EXHIBIT 10.25
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LOAN AGREEMENT
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This Loan Agreement (the "Agreement") dated as of June 10, 2000, by and
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between Bank of America, N.A., a national banking association ("Bank") and the
Borrower described below.
In consideration of the Loan or Loans described below and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, Bank and Borrower agree as follows:
1. DEFINITIONS AND REFERENCE TERMS. In addition to any other terms
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defined herein, the following terms shall have the meaning set forth with
respect thereto:
A Borrower: OPNET Technologies, Inc. a Delaware corporation
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B. Borrower's Address: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.▇.
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▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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C. "Business Day" means a day on which Lender is open for the
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conduct of substantially all of its banking business at its
principal office.
D. EBITDA. For any fiscal period, the consolidated net income or
consolidated net loss of Borrower and its Subsidiaries, as the case may be, for
such fiscal period, after excluding therefrom (a) amounts deducted for
extraordinary gain and (b) the amount of capitalized software development costs
during such period and restoring thereto (without duplication) (i) depreciation
and amortization expense determined on a consolidated basis in accordance with
GAAP, for such period (ii) the amount of interest expense of Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP, for
such period on the aggregate principal amount of their consolidated Indebtedness
and any fees (including commitment and administrative fees) with respect to such
Indebtedness and (iii) the amount of tax expense of the Borrower and its
Subsidiaries, determined on a consolidated basis in accordance with GAAP, for
such period.
E. Hazardous Materials. Hazardous Materials include all materials defined
as hazardous materials or substances under any local, state or federal
environmental laws, rules or regulations, and petroleum, petroleum products, oil
and asbestos.
F. Indebtedness. Of Borrower and its Subsidiaries, at any date, without
duplication, (a) all indebtedness of Borrower and its Subsidiaries for borrowed
money, (b) the deferred purchase price of property or services (payable more
than six months after the original purchase date of such property or services),
(c) any other indebtedness of Borrower and its Subsidiaries which is evidenced
by a note, bond debenture or similar instrument, (d) all obligations of Borrower
and its Subsidiaries under capital leases, (e) all obligations of Borrower and
its Subsidiaries in respect of letters of credit and bankers acceptances issued
or created for the account of Borrower or any of its Subsidiaries (including
without limitation all issued and outstanding Letters of Credit) under this
agreement, (f) all liabilities secured by any lien or encumbrance of any kind on
any property owned by Borrower or any of its Subsidiaries even though Borrower
or its Subsidiaries, as applicable, has not assumed or otherwise become liable
for the payment thereof, (g) all obligations of Borrower and its Subsidiary in
respect of any payments related to Deferred Purchase Consideration, (h) all
capital stock which contains redemption features, and (i) all Indebtedness of
the types referred to in clauses (a) through (g) above which is guaranteed
directly or indirectly by Borrower or any of its Subsidiaries. For purposes of
calculating the Indebtedness to TTM EBITDA ratio, Indebtedness shall not include
amounts due under the ___________________ agreement with Cadence dated
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____________and the Series A Preferred Stock outstanding as of December 31,
1999.
G. Loan. Any loan described in Section 2 hereof and any subsequent loan
which states that it is subject to this Loan Agreement.
H. Loan Documents. Loan Documents means this Loan Agreement and any and
all promissory notes executed by Borrower in favor of Bank and all other
documents, instruments, guarantees, certificates and agreements executed and/or
delivered by Borrower, any guarantor or third party in connection with any Loan.
I. Operating Income. For any fiscal period, the consolidated net income
or consolidated net loss, as the case may be, for such fiscal period, after
excluding therefrom amounts deducted for extraordinary gain and restoring
thereto (without duplication) (a) the amount of interest expense of such the
Borrower and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP, for such period on the aggregate principal amount of their
consolidated Indebtedness and any fees (including commitment and administrative
fees) with respect to such Indebtedness of the Borrower and its Subsidiaries and
(b) the amount of tax expense of the Borrower and its Subsidiaries, determined
on a consolidated basis in accordance with GAAP, for such period.
J. Permitted Investments. Means each of (i) direct obligations of the
United States of America, and agencies thereof, (ii) obligations fully
guaranteed by the United States of America; (iii) certificates of deposit issued
by, or bankers' acceptances of, or time deposits with, any bank, trust company
or national banking association incorporated or doing business under the laws of
the United States of America or one of the states thereof having combined
capital and surplus and retained earnings of at least $100,000,000; (iv)
commercial paper of companies having a rating assigned to such commercial paper
by Standard & Poor's Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc. or ▇▇▇▇▇'▇ Investors Service, Inc. (or, if neither such organization shall
rate such commercial paper at any time, by any nationally recognized rating
organization in the United States of America) equal to either of the two highest
ratings assigned by such organization; or (v) bonds or other debt instruments of
any company, if such bonds or other debt instruments, at the time of their
purchase, are rated in either of the two highest rating categories by Standard &
Poor's Rating Services, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or ▇▇▇▇▇'▇
Investors Service, Inc. (or, if neither such organization shall rate such
obligations at such time, by any nationally recognized rating organization in
the United States of America).
K. Subsidiary of Borrower means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body are at the time beneficially
owned, or the management of which is otherwise controlled, directly, or
indirectly through one or more intermediaries, or both, by Borrower.
L. TTM EBITDA. As for any Business Day, EBITDA for the Borrower and its
Subsidiaries on a consolidated basis for the twelve-month period ending on such
Business Day or, if such Business Day is not the last day of a calendar month,
on the last Business Day of the calendar month most recently ended prior to such
Business Day.
M. Accounting Terms. All accounting terms not specifically defined or
specified herein shall have the meanings generally attributed to such terms
under generally accepted accounting principles ("GAAP"), as in effect from time
to time, consistently applied, with respect to the financial statements
referenced in Section 3.H. hereof.
2. LOANS.
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A. Loan. Bank hereby agrees to make (or has made) one or more loans
to Borrower in the aggregate principal face amount of $5,000,000.00. The
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obligation to repay the loans is evidenced by a promissory note or notes dated
May____, 2000 ( the promissory note or notes together with any and all renewals,
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extensions or rearrangements thereof being hereafter collectively referred to as
the "Note") having a maturity date, repayment terms and interest rate as set
forth in the Note. Bank will renew the original maturity date of the Note by
one year if the following conditions are met on such original maturity date:
. Borrower has raised at least $25,000,000.00 of net proceeds in an
initial public offering;
. the offering price per share in such initial public offering is greater
than or equal to the price necessary to trigger the automatic conversion
of the Series A Preferred Stock of Borrower into Common Stock of the
Borrower; and
. No default or event of default shall have occurred under this Agreement
or the other Loan Documents.
i. Revolving Credit Feature. The Loan provides for a revolving
line of credit (the "Line") under which Borrower may from time to time, borrow,
repay and re-borrow funds.
ii. Usage Fee. Borrower will pay hereafter on June 30, 2000 and
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on the last day of each quarter for the period from and including the date the
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Line was established to and including the maturity date of the Line, a usage fee
at a rate per annum of 25 basis points of the average daily unused portion of
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the Line during such period. The Borrower may at any time upon written notice to
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the Bank permanently reduce the amount of the Line at which time the obligation
of the Borrower to pay a usage fee shall thereupon correspondingly be reduced.
