herein;
over (ii) with respect to a LIBOR Loan, the amount of interest (as reasonably
determined by the Bank) the Bank would have bid in the London interbank market
for Dollar deposits for amounts comparable to such principal amount and
maturities comparable to such period. A determination of the Bank as to the
amounts payable pursuant to this Section 3.4 shall be conclusive absent manifest
error.
ARTICLE 4. CONDITIONS PRECEDENT
Section 4.1. Documentary Conditions Precedent. The obligation of the
Bank to make the Loans is subject to the conditions precedent that the Bank
shall have received on or before the date of such Borrowing each of the
following, in form and substance satisfactory to the Bank and its counsel:
(a) the Notes duly executed by the Borrowers;
(b) the Security Agreement duly executed by the Borrowers,
together with (i) acknowledgment copies of the financing statements (UCC-1) duly
filed under the Uniform Commercial Code of all jurisdictions necessary or, in
the opinion of the Bank, desirable to perfect the security interest created by
the Security Agreement; (ii) certified copies of requests for information (Form
UCC-11) identifying all of the financing statements on file with respect to the
Borrowers in all jurisdictions referred to under (i), including the financing
statements filed by the Bank against the Borrowers, indicating that no party
claims an interest in any of the Collateral (as defined in the Security
Agreement);
(c) a certificate of the Secretary or Assistant Secretary of
each Borrower, dated the Closing Date, attesting to all corporate action taken
by such Borrower, including resolutions of its Board of Directors authorizing
the execution, delivery and performance of the Facility Documents to which it is
a party and each other document to be delivered pursuant to this Agreement and
certifying copies of the Certificate of Incorporation and by-laws of such
Borrower;
(d) a certificate of the Secretary or Assistant Secretary of
each Borrower, dated the Closing Date, certifying the names and true signatures
of the officers of such Borrower authorized to sign the Facility Documents to
which it is a party and the other documents to be delivered by such Borrower
under this Agreement;
(e) a certificate of a duly authorized officer of each
Borrower, dated the Closing Date, stating that the representations and
warranties in Article 5 of this Agreement, and Article 2 of the Security
Agreement, and in each other Facility Document, are true and correct on such
date as though made on and as of such date and that no event has occurred and is
continuing which constitutes a Default or Event of Default;
(f) an Environmental Indemnification Agreement duly signed by
the Borrowers in form and substance satisfactory to the Bank;
164
(g) a certificate of good standing for each Borrower from the
Secretary of the State of the state in which such Borrower is incorporated and
each other jurisdiction in which such Borrower is qualified to do business;
(h) payment by the Borrowers to the Bank of the facility fees
as required by Section 2.12(b), and all other expenses and fees incurred by the
Bank;
(i) a favorable opinion of counsel for the Borrowers, dated
the Closing Date, in form and substance satisfactory to the Bank;
(j) copies of all instruments evidencing any Subordinated Debt
of any Borrower and a satisfactory review of the same;
(k) evidence of the acquisition by Tridex of PSI on terms
satisfactory to the Bank in all respects;
(l) evidence of the issuance by Tridex of 714,000 shares stock
of Tridex to Xxxx Xxxxx, representing $5,000,000 of the acquisition purchase
price of PSI's stock;
(m) evidence of successful placement by Tridex of at least
$11,000,000 of the Subordinated Debt relating to the acquisition of PSI stock,
with a current cash coupon interest rate of no greater than 12% (plus deferred
interest or PIK of not greater than 7%), with a bank or other institutional
lender;
(n) evidence of payment by Tridex to Xxxx Xxxxx of $16,100,000
from available cash, representing a portion of the purchase price of PSI's
stock;
(o) delivery to the Bank of year 2000 compliance forms
satisfactory to the Bank in all respects;
(p) delivery to the Bank of year-end audited financial
statements for both Tridex (consolidated) and PSI showing no material variations
from the draft financial statements previously supplied by the Borrowers to the
Bank;
(q) evidence of no material adverse change in the business,
management, operations, properties, prospects or condition (financial or
otherwise) of any Borrower or any of their respective Subsidiaries since the
date of the commitment letter;
(r) evidence of liability and property insurance of the
Borrowers satisfactory to the Bank, with suitable endorsements naming the Bank
as loss payee;
(s) a Borrowing Base Certificate and a recent receivables and
inventory aging satisfactory to the Bank;
(t) fair value Balance Sheets for each of the Borrowers; and
(u) evidence of the absence of any change in market conditions
which, in the Bank's opinion, would materially impair a financial institution's
ability to fund Loans of this type.
Section 4.2. Additional Conditions Precedent. The obligation of the
Bank to make the Loans pursuant to a Borrowing which increases the amount
outstanding hereunder
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(including the initial Borrowing) shall be subject to the further conditions
precedent that on the date of such Borrowing:
(a) the following statements shall be true:
(i) the representations and warranties contained in
Article 5 herein, and in Article 2 of the Security Agreement, and in each other
Facility Document, are true and correct on and as of the date of such Loan as
though made on and as of such date; and
(ii) no Default or Event of Default has occurred and is
continuing, or would result from such Loan; and
(iii) there has been no material adverse change in the
business, management, operations, properties, prospects or condition (financial
or otherwise) of any Borrower or any of their respective Subsidiaries since the
Closing Date;
(b) the Bank shall have received such approvals, opinions or
documents as the Bank may reasonably request; and
(c) the Bank shall have received a current Borrowing Base
Certificate.
Section 4.3. Deemed Representations. Each Notice of Borrowing
hereunder and acceptance by any Borrower of the proceeds of such Borrowing shall
constitute a representation and warranty that the statements contained in
Section 4.2(a) are true and correct both on the date of such notice and, unless
any Borrower otherwise notifies the Bank prior to such Borrowing, as of the date
of such Borrowing.
ARTICLE 5. REPRESENTATIONS AND WARRANTIES
Each Borrower hereby represents and warrants that:
Section 5.1. Incorporation, Good Standing and Due Qualification.
Each of such Borrowers and its Subsidiaries is duly incorporated, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its assets and to
transact the business in which it is now engaged or proposed to be engaged, and
is duly qualified as a foreign corporation and in good standing under the laws
of each other jurisdiction in which such qualification is required.
Section 5.2. Corporate Power and Authority; No Conflicts. The
execution, delivery and performance by such Borrower of the Facility Documents
to which it is a party have been duly authorized by all necessary corporate
action and do not and will not: (a) require any consent or approval of its
stockholders; (b) contravene its charter or by-laws; (c) violate any provision
of, or require any filing (other than the filing of the financing statements
contemplated by the Security Agreement), registration, consent or approval
under, any law, rule, regulation (including, without limitation, Regulation U),
order, writ, judgment, injunction, decree, determination or award presently in
effect having applicability to such Borrower or any of its Subsidiaries or
Affiliates; (d) result in a breach of or constitute a default or require any
consent under any indenture or loan or credit agreement or any other agreement,
lease or instrument to which such Borrower is a party or by which it or its
properties may be bound or affected; (e) result in, or require, the creation or
imposition of any Lien (other than as created under the Security Agreement),
upon or with respect to any of the properties now owned or hereafter acquired by
such Borrower; or (f) cause such Borrower (or any Subsidiary or Affiliate, as
the
166
case may be) to be in default under any such law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award or any such
indenture, agreement, lease or instrument.
Section 5.3. Legally Enforceable Agreements. Each Facility Document
to which such Borrower is a party is, or when delivered under this Agreement
will be, a legal, valid and binding obligation of such Borrower enforceable
against such Borrower in accordance with its terms, except to the extent that
such enforcement may be limited by applicable bankruptcy, insolvency and other
similar laws affecting creditors' rights generally.
Section 5.4. Litigation. Except as set forth on Schedule 5.4, there
are no actions, suits or proceedings pending or, to the knowledge of such
Borrower, threatened, against or affecting such Borrower or any of its
Subsidiaries before any court, governmental agency or arbitrator, which may, in
any one case or in the aggregate, materially adversely affect the financial
condition, operations, properties or business of such Borrower or any such
Subsidiary or of or the ability of such Borrower to perform its obligation under
the Facility Documents to which it is a party.
Section 5.5. Financial Statements. The consolidated and
consolidating balance sheet of such Borrower and its Consolidated Subsidiaries
as at December 31, 1997, and the related consolidated and consolidating income
statement and statements of cash flows and changes in stockholders' equity of
such Borrower and its Consolidated Subsidiaries for the fiscal year then ended,
and the accompanying footnotes, together with the opinion thereon as to the
consolidated statements, of Price Waterhouse, independent certified public
accountants, copies of which have been furnished to the Bank, are complete and
correct and fairly present the financial condition of such Borrower and its
Consolidated Subsidiaries as at such dates and the results of the operations of
such Borrower and its Consolidated Subsidiaries for the periods covered by such
statements, all in accordance with GAAP consistently applied (subject to
year-end adjustments in the case of the interim financial statements). There are
no liabilities of such Borrower or any of its Consolidated Subsidiaries, fixed
or contingent, which are material but are not reflected in the financial
statements or in the notes thereto, other than liabilities arising in the
ordinary course of business since December 31, 1997. No information, exhibit or
report furnished by such Borrower to the Bank in connection with the negotiation
of this Agreement contained any material misstatement of fact or omitted to
state a material fact or any fact necessary to make the statement contained
therein not materially misleading. Since December 31, 1997, there has been no
material adverse change in the condition (financial or otherwise), business,
operations or prospects of such Borrower or any of its Subsidiaries.
