Exhibit 10.1
 
 
LOAN AGREEMENT
Dated as of
October 21, 2010
AMONG
ASTROTECH SPACE OPERATIONS, INC.
ASTROTECH CORPORATION
ASTROTECH FLORIDA HOLDINGS, INC.
AND
AMERICAN BANK, N.A.
 
 

 

 

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TABLE OF CONTENTS

                              Page   Section 1   General Terms     1  
 
  1.1   Certain Definitions     1  
 
  1.2   Other Documents; Accounting Terms     15  
 
  1.3   Use of Pronouns     16  
 
  1.4   Amendments, Etc.     16   Section 2   The Loans     16  
 
  2.1   Revolving Credit     16  
 
  2.2   Term Loan     17  
 
  2.3   Use of Proceeds     17  
 
  2.4   Default Interest     18  
 
  2.5   Late Charges     18  
 
  2.6   Computations and Manner of Payments     18  
 
                (a) Time and Place     18  
 
                (b) Computation of Interest     18  
 
                (c) Business Day     18  
 
  2.7   Fees     18  
 
  2.8   Accounts Stated     19   Section 3   Representations And Warranties    
19  
 
  3.1   Organization; Good Standing     19  
 
  3.2   Authority, Enforceability     19  
 
  3.3   Corporate Organization     19  
 
  3.4   Financial Condition     20  
 
  3.5   Debt, Liens, Liabilities     20  
 
  3.6   Compliance with Legal Requirements, Agreements, Etc.     20  
 
  3.7   Taxes     20  
 
  3.8   No Leases     21  
 
  3.9   Material Customer Agreements     21  
 
  3.10   Conduct of Business     21  
 
  3.11   Title to Properties     22  
 
  3.12   No Consents Necessary     22  
 
  3.13   ERISA     22  
 
  3.14   Solvency     22  
 
  3.15   No Environmental Hazard     22  
 
  3.16   No Margin Stock     23  
 
  3.17   Patents, Trademarks, Franchises, Licenses, Etc.     24  
 
  3.18   No Pending Litigation     24  
 
  3.19   OFAC     24  
 
  3.20   Investment Company Act     24  
 
  3.21   Securities Acts     24  
 
  3.22   Full Disclosure     25  
 
  3.23   Survival of Representations and Warranties     25  
 
               

 

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                              Page   Section 4   Affirmative Covenants     25  
 
  4.1   Reporting Requirements     25  
 
  4.2   Legal Requirements     26  
 
  4.3   Performance of Obligations; Payment of Debt     26  
 
  4.4   Compliance with Agreements     27  
 
  4.5   Continuity of Senior Management     27  
 
  4.6   Principal Accounts     27  
 
  4.7   Payment of Expenses     27  
 
  4.8   Guaranties, Liens and Security Interest     27  
 
  4.9   Payment of Taxes     28  
 
  4.10   Adequate Records; Inspection Rights     28  
 
  4.11   Maintenance of Existence     29  
 
  4.12   Maintenance of Insurance     29  
 
  4.13   Maintenance of Properties     30  
 
  4.14   Landlord Subordination Agreements     30  
 
  4.15   Indemnity     30  
 
  4.16   Further Assurances     31   Section 5   Negative Covenants     31  
 
  5.1   Financial Covenants     31  
 
  5.2   Debt     31  
 
  5.3   Contingent Liabilities     31  
 
  5.4   Liens     32  
 
  5.5   Distribution/Advances, Restricted Payments and Restricted Purchases    
32  
 
  5.6   Issuance of Borrower’s Capital Stock     32  
 
  5.7   Disposal of Properties     32  
 
  5.8   Tangible Net Worth     32  
 
  5.9   Reorganization, Merger, Etc.     32  
 
  5.10   Transactions with Affiliates     32  
 
  5.11   No Change of Location, Trade Names, Etc.     32  
 
  5.12   Investments     33  
 
  5.13   Prepayments of Other Debt     33  
 
  5.14   No Change in Business     33  
 
  5.15   Fiscal Year     33  
 
  5.16   Margin Stock     33  
 
  5.17   Limitation on Negative Pledge Clauses     34  
 
  5.18   Government Regulation     34   Section 6   General Conditions Of
Borrowing     34  
 
  6.1   Closing Proceedings     34  
 
  6.2   Conditions to Subsequent Advances     36  
 
  6.3   Sole Benefit of Lender     37   Section 7   Events Of Default And
Remedies     37  
 
  7.1   Events     37  
 
  7.2   Remedies     39  
 
  7.3   Cumulative Rights     40  
 
               

 

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                              Page  
 
  7.4   Waivers     40   Section 8   Miscellaneous     40  
 
  8.1   Survival of Various Matters     40  
 
  8.2   Notices     40  
 
  8.3   Control     42  
 
  8.4   Successors and Assigns     42  
 
  8.5   Renewals     42  
 
  8.6   Confidentiality     42  
 
  8.7   No Waiver     43  
 
  8.8   Governing Law     43  
 
  8.9   Non-Subordination     43  
 
  8.10   Exhibits and Schedules     43  
 
  8.11   Payment on Non-Business Days     44  
 
  8.12   Severability     44  
 
  8.13   Savings Clause     44  
 
  8.14   Counterparts     44  
 
  8.15   Limitation of Remedies     45  
 
  8.16   Headings     45  
 
  8.17   No Obligation to Make Advance     45  
 
  8.18   Role of Lender     45  
 
  8.19   Chapter 346 of the Texas Finance Code     46  
 
  8.20   Waiver of Consumer Rights     46  
 
  8.21   NO OTHER AGREEMENTS     46  
 
  8.22   WAIVER OF JURY     47  
 
  8.23   No Duty     47  
 
  8.24   USA Patriot Act Notification     47  

Exhibits

     
Exhibit A —
  Revolving Promissory Note
Exhibit B —
  Term Promissory Note
Exhibit C —
  Borrowing Base Certificate
Exhibit D —
  Compliance Certificate
 
   
Schedules
   
 
   
4.8 —
  Collateral

 

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LOAN AGREEMENT
THIS LOAN AGREEMENT is dated and effective on and as of October 21, 2010, by and
among Astrotech Space Operations, Inc., a Delaware corporation (the “Borrower”),
Astrotech Corporation, a Washington corporation (the “Parent”), Astrotech
Florida Holdings, Inc., a Florida corporation (“Holdings”), and American Bank,
N.A. (the “Lender”).
RECITALS
The Borrower has requested certain loans and financing accommodations from the
Lender. The Lender is willing to make certain loans and extend certain financial
accommodations to the Borrower in reliance upon, and subject to, the
representations, warranties, terms and conditions of this Agreement.
AGREEMENTS
For and in consideration of the mutual covenants and agreements herein
contained, the Lender and the Loan Parties have agreed and do hereby agree as
follows:
SECTION I.
GENERAL TERMS
1.1. Certain Definitions: As used in this Loan Agreement:
“Account” shall mean a right to payment of a monetary obligation, which has been
earned by performance, for property that has been sold, leased, licensed,
assigned, or otherwise disposed of, or for services rendered.
“Affiliate” shall mean with respect to any Person (i) each Person that, directly
or indirectly, owns or controls, whether beneficially, or as a trustee, guardian
or other fiduciary 10% or more of the securities or interests having ordinary
voting power in the election of directors of such Person, (ii) each Person that
controls, is controlled by or is under common control with such Person or any
Affiliate of such Person and (iii) each of such Person’s officers, directors,
joint venturers and partners. For the purpose of this definition “control” of a
Person shall mean the possession, directly or indirectly, of the power to direct
or cause the direction of its management or policies, whether through the
ownership of voting securities, by contract or otherwise. Anything herein to the
contrary notwithstanding, in no event shall the Lender be considered an
“Affiliate” of the Borrower.
“Agreement” shall mean this Loan Agreement, as the same may be modified,
amended, restated or replaced from time to time.
Bankruptcy Code” shall mean Title 11, United States Code, 11 U.S.C. 101 et seq.,
as the same may be amended and in force and effect from time to time, or any
successor law.
“Borrower” shall mean Astrotech Space Operations, Inc., a Delaware corporation,
its successors and assigns.
“Borrower Security Agreement” shall mean a security agreement, in Proper Form,
executed by the Borrower.

 

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“Borrowing Base” shall mean an amount equal to eighty percent (80%) of the
Borrower’s Eligible Accounts, as determined on the dates of determination of the
Borrowing Base.
“Borrowing Base Certificate” shall mean a certificate in the form of Exhibit C
attached hereto to be executed and delivered from time to time by the chief
financial officer or chief executive officer or corporate controller of the
Borrower as required by the provisions of Section 4.1(d) of this Agreement.
“Business Day” shall mean any day, other than a Saturday, Sunday or legal
holiday, on which the Lender is open for the conduct of its business generally.
“Capital Expenditures” shall mean the aggregate amount of all purchases or
acquisitions of items considered to be capital items under GAAP, and in any
event shall include the aggregate amount of items leased or acquired under
Capital Leases at the cost of the item, and the acquisition of realty, tools,
equipment, and fixed assets, and any deferred costs associated with any of the
foregoing (excluding deferred lease payments under Capital Leases).
“Capital Leases” shall mean capital leases and subleases, as defined in the
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 13, dated November 1976, as amended.
“Capital Stock” shall mean, as to any Person, the equity interests in such
Person, including, without limitation, the shares of each class of capital stock
of any Person that is a corporation, membership interests in any Person that is
a limited liability company and partnership and joint venture interests (general
and limited) in any Person that is a partnership or joint venture.
“Capitalized Lease Obligations” shall mean, with respect to any Person, the
amount of the obligations of such Person under Capital Leases which would be
shown as a liability on a balance sheet of such Person prepared in accordance
with GAAP.
“Change of Control” shall mean the occurrence of any of the following:
(a) a transaction in which any “person” or “group” (within the meaning of
Section 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended)
becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended), directly or indirectly, of a sufficient
number of shares of all classes of stock then outstanding of the Parent
ordinarily entitled to vote in the election of directors, empowering such
“person” or “group” to elect a majority of the Board of Directors of the Parent,
who did not have such power before such transaction; or
(b) the Borrower ceases for any reason to be a wholly owned, direct Subsidiary
of the Parent.
“Change of Management” shall mean any change in the position of Persons serving
as an “Executive Officer” (as defined by the Securities and Exchange Commission)
of a Loan Party on the Closing Date.
“Closing Date” shall mean the date of this Agreement or such later date as may
be agreed to in writing by the Lender.

 

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“Code” shall mean the Internal Revenue Code of 1986, as amended, as now or
hereafter in effect, together with all regulations thereof or thereunder by the
Internal Revenue Service.
“Collateral” shall mean the security for payment of the Indebtedness and
performance of the Obligations as contemplated by, and referred to in,
Section 4.8 of this Agreement.
“Collateral Documents” shall mean all security agreements, guaranties,
collateral assignments, pledge agreements, deeds of trust, mortgages and lien
instruments executed by the Borrower, any other Loan Party or others to secure,
guarantee or otherwise provide for payment of the Indebtedness or performance of
the Obligations, in favor of or for the benefit of the Lender, including those
which have been previously executed or are executed concurrently herewith or
subsequently hereto. Without limiting the generality of the foregoing, the term
“Collateral Documents” shall specifically include the Guaranty Agreement, the
Mortgage, the Borrower Security Agreement and the Holdings Security Agreement.
“Compliance Certificate” shall mean a certificate substantially in the form of
Exhibit D attached and to be executed and delivered from time to time as
required by the provisions of Section 4.1(f) hereof and to be signed by an
appropriate Principal Officer of the Borrower demonstrating, in reasonable
detail, compliance with the covenants set forth in Section 5.1 and Section 5.8,
and containing a statement whether to the Knowledge of such officer an Event of
Default or Default has occurred hereunder and, if so, whether it is continuing
and specifying the steps that are being taken by the Borrower to cure the same.
“Contingent Liability” shall mean, as to any Person, any Guaranty, and any
obligation, contingent or otherwise, of such Person guaranteeing or having the
economic effect of guaranteeing any Debt or obligation of any other Person in
any manner, whether directly or indirectly, including without limitation any
obligation of such Person, direct or indirect, (a) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Debt or to purchase
(or to advance or supply funds for the purchase of) any security for the payment
of such Debt, (b) to purchase Property or services for the purpose of assuring
the owner of such Debt of its payment, or (c) to maintain the solvency, working
capital, equity, cash flow, fixed charge or other coverage ratio, or any other
financial condition of the primary obligor so as to enable the primary obligor
to pay any Debt or to comply with any agreement relating to any Debt or
obligation.
“Controlled Group” shall mean all members of a controlled group of corporations
and all trades or businesses (whether or not incorporated) under common control
which, together with the applicable Person, are treated as a single employer
under Section 414 of the Code.
“Debt” shall mean, as to any Person, (a) all obligations of such Person for
borrowed money; (b) the maximum amount of all direct or contingent obligations
of such Person arising under letters of credit, bankers’ acceptances, bank
guaranties, surety bonds and similar instruments; (c) net obligations of such
Person under any Rate Protection Agreement; (d) all obligations of such Person
to pay the deferred purchase price of property or services (other than trade
accounts payable in the ordinary course of business and not past due for more
than 60 days after the date on which such trade account was created); (e) all
indebtedness

 

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secured by any lien upon Property owned by such Person, even though such Person
has not assumed or become liable for the payment of such indebtedness; (f) all
indebtedness of such Person created or arising under any conditional sale or
other title retention agreement with respect to Property acquired by such
Person, even though the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession or sale of such
Property and (g) all Capitalized Lease Obligations. For all purposes of this
Agreement, the Debt of any Person shall include all recourse Debt of any
partnership and joint venture in which such Person is a general partner or a
joint venturer.
“Debt Service Coverage Ratio (After Distributions/Advances)” shall mean, as to
any Person, the quotient derived on any date of determination by dividing such
Person’s EBITDA, minus its Non-Financed Capex and minus Distribution/Advances
(excluding Distribution/Advances from Holdings to Borrower), by its required
payments of principal and interest on Debt (excluding any such payments to the
extent refinanced through the incurrence of Debt as permitted by Section 5.2),
determined on a trailing twelve month basis; provided, however, that the onetime
distribution by the Borrower to the Parent of proceeds of the Term Loan to
replenish funds used by the Parent to pay in full the Senior Convertible Notes
shall not be deducted from EBITDA for purposes of calculating the Borrower’s
Debt Service Coverage Ratio (After Distributions/Advances).
“Default” shall mean any occurrence which, but for the passage of time or giving
of notice or both, or the happening of any further condition, event or act,
would be an Event of Default.
“Default Rate” shall mean, during the continuance of an Event of Default, other
than the failure to pay any amount of principal or interest on a Note when due,
a rate per annum equal to the lesser of (a) five percent (5.00%) per annum in
excess of the rate that would otherwise be applicable on the respective Loan
during such time, and (b) the Maximum Lawful Rate, and during the continuance of
any failure to pay any amount of principal or interest on a Note when due, a
rate per annum equal to the Maximum Lawful Rate.
“Distribution/Advance” shall mean, as to any Person, (a) any declaration or
payment of any dividend on, or the setting aside or the creation of a sinking
fund with respect to, or the making of any distribution, loan, advance or
investment to or in any holder (in its capacity as a holder) of, any Capital
Stock of such Person (other than a dividend in, or distribution of, Capital
Stock of the same class and series or the right to acquire Capital Stock of the
same class and series), or (b) any purchase, redemption or other acquisition or
retirement for value of any Capital Stock of such Person, or the setting aside
of funds or the creation of a sinking fund with respect thereto.
“EBITDA” shall mean, as to Borrower and Holdings on a consolidated basis for any
period, the sum, without duplication, for such period, of (a) Net Income during
such period, plus (b) Interest Expense during such period, plus (c) the amount
properly deducted, in determining Net Income, of all income and franchise taxes
(whether paid or deferred) of such Person during such period, plus (d) the
amount properly deducted, in determining Net Income, representing amortization
and depreciation of assets of such Person during such period.

 

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“Eligible Accounts” shall mean the gross outstanding balance of the Borrower’s
Accounts that are due and payable in thirty (30) days and that the Lender, in
its sole discretion, shall deem eligible, and less (i) such reserves as the
Lender, in its sole discretion, shall deem appropriate, (ii) all finance
charges, late fees and other fees that are unearned, and (iii) all discounts,
allowances, rebates, credits and adjustments. Without in any way limiting the
discretion of the Lender to deem an Account eligible or ineligible, the Lender
does not currently intend to treat an Account as eligible if:
(a) any warranty or representation contained in this Agreement or any of the
Collateral Documents applicable either to Accounts in general or to any such
specific Account has been breached with respect to such Account;
(b) all or any part thereof has remained unpaid for more than ninety (90) days
after the original invoice date;
(c) 25% or more of the outstanding Accounts from the Account debtor have
remained unpaid for more than ninety (90) days after the original invoice date;
(d) the Account is owed by an Account debtor who owes 50% or more of all
Accounts in the aggregate (in which case, the amount exceeding 50% shall be
treated as ineligible);
(e) the Account includes an amount billed for or representing retainage (in
which case, the amount of retainage shall be ineligible until all prerequisites
to its immediate payment have been satisfied);
(f) the Account debtor has filed a petition for relief under the Bankruptcy Code
(or similar action under any successor law or any state law now or hereafter
existing for the relief of debtors), made a general assignment for the benefit
of creditors, had filed against it any petition or other application for relief
under the Bankruptcy Code (or similar action under any successor law or any
state law now or hereafter existing for the relief of debtors), failed,
suspended business operations, become insolvent, called a meeting of its
creditors for the purpose of obtaining any financial concession or
accommodation, or had or suffered a receiver or a trustee to be appointed for
all or a significant portion of its assets or affairs;
(g) Accounts denominated in other than United States Dollars or payable outside
the United States or payable by an Account debtor whose principal place of
business is located outside the United States, except to the extent (1) covered
by either Foreign Receivable Insurance or a letter of credit acceptable to the
Lender and which has been assigned to the Lender by an assignment in Proper
Form, or (2) approved by the Lender;
(h) the Account is subject to any offset, claim or dispute by the Account debtor
(in which case, the amount of the Account equal to the amount of such offset,
claim or dispute shall be ineligible);

 

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(i) the Account is subject to consignment, sale or return, guaranteed sale or
bill and hold;
(j) the Account is subject to any Liens, other than Liens in favor of the
Lender;
(k) the Account is an account of the United States government, the government of
any state of the United States or any political subdivision thereof, or any
department, agency or instrumentality of any of the foregoing and the Lender has
not perfected a first priority security interest in such Account (including, by
way of illustration, but not in limitation, perfection under the Federal
Assignment of Claims Act);
(l) the Account debtor is an Affiliate or employee of the Borrower;
(m) the Account is not evidenced by an invoice or other writing in Proper Form;
(n) the Borrower, in order to be entitled to collect the Account, is required to
perform any additional service for, or perform or incur any additional
obligation to, the Account debtor; or
(o) the Account is subject to any provision prohibiting assignment or requiring
notice of or consent to such assignment and (1) such prohibition has not been
waived in writing or such notice, or (2) consent has not been given or obtained,
or (3) such provision is unenforceable as to the right to grant a security
interest to the Lender under provisions of the Uniform Commercial Code
applicable to such Account.
“Environmental Laws” shall mean any applicable judgment, decree, code, order,
law, rule of common law, license, rule or regulation pertaining to environmental
matters, including without limitation, those arising under the Resource
Conservation and Recovery Act (“RCRA”), the Comprehensive Environmental
Response, Compensation and Liability Act of 1980 as amended (“CERCLA”), the
Superfund Amendments and Reauthorization Act of 1986 (“SARA”), the Federal Clean
Water Act, the Federal Clean Air Act, the Toxic Substances Control Act, or any
applicable state or local statute, regulation, ordinance, order or decree
relating to the environment, and broadly including any and all present and
future federal, state, local and foreign laws, rules or regulations, and any
orders or decrees, in each case as now or hereafter in effect, relating to the
regulation or protection of human health, safety or the environment or to
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or toxic or hazardous substances or wastes into the
indoor or outdoor environment, including, without limitation, ambient air, soil,
surface water, ground water, wetlands, land or subsurface strata, or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport or handling of pollutants, contaminants, chemicals or toxic
or hazardous substances or wastes.
“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as
amended, including any rules or regulations from time to time promulgated
thereunder.

