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Exhibit 4.4
CREDIT AGREEMENT
dated February 23, 1993
relating to
DM 4,200,000 Term Loan
DM 5,500,000 Working Capital Line
between
WESPA Metallsagenfabrik Simonds Industries GmbH
as Borrower
and
The First National Bank of Boston
Zweigniederlassung Frankfurt
as Lender
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HENGELER MUELLER WEITZEL WIRTZ
Frankfurt am Main
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THIS AGREEMENT is made on February 23, 1993 between
(1) WESPA Metallsagenfabrik Simonds Industries GmbH, Lochmuhle 3, 3509
Spangenberg, registered in the Commercial Register of the Lower
District Court (Amtsgericht) Melsungen under No. HRB 1321 (the
"Borrower"); and
(2) The First National Bank of Boston Zweignieder-lassung Frankfurt,
Friedrich-Ebert-Anlage 2-14 (City-Haus), 6000 Frankfurt am Main (the
"Bank").
THE PARTIES AGREE AS FOLLOWS:
1. DEFINITIONS
"AS-IF-OPENING-BALANCE-SHEET" means the As-If-Opening-Balance-Sheet
prepared in accordance with GAAP and correctly translated from the
"Als-Ob-Eroffnungsbilanz" as of the Balance Sheet Date prepared by Arthur
Andersen & Co. GmbH Wirtschafts-prufungsgesellschaft
Steuerberatungsgesellschaft, Frankfurt am Main.
"BALANCE SHEET DATE" means January 1, 1992 which is the date of the
As-If-Opening-Balance-Sheet of the Borrower.
"BANKING DAY" means any day on which banks are open for business in
Frankfurt am Main.
"BORROWING BASE REPORT" means a report with respect to a Borrowing Base
of the Borrower in the form of SCHEDULE 2.
"BORROWING BASE" means, at any time of determination, an amount equal
to the sum of the following: (a) eighty percent (80 %) of the Eligible
Receivables, plus (b) fifty percent (50 %) of the Eligible Inventory provided
that the maximum amount of 50 % of Eligible Inventory to be taken into account
for calculating the Borrowing Base shall be DM 2,250,000.
"CLOSING FEE" means the fee in the amount of U.S.$ 30,000 payable by
the Borrower to The First National Bank of Boston, Boston Office, Eastern
Commercial III, and to be deducted by the Bank from the disbursements to be made
on the Disbursement Date.
"CONSOLIDATED TANGIBLE NET WORTH" means, at any date as of which the
amount thereof shall be determined, the consolidated total assets of the
Borrower and its Subsidiaries (carried on the books and records of the Borrower
in accordance with GAAP) MINUS (i) the sum of any amounts attributable to (a)
goodwill, (b) intangible items such as unamortized debt discount and expense,
patents, trade and service marks and names, copyrights and research and
development expenses except prepaid expenses, (c) all reserves not already
deducted from assets, (d) any write-up in the book value of assets resulting
from any revaluation thereof subsequent to the Balance Sheet Date (other than
any write-up in the book value of inventory if and to the extent
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permitted in accordance with GAAP) and (e) the value of any minority interests
in Subsidiaries AND (ii) Consolidated Total Liabilities, PLUS any Subordinated
Intercompany Debt.
"CONSOLIDATED TOTAL LIABILITIES" means, at any date as of which the
amount thereof shall be determined, all obligations that should, in accordance
with GAAP, be classified as liabilities on the consolidated balance sheet of the
Borrower and its Subsidiaries, including in any event all Indebtedness.
"DISBURSEMENT DATE" means the date on which the Term Loan and certain
drawings under the Working Capital Line Facility are to be disbursed.
"DM" means Deutsche Mark.
"EBIT" means for any period an amount equal to Net Income for such
period, plus the following, to the extent deducted in computing such Net Income:
(i) interest on Indebtedness for borrowed money, (ii) taxes and (iii) all
extraordinary items.
"ELIGIBLE INVENTORY" means, at any given time, the lesser of (a) the
fair market value of, or (b) the amounts shown on the books and records of the
Borrower (valued on a first-in first-out basis, in accordance with GAAP) in
respect of, all inventory owned by the Borrower which is held for sale or which
consists of raw materials or work-in-progress, and which:
(i) is subject to a valid, first priority (except for Permitted
Liens) security transfer of title in favour of the Bank under
the Security Transfer Agreement;
(ii) is in good saleable condition, is not deteriorating in quality
and is not obsolete;
(iii) is owned by the Borrower free and clear of all liens, security
interests or encumbrances whatsoever other than those in
favour of the Bank and Permitted Liens, less the aggregate
amount of accounts payable relating to the Eligible Inventory
(whereby accounts payable to Simonds Industries, Inc. for the
delivery of goods which relate to Eligible Inventory shall not
be deducted).
"ELIGIBLE RECEIVABLES" means, at any given time, the aggregate amount
of all accounts receivable (including bills of exchange) carried on the books
and records of the Borrower in accordance with GAAP arising in the ordinary
course of business of the Borrower, less all reserves with respect to such
accounts receivable and less any and all offsets, right of retention,
counterclaims or other contras in respect thereof, and which accounts receivable
(i) are originally due in accordance with the standard terms
presently extended by the Borrower payable within no more than
one hundred and twenty (120) days of the date of invoice, and
are not past due by more than thirty (30) days;
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(ii) constitute the valid, binding and legally enforceable
obligation of the obligor thereon, and are not expressly
subordinated to any other claims against such obligor;
(iii) are not evidenced by any instrument, unless for the benefit of
the Bank or the Borrower;
(iv) are owned by the Borrower free and clear of all liens,
security interests or encumbrances whatsoever, other than
those in favour of the Bank and Permitted Liens;
(v) are not the subject of a return, rejection, loss of or damage
to the goods, the sale of which gave rise to the account
receivable, or any request for credit or adjustment, or any
other dispute with the obligor of the account receivable;
(vi) are from an obligor on the account receivable which is
creditworthy in the reasonable business judgment of the Bank;
(vii) are not accounts receivable from an obligor which is subject
to or for which a petition has been filed by itself or any
third party, for relief under any existing of future law
relating to bankruptcy, composition, insolvency,
reorganization or relief of debtors, made a general assignment
for the benefit of creditors, suspended business operations,
became 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;
(viii) are subject to a valid, first priority security interest
(except for Permitted Liens) in favour of the Bank pursuant to
the Global Assignment Agreement; and
(ix) are otherwise satisfactory to the Bank, in its sole
discretion, using reasonable business judgment.
plus bills of exchange which have been, and for as long as they remain
to be, accepted by the Bank under the discount credit according to
Clause 3.2.5 below.
For the purpose of this definition, to the extent that the Borrower is
at any time directly or contingently indebted for any reason to any
obligor, the accounts receivable owing to the Borrower by such obligor
shall be deemed to be subject to an offset, right of retention,
counterclaim or other contra in the amount of such indebtedness.
"EVENT OF DEFAULT" means any of the events specified in Clause 12.
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"FLEET AGREEMENT" means the Amended and Restated Credit Agreement dated
as of November 1, 1991 between Fleet Bank of Massachusetts, N.A and Simonds
Industries, Inc. as amended, supplemented, restated or novated from time to
time.
"GAAP" means generally accepted accounting principals as in effect from
time to time in the United States of America, which shall include the official
interpretations thereof by the Financial Accounting Standards Board,
consistently applied.
"GLOBAL ASSIGNMENT AGREEMENT" means the global assignment agreement
between the Borrower and the Bank.
"GUARANTEES" means the guarantees dated as of January 29, 1993 by
Simonds Holding Company Inc. and Simonds Industries Inc. in favour of the Bank.
"GUARANTORS" means Simonds Holding Company Inc. and Simonds Industries
Inc.
"INDEBTEDNESS" means, with respect to any person or entity, and
includes, without duplication, all obligations of such person or entity which in
accordance with GAAP shall be classified upon a balance sheet as liabilities of
such person or entity, and in any event includes all (i) obligations of such
person or entity for borrowed money or which has been incurred in connection
with the acquisition of property or assets, (ii) obligations secured by any lien
or other charge upon property or assets owned by such person or entity, even
though such person or entity has not assumed or become liable for the payment of
such obligations, (iii) obligations created or arising under any conditional
sale or other title retention agreement with respect to property acquired by
such person or entity, notwithstanding the fact that the rights and remedies of
the seller, lender or lessor under such agreement in the event of default are
limited to repossession or sale of property, (iv) guaranties of obligations of
others for borrowed money, and (v) rentals on any capitalized lease.
"INTEREST PERIOD" means any interest period relating to the Term Loan
as specified in Clause 7.1.1.