Section 5.6. Ownership and Liens. Such Borrower and each of its
Consolidated Subsidiaries has title to, or valid leasehold interests in, all of
its properties and assets, real and personal, including the properties and
assets, and leasehold interests reflected in the financial statements referred
to in Section 5.5 (other than any properties or assets disposed of in the
ordinary course of business), and none of the properties and assets owned by
such Borrower or any of its Subsidiaries and none of its leasehold interests is
subject to any Lien, except as disclosed in such financial statements or as may
be permitted hereunder and except for the Lien created by the Security
Agreement.
Section 5.7. Taxes. Except as set forth on Schedule 5.7, such
Borrower and each of its Subsidiaries has filed all tax returns (federal, state
and local) required to be filed and has paid all taxes, assessments and
governmental charges and levies thereon to be due, including interests and
penalties.
167
Section 5.8. ERISA. Each Plan, and, to the best knowledge of such
Borrower, each Multiemployer Plan, is in compliance in all material respects
with, and has been administered in all material respects in compliance with, the
applicable provisions of ERISA, the Code and any other applicable federal or
state law, and no event or condition is occurring or exists concerning which
such Borrower would be under an obligation to furnish a report to the Bank in
accordance with Section 6.8(k) hereof. As of the most recent valuation date for
each Plan, each Plan was "fully funded," which for purposes of this Section 5.8
shall mean that the fair market value of the assets of the Plan is not less than
the present value of the accrued benefits of all participants in the Plan,
computed on a Plan termination basis. To the best knowledge of such Borrower, no
Plan has ceased being fully funded as of the date these representations are made
with respect to any Loan under this Agreement.
Section 5.9. Subsidiaries and Ownership of Stock. Schedule 5.9 is a
complete and accurate list of the Subsidiaries of such Borrower, showing the
jurisdiction of incorporation or organization of each Subsidiary and showing the
percentage of such Borrower's ownership of the outstanding stock or other
interest of each such Subsidiary. All of the outstanding capital stock or other
interest of each such Subsidiary has been validly issued, is fully paid and
nonassessable and is owned by such Borrower free and clear of all Liens.
Section 5.10. Credit Arrangements. Schedule 5.10 is a complete and
correct list of all credit agreements, indentures, purchase agreements,
guaranties, Capital Leases and other investments, agreements and arrangements
presently in effect providing for or relating to extensions of credit (including
agreements and arrangements for the issuance of letters of credit or for
acceptance financing) in respect of which such Borrower or any of its
Subsidiaries is in any manner directly or contingently obligated; and the
maximum principal or face amounts of the credit in question, outstanding and
which can be outstanding, are correctly stated, and all Liens of any nature
given or agreed to be given as security therefor are correctly described or
indicated in such Schedule.
Section 5.11. Operation of Business. Such Borrower and each of its
Subsidiaries possesses all licenses, permits, franchises, patents, copyrights,
trademarks and trade names, or rights thereto, to conduct its business
substantially as now conducted and as presently proposed to be conducted, and
neither such Borrower nor any of its Subsidiaries is in violation of any valid
rights of others with respect to any of the foregoing.
Section 5.12. Hazardous Materials. Such Borrower and each of its
Subsidiaries have 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 the consolidated financial condition, operations, business or
prospects of such Borrower and its Consolidated Subsidiaries. Such Borrower and
each of its Subsidiaries are in compliance with the terms and conditions of all
such permits, licenses and authorizations, and are 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 the consolidated financial condition, operations, business or
prospects of such Borrower and its Consolidated Subsidiaries.
In addition, except as set forth in Schedule 5.12 hereto:
168
(a) 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 such Borrower or any of its Subsidiaries to have any permit, license
or authorization required in connection with the conduct of the business of such
Borrower or any of its Subsidiaries or with respect to any generation,
treatment, storage, recycling, transportation, release or disposal, or any
release as defined in 42 U.S.C. s/s 9601(22) ("Release") of any substance
regulated under Environmental Laws ("Hazardous Materials") generated by such
Borrower or any of its Subsidiaries.
(b) Neither such Borrower nor any of its Subsidiaries has
handled any Hazardous Material, other than as a generator, on any property now
or previously owned or leased by such Borrower or any of its Subsidiaries to an
extent that it has, or may reasonably be expected to have, a material adverse
effect on the consolidated financial condition, operations, business or
prospects taken as a whole of the Borrowers and their Consolidated Subsidiaries;
and
(i) to the best of its knowledge, no PCB is or has been
present at any property now or previously owned or leased by such Borrower or
any of its Subsidiaries;
(ii) to the best of its knowledge, no asbestos is or has
been present at any property now or previously owned or leased by such Borrower
or any of its Subsidiaries;
(iii) there are no underground storage tanks for
Hazardous Materials, active or abandoned, at any property now or previously
owned or leased by such Borrower or any of its Subsidiaries;
(iv) no Hazardous Materials have been Released, in a
reportable quantity, where such a quantity has been established by statute,
ordinance, rule, regulation or order, at, on or under any property now or
previously owned by such Borrower or any of its Subsidiaries.
(c) Neither such Borrower nor any of its Subsidiaries has
transported or arranged for the transportation of any Hazardous Material to any
location which is listed on the National Priorities List under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
("CERCLA"), listed for possible inclusion on the National Priorities List by the
Environmental Protection Agency in the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLIS") or on any similar state or
foreign list or which is the subject of federal, state, foreign or local
enforcement actions or other investigations which may lead to claims against
such Borrower or any of its Subsidiaries for clean-up costs, remedial work,
damages to natural resources or for personal injury claims, including, but not
limited to, claims under CERCLA.
(d) No Hazardous Material generated by such Borrower or any of
its Subsidiaries has been recycled, treated, stored, disposed of or Released by
such Borrower or any of its Subsidiaries at any location other than those listed
in Schedule 5.12 hereto.
(e) No oral or written notification of a Release of a
Hazardous Material has been filed by or on behalf of such Borrower or any of its
Subsidiaries and no property now or previously owned or leased by such Borrower
or any of its Subsidiaries is listed or proposed for
169
listing on the National Priority List promulgated pursuant to CERCLA, on CERCLIS
or on any similar state or foreign list of sites requiring investigation or
clean-up.
(f) There are no Liens arising under or pursuant to any
Environmental Laws on any of the real property or properties owned or leased by
such Borrower or any of its Subsidiaries, and no government actions have been
taken or are in process which could subject any of such properties to such Liens
and neither such Borrower nor any of its Subsidiaries 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.
(g) There have been no environmental investigations, studies,
audits, tests, reviews or other analyses conducted by or which are in the
possession of such Borrower or any of its Subsidiaries in relation to any
property or facility now or previously owned or leased by such Borrower or any
of its Subsidiaries which have not been made available to the Bank.
Section 5.13. No Default on Outstanding Judgments or Orders. Such
Borrower and each of its Subsidiaries has satisfied all judgments and neither
such Borrower nor any of its Subsidiaries is in default with respect to any
judgment, writ, injunction, decree, rule or regulation of any court, arbitrator
or federal, state, municipal or other governmental authority, commission, board,
bureau, agency or instrumentality, domestic or foreign.
Section 5.14. No Defaults on Other Agreements. Neither such Borrower
nor any of its Subsidiaries is a party to any indenture, loan or credit
agreement or any lease or other agreement or instrument or subject to any
charter or corporate restriction which could have a material adverse effect on
the business, properties, assets, operations or conditions, financial or
otherwise, of such Borrower or any of its Subsidiaries, or the ability of such
Borrower to carry out its obligations under the Facility Documents to which it
is a party. Neither such Borrower nor any of its Subsidiaries is in default in
any respect in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any agreement or instrument
material to its business to which it is a party.
Section 5.15. Labor Disputes and Acts of God. Neither the business
nor the properties of such Borrower or of any of its Subsidiaries are affected
by any fire, explosion, accident, strike, lockout or other labor dispute,
drought, storm, hail, earthquake, embargo, act of God or of the public enemy or
other casualty (whether or not covered by insurance), materially and adversely
affecting such business or properties or the operation of such Borrower or such
Subsidiary.
Section 5.16. Governmental Regulation. Neither such Borrower nor any
of its Subsidiaries is subject to regulation under the Public Utility Holding
Company Act of 1935, the Investment Company Act of 1940, the Interstate Commerce
Act, the Federal Power Act or any statute or regulation limiting its ability to
incur indebtedness for money borrowed as contemplated hereby.
