AMENDED AND RESTATED
CREDIT AGREEMENT
as Borrower
as Agent, Swingline Lender, and Issuing Bank
BANK OF AMERICA MERRILL LYNCH
as Lead Arrangers
as Documentation Agent
Page | ||||
ARTICLE I. DEFINITIONS | 1 | |||
1.1 Definitions | 1 | |||
1.2 Accounting Terms | 24 | |||
1.3 Times of Day | 25 | |||
1.4 Letters of Credit Amounts | 25 | |||
ARTICLE II. THE CREDITS | 25 | |||
2.1 The Revolving Credit and Term Loans | 25 | |||
2.2 The Notes | 26 | |||
2.3 Swingline Loans | 27 | |||
2.4 Letters of Credit | 28 | |||
2.5 Funding of Borrowings | 36 | |||
2.6 Interest | 37 | |||
2.7 Prepayments and Payments | 39 | |||
2.8 Use of Proceeds | 40 | |||
2.9 Alternate Rate of Interest | 40 | |||
2.10 Increased Costs | 41 | |||
2.11 Taxes | 42 | |||
2.12 Commitment Fee | 42 | |||
2.13 Revolving Credit Commitment Termination and Reduction | 42 | |||
2.14 Payments | 43 | |||
2.15 Defaulting Lenders | 44 | |||
2.16 Upfront Fee | 45 | |||
2.17 Agent Fees | 45 | |||
2.18 Charge to Account | 45 | |||
2.19 Substitution of Lender | 46 | |||
2.20 Lender Statements; Survival of Indemnity | 46 | |||
2.21 Expansion Option | 47 | |||
ARTICLE III. CONDITIONS TO THE CREDIT | 48 | |||
3.1 No Default | 48 | |||
3.2 Representations and Warranties | 49 | |||
3.3 Proceedings | 49 | |||
3.4 Closing Conditions | 49 | |||
3.5 Conditions to Subsequent Borrowing and Issuance | 51 | |||
3.6 Subsequent Extensions of Credit | 52 | |||
ARTICLE IV. REPRESENTATIONS AND WARRANTIES | 52 | |||
4.1 Good Standing and Authority | 52 | |||
4.2 Valid and Binding Obligation | 52 | |||
4.3 Good Title | 52 | |||
4.4 No Pending Litigation | 53 | |||
4.5 No Consent or Filing | 53 | |||
4.6 No Violations | 53 | |||
4.7 Financial Statements | 53 |
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4.8 Tax Returns | 54 | |||
4.9 Federal Regulations | 54 | |||
4.10 Compliance with ERISA | 54 | |||
4.11 Subsidiaries; Affiliates | 55 | |||
4.12 Compliance | 55 | |||
4.13 Fiscal Year | 55 | |||
4.14 Default | 55 | |||
4.15 Indebtedness for Borrowed Money | 55 | |||
4.16 Securities | 55 | |||
4.17 Environmental Matters | 56 | |||
4.18 Burdensome Contracts; Labor Relations | 56 | |||
4.19 Liens | 57 | |||
4.20 Intellectual Property | 57 | |||
4.21 Anti-Terrorism Laws/ Foreign Assets Control Regulations | 57 | |||
4.22 Accuracy of Information, etc | 58 | |||
4.23 Solvency | 59 | |||
ARTICLE V. AFFIRMATIVE COVENANTS | 59 | |||
5.1 Payments | 59 | |||
5.2 Financial Reporting Requirements | 59 | |||
5.3 Notices | 60 | |||
5.4 Taxes | 60 | |||
5.5 Insurance | 60 | |||
5.6 Litigation | 61 | |||
5.7 Judgments | 61 | |||
5.8 Corporate Standing | 61 | |||
5.9 Books and Records | 61 | |||
5.10 Compliance with Law | 61 | |||
5.11 Pension Reports | 61 | |||
5.12 Inspections | 62 | |||
5.13 Environmental Compliance | 62 | |||
5.14 Certain Subsidiaries to Become Guarantors | 62 | |||
5.15 Additional Security; Further Assurances | 63 | |||
5.16 Accounting; Reserves; Tax Returns | 63 | |||
5.17 Liens and Encumbrances | 63 | |||
5.18 Defaults and Material Adverse Effects | 64 | |||
