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Exhibit 10.1
2/11/97
CREDIT AGREEMENT
BETWEEN
THE O'GARA COMPANY
X'XXXX-XXXX & XXXXXXXXXX
ARMORING COMPANY
O'GARA SATELLITE NETWORKS, INC.
O'GARA SATELLITE NETWORKS LIMITED,
BORROWERS
AND
THE FIFTH THIRD BANK
LASALLE NATIONAL BANK,
LENDERS
AND
THE FIFTH THIRD BANK,
AS AGENT
DATED FEBRUARY 11, 1997
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TABLE OF CONTENTS
Page
Section 1. Definitions..................................................................1
Section 2. Loans........................................................................1
2.1. Revolving Credit Loans. ...........................................1
2.2. Term Loan. .......................................................3
2.3. Fees................................................................5
2.4. Interest............................................................5
2.5. Applicable Margins..................................................7
2.6. Commercial Letter of Credit Facility................................8
2.7. IRB Letter of Credit................................................9
2.8. Letter of Credit Costs.............................................10
2.9. Actions Relating to the Letter of Credit Liability of Banks........10
2.10. Letter of Credit Indemnification...................................11
2.11. Increased Costs, Etc...............................................11
2.12. Payments...........................................................12
2.13. Maximum Interest Rate..............................................12
2.14. Joint and Several Liability; Parent as Agent.......................13
2.15. Defaulting Bank....................................................15
Section 3. Representations And Warranties..............................................15
3.1. Organization and Qualification.....................................15
3.2. Due Authorization..................................................15
3.3. Litigation.........................................................15
3.4. Margin Stock.......................................................15
3.5. Business...........................................................16
3.6. Licenses, etc......................................................16
3.7. Laws and Taxes.....................................................16
3.8. Financial Condition................................................16
3.9. Title..............................................................16
3.10. Defaults...........................................................17
3.11. Environmental Laws.................................................17
3.12. Subsidiaries and Partnerships......................................18
3.13. ERISA..............................................................18
3.14. Solvency...........................................................18
Section 4. Affirmative Covenants.......................................................18
4.1. Books and Records..................................................18
4.2. Financial Statements...............................................18
4.3. Condition and Repair...............................................20
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4.4. Insurance..........................................................20
4.5. Taxes..............................................................20
4.6. Existence; Business................................................21
4.7. Compliance with Laws...............................................21
4.8. Notice of Default..................................................21
4.9. Costs..............................................................21
4.10. Depository/Banking Services........................................21
4.11. Other Amounts Deemed Loans.........................................22
4.12. French Documents...................................................22
4.13. Next Destination...................................................22
4.14. Life Insurance.....................................................22
Section 5. Negative Covenants..........................................................22
5.1. Prepayments........................................................22
5.2. Pledge or Encumbrance of Assets....................................22
5.3. Guarantees and Loans...............................................23
5.4. Merger; Disposition of Assets......................................23
5.5. Transactions with Affiliates.......................................23
5.6. Investments........................................................23
5.7. Foreign Investments................................................23
5.8. Indebtedness to Tangible Net Worth.................................23
5.9. Tangible Net Worth.................................................24
5.10. Debt Service Coverage Ratio........................................24
5.11. Current Ratio......................................................24
5.12. Cash Flow Coverage.................................................24
5.13. Indebtedness. .....................................................24
5.14. Capital Expenditures...............................................25
5.15. Dividends. .......................................................24
5.16. Interest Rate Protection...........................................24
Section 6. Events of Default and Remedies..............................................25
6.1. Events of Default..................................................25
6.2. Remedies...........................................................27
6.3. Setoff.............................................................27
6.4. Default Rate.......................................................28
6.5. Late Payment Penalty...............................................28
6.6. No Remedy Exclusive................................................28
6.7. Effect of Termination..............................................28
Section 7. Conditions Precedent........................................................28
7.1. Conditions to Initial Loans........................................28
7.2. Conditions to Each Revolving Loan..................................29
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Section 8. Agent.......................................................................30
8.1. Appointment........................................................30
8.2. Delegation of Duties. .............................................30
8.3. Exculpatory Provisions.............................................30
8.4. Reliance by Agent..................................................31
8.5. Notice of Default..................................................31
8.6. Non-Reliance on Agent and Other Banks..............................31
8.7. Indemnification....................................................32
8.8. Agent in Its Individual Capacity...................................33
8.9. Successor Agent....................................................33
8.10. Amendments and Waivers.............................................33
8.11. Setoff; Sharing....................................................34
8.12. Enforcement........................................................35
Section 9. Miscellaneous Provisions....................................................35
9.1. Miscellaneous......................................................35
9.2. Waiver by Borrower.................................................35
9.3. Binding Effect.....................................................35
9.4. Security...........................................................35
9.5. Survival...........................................................35
9.6. Delay or Omission..................................................36
9.7. Notices............................................................36
9.8. No Partnership.....................................................36
9.9. Indemnification....................................................36
9.10. Setoff.............................................................37
9.11. Taxes and Fees.....................................................37
9.12. Expenses of Agent and Banks........................................37
9.13. Governing Law; Jurisdiction........................................37
9.14. Confession of Judgment.............................................38
EXHIBIT 1 DEFINITIONS........................................................42
EXHIBIT 2.1 FORM OF REVOLVING NOTE.............................................50
EXHIBIT 2.2 FORM OF TERM NOTE..................................................53
EXHIBIT 2.4 BORROWING CONFIRMATION.............................................56
EXHIBIT 2.6 FORM OF LETTER OF CREDIT NOTE......................................57
EXHIBIT 3.3 LITIGATION.........................................................61
EXHIBIT 3.9 LIENS..............................................................62
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EXHIBIT 3.12 SUBSIDIARIES AND PARTNERSHIPS......................................70
EXHIBIT 7.1(b) CERTIFICATE OF BORROWER............................................72
EXHIBIT 7.1(c) OPINION OF COUNSEL FOR BORROWER....................................74
EXHIBIT 7.2 COLLATERAL REPORT..................................................76
EXHIBIT 8.5 SECURITY AGREEMENT.................................................78
SCHEDULE I SPECIFIC REPRESENTATIONS...........................................87
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CREDIT AGREEMENT
This Credit Agreement (the "Agreement") is entered into as of
February 11, 1997 between THE O'GARA COMPANY, an Ohio corporation ("Parent"),
X'XXXX-XXXX & XXXXXXXXXX ARMORING COMPANY, a Delaware corporation
("Armoring"), O'GARA SATELLITE NETWORKS, INC., a Delaware corporation
("Satellite"), O'GARA SATELLITE NETWORKS LIMITED, an Irish corporation
("Irish") (collectively, the "Borrowers" and individually a "Borrower"), and
THE FIFTH THIRD BANK, an Ohio banking corporation ("Fifth Third"), and LASALLE
NATIONAL BANK, a national banking association ("LaSalle") (Fifth Third and
LaSalle are collectively referred to as "Banks" and individually as a "Bank"),
and THE FIFTH THIRD BANK, as agent for the Banks ("Agent").
Section 1. DEFINITIONS.
Certain capitalized terms have the meanings set forth on
Exhibit 1 hereto or in the Security Agreement. All financial terms used in
this Agreement but not defined on Exhibit 1 or in the Security Agreement have
the meanings given to them by generally accepted accounting principles. All
other undefined terms have the meanings given to them in the Ohio Uniform
Commercial Code.
Section 2. LOANS.
2.1. REVOLVING CREDIT LOANS.
(a) Subject to the terms and conditions hereof, each
Bank severally hereby extends to Borrowers a line of credit facility (the
"Revolving Credit Facility") under which Banks will make loans (the "Revolving
Loans") to Borrowers at Parent's request and direction from time to time during
the term of this Agreement in an amount up to the lesser of: (i) $12,000,000 or
(ii) the sum of seventy percent (70%) of the net amount of Eligible Accounts
plus 40% of Eligible Inventory. Borrowers may borrow, prepay (without penalty or
charge), and reborrow under the Revolving Credit Facility, provided that the
principal amount of all Revolving Loans outstanding at any one time under the
Revolving Credit Facility will not exceed the limits set forth in this clause
(a). If the principal amount of Revolving Loans outstanding at any time under
the Revolving Credit Facility exceeds the limit set forth in this clause (a),
Borrowers will immediately upon receiving notice thereof from Agent pay the
amount of such excess to Agent in cash. In the event Borrowers fail to promptly
pay such excess, any Bank may, in its discretion, setoff such amount against any
Borrower's accounts at such Bank. Banks will make Revolving Loans by crediting
the amount thereof to either Parent's account at Agent or such account at Agent
of any other Borrower as directed by Parent.
(b) (i) Subject to Section 2.1(f) hereof, Parent may
request Revolving Loans on any Monday or Thursday that is a Business Day (or the
next Business Day if such Monday or Thursday is not a Business Day) by giving
the Agent irrevocable written notice on or before 11:00 a.m., prevailing
Cincinnati, Ohio time, on such day. Each loan request shall specify (A) the
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requested borrowing date, which shall be a Business Day, and (B) the aggregate
amount of such Loan. The Agent, promptly upon receipt of any loan request,
shall give notice thereof to the Banks.
(ii) Each Bank shall provide the Agent with
funds, on or before 4:00 p.m., prevailing Cincinnati, Ohio time, on each
borrowing date in an amount equal to such Bank's pro-rata share of the requested
Revolving Loans by transferring same day or immediately available funds to such
account as the Agent shall specify from time to time by notice to the Banks. On
the date requested in such notice, the Agent shall make available to the
Borrowers, in immediately available funds, the proceeds of the Revolving Loans
being made; PROVIDED, HOWEVER, that the Agent shall be obligated to make the
proceeds of such Revolving Loans available only to the extent received by it
from the Banks. No Bank's obligation to fund any Revolving Loan shall be
affected by any other Bank's failure to fund any Revolving Loan.
(iii) In the event that the Agent remits
in same day or immediately available funds to any Bank its share of any payments
to be made by any Borrower pursuant to this Agreement, the Revolving Note or the
Term Note prior to the time when the Agent receives such payments from such
Borrower, and such Borrower fails to make such payments when due, immediately
upon receipt of notice from the Agent, such Bank shall repay directly to the
Agent in same day or immediately available funds such amount as will equal the
amount that such Borrower failed to pay together with interest thereon at a rate
per annum equal to (A) if paid within one Business Day, the overnight Federal
Funds Rate, or (B) if not paid within one Business Day, the Prime Rate as then
in effect. In either case, the foregoing shall not be deemed to affect the
obligation of such Borrowers to pay interest at the applicable rate provided
herein.
(iv) If Agent advances to Borrowers any
portion of Revolving Loans requested by Parent before the corresponding amount
has been received by Agent from the Banks which are to send such moneys to
Agent, and Agent does not receive the corresponding amount from the relevant
Bank when due, then the relevant Bank shall immediately pay such sum to Agent,
with interest at the rate set forth in Section 2.15 hereof; and upon demand from
Agent, Borrowers shall repay to Agent the amount not paid to Agent by such Bank,
with interest at the rate applicable for Revolving Loans. If any Bank fails to
make a Revolving Loan to be made by it hereunder, no other Bank shall be
responsible for such failure or be required to advance such sum to Borrowers but
such non-Defaulting Bank shall use its best efforts to obtain a substitute bank
or participant.
(c) On the date hereof and within twenty (20)
days after each month end thereafter, and as otherwise required by Agent, Parent
shall deliver to Agent a Collateral Report in the form of Exhibit 7.2 hereto.
(d) The Revolving Loan proceeds will be used
for:
(i) general corporate and working
capital purposes;
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(ii) intercompany loans to any direct or
indirect Subsidiaries of a Borrower, including without limitation, O'Gara
France, S.A., Xxxxx and the other companies to be directly or indirectly owed by
O'Gara France, S.A. after completion of the Xxxxx Transaction (subject to the
limitations contained in Section 5.7 of this Agreement); and
(iii) such other purposes as approved by
Agent in writing.
(e) On the date hereof, Borrowers will duly
issue and deliver to each Bank a Revolving Note in the form of Exhibit 2.1
(collectively, the "Revolving Note"), in the principal amount of $6,000,000,
bearing interest as specified in Section 2.4 of this Agreement.
(f) The term of the Revolving Credit Facility
will expire on February 11, 1998, and the Revolving Note will become payable in
full on that date. Borrowers may prepay the principal balance of the Revolving
Note in whole or part at any time.
(g) So long as this Agreement is in effect,
Borrowers will pay to Agent for the pro-rata benefit of Banks an unused facility
fee at an annual rate equal to one-quarter of one percent (.25%) of that portion
of the Revolving Credit Facility that is not outstanding on each day (the
"Unused Facility Fee"), which will be payable on the first (1st) day of each
calendar month in arrears for the previous calendar month with a final payment
due on the termination of this Agreement; provided, however, that the Unused
Facility Fee shall be 0.375% for any period of time at which the Leverage Ratio
exceeds 7.5:1.0.
2.2. TERM LOAN.
(a) Banks agree on the terms and conditions
hereinafter set forth, to make a term loan (the "Term Loan") to Borrowers on the
date of this Agreement (or such later date in one lump sum as specified by
Parent) in the principal sum of Sixteen Million Thousand Dollars ($16,000,000).
Borrowers' obligation to repay the Term Loan shall be evidenced by their two
promissory notes (collectively, the "Term Note") in the principal amount of
Eight Million Dollars ($8,000,000.00) each in substantially the form of Exhibit
2.2 hereto. The Term Note shall be dated the date of this Agreement. The
principal amount of the Term Note will be payable in 20 quarterly installments,
due on the 1st day of each quarter as set forth below in Section 2.2(b).
(b) The aggregate principal amount of the Term
Loan shall be paid as follows:
PAYMENT DATE AMOUNT
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July 1, 1997 $500,000
October 1, 1997 $500,000
January 1, 1998 $750,000
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PAYMENT DATE AMOUNT
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April 1, 1998 $750,000
July 1, 1998 $750,000
October 1, 1998 $750,000
January 1, 1999 $750,000
April 1, 1999 $750,000
July 1, 1999 $750,000
October 1, 1999 $750,000
January 1, 2000 $750,000
April 1, 2000 $750,000
July 1, 2000 $875,000
October 1, 2000 $875,000
January 1, 2001 $875,000
April 1, 2001 $875,000
July 1, 2001 $1,000,000
October 1, 2001 $1,000,000
January 1, 2002 $2,000,000
or the then unpaid
principal balance of the
Term Loan
(c) On or prior to the later of the expiration
date for the then current Pricing Option for the Term Loan or the 105th day
following the end of each fiscal year during which the Leverage Ratio was
2.5:1.0 or greater, Borrowers shall prepay principal of, the Term Loan in an
amount equal to fifty percent (50%) the Excess Cash Flow for the Borrowers' then
immediately preceding year. The principal amount of such prepayment shall be
applied to the principal of the Term Loan, in inverse order of maturity.
(d) Borrowers shall pay interest to Agent for
the benefit of Banks on the outstanding principal amount of the Term Loan at the
applicable rate specified in Section 2.4 of this Agreement. Interest shall be
calculated on the basis of a year of 360 days, and charged for the actual number
of days elapsed. Interest shall be payable in immediately available funds at the
principal office of Agent, on the date of each principal payment. After the
occurrence of an Event of Default, the Term Loan shall bear interest until paid
at a rate which shall be 6% above the rate that would otherwise be in effect;
this provision does not constitute a waiver of any Events of Default or an
agreement by Agent or any Bank to permit any late payments whatsoever.
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(e) Borrowers may, upon at least 3 days' notice
to Agent, prepay the Term Loan in whole or in part with accrued interest on the
amount prepaid, provided that each partial payment shall be in a principal
amount of not less than Five Thousand Dollars ($5,000) and shall be applied to
the principal installments of the Term Loan in the inverse order of their
maturity.
2.3. FEES. In addition to the other fees set forth in
this Agreement, Borrowers shall pay the following:
(a) Revolving Loans Commitment Fee: On the
date hereof, Borrowers shall pay to Agent for the pro-rata benefit of Banks a
nonrefundable closing fee of $240,000 as a commitment for the Revolving Loans.
(b) Term Loan Commitment Fee: On the date
hereof, Borrowers shall pay to Agent for the pro-rata benefit of Banks a
nonrefundable closing fee of $60,000 as a commitment fee for the Term Loan.
2.4. INTEREST.
(a) Subject to the terms and conditions of this
Agreement, the Revolving Credit Loans and the Term Loan (collectively the
"Pricing Loans") shall bear interest as follows:
(i) on amounts subject to a Pricing
Option, at an annual rate equal to the LIBOR Rate plus the Applicable LIBOR
Margin; and
(ii) on amounts not subject to a Pricing
Option, at an annual rate equal to the Prime Rate plus the Applicable Prime
Margin in effect on each date.
(b) Subject to the terms and conditions of this
Agreement, Parent for the benefit of Borrowers may from time to time elect to
have a Pricing Option apply to a portion of the principal amount of outstanding
Pricing Loans, as specified by Parent, for a permissible LIBOR Interest Period
specified by Parent. Parent shall make each such election by giving notice
(which notice shall be irrevocable) to Agent, not later than 11:00 a.m. on the
proposed date for Revolving Loans or part of the Term Loan not then subject to
the Pricing Option, and not later than 11:00 a.m. on the third Business Day
prior to the proposed date for Revolving Loans or part of the Term Loan then
subject to a Pricing Option. Such notice shall specify the principal amount of
the Revolving Loans then to be made on such date, the principal amount of the
Term Loans (if any) subject to the notice and shall specify whether a Pricing
Option is to apply to such Pricing Loans. The amount of the Revolving Loans
subject to a Pricing Option to be made on any Borrowing Date shall be at least
One Million 00/100 Dollars ($1,000,000.00). In addition, Parent shall send Agent
a Borrowing Confirmation in the form of Exhibit 2.4 hereto within one Business
Day after the date of each pricing.
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(c) Parent's right to elect a Pricing Option for any
portion of outstanding Pricing Loans is subject to the following limitations:
(i) the total number of Pricing Options outstanding at any one time under this
Agreement shall not exceed five; (ii) Parent may not elect a Pricing Option at
a time when an Event of Default has occurred and has not been waived; (iii) no
LIBOR Interest Period shall end later than the maturity date of the respective
Note evidencing the borrowing of the relevant principal amount; (iv) the
principal amount that can be subject to a Pricing Option is $1,000,000; and
(v) once a Pricing Option has been selected for a portion of the Pricing
Loans, no other Pricing Option may apply to such portion until the expiration
of the LIBOR Interest Period applicable to the first Pricing Option.
(d) Interest on the principal amount subject to a Pricing
Option is payable on the last day of the relevant LIBOR Interest Period.
Interest on the principal amount of Pricing Loans not subject to a Pricing
Option is payable quarterly, commencing April 1, 1997 and on each July 1,
October 1 and January 1 thereafter until maturity of the Pricing Loans. Agent
and Borrowers shall attempt to procure a Pricing Option from the date hereof
to and through April 1, 1997.
(e) Interest on the Pricing Loans shall be computed on the
basis of a 360- day year and charged for the actual number of days involved.
The interest rate applicable to amounts not subject to any Pricing Option
shall change automatically upon each change in the Prime Rate. Upon the
occurrence of an Event of Default and until such Event of Default is waived,
the Pricing Loans shall bear interest at the Borrower Default Rate; this
provision does not constitute a waiver of any Event of Default or an agreement
by Bank to permit any late payments whatsoever.
(f) Borrowers shall have the right to prepay the Pricing
Loans in whole at any time, or in part from time to time, without premium or
penalty, provided that, at any time when a Pricing Option is in effect, no
prepayment of such portion of the principal amount of the Pricing Loans as is
subject to such Pricing Option shall be made except on the last day of the
applicable Interest Period unless an amount necessary to compensate a Bank for
costs, losses and expenses resulting from such prepayment (as reasonably
determined by such Bank) is paid by Borrowers to Agent. Each notice of
prepayment shall be irrevocable and shall obligate Borrowers to prepay the
amount stated therein on the date stated therein.
(g) Parent's right to elect a LIBOR Pricing Option shall
be terminated automatically for such period that Eurodollar deposits which
have a maturity corresponding to the proposed LIBOR Interest Period, in an
amount equal to the amount requested by Borrowers to be subject to a LIBOR
Pricing Option, are not readily available in the London Inter-Bank
Eurocurrency Market, or for such period that, by reason of circumstances
affecting such market, adequate and reasonable methods do not exist for
ascertaining the interest rate applicable to such deposits for the proposed
LIBOR Interest Period.
(h) Notwithstanding anything herein contained to the
contrary, if at any time any change in any law, regulation or official
directive, or in the interpretation thereof, by any governmental body charged
with the administration thereof, shall make it unlawful, or any central
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bank or other governmental authority shall assert that it is unlawful, for a
Bank to fund or maintain its funding in Eurodollars of any portion of the
principal amount of the Pricing Loans or otherwise to give effect to a Bank's
obligations as contemplated hereby, (i) such Bank may by facsimile or other
written notice thereof to Parent for the benefit of Borrowers declare such
Bank's obligations in respect of the LIBOR Pricing Option to be terminated
forthwith for the period that such Bank can no longer do LIBOR Options, and
(ii) all LIBOR Pricing Options then in effect shall forthwith cease to be in
effect, and interest shall from and after such date be calculated at the
interest rate applicable to amounts to which no Pricing Option applies; and
(iii) Parent's right to elect LIBOR Pricing Options for Borrowers is
terminated until Agent notifies Parent that Borrowers' right to elect LIBOR
Pricing Options is reinstated.
