EXHIBIT 10.1
FOREIGN EXCHANGE MASTER AGREEMENT
This Foreign Exchange Master Agreement (this "Agreement") is made this 31st day
of March, 2003 by and among CITIZENS BANK OF MASSACHUSETTS (the "Bank") with an
address of 00 Xxxxx Xxxxxx, Xxxxxx, XX 00000, Lightbridge, Inc. a Delaware
corporation, and its wholly owned subsidiaries, Corsair Communications, Inc. a
Delaware corporation, Coral Systems, Inc. a Delaware corporation and Lightbridge
Security Corporation a Massachusetts corporation, (jointly and severally
referred to herein as the "Customer").
WHEREAS, the Customer on a joint and several basis desires from time to time to
enter into transactions for the purchase of one currency in exchange for the
sale of another currency (each such transaction, an "FX Transaction") and the
Bank may agree to enter into FX Transactions at the direction of the Customer,
subject to the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the mutual covenants herein contained, and
other good and valuable consideration, receipt and sufficiency of which are
hereby acknowledged, the parties agree as follows:
I. INTERPRETATION
1. FOREIGN EXCHANGE AGREEMENT
Although neither the Customer nor the Bank shall have any
obligation to enter into FX Transactions, this Agreement sets
forth the general terms and conditions that will apply to each
FX Transaction entered into by and between the Customer and
the Bank. This Agreement, the terms agreed between the
Customer and the Bank with respect to each FX Transaction as
evidenced by a Confirmation (as hereinafter defined), and all
amendments to any of such items shall together form the
complete and exclusive agreement between the Customer and the
Bank. In the event of any inconsistency between this Agreement
and any Confirmation, the provisions of the Confirmation shall
prevail to extent necessary to resolve the conflict. In the
event this Agreement conflicts with any other agreement
between the Bank and the Customer, including without
limitation, the agreement and disclosures governing any
Account, the terms of this Agreement shall prevail to the
extent necessary to resolve such conflict. The Customer and
the Bank acknowledge that all FX Transactions are entered into
in reliance upon such fact, it being understood that the
Customer and the Bank would not otherwise enter into any FX
Transaction.
2. DEFINITIONS
"ACCOUNT" means the deposit account or accounts the Customer
maintains with the Bank for business or commercial purposes
and which the Customer has designated in the Authorization
Certificate as an account that is subject to this Agreement.
"APPLICABLE LAW" shall mean the laws of the United States
(including without limitation the USA Patriot Act and the
regulations promulgated thereunder), any applicable state laws
and regulations, including without limitation, the Uniform
Commercial Code as adopted by the state whose laws govern this
Agreement, the operating circulars of the Federal Reserve
System, the National Automated Clearing House Association
rules and any other rules of any money transfer systems used
by the Bank and any of the depository institutions necessary
to settle Payment Orders, each as in effect from time to time.
1
"AUTHORIZATION CERTIFICATE" means a certificate, substantially
in the form attached hereto as Schedule II (2).
"AUTHORIZED REPRESENTATIVE" means any of the Customer's
officers or employees that the Customer designates in an
Authorization Certificate as being the Customer's authorized
representative, or as authorized in writing to act on the
Customer behalf, with respect to an Order or any other actions
taken in accordance with the terms of this Agreement.
"BUSINESS DAY" means any day on which the Bank is open to
conduct substantially all of its business.
"CREDIT SUPPORT" means any Security Interest, deposit account,
guarantee, indemnity, surety, letter of comfort or other
arrangement required by the Bank in connection with this
Agreement.
"ELECTRONIC TRANSMISSION" means a message transmitted by
facsimile, telecopy, telex (whether or not tested), telegram,
radio, teletype, SWIFT, or any other form of non-paper media
transmitted by electronic or mechanical method of transmission
including e-mail and other internet transmissions through the
Web Site (but not telephone).
"EXCHANGE DATE" means any Business Day that is also a day on
which commercial banks effect delivery of the foreign currency
that is being bought or sold by the Customer pursuant to an
Order.
"FEDERAL FUNDS RATE" shall mean for the period involved, the
average of the interest rates for each day of the period set
forth in H 15(519) opposite the caption "Federal Funds
(Effective)." H 15(519) means the weekly statistical release
designated as such, or any such successor publication
published by the Board of Governors of the Federal Reserve
System.
"INDEBTEDNESS" means all sums now owing or that may in the
future be owing by the Customer to the Bank, whether direct or
indirect, whether on demand, at stated maturity, by
acceleration or otherwise, and whether for principal,
interest, purchase price, margin or additional payments, fees,
expenses, costs of replacement transactions, indemnification
or otherwise arising under or pursuant to any agreement with
the Bank, as all such agreements may be amended, restated or
replaced from time to time.
