AMENDED AND RESTATED EQUIPMENT FACILITY
AND REVOLVING CREDIT AGREEMENT
This EQUIPMENT FACILITY AND REVOLVING CREDIT AGREEMENT
(together with all exhibits hereto and any amendments and
modifications hereto in effect from time to time, this "Agreement") is
made as of this _____ day of ________, 1997, by and between SUMMIT
BANK (the "Bank") a banking corporation organized under the laws of
the State of New Jersey, TOTAL-TEL USA COMMUNICATIONS, INC., a New
Jersey corporation ("Total-Tel Comm"), TOTAL-TEL, INC., a New Jersey
corporation and wholly owned subsidiary of Total-Tel Comm ("Total-
Tel"), TOTAL-TEL USA, INC., a New Jersey corporation and wholly owned
subsidiary of Total-Tel Comm ("Total-Tel USA"), TOTAL-TEL CARRIER
SERVICES, INC., a New Jersey corporation and wholly owned subsidiary
of Total-Tel Comm ("Total-Tel Carrier"), and TOTAL-TEL INTERNATIONAL,
INC., a ________________ corporation and wholly owned subsidiary of
Total-Tel Comm ("Total-Tel International"), TOTAL-TEL SOUTHEAST, INC.,
a Georgia corporation and wholly owned subsidiary of Total-Tel Comm
("Total-Tel Southeast"), TOTAL-TEL SERVICES, INC., a New Jersey
corporation and wholly owned subsidiary of Total-Tel Comm ("Total-Tel
Services"), TOTAL-TEL FLORIDA, INC., a New Jersey corporation and
wholly owned subsidiary of Total-Tel Comm ("Total-Tel Florida"), and
TOTAL-TEL U.K., LTD., a corporation organized under the laws of the
United Kingdom and a wholly owned subsidiary of Total-Tel Comm
("Total-Tel U.K."), Total-Tel Comm, Total-Tel, Total-Tel USA, Total-
Tel Carrier Total-Tel International, Total-Tel Southeast, Total-Tel
Services, Total-Tel Florida and Total-Tel U.K. are hereafter each
referred to as a "Borrower" and collectively referred to as the
"Borrowers").
BACKGROUND
WHEREAS, pursuant to that certain Equipment Facility and
Revolving Credit Agreement dated August 23, 1996 (the "1996
Agreement"), the Bank made available to Total-Tel Comm, Total-Tel,
Total-Tel USA and Total-Tel Carrier an equipment purchase facility in
the principal amount of up to $6,000,000 (the "1996 Equipment
Facility") for the purpose of financing the acquisition from time to
time of certain digital switching equipment and related computer
equipment to be used in the operation of such Borrowers' long distance
telephone service business ("Financed Equipment"); and
WHEREAS, pursuant to the 1996 Agreement, the Bank further made
available to Total-Tel Comm, Total-Tel, Total-Tel USA and Total-Tel
Carrier a committed revolving credit facility, pursuant to which such
Borrowers were able to request advances from time to time in a
principal amount of up to $4,000,000 outstanding at any time (the
"1996 Revolving Credit Facility"); and
WHEREAS, Total-Tel Comm, Total-Tel, Total-Tel USA and Total-Tel
Carrier have requested that the Bank amend the 1996 Agreement to make
available to the Borrowers, in addition to the amounts outstanding
pursuant to the 1996 Equipment Facility which, as of the date hereof
totals $___________, an equipment purchase facility in a maximum
principal amount of up to $5,000,000 for the purpose of financing the
acquisition of Financed Equipment; and
WHEREAS, Total-Tel Comm, Total-Tel, Total-Tel USA and Total-Tel
Carrier have further requested that the Bank amend the 1996 Agreement
to include Total-Tel International, Total-Tel Souteast, Total-Tel
Services, Total-Tel Florida and Total-Tel U.K. as Borrowers under both
the Equipment Facility and the Revolving Credit Facility, and to
increase the maximum principal amount of the 1996 Revolving Credit
Facility to $8,000,000 outstanding at any time; and
WHEREAS, the Bank is willing to amend and restate the 1996
Agreement in order to make available to the Borrowers such equipment
purchase facility and committed revolving credit facility upon the
terms and conditions herein stated;
AGREEMENT
NOW THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, and intending to be
legally bound hereby, the Bank and the Borrowers agree as follows:
I. THE CREDIT ACCOMMODATIONS
1.01 Equipment Facility. Subject to the terms and conditions
herein set forth, during the Equipment Facility Commitment Period, the
Bank agrees to make available to the Borrowers, on a joint and several
basis, an equipment finance facility (the "Equipment Facility"), under
which the Bank shall make advances (each an "Equipment Loan" and
collectively the "Equipment Loans") to the Borrowers from time to time
to finance the acquisition of Financed Equipment. Amounts borrowed
under the Equipment Facility and repaid may not be reborrowed. The
amounts outstanding under the Equipment Facility shall be evidenced by
a single promissory note, substantially in the form of Exhibit A
hereto (together with any attachments thereto and amendments or
modifications thereof in effect from time to time, the "Equipment
Facility Note"). During the Equipment Facility Commitment Period, the
Equipment Loans may be made as Prime Rate Loans or LIBOR Loans, as
requested by the relevant Borrower pursuant to the notice of borrowing
delivered with respect thereto pursuant to Section 1.03 hereof. Upon
the conversion of the Equipment Loans into a single term loan pursuant
to Section 1.04 hereof, such Loan shall be a Fixed Rate Loan.
1.02 Equipment Facility Maximum Principal Amount. The
maximum aggregate principal amount of Equipment Loans outstanding at
any time, not including the amounts outstanding pursuant to the 1996
Equipment Facility, which as of the date hereof totals $_________,
shall not exceed FIVE MILLION 00/100 DOLLARS ($5,000,000.00), such
amount being hereinafter referred to as the "Maximum Equipment
Facility Principal Amount". If the aggregate principal amount of
Equipment Loans outstanding at any time under the Equipment Facility
exceeds the Maximum Equipment Facility Principal Amount, then the
Borrowers shall immediately repay to the Bank the amount of such
excess.
1.03 Borrowing Procedures Under Equipment Facility. If a
Borrower desires to borrow under the Equipment Facility, the relevant
Borrower shall give the Bank an irrevocable notice of the amount and
date of such borrowing by no later than 3 Business Days prior to the
proposed borrowing. Such notice shall be in the form of the "Notice
of Borrowing Under Equipment Facility" attached hereto as Exhibit B
and shall be accompanied by (i) a true and complete description of the
Financed Equipment and the location (or proposed location) of such
equipment, and (ii) a true and correct copy of the vendor's invoice or
xxxx of sale, as the case may be, rendered in connection with the
purchase of such equipment. Upon receipt of any such notice, the Bank
may, in its sole discretion, request any documents or instruments
(including, without limitation, additional financing statements and/or
certificate or documents of title) that are necessary or advisable in
order to assure the Bank's first priority security interest in the
relevant Financed Equipment and in connection with such request, the
Bank may refuse or postpone the funding of the relevant Equipment Loan
until such time as the relevant Borrower has complied therewith. The
Borrowers shall pay to the Bank on demand the costs to be incurred in
connection with the filing or recordation of any such document or
instrument so requested. The principal amount of any Equipment Loan
requested hereunder shall not exceed eighty percent (80%) of the
purchase price of the relevant Financed Equipment as stated on the
invoice or xxxx of sale accompanying the relevant notice of borrowing,
but in no event shall any Equipment Loan be in a principal amount of
less than $50,000.00.
1.04 Conversion of Equipment Loan to a Term Loan. Subject to the
terms and conditions hereof (including, without limitation, the
conditions set forth in Section 6.02 hereof), by irrevocable written
notice given to the Bank by the Borrowers no later than 3 Business
Days prior to the proposed Conversion Date, the Borrowers may convert
the entire (and not less than the entire) aggregate outstanding
principal balance of the Equipment Loans to a single term loan (such
Loans, as so converted, the "Term Loan"); provided, however, that in
no event shall the Borrowers be permitted to so convert the Equipment
Loans if at the time of such conversion the aggregate principal
balance thereof is less than $2,000,000.00. The notice delivered
pursuant to the foregoing sentence shall state the effective date of
such conversion, which in no event shall be beyond the Equipment
Facility Expiration Date (the "Conversion Date"). If conversion is
permitted hereunder, then (i) the Term Loan shall mature and be due
and payable on the fifth (5th) anniversary of the Conversion Date (the
"Term Loan Maturity Date"), and (ii) effective as of the Conversion
Date, all Equipment Loans then outstanding shall be deemed
consolidated into a single Term Loan and all such Loans as so
consolidated shall be deemed refinanced as of the Conversion Date at
the interest rate basis (plus any applicable margin as set forth in
Section 1.05 hereof) selected by the Borrowers in the notice of
conversion delivered pursuant to this Section 1.04. If the Borrowers
select a Conversion Date which shall cause any then outstanding
Equipment Loan that is a LIBOR Loan to be deemed consolidated into the
Term Loan on any date other than the last day of the then expiring
Interest Period applicable thereto, then the Borrowers shall indemnify
the Bank for any loss or expense described in Section 4.05 hereof that
is incidental to such consolidation.
1.05 Interest on Equipment Loans/Term Loan. Prior to the
Conversion Date (if any), (i) interest on the Equipment Loan that is a
Prime Rate Loan shall accrue at a per annum rate equal to the Prime
Rate as in effect from time to time and be payable monthly, in
arrears, on each Payment Date during which such Loan is outstanding,
and upon payment in full of the aggregate outstanding balance thereof
and (ii) interest on each Equipment Loan that is a LIBOR Loan shall
accrue at a per annum rate equal to LIBOR plus 200 basis points (2.0%)
and shall be payable, in arrears, on each Payment Date during which
such Loan is outstanding, and upon payment in full of the outstanding
balance of such Loan. Upon conversion of the Equipment Loans to a
Term Loan, interest shall accrue thereon from the Conversion Date at a
per annum rate equal to the Fixed Rate plus 150 basis points (1.50%)
and shall be payable in arrears on the dates on which principal shall
be payable thereon pursuant to Section 1.06 hereof, and upon payment
in full of the principal balance thereof.
1.06 Equipment Loans/Term Loan Principal Payment Terms. If
the Equipment Loans are not converted to a Term Loan pursuant to
Section 1.04 hereof, the aggregate outstanding balance thereof,
together with any accrued and unpaid interest thereon, shall be due
and payable on the Equipment Facility Expiration Date. If the
Equipment Loans are converted to a Term Loan pursuant to Section 1.04
hereof, then the outstanding principal balance thereof shall be
payable in consecutive monthly installments pursuant to a level
principal and interest amortization schedule that would fully amortize
the Term Loan over a 5 year term. The Borrowers may elect the
foregoing level amortization option by giving irrevocable written
notice thereof to the Bank at least 3 Business Days prior to the
Conversion Date. Upon such election, the Bank shall promptly (but in
no event later than 2 Business Days prior to the Conversion Date)
deliver to the Borrowers an amortization schedule of payments and
payment dates reflecting such level principal and interest
amortization and, absent manifest error in the determination thereof,
principal and interest on the Term Loan shall be payable in accordance
therewith. In any event, the final installment of principal on the
Term Loan shall be due and payable on the Term Loan Maturity Date and
shall be in an amount equal to the then remaining unpaid principal
balance thereof, together with any accrued and unpaid interest
thereon.
1.07 Conversion of 1996 Equipment Facility. Pursuant to the
terms and conditions of the 1996 Agreement, on ________ ___, 19__, the
entire aggregate outstanding principal balance of the advances made
under the 1996 Equipment Facility (the "1996 Equipment Loans") was
converted to a single term loan (the "1996 Term Loan"), which is
evidenced by a term note in the form of "Equipment Facility/Term Note"
attached hereto as Exhibit C (the "1996 Term Note").
1.08 The Revolving Credit Facility. Subject to the terms and
conditions hereof, the Bank agrees to make available to the Borrowers,
on a joint and several basis, a revolving credit facility (the
"Revolving Credit Facility") under which the Bank shall make advances
to the Borrowers from time to time during the Revolving Credit
Commitment Period in an aggregate principal amount outstanding at any
one time of up to EIGHT MILLION 00/100 DOLLARS ($8,000,000.00) (each a
"Revolving Credit Loan" and collectively the "Revolving Credit
Loans"). During the Revolving Credit Commitment Period, the Borrowers
may borrow, repay and reborrow as provided herein. Revolving Credit
Loans may be made as Prime Rate Loans or LIBOR Loans, as requested by
the relevant Borrower pursuant to Section 1.12 hereof. The Revolving
Credit Loans shall be evidenced by a single promissory note,
substantially in the form of Exhibit D hereto (together with any
attachments thereto and/or amendments or modifications thereof in
effect from time to time, the "Revolving Credit Note").
1.09 Revolving Credit Facility Maximum Principal Amount. The
maximum aggregate principal amount of the Revolving Credit Loans
outstanding at any time, when added to the Letter of Credit
Outstanding at such time shall not exceed EIGHT MILLION 00/100 DOLLARS
($8,000,000.00), such amount being hereinafter referred to as the
"Maximum Revolving Credit Principal Amount". If the aggregate
outstanding principal amount of the Revolving Credit Loans plus the
Letters of Credit Outstanding at any time exceed the Maximum Revolving
Credit Principal Amount, the Borrowers shall immediately repay to the
Bank the amount of such excess.
1.10 Letter of Credit Sub-Facility. Within the limitations
of the Revolving Credit Facility herein set forth, the Borrowers may
from time to time request that the Bank issue irrevocable standby or
commercial letters of credit for the account of the relevant Borrower
and in support of any obligation deemed acceptable by the Bank in its
sole discretion (any such letter of credit so issued, a "Letter of
Credit" and collectively the "Letters of Credit"). Notwithstanding
the foregoing (i) no Letter of Credit shall be issued by the Bank in a
Stated Amount which (x) when added to the Letters of Credit
Outstanding at such time, would exceed $1,000,000.00 or (y) when added
to the sum of the aggregate outstanding principal amount of the
Revolving Credit Loans plus the Letter of Credit Outstanding, at such
time, would exceed the Maximum Revolving Credit Principal Amount.
Each Letter of Credit issued in accordance herewith shall have an
expiration date occurring no later than one year from the date of
issuance and in any event no later than (i) 6 months, in the case of
commercial letters of credit, and (ii) 1 year, in the case of
irrevocable automatically renewable letters of credit, after the
Revolving Credit Expiration Date. Each Letter of Credit shall be
denominated in U.S. dollars. When a Borrower desires that a Letter of
Credit be issued for its account, it shall give the Bank at least 3
Business Days' written notice (or such lesser number of days as may be
agreed to by the Bank). Each such request shall be accompanied by a
completed and executed "Letter of Credit Application/Agreement" (or an
amendment to any then effective application) in the form furnished by
the Bank to the Borrowers from time to time. The terms of each such
application/agreement are incorporated herein to the extent not
consistent herewith. In connection with the issuance of any Letters
of Credit in accordance herewith, the Borrowers shall pay all letter
of credit fees and other expenses that are customarily charged by the
Bank in connection therewith.
1.11 Interest on Revolving Credit Loans. Interest on each
Revolving Credit Loan that is a Prime Rate Loan shall accrue at the
Prime Rate (with no margin) and shall be payable monthly, in arrears,
on each Payment Date during which such Loan is outstanding, and upon
payment in full of the outstanding balance of such Loan. Interest on
each Revolving Credit Loan that is a LIBOR Loan shall accrue at LIBOR
plus 200 basis points (2.0%) and shall be payable, in arrears, on each
Payment Date during which such Loan is outstanding, and upon payment
in full of the outstanding balance of such Loan.
1.12 Revolving Credit Principal Payment Terms. The aggregate
outstanding principal balance of the Revolving Credit Loans, together
with all accrued and unpaid interest thereon, shall be due and payable
on the Revolving Credit Expiration Date.
1.13 Borrowing Procedures Under the Revolving Credit
Facility. If a Borrower desires to borrow under the Revolving Credit
Facility, such Borrower shall give the Bank irrevocable written notice
of the amount and date of such borrowing no later than 1 Business Day
prior to the date of such proposed borrowing in the case of Prime Rate
Loans and 3 Business Days prior to the date of such proposed borrowing
in the case of LIBOR Loans. Such notice shall be in the form of a
"Notice of Borrowing Under Revolving Credit" attached hereto as
Exhibit E. Each borrowing under the Revolving Credit Facility shall
be in an amount equal to $50,000.00 or any whole multiple thereof.
1.14 Revolving Credit Interest Conversion and Continuance
Options.
(a) Subject to the limitation of the last sentence of
Section 1.13 hereof, during the Revolving Credit Commitment Period,
the Borrowers may elect to convert any Revolving Credit Loan to a Loan
maintained at the other rate of interest available for Revolving
Credit Loans hereunder by giving the Bank irrevocable notice (which
may be telephone notice promptly confirmed in writing) of such
election at least 3 Business Days prior to the conversion to a LIBOR
Loan and at least 1 Business Day prior to the conversion to a Prime
Rate Loan. Said notice shall specify, in the case of a conversion to
a LIBOR Loan, the desired Interest Period with respect thereto, which
shall be either 1, 2 or 3 months in duration as selected by the
relevant Borrower. Conversions of LIBOR Loans to Prime Rate Loans
shall be made only on the last day of the Interest Period applicable
thereto. Conversions of Prime Rate Loans to LIBOR Loans shall only be
made on a Business Day.
(b) During the Revolving Credit Commitment Period, the
Borrowers may elect to continue any Revolving Credit Loan that is a
LIBOR Loan as such upon the expiration of the then current Interest
Period with respect thereto by giving the Bank an irrevocable notice
(which may be telephone notice promptly confirmed in writing) of such
election at least 3 Business Days prior to the expiration of the then
current Interest Period with respect thereto. Such notice shall also
specify the desired Interest Period for the Loan so continued, which
may be 1, 2 or 3 months in duration as selected by the relevant
Borrower.
(c) If the Borrowers fail to notify the Bank of the
conversion or continuance of any LIBOR Loan within the time specified
in this Section 1.14, then any such Loan shall automatically convert
to a Prime Rate Loan on the last day of the then expiring applicable
Interest Period.
1.15 Computation. Interest and any fees or compensation
based upon a per annum rate shall be calculated on the basis of a 360
day year for the actual number of days elapsed.
1.16 Payments Generally. All payments made hereunder shall
be paid in accordance with the payment terms set forth in the Notes.
II. DEFINITIONS.
2.01 Defined Terms. The following terms used throughout this
Agreement shall have the meanings assigned below:
Amended and Restated Security Agreement. The term "Amended and
Restated Security Agreement" means that certain Amended and Restated
Security Agreement of the Borrowers in favor of the Bank of even date
herewith.
Approved Subordinated Indebtedness. The term "Approved
Subordinated Indebtedness" means any Indebtedness of a Borrower that
(i) is subordinated to the Obligations on terms and conditions
approved in writing by the Bank and (ii) does not constitute
Guaranteed Indebtedness of such Borrower or any Borrower, or any
Subsidiary or affiliate thereof.
Business Day. The term "Business Day" means any day other
than a Saturday, Sunday, or a day on which commercial banks are
authorized or obligated by law or executive order to be closed in the
State of New Jersey.
Capitalized Lease. The term "Capitalized Lease" means any
lease with respect to which the obligation to pay rent or other
amounts constitutes Capitalized Lease Obligations.
Capitalized Lease Obligations. The term "Capitalized Lease
Obligations" means obligations to pay rent or other amounts under a
lease of (or other agreement conveying the right to use) real and/or
personal property which obligations are required to be classified and
accounted for as capital leases on a balance sheet in accordance with
GAAP.
Closing Date. The term "Closing Date" means the date on
which the conditions set forth in Section 5.01 hereof have been
fulfilled to the satisfaction of the Bank.
Conversion Date. The term "Conversion Date" shall have the
meaning assigned to such term in Section 1.04 hereof.
Credit Documents. The term "Credit Documents" means this
Agreement, the Notes, the Amended and Restated Security Agreement, the
Guaranties, any Letters of Credits and any letter of credit
agreement/application executed in connection with the issuance
thereof, each of the other documents referenced in the Closing
Checklist attached hereto as Exhibit F, each of the "Credit Documents"
referenced therein, and all other all credit accommodations, notes,
loan agreements, guaranties, security agreements, mortgages,
instruments, pledge agreements, assignments, acceptance agreements,
commitments, facilities, letters of credit, reimbursement agreements
and any other agreements and documents, between any Borrower and the
Bank, in each case now or hereafter existing, creating, evidencing,
guarantying, securing or relating to any or all of the Obligations,
together with in each case all amendments, modifications, renewals, or
extensions thereof.