2.5. APPLICABLE MARGINS.
(a) The Applicable LIBOR Margin and Applicable Prime
Margin expressed as a percentage, in effect on any date shall be determined
based on the higher of the Leverage Ratio (Section 5.8) and Cash Flow Coverage
("Cash Flow Coverage") (Section 5.12) of Parent on a consolidated basis (which
shall be specified in the chart below and determined pursuant to clause (b) of
this paragraph), as follows:
HIGHER OF APPLICABLE APPLICABLE
CASH FLOW COVERAGE LEVERAGE RATIO LIBOR MARGIN PRIME MARGIN
2.0 or greater 7.5 or greater 3.50% 1.25%
2.0 or greater 5.0 to 7.49 3.25% 1.00%
1.5 to 1.99 3.5 to 4.99 3.00% 0.75%
1.0 to 1.49 2.0 to 3.49 2.75% 0.50%
.99 or less less than 2.0 2.25% 0.00%
(b) The Leverage Ratio and Cash Flow Coverage in effect on
a certain date is determined by the Agent based upon the financial statements
and Compliance Certificate delivered to the Agent pursuant to Section 4.2
hereof; provided, however, if such financial statements and Compliance
Certificate are not delivered on a timely basis as provided in said Section
4.2, are not accurate and correct, or are not prepared in accordance with the
financial statement and other requirements of this Agreement, then the
Leverage Ratio and Cash Flow Coverage shall be recalculated by the Agent and
determined by the Agent in its sole judgment. If the Leverage Ratio and Cash
Flow Coverage as provided in Borrowers' financial statements and Compliance
Certificate or as recalculated by the Agent requires a change in the
Applicable Margin, the Applicable Prime Margin will change accordingly
starting on the first day of the calendar quarter following Agent's receipt of
such financial statements, and the Applicable LIBOR Margin will change
accordingly effective for LIBOR Interest Periods that start on the first day
of the calendar quarter following Agent's receipt of such financial
statements. Notwithstanding the foregoing, the Applicable LIBOR
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Margin in effect on the first day of the LIBOR Interest Period applicable to a
Pricing Option shall remain in effect for such entire LIBOR Interest Period
with respect to the amount of Pricing Loans subject to such Pricing Option.
(c) If there has been a miscalculation of the Leverage
Ratio or Cash Flow Coverage or if any financial statements of Borrowers are
later determined to have been incorrect, and if the Leverage Ratio and Cash
Flow Coverage determined pursuant to the correct information would result in a
greater amount owing by Borrowers for the relevant period than had been
actually paid by Borrowers for such period, Borrowers shall pay to Agent for
the benefit of the Banks upon demand, the difference between the amount
actually paid for the relevant period and the amount owed based on the
Leverage Ratio and Cash Flow Coverage as corrected determined pursuant to the
correct information, together with interest on the amount owed at the Default
Rate.
(d) If there has been any miscalculation of the Leverage
Ratio or the Cash Flow Coverage, and if the Leverage Ratio and Cash Flow
Coverage determined pursuant to such information would result in a lesser
amount owing by Borrowers for the relevant period than had been actually paid
by Borrowers for such period, Banks shall rebate or credit the difference to
Borrowers between the amount actually paid for the relevant period and the
amount owed based on the Leverage Ratio and Cash Flow Coverage as corrected or
as determined pursuant to the changed information. However, interest will only
be rebated or credited to Borrowers if the credit or rebate is based upon a
clerical error and such claim is made to Agent within sixty (60) days of the
date the interest is paid. For purposes of this clause (d), the calculations
shall be presumed correct absent manifest error.
2.6. COMMERCIAL LETTER OF CREDIT FACILITY.
(a) Banks hereby grant to Borrowers a letter of credit
facility (the "Commercial Letter of Credit Facility") under which a Borrower
or any Subsidiaries may, from time to time and at Parent's request, obtain
standby letters of credit and commercial letters of credit from the Issuing
Bank (the "Commercial Letters of Credit" and individually a "Commercial Letter
of Credit") in an aggregate amount not to exceed $4,000,000 outstanding at any
one time (the "Commercial Letter of Credit Facility"). The Commercial Letters
of Credit shall be in favor of such beneficiaries (collectively the
"Beneficiaries" and each a "Beneficiary") and for such purposes as an
authorized representative of such Borrower or Parent specifies, and provided
that no Letters of Credit shall have a term one year beyond its date of issue.
(b) All advances to the holder of any Commercial Letter of
Credit will be funded by advances under a Letter of Credit Note from Borrowers
to the Issuing Bank in the form attached hereto as Exhibit 2.6 (the "Letter of
Credit Note"). In the event that the Issuing Bank pays any amount under or on
account of any Commercial Letter of Credit issued by it (the payment by the
Issuing Bank under or on account of a Commercial Letter of Credit being herein
called a "Draw"), a Revolving Loan by Banks shall be made to Borrowers in a
total amount equal to the amount of such Draw to reimburse the Issuing Bank
for such Draw which shall be evidenced by the
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Revolving Note; provided, however, if the entire principal amount of the
Revolving Loans is then outstanding, then the amount of such Draw shall be
evidenced as an amount outstanding under the Letter of Credit Note, bearing
interest as specified therein. Each Borrower hereby irrevocably requests that
such Revolving Loans be made and irrevocably authorizes Agent to apply the
proceeds of such Revolving Loans to immediately reimburse the Issuing Bank for
the amount of the Draw, to the extent available or as soon as amounts become
available under the Revolving Credit Facility.
(c) Prior to the date of issuance of any Commercial Letter
of Credit, each Borrower agrees to execute a Letter of Credit Application for
each Commercial Letter of Credit (the "Applications"). The obligations of
Borrowers with respect to any Commercial Letter of Credit shall include the
terms of the application for such Commercial Letter of Credit and any other
documentation executed between the Issuing Bank and Borrowers with respect to
such Commercial Letter of Credit.
(d) Borrowers agree to pay to the Issuing Bank (for the
pro-rata benefit of Banks in accordance with their percentages of the
Revolving Loans), a non-refundable fee of one and one-half percent (1.50%) per
annum of the amount of each new Commercial Letter of Credit or each extension
of the expiration date of a Commercial Letter of Credit. Borrowers agree to
pay a non-refundable fee for each new Commercial Letter of Credit or each
extension of a Commercial Letter of Credit based upon the Issuing Bank's
Commercial Letter of Credit Fee Schedule to be delivered to Borrowers from
time to time, as applicable to all other customers of the Issuing Bank. The
fee shall be payable on or before the issuance of each Commercial Letter of
Credit.
(e) The obligations of Borrowers to Banks and the Issuing
Bank under this Agreement with respect to each Commercial Letter of Credit
shall be absolute, unconditional and irrevocable, and shall be paid and
performed strictly in accordance with the terms of this Agreement, under all
circumstances whatsoever.
(f) The proceeds of the Commercial Letter of Credit(s)
will be used for general business purposes of Borrowers or its Subsidiaries.
(g) The Commercial Letter of Credit Facility shall expire
on the maturity date of the Revolving Credit Facility, as specified in Section
2.1 of this Agreement.
2.7. IRB LETTER OF CREDIT.
(a) Banks hereby grant to Borrowers a letter of credit
facility (the "IRB Letter of Credit Facility") under which Parent may, at its
request, obtain a letter of credit from the Issuing Bank (the "IRB Letter of
Credit") in an aggregate principal amount of coverage not to exceed
$1,500,000. The IRB Letter of Credit shall be in favor of the trustee for the
Bonds, and shall have an expiration date as the Issuing Bank and Parent agree.
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(b) All advances to the holder of any IRB Letter of Credit
shall be subject to the Reimbursement Agreement.
(c) Prior to the date of issuance of the IRB Letter of
Credit, each Borrower agrees to execute the Reimbursement Agreement and any
related security documents or assignments reasonably required by the Issuing
Bank. The obligations of Borrowers with respect to the IRB Letter of Credit
shall include the terms of the Reimbursement Agreement.
(d) Borrowers agree to pay to the Issuing Bank (for the
pro-rata benefit of Banks), a non-refundable fee equal to one and one-half
(1.50%) per annum of the amount of the IRB Letter of Credit or each extension
of the expiration date of the IRB Letter of Credit. This annual fee shall be
payable in advance in quarterly installments.
(e) The obligations of Borrowers to the Issuing Bank under
this Agreement with respect to the IRB Letter of Credit shall be absolute,
unconditional and irrevocable, and shall be paid and performed strictly in
accordance with the terms of this Agreement and the Reimbursement Agreement,
under all circumstances whatsoever.
(f) The IRB Letter of Credit will be used for the purpose
of securing a Borrowers' obligations with respect to the Bonds.
2.8. LETTER OF CREDIT COSTS. If any change in any law or
regulation or in the interpretation thereof by any court or administrative
agency shall either (i) impose, modify or deem applicable any reserve, special
deposit or similar requirement against letters of credit issued by a Bank or
(ii) impose on any Bank any other condition regarding this Agreement or the
Letters of Credit (other than changes in the rates of income taxation
generally applicable to such Bank), and the result of any such event shall be
to increase the costs of a Bank for issuing or maintaining the Letters of
Credit (which increases in cost shall be determined by such Bank's reasonable
allocation of the aggregate of such cost increases resulting from such events,
other than increases which result solely from such Bank's acts or omissions,
then (a) such Bank shall so notify Parent for the benefit of Borrowers and (b)
upon receipt of such notice from Bank, Borrowers shall promptly pay to such
Bank, from time to time as specified by such Bank, additional amounts which
shall be sufficient to compensate it for such increased costs, together with
interest on each such amount from the date of such notice until payment in
full thereof at the rate then applicable to Revolving Loans not subject to a
Pricing Option. A certificate setting forth in reasonable detail such
increased cost incurred by a Bank as a result of any such event and that such
increased costs are being charged to its other similarly-situated letter of
credit customers, submitted to Borrowers shall be prima facie evidence, absent
manifest error, as to the amount thereof.
2.9. ACTIONS RELATING TO THE LETTER OF CREDIT LIABILITY OF
BANKS. Any action taken or omitted by any Bank, under or in connection with
the Letters of Credit or sight drafts or documents relating thereto, if taken
or omitted without gross negligence or willful misconduct, shall be binding
upon Borrowers and shall not result in a Bank being under any liability to
Borrowers.
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Each Borrower assumes all risks of the acts or omissions of the beneficiaries
of such Letters of Credit, a Bank or any permitted transferee of the Letters
of Credit with respect to its use of the Letters of Credit, if such acts or
omissions are without negligence or wilful misconduct. Neither a Bank nor any
of its officers or directors will be liable or responsible for: (a) the use
which may be made of the Letters of Credit or for any acts or omissions of any
Beneficiary and any permitted transferee in connection therewith; (b) the
validity, sufficiency or genuineness of documents, or of any endorsement(s)
thereon, even if such documents should in fact prove to be in any or all
respects invalid, insufficient, fraudulent or forged; (c) any other
circumstances whatsoever in making or failing to make payment under the
Letters of Credit, except only damages which a Borrower proves were caused by
(i) any Bank's willful misconduct or gross negligence in determining whether a
sight draft or other documents presented under the Letters of Credit comply
with the terms of the Letters of Credit or (ii) any Bank's willful or gross
negligent failure to pay under the Letter(s) of Credit after the presentation
to it by a beneficiary (or a permitted successor to whom the Letter(s) of
Credit has been transferred in accordance with its terms) of a sight draft and
documents strictly complying with the terms and conditions of such Letter of
Credit. In furtherance and not in limitation of the foregoing, any Bank may
accept documents that appear on their face to be in order, without
responsibility for further investigation.
2.10. LETTER OF CREDIT INDEMNIFICATION. Each Borrower hereby
agrees at all times to protect, defend, indemnify, save and hold harmless
Banks from and against any and all claims, actions, suits and other legal
proceedings, and from and against any and all losses, claims, demands,
liabilities, damages, charges, counsel fees, interest and penalties and other
expenses which Banks may, at any time, sustain or incur by reason of or in
consequence of or arising out of any Letter of Credit or the use (or the
proposed or potential use) of the proceeds of any drawing under such Letter of
Credit or any increased costs incurred by Banks (and being charged to all other
similarly-situated customers of such Bank) due to any change in law or
regulations governing Banks or letters of credit in general; provided that
Borrowers shall not be required to indemnify a Bank for any claims, damages,
losses, liabilities, costs or expenses to the extent, but only to the extent,
caused by (i) the willful misconduct or gross negligence of a Bank in
determining whether a sight draft or other documents presented under any Letter
of Credit complied with the terms of such Letter of Credit or (ii) such Bank's
willful or gross negligent failure to pay under such Letter of Credit after the
presentation to it by the Beneficiary (or a successor to whom the Letter of
Credit has been transferred in accordance with its terms) of a sight draft and
documents strictly complying with the terms and conditions of such Letter of
Credit. Notwithstanding any of the foregoing, a Bank shall not, in any way, be
liable for any failure by such Bank to pay any sight draft under any Letter of
Credit as a result of any act of a governmental authority or any other cause
beyond the reasonable control of that Bank.
2.11. INCREASED COSTS, ETC.
(a) If, due to either (i) the introduction of or any
change in or in the interpretation of any law or regulation or (ii) the
compliance with a guideline or request from any central bank or other
governmental authority (whether or not having the force of law), there shall
be
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any increase in the cost to a Bank of agreeing to make or of making, funding
or maintaining Pricing Loans subject to the LIBOR Pricing Option and such Bank
charges similar increases to other similarly-situated borrowers, then from
time to time, upon written demand by such Bank (a copy of which shall be sent
to Parent) Borrowers shall pay to such Bank additional amounts sufficient to
compensate it for such increased cost. A certificate as to the amount of such
increased cost submitted to Parent by such Bank shall be conclusive and
binding for all purposes, absent manifest error.
(b) If a Bank determines that compliance with any law or
regulation or any guideline or request from any central bank or other
governmental authority (whether or not having the force of law) affects or
would affect the amount of capital required or expected to be maintained by
such Bank or any corporation controlling it and that amount of such capital is
increased by the existence of its commitment to lend or issue Letters of
Credit hereunder and other commitments of such type or by the existence of
outstanding Pricing Loans or Letters of Credit (or similar obligations), and
such Bank charges similar increases to similarly-situated borrowers then, upon
written demand by such Bank (a copy of which shall be sent to Parent),
Borrowers shall pay to such Bank, from time to time as specified by it,
additional amounts sufficient to compensate it in the light of such
circumstances, to the extent that it reasonably determines such increase in
capital to be allocated to the existence of such Bank's Loans or commitment to
lend hereunder or to the issuance or maintenance of any Letters of Credit. A
certificate as to such amounts submitted to Parent by Bank shall be conclusive
and binding for all purposes, absent manifest error.
2.12. PAYMENTS. Each payment, including each pre-payment, of
principal and interest on the Notes shall be made by Borrowers to Agent (for
the pro-rata benefit of Banks) at its office set forth in Section 8.7 hereof
in immediately available funds by noon, Cincinnati time, on the due date for
such payment. The failure of Borrowers to make any such payment by noon,
Cincinnati time, shall not constitute a default hereunder, provided that such
payment is made on such due date, but any such payment made after noon,
Cincinnati time, on such due date shall be deemed to have been made on the
next Business Day for the purpose of calculating interest on amounts
outstanding on the Notes. If any payment hereunder or under the Notes shall be
due and payable on a day which is not a Business Day the maturity thereof
shall, except as otherwise provided in the definition of LIBOR Interest
Period, be extended to the next Business Day, and interest shall be payable at
the applicable rate specified herein during such extension.
2.13. MAXIMUM INTEREST RATE. In no event shall the interest rate
and other charges hereunder exceed the highest rate permissible under any law
which a court of competent jurisdiction shall, in a final determination, deem
applicable hereto. In the event that a court determines that Banks have
received interest and other charges hereunder in excess of the highest
permissible rate applicable hereto, such excess shall be deemed received on
account of, and shall automatically be applied to reduce, the principal
balance of the Loans (Revolving Loans first, then the Term Loan), and the
provisions hereof shall be deemed amended to provide for the highest
permissible rate. If there are no Obligations outstanding, the Banks shall
refund to Borrowers such excess.
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2.14. JOINT AND SEVERAL LIABILITY; PARENT AS AGENT.
(a) The obligations and liabilities of Borrowers under,
and all representations, warranties and covenants of Borrowers in, this
Agreement and the Loan Documents shall be joint and several in all respects
whatsoever, regardless of which Borrower actually receives loans or other
extensions of credit hereunder or the amount of such loans received or the
manner in which Agent accounts for such loans or other extensions of credit on
its books and records. Each Borrower's Obligations with respect to Loans made
to it or accommodations issued for its account, and related fees, costs and
expenses, and each Borrower's Obligations arising as a result of the joint and
several liability of the Borrowers hereunder, with respect to Loans made to
the other Borrower hereunder or accommodations issued for the account of the
other Borrower hereunder, together with the related fees, costs and expenses,
and each Borrower's obligations otherwise arising under this Agreement, shall
be separate and distinct obligations, all of which are primary obligations of
each Borrower. Whenever the term "Borrower" or "Borrowers" is used in this
Agreement or the Loan Documents it shall mean each individual Borrower and all
Borrowers jointly and severally, unless the context clearly and specifically
requires otherwise.
(b) Each Borrower's Obligations arising as the result of
the joint and several liability of the Borrowers hereunder with respect to
loans or other extensions of credit made to the other Borrowers hereunder
shall, to the fullest extent permitted by law, be unconditional irrespective
of (i) the validity or enforceability, avoidance or subordination of the
Obligations of the other Borrowers or of any promissory note or other document
evidencing all or any part of the Obligations of the Borrowers, (ii) the
absence of any attempt to collect the Obligations from the other Borrowers,
any other guarantor, or any other security therefor, or the absence of any
other action to enforce the same, (iii) the waiver, consent, extension,
forbearance or granting of any indulgence by the Agent or any Bank with
respect to any provision of any instrument evidencing the Obligations of the
other Borrowers, or any part thereof, or any other agreement now or hereafter
executed by the other Borrowers and delivered to the Agent, (iv) the failure
of Agent to take any steps to perfect and maintain its security interest in,
or to preserve its rights to, any security or collateral for the Obligations
of the other Borrowers, (v) the Agent's election, in any proceeding instituted
under the Bankruptcy Code, of the application of Section 1111(b)(2) of the
Bankruptcy Code, (vi) any borrowing or a grant of a security interest by the
other Borrowers, as debtor-in-possession under Section 364 of the Bankruptcy
Code, or (viii) any other circumstance which might constitute a legal or
equitable discharge or defense of a guarantor or of the other Borrowers.
(c) Agent and Banks may deal with each Borrower as if it
were the sole obligor, without impairing in any way the liability of any other
Borrower. Without limiting the generality of that right, Banks may in
particular release, impair, or fail to perfect an interest in any Collateral
of any Borrower, waive defaults by any Borrower, or extend, compromise or
release the liability of any Borrower, without the consent of any other
Borrower.
(d) Borrowers represent that they have carefully
considered the alternatives to and the legal consequences of incurring joint
and several liability for the Obligations
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and have determined that by such arrangement they are able to obtain financing
on terms more favorable than otherwise, and that under a joint and several
loan facility they will each realize substantial interest savings over
alternative financing arrangements.
(e) All Borrowers hereby irrevocably appoint The O'Gara
Company ("Parent") as their agent representative to deal with Agent and the
Banks on their behalf in all respects in connection with this Agreement and
the transactions contemplated herein, including the submission of requests for
Revolving Loans. All Borrowers agree to be bound by all actions of Parent in
all such respects.
(f) Agent (on behalf of the Banks) may bring a separate
action or actions on the Obligations against each, any, or all of the
Borrowers, whether action is brought against any other or all of such
Borrowers, or any one or more of the Borrowers is or is not joined therein.
Each Borrower agrees that any release which may be given to any one or more of
the Borrowers or any guarantor of the Obligations shall not release any other
Borrower from its obligations hereunder. Each Borrower hereby waives any right
to assert against Agent or any Bank any defense (legal or equitable), set off,
counterclaim, or claims which such Borrower individually may now or any time
hereafter have against another Borrower or any other party liable to Agent or
any Bank in any manner whatsoever. Each Borrower consents and agrees that
Agent or any Bank shall not be under any obligation to xxxxxxxx any assets in
favor of such Borrower or against or in payment of any of or all of the
Obligations.
(g) Any and all present and future debt and other
obligations of any Borrower to any other Borrower are hereby subordinated to
the full payment and performance of the Obligations; provided, however, such
debt and other obligations may be incurred and repaid, subject to the terms of
this Agreement, so long as no Default or Event of Default shall have occurred
and not have been waived.
(h) Each Borrower is presently informed as to the
financial condition of each of the other Borrowers and of all other
circumstances which a diligent inquiry would reveal and which bear upon the
risk of nonpayment of the Obligations. Each Borrower hereby covenants that it
will continue to keep itself informed as to the financial condition of all
other Borrowers, the status of all other Borrowers, and of all circumstances
which bear upon the risk of nonpayment. Absent a written request from any of
the Borrowers to Agent for information, each Borrower hereby waives any and
all rights it may have to require Agent or Banks to disclose to such Borrower
any information which Agent or Banks may now or hereafter acquire concerning
the condition or circumstances of any of the Borrowers.
(i) Except to the extent that the Parent is entitled to
notices on behalf of Borrowers, each Borrower waives all rights to notices of
default, existence, creation, or incurring of new or additional indebtedness,
and all other notices of formalities to which such Borrower may, as a joint
and several Borrower hereunder, be entitled.
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2.15. DEFAULTING BANK. In the event that, at any time, any
Bank shall be a Defaulting Bank, (a) a Defaulted Amount owed to Agent, Issuing
Bank or another Bank shall bear interest at an annual rate equal to the
Federal Funds Rate for the first three Business Days such Defaulted Amount is
owing, and thereafter at a rate of 3% above the Federal Funds Rate, and (b)
Agent may apply all monies that would otherwise be payable to the Defaulting
Bank under the Loan Documents instead to the payment of any Defaulted Amounts
owed to the following Persons, in the following order of priority: first to
Agent, then to Issuing Bank, then to the other Banks, then to Borrowers. In
addition, a Person owed a Defaulted Amount may exercise all available remedies
to collect such Defaulted Amount from the Defaulting Bank.
Section 3. REPRESENTATIONS AND WARRANTIES.
Each Borrower hereby warrants and represents to Agent and
Banks the following:
3.1. ORGANIZATION AND QUALIFICATION. Each Borrower is a duly
organized, validly existing corporation in good standing under the laws of the
state or jurisdiction of incorporation, has the power and authority (corporate
and otherwise) to carry on its business and to enter into and perform this
Agreement, the Notes and the other Loan Documents and is qualified and
licensed to do business in each jurisdiction in which a failure to so qualify
would have a material adverse effect on its financial condition. All
information set forth in the Specific Representations Exhibit to the Security
Agreement of each Borrower is true and correct as of the date of this
Agreement.