"INSOLVENCY EVENT" means the occurrence of any of the
following in respect of the Customer or the happening of any
similar or analogous event under the laws of any jurisdiction:
(a) the Customer shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or
other relief with respect to itself or to its debts
under any bankruptcy, insolvency or similar law, or
seeking the appointment of a trustee, receiver,
liquidator, conservator, administrator, judicial
manager, custodian or other similar official (each, a
"Custodian") of it or any substantial part of its
assets, or shall take any corporate action to
authorize any of the forgoing;
(b) an involuntary case or other proceeding shall be
commenced against the Customer seeking liquidation,
reorganization or other relief with respect to itself
or to its debt under any bankruptcy, insolvency or
similar law or seeking the appointment of a Custodian
of it or any substantial part of its assets;
(c) the Customer is bankrupt or insolvent; or
2
(d) the Customer shall otherwise be unable to pay its
debts as they become due.
"ORDER" means the Customer's instructions, which may be
transmitted by telephone or any other manner permitted by the
Bank from time to time, to purchase or sell a designated
number of units of a foreign currency at a specific price in
United States dollars or any other mutually agreed upon
currency.
"SECURITY INTEREST" means, without limitation, any and all
types of collateral security, present or future, whether in
the form of a lien, charge, encumbrance, mortgage, deed of
trust, xxxx of sale (as defined in any statute), pledge,
hypothecation, title retention arrangement, trust or power, as
or in effect as security for the payment of a monetary
obligation or the observance of any other obligation.
"SETTLEMENT DATE" means the Exchange Date specified in an
Order.
"TRANSACTION DOCUMENTS" means this Agreement (including all
Confirmations), any Credit Support, any letter from the Bank
to the Customer offering financial accommodation or foreign
exchange facilities which is accepted in writing by the
Customer, any instrument which is acknowledged to be a
Transaction Document and any other document connected with the
foregoing documents.
"WEB SITE" shall mean that internet site made available by the
Bank or any affiliate of the Bank to provide internet and
online services to its customers and to the Customer.
3. JOINT AND SEVERAL LIABILITY.
It is the intention of the parties to this Agreement that all
obligations of "Customer" or "Customers" created hereunder and
pursuant to all other Transaction Documents shall be the joint
and several obligations of Lightbridge, Inc., Corsair
Communications, Inc., Coral Systems, Inc., and Lightbridge
Security Corporation. All references to "Customer" shall be
interpreted to refer to any one of Lightbridge, Inc., Corsair
Communications, Inc., Coral Systems, Inc., or Lightbridge
Security Corporation alone, acting singly or in their sole
capacity or any two or more of them acting jointly or in
conjunction with any others. Unless the context of this
Agreement otherwise clearly requires, this Agreement shall be
interpreted in the light most favorable to this intention.
II. INITIATING AN FX TRANSACTION
1. ORDER
The Customer may initiate an FX Transaction by placing an
Order with the Bank, which Order the Bank may accept or reject
in its sole discretion. The Bank shall be under no obligation
to purchase or sell a currency at the most favorable exchange
rate then available. An Order must include the type of foreign
currency and the number of units of such foreign currency that
the Customer desires to purchase or sell at a specific price
in United States dollars and the Exchange Date on which the
purchase or sale shall occur. Subject to each party's rights
to correct errors as provided in Section II (4) below, an
Order may not be cancelled or amended after it has been
accepted by the Bank and a Confirmation has been sent.
3
2. AUTHORIZED REPRESENTATIVES
(a) The Customer agrees to give the Bank written notice
in an Authorization Certificate, or any other
document the Bank deems acceptable, of the names and
titles of the Customer's Authorized Representatives
and any dollar or other limits the Customer wants
placed on any Orders requested by the Customer or by
any such Authorized Representative. The Customer
agrees that the Bank may rely on the authority of an
Authorized Representative without independent
investigation or verification until the Customer has
provided the Bank with an amended Authorization
Certificate, or until the Bank has received written
notice to the contrary from the Customer, and the
Bank has had a reasonable opportunity to act upon any
such amended Authorization Certificate or notice. The
Bank shall be under no obligation to verify the
identity of any person who purports to be an
Authorized Representative.
(b) The Bank may, in its sole discretion, refuse to
accept an Authorized Representative or any person
that an Authorized Representative designates to act
on his or her behalf, or execute an Order from an
Authorized Representative or any person an Authorized
Representative designates to act on his or her behalf
until the Customer has provided the Bank with any
information or documentation in a form that is
acceptable to the Bank, which the Bank reasonably
considers necessary or appropriate in connection with
this Agreement. The Customer acknowledges that the
Bank may require a reasonable time period before the
Bank acts on any designation by the Customer of an
Authorized Representative, including any limits the
Customer wants placed on an Authorized
Representative.