Section 5.17. Partnerships. Neither such Borrower nor any of its
Subsidiaries is a partner in any partnership.
Section 5.18. No Forfeiture. Neither such Borrower nor any of its
Subsidiaries or Affiliates is engaged in or proposes to be engaged in the
conduct of any business or activity which could result in a Forfeiture
Proceeding and no Forfeiture Proceeding against any of them is pending or
threatened.
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Section 5.19. Solvency.
(a) The present fair salable value of the assets of such
Borrower after giving effect to all the transactions contemplated by the
Facility Documents and the funding of all Commitments hereunder exceeds the
amount that will be required to be paid on or in respect of the existing debts
and other liabilities (including contingent liabilities) of such Borrower and
its Subsidiaries as they mature.
(b) The property of such Borrower does not constitute
unreasonably small capital for such Borrower to carry out its business as now
conducted and as proposed to be conducted, including the capital needs of such
Borrower.
(c) Such Borrower does not intend to, nor does it believe that
it will, incur debts beyond its ability to pay such debts as they mature (taking
into account the timing and amounts of cash to be received by such Borrower, and
of amounts to be payable on or in respect of debt of such Borrower). The cash
available to such Borrower, after taking into account all other anticipated uses
of the cash of such Borrower, is anticipated to be sufficient to pay all such
amounts on or in respect of debt of such Borrower when such amounts are required
to be paid.
(d) Such Borrower does not believe that final judgments
against it in actions for money damages will be rendered at a time when, or in
an amount such that, such Borrower will be unable to satisfy any such judgments
promptly in accordance with their terms (taking into account the maximum
reasonable amount of such judgments in any such actions and the earliest
reasonable time at which such judgments might be rendered). The cash available
to such Borrower after taking into account all other anticipated uses of the
cash of such Borrower (including the payments on or in respect of debt referred
to in paragraph (c) of this Section 5.19), is anticipated to be sufficient to
pay all such judgments promptly in accordance with their terms.
ARTICLE 6. AFFIRMATIVE COVENANTS
So long as either of the Notes shall remain unpaid or the Bank shall
have either of the Commitments under this Agreement, the Borrowers shall:
Section 6.1. Maintenance of Existence. Preserve and maintain, and
cause each of their respective Subsidiaries to preserve and maintain, their
corporate existence and good standing in the jurisdiction of their
incorporation, and qualify and remain qualified, and cause each of their
respective Subsidiaries to qualify and remain qualified, as a foreign
corporation in each jurisdiction in which such qualification is required.
Section 6.2. Conduct of Business. Continue, and cause each of their
respective Subsidiaries to continue, to engage in an efficient and economical
manner in a business of the same general type as conducted by it on the date of
this Agreement.
Section 6.3. Maintenance of Properties. Maintain, keep and preserve,
and cause each of their respective Subsidiaries to maintain, keep and preserve,
all of their properties (tangible and intangible), necessary or useful in the
proper conduct of their business in good working order and condition, ordinary
wear and tear excepted.
Section 6.4. Maintenance of Records. Keep, and cause each of their
respective Subsidiaries to keep, adequate records and books of account, in which
complete entries will be
171
made in accordance with GAAP, reflecting all financial transactions of the
Borrowers and their respective Subsidiaries.
Section 6.5. Maintenance of Insurance. Maintain, and cause each of
their respective Subsidiaries to maintain, insurance with financially sound and
reputable insurance companies or associations in such amounts and covering such
risks as are usually carried by companies engaged in the same or similar
business and similarly situated, which insurance may provide for reasonable
deductibility from coverage thereof.
Section 6.6. Compliance with Laws. Comply, and cause each of their
respective Subsidiaries to comply, in all respects with all applicable laws,
rules, regulations and orders, such compliance to include, without limitation,
paying before the same become delinquent all taxes, assessments and governmental
charges imposed upon it or upon its property.
Section 6.7. Right of Inspection. At any reasonable time and from
time to time, permit the Bank or any agent or representative thereof, to examine
and make copies and abstracts from the records and books of account of, and
visit the properties of, the Borrowers and any of their respective Subsidiaries,
and to discuss the affairs, finances and accounts of the Borrowers and any such
Subsidiary with any of its officers and directors and the Borrowers' independent
accountants.
Section 6.8. Reporting Requirements. Furnish to the Bank:
(a) as soon as available and in any event within 120 days
after the end of each fiscal year of the Borrowers, a consolidated and
consolidating balance sheet of the Borrowers and their respective Consolidated
Subsidiaries as of the end of such fiscal year and a consolidated and
consolidating income statement and statements of cash flows and changes in
stockholders' equity and working capital of the Borrowers and their respective
Consolidated Subsidiaries for such fiscal year, all in reasonable detail and
stating in comparative form the respective consolidated and consolidating
figures for the corresponding date and period in the prior fiscal year and all
prepared in accordance with GAAP and as to the consolidated statements
accompanied by an opinion thereon acceptable to the Bank by Price Waterhouse or
other independent accountants of national standing selected by the Borrowers;
(b) as soon as available and in any event within 60 days after
the end of the first fiscal quarters of Tridex, a true and complete copy of
Tridex's Report on Form 10-Q;
(c) as soon as available and in any event within 60 days after
the end of each fiscal quarter, a consolidating balance sheet of the Borrowers
and their respective Consolidated Subsidiaries as of the end of such month and a
consolidating income statement and statements of cash flows and changes in
stockholders' equity and working capital, of the Borrowers and their respective
Consolidated Subsidiaries for the period commencing at the end of the previous
fiscal year and ending with the end of such month, all in reasonable detail and
stating in comparative form the consolidating figures for the corresponding date
and period in the previous fiscal year and all prepared in accordance with GAAP
and certified by the President or Chief Financial Officer of each Borrower
(subject to year-end adjustments);
(d) promptly upon receipt thereof, copies of any reports,
inclusive of any management letters, submitted to any Borrower or any of its
Subsidiaries by independent certified public accountants in connection with
examination of the financial statements of such Borrower or any such Subsidiary
made by such accountants;
172
(e) promptly at the end of each fiscal quarter, a certificate
of the President or Chief Financial Officer of each Borrower (i) certifying that
to the best of his knowledge no Default or Event of Default has occurred and is
continuing or, if a Default or Event of Default has occurred and is continuing,
a statement as to the nature thereof and the action which is proposed to be
taken with respect thereto, and (ii) with computations demonstrating compliance
with the covenants contained in Articles 7 and 8;
(f) as soon as available and in any event within 120 days
after the end of each fiscal year of Tridex, a true and complete copy of
Tridex's Report on Form 10-K;
(g) within 30 days after the Closing Date, and thereafter, as
soon as available and in any event within 120 days after the end of each fiscal
year of the Borrowers, management's projected financial statements inclusive of
a balance sheet, an income statement and a statement of cash flow (supported by
key assumptions) for each upcoming fiscal year, prepared on a quarterly basis
for such year;
(h) simultaneously with the delivery of the projected
financial statements referred to in Section 6.8( g), a copy of the Borrowers'
business plan for each upcoming fiscal year;
(i) simultaneously with the delivery of the annual financial
statements referred to in Section 6.8( a), a certificate of the independent
public accountants who audited such statements to the effect that, in making the
examination necessary for the audit of such statements, they have obtained no
knowledge of any condition or event which constitutes a Default or Event of
Default, or if such accountants shall have obtained knowledge of any such
condition or event, specifying in such certificate each such condition or event
of which they have knowledge and the nature and status thereof;
(j) promptly after the commencement thereof, notice of all
actions, suits and proceedings before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
affecting any Borrower or any of its Subsidiaries which, if determined adversely
to such Borrower or such Subsidiary, could have a material adverse effect on the
financial condition, properties or operations of such Borrower or such
Subsidiary;
(k) as soon as possible and in any event within five days
after the Borrower's awareness of the occurrence of each Default or Event of
Default, or after the awareness by any Borrower of the violation of any covenant
in any Facility Document, a written notice setting forth the details of such
Default or Event of Default or such violation and the action which is proposed
