LOAN AGREEMENT
THIS LOAN AGREEMENT (the Agreement) is made and dated this 25th day of
March, 1998, by and between Transaction Systems Architects, Inc. ("TSA") or (the
"Lender"), a Delaware corporation, and Xxxxxx, Inc. ("Xxxxxx") or (the
"Borrower"), a Delaware corporation.
RECITALS
X. Xxxxxx has requested the Lender to extend credit to Xxxxxx and the
Lender has agreed to do so.
X. Xxxxxx and the Lender desire to set forth herein the mutually agreed
upon terms and conditions of such credit extension.
NOW, THEREFORE, in consideration of the above Recitals and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1. Term Loan
A. Term Loan. On the terms and subject to the conditions set forth herein,
the Lender agrees that it shall, on and after March 25, 1998, make a loan (the
"Term Loan") to Xxxxxx in the amount up to One Million Five Hundred Thousand and
00/100 Dollars ($1,500,000) (the "Term Loan").
B. Advances. Advances in integrals of $100,000.00 will be made upon written
request of Xxxxxx. Such advances will be made one (1) Business Day following the
date the request is received and shall be made by wire transfer .
C. Calculation of Interest. Xxxxxx shall pay interest on the outstanding
principal balance of the Term Loan from the date disbursed to but not including
the date of payment at a rate per annum equal to the prime rate as published
from time-to-time in the Wall Street Journal (the "Applicable Prime Rate").
D. Payment of Interest. Interest accruing on the Term Loan shall be payable
quarterly, in arrears for each quarter on or before the tenth (10th) Business
Day of the next succeeding calendar quarter in the amount set forth in an
interest billing delivered by the Lender to Xxxxxx on or before the fifth (5th)
Business Day of such quarter.
E. Repayment of Principal. The Term Loan may be repaid, in the discretion
of Xxxxxx, from time to time, but in any event shall be repaid in full on March
31, 1999.
F. Collateralization. The Term Loan shall be collateralized by current and
future royalties due Xxxxxx from Lender or its subsidiaries under distributer
agreement(s). The amount of royalties used to collateralize the Term Loan shall
be equal to the total amount of the outstanding principal and interest.
2. Additional Provisions
A. Use of Proceeds. The proceeds of the Term Loan shall be utilized by
Xxxxxx for purchase of capital assets and to meet working capital requirements
in the ordinary course of Nestor's business.
B. Note. The obligation of the Borrower to repay the Term Loan shall be
evidenced by a Note payable to the order of the Lender in the form of that
attached hereto as Exhibit 2B (the Note).
C. Nature and Place of Payments. All payments made on account shall be made
by Xxxxxx, without setoff or counterclaim, in lawful money of the United States
in immediately available funds, free and clear of and without deduction for any
taxes, fees, or other charges of any nature whatsoever imposed by any taxing
authority and must be received by the Lender by 10:00 a.m. central time on the
day of payment, it being expressly agreed and understood that if a payment is
received after 10:00 a.m. central time by the Lender, such payment will be
considered to have been made by Xxxxxx on the next succeeding Business Day and
interest thereon shall be payable by Xxxxxx at the Applicable Prime Rate during
such extension. All payments on account of the Obligations shall be made to the
Lender through its office located at Transaction Systems Architects, Inc., 000
Xxxxx 000xx Xxxxxx, Xxxxx, Xxxxxxxx 00000. If any payment required to be made by
Xxxxxx hereunder becomes due and payable on a day other than a Business Day ,
then interest thereon shall be payable at the then applicable rate during such
extension.
D. Postmaturity Interest. Any Obligations not paid when due (whether at
stated maturity, upon acceleration or otherwise) shall bear interest from the
date due until paid in full at a per annum rate equal to two percent (2%) above
the Applicable Prime Rate.
E. Computations. All computations of interest and fees payable hereunder
shall be based upon a year deemed to consist of 360 days for the actual number
of days elapsed.
F. Prepayments.
x. Xxxxxx may prepay the Term Loan, in whole at any time or in part
from time to time, upon not less than one Business Day's prior written
notice to the Lender. Principal amounts prepaid shall be applied to
installments on the Term Loan in the order of their maturity.
ii. Xxxxxx shall pay in connection with any prepayment hereunder all
interest accrued but unpaid on the Term Loan concurrently with payment to
the Lender of any principal amounts.
