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TVI CORP
·
8-K
May 22, 4:55 PM ET
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TVI CORP 8-K
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Contents
82
ARTICLE I
DEFINITIONS
(a) All references to the term “Collateral” in any of the Financing Documents or any other term referring to the security for the Pre-Petition Obligations in any of the Financing Documents shall be deemed, and each such reference is hereby amended to mean, collectively, the Pre-Petition Collateral and the Post-Petition Collateral.
(b) All references to the Debtors, including, without limitation, to the terms “Borrower”, “Borrowers”, “Debtor” or “Debtors” in any of the Financing Documents, shall be deemed and each such reference is hereby amended to mean and include each Person included in the term “Debtors” as defined by this Agreement, jointly and severally, unless a
specific Debtor is expressly identified, and their respective successors and assigns (including any trustee or other fiduciary hereafter appointed as its legal representative or with respect to the property of the estate of such corporation whether under Chapter 11 of the Bankruptcy Code or any subsequent Chapter 7 case and its successor upon conclusion of the Chapter 11 Case of such corporation).
(c) All references to the term “Financing Documents” in any of the Financing Documents shall be deemed to include, and each such reference is hereby amended to include, in addition and not in limitation, this Agreement, all of the Financing Documents as ratified, assumed and adopted by the Debtors pursuant to the terms hereof, as amended and supplemented hereby, and the Financing Order, as each of the same now exists or may hereafter be amended, modified, supplemented extended, renewed, restated or replaced.
(d) All references to the term “Financing Agreement” in any of the Financing Documents shall be deemed to mean, and each such reference is hereby amended to mean, the Financing Agreement, as defined herein and amended hereby and ratified, assumed and adopted by the Debtors pursuant to the terms hereof and the Financing Order, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.
(e) All references to the term “Obligations” in this Agreement and in any of the Financing Documents shall be deemed to mean, and each such reference in the Financing Documents is hereby amended to mean, both the Pre-Petition Obligations and the Post-Petition Obligations.
(f) All references to the term “Revolving Loan” in any of the Financing Documents shall be deemed to mean, and each such reference is hereby amended to mean, the Revolving Loan, as defined in the Financing Agreement and amended hereby and ratified, assumed and adopted by the Debtors pursuant to the terms hereof and the Financing Order, as the same now exists or may hereafter be amended, modified, supplemented, extended, renewed, restated or replaced, all whether the Obligations with respect thereto constitute Pre-Petition Obligations or Post-Petition Obligations.
(a) For purposes of this Agreement, unless otherwise defined or amended herein, including, but not limited to, those terms used and/or defined in the Preamble and Recitals hereto, all terms used herein shall have the respective meanings assigned to such terms in the Financing Agreement.
(b) All references to the terms “Lender”, or any other Person pursuant to the definitions in the Preamble and Recitals hereto, or otherwise, shall include its respective successor and assigns.
(c) All references to any term in the singular shall include the plural and all references to any term in the plural shall include the singular.
(d) All terms not specifically defined herein which are defined in the Uniform Commercial Code of the State of Maryland shall have the meaning set forth therein, except that the term, “Lien” or “lien” shall have the meaning set forth in Section 101(37) of the Bankruptcy Code.
ARTICLE II
ACKNOWLEDGEMENT
(a) The unpaid balance of the Loans as of the close of business on March 31, 2009 are, respectively, as follows:
(b) The Pre-Petition Obligations also include unpaid fees and expenses due and owing to the Lender, including, without limitation, unpaid reasonable attorneys’ fees and expenses incurred by the Lender in connection with the Forbearance Agreement and related Financing Documents, the collection and enforcement of the Pre-Petition Obligations, to the extent the same are permitted by the of the Financing Documents and/or applicable Laws. Without limiting the foregoing, (i) the Debtors hereby authorize the Lender to pay Lender’s reasonable counsel’s fees and expenses as part of the Pre-Petition Obligations by debit to the Revolving Loan in the manner provided by Section 2.1.2 (Procedure for Making Advances Under the Revolving Loan; Lender Protection Advances) of the Financing Agreement and (ii) the Debtors hereby acknowledge, confirm and agree that the Debtors shall pay (whether by debit to the Revolving Loan or otherwise) all such fees and expenses upon demand, whether or not such fees and expenses are included in, or otherwise made a part of, the Budget.
