SECOND AMENDMENT
TO
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
Reference is hereby made to the Amended and Restated Revolving Credit
Agreement, dated as of December 31, 1998, by and among Dynamics Research
Corporation, a Massachusetts corporation ("DRC"), DRC Encoder, Inc., a
Massachusetts corporation, DRC Metrigraphics, Inc., a Massachusetts
corporation, DRC Software, Inc., a Massachusetts corporation, DRC Telecom,
Inc., a Massachusetts corporation, and Xxxxx Brothers Xxxxxxxx & Co., a New
York limited partnership, as a Lender, as Agent for itself and the other
Lenders, and as Swing Line Lender, BankBoston, N.A., a national banking
association, The Chase Manhattan Bank, a New York banking corporation,
State Street Bank and Trust Company, a Massachusetts trust company,
Citizens Bank of Massachusetts, a Massachusetts financial institution, and
the other Lenders from time to time party thereto, as amended by the First
Amendment to Amended and Restated Revolving Credit Agreement, dated as of
December 31, 1998, by and among the foregoing parties (such Credit
Agreement, as so amended, is referred to herein as the "Credit
Agreement"). The parties to the Credit Agreement now desire to amend the
Credit Agreement, pursuant to 25 thereof, as set forth in this Second
Amendment, dated as of May 10, 1999 (the "Amendment"), and hereby agree as
follows:
I. EFFECTIVE DATE; DEFINITIONS.
Subject to the terms of Article III hereof, this Amendment shall be
effective as of the date hereof (the "Effective Date"). Capitalized terms
used herein but not defined herein shall have the meanings assigned thereto
in the Credit Agreement, as amended hereby.
II. AMENDMENTS.
A. 1.1 of the Credit Agreement is hereby amended by inserting the
following definitions in the appropriate alphabetical order:
Default Rate. The meaning specified in 4.9.
Evergreen Letter of Credit. Any Letter of Credit providing for
automatic extensions of its expiry date unless the Issuing Bank shall have
provided some notice or taken other specified action to preclude any such
further extension.
Governmental Authority. Any federal, state or local government
or political subdivision of any of the foregoing, any central
bank (or other monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government, and any corporation or other
entity owned or controlled, through capital stock or otherwise, by any of
the foregoing.
Honor Date. The meaning specified in 3.3(a).
Indemnitee. The meaning specified in 15.
Issue. With respect to any Letter of Credit, either to issue,
or to extend the expiry of, or to renew, or to increase the amount of, such
Letter of Credit; and the terms Issued and Issuance shall have corresponding
meanings.
Issuing Bank. BBH&Co or any Affiliate of BBH&Co that may from
time to time Issue Letters of Credit for the account of any Borrower, or
any substitute Issuing Bank appointed in accordance herewith.
L/C Obligations. With respect to any Person, obligations of
such Person with respect to undrawn letters of credit or unpaid bankers'
guarantees or similar items.
Letter of Credit. Any letter of credit (whether a standby
letter of credit or a commercial documentary letter of credit),
in form satisfactory to the Issuing Bank, which is at any time Issued
by the Issuing Bank pursuant to 3 hereof, in each case as amended,
supplemented or otherwise modified from time to time.
Letter of Credit Liability. As of any date of determination,
all then-existing liabilities of the Borrowers to the Issuing
Bank in respect of the Letters of Credit Issued for the account of
any and all of the Borrowers, whether such liability is contingent or
fixed, and shall, in each case, consist of the sum of (i) the
aggregate maximum amount then available to be drawn under such
Letters of Credit (the determination of such maximum amount to assume
compliance with all conditions for drawing) and (ii) the aggregate
amount which has then been paid by, and not been reimbursed to, the
Issuing Bank under such Letters of Credit.
Letter of Credit Termination Date. The Maturity Date.
B. 1.1 of the Credit Agreement is hereby further amended as follows:
1. The definition of Available Total Commitment shall be deleted in
its entirety and replaced with the following: "The Total Commitment less
the sum of (i) the Outstanding Loans and (ii) all Letter of Credit
Liability."
2. In the definition of Loan Documents, the phrase ", the Letters
of Credit and any application agreement executed in connection therewith,"
shall be inserted immediately prior to the phrase "and any other document"
appearing therein.
3. In the definition of Required Lenders, the phrase "plus the
total liabilities under any Letters of Credit" shall be inserted
immediately prior to the phrase "or, if no amounts are Outstanding"
appearing therein, and the phrase "and no Letters of Credit have been
issued hereunder" shall be inserted immediately prior to the phrase ", of
the Percentages of the Total Commitment" appearing therein.
C. The Credit Agreement is hereby further amended by (1) deleting
the heading "3. PREPAYMENT OF THE LOANS; RESERVES." appearing
immediately following 2.9 thereof, (2) deleting the reference to "3.1"
appearing immediately prior to the heading "Voluntary Prepayments." and
inserting "2.10" in lieu thereof and (3) deleting the reference to
"3.2" appearing immediately prior to the heading "Mandatory
Prepayments." and inserting "2.11" in lieu thereof.