3. Conditions to Making Term Loan
As conditions precedent to the obligation of the Lender to make the Term Loan,
including each Advance:
A. Delivery of Documents. Xxxxxx shall have delivered or shall have had
delivered to the Lender, in form and substance satisfactory to the Lender and
its counsel, each of the following:
i. A duly executed copy of this Agreement;
ii. A duly executed copy of the other Loan Documents;
iii. Such credit applications, financial statements, authorizations,
and such information concerning Xxxxxx and its business, operations and
condition (financial and otherwise) as the Lender may reasonably request;
iv. Copies of resolutions of the Board of Directors of Xxxxxx
approving the execution and delivery of the Loan Documents certified by the
Secretary of Xxxxxx as of the date of this Agreement;
v. A certificate of the Secretary of Xxxxxx certifying the names and
true signatures of the officers of Xxxxxx authorized to sign the Loan
Documents;
vi. A copy of the Certificate of Incorporation of Xxxxxx, certified by
the Secretary of State of Delaware as of a recent date;
vii. A copy of each of the Certificate of Incorporation and Bylaws of
Xxxxxx, certified by the Secretary or an Assistant Secretary of Xxxxxx as
of the date of this Agreement as being accurate and complete;
viii. A certificate of good standing of Xxxxxx from the Secretary of
State of Delaware as of a recent date;
ix. Certificates of authority and good standing of Xxxxxx for each
state in which Xxxxxx is qualified to do business; and
x. A certificate of the president and chief financial officer or
treasurer of Xxxxxx certifying that the Representations and Warranties of
Xxxxxx set forth in Section 7 are true and accurate in all material
respects as of the date of this Agreement.
Provided, however, that any document not delivered at or before the
initial Advance after execution of this Agreement with the consent of
Lender shall be provided within thirty (30) days.
B. Approvals. All acts and conditions (including, without limitation, the
obtaining of any necessary regulatory approvals and the making of any required
filings, recordings, or registrations) required to be done and performed and to
have happened precedent to the execution, delivery and performance of the Loan
Documents and to constitute the same legal, valid, and binding obligations,
enforceable in accordance with their respective terms, shall have been done and
performed and shall have happened in due and strict compliance with all
applicable laws.
C. Documentation Acceptable. All documentation, including, without
limitation, documentation for corporate and legal proceedings in connection with
the transactions contemplated by the Loan Documents shall be satisfactory in
form and substance to the Lender.
D. Representations and Warranties. The representations and warranties of
Xxxxxx contained in the Loan Documents shall be accurate and complete in all
respects as if made on and as of each funding date for the Term Loan.
E. Existence of Defaults. There shall not have occurred an Event of Default
or Potential Default that is continuing unwaived.
4. Representations and Warranties of Xxxxxx
As an inducement to the Lender to enter into this Agreement and to make
Loans as provided herein, Xxxxxx represents and warrants to the Lender that:
A. No Change. There has been no material adverse change in the business,
operations, assets, or financial or other condition of Xxxxxx taken as a whole
since the financial statements furnished to Lender by Xxxxxx covering the period
ended December 31, 1997, and, except as set forth in Exhibit 4A (Material Lease
Schedule) Xxxxxx has not entered into, incurred, or assumed any long-term debt,
mortgages, material leases or oral or written commitments, nor commenced any
significant project, nor made any purchase or acquisition of any significant
property.
B. Corporate Existence; Compliance with Law. Xxxxxx (i) is duly organized,
validly existing, and in good standing as a corporation under the laws of the
State of Delaware and is qualified to do business in each jurisdiction where its
ownership of property or conduct of business requires such qualification and
where failure to qualify would have a material adverse effect on Xxxxxx or its
property and/or business or on the ability of Xxxxxx to pay or perform the
Obligations; (ii) has the corporate power and authority and the legal right to
own and operate its property and to conduct business in the manner in which it
does and proposed so to do; and (iii) is in compliance with all Requirements of
Law.
C. Corporate Power; Authorization; Enforceable Obligations. Xxxxxx has the
corporate power and authority and the legal right to execute, deliver, and
perform the Loan Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of the
Loan Documents. The Loan Documents have been duly executed and delivered on
behalf of Xxxxxx and constitute legal, valid. and binding obligations of Xxxxxx
enforceable against Xxxxxx in accordance with their respective terms, subject to
the effect of applicable bankruptcy and other similar laws affecting the rights
of creditors generally and the effect of equitable principles whether applied in
an action at law or a suit in equity.
D. No Legal Bar. The execution, delivery and performance of the Loan
Documents, the borrowing hereunder and the use of the proceeds thereof, will not
violate any Requirement of Law or any Contractual Obligation of Xxxxxx or create
or result in the creation of any Lien on any assets of Xxxxxx, except as
pursuant to the Security Agreement.
