Exhibit 10.1

  

 

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AMENDED AND RESTATED CREDIT AGREEMENT

 

Dated as of March 24, 2016

 

among

 

CPI AEROSTRUCTURES, INC.

as the Borrower,

 

The Several Lenders from

Time to Time Parties Hereto

and

BANKUNITED, N.A.

as Sole Arranger, Administrative Agent and Collateral Agent

 

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TABLE OF CONTENTS

 

ARTICLE I.

DEFINITIONS    

ARTICLE II.

AMOUNT AND TERMS OF COMMITMENTS AND TERM LOANS    

ARTICLE III.

GENERAL PROVISIONS    

ARTICLE IV.

REPRESENTATIONS AND WARRANTIES    

ARTICLE V.

CONDITIONS PRECEDENT    

ARTICLE VI.

AFFIRMATIVE COVENANTS    

ARTICLE VII.

NEGATIVE COVENANTS    

ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES    

ARTICLE IX.

THE AGENT AND THE ARRANGER    

ARTICLE X.

MISCELLANEOUS    

SCHEDULES:

 

I

Commitments

4.1

Financial Condition

4.6

Material Litigation

4.8

Ownership of Property; Liens

4.10

Tax Filings and Payments

4.14

Subsidiaries

4.18

Insurance

7.2

Existing Indebtedness and Subordinated Debt

7.3

Existing Liens

7.4

Existing Guaranty Obligations

7.9(e)

Existing Investments    

EXHIBITS:

 

A-1

Form of Term Note

A-2

Form of Revolving Credit Note

B

Form of Guaranty Agreement

C

Form of Assignment and Acceptance

D

Form of Legal Opinion

E

Form of Closing Certificate

F

Form of Compliance Certificate

G

Secured Party Designation Notice

H

Tax Compliance Certificate Forms

I

Notice of Transaction

 

 

 
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AMENDED AND RESTATED CREDIT AGREEMENT, dated as of March 24, 2016 (this “Credit
Agreement”), among CPI AEROSTRUCTURES, INC., a New York corporation (the
“Borrower”), BANKUNITED, N.A., a national banking association, as Sole Arranger,
Agent, Lender and Swap Provider and the other financial institutions from time
to time parties hereto as lenders (collectively, the “Lenders”), BANKUNITED,
N.A., a national banking association, as administrative agent and collateral
agent for the Lenders and the Swap Provider hereunder (in such capacities, the
“Administrative Agent” and the “Collateral Agent,” respectively and each an
“Agent”).

 

Recitals

 

Santander Bank, N.A., as agent for the Existing Lender (defined herein) has made
available to the Borrower a revolving credit and term loan facility pursuant to
the Existing Credit Agreement (defined below). Certain “Obligations” (as defined
in the Existing Credit Agreement) of the Borrower to the Existing Lender under
the Existing Credit Agreement are evidenced by the Prior Notes. Effective as of
the date hereof, the Existing Lender has resigned as administrative agent under
the Existing Credit Agreement and has assigned to Agent (and Agent has accepted
from Existing Lender) all right, title and interest of Existing Lender in and to
the Existing Credit Agreement, the Prior Notes, the Existing Loan Documents and
all other documents in connection therewith.

 

The Borrower, the Lenders and the Administrative Agent have agreed to (i) amend
and restate the Existing Credit Agreement as herein reflected and (ii) to
appoint the Agent as Administrative Agent and Collateral Agent, and by the
execution and delivery of this Agreement do so amend and restate the Existing
Credit Agreement and appoint Agent as Administrative Agent and Collateral Agent,
and in connection therewith the Borrower has agreed to issue amended and
restated notes to the Lenders in replacement (without novation) of the Prior
Notes, to enter into amended and restated Loan Documents and to execute new or
restated credit support documentation.

 

Amendment and Restatement

 

The Borrower, the Administrative Agent and the Lenders hereby agree that upon
the effectiveness of this Agreement, the amounts available under and the terms
and provisions of the Existing Credit Agreement shall be and hereby are amended
and restated in their entirety by the terms and conditions of this Agreement and
the terms and provisions of the Existing Credit Agreement, except as otherwise
provided herein, shall be superseded by this Agreement.

 

Notwithstanding the amendment and restatement of the Existing Credit Agreement
by this Agreement, the Borrower shall continue to be, or now be, as the case may
be, liable to the Administrative Agent and the Lenders with respect to
agreements on the part of the Borrower under the Existing Loan Documents to
indemnify and hold harmless the Administrative Agent and the Lenders from and
against all claims, demands, liabilities, damages, losses, costs, charges and
expenses to which the Administrative Agent and the Lenders may be subject
arising in connection with the Existing Credit Agreement prior to the Closing
Date. Borrower does not have any offsets, defenses or counterclaims to its
obligations under the Existing Loan Documents. This Agreement is given as a
substitution and restatement of, and not as a repayment of, the obligations of
Borrower under the Existing Credit Agreement and is not intended to constitute a
novation of the Existing Credit Agreement. Except as otherwise selected by the
Borrower by delivery of a notice of borrowing or a notice of conversion prior to
the date hereof in accordance with the terms hereof, upon the effectiveness of
this Agreement, all amounts outstanding and owing by the Borrower under the
Existing Credit Agreement, as of the date hereof, as determined by the Lenders,
shall be refinanced and shall constitute Loans to the Borrower hereunder
accruing interest in accordance with the provisions hereof.

 

 

 
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In consideration of the premises and the mutual covenants herein set forth, the
parties hereto agree as follows:

 

ARTICLE I:     DEFINITIONS

 

1.1.     Defined Terms. As used in this Agreement, the following terms shall
have the following meanings:

 

“A-10 Contract Reimbursement Payment”: shall mean any modification, contract
reduction, contract reimbursement, penalty, refund or damage payments or other
similar fees, damages, refunds or other amounts payable in connection with the
foregoing, including (without limitation) any related income tax refund in
connection therewith, in each case with respect to or derived from the
modification and adjustment of the 2008 contract with The Boeing Company with
respect to the Boeing A-10 Wing Replacement Program.

 

“Accounts”: shall mean those accounts arising out of the sale or lease of goods
or the rendition of services by the Borrower and its Subsidiaries, as same may
be more fully described in the Security Documents.

 

“Account Debtor”: shall mean the Person who is obligated on or under an Account.

 

“Acquisition”: shall have the meaning set forth in the definition of “Permitted
Acquisition”.

 

“Administrative Agent”: as defined in the preamble hereto, and shall include any
successor appointed in accordance with Section 9.9.

 

“Affiliate”: of any Person, (a) any other Person (other than a wholly owned
Subsidiary of such Person) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person or (b) any other
Person who is a director or officer of (i) such Person, (ii) any Subsidiary of
such Person or (iii) any Person described in clause (a) above. For purposes of
this definition, a Person shall be deemed to be “controlled by” such other
Person if such other Person possesses, directly or indirectly, power either to
(A) vote 10% or more of the securities or other equity interest having ordinary
voting power for the election of directors of such first Person or (B) direct or
cause the direction of the management and policies of such first Person whether
by contract or otherwise.

 

 

 
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“Agent”: as defined in the preamble hereto, and shall include any successor
appointed in accordance with Section 9.9.

 

“Aggregate Loans”: on any date, the sum of the Aggregate Revolving Credit
Commitments (or if the Revolving Credit Commitments have terminated or expired
at such time, the Aggregate Revolving Credit Outstanding of all Revolving
Lenders) and the aggregate Term Loans outstanding.

 

“Aggregate Revolving Credit Commitments”: the aggregate amount of the Revolving
Credit Commitments of all the Revolving Lenders, provided that, in no event
shall the Aggregate Revolving Credit Commitments exceed the Aggregate Revolving
Credit Maximum Amount.

 

“Aggregate Revolving Credit Maximum Amount”: shall mean the principal amount of
up to $30,000,000.00.

 

“Aggregate Revolving Credit Outstanding”: as at any date of determination with
respect to any Revolving Lender, the aggregate unpaid principal amount of such
Lender’s Revolving Credit Loans on such date.

 

“Agreement”: this Amended and Restated Credit Agreement, as the same may be
amended, supplemented or otherwise modified from time to time.

 

“Applicable Margin”: means, from time to time with respect to Revolving Credit
Loans and Term Loans and the fees payable under Section 3.5(a), the following
percentages per annum, adjusted quarterly based upon the Borrower’s Maximum
Leverage Ratio for the fiscal quarter then-ended (the “Financial Covenant”) as
set forth in the most recent Compliance Certificate received by Administrative
Agent pursuant to Section 6.2(a):

 

Pricing Level

Leverage Ratio

Eurodollar Rate Margin

Base Rate Margin

Commitment Fee

1

>2.75x

2.75%

0.25%

0.30%

2

>2.00x < 2.75x

2.50%

0.00%

0.25%

3

> 1.00x; < 2.00x

2.25%

0.00%

0.25%

4

< 1.00x

2.00%

0.00%

0.25%

 

Any increase or decrease in the Applicable Margin resulting from a change in the
Financial Covenant shall become effective as of the first Business Day of the
month immediately following the date a Compliance Certificate is delivered
pursuant to Section 6.2(a); provided, however, that if a Compliance Certificate
is not delivered when due in accordance with such Section, then Pricing Level 1
shall apply as of the first Business Day of the month following the date such
Compliance Certificate was required to have been delivered and shall remain in
effect until the date on which such Compliance Certificate is delivered. The
Applicable Margin in effect from the Closing Date through March 31, 2016 shall
be determined based upon Pricing Level 2.

 

 

 
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Notwithstanding anything to the contrary contained in this definition, the
determination of Applicable Margin for any period shall be subject to the
provisions of Section 3.1(j).

 

“Applicable USA Contracts” means contracts between the Borrower and the United
States of America to which the Assignment of Claims Act applies.

 

“Approved Fund”: as defined in Section 10.6(b).

 

“Arranger”: BankUnited, N.A.

 

“Assignee”: as defined in Section 10.6(b) (iii).

 

“Assignment and Acceptance”: an assignment and acceptance agreement
substantially in the form attached hereto as Exhibit C executed by a Lender and
Eligible Assignee who has satisfied the requirements of Section 10.6.

 

“Attributable Indebtedness”: means, on any date, (a) in respect of any Financing
Lease of any Person, the capitalized amount thereof that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease or similar payments under the relevant lease or other
applicable agreement or instrument that would appear on a balance sheet of such
Person prepared as of such date in accordance with GAAP if such lease or other
agreement or instrument were accounted for as a Financing Lease, (c) all
Synthetic Debt of such Person, (d) in respect of any Securitization Transaction,
the outstanding principal amount of such financing, after taking into account
reserve accounts and making appropriate adjustments, determined by the
Administrative Agent in its reasonable judgment and (e) in respect of any Sale
and Leaseback Transaction, the present value (discounted in accordance with GAAP
at the debt rate implied in the applicable lease) of the obligations of the
lessee for rental payments during the term of such lease.

 

“Available Revolving Credit Commitment”: as of any date of determination with
respect to any Revolving Lender, an amount equal to the excess, if any, of (a)
the amount of such Lender’s Revolving Credit Commitment in effect on such date
over (b) the Aggregate Revolving Credit Outstanding of such Lender on such date.

 

“Base Rate”: means for any day a fluctuating rate per annum equal to (i) the
Agent’s Prime Rate from time to time in effect, plus (ii) the Applicable Margin.

 

“Base Rate Loans”: Loans the rate of interest applicable to which is based upon
the Base Rate.

 

“Benefited Lender”: as defined in Section 10.7(a).

 

“Board”: the Board of Governors of the Federal Reserve System of the United
States of America (or any successor thereto).

 

 

 
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“Borrower”: as defined in the preamble hereto.

 

“Borrowing Date”: any Business Day specified in a notice pursuant to Sections
2.2, 2.6, 2.8 or 3.2 as a date on which the Borrower requests the Lenders to
make Loans hereunder.

 

“Business”: as defined in Section 4.15(b).

 

“Business Day”: (a) for all purposes other than as covered by clause (b) below,
a day other than a Saturday, Sunday or other day on which commercial banks in
New York City are authorized or required by law to close and (b) with respect to
all notices and determinations in connection with, and payments of principal and
interest on, Eurodollar Loans, any day which is a Business Day described in
clause (a) and which is also a London Banking Day.

 

“Capital Expenditures”: direct or indirect (by way of the acquisition of
securities of a Person or the expenditure of cash or the incurrence of
Indebtedness) expenditures in respect of the purchase or other acquisition of
fixed or capital assets excluding normal replacements and maintenance which are
properly charged to current operations.

 

“Capital Stock”: any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, any and all
equivalent ownership interests in a Person (other than a corporation)
(collectively, “Underlying Equity Interests”), and any and all warrants or
options to purchase any of the foregoing. The term “Capital Stock” shall exclude
awards issued pursuant to incentive equity plans or other customary benefit
plans of Borrower and its Subsidiaries and Underlying Equity Interests issued
upon the exercise or vesting thereof.

 

“Cash Equivalents”: the following to the extent owned by the Borrower or any of
its Subsidiaries free and clear of all Liens (other than Liens created under the
Loan Documents and other Liens permitted hereunder): (a) securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed or insured by the United States Government or any agency thereof, (b)
certificates of deposit and euro dollar time deposits with maturities of one
year or less from the date of acquisition and overnight bank deposits of any
Lender or of any commercial bank having capital and surplus in excess of
$500,000,000, (c) repurchase obligations of any Lender or of any commercial bank
satisfying the requirements of clause (b) of this definition, having a term of
not more than 30 days with respect to securities issued or fully guaranteed or
insured by the United States Government, (d) commercial paper of a domestic
issuer rated at least A-3 by S&P or P-3 by Moody’s, (e) securities with
maturities of one year or less from the date of acquisition issued or fully
guaranteed by any state, commonwealth or territory of the United States, by any
political subdivision or taxing authority of any such state, commonwealth or
territory or by any foreign government, the securities of which state,
commonwealth, territory, political subdivision, taxing authority or foreign
government (as the case may be) are rated at least A by S&P or A by Moody’s (or
the equivalent rating by either such rating agency for such type of securities),
(f) securities with maturities of one year or less from the date of acquisition
backed by standby letters of credit issued by any commercial bank satisfying the
requirements of clause (b) of this definition or (g) shares of money market
mutual or similar funds which invest exclusively in assets satisfying the
requirements of clauses (a) through (f) of this definition.

 

 

 
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“Cash Management Agreement”: any agreement that is not prohibited by the terms
hereof to provide treasury or cash management services, including deposit
accounts, overnight draft, credit cards, debit cards, p-cards (including
purchasing cards and commercial cards), funds transfer, automated clearinghouse,
zero balance accounts, returned check concentration, controlled disbursement,
lockbox, account reconciliation and reporting and trade finance services and
other cash management services.

 

“Cash Management Bank”: any Person in its capacity as a party to a Cash
Management Agreement that, at the time it enters into a Cash Management
Agreement with a Loan Party, is a Lender or an Affiliate of a Lender, in its
capacity as a party to such Cash Management Agreement (even if such Person
ceases to be a Lender or such Person’s Affiliate ceased to be a Lender);
provided, however, that for any of the foregoing to be included as a “Secured
Cash Management Agreement” on any date of determination by the Administrative
Agent, the applicable Cash Management Bank (other than the Administrative Agent
or an Affiliate of the Administrative Agent) must have delivered a Secured Party
Designation Notice to the Administrative Agent prior to such date of
determination.

 

“Change in Law” shall have the meaning set forth in Section 3.10(b).

 

“Class”: the classification of loans as Term Loans or Revolving Credit Loans,
each of which categories shall be deemed to be a “Class” of Loans.

 

“Closing Date”: the first date that all the conditions precedent in Section 5.1
are satisfied or waived in accordance with Section 10.1.

 

“Code”: the Internal Revenue Code of 1986, as amended from time to time.

 

“Collateral”: means the assets and properties of the Loan Parties in which the
Collateral Agent, for the benefit of the Lenders, is granted a security interest
pursuant to the Security Documents.

 

“Collateral Agent”: as defined in the preamble hereto, and shall include any
successor appointed in accordance with Section 9.9.

 

“Commitments”: the collective reference to the Term Commitments, and the
Revolving Credit Commitments.

 

“Continuing Directors”: the directors of the Borrower on the Closing Date and
each other director, if such other director’s nomination for election to the
Board of Directors of the Borrower is recommended by a majority of the then
continuing Directors.

 

 

 
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“Contract Termination Payment”: shall mean any termination, cancellation,
rejection or similar fee or amount received by Borrower upon any early
termination, cancellation, rejection, expiration or inability to agree with
respect to any Designated Contract or any damages or other amounts received by
Borrower for the foregoing. An A-10 Contract Reimbursement Payment shall be
deemed to NOT constitute a Contract Termination Payment.

 

“Contractual Obligation”: as to any Person, any provision of any security issued
by such Person or of any agreement, instrument or undertaking to which such
Person is a party or by which it or any of its property is bound.

 

“Debt Service Coverage Ratio” has the meaning ascribed in Section 7.1(a).

 

“Debtor Relief Laws”: means the Bankruptcy Code of the United States, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar debtor relief laws of the United States or other applicable
jurisdictions from time to time in effect.

 

“Default”: any of the events specified in Section 8, whether or not any
requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.

 

“Defaulting Lender”: means, subject to Section 2.9(b), any Lender that (a) has
failed to (i) fund all or any portion of its Loans within two (2) Business Days
of the date such Loans were required to be funded hereunder unless such Lender
notifies the Administrative Agent and the Borrower in writing that such failure
is the result of such Lender’s determination that one or more conditions
precedent to funding (each of which conditions precedent, together with any
applicable default, shall be specifically identified in such writing) has not
been satisfied, or (ii) pay to the Administrative Agent, or any other Lender any
other amount required to be paid by it hereunder within two (2) Business Days of
the date when due, (b) has notified the Borrower, the Administrative Agent, in
writing that it does not intend to comply with its funding obligations
hereunder, or has made a public statement to that effect (unless such writing or
public statement relates to such Lender’s obligation to fund a Loan hereunder
and states that such position is based on such Lender’s determination that a
condition precedent to funding (which condition precedent, together with any
applicable default, shall be specifically identified in such writing or public
statement) cannot be satisfied), (c) has failed, within three (3) Business Days
after written request by the Administrative Agent or the Borrower, to confirm in
writing to the Administrative Agent and the Borrower that it will comply with
its prospective funding obligations hereunder (provided that such Lender shall
cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such
written confirmation by the Administrative Agent and the Borrower), or (d) has,
or has a direct or indirect parent company that has, (i) become the subject of a
proceeding under any Debtor Relief Law, or (ii) had appointed for it a receiver,
custodian, conservator, trustee, administrator, assignee for the benefit of
creditors or similar Person charged with reorganization or liquidation of its
business or assets, including the Federal Deposit Insurance Corporation or any
other state or federal regulatory authority acting in such a capacity; provided
that a Lender shall not be a Defaulting Lender solely by virtue of the ownership
or acquisition of any equity interest in that Lender or any direct or indirect
parent company thereof by a Governmental Authority so long as such ownership
interest does not result in or provide such Lender with immunity from the
jurisdiction of courts within the United States or from the enforcement of
judgments or writs of attachment on its assets or permit such Lender (or such
Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts
or agreements made with such Lender. Any determination by the Administrative
Agent that a Lender is a Defaulting Lender under any one or more of clauses (a)
through (d) above, and the effective date of such status, shall be conclusive
and binding absent manifest error, and such Lender shall be deemed to be a
Defaulting Lender (subject to Section 2.9(b)) as of the date established
therefor by the Administrative Agent in a written notice of such determination,
which shall be delivered by the Administrative Agent to the Borrower, and each
other Lender promptly following such determination.

 

 

 
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“Designated Account”: as defined in Section 3.1(e).

 

“Designated Amount”: shall mean the lesser of (i) fifty (50%) percent of each
Contract Termination Payment received by the Borrower (less amounts due to
subcontractors), or (ii) the outstanding principal balance of the Term Loan.

 

“Designated Contract”: means contracts executed (or to be executed) by the
Borrower in Borrower’s Line of Business which provide for Contract Termination
Payments, including (without limitation) each such final contract, any
amendments and additions thereto, and any letter subcontract, memorandum of
understanding, term sheet or supporting documentation in connection therewith.

 

“Designated USA Contract”: means, collectively, the Applicable USA Contracts
between Borrower and DLA Aviation ASC SMSG Special Acquisition, numbers
SPE4AX-15-D-9405 and SPE4AX-15-D-9418.

 

“Dividends”: means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Capital Stock or other equity
interest of Borrower or any Subsidiary, or any payment (whether in cash,
securities or other property), including any sinking fund or similar deposit, on
account of the purchase, redemption, retirement, acquisition, cancellation or
termination of any such Capital Stock or other equity interest or on account of
any return of capital to Borrower’s stockholders, partners or members (or the
equivalent Person thereof).

 

“Dollars”, “U.S. Dollars” and “$”: dollars in lawful currency of the United
States of America.

 

“Domestic Subsidiary”: any Subsidiary other than a Foreign Subsidiary.

 

“EBITDA”: means, at any date of determination, an amount equal to Net Income of
the Borrower and its Subsidiaries on a consolidated basis for the most recently
completed measurement period plus (a) the following to the extent deducted in
calculating such Net Income: (i) Interest Expense, (ii) the provision for
Federal, state, local and foreign income taxes payable, (iii) depreciation and
amortization expense and (iv) other non-recurring expenses reducing such Net
Income which do not represent a cash item in such period or any future period
(in each case of or by the Borrower and its Subsidiaries for such measurement
period) and minus (b) the following to the extent included in calculating such
Net Income: (i) Federal, state, local and foreign income tax credits, (ii) all
non-cash items increasing Net Income (in each case of or by the Borrower and its
Subsidiaries for such measurement period), and (iii) the sum of all
non-recurring reimbursement and termination payments including (without
limitation) all A-10 Contract Reimbursement Payments and Contract Termination
Payments.

 

 

 
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“Eligible Assignee”: shall have the meaning set forth in Section 10.6(b)(i).

 

“Environmental Laws”: the common law and all laws, regulations, codes,
ordinances, orders, decrees, judgments, injunctions, notices or binding
agreements issued, promulgated or entered into by any Governmental Authority,
relating in any way to the environment, the preservation or reclamation of
natural resources, the management, Release or threatened Release of any
Hazardous Materials or to health and safety matters.

 

“Equipment Collateral”: means all equipment and fixtures of each Loan Party,
whether now owned or hereafter acquired, wherever located, including, without
limitation, all machinery, furniture, furnishings, leasehold improvements,
computer equipment, books and records, motor vehicles, forklifts, rolling stock,
dies and tools used or useful in each Loan Party's business operations.

 

“ERISA”: the Employee Retirement Income Security Act of 1974, as amended from
time to time.

 

“ERISA Affiliate”: any trade or business (whether or not incorporated) that,
together with the Borrower or any of its Subsidiaries, is treated as a single
employer under Section 414(b) or (c) of the Code or, solely for purposes of
Section 302 of ERISA and Section 412 of the Code, is treated as a single
employer under Section 414 of the Code, other than United Refining Company, a
Pennsylvania corporation, and its Subsidiaries.

 

“ERISA Event”: (a) any “reportable event,” as defined in Section 4043 of ERISA
or the regulations issued thereunder, with respect to a Plan (other than an
event for which the 30-day notice period is waived); (b) with respect to any
Plan, failure to satisfy the minimum funding standard (as defined in Section 412
of the Code or Section 302 of ERISA), whether or not waived, (c) the failure to
make by its due date a required installment under Section 412(m) of the Code (or
Section 430(j) of the Code, as amended by the Pension Protection Act of 2006)
with respect to any Plan or the failure to make any required contribution to a
Multiemployer Plan; (d) the filing pursuant to Section 412of the Code or of an
application for a waiver of the minimum funding standard with respect to any
Plan; (e) the incurrence by the Borrower or any of its ERISA Affiliates of any
liability under Title IV of ERISA with respect to the termination of any Plan;
(f) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan
administrator of any notice relating to an intention to terminate any Plan or
Plans or to appoint a trustee to administer any Plan; (g) the incurrence by the
Borrower or any of its ERISA Affiliates of any liability with respect to the
withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (h) the
receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by
any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice,
concerning the imposition of Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, “insolvent” or in “reorganization”,
within the meaning of Title IV of ERISA; or (i) the making of any amendment to
any Plan which could result in the imposition of a lien or the posting of a bond
or other security.

 

 

 
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“Eurodollar Loans”: Loans the rate of interest applicable to which is based upon
the Eurodollar Rate.

 

“Eurodollar Rate”: with respect to a Eurodollar Loan for the relevant Interest
Period, an interest rate per annum (rounded upwards, if necessary, to the next
1/16 of 1%) equal to (a) for Revolving Credit Loans, the sum of (i) the LIBOR
Rate for such Interest Period plus (ii) the Applicable Margin, and (b) for the
Term Loan, the sum of (i) the LIBOR Rate for such Interest Period plus (ii) the
Applicable Margin.

 

“Event of Default”: any of the events specified in Section 8, provided that any
requirement for the giving of notice, the lapse of time, or both, or any other
condition, has been satisfied.

 

“Exchange Act”: the Securities Exchange Act of 1934, as amended.

 

“Excluded Taxes”: means any of the following Taxes imposed on or with respect to
any Recipient or required to be withheld or deducted from a payment to a
Recipient, (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its Lending Office located in, the
jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Loan or Commitment pursuant
to a law in effect on the date on which (i) such Lender acquires such interest
in the Loan or Commitment (other than pursuant to an assignment request by the
Borrower under Section 10.6) or (ii) such Lender changes its Lending Office,
except in each case to the extent that, pursuant to Section 3.12(a)(ii),
(a)(iii) or (c), amounts with respect to such Taxes were payable either to such
Lender’s assignor immediately before such Lender became a party hereto or to
such Lender immediately before it changed its Lending Office, (c) Taxes
attributable to such Recipient’s failure to comply with Section 3.12(e) and
(d) any U.S. federal withholding Taxes imposed pursuant to FATCA.
Notwithstanding anything to the contrary contained in this definition, “Excluded
Taxes” shall not include any withholding tax imposed at any time on payments
made by or on behalf of a Foreign Borrower to any Lender hereunder or under any
other Loan Document, provided that such Lender shall have complied with Section
3.12(e).

 

“Existing Credit Agreement”: shall mean that certain Amended and Restated Credit
Agreement between the Borrower and Santander Bank, N.A., successor to Sovereign
Bank, N.A., dated as of December 5, 2012, as amended pursuant to that certain
First Amendment dated as of August 6, 2014 and that Second Amendment dated as of
March 31, 2015.

 

 

 
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“Existing Lender”: collectively, the agent and lenders party to the Existing
Credit Agreement.

 

“Existing Loan Documents”: shall mean the “Loan Documents” as defined in the
Existing Credit Agreement, including (without limitation) the Existing Credit
Agreement, the Prior Notes and any “Security Agreements” as defined therein.

 

“Extension of Credit”: as to any Lender, the making of a Loan by such Lender.

 

“Facility”: means the Term Loans or the Revolving Credit Loans, as the context
may require.

 

“FATCA”: means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreements entered into
pursuant to Section 1471(b)(1) of the Code.

 

“Federal Funds Effective Rate”: for any day, the weighted average (rounded
upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged
by Federal funds brokers, as published on the next succeeding Business Day by
the Federal Reserve Bank of New York, or, if such rate is not so published for
any day that is a Business Day, the average (rounded upwards, if necessary, to
the next 1/100 of 1%) of the quotations for such day for such transactions
received by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.

 

“Financial Covenants”: the financial covenants set forth in Section 7.1.

 

“Financial Officer”: with respect to any Person, the chief executive officer, or
the chief financial officer of such Person.

 

“Financing Lease”: (a) any lease of property, real or personal, the obligations
under which are capitalized on a consolidated balance sheet of the Borrower and
its Subsidiaries and (b) any operating lease (excluding leases of real property)
and any other lease to the extent that the then present value of the minimum
rental commitment thereunder should, in accordance with GAAP, be capitalized on
a balance sheet of the lessee.

 

“Foreign Borrower” means any Borrower that is organized under the laws of a
jurisdiction other than the Unites States, a state thereof or the District of
Columbia.

 

“Foreign Lender”: any Lender that is organized under the laws of a jurisdiction
other than that in which the Borrower is located. For purposes of this
definition, the United States of America, each State thereof and the District of
Columbia shall be deemed to constitute a single jurisdiction.

 

 

 
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“Foreign Obligor” means a Loan Party (if any) that is a Foreign Subsidiary.

 

“Foreign Plan”: any employee benefit plan, program, policy, arrangement or
agreement maintained or contributed to by, or entered into with, Borrower or any
Subsidiary with respect to employees employed outside the United States.

 

“Foreign Subsidiary”: as to any Person, any Subsidiary of such Person which is
organized under the laws of any jurisdiction outside of the country of the
jurisdiction of organization of such Person.

 

“Funded Debt”: means, as of any date of determination, for the Borrower and its
Subsidiaries on a consolidated basis, the sum of (a) the outstanding principal
amount of all obligations, whether current or long-term, for borrowed money
(including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, (b) all
purchase money Indebtedness, (c) all direct obligations arising under letters of
credit (including standby and commercial), bankers’ acceptances, bank
guaranties, surety bonds and similar instruments, (d) all obligations in respect
of the deferred purchase price of property of services (other than trade
accounts payable in the ordinary course of business), (e) all Attributable
Indebtedness, (f) without duplication, all Guaranty Obligations with respect to
outstanding Indebtedness of the types specified in clauses (a) through (e) above
of Persons other than the Borrower or any Subsidiary, and (g) all Indebtedness
of the types referred to in clauses (a) through (f) above of any partnership or
joint venture (other than a joint venture that is itself a corporation of
limited liability company) in which the Borrower or a Subsidiary is a general
partner or joint venture, unless such Indebtedness is expressly made
non-recourse to the Borrower or such Subsidiary.

 

“GAAP”: GAAP means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved from time to time by a significant segment of the
accounting profession in the United States, that are applicable to the
circumstances as of the date of determination, consistently applied.

 

“Governmental Authority”: any nation or government, any state, province or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.

 

“Guarantors” means the Domestic Subsidiaries of the Borrower as are or may from
time to time become parties to this Agreement pursuant to Section 6.9, together
with any other Persons who may become guarantors of the Obligations.

 

 

 
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“Guaranty Agreement”: the Guaranty Agreement, substantially in the form attached
hereto as Exhibit B, executed and delivered by Loan Parties other than Borrower,
as the same may be amended, supplemented or otherwise modified.

 

“Guaranty Obligation”: as to any Person, any obligation of such Person
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or
other obligations (the “primary obligations”) of any other Person (the “primary
obligor”) in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent (a) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of any such
primary obligation against loss in respect thereof; provided, however, that the
term Guaranty Obligation shall not include guarantees by a Loan Party of any
other Loan Party’s primary obligations or endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Guaranty Obligation shall be deemed to be an amount, without double counting if
more than one Loan Party guarantees a primary obligation of a primary obligor,
the obligations, equal to the value as of any date of determination of the
stated or determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made (unless such Guaranty Obligation shall be expressly
limited to a lesser amount, in which case such lesser amount shall apply) or, if
not stated or determinable, the value as of any date of determination of the
maximum reasonably anticipated liability in respect thereof as determined by
such Person in good faith.

 

“Hazardous Materials”: any solid wastes, toxic or hazardous substances,
materials or wastes, defined, listed, classified or regulated as such in or
under any Environmental Laws, including, without limitation, asbestos, petroleum
or petroleum products (including gasoline, crude oil or any fraction thereof),
polychlorinated biphenyls, and urea-formaldehyde insulation, and any other
substance the presence of which may give rise to liability under any
Environmental Law.

 

“Indebtedness”: of a Person, at a particular date, the sum (without duplication)
at such date of (a) indebtedness for borrowed money or for the deferred purchase
price of property or services in respect of which such Person is liable as
obligor (other than trade liabilities and accruals of expenses incurred in the
ordinary course of business and payable in accordance with customary practices
of such Person), (b) indebtedness secured by any Lien on any property or asset
owned or held by such Person regardless of whether the indebtedness secured
thereby shall have been assumed by or is a primary liability of such Person, (c)
obligations of such Person under Financing Leases, (d) the face amount of all
letters of credit issued for the account of or upon the application of such
Person and, without duplication, the unreimbursed amount of all drafts drawn
thereunder, (e) obligations (in the nature of principal or interest) of such
Person in respect of acceptances or similar obligations issued or created for
the account of such Person and (f) net obligations of such Person under any Swap
Contract. The amount of any net obligation under any Swap Contract on any date
shall be deemed to be the Swap Termination Value thereof as of such date. If for
any reason, the sale of Sold Receivables is judicially or otherwise
re-characterized as a grant of collateral by Borrower to secure financing,
Indebtedness shall be deemed to not include such financing.

 

 

 
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“Indemnified Taxes”: Taxes other than Excluded Taxes.

 

“Installment Payment Date”: shall mean any date on which all or any portion of
the principal amount of the Term Loan is due and payable.

 

“Intellectual Property”: as defined in Section 4.9.

 

“Interest Expense”: means, for any measurement period, the sum of (a) all
interest, premium payments, debt discount, fees, charges and related expenses in
connection with borrowed money (including capitalized interest) or in connection
with the deferred purchase price of assets, in each case to the extent treated
as interest in accordance with GAAP, (b) all interest paid or payable with
respect to discontinued operations and (c) the portion of rent expense under
Financing Leases that is treated as interest in accordance with GAAP, in each
case, of or by the Borrower and its Subsidiaries on an consolidated basis for
the most recently completed measurement period.

 

“Interest Payment Date”: (a) as to any Base Rate Revolving Loan, the first
Business Day of each April, July, October and January and the Maturity Date of
such Loan, (b) as to any Base Rate Term Loan, the first Business Day of each
month, (c) as to any Eurodollar Loan having an Interest Period of three (3)
months or less, the last day of such Interest Period and the Maturity Date of
such Loan and (d) as to any Eurodollar Loan having an Interest Period longer
than three (3) months, (i) each day which is three (3) months after the first
day of such Interest Period and (ii) the last day of such Interest Period.

 

“Interest Period”: with respect to any Eurodollar Loan:

 

(a)     initially, the period commencing on the borrowing or conversion date, as
the case may be, with respect to a Loan and ending one (1), two (2), three (3)
or six (6) months thereafter, as selected by the Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with respect
thereto;

 

(b)     thereafter, each period commencing on the last day of the immediately
preceding Interest Period applicable to a Loan and ending one (1), two (2),
three (3) or six (6) months thereafter, as selected by the Borrower by
irrevocable notice to the Administrative Agent not less than three Business Days
prior to the last day of the then current Interest Period with respect thereto;
and provided that all of the foregoing provisions relating to Interest Periods
are subject to the following:

 

 

 
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(i)     if any Interest Period pertaining to a Loan would otherwise end on a day
that is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to carry
such Interest Period into another calendar month, in which event such Interest
Period shall end on the immediately preceding Business Day;

 

(ii)     any Interest Period applicable to a Loan that would otherwise extend
beyond the date final payment is due on such Loan shall end on such date of
final payment; and

 

(iii)     any Interest Period pertaining to a Loan that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of a calendar month.

 

(c)     No portion of the Term Loans shall be made, continued as or converted
into a Eurodollar Loan with an Interest Period which extends beyond an
Installment Payment Date if, after giving effect to the Borrowing, continuation
or conversion of such Eurodollar Loan, the amount payable on any Installment
Payment Date would exceed the sum of (i) the aggregate principal amount of the
outstanding portion of the Term Loan constituting Eurodollar Loans with Interest
Periods ending prior to such Installment Payment Date and (ii) the aggregate
outstanding portion of the Term Loan constituting Base Rate Loans.

 

“Inventory Collateral”: means all inventory of each Loan Party, whether now
owned or hereafter acquired, wherever located, including, without limitation,
all goods of each Loan Party held for sale or lease or furnished or to be
furnished under contracts of service, all goods held for display or
demonstration, goods on lease or consignment, spare parts, repair parts,
returned and repossessed goods, all raw materials, work-in-process, finished
goods and supplies used or consumed in such Loan Party's business, together with
all documents, documents of title, dock warrants, dock receipts, warehouse
receipts, bills of lading or orders for the delivery of all, or any portion, of
the foregoing; provided, however, that “Inventory Collateral” shall not include
goods which are placed by the owner thereof on consignment with a Loan Party in
compliance with Section 2-326 of the Uniform Commercial Code of the applicable
jurisdiction.

 

“Legal Requirement”: as to (a) any Person, any law, treaty, rule or regulation
or determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject, and (b) any property, any
law, treaty, rule, regulation, requirement, judgment, decree or determination of
any Governmental Authority applicable to or binding upon such property or to
which such property is subject.

 

“Lenders”: as defined in the preamble hereto.

 

“Leverage Ratio”: has the meaning ascribed in Section 7.1(b).

 

 

 
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“LIBOR Rate”: with respect to any Eurodollar Loan for any Interest Period
applicable thereto, (i) the rate per annum (rounded upward, if necessary, to the
nearest 1/16 of one percent) equal to the composite London Interbank Offered
Rate which appears on the Telerate page 3750 as of 11:00 a.m. London time on the
day that is two (2) London Banking Days preceding the first day of such Interest
Period (or if not reported thereon, then as determined by the Administrative
Agent from another recognized source or interbank quotation). In the event that
the Board of Governors of the Federal Reserve System shall impose a Reserve
Percentage with respect to LIBOR deposits of the Administrative Agent, then for
any period during which such Reserve Percentage shall apply, LIBOR shall be
equal to the amount determined above divided by an amount equal to one (1) minus
the Reserve Percentage. Notwithstanding the foregoing, if LIBOR (as determined
herein) would be less than zero percent (0%), then LIBOR shall be deemed to be
zero percent (0%). “Reserve Percentage” shall mean the maximum aggregate reserve
requirement (including all basic, supplemental, marginal and other reserves)
which is imposed on member banks of the Federal Reserve System against
“Euro-currency Liabilities” as defined in Regulation D.