 

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“Event of Default” shall mean any of the events specified or referred to in
Section 7.1 of this Agreement with respect to which any requirement in
connection with such event for the giving of notice, or the lapse of time, or
the happening of any further condition, event or act, has been satisfied.
“Foreign Receivable Insurance” shall mean insurance issued by either the
Export-Import Bank of the United States or the Foreign Credit Insurance agency
or other financially sound and reputable insurance companies indemnifying the
Borrower for the insured percentage of a loss in excess of any applicable
deductible arising out of a default with respect to the contract price of an
insured transaction with a party outside the United States.
“GAAP” shall mean, as to a particular Person and subject to the provisions of
Section 1.2, such accounting practice as, in the opinion of the independent
accountants of recognized standing regularly retained by such Person and
acceptable to the Lender, conforms at the time to generally accepted accounting
principles, consistently applied. Generally accepted accounting principles means
those principles and practices (a) which are recognized as such by the Financial
Accounting Standards Board, (b) which are applied for all periods after the date
hereof in a manner consistent with the manner in which such principles and
practices were applied to the most recent audited financial statements of the
Person furnished to the Lender, and (c) which are consistently applied for all
periods after the date hereof so as to reflect properly the financial condition,
and results of operations and changes in financial position, of such Person.
“Governmental Authority” shall mean any governmental authority, including that
of the United States of America, any State of the United States, any foreign
country, and any political subdivision of any of the foregoing, including the
City of Austin, Texas, and any domestic or foreign agency, department,
commission, board, bureau or court having jurisdiction over the Lender, the
Borrower, any Guarantor, or Property of any of the foregoing.
“Green Bank Financing” shall mean the credit facilities made available to the
Borrower by Green Bank, N.A. pursuant to the provisions of that certain Loan
Agreement dated as of February 6, 2008 between the Borrower and such bank, as
the same has been amended from time to time.
“Guaranty” shall mean, as to a Person, any agreement by which such Person
assumes, guarantees, endorses, contingently agrees to purchase or provide funds
for the payment of, or otherwise becomes liable upon, the obligation of any
other Person, or agrees to maintain the net worth or working capital or other
financial condition of any other Person, or otherwise assures any creditor or
such other Person against loss, including, without limitation, any agreement
which assures any creditor or such other Person payment or performance of any
obligation, or any take-or-pay contract and shall include without limitation,
the contingent liability of such Person in connection with any application for a
letter of credit (without duplication of any amount already included in Debt).
“Guaranty Agreement” shall mean an agreement, in Proper Form, executed by the
Guarantors pursuant to which they guarantee the payment of the Indebtedness and
the performance of the Obligations.

 

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“Guarantors” shall mean, collectively, Holdings and the Parent.
“Hazardous Material” shall mean, collectively, (a) any petroleum or petroleum
products, flammable explosives, radioactive materials, asbestos in any form that
is or could become friable, insulation, transformers or other equipment that in
each case contains dielectric fluid containing polychlorinated biphenyls,
(b) any chemicals or other material or substances which are now or hereafter
become defined as or included in the definition of “hazardous substances”,
“hazardous wastes”, “restricted hazardous wastes”, “toxic substances”, “toxic
pollutants”, recontaminants”, “pollutants” or words of similar import under any
Environmental Laws and (c) any other chemical or other material or substance,
exposure to which is now or hereafter prohibited, limited or regulated under any
Environmental Laws.
“Hedging Obligations” shall mean, with respect to any Person, all liabilities of
such Person under any Rate Protection Agreement.
“herein,” “hereof,” “hereto,” “hereunder” and similar terms, shall refer to this
Agreement and not to any particular section or provision of this Agreement.
“Holdings” shall mean Astrotech Florida Holdings, Inc., a Florida corporation,
and its successors and assigns.
“Holdings Security Agreement” shall mean a security agreement, in Proper Form,
executed by Holdings.
“Impermissible Qualification” shall mean, relative to the opinion or
certification of any independent public accountant as to any financial statement
of any Person, any qualification or exception to such opinion or certification
(a) which is of a “going concern” or similar nature; (b) which relates to the
limited scope of examination or matters relevant to such financial statement not
in accordance with GAAP; or (c) which relates to the treatment or classification
of any item in such financial statement and which, as a condition to its
removal, would require an adjustment to such item the effect of which would be
to cause a Default or Event of Default.
“Indebtedness” shall mean all sums at any time and from time to time owed by the
Borrower to the Lender under this Agreement, including principal and interest on
the Notes, and any and all other indebtedness now or hereafter to become owing
pursuant to any of the other Loan Documents.
“Indemnified Matters” shall have the meaning given such term in Section 4.15(a).
“Indemnitees” shall have the meaning given such term in Section 4.15(a).
“Interest Expense” shall mean, for any period, the aggregate consolidated
interest expense of a Person for such period, as determined in accordance with
GAAP, including, without duplication, the portion of any Capitalized Lease
Obligations allocable to interest expense, all commissions, discounts and other
fees charged with respect to letters of credit and bankers’ acceptance
financing, the amortization of debt discounts and the net costs under Rate
Protection Agreements, in each case paid or payable during such period.
“Late Charge” shall mean the late charge that is described in Section 2.5
hereof.

 

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“Legal Requirement” shall mean any law, statute, ordinance, decree, requirement,
order, judgment, rule, or regulation (or interpretation of any of the foregoing)
of, and the terms of any license or permit issued by, any Governmental
Authority. Without limiting the generality of the foregoing, the term “Legal
Requirement” shall specifically include the Export Administration Act of 1979,
the Arms Control Act, The Foreign Corrupt Practices Act, the Iran
Nonproliferation Act of 2000, The Truth in Negotiations Act and the Federal
Acquisition Regulations.
“Lender” shall mean American Bank, N.A. and its successors and assigns.
“Leverage Ratio” shall mean, as of any date of determination, the ratio of the
Borrower’s Total Debt to its Tangible Net Worth determined for Borrower and
Holdings on a consolidated basis.
“Liabilities” shall mean all Debt and other items of indebtedness or liability
(except capital and surplus, but including reserves other than those deducted in
determining Tangible Assets) which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance sheet.
“Liens” shall mean any mortgage, pledge, security interest, encumbrance, lien,
or charge of any kind, including without limitation any agreement to give any of
the foregoing, any conditional sale or other title retention agreement, any
lease in the nature thereof, and the filing of or agreement to give any
financing statement or other similar form of public notice under the laws of any
jurisdiction (except for the filing of a financing statement or notice in
connection with an operating lease).
“Litigation” shall mean any proceeding, claim, lawsuit, arbitration, and
investigation conducted or threatened by or before any Governmental Authority,
including without limitation proceedings, claims, lawsuits, and investigations
under or pursuant to any environmental, occupational, safety and health,
antitrust, unfair competition, securities, Tax, or other law, or under or
pursuant to any contract, agreement, or other instrument.
“Loan Documents” shall mean this Agreement, the Notes, the Collateral Documents,
and all other documents, financing statements, agreements, and certificates
executed and delivered by any Person in connection with any thereof.
“Loan Parties” shall mean, collectively, the Borrower, the Parent and Holdings,
and “Loan Party” shall mean, individually, any one of the Borrower, the Parent
or Holdings.
“Loan Party’s Knowledge, Borrower’s Knowledge or Knowledge” shall mean the
actual knowledge of any Principal Officer of any Loan Party, after having
conducted a reasonable investigation and inquiry thereof.
“Loans” shall mean the loans referred to in Section 2.1 and Section 2.2 of this
Agreement.
“Material Adverse Effect” means a material adverse effect on any of (i) the
operations, business, assets, properties, condition (financial or otherwise) or
prospects of any of the Loan Parties, (ii) the ability of any Loan Party to
perform any of its obligations under any Loan Document to which it is a party,
(iii) the legality, validity or enforceability of this Agreement or any other
Loan Document, (iv) the rights and remedies of the Lender under any Loan
Document, or (v) the validity, perfection or priority of a Lien in favor of the
Lender on any of the Collateral.

 

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“Material Customer Agreement” shall mean each agreement between the Borrower and
one or more of its customers which is now in effect and each such agreement that
is hereafter entered into and which, in each such case, gives rise to, or may
give rise to, an Account and which can reasonably be expected to provide for
aggregate payments to the Borrower over the life of the agreement in the
aggregate amount of $1,000,000.00 or more.
“Maximum Lawful Rate” shall mean the maximum rate of nonusurious interest
permitted with respect to the indebtedness evidenced by the Notes from time to
time by applicable law after taking into account any and all fees, payments, and
other charges that constitute interest under applicable law. Unless changed in
accordance with applicable law, the applicable rate ceiling under Texas law
shall be the weekly ceiling in effect from time to time, as provided in
Chapter 303 of the Texas Finance Code (as amended) , subject to the provisions
of Section 303.009 of the Texas Finance Code ( as amended).
“Mortgage” shall mean a Mortgage upon the Titusville Facility, in proper Form,
executed by Holdings.
“Net Income” shall mean, for any period, all amounts (exclusive of all amounts
in respect of any extraordinary gains or losses, the net mark-to-market of any
Hedging Obligation, non-cash impairments of long-lived assets, intangible assets
and goodwill) which, in accordance with GAAP, would be included as net income or
net loss on the consolidated statements of income of the Borrower and its
Subsidiaries at such time; provided, however, that there shall be excluded from
Net Income (a) the income of any Person in which any other Person has a joint
interest (other than a Subsidiary) or in which there is any restriction in the
payment of such income to the Borrower or any of its Subsidiaries, except to the
extent of the amount of dividends or other distributions that were actually paid
in cash to the Borrower or any of its Subsidiaries by such Person during such
period; (b) the net income or net loss of any Person prior to the date it became
a Subsidiary of, or was merged or consolidated into, the Borrower or any of its
Subsidiaries; or (c) the undistributed earnings of any Subsidiary of the
Borrower to the extent that the declaration or payment of such dividends or
distributions by such Subsidiary is not at the time permitted by the terms of
any contractual obligation or Legal Requirement applicable to such Subsidiary.
“Non-Financed Capex” shall mean Capital Expenditures not financed by Debt.
“Notes” shall mean the promissory notes evidencing the Loans and delivered or to
be delivered to the Lender by the Borrower pursuant to this Agreement, together
with any and all renewals, extensions, modifications and rearrangements thereof.
“Obligations” shall mean any and all of the covenants, conditions, warranties,
representations and other obligations (other than to repay the Indebtedness)
made or undertaken by the Borrower as set forth in this Agreement, the Notes and
any other Loan Documents.
“Origination Fee” shall mean the fee to be paid by the Borrower to the Lender in
accordance with the provisions of Section 2.7 of this Agreement.

 

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“Parent” shall mean Astrotech Corporation, a Washington corporation, its
successors and assigns.
“PBGC” shall mean the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.
“Permitted Debt” shall mean:
(a) any Debt owing to the Lender under this Agreement and the other Loan
Documents;
(b) any other Debt listed on Schedule 3.5 (with the exception of Debt that is to
be repaid in full pursuant to the provisions of Section 2.3 hereof), and the
extension of maturity, refinancing or modification of the terms thereof;
provided, however, that (i) such extension, refinancing or modification is
pursuant to terms that are not less favorable to the Borrower or Holdings than
the terms of the Debt being extended, refinanced or modified and (ii) after
giving effect to such extension, refinancing or modification, the amount of such
Debt is not greater than the amount of Debt outstanding immediately prior to
such extension, refinancing or modification;
(c) Debt consisting of installment payments of insurance premiums obtained in
the ordinary course of business on a current basis;
(d) Subordinated Debt not exceeding the aggregate principal amount of
$500,000.00 outstanding at any given time; and
(e) Debt in respect of Capital Leases and purchase money obligations not to
exceed the aggregate principal amount of $75,000 outstanding at any given time.
“Permitted Liens” shall mean:
(a) Liens arising under worker’s compensation laws, unemployment insurance laws
and old age pensions or other social security benefits or other similar laws;
(b) Liens securing the performance of bids, tenders, leases, contracts (other
than for the repayment of any Debt), statutory obligations, surety and appeal
bonds, and other obligations of like nature, incurred in the ordinary course of
business;
(c) Liens imposed by law, such as carriers’, warehousemen’s mechanics’,
materialmen’s and vendors’ liens, incurred in good faith in the ordinary course
of business with respect to obligations not then delinquent by more than 60 days
and with respect to which no enforcement action has been commenced, or that are
being contested in good faith by appropriate proceedings for which adequate
reserves have been established;
(d) Liens for Taxes to the extent nonpayment thereof shall be permitted by
Section 4.9 hereof;

 

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(e) Liens incidental to the normal conduct of the business of a Loan Party or
the ownership of its Property (including zoning restrictions, easements,
licenses, reservations, restrictions on the use of real Property or minor
irregularities incident thereto and with respect to leasehold interests, Liens
that are incurred, created, assumed or permitted to exist and arise by, through
or under or are asserted by a landlord or owner of the leased Property, with or
without consent of the lessee) that are not incurred in connection with the
incurrence of any Debt and which do not in the aggregate materially impair the
value or use of the Property used in the business of a Loan Party, or the use of
such Property for the purpose for which such Property is held;
(f) Liens existing on the date hereof described on Schedule 3.5 attached hereto;
provided that such Lien secures only those obligations which it secures on the
Closing Date, and any extension, refinancing or modification thereof which is
Permitted Debt pursuant to subparagraph (b) of the definition of Permitted Debt
and such Lien does not extend to or cover any Collateral;
(g) Liens securing the payment of the Indebtedness and performance of the
Obligations;
(h) judgment Liens in respect of judgments that do not constitute an Event of
Default under Section 7.1(l) hereof;
(i) Liens arising from filing UCC financing statements with respect to operating
leases the existence of which do not result in an Event of Default;
(j) leases or subleases entered into in the ordinary conduct of business;
(k) statutory and common law landlords’ liens under leases to which the Borrower
or Holdings is a party and which are not required to be waived or subordinated
by the terms of this Agreement;
(l) customary Liens (including the right of set-off) in favor of banking
institutions encumbering deposits held by such banking institutions incurred in
the ordinary course of business;
(m) licenses and sublicenses of patents, trademarks, copyrights or other
intellectual property rights granted in the ordinary course of business;
(n) any Lien existing on any fixed or capital asset prior to the acquisition
thereof by the Borrower or any of its Subsidiaries; provided that (i) such Lien
is not created in contemplation of or in connection with such acquisition,
(ii) such Lien shall not apply to any other asset of the Borrower or any of its
Subsidiaries not acquired together with such fixed or capital asset and
(iii) such Lien shall secure only those obligations which it secures on the date
of such acquisition or the date such Person becomes a Subsidiary, as the case
may be and extensions, renewals and replacements thereof that do not increase
the outstanding principal amount thereof;

 

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(o) Liens (including Liens arising under conditional sale, title retention or
similar arrangements) on fixed or capital assets acquired, constructed or
improved by the Borrower or any of its Subsidiaries; provided, that (i) such
Liens secure Debt permitted by clause (e) of the definition of Permitted Debt,
(ii) such security interests and the Debt secured thereby are incurred prior to
or within 90 days after such acquisition or the completion of such construction
or improvement, (iii) the Indebtedness secured thereby does not exceed 100% of
the cost of acquiring, constructing or improving such fixed or capital assets
and (iv) such security interests shall not apply to any other property or assets
of the Parent or any of its Subsidiaries other than fixed or capital assets
acquired, constructed or improved in connection therewith;
(p) with respect to the Titusville Facility, encumbrances thereon reflected as
exceptions to title in the mortgage title insurance policy (or binding
commitment) relating to such parcel and approved by the Lender;
(q) Liens securing Subordinated Debt on assets other than Collateral; and
(r) Liens with respect to Capital Leases permitted by clause (e) of the
definition of Permitted Debt.
“Person” shall mean any individual, partnership, joint venture, corporation,
limited liability company, trust, unincorporated association, Governmental
Authority or any other form of entity.
“Plan” shall mean an employee pension benefit plan which is covered by Title IV
of ERISA or subject to the minimum funding standards under Section 412 of the
Code and is either (a) maintained by the Borrower or any member of a Controlled
Group for employees of the Borrower or (b) maintained pursuant to a collective
bargaining agreement or any other arrangement under which more than one employer
makes contributions and to which the Borrower or any member of a Controlled
Group for employees of the Borrower is then making or accruing an obligation to
make contributions or has within the preceding five plan years made
contributions.
“Principal Officer” shall mean the chief executive officer, chief financial
officer, general counsel, president or any vice-president of a Loan Party.
“Prior Financial Statements” shall mean the financial statements described in
Section 3.4 hereof.
“Proper Form” shall mean such form as is satisfactory in form and substance to
the Lender.
“Property” shall mean all types of real, personal, tangible, intangible, or
mixed property, whether owned in fee simple or leased.
“Rate Protection Agreement” shall mean any interest rate cap agreement, interest
rate collar agreement or similar arrangement designed to protect a Person
against fluctuations in interest rates.
“Release” shall have the meaning given such term in Section 3.15.
“Restricted Payments” shall mean any Distribution/Advance or any direct or
indirect distribution, dividend or other payment on account of any general or
limited partnership interest in (or the setting aside of funds for, or the
establishment of a sinking fund or analogous fund with respect to), or shares of
Capital Stock or other securities of, a Person or any of its Subsidiaries.

