executive officers and directors of the Company shall also have agreed
not to sell publicly their Common Stock under the circumstances and
pursuant to the terms set forth in this Section 5.09.
5.10. PARTICIPATION IN REGISTRATIONS. No holder of Registrable
Shares may participate in any registration provided for hereunder unless
such holder: (a) has complied in all material respects with all of the
terms of this Agreement and (b) in the case of any underwritten
registration which includes Common Stock to be sold by Matec: (i) agrees
to sell such holders Registrable shares on the basis provided in any
underwriting arrangements entered into by Matec provided the terms
thereof are no less favorable to such holder than those accorded to
Matec, and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements
and this Agreement.
5.11. EXPENSES. In the case of a registration under Sections 5.01
or 5.02, Matec shall bear all costs and expenses of each such
registration, including, but not limited to, printing, legal and
accounting expenses, Commission filing fees and "blue sky" fees and
expenses; PROVIDED, HOWEVER, that Matec shall have no obligation to pay
or otherwise bear (i) any portion of the fees or disbursements of more
than one counsel for the selling holders of Registrable Shares in
connection with the registration of their Registrable Shares, or (ii)
any portion of the underwriters' commissions or discounts attributable
to the Registrable Shares being offered and sold by the holders of
Registrable Shares.
ARTICLE VI
EVENTS OF DEFAULT
6.01. EVENTS OF DEFAULT. If any of the following events ("Events
of Default") shall and be continuing:
(a) The Companies shall fail to pay any installment of
principal of any of the Notes when due; or
(b) The Companies shall fail to pay any interest or premium on
any of the Notes when due and such failure shall continue for five (5)
business days; or
(c) The Companies shall default in the performance of any
covenant contained in subsections 4.01(j) or (k) or shall default in the
performance of any covenant contained in Section 4.02; or
(d) Any representation or warranty made by any Company in this
Agreement or the Security Agreements or by any Company (or any officers
of any Company) in any certificate, instrument or written statement
contemplated by or made or delivered pursuant to or in connection with
this Agreement or the Security Agreements, shall prove to have been
incorrect when made in any material respect; or
(e) Any Company shall fail to perform or observe any other
term, covenant or agreement contained in this Agreement, the Notes, the
Warrants or the Security Agreements on its part to be performed or
observed and any such failure remains unremedied for ten (10) business
days after written notice thereof shall have been given to any Company
by any registered holder of the Notes; or
(f) Any Company or any Subsidiary shall fail to pay any
Indebtedness for borrowed money (other than as evidenced by the Notes)
owing by such Company or such Subsidiary (as the case may be), or any
interest or premium thereon, when due (or, if permitted by the terms of
the relevant document, within any applicable grace period), whether such
Indebtedness shall become due by scheduled maturity, by required
prepayment, by acceleration, by demand or otherwise, or shall fail to
perform any term, covenant or agreement on its part to be performed
under any agreement or instrument (other than this Agreement or the
Notes) evidencing or securing or relating to any Indebtedness owing by
any Company or any Subsidiary, as the case may be, when required to be
performed (or, if permitted by the terms of the relevant document,
within any applicable grace period), if the effect of such failure to
pay or perform is to accelerate, or to permit the holder or holders of
such Indebtedness, or the trustee or trustees under any such agreement
or instrument to accelerate, the maturity of such Indebtedness, unless
such failure to pay or perform shall be waived by the holder or holders
of such Indebtedness or such trustee or trustees; or
(g) Any Company or any Subsidiary shall be involved in
financial difficulties as evidenced (i) by its admitting in writing its
inability to pay its debts generally as they become due; (ii) by its
commencement of a voluntary case under Title 11 of the United States
Code as from time to time in effect, or by its authorizing, by
appropriate proceedings of its Board of Directors or other governing
body, the commencement of such a voluntary case; (iii) by its filing an
answer or other pleading admitting or failing to deny the material
allegations of a petition filed against it commencing an involuntary
case under said Title 11, or seeking, consenting to or acquiescing in