 

“Lien”: any mortgage, pledge, hypothecation, assignment, deposit arrangement
(other than a bank or similar deposit account), encumbrance, lien (statutory or
other), or preference, priority or other security interest or similar
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
Financing Lease having substantially the same economic effect as any of the
foregoing, the filing of any financing statement under the Uniform Commercial
Code or comparable law of any jurisdiction in respect of any of the foregoing,
and, in the case of securities, a third party’s right to purchase such
securities).

 

“Line of Business”: means (i) procuring and supplying, manufacturing,
assembling, kitting and maintaining, repairing and overhauling, and (ii)
providing engineering and program and supply chain services with respect to,
aircraft parts and aerosystems principally for the United States Air Force and
other branches of the United States Armed Forces and for commercial aircraft
manufacturers and subcontractors.

 

“Loan Documents”: the collective reference to this Agreement, any Notes, the
Security Documents, any documents or instruments evidencing or governing the
Security Documents, each Guaranty Agreement (if any) and any other documents
executed in connection therewith (but specifically excluding any Secured Cash
Management Agreement and any Secured Swap Contract).

 

“Loan Parties”: means, collectively the Borrower, each Guarantor, each
indemnitor and/or each grantor party to any Security Document.

 

“Loans”: the collective reference to the Term Loan and the Revolving Credit
Loans.

 

“London Banking Day”: any day on which commercial banks are open for
international business (including dealing in U.S. Dollar ($) deposits) in
London, England and New York.

 

 

 
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“Material Adverse Effect”: a material adverse change in the business, assets,
operations, properties, condition (financial or otherwise), contingent
liabilities (including as to products, and whether such liabilities have been or
yet may be asserted), prospects or material agreements of the Borrower and its
Subsidiaries, taken as a whole.

 

“Moody’s”: Moody’s Investors Service, Inc. or any successor thereto.

 

“Multiemployer Plan”: a Plan which is a multiemployer plan as defined in Section
4001(a)(3) of ERISA.

 

“Net Cash Proceeds”: means, in each case as set forth in a statement in
reasonable detail delivered by the Borrower to the Administrative Agent: (a)
with respect to the disposition of assets by the Borrower or any Loan Party, the
excess, if any, of (1) the cash proceeds received in connection with such
disposition over (2) the sum of (A) the principal amount of any Indebtedness
(other than the Obligations) which is secured by such asset and which is
required to be repaid in connection with the disposition thereof, plus (B) the
reasonable out-of-pocket expenses incurred by the Borrower or such Loan Party,
as the case may be, in connection with such disposition, plus (C) provision for
taxes, including income taxes, attributable to the disposition of such asset;
and (b) with respect to any cash proceeds received by the Borrower or any Loan
Party in respect of the issuance of any Capital Stock or the incurrence of any
Indebtedness (except Indebtedness secured by purchase money liens), all such
cash proceeds, after deducting therefrom all reasonable and customary costs and
expenses incurred by the Borrower or such Loan Party directly in connection with
the issuance of such Capital Stock or the incurrence of Indebtedness.

 

“Net Income”: for any measuring period, the net income (or deficit) of the
Borrower and its Subsidiaries for such period (taken as a cumulative whole),
determined on a consolidated basis in accordance with GAAP; provided that any
non-cash extraordinary gains and losses in accordance with GAAP shall be
excluded in determining Net Income.

 

“Notes”: the collective reference to the Term Notes and the Revolving Credit
Notes.

 

“Notice of Transaction”: the form set forth in Exhibit I hereto.

 

“Obligations”: collectively, the unpaid principal of and interest on the Loans,
and all other obligations and liabilities of the Borrower to the Agent, and any
of the Lenders under or in connection with this Agreement, the other Loan
Documents and any Swap Contracts with any Lender or any Affiliate of a Lender
(including in each case, without limitation, interest accruing at the then
applicable rate provided in this Agreement or any other applicable Loan Document
or Swap Contract after the maturity of the Loans and interest accruing at the
then applicable rate provided in this Agreement or any other applicable Loan
Document or Swap Contract after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, this Agreement, the Notes, the
other Loan Documents or any Swap Contract with a Lender or any Affiliate of a
Lender or any other document made, delivered or given in connection therewith,
in each case whether on account of principal, interest, fees, indemnities,
costs, expenses or otherwise (including, without limitation, all reasonable fees
and disbursements of counsel to the Agents or to the Lenders).

 

 

 
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“OFAC”: as defined in Section 4.19.

 

“Other Connection Taxes”: means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Tax (other than connections arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to or enforced any
Loan Document, or sold or assigned an interest in any Loan or Loan Document).

 

“Other Taxes”: any and all present or future stamp or documentary taxes or any
other excise or property taxes, charges or similar levies arising from any
payment made hereunder or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.

 

“Participant Register”: as defined in Section 10.6(c).

 

“Participants”: as defined in Section 10.6(c).

 

“Patriot Act”: as defined in Section 10.17.

 

“PBGC”: the Pension Benefit Guaranty Corporation established pursuant to
Subtitle A of Title IV of ERISA or any successor thereto.

 

“Permitted Acquisition” shall mean any uncontested acquisition after the date of
this Agreement, by Borrower, of a domestic Person within the same Line of
Business as the Borrower by: merger, consolidation, purchase of a voting
majority of the stock or ownership interests of another Person, purchase of all
or substantially all of the assets of another Person or purchase of all or
substantially all of the assets of a domestic division or other domestic
operating component of another Person (an “Acquisition”) provided that all of
the following conditions have been satisfied:

 

(i)     The Administrative Agent shall have received a due diligence summary of
any proposed Acquisition in a form and content reasonably satisfactory to the
Administrative Agent including (1) target entity name and summary of
transaction, (2) historical revenues, list of acquired assets and liabilities
and business description of the target entity, and (3) purchase price (including
description of Seller Compensation) and copy of purchase agreement;

 

 

 
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(ii)     The Administrative Agent shall have received a set of projections and
information setting forth in reasonable detail the pro forma effect of such
Acquisition and showing compliance by the Borrower with all covenants set forth
in this Agreement, before and after giving effect to such Acquisition, for the
next succeeding fiscal year. The projections to be delivered hereunder shall
include and specify the assumptions used to prepare such projections, including
(without limitation) those regarding growth of sales, margins on sales and cost
savings resulting from such Acquisition;

 

(iii)     The Administrative Agent shall have received sufficient information on
the target entity and its principals, owners and any Person receiving Seller
Compensation to perform all necessary background, credit and other searches to
comply with Administrative Agent, credit and other policies and applicable law
and regulations, including (without limitation) those promulgated by OFAC; the
results of such searches must be satisfactory to the Administrative Agent, in
its reasonable discretion;

 

(iv)     The Administrative Agent shall have received a certificate signed by a
Responsible Officer to the effect that (and including calculations indicating
that) on a pro forma basis before and after giving effect to such Acquisition:
(a) all representations and warranties contained in the Loan Documents will
remain true and correct except those, if any, made as of a specific time which
shall have been true and correct when made, (b) the Borrower is in compliance
with and will remain in compliance with all covenants contained in the Loan
Documents, and (c) no Default or Event of Default has occurred and is continuing
or will occur as a result of the consummation of such Acquisition;

 

(v)     Such Acquisition, (I) in the case of a corporation being acquired, has
been (a) approved by the board of directors of such corporation which is the
subject of such Acquisition, (b) recommended for approval by such board to the
shareholders of such corporation and subsequently approved by such shareholders
as required under applicable law or the by-laws or the certificate of
incorporation of such corporation or (c) otherwise agreed to by all shareholders
of such corporation, or (II) in the case of any other Person, shall be agreed to
by all owners of such Person entitled to vote;

 

(vi)     No assumed liability (direct or indirect) of the target entity shall
cause a Default hereunder or shall have or cause a Material Adverse Effect upon
the Borrower or any other Loan Party;

 

(vii)   Any Seller Compensation shall be subordinated to the Obligations on
terms satisfactory to Administrative Agent, and shall be unsecured, or, if
secured, such Seller Compensation shall be fully subordinated to the Lenders
with no payments of principal or interest allowed;

 

(viii)   In connection with any Acquisition of equity interests of any Person,
all Liens on property of such Person shall be terminated unless the
Administrative Agent otherwise agrees in writing;

 

 

 
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(ix)     If the Acquisition results in the formation of a new Subsidiary of
Borrower or any other Loan Party, such Person becomes a Loan Party in accordance
with Section 6.9; and

 

(x)     If the Seller Compensation exceeds $1,500,000 whether individually or in
the aggregate for all Permitted Acquisitions during the term of this Agreement,
the Borrower shall obtain the Administrative Agent’s prior written consent to
the Acquisition.

 

For purposes of the definition of “Permitted Acquisitions,” the Administrative
Agent acknowledges and recognizes that the projections provided for and on
behalf of Borrower or any of the Loan Parties relating to any Acquisition will
be based upon good faith estimates and assumptions disclosed to the
Administrative Agent and believed by the Borrower to be likely and reasonable at
the time made, and such projections as to future events are not to be viewed as
a fact and that actual results during the period or periods covered by the
projections may differ from projected results.

 

“Person”: an individual, partnership, corporation, business trust, joint stock
company, limited liability company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.

 

“Plan”: any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which the Borrower, any of its
Subsidiaries or any ERISA Affiliate is (or, if such plan were terminated, would
under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section
3(5) of ERISA.

 

“Pledgee”: as defined in Section 10.16.

 

“Prime Rate”: the Prime Rate of interest per annum from time to time published
in the Money Rates section of The Wall Street Journal (Eastern Edition) as of a
determination date if a Business Date, or if not a Business Day, as of the
Business Day immediately prior thereto, or, in the discretion of Agent, the
base, reference or other rate then designated by Agent for general commercial
loan reference purposes, it being understood that such rate is a reference rate,
not necessarily the lowest, established from time to time, which serves as a
basis upon which effective interest rates are calculated for loans making
reference thereto (the “Index”). The Index is not necessarily the lowest rate
charged by Agent on its loans and is set by Agent in its sole discretion. If the
Index becomes unavailable during the term of this Agreement, Agent may designate
a substitute index after notifying the Borrower. Agent will tell the Borrower
the current Index rate upon the Borrower’s request. The interest rate change
will not occur more than each time as and when the Index changes.

 

“Prior Notes”: the notes under the Existing Credit Agreement.

 

“Prior Term Loans”: as defined in Section 2.5.

 

“Properties”: as defined in Section 4.15(a).

 

 

 
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“Recipient” means the Administrative Agent, any Lender or any other recipient of
any payment to be made by or on account of any obligation of any Loan Party
hereunder.

 

“Register”: as defined in Section 10.6(b).

 

“Related Parties”: with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.

 

“Release”: any spilling, leaking, pumping, pouring, emitting, emptying,
discharging, escaping, leaking, dumping, disposing, spreading, depositing or
dispersing of any Hazardous Materials in, unto or onto the environment.

 

“Required Lenders”: at any time (A) there are two or fewer non-Defaulting
Lenders, all of the non-Defaulting Lenders; and (B) there are more than two
non-Defaulting Lenders, at least two (2) non-Defaulting Lenders having a
combined Total Loan Percentage of 50.1% or more, provided however, that the Loan
Percentage of any Defaulting Lender shall be disregarded in determining Required
Lenders at any time.

 

“Requirement of Law”: as to (a) any Person, the certificate of incorporation and
by-laws or the partnership or limited partnership agreement or other
organizational or governing documents of such Person, and any law, treaty, rule
or regulation or determination of an arbitrator or a court or other Governmental
Authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject, and (b) any
property, any law, treaty, rule, regulation, requirement, judgment, decree or
determination of any Governmental Authority applicable to or binding upon such
property or to which such property is subject, including, without limitation,
any Environmental Laws.

 

“Responsible Officer”: with respect to any Loan Party, the chief operating
officer or any Financial Officer of such Loan Party.

 

“Restricted Payments”: as defined in Section 7.7.

 

“Revolving Credit Commitment”: as to any Revolving Lender at any time, its
obligation to make Revolving Credit Loans in an aggregate amount not to exceed
at any time outstanding the amount set forth opposite such Lender’s name in
Schedule I hereto under the heading “Revolving Credit Commitment,” as such
amount may be reduced from time to time pursuant to Section 2.4 and the other
applicable provisions hereof.

 

“Revolving Credit Commitment Percentage”: as to any Revolving Lender at any
time, the percentage which such Lender’s Revolving Credit Commitment then
constitutes of the Aggregate Revolving Credit Commitments (or, if the Revolving
Credit Commitments have terminated or expired at such time, the percentage which
(a) the Aggregate Revolving Credit Outstanding of such Lender at such time then
constitutes of (b) the Aggregate Revolving Credit Outstanding of all Lenders at
such time).

 

 

 
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“Revolving Credit Commitment Period”: the period from and including the Closing
Date to but not including the Revolving Credit Termination Date, or such earlier
date on which the Revolving Credit Commitments shall terminate as provided
herein.

 

“Revolving Credit Loan”: as defined in Section 2.1(a).

 

“Revolving Credit Note”: as defined in Section 3.16(d).

 

“Revolving Credit Termination Date”: March 23, 2019.

 

“Revolving Lender”: each Lender that has a Revolving Credit Commitment or that
holds Revolving Credit Loans.

 

“Sale and Leaseback Transaction”: means, with respect to any Loan Party or any
Subsidiary, any arrangement, directly or indirectly, with any Person whereby
such Loan Party or such Subsidiary shall sell or transfer any property used or
useful in its business, whether now owned or hereafter acquired, and thereafter
rent or lease such property or other property that it intends to use for
substantially the same purpose or purposes as the property being sold or
transferred.

 

“S&P”: Standard & Poor’s Ratings Group or any successor thereto.

 

“SEC”: the Securities and Exchange Commission.

 

“Secured Cash Management Agreement”: any Cash Management Agreement between any
Loan Party and any of its Subsidiaries and any Cash Management Bank.

 

“Secured Obligations”: (a) all Obligations, (b) all obligations arising under
Secured Cash Management Agreements and Secured Swap Contracts and (c) all costs
and expenses incurred in connection with enforcement and collection of the
foregoing, including the fees, charges and disbursements of counsel, in each
case whether direct or indirect (including those acquired by assumption),
absolute or contingent, due or to become due, now existing or hereafter arising
and including interest and fees that accrue after the commencement by or against
any Loan Party or any Affiliate thereof of any proceeding under any Debtor
Relief Laws naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding.

 

“Secured Party Designation Notice”: a notice from any Lender or an Affiliate of
a Lender substantially in the form of Exhibit G.

 

“Secured Parties”: collectively, the Administrative Agent, the Lenders, the Swap
Provider, the Cash Management Banks, the Indemnitees, each co-agent or sub-agent
appointed by the Administrative Agent from time to time pursuant to Article IX.

 

 

 
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“Secured Swap Contract”: any interest rate, currency, foreign exchange, or
commodity Swap Contract required or permitted under Article VI or VII between
any Loan Party and any of its Subsidiaries and the Swap Provider.

 

“Security Agreement” or “Security Agreements”: shall mean, collectively, the
general security agreements, and other security instruments, pledge agreements,
control agreements and documents (to the extent applicable) granting a Lien upon
or interest in all personal property of each Loan Party as more particularly
described therein, together with all other agreements and related documents of
the Loan Parties and certain obligors granting security interests to the
Administrative Agent upon the collateral described therein.

 

“Security Documents”: the collective reference to the Security Agreements,
landlord waivers, and each other security document or similar agreement that may
be delivered to the Administrative Agent pledging collateral security for any or
all of the Obligations, in each case as amended, supplemented or otherwise
modified from time to time.

 

“Seller Compensation”: shall mean, collectively, in connection with Permitted
Acquisitions, the sum of cash paid at closing, earn out compensation, purchase
money financing payable to seller, interest, or other post-closing payments and
assumed debt. For purposes of this definition, if any “earn out” provision in
any purchase agreement for any Permitted Acquisition does not provide for a
maximum payment, the amount shall be determined by the Administrative Agent, on
a reasonable basis, on the basis of the projections provided to the
Administrative Agent.

 

“Sold Receivables”: the accounts receivable of United Technologies Corporation
as further described in Schedule 7.3.

 

“Solvent”: with respect to any Person on a particular date, that on such date,
(a) the fair value of the property of such Person is greater than the total
amount of liabilities, including, without limitation, contingent liabilities, of
such Person, (b) the present fair salable value of the assets of such Person is
not less than the amount that will be required to pay the probable liability of
such Person on its debts as they become absolute and mature, (c) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person’s ability to pay as such debts and liabilities
mature, (d) such Person is not engaged in business or a transaction, and is not
about to engage in business or a transaction, for which such Person’s property
would constitute an unreasonably small amount of capital and (e) such Person is
able to pay its debts as they become due and payable.

 

“Statutory Reserve Rate”: a fraction (expressed as a decimal), the numerator of
which is the number one and the denominator of which is the number one minus the
aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the
Board to which the Administrative Agent is subject with respect to the
Eurodollar Rate, for eurocurrency funding (currently referred to as
“Eurocurrency Liabilities” in Regulation D of the Board). Such reserve
percentages shall include those imposed pursuant to such Regulation D.
Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be
subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender
under such Regulation D or any comparable regulation. The Statutory Reserve Rate
shall be adjusted automatically on and as of the effective date of any change in
any reserve percentage.

 

 

 
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“Subordinated Debt”: shall mean indebtedness of the Borrower or any of its
Subsidiaries, now existing or hereafter incurred, subordinated in right of
payment to the obligations to the Lenders under this Agreement, pursuant to
documentation containing maturities, amortization schedules, covenants,
defaults, remedies, subordination provisions and other material terms in form
and substance reasonably satisfactory to the Administrative Agent and the
Required Lenders.

 

“Subsidiary”: as to any Person, a corporation, partnership or other entity of
which shares of stock or other ownership interests having ordinary voting power
(other than stock or such other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of
directors or other managers of such corporation, partnership or other entity are
at the time owned, or the management of which is otherwise controlled, directly
or indirectly, through one or more intermediaries, or both, by such Person
(exclusive of any Affiliate in which such Person has a minority ownership
interest). Unless otherwise qualified, all references to a “Subsidiary” or to
“Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of
the Borrower, other than a Subsidiary that is inactive and has assets of no
material value.

 

“Swap Contract”: (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity
options, forward commodity contracts, equity or equity index swaps or options,
bond or bond price or bond index swaps or options or forward bond or forward
bond price or forward bond index transactions, interest rate options, forward
foreign exchange transactions, cap transactions, floor transactions, collar
transactions, currency swap transactions, cross-currency rate swap transactions,
currency options, spot contracts, or any other similar transactions or any
combination of any of the foregoing (including any options to enter into any of
the foregoing), whether or not any such transaction is governed by or subject to
any master agreement, and (b) any and all transactions of any kind, and the
related confirmations, which are subject to the terms and conditions of, or
governed by, any form of master agreement published by the International Swaps
and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement, including any such obligations or
liabilities under any Secured Swap Contract defined herein.

 

“Swap Contract Obligation”: any obligation of the Borrower under any one or more
Swap Contracts to make payments to the counterparties thereunder upon the
occurrence of a termination event or similar event thereunder.

 

 

 
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“Swap Provider”: BankUnited, N.A.

 

“Swap Termination Value”: in respect of any one or more Swap Contracts, after
taking into account the effect of any legally enforceable netting agreement
relating to such Swap Contracts, (a) for any date on or after the date such Swap
Contracts have been closed out and termination value(s) determined in accordance
therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market
value(s) for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).

 

“Synthetic Debt”: means, with respect to any Person as of any date of
determination thereof, all obligations of such Person in respect of transactions
entered into by such Person that are intended to function primarily as a
borrowing of funds (including any minority interest transactions that function
primarily as a borrowing) but are not otherwise included in the definition of
“Indebtedness” or as a liability on the consolidated balance sheet of such
Person and its Subsidiaries in accordance with GAAP.

 

“Synthetic Lease Obligation”: means the monetary obligation of a Person under
(a) a so-called synthetic, off-balance sheet or tax retention lease, or (b) an
agreement for the use or possession of property (including Sale and Leaseback
Transactions), in each case, creating obligations that do not appear on the
balance sheet of such Person but which, upon the application of any Debtor
Relief Laws to such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).

 

“Taxes”: any and all present or future taxes, levies, imposts, duties,
deductions, charges or withholdings imposed by any Governmental Authority.

 

“Term Commitment”: as to any Term Lender, the obligation of such Lender to make
a Term Loan to the Borrower in an aggregate amount not to exceed at any time
outstanding the amount set forth opposite such Lender’s name in Schedule I
hereto under the heading “Term Commitment”.

 

“Term Lenders”: each Lender that has a Term Commitment or that holds a Term Loan
together with the Swap Provider with respect to the Term Loans.

 

“Term Loan”: as defined in Section 2.6.

 

“Term Loan Maturity Date”: March 23, 2019.

 

“Term Loan Percentage”: as to any Term Lender at any time, the percentage which
the aggregate principal amount of such Lender’s Term Loans then outstanding
constitutes of the aggregate principal amount of the Term Loans then
outstanding.

 

 

 
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“Total Loan Percentage”: as to any Lender at any time, the percentage which the
sum of such Lender’s Term Loans then outstanding and Revolving Credit
Commitments then in effect (or, if the Revolving Credit Commitments have
terminated or expired at such time, such Lender’s Aggregate Revolving Credit
Outstanding) constitutes of the Aggregate Loans then outstanding.

 

“Term Note”: as defined in Section 3.16(d).

 

“Transferee”: as defined in Section 10.16.

 

“Type”: as to any Loan, its nature as a Base Rate Loan or a Eurodollar Loan.

 

“USA Agreements”: collectively, the documentation necessary for the Agent and
the Lenders to comply with Assignment of Claims Act (including, without
limitation, a notice of assignment) so as to maintain, inter alia, a first
priority security interest in the accounts receivables arising from any
Applicable USA Contract.

 

“Withdrawal Liability”: liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

 

1.2     Other Definitional Provisions.

 

(a)     All accounting terms not specifically or completely defined herein shall
be construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to
this Agreement shall be prepared in conformity with, GAAP applied on a
consistent basis, as in effect from time to time, applied in a manner consistent
with that used in preparing the Audited Financial Statements, except as
otherwise specifically prescribed herein. Notwithstanding the foregoing, for
purposes of determining compliance with any covenant (including the computation
of any financial covenant) contained herein, Indebtedness of the Borrower and
its Subsidiaries shall be deemed to be carried at 100% of the outstanding
principal amount thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on
financial liabilities shall be disregarded.

 

(b)     If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and either the
Borrower or the Required Lenders shall so request, the Administrative Agent, the
Lenders and the Borrower shall negotiate in good faith to amend such ratio or
requirement to preserve the original intent thereof in light of such change in
GAAP (subject to the approval of the Required Lenders); provided that, until so
amended, (i) such ratio or requirement shall continue to be computed in
accordance with GAAP prior to such change therein and (ii) the Borrower shall
provide to the Administrative Agent and the Lenders financial statements and
other documents required under this Agreement or as reasonably requested
hereunder setting forth a reconciliation between calculations of such ratio or
requirement made before and after giving effect to such change in GAAP.

 

 

 
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(c)     For purposes of this Agreement, Loans may be classified and referred to
by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by
Class and Type (e.g., a “Eurodollar Revolving Loan”). Borrowings also may be
classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type
(e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar
Revolving Borrowing”).

 

(d)     Unless otherwise specified therein, all terms defined in this Agreement
shall have the defined meanings when used in the Notes, the other Loan Documents
or any certificate or other document made or delivered pursuant hereto.

 

(e)     The words “hereof,” “herein” and “hereunder” and words of similar import
when used in this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement, and Section, Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.

 

(f)     The meanings given to terms defined herein shall be equally applicable
to both the singular and plural forms of such terms.

 

ARTICLE II:     AMOUNT AND TERMS OF COMMITMENTS AND TERM LOANS

 

2.1     Revolving Credit Commitments.

 

(a)     Subject to the terms and conditions hereof, each Revolving Lender
severally agrees to make revolving credit loans (each, a “Revolving Credit
Loan”) in U.S. Dollars to the Borrower from time to time during the Revolving
Credit Commitment Period so long as after giving effect thereto (i) the
Available Revolving Credit Commitment of each Lender with a Revolving Credit
Commitment is greater than or equal to zero and (ii) the Aggregate Revolving
Credit Outstanding of all Lenders does not exceed the Aggregate Revolving Credit
Commitments. During the Revolving Credit Commitment Period the Borrower may use
the Revolving Credit Commitments in accordance with Section 3.13 by borrowing,
prepaying the Revolving Credit Loans in whole or in part, and reborrowing, all
in accordance with the terms and conditions hereof.

 

(b)     The Revolving Credit Loans may from time to time be (i) Eurodollar
Loans, (ii) Base Rate Loans or (iii) a combination thereof, as determined by the
Borrower and notified to the Administrative Agent in accordance with Sections
2.2 and 3.2, provided that no Revolving Credit Loan shall be made as a
Eurodollar Loan after the day that is one month prior to the Revolving Credit
Termination Date.

 

(c)     Subject to the terms and conditions hereof, the Aggregate Revolving
Credit Commitments may be reduced pursuant to Section 2.4.

 

(d)     The number of Eurodollar Revolving Credit Loans outstanding at any time
shall be limited pursuant to Section 3.3.

 

 

 
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2.2     Procedure for Revolving Credit Borrowing. The Borrower may borrow under
the Revolving Credit Commitments during the Revolving Credit Commitment Period
on any Business Day, provided that the Borrower shall give the Administrative
Agent irrevocable notice in the form of a Notice of Transaction (which notice
must be received by the Administrative Agent prior to 12:00 noon (New York City
time) at least (a) three (3) Business Days prior to the requested Borrowing
Date, if all or any part of the requested Revolving Credit Loans are to be
initially Eurodollar Loans, or (b) one (1) Business Day prior to the requested
Borrowing Date, otherwise), specifying in each case (i) the amount to be
borrowed, (ii) the requested Borrowing Date, (iii) whether the borrowing is to
be of Eurodollar Loans, Base Rate Loans or a combination thereof and (iv) if the
borrowing is to be entirely or partly of Eurodollar Loans, the amount of such
Type of Loan and the length of the initial Interest Periods therefor. Each
borrowing under the Revolving Credit Commitments shall be in an amount equal to
(A) in the case of Base Rate Loans, $250,000.00 or a whole multiple of
$50,000.00 in excess thereof and (B) in the case of Eurodollar Loans,
$1,000,000.00 or a whole multiple of $500,000.00 in excess thereof. Upon receipt
of any such notice from the Borrower, the Administrative Agent shall promptly
notify each Revolving Lender thereof not later than 5:00 P.M., New York City
time, on the date the Administrative Agent receives such notice. Not later than
12:00 Noon, New York City time, on each requested Borrowing Date each Revolving
Lender shall wire an amount equal to its Revolving Credit Commitment Percentage
of the principal amount of the Revolving Credit Loans requested to be made on
such Borrowing Date available to the Administrative Agent at its office
specified in Section 10.2 in U.S. Dollars and in immediately available funds.
Revolving Credit Loans shall be advanced into Borrower’s Designated Account
unless otherwise instructed by Borrower in writing. The Administrative Agent
shall on such date credit the account of the Borrower on the books of such
office with the aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the Administrative Agent.

 

2.3     Repayment of Revolving Credit Loans. The Borrower hereby unconditionally
promises to pay to the Administrative Agent for the account of each Revolving
Lender the then unpaid principal amount of each Revolving Credit Loan of such
Lender (whether made before or after the termination or expiration of the
Revolving Credit Commitments) on the Revolving Credit Termination Date and on
such other dates and in such other amounts as may be required from time to time
pursuant to this Agreement, including, without limitation Section (g) of Section
3.1. The Borrower hereby further agrees to pay interest on the unpaid principal
amount of the Revolving Credit Loans from time to time outstanding until payment
thereof in full at the rates per annum, and on the dates, set forth in Section
3.1. Notwithstanding the foregoing, within three (3) Business Days of Borrower’s
receipt of each A-10 Contract Reimbursement Payment (if any), Borrower shall
then prepay the Revolving Credit Loans in the principal amount equal to one
hundred (100%) percent of the net proceeds (less any amounts due to
subcontractors related to the Boeing A-10 Wing Replacement Program) of each A-10
Contract Reimbursement Payment plus all accrued and unpaid interest through the
date of prepayment. Each Revolving Lender shall receive its Revolving Credit
Commitment Percentage of each installment of principal paid under the Revolving
Credit Loans.

 

2.4     Termination and Reduction of Revolving Credit Commitments. The Borrower
shall have the right, upon not less than three (3) Business Days’ notice to the
Administrative Agent (which shall promptly notify each Lender thereof), to
terminate the Aggregate Revolving Credit Commitments or, from time to time, to
reduce the amount of the Aggregate Revolving Credit Commitments; provided that
no such termination or reduction shall be permitted if, after giving effect
thereto and to any prepayments of the Revolving Credit Loans made on the
effective date thereof, the Available Revolving Credit Commitment of any Lender
would not be greater than or equal to zero. Any such permitted reduction shall
be in an amount equal to $1,000,000 or a whole multiple of $100,000 in excess
thereof and shall reduce permanently the Aggregate Revolving Credit Commitments
then in effect.

 

 

 
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2.5     Term Commitment. Subject to the terms and conditions hereof, pursuant to
Section 2.6 below, each Term Lender severally (but not jointly) agrees to make
the Term Loan (defined below) to the Borrower on the Closing Date in an amount
not to exceed in the aggregate the amount of the Term Commitment of each Term
Lender. On the Closing Date, Borrower shall refinance the outstanding principal
balance and Swap Termination Value of the term loan under the Existing Credit
Agreement.

 

2.6     Term Loan Borrowing. Subject to the terms and conditions hereof, upon
receipt by the Administrative Agent of the Proceeds of the Term Loan, each Term
Lender severally agrees to make available to the Borrower (through the
Administrative Agent) on the Closing Date its Term Loan Percentage of term loans
in the aggregate principal amount of $10,000,000 (the “Term Loan”). The Term
Loan shall be evidenced by a Term Note of the Borrower payable to each Term
Lender. Each Term Note shall be dated the Closing Date and shall mature on the
applicable Term Loan Maturity Date at which time the entire outstanding
principal balance and all interest thereon shall be due and payable. The Term
Loans shall bear interest at a rate per annum equal to the applicable Eurodollar
Rate for the applicable Interest Period or the Base Rate or combinations thereof
provided that each Eurodollar Term Loan shall be in an amount of $3,000,000.00
or a whole multiple of $500,000.00 in excess thereof pursuant to notices
delivered to Administrative Agent in the form of a Notice of Transaction in
accordance with Section 3.2. At Administrative Agent’s option and upon
Administrative Agent’s approval, the Borrower shall have a period of one hundred
eighty (180) days from closing to enter into a Secured Swap Contract with the
Swap Provider (or other provider acceptable to Administrative Agent) with
respect to the entire aggregate outstanding principal balance of the Term Loans
for the remainder of the term. Interest shall be payable in arrears on the
Interest Payment Date in accordance with Section 3.1 hereof. The number of Term
Loans outstanding at any one time shall be limited pursuant to Section 3.3
hereof. Prepayments shall be subject to Section 3.4 hereof. Each Term Note shall
be entitled to the benefits and subject to the provisions of this Agreement.

 

2.7     Repayment of Term Loan. The principal balance of the Term Loan shall be
payable to the Administrative Agent for the account of each Term Lender (in
accordance with each Term Lender’s respective Term Loan Percentage) in
consecutive monthly installments of principal, (i) the first twelve (12) of
which (payments 1 through 12) shall be in an amount equal to Forty One Thousand
Six Hundred Sixty-Six and 67/100 ($41,666.67) Dollars each, (ii) the next twelve
(12) of which (payments 13 through 24) shall be in an amount equal to One
Hundred Twenty-Five Thousand and 00/100 ($125,000.00) Dollars each and (iii) the
next eleven (11) of which (payments 25 through 35) shall be in an amount equal
to One Hundred Sixty-Six Thousand Six Hundred Sixty-Six and 67/100 ($166,666.67)
Dollars each; such payments (i) through (iii) commencing on May 1, 2016 with
each succeeding installment being due on the first Business Day of each month
thereafter until March 1, 2019 with a final payment due on the applicable Term
Loan Maturity Date in an amount equal to the then outstanding principal balance
of the Term Loan. Notwithstanding the foregoing, upon Borrower’s receipt of each
Contract Termination Payment (if any), Borrower shall then (at Borrower’s
option) either (1) prepay the Term Loan (which in the case of Eurodollar Term
Loans shall be on the last day of the current Interest Period) in the principal
amount equal to the Designated Amount plus all accrued and unpaid interest
through the date of prepayment, or (2) deposit into a bank account held by and
pledged (as additional collateral for the Loans and any related interest rate
swap obligations, if applicable) to the Agent on behalf of the Term Lenders, on
terms and documentation satisfactory to the Agent and its counsel, an amount
equal to the Designated Amount. Each Term Lender shall receive its Term Loan
Percentage of each installment of principal paid under the Term Loan.

 

 

 
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2.8      Reserved.

 

2.9     Defaulting Lenders.

 

(a)     Adjustments. Notwithstanding anything to the contrary contained in this
Agreement, if any Lender becomes a Defaulting Lender, then, until such time as
that Lender is no longer a Defaulting Lender, to the extent permitted by
applicable Law:

 

(i)     Waivers and Amendments. Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as set forth in the definition of “Required Lenders” and Section
10.1.

 

(ii)     Defaulting Lender Waterfall. Any payment of principal, interest, fees
or other amounts received by the Administrative Agent for the account of such
Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article VIII or otherwise) or received by the Administrative Agent from a
Defaulting Lender pursuant to Section 10.7 shall be applied at such time or
times as may be determined by the Administrative Agent as follows: first, to the
payment of any amounts owing by such Defaulting Lender to the Administrative
Agent hereunder; second, as the Borrower may request (so long as no Default or
Event of Default exists), to the funding of any Loan in respect of which such
Defaulting Lender has failed to fund its portion thereof as required by this
Agreement, as determined by the Administrative Agent; third, if so determined by
the Administrative Agent and the Borrower, to be held in a deposit account and
released pro rata in order to satisfy such Defaulting Lender’s potential future
funding obligations with respect to Loans under this Agreement and; fourth, to
the payment of any amounts owing to the Lenders, as a result of any judgment of
a court of competent jurisdiction obtained by any Lender, against such
Defaulting Lender as a result of such Defaulting Lender’s breach of its
obligations under this Agreement; fifth, so long as no Default or Event of
Default exists, to the payment of any amounts owing to the Borrower as a result
of any judgment of a court of competent jurisdiction obtained by the Borrower
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and sixth, to such Defaulting Lender or as
otherwise as may be required under the Loan Documents in connection with any
Lien conferred thereunder or directed by a court of competent jurisdiction;
provided that if (1) such payment is a payment of the principal amount of any
Loans in respect of which such Defaulting Lender has not fully funded its
appropriate share, and (2) such Loans were made when the conditions set forth in
Section 5 were satisfied or waived, such payment shall be applied solely to pay
the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being
applied to the payment of any Loans owed to such Defaulting Lender until such
time as all Loans are held by the Lenders pro rata in accordance with the
Commitments hereunder. Any payments, prepayments or other amounts paid or
payable to a Defaulting Lender that are applied (or held) to pay amounts owed by
a Defaulting Lender pursuant to this Section 2.9(a)(ii) shall be deemed paid to
and redirected by such Defaulting Lender, and each Lender irrevocably consents
hereto.

 

 

 
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(iii)     Certain Fees: No Defaulting Lender shall be entitled to receive any
fee payable under Section 3.5(a) for any period during which that Lender is a
Defaulting Lender (and the Borrower shall not be required to pay any such fee
that otherwise would have been required to have been paid to that Defaulting
Lender).

 

(b)     Defaulting Lender Cure. If the Borrower, the Administrative Agent,
agrees in writing that a Lender is no longer a Defaulting Lender, the
Administrative Agent will so notify the parties hereto, whereupon as of the
effective date specified in such notice and subject to any conditions set forth
therein, that Lender will, to the extent applicable, purchase at par that
portion of outstanding Loans of the other Lenders or take such other actions as
the Administrative Agent may determine to be necessary to cause the Loans be
held on a pro rata basis by the Lenders in accordance with their respective
Revolving Credit Commitment and Term Loan Percentages, whereupon such Lender
will cease to be a Defaulting Lender; provided that no adjustments will be made
retroactively with respect to fees accrued or payments made by or on behalf of
the Borrower while that Lender was a Defaulting Lender; and provided, further,
that except to the extent otherwise expressly agreed by the affected parties, no
change hereunder from Defaulting Lender to Lender will constitute a waiver or
release of any claim of any party hereunder arising from that Lender’s having
been a Defaulting Lender.

 

ARTICLE III:     GENERAL PROVISIONS

 

3.1

Interest Rates and Payment Dates.

 

(a)     Each Eurodollar Loan shall bear interest for each day during each
Interest Period with respect thereto at a rate per annum equal to the applicable
Eurodollar Rate determined for such Interest Period.

 

(b)     Each Base Rate Loan shall bear interest for each day on which it is
outstanding at a rate per annum equal to the Base Rate for such day.