D. The Credit Agreement is hereby amended by inserting the following
text immediately prior to 4 thereof:
3. AMOUNT AND TERMS OF LETTERS OF CREDIT.
3.1. Letters of Credit. The Issuing Bank agrees, on the
terms and conditions hereinafter set forth, to Issue for the
account of one or more of the Borrowers, one or more Letters of
Credit denominated in Dollars from time to time during the period
from the Closing Date until the Maturity Date in an aggregate undrawn
amount not to exceed at any time $5,000,000, each such Letter of
Credit upon its Issuance to expire on or before the earlier of (x)
the date which occurs one year from the date of its Issuance or (y)
thirty days prior to the Maturity Date; provided, however, that the
Issuing Bank shall not be obligated (or permitted) to Issue any
Letter of Credit if:
(a) after giving effect to the Issuance of such Letter
of Credit, the sum of (i) the Outstanding Loans and (ii) the
Outstanding Letter of Credit Liability shall exceed the Available
Total Commitment;
(b) the Agent or the Required Lenders shall have notified the Issuing Bank
and the Borrowers that no further Letters of Credit are to be Issued by the
Issuing Bank due to a continuing failure to meet any of the applicable
conditions set forth in 10 or 11, and such notice has not expired or
been withdrawn by the Agent or the Required Lenders;
(c) any order, judgment or decrees of any Governmental Authority or
arbitration shall by its terms purport to enjoin or restrain the Issuing
Bank from issuing such Letter of Credit, or any requirement of law or
regulation applicable to the Issuing Bank or any request or directive
(whether or not having the force of law) from any Governmental Authority
with jurisdiction over the Issuing Bank shall prohibit, or request that the
Issuing Bank refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon the Issuing Bank
with respect to such Letter of Credit any restriction, reserve or capital
requirement (for which the Issuing Bank is not otherwise compensated) not in
effect on the Closing Date and which results in an unreimbursed loss,
cost or expense or shall otherwise impose upon the Issuing Bank any
unreimbursed loss, cost or expense which was not applicable on the
Closing Date;
(d) any requested Letter of Credit does not provide for
drafts, or is not otherwise in form and substance acceptable to
the Issuing Bank; or
(e) any Letter of Credit is for the purpose of supporting the issuance of
any letter of credit by any Person other than the Issuing Bank.
Within the limits of the obligations of the Issuing Bank set
forth above, the Borrowers may request the Issuing Bank to Issue one
or more Letters of Credit, reimburse the Issuing Bank for payments
made thereunder pursuant to 3.3(a), and request the Issuing Bank to
Issue one or more additional Letters of Credit under 3.1.
3.2. Issuing the Letters of Credit.
(a) Each standby or commercial documentary Letter of
Credit shall be Issued on at least four Business Days' notice, in
each case from the applicable Borrower to the Issuing Bank,
specifying the date, amount, expiry and beneficiary thereof, and
whether such Letter of Credit is to be a standby or commercial
documentary Letter of Credit, accompanied by such application and
agreement for letter of credit as the Issuing Bank may from time to
time specify to such Borrower, each in form and substance
satisfactory to the Issuing Bank. On the date specified by the
applicable Borrower in such notice and upon fulfillment of the
applicable conditions set forth in 3.1, 10 and 11 hereof, the
Issuing Bank will Issue such Letter of Credit in the form specified
in such notice and such application and agreement for letter of
credit and will promptly notify the Agent thereof.
(b) The Borrowers each acknowledge and agree that the
Issuing Bank may, in connection with any Evergreen Letter of
Credit, at its election (or as required by the Agent at the direction
of the Required Lenders) deliver any notices of termination or other
communications to any Letter of Credit beneficiary or transferee, or
take any other action as necessary or appropriate, in order to cause
the expiry date of such Letter of Credit to be a date not later than
the Maturity Date.
3.3. Reimbursement Obligations.
(a) Notwithstanding any provisions to the contrary in
any application and agreement for letter of credit applicable to
any Letter of Credit, each Borrower requesting a Letter of Credit
shall:
(i) on the date of any payment by the Issuing Bank
on the Letter of Credit (the "Honor Date") pay to the Issuing
Bank an amount equal to, and in reimbursement for, each amount which
the Issuing Bank pays under any such Letter of Credit; and
(ii) pay to the Issuing Bank interest on any
amount remaining unpaid under clause (i) above from the Honor
Date until such amount is reimbursed in full to the Issuing Bank
pursuant to clause (i) above, payable on demand, at a fluctuating
rate per annum equal to the Default Rate in effect from time to time.
(b) All amounts to be reimbursed to the Issuing Bank in
accordance with subsection (a) above may, subject to the
limitations set forth in 2, be paid from the proceeds of Revolving
Credit Loans or Swing Line Loans, and, solely for such purposes, the
minimum borrowing amount limitations set forth in 2.7 shall not be
applicable. The Borrowers hereby authorize the Lenders to make
Revolving Credit Loans and the Swing Line Lender to make Swing Line
Loans, in each case which are in the amounts of the reimbursement
obligations of the applicable Borrowers set forth in subsection (a)
above, and further authorize (without creating any obligation so to
do) the Agent (i) to give the Lenders, pursuant to 2.7, a Loan
Request with respect to any Revolving Credit Loans (which shall be
Base Rate Loans), (ii) to give the Swing Line Lender, pursuant to
2.7, a Loan Request, with respect to any Swing Line Loans and (iii)
to distribute the proceeds of such Loans to the Issuing Bank to pay
such amounts. The Borrowers each agree that all such Advances so
made shall be deemed to have been requested by them, respectively,
and direct that all proceeds thereof shall be used to pay such
reimbursement obligations under subsection (a) above.
3.4. Participations Purchased by the Lenders.
(a) On the date of Issuance of each Letter of Credit,
the Issuing Bank shall be deemed irrevocably and unconditionally
to have sold and transferred to each Lender without recourse or
warranty, and each Lender shall be deemed to have irrevocably and
unconditionally purchased and received from such Issuing Bank, an
undivided interest and participation, to the extent of such Lender's
Percentage, in effect from time to time, in such Letter of Credit and
all Letter of Credit Liability relating to such Letter of Credit and
all Loan Documents securing, guaranteeing, supporting or otherwise
benefiting the payment of such Letter of Credit Liability. Promptly
after the end of such calendar month, the Agent will notify each
Lender of the Letters of Credit Issued during the prior month and of
their dates of Issue, amounts, expiries and reference numbers.