to be taken by any Borrower with respect thereto;
(l) as soon as possible, and in any event within ten days
after any Borrower knows or has reason to know that any of the events or
conditions specified below with respect to any Plan or Multiemployer Plan have
occurred or exist, a statement signed by a senior financial officer of such
Borrower setting forth details respecting such event or condition and the
action, if any, which such Borrower or its ERISA Affiliate proposes to take with
respect thereto (and a copy of any report or notice required to be filed with or
given to PBGC by such Borrower or an ERISA Affiliate with respect to such event
or condition):
(i) any reportable event, as defined in section 4043( b)
of ERISA, with respect to a Plan, as to which PBGC has not by regulation waived
the requirement
173
of section 4043( a) of ERISA that it be notified within 30 days of the
occurrence of such event (provided that a failure to meet the minimum funding
standard of section 412 of the Code or section 302 of ERISA including, without
limitation, the failure to make on or before its due date a required installment
under section 412( m) of the Code or section 302( e) of ERISA, shall be a
reportable event regardless of the issuance of any waivers in accordance with
section 412( d) of the Code) and any request for a waiver under section 412( d)
of the Code for any Plan;
(ii) the distribution under section 4041 of ERISA of a
notice of intent to terminate any Plan or any action taken by such Borrower or
an ERISA Affiliate to terminate any Plan;
(iii) the institution by PBGC of proceedings under
section 4042 of ERISA for the termination of, or the appointment of a trustee to
administer, any Plan, or the receipt by such Borrower or any ERISA Affiliate of
a notice from a Multiemployer Plan that such action has been taken by PBGC with
respect to such Multiemployer Plan;
(iv) the complete or partial withdrawal from a
Multiemployer Plan by such Borrower or any ERISA Affiliate that results in
liability under section 4201 or 4204 of ERISA (including the obligation to
satisfy secondary liability as a result of a purchaser default) or the receipt
of such Borrower or any ERISA Affiliate of notice from a Multiemployer Plan that
it is in reorganization or insolvency pursuant to section 4241 or 4245 of ERISA
or that it intends to terminate or has terminated under section 4041A of ERISA;
(v) the institution of a proceeding by a fiduciary of
any Multiemployer Plan against such Borrower or any ERISA Affiliate to enforce
section 515 of ERISA, which proceeding is not dismissed within 30 days;
(vi) the adoption of an amendment to any Plan that
pursuant to section 401( a)( 29) of the Code or section 307 of ERISA would
result in the loss of tax-exempt status of the trust of which such Plan is a
part if such Borrower or an ERISA Affiliate fails to timely provide security to
the Plan in accordance with the provisions of said Sections;
(vii) any event or circumstance exists which may
reasonably be expected to constitute grounds for such Borrower or any ERISA
Affiliate to incur liability under Title IV of ERISA or under sections 412( c)(
11) or 412( n) of the Code with respect to any Plan; and
(viii) the Unfunded Benefit Liabilities of one or more
Plans increase after the date of this Agreement in an amount which is material
in relation to the financial condition of such Borrower and its Subsidiaries, on
a consolidated basis; provided, however, that such increase shall not be deemed
to be material so long as it does not exceed during any consecutive 2-year
period $200,000;
(m) promptly after the request of the Bank, copies of each
annual report filed pursuant to section 104 of ERISA with respect to each Plan
(including, to the extent required by section 104 of ERISA, the related
financial and actuarial statements and opinions and other supporting statements,
certifications, schedules and information referred to in section 103) and each
annual report filed with respect to each Plan under section 4065 of ERISA;
provided, however, that in the case of a Multiemployer Plan, such annual reports
shall be furnished only if they are available to such Borrower or an ERISA
Affiliate;
174
(n) promptly after the furnishing thereof, copies of any
statement or report furnished to any other party pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required to be
furnished to the Bank pursuant to any other clause of this Section 6.8;
(o) promptly after the sending or filing thereof, copies of
all proxy statements, financial statements and reports which any Borrower or any
of its Subsidiaries sends to its stockholders, and copies of all regular,
periodic and special reports, and all registration statements which any Borrower
or any of its Subsidiary files with the Securities and Exchange Commission or
any governmental authority which may be substituted therefor, or with any
national securities exchange;
(p) as soon as available, and in any event within 10 days of
the end of each fiscal month, an aging schedule with respect to Receivables of
each Borrower with names of all account debtors, and an Inventory breakdown for
each Borrower, as of the end of such calendar month and certified by the
President or Chief Financial Officer of each Borrower;
(q) a monthly Borrowing Base Certificate certified by Tridex's
President or Chief Financial Officer, within 10 days of the end of each month;
(r) promptly after the sending thereof, copies of any reports
or financial covenant compliance certificates provided to the holders of
Subordinated Debt by any of the Borrowers;
(s) notice of any proposed payment or prepayment under the
$11,000,000 Subordinated Debt, at least 5 Banking Days prior to the date of such
proposed payment;
(t) on a continuous basis, an up-to-date list of the names and
addresses of all holders of the $11,000,000 Subordinated Debt;
(u) promptly after the commencement thereof or promptly after
any Borrower knows of the commencement or threat thereof, notice of any
Forfeiture Proceeding; and
(v) such other information respecting the condition or
operations, financial or otherwise, of any Borrower or any of its Subsidiaries
as the Bank may from time to time reasonably request.
Section 6.9. Operating Accounts. Maintain, and cause each of their
respective Subsidiaries to maintain, all principal United States operating
accounts at the Bank.
Section 6.10. Hedging of Interest Rate Exposure. Within 30 days of
the Closing Date, the Borrowers shall, on terms and conditions acceptable to the
Bank, hedge not less than 50% of their floating interest rate exposure on the
Term Loan during the first two years of the Term Loan.
ARTICLE 7. NEGATIVE COVENANTS
So long as either of the Notes shall remain unpaid or the Bank shall
have either of the Commitments under this Agreement, the Borrowers shall not:
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Section 7.1. Debt. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to exist any
Debt, except:
(a) Debt of the Borrowers under this Agreement or the Notes;
(b) Debt described in Schedule 5.10, including renewals,
extensions or refinancings thereof, provided that the principal amount thereof
does not increase;
(c) Debt of the Borrowers or any of their respective
Subsidiaries secured by purchase money Liens permitted by Section 7.3;
(d) Debt represented by Capital Leases in an aggregate amount
not to exceed [$ 500,000], so long as the Bank is provided the first opportunity
to fund such Capital Lease amounts;
(e) Debt of any Borrower to any other Borrower;
(f) Debt of the Borrowers pursuant to any interest rate
protection agreements entered into pursuant to Section 6.10 hereof; and
(g) Debt of the Borrowers or and such Subsidiary, in the
maximum principal amount of $240,000, arising in connection with that certain
Assistance Agreement by and between the State of Connecticut acting by the
Department of Economic Development and Tridex Corporation pursuant to which the
State of Connecticut has agreed to make available up to $240,000, in the form of
loans or grants, for asset acquisitions (the "Assistance Agreement").
Notwithstanding the foregoing, the Borrowers will be permitted to make payments
on the $11,000,000 Subordinated Debt only if the following criteria are met:
(a) Consolidated Senior Funded Debt of the Borrowers divided
by EBITDA is less than 2.0 to 1.0 and remains below such level after such
repayment of such $11,000,000 Subordinated Debt;
(b) Consolidated Tangible Capital Base of the Borrowers is at
least $10,000,000 and remains at or above such level after the repayment of such
$11,000,000 Subordinated Debt;
(c) Consolidated Senior Liabilities divided by Tangible
Capital Base is less than 2.0 to 1.0 and remains at or below such level after
the repayment of such $11,000,000 Subordinated Debt;
(d) The payment of such $11,000,000 Subordinated Debt may not
exceed $5,000,000 annually; and
(e) The Borrowers are in compliance with all covenants and
other terms and provisions of the Facility Documents after giving effect to any
payment or prepayment of such $11,000,000 Subordinated Debt.
Section 7.2. Guaranties, Etc. Assume, guaranty, endorse or otherwise
be or become directly or contingently responsible or liable, or permit any of
their respective Subsidiaries to assume, guarantee, endorse or otherwise be or
become directly or indirectly
176
responsible or liable (including, but not limited to, an agreement to purchase
any obligation, stock, assets, goods or services or to supply or advance any
funds, assets, goods or services, or an agreement to maintain or cause such
Person to maintain a minimum working capital or net worth or otherwise to assure
the creditors of any Person against loss) for the obligations of any Person,
except guaranties by endorsement of negotiable instruments for deposit or
collection or similar transactions in the ordinary course of business.