(c) In the absence of any written notification to the
contrary, the Customer shall be able to rely upon any
employee of the Bank who works in the International
Department as having actual authority to agree to FX
Transactions on behalf of the Bank during normal
business hours (8:30 a.m. to 5:00 p.m. EST Monday to
Friday).
3. CONFIRMATION
If an Order is acceptable to the Bank, the Bank shall deliver
to the Customer a "Confirmation". A Confirmation shall be in
writing to the address specified by the Customer (including
telex, facsimile or other electronic means from which it is
possible to produce a hard copy) evidencing the Order and
itemizing the:
(a) name and address of the Customer,
(b) type of foreign currency and the number of units of
such foreign currency being bought or sold by the
Customer,
(c) Settlement Date,
(d) rate at which one currency will be exchanged into
another, and
(e) any other term generally included in such a writing
in accordance with the practice of the relevant
foreign exchange market.
4. CONFIRMATION OF FX TRANSACTION OR NOTICE OF ERROR
The Customer must review each Confirmation and either:
4
(a) confirm the FX Transaction, or
(b) promptly notify the Bank of any errors.
Failure to confirm does not negate, or vary in any way, an FX
Transaction entered into by telephone. If either party claims
that a Confirmation is incorrect in any respect, it must
notify the other party no later than two Business Days after
receipt of such Confirmation or such shorter period of time as
appropriate given the Settlement Date of the FX Transaction.
If a party notifies the other party of an error within such
time period, both parties shall negotiate in good faith to the
correct the terms of the FX Transaction. If a party does not
notify the other party of an error within such period, such
party will be deemed to have accepted the terms of the FX
Transaction as set forth in the Confirmation. In addition, if
the Bank performs its obligations in connection with an FX
Transaction in accordance with the terms set forth in a
Confirmation that has not been properly disputed as provided
herein, the Customer shall be obligated to perform its
obligations in accordance with the terms of such Confirmation.
IIA. COMMUNICATIONS WITH THE BANK
1. COMMUNICATIONS VIA THE INTERNET.
This Agreement contemplates that the Customer may choose to
electronically submit an Order to the Bank or receive and
review a Confirmation through the Web Site or by Electronic
Transmission, by accessing the Web Site or by sending or
receiving an Electronic Transmission through Customer's
computer equipment and web browser software. The Customer is
responsible for providing its own computer equipment and web
browser software and shall be responsible for all acquisition,
installation, repair and maintenance costs associated
therewith. The Customer shall select its own internet service
provider. The Customer shall comply promptly with all
instructions on the Web Site or as otherwise provided to the
Customer by the Bank governing its use and the security
measures to be maintained in connection with its use. The
Customer authorizes the Bank to receive data and act upon
Customer's Order and other requests that the Bank receives
over the Web Site. The Customer agrees that the Bank may rely
on the authenticity and accuracy of messages and information
received by the Bank on the Web Site purporting to be from the
Customer. The Customer agrees:
(a) to protect all assigned operator identification
passwords and accepts full responsibility for any
compromise of the Customer's security;
(b) to limit access to the Web Site to those persons
authorized by Customer through the use of security
procedures implemented and enforced by the Customer;
(c) to accurately input any data fields necessary to
initiate, release (subject to the other provisions of
this Agreement ) or cancel any Orders or
Confirmations;
(d) to access the Web Site as often as necessary
consistent with the business activities the Customer
conducts on the Web Site, which may be daily, and
retrieve and review outstanding Confirmations; and
(e) to notify the Bank promptly of any error or defect in
such Confirmation.
5
The Customer acknowledges and understands that Orders,
Confirmations and other instructions sent by it through the
internet to the Bank and the information retrieved by the
Customer from the Web Site through the internet will be
encrypted, but that such encryption is not completely secure
and is not free from errors, poor transmissions, interception,
forgery, viruses, tampering, destruction, deciphering or other
delay or casualty. The Bank shall not be liable for any loss,
claim or liability, cost or expense arising from:
(a) any of the foregoing;
(b) failure of any internet service provider to provide
its services;
(c) failure of communications media;
(d) legal restrictions;
(e) act of God, fire or other catastrophe, or any other
cause or circumstance beyond the Bank's control;
(f) any unauthorized person's use of or access to the Web
Site;
(g) computer hardware or software failure or
interruption, or
(h) failure of the Customer to report errors or defects
promptly.