(b) In the event that any reimbursement obligation under
3.3(a) is not paid when due to the Issuing Bank with respect to
any Letter of Credit, including by virtue of 3.3(b), the Issuing
Bank will promptly notify the Agent to that effect, and the Agent
will promptly notify the Lenders of the amount of such reimbursement
obligation and each Lender shall immediately pay to the Agent for the
account of the Issuing Bank, subject to subsection (e) of this
Section and in same day funds, an amount equal to such Lender's
Percentage then in effect of the amount of such unpaid reimbursement
obligation with interest at the Federal Funds Effective Rate for each
day after such notification until such amount is paid to the Agent.
(c) Promptly after the Issuing Bank receives a payment
on account of a reimbursement obligation with respect to any
Letter of Credit, the Issuing Bank shall promptly pay to the Agent,
and the Agent shall promptly pay to each Lender which funded its
participation therein, in the kind of funds so received, an amount
equal to such Lender's ratable share thereof.
(d) Upon the request of any Lender, the Agent will
furnish to such Lender copies of any Letter of Credit and any
application and agreement for Letter of Credit and other documents
related thereto as may be reasonably requested by such Lender.
(e) The obligation of each Lender to make payments as
and when required under subsection (b) above shall be unconditional
and irrevocable and shall be made under all circumstances, including,
without limitation, any of the circumstances referred to in 3.6(b).
(f) If any payment received on account of any reimbursement obligation
with respect to a Letter of Credit and distributed to a Lender as a
participant under 3.4(c) is thereafter recovered from the Issuing Bank in
connection with any bankruptcy, reorganization, insolvency, liquidation,
receivership, dissolution, winding-up, relief of debtors or general
assignment for the benefit of creditors that, in any such case, relates to
any Borrower, each Lender which received such distribution shall, upon
demand by the Agent, repay to the Issuing Bank such Lender's ratable share
of the amount so recovered together with an amount equal to such Lender's
ratable share (according to the proportion of (i) the amount of such
Lender's required repayment to (ii) the total amount as recovered) of
any interest or other amount paid or payable by the Issuing Bank in
respect of the total amount so recovered.
3.5. Letter of Credit Fees.
(a) Each Borrower hereby severally agrees to pay to each
Lender (in accordance with its Percentage) a letter of credit fee
with respect to each Letter of Credit on the maximum amount available
to be drawn under such Letter of Credit from time to time after
giving effect to scheduled reductions thereof (the determination of
such maximum amount to assume compliance with all conditions for
drawing) from the date of Issuance of such Letter of Credit until the
expiry date of such Letter of Credit at the rate per annum equal to
1.50%. Such fee shall be payable in arrears on the last Business Day
of each March, June, September and December in each year, commencing
June 30, 1999 through the Letter of Credit Termination Date, and on
the Letter of Credit Termination Date.
(b) Each Borrower hereby severally agrees to pay to the
Issuing Bank, for its own account, in addition to the fees
described in subsection (c) of this Section, an issuance fee for each
Letter of Credit Issued hereunder equal to $150.
(c) Each Borrower severally agrees to pay to the Issuing
Bank, for its own account and on demand, sums equal to standard
fees, charges and expenses that such Issuing Bank may impose, pay or
incur in connection with the Issuance, amendment, administration,
transfer or cancellation of any or all Letters of Credit issued for
the account of such Borrower or in connection with any payment by
such Issuing Bank thereunder. The Issuing Bank will give DRC notice
of any change in its standard fees, charges or expenses payable by
the Borrowers to the Issuing Bank pursuant to this 3.5(c); provided,
however, that any failure by the Issuing Bank to give such notice
shall not affect the Borrowers' obligations under this 3.5 to pay
the Issuing Bank's reasonable current standard fees, charges or
expenses in accordance herewith.
(d) All fees payable in respect of Letters of Credit shall be nonrefundable.
3.6. Indemnification; Nature of the Issuing Bank's Duties.
(a) The Borrowers agree to indemnify and save harmless
the Agent, the Issuing Bank and each Lender from and against any
and all claims, demands, liabilities, damages, losses, costs, charges
and expenses (including attorney fees and costs for external counsel
to the Lenders and the allocated costs and disbursements of internal
counsel of the Lenders) which the Agent, the Issuing Bank or such
Lender may incur or be subject to as a consequence, direct or
indirect, of (i) the Issuance of any Letter of Credit or (ii) any
action or proceeding relating to a court order, injunction, or other
process or decree restraining or seeking to restrain the Issuing Bank
from paying any amount under any Letter of Credit.
(b) The obligations of the Borrowers hereunder with respect to Letters of
Credit shall be unconditional and irrevocable, and shall be paid strictly in
accordance with the terms hereof under all circumstances, including,
without limitation, any of the following circumstances:
(i) any lack of validity or enforceability of any Letter of Credit or Loan
Document or any agreement or instrument relating thereto;
(ii) the existence of any claims, set off, defense or other right
which any Borrower may have at any time against the beneficiary, or any
transferee, of any Letter of Credit, or the Issuing Bank, the Agent, any
Lender, or any other Person;
(iii) any draft, certificate, or other document presented under any Letter
of Credit proving to be forged, fraudulent, invalid or insufficient in
any respect or any statement therein being untrue or inaccurate in any
respect;
(iv) any lack of validity, effectiveness, or sufficiency of any instrument
transferring or assigning or purporting to transfer or assign any
Letter of Credit or the rights or benefits thereunder or proceeds
thereof, in whole or in part;
(v) any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under any Letter of Credit
or of the proceeds thereof;
(vi) any failure of the beneficiary of a Letter of Credit to strictly
comply with the conditions required in order to draw upon any Letter
of Credit; or any payment is made by the Issuing Bank under any Letter
of Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or
any transferee of any Letter of Credit;
(vii) any misapplication by the beneficiary of any Letter of Credit of
the proceeds of any drawing under such Letter of Credit; or
(viii) any other circumstance or happening whatsoever, whether or
not similar to the foregoing; provided, however, that, notwithstanding the
foregoing, the Issuing Bank shall not be relieved of any liability it may
otherwise have as a result of its gross negligence or willful misconduct.