Environmental Laws. The term "Environmental Laws" means all
applicable laws, regulations and other requirements of Governmental
Authorities relating to pollution or protection of the environment,
including laws relating to emissions, discharges, releases or
threatened releases of pollutants, contaminants, or hazardous or toxic
materials or wastes into ambient air, surface water, ground weather,
or land, or otherwise relating to the disposal, transport, or handling
of pollutants, contaminants, or hazardous or toxic material or wastes.
Equipment Facility. The term "Equipment Facility" shall
have the meaning assigned to such term in Section 1.01 hereof.
Equipment Facility Commitment Period. The term "Equipment
Facility Commitment Period" means the period commencing on the Closing
Date and ending on the Equipment Facility Expiration Date.
Equipment Facility Expiration Date. The term "Equipment
Facility Expiration Date" means the date that is the earlier to occur
of (i) February 28, 1999, or (ii) the Conversion Date.
Equipment Facility Note. The term "Equipment Facility Note"
shall have the meaning assigned to such term in Section 1.01 hereof.
Equipment Loan and Equipment Loans. The terms "Equipment
Loan" and "Equipment Loans" shall have the meanings assigned to such
terms in Section 1.01 hereof.
Event of Default. The term "Event of Default" shall have
the meaning assigned to such term in Article IX hereof.
Financed Equipment. The term "Financed Equipment" shall
have the meaning assigned to such term in the first recital clause of
this Agreement.
Fixed Rate. The term "Fixed Rate" means the highest asked
yield (rounded up to the next highest 1/8 of 1%) for "Govt. Bonds &
Notes", as set forth in the column designated "Treasury Bonds, Notes &
Bills" in The Wall Street Journal most recently published as of the
date that is 3 Business Days prior to the Conversion Date, having a
maturity date that falls in the same month as the Term Loan Maturity
Date, provided that if no such yield is published for the relevant
month, yields for the published month next succeeding and the
published month next preceding such month shall be used to determine
the Fixed Rate by interpolating such yields on a straight-line basis.
If The Wall Street Journal, at the time of determination of the Fixed
Rate, is no longer publishing the yields described above, then the
Bank shall determine such yield based on any other nationally
recognized source for such published yields as it may select in its
reasonable discretion.
Fixed Rate Loan. The term "Fixed Rate Loan" means the Term
Loan at all times during which such Loan bears interest based upon the
Fixed Rate.
GAAP. The term "GAAP" means generally accepted accounting
principles in effect from time to time in the United States.
Governmental Authority. The term "Governmental Authority"
means any nation or government, any state or other political
subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to
government.
Guaranteed Indebtedness. The term "Guaranteed Indebtedness"
means, as to any Person, all Indebtedness of the type referred to in
clauses (i) through (ix) of the definition of Indebtedness in this
Agreement guaranteed directly or indirectly in any manner by such
Person, or in effect guaranteed directly or indirectly by such Person,
or in effect guaranteed directly or indirectly by such Person through
an agreement (i) to pay or purchase such Indebtedness or to advance or
supply funds for the payment or purchase of such Indebtedness, (ii) to
purchase, sell or lease (as lessee or lessor) property, or to purchase
or sell services, primarily for the purpose of enabling the debtor to
make payment of such Indebtedness or to assure the holder of such
Indebtedness against loss, (iii) to supply funds to or in any other
manner invest in the debtor (including any agreement to pay for
property or services irrespective of whether or not such property is
received or such services are rendered), or (iv) otherwise to assure a
creditor against loss.
Guarantors. The term "Guarantors" means collectively Total-
Tel Comm, Total-Tel, Total-Tel USA, Total-Tel Carrier, Total-Tel
International, Total-Tel Southeast, Total-Tel Services, Total-Tel
Florida and Total-Tel U.K.
Guaranties. The term "Guaranties" means collectively the
Guaranty and Suretyship Agreement executed by the Guarantors in favor
of the Bank on even date herewith.
Indebtedness. The term "Indebtedness" means, as to any
Person (i) all indebtedness of such Person for borrowed money, (ii)
all obligations of such Person evidenced by bonds, debentures, notes,
or other similar instruments, (iii) all obligations of such Person to
pay the deferred purchase price of property or services, (iv) all
indebtedness created or arising under any conditional sale or other
title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller or lender
under such agreement in the event of default are limited to
repossession or sale of such property), (v) all Capitalized Lease
Obligations of such Person, (vi) all obligations, contingent or
otherwise, of such Person under acceptances, letters of credit or
similar facilities, (vii) all obligations of such Person to purchase,
redeem, retire, defease or otherwise acquire for value any capital
stock of such person or any warrants, rights or options to acquire
such capital stock, valued, in the case of redeemable preferred stock,
at the greater of its voluntary or involuntary liquidation preference
plus accrued and unpaid dividends, (viii) all obligations of such
Person in respect of interest rate swap agreements (as defined in 11
U.S.C. S101), currency swap agreements and other similar agreements
designed to hedge against fluctuations in interest rates or foreign
exchange rates, (ix) all obligations of production payments from
property operated by or on behalf of such Person and other similar
arrangements with respect to natural resources, (x) all Guaranteed
Indebtedness of such Person, and (xi) all Indebtedness of the type
referred to in clauses (i) through (x) above secured by (or for which
the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including, without
limitation, accounts and contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such Indebtedness.
Interest Period. The term "Interest Period" means, with
respect to any LIBOR loan:
(a) initially, the period commencing on, as the case may
be, the date of borrowing or conversion with respect to such LIBOR
Loan and ending 1, 2 or 3 months thereafter as selected by the
relevant Borrower (or the Borrowers) in the relevant notice with
respect thereto given pursuant to Section 1.03, 1.04, 1.12 or 1.14
hereof, as the case may be; and
(b) thereafter, each period commencing on the last day
of the next preceding Interest Period applicable to such LIBOR Loan
and ending 1, 2 or 3 months thereafter as selected by the relevant
Borrower in its notice of continuance as provided in Section
1.14(b)(b) hereof; provided that the foregoing provisions relating to
Interest Periods are subject to the following:
(i) if any Interest Period pertaining to a LIBOR
Loan would otherwise end on a day which is not a Business Day, that
Interest Period shall be extended to the next succeeding Business Day
unless the result of such extension would be to carry such Interest
Period into another calendar month in which even such Interest Period
shall end on the immediately preceding Business Day;
(ii) any Interest Period pertaining to a LIBOR Loan
that begins on the last Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end on the last
Business Day of a calendar month; and
(iii) no Borrower shall select any Interest Period
that (a) with respect to a Revolving Credit Loan, would extend such
Interest Period beyond the Revolving Credit Expiration Date, (and)
with respect to an Equipment Loan, would extend such Interest Period
beyond the Equipment Facility Expiration Date.
Letter of Credit and Letters of Credit. The terms "Letter
of Credit" and "Letters of Credit" shall have the meanings assigned to
such terms in Section 1.10 hereof.
Letter of Credit Outstanding. The term "Letter of Credit
Outstanding" means, at any time, the sum of, without duplication (i)
the aggregate Stated Amount of all outstanding Letters of Credit; (ii)
the aggregate amount of all unreimbursed drawing thereunder; and (iii)
the Stated Amount of all Letters of Credit requested in accordance
with Section 1.10 hereof but not yet issued.
LIBOR. The term "LIBOR" means, with respect to each day
during each Interest Period, the rate (rounded to the next higher
1/100 of 1%) for U.S. dollar deposits with a maturity equal to the
relevant Interest Period in the London interbank market as determined
by the Bank from a recognized source for quotations of the London
interbank offered rate, on the second London business day before the
relevant Interest Period begins, adjusted for reserves by dividing
that rate by 1.00 minus the LIBOR Reserve.
LIBOR Loan. The term "LIBOR Loan" means any Revolving
Credit Loan at all times during which such Loan bears interest based
upon LIBOR.
LIBOR Reserve. The term "LIBOR Reserve" means the maximum
percentage reserve requirement (rounded to the next higher 1/100 of 1%
and expressed as a decimal) in effect for any day during the relevant
Interest Period under the Federal Reserve Board's Regulation D for
Eurocurrency liabilities as defined therein.
Lien. The term "Lien" means any mortgage, pledge, security
interest, encumbrance, lien or other form of charge or preferential
arrangement of any kind (including, without limitation, any agreement
to give any of the foregoing, any conditional sale or other title
retention or any lease in the nature thereof).
Loan. The term "Loan" means a Revolving Credit Loan,
Equipment Loan, Term Loan or the 1996 Term Loan, as the context shall
require, and the term "Loans" means, collectively, the Revolving
Credit Loans, Equipment Loans, Term Loan and the 1996 Term Loan.
Material Adverse Effect. The term "Material Adverse Effect"
means a material adverse effect on (a) the business, operations,
property, condition (financial or otherwise) of Total-Tel Comm and its
Subsidiaries taken as a whole, (b) the ability of any Borrower to
perform their respective obligations under this Agreement, the Notes
or any of the other Credit Documents, or (c) the validity or
enforceability of this Agreement, the Notes or any of the other Credit
Documents, or the rights or remedies of the Bank hereunder or
thereunder.
Maximum Equipment Facility Principal Amount. The term
"Maximum Equipment Facility Principal Amount", shall have the meaning
assigned to such term in Section 1.02 hereof.
Maximum Revolving Credit Principal Amount. The term
"Maximum Revolving Credit Principal Amount" shall have the meaning
assigned to such term in Section 1.09 hereof.
Note. The term "Note" means the Equipment Facility Note,
the Revolving Credit Note or the 1996 Term Note, as the context shall
require, and the term "Notes" means, collectively, the Equipment
Facility Note, the Revolving Credit Note and the 1996 Term Note.
Obligations. The term "Obligations" means any and all
obligations and indebtedness of every kind and description of the
Borrowers owing to the Bank or to any Affiliate, whether under the
Credit Documents or other loan documents or agreements, and whether
such debts or obligations are primary or secondary, direct or
indirect, absolute or contingent, sole, joint or several, secured or
unsecured, due or to become due, contractual or tortious, arising by
operation of law or otherwise, or now or hereafter existing,
including, without limitation, principal, interest, fees, late fees,
expenses, attorneys' fees and costs and/or allocated fees and costs of
Bank's in-house legal counsel, that have been or may hereafter be
contracted or incurred.
Payment Date. The term "Payment Date" means (i) in the case
of a LIBOR Loan, the last day of each Interest Period applicable
thereto and (ii) in the case of a Prime Rate Loan, ,
1998 and the same day of each month occurring thereafter; provided,
however, on or about the Conversion Date, the Bank may adjust the
Payment Dates with respect to interest payable on the Term Loan to
cause such dates to coincide with the dates otherwise set for payment
of installment of principal pursuant to Section 1.06 hereof.
Permitted Investments. The term "Permitted Investments"
means (i) readily marketable direct obligations of the Government of
the United States of America or any agency or instrumentality thereof
or any full faith and credit obligations of the United States
Government or obligations guaranteed by the United States Government
and its agencies, (ii) any investment grade debt or equity securities
issued by any other Person, (iii) certificates of deposit of any
United States commercial bank, (iv) any investment arranged by the
Bank, or an affiliate of the Bank, on behalf of a Borrower pursuant to
cash management services provided to a Borrower by the Bank or such
affiliate, (v) instruments held for collection in the ordinary course
of business, and (vi) any equity or debt securities or other form of
debt instrument obtained in settlement of debts previously contracted.
Permitted Liens. The term "Permitted Liens" means those
Liens permitted to exist pursuant to Section 8.02 hereof.
Person. The term "Person" means any individual,
partnership, joint venture, firm, corporation, association, trust or
other enterprise or any government or political subdivision or any
agency, department or instrumentality thereof.
Prime Rate. The term "Prime Rate" means the per annum rate
of interest established by the Bank as its reference rate in making
loans, and does not reflect the rate of interest charged to any
particular borrower or class of borrowers. The Borrowers acknowledge
that the Prime Rate is not tied to any external rate of interest and
that the rate of interest charged hereunder shall change automatically
and immediately as of the date of any change in the Prime Rate,
without notice to the Borrowers.
Prime Rate Loan. The term "Prime Rate Loan" means any Loan
at all times during which such loan bears interest based upon the
Prime Rate.
Revolving Credit Commitment Period. The term "Revolving
Credit Commitment Period" mean the period commencing on the Closing
Date and ending on the Revolving Credit Expiration Date.
Revolving Credit Expiration Date. The term "Revolving
Credit Expiration Date" means May 31, 1998.
Revolving Credit Facility. The term "Revolving Credit
Facility" shall have the meaning assigned to such term in Section 1.08
hereof.
Revolving Credit Loan and Revolving Credit Loans. The terms
"Revolving Credit Loan" and "Revolving Credit Loans" shall have the
meanings assigned to such terms in Section 1.08 hereof.
Revolving Credit Note. The term "Revolving Credit Note"
shall have the meaning assigned to such term in Section 1.08 hereof.
SEC. The term "SEC" shall mean the Securities and Exchange
Commission or any Governmental Authority which may succeed to the
authority thereof or be substituted therefor.
Stated Amount. The term "Stated Amount" means with respect
to any Letter of Credit, the maximum amount available to be drawn
thereunder, determined without regard to whether any conditions to
drawing could then be met.
Subsidiary. The term "Subsidiary" means, as to any Person,
any corporation or other entity of which securities or other ownership
interests having ordinary voting power to elect a majority of the
board of directors or other persons performing similar functions, are
at the time directly or indirectly owned or controlled by such Person,
one or more of the other Subsidiaries of such Person, or any
combination thereof.
Term Loan. The term "Term Loan" shall have the meaning
assigned to such term in Section 1.04 hereof.
Term Loan Maturity Date. The term "Term Loan Maturity Date"
shall have the meaning assigned to such term in Section 1.04 hereof.
1996 Agreement. The term "1996 Agreement" shall have the meaning
assigned to such term in the first recital clause of this Agreement
1996 Equipment Facility. The term "1996 Equipment Facility"
shall have the meaning assigned to such term in the first recital
clause of this Agreement.
1996 Equipment Loan and 1996 Equipment Loans. The terms "1996
Equipment Loan" and "1996 Equipment Loans" shall have the meanings
assigned to such terms in Section 1.07 hereof.
1996 Revolving Credit Facility. The term "1996 Revolving Credit
Facility" shall have the meaning assigned to such term in the second
recital clause of this Agreement.
1996 Term Note. The term "1996 Term Note" shall have the
meaning assigned to such term in Section 1.07 hereof.
2.02 Principles of Construction.
(a) References. All references to articles, sections,
schedules and exhibits are to articles, sections, schedules and
exhibits in or to this Agreement unless otherwise specified. The
words "hereof", "herein", and "hereunder" and words of similar import
when used in this Agreement shall refer to this Agreement as a whole
and not to any particular provision of this Agreement.
(b) Accounting Terms. All accounting terms not
specifically defined herein or in any exhibit hereto shall be
construed in accordance with GAAP in conformity with those principles
used in the preparation of the financial statements referred to in
Section 6.04 hereof.
III. PREPAYMENT.
3.01 Prepayment of Revolving Credit Loans. The Revolving
Credit Loans may be prepaid, in whole or in part, at any time,
provided that any prepayment in respect of a LIBOR Loan shall be made
only on the last day of the Interest Period applicable thereto, and
provided, further, that any partial prepayments of the Revolving
Credit Loans shall be in a principal amount of not less than
$50,000.00, or any multiple thereof. All prepayments shall include
accrued and unpaid interest to the date of prepayment on the principal
amount prepaid. All partial prepayments received pursuant to this
Section 3.01 shall be applied to the Obligations that are in respect
of the Revolving Credit Loans in the manner determined by the Bank in
its reasonable discretion.
3.02 Prepayments of Equipment Loans and Term Loan. At any
time prior to the Conversion Date, the Equipment Loans may be prepaid,
in whole or in part at any time, without premium or penalty; provided,
that any partial prepayment of the Equipment Loans shall be in a
principal amount of not less than $50,000.00, or any multiple thereof.
All prepayments of the Equipment Loans shall include accrued and
unpaid interest to the date of prepayment on the principal amount
prepaid. The Term Loan and the 1996 Term Loan may be prepaid, in
whole or in part, at any time, provided, that any prepayment (whether
in whole or in part and whether made voluntarily or because of
acceleration) shall also be accompanied by an amount equal to (i) 2%
of the amount of the prepayment if the prepayment occurs during the
first or second year of the term of the Term Loan or the 1996 Term
Loan, as the case may be, or (ii) 1% of the amount of the prepayment
if the prepayment occurs during the third or fourth year of the term
of the Term Loan or the 1996 Term Loan, as the case may be. There
shall be no prepayment fee payable pursuant to this Section 3.02 if
the prepayment occurs during the fifth year of the term of the Term
Loan or the 1996 Term Loan, as the case may be. All partial
prepayments of principal balance of the Term Loan or the 1996 Term
Loan shall be applied to the such Loan in inverse order of maturity.
All prepayments of the Term Loan or the 1996 Term Loan shall also
include accrued and unpaid interest to the date of prepayment on the
principal amount prepaid.
IV. YIELD MAINTENANCE PROVISIONS.
4.01 Inability to Determine Rate. If with respect to any
Interest Period, the Bank determines that extraordinary and unforeseen
circumstances beyond the control of the Bank exists with respect to
the relevant market which make it impracticable to ascertain the
interest rate applicable for such Interest Period, the Bank shall
promptly notify the Borrowers of such determination. Upon such
determination, no additional LIBOR Loans shall be permitted under the
Revolving Credit Facility and no conversion to, or continuances of,
LIBOR Loans shall be permitted pursuant to Section 1.14 hereof until
the notice of such determination has been withdrawn. If such notice
has not been withdrawn by the last day of the then current Interest
Period applicable to any then outstanding LIBOR Loans, the Borrowers
must elect on the last day of such Interest Period to either convert
such LIBOR Loan to a Prime Rate Loan or prepay the outstanding
principal balance thereof and accrued interest thereon in full.
4.02 Illegality. Notwithstanding any other provisions
herein, if any law, regulation, treaty or directive or any change
therein or in the interpretation or application thereof, shall make it
unlawful for the Bank to make or maintain any of the Loans as LIBOR
Loans as contemplated by this Agreement, (i) the Bank's commitment
hereunder to make LIBOR Loans under the Revolving Credit Facility or
to permit conversions to, or continuances of, LIBOR Loans pursuant to
Section 1.14 hereof shall forthwith be suspended until the
circumstances surrounding such unlawfulness shall no longer exit and
(ii) any of the then outstanding LIBOR Loans shall be converted to a
Prime Rate Loan on the last day of the Interest Period applicable
thereto or within such earlier period as may be required by law.
4.03 Requirement of Law. In the event that any law,
regulation, treaty or directive or any change therein or in the
interpretation or application thereof or compliance by the Bank with
any request or directive (whether or not having the force of law) from
any central bank or other governmental authority, agency or
instrumentality:
(a) does or shall subject the Bank to any tax of any
kind whatsoever with respect to this Agreement, the Notes or any Loan
made hereunder, or change the basis of taxation of payments to the
Bank of principal, commitment fee, interest or any other amount
payable hereunder (except for changes in the rate of any tax presently
imposed on the Bank);
(b) does or shall impose, modify or hold applicable any
reserve, special deposit, compulsory loan or similar requirement
against assets held by, or deposits or other liabilities in or for the
account of, advances or loans by, or other credit extended by, or any
other acquisition of funds by, any office of the Bank which are not
otherwise included in the determination of LIBOR hereunder; or
(c) does or shall impose on the Bank any other
condition;
and the result of any of the foregoing is to increase the
cost to the Bank of making, renewing or maintaining advances or
extensions of credit to the Borrowers or to reduce any amount
receivable from the Borrowers hereunder then, in any such case, the
Borrowers shall promptly pay to the Bank, upon its demand, any
additional amounts necessary to compensate the Bank for such
additional cost or reduced amount receivable which the Bank deems to
be material as determined by the Bank with respect to this Agreement,
the Notes or the Loans made hereunder. If the Bank becomes entitled
to claim any additional amounts pursuant to this Section 4.03, it
shall promptly notify the Borrowers of the event by reason of which it
has become so entitled. A certificate setting forth calculations as
to any additional amounts payable pursuant to the foregoing sentence
submitted by the Bank to the Borrowers shall be conclusive in the
absence of manifest error.