For the purposes of this section, the unused portion shall be the portion of the
Line after any issuance of letters of credit, as well as cash borrowings.
iii. Letter of Credit Subfeature. As a subfeature under the
Line, Bank may from time to time up to and including May , 2001,
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issue letters of credit for the account of Borrower (each, a "Letter of Credit"
and collectively, "Letters of Credit"); provided, however, that the form and
substance of each Letter of Credit shall be subject to approval by Bank in its
sole discretion; and provided further that the aggregate undrawn amount of all
outstanding Letters of Credit shall not at any time exceed $5,000,000.00. Each
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Letter of Credit shall be issued for a term not to exceed 365 days, as
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designated by Borrower, provided, however, that no Letter of Credit shall have
an expiration date subsequent to May , 2001. The undrawn amount of all
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Letters of Credit plus any and all amounts paid by Bank in connection with
drawings under any Letter of Credit for which the Bank has not been reimbursed
shall be reserved under the Line and shall not be available for advances
thereunder. Each draft paid by Bank under a Letter of Credit shall be deemed an
advance under the Line and shall be repaid in accordance with the terms of the
Line; provided however, that if the Line is not available for any reason
whatsoever, at the time any draft is paid by Bank, or if advances are not
available under the Line in such amount due to any limitation of borrowing set
forth herein, then the full amount of such drafts shall be immediately due and
payable, together with interest thereon, from the date such amount is paid by
Bank to the date such amount is fully repaid by Borrower, at that rate of
interest applicable to advances under the Line. In such event, Borrower agrees
that Bank, at Bank's sole discretion may debit Borrower's deposit account with
Bank for the amount of such draft.
iv. Letter of Credit Fees. Letters of credit shall be assessed a
fee of 1.25% per annum, due upon issuance or a minimum fee of $500.00. All
amendment fees and transfer fees shall be due and payable by the Borrower.
3. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
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warrants to Bank as follows:
A. Good Standing. Borrower is a corporation duly organized, validly
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existing and in good standing under the laws of Delaware and has the power and
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authority to own its property and to carry on its business in each jurisdiction
in which Borrower does business.
B. Authority and Compliance. Borrower has full power and authority to
execute and deliver the Loan Documents and to incur and perform the obligations
provided for therein, all of which have been duly authorized by all proper and
necessary action of the appropriate governing body of Borrower. No consent or
approval of any public authority or other third party is required as a condition
to the validity of any Loan Document, and Borrower is in compliance with all
laws and regulatory requirements to which it is subject.
C. Binding Agreement. This Agreement and the other Loan Documents
executed by Borrower constitute valid and legally binding obligations of
Borrower, enforceable in accordance with their terms.
D. Litigation. There is no proceeding involving Borrower pending or,
to the knowledge of Borrower, threatened before any court or governmental
authority, agency or arbitration authority, except as disclosed to Bank in
writing and acknowledged by Bank prior to the date of this Agreement.
E. No Conflicting Agreements. There is no charter, bylaw, stock
provision, partnership agreement or other document pertaining to the
organization, power or authority of Borrower and no provision of any existing
agreement, mortgage, indenture or contract binding on Borrower or affecting its
property, which would conflict with or in any way prevent the execution,
delivery or carrying out of the terms of this Agreement and the other Loan
Documents.
F. Ownership of Assets. Borrower has good title to its assets, and
its assets are free and clear of liens, except those granted to Bank or as
permitted under section 5B of this Agreement, and as disclosed to Bank in
writing prior to the date of this Agreement.
G. Taxes. All taxes and assessments due and payable by Borrower have
been paid or are being contested in good faith by appropriate proceedings and
the Borrower has filed all tax returns which it is required to file.
H. Financial Statements. The financial statements of Borrower
heretofore delivered to Bank have been prepared in accordance with GAAP applied
on a consistent basis throughout the period involved and fairly present
Borrower's financial condition as of the date or dates thereof, and there has
been no material adverse change in Borrower's financial condition or operations
since March 31, 2000. All information furnished by Borrower to Bank in
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connection with this Agreement and the other Loan Documents is and will be
accurate and complete on the date as of which such information is delivered to
Bank and is not and will not be incomplete by the omission of any material fact
necessary to make such information not misleading.
I. Place of Business. Borrower's chief executive office is located
at
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇.▇.
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▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
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J. Environmental The conduct of Borrower's business operations and
the condition of Borrower's property does not and will not violate any federal
laws, rules or ordinances for environmental protection, regulations of the
Environmental Protection Agency, any applicable local or state law, rule,
regulation or rule of common law or any judicial interpretation thereof relating
primarily to the environment or Hazardous Materials.
K. Continuation of Representations and Warranties. All
representations and warranties made under this Agreement shall be deemed to be
made at and as of the date hereof and at and as of the date of any advance under
any Loan .
L. Subsidiaries. The Borrower has no Subsidiaries other than MIL 3
International Limited. MIL 3 International Limited has no material assets or
operations.
4. AFFIRMATIVE COVENANTS. Until full payment and performance of all
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obligations of Borrower under the Loan Documents, Borrower will, unless Bank
consents otherwise in writing (and without limiting any requirement of any other
Loan Document):
A. Financial Condition. Maintain Borrower's financial condition as
follows, determined in accordance with GAAP applied on a consistent basis
throughout the period involved except to the extent modified by the following
definitions:
i. Maintain a ratio of Indebtedness to TTM EBITDA of not more
than:
2.5 to 1.0 for each calendar quarter
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ii. Maintain at all times unencumbered cash and cash
equivalents in an account with the Bank of not less than:
$5,000,000.00
iii. Maintain Operating Income of not less than:
$1.00 for each calendar quarter.
B. Financial Statements and Other Information. Maintain a system of
accounting in accordance with GAAP applied on a consistent basis throughout the
period involved, permit Bank's officers or authorized representatives to visit
and inspect Borrower's books of account and other records at such reasonable
times and as often as Bank may reasonably desire, and pay the reasonable fees
and disbursements of any accountants or other agents of Bank selected by Bank
for the foregoing purposes. Unless written notice of another location is given
to Bank, Borrower's books and records will be located at Borrower's chief
executive office set forth above. All financial statements called for below
shall be prepared in form and content acceptable to Bank and by independent
certified public accountants acceptable to Bank.