3.8. International Standby Practices. The International
Standby Practices ISP 98 most recently published by the International
Chamber of Commerce shall in all respects be deemed a part of this 3 as if
incorporated herein and shall apply to the Letters of Credit.
3.9. Substitute Issuing Bank. Upon the mutual agreement of
DRC, BBH&Co in its capacity as Issuing Bank and any other Lender, such
other Lender shall, with respect to any Letter of Credit hereunder, act as
Issuing Bank hereunder. If any such Lender shall so agree to act as
Issuing Bank as to such Letter of Credit, then that Lender in such capacity
shall be deemed for all purposes to be the Issuing Bank hereunder with
respect to such Letter of Credit and shall be entitled to all rights,
benefits and privileges and be subject to all obligations as if it were
appointed as Issuing Bank as of the date hereof. Notwithstanding the
foregoing, each of the Borrowers, the Lenders, the Agent and the Issuing
Bank acknowledge and agree that no Lender (other than BBH&Co in its
capacity as the Issuing Bank) shall have any obligation to serve as Issuing
Bank or to Issue Letters of Credit hereunder, and BBH&Co in its capacity as
Issuing Bank shall have no obligation to cause or arrange for any
replacement Issuing Bank.
E. 4.5 of the Credit Agreement is hereby amended as follows:
1. The phrase "with the administration" appearing in the fourth
line thereof is deleted and the phrase "responsible for the
administration" is inserted in lieu thereof;
2. "or" is inserted immediately following the end of paragraph (d)
thereof;
3. The following paragraph is inserted immediately following
paragraph (d):
"(e) (i) impose, modify or deem applicable to the Issuing
Bank or any Lender any reserve, special deposit or similar
requirement against letters of credit issued by the Issuing
Bank or (ii) impose on the Issuing Bank or any Lender any other
condition regarding letters of credit or, in the case of such
Lender, its participation hereunder in Letters of Credit;"
4. "or" is inserted immediately following the end of paragraph
(iii) thereof;
5. The following paragraph is inserted immediately following
paragraph (iii) thereof:
"(iv) increase the cost of the Issuing Bank of Issuing or
maintaining or, in the case of such Lender, having a
participation in Letters of Credit;";
6. The last paragraph thereof is deleted in its entirety and the
following paragraph is inserted in lieu thereof:
"then, and in each such case, the Borrower will, within ten (10)
Business Days following receipt of written notice from the Agent on
behalf of such Lender or the Issuing Bank, which written notice shall
include a description of the relevant change in law and calculations
of the amounts payable, pay to the Agent on behalf of such Lender or
the Issuing Bank, as the case may be, such additional amounts as will
be sufficient to compensate such Lender or the Issuing Bank, as the
case may be, for such additional cost, reduction, payment or foregone
interest or other sum."
F. 4.6 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
If (a) any change in any present law, governmental rule,
regulation, policy, guideline or directive or if any future law,
governmental rule, regulation, policy, guideline or directive (in
each case whether or not having the force of law, but only if it is
mandatory that any Lender or the Issuing Bank comply) or the
interpretation thereof by a court or governmental authority with
appropriate jurisdiction or any change in any such law or
interpretation (including, without limitation, any change according
to a prescribed schedule of increasing requirements, whether or not
known on the date of this Credit Agreement) affects the amount of
capital required or expected to be maintained by any Lender or any
Person controlling such Lender, or to be maintained by the Issuing
Bank or any Person controlling the Issuing Bank, and (b) such Lender
or the Issuing Bank (as the case may be) determines that the amount
of capital required to be maintained by it is increased by or based
upon (i) with respect to such Lender, the existence of the
Commitments or Loans made pursuant hereto or such Lender's
participation in (or commitment to participate in) any Letter of
Credit or (ii) with respect to the Issuing Bank, the Issuance of (or
commitment to Issue) any Letter of Credit, then, in any such case,
the Agent on behalf of such Lender or the Issuing Bank, as the case
may be, may notify the Borrower of such fact. Other than in a case
where the costs of such increased capital requirements are reflected
in the applicable rate(s) of interest on the Loans, the Borrower and
the Agent on behalf of such Lender or on behalf of the Issuing Bank
(as the case may be) shall thereafter attempt to negotiate in good
faith, within thirty (30) days of the day on which the Borrower
receives such notice, an adjustment payable hereunder that will
adequately compensate such Lender or the Issuing Bank, as the case
may be, in light of these circumstances. If the Borrower and the
Agent on behalf of such Lender or on behalf of the Issuing Bank (as
the case may be) are unable to agree to such adjustment within thirty
(30) days of the date on which the Borrower receives such notice,
then commencing on the date Borrower received such notice (but not
earlier than the effective date of any such increased capital
requirement), from time to time the Borrower will pay to the Agent,
on behalf of such Lender or on behalf of the Issuing Bank (as the
case may be) after consultation with the affected Lender or the
Issuing Bank, as applicable, such additional amount that will, in the
Agent's reasonable determination, provide adequate compensation to
such Lender or the Issuing Bank (as the case may be). Such Lender or
the Issuing Bank (as the case may be) shall allocate such cost
increases among its customers in good faith and on an equitable
basis.
G. 4.7 of the Credit Agreement is hereby amended by inserting the
phrase "or the Issuing Bank (as the case may be)" immediately following
the phrase "on behalf of any Lender" appearing in the penultimate line
thereof.