4.04 Capital Adequacy. If after the date hereof, the Bank
shall have determined that the adoption of any applicable law, rule or
regulation regarding capital adequacy, or any change therein, or any
change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by the
Bank with any request or directive regarding capital adequacy (whether
or not having the force of law) of any such authority, central bank or
comparable agency, has or would have the effect of reducing the rate
of return on the Bank's capital as a consequence of its obligations
hereunder to a level below that which the Bank could have achieved but
for such adoption, change or compliance (taking into consideration the
Bank's policies with respect to capital adequacy) by an amount deemed
by the Bank to be material, then from time to time, within 30 days
after demand by the Bank, the Borrowers shall pay to the Bank such
additional amount or amounts as will compensate the Bank for such
reduction. The Bank will promptly notify the Borrowers of any event
of which it has knowledge, occurring after the date hereof, which will
entitle the Bank to compensation pursuant to this Section 4.04, and
such notification of the amount due pursuant to this Section 4.04
shall be conclusive absent manifest error. Notwithstanding anything
to the contrary set forth above, the Bank shall have no right to seek
additional compensation pursuant to this Section 4.04 until after the
Bank shall have allocated, and sought compensation for, such increased
costs fairly and equitably among all of its customers of the same
general class as the Borrowers that are generally affected by the
above set forth circumstances.
4.05 Indemnity. The Borrowers, jointly and severally, agree
to indemnify the Bank and to hold the Bank harmless from any loss or
expense which the Bank may sustain or incur as a consequence of (i)
default by any Borrower in payment of the principal of or interest on
the any LIBOR Loan, (ii) any prepayment of any LIBOR Loan received
(from any source) on any date other than the last day of the Interest
Period applicable thereto, (iii) default by any Borrower in making any
borrowing of a LIBOR Loan under the Equipment Facility or Revolving
Credit Facility, as the case may be, after such Borrower has given
notice thereof in accordance with Section 1.03 or 1.12 hereof, (iv)
default by any Borrower in making any prepayment after such Borrower
has given a notice thereof, or (v) the consolidation of any LIBOR Loan
into the Term Loan pursuant to Section 1.04 hereof on any date other
than the last day of the Interest Period applicable thereto. This
covenant shall survive termination of this Agreement and payment of
the Notes.
4.06 Match Funding. The amount payable or indemnifiable
under Sections 4.03, 4.04 and 4.05 hereof shall be determined, in the
Bank's sole discretion, based upon the assumption that the Bank funded
100% of any affected LIBOR Loan in the applicable London interbank
market.
V. CONDITIONS.
5.01 Requirements for Initial Funding. The obligation of the
Bank to make the initial advance of any Loan available hereunder is
subject to the Bank's receipt of each of the documents listed on the
Closing Checklist attached hereto as Exhibit F, and such other
documents as the Bank may reasonably request, each, as appropriate,
duly executed and delivered by the parties thereto and in form and
substance satisfactory to the Bank.
5.02 Requirements for Any Advance or Conversion. The
obligation of the Bank to (i) make any advance under the Revolving
Credit Facility or the Equipment Facility, or (ii) permit the
conversion of the Equipment Loans to the Term Loan pursuant to Section
1.04 hereof, or (iii) permit the conversion of any Revolving Credit
Loan to a LIBOR Loan pursuant to Section 1.14 hereof, is subject to
and conditioned upon the following:
(a) the representations and warranties contained in
Article VI hereof are correct on and as of the date of each such
advance, conversion or continuation;
(b) no Event of Default, and no event which, with the
giving of notice, or the passage of time, or both, would become an
Event of Default, has occurred and is continuing;
(c) there has been no material adverse change in the
Borrowers' condition, financial or otherwise, since the date of this
Agreement; and
(d) all of the Credit Documents remain in full force and
effect.
VI. REPRESENTATIONS AND WARRANTIES.
Each Borrower represents and warrants that:
6.01 Organization; Authority. Each Borrower (a) is a
corporation duly organized, validly existing and in good standing
under the laws of the State or jurisdiction of its organization, is
duly qualified as a foreign corporation and is in good standing under
the laws of each jurisdiction in which it is required to be qualified
because of the business it conducts or the property it owns, and (b)
has the necessary power and authority to enter into and perform its
obligations under the Credit Documents and all other documents
required by the Bank in connection therewith. The execution and
performance of the Credit Documents have been duly authorized by all
necessary proceedings on the part of each Borrower, and, upon their
execution and delivery, they will be valid, binding, and enforceable
in accordance with their terms. The execution and performance of the
Credit Documents by each Borrower will not violate any orders, laws or
regulations applicable to it, any of its organizational documents, or
any instruments, indentures or agreements (including any provisions
pertaining to subordinated debt) to which any Borrower is a party or
by which any Borrower or any of its assets is bound, except to the
extent that any such violation would not have a Material Adverse
Effect. All consents, approvals, licenses, franchises, trademarks and
other general intangibles that are necessary or appropriate in
connection with this Agreement, the other Credit Documents or the
operation of the business of each Borrower have been obtained and are
in full force and effect, except to the extent that any such failure
to so obtain and maintain such general intangibles would not have a
Material Adverse Effect.
6.02 Subsidiaries. The corporations listed on Annex I are
the only Subsidiaries of Total-Tel Comm and each such Subsidiary is a
corporation, duly organized, validly existing and in good standing,
under the law of the jurisdiction of its organization, is duly
qualified as a foreign corporation and is in good standing under the
law of each jurisdiction in which it is required to be qualified
because of the business it conducts or the property it owns and have
all necessary power and authority to own its property and conduct its
business, as contemplated to be conducted. All consents, approvals,
licenses, franchises, trademarks and other general intangibles that
are necessary or appropriate in connection with the operation of the
business of each Subsidiary, as contemplated to be operated, have been
obtained and are in full force and effect, except to the extent that
any such failure to so obtain and maintain such general intangibles
would not have a Material Adverse Effect. Each such Subsidiary is a
wholly owned Subsidiary of Total-Tel Comm and no other Person has any
direct or indirect interest in such Subsidiary, other than such
interests which may exist as a result of any stock ownership interest
of any Person in Total-Tel Comm.
6.03 Use of Proceeds; Margin Regulation. The proceeds of the
Equipment Loans shall be used exclusively to finance the acquisition
of Financed Equipment. The proceeds of borrowings under the Revolving
Credit Facility shall be used by the Borrowers for working capital and
other general corporate purposes. The Borrowers are not engaged in the
business of extending credit for the purpose of buying or carrying
"margin stock" (within the meaning of Regulation U issued by the Board
of Governors of the Federal Reserve System). Neither the making of
any Loan nor use of the proceeds thereof will violate or be
inconsistent with the provisions of Regulation G, T, U or X of the
Board of Governors of the Federal Reserve System.
6.04 Financial Statements. The audited consolidated
financial statements contained in the Form 10-K of Total-Tel Comm
filed with the SEC for the fiscal year ended January 31, 1997 and the
consolidated financial statements contained in the Form 10-Q of Total-
Tel Comm for the fiscal quarter ended October 31, 1997 were prepared
in accordance with GAAP, consistently applied, are true and correct in
all material respects, present fairly the financial condition of the
Borrowers, and, taken together, disclose all presently outstanding
indebtedness or obligations of the Borrowers, including contingent
obligations, obligations under leases of property from others, and all
liens and encumbrances, including tax liens, against its properties
and assets; and there have been no adverse changes in the Borrowers'
financial condition or business since the date of such statements.
6.05 Suits. Other than as disclosed on Annex I hereof, to
the best of each Borrower's knowledge there are no actions, suits,
proceedings, or claims pending or threatened against the Borrowers, or
any of their respective properties which, if adversely determined
against any Borrower, would have a Material Adverse Effect.
6.06 Defaults. None of the Borrowers is in default under any
agreement to which it is a party or by which it is or any of its
properties are bound, or under any indenture or instrument evidencing
any its indebtedness and neither the execution of nor performance by
any Borrower under the Credit Documents will create a default or any
lien or encumbrance under any such agreement, indenture or instrument
other than a lien or encumbrance in favor of the Bank, except, in each
case, to the extent that the occurrence of any such defaults or the
existence of any such liens would not have a Material Adverse Effect.
6.07 ERISA. No employee benefit plan established or
maintained by the Borrower which is subject to the Employee Retirement
Income Security Act, 29 U.S.C. _ 1001 et seq. ("ERISA") has an
accumulated funding deficiency (as such term is defined in ERISA). No
material liability to the Pension Benefit Guaranty Corporation (or any
successor thereto under ERISA) has been incurred by the Borrowers with
respect to any such plan and no Reportable Event under ERISA has
occurred. The Borrowers have no actual or anticipated liability under
Section 4971 of the Internal Revenue Code ("Code") (relating to tax on
failure to meet the minimum funding standard of Section 412 of the
Code) with respect to any employee benefit plan to which any of them
contributes but which is not maintained or established by any of them.
6.08 Tax Returns and Taxes. Each Borrower has filed all
federal, state and local tax returns required to be filed and has paid
all taxes, assessments and governmental charges and levies thereon,
including interest and penalties, except where the same are being
contested in good faith by appropriate proceedings and for which
adequate reserves have been set aside, and no liens for taxes have
been filed and no claims are being assessed by a Governmental
Authority with respect to any taxes or the charges, accruals and
reserves on the books of the Borrowers with respect thereto.
6.09 Compliance with Statutes, etc. To the best of each
Borrower's knowledge, ach Borrower is in compliance with all
applicable statutes, regulations and orders of, and all applicable
restrictions imposed by, any Government Authority, in respect of the
conduct of its business and the ownership of its property (including,
without limitation, any applicable Environmental Laws), except such
instances of noncompliances as would not have a Material Adverse
Effect.
6.10 Not an Investment Company. None of the Borrowers is an
"investment company" or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as
amended.
6.11 Intellectual Property, etc. The Borrowers have obtained
all material patents, trademarks, servicemarks, trade names,
copyrights, technology, processes, licenses and other rights
(Intellectual Property), free from any burdensome restrictions, that
are necessary for the operation of their respective businesses as
presently conducted and as proposed to be conducted. No claim has
been asserted or threatened questioning the use of such Intellectual
Property, nor does any Borrower know of any valid basis for any such
claim.
6.12 Assets and Properties. Each Borrower has good and
marketable title to all of its assets and properties (tangible and
intangible) and all such assets and properties are free and clear of
all Liens (except Permitted Liens). Substantially all of the assets
and properties owned by, leased to or used by each Borrower are in
adequate operating condition and repair, ordinary wear and tear
excepted, are free and clear of known defects except such defects as
do not substantially increase with the continued use thereof in the
conduct of normal operation, and such assets are able to serve the
function for which they are currently being used, except in each case,
where the failure of such asset or property to meet such requirements
would not have a Material Adverse Effect.
6.13 True and Complete Disclosure. All factual information
(taken as a whole) heretofore or contemporaneously furnished by the
Borrowers to the Bank for the purposes of or in connection with this
Agreement or any transactions contemplated herein is, and all other
such factual information (taken as a whole) hereafter furnished by or
on behalf of the Borrowers in writing to the Bank will be, true and
accurate in all material respects on the date as of which such
information is dated or certified and does not and shall not omit to
state any fact necessary to make such information (taken as a whole)
not misleading at such time in light of the circumstances under which
such information was provided.
6.14 Business Integration. The business operations of
Borrowers are related and have a common business purpose. To permit
the uninterrupted and continuous operations of their common economic
enterprise, such corporations now require and will from time to time
hereafter require funds for general business purposes. Accordingly,
the proceeds of Loans made hereunder will directly or indirectly
benefit each Borrower, regardless of which corporation actually or
directly receives part or all of the proceeds of such Loans.
VII. AFFIRMATIVE COVENANTS.
Total-Tel Comm and (as the context so requires) each of the other
Borrowers covenant and agree that so long as there are any outstanding
Obligations hereunder or otherwise or the Bank shall have any
commitments hereunder:
7.01 Financial Statements. Total-Tel Comm shall furnish to
the Bank the following financial information: (i) as soon as available
but in any event within 90 days after the close of each fiscal year of
Total-Tel Comm, to the extent prepared to comply with SEC
requirements, a copy of the SEC Form 10-K (or successor form
promulgated by the SEC) filed by Total-Tel Comm with the SEC for such
fiscal year, or, if no such form was so filed for such fiscal year,
consolidated audited year-end financial statements for Total-Tel Comm,
including, but not limited to, statements of financial condition,
income and cash flows, a reconciliation of net worth, notes and other
supporting schedules to such financial statements and any other
information that may assist the Bank in assessing the Borrowers'
financial condition (prepared in accordance with GAAP consistently
applied, and accompanied by an opinion, satisfactory in form and
substance to the Bank, by an independent certified public accountant
acceptable to the Bank, and certified as true, correct and complete in
all material respects by Total-Tel Comm's chief financial officer);
(ii) as soon as available but in any event within 45 days after each
interim fiscal quarter, to the extent prepared to comply with SEC
requirements, a copy of the SEC Form 10-Q (or successor form
promulgated by the SEC) filed by Total-Tel Comm with the SEC for such
fiscal quarter; or, if no such form was so filed for such fiscal
quarter, unaudited management prepared consolidated financial
statements for Total-Tel Comm for such quarter, including, but not
limited to, statements of financial condition, income and cash flows,
a reconciliation of net worth, and supporting schedules (prepared in
accordance with GAAP consistently applied, and certified as true,
correct and complete in all material respects by Total-Tel Comm's
chief financial officer); (iii) promptly upon filing the same with the
SEC, copies of any filings and registrations with, and reports to, the
SEC by Total-Tel Comm, including, but not limited to, any reports on
Form 8-K (or successor form promulgated by the SEC), or any proxy or
registration statement or any other form of public disclosure
prescribed by the SEC; and (iv) such other information respecting the
operations, financial or otherwise, of the Borrowers as the Bank may
from time to time reasonably request.
7.02 Compliance Certificate. Total-Tel Comm shall furnish to
the Bank, together with each set of financial statements described in
clauses (i) and (ii) of Section 7.01 hereof, a compliance certificate,
substantially in the form of Exhibit G hereto, signed by Total-Tel
Comm's chief financial officer, certifying that: (i) all
representations and warranties set forth in this Agreement and in the
other Credit Documents are true and correct as of the date thereof;
(ii) none of the covenants in this Agreement or in the other Credit
Document has been breached; and (iii) no event has occurred which,
alone, or with the giving of notice or the passage of time, or both,
would constitute an Event of Default under this Agreement or the other
Credit Documents.
7.03 Notice of Certain Events. The Borrowers shall promptly
give written notice to the Bank of: (i) the details of any Reportable
Events (as defined in ERISA) which have occurred, (ii) the occurrence
of any event which alone or with notice, the passage of time, or both,
would constitute an Event of Default, and (iii) the commencement of
any proceeding or litigation which, if adversely determined, would
have a Material Adverse Effect.
7.04 Preservation of Property; Insurance. Each Borrower
shall keep and maintain, and require each of the Guarantors to keep
and maintain, all of its and their properties and assets in good order
and repair; maintain extended coverage, general liability, hazard,
business interruption, property and other insurance in amounts deemed
satisfactory to the Bank and as is customary for businesses similar to
such Borrower's business and deliver to the Bank certificates of all
such insurance in effect; and cause all such policies covering
business interruption to contain loss payee endorsements in favor of
the Bank and to be subject to cancellation or reduction in coverage
only upon 30 days prior written notice thereof to the Bank at its
address set forth in this Agreement. The foregoing insurance
requirements are in addition to any insurance requirements set forth
in the 1996 Security Agreement.
7.05 Taxes. Each Borrower shall pay and discharge, and
require each of the other Guarantors to pay and discharge, when due,
all taxes, assessments or other governmental charges imposed on them
or any of their respective properties, unless the same are currently
being contested in good faith by appropriate proceedings and adequate
reserves are maintained therefor.
7.06 Conduct of Business and Maintenance of Existence. Each
Borrower shall continue to engage in business of the same general type
as now conducted, and preserve, renew and keep in full force and
effect its corporate existence and rights, privileges and franchises
necessary or desirable in the normal conduct of business and which are
material to each Borrower and each of the other Guarantors.
7.07 Operation of Business and Properties. Each Borrower
shall operate its business and properties, and cause those of the
other Guarantors to be operated, in compliance with all applicable
orders, rules, regulations and other requirements of any Governmental
Authority applicable thereto, and duly file or cause to be filed such
reports and/or information returns as may be required or appropriate
under applicable orders, rules, regulations or other requirements of
any Governmental Authority, including, without limitation, any
Environmental Laws, except to the extent that such non-compliance
would not have a Material Adverse Effect.
7.08 Access to Properties, Books and Records. Each Borrower
shall permit the Bank's representatives and/or agents full and
complete access to any or all of the Borrower's properties and
financial records, to make extracts from and/or audit such records and
to examine and discuss their properties, business, finances and
affairs with the Borrowers' officers and outside accountants, provided
that such access need only be provided by the Borrowers during normal
business hours and on not less than 72 hours' prior notice. The
Borrowers shall keep adequate records and books of account reflecting
all their respective financial transactions.
7.09 Environmental Liens. In the event that there shall be
filed a lien against any property of any Borrower by any Governmental
Authority arising from an act or omission of a Borrower, resulting in
the discharge of hazardous substances or wastes into the atmosphere or
waters or onto lands, then the affected Borrower shall, within 60 days
from the date that such Borrower is given notice that the lien has
been placed against such property or within such shorter period of
time in the event that such Governmental Authority has commenced steps
to cause such property to be sold pursuant to the lien, either (i) pay
the claim and remove the lien from the applicable property or (ii)
furnish to such Governmental Authority, in an amount sufficient to
discharge the clam out of which the lien arises, one of the following:
(x) a bond satisfactory to the Governmental Authority, (y) a cash
deposit, or (z) other security reasonably satisfactory to such
Governmental Authority.
7.10 Removal of Hazardous Substances. Should a Borrower
cause or permit any act or omission resulting in the discharge of
hazardous substances or wastes into the atmosphere or waters, or onto
the lands in violation of any applicable Environmental Law, such
Borrower shall promptly clean up same in accordance with all
applicable Environmental Laws.
7.11 Further Assurances. Each Borrower shall do, execute,
acknowledge and deliver or cause to be done, executed, acknowledged
and delivered, all such further instruments, acts, deeds, and
assurances as may be reasonably requested by the Bank for the purpose
of carrying out the provisions and intent of the Credit Documents.
VIII. NEGATIVE COVENANTS.
So long as any Obligations are outstanding, without the prior
written consent of the Bank (which consent shall not be unreasonably
withheld):
8.01 Incur Indebtedness. No Borrower shall incur, create,
assume, or permit to exist any Indebtedness at any time, except:
(a) Indebtedness of the Borrowers owing to the Bank
under this Agreement and the Notes;
(b) other Indebtedness of a Borrower owing to the Bank;
(c) Indebtedness existing on the date hereof that is
described on Annex I hereof.
(d) Approved Subordinated Indebtedness;
(e) Indebtedness in respect of normal trade debt arising
in the ordinary course of business which does not materially exceed
the levels of such debt historically incurred by a Borrower;
(f) Indebtedness secured by Liens permitted to exist
pursuant to Section 8.02(f); or
(g) Indebtedness that constitutes Guaranteed
Indebtedness of a Borrower that has been incurred by such Borrower
solely by virtue of such Borrower's endorsement of checks or drafts
negotiated in the ordinary course of the business.