 

 

 
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(c)     If all or a portion of (i) the principal amount of any Loan, (ii) any
interest payable thereon or (iii) any fee or other amount payable hereunder
shall not be paid when due (whether at the stated maturity, by acceleration or
otherwise), such amount shall bear interest for each day after the due date
until such amount is paid in full at a rate per annum equal to (x) in the case
of principal, the rate that would otherwise be applicable thereto pursuant to
the foregoing provisions of this Section plus 3% per annum or (y) in the case of
any such overdue interest, fee or other amount, the rate described in paragraph
(b) of this Section plus 3% per annum. If any Event of Default described in
Sections 8(c) (with respect to Section 7.1 only), (f), (h) or (j) shall occur
and be continuing, and the Required Lenders shall give notice to the Borrower
that this sentence shall apply, then, until such Event of Default shall be cured
or waived or such notice shall be withdrawn, the outstanding principal amount of
all Loans shall bear interest at 3% per annum above the rate that would
otherwise be applicable thereto pursuant to the foregoing provisions of this
Section 3.1 (other than the first sentence of this paragraph (c)).

 

(d)     Interest on Revolving Credit Loans and Term Loans shall be payable in
arrears on each Interest Payment Date, provided that interest accruing pursuant
to paragraph (c) of this Section 3.1 shall be payable from time to time on
demand.

 

(e)     On each date when the payment of any principal, interest or fees are due
hereunder or under any Note, Borrower agrees to maintain on deposit in an
ordinary checking account maintained by Borrower with the Administrative Agent,
which may be the Borrower’s Operating Account (Account #9853724601 with the
Administrative Agent, or such other account with Administrative Agent as shall
be designated by Borrower in a written notice to the Administrative Agent from
time to time, the “Designated Account”) an amount sufficient to pay such
principal, interest or fees in full on such date. Borrower hereby authorizes the
Administrative Agent (i) to deduct automatically all principal, interest or fees
when due hereunder or under any Note from the Designated Account, and (ii) if
and to the extent any payment of principal, interest or fees under this
Agreement or any Note is not made when due to deduct any such amount from any or
all of the accounts of Borrower maintained at the Administrative Agent. The
Administrative Agent agrees to provide written notice to Borrower of any
automatic deduction made pursuant to this Section 3.1(e) showing in reasonable
detail the amounts of such deduction.

 

(f)     If a Designated Account is established, all funds deposited in the
Designated Account shall be held under the sole dominion and control of the
Collateral Agent for the account of and subject to the security interest of the
Collateral Agent for the benefit of the Lenders. In addition to the rights of
the Collateral Agent in the funds on deposit in the Designated Account as
proceeds of the Collateral, the Borrower hereby pledges, assigns and grants to
the Collateral Agent a security interest in all funds, whether or not proceeds
of the Collateral, now or hereafter on deposit in the Designated Account and all
of the Borrower's present and future rights in and to the Designated Account and
the funds on deposit therein.

 

(g)     If a Designated Account is established, the Administrative Agent has the
right, and the Borrower hereby irrevocably authorizes the Administrative Agent,
to withdraw funds from and/or draw upon the Designated Account to pay amounts
due and owing to the Lenders under this Agreement, including, without
limitation, interest on and principal of Loans thereunder, and the fees set
forth in Section 3.5 payable thereunder. The Borrower hereby agrees that all
amounts deposited into the Designated Account or on deposit in the Designated
Account shall, on the Business Day that Obligations are due after receipt
thereof, be withdrawn by the Administrative Agent and either (i) if and solely
to the extent any amount is outstanding on such day in respect of Obligations
under any of the Loan Documents, such amounts on deposit in the Designated
Account shall be applied by the Agent to satisfy such outstanding Obligations
(and to the extent any such amounts on deposit in the Designated Account shall
not be required to satisfy Obligations, such amounts shall be treated as
provided for below) or (ii) if there are no Obligations at that time outstanding
(and provided no Default or Event of Default has occurred and is continuing),
upon Borrower’s written request to Administrative Agent, such amounts on deposit
in the Designated Account shall be transferred by the Agent to the Borrower's
main operating account (if different from the Designated Account) with the
Administrative Agent (the “Operating Account”). To the extent applicable, the
Borrower shall on the next succeeding Business Day advise the Administrative
Agent of the funds deposited to the Designated Account as cash for which the
Administrative Agent did not afford the Borrower credit against the Obligations
and the Administrative Agent shall make a retroactive adjustment for same. Upon
the occurrence and during the continuation of a Default or an Event of Default,
no amounts on deposit in the Designated Account shall be transferred by the
Collateral Agent, and any amounts on deposit therein may be used by the
Collateral Agent, at the Collateral Agent's discretion, to satisfy the
Obligations as provided for above, or may be held by the Collateral Agent as
cash collateral for the Obligations, as provided for above and in the Security
Agreement.

 

 

 
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(h)     Upon the occurrence and during the continuation of an Event of Default,
upon written direction from the Required Lenders, the Designated Account (if
any) shall be converted into a lockbox account under the sole dominion and
control of the Collateral Agent. In such event, the Borrower hereby agrees, on
forms approved by the Collateral Agent, if requested by Collateral Agent at the
direction of the Required Lenders, to instruct all Account Debtors to make all
payments in respect of Accounts directly to the lockbox account. This lockbox
account shall be non-interest bearing and shall be subject to debit or
withdrawal solely by the Collateral Agent. The balance from time to time in this
lockbox account shall be used to reduce the Obligations, at the Administrative
Agent’s sole discretion, and such balance shall be held as security for such
Obligations as provided in Section 3.1(g) hereof and in the Security Agreement.

 

(i)     The Designated Account and the funds on deposit therein shall be subject
to the Collateral Agent's right of setoff, Collateral Agent's lien and other
rights for the benefit of the Lenders as the Collateral Agent has in and to
deposit accounts maintained therein. Nothing contained herein shall be deemed to
be a waiver of any rights or remedies the Collateral Agent may have against the
Borrower or any funds of the Borrower on deposit at the Collateral Agent. No
failure of the Collateral Agent to require, and no delay by the Collateral Agent
in requiring, the Borrower to comply with any requirement of this Agreement
shall constitute a waiver of compliance with any requirement of this Agreement.
No failure of the Collateral Agent to exercise, and no delay by the Bank in
exercising, any right or any remedy, whether under this Agreement, at law or
otherwise shall constitute a waiver of any such right or remedy. Any waiver by
the Collateral Agent of compliance with a requirement of this Agreement, or of
any right or any remedy, shall be effective only if in a writing signed by the
Collateral Agent, and shall be limited to the specific instance for which such
waiver was granted and shall not constitute a waiver of such compliance, right
or remedy in the future or of compliance with any other requirement, or of any
other right or remedy, whether under this Agreement or otherwise.

 

 

 
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(j)     If, as a result of any restatement of or other adjustment to the
financial statements of Borrower or for any other reason, Borrower or the
Lenders determine that (i) the Financial Covenant used in the definition
“Applicable Margin” as calculated by Borrower as of any applicable date was
inaccurate and (ii) a proper calculation of such Financial Covenant would have
resulted in higher pricing for such period, Borrower shall immediately and
retroactively be obligated to pay to Agent for the account of the applicable
Lenders, promptly on demand by Agent (or, after the occurrence of an actual or
deemed entry of an order for relief with respect to Borrower under the
Bankruptcy Code of the United States, automatically and without further action
by Agent or any Lender), an amount equal to the excess of the amount of interest
and fees that should have been paid for such period over the amount of interest
and fees actually paid for such period. This paragraph shall not limit the
rights of Agent or any Lender, as the case may be, under Section 8 (inclusive)
hereunder or otherwise. Borrower’s obligations under this paragraph shall
survive the termination of the Commitments and the repayment of the Aggregate
Loans and all other Obligations hereunder.

 

3.2     Conversion and Continuation Options. With respect to Loans:

 

(a)     The Borrower may elect from time to time to convert outstanding
Eurodollar Loans (in whole or in part) to Base Rate Loans by giving the
Administrative Agent at least two (2) Business Days’ prior irrevocable notice of
such election pursuant to a Notice of Transaction, provided that any such
conversion of Eurodollar Loans may only be made on the last day of an Interest
Period with respect thereto. The Borrower may elect from time to time to convert
outstanding Base Rate Loans (in whole or in part) to Eurodollar Loans by giving
the Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, at least three (3) Business Days’ prior to the
proposed conversion date. Any such notice of conversion to Eurodollar Loans
shall specify the length of the initial Interest Period or Interest Periods
therefor. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof. All or any part of outstanding
Eurodollar Loans and Base Rate Loans may be converted as provided herein,
provided that (i) no Base Rate Loan may be converted into a Eurodollar Loan when
any Default or Event of Default has occurred and is continuing and the
Administrative Agent or the Required Lenders have determined in its or their
sole discretion that such conversion is not appropriate, (ii) any such
conversion may only be made if, after giving effect thereto, Section 3.3 shall
not have been violated, and (iii) no Base Rate Loan may be converted into a
Eurodollar Loan after the date that is one month prior to the Revolving Credit
Termination Date or the Term Loan Maturity Date, as applicable.

 

(b)     Any Eurodollar Loans may be continued as such upon the expiration of the
then current Interest Period with respect thereto by the Borrower giving notice
to the Administrative Agent of the length of the next Interest Period to be
applicable to such Loans determined in accordance with the applicable provisions
of the term “Interest Period” set forth in Section 1.1, provided that no
Eurodollar Loan may be continued as such (i) when any Default or Event of
Default has occurred and is continuing and the Administrative Agent or the
Required Lenders have determined in its or their sole discretion that such
continuation is not appropriate, (ii) if, after giving effect thereto, Section
3.3 would be contravened or (iii) after the date that is one month prior to the
Revolving Credit Termination Date or the Term Loan Maturity Date, as applicable;
and provided, further, that if the Borrower shall fail to give such notice or if
such continuation is not permitted pursuant to the preceding proviso, such
Eurodollar Loans shall automatically be converted to Base Rate Loans on the last
day of such then expiring Interest Period. Upon receipt of any notice pursuant
to this Section 3.2(b), the Administrative Agent shall promptly notify each
Lender thereof.

 

 

 
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3.3     Minimum Amounts; Maximum Number of Loans. All borrowings, conversions
and continuations of Loans hereunder and all selections of Interest Periods
hereunder shall be in such amounts and be made pursuant to such elections so
that, after giving effect thereto: (a) for the Revolving Credit Loans (i) not
more than six (6) Interest Periods shall be outstanding at any time and (ii) the
aggregate principal amount of the Eurodollar Loans comprising each Interest
Period shall be equal to $1,000,000 or an integral multiple of $500,000 in
excess thereof; and (b) for the Term Loans (i) not more than four (4) Interest
Periods shall be outstanding at any time and (ii) the aggregate principal amount
of the Eurodollar Loans comprising the Term Loans shall be equal to the lesser
of (1) the aggregate remaining principal balance of the Term Loans or (2)
$3,000,000 or an integral multiple thereof.

 

3.4     Optional and Mandatory Prepayments.

 

(a)     The Borrower may at any time and from time to time prepay the Loans, in
whole or in part, upon at least three (3) Business Days’ irrevocable notice to
the Administrative Agent (in the case of Eurodollar Loans) and at least one (1)
Business Day’s irrevocable notice to the Administrative Agent (in the case of
Base Rate Loans), specifying the date and amount of prepayment and whether the
prepayment is of Eurodollar Loans, Base Rate Loans or a combination thereof,
and, in each case if a combination thereof, the amount allocable to each. Upon
the receipt of any such notice the Administrative Agent shall promptly notify
each Lender thereof. If any such notice is given, the amount specified in such
notice shall be due and payable on the date specified therein. Partial
prepayments of the Loans shall be in an aggregate principal amount of $100,000
or an integral multiple thereof.

 

(b)     Amounts to be applied in connection with prepayments made pursuant to
this Section shall be applied to the prepayment of the Term Loans in accordance
with Section 3.8(a)(ii) and shall be made, first, to Base Rate Loans and,
second, to Eurodollar Loans.

 

(c)     If, at any time during the Revolving Credit Commitment Period, for any
reason the Aggregate Revolving Credit Outstanding of all the Revolving Lenders
exceeds the Aggregate Revolving Credit Commitments then in effect, or the
Aggregate Revolving Credit Outstanding of any Lender exceeds the Revolving
Credit Commitment of such Lender then in effect, the Borrower shall, without
notice or demand, immediately prepay the Revolving Credit Loans, in an aggregate
amount at least sufficient to eliminate any such excess.

 

 

 
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(d)     On each date on which the Revolving Credit Loans exceed any borrowing
limitations set forth herein, the Borrower shall repay or prepay such principal
amount of the outstanding Revolving Credit Loans, if any (together with interest
accrued thereon and any amount due under this Section 3.4), as may be necessary
so that after such payment the Revolving Credit Loans do not exceed such
borrowing limitations. Each such payment or prepayment shall be applied ratably
to the Revolving Credit Loans of the Lenders outstanding on the date of payment
or prepayment, first, to Base Rate Loans, and, next, to Eurodollar Loans.

 

(e)     Contemporaneously upon receipt of Net Cash Proceeds in excess of
$500,000, unless a Default or Event of Default then exists (in which event,
Section 3.8 shall be controlling), the Borrower shall pay to the Administrative
Agent an amount equal to: (i) the sum of (x) seventy-five percent (75%) of all
Net Cash Proceeds in the aggregate in any Fiscal Year from the disposition of
assets whether or not such assets are Collateral hereunder, other than Inventory
Collateral and Sold Receivables, plus (y) seventy-five percent (75%) of the Net
Cash Proceeds in the aggregate in any Fiscal Year from the disposition of
Equipment Collateral, and Properties to the extent such Net Cash Proceeds are
not used substantially simultaneously to replace such disposed Equipment
Collateral and disposed Properties with new Equipment Collateral, or new
Properties, as the case may be, and (ii) seventy-five percent (75%) of the Net
Cash Proceeds from the incurrence of Indebtedness. Such payment shall be
accompanied by a detailed calculation showing all deductions from gross proceeds
in order to arrive at Net Cash Proceeds, as well as amounts used or reserved for
the purchase of replacement Equipment Collateral, if applicable. All such
payments from Net Cash Proceeds shall be applied, first, (A) pro rata, to either
(1) prepay the Term Loans then outstanding, in prepayment of the principal
installments thereof in inverse order of maturity, or (2) to deposit such amount
into a bank account held by and pledged (as additional collateral for the Loans
and any related interest rate swap obligations) to the Agent on behalf of the
Term Lenders on terms and documentation satisfactory to Agent and its counsel;
and (B) next, as to any remainder, to the Revolving Credit Loans.

 

(f)     Each prepayment of Loans pursuant to this Section 3.4 shall be
accompanied by accrued and unpaid interest on the amount prepaid to the date of
prepayment and any amounts payable under Section 3.11 or 3.15 in connection with
such prepayment.

 

(g)     Each prepayment of any Term Loan shall be subject to any Swap
Termination Value for prepayments pursuant to a Swap Contract (if applicable).

 

(h)     Upon Borrower’s receipt of (i) each Contract Termination Payment (if
any), Borrower shall comply with the prepayment or cash security provisions of
Section 2.7; and (ii) each A-10 Contract Reimbursement Payment (if any),
Borrower shall comply with the prepayment provisions of Section 2.3.

 

(i)     If the Borrower decides to proceed with a public offering of its stock
and (1) raises $10,000,000 or more, and (2) after giving effect to the receipt
of the net proceeds of such public offering Borrower’s Leverage Ratio is 2.0 or
more, Borrower shall then promptly utilize an amount equal to 25% of Borrower’s
Net Cash Proceeds from such offering to pay down the outstanding Revolving
Credit Loans.

 

 

 
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3.5     Commitment Fees; Other Fees.

 

(a)     The Borrower shall pay to the Administrative Agent for the account of
each Revolving Lender in accordance with its Revolving Credit Commitment
Percentage, a commitment fee equal to the Commitment Fee set forth in the
Applicable Percentage definition times the actual daily amount by which the
Aggregate Revolving Credit Commitment exceeds the Aggregate Revolving Credit
Outstanding. The commitment fee shall accrue at all times during the relevant
period that the Revolving Credit Commitments are outstanding including at any
time during which one or more of the conditions in Section 5 (inclusive) is not
met, and shall be due and payable quarterly in arrears on the first Business Day
of each April, July, October and January, commencing with the first such date to
occur after the Closing Date and on the last day of the Revolving Credit
Commitment Period.

 

(b)     The Borrower shall pay to the Agent for the pro rata account of each
Lender on the Closing Date the up front fees set forth in the Agent Fee Letter
and the fee letter dated the date hereof with each Lender (other than the
Agent). Such fees shall be fully earned when paid and shall be nonrefundable for
any reason whatsoever.

 

(c)     Borrower shall pay to Agent for Agent’s own account, fees in the amounts
and at the times specified in the letter agreement, dated the date hereof (the
“Agent Fee Letter”), between Borrower and Agent. Such fees shall be fully earned
when paid and shall be nonrefundable for any reason whatsoever.

 

3.6     Computation of Interest and Fees.

 

(a)     Interest and fees shall be calculated on the basis of a 360-day year for
the actual days elapsed (including the first day but excluding the last day).
The Administrative Agent shall as soon as practicable notify the Borrower and
the relevant Lenders of each determination of a Eurodollar Rate. Any change in
the interest rate on a Loan resulting from a change in the Base Rate shall
become effective as of the opening of business on the day on which such change
becomes effective. The Administrative Agent shall as soon as practicable notify
the Borrower and the relevant Lenders of the effective date and the amount of
each such change in the Base Rate.

 

(b)     Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower deliver to the
Borrower a statement showing in reasonable detail the calculations used by the
Administrative Agent in determining any interest rate pursuant to Section 3.1.

 

3.7     Inability to Determine Interest Rate. If prior to the first day of any
Interest Period:

 

(a)     the Administrative Agent shall have determined (which determination
shall be conclusive and binding upon the Borrower) that, by reason of
circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or

 

 

 
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(b)     the Administrative Agent has received notice from the Required Lenders
that the Eurodollar Rate determined or to be determined for such Interest Period
will not adequately and fairly reflect the cost to such Lenders of making or
maintaining their Eurodollar Loans during such Interest Period, the
Administrative Agent shall give telecopy or telephonic notice thereof to the
Borrower and the Lenders as soon as practicable thereafter. If such notice is
given (i) any Eurodollar Loans requested to be made on the first day of such
Interest Period shall be made as Base Rate Loans in U.S. Dollars, (ii) any Loans
that were to have been converted on the first day of such Interest Period to or
continued as Eurodollar Loans shall be converted to or continued as Base Rate
Loans and (iii) any outstanding Eurodollar Loans shall be converted on the last
day of such Interest Period to Base Rate Loans. Until such notice has been
withdrawn by the Administrative Agent, no further Eurodollar Loans shall be made
or continued as such, nor shall the Borrower have the right to convert Base Rate
Loans to Eurodollar Loans.

 

3.8     Pro Rata Treatment and Payments.

 

(a)     (i) Each borrowing of Loans by the Borrower from the Lenders hereunder
shall be made pro rata according to the Term Loan Percentages or Revolving
Credit Commitment Percentages, as applicable, of the relevant Lenders in effect
on the date of such borrowing.

 

(ii)     Each payment (including each prepayment) by the Borrower, on account of
principal of and interest on the Term Loans shall be made pro rata according to
the respective outstanding principal amounts of the Term Loans then held by the
Term Lenders. The amount of each principal prepayment of the Term Loans shall be
applied in inverse order of maturity to reduce the then remaining installments
of the Term Loans pro rata based upon the respective then outstanding principal
amounts thereof. Amounts prepaid on account of the Term Loans may not be
reborrowed.

 

(iii)     Each payment (including each prepayment) by the Borrower on account of
principal of and interest on the Revolving Credit Loans shall be made pro rata
according to the respective outstanding principal amounts of the Revolving
Credit Loans then held by the Revolving Lenders.

 

(iv)     Each payment by the Borrower on account of any commitment fee hereunder
shall be allocated by the Administrative Agent among the Revolving Lenders pro
rata in accordance with the Revolving Credit Commitment Percentages of the
Lenders as of such date.

 

 

 
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(v)     Any reduction of the Revolving Credit Commitments of the Lenders shall
be allocated by the Administrative Agent among the Lenders pro rata according to
the Revolving Credit Commitment Percentages of the Lenders on the date of such
reduction.

 

(vi)     All payments (including prepayments) to be made by the Borrower in
respect of Loans hereunder, whether on account of principal, interest, fees or
otherwise, shall be made without set-off or counterclaim and shall be made prior
to 12:00 Noon, New York City time, on the due date thereof to the Administrative
Agent, for the account of the Lenders entitled thereto, at the Administrative
Agent’s office specified in Section 10.2, in U.S. Dollars and in immediately
available funds. The Administrative Agent shall distribute such payments to the
Lenders entitled to receive the same promptly upon receipt in like funds as
received.

 

(vii)     If any payment hereunder (other than payments on the Eurodollar Loans)
becomes due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day, and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension. If any payment on a Eurodollar Loan
becomes due and payable on a day other than a Business Day, the maturity of such
payment shall be extended to the next succeeding Business Day (and, with respect
to payments of principal, interest thereon shall be payable at the then
applicable rate during such extension) unless the result of such extension would
be to extend such payment into another calendar month, in which event such
payment shall be made on the immediately preceding Business Day.

 

(b)     Unless the Administrative Agent shall have been notified in writing by
any Lender prior to a Borrowing Date that such Lender will not make the amount
that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon at a
rate per annum equal to the daily average Federal Funds Effective Rate for the
period until such Lender makes such amount immediately available to the
Administrative Agent. A certificate of the Administrative Agent submitted to any
Lender with respect to any amounts owing under this Section shall be conclusive
in the absence of manifest error. If such Lender’s share of such borrowing is
not made available to the Administrative Agent by such Lender within three (3)
Business Days of such Borrowing Date, the Borrower shall repay such Lender’s
share of such borrowing (together with interest thereon from the date such
amount was made available to the Borrower) at the rate per annum applicable to
Base Rate Loans hereunder to the Administrative Agent not later than three (3)
Business Days after receipt of written notice from the Administrative Agent
specifying such Lender’s share of such borrowing that was not made available to
such Administrative Agent, and the Borrower shall have the right to pursue any
remedies against such Lender for its failure to make its portion of such
borrowing available.

 

 

 
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(c)     Unless the Administrative Agent shall have been notified in writing by
the Borrower prior to a date on which a payment is due from the Borrower
hereunder that the Borrower will not make such payment available to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the applicable
Lenders a corresponding amount. If such amount is not made available to the
Administrative Agent by the required time on the due date therefor, each
applicable Lender shall pay to the Administrative Agent, on demand, such amount
with interest thereon at a rate per annum equal to the daily average Federal
Funds Effective Rate for the period until such Lender makes such amount
immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this Section shall be conclusive in the absence of manifest error.

 

(d)     If any Lender shall, by exercising any right of setoff or counterclaim
or otherwise, obtain payment in respect of (a) Obligations in respect of any of
the Facilities due and payable to such Lender hereunder and under the other Loan
Documents at such time in excess of its ratable share (according to the
proportion of (i) the amount of such Obligations due and payable to such Lender
at such time to (ii) the aggregate amount of the Obligations in respect of the
Facilities due and payable to all Lenders hereunder and under the other Loan
Documents at such time) of payments on account of the Obligations in respect of
the Facilities due and payable to all Lenders hereunder and under the other Loan
Documents at such time obtained by all the Lenders at such time or
(c) Obligations in respect of any of the Facilities owing (but not due and
payable) to such Lender hereunder and under the other Loan Documents at such
time in excess of its ratable share (according to the proportion of (i) the
amount of such Obligations owing (but not due and payable) to such Lender at
such time to (ii) the aggregate amount of the Obligations in respect of the
Facilities owing (but not due and payable) to all Lenders hereunder and under
the other Loan Documents at such time) of payments on account of the Obligations
in respect of the Facilities owing (but not due and payable) to all Lenders
hereunder and under the other Loan Documents at such time obtained by all of the
Lenders at such time, then, in each case under clauses (a) and (b) above, the
Lender receiving such greater proportion shall (A) notify the Administrative
Agent of such fact, and (B) purchase (for cash at face value) participations in
the Loans of the other Lenders, or make such other adjustments as shall be
equitable, so that the benefit of all such payments shall be shared by the
Lenders ratably in accordance with the aggregate amount of Obligations in
respect of the Facilities then due and payable to the Lenders or owing (but not
due and payable) to the Lenders, as the case may be, provided that:

 

(1)     if any such participations are purchased and all or any portion of the
payment giving rise thereto is recovered, such participations shall be rescinded
and the purchase price restored to the extent of such recovery, without
interest; and

 

(2)     the provisions of this Section shall not be construed to apply to
(x) any payment made by or on behalf of the Borrower pursuant to and in
accordance with the express terms of this Agreement (including the application
of funds arising from the existence of a Defaulting Lender).

 

 

 
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Each Loan Party consents to the foregoing and agrees, to the extent it may
effectively do so under applicable Law, that any Lender acquiring a
participation pursuant to the foregoing arrangements may exercise against such
Loan Party rights of setoff and counterclaim with respect to such participation
as fully as if such Lender were a direct creditor of such Loan Party in the
amount of such participation.

 

3.9     Illegality. Notwithstanding any other provision herein, if the adoption
of or any change in any Legal Requirement or in the interpretation or
application thereof shall make it unlawful for any Lender to make or maintain
Eurodollar Loans as contemplated by this Agreement, (a) the commitment of such
Lender hereunder to make Eurodollar Loans, continue Eurodollar Loans as such and
convert Base Rate Loans to Eurodollar Loans shall forthwith be cancelled until
such time as it shall no longer be unlawful for such Lender to make or maintain
the affected Loans and (b) such Lender’s Loans then outstanding as Eurodollar
Loans, if any, shall be converted automatically to Base Rate Loans on the
respective last days of the then current Interest Periods with respect to such
Eurodollar Loans or within such earlier period as may be required by law. If any
such conversion of a Eurodollar Loan occurs on a day which is not the last day
of the then current Interest Period with respect thereto, the Borrower shall pay
to such Lender such amounts, if any, as may be required pursuant to Section
3.11.

 

3.10     Increased Costs.

 

(a)     In the event that the adoption of or any change in any Legal Requirement
(or in the interpretation or application thereof) or compliance by any Lender
with any request or directive (whether or not having the force of law) from any
central bank or other Governmental Authority:

 

(ii)     does or shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement, any Note, any Loans made by it, or change the basis
of taxation of payments to such Lender of principal, fees, interest or any other
amount payable hereunder (except for (A) changes in the rate of tax on the
overall net income or profits of such Lender, (B) any tax to the extent that the
Borrower is or would be required to pay an additional amount with respect to
such tax under Section 3.12 or (C) any tax with respect to which the Borrower
would not be required to pay an additional amount under Section 3.12 because
payment of such additional amount with respect to such tax would be specifically
excluded thereunder);

 

(iii)     does or shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by, or
deposits or other liabilities in or for the account of, advances or loans by, or
other credit extended by, or any other acquisition of funds by, any office of
such Lender which are not otherwise included in the determination of the
Eurodollar Rate; or

 

(iv)     does or shall impose on such Lender any other condition affecting this
Agreement or the Loans made by any Lender; and the result of any of the
foregoing is to increase the cost to such Lender, by any amount which such
Lender deems to be material, of making, renewing, maintaining or participating
in advances or extensions of credit or to reduce any amount receivable
hereunder, in each case in respect of its Loans, then, in any such case, the
Borrower shall promptly pay such Lender, upon receipt of its demand setting
forth in reasonable detail, any additional amounts necessary to compensate such
Lender for such additional cost or reduced amount receivable, together with
interest on each such amount from the date two (2) Business Days after the date
demanded until payment in full thereof at the Base Rate. A certificate as to any
additional amounts payable pursuant to the foregoing sentence submitted by such
Lender, through the Administrative Agent, to the Borrower shall be conclusive in
the absence of manifest error. This covenant shall survive the termination of
this Agreement and payment of all amounts outstanding hereunder for a period of
one (1) year.

 

 

 
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(b)     The Borrower will pay any Lender, on demand, for such Lender’s costs or
losses arising from any Change in Law which are allocated to this Agreement or
any credit outstanding under this Agreement. The allocation will be made as
determined by such Lender, using any reasonable method. The costs include,
without limitation, the following:

 

(i)     any reserve or deposit requirements (excluding any reserve requirement
already reflected in the calculation of the interest rate in this Agreement);
and

 

(ii)     any capital requirements relating to the Lender’s assets and
commitments for credit.

 

“Change in Law” means the occurrence, after the date of this Agreement, of the
adoption or taking effect of any new or changed law, rule, regulation or treaty,
or the issuance of any request, rule, guideline or directive (whether or not
having the force of law) by any Governmental Authority; provided that (x) the
Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests,
rules, guidelines or directives issued in connection with that Act, and (y) all
requests, rules guidelines or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor authority) or the United States regulatory authorities, in each case
pursuant to Basel III, shall in each case be deemed to be a “Change in Law”,
regardless of the date enacted, adopted or issued.

 

(c)     Any request by any Lender for compensation under this Section 3.10 shall
be accompanied by a certificate of a duly authorized officer of such Lender
setting forth such information and calculations supporting such request as such
Lender shall customarily provide in similar situations.

 

(d)     Failure or delay on the part of any Lender to demand compensation
pursuant to this Section 3.10 shall not constitute a waiver of such Lender’s
right to demand such compensation.

 

3.11     Indemnity. Without duplication of the provisions of Section 3.15, the
Borrower agrees to indemnify each Lender and to hold each Lender harmless from
any loss or expense which such Lender may sustain or incur as a consequence of
(a) default by the Borrower in payment when due of the principal amount of or
interest on any Loans of such Lender, (b) default by the Borrower in any
borrowing, continuation or conversion after the Borrower has given a notice of
borrowing, a notice of continuation or a notice of conversion in accordance with
this Agreement, (c) default by the Borrower in making any prepayment after the
Borrower has given a notice in accordance with this Agreement or (d) the making
of a prepayment, continuation or conversion of a Eurodollar Loan on a day which
is not the last day of an Interest Period with respect thereto, including,
without limitation, in each case, any such loss or expense arising from the
reemployment of funds obtained by it to maintain its Eurodollar Loans hereunder
or from fees payable to terminate the deposits from which such funds were
obtained, but excluding, in each case, lost profit. A certificate as to any
amounts payable pursuant to this Section 3.11, submitted by a Lender to the
Borrower shall be conclusive in the absence of manifest error. This covenant
shall survive termination of this Agreement and payment of all amounts
outstanding hereunder.

 

 

 
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3.12     Taxes.

 

(a)     Payments Free of Taxes; Obligation to Withhold; Payments on Account of
Taxes.

 

(i)     Any and all payments by or on account of any obligation of any Loan
Party under any Loan Document shall be made without deduction or withholding for
any Taxes, except as required by applicable Laws. If any applicable Laws (as
determined in the good faith discretion of the Administrative Agent) require the
deduction or withholding of any Tax from any such payment by the Administrative
Agent or a Loan Party, then the Administrative Agent or such Loan Party shall be
entitled to make such deduction or withholding, upon the basis of the
information and documentation to be delivered pursuant to subsection (e) below.

 

(ii)     If any Loan Party or the Administrative Agent shall be required by the
Code to withhold or deduct any Taxes, including both United States federal
backup withholding and withholding taxes, from any payment, then (A) the
Administrative Agent shall withhold or make such deductions as are determined by
the Administrative Agent to be required based upon the information and
documentation it has received pursuant to subsection (e) below, (B) the
Administrative Agent shall timely pay the full amount withheld or deducted to
the relevant Governmental Authority in accordance with the Code, and (C) to the
extent that the withholding or deduction is made on account of Indemnified
Taxes, the sum payable by the applicable Loan Party shall be increased as
necessary so that after any required withholding or the making of all required
deductions (including deductions applicable to additional sums payable under
this Section 3.12) the applicable Recipient receives an amount equal to the sum
it would have received had no such withholding or deduction been made.

 

(iii)     If any Loan Party or the Administrative Agent shall be required by any
applicable Laws other than the Code to withhold or deduct any Taxes from any
payment, then (A) such Loan Party or the Administrative Agent, as required by
such Laws, shall withhold or make such deductions as are determined by it to be
required based upon the information and documentation it has received pursuant
to subsection (e) below, (B) such Loan Party or the Administrative Agent, to the
extent required by such Laws, shall timely pay the full amount withheld or
deducted to the relevant Governmental Authority in accordance with such Laws,
and (C) to the extent that the withholding or deduction is made on account of
Indemnified Taxes, the sum payable by the applicable Loan Party shall be
increased as necessary so that after any required withholding or the making of
all required deductions (including deductions applicable to additional sums
payable under this Section 3.12) the applicable Recipient receives an amount
equal to the sum it would have received had no such withholding or deduction
been made.

 

 

 
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(b)     Payment of Other Taxes by the Loan Parties. Without limiting the
provisions of subsection (a) above, the Loan Parties shall timely pay to the
relevant Governmental Authority in accordance with applicable law, or at the
option of the Administrative Agent timely reimburse it for the payment of, any
Other Taxes.

 

(c)     Tax Indemnifications.

 

(i)     Each of the Loan Parties shall, and does hereby, jointly and severally
indemnify each Recipient, and shall make payment in respect thereof within
ten (10) days after demand therefor, for the full amount of any Indemnified
Taxes (including Indemnified Taxes imposed or asserted on or attributable to
amounts payable under this Section 3.12) payable or paid by such Recipient or
required to be withheld or deducted from a payment to such Recipient, and any
penalties, interest and reasonable expenses arising therefrom or with respect
thereto, whether or not such Indemnified Taxes were correctly or legally imposed
or asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to the Borrower by a Lender (with
a copy to the Administrative Agent), or by the Administrative Agent on its own
behalf or on behalf of a Lender, shall be conclusive absent manifest error. Each
of the Loan Parties shall also, and does hereby, jointly and severally indemnify
the Administrative Agent, and shall make payment in respect thereof within ten
(10) days after demand therefor, for any amount which a Lender for any reason
fails to pay indefeasibly to the Administrative Agent as required pursuant to
Section 3.12(c)(ii) below.

 

(ii)     Each Lender shall, and does hereby, severally indemnify and shall make
payment in respect thereof within ten (10) days after demand therefor, (A) the
Administrative Agent against any Indemnified Taxes attributable to such Lender
(but only to the extent that any Loan Party has not already indemnified the
Administrative Agent for such Indemnified Taxes and without limiting the
obligation of the Loan Parties to do so), (B) the Administrative Agent and the
Loan Parties, as applicable, against any Taxes attributable to such Lender’s
failure to comply with the provisions of Section 10.6(c) relating to the
maintenance of a Participant Register and (C) the Administrative Agent and the
Loan Parties, as applicable, against any Excluded Taxes attributable to such
Lender, in each case, that are payable or paid by the Administrative Agent or a
Loan Party in connection with any Loan Document, and any reasonable expenses
arising therefrom or with respect thereto, whether or not such Taxes were
correctly or legally imposed or asserted by the relevant Governmental Authority.
A certificate as to the amount of such payment or liability delivered to any
Lender by the Administrative Agent shall be conclusive absent manifest error.
Each Lender hereby authorizes the Administrative Agent to set off and apply any
and all amounts at any time owing to such Lender, as the case may be, under this
Agreement or any other Loan Document against any amount due to the
Administrative Agent under this clause (ii).

 

 

 
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(d)     Evidence of Payments. As soon as practicable after any payment of Taxes
by any Loan Party to a Governmental Authority, as provided in this Section 3.12,
the Borrower shall deliver to the Administrative Agent the original or a
certified copy of a receipt issued by such Governmental Authority evidencing
such payment, a copy of any return reporting such payment or other evidence of
such payment reasonably satisfactory to the Administrative Agent.

 

(e)     Status of Lenders; Tax Documentation.

 

(i)     Any Lender that is entitled to an exemption from or reduction of
withholding Tax with respect to payments made under any Loan Document shall
deliver to the Borrower and the Administrative Agent, at the time or times
reasonably requested by the Borrower or the Administrative Agent, such properly
completed and executed documentation reasonably requested by the Borrower or the
Administrative Agent as will permit such payments to be made without withholding
or at a reduced rate of withholding. In addition, any Lender, if reasonably
requested by the Borrower or the Administrative Agent, shall deliver such other
documentation prescribed by applicable Law or reasonably requested by the
Borrower or the Administrative Agent as will enable the Borrower or the
Administrative Agent to determine whether or not such Lender is subject to
backup withholding or information reporting requirements. Notwithstanding
anything to the contrary in the preceding two sentences, the completion,
execution and submission of such documentation (other than such documentation
set forth in Section 3.12(e)(ii)(A), (ii)(B) and (ii)(D) below) shall not be
required if in the Lender’s reasonable judgment such completion, execution or
submission would subject such Lender to any material unreimbursed cost or
expense or would materially prejudice the legal or commercial position of such
Lender.