the relief therein provided, or by its failing to controvert timely the
material allegations of any such petition; (iv) by the entry of an order
for relief in any involuntary case commenced under said Title 11; (v) by
its seeking relief as a debtor under any applicable law, other than said
Title 11, of any jurisdiction relating to the liquidation or
reorganization of debtors or to the modification or alteration of the
rights of creditors, or by its consenting to or acquiescing in such
relief; (vi) by the entry of an order by a court of competent
jurisdiction (a) finding it to be bankrupt or insolvent, (b) ordering or
approving its liquidation, reorganization or any modification or
alteration of the rights of its creditors, or (c) assuming custody of,
or appointing a receiver or other custodian for, all or a substantial
part of its property; or (vii) by its making an assignment for the
benefit of, or entering into a composition with, its creditors, or
appointing or consenting to the appointment of a receiver or other
custodian for all or a substantial part of its property; or
(h) Any judgment, writ, warrant of attachment or execution or
similar process shall be issued or levied against a substantial part of
the property of any Company or any Subsidiary and such judgment, writ,
or similar process shall not be released, vacated or fully bonded within
(60) days after its issue or levy;
then, and in any such event, the Purchaser or any other holder of the
Notes may, by notice to any Company, declare the entire unpaid principal
amount of the Notes, all interest accrued and unpaid thereon and all
other amounts payable under this Agreement to be forthwith due and
payable, whereupon the Notes, all such accrued interest and all such
amounts shall become and be forthwith due and payable (unless there
shall have occurred an Event of Default under subsection 6.01(g) in
which case all such amounts shall automatically become due and payable),
without presentment, demand, protest or further notice of any kind, all
of which are hereby expressly waived by each Company.
6.02. ANNULMENT OF DEFAULTS. Section 6.01 is subject to the
condition that, if at any time after the principal of any of the Notes
shall have become due and payable, and before any judgment or decree for
the payment of the moneys so due, or any portion thereof, shall have
been entered, all arrears of interest upon all the Notes and all other
sums payable under the Notes and under this Agreement (except the
principal of the Notes which by such declaration shall have become
payable) shall have been duly paid, and every other default and Event of
Default shall have been made good or cured, then and in every such case
the holders of seventy-five percent (75%) or more in principal amount of
all Notes then outstanding may, by written instrument filed with any
Company, rescind and annul such declaration and its consequences; but no
such rescission or annulment shall extend to or affect any subsequent
default or Event of Default or impair any right consequent thereon.
ARTICLE VII
DEFINITIONS AND ACCOUNTING TERMS
7.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings (such meanings to be
equally applicable to both the singular and plural forms of the terms
defined):
"Agreement" means this Secured Note and Warrant Purchase Agreement
as from time to time amended and in effect between the parties.
"Capital Resource Company Act" shall have the meaning assigned to
that term in Section 1.11.
"Code" shall have the meaning assigned to that term in Section
4.01(i).
"Commission" means the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"Companies" means and shall include Matec Corporation, Bergen Cable
Technologies, Inc., Matec Applied Sciences, Inc., Matec Instruments,
Inc. and ▇▇▇▇▇▇-▇▇▇▇▇▇ Corporation and their respective successors and
assigns.
"Common Stock" includes Matec's Common Stock, $.05 par value per
share, as authorized on the date of this Agreement, and any other
securities into which or for which any of such Common Stock may be
converted or exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
"Consolidated" and "consolidating" when used with reference to any
term defined herein mean that term as applied to the accounts of the
Companies and their Subsidiaries consolidated in accordance with
generally accepted accounting principles.
"Consolidated Net Earnings Available for Interest Charges" means,
for any period, Consolidated Net Income for such period plus (a)
interest paid or accrued by the Companies and their Subsidiaries with
respect to all Indebtedness for such period and (b) income and excess
profit taxes for such period and all other taxes for such period which
are imposed on or measured by income after deduction of interest
charges.