"LAND CHARGES VOLKSBANK HESSISCH-LICHTENAU" means the following land
charges (Grundschulden) granted in favour of Volksbank Hessisch-Lichtenau eG,
Hessisch-Lichtenau:
(i) registered in Division III of the Land Register of the Lower
District Court (Amtsgericht) Melsungen vol. 95, folio 3071
(before vol. 60, folio 2042), with respect to any or all of
the real properties
- con. no. 1: Jahnstra(beta)e, district of Spangenberg,
lot 5, parcel 91/1, 1.600 square Meters (before con.
no. 25 in vol. 60, folio 2042: Am Muhlgraben);
- con. no. 2: Heinrich-Bender-Stra(beta)e 7, district
of Spangenberg, lot 22, parcel 19/1, 1.561 square
Meters (before con. no. 17 in vol. 60, folio 2042);
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- con. no. 3: Heinrich-Bender-Stra(beta)e 7, district
of Spangenberg, lot 22, parcel 20, 396 square Meters
(before con. no. 20 of vol. 60, folio 2042: In der
Aue)
in the following amounts:
- con. no. 1 (before con. no. 5 of vol. 60, folio
2042): land charge in the amount of DM 150,000;
- con. no. 2 (before con. no. 6 of vol. 60, folio
2042): land charge in the amount of DM 50,000;
- con. no. 3 (before con. no. 16 of vol. 60, folio
2042): land charge in the amount of DM 200,000;
- con. no. 4 (before con. no. 18 of vol. 60, folio
2042): land charge in the amount of DM 200,000;
- con. no. 5 (before con. no. 19 of vol. 60, folio
2042): land charge in the amount of DM 400,000;
(ii) registered in Division III of the Land Register of the Lower
District Court (Amtsgericht) Melsungen vol. 59, folio 1978,
with respect to any or all of the real properties
- con. no. 4: Lochmuhle 3-7, district of Spangenberg,
lot 5, parcel 92/1, 2.445 square Meters;
- con. no. 5: Adam-Schenk-Stra(beta)e, district of
Spangenberg, lot 4, parcel 54/5, 16 square Meters;
and
Lochmuhle 3-7, district of Spangenberg, lot 5, parcel
92/8, 4.290 square Meters
in the following amounts:
- con. no. 1: land charge in the amount of DM 70,000;
- con. no. 2: land charge in the amount of DM 130,000;
- con. no. 3: land charge in the amount of DM 100,000;
- con. no. 4: land charge in the amount of DM 950,000;
- con. no. 5: land charge in the amount of DM 600,000;
- con. no. 6: land charge in the amount of DM 400,000;
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- con. no. 7: land charge in the amount of DM 200,000.
"LOAN DOCUMENT" or "LOAN DOCUMENTS" means, as the case may be, any or
all of the Security Transfer Agreement, Global Assignment Agreement, Trade Mark
Assignment Agreement, Guarantees, Share Pledge Agreement, Assignment of Land
Charges Hessisch-Lichtenau, Simonds Holding Statement of Subordination, Simonds
Industries Statement of Subordination, Term Loan Notice of Drawing, Repayment
Notice of Drawing, any other notice of drawing hereunder, Borrowing Base Report,
form for the opening of accounts with the Bank, or any other contract,
agreement, or instrument in relation to this Agreement to which the Borrower
and/or the Guarantors are or will become a party.
"NET INCOME" means the consolidated gross revenues of the Borrower and
its subsidiaries for the period in question, less all expenses and other proper
charges (including taxes on income), all determined in accordance with US-GAAP.
"PERMITTED LIENS" means
(i) any judicial liens in favour of third parties (e.g. taxes,
landlords, warehouses) arising by operation of law;
(ii) any liens on goods supplied to the Borrower arising from a
retention of title (Eigentumsvorbehalt) imposed by the
suppliers of the Borrower in connection with the supply of
goods in the ordinary course of business of the Borrower;
(iii) any security transfers, assignments for security purposes,
land charges, pledges, or other encumbrances created by the
Borrower in favour of third parties in connection with
indebtedness for borrowed money as permitted pursuant to
Clause 9.1 below or on any of the fixed assets or inventory or
accounts receivable of the Borrower released pursuant to the
respective provisions of the Security Transfer Agreement, the
Global Assignment Agreement and the Trade Mark Assignment
Agreement.
"REAL ESTATE" means the real estate owned by the Borrower and
registered in:
(i) the Land Register of the Lower District Court (Amtsgericht)
Melsungen vol. 95, folio 3071 (before vol. 60, folio 2042),
- con. no. 1: Jahnstra(beta)e, district of Spangenberg,
lot 5, parcel 91/1, 1.600 square Meters (before con.
no. 25 in vol. 60, folio 2042: Am Muhlgraben);
- con. no. 2: Heinrich-Bender-Stra(beta)e 7, district
of Spangenberg, lot 22, parcel 19/1, 1.561 square
Meters (before con. no. 17 in vol. 60, folio 2042);
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- con. no. 3: Heinrich-Bender-Stra(beta)e 7, district
of Spangenberg, lot 22, parcel 20, 396 square Meters
(before con. no. 20 of vol. 60, folio 2042: In der
Aue)
(ii) the Land Register of the Lower District Court (Amtsgericht)
Melsungen vol. 59, folio 1978,
- con. 4: Lochmuhle 3-7, district of Spangenberg, lot
5, parcel 92/1, 2.445 square Meters ;
- con. no. 5: Adam-Schenk-Stra(beta)e, district of
Spangenberg, lot 4, parcel 54/5, 16 square Meters;
- Lochmuhle 3-7, district of Spangenberg, lot 5, parcel
92/8, 4.290 square Meters; and
- con. no. 6: Lochmuhle 3-7, district of Spangenberg,
lot 5, parcel 92/10.
"SECURITY TRANSFER AGREEMENT" means the security transfer agreement
between the Borrower and the Bank.
"SHARE PLEDGE AGREEMENT" means the share pledge agreement between
Simonds Industries Inc. and Simonds Holding Company Inc. as pledgors and the
Bank as pledgee concerning a pledge over all shares in the Borrower.
"SIMONDS HOLDING STATEMENT OF SUBORDINATION" means the statement of
subordination by Simonds Holding Company Inc. in favor of the Bank.
"SIMONDS INDUSTRIES STATEMENT OF SUBORDINATION" means the statement of
subordination by Simonds Industries Inc. in favour of the Bank.
"SUBORDINATED INTERCOMPANY DEBT" means indebtedness owed to Simonds
Industries Inc. or directly or indirectly wholly owned subsidiaries of Simonds
Industries Inc. the payment of principal of and interest on which is expressly
subordinated in right of payment, in form and on terms approved by the Bank in
writing, to the prior payment in full of any outstandings owed by the Borrower
to the Bank, and includes in particular, but without limitation, the
Indebtedness subordinated by the Simonds Holding Statement of Subordination and
the Simonds Industries Statement of Subordination.
"SUBSIDIARY" means any corporation, association, joint stock company,
business trust or other similar organization of which 50% or more of the
ordinary voting power for the election of a majority of the members of the board
of directors or other governing body of such entity is held or controlled by the
Borrower or a Subsidiary of the Borrower; or any other such organization the
management of which is directly or indirectly controlled by the Borrower or a
Subsidiary of the Borrower through the exercise of voting power or otherwise; or
any joint venture, whether incorporated or not, in which the Borrower has a 50%
ownership interest.
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"TERM LOAN" means the term loan in the nominal amount of DM 4,200,000.
"TERM LOAN NOTICE OF DRAWING" means the notice of drawing of the
Borrower with respect to the Term Loan.
"TOTAL LIABILITIES" means all liabilities of the Borrower as determined
in accordance with GAAP.
"TRADE MARK ASSIGNMENT AGREEMENT" means the trade mark assignment
agreement between the Borrower and the Bank.
"WORKING CAPITAL LINE FACILITY" means the working capital line facility
granted by the Bank to the Borrower in the aggregate nominal amount of DM
5,500,000.
2. THE TERM LOAN
2.1 TERM LOAN: The Bank shall make the Term Loan available to the
Borrower in one amount.
2.2 PURPOSE: The Borrower shall apply the proceeds of the
disbursement of the Term Loan exclusively to
2.2.1 firstly, to the extent necessary after having made
full use of an amount of DM 3,380,000 which will be drawn by the
Borrower under the Working Capital Line Facility on the basis of the
Borrowing Base as of the Disbursement Date for the repayments
(including the guarantees required from the Bank for outstanding bills
of exchange) to Volksbank Spangenberg Zweigniederlassung der Volksbank
Hess.-Lichtenau eG and Kreissparkasse Kassel pursuant to Clause 3.2
below, to the repayment of any residual amounts still outstanding with
the same; and
2.2.2 secondly, to the extent of the unused portion of the
Term Loan after payments pursuant to Clause 2.2.1 above, to the payment
of all accrued interest and the partial repayment of principal of the
intercompany loan extended to the Borrower by Simonds Holding Company
Inc. pursuant to the Intercompany Loan Agreement dated January 21, 1992
in the principal amount of U.S. $2,533,376.00.
2.3 The Bank is hereby unconditionally and irrevocably
instructed by the Borrower to disburse the usable amount of the Term
Loan by purchasing, with the DM amount drawn, U.S. Dollars in Frankfurt
am Main at the spot rate prevailing at the time of drawing, and by
remitting the U.S. Dollar amount to Simonds Holding Company Inc. in
partial discharge of the claim of Simonds Holding Company Inc. against
the Borrower for payment of accrued interest and repayment of capital
on the intercompany loan specified in Clause 2.2.2 above, all in
accordance with the Term Loan Notice of Drawing.
3. THE WORKING CAPITAL LINE FACILITY
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3.1 FACILITY: The Bank shall grant the Borrower the Working
Capital Line Facility.
3.2 PURPOSE: The Borrower shall apply the proceeds of drawings
under the Working Capital Line Facility as follows:
3.2.1 The Borrower shall repay (or use) an amount equalling
the amount notified by Volksbank Spangenberg Zweigniederlassung der
Volksbank Hess.-Lichtenau eG, Spangenberg, to the Bank as of the
Disbursement Date (or any other date specified by the aforementioned
bank) to be the aggregate amount of repayable outstanding sums (or sums
required by such bank to be guaranteed by the Bank with respect to
outstanding bills of exchange) of principal, interest, fees and other
amounts under the credit agreement (Kreditvertrag) no. 20 0686 made
between Volksbank Spangenberg Zweigniederlassung der Volksbank
Hess.-Lichtenau eG as lender and the Borrower as borrower and dated
September 27, 1990.
