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EXHIBIT 4.2
CREDIT AGREEMENT
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THIS AGREEMENT is made by and between the Company (as herein defined)
and the Lender (as herein defined).
In consideration of the covenants and agreements contained herein, the
Company and the Lender hereby mutually agree as follows:
ARTICLE I. DEFINITIONS
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SECTION 1.1. GENERAL. Any accounting term used but not specifically
defined herein shall be construed in accordance with GAAP. The definition of
each agreement, document, and instrument set forth in Section 1.2 hereof shall
be deemed to mean and include such agreement, document, or instrument as
amended, restated, or modified from time to time.
SECTION 1.2. DEFINED TERMS. As used in this Agreement:
"ADVISED LINE OF CREDIT" shall mean an uncommitted line of credit in
the amount of Three Million Dollars ($3,000,000.00) which, if issued shall be
subject to any reduction of the commitment of the Lender to make loans hereunder
pursuant to Section 2.1 hereof, and upon satisfaction of the following
conditions:
(a) No Event of Default or Potential Event shall have occurred.
(b) The Company shall have paid Lender any and all fees required
to issue credit on this Advised Line of Credit.
(c) Lender, in its sole discretion after application of prudent
lending guidelines, shall have approved issuance of the
Advised Line of Credit.
"APPLICABLE MARGIN" shall mean two percent (2%)
"BANK" shall mean Key Bank National Association, a national banking
association with its main office at 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxx
00000-0000, and its successors and assigns.
"BUSINESS DAY" means a day of the year on which banks are not required
or authorized to close in Cleveland, Ohio and, if the applicable Business Day
relates to any Libor Rate Loan, on which dealings are carried on in the London
interbank Eurodollar market.
"COMMITTED AMOUNT" shall mean Two Million Dollars ($2,000,000.00), the
amount of the Revolving Line of Credit, subject to any reduction of the
commitment of the Lender to make Loans hereunder pursuant to Section 2.1 upon
satisfaction of the following conditions:
(a) No Event of Default or Potential Event shall have occurred.
(b) The Company shall have paid Lender the fees set forth in
Section 2.6.
"COMPANY" shall mean Collaborative Clinical Research, Inc. ("CCLR") an
Ohio corporation, with its principal office located at 00000 Xxxxxxx Xxxx.,
Xxxxx 0000, Xxxxxxxxx, Xxxx 00000 and its successors.
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"ELIGIBLE ACCOUNTS RECEIVABLES" shall be defined as accounts receivable
less than or equal to ninety (90) days old, net of allowances for doubtful
accounts and net of advances on contracts.
"ENVIRONMENTAL LAW" means any federal, state, or local statute, law,
ordinance, code, rule, regulation, order or decree regulating, relating to, or
imposing liability upon a Person in connection with the use, release or disposal
of any hazardous toxic or dangerous substance, waste or material.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"EVENT OF DEFAULT" shall mean any one or more of the occurrences
described in ARTICLE VII hereof.
"FUNDED DEBT" shall mean all Indebtedness which matures more than one
year after the date such Indebtedness was incurred, less any portion thereof
that is payable within twelve (l2) months following the date as of which the
calculation is made.
"GAAP" shall mean generally accepted accounting principles as then in
effect, which shall include the official interpretations thereof by the
Financial Accounting Standards Board, consistently applied.
"INDEBTEDNESS" shall mean for any Person (i) all obligations to repay
borrowed money, direct or indirect, incurred, assumed, or guaranteed, (ii) all
obligations for the deferred purchase price of capital assets excluding trade
payable, (iii) all obligations under conditional sales or other title retention
agreements, and (iv) and all lease obligations which have been or should be
capitalized on the books of such Person and (v) all guarantees by such Person of
any of the foregoing.
"INTEREST PERIOD" means, with respect to any Libor Rate Loan, the
period commencing on the date such Loan is made, continued, or converted and
ending on the last day of such period as selected by the Company pursuant to the
provisions below and, thereafter, each subsequent period commencing on the last
day of the immediately preceding Interest Period and ending on the last day of
such period as selected by the Company pursuant to the provisions below. The
duration of each Interest Period for any Libor Rate Loan shall be thirty (30)
days provided that whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such Interest Period
shall occur on the next succeeding Business Day, provided that if such extension
of time would cause the last day of such Interest period for a Libor Rate Loan
to occur in the next following calendar month, the last day of such Interest
Period shall occur on the next preceding Business Day.
"LENDER" shall mean Key Corporate Capital Inc. with its chief
administrative office at 000 Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000-0000, and its
successors and assigns.
"LIBOR RATE" means for any Interest Period for any Libor Advance or
Libor Rate Loan, an interest rate per annum (rounded upwards to the next higher
whole multiple of 1/16% if such rate is not such a multiple) equal at all times
during such Interest Period to the rate per annum (rounded upward to the next
higher whole multiple of 1/16% if such rate is not such a multiple) at which
deposits in Untied States dollars are offered at 11:00 a.m. (London, England
time) (or as soon thereafter as is reasonably practicable) by prime banks in the
London interbank eurodollar market two Business Days prior to the first day of
such Interest Period in an amount and maturity of such Libor Advance or Libor
Rate Loan.
"LIBOR RATE LOAN" means any Loan that bears interest with reference to
the Libor Rate.
"LIBOR RESERVE REQUIREMENTS" means, for any Interest Period for any
Libor Rate Loan, the maximum reserves (whether basic, supplemental, marginal,
emergency, or otherwise) prescribed by the Board of Governors of the Federal
Reserve System (or any successor) with respect to liabilities or assets
consisting of or including "Eurocurrency liabilities" (as defined in Regulation
D of the Board of Governors of the Federal Reserve System) having a term equal
to such Interest Period.
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"LIEN" shall mean any mortgage, security interest, lien, charge,
encumbrance on, pledge or deposit of, or conditional sale or other title
retention agreement with respect to any property or asset.
"LOAN" OR "LOANS" shall mean the credit to the Company extended by the
Lender in accordance with Section 2.1(a) and (b) hereof.
"LOAN DOCUMENTS" shall mean this Agreement, the Note, the Security
Instruments, if any, and any other documents relating thereto.
"MARGIN STOCK" shall have the meaning given to it under Regulation U of
the Board of Governors of the Federal Reserve System, as amended from time to
time.
"MULTIEMPLOYER PLAN" shall mean a Plan described in ERISA which covers
employees of the Company and employees of any other Person, which together would
be treated as a single employer for purposes of ERISA.
"NOTE OR NOTES" shall mean the promissory note, in the form of Exhibits
A & B attached hereto, signed and delivered by the Company to evidence its
Indebtedness to the Lender in accordance with Section 2.1 hereof.
"PERSON" shall mean any natural person, corporation (which shall be
deemed to include business trust), association, limited liability company,
partnership, joint venture, political entity, or political subdivision thereof.
