Exhibit 10.17
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
THIS AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT is entered into
as of September 10, 1998 by XXXXXXX-XXXXXX, INC., a Delaware corporation
("Borrower"), and EAST-WEST BANK, a California banking corporation ("Lender").
ARTICLE I
LOANS
1.1. The Credit. Lender agrees, on the terms and conditions set forth
in this Agreement, from the date of this Agreement to June 5, 2000 (the
"Commitment Termination Date"), to extend credit to Borrower by making advances
to Borrower (each such advance, a "Loan" and collectively, the "Loans") or by
issuing letters of credit for the account of Borrower (each, a "Letter of
Credit" and collectively, the "Letters of Credit"), as provided in Section 1.4
below, The sum of (a) the aggregate amount of all Loans outstanding, (b) the
aggregate amount of all Letters of Credit outstanding and (c) the aggregate
amount of all unreimbursed drawings under all Letters of Credit shall not exceed
the lesser of (i) $20,000,000 or (ii) the maximum amount Lender may legally lend
to Borrower under legal lending limit statutes and regulations applicable to
Lender, after taking into account other loans and commitments to persons and
entities related to Borrower that must be aggregated with loans and commitments
to Borrower for legal lending limit purposes (the "Legal Leading Limit").
Borrower and Lender intend the credit extended by this Agreement to be revolving
and as such, until the Commitment Termination Date and otherwise subject to the
terms and conditions of this Agreement, Borrower may borrow, repay and reborrow
the Loans and request Letters of Credit to be issued for its account. After the
Commitment Termination Date, Lender will not make any Loans or issue any Letters
of Credit.
1.2. Interest and Commitment Fee.
(a) On the first day of the month following the month in which the
first Loan is disbursed and on the first day of each month after such date (each
a "Payment Date"), Borrower shall pay to Lender the amount of interest which
shall have accrued during the calendar month (or portion of such calendar month,
as applicable) immediately preceding such Payment Date. The aggregate amount of
Loans outstanding from time to time shall bear interest at the rate which is the
sum of (i) the Libor Rate published from time to time by The Wall Street Journal
as the interest rate now quoted each business day for obligations of three
months' maturity, under the caption "Money Rates, London Interbank Offered Rates
(Libor)" and (ii) 2.00% per annum. If The Wall Street Journal discontinues
publishing Libor rates, Lender shall select a comparable rate in its place.
Borrower's monthly payment amount shall be calculated based on the following:
(1) interest shall be fixed for each month at the interest rate based on the
applicable Libor rate published on the last business day of the preceding
calendar month; and (2) interest shall be payable in arrears.
(b) Borrower shall on the date of this Agreement pay Lender a
commitment fee in the amount of $60,417. Such fee shall be earned by Lender in
full on the date of this Agreement and shall be nonrefundable.
1.3. Principal Repayment.
(a) Borrower shall make a payment to Lender promptly following
Lender's demand to the extent that the sum of (a) the aggregate amount of all
Loans outstanding, (b) the aggregate amount of all Letters of Credit outstanding
and (c) the aggregate amount of all unreimbursed drawings under all Letters of
Credit exceeds the lesser of (i) $20.000,000 or (ii) the Legal Lending Limit.
Any amounts so paid may, at Lender's election, be applied to the repayment of
outstanding Loans or retained as security for Borrower's obligations under the
Loan Documents. Borrower grants a security interest in any such amounts paid to
Lender and held by Lender as security.
(b) Borrower may, in a minimum amount of $25,000, prepay the
outstanding principal amount of the Loans on any Payment Date.
(c) Borrower shall repay the principal amount of all Loans
outstanding, together with all accrued interest thereon and all other amounts
owing under this Agreement, the Amended and Restated Promissory Note made by
Borrower on the date of this Agreement in the principal amount of $20,000,000
payable to the order of Lender (the "Note") and all other documents executed in
connection with the Loans (the "Loan Documents") on June 6, 2000 (the "Maturity
Date"), unless the maturity of the Note shall have been accelerated pursuant to
the terms of this Agreement.
1.4. Letters of Credit.
(a) Lender agrees, on the terms and conditions of this Agreement, to
issue Letters of Credit for the account of Borrower and for the benefit of
beneficiaries designated by Borrower, from time to time from the date of this
Agreement to the Commitment Termination Date. No Letter of Credit may have an
expiration date beyond the Maturity Date.
(b) Borrower shall fully reimburse Lender for each drawing under each
Letter of Credit on the date that such drawing is made.