8.02 Negative Pledge. No Borrower shall create, permit to
exist, or suffer the creation of, any Lien, on any of its properties
or assets (real or personal, tangible or intangible), except:
(a) Liens in favor of the Bank;
(b) Liens existing on the date hereof that are listed on
Annex I hereto;
(c) Liens for taxes, assessments or governmental charges
or levies to the extent not required to be paid by Section 7.05
hereof;
(d) Liens imposed by law, such as materialmen's,
mechanics', carrier's, workmen's, and repairmen's Liens and other
similar Liens arising in the ordinary course of business securing
obligations which are not overdue for a period of more than 30 days;
(e) pledges or deposits to secure obligations under
workmen's compensation laws or similar legislation or to secure public
or statutory obligations of a Borrower;
(f) Liens for finance leases of equipment leased by a
Borrower which do not constitute Capitalized Leases, or purchase money
Liens upon or in property acquired or held by a Borrower in the
ordinary course of business to secure the purchase price of such
property or to secure Indebtedness incurred solely for the purpose of
financing the acquisition of any such property to be subject to such
Liens, or Liens existing on any such property at the time of the
leasing, acquisition, or extensions, renewals or replacements of any
of the foregoing for the same or a lesser amount, provided that no
such Lien shall extend to or cover any property (including, but not
limited to the Financed Equipment) other than the property being
leased or acquired and no such extension, renewal or replacement shall
extend to or cover any property not theretofore subject to the Lien
being extended, renewed or replaced, and provided, further, that any
such Indebtedness shall not otherwise be prohibited by the terms of
this Agreement; or
(g) the replacement, extension or renewal of any Lien
permitted by clauses (a) through (f) above upon or in the same
property theretofore subject thereto or the replacement, extension or
renewal (without increase of principal amount) of the Indebtedness
secured thereby.
8.03 Sale of Assets; Liquidation; Merger; Acquisitions. No
Borrower shall (i) convey, lease, sell, transfer or assign any assets
or properties currently owned or hereafter acquired by it, except
dispositions of inventory in the ordinary course of business for value
received and such other dispositions of assets and properties that are
not material to the business or operations of such Borrower, if such
asset or property is replaced with reasonable promptness or is
otherwise obsolete, (ii) liquidate or discontinue its normal
operations with intent to liquidate; (iii) enter into any merger or
consolidation; (iv) acquire all or substantially all of the assets,
stock or other equity interests of any other Person; or (v) take any
action, or enter into any agreements, to effect any of the foregoing.
8.04 Prepayment of Other Indebtedness. No Borrower shall
prepay any amounts on any outstanding Indebtedness not required to be
prepaid by the express terms thereof, except to the Bank, or cause or
permit the acceleration of any amounts on any outstanding Indebtedness
now existing or hereafter arising.
8.05 Investments. No Borrower shall purchase or make any
investment in the stock, securities or evidences of indebtedness of,
or make capital contributions or loans or advances to, or other forms
of investments in, any Person, except Permitted Investments.
Notwithstanding the foregoing, the Borrowers shall be permitted to
make loans to its employees for corporate purposes; provided that the
aggregate principal amount of such loans outstanding at any one time
shall not exceed $500,000; provided, however, that in no event shall
there be outstanding under such loans an amount in excess of $250,000
on an unsecured basis and for terms longer than 1 year.
8.06 Create Subsidiaries. No Borrower shall create, permit
to exist, or invest or otherwise participate in any Subsidiaries
(other than the Subsidiaries listed on Annex 1 hereto) or any
partnership, joint venture or other material enterprise; provided that
the foregoing shall not apply to any new Subsidiaries that executes
and delivers in favor of the Bank a guaranty and security agreement
(as well as resolutions authorizing the same) substantially the same
as the guaranty and security agreement executed and delivered by the
Guarantors in connection with the transactions herein contemplated.
8.07 Hazardous Substances. No Borrower shall cause or permit
to exist a discharge of hazardous substances or wastes into the
atmosphere or waters or onto lands unless such discharge is pursuant
to and in compliance with the conditions of a permit issued by the
appropriate Governmental Authorities or otherwise in compliance with
applicable Environmental Law.
8.08 Current Ratio. Total-Tel Comm shall not permit the
ratio of its Current Assets to its Current Liabilities at any time to
be less than 1.00:1.00, measured on a consolidated basis no less
frequently than quarterly. As used herein, "Current Assets" and
"Current Liabilities" means all assets and liabilities which, in
accordance with GAAP consistently applied, should be classified as
current assets and current liabilities, respectively.
8.09 Tangible Net Worth. Total-Tel Comm shall not permit its
Tangible Net Worth at any time to be less than $12,500,000, measured
on a consolidated basis no less frequently than quarterly. As used
herein, "Tangible Net Worth" means, at any date (i) the total assets
of Total-Tel Comm which would be shown as assets on a consolidated
balance sheet of Total-Tel Comm prepared in accordance with GAAP less
(ii) the total liabilities of Total-Tel Comm as shown on a
consolidated balance sheet of Total-Tel Comm prepared in accordance
with GAAP, after subtracting therefrom the aggregate amount of any
capitalized research and development costs, capitalized interest, debt
discount and expense, goodwill, patents, trademarks, copyrights,
franchises, licenses, amounts owing from officers, directors,
shareholders, principals, partners or affiliates of any Borrower or
Guarantor and any investments in any entities owned or controlled by
any of the foregoing, and such other assets as are properly classified
as "intangible assets", in each case determined in accordance with
GAAP consistently applied.
8.10 Debt to Equity Ratio. Total-Tel Comm shall not permit
the ratio of its Total Liabilities to Tangible Capital Funds at any
time to exceed 2.00:1.00, measured on a consolidated basis no less
frequently than quarterly. As used herein, "Total Liabilities" means
the total liabilities of Total-Tel Comm as shown on a consolidated
balance sheet of Total-Tel Comm prepared in accordance with GAAP,
specifically including, without limitation, Capitalized Lease
Obligations, contingency and other reserves, deferred taxes and other
deferred sums, but specifically excluding amounts in respect of any
then outstanding Approved Subordinated Debt, in each case determined
in accordance with GAAP consistently applied. As used herein,
"Tangible Capital Funds" means the sum of (i) the Tangible Net Worth
of Total-Tel Comm as determined pursuant to the definition thereof set
forth in Section 8.10 hereof plus (ii) the principal amount of any
then outstanding Approved Subordinated Debt.
8.11 Debt Service Coverage Ratio. Total-Tel Comm shall not
permit the ratio of its EBITDA to its CPLTD plus Interest Expense to
be at any time less than 1.50:1.00, measured on a consolidated basis
no less frequently than annually. As used herein, "EBITDA" means, at
any time, the earnings (excluding any extraordinary or unusual items
and non-operating earnings adjustments) before interest expense,
taxes, depreciation and amortization, determined in accordance with
GAAP consistently applied, and "CPLTD plus Interest Expense" means, at
any time, current maturities of all Indebtedness which by its terms,
or by the terms of any instrument or agreement relating thereto,
matures, or which is otherwise payable, 1 year or more after the date
of creation thereof (whether such payment is in respect of sinking
fund requirements, mandatory prepayments, or final payment upon
maturity), including, without limitation, any Capital Lease
Obligations, plus all cash and non-cash interest (including, without
limitation, capitalized interest) accrued and/or payable during the
relevant fiscal period in or in connection with any Indebtedness, in
each case determined in accordance with GAAP, consistently applied.
8.12 Use of Proceeds. No Borrower shall use the proceeds of
any Loan made hereunder for any purpose other than the purposes
described in Section 6.03 hereof.
8.13 Change Fiscal Year. Total-Tel Comm shall not change its
fiscal year to end on any date other than January 31, or permit the
fiscal year end of any of its Subsidiaries to end on any day other
than January 31.
IX. EVENTS OF DEFAULT.
Each of the following shall constitute an event of default
("Event of Default") hereunder:
9.01 Payment Default. Any Borrower shall (i) default in the
payment, within ten (10) days after the due date, of any principal of,
or interest on, the Loans or (ii) default in the payment, within ten
(10) days after the due date, of any other amounts owing hereunder,
under the Notes or under any other Credit Document;
9.02 Negative Covenant Breach. Any Borrower shall default in
the due performance or observance by it of any term, covenant or
agreement contained in Article VIII hereof;
9.03 Other Covenant Breaches. Any Borrower shall default in
the due performance or observance of any term, covenant or agreement
(other than those referred to in Sections 9.01 and 9.02) contained in
this Agreement, the Notes or any other Credit Document, and such
default shall continue unremedied for a period of at least 30 days
after the earlier to occur of (i) the date a Borrower obtains actual
knowledge of such default or (ii) the date notice of such default is
given to a Borrower by the Bank;
9.04 Default Under Agreements for Borrowed Money. (i) Any
Borrower shall default in any payment with respect to any Indebtedness
in excess of $600,000.00 (individually or in the aggregate as to all
Borrowers) beyond the period of grace, if any, provided in the
instrument or agreement under which such Indebtedness was created or
default in the observance or performance of any agreement or condition
relating to any such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event
shall occur or condition exist, the effect of which default or other
event or condition is to cause, or to permit the holder or holders of
such Indebtedness (or a trustee or agent on behalf of such holder or
holders) to cause (determined without regard to whether any notice or
lapse of time is required), any such Indebtedness to become due prior
to its stated maturity, or (ii) any such Indebtedness shall be
declared to be due and payable, or required to be prepaid as a
mandatory prepayment, prior to the stated maturity thereof;
9.05 Default Under Other Material Contracts. Any Borrower
shall default in the due performance or observance of any material
term, covenant or agreement contained in any contract, agreement,
understanding or arrangement, beyond the period of grace, if any,
provided in the relevant contract, involving an aggregate
consideration payable by or to such Borrower of $100,000.00 or more in
any 1 year or is otherwise material to the business, condition,
operations, performance, properties or prospects of such Borrower;
9.06 Voluntary Bankruptcy. Any Borrower commences any
bankruptcy, reorganization, debt arrangement, or other case or
proceeding under the United States Bankruptcy Code or under any
similar foreign, federal, state, or local statute, or any dissolution
or liquidation proceeding, or makes a general assignment for the
benefit of creditors, or takes any action for the purpose of effecting
any of the foregoing;
9.07 Involuntary Bankruptcy. Any bankruptcy, reorganization,
debt arrangement, or other case or proceeding under the United States
Bankruptcy Code or under similar foreign, federal, state or local
statute, or any dissolution or liquidation proceeding, is
involuntarily commenced against or in respect of any Borrower and not
stayed or discharged within 30 days of the commencement thereof;
9.08 Appointment of Receiver. The appointment, or the filing
of a petition seeking the appointment of a custodian, receiver,
trustee, or liquidator for any Borrower or any of their respective
property, or the taking of possession of any part of the property of
any Borrower at the instance of any Governmental Authority;
9.09 Insolvency. Any Borrower becomes insolvent (however
defined), is generally not paying its debts as they become due, or has
suspended transaction of its usual business;
9.10 Reorganization. The dissolution, merger, consolidation,
or reorganization of any Borrower, other than the merger of any
Borrower (other than Total-Tel Comm) into another Borrower;
9.11 Material Misstatement. Any statement, representation or
warranty made in or pursuant to this Agreement or any other Credit
Document or to induce the Bank to enter into this Agreement or to
enter into the transactions referred to in this Agreement shall prove
to be untrue or misleading in any material respect;
9.12 Material Adverse Change. The occurrence of a material
adverse change in the financial condition of any Borrower or the
occurrence of any event which, in the reasonable opinion of the Bank,
materially impairs the financial responsibility of any Borrower; or
9.13 Entry of Judgment. The entry or issuance of judgments,
orders, decrees or fines against any Borrower which, in the aggregate,
involve liabilities in excess of the sum of $100,000.00 (the discharge
of which is not the obligation of any insurance company) and any such
judgments or orders involving liabilities in excess of said sum shall
have continued unbonded or unsatisfied and without stay of execution
or agreement between the parties thereon for a period of 30 days after
the entry or issuance of such judgment.
X. REMEDIES.
10.01 Acceleration of Obligations; Other Remedies. Upon and
following the occurrence of an Event of Default described in Article
IX hereof (other than the Events of Default described in Sections
9.06, 9.07, and 9.08 hereof), at the Bank's sole option, the Bank's
commitment, if any, to make any further advance or Loans hereunder
shall terminate and all Obligations shall immediately become due and
payable in full, all without protest, presentment, demand or further
notice of any kind to the Borrowers, all of which are expressly
waived. Upon the occurrence of the Event of Default described in
Sections 9.06, 9.07, and 9.08 hereof, immediately and automatically,
the Bank's commitment, if any, to make any further advances or Loans
hereunder shall terminate and all Obligations shall immediately become
due and payable in full, all without protest, presentment, demand or
further notice of any kind to the Borrowers, all of which are
expressly waived. Upon and following an Event of Default, the Bank
may, at its option, exercise any and all rights and remedies it has
under this Agreement, any other Credit Document and/or applicable law,
including, without limitation, the right to charge and collect
interest on the principal portion of the Obligations at a rate equal
to the lesser of: (i) the highest rate of interest set forth in the
Credit Documents, or (ii) the highest rate of interest allowed by law,
such rate of interest to apply to the Obligations, at the Bank's
option, upon and after an Event of Default, maturity, whether by
acceleration or otherwise, and the entry of a judgment in favor of the
Bank with respect to any or all of the Obligations. Upon and
following an Event of Default, the Bank may proceed to protect and
enforce the Bank's rights under any Credit Document and/or under
applicable law by action at law, in equity or other appropriate
proceeding including, without limitation, an action for specific
performance to enforce or aid in the enforcement of any provision
contained herein or in any other Credit Document.
10.02 Right of Set-off. If any of the Obligations shall be
due and payable or any one or more Events of Default shall have
occurred, whether or not the Bank shall have made demand under any
Credit Document and regardless of the adequacy of any collateral for
the Obligations or other means of obtaining repayment of the
Obligations, the Bank shall have the right, without notice to any
Borrower, and is specifically authorized hereby to set-off against and
apply to the then unpaid balance of the Obligations any items or funds
of any Borrower held by the Bank, any and all deposits (whether
general or special, time or demand, matured or unmatured) or any other
property of any Borrower, including, without limitation, securities
and/or certificates of deposit, now or hereafter maintained by any
Borrower for its or their own account with the Bank, and any other
indebtedness at any time held or owing by the Bank to or for the
credit or the account of any Borrower, even if effecting such set-off
results in a loss or reduction of interest or the imposition of a
penalty applicable to the early withdrawal of time deposits. For such
purpose, the Bank shall have, and each Borrower hereby grants to the
Bank, a lien on and security interest in such deposits, property,
funds and accounts and the proceeds thereof.
10.03 Remedies Cumulative; No Waiver or Impairment. The
rights, powers and remedies of the Bank provided in this Agreement and
any of the Credit Documents are cumulative and not exclusive of any
right, power or remedy provided by law or equity. No failure or delay
on the part of the Bank in the exercise of any right, power or remedy
shall operate as a waiver thereof, nor shall any single or partial
exercise preclude any other or further exercise thereof, or the
exercise of any other right, power or remedy. The liabilities of the
Borrowers hereunder and under the other Credit Documents shall be
joint and several and the Bank may, in its sole and absolute
discretion, enforce any such liability against any Borrower or all
Borrowers without affecting or impairing the further enforcement of
the liabilities hereunder or under the other Credit Documents against
any other Borrower or all Borrowers, as the case may be.
XI. MISCELLANEOUS.
11.01 Notices. Notices and communications under this
Agreement and the other Credit Documents shall be in writing and shall
be given by either (i) hand-delivery, (ii) certified mail (return
receipt requested, postage prepaid), (iii) reliable overnight
commercial courier (charges prepaid), or (iv) telecopy, to the
addresses and telecopy numbers listed in this Agreement. Notice given
by telecopy shall be deemed to have been given and received when sent.
Notice by overnight courier shall be deemed to have been given and
received on the date scheduled for delivery. Notice by certified mail
shall be deemed to have been given and received on the dates indicated
on the receipt returned to the sender thereof. A party may change its
address and/or telecopier number by giving written notice to the other
party as specified herein. For the avoidance of doubt, any notice
required to be given by the Bank to the Borrowers or any Borrower
shall be deemed given by the Bank for all purposes when given to
Total-Tel Comm in accordance with this Section 11.01. Furthermore,
with respect to any notice required to be given by the Borrowers or
any particular Borrower, the Bank may rely (and shall be fully
protected in relying) on any notice received from any authorized
officer of any Borrower which the Bank believed in good faith to be
genuine and correct and to be acting on behalf of all Borrowers.
11.02 Costs and Expenses. Whether or not the transactions
contemplated by the Credit Documents are fully consummated, the
Borrowers shall promptly pay (or reimburse, as the Bank may elect) all
reasonable costs and expenses which the Bank has incurred or may
hereafter incur in connection with the negotiation, preparation,
reproduction, interpretation, perfection, monitoring, administration
and enforcement of the Credit Documents, the collection of all amounts
due under the Credit Documents, and all amendments, modifications,
consents or waivers, if any, to the Credit Documents. Such costs and
expenses shall include, without limitation, the reasonable fees and
disbursements of counsel to the Bank (including the Bank's in-house
counsel), the costs of appraisals, costs of environmental studies,
searches of public records, costs of filing and recording documents
with public offices, internal and/or external audit and/or examination
fees and costs, stamp, excise and other taxes and costs and expenses
incurred by the Bank, and the fees of the Bank's accountants,
consultants or other professionals. The Borrowers' reimbursement
obligations under this paragraph shall survive any termination of the
Credit Documents.
11.03 Payment Due on a Day Other Than a Business Day. If any
payment due or action to be taken under this Agreement or any Credit
Document falls due or is required to be taken on a day that is not a
Business Day, such payment or action shall be made or taken on the
next succeeding Business Day and such extended time shall be included
in the computation of interest.
11.04 Governing Law. This Agreement shall be construed in
accordance with and governed by the substantive laws of the State of
New Jersey without reference to conflict of laws principles.
11.05 Superseding Effect. This Agreement and the other Credit
Documents constitute the sole agreement of the parties with respect to
the subject matter hereof and thereof and supersede all oral
negotiations and prior writings with respect to the subject matter
hereof and thereof.
11.06 Amendment; Waiver. No amendment of this Agreement, and
no waiver of any one or more of the provisions hereof shall be
effective unless set forth in writing and signed by the parties
hereto.
11.07 Successors and Assigns. This Agreement (i) shall be
binding upon the Borrowers and the Bank and their respective
successors and permitted assigns, and (ii) shall inure to the benefit
of the Borrowers and the Bank and their respective successors and
permitted assigns; provided, however, that no Borrower may assign its
rights hereunder or any interest herein without the prior written
consent of the Bank, and any such assignment or attempted assignment
by a Borrower shall be void and of no effect with respect to the Bank.
11.08 Sale, Assignment or Participations. The Bank may from
time to time sell or assign, in whole or in part, or grant
participations in some or all of the Credit Documents and/or the
obligations evidenced thereby. The holder of any such sale,
assignment or participation, if the applicable agreement between the
Bank and such holder so provides, (i) shall be entitled to all of the
rights, obligations and benefits of the Bank and (ii) shall be deemed
to hold and may exercise the rights of set-off or banker's lien with
respect to any and all obligations of such holder to any Borrower, in
each case as fully as though such Borrower were directly indebted to
such holder. The Bank may, in its discretion, give notice to any
Borrower of such sale, assignment or participation; however, the
failure to give such notice shall not affect any of the Bank's or such
holder's rights hereunder. Each Borrower authorizes the Bank to
provide information concerning the Borrowers to any prospective
purchaser, assignee or participant. The information provided may
include, but is not limited to, amounts, terms, balances, payment
history, return item history and any financial or other information
about the Borrowers. The Borrowers, jointly and severally, agree to
indemnify, defend, release the Bank, and hold the Bank harmless, at
the Borrowers' cost and expense, from and against any and all
lawsuits, claims, actions, proceedings, or suits against the Bank or
against any Borrower and the Bank, arising out of or relating to the
Bank's reporting or disclosure of such information, unless any such
claims are the result of the Bank's gross negligence or willful
misconduct.
11.09 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Agreement or any
instrument or agreement required hereunder. In lieu of any illegal or
unenforceable provision in this Agreement, there shall be added
automatically as a part of this Agreement a legal and enforceable
provision as similar in terms to such illegal or unenforceable
provision as may be possible.
11.10 Consent to Jurisdiction and Service of Process. Each
Borrower irrevocably appoints each and every corporate officer of such
Borrower as their attorneys upon whom may be served, by regular or
certified mail at the address set forth in this Agreement, any notice,
process or pleading in any action or proceeding against it arising out
of or in connection with this Agreement or any of the other Credit
Documents. Each Borrower hereby consents that any action or
proceeding against it may be commenced and maintained in any court
within the State of New Jersey or in the United States District Court
for the District of New Jersey by service of process on any such
officer. Each Borrower further agrees that such courts of the State
of New Jersey and the United States District Court for the District of
New Jersey shall have jurisdiction with respect to the subject matter
hereof and the person of such Borrower and all collateral for the
Obligations. Notwithstanding the foregoing, each Borrower agrees that
any action brought by such Borrower shall be commenced and maintained
only in a court in the federal judicial district or county in which
the Bank has its principal place of business in New Jersey.