3.2.2 The Borrower shall repay (or use) an amount equalling
the amount notified by Kreissparkasse Kassel, Kassel, to the Bank as of
the Disbursement Date (or any other date specified by the
aforementioned bank) to be the aggregate amount of repayable
outstanding sums (or sums required by such bank to be guaranteed by the
Bank with respect to outstanding bills of exchange) of principal,
interest, fees and other amounts under the credit agreement
(Universalvertrag fur Geschaftskredite) customer no. 86058 made between
Kreissparkasse Kassel as lender and the Borrower as borrower and dated
January 23, 1992.
3.2.3 With respect to the amounts specified pursuant to
Clauses 3.2.1 and 3.2.2 above, the Bank is hereby unconditionally and
irrevocably instructed by the Borrower to disburse the aforesaid
amounts under the Working Capital Line Facility (or any amounts drawn
with respect to the repayments specified pursuant to Clauses 3.2.1 and
3.2.2 above under the Term Loan pursuant to Clause 2.2.1 above)
directly to Volksbank Spangenberg Zweigniederlassung der Volksbank
Hess-Lichtenau and Kreissparkasse Kassel, respectively.
3.2.4 Except for the amounts specified in Clauses 3.2.1 and
3.2.2 above, the Borrower shall apply the proceeds of any drawings
under the Working Capital Line Facility exclusively to the financing of
its day to day business operations.
3.2.5 From the Working Capital Line Facility, an amount of
up to DM 1,000,000 may be drawn by the Borrower as discount credit
against presentation by the Borrower to the Bank of bills of exchange
(Wechsel) under the following terms and conditions:
3.2.5.1 The Bank may decide on the acceptance of
bills of exchange on a case by case basis. The Bank will in
any event only accept bills of exchange which have a maximum
maturity of no more than ninety (90) days and which are
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(except where otherwise agreed by the Bank on a case by case
basis) acceptable for rediscount by the Deutsche Bundesbank.
3.2.5.2 If no special agreement is made, bills of
exchange shall be deemed accepted by the Bank for collection
purposes only, but not for discounting by the Bank.
3.2.5.3 If no special agreement is made, the Bank
shall be authorized to present bills of exchange for payment
at maturity or to rediscount bills of exchange with the
Deutsche Bundesbank.
3.2.5.4 The Bank shall be authorized to return bills
of exchange to the Borrower and to debit the account of the
Borrower accordingly (including any loss of interest or other
damage suffered by the Bank) if:
(i) the Bank will become aware of any
circumstances which, in the reasonable discretion of
the Bank, give rise to believe that any of the
obligors under the bill of exchange is not or no
longer in a position to honour the bill of exchange
at maturity; or
(ii) the bill of exchange will be
protested by any of the obligors thereunder; or
(iii) any bill of exchange rediscounted
by the Bank with the Deutsche Bundesbank will be
returned by the Deutsche Bundesbank to the Bank
thereafter on the basis that the bill of exchange is
found by the Deutsche Bundesbank not to be suitable
for rediscount; or
(iv) the bill of exchange will not be
honoured in the full amount against presentation at
maturity; or
(v) the proceeds from presentation of
the bill of exchange cannot be collected at maturity
by the Bank in full due to any legislative or
governmental act; or
(vi) the Bank will not or not timely be
in a position, for reasons for which the Bank is not
responsible, to present the bill of exchange for
payment at maturity.
3.2.5.5 At the time of accepting delivery of a bill
of exchange for collection, the Bank shall acquire title to
the bill of exchange for security purposes. At the time of
accepting delivery of a bill of exchange for discount, the
Bank shall acquire unrestricted legal title to the bill of
exchange. If the Bank will be entitled to return any
discounted bill of exchange to the Borrower and to debit
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the account of the Borrower accordingly, the Bank shall retain
title to the bill of exchange for security purposes.
3.2.5.6 When acquiring title to a bill of exchange,
the Bank shall also acquire title to the claims underlying the
bill of exchange (assignment for security purposes).
3.2.5.7 The transfer of title to the bills of
exchange and the assignment of security purposes of the
underlying claims shall serve the purpose of securing all
claims the Bank may have against the Borrower as a result of
any event entitling the Bank to return the bill of exchange to
the Borrower.
4. DISBURSEMENTS
4.1 DISBURSEMENT OF TERM LOAN: Subject to the exception granted in
Clause 4.3 below with respect to the repayment to be made to Volksbank
Spangenberg Zweigniederlassung der Volksbank Hess.-Lichtenau eG, the Borrower
shall on the Disbursement Date draw the Term Loan in one amount. The Bank shall
only be obliged to disburse the Term Loan if all of the following conditions
have been met in full:
4.1.1 REPRESENTATION, WARRANTIES, AGREEMENTS: As of the
Disbursement Date, the representations, warranties and agreements of
the Borrower in this Agreement and in any of the other Loan Documents
to which the Borrower is or is to become a party, and of the Guarantors
in the Guarantees are true and accurate in all respects and have been
duly complied with.
4.1.2 TERM LOAN NOTICE OF DRAWING: The Bank shall have
received not later than 10 a.m. (Frankfurt time) on the second Banking
Day prior to the Disbursement Date the Term Loan Notice of Drawing
certifying that, as of the Disbursement Date, the representations,
warranties and agreements of the Borrower in this Agreement and in any
of the other Loan Documents to which the Borrower is or is to become a
party and of the Guarantors in the Guarantee are true and accurate in
all respects and have been duly complied with, and that no Event of
Default has occurred.
4.1.3 AGREEMENTS EXECUTED: On or prior to the Disbursement
Date, all agreements and documents listed in SCHEDULE 1 hereto have
been, in form and contents satisfactory to the Bank, duly executed,
delivered and exchanged by all parties thereto, and where indicated
delivered to the Bank in the original or where appropriate in copy.
4.1.4 CLOSING FEE: On or prior to the Disbursement Date,
the Bank shall have the right to withhold the Closing Fee free of any
counterclaim or right of set-off.
4.2 DRAWINGS UNDER THE WORKING CAPITAL LINE FACILITY: On the
Disbursement Date or any other date specified by Volksbank Spangenberg
Zweigniederlassung der Volksbank Hessisch-Lichtenau eG or Kreissparkasse Kassel
the Borrower shall draw the amounts specified
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pursuant to Clauses 3.2.1 and 3.2.2 above and shall be entitled on or after the
Disbursement Date to draw other amounts under the Working Capital Line Facility.
To the extent requested by the Borrower the Bank shall provide guarantees to
Volksbank Spangenberg Zweigniederlassung der Volksbank Hessisch-Lichtenau e.G.
and Kreissparkasse Kassel for liabilities of the Borrower to these credit
institutions resulting from bills of exchange up to a maximum amount of DM
180,000 in the case of Volksbank Spangenberg Zweigniederlassung der Volksbank
Hessisch-Lichtenau e.G. and DM 100,000 in the case of Kreissparkasse Kassel. For
the time and to the extent that liabilities of the Borrower to Volksbank
Spangenberg Zweigniederlassung der Volksbank Hessisch-Lichtenau e.G. and
Kreissparkasse Kassel resulting from bills of exchange are existing, the
granting of guarantees by the Bank concerning such liabilities is deemed to be a
drawing under the Working Capital Line Facility. The Bank shall only be obliged
to disburse any amounts and to make any guarantees under the Working Capital
Line Facility if:
4.2.1 CONDITIONS FOR TERM LOAN: all of the conditions
specified in Clause 4.1 above have been met in full; and
4.2.2 REPAYMENT NOTICE OF DRAWING: the Bank shall have
received not later than 10 a.m. (Frankfurt time) on the second Banking
Day prior to the Disbursement Date the Repayment Notice of Drawing; and
4.2.3 DISBURSEMENT OF TERM LOAN: the Term Loan has been
disbursed upon the fulfilment of all conditions precedent thereto.
4.3 WAIVER: The Bank may in its free discretion and upon terms as
it deems appropriate, waive the compliance with the whole or any of the
conditions precedent for disbursement set forth in Clauses 4.1 and 4.2 above.
Until the Bank will be in receipt of satisfactory evidence of the execution of
the Assignment of Land Charges Hessisch-Lichtenau and the statement of Volksbank
Spangenberg Zweigniederlassung der Volksbank Hess.-Lichtenau eG pursuant to
Clause 3.2.1 in form and contents satisfactory to the Bank, the Bank shall have
the right to withhold from the Term Loan and/or the Working Capital Line
Facility such amounts as will in the discretion of the Bank be necessary to make
the payments (or give the guarantees with respect to outstanding bills of
exchange) required to be made to induce Volksbank Spangenberg Zweigniederlassung
der Volksbank Hess.-Lichtenau eG to execute the Assignment of Land Charges
Hessisch-Lichtenau (albeit in escrow) and the statement pursuant to Clause 3.2.1
in form and substance satisfactory to the Bank.
5. REPAYMENT OF TERM LOAN
5.1 REPAYMENTS: Subject as otherwise provided in this Agreement,
the Term Loan shall be repaid in 28 equal quarterly installments in the amount
of DM 150,000 each, the first of which shall be payable on March 31, 1993 and
the last of which shall be payable on December 31, 1999.