2. COMMUNICATIONS VIA ELECTRONIC SYSTEMS.
The Customer may desire to transmit and receive by means of
facsimile, open internet communication, or other unguarded
electronic communications (hereinafter collectively the
"Electronic Systems") Orders, confirmations of Confirmations
and other paper-writings to or from the Bank. To induce the
Bank to accept communication via Electronic Systems, the
Customer shall:
(a) ensure that its officers, agents and employees, will
at all times follow and maintain the integrity of any
security established by the Customer and the Bank;
(b) promptly notify the Bank in the event that the
Customer should have reason to believe the security
established for Electronic Systems has been breached
or compromised in any manner;
(c) ensure that only authorized personnel selected and
controlled by the Customer request action(s) by
transmittal of document(s) by Electronic Systems;
(d) ensure that any documents transmitted to the Bank by
means of Electronic Systems shall be a complete and
accurate copy and if signed be executed by personnel
authorized by the Customer; and
(e) maintain its software and equipment and any privacy
control device within such software or equipment
without any reliance on or responsibility by the
Bank. The Customer acknowledges and agrees that the
Bank:
(i) shall not be responsible to the Customer for
any loss or damage arising from the use of
Electronic Systems, including access or
misuse of the Customer's
8
confidential information, transmission of a
virus, or failed, incomplete or inaccurate
transmission;
(ii) shall not be responsible to assure that, its
software and equipment for receiving
messages or documents from Electronic
Systems will be compatible with that of the
Customer or available at all times for the
Customer's use, but shall make reasonable
efforts to notify the customer if the Bank
becomes aware of such incompatibility or
availability;
(iii) has absolute discretion but without
liability, for any reason whatsoever, not to
act upon documentation received by
Electronic Systems; provided, however, that
the Bank shall notify the Customer promptly
should it elect to defer action until the
original documentation is physically
presented to the Bank;
(iv) has, without any liability on its part to do
so, the right at its discretion to make
further inquiries and demand further
verification to determine the validity of
any document prior to taking any action; and
(v) has the right to assume that any
reproduction of the original documentation
and all signatures are authorized and
genuine.
3. INDEMNITY.
Separate and independent from any other indemnity set forth in
this Agreement, the Customer hereby indemnifies and holds the
Bank harmless against any and all loss, liability, damage or
expense of whatever kind and nature arising from Bank's
acceptance and/or delivery of information, Orders or
Confirmations over its Web Site or by Electronic Systems.
III. SCOPE OF DUTY
1. FURTHER ASSURANCES
The Bank has no obligation to make any payment to the Customer
in connection with the Settlement of an FX Transaction it
previously accepted unless:
(a) The Bank has received any Credit Support it may
require;
(b) No Event of Default or any event which with the
giving of notice, lapse of time or fulfillment of any
condition would be likely to become an Event of
Default has occurred;
(c) The Bank has received an Authorization Certificate
and all approvals, delivery instructions, opinions or
other documents that it has reasonably requested; and
(d) The Bank believes that the making of any such payment
would not result in a violation of any Applicable Law
or reasonably subject the Bank to unacceptable risk
of loss.
2. NO OTHER OBLIGATIONS
The Bank shall only be obliged to act in accordance with this
Agreement and Orders properly given by the Customer to the
Bank as evidenced by a Confirmation. Unless otherwise agreed
to in writing, the Bank shall have no other obligations and,
in particular, the
7
Bank shall have no obligation to liquidate or to close any FX
Transaction or position on any Account the Bank may open for
the Customer.
IV. SETTLEMENT OF AN FX TRANSACTION
1. GENERAL
Subject to the other provisions of this Agreement, each party
will pay or deliver any amount payable by it in respect of an
FX Transaction for value on the Settlement Date all as
specified in the Confirmation in freely transferable funds and
in the manner customary for payments in the required currency.
2. NETTING PAYMENTS IN THE SAME CURRENCY
Unless otherwise agreed in a Confirmation, if on any
Settlement Date more than one delivery of a particular
currency is to be made between the parties, each party shall
aggregate the amounts of such currency deliverable by it and
only the difference between these aggregate amounts shall be
deliverable by the party owing the larger aggregate amount to
the other party, and if the amounts are equal, no delivery of
the currency shall be made.
3. INTEREST ON OVERDUE AMOUNTS
The Customer agrees to pay interest, both before and after
judgment, on any amount payable by it from when it becomes due
for payment until the Bank has been paid in full. Interest is
payable in the same currency as the overdue amount at a rate
equal to the Federal Funds Rate plus 2% per annum. Interest
will be calculated on a daily basis compounding monthly and on
the basis of the actual number of days elapsed. The Customer's
obligation to pay the outstanding amount on the date it
becomes due for payment is not affected by this clause.
4. AUTHORIZATION TO DEBIT ACCOUNTS
The Customer hereby expressly authorizes the Bank to debit all
of its Accounts for the purpose of making payment on its
behalf in the settlement of any FX Transaction or otherwise
obtaining any amounts owed to the Bank hereunder.