"PLAN" shall mean any plan (other than a Multiemployer Plan) defined in
ERISA in which the Company or any Subsidiary is, or has been at any time during
the preceding two (2) years, an "employer" or a "substantial employer" as such
terms are defined in ERISA.
"POTENTIAL DEFAULT" shall mean any condition, action, or failure to act
which, with the passage of time, service of notice, or both, will constitute an
Event of Default under this Agreement.
"PRIME RATE" shall mean that interest rate established from time to
time by the Lender as the Lender's Prime Rate, whether or not such rate is
publicly announced; the Prime Rate may not be the lowest interest rate charged
by Lender for commercial or other extensions of credit.
"PRIME RATE LOAN" means any Loan that bears interest with reference to
the Prime Rate.
"REVOLVING LINE OF CREDIT" shall mean the credit in the Committed
Amount evidenced by the Note in the form of Exhibit "A".
"SECURITY" shall mean Two Million Dollars ($2,000,000.00) that will be
invested in an account at Key Investment, Inc. and will be subject to KeyBank
Credit Policy advance rates as set forth in Section 5.9 hereof.
Lender shall also have first security interest in accounts receivable.
"SECURITY INSTRUMENT(S)" shall mean the written document(s) listed in
Exhibit C attached hereto, signed and delivered from time to time to the Lender
in connection with Indebtedness owed by Company to the Lender.
"SUBORDINATED DEBT" shall mean Indebtedness of a Person which is
subordinated, in a manner satisfactory to the Bank, to all Indebtedness owing to
the Lender.
"SUBSIDIARY" shall mean any Person of which more than fifty percent
(50%) of (i) the voting stock entitling the holders thereof to elect a majority
of the Board of Directors, managers, or trustees thereof, or (ii) the interest
in the capital or profits of such Person, which at the time is owned or
controlled, directly or indirectly, by the Company or one or more other
Subsidiaries.
"TERMINATION DATE" shall mean January 31, 2000, or such earlier date on
which the commitment of the Lender to make Loans under the Revolving Line of
Credit shall have been terminated pursuant to ARTICLE VIII of
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this Agreement. The credit facility may be extended for additional one (1) year
periods at Lender's sole discretion.
"TYPE" means, when used in respect of any Advance, the LIBOR Rate or
the Prime Rate in effect in respect of such Advance.
The foregoing definitions shall be applicable to the singulars and
plurals of the foregoing defined terms.
ARTICLE II. CREDIT FACILITY
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SECTION 2.1. AMOUNT OF CREDIT. The Lender hereby agrees, subject to the
terms and conditions of this Agreement, to make, continue, and convert Loans to
the Company as follows:
(a) The Lender will make one or more Loans to the Company under
the Revolving Line of Credit on the date of this Agreement in
an aggregate principal amount not to exceed Two Million
dollars ($2,000,000.00) outstanding at any one time. The
Lender during the loan period, upon the request of the
Company, shall also continue Loans of any type or any portion
thereof or convert Loans of one type or any portion thereof,
into Loans of another type at appropriate intervals.
(b) The Lender may in its sole and absolute discretion make one or
more Loans to the Company on an Advised Line of Credit, in an
aggregate principal amount not to exceed Three Million Dollars
($3,000,000.00) outstanding at any one time. The Lender may in
its discretion continue this Loan.
(c) The Lender will make one or more Loans to the Company under
the Revolving Line Credit from time to time on and after the
date of this Agreement through and including the Termination
Date, in an aggregate principal amount not to exceed the
Committed Amount outstanding at any one time. The Lender shall
upon the request of the Company continue Loans of any type or
any portion thereof or convert Loans of any type or any
portion thereof into Loans of another type at appropriate
intervals. The Company may borrow, prepay, and reborrow such
Loans; provided, however, that the Company may prepay any
Libor Rate Loan only on the last day of the applicable
Interest Period for such Loan. The Company may at any time or
from time to time, upon not less than ninety (90) Business
Days' prior notice made by telegraph, telex, or telephone and
confirmed in a writing delivered to the Lender, terminate or
reduce permanently the commitment of the Lender to make Loans
pursuant to this Section 2.1(a) hereof by the amount of
$100,000.00 or any integral multiple thereof; provided that
the Company shall immediately pay to the Lender the amount, if
any, by which the aggregate principal amount of such Loans
outstanding exceeds such reduced commitment of the Lender at
that time. If, however, after giving effect to any such
payment any Libor Rate Loans would be prepaid prior to the end
of their respective Interest Periods, the notice of the
termination or permanent reduction in the commitment of the
Lender to make Loans pursuant to Section 2.1(a) shall be
deemed to be the Company's request that such termination or
reduction be effective on the last day of such Interest
Periods. Concurrently with such reduction or termination, the
company shall pay the unpaid commitment fee that shall have
accrued on the portion of such terminated or reduced
commitment.
(d) Each Loan that is made as or converted into a Prime Rate Loan
shall be made or converted on such Business Day in such amount
(equal to One Hundred Thousand Dollars ($100,000.00) or an
integral multiple thereof) as the Company shall request by
written notice given to the Lender no later than 11:00 a.m.
(Cleveland, Ohio time) on the date of disbursement of or
conversion into the requested Prime Rate Loan, each Loan that
is made or continued as or converted into a Libor Rate Loan
shall be made, continued, or converted on such Business Day,
in such amount (equal to One Hundred Thousand Dollars
($100,000.00) or an integral multiple thereof), and with such
an interest Period as the Company shall request by written
notice given to the Lender no later than 11:00 a.m.
(Cleveland, Ohio time) on the third Business Day prior to the
date of disbursement or continuation of or conversion into the
requested Libor Rate Loan. Each written notice of any
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Libor Rate Loan shall be irrevocable and binding on the
Company and the Company shall indemnify the Lender against any
loss or expense incurred by the Lender as a result of any
failure by the Company to consummate such transaction,
including, without limitation, any loss (including loss of
anticipated profits) or expense incurred by reason of
liquidation or re-employment of deposits or other funds
acquired by the Lender to fund the Loan. A certificate as to
the amount of such loss or expense submitted by the Lender to
the Company shall be conclusive and binding for all purposes,
absent error. In the event that the Company fails to provide
the Lender with the required written notice, the Company shall
be deemed to have given a written notice that such Loan shall
be converted to a Prime Rate Loan on the last day of the
applicable Interest Period. All Loans shall be evidenced by
the Note, dated the date hereof. The Note shall be a master
note, and the principal amount of all loans outstanding shall
be evidenced by the Note or any ledger or other record of the
Lender, which shall be presumptive evidence of the principal
owing and unpaid on the Note.
(e) The Company shall repay to the Lender on the Termination Date,
the principal amount of all Loans under the Revolving Line of
Credit evidenced by the Note that are outstanding on the
Termination Date.
