as Borrower
as Agent, Swingline Lender, Issuing Bank and Arranger
ARTICLE I. DEFINITIONS | 1 | |||
1.1 Definitions | 1 | |||
1.2 Accounting Terms | 19 | |||
1.3 Times of Day | 20 | |||
1.4 Letters of Credit Amounts | 20 | |||
ARTICLE II. THE CREDIT | 20 | |||
2.1 The Revolving Credit | 20 | |||
2.2 The Notes | 21 | |||
2.3 Swingline Loans | 21 | |||
2.4 Letters of Credit | 23 | |||
2.5 Funding of Borrowings | 30 | |||
2.6 Interest | 31 | |||
2.7 Prepayments and Payments | 32 | |||
2.8 Use of Proceeds | 34 | |||
2.9 Special Provisions Governing Libor Loans — Increased Costs | 34 | |||
2.10 Required Termination and Repayment of Libor Loans | 35 | |||
2.11 Taxes | 35 | |||
2.12 Commitment Fee | 36 | |||
2.13 Revolving Loan Commitment Termination and Reduction | 36 | |||
2.14 Payments | 36 | |||
2.15 Payments with Respect to Defaulting Lenders | 37 | |||
2.16 Upfront Fees | 37 | |||
2.17 Agent Fees | 37 | |||
2.18 Charge to Account | 37 | |||
2.19 Substitution of Lender | 37 | |||
2.20 Yield Protection | 38 | |||
2.21 Changes in Capital Adequacy Regulations | 39 | |||
2.22 Lender Statements; Survival of Indemnity | 39 | |||
2.23 Expansion Option | 40 | |||
ARTICLE III. CONDITIONS TO THE CREDIT | 41 | |||
3.1 No Default | 41 | |||
3.2 Representations and Warranties | 41 | |||
3.3 Proceedings | 42 | |||
3.4 Closing Conditions | 42 | |||
3.5 Conditions to Subsequent Borrowing and Issuance | 44 | |||
3.6 Subsequent Extensions of Credit | 45 | |||
ARTICLE IV. REPRESENTATIONS AND WARRANTIES | 45 | |||
4.1 Good Standing and Authority | 45 | |||
4.2 Valid and Binding Obligation | 45 | |||
4.3 Good Title | 45 | |||
4.4 No Pending Litigation | 45 | |||
4.5 No Consent or Filing | 45 |
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4.6 No Violations | 46 | |||
4.7 Financial Statements | 46 | |||
4.8 Tax Returns | 46 | |||
4.9 Federal Regulations | 47 | |||
4.10 Compliance with ERISA | 47 | |||
4.11 Subsidiaries; Affiliates | 47 | |||
4.12 Compliance | 47 | |||
4.13 Fiscal Year | 48 | |||
4.14 Default | 48 | |||
4.15 Indebtedness for Borrowed Money | 48 | |||
4.16 Securities | 48 | |||
4.17 Environmental Matters | 48 | |||
4.18 Burdensome Contracts; Labor Relations | 49 | |||
4.19 Liens | 49 | |||
4.20 Intellectual Property | 50 | |||
4.21 Anti-Terrorism Laws. | 50 | |||
4.22 Accuracy of Information, etc. | 51 | |||
4.23 Solvency | 51 | |||
ARTICLE V. AFFIRMATIVE COVENANTS | 52 | |||
5.1 Payments | 52 | |||
5.2 Financial Reporting Requirements | 52 | |||
5.3 Notices | 52 | |||
5.4 Taxes | 53 | |||
5.5 Insurance | 53 | |||
5.6 Litigation | 53 | |||
5.7 Judgments | 53 | |||
5.8 Corporate Standing | 54 | |||
5.9 Books and Records | 54 | |||
5.10 Compliance with Law | 54 | |||
5.11 Pension Reports | 54 | |||
5.12 Inspections | 54 | |||
5.13 Environmental Compliance | 54 | |||
5.14 Certain Subsidiaries to Become Guarantors | 55 | |||
5.15 Additional Security; Further Assurances. | 55 | |||
5.16 Accounting; Reserves; Tax Returns | 56 | |||
5.17 Liens and Encumbrances | 56 | |||