(c) Borrower shall issue and maintain the Letters of Credit upon such
terms as it shall state to Borrower upon Borrower's request that Lender issue a
Letter of Credit. Lender's issuance of Letters of Credit shall also be governed
by any letter of credit application or letter of credit agreement that Lender
prescribes to Borrower.
1.5. Manner of Payment. All payments received by Lender later than
1:00 p.m. (Los Angeles time) shall be considered received on the following
business day. Receipt of a check for any payments in and of itself shall not
constitute payment. Lender may apply any payments made pursuant to the terms of
this Agreement and the other Loan Documents in such order as it shall determine
in its sole and absolute discretion.
1.6. Evidence of Debt.
(a) Borrower's indebtedness resulting from all Loans made from time to
time shall be evidenced by the Note.
(b) The books and accounts of Lender shall be conclusive evidence,
absent manifest error, of the amounts of all Loans and Letters of Credit,
repayments, interest, fees, reimbursement payments and other charges advanced,
due, outstanding or paid pursuant to this Agreement.
1.7. Overdue Payments. Except as otherwise expressly provided in this
Agreement, any amount payable under this Agreement or any other Loan Document
which is not paid when due (whether as a result of maturity, acceleration or
otherwise) shall bear interest, payable on demand, at a rate equal to the sum of
the interest rate provided for in Section 1.2(a) above plus five percent per
annum.
1.8. Use of Loan Proceeds. The first Loan under this Agreement shall
be used to repay all amounts owing under the Loan Agreement dated as of June 1,
1998 between Borrower and Lender (the "Original Loan Agreement"), in the
approximate amount of $4,769,554. Thereafter, Loans may be used to facilitate
Borrower's investment in real property, interests in real property and evidences
of indebtedness secured by real property and for general working capital
purposes.
1.9. Net Payments. All payments made by Borrower under this Agreement
and the other Loan Documents shall be made without setoff or counterclaim and in
such amounts as may be necessary in order that all such payments (after
deduction or withholding for or on account of any future taxes, levies, imposts,
duties or other charges of whatsoever nature imposed by any government, any
political subdivision or any taxing authority, including future taxes made
effective retroactively, other than any tax on or measured by the overall net
income of Lender pursuant to the income, bank or franchise tax laws of the
United States or the State of California (collectively, "Taxes")) shall not be
less than the amounts otherwise specified to be paid under this Agreement and
the other Loan Documents. A certificate as to any additional amounts payable to
Lender under this Section 1.9 submitted to Borrower by Lender shall show in
reasonable detail the amount payable and the calculations used to determine in
good faith such amount and shall be conclusive absent manifest error. Any
amounts payable by Borrower under this Section 1.9 with respect to past payments
shall be due within five business days following receipt by Borrower of such
certificate from Lender, any such amounts payable with respect to future
payments shall be due concurrently with such future payments. With respect to
each deduction or withholding for or on account of any Taxes, Borrower shall
promptly furnish to Lender such certificates, receipts and other documents as
may be required (in the reasonable judgment of Lender) to establish any tax
credit to which Lender may be entitled. Without any way affecting any of its
rights under this Section 1.9, Lender agrees that, upon its becoming aware that
any of the present or future payments due under this Agreement would be subject
to deduction for Taxes, it will notify borrower in writing, and Lender further
agrees that it will use reasonable efforts not disadvantageous to it (in its
sole determination) in order to avoid or minimize, as the case may be, the
payment by borrower of any additional amount for Taxes pursuant to this section
1.9.
ARTICLE II
CREDIT ADVANCES AND CONDITIONS
2.1. Requests for Loans. Lender shall make each Loan to Borrower on
the business day following Borrower's request therefor if such request is given
by 2:00 p.m. on any business day (or on the second following business day if
such request is given after 2:00 p.m. on any business day), which request shall
(a) be in writing, (b) state the amount of the Loan being requested and (c)
include a certification by Borrower in the form of Exhibit A to this Agreement.
2.2. Requests for Letters of Credit. Borrower shall request the
issuance of a Letter of Credit in writing on such form as Lender shall prescribe
from time to time on not less than two business days before the requested date
of issuance of such Letter of Credit. Any Letter of Credit request received by
Lender later than 2:00 p.m., Los Angeles time, shall be deemed to have been
received on the next business day.
2.3. Conditions Precedent to Initial Loan. Lender's obligation to make
the initial Loan referred to in Section 1.8 above shall be subject to the
satisfaction of the conditions precedent set forth in this Section 2.3.
(a) Loan Documents. Lender shall have received this Agreement and the
Note duly executed by Borrower.
