Exhibit 99.1
April 1, 1998
PROTECTION ONE ALARM MONITORING, INC.
0000 X. Xxxx Xxxxxxxxx Xxx
Xxxxxx, XX 00000
Attn: Xxxx X. Xxxxx
Gentlemen:
Westar Capital, Inc. ("Lender") is pleased to make available a credit
facility to Protection One Alarm Monitoring, Inc., a Delaware corporation (the
"Borrower") on the following terms and conditions (terms not defined herein have
the meanings assigned to them on Attachment 1 hereto):
I. The Commitment:
A. Subject to the terms and conditions set forth
herein, Lender agrees to make available to Borrower until the
Maturity Date a revolving line of credit providing for
Advances in an aggregate principal amount not exceeding the
Commitment at any time. Until the Maturity Date, Borrower may
borrow, repay and reborrow Advances within the Commitment.
This agreement is executed in replacement and substitution for
that certain Credit Agreement dated as of November 3, 1993, as
amended, among the Borrower, Protection One Alarm Services,
Inc. and Xxxxxx Financial, Inc., as agent and as lender, and
certain other lenders.
B. Base Rate Advances and LIBOR Advances made under
this facility shall mature no later than the Maturity Date. No
WIBOR Advance shall expire later than 90 days after the
Maturity Date, provided however, that if this agreement is not
amended and restated prior to the Maturity Date to extend the
Maturity Date beyond the expiration date of any outstanding
Advances, all outstanding Advances as of the Maturity Date,
together with accrued interest and fees thereon, shall be due
and payable on the Maturity Date.
.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 2
C. Unless Lender shall otherwise agree in writing,
net proceeds from any equity offering by Protection One, Inc.,
a Delaware corporation and Borrower's corporate parent
("Parent"), shall be used to repay outstanding Advances and
the Commitment shall be permanently reduced, unless otherwise
agreed to by Borrower and Lender, by the amount of Lender's
participation in such equity offering.
D. Borrower may permanently terminate or reduce the
Commitment at any time upon two Business Days' prior written
notice or by telephone (promptly confirmed in writing) to
Lender in a minimum amount of $5,000,000; provided that the
Commitment may not be reduced to an amount less than the then
outstanding principal amount of all Advances. All accrued
commitment fees shall be paid on the effective date of any
such reduction or termination.
E. Borrower may voluntarily at any time prepay
Advances upon three Business Days' advance notice to Lender in
an amount not less than $5,000,000. Any prepayments of
Advances shall be accompanied by the payment of accrued
interest on the amount prepaid. In case of prepayment of an
Advance, or upon the failure to borrow an Advance after having
given notice thereof, Borrower shall, upon demand, compensate
Lender for any funding losses arising from any funding
commitment made by Lender with respect to such Advance to
Borrower and arising from Borrower's prepayment or failure to
borrow such Advance.
F. Obligations of the Borrower to repay Advances
shall be evidenced by a Note executed by the Borrower payable
to the order of the Lender representing the Borrower's
obligation to pay the Lender's Commitment or, if less, the
aggregate unpaid principal amount of all Advances made by the
Lender to the Borrower, plus interest on such principal
amounts and all other fees, charges and other amounts due
thereon. The Note shall be dated the date hereof, shall bear
interest on the unpaid principal amount thereof at the
applicable interest rate specified in this agreement and
otherwise shall be in the form attached hereto as Exhibit A.
II. Availability:
A. Advances may be requested as Base Rate Advances,
WIBOR Advances and LIBOR Advances, as selected by Borrower, as
follows:
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 3
1. Base Rate Advances shall be available on any
Business Day upon notice given before 9:00 a.m. (Central
time) on the day of such Advance.
2. WIBOR Advances in amounts of
$25,000,000 or less shall be available on any
Business Day upon notice given before 9:00 a.m.
(Central time) on the day of such Advance.
3. WIBOR Advances in amounts greater
than $25,000,000 shall be available on any Business
Day upon one Business Days' prior notice given before
1:00 p.m. (Central time).
4. Unless Lender shall otherwise
agree, no WIBOR Advance shall be for a Term greater
than 90 days.
5. LIBOR Advances shall be available
on any Business Day upon four Business Days' prior
notice given before 1:00 p.m. (Central time) and
shall have interest periods of one, two, three or six
months.
6. Each notice of borrowing shall be
by telephone and shall specify the requested
borrowing date, the principal amount and length of
interest period (if a LIBOR Rate Advance) or Term (if
a WIBOR Advance) for such Advance. Base Rate Advances
shall be in a minimum principal amount of $5,000,000
and multiples of $1,000,000 in excess of such minimum
amount. LIBOR Advances shall be in a minimum
principal amount of $10,000,000 and multiples of
$1,000,000 in excess of such minimum amount. The
exact duration of interest periods relating to LIBOR
Advances shall be subject to the customs and
practices of the funding markets for such type of
Advance. No interest period for LIBOR Advances shall
expire after the Maturity Date. No WIBOR Advance
shall expire later than 90 days after the Maturity
Date, provided however, that if this agreement is not
amended and restated prior to the Maturity Date to
extend the Maturity Date beyond the expiration date
of any outstanding Advances, all outstanding Advances
as of the Maturity Date, together with accrued
interest and fees thereon, shall be due and payable
on the Maturity Date.
B. Upon four Business Days' prior notice given before
1:00 p.m. (Central time), a LIBOR Advance may be continued on
the last day of its interest period as a LIBOR Advance, or a
Base Rate Advance or WIBOR Advance may be converted into a
LIBOR Advance. Upon notice given on any Business Day prior to
9:00 a.m. (Central time) in the event such Advance is
$25,000,000 or less, or, upon one
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 4
Business Days' prior notice given before 1:00 p.m. (Central
time) in the event such Advance is greater than $25,000,000, a
LIBOR Advance may be converted into a WIBOR Advance on the
last day of its interest period. Upon notice given on any
Business Day prior to 9:00 a.m. (Central time) a LIBOR Advance
may be converted into a Base Rate Advance on the last day of
its interest period. If Borrower fails to give a notice
described above prior to the end of any expiration, Borrower
shall be deemed to have requested that the maturing Advance be
converted into a Base Rate Advance.
C. If at any time Lender, in its sole discretion,
determines that the LIBOR Rate or WIBOR Rate does not
accurately reflect the funding cost to Lender of lending such
Advances, Lender's obligation to make LIBOR Advances or WIBOR
Advances, as the case may be, shall cease during such period.
If at any time Lender, in its sole discretion, determines that
adequate resources are not available to support the lending of
WIBOR Advances, Lender's obligation to make WIBOR Advances
shall cease during such period.