 

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“Restricted Purchases” shall mean any payments (or the setting aside of funds
for, or the establishment of a sinking fund with respect to) on account of the
purchase, redemption or other acquisition or retirement of any general or
limited partnership interest in, or shares of Capital Stock or other securities
of, a Person or any of its Subsidiaries.
“Revolving Credit” shall mean the short term, revolving credit available to the
Borrower under this Agreement, as referred to in Section 2.1 below.
“Revolving Credit Limit” shall mean the principal amount of Three Million and
00/100 Dollars ($3,000,000.00).
“Revolving Credit Maturity Date” shall mean October 21, 2012.
“Senior Convertible Notes” shall mean Astrotech Corporation (Parent) notes
bearing interest of 5.5% annually, which are due on October 15, 2010.
“Subordinated Debt” shall mean any debt owing or to become owing by the Borrower
or the Parent, the payment of which and the Liens securing which are
subordinated in all respects to the payment of the Indebtedness and any other
Debt now or hereafter to become owing by the Borrower to the Lender and to the
performance of the Obligations, pursuant to the provisions of a Subordination
Agreement in Proper Form to which the Parent, the Borrower, the Lender and the
Person to whom the Debt is owing are parties.
“Subordination Agreement” shall mean a written agreement in Proper Form to which
the Lender is a party and which evidences the terms of subordination of
Subordinated Debt.
“Subsidiary” shall mean, with respect to any Person, any corporation,
partnership, joint venture, limited liability company, association or other
entity the accounts of which would be consolidated with those of the parent in
the parent’s consolidated financial statements if such financial statements were
prepared in accordance with GAAP as of such date, as well as any other
corporation, partnership, joint venture, limited liability company, association
or other entity (i) of which securities or other ownership interests
representing more than 50% of the equity or more than 50% of the ordinary voting
power, or in the case of a partnership, more than 50% of the general partnership
interests are, as of such date, owned, controlled or held, or (ii) that is, as
of such date, otherwise controlled, by the parent or one or more subsidiaries of
the parent or by the parent and one or more subsidiaries of the parent.
“Tangible Assets” shall mean, as to any Person, the total of all assets of such
Person, as determined in accordance with GAAP, less the sum of the following:
(a) All intangibles such as goodwill, trademarks, trade names, franchises,
goodwill, copyrights, patents, licenses and rights in any thereof;
(b) Unamortized discounts and expenses;
(c) Reserves not deducted for accounting purposes from the related assets;
(d) All capitalized future tax benefits;
(e) Assets located, and notes and receivables due from obligors domiciled,
outside of the United States of America; and

 

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(f) All other assets as are properly classified as intangible assets in
accordance with GAAP.
“Tangible Net Worth” shall mean, as to any Person, the amount arrived at by
subtracting the sum of such Person’s total Liabilities from its Tangible Assets
and adding its Subordinated Debt.
“Taxes” shall mean all taxes, assessments, imposts, fees, and other charges at
any time imposed by any laws or Governmental Authority.
“Term Loan” shall mean the term loan available to the Borrower under this
Agreement, as referred to in Section 2.2 below.
“Term Loan Amount” shall mean Seven Million and 00/100 Dollars ($7,000,000.00).
“Term Loan Maturity Date” shall mean October 21, 2015.
“Term Note” shall mean the promissory notes evidencing the Term Loan and
delivered or to be delivered to the Lender by the Borrower pursuant to this
Agreement.
“Titusville Facility” shall mean, collectively, all those parcels of land owned
by Holdings in Sections 3 and 4, Township 23 South, Range 35 East, in the City
of Titusville, Brevard County, Florida, together with all improvements,
facilities and amenities located thereon.
“Total Debt” shall mean, as to Borrower and Holdings on a consolidated basis,
without duplication, with respect to such Person and its Subsidiaries, the sum
of (a) all indebtedness for borrowed money, plus (b) all indebtedness subject to
any Guaranty of such Person or any Subsidiary, plus (c) Capitalized Lease
Obligations, plus (d) accrued and unpaid management fees payable by such Person,
plus (e) Debt associated with interest rate swap agreements with other Persons,
all calculated in accordance with GAAP.
“Unfunded Liabilities” shall mean, with respect to any Plan, at any time, the
amount (if any) by which (a) the present value of all benefit liabilities under
such Plan exceeds (b) the fair market value of all Plan assets allocable to such
benefit liabilities, all determined as of the then most recent actuarial
valuation report for such Plan, but only to the extent that such excess
represents a potential liability of any member of the applicable Controlled
Group to the PBGC or a Plan under Title IV of ERISA.
“Unused Fee” shall have the meaning given such term in Section 2.7(c) hereof.
“VAFB Facility” shall mean the 60 acre site located on Vandenburg Air Force Base
in California and currently operated by the Borrower.
“VAFB Lease” shall mean the lease by which the Borrower leases the VAFB Facility
and currently being.
“Working Capital” shall mean, as to any Person, such Person’s Current Assets
less its Current Liabilities as determined in accordance with GAAP.

 

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1.2. Other Documents; Accounting Terms. All terms defined in this Agreement
shall be used with such defined meanings when used in any note, certificate,
schedule, report or other document made or delivered pursuant to this Agreement,
unless specifically required otherwise. Each accounting term not specifically
defined herein shall have the meaning given in accordance with GAAP and, when
applied to a Person, shall mean such Person and its Subsidiaries on a
consolidated basis, unless otherwise expressly stated. If any change in any
accounting principle or practice is required by the Financial Accounting
Standards Board in order for such principle or practice to continue as a
generally accepted accounting principal or practice and such change results in a
change in the method of calculation of financial covenants, standards or terms
in this Agreement, then the Loan Parties and the Lender agree to enter into
negotiations in order to amend such provisions of this Agreement so as to
equitably reflect such change with the desired result being that the criteria
for evaluating the financial condition of the Loan Parties shall be the same
after such change as if such change had not been made. Until such time as such
an amendment shall have been executed and delivered by the Loan Parties and the
Lender, all financial covenants, standards and terms in this Agreement shall
continue to be calculated as if such change had not occurred.
1.3. Use of Pronouns. Terms defined or used in the singular shall include the
plural, and those in the plural shall include the singular, unless the context
shall otherwise require, and the use of masculine, feminine and neuter pronouns
shall include each gender as the context may require.
1.4. Amendments, Etc. Unless the context otherwise requires or unless otherwise
provided, the terms defined in Section 1.1 hereof which mean or refer to a
particular agreement, instrument or document shall also mean, refer to and
include when appropriate all amendments, renewals, extensions, substitutions and
modifications of such agreement, instrument or document, provided that nothing
contained in this Section 1.4 shall be construed to authorize the execution or
entering into by any Person of any such renewal, extension or modification
except as may be permitted by other provisions of this Agreement.
SECTION II.
The Loans
2.1. Revolving Credit.
(a) Upon and subject to the terms and conditions of this Agreement, and until
the Revolving Credit Maturity Date, the Lender agrees to advance loans to the
Borrower from time to time, for the purposes specified in Section 2.3(a) of this
Agreement on a short term, revolving basis so that the Borrower may borrow,
repay and reborrow in amounts such that the aggregate principal amount
outstanding under the Revolving Credit hereunder shall not, at any one time,
exceed the lesser of (i) the Revolving Credit Limit or (ii) the Borrowing Base.
(b) The Lender’s agreement and obligation to advance funds under the Revolving
Credit shall be subject to the continued satisfaction of each of the general
conditions of borrowing under this Agreement as set out in Section VI below, and
to the following additional condition:

 

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At least one (1) Business Days prior to the making of such advance Borrower
shall have delivered to the Lender, to the attention of Loan Operations, a
written request for such loan, specifying the amount of the requested loan
advance, the date the advance is requested to be made, and the purpose of the
advance and such request shall be included in a Borrowing Base Certificate,
prepared as of the date of the draw request. Further, as a condition precedent
to the obligation of the Lender to make any such advance, the Borrower shall
furnish to the Lender such schedules, certificates, and other documents as the
Lender may reasonably require to satisfy itself with respect to the proper use
of the proceeds of the Revolving Credit as provided in Section 2.3(a) of this
Agreement. If all conditions to such advance have been satisfied, the Lender
shall make such advance within one (1) Business Days after receipt of the
written request. Any such written request received on or after 11:00 a.m.,
Austin time, shall be deemed to have been received the next Business Day.
(c) The obligation of the Borrower to repay the advances made under the
Revolving Credit shall be evidenced by a Revolving Note of the Borrower, in the
form of Exhibit A attached hereto with appropriate insertions. The Borrower
shall pay immediately without demand or notice the principal amount outstanding
at any time under the Revolving Credit to the extent such principal amount
exceeds the lesser of (i) the Revolving Credit Limit or (ii) the Borrowing Base.
The Revolving Note shall be payable in full on the Revolving Credit Maturity
Date.
2.2. Term Loan.
(a) Upon and subject to the terms and conditions of this Agreement, the Lender
agrees to advance a loan to the Borrower in a single advance on the Closing Date
for the purpose specified in Section 2.3(b) of this Agreement in the amount of
the Term Loan Amount.
(b) The obligation of the Borrower to repay the loan advanced under the Term
Loan shall be evidenced by a Term Note of the Borrower, in the form of Exhibit B
attached hereto with appropriate insertions. The Term Note shall be payable in
full on the Term Loan Maturity Date.
2.3. Use of Proceeds.
(a) The proceeds of each loan requested by the Borrower and advanced by the
Lender under the Revolving Credit shall be used by the Borrower first to repay
in full all amounts owing on the Closing Date under the revolving credit portion
of the Green Bank Financing and thereafter solely for working capital and
general corporate purposes.
(b) The proceeds of the Term Loan shall be used solely (i) to repay in full all
amounts owing on the Closing Date on the term loan portion of the Green Bank
Financing, and (ii) to make a Distribution/Advance by the Borrower to the Parent
to replenish funds used by the Parent solely to pay in full all amounts owing on
the Senior Convertible Notes.
(c) Each loan request by the Borrower for an advance under either of the Notes
shall be deemed to be a representation by the Borrower that the proceeds of the
advance will be used solely for the purposes required by this Section 2.3.

 

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2.4. Default Interest. During the continuation of any Event of Default, the
Borrower shall pay, on demand, at the Lender’s option, interest (after as well
as before judgment to the extent permitted by applicable law) on the principal
amount outstanding on the Loans at a per annum rate equal to the Default Rate.
2.5. Late Charges. The Borrower agrees that in the event any payment due under
either of the Notes shall become overdue for a period of ten (10) days, an
amount equal to five percent (5%) of that payment may be charged by the Lender
for the purpose of defraying the expense incident to handling such delinquent
payment and, if so charged by the Lender, shall be paid by the Borrower on
demand. In no event shall the interest contracted for, charged or received with
respect to the Loans, including such late charge, ever exceed the Maximum Lawful
Amount and it is agreed that the payment and collection of such late charges
shall be subject to the provisions of Section 8.13.
2.6. Computations and Manner of Payments.
(a) Time and Place. Borrower shall make each payment hereunder and under the
other Loan Documents not later than 1:00 p.m., Austin, Texas time, on the day
when due in same day funds (by wire transfer or otherwise) to the Bank at the
Bank’s office at 5120 S. Padre Island Drive, Corpus Christi, Texas 78466, to the
attention of Loan Operations or to the Bank at the Bank’s office at 3520 Bee
Cave Road, Austin, Texas 78746, to the attention of Loan Operations.
(b) Computation of Interest. Interest shall be calculated on the basis of a 365
or 366 day year (as the case may be) with the daily interest accrual being
multiplied by the actual days elapsed, but not exceeding the Maximum Lawful
Rate. Such computations shall be made including the first day but excluding the
last day occurring in the period for which such interest or payment is payable.
All payments under the Loan Documents shall be made in United States dollars.
(c) Business Day. Whenever any payment to be made hereunder or under any other
Loan Documents shall be stated to be due on a day other than a Business Day,
such payment shall be made on the next succeeding Business Day, and such
extension of time shall be included in the computation of interest or fees, if
applicable.
2.7. Fees. Subject to the provisions of Section 8.13 hereof, the Borrower shall
pay to the Lender the following fees:
(a) An Origination Fee for making available the Revolving Credit in the amount
of Three Thousand Seven Hundred Fifty and 00/100 Dollars ($3,750.00), of which
$1,000.00 has been paid and the remaining $2,750.00 shall be paid on the Closing
Date, and
(b) An Origination Fee for making available the Term Loan in the amount of Eight
Thousand Seven Hundred Fifty and 00/100 Dollars ($8,750.00), of which $1,500.00
has been paid and the remaining $7,250.00 shall be paid on the Closing Date, and

 

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(c) an unused fee which shall accrue daily with respect to the unused portion of
the Revolving Credit with the amount of the Unused Fee that shall accrue each
day being equal to the product of (i) 1/360 times (ii) .25% times (iii) the
amount by which the amount of Revolving Credit Limit exceeds on such day the
unpaid principal balance of the Revolving Credit on such day, payable on the
last day of each March, June, September and December, beginning with
December 31, 2010, and on the Revolving Credit Maturity Date.
2.8. Accounts Stated. All statements of account rendered by the Lender to the
Borrower relating to any Obligation or Indebtedness, including without
limitation all statements of principal, interest, expenses and costs owing by
the Borrower to the Lender, shall be presumed correct and accurate and shall
constitute an account stated between the Borrower and the Lender unless, within
thirty (30) days after receipt thereof by the Borrower, the Borrower shall
deliver to the Lender written objection thereto, specifying the error or errors,
if any, contained in such statement.
SECTION III.
Representations And Warranties
The Loan Parties jointly and severally represent and warrant to the Lender that:
3.1. Organization; Good Standing. The Borrower is a Delaware corporation duly
organized pursuant to its certificate of incorporation filed with the Secretary
of State of Delaware and is validly existing and in good standing under the laws
of the State of Delaware. Parent is a Washington corporation duly organized
pursuant to its certificate of incorporation filed with the Secretary of State
of Washington and is validly existing and in good standing under the laws of the
State of Washington. Holdings is a Florida corporation duly organized pursuant
to its certificate of incorporation filed with the Secretary of State of Florida
and is validly existing and in good standing under the laws of the State of
Florida. Each Loan Party (i) has all requisite power to own its respective
Properties and conduct its respective business as now conducted and as presently
contemplated, and (ii) is duly authorized to do business in each other
jurisdiction where a failure to be so authorized in such other jurisdiction
could reasonably be expected to have a Material Adverse Effect.
3.2. Authority, Enforceability. Each Loan Party has full legal right, power and
authority to execute, deliver, and perform its obligations under the Loan
Documents to which it is a party, and all necessary corporate action has been
taken (including any necessary shareholder approvals) for the execution,
delivery and performance of its obligations under this Agreement, the Notes and
the other Loan Documents to which a Loan Party is a party and the performance by
each Loan Party of its obligations hereunder and thereunder and each thereof is
the valid and binding obligation of the Loan Parties, enforceable in accordance
with its respective terms subject to applicable bankruptcy, insolvency,
reorganization, moratorium and other similar laws relating to or affecting
creditors’ rights generally and principles of equity.

 

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3.3. Corporate Organization. Borrower has disclosed to the Lender in writing a
complete and accurate listing of each Subsidiary of the Borrower as of the
Closing Date, including (a) the jurisdiction of its organization, (b) the
classes of its Capital Stock, and the numbers of shares authorized and
outstanding, (c) each owner of Capital Stock on the date hereof, indicating the
ownership percentage, and (d) all outstanding options, warrants, subscription
rights, rights of conversion or purchase, rights of first refusal, and similar
rights relating to such Capital Stock. As of the Closing Date, except as
disclosed to Lender in writing prior to the Closing Date, there are no options,
warrants or similar rights to any Person to acquire any Capital Stock of the
Borrower or Holdings, nor any agreements to issue or grant any such options,
warrants or similar rights. All outstanding Capital Stock of the Borrower and
Holdings is validly issued and fully paid and nonassessable and is owned free
and clear of all Liens, including any restrictions on hypothecation or transfer.
The Borrower has no Subsidiaries, other than Holdings, and 100% of the
outstanding Capital Stock of Holdings is owned by the Borrower.
3.4. Financial Condition. The financial statements of the Parent and the
Borrower (“Prior Financial Statements”) for the periods ending June 30, 2009,
September 30, 2009, December 31, 2009, March 31, 2010 and June 30, 2010, which
have been delivered to the Lender have been prepared in accordance with GAAP,
and fully and accurately reflect, in all material respects, the financial
condition of the Parent and the Borrower, as of the dates and for the periods
stated, subject (as to interim statements) to the year-end adjustments and the
absence of footnotes. As of the Closing Date, there has been no event or
occurrence which could reasonably be expected to have a Material Adverse Effect
since June 30, 2010.
3.5. Debt, Liens, Liabilities. As of June 30, 2010, the Parent and its
Subsidiaries had no outstanding Debt, Liens, or Contingent Liabilities except as
set forth in the June 30, 2010 Prior Financial Statements. As of the Closing
Date, except for Liabilities incurred in the normal course of business and not
material in amount (either individually or in the aggregate), the Parent and its
Subsidiaries have no liabilities, direct or contingent, that have arisen or been
incurred or accrued subsequent to the date of the June 30, 2010 Prior Financial
Statement. The execution and delivery of this Agreement, the Notes and the other
Loan Documents by the Loan Parties, and the performance of the obligations and
consummation of the transactions contemplated herein and therein do not and will
not conflict with or result in a breach of any of the terms, conditions or
provisions of, or constitute a default under, (i) any bond, debenture, note or
other evidence of indebtedness or (ii) any contract, indenture, mortgage, loan
agreement, lease, joint venture or other agreement or instrument to which the
Parent or any of its Subsidiaries is a party or by which the Parent or any of
its Subsidiaries are bound, or result in any violation by the Parent of any of
its Subsidiaries of any law, order, rule or regulation of any court or
Governmental Authority.
3.6. Compliance with Legal Requirements, Agreements, Etc.. Neither the Parent
nor any of its Subsidiaries is in default in any respect under any Legal
Requirement binding upon or affecting the Parent or any of its Subsidiaries or
by which any of their Properties may be bound or affected, or under any
agreement, document, contract or other undertaking or instrument to which any
such Person is a party or by which any such Person is bound (including, without
limitation, this Agreement) which default could reasonably be expected to have a
Material Adverse Effect, and as of the Closing Date no event has occurred, and
none was foreseen, which could reasonably be expected to have a Material Adverse
Effect.

 

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3.7. Taxes. The Parent and its Subsidiaries have filed all federal, state and
other Tax returns that are required to be filed by any of them, and have paid
all Taxes as shown on any such returns, as well as all other Taxes, to the
extent due and payable by any of them, except Taxes that are being contested in
good faith by appropriate proceedings and for which the Parent or such
Subsidiary, as applicable, has set aside on its books adequate reserves to the
extent required in accordance with GAAP. All Tax liabilities of the Parent and
its Subsidiaries are adequately provided for on their books, including interest
and penalties, and adequate reserves have been established therefor in
accordance with GAAP. As of the Closing Date, no income Tax liability has been
asserted by taxing authorities for Taxes in excess of those already paid and no
taxing authority has notified the Parent or any of its Subsidiaries of any
deficiency in any Tax return.
3.8. No Leases. As of the Closing Date, the Borrower is not the lessee of real
Property, except as has been disclosed to the Lender in writing prior to the
Closing Date. As of the Closing Date, Holdings is not the lessee of any real
Property. As of the Closing Date, the Borrower has disclosed to the Lender in
writing prior to the Closing Date all non-fee simple estates in real property
owned by the Borrower, including all licenses granting the Borrower the right to
make certain uses of real Property. The Borrower has delivered to the Lender
true, correct and complete copies of all documents and instruments representing
and describing such interests in real Property and licenses. As of the Closing
Date, the Borrower enjoys the peaceful and undisturbed possession under all
leases under which it operates. The Borrower is not in default under any of the
leases under which it operates, except any default which could not reasonably be
expected to have a Material Adverse Effect. All such leases, easements, rights
of way and licenses are valid and subsisting with no default existing or, to the
Borrower’s Knowledge, threatened, except any default which could not reasonably
be expected to have a Material Adverse Effect. None of such leases, easements,
rights of way or licenses contains any provision which could reasonably be
expected to have a Material Adverse Effect. As of the Closing Date, except as
disclosed to the Lender in writing prior to the Closing Date, the Borrower has
entered into no leases of any part of the Titusville Facility and no such leases
exist.
3.9. Material Customer Agreements. A complete and accurate listing of all
Material Customer Agreements in existence on the Closing Date has been furnished
to the Lender. All such Material Customer Agreements have been duly authorized,
executed and delivered by the Borrower and (to the Borrower’s Knowledge) the
other parties thereto. There is no litigation, claim of breach or default
pending or, to the Borrower’s Knowledge, threatened with respect to any such
agreements which could reasonably be expected to have a Material Adverse Effect.
The Borrower has no notice of or belief that any party to any such Agreement is
contemplating a breach, default or termination for any reason of any such
agreement which could reasonably be expected to have a Material Adverse Effect.
3.10. Conduct of Business. As of the Closing Date, Borrower has disclosed to the
Lender in writing prior to the Closing Date the location of each place of
business of the Loan Parties and the chief executive office of the Loan Parties.
As of the Closing Date, the present location of the books and records of the
Loan Parties concerning Accounts has been disclosed to the Lender in writing
prior to the Closing Date. As of the Closing Date, Borrower has disclosed to the
Lender in writing prior to the Closing Date all trade names, assumed names and
the like under which the Borrower and Holdings presently conduct business.