E. No Material Litigation. Except as disclosed on Exhibit 4E hereto, no
litigation, investigation, or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of Xxxxxx, threatened by
or against Xxxxxx or against any of Nestor's properties or revenues which is
likely to be adversely determined and which, if adversely determined, is likely
to have a material adverse effect on the business, operations, property, or
financial or other condition of Xxxxxx.
F. Taxes. Xxxxxx has filed or caused to be filed all tax returns that are
required to be filed and has paid all taxes shown to be due and payable on said
returns or on any assessments made against it or any of its property other than
taxes that are being contested in good faith by appropriate proceedings and as
to which Xxxxxx has established adequate reserves in conformity with GAAP.
G. Investment Borrower Act. Xxxxxx is not an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Borrower Act of 1940, as amended.
H. Federal Reserve Board Regulations. Xxxxxx is not engaged or will not
engage, principally or as one of its important activities, in the business of
extending credit for the purpose of "purchasing" or "carrying" any "margin
stock" within the respective meanings of such terms under Regulation U. No part
of the proceeds of any Loan issued hereunder will be used for "purchasing" or
"carrying" "margin stock" as so defined or for any purpose that violates, or
that would be inconsistent with, the provisions of the Regulations of the Board
of Governors of the Federal Reserve System.
I. ERISA. (i) No Prohibited Transactions, Accumulated Funding Deficiencies,
withdrawals from Multiemployer Plans, or Reportable Events have occurred with
respect to any Plans or Multiemployer Plans that, in the aggregate, could
subject Xxxxxx to any tax, penalty, or other liability where such tax, penalty,
or liability is not covered in full, for the benefit of Xxxxxx, by insurance;
(ii) no notice of intent to terminate a Plan has been filed, nor has any Plan
been terminated under Section 4041 of ERISA, nor has the PBGC instituted
proceedings to terminate, or appoint a trustee to administer a Plan, and no
event has occurred or condition exists that might constitute grounds under
Section 4042 of ERISA for the termination of or the appointment of a trustee to
administer any Plan; (iii) the present value of all benefit liabilities (as
defined in Section 4001(a)(16) of ERISA) under all Plans (based on the actuarial
assumptions used to fund the Plans) does not exceed the assets of the Plans; and
(iv) the execution, delivery, and performance by Xxxxxx of this Agreement and
the Loans hereunder and the use of the proceeds thereof will not involve any
Prohibited Transactions.
J. Assets. Xxxxxx has good and marketable title to all property and assets,
except property and assets sold or otherwise disposed of in the ordinary course
of business subsequent to the respective dates thereof. Except as set forth in
Exhibit 4J (Lien Schedule) Xxxxxx has no outstanding Liens on any of its
properties or assets nor are there any security agreements to which Xxxxxx is a
party, or title retention agreements, whether in the form of leases or
otherwise, of any personal property except as permitted under Paragraph 6(A)
below.
K. Securities Acts. Xxxxxx has not issued any unregistered securities in
violation of the registration requirements of Section 5 of the Securities Act of
1933, as amended, or any other law, and is not violating any rule, regulation or
requirement under the Securities Act of 1933, as amended, or the Securities and
Exchange Act of 1934, as amended. Xxxxxx is not required to qualify an indenture
under the Trust Indenture Act of 1939, as amended, in connection with its
execution and delivery of the Note.
L. Consents, etc. No consent, approval, authorization of, or registration,
declaration or filing with any governmental authority is required on the part of
Xxxxxx in connection with the execution and delivery of the Loan Documents or
the performance of or compliance with the terms, provisions, and conditions
hereof or thereof.
5. Affirmative Covenants
Xxxxxx hereby covenants and agrees with the Lender that, as long as any
Obligations remain unpaid, Xxxxxx shall:
A. Financial Statements. Furnish or cause to be furnished to the Lender:
i. Within ninety (90) days after the last day of the fiscal year of
Xxxxxx ending on December 31, 1998 and each fiscal year thereafter,
consolidated and consolidating statements of income and statements of
changes in financial position for such year and balance sheets as of the
end of such )tar presented fairly in accordance with GAAP and, if requested
by Lender, accompanied by an unqualified report of a firm of independent
certified public accountants acceptable to the Lender and including
therewith a copy of the management letter from such certified public
accountants, except that a qualification as to the ability of Xxxxxx to
remain a going concern may be made;
ii. Within forty-five (45) days after the last day of each fiscal
quarter, statements of income and changes in financial position for such
fiscal quarter and balance sheets as of the end of such fiscal quarter of
Xxxxxx, accompanied in each case by a certificate of the chief financial
officer of Xxxxxx stating that such financial statements are presented
fairly in accordance with GAAP.