5.19 Good Repair | 64 | |||
5.20 Further Actions | 64 | |||
ARTICLE VI. NEGATIVE COVENANTS | 64 | |||
6.1 Indebtedness | 64 | |||
6.2 Encumbrances | 65 | |||
6.3 Investments and Guaranty Obligation | 66 | |||
6.4 Equity Interest Repurchases | 66 | |||
6.5 Limitation on Certain Restrictive Agreements | 67 | |||
6.6 Material Indebtedness Agreements | 67 | |||
6.7 Consolidation, Merger, Acquisitions, Asset Sales, etc | 68 | |||
6.8 Transactions with Affiliates | 69 |
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6.9 Disposal of Hazardous Substances | 70 | |||
6.10 Fiscal Year, Fiscal Quarters | 70 | |||
6.11 Anti-Terrorism Laws | 70 | |||
6.12 Changes in Business | 70 | |||
6.13 Minimum Fixed Charge Coverage Ratio | 70 | |||
6.14 Maximum Capital Expenditures | 70 | |||
6.15 Maximum Leverage Ratio | 70 | |||
ARTICLE VII. DEFAULT | 71 | |||
7.1 Events of Default | 71 | |||
7.2 Effects of an Event of Default | 74 | |||
7.3 Remedies | 74 | |||
7.4 Application of Certain Payments and Proceeds | 74 | |||
ARTICLE VIII. INDEMNIFICATION — COSTS AND EXPENSES | 75 | |||
8.1 Indemnification | 75 | |||
8.2 Expenses | 76 | |||
ARTICLE IX. THE AGENT AND ISSUING BANK | 76 | |||
9.1 Appointment and Authorization | 76 | |||
9.2 Waiver of Liability of Agent | 77 | |||
9.3 Note Holders | 78 | |||
9.4 Consultation with Counsel | 78 | |||
9.5 Documents | 78 | |||
9.6 Agent and Affiliates | 79 | |||
9.7 Knowledge of Default | 79 | |||
9.8 Enforcement | 79 | |||
9.9 Action by Agent | 79 | |||
9.10 Notices, Defaults, etc | 80 | |||
9.11 Indemnification of Agent | 80 | |||
9.12 Successor Agent | 80 | |||
9.13 Lenders’ Independent Investigation | 81 | |||
9.14 Amendments, Consents | 81 | |||
9.15 Funding by Agent | 83 | |||
9.16 Sharing of Payments | 83 | |||
9.17 Payment to Lenders | 83 | |||
9.18 Tax Withholding Clause | 84 | |||
9.19 USA Patriot Act | 86 | |||
9.20 Issuing Bank | 86 | |||
9.21 Benefit of Article IX | 86 |
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ARTICLE X. MISCELLANEOUS | 87 | |||
10.1 Amendment and Restatement; Future Amendments | 87 | |||
10.2 Delays and Omissions | 87 | |||
10.3 Assignments/Participation | 87 | |||
10.4 Successors and Assigns | 89 | |||
10.5 Notices | 89 | |||
10.6 Governing Law | 90 | |||
10.7 Counterparts | 90 | |||
10.8 Titles | 90 | |||
10.9 Inconsistent Provisions | 91 | |||
10.10 Course of Dealing | 91 | |||
10.11 USA Patriot Act Notification | 91 | |||
10.12 Right of Set-Off | 91 | |||
10.13 No Advisory Or Fiduciary Responsibility | 92 | |||
10.14 JURY TRIAL WAIVER | 92 | |||
10.15 CONSENT TO JURISDICTION | 93 | |||
10.16 AMENDMENT AND RESTATEMENT | 93 |
Exhibit A | — | Replacement Revolving Note | ||
Exhibit B | — | Replacement Swingline Note | ||
Exhibit C | — | Replacement Term Note | ||
Exhibit D | — | Compliance Certificate | ||
Exhibit E | — | Request Certificate | ||
Exhibit F | — | Assignment and Assumption | ||
Schedule 1 | — | Employee Benefits Plan | ||
Schedule 2.1 | — | Lenders’ Commitments | ||
Schedule 4.11 | — | Subsidiaries; Affiliates | ||