3.2. DUE AUTHORIZATION. The execution, delivery and
performance by each Borrower of this Agreement, its Security Agreement, the
Notes and the other Loan Documents have been duly authorized by all necessary
corporate action, and will not contravene any law or any governmental rule or
order binding on such Borrower, or the Articles of Incorporation or Code of
Regulations of such Borrower, nor violate any agreement or instrument by which
a Borrower is bound nor result in the creation of a Lien on any assets of a
Borrower except the Lien granted to Agent herein. Each Borrower has duly
executed and delivered this Agreement, its Security Agreement, the Notes and
the other Loan Documents and they are valid and binding obligations of such
Borrower enforceable according to their respective terms except as limited by
equitable principles and by bankruptcy, insolvency or similar laws affecting
the rights of creditors generally. No notice to or consent by any governmental
body is needed in connection with this transaction, except for appropriate
filing of the Security Documents.
3.3. LITIGATION. Except as set forth on Exhibit 3.3 or as
materially covered by insurance, there are no suits or proceedings currently
pending or threatened against a Borrower, and no proceedings before any
governmental body is currently pending or threatened against any Borrower.
3.4. MARGIN STOCK. No part of the Loans will be used to
purchase or carry, or to reduce or retire or refinance any credit incurred to
purchase or carry, any margin stock (within the meaning of Regulations U and X
of the Board of Governors of the Federal Reserve System) or to
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extend credit to others for the purpose of purchasing or carrying any margin
stock. If requested by Agent, Borrowers will furnish to Agent statements in
conformity with the requirements of Federal Reserve Form U-1.
3.5. BUSINESS. No Borrower is a party to or subject to any
agreement or restriction which in the opinion of such Borrower's management is
so unusual or burdensome that it might have a material adverse effect on such
Borrower's business or properties.
3.6. LICENSES, ETC. Each Borrower has obtained any and all
licenses, permits, franchises, governmental authorizations, patents,
trademarks, copyrights or other rights necessary for the ownership of its
properties and the advantageous conduct of its business. Each Borrower
possesses adequate licenses, patents, patent applications, copyrights,
trademarks, trademark applications, and trade names to continue to conduct its
business as previously conducted by it, without any conflict with the rights
of any other person or entity. All of the foregoing are in full force and
effect and none of the foregoing are in known conflict with the rights of
others, except with respect to certain litigation disclosed on attached
Exhibit 3.3.
3.7. LAWS AND TAXES. Each Borrower is in material compliance
with all laws, regulations, rulings, orders, injunctions, decrees, conditions
or other requirements applicable to or imposed upon such Borrower by any law
or by any governmental authority, court or agency. Excluding items being
diligently contested in good faith and from which a Borrower has established
adequate reserves or other appropriate provisions as required by generally
accepted accounting principles, each Borrower has filed all required tax
returns and reports that are now required to be filed by it in connection with
any federal, state and local tax, duty or charge levied, assessed or imposed
upon such Borrower or its assets, including unemployment, social security, and
real estate taxes. Each Borrower has paid all taxes which are now due and
payable. No taxing authority has asserted or assessed any additional tax
liabilities against any Borrower which are outstanding on the date of this
Agreement, and no Borrower has filed for any extension of time for the payment
of any tax or the filing of any tax return or report.
3.8. FINANCIAL CONDITION. All historical financial
information relating to Borrowers which has been or may hereafter be delivered
by Borrowers on their behalf to Agent is true and correct in all material
respects and has been prepared in accordance with generally accepted
accounting principles consistently applied (excluding, however, interim
financial statements which are not prepared in accordance with generally
accepted accounting principles). Borrowers have no material obligations or
liabilities of any kind not disclosed in that financial information which
should be so disclosed in accordance with generally accepted accounting
principles, and there has been no material adverse change in the financial
condition of Borrowers nor have Borrowers suffered any damage, destruction or
loss which has materially adversely affected its business or assets since the
submission of the most recent financial information to Agent.
3.9. TITLE. Each Borrower has good and marketable title to
the assets reflected on the most recent balance sheet submitted to Agent, free
and clear from all liens and encumbrances of
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any kind, except for (collectively, the "Permitted Liens"): (a) taxes and
assessments not yet due and payable, (b) liens and encumbrances, if any,
reflected or noted on such balance sheet or notes thereto, (c) assets
(including inventory and obsolete or worn-out equipment) disposed of in the
ordinary course of business, (d) any security interests, pledges, assignments
or mortgages granted to Agent or Banks to secure the repayment or performance
of the Obligations, (e) easements and other restrictions of record which do
not materially and adversely impact the use of a Borrower's property, (f)
capital leases in an amount not to exceed $500,000 at any time, (g) liens
securing purchase money security interests in an amount not to exceed $300,000
at any time so long as such liens only secure the asset being financed by such
purchase money financing, and (h) items set forth on attached Exhibit 3.9.
3.10. DEFAULTS. Each Borrower is in material compliance with
all material agreements applicable to it and there does not now exist any
default or material violation by such Borrower of or under any of the terms,
conditions or obligations of (a) its Articles of Incorporation,
Regulations/Bylaws or other applicable governing instruments, or (b) any
indenture, mortgage, deed of trust, franchise, permit, contract, agreement or
other instrument to which a Borrower is a party or by which it is bound, and
the consummation of the transactions contemplated by this Agreement will not
result in such default or violation.
3.11. ENVIRONMENTAL LAWS.
(a) Each Borrower has obtained all material permits,
licenses and other authorizations or approvals which are required under
Environmental Laws and each Borrower is in compliance in all material respects
with all terms and conditions of the required permits, licenses,
authorizations and approvals, and is also in compliance in all material
respects with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
the Environmental Laws.
(b) Borrowers are not aware of, and have not received
notice of, any past, present or future events, conditions, circumstances,
activities, practices, incidents, actions or plans which may interfere with or
prevent compliance or continued compliance, in any material respect, with
Environmental Laws, or may give rise to any material common law or legal
liability, or otherwise form the basis of any material claim, action, demand,
suit, proceeding, hearing, study or investigation, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling or the emission, discharge, release or threatened
release into the environment, of any pollutant, contaminant, chemical, or
industrial, toxic or hazardous substance or waste.
(c) There is no civil, criminal or administrative
action, suit, demand, claim, hearing, notice or demand letter, notice of
violation, investigation or proceeding pending or threatened against any
Borrower, relating in any way to Environmental Laws.
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3.12. SUBSIDIARIES AND PARTNERSHIPS. As of the date of this
Agreement, no Borrower has any subsidiaries or is a party to any partnership
agreement or joint venture agreement other than those set forth on Exhibit
3.12 attached to this Agreement (as such Exhibit may be updated by Borrowers
from time to time).
3.13. ERISA. Borrowers and all individuals or entities which
along with Borrowers would be treated as a single employer under ERISA or the
Internal Revenue Code of 1986, as amended (an "ERISA Affiliate"), are in
compliance with all of their obligations to contribute to any "employee
benefit plan" as that term is defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, and any regulations promulgated
thereunder from time to time ("ERISA"). Borrowers and each of their ERISA
Affiliates are in compliance in all material respects with ERISA, and there
exists no event described in Section 4043(b) thereof ("Reportable Event").
3.14. SOLVENCY. Each Borrower individually is, and Borrowers
taken as a whole are, Solvent and upon consummation of the transactions
contemplated by this Agreement will be Solvent. "Solvent" means that: (a) the
present fair salable value of a person's assets (including its right of
contribution arising pursuant to the Contribution Agreement or otherwise at
law) is in excess of the total amount of its liabilities (including contingent
liabilities); (b) a person does not have unreasonably small capital and is
able to pay its debts as they become due; and (c) a person does not intend to
or believe it will incur obligations beyond its ability to pay as they mature.
Section 4. AFFIRMATIVE COVENANTS.
4.1. BOOKS AND RECORDS. Borrowers will maintain proper books
of account and records and enter therein complete and accurate entries and
records of all of their transactions in accordance with generally accepted
accounting principles and give representatives of Agent access thereto at all
reasonable times upon reasonable prior notice, including permission to
examine, copy and make abstracts from any such books and records and such
other information which might be helpful to Agent in evaluating the status of
the Loans as it may reasonably request from time to time. Borrowers will give
Agent reasonable access to the Collateral and the other property securing the
Obligations for the purpose of performing examinations thereof and to verify
its condition or existence. Agent may conduct an internal audit of all books
and records of Borrowers up to two times per year, at its discretion.
4.2. FINANCIAL STATEMENTS. Borrowers will maintain a
standard and sufficient system for accounting and will furnish to Agent (who
shall be obligated hereby to distribute the same promptly to Banks):
(a) Within twenty (20) days after the end of each month
(excluding December), a copy of Parent's consolidated financial statements for
that month and for the year to date in a form reasonably acceptable to Agent,
prepared and certified as complete and correct in all material respects,
subject to changes resulting from year-end adjustments, by the principal
financial officer of Parent;
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(b) Within forty-five (45) days after the end of each
quarter, a copy of Parent's consolidated financial statements for that quarter
reviewed by a firm of independent certified public accountants acceptable to
Agent (which acceptance will not be unreasonably withheld), and accompanied by
a standard letter of review for the year to date in a form reasonably
acceptable to Agent, prepared and certified as complete and correct in all
material respects, subject to changes resulting from year-end adjustments, by
the principal financial officer of Parent and also a Compliance Certificate
which sets forth the computation of the financial status of Parent (on a
consolidated basis) with respect to the financial covenants contained in
Sections 5.8 through 5.14 of this Agreement;
(c) Within ninety (90) days after the end of each fiscal
year, a copy of Borrowers' consolidated financial statements for that year
audited by a firm of independent certified public accountants acceptable to
Agent (which acceptance will not be unreasonably withheld), and accompanied by
a standard audit opinion of such accountants without qualification; and within
120 days after the end of each fiscal year, a management letter of such
accountants in connection with such audit;
(d) With the statements submitted under (a), (b) and (c)
above, a certificate signed by the principal financial officer of Parent, (i)
stating he is familiar with all documents relating to Borrowers' borrowing
relationship with Banks and that no Event of Default specified in this
Agreement, nor any event which upon notice or lapse of time, or both would
constitute such an Event of Default, has occurred, or if any such condition or
event existed or exists, specifying it and describing what action Borrowers
have taken or propose to take with respect thereto, and (ii) setting forth, in
summary form, figures showing the financial status of Borrowers in respect of
the financial covenants contained in Sections 5.8 through 5.14 of this
Agreement;
(e) With the financial statements submitted under clause
(b) above, an agreed upon procedures letter from such accountants with respect
to the following accounts: (i) Cost and Estimated Earnings in Excess of
Xxxxxxxx on Uncompleted Contracts; (ii) Customer Deposits/Progress Payments;
(iii) Work-in-Progress; and (iv) Inventory/Stock. This agreed upon procedures
letter shall detail the following procedures performed with respect to such
accounts:
(i) Obtain detailed supporting schedules for such
accounts;
(ii) Agree the reconciliation of such accounts to the
general ledger and the detailed supporting schedules as of quarter-end: foot
the reconciliation and inquire of the Borrowers' management regarding any
reconciling items and their applicability to the income statement;
(iii) Trace the general ledger account balances to the
work papers used for the quarterly financial statement presentation (i.e.
ensure that general ledger balances are accurately reflected in the financial
statements); and
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(iv) Determine that the procedures followed by
Borrowers to reconcile such accounts on a monthly basis are consistent with
those utilized quarterly.
(f) Within twenty (20) days after the end of each month, a
work-in-process report, receivables aging report and Collateral Report in form
and substance acceptable to Agent;
(g) Prior to the end of each fiscal year, a projected
balance sheet, projected income statement and projected statement of cash flow
for the subsequent fiscal year in detail reasonably acceptable to Agent
(h) Immediately upon any officer of a Borrower obtaining
knowledge of any condition or event which constitutes or, after notice or
lapse of time or both, constitutes an Event of Default, a certificate of such
person specifying the nature and period of the existence thereof, and what
action Borrowers have taken or are taking or propose to take in respect
thereof; and
(i) Upon request, copies of all federal, state and local
income tax returns and such other information as Agent may reasonably request.
If at any time a Borrower has any additional subsidiaries which have financial
statements that could be consolidated with those of such Borrower under
generally accepted accounting principles, the financial statements required by
subsections (a) and (b) above will be the financial statements of Borrowers
and all such subsidiaries prepared on a consolidating (with respect to each of
the three categories of business) and consolidated basis.
4.3. CONDITION AND REPAIR. Each Borrower will maintain its
assets in good repair and working order (ordinary wear and tear excepted) and
will make all appropriate repairs and replacements thereof.
4.4. INSURANCE. Each Borrower will insure its properties and
business against loss or damage of the kinds and in the amounts customarily
insured against by corporations with established reputations engaged in the
same or similar business as a Borrower. All such policies will (a) be issued
by financially sound and reputable insurers, (b) name Agent as an additional
insured and, where applicable, as loss payee under a lender loss payable
endorsement satisfactory to Agent, and (c) will provide for thirty (30) days
written notice to Agent before such policy is altered or canceled, all of
which will be evidenced by a Certificate of Insurance delivered to Agent by
Borrowers on the date of execution of this Agreement.
4.5. TAXES. Each Borrower will pay when due all taxes, assessments
and other governmental charges imposed upon it or its assets, franchises,
business, income or profits before any penalty or interest accrues thereon,
and all claims (including, without limitation, claims for labor, services,
materials and supplies) for sums which by law might be a lien or charge upon
any
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of its assets, provided that (unless any material item or property would be
lost, forfeited or materially damaged as a result thereof) no such charge or
claim need be paid if it is being diligently contested in good faith, if Agent
is notified in advance of such contest and if an adequate reserve is
established or other appropriate provision required by generally accepted
accounting principles.
4.6. EXISTENCE; BUSINESS. Each Borrower will (a) maintain
its existence, (b) engage primarily in the three general categories of
business (being security hardware, security services and security integration
services), and (c) refrain from entering into any lines of business
substantially different from such three categories of business or activities
in which Borrowers are presently engaged.
4.7. COMPLIANCE WITH LAWS. Each Borrower will comply with
all federal, state and local laws, regulations and orders applicable to such
Borrower or its assets including but not limited to all Environmental Laws, in
all respects material to a Borrower's business, assets or prospects and will
immediately notify Agent of any material violation of any rule, regulation,
statute, ordinance, order or law relating to the public health or the
environment and of any complaint or notifications received by a Borrower
regarding to any environmental or safety and health rule, regulation, statute,
ordinance or law.
4.8. NOTICE OF DEFAULT. Each Borrower will, within three (3)
days of its knowledge thereof, give written notice to Agent of: (a) the
occurrence of any event or the existence of any condition which would be,
after notice or lapse of applicable grace periods, an Event of Default, and
(b) the occurrence of any event or the existence of any condition which would
prohibit a Borrower from continuing to make the representations set forth in
this Agreement.
4.9. COSTS. Borrowers will pay to Agent and each Bank its
respective fees, costs and expenses (including, without limitation, reasonable
attorneys' fees, other professionals' fees), expert fees, court costs,
litigation and other expense (collectively, "Costs") incurred or paid by them
in connection with the negotiating, documenting, administering and enforcing
the Loans and the Loan Documents and the defense, preservation and protection
of Agent and Banks' rights and remedies thereunder, including without
limitation, its security interest in the Collateral or any other property
pledged to secure the Loans, whether incurred in bankruptcy, insolvency,
foreclosure or other litigation or proceedings or otherwise. The Costs will be
due and payable upon demand by Agent or a Bank. If Borrowers fail to pay the
Costs when upon such demand, Banks are entitled to disburse such sums as an
advance under the Revolving Credit Facility. Thereafter, the Costs will bear
interest from the date incurred or disbursed at the highest rate set forth in
the Revolving Note. This provision will survive the termination of this
Agreement and/or the repayment of any amounts due or the performance of any
Obligation.
4.10. DEPOSITORY/BANKING SERVICES. So long as this Agreement
is in effect, Fifth Third will be the principal depository in which
substantially all of Borrowers' funds are deposited, and the principal bank of
account of Borrowers. Borrowers will also maintain a non-interest bearing
account with Fifth Third at all times during the term of this Agreement with a
collected balance of
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at least $250,000 deposited therein. Borrowers will grant Fifth Third the
first and last opportunity to provide any corporate banking services required
by Borrowers, including, without limitation, payroll, cash management and
employee benefit plan services. Notwithstanding the foregoing, Banks consent
to Irish and Subsidiaries of a Borrower domiciled outside of the United States
establishing and maintaining bank accounts with banks in their respective
country.
4.11. OTHER AMOUNTS DEEMED LOANS. If a Borrower fails to pay
any tax, assessment, governmental charge or levy or to maintain insurance
within the time permitted or required by this Agreement, or to discharge any
Lien prohibited hereby, or to comply with any other Obligation, a Bank may,
but shall not be obligated to, pay, satisfy, discharge or bond the same for
the account of such Borrower, and to the extent permitted by law and at the
option of such Bank, all monies so paid by a Bank on such behalf of such
Borrower will be deemed Loans and Obligations.
4.12. FRENCH DOCUMENTS. Borrowers shall cause the
appropriate parties to execute and deliver share pledges, guarantees (to the
extent permitted by French law) and other security over assets from the
following: (a) shareholders of O'Gara France, S.A.; (b) O'Gara France, S.A.;
and (c) Xxxxx. Any documents required by Agent not delivered on the date
hereof shall be executed and delivered within twenty (20) days of the date of
this Agreement.
4.13. NEXT DESTINATION. Borrowers shall cause the delivery
to Agent of a share pledge of the shares of Next Destination Limited in form
and substance reasonably acceptable to Agent. Borrowers shall not permit Next
Destination Limited to encumber its assets without the prior consent of Agent.
4.14. LIFE INSURANCE. Borrowers shall deliver to Agent the
Life Insurance Policy and an acknowledged Collateral Assignment of such Life
Insurance Policy within sixty (60) days of the date of this Agreement, as
contemplated by the Security Agreement from Parent.
Section 5. NEGATIVE COVENANTS.
5.1. PREPAYMENTS. So long as no Event of Default is
continuing or will occur as a result of such prepayment, Borrowers will not
voluntarily prepay any Indebtedness prior to the stated maturity date thereof
other than (i) the Obligations and (ii) Indebtedness to trade creditors where
the prepayment will result in either a discount on the amount due or delivery
of shipments of goods from suppliers that maintain credit limits with respect
to receivables from a Borrower.
5.2. PLEDGE OR ENCUMBRANCE OF ASSETS. Other than the
Permitted Liens, Borrowers will not create, incur, assume or permit to exist,
arise or attach any Lien in any present or future asset, except for Liens to
Agent or Banks, Liens arising with respect to government progress xxxxxxxx,
Liens existing on the date of this Agreement which have been disclosed to and
approved by Banks and Liens imposed by law which secure amounts not at the
time due and payable.
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5.3. GUARANTEES AND LOANS. Borrowers will not enter into any
direct or indirect guarantees other than by endorsement of checks for deposit
or other than in the ordinary course of business nor make any advance or loan
other than in the ordinary course of business as presently conducted,
including, without limitation, loans and advances to employees of a Borrower
(except in connection with reimbursable business or travel expenses), but
excluding, however, the following: (a) guaranties of obligations of
Subsidiaries; (b) loans and other advances to Subsidiaries; (c) loans in
connection with acquisitions permitted under this Agreement; and (d) advances
to vendors in the ordinary course of business.
5.4. MERGER; DISPOSITION OF ASSETS. No Borrower will (a)
change its capital structure, (b) merge or consolidate with any corporation,
(c) amend or change its Articles of Incorporation or Code of Regulations or
(d) sell, transfer or otherwise dispose of all or any substantial part of its
assets, whether now owned or hereafter acquired.
5.5. TRANSACTIONS WITH AFFILIATES. Except as otherwise
permitted by this Agreement or as fully disclosed in Parent's S-1 Filing with
the Securities and Exchange Commission, no Borrower will (a) directly or
indirectly issue any guarantee for the benefit of any of its Affiliates, other
than transactions entered into on an arm's length basis in the normal course
of a Borrower's business, (b) directly or indirectly make any loans or
advances to or investments in any of its Affiliates, other than transactions
entered into on an arm's length basis in the normal course of a Borrower's
business, (c) enter into any transaction with any of its Affiliates, other
than transactions entered into on an arm's length basis in the normal course
of a Borrower's business, or (d) divert (or permit anyone to divert) any of
its business opportunities to any Affiliate or any other corporate or business
entity in which a Borrower or its shareholders holds a direct or indirect
interest.
5.6. INVESTMENTS. Borrowers will not purchase or hold
beneficially any stock, securities or evidences of indebtedness of, or make
any investment or acquire any interest in, any other firm, partnership,
corporation or entity other than (a) short term investments of excess working
capital in (i) direct or guaranteed obligations of the United States, or any
agencies thereof, or (ii) investments (of one year or less) in certificates of
deposit of banks or trust companies organized under the laws of the United
States or any jurisdiction thereof, provided that such banks or trust
companies are insured by the Federal Deposit Insurance Corporation and have
capital in excess of $25,000,000; (b) stock of Subsidiaries; (c) trade credit
in the ordinary course of business; (d) the Xxxxx Transaction and (e) the
acquisition of International Training, Inc.
5.7. FOREIGN INVESTMENTS. Borrowers will not make loans,
advances or cash investments in any foreign entity or entities, in an
aggregate amount in excess of $17,000,000 at any time.
5.8. INDEBTEDNESS TO TANGIBLE NET WORTH (the "Leverage
Ratio"). Parent (on a consolidated basis) will not permit its ratio of
outstanding Indebtedness to Tangible Net Worth, on a consolidated basis during
the following time periods, to exceed the following:
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PERIOD ENDING MAXIMUM RATIO
12/31/97 - 06/29/98 5.50 : 1.00
06/30/98 - 12/30/98 5.00 : 1.00
12/31/98 - 06/29/99 3.00 : 1.00
06/30/99 - Thereafter 2.25 : 1.00
5.9. TANGIBLE NET WORTH. Parent (on a consolidated basis)
will not permit its Tangible Net Worth, on a consolidated basis, at any time
during the following time periods to be less than the following:
PERIOD ENDING REQUIREMENT
Closing through 03/30/97 $ 3,500,000
03/31/97 - 06/29/97 $ 5,000,000
06/30/97 - 12/30/97 $ 6,500,000
12/31/97 - 06/29/98 $10,500,000
06/30/98 - 12/30/98 $15,000,000
12/31/98 - 06/29/99 $19,000,000
06/30/99 - Thereafter $25,000,000
5.10. DEBT SERVICE COVERAGE RATIO. As of the end of each
fiscal quarter, Parent (on a consolidated basis) will not permit its Debt
Service Coverage Ratio, on a consolidated basis, to be less than 1.30: 1.00 so
long as any of the Obligations remain outstanding.