5. SETTLEMENT BY WIRE TRANSFER
In all cases where the settlement of a FX Transaction results
in the issuance by the Customer of a "Payment Order" (as that
term in defined in Article 4A of the Uniform Commercial Code
("Article 4A") as adopted by the state whose laws govern this
Agreement) to the Bank (i.e., an electronic transfer of the
foreign currency purchased or sold by the Customer), the
Customer agrees that:
(a) The Payment Order and funds transfer shall be
governed by Article 4A, and unless otherwise defined,
terms employed in this section shall have the
meanings ascribed to them in Article 4A.
(b) The Customer will provide the name of the
beneficiary, the name and identification number of
the beneficiary's bank, the beneficiary bank's
routing number or SWIFT code and the beneficiary's
account number.
(c) The Customer will pay any and all applicable Bank
fees and charges in respect of the funds transfer and
the Bank may debit any of the Accounts for such
amounts.
8
(d) The Bank has no obligation to accept and execute any
Payment Order if:
(i) the Account from which the FX Transaction is
to be settled does not contain sufficient
available and collected funds and the
amounts owed to the Bank to settle such FX
Transaction have not otherwise been paid by
the Customer,
(ii) the Payment Order is not authorized or does
not comply with applicable security
procedures
(iii) the Bank acting in good faith has reasonable
cause for rejecting the Payment Order or
(iv) the Bank believes such Payment Order would
violate any Applicable Law or involve an
unauthorized or fraudulent transfer.
(e) The Bank has no responsibility for failure to execute
a Payment Order where such failure is a result of a
delay by another bank or a Force Majeure Event (as
hereinafter defined).
(f) The Bank has no responsibility to give notice of
receipt of a funds transfer.
(g) The use by the Customer of any security procedure the
Bank establishes from time to time indicates the
Customer's agreement to the use of such security
procedure and its commercial reasonableness. The
Customer further agrees that the Bank's current
security procedure of calling an Authorized
Representative on a recorded line is a commercially
reasonable method for verifying that the Payment
Order (or any cancellation or amendment thereof) was
made by the Customer. The Customer acknowledges that
any security procedure used by the Bank is not
intended, and that it is commercially reasonable that
a security procedure is not intended, to detect any
errors relating to or arising out of a Payment Order
(or any cancellation or amendment thereof).
(h) In executing a Payment Order, payment may be made
solely on the basis of the account number even if
that number identifies a person different from the
named beneficiary.
(i) In executing a Payment Order, payment may be made
solely on the basis of the identification number or
routing number of the beneficiary bank even if that
number identifies a bank other than the named
beneficiary bank.
(j) The Customer bears the risk of any loss resulting
from payment to the wrong person due to a Customer
generated error in identification, account or routing
number.
(k) A cancellation or amendment of a Payment Order will
only be effective if the Customer notifies the Bank
in a manner such that the Bank has a reasonable
opportunity to cancel or amend the Payment Order
before it executes the Payment Order.
(l) The Customer will exercise ordinary care in detecting
unauthorized or erroneously executed Payment Orders
and will notify the Bank as soon as possible and in
any event within 14 days of such detection. The
Customer shall notify the Bank of the facts and
circumstances relating to any unauthorized Payment
Order or error
9
immediately after discovering any unauthorized
Payment Order or error. The Customer agrees to
provide the Bank with written notification of any
unauthorized Payment Order or error no later than
thirty (30) days after the Customer receives a
statement reflecting the Payment Order or error. If
the Customer fails to provide the Bank with such
notification within such time period and the Bank is
required under Applicable Law to refund all or part
of the funds attributable to the Payment Order, the
Bank will not pay any interest on the amount
refunded.
(m) To the extent that the Bank is required to pay
interest on any amounts that are subject to an error
made by it, such interest rate shall be set at the
Federal Funds Rate for the period in question.
V. REPRESENTATIONS AND WARRANTIES
In order to induce the Bank to enter into this Agreement and to enter
into FX Transactions, the Customer represents and warrants as of the
date of this Agreement, and continuing so long as any FX Transactions
remain outstanding, and so long as this Agreement remains in effect
that:
1. EXISTENCE
The Customer is duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is
organized.
2. AUTHORITY
The Customer has adequate power and authority to perform all
of its obligations under this Agreement and in respect of all
FX Transactions.
3. DUE EXECUTION
The execution and delivery by the Customer of this Agreement
and all Confirmations and the performance of the Customer's
obligations hereunder and thereunder:
(a) are within the Customer's powers;
(b) are duly authorized;
(c) are not in contravention of the terms of the
Customer's charter or bylaws, or of any indenture,
agreement or undertaking to which it is a party or by
which it or any of its property or assets are bound;
(d) do not require any order, consent, approval or
authorization of, or registration or declaration
with, or the giving of any notice to, or the granting
of any exemption by, any person; and
(e) do not contravene any law or contractual or
governmental restriction binding upon the Customer.
4. BINDING EFFECT
This Agreement is a legal, valid and binding obligation of the
Customer and will be enforceable against the Customer in
accordance with its terms.