H. 4.8 of the Credit Agreement is hereby amended by (1) deleting
"Lender" in each of the three places that it appears in the first two
lines thereof and inserting "Indemnitee" in lieu thereof and (2) inserting
the phrase ", or of any Letter of Credit Liability," immediately following
the phrase "interest on any Loans appearing in clause (a) thereof.
I. 4.9 of the Credit Agreement is hereby amended by inserting
"(the "Default Rate")" immediately following the phrase "at a rate per
annum" appearing in the third line thereof.
J. 4.10 of the Credit Agreement is hereby amended by (1) inserting
the phrase "and the Issuing Bank" immediately following the phrase "Each
Lender" appearing in the first line thereof and (2) inserting the phrase
"or the Issuing Bank" (a) immediately following the phrase "not require
such Lender" appearing in the second line thereof, (b) immediately
following the phrase "to such Lender" appearing in the sixth line thereof
and (c) immediately following the phrase "by any Lender" appearing in the
penultimate line thereof.
K. 4.11 of the Credit Agreement is hereby amended by inserting the
phrase "and regardless of whether a Letter of Credit was Issued for the
account of any Borrower" immediately following the phrase "the proceeds of
a Loan" appearing in clause (i) thereof.
L. 1. Each of 6 and 7 of the Credit Agreement is hereby
amended by deleting the text of the introductory paragraph of each such
section in its entirety and inserting in lieu thereof the following:
"Each Borrower covenants and agrees that, so long as any Loan
or Note is Outstanding or any Letter of Credit Liability shall
exist or the Lenders have any obligation to make Loans hereunder or
the Issuing Bank has any obligation to Issue Letters of Credit
hereunder:"
2. 8 of the Credit Agreement is hereby amended by deleting
the text of the introductory paragraph of such section in its entirety and
inserting in lieu thereof the following:
"Each Borrower covenants and agrees that, so long as any Loan
or Note is Outstanding or any Letter of Credit Liability shall exist
or the Lenders have any Available Total Commitment or any obligation
to make Loans hereunder or the Issuing Bank has any obligation to
Issue Letters of Credit hereunder, DRC and its Subsidiaries shall
maintain at all times, on a Consolidated basis, each of the
following:"
M. 9.1(a) of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
"Any Borrower shall default in the payment of principal of or
interest on any Note or any amount with respect to any Letter of
Credit or any other fee or other amount due hereunder or under any
other Loan Document, whether at maturity or at a date fixed for the
payment thereof or at a date fixed for any installment or prepayment
thereof or otherwise, and in the case of any such fee payment
default, such default shall continue for a period of three (3)
Business Days following the date of such default; or"
N. The last paragraph of 9.1 of the Credit Agreement is hereby
amended by deleting the text thereof in its entirety and inserting the
following in lieu thereof:
then, and in any such event, and at any time thereafter, if any
Event of Default (other than an event described in 9(f) or 9(g)
shall then be continuing, the Agent shall at the request, or may with
the consent, of the Required Lenders (i) declare the principal of and
accrued interest in respect of the Notes to be forthwith due and
payable, whereupon the principal of and accrued interest in respect
of the Notes, and all other amounts then due hereunder, shall become
forthwith due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby expressly waived by
each Borrower, and/or (ii) terminate the Total Commitment, whereupon
the Total Commitment of the Lenders (and the Commitment of each
individual Lender) to make Loans hereunder, and the obligation of the
Issuing Bank to Issue Letters of Credit, shall forthwith terminate
without any other notice of any kind; and with respect to any event
described in 9(f) or 9(g) above, the Commitments shall
automatically terminate and the principal of the Notes then
outstanding, together with accrued interest thereon and all other
amounts then due hereunder or under any other Loan Document shall
automatically become due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby
expressly waived by each of the Borrowers, anything contained herein
or in any other Loan Document to the contrary notwithstanding.
O. 9.2 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
In case any one or more Events of Default shall occur and be
continuing, the Lenders and the Issuing Bank may proceed to protect and
enforce their rights by an action at law, suit in equity or other
appropriate proceeding, whether for the specific performance of any
agreement contained herein or in any other Loan Document, or for an
injunction against a violation of any of the terms hereof or thereof, or in
aid of the exercise of any power granted hereby or thereby or by law. In
case of a default in the payment of any principal of or interest on any
Note, or in the payment of any Letter of Credit Liability or fee due
hereunder or under any other Loan Document, each Borrower will pay to the
Lenders or the Issuing Bank, as the case may be, such further amounts as
shall be sufficient to cover the cost and expense of collection, including
the Lenders' and the Issuing Bank's attorneys' fees, expenses and
disbursements. No course of dealing and no delay on the part of the
Lenders or the Issuing Bank in exercising any right shall operate as a
waiver thereof or otherwise prejudice the Lenders' or the Issuing Bank's
rights. No right conferred hereby or by any other Loan Document upon the
Lenders or the Issuing Bank shall be exclusive of any other right referred
to herein or therein or now or hereafter available at law, in equity, by
statute or otherwise.
P. 11 of the Credit Agreement is hereby amended as follows:
1. The phrase "and the obligation of the Issuing Bank to Issue any
Letter of Credit" shall be inserted immediately following the phrase "The
obligations of the Lenders to make any Loan" appearing in the introductory
paragraph thereof.
2. The phrase "and to the Issuance of any Letter of Credit (as the
case may be)" shall be inserted immediately following the phrase "such
Drawdown Date" appearing in the second line of 11.1.
3. The phrase "and as of the time of Issuance of such Letter of
Credit (as the case may be)" shall be inserted immediately following the
phrase "the making of such Loan" appearing in the sixth line of 11.1.