 

(ii)     Without limiting the generality of the foregoing, in the event that the
Borrower is a U.S. Person,

 

(A)     any Lender that is a U.S. Person shall deliver to the Borrower and the
Administrative Agent on or prior to the date on which such Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the
reasonable request of the Borrower or the Administrative Agent), executed copies
of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup
withholding tax;

 

(B)     any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), whichever of the following is applicable:

 

 

 
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(1)     in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, executed copies of IRS Form W-8BEN-E (or
W-8BEN, as applicable) establishing an exemption from, or reduction of, U.S.
federal withholding Tax pursuant to the “interest” article of such tax treaty
and (y) with respect to any other applicable payments under any Loan Document,
IRS Form W-8BEN-E (or W-8BEN, as applicable) establishing an exemption from, or
reduction of, U.S. federal withholding Tax pursuant to the “business profits” or
“other income” article of such tax treaty;

 

(2)     executed originals of IRS Form W-8ECI;

 

(3)     in the case of a Foreign Lender claiming the benefits of the exemption
for portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit H-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a “10
percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B)
of the Code, or a “controlled foreign corporation” described in Section
881(c)(3)(C) of the Code (a “U.S. Tax Compliance Certificate”) and (y) executed
copies of IRS Form W-8BEN-E (or W-8BEN, as applicable); or

 

(4)     to the extent a Foreign Lender is not the beneficial owner, executed
copies of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN-E (or
W-8BEN, as applicable), a U.S. Tax Compliance Certificate substantially in the
form of Exhibit H-2 or Exhibit H-3, IRS Form W-9, and/or other certification
documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership and one or more direct or indirect partners of
such Foreign Lender are claiming the portfolio interest exemption, such Foreign
Lender may provide a U.S. Tax Compliance Certificate substantially in the form
of Exhibit H-4 on behalf of each such direct and indirect partner;

 

(C)     any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower and the Administrative Agent (in such number of copies
as shall be requested by the recipient) on or prior to the date on which such
Foreign Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower or the Administrative
Agent), executed copies (or originals, as required) of any other form prescribed
by applicable Law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable Law to permit the Borrower or
the Administrative Agent to determine the withholding or deduction required to
be made; and

 

 

 
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(D)     if a payment made to a Lender under any Loan Document would be subject
to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower and the Administrative Agent at the time or times
prescribed by law and at such time or times reasonably requested by the Borrower
or the Administrative Agent such documentation prescribed by applicable Law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such
additional documentation reasonably requested by the Borrower or the
Administrative Agent as may be necessary for the Borrower and the Administrative
Agent to comply with their obligations under FATCA and to determine that such
Lender has complied with such Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this
clause (D), “FATCA” shall include any amendments made to FATCA after the date of
this Agreement.

 

(iii)     Each Lender agrees that if any form or certification it previously
delivered pursuant to this Section 3.12 expires or becomes obsolete or
inaccurate in any respect, it shall update such form or certification or
promptly notify the Borrower and the Administrative Agent in writing of its
legal inability to do so.

 

(f)     Treatment of Certain Refunds. Unless required by applicable Laws, at no
time shall the Administrative Agent have any obligation to file for or otherwise
pursue on behalf of a Lender, or have any obligation to pay to any Lender, any
refund of Taxes withheld or deducted from funds paid for the account of such
Lender, as the case may be. If any Recipient determines, in its sole discretion
exercised in good faith, that it has received a refund of any Taxes as to which
it has been indemnified by any Loan Party or with respect to which any Loan
Party has paid additional amounts pursuant to this Section 3.12, it shall pay to
such Loan Party an amount equal to such refund (but only to the extent of
indemnity payments made, or additional amounts paid, by such Loan Party under
this Section 3.12 with respect to the Taxes giving rise to such refund), net of
all out-of-pocket expenses (including Taxes) incurred by such Recipient, as the
case may be, and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that each Loan
Party, upon the request of the Recipient, agrees to repay the amount paid over
to such Loan Party (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) to the Recipient in the event the Recipient is
required to repay such refund to such Governmental Authority. Notwithstanding
anything to the contrary in this subsection, in no event will the applicable
Recipient be required to pay any amount to such Loan Party pursuant to this
subsection the payment of which would place the Recipient in a less favorable
net after-Tax position than such Recipient would have been in if the Tax subject
to indemnification and giving rise to such refund had not been deducted,
withheld or otherwise imposed and the indemnification payments or additional
amounts with respect to such Tax had never been paid. This subsection shall not
be construed to require any Recipient to make available its tax returns (or any
other information relating to its taxes that it deems confidential) to any Loan
Party or any other Person.

 

 

 
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(g)     Survival. Each party’s obligations under this Section 3.12 shall survive
the resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all other Obligations.

 

3.13     Use of Proceeds. The proceeds of the Loans shall be used to fund the
refinancing of existing revolving and term indebtedness payable to the Existing
Lender pursuant to the Existing Credit Agreement, pay fees, commissions, Swap
Termination Value and expenses in connection therewith, to fund Permitted
Acquisitions in accordance with the provisions hereof and for the general
working capital and general corporate purposes of the Borrower and its
Subsidiaries.

 

3.14     Change in Lending Office; Replacement of Lender.

 

(a)     Each Lender agrees that if it makes any demand for payment under Section
3.10 or 3.12, or if any adoption or change of the type described in Section 3.9
shall occur with respect to it, it will use reasonable efforts (consistent with
its internal policy and legal and regulatory restrictions and so long as such
efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office or to assign its rights and
obligations hereunder to another of its offices, branches or affiliates if such
designation or assignment would reduce or obviate the need for the Borrower to
make payments under Section 3.10 or 3.12, or would eliminate or reduce the
effect of any adoption or change described in Section 3.9.

 

(b)     If any Lender requests any payment under Section 3.10 or 3.12, the
Borrower shall have the right to replace such Lender with one or more
replacement lenders, each of which shall be reasonably acceptable to the
Administrative Agent; provided that (i) the Borrower shall repay (or the
replacement lender shall purchase) all Loans and other amounts owing hereunder
to such replaced Lender on or prior to the date of replacement, (ii) until such
time as such replacement shall be consummated, the Borrower shall pay additional
amounts (if any) required pursuant to Section 3.10 or 3.12 for the period prior
to replacement and (iii) any such replacement shall not be deemed to be a waiver
of any rights which the Borrower, the Administrative Agent or any other Lender
shall have against the replaced Lender.

 

3.15     Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan other than on the last day of an Interest
Period applicable thereto (including, without limitation, as a result of an
Event of Default), (b) the conversion of any Eurodollar other than on the last
day of an Interest Period applicable thereto, or (c) the failure to borrow,
convert, continue or prepay any Eurodollar Loan on the date specified in any
notice delivered pursuant hereto, then, in any such event, the Borrower shall
compensate each Lender for the loss, cost and expense attributable to such
event. Such loss, cost or expense to any Lender shall be the amount determined
by such Lender to be the excess, if any, of (i) the amount of interest that
would have accrued on the principal amount of such Loan had such event not
occurred, at the Eurodollar Rate that would have been applicable to such Loan,
for the period from the date of such event to the last day of the then current
Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such Loan)
over (ii) the amount of interest that would accrue on such principal amount for
such period at the interest rate such Lender would bid were it to bid, at the
commencement of such period, for dollar deposits of a comparable amount and
period from other banks in the eurodollar market. A certificate of any Lender
setting forth any amount or amounts that such Lender is entitled to receive
pursuant to this Section 3.15 shall be delivered to the Borrower and shall be
conclusive absent manifest error. The Borrower shall pay such Lender the amount
shown as due on any such certificate within ten (10) days after receipt thereof.
The Lender is authorized (but not obligated) to debit any deposit account of the
Borrower now or hereafter maintained by the Borrower with the Lender to pay any
such amount that is not paid when due.

 

 

 
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3.16     Evidence of Debt.

 

(a)     Each Lender shall maintain in accordance with its usual practice an
account or accounts evidencing indebtedness of the Borrower to such Lender
resulting from each Revolving Credit Loan or Term Loan of such Lender from time
to time, including the amounts of principal and interest payable thereon and
paid to such Lender from time to time under this Agreement.

 

(b)     The Administrative Agent shall maintain the Register pursuant to Section
10.6(b), and a subaccount therein for each Lender, in which shall be recorded
(i) the amount of each Revolving Credit Loan or Term Loan made hereunder, the
Type thereof and each Interest Period applicable thereto, (ii) the amount of any
principal or interest due and payable or to become due and payable from the
Borrower to each Lender hereunder in respect of the Revolving Credit Loans or
Term Loans and (iii) both the amount of any sum received by the Administrative
Agent hereunder from the Borrower in respect of the Revolving Credit Loans or
Term Loans and each Lender’s share thereof.

 

(c)     The entries made in the Register and the accounts of each Lender
maintained pursuant to Section 3.16(a) shall, to the extent permitted by
applicable law, be prima facie evidence of the existence and amounts of the
obligations of the Borrower therein recorded; provided, however, that the
failure of any Lender to maintain such account or the Administrative Agent to
maintain the Register, or any error therein, shall not in any manner affect the
obligation of the Borrower to repay (with applicable interest) the Loans made to
the Borrower by such Lender in accordance with the terms of this Agreement.

 

(d)     The Borrower agrees that it will, upon the request of any Term Lender,
execute and deliver to such Lender a promissory note of the Borrower evidencing
the Term Loans owed by it, substantially in the form attached hereto as Exhibit
A-1 with appropriate insertions as to date and principal amount and indicating
the Term Loan Percentage of such Term Lenders (each, a “Term Note”). The
Borrower agrees that it will, upon the request of any Revolving Lender, execute
and deliver to such Lender a promissory note of the Borrower evidencing the
Revolving Credit Commitment of such Lender, substantially in the form attached
hereto as Exhibit A-2 with appropriate insertions as to date and principal
amount (each, a “Revolving Credit Note”); provided that any Revolving Credit
Note previously delivered to such Lender (or any predecessor thereof) has been
returned to the Borrower and marked cancelled or an affidavit or lost or
destroyed Note (in form reasonably acceptable to the Borrower) is executed and
delivered by such requesting Lender in lieu of such Note.

 

 

 
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ARTICLE IV: REPRESENTATIONS AND WARRANTIES

 

To induce the Lenders to enter into this Agreement and to make the Loans, the
Borrower represents and warrants to the Agent and to each Lender that:

 

4.1     Financial Condition; Accuracy of Information. Except as set forth on
Schedule 4.1 during the period from September 30, 2015 to and including the date
hereof, there has been no sale, transfer or other disposition by the Borrower of
any material part of its business or property and no purchase or other
acquisition of any business or property (including any capital stock of any
other Person) material in relation to the financial condition of the Borrower on
September 30, 2015, other than the sale of inventory in the ordinary course of
business.

 

4.2     No Change. Since September 30, 2015, there has been no development or
event which has had or would reasonably be expected to have a Material Adverse
Effect.

 

4.3     Corporate Existence; Compliance with Law. Each Loan Party and its
Subsidiaries (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its organization, (b) has the power and
authority, and the legal right, to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged, (c) is duly qualified as a foreign entity and in good
standing under the laws of each jurisdiction where its ownership, lease or
operation of property or the conduct of its business requires such
qualification, except to the extent that the failure to be so qualified in any
such jurisdiction could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect, and (d) is in compliance with all Requirements of Law,
except to the extent that the failure to comply therewith would not, in the
aggregate, reasonably be expected to have a Material Adverse Effect.

 

4.4     Corporate Power; Authorization; Enforceable Obligations. Each Loan Party
has the power and authority, and the legal right, to make, deliver and perform
the Loan Documents to which it is a party and to borrow and obtain other
extensions of credit hereunder and has taken all necessary action to authorize
the borrowings and other extensions of credit hereunder on the terms and
conditions of this Agreement and any Notes and to authorize the execution,
delivery and performance of the Loan Documents to which it is a party. No
consent or authorization of, filing with, notice to or other act by or in
respect of, any Governmental Authority or any other Person is required as a
condition precedent to the borrowings or other extensions of credit hereunder or
the execution, delivery, performance, validity or enforceability of the Loan
Documents. This Agreement has been, and each other Loan Document to which it is
a party will be, duly executed and delivered on behalf of each Loan Party that
is a party hereto or thereto. This Agreement constitutes, and each other Loan
Document to which it is a party constitutes, a legal, valid and binding
obligation of each Loan Party that is a party hereto or thereto, enforceable
against such Loan Party in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors’ rights generally, general
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.

 

 

 
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4.5     No Legal Bar. The execution, delivery and performance by the Borrower of
the Loan Documents, the borrowings and other extensions of credit hereunder and
the use of the proceeds thereof will not (a) violate any Requirement of Law or
Contractual Obligation of any Loan Party or of any of its Subsidiaries except
(other than with respect to Security Documents or the organizational and
governing documents of such Loan Party or Subsidiaries), as would not, in the
aggregate, reasonably be expected to result in a Material Adverse Effect, or (b)
result in, or require, the creation or imposition of any Lien on any of its or
their respective properties or revenues pursuant to any such Requirement of Law
or Contractual Obligation (other than those Liens created by the Loan
Documents).

 

4.6     No Material Litigation. Except as set forth on Schedule 4.6, no
litigation, investigation or proceeding of or before any arbitrator or
Governmental Authority is pending or, to the knowledge of the Loan Parties,
threatened by or against any Loan Party or any of its Subsidiaries or against
any of its or their respective properties or revenues (a) with respect to any of
the Loan Documents and the other transactions contemplated hereby or thereby, or
(b) which would reasonably be expected to have a Material Adverse Effect.

 

4.7     No Default. No Loan Party or any of its Subsidiaries is in default under
or with respect to any of its Contractual Obligations in any respect which could
reasonably be expected to have a Material Adverse Effect. No Default or Event of
Default has occurred and is continuing.

 

4.8     Ownership of Property; Liens. Each of the Loan Parties and its
Subsidiaries has good record and marketable title in fee simple to, or a valid
leasehold interest in, all its real property, and good title to, or a valid
leasehold interest in, all its other property, except to the extent that the
failure to have such title would not have a Material Adverse Effect. None of
such property is subject to any Lien except as permitted by Section 7.3.
Borrower is not party to any Applicable USA Contracts except in accordance with
Section 5.1(h). With respect to real property or interests in real property, as
of the Closing Date, the Borrower or its Subsidiaries have (i) fee title to all
of the real property listed on Schedule 4.8 under the heading “Fee Properties”,
and (ii) good and valid title to the leasehold estates in all of the real
property leased by it and listed on Schedule 4.8 under the heading “Leased
Properties”, in each case free and clear of all mortgages, liens, security
interests, easements, covenants, rights-of-way and other similar restrictions of
any nature whatsoever, except (A) Liens permitted pursuant to Section 7.3, (B)
as to leased property, the terms and provisions of the respective lease therefor
and any matters affecting the fee title and any estate superior to the leasehold
estate related thereto, and (C) title or lease defects, or leases or subleases
granted to others, which are not material to the fee properties or the leased
properties, as the case may be, taken as a whole.

 

 

 
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4.9     Intellectual Property. Each Loan Party, and each of its Subsidiaries,
owns, or is licensed to use or otherwise has the right to use, all trademarks,
trade names, copyrights, patents, domain names, trade secrets and other
proprietary information that it uses in the conduct of its business as currently
conducted except for those for which the failure to own or license which would
not reasonably be expected to have a Material Adverse Effect (the “Intellectual
Property”). To the knowledge of each Loan Party, no claim has been asserted and
is pending or is threatened to be asserted by any Person challenging or
questioning the use of any material Intellectual Property or the validity or
enforceability of any such Intellectual Property which would reasonably be
expected to have a Material Adverse Effect, nor does any Loan Party know of any
valid basis for any such claim. The use of such Intellectual Property by each
Loan Party and its Subsidiaries does not infringe on the rights of any Person,
except for such claims and infringements that, in the aggregate, would not
reasonably be expected to have a Material Adverse Effect.

 

4.10     Taxes. Except as disclosed in Schedule 4.10, each Loan Party, and each
of its Subsidiaries, has filed or caused to be filed all material tax returns
which are required to be filed (and each such tax return is true and correct in
all material respects) and has paid all taxes shown to be due and payable on
said returns or on any assessments made against it or any of its property and
all other taxes, fees or other charges imposed on it or any of its property by
any Governmental Authority (other than any the amount or validity of which are
currently being contested in good faith by appropriate proceedings and with
respect to which reserves in conformity with GAAP have been provided on the
books of such Loan Party or its Subsidiaries, as the case may be), and no tax
Lien has been filed, and, to the knowledge of the Loan Parties, no claim is
being asserted, with respect to any such tax, fee or other charge, in each case
other than to the extent that any such failure to act or existence of claim
would not, in the aggregate, reasonably be expected to have a Material Adverse
Effect.

 

4.11     Federal Regulations. No part of the proceeds of any Loans, will be used
for “purchasing” or “carrying” any “margin stock” within the respective meanings
of each of the quoted terms under Regulation U of the Board as now and from time
to time hereafter in effect. If requested by any Lender or the Administrative
Agent, the Borrower will furnish to the Administrative Agent and each Lender a
statement to the foregoing effect in conformity with the requirements of FR Form
G-3 or FR Form U-1 referred to in said Regulation U, as the case may be.

 

4.12     ERISA

 

(a)     No ERISA Event has occurred or is reasonably expected to occur that,
when taken together with all other such ERISA Events for which liability is
reasonably expected to occur, would reasonably be expected to result in a
Material Adverse Effect. The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date of
the most recent financial statements reflecting such amounts, exceed the fair
market value of the assets of such Plan by more than $250,000 and the present
value of all accumulated benefit obligations of all underfunded Plans (based on
the assumptions used for purposes of Statement of Financial Accounting Standards
No. 87) did not, as of the date of the most recent financial statements
reflecting such amounts, exceed the fair market value of the assets of all such
underfunded Plans by more than $250,000.

 

 

 
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(b)     Except as would not reasonably be expected to result in a Material
Adverse Effect, (i) each Foreign Plan has been maintained in compliance with its
terms and with the requirements of any and all applicable laws, statutes, rules,
regulations and orders and has been maintained, where required, in good standing
with applicable regulatory authorities, and (ii) neither the Borrower nor any
Subsidiary have incurred any obligation in connection with the termination of or
withdrawal from any Foreign Plan.

 

4.13     Investment Company Act; Other Regulations. The Borrower is not an
“investment company,” or a company “controlled” by an “investment company,”
within the meaning of the Investment Company Act of 1940, as amended. The
Borrower is not subject to regulation under any Federal or State statute or
regulation (other than Regulation X of the Board) which limits its ability to
incur Indebtedness.

 

4.14     Subsidiaries. Schedule 4.14 sets forth all Subsidiaries (if any) of the
Borrower.

 

4.15     Environmental Matters. Except to the extent that all of the following,
in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect:

 

(a)     The facilities and properties owned, leased or operated by each Loan
Party or any of its Subsidiaries (the “Properties”) do not contain any Hazardous
Materials in amounts or concentrations which (i) constitute a violation of, or
(ii) could reasonably be expected to give rise to liability under, any
Environmental Law.

 

(b)     The Properties and all operations at the Properties are in compliance in
all material respects with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the business operated by any
Loan Party or any of its Subsidiaries (the “Business”) which could materially
interfere with the continued operation of the Properties.

 

(c)     Neither any Loan Party nor any of its Subsidiaries has received any
written notice of violation, alleged violation, non-compliance, liability or
potential liability regarding any Environmental Laws with regard to any of the
Properties or the Business, nor does any Loan Party have knowledge that any such
notice will be received or is being threatened.

 

(d)     No Hazardous Materials have been transported or disposed of from the
Properties in violation of, or in a manner or to a location which could
reasonably be expected to give rise to liability under, any Environmental Law,
nor have any Hazardous Materials been generated, treated, stored or disposed of
at, on or under any of the Properties in violation of, or in a manner that could
reasonably be expected to give rise to liability under, any applicable
Environmental Law.

 

(e)     No judicial proceeding or governmental or administrative action is
pending or, to the knowledge of any Loan Party, threatened, under any
Environmental Law to which any Loan Party or any Subsidiary thereof is or will
be named as a party with respect to the Properties or the Business, nor are
there any decrees, orders or agreements which impose obligations, or other
administrative or judicial requirements outstanding under any Environmental Law
with respect to the Properties or the Business.

 

 

 
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(f)     There has been no release or threat of release of Hazardous Materials
at, under or from the Properties, or arising from or related to the operations
of any Loan Party or any Subsidiary thereof in connection with the Properties or
otherwise in connection with the Business, in violation of or in amounts or in a
manner that could reasonably be expected to give rise to liability under
Environmental Laws.

 

4.16     Solvency. Each Loan Party is, and after giving effect to the incurrence
of all Indebtedness and obligations being incurred in connection herewith will
be, Solvent.

 

4.17     Security Documents. The Security Agreements are effective to create in
favor of the Administrative Agent, for the benefit of the Lenders, a legal,
valid and enforceable security interest in the Collateral described, and as
defined, therein, subject only to Liens (if any) permitted hereunder, and
proceeds thereof.

 

4.18     Insurance. Schedule 4.18 sets forth a true, complete and correct
summary description of all material insurance maintained by each Loan Party.
Such insurance is in full force and effect and all premiums have been duly paid.
Each Loan Party has insurance through insurers it reasonably believes to be of
recognized financial responsibility covering its properties, operations,
personnel and businesses, including business interruption insurance, which
insurance is in amounts and insures against such losses and risks as it
reasonably believes are adequate to protect it and its Subsidiaries and their
respective businesses; and neither the Borrower nor any of its Subsidiaries has
received notice from any insurer or agent of such insurer that capital
improvements or other expenditures are required or necessary to be made in order
to continue such insurance.

 

4.19     OFAC. Neither any Loan Party, nor any Subsidiary of any Loan Party, nor
any Affiliate of any Loan Party, is (a) named on the list of Specially
Designated Nationals or Blocked Persons maintained by the U.S. Department of the
Treasury’s Office of Foreign Assets Control (“OFAC”) available at
http://www.treas.gov/offices/eotffe/ofac/sdn/index.html, or (b)(i) an agency of
the government of a country, (ii) an organization controlled by a country, or
(iii) a Person resident in a country that is subject to a sanctions program
identified on the list maintained by OFAC and available at
http://www.treas.gov/offices/eotffc/ofac/sanctions/index.html, or as otherwise
published from time to time, as such program maybe be applicable to such agency,
organization or Person, and the proceeds from the credit extensions made
pursuant to this Agreement will not be used to fund any operations in, finance
any investments or activities in, or make any payments to, any such country or
Person.

 

ARTICLE V:     CONDITIONS PRECEDENT

 

5.1     Conditions to Closing Date. The Closing Date shall occur on the date of
satisfaction of the following conditions precedent:

 

 

 
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(a)     Loan Documents. The Administrative Agent shall have received (i) this
Agreement (inclusive of all exhibits, and attachments), executed and delivered
by a duly authorized officer of the Borrower, with a counterpart or a conformed
copy for each Lender, (ii) the Security Documents, executed and delivered by a
duly authorized officer of each party thereto, with a counterpart or a conformed
copy for each Lender, and (iii) signed Term Notes and Revolving Credit Notes for
the account of each Lender that shall so request, executed and delivered by a
duly authorized officer of the Borrower and (iv) executed counterparts of all
other Loan Documents.

 

(b)     Existing Credit Agreement and Existing Loan Documents. The Existing
Credit Agreement and the Existing Loan Documents shall have been (i) assigned to
the Agent, refinanced, amended and restated hereby, (ii) all indebtedness,
liabilities and obligations outstanding thereunder shall have been refinanced
with the proceeds of the Loans and (iii) the Existing Credit Agreement shall
have been terminated, superceded, restated and of no further force or effect
after the Closing Date. The administrative agent and the collateral agent under
the Existing Credit Agreement shall have assigned all of its right, title and
interest to or in the Existing Loan Documents to Agent, and shall have resigned
as administrative agent and collateral agent under the Existing Credit
Agreement.

 

(c)     Closing Date Certificate. The Administrative Agent shall have received,
with a copy for each Lender, a certificate of each of the Borrower and the other
Loan Parties, dated the Closing Date, substantially in the form attached hereto
as Exhibit E, with appropriate insertions and attachments satisfactory in form
and substance to the Administrative Agent, executed by the President of the
Borrower or the relevant Loan Party, as applicable.

 

(d)     Corporate Proceedings of the Borrower. The Administrative Agent shall
have received, with a counterpart for each Lender, a copy of the resolutions, in
form and substance satisfactory to the Administrative Agent, of the Board of
Directors of the Borrower authorizing (i) the execution, delivery and
performance of this Agreement and (ii) the borrowings contemplated hereunder,
certified by the Secretary or an Assistant Secretary of the Borrower as of the
Closing Date, which certificate shall be in form and substance satisfactory to
the Administrative Agent and shall state that the resolutions thereby certified
have not been amended, modified, revoked or rescinded.

 

(e)     Officers’ Certificate of the Borrower. The Administrative Agent shall
have received, with a counterpart for each Lender, a certificate of the Borrower
dated the Closing Date, as to the incumbency and signature of the officers of
the Borrower executing any Loan Document satisfactory in form and substance to
the Administrative Agent, executed by the President or any Vice President and
the Secretary or any Assistant Secretary of the Borrower.

 

(f)     Corporate Proceedings of Subsidiaries. The Administrative Agent shall
have received, with a counterpart for each Lender, a copy of the resolutions, in
form and substance satisfactory to the Administrative Agent, of the Board of
Directors of each other Subsidiary of the Borrower which is a party to a Loan
Document authorizing the execution, delivery and performance of the Loan
Documents to which it is a party, certified by the Secretary or an Assistant
Secretary of each such Subsidiary as of the Closing Date, which certificate
shall be in form and substance satisfactory to the Administrative Agent and
shall state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded.

 

 

 
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(g)     Subsidiary Incumbency Certificates. The Administrative Agent shall have
received, with a counterpart for each Lender, a certificate of each other
Subsidiary of the Borrower which is a party to a Loan Document, dated the
Closing Date, as to the incumbency and signature of the officers of such
Subsidiary, satisfactory in form and substance to the Administrative Agent,
executed by the President or any Vice President and the Secretary or any
Assistant Secretary of each such Subsidiary.

 

(h)     USA Agreements.     As and when the Borrower enters into Applicable USA
Contracts, the Administrative Agent and the United States of America shall have
entered into USA Agreements. As of the date hereof, the Borrower is not party to
any Applicable USA Contracts, except the Designated USA Contracts. With respect
to the Designated USA Contracts, Borrower shall comply with the provisions of
this subsection within ninety (90) days of the date hereof. Promptly upon
Borrower’s reasonable request, provided there is no Default under the Loan
Documents, the Agent shall enter into USA Agreements with respect to such
Applicable USA Contracts.

 

(i)     Insurance Certificates. The Bank shall have received insurance
certificates and paid receipts (i) naming the Agent on behalf of the Lenders as
loss payee, evidencing personal property coverage (for inventory and equipment)
on ACORD Form 28 and general liability coverage on ACORD Form 25, and (ii) such
other certificates necessary to show compliance with Section 6.5.

 

(j)     Interest in Term Loan. The conditions in Section 2.5 shall have been
satisfied.

 

(k)     Corporate Documents. The Administrative Agent shall have received, with
a counterpart for each Lender, true and complete copies of the certificate of
incorporation and by-laws of each Loan Party, certified as of the Closing Date
as complete and correct copies thereof by the Secretary or an Assistant
Secretary of such Loan Party.

 

(l)     Fees. The Arranger, the Agent and the Lenders shall have received all
invoiced fees, costs, expenses and compensation required to be paid on the
Closing Date (including fees payable under the Agent Fee Letter, any fee letter
with the Lenders and the reasonable fees, disbursements and other charges of
legal counsel to the Arranger, the Agent and the Lenders and expenses of
appraisers, consultants and other advisors to the Arranger, the Agent and the
Lenders and who have been approved by the Borrower).

 

(m)     Legal Opinions. The Administrative Agent shall have received, with a
counterpart for each Lender, the executed legal opinion of Graubard Miller,
counsel to the Borrower and the other Loan Parties, substantially in the form
attached hereto as Exhibit E.

 

 

 
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(n)     Actions to Perfect Liens. The Administrative Agent shall have received
evidence in form and substance satisfactory to it that all filings, recordings,
registrations and other actions, including, without limitation, the filing of
duly executed financing statements on form UCC-1 or UCC-3 necessary or, in the
opinion of the Administrative Agent, desirable to perfect or continue the Liens
created by the Security Documents shall have been completed or shall continue to
be in full force and effect.

 

(o)     Lien Searches. The Administrative Agent shall have received the results
of a recent search by a Person satisfactory to the Administrative Agent of the
Uniform Commercial Code filings which may have been filed with respect to
personal property of each Loan Party and each patent, trademark or copyright
recorded with the United States Patent and Trademark Office or the United States
Copyright Office, as applicable, and such search shall reveal no material liens
on any of the assets of such Loan Party except for liens created by the Security
Documents or Liens permitted by the Loan Documents.

 

(p)     Consents, Licenses and Approvals. All governmental and material third
party approvals necessary in connection with the execution, delivery and
performance of the Loan Documents shall have been obtained and be in full force
and effect or shall continue to be in full force and effect.

 

(q)     Litigation. There shall be no litigation or administrative proceeding or
proposed or pending regulatory changes in law or regulations applicable to the
Borrower or its Subsidiaries, that would reasonably be expected to have a
Material Adverse Effect or a material adverse effect on the ability of the
parties to consummate the execution, delivery and performance of the Loan
Documents and the Borrowings hereunder.

 

(r)     Indebtedness. Immediately after giving effect to the Extensions of
Credit on the Closing Date, the Borrower and its Subsidiaries shall not have
outstanding Indebtedness for borrowed money or preferred stock other than (w)
Indebtedness under the Loan Documents, (x) Indebtedness permitted hereunder, (y)
Indebtedness as set forth on Schedule 7.2 and (z) other Indebtedness for
borrowed money not enumerated above, not to exceed $500,000.

 

(s)     Documentation: Projections. The Lenders have received such other legal
opinions, corporate documents and other instruments and/or certificates as they
may reasonably request, including, but not limited to, projections of Borrower’s
balance sheet, income statement, and statement of cash flow, (consistent with
the proposed structure and advance rates), through the fiscal year ended
December 31, 2016, in a form acceptable to the Administrative Agent.

 

(t)     Material Adverse Change. Since September 30, 2015, there has been no
development or event which has had or would reasonably be expected to have a
Material Adverse Effect.

 

(u)     Landlord Waiver and Consent. The Administrative Agent shall have
received a Landlord Waiver and Consent from the landlord with respect to the
premises at 91 Heartland Boulevard, Edgewood, New York, reasonably satisfactory
in form and substance to Administrative Agent and its counsel.

 

 

 
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(v)     Execution by Lenders. This Agreement shall have been executed and
delivered by each Lender hereunder.

 

5.2     Conditions to Each Extension of Credit. The agreement of each Lender to
make any Loan requested to be made by it on any date (including, without
limitation, the Closing Date), is subject to the receipt of a Notice of
Transaction for a Term Loan or a Revolving Credit Loan, as applicable, and the
satisfaction of the following conditions precedent as of the date such Loan is
requested to be made:

 

(a)     Representations and Warranties. Each of the representations and
warranties made by each of the Loan Parties in or pursuant to the Loan Documents
shall be true and correct in all material respects on and as of such date as if
made on and as of such date, other than any such representations and warranties
that, by their terms, refer to a specific date other than such date, in which
case as of such specific date.

 

(b)     No Default. No Default or Event of Default shall have occurred and be
continuing on such date or immediately after giving effect to the Extension of
Credit requested to be made on such date.

 

(c)     Conditions Precedent. The conditions set forth in Section 5.1 shall
continue to be satisfied.

 

Each request by the Borrower for an Extension of Credit to be made to the
Borrower hereunder shall constitute a representation and warranty by the
Borrower as of the date of such Loan that the conditions contained in this
Section 5.2 have been satisfied.

 

ARTICLE VI: AFFIRMATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Commitments (or any of them)
remain in effect, any Loan remains outstanding and unpaid or any other amount is
owing to any Lender or the Administrative Agent hereunder or under any other
Loan Document, the Borrower shall and shall cause each of its Subsidiaries to:

 

6.1     Financial Statements. Furnish to each Lender:

 

(a)     As soon as available, but in any event, within ninety (90) days after
the end of each fiscal year, or, if earlier, within fifteen (15) days after the
date (without extension) required to be filed with the SEC, audited consolidated
financial statements of Borrower and its Subsidiaries as of the end of such
year, fairly presenting Borrower's and its Subsidiaries' financial position,
which statements shall consist of a balance sheet and related statements of
income, retained earnings, and cash flow covering the period of Borrower's
immediately preceding fiscal year, and which shall be prepared by Borrower in
accordance with GAAP consistently applied and audited by independent certified
public accountants (the “Auditors”) reasonably satisfactory to the
Administrative Agent; such statements shall not be subject to any “going
concern” or like qualification or exception or any qualification or exception as
to the scope of such audit. Administrative Agent and the Lenders hereby accept
Cohn Reznick LLP, CPAs as the Borrower’s Auditors. At the same time, Borrower
shall deliver to each Lender (i) internally prepared consolidating financial
statements of Borrower and its Subsidiaries, and (ii) a covenant compliance
certificate certifying that there are no defaults to the Loan Documents in the
form of Exhibit F attached hereto and made a part hereof and otherwise in form
and substance reasonably satisfactory to the Administrative Agent, executed by a
Financial Officer of Borrower. All such financial statements and other documents
delivered to each Lender are to be certified as accurate by a Financial Officer
of Borrower.

 

 

 
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(b)     Within forty-five (45) days of each first, second and third fiscal
quarter of each fiscal year, or if earlier, within five (5) days after the date
(without extension) required to be filed with the SEC, consolidated financial
statements of Borrower and its Subsidiaries as of the end of such period, fairly
presenting Borrower's and its Subsidiaries' financial position, and internally
prepared consolidating financial statements of Borrower and its Subsidiaries. At
the same time, the Borrower shall deliver to the each Lender a covenant
compliance certificate certifying that there are no defaults to the Loan
Documents in the form of Exhibit F attached hereto and made a part hereof and
otherwise in form and substance reasonably satisfactory to the Administrative
Agent, executed by a Financial Officer of Borrower. All such reports shall be in
such detail as the Administrative Agent shall request and shall be prepared in
accordance with GAAP consistently applied and shall be signed and certified to
be correct by the Financial Officer of Borrower.

 

(c)     Within thirty (30) days after the end of each month, a schedule of
projects in which the Borrower is then involved (each a “Work-in-Progress
Schedule”), in form and substance satisfactory to the Administrative Agent and
including, without limitation: (y) an identification of each project by name or
project number, and (z) the contract price for each such project (including any
change orders), the costs incurred to date, gross profit to date, contract
billings to date, costs and estimated earnings in excess of billings and
billings in excess of costs and estimated earnings, and costs to complete. The
Work-in-Progress Schedule will include contract revenues earned and contract
costs for the period reported. Each such Work-in-Progress Schedule shall be
certified by the chief financial executive officer of the Borrower as being
true, correct and complete to the best of such officer’s knowledge.

 

(d)     With each corresponding Work-in-Progress Schedule as specified in
Section (c) above, an accounts receivable aging schedule, an accounts payable
aging schedule and a cash flow schedule, each in form and detail reasonably
acceptable to Administrative Agent.

 

(e)     As soon as available and in any event within sixty (60) days after the
end of each fiscal year, a pro forma budget for the current and succeeding
fiscal year, containing an income statement, balance sheet and statement of cash
flow.

 

 

 
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(f)     Promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed with the
SEC, or any Governmental Authority succeeding to any or all functions of said
Commission, or with any national securities exchange, or distributed by the
Borrower to its shareholders generally, as the case may be.

 

(g)     Promptly following any request therefor, such other information
regarding the results of operations, business affairs and financial condition of
the Borrower or any Subsidiary as the Administrative Agent (or any Lender
through the Administrative Agent) may reasonably request.

 

All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein and with prior
periods (except that interim statements may exclude detailed footnote disclosure
in accordance with standard practice).

 

6.2     Certificates; Other Information. Furnish to each Lender:

 

(a)     concurrently with the delivery of the financial statements referred to
in Sections 6.1(a) and 6.1(b), a certificate of a Responsible Officer of the
Borrower stating that, to the best of such officer’s knowledge, each Loan Party
during such period has observed or performed all of its covenants and other
agreements, and satisfied every condition, contained in this Agreement and the
other Loan Documents to be observed, performed or satisfied by it, and that such
officer has obtained no knowledge of any Default or Event of Default except as
specified in such certificate; and in the case of financial statements referred
to in Sections 6.1(a) and 6.1(b), including calculations and information
demonstrating in reasonable detail compliance with the requirements of Section
7.1; and

 

(b)     promptly, such additional financial and other information as any Lender
may from time to time reasonably request.

 

6.3     Payment of Obligations. Pay, discharge or otherwise satisfy at or before
maturity or before they become delinquent, as the case may be, all its
obligations of whatever nature (including taxes), except where the failure to
pay, discharge or otherwise satisfy such obligations would not have a Material
Adverse Effect and the amount or validity thereof is currently being contested
in good faith by appropriate proceedings and reserves in conformity with GAAP
with respect thereto have been provided on the books of the Borrower or its
Subsidiaries, as the case may be.

 

6.4     Maintenance of Existence. Preserve, renew and keep in full force and
effect its corporate existence and take all reasonable action to maintain all
rights, privileges and franchises necessary or desirable in the normal conduct
of its business except as otherwise permitted pursuant to Section 7.5; and
comply with all Contractual Obligations and Requirements of Law except to the
extent that failure to comply therewith would not, in the aggregate, be
reasonably expected to have a Material Adverse Effect.

 

 

 
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6.5     Maintenance of Property; Insurance. Keep all property material to the
conduct of the business of the Borrower and its Subsidiaries, taken as a whole,
in good working order and condition; maintain with financially sound and
reputable insurance companies, having a general policy rating of A- or better
and a financial class of IX or better by A.M. Best Company, Inc. (or, if a
rating of A.M. Best Company Inc. is no longer available, a similar rating from a
similar or successor service), such insurance to cover all of its property in at
least such amounts and against at least such risks (but including in any event
public liability, product liability and business interruption) as are usually
insured against in the same general area by companies engaged in the same or a
similar business; and furnish to each Lender, upon written request, full
information as to the insurance carried.

 

6.6     Inspection of Property; Books and Records; Discussions. Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities; and, following
reasonable written notice, permit representatives of any Lender or their agents
to visit and inspect any of its properties and examine and make abstracts from
any of its books and records during normal business hours (a “Field Audit”) at
the expense of the Borrower, and as often as may reasonably be desired and to
discuss the business, operations, properties and financial and other condition
of the Borrower and its Subsidiaries with officers of the Borrower and its
Subsidiaries and, in the presence of an officer of the Borrower, with its
employees and independent certified public accountants. Prior to an Event of
Default such Field Audits shall be limited (in aggregate for all Lenders) to
once in each twelve (12) month period.

