March 31, 1999
MS Acquisition Corp. 24331 Sherwood Centerline, MI 48015
RE: $10,000,000 REVOLVING CREDIT
Gentlemen:
The terms and conditions under which NBD Bank (the "Bank") may make loans to MS Acquisition Corp., a Delaware corporation (the "Company"), are as follows:
1. Definitions. As used herein the following terms shall have the following respective meanings:
"Aetna" shall mean Aetna Industries, Inc., a Delaware corporation.
"Aetna Holdings" shall mean Aetna Holdngs, Inc., a Delaware corporation.
"Business Day" shall mean a day other than a Saturday, Sunday or other day on which the Bank is not open to the public for carrying on substantially all of its banking functions.
"Capital Stock" shall mean (i) in the case of any corporation, all capital stock and any securities exchangeable for or convertible into capital stock, (ii) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock in or to such association or entity, (iii) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited) and (iv) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distribution of assets of, the issuing Person, and including, in all of the foregoing cases described in clauses (i), (ii), (iii) or (iv), any warrants, rights or other options to purchase or otherwise acquire any of the interests described in any of the foregoing cases.
"Commitment" shall have the meaning ascribed thereto in Section 2.
"Debt" of any person shall mean, as of any date (a) all obligations of such person for borrowed money, (b) all obligations of such person as lessee under any capital lease, (c) all obligations which are secured by any Lien existing on any asset or property of such person whether or not the obligation secured thereby shall have been assumed by such person, provided, however, that Debt under this clause (c) shall not include indebtedness or obligations secured by the interest of any lessor of real property in which such person has a leasehold interest, as long as such indebtedness or obligation is solely the indebtedness or obligation of such lessor or a third party and not of such person, (d) the unpaid purchase price for goods, property or services acquired by such person, except for trade accounts payable and similar unsecured obligations arising in the ordinary course of business that are not materially past due, (e) all liabilities of such person in respect of unfunded liabilities under any pension plan of such person or of or for which such person is liable, (f) all obligations of such person in respect of any interest
2
rate or currency swap, rate cap or other similar transaction (valued in an amount equal to the highest termination payment, if any, that would be payable by such person upon termination for any reason on the date of determination), and (g) all obligations of others similar in character to those described in clauses (a) through (f) of this definition for which such person is contingently liable, as obligator, guarantor, surety or in any other capacity, or in respect of which obligations such person assures a creditor against loss or agrees to take any action to prevent any such loss (other than endorsements of negotiable instruments for collection in the ordinary course of business), including without limitation all reimbursement obligations of such person in respect of letters of credit, surety bonds or similar obligations and (h) all obligations of such person to advance funds to, or to purchase assets, property or services from, any other person in order to maintain the financial condition of such other person.
"Dollars" and "$" shall mean the lawful money of the United States of America.
"Eurodollar Business Day" shall mean, with respect to any Eurodollar Rate Loan, a day which is both a Business Day and a day on which dealings in Dollar deposits are carried out in the London interbank market.