 

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3.11. Title to Properties. The Borrower and Holdings have good and indefeasible
title to all of the material Properties (including, without limitation, the
Collateral) used or useful in the operation of their respective businesses and
none of the Properties of the Borrower or Holdings is subject to any Liens
except Permitted Liens.
3.12. No Consents Necessary. No consent or approval of any third party,
including, without limitation, any Governmental Authority, is required in
connection with the execution, delivery or performance by the Loan Parties of
this Loan Agreement, the Notes or any other Loan Documents.
3.13. ERISA. With respect to each Plan, the Loan Parties and each member of
their Controlled Group have fulfilled their obligations in all material
respects, including obligations under the minimum funding standards of ERISA and
the Code and are in compliance in all material respects with the provisions of
ERISA and the Code. No event has occurred which could result in a material
liability with respect to any Loan Party or any member of its Controlled Group
to the PBGC or a Plan (other than to make contributions in the ordinary course)
that could reasonably be expected to have a Material Adverse Effect. There have
not been any nor are there now existing any events or conditions that would
reasonably be expected to cause the lien provided under Section 4068 of ERISA to
attach to any Property of any Loan Party or any member of a Controlled Group of
any Loan Party. There are no Unfunded Liabilities with respect to any Plan that
could reasonably be expected to have a Material Adverse Effect. To the Knowledge
of the Loan Parties, no “prohibited transaction” has occurred with respect to
any Plan.
3.14. Solvency. The present fair salable value of the Borrower’s assets exceeds
the amount that will be required to pay the probable liability on the Borrower’s
existing debts (whether matured or unmatured, liquidated or unliquidated,
absolute, fixed or contingent, including its obligations under this Agreement,
both on a consolidated and a Borrower-only basis) as they become absolute and
matured. In determining “present fair salable value” for purposes of making this
representation, the Borrower has utilized as a guideline amounts it believes
would be reached by a willing seller and a willing buyer under no compulsion to
make the sale. The Borrower’s assets are not an unreasonably small capital for
it to carry on its business as currently proposed to be conducted. “Unreasonably
small capital” is dependent upon the nature of the particular business or
businesses conducted or to be conducted, and the statement made in the preceding
sentence is based upon the current and anticipated future capital requirements
for the current and anticipated future conduct of the business of the Borrower.
The Borrower does not intend to or believe that it will incur debts that will be
beyond its ability to pay as they mature.
3.15. No Environmental Hazard. To the Knowledge of the Loan Parties, no Loan
Party nor any of their respective Subsidiaries, is in violation, or alleged
violation of any Environmental Laws, which violation could reasonably be
expected to have a Material Adverse Effect. As of the Closing Date, to
Borrower’s Knowledge, except to the extent disclosed to the Lender in writing
prior to the Closing Date, no Loan Party nor any of their respective
Subsidiaries has received written notice from any third party including, without
limitation, any Governmental Authority, (i) that it has been identified by the
United States Environmental Protection Agency (“EPA”) as a potentially
responsible party under CERCLA with respect to a site listed on the National
Priorities List, 40 C.F.R.

 

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Part 300 Appendix B (1986); (ii) that any hazardous waste, as defined by 42
U.S.C. §9601(5), any hazardous substances as defined by 42 U.S.C. §9601(14), any
pollutant or contaminant as defined by 42 U.S.C. §9601(33) or any toxic
substances or hazardous materials or other chemicals or substances regulated by
any Environmental Laws (“Hazardous Substances”) which it has generated,
transported or disposed of have been found at any site at, on or under any real
property for which a federal, state or local agency or other third party has
conducted or has ordered that any Loan Party or their respective Subsidiaries
conduct a remedial investigation, removal or other response action pursuant to
any Environmental Law; or (iii) that it is or shall be a named party to any
claim, action, cause of action, complaint, or legal or administrative proceeding
(in each case, contingent or otherwise) arising out of any third party’s
incurrence of costs, expenses, losses or damages of any kind whatsoever in
connection with the release of Hazardous Substances. To the Knowledge of the
Loan Parties, (i) no portion of either the VAFB Facility or the Titusville
Facility has been used by the Borrower, Holdings, or any customer of the
Borrower as a landfill or for dumping or for the handling, processing, storage
or disposal of Hazardous Substances except in compliance with applicable
Environmental Laws, except any noncompliance which could not reasonably be
expected to have a Material Adverse Effect and (ii) no underground tank for
Hazardous Substances has been operated by the Borrower, Holdings or any customer
of the Borrower on the VAFB Facility or the Titusville Facility except in
compliance with applicable Environmental Laws, except any noncompliance which
could not reasonably be expected to have a Material Adverse Effect; (iii) in the
course of any activities conducted by the Borrower, Holdings, or any customer of
the Borrower, no Hazardous Substances have been generated or are being used on
the VAFB Facility or the Titusville Facility, except in the ordinary course of
business and in compliance with applicable Environmental Laws, other than any
noncompliance which could not reasonably be expected to have a Material Adverse
Effect; (iv) to the Knowledge of the Loan Parties, there has been no past or
present releasing, spilling, leaking, pumping, pouring, emitting, emptying,
discharging, injecting, escaping, disposing or dumping (a “Release”) of
Hazardous Substances on, upon, into or from the VAFB Facility or the Titusville
Facility, which Release could reasonably be expected to have a Material Adverse
Effect; (v) to the Knowledge of the Loan Parties, there have been no Releases
on, upon, from or into any real property in the vicinity of the VAFB Facility or
the Titusville Facility, which, through soil or groundwater contamination, may
have come to be located on, and which could reasonably be expected to have a
Material Adverse Effect; and (vi) to the Knowledge of the Loan Parties, any
Hazardous Substances that have been generated on the VAFB Facility or the
Titusville Facility by the Borrower or Holdings or any customers have been
transported off-site, treated and disposed of in compliance with applicable
Environmental Laws, except where such noncompliance could not reasonably be
expected to have a Material Adverse Effect.
3.16. No Margin Stock. Neither the Borrower nor any of its Subsidiaries is
engaged principally, or as one of its important activities, in the business of
extending credit for the purpose of purchasing or carrying margin stock (within
the meaning of Regulations G, T, U or X of the Board of Governors of the Federal
Reserve System), and no part of the proceeds of any extension of credit under
this Agreement will be used to purchase or carry any such margin stock and no
part of the proceeds of any extension of credit under this Agreement will be
used to extend credit to others for the purpose of purchasing or carrying any
such margin stock.

 

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3.17. Patents, Trademarks, Franchises, Licenses, Etc. The Borrower has obtained
and holds all franchises, licenses, governmental permits, leases, patents,
trademarks, service marks, tradenames, copyrights, and other authorizations
necessary to conduct its business as presently conducted and as proposed to be
conducted (collectively, “Rights”), and each thereof is in full force and effect
and no event has occurred which constitutes or, after notice or lapse of time or
both, would constitute, a default under any thereof. As of the Closing Date,
each and every patent (and pending applications for each thereof) presently
assigned to the Borrower, and each and every trademark and copyright (and
pending applications for each thereof) presently owned by the Borrower and
presently utilized by the Borrower in the conduct of its business has been
disclosed by Borrower to Lender in writing prior to the Closing Date, including
all licenses and authorizations possessed by the Borrower for the use of
patents, trademarks and copyrights (and applications for each thereof) not owned
by the Borrower. To the Borrower’s Knowledge, except as disclosed by Borrower to
Lender in writing prior to the Closing Date, no claim which could reasonably be
expected to have a Material Adverse Effect has been asserted by any Person with
respect to the use of any of the Borrower’s Rights. To the Borrower’s Knowledge,
the use of such Rights by the Borrower does not infringe on the rights of any
Person, subject to such claims and infringements as do not, in the aggregate,
give rise to any liabilities on the part of the Borrower which could reasonably
be expected to have a Material Adverse Effect.
3.18. No Pending Litigation. No Litigation is pending or, to the Knowledge of
the Loan Parties, threatened against or affecting any Loan Party or any
Subsidiary of a Loan Party (a) which involves any of the transactions
contemplated by this Agreement or any other Loan Documents or (b) which, if
adversely determined, could reasonably be expected to have a Material Adverse
Effect.
3.19. OFAC. None of the Loan Parties, nor any Subsidiary or Affiliate of any
Loan Party, is a Sanctioned Person or has any of its assets in a Sanctioned
Country or does business in or with, or derives any of its operating income from
investments in or transactions with, Sanctioned Persons or Sanctioned Countries
in violation of economic sanctions administered by OFAC. The proceeds from the
Loans will not be used to fund any operations in, finance any investments or
activities in, or make any payments to, a Sanctioned Person or a Sanctioned
Country. As used herein, “OFAC” means the U.S. Department of the Treasury’s
Office of Foreign Assets Control, “Sanctioned Country” means a country subject
to a sanctions program identified on the list maintained by OFAC and published
from time to time, and “Sanctioned Person” means (i) a person named on the list
of Specially Designated Nationals or Blocked Persons maintained by OFAC and
published from time to time, or (ii) (A) an agency of the government of a
Sanctioned Country, (B) an organization controlled by a Sanctioned Country, or
(C) a person resident in a Sanctioned Country to the extent subject to a
sanctions program administered by OFAC.
3.20. Investment Company Act. None of the Loan Parties is an investment company
within the meaning of the Investment Company Act of 1940, as amended, or,
directly or indirectly, controlled by or acting on behalf of any Person which is
an investment company, within the meaning of said Act.

 

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3.21. Securities Acts. None of the Loan Parties has issued any unregistered
securities in violation of the registration requirements of Section 5 of the
Securities Act of 1933, as amended, or any other law, and none are violating any
material rule, regulation or requirement under the Securities Act of 1933, as
amended, or the Securities and Exchange Act of 1934, as amended. The Loan
Parties are not required to qualify this Agreement or any other Loan Document as
an indenture under the Trust Indenture Act of 1939, as amended, in connection
with the Borrower’s execution and delivery of the Notes.
3.22. Full Disclosure. Neither this Agreement nor any certificate or statement
or any other data furnished by any Loan Party in connection with the negotiation
of this Agreement or the transactions contemplated hereby (taken as a whole and
as modified or supplemented by other information so furnished) contains any
untrue statement of a material fact or omits a material fact known to any Loan
Party necessary to make the statements contained herein or therein not
misleading ; provided that, with respect to projected financial information, the
Loan Parties represent only that such information was prepared in good faith
based upon assumptions believed to be reasonable at the time and which continue
to be believed to be reasonable as of the Closing Date.
3.23. Survival of Representations and Warranties. All representations and
warranties contained in this Agreement and any other Loan Documents shall
survive, and not be waived by, the execution hereof by the Lender, any
investigation or inquiry by the Lender, or by the making of the Loans.
SECTION IV.
Affirmative Covenants
Until all Indebtedness has been paid and all Obligations performed, the Loan
Parties covenant and agree with the Lender as follows:
4.1. Reporting Requirements. The Loan Parties will promptly furnish to the
Lender from time to time the following information:
(a) As soon as possible and in any event within 5 Business Days after the
occurrence of any Event of Default or Default to the Knowledge of a Loan Party,
the Loan Parties will give a written statement to the Lender of the default,
setting forth details of such Event of Default or Default, the period of
existence thereof and the action which the Loan Parties have taken and propose
to take with respect thereto.
(b) As soon as available and in any event within 90 days after the end of each
fiscal year of the Parent, SEC Form 10-K audited consolidated financial
statements of the Parent certified without any Impermissible Qualification by an
independent accountant reasonably satisfactory to the Lender that such financial
statements fairly present, in all material respects, the financial position of
the Parent in conformity with GAAP.
(c) As soon as available and in any event within 45 days after the end of each
fiscal quarter (not including fiscal year-end), unaudited financial statements
of the Parent on SEC Form 10-Q for the quarter then ending, and for the year to
date, certified by a principal officer of the Parent as fairly presenting in all
material respects the financial condition and results of operations of the
Parent and its Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes, together with a backlog and contracts listing in such form
and detail as the Lender may reasonably require and, in each case, reflecting
the addition or the expiration or termination of any Material Customer
Agreement.

 

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(d) As soon as available and in any event within 15 days after each calendar
month, a Borrowing Base Certificate properly completed and executed by the
Borrower, together with a receivables and payable aging report in such form and
detail as the Lender may reasonably require.
(e) As soon as available and in any event within 30 of the filing thereof,
copies of all annual federal income tax returns and amendments thereto of the
Loan Parties.
(f) As soon as available and in any event within 45 days after the end of each
fiscal quarter, the Borrower shall deliver to the Lender a Compliance
Certificate.
(g) Within 30 days prior to each fiscal year end of the Parent and the Borrower,
projected statements of profit and loss and cash flows for the Parent and the
Borrower, prepared on a quarterly basis, for the next succeeding fiscal year,
such projections to be in form and detail reasonably satisfactory to the Lender
and to be submitted to the Lender together with a narrative description of the
assumptions upon which such projections are based and such other information as
the Lender may reasonably request.
(h) Promptly, and in any event within 5 Business Days following written request
from the Lender, the Borrower shall provide to the Lender complete and correct
copies of all Material Customer Agreements then in effect and not previously
furnished to the Lender, all as amended, together with all exhibits and
schedules thereto.
(i) Promptly, and in any event within 5 Business Days following written request
from the Lender, the Borrower shall provide to the Lender a list of all awarded
Material Customer Agreements.
(j) Promptly, and in any event within 5 Business Days after Knowledge thereof by
any Loan Party, notice of the occurrence of any event or the existence of any
condition which could reasonably be expected to have a Material Adverse Effect.
(k) Such other information as the Lender may reasonably request from time to
time.
4.2. Legal Requirements. The Parent will (and will cause its Subsidiaries to)
comply in all material respects with all Legal Requirements applicable to it and
its Subsidiaries, except where the failure to so comply could not reasonably be
expected to have Material Adverse Effect.
4.3. Performance of Obligations; Payment of Debt. The Parent shall, and shall
cause each of its Subsidiaries to, pay its trade debt in accordance with its
past practices, and in any event, before any trade creditor takes any action or
terminates any relationship, which such action or termination could reasonably
be expected to have Material Adverse Effect.

 

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4.4. Compliance with Agreements. The Parent shall comply, and shall cause each
of its Subsidiaries to comply, in all material respects with all agreements,
contracts, instruments and undertakings binding on it or any of its Subsidiaries
or affecting the Property or business of any such Persons, the non-compliance
with which could reasonably be expected to have a Material Adverse Effect.
4.5. Continuity of Senior Management. Within five (5) Business Days of any such
change, the Loan Parties will (a) notify the Lender of any Change of Management,
and (b) furnish the Lender a plan to replace the then outgoing Person with a
Person of equal or higher qualification for such position within thirty
(30) Business Days.
4.6. Principal Accounts. The Borrower shall maintain its principal depository
and operating accounts with the Lender, with an aggregate amount on deposit of
no less than $750,000.00 at all times, subject to the provisions of Section 8.13
hereof.
4.7. Payment of Expenses. To the extent not prohibited by applicable law and
subject to the provisions of Section 8.13 hereof, the Loan Parties will pay all
reasonable costs and expenses and reimburse the Lender for any and all
reasonable expenditures of every character incurred or expended from time to
time by the Lender to third parties for services rendered in connection with the
Lender’s negotiation, documenting and closing the transactions reflected by the
provisions of this Agreement and any amendments, modifications, replacements and
additions hereto and to the other Loan Documents, as well as evaluating,
monitoring, administering and protecting the Loans and the Collateral and
creating, perfecting and realizing upon the Lender’s Liens upon the Collateral,
and all costs and expenses incurred or expended by the Lender to third parties
for services rendered and related to the Lender’s exercising any of its rights
and remedies hereunder, under this Agreement, the Notes, or any of the other
Loan Documents, or at law, including, without limitation, all appraisal fees,
consulting fees, filing fees, Taxes, brokerage fees and commissions, fees
incident to security interests, liens and other title searches and reports,
escrow fees, attorney’s fees, legal expenses, court costs, auctioneer fees and
expenses, other fees and expenses incurred in connection with liquidation or
sale of the Collateral and all other professional fees. Any amount to be paid
hereunder by the Loan Parties to the Lender, to the extent not prohibited by
applicable law, shall bear interest from the date of expenditure until
reimbursed to the Lender by the Borrower at the highest of any applicable
Default Rate.
4.8. Guaranties, Liens and Security Interest.
(a) To secure and guarantee payment of the Indebtedness and performance of the
Obligations, and as a condition of any approval by the Lender of any advances
hereunder, (i) subject to the exceptions and limitations set forth in the
Collateral Documents, the Borrower and Holdings shall grant and create (or cause
to be granted and created) in favor of the Lender a first, prior and perfected
(in the case of perfection, to the extent perfection can be accomplished by the
filing of UCC financing statements and by the recording of the Mortgage)
security interest (subject to Permitted Liens) in and to all collateral which is

 

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described on Schedule 4.8 attached hereto, and (ii) the Parent and Holdings
shall guarantee the payment and performance thereof. The Loan Parties shall
execute and deliver (or cause to be executed and delivered) from time to time
the Collateral Documents to the Lender together with all such other instruments,
documents, certificates, assignments, financing statements, guaranty agreements,
pledge agreements, security agreements and other items as reasonably required by
the Lender to create and perfect the liens, security interests and assignments
described herein and shall cause such of the Collateral Documents as the Lender
may require to be filed or recorded and shall pay all costs and expenses of
doing so. All Collateral Documents shall be in Proper Form.
(b) With respect to any assets of the types defined as Collateral in this
Agreement that are acquired after the Closing Date or in which a first-priority
lien in favor of the Lender has not been granted as of the Closing Date (subject
to Permitted Liens), the Loan Parties shall promptly grant or cause to be
granted to the Lender a lien, upon the terms contained in the Collateral
Documents, on all such Property and interests, free of all Liens except
Permitted Liens. The Loan Parties, at their own expense, shall execute,
acknowledge and deliver, or cause the execution, acknowledgment and delivery of,
and thereafter register, file or record, or cause to be registered, filed or
recorded, in an appropriate governmental office, any document or instrument
reasonably deemed by the Lender to be necessary or desirable for the creation,
perfection, renewal and continuation of the foregoing Liens and shall pay, or
cause to be paid, all Taxes, fees and reasonable legal expenses related to such
registration, filing or recording. All such Collateral Documents shall be in
Proper Form.
(c) Upon any acquisition or formation by the Borrower of a Subsidiary, the
Borrower shall execute and deliver to the Lender a pledge agreement in Proper
Form pursuant to which the Borrower shall pledge all of the Capital Stock of
such Subsidiary it holds or will hold in the future to the Lender as collateral
security for the payment and performance of all Indebtedness and Obligations.
4.9. Payment of Taxes The Parent will and will cause each of its Subsidiaries
to, promptly pay and discharge all lawful Taxes imposed upon it or upon its
income or profit or upon any Property belonging to it, unless such Tax shall not
at the time be due and payable, or if the validity thereof shall currently be
contested on a timely basis in good faith by appropriate proceedings (provided
that the enforcement of any Liens arising out of any such nonpayment shall be
stayed or bonded during the proceedings) and adequate reserves with respect to
such Tax shall have been established.
4.10. Adequate Records; Inspection Rights. The Loan Parties shall keep (and
shall cause each of their respective Subsidiaries to keep) adequate records and
books of account, in accordance with GAAP, of all of its transactions so that at
any time, and from time to time, its true and complete financial condition may
be readily determined. The Loan Parties shall, and shall cause each of their
respective Subsidiaries to permit the Lender to examine and make copies or any
abstracts from their records and books of account, to visit and inspect their
Properties and to discuss their affairs, finances, and accounts with any of
their directors, officers, employees, accountants, attorneys and other
representatives, all as the Lender may reasonably request.