 

6.7     Notices. Promptly give notice to the Administrative Agent (who shall
promptly notify each Lender) of:

 

(a)     the occurrence of any Default or Event of Default;

 

(b)     any (i) default or event of default under any Contractual Obligation of
the Borrower or any of its Subsidiaries or (ii) litigation, investigation or
proceeding which may exist at any time between the Borrower or any of its
Subsidiaries and any Governmental Authority, which in either case, if not cured
or if adversely determined, as the case may be, would reasonably be expected to
have a Material Adverse Effect;

 

(c)     any litigation or proceeding (including without limitation any notice of
violation, alleged violation, liability or potential liability under any
Environmental Law) that is filed or commenced (in each case after the Closing
Date) affecting the Borrower or any of its Subsidiaries in which the amount
claimed by the plaintiff is $500,000 or more and not covered by insurance;

 

(d)     any ERISA Event, that alone or together with any other ERISA Events that
have occurred, would reasonably be expected to result in a liability of the
Borrower and its Subsidiaries in an amount exceeding $250,000 (as soon as
possible and in any event within 30 days after any Loan Party knows or has
reason to know thereof); and

 

 

 
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(e)     any development or event which has had or would reasonably be expected
to have a Material Adverse Effect.

 

Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer of the Borrower setting forth details of the occurrence
referred to therein and stating what action the Borrower proposes to take with
respect thereto.

 

6.8     Environmental Laws.

 

(a)     Comply with, and ensure compliance by all tenants and subtenants, if
any, with, all applicable Environmental Laws and obtain and comply in all
respects with and maintain, and ensure that all tenants and subtenants obtain
and comply in all respects with and maintain, any and all licenses, approvals,
notifications, registrations or permits required by applicable Environmental
Laws, except to the extent that any failures could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect or to result in the
payment of an amount of more than $250,000.

 

(b)     Conduct and complete all investigations, studies, sampling and testing,
and all remedial, removal and other actions required under Environmental Laws
and promptly comply in all material respects with all lawful orders and
directives of all Governmental Authorities regarding Environmental Laws except
to the extent that the same are being contested in good faith by appropriate
proceedings and the pendency of such proceedings could not be reasonably
expected to have a Material Adverse Effect.

 

6.9     Additional Subsidiaries; Additional Collateral.

 

(a)     With respect to any Domestic Subsidiary created or acquired after the
Closing Date by the Borrower, promptly cause such Subsidiary to execute a
Guaranty Agreement and Security Agreement, securing the Obligations as described
in the Guaranty Agreement and Security Agreement and covering the types of
assets covered by the Guaranty Agreement and Security Agreement, take all
required actions to perfect the security interests created by the Guaranty
Agreement and Security Agreement in the assets of such Subsidiary and if
requested by the Administrative Agent, deliver to the Administrative Agent legal
opinions relating to the preceding matters, which opinions shall be in form and
substance, and from counsel, reasonably satisfactory to the Administrative
Agent.

 

(b)     With respect to each direct Foreign Subsidiary of the Borrower or of any
Domestic Subsidiary acquired or formed after the Closing Date or a Foreign
Subsidiary that otherwise becomes a direct Foreign Subsidiary after the Closing
Date, promptly after the acquisition or formation thereof or such other Foreign
Subsidiary becoming a direct Foreign Subsidiary, execute and deliver and cause
each such Foreign Subsidiary to execute and deliver to the Administrative Agent,
in form and substance reasonably satisfactory to the Administrative Agent, such
documents and instruments (including, without limitation, pledge agreements) and
take such action (including, without limitation, the delivery of stock
certificates and instruments) as the Administrative Agent may reasonably request
in order to grant to the Administrative Agent, for the ratable benefit of the
Lenders, as collateral security for the Obligations, a first priority perfected
security interest in 65% of the voting Capital Stock and 100% of the non-voting
Capital Stock of, or equivalent ownership interests in, such direct Foreign
Subsidiary, along with any warrants, options, or other rights to acquire the
same, in all cases to the extent legally permissible and practicable and deliver
to the Administrative Agent such legal opinions as it shall reasonably request
with respect thereto. For purposes of this Section 6.9(b), “direct” means
directly held by the Borrower or any Domestic Subsidiary.

 

 

 
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(c)     If requested by the Administrative Agent, grant in favor of the
Administrative Agent, for the benefit of the Lenders, Liens on any other assets
other than real property (owned or leased) hereafter acquired by the Borrower or
any Domestic Subsidiary and on previously encumbered assets which become
unencumbered, to the extent such Liens are then permissible under applicable law
and pursuant to any agreements to which the Borrower or its Subsidiaries are a
party, pursuant to documentation in form and substance reasonably satisfactory
to the Administrative Agent.

 

6.10     Maintain Accounts. Maintain its operating account with Administrative
Agent.

 

ARTICLE VII:     NEGATIVE COVENANTS

 

The Borrower hereby agrees that, so long as the Commitments (or any of them)
remain in effect, any Loan remains outstanding and unpaid or any other amount is
due and payable to any Lender or the Administrative Agent hereunder or under any
other Loan Document, the Borrower shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly:

 

7.1     Financial Condition Covenants.

 

(a)     Minimum Debt Service Coverage Ratio. Permit the Debt Service Coverage
Ratio of the Borrower at the end of each fiscal quarter for the trailing four
quarter period then ended to be less than 1.50 to 1.0. “Debt Service Coverage
Ratio” shall mean (i) the sum of EBITDA, minus Restricted Payments minus
unfinanced Capital Expenditures, divided by (ii) the sum of scheduled principal
and Financing Lease payments plus Interest Expense, plus the current portion of
Seller Compensation; in each case as determined in accordance with GAAP
consistently applied.

 

(b)     Maximum Leverage Ratio. Permit the Leverage Ratio of the Borrower at the
end of each fiscal quarter for the trailing four quarter period then ended to be
more than 3.0 to 1.0. “Leverage Ratio” shall mean (i) Funded Debt, divided by
(ii) EBITDA.

 

(c)     Minimum Net Income. Permit, as of the end of each fiscal quarter, the
amount of the Borrower’s net income after taxes to be less than $1.

 

7.2     Limitation on Indebtedness. Create, incur, assume or suffer to exist any
Indebtedness, except:

 

 

 
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(a)     Indebtedness of the Borrower or any Subsidiary under this Agreement or
any other Loan Document;

 

(b)     existing Indebtedness of the Borrower and its Subsidiaries listed on
Schedule 7.2 and any refinancing of same provided that any refinancing of
unsubordinated debt to non-Affiliates shall be in compliance with the Refinance
Conditions in respect thereof. The following constitute such “Refinance
Conditions”: (a) it is in an aggregate principal amount that does not exceed the
principal amount of the debt being extended, renewed or refinanced; (b) it is
subordinated to the Obligations at least to the same extent as the debt being
extended, renewed or refinanced; (c) the representations, covenants and defaults
applicable to it are no less favorable to Borrower than those applicable to the
debt being extended, renewed or refinanced; (d) no additional Lien is granted to
secure it; (e) no additional Person is obligated on such debt; and (f) upon
giving effect to it, no Default or Event of Default exists.

 

(c)     Indebtedness of the Borrower under Swap Contracts entered into solely to
hedge interest rate exposure and not for speculative purposes;

 

(d)     Indebtedness of the Borrower or any Subsidiary (other than Indebtedness
incurred pursuant to the Term Loans or Revolving Credit Loans hereunder)
incurred to finance the acquisition, construction or improvement of any fixed or
capital assets, including obligations under Financing Leases and any
Indebtedness assumed in connection with the acquisition of any such assets or
secured by a Lien on any such assets prior to the acquisition thereof which Lien
was not created in contemplation of such acquisition and on any extensions,
renewals and replacements of any such Indebtedness that do not increase the
outstanding principal amount thereof; provided that (A) such Indebtedness is
incurred prior to or within 120 days after such acquisition or the completion of
such construction or improvement and (B) the aggregate principal amount of
Indebtedness permitted by this paragraph (d) shall not exceed $250,000 per
fiscal year;

 

(e)     the Indebtedness of (i) any Subsidiary to the Borrower or any other
Subsidiary arising after the date hereof or (ii) Borrower to any Subsidiary; and

 

(f)     Subordinated Debt listed on Schedule 7.2 or otherwise permitted in
writing by the Agent and the Required Lenders.

 

(g)     Indebtedness or Obligations under any Cash Management Agreement and
under any Secured Swap Contract with respect to the Term Loan.

 

7.3     Limitation on Liens. Create, incur, assume or suffer to exist any Lien
upon any of its property, assets or revenues, whether now owned or hereafter
acquired, except for:

 

(a)     Liens for taxes, assessments or other governmental charges or levies not
yet due or which are being contested in good faith by appropriate proceedings,
provided that adequate reserves with respect thereto are maintained on the books
of such Person in conformity with GAAP (or, in the case of Foreign Subsidiaries,
generally accepted accounting principles in effect from time to time in their
respective jurisdictions of incorporation);

 

 

 
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(b)     carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or
other like Liens arising in the ordinary course of business which are not
overdue for a period of more than 60 days or which are being contested in good
faith by appropriate proceedings;

 

(c)     pledges or deposits in connection with workers’ compensation,
unemployment insurance and other social security legislation;

 

(d)     deposits to secure the performance of bids, trade contracts (other than
for borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;

 

(e)     easements, zoning restrictions, rights-of-way, restrictions and other
similar encumbrances incurred in the ordinary course of business which do not
secure any monetary obligations and do not in any case materially detract from
the value of the property subject thereto or materially interfere with the
ordinary conduct of the business of such Person;

 

(f)     Liens (i) existing as of the Closing Date and listed on Schedule 7.3 and
extensions, renewals and replacements thereof that do not increase the
outstanding principal amount thereof, and (ii) previously identified in writing
to the Administrative Agent, arrangements for the release of which satisfactory
to the Administrative Agent have been made;

 

(g)     Liens securing Indebtedness of the Borrower or any Subsidiaries
permitted by Section 7.2(d) incurred to finance the acquisition of fixed or
capital assets (whether pursuant to a loan, a Financing Lease or otherwise),
provided that (i) such Liens shall be created substantially simultaneously with
the acquisition of such fixed or capital assets, (ii) such Liens do not at any
time encumber any property other than the property financed by such
Indebtedness, (iii) the amount of Indebtedness secured thereby is not increased
and (iv) the principal amount of Indebtedness secured by any such Lien shall at
no time exceed the original purchase price of such property at the time it was
acquired;

 

(h)     Liens arising from (i) operating leases and the information only UCC
financing statement filings in respect thereof and (ii) equipment or other goods
which are not owned by Borrower or any Subsidiary located on the premises of
Borrower or such Subsidiary (but not in connection with, or as part of, the
financing thereof), whether pursuant to consignment arrangements or otherwise,
from time to time in the ordinary course of business and consistent with current
practices of Borrower or such Subsidiary and the information only UCC financing
statement filings in respect thereof;

 

(i)     Liens or rights of setoff against credit balances of Borrower or its
Subsidiaries with credit card issuers or credit card processors of amounts owing
by such credit card issuers or credit card processors to Borrower or its
Subsidiaries in the ordinary course of business, but not liens on or rights of
setoff against any other property or assets of Borrower or its Subsidiaries,
pursuant to the credit card agreements (as in effect on the date hereof) to
secure the obligations of Borrower or its Subsidiaries to the credit card
issuers or credit card processors as result of fees and chargebacks;

 

 

 
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(j)     Statutory or common law liens or rights of setoff of depository banks
with respect to funds of Borrowers or Guarantors at such banks to secure fees
and charges in connection with returned items or the standard fees and charges
of such banks in connection with the deposit accounts maintained by Borrowers
and Guarantors at such banks (but not any other Indebtedness or obligations);

 

(k)     Judgments and other similar liens arising in connection with court
proceedings that do not constitute an Event of Default; provided, that (i) such
liens are being contested in good faith and by appropriate proceedings
diligently pursued, (ii) adequate reserves or other appropriate provision, if
any, as are required by GAAP have been made therefor, and (iii) a stay of
enforcement of any such liens is in effect;

 

(l)     Liens in favor of the United States of America and described in any USA
Agreement with the Agent;

 

(m)     Liens upon the Sold Receivables; in connection with the sale described
in Section 7.6(d) below; and

 

(n)     Liens created pursuant to the Security Documents.

 

7.4     Limitation on Guaranty Obligations. Create, incur, assume or suffer to
exist any Guaranty Obligation except:

 

(a)     Guaranty Obligations in existence on the date hereof and listed on
Schedule 7.4; and

 

(b)     guarantees made in the ordinary course of its business by the Borrower
of obligations of any of its Domestic Subsidiaries, or by any Domestic
Subsidiary of the obligations of the Borrower or any other Domestic Subsidiaries
which obligations are otherwise permitted under this Agreement.

 

7.5     Limitation on Fundamental Changes. Enter into any merger, consolidation
or amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or convey, sell, lease, assign, transfer or
otherwise dispose of, all or substantially all of its property, business or
assets, except:

 

(a)     any Subsidiary of the Borrower may be merged or consolidated with or
into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any one or more wholly owned Subsidiaries
of the Borrower (provided that if a Domestic Subsidiary is a party to such
transaction, such Domestic Subsidiary shall be the continuing or surviving
corporation);

 

 

 
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(b)     any wholly owned Subsidiary may sell, lease, transfer or otherwise
dispose of any or all of its assets (upon voluntary liquidation or otherwise) to
the Borrower or any other wholly owned Domestic Subsidiary of the Borrower; and

 

(c)     Permitted Acquisitions.

 

7.6     Limitation on Sale of Assets. Convey, sell, lease, assign, transfer or
otherwise dispose of any of its property, business or assets (including, without
limitation, receivables and leasehold interests), whether now owned or hereafter
acquired, or, in the case of any Subsidiary, issue or sell any shares of such
Subsidiary’s Capital Stock to any Person other than the Borrower or any wholly
owned Domestic Subsidiary, except:

 

(a)     the sale or other disposition of obsolete or worn out property in the
ordinary course of business or property no longer used or useful in the business
of Borrower or any Subsidiary;

 

(b)     the sale of inventory in the ordinary course of business;

 

(c)     as permitted by Section 7.5(b); and

 

(d)     the sale of Sold Receivables to Citibank, N.A.

 

7.7     Limitation on Dividends and Other Restricted Payments. Declare or pay
any Dividend (other than Dividends payable solely in its common stock) on, or
make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any shares of any class of Capital Stock of the Borrower or any
Subsidiary or any warrants or options to purchase any such Capital Stock,
whether now or hereafter outstanding, or make any other distribution in respect
thereof, either directly or indirectly, whether in cash or property or in
obligations of the Borrower or any Subsidiary thereof (such Dividends,
declarations, payments, setting apart, purchases, redemptions, defeasances,
retirements, acquisitions and distributions being herein called, collectively,
“Restricted Payments”) except (a) any Subsidiary may pay Dividends to the
Borrower or any other Subsidiary and (b) the Borrower or any Subsidiary may make
Restricted Payments pursuant to and in accordance with customary equity
incentive plans or other customary benefit plans of the Borrower and its
Subsidiaries.

 

7.8     Limitation on Capital Expenditures. Make any Capital Expenditure except
for Capital Expenditures by the Borrower and its Subsidiaries in the ordinary
course of business not exceeding $1,500,000.00 in the aggregate during any
fiscal year of the Borrower.

 

7.9     Limitation on Investments, Loans and Advances. Make any advance, loan,
extension of credit or capital contribution to, or purchase any stock, bonds,
notes, debentures or other securities of or any assets constituting a business
unit of, or make any other investment in, any Person, except:

 

(a)     extensions of trade credit in the ordinary course of business;

 

 

 
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(b)     investments in Cash Equivalents;

 

(c)     loans and advances to employees of the Borrower or its Subsidiaries for
travel, entertainment and relocation expenses in the ordinary course of business
in an aggregate amount for the Borrower and its Subsidiaries not to exceed
$250,000 at any one time outstanding;

 

(d)     investments by the Borrower or its Subsidiaries in any wholly owned
Subsidiary of the Borrower which has complied with the conditions set forth in
Section 6.9(a) or any wholly owned Foreign Subsidiary which has complied with
the conditions set forth in Section 6.9(b);

 

(e)     investments by the Borrower and its Subsidiaries existing on the Closing
Date and set forth on Schedule 7.9 (e); or

 

(f)     Permitted Acquisitions.

 

7.10     Limitation on Transactions with Affiliates. Except as otherwise
specifically set forth in this Agreement, directly or indirectly purchase,
acquire or lease any property from, or sell, transfer or lease any property to,
or enter into any transaction, with any Affiliate except in the ordinary course
of business and at prices and on terms not less favorable to it than those which
would have been obtained in an arm’s-length transaction with a non-affiliated
third party.

 

7.11     Intentionally Omitted.

 

7.12     Limitation on Negative Pledge Clauses. Enter into with any Person any
agreement, other than this Agreement and the other Loan Documents or Financing
Leases permitted by this Agreement (in which cases, any prohibition or
limitation shall only be effective against the assets financed thereby), which
prohibits or limits the ability of the Borrower or any of its Subsidiaries to
create, incur, assume or suffer to exist any Lien upon any of its property,
assets or revenues, whether now owned or hereafter acquired; provided that the
foregoing shall not apply to (i) restrictions and conditions imposed by law,
(ii) customary restrictions and conditions contained in agreements relating to
the sale of a Subsidiary permitted hereunder pending such sale, provided such
restrictions or conditions apply only to the Subsidiary that is to be sold,
(iii) restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted hereunder if such restrictions or conditions apply only
to the property or assets securing such Indebtedness and (iv) customary
provisions in leases and other contracts restricting the assignment thereof.

 

7.13     Limitation on Lines of Business. Enter into or engage in any material
lines of business, either directly or through any Subsidiary, substantially
different from Borrower’s Line of Business or any business incidental thereto.

 

7.14     Swap Contracts. Enter into any Swap Contract, except (a) any Secured
Swap Contract in connection with the Term Loan (if applicable), (b) Swap
Contracts entered into to hedge or mitigate risks to which the Borrower or any
Subsidiary has actual exposure (other than those in respect of Capital Stock of
the Borrower or any of its Subsidiaries) and (c) Swap Contract entered into in
order to effectively cap, collar or exchange interest rates (from fixed to
floating rates, from one floating rate to another floating rate or otherwise)
with respect to any interest-bearing liability or investment of the Borrower or
any Subsidiary.

 

 

 
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7.15     ERISA. (a) Terminate any Plan so as to result in any material liability
to the Pension Benefit Guaranty Corporation established pursuant to Subtitle A
of Title IV of ERISA (the “PBGC”), (b) engage in or permit any person to engage
in any “prohibited transaction” (as defined in Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1954, as amended) involving any Plan which
would subject the Borrower to any material tax, penalty or other liability, (c)
incur or suffer to exist any material “accumulated funding deficiency” (as
defined in Section 302 of ERISA), whether or not waived, involving any Plan, or
(d) allow or suffer to exist any event or condition, which presents a material
risk of incurring a material liability to the PBGC by reason of termination of
any Plan.

 

7.16     Accounting Changes. Make or permit any Subsidiary to make any change in
its accounting treatment or financial reporting practices except as required or
permitted by GAAP in effect from time to time.

 

7.17     Change of Control. Without the prior written consent of the
Administrative Agent, suffer or permit a Change of Control Transaction, as
hereinafter defined. “Change of Control Transaction” means the occurrence after
the date hereof of any of the following: (i) an acquisition after the date
hereof by an individual or legal entity or “group” (as described in Rule
13d-5(b)(1) promulgated under the Exchange Act) of effective control (whether
through legal or beneficial ownership of capital stock of the Borrower, by
contract or otherwise) of an excess of 49.99% of the voting securities of the
Borrower, or (ii) the Borrower merges into or consolidates with any other
Person, or any Person merges into or consolidates with the Borrower and, after
giving effect to such transaction, the stockholders of the Borrower immediately
prior to such transaction own less than a majority of the aggregate voting power
of the Borrower or the successor entity of such transaction, or (iii) the
Borrower sells or transfers all or substantially all of its assets to another
Person and the stockholders of the Borrower immediately prior to such
transaction own less than a majority of the aggregate voting power of the
acquiring entity immediately after the transaction, or (iv) a replacement at one
time or within a two (2) year period of more than one-half of the members of the
Borrower’s board of directors which is not approved by a majority of those
individuals who are members of the board of directors on the date hereof (or by
those individuals who are serving as members of the board of directors on any
date whose nomination to the board of directors was approved by a majority of
the members of the board of directors who are members on the date hereof), or
(v) the execution by the Borrower of an agreement to which the Borrower is a
party or by which it is bound, providing for any of the events set forth in
clauses (i) through (iv) above.

 

7.18     Applicable USA Contracts. Permit progress payments to Borrower under
Applicable USA Contracts to exceed five (5%) percent of Borrower’s revenues (as
reported on their financial statement) in any fiscal year.

 

 

 
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ARTICLE VIII:     EVENTS OF DEFAULT AND REMEDIES

 

8.1     Events of Default. Any of the following events shall constitute an Event
of Default:

 

(a)     The Borrower shall fail to pay (i) any principal of any Loans when due
(whether at the stated maturity, by acceleration or otherwise) in accordance
with the terms thereof or hereof or (ii) any interest on any Loans, or any fee
or other amount payable hereunder, after any such interest, fee or other amount
becomes due in accordance with the terms hereof; or

 

(b)     Any representation or warranty made or deemed made by the Borrower or
any other Loan Party herein or in any other Loan Document or which is contained
in any certificate, document or financial or other statement furnished at any
time under or in connection with this Agreement or any other Loan Document shall
prove to have been incorrect in any material respect on or as of the date made
or deemed made or furnished; or

 

(c)     The Borrower or any other Loan Party shall default in the observance or
performance of any covenant contained in Section 7, Section 6.1, Section 6.2 or
Section 6.7(a) (to the extent relating to notice of an Event of Default) hereof
or in any negative covenant contained in any Security Document to which it is a
party.

 

(d)     The Borrower or any other Loan Party shall default in the observance or
performance of any other agreement contained in this Agreement or any other Loan
Document other than as provided in (a) through (c) above, and such default shall
continue unremedied for a period of twenty (20) days, and after the earlier to
occur of (i) actual knowledge of such default by a Responsible Officer of the
Borrower and (ii) notice from the Administrative Agent to the Borrower; or

 

(e)     Any Loan Document shall cease, for any reason, to be in full force and
effect, or the Borrower or any other Loan Party shall so assert; or any Loan
Party shall default under any other agreement with any Lender; or any security
interest created by any of the Security Documents in a material portion of the
Collateral shall cease to be enforceable and of the same effect and priority
purported to be created thereby; or

 

(f)     (i) The Borrower or any of its Subsidiaries shall suffer or permit a
default (beyond any applicable notice or cure period) with respect to either (A)
default in any payment of principal of or interest on any Indebtedness (other
than Indebtedness under this Agreement and Indebtedness under Swap Contracts),
in the payment of any Guaranty Obligation beyond the period of grace, if any,
provided in the instrument or agreement under which such Indebtedness or
Guaranty Obligation was created in excess of one hundred thousand ($100,000)
dollars individually or in the aggregate; or (B) default in the observance or
performance of any other agreement or condition relating to any such
Indebtedness, Guaranty Obligation or contained in any instrument or agreement
evidencing, securing or relating thereto, or any other event shall occur or
condition exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness or, beneficiary
or beneficiaries of such Guaranty Obligation (or a trustee or agent on behalf of
such holder or holders or beneficiary or beneficiaries) to cause, with the
giving of notice if required, such Indebtedness to become due prior to its
stated maturity or such Guaranty Obligation to become payable (ii) there occurs
under any Swap Contract an Early Termination Date (as defined in such Swap
Contract) resulting from (A) any event of default under such Swap Contract as to
which a Loan Party or any Subsidiary thereof is the Defaulting Party (as defined
in such Swap Contract) or (B) any Termination Event (as so defined) under such
Swap Contract as to which a Loan Party or any Subsidiary thereof is an Affected
Party (as so defined) and, in either event, the Swap Termination Value owed by
such Loan Party or such Subsidiary as a result thereof is greater than $100,000;
or

 

 

 
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(g)     (i) The Borrower, any Domestic Subsidiary or any Foreign Subsidiary
shall commence any case, proceeding or other action (A) under any existing or
future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian or other
similar official for it or for all or any substantial part of its assets, or the
Borrower, any Domestic Subsidiary or any Foreign Subsidiary shall make a general
assignment for the benefit of its creditors; or (ii) there shall be commenced
against the Borrower, any Domestic Subsidiary or any Foreign Subsidiary any
case, proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such adjudication
or appointment or (B) remains undismissed, undischarged or unbonded for a period
of 60 days; or (iii) there shall be commenced against the Borrower, any Domestic
Subsidiary or any Foreign Subsidiary any case, proceeding or other action
seeking issuance of a warrant of attachment, execution, distraint or similar
process against all or any substantial part of its assets which results in the
entry of an order for any such relief which shall not have been vacated,
discharged, or stayed or bonded pending appeal within 60 days from the entry
thereof; or (iv) the Borrower, any Domestic Subsidiary or any Foreign Subsidiary
shall take any action in furtherance of, or indicating its consent to, approval
of, or acquiescence in, any of the acts set forth in clause (i), (ii), or (iii)
above; or (v) the Borrower, any Domestic Subsidiary or any Foreign Subsidiary
shall generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or

 

(h)     An ERISA Event shall have occurred that, when taken together with all
other ERISA Events that have occurred, could reasonably be expected to result in
liability of the Borrower and its Subsidiaries in an aggregate amount exceeding
$250,000; or

 

(i)     One or more judgments or decrees shall be entered against the Borrower
or any of its Subsidiaries involving in the aggregate a liability (not paid by
insurance or otherwise fully covered by insurance or paid by a third-party
indemnitor) and all such judgments or decrees requiring payments in excess of
one hundred thousand ($100,000) dollars shall not have been paid pursuant to its
terms, vacated, discharged, stayed or bonded pending appeal within 30 days from
the entry thereof; or

 

 

 
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(j)     (i) Any Person or “group” (within the meaning of Section 13(d) or 15(d)
of the Exchange Act), other than any Person or group beneficially owning 10% or
more of the Capital Stock of the Borrower on the date hereof (A) shall have
acquired, combined with previous holdings, beneficial ownership of 50% or more
of any outstanding class of Capital Stock of the Borrower having ordinary voting
power in the election of directors or (B) shall obtain the power (whether or not
exercised) to elect a majority of the Borrower’s directors; or (ii) the Board of
Directors of the Borrower shall not consist of a majority of Continuing
Directors; or

 

(k)     Borrower or any Loan Party shall default beyond any applicable cure
period under any lease of real property on which any Collateral is located; or

 

(l)     The Administrative Agent shall have determined in its commercially
reasonable discretion that one or more conditions exist or events have occurred
which have resulted in a material adverse change in the business, properties or
financial condition of the Borrower.

 

8.2     Remedies upon Event of Default.     If any Event of Default occurs and
is continuing, the Administrative Agent shall, at the request of, or may, with
the consent of, the Required Lenders, take any or all of the following actions:

 

(a)     declare the Commitment of each Lender to make Loans to be terminated,
whereupon such commitments and obligation shall be terminated;

 

(b)     declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest or other notice of any kind, all of which
are hereby expressly waived by the Borrower; and

 

(c)     exercise on behalf of itself, the Lenders all rights and remedies
available to it, the Lenders under the Loan Documents or applicable Law or
equity;

 

provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to the Borrower under the Bankruptcy Code of the
United States, the obligation of each Lender to make Loans shall automatically
terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become due and payable.

 

8.3     Application of Funds: After the exercise of remedies provided for in
Section 8.2 (or after the Loans have automatically become immediately due and
payable) or if at any time insufficient funds are received by and available to
the Administrative Agent to pay fully all Secured Obligations then due
hereunder, any amounts received on account of the Secured Obligations shall,
subject to the provisions of Section 2.9, be applied by the Administrative Agent
in the following order:

 

First, to payment of that portion of the Secured Obligations constituting fees,
indemnities, expenses and other amounts (including fees, charges and
disbursements of counsel to the Administrative Agent and amounts payable under
Article III) payable to the Administrative Agent in its capacity as such;

 

 

 
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Second, to payment of that portion of the Secured Obligations constituting fees,
indemnities and other amounts (other than principal and interest) payable to the
Lenders (including fees, charges and disbursements of counsel to the respective
Lenders arising under the Loan Documents and amounts payable under Article III,
ratably among them in proportion to the respective amounts described in this
clause Second payable to them;

 

Third, to payment of that portion of the Secured Obligations constituting
accrued and unpaid interest on the Loans, and other Secured Obligations arising
under the Loan Documents, ratably among the Lenders in proportion to the
respective amounts described in this clause Third payable to them;

 

Fourth, to payment of that portion of the Secured Obligations constituting
unpaid principal of the Loans, and Secured Obligations then owing under Secured
Swap Contracts and Secured Cash Management Agreements, ratably among the
Lenders, the Swap Provider and the Cash Management Banks in proportion to the
respective amounts described in this clause Fourth held by them; and

 

Last, the balance, if any, after all of the Secured Obligations have been
indefeasibly paid in full, to the Borrower or as otherwise required by Law.

 

Notwithstanding the foregoing, Secured Obligations arising under Secured Cash
Management Agreements and Secured Swap Contracts shall be excluded from the
application described above if the Administrative Agent has not received a
Secured Party Designation Notice, together with such supporting documentation as
the Administrative Agent may request, from the applicable Cash Management Bank.
Each Cash Management Bank not a party to this Agreement that has given the
notice contemplated by the preceding sentence shall, by such notice, be deemed
to have acknowledged and accepted the appointment of the Administrative Agent
pursuant to the terms of Article IX for itself and its Affiliates as if a
“Lender” party hereto.

 

ARTICLE IX:     THE AGENT AND THE ARRANGER

 

9.1     Appointment. Each Lender hereby irrevocably designates and appoints
BankUnited, N.A. as the Administrative Agent and as the Collateral Agent of each
such Lender under this Agreement and the other Loan Documents, and each Lender
irrevocably authorizes each of the Administrative Agent and the Collateral
Agent, in such respective capacities, to take such action on its behalf under
the provisions of this Agreement and the other Loan Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent and the Collateral Agent, as the case may be, by the terms
of this Agreement and the other Loan Documents, together with such other powers
as are reasonably incidental thereto. Notwithstanding any provision to the
contrary elsewhere in this Agreement, no Agent shall have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against any Agent.

 

 

 
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9.2     Delegation of Duties. Each Agent may execute any of its duties under
this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. No Agent shall be responsible for the
negligence or misconduct of any agents or attorneys-in-fact selected by it with
reasonable care.

 

9.3     Exculpatory Provisions. The Administrative Agent shall not have any
duties or obligations except those expressly set forth herein and in the other
Loan Documents, and its duties hereunder shall be administrative in nature.
Without limiting the generality of the foregoing, the Administrative Agent and
its Related Parties:

 

(a)     shall not be subject to any fiduciary or other implied duties,
regardless of whether a Default has occurred and is continuing;

 

(b)     shall not have any duty to take any discretionary action or exercise any
discretionary powers, except discretionary rights and powers expressly
contemplated hereby or by the other Loan Documents that the Administrative Agent
is required to exercise as directed in writing by the Required Lenders (or such
other number or percentage of the Lenders as shall be expressly provided for
herein or in the other Loan Documents), provided that the Administrative Agent
shall not be required to take any action that, in its opinion or the opinion of
its counsel, may expose the Administrative Agent to liability or that is
contrary to any Loan Document or applicable Law, including for the avoidance of
doubt any action that may be in violation of the automatic stay under any Debtor
Relief Law or that may effect a forfeiture, modification or termination of
property of a Defaulting Lender in violation of any Debtor Relief Law; and

 

(c)     shall not, except as expressly set forth herein and in the other Loan
Documents, have any duty or responsibility to disclose, and shall not be liable
for the failure to disclose, any information relating to any Loan Party or any
of its Affiliates that is communicated to or obtained by the Person serving as
the Administrative Agent or any of its Affiliates in any capacity.

 

Neither the Administrative Agent nor any of its Related Parties shall be liable
for any action taken or not taken by the Administrative Agent under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby or thereby (i) with the consent or at the request of the
Required Lenders (or such other number or percentage of the Lenders as shall be
necessary), or as the Administrative Agent shall believe in good faith shall be
necessary, under the circumstances as provided in Sections 10.1 and 8.2) or
(ii) in the absence of its own gross negligence or willful misconduct as
determined by a court of competent jurisdiction by final and nonappealable
judgment. Any such action taken or failure to act pursuant to the foregoing
shall be binding on all Lenders. The Administrative Agent shall be deemed not to
have knowledge of any Default unless and until notice describing such Default is
given in writing to the Administrative Agent by the Borrower or a Lender.

 

 

 
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Neither the Administrative Agent nor any of its Related Parties have any duty or
obligation to any Lender or participant or any other Person to ascertain or
inquire into (i) any statement, warranty or representation made in or in
connection with this Agreement or any other Loan Document, (ii) the contents of
any certificate, report or other document delivered hereunder or thereunder or
in connection herewith or therewith, (iii) the performance or observance of any
of the covenants, agreements or other terms or conditions set forth herein or
therein or the occurrence of any Default, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, any other Loan Document or any
other agreement, instrument or document, or the creation, perfection or priority
of any Lien purported to be created by the Security Documents, (v) the value or
the sufficiency of any Collateral, or (vi) the satisfaction of any condition set
forth in Article IV or elsewhere herein, other than to confirm receipt of items
expressly required to be delivered to the Administrative Agent.

 

9.4     Reliance by Agent. The Agent shall be entitled to rely, and shall be
fully protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, telecopy, telex or teletype message, statement,
order or other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and upon
advice and statements of legal counsel (including, without limitation, counsel
to the Borrower), independent accountants and other experts selected by such
Agent with reasonable care. The Agent may deem and treat the Person whose name
is recorded in the Register pursuant to the terms hereof as the owner thereof
for all purposes unless a written notice of assignment, negotiation or transfer
thereof shall have been filed with the Administrative Agent. The Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Loan Document unless it shall first receive such advice or
concurrence of the Required Lenders (or, to the extent provided in Section 10.1,
all of the Lenders) as it deems appropriate or it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such action.
The Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement and the other Loan Documents in accordance with a
request of the Required Lenders (or, to the extent provided in Section 10.1, all
of the Lenders), and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.

 

9.5     Notice of Default. No Agent shall be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating that
such notice is a “notice of default” (and, in the case of the Collateral Agent,
shall have received notice thereof as described in the following sentence). In
the event that the Administrative Agent receives such a notice, the
Administrative Agent shall promptly give notice thereof to the other Agents and
Lenders. The Administrative Agent shall take such action with respect to such
Default or Event of Default as shall be reasonably directed by the Required
Lenders (or, if so specified by this Agreement, all Lenders); provided that
unless and until the Administrative Agent shall have received such directions,
the Administrative Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders.

 

 

 
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9.6     Non-Reliance on Agent and Other Lenders. Each Lender expressly
acknowledges that no Agent or any Agent’s officers, directors, employees,
agents, attorneys-in-fact or Affiliates has made any representations or
warranties to it and that no act by any Agent hereafter taken, including any
review of the affairs of the Borrower shall be deemed to constitute any
representation or warranty by any Agent to any Lender. Each Lender represents to
each Agent that it has, independently and without reliance upon any Agent or any
other Lender, and based on such documents and information as it has deemed
appropriate, made its own appraisal of an investigation into the business,
operations, property, financial and other condition and creditworthiness of the
Borrower and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it will, independently and
without reliance upon the Agents, the Arranger or any other Lender, and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigation as it deems necessary to inform itself as to the business,
operations, property, financial and other condition and creditworthiness of the
Borrower. Except for notices, reports and other documents expressly required to
be furnished to the Lenders by the Administrative Agent or the Collateral Agent
hereunder, no Agent shall have any duty or responsibility to provide any Lender
with any credit or other information concerning the business, operations,
property, condition (financial or otherwise), prospects or creditworthiness of
the Borrower which may come into the possession of such Agent or any of its
officers, directors, employees, agents, attorneys-in-fact or Affiliates.

 

9.7     Indemnification. The Lenders agree to indemnify each Agent in its
capacity as such (to the extent not reimbursed by the Borrower and without
limiting the obligation of the Borrower to do so), ratably according to their
respective Total Loan Percentages in effect on the date on which indemnification
is sought (or, if indemnification is sought after the date upon which the
Commitments shall have terminated and the Loans shall have been paid in full,
ratably in accordance with their Total Loan Percentages immediately prior to
such date), from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Loans) be imposed on, incurred by or
asserted against such Agent in any way relating to or arising out of the
Commitments, this Agreement, any of the other Loan Documents or any documents
contemplated by or referred to herein or therein or the transactions
contemplated hereby or thereby or any action taken or omitted by such Agent
under or in connection with any of the foregoing; provided that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting solely from such Agent’s gross negligence or willful
misconduct. The agreements in this Section 9.7 shall survive the payment of the
Loans and all other amounts payable hereunder.

 

9.8     Agent in Its Individual Capacity. The entity which is an Agent and its
Affiliates may make extensions of credit to, accept deposits from and generally
engage in any kind of business with the Borrower as though the entity which is
such Agent were not such Agent hereunder and under the other Loan Documents.
With respect to the Loans made by it, such entity shall have the same rights and
powers under this Agreement and the other Loan Documents as any Lender and may
exercise the same as though it were not an Agent, and the terms “Lender” and
“Lenders” shall include the entity which is such Agent in its individual
capacity.

 

 

 
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9.9     Successor Agents.