4. The last sentence of 11.1 shall be deleted in its entirety and
the following sentence shall be inserted in lieu thereof:
"On or before the date of the Loans and on or before the date
of Issuance of the Letters of Credit, the Agent, on behalf of the
Lenders and the Issuing Bank, shall have received a certificate of
DRC signed by the chief financial officer or treasurer of DRC to such
effect."
5. 11.2 shall be amended by deleting the text thereof in its
entirety and inserting the following in lieu thereof:
"No change shall have occurred in any law or regulations thereunder
or interpretations thereof that (a) in the reasonable opinion of any
Lender would make it illegal for such Lender to make such Loan or (b)
in the reasonable opinion of the Issuing Bank would make it illegal
for the Issuing Bank to Issue the Letter of Credit."
Q. 12 of the Credit Agreement is hereby amended as follows:
1. The heading of 12 shall be deleted and the phrase "THE AGENT
AND THE ISSUING BANK" shall be inserted in lieu thereof.
2. 12.1 shall be amended by deleting the text of the first two
lines thereof and inserting the following in lieu thereof:
"Each Lender and the Issuing Bank hereby irrevocably appoints
and authorizes BBH&Co to act as its agent hereunder and under each of the
Loan Documents".
3. 12.1 shall be amended by adding the following paragraph at the
end thereof:
The Issuing Bank shall act on behalf of the Lenders with
respect to any Letters of Credit Issued by it and the documents
associated therewith until such time and except for so long as the
Agent may agree at the request of the Required Lenders to act for
such Issuing Bank with respect thereto; provided, however, that the
Issuing Bank shall have all of the benefits and immunities (i)
provided to the Agent in this 12 with respect to any acts taken or
omission suffered by the Issuing Bank in connection with Letters of
Credit Issued by it or proposed to be Issued by it and the
application and agreements for letters of credit pertaining thereto
as fully as if the term "Agent", as used in this 12, included the
Issuing Bank with respect to such acts or omissions, and (ii)
additionally provided in this Credit Agreement with respect to the
Issuing Bank.
4. 12.4 shall be amended by (a) adding the phrase "and the
participations in Letter of Credit Liability purchased by it" immediately
following the phrase "the Loans made by it" in the second line thereof and
(b) inserting the phrase ", issue letters of credit for the account of,"
immediately following the phrase "lend money to" appearing in the sixth
line thereof.
R. 13 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
Regardless of the adequacy of any collateral, during the
continuance of any Event of Default, any deposits or other sums
credited by or due from any Lender, the Agent or the Issuing Bank to
any Borrower and any securities or other property of any Borrower in
the possession of any Lender, the Agent or the Issuing Bank may be
applied to or set off against the pro rata payment of Obligations and
any and all other liabilities, direct, or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising,
of the Borrowers to the Lenders, the Agent or the Issuing Bank. The
Lenders agree among themselves that, with respect to all sums
received by the Lenders applicable to the payment of principal of or
interest on the Notes or of amounts relating to Letter of Credit
Liability, equitable adjustment will be made among the Lenders so
that, in effect, all such sums shall be shared ratably by each of the
Lenders whether received by voluntary payment, by the exercise of the
right of setoff or banker's lien, by counterclaim or crossclaim or by
the enforcement of any or all of the Notes or the other Loan
Documents. If any Lender receives any payment on its Notes, or with
respect to its participation in Letter of Credit Liability, of a sum
or sums in excess of its Percentage, then such Lender receiving such
excess payment shall purchase for cash from the other Lenders an
interest in their Notes, or (as the case may be) an interest in their
participation in all Letter of Credit Liability, in such amounts as
shall result in a ratable participation by each of the Lenders in the
aggregate unpaid amount of the Notes then outstanding or (as the case
may be) all Letter of Credit Liability; provided, however, that if
all or any portion of such excess payment is thereafter recovered
from such Lender, the purchase shall be rescinded and the purchase
price restored to the extent of such recovery, but without interest.
S. 14 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
Whether or not the transactions contemplated hereby shall be
consummated, each Borrower agrees to pay (a) the reasonable
direct, out-of-pocket costs of reproducing this Credit Agreement, the
other Loan Documents and the other agreements and instruments
mentioned herein, (b) any taxes (including any interest and penalties
in respect thereto) payable by the Lenders or the Issuing Bank (other
than taxes based upon the Lender's or the Issuing Bank's net income)
on or with respect to the transactions contemplated by this Credit
Agreement (and the Borrowers hereby agreeing to indemnify the Lenders
and the Issuing Bank with respect thereto), (c) the fees, expenses
and disbursements of the Agent's counsel incurred in connection with
the preparation of the Loan Documents and other instruments mentioned
herein and the reasonable fees, expenses and disbursements of the
Agent's counsel and any local counsel to the Lenders and to the
Issuing Bank in connection with any amendments, modifications,
approvals, consents, waivers or Replacement Lenders hereto or
hereunder and (d) all reasonable out-of-pocket expenses (including
attorney fees and costs for external counsel to the Lenders and to
the Issuing Bank and the allocated costs and disbursements of
internal counsel of the Lenders and the Issuing Bank) incurred by the
Lenders and the Issuing Bank in connection with (i) the enforcement
of or preservation of rights under any of the Loan Documents against
the Borrowers or the administration thereof after the occurrence of
an Event of Default or any event which, with the giving of notice or
passage of time or both, would constitute an Event of Default, (ii)
any replacement of a Lender pursuant to 17.4 or the substitution of
any Issuing Bank pursuant to 3.9 and (iii) any litigation,
proceeding or dispute arising hereunder; provided, however, that the
Borrowers shall have no obligation to pay for the expenses of the
Agent or the Lenders or the Issuing Bank to the extent such expenses
result from the Agent's or any Lender's or the Issuing Bank's gross
negligence, fraud or willful misconduct. In addition to the
foregoing, if any reimbursement obligation is not satisfied on the
applicable Honor Date, then the Borrowers shall, upon demand by any
Lender (with a copy of such demand to the Agent), pay to the Agent
for the account of such Lender any amounts required to compensate
such Lender for any additional losses, costs or expenses which it may
reasonably incur as a result of such failure, including, without
limitation, any reasonable direct loss, cost or out-of-pocket expense
incurred by reason of the liquidation or re-deployment of deposits or
other funds acquired by a Lender to fund or maintain such Letter of
Credit participation.