"Eurodollar Interest Period" shall mean, with respect to any Eurodollar Rate Loan, the period commencing on the day such Eurodollar Rate Loan is made or converted to a Eurodollar Rate Loan and ending on the day which is one or two months thereafter, as the Company may elect, and each subsequent period commencing on the last day of the immediately preceding Eurodollar Interest Period and ending on the day which is one or two months thereafter, as the Company may elect, provided, however, that (a) any Eurodollar Interest Period which commences on the last Eurodollar Business Day of a calendar month (or on any day for which there is no numerically corresponding day in the appropriate subsequent calendar month) shall end on the last Eurodollar Business Day of the appropriate subsequent calendar month, (b) each Eurodollar Interest Period which would otherwise end on a day which is not a Eurodollar Business Day shall end on the next succeeding Eurodollar Business Day or, if such next succeeding Eurodollar Business Day falls in the next succeeding calendar month, on the next preceding Eurodollar Business Day, and (c) no Eurodollar Interest Period shall be permitted which would end after the Termination Date.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Rate Loan and the related Eurodollar Interest Period, the per annum rate that is equal to the sum of:
(a) 250 basis points, plus
(b) the rate per annum obtained by dividing (i) the per annum rate of interest at which deposits in Dollars for such Eurodollar Interest Period and in an aggregate amount comparable to the amount of such Eurodollar Rate Loan to be made hereunder are offered to the Bank by other prime banks in the London interbank market at approximately 11:00 a.m. London time on the second Eurodollar Business Day prior to the first day of such Eurodollar Interest Period by (ii) an amount equal to one minus the stated maximum rate (expressed as a decimal) of all reserve requirements (including, without limitation, any marginal, emergency, supplemental, special or other reserves) that are specified on the first day of such Eurodollar Interest Period by the Board of Governors of the Federal Reserve System (or any successor agency thereto) for determining the maximum reserve requirement with respect to eurocurrency funding (currently referred to as "Eurocurrency liabilities" in Regulation D of such Board) maintained by a member bank of such System; all as conclusively determined by the Bank, such sum to be rounded up, if necessary, to the nearest whole multiple of one one-hundredth of one percent (1/100 of 1%).
"Eurodollar Rate Loan" shall mean any Loan which bears interest at the Eurodollar Rate.
3
"Event of Default" shall mean any of the events or conditions described in paragraph 9.
"Federal Funds Rate" shall mean the per annum rate determined by the Bank from time to time as the opening Federal Funds Rate paid or payable by the Bank in its regional Federal Funds market for overnight borrowings from other banks.
"Floating Rate" shall mean the per annum rate equal to the greater of (a) one percent (1%) per annum plus the Federal Funds Rate in effect from time to time, or (b) the Prime Rate in effect from time to time; which Floating Rate shall change simultaneously with any change in such Prime Rate or Federal Funds Rate.
"Generally Accepted Accounting Principles" shall mean generally accepted accounting principles applied on a basis consistent with that reflected in the most recent financial statements of the Company submitted to the Bank prior to the date hereof.
"Lien" shall mean any pledge, assignment, hypothecation, mortgage, security interest, deposit arrangement, option, conditional sale or title retaining contract, sale and leaseback transaction, lessor's or lessee's interest under any lease, subordination of any claim or right, or any other type of lien, charge or encumbrance.
"Loan" shall mean any borrowing pursuant hereto.
"Loan Documents" shall mean this letter agreement, the Note, the Security Documents and all other agreements and documents executed pursuant hereto at any time, in each case as amended or modified from time to time.
"Material Adverse Effect" shall mean a material adverse effect on (a) the business, assets, operations or condition (financial or otherwise) of the Company and its Subsidiaries on a consolidated basis, (b) the ability of the Company to perform its obligations under any Loan Document, or (c) the validity of enforceability of any Loan Document or the rights or remedies of the Bank under any Loan Document.
"Net Worth" shall mean, as of any date, the amount of any capital stock, paid in capital and similar equity accounts plus (or minus in the case of a deficit) the capital surplus and retained earnings of any Person, all in accordance with Generally Accepted Accounting Principles.
"Note" shall mean the demand promissory note of the Company evidencing the Loans, in the form annexed hereto as Exhibit A, as amended or modified from time to time and together with any promissory note or notes issued in exchange or replacement therefor.
"Overdue Rate" shall mean, with respect to principal and other amounts payable by the Company hereunder (other than interest), a rate per annum that is equal to the sum of two percent (2%) per annum plus the Floating Rate.
"Person" or "person" shall include an individual, a corporation, an association, a partnership, a trust or estate, a joint stock company, an unincorporated organization, a joint venture, a trade or business (whether or not incorporated), a government (foreign or domestic) and any agency or political subdivision thereof, or any other entity.
"Prime Rate" shall mean the per annum rate announced by the Bank from time to time as its "prime rate" (it being acknowledged that such announced rate may not necessarily be the lowest rate
4
charged by the Bank to any of its customers), which Prime Rate shall change simultaneously with any change in such announced rate.