(c) Subject to the effect of the Financing Order, each of the Debtors agrees that there does not exist (or to the extent that there does exist, each of the Debtors hereby irrevocably waives and releases) any defense or right of set-off, recoupment or counterclaim to the payment when due of those amounts due under the Loans or any of the other Pre-Petition Obligations, and that there does not exist (or to the extent that there does exist, each of the Debtors hereby irrevocably waives and releases) any other claim against the Lender with respect to the Loans, the Notes, the Pre-Petition Obligations, or otherwise. Each Debtor hereby releases, acquits and forever discharges each of the Lender, its respective officers, employees,
and agents, from any and all claims, actions, causes of action, demands, rights, damages, costs, loss of services, expenses and compensation whatsoever, which any of the Debtors now have, or which may have accrued prior to the date of this Agreement, or which arise from, relate to, may arise from, may relate to or are in any way are connected to any set of facts, situations, acts or omissions of any person or entity (including, without limitation, the Lender, its respective officers, employees, and agents) prior to the date of this Agreement, in each case, whether known or unknown by any or all of the Debtors, on account of or that in any way arise out of or result from any of the Pre-Petition Obligations, this Agreement, any of the other Financing Documents, any of the transactions, duties or obligations arising under or relating to any of the Pre-Petition Obligations, this Agreement, any of the other Financing Documents, or any other agreements, transactions, duties or obligations, or facts whatsoever, whether related to the Pre-Petition Obligations, this Agreement, any of the other Financing Documents or otherwise, whether arising in contract or tort, in law or in equity. Without limiting the foregoing, each Debtor hereby specifically releases, acquits and forever discharges each of the Lender, its respective officers, employees, and agents, from any and all contract or common law claims, and avoidance actions under 11 U.S.C. Sections 542, 544, 545, 547, 548, 549, 550, or 553 if any, against Lender arising from or related to the Financing Documents, including, without limitation, this Agreement.
ARTICLE III
ADOPTION AND RATIFICATION
ARTICLE IV
GRANT OF SECURITY INTEREST
ARTICLE V
ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS
ARTICLE VI
OTHER CONDITIONS.
(a) All Revolving Loans and credit accommodations provided by the Lender to the Debtors pursuant to the Financing Order, the Financing Agreement, the Financing Documents, or otherwise, shall be used by the Debtors strictly in accordance with the Budget, and the Debtors shall not make any payment of any expense or make any other payment to the extent actual expenses exceed, or would exceed after giving effect to any proposed payment on a pro-forma basis, the amount set forth in any line item in the Budget, except as permitted by Section 6.5(c) of this Agreement and except for Enforcement Costs (which Enforcement Costs shall be due and payable on demand). The Debtors acknowledge that the Budget that is attached
to the Interim Financing Order (as such Budget may be amended, modified, substituted, replaced or otherwise modified with Lender’s prior written consent, to be given or withheld in Lender’s sole and absolute discretion, the “Existing Budget”) only contains consolidated cash flow projections, Borrowing Base projections and Bridge Amount projections and other financial information respecting the Debtors through and including June 26, 2009. On or before June 15, 2009, the Debtors shall provide the Lender with a new budget covering the period from and including June 27, 2009 through and including October 2, 2009 (as such Budget may be amended, modified, substituted, replaced or otherwise modified with Lender’s prior written consent, to be given or withheld in Lender’s sole and absolute discretion, the “New Budget”), which New Budget shall be in the same format and contain the same detail as the Existing Budget. The New Budget shall be acceptable to the Lender in its sole and absolute discretion, and the Lender shall have no obligation to continue to provide any financing or credit accommodation to the Debtors under the Financing Order, this Agreement, the Financing Agreement, the Financing Documents, or otherwise, if the New Budget is not acceptable to the Lender in its sole and absolute discretion.
