EXHIBIT 10.33
ACQUISITION LINE OF CREDIT NOTE
$30,000,000.00 November 8, 2006
Springfield, Massachusetts
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇ & Wesson Corp., a Delaware
corporation having a principal place of business at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ (the "Borrower"), promises to pay to the order, of TD
BankNorth, N.A., a national banking association ("Lender"), having a usual place
of business at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇, the principal sum
of Thirty Million and 00/100 Dollars ($30,000,000.00) or the (then) current
balance of ▇▇▇▇▇▇▇▇'s outstanding Acquisition Loans made on or after the date
hereof, as reflected on the books, records and ledgers of the Lender, as well as
all other obligations of the Borrower which may at any time be due the Lender
(if such balances or obligations are other than Thirty Million and 00/100
Dollars ($30,000,000.00), together with interest thereon at the rates
hereinafter provided which shall be due and payable upon the outstanding
principal balance until paid in full, in accordance with a certain Amended and
Restated Loan and Security Agreement of even date herewith among the Borrower,
▇▇▇▇▇ & Wesson Holding Corporation and the Lender (as successor-by-merger to
Banknorth, N.A.) (the "Loan Agreement"). Unless otherwise defined herein,
capitalized terms shall have the meanings ascribed to them in the Loan
Agreement.
Interest shall be payable in arrears, and shall be calculated daily and
payable in accordance with the terms of the Loan Agreement on the outstanding
and unpaid principal amount of Acquisition Loans during the preceding month at a
rate per annum equal to:
A. For a Prime Loan, at a rate equal to the Prime Rate in effect from time
to time, plus the Applicable Margin then in effect with respect to Prime Loans.
B. For a LIBOR Loan at a rate equal to the LIBOR Base Rate in effect from
time to time, plus the Applicable Margin then in effect with respect to LIBOR
Loans.
Prior to the Conversion Date, principal sums advanced under this Note may
be repaid and reborrowed in accordance with the terms of the Loan Agreement. No
Borrowing or Loan under this Note shall be made after the Conversion Date.
Subject to the terms and conditions contained in the Loan Agreement, this
Acquisition Line of Credit Note shall be repaid in accordance with the terms of
the Loan Agreement. This Note is the Acquisition Note referred to in, and is
subject to, and entitled to, the benefits of the Loan Agreement between Borrower
and Lender. The terms used herein which are defined in the Loan Agreement shall
have their defined meanings when used herein.
Principal amounts advanced under this Note (the "Acquisition
Loan") shall convert to a principal amortizing loan on November 8,
2008 (the "Conversion Date").
Commencing one (1) month after the Conversion Date and on the
same day of each succeeding month, the Borrower will repay the (then)
outstanding principal balance of the Acquisition Loans, together with
interest thereon, in sixty (60) consecutive monthly installments, each
of which shall be in an amount consisting of: (x) principal in an
amount equal to one sixtieth (1/60) of the outstanding balance of the
Acquisition Loan on the Conversion Date, and (y) accrued interest then
on the unpaid principal balance of the Acquisition Loans at the
rate(s) then in effect. The entire unpaid principal balance of the
Acquisition Loan, together with accrued interest thereon shall be due
and payable on the Acquisition Loan Maturity Date.
All Acquisition Loans shall be secured by a Lender's security interest
granted in the Loan Agreement.
Any payment received more than ten (10) days after its due date shall be
subject to an additional charge of six percent (6%) of the amount due.
This Note and all Acquisition Loans made hereunder shall be in default, and
all unpaid principal, interest, and other amounts due, shall, at Lender's
option, be immediately due and payable, without prior notice, protest, or
demand, upon the occurrence of any one or more of the Events of Default as
specified in the Loan Agreement. Default upon this Note shall also operate as a
default upon all other Obligations of Borrower to Lender.