B. Certificates; Reports; Other Information. Furnish or cause to be
furnished to the Lender
i. Promptly after sending, filing, or publishing the same, copies of
all proxy statements, financial statements, and reports that Xxxxxx sends
to its public stockholders, if any, and copies of all regular and periodic
reports and all registration statements that Xxxxxx files with the
Securities and Exchange Commission and copies of all press releases issued
by Xxxxxx;
ii. Within thirty (30) days after the end of each of Nestor's fiscal
years, a copy of Nestor's business plan with financial projections for
operations for the next fiscal year, such projections to be in form and
detail satisfactory to the Lender;
iii. Not later than forty-five (45) days after the end of each
quarter, a certificate of the chief financial officer or treasurer of
Xxxxxx stating he has no knowledge that an Event of Default or Potential
Default has occurred and is continuing or, if an Event of Default or
Potential Default has occurred and is continuing, a statement as to the
nature thereof and the action that Xxxxxx proposes to take with respect
thereto.
C. Payment of Indebtedness. Pay, discharge, or otherwise satisfy at or
before maturity or before it becomes delinquent, defaulted, or accelerated, as
the case may be, all its Indebtedness (including taxes), except Indebtedness
being contested in good faith and for which provision is made to the
satisfaction of the Lender for the payment thereof in the event Xxxxxx is found
to be obligated to pay such Indebtedness and which Indebtedness is thereupon
promptly paid by Xxxxxx.
D. Maintenance of Existence and Properties; Compliance. Maintain its
corporate existence and maintain all rights, privileges, licenses, approvals,
franchises, properties, and assets necessary or desirable in the normal conduct
of its business, and comply with all Requirements of Law.
E. Inspection of Property; Books and Records; Discussions. Keep proper
books of record and account in which full, true, and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities, and permit
representatives of the Lender (at no cost or expense to Xxxxxx unless there
shall have occurred and be continuing an Event of Default) to visit and inspect
any of its properties and examine and , make abstracts from and copies of any of
its books and records at any reasonable time and as often as may reasonably be
desired by the Lender, and to discuss the business, operations, properties, and
financial and other conditions of Xxxxxx with officers and employees of Xxxxxx,
and with their independent certified public accountants.
F. Notices. Promptly give written notice to the Lender of.
i. The occurrence of any Potential Default or Event of Default;
ii. Any litigation or proceeding affecting Xxxxxx that could have a
material adverse effect on the business, operations, property, or financial
or other condition of Xxxxxx; and
iii. A material adverse change in the business, operations, property,
or financial or other condition of Xxxxxx.
G. Expenses. Pay all reasonable out-of-pocket expenses (including fees and
disbursements of counsel) of the Lender incident to the enforcement of payment
of the Obligations, whether by judicial proceedings or otherwise, and before as
well as after judgment including, without limitation, in connection with
bankruptcy, insolvency, liquidation, reorganization, moratorium, or other
similar proceedings involving Xxxxxx or a "workout" of the Obligations.
H. Loan Documents. Comply with and observe all terms and conditions of the
Loan Documents.
I. Insurance. Obtain and maintain insurance with responsible companies in
such amounts and against such risks as are usually carried by corporations
engaged in similar businesses similarly situated, and furnish the Lender on
request full information as to all such insurance.