 

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4.11. Maintenance of Existence. The Loan Parties shall, and shall cause the
Parent, the Borrower and Holdings to, continue to be organized and existing in
good standing under the laws of the jurisdiction of their respective formation.
4.12. Maintenance of Insurance. The Loan Parties will maintain insurance on its
properties, business interruption insurance, worker’s compensation insurance,
and liability insurance on its business and properties, with financially sound
and reputable insurance companies, at least in such amounts and against such
risks as are usually insured by Persons engaged in similar businesses and are
reasonable acceptable to the Lender. All policies covering the Collateral are to
be made payable to the Lender, as its interest may appear, in case of loss,
under a standard non contributory “lender” or “secured party” clause and are to
contain such other provisions as the Lender may require to fully protect the
Lender’s interest in the Collateral and to any payments to be made under such
policies. All certificates of insurance are to be delivered to the Lender and
the policies are to be premium prepaid, and, with respect to insurance covering
the Collateral, with the loss payable and additional insured endorsement in
favor of the Lender, in Proper Form, and such other Persons as the Lender may
designate from time to time, and shall provide for not less than 30 days’ prior
written notice to the Lender of the exercise of any right of cancellation. If
any Loan Party or any of its Subsidiaries fails to maintain such insurance, the
Lender may arrange for such insurance, but at the Borrower’s expense and without
any responsibility on the Lender’s part for obtaining the insurance, the
solvency of the insurance companies, the adequacy of the coverage, or the
collection of claims.
COLLATERAL PROTECTION INSURANCE NOTICE
In accordance with the provisions of Section 307.052(a) of the Texas Finance
Code, the Lender hereby notifies the Loan Parties as follows:
(A) the Loan Parties are required to:
(i) keep the collateral insured against damage in the amount the Lender
specifies;
(ii) purchase the insurance from an insurer that is authorized to do business in
the State of Texas (or such other state in which any insured Property is
located) or an eligible surplus lines insurer; and
(iii) name the Lender as the person to be paid under the policy in the event of
a loss;
(B) the Loan Parties must, if required by the Lender, deliver to the Lender a
copy of the policy and proof of the payment of premiums; and
(C) if the Loan Parties fail to meet any requirement listed in Paragraph (A) or
(B), the Lender may obtain collateral protection insurance on behalf of the Loan
Parties at the Loan Parties’ expense.

 

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4.13. Maintenance of Properties. The Borrower and Holdings shall maintain, all
of their material tangible Property in good condition and repair, ordinary wear
and tear excepted, and shall preserve and maintain all licenses, privileges,
franchises, certificates and the like necessary for the operation of their
businesses.
4.14. Landlord Subordination Agreements. The Borrower shall use commercially
reasonable efforts to cause each Person who is a landlord of any real Property
occupied and utilized by the Borrower or Holdings and at which Collateral with a
value in excess of $750,000.00 is located in connection with leases entered into
after the Closing Date (excluding renewals or extensions of leases existing as
of the Closing Date), to execute and deliver to the Lender landlord’s
subordination agreements in Proper Form, whereby each of such landlords validly
subordinates any and all liens held by such landlords against all or any portion
of the Collateral to the Liens in favor of the Lender.
4.15. Indemnity.
(a) The Loan Parties jointly and severally agree to defend, protect, indemnify
and hold harmless the Lender, its Affiliates, and each of their respective
(including such Affiliates’) officers, directors, employees, agents, attorneys,
shareholders and consultants (including, without limitation, those retained in
connection with the satisfaction or attempted satisfaction of any of the
conditions set forth herein) of each of the foregoing (collectively,
“Indemnitees”) from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, claims, costs, expenses and
disbursements of any kind or nature whatsoever (including, without limitation,
the reasonable fees and disbursements of counsel for such Indemnitees in
connection with any investigative, administrative or judicial proceeding,
whether or not such Indemnitees shall be designated a party thereto or such
proceeding shall have actually been instituted), imposed on, incurred by, or
asserted against such Indemnitees (whether direct, indirect or consequential and
whether based on any federal, state, or local laws and regulations, under common
law or at equitable cause, or on contract, tort or otherwise), arising from or
connected (a) with the past, present, or future operations of the Loan Parties,
any of their Subsidiaries, any Affiliate or any predecessors in interest, or
(b) with the past, present or future environmental condition of the Property of
the Loan Parties, any of their Subsidiaries, any Affiliate or any predecessors
in interest, or (c) in any way relating to or arising out of this Agreement, the
Loan Documents, or any act, event or transaction or alleged act, event or
transaction relating or attendant thereto, or the making of any participations
in the Loans, including in connection with, or as a result, in whole or in part,
of any negligence of the Lender (other than those matters involving a claim by a
participant purchaser against the Lender and not the Loan Parties), or based
upon or asserted on the basis of strict liability, or the use or intended use of
the proceeds of the Loans hereunder, or in connection with any investigation of
any potential matter covered hereby, but excluding any claim or liability that
arises as the result of the gross negligence or willful misconduct of any
Indemnitee, as finally judicially determined by a court of competent
jurisdiction, and excluding matters raised by any shareholders of the Lender
against the Lender or its management (collectively, “Indemnified Matters”). In
addition, the Loan Parties shall periodically, upon request, reimburse each
Indemnitee for its reasonable legal and other actual expenses (including the
cost of any investigation and preparation) incurred in connection with any
Indemnified Matter.

 

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(b) The reimbursement, indemnity and contribution obligations under this Section
shall be in addition to any liability which the Loan Parties may otherwise have,
shall extend upon the same terms and conditions to each Indemnitee, and shall be
binding upon and inure to the benefit of any successors, assigns, heirs and
personal representatives of the Loan Parties, the Lender, and all other
Indemnitees. The obligations of the Loan Parties under this Section shall
survive (i) the execution of this Agreement and (ii) any termination of this
Agreement and payment of the Obligations.
(c) THE INDEMNITY IN THIS SECTION WILL APPLY EVEN IF THE LOSS OR DAMAGE IS
CAUSED IN WHOLE OR IN PART BY THE ORDINARY NEGLIGENCE OR STRICT LIABILITY OF THE
INDEMNITEE BUT WILL NOT APPLY TO THE EXTENT THE LOSS OR DAMAGE IS CAUSED BY THE
GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE INDEMNITEE.
4.16. Further Assurances. The Loan Parties shall perform or cause to be
performed any and all things the Lender may hereafter reasonably request to
protect, perfect or more fully evidence the rights and agreements established or
contemplated by this Agreement.
SECTION V.
Negative Covenants
Until all Indebtedness has been paid and all Obligations performed, the Loan
Parties covenant and agree with the Lender as follows:
5.1. Financial Covenants. The Borrower shall comply with the following
covenants, calculated on a basis consolidated with Holdings:
(a) Leverage Ratio: The Borrower’s Leverage Ratio shall not be greater than 0.50
to 1.00 at any time.
(b) Debt Service Coverage Ratio (After Distributions/Advances): The Borrower’s
Debt Service Coverage Ratio (After Distributions/Advances) shall not be less
than 1.00 to 1.00 at any time.
5.2. Debt. Neither the Borrower nor Holdings shall create, incur, assume, become
or be liable in any manner in respect of, or suffer to exist, any Debt, except
Permitted Debt.
5.3. Contingent Liabilities. Neither the Borrower nor Holdings shall create,
incur, assume, become or be liable in any manner in respect of, or suffer to
exist, any Contingent Liabilities, except (a) Contingent Liabilities under or
relating to the Loan Documents, and (b) Contingent Liabilities resulting from
the endorsement of negotiable instruments for collection in the ordinary course
of business.

 

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5.4. Liens. Neither the Borrower nor Holdings shall create or suffer to exist
any Lien upon any of their Properties, except Permitted Liens. The Parent shall
not create or suffer to exist any Lien upon the Capital Stock of the Borrower.
5.5. Distribution/Advances, Restricted Payments and Restricted Purchases. The
Borrower shall not declare or pay Distribution/Advances, or make any Restricted
Payments or Restricted Purchases, except that the Borrower may make (a) a
onetime Distribution/Advance to the Parent for the sole purpose of replenishing
funds used by the Parent in the payment in full of its Senior Convertible Notes
as provided in Section 2.3(b) hereof, and (b) Distribution/Advances to the
Parent in the normal course of business, if no Event of Default then exists or
would exist after giving effect to the Distribution/Advance.
5.6. Issuance of Borrower’s Capital Stock. Borrower shall not issue any of its
Capital Stock to any Person other than the Parent.
5.7. Disposal of Properties. Neither the Borrower nor Holdings shall sell or
lease any of their material assets used or useful in their respective businesses
except in the ordinary course of its business, nor sell any of their respective
assets to any other Person with the understanding or agreement that such assets
shall be leased back to a Loan Party or Subsidiary of a Loan Party. Without
limiting the generality of the foregoing, Holdings shall not enter into, nor
permit to exist, any lease of any or all of the Titusville Facility, other than
contractual arrangements entered into in the ordinary course of business which
are incidental to service agreements and pursuant to which customers are allowed
to store fairings and other equipment.
5.8. Tangible Net Worth. Neither the Borrower nor Holdings will allow its
Tangible Net Worth to be less than the sum of $32,500,000.00 at any time.
5.9. Reorganization, Merger, Etc. Neither the Borrower nor Holdings will
reorganize, merge or consolidate with or acquire all or substantially all of the
assets or Capital Stock of any Person, convert its respective organizational
structure to a different form of entity, enter into any joint ventures, create
subsidiaries, or make any other substantial change in its respective
capitalization or organizational structure.
5.10. Transactions with Affiliates. Any other provision of this Agreement
notwithstanding, neither the Borrower nor Holdings shall carry on any
transaction with any Affiliate, except at arm’s length on terms no less
favorable to the Borrower or Holdings, as the case may be, than otherwise
obtainable in the marketplace generally, except, with respect to any Person
serving as an officer, director, employee or consultant of any Loan Party, any
of the following: (i) the payment of reasonable compensation, benefits or
indemnification liabilities in connection with his or her services in such
capacity, (ii) the making of advances for travel or other business expenses in
the ordinary course of business or (iii) such Person’s participation in any
benefit or compensation plan.

 

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5.11. No Change of Location, Trade Names, Etc. The Loan Parties will not take
any of the following actions without first (i) giving the Lender at least thirty
(30) days prior written notice thereof and (ii) executing, delivering, filing
and recording (and causing to be executed, delivered, filed and recorded) such
additional assignments, guaranties, security agreements, UCC Financing
Statements, and other instruments, agreements and writings and taking such other
actions as the Lender may reasonably request in order to confirm, ratify, grant,
evidence or perfect all or any applicable part of the Indebtedness and
Obligations and any and all liens, security interests and guaranties for the
payment and performance thereof:
(a) change or add to the locations of the Borrower’s business or the chief
executive office of any Loan Party; or
(b) conduct business under any trade name, assumed name or the like other than
those under which business is presently conducted.
5.12. Investments. Neither the Borrower nor Holdings will own, purchase or
acquire directly or indirectly any stock or securities of, or make any
investment in, any other Person (other than existing investments by the Borrower
in its present and future Subsidiaries in the ordinary course of the Borrower’s
business), except for (a) cash; (b) demand deposits or interest-bearing time and
Eurodollar deposits, certificates of deposits, certificates of deposit or
similar banking arrangements with banks; (c) direct obligations of the United
States of America in the form of obligations of the United States Treasury or of
any other governmental agency or instrumentality whose obligations constitute
full faith and credit obligations of the United States of America, which have
maturities of ten (10) years or less; (d) commercial paper rated P-1 (or higher)
by Moody’s Investors Services, Inc. or A-1 (or higher) by Standard & Poor’s
Corporation; (e) bonds and other fixed income instruments (including tax-exempt
bonds) from companies or public entities rated investment grade, and mutual
funds that invest substantially all of their assets in such bonds and other
fixed income instruments; and (f) mutual funds or money market funds that invest
substantially all of their assets in instruments described above in (a), (b),
(c), (c), or (e) hereof. Borrower agrees to pledge to Lender at Lender’s Request
any such stocks or securities owned or acquired as described in this Section.
5.13. Payments of Subordinated Debt. The Borrower will not at any time make any
payment with respect to any Subordinated Debt except as permitted by any
Subordination Agreement.
5.14. No Change in Business. The Borrower will not change the nature of its
respective business or enter into any business which is substantially different
from the business in which it is presently engaged.
5.15. Fiscal Year. Borrower will not change fiscal years unless Borrower gives
Lender prompt written notice thereof and executes such amendments to the
provisions of Section 4.1(b) and Section 4.1(c) hereof as the Lender may
reasonably require to maintain continuity of required reporting.
5.16. Margin Stock. No part of the proceeds of any of the Loans will be used to
purchase or carry any margin stock (within the meaning of Regulations G, T, U or
X of the Board of Governors of Federal Reserve System) or to extend credit to
others for the purpose of purchasing or carrying any such margin stock and the
making of and performance by the Loan Parties of this Agreement and the
Collateral Documents will not violate any provisions of said Regulations G, T, U
or X.

 

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5.17. Limitation on Negative Pledge Clauses. Neither the Borrower nor Holdings
shall enter into any agreement, other than this Agreement and the other Loan
Documents, or any purchase money mortgages or financing leases permitted by this
Agreement (in which cases, any prohibition or limitation shall only be effective
against the assets financed thereby) (a) which prohibits or limits the ability
of the Borrower to create, incur, assume or suffer to exist any Liens upon any
of their respective Properties, whether now owned or hereafter acquired or
(b) which prohibits or requires the consent of any Person to any amendment,
modification or supplement to this Agreement or any of the other Loan Documents.
None of the other Loan Parties shall enter into any agreement or any purchase
money mortgages or financing leases which prohibits or requires the consent of
any Person to any amendment, modification or supplement to this Agreement or any
of the other Loan Documents.
5.18. Government Regulation. The Loan Parties shall not, and shall not permit
any of their respective Subsidiaries to, (a) be or become subject at any time to
any law, regulation, or list of any government agency (including, without
limitation, the U.S. Office of Foreign asset Control list) that prohibits or
limits the Lender from making any advance or extension of credit to the Borrower
or from otherwise conducting business with the Loan Parties, or (b) fail to
provide documentary and other evidence of the identity of the Loan Parties as
may be requested by the Lender at any time to enable the Lender to verify the
identity of the Loan Parties or any of their respective Subsidiaries or to
comply with any applicable law or regulation, including, without limitation,
Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318.
SECTION VI.
General Conditions Of Borrowing
6.1. Closing Proceedings. The making of the initial advance under the Loans
shall be subject to the following conditions, in addition to those stated in
Section II of this Agreement, which shall each have been and remain at the time
satisfied by the Borrower or waived by the Lender:
(a) This Agreement shall have been duly and validly executed and delivered by
the Borrower and the Lender and the Borrower shall have duly and validly
executed and delivered or caused to be executed and delivered to the Lender the
Notes, the Collateral Documents, and all other Loan Documents, and each
Collateral Document which is to be filed or recorded shall have been properly
filed or recorded and the fees and Taxes, if any, for filing or recording the
same shall have been paid by the Borrower.
(b) The Borrower must cause to be delivered to the Lender, at the Loan Parties’
expense, a written statement setting forth an opinion of the market value of the
Titusville Facility that (i) has been independently and impartially prepared by
a qualified appraiser directly engaged by the Lender or its agent, (ii) complies
with all applicable federal and state laws and regulations, as well as the
Lender’s internal policies, dealing with appraisals or valuations of real
property, and (iii) has been reviewed as to form and content and approved by the
Lender, in its sole discretion.