5.11. CURRENT RATIO. Parent (on a consolidated basis) will
not permit its Current Ratio, on a consolidated basis, to be less than 1.10:1.00
so long as any of the Obligations remain outstanding.
5.12. CASH FLOW COVERAGE. Parent (on a consolidated basis)
will not permit its consolidated ratio of Funded Debt to Cash Flow (on a
consolidated basis on a 4-quarter rolling basis) to be more than (a) 2.50 : 1.00
from the date of this Agreement through December 30, 1997 and (b) 2.0 : 1.0 from
December 31, 1997 and thereafter.
5.13. INDEBTEDNESS. Borrowers will not incur, create, assume
or permit to exist Indebtedness in excess of $60,000,000 at any time during
the term of this Agreement (excluding therefrom inter-company loans between
Borrowers).
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5.14. CAPITAL EXPENDITURES. Borrowers will not make any
capital expenditures (including capitalized leases), or any commitment
therefor, in any fiscal year in excess of $1,500,000.
5.15. DIVIDENDS. Parent will not declare or pay any dividend
or distributions (except stock dividends) on its capital stock, or redeem any
shares of its capital stock without the prior written approval of Agent.
5.16. INTEREST RATE PROTECTION. Borrowers will obtain by
July 1, 1997 and maintain interest rate protection/hedging arrangements from
an Interest Rate Provider for a minimum of 75% of the outstanding principal
balance of the Term Loan. Such arrangements shall be subject to the review and
approval of Required Banks.
Section 6. EVENTS OF DEFAULT AND REMEDIES.
6.1. EVENTS OF DEFAULT. Any of the following events will be
an Event of Default ("Event of Default"):
(a) any representation or warranty made by any Borrower
herein or in any of the Loan Documents is incorrect in any material respect when
made or reaffirmed; or
(b) A Borrower defaults in the payment of any
principal or interest on any Obligation within ten (10) days of when due and
payable, by acceleration or otherwise; or
(c) A Borrower defaults under the following provisions:
4.10; 5.1; 5.6; 5.7; 5.8; 5.9; 5.10, 5.11, 5.12, 5.13, 5.14 and 5.15; or
(d) A Borrower fails to observe or perform any covenant,
condition or agreement herein and fails to cure such default within thirty (30)
days after written notice thereof from Agent, provided that such thirty (30) day
grace period will not apply to (i) a breach of any covenant which in Required
Bank's good faith judgment is incapable of cure, (ii) any failure to maintain
insurance or permit inspection of the Collateral or of the books and records of
a Borrower, (iii) any breach of any provisions specified in Sections 6.1(a), (b)
or (c), or (iv) any breach of any covenant which has occurred prior to the date
of this Agreement; or
(e) a court enters a decree or order for relief with
respect to any Borrower in an involuntary case under any applicable
bankruptcy, insolvency or other similar law then in effect, or appoints a
receiver, liquidator, assignee, custodian, trustee, sequestrator (or other
similar official) of a Borrower or for any substantial part of its property,
or orders the wind-up or liquidation of its affairs; or a petition initiating
an involuntary case under any such bankruptcy, insolvency or similar law is
filed and is pending for forty-five (45) days without dismissal; or
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(f) A Borrower commences a voluntary case under any
applicable bankruptcy, insolvency or other similar law in effect, or makes
any general assignment for the benefit of creditors, or fails generally to
pay its debts as such debts become due;
(g) A Borrower defaults under the terms of any
Indebtedness or lease involving total payment obligations of such Borrower in
excess of $500,000, and such default gives any creditor or lessor the right
to accelerate the maturity of any such indebtedness or lease payments which
right is not contested by such Borrower or is determined by any court of
competent jurisdiction to be valid and such Borrower fails to pay such
obligation within thirty (30) days; or
(h) final judgment of the payment of money in excess of
$500,000 is rendered against a Borrower and remains undischarged for 10 days
during which execution is not effectively stayed; or
(i) any event occurs which has a material adverse effect
on the Collateral or on a Borrower's financial condition, operations or
assets, or on any other property securing the repayment of the Obligations;
or
(j) a material change occurs in the collective management
of Parent; or
(k) an Event of Default occurs under any Loan Document;
or
(l) the dissolution of Parent; or
(m) the commencement of any foreclosure proceedings,
proceedings in aid of execution, attachment actions, levies against, or the
filing by any taxing authority of a lien against any material part of the
Collateral or any material part of the property securing the repayment of
any of the Obligations; or
(n) the loss, theft or substantial damage to the
Collateral or any property securing the repayment of the Obligations if the
result of such occurrence will be, in Agent's reasonable judgment, the
failure or inability of a Borrower to continue substantially normal
operation of its business within thirty (30) days of the date of such
occurrence, unless the same is covered by business interruption insurance;
(o) Fifth Third ceases to be Parent or Armoring's (i)
principal depository bank where its funds are deposited, and (ii) principal
bank of account.
(p) (i) the validity or effectiveness of any of the Loan
Documents or its transfer, grant, pledge, mortgage, or assignment by the
party executing such Loan Document is impaired; (ii) any party executing any
of the Loan Documents asserts that any of such Loan Documents is not a
legal, valid and binding obligation of the party thereto enforceable in
accordance with its terms, except to the extent that enforcement thereof may
be limited by equitable principles
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or by bankruptcy, insolvency or other similar laws affecting the rights of
creditors generally; (iii) the security interest or Lien purporting to be
created by any of the Loan Documents will for any reason cease to be a valid,
perfected lien subject to no other liens other than Liens permitted by the
terms of this Agreement; or (iv) any Loan Document is amended, hypothecated,
subordinated, terminated or discharged, or if any person is released from any
of its covenants or obligations under any of the Loan Documents except as
permitted by Agent in writing; or
(q) Agent in good faith reasonably believes after due
inquiry that the ability of the Borrowers to make their payments or perform
their obligations hereunder or under any of the Loan Documents has been
materially and adversely impaired;
(r) a Reportable Event (as defined in ERISA) occurs
with respect to any employee benefit plan maintained by a Borrower for its
employees other than a Reportable Event caused solely by a decrease in
employment or other event that would not have a material adverse effect on
such employee benefit plan; or a trustee is appointed by a United States
District Court to administer any employee benefit plan; or the Pension Benefit
Guaranty Corporation institutes proceedings to terminate any of a Borrower's
employee benefit plans; or
(s) the filing of any lien or charge against the
Collateral or any part thereof which is not permitted by this Agreement and
is not removed to the satisfaction of Agent within a period of 30 days
thereafter; or
(t) the abandonment by a Borrower of all or any part
of the Collateral, except for sales of inventory in the ordinary course of
business or dispositions of obsolete or worn- out equipment.
6.2. REMEDIES. If any Event of Default occurs, Banks may
cease advancing money hereunder and Agent may (i) declare all Obligations to
be immediately due and payable, whereupon such Obligations will immediately
become due and payable, (ii) exercise any and all rights and remedies provided
by applicable law and the Loan Documents, (iii) proceed to realize upon the
Collateral or any property securing the Obligations, including, without
limitation, causing all or any part of the Collateral to be transferred or
registered in its name or in the name of any other person, firm or
corporation, with or without designation of the capacity of such nominee, all
without presentment, demand, protest, or notice of any kind, each of which are
hereby expressly waived by Borrowers. Each Borrower shall be liable for any
deficiency remaining after disposition of any Collateral, and waives all
valuation and appraisement laws.
6.3. SETOFF. If any Event of Default occurs, each Bank is
authorized, without notice to Borrowers, to offset and apply to all or any
part of the Obligations all moneys, credits and other property of any nature
whatsoever of Borrowers now or at any time hereafter in the possession of, in
transit to or from, under the control or custody of, or on deposit with
(whether held by any Borrower individually or jointly with another party), a
Bank, including but not limited to certificates of deposit.
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6.4. DEFAULT RATE. After the occurrence of an Event of
Default, all amounts of principal outstanding as of the date of the occurrence
of such Event of Default will accrue interest at the Default Rate, in Agent's
sole discretion, without notice to Borrowers. This provision does not
constitute a waiver of any Events of Default or an agreement by Agent (for the
pro-rata benefit of Banks) to permit any late payments whatsoever.
6.5. LATE PAYMENT PENALTY. If any payment of principal is
not paid when due (whether at maturity, by acceleration or otherwise after the
expiration of any applicable notice, grace and cure periods), Borrowers agree
to pay to Agent (for the pro-rata benefit of Banks) a late payment fee equal
to five percent (5%) of the payment amount then due.
6.6. NO REMEDY EXCLUSIVE. No remedy set forth herein is
exclusive of any other available remedy or remedies, but each is cumulative
and in addition to every other remedy available under this Agreement, the Loan
Documents or as may be now or hereafter existing at law, in equity or by
statute. Each Borrower waives any requirement of marshaling of assets which
may be secured by any of the Loan Documents.
6.7. EFFECT OF TERMINATION. The termination of this
Agreement will not affect any rights of any party or any obligation of any
party to the other, arising prior to the effective date of such termination,
and the provisions hereof shall continue to be fully operative until all
transactions entered into, rights created or Obligations incurred prior to
such termination have been fully disposed of, concluded or liquidated. The
security interest, lien and rights granted to Agent and Banks hereunder and
under the Loan Documents will continue in full force and effect,
notwithstanding the termination of this Agreement or the fact that no Loans
are outstanding to Borrowers, until all of the Obligations, have been paid in
full.
Section 7. CONDITIONS PRECEDENT.
7.1. CONDITIONS TO INITIAL LOANS. Banks will have no
obligation to make or advance any Revolving Loan, the Term Loans or any
Letters of Credit until Borrowers have delivered to Agent at or before the
closing date, in form and substance satisfactory to Agent:
(a) The executed Notes.
(b) A Certificate of Borrower from each Borrower in the
form of Exhibit 7.1(b) and all attachments thereto.
(c) A favorable opinion of counsel to Borrowers,
substantially in the form of Exhibit 7.1(c) attached hereto.
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(d) An executed version of the Security Agreement from
each Borrower in the form of Exhibit 8.5 attached hereto along with a
completed version on Schedule I attached thereto entitled "Specific
Representations".
(e) All appropriate financing statements (Form UCC-1)
and consents or waivers of material landlords, as requested by Agent.
(f) UCC searches, tax lien and litigation searches,
insurance certificates, notices or other documents which Agent may require to
reflect, perfect or protect Agent's first priority lien in the Collateral and
all other property pledged to secure the Obligations and to fully consummate
this transaction.
(g) All requisite releases of liens, termination
statements and satisfactions of mortgages necessary to release all liens and
encumbrances not permitted hereunder against the Collateral and any other
property pledged to secure the Loans and all requisite waivers and
subordination agreements, in a form satisfactory to Agent, to be executed and
delivered by any Borrower's landlords and mortgagees which are necessary to
grant Agent for the Banks a first lien in the Collateral, including but not
limited to all Inventory and Equipment of Borrowers.
(h) Borrowers have paid or will pay to Agent and Banks
all out of pocket expenses incurred by them in connection with the preparation
of this Agreement and accompanying documents and the consummation of the
transactions contemplated hereby.
(i) A Certificate of Insurance as described in
Section 4.4 hereof.
(j) Banks shall have completed to their reasonable
satisfaction an audit of the books and records of Borrowers, including the
Collateral. It is understood, however, that any such audit by Banks will in no
respect waive Banks' rights to pursue remedies upon an Event of Default.
(k) executed copies of all documents set forth on Agent's
document list for this transaction.
(l) Such additional information and materials as Agent
and any Bank may reasonably request.
7.2. CONDITIONS TO EACH REVOLVING LOAN. On the date of each
Revolving Loan, the following statements will be true:
(a) All of the representations and warranties contained
herein and in the Loan Documents will be correct in all material respects as
though made on such date.
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(b) No event will have occurred and be continuing, or
would result from such Revolving Loan, which constitutes an Event of Default,
or would constitute an Event of Default but for the requirement that notice
be given or lapse of time or both.
(c) The aggregate unpaid principal amount of the
Revolving Loans after giving effect to such Revolving Loan will not violate
the lending limits set forth in Section 2.1 of this Agreement.
(d) The acceptance by Borrowers of the proceeds of each
Revolving Loan will be deemed to constitute a representation and warranty by
Borrowers that the conditions in Section 7.2 of this Agreement, other than
those that have been waived in writing by the Required Banks, have been
satisfied.
Section 8. AGENT.
8.1. APPOINTMENT. Each Bank hereby irrevocably designates
and appoints The Fifth Third Bank as Agent of such Bank, and each such Bank
hereby irrevocably authorizes The Fifth Third Bank, as Agent for such Bank, to
take such actions on its behalf under the provisions of this Agreement, and to
exercise such powers and perform such duties as are expressly delegated to
Agent by the terms of this Agreement, together with such other powers as are
reasonably incidental thereto; provided, however, that Agent shall not be
required to take any action that exposes Agent to personal liability or that
is contrary to this Agreement or applicable law. Each Bank hereby authorizes,
consents to and directs Borrowers to deal with Agent as the true and lawful
agent of such Bank to the extent set forth hereunder. Notwithstanding any
provision to the contrary elsewhere in this Agreement, Agent shall not have
any duties or responsibilities, except those expressly set forth herein or
therein, or any fiduciary relationship with any Bank, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or otherwise exist against Agent.
8.2. DELEGATION OF DUTIES. Agent may execute any of its
duties under this Agreement by or through agents or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to
such duties. Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care, and
reliance upon advice of counsel in good faith shall be full justification for
any act or omission of Agent.
8.3. EXCULPATORY PROVISIONS. Neither Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates shall
be (a) liable to any of Banks or Borrowers for any action lawfully taken or
omitted to be taken by it or by any such person under or in connection with
the Loan Documents, except that Agent shall be liable for its own willful
misconduct or gross negligence, or (b) responsible in any manner to any of
Banks for any recitals, statements, representations or warranties made by
Borrowers or any officer of either, contained in the Loan Documents or in any
certificate, report, statement or other document referred to or provided for
in, or received by Agent under or in connection with, the Loan Documents or
for the value, legality,
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validity, effectiveness, genuineness, enforceability or sufficiency of the
Loan Documents or the Notes or any failure of Borrowers to perform their
obligations hereunder or thereunder. Agent shall not be under any obligation
to any Bank to ascertain or inquire as to the observance or performance of any
of the agreements contained in, or conditions of, the Loan Documents or any of
the Notes, or to inspect the properties, books or records of Borrowers or any
Subsidiary. Agent shall not be under any liability or responsibility
whatsoever, as Agent, to Borrowers or any other Person as a consequence of any
failure or delay in performance by, or breach by, any Bank of any of its
obligations under any of the Loan Documents, or as a consequence of any
determination as to the classification or qualification of the transactions
contemplated by the Loan Documents under any regulatory rules or regulations.
8.4. RELIANCE BY AGENT. Agent shall be entitled to rely, and
shall be fully protected in relying upon, any writing, resolution, notice
(whether written, oral or telephonic), consent, certificate, affidavit,
letter, cablegram, telegram, telecopy, telex or teletype message, statement,
order, other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons or in
acting upon any representation or warranty made or deemed to be made hereunder
and upon advice and statements of legal counsel (including, without
limitation, counsel to Borrowers), independent accountants and other experts
selected by Agent. Agent may deem and treat the payee of any Note as the owner
thereof for all purposes. Agent shall be fully justified in failing or
refusing to take any action under the Loan Documents unless it shall first
receive such advice or concurrence of Banks as it deems appropriate or it
shall first be indemnified to its satisfaction by Banks against any and all
liability and expense which may be incurred by it by reason of taking or
continuing to take and any such action. Agent shall in all cases be fully
protected in acting, or in refraining from acting, under the Loan Documents
and the Notes in accordance with a request of the Required Banks, and any such
request and any action taken or failure to act pursuant thereto shall be
binding upon all Banks and all future holders of the Notes.
8.5. NOTICE OF DEFAULT. Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless Agent has received written notice from a Bank or Borrowers
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default." In the event that Agent
receives such a notice, Agent shall promptly give notice thereof to Banks and
Borrowers. Agent shall take such action with respect to any such Event of
Default as shall be reasonably directed by the Required Banks; provided that,
unless and until Agent shall have received such direction, Agent, in its
capacity as such, may (but shall not be obliged to) take such action, or
refrain from taking such action, with respect to any such Event of Default.
8.6. NON-RELIANCE ON AGENT AND OTHER BANKS. Each Bank
expressly acknowledges that neither Agent, any other Bank nor any of their
respective officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representations or warranties to it and that no act by
Agent or any other Bank hereafter taken, including any review of the affairs
of Borrowers or the Subsidiaries, shall be deemed to constitute any
representation or warranty by Agent or any other
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Bank to such Bank. Each Bank represents to Agent and each other Bank that it
has, independently and without reliance upon Agent or any other Bank, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
assets, financial and other condition, creditworthiness and prospects of
Borrowers and the Subsidiaries, and made its own decision to make Loans
hereunder and enter into this Agreement or the Loan Documents. Each Bank also
represents that it will, independently and without reliance upon Agent or any
other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit analyses, appraisals
and decisions in taking or not taking action under this Agreement, and make
such investigation as it deems necessary inform itself as to the business,
operations, property, assets, financial and other condition, creditworthiness
and/or prospects of Borrowers and the Subsidiaries. Except for any notices,
reports and other documents expressly required to be furnished by Agent to
Banks hereunder, Agent shall not have any duty or responsibility to provide
any Bank with any credit or other information concerning the business,
operations, property, assets, financial and other condition, creditworthiness
or prospects of Borrowers or Subsidiaries which may come into the possession
of Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
8.7. INDEMNIFICATION.
(a) Banks agree to indemnify Agent in its
capacity as such (to the extent not reimbursed by Borrowers and without
limiting any obligation of Borrowers to do so), pro-rata from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind whatsoever
which may at any time (including, without limitation, at the time following
the payment of the Obligations) be imposed on, incurred by or asserted
against Agent in any way relating to or arising out of this Agreement, the
Loan Documents or any of the Notes or any action taken or omitted by Agent
under or in connection with any of the foregoing; provided that no Bank shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements to the extent resulting solely from Agent's willful misconduct
or gross negligence.
(b) Without limiting but subject to the foregoing,
each Bank agrees to reimburse Agent promptly upon demand for its pro-rata
share of any costs and expenses incurred by Agent that are payable by
Borrowers under the Loan Documents to the extent that Agent is not promptly
reimbursed for such costs and expenses by Borrowers; and, if Agent is later
reimbursed for any such costs and expenses by Borrowers, Agent shall repay
such reimbursed amounts to Banks in proportion to the amounts Agent received
from the respective Banks on account of such costs and expenses.
(c) The agreements in this subsection shall
survive termination of this Agreement, payment of the Notes, expiration or
drawing under the Letters of Credit and payment of all other amounts payable
hereunder.
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8.8. AGENT IN ITS INDIVIDUAL CAPACITY. Agent and its
affiliates may make loans to, accept deposits from and generally engage in any
kind of business with Borrowers and the Subsidiaries as though Agent were not
Agent hereunder. With respect to the Loans made by it and all renewals,
extensions or deferrals of the payment thereof, Agent shall have the same
rights and powers under this Agreement as any Bank and may exercise the same
as though it were not Agent, and the terms "Bank" and "Banks" shall include
Agent in its individual capacity.
8.9. SUCCESSOR AGENT. If at any time it deems it advisable,
Agent may resign as Agent upon 30 days' notice to Banks but only with the
prior written consent of Parent. If Agent shall resign as Agent under this
Agreement, then Banks shall appoint a successor agent for Banks. If
appointment of a successor Agent by Banks and acceptance of the appointment by
the successor have not occurred within 30 days after Agent gives the
above-described notice of resignation, Agent may appoint a successor agent,
which shall be a commercial bank organized under the laws of the United States
or any state thereof having combined capital and surplus of at least
$250,000,000. Upon acceptance by the successor agent of the agency hereunder
and notice thereof to Borrowers, such successor agent shall succeed to the
rights, powers and duties of Agent, and the term "Agent" shall mean such
successor agent, effective upon its appointment, and the former Agent's
rights, powers and duties as Agent shall be terminated, without any other or
further act or deed on the part of such former Agent or any other parties to
this Agreement or any holders of the Notes, and such former Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring Agent's resignation or removal hereunder as Agent, the provisions of
this Article 11 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Agent under this Agreement. If at any time
hereunder there shall not be a duly appointed and acting Agent, Borrowers
agree to make each payment due hereunder and under its Notes directly to Banks
entitled thereto during such time.
8.10. AMENDMENTS AND WAIVERS. With the written consent of
the Required Banks, Agent and the appropriate parties to the Loan Documents
may, from time to time, enter into written amendments, supplements or
modifications thereof and, with the consent of the Required Banks, Agent on
behalf of Banks may execute and deliver to any such parties a written
instrument waiving, on such terms and conditions as Agent may specify in such
instrument, any of the requirements of the Loan Documents or any Default or
Event of Default and its consequences, or releasing or discharging any
guarantor from its obligations under a guarantee; provided, however, that no
such amendment, supplement, modification or waiver shall (i) increase the
commitment of any Bank, (ii) extend the maturity date of any Note, (iii)
decrease the rate of interest of, extend the time or manner of payment of or
increase or forgive the principal amount of any Note, (iv) decrease the
Closing Fee, the Letter of Credit Fee or any other fee or extend the time of
payment thereof, or (v) change the provisions of this subsection without the
consent of all of Banks; and provided further, however, that no such
amendment, supplement, modification or waiver shall amend, modify or waive any
provision of this Section 8 or otherwise change any of the rights or
obligations of Agent hereunder or under the Loan Documents without the written
consent of Agent. Any such amendment, supplement, modification or waiver shall
apply equally to each of Banks and shall be binding upon the parties to the
applicable agreement, Banks, Agent and their successors and assigns. In the
case
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of any waiver, the parties to the applicable agreement, Banks and Agent shall
be restored to their former position and rights hereunder and under the
outstanding Notes and Loan Documents, and any Default or Event of Default
waived shall not extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.
8.11. SETOFF; SHARING.
(a) Upon the occurrence of an Event of Default
and acceleration of the maturity of the Loans each Bank is hereby authorized,
at any time or from time to time thereafter, without prior notice to
Borrowers or any other Person, any such notice being hereby expressly waived,
to set-off and to appropriate and apply any and all deposits and any other
indebtedness or property at any time held or owing by such Bank to or for the
credit or the account of Borrowers, whether or not related to this Agreement
or any transaction or occurrence hereunder, against and on account of the
Obligations of Borrowers, regardless of whether or not such Bank shall have
made any demand hereunder and although such Obligations, or any of them,
shall be contingent or unmatured. The rights and remedies granted to each
Bank under this Section 8.11 shall be in addition to, and not in substitution
for, any rights or remedies, including, without limitation, any right of
set-off or banker's lien, to which such Bank may otherwise be entitled.