Schedule 6.2 | — | Liens and Indebtedness | ||
Schedule 6.3 | — | Investments and Guaranty Obligations |
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Leverage | ||||||
Level | Ratio | Commitment Fee | ||||
1 | < 1.0 to 1.0 | 0.25 | % | |||
2 | > 1.00 to 1.0 but < 1.75 to 1.0 | 0.30 | % | |||
3 | > 1.75 to 1.0 but < 2.50 to 1.0 | 0.30 | % | |||
4 | > 2.50 to 1.0 | 0.35 | % |
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Leverage | ||||||||||
Level | Ratio | Libor Rate Option | ABR Option | |||||||
1 | < 1.0 to 1.0 | 1.50 | % | 0.50 | % | |||||
2 | > 1.00 to 1.0 but < 1.75 to 1.0 | 1.75 | % | 0.75 | % | |||||
3 | > 1.75 to 1.0 but < 2.50 to 1.0 | 2.00 | % | 1.00 | % | |||||
4 | > 2.5 to 1.0 | 2.50 | % | 1.50 | % |
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To the Borrower: | Astronics Corporation | |
130 Commerce Way | ||
East Aurora, New York 14052 | ||
Attn: David C. Burney, Vice President-Finance and Treasurer | ||
Facsimile No. 716-805-1286 | ||
Telephone No. 716-805-1599 ext. 159 |
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(With a copy which shall not itself constitute notice to): | Hodgson Russ LLP The Guaranty Building 140 Pearl Street, Suite 100 Buffalo, New York 14202-4040 Attention: Victoria J. Saxon, Esq. Facsimile No. 716-849-0349 Telephone No. 716-848-1755 | |
To HSBC Bank: | HSBC Bank USA, National Association Commercial Banking Department One HSBC Center Buffalo, New York 14203 Attn: Joseph W. Burden, Vice President Facsimile No. 716-841-0750 Telephone No. 716-841-6763 | |
(With a copy which shall not itself constitute notice to): | Phillips Lytle LLP 3400 HSBC Center Buffalo, New York 14203 Attention: Raymond H. Seitz, Esq. Facsimile No. 716-852-6100 Telephone No. 716-847-7065 |
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ASTRONICS CORPORATION | ||||||
By: | ||||||
Vice President-Finance and Treasurer | ||||||
HSBC BANK USA, NATIONAL ASSOCIATION, as Agent, Swingline Lender, a Lender and Issuing Bank | ||||||
By: | ||||||
Vice President | ||||||
BANK OF AMERICA, N.A., as a Lender | ||||||
By: | ||||||
Senior Vice President | ||||||
MANUFACTURERS AND TRADERS TRUST COMPANY, as a Lender | ||||||
By: | ||||||
Vice President |
Buffalo, New York | ||
$ | August 31, 2011 |
ASTRONICS CORPORATION | ||||||
By: | ||||||
Vice President-Finance and Treasurer |
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AMOUNT | ||||||||||||||
DATE LOAN | AMOUNT OF | OF | AGGREGATE | |||||||||||
TYPE | MADE, | LOAN MADE, | INTEREST | PRINCIPAL | UNPAID | NOTATION | ||||||||
OF | CONTINED OR | CONTINUED OR | PERIOD | DUE | PAID OR | PRINCIPAL | MADE BY | |||||||
LOAN | CONVERTED | CONVERTED | DATES | DATE | PREPAID | BALANCE | AND DATE | |||||||
Buffalo, New York | ||
$5,000,000.00 | August 31, 2011 |
ASTRONICS CORPORATION | ||||||
By: | ||||||
Vice President-Finance and Treasurer |
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AMOUNT OF | AGGREGATE | |||||||
PRINCIPAL | PRINCIPAL PAID OR | UNPAID PRINCIPAL | INSCRIPTION MADE | |||||