"Consolidated Net Income" means, for any period, the net income (or
net deficit) of the Companies and their Subsidiaries for such period,
after all expenses, taxes and other proper charges, determined in
accordance with generally accepted accounting principles eliminating (i)
all intercompany items, (ii) all earnings attributable to equity
interests in Persons that are not Subsidiaries unless actually received
by the Companies or their Subsidiaries, (iii) all income arising from
the forgiveness, adjustment or negotiated settlement of any
Indebtedness, and (iv) any increase or decrease of income arising from
any change in the method of accounting for any item from that employed
in the preparation of the financial statements attached hereto as
EXHIBIT 3.08.
"Consolidated Net Worth" means, at any dates, the sum of (a) the
par value of all of the stock of the Companies issued and outstanding,
(b) the amount of any additional paid-in-capital and (c)
(i) the positive retained earnings, if any, of the
Companies and their Subsidiaries, or
(ii) less, the amount of any deficit in the retained
earnings of the Companies and their Subsidiaries
as the same appears on a consolidated balance sheet of the Companies and
their Subsidiaries prepared in accordance with generally accepted
accounting principles consistently applied as of such date, after
eliminating all intercompany items and all amounts properly attributable
to (1) any write-up in the book value of any asset resulting from a
revaluation thereof after the date of this Agreement; (2) the amount of
any intangible assets including patents, trademarks, unamortized debt
discount and expense, goodwill, covenants and agreements and the excess
of the purchase price paid for assets or stock acquired over the value
assigned thereto on the books of such Company or of such Subsidiary
which shall have acquired the same; (3) earnings attributable to any
other Person unless actually received by the Companies or their
Subsidiaries; and (4) changes in the method of accounting.
"Current Liabilities" means all liabilities of any corporation
which would, in accordance with generally accepted accounting principles
consistently applied, be classified as current liabilities of a
corporation conducting a business the same as or similar to that of such
corporation, including, without limitation, all rental payments due
under leases required to be capitalized in accordance with applicable
Statements of Financial Accounting Standards and fixed prepayments of,
and sinking fund payments with respect to, Indebtedness (including
Indebtedness evidenced by the Notes), which payments are required to be
made within one year from the date of determination.
"Distribution" shall have the meaning assigned to that term in
Section 4.02(g).
"ERISA" shall have the meaning assigned to that term in Section
3.10.
"Events of Default" shall have the meaning assigned to that term in
Section 6.01.
"Exchange Act" means the Securities Exchange Act of 1934 or any
similar federal statute, and the rules and regulations of the Commission
(or of any other Federal Agency then administering the Exchange Act)
thereunder, all as the same shall be in effect at the time.
"Form 10-K" means Matec's Form 10-K for the fiscal year ended
December 31, 1994 as filed with the Commission pursuant to the Exchange
Act.
"Government Contract" shall have the meaning assigned to that term
in Section 3.14.
"Indebtedness" means all obligations, contingent and otherwise,
which should, in accordance with generally accepted accounting
principles consistently applied, be classified upon the obligor's
balance sheet as liabilities, but in any event including, without
limitation, liabilities secured by any mortgage on property owned or
acquired subject to such mortgage, whether or not the liability secured
thereby shall have been assumed, and also including, without limitation,
(i) all guaranties, endorsements and other contingent obligations, in
respect of Indebtedness of others, whether or not the same are or should
be so reflected in said balance sheet, except guaranties by endorsement
of negotiable instruments for deposit or collection or similar
transactions in the ordinary course of business and (ii) the present
value of any lease payments due under leases required to be capitalized
in accordance with applicable Statements of Financial Accounting
Standards, determined in accordance with applicable Statements of
Financial Accounting Standards.
"Interest Charges" means the interest expense of the Companies and
their Subsidiaries on Indebtedness (including the current portion
thereof).
"Matec" means Matec Corporation, Delaware corporation, and its
successors and assigns.
"Notes" shall have the meaning assigned to that term in Section
1.01.
"Person" means an individual, corporation, partnership, joint
venture, trust, or unincorporated organization, or a government or any
agency or political subdivision thereof.