T. 15 of the Credit Agreement is hereby amended as follows:
1. The following phrase shall be inserted immediately prior to the
phrase "from and against any and all claims," appearing in the second line
thereof:
", the Agent, the Issuing Bank and their respective Affiliates and
the directors, officers, employees, attorneys and agents of any
Lender, the Agent, the Issuing Bank or such Affiliate (each of the
foregoing is referred to herein as an "Indemnitee")".
2. Each reference in the proviso to "the Agent or the Lenders" or
"the Agent or any Lender" shall be deleted and the phrase "an
Indemnitee" shall be inserted in lieu thereof; and the phrase "the Agent's
or any Lender's gross negligence" appearing in the proviso shall be
amended by deleting such phrase and inserting in lieu thereof the phrase
"an Indemnitee's gross negligence".
U. 16 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
All covenants, agreements, representations and warranties made
herein in any of the other Loan Documents or in any documents or
other papers delivered by or on behalf of each Borrower pursuant
hereto shall be deemed to have been relied upon by each Lender and
the Issuing Bank, notwithstanding any investigation heretofore or
hereafter made by it, and shall survive the making by the Lenders of
the Loans and the Issuance of the Letters of Credit, as herein
contemplated, and shall continue in full force and effect so long as
any amount due under this Credit Agreement or any of the other Loan
Documents remains outstanding or the Lenders have any obligation to
make any Loans or the Issuing bank has any obligation to issue any
Letters of Credit. All statements contained in any certificate or
other paper delivered to the Lenders or to the Issuing Bank at any
time by or on behalf of any Borrower pursuant hereto shall constitute
representations and warranties as of the date thereof by the
Borrowers hereunder.
V. 17 of the Credit Agreement is hereby amended as follows:
1. The phrase "or in any Letter of Credit Liability" shall be
inserted immediately following the phrase "grant an interest in any Loan"
appearing in the first proviso of 17.1.
2. 17.3 shall be amended by deleting the text thereof in its
entirety and inserting the following in lieu thereof:
Any Lender may, without the consent of any Borrower, the Agent or any
other Lender, sell participations to one or more banks or other
entities (each a "Participant") in all or a portion of such Lender's
rights and obligations under this Credit Agreement (including all or
a portion of its Commitment, the Loans owing to it and its portion of
all Letter of Credit Liability); provided, however, that (i) such
Lender's obligations under this Credit Agreement shall remain
unchanged, (ii) such Lender shall remain solely responsible to the
other parties hereto for the performance of such obligations, (iii)
each Borrower, the Agent, the Issuing Bank and the other Lenders
shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Credit Agreement and (iv) such participation shall be in an amount of
not less than $5,000,000. Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Credit Agreement
and to approve any amendment, modification or waiver of any provision
of this Credit Agreement. Each Borrower agrees that each Participant
shall be entitled to the benefits of 3.6, 3.7, 4.5, 4.8 and 15 to
the same extent as if it were a Lender and had acquired its interest
by assignment pursuant to 17.1.
W. 19(b) of the Credit Agreement is hereby amended by inserting the
phrase "or in its capacity as Issuing Bank" immediately following the
phrase "in its capacity as a Lender" in the first line thereof.
X. Each of 20 and 24 of the Credit Agreement is hereby amended by
inserting the phrase ", THE ISSUING BANK" immediately following each
reference to "THE AGENT" therein.
Y. 24 of the Credit Agreement is further amended by (1) deleting
the phrase "ANY LENDER. EACH BORROWER" appearing in the eighth line
thereof and inserting the phrase "ANY LENDER, EACH BORROWER" in lieu
thereof and (2) inserting the phrase "THE AGENT, THE ISSUING BANK AND"
immediately prior to the phrase "THE LENDERS HAVE BEEN INDUCED" appearing
in clause (B) thereof.
Z. 25 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
Except as otherwise expressly provided in this Credit Agreement, any
consent or approval required or permitted by this Credit Agreement to
be given by the Lenders, the Issuing Bank or the Agent may be given,
and any term of this Credit Agreement or of any other instrument
related hereto or mentioned herein may be amended, and the
performance or observance by any Borrower of any terms of this Credit
Agreement or such other instrument or the continuance of any Default
or Event of Default may be waived (either generally or in a
particular instance and either retroactively or prospectively) with,
but only with, the written consent of DRC and the written consent of
the Required Lenders. Notwithstanding the foregoing, no amendment or
waiver shall, without the prior written consent of the Agent, the
Issuing Bank and all of the Lenders, (a) extend the fixed maturity or
reduce the principal amount of, or reduce the rate or extend the time
of payment of or interest on, or reduce the amount or extend the time
of payment of any principal or interest of, any Note or any Letter of
Credit Liability (including any extensions of the Maturity Date
pursuant to 2.4); (b) change or waive the Total Commitment (other
than reductions in the Total Commitments pursuant to 2.3) or
Percentage; (c) amend or waive this 25 or amend or waive the
definition of Required Lenders; (d) change or waive the amount or
payment terms of any fees due hereunder; or (e) amend or waive 8(c)
or 9.1(a), (f) or (g) or 11. No waiver shall extend to or affect
any obligation not expressly waived nor impair any right consequent
thereon. No course of dealing or delay or omission on the part of
the Lenders, the Agent or the Issuing Bank in exercising any right
shall operate as a waiver thereof or otherwise be prejudicial
thereto. No notice to or demand upon a Borrower shall entitle a
Borrower to other or further notice or demand in similar or other
circumstances. In addition, no amendment, waiver, consent or
approval with respect to any Loan Document shall, unless in writing
and signed by the Agent, the Swing Line Lender or the Issuing Bank
(in addition to the Lenders required above to take such action),
affect the rights or duties of the Agent, the Swing Line Lender or
the Issuing Bank, respectively, under this Credit Agreement or any
other Loan Document.