5.18 Defaults and Material Adverse Effects | 56 | |||
5.19 Good Repair | 57 | |||
5.20 Further Actions | 57 | |||
ARTICLE VI. NEGATIVE COVENANTS | 57 | |||
6.1 Indebtedness | 57 | |||
6.2 Encumbrances | 57 | |||
6.3 Investments and Guaranty Obligations | 58 | |||
6.4 Equity Interest Repurchases | 59 | |||
6.5 Limitation on Certain Restrictive Agreements | 59 | |||
6.6 Material Indebtedness Agreements | 60 |
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6.7 Consolidation, Merger, Acquisitions, Asset Sales, etc. | 60 | |||
6.8 Transactions with Affiliates | 61 | |||
6.9 Disposal of Hazardous Substances | 62 | |||
6.10 Fiscal Year, Fiscal Quarters | 62 | |||
6.11 Anti-Terrorism Laws | 62 | |||
6.12 Changes in Business | 62 | |||
6.13 Minimum Debt Service Coverage Ratio | 62 | |||
6.14 Maximum Fiscal Capital Expenditures | 62 | |||
6.15 Maximum Leverage Ratio | 62 | |||
6.16 Minimum Net Worth | 62 | |||
ARTICLE VII. DEFAULT | 63 | |||
7.1 Events of Default | 63 | |||
7.2 Effects of an Event of Default | 66 | |||
7.3 Remedies | 66 | |||
7.4 Application of Certain Payments and Proceeds | 66 | |||
ARTICLE VIII. INDEMNIFICATION — COSTS AND EXPENSES | 67 | |||
8.1 Indemnification | 67 | |||
8.2 Expenses | 68 | |||
ARTICLE IX. THE AGENT AND ISSUING BANK | 69 | |||
9.1 Appointment and Authorization | 69 | |||
9.2 Waiver of Liability of Agent | 69 | |||
9.3 Note Holders | 70 | |||
9.4 Consultation with Counsel | 70 | |||
9.5 Documents | 70 | |||
9.6 Agent and Affiliates | 70 | |||
9.7 Knowledge of Default | 71 | |||
9.8 Enforcement | 71 | |||
9.9 Action by Agent | 71 | |||
9.10 Notices, Defaults, etc. | 71 | |||
9.11 Indemnification of Agent | 71 | |||
9.12 Successor Agent | 72 | |||
9.13 Lenders’ Independent Investigation | 72 | |||
9.14 Amendments, Consents | 72 | |||
9.15 Funding by Agent | 73 | |||
9.16 Sharing of Payments | 73 | |||
9.17 Payment to Lenders | 73 | |||
9.18 Tax Withholding Clause | 74 | |||
9.19 USA Patriot Act | 74 | |||
9.20 Issuing Bank | 75 | |||
9.21 Benefit of Article IX | 75 | |||
ARTICLE X. MISCELLANEOUS | 75 | |||
10.1 Amendments and Waivers | 75 | |||
10.2 Delays and Omissions | 75 | |||
10.3 Assignments/Participation | 75 |
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10.4 Successors and Assigns | 77 | |||
10.5 Notices | 77 | |||
10.6 Governing Law | 78 | |||
10.7 Counterparts | 78 | |||
10.8 Titles | 78 | |||
10.9 Inconsistent Provisions | 78 | |||
10.10 Course of Dealing | 79 | |||
10.11 USA Patriot Act Notification | 79 | |||
10.12 JURY TRIAL WAIVER | 79 | |||
10.13 CONSENT TO JURISDICTION | 79 |
Exhibit A | - | Revolving Note | ||
Exhibit B | - | Swingline Note | ||
Exhibit C | - | Compliance Certificate | ||
Exhibit D | - | Request Certificate | ||
Exhibit E | - | 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 | < 1.00 to 1.0 | 0.125 | % | |||||
2 | > 1.00 to 1.0 but < 1.50 to 1.0 | 0.150 | % | |||||
3 | > 1.50 to 1.0 but < 2.00 to 1.0 | 0.200 | % | |||||
4 | > 2.00 to 1.0 | 0.250 | % |
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Leverage | ||||||||||||