(b) Borrower. Lender shall have received the following concerning
Borrower, in form and substance satisfactory to Lender: (i) a copy of Borrower's
bylaws certified to be true and complete by Borrower's secretary or assistant
secretary; (ii) a copy of Borrower's articles of incorporation and any
amendments, certified by the Delaware Secretary of State; (iii) a recent
good-standing certificate regarding Borrower issued by the California and
Delaware Secretaries of State, (iv) a certificate of Borrower's secretary or
assistant secretary, including a copy of resolutions, indicating that Borrower
is authorized to execute and deliver the Loan Documents and to perform its
obligations under the Loan Documents; (v) a certificate with respect to the
incumbency and signature of each person authorized to execute and deliver the
Loan Documents and Loan requests; and (vi) such other documents as Lender shall
reasonably request with respect to Borrower's existence and authorization.
(c) Other Conditions Precedent. Lender shall have received the
following, in form and substance satisfactory to Lender:
(i) such financial statements of Borrower and Borrower's
affiliates as Lender shall require;
(ii) if required by Lender, an opinion of counsel to Borrower
satisfactory to Lender concerning the existence and power of Borrower, the due
authorization, execution, delivery and enforceability of the Loan Documents and
such other matters as Lender shall require;
(iii) payment of the commitment fee referred to in Section 1.2
above and the payment of all of Lender's costs of entering into this Agreement
and making the initial Loan, including, without limitation, legal costs;
(iv) a consent signed by Colony K-W, LLC confirming that the
loans, made by Colony K-W, LLC to Borrower are subordinate to the credit
extended pursuant to this Agreement, and
(v) such other documents, agreements, certificates and assurances
as Lender shall require.
2.4. Conditions Precedent to All Loans and Letter of Credit Issuances.
Lender's obligation to make any Loan (including the initial Loan) or issue any
Letter of Credit is subject to all of the following conditions precedent:
(a) the Loan or Letter of Credit shall be in an amount not less than
$10,000;
(b) the proposed Loan or Letter of Credit, when aggregated with all
outstanding Loans, Letters of Credit and unreimbursed Letter of Credit draws,
shall not exceed the lesser of (i)$20,000,000 or (ii) the Legal Lending Limit;
(c) there shall exist no "Event of Default" (as defined in Section 6.1
below) or content which, with the passage of time or the giving of notice, or
both would become an Event of Default (a "Potential Event of Default");
(d) Lender is satisfied that no material adverse change in the
business or financial condition or management of Borrower or any material
"Subsidiary" (as defined below) has occurred; and
(e) all of the representations and warranties given by Borrower in the
Loan Documents shall be deemed to have been made on each date that a Loan is
made and such representations and warranties shall be true on such date.
For purposes of this Agreement, "Subsidiary" means any corporation,
partnership, limited liability company or other entity of which more than 50% of
the outstanding ownership interests having voting or consent power to effect
control of such corporation, partnership, limited liability company or other
entity is at the time directly or indirectly owned by Borrower, by Borrower and
one or more other Subsidiaries, or by one or more Subsidiaries.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Borrower makes the representations and warranties set forth in this
Article III to Lender.
3.1. Existence. Borrower is a corporation duly organized, validly
existing and in good standing under the laws of Delaware and has been duly
qualified to transact business as a foreign corporation in California.
3.2. Power. Borrower has all necessary corporate power to enter into
the Loan Documents and perform its obligations under such Loan Documents.
3.3. Enforceability of Loan Documents. The Loan Documents have been
duly executed and delivered by Borrower and are the legal, valid and binding
obligations of Borrower, enforceable against Borrower in accordance with their
respective terms.
3.4. Approvals. (a) Borrower and the Subsidiaries have obtained all
material approvals, licenses, exemptions and other authorizations from, and have
accomplished all material filings, registrations and qualifications with, all
applicable governmental authorities that are necessary for the transaction of
their business: and (b) 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 Borrower of the Loan
Documents.
3.5. No Conflict. Borrower's execution and delivery of, and its
performance of its obligations under, the Loan Documents do not and will not
conflict with (a) any (i) contractual or legal restriction or obligation, or
(ii) court or regulatory order, binding on or affecting Borrower or any
Subsidiary, or (b) any restriction contained in any of Borrower's or any
Subsidiary's constituent or governing documents.
3.6. Pending Litigation or Other Proceedings. There is no pending or,
to the knowledge of Borrower, threatened action, proceeding or investigation
before any court, governmental agency or arbitrator against or affecting
Borrower, any Subsidiary or any of Borrower's or any Subsidiary's material
assets which, if decided adversely to Borrower or any Subsidiary, would
materially and adversely affect the financial condition of Borrower, or would
materially and adversely affect the present or future ability of Borrower to
perform its obligations under the Loan Documents.