Section 7.3. Liens. Create, incur, assume or suffer to exist, or
permit any of their respective Subsidiaries to create, incur, assume or suffer
to exist, any Lien, upon or with respect to any of its properties, now owned or
hereafter acquired, except:
(a) Liens for taxes or assessments or other government charges
or levies if not yet due and payable or if due and payable if they are being
contested in good faith by appropriate proceedings and for which appropriate
reserves are maintained;
(b) Liens imposed by law, such as mechanic's, materialmen's,
landlord's, warehousemen's and carrier's Liens, and other similar Liens,
securing obligations incurred in the ordinary course of business which are not
past due for more than 30 days, or which are being contested in good faith by
appropriate proceedings and for which appropriate reserves have been
established;
(c) Liens under workers' compensation, unemployment insurance,
social security or similar legislation (other than ERISA);
(d) Liens, deposits or pledges to secure the performance of
bids, tenders, contracts (other than contracts for the payment of money), leases
(permitted under the terms of this Agreement), public or statutory obligations,
surety, stay, appeal, indemnity, performance or other similar bonds, or other
similar obligations arising in the ordinary course of business;
(e) judgment and other similar Liens arising in connection
with court proceedings; provided that the execution or other enforcement of such
Liens is effectively stayed and the claims secured thereby are being actively
contested in good faith and by appropriate proceedings;
(f) easements, rights-of-way, restrictions and other similar
encumbrances which, in the aggregate, do not materially interfere with the
occupation, use and enjoyment by any Borrower or any such Subsidiary of the
property or assets encumbered thereby in the normal course of its business or
materially impair the value of the property subject thereto;
(g) Liens securing obligations of such a Subsidiary to a
Borrower or another such Subsidiary;
(h) Liens set forth on Schedule 7.3, provided the Debt secured
by such Liens is permitted by Section 7.1;
(i) purchase money Liens on any property hereafter acquired or
the assumption of any Lien on property existing at the time of such acquisition,
or a Lien incurred in connection with any conditional sale or other title
retention agreement or a Capital Lease; provided that:
177
(i) any property subject to any of the foregoing is
acquired by a Borrower or any such Subsidiary in the ordinary course of its
business and the Lien on any such property is created contemporaneously with
such acquisition;
(ii) the obligation secured by any Lien so created,
assumed or existing shall not exceed 80 percent of the lesser of cost or fair
market value as of the time of acquisition of the property covered thereby to a
Borrower or any such Subsidiary acquiring the same;
(iii) each such Lien shall attach only to the property
so acquired and fixed improvements thereon; and
(iv) the obligations secured by such Lien are permitted
by the provisions of Section 7.1; and
Section 7.4. Leases. Create, incur, assume or suffer to exist, or
permit their respective Subsidiaries to create, incur, assume or suffer to
exist, any obligation as lessee for the rental or hire of any real or personal
property, except: (a) leases existing on the date of this Agreement and any
extensions or renewals thereof; (b) leases (other than Capital Leases) which do
not in the aggregate require the Borrowers and their respective Subsidiaries on
a consolidated basis to make payments (including taxes, insurance, maintenance
and similar expense which any Borrower or any Subsidiary is required to pay
under the terms of any lease) in any fiscal year of the Borrowers in excess of
$250,000; (c) Capital Leases permitted by Section 7.3.
Section 7.5. Investments. Make, or permit any of their respective
Subsidiaries to make, any loan or advance to any Person or purchase or otherwise
acquire, or permit any such Subsidiary to purchase or otherwise acquire, any
capital stock, assets, obligations or other securities of, make any capital
contribution to, or otherwise invest in, or acquire any interest in, any Person,
except: (a) direct obligations of the United States of America or any agency
thereof with maturities of one year or less from the date of acquisition; (b)
commercial paper of a domestic issuer rated at least "A-1" by Standard & Poor's
Corporation or "P-1" by Xxxxx'x Investors Service, Inc.; (c) certificates of
deposit with maturities of one year or less from the date of acquisition issued
by any commercial bank operating within the United States of America having
capital and surplus in excess of $500,000,000; and (d) for stock, obligations or
securities received in settlement of debts (created in the ordinary course of
business) owing to a Borrower or any such Subsidiary.
Section 7.6. Dividends. Declare or pay any dividends, purchase,
redeem, retire or otherwise acquire for value any of its capital stock now or
hereafter outstanding, or make any distribution of assets to its stockholders as
such whether in cash, assets or in obligations of any Borrower, or allocate or
otherwise set apart any sum for the payment of any dividend or distribution on,
or for the purchase, redemption or retirement of any shares of its capital
stock, or make any other distribution by reduction of capital or otherwise in
respect of any shares of its capital stock or permit any of their respective
Subsidiaries to purchase or otherwise acquire for value any stock of any
Borrower or another such Subsidiary, except that: (a) any Borrower may declare
and deliver dividends and make distributions payable solely in common stock of
such Borrower; (b) any Borrower may purchase or otherwise acquire shares of its
capital stock by exchange for or out of the proceeds received from a
substantially concurrent issue of new shares of its capital stock; (c) payments
may be made on the $11,000,000 Subordinated Debt in accordance with Section 7.1
hereof; and (d) any Subsidiary may declare and deliver dividends and make
distributions to a Borrower which is its parent corporation.
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Section 7.7. Sale of Assets. Sell, lease, assign, transfer or
otherwise dispose of, or permit any of their respective Subsidiaries to sell,
lease, assign, transfer or otherwise dispose of, any of its now owned or
hereafter acquired assets (including, without limitation, shares of stock and
indebtedness of such Subsidiaries, receivables and leasehold interests); except:
(a) for inventory disposed of in the ordinary course of business; (b) the sale
or other disposition of assets no longer used or useful in the conduct of its
business; and (c) that any such Subsidiary may sell, lease, assign or otherwise
transfer its assets to its parent corporation.
Section 7.8. Stock of Subsidiaries, Etc. Sell or otherwise dispose
of any shares of capital stock of any of their respective Subsidiaries or permit
any such Subsidiary to issue any additional shares of its capital stock, except
directors' qualifying shares.
Section 7.9. Transactions with Affiliates. Enter into any
transaction, including, without limitation, the purchase, sale or exchange of
property or the rendering of any service, with any Affiliate or permit any of
their respective Subsidiaries to enter into any transaction, including, without
limitation, the purchase, sale or exchange of property or the rendering of any
service, with any Affiliate, except in the ordinary course of and pursuant to
the reasonable requirements of such Borrower's or such Subsidiary's business and
upon fair and reasonable terms no less favorable to such Borrower or such
Subsidiary than it would obtain in a comparable arms' length transaction with a
Person not an Affiliate, and except as set forth on Schedule 7.9.
Section 7.10. Mergers, Etc. Merge or consolidate with, or sell,
assign, lease or otherwise dispose of (whether in one transaction or in a series
of transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to, any Person, or acquire all or substantially all of the
assets or the business of any Person (or enter into any agreement to do any of
the foregoing), or permit any of their respective Subsidiaries to do so except
that any such Subsidiary may merge into or transfer assets to a Borrower, and
except for mergers pursuant to which (i) a Borrower is the surviving entity,
(ii) voting control of the surviving entity remains with the shareholders of
such Borrower immediately preceding such merger and (iii) the Borrowers are
thereafter in full compliance with all covenants herein.
Section 7.11. No Activities Leading to Forfeiture. Neither the
Borrowers nor any of their respective Subsidiaries or Affiliates shall engage in
or propose to be engaged in the conduct of any business or activity which could
result in a Forfeiture Proceeding.
ARTICLE 8. FINANCIAL COVENANTS
So long as either of the Notes shall remain unpaid or the Bank shall
have either of the Commitments under this Agreement:
Section 8.1. Minimum Tangible Capital Base. The Borrowers, on a
consolidated basis, shall maintain at all times, as measured at the end of each
fiscal quarter, commencing June 30, 1998, a Tangible Capital Base of not less
than $4,750,000, and such minimum dollar amount shall increase from year to year
by the sum of (a) 50% of the Borrowers' Net Income for each previous fiscal year
(with no reduction for losses) commencing with the annual net income determined
as of December 31, 1998 plus (b) 100% of net proceeds from the sale of stock or
asset sales after January 1, 1998, plus (c) 100% of the amount of any issuance
of additional Subordinated Debt, plus (d) 75% of the net proceeds from the Mass
Mutual Transaction.
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Section 8.2. Maximum Senior Funded Debt to EBITDA Ratio. The
Borrowers, on a consolidated basis, shall maintain at all times, as measured at
the end of each fiscal quarter, commencing June 30, 1998 for the twelve month
period then ended (a rolling twelve month calculation measured as of the end of
each successive quarter), a ratio of Senior Funded Debt to EBITDA, of not more
than 4.0 to 1.0, provided, however, that this ratio shall be reduced to not more
than 3.0 to 1.0 commencing on March 31, 1999 and shall be reduced to not more
than 2.5 to 1.0 commencing on March 31, 2000.
Section 8.3. Maximum Funded Debt to EBITDA Ratio. The Borrowers, on
a consolidated basis, shall maintain at all times, as measured at the end of
each fiscal quarter, commencing June 30, 1998 for the twelve month period then
ended (a rolling twelve month calculation measured as of the end of each
successive quarter), a ratio of Funded Debt to EBITDA, of not more than 6.25 to
1.0, provided, however, that this ratio shall be reduced to not more than 4.5 to
1.0 commencing on March 31, 1999 and shall be reduced to not more than 4.0 to
1.0 commencing on March 31, 2000.
Section 8.4. Minimum Interest Coverage Ratio. The Borrowers, on a
consolidated basis, shall maintain at all times, as measured at the end of each
fiscal quarter, commencing June 30, 1998 for the twelve month period then ended
(a rolling twelve month calculation measured as of the end of each successive
quarter), an Interest Coverage Ratio of not less than 2.0 to 1.0.