10
VI. COVENANTS
The Customer covenants and agrees that so long as any FX Transactions
remain outstanding, and so long as this Agreement remains in effect,
unless otherwise consented to in writing by the Bank:
(a) The Customer will at all times obtain and comply with
the terms of and do all that is necessary to maintain
in full force and effect all authorizations,
approvals, licenses and consents required to enable
it to lawfully perform its obligations under this
Agreement.
(b) The Customer will promptly notify the Bank of the
occurrence of any Event of Default.
(c) The Customer must not create or permit to exist any
Security Interest upon USD 3,000,000 of its present
or future property or assets held by the Bank as
described in Article VII below.
VII. LIEN, SET-OFF AND COMBINATION
USD 3,000,000 of the Customer's interest in any securities or any other
property held by the Bank for any purpose (either individually or
jointly with others) which may be in the Bank's possession at any time
and for any purpose, including safekeeping, shall be subject to a
general lien in the Bank's favor. The Bank is authorized to set-off,
any sum due from the Customer to the Bank (whether or not under this
Agreement) against up to USD 3,000,000 in monies owing by the Bank to
the Customer, including money from time to time maintained by the
Customer with the Bank (whether for safe custody or otherwise). The
Bank is authorized to transfer and combine hereunder, in its reasonable
discretion, all funds in the name of the Customer from one Account to
another.
VIII. NON-PERFORMANCE AND THE EFFECT OF NON PERFORMANCE
1. EVENTS OF DEFAULTS
Each of the following shall constitute an "Event of Default"
under this Agreement:
(a) The Customer does not pay promptly when due and in
the manner required any money payable under any
Transaction Document.
(b) The Customer does not observe any other obligations
under any Transaction Document and, if the
non-observance can be remedied, does not remedy the
non-observance within 5 Business Days of notice from
the Bank.
(c) A material representation or warranty or statement
made, or deemed to be made or taken to be made to the
Bank in connection with a Transaction Document is
found to be incorrect or misleading when made or
deemed to be made.
(d) A default in the payment when due (subject to any
applicable grace period), whether by acceleration or
otherwise, of any Indebtedness of the Customer.
(e) An Insolvency Event occurs in respect of the
Customer.
(f) The Customer fails to give adequate assurances of its
ability to perform any of its obligations hereunder
within two (2) Business Days of written request to do
so when
11
the Bank has reasonable grounds for insecurity,
including the determination by the Bank of any
material adverse change to the financial condition of
the Customer.
(g) A Transaction Document is or becomes wholly or partly
void, voidable or unenforceable, or is claimed to be
so by the Customer or by anyone on its behalf.
2. EFFECT OF AN EVENT OF DEFAULT
If any Event of Default shall occur (and whether or not it is
continuing), the Bank shall have no further obligation to
enter into an FX Transaction, and may terminate this
Agreement. In addition, it shall have following rights:
(a) At the reasonable determination of the Bank, the Bank
may at any time by notice to the Customer terminate
all outstanding FX Transactions.
(b) The Bank's right of set-off described in Article VII
above shall be effective and enforceable immediately.
(c) Upon termination, no further payments in respect of
outstanding FX Transactions will be required to be
made. Instead, the Bank shall determine the net
amount required to "close out" all outstanding FX
Transactions. If such "close out" amount is a
positive number, the Customer will immediately pay
such amount to the Bank; if such "close out" amount
is a negative number, the Bank will pay the absolute
value of such amount to the Customer.
For purposes of this Section, "close out" means the United
States dollar equivalent of the amount the Bank reasonably
determines in good faith to be required to settle in the
market all existing and outstanding obligations arising from
all existing and outstanding FX Transactions, and such amount
can include any loss of bargain, cost of funding or any loss
or cost incurred as a result of the Bank terminating,
liquidating, obtaining and/or reestablishing any hedge or
related trading position (or any gain resulting from any of
them).
3. MISCELLANEOUS
Included in any demand for payment of any "close out" amount,
the Bank will provide the Customer with a statement showing,
in reasonable detail, the manner in which the Bank calculated
the "close out" amount. For greater certainty, the Customer
hereby expressly agrees and acknowledges that in the event of
any failure by the Customer to pay any "close out" amount due
to the Bank within five Business Days of demand, the Bank's
right of set-off as described in Article VII above shall apply
to such amount. The Bank's rights under this Article are in
addition to, and not in limitation or exclusion of, any other
rights which the Bank may have (whether by agreement,
operation of law or otherwise).
IX. MISCELLANEOUS
1. COMPLIANCE
The Customer and we each agree that all of FX Transactions
contemplated by this Agreement will be subject to, and will
comply with the Applicable Law, and the terms and conditions
of this Agreement.