3.7. Solvency. Neither borrower nor any Subsidiary is insolvent and
none will be rendered insolvent by the transactions contemplated by the Loan
Documents. After giving effect to such transactions, neither borrower nor any
subsidiary will be left with an unreasonably small amount of capital with which
to engage in its business or undertakings, nor will Borrower nor any Subsidiary
have intended to incur, or believe that it has incurred, debts beyond its
ability to pay such debts as they mature.
3.8. Taxes. Borrower and the Subsidiaries have filed all required
federal, state and local tax returns, Borrower and the Subsidiaries have paid
all federal, state and local taxes due (including any interest and penalties)
other than taxes being promptly and actively contested in good faith and by
appropriate proceedings. Borrower and the Subsidiaries have established and are
maintaining adequate reserves for tax liabilities (including contested
liabilities) in accordance with generally accepted accounting principles.
3.9. Laws. Borrower and the Subsidiaries are in material compliance
with all laws, regulations and court orders applicable to them and their
businesses, including all state and federal securities laws. Except as disclosed
in the 1996 Loan Agreement, neither Borrower nor any Subsidiary has any
liability, contingent or otherwise, under any applicable law governing the use
or disposal of hazardous materials.
3.10. Insurance. Borrower and the Subsidiaries have insurance coverage
for their properties in prudent amounts provided by prudent insurers given the
nature of their businesses and the kinds of properties they own.
3.11. No Contractual Defaults. There are no material defaults by
Borrower or any Subsidiary under any material contract to which Borrower or such
Subsidiary. None of Borrower or any Subsidiary has received notice or has any
knowledge of any existing circumstances in respect of which it could receive any
notice of default or breach in respect of any of Borrower's or such Subsidiary's
material contracts.
3.12. Financial Position. The financial statements and all financial
data delivered to Lender relating to Borrower and the Subsidiaries are true,
correct and complete in all material respects. Such financial statements fairly
present the financial position of the parties or properties who are their
subjects as of the dates indicated. No material adverse change has occurred in
such financial position since the date of such financial statements, and, except
for the Loans, Borrower has incurred no indebtedness since the date of any such
statements.
3.13. Disclosure. None of Borrower's representations or warranties
contained in this Agreement or any other document, certificates or written
statement furnished to Lender by or on behalf of Borrower contains any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained in this Agreement or in such other
document, certificate or written statement (when taken in their entirety) not
misleading. There is no fact known to Borrower which materially or adversely
affects the business, operations, assets or condition (financial or otherwise)
of Borrower or any Subsidiary, which has not been disclosed in this Agreement or
in any other written statement delivered to Lender by Borrower.
3.14. ERISA. Borrower has not incurred any material accumulated
funding deficiency within the meaning of ERISA, and has not incurred any
material liability to the Pension Benefit Guaranty Company ("PBGC") in
connection with any employee benefit plan subject to the provisions of ERISA or
other class of benefit that PBGC has elected to insure.
ARTICLE IV
COVENANTS
While any obligation of Borrower under the Loan Documents remains
outstanding, Borrower shall comply with the following covenants.
4.1. Organization and Status of Borrower. Borrower shall, and shall
cause each Subsidiary to, maintain its corporate existence and all licenses and
permits relating thereto in good standing in every jurisdiction in which the
nature of its business makes qualification necessary or where failure to qualify
would have a material adverse effect on its financial condition or the
performance of its obligations under the Loan Documents.
4.2. Compliance with Laws. Borrower shall, and shall cause each
Subsidiary to, remain in compliance in all material respects with all laws and
requirements applicable to its business, including all applicable federal and
state securities laws, and obtain all authorizations, consents, approvals,
orders, licenses, exemptions from, and accomplish all filings or registrations
or qualifications with, any governmental agency that are necessary for the
transaction of its business.
4.3. Books and Records. Borrower shall, and shall cause each
Subsidiary to, maintain full and complete books of account and other records
reflecting the results of its operations and the operations of each Subsidiary,
in accordance with generally accepted accounting principles applied on a
consistent basis, and permit Lender and its agents, at all reasonable times and
from time to time, to inspect and copy any such books and records.
4.4. Notice of Certain Matters. Borrower shall give notice to Lender,
promptly upon learning thereof, of each of the following:
(a) any litigation or claim of any kind that might subject Borrower to
liability in excess of $100,000, whether covered by insurance or not;
(b) any material dispute between Borrower or any Subsidiary and any
governmental agency;
(c) the existence of any "reportable event" as defined in ERISA; and
(d) any other event or condition causing a material adverse change in
the financial condition of Borrower or any Subsidiary.
