34
CREDIT AGREEMENT
Dated as of June 28, 2001
TRANSACTION SYSTEMS ARCHITECTS, INC., a Delaware corporation ("TSA") and ACI
WORLDWIDE INC., a Nebraska corporation ("ACI") (TSA and ACI are sometimes
hereinafter individually and collectively referred to as the "Borrower"), and
U.S. BANK NATIONAL ASSOCIATION, a national banking association (the "Bank"),
hereby agree as follows:
ARTICLE I
AMOUNTS AND TERMS OF ADVANCES
SECTION 1.01. COMMITMENT AND ADVANCES
(A) Commitment. The Bank agrees, on the terms and conditions hereinafter set
forth, to make advances (the "Advances") to the Borrower from time to time
during the period from the date hereof to and including June 27, 2002 (the
"Termination Date") in an aggregate amount not to exceed at any time outstanding
the sum of Twenty-Five Million Dollars ($25,000,000) (the Bank's obligation to
make such Advances under the terms of this Agreement is hereinafter referred to
as the "Commitment"). Within the limits of the Commitment, the Borrower may
borrow, repay pursuant to Section 1.04, and reborrow under this Section 1.01(A).
(B) Purpose of Advances. The Advances shall be used only for working capital and
general corporate purposes of the Borrower.
(C) Recordation of Amount of Advances. In the absence of manifest error, the
books and records of the Bank shall be conclusive and binding upon the Borrower
as to the principal balance of the Advances outstanding at any time and the
amount of accrued interest.
SECTION 1.02. MAKING ADVANCES.
(A) Advance Requests. Each Advance shall be made on written notice from the
Borrower to the Bank signed by Xxxxx X. Xxxxxxx, Xxxxxx X. Xxxxxx, Xxxxxx X.
Xxxx, or Xxxxx X. Xxxxxx, or such other person or persons as the Borrower may
from time to time designate in writing to the Bank (such persons are hereinafter
referred to as "Designated Individuals") delivered before 12:00 p.m. (Omaha,
Nebraska time) on a Business Day (as defined below) specifying the amount of
such Advance, the interest rate applicable thereto under Section 1.04, and, for
each LIBOR Rate Advance, the Interest Period applicable thereto (each such
notice is hereinafter referred to as an "Advance Request"); provided, however,
that:
(1) Any Advance Request for a LIBOR Rate Advance (as defined below)
shall be delivered to the Bank not later than 12:00 p.m. (Omaha,
Nebraska time) at least two New York Banking Days preceding the first
day of the Interest Period applicable to such LIBOR Rate Advance; and
(2) The Bank may, in its discretion, make Advances at the Index-Based
Rate pursuant to verbal requests (whether in person or by telephone)
from any of the Designated Individuals, provided, that: (a) the
Borrower shall confirm such verbal request in writing promptly after
making such verbal request, and (b) the Bank shall have no liability to
the Borrower or any other person with respect to Advances made by the
Bank in good faith pursuant to any such verbal request.
(B) Availability of Advances. Subject to the advance notification requirements
for a LIBOR Interest Period set forth in Section 1.02(A)(1), not later than 2:30
p.m. (Omaha, Nebraska time) on the date of such Advance Request (or, in the case
of a LIBOR Rate Advance, on the second New York Banking Day following the date
of such Advance Request) and upon fulfillment of the applicable conditions set
forth in Article II, the Bank will make such Advance available to the Borrower
in same day funds by depositing such Advance in an account maintained by the
Borrower at the Bank, at the Bank's address referred to in Section 6.02. The
Bank may rely without further investigation on the information set forth in any
Advance Request.
(C) Minimum Amounts. Each LIBOR Rate Advance (as defined below) shall be in the
minimum amount of $1,000,000 or an integral multiple of $500,000 in excess
thereof. Each Index Rate Advance (as defined below) shall be in the minimum
amount of $10,000 or any integral multiple of $5,000 in excess thereof.
SECTION 1.03. BORROWING BASE REPORTING.
(A) Borrowing Base Defined. As used in this Agreement, the "Borrowing Base"
shall be an amount equal to seventy-five percent (75%) of Eligible Domestic
Accounts, plus (2) zero percent (0%) of Eligible Foreign Accounts. From time to
time as required herein, the Borrower shall deliver to the Bank a certificate in
substantially the form of Exhibit "A" attached hereto, signed by the chief
financial officer of the Borrower, setting forth the information and
calculations necessary for the determination of the Borrowing Base (each, a
"Borrowing Base Certificate").
(B) Eligible Accounts Defined; Exclusions. "Eligible Domestic Accounts" shall
consist solely of trade accounts of the Borrower and the Borrower's subsidiaries
listed on Schedule 1.03(B) attached hereto (collectively, the "Primary
Subsidiaries") with respect to account debtors located in the United States, for
which invoices have been delivered to the respective account debtors, which
accounts have been created in the ordinary course of the business and upon which
the right to receive payment is absolute and not contingent upon the fulfillment
of any condition whatsoever. "Eligible Foreign Accounts" shall consist solely of
those trade accounts of the Borrower and the Primary Subsidiaries with respect
to account debtors located outside of the United States, which accounts have
been created in the ordinary course of business and upon which the right to
receive payment is absolute and not contingent upon the fulfillment of any
condition whatsoever. Notwithstanding the foregoing, the following shall not be
included in either Eligible Domestic Accounts or Eligible Foreign Accounts:
(1) Any Eligible Domestic Account which is more than one hundred twenty
(120) days past invoice date, unless such account is supported by a
letter of credit acceptable to the Bank;
(2) Any Eligible Foreign Account which is more than ninety (90) days
past invoice date, unless such account is supported by a letter of
credit acceptable to the Bank;
(3) Any Eligible Domestic Account if more than twenty-five percent
(25%) of the aggregate amount of accounts of such customer have at the
time remained unpaid for more than one hundred twenty (120) days after
invoice date;
(4) Any Eligible Foreign Account if more than twenty-five percent (25%)
of the aggregate amount of accounts of such customer have at the time
remained unpaid for more than ninety (90) days after invoice date;
(5) any account for which there exists any right of setoff, defense or
discount (except regular discounts allowed in the ordinary course of
business to promote prompt payment) or for which any defense or
counterclaim has been asserted; provided, however, in cases where the
account debtor has a contractual right of setoff against an account
owed by such debtor to the Borrower or the Primary Subsidiaries (which
right of offset is not disputed by Borrower or the Primary
Subsidiaries), such account shall only be excluded under this Section
1.03(B)(2) to the extent of the setoff claimed by the account debtor;
(6) any account which arises from the sale or lease to or
performance of services for, or represent an obligation of, an
employee, affiliate, parent or subsidiary;
(7) customer clearing accounts, bank overdrafts, and outstanding
checks or drafts;
(8) accounts subject to any Factoring Agreement (as defined
below); and
(9) any account deemed ineligible by the Bank in its reasonable
discretion based on the creditworthiness of the account debtor, as
determined by the Bank in a manner generally consistent with similar
determinations made by the Bank from time to time.
SECTION 1.04. REPAYMENT AND INTEREST.
(A) Repayment. The Borrower shall repay the aggregate unpaid principal amount of
all Advances, with interest thereon as provided herein, in accordance with the
terms of this Agreement and the Promissory Note of the Borrower in substantially
the form of Exhibit "B" attached hereto (the "Note").
(B) Interest Rate Options. Interest on each Advance hereunder shall accrue from
the date of such Advance until such Advance is paid in full at one of the
following per annum rates selected by Borrower in the applicable Advance
Request:
(1) The prime rate announced by the Bank from time to time, as and when
such rate changes (the "Index Rate"), less One-Quarter of One Percent
(0.25%) (the "Index-Based Rate"); or
(2) Subject to the advance notification requirements set forth in
Section 1.02(A)(1), the 1, 2, 3 or 6 month LIBOR rate quoted by the
Bank from Telerate Page 3750 or any successor thereto (which shall be
the LIBOR rate in effect two New York banking days prior to
commencement of the LIBOR Rate Advance)(the "LIBOR Rate") plus One and
Three-Quarters Percent (1.75%) (the "LIBOR-Based Rate").