5.2 PREPAYMENTS: The Borrower shall be entitled to prepay at the
end of an Interest Period principal amounts of the Term Loan in the minimum
amount of DM 100,000 or integral
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multiples thereof. Any notice of prepayment shall be irrevocable and shall be
given at least one month prior to the date of prepayment. Any prepayment will be
applied to any outstanding ordinary installments of repayment in inverse order
of maturity.
5.3 NO REBORROWINGS: Any amounts repaid pursuant to Clauses 5.1 or
5.2 above may not be reborrowed.
6. AVAILABILITY, REPAYMENT AND CANCELLATION OF WORKING CAPITAL LINE
FACILITY
6.1 CURRENT CHECKING ACCOUNT: The Borrower shall open a current
checking account (Kontokorrentkonto) at the office of the Bank in Frankfurt am
Main by completing standard documentation required in accordance with usual
practice of the Bank.
6.2 DRAWINGS: Subject always to Clause 6.4 below, the Borrower
shall be entitled to borrow, repay and reborrow any amounts made available under
the Working Capital Line Facility, provided, however, that the aggregate amounts
of outstandings (principal, interest and fees and charges) with respect to
discount credit pursuant to Clause 3.2.5 above may at no time exceed DM
1,000,000, and further provided that the aggregate amount of outstandings
(principal, interest and fees and charges) may in total at no time exceed DM
5,500,000.
6.3 CANCELLATION OF WORKING CAPITAL LINE FACILITY: The Working
Capital Line Facility is made available to the Borrower on an on demand basis
and may be cancelled by the Bank at any time in whole or in part. Upon receipt
of a written notice from the Bank to the effect that the Working Capital Line
Facility shall be cancelled in its entirety or reduced to a certain maximum
amount, the Borrower shall repay to the Bank within five (5) Banking Days from
receipt of such notice any amounts outstanding under the Working Capital Line
Facility, including accrued interest and fees and charges, which are in excess
of the newly determined maximum amount (which may be a nil amount) of the
Working Capital Line Facility. The Working Capital Line Facility will
automatically terminate on December 31, 1999 (or any other earlier date on which
the Term Loan will be repaid) on which date all outstanding amounts under the
Working Capital Line Facility including accrued interest and fees and charges
shall become due and payable to the Bank.
6.4 BORROWING BASE: The aggregate amount of outstandings
(principal, interest, fees and charges) under the Working Capital Line Facility
may at no time exceed the Borrowing Base. If at any time the aggregate
outstanding amount will exceed the Borrowing Base for any reason whatsoever, the
Borrower shall immediately notify the Bank thereof and shall within five (5)
days pay the amount of such excess to the Bank.
7. INTEREST
7.1 TERM LOAN: The Term Loan shall bear interest as follows:
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7.1.1 INTEREST PERIODS: Interest shall be calculated and
payable by reference to successive Interest Periods. Each Interest
Period shall be of 1, 2, 3 or 6 months' duration as selected by the
Borrower in the Term Loan Notice of Drawing or thereafter in a notice
received by the Bank not later than 10 a.m. (Frankfurt time) on the
second Banking Day prior to the first day of the Interest Period,
provided that
7.1.1.1 if the Borrower fails to select the duration
of the next applicable Interest Period in accordance with the
provisions of this Clause 7.1.1, such Interest Period shall be
for a period of three (3) months;
7.1.1.2 each subsequent Interest Period shall
commence on the day immediately following the expiry of the
preceding Interest Period;
7.1.1.3 if an Interest Period would otherwise end on
a day which is not a Banking Day, such Interest Period shall
end on the next Banking Day in the same calendar month or, if
none, on the immediately preceding Banking Day.
7.1.2 INTEREST RATE: The Interest rate shall be calculated
as follows:
7.1.2.1 Unless otherwise provided in this Agreement
the rate of interest for the Term Loan applicable to each
Interest Period shall be the rate of 1.5 % p.a. (one and one
half of one percent per annum) above the Frankfurt InterBank
Offered Rate ("FIBOR") relating to such Interest Period. FIBOR
shall mean the rate p.a. at which prime banks are being
offered deposits in Deutsche Mark for like periods in the
Frankfurt InterBank Market as quoted on Telerate Screen Page
No. 2200 at or about 11 a.m. Frankfurt time on the third
Banking Day prior to the first day of such Interest Period.
7.1.2.2 If, for any reason, the quotation pursuant
to Clause 7.1.2.1 shall not be available, then interest
relating to such Interest Period shall be determined by the
Bank which determination shall be conclusive and binding on
the Borrower as being the arithmetic mean rounded upwards to
the nearest 1/16 of one percent of the rates p.a. at which the
Bank is being offered similar amounts for similar periods in
Deutsche Mark by prime banks in the Frankfurt InterBank Market
at or about 11 a.m. Frankfurt time on the second Banking Day
prior to the first day of such Interest Period.
7.1.2.3 INTEREST PAYMENTS: Interest for each
Interest Period shall be payable in arrears on the last day of
the respective Interest Period.
7.2 WORKING CAPITAL LINE FACILITY: Any drawings under the Working
Capital Line Facility shall bear interest as follows:
7.2.1 DISCOUNT CREDIT: Any amounts drawn under the Working
Capital Line Facility with respect to discount credit pursuant to
Clause 3.2.5 shall bear interest at the
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rate per annum equal to the Discount Rate (Diskontsatz), as fixed by
the Deutsche Bundesbank from time to time, plus 1.25%.
7.2.2 OTHER DRAWINGS: Any other amounts drawn under the
Working Capital Line Facility pursuant to Clauses 3.2.1, 3.2.2 and
3.2.4 above shall bear interest
7.2.2.1 up to an amount of drawings of no more than
DM 4,000,000 at the rate per annum equal to the annual rate of
interest announced from time to time by the Bank as its "best
offered overdraft rate" for loans in Deutsche Mark plus 0.25%;
and
7.2.2.2 if and for so long as the aggregate amount
of drawings exceeds DM 4,000,000, with respect to the excess
amount at the rate per annum equal to the annual rate of
interest announced from time to time by the Bank as its "best
offered overdraft rate" for loans in Deutsche Mark plus 0.50%.
7.2.3 DRAWINGS FOR GUARANTEES: For any drawings under the
Working Capital Line Facility for amounts which shall be guaranteed by
the Bank to Volksbank Spangenberg Zweigniederlassung der Volksbank
Hessisch-Lichtenau eG or Kreissparkasse Kassel for outstanding bills of
exchange pursuant to Clauses 3.2.1 or 3.2.2 above, the Bank shall
receive, in lieu of interest thereon, a guarantee fee at the rate of
0.25% per annum. Any provisions of this Agreement applicable to
interest on drawings under the Working Capital Line Facility shall
apply mutatis mutandis to such fee.
7.2.4 INTEREST PAYMENTS: Interest shall be payable monthly
in arrears at the end of each calendar month.
7.3 INTEREST CALCULATION: All calculations of interest on the Term
Loan or drawings under the Working Capital Line Facility shall be based on a
360-day year and on the actual amount of days elapsed on which the respective
amounts of principal were outstanding.
8. CERTAIN COMMON PROVISIONS
8.1 MANDATORY PREPAYMENT FOLLOWING CHANGE OF OWNERSHIP: In the
event that the Borrower ceases to be a directly or indirectly wholly owned
subsidiary of Simonds Industries Inc. or any corporation, partnership or other
entity which is wholly owned by Simonds Industries Inc., the Borrower shall
repay, immediately upon the occurrence of such event, all principal and accrued
interest and any other sums outstanding under the Term Loan and pursuant to all
drawings made under the Working Capital Line Facility.
8.2 PAYMENTS DUE ON NON-BUSINESS DAY: Except as otherwise
specifically provided herein, whenever a payment to be made hereunder becomes
due on a day which is not a Banking Day, the due date for such payment shall be
extended to the next succeeding day which is a Banking Day, and interest shall
accrue during such extension.
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8.3 CHANGE IN MARKET CONDITIONS: In the event that the Bank shall
determine that adequate and reasonable methods do not exist for ascertaining the
FIBOR applicable to the Term Loan, the Bank shall forthwith give written notice
of such determination (which shall be conclusive and binding on the Borrower) at
least one (1) Banking Day prior to the first day of the Interest Period
concerned. In such event, the Bank shall negotiate with the Borrower with a view
to agreeing on an alternative basis for calculating the interest payable on
and/or for making, maintaining and/or funding of the Term Loan. Any alternative
basis agreed in writing by the Bank and the Borrower within two (2) weeks of the
Bank's notification shall take effect in accordance with its terms. If an
alternative basis is not so agreed, the Borrower shall immediately prepay the
Term Loan together with accrued interest at the rate per annum equal to the rate
specified by the Bank to be an interest rate equivalent to the cost to the Bank
of funding plus 1.5%.
8.4 ILLEGALITY: If any introduction of or change in any law,
regulation, treaty or directive or in the interpretation or application thereof
shall make it unlawful, or any central bank or other fiscal, monetary or other
governmental authority having jurisdiction over the Bank shall assert that it is
unlawful, for the Bank to make or maintain the Term Loan and/or the Working
Capital Line Facility, the Bank shall forthwith give written notice to the
Borrower. In such event, any amounts outstanding under the Term Loan or drawn
under the working Capital Line Facility shall be prepaid by the Borrower
together with accrued interest and any other amounts outstanding at the last day
of the current Interest Period applicable to the Term Loan or at such earlier
date as may be required by law.