4.5. Further Assurances. Borrower shall execute and acknowledge (or
cause to be executed and acknowledged) and deliver to Lender all documents, and
take all actions, required by Lender from time to time to confirm the rights
created or now or hereafter intended to be created under the Loan Documents and
the transactions contemplated thereunder, to maintain, protect, perfect and
further the validity and enforceability of the Loan Documents or other
collateral for Borrower's obligations under the Loan Documents.
4.6. Taxes. Borrower shall, and shall cause each Subsidiary to, pay
and discharge all taxes, assessments and governmental charges or levies imposed
on it, on its income or profits or on any of its property prior to the date on
which penalties attach thereto.
4.7. Tangible Net Worth. Borrower's "Tangible Net Worth" (as defined
below) by December 31, 1998 shall not be less than $23,000,000.
"Tangible Net Worth" means the excess of total assets over total
liabilities (except debt subordinated to Lender by agreement satisfactory to
Lender), total assets and total liabilities each to be determined in accordance
with generally accepted accounting principles consistent with those applied in
the preparation of the financial statements referred to in Section 4.9 below,
excluding, however, from the determination of total assets, (a) goodwill,
organizational expenses, research and development expenses, trademarks, trade
names, copyrights, patents, patent applications, licenses and rights in any
thereof, and other similar intangibles, (b) all prepaid expenses, deferred
charges or unamortized debt discount and expense, (c) all reserves carried and
not deducted from assets, (d) all notes or accounts receivable from any
affiliate of Borrower or any officer of Borrower or any of Borrower's
affiliates, (e) securities which are not readily marketable, (f) cash held in a
sinking or other analogous fund established for the purpose of redemption,
retirement or prepayment of capital stock or indebtedness, (g) any write-up in
the book value of any asset resulting from a revaluation thereof subsequent to
the date of this Agreement and (h) any items not included in clauses (a) through
(g) above which are treated as intangibles in conformity with generally accepted
accounting principles.
4.8. Information.
(a) Borrower shall deliver the following information to Lender:
(i) as soon as available and in any event not later than 90 days
following the end of each fiscal year of Borrower, a consolidated and
consolidating balance sheet of Borrower as of the end of such year and
consolidated and consolidating statements of income, shareholders' equity and
cash flow of Borrower for such year, setting forth in each case in comparative
form corresponding consolidated and consolidating figures from the preceding
fiscal year and certified in accordance with generally accepted accounting
principles by independent certified public accountants satisfactory to Lender,
together with Borrower's report to the Securities and Exchange Commission on
Form 10K;
(ii) as soon as available and in any event within 60 days after
the end of the first three quarters of each fiscal year of Borrower, a
consolidated and consolidating balance sheet of Borrower as of the end of such
quarter and the related consolidated and consolidating statement of income of
Borrower for such quarter and the portion of Borrower's fiscal year ended at the
end of such quarter, setting forth in each case in comparative form the figures
for the corresponding portion of Borrower's previous fiscal year, all certified
(subject to normal year-end adjustments) as to fairness of presentation and
preparation in accordance with generally accepted accounting principles by the
chief financial officer of Borrower, together with Borrower's report to the
Securities and Exchange Commission on Form 10Q;
(iii) simultaneously with delivery of each set of financial
statements referred to in Sections 4.8(a)(i) and (ii) above, a certificate of
the chief financial officer of Borrower stating whether there exists on the date
of such certificate any Event of Default or Potential Event of Default, setting
forth the details thereof and the action that Borrower is taking or proposes to
take with respect thereto; and
(iv) such other information concerning Borrower and the
Subsidiaries, as Lender shall reasonably request.
(b) If Borrower fails to furnish promptly any information or report
required by Section 4.8(a) above or any other person fails to furnish promptly
any information or report required by any other provision of any of the Loan
Documents, or if Lender reasonably determines such reports to be unacceptable,
Lender may elect (in addition to exercising any other right or remedy it has
under the Loan Documents), to make an audit of all the books and records of
Borrower or any Subsidiary and to prepare the information or report which
Borrower failed to deliver. Such audit shall be performed and such information
or report shall be prepared by an independent firm of certified public
accountants to be selected by Lender. Borrower shall pay all expenses of the
audit and other related services.
4.9. Insurance. Borrower shall maintain, and shall cause each
Subsidiary to maintain, insurance with responsible and reputable insurance
companies in such amounts and covering such risks as is usually carried by
companies engaged in similar businesses and owning similar properties in the
same general areas in which Borrower and such Subsidiary operates.