11.11 Indemnification.
(a) If, after receipt of any payment of all or any part of
the Obligations, the Bank is compelled or agrees, for settlement
purposes, to surrender such payment to any person or entity for any
reason (including, without limitation, a determination that such
payment is void or voidable as a preference or fraudulent conveyance,
an impermissible set-off, or a diversion of trust funds), then this
Agreement and the other Credit Documents shall continue in full force
and effect, and each Borrower shall be liable for, and shall
indemnify, defend and hold harmless the Bank with respect to the full
amount so surrendered.
(b) The Borrowers, jointly and severally, shall indemnify,
defend and hold harmless the Bank with respect to any and all claims,
expenses, demands, losses, costs, fines or liabilities of any kind
(including, without limitation, those involving death, personal injury
or property damage and including reasonable attorneys fees and costs)
arising from or in any way related to any hazardous materials or a
dangerous environmental condition within, on, from, related to or
affecting any real property owned or occupied by the Borrower
including, without limitation, any and all claims that may arise as a
result of an intentional or unintentional act or omission of any
Borrower, any previous owner and/or operator of real property owned or
occupied by any Borrower that resulted in the discharge of hazardous
substances or wastes into the atmosphere or waters or onto the lands.
(c) The provisions of this paragraph shall survive the
termination of this Agreement and the other Credit Documents and shall
be and remain effective notwithstanding the payment of the
Obligations, the release of any security interest, lien or encumbrance
securing the Obligations or any other action which the Bank may have
taken in reliance upon its receipt of such payment. Any action by the
Bank shall be deemed to have been conditioned upon any payment of the
Obligations having become final and irrevocable.
11.12 Inconsistencies. The Credit Documents are intended to
be consistent. However, in the event of any inconsistencies among any
of the Credit Documents, such inconsistency shall not affect the
validity or enforceability of each Credit Document. Each Borrower
agrees that in the event of any inconsistency or ambiguity in any of
the Credit Documents, the Credit Documents shall not be construed
against any one party but shall be interpreted consistent with the
Bank's policies and procedures.
11.13 Headings. The headings of articles, sections and
paragraphs have been included herein for convenience only and shall
not be considered in interpreting this Agreement.
11.14 Schedules. All Schedules, Annexes and/or an Exhibits
attached hereto are incorporated herein.
11.15 Judicial Proceeding; Waivers.
(a) EACH PARTY TO THIS AGREEMENT AGREES THAT ANY SUIT,
ACTION OR PROCEEDING, WHETHER CLAIM OR COUNTER-CLAIM, BROUGHT OR
INSTITUTED BY ANY PARTY HERETO OR ANY SUCCESSOR OR ASSIGN OF ANY
PARTY, ON OR WITH RESPECT TO THIS AGREEMENT OR ANY OF THE OTHER CREDIT
DOCUMENTS OR THE DEALINGS OF THE PARTIES WITH RESPECT HERETO, OR
THERETO, SHALL BE TRIED ONLY BY A COURT AND NOT BY A JURY.
(b) EACH PARTY HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT,
ACTION OR PROCEEDING. FURTHER, EACH PARTY WAIVES ANY RIGHT IT MAY
HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY
SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES
OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
(c) EACH BORROWER ACKNOWLEDGES AND AGREES THAT THIS
SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS AGREEMENT AND THAT
THE BANK WOULD NOT EXTEND CREDIT TO ANY BORROWER IF THE WAIVERS SET
FORTH IN THIS SECTION WERE NOT A PART OF THIS AGREEMENT.
IN WITNESS WHEREOF, the parties by their duly authorized
representatives have executed this Agreement as of the day and year
first above written.
WITNESS/ATTEST: TOTAL-TEL USA COMMUNICATIONS, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL USA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL CARRIER SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL INTERNATIONAL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SOUTHEAST, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL FLORIDA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL U.K., LTD.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
SUMMIT BANK
By:_____________________________
Name:
Title:
Address:________________________
________________________
Telecopier:_____________________
EXHIBIT A
EQUIPMENT FACILITY/TERM NOTE
$5,000,000.00 _____________ __, 1997
, New Jersey
FOR VALUE RECEIVED, and intending to be legally bound hereby, the
undersigned, jointly, severally and unconditionally promise to pay to
the order of SUMMIT BANK (the "Bank"), the principal amount of all
Equipment Loans (as defined in the Credit Agreement referred to below)
that are now or may hereafter be made under and pursuant to the
Equipment Facility established under said Credit Agreement and that
are then outstanding, together with all accrued and unpaid interest
thereon and any unpaid costs and expenses payable thereunder and
hereunder, on February 28, 1999 (the "Expiration Date"), unless such
obligations are converted to a term loan obligation pursuant to said
Credit Agreement, in which case such obligations shall mature and be
due and payable on the fifth anniversary of the date of said
conversion (the "Maturity Date").
A. Terms of Note.
1. Payment of Principal. The principal balance of each
Equipment Loan evidenced by this note (together with any attachments
hereto and any amendments or modifications hereof in effect from time
to time, this "Note") due and payable in full on the Expiration Date,
unless the obligations evidenced hereby are converted to a term loan
obligation pursuant to Section 1.04 of the Credit Agreement, in which
case the principal balance hereunder shall be payable in consecutive
monthly installments in the amounts and on the dates prescribed in
Section 1.06 of the Credit Agreement, with a final installment in the
amount of the remaining outstanding principal hereunder, together with
any accrued and unpaid interest thereon, due and payable on the
Maturity Date.
2. Interest Payments. The undersigned agree to pay to the
Bank, interest, in arrears, on the outstanding principal balance
hereunder at the rates and on the dates set forth in the Credit
Agreement, until the entire principal balance hereunder, together with
accrued and unpaid interest thereon, is paid in full.
3. Computation of Interest. Interest hereunder shall be
computed daily on the basis of a year of 360 days for the actual
number of days elapsed. If the due date for any payment of principal
is extended by operation of law, interest shall be payable for such
extended time.
4. Payment Terms. All payments made hereunder shall be made
on or before 10:00 a.m. on the due date thereof, in immediately
available funds and in lawful currency of the United States of America
and free and clear of, and without deduction or withholding for, any
taxes or other payments. Payments shall be deemed made when delivered
to the Bank at its offices set forth in this Note or at such other
office of the Bank as the Bank shall notify the undersigned of in
writing.
5. Incorporation by Reference. This Note is the Equipment
Facility/Term Note referred to in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement, dated as of
__________ , 1998, by and between the Bank and the undersigned
(together with any amendments and modifications thereto in effect from
time to time, the "Credit Agreement") and is subject to the terms and
conditions thereof, which terms and conditions are incorporated
herein, including, without limitation, the terms pertaining to
payment, definitions, representations, warranties, covenants, events
of default and remedies. Any capitalized term used herein without
definition shall have the meaning set forth in the Credit Agreement.
6. Bank Records of Advance. The Bank may enter in its
business records the date and the amount of each advance and payment
of Equipment Loans made pursuant to the Credit Agreement and the date
and terms of the conversion of such loans to a term loan pursuant to
the Credit Agreement. The Bank's records thereof shall, in the absence
of manifest error, be conclusively binding upon the undersigned. In
the event the Bank gives notice or renders a statement by mailing such
notice or statement to the undersigned, concerning any such advance,
conversion or payment, or the amount of principal and interest due on
this Note, the undersigned agree that, unless the Bank receives a
written notification of exceptions to such a statement within 10
calendar days after such statement or notice is mailed, the statement
or notice shall be an account stated, correct and acceptable and
binding upon the undersigned.
7. Late Charge. In the event that any payment hereunder
shall not be received by the Bank within ten (10) days of the due date
thereof, the undersigned shall, to the extent permitted by law, pay
the Bank a late charge of five percent (5%) of the overdue payment
(but in no event to be less than $25.00 nor more than $2,500.00). Any
such late charge assessed is immediately due and payable.
8. Default Rate. At the Bank's option, interest will be
assessed on any principal which remains unpaid at the maturity of this
Note, whether by acceleration or otherwise, or upon and following an
Event of Default, at a rate which is 400 basis points (4%) higher than
the rate otherwise charged with respect thereto (the "Default Rate")
provided that at no time shall the amounts owed by the undersigned to
the Bank pursuant to any judgments entered in favor of Bank with
respect to this Note, or any other Credit Document.
B. Remedies.
1. Generally. Upon and following an Event of Default, the
Bank, at its option, may exercise any and all rights and remedies it
has under this Note, the other Credit Documents and under applicable
law, including, without limitation, the right to charge and collect
interest on the principal portion of the amounts outstanding hereunder
at the Default Rate. Upon and following an Event of Default
hereunder, the Bank may proceed to protect and enforce the Bank's
rights hereunder and/or applicable law by action at law, in equity, or
other appropriate proceeding, including, without limitation, an action
for specific performance to enforce or aid in the enforcement of any
provision contained herein or in any other Credit Document.
2. Remedies Cumulative; No Waiver. The remedies hereunder
and under the other Credit Documents are cumulative and concurrent,
and are not exclusive of any other remedies available to the Bank. No
failure or delay on the part of the Bank in the exercise of any right,
power, remedy or privilege shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power, remedy or
privilege preclude any other or further exercise thereof, or the
exercise of any other right, power, remedy or privilege.
C. Miscellaneous.
1. Governing Law. This Note shall be construed in accordance
with and governed by the substantive laws of the State of New Jersey
without reference to conflict of laws principles.
2. Amendment; Waiver. No amendment of this Note, and no
waiver of any one or more of the provisions hereof shall be effective
unless set forth in writing and signed by the Borrower and the Bank.
3. Successors and Assigns. This Note (i) shall be binding
upon the undersigned and the Bank, their respective successors and
permitted assigns, and (ii) shall inure to the benefit of the
undersigned and the Bank and, their respective successors and
permitted assigns; provided, however, that none of the undersigned may
assign its rights or obligations hereunder or any interest herein
without the prior written consent of the Bank, which shall not be
unreasonably withheld, and any such assignment or attempted assignment
by any of the undersigned shall be void and of no effect with respect
to the Bank.
4. Severability. The illegality or unenforceability of any
provision of this Note or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Note or any
instrument or agreement required hereunder. In lieu of any illegal or
unenforceable provision in this Note, there shall be added
automatically as part of this Note a legal and enforceable provision
as similar in terms to such illegal or unenforceable provision as may
be possible.
6. Judicial Proceeding; Waiver.
(a) THE UNDERSIGNED AGREE THAT ANY SUIT, ACTION OR
PROCEEDING, WHETHER CLAIM OR COUNTERCLAIM, BROUGHT OR INSTITUTED BY
THE BANK OR THE UNDERSIGNED OR ANY SUCCESSOR OR ASSIGN OF THE BANK OR
THE UNDERSIGNED, ON OR WITH RESPECT TO THIS NOTE OR ANY OTHER CREDIT
DOCUMENT OR THE DEALINGS OF THE PARTIES WITH RESPECT HERETO, OR
THERETO, SHALL BE TRIED ONLY BY A COURT AND NOT BY A JURY.
(b) THE BANK AND THE UNDERSIGNED EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN
ANY SUCH SUIT, ACTION OR PROCEEDING. FURTHER, THE UNDERSIGNED WAIVE
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES
OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
(c) THE UNDERSIGNED ACKNOWLEDGE AND AGREE THAT THIS
SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS NOTE AND THAT THE
BANK WOULD NOT EXTEND CREDIT TO THE UNDERSIGNED IF THE WAIVERS SET
FORTH IN THIS SECTION WERE NOT A PART OF THIS NOTE.
IN WITNESS WHEREOF, the undersigned have duly executed and
delivered to the Bank this Note as of the day and year first above
written.
WITNESS/ATTEST: TOTAL-TEL USA COMMUNICATIONS, INC.
By:_________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL, INC.
By:__________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL USA, INC.
By:__________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL CARRIER SERVICES, INC.
By:__________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL INTERNATIONAL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SOUTHEAST, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL FLORIDA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL U.K., LTD.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
EXHIBIT B
Notice of Borrowing Under
Equipment Facility
Borrower: ____________________________________
Date of Borrowing: ___________________________
Amount Requested: $___________________________
Interest Rate Basis: Prime/LIBOR
Interest Period: 1/2/3 month(s)
The Borrower hereby notifies the Bank that it requests a borrowing
("Borrowing") in the form of an Equipment Loan under the Amended and
Restated Equipment Facility and Revolving Credit Agreement dated as of
________ __, 1998 (together with any amendments or modifications
thereto in effect from time to time, the "Credit Agreement")
established for the Borrowers thereunder in the amount set forth
above. The Borrowing will be deposited in the Borrower's Account No.
________________________. In order to induce the Bank to fund such
Borrowing, the Borrower hereby affirms the following:
1. The representations and warranties contained in the Credit
Agreement are correct on and as of the date of this Notice of
Borrowing.
2. No Event of Default (as defined in the Credit Agreement),
and no event which, with the giving of notice, passage of time, or
both, would become an Event of Default, has occurred and is
continuing.
3. There has been no adverse change in the condition,
financial or otherwise, of any of the Borrowers since the date of the
Credit Agreement.
4. All of the Credit Documents (as defined in the Credit
Agreement) remain in full force and effect.
5. Attached hereto is a true and correct copy of
[invoice/xxxx of sale] rendered by the vendor in connection with the
acquisition of the equipment to be financed with the proceeds of the
Borrowing. Said [invoice/xxxx of sale] accurately states the total
consideration to be paid for such equipment, which is $
. Also attached is a true and complete description of said equipment
and the location or proposed location thereof.
Date: , 19
[RELEVANT BORROWER]
By:_________________________________
Name:
Title:
EXHIBIT D
AMENDED AND RESTATED REVOLVING CREDIT NOTE
$8,000,000.00 __________ ___, 1997
, New Jersey
FOR VALUE RECEIVED, and intending to be legally bound hereby, the
undersigned, jointly, severally and unconditionally promise to pay to
the order of SUMMIT BANK (the "Bank"), the principal amount of all
advances that are now or may hereafter be made under and pursuant to
the Revolving Credit Facility established under the Credit Agreement
(as defined below) and that are then outstanding, together with
accrued, unpaid interest thereon and any unpaid costs and expenses
payable hereunder, on May 31, 1998.
A. Terms of Note.
1. Interest Payments. The principal amount of each Revolving
Credit Loan (as defined in the Credit Agreement) evidenced by this
note (together with any attachments hereto and any amendments and
modifications hereto in effect from time to time, this "Note") shall
bear interest at the rates set forth in the Credit Agreement and
accrued interest shall be due and payable by the undersigned in
accordance with the provisions thereof.
2. Computation of Interest. Interest hereunder shall be
computed daily on the basis of a year of 360 days for the actual
number of days elapsed. If the due date for any payment of principal
is extended by operation of law, interests shall be payable for such
extended time.
3. Payment Terms. All payments made hereunder shall be made
on or before 10:00 a.m. on the due date thereof, in immediately
available funds and in lawful currency of the United States of America
and free and clear of, and without deduction or withholding for, any
taxes or other payments. Payments shall be deemed made when delivered
to the Bank at its offices set forth in this Note or at such other
office of the Bank as the Bank shall notify the undersigned of in
writing.
4. Incorporation by Reference. This Note is the Revolving
Credit Note referred to in that certain Amended and Restated Equipment
Facility and Revolving Credit Agreement, dated as of _______ , 1998,
between the Bank and the undersigned (together with any amendments and
modifications thereto in effect from time to time, the "Credit
Agreement") and is subject to the terms and conditions thereof, which
terms and conditions are incorporated herein, including, without
limitation, terms pertaining to definitions, representations,
warranties, covenants, events of default and remedies. Any
capitalized term used herein without definition shall have the
definition contained in the Credit Agreement.
5. Bank Records of Advance. The Bank may enter in its
business records the date and the amount of each advance of a
Revolving Credit Loan, each conversion from one interest rate basis to
another and each payment made pursuant to this Note and the Credit
Agreement. The Bank's records of such advance, conversion or payment
shall, in the absence of manifest error, be conclusively binding upon
the undersigned. In the event the Bank gives notice or renders a
statement by mailing such notice or statement to the undersigned,
concerning any such advance, conversion or payment, or the amount of
principal and interest due on this Note, the undersigned agree that,
unless the Bank receives a written notification of exceptions to such
a statement within 10 calendar days after such statement or notice is
mailed, the statement or notice shall be an account stated, correct
and acceptable and binding upon the undersigned.
6. Late Charge. In the event that any payment hereunder
shall not be received by the Bank within ten (10) days of the due date
thereof, the undersigned shall, to the extent permitted by law, pay
the Bank a late charge of five percent (5%) of the overdue payment
(but in no event to be less that $25.00 nor more than $2,500.00). Any
such late charge assessed is immediately due and payable.
7. Default Rate. At the Bank's option, interest will be
assessed on any principal which remains unpaid at the maturity of this
Note, whether by acceleration or otherwise, or upon and following any
Event of Default, at a rate which is 400 basis points (4%) higher than
the rate otherwise charged with respect thereto (the "Default Rate"),
provided that at no time shall the Default Rate exceed the highest
rate of interest allowed by law. Such Default Rate of interest shall
also be charged on the amounts owed by the undersigned to the Bank
pursuant to any judgments entered in favor of Bank in respect of this
Note or any other Credit Document.
B. Remedies.
1. Generally. Upon and following an Event of Default, the
Bank, at its option, may exercise any and all rights and remedies it
has under this Note, the other Credit Documents and under applicable
law, including, without limitation, the right to charge and collect
interest on the principal portion of the amounts outstanding hereunder
at the Default Rate. Upon and following an Event of Default, the Bank
may proceed to protect and enforce the Bank's rights under any Credit
Document and/or under applicable law by action at law, in equity, or
other appropriate proceeding, including, without limitation, an action
for specific performance to enforce or aid in the enforcement of any
provision contained herein or in any other Credit Document.
2. Remedies Cumulative; No Waiver. The remedies hereunder
and under the other Credit Documents are cumulative and concurrent,
and are not exclusive of any other remedies available to the Bank. No
failure or delay on the part of the Bank in the exercise of any right,
power, remedy or privilege shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, power, remedy or
privilege preclude any other or further exercise thereof, or the
exercise of any other right, power, remedy or privilege.
C. Miscellaneous.
1. Governing Law. This Note shall be construed in accordance
with and governed by the substantive laws of the State of New Jersey
without reference to conflict of laws principles.
2. Amendment; Waiver. No amendment of this Note, and no
waiver of any one or more of the provisions hereof shall be effective
unless set forth in writing and signed by the Bank and the
undersigned.
3. Superseding Effect. This Restated Revolving Credit
Note supersedes the note issued under the 1996 Revolving Credit
Facility in the original principal amount of $4,000,000.00. This
Restated Revolving Credit Note is issued in substitution and
replacement of such 1996 note and not in payment thereof, any and all
amounts due pursuant to such 1996 note including, without limitation,
all accrued and unpaid interest, shall be evidenced hereby and paid in
accordance with the terms hereof.
4. Successors and Assigns. This Note (i) shall be binding
upon the undersigned and the Bank, their respective successors and
permitted assigns, and (ii) shall inure to the benefit of the
undersigned and the Bank and their respective successors and permitted
assigns; provided, however, that none of the undersigned may assign
its rights or obligations hereunder or any interest herein without the
prior written consent of the Bank, which shall not be unreasonably
withheld, and any such assignment or attempted assignment by any of
the undersigned shall be void and of no effect with respect to the
Bank.
5. Severability. The illegality or unenforceability of any
provision of this Note or any instrument or agreement required
hereunder shall not in any way affect or impair the legality or
enforceability of the remaining provisions of this Note or any
instrument or agreement required hereunder. In lieu of any illegal or
unenforceable provision in this Note, there shall be added
automatically as part of this Note a legal and enforceable provision
as similar in terms to such illegal or unenforceable provision as may
be possible.