Level | Ratio | Libor Rate Option | ABR Option | |||||||||
1 | < 1.00 to 1.0 | 0.750 | % | Minus 0.250% | ||||||||
2 | > 1.00 to 1.0 but < 1.50 | 1.000 | % | 0.000 | % | |||||||
3 | > 1.50 to 1.0 but < 2.00 to 1.0 | 1.250 | % | 0.000 | % | |||||||
4 | > 2.0 to 1.0 | 1.500 | % | 0.000 | % |
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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 | ||
(With a copy | Hodgson Russ LLP | |
which shall not | The Guaranty Building | |
itself constitute | 140 Pearl Street, Suite 100 | |
notice to): | 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: Mark F. Zeis, Senior Vice President | ||
Facsimile No. 716-841-6782 | ||
Telephone No. 716-841-2132 | ||
(With a copy | Phillips Lytle LLP | |
which shall not | 3400 HSBC Center | |
itself constitute | Buffalo, New York 14203 | |
notice to): | Attention: Raymond H. Seitz, Esq. | |
Facsimile No. 716-852-6100 | ||
Telephone No. 716-847-7065 |
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ASTRONICS CORPORATION | ||||
By: | ||||
David C. Burney | ||||
Vice President-Finance and Treasurer | ||||
HSBC BANK USA, NATIONAL ASSOCIATION, as Agent, Swingline Lender, Lender, Issuing Bank and Arranger | ||||
By: | ||||
Mark F. Zeis | ||||
Senior Vice President | ||||
BANK OF AMERICA, N.A., as a Lender | ||||
By: | ||||
Thomas C. Lillis | ||||
Senior Vice President | ||||
KEYBANK NATIONAL ASSOCIATION, as a Lender | ||||
By: | ||||
Mark F. Wachowiak | ||||
Vice President | ||||
Buffalo, New York | ||
$ | May 13, 2008 |
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ASTRONICS CORPORATION | ||||
By: | ||||
David C. Burney | ||||
Vice President-Finance and Treasurer |
AMOUNT | ||||||||||||||
DATE LOAN | AMOUNT OF | OF | AGGREGATE | |||||||||||
TYPE | MADE, CON- | LOAN MADE, | INTEREST | PRINCIPAL | UNPAID | NOTATION | ||||||||
OF | TINED OR | CONTINUED OR | PERIOD | DUE | PAID OR | PRINCIPAL | MADE BY | |||||||
LOAN | CONVERTED | CONVERTED | DATES | DATE | PREPAID | BALANCE | AND DATE | |||||||
Buffalo, New York | ||
$10,000,000.00 | May 13, 2008 |
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ASTRONICS CORPORATION | ||||
By: | ||||
David C. Burney | ||||
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 | ||||
§6.13 | Minimum Debt Service Coverage Ratio | |||||||
Consolidated Debt Service Coverage Ratio | = _____:1.0 | |||||||
Required: ³ 2.50 to 1.0 | ||||||||
§6.14 | Maximum Capital Expenditures | |||||||
Consolidated Capital Expenditures | $ | |||||||
Required: £ 10,000,000 |
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§6.15 | Maximum Leverage Ratio | |||||||
Consolidated Leverage Ratio | = | _____:1.0 | ||||||
Required: £ 3.00 to 1.0 | ||||||||
§6.16 | Minimum Net Worth | |||||||
Consolidated Net Worth | = | $ | ||||||
Required: ³ 40,000,000 increased by 25% of Consolidated Net Income after 12/31/07 |
ASTRONICS CORPORATION | ||||||
By | ||||||
Name: | ||||||
Title: | ||||||
o conversion
o continuation
o ABR Loan
o ABR Loan
o two months.
o three months.
o six months.