(b) Each Bank agrees, for the benefit of the
other Bank, that, with respect to all sums received or realized by such Bank,
after maturity of the Loans (whether by acceleration, notice of intention to
prepay in full or otherwise) equitable adjustment will be made among all of
Banks so that, in effect, all such sums shall be shared ratably by each of
Banks (based upon such Bank's percentage of the unpaid amount of all of the
Loans then outstanding owing to all of Banks), whether received by the
exercise of the right of set-off or banker's lien, by counterclaim or cross-
action, by the enforcement of any of the Notes or otherwise. If any Bank
shall, after maturity of the Loans (whether by reason of acceleration, notice
of intention to prepay in full or otherwise) receive any payment on its Loans
or on any commitment fees in a sum or sums in excess of its pro rata portion
of the sum of the aggregate principal amount of the Loans then outstanding,
then any such Bank shall, if requested by the other Bank, purchase for cash
from the other Bank an interest in its Loans in such amounts as shall result
in Banks sharing such payment ratably according to the aggregate principal
amount of the Loans then outstanding from each of them; provided, however,
that if all or any portion of such excess payment is thereafter recovered
from any such Bank, the purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest except as
required by law or by any judgment or settlement relating to such recovery.
Borrowers agrees that any Bank so purchasing a participation in the Loans
made by the other Bank may exercise all rights of set-off, banker's lien,
counterclaim or similar rights with respect to such participation as fully as
if such Bank were a direct holder of Loans in the amount of such
participation. Nothing contained herein shall require any Bank to exercise
any such right or shall affect the right of any Bank to exercise, and retain
the benefits of exercising any such right with respect to any other
indebtedness or obligation of Borrowers.
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8.12. ENFORCEMENT. Each Bank hereby authorizes Agent to take
all actions contemplated by this Agreement and any of the other Loan
Documents, and each Bank agrees that no Bank shall have any right individually
to seek or to enforce any remedy or to realize upon any security for the
Obligations, it being understood and agreed that such rights and remedies may
be exercised only by Agent, for the benefit of Banks.
Section 9. MISCELLANEOUS PROVISIONS.
9.1. MISCELLANEOUS. This Agreement, the exhibits and the
other Loan Documents are the complete agreement of the parties hereto and
supersede all previous understandings relating to the subject matter hereof.
This Agreement may be amended only in writing signed by the party against whom
enforcement of the amendment is sought. This Agreement may be executed in
counterparts. If any part of this Agreement is held invalid, illegal or
unenforceable, the remainder of this Agreement will not in any way be
affected. This Agreement is and is intended to be a continuing agreement and
will remain in full force and effect until the Loans are finally and
irrevocably paid in full and the Revolving Credit Facility is terminated.
9.2. WAIVER BY BORROWER. Each Borrower waives notice of
non-payment, demand, presentment, protest or notice of protest of any Accounts
or other Collateral, and all other notices (except those notices specifically
provided for in this Agreement); consents to any renewals or extensions of
time of payment thereof. Each Borrower hereby waives all suretyship defenses,
including but not limited to, all defenses set forth in Section 3-605 of the
Uniform Commercial Code, as revised in 1990 (the "UCC"). Such waiver is
entered to the full extent permitted by Section 3-605 (i) of the UCC.
9.3. BINDING EFFECT. This Agreement will be binding upon and
inure to the benefit of the respective legal representatives, successors and
assigns of the parties hereto; however, no Borrower may assign or transfer any
of its rights or delegate any of its Obligations under this Agreement or any
of the Loan Documents, by operation of law or otherwise. A Bank may transfer
or assign partial interests or participation in the Loans to other persons.
Banks may disclose to all prospective and actual participants all financial,
business and other information about a Borrower which Banks may possess at any
time. Absent an Event of Default, no Bank shall assign its interest in the
Loans, this Agreement or the Loan Documents except to affiliates of a Bank
(but nothing shall prohibit such Bank from selling participations herein).
9.4. SECURITY. The Obligations are secured as provided
herein, in this Agreement, the Security Agreement, in the Loan Documents and
in each other document or agreement which by its terms secures the repayment
or performance of the Obligations.
9.5. SURVIVAL. All representations, warranties, covenants and
agreements made by Borrowers herein and in the Loan Documents will survive
the execution and delivery of this Agreement, the Loan Documents and the
issuance of the Notes.
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9.6. DELAY OR OMISSION. No delay or omission on the part of
Agent or any Bank in exercising any right, remedy or power arising from any
Event of Default will impair any such right, remedy or power or any other
right remedy or power or be considered a waiver or any right, remedy or power
or any Event of Default nor will the action or omission to act by a Bank upon
the occurrence of any Event of Default impair any right, remedy or power
arising as a result thereof or affect any subsequent Event of Default of the
same or different nature.
9.7. NOTICES. Any notices under or pursuant to this
Agreement will be deemed duly sent when delivered in hand or when mailed by
registered or certified mail, return receipt requested, addressed as follows:
To Parent or Borrowers: The O'Gara Company, as agent for itself
X'Xxxx-Xxxx & Xxxxxxxxxx Armoring Company,
O'Gara Satellite Networks, Inc. and
O'Gara Satellite Networks Limited
0000 Xx Xxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Chief Financial Officer
To Agent and The Fifth Third Bank
Fifth Third: 00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Metropolitan Lending Department
To LaSalle: LaSalle National Bank
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Commercial Banking
Either party may change such address by sending written
notice of the change to the other party.
9.8. NO PARTNERSHIP. Nothing contained herein or in any of
the Loan Documents is intended to create or will be construed to create any
partnership, joint venture or other relationship between Banks and Borrowers
other than as expressly set forth herein or therein and will not create any
joint venture, partnership or other relationship.
9.9. INDEMNIFICATION. If after receipt of any payment of all
or part of the Obligations, any Bank is for any reason compelled to surrender
such payment to any person or entity, because such payment is determined to
be void or voidable as a preference, impermissible setoff, or diversion of
trust funds, or for any other reason, this Agreement will continue in full
force
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and effect and each Borrower will be liable to, and will indemnify, save and
hold such Bank, its officers, directors, attorneys, and employees harmless of
and from the amount of such payment surrendered. The provisions of this
Section will be and remain effective notwithstanding any contrary action which
may have been taken by any Bank in reliance on such payment, and any such
contrary action so taken will be without prejudice to such Bank's rights under
this Agreement and will be deemed to have been conditioned upon such payment
becoming final, indefeasible and irrevocable. In addition, each Borrower will
indemnify, defend, save and hold each Bank and Agent, its officers, directors,
attorneys, and employees harmless of, from and against all claims, demands,
liabilities, judgments, losses, damages, costs and expenses, joint or several
(including all accounting fees and attorneys' fees reasonably incurred), that
a Bank or Agent or any such indemnified party may incur arising out of this
Agreement, any of the Loan Documents or any act taken by them hereunder except
for the willful misconduct or gross negligence of such indemnified party. The
provisions of this Section will survive the termination of this Agreement.
9.10. SETOFF. In addition to, and without limitation of, any
rights of Banks under applicable law, if a Borrower becomes insolvent, however
evidenced, or any Event of Default occurs, any indebtedness from a Bank to
Borrowers may be offset and applied toward the payment of the Loans, whether
or not the Loans, or any part hereof, shall then be due.
9.11. TAXES AND FEES. Should any tax (other than a tax based
upon the net income of a Bank or franchise taxes), regulation or filing fee
become payable in respect of this Agreement, the Notes or the other Loan
Documents, or any amendment, modification or supplement hereof or thereof,
Borrowers agrees to pay the same together with any interest or penalties
thereon and agrees to indemnify and to hold Agent and Banks harmless with
respect thereto.
9.12. EXPENSES OF AGENT AND BANKS. Whether or not the
transactions contemplated by this Agreement shall be consummated, Borrowers
agrees to pay the out-of-pocket expenses of Agent and Banks (including the
fees and expenses of their counsel) in connection with the preparation,
reproduction, execution and delivery of this Agreement and the Loan Documents
and any modification, waiver or amendment hereto and thereto, and Borrowers
further agrees to pay the out-of-pocket expenses of Agent and Banks (including
the fees and expenses of their counsel) incurred in connection with the
administration, interpretation, enforcement or collection against Borrowers of
any provision of this Agreement or the Loan Documents, whether or not suit is
instituted.
9.13. GOVERNING LAW; JURISDICTION. This Agreement, the
Notes and the other Loan Documents will be governed by the domestic laws of the
State of Ohio. Each Borrower, Agent and Banks agree that the state and
federal courts in Xxxxxxxx County, Ohio, or any other court in which Agent or
a Bank initiates proceedings with respect to any Collateral have exclusive
jurisdiction over all matters arising out of this Agreement, and that service
of process in any such proceeding will be effective if mailed to each
Borrower at its address described in the Notices section of this Agreement.
AGENT, BANKS AND EACH BORROWER HEREBY WAIVE THE RIGHT TO
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TRIAL BY JURY OF ANY MATTERS ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
9.14. CONFESSION OF JUDGMENT. Each Borrower authorizes any
attorney of record to appear for it in any court of record in the State of
Ohio, after an Obligation becomes due and payable whether by its terms or upon
default, waives the issuance and service of process, releases all errors and
rights of appeal, and confesses a judgment against it in favor of the holder
of such Obligation, for the principal amount of such Obligation plus interest
thereon, together with court costs and attorneys' fees. Stay of Execution and
all exemptions are hereby waived. Each Borrower also agrees that the attorney
acting for it as set forth in this paragraph may be compensated by Banks for
such services, and each Borrower waives any conflict of interest caused by
such representation and compensation arrangement. If an Obligation is referred
to an attorney for collection, and the payment is obtained without the entry
of a judgment, the obligors will pay to the holder of such Obligation its
attorneys' fees.
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IN WITNESS WHEREOF, Borrowers, Agent and Banks have executed this
Agreement by their duly authorized officers as of the date first above
written.
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
X'XXXX-XXXX & XXXXXXXXXX THE O'GARA COMPANY, FOR ITSELF AND
ARMORING COMPANY AS AGENT FOR THE BORROWERS
By: /s/ Xxxxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxxxx X. Xxxxxxxxxx
--------------------------------- -------------------------------
Its: Exec. V.P. Its: Exec. V.P.
--------------------------------- -------------------------------
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
O'GARA SATELLITE NETWORKS, INC. O'GARA SATELLITE NETWORKS
LIMITED
By: /s/ Xxxxxxxx X. Xxxxxxxxxx By: /s/ Xxxxxxxx X. Xxxxxxxxxx
--------------------------------- -------------------------------
Its: Treasurer Its: Director
--------------------------------- -------------------------------
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LASALLE NATIONAL BANK THE FIFTH THIRD BANK, FOR ITSELF AND
AS AGENT FOR BANKS
By: /s/ Xxxx X. Xxxxxxx By: /s/ Xxxxx Xxxxxx
-------------------------- -------------------------------
Its: Senior Vice President Its: Vice President
-------------------------- -------------------------------
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EXHIBITS
TO
CREDIT AGREEMENT
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EXHIBIT 1
DEFINITIONS
-----------
1. "Acquisition Agreement" means the Share Purchase Agreement dated
January 21, 1997 with respect to the Xxxxx Acquisition.
2. "Affiliate" means, as to a Borrower, (a) any person or entity which,
directly or indirectly, is in control of, is controlled by or is
under common control with, a Borrower excluding a Subsidiary, or (b)
any person who is a director, officer or employee (i) of a Borrower
or (ii) of any person described in the preceding clause (a).
3. "Parent" means The O'Gara Company, an Ohio corporation, as agent for
the Borrowers.
4. "Applicable Margin" means Applicable LIBOR Margin or Applicable
Prime Margin.
5. "Applicable LIBOR Margin" on any date means the percentage
identified as such in Section 2.5 hereof.
6. "Applicable Prime Margin" on any date means the percentage
identified as such in Section 2.5 hereof.
7. "Bonds" means the County of Xxxxxx, Ohio Variable Rate Demand
Economic Development Revenue Bonds, Series 1986 (X'Xxxx-Xxxx &
Xxxxxxxxxx Armoring Company Limited Partnership Project).
8. "Borrowing Confirmation" has the meaning set forth in Section 2.4
hereof.
9. "Borrowing Date" means any date on which Banks shall make Revolving
Loans hereunder.
10. "Borrower Default Rate" or "Default Rate" means six percent (6%) in
excess of the interest rate otherwise in effect under amounts
outstanding under the Notes. In no event will the interest rate
accruing under such Notes be increased to be in excess of the maximum
interest rate permitted by applicable state or federal usury laws
then in effect.
11. "Business Day" means any day on which the Banks and the Federal
Reserve Bank of Cleveland is open for business.
12. "Cash Flow" means the sum of Borrowers' net income plus tax expense,
interest expense, depreciation and amortization.
13. "Compliance Certificate" shall have the meaning set forth in Section
4.2.
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14. "Contribution Agreement" means the Contribution Agreement of even
date among the Borrowers.
15. "Current Assets" means all assets which may properly be classified
as current assets in accordance with generally accepted accounting
principles, provided that for the purpose of determining the Current
Assets (i) notes and accounts receivable shall be included only if
good and collectible and payable on demand or within twelve (12)
months from the date as of which Current Assets are to be determined
(and if not directly or indirectly renewable or extendible, at the
option of the debtors, by their terms or by the terms of any
instrument or agreement relating thereto, beyond such twelve (12)
months) and shall be taken at their face value less reserves
determined to be sufficient in accordance with generally accepted
accounting principles, and (ii) the cash surrender value of life
insurance policies shall be excluded.
16. "Current Liabilities" means all Indebtedness maturing on demand or
within twelve (12) months from the date as of which Current
Liabilities are to be determined (including, without limitation,
liabilities, including taxes accrued as estimated, as may properly be
classified as current liabilities in accordance with generally
accepted accounting principles).
17. "Current Ratio" means Current Assets divided by Current Liabilities.
18. "Debt Service Coverage Ratio" means the ratio of (a) net income on a
rolling 4 quarter basis (with the inclusion of historical Xxxxx
numbers permitted) plus depreciation expense, tax expense, interest
expense and extraordinary charges minus dividends and capital
expenditures for a given time period, to (b) the sum of interest
expense, plus that portion of the principal amount of Funded
Indebtedness required to be repaid during such time period.
19. "Defaulted Amount" means, with respect to any Bank at any time, any
amount that was required to be paid by such Bank to Borrowers, Agent,
Issuing Bank or any other Bank under any Loan Document at or prior to
such time and that has not been paid by such Bank.
20. "Defaulting Bank" means, at any time, each Bank with respect to
which a Defaulted Amount exists.
21. "Eligible Accounts" means those accounts which are due and payable
within ninety (90) days from the date of invoice and are not more
than ninety (90) days old measured from the date of invoice, have
been validly assigned to Agent and strictly comply with all of
Borrowers' warranties and representations to Agent; but Eligible
Accounts shall not include the following: (a) Accounts with respect
to which the Account Debtor is a shareholder, officer, employee or
agent of a Borrower, or a corporation more than five percent (5%) of
the stock of which is owned by any of such persons; (b) Accounts
with respect to which the Account Debtor is a subsidiary of, related
to, affiliated or has common officers or directors with a
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Borrower; (c) any Accounts of a particular Account Debtor if a
Borrower is or may become liable to that Account Debtor for goods
sold or services rendered by that Account Debtor to such Borrower but
only to the extent of the amount that a Borrower is liable to such
Account Debtor; (d) any Accounts owed by a particular Account Debtor
if more than fifty percent (50%) of total balances of Accounts owed
by such Account Debtor are due with respect to invoices more than
ninety (90) days old; (e) that portion of the Accounts owed by a
particular Account Debtor (excluding the United States Government and
its agencies) which exceed 20% of all Eligible Accounts; (f) any
Accounts owed by an Account Debtor who does not meet Agent's
standards of credit worthiness, in Agent's credit judgment exercised
in good faith and in a commercially reasonable manner; and (h) any
Accounts deemed ineligible by Agent based on such credit and
collateral considerations as Agent may deem appropriate and in a
commercially reasonable manner.
22. "Eligible Inventory" means Borrowers' (i) Cost and Estimated Earnings
in Excess of Xxxxxxxx on Uncompleted Contracts (as described and
defined in Parent's financial statement in effect on the date of this
Agreement) and (ii) domestic Inventory, valued at the lower of cost
or fair market value on a first in, first out basis, in accordance
with generally accepted accounting principles consistently applied,
and excluding obsolete or unsalable items or other Inventory deemed
ineligible by Agent based on such credit and collateral
considerations as Agent may deem appropriate and in a commercially
reasonable manner.
23. "Environmental Laws" means all federal, state, local and foreign
laws relating to pollution or protection of the environment,
including laws relating to emissions, discharges, releases or
threatened releases of pollutants, contaminants, chemicals, or
industrial toxic or hazardous substances or wastes into the
environment (including without limitation ambient air, surface
water, ground water or land), or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants,
chemicals or industrial, toxic or hazardous substances or wastes,
and any and all regulations, codes, plans, orders, decrees,
judgments, injunctions, notices or demand letters issued, entered
promulgated or approved thereunder.
24. "ERISA" means the Federal Employee Retirement Income Security Act of
1974.
25. "Event(s) of Default" will have the meaning set forth in Section 6.1
of this Agreement.
26. "Excess Cash Flow" means the sum of Borrowers' Cash Flow minus cash
taxes, cash interest, capital expenditures, plus net proceeds of
equity offerings, plus decreases in Working Capital, minus increases
in Working Capital.
27. "Federal Funds Rate" means, for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted
average of the rates on overnight federal funds transactions with
members of the Federal Reserve System arranged by federal funds
brokers, as published for such day (or, if such day is not a Business
Day, for the next preceding
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Business Day) by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day that is a Business Day, the
average of the quotations for such day for such transactions received
by Agent from three federal funds brokers of recognized standing
selected by it.
28. "Funded Indebtedness" means all Indebtedness (i) in respect of money
borrowed or (ii) evidenced by a note, debenture (senior or
subordinated) or other like written obligation to pay money, or (iii)
in respect of rent or hire of property under leases or lease
arrangements which under generally accepted accounting principles are
required to be capitalized, or (iv) in respect of obligations under
conditional sales or other title retention agreements; and shall also
include all guaranties of any of the foregoing.
29. "Indebtedness" means (a) all items (except items of capital stock,
of capital surplus, of general contingency reserves or of retained
earnings, deferred income taxes, and amount attributable to minority
interests, if any) which in accordance with generally accepted
accounting principles would be included in determining total
liabilities on a consolidated basis as shown on the liability side
of a balance sheet as at the date as of which Indebtedness is to be
determined, (b) all indebtedness secured by any mortgage, pledge,
lien or conditional sale or other title retention agreement to which
any property or asset owned or held is subject, whether or not the
indebtedness secured thereby will have been assumed (excluding
non-capitalized leases which may amount to title retention
agreements but including capitalized leases), and (c) all
indebtedness of others which a Borrower or any Subsidiary has
directly or indirectly guaranteed, endorsed (otherwise than for
collection or deposit in the ordinary course of business),
discounted or sold with recourse or agreed (contingently or
otherwise) to purchase or repurchase or otherwise acquire, or in
respect of which a Borrower or any Subsidiary has agreed to apply or
advance funds (whether by way of loan, stock purchase, capital
contribution or otherwise) or otherwise to become directly or
indirectly liable, but excluding, however, the face amount of issued
and outstanding Letters of Credit for which no unreimbursed drawing
thereunder is outstanding.
30. "Interest Rate Provider" means the issuer of an Interest Rate
Agreement, which shall be LaSalle National Bank if it offers a
product on substantially the same terms, conditions and pricing as
other prospective providers of such product.
31. "Issuing Bank" means The Fifth Third Bank, as issuer of the Letters
of Credit.
32. "Xxxxx Transaction" means the purchase by O'Gara France, S.A. of all
of the outstanding shares of Xxxxx, X.X. and certain of its
subsidiaries pursuant to the Acquisition Agreement.
33. "Letter(s) of Credit" means collectively the Commercial Letters of
Credit and the IRB Letter of Credit.
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34. "Letter of Credit Facility" means the Commercial Letter of Credit
Facility and the IRB Letter of Credit Facility.
35. "Letter of Credit Liability" means, as of any date of determination,
all of the then-existing liabilities of any Borrower or any
Defaulting Bank to Issuing Bank in respect of Letters of Credit,
whether such liability is contingent or fixed, and shall consist of
the sum of (a) the aggregate stated amount of all Letters of Credit
then outstanding, plus (b) the aggregate amount that has then been
paid by, and not been reimbursed to, Issuing Bank under Letters of
Credit.
36. "Letter of Credit Note" will have the meaning set forth in Section
2.6 of this Agreement.
37. "Letter of Credit Percentage" of each Bank is its pro-rata share.
38. "Leverage Ratio" means the ratio contained in Section 5.8 of this
Agreement.
39. "LIBOR Interest Period" means any one, two or three month period
selected by Parent, commencing on any Business Day. If a LIBOR
Interest Period so selected would otherwise end on a date which is
not a Business Day, such LIBOR Interest Period shall instead end on
the next Business Day, provided, however, that if such next Business
Day shall fall in a succeeding month, such LIBOR Interest Period
shall instead end on the preceding Business Day.
40. "LIBOR Pricing Option" means the option granted pursuant to Section
2.4 hereof to have all or a portion of the interest on the principal
amount of each Pricing Loan computed with reference to a LIBOR Rate.
41. "LIBOR Rate" means, as applied to any LIBOR Interest Period, the
rate (adjusted for LIBOR Reserves if Banks are required to maintain
LIBOR Reserves with respect to the relevant loan) being asked on an
amount of Eurodollar deposits equal to the principal amount of the
Notes which is to be subject to a LIBOR Pricing Option, and which
has a maturity corresponding to the LIBOR Interest Period in
question, as reported by the TELERATE rate reporting system (or any
successor), as determined by Banks by noon of the date upon which a
LIBOR Interest Period is to commence. Each determination by Banks of
the LIBOR Rate shall be conclusive in the absence of manifest error.