(f) The Company shall repay to the Lender on the earlier of July
31, 1998 or demand, the amount of all Loans under the Advised
Line of Credit.
SECTION 2.2. INTEREST RATE.
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(a) Each Libor Rate Loan shall bear interest at a fixed rate per
annum equal to the Libor Rate for such Interest Period plus
the Applicable Margin.
(b) Each Prime Rate Loan shall bear interest at a floating rate
per annum equal to Prime Rate. In the event of any change in
the Prime Rate, the rate of interest upon each Prime Rate Loan
shall be adjusted to immediately correspond with such change,
except such interest rate shall not exceed the highest rate
permitted by law.
SECTION 2.3. INTEREST PAYMENTS. The Company shall pay to the Lender
interest on the unpaid principal balance of each Prime Rate Loan monthly
commencing on April 1, 1998 or on the date such Loan is converted to a Libor
Rate Loan. The Company shall pay to the Lender interest on the unpaid principal
balance of each Libor Rate loan outstanding on the date such Loan is converted
to a Prime Rate Loan, or the last day of the applicable Interest Period of such
Loan, whichever is earlier. After maturity, whether by acceleration or
otherwise, the principal of the Loans and the unpaid interest and fees thereon
shall bear interest at three percent (3%) in excess of the highest applicable
interest rate provided herein.
SECTION 2.4. PREPAYMENT. The Company may prepay any Prime Rate Loans in
whole, or in part, in the principal amount of $50,000.00 or any integral
multiple thereof, at any time or times upon not less than one (1) Business Day's
prior notice made by telephone to the Lender. The Company may prepay any Libor
Rate Loan, in whole or in part, in the principal amount of $50,000.00 or any
integral multiple thereof only on the last day of the Interest Period applicable
to such Loan upon not less than one (1) Business Day's prior written notice
given to the Lender.
SECTION 2.5. USE OF PROCEEDS. The Loans shall be used as working
capital. Any excess proceeds shall be used by the Company for general operating
purposes consistent with the provisions of this Agreement.
SECTION 2.6. FEES. The Company shall pay to the Lender:
(a) An origination fee equal to Five Thousand Dollars ($5,000.00)
for the Revolving Credit Line of Credit payable on the date of
execution of this agreement.
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(b) A commitment fee computed at the rate of 25 basis points on
the unused portion of the Committed Amount. The commitment fee
will be paid quarterly in arrears.
(c) Prior to maturity (whether acceleration or otherwise), for
each payment of principal or interest not paid when due, a
late fee equal to five percent (5.0%) of such payment shall be
charged.
(d) Out of pocket expenses, including Lender's legal fees will be
paid by the Company on the date of execution of this
Agreement.
SECTION 2.7 COMPUTATION OF INTEREST AND FEES. Interest on Loans shall
be computed on the basis of a year of 360 days and paid for the actual number of
days elapsed. Interest on unpaid fees, if any, hereunder shall be computed on
the basis of a year of 360 days and paid for the actual number of days elapsed.
SECTION 2.8 ADDITIONAL COSTS.
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(a) If, due to either (i) the introduction of, or any change in,
or in the interpretation of, any law or regulation or (ii) the
compliance with any guideline or request from any central bank
or other governmental authority (whether or not having the
force of law), there shall be any increase in the cost to the
Lender of making, funding or maintaining Loans, then the
Company shall from time to time, upon demand by the Lender pay
to the Lender additional amounts sufficient to reimburse the
Lender for any such additional costs. A certificate of the
Lender submitted to the Company as to the amount of such
additional costs, shall be conclusive and binding for all
purposes, absent manifest error. Upon notice from the Company
to the Lender within five (5) Business Days after the Lender
notifies the Company of any such additional costs pursuant to
this Section 2.8(a), the Company may either (A) prepay in full
all Loans of any types so affected then outstanding, together
with interest accrued thereon to the date of such prepayment,
or (B) convert all Loans of any types so affected then
outstanding into Loans of any other type not so affected upon
not less than four (4) Business Days' notice to the Lender. If
any such prepayment or conversion of any Libor Rate Loan
occurs on any day other than the last day of the applicable
Interest Period for such Loan, the Company also shall pay to
the Lender such additional amounts sufficient to indemnify the
Lender against any loss, cost, or expense incurred by the
Lender as a result of such prepayment or conversion,
including, without limitation, any loss (including loss of
anticipated profits), cost, or expense incurred by reason of
the liquidation or reemployment of deposits or other funds
acquired by the Lender to fund any such Loan, and a
certificate as to the amount of any such loss, cost, or
expense submitted by the Lender to the Company shall be
conclusive and binding for all purposes, absent manifest
error.
(b) If either (i) the introduction of, or any change in, or in the
interpretation of, any law or regulation or (ii) the
compliance with any guideline or request from any central bank
or other governmental authority (whether or not having the
force of law), affects or would affect the amount of capital
required or expected to be maintained by the Lender or any
corporation controlling the Lender and the Lender determines
that the amount of such capital is increased by or based upon
the existence of the Loans (or commitment to make the Loans)
and other extensions of credit (or commitments to extend
credit) of similar type, then, upon demand by the Lender, the
Company shall pay to the Lender from time to time as specified
by the Lender additional amounts sufficient to compensate the
Lender in the light of such circumstances, to the extent that
the Lender reasonably determines such increase in capital to
be allocable to the existence of the Lender's Loans (or
commitment to make the Loans). A certificate of the Lender
submitted to the Company as to such amounts shall be
conclusive and binding for all purposes, absent manifest
error. Upon notice from the Company to the Lender within five
(5) Business Days after the Lender notifies the Company of any
such additional costs pursuant to this Section 2.8(b), the
Company may either (A) prepay in full all Loans of any types
so affected then outstanding, together with interest accrued
thereon to the date of such prepayment, or (B) convert all
Loans of any types so affected
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then outstanding into Loans of any other type not so affected
upon not less than four (4) Business Days' notice to the
Lender. If any such prepayment or conversion of any Libor Rate
Loan occurs on any day other than the last day of the
applicable Interest Period for such Loan, the Company also
shall pay to the Lender such additional amounts sufficient to
indemnify the Lender against any loss, cost, or expense
incurred by the Lender as a result of such prepayment or
conversion, including, without limitation, any loss (including
loss of anticipated profits), cost, or expense incurred by
reason of the liquidation or reemployment of deposits or other
funds acquired by the Lender to fund any such Loan, and a
certificate as to the amount of any such loss, cost, or
expense submitted by the Lender to the Company shall be
conclusive and binding for all purposes, absent manifest
error.