In addition, Borrower will:
i. Furnish to Bank internally prepared consolidated and consolidating (if
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applicable) financial statements (including a balance sheet, statement of cash
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flow and income statement) of Borrower for each quarter of each fiscal year of
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Borrower, within 45 days after the close of each such period, together with a
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statement of cash flows.
ii. Furnish to Bank annually, within 120 days following the end of the
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Borrower's fiscal year, a consolidated balance sheet and income statement
prepared in accordance with generally accepted accounting principles and audited
by an independent public accountant acceptable to the Bank including statements
of financial condition, income, cash flows and changes in shareholders equity.
iii. Furnish to Bank a compliance certificate for (and executed by an
authorized representative of) Borrower concurrently with and dated as of the
date of delivery of each of the financial statements as required in paragraphs i
and ii above, containing (a) a certification that to the best of the knowledge
of the executive officer and certified the financial statements of even date are
true and correct and that the Borrower is not in default under the terms of this
Agreement, and (b) computations and conclusions, in such detail as Bank may
reasonably request, with respect to compliance with this Agreement, and the
other Loan Documents, including computations of all quantitative covenants.
iv. Furnish to Bank quarterly together with each financial statement a
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detailed accounts receivable aging as of the close of each such period.
C. Insurance. Maintain insurance with responsible insurance companies
on such of its properties, in such amounts and against such risks as is
customarily maintained by similar businesses operating in the same vicinity,
specifically to include fire and extended coverage insurance covering all
assets, business interruption insurance, workers compensation insurance and
liability insurance, all to be with such companies and in such amounts as are
satisfactory to Bank and providing for at least 30 days prior notice to Bank of
any cancellation thereof. Satisfactory evidence of such insurance will be
supplied at Bank's request.
D. Existence and Compliance. Maintain its existence, good standing
and qualification to do business, where required and comply with all laws,
regulations and governmental requirements including, without limitation,
environmental laws applicable t6 it or to any of its property, business
operations and transactions.
E. Adverse Conditions or Events. Promptly advise Bank in writing of
(i) any condition, event or act which comes to its attention that would or might
materially adversely affect Borrower's financial condition or operations or
Bank's rights under the Loan Documents, (ii) any litigation filed by or against
Borrower in excess of an aggregate of $100,000.00, (iii) any event that has
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occurred that would constitute an event of default under any Loan Documents and
(iv) any uninsured or partially uninsured loss through fire, theft, liability or
property damage in excess of an aggregate of $100,000.00.
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F. Taxes and Other Obligations. Pay all of its taxes, assessments
and other obligations, including, but not limited to taxes, costs or other
expenses arising out of this transaction, as the same become due and payable,
except to the extent the same are being contested in good faith by appropriate
proceedings in a diligent manner.
G. Maintenance. Maintain all of its tangible property in good
condition and repair and make all necessary replacements thereof, and preserve
and maintain all licenses, trademarks, privileges, permits, franchises,
certificates and the like necessary for the operation of its business.
H. Environmental. Immediately advise Bank in writing of (i) any and
all enforcement, cleanup, remedial, removal, or other governmental or regulatory
actions instituted, completed or threatened pursuant to any applicable federal,
state, or local laws, ordinances or regulations relating to any Hazardous
Materials affecting Borrower's business operations; and (ii) all claims made or
threatened by any third party against Borrower relating to damages,
contribution, cost recovery, compensation, loss or injury resulting from any
Hazardous Materials. Borrower shall immediately notify Bank of any environmental
remedial action taken by Borrower with respect to Borrower's business
operations. Borrower will not use or permit any other party to use any Hazardous
Materials at any of Borrower's places of business or at any other property owned
by Borrower except such materials as are incidental to Borrower's normal course
of business, maintenance and repairs and which are handled in compliance with
all applicable environmental laws. Borrower agrees to permit Bank, its agents '
contractors and employees to enter and inspect any of Borrower's places of
business or any other property of Borrower at any reasonable times upon three
(3) days prior notice for the purposes of conducting an environmental
investigation and audit (including taking physical samples) to insure that
Borrower is complying with this covenant and in the event of default, Borrower
shall reimburse Bank on demand for the costs of any such environmental
investigation and audit. Borrower shall provide Bank, its agents, contractors,
employees and representatives with access to and copies of any and all data and
documents relating to or dealing with any Hazardous Materials used, generated,
manufactured, stored or disposed of by Borrower's business operations within
five (5) days of the request therefore.
5. NEGATIVE COVENANTS. Until full payment and performance of all
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obligations of Borrower under the Loan Documents, Borrower will not, without the
prior written consent of Bank (and without limiting any requirement of any other
Loan Documents):
A. Transfer of Assets or Control. Sell, lease, assign or otherwise
dispose of or transfer any assets, except in the normal course of its business,
or enter into any merger or consolidation, or transfer control or ownership of
the Borrower or form or acquire any subsidiary. A public offering of the
Borrower's common stock shall be permitted.
B. Liens. Grant, suffer or permit any contractual or noncontractual
lien on or security interest in its assets, except in favor of Bank and except
purchase money security interests not in excess of $500,000.00 in the aggregate,
or fail to promptly pay when due all lawful claims, whether for labor, materials
or otherwise.
C. Extensions of Credit. Make or permit any subsidiary to make, any
loan or advance to any person or entity, or purchase or otherwise acquire, or
permit any subsidiary to purchase or other wise acquire, any capital stock,
assets, obligations, or other securities of, make any capital contribution to,
or otherwise invest in or acquire any interest in any entity, or participate as
a partner or joint venturer with any person or entity, except for the purchase
of Permitted Investments and existing employee loans of not more than
$231,000.00 and new loans to officers and employees not in excess of $250,000.00
D. Borrowings. Create, incur, assume or become liable in any manner
for any indebtedness (for borrowed money, deferred payment for the purchase of
assets, lease payments, as surety or guarantor for the debt for another, or
otherwise) other than to Bank, except for normal trade debts incurred in the
ordinary course of Borrower's business, and except for existing indebtedness
disclosed to Bank in writing and acknowledged by Bank prior to the date of this
Agreement, with the exception of new purchase money indebtedness not in excess
of $500,000.00 in the aggregate.
E. Dividends and Distributions. Make any distribution (other than
dividends payable in capital stock of Borrower) on any shares of any class of
its capital stock or, if Borrower is a partnership, make any distribution to any
partner, or apply any of its property or assets to the purchase, redemption or
other retirement of any shares of any class of capital stock of or any
partnership interest in Borrower, other than as contemplated in the Borrowers
Form S-1 registration statement as filed with the Securities and Exchange
commission on March 15, 2000.
F. Character of Business. Change the general character of business as
conducted at the date hereof, or engage in any type of business not reasonably
related to its business as presently conducted.
G. Management Change. Make any substantial change in its present
executive or management personnel, that results in a change of control other
than as contemplated in the Borrower's Form S- I registration statement as filed
with the Securities and Exchange Commission on March 15, 2000.