III. Pricing:
A. Each Base Rate Advance shall bear interest at a
floating rate equal to the Base Rate plus 112.5 basis points
per annum, payable in arrears on the last Business Day of each
quarter and on the Maturity Date.
B. Each WIBOR Advance shall bear interest at a fixed
rate equal to the WIBOR Rae plus 112.5 basis points per annum,
payable monthly in arrears on the first Business Day of each
month and on the Maturity Date.
C. Each LIBOR Advance shall bear interest at a fixed
rate per annum equal to the LIBOR Rate plus 112.5 basis points
per annum, payable on the last day of each interest period
and, with respect to advances with interest periods longer
than three months, at the end of the third month of such
advance.
D. Borrower shall pay a commitment fee equal to 30
basis points per annum on the daily average unutilized portion
of the Commitment for the period commencing on the Closing
Date and ending on the Maturity Date, payable quarterly in
arrears and on the Maturity Date. All Commitment Fees shall be
computed on the basis of the actual number of days elapsed in
a year of 360 days.
E. All amounts not paid when due hereunder shall bear
interest, to the extent permitted by law, at a per annum rate
which is equal to the Base Rate plus 2 percent. Upon any Event
of Default under Paragraph IX A, B or C, all Advances shall,
at Lender's option, be
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 5
converted into Base Rate Advances. Upon any Event of Default,
Borrower may not request Advances to be made or continued as,
or converted into, LIBOR Advances or WIBOR Advances without
Lender's consent.
F. All interest on LIBOR Advances and WIBOR Advances
shall be calculated on the basis of a year of 360 days and
actual days elapsed which results in greater interest than if
a 365/366 day-year were used. Interest on Base Rate Advances
shall be calculated on the basis of a year of 365/366 days and
actual days elapsed.
IV. Payments:
A. All payments to Lender shall be made at 000 Xxxxx
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxx 00000, or such other location or
bank account(s) as Lender may from time to time specify in
same day funds not later than 12:00 noon (Central time).
B. Borrower shall make all payments under this
agreement free and clear of any deduction for any future taxes
(other than any withholding taxes), and reimburse Lender for
any future taxes assessed on or withheld from such payments
(except franchise taxes and taxes assessed on the net income,
gross receipts or capital of Lender).
C. All amounts due hereunder shall be evidenced by
entries in records maintained by Lender, which shall be deemed
accurate in all respects, absent manifest error; provided
however, the failure of Lender to maintain any such records,
or any error therein, shall not in any manner affect the
obligation of Borrower to repay any Advances and other
obligations in accordance with the terms hereof.
D. Borrower shall reimburse or compensate Lender,
upon demand, for all material costs incurred, losses suffered
or payments made by Lender which are applied or reasonably
allocated by Lender to the transactions contemplated herein
(all as determined by Lender in its reasonable discretion) by
reason of:
1. Any and all future reserve,
deposit, capital adequacy or similar requirements
against (or against any class of or change in or in
the amount of) assets or liabilities of, or
extensions of credit by, Lender; and
2. Compliance by Lender with any
direction or requirements from any regulatory
authority, whether or not having the force of law.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 6
V. Conditions for use of Facility:
A. Initial Extension of Credit. As a condition precedent to
the first use of this facility, Lender must have received the
following, in form and substance satisfactory to Lender:
1. This agreement and Note, duly executed and
delivered by Borrower.
2. Parental Guaranty, duly executed
and delivered by Parent attached hereto as Exhibit B.
3. Affiliate Guaranties, duly
executed and delivered by Westar Security, Inc. and
WestSec, Inc. attached hereto as Exhibit C and
Exhibit D, respectively.
4. Pledge Agreement, duly executed
and delivered by Parent and Borrower, together with
certificates representing all of Borrower's,
WestSec's, and Westar Security's capital stock with
executed stock powers ("Pledged Shares") attached
hereto as Exhibit E.
5. Articles of incorporation of
Borrower certified by the secretary of state of
Borrower's incorporation.
6. Borrower's by-laws, certified by
the secretary or an assistant secretary of Borrower.
7. Corporate resolutions with
certificate of incumbency evidencing the authority of
the officer(s) executing this agreement on behalf of
Borrower.
8. Corporate resolutions with
certificate of incumbency evidencing the authority of
the officer(s) executing the Guaranties and Pledge
Agreement.
9. Legal opinion of Borrower's
counsel as to such matters reasonably requested by
Lender.
10. A certificate of a financial
officer of Borrower stating that the representations
and warranties set forth in Paragraph VI below are
correct in all material respects on and as of such
date as though made on such date, except to the
extent such representations and warranties expressly
relate to an earlier date.
11. Payment of Lender's legal costs and expenses.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 7
12. All amounts due under the
Promissory Notes, dated January 1, 1998 and March 2,
1998, between Borrower and Lender shall be paid in
full with the proceeds of the first Advance hereunder
and the Promissory Notes cancelled.
13. Such other documents as the
Lender may reasonably request in order to effect
fully the purposes of this agreement.
B. Each Extension of Credit. As a condition precedent
to all Advances, the following conditions must be satisfied:
1. Each representation and warranty
set forth in paragraph VI below shall be true and
correct as if made on the date of such use (and each
request for an Advance shall be deemed a further
representation that such are true and correct).
2. No Event of Default or event or
condition which, with the passage of time or the
giving of notice, or both, shall become an Event of
Default, shall have occurred under this agreement.
VI. Representations and Warranties: Borrower represents and warrants to
Lender that:
A. Borrower, Parent and each of their respective
Subsidiaries: (a) is a corporation duly organized, validly
existing and in good standing under the laws of the
jurisdiction of its incorporation; (b) has the power and
authority and all governmental licenses, authorizations,
consents and approvals to own its assets, carry on its
business as currently conducted, and to execute, deliver, and
perform its obligations under this agreement if it is a party
hereto; and (c) is duly qualified as a foreign corporation and
is licensed and in good standing under the laws of each
jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such
qualification or license; except, in each case referred to in
clauses (b) and (c) above, to the extent that the failure to
do so would not reasonably be expected to cause a Material
Adverse Change.
B. The execution, delivery and performance by
Borrower of this agreement does not and will not (a) violate
any provision of law, the certificate of incorporation or
bylaws of Borrower or any order, judgment or decree of any
court or other agency of government binding on Borrower where
such violation would reasonably be expected to cause a
Material Adverse Change, or (b) conflict with, result in a
breach of or constitute (with due
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 8
notice or lapse of time or both) a default under any material
agreement or instrument to which Borrower is a party or by
which any of its properties or assets is bound, where such
conflict, breach or default would reasonably be expected to
cause a Material Adverse Change.