DATE | AMOUNT | REPAID | BALANCE | BY | ||||
$ | Buffalo, New York | |
August 31, 2011 |
ASTRONICS CORPORATION | ||||||
By: | ||||||
Vice President — Finance and Treasurer |
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AMOUNT | ||||||||||||||
DATE LOAN | AMOUNT OF | OF | AGGREGATE | |||||||||||
TYPE | MADE, | LOAN MADE, | INTEREST | PRINCIPAL | UNPAID | NOTATION | ||||||||
OF | CONTINED OR | CONTINUED OR | PERIOD | DUE | PAID OR | PRINCIPAL | MADE BY | |||||||
LOAN | CONVERTED | CONVERTED | DATES | DATE | PREPAID | BALANCE | AND DATE | |||||||
Period Ending Date: | ||||||
§6.13 | Minimum Fixed Charge Coverage Ratio | |||||
Consolidated Fixed Charge Coverage Ratio | = _____:1.0 | |||||
Required:![]() | ||||||
§6.14 | Maximum Capital Expenditures | |||||
Consolidated Capital Expenditures | $ | |||||
Required:![]() |
§6.15 | Maximum Leverage Ratio | |||||
Consolidated Leverage Ratio = | _____:1.0 | |||||
Required:![]() |
ASTRONICS CORPORATION | ||||||||
By: | ||||||||
Name: | ||||||||
Title: | ||||||||
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oRevolving Loan | oTerm Loan | |
(Check One) | (Check One) | |
o new loan | o new loan | |
o conversion | o conversion | |
o continuation | o continuation | |
of a | of a | |
(Check One) | (Check One) | |
o Libor Loan | o Libor Loan | |
o ABR Loan | o ABR Loan | |
to a or as a | to a or as a | |
(Check One) | (Check One) | |
o Libor Loan | o Libor Loan | |
o ABR Loan | o ABR Loan |
o two months.
o three months.
o six months.
ASTRONICS CORPORATION | ||||||
By: | ||||||
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1. Assignor: | ||
2. Assignee: | [and is an Affiliate/Approved Fund of [identify Lender]1] | |
3. Borrower: | Astronics Corporation | |
4. Administrative Agent: | HSBC Bank USA, National Association, as the administrative agent under the Credit Agreement |
1 | Select as applicable. |
5. Credit Agreement: | Second Amended and Restated Credit Agreement dated as of August 31, 2011 among Astronics Corporation, HSBC Bank USA, National Association, as Administrative Agent, for itself, the Lenders and other lending institutions and issuing banks now or hereafter parties thereto | |
6. Assigned Interest: |
Aggregate Amount of | Amount of | Percentage Assigned | ||||||||||
Commitment/Loans | Commitment/Loans | of | ||||||||||
Facility Assigned2 | for all Lenders | Assigned | Commitment/Loans3 | |||||||||
$ | $ | % | ||||||||||
$ | $ | % | ||||||||||
$ | $ | % |
ASSIGNOR [NAME OF ASSIGNOR] | ||||||
By: | ||||||
ASSIGNEE [NAME OF ASSIGNEE] | ||||||
By: | ||||||
2 | Fill in the appropriate terminology for the types of facilities under the Credit Agreement that are being assigned under this Assignment (e.g. “Commitment,” “Revolving Credit,” etc.) | |
3 | Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder. |
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[Consented to and]4 Accepted: HSBC Bank USA, National Association, as Administrative Agent | ||||
By: | ||||
[Consented to:]5 [NAME OF RELEVANT PARTY] | ||||
By: | ||||