(b) The Debtors and the Lender hereby agree that the Debtors shall, within five (5) Business Days of being awarded each Additional Material Contract (that meets all of the criteria set forth in the Financing Agreement and, without limitation, is acceptable to the Lender in the exercise of its sole and absolute discretion) and at the time of the Debtors’ proposal of any of the Signature TVI Operational Events, submit a revised and adjusted Budget to the Lender for the Lender’s review and consideration. Provided that such revised and adjusted Budget is acceptable to the Lender in its sole and absolute discretion and, without limiting that discretion of the Lender, does not extend the period covered by the Budget, the Lender shall substitute such revised and adjusted Budget and such revised and adjusted Budget shall become the “Budget” for the purposes set forth in this Agreement, the Financing Order and the other Financing Documents.
(a) By not later May 8, 2009, unless such date is expressly extended by the Lender in writing in its sole and absolute discretion, the Debtors hereby agree to engage an investment banker (the “Investment Banker”), whose experience, reputation and otherwise is reasonably acceptable to the Lender, to value the Debtors’ business. The Debtors hereby agree that, prior to engaging such Investment Banker, they shall provide the Lender with the proposed engagement letter. The Debtors agree that they will not enter into such an engagement unless the Investment Banker and the terms of the engagement of the Investment Banker (including, without limitation, any and all commissions, fees, and other amounts payable, exclusivity and tail) shall be acceptable to the Lender in the exercise of its reasonable discretion.
(b) The Debtors hereby agree that the Lender may discuss with the Investment Banker the affairs, finances, valuation and prospects of the Debtors and shall have complete, direct and immediate access to the representatives, employees and agents of the Investment Banker and its reports, projects, estimates, work papers, recommendations, assessments and other information and conclusions relating in any way to the Debtors, without the further consent or approval of the Debtors. Without implying any limitation on the foregoing, the Debtors acknowlege and agree that such access to the Investment Banker is a material inducement to the Lender to enter into this Agreement. Without implying any limitation on the foregoing, the Investment Banker’s engagement letter shall contain the Investment Banker’s agreement to cooperate fully with the Lender in effecting such access.
(c) Each of the Debtors hereby irrevocably authorizes and directs the Investment Banker and the representatives, employees and agents of the Investment Banker to exhibit and deliver to the Lender any and all of its reports, valuations, estimates, projects, budgets, work papers, recommendations, assessments and other information and conclusions and to discuss candidly the same with the Lender, without the further consent or approval of any of the Debtors. The Lender acknowledges that the engagement of the Investment Banker is the sole responsibility of the Debtor and all reports, valuations, assessments and related working papers that come into the possession of Lender are the property of the Debtors, provided that the Debtors and the Investment Banker shall nonetheless allow the Lender unrestricted access to the same.
(d) Notwithstanding the foregoing, the Debtors and/or the Investment Banker shall have no duty to disclose specific information to the extent, if any, that the Debtors and/or the Investment Banker on behalf of the Debtors asserts that such specific information is subject to the attorney-client privilege. If the Debtors and/or the Investment Banker on behalf of the Debtors asserts that any such specific information is subject to attorney-client privilege, then the Debtors and/or the Investment Banker shall maintain a privilege log with respect to information subject to a claim of attorney-client privilege, which shall contain (a) the date of the document or information, (b) the type of document or information, (c) the basis for withholding the document or information, and (d) the subject of the document or information. The inadvertent production by the Debtors and/or the Investment Banker of information subject to a claim of attorney-client privilege shall not be deemed a waiver or forfeiture of any claim of privilege that the Debtors would otherwise be entitled to assert with respect to the inadvertently disclosed protected information and its subject matter, as long as the producing party promptly after discovery notifies the Lender in writing of the claim or privilege. Upon such notice, the Lender shall destroy promptly all copies of the documents or information referred to and notify the producing party or person that it has done so. Within five (5) Business Days of the notification that such disclosed protected information has been returned or destroyed, the Debtors shall produce, or cause to be produced, a privilege log with respect to the disclosed protected information.
ARTICLE VII
APPLICATION OF PROCEEDS.