C. No approval, consent, exemption, authorization, or
other action by, or notice to, or filing with, any
governmental authority is necessary or required in connection
with the execution, delivery or performance by, or enforcement
against, Borrower of this agreement.
D. This agreement constitutes the legal, valid and
binding obligations of Borrower, enforceable against Borrower
in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, or similar laws
affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability.
E. Borrower is not in violation of any material term
of any lease, contract, agreement or instrument to which it is
a party where such violation would reasonably be expected to
cause a Material Adverse Change.
F. No Event of Default or event or condition which,
with the passage of time or the giving of notice, or both,
shall become an Event of Default, has occurred and is
continuing.
G. Borrower's audited financial statements dated
December 31, 1997, and the related statements of income or
operations, shareholders' equity and cash flows for the fiscal
year ended on that date were prepared in accordance with GAAP
consistently applied throughout the periods covered thereby,
except as otherwise expressly noted therein and fairly present
the financial condition of Borrower and its subsidiaries as of
the dates thereof and results of operations for the periods
covered thereby. Since December 31, 1997, there has been no
Material Adverse Change.
H. There is no litigation, proceeding or dispute
pending or, to the best of Borrower's knowledge, threatened
against Borrower or any of its Subsidiaries which would
reasonably be expected to result in a Material Adverse Change
or purport to affect Borrower's obligations under this
agreement, or any of the transactions contemplated hereby.
I. Each Plan is in compliance in all material
respects with the applicable provisions of ERISA, the Code and
other federal or state law. There are no pending, or to the
best knowledge of
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 9
Borrower, threatened claims, actions or lawsuits, or action by
any governmental authority, with respect to any Plan which has
caused or would reasonably be expected to cause a Material
Adverse Change. The aggregate unfunded pension liability for
each such Plan does not exceed $100,000.
J. Borrower has good and sufficient title to, or
valid leasehold interest in, all of its properties and assets
except where the failure would not reasonably be expected to
cause a Material Adverse Change.
K. Borrower and its Subsidiaries have filed all
Federal and other material tax returns and reports required to
be filed, and have paid all Federal and other material taxes,
assessments, fees and other governmental charges levied or
imposed upon them or their properties, income or assets
otherwise due and payable, except those which are being
contested in good faith by appropriate proceedings and for
which adequate reserves have been provided in accordance with
GAAP.
L. Borrower conducts in the ordinary course of
business a review of the effect of existing environmental
laws, regulations, and guidelines and claims on its
properties, and as a result thereof Borrower has reasonably
concluded that such environmental laws and claims would not,
individually or in the aggregate, reasonably be expected to
cause a Material Adverse Change.
M. Borrower is not subject to the Public Utility
Holding Company Act of 1935, as amended.
N. Borrower is not an "investment company" or a
company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended.
O. None of the statements contained in any exhibit,
report, statement or certificate furnished by Borrower to
Lender in connection with this Agreement contains any untrue
statement of a material fact or omits any material fact
required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under
which they are made, not misleading as of the time when made
or delivered in each case where such material misstatement or
omission would reasonably be likely to adversely affect the
rights or interests of Lender.
VII. Affirmative Covenants: Until the Commitment has terminated
and all indebtedness of Borrower hereunder to Lender has been paid in
full, Borrower, unless Lender shall consent in writing:
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 10
A. Shall provide to Lender:
1. annual financial statements
prepared in accordance with GAAP, together with an
opinion of its independent accountants within 120
days of each fiscal year-end of Borrower unqualified
as to scope of audit or going concern;
2. quarterly company-prepared
financial statements prepared in accordance with GAAP
within 90 days of the end of each of Borrower's first
three fiscal quarters;
3. together with delivery of the
financial statements referred to above, a certificate
from the Chief Financial Officer of Borrower
certifying no Event of Default has occurred and
demonstrating compliance with the covenants contained
in paragraph F of Section VIII;
4. promptly upon their becoming
available, copies of all financial statements,
reports, notices and proxy statements sent or made
available generally by Borrower to its security
holders, including all regular and periodic reports
and all prospectuses that have been filed by Borrower
with any securities exchange or with the Securities
and Exchange Commission, except prospectuses relating
to benefit plans filed under Form S-8;
5. written notice of the occurrence
of any Event of Default or any event which, with the
lapse of time or notice or both, would become an
Event of Default; and
6. such other information regarding
the operations, business affairs and financial
condition of Borrower or any Subsidiary or compliance
with the terms of the Agreement as Lender may from
time to time reasonably request.
B. Will, and will cause Parent and each of their
respective Subsidiaries to, at all times preserve and keep in
full force and effect their corporate existence and all rights
and franchises material to their business.
C. Will maintain or cause to be maintained in good
repair, working order and condition all material
properties used in the business of Borrower, Parent and'
their respective Subsidiaries and will make or cause to be
made all appropriate repairs, renewals and replacements
thereof. Borrower will maintain or cause to be maintained,
with financially
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 11
sound and reputable insurers, public liability and property
damage insurance with respect to its business and properties
and the business and properties of Parent and their respective
Subsidiaries against loss or damage of the kinds customarily
carried or maintained by corporations of established
reputation engaged in similar businesses and in amounts
acceptable to Lender and will deliver evidence thereof to
Lender.
D.
Will and will cause Parent and each of their respective
Subsidiaries to (a) comply with the requirements of all
applicable laws, rules, regulations and orders of any
governmental authority as now in effect and which may be
imposed in the future in all jurisdictions in which Borrower,
Parent or any such Subsidiary is now doing business or may
hereafter be doing business, other than those laws, rules,
regulations and orders the noncompliance with which would not
reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Change, and (b) maintain, as the
case may be, all licenses and permits now held or hereafter
acquired, the loss, suspension, or revocation of which, or
failure to renew, could have a Material Adverse Change.
E.
1.
Shall and shall cause Parent and each of their respective
Subsidiaries to, from time to time, execute such
guaranties, financing statements, documents, security
agreements and reports as Lender at any time may
reasonably request to evidence, perfect or otherwise
implement the guaranties and security for repayment
of the obligations hereunder provided for in the Loan
Documents. Without limiting the generality of the
foregoing, Lender may at any time request that
Borrower cause Parent and each of their respective
Subsidiaries to secure Borrower's obligations
hereunder and the obligations under the Guaranties in
a manner satisfactory to Lender, and Borrower shall
cause Parent and each of their respective
Subsidiaries to comply therewith.
2.