6. DEFAULT. Borrower shall be in default under this Agreement and under
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each of the other Loan Documents if it shall default in the payment of any
amounts due and owing under the Loan and such default is not cured within five
(5) business days or should it fail to timely and properly observe, keep or
perform any term, covenant, agreement or condition in any Loan Document if
failure is not cured within thirty (30) days after written notice from Bank or
in any other loan agreement, promissory note, security agreement, deed of trust,
deed to secure debt, mortgage, assignment or other contract securing or
evidencing payment of any indebtedness of Borrower to Bank or any affiliate or
subsidiary of Bank of America Corporation.
7. REMEDIES UPON DEFAULT. If an event of default shall occur, Bank shall
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have all rights, powers and remedies available under each of the Loan Documents
as well as all rights and remedies available at law or in equity.
8. NOTICES. All notices, requests or demands which any party is required
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or may desire to give to any other party under any provision of this Agreement
must be in writing delivered to the other party at the following address:
Borrower: OPNET Technologies, Inc. ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇. ▇.▇.
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Attn: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Chief Financial Officer
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Fax. No.
Bank: Bank of America, N.A.
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Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
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or to such other address as any party may designate by written notice to the
other party. Each such notice, request and demand shall be deemed given or made
as follows:
A. If sent by mail, upon the earlier of the date of receipt or five
(5) days after deposit in the U.S. Mail, first class postage prepaid;
B. If sent by any other means, upon delivery.
9. COSTS, EXPENSES AND ATTORNEYS' FEES. Borrower shall pay to Bank
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immediately upon demand the fall amount of all costs and expenses, including
reasonable attorneys' fees (to include outside counsel fees and all allocated
costs of Bank's in-house counsel if permitted by applicable law), incurred by
Bank in connection with (a) negotiation and preparation of this Agreement and
each of the Loan Documents, and (b) all other costs and attorneys' fees incurred
by Bank for which Borrower is expressly obligated to reimburse Bank in
accordance with the terms of the Loan Documents.
10. MISCELLANEOUS. Borrower and Bank further covenant and agree as
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follows, without limiting any requirement of any other Loan Document:
A. Cumulative Rights and No Waiver. Each and every right granted to
Bank under any Loan Document, or allowed it by law or equity shall be cumulative
of each other and may be exercised in addition to any and all other rights of
Bank, and no delay in exercising any right shall operate as a waiver thereof,
nor shall any single or partial exercise by Bank of any right preclude any other
or future exercise thereof or the exercise of any other right. Borrower
expressly waives any presentment, demand, protest or other notice of any kind,
including but not limited to notice of intent to accelerate and notice of
acceleration. No notice to or demand on Borrower in any case shall, of itself,
entitle Borrower to any other or future notice or demand in similar or other
circumstances.
B. Applicable Law. This Loan Agreement and the rights and obligations
of the parties hereunder shall be governed by and interpreted in accordance with
the laws of Maryland and applicable United States federal law.
C. Amendment. No modification, consent, amendment or waiver of any
provision of this Loan Agreement, nor consent to any departure by Borrower
therefrom, shall be effective unless the same shall be in writing and signed by
an officer of Bank, and then shall be effective only in the specified instance
and for the purpose for which given. This Loan Agreement is binding upon
Borrower, its successors and assigns, and inures to the benefit of Bank, its
successors and assigns; however, no assignment or other transfer of Borrower's
rights or obligations hereunder shall be made or be effective without Bank's
prior written consent, nor shall it relieve Borrower of any obligations
hereunder. There is no third party beneficiary of this Loan Agreement.
D. Documents. All documents, certificates and other items required
under this Loan Agreement to be executed and/or delivered to Bank shall be in
form and content satisfactory to Bank and its counsel.
E. Partial Invalidity. The unenforceability or invalidity of any
provision of this Loan Agreement shall not affect the enforceability or validity
of any other provision herein and the invalidity or unenforceability of any
provision of any Loan Document to any person or circumstance shall not affect
the enforceability or validity of such provision as it may apply to other
persons or circumstances.
F. Indemnification. Notwithstanding anything to the contrary
contained in Section 10(G), Borrower shall indemnify, defend and hold Bank and
its successors and assigns harmless from and against any and all claims,
demands, suits, losses, damages, assessments, fines, penalties, costs or other
expenses (including reasonable attorneys' fees and court costs) arising from or
in any way related to any of the transactions contemplated hereby, including but
not limited to actual or threatened damage to the environment, agency costs of
investigation, personal injury or death, or property damage, due to a release or
alleged release of Hazardous Materials, arising from Borrower's business
operations, any other property owned by Borrower or in the surface or ground
water arising from Borrower's business operations, or gaseous emissions arising
from Borrower's business operations or any other condition existing or arising
from Borrower's business operations resulting from the use or existence of
Hazardous Materials, whether such claim proves to be true or false. Borrower
further agrees that its indemnity obligations shall include, but are not limited
to, liability for damages resulting from the personal injury or death of an
employee of the
Borrower, regardless of whether the Borrower has paid the employee under the
workmen's compensation laws of any state or other similar federal or state
legislation for the protection of employees. The term "property damage" as used
in this paragraph includes, but is not limited to, damage to any real or
personal property of the Borrower, the Bank, and of any third parties. The
Borrower's obligations under this paragraph shall survive the repayment of the
Loan and any deed in lieu of foreclosure or foreclosure of any Deed to Secure
Debt, Deed of Trust, Security Agreement or Mortgage securing the Loan.
G. Survivability. All covenants, agreements, representations and
warranties made herein or in the other Loan Documents shall survive the making
of the Loan and shall continue in full force and effect so long as the Loan is
outstanding or the obligation of the Bank to make any advances under the Line
shall not have expired.
11. NO ORAL AGREEMENT. THIS WRITTEN LOAN AGREEMENT AND THE OTHER LOAN
-----------------
DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed under seal by their duly authorized representatives as of the
date first above written.
BORROWER: OPNET Technologies, Inc. BANK: Bank of America, N.A.
-----------------------
BY: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seal) By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (Seal)
--------------------- --------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
----------------- ---------------
Title: SVP & CFO Title: Senior Vice President
--------- ---------------------
By:_____________________________ (Seal)
Name:___________________________
Title:__________________________
[Corporate Seal]
If the Borrower is a corporation, the signature should be attested by the
Secretary or Assistant Secretary of the corporation and the corporate seal
affixed.
Attest:_________________________ (Seal)
Name:___________________________
Title:__________________________
Promissory Note
Date: May , 2000 [X]New [_]Renewal Amount $5,000,000.00 Maturity Date:
------------- -------------
May , 2001
--------------
Bank: Borrower:
Bank of America, N.A.