SECTION 2.9. ILLEGALITY. Notwithstanding any other provision of this
Agreement, if the introduction of or any change in or in the interpretation of
any law or regulation shall make it unlawful, or any central bank or other
governmental authority shall assert that it is unlawful, for the Lender to
perform its obligations hereunder to make, continue, or convert Libor Rate Loans
hereunder, then, (a) on notice thereof by the Lender to the Company, the
obligation of the Lender to make or continue a Loan of a type so affected or to
convert any type of Loan into a Loan of a type so affected shall terminate and
the Lender shall thereafter be obligated to make Prime Rate Loans whenever any
written notice requests any type of Loans so affected and (b) upon demand
therefor by the Lender to the Company, the Company shall either (i) forthwith
prepay in full all Loans of the type so affected then outstanding, together with
interest accrued thereon or (ii) request that the Lender, upon four (4) Business
Days' notice, convert all Loans of the type so affected then outstanding into
Loans of a type not so affected. If any such prepayment or conversion of any
Libor Rate Loan occurs on any day other than the last day of the applicable
Interest Period for such Loan, the Company also shall pay to the Lender such
additional amounts sufficient to indemnify the Lender against any loss, cost, or
expense incurred by the Lender as a result of such prepayment or conversion,
including, without limitation, any loss (including loss of anticipated profits),
cost, or expense incurred by reason of the liquidation or reemployment of
deposits or other funds acquired by the Lender to fund any such Loan, and a
certificate as to the amount of any such loss, cost, or expense submitted by the
Lender to the Company shall be conclusive and binding for all purposes, absent
manifest error.
ARTICLE III. WARRANTIES
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The Company represents and warrants to the Lender (which
representations and warranties will survive the delivery of the Note and all
extensions of credit under this Agreement) that:
SECTION 3.1. ORGANIZATION; CORPORATE POWER.
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(a) The Company is a corporation duly organized, validly existing,
and in good standing under the laws of the jurisdiction in
which it is incorporated;
(b) The Company has the corporate power and authority to own its
properties and assets and to carry on its business as now
being conducted;
(c) The Company is qualified to do business in every jurisdiction
in which the ownership or leasing of its property or the doing
of business requires such qualification; and
(d) The Company has the corporate power to execute, deliver, and
perform its Loan Documents and to borrow hereunder.
SECTION 3.2. AUTHORIZATION OF BORROWING. The execution, delivery, and
performance of the Loan Documents and the Loans by the Company have been duly
authorized by all requisite corporate action.
SECTION 3.3. NO CONFLICT. The execution, delivery, and performance of
the Loan Documents will not (a) violate any provision of law, the Articles of
Incorporation, the Code of Regulations, or By-Laws of the Company, (b) violate
any order of any court or other agency of any federal or state government or any
provision of
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any indenture, agreement, or other instrument to which the Company is a party or
by which it or any of its properties or assets are bound, (c) conflict with,
result in a breach of, or constitute (with passage of time or delivery of
notice, or both), a default under any such indenture, agreement, or other
instrument, or (d) result in the creation or imposition of any Lien or other
encumbrance of any nature whatsoever upon any of the properties or assets of the
Company except in favor of the Lender.
SECTION 3.4. EXECUTION OF LOAN DOCUMENTS. The Loan Documents have been
duly executed and are valid and binding obligations of the Company fully
enforceable in accordance with their respective terms.
SECTION 3.5. FINANCIAL CONDITION. The Company has furnished to the
Lender true and correct financial statements prepared by a certified public
accountant as of the end of the Company's fiscal year which ended December 31,
1996, which audited financial statements present fairly the Company's financial
condition at such date, and there has been no material adverse change in the
Company's financial condition since that date.
SECTION 3.6. LIABILITIES; LIENS. Except as set forth in the schedules
herein attached, the Company has made no investment in, advance to, or guarantee
of, the obligations of any Person nor are the Company's assets and properties
subject to any claims, liabilities, Liens, or other encumbrances, except as
disclosed in the financial statements and related notes thereto referred to in
Section 3.5 hereof.
SECTION 3.7. LITIGATION. Except as set forth in the schedules herein
attached, there is no action, suit, examination, review, or proceeding by or
before any governmental instrumentality or agency now pending or, to the
knowledge of the Company, threatened against the Company or against any property
or rights of the Company, which, if adversely determined, would materially
impair the right of the Company to carry on business as now being conducted or
which would materially adversely affect the financial condition of the Company,
except for the litigation, if any, described in the notes to the financial
statements referred to in Section 3.5 hereof.
SECTION 3.8. PAYMENT OF TAXES. Federal income tax returns of the
Company have been examined by the Internal Revenue Service for all years prior
to and including its fiscal year which ended December 31, 1996, and all
deficiencies finally resulting from such examinations have been discharged or
proper amounts have been set aside on the Company's books to cover such
deficiencies. The Company has filed, or caused to be filed, all Federal, state,
local, and foreign tax returns required to be filed, and has paid, or caused to
be paid, all taxes as are shown on such returns, or on any assessment received
by the Company, to the extent that such taxes become due, except as otherwise
contested in good faith. The Company has set aside proper amounts on its books,
determined in accordance with GAAP, for the payment of all taxes for the years
that have not been audited by the respective tax authorities or for taxes being
contested by the Company.
SECTION 3.9. AGREEMENTS. Except as set forth in the schedules herein
attached, the Company is not in default in the performance, observance, or
fulfillment of any of the obligations, covenants, or conditions contained in any
agreement or instrument to which it is a party, which default materially
adversely affects the business, properties, assets, or financial condition of
the Company.
SECTION 3.10. REGULATORY STATUS. Neither the making nor the performance
of this Agreement, nor any extension of credit hereunder, requires the consent
or approval of any governmental instrumentality or political subdivision
thereof, any other regulatory or administrative agency, or any court of
competent jurisdiction.
SECTION 3.11. FEDERAL RESERVE REGULATIONS: USE OF LOAN PROCEEDS. The
Company is not engaged principally, or as one of its important activities, in
the business of extending credit for the purpose of purchasing or carrying any
Margin Stock. No part of the proceeds of the Loans will be used, directly or
indirectly, for a purpose which violates any law, rule or regulation of any
governmental body, including without limitation the provisions of Regulations G,
U, or X of the Board of Governors of the Federal Reserve System, as amended. No
part of the proceeds of the Loans will be used, directly or indirectly, to
purchase or carry any Margin Stock or to extend credit to others for the purpose
of purchasing or carrying any Margin Stock. Following application of the
proceeds of each Loan, not more than 25 percent of the value of the assets of
the Company and its Subsidiaries on a consolidated basis will be Margin Stock.
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SECTION 3.12. SUBSIDIARIES. The Company has no Subsidiaries, other than
as set for in the schedules herein attached herein.
SECTION 3.13. LICENSES. The Company has all licenses, franchises,
consents, approvals, or authorizations required in connection with the conduct
of the business of the Company, the absence of which would have a material
adverse affect on the conduct of the Company's business, and all such licenses,
franchises, consents, approvals, and authorizations are in full force and
effect.