At Lender's request, shall cause Parent and each of
their respective Subsidiaries promptly to guaranty
the Borrower's and Parent's obligations under the
Loan Documents and to grant to Lender, a security
interest in the real, personal and mixed property of
any such Person to secure such obligations. The
documentation for such guaranty or security shall be
in such form and substance as Lender shall reasonably
request.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 12
VIII. Negative Covenants: Borrower covenants and agrees that so long as
any of the Commitment remains in effect and until payment in full of
all obligations under the Loan Documents, unless Lender shall otherwise
give its prior written consent, Borrower shall comply with and shall
cause Parent and each of their respective Subsidiaries to comply with
all covenants in this Section VIII applicable to such Person.
A.
Borrower will not, nor will Borrower permit Parent or any of
their respective Subsidiaries directly or indirectly to,
create, incur, assume, guaranty, or otherwise become or remain
directly or indirectly liable with respect to any Indebtedness
except the obligations under the Loan Documents, any
Indebtedness outstanding on the date hereof, intercompany
Indebtedness among Borrower and its affiliates which is
unsecured and subordinate to the obligations to Lender, and
Indebtedness not exceeding $25,000,000.
B.
Borrower will not, nor will Borrower permit Parent or any of
their respective Subsidiaries directly or indirectly to
create, incur, assume or permit to exist any Lien on or with
respect to any property or asset (including any document or
instrument with respect to goods or accounts receivable) of
Borrower, Parent or any of their respective Subsidiaries,
whether now owned or hereafter acquired, or any income or
profits therefrom, except Permitted Encumbrances.
C.
Borrower will not, nor will Borrower permit Parent or any of
their respective Subsidiaries to, enter into or assume any
agreement (other than the Loan Documents, the Subordinated
Discount Note Indenture and the documents governing the
Convertible Notes) prohibiting the creation or assumption of
any Lien upon its properties or assets,
whether now owned or hereafter acquired.
D.
Except as provided herein and under the Subordinated Discount
Note Indenture and the documents governing the Convertible
Notes, Borrower will not, nor will Borrower permit Parent or
any of their respective Subsidiaries, directly or indirectly,
to create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any
kind on the ability of Borrower, Parent or any of their
respective Subsidiaries to: (1) pay dividends or make any
other distribution on such Person's capital stock; (2) subject
to subordination provisions, pay any indebtedness owed to
Parent, Borrower or any of their respective Subsidiaries; (3)
make loans or advances to Parent, Borrower or any Subsidiary
of Borrower; or (4) transfer any of its property or assets to
Parent, Borrower or any of Borrower's Subsidiaries.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 13
E.
1.
Borrower will not, nor will Borrower permit Parent or any of
their respective Subsidiaries to sell, lease,
transfer or otherwise dispose of any of its property,
business or assets, or grant any Person an option to
acquire any such property, business or assets except
for (a) bona fide sales of inventory to customers for
fair value in the ordinary course of business and
dispositions of obsolete equipment not used or useful
in the business, (b) mergers and transfers of assets
among Borrower and its Subsidiaries provided no such
transfer or merger may result in a Default or Event
of Default; (c) sales of subscriber accounts which do
not result in a Material Adverse Change; and (d)
other Asset Dispositions if all of the following
conditions are met: (i) the market value of assets
sold or otherwise disposed of in any single
transaction or series of related transactions does
not exceed $5,000,000 and the aggregate market value
of assets sold or otherwise disposed of in any Fiscal
Year does not exceed $10,000,000; (ii) the
consideration received is at least equal to the fair
market value of such assets; (iii) the Net Proceeds
of such Asset Disposition are applied to reduce
outstanding Advances; (v) after giving effect to the
sale or other disposition of the assets included
within the Asset Disposition and the repayment of
Indebtedness with the proceeds thereof, Borrower is
in compliance on a pro forma basis with the covenants
set forth in Section VIII recomputed for the most
recently ended month for which information is
available and is in compliance with all other terms
and conditions contained in this agreement; and (vi)
no Default or Event of Default shall result from such
sale or other disposition.
2.
Except as permitted elsewhere in this agreement, Borrower
will not, nor will Borrower permit Parent or any of
their respective Subsidiaries directly or indirectly
to sell, assign, pledge or otherwise encumber or
dispose of any shares of capital stock or other
equity securities in Borrower, WestSec, or any of
their or Parent's Subsidiaries including warrants,
rights or options to acquire shares or other equity
securities of any such Person.
3.
Borrower and WestSec shall at all times be direct
wholly-owned Subsidiaries of Parent.
F.Borrower will not permit its Leverage Ratio to exceed 6.0 to
1.
G. Borrower will not use any portion of the loan proceeds, to
purchase or carry margin stock, as defined in Regulation G, T,
U or X of the Federal Reserve Board.
IX. Events of Default: If any of the following events ("Events of Default")
shall occur:
A. Borrower fails to pay any principal of any Advance when due;
or
B. Borrower fails to pay any interest on any Advance within
three days after becoming due; or
C. Borrower fails to pay any other amount (other than
an amount referred to in A or B above) when due and such
default shall continue unremedied for a period of ten days
following notice from Lender; or
D. Any representation or warranty made by Borrower or
Parent to Lender in any documents or agreements relating to
this facility proves to be in any material respect false or
misleading; or
E. Borrower fails to comply with (i) Paragraph
VII.A.5, VII.E or VIII, or (ii) any other condition, covenant
or obligation contained herein or in any agreements or
instruments related hereto and such default shall continue
unremedied for a period of 30 days after notice thereof from
Lender to Borrower; or
F. Any default occurs under any other agreement
involving the extension of credit in excess of $500,000 in
recourse debt to which Borrower, Parent or their respective
Subsidiaries may be obligated as borrower (if such default
gives the holder of the obligation the right to accelerate the
indebtedness); or
G. If (i) any Plan subject to Title IV of ERISA and
maintained for the employees of Borrower, Parent, or their
respective Subsidiaries shall be terminated pursuant to
Subtitle C of Title IV of ERISA, (ii) a trustee shall be
appointed by the appropriate United States District Court to
administer any such Plan, (iii) the PBGC shall institute
proceedings to terminate any such Plan, or (iv) any such Plan
fails to satisfy the minimum funding standard for such Plan
for a Plan year as established in Section
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 14
412 of the Internal Revenue Code, as amended and such event
under any of G(i)-(iv) would reasonably be expected to result
in a Material Adverse Change; or
H. Any agreement or instrument required hereunder,
which materially affects Lender's rights or Borrower's,
Parent's or their respective Subsidiaries' obligations, is
terminated, breached or ceases to be effective; or
I. The loss, suspension or revocation of, or failure
to renew, any license or permit now held or hereafter acquired
by Borrower, Parent or any of their respective Subsidiaries,
if such loss, suspension, revocation or failure to renew could
have a Material Adverse Change; or
J.