Banking Center: OPNET Technologies, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
County: ▇▇▇▇▇▇▇▇▇▇ County: N/A
FOR VALUE RECEIVED, the undersigned Borrower unconditionally (and jointly and
severally, if more than one) promises to pay to the order of Bank, its
successors and assigns, without setoff, at its offices indicated at the
beginning of this Note, or at such other place as may be designated by Bank, the
principal amount of Five Million and 00/100 Dollars ($5,000,000.00), or so much
---- ------------------ ---------------
thereof as may be advanced from time to time in immediately available funds,
together with interest computed daily on the outstanding principal balance
hereunder, at an annual interest rate, and in accordance with the payment
schedule, indicated below.
[This Note contains some provisions preceded by boxes. If a box is marked, the
provision applies to this transaction; if it is not marked, the provision does
not apply to this transaction.]
1. Rate.
See Attached Exhibit "A"
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower shall not be required to pay any amount of interest or other charges in
excess of the maximum permitted by the applicable law of the State of Maryland;
if any higher rate ceiling is lawful, then that higher rate ceiling shall apply.
Any payment in excess of such maximum shall be refunded to Borrower or credited
against principal, at the option of Bank.
2. Accrual Method. Unless otherwise indicated, interest at the Rate set forth
above will be calculated by the 365/360 day method (a daily amount of interest
is computed for a hypothetical year of 360 days; that amount is multiplied by
the actual number of days for which any principal is outstanding hereunder). If
interest is not to be computed using this method, the method shall be: N/A.
---
3. Rate Change Date. Any Rate based on a fluctuating index or base rate will
change, unless otherwise provided, each time and as of the date that the index
or base rate changes. If the Rate is to change on any other date or at any
other interval, the change shall be: N/A. In the event any index is
---
discontinued, Bank shall substitute an index determined by Bank to be
comparable, in its sole discretion,
4. Payment Schedule. All payments received hereunder shall be applied first
to the payment of any expense or charges payable hereunder or under any other
loan documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option,
Single Principal Payment. Principal shall be paid in full in a single payment
on May , 2001. Interest thereon shall be paid monthly, commencing on
------- -------
____________ 2000, and continuing on the ____day of each successive month,
quarter or other period (as applicable) thereafter, with a final payment of all
unpaid interest at the stated maturity of this Note.
5. Revolving Feature.
[X] Borrower may borrow, repay and reborrow hereunder at any time, up to a
maximum aggregate amount outstanding at any one time equal to the principal
amount of this Note, provided, that Borrower is not in default under any
provision of this Note, any other documents executed in connection with this
Note, or any other note or other loan documents now or hereafter executed in
connection with any other obligation of Borrower to Bank, and provided that the
borrowings hereunder do not exceed any borrowing base or other limitation on
borrowings by Borrower. Bank shall incur no liability for its refusal to
advance funds based upon its determination that any conditions of such further
advances have not been met. Bank records of the amounts borrowed from time to
time shall be conclusive proof thereof.
[_] Uncommitted Facility. Borrower acknowledges and agrees that, notwithstanding
any provisions of this Note or any other documents executed in connection with
this Note, Bank has no obligation to make any advance, and that all advances are
at the sole discretion of Bank.
[_] Out-Of-Debt Period. For a period of at least ___ consecutive days during [_]
each fiscal year, [_] any consecutive 12-month period, Borrower shall fully pay
down the balance of this Note, so that no amount of principal or interest and no
other obligation under this Note remains outstanding.
6. Automatic Payment.
[X] Borrower has elected to authorize Bank to effect payment of sums due under
this Note by means of debiting Borrower's account number _____________________.
This authorization shall not affect the obligation of Borrower to pay such sums
when due, without notice, if there are insufficient funds in such account to
make such payment in full on the due date thereof, or if Bank fails to debit the
account.
7. Waivers, Consents and Covenants. Borrower, any indorser, or guarantor
hereof or any other party hereto (individually an "Obligor" and collectively
"Obligors") and each of them jointly and severally: (a) waive presentment,
demand, protest, notice of demand, notice of intent to accelerate, notice of
acceleration of maturity, notice of protest, notice of nonpayment, notice of
dishonor, and any other notice required to be given under the law to any Obligor
in connection with the delivery, acceptance, performance, default or enforcement
of this Note, any endorsement or guaranty of this Note, or any other documents
executed in connection with this Note or any other note or other loan documents
now or hereafter executed in connection with any obligation of Borrower to Bank
(the 'Loan Documents'); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any endorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all costs and expenses of collection
or defense of this Note or of any endorsement or guaranty hereof and/or the
enforcement or defense of Bank's rights with respect to, or the administration,
supervision, preservation, protection of, or realization upon, any property
securing payment hereof, including, without limitation, reasonable attorney's
fees, including fees related to any suit, mediation or arbitration proceeding,
out of court payment agreement, trial, appeal, bankruptcy proceedings or other
proceeding, in the amount of 10% of the principal amount of this Note, or such
greater amount as may be determined reasonable by any arbitrator or court,
whichever is applicable.
8. Prepayments. Prepayments may be made in whole or in part at any time on any
loan for which the Rate is based on the Prime Rate or on any other fluctuating
Rate or index which may change daily. All prepayments of principal shall be
applied in the inverse order of maturity, or in such other order as Bank shall
determine in its sole discretion.
9. Delinquency Charge. To the extent permitted by law, a delinquency charge
may be imposed in an amount not to exceed four percent (4%) of any payment that
is more than fifteen days late.
10. Events of Default. The following are events of default hereunder: (a) the
failure to pay or perform any obligation, liability or indebtedness of any
Obligor to Bank, or to any affiliate or subsidiary of Bank of America
Corporation, whether under this Note or any Loan Documents, as and when due
(whether upon demand, at maturity or by acceleration) and not remedied or cured
as permitted in Section 6 under the Loan Agreement dated June 10, 2000; (b) the
-------
failure to pay or perform any other obligation, liability or indebtedness of any
Obligor in excess of $1,000,000.00 to any other party; (c) the death of any
Obligor (if an individual); (d) the resignation or withdrawal of any material
owner/Guarantor of Borrower, as determined by Bank in its sole discretion; (e)
the commencement of a proceeding against any Obligor for dissolution or
liquidation, the voluntary or involuntary termination or dissolution of any
Obligor or the merger or consolidation of any Obligor with or into another
entity; (@ the insolvency of, the business failure of, the appointment of a
custodian, trustee, liquidator or receiver for or for any of the property of,
the assignment for the benefit of creditors by, or the filing of a petition
under bankruptcy, insolvency or debtor's relief law or the filing of a petition
for any adjustment of indebtedness, composition or extension by or against any
Obligor, (g) that any representation or warranty made to Bank by any Obligor in
any Loan Documents or otherwise was, when it was made, untrue or materially
misleading; (h) the failure of any Obligor to timely deliver such financial
statements, including tax returns, other statements of condition or other
information, as Bank shall request from time to time not remedied within five
(5) business days; (i) the entry of a judgment against any Obligor which Bank
deems to be of a material nature, in Bank's sole discretion not paid or
dismissed within thirty (30) days; 0) the seizure or forfeiture of, or the
issuance of any writ of possession, garnishment or attachment, or any turnover
order for any property of any Obligor, (k) the determination by Bank that it is
insecure for any reason; (1) the determination by Bank that a material adverse
change has occurred in the financial condition of any Obligor, or (m) the
failure of Borrowees business to comply with any material law or regulation
controlling its operation.