"Proxy Statement" means the Proxy Statement, filed by Matec with
the Commission for use in connection with ▇▇▇▇▇'s April 26, 1995 meeting
of stockholders.
"Purchaser" means and shall include not only the Massachusetts
Capital Resource Company but also any other holder or holders of any of
the Notes or Warrants.
"Registrable Shares" means and shall include the shares of Common
Stock issued and issuable upon exercise of the Warrants, excluding,
however, any such shares of Common Stock which have been: (a) registered
under the Securities Act pursuant to an effective registration statement
filed thereunder and disposed of in accordance with the registration
statement covering them or (b) publicly sold pursuant to Rule 144 under
the Securities Act.
"Securities Act" means the Securities Act of 1933 or any similar
Federal statute, and the rules and regulations of the Commission (or of
any other Federal agency then administering the Securities Act)
thereunder, all as the same shall be in effect at the time.
"Security Agreements" shall have the meaning assigned to that term
in Section 2.02(a).
"Subsidiary" or "Subsidiaries" means any corporation or trust of
which any Company and/or any Subsidiaries (as herein defined) directly
or indirectly owns at the time all of the outstanding shares of every
class of such corporation or trust other than directors' qualifying
shares.
"Warrants" shall have the meaning assigned to that term in Section
1.02.
7.02. ACCOUNTING TERMS. All accounting terms not specifically
defined herein shall be construed in accordance with generally accepted
accounting principles consistent with those applied in preparation of
the financial statements attached hereto as EXHIBIT 3.08, and all
financial data submitted pursuant to this Agreement and all financial
tests to be calculated in accordance with this Agreement shall be
prepared and calculated in accordance with such principles.
ARTICLE VIII
MISCELLANEOUS
8.01. NO WAIVER; CUMULATIVE REMEDIES. No failure or delay on the
part of the Purchaser, or any other holder of the Notes or Warrants in
exercising any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such
right, power or remedy preclude any other or further exercise thereof or
the exercise of any other right, power or remedy hereunder. The
remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
8.02. AMENDMENTS, WAIVERS AND CONSENTS. Any provision in this
Agreement, the Notes or the Warrants to the contrary notwithstanding,
changes in or additions to this Agreement may be made, and compliance
with any covenant or provision herein or therein set forth may be
omitted or waived, if the Companies (i) shall, in the case of the Notes,
obtain consent thereto in writing from the holder or holders of at least
seventy-five percent (75%) in principal amount of all Notes then
outstanding, and (ii) shall, in the case of the Warrants, obtain the
consent thereto in writing from the holder or holders of at least
seventy-five percent (75%) of the Common Stock issued and issuable upon
exercise of the Warrants; PROVIDED, HOWEVER, that if any such consent
shall effect solely the provisions of the Notes or solely the provisions
of the Warrants, then, in such event, the foregoing consent need only be
obtained from the holders of the Notes or Warrants, as the case may be,
and further provided that no such consent shall be effective to reduce
or to postpone the date fixed for the payment of the principal
(including any required redemption) or interest payable on any Note,
without the consent of the holder thereof, or to reduce the percentage
of the Notes and Warrants the consent of the holders of which is
required under this Section. Any waiver or consent may be given subject
to satisfaction of conditions stated therein and any waiver or consent
shall be effective only in the specific instance and for the specific
purpose for which given. Written notice of any waiver or consent
effected under this subsection shall promptly be delivered by the
Companies to any holders who did not execute the same.
8.03. ADDRESSES FOR NOTICES, ETC. All notices, requests, demands
and other communications provided for hereunder shall be in writing
(including telegraphic communication) and mailed or sent by facsimile or
delivered to the applicable party at the addresses indicated below:
If to the Companies:
Matec Corporation
Matec Applied Sciences, Inc.
Matec Instruments, Inc.
▇▇▇▇▇▇-▇▇▇▇▇▇ Corporation
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Bergen Cable Technologies, Inc.