Lender does not have or ceases to have a valid and perfected
first priority security interest in the Pledged Shares, in
each case, for any reason other than the failure of Lender to
take any action within its control; or
K. Lender fails to own, directly or indirectly, 51% or more of
the outstanding capital stock of Borrower and Parent; or
L. Pledge Agreement and/or Guaranties are terminated, breached
or ceases to be effective; or
M. Any bankruptcy, reorganization, arrangement,
insolvency, dissolution or similar proceeding is instituted by
or against Borrower, Parent or any of their respective
Subsidiaries under the laws of any jurisdiction and, with
respect to any involuntary bankruptcy or insolvency
proceeding, such proceeding remains undismissed for a period
of 60 days;
THEN, Lender may, by written notice to
Borrower, (i) declare Lender's Commitment to extend additional
credit hereunder to be terminated, whereupon the Commitment
shall be terminated, (ii) declare all sums outstanding
hereunder or under any instrument executed in connection
herewith to be immediately due and payable together with all
interest thereon, all without notice of default, presentment
or demand for payment, protest or notice of nonpayment or
dishonor, or other notices or demands of any kind or
character, all of which are hereby expressly waived; provided,
however, that upon the occurrence of any event specified in
paragraph VIII.M above, any Commitment by Lender to extend
additional credit hereunder shall automatically terminate, all
sums outstanding hereunder or under any instrument executed in
connection herewith shall become immediately due and payable
together with all
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 15
interest thereon, all without notice of default, presentment
or demand for payment, protest or notice of nonpayment or
dishonor, or other notices or demands of any kind or
character, all of which are hereby expressly waived.
X. Indemnity: In addition to the payment of expenses and fees
hereunder, Borrower agrees to indemnify, pay and hold Lender and any
holder of any of the Notes, and the officers, directors, employees,
agents, affiliates and attorneys of Lender and such holders
(collectively called the "Indemnitees") harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, claims, liabilities for taxes, broker's or finders
fees, costs, expenses and disbursements of any kind or nature
whatsoever (including the fees and disbursements of counsel for such
Indemnitees in connection with any investigative, administrative or
judicial proceeding commenced or threatened, whether or not such
Indemnitee shall be designated a party thereto) that may be imposed on,
incurred by, or asserted against that Indemnitee, in any manner
relating to or arising out of (a) the negotiation, execution, delivery,
performance, administration, or enforcement of any of the Loan
Documents, (b) any of the transactions contemplated by the Loan
Documents, (c) any breach by Borrower or Parent of any representation,
warranty, covenant, or other agreement contained in any of the Loan
Documents, (d) Lender's agreement to make the Advances hereunder, (g)
the use or intended use of the proceeds of any of the Advances, (h) any
and all taxes, levies, deductions and charges imposed on Lender or any
of Lender's correspondents in respect of any Advance (the foregoing
liabilities herein collectively referred to as the "Indemnified
Liabilities"); provided that Borrower shall have no obligation to an
Indemnitee hereunder with respect to Indemnified Liabilities arising
from the gross negligence or willful misconduct of that Indemnitee as
determined by a court of competent jurisdiction. To the extent that the
undertaking to indemnify, pay and hold harmless set forth in the
preceding sentence may be unenforceable because it is violative of any
law or public policy, Borrower shall contribute the maximum portion
that it is permitted to pay and satisfy under applicable law to the
payment and satisfaction of all Indemnified Liabilities incurred by the
Indemnitees or any of them.
XI. Miscellaneous.
A. Borrower shall pay Lender, on demand, all
reasonable out-of-pocket expenses and legal fees (including
the allocated costs for in-house legal services) incurred by
Lender in connection with the enforcement of this agreement
and any instruments or agreements executed in connection with
this agreement.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 16
B. This letter agreement shall be governed by and
construed in accordance with the laws of the state of Kansas,
to the jurisdiction of whose courts, both state and federal
all signatories hereto submit.
C. This letter supersedes all prior agreements and
oral negotiations with respect to the subject matter of this
letter. This agreement is not assignable by Borrower and any
purported assignment is void. Lender may, at any time, grant
participations in all or part of its rights and obligations
hereunder and/or assign all or any part of its rights and
obligations hereunder.
D. No delay or omission by Lender to exercise any
right under this letter or under any document related hereto
shall impair such right, nor shall it be construed as a waiver
thereof. No waiver of any breach or default shall be deemed a
waiver of any subsequent breach or default. Any amendment,
waiver, consent or approval under this letter must be in
writing to be effective.
E. Paragraph headings in this letter are for
reference only and shall not affect the interpretation of any
provision of this letter.
F. Except as otherwise expressly provided herein,
notices and other communications provided for herein shall be
in writing and shall be delivered by hand or overnight courier
service, mailed or sent by telex, telecopy or other
telegraphic communications equipment of the sending party, as
follows: (a) if to Borrower, to it at 0000 X. Xxxx Xxxxxxxxx
Xxx, Xxxxxx, XX 00000, Attention of Xxxxx Xxxxxx, Facsimile
No. (000) 000-0000; and (b) if to Lender, to it at 000 Xxxxx
Xxxxxx Xxxxxx, Xxxxxx, Xxxxxx 00000, Attention of E. Xxxx
Xxxx, Facsimile No. (000) 000-0000.
G. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY
APPLICABLE LAW, LENDER AND BORROWER HEREBY IRREVOCABLY WAIVE
THEIR RESPECTIVE RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY
ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE
IN CONNECTION WITH THIS AGREEMENT, THE NOTE OR ANY OTHER LOAN
DOCUMENT, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER,
OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.
H. Notwithstanding any other provision of this
agreement, in no event shall the interest payable on Advances,
whether before or after maturity, exceed the maximum interest
which, under applicable law, may be charged.
PROTECTION ONE ALARM MONITORING, INC.
April 1, 1998
Page 17
Please indicate your acceptance of the foregoing terms and
conditions by signing and returning a copy of this letter.
Sincerely yours,
WESTAR CAPITAL, INC.
By: \s\ Xxxx X. Xxxxxx
Name: Xxxx X. Sharpe_________
Title: President_____
Agreed and Accepted:
PROTECTION ONE ALARM MONITORING, INC.
By: \s\ Xxxx X. Xxxxx
Name: _John X. Xxxxx
Title: Executive Vice President &
Chief Financial Officer
ATTACHMENT 1
DEFINITIONS
Advance: a Base Rate Advance, a WIBOR Advance or a LIBOR
Advance (collectively, the "Advances").