ARTICLE VIII
AMENDMENTS
(a) The Lender hereby acknowledges and agrees that all Liens in favor of the Lender, including, without limitation, all Liens in favor of the Lender securing all Pre-Petition Obligations and Post-Petition Obligations are hereby incorporated into the defined term “Permitted Liens”.
(b) Section 1.1 (Certain Defined Terms) of the Financing Agreement is hereby amended by deleting the following defined terms in their respective entirety, and replacing them, respectively, with the following:
(c) Section 1.1 (Certain Defined Terms) of the Financing Agreement is hereby amended by adding the following definitions in alphabetical order:
“Bridge” means the dollar amount that (a) Revolver Usage exceeds (b) the Borrowing Base minus the Bridge Borrowing Base Amount.
“Bridge Amount” means the Borrowers’ projection of the maximum Bridge for applicable weekly periods as determined from the Budget (as that term is defined in the Post-Petition Financing Agreement).
(d) All references to the outstanding principal balance of the Revolving Loan shall include all such amounts, whether part of the Pre-Petition Obligations or the Post-Petition Obligations.
(e) The following sentence is added to the end of Section 1.2 (Accounting Terms and Other Definitional Provisions) of the Financing Agreement:
All capitalized terms used but not defined in this Agreement shall have the meaning ascribed to them in the Post-Petition Financing Agreement.
(a) Subsection (a) of Section 2.1.3 (Computation of Borrowing Base) of the Financing Agreement is hereby deleted in its entirety and replaced with the following:
(a) As used in this Agreement, the term “Borrowing Base” means at any time, an amount equal to the aggregate of:
(i) eighty-five percent (85%) of the amount of the Eligible Receivables; plus
(ii) the lesser of (A) fifty percent (50%) of the amount of Eligible Inventory or (B) the sum of (1) Four Million Dollars ($4,000,000) plus (2) only for the term of an Additional Material Contract (as defined in the Post-Petition Financing Agreement), fifty percent (50%) of the amount of Eligible Inventory deriving from such Additional Material Contract that is projected in the revised and adjusted Budget which incorporates the applicable Additional Material Contract, plus
(iii) the Bridge Borrowing Base Amount for the applicable week;
subject to the adjustments provided in this Section 2.1 (Revolving Credit Facility) of this Agreement.
(b) Section 2.2.3 (Term Loan Payments) of the Financing Agreement is hereby deleted in its entirety and replaced with the following:
2.2.3 Term Loan Payments.
The Borrowers shall make interest payments on the Term Loan monthly as set forth in Section 2.5.3 (Payment of Interest) of this Agreement. If not sooner paid, the Term Loan shall mature on the Term Loan Maturity Date.
(c) Notwithstanding the provisions of Section 2.4 (The Letter of Credit Facility) of the Financing Agreement, the Debtors may not obtain additional Letters of Credit unless such Letters of Credit are fully secured by cash.
(d) Section 2.5.1 (Interest Rates) of the Financing Agreement is hereby deleted in its entirety and replaced with the following:
2.5.1 Interest Rates.
The Revolving Loan shall bear interest at the greater of (a) the Prime Rate plus two percent (2.0%) per annum or (b) five and one-quarter percent (5.25%) per annum.
The Term Loan shall bear interest at the greater of (a) the Prime Rate plus two percent (2.0%) per annum or (b) five and one-quarter percent (5.25%) per annum.
(e) Section 6.1.14 (Financial Covenants) of the Financing Agreement is hereby amended by deleting subsection (b) (Fixed Charge Coverage Ratio), subsection (c) (Funded Debt to EBITDA Ratio), subsection (d) (Operating Income), subsection (e) (Tangible Net Worth) and subsection (f) (EBITDA) in their entirety and replacing each of those subsections, respectively, with the words “Intentionally Deleted”.