6. Judicial Proceeding; Waivers.
(a) THE UNDERSIGNED AGREE THAT ANY SUIT, ACTION OR
PROCEEDING, WHETHER CLAIM OR COUNTERCLAIM, BROUGHT OR INSTITUTED BY
THE BANK OR THE UNDERSIGNED OR ANY SUCCESSOR OR ASSIGN OF THE BANK OR
THE UNDERSIGNED, ON OR WITH RESPECT TO THIS NOTE OR ANY OTHER CREDIT
DOCUMENT OR THE DEALINGS OF THE PARTIES WITH RESPECT HERETO, OR
THERETO, SHALL BE TRIED ONLY BY A COURT AND NOT BY A JURY.
(b) THE BANK AND THE UNDERSIGNED EACH HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN
ANY SUCH SUIT, ACTION OR PROCEEDING. FURTHER, THE UNDERSIGNED WAIVE
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES
OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
(c) THE UNDERSIGNED ACKNOWLEDGE AND AGREE THAT THIS
SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS NOTE AND THAT THE
BANK WOULD NOT EXTEND CREDIT TO THE UNDERSIGNED IF THE WAIVERS SET
FORTH IN THIS SECTION WERE NOT A PART OF THIS NOTE.
IN WITNESS WHEREOF, the undersigned have duly executed and
delivered to the Bank this Note as of the date first above written.
WITNESS/ATTEST: TOTAL-TEL USA COMMUNICATIONS, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL USA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL CARRIER SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL INTERNATIONAL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SOUTHEAST, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL FLORIDA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL U.K., LTD.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
EXHIBIT E
Notice of Borrowing Under
Revolving Credit
Borrower: ____________________________________
Date of Borrowing: ___________________________
Amount Requested: $___________________________
Interest Rate Basis: Prime/LIBOR
Interest Period: 1/2/3 Month[s]
The Borrower hereby notifies the Bank that it requires a borrowing
("Borrowing") in the form of a Revolving Credit Loan under the
Equipment Facility and Revolving Credit Agreement dated as of August
, 1996 (together with any amendments or modifications thereto in
effect from time to time, the "Credit Agreement") established for the
Borrowers thereunder in the amount set forth above. The Borrowing
will be deposited in the Borrower's Account No.
________________________. In order to induce the Bank to fund such
Borrowing, the Borrower hereby affirms the following:
1. The representations and warranties contained in the Credit
Agreement are correct on and as of the date of this Notice of
Borrowing.
2. No Event of Default (as defined in the Credit Agreement),
and no event which, with the giving of notice, passage of time, or
both, would become an Event of Default, has occurred and is
continuing.
3. There has been no adverse change in the condition,
financial or otherwise, of any of the Borrowers since the date of the
Credit Agreement.
4. All of the Credit Documents (as defined in the Credit
Agreement) remain in full force and effect.
5. Use of Borrowing will be:
Date: , 19
[RELEVANT BORROWER]
By:_____________________________
Name:
Title:
EXHIBIT F
CLOSING CHECKLIST
SUMMIT BANK ( the "Bank")
AMENDED AND RESTATED EQUIPMENT FACILITY
AND REVOLVING CREDIT AGREEMENT
with
TOTAL-TEL USA COMMUNICATIONS, INC.
TOTAL-TEL, INC.,
TOTAL-TEL USA, INC.
TOTAL-TEL CARRIER SERVICES, INC.
TOTAL-TEL INTERNATIONAL, INC.
TOTAL-TEL SOUTHEAST, INC.
TOTAL-TEL SERVICES, INC.
TOTAL-TEL FLORIDA, INC.
and
TOTAL TEL U.K., LTD.
as "Borrowers"
__________ __, 1998
1. Amended and Restated Equipment Facility and Revolving Credit
Agreement
2. Equipment Facility/Term Note
3. Amended and Restated Revolving Credit Note
4. 1996 Term Note
5. Guaranty and Suretyship Agreement of Borrowers
6. Amended and Restated Security Agreement
7. Certificate of Authority and Incumbency from Secretary of each
Borrower, which shall have attached as and exhibit an Authorizing
Resolution of the Board of Directors
8. Certificates of Good Standing for each Borrower in New Jersey
9. Certificates of Qualification to do business as a foreign
corporation in New York and Florida, as appropriate
10. UCC, Tax Lien and Judgment Searches against each Borrower in
all appropriate jurisdictions
11. Opinion of Counsel to Borrowers
12. Evidence of Requisite Insurance
13. Current financial statements [if any]
14. Reliance letter from Borrowers' certified public accountant
regarding audited annual statements
EXHIBIT G
COMPLIANCE CERTIFICATE OF TOTAL-TEL USA COMMUNICATIONS, INC.
FOR THE FISCAL YEAR ENDING _______________________ 19___ OR
FOR THE FISCAL QUARTER ENDING _____________________ 19___
This Compliance Certificate, signed by the chief financial officer of
TOTAL-TEL USA COMMUNICATIONS, INC. (the "Company"), is delivered to
the Bank pursuant to Section 7.02 of the Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Credit
Agreement") dated as of ___________ , 1998.
The undersigned certificates that he/she is authorized to execute this
Compliance Certificate on behalf of the Company and hereby certifies
on behalf of the Company that to the best of his/her knowledge:
(1) all representations and warranties set forth in the
Credit Agreement and in any other Credit Document (as defined in the
Credit Agreement) remain true and correct;
(2) none of the covenants in the Credit Agreement or in any
of the other Credit Documents has been breached;
(3) no event has occurred which, alone, or with the giving of
notice or the passage of time, or both, would constitute an Event of
Default under the Credit Agreement or under any of the other Credit
Documents. No material adverse change has occurred in the financial
condition of any of the Borrowers; and
(4) attached hereto is the computation of the financial
covenants set forth in Sections 8.10, 8.11, 8.12 and 8.13 of the
Credit Agreement, together with the calculation of each significant
component necessary to determine compliance with such covenants.
The foregoing representations concerning the Company's financial
condition are made to the Bank with the understanding that the Bank
will rely on these representations in making credit decisions with
respect to the Credit Agreement.
TOTAL-TEL USA COMMUNICATIONS, INC.
By:_____________________________
Name:
Title:
ANNEX I
SUBSIDIARIES OF
TOTAL-TEL USA COMMUNICATIONS, INC.
Total-Tel, Inc.
Total-Tel USA, Inc.
Total-Tel Southeast, Inc.
Total-Tel Carrier Services, Inc.
Total-Tel Services, Inc.
Total-Tel Sarasota, Inc.
Total-Tel International, Inc.
Total-Tel Florida, Inc.
Total-Tel U.K., Ltd.
ANNEX I (cont.)
PENDING LITIGATION
ANNEX I (cont.)
EXISTING INDEBTEDNESS
-NONE-
ANNEX I (cont.)
PERMITTED EXISTING LIENS
-NONE-
$13,000,000.00
AMENDED AND RESTATED EQUIPMENT FACILITY
AND REVOLVING CREDIT AGREEMENT
By and Between
SUMMIT BANK,
as Bank
and
TOTAL-TEL USA COMMUNICATIONS, INC.,
TOTAL-TEL, INC.,
TOTAL-TEL USA, INC.,
TOTAL-TEL CARRIER SERVICES, INC.,
and
TOTAL-TEL INTERNATIONAL, LTD.
as Borrowers
Dated as of ___________ ___, 1997
BORROWER GUARANTY AND SURETYSHIP AGREEMENT
This BORROWER AND SURETYSHIP AGREEMENT, dated as of __________
___, 1998 (together with all modifications and amendments hereto in
effect from time to time, this Guaranty) is made by TOTAL-TEL USA
COMMUNICATIONS, INC., a New Jersey corporation (Total-Tel Comm),
TOTAL-TEL, INC., a New Jersey corporation, TOTAL-TEL USA, INC., a New
Jersey corporation, TOTAL-TEL CARRIER SERVICES, INC., a New Jersey
corporation, TOTAL-TEL INTERNATIONAL, INC., a __________ corporation,
TOTAL-TEL SOUTHEAST, INC., a Georgia corporation (Total-Tel
Southeast), TOTAL-TEL SERVICES, INC., a New Jersey corporation
(Total-Tel Services), TOTAL-TEL FLORIDA, INC., a New Jersey
corporation (Total-Tel Florida), and TOTAL-TEL U.K., LTD., a
corporation organized under the laws of the United Kingdom (Total-Tel
U.K.) (each a Guarantor and collectively the Guarantors), in favor of
SUMMIT BANK, a banking corporation organized under the laws of the
State of New Jersey (the Bank).
BACKGROUND
The Guarantors are the Borrowers, on a joint and several basis,
under and pursuant to that certain Amended and Restated Equipment
Facility and Revolving Credit Agreement, dated even date herewith,
with the Bank (such agreement, together with any amendments,
modifications, renewal or extensions thereof, the Credit Agreement)
and to induce the Bank to make the credit accommodations available to
each Guarantor thereunder and to make additional loans, extensions of
credit or other financial accommodations to the Obligors (as defined
below) now or in the future, and to further secure the observance,
payment, and performance of the Obligations (as defined below) by
each of the Guarantors and other Obligors, and with full knowledge
that the Bank would not make said loans, extensions of credit, or
financial accommodations without this Guaranty, which shall be a
contract of suretyship, each Guarantor unconditionally, and intending
to be legally bound hereby, agrees as follows:
A. Obligations Guarantied. Each Guarantor, jointly and
severally, hereby guaranties the full, prompt, and unconditional
payment of the Obligations (as defined below), when and as the same
shall become due, whether at the stated maturity date, by
acceleration, or otherwise, and the full, prompt, and unconditional
performance of each and every term and condition of every covenant
and agreement to be kept and performed by any of them and/or by any
other Obligor under the Credit Agreement and each other Credit
Document (as defined below). This Guaranty is a primary obligation
of each Guarantor and shall be a continuing inexhaustible Guaranty
without limitation as to amount or duration and may not be revoked by
any Guarantor except by notice in writing by such Guarantor to the
Bank and received by the Bank at least 30 days prior to the date set
for such revocation. No such notice shall affect such Guarantor's
liability under this Guaranty for any loan, extension of credit, or
other financial accommodation made to or committed to be made to any
of them and/or to any other Obligor by the Bank occurring prior to
the effective date of the revocation, regardless of whether such loan
or extension of credit was made before or after notice of revocation.
B. Definitions. As used herein, the following terms shall have
the following meanings:
1. Collateral. The term Collateral means all of the
"Collateral" as such term is defined in that certain Amended and
Restated Security Agreement of the Guarantors in favor of the Bank,
dated as of even date herewith (hereinafter, the Security Agreement)
and any other property of any Guarantor, and/or other Obligor, now or
hereafter in the possession of the Bank, in any capacity whatsoever
including, but not limited to, any balance or share of any deposit,
trust or agency account and all property and assets of any Guarantor
and/or other Obligor now or hereafter subject to a security
agreement, pledge, mortgage, assignment or other document or
agreement granting the Bank a security interest therein or lien or
encumbrance thereon.
2. Credit Documents. The term Credit Documents means this
Guaranty, the Credit Agreement, the Security Agreement, each "Credit
Document" referenced therein, and all other credit accommodations,
notes, loan agreements, guarantees, security agreements, mortgages,
instruments, pledge agreements, assignments, acceptance agreements,
commitments, facilities, reimbursement agreements and any other
agreements, documents and instruments, now or hereafter existing,
creating, evidencing, guarantying, securing or relating to any or all
of the Obligations, together with all amendments, modifications,
renewals, or extensions thereof.
3. Obligations. The term Obligations means any and all
obligations and indebtedness of every kind and description of any
Guarantor or of any other Obligor owed to the Bank (including,
without limitation, all such obligations and indebtedness arising
under the Credit Agreement and the other Credit Documents and any
amendments, modifications, extensions, supplements or renewals of any
of the foregoing) whether primary or secondary, direct or indirect,
absolute or contingent, sole, joint or several, secured or unsecured,
due or to become due, contractual or tortious, arising by operation
of law or otherwise, or now or hereafter existing, whether incurred
by a Guarantor or any other Obligor as principal, surety, endorser,
guarantor, accommodation party or otherwise, including, without
limitation, principal, interest and fees including, without
limitation, late fees and expenses, including, without limitation,
attorneys' fees and costs and/or allocated fees and costs of the
Bank's in-house legal counsel.
4. Obligor. The term Obligor means each Guarantor and each
and every maker, endorser, guarantor, and surety of or for the
Obligations.
C. Representations and Warranties; Covenants. Each Guarantor
covenants, represents and warrants as of the date hereof and at all
times hereafter until the Obligations are fully paid and performed,
and any commitments to make loans, extensions of credit, or other
financial accommodations to any Obligor have been terminated, as
follows:
1. Execution of the Guaranty. This Guaranty and any other
Credit Document to which any Guarantor is a party have been duly
executed and delivered to the Bank by each Guarantor. Execution,
delivery and performance of this Guaranty and any other Credit
Document to which any Guarantor is a party will not (i) violate any
of such Guarantor's organizational documents, any provision of law,
any order of any court, agency, or instrumentality of government, or
any provision of any indenture, agreement, or other instrument to
which it is a party or by which it or any of its properties is bound;
(ii) result in the creation or imposition of any lien, charge, or
encumbrance of any nature, other than the liens created by the Credit
Documents; or (iii) require any authorization, consent, approval,
license, exemption of, or filing or registration with, any court or
governmental authority.
2. Obligations of the Guarantor. This Guaranty and any
other Credit Document to which any Guarantor is a party are the
legal, valid, and binding obligations of each Guarantor, enforceable
against it in accordance with their terms, except as the same may be
limited by bankruptcy, insolvency, reorganization, or other laws or
equitable principles relating to or affecting the enforcement of
creditors' rights generally. Total-Tel, Inc. Total-Tel USA, Inc.,
Total-Tel Carrier Services, Inc., Total-Tel International, Inc.,
Total-Tel Southeast, Total-Tel Services, Total-Tel Florida and Total-
Tel U.K. are each the wholly owned subsidiaries of Total-Tel Comm and
the business and operations of such corporations are related and have
a common business purpose. To permit the uninterrupted and
continuous operations of such common economic enterprise, such
corporations now require and will from time to time hereafter require
funds for general business purposes. Accordingly, the proceeds of
advances under the Credit Agreement will provide material direct and
indirect benefits to each Guarantor, regardless of which corporation
receives part or all of the proceeds of such advances.
D. No Limitation of Liability. Without incurring responsibility
to any Guarantor and without impairing or releasing the obligations
of any Guarantor to the Bank, the Bank may, at any time, and from
time to time, without the consent of, or notice to any Guarantor,
upon any terms or conditions, and in whole or in part:
1. Payment Terms. Change the manner, place, or terms of
payment, and/or change or extend the time for payment, or renew or
alter, any of the Obligations, any security therefor or any of the
Credit Documents evidencing same, and the Guaranty herein made shall
apply to the Obligations and the Credit Documents as so changed,
extended, renewed, or altered;
2. Sale of Property. Sell, exchange, release, surrender,
realize upon, or otherwise deal with in any manner and in any order,
any property by whomsoever at any time pledged, mortgaged, or in
which a security interest is given to secure, or howsoever securing,
the Obligations;
3. Failure to Exercise Rights. Exercise or refrain from
exercising any rights against any Guarantor or any other Obligor or
against any Collateral for the Obligations or otherwise act or
refrain from acting;
4. Settlement of Obligations. Settle or compromise any
Obligations, dispose of any Collateral therefor, with or without
consideration, or settle or compromise any liability incurred
directly or indirectly in respect thereof or hereof, and subordinate
the payment of all or any part thereof to the payment of any
Obligations;
5. Application of Funds. Apply any sums by whomsoever paid
or howsoever realized to any Obligations;
6. Release of Obligations. Add, release, settle, modify, or
discharge the obligation of any Obligor or any other party who is in
any way obligated for any of the Obligations;
7. Additional Security. Accept any additional security for
the Obligations in any order deemed appropriate by the Bank; and/or
8. Any Other Action. Take any other action which might
constitute a defense available to, or a discharge of, any Obligor
(including any Guarantor), in respect of the Obligations.
The invalidity, irregularity, or unenforceability of all or any
part of the Obligations or any Credit Document or any agreement or
instrument relating thereto, or the lack of validity, enforceability,
perfection, impairment or loss of any liens or security interests
granted in connection therewith, whether caused by any action or
inaction of the Bank or otherwise, shall not affect, impair, or be a
defense to any Guarantor's obligations under this Guaranty.
E. Waiver of Subrogation. Each Guarantor irrevocably waives any
present or future right to which it is or becomes entitled to be
subrogated to the Bank's rights against any other Guarantor or
Obligor or to seek contribution, reimbursement, indemnification,
payment or the like from any other Guarantor or Obligor on account of
this Guaranty or any other Credit Document. If, notwithstanding such
waiver, any funds or property shall be paid or transferred to a
Guarantor on account of such subrogation, indemnification, or
contribution at any time when all of the Obligations have not been
paid in full, such Guarantor shall hold such funds and/or property in
trust for the Bank and shall segregate such funds and/or property
from other funds of such Guarantor and shall forthwith pay over or
deliver to the Bank such funds and/or property for application by the
Bank to the Obligations, whether matured or unmatured, in accordance
with the terms of the Credit Documents.
F. Events of Default and Remedies. The occurrence of an "Event
of Default" under any Credit Document shall constitute an Event of
Default hereunder. Upon and following an Event of Default, the Bank
may proceed to protect and enforce the Bank's rights hereunder and/or
under applicable law by action at law, in equity or other appropriate
proceeding including, without limitation, an action for specific
performance to enforce or aid in the enforcement of any provision
contained herein or in any other Credit Document.
G. Continuation of Guaranty.
1. Settlements. Settlement of any claim by the Bank against
any Guarantor or other Obligor, whether in any proceeding or not, and
whether voluntary or involuntary, shall not reduce the amount due
under the terms of this Guaranty except to the extent of the amount
actually paid by a Guarantor or any other Obligor and legally
retained by the Bank in connection with the settlement.
2. Indemnification Upon Recision. If, after receipt of any
payment of all or any part of the Obligations or the obligations of
any Guarantor to the Bank, the Bank is compelled or agrees, for
settlement purposes, to surrender such payment to any person or
entity for any reason (including, without limitation, a determination
that such payment is void or voidable as a preference or fraudulent
conveyance, an impermissible setoff, or a diversion of trust funds),
then this Guaranty and the other Credit Documents shall continue in
full force and effect or be reinstated, as the case may be, and the
Guarantors shall be liable for, and shall indemnify, defend and hold
harmless the Bank with respect to the full amount so surrendered.
The provisions of this Section shall survive the termination of this
Guaranty and the other Credit Documents and shall be and remain
effective notwithstanding the payment of the Obligations, the
cancellation of the Guaranty or any other Credit Document, the
release of any security interest, lien or encumbrance securing the
Obligations, the cancellation of the Guaranty or any other Credit
Document or any other action which the Bank may have taken in
reliance upon its receipt of such payment. Any cancellation of the
Guaranty, release of any encumbrance, security interest or lien or
other such action shall be deemed to have been conditioned upon any
payment of the Obligations having become final and irrevocable.
H. Miscellaneous.
1. Notices. Notices and communications under this Guaranty
shall be given in the manner prescribed in the Credit Agreement.
2. Costs, Expenses and Professional Fees. Whether or not
the transactions contemplated by the Credit Documents are fully
consummated, the Guarantors shall promptly pay (or reimburse, as the
Bank may elect) all costs and expenses which the Bank has incurred or
may hereafter incur in connection with the negotiation, preparation,
reproduction, interpretation, perfection, administration and
enforcement of this Guaranty, the collection of all amounts due under
this Guaranty, and all amendments, modifications, consents or
waivers, if any, to this Guaranty. Such costs and expenses shall
include, without limitation, the fees and disbursements of counsel to
the Bank (including the Bank's in-house counsel). The Guarantors'
reimbursement obligations under this Section shall survive any
termination of the Credit Documents.
3. Governing Law. This Guaranty shall be construed in
accordance with and governed by the substantive laws of the State of
New Jersey without reference to conflict of laws principles.
4. Integration, Amendment. This Guaranty and the other
Credit Documents constitute the sole agreement of the parties with
respect to the subject matter hereof and thereof and supersede all
oral negotiations and prior writings with respect to the subject
matter hereof and thereof. No amendment of this Guaranty, and no
waiver of any one or more of the provisions hereof shall be effective
unless set forth in writing and signed by each Guarantor and the
Bank.