J. ERISA. Furnish to the Lender:
i. Promptly and in any event within 10 days after Xxxxxx knows or has
reason to know of the occurrence of a Reportable Event with respect to a
Plan with regard to which notice must be provided to the PBGC, a copy of
such materials required to be filed with the PBGC with respect to such
Reportable Event and in each such case a statement of the chief financial
officer of Xxxxxx setting forth details as to such Reportable Event and the
action that Xxxxxx proposes to take with respect thereto;
ii. Promptly and in any event within 10 days after Xxxxxx knows or has
reason to know of any condition existing with respect to a Plan that
presents a material risk of termination of the Plan, imposition of an
excise tax, requirement to provide security to the Plan or incurrence of
other liability by Xxxxxx or any ERISA Affiliate, a statement of the chief
financial officer of Xxxxxx describing such condition;
iii. At least ten (10) days prior to the filing by any plan
administrator of a Plan of a notice of intent to terminate such Plan, a
copy of such notice;
iv. Promptly and in no event more than ten (10) days after the filing
thereof with the Secretary of the Treasury, a copy of any application by
Xxxxxx or an ERISA Affiliate for a waiver of the minimum funding standard
under Section 412 of the Code;
v. Promptly and in no event more than ten (10) days after the filing
thereof with the Internal Revenue Service, copies of each annual report
that is filed on Form 5500, together with certified financial statements
for the Plan (if any) as of the end of such year and actuarial statements
on Schedule B to such Form 5500;
vi. Promptly and in any event with ten (10) days after it knows or has
reason to know of any event or condition that might constitute grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Plan, a statement of the chief financial officer
of Xxxxxx describing such event or condition;
vii. Promptly and in no event more than ten (10) days after receipt
thereof by Xxxxxx or any ERISA Affiliate, a copy of each notice received by
Xxxxxx or an ERISA Affiliate concerning the imposition of any withdrawal
liability under Section 4202 of ERISA; and
viii. Promptly after receipt thereof a copy of any notice Xxxxxx or
any ERISA Affiliate may receive from the PBGC or the Internal Revenue
Service with respect to any Plan or Multiemployer Plan; provided, however,
that this subparagraph (viii) shall not apply to notices of general
application promulgated by the PBGC or the Internal Revenue Service.
6. Negative Covenants
Xxxxxx hereby agrees that, as long as any Obligations remain unpaid, Xxxxxx
shall not, without the written consent of Lender, directly or indirectly:
A. Liens. Create, incur, assume or suffer to exist, any Lien upon any
of its property and assets except:
i. Liens or charges for current taxes, assessments, or other
governmental charges that are not delinquent or that remain payable
without penalty, or the validity of which are contested in good faith
by appropriate proceedings upon stay of execution of the enforcement
thereof, provided Xxxxxx shall have set aside on its books and shall
maintain adequate reserves for the payment of same in conformity with
GAAP;
ii. Liens, deposits, or pledges made to secure statutory
obligations, surety, or appeal bonds, or bonds for the release of
attachments or for stay of execution, or to secure the performance of
bids, tenders, contracts (other than for the payment of borrowed
money), leases, or for purposes of like general nature in the ordinary
course of Nestor's business;
iii. Purchase money security interests for property hereafter
acquired, conditional sale agreements, or other title retention
agreements, with respect to property hereafter acquired; provided,
however, that no such security interest or agreement shall extend to
any property other than the property acquired; and
iv. Liens securing Permitted Secured Debt as listed on Exhibit
6A(iv) (Permitted Liens).
B. Indebtedness. Create, incur, assume, or suffer to exist, or
otherwise become or be liable, or cause any Subsidiary to create, incur,
assume, or suffer to exist, or otherwise become or be liable, in respect of
any indebtedness except:
i. The Obligations.
ii. Trade debt incurred in the ordinary course of business and
outstanding less than thirty (30) days after the same has become due
and payable or which is being contested in good faith, provided
provision is made to the satisfaction of the Lender for the eventual
payment thereof in the event it is found that such contested trade
debt is payable by Xxxxxx.
iii. Indebtedness secured by Liens permitted under previous
paragraph 6(A) except that Xxxxxx shall not draw additional advances
under or from the Revolving Line of Credit with Citizens Bank dated
January 5, 1997 as amended by the Loan Modification Agreement dated
March 16, 1998 (the "Citizens LOC") or other cause or permit the
principal balance due Citizens Bank pursuant to the Citizens LOC
(excluding accruing interest charges) exceed $250,000; and
iv. Permitted Secured Debt which shall consist of Indebtedness
secured by assets being acquired and/or capital lease obligations
either of which shall be listed on Exhibit 6A(iv) or expressly
approved in advance in writing by Lender.
v. Indebtedness on terms and conditions expressly approved in
advance in writing by Lender.
C. Consolidation and Merger. Liquidate or dissolve or enter into any
consolidation, merger, partnership, joint venture, syndicate, or other
combination.
D. Acquisitions. Purchase or acquire or incur liability for the
purchase or acquisition of any or all of the assets or business of any
person, firm, or corporation, other than in the normal course of business
as presently conducted.
E. Payment of Dividends. Except for dividends accruing after the
applicable Restricted Period (as defined in each Preferred Dividend
Agreement) on preferred stock on which Xxxxxx is obligated to pay pursuant
to the terms of the Preferred Dividend Agreements made by and among Xxxxxx
and certain preferred stockholders dated prior to December 31, 1997.
Declare or pay any dividends upon its shares of stock now or hereafter
outstanding or make any distribution of assets to its stockholders as such,
whether in cash, property, or securities, except dividends payable in
shares of capital stock and cash in lieu of fractional shares or in
options, warrants, or other rights to purchase shares of capital stock.