(f) Section 6.1.1 (Financial Statements) of the Financing Agreement is hereby amended by adding the following as new subsection (f) (Bankruptcy Reports):
(g) Section 7.1 (Events of Default) of the Financing Agreement is hereby amended by adding the following as new subsection 7.1.14 (Additional Defaults):
(h) Section 8.1 (Notices) of the Financing Agreement is hereby amended by deleting the reference to the contact information for Debtors’ former legal counsel in its entirety and replacing such contact information with the following:
Joel M. Walker Duane Morris LLP Suite 5010 600 Grant Street Pittsburgh, Pennsylvania 15219-2811
and
Laurence S. Hughes Duane Morris LLP 1540 Broadway New York, New York 10036-4086
(i) The form of the Revolving Credit Note attached as Exhibit A-1 to the Financing Agreement is hereby deleted in its entirety and replaced with the form of Revolving Credit Note attached hereto as Schedule 2(B) (Form of Revolving Credit Note).
(j) The form of the Term Loan Note attached as Exhibit A-2 to the Financing Agreement is hereby deleted in its entirety and replaced with the form of Term Loan Note attached hereto as Schedule 2(B) (Form of Term Loan Note).
(k) The Disclosure Schedule attached as Exhibit E (Disclosure Schedule) to the Financing Agreement is hereby deleted in its entirety and replaced with the Disclosure Schedule attached hereto as Schedule 3 (Disclosure Schedule).
(l) Sections 1 (Forbearance), 2 (Financing Agreements), 3 (Covenants), 4 (Extension of Forbearance Period) and 5 (Default) of the Forbearance Agreement are each superceded and replaced by other terms and provisions of this Agreement as of the date of this Agreement and are of no further force and effect on or after the date of this Agreement.
(m) Clause (a) of the Acknowledgement and Agreement dated as of January 30, 2009 by and among the Lender and the Debtors is superceded and replaced by other terms and provisions of this Agreement as of the date of this Agreement and is of no further force or effect on or after the date of this Agreement.
ARTICLE IX
OTHER AGREEMENTS
Notwithstanding anything contained herein or in any of the other Financing Documents to the contrary, but without in any way limiting the Lender’s absolute right to approve the Financing Order in its sole and absolute discretion, the terms of this Agreement, the Financing Agreement and the other Financing Documents are subject to the terms and provisions of the Financing Order. In the event that any of the terms and provisions of this Agreement, the Financing Agreement or the other Financing Documents conflict with the terms and provisions set forth in the Financing Order, the terms and provisions set forth in the Financing Order shall
govern. Furthermore, notwithstanding anything contained herein or in any of the other Financing Documents to the contrary, in the event that any of the terms and provisions of this Agreement directly conflict with the terms and provisions set forth in any of the other documents or agreements contained in the defined term “Financing Agreement” or conflict with any of the terms and provisions set forth in the other Financing Documents, the terms and provisions set forth in this Agreement shall govern.
(a) Subject to the terms and provisions of Section 9.1 (Conditions of Lending) and Section 9.2 (Pre-Petition Defaults; Acceleration; No Waiver of Pre-Petition Defaults) of this Agreement, the parties hereto acknowledge, confirm and agree that the failure of the Debtors to comply with, any of the covenants, conditions and agreements contained herein or in any other agreement, document or instrument at any time executed by the Debtors in connection herewith (in each case, after giving effect to all applicable notice, cure or grace periods) shall constitute an Event of Default under the Financing Documents.
(b) Neither this Agreement nor any other instrument or document referred to herein or therein may be changed, waived, discharged or terminated orally, but only by an instrument in writing signed by the party against whom enforcement of the change waiver, discharge or termination is sought.
(c) The headings used herein are for convenience only and do not constitute matters to be considered in interpreting this Agreement.
(d) This Agreement may be executed in any number of duplicate originals or counterparts, each of such duplicate originals or counterparts shall be deemed to be an original and taken together shall constitute but one and the same instrument. The parties agree that their respective signatures may be delivered by facsimile. Any party who chooses to deliver its signature by facsimile agrees to provide promptly to the other parties a copy of this Agreement with its inked signature.
(e) This Agreement shall become effective upon the execution hereof by the Lender and each of the Debtors and the due entry of the Interim Financing Order, subject to the provisions hereof.
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