42. "LIBOR Reserves" means, for any principal amount which is subject to
a LIBOR Pricing Option for any LIBOR Interest Period therefor, the
daily average maximum rate (expressed as a decimal) at which reserves
(including any marginal, supplemental or emergency reserves) are
required to be maintained during such Interest Period under
Regulation D established by the Board of Governors of the Federal
Reserve System (or any successor rule or regulation) by Banks against
"Eurocurrency Liabilities" (as such term is used in Regulation D) but
without benefit of credit or proration, exemptions or offsets that
might
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otherwise be available to Parent from time to time under Regulation
D. Without limiting the effect of the foregoing, LIBOR Reserves
shall reflect any other reserves required to be maintained by Banks
against (1) any category of liabilities that includes deposits by
reference to which the LIBOR Interest Rate for loans is to be
determined; or (2) any category of extension of credit or other
assets that are subject to an interest rate based on the LIBOR Rate.
43. "Lien" means any security interest, mortgage, pledge, assignment,
lien or other encumbrance of any kind, including interests of
vendors or lessors under conditional sale contracts and capitalized
leases.
44. "Loan Documents" means this Agreement, the Notes, the Security
Agreement, and every other document or agreement executed by any
party evidencing, guarantying or securing any of the Obligations;
and "Loan Document" means any one of the Loan Documents.
45. "Loans" means the Revolving Loans, the Term Loans and any Draw(s)
under the Letter of Credit Facility or the Reimbursement Agreement.
46. "Next Destination Transaction" means the purchase by The O'Gara
Company of Next Destination Limited, an English company.
47. "Notes" means the Revolving Note, the Term Note, the Letter of
Credit Note and any Reimbursement Agreement.
48. "Obligation(s)" means all loans, advances, indebtedness, liabilities
and obligations of any Borrower owed to Agent or any Bank or any
affiliates of a Bank or owed to the Interest Rate Provider (if such
Interest Rate Provider is a Bank or an affiliate of a Bank) of every
kind and description whether now existing or hereafter arising
including without limitation, those owed by a Borrower to others and
acquired by a Bank or any affiliate of a Bank, by purchase,
assignment or otherwise, and whether direct or indirect, primary or
as guarantor or surety, absolute or contingent, liquidated or
unliquidated, matured or unmatured, whether or not secured by
additional collateral, and including without limitation all
liabilities, obligations and indebtedness arising under this
Agreement, the Notes and the other Loan Documents, all obligations
to perform or forbear from performing acts, all amounts represented
by letters of credit now or hereafter issued by a Bank for the
benefit of or at the request of a Borrower, and all expenses and
attorneys' fees incurred by a Bank and any affiliate of a Bank under
this Agreement or any other document or instrument related to any of
the foregoing.
49. "Permitted Liens" has the meaning assigned thereto as set forth in
Section 3.9 of this Agreement.
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53
50. "Pledge Agreements" means the Pledge Agreements of even date from
any Borrower to Agent with respect to the shares of a Subsidiary, as
such agreement may be amended or modified from time to time.
51. "Pricing Option" means a LIBOR Pricing Option exercised by Parent
pursuant to the provisions hereof.
52. "Prime Rate" means the rate of interest per annum announced to be
its prime rate from time to time by Agent at its principal office in
Cincinnati, Ohio whether or not Agent will at times lend to
borrowers at lower rates of interest or, if there is no such prime
rate, then its base rate or such other rate as may be substituted by
Agent for the prime rate.
53. "pro-rata" as used herein shall mean 50-50, unless there is a
Defaulting Bank in which case pro-rata shall refer to the ratio of
one Bank's outstanding principal amount of Pricing Loans to the
Defaulting Bank's outstanding principal amount of Pricing Loans.
54. "Regulation D" means Regulation D of the Board of Governors of the
Federal Reserve System as amended or supplemented from time to time,
or any successor law, rule or regulations.
55. "Reimbursement Agreement" means the Reimbursement Agreement to which
the Issuing Bank is a party with respect to the IRB Letter of
Credit, as such document may be amended or supplemented from time to
time.
56. "Required Banks" means at any time (a) Banks, other than those
disqualified pursuant to clause (b) of this definition, whose
pro-rata share together are at least 75% of the Revolving Credit
Commitments of Banks other than those disqualified pursuant to
clause (b) of this definition; provided, however, (b) if any Bank is
a Defaulting Bank and has been a Defaulting Bank for more than
fifteen (15) days at such time, the Revolving Credit Commitment of
such Bank shall not be considered in determining the percentage set
forth in clause (a) of this definition and such Bank shall not be
entitled to a vote on any relevant matter.
57. "Revolving Credit Facility" will have the meaning set forth in
Section 2.1 of this Agreement.
58. "Revolving Loans" has the meaning assigned to that term in Section
2.1 of this Agreement.
59. "Revolving Note" has the meaning assigned to that term in Section
2.1 of this Agreement.
60. "Security Agreement" means each of the four documents entitled:
"Security Agreement" of even date herewith between a Borrower and
Agent, securing the Obligations.
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61. "Seller" means the parties to the Acquisition Agreement who are
selling stock to O'Gara France, S.A.
62. "Subordinated Debt" means Indebtedness which has been subordinated
in writing to the Obligations, in a manner satisfactory to Banks.
63. "Subsidiary" means any corporation of which a Borrower directly or
indirectly owns or controls at the time outstanding stock having
under ordinary circumstances (not depending on the happening of a
contingency) voting power to elect a majority of the board of
directors of said corporation.
64. "Tangible Net Worth" means the total of the Subordinated Debt plus
consolidated net worth determined in accordance with generally
accepted accounting principles, after eliminating all inter-company
items and all amounts properly attributable to minority interests,
if any, in the stock and surplus of any Subsidiary, MINUS the
following items (without duplication of deductions) if any,
appearing on the consolidated balance sheet of Borrowers:
(i) all deferred charges (less amortization, unamortized debt
discount and expense and corporate organization expenses);
(ii) the book amount of all assets which would be treated as
intangibles under generally accepted accounting principles,
including, without limitation, such items as good-will, trademark
applications, trade names, service marks, brand names, copyrights,
patents, patent applications and licenses, and rights with respect
to the foregoing;
(iii) the amount by which aggregate inventories or aggregate
securities appearing on the asset side of such consolidated balance
sheet exceed the lower of cost or market value (at the date of such
balance sheet) thereof;
(iv) any subsequent write-up in the book amount of any asset
resulting from a revaluation thereof from the book amount entered
upon acquisition of such asset;
(v) goodwill, other receivables due from Shareholders, and "Other
Assets" as identified on Borrowers' financial statements.
65. "Term Note" has the meaning set forth in Section 2.2
66. "Working Capital" means, in the case of any person, the amount by
which such person's Current Assets (less cash) at any given time in
any fiscal year exceed such person's Current Liabilities for such
time in such fiscal year.
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EXHIBIT 2.1
FORM OF REVOLVING NOTE
$6,000,000 Cincinnati, Ohio
_________________, 1997
On February 11, 1998, THE O'GARA COMPANY, X'XXXX-XXXX & XXXXXXXXXX
ARMORING COMPANY, O'GARA SATELLITE NETWORKS, INC. and O'GARA SATELLITE
NETWORKS LIMITED (collectively and jointly and severally, the "Borrowers"
and individually, a "Borrower") for value received, hereby jointly and
severally promise to pay to the order of ______________________________ (the
"Bank"), at Agent's offices, located at 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx,
Xxxx 00000, in lawful money of the United States of America and in immediately
available funds, the principal sum of Six Million Dollars ($6,000,000) or such
lesser unpaid principal amount as may be advanced by Bank pursuant to the
terms of the Credit Agreement of even date herewith to which Bank and
Borrowers are parties, as the same may be amended from time to time (the
"Agreement").
Principal amounts outstanding hereunder shall bear interest
commencing on the date of the first advance hereunder at the rate or rates
specified in the Agreement. Interest shall be payable quarterly on the first
day of each quarter commencing April 1, 1997 and thereafter on each July 1,
October 1 and January 1. All accrued interest shall be payable in full on the
maturity date of this Note.
All payments received by Bank under this Note will be applied first
to payment of amounts advanced by Bank on behalf of Borrowers or which may be
due for insurance, taxes and attorneys' fees or other charges to be paid by
Borrowers pursuant to the Agreement and the Loan Documents (as defined in the
Agreement), then to accrued interest on this Note, then to principal which
will be repaid in the inverse order of maturity.
This Note is a Revolving Note referred to in the Agreement, and is
entitled to the benefits, and is subject to the terms, of the Agreement.
Capitalized terms used but not otherwise defined herein will have the meanings
attributed thereto in the Agreement. The principal of this Note is prepayable
in the amounts and under the circumstances, and its maturity is subject to
acceleration upon the terms, set forth in the Agreement. Except as otherwise
expressly provided in the Agreement, if any payment on this Note becomes due
and payable on a day other than one on which Bank is open for business (a
"Business Day"), the maturity thereof will be extended to the next Business
Day, and interest will be payable at the rate specified herein during such
extension period.
After the occurrence of an Event of Default, all amounts of principal
outstanding as of the date of the occurrence of such Event of Default will
bear interest at the Default Rate, in Bank's sole
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56
discretion, without notice to Borrowers. This provision does not constitute a
waiver of any Events of Default or an agreement by Bank to permit any late
payments whatsoever.
If any payment of principal is not paid when due (whether by
acceleration or otherwise after the expiration of applicable notice grace and
cure periods, if any), Borrowers agree to pay to Agent for the benefit of Bank
a late payment fee equal to five percent (5%) of the payment amount then due.
In no event will the interest rate on this Note exceed the highest
rate permissible under any law which a court of competent jurisdiction will,
in a final determination, deem applicable hereto. In the event that a court
determines that Bank has received interest and other charges under this Note
in excess of the highest permissible rate applicable hereto, such excess will
be deemed received on account of, and will automatically be applied to reduce
the amounts due to Bank from Borrowers under this Note, other than interest,
and the provisions hereof will be deemed amended to provide for the highest
permissible rate. If there are no such amounts outstanding, Bank will refund
to Borrowers such excess.
Each Borrower and all endorsers, sureties, guarantors and other
persons liable on this Note hereby waive presentment for payment, demand,
notice of dishonor, protest, notice of protest and all other demands and
notices in connection with the delivery, performance and enforcement of this
Note, and consent to one or more renewals or extensions of this Note.
This Note may not be changed orally, but only by an instrument in
writing. This Note is being executed in Xxxxxxxx County, Ohio.
This Note is being delivered in, is intended to be performed in, will
be construed and enforceable in accordance with, and be governed by the
internal laws of, the State of Ohio without regard to principles of conflict
of laws. Each Borrower agrees that the State and Federal courts in Xxxxxxxx
County, Ohio or any other court in which Bank initiates proceedings in
accordance with the terms of the Agreement will have exclusive jurisdiction
over all matters arising out of this Note, and that service of process in any
such proceeding will be effective if mailed to a Borrower at its address
described in the Notices section of the Agreement. EACH BORROWER HEREBY WAIVES
THE RIGHT TO TRIAL BY JURY OF ANY MATTERS ARISING OUT OF THIS NOTE.
Each Borrower authorizes any attorney of record to appear for it in
any court of record in the State of Ohio, after this Note becomes due and
payable, whether by its terms or upon default, waives the issuance and service
of process, and releases all errors and rights of appeal, and confesses a
judgment against it in favor of the holder of such obligation, for the
principal amount of such obligation plus interest thereon, together with court
costs and attorneys' fees. Stay of execution and all exemptions are hereby
waived. Each Borrower also agrees that the attorney acting for such Borrower
as set forth in this paragraph may be compensated by Bank for such services,
and each Borrower waives any conflict of interest caused by such
representation and compensation
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arrangement. If an obligation is referred to an attorney for collection, and
the payment is obtained without the entry of a judgment, the obligors will pay
to the holder of such obligation its attorneys' fees.
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
X'XXXX-XXXX & XXXXXXXXXX THE O'GARA COMPANY
ARMORING COMPANY
By: ___________________________ By: ________________________________
Its: ___________________________ Its: ________________________________
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
O'GARA SATELLITE NETWORKS, INC. O'GARA SATELLITE NETWORKS
LIMITED
By: ___________________________ By: ________________________________
Its: ___________________________ Its: ________________________________
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EXHIBIT 2.2
FORM OF TERM NOTE
$8,000,000 Cincinnati, Ohio
__________, 1997
THE O'GARA COMPANY, X'XXXX-XXXX & XXXXXXXXXX ARMORING
COMPANY, O'GARA SATELLITE NETWORKS, INC. and O'GARA SATELLITE
NETWORKS LIMITED (collectively and jointly and severally, the "Borrowers" and
individually, a "Borrower") for value received, hereby jointly and severally
promise to pay to the order of __________________________ (the "Bank") at
Agent's office, 00 Xxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxx, Xxxx 00000, in lawful
money of the United States of America, the principal sum of Eight Million
Dollars ($8,000,000) together with interest as set forth herein. Principal and
interest shall be payable in immediately available funds at the principal
office of Bank. After the occurrence of any Event of Default, this Note shall
bear interest (computed and adjusted in the same manner, and with the same
effect, as interest hereon prior to maturity), payable on demand, at a rate
per annum equal to six percent (6%) above the rate that would otherwise be in
effect, until paid, and whether before or after the entry of judgment hereon
or in the alternative the Bank may impose a fixed charge of $50.00; this
provision does not constitute a waiver of any Events of Default or an
agreement by Bank to permit any late payments whatsoever.
The principal amount of this Note will be payable in 20 quarterly
installments, due on the 1st day of each quarter, as specified in the
Agreement, and the final installment shall be in the amount of the entire
unpaid principal balance and all accrued interest thereon.
This Note is a Term Note referred to in the Credit Agreement to which
the Borrowers and the Bank are parties of even date herewith, as it may be
amended from time to time (the "Agreement"), and is entitled to the benefits,
and is subject to the terms, of the Agreement. Interest on the outstanding
principal balance of this Note will accrue as provided for in the Agreement
and shall be payable on the date of each principal payment. The principal of
this Note is prepayable in the amounts and under the circumstances, and its
maturity is subject to acceleration upon the terms, set forth in the
Agreement. Except as otherwise expressly provided in the Agreement, if any
payment on this Note becomes due and payable on a day other than one on which
Bank is open for business (a "Business Day"), the maturity thereof shall be
extended to the next Business Day, and interest shall be payable at the rate
specified herein during such extension period.
In no event shall the interest rate on this Note exceed the highest
rate permissible under any law which a court of competent jurisdiction shall,
in a final determination, deem applicable hereto. In the event that a court
determines that Bank has received interest and other charges under this Note
in excess of the highest permissible rate applicable hereto, such excess shall
be deemed received on
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account of, and shall automatically be applied to reduce the amounts due to
Bank from the Borrowers under this Note, other than interest and discount
charges, in the inverse order of maturity, and the provisions hereof shall be
deemed amended to provide for the highest permissible rate. If there are no
such amounts outstanding, Bank shall refund to Borrowers such excess.
Borrowers and all endorsers, sureties, guarantors and other persons
liable on this Note hereby waive presentment for payment, demand, notice of
dishonor, protest, notice of protest and all other demands and notices in
connection with the delivery, performance and enforcement of this Note, and
one or more extensions and renewals of this Note.
This Note may not be changed orally, but only by an instrument in
writing. This Note is being executed in Xxxxxxxx County, Ohio.
This Note is being delivered in, is intended to be performed in,
shall be construed and enforceable in accordance with, and be governed by the
internal laws of, the State of Ohio without regard to principles of conflict
of laws. Each Borrower agrees that the State and federal courts in Xxxxxxxx
County, Ohio or any other court in which Bank initiates proceedings in
accordance with the terms of the Agreement have exclusive jurisdiction over
all matters arising out of this Note, and that service of process in any such
proceeding shall be effective if mailed to each Borrower at its address
described in the Notices section of the Agreement. EACH BORROWER HEREBY WAIVES
THE RIGHT TO TRIAL BY JURY OF ANY MATTERS ARISING OUT OF THIS NOTE.
Each Borrower authorizes any attorney of record to appear for it in
any court of record in the State of Ohio, after this Note becomes due and
payable, whether by its terms or upon default, waives the issuance and service
of process, and releases all errors and rights of appeal, and confesses a
judgment against it in favor of the holder of such obligation, for the
principal amount of such obligation plus interest thereon, together with court
costs and attorneys' fees. Stay of execution and all exemptions are hereby
waived. Each Borrower also agrees that the attorney acting for such Borrower
as set forth in this paragraph may be compensated by Bank for such services,
and each Borrower waives any conflict of interest caused by such
representation and compensation arrangement. If an obligation is referred to
an attorney for collection, and the payment is obtained without the entry of a
judgment, the obligors will pay to the holder of such obligation its
attorneys' fees.
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IN WITNESS WHEREOF, Borrowers and Bank have executed this Agreement
by their duly authorized officers as of the date first above written.
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
X'XXXX-XXXX & XXXXXXXXXX THE O'GARA COMPANY
ARMORING COMPANY
By: _____________________________ By: ______________________________
Its: _____________________________ Its: ______________________________
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
O'GARA SATELLITE NETWORKS, INC. O'GARA SATELLITE NETWORKS
LIMITED
By: _____________________________ By: ______________________________
Its: _____________________________ Its: ______________________________
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EXHIBIT 2.4
BORROWING CONFIRMATION
----------------------
Date: ____________________, 19____
The Fifth Third Bank, as agent
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Commercial Loan Department
Re: Credit Agreement dated (the "Credit Agreement")
-----------------------------------------------------
Pursuant to Section ___ of the Credit Agreement, we hereby confirm
that we elect a Pricing Option as follows:
1) Pricing Option selected: LIBOR
--------------
2) Amount of Funds to be subject to Pricing Option:
Revolving Loans $_______________
Term Loan $_______________
3) Starting Date:____________________
4) Duration of Pricing Option Period:___________
5) Roll Over ( ) or New Borrowing ( )
The undersigned hereby certifies that on the date hereof and on the
borrowing date, and after giving effect to the Loan requested hereby, it is
and shall be in compliance with all of the terms, covenants and conditions of
the Credit Agreement, and there exists and there shall exist no Event of
Default under the Credit Agreement.
Sincerely yours,
THE O'GARA COMPANY, as agent
By: __________________________________
Its: __________________________________
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EXHIBIT 2.6
FORM OF LETTER OF CREDIT NOTE
$2,000,000 Cincinnati, Ohio
__________________, 1997
On Demand, THE O'GARA COMPANY, X'XXXX-XXXX & XXXXXXXXXX
ARMORING COMPANY, O'GARA SATELLITE NETWORKS, INC. and O'GARA
SATELLITE NETWORKS LIMITED. (collectively and jointly and severally,
"Borrowers" and individually, a "Borrower"), for value received, hereby
jointly and severally promise to pay to the order of _________________________
(the "Bank"), at Agent's offices, located at 00 Xxxxxxxx Xxxxxx Xxxxx,
Xxxxxxxxxx, Xxxx 00000, in lawful money of the United States of America and in
immediately available funds, the principal sum of Two Million and 00/100
Dollars ($2,000,000) or such lesser unpaid principal amount as may be advanced
by Bank pursuant to the terms of the Credit Agreement of even date herewith to
which Borrowers and Bank are parties, as the same may be amended from time to
time (the "Agreement").
Principal amounts outstanding hereunder shall bear interest
commencing on the date of the first advance hereunder at the rate equal to one
percent greater than the Prime Rate (as defined below) as in effect from time
to time. The interest rate charged hereunder will change automatically upon
each change in the Prime Rate. Interest will be payable in immediately
available funds at the principal office of the Agent set forth above on the
first day of each calendar month during the term hereof. Interest will be
calculated based on a 360 day year and charged for the actual number of days
elapsed. After maturity, whether by acceleration or otherwise, this Note will
bear interest (computed and adjusted in the same manner, and with the same
effect, as interest hereon prior to maturity) payable on demand, at a rate per
annum equal to the Default Rate, until paid, and whether before or after the
entry of judgment hereon.
"Prime Rate" shall mean the rate of interest per annum established
from time to time by the Agent at its principal office in Cincinnati, Ohio,
whether or not Agent shall at times lend to borrowers at lower rates of
interest or, if there is no such prime rate, then its base rate or such other
rate as may be substituted by Agent for the prime rate; provided that in no
event shall the Prime Rate exceed the highest rate permitted by law.
The principal amount of each loan made by Bank under this Note and
the amount of each prepayment made by Borrowers under this Note will be
recorded by Bank in the regularly maintained data processing records of Bank.
The aggregate unpaid principal amount of all loans set forth in such records
will be presumptive evidence of the principal amount owing and unpaid on this
Note. However, failure by Bank to make any such entry will not limit or
otherwise affect Borrowers' obligations under this Note or the Agreement.
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All payments received by Bank under this Note will be applied first
to payment of amounts advanced by Bank on behalf of Borrowers or which may be
due for insurance, taxes and attorneys' fees or other charges to be paid by
Borrowers pursuant to the Agreement and the Loan Documents (as defined in the
Agreement), then to accrued interest on this Note, then to principal which
will be repaid in the inverse order of maturity.
This Note is a Letter of Credit Note referred to in the Agreement,
and is entitled to the benefits, and is subject to the terms, of the
Agreement. Capitalized terms used but not otherwise defined herein will have
the meanings attributed thereto in the Agreement. The principal of this Note
is prepayable in the amounts and under the circumstances, and its maturity is
subject to acceleration upon the terms, set forth in the Agreement. Except as
otherwise expressly provided in the Agreement, if any payment on this Note
becomes due and payable on a day other than one on which Bank is open for
business (a "Business Day"), the maturity thereof will be extended to the next
Business Day, and interest will be payable at the rate specified herein during
such extension period.
After the occurrence of an Event of Default, all amounts of principal
outstanding as of the date of the occurrence of such Event of Default will
bear interest at the Default Rate, in Bank's sole discretion, without notice
to Borrowers. This provision does not constitute a waiver of any Events of
Default or an agreement by Bank to permit any late payments whatsoever.
If any payment of principal is not paid when due (whether by
acceleration or otherwise after the expiration of applicable notice grace and
cure periods, if any), Borrowers agree to pay to Agent for the benefit of Bank
a late payment fee equal to five percent (5%) of the payment amount then due.