4.10. Cross-Default. Borrower shall not permit a default under this
Agreement in and of itself to be a default under any other credit obligation to
any other creditor.
4.11. Maintenance of Properties. Borrower shall maintain and preserve,
and cause each Subsidiary to maintain and preserve, all of its properties in
good working order and condition in accordance with the terms of all leases of
space in such properties and otherwise in accordance with prudent standards or
business conduct.
4.12. Recourse Debt Ratio. Borrower shall maintain a ratio of (a)
"Debt" (as defined below) for which the lender or other creditor with respect to
such Debt has recourse to Borrower to (b) Borrower's Tangible Net Worth of not
greater than five to one.
"Debt" means, with respect to Borrower, (a) indebtedness or liability
for borrowed money whether or not evidenced by a written instrument, (b)
obligations under any guarantee or other agreement to become secondarily liable
for any obligation of another, endorsements (other than for collection or
deposit in the ordinary course of business) and other contingent obligations to
purchase, to provide funds for payment, to supply funds to invest or otherwise
to assure a creditor against loss; or (c) obligations secured by a lien on
Borrower's property, whether or not the obligations have been assumed by
Borrower. Debt shall not include current accounts payable incurred by Borrower
in reasonable amounts in the ordinary course of Borrower's business.
4.13. Additional Unsecured Borrowing. Borrower shall not incur, and
shall not permit any Subsidiary to incur, any unsecured Debt other than
unsecured Debt outstanding on the date of this Agreement.
4.14. Stock Repurchases. Borrower shall not purchase any capital stock
issued by Borrower or any affiliate of Borrower nor shall it make any loans or
advances to, or any investment in, any person for the purpose of facilitating
such a purchase.
ARTICLE V
EVENTS OF DEFAULT
5.1. Events of Default. The occurrence of any of the following shall
be an "Event of Default":
(a) Borrower's failure to pay when due any installment of principal,
reimbursement or interest under the this Agreement or any other sum required to
be paid by the terms of any Loan Document;
(b) the failure of Borrower, within 30 days following written notice
from Lender, to observe or perform any covenant or other agreement contained in
any Loan Document (other than the covenants or agreements referred to above in
Section 5.1(a)); provided however, that the notice and 30-day grace period set
forth above shall be applicable only to a failure to observe or perform any
covenant or other agreement which is reasonably susceptible of being cured;
provided further, that should Borrower be unable to cure its failure within such
30-day period despite beginning to cure such failure promptly after receipt of
notice and prosecuting such attempt diligently during such 30-day period, the
cure period shall be extended an additional 30 days so long as Borrower
continues diligently to prosecute the cure during such additional period;
(c) any writing representation, warranty or financial statement given
by Borrower shall have been untrue in any material respect when given;
(d) the occurrence of a default under any of the Loan Documents and
the failure of any such default to be cured during the defined time, if any, for
such cure;
(e) Borrower or any material Subsidiary shall be unable or shall admit
in writing its inability to pay its debts when due, or shall make an assignment
for the benefit of creditors; or any of them shall apply for or consent to the
appointment of any receiver, trustee or similar officer for such person or for
all or any substantial part of such person's property; or any of them shall
institute (by petition, application, answer, consent or otherwise) any
bankruptcy, insolvency, reorganization, arrangement, readjustment of debts,
dissolution, liquidation, or similar proceedings relating to such person under
the laws of any jurisdiction;
(f) if a receiver, trustee or similar officer shall be appointed for
Borrower or any material Subsidiary, or for all or any substantial part of any
such person's property without the application or consent of such person, and
such appointment shall continue undischarged for a period of 60 days (whether or
not consecutive); or any bankruptcy, insolvency, reorganization, arrangement,
readjustment of debt, dissolution, liquidation or similar proceedings shall be
instituted (by petition, application or otherwise) against any such person and
shall remain undismissed for a period of 60 days (whether or not consecutive);
(g) all or any material pan of the assets of Borrower or any material
Subsidiary shall become subject to attachment, execution or judicial seizure
(whether by enforcement of money judgment, by writ or warrant of attachment, or
by any other process) in an amount greater than $25,000;
(h) Borrower or any material Subsidiary., as applicable, shall be in
default in the payment of any indebtedness or the performance of any other
obligation secured by a lien on any material asset of such entity and such
default is not cured within the time, if any, specified for such a cure in any
applicable agreement;
(i) any of the Loan Documents shall cease to be a valid, binding and
enforceable obligation of the person purported to be bound, or Borrower shall
assert such cessation or failure in writing;
(j) Borrower shall incur a net loss in any fiscal year; or
(k) any material adverse change shall occur in Borrower's financial
condition, business or operations.