F. Purchase or Retirement of Stock. Acquire, purchase, redeem, or
retire any shares of its capital stock now or hereafter outstanding, except
on terms and conditions approved by Lender.
G. Investments; Advances. Make or commit to make any advance, loan, or
extension of credit or capital contribution to, or purchase any stock,
bonds, notes, debentures, or other securities of, or make any other
investment in, any Person, except short-term cash management programs.
H. Sale of Assets. Sell, lease, assign, transfer, or otherwise dispose
of any of its assets (other than obsolete or worn-out property), whether
now owned or hereafter acquired, other than in the ordinary course of
business as presently conducted and at fair market value.
I. ERISA.
i. Terminate or withdraw from any Plan so as to result in any
material liability to the PBGC;
ii. Engage in or permit any person to engage in any Prohibited
Transaction involving any Plan that would subject Xxxxxx to any
material tax, penalty, or other liability;
iii. Incur or suffer to exist any material Accumulated Funding
Deficiency, whether or not waived, involving any Plan;
iv. Allow or suffer to exist any event or condition that presents
a risk of incurring a material liability to the PBGC;
v. Amend any Plan so as to require the posing of security under
Section 401 (a)(29) of the Code; or
vi. Fail to make payments required under Section 412(m) of the
Code and Section 302(e) of ERISA that would subject Xxxxxx to any
material tax, penalty, or other liability.
7. Events of Default
Upon the occurrence of any of the following events (an Event of Default):
X. Xxxxxx shall fail to pay any principal on the Loans on the date when due
or fail to pay within five days of the date when due any other Obligation under
the Loan Documents; or
B. Any representation or warranty made by Xxxxxx in any Loan Document or in
connection with any Loan Document shall be inaccurate or incomplete in any
respect on or as of the date made; or
X. Xxxxxx shall fail to maintain its corporate existence or shall default
in the observance or performance of any covenant or agreement contained in
previous paragraphs 5(J) or 6; or
X. Xxxxxx shall fail to observe or perform any other term of provision
contained in the Loan Documents and such failure shall continue for thirty (30)
days; or
X. Xxxxxx shall default in any payment of principal or interest on any
Indebtedness (other than the Obligations) or any other event shall occur, the
effect of which is to permit such Indebtedness to be declared or otherwise to
become due prior to its stated maturity; or
F. (i) Xxxxxx shall commence any case, proceeding or other action (A) under
any existing or future law of any jurisdiction, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, or relief of debtors, seeking to have an
order for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition, or other relief with respect
to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, or other similar officials for it or for all or any substantial part
of its assets, or shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against Xxxxxx any case, proceeding
or other action of a nature referred to previously in clause (i) that (A)
results in the entry of an order for relief or any such adjudication or
appointment; (B) remains undismissed, undischarged, or unbonded for a period of
sixty (60) days; (iii) there shall be commenced against Xxxxxx or any of its
Subsidiaries, any case, proceeding or other action seeking issuance of a warrant
of attachment, execution, distraint, or similar process against all or
substantially all of its assets that results in the entry of an order for any
such relief that shall not have been vacated, discharged, stayed, satisfied, or
bonded pending appeal within sixty (60) days from the entry thereof; (iv) shall
take any action in furtherance of, or indicating its consent to, approval of,
acquiescence in (other than in connection with a final settlement), any of the
acts set forth in clause (i), (ii), or (iii) above; or (v) Xxxxxx, shall
generally not, or shall be unable to, or shall admit in writing its inability to
pay its debts as they become due; or
G. (i) Any Reportable Event or a Prohibited Transaction shall occur with
respect to any Plan; (ii) a notice of intent to terminate a Plan under Section
4041 of ERISA shall be filed; (iii) a notice shall be received by the plan
administrator of a Plan that the PBGC has instituted proceedings to terminate a
Plan or appoint a trustee to administer a Plan; (iv) any other event or
condition shall exist that might, in the opinion of the Lender, constitute
grounds under Section 4042 of ERISA for the termination of, or the appointment
of a trustee to administer, any Plan; or (v) Xxxxxx or any ERISA Affiliate shall
withdraw from a Multiemployer Plan under circumstances that the Lender
determines could have a material adverse effect on the financial condition of
Xxxxxx; or
H. One or more judgments or decrees shall be entered against Xxxxxx and all
such judgments or decrees shall not have been vacated, discharged, stayed,
satisfied, or bonded pending appeal within fifteen (15) days from the entry
thereof or in any event later than five days prior to the date of any proposed
sale thereunder; or
X. Xxxxxx shall voluntarily suspend the transaction of business for more
than five (5) days in any calendar year;
THEN, automatically upon the occurrence of an Event of Default under above, and
at the option of the Lender upon the occurrence of any other Event of Default,
the Lender's obligation to make Loans hereunder shall terminate and the
Obligations shall become due and payable, without demand upon or presentment to
Xxxxxx, which are expressly waived by Xxxxxx, and the Lender may immediately
exercise all rights, powers, and remedies available to it at law, in equity or
otherwise.