11. Remedies upon Default. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased at Bank's discretion up to the Prime Rate plus 5% per annum (the
"Default Rate"). The provisions herein for a Default Rate shall not be deemed
to extend the time for any payment hereunder or to constitute a "grace period"
giving Obligors a right to cure any default. At Bank's option, any accrued and
unpaid interest, fees or charges may, for purposes of computing and accruing
interest on a daily basis after the due date of the Note or any installment
thereof, be deemed to be a part of the principal balance, and interest shall
accrue on a daily compounded basis after such date at the Default Rate provided
in this Note until the entire outstanding balance of principal and interest is
paid in full. Bank is hereby authorized at any time to set off and charge
against any deposit accounts of any Obligor, as well as any money, instruments,
securities, documents, chattel paper, credits, claims, demands, income and any
other property, rights and interests of any Obligor which at any time shall come
into the possession or custody or under the control of Bank or any of its
agents, affiliates or correspondents, without notice or demand, any and all
obligations due hereunder. Additionally, Bank shall have all rights and
remedies available under each of the Loan Documents, as well as all rights and
remedies available at law or in equity.
12. Non-waiver. The failure at any time of Bank to exercise any of its options
or any other rights hereunder shall not constitute a waiver thereof, nor shall
it be a bar to the exercise of any of its options or rights at a later date.
All rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligor to Bank
in any other respect at any other time.
13. Applicable Law, Venue and Jurisdiction. This Note and the rights and
obligations of Borrower and Bank shall be governed by and interpreted in
accordance with the law of the State of Maryland. In any litigation in
connection with or to enforce this Note or any endorsement or guaranty of this
Note or any Loan, Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Maryland or the United States located
within the State of Maryland and expressly waive any objections as to venue in
any such courts. Nothing contained herein shall, however, prevent Bank from
bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
14. Partial Invalidity. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
15. Waiver of Jury Trial. Obligors waive trial by jury in any action or
proceeding to which Obligors and Bank may be parties, arising out of, in
connection with or in any way pertaining to, this Note or the Loan Documents.
It is agreed and understood that this waiver constitutes a waiver of trial by
jury of all claims against all parties to such action or proceedings, including
claims against parties who are not parties to this Note. This waiver is
knowingly, willingly and voluntarily made by Obligors.
16. Binding Effect. This Note shall be binding upon and inure to the benefit
of Borrower, Obligors and Bank and their respective successors, assigns, heirs
and personal representatives, provided, however, that no obligations of Borrower
or Obligors hereunder can be assigned without prior written consent of Bank.
17. Controlling Document. To the extent that this Note conflicts with or is in
any way incompatible with any other Loan Document concerning this obligation,
the Note shall control over any other document, and if the Note does not address
an issue, then each other document shall control to the extent that it deals
most specifically with an issue.
18. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF (J.A.M.S.), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY
PARTY TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE COUNTY OF ANY
-------------
BORROWERS DOMICILE AT THE TIME OF THE EXECUTION OF THIS INSTRUMENT, AGREEMENT OR
DOCUMENT AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
---------------------
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT
OR DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES
Borrower represents to Bank that the proceeds of this loan are to be used
primarily for business, commercial or agricultural purposes. Borrower
acknowledges having read and understood, and agrees to be bound by, all terms
and conditions of this Note, and hereby executes this Note intending to create
an instrument executed under seal.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS.
Corporate or Partnership Borrower
OPNET Technologies, Inc.
-----------------------
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seal)
--------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------
Title: SVP & CFO
-----------------------
By: ___________________________(Seal)
Name:__________________________
Title:_________________________
_______________________________________
Attest (If Applicable)
[Corporate Seal]
EXHIBIT A
---------
INTEREST RATE OPTION PROVISIONS
-------------------------------
THIS EXHIBIT A is attached to and forms a part of that certain PROMISSORY
NOTE (the "Note"), dated May 2000, executed by OPNET Technologies, Inc. , a
--- ---- -----------------------
Delaware corporation ("Borrower"), and made payable to the order of Bank of
--------------------
America, N.A. ("Bank").
1. Borrower's Rates. On the terms and subject to the conditions set forth
----------------
below, Borrower will be able to select, from one of the following Rate Options,
an interest rate which will be applicable to a particular dollar increment of
amounts outstanding, or to be disbursed, under the Note: [check the available
options]
[_] The Prime Rate plus - % (the "Prime Rate Option");
[_] The Treasury Securities Rate plus __ % (the "Treasury Securities Rate
Option"); or
[X] The Wall Street Journal Libor Rate, plus the Applicable Margin (the
-----------------
"Wall Street Journal Rate Option");
[_] The Eurodollar Fixed Period Rate, plus _ % (the "Eurodollar Fixed
Period Rate Option");
[_] The CD Rate plus _ % (the "CD Rate Option"); or
[_] The Quoted Rate, plus _ % (the "Quoted Rate Option");
[_] The Transaction Rate of _ % (the "Transaction Rate Option").
Interest based on the Prime Rate Option is a floating rate and will change on
and as of the date of a change in the Prime Rate. The period of time during
which the Prime Rate shall be applicable shall be a Prime Rate Interest Period.
Interest based on the Eurodollar Daily Floating Rate Option is a floating rate
and will change on and as of a change in the Wall Street Journal Libor Rate.
The period of time during which the Wall Street Journal Libor Rate shall be
applicable shall be a Wall Street Journal Libor Interest Period. Interest based
on the Treasury Securities Rate Option will be fixed for periods of N/A year(s)
---
(each a "Treasury Securities Interest Period"). Interest based on the
Eurodollar Fixed Period Rate Option will be fixed for periods of N/A (each a
---
"Eurodollar Fixed Interest Period"). Interest based on the CD Rate Option will
be fixed for periods of N/A (each a "CD Interest Period"). Interest based on
the Quoted Rate Option will be fixed for periods of N/A (each a "Quoted Interest
Period"). Interest based on the Transaction Rate Option will be fixed for
periods of N/A (each a "Transaction Interest Period"). The Treasury Securities
Rate, the Eurodollar Fixed Period Rate, the CD Rate, the Quoted Rate, and the
Transaction Rate each being hereafter from time to time referred to as a "Fixed
Rate Option"). [See note below]
2. Selection of Applicable Interest Rate.
-------------------------------------
(a) Request. Borrower may request (a "Rate Request") that a $ 1.00
------- ----
increment or any amount in excess thereof (an "Increment") of the outstanding
principal of, or amounts to be disbursed under, the Note bear interest at the
Prime Rate Option, the Eurodollar Daily Floating Rate Option, the Treasury
Securities Rate Option, the Eurodollar Fixed Period Rate Option, the CD Rate
Option, the Quoted Rate Option or the Transaction Rate Option, as applicable, by
telephonic notice no later than 1 0-00 a.m. time) a sufficient (in Bank's sole
discretion) number of Business Days prior to the effective date of the Rate
Request to permit Bank to quote the rate requested.