SECTION 3.14. ERISA. The Company does not maintain, sponsor, or
participate in any Plan or Multiemployer Plan insured, or required to be
insured, by the Pension Benefit Guaranty Corporation.
SECTION 3.15. ENVIRONMENTAL MATTERS. The Company is in compliance with
all Environmental Laws and all applicable federal, state and local health and
safety laws, regulations, ordinances or rules, except to the extent that any
non-compliance will not, in the aggregate, have a materially adverse effect on
the Company or the ability of the Company to fulfill its obligations under this
Agreement or the Note.
SECTION 3.16. SOLVENCY. The Company has received consideration which is
the reasonable equivalent value of the obligations and liabilities that the
Company has incurred to Bank. The Company is not insolvent as defined in any
applicable state or federal statute, nor will the Company be rendered insolvent
by the execution and delivery of this Agreement or the Note to Lender. The
Company is not engaged or about to engage in any business or transaction for
which the assets retained by it shall be an unreasonably small capital, taking
into consideration the obligations to Lender incurred hereunder. The Company
does not intend to, nor does it believe that it will, incur debts beyond its
ability to pay them as they mature.
ARTICLE IV. CONDITIONS OF LENDING
---------------------------------
SECTION 4.1. FIRST LOAN. The obligation of the Lender to make a Loan
shall be subject to satisfaction of the following conditions, unless waived in
writing by the Lender: (a) all legal matters and Loan Documents incident to the
transactions contemplated hereby shall be satisfactory, in form and substance,
to Lender's counsel; (b) the Lender shall have received (i) certificates by an
authorized officer of the Company, upon which the Lender may conclusively rely
until superseded by similar certificates delivered to the Lender, certifying (1)
all requisite action taken in connection with the transactions contemplated
hereby and (2) the names, signatures, and authority of the Company's authorized
signers executing the Loan Documents, and (ii) such other documents as the
Lender may reasonably require to be executed by, or delivered on behalf of, the
Company; (c) the Lender shall have received the Note with all blanks
appropriately completed, executed by an authorized signer of the Company; (d)
the Company shall have paid to the Lender the fee(s) then due and payable in
accordance with ARTICLE II of this Agreement; (e) the Lender shall have received
the written opinion of legal counsel selected by the Company and satisfactory to
the Lender, dated the date of this Agreement, in the form of Exhibit C attached
to this Agreement, and covering such other matter(s) as the Lender may
reasonably require; (f) the Lender shall have received written instructions by
the Company with respect to disbursement of the proceeds of the Loan; (g) the
Lender shall have received all Security Instruments duly executed by all parties
thereto; provided, the obligation of the Lender to make any Loan under the
Advised Line of Credit is subject to the sole and absolute discretion of the
Lender.
SECTION 4.2. EACH LOAN. The obligation of the Lender to make any Loan
shall be subject to compliance with Section 4.l herein and also subject to
satisfaction of the following conditions that at the date of making such Loan,
and after giving effect thereto: (a) no Event of Default or Potential Default
shall have occurred and be then continuing and (b) each representation and
warranty set forth in ARTICLE III above is true and correct as if then made.
ARTICLE V. AFFIRMATIVE COVENANTS
--------------------------------
As long as credit is available hereunder or until all principal of and
interest on the Note have been paid in full:
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SECTION 5.1. ACCOUNTING; FINANCIAL STATEMENTS AND OTHER INFORMATION.
The Company will maintain a standard system of accounting, established and
administered in accordance with GAAP consistently followed throughout the
periods involved, and will set aside on its books for each fiscal quarter the
proper amounts or accruals for depreciation, obsolescence, amortization, bad
debts, current and deferred taxes, prepaid expenses, and for other purposes as
shall be required by GAAP. The Company will deliver to the Lender:
(a) As soon as practicable after the end of each fiscal quarter in
each year, except the last, and in any event within forty-five
(45) days thereafter, a balance sheet of the Company as of the
end of such quarter, and statements of income, changes in
financial position, and shareholders' equity of the Company
for such quarter, certified as complete and correct by the
principal financial officer of the Company, subject to changes
resulting from year-end adjustments;
(b) As soon as practicable after the end of each fiscal year, and
in any event within one hundred twenty (120) days thereafter,
a balance sheet of the Company as of the end of such year, and
statements of income, changes in financial position, and
shareholders' equity of the Company for such year, setting
forth in each case in comparative form the figures for the
previous fiscal year, all in reasonable detail and accompanied
by a report and an unqualified opinion of independent
certified public accountants of recognized standing, selected
by the Company and satisfactory to the Bank;
(c) Together with each set of financial statements required by
subparagraph (a) above, a certificate by the chief financial
officer or other authorized officer of the Company stating
whether or not there exists any Event of Default or Potential
Default, specifying the nature and period of existence thereof
and what action, if any, the Company is taking or proposes to
take with respect thereto;
(d) With reasonable promptness, such other data and information as
from time to time may be reasonably requested by the Lender;
(e) Promptly and in any event within ten (10) days after the
occurrence of a Reportable Event with respect to a Plan, a
copy of any materials required to be filed with the PBGC with
respect to such Reportable Event or these that would have been
required to be filed if the thirty (30) day notice requirement
to the PBGC were not waived;
(f) Promptly upon receipt, and in no event more than three (3)
days after receipt of a notice by the Company or any ERISA
Affiliate or any administrator of any Plan or Multi-employee
Plan that the PBGC has instituted proceedings to terminate
such Plan or to appoint a trustee to administer such Plan, a
copy of such notice;
(g) As soon as practicable after the end of each month, and in any
event within thirty (30) days thereafter, an accounts
receivable aging report in a form acceptable to Lender, will
be provided to the Lender.
SECTION 5.2. INSURANCE; MAINTENANCE OF PROPERTIES. The Company will
maintain with financially sound and reputable insurers, insurance with coverage
and limits as may be required by law or as may be reasonably required by the
Lender. The Company will, upon request from time to time, furnish to the Lender
a schedule of all insurance carried by it, setting forth in detail the amount
and type of such insurance. The Company will maintain in good repair, working
order, and condition, all properties used or useful in the business of the
Company.
SECTION 5.3. EXISTENCE; BUSINESS. The Company will cause to be done all
things necessary to preserve and keep in full force and effect its existence and
rights, to conduct its business in a prudent manner, to maintain in full force
and effect, and renew from time to time, its franchises, permits, licenses,
patents, and trademarks that are necessary to operate its business. The Company
will comply in all material respects with all valid laws and regulations now in
effect or hereafter promulgated by any properly constituted governmental
authority having jurisdiction; provided, however, the Company shall not be
required to comply with any law or regulation which it is
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contesting in good faith by appropriate proceedings as long as either the effect
of such law or regulation is stayed pending the resolution of such proceedings
or the effect of not complying with such law or regulation is not to jeopardize
any franchise, license, permit patent, or trademark necessary to conduct the
Company's business.