The Bank's internal records of applicable interest rates shall be determinative
in the absence of manifest error. Advances to which the Index-Based Rate are
applicable are referred to herein as "Index Rate Advances", and Advances to
which the LIBOR-Based Rate are applicable are referred to herein as "LIBOR Rate
Advances."
(C) Payment of Interest. Interest on Advances shall be payable as follows: (1)
for all Index Rate Advances, interest shall be payable monthly in arrears; and
(2) for all LIBOR Rate Advances, interest shall be payable at the earlier to
occur of: (a) the next Quarterly Payment Date, or (b) the end of the applicable
Interest Period. All accrued interest remaining unpaid on all Advances shall be
due on the Termination Date.
(D) Payment of Principal. Principal of all Index-Rate Advances shall be due and
payable in full on the Termination Date. Principal of all LIBOR Rate Advances
shall be due and payable at the end of the applicable Interest Period, but in no
event later than the Termination Date.
(E) Prepayment. The Borrower may prepay any Index Rate Advance, in whole or in
part, at any time and without penalty. The Borrower may not prepay any LIBOR
Rate Advance prior to the expiration of the then-applicable Interest Period
without the express written consent of the Bank, which the Bank will not grant
except upon the terms and subject to the conditions hereinafter provided.
Lender's consent to the prepayment of any LIBOR Rate Advance prior to the end of
the then-applicable Interest Period shall be conditioned upon the following:
(1) The Borrower shall have given to the Bank not less than five days
prior written notice of the Borrower's intent to prepay such LIBOR Rate
Advance, specifying the amount to be prepaid and the date of
prepayment;
(2) Any prepayment of a LIBOR Rate Advance shall be in an amount equal
to the remaining entire principal balance of such LIBOR Rate Advance.
(3) Together with such prepayment, the Borrower shall pay all
Breakage Costs (as defined below).
(F) Breakage Costs. In connection with the prepayment of any LIBOR Rate Advance
prior to the last business day of the applicable Interest Period, whether as a
result of a voluntary prepayment or due to acceleration upon default or
otherwise, the Borrower agrees to pay all of the Bank's costs, expenses and the
Interest Differential (as determined by the Bank) incurred as a result of such
prepayment (collectively, "Breakage Costs"). The term "Interest Differential"
shall mean that sum equal to the greater of zero (0) or the financial loss
incurred by the Bank resulting from prepayment, calculated as the difference
between the amount of interest the Bank would have earned (from like investments
as of the first day of the LIBOR Rate Advance) had prepayment not occurred and
the interest the Bank will actually earn (from like investments as of the date
of prepayment) as a result of the redeployment of funds from the prepayment.
Because of the short-term nature of this facility, the Borrower agrees that the
Interest Differential shall not be discounted to its present value.
(G) Failure to Select Interest Rate Option or Interest Period. In the event that
no rate is selected in an Advance Request, the applicable interest rate shall be
deemed to be the Index-Based Rate. In the event that any Advance Request
specifies a LIBOR Rate Advance but fails to specify an Interest Period, the
Interest Period applicable to such LIBOR Rate Advance shall be deemed to be one
month. In the event that the Borrower does not timely select an interest rate
option at least two banking days before a LIBOR Rate Advance expires and such
Advance is not paid in full at the expiration of such Interest Period, such
LIBOR Rate Advance shall automatically be converted to an Index Rate Advance,
such conversion being effective as of the expiration of the Interest Period for
such LIBOR Rate Advance.
(H) Interest Period for LIBOR Rate Advances. The interest period of 1, 2, 3 or 6
months for any LIBOR Rate Advance, as selected by Borrower in the applicable
Advance Request (each, an "Interest Period"), shall begin on the date of such
LIBOR Rate Advance and end on the last day of such Interest Period, provided,
however, that no Interest Period shall extend beyond the Termination Date.
(I) Unavailability of LIBOR Rate. Notwithstanding anything to the contrary
contained herein, if on any date on which a LIBOR Based Rate is to be determined
pursuant hereto, the Bank determines that deposits in U.S. dollars are not being
offered in the relevant amounts or for the relevant maturities to its lending
office in the London interbank dollar market and/or the LIBOR Rate is otherwise
not determinable for any reason whatsoever and/or the LIBOR Rate does not
accurately cover the cost to the Bank of making or maintaining such type of
Advances, then the Bank's obligation to make LIBOR Rate Advances shall be
suspended until the Bank notifies the Borrower that the circumstances giving
rise to such suspension no longer exist. The Borrower shall pay interest on the
unpaid principal amount of each Advance made during the period of any such
suspension from the date of such Advance until such principal amount is paid in
full, payable on the last day of each calendar month during such period at a
fluctuating interest rate equal to the Index-Based Rate (as defined below).
(J) Changes In Index Rate. Changes in the Index Based Rate shall be
effective immediately upon the corresponding change in the Index Rate.
(K) Default Rate. Upon the occurrence of an Event of Default, the Borrower shall
pay interest on demand at the Default Rate on the principal amount of all
Advances outstanding until the date such Advances are paid in full. The "Default
Rate" is a fluctuating rate equal to 2% per annum above the then-applicable
Index Rate.
(L) Usury. It is the intention of the Bank and the Borrower hereof that the Note
and this Agreement and all provisions hereof and of all documents securing the
Note conform in all respects to applicable law so that no payment of interest or
other sum construed to be interest shall exceed the highest lawful rate
permissible. In determining the rate of interest paid or payable under this
Agreement and the Note or any of the loan Documents, all funds paid or to be
paid as interest or construed to be interest shall be prorated, allocated, or
spread as permitted under applicable law. If, through any circumstances, the
contract of the Borrower and the Bank would result in payment, receipt or
reservation of sums exceeding the highest lawful interest rate applicable to
this transaction, or if the Borrower pays or lender receives or reserves any sum
as interest or construed to be interest in excess of such rate, then, ipso
facto, (1) the amount contracted for shall be automatically reduced to the
highest lawful rate authorized for this transaction, and (2) the amount of
excess interest paid shall be applied to the reduction of the principal balance
of the Note, if any, and if the principal balance has been fully paid, the
excess interest shall be refunded to the Borrower and the Borrower agrees to
accept such refund. Thereupon, to the extent permitted by law, the Bank shall
not be subject to any penalty provided for the contracting for, charging, or
receiving of interest in excess of such highest lawful rate, regardless of when
or the circumstances under which such refund or application was made.
SECTION 1.05. [RESERVED].
SECTION 1.06. PAYMENTS AND COMPUTATIONS. The Borrower shall make each payment
hereunder and under the Note not later than 12:00 noon (Omaha, Nebraska time) on
the day when due in lawful money of the United States of America to the Bank at
its address referred to in Section 6.02 in same day funds. All computations of
interest and fees hereunder and under the Note shall be made by the Bank on the
basis of a year of 360 days for the actual number of days (including the first
day but excluding the last day) elapsed.
SECTION 1.07. PAYMENT ON NONBUSINESS DAYS. Whenever any payment to be made
hereunder or under the Note shall be stated to be due on a Saturday, Sunday or a
public or bank holiday in Omaha, Nebraska (any other day being a "Business
Day"), such payment may be made on the next succeeding Business Day (except that
in the case of a LIBOR Rate Advance where the next succeeding Business Day falls
in the next succeeding calendar month, then such payment shall be made on the
next preceding Business Day with interest adjusted accordingly), and such
extension of time shall in such case be included in the computation of payment
of interest or commitment fee, as the case may be.