Upon and during the continuance of an Event of Default (whether or not
Lender has accelerated payment of the Acquisition Loan or any other Obligations
hereunder), or after maturity or after judgment has been rendered on the
Acquisition Loan or any other Obligations hereunder, ▇▇▇▇▇▇▇▇'s right to select
pricing options shall cease and the unpaid principal of all Borrowings and Loans
shall, at the option of Lender, bear interest at the default rate set forth in
Section 2.14(c) of the Loan Agreement.
Nothing herein shall be construed to restrict the Lender, in its sole
discretion, from making Borrowings and Loans in excess of the face amount of
this Note, without requirement of execution of additional notes, or otherwise
modifying this instrument, and its so doing at any time or times, shall not
result in a waiver of its rights to insist upon strict compliance with the terms
of this Note, or any document or instrument granting security to the Lender or
other instruments executed in connection with this financial transaction, at any
other time.
▇▇▇▇▇▇▇▇ agrees that the Lender shall make Borrowings or Loans to the
Borrower upon written or verbal authority of ▇▇▇▇▇▇▇▇ and deliver loan proceeds
by direct deposit to any demand deposit account of the Borrower with the Lender,
or otherwise, as so directed; and that all such Borrowings and Loans as
evidenced solely by the Lender's books, ledgers and records shall represent
binding obligations of the Borrower hereunder.
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Borrower, with respect to this Note and/or the obligation represented by
this Note, waives presentment, demand, notice, protest and all other demands or
notices in connection with the delivery, acceptance, or endorsement of this
Note. With respect to liabilities, the Borrower assents to any extension or
postponement of the time of payment or any other indulgence to the addition or
release of any party or person primarily or secondarily liable, to the
acceptance of partial payments thereon and the settlement thereof, all in such
manner and at such time or times as the Lender may elect in its sole and
exclusive discretion, and generally waives all suretyship defenses and defenses
in the nature thereof. No delay or omission on the part of the Lender in
exercising any right shall operate as a waiver of such right or any other right.
A waiver on any one occasion shall not be construed as a bar to or waiver of any
right on any future occasion. All rights and remedies of the Lender, whether
evidenced hereby or by any other instrument or papers, shall be cumulative and
may be exercised singularly or concurrently.
The undersigned will pay all reasonable costs and expenses of collection,
after an Event of Default, including reasonable attorneys' fees, incurred or
paid by the holder in enforcing this Note or the obligations hereby evidenced,
to the extent permitted by law.
No delay or omission of the holder in exercising any right or remedy
hereunder shall constitute a waiver of any such right or remedy. Acceptance by
the holder of any payment after acceleration shall not be deemed a waiver of
such acceleration. A waiver on one occasion shall not operate as a bar to or
waiver of any such right or remedy on any future occasion.
The holder need not enter payments of principal or interest upon this Note
but may maintain a record thereof on a separate ledger maintained by the holder.
The word "holder" as used in this Note shall mean the payee or endorsee of
this Note who is in possession of it or the bearer if this Note is at the time
payable to bearer. The word "Borrower" as used in this Note shall mean the
Borrower and all successors or assigns.
In the event any payment of principal or interest received upon this
obligation and paid by the Borrower, or any guarantor, surety, co-maker or
endorser, shall be deemed by final order of a court of competent jurisdiction to
have been a voidable preference or fraudulent conveyance under the bankruptcy or
insolvency laws of the United States, or any state, or otherwise due to any
party other than the Lender, then in any such event, the obligation of said
Borrower, or any guarantor, surety, co-maker or endorser shall, jointly and
severally, survive as an obligation due hereunder and shall not be discharged or
satisfied by said payment or payments, notwithstanding return by the Lender to
said parties of the original hereof, or any guaranty, endorsement, or the like.