"Prime Rate Loans" shall mean any Loan which bears interest at the Prime Rate.
"Security Documents" shall mean each pledge agreement and other collateral document executed in connection herewith which grants a lien or security interest and all other agreements and documents executed pursuant thereto at any time, in each case as amended or modified from time to time.
"SOFEDIT" shall mean Societe Financiere d' etudes de Developpement Industrial et Technologique, a French societe anonyme.
"Subsidiary" of any person shall mean any other person (whether now existing or hereafter organized or acquired) in which (other than directors qualifying shares required by law) at least a majority of the securities or other ownership interests of each class having ordinary voting power or analogous right (other than securities or other ownership interests which have such power or right only by reason of the happening of a contingency), at the time as of which any determination is being made, are owned, beneficially and of record, by such person or by one or more of the other Subsidiaries of such person or by any combination thereof. Unless otherwise specified, reference to "Subsidiary" shall mean a Subsidiary of the Company.
"Termination Date" shall mean the earliest to occur of (a) July 30, 1999, (b) the completion of any initial public offering by the Company or (b) the date the Loans are accelerated by the Bank pursuant to Section 9.
2. Loans.
(a) The Bank agrees, subject to the terms and conditions of this agreement, to make Loans to the Company, from time to time from and including the effective date of this letter to but excluding the Termination Date, not to exceed $10,000,000 in aggregate principal amount at any time outstanding (the commitment to make Loans in such amount and subject to such terms and conditions defined herein as the "Commitment"). The Loans shall be used to make equity contributions or, if permitted, subordination loans to Aetna. The Loans shall be evidenced by the Note, payable on the Termination Date. The Company may at any time voluntarily prepay all or any part of the Loans outstanding at such time (including any interest payable thereon), without premium or penalty, provided that any Eurodollar Rate Loan may not be prepaid prior to the end of the Eurodollar Interest Period with respect thereto.
(b) The Company agrees to pay to the Bank a commitment fee on the daily average unused amount of the Commitment, for the period from the date hereof to but excluding the Termination Date, at a rate equal to one half of one percent (1/2%) per annum. Accrued commitment fee shall be payable on the last Business Day of each month and on the Termination Date.
(c) Interest shall be payable on the Loans prior to the Termination Date at the Prime Rate or the Eurodollar Rate, as elected by the Company hereunder. Interest shall be payable after the Termination Date on demand by the Bank at the Overdue Rate. Unless earlier payment is required hereunder, interest will be payable on the last day of each month with respect to Prime Rate Loans and the last day of the relevant Eurodollar Interest Period with respect to all Eurodollar Rate Loans and on the Termination Date.
5
(d) The Company shall give the Bank a verbal request, followed immediately by a written request if required by the Bank, for each requested Loan not later than 11:00 a.m. Detroit time (or such later time agreed to by the Bank) on the Business Day such Loan is requested to be made if such Loan is a Prime Rate Loan and on the date three Eurodollar Business Days prior to the date such Loan is requested to be made if such Loan is a Eurodollar Rate Loan. Each request for a Eurodollar Rate Loan shall be in a minimum amount of $1,000,000 and in integral multiples thereof, and shall also specify the allowable Eurodollar Interest Period with respect thereto. The Bank may rely on all verbal requests from any officer or other authorized person of the Company. Each request for a Loan shall constitute a representation by the Company, and it is a condition precedent to obtaining a Loan, that both before and after giving effect to such Loan all the representations and warranties contained in Section 7 hereof are true and accurate on the date each Loan is to be made as if made on and as of such date and that no Event of Default, or event or condition which may become an Event of Default after notice or lapse time or both, has occurred and is continuing.
(e) The Company may elect to continue a Eurodollar Rate Loan as a Eurodollar Rate Loan, or may elect to conver ...
*End of Preview*
Click the 'Add to Cart' button to download the complete and formatted agreement.