Asset
Disposition: the disposition whether by sale, lease, transfer, loss,
damage, destruction, condemnation or otherwise of any of the
following: (a) any of the stock of any of Borrower's or
Parent's Subsidiaries; or (b) any or all of the assets of
Borrower, Parent or any of their respective Subsidiaries
other than sales of inventory in the ordinary course of
business.
Base Rate: the higher of: (a) the rate of interest
publicly announced from time to time by Chase
Manhattan Bank in New York, as its "Prime Rate,", (b)
one percent per annum above the secondary market rate
for three-month certificates of deposit (adjusted for
statutory reserve requirements), and (c) one-half
percent per annum above the Federal Funds Rate. Any
change in the Prime Rate announced by Chase Manhattan
Bank shall take effect at the opening of business on
the day specified in the public announcement of such
change.
Base Rate
Advance: an Advance bearing an interest rate based on the Base
Rate.
Business Day: (a) any day other than a Saturday,
Sunday or other day on which commercial banks in New
York City and the state of Kansas are authorized or
required by law to close and (b) in the case of LIBOR
Advances and WIBOR Advances, such a day on which
dealings are also carried on in the applicable
market.
Capital
- 18 -
Expenditures: without duplication, for any period,
the aggregate of all expenditures on a consolidated
basis including deposits (whether paid in cash or
property or accrued as liabilities and including the
aggregate amount of all principal payments due for
the entire term of all Capital Leases which are
required to be capitalized on the balance sheet) made
by Borrower, Parent and their respective Subsidiaries
that, in conformity with GAAP, are required to be
included in the property, plant, or equipment, or
similar fixed asset account; provided, however, there
shall be excluded from the calculation of Capital
Expenditures only that portion of all such
expenditures which Borrower, Parent and their
respective Subsidiaries are permitted to reinvest or
use for replacement or restoration of assets through
the use of insurance proceeds, awards of compensation
arising from condemnation or eminent domain
proceedings or from Net Proceeds of Asset
Dispositions.
Capital Lease: any lease of any property (whether real, personal or mixed)
that, in conformity with GAAP, should be accounted for as a
capital lease.
Closing Date: the date this letter is executed by Borrower.
Code: the Internal Revenue Code of 1986, as the same
may be amended from time to time.
Commitment: $600,000,000.
Consolidated
EBITDA: for any period, the following, each
calculated for such period: (a) Net Income; plus (b)
any provision for (or less any benefit from) income
or franchise taxes included in the determination of
Net Income; plus (c) interest expense deducted in the
determination of Net Income; plus (d) amortization
and depreciation deducted in the determination of Net
Income; plus (e) losses from (or less gains from)
Asset Dispositions or other non-recurring items
included in the determination of Net Income,
including gains arising from any reduction in the
reserve for Transition Costs maintained by Borrower,
Parent and their respective Subsidiaries; less (f)
after tax extraordinary gains (or
- 19 -
plus after tax extraordinary losses) (in each case as
defined under GAAP).
Convertible
Notes: 6 3/4% Convertible Senior Subordinated Notes due 2003
of Borrower.
Currency
Agreement: means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement designed
to protect Borrower, Parent or any of their respective
Subsidiaries against fluctuations in currency values to or
under which they are a party or a beneficiary on the closing
date or becomes a party or a beneficiary thereafter.
Deferred
Account
Acquisition
Price: means, in connection with (i) the purchase of
Subscriber Accounts, or (ii) the acquisition of all
of the outstanding Capital Stock of a Person where
the principal purpose of such acquisition is to
acquire Subscriber Accounts, that portion of the
purchase price of such Subscriber Accounts or Capital
Stock that has been deferred to provide an offset for
future purchase price adjustments.
ERISA: the Employee Retirement Income Security Act of 1974,
as amended.
Federal
Reserve Board: the Board of Governors of the Federal Reserve System, or any
successor thereto.
Indebtedness: with respect to any Person at any date
of determination (without duplication), (i) all
indebtedness of such Person for borrowed money, (ii)
all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments
(except, with respect to Borrower, the promissory
notes issued by Borrower in favor of Ion Leasing,
Inc. (which obligations have been defeased by a cash
deposit in a segregated trust account)), (iii) all
obligations of such Person with respect of letters of
credit or other similar instruments (including
reimbursement obligations
- 20 -
with respect thereto), (iv) all obligations of such
Person to pay the deferred and unpaid purchase price
of property or services, which purchase price is due
more than six months after the date of placing such
property in service or taking delivery and title
thereto or the completion of such service, except (A)
Trade Payables, (B) all obligations to pay any
Deferred Account Acquisition Price, provided that the
maximum amount excluded from the definition of
"Indebtedness" under this clause (B) shall not exceed
$5,000,000 in the aggregate at any date of
determination and (C) compensation payable to
employees of such Person (or any subsidiary thereof)
under employee benefit plans of such Person, which
compensation is deferred in the ordinary course of
business of such Person (or such subsidiary) and in
accordance with such plans, (v) all Capital Lease
Obligations of such Person, (vi) all Indebtedness of
other Persons secured by a Lien on any asset of such
Person, whether or not such Indebtedness is assumed
by such Person; provided that the amount of such
Indebtedness shall be the lesser of (A) the fair
market value of such asset at such date of
determination and (B) the amount of such
Indebtedness, (vii) all Indebtedness of other Persons
guaranteed by such Person to the extent such
Indebtedness is guaranteed by such Person, (viii) all
outstanding Redeemable Stock issued by such Person
and (ix) to the extent not otherwise included in this
definition, obligations under Currency Agreements and
Interest Rate Agreements. The amount of Indebtedness
of any Person at any date shall be the outstanding
balance at such date of all unconditional obligations
as described above and, with respect to contingent
obligations (other than those described in clause
(vii)), the maximum liability upon the occurrence of
the contingency giving rise to the obligations
(including with respect to any premium which may be
payable on the redemption of Redeemable Stock),
provided (i) that the amount outstanding at any time
of any Indebtedness issued with original issue
discount is the face amount of such Indebtedness less
the remaining unamortized portion of the original
issue discount of such Indebtedness at such time as
determined in conformity with GAAP and (ii) that
Indebtedness shall not include any liability for
federal, state, local or other taxes that are not
delinquent.
- 21 -
Notwithstanding anything to the contrary contained
herein, for purposes of calculating the Leverage
Ratio, in the case of each of clauses (i), (ii) and
(iii) above, the amount of such Indebtedness shall be
the amount that would appear as a liability on the
balance sheet of such Person prepared in accordance
with GAAP.