SECTION 1.08. COMMITMENT FEE. The Borrower agrees to pay to the Bank a
commitment fee ("Commitment Fee") on the average daily unused portion of the
Commitment from the date hereof at the rate of one quarter of one percent
(0.25%) per annum payable in arrears on each Quarterly Payment Date and on the
Termination Date.
ARTICLE II
CONDITIONS PRECEDENT
SECTION 2.01. CONDITION PRECEDENT TO INITIAL ADVANCE. The obligation of the Bank
to make its initial Advance is subject to the condition precedent that the Bank
shall have received at least two Business Days before the day of such Advance
the following, each in form and substance satisfactory to the Bank:
(A) Loan Documents. The following documents, duly executed (and
acknowledged, if required by form) by all parties thereto (collectively, the
"Loan Documents"):
(1) This Agreement;
(2) The Note;
(3) Pledge Agreements from TSA and ACI, each in substantially
the form attached hereto as Exhibit C" (the "Pledge Agreements");
(4) Security Agreements of the Borrower and each of the Primary
Subsidiaries, in substantially the form attached hereto as Exhibit
"D" (the "Security Agreements");
(5) Acknowledgement copies of proper Financing Statements (Form UCC-1)
of the Borrower and each of the domestic Primary Subsidiaries duly
filed under the Uniform Commercial Code of all jurisdictions as may be
necessary or, in the opinion of the Bank, desirable to perfect the
security interests created by the Security Agreements to which such
domestic Primary Subsidiaries are a party (collectively, the "Financing
Statements");
(6) Guaranties of each of the Primary Subsidiaries, substantially in
the form of Exhibit "E" attached hereto, pursuant to which such Primary
Subsidiaries unconditionally guarantee the prompt payment and
performance of all obligations of the Borrower under the Loan Documents
(collectively, the "Guaranties").
(B) UCC Searches. Certified copies of Requests for Information (Form UCC-11), or
equivalent reports, listing the Financing Statements and all other effective
financing statements which name the Borrower (under its present name and any
previous name) or any of the Primary Subsidiaries as debtor and which are filed
in the jurisdictions in which the Financing Statements are to be filed, together
with copies of such other financing statements (none of which shall cover the
collateral purported to be covered by the Security Agreements);
(C) Evidence of Insurance. Evidence of the insurance required by the
terms of the Loan Documents;
(D) Evidence of Actions Relating to Security Interests. Evidence that
all other actions necessary or, in the opinion of the Bank, desirable to
create, perfect and protect the security interests created by the Loan
Documents have been taken;
(E) Resolutions. Certified copies of the resolutions of the board of directors
(or other governing body, as appropriate) of the Borrower and each of the
Primary Subsidiaries approving each Loan Document to which it is a party and
certified copies of all documents evidencing other necessary action and
governmental approvals, if any, with respect to such Loan Document.
(F) Incumbency Certificate. A certificate of the Secretary of the Borrower
certifying the names, titles, and true signatures of the President or other
officers of the Borrower authorized to sign each Loan Document and the other
documents to be delivered by it hereunder, together with similar documentation
for each of the Primary Subsidiaries.
(G) Opinion. A favorable opinion of Xxxxxxxx & Xxxxxxxxxx, P.C., counsel for the
Borrower, substantially the form of Exhibit "F" as to: (1) the existence and
authority of the Borrower and each Primary Subsidiary organized under the laws
of any of the United States (the "Domestic Subsidiaries"); (2) the
enforceability of each Loan Document to which the Borrower or any of the
Domestic Subsidiaries is a party against the Borrower or such Domestic
Subsidiary, as applicable, and (3) such other matters as the Bank may reasonably
request.
(H) Intercreditor Agreements. The original, fully-executed Intercreditor
Agreement among the Bank, the Borrower, and Fleet, in substantially the form
attached hereto as Exhibit "G".
(I) Collateral Inspection. The Bank shall have conducted an examination of all
collateral described in the Loan Documents, with the results of such examination
being acceptable to the Bank.
(J) Certificates. The Bank shall have received a Borrowing Base Certificate and
Compliance Certificate satisfactory to the Bank.
SECTION 2.02. CONDITIONS PRECEDENT TO ALL ADVANCES. The obligation of the Bank
to make each Advance (including the initial Advance) shall be subject to the
further conditions precedent that on the date of such Advance:
(A) Accuracy of Representations, Etc.; No Default. The following statements
shall be true (and the submission of each Advance Request and receipt by the
Borrower of any proceeds of such Advance shall be deemed to constitute a
representation and warranty by the Borrower that such statements are true on
such date):
(1) The representations and warranties contained in Article III of this
Agreement and the other Loan Documents are correct on and as of the
date of such Advance as though made on and as of such date;
(2) no event has occurred and is continuing, or would result from such
Advance, which constitutes an Event of Default (as defined in Section
5.01 hereof) or would constitute an Event of Default but for any
requirement that notice be given or time elapse or both.
(B) Other Approvals. The Bank shall have received such other approvals,
opinions or documents as the Bank may reasonably request.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER. The Borrower
represents and warrants to the Bank as follows:
(A) Organization. TSA is a corporation duly formed, validly existing and in good
standing under the laws of the state of Delaware. ACI is a corporation duly
formed, validly existing and in good standing under the laws of Nebraska. Each
of the Primary Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its organization. Each of TSA and
the Primary Subsidiaries are authorized to transact business in the State of
Nebraska (or the failure to be so authorized will not have a material adverse
effect on the obligations of such parties under the Loan Documents). Each of TSA
and the Primary Subsidiaries have obtained all licenses, authorizations and
permits required under applicable law for the conduct of its business in each
jurisdiction in which such licensure or permitting is required.
(B) Power and Authority. The Borrower and each of its subsidiaries (including
the Primary Subsidiaries) have all necessary power and authority to conduct
their respective businesses as presently conducted. The execution, delivery and
performance by the Borrower and each of the Primary Subsidiaries of each Loan
Document to which it is or will be a party are within the powers of the Borrower
and such Primary Subsidiary, have been duly authorized by all necessary action,
do not contravene:
(1) The articles of incorporation or bylaws (or other formation
and operation documents and agreements) of the Borrower or such
Primary Subsidiary, or
(2) any law or any contractual restriction binding on or
affecting the Borrower or such Primary Subsidiary.
Such execution, delivery and performance do not result in or require the
creation of any lien, security interest or other charge or encumbrance (other
than pursuant thereto) upon or against the Borrower or any such Primary
Subsidiary or with respect to any of their respective properties.
(C) No Authorization Required. No authorization or approval or other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by the Borrower and
the Primary Subsidiaries of any Loan Document to which it is a party.
(D) Binding Obligations. This Agreement is, and each other Loan Document to
which the Borrower or any Primary Subsidiary is or will be a party when
delivered hereunder will be, legal, valid and binding obligations of the
Borrower and such Primary Subsidiary, respectively enforceable against the
Borrower and such Primary Subsidiary, respectively in accordance with their
respective terms.
(E) Financial Statements. The Borrower has heretofore delivered to the Bank a
copy of TSA's: (i) Annual Report on Form 10-K for the fiscal year ended as of
September 30, 2000; (ii) Quarterly Report on Form 10-Q for the quarterly periods
ended December 31, 2000 and March 31, 2001 (the "TSA Reports"). The financial
statements contained in the TSA Reports were prepared on a consolidated basis in
accordance with generally accepted accounting principles on a basis consistent
with that of the previous fiscal year or period (hereinafter, "GAAP"), except
where otherwise noted in the financial statements, and fairly reflect the
financial position of the Borrower and all of its subsidiaries as of the date
thereof, and the results of the respective operations for the Borrower and its
subsidiaries for the period covered thereby. Neither the Borrower nor any of its
subsidiaries has any significant known contingent liabilities other than as
indicated on said financial statements, and since said date of March 31, 2001,
there has been no material adverse change in the condition, financial or
otherwise, of the Borrower or any of its subsidiaries.