The Borrower expressly warrants that the proceeds of the loan shall be used
solely for business purposes and that this transaction is not a consumer
transaction subject to M.G.L.c. 140D, Regulation Z of the Board of Governors of
the Federal Reserve System, or other "consumer protection" statutes,
regulations, or restrictions, without exception. Borrower is not engaged in the
business of purchasing or selling margin stock (as defined in Regulation U of
the Board of Governors of the Federal Reserve System) or extending credit to
others for the purpose of purchasing or carrying margin stock, and no part of
the proceeds of any borrowing hereunder
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will be used to purchase or carry any margin stock or for any other purpose
which would violate any of the margin regulations of said Board of Governors.
Borrower hereby grants to Lender, a continuing lien, security interest and
right of setoff as security for all liabilities and obligations to Lender,
whether now existing or hereafter arising, upon and against all deposits,
credits, collateral and property, now or hereafter in the possession, custody,
safekeeping or control of Lender or any entity under the control of TD
BankNorth, N.A. and its successors and assigns or in transit to any of them. At
any time, without demand or notice (any such notice being expressly waived by
Borrower), Lender may setoff the same or any part thereof and apply the same to
any liability or obligation of Borrower even though unmatured and regardless of
the adequacy of any other collateral securing the Loan. ANY AND ALL RIGHTS TO
REQUIRE LENDER TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER
COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH
RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF BORROWER, ARE HEREBY
KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
Lender shall have the unrestricted right at any time and from time to time,
and without the consent of or notice to Borrower, to grant to one or more banks
or other financial institutions (each, a "Participant") participating interests
in ▇▇▇▇▇▇'s obligation to lend hereunder and/or any or all of the loans held by
▇▇▇▇▇▇ hereunder. In the event of any such grant by ▇▇▇▇▇▇ of a participating
interest to a Participant, whether or not upon Notice to Borrower, ▇▇▇▇▇▇ shall
remain responsible for the performance of its obligations hereunder and ▇▇▇▇▇▇▇▇
shall continue to deal solely and directly with Lender in connection with
▇▇▇▇▇▇'s rights and obligations hereunder. Bank may furnish any information
concerning Borrower in its possession from time to time to prospective
Participants, provided that Lender shall require any such prospective
Participant to agree in writing to maintain the confidentiality of such
information.
This Note and the rights and obligations of the parties hereunder shall be
construed and interpreted in accordance with the laws of the Commonwealth of
Massachusetts (the "Governing State") (excluding the laws applicable to
conflicts or choice of law).
Upon receipt of an affidavit of an officer of ▇▇▇▇▇▇ as to the loss, theft,
destruction or mutilation of the Note or any other security document which is
not of public record, and, in the case of any such loss, theft, destruction or
mutilation, upon cancellation of such Note or other security document, Borrower
will issue, in lieu thereof, a replacement note or other security document in
the same principal amount thereof and otherwise of like tenor.
This Note shall be governed by the laws of the Commonwealth of
Massachusetts provided that, as to the maximum rate of interest which may be
charged or collected, if the laws applicable to the Lender permit it to charge
or collect a higher rate than the laws of The Commonwealth of Massachusetts,
then such laws applicable to the Lender shall apply to the Lender under this
Note.
THE BORROWER AND THE ▇▇▇▇▇▇ ▇▇▇▇▇▇ WAIVE TRIAL BY JURY IN ANY ACTION,
PROCEEDING, CLAIM OR COUNTERCLAIM, WHETHER IN CONTRACT OR
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TORT, AT LAW OR IN EQUITY, ARISING OUT OF OR IN ANY WAY RELATES TO THIS NOTE OR
ANY OTHER LOAN DOCUMENT. NO OFFICER OF THE LENDER HAS AUTHORITY TO WAIVE,
CONDITION, OR MODIFY THIS PROVISION.
(The next page is the signature page.)
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This Note shall take effect as an instrument under seal.
▇▇▇▇▇ & WESSON CORP.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
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Witness ▇▇▇▇ ▇. ▇▇▇▇▇
Vice President and
Chief Financial Officer