Section 8.5. Minimum Fixed Charge Coverage Ratio. The Borrowers, on
a consolidated basis, shall maintain at all times, as measured at the end of
each fiscal quarter, commencing June 30, 1998 for the twelve month period then
ended (a rolling twelve month calculation measured as of the end of each
successive quarter), a Fixed Charge Coverage Ratio of not less than 1.25 to 1.0,
provided, however, that this ratio shall be increased to not less than 1.5 to
1.0 commencing on March 31, 1999.
ARTICLE 9. EVENTS OF DEFAULT
Section 9.1. Events of Default. Any of the following events shall be
an "Event of Default":
(a) the Borrowers shall: (i) fail to pay the principal of any
Note as and when due and payable; or (ii) fail to pay interest on any Note or
any fee or other amount due hereunder as and when due and payable;
(b) any representation or warranty made or deemed made by any
Borrower in this Agreement or in any other Facility Document or which is
contained in any certificate, document, opinion, financial or other statement
furnished at any time under or in connection with any Facility Document shall
prove to have been incorrect in any material respect on or as of the date made
or deemed made;
(c) any Borrower shall: (i) fail to perform or observe any
term, covenant or agreement contained in Section 2.3 or Articles 7 or 8; or (ii)
fail to perform or observe any term, covenant or agreement on its part to be
performed or observed (other than the obligations specifically referred to
elsewhere in this Section 9.1) in any Facility Document and such failure shall
continue for 20 consecutive days after the earlier to occur of (i) such
Borrower's obtaining actual knowledge of such failure or default or (ii) such
Borrower's receipt of written notice of such default;
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(d) any Borrower, or any of its respective Subsidiaries: (i)
shall generally not, or be unable to, or shall admit in writing its inability
to, pay its debts as such debts become due; or (ii) shall make an assignment for
the benefit of creditors, petition or apply to any tribunal for the appointment
of a custodian, receiver or trustee for it or a substantial part of its assets;
or (iii) shall commence any proceeding under any bankruptcy, reorganization,
arrangement, readjustment of debt, dissolution or liquidation law or statute of
any jurisdiction, whether now or hereafter in effect; or (iv) shall have had any
such petition or application filed or any such proceeding shall have been
commenced against it, in which an adjudication or appointment is made or order
for relief is entered, or which petition, application or proceeding remains
undismissed for a period of 30 days or more; or shall be the subject of any
proceeding under which its assets may be subject to seizure, forfeiture or
divestiture (other than a proceeding in respect of a Lien permitted under
Section 7.3( b)); or (v) by any act or omission shall indicate its consent to,
approval of or acquiescence in any such petition, application or proceeding or
order for relief or the appointment of a custodian, receiver or trustee for all
or any substantial part of its property; or (vi) shall suffer any such
custodianship, receivership or trusteeship to continue undischarged for a period
of 30 days or more;
(e) one or more judgments, decrees or orders for the payment
of money in excess of $500,000 in the aggregate shall be rendered against any
Borrower, or any of its respective Subsidiaries and such judgments, decrees or
orders shall continue unsatisfied and in effect for a period of 30 consecutive
days without being vacated, discharged, satisfied or stayed or bonded pending
appeal;
(f) any event or condition shall occur or exist with respect
to any Plan or Multiemployer Plan concerning which any Borrower is under an
obligation to furnish a report to the Bank in accordance with Section 6.8( h)
hereof and as a result of such event or condition, together with all other such
events or conditions, such Borrower or any ERISA Affiliate has incurred or in
the opinion of the Bank is reasonably likely to incur a liability to a Plan, a
Multiemployer Plan, the PBGC or a section 4042 Trustee (or any combination of
the foregoing) which is material in relation to the financial position of such
Borrower and its Subsidiaries, on a consolidated basis; provided, however, that
any such amount shall not be deemed to be material so long as all such amounts
do not exceed in the aggregate during any consecutive 2-year period $500,000;
(g) the Unfunded Benefit Liabilities of one or more Plans have
increased after the date of this Agreement in an amount which is material (as
specified in Section 9.1( g) hereof);
(h) (A) any Forfeiture Proceeding shall have been commenced or
any Borrower shall have given the Bank written notice of the commencement of any
Forfeiture Proceeding as provided in Section 6.8 or (B) the Bank has a good
faith basis to believe that a Forfeiture Proceeding has been threatened or
commenced;
(i) there shall be any material adverse change in the
condition (financial or otherwise), business, management, operations, properties
or prospects of the Borrowers and their respective Subsidiaries since the
Closing Date;
(j) the Security Agreement shall at any time after its
execution and delivery and for any reason cease: (A) to create a valid and
perfected first priority security interest in and to the property purported to
be subject to such agreement; or (B) to be in full force and effect or shall be
declared null and void, or the validity or enforceability thereof shall be
con-
181
tested by the party thereto, or such party shall deny it has further liability
or obligation thereunder or such party shall fail to perform any of its
obligations thereunder;
(k) any refinancing of the Working Capital Loans with another
financial institution, either before or after the Revolving Credit Termination
Date, at a time when the Term Loan is still outstanding; or
(l) any default or event of default shall occur and be
continuing under the Sub Debt Agreements.
Section 9.2. Remedies. If any Event of Default shall occur and be
continuing, the Bank may, by notice to the Borrowers, (a) declare the
Commitments to be terminated, whereupon the same shall forthwith terminate, and
(b) declare the outstanding principal of the Notes, all interest thereon and all
other amounts payable under this Agreement and the Notes or any one of them to
be forthwith due and payable, whereupon the Notes, all such interest and all
such amounts shall become and be forthwith due and payable, without presentment,
demand, protest or further notice of any kind, all of which are hereby expressly
waived by the Borrowers; provided that, in the case of an Event of Default
referred to in Section 9.1( d) or Section 9.1( h)( A) above, the Commitments
shall be immediately terminated, and the Notes, all interest thereon and all
other amounts payable under this Agreement shall be immediately due and payable
without notice, presentment, demand, protest or other formalities of any kind,
all of which are hereby expressly waived by the Borrowers.
ARTICLE 10. MISCELLANEOUS
Section 10.1. Amendments and Waivers. Except as otherwise expressly
provided in this Agreement, any provision of this Agreement may be amended or
modified only by an instrument in writing signed by the Borrowers and the Bank,
and any provision of this Agreement may be waived by the Borrowers and the Bank.
No failure on the part of the Bank to exercise, and no delay in exercising, any
right hereunder shall operate as a waiver thereof or preclude any other or
further exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 10.2. Usury. All agreements between 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 evidenced by
the Notes or otherwise, shall the amount paid or agreed to be paid to the Bank
for the use or the forbearance of the indebtedness evidenced by the Notes exceed
the maximum permissible under applicable law. As used herein, the term
"applicable law" shall mean the law in effect as of the date hereof provided,
however that in the event there is a change in the law which results in a higher
permissible rate of interest, then the Notes shall be governed by such new law
as of its effective date. In this regard, it is expressly agreed that it is the
intent of the Borrowers and the Bank in the execution, delivery and acceptance
of the Notes to contract in strict compliance with the laws of the State of
Connecticut from time to time in effect. If, under or from any circumstances
whatsoever, fulfillment of any provision hereof or of any of the Facility
Documents at the time of performance of such provision shall be due, shall
involve transcending the limit of such validity prescribed by applicable law,
then the obligation to be fulfilled shall automatically be reduced to the limits
of such validity, and if under or from circumstances whatsoever the Bank should
ever receive as interest an amount which would exceed the highest lawful rate,
such amount which would be excessive interest shall be applied to the reduction
of the principal balance evidenced hereby and
182
not to the payment of interest. This provision shall control every other
provision of all agreements between the Borrowers and the Bank.
Section 10.3. Expenses. The Borrowers shall reimburse the Bank on
demand for all reasonable costs, expenses and charges (including, without
limitation, telephone, telex, courier expenses, printing costs, reasonable fees
and charges of external legal counsel for the Bank and reasonable costs
allocated after the Closing Date by its internal legal department) incurred by
the Bank in connection with the preparation, negotiation, execution, delivery,
filing, recording, performance, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of
this Agreement, the Notes or any Facility Document (subject to a limit of
$35,000, plus disbursements, for the fees of external counsel in preparing the
Facility Documents). The Borrowers agree to indemnify the Bank and its
directors, officers, employees and agents from, and hold each of them harmless
against, any and all losses, liabilities, claims, damages or expenses incurred
by any of them arising out of or by reason of any investigation or litigation or
other proceedings (including any threatened investigation or litigation or other
proceedings) relating to any actual or proposed use by the Borrowers or any of
their respective Subsidiaries of the proceeds of the Loans, including, without
limitation, the reasonable fees and disbursements of counsel incurred in
connection with any such investigation or litigation or other proceedings (but
excluding any such losses, liabilities, claims, damages or expenses incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified).
Section 10.4. Survival. The obligations of the Borrowers under
Section 10.3 shall survive the repayment of the Loans and the termination of the
Commitments.