8.5 INCREASED COSTS: If any introduction of or change in any law,
regulation, treaty or directive or in the interpretation or application thereof,
or any request, directive, instruction or notice hereafter made upon or
otherwise issued to the Bank by any central bank or other fiscal, monetary or
other governmental authority, shall:
8.5.1 hereafter subject the Bank to any tax, levy, impost,
duty, charge, fee, deduction or withholding of any nature with respect
to this Agreement (other than taxes on income or profit of the Bank);
or
8.5.2 materially change the basis of taxation (except for
changes in taxes on income or profit of the Bank) of payments to the
Bank of the principal of or interest on any amounts outstanding under
this Agreement; or
8.5.3 impose or increase or render applicable any deposit,
reserve, assessment, liquidity, or other similar requirements against
assets held by, or deposits in or for the account of, or loans by, or
commitments of, or bankers acceptances created by, the Bank; or
8.5.4 impose on the Bank any other conditions or
requirements with respect to this Agreement, and
8.5.5 the result of the foregoing is
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(i) to increase the cost to the Bank of making,
funding, issuing, renewing, extending or maintaining the Term
Loan or any drawings under the Working Capital Line Facility;
or
(ii) to reduce the amount of principal, interest
or other amounts payable to the Bank under this Agreement; or
(iii) to require the Bank to make any payment or
to forego any interest or other sum payable under this
Agreement, the amount of which payment or foregone interest or
other sum is calculated by reference to the gross amount of
any sum receivable or deemed received by the Bank from the
Borrower under this Agreement,
8.5.6 then, and in each such case, the Borrower shall, upon
demand by the Bank, at any time and from time to time and as often as
the occasion therefor may arise, pay to the Bank such additional
amounts as will be sufficient to compensate the Bank for such
additional cost, reduction, payment or foregone interest or other sum,
as determined by the Bank which determination by the Bank shall be
conclusive and binding on the Borrower, safe for manifest error.
8.6 CAPITAL ADEQUACY: If the Bank shall have determined that any
present or future applicable law, regulation, guideline, directive or request
(whether or not having force of law) regarding capital requirements for banks or
bank holding companies, or any change therein or in the interpretation or
administration thereof by any governmental authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by the Bank with any of the foregoing, imposes or increases a requirement by the
Bank to allocate capital resources to the Bank's commitment to make, or to the
Bank's maintenance of, loans hereunder, which has or would have the effect of
reducing the return on the Bank's capital to a level below that which the Bank
could have achieved (taking into consideration the Bank's then existing policies
with respect to capital adequacy and assuming full utilization of the Bank's
capital) but for such applicability, change, interpretation or compliance, by
any amount deemed by the Bank to be material, the Bank shall promptly after its
determination of such occurrence give written notice thereof to the Borrower.
The Borrower and the Bank shall thereafter attempt to negotiate in good faith an
adjustment to the compensation payable hereunder which will adequately
compensate the Bank for such reduction. If the Borrower and the Bank are unable
to agree to such adjustment within two (2) weeks of the day on which the
Borrower receives such notice, then commencing on the date of such notice (but
not earlier than the effective date of any such applicability, change,
interpretation or compliance), the amounts payable hereunder shall increase by
an amount which will, in the Bank's reasonable determination, compensate the
Bank for such reduction, the Bank's determination of such amount to be
conclusive and binding on the Borrower, absent manifest error. In determining
such amount, the Bank may use any reasonable methods of averaging, allocating or
attributing such reduction among its customers.
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8.7 INTEREST ON OVERDUE AMOUNTS: Interest on overdue amounts shall
be calculated as follows:
8.7.1 INTEREST ON OVERDUE PRINCIPAL: If the Borrower shall
fail to pay any amount of principal or any other sums (except for
interest) payable by it under this Agreement on the due date thereof,
the Borrower shall pay interest on the overdue amount, for the period
from the due date until the date of receipt of payment of the overdue
amount, at the rate per annum equalling the interest rate applicable to
the overdue amount under this Agreement plus 3%.
8.7.2 INTEREST ON OVERDUE INTEREST: If the Borrower shall
fail to pay any amount of interest on the due date thereof, the
Borrower shall pay contractual damages with respect to such overdue
amount to be calculated in accordance with Clause 8.7.1 above.
8.7.3 FURTHER DAMAGES: The right of the Bank to demand
compensation for further damages suffered by reason of the delay in
payment shall remain unprejudiced.
8.7.4 ASSIGNMENT OF SUBORDINATED LOANS: The Borrower
already here and now assigns for security purposes to the Bank and the
Bank accepts such assignment of, any and all claims the Borrower may
have
(i) against Simonds Holding Company Inc. or any
successor or assign with respect to the intercompany loan
governed by the Simonds Holding Statement of Subordination; or
(ii) against Simonds Industries Inc. or any
successor or assign with respect to the Simonds Industries
Statement of Subordination for repayment of any amounts paid
by the Borrower to Simonds Holding Company Inc. and/or Simonds
Industries Inc., as the case may be, in violation of the
subordination provided in the Simonds Holding Statement of
Subordination or the Simonds Industries Statement of
Subordination.
8.8 CERTIFICATES CONCLUSIVE: Any certificate, calculation,
determination, notification, opinion or selection of the Bank provided for or
referred to in this Agreement, shall be conclusive and binding on the Borrower,
save for manifest error.
8.9 INDEMNITY: The Borrower agrees to indemnify the Bank and to
hold the Bank harmless from any loss or expense that the Bank may sustain or
incur as a consequence of a delay in payment by the Borrower in payment of
principal or interest on the Term Loan or drawings under the Working Capital
Line Facility, including any such loss or expense arising from interest or fees
payable by the Bank to lenders of funds obtained by it in order to maintain its
refinancing.
8.10 GENERAL INDEMNIFICATION: Save for cases of willful misconduct
or gross negligence on the part of the Bank, the Borrower agrees to indemnify
and hold harmless the Bank from and against any and all claims, actions and
suits, whether groundless or otherwise,
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and from and against any and all liabilities, losses, damages and expenses of
every nature and character arising out of this Agreement or any of the other
Loan Documents to which the Borrower is or is to become a party or the
transactions evidenced thereby.
9. COVENANTS
The Borrower undertakes towards the Bank that, for so long as any sum
remains to be payable by the Borrower under or in connection with this
Agreement:
9.1 FINANCIAL COVENANTS: The Borrower will ensure that it meets
and will meet at all times the following financial covenants:
9.1.1 MINIMUM NET INCOME: The Net Income of the Borrower
during two consecutive calendar quarters shall not fall below zero. The
Borrower shall submit on an ongoing basis to the Bank within forty-five
(45) days after the end of the last preceding calendar quarter
(beginning with the calendar quarter ending on March 31, 1993), for the
last preceding two calendar quarters, such financial data and
information, prepared in accordance with GAAP consistently applied,
from which the Bank is able to verify whether the covenant pursuant to
sentence 1 above has been met.
9.1.2 INTEREST COVERAGE: The Borrower will not permit the
ratio of (a) EBIT to (b) the total expense of the Borrower for interest
on Indebtedness for borrowed money (whether or not, with respect to
subordinated debt, payment thereof is prohibited and not paid by reason
of any applicable subordination) to be less than 1.25:1. The Borrower
shall submit on an ongoing basis to the Bank, within forty-five (45)
days after the end of the last preceding calendar quarter, for the last
preceding four calendar quarters (beginning with the calendar quarter
ending on March 31, 1993 and cumulatively built-up until four calendar
quarters shall have been completed) such financial data and information
prepared in accordance with GAAP consistently applied, from which the
Bank is able to verify whether the covenant pursuant to sentence 1
above has been met.
9.1.3 TOTAL LIABILITIES TO NET WORTH: The Borrower will not
permit the ratio of (a) Total Consolidated Liabilities (excluding any
Subordinated Intercompany Debt) to (b) Consolidated Tangible Net Worth
(excluding any adjustments for exchange rate fluctuations and plus any
Subordinated Intercompany Debt) to be more than as set forth below
during the periods set forth below:
For The Periods: Maximum Ratio
---------------- -------------
1/1/93 - 12/31/93 5.5:1
1/1/94 - 12/31/94 5.5:1
1/1/95 - 12/31/95 5.0:1
1/1/96 - 12/31/96 4.0:1
1/1/97 - 12/31/97 and thereafter 3.0:1
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The Borrower shall submit on an ongoing basis to the Bank, within
forty-five (45) days after the end of the last preceding calendar
quarter, for such last preceding calendar quarter (beginning with the
calendar quarter ending on March 31, 1993) such financial data and
information, prepared in accordance with GAAP consistently applied,
from which the Bank is able to verify whether the covenant pursuant to
sentence 1 above has been met.
9.2 FINANCIAL STATEMENTS: The Borrower will deliver to the Bank
two (2) copies of the following:
9.2.1 as soon as available and in any event at least thirty
(30) days prior to the beginning of the next fiscal year its annual
budget including business projections for the next fiscal year;
9.2.2 as soon as available and in any event within ninety
(90) days after the end of each fiscal year its audited annual
financial statements prepared in accordance with German law and
generally accepted accounting principles consistently applied, as well
as a translation thereof into annual financial statements following
U.S. formate and in accordance with GAAP consistently applied;
9.2.3 as soon as available and in any event within
forty-five (45) days after the end of each calendar quarter (or quarter
of a fiscal year deviating from the calendar year) quarterly financial
statements prepared in accordance with GAAP consistently applied;
9.2.4 as soon as available and in any event within two (2)
weeks after the end of each calendar month, a Borrowing Base Report;
9.2.5 from time to time upon request by the Bank, such
other financial data and information (including, without limitation
accountants' management letters and such other information regarding
the business and affairs and conditions, financial or otherwise, of the
Borrower) as the Bank may reasonably request.