 

(a)     Notice. The Administrative Agent may at any time resign as
Administrative Agent upon thirty (30) days notice to the Lenders and the
Borrower. Upon receipt of any such notice of resignation, the Required Lenders
shall have the right, in consultation with the Borrower, to appoint a successor,
which shall be a bank with an office in the United States, or an Affiliate of
any such bank with an office in the United States. If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment prior to the effective date of the resignation of the Administrative
Agent gives (the “Resignation Effective Date”), then the retiring Administrative
Agent may (but shall not be obligated to) on behalf of the Lenders, appoint a
successor Administrative Agent meeting the qualifications set forth above;
provided that if the Administrative Agent shall notify the Borrower and the
Lenders that no qualifying Person has accepted such appointment, then such
resignation shall nonetheless become effective.

 

(b)     Defaulting Lender. If the Person serving as Administrative Agent is a
Defaulting Lender pursuant to clause (d) of the definition thereof, the Required
Lenders may, to the extent permitted by applicable Law, by notice in writing to
the Borrower and such Person remove such Person as Administrative Agent and, in
consultation with the Borrower, appoint a successor. If no such successor shall
have been so appointed by the Required Lenders and shall have accepted such
appointment within thirty (30) days (or such earlier day as shall be agreed by
the Required Lenders) (the “Removal Effective Date”), then such removal shall
nonetheless become effective in accordance with such notice on the Removal
Effective Date.

 

(c)     Effect of Resignation or Removal. With effect from the Resignation
Effective Date or the Removal Effective Date (as applicable) (i) the retiring or
removed Administrative Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents (except that in the case of any
collateral security held by the Administrative Agent on behalf of the Lenders
under any of the Loan Documents, the retiring or removed Administrative Agent
shall continue to hold such collateral security until such time as a successor
Administrative Agent is appointed) and (ii) except for any indemnity payments or
other amounts then owed to the retiring or removed Administrative Agent, all
payments, communications and determinations provided to be made by, to or
through the Administrative Agent shall instead be made by or to each Lender
directly, until such time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided for above. Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, such successor shall succeed to
and become vested with all of the rights, powers, privileges and duties of the
retiring (or removed) Administrative Agent (and other than any rights to
indemnity payments or other amounts owed to the retiring or removed
Administrative Agent as of the Resignation Effective Date or the Removal
Effective Date, as applicable), and the retiring or removed Administrative Agent
shall be discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as provided above
in this Section). The fees payable by the Borrower to a successor Administrative
Agent shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring or removed
Administrative Agent’s resignation or removal hereunder and under the other Loan
Documents, the provisions of this Article and Section 11.4 shall continue in
effect for the benefit of such retiring or removed Administrative Agent, its
sub-agents and their respective Related Parties in respect of any actions taken
or omitted to be taken by any of them while the retiring or removed
Administrative Agent was acting as Administrative Agent.

 

 

 
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9.10      Secured Cash Management Agreements and Secured Swap Contracts. Except
as otherwise expressly set forth herein, no Cash Management Bank or Swap
Provider that obtains the benefit of the provisions of Sections 8.3 or 9.7, or
any Collateral by virtue of the provisions hereof or any Loan Document shall
have any right to notice of any action or to consent to, direct or object to any
action hereunder or under any other Loan Document or otherwise in respect of the
Collateral (including the release or impairment of any Collateral) (or to notice
of or to consent to any amendment, waiver or modification of the provisions
hereof or any Collateral Document) other than in its capacity as a Lender and,
in such case, only to the extent expressly provided in the Loan Documents.
Notwithstanding any other provision of this Article to the contrary, the
Administrative Agent shall not be required to verify the payment of, or that
other satisfactory arrangements have been made with respect to, Secured
Obligations arising under Secured Cash Management Agreements and Secured Swap
Contracts except to the extent expressly provided herein and unless the
Administrative Agent has received a Secured Party Designation Notice of such
Secured Obligations, together with such supporting documentation as the
Administrative Agent may request, from the applicable Cash Management Bank or
Swap Provider, as the case may be. The Administrative Agent shall not be
required to verify the payment of, or that other satisfactory arrangements have
been made with respect to, Secured Obligations arising under Secured Cash
Management Agreements and Secured Swap Contracts in the case of a Termination
Date

 

ARTICLE X:     MISCELLANEOUS

 

10.1     Amendments and Waivers.

 

(a)     Neither this Agreement nor any other Loan Document, nor any terms hereof
or thereof, may be amended, supplemented, waived or modified except in
accordance with the provisions of this Section 10.1. The Required Lenders may,
or, with the written consent of the Required Lenders, the Administrative Agent
may, from time to time, (y) enter into with the applicable Loan Parties written
amendments, supplements or modifications hereto and to the other Loan Documents
for the purpose of adding any provisions to this Agreement or the other Loan
Documents or changing in any manner the rights or obligations of the Lenders or
of the Borrower or of any other Loan Party hereunder or thereunder or (z) waive
at the Borrower’s request, on such terms and conditions as the Required Lenders
or the Administrative Agent, as the case may be, may specify in such instrument,
any of the requirements of this Agreement or the other Loan Documents or any
Default or Event of Default and its consequences; provided, however, that no
such waiver and no such amendment, supplement or modification shall:

 

 
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(i)     increase the Commitment of any Lender without the written consent of
such Lender,

 

(ii)     reduce the principal amount of any Loan or reduce the rate of interest
thereon or require any Lender to offer Interest Periods of longer than six
months without regard to availability, or reduce any fees payable hereunder,
without the written consent of each Lender affected thereby,

 

(iii)     postpone the scheduled date of payment of the principal amount of any
Loan or any interest thereon, or any fees payable hereunder, or reduce the
amount of, waive or excuse any such payment, or postpone the scheduled date of
expiration of any Commitment, without the written consent of each Lender
affected thereby,

 

(iv)     change Section 3.8 in a manner that would alter the pro rata sharing of
payments required thereby, without the written consent of each Lender affected
thereby,

 

(v)     release any Guaranty Agreements or Security Agreements or any Guarantor,
or all or substantially all of the Collateral under, and as defined in, the
Guaranty Agreements or Security Documents without the written consent of each
Lender,

 

(vi)     change any of the provisions of this Section 10.1 or the definition of
“Required Lenders” or any other provision hereof specifying the number or
percentage of Lenders required to waive, amend or modify any rights hereunder or
make any determination or grant any consent hereunder, without the written
consent of each Lender, or

 

(vii)     amend or waive any provisions of this Agreement or any other Loan
Document for purposes of determining whether the conditions precedent set forth
in Section 5.2 to the making of any Revolving Credit Loan have been satisfied
without the written consent of the Required Lenders.

 

(viii)     Notwithstanding anything to the contrary herein, (A) no Defaulting
Lender shall have any right to approve or disapprove any amendment, waiver or
consent hereunder (and any amendment, waiver or consent which by its terms
requires the consent of all Lenders or each affected Lender, or all Lenders or
each affected Lender under a Facility, may be effected with the consent of the
applicable Lenders other than Defaulting Lenders, except that (1) the Commitment
of any Defaulting Lender may not be increased or extended without the consent of
such Lender and (2) any waiver, amendment or modification requiring the consent
of all Lenders or each affected Lender, or all Lenders or each affected Lender
under a Facility, that by its terms affects any Defaulting Lender
disproportionately adversely relative to other affected Lenders shall require
the consent of such Defaulting Lender; (B) each Lender is entitled to vote as
such Lender sees fit on any bankruptcy reorganization plan that affects the
Loans, and each Lender acknowledges that the provisions of Section 1126(c) of
the Bankruptcy Code of the United States supersedes the unanimous consent
provisions set forth herein and (C) the Required Lenders shall determine whether
or not to allow a Loan Party to use cash collateral in the context of a
bankruptcy or insolvency proceeding and such determination shall be binding on
all of the Lenders.

 

 

 
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Notwithstanding anything to the contrary herein the Administrative Agent may,
with the prior written consent of the Borrower only, amend, modify or supplement
this Agreement or any of the other Loan Documents to cure any ambiguity,
omission, mistake, defect or inconsistency.

 

(b)     If, in connection with any proposed amendment, waiver or consent
requiring the consent of “each Lender” or “each Lender directly affected
thereby,” or the consent of the Required Lenders, and the consent of necessary
Lenders is not obtained (any such Lender whose consent is necessary but not
obtained being referred to herein as a “Non-Consenting Lender”), then the
Borrower may elect to replace a Non-Consenting Lender as a Lender party to this
Agreement, provided that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Borrower and the
Administrative Agent shall agree, as of such date, to purchase for cash the
Loans and other Obligations due to the Non-Consenting Lender pursuant to an
Assignment and Assumption and to become a Lender for all purposes under this
Agreement and to assume all obligations of the Non-Consenting Lender to be
terminated as of such date and to comply with the requirements of clause (c) of
Section 10.6(b)(i)(A), and (ii) the Borrower shall pay to such Non-Consenting
Lender in same day funds on the day of such replacement all interest, fees and
other amounts then accrued but unpaid to such Non-Consenting Lender by the
Company hereunder to and including the date of termination, including without
limitation payments due to such Non-Consenting Lender under Sections 3.6, 3.7,
3.8 and 3.9.

 

(c)     In addition to the foregoing, (x) no such amendment, supplement or
modification shall amend, modify or otherwise affect the rights or duties of any
Agent or any Lender hereunder without the prior written consent of such Agent or
the Lender, as the case may be, and (y) no such amendment, supplement,
modification or waiver shall amend, modify or otherwise affect Section 7.1 at a
time when a Default or Event of Default shall have occurred and be continuing
unless the Lenders holding a majority in interest of the Aggregate Revolving
Credit Commitments shall have consented in writing to such amendment,
modification or waiver. Any waiver and any amendment, supplement or modification
pursuant to this Section 10.1 shall apply to each of the Lenders and shall be
binding upon the Borrower, the applicable other Loan Parties, the Lenders, the
Agents and all future holders of the Loans. In the case of any waiver, the
Borrower, the Lenders and the Agents shall be restored to their former positions
and rights hereunder and under the other Loan Documents, and any Default or
Event of Default waived shall be deemed to be cured and not continuing; but no
such waiver shall extend to any subsequent or other Default or Event of Default,
or impair any right consequent thereon.

 

 

 
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10.2     Notices. All notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including by facsimile
transmission) and, unless otherwise expressly provided herein, shall be deemed
to have been duly given or made (a) in the case of delivery by hand, when
delivered, (b) in the case of delivery by mail, three days after being deposited
in the mails, postage prepaid, or (c) in the case of delivery by facsimile
transmission, when sent and receipt has been confirmed, addressed as follows in
the case of the Borrower and the Administrative Agent, and as set forth in
Schedule I in the case of the other parties hereto, or to such other address as
may be hereafter notified in writing by the respective parties hereto:

 

The Borrower:

CPI Aerostructures, Inc.

91 Heartland Boulevard

Edgewood, New York 11717

Attn:  Mr. Vincent Palazzolo

           Chief Financial Officer

 

 

with a copy to:

Graubard Miller

405 Lexington Avenue

New York, New York 10174

Attn:     David A. Miller, Esq.

   

The Administrative Agent and the Collateral Agent and the Swap Provider: 

BankUnited, N.A.

623 Fifth Avenue, 12th Floor

New York, New York 10022

Attn:  Ms. Christine Gerula

           Senior Vice President

    with a copy to: Certilman Balin Adler & Hyman LLP

90 Merrick Avenue

East Meadow, New York 11554

Attn: Kenneth A. Hoffmann, Esq.

                    

provided that any notice, request or demand to or upon any Agent or the Lenders
pursuant to Section 2.2, 2.4, 2.6, 2.8 or 3.2 shall not be effective until
received.

 

10.3     No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of any Agent or any Lender, any right, remedy, power or
privilege hereunder or under the other Loan Documents shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, remedy, power or
privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies,
powers and privileges herein provided are cumulative and not exclusive of any
rights, remedies, powers and privileges provided by law.

 

 

 
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10.4     Survival. All representations and warranties made hereunder, in the
other Loan Documents and in any document, certificate or statement delivered
pursuant hereto or in connection herewith shall survive the execution and
delivery of this Agreement and the making of the Loans hereunder until all
obligations hereunder and under the other Loan Documents have been paid in full
and the Commitments hereunder have been terminated. In addition to all other
covenants and agreements which are stated to survive the termination of this
Agreement and the payment of the Loans, the Notes and all other amounts payable
hereunder, the agreements in Section 3.12 shall survive the termination of this
Agreement and the payment of the Notes and all other amounts payable hereunder
until the expiration of the applicable statute of limitations for such taxes.

 

10.5     Payment of Expenses and Taxes; Indemnity. The Borrower agrees (a) to
pay or reimburse the Administrative Agent for all its reasonable out-of-pocket
costs and expenses incurred in connection with the development, preparation,
syndication and execution of, and any amendment, supplement or modification to,
this Agreement and the other Loan Documents and any other documents prepared in
connection herewith or therewith, and the consummation and administration of the
transactions contemplated hereby and thereby, including, without limitation, the
reasonable fees and disbursements of counsel to the Administrative Agent, (b) to
pay or reimburse each Lender and any Agent for all its reasonable costs and
expenses incurred during the continuance of any Default or Event of Default in
connection with the enforcement or preservation of any rights under this
Agreement, the other Loan Documents and any such other documents, including,
without limitation, the reasonable fees and disbursements of counsel to each
Lender and of counsel to the Agents, (c) to pay, indemnify, and hold harmless
each Lender and the Agent from, any and all recording and filing fees and any
and all liabilities with respect to, or resulting from any delay in paying,
Other Taxes, if any, which may be payable or determined to be payable in
connection with the execution and delivery of, or consummation or administration
of any of the transactions contemplated by, or any amendment, supplement or
modification of, or any waiver or consent under or in respect of, this
Agreement, the other Loan Documents and any such other documents, and (d) to
pay, indemnify, and hold harmless each Lender and the Administrative Agent and
their respective officers, directors, employees, subsidiaries, affiliates,
shareholders, agents and controlling persons (each, an “Indemnitee”) from and
against any and all other liabilities, obligations, losses, damages, settlement
payment, penalties, claims, actions, judgments, suits, costs, expenses or
disbursements of any kind or nature whatsoever with respect to the execution,
delivery, enforcement, performance and administration of this Agreement, the
other Loan Documents and related documents, the transactions contemplated
thereby, the use of the proceeds of the Loans, or the Collateral therefor,
including, without limitation, any of the foregoing relating to the violation
of, noncompliance with or liability under, any Environmental Law applicable to
the operations of the Borrower, any of its Subsidiaries or any of the Properties
(all the foregoing in this clause (d), collectively, the “indemnified
liabilities”), provided that the Borrower shall have no obligation hereunder to
the Administrative Agent or any Lender with respect to indemnified liabilities
solely arising from the gross negligence or willful misconduct of such
Indemnitee. In any such litigation, or the preparation therefor, the Borrower
may elect to assume the defense thereof with counsel retained by Borrower and
reasonably satisfactory to the Administrative Agent, however the Administrative
Agent and the Lenders shall be entitled to select their own counsel and, in
addition to the foregoing indemnity, the Borrower agrees to pay promptly the
reasonable fees and expenses of Indemnitees’ counsel, provided further that so
long as Indemnitees’ interests are similar in all material respects, the
Indemnitees shall endeavor to use the same counsel. The agreements in this
Section shall survive the termination of this Agreement and the repayment of the
Loans and all other amounts payable hereunder.

 

 

 
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10.6     Successors and Assigns; Participation and Assignments.

 

(a)     This Agreement shall be binding upon and inure to the benefit of the
Borrower, the Lenders, the Agent and their respective successors and assigns
permitted hereby, except that (i) the Borrower may not assign or transfer any of
its rights or obligations under this Agreement without the prior written consent
of each Lender (and any attempted assignment or transfer by the Borrower without
such consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
Section 10.6. Nothing in this Agreement, express or implied, shall be construed
to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby), Participants (to the extent provided
in paragraph (c) of this Section 10.6) and, to the extent expressly contemplated
hereby, the Related Parties of the Agent and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

(b)     (i)      Subject to the conditions set forth in clause (ii) below, any
Lender may assign to one or more assignees (“Eligible Assignees”) all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans at the time owing to it) with the prior
written consent (such consent not to be unreasonably withheld, delayed or
conditioned) of:

 

(A)     the Borrower, provided that no consent of the Borrower shall be required
at any time for an assignment to a Lender, an Affiliate of a Lender or an
Approved Fund (defined below), or for any assignment to any assignee prior to
completion of primary syndication of the Loans and Commitments hereunder (as
determined by the Arranger in its sole discretion) or if a Default or Event of
Default has occurred and is continuing; and

 

(B)     the Administrative Agent, provided that no consent of the Administrative
Agent shall be required for (i) an assignment of any Revolving Credit Commitment
to an assignee that is a Lender with a Revolving Credit Commitment immediately
prior to giving effect to such assignment or an Affiliate of such Lender or (ii)
an assignment of all or portion of a Term Loan to an assignee that is a Term
Lender immediately prior to giving effect to such assignment or an Affiliate of
such Lender.

 

(ii)     Assignments shall be subject to the following additional conditions:

 

(A)     except in the case of an assignment to a Lender or an Affiliate of a
Lender or an assignment of the entire remaining amount of the assigning Lender’s
Commitment or Loans of any Class, the amount of the Commitment or Loans of the
assigning Lender subject to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000.00 or unless each of the
Borrower and the Administrative Agent otherwise consents, provided that no such
consent of the Borrower shall be required prior to completion of primary
syndication of the Loans and Commitments hereunder (as determined by BankUnited,
N.A. in its sole discretion) or if a Default or Event of Default has occurred
and is continuing;

 

 

 
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(B)     each partial assignment shall be made as an assignment of a
proportionate part of all the assigning Lender’s rights and obligations under
this Agreement, provided that this clause shall not be construed to prohibit the
assignment of a proportionate part of all the assigning Lender’s rights and
obligations in respect of one Class of Commitments or Loans;

 

(C)     notwithstanding any provision to the contrary in (ii)(B) above, each
assignment of Term Loans by a Lender shall include a ratable assignment of Term
Loans made to the Borrower;

 

(D)     the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Acceptance, together with a processing
and recordation fee of $3,500, provided that only one such fee shall be payable
in the event of simultaneous assignments by a Lender to or from two or more
Approved Funds; and

 

(E)     the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent a completed Administrative Questionnaire.

 

(F)     No such assignment shall be made (A) to the Borrower or any of the
Borrower’s Affiliates or Subsidiaries, (B) to any Defaulting Lender or any of
its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would
constitute any of the foregoing Persons described in this clause (B), or (C) to
a natural Person.

 

(G)     In connection with any assignment of rights and obligations of any
Defaulting Lender hereunder, no such assignment shall be effective unless and
until, in addition to the other conditions thereto set forth herein, the parties
to the assignment shall make such additional payments to the Administrative
Agent in an aggregate amount sufficient, upon distribution thereof as
appropriate (which may be outright payment, purchases by the assignee of
participations or subparticipations, or other compensating actions, including
funding, with the consent of the Borrower and the Administrative Agent, the
applicable pro rata share of Loans previously requested but not funded by the
Defaulting Lender, to each of which the applicable assignee and assignor hereby
irrevocably consent), to (A) pay and satisfy in full all payment liabilities
then owed by such Defaulting Lender to the Administrative Agent or any Lender
hereunder (and interest accrued thereon) and (B) acquire (and fund as
appropriate) its full pro rata share of all Loans in accordance with its
respective applicable Percentage. Notwithstanding the foregoing, in the event
that any assignment of rights and obligations of any Defaulting Lender hereunder
shall become effective under applicable Law without compliance with the
provisions of this paragraph, then the assignee of such interest shall be deemed
to be a Defaulting Lender for all purposes of this Agreement until such
compliance occurs.

 

 

 
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For purposes of the minimum assignment sizes set forth in Section 10.6(b) (ii)
(A), simultaneous assignments to Approved Funds under common management by a
Lender shall be aggregated, provided that any such individual assignment shall
not be less than $500,000. For the purposes of this Section 10.6(b), the term
“Approved Fund” has the following meaning:

 

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender, provided that a
hedge fund or similar financial institution that operates like a hedge fund
shall not be deemed an Approved Fund.

 

(iii)     Subject to acceptance and recording thereof pursuant to paragraph
(b)(iv) of this Section, from and after the effective date specified in each
Assignment and Assumption the assignee thereunder (“Assignee”) shall be a party
hereto and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto). Any assignment or transfer by a Lender
of rights or obligations under this Agreement that does not comply with this
Section 10.6 shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.

 

(iv)     The Administrative Agent, acting for this purpose as an agent of the
Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitment of, and principal amount of the
Loans owing to, each Lender pursuant to the terms hereof from time to time (the
“Register”). The entries in the Register shall be conclusive, and the Borrower,
the Agents and the Lenders may treat each Person whose name is recorded in the
Register pursuant to the terms hereof as a Lender hereunder for all purposes of
this Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrower and any Lender, at any reasonable time
and from time to time upon reasonable prior notice.

 

 

 
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(v)     Upon its receipt of a duly completed Assignment and Assumption executed
by an assigning Lender and an Assignee, the Assignee’s completed Administrative
Questionnaire (unless the Assignee shall already be a Lender hereunder), the
processing and recordation fee referred to in paragraph (b) of this Section and
any written consent to such assignment required by paragraph (b) of this
Section, the Administrative Agent shall accept such Assignment and Assumption
and record the information contained therein in the Register. No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.

 

(c)     (i)     Any Lender may, without the consent of the Borrower, the
Administrative Agent or the other Lenders, sell participations to one or more
banks or other entities (a “Participant”) in all or a portion of such Lender’s
rights and obligations under this Agreement (including all or a portion of its
Commitment and the Loans owing to it); provided that (A) such Lender’s
obligations under this Agreement shall remain unchanged, (B) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations and (C) the Borrower, the Administrative Agent and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in clauses (ii), (iii) and (v) of
Section 10.1 that affects such Participant. Subject to paragraph (c) (ii) of
this Section, the Borrower agrees that each Participant shall be entitled to the
benefits of Sections 3.10, 3.11 and 3.12 to the same extent as if it were a
Lender and had acquired its interest by assignment pursuant to paragraph (b) of
this Section. To the extent permitted by law, each Participant also shall be
entitled to the benefits of Section 10.7 as though it were a Lender, provided
that such Participant agrees to be subject to Section 3.8 as though it were a
Lender. Each Lender that sells a participation shall, acting solely for this
purpose as an agent of the Borrower, maintain a register on which it enters the
name and address of each Participant and the principal amounts (and stated
interest) of each participant’s interest in the Loans or other obligations under
this Agreement (the “Participant Register”). The entries in the Participant
Register shall be conclusive absent manifest error, and such Lender shall treat
each person whose name is recorded in the Participant Register as the owner of
such participation for all purposes of this Agreement notwithstanding any notice
to the contrary.

 

(ii)     A Participant shall not be entitled to receive any greater payment
under Sections 3.10 or 3.12 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with the Borrower’s
prior written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.12 unless the Borrower
is notified of the participation sold to such Participant and such Participant
agrees, for the benefit of the Borrower, to comply with Section 3.12(f) as
though it were a Lender.

 

 

 
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(d)     Any Lender may at any time pledge or assign a security interest in all
or any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

 

10.7     Adjustments; Set-off.

 

(a)     If any Lender (a “Benefited Lender”) shall at any time receive any
payment of all or part of its Loans owing to it by the Borrower, or interest
thereon, or receive any collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, pursuant to events or proceedings of the nature
referred to in clause (h) of Section 8 or otherwise, except for payments
pursuant to the operation of Sections 3.14(b) or 10.6), in a greater proportion
than any such payment to or collateral received by any other Lender, if any, in
respect of such other Lender’s Loans owing to it by the Borrower or interest
thereon, such Benefited Lender shall purchase for cash from the other Lenders a
participating interest in such portion of each such other Lender’s Loan owing to
it by the Borrower or shall provide such other Lenders with the benefits of any
such collateral, or the proceeds thereof, as shall be necessary to cause such
Benefited Lender to share the excess payment or benefits of such collateral or
proceeds ratably with each of the Lenders; provided, however, that if all or any
portion of such excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the purchase price and
benefits returned, to the extent of such recovery, but without interest.

 

(b)     In addition to any rights and remedies of the Lenders provided by law,
each Lender shall have the right, without prior notice to the Borrower, any such
notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to set
off and appropriate and apply against such amount any and all deposits (general
or special, time or demand, provisional or final), in any currency, and any
other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower. Each Lender agrees promptly to notify the
Borrower and the Administrative Agent after any such set-off and application
made by such Lender, provided that the failure to give such notice shall not
affect the validity of such set-off and application.

 

10.8     Counterparts; Execution. This Agreement may be executed by one or more
of the parties to this Agreement on any number of separate counterparts
(including by facsimile transmission), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. A set of the
copies of this Agreement signed by all the parties shall be delivered to the
Borrower and the Administrative Agent. This Agreement may, upon execution, be
delivered by facsimile or electronic mail, which shall be deemed for all
purposes to be an original signature.

 

 

 
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10.9     Severability. Any provision of this Agreement 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, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction. Without limiting the foregoing provisions of this Section,
if and to the extent that the enforceability of any provisions in this Agreement
relating to Defaulting Lenders shall be limited by Debtor Relief Laws, as
determined in good faith by the Administrative Agent, then such provisions shall
be deemed to be in effect only to the extent not so limited.

 

10.10     Integration. This Agreement and the other Loan Documents represent the
entire agreement of the Borrower, the Agents and the Lenders with respect to the
subject matter hereof and thereof, and there are no promises, undertakings,
representations or warranties by the Borrower, any Agent or any Lender relative
to the subject matter hereof or thereof not expressly set forth or referred to
herein or in the other Loan Documents.

 

10.11     GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

10.12     Submission to Jurisdiction; Waivers. The parties hereby irrevocably
and unconditionally:

 

(a)     submits for itself and its property in any legal action or proceeding
relating to this Agreement or any other Loan Document to which it is a party, or
for recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof;

 

(b)     consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;

 

(c)     agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower at its
address set forth in Section 10.2 or at such other address of which the
Administrative Agent shall have been notified pursuant thereto; and

 

(d)     agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction.

 

 

 
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10.13     Acknowledgements. The Borrower hereby acknowledges that:

 

(a)     it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;

 

(b)     none of the Administrative Agent or any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Loan Documents, and the relationship between
the Administrative Agent and the Lenders, on the one hand, and the Borrower, on
the other hand, in connection herewith or therewith is solely that of debtor and
creditor; and

 

(c)     no joint venture is created hereby or by the other Loan Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrower and the Lenders.

 

10.14     WAIVERS OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM
THEREIN.

 

10.15     WAIVERS OF AUTOMATIC STAY. THE BORROWER AGREES THAT, IN THE EVENT THAT
BORROWER, ANY GUARANTOR OR ANY OF THE PERSONS OR PARTIES CONSTITUTING THE
BORROWER OR A GUARANTOR SHALL (i) FILE WITH ANY BANKRUPTCY COURT OF COMPETENT
JURISDICTION OR BE THE SUBJECT OF ANY PETITION UNDER TITLE 11 OF THE U.S. CODE,
AS AMENDED (“BANKRUPTCY CODE”), (ii) BE THE SUBJECT OF ANY ORDER FOR RELIEF
ISSUED UNDER THE BANKRUPTCY CODE, (iii) FILE OR BE THE SUBJECT OF ANY PETITON
SEEKING ANY REORGANIZATION, ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR FUTURE FEDERAL OR STATE ACT
OR LAW RELATING TO BANKRUPTCY, INSOLVENCY, OR OTHER RELIEF FOR DEBTORS, (iv)
HAVE SOUGHT OR CONSENT TO OR ACQUIESCED IN THE APPOINTMENT OF ANY TRUSTEE,
RECEIVER, CONSERVATOR, OR LIQUIDATOR, OR (v) BE THE SUBJECT OF ANY ORDER,
JUDGMENT, OR DECREE ENTERED BY ANY COURT OF COMPETENT JURISDICTION APPROVING A
PETITION FILED AGAINST SUCH PARTY FOR ANY REORGANIZATION, ARRANGEMENT,
COMPOSITION, READJUSTMENT, LIQUIDATION, DISSOLUTION, OR SIMILAR RELIEF UNDER ANY
PRESENT OR FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO BANKRUPTCY,
INSOLVENCY, OR RELIEF TO DEBTORS, THE ADMINISTRATIVE AGENT SHALL THEREUPON BE
ENTITLED AND THE BORROWER IRREVOCABLY CONSENTS TO IMMEDIATE AND UNCONDITIONAL
RELIEF FROM ANY AUTOMATIC STAY IMPOSED BY SECTION 362 OF THE BANKRUPTCY CODE, OR
OTHERWISE, ON OR AGAINST THE EXERCISE OF THE RIGHTS AND REMEDIES OTHERWISE
AVAILABLE TO THE ADMINISTRATIVE AGENT AS PROVIDED FOR HEREIN, OTHER LOAN
DOCUMENTS DELIVERED IN CONNECTION HEREWITH AND AS OTHERWISE PROVIDED BY LAW, AND
THE BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT TO OBJECT TO SUCH RELIEF AND
WILL NOT CONTEST ANY MOTION BY ADMINISTRATIVE AGENT SEEKING RELIEF FROM THE
AUTOMATIC STAY AND THE BORROWER WILL COOPERATE WITH ADMINISTRATIVE AGENT, IN ANY
MANNER REQUESTED BY ADMINISTRATIVE AGENT, IN ITS EFFORTS TO OBTAIN RELIEF FROM
SUCH STAY OR PROHIBITION.

 

 

 
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10.16     Confidentiality. Each Agent and Lender agrees to take normal and
reasonable precautions to maintain the confidentiality of information provided
to it by the Borrower or any Subsidiary in connection with this Agreement (and,
if delivered after the date of this Agreement, designated in writing as
confidential); provided, however, that any such Person may disclose such
information (a) at the request of any regulatory authority having supervisory
jurisdiction over it or in connection with an examination of such Person by any
such authority or the request of any rating agency requiring access to a
Lender’s portfolio, (b) pursuant to subpoena or other court process, (c) when
required to do so in accordance with the provisions of any applicable law, (d)
at the direction of any other Governmental Authority, (e) to such Person’s
Affiliates, independent auditors and other professional advisors (it being
understood that the Persons to whom such disclosure is made will be informed of
the confidential nature of such information and instructed to keep such
information confidential), (f) which has become generally available to the
public, other than as a result of a disclosure by such Person or agent of such
Person or a disclosure known to such Person or agent of such Person to have been
made by any person or entity to which such Person or agent has delivered such
confidential information, (g) which becomes available to such Person from a
source other than the Borrower or any Subsidiary (provided that such source is
not known to such Person to be bound by a duty of confidentiality to the
Borrower or any Subsidiary), (h) subject to an agreement containing provisions
substantially the same as those of this Section 10.16, to any actual or
prospective counterparty (or its advisors) to any swap or derivative transaction
relating to the Borrower and its obligations or (i) to any Participant or
Assignee or potential Participant or Assignee (each, a “Transferee”) or any
pledgee (or prospective pledgee) (each, a “Pledgee”) of any Lender that is a
Person (other than a natural person) that is engaged in making, purchasing,
holding or investing in bank loans and similar extensions of credit in the
ordinary course of its business; provided that such Transferee or Pledgee agrees
in writing to comply with the provisions of this Section 10.16.

 

10.17     USA Patriot Act. Each Lender hereby notifies the Borrower that
pursuant to the requirements of the USA Patriot Act (Title III of Pub. L. 107-56
(signed into law October 26, 2001)) (the “Patriot Act”), it is required to
obtain, verify and record information that identifies the Borrower, which
information includes the name and address of the Borrower and other information
that will allow such Lender to identify the Borrower in accordance with the
Patriot Act.

 

10.18     Federal Reserve Bank. The Administrative Agent may at any time pledge,
endorse, assign, or transfer all or a portion of its rights under the Loan
Documents to any of the twelve (12) Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act. 12 U.S.C. Section 341. No such pledge or
enforcement thereof shall release the Administrative Agent from its obligations
under any of the Loan Documents.

 

 

 
90

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10.19     Interest Adjustment. Notwithstanding anything to the contrary
contained in this Agreement, the rate of interest payable shall never exceed the
maximum rate of interest permitted under applicable law. If at any time the rate
of interest otherwise prescribed herein shall exceed such maximum rate, and such
prescribed rate is thereafter below such maximum rate, the prescribed rate shall
be increased to the maximum rate for such period of time as is required so that
the total amount of interest received by Lenders is that which would have been
received by Lenders except for the operation of the first sentence of this
Section 10.19.

 

10.20     Errors and Omissions. The Borrower hereby consents and agrees that in
the event any of the documents evidencing and/or securing the Loans misstate or
inaccurately reflect the true and correct terms and provisions of the Loans and
said misstatement or inaccuracy is due to the unilateral mistake on the part of
a Lender, mutual mistake on the part of a Lender and the Borrower or clerical
error, then in such event the Borrower shall, upon request of the Administrative
Agent and in order to correct such misstatement or inaccuracy, execute such new
documents as the Administrative Agent may deem necessary to remedy said
inaccuracy or mistake, provided however, such obligation on behalf of the
Borrower shall not extend to the execution of any new or redrafted document
which materially and adversely adds to or changes the obligations of the
Borrower beyond those set forth in or contemplated by the terms hereof. The
Borrower agrees to execute all such other and further documents as may or shall
be reasonably necessary, as determined solely by the Administrative Agent, in
order to give effect to the documents executed (whether in connection with the
Loans or any future loan) and so as to confirm the transaction. The Borrower
agrees to comply with the reasonable requirements of the Administrative Agent
within ten (10) days after written notice. Upon the Borrower failing or refusing
to comply with the terms and provisions of this Section, such failure shall
constitute a default by the Borrower under this Agreement and thereupon, the
Lenders shall have all the rights and remedies against the Borrower as otherwise
specified in this Agreement and other documents by reason of a default.

 

10.21     Replacement Documents. Upon receipt of an affidavit of an officer of
the Administrative Agent as to the loss, theft, destruction or mutilation of any
Loan Document or any other security document(s) which is not of public record
and, in the case of any such destruction or mutilation, upon surrender and
cancellation of any Loan Document or other document(s), the Borrower will issue,
in lieu thereof, a replacement note or other document(s) in the same principal
amount thereof and otherwise of like tenor.

 

 

 
91

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10.22     Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender and each of their respective Affiliates is hereby
authorized at any time and from time to time, to the fullest extent permitted by
applicable Law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final, in whatever currency) at any time held and
other obligations (in whatever currency) at any time owing by such Lender or any
such Affiliate to or for the credit or the account of the Borrower or any other
Loan Party against any and all of the obligations of the Borrower or such Loan
Party now or hereafter existing under this Agreement or any other Loan Document
to such Lender or their respective Affiliates, irrespective of whether or not
such Lender, or Affiliate shall have made any demand under this Agreement or any
other Loan Document and although such obligations of the Borrower or such Loan
Party may be contingent or unmatured, secured or unsecured, or are owed to a
branch, office or Affiliate of such Lender or different from the branch, office
or Affiliate holding such deposit or obligated on such indebtedness; provided
that in the event that any Defaulting Lender shall exercise any such right of
setoff, (a) all amounts so set off shall be paid over immediately to the
Administrative Agent for further application in accordance with the provisions
of Section 2.9 and, pending such payment, shall be segregated by such Defaulting
Lender from its other funds and deemed held in trust for the benefit of the
Administrative Agent, and the Lenders, and (b) the Defaulting Lender shall
provide promptly to the Administrative Agent a statement describing in
reasonable detail the Secured Obligations owing to such Defaulting Lender as to
which it exercised such right of setoff. The rights of each Lender, and their
respective Affiliates under this Section are in addition to other rights and
remedies (including other rights of setoff) that such Lender, or their
respective Affiliates may have. Each Lender and agrees to notify the Borrower
and the Administrative Agent promptly after any such setoff and application,
provided that the failure to give such notice shall not affect the validity of
such setoff and application.

  

[NO FURTHER TEXT ON THIS PAGE]

 

 

 
92

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.

 

 

CPI AEROSTRUCTURES, INC., as Borrower

 

 

 

 

 

 

 

 

 

 

By:

/s/ Vincent Palazzolo

 

 

 

Vincent Palazzolo

 

 

 

Chief Financial Officer

 

 

 

 

BANKUNITED, N.A., as Arranger, Agent, Lender

 

 

 

 

 

 

 

 

 

 

By:

/s/ Christine Gerula

 

 

 

Christine Gerula

 

 

 

Senior Vice President

 

 

 

 

CITIZENS BANK, N.A., as Lender

 

 

 

 

 

 

 

 

 

 

By:

/s/ Jamie Salas 

 

 

Name:

      Jamie Salas 

 

 

Title:

      Senior Vice President 

 

 

 

 
93

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SCHEDULE I

 

Commitments

 

Lender

 

Revolving Credit Commitment (%)

 

Term Commitment (%)

 

 

 

 

 

1. BankUnited, N.A.

 

$18,750,000 (62.5%) 

 

$6,250,000 (62.5%)

14817 Oak Lane

 

 

 

 

Miami Lakes, FL 33016

 

 

 

 

 

 

 

 

 

2. Citizens Bank, N.A.

 

$11,250,000 (37.5%) 

 

$3,750,000 (37.5%)

340 Madison Avenue

 

 

 

 

Suite 22C

 

 

 

 

New York, NY 10173-0002

 

 

 

 

 

 

 
94

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SCHEDULE 4.1

 

Financial Condition

  

 

None.

 

 

 
95

--------------------------------------------------------------------------------

 

 

SCHEDULE 4.6

 

Material Litigation

 

 

None.

 

 

 
96

--------------------------------------------------------------------------------

 

 

SCHEDULE 4.8

 

Ownership of Property; Liens

  

Fee Properties

 

None.

 

Leased Properties

 

The premises located at 91 Heartland Boulevard, Edgewood, New York, pursuant to
a lease agreement, dated June 30, 2011, between the Borrower and Heartland Boys
II L.P.