5. Successors and Assigns. This Guaranty (i) shall be
binding upon each Guarantor and the Bank and their respective
successors and permitted assigns, and (ii) shall inure to the benefit
of each Guarantor and the Bank and their respective successors and
permitted assigns; provided, however, that no Guarantor may assign
its interests or obligations hereunder without the prior written
consent of the Bank, and any such assignment or attempted assignment
by a Guarantor shall be void and of no effect with respect to the
Bank.
6. Severability and Consistency. The illegality or
unenforceability of any provision of this Guaranty or any instrument
or agreement required hereunder shall not in any way affect or impair
the legality or enforceability of the remaining provisions of this
Guaranty or any instrument or agreement required hereunder. The
Credit Documents are intended to be consistent. However, in the
event of any inconsistencies among any of the Credit Documents, such
inconsistency shall not affect the validity or enforceability of each
Credit Document. The Guarantors agree that in the event of any
inconsistency or ambiguity in any of the Credit Documents, the Credit
Documents shall not be construed against any one party but shall be
interpreted consistent with the Bank's policies and procedures.
7. Consent to Jurisdiction and Service of Process. Each
Guarantor irrevocably appoints each and every corporate officer of
such Guarantor as its attorneys upon whom may be served, by regular
or certified mail at the address set forth in this Guaranty, any
notice, process or pleading in any action or proceeding against it
arising out of or in connection with this Guaranty or any of the
other Credit Documents. Each Guarantor hereby consents that any
action or proceeding against it may be commenced and maintained in
any court within the State of New Jersey or in the United States
District Court for the District of New Jersey by service of process
on any such officer. Each Guarantor further agrees that such courts
of the State of New Jersey and the United States District Court for
the District of New Jersey shall have jurisdiction with respect to
the subject matter hereof and the person of such Guarantor and all
Collateral for the Obligations. Notwithstanding the foregoing, each
Guarantor agrees that any action brought by such Guarantor shall be
commenced and maintained only in a court in the federal judicial
district or county in which the Bank has its principal place of
business in New Jersey.
8. Headings. The headings of sections and paragraphs have
been included herein for convenience only and shall not be considered
in interpreting this Guaranty.
9. Judicial Proceeding; Waivers.
a. EACH PARTY TO THIS GUARANTY AGREES THAT ANY SUIT,
ACTION OR PROCEEDING WHETHER CLAIM OR COUNTERCLAIM, BROUGHT OR
INSTITUTED BY ANY PARTY HERETO OR ANY SUCCESSOR OR ASSIGN OF ANY
PARTY, ON OR WITH RESPECT TO THIS GUARANTY OR ANY OF THE OTHER CREDIT
DOCUMENTS OR THE DEALINGS OF THE PARTIES WITH RESPECT HERETO, OR
THERETO, SHALL BE TRIED ONLY BY A COURT AND NOT BY A JURY.
b. EACH GUARANTOR AND THE BANK HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN
ANY SUCH SUIT, ACTION OR PROCEEDING. FURTHER, EACH PARTY WAIVES ANY
RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY SUCH SUIT, ACTION OR
PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES
OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES.
c. EACH GUARANTOR ACKNOWLEDGES AND AGREES THAT THIS
SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS GUARANTY AND THAT
THE BANK WOULD NOT EXTEND CREDIT TO ANY GUARANTOR OR OTHER OBLIGOR IF
THE WAIVERS SET FORTH IN THIS SECTION WERE NOT A PART OF THIS
GUARANTY. EACH GUARANTOR HEREBY WAIVES PRESENTMENT, NOTICE OF
DISHONOR AND PROTEST OF ALL INSTRUMENTS INCLUDED IN OR EVIDENCING THE
OBLIGATIONS OR THE COLLATERAL, IF ANY, AND ALL OTHER NOTICES AND
DEMANDS WHATSOEVER, WHETHER OR NOT RELATING TO SUCH INSTRUMENTS.
IN WITNESS WHEREOF, this Guaranty has been duly executed and
delivered to the Bank by each Guarantor on the day and year first
above written.
TOTAL-TEL USA COMMUNICATIONS, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL USA, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL CARRIER SERVICES, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL INTERNATIONAL, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL SOUTHEAST, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL SERVICES, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL FLORIDA, INC.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
TOTAL-TEL U.K., LTD.
WITNESS OR ATTEST:
By:___________________________ By:______________________________
Name: Name:
Title: Title:
ACKNOWLEDGED AND ACCEPTED BY:
SUMMIT BANK
By:________________________
Name:
Title:
AMENDED AND RESTATED SECURITY AGREEMENT
This SECURITY AGREEMENT, is dated as of this ________ day of
________, 1998 (this Agreement), made by TOTAL-TEL USA
COMMUNICATIONS, INC., a New Jersey corporation (Total-Tel Comm),
TOTAL-TEL, INC., a New Jersey corporation (Total-Tel), TOTAL-TEL USA,
INC., a New Jersey corporation (Total-Tel USA), TOTAL-TEL CARRIER
SERVICES, INC., a New Jersey corporation, TOTAL-TEL INTERNATIONAL,
INC., a _____________ corporation, TOTAL-TEL SOUTHEAST, INC., a
Georgia corporation (Total-Tel Southeast), TOTAL-TEL SERVICES, INC.,
a New Jersey corporation (Total-Tel Services), TOTAL-TEL FLORIDA,
INC., a New Jersey corporation (Total-Tel Florida), and TOTAL-TEL
U.K., LTD., a corporation organized under the laws of the United
Kingdom (Total-Tel U.K.), in favor of SUMMIT BANK, a banking
corporation organized under the laws of the State of New Jersey (the
Bank). Total-Tel Comm, Total-Tel, Total-Tel USA, Total-Tel Carrier,
Total-Tel International, Total-Tel Southeast, Total-Tel Services,
Total-Tel Florida and Total-Tel U.K. are herein referred to as the
Borrowers, and each of the Borrowers are herein referred to
individually as a Grantor and collectively as the Grantors.
PRELIMINARY STATEMENT
A. The Bank has entered into that Amended and Restated
Equipment Facility and Revolving Credit Agreement of even date
herewith (said Credit Agreement, as it may be hereafter amended or
otherwise modified from time to time, being the Credit Agreement;
capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement)
with the Borrowers pursuant to which the Bank agreed to make
available to the Borrowers, in addition to the amounts outstanding
pursuant to the 1996 Equipment Facility which, as of the date hereof
totals $_____________, an equipment finance facility in the principal
amount of up to $5,000,000 and a revolving credit facility which,
when added to the Letter of Credit Outstanding, shall not exceed a
principal amount of $8,000,000. The obligations of the Borrowers
thereunder is evidenced by the Equipment Facility Note and the
Amended and Restated Revolving Credit Note referred to therein.
B. To support said obligations of the Borrowers under the
Credit Agreement, the Borrowers have executed and delivered to the
Bank that certain Borrower Guaranty and Suretyship Agreement of even
date herewith in favor of the Bank (the Borrower Guaranty).
C. It is a condition to the availability of the credit
facilities under the Credit Agreement that the Grantors shall have
granted to the Bank the security interests contemplated by this
Agreement.
D. All capitalized terms used herein and not defined herein
shall have the meanings set forth in the Credit Agreement.
NOW, THEREFORE, in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and in order to induce the Bank to make the
credit facilities under the Credit Agreement available to the
Borrowers, the Grantors hereby agree as follows:
SECTION 1. Grant of Security. Each Grantor hereby grants and
assigns to the Bank a security interest in all of such Grantor's
right, title and interest in and to the following assets
(collectively, the Collateral):
(a) any and all equipment, including without limitation,
digital switching equipment and computer equipment and software that
is used or useful in such Grantor's long distance telephone service
business located at the Grantors' facilities at 000 Xxxxx Xxxxxx in
Newark, New Jersey, at ______________, New York, and at
_____________, Florida, (ii) such other equipment of the type
described in clause (i) above, wherever located, if the acquisition
of such equipment was or will be financed by the use of proceeds of
Equipment Loans or Revolving Credit Loans made under the Credit
Agreement, or the 1996 Equipment Loan referenced in the Credit
Agreement, and (iii) all tools, tooling, molds, templates, drawings,
schematics and other design descriptions of, and manufacturer's
manuals pertaining to, the foregoing; together with all parts and
replacements thereof, accessions and additions thereto and
substitutions and exchanges therefor (any and all such equipment,
parts, accessions, additions, substitutions and replacements being
the Equipment); and
(b) all of such Grantor's books and records indicating,
summarizing, evidencing or relating to the Equipment or the
Obligations; computer runs, invoices, tapes, processing software,
processing contracts (such as contracts for computer time and
services) and any computer prepared information, tapes, or data of
every kind and description, whether in the possession of such Grantor
or in the possession of third parties that are used or useful in the
operation of the Equipment; and
(c) any and all "Proceeds" of the foregoing (as such term is
defined in the Uniform Commercial Code in effect from time to time in
the State of New Jersey (hereinafter, the UCC)), whether cash or non-
cash, together with any insurance indemnity, warranty or guaranty
payable to such Grantor from time to time with respect to any of the
Collateral, any and all payments (in any form whatsoever) made or due
and payable to such Grantor from time to time in connection with any
requisition, confiscation, condemnation, seizure or forfeiture of all
or part of the Collateral by any governmental body, authority, bureau
or agency or any other Person (whether or not acting under color of
governmental authority), and any and all other amounts from time to
time paid or payable under or in connection with any of the foregoing
Collateral; but specifically excluding any accounts receivable or
notes receivable of such Grantor generated by the use of the
Collateral in the ordinary course of such Grantor's business;
in each case, whether now owned or hereafter acquired by such Grantor
and howsoever its interest therein may arise or appear (whether by
ownership, security interest, claim or otherwise).
SECTION 2. Security for Obligations. The Collateral secures
the payment of all obligations and indebtedness of Grantor or any
other Obligor, owed to the Bank arising under or in connection with
the indebtedness evidenced by the Equipment Facility Note, the
Revolving Credit Note and the 1996 Term Note, whether such
indebtedness is incurred under such Note, the Credit Agreement, the
Borrower Guaranty, or any amendments, modifications, extensions,
supplements or renewals of any of the foregoing, whether such
obligations are primary or secondary, direct or indirect, absolute or
contingent, sole, joint or several, contractual or tortious, due or
to become due, arising by operation of law or otherwise, and whether
incurred by a Grantor or any other Obligor as principal, surety,
endorser, guarantor, accommodation party, or otherwise, including,
but not limited to, all late fees, collections fees and expenses, and
attorneys' fees and costs and/or allocated fees and costs of the
Bank's in-house counsel, in each case incurred in connection
therewith (all such obligations and indebtedness of any Grantor
and/or any other Obligor described in this Section 2 being
collectively hereinafter referred to as the Obligations).
SECTION 3. Delivery with Respect to Certain Collateral. If a
Grantor shall receive, by virtue of its being or having been an owner
of any Collateral, any (i) certificate, promissory note or other
instrument or (ii) option or right, whether as an addition to, or in
substitution or exchange for, any Collateral, or otherwise, such
Grantor shall receive such items in trust for the benefit of the
Bank, shall segregate them from such Grantor's other assets and
shall, to the extent evidenced by a writing, deliver said writing
forthwith to the Bank in the exact form received, with any necessary
assignments, endorsements or consents to the transfer of said
interests to the Bank, to be held by the Bank as Collateral and as
further security for the Obligations.
SECTION 4. As to Equipment. (a) No Grantor will do anything
to impair the rights of the Bank in the Equipment. Each Grantor
shall keep the Equipment in which it is granting a security interest
thereunder at the places specified in Section 8(c) or, upon 30 days'
prior written notice to the Bank, at such other places in
jurisdictions where all action required by Section 9 shall have been
taken with respect to such Equipment.
(b) The Bank shall have the right to adjust any material
claim under insurance on the Equipment. Subject to Section 10(c)
hereof, the Bank may apply any proceeds of insurance received by it
toward the payment of any of the Obligations, whether or not the same
shall then be due.
(c) Each Grantor shall retain all liability and
responsibility in connection with the Equipment in which it is
granting a security interest hereunder; and its liability under the
Credit Documents shall in no way be affected or diminished by reason
of the fact that any such Equipment may be lost, destroyed, stolen,
damaged or for any reason whatsoever be unavailable to it.
(d) Upon the request of the Bank, each Grantor to which such
request has been made will, at its own expense, shall, execute,
endorse, acknowledge, file and/or deliver to the Bank from time to
time such lists, descriptions and designations of its Equipment,
warehouse receipts, bills of lading, documents of title, vouchers,
such invoices, schedules, confirmations, assignments, conveyances,
financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments and take
such further steps relating to such Equipment and other property or
rights covered by the security interest hereby granted, which the
Bank deems reasonably appropriate or advisable to perfect, preserve
or protect its security interest therein. The Bank may at any time
notify any bailee of any Equipment of its security interests therein.
(e) Each Grantor shall cause the Equipment in which it is
granting a security interest hereunder to be maintained and preserved
in the same condition, repair and working order as when new, ordinary
wear and tear excepted, and in accordance with any manufacturer's
manual, and shall forthwith, or in the case of any loss or damage to
any of such Equipment as promptly as practicable after the occurrence
thereof, make or cause to be made all repairs, replacements and other
improvements in connection therewith which are necessary or desirable
to such end. Each relevant Grantor shall promptly furnish to the
Bank a statement respecting any loss or damage to any of such
Equipment.
(f) Each Grantor shall pay promptly when due all property
and other taxes, assessments and governmental charges or levies
imposed upon payer, and all claims (including claims for labor,
materials and supplies) against, the Equipment in which it is
granting a security interest hereunder, except to the extent
contested in good faith by appropriate proceedings and for which
adequate reserves have been maintained.
(g) No Grantor shall permit any of the Equipment in which it
is granting a security interest hereunder to become fixtures to real
estate or accessions to other personal property unless the Bank has a
first priority security interest in such real estate or personal
property.
SECTION 5. Filing and Recording Costs. The Grantors shall pay
the filing and recording costs of any documents or instruments
necessary to perfect, extend, modify, or terminate the security
interests created hereunder, as demanded by the Bank.
SECTION 6. Default. The Grantors shall be in default hereunder
if there occurs an Event of Default under any of the Credit
Documents. In the event of any such default, the Bank shall have all
of the rights and remedies set forth in the Credit Agreement, the
other Credit Documents, hereunder and as available at law or equity.
SECTION 7. Grantors Remain Liable. Anything herein to the
contrary notwithstanding, (a) each Grantor shall remain liable under
the contracts and agreements included in the Collateral to the extent
set forth therein to perform all of its duties and obligations
thereunder to the same extent as if this Agreement had not been
executed, (b) the exercise by the Bank of any of the rights hereunder
shall not release any Grantor from any of its duties or obligations
under the contracts and agreements included in the Collateral, and
(c) the Bank shall not have any obligation or liability under the
contracts and agreements included in the Collateral by reason of this
Agreement, nor shall the Bank be obligated to perform any of the
obligations or duties of the relevant Grantor thereunder or to take
any action to collect or enforce any claim for payment assigned
hereunder.
SECTION 8. Representations and Warranties. Each Grantor
represents and warrants that:
(a) such Grantor has exclusive possession and control of the
Equipment in which it is granting a security interest hereunder;
(b) such Grantor owns the Collateral in which it is granting
a security interest hereunder free and clear of any lien (other than
those liens held by the Bank), security interest, charge or
encumbrance;
(c) set forth on Schedule I is: (i) the address of the
chief executive office (as such term is used in the UCC) of such
Grantor; (ii) all locations where the Equipment in which it is
granting a security interest hereunder is kept, used or maintained;
and (iii) the record owners of all such locations;
(d) all necessary consents required to permit the security
interest, encumbrance and assignments granted herein have been
obtained;
(e) to the extent that ownership or possession of any of the
Equipment is evidenced by a certificate of title or similar
instrument, such certificates and instruments have been delivered to
the Bank with all necessary or advisable endorsements; and
(f) upon the proper and timely filing of UCC financing
statements in the filing offices set forth on Schedule I, the Bank
will have a duly perfected, legal, valid and enforceable first
priority security interest in and to the Collateral against all third
parties, and all action required to fully perfect the Bank's security
interest in and to the Collateral will have been taken and completed.
SECTION 9. Further Assurances. (a) Each Grantor agrees that
from time to time, at the expense of such Grantor, it will promptly
execute and deliver all further instruments and documents, and take
all further action, that may be necessary or that the Bank may
reasonably request, in order to perfect and protect any security
interest granted or purported to be granted hereby or to enable the
Bank to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the
foregoing, each Grantor will execute and file such financing or
continuation statements, or amendments thereto, and such other
instruments or notices as may be necessary and as the Bank may
reasonably request, in order to perfect and preserve the security
interests granted or purported to be granted
hereby.
(b) Each Grantor hereby irrevocably authorizes the Bank to
file financing statements (and amendments thereto and continuations
thereof) relative to all or any part of the Collateral without the
signature of such Grantor. The Bank agrees to provide the relevant
Grantor with copies of the same. A photocopy or other reproduction
of this Agreement or any financing statement covering the Collateral
or any part thereof shall be sufficient as a financing statement
where permitted by law. The Bank shall have no obligation to file
any such financing statements.
(c) The Grantors will furnish to the Bank, from time to
time, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral
as the Bank may in its sole discretion reasonably request, all in
reasonable detail.
SECTION 10. Covenants as to the Collateral Generally. Each
Grantor shall:
(a) at its own cost and expense, consistent with current
practices of such Grantor, keep and maintain satisfactory and
complete records with respect to its Equipment and make available to
the Bank such books and records at any and all reasonable times upon
reasonable demand by the Bank;
(b) at its own cost and expense, defend the Bank's right,
title and security interest in and to the Collateral against the
claims of any person or entity;
(c) at its own cost and expense, maintain insurance with
respect to the Collateral in such amounts, against such risks, in
such form and with such insurers, as shall be satisfactory to the
Bank from time to time. Each policy for liability insurance shall
provide for all losses to be paid on behalf of the Bank and the
relevant Grantor as their respective interests may appear and each
policy for property damage insurance shall provide for all losses to
be paid directly to the Bank. Notwithstanding anything to contrary
set forth herein, with respect to any loss of Collateral in an amount
less than or equal to $100,000.00 in the aggregate and provided there
is then no continuing Event of Default, the Bank shall permit the
application of any insurance proceeds to the restoration, replacement
or repair of the affected Collateral, and the relevant Grantor shall
be obligated to so replace or repair the same. Each such policy
shall in addition (i) name the Bank as loss payee and additional
insured thereunder as its interests may appear, (ii) contain the
agreement by the insurer that any loss thereunder shall be payable to
the Bank notwithstanding any action, inaction or breach of
representation or warranty by the relevant Grantor, (iii) provide
that there shall be no recourse against the Bank for payment of
premiums or other amounts with respect thereto, and (iv) provide that
at least 30 days' prior written notice of cancellation or of lapse
shall be given to the Bank by the insurer. The relevant Grantor
shall, if so requested by the Bank, deliver to the Bank original or
duplicate policies of such insurance and, as often as the Bank may
reasonably request a report of a reputable insurance broker with
respect to such insurance. Further, the relevant Grantor shall, at
the request of the Bank, duly execute and deliver such insurance
policies to comply with the requirements of this Section 10;
(d) not create or suffer to exist any Lien, security
interest or other charge or encumbrance upon or with respect to any
Collateral;
(e) not take or fail to take any action which should
reasonably be taken in order that the value or enforceability of any
Collateral not be impaired;
(f) not move the Equipment in which such Grantor has granted
a security interest hereunder, cause such Equipment to be annexed or
permanently affixed to any real property; or otherwise take any
actions as to the Collateral which will, under applicable law, cause
the security interests of the Bank therein to become unperfected or
cause the priority of such security interests to be adversely
affected in any manner; and
(g) not sell, assign, lease, or otherwise dispose (whether
voluntary or involuntarily) of any of the Collateral, or relinquish
exclusive possession or control of any Equipment in which such
Grantor has granted a security interest hereunder.