5.2. Remedies upon Default. Upon the occurrence of any Event of
Default. Lender may, at its option, do any of the following:
(a) terminate its obligation to make any Loans or Issue any Letters
of Credit;
(b) declare the principal of all amounts owing under the Loan
Documents, together with all accrued interest thereon and all other amounts
owing in connection therewith, to be immediately due and payable, regardless of
any other specified maturity or due date, without notice of default, presentment
or demand for payment, notice or demand of any kind, and without the necessity
of prior recourse to any security; provided, that any Event of Default with
respect to Borrower described in Sections 5.1(e) or (f) shall automatically,
without declaration or other action on Lender's part, cause all such amounts to
be immediately due and payable without notice or demand;
(c) If the Event of Default may be cured by the payment of money,
Lender may (but shall not be obligated) to make such payment from its own funds;
provided, that the making of such payment by Lender shall not be deemed to cure
such Event of Default, and that the same shall not be cured unless and until
Borrower reimburses Lender for such payment. If Lender advances its own funds
for such purposes, the funds advanced shall be considered advances under the
Note, notwithstanding that such advances may cause the total amount advanced
under this Agreement to exceed the aggregate face amount of the Note or the
amount committed to be advanced pursuant to this Agreement;
(d) to the extent any Letters of Credit are outstanding, Borrower
shall deposit with and pledge to Lender cash, or other collateral reasonably
satisfactory to Lender, in the aggregate amount of all such Letters of Credit;
(e) exercise any of its rights under the Loan Documents, including the
right to foreclose on any security, and exercise any other rights with respect
to any security, whether under the Loan Documents or as provided by law, all in
such order and in such manner as Lender in its sole discretion may determine.
5.3. Cumulative Remedies; No Waiver. Lender's remedies under the Loan
Documents are cumulative and shall be in addition to all rights and remedies
provided by law or in equity from time to time. The exercise by Lender of any
right or remedy shall not constitute a cure or waiver of any default nor
invalidate any notice of default or any act done pursuant to any such notice.
nor prejudice Len4er in the exercise of any other right or remedy. No Waiver by
Lender of any default shall be implied from any omission by Lender to take
action on account of such default if such default persists or is repeated. No
express waiver by Lender of any default shall affect any default other than the
default expressly waived and any such express waiver shall be operative only for
the time and to the extent of any Loan Document shall be construed as a waiver
of any subsequent breach of the same covenant, term or condition. Lender's
consent to or approval of any act by Borrower requiring further consent or
approval shall not be deemed to waive or render unnecessary Lender's consent to
or approval of any subsequent act.
ARTICLE VI
MISCELLANEOUS
6.1. Notices. Any notice, demand or request required under this
agreement shall be given in writing at the addresses set forth below by personal
service; telecopy, overnight courier or registered or certified, first class
mail, return receipt requested.
If to Borrower:
Xxxxxxx-Xxxxxx, Inc.
0000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. XxXxxxxx
Fax No.: (000) 000-0000
If to Lender:
East-West Bank
000 Xxxxxxxxxx Xxxxx
Xxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxx or Xxxxxxxx Xxxx
Fax No.: (000) 000-0000
Such addresses may be changed by notice to the other parties given in the same
manner as required above. Any notice, demand or request shall be deemed received
as follows: (i) if sent by personal service, at the time such personal service
is effected: (ii) if sent by telecopy, upon the sender's receipt of a
confirmation report generated by the sender's telecopier indicating receipt by
the recipient's telecopier; (iii) if sent by overnight courier, on the business
day immediately following deposit with the overnight courier; and (iv) if sent
by mail 48 hours following deposit in the mail.
6.2. Governing Law. All questions with respect to the construction of
this Agreement and the rights and liabilities of the parties to this Agreement
shall be governed by the laws of the State of California.
6.3. Binding on Successors. This Agreement shall inure to the benefit
of, and shall be binding upon, the successors and assigns of each of the parties
to this Agreement.
6.4. Attorneys' Fees.
(a) Borrower shall reimburse Lender for all reasonable attorney's
fees, costs and expenses incurred by Lender in connection with the enforcement
of Lender's rights under this Agreement and each of the other Loan Documents
including, without limitation, reasonable attorneys' fees, costs and expenses
for trial, appellate proceedings, out-of-court negotiations, workouts and
settlements or for enforcement of rights under any state or federal statute
including, without limitation, reasonable attorneys' fees, costs and expenses
incurred to protect Lender's security and attorneys' fees, costs and expenses
incurred in bankruptcy and insolvency proceedings such as (but not limited to)
seeking relief from stay in a bankruptcy proceeding. The term "expenses" means
any expenses incurred by Lender in connection with any of the out-of-court, or
state, federal or bankruptcy proceedings referred to above, including, without
limitation, the fees and expenses of any appraisers, consultants and expert
witnesses retained or consulted by Lender in connection with any such
proceeding.