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ASTRONICS CORPORATION | ||||||
By | ||||||
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ASSIGNOR: | ||||
By: | ||||
Name: | ||||
Title: | ||||
ASSIGNEE: | ||||
By: | ||||
Name: | ||||
Title: | ||||
to
Assignment and Assumption
Percentage interest assigned: | % | |||
Assignee’s Revolving Credit Commitment: | $ | |||
Aggregate outstanding principal amount of Revolving Loans assigned: | $ | |||
Principal amount of Revolving Note payable to Assignee: | $ | |||
Principal amount of Revolving Note payable to Assignor: | $ | |||
Effective Date of Assignment | , 200 | |||||||||||||
[NAME OF ASSIGNOR], as Assignor | [NAME OF ASSIGNEE], as Assignee | |||||||||||||
By: | By: | |||||||||||||
Title: | Name: | |||||||||||||
Dated: | , 200___ | Dated: | , 200___ | |||||||||||
Domestic Lending Office: | ||||||||||||||
Libor Lending Office: | ||||||||||||||
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, 200
By: | ||||
Name: | ||||
Title: | ||||
HSBC BANK USA, NATIONAL ASSOCIATION, as Agent | ||||
By: | ||||
Name: | ||||
Title: | ||||
Commitment | Applicable | |||||||
Lender | (In Millions) | Percentage | ||||||
HSBC Bank USA, National Association | $ | 30.0 | 50.0 | % | ||||
Bank of America, N.A. | $ | 15.0 | 25.0 | % | ||||
KeyBank National Association | $ | 15.0 | 25.0 | % | ||||
TOTAL | $ | 60.0 | 100 | % |
1.Lender | 2.Domestic Lending Office | 3.Libor Lending Office | ||
4. | ||||
5. HSBC Bank USA, National | 7. One HSBC Center | 9. One HSBC Center | ||
6. Association | 8. Buffalo, NY 14203 | 10. Buffalo, NY 14203 | ||
11. | ||||
12. Bank of America, N.A. | 13. 2001 Clayton Road | 18. 2001 Clayton Road | ||
14. Concord, CA 94520 | 19. Concord, CA 94520 | |||
15. Attn: Anna Maria Finn | 20. Attn: Anna Maria Finn |
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16. Credit Service Rep. | 21. Credit Service Rep. | |||
17. | 22. | |||
23. KeyBank National | 24. 50 Fountain Plaza, 17th Floor | 26. 50 Fountain Plaza, 17th Floor | ||
Association | ||||
25. Buffalo, NY 14202 | 27. Buffalo, NY 14202 | |||
28. | 29. | 30. | ||
31. | 32. | 33. | ||
34. | 35. | 36. |
Letter of Credit | ||
Issuing Bank | Commitment | |
HSBC Bank USA, National Association | $5,000,000 |
Company | Incorporated | |
Luminescent Systems, Inc. | New York | |
Luminescent Systems Europe B.V.B.A. | Belgium | |
Luminescent Systems of Canada Inc. | Quebec, Canada | |
Astronics Advanced Electronic Systems Corp. | Washington | |
Astronics Air LLC * | New York |
* | 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 * | $ | 4,516,000 | 06/18 | ||||||
130 Commerce Way East Aurora, New York | Luminescent Systems, Inc. Luminescent Systems, Inc. | HSBC Bank HSBC Bank | IRB * IRB * | $ $ | 3,340,000 6,084,000 | 12/19 4/27 | ||||||
Unsecured Loan | Astronics Corporation | Empire State Development Corporation | Loan | $ | 50,091 | 3/1/11 | ||||||
Unsecured Loan Backed by Existing Letter of Credit | Luminescent Systems Canada Inc. | HSBC Bank Canada | Loan | $ | 1,357,539.91 | Demand, no later 8/31/15 |
* | Each of the IRB transactions are variable rate bond transactions backed by one of the IRB Letters of Credit. |
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