SECTION 5.4. PAYMENT OF TAXES. The Company will pay all taxes,
assessments, and other governmental charges levied upon any of its properties or
assets or in respect of its franchises, business, income, or profits before the
same become delinquent, except that no such taxes, assessments, or other charges
need be paid if contested by the Company in good faith and by appropriate
proceedings promptly initiated and diligently conducted and if the Company has
booked appropriate reserves, determined in accordance with GAAP, for the payment
of all such taxes, changes, and assessments.
SECTION 5.5. LITIGATION; ADVERSE CHANGES. The Company will promptly
notify the Lender in writing of (a) any future event which, if it had existed on
the date of this Agreement, would have required qualification of the
representations and warranties set forth in ARTICLE III hereof and (b) any
material adverse change in the condition, business, or prospects, financial or
otherwise, of the Company.
SECTION 5.6. NOTICE OF DEFAULT. The Company will promptly notify the
Lender of any Event of Default or Potential Default hereunder and any demands
made upon the Company by any Person for the acceleration and immediate payment
of any Indebtedness owed to such Person.
SECTION 5.7. INSPECTION. The Company will make available for inspection
by duly authorized representatives of the Lender, or its designated agent, the
Company's books, records, and properties three (3) times a year, unless the loan
is in default, and will furnish the Lender such information regarding its
business affairs and financial condition within a reasonable time after written
request therefor.
SECTION 5.8. ENVIRONMENTAL MATTERS. The Company and each of its
Subsidiaries:
(a) Is in compliance with all Environmental Laws and all
applicable federal, state and local health and safety laws,
regulations, ordinances or rules, except to the extent that
any non-compliance will not in the aggregate, have a
materially adverse effect on the Company or the ability of the
Company to fulfill its obligations Agreement or the Note.
(b) Shall deliver promptly to Lender (i) copies of any documents
received from the United States Environmental Protection
Agency or any state, county or municipal environmental or
health agency, and (ii) copies of any documents submitted by
Company or any of its Subsidiaries to the United States
Environmental Protection Agency or any state, county or
municipal environmental or health agency concerning its
operations.
SECTION 5.9. SECURITY FOR LOAN(S). The Company will maintain in an
account maintained by Company at KeyBank National Association or one of its
subsidiaries the sum of Two Million Dollars ($2,000,000.00) as collateral for
the Revolving Line of Credit; advances under Revolving Line of Credit will be
based on KeyBank Credit Policy advance rates which are currently:
TYPE MAXIMUM PERCENT ADVANCE ON MARKET VALUE
Traded Common or Preferred Stock 65%
Traded Corporate Bond 80%
U.S. Treasury Bond 85%
U.S. Agency Bond 70%
Mutual Fund 60%
Cash Value Life Insurance 90%
Key Corp. Bank Time Deposit 100%
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These advance rates are subject to change from time to time in the sole
discretion of the Bank.
SECTION 5.10. SECURITY FOR ADVISED LINE. Should the Lender issue any
Loans on the Advised Line of Credit, the Company will maintain an Eligible
Accounts Receivable balance in an amount equal to one hundred thirty three
percent (133%) of the Advised Line of Credit outstanding at that time.
ARTICLE VI. NEGATIVE COVENANTS
------------------------------
As long as credit is available hereunder or until all principal of and
interest on the Notes have been paid in full:
SECTION 6.1. SALE OR PURCHASE OF ASSETS. The Company will not, directly
or indirectly, (a) purchase, lease, or otherwise acquire any assets except in
the ordinary course of business or as otherwise permitted by any provision of
this Agreement or (b) sell, lease, transfer, or otherwise dispose of any plant
or any manufacturing facility or other assets; PROVIDED, that this Section shall
not prohibit any of the actions referenced in clauses (a) or (b) above so long
as the taking of such action does not (i) materially and adversely affect the
financial condition of the Company and (ii) materially and adversely affect the
Collateral of the Lender (as defined in the Security Instruments).
SECTION 6.2. LIENS. The Company will not, directly or indirectly,
create, incur, assume, or permit to exist any Lien with respect to any property
or asset of the Company now owned or hereafter acquired other than:
(a) Liens for taxes or governmental assessments, charges, or
levies the payment of which is not at the time required by
Section 5.4 hereof;
(b) Liens imposed by law, such as Liens of landlords, carriers,
warehousemen, mechanics, and materialmen arising in the
ordinary course of business for sums not yet due or being
contested by appropriate proceedings promptly initiated and
diligently conducted, provided the Company has reserved proper
amounts, determined in accordance with GAAP, for the payment
of all such Liens;
(c) Liens incurred or deposits made in the ordinary course of
business in connection with worker's compensation,
unemployment insurance, and other types of social security, or
to secure the performance of tenders, statutory obligations,
and surety and appeal bonds, or to secure the performance and
return of money bonds and other similar obligations, but
excluding Indebtedness; and
(d) Liens in respect of judgments or awards with respect to which
the Company shall, in good faith, be prosecuting an appeal or
proceeding for review and with respect to which a stay of
execution upon such appeal or proceeding for review shall have
been obtained;
(e) Liens that secure the Company's Indebtedness for the purchase
price of any real or personal property and that only encumber
the property purchased so long as no such Liens, when taken
singly or in the aggregate materially and adversely affects
the financial condition of the Company;
(f) Liens disclosed in the financial statements and related notes
thereto;
(g) Liens in favor of the Lender or any affiliate of Lender.
SECTION 6.3. INDEBTEDNESS. The Company will not, directly or
indirectly, create, incur, or assume Indebtedness, or otherwise become liable
with respect to, any Indebtedness other than:
(a) Indebtedness now or hereafter payable, directly or indirectly,
by the Company to the Lender or any Affiliate;
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(b) Subordinated Debt of the Company;
(c) To the extent permitted by this Agreement, Indebtedness for
the purchase price of any real or personal property, which is
secured only by a Lien on the property purchased;
(d) Unsecured current Indebtedness and deferred liabilities (other
than for borrowed money or represented by bonds, notes, or
other securities) incurred in the ordinary course of business;
and
(e) Indebtedness for taxes, assessments, governmental charges,
liens, or similar claims to the extent not yet due and
payable.
(f) Any unsecured or secured Indebtedness so long as the
incurrence thereof does not (i) materially and adversely
affect the financial condition of the Company and (ii)
materially and adversely affect the collateral of the Lender
(as defined in the Security Instruments).
SECTION 6.4. INVESTMENTS; LOANS. The Company will not, directly or
indirectly, (a) purchase or otherwise acquire or own any stock or other
securities of any other Person or (b) make or permit to be outstanding any loan
or advance (other than trade advances in the ordinary course of business) or
enter into any arrangement to provide funds or credit, to any other Person;
PROVIDED, that this Section shall not prohibit any of the actions referenced in
clauses (a) or (b) above so long as the taking of such action does not (i)
materially and adversely affect the financial condition of the Company and (ii)
materially and adversely affect the Collateral of the Lender (as defined in the
Security Instruments).