(b) Applicable Interest Rates. Borrower's Rate Request will become
-------------------
effective, and interest on the Increment designated will be calculated at the
rate (the "Effective Rate") requested by Borrower for the applicable Interest
Period, subject to the following:
(i) Notwithstanding any Rate Request, interest shall be calculated on
the basis of the Prime Rate Option if (a) Bank, in good faith, is unable to
ascertain the requested Fixed Rate Option by reason of circumstances
then affecting the applicable money market or otherwise, (b) it becomes unlawful
or impracticable for the Bank to maintain loans based upon the requested Fixed
Rate Option, or (c) Bank, in good faith, determines that it is impracticable to
maintain loans based on the requested Fixed Rate Option because of increased
taxes, regulatory costs, reserve requirements, expenses or any other costs or
charges that affect such Interest Rate Options. Upon the occurrence of any of
the above events, any Increment to which a requested Fixed Rate Option applies,
shall be immediately (or at the option of Bank, at the end of the current Fixed
Rate Interest Period), without further action of Borrower or Bank, converted to
an Increment to which the Prime Rate Option applies.
(ii) Borrower may have no more than a total of ONE Effective Rate(s)
---
applicable to amounts outstanding under the Note at any given time.
(iii) A Rate Request shall be effective as to amounts to be disbursed
under the Note only if, on the effective date of the Rate Requests. such amounts
are in fact disbursed to or for the account of the Borrower in accordance with
the provisions of the Note and any related loan documents.
(iv) Any amounts of outstanding principal for which a Rate Request
has not been made, or is otherwise not effective, shall bear interest until paid
in full at the Prime Rate Option.
(v) Any amounts of outstanding principal bearing interest based upon
a Fixed Rate Option shall bear interest at such rate until the end of the
Interest Period therefor, and thereafter shall bear interest based upon the
Prime Rate Option unless a new Rate Request for a Fixed Rate Option complying
with the terms hereof has been made and has become effective.
(vi) If Borrower shall be in default under the Note ("Default"), then
Bank shall no longer be obligated to honor any Rate Requests.
(vii) No Fixed Rate Interest Period shall extend beyond the maturity
date of the Note.
(c) Repayment. Principal shall be payable on June 10, 2001 and interest
--------- ------- ----
shall be payable as follows: (check all that apply)
[_] For any Interest Period during which the Prime Rate is applicable to any of
the outstanding principal, interest thereon shall be payable - and continuing on
the - day of each successive month, quarter or other period (as applicable)
thereafter, with a final payment of all accrued and unpaid interest on the last
day of such Interest Period.
[X] For any Interest Period during which the Wall Street Journal Libor Rate is
applicable to any of the outstanding principal, interest thereon shall be
payable monthly and continuing on the last day of each successive month,
------- ----
quarter, or other period (as applicable) thereafter, with a final payment of all
accrued and unpaid interest on the last day of such Interest Period.
[_] For any Interest Period during which the Quoted Rate is applicable to any
of the outstanding principal, interest thereon shall be payable - and continuing
on the __ day of each successive month, quarter or other period (as applicable)
thereafter, with a final payment of all accrued and unpaid interest on the last
day of such Interest Period.
[_] For any Interest Period during which the Transaction Rate is applicable to
any of the outstanding principal, interest thereon shall be payable - and
continuing on the _ day of each successive month, quarter or other period (as
applicable) thereafter, with a final payment of all accrued and unpaid interest
on the last day of such Interest Period.
[_] For any Interest Period during which the Eurodollar Fixed Period Rate is
applicable to any of the outstanding principal, all accrued and unpaid interest
thereon shall be payable on the last day of each applicable Interest Period and,
in the case of an Interest Period greater than three months, at three month
intervals after the first day of such Interest Period,
[_] For any Interest Period during which the CD Rate is applicable to any of the
outstanding principal, all accrued and unpaid interest thereon shall be payable
on the last day of each applicable Interest Period and, in the case of an
Interest Period greater than 90 days, at 90 day intervals after the first day of
such Interest Period.
[_] For any Interest Period during which the Treasuries Securities Rate is
applicable to any outstanding principal, interest thereon shall be payable - and
continuing on the _ day of each successive month, quarter or other period (as
applicable) thereafter, with a final payment of all accrued and unpaid interest
on the last day of such Interest Period.
3. Defined Terms. in addition to those terms defined in Section 1 of the
-------------
Note, the following terms as used in this Exhibit A shall have the following
meanings:
"Applicable Margin" means the following amounts per annum, based upon the
-------------------
ratio of Indebtedness to TTM EBITDA as set forth in the most recent compliance
certificate of Borrower received by Bank pursuant to Section 4.B.iii. of that
certain Loan Agreement dated as of June 10 , 2000 between Borrower and Bank,
-------- -----
provided, however, that until Bank receives the first compliance certificate
--------
after the date of this Note such amount shall be those indicated for pricing
level 2 set forth below;
--
Applicable Margin (in basis points per annum)
----------------------------------
Pricing Indebtedness Wall Street
Level To Journal Libor
TTM EBITDA Rate +
1 * 1.50 to 1.0 200 bps
2 ** 1.50 to 1.0 250 bps
* less than
** greater than or equal to
The Applicable Margin shall be in effect from the date the most recent
compliance certificate is received by Bank to but excluding the date the next
compliance certificate is received by Bank; provided, however, that if Borrower
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fails to timely deliver the next compliance certificate, the Applicable Margin
from the date such compliance certificate was due to but excluding the date such
is received by Bank shall be that indicated for the highest pricing level set
forth above, and, thereafter, the pricing level indicated by such compliance
certificate when received.
"Business Day" shall mean a day on which Bank is open for business and
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dealing in deposits in the United States.
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"Treasury Securities Rate" shall mean the rate of interest per annum
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determined by Bank, in accordance with its customary general practice from time
to time, to be the weekly average yield on all United States Treasury Securities
adjusted to a constant maturity for a term comparable to such Interest Period,
as most recently reported by the Federal Reserve System in the weekly Federal
Reserve Statistical Release No. H-15(519), entitled "Selected Interest Rates"
(or any succeeding publication)(the "Treasury Securities Rate") adjusted from
time to time in Bank's sole discretion for then applicable reserve requirements,
deposit insurance assessment rates and other regulatory costs.