 

 

 
97

--------------------------------------------------------------------------------

 

 

SCHEDULE 4.10

 

Tax Filings and Payments

  

 

None.

 

 

 
98

--------------------------------------------------------------------------------

 

 

SCHEDULE 4.14

 

Subsidiaries

  

 

None.

 

 

 
99

--------------------------------------------------------------------------------

 

 

SCHEDULE 4.18

 

Insurance

  

SUMMARY OF INSURANCE

[ex10-1img001.gif]   Prepared by: Prepared for:

 

 

York International Agency, LLC

CPI Aerostructures, Inc.

 

 

500 Mamaroneck Ave

91 Heartland Blvd.

 

 

Harrison, NY 10528

Edgewood, NY 11717

 

 

914 376 2200

 

 

 

 

 

Y o r k I n t e r n a t i o n a l A g e n c y, L L C ● 500 Mamaroneck Avenue ●
Harrison, NY 10528

w w w . Y o r k i n t l . co m ● 9 1 4 - 3 7 6 - 2 2 0 0 ● 9 1 4 - 3 7 6 - 2 8 9
1 ( F a x )

 

Coverage

Amount

Company

Policy Number

Effective Date

Expiration Date

Premium

 

 

 

 

 

 

 

Commercial Package

 

Federal Insurance Co.

35837959 WBO

6/26/2015

6/26/2016

$ 123,968.18

91 Heartland BLVD

 

 

 

 

 

 

Edgewood, NY 11717

 

 

 

 

 

 

 

 

 

 

 

 

 

Property

 

Federal Insurance Co.

35837959 WBO

6/26/2015

6/26/2016

Included

 

 

 

 

 

 

 

Building

$13,700,000

 

 

 

 

 

Cause of Loss - Special Form

Included

 

 

 

 

 

Agreed Value

Included

 

 

 

 

 

Replacement Cost

Included

 

 

 

 

 

Deductible

$10,000

 

 

 

 

 

Personal Property

$20,000,000

 

 

 

 

 

Business Income/EE

$15,000,000

 

 

 

 

 

BI/EE Waiting Period

24 Hours

 

 

 

 

 

EDP Property

$250,000

 

 

 

 

 

In Transit

$200,000

 

 

 

 

 

Deductible

$1,000

 

 

 

 

 

 

 

 

 

 

 

 

General Liability

 

Federal Insurance Co.

35837959 WBO

6/26/2015

6/26/2016

Included

 

 

 

 

 

 

 

General Aggregate

$2,000,000

 

 

 

 

 

Each Occurrence

$1,000,000

 

 

 

 

 

 

 

 
100

--------------------------------------------------------------------------------

 

 

Personal & Advertising Injury

$1,000,000

 

 

 

 

 

Damage to Rented Premises

$1,000,000

 

 

 

 

 

Medical Expense (Any One Person)

$10,000

 

 

 

 

 

Employee Benefits

$1,000,000

 

 

 

 

 

Employee Benefits Deductible

$1,000

 

 

 

 

 

 

 

 

 

 

 

 

Auto

 

Federal Insurance Co.

73532853

6/26/2015

6/26/2016

$ 1,903.00

Liability CSL - Any Auto

$1,000,000

 

 

 

 

 

Medical Payments Each Person

$5,000

 

 

 

 

 

Uninsured Motorists

$1,000,000

 

 

 

 

 

Underinsured Motorists

$1,000,000

 

 

 

 

 

Comprehensive Deductible

$500

 

 

 

 

 

Collision Deductible

$500

 

 

 

 

 

2002 Ford Van 1FTSS34L02HB50719

 

 

 

 

 

 

 

 

 

 

 

 

 

Umbrella

 

Federal Insurance Co.

79849283

6/26/2015

6/26/2016

$ 23,851.00

Liability Limit Each Occurence

$5,000,000

 

 

 

 

 

Liability Aggregate

$5,000,000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Workers Compensation

 

Vigilant Ins. Co.

71734497

6/26/2015

6/26/2016

$ 571,743.00

Employer's Liability

 

 

 

 

 

 

   Each Accident

$1,000,000

 

 

 

 

 

   Disease - Policy Limit

$1,000,000

 

 

 

 

 

   Disease - Each Employee

$1,000,000

 

 

 

 

 

 

 

 

 

 

 

 

Aircraft Products Liability

 

USAIG

SIHL1597Z

12/1/2015

12/1/2016

$ 80,000.00

Products & Completed Ops Agg.

$100,000,000

 

 

 

 

 

 

 

 

 

 

 

 

Directors & Officers

 

Federal Insurance Co.

8207-4774

12/1/2015

12/1/2016

$ 82,390.00

Limit - Each Policy

$10,000,000

 

 

 

 

 

Deductible

$250,000

 

 

 

 

 

Security Deductible

$250,000

 

 

 

 

 

 

 

 
101

--------------------------------------------------------------------------------

 

 

Employment Practices

 

Federal Insurance Co.

8207-4777

12/1/2015

12/1/2016

$ 13,126.00

Each Loss

$2,000,000

 

 

 

 

 

Each Policy Period

$2,000,000

 

 

 

 

 

Third Party Liability

Included

 

 

 

 

 

Deductible

$25,000

 

 

 

 

 

Exec. Liability Blended

 

Federal Insurance Co.

8207-8177

12/1/2015

12/1/2016

$ 6,235.00

 

 

 

 

 

 

 

Crime

 

Federal Insurance Co.

8207-8177

12/1/2015

12/1/2016

Included

Employee Dishonesty

$500,000

 

 

 

 

 

Forgery/Alteration

$500,000

 

 

 

 

 

Deductible

$10,000

 

 

 

 

 

 

 

 

 

 

 

 

Fiduciary

 

Federal Insurance Co.

8207-8177

12/1/2015

12/1/2016

Included

Limit

$2,000,000

 

 

 

 

 

Deductible

$0

 

 

 

 

 

 

 

 

 

 

 

 

Disablity

 

Standard Security Life

R00906000

Continuous

N/A

 

 

 
102

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SCHEDULE 7.2

 

Existing Indebtedness and Subordinated Debt

 

Existing Indebtedness

 

1.

Revolving loan, term loans and other indebtedness pursuant to the Loan
Agreement, dated 8/13/07, as amended, between the Borrower and Sovereign Bank,
N.A.

 

2.

Obligations under the ISDA Master Agreement, dated 10/22/2008, between the
Borrower and Sovereign Bank, N.A. and the interest rate swap thereunder.

 

3.

Any indebtedness from time to time arising pursuant to the Supplier Agreement,
dated 4/9/09, between the Borrower and Citibank, N.A.

 

4.

Obligations under the Equipment Lease, dated 8/9/11, between the Borrower and
Marlin Business Bank, for Vertical Wave 2500 Telephone System and related
property.

 

5.

Obligations under the Equipment Lease, dated 10/13/11, between the Borrower and
Ricoh USA, for copiers.

 

6.

Obligations under the Equipment Lease, dated 11/4/11, between the Borrower and
Marlin Business Bank, for a Security Camera System and related property.

 

7.

Obligations under the Equipment Lease, dated 04/17/14, between the Borrower and
Ascentium Capital, for a Security Camera System and related property.

 

8.

Obligations under the Equipment Lease, dated 03/15/15, between the Borrower and
De Lage Landon Financial Services, for a DD2200 Computer Server and related
property.

 

9.

Obligations under the Equipment Lease, dated 10/0215, between the Borrower and
Signature Bank, for a Faro Technologies Laser Tracker and related property.

 

10.

Obligations under the Equipment Lease, dated 11//25/14, between the Borrower and
Ascentium Capital, for a Security Camera System and related property.

 

11.

Obligations under the Equipment Lease, dated 05/11/12, between the Borrower and
Direct Capital, for a Part Marking Machine and related property.

 

12.

Obligations under the Equipment Lease, dated 05/13/15, between the Borrower and
NMHG Financial, for a Yale Model Forklift and related property.

 

Subordinated Debt

 

None.

 

 

 
103

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SCHEDULE 7.3

 

Existing Liens

  

Type

Debtor

Secured Party

File No.

File Date

UCC

CPI Aerostructures, Inc.

Sovereign Bank

200804160278614

4/16/2008

   

Amended

201212130691646

12/13/2012

   

Amended

201212130691634

12/13/2012

UCC

CPI Aerostructures, Inc.

Citibank, N.A.

200907085624437

7/08/2009

   

Amended

201103115256086

3/11/2011

   

Amended

201403245291312

3/24/2014

   

Amended

201512316470383

12/31/2015

UCC

CPI Aerostructures, Inc.

Sovereign Bank

201105115500320

5/11/2011

UCC

CPI Aerostructures, Inc.

U.S. Bancorp Equipment Finance, Inc.

201105195531369

5/19/2011

UCC

CPI Aerostructures, Inc.

U.S. Bancorp Equipment Finance, Inc.

201106295706945

6/29/2011

UCC

CPI Aerostructures, Inc.

U.S. Bancorp Equipment, Finance Inc.

201107255802260

7/25/2011

UCC

CPI Aerostructures, Inc.

Marlin Business Bank

201108195906257

8/19/2011

UCC

CPI Aerostructures, Inc.

Marlin Business Bank

201111076239825

11/7/2011

UCC

CPI Aerostructures, Inc.

Ikon Financial Svcs

201112146393323

12/14/2011

UCC

CPI Aerostructures, Inc.

Corporation Service Company, as representative

201206255730394

6/25/2012

   

Amended

201206265734382

6/26/2012

   

Amended

201211066232302

11/6/2012

UCC

CPI Aerostructures, Inc.

Corporation Service Company, as representative

201207110393485

7/11/2012

   

Amended

201211060627707

11/6/2012

UCC

CPI Aerostructures, Inc.

Sovereign Bank, N.A., as Administrative and Collateral Agent for the Lenders

201212130691658

12/13/2012

UCC

CPI Aerostructures, Inc.

Ascentium Capital LLC

201404165385645

4/16//2014

UCC

CPI Aerostructures, Inc.

De Lage Laden Financial Services, Inc.

201502175160194

2/17/2015

UCC

CPI Aerostructures, Inc.

NMHG Financial Services, Inc.

201504135381679

4/13/2015

UCC

CPI Aerostructures, Inc.

Signature Financial LLC

201510026108115

10/2/2015

UCC

CPI Aerostructures, Inc.

Signature Financial LLC

201602045139271

2/4/2016

 

 

 
104

--------------------------------------------------------------------------------

 

 

SCHEDULE 7.4

 

Existing Guaranty Obligations

  

 

None.

 

 

 
105

--------------------------------------------------------------------------------

 

 

SCHEDULE 7.9(e)

 

Existing Investments

  

 

None.

 

 

 
106

--------------------------------------------------------------------------------

 

 

EXHIBIT A-1

[Form of Term Note]

 

AMENDED AND RESTATED TERM NOTE

 

$_______________     _____________, 2016

 

FOR VALUE RECEIVED, on the applicable Term Loan Maturity Date (as defined in the
Agreement), CPI AEROSTRUCTURES, INC., a New York corporation, having its
principal place of business at 91 Heartland Boulevard, Edgewood, New York 11717
(“Borrower”), promises to pay to the order of _______________ or its registered
assigns (“Bank”), at its offices located at _____________________, the aggregate
unpaid principal amount of the Term Loan made by the Bank to the Borrower
pursuant to Section 2.6 of the Agreement (as hereafter defined), payable in
consecutive monthly principal installments, each in the amount set forth in
Section 2.7 of the Agreement, such installments to be due and payable as set
forth in Section 2.7 of the Agreement. The Borrower further promises to pay
interest at said office in like money on the unpaid principal balance of this
Note from time to time outstanding at the annual rate described in Section 2.6
of the Agreement. Interest shall be payable as provided in the Agreement. After
the stated or accelerated maturity hereof, this Term Note shall bear interest at
a rate as set forth in the Agreement, payable on demand, but in no event in
excess of the maximum rate of interest permitted under any applicable law.

 

The Borrower shall make payment to the Bank at the Bank’s address above or such
other place as Bank may from time to time specify in writing in lawful currency
of the United States of America in immediately available funds, not later than
12:00 noon, New York City time on the date when due, without counterclaim or
setoff and free and clear of, and without any deduction or withholding for, any
taxes or other payments. The Borrower authorizes the Bank to charge its deposit
account maintained at the Bank for any payment due under this Term Note on the
due date thereof. Except as provided in the definition of “Interest Period” in
the Agreement, if any payment on this Term Note becomes due and payable on a day
which is not a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and interest thereon shall be payable during such
extension.

 

This Note is one of the Term Notes referred to in that certain Amended and
Restated Credit Agreement, dated as of March 24, 2016, among the Borrower, the
Lenders from time to time parties thereto and the Agent, as Administrative Agent
and Collateral Agent (as amended, restated, extended, supplemented or otherwise
modified in writing from time to time, the “Agreement”), is entitled to the
benefits thereof, and is subject to prepayment and its maturity is subject to
acceleration upon the terms contained in said Agreement. This Term Note is
secured by the collateral described in the Agreement. All capitalized terms used
in this Term Note and not defined herein shall have the meanings given them in
the Agreement.

 

Upon the occurrence of any one or more of the Events of Default specified in the
Agreement, all amounts then remaining unpaid on this Term Note may be declared
to be immediately due and payable as provided in the Agreement.

 

 

 
107

--------------------------------------------------------------------------------

 

 

If any action or proceeding be commenced to collect this Term Note or enforce
any of its provisions, Borrower further agrees to pay all costs and expenses of
such action or proceeding and attorneys' fees and expenses and further expressly
waives any and every right to interpose any counterclaim in any such action or
proceeding. Borrower hereby submits to the general jurisdiction of the courts of
the State of New York, the courts of the United States of America for the
Southern District of New York, and appellate courts from any thereof, and agrees
with Bank that personal jurisdiction over Borrower shall rest with courts of the
State of New York, the courts of the United States of America for the Southern
District of New York, and appellate courts from any thereof for purposes of any
action on or related to this Term Note, the liabilities, or the enforcement of
either or all of the same. Borrower hereby waives personal service by manual
delivery and agrees that service of process may be made by post-paid certified
mail directed to the Borrower at the Borrower's address set forth above or at
such other address as may be designated in writing by the Borrower to Bank in
accordance with Section 10.2 of the Agreement, and that upon mailing of such
process such service be effective with the same effect as though personally
served. Borrower hereby expressly waives any and every right to a trial by jury
in any action on or related to this Term Note, the liabilities or the
enforcement of either or all of the same.

 

This First Note may, upon execution, be delivered by facsimile or electronic
mail, which shall be deemed for all purposes to be an original signature.

 

Borrower and all endorsers and guarantors hereof waive presentment and demand
for payment, notice of non-payment, protest, and notice of protest. This Term
Note shall be construed in accordance with and governed by the laws of the State
of New York.

  

 

[NO FURTHER TEXT ON THIS PAGE]

 

 
108

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This Term Note together with the other Term Notes is being executed and
delivered as an amendment to and restatement of the outstanding indebtedness
evidenced by that certain term note, dated as of December 5, 2012, by Borrower
to Existing Lender (the “Existing Term Note”). No Term Note shall constitute a
cancellation or novation with respect to the indebtedness evidenced by the
Existing Term Note. Such indebtedness (as heretofore evidenced by the Existing
Term Note and as hereafter evidenced by the Term Notes) shall continue without
interruption in the lien or priority thereof. Subject to the foregoing
provisions the Term Notes amend, restate and supersede the Existing Term Note in
its entirety.

   

 

CPI AEROSTRUCTURES, INC.

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 
109

--------------------------------------------------------------------------------

 

 

EXHIBIT A-2

[Form of Revolving Credit Note]

 

AMENDED AND RESTATED REVOLVING CREDIT NOTE

 

$_______________          _____________, 2016

 

CPI AEROSTRUCTURES, INC., a New York corporation (the “Borrower”), for value
received, hereby promises to pay to the order of ____________________ or its
registered assigns (the “Bank”) at the office of the Bank located at
______________ on the Revolving Credit Termination Date as such term is defined
in the Amended and Restated Credit Agreement dated as of March 24, 2016, among
the Borrower, the Lenders from time to time parties thereto and the Agent, as
Administrative Agent and Collateral Agent (as amended, restated, extended,
supplemented or otherwise modified in writing from time to time, the
“Agreement”; terms defined in the Agreement shall have their defined meanings
when used in this Note), in lawful money of the United States of America and in
immediately available funds the principal amount of
_______________________________________________AND __/100 ($______________)
DOLLARS or, if less than such principal amount, the aggregate unpaid principal
amount of all Revolving Credit Loans made by the Bank to the Borrower pursuant
to Section 2.1 of the Agreement. The Borrower further promises to pay interest
at said office in like money on the unpaid principal balance of this Note from
time to time outstanding at an annual rate as selected by the Borrower pursuant
to the terms of Section 2.1 of the Agreement. Interest shall be computed on the
basis of a 360-day year for actual days elapsed and shall be payable as provided
in the Agreement. All Loans made by the Bank pursuant to Section 2.1 of the
Agreement and payments of the principal thereon may be endorsed by the holder of
this Note on the schedule annexed hereto, to which the holder may add additional
pages. The aggregate net unpaid amount of Revolving Credit Loans set forth in
such schedule shall be presumed to be the principal balance hereof. After the
stated or any accelerated maturity hereof, this Note shall bear interest at a
rate as set forth in the Agreement, payable on demand, but in no event in excess
of the maximum rate of interest permitted under applicable law.

 

This Note is one of the Revolving Credit Notes referred to in the Agreement, is
entitled to the benefits thereof, is secured by the Collateral and may be
prepaid, and is required to be prepaid, in whole or in part as provided in the
Agreement.

 

Upon the occurrence of any one or more of the Events of Default specified in the
Agreement, all amounts then remaining unpaid on this Note may be declared to be
immediately due and payable as provided in the Agreement.

 

This Note may, upon execution, be delivered by facsimile or electronic mail,
which shall be deemed for all purposes to be an original signature.

 

This Note shall be construed in accordance with and governed by the laws of the
State of New York.

 

 

 
110

--------------------------------------------------------------------------------

 

 

This Note (together with the other Revolving Credit Notes) is being executed and
delivered as an amendment and restatement of the prior revolving credit note, as
defined in the Existing Credit Agreement which was assigned to Agent and the
Lenders. No Revolving Credit Note shall constitute a cancellation or novation
with respect to the indebtedness evidenced by such prior revolving credit note.
Such indebtedness (as heretofore evidenced by such revolving credit note and as
hereafter evidenced by the Revolving Credit Notes) shall continue without
interruption in the lien or priority thereof. Subject to the foregoing
provisions the Revolving Credit Notes amend, restate and supersede the revolving
credit note (as defined in the Existing Credit Agreement) in its entirety.

   

 

CPI AEROSTRUCTURES, INC.

 

 

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

  

 

 
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SCHEDULE OF LOANS AND PAYMENT OF PRINCIPAL

TO REVOLVING CREDIT NOTE DATED AS OF MARCH 24, 2016

BY

CPI AEROSTRUCTURES, INC.

TO

__________________________

 

Date

Amount of Loan

Interest Rate

Last Day of Interest Period

Balance Principal Paid

Remaining Unpaid

Notation Made By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
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EXHIBIT B

[Form of Guaranty Agreement]

 

COMMERCIAL GUARANTY 

   

Borrower: CPI Aerostructures, Inc.

    91 Heartland Blvd.

    Edgewood, New York 11717

 

Guarantor:______________________

    ______________________

 

Lender:BankUnited, N.A., as Administrative Agent and Collateral Agent for the
Lenders defined below

Commercial Lending

14817 Oak Lane

Miami Lakes, Florida 33016

 

CONTINUING GUARANTEE OF PAYMENT AND PERFORMANCE. For good and valuable
consideration, Guarantor absolutely and unconditionally, jointly and severally
guarantees full and punctual payment and satisfaction of the Indebtedness
(defined below) of Borrower to BANKUNITED, N.A., as Administrative Agent and
Collateral Agent for the Lenders (the “Lender”) under that certain Credit
Agreement (defined below), and the performance and discharge of all Borrower’s
obligations under the Credit Agreement and the Related Documents. This is a
guaranty of payment and performance and not of collection, so Lender can enforce
this Guaranty against Guarantor even when Lender has not exhausted Lender’s
remedies against anyone else obligated to pay the Indebtedness or against any
collateral securing the Indebtedness, this Guaranty or any other guaranty of the
Indebtedness. Guarantor will make any payments to Lender or its order, on
demand, in legal tender of the United States of America, in same-day funds,
without set-off or deduction or counterclaim, and will otherwise perform
Borrower’s obligations under the Credit Agreement and Related Documents. Under
this Guaranty, Guarantor’s liability is unlimited and Guarantor’s obligations
are continuing. If more than one person executes this Guaranty, the obligations
hereunder shall be joint and several.

 

INDEBTEDNESS. The word “Indebtedness” as used in this Guaranty means all
Obligations under the Credit Agreement together with all of the principal amount
outstanding from time to time and at any one or more times, accrued unpaid
interest thereon and all collection costs and legal expenses related thereto
permitted by law, reasonable attorneys’ fees, arising from any and all debts,
liabilities and obligations of every nature or form, now existing or hereafter
arising or acquired, that Borrower individually or collectively or
interchangeably with others, owes or will owe Lender. “Indebtedness” includes,
without limitation, loans, advances, debts, overdraft indebtedness, credit card
indebtedness, lease obligations, other obligations, and liabilities of Borrower,
and any present or future judgments against Borrower, future advances, loans or
transactions that renew, extend, modify, refinance, consolidate or substitute
these debts, liabilities and obligations whether: voluntarily or involuntarily
incurred; due or to become due by their terms or acceleration; absolute or
contingent; liquidated or unliquidated; determined or undetermined; direct or
indirect; primary or secondary in nature or arising from a guaranty or surety;
secured or unsecured; joint or several or joint and several; evidenced by a
negotiable or non-negotiable instrument or writing; originated by Lender or
another or others; barred or unenforceable against Borrower for any reason
whatsoever; for any transactions that may be voidable for any reason (such as
infancy, insanity, ultra vires or otherwise); and originated then reduced or
extinguished and then afterwards increased or reinstated. Indebtedness also
includes, without limitation, all obligations of Borrower arising under any
interest rate, credit, commodity or equity swap, cap, floor, collar, forward
foreign exchange transaction, currency swap, cross currency rate swap, currency
option, securities puts, calls, collars, options or forwards or any combination
of, or option with respect to, these or similar transactions now or hereafter
entered into between Borrower and Lender.

 

 

 
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If Lender presently holds one or more guaranties, or hereafter receives
additional guaranties from Guarantor, Lender’s rights under all guaranties shall
be cumulative. This Guaranty shall not (unless specifically provided below to
the contrary) affect or invalidate any such other guaranties. Guarantor’s
liability will be Guarantor’s aggregate liability under the terms of this
Guaranty and any such other unterminated guaranties.

 

CONTINUING GUARANTY. THIS IS A “CONTINUING GUARANTY” UNDER WHICH GUARANTOR
AGREES TO GUARANTEE THE FULL AND PUNCTUAL PAYMENT, PERFORMANCE AND SATISFACTION
OF THE INDEBTEDNESS OF BORROWER TO LENDER, NOW EXISTING OR HEREAFTER ARISING OR
ACQUIRED, ON AN OPEN AND CONTINUING BASIS. ACCORDINGLY, ANY PAYMENTS MADE ON THE
INDEBTEDNESS WILL NOT DISCHARGE OR DIMINISH GUARANTOR’S OBLIGATIONS AND
LIABILITY UNDER THIS GUARANTY FOR ANY REMAINING AND SUCCEEDING INDEBTEDNESS EVEN
WHEN ALL OR PART OF THE OUTSTANDING INDEBTEDNESS MAY BE A ZERO BALANCE FROM TIME
TO TIME.

 

DURATION OF GUARANTY. This Guaranty will take effect when received by Lender
without the necessity of any acceptance by Lender, or any notice to Guarantor or
to Borrower, and will continue in full force until all the Indebtedness incurred
or contracted before receipt by Lender of any notice of revocation shall have
been fully and finally paid and satisfied and all of Guarantor’s other
obligations under this Guaranty shall have been performed in full. If Guarantor
elects to revoke this Guaranty, Guarantor may only do so in writing. Guarantor’s
written notice of revocation must be mailed to Lender, by certified mail, at
Lender’s address listed above or such other place as Lender may designate in
writing. Written revocation of this Guaranty will apply only to advances or new
Indebtedness created after actual receipt by Lender of Guarantor’s written
revocation. For this purpose and without limitation, the term “new Indebtedness”
does not include the Indebtedness which at the time of notice of revocation is
contingent, unliquidated, undetermined or not due and which later becomes
absolute, liquidated, determined or due. This Guaranty will continue to bind
Guarantor for all the Indebtedness incurred by Borrower or committed by Lender
prior to receipt of Guarantor’s written notice of revocation, including any
extensions, renewals, substitutions or modifications of the Indebtedness. All
renewals, extensions, substitutions, and modifications of the Indebtedness
granted after Guarantor’s revocation, are contemplated under this Guaranty and,
specifically will not be considered to be new Indebtedness. Release of any other
guarantor or termination of any other guaranty of the Indebtedness shall not
affect the liability of Guarantor under this Guaranty. A revocation Lender
receives from any one or more Guarantors shall not affect the liability of any
remaining Guarantors under this Guaranty. It is anticipated that fluctuations
may occur in the aggregate amount of the Indebtedness covered by this Guaranty,
and Guarantor specifically acknowledges and agrees that reductions in the amount
of the Indebtedness, even to zero dollars ($0.00), prior to Guarantor’s written
revocation of this Guaranty shall not constitute a termination of this Guaranty.
This Guaranty is binding upon Guarantor and Guarantor’s heirs, successors and
assigns so long as any of the Indebtedness remains unpaid and even though the
Indebtedness may from time to time be zero dollars ($0.00).

 

 

 
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GUARANTOR’S AUTHORIZATION TO LENDER. Guarantor authorizes Lender, either before
or after any revocation hereof, without notice or demand and without lessening
Guarantor’s liability under this Guaranty, from time to time: (A) prior to
revocation as set forth above, to make one or more additional secured or
unsecured loans to Borrower, to lease equipment or other goods to Borrower, or
otherwise to extend additional credit to Borrower; (B) to alter, compromise,
renew, extend, accelerate, or otherwise change one or more times the time for
payment or other terms of the Indebtedness or any part of the Indebtedness,
including increases and decreases of the rate of interest on the Indebtedness;
extensions may be repeated and may be for longer than the original loan term;
(C) to take and hold security for the payment of this Guaranty or the
Indebtedness, and exchange, enforce, waive, subordinate, fail or decide not to
perfect, and release any such security with or without the substitution of new
collateral; (D) to release, substitute, agree not to sue, or deal with any one
or more of Borrower’s sureties, endorsers, or other guarantors on any terms or
in any manner Lender may choose; (E) to determine how, when and what application
of payments and credits shall be made on the Indebtedness; (F) to apply such
security and direct the order or manner of sale thereof, including without
limitation, any non-judicial sale permitted by the terms of the controlling
security agreement or deed of trust, as Lender in its discretion may determine;
(G) to sell, transfer, assign or grant participations in all or any part of the
Indebtedness; and (H) to assign or transfer this Guaranty in whole or in part.

 

GUARANTOR’S REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to
Lender that (A) no representations or agreements of any kind have been made to
Guarantor which would limit or qualify in any way the terms of this Guaranty;
(B) this Guaranty is executed at Borrower’s request and not at the request of
Lender; (C) Guarantor has full power, right and authority to enter into this
Guaranty; (D) the provisions of this Guaranty do not conflict with or result in
a default under any agreement or other instrument binding upon Guarantor and do
not result in a violation of any law, regulation, court decree or order
applicable to Guarantor; (E) Guarantor has not and will not, without the prior
written consent of Lender, sell, lease, assign, encumber, hypothecate, transfer,
or otherwise● dispose of all or substantially all of Guarantor’s assets, or any
interest therein; (F) upon Lender’s request, but not more often than quarterly
(unless otherwise set forth in the Credit Agreement), Guarantor will provide to
Lender financial and credit information in form acceptable to Lender, and all
such financial information which currently has been, and all future financial
information which will be provided to Lender is and will be true and correct in
all material respects and fairly present Guarantor’s financial condition as of
the dates the financial information is provided; (G) no material adverse change
has occurred in Guarantor’s financial condition since the date of the most
recent financial statements provided to Lender and no event has occurred which
may materially adversely affect Guarantor’s financial condition; (H) no
litigation, claim, investigation, administrative proceeding or similar action
(including those for unpaid taxes) against Guarantor is pending or threatened,
other than any litigation, claim, investigation, administrative proceeding or
similar action that could not reasonably be expected to result in a material
adverse change to the Guarantor’s financial condition; (I) Lender has made no
representation to Guarantor as to the creditworthiness of Borrower; and (J)
Guarantor has established adequate means of obtaining from Borrower on a
continuing basis information regarding Borrower’s financial condition. Guarantor
agrees to keep adequately informed from such means of any facts, events, or
circumstances which might in any way affect Guarantor’s risks under this
Guaranty, and Guarantor further agrees that, absent a request for information,
Lender shall have no obligation to disclose to Guarantor any information or
documents acquired by Lender in the course of its relationship with Borrower.

 

 

 
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GUARANTOR’S FINANCIAL STATEMENTS. Each Guarantor agrees to furnish Lender with
the financial information set forth in the Credit Agreement on or before the due
date set forth therein.

 

GUARANTOR’S FINANCIAL COVENANTS. Each Guarantor shall maintain and/or comply
with the financial covenants set forth in the Credit Agreement.

 

GUARANTOR’S WAIVERS. Except as prohibited by applicable law, Guarantor waives
any right to require Lender (A) to continue lending money or to extend other
credit to Borrower; (B) to make any presentment, protest, demand, or notice of
any kind, including notice of any nonpayment of the Indebtedness or of any
nonpayment related to any collateral, or notice of any action or non-action on
the part of Borrower, Lender, any surety, endorser, or other guarantor in
connection with the Indebtedness or in connection with the creation of new or
additional loans or obligations; (C) to resort for payment or to proceed
directly or at once against any person, including Borrower or any other
guarantor; (D) to proceed directly against or exhaust any collateral held by
Lender from Borrower, any other guarantor, or any other person; (E) to pursue
any other remedy within Lender’s power; or (F) to commit any act or omission of
any kind, or at any time, with respect to any matter whatsoever.

 

Guarantor also waives any and all rights or defenses based on suretyship or
impairment of collateral including, but not limited to, any rights or defenses
arising by reason of (A) any “one action” or “anti-deficiency” law or any other
law which may prevent Lender from bringing any action, including a claim for
deficiency, against Guarantor, before or after Lender’s commencement or
completion of any foreclosure action, either judicially or by exercise of a
power of sale; (B) any election of remedies by Lender which destroys or
otherwise adversely affects Guarantor’s subrogation rights or Guarantor’s rights
to proceed against Borrower for● reimbursement, including without limitation,
any loss of rights Guarantor may suffer by reason of any law limiting,
qualifying, or discharging the Indebtedness; (C) any disability or other defense
of Borrower, of any other guarantor, or of any other person, or by reason of the
cessation of Borrower’s liability from any cause whatsoever, other than payment
in full in legal tender, of the Indebtedness; (D) any right to claim discharge
of the Indebtedness on the basis of unjustified impairment of any collateral for
the Indebtedness; (E) any statute of limitations, if at any time any action or
suit brought by Lender against Guarantor is commenced, there is outstanding
Indebtedness which is not barred by any applicable statute of limitations; or
(F) any defenses given to guarantors at law or in equity other than actual
payment and performance of the Indebtedness. If payment is made by Borrower,
whether voluntarily or otherwise, or by any third party, on the Indebtedness and
thereafter Lender is forced to remit the amount of that payment to Borrower’s
trustee in bankruptcy or to any similar person under any federal or state
bankruptcy law or law for the relief of debtors, the Indebtedness shall be
considered unpaid for the purpose of the enforcement of this Guaranty.

 

 

 
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Guarantor further waives and agrees not to assert or claim at any time any
deductions to the amount guaranteed under this Guaranty for any claim of setoff,
counterclaim, counter demand, recoupment or similar right, whether such claim,
demand or right may be asserted by the Borrower, the Guarantor, or both.

 

GUARANTOR’S UNDERSTANDING WITH RESPECT TO WAIVERS. Guarantor warrants and agrees
that each of the waivers set forth above is made with Guarantor’s full knowledge
of its significance and consequences and that, under the circumstances, the
waivers are reasonable and not contrary to public policy or law. If any such
waiver is determined to be contrary to any applicable law or public policy, such
waiver shall be effective only to the extent permitted by law or public policy.

 

RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Guarantor’s accounts with Lender (whether checking,
savings, or some other account and whether evidenced by a certificate of
deposit). This includes all accounts Guarantor holds jointly with someone else
and all accounts Guarantor may open in the future. However, this does not
include any IRA or Keogh accounts, or any trust accounts for which setoff would
be prohibited by law. Guarantor authorizes Lender, to the extent permitted by
applicable law, to hold these funds if there is a default, and Lender may apply
the funds in these accounts to pay what Guarantor owes under the terms of this
Guaranty.

 

SUBORDINATION OF BORROWER’S DEBTS TO GUARANTOR. Guarantor agrees that the
Indebtedness, whether now existing or hereafter created, shall be superior to
any claim that Guarantor may now have or hereafter acquire against Borrower,
whether or not Borrower becomes insolvent. Guarantor hereby expressly
subordinates any claim Guarantor may have against Borrower, upon any account
whatsoever, to any claim that Lender may now or hereafter have against Borrower.
In the event of insolvency and consequent liquidation of the assets of Borrower,
through bankruptcy, by an assignment for the benefit of creditors, by voluntary
liquidation, or otherwise, the assets of Borrower applicable to the payment of
the claims of both Lender and Guarantor shall be paid to Lender and shall be
first applied by Lender to the Indebtedness. Guarantor does hereby assign to
Lender all claims which it may have or acquire against Borrower or against any
assignee or trustee in bankruptcy of Borrower; provided however, that such
assignment shall be effective only for the purpose of assuring to Lender full
payment in legal tender of the Indebtedness. If Lender so requests, any notes or
credit agreements now or hereafter evidencing any debts or obligations of
Borrower to Guarantor shall be marked with a legend that the same are subject to
this Guaranty and shall be delivered to Lender. Guarantor agrees, and Lender is
hereby authorized, in the name of Guarantor, from time to time to file financing
statements and continuation statements and to execute documents and to take such
other actions as Lender deems necessary or appropriate to perfect, preserve and
enforce its rights under this Guaranty.

 

 

 
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MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of
this Guaranty:

 

Amendments. This Guaranty, together with any Related Documents, constitutes the
entire understanding and agreement of the parties as to the matters set forth in
this Guaranty. No alteration of or amendment to this Guaranty shall be effective
unless given in writing and signed by the party or parties sought to be charged
or bound by the alteration or amendment.

 

Attorneys’ Fees; Expenses. Guarantor agrees to pay upon demand all of Lender’s
costs and expenses, including Lender’s reasonable attorneys’ fees and Lender’s
legal expenses, incurred in connection with the enforcement of this Guaranty.
Lender may hire or pay someone else to help enforce this Guaranty, and Guarantor
shall pay the costs and expenses of such enforcement. Costs and expenses include
Lender’s reasonable attorneys’ fees and legal expenses whether or not there is a
lawsuit, including reasonable attorneys’ fees and legal expenses for bankruptcy
proceedings (including efforts to modify or vacate any automatic stay or
injunction), appeals, and any anticipated post-judgment collection services.
Guarantor also shall pay all court costs and such additional fees as may be
directed by the court.

 

Caption Headings. Caption headings in this Guaranty are for convenience purposes
only and are not to be used to interpret or define the provisions of this
Guaranty.

 

Governing Law. This Guaranty will be governed by federal law applicable to
Lender and, to the extent not preempted by federal law, the laws of the State of
New York without regard to its conflicts of law provisions. This Guaranty has
been accepted by Lender in the State of New York.

 

Integration. Guarantor further agrees that Guarantor has read and fully
understands the terms of this Guaranty; Guarantor has had the opportunity to be
advised by Guarantor’s attorney with respect to this Guaranty; the Guaranty
fully reflects Guarantor’s intentions and parol evidence is not required to
interpret the terms of this Guaranty. Guarantor hereby indemnifies and holds
Lender harmless from all losses, claims, damages, and costs (including Lender’s
attorneys’ fees) suffered or incurred by Lender as a result of any breach by
Guarantor of the warranties, representations and agreements of this paragraph.

 

Interpretation. In all cases where there is more than one Borrower or Guarantor,
then all words used in this Guaranty in the singular shall be deemed to have
been used in the plural where the context and construction so require; and where
there is more than one Borrower named in this Guaranty or when this Guaranty is
executed by more than one Guarantor, the words “Borrower” and “Guarantor”
respectively shall mean all and any one or more of them. The words “Guarantor,”
“Borrower,” and “Lender” include the heirs, successors, assigns, and transferees
of each of them. If a court finds that any provision of this Guaranty is not
valid or should not be enforced, that fact by itself will not mean that the rest
of this Guaranty will not be valid or enforced. Therefore, a court will enforce
the rest of the provisions of this Guaranty even if a provision of this Guaranty
may be found to be invalid or unenforceable. If any one or more of Borrower or
Guarantor are corporations, partnerships, limited liability companies, or
similar entities, it is not necessary for Lender to inquire into the powers of
Borrower or Guarantor or of the officers, directors, partners, managers, or
other agents acting or purporting to act on their behalf, and any indebtedness
made or created in reliance upon the professed exercise of such powers shall be
guaranteed under this Guaranty.