(F) No Liens, Etc. Except for a portion of receivables which have been factored
by the Borrower in the ordinary course of business pursuant to an existing
factoring agreement dated March 31, 2000 (the "Fleet Factoring Agreement"),
between the Borrower and Fleet Business Credit Corporation ("Fleet"), none of
the assets of the Borrower is subject to any mortgage, pledge, title retention
lien, or other lien, encumbrance or security interest, except for: (a) current
taxes not delinquent or taxes being contested as provided by law in good faith
and by appropriate legal proceedings; (b) liens arising in the ordinary course
of business for sums not due or sums being contested in good faith and by
appropriate legal proceedings, but not involving any deposits or advances of
borrowed money or the deferred purchase price of property or services; and (c)
to the extent specifically shown in the financial statement referred to above.
(G) Other Restrictions. Neither the Borrower nor any of its subsidiaries is a
party to any agreement or instrument, or subject to any charter or other
corporate restriction, nor subject to any judgment, decree or order of any court
or governmental body, which the Borrower knows or reasonably should know may
have a material and adverse effect on the business, assets, liabilities,
financial condition, or operations of the Borrower or such subsidiary, or the
obligations of the Borrower under the Loan Documents. Except as disclosed in
Schedule 3.01(G) attached hereto, the Borrower has no, nor with reasonable
diligence should have had, knowledge of or notice that the Borrower or any of
its subsidiaries is in default with respect to the performance, observance or
fulfillment of any obligations, covenants or conditions contained in any
agreement, instrument, charter or other corporate restriction, judgment, decree
or order of any court or governmental body that might have a material adverse
impact on the Borrower or its subsidiaries.
(H) No Transfer of Assets. Except for: (1) transfers in the ordinary course of
business, (2) transfers made pursuant to the Fleet Factoring Agreement described
above, and (3) those transfers disclosed in Schedule 3.01(H) attached hereto,
neither the Borrower nor any of its subsidiaries has sold, conveyed,
transferred, disposed of, or otherwise further encumbered, any material amount
of their respective assets within the last ninety (90) days.
(I) No Litigation. There is no pending or threatened action or proceeding
affecting the Borrower or any of its subsidiaries before any court, governmental
agency or arbitrator, which, if adversely determined, would result in a material
adverse effect on the financial condition or operations of the Borrower or any
of its subsidiaries, except as disclosed in Schedule 3.01(I) attached hereto.
(J) Use of Proceeds. No proceeds of any Advance will be used to acquire any
security in any transaction which is subject to Sections 13 and 14 of the
Securities Exchange Act of 1934.
(K) Margin Stock. Neither the Borrower nor any of its subsidiaries is engaged in
the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation U issued by the Board of
Governors of the Federal Reserve System), and no proceeds of any Advance will be
used to purchase or carry any margin stock or to extend credit to others for the
purpose of purchasing or carrying any margin stock.
(L) Status Under Investment Company Act. None of the Borrower or its
subsidiaries are an "investment company" or a company "controlled" by an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(M) No Violation of Environmental Laws. The Borrower has not received notice of,
nor knows of, nor suspects any facts which might constitute any violations by
the Borrower or its subsidiaries of any federal, state and local, environmental,
health, and safety laws, codes and ordinances in all rules and regulations
promulgated thereunder (hereinafter collectively referred to as "Environmental
Laws") with respect to the business, operations, assets, equipment, property,
leaseholds or other facilities of the Borrower or its subsidiaries. There is no
present violation of Environmental Laws with respect to any property owned,
leased, or occupied by the Borrower or its subsidiaries.
(N) Taxes. The Borrower and each of its subsidiaries have: (1) timely filed all
state, federal, local and foreign tax returns which it is obligated to file, and
(2) paid when due all taxes and other impositions of any nature whatsoever
imposed by any federal, state or foreign government or other authority, on or
with respect to the Borrower or its subsidiaries or any of their respective
properties, including, without limitation, all income taxes, ad valorem property
taxes, sales and use taxes, excise taxes, and general or special assessments.
(O) ERISA. The Borrower and all of its subsidiaries are in compliance in all
material respects with the Employee Retirement Income Security Act of 1974, as
amended, and all regulations promulgated thereunder (collectively, "ERISA") to
the extent applicable to the Borrower and its subsidiaries, except for any
noncompliance which could not reasonably be expected to result in any material
adverse change in the properties, business or operations of the Borrower.
Borrower has received no notice to the contrary from the Pension Benefits
Guaranty Corporation ("PBGC") or any other governmental agency.
ARTICLE IV
COVENANTS
SECTION 4.01. AFFIRMATIVE COVENANTS OF THE BORROWER. So long as any amount
payable hereunder or under the Note shall remain unpaid or the Bank shall have
any Commitment hereunder, the Borrower will (and, to the extent applicable, will
cause each of its subsidiaries to):
(A) Corporate Existence, Etc. Preserve and maintain its corporate existence and
keep in force and effect all licenses, permits and franchises necessary and
material to the proper conduct of its business; maintain, preserve and keep its
property, plant and equipment, including, without limitation, all tangible and
intangible assets, in good repair, working order and condition.
(B) Compliance With Laws, Etc. Comply in all material respects with all
applicable laws, rules, regulations and orders, including without limitation,
all applicable Environmental Laws and ERISA, such compliance to include, without
limitation, paying before the same become delinquent all taxes, assessments and
governmental charges imposed upon it or upon its property prior to the initial
Advance hereunder and thereafter except to the extent contested in good faith.
(C) Visitation Rights; Collateral Examination. Permit the Bank or any agents or
representatives thereof to examine and make copies of abstracts from the records
and books of account of, and visit the properties of the Borrower and its
subsidiaries, conduct field collateral examinations at the expense of the
Borrower and at any reasonable time and from time to time discuss the affairs,
finances and accounts of the Borrower and its subsidiaries with any of their
respective officers or directors.
(D) Reporting Requirements. Furnish to the Bank:
(1) as soon as available and in any event within 50 days after the end
of each fiscal quarter of TSA, a copy of the consolidated financial
statements (including balance sheets, statements of income and cash
flows, all accompanying notes thereto and management letters) for the
Borrower and all of its subsidiaries for such quarter, prepared on a
consolidated basis in accordance with GAAP, reviewed in accordance with
Statement on Accounting Standards No. 71 by Xxxxxx Xxxxxxxx or other
independent certified public accountants reasonably acceptable to the
Bank, together with related 10-Q filings made with the Securities and
Exchange Commission (the "SEC"), which documents shall be sent directly
by such accountants to the Bank (provided, however, that to the extent
such documentation is available for downloading by the Bank through the
SEC's XXXXX database, and the Bank has received from such accountants
all remaining documentation required under this paragraph, the delivery
requirement of this Section 4.01(D)(1) shall be deemed satisfied);
(2) as soon as available and in any event within 100 days after the end
of each fiscal year of TSA, a copy of the consolidated financial
statements (including balance sheets, statements of income and cash
flows, all accompanying notes thereto and management letters) for the
Borrower and all of its subsidiaries for such year, prepared on a
consolidated basis in accordance with GAAP, audited and certified
without qualification by Xxxxxx Xxxxxxxx or other independent certified
public accountants reasonably acceptable to the Bank, together with
related 10-K filings made with the SEC; which documents shall be sent
directly by such accountants to the Bank (provided, however, that to
the extent such documentation is available for downloading by the Bank
through the SEC's XXXXX database, and the Bank has received from such
accountants all remaining documentation required under this paragraph
together with a letter from such accountants to the Bank indicating
that the information available through XXXXX has been audited and
certified by such accountants as provided herein, the delivery
requirement of this Section 4.01(D)(2) shall be deemed satisfied);
(3) promptly after the filing or receiving thereof, copies of all
reports and notices which the Borrower or any of its subsidiaries files
under ERISA with the Internal Revenue Service or the PBGC or the U.S.