12
2. ASSIGNMENT AND AMENDMENTS
All FX Transactions are for the benefit of the parties.
Neither party may act as trustee or agent for any other person
when entering an FX Transaction. No other person or entity
(including without limitation any customer of either party)
shall have any rights under any FX Transactions. The Customer
may not transfer, sell, assign, declare a trust of, or give a
Security Interest over all or part of their interest in any FX
Transaction or this Agreement without the written consent of
the Bank. No amendment or modification of this Agreement will
be effective unless executed in writing by each of the
parties. The Bank may assign its rights or delegate any of its
obligations hereunder without notice to or consent of the
Customer.
3. ACKNOWLEDGEMENT OF RISK
The Customer expressly confirms to the Bank that the Customer
has not relied on any representation or statement of the
Bank's as a basis for entering into this Agreement. The
Customer acknowledges the inherently speculative nature of any
advice, opinions or data relating to foreign currency values,
movements and trends and the Customer assumes the risks of
independently assessing such advice, opinions or data. The
Customer releases the Bank from any liability in relation to
any such advice, opinions or data which the Bank may give to
the Customer. The Bank further explicitly warns the Customer
that the risk of loss from FX Transactions can be substantial.
The Bank recommends that the Customer seek independent legal
and financial advice before opening a position with the Bank.
The Customer shall make all commercial decisions with respect
to all contracts entered into pursuant to this Agreement and
understands that any inexperience on the part of the Customer
with respect to trading in foreign exchange will increase the
likelihood of incurring a loss.
4. LIMITATION ON LIABILITY; INDEMNIFICATION.
(a) The Customer acknowledges that except as expressly
prohibited by Applicable Law, the Bank, in performing
its duties in accordance with this Agreement, shall
only be liable to the Customer for its actual damages
and only to the extent that such damages are a direct
result of the Bank's gross negligence or willful
misconduct. The Bank shall not be responsible for
delays or failures in the performance of its
obligations hereunder caused by acts of God, war,
civil commotion, governmental action, fire, action by
third parties, equipment malfunction, power failure
or any other events or circumstances beyond its
reasonable control (each a "Force Majeure Event"). IN
NO EVENT SHALL EITHER PARTY BE LIABLE FOR ANY
CONSEQUENTIAL, SPECIAL, INDIRECT OR PUNITIVE DAMAGES
(INCLUDING LOSS OF PROFIT OR ATTORNEYS' FEES) IN
CONNECTION WITH THIS AGREEMENT, REGARDLESS OF WHETHER
SUCH CLAIMS ARISE IN CONTRACT OR TORT EVEN IF A PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
WITH RESPECT TO PAYMENT ORDERS, THE BANK'S LIABILITY
SHALL BE FURTHER LIMITED AS PROVIDED IN ARTICLE IV
HEREOF.
(b) Except for losses that result from the Bank's gross
negligence or willful misconduct, the Customer agrees
to indemnify and hold the Bank harmless from any and
all losses the Customer may incur or suffer arising
from an FX Transaction or from any losses suffered by
the Bank arising out of any action taken or omitted
to be taken in reliance upon:
13
(i) any instruction or information provided to
the Bank whether in accordance with this
Agreement or not or
(ii) any information contained in a Confirmation
(other than any such information that has
been corrected in the manner provided in
Section II(4)).
5. DEALINGS BETWEEN THE PARTIES
The Customer agrees that the Bank accepts no responsibility
for any loss (consequential or otherwise) incurred as a result
of the Bank acting on instructions given by telephone, telex
or facsimile apparently given or sent by the Customer or its
Authorized Representatives. The Bank shall have no duty to
verify any notice sent by facsimile that appears to be proper
on its face. The Bank reserves the right to refuse any
instruction given by telephone, telex or facsimile. For
greater certainty, the Customer and the Bank further agree:
(a) Telephone conversations between parties may be
recorded and used as evidence. The Bank may also
record any Payment Orders. The parties consent to
such recordings and agree that the recordings or
transcripts can be used as evidence in disputes,
including without limitation, evidence:
(i) that an Order was placed or
(ii) of the Customer's authorization to act on a
Payment Order. Copies of recordings or
transcripts made by one party will be
supplied to the other upon request and upon
payment of the cost of complying with the
request. Neither party, however, is
obligated to so record, retain or reproduce
such items unless required to do so by
Applicable Law.
6. NO AGENCY OR JOINT VENTURE
The Customer and the Bank are not partners, joint ventures or
agents of each other as a result of this Agreement.
7. NOTICES
Unless otherwise agreed, all notices, instructions and other
communications to be given to a party under this Agreement
shall be given to the address, telex, facsimile (confirmed if
requested) or telephone number and to the individual or
department set forth below or specified in a writing that
complies with the terms of this Section. The Customer hereby
expressly agrees that any notice addressed as set out below
shall be deemed to be notice given to all of them.