8. Miscellaneous Provisions
A. Confidentiality. The parties agree to keep confidential the information
provided under the terms of this Agreement subject to such disclosures as shall
be required by governmental authority or court order.
B. No Assignment. Xxxxxx may not assign its rights or obligations under
this Agreement without the prior written consent of the Lender. Subject to the
foregoing, all provisions contained in this Agreement or any document or
agreement referred to herein or relating hereto shall inure to the benefit of
the Lender, its successors and assigns, and shall be binding upon Xxxxxx, its
successors and assigns.
C. Amendment,- No Waiver. This Agreement may not be amended or terms or
provisions hereof waived unless such amendment or waiver is in writing and
signed by the Lender and Xxxxxx. It is expressly agreed and understood that the
failure by the Lender to elect to accelerate amounts outstanding hereunder
and/or to terminate the obligation of the Lender to make Loans hereunder shall
not constitute an amendment or waiver of any term or provision of this
Agreement. No delay or failure by the Lender to exercise any right, power, or
remedy shall constitute a waiver thereof by the Lender, and no single or partial
exercise by the Lender of any right, power, or remedy shall preclude other or
further exercise thereof or any exercise of any other rights, powers, or
remedies.
D. Cumulative Rights. The rights, powers, and remedies of the Lender
hereunder are cumulative and in addition to all rights, powers, and remedies
provided under any and all agreements between Xxxxxx and the Lender relating
hereto, at law, in equity or otherwise.
E. Entire Agreement. This Agreement and the documents and agreements
referred to herein embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings relating to
the subject matter hereof and thereof.
F. Survival. All representations, warranties, covenants, and agreements
herein contained on the part of Xxxxxx shall survive the termination of this
Agreement and shall be effective until the Obligations are paid and performed in
full or longer as expressly provided herein.
G. Notices. All notices, consents, requests, and demands to or upon the
respective parties hereto shall be in writing, and shall be deemed to have been
given or made when delivered in person to those Persons listed on the signature
pages hereof or when deposited in the U.S. mail, postage prepaid, or, in the
case of telegraphic notice or the overnight courier services when delivered to
the telegraph company or overnight courier service, or in the case of telex or
telecopy notice, when sent, verification received, in each case addressed as set
forth on the signature pages hereof, or such other address as either party may
designate by notice to the other in accordance with the terms of this paragraph
8(f).
H. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of Nebraska, without giving effect to choice of law
rules.
I. Counterparts. This Agreement and the other Loan Documents may be
executed in any number of counterparts, all of which together shall constitute
one agreement.
J. Accounting Terms. All accounting terms not otherwise defined herein are
used with the meanings given such terms under GAAP.
9. Definitions
For purposes of this Agreement, the terms set forth below shall have the
following meanings:
"Accumulated Funding Deficiency" shall mean a funding deficiency described
in Section 302 of ERISA.
"Affiliate" shall mean, as to any corporation, any other corporation
directly or indirectly controlling, controlled by or under direct or indirect
common control with, such corporation. "Control" as used herein means the power
to direct the management and policies of such corporation.
"Agreement" shall mean this Agreement, as the same may be amended,
extended, or replaced from time to time.
"Business Day" shall mean any day other than a Saturday, a Sunday, or a day
on which banks in Nebraska are authorized or obligated to close their regular
banking business.
"Code" shall mean the Internal Revenue Code of 1986, as amended, and the
rules and regulations issued thereunder as form time to time in effect.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations issued thereunder as from time to time in
effect.
"ERISA Affiliate" shall mean each trade or business, including Xxxxxx,
whether or not incorporated, which together with Xxxxxx would be treated as a
single employer under Section 4001 of ERISA.
"Event of Default" shall have the meaning given such term in previous
paragraph 7.
"Final Maturity Date" shall mean the earlier of (a) September 30, 1999; and
(b) the date the Lender accelerates payment of the Term Loan pursuant to
previous paragraph 7.