Interest Rate
Agreement: any interest rate swap agreement, interest
rate cap agreement, interest rate collar agreement or
other similar agreement or arrangement designed to
protect Borrower, Parent or any of their respective
Subsidiaries against fluctuations in interest rates.
Ion
Acquisition: the acquisition by Borrower of certain of the assets of Ion
Leasing, Inc. pursuant to the Ion Acquisition Documents.
Ion
Acquisition
Documents:
collectively, the Asset Purchase Agreement dated as of
September 24, 1993 among Borrower and Ion Leasing,
Inc. and its shareholders, and all other documents,
agreements or certificates executed in connection
therewith.
Leverage
Ratio: the ratio of (i) the aggregate amount of
Indebtedness of the Borrower, Parent and their
respective Subsidiaries to (ii) four times
Consolidated EBITDA for the most recent fiscal
quarter for which financial information in respect
thereof is available. In making the foregoing
calculation, (A) pro forma effect shall be given to
(1) any Indebtedness incurred subsequent to the end
of the applicable period to the extent such
Indebtedness is outstanding at the date of
calculation, and (2) any Indebtedness incurred during
such period to the extend such Indebtedness is
outstanding at the date of calculation and (3) any
Indebtedness to be incurred, in each case as if such
Indebtedness had been incurred on the first day of
such period and after giving pro forma effect to the
application of the proceeds thereof as if such
application had occurred on such first day; (B)
interest expense attributable to interest on any
Indebtedness
- 22 -
(whether existing or being incurred) computed on a
pro forma basis and bearing a floating interest rate
shall be computed as if the rate in effect on the
date of calculation (taking into account any Interest
Rate Agreement applicable to such Indebtedness if
such Interest Rate Agreement has a remaining term in
excess of 12 months) had been the applicable rate for
the entire period; (C) there shall be excluded from
Interest Expense any Interest Expense related to any
amount of Indebtedness that was outstanding during
such period or thereafter but that is not outstanding
or is to be repaid on the date of calculation; (D)
pro forma effect shall be given to Asset Dispositions
and any asset acquisitions (including giving pro
forma effect to the application of proceeds of any
Asset Disposition) that occur during such period or
thereafter and on or prior to the date of calculation
as if they had occurred and such proceeds had been
applied on the first day of such period; (E) with
respect to any such period commencing prior to the
Closing Date, any Advances shall be deemed to have
taken place on the first day of such period; and (F)
pro forma effect shall be given to Asset Disposition
and asset acquisitions (including giving pro forma
effect to the application of proceeds of any Asset
Disposition) that have been made by any Person that
has become a Subsidiary of Parent or Borrower or has
been merged with or into Borrower, Parent or any of
their Subsidiaries during such period or subsequent
to such period and prior to date of calculation and
that would have constituted Asset Dispositions or
asset acquisitions had such transactions occurred
when such Person was a Subsidiary of Parent or
Borrower as if such Asset Depositions or asset
acquisitions were Asset Dispositions or asset
acquisitions that occurred on the first day of such
Period.
LIBOR Rate: the rate (rounded upwards, if necessary,
to the nearest 1/16th of 1 percent) at which dollar
deposits in same day funds would be offered at 11:00
a.m., London time two Business Days prior to the
commencement of the relevant interest period by major
banks in the London eurodollar market for a period
comparable to the relevant interest period, as
obtained from Chase Manhattan Bank.
- 23 -
LIBOR Rate
Advance: an Advance bearing an interest rate based on the LIBOR
Rate.
Lien: any lien, mortgage, pledge, security interest,
charge or encumbrance of any kind, whether voluntary or
involuntary, (including any conditional sale or other title
retention agreement, any lease in the nature thereof, and
any agreement to give any security interest.
Loan
Documents:
this agreement, the Note, the Pledge Agreement, Parental
Guaranty, and all other instruments, documents and
agreements executed by or on behalf of Borrower,
Parent or any of their respective Subsidiaries and
delivered concurrently herewith or at any time
hereafter to or for the benefit of Lender in
connection with the Advances and other transactions
contemplated by this agreement, all as amended,
supplemented or modified from time to time.
Material
Adverse
Change: (a) a material adverse change in the business, assets,
prospects, operations or condition, financial or otherwise,
of the Borrower, Parent, or their respective Subsidiaries or
(b) material impairment of the ability of the Borrower to
perform its obligations under this letter agreement.
Maturity Date: 364 days from the date hereof.
MRR: monthly recurring alarm monitoring and extended
service plan revenues from services provided under
Subscriber Accounts, including patrol revenues.
Net Income: for any period, the net income (or loss)
of Borrower, Parent and their respective Subsidiaries
on a consolidated basis after provision for or
benefit from income and franchise taxes determined in
accordance with GAAP, but excluding: (a) the income
(or loss) of any Person (other than Borrower and its
wholly-owned Subsidiaries) in which Borrower, Parent
or any of their respective Subsidiaries has an
ownership interest unless received by Borrower,
Parent or any of their
- 24 -
respective Subsidiaries in a cash distribution; and
(b) the income (or loss) of any Person accrued prior
to the date it became a wholly-owned Subsidiary of
Borrower, Parent or any of their respective
Subsidiaries or is merged into or consolidated with
Borrower, Parent or any of their respective
Subsidiaries or such Person's assets are acquired by
Borrower, Parent or any of their respective
Subsidiaries.
Net Proceeds: cash proceeds (including insurance
proceeds) received by Borrower, Parent or any of
their respective Subsidiaries from any Asset
Disposition (including payments under notes or other
debt securities received in connection with any Asset
Disposition and insurance proceeds and awards of
condemnation but excluding proceeds permitted under
this agreement to be used for replacement assets),
net of (a) the costs of such sale, lease, transfer or
other disposition (including taxes attributable to
such sale lease or transfer); and (b) amounts applied
to repayment of Indebtedness (other than the
Obligations) secured by a Lien on the asset or
property disposed.
Obligations: all obligations, liabilities and
indebtedness of every nature of Borrower, Parent and
their respective Subsidiaries from time to time owed
to Lender under this agreement including the
principal amount of all debts, claims and
indebtedness, accrued and unpaid interest and all
fees, costs and expenses, whether primary, secondary,
direct, contingent, fixed or otherwise, heretofore,
now and/or from time to time hereafter owing, due or
payable whether before or after the filing of a
proceeding under the Bankruptcy Code by or against
either Borrower, Parent or any of their respective
Subsidiaries.
Parent's
Warrant
Agreement: collectively, (a) that certain Warrant
Agreement dated the November 3, 0000 xxxxxxx Xxxxxx
xxx Xxxxxx Xxxxxx Trust Company of New York, as
Warrant Agent and (b) that certain Warrant Agreement
dated May 17, 1995 between Parent and State Street
Bank and Trust Company, a successor to the
First National Bank of Boston, as Warrant Agent.