In no event will the interest rate on this Note exceed the highest
rate permissible under any law which a court of competent jurisdiction will,
in a final determination, deem applicable hereto. In the event that a court
determines that Bank has received interest and other charges under this Note
in excess of the highest permissible rate applicable hereto, such excess will
be deemed received on account of, and will automatically be applied to reduce
the amounts due to Bank from Borrowers under this Note, other than interest,
and the provisions hereof will be deemed amended to provide for the highest
permissible rate. If there are no such amounts outstanding, Bank will refund
to Borrowers such excess.
Each Borrower and all endorsers, sureties, guarantors and other
persons liable on this Note hereby waive presentment for payment, demand,
notice of dishonor, protest, notice of protest and all other demands and
notices in connection with the delivery, performance and enforcement of this
Note, and consent to one or more renewals or extensions of this Note.
This Note may not be changed orally, but only by an instrument in
writing. This Note is being executed in Xxxxxxxx County, Ohio.
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This Note is being delivered in, is intended to be performed in, will
be construed and enforceable in accordance with, and be governed by the
internal laws of, the State of Ohio without regard to principles of conflict
of laws. Each Borrower agrees that the State and Federal courts in Xxxxxxxx
County, Ohio or any other court in which Bank initiates proceedings in
accordance with the terms of the Agreement will have exclusive jurisdiction
over all matters arising out of this Note, and that service of process in any
such proceeding will be effective if mailed to each Borrower at its address
described in the Notices section of the Agreement. EACH BORROWER HEREBY WAIVES
THE RIGHT TO TRIAL BY JURY OF ANY MATTERS ARISING OUT OF THIS NOTE.
Each Borrower authorizes any attorney of record to appear for it in
any court of record in the State of Ohio, after this Note becomes due and
payable, whether by its terms or upon default, waives the issuance and service
of process, and releases all errors and rights of appeal, and confesses a
judgment against it in favor of the holder of such obligation, for the
principal amount of such obligation plus interest thereon, together with court
costs and attorneys' fees. Stay of execution and all exemptions are hereby
waived. Each Borrower also agrees that the attorney acting for such Borrower
as set forth in this paragraph may be compensated by Bank for such services,
and each Borrower waives any conflict of interest caused by such
representation and compensation arrangement. If an obligation is referred to
an attorney for collection, and the payment is obtained without the entry of a
judgment, the obligors will pay to the holder of such obligation its
attorneys' fees.
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
X'XXXX-XXXX & XXXXXXXXXX THE O'GARA COMPANY
ARMORING COMPANY
By: _____________________________ By: ______________________________
Its: _____________________________ Its: ______________________________
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WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND
COURT TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST
YOU WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO
COLLECT FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR
WHETHER FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH
THE AGREEMENT OR ANY OTHER CAUSE.
O'GARA SATELLITE NETWORKS, INC. O'GARA SATELLITE NETWORKS
LIMITED
By: _____________________________ By: ______________________________
Its: _____________________________ Its: ______________________________
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EXHIBIT 3.3
LITIGATION
O'Gara Protective Services, Inc. and Xxxxxx X. X'Xxxx v. The O'Gara
Company, X'Xxxx-Xxxx & Xxxxxxxxxx Armoring Company, and Xxxxxx X.
X'Xxxx, Civil Action C-1-9G-979 pending in U.S. District Court for
Southern District of Ohio.
Jury Xxxxxx, EEOC Matter.
-----------
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EXHIBIT 3.9
PERMITTED LIENS
1. Subordinated Stock Pledge of all shares of Next Destination
Limited.
2. UCC financing Statements being further described as follows:
DEBTOR: X'Xxxx-Xxxx & Xxxxxxxxxx
0000 XxXxxxx Xxxxx
Xxxxxxxxx, XX 00000
OHIO SECRETARY OF STATE
-----------------------
Secured Party: Xxxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: AK20536
File Date: 05/22/93
Collateral: Equipment*
Secured Party: Information Leasing Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AK72428
File Date: 01/18/94
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AK72429
File Date: 01/18/94
Collateral: Equipment*
Secured Party: Fifth Third Bank
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: AL60089
File Date: 01/31/95
Collateral: Blanket collateral*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AM16281
File Date: 09-21-95
Collateral: Equipment*
* as further described in the original financing statement
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Secured Party: Norstan Financial Services
0000 Xxxxxxxxx Xxxx, #000
Xxxxx Xxxxx, XX 00000
File Number: AM25022
File Date: 10/27/95
Collateral: Equipment*
Secured Party: Cort Furniture Rental
0000 Xxxxxx Xx.
Xxxx Xxxxxxx, XX 00000
File Number: AM64538
File Date: 4/12/96
Collateral: furniture and furnishings*
XXXXXX COUNTY
-------------
Secured Party: Xxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: 93-33928
File Date: 6/20/93
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-00332
File Date: 1/18/94
Collateral: Equipment*
Secured Party: Information Leasing Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-00333
File Date: 1/18/94
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-012583
File Date: 9/20/95
Collateral: Equipment*
Secured Party: Cort Furniture Rental
0000 Xxxxxx Xx.
Xxxx Xxxxxxx, XX 00000
File Number: 96-03846
File Date: 7/16/96
Collateral: Furniture and furnishings*
* as further described in the original financing statement
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XXXXXXXX COUNTY
---------------
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-12638
File Date: 1/20/94
Collateral: Equipment*
Secured Party: Information Leasing Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-12663
File Date: 1/20/94
Collateral: Equipment*
Secured Party: Fifth Third Bank
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-12967
File Date: 2/1/95
collateral: Blanket collateral*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-146611
File Date: 10/17/95
Collateral: Equipment*
DEBTOR: X'Xxxx-Xxxx & Xxxxxxxxxx Armoring Company
0000 XxXxxxx Xxxxx
Xxxxxxxxx, XX 00000
OHIO SECRETARY OF STATE
-----------------------
Secured Party: PNC Bank, Ohio
000 Xxxxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: X80531
File Date: 9/30/86
Collateral: Blanket collateral*
Secured Party: Central Trust Company
000 X. Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: Y88578
File Date: 1/14/88
Collateral: Blanket collateral*
* as further described in the original financing statement
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Secured Party: Central Trust Company
000 X. Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: Y88177
File Date: 1/13/88
Collateral: blanket collateral*
Secured Party: General Motors Acceptance Corporation
0000 Xxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
File Number: AK83347
File Date: 03/10/94
Collateral: Inventory of motor vehicles and motor
vehicle chassis*
Secured Party: Xxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: AL26371
File Date: 09/06/94
Collateral: Equipment*
Secured Party: Xxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: AL81929
File Date: 05/01/95
Collateral: Equipment*
Secured Party: PNC Leasing Corp.
Xxxxx Xxxxxx & Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AL45387
File Date: 11/28/94
Collateral: Equipment*
Secured Party: PNC leasing Corp.
Xxxxx Xxxxxx & Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AL77181
File Date: 04/12/95
Collateral: Equipment*
Secured Party: AM General Corporation
000 X. Xxxxx Xxxxxx
Xxxxx Xxxx, XX 00000
File Number: AM50633
File Date: 02/20/96
Collateral: Equipment*
* as further described in the original financing statement
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Secured Party: The CIT Group/Equipment Financing, Inc.
X.X. Xxx 00000
Xxxxx, XX 00000-0000
File Number: AL63507
File Date: 02/15/95
Collateral: Equipment*
Secured Party: The CIT Group/Equipment Financing, Inc.
X.X. Xxx 00000
Xxxxx, XX 00000-0000
File Number: AL63507
File Date: 02/15/95
Collateral: Equipment*
Secured Party: Ikon Capital
X.X. Xxx 0000
Xxxxx, XX 00000-0000
File Number: AN18367
File Date: 11/15/96
Collateral: Equipment*
XXXXXX COUNTY
-------------
Secured Party: The Central Trust Company, N.A.
as Trustee and as letter of Credit Bank
NKA PNC Bank, Ohio, N.A.
000 Xxxxxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 86-20631 - fixture filing
File Date: 9/25/86
Collateral: Personal property and fixtures*
Secured Party: The Central Trust Company, N.A.
The Central Trust Company, N.A., Trustee
Xxxxx & Xxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
File Number: 88-31645
File Date: 01/11/88
Collateral: Receivables, Inventory, Equipment,
General Intangibles, Proceeds and
Products thereof*
Secured Party: The Central Trust Company, N.A.
Central Trust Center
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
File Number: 88-31734
File Date: 1/12/88
Collateral: Receivables, Inventory, Equipment,
General Intangibles, Proceeds and
Products thereof*
* as further described in the original financing statement
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Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 93-35094
File Date: 07/20/93
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 93-35095
File Date: 07/20/93
Collateral: Equipment*
Secured Party: General Motors Acceptance Corporation
0000 Xxxx Xxxxx, Xxxxx 000
Xxxxx, XX 00000
File Number: 94-14024
File Date: 03/11/94
Collateral: Inventory of motor vehicles and motor
vehicle chassis*
Secured Party: Xxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-4702
File Date: 08/11/94
Collateral: Equipment*
Secured Party: PNC Leasing Corp.
Xxxxx Xxxxxx & Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 94-006569
File Date: 11/28/94
Collateral: Equipment*
Secured Party: PNC Leasing Corp.
Xxxxx Xxxxxx & Xxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-9370
File Date: 4/14/95
Collateral: Equipment*
Secured Party: Xxxx Leasing Co.
0000 Xxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-009442
File Date: 4/18/95
Collateral: Equipment*
* as further described in the original financing statement
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Secured Party: Ikon Capital
X.X. Xxx 0000
Xxxxx, XX 00000-0000
File Number: 96-06355
File Date: 11/12/96
Collateral: Equipment*
XXXXXXXX COUNTY
---------------
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 93-125933
File Date: 07/22/93
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 93-125952
File Date: 07/22/93
Collateral: Equipment*
DEBTOR: O'Gara Satellite Networks, Inc.
0 Xxxxxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
OHIO SECRETARY OF STATE
-----------------------
Secured Party: Information Leasing Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AL70365
File Date: 03/16/95
Collateral: Equipment*
Secured Party: Star Bank, National Association
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: AM32653
File Date: 11/29/95
Collateral: Equipment*
XXXXXX COUNTY
-------------
Debtor: O'Gara Satellite Networks, Inc.
0000 XxXxxxx Xxxxx
Secured Party: Fifth Third Bank
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-9355
File Date: 04/13/95
Collateral: Blanket collateral*
* as further described in the original financing statement
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XXXXXXXX COUNTY
---------------
Secured Party: Information Leasing Corporation
0000 Xxxx 0xx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-33266
File Date: 03/17/95
Collateral: Equipment*
Secured Party: Star Bank, N.A.
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
File Number: 95-162409
File Date: 11/15/95
Collateral: Equipment*
3. Mortgages granted by X'Xxxx-Xxxx & Xxxxxxxxxx Armoring
Company in favor of PNC Bank Ohio, N.A. encumbering
0000 XxXxxxx Xxxxx, Xxxxxxxxx, Xxxx and 00000
Xxxxxxxxx, Xxxxxxxxxx, Xxxx 00000.
4. Liens for non-delinquent real estate taxes and installments
of assessments.
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EXHIBIT 3.12
SUBSIDIARIES AND PARTNERSHIPS
-----------------------------
X'XXXX-XXXX & XXXXXXXXXX ARMORING COMPANY
0000 XxXxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
X'XXXX-XXXX & XXXXXXXXXX ARMORING COMPANY DE MEXICO
Adromaco 23
Ampliacion Granada
11520 Mexico, D.F.
Ciudad de Mexico
X'XXXX-XXXX & XXXXXXXXXX ARMORING COMPANY DO BRASIL
Av. Tambore, #1,393
Barueri, S.P. 00000-000
Xxxxxx
O'GARA SECURITY INTERNATIONAL
Krasnopresnenskaya Xxx. 00,
Xxxxxxxxxx Xxxxxx, 0xx. Xxxxx
Xxxxxx, Xxxxxx 000000
XXXXX-X'XXXX AUTOMOTIVE GROUP
Xxxxx-Xxxxxxxxxx
0 Xxxxxxxx Xxxxxx
193C15 Russia
O'GARA FRANCE, XX
XXXXX, SA
X.X. Xxx x'Xxxxx
X- 00000 Xxxxxxxx Xxxxx
SOCIETE DE BLINDAGE AND DE SECURITE
00, Xxxxx X'Xxxxxxx
X - 00000 Xxxxxxxx
NORMANDI CAROSSERI S.A.R.L.
00 xxx Xxxxx Xxxxxx
X - 00000 Xxxxxxxxxx
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HELLIO POIDS-LOURDS
Z.A. La Hazaie
F. - 22950 Tregueux
X'XXXX-XXXX & XXXXXXXXXX ARMORING COMPANY LIMITED
X'XXXX-XXXX & XXXXXXXXXX ARMORING SRL (ITALY)
O'GARA SATELLITE NETWORKS LIMITED
Xxx Xxxxxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
OGM COMMUNICATIONS (IRELAND)
O'GARA SATELLITE NETWORKS INC.
Xxx Xxxxxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
NEXT DESTINATION LIMITED
Xxxx 0, Xxxxxx Xxxxx Lease of 25
The Clarendon Centre
Xxxxxxxxx Xxxxxxxx Xxxx, Xxxxxxxxx XX0 0XX
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EXHIBIT 7.1(b)
[FORM FOR PARENT - SIMILAR CERTIFICATES REQUIRED FOR EACH BORROWER]
THE O'GARA COMPANY
CERTIFICATE OF BORROWER
re: $33,500,000 Loan Facility
from
THE FIFTH THIRD BANK
and
LaSALLE NATIONAL BANK
The undersigned does hereby certify that he is the duly elected,
qualified and acting Secretary of THE O'GARA COMPANY, an Ohio corporation (the
"Borrower"), and the undersigned does hereby further certify as follows:
1. Attached hereto, marked Attachment A, is a true and correct copy of
the current Articles of Incorporation of Borrower together with all
amendments thereto.
2. Attached hereto, marked Attachment B, is a true and correct copy of
the current Bylaws of Borrower together with all amendments thereto.
3. Attached hereto, marked Attachment C, is a true and correct copy of
certain resolutions of the board of directors of Borrower dated ,
1997, which were duly and lawfully adopted by the board of directors
of Borrower. Such resolutions have not been amended, altered or
rescinded and are in full force and effect on the date hereof.
4. The following persons are the duly elected officers of Borrower,
holding the office set forth opposite their respective names. Each
officer who has executed or will execute any documents in connection
with this loan transaction has set forth his true and customary
signature opposite his name.
Name Title Signature
__________________ ______________________ ____________________
__________________ ______________________ ____________________
__________________ ______________________ ____________________
__________________ ______________________ ____________________
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5. Each officer whose personal signature appears above has been duly
authorized by resolution of the board of directors of Borrower to
execute any and all instruments or documents which he may deem
necessary or appropriate in connection with this loan transaction.
6. Borrower is in good standing in the state of its incorporation.
Attached hereto, marked Attachment D, is a short-form certificate of
good standing issued within the past 30 days by that state.
IN WITNESS WHEREOF, the undersigned hereby certifies the above to be
true and has executed this certificate this ______ day of
______________________, 1997.
------------------------------
, Secretary
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EXHIBIT 7.1(C)
OPINION OF COUNSEL FOR BORROWER
-------------------------------
The Fifth Third Bank LaSalle National Bank
00 Xxxxxxxx Xxxxxx Xxxxx 000 X. XxXxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000 Xxxxxxx, Xxxxxxxx 00000
Attention: Metropolitan Lending Department Attention: Commercial Banking
Re: THE O'GARA COMPANY, X'XXXX-XXXX & XXXXXXXXXX ARMORING
COMPANY, O'GARA SATELLITE NETWORKS, INC. and O'GARA
SATELLITE NETWORKS LIMITED
Gentlemen:
We have acted as general counsel for The O'Gara Company, X'Xxxx-Xxxx
& Xxxxxxxxxx Armoring Company, O'Gara Satellite Networks, Inc. and O'Gara
Satellite Networks Limited collectively, the "Borrowers" and individually, a
"Borrower"), in connection with the negotiation and execution of the Credit
Agreement of even date herewith between you and Borrowers (the "Credit
Agreement"), four Security Agreements of even date herewith, the Revolving
Note, the Term Note and the Letter of Credit Note of Borrowers, each dated of
even date herewith (collectively the "Notes") and [LIST OTHER COLLATERAL
DOCUMENTS] (all of which will be collectively referred to as the "Loan
Documents"). All capitalized terms not defined herein have the meanings set
forth in the Credit Agreement. As general counsel for Borrowers, we have made
such investigations as we have deemed necessary in connection with the
opinions hereinafter set forth.
Based upon such investigations, it is our opinion that:
1. Each Borrower is a corporation duly organized and validly existing
under the laws of the state of its incorporation, having full
corporate power and authority to execute and deliver and to carry out
and perform its obligations under the Loan Documents;
2. The execution and performance of the Loan Documents have been duly
authorized by all necessary corporate action of Borrowers and the
Loan Documents have been duly executed and delivered by Borrowers and
are valid and binding obligations of Borrowers enforceable in
accordance with their respective terms, except to the extent that
enforcement thereof may be limited by equitable principles or by
bankruptcy, insolvency or other similar laws affecting the rights of
creditors generally;
3. To our knowledge, after due investigation, the execution and
delivery of the Loan Documents and the performance by each Borrower
of its obligations thereunder do not and
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will not conflict with or constitute on the part of such Borrower a
breach of or default under the articles of incorporation or code of
regulations governing each Borrower, any existing law, regulation,
court order or consent decree to which each Borrower is subject, or
any agreement, indenture, note, mortgage, or other obligation or
instrument to which each Borrower is a party or by which it may be
bound;
4. There is not pending, or to our knowledge, after due investigation,
threatened, any action, suit, proceeding (at law or in equity) or
investigation before or by any court, administrative agency, or
public board or body against a Borrower or its properties;
5. To our knowledge, nothing has come to our attention in our
representation of Borrowers under a Borrower's governing instruments
or other documents binding upon such Borrower that would prohibit
Borrowers from granting to Bank a perfectible security interest in
the Collateral;
6. The execution, delivery and performance by Borrowers of the Loan
Documents are not subject to any authorization, consent, approval or
review by any governmental body or regulatory authority not
heretofore obtained or affected; and
7. The Notes are not usurious under the governing laws.
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EXHIBIT 7.2
COLLATERAL REPORT
THE FIFTH THIRD BANK, as agent
I. Total Accounts as of ____________, 19__ $__________
Less: Accounts Over 90 Days From Invoice $__________
50% Rule $__________
Other (Employee, Contra Accts., Etc.) $__________
Eligible Accounts $__________
Advance Rate X __%
LOAN AVAILABILITY - ACCOUNTS $
==========
II. Total Inventory Collateral as of ________, 19__ $__________
Less: Inventory on Consignment $__________
Customer Deposits $__________
Cost and Estimated Earnings in Excess of Xxxxxxxx
on Uncompleted Contracts $__________
Eligible Inventory $__________
Advance Rate X __%
LOAN AVAILABILITY - INVENTORY $
==========
TOTAL LOAN AVAILABILITY
(Sum of I and II) $
==========
The terms and conditions of this Collateral Report are governed by Credit
Agreement dated _________, 1997, (hereinafter referred to as the "Agreement")
with The Fifth Third Bank and LaSalle National Bank ("Banks"); all
definitions, undertakings, obligations, covenants and
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warranties applicable to Borrowers under the Agreement including, without
limitation, the assignment by Borrowers to Banks of collateral, are hereby
acknowledged by Borrowers to be in fully force and effect.
The undersigned, agent for the Borrowers, by execution hereof,
warrants and represents the following:
a) There exists no Default or Event of Default, as defined,
pursuant to the Agreement;
b) Borrowers have read and are familiar with the Agreement,
understand each term and condition set forth therein,
undertake to comply therewith and will obtain, if necessary,
from Banks a copy of the Agreement for review of Borrowers'
obligations thereunder;
c) Except for Permitted Liens, there exists no lien,
encumbrance, legal proceeding or other similar act or
condition which would impair, restrict or limit a Bank's
rights with respect to collateral pledged pursuant to the
Agreement, including, without limitation, items of
collateral reported herein;
d) Borrowers represent and warrant that the collateral
balances reported herein are true and correct.
THE O'GARA COMPANY, as agent
Dated: __________, 19___ By: ____________________________________
Its: _____________________________________
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EXHIBIT 8.5
SECURITY AGREEMENT
------------------
[FORM FOR PARENT - SIMILAR DOCUMENT TO BE PROVIDED FOR EACH BORROWER]
THIS SECURITY AGREEMENT is entered into as of the ______ day of
_________, 1997, by and between THE O'GARA COMPANY, an Ohio corporation (the
"Borrower") and THE FIFTH THIRD BANK, an Ohio banking corporation, as agent
(the "Agent") for the Banks that are signatories to the Credit Agreement
(hereinafter defined) (collectively, the "Banks" and individually a "Bank").
Section 1. DEFINITIONS.
1.1. SPECIFIC DEFINITIONS. The following definitions will apply:
(a) "Account Debtors" means Borrower's customers and all
other persons obligated to Borrower on Accounts.
(b) "Accounts" means all accounts, accounts receivable,
contract rights, instruments, documents, chattel paper, and all obligations
in any form including but not limited to those arising out of the sale or
lease of goods or the rendition of services by Borrower; all guaranties,
letters of credit and other security for any of the above; all merchandise
returned to or reclaimed by Borrower; and all books and records (including
computer programs, tapes and data processing software) evidencing an interest
in or relating to the above.
(c) "Equipment" means all machinery, machine tools,
equipment, fixtures, office equipment, furniture, furnishings, motors, motor
vehicles, tools, dies, parts, jigs, goods (including, without limitation,
each of the items of equipment set forth on any schedule which is either now
or in the future attached to Agent's copy of this Agreement), and all
attachments, accessories, accessions, replacements, substitutions, additions
and improvements thereto, and all supplies used or useful in connection
therewith.
(d) "General Intangibles" means all general intangibles,
choses in action, causes of action, obligations or indebtedness owed to
Borrower from any source whatsoever, and all other intangible personal
property of every kind and nature (other than Accounts) including without
limitation patents, trademarks, trade names, service marks, copyrights and
applications for any of the above, and goodwill, trade secrets, licenses,
franchises, rights under agreements, tax refund claims, and all books and
records including all computer programs, disks, tapes, printouts, customer
lists, credit files and other business and financial records, and the
equipment containing any such information.
(e) "Inventory" means any and all goods, supplies, wares,
merchandises and other tangible personal property, including raw materials,
work in process, supplies and
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components, and finished goods, whether held for sale or lease, or furnished
or to be furnished under any contract for service, or otherwise and also
including products of and accessions to inventory, packing and shipping
materials, and all documents of title, whether negotiable or non-negotiable,
representing any of the foregoing.