9.3 INSPECTION OF PROPERTIES AND BOOKS: The Borrower shall permit
the Bank to visit and inspect the properties of the Borrower, to examine the
books and ledgers of the Borrower (and make copies thereof and extracts
therefrom), and to discuss the affairs, finances and accounts of the Borrower
with, and to be advised as to the same by, its officers, employees and
independent public accountants (such accountants being hereby authorized by the
Borrower to so discuss and advise), all at such times and intervals as the Bank
may reasonably request, but at least twice in each calendar year. In connection
with any such inspections or discussions, the Bank, on behalf of itself or any
representative authorized by it, agrees to treat as confidential any non-public
information that the Borrower shall designate as confidential information,
provided, however, that this Clause 9.3 shall not affect the disclosure by the
Bank of information required to be disclosed to its auditors, regulatory
agencies or pursuant to any legal process or by virtue of any other law,
regulation, order or interpretation.
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9.4 INSURANCE: The Borrower shall take out and maintain with
financially sound and reputable insurers insurance with respect to its business
and in particular its assets (in particular the Real Estate) against such
casualties and contingencies as shall be in accordance with sound business
practices and in amounts, containing such terms, and for such periods as may be
reasonably satisfactory to the Bank. The Borrower hereby assigns for security
purposes to the Bank all present and future claims of the Borrower against
insurers. The Borrower shall inform the insurers of (i) the Bank's entitlement
to any and all rights under the insurance contracts, and (ii) the Bank's
exclusive assumption of the rights, and not of the obligations, under the
insurance contracts. The Borrower shall request the insurers to provide the Bank
with according security notes. In the event that the Borrower shall not insure,
or not sufficiently insure, the risks concerned, the Bank shall be entitled to
do so at the Borrower's risk and expense. If so requested by the Bank, the
Borrower shall take out the insurance in favour of the party concerned, or
naming the bank as insured party.
9.5 TAXES AND OTHER COSTS: The Borrower shall (i) duly file all
returns and other forms when the same are due for filing with respect to, and
will (ii) duly pay and discharge before the same shall become overdue, all
taxes, duties, assessments and other governmental charges imposed upon it and
its properties, in particular real properties, sales and activities, or any part
thereof, or upon the income or profits therefrom, as well as all claims for
labour, materials and supplies that, if unpaid might by law result in a lien or
other encumbrance upon any of its properties.
9.6 COMPLIANCE WITH LAWS AND CONTRACTS: The Borrower shall at all
times fully comply with (i) all applicable laws and regulations wherever its
business is conducted, including all environmental laws, (ii) all contracts, all
agreements and instruments by which it or any of its properties may be bound,
and (iii) all applicable decrees, orders or judgments, in each case where
non-compliance could reasonably be expected to have an adverse effect on the
Borrower or its business.
9.7 FURTHER ASSURANCES: The Borrower shall fully cooperate with
the Bank and execute such further instruments and documents as the Bank shall
reasonably request to carry out to its satisfaction and to implement, the
transactions contemplated in this Agreement any other Loan Documents.
9.8 NOTICE OF DEFAULT: The Borrower shall promptly notify the Bank
in writing of the occurrence of any Event of Default. If any person shall give
any notice or take any other action in respect of a claimed default under this
Agreement, or any other note, evidence of indebtedness, indenture or other
obligation to which the Borrower is a party or obligor, whether as principal or
surety, the Borrower shall forthwith give written notice of the action and the
nature of the claimed default in reasonable detail.
9.9 NOTICE OF LITIGATION AND CLAIMS: The Borrower shall,
immediately upon become aware thereof, notify the Bank in writing of any pending
or threatened litigation, judgment, administrative order, setoff, claims,
withholdings or other defenses with an individual value of
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DM 100,000 or more to which the Borrower or any of its properties are or may
become subject, describing the nature thereof in reasonable detail.
9.10 RESTRICTIONS ON SALE AND LEASE BACK: The Borrower shall not
enter into any arrangement, directly or indirectly, whereby the Borrower shall
sell or transfer any property, in particular real property, owned by it in order
then or thereafter to lease such property or other property that the Borrower
intends to use for substantially the same purpose as the property being sold or
transferred, except for any such sale and lease back transactions entered into
with Simonds Industries Inc. or directly or indirectly wholly owned subsidiaries
of Simonds Industries Inc., which shall provide for a subordination of the
claims of the other party, and which shall require the express prior and written
consent of the Bank which consent shall not be unreasonably withheld.
9.11 CONSOLIDATION, MERGER AND SALE OF ASSETS: The Borrower shall
not merge or consolidate into or with any other person or convey, sell, lease or
otherwise dispose of all or substantially all of its assets.
9.12 LIQUIDATION: The Borrower shall not liquidate, dissolve or
wind up its affairs nor institute, consent to or fail promptly to contest
proceedings for any such purpose.
9.13 LOCAL BANK ACCOUNTS: The Borrower shall have the right to
maintain current accounts with Volksbank Hessisch-Lichtenau eG and/or
Kreissparkasse Kassel and/or Raiffeisenbank Spangenberg, Commerzbank Kassel,
Deutsche Bank Kassel, for the operation of its day-to-day business operations.
With the express prior and written consent of the Bank (which consent shall not
be unreasonably withheld) the Borrower shall have the right to open other
current accounts with other local banks for the operation of its day-to-day
business operations. Within two (2) weeks after the end of each calendar month
the Borrower shall (i) report to the Bank the balance on each of such local
current accounts by delivery to the Bank of the originals of the statements of
account received by the Borrower from such banks, and (ii) remit to its current
account with the Bank any credit balances standing on such local current
accounts which are in excess of an aggregate amount of DM 300,000.
10. REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Bank as follows:
10.1 INCORPORATION; EXISTENCE: The Borrower is a company with
limited liability (GmbH) duly established and validly existing under the laws of
the Federal Republic of Germany. True and complete copies of the Articles of
Association as well as of the extract from the Commercial Register of the
Borrower reflecting the current state of registrations and facts which require
registration will be delivered by the Borrower on or prior to the Disbursement
Date. The Borrower does not hold any participations (shares, voting rights,
silent partnerships, etc.) in any corporation, partnership, or other entity.
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10.2 AUTHORIZATION: The execution, delivery and performance of this
Agreement and the other Loan Documents to which the Borrower is or is to become
a party and the transactions contemplated hereby and thereby (i) are within the
corporate authority and legal right of the Borrower, (ii) have been duly
authorized by all necessary corporate proceedings, (iii) do not conflict with or
result in any breach or contravention of any provision of law, statute, rule or
regulation to which the Borrower is subject or any judgment, order, writ,
injunction, license or permit applicable to the Borrower, and (iv) do not
conflict with any provision of the Articles of Association of the Borrower of,
or any agreement or other instrument binding upon, the Borrower.
10.3 ENFORCEABILITY: The execution and delivery of this Agreement
and the other Loan Documents to which the Borrower is or is to become a party
will result in valid and legally binding obligations of the Borrower enforceable
against the Borrower in accordance with the respective terms and provisions
hereof and thereof, except as enforceability is limited by bankruptcy,
insolvency, reorganization, moratorium or other laws relating to or affecting
generally the enforcement of creditors' rights and except to the extent that
availability of the remedy of specific performance or injunctive relief is
subject to the discretion of the court before which any proceeding therefor may
be brought.
10.4 GOVERNMENTAL APPROVALS: The execution, delivery and
performance by the Borrower of this Agreement and the other Loan Documents to
which the Borrower is or is to become a party and the transactions contemplated
hereby and thereby do not require the Borrower to obtain the approval or consent
of, to make a filing with, or to perform or obtain the performance of any other
act by or in respect of any governmental agency or authority.
10.5 TITLE TO PROPERTIES; LEASES: Except for the assets
specifically excluded from the transfer of title for security purposes pursuant
to Exhibit 4 to the Security Transfer Agreement, the Borrower owns all of the
assets reflected in the As-If-Opening-Balance-Sheet of the Borrower as at the
Balance Sheet Date or acquired since that date (except property and assets sold
or otherwise disposed of in the ordinary course of business since that date),
subject to no rights of others, including any mortgages, land charges, leases,
conditional sales agreements, title retention agreements, liens, charges or
other encumbrances, except for Permitted Liens. The Borrower enjoys peaceful and
undisturbed possession under all leases under which it is operating, and all
said leases are valid and subsisting and in full force and effect.
10.6 FINANCIAL STATEMENTS; SOLVENCY:
10.6.1 The Borrower has furnished to the Bank the
As-If-Opening-Balance-Sheet as at the Balance Sheet Date. The
Als-Ob-Eroffnungsbilanz has been prepared in accordance with applicable
law and generally accepted accounting principles in Germany
consistently applied and is correct and complete in all material
respects and fairly presents the financial condition of the Borrower as
at the Balance Sheet Date. The Als-Ob-Eroffnungsbilanz has been
correctly translated into the As-If-Opening-Balance-Sheet in compliance
with U.S. formate and GAAP. There are no contingent liabilities of the
Borrower as of the Balance Sheet Date or incurred thereafter involving
material
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amounts, known to the Borrower and not disclosed in said balance sheets
and the related notes thereto.