 

 

 
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Notices. Any notice required to be given under this Guaranty shall be given in
writing, and, except for revocation notices by Guarantor, shall be effective
when actually delivered, when actually received by telefacsimile (unless
otherwise required by law), when deposited with a nationally recognized
overnight courier, or, if mailed, when deposited in the United States mail, as
first class, certified or registered mail postage prepaid directed to the
addresses shown near the beginning of this Guaranty. All revocation notices by
Guarantor shall be in writing and shall be effective upon delivery to Lender as
provided in the section of this Guaranty entitled “DURATION OF GUARANTY.” Any
party may change its address for notices under this Guaranty by giving formal
written notice to the other parties, specifying that the purpose of the notice
is to change the party’s address. For notice purposes, Guarantor agrees to keep
Lender informed at all times of Guarantor’s current address. Unless otherwise
provided or required by law, if there is more than one Guarantor, any notice
given by Lender to any Guarantor is deemed to be notice given to all Guarantors.

 

No Waiver by Lender. Lender shall not be deemed to have waived any rights under
this Guaranty unless such waiver is given in writing and signed by Lender. No
delay or omission on the part of Lender in exercising any right shall operate as
a waiver of such right or any other right. A waiver by Lender of a provision of
this Guaranty shall not prejudice or constitute a waiver of Lender’s right
otherwise to demand strict compliance with that provision or any other provision
of this Guaranty. No prior waiver by Lender, nor any course of dealing between
Lender and Guarantor, shall constitute a waiver of any of Lender’s rights or of
any of Guarantor’s obligations as to any future transactions. Whenever the
consent of Lender is required under this Guaranty, the granting of such consent
by Lender in any instance shall not constitute continuing consent to subsequent
instances where such consent is required and in all cases such consent may be
granted or withheld in the sole discretion of Lender.

 

Successors and Assigns. Subject to any limitations stated in this Guaranty on
transfer of Guarantor’s interest, this Guaranty shall be binding upon and inure
to the benefit of the parties, their successors and assigns.

 

Waive Jury. Lender and Guarantor hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by either Lender or Borrower against
the other.

 

ERROR AND OMISSIONS. In consideration of the loan made by Lender to the
Borrower, the undersigned does hereby represent the promise as follows: Upon
request made by the Lender, its successors or assigns, the undersigned will
execute such documents as are reasonable to provide assurance to Lender (1) that
the obligations undertaken by the undersigned in connection with said loan will
be faithfully performed; (2) that any and all documents and installments signed
by the undersigned in connection with said loan are accurate statements as to
the truth of the matters set forth in them and constitute binding obligations
upon the undersigned according to their tenor; or (3) as to the amount of said
loan outstanding from time to time, and the date and amount of payments made in
respect to said loan. Upon request made by the Lender, its successors or
assigns, the undersigned will re-execute any document or instrument signed in
connection with said loan or execute any document or instrument that ought to
have been signed at or before closing of said loan, or which was incorrectly
drafted and signed, to facilitate full execution of the appropriate documents.
All such requests shall receive the full cooperation and compliance by the
undersigned within seven (7) days of the making of the request set forth above.
The failure of the undersigned to comply with their obligations hereunder shall
constitute a default under the documents executed in connection with said loan
and shall entitle Lender or its successors and assigns, to the remedies
available for default under the documents executed by the undersigned.

 

 

 
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DEFINITIONS. The following capitalized words and terms shall have the following
meanings when used in this Guaranty. Capitalized terms not defined herein shall
have the meanings set forth in the Credit Agreement. Unless specifically stated
to the contrary, all references to dollar amounts shall mean amounts in lawful
money of the United States of America. Words and terms used in the singular
shall include the plural, and the plural shall include the singular, as the
context may require. Words and terms not otherwise defined in this Guaranty or
the Credit Agreement shall have the meanings attributed to such terms in the
Uniform Commercial Code:

 

Borrower. The word “Borrower” means CPI Aerostructures, Inc. and includes all
co-signers and co-makers signing the Credit Agreement and all their successors
and assigns.

 

GAAP. The word “GAAP” means generally accepted accounting principles.

 

Guarantor. The word “Guarantor” means, collectively, each person signing this
Guaranty and any other Guaranty of the Indebtedness, and in each case, any
signer’s successors and assigns.

 

Guaranty. The word “Guaranty” means this guaranty from Guarantor to Lender.

 

Indebtedness. The word “Indebtedness” means Borrower’s indebtedness and
obligations to Lender as more particularly described in this Guaranty.

 

Lender. The word “Lender” shall have the meaning set forth in the first
paragraph of this Guaranty.

 

Credit Agreement. The Amended and Restated Credit Agreement between the
Borrower, the Lenders named therein and BankUnited, N.A., as Lender,
Administrative Agent, Collateral Agent and Swap Provider, dated as of March 24,
2016.

 

Note. The word “Note” means and includes without limitation all of Borrower’s
promissory notes and/or credit agreements evidencing Borrower’s loan obligations
in favor of Lender, together with all renewals of, extensions of, modifications
of, refinancings of, consolidations of and substitutions for promissory notes or
credit agreements.

 

 

 
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Obligations. The word “Obligations” shall have the meaning set forth in the
Credit Agreement.

 

Related Documents. The words “Related Documents” mean the Credit Agreement, the
Loan Documents defined in the Credit Agreement and all promissory notes, credit
agreements, loan agreements, environmental agreements, guaranties, security
agreements, mortgages, deeds of trust, security deeds, collateral mortgages,
interest rate swap documents (including, without limitation, any Swap Contract
between Borrower and Lender) and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection with the
Indebtedness.

 

EACH UNDERSIGNED GUARANTOR ACKNOWLEDGES HAVING READ ALL THE PROVISIONS OF THIS
GUARANTY AND AGREES TO ITS TERMS. IN ADDITION, EACH GUARANTOR UNDERSTANDS THAT
THIS GUARANTY IS EFFECTIVE UPON GUARANTOR’S EXECUTION AND DELIVERY OF THIS
GUARANTY TO LENDER AND THAT THE GUARANTY WILL CONTINUE UNTIL TERMINATED IN THE
MANNER SET FORTH IN THE SECTION TITLED “DURATION OF GUARANTY”. NO FORMAL
ACCEPTANCE BY LENDER IS NECESSARY TO MAKE THIS GUARANTY EFFECTIVE. THIS GUARANTY
IS DATED ______________, 20__.

  

GUARANTORS:

 

 

 

 

 

 

By:

 

 

 

 

Name

 

 

 

 

Title

 

 

 

 

 

State of New York, County of     _______________, ss:

 

On the ____day of _____________, in the year 20__, before me the undersigned,
personally appeared ________________, personally known to me or proved to me on
the basis of satisfactory evidence to be the individual whose name is subscribed
to the within instrument and acknowledged to me that he/she executed the same in
his/her capacity, and that by his/her signature on the instrument, the
individual or the person upon behalf of which the individual acted, executed the
instrument.

 

 

   

 

 

 

Notary Public

 

  

 

 
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EXHIBIT C

[Form of Assignment and Acceptance]

 

ASSIGNMENT AND ACCEPTANCE

 

Reference is made to the Amended and Restated Credit Agreement, dated as of
March 24, 2016 (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among CPI AEROSTRUCTURES, INC. (the “Company”,
the “Borrower”), the Lenders named therein, BANKUNITED, N.A. as Administrative
Agent and Collateral Agent for the Lenders. Unless otherwise defined herein,
terms defined in the Credit Agreement and used herein shall have the meanings
given to them in the Credit Agreement.

 

The Assignor identified on Schedule 1 hereto (the “Assignor”) and the Assignee
identified on Schedule 1 hereto (the “Assignee”) agree as follows:

 

1.     The Assignor hereby irrevocably sells and assigns to the Assignee without
recourse to the Assignor, and the Assignee hereby irrevocably purchases and
assumes from the Assignor without recourse to the Assignor, as of the Effective
Date (as defined below), the interest described in Schedule 1 hereto (the
“Assigned Interest”) in and to the Assignor’s rights and obligations under the
Credit Agreement with respect to those credit facilities contained in the Credit
Agreement as are set forth on Schedule 1 hereto (individually, an “Assigned
Facility”; collectively, the “Assigned Facilities”), in a principal amount for
each Assigned Facility as set forth on Schedule 1 hereto.

 

2.     The Assignor (a) makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Credit Agreement or with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Credit Agreement, any other Loan Document or any other instrument or
document furnished pursuant thereto, other than that the Assignor is the legal
beneficial owner of the Assigned Interest and that it has not created any
adverse claim upon the interest being assigned by it hereunder and that such
interest is free and clear of any such adverse claim; (b) makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower, any of its Subsidiaries or any other
obligor or the performance or observance by the Borrower, any of its
Subsidiaries or any other obligor of any of its respective obligations under the
Credit Agreement or any other Loan Document or any other instrument or document
furnished pursuant hereto or thereto; and (c) attaches any Notes held by it
evidencing the Assigned Facilities and (i) requests that the Administrative
Agent, upon request by the Assignee, exchange the attached Notes for a new Note
or Notes payable to the Assignee and (ii) if the Assignor has retained any
interest in the Assigned Facility, requests that the Administrative Agent
exchange the attached Notes for a new Note or Notes payable to the Assignor, in
each case in amounts which reflect the assignment being made hereby (and after
giving effect to any other assignments which have become effective on the
Effective Date).      

 

 

 
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3.     The Assignee (a) represents and warrants that it is legally authorized to
enter into this Assignment and Acceptance; (b) confirms that it has received a
copy of the Credit Agreement, together with copies of the financial statements
delivered pursuant to subsection 6.1 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it will,
independently and without reliance upon the Assignor, the Administrative Agent
or any other Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under the Credit Agreement, the other Loan Documents or any
other instrument or document furnished pursuant hereto or thereto; (d) appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Credit Agreement,
the other Loan Documents or any other instrument or document furnished pursuant
hereto or thereto as are delegated to the Administrative Agent by the terms
thereof, together with such powers as are incidental thereto; and (e) agrees
that it will be bound by the provisions of the Credit Agreement and will perform
in accordance with its terms all the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender including, if it
is organized under the laws of a jurisdiction outside the United States, its
obligation pursuant to subsection 3.12(f) of the Credit Agreement.

 

4.     The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the “Effective
Date”). Following the execution of this Assignment and Acceptance, it will be
delivered to the Administrative Agent for acceptance by it and recording by the
Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of such
acceptance and recording by the Administrative Agent).

 

5.     Upon such acceptance and recording, from and after the Effective Date,
the Administrative Agent shall make all payments in respect of the Assigned
Interest (including payments of principal, interest, fees and other amounts) to
the Assignor for amounts which have accrued to the Effective Date and to the
Assignee for amounts which have accrued subsequent to the Effective Date. The
Assignor and the Assignee shall make all appropriate adjustments in payments by
the Administrative Agent for periods prior to the Effective Date or with respect
to the making of this assignment directly between themselves.

 

6.     From and after the Effective Date, (a) the Assignee shall be a party to
the Credit Agreement and, to the extent provided in this Assignment and
Acceptance, have the rights and obligations of a Lender thereunder and under the
other Loan Documents and shall be bound by the provisions thereof and (b) the
Assignor shall, to the extent provided in this Assignment and Acceptance,
relinquish its rights and be released from its obligations under the Credit
Agreement.

 

 

 
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7.     This Assignment and Acceptance shall be governed by and construed in
accordance with the laws of the State of New York.

 

IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their respective
duly authorized officers on Schedule 1 hereto.

 

 

 
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Schedule 1
to Assignment and Acceptance

  

 

 

 

 

 

 

Name of Assignor:   

 

 

 

 

   

 

 

 

 

Name of Assignee:   

 

 

 

 

            Effective Date of Assignment:          

 

Credit Facility Assigned 

Principal Amount Assigned

Commitment Percentage Assigned

 

 

 

 

$           

          %

 

 

[Name of Assignee]    [Name of Assignor]  

 

 

 

 

 

By: 

 

 By:

 

 

Name:

 

 Name:

 

 

Title:

 

 Title:

 

 

   

Consented to:   Consented to:   BANKUNITED, N.A.,    CPI AEROSTRUCTURES, INC.  
as Administrative Agent        

 

 

 

 

 

By: 

 

 By:

 

 

Name:

 

 Name:

 

 

Title:

 

 Title:

 

 

 

Accepted:

 

 

 

 

BANKUNITED, N.A.,         as Administrative Agent                  

By:

 

 

 

 

Name:

 

 

 

 

Title:

 

 

 

 

 

 

 
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EXHIBIT D

 

[Form of Legal Opinion]

 

___________, 2016

 

BankUnited, N.A.

As Administrative Agent

623 Fifth Avenue, 12th Floor

New York, New York 10022

 

Ladies and Gentlemen:

 

We have acted as counsel to CPI Aerostructures, Inc., a New York corporation
(the “Borrower”), in connection with that certain Amended and Restated Credit
Agreement between the Borrower, the Lenders named therein and BankUnited, N.A.,
as Sole Arranger, Administrative Agent and Collateral Agent (the “Bank”) of even
date herewith (the “Credit Agreement”). In connection with this opinion, we have
examined executed copies of the Credit Agreement and each of the Revolving
Credit Note, the Term Note, the Security Agreement (as each such term is defined
in the Credit Agreement) and unfiled copies of UCC Financing Statement
Amendments naming Borrower as debtor and naming the Administrative Agent as
secured party (the “UCC Financing Statement Amendments”), the other Loan
Documents (as defined in the Credit Agreement) and any other loan document
executed in connection with the Credit Agreement that has been provided to us
(collectively, the “Loan Documents”), corporate documents and records of the
Borrower, and such other documents as we have deemed necessary or appropriate
for the purposes of this opinion. In stating our opinion, we have assumed the
genuineness of all signatures of, and the authority of, persons signing the Loan
Documents, the authenticity of all documents submitted to us as originals and
the conformity to authentic original documents of all documents submitted to us
as certified, conformed or photostatic copies.

 

We have assumed for the purposes of the opinions expressed herein, (i) that the
Credit Agreement and the other Loan Documents were duly authorized, executed and
delivered by all parties thereto (other than the Borrower), (ii) that the Credit
Agreement and the other Loan Documents were the legal, valid and binding
obligation of such party (other than the Borrower), enforceable against such
parties (other than the Borrower) in accordance with their terms, and (iii) that
the parties to the Credit Agreement and the other Loan Documents (other than the
Borrower) have the requisite power and authority to enter into and perform the
Credit Agreement and the other Loan Documents.

 

In addition, we have assumed that (i) the Borrower has, and will have at all
times relevant to this opinion, rights in the collateral as to which a security
interest has been granted pursuant to the Security Agreement within the meaning
of Section 9-203(b)(2) of the UCC (as defined below) and (ii) the Lender gave
“value” within the meaning of Section 1-201(44) of the UCC.

 

 In rendering this opinion, as to factual matters not directly within our
knowledge, we have relied upon and have assumed the accuracy, completeness and
genuineness of representations made by the Borrower set forth in the Agreement
and the other Loan Documents and such certificates of public officials as we
have deemed necessary or appropriate, and we have undertaken no independent
investigation with respect to any such factual matter. With respect to
Borrower’s valid existence and good standing referenced in opinion Paragraph 1,
we have relied entirely on a good standing certificate from the Department of
State of the State of New York (the “Department of State”). In rendering and for
purposes of this opinion, with your permission, we have not conducted a
litigation search in respect of the Borrower.

 

 

 
126

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Based upon the foregoing, we are of the opinion that:

 

1.     The Borrower is a corporation duly organized, validly existing and in
good standing under the laws of the State of New York, has the requisite
corporate authority, power and legal right to own and operate its properties, to
lease properties it operates and to conduct its business as now conducted.

 

2.     The Borrower has the corporate power, authority and legal right to
execute, deliver and perform the Loan Documents in accordance with their
respective terms, and has taken all necessary corporate action to authorize the
execution, delivery and performance of the Loan Documents. To our knowledge, no
consent or authorization of, filing with, or other act by or in respect of any
governmental authority is required in connection with the execution, delivery,
performance, validity or enforceability of the Loan Documents other than the
filing of the UCC Financing Statement Amendment.

 

3.     Each of the Loan Documents has been duly executed and delivered on behalf
of the Borrower and each constitutes a legal, valid and binding obligation of
the Borrower enforceable against the Borrower in accordance with its terms.

 

4.     The execution, delivery and performance of the Loan Documents will not
violate any provision of law or regulation or any order or decree of any
governmental agency or constitute a default under or result in the breach of the
certificate of incorporation or the by-laws of the Borrower or, to our
knowledge, any material indenture or loan or credit agreement or any other
material agreement, lease or instrument to which the Borrower is a party or by
which its property is bound or affected and will not result in, or require, the
creation or imposition of any lien on any of its properties pursuant to any
requirement of law or, to our knowledge, contractual obligations other than the
Loan Documents.

 

5.     By executing and delivering the Security Agreement, the Borrower has
granted to the Bank as Agent for the Lenders a valid security interest in the
property described as collateral therein to the extent a security interest
therein may be created under Article 9 of the New York Uniform Commercial Code
(the “UCC”). The filing of the UCC Financing Statement Amendments with the
Department of State, amending the existing Sovereign Bank, N.A. filings against
personal property dated (i) April 16, 2008 as File Number 200804160278614, as
amended on December 13, 2012 by File Numbers 201212130691646 and 201212130691634
and (ii) December 13, 2012 as File Number 201212130691658 (together, the
“Financing Statements”), will maintain the fully-perfected security interest in
the collateral described in the Financing Statements and will perfect a security
interest in the collateral described in the UCC Financing Statement Amendments
that is not described in the Financing Statements. Based solely on a current
search of the records of the Department of State, we are aware of no UCC filing
or lien against the Borrower prior in right or lien to the security interests
created under the Security Agreement except the existing liens set forth on
Schedule 7.3 to the Credit Agreement (collectively, the “Permitted Liens”). No
further action is necessary to create perfected security interests (subject only
to the Permitted Liens) in the property pledged as collateral under the Security
Agreement to the extent a security interest may be perfected in such property
under Article 9 of the UCC.

 

6.     To our knowledge, except as set forth in Schedule 4.6 to the Credit
Agreement, there is no litigation, investigation or proceeding of or before any
arbitrator, court or governmental authority pending or threatened by or against
or with respect to the Borrower, the Loan Documents, or any of the transactions
contemplated thereby, which, if adversely determined, would have a material
adverse effect on the business, assets or financial condition of the Borrower.

 

 

 
127

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Where an opinion is qualified by our knowledge as to a certain matter relating
to the Borrower, knowledge is deemed to be based on the actual knowledge of
those attorneys that are currently employed by this firm as of the date of this
opinion who have been actively engaged on matters for which we have been
employed by Borrower.

 

The foregoing opinions are subject to the effect of rules of law relating to the
following: (i) bankruptcy, reorganization, insolvency, moratorium and/or similar
laws of general application relating to or affecting the rights and remedies of
creditors and the obligations of debtors; (ii) equitable principles of general
application including principles of commercial reasonableness, good faith and
fair dealing (regardless of whether such equitable principles are considered in
an action or proceeding at law or in equity); (iii) the enforceability of any
indemnification or contribution provisions as they may be limited under federal
or state laws; (iv) constitutional and public policy limitations (regardless of
whether considered in an action or proceeding at law or in equity); (v) the
enforceability of provisions of a contract that purport to waive, or require
waiver of, the obligations of good faith, fair dealing, diligence and
reasonableness; (vi) the availability of a remedy under certain circumstances
where another remedy has been elected; (vii) limitation on the time after which
a remedy may not be enforced; (viii) the enforceability of provisions releasing,
exculpating or exempting a party from, or requiring indemnification of a party
for, liability for its own action or inaction, to the extent the action or
inaction involves gross negligence, recklessness, willful misconduct, unlawful
conduct, violation of law or public policy or litigation against another party
determined adversely to such party; (ix) provisions that, if less than all of
the contract is unenforceable, limit the enforceability of the remainder of the
contract to circumstances in which the unenforceable portion is not an essential
part of the agreed exchange; (x) provisions that govern and afford judicial
discretion regarding the determination of damages and entitlement to attorneys’
fees and other costs; and (xi) provisions that permit a party that has
materially failed to render or offer performance required by the contract to
cure that failure unless (a) permitting a cure would unreasonably hinder the
aggrieved party from making substitute arrangements for performance or (b) it
was important in the circumstances to the aggrieved party that performance occur
by the date stated in the contract.

 

Notwithstanding our opinions expressed herein, no opinion is expressed with
respect to the following kinds of provisions in any agreements: (i) choice of
law provisions; (ii) provisions mandating contribution towards judgments or
settlements among various parties; (iii) waivers of (a) legal or equitable
defenses, (b) rights to damages; (c) rights to counter claim or set off, (d)
statutes of limitations, (e) rights to notice, (f) the benefits of statutory,
regulatory or constitutional rights, unless and to the extent the statute,
regulation or constitution explicitly allows waiver, (g) provisions that
authorize self-help and (h) other benefits to the extent they cannot be waived
under applicable law; (iv) provisions providing for forfeitures or the recovery
of amounts deemed to constitute penalties or for liquidated damages; (v)
provisions to submit to the jurisdiction of any process requirements which would
otherwise be applicable, and provisions otherwise purporting to affect the
jurisdiction and venue of courts; (vi) provisions that attempt to change or
waive rules of evidence or fix the method or quantum of proof to be applied in
litigation or similar proceedings; and (vii) any federal, state or local law
relating to the environment, antitrust, patents and trademarks and intellectual
property generally, and telecommunications.

 

We express no opinion with respect to (i) the enforceability of any security
interest in the proceeds of any collateral other than pursuant to Section 9-315
of the UCC, (ii) any security interest in commercial tort claims or (iii) any
collateral of a type described in Section 9-501(a)(1) of the UCC. We express no
opinion with respect to the priority of any security interest or lien in any
collateral and, except as expressly provided in opinion Paragraph 5 above, we
further express no opinion as to the respective rights of any creditor,
encumbrancer or other third party as against the rights of the Lenders (as
defined in the Credit Agreement). In addition, our opinions relating to the
creation and perfection of security interests may be limited by the effect of
Sections 9-406, 9-407, 9-408 and 9-409 of the UCC.

 

 

 
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No opinion is expressed herein other than as to the law of the State of New York
and the Federal law of the United States of America. We express no opinion with
respect to the law of any other state of the United States or any foreign
country.

 

This opinion is furnished in accordance with the Guidelines for the Preparation
of Closing Opinions promulgated by the Section of Business Law of the American
Bar Association (February 2002), and is to be interpreted in accordance
therewith. This opinion letter is limited to the matters stated herein, and no
opinion is implied or may be inferred beyond the matters expressly stated. This
opinion letter is rendered as of the date first written above, and we disclaim
any obligation to advise you of facts, circumstances, events or developments
which hereafter may be brought to our attention and which may alter, affect or
modify the opinion expressed herein.

 

This opinion is addressed solely to the addressee, is being delivered only to
the addressee and may be relied upon only by the addressee, any other persons
who become parties to the Credit Agreement as Lenders and their respective
successors and assigns.

  

Very truly yours,

  

 

 
129

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SCHEDULE A

 

Permitted Liens

 

[MUST BE UPDATED AND INSERTED]

 

 

 
130

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EXHIBIT E

[Form of Closing Certificate]

 

CLOSING CERTIFICATE

 

Pursuant to subsection 5.1(c) of the Amended and Restated Credit Agreement,
dated as of March 24, 2016 (as the same may be amended, supplemented or
otherwise modified from time to time, the “Credit Agreement”), among CPI
AEROSTRUCTURES, INC., a New York corporation (the “Company”), the Lenders party
thereto, and BANKUNITED, N.A., as Lead Arranger, Administrative Agent and
Collateral Agent, the undersigned, being President of the Loan Party below,
hereby certifies, as follows with respect to such Loan Party:

 

1.     The representations and warranties of such Loan Party set forth in the
Credit Agreement and each of the other Loan Documents to which it is a party or
which are contained in any certificate, document or financial or other statement
furnished pursuant to or in connection with the Credit Agreement or any other
Loan Document are true and correct in all material respects on and as of the
date hereof with the same effect as if made on the date hereof, except for
representations and warranties expressly stated to relate to a specific earlier
date, in which case such representations and warranties are true and correct in
all material respects as of such earlier date;

 

2.     No Default or Event of Default has occurred and is continuing as of the
date hereof or will occur after giving effect to the extensions of credit
requested to be made on the date hereof or the consummation of each of the
transactions contemplated by the Loan Documents;

 

3.     There are no liquidation or dissolution proceedings pending or to my
knowledge threatened against the Company, nor has any other event occurred
affecting or threatening the corporate existence of the Company; and

 

4.     Each Loan Party is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization.

 

Unless otherwise defined herein, capitalized terms which are defined in the
Credit Agreement and used herein are so used as so defined.

 

IN WITNESS WHEREOF, the undersigned have hereunto set our names as of the date
first written above.

 

 

 

By: /s/ Vincent Palazzolo          

 

Name: Vincent Palazzolo

Title:   Chief Financial Officer

CPI Aerostructures, Inc.

 

 

 
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EXHIBIT F

[Form of Covenant Compliance Certificate]

 

COMPLIANCE CERTIFICATE

 

TO:

 

The undersigned hereby certifies that:

 

1.     This Compliance Certificate is being delivered pursuant to the provisions
of that certain Amended and Restated Credit Agreement dated as of March 24, 2016
(the “Agreement”), among CPI AEROSTRUCTURES, INC. (“Borrower”), the Lenders
party thereto and BANKUNITED, N.A., as Lead Arranger, Administrative Agent and
Collateral Agent. Any and all initially capitalized terms used herein have the
meanings ascribed thereto in the Agreement unless otherwise specifically defined
herein.

 

2.     The undersigned is the [_______________] of Borrower.

 

3.     The undersigned represents and warrants as follows:

 

a.     The representations and warranties contained in Section 4 of the
Agreement and the representations and warranties contained in the other Loan
Documents are true and correct, as though made on and as of this date, except
for representations and warranties expressly stated to relate to a specific
earlier date, in which case such representations and warranties are true and
correct in all material respects as of such earlier date.

 

b.     No event has occurred and is continuing which constitutes an Event of
Default or a Default.

 

c.     Borrower is in compliance with the covenants set forth in Sections 6 and
7 of the Agreement.

 

d.     The calculations of the financial covenants set forth in Section 7.1 of
the Agreement are set forth in the attached sheets.

 

I hereby certify that the foregoing information to be true and correct in all
material respects and execute this Compliance Certificate this ___ day of
________________.

 

 

CPI AEROSTRUCTURES, INC.

 

By:____________________________

Name:

Title:

 

 
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EXHIBIT G

[Form of Secured Party Designation Notice]

 

Secured Party Designation Notice

            

TO: BankUnited, N.A., as Administrative Agent    

RE:

Amended and Restated Credit Agreement, dated as of March 24, 2016, by and among
CPI Aerostructures, Inc., a New York corporation (the “Borrower”), the Lenders
and BankUnited, N.A., as Sole Arranger, Administrative Agent, Collateral Agent
and Lender (as amended, modified, extended, restated, replaced, or supplemented
from time to time, the “Credit Agreement”; capitalized terms used herein and not
otherwise defined shall have the meanings set forth in the Credit Agreement)

    DATE:  [Date]

          

--------------------------------------------------------------------------------

  

[Name of Cash Management Bank/Swap Provider] (the “Secured Party”) hereby
notifies you, pursuant to the terms of the Credit Agreement, that the Secured
Party meets the requirements of a [Cash Management Bank] [Swap Provider] under
the terms of the Credit Agreement and is a [Cash Management Bank] [Swap
Provider] under the Credit Agreement and the other Loan Documents.

 

Delivery of an executed counterpart of a signature page of this notice by fax
transmission or other electronic mail transmission (e.g. “pdf” or “tif”) shall
be effective as delivery of a manually executed counterpart of this notice.

 

A duly authorized officer of the undersigned has executed this notice as of the
day and year set forth above.

 

 

 

 

,

  as a [Cash Management Bank] [Swap Provider]  

 

 

 

 

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 
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EXHIBIT H-1

 

[Form of]

U.S. Tax Compliance Certificate

 

(For Foreign Lenders That Are Not Partnerships
For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of March 24, 2016, by and among CPI AEROSTRUCTURES, INC., a New York corporation
(the “Borrower”), the Guarantors, the Lenders and BANKUNITED, N.A., as
Administrative Agent, L/C Issuer and Lender (as amended, modified, extended,
restated, replaced, or supplemented from time to time, the “Credit Agreement”).
Pursuant to the provisions of Section 3.12 of the Credit Agreement, the
undersigned hereby certifies that (a) it is the sole record and beneficial owner
of the Loan(s) (as well as any Note(s) evidencing such Loan(s)) in respect of
which it is providing this certificate, (b) it is not a bank within the meaning
of Section 881(c)(3)(A) of the Code, (c) it is not a ten percent shareholder of
the Borrower within the meaning of Section 871(h)(3)(B) of the Code, and (d) it
is not a controlled foreign corporation related to the Borrower as described in
Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with a
certificate of its non-U.S. Person status on IRS Form W-8BEN. By executing this
certificate, the undersigned agrees that (a) if the information provided on this
certificate changes, the undersigned shall promptly so inform the Borrower and
the Administrative Agent, and (b) the undersigned shall have at all times
furnished the Borrower and the Administrative Agent with a properly completed
and currently effective certificate in either the calendar year in which each
payment is to be made to the undersigned, or in either of the two calendar years
preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF FOREIGN LENDER]

 

By: 

 

 

 

 

Name

 

 

 

 

Title

 

 

 

 

          Date: ________ __, ___        

 

 

 
134

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EXHIBIT H-2

 

[Form of]

U.S. Tax Compliance Certificate

 

(For Foreign Participants That Are Not Partnerships

For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of March 24, 2016, by and among CPI AEROSTRUCTURES, INC., a New York corporation
(the “Borrower”), the Guarantors, the Lenders and BANKUNITED, N.A., as
Administrative Agent, L/C Issuer and Lender (as amended, modified, extended,
restated, replaced, or supplemented from time to time, the “Credit Agreement”).
Pursuant to the provisions of Section 3.12 of the Credit Agreement, the
undersigned hereby certifies that (a) it is the sole record and beneficial owner
of the participation in respect of which it is providing this certificate, (b)
it is not a bank within the meaning of Section 881(c)(3)(A) of the Code, (c) it
is not a ten percent shareholder of the Borrower within the meaning of Section
871(h)(3)(B) of the Code, and (d) it is not a controlled foreign corporation
related to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with a certificate of its
non-U.S. Person status on IRS Form W-8BEN. By executing this certificate, the
undersigned agrees that (a) if the information provided on this certificate
changes, the undersigned shall promptly so inform such Lender in writing, and
(b) the undersigned shall have at all times furnished such Lender with a
properly completed and currently effective certificate in either the calendar
year in which each payment is to be made to the undersigned, or in either of the
two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT]

 

By: 

 

 

 

 

Name

 

 

 

Title

 

 

 

 

          Date: ________ __, ___        

 

 

 
135

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EXHIBIT H-3

 

[Form of]

U.S. Tax Compliance Certificate

 

(For Foreign Participants That Are Partnerships

For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of March 24, 2016, by and among CPI AEROSTRUCTURES, INC., a New York corporation
(the “Borrower”), the Guarantors, the Lenders and BANKUNITED, N.A., as
Administrative Agent, L/C Issuer and Lender (as amended, modified, extended,
restated, replaced, or supplemented from time to time, the “Credit Agreement”).
Pursuant to the provisions of Section 3.12 of the Credit Agreement, the
undersigned hereby certifies that (a) it is the sole record owner of the
participation in respect of which it is providing this certificate, (b) its
direct or indirect partners/members are the sole beneficial owners of such
participation, (c) with respect such participation, neither the undersigned nor
any of its direct or indirect partners/members is a bank extending credit
pursuant to a loan agreement entered into in the ordinary course of its trade or
business within the meaning of Section 881(c)(3)(A) of the Code, (d) none of its
direct or indirect partners/members is a ten percent shareholder of the Borrower
within the meaning of Section 871(h)(3)(B) of the Code, and (e) none of its
direct or indirect partners/members is a controlled foreign corporation related
to the Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished its participating Lender with IRS Form W-8IMY
accompanied by one of the following forms from each of its partners/members that
is claiming the portfolio interest exemption: (a) an IRS Form W-8BEN or (b) an
IRS Form W-8IMY accompanied by an IRS Form W-8BEN from each of such
partner's/member's beneficial owners that is claiming the portfolio interest
exemption. By executing this certificate, the undersigned agrees that (i) if the
information provided on this certificate changes, the undersigned shall promptly
so inform such Lender and (ii) the undersigned shall have at all times furnished
such Lender with a properly completed and currently effective certificate in
either the calendar year in which each payment is to be made to the undersigned,
or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF PARTICIPANT]

 

By: 

 

 

 

 

Name

 

 

 

Title

 

 

 

 

          Date: ________ __, ___        

 

 

 
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EXHIBIT H-4

 

[Form of]

U.S. Tax Compliance Certificate

 

(For Foreign Lenders That Are Partnerships

For U.S. Federal Income Tax Purposes)

 

Reference is hereby made to the Amended and Restated Credit Agreement, dated as
of March 24, 2016, by and among CPI AEROSTRUCTURES, INC., a New York corporation
(the “Borrower”), the Guarantors, the Lenders and BANKUNITED, N.A., as
Administrative Agent, L/C Issuer and Lender (as amended, modified, extended,
restated, replaced, or supplemented from time to time, the “Credit Agreement”).
Pursuant to the provisions of Section 3.12 of the Credit Agreement, the
undersigned hereby certifies that (a) it is the sole record owner of the Loan(s)
(as well as any Note(s) evidencing such Loan(s)) in respect of which it is
providing this certificate, (b) its direct or indirect partners/members are the
sole beneficial owners of such Loan(s) (as well as any Note(s) evidencing such
Loan(s)), (c) with respect to the extension of credit pursuant to this Credit
Agreement or any other Loan Document, neither the undersigned nor any of its
direct or indirect partners/members is a bank extending credit pursuant to a
loan agreement entered into in the ordinary course of its trade or business
within the meaning of Section 881(c)(3)(A) of the Code, (d) none of its direct
or indirect partners/members is a ten percent shareholder of the Borrower within
the meaning of Section 871(h)(3)(B) of the Code and (e) none of its direct or
indirect partners/members is a controlled foreign corporation related to the
Borrower as described in Section 881(c)(3)(C) of the Code.

 

The undersigned has furnished the Administrative Agent and the Borrower with IRS
Form W-8IMY accompanied by one of the following forms from each of its
partners/members that is claiming the portfolio interest exemption: (a) an IRS
Form W-8BEN or (b) an IRS Form W-8IMY accompanied by an IRS Form W-8BEN from
each of such partner's/member's beneficial owners that is claiming the portfolio
interest exemption. By executing this certificate, the undersigned agrees that
(i) if the information provided on this certificate changes, the undersigned
shall promptly so inform the Borrower and the Administrative Agent, and (ii) the
undersigned shall have at all times furnished the Borrower and the
Administrative Agent with a properly completed and currently effective
certificate in either the calendar year in which each payment is to be made to
the undersigned, or in either of the two calendar years preceding such payments.

 

Unless otherwise defined herein, terms defined in the Credit Agreement and used
herein shall have the meanings given to them in the Credit Agreement.

 

[NAME OF LENDER]

 

By: 

 

 

 

 

Name

 

 

 

Title

 

 

 

 

          Date: ________ __, ___        

 

 

 
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[ex10-1img002.gif]

EXHIBIT I

[Form of Notice of Borrowing]

 

TRANSACTION REQUEST FORM

To:                   BankUnited, N.A., as Agent

 

Email:              NY-Commloanadmin@BankUnited.com

cc:     MMazzeo@BankUnited.com

cc:     CGerula@BankUnited.com

 

--------------------------------------------------------------------------------

 

Request pursuant to that certain Amended and Restated Credit Agreement (“Credit
Agreement”) dated March 24, 2016 by and among CPI Aerostructures, Inc.
(“Borrower”) and BankUnited, N.A. (the “Bank”).

 

FACILITY TYPE            ☐ REVOLVING CREDIT         ☐TERM LOAN

 

 

NEW ADVANCE

 

Amount to be Borrowed: ___________________ Borrowing Date: ____________________

 

Interest Rate Option:          ☐Base Rate (PRIME)     or     ☐LIBOR Rate

 

If a Eurodollar (LIBOR) Loan, the Interest Period for this Eurodollar Loan shall
be:

 

               ☐One Month      ☐Two Months          ☐Three Months          ☐Six
Months

 

PRINCIPAL PAYMENT

 

Amount of Principal Payment: _____________     Effective Date of Principal
Payment: ______________

 

 

RENEWAL OF EURODOLLAR (LIBOR) LOAN

 

The Renewal Date is: ___________________ Amount of the Eurodollar
Loan:    __________________

 

The Interest Period for this Renewal is:

 

               ☐One Month          ☐Two Months          ☐Three
Months          ☐Six Months

 

CONVERSION 

From Eurodollar Loan to Base Rate Loan:   ______________ Conversion Date:
___________

 

From Base Rate Loan to Eurodollar Loan:   _______________ Conversion Date:
___________

 

If Eurodollar:      ☐One Month          ☐Two Months          ☐Three
Months          ☐Six Months

 

In connection with this Request, Borrower hereby certifies to the Lender that:

 

 

1.

The representation and warranties contained in the Credit Agreement are true and
accurate in all material respects on and as of the date hereof as though made on
and as of such date.

 

 

2.

No Default or Event of Default as defined in the Credit Agreement has occurred
and is continuing, or would result from such Advance.

 

 

 

3.

The Credit Agreement, inclusive of this request are valid and binding
obligations of the Borrower, each enforceable in accordance with its respective
terms.

 

 

Requested By:

CPI Aerostructures, Inc.

 

By: ____________________________                    __________________________

       Name: ______________________                      Date

 

       Title: ______________________

 

138