▇▇▇▇▇ Street
Lodi, New Jersey 07644
Attention: President
If to the Purchaser:
Payments should be mailed to:
Massachusetts Capital Resource Company
P. O. Box 3707
Boston, Massachusetts 02241
and all other deliveries and other communications made at or sent
to:
Massachusetts Capital Resource Company
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice President
If to any other holder of the Notes or Warrants: at such holder's
address for notice as set forth in the register maintained by Matec, or,
as to each of the foregoing, at such other address as shall be
designated by such Person in a written notice to the other party
complying as to delivery with the terms of this Section. All such
notices, requests, demands and other communications shall, when mailed
or sent by facsimile, respectively, be effective when deposited in the
mails or sent by such facsimile, respectively, addressed as aforesaid.
8.04. COSTS, EXPENSES and TAXES. The Companies, jointly and
severally, agree to pay on demand all costs and expenses of the
Purchaser in connection with the preparation, execution and delivery of
this Agreement, the Notes, the Warrants, the Security Agreements and
other instruments and documents to be delivered hereunder, including the
reasonable fees and out-of-pocket expenses of Messrs. ▇▇▇▇▇, ▇▇▇▇▇▇▇ &
▇▇▇▇▇▇▇▇▇, special counsel for the Purchaser, with respect thereto, as
well as the reasonable fees and out-of-pocket expenses of legal counsel,
independent public accountants and other outside experts reasonably
retained by the Purchaser in connection with the amendment or
enforcement of this Agreement, the Notes, the Warrants, the Security
Agreements and other instruments and documents to be delivered hereunder
or thereunder. In addition, the Companies, jointly and severally, shall
pay any and all stamp and other taxes payable or determined to be
payable in connection with the execution and delivery of this Agreement,
the Notes, the Warrants, the Security Agreements and the other
instruments and documents to be delivered hereunder or thereunder and
agrees to save the Purchaser harmless from and against any and all
liabilities with respect to or resulting from any delay in paying or
omission to pay such taxes and filing fees.
8.05. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding
upon and inure to the benefit of each Company and the Purchaser and
their respective successors and assigns, except that no Company shall
have the right to assign its rights hereunder or any interest herein
without the prior written consent of the Purchaser.
8.06. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All
representations and warranties made in this Agreement, the Notes, the
Warrants, the Security Agreements or any other instrument or document
delivered in connection herewith or therewith, shall survive the
execution and delivery hereof or thereof and the making of the loans.
8.07. PRIOR AGREEMENTS. This Agreement constitutes the entire
agreement between the parties and supersedes any prior understandings or
agreements concerning the subject matter hereof.
8.08. SEVERABILITY. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability
of any other provision.
8.09. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the Commonwealth of
Massachusetts.
8.10. HEADINGS. Article, Section and subsection headings in this
Agreement are included herein for convenience of reference only and
shall not constitute a part of this Agreement for any other purpose.
8.11. SEALED INSTRUMENTS. This Agreement is executed as an
instrument under seal.
8.12. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, all of which taken together shall constitute one and
the same instrument, and each of the parties hereto may execute this
Agreement by signing any such counterpart.
8.13. FURTHER ASSURANCES. From and after the date of this
Agreement, upon the request of the Purchaser, each Company and each
Subsidiary shall execute and deliver such instruments, documents and
other writings as may be necessary or desirable to confirm and carry out
and to effectuate fully the intent and purposes of this Agreement, the
Notes, the Warrants and the Security Agreements.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
MATEC CORPORATION
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
BERGEN CABLE TECHNOLOGIES, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Executive
Officer
MATEC APPLIED SCIENCES, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Executive
Officer
MATEC INSTRUMENTS, INC.
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
▇▇▇▇▇▇-▇▇▇▇▇▇ CORPORATION
By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇, President
MASSACHUSETTS CAPITAL RESOURCE COMPANY
By /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Senior Vice
President
The exhibits to the Secured Note and Warrant Purchase Agreement are not
included herewith. Registrant hereby undertakes and agrees to furnish a
copy of each such exhibit to the Securities and Exchange Commission upon
request.