 

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(c) The Borrower must cause to be delivered to the Lender a written
environmental audit or assessment in favor of the Lender with respect to the
Titusville Facility, conducted by an engineering firm reasonably acceptable to
the Lender, conforming at a minimum to the ASTM-E1527-05 standards, with such
additional non-scope inquiries as the Lender may reasonably require, and
containing no information deemed to be unacceptable to the Lender in its sole
discretion.
(d) The Borrower must cause to be delivered to the Lender a survey (the
“Survey”) of the Titusville Facility by a licensed surveyor who is reasonably
acceptable to Lender, showing the location of the improvements and the usual and
customary information disclosed by a proper survey and such other information as
Lender may reasonably require. The Survey must be duly certified as accurate by
the surveyor and must reflect that none of the improvements encroach upon a
street or any adjoining property and that no adjoining structure encroaches upon
the Property. The Survey must also show that there is no violation of building
lines or restrictions.
(e) The Borrower must cause to be delivered to the Lender an ALTA Loan Policy of
Title Insurance insuring that the lien created by the Mortgage constitutes a
valid lien on the Titusville Facility and has the dignity and priority required
by the Lender. The form and substance of the policy must be reasonably
satisfactory to Lender in all respects.
(f) The Borrower shall have opened its principal depository and operating
accounts with the Lender and the aggregated deposits on the Closing Date shall
be no less than $750,000.00.
(g) The Borrower shall have entered into an IDIQ contract with NASA for
commercial payload processing support for expendable launch vehicles and evolved
expendable launch vehicles from Cape Canaveral Air Force Station and from the
Eastern Range in Florida, on terms reasonably satisfactory to the Lender, and
shall have furnished a true and correct copy of such contract to the Lender.
(h) No event shall have occurred which could reasonably be expected to have a
Material Adverse Effect since June 30, 2010.
(i) Each Loan Party shall have delivered or caused to be delivered to the Lender
in Proper Form the following:
(i) Resolutions of its Board of Directors certified by its Secretary, which
resolutions shall authorize the execution, delivery and performance by the Loan
Party of this Agreement and the other Loan Documents to which the respective
Loan Party is a party and which shall authorize the consummation and performance
of the transactions contemplated hereby and thereby;
(ii) A certificate of incumbency certified by its President and Secretary with
specimen signatures of its President, Vice President, Treasurer, Secretary and
other officers who will sign this Agreement or any of the other Loan Documents
in connection herewith and delivered pursuant hereto;

 

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(iii) Articles of Incorporation or Organization certified as of a recent date by
the Secretary of the State of its incorporation;
(iv) By-laws certified by its Secretary; and
(v) Certificates of the appropriate government officials of the State of its
organization and each State where it is authorized to transact business each
bearing a recent date, to the effect that the respective Loan Party is so
organized and authorized and in good standing.
(j) The Lender shall have received evidence satisfactory to it that the
Collateral is all owned by the Borrower and Holdings free and clear of any Liens
(other than Permitted Liens) and, in the event any such Liens do exist, then the
Lender shall have received written releases or subordination agreements in
Proper Form executed by each Person in whose favor a Lien exists.
(k) The Lender shall have received payment of all fees and reimbursement of all
reasonable attorneys’ fees and expenses incurred through the Closing Date by the
Lender in connection with the preparation, negotiation and consummation of the
loan transaction evidenced by this Agreement and the other Loan Documents.
(l) The Borrower shall have obtained and furnished to the Lender evidence of the
existence of insurance and endorsements thereto as required pursuant to the
provisions of Section 4.12 hereof and shall have paid all premiums therefor.
(m) The Lender shall have completed all due diligence deemed necessary in its
sole discretion, and all such information revealed in connection with such due
diligence shall be acceptable to the Lender in its sole discretion.
(n) No Default nor Event of Default shall then exist.
(o) All proceedings to be taken in connection with the transactions contemplated
by this Agreement and the other Loan Documents and all documents incident hereto
or thereto, and all actions necessary to evidence, create, and perfect the
security interests contemplated hereby, shall have been taken and be in Proper
Form and the Lender shall have received copies of all documents which it may
reasonably request in connection with such transactions and all corporate
proceedings with respect thereto, in Proper Form. Without limiting the
generality of the provisions of Section 6.1, for purposes of determining
compliance with the conditions specified in this Section 6.1, when Lender has
signed this Agreement it shall be deemed to have consented to, approved or
accepted or to be satisfied with, each document or other matter required
thereunder to be consented to or approved by or acceptable or satisfactory to
the Lender unless the Borrower shall have received notice from the Lender prior
to the proposed Closing Date specifying its objection thereto

 

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6.2. Conditions to Subsequent Advances The making of the advances under the
Revolving Credit subsequent to the Closing Date shall be subject to the
following conditions, in addition to those stated in Section II of this
Agreement, which shall each have been and remain at the time satisfied by the
Borrower or waived by the Lender:
(a) The Lender shall have received the written Loan request and Borrowing Base
Certificate required by the provisions of Section 2.1 in accordance with the
requirements thereof.
(b) No event shall have occurred which could reasonably be expected to have a
Material Adverse Effect since June 30, 2010.
(c) No event shall have occurred and then be continuing (or would occur after
giving effect to the Loans) which constitutes (or would constitute after giving
effect to the requested advance) an Event of Default or Default.
(d) Each and all of the representations and warranties of the Loan Parties in
this Agreement and the other Loan Documents shall be true, correct and accurate
as of the date the advance under the Revolving Credit is requested as if made as
of such date, except to the extent such representations and warranties
specifically refer to an earlier date.
(e) A certificate confirming the facts set forth in paragraphs (b), (c) and
(d) signed by a Principal Officer of the Borrower shall be delivered to the
Lender
6.3. Sole Benefit of Lender. All conditions precedent to the obligation of the
Lender to make the Loans are imposed hereby solely for the benefit of the Lender
and no other party may require satisfaction of any such condition precedent or
be entitled to assume that the Lender will refuse to make the Loans in the
absence of strict compliance with such conditions precedent. Any requirement of
this Agreement may be waived by the Lender, in whole or in part, at any time.
Any requirement herein of submission of evidence of the existence or
non-existence of a fact shall be deemed, also, to be a requirement that the fact
shall exist or not exist, as the case may be, and without waiving any condition
or obligation of the Borrower, the Lender may at all times independently
establish to its satisfaction such existence or non-existence.
SECTION VII.
Events Of Default And Remedies
7.1. Events. Any of the following events which shall occur and be continuing for
any reason whatsoever, whether voluntary or involuntary, by operation of law or
otherwise, shall be considered an Event of Default as that term is used herein:
(a) The Borrower shall fail to pay any principal, interest, fees or other
amounts payable under any of the Loan Documents within five (5) Business Days of
the due date.
(b) Any representation or warranty made or deemed made by any of the Loan
Parties (or any of their respective officers) under or in connection with any
Loan Documents shall have been materially incorrect or misleading in any
material respect when made or deemed made.

 

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(c) The Borrower shall fail to perform or comply with any term or covenant
contained in Section V hereof.
(d) The Borrower shall fail to perform or comply with any other term or covenant
contained in any Loan Documents, other than those described in subsections
(a) and (c) above, and such failure shall not be remedied within twenty
(20) days following the earlier of Knowledge thereof by a Loan Party, or of
written notice by the Lender to the Borrower.
(e) Any of the Loan Documents or any material provision thereof shall, for any
reason, not be valid and binding on any of the Loan Parties or any other party
thereto; or any of the above shall not be in full force and effect, or shall be
declared to be null and void; or the validity or enforceability of any of the
Loan Documents shall be contested by any of the Loan Parties, or by any
Affiliate of any thereof, or any other party thereto (other than the Lender);
any Loan Party to any thereof shall deny that it has any or further liability or
obligation under its respective Loan Documents or shall revoke or terminate or
attempt to revoke or terminate the same; or any of the Subordination Agreements
or any subordination provisions of any agreement or instrument governing any
Subordinated Debt is for any reason revoked or invalidated, or otherwise cease
to be in full force and effect, any Person party thereto contests in any manner
the validity or enforceability thereof or denies that it has any further
liability or obligation thereunder; or the Indebtedness is for any reason
subordinated or does not have the priority contemplated by the provisions of
this Agreement or any of the Subordination Agreements or any such subordination
provisions.
(f) Any of the Loan Parties shall (i) make a general assignment for the benefit
of creditors, or (ii) apply for or consent to the appointment of, or allow to be
appointed, a custodian, receiver, a trustee or liquidator of itself or of all or
a substantial part of its assets, or (iii) file a petition for relief under or
be the subject of an order for relief entered pursuant to a petition filed
under, any bankruptcy or similar statute (whether Federal or State) relating to
relief of debtors; or (iv) be the subject of any petition for relief filed
against it under any bankruptcy or similar statute (whether Federal or State)
relating to relief of debtors which shall not be vacated or dismissed within
sixty (60) days after the filing thereof; or (v) dissolve, liquidate,
reorganize, or be acquired by any Person(s).
(g) Any of the Loan Parties shall fail to pay any Debt of $500,000.00 or more
(individually or in the aggregate) when due (whether by scheduled maturity,
required prepayment, acceleration, demand, or otherwise), and such failure,
shall continue after the applicable grace period, if any, specified in the
agreement or instrument relating to such Debt; any Loan Party shall fail to
perform or observe any term or covenant contained in any agreement or instrument
relating to any such Debt, when required to be performed or observed, and such
failure shall continue after the applicable grace period, if any, specified in
such agreement or instrument, or can result in acceleration of the maturity of
such Debt; or any such Debt shall be declared to be due and payable, or required
to be prepaid (other than by a regularly scheduled required prepayment), prior
to the stated maturity thereof.

 

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(h) Any party shall commence any action, suit or proceeding against or affecting
any Loan Party or any part of the Collateral or involving the validity or
enforceability of this Agreement or any of the other Loan Documents or the
priority of the Liens created by any of the other Loan Documents, at law or in
equity, or before any Governmental Authority, which materially impairs or would
materially impair Lender’s interest in any material part of the Collateral, the
enforceability of this Agreement or any of the other Loan Documents or the
Lender’s ability to collect the Indebtedness when due or to enforce the
Obligations.
(i) There shall occur any Change of Control.
(j) The Borrower or any member of its Controlled Group shall have been notified
by the sponsor of a Plan that (i) it has Unfunded Liabilities to such Plan in an
amount that, when aggregated with all other amounts required to be paid to Plans
in connection with Unfunded Liabilities, exceeds $25,000.00 or requires payments
exceeding $25,000.00 per annum, or (ii) such Plan is in reorganization or is
being terminated, within the meaning of Title IV of ERISA, if as a result
thereof the aggregate annual contributions to all Plans in reorganization or
being terminated is increased over the amounts contributed to such Plans for the
preceding Plan year by an amount exceeding $25,000.00.
(k) The Borrower or Holdings shall be required under any Environmental Law
(i) to implement any remedial, neutralization, or stabilization process or
program, the cost of which could reasonably be expected to have a Material
Adverse Effect, or (ii) to pay any penalty, fine, or damages in an aggregate
amount of $500,000.00 or more (in excess of insurance).
(l) There shall occur judgments or fines (including, without limitation,
pursuant to any civil or criminal action brought by any Governmental Authority)
the Borrower or Holdings in the aggregate in excess of $500,000.00 at any one
time outstanding that are either uninsured or for which the insurer fails to pay
for more than 60 days and which are either final and unappealable or remain
uncontested by the Borrower or Holdings;
(m) The Borrower or Holdings shall fail to obtain or maintain any license,
permit or other authorization required to be obtained or maintained in
connection with the use of its Property or conduct of its business, if the
failure to obtain or maintain the same could reasonably be expected to have a
Material Adverse Effect.
(n) Any Material Customer Agreement, lease, contract, permit, license or
authorization of the Borrower shall terminate or cease to be effective, which
termination or cessation could reasonably be expected to have a Material Adverse
Effect.
7.2. Remedies. Upon the happening of any Default, the Lender may, at its option
and without notice, suspend any agreement to advance funds hereunder, without
limiting its rights set out elsewhere in this Agreement as to the Loans
hereunder. Upon the happening of any Event of Default, Lender may, at its option
and without further notice:

 

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(a) Cancel any agreement to advance funds hereunder without limiting its rights
set out elsewhere in this Agreement as to loans hereunder;
(b) Declare the entire outstanding aggregate principal amount of the Notes (or
any thereof) then outstanding hereunder, and the unpaid interest accrued
thereon, immediately due and payable without notice and without presentment,
demand, protest, or other notice, whether of default, intent to accelerate,
acceleration or dishonor, or of any kind, all of which are hereby expressly
waived by the Borrower;
(c) Pursue any other right or remedy pursuant to this Agreement, the Notes, the
other Loan Documents or provided by law; or
(d) Foreclose or seek to foreclose, by private or public sale, or by judicial or
non-judicial means, any Collateral; or
(e) Exercise or pursue any one or more of the foregoing rights or remedies at
any time or times, without prejudice to (or election as to) the exercise of any
other rights(s), remedy or remedies thereafter, or concurrently therewith.
7.3. Cumulative Rights. All rights available to the Lender under the Loan
Documents shall be cumulative of and in addition to all other rights granted
thereto at law or in equity, whether or not amounts owing thereunder shall be
due and payable, and whether or not the Lender shall have instituted any suit
for collection or other action in connection with the Loan Documents.
7.4. Waivers. The acceptance by the Lender at any time and from time to time of
partial payment of any amount owing under any Loan Documents shall not be deemed
to be a waiver of any Event of Default then existing. No waiver by the Lender of
any Event of Default shall be deemed to be a waiver of any Event of Default
other than such Event of Default. No delay or omission by the Lender in
exercising any right under the Loan Documents shall impair such right or be
construed as a waiver thereof or an acquiescence therein, nor shall any single
or partial exercise of any such right preclude other or further exercise
thereof, or the exercise of any other right under the Loan Documents or
otherwise.
SECTION VIII.
Miscellaneous
8.1. Survival of Various Matters. All covenants and agreements herein not fully
performed before the date of this Agreement shall survive such date.
8.2. Notices. All notices, requests and communications hereunder shall be in
writing and shall be deemed to have been duly given to a party when delivered in
person (including delivery by an express delivery service or by facsimile
transmission during the recipient’s regular business hours) to the officer of
the Borrower or of the Lender, respectively, named below, or two Business Days
after such notice is enclosed in a properly sealed envelope, certified or
registered, and deposited (postage and certification or registration prepaid) in
a post office or collection facility regularly maintained by the United States
Postal Service and addressed as follows:

 

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If to Lender:
American Bank, N.A.
3250 Bee Caves Road, Suite 100
Austin, Texas 78746
Attn: Dan Leonard
Fax: 512.328.1200
With a copy (which shall not constitute notice) to:
Graves, Dougherty, Hearon & Moody, P.C.
401 Congress Avenue, Suite 2200
Austin, Texas 78701
Attn: Roy C. Snodgrass III
Fax: 512.480.5852
If to Borrower:
Astrotech Space Operations, Inc.
401 Congress Avenue, Suite 1650
Austin, Texas 78701
Attn: Charles N. York, II
Fax: 512.485.9531
Astrotech Florida Holdings, Inc.
401 Congress Avenue, Suite 1650
Austin, Texas 78701
Attn: Charles N. York, II
Fax: 512.485.9531
Astrotech Corporation
401 Congress Avenue, Suite 1650
Austin, Texas 78701
Attn: Charles N. York, II
Fax: 512.485.9531
With a copy (which shall not constitute notice) to:
Baker Botts LLP
1500 San Jacinto Center
Austin, Texas 78701-4078
Attn: Mike Bengtson, Partner
Fax: 512.322.8349
Any party may, by proper written notice hereunder to the other parties, change
the address or the officer to which notices shall thereafter be sent to it.
Anything herein to the contrary notwithstanding, loan requests required by the
provisions of Section 2.1(b) hereof shall be effective only upon actual receipt
thereof and copies need not be provided as set forth above.

 

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8.3. Control. None of the covenants or other provisions contained in this
Agreement shall, or shall be deemed to, give the Lender rights to exercise
control over the affairs or management of the Loan Parties or any of their
Subsidiaries, the power of the Lender being limited to the rights to exercise
the remedies provided in the Loan Documents; provided, however, that if the
Lender becomes the owner of any stock or other equity interest in any Person,
whether through foreclosure or otherwise, it shall be entitled to exercise such
legal rights as it may have by being an owner of such stock or other equity
interest in such Person.
8.4. Successors and Assigns. All covenants and agreements herein contained by or
on behalf of the Loan Parties and the Lender shall bind their respective
successors and assigns and shall inure to the benefit of the Loan Parties and
the Lender and their respective successors and assigns; provided, however, that
the Loan Parties shall not have the right to assign their rights hereunder or
any interest herein without the prior written consent of the Lender. The Lender
reserves the right to sell or assign all or any portion of the Indebtedness and
Obligations and to grant one or more participations in the Indebtedness and
Obligations. Without limiting its rights under this Section, the Lender may
make, carry or transfer the Loans at, to or for the account of any of its branch
offices. The Lender may, in connection with any participation or proposed
participation, disclose to the participant or proposed participant any
information relating to the Loan Parties furnished to the Lender by or on behalf
of a Loan Party, subject to the provisions of Section 8.6 hereof. Any other
provision set forth in this Agreement, to the contrary notwithstanding, Lender
may at any time create a security interest in all or any portion of its rights
under this Agreement (including, without limitation, the Indebtedness and any
promissory note held by it) in favor of any Federal Reserve Bank in accordance
with Regulation A of the Board of Governors of the Federal Reserve System.
8.5. Renewals. All provisions of this Agreement relating to the Notes shall
apply with equal force and effect to each and all promissory notes hereafter
executed which in whole or in part represent a renewal, extension, consolidation
or rearrangement of any part of the indebtedness originally represented by the
Notes.
8.6. Confidentiality.
(a) The Lender agrees to keep all non-public information provided to it by the
Loan Parties as confidential in accordance with its customary procedures;
provided that nothing herein shall prevent the Lender from disclosing any such
information:
(i) to its employees, directors, agents, attorneys, accountants and other
professional advisors or those of any of its affiliates;
(ii) to any regulatory authority having jurisdiction over the Lender and its
examiners;
(iii) upon the request or demand of any Governmental Authority;
(iv) in response to any order of any court or other Governmental Authority or as
may otherwise be required pursuant to any applicable law;

 

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(v) if requested or required to do so in connection with any litigation or
similar proceeding;
(vi) as the Lender may determine in connection with the exercise of any remedies
hereunder or under any other Loan Documents or any suit, action or proceeding
relating to this Agreement or any other Loan Document or the enforcement of its
rights hereunder or thereunder;
(vii) to any other party hereto;
(viii) in connection with any prospective merger or acquisition of the Lender;
(ix) that has been publicly disclosed;
(x) subject to an agreement containing provisions substantially the same as
those of this Section 8.6, to any actual or potential assignee, transferee or
participant in connection with the assignment or transfer by the Lender of any
Loans or any participations therein; or
(xi) with the consent of a Loan Party.
(b) Any Person required to maintain the confidentiality of non-public
information provided by the Loan Parties as provided in this Section 8.6 shall
be considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
information as such Person would accord to its own confidential information.
8.7. No Waiver. No course of dealing on the part of the Lender or its officers
or employees or any failure or delay by the Lender with respect to exercising
any right, power or privilege of the Lender under this Agreement, the Notes or
other Loan Documents shall operate as a waiver thereof. The rights and remedies
of the Lender shall be cumulative and the exercise or partial exercise of any
such right or remedy shall not preclude the exercise of any other right or
remedy.
8.8. Governing Law. This Agreement, the Notes and the other Loan Documents shall
be deemed to be contracts made under and shall be construed in accordance with
and governed by the laws of the State of Texas (except that the Mortgage shall
be governed by the laws of the State of Florida), except as federal law may
apply. The Loan Parties irrevocably agree that any cause of action brought to
enforce or interpret the provisions of this Agreement, the Notes or any of the
other Loan Documents shall be brought in the district courts of Travis County,
Texas or in the United States District Court for the Western District of Texas
(Austin Division).
8.9. Non-Subordination. The Notes shall never be in a position subordinate to
any indebtedness owing to any other creditor of the Borrower.

 

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8.10. Exhibits and Schedules. The Exhibits and Schedules attached to this
Agreement are incorporated herein for all purposes and shall be considered a
part of this Agreement. In the event of any conflicts or inconsistencies, the
terms and provisions of this Agreement shall control.
8.11. Payment on Non-Business Days. Whenever (i) any payment to be made
hereunder or under any of the Notes or (ii) any certificate, report or financial
statement is due on a day that is not a Business Day, such payment shall be made
on the next succeeding Business Day and such extension of time shall be included
in the computation of interest due with such payment.
8.12. Severability. In the event any one or more of the provisions contained in
this Agreement or in the Notes, or in any of the other Loan Documents or any
other instrument referred to herein or executed in connection with or as
security for the Notes shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provision of this Agreement, the Notes, the other
Loan Documents or any other instrument referred to herein or executed in
connection with or as security for either of the Notes. Furthermore, in lieu of
such an illegal, invalid or unenforceable provision, there shall be added
automatically as part of this Agreement, the Notes or any other Loan Document,
as the case may be, a provision as similar in terms to such illegal, invalid or
unenforceable provision as may be possible and be legal, valid or enforceable.
8.13. Savings Clause. It is not the intention of any party to any of the Loan
Documents to make an agreement violative of the laws of any applicable
jurisdiction relating to usury. Regardless of any provision in any of the Loan
Documents, the Lender shall never be entitled to receive, collect or apply, as
interest on the Indebtedness or Obligations, any amount which would cause the
interest rate thereon to exceed the Maximum Lawful Rate. If Lender ever
receives, collects or applies, as interest, any such excess, such amount which
would be excessive interest shall be deemed a partial repayment of principal and
treated hereunder as such; and if principal is paid in full, any remaining
excess shall be paid to the Borrower. In determining whether or not the interest
paid or payable, under any specific contingency, would cause the interest rate
to exceed the Maximum Lawful Rate, the Borrower and the Lender shall, to the
maximum extent permitted under applicable laws, (i) characterize any
nonprincipal payment as an expense, fee or premium rather than as interest,
(ii) exclude voluntary prepayments and the effect thereof, and (iii) amortize,
prorate, allocate and spread in equal parts, the total amount of interest among
all of the Loans throughout the entire contemplated term of the Loans so that
the interest rate is uniform throughout the entire term of the Loans; provided
that if the Indebtedness or Obligations are paid and performed in full prior to
the end of the full contemplated term thereof, and if the interest received for
the actual period of existence thereof would cause the interest rate to exceed
the Maximum Lawful Rate, the Lender shall refund to the Borrower the amount of
such excess or credit the amount of such excess against the total principal
amount owing, and, in such event, Lender shall not be subject to any penalties
provided by any laws for contracting for, charging or receiving interest in
excess of the Maximum Lawful Rate. This Section 8.13 shall control every other
provision of all agreements among the parties to this Agreement pertaining to
the transactions contemplated by or contained in any of the Loan Documents.