(f) "Lien" means any security interest, mortgage, pledge,
assignment, lien or other encumbrance of any kind, including interests of
vendors or lessors under conditional sale contracts or capital leases.
(g) "Life Insurance Policy" means a $3,000,000 life
insurance policy on the life of Xxxxxxx X'Xxxx, duly assigned to Agent
pursuant to an acceptable collateral assignment, issued by an entity
acceptable to Agent.
(h) In addition to the foregoing, the definitions of the
terms Accounts, Inventory, Equipment and General Intangibles will have the
meanings attributed thereto in the applicable version of the Uniform
Commercial Code adopted in the jurisdiction where Agent's principal place of
business is located, as such definitions may be enlarged or expanded from
time to time by amendment or judicial decision.
1.2. OTHER DEFINITIONS. Capitalized terms not defined herein
have the meanings set forth in the Credit Agreement of even date herewith to
which Borrower and Agent are parties (the "Credit Agreement"). All other
undefined terms will have the meaning given to them in the Ohio Uniform
Commercial Code. Agent is acting under this Agreement in its capacity as agent
for all Banks specified in the Credit Agreement. All references to Agent in
this Agreement shall refer to Agent, as agent for all Banks.
Section 2. SECURITY.
2.1. SECURITY INTEREST OF AGENT. To induce Banks to make the
Loans, and as security for all Obligations of Borrower to the Agent and the
Banks, Borrower hereby assigns to the Agent (for the ratable benefit of the
Agent and the Banks) as collateral and grants to the Agent (for the ratable
benefit of the Agent and the Banks) a continuing first priority pledge and
security interest in the following property of Borrower (the "Collateral"),
whether now owned or existing or hereafter acquired or arising and regardless
of where it is located:
(a) all Accounts;
(b) all Inventory;
(c) all Equipment;
(d) all General Intangibles;
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(e) all proceeds and products of Collateral and all
additions and accessions to, replacements of, insurance or condemnation
proceeds of, and documents covering Collateral, all tort or other claims
against third parties arising out of damage or destruction of Collateral, all
property received wholly or partly in trade or exchange for Collateral, all
fixtures, all leases of Collateral and all rents, revenues, issues, profits
and proceeds arising from the sale, lease, license, encumbrance, collection,
or any other temporary or permanent disposition, of the Collateral or any
interest therein;
(f) all instruments, chattel paper, documents,
securities, money, cash, letters of credit, warrants, dividends,
distributions, contracts, agreements, contract rights or other property,
owned by Borrower or in which Borrower has an interest, which now or
hereafter are at any time in the possession or control of Agent or in transit
by mail or carrier to or in the possession of any third party acting on
behalf of Agent, without regard to whether Agent received the same in pledge,
for safekeeping, as agent for collection or transmission or otherwise or
whether Agent had conditionally released the same, and the proceeds thereof,
all rights to payment from all claims against Agent, and any deposit accounts
of Borrower with Agent, including certificates of deposit, all demand, time,
savings, passbook or other accounts; and
(g) the Life Insurance Policy.
2.2. Representations in Schedule I. The representations and
warranties in Schedule I attached hereto entitled the Specific Representation
Schedule are true and correct as of this date. Except as otherwise permitted
hereunder, Borrower will not change its name, transfer executive offices or
maintain records with respect to Accounts at any location other than the present
locations specified in that schedule.
2.3. PROVISIONS CONCERNING ACCOUNTS. Borrower represents and
warrants that each Account reflected in Borrower's books and records and on
each Collateral Report submitted to Agent is, or at the time it arises will be
owned by Borrower free and clear of all Liens in favor of any third party,
will be a bona fide existing obligation created by the final sale and delivery
goods or the completed performance of services by Borrower in the ordinary
course of its business, will be for a liquidated amount maturing as stated in
the supporting data covering such transaction, and will not be subject to any
known deduction, offset, counterclaim, return privilege or other condition,
except as reflected on Borrower's books and records and on all Collateral
Reports delivered to Agent. Borrower will not redate any invoices. Any
allowances between Borrower and its customers will be in accordance with the
usual customary practices of Borrower, as they exist at this time.
(a) Any officer, employee or agent of Agent will have the
right, at any time or times hereafter, in the name of Agent or its nominee
(including Borrower), to verify the validity, amount or any other matter
relating to any Accounts by mail, telephone, or otherwise. Agent or its
designee may at any time notify Account Debtors that Accounts have been
assigned to Agent or of Agent's security interest therein, and after an Event
of Default hereunder collect the same directly and charge all collection
costs and expenses to Borrower's account.
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(b) If Borrower becomes aware that an Account Debtor
disputes liability or makes any claim with respect to an Account in excess of
$10,000 or that a receivership petition or petition under any chapter of the
federal bankruptcy act is filed by or against an Account Debtor, or that an
Account Debtor dissolves, makes an assignment for the benefit of creditors,
becomes insolvent, fails or goes out of business, or that any other event
occurs which adversely affects the value of any Account owed by a debtor,
Borrower will immediately notify Agent of each such event where such event is
material in nature. After default by Borrower hereunder, Borrower will not
grant any discounts, credit or allowances to any Account Debtor and will not
accept returns of merchandise without Agent's consent. After an Event of
Default hereunder, Agent may settle disputes and claims directly with Account
Debtors, and in such cases, Agent will credit Borrower's account with the net
amounts collected from such disputed Accounts, after expenses of collection.
(c) Borrower appoints Agent or Agent's designee as its
attorney-in-fact to endorse Borrower's name on any checks, notes,
acceptances, money orders, drafts or other forms of payment or security that
may come into Agent's possession; to sign Borrower's name on any invoice or
xxxx of lading relating to any Accounts or Inventory, on drafts against
Account Debtors, on schedules and assignments of Accounts or Inventory, on
notices of assignment and other public records, on verifications of Accounts
and on notices to Account Debtors; to notify post office authorities to
change the address for delivery of Borrower's mail to an address designated
by Agent, to receive and open all mail addressed to Borrower and to retain
all mail relating to Collateral and forward all other mail to Borrower; to
send requests for verification of accounts to customers or Account Debtors,
and to do all things necessary to carry out or enforce this Agreement.
Borrower ratifies and approves all acts of Agent as attorney-in-fact. Agent
as attorney-in-fact will not be liable for any acts or omissions, or for any
error of judgment or mistake of fact or law except for bad faith. This power,
being coupled with an interest, is irrevocable until all Obligations have
been fully satisfied; provided that Agent will not exercise this power until
after Event of Default has occurred hereunder and is continuing.
(d) If any Accounts will arise out of a contract with the
United States of America or any department, agency, subdivision or
instrumentality thereof, Borrower will promptly notify Agent and will perfect
Agent's Lien in such Accounts under the provisions of the Federal laws on
assignment of claims.
2.4. PROVISIONS CONCERNING GENERAL INTANGIBLES. Borrower
represents and warrants that Borrower owns all of the General Intangibles in
which Borrower grants Agent a Lien, free and clear of any Liens in favor of
any person other than Agent and except for liens permitted under the Credit
Agreement. Borrower will preserve all patents, trademarks, copyrights and the
like which are necessary or which Borrower determines are useful for the
conduct of its business.
2.5. PROVISIONS CONCERNING INVENTORY. Borrower represents
and warrants that each item of Inventory will be valued by Borrower at the
lower of cost or market on a FIFO basis for purpose of reporting to the
Agent. Borrower has informed Agent on Schedule I of all places
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where Borrower currently maintains Inventory or has maintained Inventory at
any time during the past four months, including, without limitations,
facilities leased and operated by Borrower and locations neither owned nor
leased by Borrower. Schedule I indicates whether the premises are those of a
warehouseman or other party. No Inventory will be removed from the current
locations or stored at locations other than the current locations disclosed to
Agent on Schedule I, except (i) for the purpose of sale in the ordinary course
of Borrower's business or (ii) upon 30 days' written notice to Agent, to such
other locations as to which all action required to perfect and protect Agent's
lien in such Inventory has been taken. Inventory may be moved from one current
location to another.
(a) Borrower will keep all Inventory in good order and
condition and will maintain full, accurate and complete books and records
with respect to Inventory at all times.
(b) Borrower may sell Inventory in the ordinary course of
its business (which does not include a transfer in full or partial
satisfaction of indebtedness).
(c) If any material portion of the Inventory is stored
with a bailee, warehouseman or similar party at any time, Borrower so storing
such Inventory will inform Agent of that fact and will take all steps
reasonably requested by Agent so that Agent retains a first priority
perfected Lien in those assets.
(d) Borrower has not purchased any of the Collateral in a
bulk transfer or in a transaction which was outside the ordinary course of
the seller's business, except as set forth on an exhibit attached hereto.
2.6. PROVISIONS CONCERNING EQUIPMENT. Borrower warrants and
represents that Borrower has informed Agent on Schedule I of all places where
any of Borrower's Equipment is currently located or has been located at any
time during the past four months. No Equipment will be moved to any location
not disclosed to Agent on Schedule I but Equipment may be moved from one such
location to another. In addition, Borrower may move Equipment from job site to
job site or to another location provided that Borrower will provide Agent with
prior written notice if any Equipment with a book value in excess of $50,000
is to be moved to and maintained at a particular job site or to another
location for a period in excess of three months.
(a) Borrower will keep and maintain the Equipment in good
operating condition and repair (ordinary wear and tear excepted), make all
necessary replacements so that its value and operating efficiency is
maintained and preserved. Borrower will immediately notify Agent of any
material loss or damage to the Collateral.
(b) Borrower will immediately deliver to Agent all
certificates of title or applications for title or the like for any vehicles
(excluding vehicles consisting of Inventory), ships or airplanes covered by
certificates of title. Borrower will take all steps necessary to perfect
Agent's Lien in such assets.
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(c) Borrower will not permit any item of Equipment to
become a fixture to real estate or accession to other property (unless
subject to a fixture filing in favor of Agent) and the Equipment is now and
except for Equipment subject to a fixture filing will at all times remain and
be personal property, except with the prior written consent of Agent. If any
of the Collateral is or may become a fixture, Borrower will obtain from all
persons with an interest in the relevant real estate such waivers or
subordinations as Agent reasonably requires.
2.7. LIFE INSURANCE POLICY. Borrower represents and warrants
that it has not borrowed against the Life Insurance Policy, from the issuer
thereof or from any other person. Borrower shall maintain in force the Life
Insurance Policy and pay all premiums thereon when due, and shall not borrow
against or reduce the amount of the death benefit under the Life Insurance
Policy.
2.8. LIENS. Borrower has good and marketable title to its
respective Collateral, and the Liens granted to Agent in this Agreement are
fully perfected first priority Liens in the Collateral with priority over the
rights of every person other than Borrower in the Collateral. Other than
rented items and items for which Borrower is providing services, Borrower is
the owner of all personal property in its possession, and all assets of
Borrower are owned free, clear and unencumbered, except for the Lien of Agent
and except for Liens imposed by law which secure amounts not yet due and
payable and Permitted Liens.
2.9. FURTHER ASSURANCES. Borrower will execute and deliver
to Agent at its request all financing statements, continuation statements and
other documents that Agent may reasonably request, in form satisfactory to
Agent, to perfect and maintain perfected Agent's security interest in the
Collateral and to fully consummate all transactions contemplated under this
Agreement. Borrower hereby irrevocably makes, constitutes and appoints Agent
(and any of Agent's officers, employees or agents designated by Agent) as
Borrower's true and lawful attorney with power to sign the name of Borrower on
any such documents.
(a) If any Collateral, including proceeds, consists of a
letter of credit, advice of credit, instrument, money (excluding funds in
bank accounts other than with Agent), negotiable documents, chattel paper or
similar property (collectively, "Negotiable Collateral") Borrower will,
immediately upon request by Agent, endorse and assign such Negotiable
Collateral over to Agent and deliver actual physical possession of the
Negotiable Collateral to Agent.
(b) Agent may inspect and verify Borrower's books and
records at any time or times hereafter, during usual business hours, in order
to verify the amount or condition of the Collateral, or any other matter
relating to the Collateral or Borrower's financial condition. Borrower will
promptly deliver to Agent copies of all books and records requested by Agent.
2.10. OTHER AMOUNTS DEEMED LOANS. If Borrower fails to pay any
tax, assessment, government charge or levy or to maintain insurance within the
time permitted by this Agreement or the Credit Agreement, or to discharge any
Lien prohibited hereby, or to comply with any other
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obligation, Agent may, but will not be required to, pay, satisfy, discharge or
bond the same of the account of Borrower, and to the extent permitted by law
and all monies so paid out will be secured by the Collateral.
2.11. BORROWER REMAINS LIABLE. Borrower will remain liable under
any contracts and agreements included in the Collateral to perform all of its
duties and obligations thereunder to the same extent as if this Agreement had
not been executed, and Agent will not have any obligation or liability under
such contracts and agreements by reason of this Agreement or otherwise.
2.12. INSURANCE. Borrower will insure the Collateral against loss
or damage of the kinds and in the amounts customarily insured against by
corporations with established reputations engaged in the same or similar
business as Borrower. All such policies will (a) be issued by financially sound
and reputable insurers, (b) name Agent as an additional insured and, where
applicable, as loss payee under a lender loss payable endorsement satisfactory
to Agent, and (c) will provide for thirty (30) days written notice to Agent
before such policy is altered or canceled all of which will be evidenced by a
Certificate of Insurance delivered to Agent by Borrower on the date of execution
of this Agreement.
Section 3. EVENTS OF DEFAULT AND REMEDIES.
3.1. EVENTS OF DEFAULT. Any Event of Default under the Credit
Agreement constitutes an "Event of Default" under this Agreement.
3.2. REMEDIES. If any Event of Default occurs and is continuing,
in addition to the remedies provided in the Credit Agreement:
(a) Agent may resort to the rights and remedies of a secured
party under the Uniform Commercial Code including the right to enter any
premises of Borrower, with or without legal process and take possession of the
Collateral and remove it and any records pertaining thereto and/or remain on
such premises and use it for the purpose of collecting, preparing and disposing
of the Collateral;
(b) Agent may ship, reclaim, recover, store, finish, maintain
and repair the Collateral, and may sell the Collateral at public or private
sale, and Borrower will be credited with the net proceeds of such sale only when
they are actually received by Agent and any requirement of reasonable notice of
any disposition of the Collateral will be satisfied if such notice is sent to
Borrower 10 days prior to such disposition;
(c) Borrower will upon request of Agent assemble the
Collateral and any records pertaining thereto and make them available at a place
designated by Agent; or
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(d) Agent may use, in connection with any assembly or
disposition of the Collateral, any trademark, trade name, tradestyle, copyright,
patent right, trade secret or technical process used or utilized by Borrower.
3.3. NO REMEDY EXCLUSIVE. No remedy set forth herein is exclusive
of any other available remedy or remedies, but each is cumulative and in
addition to every other remedy given under this Agreement or the Credit
Agreement or now or hereafter existing at law or in equity or by statute.
Section 4. MISCELLANEOUS PROVISIONS.
4.1. MISCELLANEOUS. No delay or omission to exercise any right
will impair any such right or be a waiver thereof, and a waiver on one
occasion will be limited to that particular occasion. This Agreement may be
amended only in writing signed by the party against whom enforcement of the
amendment is sought. This Agreement may be executed in counterparts. If any
part of this Agreement is held invalid, the remainder of this Agreement will
not be affected thereby.
4.2. BINDING EFFECT. This Agreement will be binding upon and
inure to the benefit of the respective legal representatives, successors and
assigns of the parties hereto; however, Borrower may not assign any of its
rights or delegate any of its obligations hereunder. Agent (and any subsequent
assignee) may transfer and assign this Agreement or may assign partial
interests or participation in the Loans to other persons.
4.3. FINANCING STATEMENT. Borrower hereby authorizes Agent to file
a copy of this Agreement as a Financing Statement under the Uniform Commercial
Code with appropriate county and state government authorities necessary to
perfect the Agent's security interest in the Collateral as set forth herein.
4.4. NOTICES. Any notices under or pursuant to this agreement
will be deemed duly sent when delivered in hand or when mailed by registered or
certified mail, return receipt requested, to the addresses then provided for in
the Notices section of the Credit Agreement.
4.5. GOVERNING LAW; JURISDICTION. This Agreement will be governed
by the domestic laws of the State of Ohio. Borrower agrees that the state and
federal courts in Xxxxxxxx County, Ohio or any other court in which Agent
initiates proceedings relating to any Collateral have exclusive jurisdiction
over all matters arising out of this Agreement, and that service of process in
any such proceeding will be effective if mailed to Borrower at its address
described in the Notices section of the Credit Agreement. AGENT AND BORROWER
HEREBY WAIVE THE RIGHT TO TRIAL BY JURY OF ANY MATTERS ARISING OUT OF THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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IN WITNESS WHEREOF, Borrower and Agent have executed this Security
Agreement by their duly authorized officers as of the date first above
written.
WARNING - BY SIGNING THIS PAPER, YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME, A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER
FOR RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE
AGREEMENT OR ANY OTHER CAUSE.
THE O'GARA COMPANY
By: ____________________________________
Its: ____________________________________
THE FIFTH THIRD BANK, AS AGENT
By: ____________________________________
Its: ____________________________________
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SCHEDULE I
SPECIFIC REPRESENTATIONS
------------------------
1. The exact legal name of Borrower is:__________________________________
2. If Borrower has changed its name since it was incorporated, its past
legal names were:_____________________________________________________
______________________________________________________________________
3. Borrower uses in its business and owns the following trade names:_____
______________________________________________________________________
4. Borrower was incorporated on , under the laws of the State of_________
____________________ , and is in good standing under those laws.
5. Borrower is qualified to transact business in the following states:
______________________________________________________________________
6. Borrower has its chief executive office and principal place of business
at____________________________________________________________________.
Borrower maintains all of its records with respect to its Accounts at
that address.
7. Borrower also has places of business at_______________________________
______________________________________________________________________
8. No inventory, equipment or fixtures owned by Borrower are located at
any other place, nor were they located at any other place within the
past four months. The locations noted in #7 above.
9. In the past five years Borrower has never maintained its chief
executive office or principal place of business or records with
respect to accounts, nor owned personal property, at any locations
except those set forth above and except________________________________
_______________________________________________________________________
10. The following entities (a) have been merged into Borrower, (b) have
sold substantially all of their assets to Borrower outside the
ordinary course of their business since Borrower was incorporated:
______________________________________________________________________
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11. Borrower is not the owner or licensee of any registered patents,
trademarks or copyrights except:______________________________________
______________________________________________________________________
12. Borrower does not have any subsidiaries, or own stock in any other
corporations, or own an interest in any partnerships or joint ventures,
except________________________________________________________________
______________________________________________________________________
13. Borrower is not the owner of any life insurance policies except
______________________________________________________________________
14. If Borrower is incorporated in Kentucky or qualified to do business
there, its registered agent and registered office there as listed on
the Kentucky secretary of state's corporate records are:______________
______________________________________________________________________
15. Borrower is not a plaintiff or defendant in any litigation except as
follows:______________________________________________________________
______________________________________________________________________
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EXHIBIT A
to
UCC-1 FINANCING STATEMENT
-------------------------
[Form for Parent - Similar Document for Each Other Borrower]
DEBTOR: SECURED PARTY:
The O'Gara Company The Fifth Third Bank, as agent
0000 Xx Xxxxx Xxxxx 00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxx 00000 Xxxxxxxxxx, Xxxx 00000
This UCC-1 Financing Statement covers the following property of
Debtor whether now owned or existing or hereafter acquired or arising
regardless of where it is located (collectively referred to herein as
the"Collateral"):
1. all accounts, accounts receivable, contract rights, instruments,
documents, chattel paper, and all obligations in any form including
but not limited to those arising out of the sale or lease of goods or
the rendition of services by Debtor; all guaranties, letters of
credit and other security for any of the above; all merchandise
returned to or reclaimed by Debtor; and all books and records
(including computer programs, tapes and data processing software)
evidencing an interest in or relating to the above.
2. all equipment, machinery, machine tools, fixtures, office equipment,
furniture, furnishings, motors, motor vehicles, tools, dies, parts,
jigs, goods (including, without limitation, each of the items of
equipment set forth on any schedule which is either now or in the
future attached to Secured Party's copy of this Agreement), and all
attachments, accessories, accessions, replacements, substitutions,
additions and improvements thereto, and all supplies used or useful
in connection therewith.
3. all general intangibles, choses in action, causes of action,
obligations or indebtedness owed to Debtor from any source
whatsoever, and all other intangible personal property of every kind
and nature (other than Accounts) including without limitation
patents, trademarks, trade names, service marks, copyrights and
applications for any of the above, and goodwill, trade secrets,
licenses, franchises, rights under agreements, tax refund claims, and
all books and records including all computer programs, disks, tapes,
printouts, customer lists, credit files and other business and
financial records, and the equipment containing any such information.
4. all inventory, goods, supplies, wares, merchandises and other
tangible personal property, including raw materials, work in process,
supplies and components, and finished goods, whether held for sale or
lease, or furnished or to be furnished under any contract for
service, and also including products of and accessions to inventory,
packing and shipping materials, and all documents of title, whether
negotiable or non-negotiable, representing any of the foregoing.
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5. all proceeds and products of the Collateral and all additions and
accessions to, replacements of, insurance or condemnation proceeds
of, and documents covering Collateral, all tort or other claims
against third parties arising out of damage or destruction of
Collateral, all property received wholly or partly in trade or
exchange for Collateral, all fixtures, all leases of Collateral and
all rents, revenues, issues, profits and proceeds arising from the
sale, lease, license, encumbrance, collection, or any other temporary
or permanent disposition, of the Collateral or any interest therein.
6. all instruments, chattel paper, documents, securities, money, cash,
letters of credit, warrants, dividends, distributions, contracts,
agreements, contract rights or other property, owned by Debtor or in
which Debtor has an interest, including but not limited to, those which
now are or at any time hereafter will be in the possession or control
of Secured Party or in transit by mail or carrier to or in the
possession of any third party acting on behalf of Secured Party,
without regard to whether Secured Party received the same in pledge,
for safekeeping, as agent for collection or transmission or otherwise
or whether Secured Party had conditionally released the same, and the
proceeds thereof, all rights to payment from, and all claims against
Secured Party, and any deposit accounts of Debtor with Secured Party,
including all demand, time, savings, passbook or other accounts and all
deposits therein.
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