4 | To be added only if the consent of the Administrative Agent is required by the terms of the Credit Agreement. | |
5 | To be added only if the consent of the Borrower and/or other parties (e.g. Swingline Lender, Issuing Bank) is required by the terms of the Credit Agreement. |
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to
Assignment and Assumption
ASSIGNMENT AND ASSUMPTION
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Revolving Credit | Term Credit | Total | Applicable | |||||||||||||
Lender | Commitments | Commitments | Commitments | Percentage | ||||||||||||
HSBC Bank USA, N.A. | $ | 14,411,764.71 | $ | 7,411,764.71 | $ | 21,823,529.42 | 41.176470588 | % | ||||||||
Bank of America, N.A. | $ | 14,411,764.71 | $ | 7,411,764.71 | $ | 21,823,529.42 | 41.176470588 | % | ||||||||
Manufacturers and Traders Trust Company | $ | 6,176,470.58 | $ | 3,176,470.58 | $ | 9,352,941.16 | 17.647058823 | % | ||||||||
Total | $ | 35,000,000.00 | $ | 18,000,000.00 | $ | 53,000,000.00 | 1.00000 | % |
Lender | Domestic Lending Office | Libor Lending Office | ||
HSBC Bank USA, National Association | One HSBC Center Buffalo, NY 14203 | One HSBC Center Buffalo, NY 14203 | ||
Bank of America, N.A. | 2001 Clayton Road Concord, CA 94520 Attn: Anna Maria Finn Credit Service Rep. | 2001 Clayton Road Concord, CA 94520 Attn: Anna Maria Finn Credit Service Rep. | ||
Manufacturers and Traders Trust Company | One Fountain Plaza Buffalo, NY 14203 | One Fountain Plaza Buffalo, NY 14203 |
Letter of Credit | ||||
Issuing Bank | Commitment | |||
HSBC Bank USA, National Association | $ | 20,000,000 |
Company | Incorporated | % Owned | ||||
Luminescent Systems, Inc. | New York | 100 | % | |||
Luminescent Systems Europe B.V.B.A. | Belgium | 50 | % | |||
Astronics Advanced Electronic Systems Corp. | Washington | 100 | % | |||
Astronics Air LLC * | New York | 100 | % | |||
D M E Corporation | Florida | 100 | % |
Luminescent Systems Europe B.V.B.A. | Belgium | 50 | % | |||
Luminescent Systems of Canada Inc. | Canada | 100 | % |
* | Sole asset is a single-engine aircraft |
Due | ||||||||||||||
Property/Equipment | Owner | Lien Held By | Type | Balance | Date | |||||||||
Lot 27, Centerra Business Park 4 Lucent Drive Lebanon, New Hampshire | Luminescent Systems, Inc. | HSBC Bank | IRB * | $ | 2,850,000 | 06/18 | ||||||||
130 Commerce Way East Aurora, New York | Luminescent Systems, Inc. | HSBC Bank | IRB * | $ | 2,595,000 | 12/19 | ||||||||
Luminescent Systems, Inc. | HSBC Bank | IRB * | $ | 5,740,000 | 4/27 | |||||||||
Unsecured Loan Backed by Existing Letter of Credit | Luminescent Systems Canada Inc. | HSBC Bank Canada | Loan | $ | 869,040 (U.S.) | Demand, no later 8/31/15 | ||||||||
Capitalized Lease/Secured Equipment Loan Covering Telephone System | D M E Corporation | US Bancorp | Lease | $ | 56,358 | 2012 | ||||||||
D M E Dell Equipment | D M E Corporation | Dell Financial Service L.P. | Secured Revolver | $ | 100,000 Maximum |
* | Each of the IRB transactions are variable rate bond transactions backed by one of the IRB Letters of Credit. |