 

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8.14. Counterparts. To facilitate execution, this Agreement and the other Loan
Documents may be executed in any number of counterparts as may be convenient or
necessary, and it shall not be necessary that the signatures of all parties
hereto or thereto be contained on any one counterpart hereof or thereof.
Additionally, the parties hereto agree that for purposes of facilitating the
execution of this Agreement and the other Loan Documents, (a) the signature
pages taken from separate individually executed counterparts of this Agreement
and the other Loan Documents may be combined to form multiple fully executed
counterparts and (b) a facsimile transmission shall be deemed to be an original
signature. All executed counterparts of this Agreement and the other Loan
Documents shall be deemed to be originals, but all such counterparts taken
together or collectively, as the case may be, shall constitute one and the same
agreement.
8.15. Limitation of Remedies. Anything contained in this Agreement and anything
contained in the other Loan Documents to the contrary notwithstanding, in the
event that the Lender (i) fails or refuses to grant consent or approval when
required by applicable law or when required hereunder or under any of the other
Loan Documents for any matter or (ii) acts unreasonably or unreasonably
withholds or delays acting in any circumstances where by law or hereunder or
under any of the other Loan Documents there is an obligation to act reasonably
or promptly (it being agreed that no such obligation is implied) the parties
agree that the damages which might arise as a result of any such actions or
inactions are incapable of accurate determination. Accordingly, the parties
agree that the remedies of specific performance and injunctive relief are and
shall be the sole and exclusive remedies and relief of the Loan Parties with
respect to such actions against the Lender, and the Loan Parties hereby
irrevocably and unconditionally waive all claims for damages with respect
thereto. Neither the Lender, nor any Affiliate, officer, director, employee,
attorney, or agent of the Lender shall have any liability with respect to, and
the Loan Parties, hereby waive, release, and agree not to sue any of them upon,
any claim for any special, indirect, incidental, or consequential damages
suffered or incurred by any Loan Party or any Subsidiary of any Loan Party in
connection with, arising out of, or in any way related to, this Agreement or any
of the other Loan Documents, or any of the transactions contemplated by this
Agreement, any of the other Loan Documents. The Loan Parties hereby waive,
release, and agree not to sue the Lender or any of the Lender’s Affiliates,
officers, directors, employees, attorneys, or agents for punitive damages in
respect of any claim in connection with, arising out of, or in any way related
to, this Agreement or any of the Notes, or any of the other Loan Documents.
8.16. Headings. The headings of the sections of this Agreement are inserted for
convenience only and shall not be deemed to constitute a part hereof.
8.17. No Obligation to Make Advance. No advances need be made by the Lender
under this Agreement or the Notes if such loan or advance should cause the
Lender to be in violation of any law, rule, regulation or interpretation of a
governmental body applicable to the Lender. The Lender’s obligation to make any
loan or advance hereunder shall be deemed to be pursuant to a contract to make a
loan or extend debt financing or financial accommodations to the Borrower within
the meaning of Subsections 365(c)(2) and 365(e)(2)(B) of the Bankruptcy Code.

 

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8.18. Role of Lender. Any term or condition hereof, or of any of the other Loan
Documents to the contrary notwithstanding, the Lender shall not have, and by its
execution and acceptance of this Agreement hereby expressly disclaims, any
obligation or responsibility for the management, conduct or operation of the
business and affairs of the Loan Parties, and any term or condition hereof, or
of any of the other Loan Documents, permitting the Lender to disburse funds,
whether from the proceeds of the Loans, or otherwise, or to take or refrain from
taking any action with respect to the Loan Parties, the Collateral or any other
security for repayment of the Loans, shall be deemed to be solely to permit the
Lender to audit and review the management, operation and conduct of the business
and affairs of the Loan Parties, and to maintain and preserve the security given
by the Loan Parties to the Lender for the Loans and may not be relied upon by
any other person. Further, the Lender shall not have, has not assumed and, by
its execution and acceptance of this Agreement, hereby expressly disclaims any
liability or responsibility for the repayment or performance of any indebtedness
or obligation of the Loan Parties, and no condition hereof, or of any of the
other Loan Documents, shall be construed so as to deem the relationship between
the Loan Parties and the Lender to be other than that of Loan Parties and
lender, and the Loan Parties shall at all times represent that the relationship
between the Borrower and the Lender is solely that of Loan Parties and lender.
The Loan Parties hereby jointly and severally indemnify and agree to hold the
Lender harmless from and against any costs, expenses and liabilities incurred or
suffered by the Lender as a result of any assertion or claim of any obligation
or responsibility of the Lender for the management, operation and conduct of the
business and affairs of the Loan Parties, or as a result of any assertion or
claim of any liability or responsibility of the Lender for the payment or
performances of any indebtedness or obligation of the Loan Parties. No provision
in this Agreement or of any of the other Loan Documents and no course of dealing
between the parties shall be deemed to create any fiduciary duty by the Lender
to the Loan Parties or any of their Subsidiaries.
8.19. Chapter 346 of the Texas Finance Code. The provisions of Chapter 346 of
the Texas Finance Code are specifically declared by the parties hereto to not be
applicable to this Agreement or the transactions contemplated hereby.
8.20. Waiver of Consumer Rights. The Borrower and each other Loan Party
represents and warrants that it (a) is seeking or acquiring by purchase or lease
goods or services for a commercial or business use and (b) has assets of
$25,000,000.00 or more or is owned or controlled by a corporation or entity with
assets of $25,000,000.00 or more.
THE BORROWER AND EACH OTHER LOAN PARTY WAIVES ITS RIGHTS UNDER THE DECEPTIVE
TRADE PRACTICES-CONSUMER PROTECTION ACT, SECTION 17.41 ET SEQ., BUSINESS &
COMMERCE CODE, A LAW THAT GIVES CONSUMERS SPECIAL RIGHTS AND PROTECTIONS. AFTER
CONSULTATION WITH AN ATTORNEY OF BORROWER’S AND GUARANTOR’S OWN SELECTION,
BORROWER AND EACH OTHER LOAN PARTY VOLUNTARILY CONSENTS TO THIS WAIVER.
8.21. NO OTHER AGREEMENTS. THIS AGREEMENT, THE NOTES AND THE OTHER LOAN
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.

 

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8.22. WAIVER OF JURY. THE LENDER AND THE LOAN PARTIES HEREBY IRREVOCABLY WAIVE
ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTER-CLAIM, ARISING
OUT OF OR RELATED TO THIS AGREEMENT, THE NOTES, AND THE OTHER LOAN DOCUMENTS OR
THE ACTIONS OF THE LENDER IN THE ENFORCEMENT THEREOF OR WITH RESPECT TO THE
TRANSACTIONS CONTEMPLATED BY THE PROVISIONS THEREOF.
8.23. No Duty. All attorneys, accountants, appraisers, and other professional
Persons and consultants retained by the Lender shall have the right to act
exclusively in the interest of the Lender and shall have no duty of disclosure,
duty of loyalty, duty of care, or other duty or obligation of any type or nature
whatsoever to the Loan Parties or any of the shareholders or Subsidiaries of the
Loan Parties.
8.24. USA Patriot Act Notification. The following notification is provided to
the Loan Parties pursuant to Section 326 of the USA Patriot Act of 2001, 31
U.S.C. Section 5318:
The Lender hereby notifies the Loan Parties that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) (the “Act”), it is required to obtain, verify and record information that
identifies the Loan Parties, which information includes the name and address of
the Loan Parties and other information that will allow the Lender to identify
the Loan Parties in accordance with the Act.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly
executed in multiple counterparts, each of which is an original instrument for
all purposes, all as of the day and year first above written.

            BORROWER:

Astrotech Space Operations, Inc.,
a Delaware corporation
      By:   /s/ John M. Porter         John M. Porter,        Senior Vice
President        PARENT:

Astrotech Corporation,
a Washington corporation
      By:   /s/ John M. Porter         John M. Porter,        Senior Vice
President   

 

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            HOLDINGS:

Astrotech Florida Holdings, Inc.,
a Florida corporation
      By:   /s/ John M. Porter         John M. Porter,        Senior Vice
President        LENDER:

American Bank, N.A.
      By:   /s/ Daniel Leonard         Name:   Daniel Leonard        Title:  
Senior Lending Officer     

Signature Page to Loan Agreement

 

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FORM OF
REVOLVING PROMISSORY NOTE

          $3,000,000.00   Austin, Texas   October 21, 2010

This Promissory Note (the “Note”) is executed pursuant to the terms of that
certain Loan Agreement (as the same may be amended, modified restated or
replaced, the “Loan Agreement”) dated of even date herewith by and among
Astrotech Space Operations, Inc., a Delaware corporation (the “Borrower”),
Astrotech Corporation, a Washington corporation (the “Parent”), Astrotech
Florida Holdings, Inc., a Florida corporation (“Holdings” and, collectively,
with the Borrower and the Parent, the “Loan Parties”), and American Bank, N.A.
(the “Lender”). Advances to be made hereunder by the Lender shall be made in
reliance upon each and all of the terms, conditions, representations,
warranties, covenants and agreements of the Loan Agreement. In no event will the
Lender have any obligation to advance any proceeds of this Note unless the Loan
Parties fully satisfy all conditions thereto set forth in the Loan Agreement.
For value received, the Borrower promises to pay to the order of the Lender at
the location provided for payments in the Loan Agreement (or at such other place
as the Lender may hereafter direct the Borrower), the principal sum of THREE
MILLION AND 00/100 DOLLARS ($3,000,000.00), or the aggregate amount of all
unpaid advances made hereunder, whichever is the lesser, together with interest
on the outstanding portion thereof for the period such sums are unpaid, as
hereinafter provided.
1. Defined Terms. Capitalized terms which are used in this Note and are not
otherwise defined are used with the meanings provided for them in the Loan
Agreement, unless the context clearly requires otherwise. In addition, the
following terms shall have the following meanings:
(a) “Base Rate” means, for any day, a fluctuating interest rate per annum as
shall be in effect from time to time which rate per annum shall at all times be
equal to the rate established from time to time by the Lender as its base rate
for the guidance of its loan officers, whether or not publicly announced. The
Base Rate is set by the Lender as a general reference rate of interest, taking
into account such factors as the Lender may deem appropriate, it being
understood that many of the Lender’s commercial or other loans are not priced in
relation to such rate, that it is not necessarily the lowest or best rate
actually charged to any customer, that the Lender may make various commercial or
other loans at rates of interest having no relationship to such rate, and that
rates on other loans or credit facilities may be based on indicates other than
the Base Rate.
(b) “Loan” means the loan evidenced by the terms hereof.
(c) “Loan Parties” means, collectively, the Borrower, the Parent and Holdings.
EXHIBIT A
TO
LOAN AGREEMENT

 

 

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(d) “Loan Rate” means a varying rate per annum equal to the lower of (a)
one-quarter of one percent (0.25%) per annum in excess of the Base Rate, but in
no event less than four percent (4.00%) per annum, and (b) the Maximum Lawful
Rate. The rate per annum at which interest accrues hereunder may be adjusted by
the Lender without notice to the Borrower on the effective date of any change in
the Base Rate or the Maximum Lawful Rate, as the case may be. The Lender’s
determinations shall be deemed conclusive, absent manifest error.
(e) “Payment Date” means the 21st day of each month (or the last day of any
month which does not include a numerically corresponding day), beginning
November 21, 2010.
(f) “Revolving Credit Maturity Date” means October 21, 2012.
2. Repayment of Principal and Interest. This Note is due and payable as follows:
Interest only shall be due and payable monthly as it accrues on each Payment
Date from the date hereof until the Revolving Credit Maturity Date, when the
entire amount hereof, principal and interest then remaining unpaid, shall be due
and payable in full.
3. Interest Rate. Interest on the outstanding balance hereof shall accrue prior
to maturity at a varying rate per annum equal to the Loan Rate, subject to the
provisions of Section 19 below.
4. Default Interest. The Borrower shall pay Default Interest as provided in the
Loan Agreement.
5. Interest Recoupment. To the fullest extent provided by applicable law, if at
any time and from time to time the Lender is prevented from collecting the rate
of interest and the fees specified in this Note by applicable law or
governmental regulation, the Lender shall be entitled to recoup the amount it
would have otherwise been able to collect (the “Recoupment Amount”) during such
period when the recoupment will not violate such applicable law or regulation
(the “Recoupment Period”). During each Recoupment Period, the Borrower shall
continue to pay the Maximum Lawful Rate until there has been paid hereon, in
addition to the interest at the applicable rate specified herein during such
Recoupment Period, an amount equal to the Recoupment Amount. Interest collected
by the Lender during each Recoupment Period shall first be applied to payment of
current interest due at the applicable rate specified in this Note and any
remaining interest collected shall be applied to the Recoupment Amount. When the
Lender shall have recouped all of the Recoupment Amount, the interest rate
payable by the Borrower shall revert to the applicable rate specified in this
Note. In no event, however, shall the interest rate charged hereunder ever
exceed the Maximum Lawful Rate and in the event of any prepayment hereof, only
that portion of the Recoupment Amount which has been earned through the date of
prepayment shall be payable.
EXHIBIT A
TO
LOAN AGREEMENT

 

 

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6. Reborrowing Principal. The Borrower may borrow, repay and reborrow funds
hereunder from time to time prior to the Revolving Credit Maturity Date as
provided in the Loan Agreement.
7. Events of Default. If any one or more of the Events of Default shall occur
for any reason whatsoever (and whether such occurrence shall be voluntary or
involuntary or come about or be effected by operation of law pursuant to or in
compliance with any judgment, decree or order of any court, or any order, rule
or regulation of any administrative or governmental body, or otherwise), then,
and in such event, and at any time thereafter, the holder of this Note may, at
its option without demand or notice to the Borrower which the Borrower expressly
waives, declare the outstanding principal and accrued interest owing under this
Note to be immediately due and payable, whereupon the entire unpaid principal
and accrued interest of this Note shall forthwith become and be due and payable.
8. Extension of Due Date. If the payment of principal or interest to be made on
this Note shall become due on a day other than a Business Day, such payment may
be made on the next succeeding Business Day (unless the result of such extension
of time would be to extend the date for such payment beyond the maturity date
hereof, in which event the payment shall be made on the Business Day immediately
preceding the day on which such payment would otherwise have been due).
9. Collateral Documents. Payment of this Note is secured by, and this Note is
entitled to the benefits of, each of the Collateral Documents.
10. General Waivers. The Borrower waives presentment for payment, demand, notice
of intent to accelerate, notice of acceleration, protest and notice of protest,
and of dishonor, diligence in collecting and the bringing of suit against any
other party, and agrees to all renewals, extensions, partial payments, releases,
subordinations and substitutions of security, in whole or in part, with or
without notice, before or after maturity. The failure by the Lender to exercise
any of its rights, remedies, recourses, or powers upon the occurrence of one or
more of the Events of Default shall not constitute a waiver of the right to
exercise the same or any other right, remedy, recourse, or power at any
subsequent time in respect to the same or any other of the Events of Default.
The acceptance by the Lender of any payment hereunder which is less than payment
in full of all amounts due and payable at the time of such payment shall not
constitute a waiver of the right to exercise any of the Lender’s rights,
remedies, recourses, or powers at that time, or any subsequent time, or nullify
any prior exercise of any such right, remedy, recourse or power without the
written consent of the Lender, except as and to the extent otherwise required by
applicable law.
11. Reduction in Interest. It is the intention of the Borrower and the Lender to
conform strictly to the applicable laws of usury. All agreements and
transactions between the Borrower and the Lender, whether now existing or
hereafter arising, whether contained herein or in any other instrument, and
whether written or oral, are hereby expressly limited so that in no contingency
or event whatsoever, whether by reason of acceleration of the maturity hereof,
prepayment, demand for prepayment or otherwise, shall the amount contracted for,
charged or received by the Lender from the Borrower for the use, forbearance or
detention of the principal
EXHIBIT A
TO
LOAN AGREEMENT

 

 

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indebtedness or interest hereof, which remains unpaid from time to time, exceed
the Maximum Lawful Amount. Any interest payable hereunder or under any other
instrument relating to the Loan that is in excess of the Maximum Lawful Amount,
shall be applied, in the event of acceleration of maturity, prepayment, demand
for prepayment or otherwise, automatically, as of the date of such acceleration,
prepayment, demand or otherwise, to a reduction of the principal indebtedness
hereof and not to the payment of interest, or if such excessive interest exceeds
the unpaid balance of such principal, such excess shall be refunded to the
Borrower. To the extent not prohibited by law, determination of the legal
maximum rate of interest shall at all times be made by amortizing, prorating,
allocating and spreading all interest at any time contracted for, charged or
received from the Borrower in connection with the Loan in equal parts during the
period of the full term of the Loan until repayment in full of the principal
(including the period of renewal or extension hereof), so that the actual rate
of interest on account of such indebtedness does not exceed the Maximum Lawful
Rate.
12. Set Off. If the unpaid principal amount of this Note, interest accrued
hereon or any other amount owing by the Borrower hereunder or under any of the
other Loan Documents shall have become due and payable (by acceleration or
otherwise), the Lender shall have the right, in addition to all other rights and
remedies available to it, without notice to the Borrower, to set off against and
to appropriate and apply to such due and payable amounts any debt owing to the
Borrower, and any other funds held by the Lender in any manner for the account
of the Borrower. Such right shall exist whether or not the Lender shall have
given notice or made any demand hereunder, whether or not such debt owing to or
funds held for the account of the Borrower is or are matured or unmatured, and
regardless of the existence or adequacy of any collateral, guaranty or any other
security, right or remedy available to the Lender. The Borrower hereby consents
to and confirms the foregoing arrangements and confirms the Lender’s rights of
set off. Nothing in this Note or in any of the other Loan Documents shall be
deemed a waiver or prohibition of or restriction on the Lender’s rights of set
off.
13. Successors; Successor Interest Rate. As used herein, the term “Lender” shall
include the successors and assigns of the Lender and any subsequent owner and
holder of this Note (each such successor, assign and subsequent owner and holder
being hereinafter referred to as a “Successor Lender” for purposes of this
paragraph). During such period as a Successor Lender is the owner and holder
hereof, the term “Base Rate” shall mean the rate established from time to time
by the Successor Lender as its base rate or other similarly designated rate for
the guidance of the Successor Lender’s loan officers, whether or not such rate
is publicly announced.
14. Governing Law. This Note shall be deemed to be a contract made under and
shall be construed in accordance with and governed by the laws of the State of
Texas, except as federal law may apply. The parties irrevocably agree that any
cause of action brought to enforce or interpret the provisions of this Note
shall be brought in the district courts of Travis County, Texas or in the United
States District Court for the Western District of Texas (Austin Division).
EXHIBIT A
TO
LOAN AGREEMENT