10.6.2 The Borrower (both before and after giving effect to
the transactions contemplated hereby) is solvent, has assets having a
fair value in excess of the amount required to pay its probable
liabilities on its existing debts as they become absolute and matured,
and has, and will have, access to adequate capital for the conduct of
its business and the ability to pay its debts from time to time
incurred in connection therewith as such debts mature.
10.7 NO MATERIAL CHANGES, ETC.: Since the Balance Sheet Date there
has occurred (a) no materially adverse change in the financial condition or
business or prospects of the Borrower as shown on or reflected in the
As-If-Opening-Balance-Sheet as at the Balance Sheet Date, or (b) no change which
could reasonably be expected to affect materially and adversely the projections
of cash flow for the fiscal year ending December 31, 1993.
10.8 FRANCHISES, PATENTS, COPYRIGHTS, ETC.: The Borrower possesses
or has a valid right to use all franchises, patents, copyrights, inventions,
technology, trademark registrations, trademarks, trade names, trade secrets,
service marks, licenses and permits, and rights in respect of the foregoing and
patent and trademark applications and rights in respect thereto (collectively,
the "Proprietary Rights"), adequate for the conduct of its business
substantially as now conducted without known conflict with any rights of others.
The Borrower is not aware of any existing or threatened infringement or
misappropriation of (a) any Proprietary Rights of others, or (b) any Proprietary
Rights of the Borrower by others, in any way which could reasonably be expected
to have a material adverse effect on the business, assets or condition or
prospects, financial or otherwise, of the Borrower.
10.9 NO LITIGATION: There are no actions, suits, proceedings or
investigations of any kind with a value of DM 100,000 or more in the individual
case pending or, to the best of the Borrower's knowledge, threatened against the
Borrower before any court, tribunal or administrative agency or board that, if
adversely determined, could reasonably be expected, either in any case or in the
aggregate, to materially adversely affect the properties, assets, financial
condition or business or prospects of the Borrower or materially impair the
right of the Borrower to carry on business substantially as now conducted by it,
or result in any substantial liability not adequately covered by insurance, or
for which adequate reserves are not maintained on the balance sheet of the
Borrower, or which question the validity of this Agreement or any of the other
Loan Documents to which the Borrower is or is to become a party, or any action
taken or to be taken pursuant hereto or thereto.
10.10 NO MATERIALLY ADVERSE CONTRACTS, ETC.: The Borrower is not a
party to any contract or agreement that has or, to the best of the Borrower's
knowledge, is expected to have any materially adverse effect on the business or
prospects of the Borrower.
10.11 COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC.: The Borrower is
not in violation of any provision of its corporate documents, or any agreement
or instrument to which it is subject
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or by which it or any of its properties are bound, or any law, rule, regulation,
decree, order, judgment, statute license, in any of the foregoing cases in a
manner that could result in the imposition of substantial penalties or could
reasonably be expected to materially and adversely affect the financial
condition, properties or business of the Borrower or the Borrower's ability to
perform the obligations hereunder.
10.12 TAX STATUS: The Borrower (a) made or filed all tax returns
(including, without limitation, all VAT tax returns), reports and declarations
required by any jurisdiction to which it is subject, or properly filed for and
received extensions with respect thereto which are still in full force and
effect and which have been fully complied with in all material respects, (b)
paid all taxes and other governmental duties or charges shown or determined to
be due on such returns, reports and declarations, except those being contested
in good faith by appropriate proceedings and for which adequate reserves, to the
extent required by applicable law or generally accepted accounting principles in
Germany, have been established, and (c) set aside on its books provisions
reasonably adequate for the payment of all taxes for periods subsequent to the
periods to which such returns, reports or declarations apply. There are no
unpaid taxes or other governmental duties or charges in any material amount
claimed to be due by any taxing or other authority of any jurisdiction, and the
officers of the Borrower know of no basis for any such claim.
10.13 NO EVENT OF DEFAULT: No Event of Default has occurred and is
continuing.
10.14 ABSENCE OF FINANCING STATEMENTS, ETC.: Except with respect to
Permitted Liens, there is no financing statement, security agreement, real
estate mortgage or other document filed or recorded with any filing records,
registry or other public office, or otherwise created by the Borrower that
purports to cover, affect or give notice of any present or possible future lien
on, or security interest or charge in, any assets or property of the Borrower or
rights thereunder.
10.15 ARM'S LENGTH TRANSACTIONS: All transactions between the
Borrower and the Guarantors or any other affiliate are made and carried out upon
terms no more or less favourable than the Borrower could obtain from third
parties (arm's length).
10.16 REAL ESTATE: The Real Estate, the buildings erected thereon,
and all other fixtures and fittings thereof, have been properly maintained, and
no substantial maintenance or repair is outstanding. The buildings have been
erected in accordance with applicable formal and substantive building laws and
regulations, and comply with generally accepted standards of technique and
construction.
10.17 ENVIRONMENTAL COMPLIANCE:
10.17.1 The Borrower is not in violation of any judgment,
decree, order, law, license, rule or regulation pertaining to
environmental matters.
10.17.2 No portion of any of the Real Estate has been used
for the handling, processing, storage or disposal of hazardous
substances and no underground tank or other
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underground storage receptacle for hazardous substances is located on
such properties; (ii) in the course of its activities, the Borrower has
not generated or is generating any hazardous waste on any of the Real
Estate; and (iii) there have been no releases (i.e., any past or
present releasing, spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, disposing or
dumping) of hazardous substances by the Borrower on, upon or into any
of the Real Estate, which releases could have an adverse effect on the
value of such properties. In addition, to the best of the Borrower's
knowledge, there have been no such releases on, upon or into any real
property in the vicinity of any of the Real Estate that, through soil
or groundwater contamination, may be located on and that could
reasonably be expected to have a materially adverse effect on the value
of any of the Real Estate.
10.18 DISCLOSURE: No representation or warranty made by the Borrower
in this Agreement or any of the Loan Documents to which the Borrower is or is to
become a party or in any other document furnished from time to time in
connection herewith or therewith contains any misrepresentation of a material
fact or omits to state any material fact necessary to make the statements herein
or therein not misleading. There is no fact known to the Borrower that
materially adversely affects, the business, property or financial condition or
prospects of the Borrower.
10.19 REPETITION: Each of the above representations and warranties
will be correct and complied with in all respects at any point in time so long
as any sum remains to be lent or remains payable under this Agreement or any of
the Loan Documents to which the Borrower is or is to become a party as if
repeated by reference to the then existing circumstances, except that each
reference to Financial Statements in Clause 10.6 shall be construed as a
reference to the then latest available annual financial statements.
11. SURVIVAL OF COVENANTS; DISCLOSURE
11.1 SURVIVAL OF COVENANTS: All covenants, agreements,
representations and warranties made herein, in any of the other Loan Documents
or in any documents or other papers delivered by or on behalf of the Borrower
pursuant thereto shall be deemed to have been relied upon by the Bank,
notwithstanding any investigation heretofore or hereafter made by it, and shall
survive the making by the Bank of the Term Loan or other extension of credit, as
herein contemplated, and shall continue in full force and effect so long as any
obligation of the Borrower under this Agreement or any Loan Document remains
outstanding or the Bank has any obligation to extend credit thereunder. All
statements contained in any certificate or other paper delivered to the Bank at
any time by or on behalf of the Borrower pursuant hereto or in connection with
the transactions contemplated hereby shall constitute representations and
warranties by the Borrower hereunder.
11.2 DISCLOSURE: The circumstances correctly and completely
disclosed in SCHEDULE 3 hereto shall not constitute a breach of any of the
representations and warranties set forth in Clause 10 above, provided, however,
that (i) the storing and ground tanks described in items 2 and 3 of Schedule 3
are not in violation of the representations and warranties given in Clause
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10.17.1 above, and (ii) if any of the circumstances described in item 1 of
Schedule 3 individually, or all of the circumstances described in item 1 of
Schedule 3 in the aggregate, require the Borrower to spend (as capital
expenditure, fine, fees, or otherwise) an amount or amounts in the aggregate of
DM 150,000 or more, the circumstances or any of them shall, although disclosed,
constitute an Event of Default in the meaning of Clause 12 below.
12. DEFAULT
12.1 EVENTS OF DEFAULT: Each of the following events shall
constitute an Event of Default:
12.1.1 NON-PAYMENT: The Borrower will not pay when and in
the manner provided in this Agreement or any other Loan Document to
which the Borrower is or is to become a party any sums payable to the
Bank.
12.1.2 BREACH OF WARRANTY: Any representation, warranty or
statement by the Borrower in this Agreement or any other Loan Document
to which the Borrower is or is to become a party is not complied with
or is or proves to have been incorrect in any respect when made or, if
it had been made on a later date by reference to the circumstances then
existing, would have been incorrect in any respect on that later date,
provided, that in the event of a breach of any of the warranties
specified in Clause 10.5 or 10.17 (which breach must not have a value
of DM 100,000 or more in the individual case) the Borrower shall have
the right to cure the breach within two (2) weeks upon becoming aware
thereof exercising the care of a prudent businessman.