Department of Labor or which the Borrower or any of its subsidiaries
receives from such entities;
(4) as soon as available and in any event within thirty (30) days after
the end of each Quarterly Payment Date, unless requested more often by
the Bank, a duly completed Borrowing Base Certificate setting forth the
Borrowing Base as of such Quarterly Payment Date;
(5) promptly upon the completion of each fiscal quarter, a compliance
certificate, in substantially the form of Exhibit "H" attached hereto
(each, a "Compliance Certificate"), setting forth the Borrower's
calculations of its Consolidated Tangible Net Worth, Consolidated
Working Capital, and Consolidated EBITDAR (each as defined below),
signed by the Chief Financial Officer of the Borrower.
(6) promptly, upon the occurrence of an Event of Default or an event
that but for the passage of time or the giving of notice or both would
constitute an Event of Default, notice of such Event of Default or
event;
(7) promptly, upon the occurrence or claimed occurrence of a default,
breach or event of default under any note or any other evidence of
indebtedness or agreement of the Borrower or any subsidiary (or any
event that but for the passage of time or the giving of notice or both
would constitute a default) under any other agreement to which the
Borrower or any of its subsidiaries is a party pursuant to which the
obligations or liabilities (or claimed obligations or liabilities) of
the Borrower or such subsidiary are in excess of $1,000,000, notice of
such occurrence, default, event or claim;
(8) promptly, upon filing of, or receipt of notice or service thereof,
notice of any litigation filed by or against the Borrower or any of its
subsidiaries (including the Primary Subsidiaries), where the amount in
question exceeds $1,000,000, or which could have a material adverse
effect on the ability of the Borrower or such subsidiary to perform its
obligations under the Loan Documents to which it is a party;
(9) if requested by the Bank, (a) a listing of all accounts, notes
receivable and inventory of the Borrower and its subsidiaries, and (b)
listing of all of accounts payable of the Borrower and its
subsidiaries, all of the foregoing certified by the chief financial
officer of the Borrower;
(10) promptly, upon the occurrence or claimed occurrence of any event
(including, without limitation, any default, breach or event of
default) which, under the terms of any Factoring Agreement, could
result in any obligation of the Borrower to Fleet or claim for damages
by Fleet against the Borrower in excess of $1,000,000.
(11) such other information respecting the condition or operations,
financial or otherwise, of the Borrower and its subsidiaries as the
Bank may from time to time reasonably request; and
(E) Net Worth. Maintain at all times a Consolidated Tangible Net Worth of not
less than $140,000,000. "Consolidated Tangible Net Worth" means the total
stockholders' equity of the Borrower and the Primary Subsidiaries, minus the
amount of all intangibles, and excluding "accumulated other comprehensive
income," all as determined in accordance with GAAP.
(F) Working Capital. Maintain at all times a minimum Consolidated Working
Capital of $60,000,000. "Consolidated Working Capital" means the excess of
current assets of the Borrower and the Primary Subsidiaries over current
liabilities of the Borrower and the Primary Subsidiaries, current assets and
current liabilities each to be determined in accordance with GAAP.
(G) EBITDAR. Maintain at all times a minimum Consolidated EBITDAR of
$40,000,000. "Consolidated EBITDAR" means for any period, the total of the
following each calculated without duplication for the Borrower and the Primary
Subsidiaries on a consolidated basis for such period: (i) net income from
operations; plus (ii) any provision for (or less any benefit from) income taxes
included in determining such net income; plus (iii) interest expense deducted in
determining such net income; plus (iv) amortization and depreciation expense
deducted in determining such net income; plus (v) rental expense deducted in
determining such net income; plus (vi) other extraordinary non-cash charges
(such as writing off good will), plus (vii) for measurement periods ending no
later than September 30, 2001, certain extraordinary cash charges shown on
Schedule 4.01(G) not to exceed $6,500,000 in the aggregate as they are incurred;
in each case determined in accordance with GAAP to the extent applicable.
Consolidated EBITDAR shall be measured quarterly based upon the four quarter
period then ended.
(H) GAAP. Maintain a standard accounting system in accordance with GAAP.
(I) Insurance. In addition to and without limiting any insurance requirements in
the Loan Documents, maintain and keep in force insurance of the types and in the
amounts customarily carried in lines of business similar to the Borrower's (and
its subsidiaries'), including but not limited to fire, extended coverage, public
liability and property damage, carried with companies and in amounts
satisfactory to the Bank. Schedules setting forth all insurance then in effect
shall be delivered to the Bank from time to time at the Bank's request; cause
the Bank to be named as loss payee on all such insurance relating to the
collateral described in the Loan Documents; cause such policies of insurance to
provide that any policy may not be cancelled or terminated without the insurance
company giving the Bank at least 15 days written notice; and, within 30 days
after notice in writing from the Bank, obtain such additional insurance as the
Bank may reasonably request.
(J) Additional Guaranties. As requested by the Bank, cause Borrower's
majority-owned subsidiaries (whether now existing or hereafter created by the
Borrower) to execute and deliver to the Bank an unconditional guaranty
substantially in the form attached hereto as Exhibit "E".
(K) Accounts. Maintain the primary operating accounts of the Borrower
and its subsidiaries with the Bank.
SECTION 4.02. NEGATIVE COVENANTS OF THE BORROWER. So long as any amount payable
hereunder or under the Note shall remain unpaid or the Bank shall have any
Commitment hereunder, the Borrower will not (nor will it permit any of its
subsidiaries to):
(A) Liens, Etc. Create or suffer to exist any lien, security interest or other
charge or encumbrance, or any other type of preferential arrangement, upon or
with respect to any properties of the Borrower or its subsidiaries, whether now
owned or hereafter acquired, or assign any right to receive income, in each case
to secure any Debt. "Debt" means (A) indebtedness for borrowed money or for the
deferred purchase price of property or services, (B) obligations as lessee under
leases which shall have been or should be, in accordance with GAAP, recorded as
capital leases, (C) obligations under direct or indirect guaranties in respect
of, and obligations (contingent or otherwise) to purchase or otherwise acquire,
or otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clause (A) or (B) above, and
(D) liabilities in respect of unfunded vested benefits under plans covered by
Title IV of the Employee Retirement Income Security Act of 1974 ("ERISA").
(B) Dividends, Etc. Declare or pay any dividends, purchase or otherwise acquire
for value any of its stock, preferred or otherwise, now or hereafter
outstanding, or make any distribution of assets to its shareholders in excess of
$100,000 per year.
(C) Debt. Create, incur, assume or permit to exist any Debt or any other
liabilities or obligations, whether matured or unmatured, liquidated or
unliquidated, direct or contingent, joint or several, except (1) the liabilities
of the Borrower to the Bank for money borrowed hereunder, (2) those trade
payables incurred in the ordinary course of business, (3) unsecured indebtedness
of the Borrower and its subsidiaries in amounts not exceeding $5,000,000 in the
aggregate, and (4) those obligations set forth on Schedule 4.02(D).
(D) Other Expenditures. Incur capital expenditures, lease obligations (whether
classified as capital or operating leases) or other expenditures resulting in an
aggregate amount of expenditures for the Borrower and its subsidiaries in any
fiscal year in excess of $5,000,000.
(E) Merger, Consolidation, Acquisitions, Transfers of Assets. Without the prior
written consent of the Bank (which consent shall not be unreasonably withheld or
delayed), merge into or consolidate with any corporation or other entity; make
any substantial change in the nature of the business of the Borrower or its
subsidiaries or recapitalize, reclassify or repurchase any of stock of the
Borrower or its subsidiaries, acquire any other enterprise or entity or all or
substantially all of the assets of any other entity; sell, lease, assign,
transfer or otherwise dispose of all or substantially all of the assets of the
Borrower or any of its subsidiaries.