SECTION 6.5. MERGERS; CONSOLIDATION. The Company will not merge or
consolidate with any Person or sell, assign, lease, or otherwise dispose of
(whether in one transaction or in a series of transactions), all or
substantially all of its assets (whether now owned or hereafter acquired) to any
Person; PROVIDED, that this Section shall not prohibit any merger or
consolidation so long as (a) such merger or consolidation does not (i)
materially and adversely affect the financial condition of the Company and (ii)
materially and adversely affect the Collateral of the Lender (as defined in the
Security Instruments) and (b) the surviving entity of such merger or
consolidation acknowledges that it is bound by the terms of this Agreement and
the Security Instruments in writing and takes such action as is required by the
Lender to maintain its security interest in the Collateral (as defined in the
Security Instruments).
ARTICLE VII. EVENTS OF DEFAULT
------------------------------
The occurrence of any one or more of the following events shall
constitute an Event of Default under this Agreement:
SECTION 7.1. PRINCIPAL OR INTEREST. If the Company fails to pay any
installment of principal or interest on that or any other sums of money within
three (3) days after its due date under this Agreement; or
SECTION 7.2. MISREPRESENTATION. If any representation or warranty made
herein by the Company or in any written statement, certificate, report, or
financial statement at any time furnished by, or on behalf of the Company in
connection herewith, is incorrect or misleading in any material respect when
made or furnished, at anytime thereafter; or
SECTION 7.3. FAILURE OF PERFORMANCE OF THIS AGREEMENT. If the Company
fails to perform or observe any covenant or agreement contained in this
Agreement, other than any sums of money payable hereunder, and such failure
remains unremedied for thirty (30) calendar days after the Lender shall have
given written notice thereof to the Company; or
SECTION 7.4. CROSS-DEFAULT. If the Company (or any Guarantor) (a) fails
to pay any Indebtedness (other
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than as evidenced by the Note) owing by the Company (or such Guarantor) in the
aggregate principal amount of more than Two Hundred Fifty Thousand Dollars
($250,000.00) when due, whether at maturity, by acceleration, or otherwise or
(b) fails to perform any term, covenant, or agreement on its part to be
performed under any agreement or instrument (other than the Loan Documents)
evidencing, securing, or relating to such Indebtedness when required to be
performed, or is otherwise in default thereunder, if the effect of such failure
is to accelerate, or to permit the holder(s) of such Indebtedness or the
trustee(s) under any such agreement or instrument to accelerate, the maturity of
such Indebtedness, whether or not such failure shall be waived by such holder(s)
or trustee(s); or
SECTION 7.5. EVENT OF DEFAULT UNDER ANY SECURITY INSTRUMENT. If an
event of default occurs (with passage of time or service of notice, or both) and
is continuing under the terms of any Security Instrument; or
SECTION 7.6. ERISA. If the Company at anytime hereafter sponsors or
establishes any Plan, and the Company (a) fails to notify the Lender in writing
of such occurrence within ten (l0) days after such Plan is authorized by the
Board of Directors or otherwise by the Company or (b) fails to agree within a
reasonable time to such amendments to this Agreement regarding provisions with
respect to ERISA as the Lender customarily uses at that time in loan agreements
with other borrowers; or
SECTION 7.7. INSOLVENCY. If the Company (or any Guarantor) shall
discontinue business or (a) is adjudicated a bankrupt or insolvent under any law
of any existing jurisdiction, domestic or foreign, or ceases, is unable, or
admits in writing its inability, to pay its debts generally as they mature, or
makes a general assignment for the benefit of creditors, (b) applies for, or
consents to, the appointment of any receiver, trustee, or similar officer for it
or for any substantial part of its property, or any such receiver, trustee, or
similar officer is appointed without the application or consent of the Company
(or such Guarantor), and such appointment continues thereafter undischarged for
a period of thirty (30) days, (c) institutes, or consents to the institution of
any bankruptcy, insolvency, reorganization, arrangement, readjustment or debt,
dissolution, liquidation, or similar proceeding relating to it under the laws of
any jurisdiction, (d) any such proceeding is instituted against the Company (or
such Guarantor) and remains thereafter undismissed for a period of sixty (60)
days, or (e) any judgment, writ, warrant of attachment or execution, or similar
process is issued or levied against a substantial part of the property of the
Company or any Subsidiary (or Guarantor) and such judgment, writ, or similar
process is not effectively stayed within thirty (30) days after its issue or
levy, or any Guarantor becomes deceased.
ARTICLE VIII. REMEDIES UPON DEFAULT
-----------------------------------
SECTION 8.1. OPTIONAL ACCELERATION. In the event that one or more of
the Events of Default set forth in Sections 7.l through 7.6 above occurs and
continues and is not waived by the Lender, then, in any such event, and at any
time thereafter, the Lender may, at its option, terminate its commitment to make
any Loan and declare the unpaid principal of, and all accrued interest on, the
Note, and any other liabilities hereunder, and all other Indebtedness of the
Company to the Lender forthwith due and payable, whereupon the same will
forthwith become due and payable without presentment, demand, protest, or other
notice of any kind, all of which the Company hereby expressly waives, anything
contained herein or in the Note to the contrary notwithstanding.
SECTION 8.2. AUTOMATIC ACCELERATION. Upon the happening of an Event of
Default referred to in Section 7.7 above, the unpaid principal of, and all
accrued interest on, the Note, and any other liabilities hereunder and all other
Indebtedness of the Company to the Lender then existing will thereupon become
immediately due and payable in full and the commitment, if any, of the Lender to
make any Loan, if not previously terminated, will thereupon immediately
terminate without presentment, demand, protest, or notice of any kind, all of
which are hereby expressly waived by the Company, anything contained herein or
in the Note to the contrary notwithstanding.
SECTION 8.3. RIGHT OF SET OFF; SECURITY. Upon the occurrence and
continuation of an Event of Default, the Lender has the right, in addition to
all other rights and remedies available to it, to set off the unpaid balance of
the Note and any other Indebtedness payable to the Lender held by it against any
debt owing to the Company by the Lender or by any Affiliate, including, without
limitation, any obligation under a repurchase agreement or any funds held at
anytime by the Lender or any Affiliate, whether collected or in the process of
collection, or in any time or demand deposit account maintained by the Company
at, or evidenced by any certificate of deposit issued by, the
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Lender or any Affiliate. The Company hereby grants, pledges, and assigns to the
Lender a security interest in, or lien upon, all cash, negotiable instruments,
securities, deposit accounts, and other cash equivalents, whether collected or
in the process of collection, whether matured or unmatured, now or hereafter in
the possession of the Bank or any Affiliate and upon which the Company has or
may hereafter have any claim. The Company acknowledges and agrees that all of
the foregoing shall constitute "cash collateral" for purposes of this Agreement.