12.1.3 BREACH OF UNDERTAKING: The Borrower will not perform
or comply with any one or more of its obligations under Clause 9 above,
provided, that in the event of a breach of the covenants undertaken by
the Borrower in Clause 9.6 above (which breach must not have a value of
DM 100,000 or more in the individual case) the Borrower shall have the
right to cure the breach within two (2) weeks upon becoming aware
thereof exercising the care of a prudent businessman.
12.1.4 BREACH OF OTHER OBLIGATION: The Borrower will not
perform or comply with any one or more of its other obligations under
or in connection with this Agreement or any of the other Loan Documents
to which the Borrower is or is to become a party, except for minor
defects which shall be cured by the Borrower promptly upon the
occurrence thereof.
12.1.5 BREACH OF GUARANTEE; CROSS DEFAULT: Any of the
Guarantors will not perform or comply with any one or more of its
obligations under or in connection with the Guarantee or any other
contract, agreement, or other arrangement with the Bank; or any
condition or event will occur which constitutes a default or which,
with the giving of notice or the lapse of time, or both, constitutes a
default under the terms of the Fleet Agreement or the MCRC Agreement.
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12.1.6 SHAREHOLDER OF THE BORROWER: The Borrower ceases to
be a directly or indirectly wholly owned subsidiary of Simonds
Industries Inc.
12.1.7 INSOLVENCY: The Borrower or any of the Guarantors
becomes insolvent, is unable to pay its debts as they fall due, stops,
suspends or threatens to stop or suspend payment of all or a material
part of its debts, begins negotiations or takes any proceedings or
other step with a view to re-adjustment, rescheduling or deferral of
all of its indebtedness (or of any part of its indebtedness which it
will or might otherwise be unable to pay when due) or proposes or makes
a general assignment or an arrangement or composition with or for the
benefit of its creditors or a moratorium is agreed or declared in
respect of or affecting all or a material part of the indebtedness of
the Borrower or any of the Guarantors.
12.1.8 SECURITY ENFORCEABLE: Any present or future security
on or over the assets of the Borrower or any of the Guarantors becomes
enforceable.
12.1.9 DISSOLUTION: Any step is taken by any person for the
dissolution or bankruptcy or composition proceedings of the Borrower or
any of the Guarantors or for the appointment of a receiver, trustee or
similar officer of the Borrower or any of the Guarantors or of any of
their respective assets.
12.1.10 AUTHORIZATIONS AND CONSENTS: Any action or condition
at any time required to be taken, fulfilled or done for any of the
purposes of this Agreement or any of the Loan Documents is not taken,
fulfilled or done or any such consent is not complied with.
12.1.11 ANALOGOUS EVENTS: Any event occurs which, under the
law of any relevant jurisdiction, has an analogous or equivalent effect
to any of the events specified in this Clause 12.
12.1.12 MATERIAL ADVERSE CHANGE: Any event occurs or
circumstances arise which give(s) reasonable grounds in the opinion of
the Bank for believing that the Borrower or any of the Guarantors may
not (or may be unable to) perform or comply with any one or more of
their respective obligations under this Agreement, the Guarantee or any
other Loan Document.
12.1.13 FAILURE TO REFINANCE: Volksbank Spangenberg
Zweigniederlassung der Volksbank Hessisch-Lichtenau eG will not, in
form and contents satisfactory to the Bank, execute the Assignment of
Land Charges Hessisch-Lichtenau and the statement pursuant to Clause
3.2.1 within two (2) weeks from the date of this Agreement.
12.2 CANCELLATION/ACCELERATION: At any time upon the occurrence of
an Event of Default and for as long as the same remains to be continuing, the
Bank shall be entitled, by written notice to the Borrower to declare:
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12.2.1 the Working Capital Line Facility to be cancelled,
whereupon it shall be cancelled; and/or
12.2.2 the Term Loan and any amounts outstanding under the
Working Capital Line Facility to be immediately due and payable,
whereupon they shall become so due and payable.
13. EXPENSES
Whether or not the Term Loan or any amounts under the Working Capital
Line Facility will be disbursed under this Agreement, the Borrower shall pay:
13.1 INITIAL EXPENSES: on demand, all costs and expenses (including
taxes thereon and fees for legal and other professional advisers) incurred by
the Bank in connection with the preparation, negotiation, entering into of this
Agreement and the other Loan Document and/or any amendment of or waiver in
respect of this Agreement and the other Loan Document; and
13.2 ENFORCEMENT EXPENSES: on demand, all costs and expenses
(including taxes thereon and fees for legal and other professional advisers)
incurred by the Bank in protecting or enforcing any rights under or in
connection with this Agreement and/or the other Loan Documents and/or any
amendment or waiver thereof.
14. ASSIGNMENT
14.1 BENEFIT AND BURDEN OF THIS AGREEMENT: This Agreement and the
other Loan Documents shall benefit and be binding on the parties, their
respective successors and any permitted assignee or transferee of some or all of
a party's rights or obligations thereunder. Any reference in this Agreement to
any party shall be construed accordingly.
14.2 BORROWER: The Borrower may not assign or transfer all or part
of its rights or obligations under this Agreement or any other Loan Document to
which the Borrower is or is to become a party.
14.3 BANK: The Bank may assign or otherwise transfer its rights and
obligations under this Agreement and the other Loan Documents, or sell
participations in any interest therein, to any other person or entity, and such
other person or entity shall thereupon become vested, to the extent set forth in
the agreement evidencing such assignment, transfer or participation, with all
the rights and obligations of the Bank in respect thereof. However, under no
circumstances shall the Bank (i) hold less than 50% of the total outstandings
from the Borrower under or in connection with this Agreement at the time of the
assignment, transfer or sale of participation, or (ii) substitute any other
institution as the agent (of a group of lenders) for purposes of this Agreement.
15. COMMUNICATIONS
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15.1 ADDRESSES: Each communication under this Agreement shall be
made by telex, telefax (to be followed by a hard copy) or otherwise in writing.
Each communication or document to be delivered to any party under this Agreement
shall be sent to that party at the telex or telefax number or address, and
marked for the attention of the person (if any), from time to time designated by
that party to the other party. The initial telex or telefax number, address and
person (if any) so designated by each party are as follows:
THE BORROWER: WESPA Metallsagenfabrik
Simonds Industries GmbH
Lochmuhle 3
3509 Spangenberg
Telex Nr.: 99939 wespa d
Telefax Nr.: 05663/50666
Attn.: Geschaftsfuhrung
THE BANK: The First National Bank of Boston
Zweigniederlassung Frankfurt
Friedrich-Ebert-Anlage 2-14
(City-Haus)
6000 Frankfurt am Main
Telefax Nr.: 069/7545-240
Attn.: Commercial Banking
15.2 LANGUAGE: All communications and documents shall be in
English.
16. MISCELLANEOUS
16.1 CONDITION PRECEDENT: The validity and becoming effective of
this Agreement is conditional upon the execution, in form and substance
satisfactory to the Bank, of an intercreditor agreement between the Bank (Boston
Office) and Fleet Bank of Massachusetts, N.A.
16.2 NO IMPLIED WAIVERS, REMEDIES CUMULATIVE: No failure on the
part of the Bank to exercise, and no delay on its part in exercising, any right
or remedy under this Agreement or the other Loan Documents will operate as a
waiver thereof, nor will any single or partial exercise of any right or remedy
preclude any other or further exercise thereof or the exercise of any other
right or remedy. The rights and remedies provided in this Agreement or the other
Loan Documents are cumulative and not exclusive of any rights or remedies
provided by law.
16.3 FORM: This Agreement supersedes all prior negotiations and
agreements between the parties concerning the subject matter of this Agreement
and can be modified or amended only by written instrument signed by all parties
unless a stricter form is required by mandatory law. This form requirement shall
also apply to any change, modification or waiver of the form requirement set
forth in the preceding sentence.
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16.4 SEVERABILITY: Should any or several provisions of this
Agreement be or become invalid or impracticable in whole or in part, this shall
not affect the validity of the remaining provisions of this Agreement. In this
event, the invalid or impracticable provision is deemed replaced by a provision
which corresponds to the spirit and the purpose of the invalid or impracticable
provision to the greatest extent possible. In the event of gaps in this
Agreement, if any, the gap shall be deemed filled by such provisions which the
parties would have reasonably agreed upon in the light of the spirit and purpose
reflected in this Agreement had they been aware of the gap at the outset.
16.5 COUNTERPARTS: This Agreement may be signed in any number of
counterparts, all of which taken together and when delivered to the Bank shall
constitute one and the same instrument.
16.6 GENERAL BUSINESS TERMS: To the extent no provision has been
made in this Agreement, the General Business Terms of the Bank shall apply to
this Agreement a copy of which is attached hereto as SCHEDULE 4.
16.7 GOVERNING LAW: This Agreement shall be governed by and
construed in accordance with the laws of the Federal Republic of Germany.
16.8 JURISDICTION: In relation to any legal action or proceedings
arising out of or in connection with this Agreement, the Borrower irrevocably
and for the benefit of the Bank submits to the jurisdiction of the District
Court (Landgericht) in Frankfurt am Main.
16.9 SUBMISSION NOT TO AFFECT: This submission shall not affect the
right of the Bank to take proceedings in any other competent jurisdiction.
16.10 SERVICE OF PROCESS: The Borrower hereby accepts its
appointment as agent for service of process for Simonds Holding Company Inc. or
Simonds Industries Inc. in certain of the Loan Documents.
WESPA Metallsagenfabrik Simonds Industries GmbH by:
/s/
- -----------------------------------------
The First National Bank of Boston by:
/s/
- -----------------------------------------
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