(F) Change in Management. Change the current management of TSA or ACI, which the
Borrower represents to the Bank to be as follows:
TSA: Chairman--Xxxxxxx X. Xxxxx
Interim Chief Executive Officer/President--Xxxxx X. Xxxxxxx
Chief Financial Officer--Xxxxxx X. Xxxxxx
ACI: President--Xxxx X. Xxxxxx
Treasurer--Xxxxxx X. Xxxxxx
Provided, however, that the Bank acknowledges that TSA is currently engaged in
an executive search process for the purpose of selecting a new Chief Executive
Officer/President to serve on a permanent basis. Such selection and replacement
shall not constitute a violation of this paragraph.
(G) Change in Location of Offices. Change the location of the chief executive
offices of TSA or ACI from their current chief executive offices located in
Omaha, Nebraska.
(H) Guarantees. Guarantee or become liable in any way as surety, endorser (other
than as endorser of negotiable instruments for deposit or collection in the
ordinary course of business), accommodation endorser or otherwise for any
liabilities or obligations of any other person or entity, except for guarantees
by the Borrower of indebtedness otherwise permitted under Section 4.02(C) of
this Agreement which is incurred by a Primary Subsidiary.
(I) Loans, Advances, Investments. Without the Bank's prior written consent
(which consent shall not be unreasonably withheld or delayed), make any loans or
advances to or investment in any person or entity, other than: (1) trade
accounts receivable generated in the ordinary course of business, and (2) loans
made pursuant those existing commitments described in Schedule 4.02(J) attached
hereto.
(J) Futures Transactions. Use Advances to purchase, assume or hold any
position in any commodity futures, market or exchange.
(K) Factoring Arrangements. Enter into any factoring arrangements or other
transactions pursuant to which accounts are sold, except that so long as no
Event of Default (or event which with the passage of time or the giving of
notice or both, would become an Event of Default) has occurred:
(1) The Borrower may from time to time sell specifically identified
accounts to Fleet pursuant to the Fleet Factoring Agreement if either:
(a) The accounts to be sold are not Eligible Domestic
Accounts or Eligible Foreign Accounts; or
(b) The following requirements shall have been
satisfied:
(i) The Borrower shall have provided the Bank with
not less than three (3) Business Days' advance
written notice of its intent to sell such accounts,
which notice shall include: (A) an itemization of the
specific accounts to be sold, the amounts thereof,
and the purchase price therefor, (B) copies of any
documentation reflecting such sale, (C) a
then-current Borrowing Base Certificate reflecting
the exclusion of such accounts; and (D) a then
current Compliance Certificate; and
(ii) The Bank shall have determined that, after
exclusion of the accounts to be sold from the
Borrowing Base, the aggregate amount of all Advances
outstanding, together with all Advance Requests
Pending, does not exceed an amount equal to: (A)
eighty-five percent (85%) of Eligible Domestic
Accounts, plus (B) the lesser of (1) fifty percent
(50%) of Eligible Foreign Accounts, or (2) fifty
percent of the aggregate amount of all Advances
outstanding and Advance Requests pending (the sum of
(A) plus (B) is hereinafter referred to as the
"Factoring Limit").
(2) The Borrower may from time to time sell specifically identified
accounts to other parties pursuant to other factoring arrangements if
either:
(a) The accounts to be sold are not Eligible Domestic Accounts
or Eligible Foreign Accounts, and the Borrower shall have
provided the Bank with reasonable advance written notice (in
no event less than three (3) business days) of its intent to
sell such accounts, which notice shall include: (A) an
itemization of the specific accounts to be sold, the amounts
thereof, and the purchase price therefor, (B) copies of any
documentation reflecting such sale, (C) a statement indicating
that the accounts to be sold are neither Eligible Foreign
Accounts nor Eligible Domestic Accounts, (D) a then-current
Borrowing Base Certificate; and (E) a then current Compliance
Certificate; or
(b) The following requirements shall have been
satisfied:
(i) The Borrower shall have provided the Bank with
not less than ten (10) Business Days' advance written
notice of its intent to sell such accounts, which
notice shall include: (A) an itemization of the
specific accounts to be sold, the amounts thereof,
and the purchase price therefor, (B) copies of any
documentation reflecting such sale, (C) a
then-current Borrowing Base Certificate reflecting
the exclusion of such accounts; and (D) a then
current Compliance Certificate; and
(ii) The Bank shall have determined that, after
exclusion of the accounts to be sold from the
Borrowing Base, the aggregate amount of all Advances
outstanding, together with all Advance Requests
Pending, does not exceed the Factoring Limit;
The Fleet Factoring Agreement, together with any and all agreements entered into
pursuant to Section 4.02(K)(2), are collectively referred to herein as the
"Factoring Agreements." In no event shall any accounts which are subject to any
Factoring Agreement be included in the calculation of the Borrowing Base or the
Factoring Limit at any time.
ARTICLE V
EVENTS OF DEFAULT
SECTION 5.01. EVENTS OF DEFAULT.
(A) Events of Default. Any of the following events shall constitute an "Event of
Default" hereunder:
(1) The Borrower shall fail to pay any amount payable hereunder
or under the Note when due; or
(2) Any representation or warranty made by the Borrower or any Primary
Subsidiary, and/or any of their respective officers under or in
connection with any Loan Document shall prove to have been incorrect in
any material respect when made; or
(3) The Borrower or any of its subsidiaries shall fail to perform or
observe any other term, covenant or agreement contained in any Loan
Document on its part to be performed or observed and any such failure
shall remain unremedied for thirty (30) days after written notice
("Notice Period") thereof shall have been given to the Borrower by the
Bank, provided, however, that during the Notice Period the Bank may
suspend the making of Advances; or
(4) The Borrower or any of its subsidiaries shall fail to pay any
Material Indebtedness (defined below) to any party (excluding
indebtedness evidenced by the Note) or any interest or premium thereon,
when due (whether by scheduled maturity, required repayment,
acceleration, demand or otherwise) and such failure shall continue
after the applicable grace period, if any, specified in the agreement
or instrument relating to such Material Indebtedness; or any other
default under any agreement or instrument relating to any such Material
Indebtedness, or any other event, shall occur and shall continue after
the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such default or event is to accelerate, or
to permit the acceleration of, the maturity of such Material
Indebtedness; or any such Material Indebtedness shall be declared to be
due and payable, or required to be prepaid (other than by a regularly
scheduled required repayment), prior to the stated maturity thereof (as
used herein, the words "Material Indebtedness" shall mean any
indebtedness or obligation where the aggregate amount due or subject to
acceleration upon default is in excess of $1,000,000); or
(5) The Borrower or any of its subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its inability
to pay its debts generally, or shall make a general assignment for the
benefit of creditors; or any proceeding shall be instituted by or
against the Borrower or any of its subsidiaries seeking to adjudicate
it a debtor or insolvent, or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief, or
composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors, or seeking the entry
of an order for relief or the appointment of a receiver, trustee or
other similar official for it or for any substantial part of its
property, and, in the case of any such proceeding instituted against it
(but not instituted by it) either such proceeding shall remain
undismissed or unstayed for a period of sixty (60) days or any of the
actions sought in such proceeding (including, without limitation, the
entry of an order for relief against it or the appointment of a
receiver, trustee, custodian or other similar official for it or for
any substantial part of its property) shall occur; or the Borrower
shall take any action to authorize any of the actions set forth above
in this subsection (5); or
(6) Any judgment or order for the payment of money in excess of
$1,000,000 shall be rendered against the Borrower or any of its
subsidiaries and either:
(a) enforcement proceeding shall have been commenced by
any creditor upon such judgment or order, or
(b) the Borrower (or subsidiary, as applicable) shall have
failed to supersede such judgment or order with a surety
reasonably acceptable to the Bank on or before the lapse of
the time period for appeal thereof or therefrom;
(7) Any material provision of any of the Loan Documents shall for any
reason cease to be valid and binding on the Borrower or any Primary
Subsidiary, or the Borrower or any Primary Subsidiary shall so state or
assert in writing;
(8) The Security Agreements or Pledge Agreements shall for any reason,
except to the extent permitted by the terms thereof, cease to create a
valid and perfected first priority security interest in any of the
collateral purported to be covered thereby;
(9) The acquisition by any person or entity, or two or more persons or
entities acting in concert, of beneficial ownership (within the meaning
of SEC Rule 13d-3 under the Securities Exchange Act of 1934) of 20% or
more of the outstanding shares of voting stock of either TSA or ACI.