Section 10.5. Assignment; Participations. This Agreement shall be
binding upon, and shall inure to the benefit of, the Borrowers, the Bank and
their respective successors and assigns, except that no Borrower may assign or
transfer its rights or obligations hereunder. The Bank may assign, or sell
participations in, all or any part of any Loan to another bank or other entity,
in minimum amounts of $1,000,000, in which event (a) in the case of an
assignment, upon notice thereof by the Bank to the Borrowers, the assignee shall
have, to the extent of such assignment (unless otherwise provided therein), the
same rights, benefits and obligations as it would have if it were the Bank
hereunder; and (b) in the case of a participation, the participant shall have no
rights under the Facility Documents. The agreement executed by the Bank in favor
of the participant shall not give the participant the right to require the Bank
to take or omit to take any action hereunder except action directly relating to
(i) the extension of a payment date with respect to any portion of the principal
of or interest on any amount outstanding hereunder allocated to such
participant, (ii) the reduction of the principal amount outstanding hereunder or
(iii) the reduction of the rate of interest payable on such amount or any amount
of fees payable hereunder to a rate or amount, as the case may be, below that
which the participant is entitled to receive under its agreement with the Bank.
The Bank may furnish any information concerning the Borrowers in the possession
of the Bank from time to time to assignees and participants (including
prospective assignees and participants); provided that the Bank shall require
any such prospective assignee or such participant (prospective or otherwise) to
agree in writing to maintain the confidentiality of such information. The Bank
shall have the right at any time to pledge all or any portion of its rights
under the Loans or this Agreement or the Notes to any of the twelve (12) Federal
Reserve Banks organized under Section 4 of the Federal Reserve Act, 12 U. S. C.
Section 341. No such pledge or enforcement thereof shall release the Bank from
its obligations under any of the Facility Documents.
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Section 10.6. Notices. Unless the party to be notified otherwise
notifies the other party in writing as provided in this Section, and except as
otherwise provided in this Agreement, notices shall be delivered in person or
sent by overnight courier, facsimile, ordinary mail, cable or telex addressed to
such party at its "Address for Notices" on the signature page of this Agreement.
Notices shall be effective: (a) on the day on which delivered to such party in
person, (b) on the first Banking Day after the day on which sent to such party
by overnight courier, (c) if given by mail, 48 hours after deposit in the mails
with first-class postage prepaid, addressed as aforesaid, and (d) if given by
facsimile, cable or telex, when the facsimile, cable or telex is transmitted to
the facsimile, cable or telex number as aforesaid; provided that notices to the
Bank shall be effective upon receipt. Copies of all notices sent to the Borrower
shall also be provided to Xxxxxxx X. Xxxxxxxx, Esq., Xxxxxxxx, Xxxxx & Xxxxxx,
0000 Xxxxx Xxxxxx, Xxxxxxxxxx, Xxxxx Xxxxxx 00000.
Section 10.7. Setoff. The Borrowers hereby grant to the Bank, a
lien, security interest and right of setoff as security for all liabilities and
obligations to the Bank, whether now existing or hereafter in the possession,
custody, safekeeping or control of the Bank or any entity under the control of
Fleet Financial Group, Inc., or in transit to any of them. At any time, without
demand or notice, the Bank may set off the same or any part thereof and apply
the same to any liability or obligation of the Borrowers even though unmatured
and regardless of the adequacy of any other collateral securing the Loans. ANY
AND ALL RIGHTS TO REQUIRE BANK TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT
TO ANY OTHER COLLATERAL WHICH SECURES THE LOANS, PRIOR TO EXERCISING ITS RIGHT
OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE
BORROWERS OR ANY GUARANTOR, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY
WAIVED.
SECTION 10.8. JURISDICTION; IMMUNITIES. EACH BORROWER HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY CONNECTICUT STATE OR UNITED
STATES FEDERAL COURT SITTING IN CONNECTICUT OVER ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE NOTES, AND EACH BORROWER
HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH CONNECTICUT STATE OR FEDERAL
COURT. EACH BORROWER IRREVOCABLY CONSENT TO THE SERVICE OF ANY AND ALL PROCESS
IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES OF SUCH PROCESS TO
EACH BORROWER AT ITS ADDRESS SPECIFIED IN SECTION 10.6. EACH BORROWER AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND
MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW. EACH BORROWER FURTHER WAIVES ANY OBJECTION TO VENUE IN
SUCH STATE AND ANY OBJECTION TO AN ACTION OR PROCEEDING IN SUCH STATE ON THE
BASIS OF FORUM NON CONVENIENS. EACH BORROWER FURTHER AGREES THAT ANY ACTION OR
PROCEEDING BROUGHT AGAINST THE BANK SHALL BE BROUGHT ONLY IN CONNECTICUT STATE
OR UNITED STATES FEDERAL COURT SITTING IN CONNECTICUT. EACH BORROWER WAIVES ANY
RIGHT IT MAY HAVE TO JURY TRIAL.
(a) Nothing in this Section 10.8 shall affect the right of the
Bank to serve legal process in any other manner permitted by law or affect the
right of the Bank to bring
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any action or proceeding against any Borrower or its property in the courts of
any other jurisdictions.
(b) To the extent that any Borrower has or hereafter may
acquire any immunity from jurisdiction of any court or from any legal process
(whether from service or notice, attachment prior to judgment, attachment in aid
of execution, execution or otherwise) with respect to itself or its property,
such Borrower hereby irrevocably waives such immunity in respect of its
obligations under this Agreement and the Note.
Section 10.9. Table of Contents; Headings. Any table of contents and
the headings and captions hereunder are for convenience only and shall not
affect the interpretation or construction of this Agreement.
Section 10.10. Severability. The provisions of this Agreement are
intended to be severable. If for any reason any provision of this Agreement
shall be held invalid or unenforceable in whole or in part in any jurisdiction,
such provision shall, as to such jurisdiction, be ineffective to the extent of
such invalidity or unenforceability without in any manner affecting the validity
or enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
Section 10.11. Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any party hereto may execute this Agreement by signing any
such counterpart.
Section 10.12. Integration. The Facility Documents set forth the
entire agreement between the parties hereto relating to the transactions
contemplated thereby and supersede any prior oral or written statements or
agreements with respect to such transactions.
SECTION 10.13. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
AND INTERPRETED AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
CONNECTICUT.
Section 10.14. Confidentiality. The Bank agrees (on behalf of itself
and each of its affiliates, directors, officers, employees and representatives)
to use reasonable precautions to keep confidential, in accordance with safe and
sound banking practices, any nonpublic information supplied to it by the
Borrowers pursuant to this Agreement which is identified by the Borrowers as
being confidential at the time the same is delivered to the Bank, provided that
nothing herein shall limit the disclosure of any such information (i) to the
extent required by statute, rule, regulation or judicial process, (ii) to
counsel for the Bank, (iii) to bank examiners, auditors or accountants, (iv) in
connection with any litigation to which the Bank is a party or (v) to any
assignee or participant (or prospective assignee or participant) so long as such
assignee or participant (or prospective assignee or participant) agrees to
maintain the confidentiality of such information; and provided finally that in
no event shall the Bank be obligated or required to return any materials
furnished by the Borrowers.
Section 10.15. Treatment of Certain Information. Each Borrower (a)
acknowledges that services may be offered or provided to it (in connection with
this Agreement or otherwise) by the Bank or by one or more of its subsidiaries
or affiliates and (b) acknowledges that information delivered to the Bank by any
Borrower may be provided to each such subsidiary and affiliate.
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SECTION 10.16. COMMERCIAL WAIVER. EACH BORROWER ACKNOWLEDGES THAT
THE LOANS EVIDENCED BY THE NOTES ARE FOR COMMERCIAL PURPOSES AND WAIVES ANY
RIGHT TO NOTICE AND HEARING UNDER SECTIONS 52-278a THROUGH 52-278n OF THE
CONNECTICUT GENERAL STATUTES AS NOW OR HEREAFTER AMENDED AND AUTHORIZES THE
ATTORNEY OF THE BANK, OR ANY SUCCESSOR THERETO, TO ISSUE A WRIT OF PREJUDGMENT
REMEDY WITHOUT COURT ORDER. FURTHER, EACH BORROWER HEREBY WAIVES, TO THE EXTENT
PERMITTED BY LAW, THE BENEFITS OF ALL VALUATION, APPRAISEMENTS, HOMESTEAD,
EXEMPTION, STAY, REDEMPTION AND MORATORIUM LAWS NOW IN FORCE OR WHICH MAY
HEREAFTER BECOME LAWS. EACH BORROWER ACKNOWLEDGES THAT IT MAKES THESE WAIVERS
AND THE WAIVERS CONTAINED IN SECTION 10.8 KNOWINGLY, VOLUNTARILY AND ONLY AFTER
EXTENSIVE CONSIDERATION OF THE RAMIFICATIONS OF THESE WAIVERS WITH ITS
ATTORNEYS.