AA. 26 of the Credit Agreement is hereby amended by deleting the
text thereof in its entirety and inserting the following in lieu thereof:
Each Lender, the Issuing Bank and the Agent agrees that it will not
make any disclosure of confidential information furnished to it by
any Borrower or any of its Subsidiaries unless such information shall
have become public, except:
(a) in connection with operations under or the enforcement of or the
protection of a Lender's, the Issuing Bank's, or the Agent's interest in
this Credit Agreement or any other Loan Document to Persons who have a
reasonable need to be furnished such information;
(b) pursuant to any law, rule or statutory or regulatory
requirement or any court order, subpoena or other legal process;
(c) to any parent or corporate Affiliate of such Lender
or of the Issuing Bank or of the Agent or to any Participant,
proposed Participant, assignee, proposed assignee, Replacement Lender
or proposed Replacement Lender; provided, however, that any such
Person shall agree to comply with the restrictions set forth in this
26 with respect to such information;
(d) to its directors, officers, employees, agents,
independent counsel, auditors and other professional advisors and
consultants with an instruction to such Person to keep such
information confidential;
(e) to any other Lender and to the Agent and the Issuing
Bank and any successor Agent or Issuing Bank or prospective successor
Agent or Issuing Bank; and
(f) with the prior written consent of the Borrower, to any other Person.
BB. 28 of the Credit Agreement is hereby amended by inserting the
phrase ", and to participate in the Letters of Credit and Letter of Credit
Liability," immediately following the phrase "to make their respective
Loans".
III. CONDITIONS; NO DEFAULT; REPRESENTATIONS AND WARRANTIES, ETC.
Each Borrower hereby represents and warrants to the Lenders that all
of the conditions of lending specified in 11 of the Credit Agreement and
Section III of this Amendment have been satisfied in all material respects
as of the Effective Date. Without limiting the generality of the
foregoing, each Borrower hereby confirms that: (i) the representations and
warranties of the Borrowers contained in 5 of the Credit Agreement, as
amended by and through this Amendment, are true on and as of the Effective
Date as if made on such date (except to the extent that such
representations and warranties expressly relate to an earlier date);
(ii) each Borrower is in compliance in all material respects with all of
the terms and provisions set forth in the Credit Agreement, as amended by
and through this Amendment, on its part to be observed or performed on or
prior to the Effective Date; and (iii) no Event of Default specified in 9
of the Credit Agreement, as amended by and through this Amendment, nor any
event which with the giving of notice or expiration of any applicable grace
period or both would constitute such an Event of Default has occurred and
is continuing. All fees and expenses of the Lenders, the Agent and the
Issuing Bank due and payable on the Effective Date shall be paid by the
Borrowers before this Amendment shall become effective. All corporate
action necessary for the valid execution, delivery and performance by each
Borrower of this Amendment shall have been duly and effectively taken, and
evidence thereof reasonably satisfactory to the Agent shall have been
provided to the Agent. Notwithstanding any other provision hereof, the
foregoing terms of this Article III shall constitute conditions precedent
to the effectiveness of this Amendment.
IV. AMENDED TERMS.
For all purposes hereafter, the term "Credit Agreement" shall mean
the Credit Agreement as amended by and through this Amendment.
V. MISCELLANEOUS.
Except as expressly set forth in Section II of this Amendment, the
execution, delivery, and effectiveness of this Amendment shall not (a)
limit, impair, constitute a waiver of, or otherwise affect any right,
power, or remedy by the Lenders, the Swing Line Lender, or the Agent under
the Credit Agreement, as amended by and through this Amendment, (b)
constitute a waiver of any provision in the Credit Agreement, as amended by
and through this Amendment, or (c) alter, modify, amend, or in any way
affect any of the terms, conditions, obligations, covenants, or agreements
contained in the Credit Agreement, as amended by and through this
Amendment, all of which are ratified and affirmed in all respects and shall
continue in full force and effect. This Amendment may be executed in any
number of counterparts, all of which together shall constitute one and the
same instrument. This Amendment shall be governed by the laws of the
Commonwealth of Massachusetts and shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns.
[The remainder of this page has been intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as a sealed instrument as of the date first set forth above.
DYNAMICS RESEARCH CORPORATION
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Vice President of Finance
DRC ENCODER, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer
DRC METRIGRAPHICS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer
DRC SOFTWARE, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer
DRC TELECOM, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Treasurer
per pro XXXXX BROTHERS XXXXXXXX & CO.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Deputy Manager
BANKBOSTON, N.A.
By: /s/ Xxxx X. Xxxxxxxx
Name: Xxxx X. Xxxxxxxx
Title: Vice President
THE CHASE MANHATTAN BANK
By: /s/ A. Xxxx Xxxxxx
Name: A. Xxxx Xxxxxx
Title: Vice President
STATE STREET BANK AND TRUST COMPANY
By: /s/ Xxxx Xxxxxx
Name: Xxxx Xxxxxx
Title: Vice President
CITIZENS BANK OF MASSACHUSETTS
By: /s/ R. E. Xxxxx Xxxxxx
Name: R. E. Xxxxx Xxxxxx
Title: Vice President