The Company agrees, to the fullest extent it may effectively do so under
applicable law, that any holder of a participation in the Note may exercise
rights of set-off or counterclaim and other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Company pursuant to this Agreement in the amount of such
participation.
SECTION 8.4. NO WAIVER. The remedies in this ARTICLE VIII are in
addition to, not in limitation of, any other right, power, privilege, or remedy,
either in law, in equity, or otherwise, to which the Lender may be entitled. No
failure or delay on the part of the Lender in exercising any right, power, or
remedy will operate as a waiver thereof, nor will any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any
other right hereunder.
ARTICLE IX. MISCELLANEOUS
-------------------------
SECTION 9.1. AMENDMENTS. No waiver of any provision of this Agreement
or the Note, or consent to departure therefrom, is effective unless in writing
and signed by the Lender. No such consent or waiver extends beyond the
particular case and purpose involved. No amendment to this Agreement is
effective unless in writing and signed by the Company and the Lender.
SECTION 9.2. EXPENSES; DOCUMENTARY TAXES. The Company shall pay (a) all
reasonable out-of-pocket expenses of the Lender, including reasonable fees and
disbursements of special counsel for the Lender, in connection with the
preparation of this Agreement, any waiver or consent hereunder or any amendment
hereof or any Event of Default hereunder and (b) if an Event of Default or
Potential Default occurs, all out-of-pocket expenses incurred by the Lender,
including reasonable fees and disbursements of counsel, in connection with such
Event of Default or Potential Default and collection and other enforcement
proceedings resulting therefrom. The Company shall reimburse the Lender for its
payment of all transfer taxes, documentary taxes, assessments, or charges made
by any governmental authority by reason of the execution and delivery of this
Agreement or the Note.
SECTION 9.3. INDEMNIFICATION. The Company shall indemnify and hold the
Lender harmless against any and all liabilities, losses, damages, costs, and
expenses of any kind (including, without limitation, the reasonable fees and
disbursements of counsel in connection with any investigative, administrative or
judicial proceeding, whether or not the Lender shall be designated a party
thereto) which may be incurred by the Lender relating to or arising out of this
Agreement or any actual or proposed use of proceeds of any Loan hereunder;
provided, that the Lender shall have no right to be indemnified hereunder for
its own bad faith or willful misconduct as determined by a court of competent
jurisdiction. The Company further agrees to indemnify the Lender against any
loss or expense which the Lender may sustain or incur as a consequence of any
default by the Company in payment when due of any amount due hereunder in
respect of any Libor Rate Loan, including, but not limited to, any loss of
profit, premium, or penalty incurred by the Lender in respect of funds borrowed
by it for the purpose of making or maintaining any such Loan, as determined by
the Lender in the exercise of its sole but reasonable discretion. A certificate
as to any such loss or expense shall be promptly submitted by the Lender to the
Company and shall, in the absence of manifest error, be conclusive and binding
as to the amount thereof.
SECTION 9.4. CONSTRUCTION. This Agreement and the Note will be governed
by and construed in accordance with the laws of the State of Ohio, without
regard to principles of conflict of laws. The several captions to different
Sections of this Agreement are inserted for convenience only and shall be
ignored in interpreting the provisions hereof.
SECTION 9.5. EXTENSION OF TIME. Whenever any payment hereunder or under
the Note becomes due on a date which the Lender is not open for the transaction
of business, such payment will be due on the next succeeding Business Day and
such extension of time will be included in computing interest in connection with
such payment.
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SECTION 9.6. NOTICES. All written notices, requests, or other
communications herein provided for must be addressed:
to the Company as follows:
Collaborative Clinical Research, Inc.
00000 Xxxxxxx Xxxx., Xxxxx 0000
Xxxxxxxxx, Xxxx 00000
Attn: Xxxxx X. Black
Vice-President-CEO
to the Lender as follows:
Key Corporate Capital Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000-0000
Attn: Manager Healthcare Finance
or at such other address as either party may designate to the other in writing.
SECTION 9.7. SURVIVAL OF AGREEMENTS; RELATIONSHIP. All agreements,
representations, and warranties made in this Agreement will survive the making
of the extension of credit hereunder, and will bind and inure to the benefit of
the Company and the Lender, and their respective successors and assigns;
PROVIDED, that no subsequent holder of the Note shall by reason of acquiring
that Note become obligated to make any Loan hereunder and no successor to or
assignee of the Company may borrow hereunder without the Lender's written
assent. The relationship between the Company and the Lender with respect to this
Agreement, the Notes and any other Loan Document is and shall be solely that of
debtor and creditor, respectively, and the Lender has no fiduciary obligation
toward the Company with respect to any such document or the transactions
contemplated thereby.
SECTION 9.8. SEVERABILITY. If any provision of this Agreement or the
Notes, or any action taken hereunder, or any application thereof, is for any
reason held to be illegal or invalid, such illegality or invalidity shall not
affect any other provision of this Agreement or the Note, each of which shall be
construed and enforced without reference to such illegal or invalid portion and
shall be deemed to be effective or taken in the manner and to the full extent
permitted by law.
SECTION 9.9. ENTIRE AGREEMENT. This Agreement, the Notes and any other
Loan Document integrate all the terms and conditions mentioned herein or
incidental hereto and supersede all oral representations and negotiations and
prior writings with respect to the subject matter hereof.
SECTION 9.10. JURY TRIAL WAIVER. COMPANY AND LENDER EACH WAIVE ANY
RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN
CONTRACT, TORT OR OTHERWISE, BETWEEN LENDER AND COMPANY ARISING OUT OF, IN
CONNECTION WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT OR ANY NOTE OR OTHER INSTRUMENT,
DOCUMENT OR AGREEMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE
TRANSACTIONS RELATED THERETO. THIS WAIVER SHALL NOT IN ANY WAY AFFECT, WAIVE,
LIMIT, AMEND OR MODIFY LENDER'S ABILITY TO PURSUE REMEDIES PURSUANT TO ANY
CONFESSION OF JUDGMENT OR COGNOVIT PROVISION CONTAINED IN ANY NOTE OR OTHER
INSTRUMENT, DOCUMENT OR AGREEMENT BETWEEN LENDER AND COMPANY.
IN WITNESS WHEREOF, the Company and the Lender have each caused this
Agreement to be executed by their duly authorized officers as of this 1st day of
October, l997.
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COMPANY: COLLABORATIVE CLINICAL RESEARCH,
BY: /s/ Xxxxxxx X. Xxxxx
--------------------------------------------
TITLE: President & CEO
-----------------------------------------
LENDER: KEY CORPORATE CAPITAL INC.
BY: /s/ Xxxxx X. Xxxxx
--------------------------------------------
TITLE: Vice President
-----------------------------------------
17