(b) Lender shall also be entitled to its attorneys' fees, costs and
expenses incurred in any post-judgment proceedings to collect and enforce the
judgment. This provision is separate and several and shall survive the merger of
this Agreement into any judgment on this Agreement.
6.5. Counterparts. This Agreement may be executed in any number of
original counterparts, each of which shall be deemed an original, but all of
which when taken together shall constitute one instrument. The original
signature page of any counterpart may be detached from such counterpart and
attached to any other counterpart identical to such counterpart (except having
additional signature pages executed by other parties to this Agreement) without
impairing the legal effect of any such signature(s).
6.6. Entire Agreement. This Agreement and the other Loan Documents
constitute the entire agreement and understanding between the parties in respect
of the subject matter of this Agreement and supersede all prior agreements and
understandings with respect to such subject matter, whether oral or written.
6.7. Waivers. Waiver by Lender of any term covenant or condition under
this Agreement or the Loan Documents or of any default by Borrower under this
Agreement or the Loan Documents, or any failure by Lender to insist upon strict
performance by Borrower of any term, covenant or condition contained in this
Agreement or the Loan Documents shall be effective or binding on Lender only if
made in writing by Lender; no such wavier shall be implied from any omission by
Lender to take action with respect to any such term, covenant, condition or
default. No express written waiver by Lender of any term, covenant, condition or
default shall affect any other term, covenant, condition or default or cover any
other time period than the application of any such term, covenant or condition
to the matter as to which a waiver has been given or the default or time period
specified in such express waiver. This Agreement may be amended only by an
instrument in writing signed by the parties to this Agreement.
6.8. Severability. If any part of this Agreement is declared invalid
for any reason, such shall not affect the validity of the rest of the Agreement.
The other parts of this Agreement shall remain in effect as if this Agreement
had been executed without the invalid part. The parties declare that they intend
and desire that the remaining parts of this Agreement continue to be effect
without any part or parts that have been declared invalid.
6.9. Expenses. Borrower shall pay promptly all costs, charges and
expenses incurred by Lender in connection with the Loans, including, without
limitation, commitment fees, loan fees, service charges, title charges, tax and
lien service charges, costs of inspection, costs of consulting engineers,
recording fees, processing fees, appraisal fees, attorneys' fees, real property
taxes and assessments and insurance premiums, and any fees in consideration of
Lender's commitment to provide the Loan.
6.10. Amendment and Restatement. This Agreement is the successor to
the Loan Agreement dated as of June 1, 1998 between Borrower and Lender (the
"Original Loan Agreement"). This Agreement is an amendment and restatement of
the Original Loan Agreement, is not intended to be a novation or evidence a new
obligation or indebtedness and continues to evidence the obligations formerly
evidenced by the Original Loan Agreement.
EAST-WEST BANK, a California banking
corporation
By: /s/ Xxxxxxxx Xxxx
Xxxxxxxx Xxxx,
Vice President
XXXXXXX-XXXXXX, INC., a Delaware
corporation
By: /s/ Xxxxxxx X. XxXxxxxx
Xxxxxxx X. XxXxxxxx, President
EXHIBIT A
FORM OF CERTIFICATION FOR LOAN REQUEST
Xxxxxxx-Xxxxxx, Inc. ("Borrower") certifies as follows to East-West
Bank ("Lender") pursuant to Section 2.1 of the Amended and Restated Loan
Agreement dated as of September __, 1998 between Borrower and Lender (the "Loan
Agreement"), with the understanding that Lender is relying on this certification
in determining whether to make a "Loan" (as defined in the Loan Agreement) to
Borrower:
1. No Event of Default or any Potential Event of Default has occurred
and is continuing.
2. The representations and warranties contained in the Loan Agreement
are or will be true on the date on which the requested Loan is to be made; and
3. The aggregate amount of all Loans outstanding (including the amount
of the Loan being requested) does not exceed the lessor of (i) $20,000,000 or
(ii) the Legal Lending Limit.
All capitalized terms used in this Certificate without definition are
used as defined in the Loan Agreement.
Date:_____________ XXXXXXX-XXXXXX, INC., a Delaware corporation
By:
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