"GAAP" shall mean generally accepted accounting principles in the United
States in effect from time to time.
"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof, or any entity exercising executive,
legislative, judicial, regulatory, or administrative functions of or pertaining
to government.
"Indebtedness" of any Person shall mean all items of indebtedness which, in
accordance with GAAP and practices, would be included in determining liabilities
as shown on the liability side of a statement of condition of such Person as of
the date as of which indebtedness is to be determined, including, without
limitation, all obligations for money borrowed and capitalized lease
obligations, and shall also include all indebtedness and liabilities of others
assumed or guaranteed by such Person or in respect of which such Person is
secondarily or contingently liable (other than by endorsement of instruments in
the course of collection) whether by reason of any agreement to acquire such
indebtedness or to supply or advance sums or otherwise.
"Lien" shall mean any security interest, mortgage, pledge, lien, claim on
property, charge, or encumbrance (including any conditional sale or other title
retention agreement), any lease in the nature thereof, and the filing of or
agreement to give any financing statement under the Uniform Commercial Code of
any jurisdiction.
"Loan Documents" shall mean this Agreement, the Note, the Security
Agreement in the form of Exhibit 9 and the Options, and each other document,
instrument, and agreement executed by Xxxxxx in connection herewith or
therewith, as any of the same may be amended, extended, or replaced from time to
time.
"Multiemployer Plan" shall mean a Plan described in Section 4001(a)(3) of
ERISA to which Xxxxxx or any ERISA Affiliate is required to contribute on behalf
of any of its employees.
"Note" shall have the meaning previously given such term in paragraph 2(b).
"Obligations" shall mean any and all debts, obligations, and liabilities of
Xxxxxx to the Lender (whether principal, interest, fees, or other-wise, whether
now existing or hereafter arising, whether voluntary or involuntary, whether or
not jointly owed with others, whether direct or indirect, absolute or
contingent, contractual or tortious, liquidated or unliquidated, arising by
operation or law or otherwise, whether or not from time to time decreased or
extinguished and later increased, created, or incurred and whether or not
extended, modified, rearranged, restructured, refinanced, or replaced, including
without limitation, modifications to interest rates or other payment terms of
such debts, obligations, or liabilities).
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereto.
"Permitted Secured Debt" shall mean that indebtedness described in
paragraph 6(b)(iv) of this Agreement.
"Person" shall mean any corporation, natural person, firm, joint venture,
partnership, trust, unincorporated organization, government, or any department
or agency of any government.
"Plan" shall mean any plan (other than a Multiemployer Plan) subject to
Title IV of ERISA maintained for employees of Xxxxxx or any ERISA Affiliate (and
any such plan no longer maintained for employees of Xxxxxx or any of its ERISA
Affiliates to which Xxxxxx or any of its ERISA Affiliates has made or was
required to make any contributions during the five years preceding the date on
which such plan ceased to be maintained).
"Potential Default" shall mean an event that but for the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
"Prime Rate" shall mean the fluctuating per annum rate published from time
to time in the Wall Street Journal as the "Prime Rate".
"Prohibited Transaction" shall mean any transaction described in Section
406 of ERISA that is not exempt by reason of Section 408 of ERISA or the
transitional rules set forth in Section 414(c) of ERISA and any transaction
described in Section 4975(c)(1) of the Code, which is not exempt by reason of
Section 4975(c)(2) or Section 4975(d) of the Code, or the transitional rules of
Section 2003(c) of ERISA.
"Property" shall mean, collectively and severally, any and all real
property, including all improvements and fixtures thereon, owned or occupied by
Xxxxxx.
"Reportable Event" shall mean any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, a withdrawal from a Plan
described in Section 4063 of ERISA, a cessation of operations described in
Section 4068(f) of ERISA, an amendment to a Plan necessitating the posting of
security under Section 401 (a)(29) of the Code, or a failure to make a payment
required by Section 412(m) of the Code and Section 302(e) of ERISA when due.
"Requirements of Law" shall mean as to any Person the Certificate of
Incorporation and Bylaws or other organizational or governing documents of such
Person, and any law, treaty, rule, or regulation, or a final and binding
determination of an arbitrator or a determination of a court or other
Governmental Authority, in each case applicable to or binding upon such Person
or any of its property or to which such Person or any of its property is
subject.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
XXXXXX, INC., a Delaware TRANSACTION SYSTEMS ARCHITECTS, INC.,
Corporation a Delaware Corporation
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxxxxx Xxxxx
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Title: Chief Financial Officer Title: Chief Financial Officer
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