SECTION 10.17. WAIVER OF JURY TRIAL BECAUSE DISPUTES ARISING IN
CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY
RESOLVED BY AN EXPERIENCED AND EXPERT PERSON AND THE BORROWERS AND THE BANK WISH
APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE
BORROWERS AND THE BANK DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE
APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE
BENEFITS OF THE JUDICIAL SYSTEM AND OF ARBITRATION, THE BORROWERS AND THE BANK
HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE, WHETHER IN CONTRACT, TORT, OR OTHERWISE ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO, THIS AGREEMENT OR ANY OF
THE OTHER FACILITY DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
Section 10.18. Multiple Borrowers.
(a) It is understood and agreed by each Borrower that the
handling of this credit facility on a joint borrowing basis as set forth in this
Agreement is solely as an accommodation to the Borrowers and at their request,
and that the Bank shall not incur liability to the Borrowers as a result
thereof. To induce the Bank to do so and in consideration thereof, each Borrower
hereby agrees to indemnify the Bank and to hold the Bank harmless from and
against any and all liabilities, expenses, losses, damages and claims of damage
or injury asserted against the Bank by any Borrower or by any other Person
arising from or incurred by reason of the Bank's handling of the financing
arrangements of the Borrowers as provided herein, reliance by the Bank on any
request or instruction from any other Borrower or any other action taken by the
Bank with respect to this Section 10.18.
(b) Each Borrower represents and warrants to the Bank that the
request for joint handling of the Loans to be made by the Bank hereunder was
made because the Borrowers are engaged in an integrated operation which required
financing on a basis permitting the availability of credit from time to time to
each Borrower as required for the continued successful operation of each
Borrower of the integrated operation of the Borrowers. Each Borrower expects to
derive benefit, directly or indirectly, from such availability because the
186
successful operation of the Borrowers is dependent on the continued successful
performance of the functions of the integrated group.
(c) Each Borrower hereby irrevocably designates Tridex as its
attorney to borrow, sign and endorse notes, and execute and deliver all
instruments, documents, writings and further assurances now or hereafter
required hereunder, on behalf of each Borrower, and does hereby authorize the
Bank to pay over or credit all Loan proceeds hereunder to Tridex as the
Borrowers' attorney in fact, recognizing, however, that the Bank is not bound by
such authorization and may elect either to disburse loan proceeds to each
Borrower directly for its use, to Tridex as attorney for any Borrower or to
Tridex for its own account, in which case Tridex may advance or lend such
proceeds to the other Borrowers. Notwithstanding the foregoing, the Bank agrees
to advance (i) the proceeds of the Term Loan and (ii) an initial advance of
$3,500,000 (subject to reduction pursuant to Section 2.3 in the event of the
Mass Mutual Transaction) under the Working Capital Loans directly to Tridex NC
to be utilized to pay a portion of the acquisition price of PSI's stock. In
addition, and notwithstanding any other provision to the contrary in this
Agreement, the Term Loan and that portion of the Working Capital Loans so
advanced to Tridex NC to pay a portion of the purchase price of PSI is stock
shall be repaid to the Bank in accordance with this Agreement first from Tridex
NC and the liability of the other three Borrowers in respect of such Loans shall
be asserted by the Bank only at such time as a demand for payment for such Loans
has first been made by the Bank to Tridex NC. Subject to the foregoing, the
Borrowers shall remain jointly and severally liable on all of the Loans, and
each of Tridex, UTI and PSI hereby jointly and severally and unconditionally
guaranty the prompt payment and performance of all obligations of Tridex NC in
respect of the Loans. Each Borrower further agrees that all obligations
hereunder or referred to herein or under any other Facility Document shall be
joint and several, and that each Borrower shall make payment upon any notes
issued pursuant hereto and any and all other obligations hereunder or referred
to herein or under any other Facility Document upon their maturity by
acceleration or otherwise, and that such obligation and liability on the part of
each Borrower shall in no way be affected by any extensions, renewals and
forbearances granted by the Bank to any Borrower, failure of the Bank to give
any Borrower notice of borrowing or any other notice, any failure of the Bank to
pursue or preserve its rights against any other Borrower, the release by the
Bank of any collateral now or hereafter acquired from any Borrower, failure of
the Bank to realize upon such collateral in a commercially reasonable manner,
and that such agreement by each Borrower to pay upon any notice issued pursuant
hereto is unconditional and unaffected by prior recourse by the Bank to the
other Borrowers or any collateral for such Borrowers' obligations or the lack
thereof.
(d) Each Borrower hereby grants a right of contribution to
each other Borrower for any amount paid by such other Borrower in satisfaction
of any obligations under this Agreement, the Notes or any other Facility
Document; provided, however, that the aggregate of the rights of contribution
against any Borrower hereunder shall not exceed such Borrower's net worth. In
calculating the net worth of any Borrower for purposes of this paragraph, such
Borrower's obligations under the Facility Documents will not be included in its
liabilities and such Borrower's rights of contribution against other Borrowers
for amounts paid under the Facility Documents will not be included in its
assets.
(e) All notices to, or other communications with, the
Borrowers or any one of them shall be sufficient if given to any of the
Borrowers. Although the Bank may require that all of the Borrowers or a
particular Borrower execute any document (including any Notice of Borrowing) in
any matter pertaining to this Agreement or any of the other Facility Documents,
187
any one of the Borrowers may bind all of the Borrowers and any document
(including any Notice of Borrowing) signed by any Borrower, and any and all
action taken by any Borrower, is sufficient to represent all of the Borrowers.
Without limiting the foregoing, any single Borrower may make representations and
warranties on behalf of all the Borrowers or any other Borrower, and such
representations and warranties shall be of the same force and effect as if made
directly by such other Borrowers.
Section 10.19. Independence of Covenants. All covenants hereunder
shall be given independent effect so that if a particular action or condition is
not permitted by any of such covenants, the fact that it would be permitted by
an exception to, or be otherwise within the limitations of, another covenant
shall not avoid the occurrence of a Default or Event of Default if such action
is taken or condition exists.
Section 10.20. Time of the Essence. Time and punctuality shall be of
the essence with respect to this instrument, but no delay or failure of the Bank
to enforce any of the provisions herein contained and no conduct or statement of
the Bank shall waive or affect any of the Bank's rights hereunder.
Section 10.21. Reference to and Effect on the Facility Documents.
(a) Upon the effectiveness of this Agreement, on and after the
date hereof each reference in the Facility Documents to the Credit Agreement or
the Note, shall mean and be a reference to this Credit Agreement as amended and
restated hereby or the Note as amended and restated in connection with the
execution and delivery of this Agreement.
(b) The execution, delivery and effectiveness of this
Agreement shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of the Bank under any of the Facility Documents, nor
constitute a waiver of any provision of any of the Facility Documents.
Section 10.22. Replacement Promissory Note. Upon receipt of an
affidavit of an officer of the Bank as to the loss, theft, destruction or
mutilation of any Note or any other security document which is not of public
record, and, in the case of any such loss, theft, destruction or mutilation,
upon surrender and cancellation of such Note or other security document,
Borrower will issue, in lieu thereof, a replacement Note or other security
document in the same principal amount thereof and otherwise of like tenor.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
TRIDEX CORPORATION
By
------------------------------------
Xxxxxx X. Xxxxxxxx
Treasurer
Address for Notices to Borrower:
00 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
ULTIMATE TECHNOLOGY CORPORATION
By
------------------------------------
Xxxxxx X. Xxxxxxxx
Treasurer
Address for Notices to Borrower:
000 Xxxxxx Xxxx
Xxxxxx, Xxx Xxxx 00000
PROGRESSIVE SOFTWARE, INC.
By
------------------------------------
Xxxxxx Xxxxxxxx
Treasurer
Address for Notices to Borrower:
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
TRIDEX NC, INC.
By
------------------------------------
Xxxxxx Xxxxxxxx
Treasurer
189
Address for Notices to Borrower:
00 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
FLEET NATIONAL BANK
By
------------------------------------
Xxxxxxxxx X. Xxxxxxx
Vice President
Address for Notices and Lending Office:
Xxx Xxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xxxxxxxxx X. Xxxxxxx
Vice President
Facsimile No.: (000) 000-0000
190
EXHIBITS
Exhibit A-1 - Term Note
Exhibit A-2 - Working Capital Note
Exhibit B - Borrowing Base Certificate
Exhibit C - Security Agreement
Exhibit D - Pledge Agreement
Exhibit E - Notice of Borrowing
SCHEDULES
Schedule 5.4 - Litigation
Schedule 5.7 - Taxes
Schedule 5.9 - Subsidiaries of Borrowers
Schedule 5.10 - Credit Arrangements
Schedule 5.12 - Hazardous Materials
Schedule 7.3 - Liens
Schedule 7.9 - Transactions with Affiliates Outside the Ordinary Course of
Business
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