To the Bank: Citizens Bank
International Banking
00xx Xxxxx
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Telephone Number: 0-000-000-0000
Facsimile Number: 000-000-0000
Telex Number: 211047 CTZINTLUR
Name of Salesperson:
14
To the Customer: Lightbridge, Inc.
00 Xxxxx Xxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000
Telephone Number: 000-000-0000
Facsimile Number: 000-000-0000
Telex Number:
Name of Individual or Department: Xxx Xxxxxxxx
8. GOVERNING LAW AND JURISDICTION, WAIVER OF JURY TRIAL
All FX Transactions entered into by the Bank and the Customer
shall be governed by and construed in accordance with the laws
of Massachusetts. Each party irrevocably waives any and all
right to trial by jury in any proceedings whether before a
court of law or otherwise.
9. TERMINATION
In addition to any rights to terminate this Agreement arising
as a result of the occurrence of an Event of Default, the Bank
reserves the right to terminate this Agreement at any time
upon 30 days' advance written notice to the Customer. The
Customer may terminate this agreement upon notice.
10. FURTHER ASSURANCES
The parties to this Agreement shall, upon the request of the
Bank, take any and all actions and execute any and all
documents reasonably necessary to effectuate the terms and
intent of this Agreement.
11. COUNTERPARTS
This Agreement may be executed in any number of counterparts,
which together shall constitute one instrument, and shall bind
and inure to the benefit of the parties hereto and their
respective permitted successors and assigns.
12. NO WAIVER
The Bank's failure, at any time or times hereafter, to require
strict performance by the Customer of any provision of this
Agreement shall not waive, affect or diminish any right of the
Bank thereafter to demand strict compliance and performance
therewith. Any suspension or waiver by the Bank of an Event of
Default by the Customer under this Agreement or a default
under any of the other Transaction Documents shall not
suspend, waive or affect any other Event of Default by the
Customer under this Agreement or any other default under any
of the other Transaction Documents, whether the same is prior
or subsequent thereto and whether of the same or of a
different kind or character. None of the undertakings,
agreements, warranties, covenants and representations of the
Customer contained in this Agreement or any of the other
Transaction Documents and no Event of Default by the Customer
under this Agreement or default under any of the other
Transaction Documents shall be deemed to have been suspended
or waived by the Bank unless such suspension or waiver is in
writing signed by an officer of the Bank, and directed to the
Customer specifying such suspension or waiver. The Bank shall
not be deemed to have waived any of its rights upon or under
this Agreement or any of the other Transaction Documents
unless such waiver is in writing and signed by the Bank. No
delay or omission on the part of the Bank in exercising any
other right shall operate as a waiver of such right or any
other right.
15
A waiver on any one occasion shall not be construed as a bar
to or waiver of the assertion of any right on any future
occasion.
13. SEVERABILITY
In the event any one or more of the provisions contained in
this Agreement should be held invalid, illegal or
unenforceable in any respect under the law of any
jurisdiction, the validity, legality and enforceability of the
remaining provisions contained in this Agreement, and the
validity, legality and enforceability of such and any other
provisions under the law of any other jurisdiction shall not
in any way be affected or impaired thereby. The parties shall
endeavor in good faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of
the invalid, illegal or unenforceable provisions.
14. HEADINGS
Headings in this Agreement are for ease of reference only.
15. SCHEDULES
Any authorization granted to any representative of the
Customer pursuant to any writing delivered to the Bank
hereunder, whether in the form of Schedule II (2) or by any
other means, shall remain in full force and effect until the
Bank receives express written notice that such authorization
has been revoked, and the Bank has had a reasonable period of
time to act in response to such notice.
16
IN WITNESS WHEREOF, the parties hereto have executed or caused
this Agreement to be executed by their respective officers
thereunto duly authorized, as of the day first written above
and it shall take effect as a sealed instrument.
LIGHTBRIDGE, INC.
By:
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxx
------------------------------ ----------------------
Name: Xxxxxx Xxxxxxx Witness
Title: CFO
CORSAIR COMMUNICATIONS, INC.
By:
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxx
------------------------------ ----------------------
Name: Xxxxxx Xxxxxxx Witness
Title: Treasurer
CORAL SYSTEMS, INC.
By:
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxx
------------------------------ ----------------------
Name: Xxxxxx Xxxxxxx Witness
Title: Treasurer
LIGHTBRIDGE SECURITY CORPORATION
By:
/s/ Xxxxxx Xxxxxxx /s/ Xxxxxx Xxxxxxxx
------------------------------ ----------------------
Name: Xxxxxx Xxxxxxx Witness
Title: Treasurer
CITIZENS BANK
By:
/s/ Xxxxxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxxxxx X. Xxxxxxxx
Title: Vice President
17