SECTION 11. Bank Appointed Attorney-in-Fact. The Bank is
hereby irrevocably appointed the attorney-in-fact for each Grantor,
with full authority in the place and stead of and in the name of such
Grantor, the Bank or otherwise, to take any action and to execute any
instrument which the Bank may deem necessary or advisable to
accomplish the purposes of this Agreement, including:
(a) to file any claims or take any action or institute any
proceedings which the Bank may deem necessary or desirable for the
collection of any of the Collateral or otherwise to enforce the
rights of the Bank with respect to any of the Collateral;
(b) to execute on behalf of any Grantor any and all
documents, including, without limitation, the Agreements, as may be
necessary for the collection of any Collateral or to establish the
Accounts; and
(c) to execute financing statements on behalf of any
Grantor.
The power of attorney granted hereby shall be a present grant of
an irrevocable power of attorney, coupled with an interest; provided,
however, the Bank agrees not to exercise the same (other than in
Section 11(c), above, which right the Bank may exercise at any time)
until the occurrence of an Event of Default. The foregoing grant of
power of attorney shall not in any manner create, or be deemed to
create, any fiduciary relationship or other relationship of trust
between the Bank and any Grantor, it being understood and agreed that
the relationship of the Bank and each Grantor is that of creditor and
debtor.
SECTION 12. Bank May Perform. Except as otherwise provided
herein, if any Grantor fails to perform any agreement contained
herein, the Bank may itself perform, or cause performance of, such
agreement, and the reasonable expenses of the Bank incurred in
connection therewith shall be payable by the Grantors under Section
15(b) hereof.
SECTION 13. The Bank's Duties. The powers conferred on the
Bank hereunder are solely to protect its interest in the Collateral
and shall not impose any duty upon it to exercise any such powers.
Except for the safe custody of any Collateral in its possession, and
the accounting for moneys actually received by, it the Bank shall
have no duty as to any Collateral or as to the taking of any
necessary steps to preserve rights against prior parties or any other
rights pertaining to any Collateral.
SECTION 14. Remedies. If any Event of Default under the Credit
Agreement or any other Credit Document shall have occurred and be
continuing:
(a) The Bank may exercise in respect of the Collateral, in
addition to other rights and remedies provided for herein or
otherwise available under law to it, all the rights and remedies of a
secured party under the UCC (whether or not the UCC applies to the
affected Collateral), and also may (i) require any relevant Grantor
to, and each such Grantor hereby agrees that it will at its expense
and upon the request of the Bank forthwith, assemble all or part of
the Collateral as directed by the Bank and make it available to the
Bank at a place to be designated by the Bank which is reasonably
convenient to both parties, and (ii) with such telephone or other
notice, if any, as is required by law and practicable under the
circumstances or as specified below, sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any of
the Bank's offices or elsewhere, for cash, on credit or for future
delivery, and at such price or prices and upon such other terms as
are commercially reasonable. Each Grantor agrees that, to the extent
notice of sale shall be required by law, at least 10 days' written
notice to any relevant Grantor of the time and place of any public
sale or the time after which any private sale is to be made shall
constitute reasonable notification. The Bank shall not be obligated
to make any sale of Collateral, regardless of notice of sale having
been given. The Bank may adjourn any public or private sale from
time to time by announcement at the time and place fixed therefor,
and such sale may, without further notice, be made at the time and
place to which it was so adjourned.
(b) All cash proceeds received by the Bank in respect of any
sale of, collection from, or other realization upon all or any part
of the Collateral may, in the discretion of the Bank, be held by the
Bank as collateral for, and/or then or at any time thereafter applied
(after payment of any amounts payable to the Bank pursuant to Section
15 hereof) by the Bank against, all or any part of the Obligations in
such order as the Bank shall elect. Any surplus of such cash
proceeds held by the Bank and remaining after payment in full of all
the Obligations evidenced by or arising under the Equipment Facility
Note as contemplated in Section 2 hereof shall be paid over to the
relevant Grantor or to whomsoever may be lawfully entitled to receive
such surplus.
SECTION 15. Indemnity and Expenses. (a) Each Grantor agrees
to indemnify the Bank from and against any and all claims, losses and
liabilities growing out of or resulting from this Agreement or the
Collateral (including, without limitation, enforcement of this
Agreement), except claims, losses or liabilities resulting from the
Bank's gross negligence or willful misconduct. The provisions of
this Section 15(a) shall survive the termination of this Agreement.
(b) Each Grantor will upon demand pay to the Bank the amount
of any and all reasonable expenses, including the reasonable fees and
disbursements of its counsel and of any experts and agents, which the
Bank may incur in connection with (i) the preparation of this
Agreement, (ii) the custody, preservation, use or operation of, or
the sale of, collection from, or other realization upon, any of the
Collateral, (iii) the exercise or enforcement of any of the rights of
the Bank hereunder, or (iv) the failure by a Grantor to perform or
observe any of the provisions hereof.
SECTION 16. Amendments; Etc. No amendment or waiver of any
provision of this Agreement nor consent to any departure by a Grantor
therefrom shall in any event be effective unless the same shall be in
writing and signed by the Bank and then such waiver or consent shall
be effective only in the specific instance and for the specific
purpose for which given.
SECTION 17. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing and mailed
by registered or certified mail, return receipt requested, to the
address specified in the Credit Agreement for the Bank and each
Grantor or to such other address as shall be designated by any party
in a written notice to the other parties complying as to delivery
with the terms of the Credit Agreement. All such notices and
communications shall be deemed delivered when delivered in accordance
with the terms of the Credit Agreement.
SECTION 18. Continuing Security Interest; Transfer of Notes.
This Agreement shall create a continuing security interest in the
Collateral and shall (i) remain in full force and effect until
payment in full of the Obligations, (ii) be binding upon each
Grantor, its successors and assigns and (iii) inure to the benefit of
the Bank and its successors and assigns. Without limiting the
generality of the foregoing clause (iii), subject to the restrictions
on transfer of the Credit Agreement, the Bank may assign or otherwise
transfer its interest in the Notes to any other Person and such other
Person shall thereupon become vested with all the benefits in respect
thereof granted to the Bank herein and otherwise. Upon the
indefeasible and final payment in full of the Obligations, the
security interest granted hereby shall terminate and all rights to
the Collateral shall revert to the relevant Grantor. Upon any such
termination, the Bank shall (at the Grantors' sole cost and expense)
execute and deliver to the relevant Grantor such documents as such
Grantor shall reasonably request to evidence such termination.
SECTION 19. Security Interest Absolute. The obligations of
each Grantor under this Agreement are independent of the Obligations
under any of the other Credit Documents, and a separate action or
actions may be brought and prosecuted against each Grantor to enforce
this Agreement, irrespective of whether any action is brought against
any other Obligor or whether any Grantor or any other Obligor is
joined in any such action or actions. All rights of the Bank
hereunder, and all Obligations of each Grantor hereunder, shall be
absolute and unconditional, irrespective of:
(a) any lack of validity or enforceability of any Credit
Document or any other agreement or instrument relating thereto;
(b) any change in the time, manner or place of payment of,
or in any other term of, or any release of all or any of the
Obligations or any other amendment or waiver of or any consent to any
departure from any Credit Document, including, without limitation,
any increase in the Obligations resulting from the extension of
additional credit to any Grantor, or otherwise;
(c) any taking, exchange, subordination, substitution,
release or non-perfection of any collateral, or any taking, release
or amendment or waiver of or consent to departure from any guaranty,
for all or any of the Obligations;
(d) any manner of application of Collateral, or proceeds
thereof, to all or any of the Obligations, or any manner of sale or
other disposition of any Collateral for all or any of the Obligations
or any other assets of any Grantor;
(e) any change, restructuring or termination of the
corporate structure or existence of any Grantor, or any insolvency,
bankruptcy, reorganization or other similar proceeding affecting any
Grantor or its assets or any resulting release or discharge of any
Obligation of any other Obligor under any Credit Document; or
(f) any other circumstance (including, but not limited to,
any statute of limitations) that might otherwise constitute a defense
available to, or a discharge of, the Obligations of any other
Obligor.
Without limiting the generality of the foregoing, each Grantor
hereby consents to, and hereby agrees, that the rights of the Bank
hereunder, and the liability of each Grantor hereunder, shall not be
affected by any and all releases for any purpose of any Collateral
from the liens and security interests created by any other security
agreement securing the Obligations. This Agreement shall continue to
be effective or be reinstated, as the case may be, if at any time any
payment of any of the Obligations is rescinded or must otherwise be
returned by the Bank upon the insolvency, bankruptcy, reorganization
or similar proceeding of any Grantor or otherwise, all as though such
payment had not been made.
SECTION 20. Governing Law; Terms. This Agreement shall be
governed by and construed in accordance with the laws of the State of
New Jersey without regard to conflict of laws principles. Unless
otherwise defined herein or in the Credit Agreement, terms used in
Article 9 of the UCC are used herein as therein defined.
IN WITNESS WHEREOF, each Grantor has caused this Agreement to be
duly executed and delivered by its duly authorized
officer as of the date first above written.
WITNESS/ATTEST: TOTAL-TEL USA COMMUNICATIONS, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL USA, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS OR ATTEST: TOTAL-TEL CARRIER SERVICES, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS OR ATTEST: TOTAL-TEL INERNATIONAL, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address:_____________________
_____________________
Telecopier:__________________
WITNESS OR ATTEST: TOTAL-TEL SOUTHEAST, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS OR ATTEST: TOTAL-TEL SERVICES, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS OR ATTEST: TOTAL-TEL FLORIDA, INC.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address:
Telecopier:
WITNESS OR ATTEST: TOTAL-TEL U.K., LTD.
By:___________________________ By:_____________________________
Name: Name:
Title: Title:
Address:
Telecopier:
ACCEPTED AND AGREED TO BY:
SUMMIT BANK
By:_____________________________
Name:
Title:
Address:_____________________
_____________________
Telecopier:__________________
470035v2
SCHEDULE I
TO
SECURITY AGREEMENT
Location of Chief Executive Office:
Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Locations of Equipment
000 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Lot ___, Block ___
________________________
________________________
England ____________
Record Owners of Equipment Location:
000 Xxxxx Xxxxxx Associates, L.L.C.
000 Xxxxx Xxxxxx
Xxxxxx, Xxx Xxxxxx 00000
Filing Offices
* Secretary of State of New Jersey
* Office of the Register of Essex County
CREDIT MODIFICATION AGREEMENT
This CREDIT MODIFICATION AGREEMENT (this "Agreement") is made
and entered into as of this ___ day of March, 1998 by and between
SUMMIT BANK (The "Bank"), a banking corporation organized under the
laws of the State of New Jersey, TOTAL-TEL USA COMMUNICATIONS, a New
Jersey corporation ("Total-Tel Comm"), TOTAL-TEL, INC., a New Jersey
corporation and wholly owned subsidiary of Total-Tel Comm ("Total-
Tel"), TOTAL-TEL USA, INC., a New Jersey corporation and wholly owned
subsidiary of Total-Tel Comm ("Total-Tel USA"), TOTAL-TEL CARRIER
SERVICES, INC., a New Jersey corporation and wholly owned subsidiary
of Total-Tel Comm ("Total-Tel Carrier"), TOTAL-TEL INTERNATIONAL,
INC., a New Jersey corporation and wholly owned subsidiary of Total-
Tel Comm ("Total-Tel International"), TOTAL-TEL SOUTHEAST, INC., a
Georgia corporation and wholly owned subsidiary of Total-Tel Comm
("Total-Tel Southeast"), TOTAL-TEL SERVICES, INC., a New Jersey
corporation and wholly owned subsidiary of Total-Tel Comm ("Total-Tel
Services"), TOTAL-TEL FLORIDA, INC., a New Jersey corporation and
wholly owned subsidiary of Total-Tel Comm ("Total-Tel Florida"), and
TOTAL-TEL U.K., LTD., a corporation organized under the laws of the
United Kingdom and a wholly owned subsidiary of Total-Tel Comm
("Total-Tel U.K."; Total-Tel Comm, Total-Tel, Total-Tel USA, Total-
Tel Carrier, Total-Tel International, Total-Tel Southeast, Total-Tel
Services, Total-Tel Florida and Total-Tel U.K. are hereafter each
referred to as a "Borrower" and collectively referred to as the
"Borrowers").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Equipment Facility and
Revolving Credit Agreement dated August 23, 1996 (the "1996
Agreement"), the Bank made available to Total-Tel Comm, Total-Tel,
Total-Tel USA and Total-Tel Carrier an equipment purchase facility in
the principal amount of up to $6,000,000 (the "1996 Equipment
Facility") for the purpose of financing the acquisition from time to
time of certain digital switching equipment and related computer
equipment to be used in the operation of such Borrowers' long
distance telephone service business ("Financed Equipment"); and
WHEREAS, pursuant to the 1996 Agreement, the Bank further made
available to Total-Tel Comm, Total-Tel, Total-Tel USA and Total-Tel
Carrier a committed revolving credit facility, pursuant to which such
borrowers were able to request advances from time to time in a
principal amount of up to $4,000,000 outstanding at any time (the
"1996 Revolving Credit Facility"); and
WHEREAS, pursuant to that certain Amended and Restated Equipment
Facility and Revolving Credit Agreement dated March ___, 1998 (the
"Amended Agreement"), the Bank amended the 1996 Agreement to make
available to the Borrowers, in addition to the amounts outstanding
pursuant to the 1996 Equipment Facility, an equipment purchase
facility in a maximum principal amount of up to $5,000,000 for the
purpose of financing the acquisition of Financed Equipment; and
WHEREAS, pursuant to the Amended Agreement, the Bank further
amended the 1996 Agreement to include Total-Tel International, Total-
Tel Southeast, Total-Tel Services, Total-Tel Florida and Total-Tel
U.K. as Borrowers under both the Equipment Facility and the Revolving
Credit Facility, and to increase the maximum principal amount of the
1996 Revolving Credit Facility to $8,000,000 outstanding at any time;
and
WHEREAS, Summit Bank, as holder of the Loan Documents, wishes to
further modify certain terms and conditions thereof, as hereinafter
set forth; and
WHEREAS, all capitalized terms used herein but not otherwise
defined herein shall have the meanings given to them in the Amended
Agreement.
NOW THEREFORE, in consideration of One Dollar ($1.00) together
with such other valuable consideration, the sufficiency of which is
hereby acknowledged, the parties hereby agree as follows:
1. Negative Covenants.
The parties hereby agree that Article VIII of the Amended
Agreement is hereby modified to add the following:
8.14 Mergers or Acquisitions. Each Borrower agrees that it
shall not permit another Person to acquire all or substantially all
of the capital stock or property of it or any of its Subsidiaries.
2. Counterparts
This Agreement may be executed in one or more counterparts,
each of which shall constitute an original and all of which when
taken together shall constitute one and the same instrument.
3. No Further Amendments
Except as modified herein, all of the terms and provisions
of the Amended Agreement and the other Loan Documents shall remain
unmodified and continue in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first above written.
WITNESS/ATTEST: TOTAL-TEL USA COMMUNICATIONS, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL USA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL CARRIER SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address: Overlook at Great Notch
000 Xxxxx Xxxx
Xxxxxx Xxxxx, XX 00000
Telecopier: 000-000-0000
WITNESS/ATTEST: TOTAL-TEL INTERNATIONAL, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SOUTHEAST, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL SERVICES, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL FLORIDA, INC.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
WITNESS/ATTEST: TOTAL-TEL U.K., LTD.
By:_____________________________ By:_____________________________
Name: Name:
Title: Title:
Address:________________________
________________________
Telecopier:_____________________
SUMMIT BANK
By:_____________________________
Name:
Title:
Address:________________________
________________________
Telecopier:_____________________
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL SERVICES, INC., a New
Jersey corporation (the "Company"), in connection with the
transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of the "Credit Documents" (as such term is
defined in the Agreement) to which the Company is a party, and such
resolution is in full force and effect as of the date hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL FLORIDA, INC., a New
Jersey corporation (the "Company"), in connection with the
transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of the "Credit Documents" (as such term is
defined in the Agreement) to which the Company is a party, and such
resolution is in full force and effect as of the date hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL U.K., LTD., a
corporation organized under the laws of the United Kingdom (the
"Company"), in connection with the transactions contemplated in that
certain Amended and Restated Equipment Facility and Revolving Credit
Agreement (the "Agreement"), dated the date hereof, made by and
among the Company, the other borrowers named therein and SUMMIT
BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of the "Credit Documents" (as such term is
defined in the Agreement) to which the Company is a party, and such
resolution is in full force and effect as of the date hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL SOUTHEAST, INC., a
Georgia corporation (the "Company"), in connection with the
transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of the "Credit Documents" (as such term is
defined in the Agreement) to which the Company is a party, and such
resolution is in full force and effect as of the date hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL USA COMMUNICATIONS,
INC., a New Jersey corporation (the "Company"), in connection with
the transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein, and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of each of the "Credit Documents" (as such
term is defined in the Agreement) to which the Company is a party,
and such resolution is in full force and effect as of the date
hereof.
(d) The following are the duly elected, qualified and acting
officers of the Company who are authorized to act on behalf of the
Company in accordance with the transactions contemplated under the
Agreement and in accordance with the terms of the Resolution, and
that the signatures set forth opposite their respective names below
are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
_________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL, INC., a New Jersey
corporation (the "Company"), in connection with the transactions
contemplated in that certain Amended and Restated Equipment Facility
and Revolving Credit Agreement (the "Agreement"), dated the date
hereof, made by and among the Company, the other borrowers named
therein, and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of each of the "Credit Documents" (as such
term is defined in the Agreement) to which the Company is a party,
and such resolution is in full force and effect as of the date
hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
_____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL USA, INC., a New Jersey
corporation (the "Company"), in connection with the transactions
contemplated in that certain Amended and Restated Equipment Facility
and Revolving Credit Agreement (the "Agreement"), dated the date
hereof, made by and among the Company, the other borrowers named
therein, and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of each of the "Credit Documents" (as such
term is defined in the Agreement) to which the Company is a party,
and such resolution is in full force and effect as of the date
hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
_____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL CARRIER SERVICES, INC.,
a New Jersey corporation (the "Company"), in connection with the
transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein, and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) There has been no change to the [Certificate/Articles]
of Incorporation of the Company since August 23, 1996.
(b) There has been no change to the By-Laws of the Company
since August 23, 1996, and the By-Laws are in full force and effect
as of the date hereof.
(c) Attached hereto as Exhibit A is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of each of the "Credit Documents" (as such
term is defined in the Agreement) to which the Company is a party,
and such resolution is in full force and effect as of the date
hereof.
(d) The following are the duly elected, qualified and acting
officers of the Company who are authorized to act on behalf of the
Company in accordance with the transactions contemplated under the
Agreement and in accordance with the terms of the Resolution, and
that the signatures set forth opposite their respective names below
are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated:
SECRETARY'S CERTIFICATE
The undersigned, Secretary of TOTAL-TEL INTERNATIONAL, INC., a
______________ corporation (the "Company"), in connection with the
transactions contemplated in that certain Amended and Restated
Equipment Facility and Revolving Credit Agreement (the "Agreement"),
dated the date hereof, made by and among the Company, the other
borrowers named therein, and SUMMIT BANK, DOES HEREBY CERTIFY THAT:
(a) Attached hereto as Exhibit A is a true and correct copy
of the [Certificate/Articles] of Incorporation of the Company, as
amended to date.
(b) Attached hereto as Exhibit B is a true and correct copy
of the By-Laws of the Company, as in full force and effect as of the
date hereof.
(c) Attached hereto as Exhibit C is a true and correct copy
of a resolution (the "Resolution") duly adopted by the Board of
Directors of the Company approving and authorizing the execution,
delivery and performance of each of the "Credit Documents" (as such
term is defined in the Agreement) to which the Company is a party,
and such resolution is in full force and effect as of the date
hereof.
(d) The following are the duly elected, qualified and
acting officers of the Company who are authorized to act on behalf
of the Company in accordance with the transactions contemplated
under the Agreement and in accordance with the terms of the
Resolution, and that the signatures set forth opposite their
respective names below are the true signatures of said officers.
Name Office Signature
___________________ _________________ ____________________
___________________ _________________ ____________________
___________________ _________________ ____________________
IN WITNESS WHEREOF, the undersigned has executed this
Certificate and affixed the corporate seal hereto this _____ day of
_____________, 1998.
_______________________________ Name:
Title: Secretary
(SEAL)
I, __________________, __________________________ of the
Company, hereby certify that appearing above is the true and correct
signature of __________________________, Secretary of the Company.
_______________________________
Name:
Title:
Dated: