EXHIBIT 10.15
AMENDED AND RESTATED CREDIT AGREEMENT
BY AND AMONG
XETA TECHNOLOGIES, INC.
FIRSTAR BANK, N.A.
AND
BANK ONE, OKLAHOMA, N.A.
AND
BANK ONE, OKLAHOMA, N.A.
AS AGENT
OCTOBER 31, 2001
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND INTERPRETATION........................................................................2
1.1. Certain Definitions...................................................................................2
1.2. Plural Terms.........................................................................................18
1.3. References to Subsidiaries...........................................................................18
1.4. Accounting...........................................................................................18
1.5. Headings.............................................................................................18
ARTICLE II THE CREDITS..........................................................................................18
2.1. The Credit Facilities................................................................................18
2.1.1. Revolving Credit Facility...................................................................18
2.1.2. Term Loan Facility..........................................................................19
2.1.3. R/E Term Loan Facility......................................................................19
2.1.4 Borrowing Base Limitations..................................................................19
2.2. Purpose; Use of Proceeds.............................................................................19
2.2.1. Revolving Credit Facility...................................................................19
2.2.2. Term Loan Facility..........................................................................20
2.2.3. R/E Term Loan Facility......................................................................20
2.3. Required Principal Payments; Termination.............................................................20
2.3.1. Revolving Credit Facility...................................................................20
2.3.2. Term Loan Facility..........................................................................20
2.3.3. R/E Term Loan Facility......................................................................20
2.3.4. Mandatory Prepayments.......................................................................20
2.4. Types of Advances....................................................................................21
2.5. Commitment Fee; Reductions in Aggregate Commitments..................................................21
2.6. Minimum Amount of Each Advance.......................................................................22
2.7. Optional Principal Payments..........................................................................22
2.8. Method of Selecting Types and Interest Periods for New Advances......................................22
2.9. Conversion and Continuation of Outstanding Advances..................................................22
2.10. Interest; Changes in Interest Rate...................................................................23
2.11. Rates Applicable After Default.......................................................................23
2.12. Method of Payment....................................................................................24
2.13. Noteless Agreement; Evidence of Indebtedness.........................................................24
2.14. Telephonic Notices...................................................................................25
2.15. Interest Payment Dates; Interest and Fee Basis.......................................................25
2.16. Notification of Advances, Interest Rates, Prepayments and Commitment Reductions......................25
2.17. Lending Installations................................................................................25
2.18. Non-Receipt of Funds by the Agent....................................................................26
2.19. Replacement of Lender................................................................................26
2.20. Collateral...........................................................................................27
2.21. Guaranties...........................................................................................27
ARTICLE III YIELD PROTECTION; TAXES..............................................................................27
3.1. Yield Protection.....................................................................................27
3.2. Changes in Capital Adequacy Regulations..............................................................28
3.3. Availability of Types of Advances....................................................................29
3.4. Funding Indemnification..............................................................................29
3.5. Taxes................................................................................................29
3.6. Lender Statements; Survival of Indemnity.............................................................31
ARTICLE IV CONDITIONS PRECEDENT.................................................................................31
4.1. Conditions to Effective Date.........................................................................31
4.1.1. Execution and Delivery of Loan Documents....................................................32
4.1.2. Delivery of Documents.......................................................................32
4.1.3. Headquarters Building.......................................................................33
4.1.4. Other Conditions............................................................................34
4.2. Each Advance.........................................................................................35
4.3 Effect of Borrowing Notice...........................................................................35
ARTICLE V REPRESENTATIONS AND WARRANTIES.......................................................................35
5.1. Existence and Standing...............................................................................35
5.2. Authorization and Validity...........................................................................35
5.3. No Conflict; Government Consent......................................................................36
5.4. Financial Statements.................................................................................36
5.5. Material Adverse Change..............................................................................36
5.6. Taxes................................................................................................36
5.7. Litigation and Contingent Obligations................................................................37
5.8. Subsidiaries.........................................................................................37
5.9. ERISA................................................................................................37
5.10. Accuracy of Information..............................................................................37
5.11. Regulation U.........................................................................................37
5.12. Material Agreements..................................................................................37
5.13. Compliance With Laws.................................................................................38
5.14. Ownership of Properties..............................................................................38
5.15. Plan Assets; Prohibited Transactions.................................................................38
5.16. Environmental Matters................................................................................38
5.17. Investment Company Act...............................................................................38
5.18. Public Utility Holding Company Act...................................................................38
5.19. INTENTIONALLY OMITTED................................................................................38
5.20. Post-Retirement Benefits.............................................................................38
5.21. Insurance............................................................................................39
5.22. Solvency.............................................................................................39
ARTICLE VI COVENANTS............................................................................................39
6.1. Financial Reporting..................................................................................39
6.2. Use of Proceeds......................................................................................41
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6.3. Notice of Default....................................................................................41
6.4. Conduct of Business..................................................................................41
6.5. Taxes................................................................................................41
6.6. Insurance............................................................................................42
6.7. Compliance with Laws.................................................................................42
6.8. Maintenance of Properties............................................................................42
6.9. Inspection...........................................................................................42
6.10. Dividends............................................................................................42
6.11. Indebtedness.........................................................................................42
6.12. Mergers and Acquisitions.............................................................................43
6.12.1. Mergers and Consolidations..................................................................43
6.12.2. Acquisitions................................................................................43
6.13. Sale of Assets.......................................................................................43
6.14. Investments..........................................................................................43
6.15. Liens................................................................................................44
6.16. Capital Expenditures.................................................................................44
6.17. INTENTIONALLY OMITTED................................................................................44
6.18. Affiliates...........................................................................................44
6.19. Operating Leases.....................................................................................45
6.20. Sale and Leaseback Transactions and Other Off-Balance Sheet Liabilities..............................45
6.21. Contingent Obligations...............................................................................45
6.22. Letters of Credit....................................................................................45
6.23. Financial Contracts..................................................................................45
6.24. Financial Covenants..................................................................................45
6.24.1. Current Ratio...............................................................................45
6.24.2. Debt Service Coverage Ratio.................................................................45
6.24.3. Leverage Ratio..............................................................................45
6.24.4. Minimum Net Worth...........................................................................46
6.25 Additional Collateral and Guaranties.................................................................46
6.25.1 Acquisitions................................................................................46
6.25.2. Real Property...............................................................................46
6.26 Operating Accounts...................................................................................47
ARTICLE VII DEFAULTS.............................................................................................47
ARTICLE VIII ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES.......................................................49
8.1. Acceleration.........................................................................................49
8.2. Amendments...........................................................................................49
8.3. Preservation of Rights...............................................................................50
ARTICLE IX GENERAL PROVISIONS...................................................................................50
9.1. Survival of Representations..........................................................................50
9.3. Entire Agreement.....................................................................................50
9.4. Several Obligations; Benefits of this Agreement......................................................51
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9.5. Expenses; Indemnification............................................................................51
9.5.1. Expenses....................................................................................51
9.5.2. Indemnification.............................................................................51
9.5.3 Survival....................................................................................52
9.6. Numbers of Documents.................................................................................52
9.7. Severability of Provisions...........................................................................52
9.8. Nonliability of Lenders..............................................................................52
9.9. Confidentiality......................................................................................52
9.10. Nonreliance..........................................................................................52
9.11. Disclosure...........................................................................................52
ARTICLE X THE AGENT............................................................................................53
10.1. Appointment; Nature of Relationship..................................................................53
10.2. Powers...............................................................................................53
10.3. General Immunity.....................................................................................53
10.4. No Responsibility for Loans, Recitals, etc...........................................................53
10.5. Action on Instructions of Lenders....................................................................54
10.6. Employment of Agents and Counsel.....................................................................54
10.7. Reliance on Documents; Counsel.......................................................................54
10.8. Agent's Reimbursement and Indemnification............................................................54
10.9. Notice of Default....................................................................................55
10.10. Rights as a Lender...................................................................................55
10.11. Lender Credit Decision...............................................................................55
10.12. Successor Agent......................................................................................55
10.13. Agent's Fee..........................................................................................56
10.14. Delegation to Affiliates.............................................................................56
10.15. Collateral Releases..................................................................................56
ARTICLE XI SETOFF; RATABLE PAYMENTS.............................................................................56
11.1. Setoff...............................................................................................56
11.2. Ratable Payments.....................................................................................57
ARTICLE XII BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS....................................................57
12.1. Successors and Assigns...............................................................................57
12.2. Participations.......................................................................................57
12.2.1. Permitted Participants; Effect..............................................................57
12.2.2. Voting Rights...............................................................................58
12.2.3. Benefit of Setoff...........................................................................58
12.3. Assignments..........................................................................................58
12.3.1. Permitted Assignments.......................................................................58
12.3.2. Effect; Effective Date......................................................................59
12.4. Dissemination of Information.........................................................................59
12.5. Tax Treatment........................................................................................59
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ARTICLE XIII NOTICES.................................................................................................59
13.1. Notices..............................................................................................59
13.2. Change of Address....................................................................................60
ARTICLE XIV COUNTERPARTS.............................................................................................60
ARTICLE XV CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL................................................60
15.1. CHOICE OF LAW........................................................................................60
15.2. CONSENT TO JURISDICTION..............................................................................60
15.3. WAIVER OF JURY TRIAL.................................................................................61
Signature Page.........................................................................................................62
EXHIBITS AND SCHEDULES:
Exhibit A - Form of Opinion of Counsel
Exhibit B - Financial Covenant Compliance Certificate
Exhibit C - Borrowing Base Certificate
Exhibit D -
Assignment Agreement
Exhibit E - Loan/Credit Related Money Transfer Instruction
Exhibit F-1 - Revolving Note
Exhibit F-2 - Term Note
Exhibit F-3 - R/E Term Note
Schedule 1 - Subsidiaries and Other Investments
Schedule 2 - Indebtedness and Liens
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AMENDED AND RESTATED CREDIT AGREEMENT
This Amended and Restated Credit Agreement, dated as of October 31,
2001, is among XETA Technologies, Inc., an
Oklahoma corporation, formerly known
as Xeta Corporation (the "Borrower"), the Lenders (as hereinafter defined), and
Bank One,
Oklahoma, NA, a national banking association, as Agent.
RECITALS
A. The parties to this Amended and Restated Credit Agreement are
parties to that certain Credit Agreement dated as of November 30, 1999, as
amended (the "Existing Credit Agreement").
B. Pursuant to the Existing Credit Agreement, the Lenders
established in favor of the Borrower (i) a revolving credit facility in the
maximum principal amount of $8,000,000 (the "Existing Revolving Credit
Facility"), (ii) a term loan facility in the original principal amount of
$23,000,000 (the "Existing Term Loan Facility"), and (iii) an acquisition term
loan facility in the original principal amount of $12,000,000 (the "Existing
Acquisition Term Loan Facility").
C. As of the Effective Date (after giving effect to the principal
payments made on the Effective Date in accordance with the terms of the Existing
Credit Agreement), (i) the principal balance outstanding under the Existing
Revolving Credit Facility is $2,025,000.00, (ii) the principal balance
outstanding under the Existing Term Loan Facility is $14,183,333.36, and (iii)
the principal balance outstanding under the Existing Acquisition Term Loan
Facility is $6,958,353.10.
D. The Borrowers have requested that the Lenders (i) increase the
amount of the Existing Revolving Credit Facility, and (ii) rearrange,
restructure and consolidate the indebtedness outstanding under the Existing Term
Loan Facility and the Existing Acquisition Term Loan Facility. The Lenders have
agreed to such requests, subject to the terms and conditions hereinafter set
forth.
E. The parties desire to make certain other modifications to the
Existing Credit Agreement and to amend and restate the Existing Credit Agreement
in its entirety.
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, and
subject to the terms and conditions set forth herein, the parties hereby amend
and restate the Existing Credit Agreement in its entirety to read as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
1.1. Certain Definitions. As used in this Agreement:
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"Accounts" of a Person means and includes all accounts, accounts
receivable, and other rights to payment of such Person, whether now existing or
hereafter arising.
"Acquisition" means any transaction, or any series of related
transactions, consummated on or after the Effective Date, by which the Borrower
or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation or limited liability
company, or division thereof, whether through purchase of assets, merger or
otherwise or (ii) directly or indirectly acquires (in one transaction or as the
most recent transaction in a series of transactions) at least a majority (in
number of votes) of the securities of a corporation which have ordinary voting
power for the election of directors (other than securities having such power
only by reason of the happening of a contingency) or a majority (by percentage
or voting power) of the outstanding ownership interests of a partnership or
limited liability company.
"Advance" means a borrowing under the Revolving Credit Facility, the
Term Loan Facility or the R/E Term Loan Facility that is (i) made by the Lenders
on the same Borrowing Date, or (ii) converted or continued by the Lenders on the
same date of conversion or continuation, consisting, in either case, of the
aggregate amount of the several Loans of the same Type and, in the case of
Eurodollar Loans, for the same Interest Period.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means Bank One in its capacity as contractual representative of
the Lenders pursuant to Article X, and not in its individual capacity as a
Lender, and any successor Agent appointed pursuant to Article X.
"Aggregate Revolving Credit Commitment" means the aggregate of the
Revolving Credit Commitments of all of the Lenders, as reduced from time to time
pursuant to the terms hereof.
"Aggregate R/E Term Loan Commitment" means, at any time, the aggregate
of the R/E Term Loan Commitments of all of the Lenders.
"Aggregate Term Loan Commitment" means, at any time, the aggregate of
the Term Loan Commitments of all of the Lenders.
"Agreement" means this Credit Agreement, as it may be amended or
modified and in effect from time to time.
"Alternate Base Rate" means, for any day, a rate of interest per annum
equal to the higher of (i) the Corporate Base Rate for such day and (ii) the sum
of the Federal Funds Effective Rate for such day plus 1/2% per annum.
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"Applicable Fee Rate" means, at any time, the percentage rate per annum
at which Commitment Fees are accruing on the unused portion of the Aggregate
Revolving Credit Facility Commitment at such time as set forth in the Pricing
Schedule.
"Applicable Margin" means, with respect to Advances of any Type at any
time outstanding under any Facility, the percentage rate per annum which is
applicable at such time with respect to Advances of such Type and under such
Facility as set forth in the Pricing Schedule.
"Article" means an article of this Agreement unless another document is
specifically referenced.
"Authorized Officer" means each of Xxxx X. Xxxxxx and Xxxxxx X. Xxxxxx,
acting singly.
"Bank One" means Bank One,
Oklahoma, NA, a national banking
association, in its individual capacity, and its successors.
"Borrower" means XETA Technologies, Inc., an
Oklahoma corporation,
formerly known as Xeta Corporation, and its successors and assigns.
"Borrowing Base" means, as of any determination date, the sum of (i)
80% of the Eligible Accounts Balance on such date, plus (ii) 40% of the Eligible
Inventory Balance on such date; provided, however, that at no time shall more
than 25% of the total Borrowing Base be comprised of the amount determined under
clause (ii).
"Borrowing Base Certificate" means a certificate to be completed by the
Borrower and delivered to the Agent, in substantially the form attached hereto
as Exhibit "C."
"Borrowing Date" means a date (including the Effective Date) on which
an Advance is made hereunder.
"Borrowing Notice" is defined in Section 2.8.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of Eurodollar Advances, a day (other than a Saturday or Sunday) on
which banks generally are open in New York and Tulsa for the conduct of
substantially all of their commercial lending activities, interbank wire
transfers can be made on the Fedwire system and dealings in United States
dollars are carried on in the London interbank market and (ii) for all other
purposes, a day (other than a Saturday or Sunday) on which banks generally are
open in Tulsa for the conduct of substantially all of their commercial lending
activities and interbank wire transfers can be made on the Fedwire system.
"Capital Expenditures" means, without duplication, any expenditures for
any purchase or other acquisition of any asset which would be classified as a
fixed or capital asset on a consolidated balance sheet of the Borrower and its
Subsidiaries prepared in accordance with GAAP, excluding (i) the cost of assets
acquired with Capitalized Lease Obligations, (ii)
3
expenditures of insurance proceeds to rebuild or replace any asset after a
casualty loss and (iii) leasehold improvement expenditures for which the
Borrower or a Subsidiary is reimbursed promptly by the lessor.
"Capitalized Lease" of a Person means any lease of Property by such
Person as lessee which would be capitalized on a balance sheet of such Person
prepared in accordance with GAAP.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in conformity with GAAP.
"Cash Equivalent Investments" means (i) short-term obligations of, or
fully guaranteed by, the United States of America, (ii) commercial paper rated
A-1 or better by S&P or P-1 or better by Xxxxx'x, (iii) demand deposit accounts
maintained in the ordinary course of business, and (iv) certificates of deposit
issued by and time deposits with commercial banks (whether domestic or foreign)
having capital and surplus in excess of $100,000,000; provided, in each case
that the same provides for payment of both principal and interest (and not
principal alone or interest alone) and is not subject to any contingency
regarding the payment of principal or interest.
"Change in Control" means (i) the acquisition by any Person, or two or
more Persons acting in concert, of beneficial ownership (within the meaning of
Rule 13d-3 of the SEC under the Securities Exchange Act of 1934) of 35% or more
of the outstanding shares of voting stock of the Borrower, or (ii) the existence
of any circumstance or the occurrence of any event whereby the individuals who
comprise the Incumbent Board shall cease for any reason to constitute at least
two-thirds of the voting members of the Board of Directors of the Borrower. For
purposes of this definition, the "Incumbent Board" means the individuals who are
members of the Board of Directors of the Borrower as of the Effective Date and
any individual who is hereafter elected to the Board of Directors by the
Borrower's common stockholders after his or her nomination for election as a new
director is approved by a vote of at least two-thirds of the Incumbent Board,
provided, however, that no individual shall be considered a member of the
Incumbent Board if such individual initially assumes office as a result of
either an actual or threatened "election contest" (as described in Rule 14A-11
of the SEC promulgated under the Securities Exchange Act of 1934) or other
actual or threatened solicitation of proxies or consents by or on behalf of a
Person other than the Board of Directors, including an individual elected by
reason of any agreement intended to avoid or settle any election contest or
proxy contest.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral Documents" means, collectively, (i) the Security Agreement,
the Mortgage and all other agreements and instruments now or hereafter securing
all or any part of the Obligations, (ii) all UCC-1 financing statements, fixture
filings, lien entry forms and other similar documents from time to time filed or
presented for filing by the Agent in connection with
4
the foregoing, and (iii) all other documents, instruments, agreements and
certificates executed and delivered by the Borrower or any Subsidiary in
connection with the foregoing.
"Commitment" means, for each Lender, such Lender's Revolving Credit
Commitment, Term Loan Commitment and R/E Term Loan Commitment, collectively, and
as the context requires, refers to each of them individually.
"Compliance Certificate" means a certificate to be completed by the
Borrower and delivered to the Agent, in substantially the form attached hereto
as Exhibit "B".
"Consolidated Capital Expenditures" means, with reference to any
period, the Capital Expenditures of the Borrower and its Subsidiaries calculated
on a consolidated basis for such period; provided, however, that for the
calendar years 2001 and 2002, the calculation of Consolidated Capital
Expenditures shall exclude any Capital Expenditures relating to the Oracle
computer systems.
"Consolidated Debt Service Coverage Ratio" means, as of any Quarterly
Calculation Date, the ratio of (i) Consolidated EBIDA for the twelve (12) month
period then ending, minus (A) unfunded Consolidated Capital Expenditures for the
same period and (B) dividends paid or declared during the same period, to (ii)
Consolidated Interest Expense for the twelve (12) month period then ending, plus
current maturities of long-term Consolidated Funded Indebtedness for the
immediately following 12-month period, in each case calculated for the Borrower
and its Subsidiaries on a consolidated basis. For purposes of this definition,
the current maturities of long-term Consolidated Funded Indebtedness shall
exclude the following: (i) the entire principal balance of the Revolving Credit
Facility, and (ii) that portion of the balloon payments falling due at the
maturities of the Term Loan Facility and the R/E Term Loan Facility in excess of
the regularly scheduled monthly installment amounts. In the event that the
Borrower conducts an equity offering and the Required Lenders agree to allow a
portion of the mandatory prepayment resulting therefrom (as provided in Section
2.3.4(b)) to be applied by the Borrower to the next maturing principal
installments due under the Term Loan Facility and the R/E Term Loan Facility,
then for purposes of this definition (i) in determining the Borrower's
compliance with Section 6.24.2, the principal installments so prepaid will not
be included in calculating the current maturities of long-term Consolidated
Funded Indebtedness, but (ii) in determining the Applicable Margin and
Applicable Fee Rate under the Pricing Schedule, the principal installments so
prepaid will nevertheless be included in calculating the current maturities of
long-term Consolidated Funded Indebtedness.
"Consolidated EBIDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) depreciation, (iii) amortization, and (iv) non-cash
writedowns of goodwill in accordance with the applicable accounting standards
under GAAP, all calculated for the Borrower and its Subsidiaries on a
consolidated basis. In calculating Consolidated EBIDA (and any other financial
ratios or determinations which refer to Consolidated EBIDA) following the
closing of any Acquisition which has been approved by the Required Lenders, such
calculation shall be adjusted to take into account the financial impact of such
Acquisition (as if such Acquisition had occurred prior to, and the Subsidiary or
Property acquired pursuant to such Acquisition had been owned
5
by the Borrower throughout, the entire calculation period prior to the date as
of which such calculation is being made), but the manner of making such
adjustment shall be determined by the Lender in its sole discretion using such
methodology as the Lender deems appropriate under the circumstances.
"Consolidated EBITDA" means Consolidated Net Income plus, to the extent
deducted from revenues in determining Consolidated Net Income, (i) Consolidated
Interest Expense, (ii) expense for taxes paid in cash, (iii) depreciation, (iv)
amortization, and (v) non-cash writedowns of goodwill in accordance with the
applicable accounting standards under GAAP, all calculated for the Borrower and
its Subsidiaries on a consolidated basis. In calculating Consolidated EBITDA
(and any other financial ratios or determinations which refer to Consolidated
EBITDA) following the closing of any Acquisition which has been approved by the
Required Lenders, such calculation shall be adjusted to take into account the
financial impact of such Acquisition (as if such Acquisition had occurred prior
to, and the Subsidiary or Property acquired pursuant to such Acquisition had
been owned by the Borrower throughout, the entire calculation period prior to
the date as of which such calculation is being made), but the manner of making
such adjustment shall be determined by the Lender in its sole discretion using
such methodology as the Lender deems appropriate under the circumstances.
"Consolidated Funded Indebtedness" means at any time the aggregate
dollar amount of Consolidated Indebtedness which has actually been funded and is
outstanding at such time, whether or not such amount is due or payable at such
time.
"Consolidated Indebtedness" means at any time the Indebtedness of the
Borrower and its Subsidiaries calculated on a consolidated basis as of such
time.
"Consolidated Interest Expense" means, with reference to any period,
the interest expense of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Income" means, with reference to any period, the net
income (or loss) of the Borrower and its Subsidiaries calculated on a
consolidated basis for such period.
"Consolidated Net Worth" means at any time the consolidated
stockholders' equity of the Borrower and its Subsidiaries calculated on a
consolidated basis as of such time.
"Contingent Obligation" of a Person means any agreement, undertaking or
arrangement by which such Person assumes, guarantees, endorses, contingently
agrees to purchase or provide funds for the payment of, or otherwise becomes or
is contingently liable upon, the obligation or liability of any other Person, or
agrees to maintain the net worth or working capital or other financial condition
of any other Person, or otherwise assures any creditor of such other Person
against loss, including, without limitation, any comfort letter, operating
agreement, take-or-pay contract or the obligations of any such Person as general
partner of a partnership with respect to the liabilities of the partnership.
"Conversion/Continuation Notice" is defined in Section 2.9.
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"Controlled Group" means all members of a controlled group of
corporations or other business entities and all trades or businesses (whether or
not incorporated) under common control which, together with the Borrower or any
of its Subsidiaries, are treated as a single employer under Section 414 of the
Code.
"Corporate Base Rate" means a rate per annum equal to the corporate
base rate or prime rate of interest announced by Bank One or by its parent, Bank
One Corporation, from time to time, changing when and as said corporate base
rate or prime rate changes.
"Default" means an event described in Article VII.
"Effective Date" means the date of this Agreement.
"Eligible Account" means, as of any determination date, any Account (a)
which arose from a bona fide, outright sale of Inventory or from the performance
of services by the Borrower or one of its Subsidiaries, (b) if arising from the
sale of Inventory, as to which the items of Inventory have been shipped for
delivery, (c) which is based upon a valid, enforceable and legally binding order
or contract, (d) which has been billed or invoiced in accordance with the terms
of such order or contract, (e) for which the account debtor is unconditionally
obligated to make payment, and (f) in and to which the Agent has a valid and
perfected first priority security interest. The term shall exclude the
following:
(i) Any Account which is in dispute or as to which
Borrower or the applicable Subsidiary has received notice that the
account debtor claims right of rejection, return, recoupment, setoff,
counterclaim, deduction or defense to payment;
(ii) Any Account which is subject to any assignment,
adverse claim or Lien (other than in favor of the Agent);
(iii) Any Account which is evidenced by, or as to which the
Borrower or the applicable Subsidiary has received, a note, chattel
paper, draft, check, trade acceptance or other instrument in payment
thereof or obtained a judgment with respect thereto;
(iv) Any Account as to which the account debtor is an
Affiliate of the Borrower;
(v) Any Account as to which the account debtor is a
governmental agency or other governmental authority; provided, however,
that up to $250,000 of Accounts payable by governmental agencies and
authorities may be treated as Eligible Accounts;
(vi) Any Account as to which the account debtor has died
or is the subject of dissolution, liquidation, termination of
existence, insolvency, business failure, receivership, bankruptcy,
readjustment of debt, assignment for the benefit of creditors or
similar proceedings;
7
(vii) Any Account which is payable in a currency other
than United States Dollars;
(viii) Any Account which is due from an account debtor
which is located outside the United States or which is incorporated or
organized under the laws of a jurisdiction other than a state of the
United States;
(ix) Any Account which remains unpaid more than 90 days
following the original invoice date;
(x) Any Account which is due and owing from an account
debtor which has an outstanding balance under Accounts which have been
billed and invoiced, if 20% or more of such balance has been
outstanding more than 90 days beyond the original invoice date; and
(xi) Any other Account as to which the Agent has made a
determination, in the reasonable exercise of its discretion, that the
prospects for collection are doubtful.
"Eligible Accounts Balance" means, as of any determination date, the
aggregate unpaid balance (net of interest and finance charges) of all Eligible
Accounts outstanding on such date; provided, however, that the following amounts
shall be subtracted from such calculation as to any individual account debtor
(or group of related account debtors): (i) the amount by which the total balance
due from such account debtor (or group of related account debtors) on Eligible
Accounts exceeds 25% of the aggregate balance due under all Accounts then
outstanding; and (ii) the amount of any accounts payable (contra accounts) then
due and owing by the Borrower or any of its Subsidiaries to such account debtor
(or group of account debtors).
"Eligible Inventory" means, as of any determination date, that portion
of the Inventory of the Borrower and its Subsidiaries consisting of finished
goods and raw materials (a) which is owned by the Borrower and its Subsidiaries
outright, free and clear of any adverse claim or Lien (except in favor of the
Agent), (b) which is in the possession of the Borrower and/or its Subsidiaries
or in the possession of a bailee which has entered into a bailee agreement with
the Agent, in form satisfactory to the Agent, and (c) as to which no Account has
arisen by virtue of sale or other disposition. The term shall exclude the
following:
(i) damaged, obsolete or unmerchantable goods;
(ii) returned goods;
(iii) work in process;
(iv) the spare parts Inventory of the Borrower's lodging
division;
(v) slow-moving items of Inventory (i.e., Inventory not
expected to be sold within one year in the ordinary course of
business);
8
(vi) Inventory held by or warehoused with Avaya; and
(vii) Inventory in the possession of any bailee which has
not entered into a satisfactory bailee letter with the Agent.
"Eligible Inventory Balance" means, as of any determination date, the
aggregate value of all items of Eligible Inventory, determined at the lower of
cost or market on a "first-in, first-out" (FIFO) or average cost basis.
"Environmental Laws" means any and all federal, state, local and
foreign statutes, laws, judicial decisions, regulations, ordinances, rules,
judgments, orders, decrees, plans, injunctions, permits, concessions, grants,
franchises, licenses, agreements and other governmental restrictions relating to
(i) the protection of the environment, (ii) the effect of the environment on
human health, (iii) emissions, discharges or releases of pollutants,
contaminants, hazardous substances or wastes into surface water, ground water or
land, or (iv) the manufacture, processing, distribution, use, treatment,
storage, disposal, transport or handling of pollutants, contaminants, hazardous
substances or wastes or the clean-up or other remediation thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Eurodollar Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Base Rate" means, with respect to a Eurodollar Advance for
the relevant Interest Period, the applicable British Bankers' Association
Interest Settlement Rate for deposits in U.S. dollars appearing on Reuters
Screen FRBD as of 11:00 a.m. (London time) two Business Days prior to the first
day of such Interest Period, and having a maturity equal to such Interest
Period, provided that, (i) if Reuters Screen FRBD is not available to the Agent
for any reason, the applicable Eurodollar Base Rate for the relevant Interest
Period shall instead be the applicable British Bankers' Association Interest
Settlement Rate for deposits in U.S. dollars as reported by any other generally
recognized financial information service as of 11:00 a.m. (London time) two
Business Days prior to the first day of such Interest Period, and having a
maturity equal to such Interest Period, and (ii) if no such British Bankers'
Association Interest Settlement Rate is available to the Agent, the applicable
Eurodollar Base Rate for the relevant Interest Period shall instead be the rate
determined by the Agent to be the rate at which Bank One or one of its Affiliate
banks offers to place deposits in U.S. dollars with first-class banks in the
London interbank market at approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, in the approximate amount
of Bank One's relevant Eurodollar Loan and having a maturity equal to such
Interest Period.
"Eurodollar Loan" means a Loan which, except as otherwise provided in
Section 2.11, bears interest at the applicable Eurodollar Rate.
"Eurodollar Rate" means, with respect to a Eurodollar Advance for the
relevant Interest Period, the sum of (i) the quotient of (a) the Eurodollar Base
Rate applicable to such Interest
9
Period, divided by (b) one minus the Reserve Requirement (expressed as a
decimal) applicable to such Interest Period, plus (ii) the Applicable Margin.
"Excess Cash Flow" means, for any fiscal year of the Borrower, an
amount equal to Consolidated EBITDA for such fiscal year (excluding
extraordinary transactions), less the sum of the following amounts for the same
period: (i) scheduled principal payments on the Loans, (ii) Consolidated
Interest Expenses (to the extent paid in cash), (iii) taxes paid in cash, and
(iv) unfunded Capital Expenditures, in each case determined on a consolidated
basis.
"Excluded Taxes" means, in the case of each Lender or applicable
Lending Installation and the Agent, taxes imposed on its overall net income, and
franchise taxes imposed on it, by (i) the jurisdiction under the laws of which
such Lender or the Agent is incorporated or organized or (ii) the jurisdiction
in which the Agent's or such Lender's principal executive office or such
Lender's applicable Lending Installation is located.
"Exhibit" refers to an exhibit to this Agreement, unless another
document is specifically referenced.
"Facility" means any of the Revolving Credit Facility, the Term Loan
Facility or the R/E Term Loan Facility.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10:00 a.m. (Tulsa
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Fee Letter" means that certain letter agreement dated as of October
27, 1999, by and among the Borrower, the Agent and Banc One Capital Markets,
Inc.
"Financial Contract" of a Person means (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any Rate Management
Transaction.
"Floating Rate" means, for any day, a rate per annum equal to the
Alternate Base Rate for such day plus (ii) the Applicable Margin, in each case
changing when and as the Alternate Base Rate changes.
"Floating Rate Advance" means an Advance which, except as otherwise
provided in Section 2.11, bears interest at the Floating Rate.
"Floating Rate Loan" means a Loan which, except as otherwise provided
in Section 2.11, bears interest at the Floating Rate.
10
"GAAP" means generally accepted accounting principles as in effect from
time to time, applied in a manner consistent with that used in preparing the
financial statements referred to in Section 5.4.
"Guaranty" means the Subsidiary Guaranty dated November 30, 1999,
executed by UST in favor of the Agent for the benefit of the Lenders and the
Agent, as the same may be amended, modified or supplemented from time to time.
"Headquarters Building" means the land and office building constructed
thereon located at 0000 X. Xxxxxx, Xxxxxx Xxxxx, Xxxxxxxx, and used as the
headquarters of the Borrower.
"Indebtedness" of a Person means such Person's (i) obligations for
borrowed money, (ii) obligations representing the deferred purchase price of
Property or services (other than accounts payable arising in the ordinary course
of such Person's business payable on terms customary in the trade), (iii)
obligations, whether or not assumed, secured by Liens or payable out of the
proceeds or production from Property now or hereafter owned or acquired by such
Person, (iv) obligations which are evidenced by notes, acceptances, or other
instruments, (v) obligations of such Person to purchase securities or other
Property arising out of or in connection with the sale of the same or
substantially similar securities or Property, (vi) Capitalized Lease
Obligations, (vii) any other obligation for borrowed money or other financial
accommodation which in accordance with GAAP would be shown as a liability on the
consolidated balance sheet of such Person, and (viii) Off-Balance Sheet
Liabilities.
"Interest Period" means, with respect to a Eurodollar Advance, a period
of one, three or six months commencing on a Business Day selected by the
Borrower pursuant to this Agreement. Such Interest Period shall end on the day
which corresponds numerically to such date one, three or six months thereafter,
provided, however, that if there is no such numerically corresponding day in
such next, third or sixth succeeding month, such Interest Period shall end on
the last Business Day of such next, third or sixth succeeding month. If an
Interest Period would otherwise end on a day which is not a Business Day, such
Interest Period shall end on the next succeeding Business Day, provided,
however, that if said next succeeding Business Day falls in a new calendar
month, such Interest Period shall end on the immediately preceding Business Day.
"Inventory" of a Person means and includes all inventory of such
Person, now existing or hereafter acquired and wherever located, including (i)
raw goods and raw materials, (ii) goods in process, (iii) finished goods, (iv)
materials, supplies, containers, boxes and packaging materials, (v) materials
used or consumed in the course of business, and (vi) all other goods held or
stored for sale or lease or furnished or to be furnished under contracts of
service.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable arising in the ordinary course of business on terms customary in the
trade) or contribution of capital by such Person; stocks, bonds, mutual funds,
partnership interests, notes, debentures or other securities owned by such
Person; any deposit
11
accounts and certificate of deposit owned by such Person; and structured notes,
derivative financial instruments and other similar instruments or contracts
owned by such Person.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement and their respective successors and assigns.
"Lending Installation" means, with respect to a Lender or the Agent,
the office, branch, subsidiary or affiliate of such Lender or the Agent listed
on the signature pages hereof or on a Schedule or otherwise selected by such
Lender or the Agent pursuant to Section 2.17.
"Letter of Credit" of a Person means a letter of credit or similar
instrument which is issued upon the application of such Person or upon which
such Person is an account party or for which such Person is in any way liable.
"Leverage Ratio" means, as of any Quarterly Calculation Date, the ratio
of (i) Consolidated Funded Indebtedness outstanding on such date to (ii)
Consolidated EBITDA for the Borrower's then most-recently ended four fiscal
quarters.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement).
"Loan" means, with respect to a Lender, any loan made by such Lender
pursuant to Article II (or any conversion or continuation thereof). A "Loan" may
be a Revolving Loan, a Term Loan, or an R/E Term Loan.
"Loan Documents" means this Agreement, any Notes issued pursuant to
Section 2.13, the Collateral Documents, the Guaranty, any guaranty agreement
hereafter executed by a Subsidiary in connection herewith, and any other
documents, agreements, instruments and writings executed by the Borrower or any
Subsidiary in connection with this Agreement or the Facilities.
"Loan Value" means, with respect to the Headquarters Building, an
amount equal to 85% of the appraised value of the Headquarters Building, as set
forth in the appraisal delivered pursuant to Section 4.1.3(i) (but only if such
appraised value is accepted by the Agent in the exercise of its sole
discretion).
"Material Adverse Effect" means a material adverse effect on (i) the
business, Property, condition (financial or otherwise), results of operations,
or prospects of the Borrower and its Subsidiaries taken as a whole, (ii) the
ability of the Borrower to perform its obligations under the Loan Documents to
which it is a party, or (iii) the validity or enforceability of any of the Loan
Documents or the rights or remedies of the Agent or the Lenders thereunder.
"Material Indebtedness" is defined in Section 7.5.
12
"Moody's" means Xxxxx'x Investors Service, Inc.
"Mortgage" means the Real Estate Mortgage, Security Agreement,
Assignment of Rents, Financing Statement and Fixture Filing dated November 30,
1999, and covering the Headquarters Building, executed by the Borrower in favor
of the Agent for the benefit of the Lenders and recorded in the real estate
records of the County Clerk of Tulsa County on December 3, 1999, in Book 6301,
at Page 1624, as the same may be amended, modified or supplemented from time to
time.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any
member of the Controlled Group is a party to which more than one employer is
obligated to make contributions.
"Non-U.S. Lender" is defined in Section 3.5(iv).
"Note" means any promissory note issued at the request of a Lender
pursuant to Section 2.13 (whether a Revolving Note, a Term Note or an R/E Term
Note).
"Notice of Assignment" is defined in Section 12.3.2.
"Obligations" means all unpaid principal of and accrued and unpaid
interest on the Loans, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations of the Borrower to the Lenders
or to any Lender, the Agent or any indemnified party arising under the Loan
Documents.
"Off-Balance Sheet Liability" of a Person means (i) any repurchase
obligation or liability of such Person with respect to accounts or notes
receivable sold by such Person, (ii) any liability under any Sale and Leaseback
Transaction which is not a Capitalized Lease, (iii) any liability under any
so-called "synthetic lease" transaction entered into by such Person, or (iv) any
obligation arising with respect to any other transaction which is the functional
equivalent of or takes the place of borrowing but which does not constitute a
liability on the balance sheets of such Person, but excluding from this clause
(iv) Operating Leases.
"Operating Lease" of a Person means any lease of Property (other than a
Capitalized Lease) by such Person as lessee which has an original term
(including any required renewals and any renewals effective at the option of the
lessor) of one year or more.
"Other Taxes" is defined in Section 3.5(ii).
"Participants" is defined in Section 12.2.1.
"Payment Date" means the last day of each calendar month.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
13
"Person" means any natural person, corporation, firm, joint venture,
partnership, limited liability company, association, enterprise, trust or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Pricing Schedule" means the Schedule attached hereto identified as
such.
"Property" of a Person means any and all property, whether real,
personal, tangible, intangible, or mixed, of such Person, or other assets owned,
leased or operated by such Person.
"Pro Rata Share" means, with respect to any Lender at any time, the
percentage obtained by dividing (A) the sum of (i) such Lender's Revolving
Credit Commitment at such time, as adjusted from time to time in accordance with
the provisions of this Agreement (or, in the event the Aggregate Revolving
Credit Commitment has terminated, the sum of such Lender's Revolving Loans
outstanding at such time), plus (ii) such Lender's Term Loan outstanding at such
time, plus (iii) such Lender's R/E Term Loan outstanding at such time, as
adjusted from time to time in accordance with the provisions of this Agreement
by (B) the sum of (i) the Aggregate Revolving Credit Commitment at such time
(or, in the event the Aggregate Revolving Credit Commitment has terminated, the
total of all Revolving Loans outstanding at such time), plus (ii) the aggregate
amount of all Term Loans outstanding at such time, plus (iii) the aggregate
amount of all R/E Term Loans outstanding at such time.
"Purchasers" is defined in Section 12.3.1.
"Quarterly Calculation Date" means the last day of each fiscal quarter
of the Borrower.
"Rate Management Obligations" of a Person means any and all obligations
of such Person, whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (i) any and all Rate
Management Transactions, and (ii) any and all cancellations, buy backs,
reversals, terminations or assignments of any Rate Management Transactions.
"Rate Management Transaction" means any transaction (including an
agreement with respect thereto) now existing or hereafter entered into between
the Borrower and any Lender or Affiliate thereof which is a rate swap, basis
swap, forward rate transaction, commodity swap, commodity option, equity or
equity index swap, equity or equity index option, bond option, interest rate
option, foreign exchange transaction, cap transaction, floor transaction, collar
transaction, forward transaction, currency swap transaction, cross-currency rate
swap transaction, currency option or any other similar transaction (including
any option with respect to any of these transactions) or any combination
thereof, whether linked to one or more interest rates, foreign currencies,
commodity prices, equity prices or other financial measures.
14
"Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor thereto
or other regulation or official interpretation of said Board of Governors
relating to reserve requirements applicable to member banks of the Federal
Reserve System.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Rentals" of a Person means the aggregate fixed amounts payable by such
Person under any Operating Lease.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC has by regulation waived
the requirement of Section 4043(a) of ERISA that it be notified within 30 days
of the occurrence of such event, provided, however, that a failure to meet the
minimum funding standard of Section 412 of the Code and of Section 302 of ERISA
shall be a Reportable Event regardless of the issuance of any such waiver of the
notice requirement in accordance with either Section 4043(a) of ERISA or Section
412(d) of the Code.
"Reports" is defined in Section 9.5.
"Required Lenders" means Lenders whose Pro Rata Shares, in the
aggregate, are greater than 66.67%, except that, in the event there are not more
than two (2) Lenders as of any relevant date, "Required Lenders" means all of
the Lenders.
"Reserve Requirement" means, with respect to an Interest Period, the
maximum aggregate reserve requirement (including all basic, supplemental,
marginal and other reserves) which is imposed under Regulation D on Eurocurrency
liabilities.
"Revolving Credit Commitment" means, for each Lender, the obligation of
such Lender to make Revolving Loans to the Borrower in an amount not exceeding
the amount set forth opposite such Lender's name on the signature pages hereto
directly underneath the caption "Revolving Loan Commitment" or as set forth in
any Notice of Assignment relating to any assignment that has become effective
pursuant to Section 12.3.2, as such amount may be modified from time to time
pursuant to the terms hereof.
"Revolving Credit Facility" means the revolving credit facility
continued and increased by the Lenders pursuant to Section 2.1.1.
"Revolving Credit Facility Termination Date" means October 31, 2002, or
any earlier date on which the Aggregate Revolving Credit Commitment is reduced
to zero or otherwise terminated pursuant to the terms hereof.
15
"Revolving Loan" means, with respect to a Lender, any loan made by such
Lender pursuant to Section 2.1.1 (or any continuation or conversion thereof).
"Revolving Note" means a promissory note issued at the request of a
Lender pursuant to Section 2.13, substantially in the form of Exhibit "F-1".
"R/E Term Loan" means, with respect to a Lender, the loan made by such
Lender pursuant to Section 2.1.3 (and any conversion or continuation thereof).
"R/E Term Loan Commitment" means, for each Lender, the amount set forth
opposite such Lender's name in the signature pages hereto directly underneath
the caption "R/E Term Loan Commitment, but in any event not more than such
Lender's Pro Rata Share of the Loan Value of the Headquarters Building.
"R/E Term Loan Facility" means the term loan facility established by
the Lenders pursuant to Section 2.1.3.
"R/E Term Note" means a promissory note issued at the request of a
Lender pursuant to Section 2.13, substantially in the form of Exhibit "F-3".
"S&P" means Standard and Poor's Ratings Services, a division of The
McGraw Hill Companies, Inc.
"SEC" means the Securities and Exchange Commission of the United States
of America, or any successor agency to its functions.
"Sale and Leaseback Transaction" means any sale or other transfer of
Property by any Person with the intent to lease such Property as lessee.
"Schedule" refers to a specific schedule to this Agreement, unless
another document is specifically referenced.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Secured Obligations" means, collectively, (i) the Obligations and (ii)
all Rate Management Obligations owing to one or more Lenders.
"Security Agreement" means Pledge and Security Agreement dated November
30, 1999, executed by the Borrower and UST (and to be executed by each
Subsidiary hereafter formed or acquired by the Borrower) in favor of the Agent
for the benefit of the Lenders, as the same may be amended, modified or
supplemented from time to time.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
16
"Subsidiary" of a Person means (i) any corporation more than 50% of the
outstanding securities having ordinary voting power of which shall at the time
be owned or controlled, directly or indirectly, by such Person or by one or more
of its Subsidiaries or by such Person and one or more of its Subsidiaries, or
(ii) any partnership, limited liability company, association, joint venture or
similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
Unless otherwise expressly provided, all references herein to a "Subsidiary"
shall mean a Subsidiary of the Borrower.
"Substantial Portion" means, with respect to the Property of the
Borrower and its Subsidiaries, Property which (i) represents more than 10% of
the consolidated assets of the Borrower and its Subsidiaries as would be shown
in the consolidated financial statements of the Borrower and its Subsidiaries as
at the beginning of the twelve-month period ending with the month in which such
determination is made, or (ii) is responsible for more than 10% of the
consolidated net sales or of the consolidated net income of the Borrower and its
Subsidiaries as reflected in the financial statements referred to in clause (i)
above.
"Taxes" means any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and any and all liabilities with
respect to the foregoing, but excluding Excluded Taxes and Other Taxes.
"Term Loan" means, with respect to a Lender, the loan made by such
Lender pursuant to Section 2.1.2 (and any conversion or continuation thereof).
"Term Loan Commitment" means, for each Lender, the amount set forth
opposite such Lender's name in the signature pages hereto directly underneath
the caption "Term Loan Commitment."
"Term Loan Facility" means the term loan facility established by the
Lenders pursuant to Section 2.1.2.
"Term Note" means a promissory note issued at the request of a Lender
pursuant to Section 2.13, substantially in the form of Exhibit "F-2".
"Transferee" is defined in Section 12.4.
"Type" means, with respect to any Advance, its nature as a Floating
Rate Advance or a Eurodollar Advance.
"UST" means U. S. Technologies Systems, Inc., a Missouri corporation.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested and unvested accrued benefits under all Single Employer
Plans exceeds the fair market value of all such Plan assets allocable to such
benefits, all determined as of the then most recent valuation date for such
Plans using PBGC actuarial assumptions for single employer plan terminations.
17
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or by such Person and one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, limited liability company,
association, joint venture or similar business organization 100% of the
ownership interests having ordinary voting power of which shall at the time be
so owned or controlled.
1.2. Plural Terms. The definitions set forth in Section 1.2 shall
be equally applicable to both the singular and plural forms of the defined
terms.
1.3. References to Subsidiaries. Reference in this Agreement to
Subsidiaries of the Borrower shall be applicable only during such periods of
time that the Borrower (with the consent of the Required Lenders) has one or
more Subsidiaries. Notwithstanding any references contained herein to
Subsidiaries formed or acquired by the Borrower after the Effective Date, no
such Subsidiary shall be formed or acquired except upon the prior consent of the
Required Lenders (as required under Sections 6.12.2 and 6.14).
1.4. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP. References
herein to the "consolidated" financial statements of the Borrower and to
accounting or financial determinations which are to be made hereunder on a
"consolidated" basis shall apply only during such periods of time that the
Borrower (with the consent of the Required Lenders) has one or more consolidated
Subsidiaries.
1.5. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any of
the provisions of the Loan Documents.
ARTICLE II
THE CREDITS
2.1. The Credit Facilities.
2.1.1. Revolving Credit Facility. From and including the
Effective Date and prior to the Revolving Credit Facility Termination Date, each
Lender severally agrees, on the terms and conditions set forth in this
Agreement, to make revolving loans to the Borrower from time to time (each
individually a "Revolving Loan" and, collectively, the "Revolving Loans") in
amounts not to exceed in the aggregate at any one time outstanding the lesser of
(i) the amount of its Revolving Credit Commitment or (ii) its Pro Rata Share of
the Borrowing Base in effect at such time. Each Advance made under the Revolving
Credit Facility shall consist of Revolving Loans made by the Lenders ratably in
proportion to each Lender's Pro Rata Share of the Aggregate Revolving Credit
Commitment, and at no time shall the aggregate principal amount of all Revolving
Loans outstanding hereunder exceed the lesser of (i) the Aggregate Revolving
Credit
18
Commitment or (ii) the Borrowing Base in effect at such time. No Lender shall be
responsible for any failure by any other Lender to perform its obligation to
make any Revolving Loan hereunder nor shall the Revolving Credit Commitment of
any Lender be increased or decreased as a result of any such failure. Subject to
the terms of this Agreement, the Borrower may borrow, repay and reborrow
Revolving Loans at any time prior to the Revolving Credit Facility Termination
Date. The Revolving Credit Commitments of the Lenders shall expire on the
Revolving Credit Facility Termination Date.
2.1.2. Term Loan Facility. On the Effective Date, each
Lender severally agrees, on the terms and conditions set forth in this
Agreement, to make a term loan to the Borrowers in an amount equal to the amount
of its Term Loan Commitment (each individually a "Term Loan" and collectively,
the "Term Loans"). No Lender shall be responsible for any failure by any other
Lender to perform its obligation to make any Term Loan hereunder nor shall the
Term Loan Commitment of any Lender be increased or decreased as a result of such
failure. No portion of any Term Loan shall be reborrowed once it is repaid.
2.1.3. R/E Term Loan Facility. On the Effective Date, each
Lender severally agrees, on the terms and conditions set forth in this
Agreement, to make a term loan to the Borrowers in an amount equal to the amount
of its R/E Term Loan Commitment (each individually a "R/E Term Loan" and
collectively, the "R/E Term Loans"). No Lender shall be responsible for any
failure by any other Lender to perform its obligation to make any R/E Term Loan
hereunder nor shall the R/E Term Loan Commitment of any Lender be increased or
decreased as a result of such failure. No portion of any R/E Term Loan shall be
reborrowed once it is repaid.
2.1.4 Borrowing Base Limitations. On or before the
Effective Date, the Agent will calculate the initial Borrowing Base (to be in
effect from the Effective Date until the first redetermination of the Borrowing
Base) based on the calculations set forth in the Borrowing Base Certificate to
be delivered pursuant to Section 4.1.2(ix). Within 15 days after the Borrower
delivers each Borrowing Base Certificate and at such other times as the Agent in
its sole discretion may select, the Agent shall recalculate the Borrowing Base
(taking into account the calculations set forth in the applicable Borrowing Base
Certificate, but without being bound thereby) and notify the Borrower of the
revised Borrowing Base. Each revised Borrowing Base shall remain in effect until
the Agent notifies the Borrower of a change in the Borrowing Base. At no time
will the Lenders be required to make any requested Advance under the Revolving
Credit Facility if the aggregate principal balance of all Revolving Loans then
outstanding exceeds the Borrowing Base then in effect or if the making of such
Advance would cause the aggregate principal balance outstanding under the
Revolving Credit Facility to exceed the Borrowing Base then in effect.
2.2. Purpose; Use of Proceeds.
2.2.1. Revolving Credit Facility. The initial Advance made
under the Revolving Credit Facility will be used (i) to continue the
Indebtedness outstanding under the Existing Revolving Credit Facility as of the
Effective Date, (ii) to renew, rearrange and refinance $3,000,000 of the
Indebtedness outstanding under the Existing Acquisition Loan Facility as of
19
the Effective Date, and (iii) to repay a $1,000,000 subordinated note of the
Borrower. Proceeds of each Advance made under the Revolving Credit Facility
after the Effective Date shall be used by the Borrower for general corporate
working capital purposes and to finance Capital Expenditures.
2.2.2. Term Loan Facility. The Term Loans will be made in
consolidation, continuation and rearrangement of the Indebtedness outstanding
under the Existing Term Loan Facility and the Existing Acquisition Term Loan
Facility as of the Effective Date, other than the portions of such Indebtedness
to be refinanced under the Revolving Credit Facility and the R/E Term Loan
Facility.
2.2.3. R/E Term Loan Facility. The R/E Term Loans will be
made in continuation, rearrangement and refinancing of $2,550,000 of the
Indebtedness outstanding under the Existing Acquisition Term Loan Facility as of
the Effective Date.
2.3. Required Principal Payments; Termination.
2.3.1. Revolving Credit Facility. All outstanding Revolving
Loans and all other unpaid Obligations arising under or relating to the
Revolving Credit Facility shall be due and payable in full on the Revolving
Credit Facility Termination Date.
2.3.2. Term Loan Facility. The Term Loans shall be payable
as to principal in twenty-four (24) consecutive monthly payments, which shall be
due on each Payment Date commencing November 30, 2001, and continuing on the
last day of each calendar month thereafter to and including October 31, 2003,
with each installment (except the final installment due at maturity) to be in
the aggregate principal amount of $259,861.44 and with the final installment due
at maturity to be equal to the then outstanding principal balance of the Term
Loans and all other unpaid Obligations arising under or relating to the Term
Loan Facility.
2.3.3. R/E Term Loan Facility. The R/E Term Loans shall be
payable as to principal in twenty-four (24) consecutive monthly payments, which
shall be due on each Payment Date commencing November 30, 2001, and continuing
on the last day of each calendar month thereafter to and including October 31,
2003, with each installment (except the final installment due at maturity) to be
in the aggregate principal amount of $14,166.66 and with the final installment
due at maturity to be equal to the then outstanding principal balance of the R/E
Term Loans and all other unpaid Obligations arising under or relating to the R/E
Term Loan Facility.
2.3.4. Mandatory Prepayments.
(a) If the aggregate principal balance of all Revolving
Loans at any time outstanding exceeds the Borrowing Base then in effect, the
Borrower shall make an immediate mandatory prepayment of principal on the
Revolving Loans sufficient to reduce the aggregate principal balance of the
Revolving Loans to not more than the Borrowing Base then in effect.
20
(b) Within three (3) Business Days after receipt thereof,
the Borrower shall make a mandatory prepayment on the Loans in an amount equal
to the net proceeds received by the Borrower from (i) the sale of a Substantial
Portion of its Properties, (ii) the creation or incurrence of additional
Indebtedness (other than Loans and additional Indebtedness permitted under
Section 6.11), or (iii) the sale or issuance of any equity securities (but in
the case of any sale or issuance of equity securities, prepayment shall be
required only to the extent that the net proceeds thereof are less than or equal
to the aggregate principal amount of all outstanding Term Loans and R/E Term
Loans). Any mandatory prepayment made pursuant to clause (i) or (ii) preceding
shall be applied as follows (to the extent of available proceeds): first, to the
principal installments payable under Section 2.3.2 with respect to the Term
Loans in the inverse order of maturity; then, to the principal installments
payable under Section 2.3.3 with respect to the R/E Term Loans in the inverse
order of maturity; and finally, to any outstanding Revolving Loans. Any
mandatory prepayment made pursuant to clause (iii) preceding shall be applied as
follows (to the extent of available proceeds): first, to the principal
installments payable under Section 2.3.2 with respect to the Term Loans in the
inverse order of maturity; and then, to the principal installments payable under
Section 2.3.3 with respect to the R/E Term Loans in the inverse order of
maturity. Upon request of the Borrower, the Required Lenders agree to consider
and negotiate terms under which some portion of any mandatory prepayment made
pursuant to clause (iii) preceding would be applied to the next maturing
principal installments payable under Sections 2.3.2 and 2.3.3 with respect to
the Term Loans and/or the R/E Term Loans (as opposed to the order of application
specified in the preceding sentence), provided, however, that any decision made
by the Required Lenders with respect to any such request shall be final and
conclusive. To the extent any mandatory prepayment is applied to the outstanding
Revolving Loans, the Aggregate Revolving Credit Commitment shall be permanently
reduced by a like amount. Nothing contained in this Section 2.3.4 shall nullify
the requirements, as set forth in Section 6.11 and 6.13, respectively, for
consent of the Required Lenders to any sale by the Borrower of a Substantial
Portion of its Properties or the creation or incurrence of additional
Indebtedness.
(c) Within three (3) Business Days after each delivery of
the annual financial statements required to be delivered under Sections 6.1(i),
the Borrower shall make a mandatory prepayment on the Term Loans in an amount
equal to (i) 75% of Excess Cash Flow for the preceding fiscal year, if the
Leverage Ratio at the end of such fiscal year was greater than 2.50 to 1.0, or
(ii) 50% of Excess Cash Flow for the preceding fiscal year, if the Leverage
Ratio at the end of such fiscal year was less than or equal to 2.50 to 1.0. Any
mandatory prepayment made pursuant to this subparagraph shall be applied to the
principal installments payable under Section 2.3.2 with respect to the Term
Loans in the inverse order of maturity.
2.4. Types of Advances. The Advances under the Revolving Credit
Facility, the Term Loan Facility and the R/E Term Loan Facility may be Floating
Rate Advances or Eurodollar Advances, or a combination thereof, selected by the
Borrowers in accordance with Sections 2.8 and 2.9. Not more than three (3)
Eurodollar Advances may be outstanding at any time under any Facility.
2.5. Commitment Fee; Reductions in Aggregate Commitments. The
Borrower agrees to pay to the Agent for the account of each Lender a commitment
fee at a per annum rate equal to the Applicable Fee Rate on the daily unused
portion of such Lender's Revolving Credit
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Commitment from the date hereof to and including the Revolving Credit Facility
Termination Date, payable on each Payment Date hereafter and on the Revolving
Credit Facility Termination Date. The Borrower may permanently reduce the
Aggregate Revolving Credit Commitment, in whole or in part ratably among the
Lenders, in integral multiples of $1,000,000, upon at least three Business Days'
written notice to the Agent, which notice shall specify the amount of any such
reduction, provided, however, that the amount of the Aggregate Revolving Credit
Commitment may not be reduced below the aggregate principal amount of the
Advances outstanding under the Revolving Credit Facility, as applicable. All
accrued commitment fees shall be payable on the effective date of any
termination of the obligations of the Lenders to make Revolving Loans hereunder.
2.6. Minimum Amount of Each Advance. Each Eurodollar Advance shall
be in the minimum amount of $500,000 (and in multiples of $250,000 if in excess
thereof), and each Floating Rate Advance shall be in the minimum amount of
$250,000 (and in multiples of $100,000 if in excess thereof), provided, however,
that any Floating Rate Advance under the Revolving Credit Facility may be in the
amount of the unused Aggregate Revolving Credit Commitment.
2.7. Optional Principal Payments. The Borrower may from time to
time pay, without penalty or premium, all outstanding Floating Rate Advances,
or, in a minimum aggregate amount of $250,000 or any integral multiple of
$100,000 in excess thereof, any portion of the outstanding Floating Rate
Advances upon one Business Days' prior notice to the Agent. The Borrower may
pay, without premium or penalty, any Eurodollar Advance at the end of the
applicable Interest Period, but no Eurodollar Advance may be pre-paid prior to
the end of the applicable Interest Period. Principal prepayments made on the
Term Loans or the R/E Term Loans shall be applied to the principal installments
payable under Section 2.3.2 or 2.3.3, as applicable, in the inverse order of
maturity.
2.8. Method of Selecting Types and Interest Periods for New
Advances. The Borrower shall select the Type of Advance and, in the case of each
Eurodollar Advance, the Interest Period applicable thereto from time to time.
The Borrower shall give the Agent irrevocable notice (a "Borrowing Notice") not
later than 10:00 a.m. (Tulsa time) at least one Business Day before the
Borrowing Date of each Floating Rate Advance and three Business Days before the
Borrowing Date for each Eurodollar Advance, specifying:
(i) the Borrowing Date, which shall be a Business Day, of such
Advance,
(ii) the aggregate amount of such Advance,
(iii) the Type of Advance selected, and
(iv) in the case of each Eurodollar Advance, the Interest Period
applicable thereto.
Not later than noon (Tulsa time) on each Borrowing Date, each Lender shall make
available its Loan or Loans in funds immediately available in Tulsa to the Agent
at its address specified
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pursuant to Article XIII. The Agent will make the funds so received from the
Lenders available to the Borrower at the Agent's aforesaid address.
2.9. Conversion and Continuation of Outstanding Advances. Floating
Rate Advances shall continue as Floating Rate Advances unless and until such
Floating Rate Advances are converted into Eurodollar Advances pursuant to this
Section 2.9 or are repaid in accordance with Section 2.3 or 2.7. Each Eurodollar
Advance shall continue as a Eurodollar Advance until the end of the then
applicable Interest Period therefor, at which time such Eurodollar Advance shall
be automatically converted into a Floating Rate Advance unless the Borrower
shall have given the Agent a Conversion/Continuation Notice (as defined below)
requesting that, at the end of such Interest Period, such Eurodollar Advance
continue as a Eurodollar Advance for the same or another Interest Period or
unless such Eurodollar Advance is repaid in accordance with Section 2.3. Subject
to the terms of Section 2.6, the Borrower may elect from time to time to convert
all or any part of a Floating Rate Advance into a Eurodollar Advance. The
Borrower shall give the Agent irrevocable notice (a "Conversion/Continuation
Notice") of each conversion of a Floating Rate Advance into a Eurodollar Advance
or continuation of a Eurodollar Advance not later than 10:00 a.m. (Tulsa time)
at least three Business Days prior to the date of the requested conversion or
continuation, specifying:
(i) the requested date, which shall be a Business Day, of such
conversion or continuation,
(ii) the aggregate amount and Type of the Advance which is to be
converted or continued, and
(iii) the amount of such Advance which is to be converted into or
continued as a Eurodollar Advance and the duration of the
Interest Period applicable thereto.
2.10. Interest; Changes in Interest Rate. Each Floating Rate Advance
shall bear interest on the outstanding principal amount thereof, for each day
from and including the date such Advance is made or is automatically converted
from a Eurodollar Advance into a Floating Rate Advance pursuant to Section 2.9,
to but excluding the date it is paid or is converted into a Eurodollar Advance
pursuant to Section 2.9 hereof, at a rate per annum equal to the Floating Rate
for such day. Changes in the rate of interest on that portion of any Advance
maintained as a Floating Rate Advance will take effect simultaneously with each
change in the Alternate Base Rate. Each Eurodollar Advance shall bear interest
on the outstanding principal amount thereof from and including the first day of
the Interest Period applicable thereto to (but not including) the last day of
such Interest Period at the interest rate determined by the Agent as applicable
to such Eurodollar Advance based upon the Borrower's selections under Sections
2.8 and 2.9 and otherwise in accordance with the terms hereof. No Interest
Period with respect to any Advance under any Facility may end after the maturity
or termination of such Facility. The Borrower shall select Interest Periods so
that it is not necessary to repay any portion of a Eurodollar Advance prior to
the last day of the applicable Interest Period in order to make a payment
(including a mandatory prepayment) required pursuant to Section 2.3.
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2.11. Rates Applicable After Default. Notwithstanding anything to
the contrary contained in Section 2.8 or 2.9, during the continuance of a
Default or Unmatured Default the Required Lenders may, at their option, by
notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that no
Advance may be made as, converted into or continued as a Eurodollar Advance.
During the continuation of a Default, the Required Lenders may, at their option,
by notice to the Borrower (which notice may be revoked at the option of the
Required Lenders notwithstanding any provision of Section 8.2 requiring
unanimous consent of the Lenders to changes in interest rates), declare that (i)
each Eurodollar Advance shall bear interest for the remainder of the applicable
Interest Period at the rate otherwise applicable to such Interest Period plus 2%
per annum and (ii) each Floating Rate Advance shall bear interest at a rate per
annum equal to the Floating Rate in effect from time to time plus 2% per annum,
provided that, during the continuance of a Default under Section 7.6 or 7.7, the
interest rates set forth in clauses (i) and (ii) above shall be applicable to
all Advances without any election or action on the part of the Agent or any
Lender.
2.12. Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's address specified pursuant to
Article XIII, or at any other Lending Installation of the Agent specified in
writing by the Agent to the Borrower, by noon (local time) on the date when due
and shall be applied ratably by the Agent among the Lenders. Each payment
delivered to the Agent for the account of any Lender shall be delivered promptly
by the Agent to such Lender in the same type of funds that the Agent received at
its address specified pursuant to Article XIII or at any Lending Installation
specified in a notice received by the Agent from such Lender. The Agent is
hereby authorized to charge the account of the Borrower maintained with Bank One
for each payment of principal, interest and fees as it becomes due hereunder.
2.13. Noteless Agreement; Evidence of Indebtedness.
(i) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of
the Borrower to such Lender resulting from each Loan made by
such Lender from time to time, including the amounts of
principal and interest payable and paid to such Lender from
time to time hereunder.
(ii) The Agent shall also maintain accounts in which it will record
(a) the amount of each Loan made hereunder, the Type thereof
and the Interest Period with respect thereto, (b) the amount
of any principal or interest due and payable or to become due
and payable from the Borrower to each Lender hereunder and (c)
the amount of any sum received by the Agent hereunder from the
Borrower and each Lender's share thereof.
(iii) The entries maintained in the accounts maintained pursuant to
paragraphs (i) and (ii) shall be prima facie evidence of the
existence and amounts of the Obligations therein recorded;
provided, however, that the failure of the Agent or any Lender
to maintain such accounts or any error therein shall not in
any manner affect the
24
obligation of the Borrower to repay the Obligations in
accordance with their terms.
(iv) Any Lender may request that its Loans be evidenced by one or
more promissory notes (each, a "Note"). In such event, the
Borrower shall prepare, execute and deliver to such Lender one
or more Notes payable to the order of such Lender in a form
supplied by the Agent. Thereafter, the Loans evidenced by such
Notes and interest thereon shall at all times (including after
any assignment pursuant to Section 12.3) be represented by one
or more Notes payable to the order of the payee named therein
or any assignee pursuant to Section 12.3, except to the extent
that any such Lender or assignee subsequently returns any such
Notes for cancellation and requests that such Loans once again
be evidenced as described in paragraphs (i) and (ii) above.
2.14. Telephonic Notices. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Types of Advances and to transfer funds based on telephonic notices made by any
person or persons the Agent or any Lender in good faith believes to be acting on
behalf of the Borrower, it being understood that the foregoing authorization is
specifically intended to allow Borrowing Notices and Conversion/Continuation
Notices to be given telephonically. The Borrower agrees to deliver promptly to
the Agent a written confirmation, if such confirmation is requested by the Agent
or any Lender, of each telephonic notice signed by an Authorized Officer. If the
written confirmation differs in any material respect from the action taken by
the Agent and the Lenders, the records of the Agent and the Lenders shall govern
absent manifest error.
2.15. Interest Payment Dates; Interest and Fee Basis. Interest
accrued on each Floating Rate Advance shall be payable on each Payment Date,
commencing with the first such date to occur after the date hereof and at
maturity. Interest accrued on that portion of the outstanding principal amount
of any Floating Rate Advance converted into a Eurodollar Advance on a day other
than a Payment Date shall be payable on the date of conversion. Interest accrued
on each Eurodollar Advance shall be payable on the last day of its applicable
Interest Period, on any date on which the Eurodollar Advance is prepaid, whether
by mandatory prepayment, upon acceleration or otherwise, and at maturity.
Interest accrued on each Eurodollar Advance having an Interest Period longer
than three months shall also be payable on the last day of each three-month
interval during such Interest Period. Interest and commitment fees shall be
calculated for actual days elapsed on the basis of a 360-day year. Interest
shall be payable for the day an Advance is made but not for the day of any
payment on the amount paid if payment is received prior to noon (local time) at
the place of payment. If any payment of principal of or interest on an Advance
shall become due on a day which is not a Business Day, such payment shall be
made on the next succeeding Business Day and, in the case of a principal
payment, such extension of time shall be included in computing interest in
connection with such payment.
2.16. Notification of Advances, Interest Rates, Prepayments and
Commitment Reductions. Promptly after receipt thereof, the Agent will notify
each Lender of the contents of each reduction notice with respect to the
Aggregate Revolving Credit Commitment, Borrowing Notice, Conversion/Continuation
Notice and repayment notice received by it hereunder. The
25
Agent will notify each Lender of the interest rate applicable to each Eurodollar
Advance promptly upon determination of such interest rate and will give each
Lender prompt notice of each change in the Alternate Base Rate.
2.17. Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Loans and any Notes issued hereunder shall be
deemed held by each Lender for the benefit of any such Lending Installation.
Each Lender may, by written notice to the Agent and the Borrower in accordance
with Article XIII, designate replacement or additional Lending Installations
through which Loans will be made by it and for whose account Loan payments are
to be made.
2.18. Non-Receipt of Funds by the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (i) in the case of a Lender, the
proceeds of a Loan or (ii) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
such Lender or the Borrower, as the case may be, has not in fact made such
payment to the Agent, the recipient of such payment shall, on demand by the
Agent, repay to the Agent the amount so made available together with interest
thereon in respect of each day during the period commencing on the date such
amount was so made available by the Agent until the date the Agent recovers such
amount at a rate per annum equal to (x) in the case of payment by a Lender, the
Federal Funds Effective Rate for such day for the first three days and,
thereafter, the interest rate applicable to the relevant Loan or (y) in the case
of payment by the Borrower, the interest rate applicable to the relevant Loan.
2.19. Replacement of Lender. If the Borrower is required pursuant to
Section 3.1, 3.2 or 3.5 to make any additional payment to any Lender or if any
Lender's obligation to make or continue, or to convert Floating Rate Advances
into, Eurodollar Advances shall be suspended pursuant to Section 3.3 (any Lender
so affected, an "Affected Lender"), the Borrower may elect, if such amounts
continue to be charged or such suspension is still effective, to replace such
Affected Lender as a Lender party to this Agreement, provided that no Default or
Unmatured Default shall have occurred and be continuing at the time of such
replacement, and provided further that, concurrently with such replacement, (i)
another bank or other entity which is reasonably satisfactory to the Borrower
and the Agent shall agree, as of such date, to purchase for cash the Advances
and other Obligations due to the Affected Lender pursuant to an assignment
substantially in the form of Exhibit "D" and to become a Lender for all purposes
under this Agreement and to assume all obligations of the Affected Lender to be
terminated as of such date and to comply with the requirements of Section 12.3
applicable to assignments, and (ii) the Borrower shall pay to such Affected
Lender in same day funds on the day of such replacement (A) all interest, fees
and other amounts then accrued but unpaid to such Affected Lender by the
Borrower hereunder to and including the date of termination, including without
limitation payments due to such Affected Lender under Sections 3.1, 3.2 and 3.5,
and (B) an amount, if any, equal to the payment which would have been due to
such Lender on the day of
26
such replacement under Section 3.4 had the Loans of such Affected Lender been
prepaid on such date rather than sold to the replacement Lender.
2.20. Collateral. To secure the Obligations, the Borrower shall
grant and convey in favor of the Agent, and shall cause UST and each Subsidiary
hereafter formed or acquired by the Borrower to grant and convey in favor of the
Agent, and further, shall maintain and cause to be maintained in favor of the
Agent at all times during the term of this Agreement and until the Obligations
are paid and satisfied in full, valid and perfected first priority security
interests and mortgage liens in all of the now existing and after-acquired
tangible and intangible Property of the Borrower and each of its Subsidiaries,
whether real, personal or mixed, subject only to Permitted Liens, including,
without limitation, all accounts, inventory, equipment, fixtures (including
trade fixtures), real estate, buildings and improvements (including the
Headquarters Building), leaseholds, general intangibles, patents, trademarks,
trade names, franchises, investment property (including all shares of capital
stock or other equity securities of each of the Borrower's Subsidiaries) and
deposit accounts of the Borrower and each of its Subsidiaries, and all proceeds
of any thereof. In order to provide the Agent with such first priority perfected
security interests and mortgage liens, the Borrower has heretofore executed and
delivered the Mortgage and the Security Agreement, and caused UST to execute and
deliver the Security Agreement, to the Agent, both of which shall continue in
full force and effect from and after the Effective Date, and from time to time,
the Borrower will execute and deliver, or cause to be executed and delivered,
such instruments, agreements, assignments, financing statements and other
documents, and take or cause to be taken such actions as may be necessary in the
opinion of the Agent and the Agent's counsel to provide such valid and perfected
first priority security interests and mortgage liens, including, without
limitation, the Collateral Documents.
2.21. Guaranties. The Borrower shall cause UST and each Subsidiary
hereafter formed or acquired by the Borrower to guarantee to the Lenders and the
Agent the prompt payment and performance of the Obligations and to maintain such
guarantees in full force and effect at all times during the term of this
Agreement and until the Obligations are paid and satisfied in full. In order to
provide the Lenders and the Agent with such guarantees, the Borrower caused UST
to execute and deliver the Guaranty and shall cause each Subsidiary hereafter
formed or acquired by the Borrower to execute and deliver a guaranty in the same
form and containing substantially the same terms as the Guaranty.
ARTICLE III
YIELD PROTECTION; TAXES
3.1. Yield Protection. If, on or after the Effective Date, the
adoption of any law or any governmental or quasi-governmental rule, regulation,
policy, guideline or directive (whether or not having the force of law), or any
change in the interpretation or administration thereof by any governmental or
quasi-governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or
applicable Lending Installation with any request or directive (whether or not
having the force of law) of any such authority, central bank or comparable
agency:
27
(i) subjects any Lender or any applicable Lending Installation to
any Taxes, or changes the basis of taxation of payments (other
than with respect to Excluded Taxes) to any Lender in respect
of its Eurodollar Loans, or
(ii) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and
assessments taken into account in determining the interest
rate applicable to Eurodollar Advances), or
(iii) imposes any other condition the result of which is to
increase the cost to any Lender or any applicable Lending
Installation of making, funding or maintaining its Eurodollar
Loans or reduces any amount receivable by any Lender or any
applicable Lending Installation in connection with its
Eurodollar Loans, or requires any Lender or any applicable
Lending Installation to make any payment calculated by
reference to the amount of Eurodollar Loans held or interest
received by it, by an amount deemed material by such Lender,
and the result of any of the foregoing is to increase the cost to such Lender or
applicable Lending Installation of making or maintaining its Eurodollar Loans or
Commitment or to reduce the return received by such Lender or applicable Lending
Installation in connection with such Eurodollar Loans or Commitment, then,
within 15 days of demand by such Lender, the Borrower shall pay such Lender such
additional amount or amounts as will compensate such Lender for such increased
cost or reduction in amount received.
3.2. Changes in Capital Adequacy Regulations. If a Lender
determines the amount of capital required or expected to be maintained by such
Lender, any Lending Installation of such Lender or any corporation controlling
such Lender is increased as a result of a Change, then, within 15 days of demand
by such Lender, the Borrower shall pay such Lender the amount necessary to
compensate for any shortfall in the rate of return on the portion of such
increased capital which such Lender determines is attributable to this
Agreement, its Loans or its Commitment to make Loans hereunder (after taking
into account such Lender's policies as to capital adequacy). "Change" means (i)
any change after the Effective Date in the Risk-Based Capital Guidelines or (ii)
any adoption of or change in any other law, governmental or quasi-governmental
rule, regulation, policy, guideline, interpretation, or directive (whether or
not having the force of law) after the Effective Date which affects the amount
of capital required or expected to be maintained by any Lender or any Lending
Installation or any corporation controlling any Lender. "Risk-Based Capital
Guidelines" means (i) the risk-based capital guidelines in effect in the United
States on the Effective Date, including transition rules, and (ii) the
corresponding capital regulations promulgated by regulatory authorities outside
the United States implementing the July 1988 report of the Basle Committee on
Banking Regulation and Supervisory Practices Entitled "International Convergence
of Capital Measurements and Capital Standards," including transition rules, and
any amendments to such regulations adopted prior to the Effective Date.
28
3.3. Availability of Types of Advances. If any Lender determines
that maintenance of its Eurodollar Loans at a suitable Lending Installation
would violate any applicable law, rule, regulation, or directive, whether or not
having the force of law, or if the Required Lenders determine that (i) deposits
of a type and maturity appropriate to match fund Eurodollar Advances are not
available or (ii) the interest rate applicable to Eurodollar Advances does not
accurately reflect the cost of making or maintaining Eurodollar Advances, then
the Agent shall suspend the availability of Eurodollar Advances and require any
affected Eurodollar Advances to be converted to Floating Rate Advances.
3.4. Funding Indemnification. If any payment of a Eurodollar
Advance occurs on a date which is not the last day of the applicable Interest
Period, whether because of acceleration, prepayment or otherwise, or a
Eurodollar Advance is not made on the date specified by the Borrower for any
reason other than default by the Lenders, the Borrower will indemnify each
Lender for any loss or cost incurred by it resulting therefrom, including,
without limitation, any loss or cost in liquidating or employing deposits
acquired to fund or maintain such Eurodollar Advance. Notwithstanding the
foregoing, the Borrower will not be required to pay any breakage fees or to
indemnify the Lenders for any losses or costs resulting from the prepayment on
the Effective Date of the Eurodollar Advances outstanding under the Existing
Credit Agreement or from the Borrower's payment of the interest accrued thereon
on the Effective Date as required under Section 4.1.4(i).
3.5. Taxes.
(i) All payments by the Borrower to or for the account of any
Lender or the Agent hereunder or under any Note shall be made
free and clear of and without deduction for any and all
Taxes. If the Borrower shall be required by law to deduct any
Taxes from or in respect of any sum payable hereunder to any
Lender or the Agent, (a) the sum payable shall be increased
as necessary so that after making all required deductions
(including deductions applicable to additional sums payable
under this Section 3.5) such Lender or the Agent (as the case
may be) receives an amount equal to the sum it would have
received had no such deductions been made, (b) the Borrower
shall make such deductions, (c) the Borrower shall pay the
full amount deducted to the relevant authority in accordance
with applicable law and (d) the Borrower shall furnish to the
Agent the original copy of a receipt evidencing payment
thereof within 30 days after such payment is made.
(ii) In addition, the Borrower hereby agrees to pay any present or
future stamp or documentary taxes and any other excise or
property taxes, charges or similar levies which arise from
any payment made hereunder or under any Note or from the
execution or delivery of, or otherwise with respect to, this
Agreement or any Note ("Other Taxes").
(iii) The Borrower hereby agrees to indemnify the Agent and each
Lender for the full amount of Taxes or Other Taxes
(including, without limitation, any Taxes or Other Taxes
imposed on amounts payable under this Section 3.5) paid by
the
29
Agent or such Lender and any liability (including penalties,
interest and expenses, other than penalties, interest and
expenses proximately arising from the gross negligence of the
party seeking to be indemnified) arising therefrom or with
respect thereto. Payments due under this indemnification shall
be made within 30 days of the date the Agent or such Lender
makes demand therefor pursuant to Section 3.6.
(iv) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof (each a "Non-U.S.
Lender") agrees that it will, not less than ten Business Days
after the Effective Date, (i) deliver to each of the Borrower
and the Agent two duly completed copies of United States
Internal Revenue Service Form 1001 or 4224, certifying in
either case that such Lender is entitled to receive payments
under this Agreement without deduction or withholding of any
United States federal income taxes, and (ii) deliver to each
of the Borrower and the Agent a United States Internal
Revenue Form W-8 or W-9, as the case may be, and certify that
it is entitled to an exemption from United States backup
withholding tax. Each Non-U.S. Lender further undertakes to
deliver to each of the Borrower and the Agent (x) renewals or
additional copies of such form (or any successor form) on or
before the date that such form expires or becomes obsolete,
and (y) after the occurrence of any event requiring a change
in the most recent forms so delivered by it, such additional
forms or amendments thereto as may be reasonably requested by
the Borrower or the Agent. All forms or amendments described
in the preceding sentence shall certify that such Lender is
entitled to receive payments under this Agreement without
deduction or withholding of any United States federal income
taxes, unless an event (including without limitation any
change in treaty, law or regulation) has occurred prior to
the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which
would prevent such Lender from duly completing and delivering
any such form or amendment with respect to it and such Lender
advises the Borrower and the Agent that it is not capable of
receiving payments without any deduction or withholding of
United States federal income tax.
(v) For any period during which a Non-U.S. Lender has failed to
provide the Borrower with an appropriate form pursuant to
clause (iv), above (unless such failure is due to a change in
treaty, law or regulation, or any change in the
interpretation or administration thereof by any governmental
authority, occurring subsequent to the date on which a form
originally was required to be provided), such Non-U.S. Lender
shall not be entitled to indemnification under this Section
3.5 with respect to Taxes imposed by the United States;
provided that, should a Non-U.S. Lender which is otherwise
exempt from or subject to a reduced rate of withholding tax
become subject to Taxes because of its failure to deliver a
form required under clause (iv), above, the Borrower shall
take such steps as such Non-U.S. Lender shall reasonably
request to assist such Non-U.S. Lender to recover such Taxes.
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(vi) Any Lender that is entitled to an exemption from or reduction
of withholding tax with respect to payments under this
Agreement or any Note pursuant to the law of any relevant
jurisdiction or any treaty shall deliver to the Borrower
(with a copy to the Agent), at the time or times prescribed
by applicable law, such properly completed and executed
documentation prescribed by applicable law as will permit
such payments to be made without withholding or at a reduced
rate.
(vii) If the U.S. Internal Revenue Service or any other
governmental authority of the United States or any other
country or any political subdivision thereof asserts a claim
that the Agent did not properly withhold tax from amounts
paid to or for the account of any Lender (because the
appropriate form was not delivered or properly completed,
because such Lender failed to notify the Agent of a change in
circumstances which rendered its exemption from withholding
ineffective, or for any other reason), such Lender shall
indemnify the Agent fully for all amounts paid, directly or
indirectly, by the Agent as tax, withholding therefor, or
otherwise, including penalties and interest, and including
taxes imposed by any jurisdiction on amounts payable to the
Agent under this subsection, together with all costs and
expenses related thereto (including attorneys fees and time
charges of attorneys for the Agent, which attorneys may be
employees of the Agent). The obligations of the Lenders under
this Section 3.5(vii) shall survive the payment of the
Obligations and termination of this Agreement.
3.6. Lender Statements; Survival of Indemnity. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its Eurodollar Loans to reduce any liability of the
Borrower to such Lender under Sections 3.1, 3.2 and 3.5 or to avoid the
unavailability of Eurodollar Advances under Section 3.3, so long as such
designation is not, in the judgment of such Lender, disadvantageous to such
Lender. Each Lender shall deliver a written statement of such Lender to the
Borrower (with a copy to the Agent) as to the amount due, if any, under Section
3.1, 3.2, 3.4 or 3.5. Such written statement shall set forth in reasonable
detail the calculations upon which such Lender determined such amount and shall
be final, conclusive and binding on the Borrower in the absence of manifest
error. Determination of amounts payable under such Sections in connection with a
Eurodollar Loan shall be calculated as though each Lender funded its Eurodollar
Loan through the purchase of a deposit of the type and maturity corresponding to
the deposit used as a reference in determining the Eurodollar Rate applicable to
such Loan, whether in fact that is the case or not. Unless otherwise provided
herein, the amount specified in the written statement of any Lender shall be
payable on demand after receipt by the Borrower of such written statement. The
obligations of the Borrower under Sections 3.1, 3.2, 3.4 and 3.5 shall survive
payment of the Obligations and termination of this Agreement.
ARTICLE IV
CONDITIONS PRECEDENT
4.1. Conditions to Effective Date. The obligation of the Lenders to
establish the Facilities, to make the initial Advance under the Revolving Credit
Facility and to make the Term Loans and the R/E Term Loans under the Term Loan
Facility and the R/E Term Loan Facility,
31
respectively, is subject to the Borrower's satisfaction of the following
conditions precedent at or as of the Effective Date:
4.1.1. Execution and Delivery of Loan Documents. The
Borrower shall have executed and delivered to the Agent, and (as applicable)
caused UST to execute and deliver to the Agent, the following Loan Documents in
sufficient copies for the Agent and each of the Lenders:
(i) This Agreement.
(ii) Any Notes requested by a Lender pursuant to
Section 2.13 payable to the order of each
such requesting Lender.
4.1.2. Delivery of Documents. The Borrower shall have
executed (where necessary) and delivered the following documents to the Agent,
together with sufficient copies for each of the Lenders:
(i) Copies of the articles or certificate of incorporation of each
of the Borrower and UST, together with all amendments thereto,
and a certificate of good standing for each of the Borrower
and UST, each certified by the appropriate governmental
officer in its jurisdiction of incorporation, and copies of a
certificate of good standing issued by the appropriate
governmental officer in each other jurisdiction in which the
Borrower and/or UST has any offices or conducts any
significant business operations.
(ii) Copies of the bylaws of each of the Borrower and UST, each
certified by its Secretary or Assistant Secretary.
(iii) Copies of the resolutions or other actions of the Board of
Directors or other governing body of each the Borrower and
UST, authorizing the execution of the Loan Documents to which
it is a party.
(iv) An incumbency certificate, executed by the Secretary or
Assistant Secretary of the Borrower, which shall identify by
name and title and bear the signatures of the Authorized
Officers and any other officers of the Borrower authorized to
sign the Loan Documents to which the Borrower is a party, upon
which certificate the Agent and the Lenders shall be entitled
to rely until informed of any change in writing by the
Borrower, and an incumbency certificate, executed by the
Secretary or Assistant Secretary of UST, which shall identify
by name and title and bear the signatures of the officers of
the UST authorized to sign the Loan Documents to which UST is
a party, upon which certificate the Agent and the Lenders
shall be entitled to rely until informed of any change in
writing by UST.
(v) A certificate, signed by the chief financial officer of the
Borrower, stating that, to the best of such officer's
knowledge, after diligent inquiry, on or as of the Effective
Date, (A) no Default or Unmatured Default has occurred and is
32
continuing, (B) the representations and warranties continued
in Article V of this Agreement are true and correct, and (C)
the Borrower has experienced no material adverse change in its
consolidated financial position since July 31, 2001.
(vi) A written opinion of counsel to the Borrower and UST,
addressed to the Agent and the Lenders, in substantially the
form of Exhibit "A."
(vii) Written money transfer instructions, in substantially the form
of Exhibit "E," addressed to the Agent and signed by an
Authorized Officer, together with such other related money
transfer authorizations as the Agent may have reasonably
requested.
(viii) The insurance certificate described in Section 5.21.
(ix) A Borrowing Base Certificate prepared as of date not earlier
than September 30, 2001.
(x) Such other documents as any Lender or its counsel may have
reasonably requested.
4.1.3. Headquarters Building. The Borrower shall have
delivered the following documents to the Agent, together with sufficient copies
for each of the Lenders, each in form and substance satisfactory to the Agent
(provided, however, that the documents required to be delivered pursuant to
clauses (ii) and (iii) below may be delivered subsequent to the Effective Date,
but in any event not later than November 30, 2001):
(i) A recent "as built" appraisal of the Headquarters Building
conducted by an independent appraiser selected by the Agent
and conforming to the appraisal standards promulgated by the
Comptroller of the Currency under FIRREA.
(ii) A current ALTA/ASCM pin survey of the Headquarters Building,
certified to the Agent and the Lenders and prepared by a
licensed civil engineer or surveyor satisfactory to the Agent,
which (A) includes a legal description identical to the legal
description identified in the title insurance commitment
referred to in clause (iii) below), (B) locates all property
corners by "pin," (C) locates the perimeter of the
Headquarters Building; (D) locates any improvements (e.g.,
water, gas, electric and sewer lines, walks, alleys, drives);
(E) locates and identifies (by reference to book and page
number and/or instrument of record) all easements, rights of
way, setback lines and other matters affecting the
Headquarters Building and set forth in the title insurance
commitment, (F) shows other physical matters affecting the
title and use of the Headquarters Building required by the
Agent and the title insurance company issuing the title
insurance commitment; and (G) otherwise is in form and
substance satisfactory to the Agent.
(iii) An original mortgagee's title insurance commitment in favor of
the Agent and the Lenders, issued by a title insurer and agent
satisfactory to the Agent, committing
33
to issue an ALTA mortgagee's title insurance policy insuring
the Mortgage to be a first and prior lien on the Headquarters
Building and improvements described therein, containing only
such exceptions as are acceptable to the Agent, and subject to
the following additional requirements: (A) the insured amount
must be equal to the Loan Value of the Headquarters Building;
(B) the legal description must be identical with the
description of the Headquarters Building identified in the
survey delivered pursuant to clause (ii) above; (C) the legal
description must show as separately insured parcels any
off-premises easements that benefit the Headquarters Building;
(D) the title insurance commitment must list and identify by
reference to book and page number all easements, rights of way
and other instruments or matters affecting title to the
Headquarters Building or any off-premises easements that
benefit the Headquarters Building; (E) legible copies of all
instruments affecting title to the Headquarters Building must
be submitted with the title insurance commitment; and (F) the
"standard" exceptions regarding matters which a survey would
disclose, mechanics' and materialmen' liens, and possessory
interests, must be deleted.
(iv) Evidence satisfactory to the Agent that the Headquarters
Building is not located in an area designated by the Secretary
of Housing and Urban Development as an area having special
flood or mudslide hazards, and that flood hazard insurance is
not required for the credit to be extended under this
Agreement pursuant to the terms of any law, rule or regulation
governing the activities of the Lenders.
(v) If requested by the Agent, evidence satisfactory to the Agent
that the Headquarters Building is zoned for its current use
and is in full compliance with all municipal and private
ordinances, codes, rules, regulations, restrictions and
covenants.
(vi) A favorable "Phase I" environmental assessment report covering
the Headquarters Building prepared by an environmental
engineering firm acceptable to the Agent, in form and
substance satisfactory to the Agent, and stating that (i) the
Headquarters Building is free of any toxic or hazardous wastes
or substances, and (ii) that there has not been any release or
discharge of toxic or hazardous wastes or substances on, under
or about the Headquarters Building.
4.1.4. Other Conditions. The Borrower shall have satisfied
the following additional conditions precedent at or as of the Effective Date:
(i) The Borrower shall have paid all principal installments stated
to be due and payable on or before the Effective Date under
the terms of the Existing Credit Agreement, together with all
unpaid interest accrued under the Existing Credit Agreement as
of the Effective Date.
(ii) The Borrower shall have paid all fees due under this Agreement
or the Existing Credit Agreement or under the Fee Letter, to
the extent such fees are dues and payable at or as of the
Effective Date.
34
(iii) There shall not have occurred any material adverse change in
the business, Property, prospects, condition (financial or
otherwise) or results of operations of the Borrower or UST.
(iv) The Borrower shall have entered into Rate Management
Transactions (either in the form of a swap, cap or similar
hedge) with each Lender (or one of its Affiliates) providing
interest rate protection on at least 50% of such Lender's Pro
Rata Share of the Aggregate Term Loan Commitment and Aggregate
R/E Term Loan Commitment for a period of at least two years.
4.2. Each Advance. The Lenders shall not be required to make an
Advance under any Facility unless on the applicable Borrowing Date:
(i) There exists no Default or Unmatured Default.
(ii) The representations and warranties contained in Article V are
true and correct as of such Borrowing Date except to the
extent any such representation or warranty is stated to relate
solely to an earlier date, in which case such representation
or warranty shall have been true and correct on and as of such
earlier date.
(iii) All legal matters incident to the making of such Advance shall
be satisfactory to the Lenders and their counsel.
4.3 Effect of Borrowing Notice. Each Borrowing Notice with respect
to each such Advance shall constitute a representation and warranty by the
Borrower that the conditions contained in Sections 4.2(i) and (ii) have been
satisfied. Any Lender may require a duly completed Compliance Certificate as a
condition to making an Advance.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lenders as follows:
5.1. Existence and Standing. Each of the Borrower and its
Subsidiaries is and will continue to be a corporation, partnership or limited
liability company, duly and properly incorporated or organized, as the case may
be, validly existing and (to the extent such concept applies to such entity) in
good standing under the laws of its jurisdiction of incorporation or
organization and has all requisite authority and is duly qualified or licensed
to conduct its business in each jurisdiction in which it owns any Property or
conducts any business (except where failure to be so qualified or licensed could
not reasonably be expected to have a Material Adverse Effect or result in the
forfeiture of any Property). Neither the Borrower nor any of its Subsidiaries
owns any Property or conducts business outside the United States of America.
5.2. Authorization and Validity. Each of the Borrower and its
Subsidiaries has the power and authority and legal right to execute and deliver
the Loan Documents to which it is a party and to perform its obligations
thereunder. The execution and delivery by each of the
35
Borrower and its Subsidiaries of the Loan Documents to which it is a party and
the performance of its obligations thereunder have been duly authorized by
proper corporate proceedings, and the Loan Documents to which it is a party
constitute its legal, valid and binding obligations, enforceable against it in
accordance with their terms, except as enforceability may be limited by
bankruptcy, insolvency or similar laws affecting the enforcement of creditors'
rights generally.
5.3. No Conflict; Government Consent. Neither the execution and
delivery by the Borrower and its Subsidiaries of the Loan Documents to which
each is a party, nor the consummation of the transactions therein contemplated,
nor compliance with the provisions thereof will violate (i) any law, rule,
regulation, order, writ, judgment, injunction, decree or award binding on the
Borrower or any of its Subsidiaries or (ii) the Borrower's or any Subsidiary's
articles or certificate of incorporation, partnership agreement, certificate of
partnership, articles or certificate of organization, by-laws, or operating or
other management agreement, as the case may be, or (iii) the provisions of any
indenture, instrument or agreement to which the Borrower or any of its
Subsidiaries is a party or is subject, or by which it, or its Property, is
bound, or conflict with or constitute a default thereunder, or result in, or
require, the creation or imposition of any Lien in, of or on the Property of the
Borrower or a Subsidiary pursuant to the terms of any such indenture, instrument
or agreement. No order, consent, adjudication, approval, license, authorization,
or validation of, or filing, recording or registration with, or exemption by, or
other action in respect of any governmental or public body or authority, or any
subdivision thereof, which has not been obtained by the Borrower or any of its
Subsidiaries, is required to be obtained by the Borrower or any of its
Subsidiaries in connection with the execution and delivery of the Loan
Documents, the borrowings under this Agreement, the payment and performance by
the Borrower of the Obligations or the legality, validity, binding effect or
enforceability of any of the Loan Documents.
5.4. Financial Statements. The audited consolidated financial
statements of the Borrower for the fiscal year ended October 31, 2000, and the
unaudited interim consolidated financial statements of the Borrower for the nine
months ended July 31, 2001, copies of which have heretofore been delivered to
the Lenders, were prepared in accordance with GAAP in effect on the date such
statements were prepared and fairly present the financial position of the
Borrower at such date and the results of operations for the periods then ended.
5.5. Material Adverse Change. Since the respective dates of the
financial statements referred to in Section 5.4, there has been no adverse
change in the business, Property, prospects, condition (financial or otherwise)
or results of operations of the Borrower and its Subsidiaries which could
reasonably be expected to have a Material Adverse Effect.
5.6. Taxes. The Borrower and its Subsidiaries have filed all
United States federal tax returns and all other tax returns which are required
to be filed and have paid all taxes due pursuant to said returns or pursuant to
any assessment received by the Borrower or any of its Subsidiaries, except for
(i) such taxes, if any, as are being contested in good faith and as to which
adequate reserves have been provided in accordance with GAAP and as to which no
Lien exists, and (ii) such taxes, if any, which may be owing by UST as a result
of certain matters which have been disclosed in a letter dated November 30,
1999, addressed to the Lenders. As of the Effective Date, the United States
income tax returns of the Borrower have been audited by the Internal
36
Revenue Service through the fiscal year ended October 31, 1999. No tax liens
have been filed and no claims are being asserted with respect to any such taxes.
The charges, accruals and reserves on the books of the Borrower and its
Subsidiaries in respect of any taxes or other governmental charges are adequate.
5.7. Litigation and Contingent Obligations. There is no litigation,
arbitration, governmental investigation, proceeding or inquiry pending or, to
the knowledge of any of their officers, threatened against or affecting the
Borrower or any of its Subsidiaries which could reasonably be expected to have a
Material Adverse Effect or which seeks to prevent, enjoin or delay the making of
any Loans. Other than any liability incident to any litigation, arbitration or
proceeding which could not reasonably be expected to have a Material Adverse
Effect, the Borrower has no material contingent obligations not provided for or
disclosed in the financial statements referred to in Section 5.4.
5.8. Subsidiaries. Schedule 1 contains an accurate list of all
Subsidiaries of the Borrower as of the Effective Date, setting forth their
respective jurisdictions of organization and the percentage of their respective
capital stock or other ownership interests owned by the Borrower or other
Subsidiaries. All of the issued and outstanding shares of capital stock or other
ownership interests of such Subsidiaries have been (to the extent such concepts
are relevant with respect to such ownership interests) duly authorized and
issued and are fully paid and non-assessable.
5.9. ERISA. No Single Employer Plan has any Unfunded Liabilities.
Each Plan complies in all material respects with all applicable requirements of
law and regulations, no Reportable Event has occurred with respect to any Plan,
neither the Borrower nor any other member of the Controlled Group has withdrawn
from any Plan or initiated steps to do so, and no steps have been taken to
reorganize or terminate any Plan.
5.10. Accuracy of Information. No information, exhibit or report
furnished by the Borrower or any of its Subsidiaries to the Agent or to any
Lender in connection with the negotiation of, or compliance with, the Loan
Documents contained any material misstatement of fact or omitted to state a
material fact or any fact necessary to make the statements contained therein not
misleading.
5.11. Regulation U. Margin stock (as defined in Regulation U)
constitutes less than 25% of the value of those assets of the Borrower and its
Subsidiaries which are subject to any limitation on sale, pledge, or other
restriction hereunder.
5.12. Material Agreements. Neither the Borrower nor any Subsidiary
is a party to any agreement or instrument or subject to any charter or other
corporate restriction which could reasonably be expected to have a Material
Adverse Effect. Neither the Borrower nor any Subsidiary is in default in the
performance, observance or fulfillment of any of the obligations, covenants or
conditions contained in (i) any agreement to which it is a party, which default
could reasonably be expected to have a Material Adverse Effect or (ii) any
agreement or instrument evidencing or governing Indebtedness.
37
5.13. Compliance With Laws. The Borrower and its Subsidiaries have
complied with all applicable statutes, rules, regulations, orders and
restrictions of any domestic or foreign government or any instrumentality or
agency thereof having jurisdiction over the conduct of their respective
businesses or the ownership of their respective Property.
5.14. Ownership of Properties. Except as set forth on Schedule 2,
on the Effective Date, the Borrower and its Subsidiaries will have good title,
free of all Liens other than those permitted by Section 6.15, to all of the
Property and assets reflected in the Borrower's most recent consolidated
financial statements provided to the Agent as owned by the Borrower and its
Subsidiaries.
5.15. Plan Assets; Prohibited Transactions. The Borrower is not an
entity deemed to hold "plan assets" within the meaning of 29 C.F.R. Section
2510.3-101 of an employee benefit plan (as defined in Section 3(3) of ERISA)
which is subject to Title I of ERISA or any plan (within the meaning of Section
4975 of the Code), and neither the execution of this Agreement nor the making of
Loans hereunder gives rise to a prohibited transaction within the meaning of
Section 406 of ERISA or Section 4975 of the Code.
5.16. Environmental Matters. In the ordinary course of its business,
the officers of the Borrower consider the effect of Environmental Laws on the
business of the Borrower and its Subsidiaries, in the course of which they
identify and evaluate potential risks and liabilities accruing to the Borrower
due to Environmental Laws. On the basis of this consideration, the Borrower has
concluded that Environmental Laws cannot reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor any Subsidiary has received
any notice to the effect that its operations are not in material compliance with
any of the requirements of applicable Environmental Laws or are the subject of
any federal or state investigation evaluating whether any remedial action is
needed to respond to a release of any toxic or hazardous waste or substance into
the environment, which non-compliance or remedial action could reasonably be
expected to have a Material Adverse Effect.
5.17. Investment Company Act. Neither the Borrower nor any
Subsidiary is an "investment company" or a company "controlled" by an
"investment company", within the meaning of the Investment Company Act of 1940,
as amended.
5.18. Public Utility Holding Company Act. Neither the Borrower nor
any Subsidiary is a "holding company" or a "subsidiary company" of a "holding
company", or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company", within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19. INTENTIONALLY OMITTED
5.20. Post-Retirement Benefits. Neither the Borrower nor any
Subsidiary provides or is obligated to provide any post-retirement medical and
insurance benefits to its employees or former employees.
38
5.21. Insurance. The certificate signed by the President or chief
financial officer of the Borrower, that attests to the existence and adequacy
of, and summarizes, the property and casualty insurance program carried by the
Borrower with respect to itself and its Subsidiaries and that has been furnished
by the Borrower to the Agent and the Lenders, is complete and accurate. This
summary includes the insurer's or insurers' name(s), policy number(s),
expiration date(s), amount(s) of coverage, type(s) of coverage, exclusion(s),
and deductibles. This summary also includes similar information, and describes
any reserves, relating to any self-insurance program that is in effect.
5.22. Solvency.
(i) Immediately after the consummation of the transactions to
occur on the Effective Date and immediately following the
making of each Loan to be made on the Effective Date or at any
time thereafter, and after giving effect to the application of
the proceeds of such Loans, (a) the fair value of the assets
of the Borrower and its Subsidiaries on a consolidated basis,
at a fair valuation, will exceed the debts and liabilities,
subordinated, contingent or otherwise, of the Borrower and its
Subsidiaries on a consolidated basis; (b) the present fair
saleable value of the Properties of the Borrower and its
Subsidiaries on a consolidated basis will be greater than the
amount that will be required to pay the probable liability of
the Borrower and its Subsidiaries on a consolidated basis on
their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute
and matured; (c) the Borrower and its Subsidiaries on a
consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) the
Borrower and its Subsidiaries on a consolidated basis will not
have unreasonably small capital with which to conduct the
businesses in which they are engaged as such businesses are
now conducted and are proposed to be conducted after the
Effective Date.
(ii) The Borrower does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its
Subsidiaries will, incur debts beyond its ability to pay such
debts as they mature, taking into account the timing of and
amounts of cash to be received by it or any such Subsidiary
and the timing of the amounts of cash to be payable on or in
respect of its Indebtedness or the Indebtedness of any such
Subsidiary.
ARTICLE VI
COVENANTS
During the term of this Agreement, unless the Required Lenders shall
otherwise consent in writing:
6.1. Financial Reporting. The Borrower will maintain, for itself
and each Subsidiary, a system of accounting established and administered in
accordance with GAAP, and will furnish to the Lenders:
39
(i) Within 90 days after the close of each of its fiscal years, an
unqualified audit report certified by independent certified
public accountants acceptable to the Lenders, prepared in
accordance with GAAP on a consolidated and consolidating basis
(consolidating statements need not be certified by such
accountants) for itself and its Subsidiaries, including
balance sheets as of the end of such period, related profit
and loss and reconciliation of surplus statements, and a
statement of cash flows, accompanied by any management letter
prepared by said accountants.
(ii) Within 45 days after the close of the first three quarterly
periods of each of its fiscal years, for itself and its
Subsidiaries, consolidated and consolidating unaudited
balance sheets as at the close of each such period and
consolidated and consolidating profit and loss and
reconciliation of surplus statements and a statement of cash
flows for the period from the beginning of such fiscal year to
the end of such quarter, all certified by its chief financial
officer.
(iii) Together with the financial statements required under Sections
6.1(i) and (ii), a Compliance Certificate signed by its chief
financial officer showing the calculations necessary to
determine compliance with this Agreement and stating that no
Default or Unmatured Default exists, or if any Default or
Unmatured Default exists, stating the nature and status
thereof.
(iv) Within 15 days following the end of each month, a completed
Borrowing Base Certificate prepared as of the last day of such
month and certified by the chief executive officer or chief
financial officer of the Borrower, together with a report, in
form satisfactory to the Agent, prepared as of the end of such
month and certified by the chief executive officer or chief
financial officer of the Borrower, detailing (A) all Accounts
of the Borrower and its Subsidiaries as of the end of such
month, showing as to each account debtor (1) the total amount
owing, (2) the current amount owing, and (3) the amounts past
due (including the aging, from the initial invoice date,
thereof), (B) all accounts payable of the Borrower and its
Subsidiaries as of the end of such month, showing as to each
account payable the name of the vendor or supplier, number of
days outstanding, and current balance; and (C) a detail of all
Inventory of the Borrower and its Subsidiaries as of the end
of such month.
(v) Within 90 days after the close of each of its fiscal years, a
financial projection and budget forecast covering the
immediately subsequent three year period.
(vi) Within 270 days after the close of each fiscal year, a
statement of the Unfunded Liabilities of each Single Employer
Plan, certified as correct by an actuary enrolled under ERISA.
(vii) As soon as possible and in any event within 10 days after the
Borrower knows that any Reportable Event has occurred with
respect to any Plan, a statement,
40
signed by the chief financial officer of the Borrower,
describing said Reportable Event and the action which the
Borrower proposes to take with respect thereto.
(viii) As soon as possible and in any event within 10 days after
receipt by the Borrower, a copy of (a) any notice or claim to
the effect that the Borrower or any of its Subsidiaries is or
may be liable to any Person as a result of the release by the
Borrower, any of its Subsidiaries, or any other Person of any
toxic or hazardous waste or substance into the environment,
and (b) any notice alleging any violation of any federal,
state or local environmental, health or safety law or
regulation by the Borrower or any of its Subsidiaries.
(ix) Promptly upon the furnishing thereof to the shareholders of
the Borrower, copies of all financial statements, reports and
proxy statements so furnished.
(x) Promptly upon the filing thereof, copies of all registration
statements and annual, quarterly, monthly or other regular
reports which the Borrower or any of its Subsidiaries files
with the SEC.
(xi) Such other information (including non-financial information)
as the Agent or any Lender may from time to time reasonably
request.
6.2. Use of Proceeds. The Borrower will, and will cause each
Subsidiary to, use the proceeds of the Advances only for the purposes stated in
Section 2.2. The Borrower will not, nor will it permit any Subsidiary to, use
any of the proceeds of the Advances to purchase or carry any "margin stock" (as
defined in Regulation U).
6.3. Notice of Default. The Borrower will, and will cause each
Subsidiary to, give prompt notice in writing to the Lenders of the occurrence of
any Default or Unmatured Default and of any other development, financial or
otherwise, which could reasonably be expected to have a Material Adverse Effect.
6.4. Conduct of Business. The Borrower will, and will cause each
Subsidiary to, carry on and conduct its business in substantially the same
manner and in substantially the same fields of enterprise as it is presently
conducted and do all things necessary to remain duly incorporated or organized,
validly existing and (to the extent such concept applies to such entity) in good
standing as a domestic corporation, partnership or limited liability company in
its jurisdiction of incorporation or organization, as the case may be, and
maintain all requisite authority to conduct its business in each jurisdiction in
which its business is conducted.
6.5. Taxes. The Borrower will, and will cause each Subsidiary to,
timely file complete and correct United States federal and applicable foreign,
state and local tax returns required by law and pay when due all taxes,
assessments and governmental charges and levies upon it or its income, profits
or Property, except those which are being contested in good faith by appropriate
proceedings and with respect to which adequate reserves have been set aside in
accordance with GAAP.
41
6.6. Insurance. The Borrower will, and will cause each Subsidiary
to, maintain with financially sound and reputable insurance companies insurance
on all their Property in such amounts and covering such risks as is consistent
with sound business practice, and the Borrower will furnish to any Lender upon
request full information as to the insurance carried.
6.7. Compliance with Laws. The Borrower will, and will cause each
Subsidiary to, comply with all laws, rules, regulations, orders, writs,
judgments, injunctions, decrees or awards to which it may be subject including,
without limitation, all Environmental Laws.
6.8. Maintenance of Properties. The Borrower will, and will cause
each Subsidiary to, do all things necessary to maintain, preserve, protect and
keep its Property in good repair, working order and condition, and make all
necessary and proper repairs, renewals and replacements so that its business
carried on in connection therewith may be properly conducted at all times.
6.9. Inspection. The Borrower will, and will cause each Subsidiary
to, permit the Agent and the Lenders, by their respective representatives and
agents, to inspect any of the Property, books and financial records of the
Borrower and each Subsidiary, to examine and make copies of the books of
accounts and other financial records of the Borrower and each Subsidiary, and to
discuss the affairs, finances and accounts of the Borrower and each Subsidiary
with, and to be advised as to the same by, their respective officers at such
reasonable times and intervals as the Agent or any Lender may designate. The
Borrower will permit the Agent and the Lenders to conduct field audits of the
books and records of the Borrowers and its Subsidiaries on at least an annual
basis, at the cost of the Borrower.
6.10. Dividends. The Borrower will not, nor will it permit any
Subsidiary to, declare or pay any dividends or make any distributions on its
capital stock (other than dividends payable in its own capital stock) or redeem,
repurchase or otherwise acquire or retire any of its capital stock at any time
outstanding, except that (i) any Subsidiary may declare and pay dividends or
make distributions to the Borrower or to a Wholly-Owned Subsidiary and (ii) the
Borrower may pay cash dividends on its capital stock so long as (A) no Default
or Unmatured Default exists on the date any such dividend is paid or declared,
and (B) the payment of such dividend will not result in or give rise to any
Default or Unmatured Default, including a violation of any of the financial
covenants set forth in Section 6.24.
6.11. Indebtedness. The Borrower will not, nor will it permit any
Subsidiary to, create, incur or suffer to exist any Indebtedness, except:
(i) The Loans.
(ii) Indebtedness existing on the date hereof and described in
Schedule 2.
(iii) Purchase money Indebtedness incurred in the ordinary course of
business in connection with the Borrower's purchase of
equipment used in connection with its business and not
exceeding $250,000 at any one time outstanding.
42
(iv) Obligations, not exceeding $5,000,000 in the aggregate at any
one time outstanding, representing the deferred purchase price
(or other seller financing) payable to the seller or sellers
in connection with Acquisitions consummated prior to the
Effective Date or consented to by the Required Lenders after
the Effective Date, provided that the terms and conditions of
such seller financing have been approved in advance by the
Required Lenders.
(v) Rate Management Obligations arising under Rate Management
Transactions related to the Loans.
6.12. Mergers and Acquisitions.
6.12.1. Mergers and Consolidations. The Borrower will not,
nor will it permit any Subsidiary to, merge or consolidate with or into any
other Person, except that a Subsidiary may merge into the Borrower or a
Wholly-Owned Subsidiary.
6.12.2. Acquisitions. The Borrower will not, nor will it
permit any Subsidiary to, make any Acquisition of any Person.
6.13. Sale of Assets. The Borrower will not, nor will it permit any
Subsidiary to, lease, sell or otherwise dispose of its Property to any other
Person, except:
(i) Sales of Inventory in the ordinary course of business.
(ii) Leases, sales or other dispositions of its Property (exclusive
of any Accounts or notes receivable) that, together with all
other Property of the Borrower and its Subsidiaries previously
leased, sold or disposed of (other than Inventory in the
ordinary course of business) as permitted by this Section
6.13(ii) during the twelve-month period ending with the month
in which any such lease, sale or other disposition occurs, do
not constitute a Substantial Portion of the Property of the
Borrower and its Subsidiaries.
6.14. Investments. The Borrower will not, nor will it permit any
Subsidiary to, make or suffer to exist any Investments (including without
limitation, loans and advances to, and other Investments in, Subsidiaries), or
commitments therefor, or to create any Subsidiary or to become or remain a
partner in any partnership or joint venture, except:
(i) Cash Equivalent Investments.
(ii) Existing Investments in Subsidiaries and other Investments in
existence on the date hereof and described in Schedule 1.
(iii) Any Investment arising from an Acquisition which has been
consented to by the Required Lenders.
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(iv) Other Investments not exceeding $500,000 in the aggregate at
any time outstanding.
6.15. Liens. The Borrower will not, nor will it permit any
Subsidiary to, create, incur, or suffer to exist any Lien in, of or on the
Property of the Borrower or any of its Subsidiaries, except:
(i) Liens for taxes, assessments or governmental charges or levies
on its Property if the same shall not at the time be
delinquent or thereafter can be paid without penalty, or are
being contested in good faith and by appropriate proceedings
(ii) Liens imposed by law, such as carriers', warehousemen's and
mechanics' liens and other similar liens arising in the
ordinary course of business which secure payment of
obligations not more than 60 days past due or which are being
contested in good faith by appropriate proceedings and for
which adequate reserves shall have been set aside on its
books.
(iii) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation.
(iv) Utility easements, building restrictions and such other
encumbrances or charges against real property as are of a
nature generally existing with respect to properties of a
similar character and which do not in any material way affect
the marketability of the same or interfere with the use
thereof in the business of the Borrower or its Subsidiaries.
(v) Liens existing on the date hereof and described in Schedule 2.
(vi) Liens in favor of the Agent, for the benefit of the Lenders,
granted pursuant to any Collateral Document.
6.16. Capital Expenditures. The Borrower and its Subsidiaries will
not expend, or become committed to expend, Consolidated Capital Expenditures in
excess of $1,000,000 during any fiscal year on a non-cumulative basis.
6.17. INTENTIONALLY OMITTED
6.18. Affiliates. The Borrower will not, and will not permit any
Subsidiary to, enter into any transaction (including, without limitation, the
purchase or sale of any Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of the Borrower's or such Subsidiary's
business and upon fair and reasonable terms no less favorable to the Borrower or
such Subsidiary than the Borrower or such Subsidiary would obtain in a
comparable arm's-length transaction.
44
6.19. Operating Leases. The Borrower will not, nor will it permit
any Subsidiary to, enter into or remain liable upon any Operating Lease, except
to the extent that the aggregate annual payments due on all Operating Leases of
the Borrower and its Subsidiaries do not exceed $100,000.
6.20. Sale and Leaseback Transactions and Other Off-Balance Sheet
Liabilities. The Borrower will not, nor will it permit any Subsidiary to, enter
into or suffer to exist any (i) Sale and Leaseback Transaction or (ii) any other
transaction pursuant to which it incurs or has incurred Off-Balance Sheet
Liabilities, except for Rate Management Obligations permitted to be incurred
under the terms of Section 6.11(v).
6.21. Contingent Obligations. The Borrower will not, nor will it
permit any Subsidiary to, make or suffer to exist any Contingent Obligation
(including, without limitation, any Contingent Obligation with respect to the
obligations of a Subsidiary), except by endorsement of instruments for deposit
or collection in the ordinary course of business.
6.22. Letters of Credit. None of the Borrowers will apply for or
become liable upon or in respect of any Letter of Credit.
6.23. Financial Contracts. The Borrower will not, nor will it permit
any Subsidiary to, enter into or remain liable upon any Financial Contract,
other than Rate Management Transactions related to the Loans.
6.24. Financial Covenants.
6.24.1. Current Ratio. The Borrower will not permit its
current ratio, determined as of each Quarterly Calculation Date on a
consolidated basis in accordance with GAAP, to be less than 1.10 to 1.0. For
purposes of this Section 6.24.1, the current liabilities of the Borrower will
include the aggregate principal balance of all outstanding Revolving Loans
(regardless of their characterization under GAAP), but will exclude that portion
of the balloon payments falling due at the maturities of the Term Loan Facility
and the R/E Term Loan Facility in excess of the regularly scheduled monthly
installment amounts.
6.24.2. Debt Service Coverage Ratio. The Borrower will not
permit its Consolidated Debt Service Coverage Ratio, determined as of each
Quarterly Calculation Date for the then most-recently ended four fiscal
quarters, to be less than (i) 1.15 to 1.0 at each of January 31, 2002, April 30,
2002, and July 31, 2002, or (ii) 1.20 to 1 at October 31, 2002, and each
Quarterly Calculation Date thereafter.
6.24.3. Leverage Ratio. The Borrower will not permit the
ratio of its Consolidated Funded Indebtedness determined as of each Quarterly
Calculation Date to Consolidated EBITDA for the then most-recently ended four
fiscal quarters, to be greater than (i) 2.75 to 1.0 at each of January 31, 2002,
April 30, 2002, and July 31, 2002, or (ii) 2.50 to 1 at October 31, 2002, and
each Quarterly Calculation Date thereafter.
45
6.24.4. Minimum Net Worth. The Borrower will at all times
maintain Consolidated Net Worth of not less than the sum of (i) $29,000,000 plus
(ii) 75% of Consolidated Net Income earned in each fiscal quarter beginning with
the quarter ending January 31, 2002 (without deduction for losses), plus (iii)
100% of the net proceeds of any offering by the Borrower of equity securities of
the Borrower. Upon receipt of the audited financial statements to be delivered
pursuant to Section 6.1(i) for any fiscal year, the amount stated in clause (i)
of the preceding sentence will be reduced to accommodate any write-down of
goodwill taken during such fiscal year in accordance with the applicable
accounting standards under GAAP.
6.25 Additional Collateral and Guaranties.
6.25.1 Acquisitions. In the event that, subsequent to the
Effective Date, any Person becomes a Subsidiary of the Borrower, whether
pursuant to an Acquisition or otherwise, the Borrower shall pledge all shares of
capital stock or other equity securities of such Subsidiary to the Agent, as
provided in the Security Agreement, and deliver the original stock certificates
evidencing such shares to the Agent, together with appropriate stock powers
executed in blank, and shall cause such Subsidiary (i) to xxxxx x Xxxx (security
interest) in all of its personal property by joining the Security Agreement and
taking such actions as may be necessary to enable the agent to perfect such
lien, (ii) if such Subsidiary owns or leases any real property, to comply with
Section 6.25.2 below, (iii) to execute and deliver to the Agent for the benefit
of the Lenders a guaranty with respect to the Obligations, in the same form and
containing substantially the same terms as the Guaranty, and (iv) otherwise, to
provide such documentation and take such other actions as such Subsidiary would
have provided and taken if such Person had been a Subsidiary on the Effective
Date. The Borrower agrees that, following the delivery of any Collateral
Documents required to be executed and delivered by this Section 6.25.1, the
Agent shall have a valid and enforceable first priority Lien on the respective
Collateral covered thereby, free and clear of all Liens other than Permitted
Liens. All actions to be taken pursuant to this Section 6.25.1 shall be at the
expense of the Borrower, shall be taken to the reasonable satisfaction of the
Agent, and shall be taken prior to or simultaneously with the formation or
Acquisition of such Subsidiary.
6.25.2. Real Property. In the event that, subsequent to the
Effective Date, the Borrower or any of its Subsidiaries intends to acquire or
lease any real property which is material or otherwise important to the business
operations of the Borrower or such Subsidiary, the Borrower shall, or shall
cause such Subsidiary to, notify the Agent of such intent as soon as is
reasonably practicable prior to the acquisition or lease of such real property.
At the request of the Agent or the Required Lenders, the Borrower shall cause
the Borrower or Subsidiary acquiring or leasing the real property to execute and
deliver a mortgage instrument, substantially in the form of the Mortgage
delivered on the Effective Date (subject to variation for compliance with local
law), and provide all relevant documentation with respect thereto. The Borrowers
agree that, following the taking of the actions with respect to any real
property required by this Section 6.25.2, the Agent shall have a valid and
enforceable first priority Lien on such real property, free and clear of all
defects and Liens, except for Permitted Liens and other matters acceptable to
the Agent in its reasonable discretion. All actions to be taken pursuant to this
Section 6.25.2 shall be at the expense of the Borrower, shall be taken to the
reasonable
46
satisfaction of the Agent, and shall be taken within 10 days after such real
property is acquired or leased.
6.26 Operating Accounts. The Borrower will maintain, and will
cause each of its Subsidiaries to maintain, all of its operating accounts,
including commercial lockbox accounts, with Bank One.
ARTICLE VII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
7.1. Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries to the Lenders or the Agent
under or in connection with this Agreement, any Loan, or any certificate or
information delivered in connection with this Agreement or any other Loan
Document shall be materially false on the date as of which made.
7.2. Nonpayment of principal of any Loan when due, or nonpayment of
interest upon any Loan or of any commitment fee or other obligations under any
of the Loan Documents within five days after the same becomes due.
7.3. The breach by the Borrower of any of the terms or provisions
of Section 6.2, 6.10, 6.11, 6.12.1, 6.12.2, 6.13, 6.14, 6.15, 6.16, 6.17, 6.18,
6.19, 6.23, 6.24.1, 6.24.2, 6.24.3 or 6.24.4.
7.4. The breach by the Borrower (other than a breach which
constitutes a Default under another Section of this Article VII) of any of the
terms or provisions of this Agreement which is not remedied within 20 days after
written notice from the Agent or any Lender.
7.5. Failure of the Borrower or any of its Subsidiaries to pay when
due any Indebtedness aggregating in excess of $250,000 ("Material
Indebtedness"), or the default by the Borrower or any of its Subsidiaries in the
performance (beyond the applicable grace period with respect thereto, if any) of
any term, provision or condition contained in any agreement under which any such
Material Indebtedness was created or is governed, or any other event shall occur
or condition exist, the effect of which default or event is to cause, or to
permit the holder or holders of such Material Indebtedness to cause, such
Material Indebtedness to become due prior to its stated maturity; or any
Material Indebtedness of the Borrower or any of its Subsidiaries shall be
declared to be due and payable or required to be prepaid or repurchased (other
than by a regularly scheduled payment) prior to the stated maturity thereof; or
the Borrower or any of its Subsidiaries shall not pay, or admit in writing its
inability to pay, its debts generally as they become due.
7.6. The Borrower or any of its Subsidiaries shall (i) have an
order for relief entered with respect to it under the Federal bankruptcy laws as
now or hereafter in effect, (ii) make an assignment for the benefit of
creditors, (iii) apply for, seek, consent to, or acquiesce in, the appointment
of a receiver, custodian, trustee, examiner, liquidator or similar official for
it or any Substantial Portion of its Property, (iv) institute any proceeding
seeking an order for relief under
47
the Federal bankruptcy laws as now or
hereafter in effect or seeking to adjudicate it a bankrupt or insolvent, or
seeking dissolution, winding up, liquidation, reorganization, arrangement,
adjustment or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors or fail to file an
answer or other pleading denying the material allegations of any such proceeding
filed against it, (v) take any corporate or partnership action to authorize or
effect any of the foregoing actions set forth in this Section 7.6 or (vi) fail
to contest in good faith any appointment or proceeding described in Section 7.7.
7.7. Without the application, approval or consent of the Borrower
or any of its Subsidiaries, a receiver, trustee, examiner, liquidator or similar
official shall be appointed for the Borrower or any of its Subsidiaries or any
Substantial Portion of its Property, or a proceeding described in Section
7.6(iv) shall be instituted against the Borrower or any of its Subsidiaries and
such appointment continues undischarged or such proceeding continues undismissed
or unstayed for a period of 30 consecutive days.
7.8. Any court, government or governmental agency shall condemn,
seize or otherwise appropriate, or take custody or control of, all or any
portion of the Property of the Borrower and its Subsidiaries which, when taken
together with all other Property of the Borrower and its Subsidiaries so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such action occurs,
constitutes a Substantial Portion.
7.9. The Borrower or any of its Subsidiaries shall fail within 30
days to pay, bond or otherwise discharge one or more (i) judgments or orders for
the payment of money in excess of $500,000 in the aggregate, or (ii) nonmonetary
judgments or orders which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect, which judgment(s), in any such case,
is/are not stayed on appeal or otherwise being appropriately contested in good
faith.
7.10. The Unfunded Liabilities of all Single Employer Plans shall
exceed in the aggregate $250,000 or any Reportable Event shall occur in
connection with any Plan.
7.11. The Borrower or any of its Subsidiaries shall (i) be the
subject of any proceeding or investigation pertaining to the release by the
Borrower, any of its Subsidiaries or any other Person of any toxic or hazardous
waste or substance into the environment, or (ii) violate any Environmental Law,
which, in the case of an event described in clause (i) or clause (ii), could
reasonably be expected to have a Material Adverse Effect.
7.12. Any Change in Control shall occur.
7.13. The occurrence of any "default", as defined in any Loan
Document (other than this Agreement) or the breach of any of the terms or
provisions of any Loan Document (other than this Agreement), which default or
breach continues beyond any period of grace therein provided.
48
7.14. Any Collateral Document shall for any reason fail to create a
valid and perfected first priority security interest in the collateral purported
to be covered thereby (other than with respect to motor vehicles included in the
Collateral, to the extent the Agent's lien is not noted on the certificates of
title relating thereto), except as permitted by the terms of any Collateral
Document, or any Collateral Document shall fail to remain in full force or
effect or any action shall be taken to discontinue or to assert the invalidity
or unenforceability of any Collateral Document, or the Borrower or any
Subsidiary shall fail to comply with any of the terms or provisions of any
Collateral Document.
7.15. The Guaranty or any other guaranty hereafter delivered to the
Agent by any Subsidiary in respect of the Obligations shall for any reason cease
to remain in full force or effect, or any action shall be taken by UST or other
Subsidiary party thereto to revoke, cancel or terminate the same or to assert
the invalidity or unenforceability thereof, or UST or such other Subsidiary
shall fail to comply with any of the terms or provisions of the Guaranty or
other guaranty.
7.16. Nonpayment by the Borrower or any Subsidiary of any Rate
Management Obligation when due or the breach by the Borrower or any Subsidiary
of any term, provision or condition contained in any Rate Management
Transaction.
ARTICLE VIII
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
8.1. Acceleration. If any Default described in Section 7.6 or 7.7
occurs with respect to the Borrower, the obligations of the Lenders to make
Loans hereunder shall automatically terminate and the Obligations shall
immediately become due and payable without any election or action on the part of
the Agent or any Lender. If any other Default occurs, the Required Lenders (or
the Agent with the consent of the Required Lenders) may terminate or suspend the
obligations of the Lenders to make Loans hereunder, or declare the Obligations
to be due and payable, or both, whereupon the Obligations shall become
immediately due and payable, without presentment, demand, protest or notice of
any kind, all of which the Borrower hereby expressly waives.
If, within 30 days after acceleration of the maturity of the
Obligations or termination of the obligations of the Lenders to make Loans
hereunder as a result of any Default (other than any Default as described in
Section 7.6 or 7.7 with respect to the Borrower) and before any judgment or
decree for the payment of the Obligations due shall have been obtained or
entered, the Required Lenders (in their sole discretion) shall so direct, the
Agent shall, by notice to the Borrower, rescind and annul such acceleration
and/or termination.
8.2. Amendments. Subject to the provisions of this Article VIII,
the Required Lenders (or the Agent with the consent in writing of the Required
Lenders) and the Borrower may enter into agreements supplemental hereto for the
purpose of adding or modifying any provisions to the Loan Documents or changing
in any manner the rights of the Lenders or the Borrower hereunder or waiving any
Default hereunder; provided, however, that no such supplemental agreement shall,
without the consent of all of the Lenders:
49
(i) Extend the final maturity of any Loan, or postpone any
regularly scheduled payment of principal of any Loan, or
forgive all or any portion of the principal amount thereof, or
reduce the rate or extend the time of payment of interest or
fees thereon.
(ii) Reduce the percentage specified in the definition of Required
Lenders.
(iii) Extend the Revolving Credit Facility Termination Date, or
reduce the amount or extend the payment date for, the
mandatory payments required under Section 2.3, or increase the
amount of any Commitment of any Lender hereunder, or permit
the Borrower to assign its rights under this Agreement.
(iv) Amend this Section 8.2.
No amendment of any provision of this Agreement relating to the Agent shall be
effective without the written consent of the Agent. The Agent may waive payment
of the fee required under Section 12.3.2 without obtaining the consent of any
other party to this Agreement.
8.3. Preservation of Rights. No delay or omission of the Lenders
or the Agent to exercise any right under the Loan Documents shall impair such
right or be construed to be a waiver of any Default or an acquiescence therein,
and the making of a Loan notwithstanding the existence of a Default or the
inability of the Borrower to satisfy the conditions precedent to such Loan shall
not constitute any waiver or acquiescence. Any single or partial exercise of any
such right shall not preclude other or further exercise thereof or the exercise
of any other right, and no waiver, amendment or other variation of the terms,
conditions or provisions of the Loan Documents whatsoever shall be valid unless
in writing signed by the Lenders required pursuant to Section 8.2, and then only
to the extent in such writing specifically set forth. All remedies contained in
the Loan Documents or by law afforded shall be cumulative and all shall be
available to the Agent and the Lenders until the Obligations have been paid in
full.
ARTICLE IX
GENERAL PROVISIONS
9.1. Survival of Representations. All representations and
warranties of the Borrower contained in this Agreement shall survive the making
of the Loans herein contemplated.
9.2. Governmental Regulation. Anything contained in this Agreement
to the contrary notwithstanding, no Lender shall be obligated to extend credit
to the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
9.3. Entire Agreement. This Agreement, the Fee Letter and the other
Loan Documents referred to herein embody the entire agreement and understanding
among the Borrower, the Agent and the Lenders and supersede all prior agreements
and understandings among the Borrower, the Agent and the Lenders relating to the
subject matter thereof. Without limiting the generality of the foregoing, it is
expressly agreed that the terms and conditions of this Agreement
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shall supersede and replace the terms and conditions of the Existing Credit
Agreement for all relevant time periods from and after the Effective Date, and
from and after the Effective Date the financial covenants set forth in 6.24
shall supersede and replace the financial covenants set forth in the Existing
Credit Agreement.
9.4. Several Obligations; Benefits of this Agreement. The
respective obligations of the Lenders hereunder are several and not joint and no
Lender shall be the partner or agent of any other (except to the extent to which
the Agent is authorized to act as such). The failure of any Lender to perform
any of its obligations hereunder shall not relieve any other Lender from any of
its obligations hereunder. This Agreement shall not be construed so as to confer
any right or benefit upon any Person other than the parties to this Agreement
and their respective successors and assigns.
9.5. Expenses; Indemnification.
9.5.1. Expenses. The Borrower shall pay or reimburse the
Agent for any costs, internal charges and out-of-pocket expenses (including
attorneys' fees, filing and recording fees, real estate mortgage taxes,
appraisal fees, survey and survey update fees, and title insurance premiums and
related charges as well as the costs and expenses of any periodic field audits)
paid or incurred in connection with the preparation, negotiation, execution,
delivery, syndication, review, amendment, modification, and administration of
this Agreement and the other Loan Documents. The Borrower also agrees to
reimburse the Agent and the Lenders for any costs, internal charges and
out-of-pocket expenses (including attorneys' fees and time charges of attorneys
for the Agent and the Lenders, which attorneys may be employees of the Agent or
the Lenders) paid or incurred by the Agent or any Lender in connection with the
collection and enforcement of the Loan Documents. Expenses being reimbursed by
the Borrower under this Section include, without limitation, costs and expenses
incurred in connection with the Reports described in the following sentence. The
Borrower acknowledges that from time to time Bank One may prepare and may
distribute to the Lenders (but shall have no obligation or duty to prepare or to
distribute to the Lenders) certain audit reports (the "Reports") pertaining to
the Borrower's assets for internal use by Bank One from information furnished to
it by or on behalf of the Borrower, after Bank One has exercised its rights of
inspection pursuant to this Agreement.
9.5.2. Indemnification. The Borrower hereby further agrees
to indemnify the Agent, each Lender, their respective affiliates, and each of
their directors, officers and employees against all losses, claims, damages,
penalties, judgments, liabilities and expenses (including, without limitation,
all expenses of litigation or preparation therefor whether or not the Agent, any
Lender or any affiliate is a party thereto) which any of them may pay or incur
arising out of or relating to this Agreement, the other Loan Documents, the
transactions contemplated hereby or the direct or indirect application or
proposed application of the proceeds of any Loan hereunder except to the extent
that they are determined in a final non-appealable judgment by a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the party seeking indemnification.
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9.5.3 Survival. The obligations of the Borrower under this
Section 9.5 shall survive the termination of this Agreement.
9.6. Numbers of Documents. All statements, notices, closing
documents, and requests hereunder shall be furnished to the Agent with
sufficient counterparts so that the Agent may furnish one to each of the
Lenders.
9.7. Severability of Provisions. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
9.8. Nonliability of Lenders. The relationship between the
Borrower on the one hand and the Lenders and the Agent on the other hand shall
be solely that of borrower and lender. Neither the Agent nor any Lender shall
have any fiduciary responsibilities to the Borrower. Neither the Agent nor any
Lender undertakes any responsibility to the Borrower to review or inform the
Borrower of any matter in connection with any phase of the Borrower's business
or operations. The Borrower agrees that neither the Agent nor any Lender shall
have liability to the Borrower (whether sounding in tort, contract or otherwise)
for losses suffered by the Borrower in connection with, arising out of, or in
any way related to, the transactions contemplated and the relationship
established by the Loan Documents, or any act, omission or event occurring in
connection therewith, unless it is determined in a final non-appealable judgment
by a court of competent jurisdiction that such losses resulted from the gross
negligence or willful misconduct of the party from which recovery is sought.
Neither the Agent nor any Lender shall have any liability with respect to, and
the Borrower hereby waives, releases and agrees not to xxx for, any special,
indirect or consequential damages suffered by the Borrower in connection with,
arising out of, or in any way related to the Loan Documents or the transactions
contemplated thereby.
9.9. Confidentiality. Each Lender agrees to hold any confidential
information which it may receive from the Borrower pursuant to this Agreement in
confidence, except for disclosure (i) to its Affiliates and to other Lenders and
their respective Affiliates, (ii) to legal counsel, accountants, and other
professional advisors to such Lender or to a Transferee, (iii) to regulatory
officials, (iv) to any Person as requested pursuant to or as required by law,
regulation, or legal process, (v) to any Person in connection with any legal
proceeding to which such Lender is a party, (vi) to such Lender's direct or
indirect contractual counterparties in swap agreements or to legal counsel,
accountants and other professional advisors to such counterparties, and (vii)
permitted by Section 12.4.
9.10. Nonreliance. Each Lender hereby represents that it is not
relying on or looking to any margin stock (as defined in Regulation U of the
Board of Governors of the Federal Reserve System) for the repayment of the Loans
provided for herein.
9.11. Disclosure. The Borrower and each Lender hereby (i)
acknowledge and agree that Bank One and/or its Affiliates from time to time may
hold investments in, make other loans to or have other relationships with the
Borrower and its Affiliates, and (ii) waive any liability of Bank
52
One or such Affiliate of Bank One to the Borrower or any Lender, respectively,
arising out of or resulting from such investments, loans or relationships other
than liabilities arising out of the gross negligence or willful misconduct of
Bank One or its Affiliates.
ARTICLE X
THE AGENT
10.1. Appointment; Nature of Relationship. Bank One is hereby
appointed by each of the Lenders as its contractual representative (herein
referred to as the "Agent") hereunder and under each other Loan Document, and
each of the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
X. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the contractual representative
of the Lenders with only those duties as are expressly set forth in this
Agreement and the other Loan Documents. In its capacity as the Lenders'
contractual representative, the Agent (i) does not hereby assume any fiduciary
duties to any of the Lenders, (ii) is a "representative" of the Lenders within
the meaning of Section 1-9-102(72)(E) of the Uniform Commercial Code and (iii)
is acting as an independent contractor, the rights and duties of which are
limited to those expressly set forth in this Agreement and the other Loan
Documents. Each of the Lenders hereby agrees to assert no claim against the
Agent on any agency theory or any other theory of liability for breach of
fiduciary duty, all of which claims each Lender hereby waives.
10.2. Powers. The Agent shall have and may exercise such powers
under the Loan Documents as are specifically delegated to the Agent by the terms
of each thereof, together with such powers as are reasonably incidental thereto.
The Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
10.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
to the extent such action or inaction is determined in a final non-appealable
judgment by a court of competent jurisdiction to have arisen from the gross
negligence or willful misconduct of such Person.
10.4. No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents or employees shall be responsible for
or have any duty to ascertain, inquire into, or verify (a) any statement,
warranty or representation made in connection with any Loan Document or any
borrowing hereunder; (b) the performance or observance of any of the covenants
or agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (c) the satisfaction of any condition specified in Article IV, except
receipt of items required to be delivered solely to the Agent; (d) the existence
or possible existence of any Default or Unmatured Default; (e) the
53
validity, enforceability, effectiveness, sufficiency or genuineness of any Loan
Document or any other instrument or writing furnished in connection therewith;
(f) the value, sufficiency, creation, perfection or priority of any Lien in any
collateral security; or (g) the financial condition of the Borrower or any
guarantor of any of the Obligations or of any of the Borrower's or any such
guarantor's respective Subsidiaries. The Agent shall have no duty to disclose to
the Lenders information that is not required to be furnished by the Borrower to
the Agent at such time, but is voluntarily furnished by the Borrower to the
Agent (either in its capacity as Agent or in its individual capacity).
10.5. Action on Instructions of Lenders. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Loan Document in accordance with written instructions signed by
the Required Lenders, and such instructions and any action taken or failure to
act pursuant thereto shall be binding on all of the Lenders. The Lenders hereby
acknowledge that the Agent shall be under no duty to take any discretionary
action permitted to be taken by it pursuant to the provisions of this Agreement
or any other Loan Document unless it shall be requested in writing to do so by
the Required Lenders. The Agent shall be fully justified in failing or refusing
to take any action hereunder and under any other Loan Document unless it shall
first be indemnified to its satisfaction by the Lenders, based upon their Pro
Rata Shares, against any and all liability, cost and expense that it may incur
by reason of taking or continuing to take any such action.
10.6. Employment of Agents and Counsel. The Agent may execute any
of its duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning the contractual arrangement between the Agent and the Lenders
and all matters pertaining to the Agent's duties hereunder and under any other
Loan Document.
10.7. Reliance on Documents; Counsel. The Agent shall be entitled
to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in respect
to legal matters, upon the opinion of counsel selected by the Agent, which
counsel may be employees of the Agent.
10.8. Agent's Reimbursement and Indemnification. The Lenders agree
to reimburse and indemnify the Agent in proportion to their Pro Rata Shares (i)
for any amounts not reimbursed by the Borrower for which the Agent is entitled
to reimbursement by the Borrower under the Loan Documents, (ii) for any other
expenses incurred by the Agent on behalf of the Lenders, in connection with the
preparation, execution, delivery, administration and enforcement of the Loan
Documents (including, without limitation, for any expenses incurred by the Agent
in connection with any dispute between the Agent and any Lender or between two
or more of the Lenders) and (iii) for any liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind and nature whatsoever which may be imposed on, incurred by or
asserted against the Agent in any way relating to or arising out of the Loan
Documents or any other document delivered in connection therewith or the
transactions
54
contemplated thereby (including, without limitation, for any such amounts
incurred by or asserted against the Agent in connection with any dispute between
the Agent and any Lender or between two or more of the Lenders), or the
enforcement of any of the terms of the Loan Documents or of any such other
documents, provided that (x) no Lender shall be liable for any of the foregoing
to the extent any of the foregoing is found in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from the gross negligence
or willful misconduct of the Agent and (y) any indemnification required pursuant
to Section 3.5(vii) shall, notwithstanding the provisions of this Section 10.8,
be paid by the relevant Lender in accordance with the provisions thereof. The
obligations of the Lenders under this Section 10.8 shall survive payment of the
Obligations and termination of this Agreement.
10.9. Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder unless the Agent has received written notice from a Lender or the
Borrower referring to this Agreement describing such Default or Unmatured
Default and stating that such notice is a "notice of default". In the event that
the Agent receives such a notice, the Agent shall give prompt notice thereof to
the Lenders.
10.10. Rights as a Lender. The Agent shall be a Lender, and as such
the Agent shall have the same rights and powers hereunder and under any other
Loan Document with respect to its Commitment and its Loans as any other Lender
and may exercise the same as though it were not the Agent, and the term "Lender"
or "Lenders" shall, at any time when the Agent is a Lender, unless the context
otherwise indicates, include the Agent in its individual capacity. The Agent and
its Affiliates may accept deposits from, lend money to, and generally engage in
any kind of trust, debt, equity or other transaction, in addition to those
contemplated by this Agreement or any other Loan Document, with the Borrower or
any of its Subsidiaries in which the Borrower or such Subsidiary is not
restricted hereby from engaging with any other Person.
10.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by the Borrower and such other documents
and information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
10.12. Successor Agent. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower, such resignation to be
effective upon the appointment of a successor Agent or, if no successor Agent
has been appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. The Agent may be removed at any time with or without cause
by written notice received by the Agent from the Required Lenders, such removal
to be effective on the date specified by the Required Lenders. Upon any such
resignation or removal, the Required Lenders shall have the right to appoint, on
behalf of the Borrower and the Lenders, a successor Agent. If no successor Agent
shall have been so appointed by the Required Lenders within 30 days after the
resigning Agent's giving notice of its intention to resign, then the resigning
Agent may appoint, on behalf of the Borrower and the Lenders, a
55
successor Agent. Notwithstanding the previous sentence, the Agent may at any
time without the consent of the Borrower or any Lender, appoint any of its
Affiliates which is a commercial bank as a successor Agent hereunder. If the
Agent has resigned or been removed and no successor Agent has been appointed,
the Lenders may perform all the duties of the Agent hereunder and the Borrower
shall make all payments in respect of the Obligations to the applicable Lender
and for all other purposes shall deal directly with the Lenders. No successor
Agent shall be deemed to be appointed hereunder until such successor Agent has
accepted the appointment. Any such successor Agent shall be a commercial bank
having capital and retained earnings of at least $100,000,000. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the resigning or removed Agent. Upon
the effectiveness of the resignation or removal of the Agent, the resigning or
removed Agent shall be discharged from its duties and obligations hereunder and
under the Loan Documents. After the effectiveness of the resignation or removal
of an Agent, the provisions of this Article X shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents. In the event that there is a successor to the Agent by merger, or the
Agent assigns its duties and obligations to an Affiliate pursuant to this
Section 10.12, then the term "Corporate Base Rate" as used in this Agreement
shall mean the prime rate, base rate or other analogous rate of the new Agent.
10.13. Agent's Fee. The Borrower agrees to pay to the Agent, for its
own account, the fees agreed to be paid by the Borrower pursuant to the Fee
Letter, or as otherwise agreed from time to time.
10.14. Delegation to Affiliates. The Borrower and the Lenders agree
that the Agent may delegate any of its duties under this Agreement to any of its
Affiliates. Any such Affiliate (and such Affiliate's directors, officers, agents
and employees) which performs duties in connection with this Agreement shall be
entitled to the same benefits of the indemnification, waiver and other
protective provisions to which the Agent is entitled under Articles IX and X.
10.15. Collateral Releases. The Lenders hereby empower and authorize
the Agent to execute and deliver to the Borrower on their behalf any agreements,
documents or instruments as shall be necessary or appropriate to effect any
releases of Collateral which shall be permitted by the terms hereof or of any
other Loan Document or which shall otherwise have been approved by the Required
Lenders (or, if required by the terms of Section 8.2, all of the Lenders) in
writing.
ARTICLE XI
SETOFF; RATABLE PAYMENTS
11.1. Setoff. In addition to, and without limitation of, any rights
of the Lenders under applicable law, if the Borrower becomes insolvent, however
evidenced, or any Default occurs, any and all deposits (including all account
balances, whether provisional or final and whether or not collected or
available) and any other Indebtedness at any time held or owing by any Lender or
any Affiliate of any Lender to or for the credit or account of the Borrower may
be offset and applied toward the payment of the Obligations owing to such
Lender, whether or not the Obligations, or any part thereof, shall then be due.
56
11.2. Ratable Payments. If any Lender, whether by setoff or
otherwise, has payment made to it upon its Loans (other than payments received
pursuant to Section 3.1, 3.2, 3.4 or 3.5) in a greater proportion than that
received by any other Lender, such Lender agrees, promptly upon demand, to
purchase a portion of the Loans held by the other Lenders so that after such
purchase each Lender will hold its ratable proportion of Loans. If any Lender,
whether in connection with setoff or amounts which might be subject to setoff or
otherwise, receives collateral or other protection for its Obligations or such
amounts which may be subject to setoff, such Lender agrees, promptly upon
demand, to take such action necessary such that all Lenders share in the
benefits of such collateral ratably in proportion to their Loans. In case any
such payment is disturbed by legal process, or otherwise, appropriate further
adjustments shall be made.
ARTICLE XII
BENEFIT OF AGREEMENT; ASSIGNMENTS; PARTICIPATIONS
12.1. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower and the
Lenders and their respective successors and assigns, except that (i) the
Borrower shall not have the right to assign its rights or obligations under the
Loan Documents and (ii) any assignment by any Lender must be made in compliance
with Section 12.3. The parties to this Agreement acknowledge that clause (ii) of
this Section 12.1 relates only to absolute assignments and does not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by any Lender of all or any portion of its rights under
this Agreement and any Note to a Federal Reserve Bank; provided, however, that
no such pledge or assignment creating a security interest shall release the
transferor Lender from its obligations hereunder unless and until the parties
thereto have complied with the provisions of Section 12.3. The Agent may treat
the Person which made any Loan or which holds any Note as the owner thereof for
all purposes hereof unless and until such Person complies with Section 12.3;
provided, however, that the Agent may in its discretion (but shall not be
required to) follow instructions from the Person which made any Loan or which
holds any Note to direct payments relating to such Loan or Note to another
Person. Any assignee of the rights to any Loan or any Note agrees by acceptance
of such assignment to be bound by all the terms and provisions of the Loan
Documents. Any request, authority or consent of any Person, who at the time of
making such request or giving such authority or consent is the owner of the
rights to any Loan (whether or not a Note has been issued in evidence thereof),
shall be conclusive and binding on any subsequent holder or assignee of the
rights to such Loan.
12.2. Participations.
12.2.1. Permitted Participants; Effect. Any Lender may, in
the ordinary course of its business and in accordance with applicable
law, at any time sell to one or more banks or other entities
("Participants") participating interests in any Loan owing to such
Lender, any Note held by such Lender, any Commitment of such Lender or
any other interest of such Lender under the Loan Documents. In the
event of any such sale by a Lender of participating interests to a
Participant, such Lender's obligations under the Loan Documents shall
remain unchanged, such Lender shall remain solely responsible to the
57
other parties hereto for the performance of such obligations, such
Lender shall remain the owner of its Loans and the holder of any Note
issued to it in evidence thereof for all purposes under the Loan
Documents, all amounts payable by the Borrower under this Agreement
shall be determined as if such Lender had not sold such participating
interests, and the Borrower and the Agent shall continue to deal solely
and directly with such Lender in connection with such Lender's rights
and obligations under the Loan Documents.
12.2.2. Voting Rights. Each Lender shall retain the sole
right to approve, without the consent of any Participant, any
amendment, modification or waiver of any provision of the Loan
Documents other than any amendment, modification or waiver with respect
to any Loan or Commitment in which such Participant has an interest
which forgives principal, interest or fees or reduces the interest rate
or fees payable with respect to any such Loan or Commitment, extends
the Revolving Credit Facility Termination Date, postpones any date
fixed for any regularly-scheduled payment of principal of, or interest
or fees on, any such Loan or Commitment, releases any guarantor of any
such Loan or releases all or substantially all of the collateral, if
any, securing any such Loan.
12.2.3. Benefit of Setoff. The Borrower agrees that each
Participant shall be deemed to have the right of setoff provided in
Section 11.1 in respect of its participating interest in amounts owing
under the Loan Documents to the same extent as if the amount of its
participating interest were owing directly to it as a Lender under the
Loan Documents, provided that each Lender shall retain the right of
setoff provided in Section 11.1 with respect to the amount of
participating interests sold to each Participant. The Lenders agree to
share with each Participant, and each Participant, by exercising the
right of setoff provided in Section 11.1, agrees to share with each
Lender, any amount received pursuant to the exercise of its right of
setoff, such amounts to be shared in accordance with Section 11.2 as if
each Participant were a Lender.
12.3. Assignments.
12.3.1. Permitted Assignments. Any Lender may, in the
ordinary course of its business and in accordance with applicable law,
at any time assign to one or more banks or other entities
("Purchasers") all or any part of its rights and obligations under the
Loan Documents; provided, however, that each Purchaser must purchase
the same Pro Rata Share in each of the Revolving Credit Facility, the
Term Loan Facility and the R/E Term Loan Facility. Such assignment
shall be substantially in the form of Exhibit "D" or in such other form
as may be agreed to by the parties thereto. The consent of the Borrower
and the Agent shall be required prior to an assignment becoming
effective with respect to a Purchaser which is not a Lender or an
Affiliate thereof; provided, however, that if a Default has occurred
and is continuing, the consent of the Borrower shall not be required.
Such consent shall not be unreasonably withheld or delayed. Each such
assignment with respect to a Purchaser which is not a Lender or an
Affiliate thereof shall (unless each of the Borrower and the Agent
otherwise consents) be in an amount not less than the lesser of (i)
$5,000,000 or (ii) the remaining amount of the assigning Lender's total
58
Commitment (calculated as at the date of such assignment) or its
outstanding Loans (if all of the applicable Commitments have been
terminated).
12.3.2. Effect; Effective Date. Upon (i) delivery to the
Agent of an assignment, together with any consents required by Section
12.3.1, and (ii) payment of a $4,000 fee to the Agent for processing
such assignment (unless such fee is waived by the Agent), such
assignment shall become effective on the effective date specified in
such assignment. The assignment shall contain a representation by the
Purchaser to the effect that none of the consideration used to make the
purchase of the Commitment and Loans under the applicable
assignment
agreement constitutes "plan assets" as defined under ERISA and that the
rights and interests of the Purchaser in and under the Loan Documents
will not be "plan assets" under ERISA. On and after the effective date
of such assignment, such Purchaser shall for all purposes be a Lender
party to this Agreement and any other Loan Document executed by or on
behalf of the Lenders and shall have all the rights and obligations of
a Lender under the Loan Documents, to the same extent as if it were an
original party hereto, and no further consent or action by the
Borrower, the Lenders or the Agent shall be required to release the
transferor Lender with respect to the percentage of the Aggregate
Commitment and Loans assigned to such Purchaser. Upon the consummation
of any assignment to a Purchaser pursuant to this Section 12.3.2, the
transferor Lender, the Agent and the Borrower shall, if the transferor
Lender or the Purchaser desires that its Loans be evidenced by Notes,
make appropriate arrangements so that new Notes or, as appropriate,
replacement Notes are issued to such transferor Lender and new Notes
or, as appropriate, replacement Notes, are issued to such Purchaser, in
each case in principal amounts reflecting their respective Commitments,
as adjusted pursuant to such assignment.
12.4. Dissemination of Information. The Borrower authorizes each
Lender to disclose to any Participant or Purchaser or any other Person acquiring
an interest in the Loan Documents by operation of law (each a "Transferee") and
any prospective Transferee any and all information in such Lender's possession
concerning the creditworthiness of the Borrower and its Subsidiaries, including
without limitation any information contained in any Reports; provided that each
Transferee and prospective Transferee agrees to be bound by Section 9.11 of this
Agreement.
12.5. Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 3.5(iv).
ARTICLE XIII
NOTICES
13.1. Notices. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices, requests and other communications to
any party hereunder shall be in writing (including electronic transmission,
facsimile transmission or similar writing) and shall be given to such party: (x)
in the case of the Borrower, any of the initial Lenders or the Agent, at its
address or facsimile number set forth on the signature pages hereof, (y) in the
case of any Person
59
who hereafter becomes a Lender, at its address or facsimile number set forth
below in its administrative questionnaire or (z) in the case of any party, at
such other address or facsimile number as such party may hereafter specify for
the purpose by notice to the Agent and the Borrower in accordance with the
provisions of this Section 13.1. Each such notice, request or other
communication shall be effective (i) if given by facsimile transmission, when
transmitted to the facsimile number specified in accordance with this Section
13.1 and confirmation of receipt is received, (ii) if given by mail, 72 hours
after such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid, or (iii) if given by any other means, when
delivered (or, in the case of electronic transmission, received) at the address
specified in this Section; provided that notices to the Agent under Article II
shall not be effective until received.
13.2. Change of Address. The Borrower, the Agent and any Lender may
each change the address for service of notice upon it by a notice in writing to
the other parties hereto.
ARTICLE XIV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Agent and the Lenders and each party has notified the Agent by facsimile
transmission or telephone that it has taken such action.
ARTICLE XV
CHOICE OF LAW; CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL
15.1. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE
CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (WITHOUT REGARD TO THE CONFLICT OF LAWS
PROVISIONS) OF THE STATE OF
OKLAHOMA, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.
15.2. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR
OKLAHOMA STATE COURT SITTING IN TULSA,
OKLAHOMA, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENTS AND THE BORROWER HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT FORUM.
NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY LENDER TO BRING
PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY
60
OTHER JURISDICTION. ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR
ANY LENDER OR ANY AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH
ANY LOAN DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN TULSA,
OKLAHOMA.
15.3. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.
SIGNATURES APPEAR ON FOLLOWING PAGE.]
61
IN WITNESS WHEREOF, the Borrower, the Lenders and the Agent have
executed this Agreement as of the date first above written.
XETA TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Title: Secretary and Chief Financial Officer
0000 X. Xxxxxx
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
Revolving Loan Commitment: BANK ONE, OKLAHOMA, N.A.,
$ 4,950,000.00 Individually and as Agent
Term Loan Commitment: By: /s/ Xxxxxxx X. Xxxxx
$ 8,575,427.55 ----------------------------------------
Title: Vice President
R/E Term Loan Commitment:
$ 1,402,500.00 Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
FAX: (000) 000-0000
Address: 00 Xxxx Xxxxx Xxxxxx
Xxxxx, Xxxxxxxx 00000
Revolving Loan Commitment: FIRSTAR BANK, N.A.
$ 4,050,000.00
Term Loan Commitment: By: /s/ Xxxxxxx X. Xxxxxxxxx, Xx.
$ 7,016,258.91 -----------------------------------------
Title: Vice President
R/E Term Loan Commitment:
$ 1,147,500.00 Attention: Xxxxxxx X. Xxxxxxxxx, Xx.
Telephone: (000) 000-0000
FAX: (000) 000-0000
Address: 000 Xxxxxx Xxxxxx
Xxxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Total Commitments:
$ 27,141,686.46
================
62
CONSENT OF GUARANTOR
The undersigned hereby (i) acknowledges and consents to the execution
and delivery of the above and foregoing Amended and Restated Credit Agreement
("Credit Agreement"), (ii) confirms that the Guaranty of the undersigned will
continue in full force and effect as security for payment and performance of all
of the "Guaranteed Obligations," as such term is used in the Guaranty, including
all Loans from time to time outstanding under the Facilities, and (iii) ratifies
and reaffirms the Guaranty.
No inference shall be drawn from the undersigned's execution of this
Consent that consent or approval of the undersigned is required for this or any
future modification or amendment of or supplement to the Credit Agreement or
other Loan Document, or for this or any future increase, extension or renewal of
the Guaranteed Obligations.
Capitalized terms used in this Consent and not otherwise defined have
the respective meanings assigned to them in the Credit Agreement.
U.S. TECHNOLOGIES SYSTEMS, INC.
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
---------------------------------------
Title: VP
--------------------------------------
63
PRICING SCHEDULE
====================================================== =================== ==================== ====================
REVOLVING LOANS APPLICABLE MARGIN LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS
------------------------------------------------------ ------------------- -------------------- --------------------
Eurodollar Rate 1.75% 2.25% 2.75%
------------------------------------------------------ ------------------- -------------------- --------------------
Floating Rate (1.00)% (0.50)% 0.00%
====================================================== =================== ==================== ====================
====================================================== =================== ==================== ====================
TERM LOANS APPLICABLE MARGIN LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS
------------------------------------------------------ ------------------- -------------------- --------------------
Eurodollar Rate 2.25% 2.75% 3.25%
------------------------------------------------------ ------------------- -------------------- --------------------
Floating Rate (0.50)% 0.00% 0.50%
====================================================== =================== ==================== ====================
====================================================== =================== ==================== ====================
R/E TERM LOANS APPLICABLE MARGIN LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS
------------------------------------------------------ ------------------- -------------------- ---------------------
Eurodollar Rate 1.25% 1.75% 2.25%
------------------------------------------------------ ------------------- -------------------- ---------------------
Floating Rate (1.50)% (1.00)% (0.50)%
====================================================== =================== ==================== =====================
====================================================== =================== ==================== ====================
APPLICABLE FEE RATE LEVEL I STATUS LEVEL II STATUS LEVEL III STATUS
====================================================== =================== ==================== =====================
Commitment Fee 0.35% 0.40% 0.45%
====================================================== =================== ==================== =====================
For the purposes of this Schedule, the following terms have the
following meanings:
"Financials" means the annual or quarterly financial statements of the
Borrower delivered pursuant to Section 6.1(i) or (ii).
"Level I Status" exists at any date if, as of the last day of each of
the four fiscal quarters of the Borrower immediately preceding such date, the
Consolidated Debt Service Coverage Ratio was 1.20 to 1.00 or greater.
"Level II Status" exists at any date if, as of the last day of each of
the two fiscal quarters of the Borrower immediately preceding such date, the
Consolidated Debt Service Coverage Ratio was 1.20 to 1.00 or greater.
"Level III Status" exists at any date if the Borrower has not qualified
for Level I Status or Level II Status.
64
"Status" means either Level I Status, Level II Status or Level III
Status.
The Applicable Margin and Applicable Fee Rate shall be determined in
accordance with the foregoing table based on the Borrower's Status as reflected
in the then most recent Financials. Adjustments, if any, to the Applicable
Margin and Applicable Fee Rate shall be effective five Business Days after the
Agent has received the applicable Financials. If the Borrower fails to deliver
the Financials to the Agent at the time required pursuant to Section 6.1, then
the Applicable Margin and Applicable Fee Rate shall be the highest Applicable
Margin and Applicable Fee Rate set forth in the foregoing table until five days
after such Financials are so delivered.
If the Borrower is at Level I Status or Level II Status and then fails
to maintain a Consolidated Debt Service Coverage Ratio of at least 1.20 to 1.00
for any fiscal quarter, the Borrower's Status will fall to Level III and will
remain at Level III Status until such time as the Borrower has satisfied the
criteria stated above for Level I Status or Level II Status.
At the Effective Date, the Borrower's Status is Level III Status.
65
EXHIBIT A
FORM OF OPINION OF COUNSEL
October 31, 2001
The Agent and the Lenders who are parties to the
Credit Agreement described below.
Gentlemen/Ladies:
We are counsel for XETA Technologies, Inc., an Oklahoma corporation
(the "Borrower"), and United States Technologies Systems, Inc., a Missouri
corporation and wholly-owned subsidiary of Borrower ("UST"; hereinafter Borrower
and UST may be collectively referred to herein as "Obligors" or individually as
an "Obligor"), and have represented the Obligors in connection with the closing
of the transactions contemplated by that certain Amended and Restated Credit
Agreement dated as of October 31, 2001 (the "Credit Agreement") among the
Borrower, the Lenders named therein, and Bank One, Oklahoma, N.A., as Agent. All
capitalized terms used in this opinion and not otherwise defined herein shall
have the meanings attributed to them in the Credit Agreement.
We have examined each of the Obligors' **[describe constitutive
documents of Borrower and appropriate evidence of authority to enter into the
transaction]**, the Loan Documents to which each of the Obligors is a party and
such other matters of fact and law that we deem necessary in order to render
this opinion. Based upon the foregoing, it is our opinion that:
l. Each of the Obligors is a corporation, duly organized, validly
existing and in good standing under the laws of its respective state of
incorporation and has all requisite authority and is duly qualified or licensed
to conduct its businesses in each jurisdiction in which it owns any Property or
conducts any business (except where failure to be so qualified or licensed could
not reasonably be expected to have a Material Adverse Effect or result in the
forfeiture of any Property).
2. As of the date hereof, UST is a wholly-owned subsidiary of the
Borrower. All of the issued and outstanding stock of UST have been duly
authorized and issued and are fully paid and non-assessable.
3. The execution and delivery by the Obligors of the respective
Loan Documents to which each is a party and the performance by the Obligors of
their respective obligations thereunder have been duly authorized by proper
corporate proceedings on the part of each Obligor and will not:
(a) require any consent of either of the Obligors'
shareholders (other than any such consent as has already been given and
remains in full force and effect);
(b) violate (i) any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on either of the
Obligors, or (ii) either of the Obligors' articles or certificates of
incorporation or by-laws, or (iii) the provisions of any indenture,
instrument or agreement to which either of the Obligors is a party or
is subject, or by which it, or its Property, is bound, or conflict with
or constitute a default thereunder; or
(c) result in, or require, the creation or imposition of
any Lien in, of or on the Property of either of the Obligors pursuant
to the terms of any indenture, instrument or agreement binding upon
either of the Obligors.
4. The Loan Documents to which each Obligor is a party have been
duly executed and delivered by the applicable Obligor and constitute legal,
valid and binding obligations of that Obligor, enforceable against that Obligor
in accordance with their terms except to the extent the enforcement thereof may
be limited by bankruptcy, insolvency or similar laws affecting the enforcement
of creditors' rights generally and subject also to the availability of equitable
remedies if equitable remedies are sought.
5. There is no litigation, arbitration, governmental
investigation, proceeding or inquiry pending or, to the best of our knowledge
after due inquiry, threatened against either of the Obligors which, if adversely
determined, could reasonably be expected to have a Material Adverse Effect.
6. No order, consent, adjudication, approval, license,
authorization, or validation of, or filing, recording or registration with, or
exemption by, or other action in respect of any governmental or public body or
authority, or any subdivision thereof, which has not been obtained by either of
the Obligors, is required to be obtained by either of the Obligors in connection
with the execution and delivery of the Loan Documents to which either of the
Obligors is a party, the borrowings under the Credit Agreement, the payment and
performance by either of the Obligors of the Obligations, or the legality,
validity, binding effect or enforceability of any of the Loan Documents to which
either of the Obligors is a party.
This opinion may be relied upon by the Agent, the Lenders and their
participants, assignees and other transferees.
Very truly yours,
2
EXHIBIT B
XETA TECHNOLOGIES, INC.
FINANCIAL COVENANT COMPLIANCE CERTIFICATE
(Due quarterly within 45 days of quarter end.)
As of:
------------------
To: Bank One, Oklahoma
The undersigned hereby submits this quarterly compliance certificate pursuant to
the October 31, 2001 Amended and Restated Credit Agreement (the "Credit
Agreement"); certifies that the Borrower(s) specified in the Credit Agreement
are not in default under the terms and provisions thereof; and further certifies
the following financial covenant compliance calculations required by the Credit
Agreement:
1. MINIMUM CURRENT RATIO
(Required: Not less than 1.1:1.0)
a. Current Assets $
------------
Divided By
b. Current Liabilities $
------------
EQUALS CURRENT RATIO (1a. DIVIDED BY 1b.)
1.
-----------
2. MINIMUM CONSOLIDATED NET WORTH
(Required: Not less than Net Worth of $29,000,000 plus 75% of
Consolidated Net Income earned in each fiscal quarter beginning with
quarter ending January 31, 2002 plus 100% of net proceeds from any
equity offering.)
a. Consolidated Net Worth Floor $29,000,000
Plus
b. 75% of Net Income earned since closing date $
Plus ----------
c. 100% of net proceeds from equity offering $
----------
EQUALS TOTAL CONSOLIDATED NET WORTH (2a. PLUS 2b. PLUS 2c.)
2.
------------
3. MINIMUM DEBT SERVICE COVERAGE RATIO
(Required: not less than 1.15:1.0 through 7-31-02 and 1.20:1 thereafter)
The following determined as of the most recently ended four quarters on
a Consolidated basis:
Net Income $
Plus ------------
Depreciation and Amortization $
Plus ------------
Interest Expense $
Minus ------------
Unfunded Capital Expenditures $
Minus ------------
Dividends Paid or Declared $
Equals ------------
a. Cash Flow Available for Debt Service $
-----------
Current Maturities of Long Term
Funded Indebtedness $
Plus ------------
Interest Expense $
Equals ------------
b. Total Debt Service Requirements $
-----------
Debt Service Coverage Ratio (3a. divided by 3b.) 3.
-----------
4. MAXIMUM LEVERAGE RATIO
(Required: Not greater than 2.75:1.0 through 7-31-02 and 2.50:1
thereafter)
a. Consolidated Funded Indebtedness $
------------
The following determined as of the most recently ended four quarters on a
Consolidated basis:
Net Income $
Plus ------------
Interest $
Plus ------------
Tax Expense $
Plus ------------
Depreciation and Amortization $
Equals ------------
b. Consolidated EBITDA $
------------
Leverage Ratio (4a. divided by 4b.) 4.
------------
5. MAXIMUM CAPITAL EXPENDITURE CEILING 5.
Calculated at fiscal year end only: ------------
(Required: Not greater than $1,000,000 during any fiscal year)
2
Executed and delivered to the Bank this __ day of _____________, 2001.
XETA TECHNOLOGIES, INC.
By:
--------------------------------------
Xxxxxx Xxxxxx, Chief Financial Officer
3
EXHIBIT C
XETA TECHNOLOGIES, INC.
BORROWING BASE CERTIFICATE
Xeta Technologies, Inc. is in compliance with the borrowing base requirements
and certifies that the information shown on the attached Borrowing Base
Calculation worksheet is correct.
I hereby certify that as of __________,20__, the borrowing base totaled
$____________, as shown on the attached Borrowing Base Calculation worksheet.
----------------------------------
Xxxxxx Xxxxxx, CFO
Attachments to this Certificate: Borrowing Base Calculation worksheet,
receivable aging report, payable listing, inventory report
E-mail the Borrowing Base workbook to Xxxxx Xxxxxx at:
Xxxxx_X_Xxxxxx@xxxxxxx.xxx.
BORROWING BASE CALCULATION WORKSHEET
Borrowing Base Calculation XETA Technologies, Inc
DATE: Type date here
Total Accounts Receivable $0.00
Invoices over 90 days old $0.00
Contra Accounts $50.00
Affiliate Accounts $0.00
Pre-billed Accounts $0.00
Guaranteed, consigned, or other conditional sales $0.00
Foreign Accounts $0.00
U.S. Government accounts in excess of $250,000 $0.00
Amounts offset by customer deposits $0.00
Other Ineligibles specified by bank $0.00
Tainted Accounts $0.00
Excess Concentrations #VALUE!
Total Eligible A/R #VALUE!
Receivable Borrowing Base #VALUE!
Total Inventory $0.00
Less:
Obsolete $0.00
Inventory on consignment $0.00
Inventory held in warehouse 100 by Avaya $0.00
Inventory store in a public warehouse with no $0.00
warehouse agreement in place
Slow-moving inventory (inv. in excess of 1 year's usage) $0.00
Lodging Division's "spare parts" inventory $0.00
Eligible Inventory $0.00
Eligible Inventory X advance rate. $0.00
Inventory Borrowing Base (with cap applied) #VALUE!
Total Borrowing Base #VALUE!
Revolver Balance Outstanding $0.00
Letters of Credit $0.00
Other Adjustments to O/S (specify) $0.00
Total Outstanding $0.00
2
Available for Advance #VALUE!
Borrowing Base Parameters:
Note Amount $9,000,000.00
Maximum A/R eligibility days (60, 90, 120, etc.) 90 days old
Advance Rate - A/R 80.00%
Tainted rate 20.00%
Maximum Concentration Level 25.00%
Advance Rate - Inv 40.00%
Maximum Inventory BB as a % of total Borrowing 25.00%
Base (See cell nt)
3
EXHIBIT D
ASSIGNMENT AGREEMENT
This
Assignment Agreement (this "
Assignment Agreement") between
_______________________________ (the "Assignor") and ___________________________
(the "Assignee") is dated as of ______________________, 20 . The parties hereto
agree as follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to an Amended
and Restated Credit Agreement (which, as it may be amended, modified, renewed or
extended from time to time is herein called the "Credit Agreement") described in
Item 1 of Schedule 1 attached hereto ("Schedule 1"). Capitalized terms used
herein and not otherwise defined herein shall have the meanings attributed to
them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and
assigns to the Assignee, and the Assignee hereby purchases and assumes from the
Assignor, an interest in and to the Assignor's rights and obligations under the
Credit Agreement and the other Loan Documents, such that after giving effect to
such assignment the Assignee shall have purchased pursuant to this
Assignment
Agreement the percentage interest specified in Item 3 of Schedule 1 of all
outstanding rights and obligations under the Credit Agreement and the other Loan
Documents relating to the facilities listed in Item 3 of Schedule 1. The
aggregate Commitments (or Loans, if the applicable Commitments have been
terminated) purchased by the Assignee hereunder are set forth in Item 4 of
Schedule 1.
3. EFFECTIVE DATE. The effective date of this
Assignment
Agreement (the "Effective Date") shall be the later of the date specified in
Item 5 of Schedule 1 or two Business Days (or such shorter period agreed to by
the Agent) after this
Assignment Agreement, together with any consents required
under the Credit Agreement, are delivered to the Agent. In no event will the
Effective Date occur if the payments required to be made by the Assignee to the
Assignor on the Effective Date are not made on the proposed Effective Date.
4. PAYMENT OBLIGATIONS. In consideration for the sale and
assignment of Loans hereunder, the Assignee shall pay the Assignor, on the
Effective Date, the amount agreed to by the Assignor and the Assignee. On and
after the Effective Date, the Assignee shall be entitled to receive from the
Agent all payments of principal, interest and fees with respect to the interest
assigned hereby. The Assignee will promptly remit to the Assignor any interest
on Loans and fees received from the Agent which relate to the portion of the
Commitments or Loans assigned to the Assignee hereunder for periods prior to the
Effective Date and not previously paid by the Assignee to the Assignor. In the
event that either party hereto receives any payment to which the other party
hereto is entitled under this
Assignment Agreement, then the party receiving
such amount shall promptly remit it to the other party hereto.
5. RECORDATION FEE. The Assignor and Assignee each agree to pay
one-half of the recordation fee required to be paid to the Agent in connection
with this
Assignment Agreement unless otherwise specified in Item 6 of Schedule
1.
6. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that (i) it is the legal and
beneficial owner of the interest being assigned by it hereunder, (ii) such
interest is free and clear of any adverse claim created by the Assignor and
(iii) the execution and delivery of this Assignment Agreement by the Assignor is
duly authorized. It is understood and agreed that the assignment and assumption
hereunder are made without recourse to the Assignor and that the Assignor makes
no other representation or warranty of any kind to the Assignee. Neither the
Assignor nor any of its officers, directors, employees, agents or attorneys
shall be responsible for (i) the due execution, legality, validity,
enforceability, genuineness, sufficiency or collectability of any Loan Document,
including without limitation, documents granting the Assignor and the other
Lenders a security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or creditworthiness of the
Borrower or any guarantor, (iv) the performance of or compliance with any of the
terms or provisions of any of the Loan Documents, (v) inspecting any of the
property, books or records of the Borrower, (vi) the validity, enforceability,
perfection, priority, condition, value or sufficiency of any collateral securing
or purporting to secure the Loans or (vii) any mistake, error of judgment, or
action taken or omitted to be taken in connection with the Loans or the Loan
Documents.
7. REPRESENTATIONS AND UNDERTAKINGS OF THE ASSIGNEE. The
Assignee (i) confirms that it has received a copy of the Credit Agreement,
together with copies of the financial statements requested by the Assignee and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment Agreement, (ii)
agrees that it will, independently and without reliance upon the Agent, the
Assignor or any other Lender and based on such documents and information at it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Documents, (iii) appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under the Loan Documents as are delegated to the Agent by the terms
thereof, together with such powers as are reasonably incidental thereto, (iv)
confirms that the execution and delivery of this Assignment Agreement by the
Assignee is duly authorized, (v) agrees that it will perform in accordance with
their terms all of the obligations which by the terms of the Loan Documents are
required to be performed by it as a Lender, (vi) agrees that its payment
instructions and notice instructions are as set forth in the attachment to
Schedule 1, (vii) confirms that none of the funds, monies, assets or other
consideration being used to make the purchase and assumption hereunder are "plan
assets" as defined under ERISA and that its rights, benefits and interests in
and under the Loan Documents will not be "plan assets" under ERISA, (viii)
agrees to indemnify and hold the Assignor harmless against all losses, costs and
expenses (including, without limitation, reasonable attorneys' fees) and
liabilities incurred by the Assignor in connection with or arising in any manner
from the Assignee's non-performance of the obligations assumed under this
Assignment Agreement, and (ix) if applicable, attaches the forms prescribed by
the Internal Revenue Service of the United States certifying that the Assignee
is entitled to receive payments under the Loan Documents without deduction or
withholding of any United States federal income taxes.
8. GOVERNING LAW. This Assignment Agreement shall be governed by
the
2
internal law, and not the law of conflicts, of the State of Oklahoma.
9. NOTICES. Notices shall be given under this Assignment
Agreement in the manner set forth in the Credit Agreement. For the purpose
hereof, the addresses of the parties hereto (until notice of a change is
delivered) shall be the address set forth in the attachment to Schedule 1.
10. COUNTERPARTS; DELIVERY BY FACSIMILE. This Assignment
Agreement may be executed in counterparts. Transmission by facsimile of an
executed counterpart of this Assignment Agreement shall be deemed to constitute
due and sufficient delivery of such counterpart and such facsimile shall be
deemed to be an original counterpart of this Assignment Agreement.
IN WITNESS WHEREOF, the duly authorized officers of the parties hereto
have executed this Assignment Agreement by executing Schedule 1 hereto as of the
date first above written.
3
SCHEDULE 1
to Assignment Agreement
1. Description and Date of Credit Agreement: Amended and Restated Credit
Agreement dated as of October 31, 2001, among XETA Technologies, Inc.,
the Lenders, Bank One, Oklahoma, N.A., as Agent, and Banc One Capital
Markets, Inc.
2. Date of Assignment Agreement: ______________________, 20___
3. Amounts (As of Date of Item 2 above):
Revolving Credit Term Loan R/E Term
Facility Facility Facility
-------------------- --------------------- --------------------
a. Assignee's percentage of each
Facility purchased under the
Assignment Agreement (must be same
for each Facility)* % % %
-------- -------- -------
b. Amount of each Facility purchased
under the Assignment Agreement $ $ $
-------- -------- -------
4. Assignee's Commitment (or Loans with
respect to terminated Commitments)
purchased hereunder: $ $ $
-------- -------- -------
5. Proposed Effective Date:
------------------------
6. Non-standard Recordation Fee
Arrangement N/A*** [Assignor/Assignee to pay 100% of fee]
[Fee waived by Agent]
Accepted and Agreed:
[NAME OF ASSIGNOR] [NAME OF ASSIGNEE]
By: By:
-------------------------------- --------------------------------
Title: Title:
----------------------------- -----------------------------
ACCEPTED AND CONSENTED TO BY ACCEPTED AND CONSENTED TO BY
XETA TECHNOLOGIES, INC. BANK ONE, OKLAHOMA, N.A., as Agent
By: By:
-------------------------------- --------------------------------
Title: Title:
----------------------------- -----------------------------
* Percentage taken to 10 decimal places
** If fee is split 50-50, pick N/A as option
Attachment to SCHEDULE 1 to ASSIGNMENT AGREEMENT
ADMINISTRATIVE INFORMATION SHEET
Attach Assignor's Administrative Information Sheet, which must
include notice addresses for the Assignor and the Assignee
(Sample form shown below)
ASSIGNOR INFORMATION
CONTACT:
Name: Telephone No.:
-------------------------------- --------------------------
Fax No.: Telex No.:
----------------------------- ------------------------------
Answerback:
-----------------------------
PAYMENT INFORMATION:
Name & ABA # of Destination Bank:
----------------------------------------------
----------------------------------------------
Account Name & Number for Wire Transfer:
---------------------------------------
---------------------------------------
Other Instructions:
------------------------------------------------------------
-------------------------------------------------------------------------------
ADDRESS FOR NOTICES FOR ASSIGNOR:
----------------------------------------------
----------------------------------------------
----------------------------------------------
ASSIGNEE INFORMATION
CREDIT CONTACT:
Name: Telephone No.:
-------------------------------- --------------------------
Fax No.: Telex No.:
----------------------------- ------------------------------
Answerback:
-----------------------------
KEY OPERATIONS CONTACTS:
Booking Installation: Booking Installation:
---------------- -------------------
Name: Name:
-------------------------------- -----------------------------------
Telephone No.: Telephone No.:
----------------------- --------------------------
Fax No.: Fax No.:
----------------------------- --------------------------------
Telex No.: Telex No.:
--------------------------- ------------------------------
Answerback: Answerback:
-------------------------- -----------------------------
PAYMENT INFORMATION:
Name & ABA # of Destination Bank:
----------------------------------------------
----------------------------------------------
Account Name & Number for Wire Transfer:
---------------------------------------
---------------------------------------
Other Instructions:
------------------------------------------------------------
-------------------------------------------------------------------------------
ADDRESS FOR NOTICES FOR ASSIGNEE:
----------------------------------------------
----------------------------------------------
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2
BANK ONE INFORMATION
Assignee will be called promptly upon receipt of the signed agreement.
INITIAL FUNDING CONTACT: SUBSEQUENT OPERATIONS CONTACT:
Name: Xxx Xxxxx Name: Xxxx Xxxxxxxx
Telephone No.: (000) 000-0000 Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000 Fax No.: (000) 000-0000
Bank One Telex No.:
---------------------
(Answerback: )
---------------------------
INITIAL FUNDING STANDARDS:
Libor - Fund 2 days after rates are set.
BANK ONE WIRE INSTRUCTIONS: Bank One, Oklahoma, N.A., ABA # 000000000
Incoming Account # 66201510100007870
Ref: Xeta Technologies, Inc. OB# 623133303
ADDRESS FOR NOTICES FOR BANK ONE: 00 Xxxx Xxxxx Xxxxxx, Xxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxxxx
Telephone No.: (000) 000-0000
Fax No. (000) 000-0000
EXHIBIT E
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To Bank One, Oklahoma, N.A.,
as Agent (the "Agent") under the Credit Agreement
Described Below.
Re: Amended and Restated Credit Agreement dated as of October 31, 2001
(as amended, modified, renewed or extended from time to time, the
"Credit Agreement"), among XETA Technologies, Inc. (the "Borrower"),
the Lenders party thereto, and Bank One, Oklahoma, N.A., as Agent for
the Lenders. Capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned thereto in the Credit
Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 13.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s)
----------------------------------------------
Customer/Account Name
----------------------------------------------------------
Transfer Funds To
--------------------------------------------------------------
--------------------------------------------------------------
For Account No.
--------------------------------------------------------------
Reference/Attention To
--------------------------------------------------------
Authorized Officer (Customer Representative) Date
-----------------------------------------
-------------------------------------------- ---------------------------------------------
(Please Print) Signature
Bank Officer Name Date
-----------------------------------------
-------------------------------------------- ---------------------------------------------
(Please Print) Signature
(Deliver Completed Form to Credit Support Staff for Immediate Processing)
EXHIBIT F-1
REVOLVING NOTE
$ October 31, 2001
------------------------
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of ____________ (the "Lender"), the aggregate
unpaid principal amount of all Revolving Loans made by the Lender to the
Borrower pursuant to Section 2.1.1 of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The Borrower
shall pay the principal of and accrued and unpaid interest on the Revolving
Loans in full on the Revolving Credit Facility Termination Date and shall make
such mandatory payments as are required to be made under the terms of Article II
of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Revolving Loan and the date and amount of each
principal payment hereunder.
This Note is one of the Revolving Notes issued pursuant to, and is
entitled to the benefits of, the Amended and Restated Credit Agreement dated as
of October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the lenders
party thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent.
Capitalized terms used herein and not otherwise defined herein are used with the
meanings attributed to them in the Agreement. Reference is made to the Agreement
for a statement of the terms and conditions governing this Note, including the
terms and conditions under which this Note may be prepaid or its maturity date
accelerated.
This Note is secured pursuant to the Collateral Documents, as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered
to the Lender in renewal, extension and increase of and replacement for that
certain Revolving Note dated as of August 21, 2000, executed by the Borrower
payable to the order of the Lender in the stated principal amount of $_________
(the "Prior Note"). All liens and security interests in Property securing
payment of the Prior Note shall continue in full force and effect, uninterrupted
and unabated, as security for payment of this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
By:
---------------------------------------
Print Name:
-------------------------------
Title:
------------------------------------
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
REVOLVING NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
10-31-01
EXHIBIT F-2
TERM NOTE
$ October 31, 2001
------------------------ Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of __________________________________(the "Lender")
the aggregate unpaid principal amount of the Term Loan made by the Lender to the
undersigned pursuant to Section 2.1.2 of the Agreement (as hereinafter defined),
in immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The undersigned
shall pay the principal of and accrued and unpaid interest on the Term Loan in
full on October 31, 2003, and prior to maturity shall make such payments,
including mandatory prepayments, as are required to be made under the terms of
Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the Term Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Term Notes issued pursuant to, and is entitled
to the benefits of, the Amended and Restated Credit Agreement dated as of
October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the lenders
party thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent, to
which Agreement reference is hereby made for a statement of the terms and
conditions governing this Note, including the terms and conditions under which
this Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered
to the Lender to evidence a portion of the indebtedness outstanding under that
certain Term Note dated as of November 30, 1999, and that certain Acquisition
Term Note dated as of November 30, 2000, each executed by the Borrower payable
to the order of the Lender (collectively, the "Prior Term Notes"). All liens and
security interests in Property securing payment of the Prior Term Notes shall
continue in full force and effect, uninterrupted and unabated, as security for
this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
By:
---------------------------------------
Print Name:
-------------------------------
Title:
------------------------------------
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
10-31-01
EXHIBIT F-3
R/E TERM NOTE
$ October 31, 2001
------------------------ Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of __________________________________(the "Lender")
the aggregate unpaid principal amount of the R/E Term Loan made by the Lender to
the undersigned pursuant to Section 2.1.3 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Oklahoma, N.A., Tulsa, Oklahoma, as Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement. The undersigned shall pay the principal of and accrued and unpaid
interest on the R/E Term Loan in full on October 31, 2003, and prior to maturity
shall make such payments, including mandatory prepayments, as are required to be
made under the terms of Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the R/E Term Loan and the date and amount of each
principal payment hereunder.
This Note is one of the R/E Term Notes issued pursuant to, and is
entitled to the benefits of, the Amended and Restated Credit Agreement dated as
of October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the lenders
party thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent, to
which Agreement reference is hereby made for a statement of the terms and
conditions governing this Note, including the terms and conditions under which
this Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered
to the Lender to evidence a portion of the indebtedness outstanding under that
certain Acquisition Term Note dated November 30, 2000, executed by the Borrower
payable to the order of the Lender (the "Prior Note"). All liens and security
interests in Property securing payment of the Prior Note shall continue in full
force and effect, uninterrupted and unabated, as security for this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
By:
---------------------------------------
Print Name:
-------------------------------
Title:
------------------------------------
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
10-31-01
SCHEDULE 1
SUBSIDIARIES AND OTHER INVESTMENTS
(See Sections 5.8 and 6.14)
Investment Jurisdiction of Owned Amount of Percent
In Organization By Investment Ownership
---------- --------------- ----- ---------- ---------
U.S. Technologies Missouri XETA Technologies, $29 million 100%
Systems, Inc. Inc. (approx.)
XETACOM, Inc. Oklahoma XETA Technologies, Nominal 100%
(dormant) Inc.
SCHEDULE 2
INDEBTEDNESS AND LIENS
(See Sections 5.14, 6.11 and 6.15)
Maturity
Indebtedness Indebtedness Property and Amount
Incurred By Owed To Encumbered (If Any) of Indebtedness
------------ ------------ ------------------- ---------------
NONE
CERTIFICATE
This Certificate is executed and delivered by the undersigned in connection
with the execution and delivery of that certain Amended and Restated Credit
Agreement dated October 31, 2001 (the "Credit Agreement"), by and among the
XETA Technologies, Inc., as Borrower, the Lenders (as defined therein), and
Bank One, Oklahoma, NA, as Agent. Capitalized terms used herein but not
otherwise defined shall have the meaning assigned to them in the Credit
Agreement.
The undersigned, Xxxxxx X. Xxxxxx, hereby represents, warrants, and
certifies to the Bank as follows:
1. I am the Chief Financial Officer of the Borrower.
2. To the best of my knowledge, after diligent inquiry, on or as of
October 31, 2001:
a. no Default or Unmatured Default has occurred and is continuing;
b. the representations and warranties contained in Article V of the
Credit Agreement are true and correct; and
c. the Borrower has experienced no material adverse change in its
consolidated financial position since July 31, 2001.
EXECUTED AND DELIVERED this 31st day of October, 2001.
/s/ XXXXXX X. XXXXXX
---------------------------------------
Xxxxxx X. Xxxxxx,
Chief Financial Officer
BAILEE ACKNOWLEDGMENT
October 25, 2001
Bank One, Oklahoma, N.A.
------------------------------
------------------------------
Re: Xeta, Inc. ("Debtor")
Dear Sir or Madam:
We hereby acknowledge that, pursuant to our agreements with the Debtor,
from time to time we receive and maintain possession of certain of inventory of
the Debtor, which is kept at our premises located at: 0000 Xxxxxxx Xx,
Xxxxxxxxxx, XX 00000.
We further acknowledge that the Debtor has entered into a Security
Agreement with you and has granted to you a first priority security interest in
the inventory and proceeds thereof and the other types and items and collateral
therein described (collectively the "Collateral"), including inventory
presently in our possession and to be delivered to us in the future. We hereby
waive, surrender and relinquish any rights in or to the Collateral, including,
without limitation, any security interests or liens provided by applicable law
to which we may otherwise be entitled. We further acknowledge and agree that no
negotiable warehouse receipts or documentation of title has been or will be
issued covering the Collateral nor or hereafter in our possession.
We further acknowledge that we have received and maintain possession of
the Collateral for your benefit and that we shall continue to maintain
possession of the Collateral for your benefit until we received notice (in
writing or in an authenticated email) from you that your security interest
has been terminated. We further acknowledge that we have not acquired any
rights in the Collateral sufficient to transfer an interest or grant a security
interest in or to the Collateral.
We further acknowledge that, according to the terms of your Security
Agreement with the Debtor, you have the right to inspect the Collateral and,
upon default, the right to remove and take possession of the Collateral after
paying in full all reasonable charges incurred by the Debtor and owing to us. We
agree to permit you access to the Collateral for these purposes at your request
without first receiving the consent or permission of the Debtor or any notice
thereto.
Sincerely,
/s/ XXXX XXXXXXX
------------------------------------------
cc: Debtor Xxxx Xxxxxxx
------------------------------------------
VP & GM, ALS
------------------------------------------
Xeta, Inc. consents to the foregoing: /s/ Xxxxx X. Xxxx
--------------------------------------------------------------------------------
(Xeta signature)
Treasury & Services Controller
REVOLVING NOTE
$4,950,000.00 October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of BANK ONE, OKLAHOMA, N.A. (the "Lender"), the
aggregate unpaid principal amount of all Revolving Loans made by the Lender to
the Borrower pursuant to Section 2.1.1 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Oklahoma, N.A., Tulsa, Oklahoma, as Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement. The Borrower shall pay the principal of and accrued and unpaid
interest on the Revolving Loans in full on the Revolving Credit Facility
Termination Date and shall make such mandatory payments as are required to be
made under the terms of Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Revolving Loan and the date and amount of each
principal payment hereunder.
This Note is one of the Revolving Notes issued pursuant to, and is
entitled to the benefits of, the Amended and Restated Credit Agreement dated as
of October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the
lenders party thereto, including the Lender, and Bank One, Oklahoma, N.A., as
Agent. Capitalized terms used herein and not otherwise defined herein are used
with the meanings attributed to them in the Agreement. Reference is made to the
Agreement for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this Note may be prepaid or its
maturity date accelerated.
This Note is secured pursuant to the Collateral Documents, as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender in renewal, extension and increase of and replacement for that
certain Revolving Note dated as of August 21, 2000, executed by the Borrower
payable to the order of the Lender in the stated principal amount of $4,400,000
(the "Prior Note"). All liens and security interests in Property securing
payment of the Prior Note shall continue in full force and effect, uninterrupted
and unabated, as security for payment of this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
----------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
REVOLVING NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001
REVOLVING NOTE
$4,050,000.00
October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"), promises
to pay to the order of FIRSTAR BANK, N.A. (the "Lender"), the aggregate unpaid
principal amount of all Revolving Loans made by the Lender to the Borrower
pursuant to Section 2.1.1 of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The Borrower
shall pay the principal of and accrued and unpaid interest on the Revolving
Loans in full on the Revolving Credit Facility Termination Date and shall make
such mandatory payments as are required to be made under the terms of Article II
of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of each Revolving Loan and the date and amount of each
principal payment hereunder.
This Note is one of the Revolving Notes issued pursuant to, and is entitled
to the benefits of, the Amended and Restated Credit Agreement dated as of
October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the lenders
party thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent.
Capitalized terms used herein and not otherwise defined herein are used with
the meanings attributed to them in the Agreement. Reference is made to the
Agreement for a statement of the terms and conditions governing this Note,
including the terms and conditions under which this Note may be prepaid or its
maturity date accelerated.
This Note is secured pursuant to the Collateral Documents, as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender in renewal, extension and increase of and replacement for that
certain Revolving Note dated as of August 21, 2000, executed by the Borrower
payable to the order of the Lender in the stated principal amount of $3,600,000
(the "Prior Note"). All liens and security interests in Property securing
payment of the Prior Note shall continue in full force and effect, uninterrupted
and unabated, as security for payment of this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
REVOLVING NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001
TERM NOTE
$7,016,258.91
October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of FIRSTAR BANK, N.A. (the "Lender") the aggregate
unpaid principal amount of the Term Loan made by the Lender to the undersigned
pursuant to Section 2.1.2 of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal
amount hereof at the rates and on the dates set forth in the Agreement. The
undersigned shall pay the principal of and accrued and unpaid interest on the
Term Loan in full on October 31, 2003, and prior to maturity shall make such
payments, including mandatory prepayments, as are required to be made under the
terms of Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the Term Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Term Notes issued pursuant to, and is entitled to
the benefits of, the Amended and Restated Credit Agreement dated as of October
31, 2001 (which, as it may be amended or modified and in effect from time to
time, is herein called the "Agreement"), among the Borrower, the lenders party
thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent, to which
Agreement reference is hereby made for a statement of the terms and conditions
governing this Note, including the terms and conditions under which this Note
may be prepaid or its maturity date accelerated. Capitalized terms used herein
and not otherwise defined herein are used with the meanings attributed to them
in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender to evidence a portion of the indebtedness outstanding under that
certain Term Note dated as of November 30, 1999, and that certain Acquisition
Term Note dated as of November 30, 2000, each executed by the Borrower payable
to the order of the Lender (collectively, the "Prior Term Notes"). All liens
and security interests in Property securing payment of the Prior Term Notes
shall continue in full force and effect, uninterrupted and unabated, as
security for this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001 $7,016,258.91 $7,016,258.91
TERM NOTE
$8,575,427.55 October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"), promises
to pay to the order of BANK ONE, OKLAHOMA, N.A. (the "Lender") the aggregate
unpaid principal amount of the Term Loan made by the Lender to the undersigned
pursuant to Section 2.1.2 of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The undersigned
shall pay the principal of and accrued and unpaid interest on the Term Loan in
full on October 31, 2003, and prior to maturity shall make such payments,
including mandatory prepayments, as are required to be made under the terms of
Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the Term Loan and the date and amount of each principal
payment hereunder.
This Note is one of the Term Notes issued pursuant to, and is entitled to
the benefits of, the Amended and Restated Credit Agreement dated as of October
31, 2001 (which, as it may be amended or modified and in effect from time to
time, is herein called the "Agreement"), among the Borrower, the lenders party
thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent, to which
Agreement reference is hereby made for a statement of the terms and conditions
governing this Note, including the terms and conditions under which this Note
may be prepaid or its maturity date accelerated. Capitalized terms used herein
and not otherwise defined herein are used with the meanings attributed to them
in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender to evidence a portion of the indebtedness outstanding under that
certain Term Note dated as of November 30, 1999, and that certain Acquisition
Term Note dated as of November 30, 2000, each executed by the Borrower payable
to the order of the Lender (collectively, the "Prior Term Notes"). All liens and
security interests in Property securing payment of the Prior Term Notes shall
continue in full force and effect, uninterrupted and unabated, as security for
this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
--------------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001 $8,575,427.55 $8,575,427.55
R/E TERM NOTE
$1,402,500.00 October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"),
promises to pay to the order of BANK ONE, OKLAHOMA, N.A. (the "Lender") the
aggregate unpaid principal amount of the R/E Term Loan made by the Lender to
the undersigned pursuant to Section 2.1.3 of the Agreement (as hereinafter
defined), in immediately available funds at the main office of Bank One,
Oklahoma, N.A., Tulsa, Oklahoma, as Agent, together with interest on the unpaid
principal amount hereof at the rates and on the dates set forth in the
Agreement. The undersigned shall pay the principal of and accrued and unpaid
interest on the R/E Term Loan in full on October 31, 2003, and prior to
maturity shall make such payments, including mandatory prepayments, as are
required to be made under the terms of Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the R/E Term Loan and the date and amount of each
principal payment hereunder.
This Note is one of the R/E Term Notes issued pursuant to, and is entitled
to the benefits of, the Amended and Restated Credit Agreement dated as of
October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the
lenders party thereto, including the Lender, and Bank One, Oklahoma, N.A., as
Agent, to which Agreement reference is hereby made for a statement of the terms
and conditions governing this Note, including the terms and conditions under
which this Note may be prepaid or its maturity date accelerated. Capitalized
terms used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender to evidence a portion of the indebtedness outstanding under that
certain Acquisition Term Note dated November 30, 2000, executed by the Borrower
payable to the order of the Lender (the "Prior Note"). All liens and security
interests in Property securing payment of the Prior Note shall continue in full
force and effect, uninterrupted and unabated, as security for this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
--------------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
R/E TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001 $1,402,500.00 $1,402,500.00
R/E TERM NOTE
$1,147,500.00
October 31, 2001
Tulsa, Oklahoma
XETA Technologies, Inc., an Oklahoma corporation (the "Borrower"), promises
to pay to the order of FIRSTAR BANK, N.A. (the "Lender") the aggregate unpaid
principal amount of the R/E Term Loan made by the Lender to the undersigned
pursuant to Section 2.1.3 of the Agreement (as hereinafter defined), in
immediately available funds at the main office of Bank One, Oklahoma, N.A.,
Tulsa, Oklahoma, as Agent, together with interest on the unpaid principal amount
hereof at the rates and on the dates set forth in the Agreement. The undersigned
shall pay the principal of and accrued and unpaid interest on the R/E Term Loan
in full on October 31, 2003, and prior to maturity shall make such payments,
including mandatory prepayments, as are required to be made under the terms of
Article II of the Agreement.
The Lender shall, and is hereby authorized to, record on the schedule
attached hereto, or to otherwise record in accordance with its usual practice,
the date and amount of the R/E Term Loan and the date and amount of each
principal payment hereunder.
This Note is one of the R/E Term Notes issued pursuant to, and is entitled
to the benefits of, the Amended and Restated Credit Agreement dated as of
October 31, 2001 (which, as it may be amended or modified and in effect from
time to time, is herein called the "Agreement"), among the Borrower, the lenders
party thereto, including the Lender, and Bank One, Oklahoma, N.A., as Agent, to
which Agreement reference is hereby made for a statement of the terms and
conditions governing this Note, including the terms and conditions under which
this Note may be prepaid or its maturity date accelerated. Capitalized terms
used herein and not otherwise defined herein are used with the meanings
attributed to them in the Agreement.
This Note is secured pursuant to the Collateral Documents, all as more
specifically described in the Agreement, and reference is made thereto for a
statement of the terms and provisions thereof.
This Note is made, executed and delivered by the Borrower and delivered to
the Lender to evidence a portion of the indebtedness outstanding under that
certain Acquisition Term Note dated November 30, 2000, executed by the Borrower
payable to the order of the Lender (the "Prior Note"). All liens and security
interests in Property securing payment of the Prior Note shall continue in full
force and effect, uninterrupted and unabated, as security for this Note.
XETA TECHNOLOGIES, INC.,
an Oklahoma corporation
[STAMP]
By: /s/ XXXXXX X. XXXXXX
-----------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Secretary and Chief Financial Officer
SCHEDULE OF LOANS AND PAYMENTS OF PRINCIPAL
TO
R/E TERM NOTE OF XETA TECHNOLOGIES, INC.
DATED OCTOBER 31, 2001
Principal Maturity Principal
Amount of of Interest Amount Unpaid
Date Loan Period Paid Balance
---- --------- ----------- --------- -------
October 31, 2001 $1,147,500.00 $1,147,500.00