 

 

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15. WAIVER OF JURY TRIAL. THE BORROWER AND THE LENDER HEREBY KNOWINGLY,
VOLUNTARILY, IRREVOCABLY AND INTENTIONALLY WAIVE, TO THE MAXIMUM EXTENT
PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM
ARISING OUT OF OR RELATED TO THIS NOTE OR THE ACTIONS OF THE LENDER IN THE
ENFORCEMENT HEREOF.
THIS NOTE, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[Signature page follows]

            Astrotech Space Operations, Inc.,
a Delaware corporation
      By:           John M. Porter,        Senior Vice President     

EXHIBIT A
TO
LOAN AGREEMENT

 

 

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FORM OF
TERM PROMISSORY NOTE
(Floating Rate)

          $7,000,000.00   Austin, Texas   October 21, 2010

This Term Promissory Note (the “Note”) is executed pursuant to the terms of that
certain Loan Agreement (as the same may be amended, modified restated or
replaced, the “Loan Agreement”) dated of even date herewith by and among
Astrotech Space Operations, Inc., a Delaware corporation (the “Borrower”),
Astrotech Corporation, a Washington corporation (the “Parent”), Astrotech
Florida Holdings, Inc., a Florida corporation (“Holdings” and, collectively,
with the Borrower and the Parent, the “Loan Parties”), and American Bank, N.A.
(the “Lender”). The loan to be made hereunder by the Lender shall be made in
reliance upon each and all of the terms, conditions, representations,
warranties, covenants and agreements of the Loan Agreement. In no event will the
Lender have any obligation to advance any proceeds of this Note unless the Loan
Parties fully satisfy all conditions thereto set forth in the Loan Agreement.
For value received, the Borrower promises to pay to the order of the Lender at
the location provided for payments in the Loan Agreement (or at such other place
as the Lender may hereafter direct the Borrower), the principal sum of SEVEN
MILLION AND 00/100 DOLLARS ($7,000,000.00), or the aggregate amount of all
unpaid advances made hereunder, whichever is the lesser, together with interest
on the outstanding portion thereof for the period such sums are unpaid, as
hereinafter provided.
16. Defined Terms. Capitalized terms which are used in this Note and are not
otherwise defined are used with the meanings provided for them in the Loan
Agreement, unless the context clearly requires otherwise. In addition, the
following terms shall have the following meanings:
(a) “Base Rate” means, for any day, a fluctuating interest rate per annum as
shall be in effect from time to time which rate per annum shall at all times be
equal to the rate established from time to time by the Lender as its base rate
for the guidance of its loan officers, whether or not publicly announced. The
Base Rate is set by the Lender as a general reference rate of interest, taking
into account such factors as the Lender may deem appropriate, it being
understood that many of the Lender’s commercial or other loans are not priced in
relation to such rate, that it is not necessarily the lowest or best rate
actually charged to any customer, that the Lender may make various commercial or
other loans at rates of interest having no relationship to such rate, and that
rates on other loans or credit facilities may be based on indicates other than
the Base Rate.
(b) “Loan” means the loan evidenced by the terms hereof.
EXHIBIT B
TO
LOAN AGREEMENT

 

 

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(c) “Loan Parties” means, collectively, the Borrower, the Parent and Holdings.
(d) “Loan Rate” means a varying rate per annum equal to the lower of (a)
one-quarter of one percent (0.25%) per annum in excess of the Base Rate, but in
no event less than four percent (4.00%) per annum, and (b) the Maximum Lawful
Rate. The rate per annum at which interest accrues hereunder may be adjusted by
the Lender without notice to the Borrower on the effective date of any change in
the Base Rate or the Maximum Lawful Rate, as the case may be. The Lender’s
determinations shall be deemed conclusive, absent manifest error.
(e) “Monthly Payment Amount” means an amount calculated by the Lender from time
to time which shall be the amount necessary to repay the principal sum of
$7,000,000.00 in one hundred eighty (180) consecutive equal monthly installments
of principal and interest at the Loan Rate in effect from time to time.
Initially, until adjusted as provided herein, the Monthly Payment Amount will be
the amount of Fifty-One Thousand Seven Hundred Seventy-Eight and 15/100 Dollars
($51,778.15). The Monthly Payment Amount may be adjusted by the Lender as
changes in the Loan Rate occur. Lender shall provide Borrower with prompt
written notice of any such change, which notice shall include the adjusted
Monthly Payment Amount. The Lender’s calculations shall be deemed conclusive
absent manifest error.
(f) “Payment Date” means the 21st day of each month (or the last day of any
month which does not include a numerically corresponding day), beginning
November 21, 2010.
(g) “Term Loan Maturity Date” means October 21, 2015.
17. Repayment of Principal and Interest. This Note is due and payable as
follows:
(a) Principal and interest shall be due and payable in monthly installments
equal to the Monthly Payment Amount on each Payment Date.
(b) Interest shall be calculated on the unpaid principal to the date of each
installment paid and the payment made credited first to the discharge of the
interest accrued and the balance to the reduction of the principal.
(c) The entire amount hereof, principal and interest remaining unpaid, shall be
due and payable in full on the Term Loan Maturity Date.
18. Interest Rate. Interest on the outstanding balance hereof shall accrue prior
to maturity at a varying rate per annum equal to the Loan Rate, subject to the
provisions of Section 19 below.
EXHIBIT B
TO
LOAN AGREEMENT

 

 

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19. Default Interest and Late Charges. The Borrower shall pay Default Interest
and Late Charges as provided in the Loan Agreement.
20. Interest Recoupment. To the fullest extent permitted by applicable law, if
at any time and from time to time the Lender is prevented from collecting the
rate of interest and the fees specified in this Note by applicable law or
governmental regulation, the Lender shall be entitled to recoup the amount it
would have otherwise been able to collect (the “Recoupment Amount”) during such
period when the recoupment will not violate such applicable law or regulation
(the “Recoupment Period”). During each Recoupment Period, the Borrower shall
continue to pay the Maximum Lawful Rate until there has been paid hereon, in
addition to the interest at the applicable rate specified herein during such
Recoupment Period, an amount equal to the Recoupment Amount. Interest collected
by the Lender during each Recoupment Period shall first be applied to payment of
current interest due at the applicable rate specified in this Note and any
remaining interest collected shall be applied to the Recoupment Amount. When the
Lender shall have recouped all of the Recoupment Amount, the interest rate
payable by the Borrower shall revert to the applicable rate specified in this
Note. In no event, however, shall the interest rate charged hereunder ever
exceed the Maximum Lawful Rate and in the event of any prepayment hereof, only
that portion of the Recoupment Amount which has been earned through the date of
prepayment shall be payable.
21. Events of Default. If any one or more of the Events of Default shall occur
for any reason whatsoever (and whether such occurrence shall be voluntary or
involuntary or come about or be effected by operation of law pursuant to or in
compliance with any judgment, decree or order of any court, or any order, rule
or regulation of any administrative or governmental body, or otherwise), then,
and in such event, and at any time thereafter, the holder of this Note may, at
its option without demand or notice to the Borrower which the Borrower expressly
waives, declare the outstanding principal and accrued interest owing under this
Note to be immediately due and payable, whereupon the entire unpaid principal
and accrued interest of this Note shall forthwith become and be due and payable.
22. Extension of Due Date. If the payment of principal or interest to be made on
this Note shall become due on a day other than a Business Day, such payment may
be made on the next succeeding Business Day (unless the result of such extension
of time would be to extend the date for such payment beyond the maturity date
hereof, in which event the payment shall be made on the Business Day immediately
preceding the day on which such payment would otherwise have been due).
23. Collateral Documents. Payment of this Note is secured by, and this Note is
entitled to the benefits of, each of the Collateral Documents.
EXHIBIT B
TO
LOAN AGREEMENT

 

 

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24. General Waivers. The Borrower waives presentment for payment, demand, notice
of intent to accelerate, notice of acceleration, protest and notice of protest,
and of dishonor, diligence in collecting and the bringing of suit against any
other party, and agrees to all renewals, extensions, partial payments, releases,
subordinations and substitutions of security, in whole or in part, with or
without notice, before or after maturity. The failure by the Lender to exercise
any of its rights, remedies, recourses, or powers upon the occurrence of one or
more of the Events of Default shall not constitute a waiver of the right to
exercise the same or any other right, remedy, recourse, or power at any
subsequent time in respect to the same or any other of the Events of Default.
The acceptance by the Lender of any payment hereunder which is less than payment
in full of all amounts due and payable at the time of such payment shall not
constitute a waiver of the right to exercise any of the Lender’s rights,
remedies, recourses, or powers at that time, or any subsequent time, or nullify
any prior exercise of any such right, remedy, recourse or power without the
written consent of the Lender, except as and to the extent otherwise required by
applicable law.
25. Reduction in Interest. It is the intention of the Borrower and the Lender to
conform strictly to the applicable laws of usury. All agreements and
transactions between the Borrower and the Lender, whether now existing or
hereafter arising, whether contained herein or in any other instrument, and
whether written or oral, are hereby expressly limited so that in no contingency
or event whatsoever, whether by reason of acceleration of the maturity hereof,
prepayment, demand for prepayment or otherwise, shall the amount contracted for,
charged or received by the Lender from the Borrower for the use, forbearance or
detention of the principal indebtedness or interest hereof, which remains unpaid
from time to time, exceed the Maximum Lawful Amount. Any interest payable
hereunder or under any other instrument relating to the Loan that is in excess
of the Maximum Lawful Amount, shall be applied, in the event of acceleration of
maturity, prepayment, demand for prepayment or otherwise, automatically, as of
the date of such acceleration, prepayment, demand or otherwise, to a reduction
of the principal indebtedness hereof and not to the payment of interest, or if
such excessive interest exceeds the unpaid balance of such principal, such
excess shall be refunded to the Borrower. To the extent not prohibited by law,
determination of the legal maximum rate of interest shall at all times be made
by amortizing, prorating, allocating and spreading all interest at any time
contracted for, charged or received from the Borrower in connection with the
Loan in equal parts during the period of the full term of the Loan until
repayment in full of the principal (including the period of renewal or extension
hereof), so that the actual rate of interest on account of such indebtedness
does not exceed the Maximum Lawful Rate.
26. Set Off. If the unpaid principal amount of this Note, interest accrued
hereon or any other amount owing by the Borrower hereunder or under any of the
other Loan Documents shall have become due and payable (by acceleration or
otherwise), the Lender shall have the right, in addition to all other rights and
remedies available to it, without notice to the Borrower, to set off against and
to appropriate and apply to such due and payable amounts any debt owing to the
Borrower, and any other funds held by the Lender in any manner for the account
of the Borrower. Such right shall exist whether or not the Lender shall have
given notice or made any demand hereunder, whether or not such debt owing to or
funds held for the account of the Borrower is or are matured or unmatured, and
regardless of the existence or adequacy of any collateral, guaranty or any other
security, right or remedy available to the Lender. The Borrower hereby consents
to and confirms the foregoing arrangements and confirms the Lender’s rights of
set off. Nothing in this Note or in any of the other Loan Documents shall be
deemed a waiver or prohibition of or restriction on the Lender’s rights of set
off.
EXHIBIT B
TO
LOAN AGREEMENT

 

 

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27. Successors; Successor Interest Rate. As used herein, the term “Lender” shall
include the successors and assigns of the Lender and any subsequent owner and
holder of this Note (each such successor, assign and subsequent owner and holder
being hereinafter referred to as a “Successor Lender” for purposes of this
paragraph). During such period as a Successor Lender is the owner and holder
hereof, the term “Base Rate” shall mean the rate established from time to time
by the Successor Lender as its base rate or other similarly designated rate for
the guidance of the Successor Lender’s loan officers, whether or not such rate
is publicly announced.
28. Governing Law. This Note shall be deemed to be a contract made under and
shall be construed in accordance with and governed by the laws of the State of
Texas, except as federal law may apply. The parties irrevocably agree that any
cause of action brought to enforce or interpret the provisions of this Note
shall be brought in the district courts of Travis County, Texas or in the United
States District Court for the Western District of Texas (Austin Division).
29. WAIVER OF JURY TRIAL. THE BORROWER AND THE LENDER HEREBY KNOWINGLY,
VOLUNTARILY, IRREVOCABLY AND INTENTIONALLY WAIVE, TO THE MAXIMUM EXTENT
PERMITTED BY LAW, ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR CLAIM
ARISING OUT OF OR RELATED TO THIS NOTE OR THE ACTIONS OF THE LENDER IN THE
ENFORCEMENT HEREOF.
THIS NOTE, THE LOAN AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

          [Signature page follows]
      Astrotech Space Operations, Inc.,
a Delaware corporation
      By:           John M. Porter,        Senior Vice President     

EXHIBIT B
TO
LOAN AGREEMENT

 

 

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

 

Borrowing Base Certificate
Month Ended _______, 200_

TO:    
American Bank, N.A.
3267 Bee Cave Road, Suite 103
Austin, Texas 78746
Attention: Loan Operations

In accordance with the provisions of Section 4.1 of that certain Loan Agreement
(the “Loan Agreement”) dated as of October 21, 2010 by and among Astrotech Space
Operations, Inc., a Delaware corporation (the “Borrower”), Astrotech
Corporation, a Washington corporation (the “Parent”), Astrotech Florida
Holdings, Inc., a Florida corporation (“Holdings”), and American Bank, N.A. (the
“Lender”), the undersigned, as principal officer of the Borrower, hereby
certifies as of _______, 201_______(the “Certification Date”) to the best of
his/her Knowledge to the following:

I.  
As of the Certification Date, the Borrowing Base is as follows:

RECEIVABLES

         
1. Total Accounts
  $    
 
     
2. Less: Ineligible Accounts
       
a. Accounts with terms in excess of 30 days
  $    
 
     
b. Accounts as to which a warranty or representation has been breached
  $    
 
     
c. Accounts more than 90 days past invoice date
  $    
 
     
d. Accounts as to which 25% or more of the outstanding Accounts from the Account
debtor have remained unpaid for more than ninety (90) days after the original
invoice date
  $    
 
     
e. Accounts owed by an Account debtor who owes 50% or more of all Accounts in
the aggregate (in which case, the amount exceeding 50% shall be treated as
ineligible);
  $    
 
     
f. Accounts including an amount billed for or representing retainage (in which
case, the amount of retainage shall be ineligible until all prerequisites to its
immediate payment have been satisfied);
  $    
 
     
g. Account as to which the Account debtor has filed a petition for relief under
the Bankruptcy Code (or similar action under any successor law, etc.
  $    
 
     
h. Accounts denominated in other than United States Dollars or payable outside
the United States or payable by an Account debtor whose principal place of
business is located outside the United States, except to the extent (1) covered
by Foreign Receivable Insurance acceptable to the Lender and which has been
assigned to the Lender by an assignment in Proper Form, or (2) approved by the
Lender
  $    
 
     
i. Accounts subject to offset, claim or dispute by the Account debtor (in which
case, the amount of the Account equal to the amount of such offset, claim or
dispute shall be ineligible)
  $    
 
     
j. Accounts subject to consignment, sale or return, guaranteed sale or bill and
hold;
  $    
 
     
k. Accounts subject to any Liens, other than Liens in favor of the Lender
  $    
 
     
l. Accounts of the United States government, the government of any state of the
United States or any political subdivision thereof, or any department, agency or
instrumentality of any of the foregoing and the Lender has not perfected a first
priority security interest in such Account (including, by way of illustration,
but not in limitation, perfection under the Federal Assignment of Claims Act)
  $    
 
     
m. Accounts owing by an Affiliate or employee
  $    
 
     
n. Accounts not evidenced by an invoice or other writing in Proper Form;
  $    
 
     
o. Account requiring additional service or performance
  $    
 
     
p. Accounts subject to any provision prohibiting assignment or requiring notice
of or consent to such assignment and (1) such prohibition has not been waived in
writing or such notice, (2) or consent has not been given or obtained, or
(3) such provision is unenforceable as to the right to grant a security interest
to the Lender under provisions of the Uniform Commercial Code applicable to such
Account.
  $    
 
     
TOTAL
  $    
 
     
 
       
3. Eligible Accounts [line (1) minus line (2)]
  $    
 
     
4. Borrowing Base [80% of line (3)]
  $    
 
     
5. Revolving Credit Limit
  $ 3,000,000.00  
6. Lesser of line (4) or line (5)
  $    
 
     
7. Amount of outstanding Advances
  $    
 
     
8. Available Amount [line (6) minus line (7)]
  $    
 
     
II. Attached hereto as Schedule 1 is a list of Borrower’s Accounts designating
Eligible Accounts, aged in thirty day intervals.
       
III. Terms used herein and not otherwise defined are used with the same meanings
given such terms in the Loan Agreement.
       

            Astrotech Space Operations, Inc.,
a Delaware corporation
      By:           Name:           Title:      

 

EXHIBIT C
TO
LOAN AGREEMENT

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COMPLIANCE CERTIFICATE
Date: _________________

TO:    
American Bank, N.A.
3267 Bee Cave Road, Suite 103
Austin, Texas 78746
Attention: Loan Operations

In accordance with the provisions of Section 4.1(f) of that certain Loan
Agreement (the “Loan Agreement”) dated as of October 21, 2010, by and among
Astrotech Space Operations, Inc., a Delaware corporation (the “Borrower”),
Astrotech Corporation, a Washington corporation (the “Parent”), Astrotech
Florida Holdings, Inc., a Florida corporation (“Holdings”), and American Bank,
N.A. (the “Lender”), the undersigned, as a principal officer of the Borrower,
hereby certifies as of _____, 201_____(the “Certification Date”) to his/her
Knowledge to the following:
1. As of the Certification Date, the Borrower’s compliance with the following
provisions of the Loan Agreement was as shown below:

                                          Section   Covenant                    
Compliance   Reference   Description     Required     Actual     Yes     No  
 
                                       
5.1(a)
  Leverage Ratio   Not greater than                        
 
          0.50 to 1.00                      
 
                                 
 
                                       
5.1(b)
  Debt Service Coverage   Not less than                        
 
  Ratio (After Distributions/   1.00 to 1.00                          
 
  Advances)                            
 
                                 
 
                                       
5.8
  Tangible Net Worth   Not less than                        
 
          $32,500,000                    
 
                                 

2. As of the Certification Date, no Default or Event of Default had occurred
[other
than ___________________________________________________________________________________________________
___________________________________________________________. Such Default or
Event of Default is not continuing or, if continuing, the Borrower is taking the
following steps to cure the same: __________________.]
3. Terms used herein and not otherwise defined are used with the same meanings
given such terms in the Loan Agreement.

           

Astrotech Space Operations, Inc.,
a Delaware corporation
      By:           Name:           Title:      

 

EXHIBIT D
TO
LOAN AGREEMENT

 

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COLLATERAL

1.  
The Titusville Facility
  3.  
All of the following now or hereafter owned by the Borrower or Holdings:

 
(a) Accounts, Chattel Paper, Commercial Tort Claims, Deposit Accounts,
Documents, Equipment, Financial Assets, General Intangibles, Goods, Instruments,
Inventory, Intellectual Property, Intangible Personal Property, Investment
Property, Letter of Credit Rights and Supporting Obligations; and
   
(b) All other personal (tangible and intangible) property of every character and
wherever situated.

 

Schedule 4.8