(10) Any event of default specified under any of the Loan
Documents.
(11) There shall occur or exist any facts which lead the Bank to
believe in good faith that the Borrower will not, or will be unable to,
pay when due any amounts due under this Agreement or any of the Loan
Documents.
(B) Remedies. Upon the occurrence of any Event of Default, the Bank may declare
its obligation to make Advances to be terminated or suspended as the Bank may
determine, whereupon the same shall forthwith terminate, and the Bank may, by
notice to the Borrower, declare the Note, all interest thereon and all other
amounts payable under this Agreement to be forthwith due and payable, whereupon
the Note, all such interest and all such amounts shall become and be forthwith
due and payable, without presentment, demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Borrower; and may exercise
all rights and remedies provided in any Loan Document and/or by applicable law,
provided, however, that in the event of an actual or deemed entry of an order
for relief with respect to any Loan Party under the Federal Bankruptcy Code, (x)
the obligation of the Bank to make Advances shall automatically be terminated
and (y) the Note, all such interest and all such amounts shall automatically
become due and payable, without presentment, demand, protest or any notice of
any kind, all of which are hereby expressly waived by the Borrower.
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. AMENDMENTS, ETC. No amendment or waiver of any provision of any
Loan Document, nor consent to any departure by the Borrower shall in any event
be effective unless the same shall be in writing and signed by the Bank and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.
SECTION 6.02. NOTICES, ETC. All notices and other communications provided for
under any Loan Document shall be in writing (including telegraphic, telex,
facsimile or cable communication) and mailed, telegraphed, telexed, cabled,
faxed or delivered, if to the Borrower, at its address at 000 Xxxxx 000xx
Xxxxxx, Xxxxx, Xxxxxxxx 00000, Attention: Chief Financial Officer, and if to the
Bank, at its address at 0000 Xxxx Xxxxxx Xxxx, Xxxxx, Xxxxxxxx 00000, Attention:
Xxxxx X. Xxxxx, Vice President, or, as to each party, at such other address as
shall be designated by such party in a written notice to the other party. All
such notices and communications shall, when mailed, telegraphed, telexed, faxed
or cabled, be effective when received or confirmed by telex answerback,
respectively, except that notices to the Bank pursuant to the provisions of
Article I shall not be effective until actually received by the Bank.
Notwithstanding the other provisions of this Section 6.02, the Bank may accept
oral borrowing notices pursuant to Section 1.02 hereof, provided that the Bank
shall incur no liability to the Borrower in acting on any such communication
that the Bank believes to have been given by a person authorized to give such
notice on behalf of the Borrower. Any confirmation sent by the Bank to the
Borrower of any borrowing under this Agreement shall, in the absence of manifest
error, be conclusive and binding for all purposes as to the Borrower.
SECTION 6.03. NO WAIVER, REMEDIES. No failure on the part of the Bank to
exercise, and no delay in exercising, any right under any Loan Document shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right under any Loan Document preclude any other or further exercise thereof or
the exercise of any other right. The remedies provided in the Loan Documents are
cumulative and not exclusive of any remedies provided by law.
SECTION 6.04. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP.
SECTION 6.05. COSTS, EXPENSES AND TAXES. The Borrower agrees to pay on
demand:
(A) Closing Costs. All costs and expenses in connection with the preparation,
execution, delivery, filing, recording and administration of the Loan Documents
(whether or not the transaction contemplated by the Loan Documents is
consummated), including, without limitation, on-site collateral examinations and
due diligence, the reasonable fees and out-of-pocket expenses of counsel for the
Bank (who may be in-house counsel for the Bank), and local counsel who may be
retained by said counsel, with respect thereto and with respect to advising the
Bank as to its rights and responsibilities under the Loan Documents. In
addition, the Borrower shall pay any and all stamp and other taxes (excluding
income taxes of the Bank) and fees payable or determined to be payable in
connection with the execution, delivery, filing and recording of the Loan
Documents and the other documents to be delivered under the Loan Documents, and
agrees to save the Bank harmless from and against any and all liabilities with
respect to or resulting from any delay in paying or omission to pay such taxes
and fees;
(B) Enforcement Costs. All costs and expenses (including reasonable counsel fees
and expenses) in connection with the enforcement of the Loan Documents and the
other documents to be delivered in connection with the Loan Documents, including
without limitation all such costs and expenses related directly or indirectly to
any enforcement, sale, collection or disposition of collateral or incurred
directly or indirectly with respect to any litigation or bankruptcy proceeding.
SECTION 6.06. RIGHT OF SETOFF. If any payment of principal, interest or other
sums is not made when due, or upon the occurrence of any other Event of Default,
the Bank is hereby authorized to set off and apply any and all deposits (general
or special, time or demand, provisional or final) at any time held and other
indebtedness at any time owing by the Bank to or for the credit or the account
of the Borrower against any and all of the obligations of the Borrower now or
hereafter existing under any Loan Document, irrespective of whether or not the
Bank shall have made any demand under such Loan Document and irrespective of
whether or not such deposits, indebtedness or such obligations may be unmatured
or contingent, and although the amount of such deposits may be in excess of the
Bank's share of the obligations and Advances. The rights of the Bank under this
Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which the Bank may have.
SECTION 6.07. SEVERABILITY. Any provision of this Agreement or of any other Loan
Document which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or thereof
or affecting the validity or unenforceability of such provision in any other
jurisdiction.
SECTION 6.08. CONSENT TO JURISDICTION AND SERVICE.
(A) THE BORROWER HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEBRASKA
STATE OR FEDERAL COURT SITTING IN OMAHA, NEBRASKA IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY LOAN DOCUMENT AND THE
BORROWER HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEBRASKA STATE COURT OR IN SUCH
FEDERAL COURT. THE BORROWER HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT
MAY IT MAY EFFECTIVELY DO SO, THE DEFENSE OF ANY INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH ACTION OR PROCEEDING.
(B) THE BORROWER IRREVOCABLY CONSENTS TO THE SERVICE OF COPIES OF THE SUMMONS
AND COMPLAINT AND ANY OTHER PROCESS WHICH MAY BE SERVED IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT TO WHICH THE BORROWER IS A PARTY BY THE MAILING OF COPIES OF SUCH
PROCESS TO THE BORROWER AT ITS ADDRESS SPECIFIED IN SECTION 6.02. THE BORROWER
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE
CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR
IN ANY OTHER MANNER PROVIDED BY LAW.
(C) NOTHING IN THIS SECTION 6.08 SHALL AFFECT THE RIGHT OF THE BANK TO SERVE
LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR AFFECT THE RIGHT OF THE
BANK TO BRING ANY ACTION OR PROCEEDING AGAINST THE BORROWER OR ITS PROPERTY IN
THE COURTS OF OTHER JURISDICTIONS.
SECTION 6.09. BINDING EFFECT, GOVERNING LAW. This Agreement shall be binding
upon and inure to the benefit of the Borrower and the Bank and their respective
successors and assigns, except that the Borrower shall not assign any of its
respective rights hereunder or any interest herein without the prior written
consent of the Bank. The Loan Documents shall be governed by, and construed in
accordance with, the laws of the State of Nebraska without regard to principles
of conflicts of laws.