- 25 -
Parent's Warrants:
the warrants to purchase Parent's common stock pursuant to the Parent's Warrant
Agreement.
PBGC: the Pension Benefit Guaranty Corporation or any
successor thereto established under ERISA.
Permitted
Encumbrances: (a) Liens (other than Liens relating to
environmental claims or ERISA) for taxes, assessments
or other governmental charges not yet due and
payable; (b) statutory Liens of landlords, carriers,
warehousemen, mechanics, materialmen and other
similar liens imposed by law, which are incurred in
the ordinary course of business for sums not more
than 30 days delinquent or which are being contested
in good faith; provided that a reserve or other
appropriate provision shall have been made therefor;
(c) Liens (other than any Lien imposed by ERISA)
incurred or deposits made in the ordinary course of
business in connection with workers' compensation,
unemployment insurance and other types of social
security, or to secure the performance of tenders,
statutory obligations, surety, stay, customs and
appeal bonds, bids, leases, government contracts,
trade contracts, performance and return-of-money
bonds and other similar obligations (exclusive of
obligations for the payment of borrowed money); (d)
deposits, in an aggregate amount not to exceed
$200,000, made in the ordinary course of business to
secure real property leases and/or liability to
insurance carriers; (e) Liens for purchase money
obligations; provided that: (i) the purchase of the
asset subject to any such Lien is permitted under
this agreement; (ii) the Indebtedness secured by any
such Lien is permitted under this agreement; and
(iii) any such Lien encumbers only the asset so
purchased; (f) any attachment or judgment Lien not
constituting an Event of Default under this
agreement; (g) leases or subleases granted to others
not interfering in any material respect with the
business of Borrower, Parent or any of their
respective Subsidiaries; (h) easements,
rights-of-way, restrictions, and other similar
charges or encumbrances not interfering in any
material respect with the ordinary conduct of the
business of Borrower, Parent or
- 26 -
any of their respective Subsidiaries; (i) any
interest or title of a lessor or sublessor under any
lease permitted by this agreement; (j) Liens arising
from filing UCC financing statements regarding leases
permitted by this agreement; (k) Liens in favor of
Lender or on behalf of Lender; (l) Liens in favor of
Ion Leasing, Inc. to the extent such Liens encumber
only the cash (and any investment contracts and life
insurance policies purchased therewith) deposited by
Borrower in a segregated trust account to defease the
promissory note issued by Borrower to Ion Leasing
Inc. in accordance with the Ion Acquisition
Documents; and (m) Liens existing on the date hereof
and renewals and extensions thereof, which Liens are
set forth on Schedule A to this agreement.
Person: includes natural persons, corporations,
limited liability companies, limited partnerships,
general partnerships, joint stock companies, joint
ventures, associations, companies, trusts, banks,
trust companies, land trusts, business trusts or
other organizations, whether or not legal entities,
and governments and agencies and political
subdivisions thereof and their respective permitted
successors and assigns (or in the case of a
governmental person, the successor functional
equivalent of such Person).
Plan:any employee pension plan of Borrower, Parent or
any of their Subsidiaries subject to ERISA.
Redeemable
Stock: means any class or series of Capital Stock of
any Person that by its terms or otherwise is (i)
required to be redeemed prior to the Maturity Date,
(ii) redeemable at the option of the holder of such
class of series of Capital Stock at any time prior to
the Maturity Date or (iii) convertible into or
exchangeable for Capital Stock referred to in clause
(i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Maturity Date.
Related
- 27 -
Transactions: the execution and delivery of the Loan Documents, each
Advance on the Closing Date and the payment of all fees,
costs and expenses associated with all of the foregoing.
Subordinated
Discount Note
Documents:
the Subordinated Discount Note Placement Agreement, the
Subordinated Discount Note Indenture, the
Subordinated Discount Notes, and all instruments,
documents and agreements executed pursuant to the
terms of the foregoing.
Subordinated
Discount Note
Indenture: the Indenture dated as of May 17, 1995 by and among
State Street Bank and Trust Company, as successor to The
First National Bank of Boston, as trustee, Parent and
Borrower with respect to the Subordinated Discount Notes.
Subordinated
Discount Note
Placement
Agreement:
the Placement Agreement among Parent, Borrower and Xxxxxx Xxxxxxx and Co. and
Xxxxxxxxxx Securities with respect to the issuance and sale
of the Subordinated Discount Notes and the Parent warrants.
Subordinated
Discount
Notes: those Senior Subordinated Discount Notes Due
2005 of Borrower issued on May 17, 1995, and the
substantially identical subordinated notes registered
under the Securities Act of 1933 which were issued in
exchange for such initial Subordinated Discount
Notes, as contemplated by the Subordinated Discount
Note Documents.
Subscriber
Accounts: alarm monitoring accounts or alarm services accounts
of customers arising under written contracts with such
customers pursuant to which Borrower, Parent or any of their
respective Subsidiaries provides alarm monitoring or other
- 28 -
security services or sells, installs and services security
alarm systems.
Subsidiary: with respect to any Person, any
corporation, partnership association or other
business entity of which more than 50% of the total
voting power of shares of stock (or equivalent
ownership or controlling interest) entitled (without
regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly
or indirectly, by that Person or one or more of the
other Subsidiaries of that Person or a combination
thereof.
Term: with respect to a WIBOR Advance, the number of
days between the date of such WIBOR Advance and the
expiration date thereof, as selected by Borrower and
agreed to by Lender, but, unless Lender shall
otherwise agree, not in excess of 90 days.
Trade Payables: means, with respect to any Person, any accounts
payables or any other indebtedness or monetary
obligation to trade creditors created, assumed or
Guaranteed by
such Person or any of its Subsidiaries arising in the
ordinary course of business in connection with the
acquisition of goods or services.
Transition Costs: the costs and expenses incurred by Borrower, Parent
or any of their respective Subsidiaries in the
ordinary course of business and capitalized as
acquisition costs in connection with converting
acquired Subscriber Accounts to Subscriber
Accounts of Borrower, Parent or any of their
respective Subsidiaries.
Westar Security: Westar Security, Inc., a wholly-owned subsidiary of
Parent
WestSec: WestSec, Inc., a wholly-owned subsidiary of Borrower.
- 29 -
WIBOR
Rate: the fixed rate of interest offered by the Lender
on a WIBOR Advance.
WIBOR
Advance: an Advance bearing an interest rate based on the
WIBOR Rate.
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