SECTION 6.10. INDEMNIFICATION. The Borrower hereby indemnifies and holds the
Bank harmless from and against and shall reimburse the Bank with respect to any
and all claims, demands, causes of action, losses, damages, liabilities, costs
and expenses (including attorneys fees and court costs) of any and every kind or
character, known or unknown, fixed or contingent, asserted against the Bank at
any time and from time to time by reason of or arising out of: (1) the breach of
any representation or warranty of the Borrower or any Primary Subsidiary as set
forth in this Agreement or any Loan Document to which the Borrower or any
Primary Subsidiary is a party, (2) the failure of the Borrower or any Primary
Subsidiary to perform any obligation in this Agreement or any Loan Document to
which the Borrower or such Primary Subsidiary is a party, required to be
performed by the Borrower or such Primary Subsidiary, or (3) the exercise of any
rights of the Bank under the Loan Documents, including, without limitation,
attempts to realize on any collateral. The indemnification obligations of the
Borrower under this section shall survive the repayment of all Advances and the
termination of this Agreement.
SECTION 6.11. WAVIER OF JURY TRIAL. THE BORROWER AND THE BANK HEREBY IRREVOCABLY
WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR RELATING TO ANY LOAN DOCUMENT TO WHICH IT IS A PARTY OR ANY
INSTRUMENT OR DOCUMENT DELIVERED IN CONNECTION THEREWITH.
SECTION 6.12. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute but one and the same
agreement. This Agreement shall be effective only when accepted by the Bank, as
indicated by the signature of its duly authorized officers set forth below.
SECTION 6.13. ENTIRE AGREEMENT. This Agreement and the Loan Documents constitute
the entire understanding between the Borrower and the Bank with respect to the
subject matter hereof, and supersedes all prior written or oral understandings.
This Agreement may not be modified, amended or terminated except by a written
agreement signed by the party against whom enforcement is sought.
SECTION 6.14. OBLIGATIONS JOINT AND SEVERAL.
(A) Obligations Joint and Several. In the event that the Borrower consists of
more than one individual or entity, each Borrower expressly acknowledges that it
has benefited and will benefit, directly and indirectly, from each and every
Advance, and hereby acknowledges and undertakes, together with each other
Borrower, joint and several liability for the punctual payment when due, whether
at stated maturity, by acceleration or otherwise, of all obligations of the
Borrower under this Agreement and the other Loan Documents (including, without
limitation, any and all post-petition interest and expenses whether or not
allowed under any bankruptcy, insolvency or other similar law)(collectively, the
"Obligations"). Each Borrower hereby acknowledges that this Agreement is the
independent and several obligation of each Borrower and may be enforced against
each Borrower separately, whether or not enforcement of any right or remedy
hereunder has been sought against any other Borrower. Each Borrower further
agrees that its liability hereunder and under any other Loan Document shall be
absolute, unconditional, continuing and irrevocable. Each Borrower expressly
waives any requirement that the Bank exhaust any right, power or remedy and
proceed against any other Borrower under this Agreement or any other Loan
Documents, or against any Primary Subsidiary or other person under any guaranty
of, or security for, any of the Obligations.
(B) Joint and Several Obligations Absolute. If acceleration of the time for
payment of any amount payable by a Borrower with respect to the Obligations is
stayed upon the insolvency, bankruptcy, or reorganization of any other Borrower,
all such amounts otherwise subject to acceleration under the terms of this
Agreement shall nonetheless be payable by the other Borrower hereunder forthwith
on demand by the Bank. Each Borrower hereby agrees that its joint and several
liability for the Obligations of any other Borrower (the "Other Obligations")
under this Agreement shall not be released, discharged, diminished, impaired,
reduced, or affected for any reason or by the occurrence of any event,
including, without limitation, one or more of the following events, whether or
not with notice to or the consent of any Borrower: (a) the taking or accepting
of collateral as security for any or all of the Other Obligations or the
release, surrender, exchange, or subordination of any collateral now or
hereafter securing any or all of the Other Obligations; (b) any partial release
of the liability of any Borrower hereunder; (c) any disability of the other
Borrower, or the dissolution, insolvency, or bankruptcy of any other Borrower or
any other party at any time liable for the payment of any or all of the Other
Obligations; (d) any renewal, extension, modification, waiver, amendment, or
rearrangement of any or all of the Other Obligations or any instrument,
document, or agreement evidencing, securing, or otherwise relating to any or all
of the Other Obligations; (e) any adjustment, indulgence, forbearance, waiver,
or compromise that may be granted or given by the Bank to any other Borrower or
any other party ever liable for any or all of the Other Obligations; (f) any
neglect, delay, omission, failure, or refusal of the Bank to take or prosecute
any action for the collection of any of the Other Obligations or to foreclose or
take or prosecute any action in connection with any instrument, document, or
agreement evidencing, securing, or otherwise relating to any or all of the Other
Obligations; (g) the unenforceability or invalidity of any or all of the Other
Obligations or of any instrument, document, or agreement evidencing, securing,
or otherwise relating to any or all of the Other Obligations; (h) any payment by
any other Borrower or any other party to the Bank is held to constitute a
preference under applicable bankruptcy or insolvency law or if for any other
reason the Bank is required to refund any payment or pay the amount thereof to
someone else; (i) the settlement or compromise of any of the Other Obligations;
(j) the non-perfection of any security interest or lien securing any or all of
the Other Obligations; (k) any impairment of any collateral securing any or all
of the Other Obligations; (l) the failure of the Bank to sell any collateral
securing any or all of the Other Obligations in a commercially reasonable manner
or as otherwise required by law; (m) any change in the corporate existence,
structure, or ownership of any other Borrower; or (n) any other circumstance
which might otherwise constitute a defense available to, or discharge of, any
other Borrower (other than payment of the Other Obligations).
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective officers thereunto duly authorized, as of the date first
above written.
BORROWER: TRANSACTION SYSTEMS ARCHITECTS,
INC., a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx, Senior Vice
President and Chief Financial Officer
ACI WORLDWIDE INC.,
a Nebraska corporation
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Xxxxxx X. Xxxxxx, Treasurer
and Attorney-in-fact
BANK: U.S. BANK NATIONAL ASSOCIATION,
a national banking association
By: /s/ Xxxxx X. Xxxxx
------------------------
Xxxxx X. Xxxxx, Vice President
A LOAN AGREEMENT MUST BE IN WRITING TO BE ENFORCEABLE UNDER NEBRASKA LAW. TO
PROTECT YOU AND US FROM ANY MISUNDERSTANDINGS OR DISSAPPOINTMENTS, ANY CONTRACT,
PROMISE, UNDERTAKING, OR OFFER TO FOREBEAR REPAYMENT OF MONEY OR TO MAKE ANY
OTHER FINANCIAL ACCOMMODATION IN CONNECTION WITH ANY LOAN OF MONEY OR GRANT OR
EXTENSION OF CREDIT, OR ANY AMENDMENT OF, CANCELLATION OF, WAIVER OF, OR
SUBSTITUTION FOR ANY OR ALL OF THE TERMS OR PROVISIONS OF ANY INSTRUMENT OR
DOCUMENT EXECUTED IN CONNECTION WITH ANY LOAN OF MONEY OR GRANT OR EXTENSION OF
CREDIT, MUST BE IN WRITING TO BE EFFECTIVE.
EXHIBIT/SCHEDULE LIST TO CREDIT AGREEMENT
Exhibit A Form of Borrowing Base Certificate
Exhibit B Form of Promissory Note
Exhibit C Form of Pledge Agreement
Exhibit D Form of Security Agreement
Exhibit E Form of Guaranty
Exhibit F Form of Opinion of Borrower's Counsel
Exhibit G Form of Intercreditor Agreement
Exhibit H Form of Compliance Certificate
Schedule 1.03(B) Primary Subsidiaries
Schedule 3.01(G) Existing Defaults
Schedule 3.01(H) Transfers of Assets
Schedule 3.01(I) Pending Litigation
Schedule 4.01(G) Anticipated Extraordinary Cash Charges
Schedule 4.02(D) Permitted Debt
Schedule 4.02(J) Permitted Loans