"CD Rate" shall mean the rate of interest per annum (rounded upwards, if
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necessary, to the next higher 1/16 of 1%) determined by Bank, in accordance with
its customary general practice from time to time, paid from time to time by
major banks on negotiable certificates of deposit (secondary market) in amounts
of $100,000.00 or more for a term comparable to such Interest Period. as most
recently reported by the Federal Reserve System in the weekly Federal Reserve
Statistical Release No. H-15(519), entitled "Selected Interest Rates" (or any
succeeding publication )(the "CD Rate") adjusted from time to time in Bank's
sole discretion for then applicable reserve requirements, deposit insurance
assessment rates and other regulatory costs.
"Eurodollar Fixed Period Rate" shall mean the rate of interest per annum
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(rounded upwards, if necessary to the nearest 1/100 of 1%) appearing on Telerate
Page 3750 (or any successor page) as the London interbank offered rate for
deposits in Dollars at approximately 1 1:00 a.m. (London time) two Business Days
prior to the first day of such Interest Period for a term comparable to such
Interest Period, as adjusted from time to time in Bank's sole discretion for
then applicable reserve requirements, deposit insurance assessment rates and
other regulatory costs. If for any reason such rate is not available, the term
"Eurodollar Fixed Period Rate" shall mean the rate of interest per annum
(rounded upwards, if necessary to the nearest 1/100 of 1%) appearing on Reuters
Screen LIBO Page as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period for a term comparable to such Interest Period, as
adjusted from time to time in Bank's sole discretion for then applicable reserve
requirements, deposit insurance assessment rates and other regulatory costs-,
Provided, however, if more than one rate is specified on Reuters Screen LIBO
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Page, the applicable rate shall be the arithmetic mean of all such rates.
"Wall Street Journal LIBOR Rate. The Rate shall be The Wall Street Journal
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LIBOR Rate, plus the Applicable Margin. The "Wall Street Journal LIBOR Rate" is
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a fluctuating rate of interest equal to the one month London interbank offered
rate as published in the "Money Rates" section of The Wall Street Journal on the
immediately preceding business day as adjusted from time to time in Bank's sole
discretion for then applicable reserve requirements, deposit insurance
assessment rates and other regulatory costs. Interest will accrue on any non-
business day at the rate in effect on the immediately preceding business day.
"Prime Rate" is the fluctuating rate of interest established by Bank from
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time to time, at its discretion, whether or not such rate shall be otherwise
published. The Prime Rate is established by Bank as an index and may or may not
at any time be the best or lowest rate charged by Bank on any loan.
"Quoted Rate" shall mean a fixed rate of interest per annum agreed upon by
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the Bank and Borrower on or prior to the first day of the Interest Period for
which such rate shall be in effect.
"Transaction Rate" shall mean the fixed rate of _ % per annum.
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4. Notices; Authority to Act. Borrower acknowledges and agrees that the
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agreement of Bank herein to receive certain notices by telephone is solely for
the convenience of Borrower. Bank shall be entitled to rely on the authority of
the person purporting to be a person authorized by Borrower to give such notice,
and Bank shall have no liability to Borrower on account of any action taken by
Bank in reliance upon such telephonic notice. The obligation of Borrower to
repay all sums owing under the Note shall not be affected in any way or to any
extent by any failure by Bank to receive written confirmation of any telephonic
notice or the receipt by Bank of a confirmation which is at variance with the
terms understood by Bank to be contained in the telephonic notice.
IN WITNESS WHEREOF, the parties hereto have executed this Exhibit A to Note
as of the 10th day of June, 2000.
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Borrower: OPNET Technologies, Inc.
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By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seal)
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Sr. Vice President & CFO
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By: ____________________________(Seal)
Name:___________________________
Title:__________________________
Bank: Bank of America, N.A.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
Note: LIBOR and Eurodollar should be quoted in terms of months (i.e. one, two
three or six months) and not days (i.e. 30, 60, 90 or 180 days). There is no
automatic way to accrue interest on Quoted rate or Transaction Rate,
calculations must be done manually.
Security Agreement
Bank/Secured Party: Debtor(s)/Pledgor(s):
Bank of America, N.A. OPNET Technologies, Inc.
Banking Center: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
County: ▇▇▇▇▇▇▇▇▇▇ County: N/A
Debtor/Pledgor is: Corporation
Address is Debtor's Place of Business
Collateral (hereinafter defined) is located at: Debtor's address shown above.
1. Security Interest. For good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, Debtor/Pledgor (hereinafter referred
to as "Debtor") assigns and grants to Bank (also known as "Secured Party"), a
security interest and lien in the Collateral (hereinafter defined) to secure the
payment and the performance of the Obligation (hereinafter defined).
2. Collateral. A security interest is granted in the following collateral
described in this Item 2 (the "Collateral"):
A. Types of Collateral
Accounts: Any and all accounts and other rights of Debtor to the
payment for goods sold or leased or for services rendered whether or not earned
by performance, including, without limitation, contract rights, book debts,
checks, notes, drafts, instruments, chattel paper, acceptances, and any and all
amounts due to Debtor from a factor or other forms of obligations and
receivables, now existing or hereafter arising.
Inventory: Blanket Lien: Any and all of Debtor's goods held as
inventory, whether now owned or hereafter acquired, including without
limitation, any and all such goods held for sale or lease or being processed for
sale or lease in Debtor's business, as now or hereafter conducted, including all
materials, goods and work in process, finished goods and other tangible property
held for sale or lease or furnished or to be furnished under contracts of
service or used or consumed in Debtors business, along with all documents
(including documents of title) covering such inventory.
Equipment: Blanket Lien: Any and all of Debtors goods held as equipment,
including, without limitation, all machinery, tools, dies, furnishings, or
fixtures, wherever located, whether now owned or hereafter acquired, together
with all increases, parts, fittings, accessories, equipment, and special tools
now or hereafter.
General Intangibles: Blanket Lien: Any and all of Debtor's general
intangible property, whether now owned or hereafter acquired by Debtor or used
in Debtor's business currently or hereafter, including, without limitation, all
patents, trademarks, service marks, trade secrets, copyrights and exclusive
licenses (whether issued or pending) literary rights, contract rights and all
documents, applications, materials and other matters related thereto, all
inventions, all manufacturing, engineering and production plans, drawings,
specifications, processes and systems, all trade names, goodwill and all chattel
paper, documents and instruments relating to such general intangibles.
B. Substitutions, Proceeds and Related Items. Any and all substitutes and
replacements for, accessions, attachments and other additions to, tools, parts
and equipment now or hereafter added to or used in connection with, and all cash
or non-cash proceeds and products of, the Collateral (including, without
limitation, all income, benefits and property receivable, received or
distributed which results from any of the Collateral, such as dividends payable
or distributable in cash, property or stock; insurance distributions of any kind
related to the Collateral, including, without limitation, returned premiums,
interest, premium and principal payments; redemption proceeds and subscription
rights; and shares or other proceeds of conversions or splits of any securities
in the Collateral); any and
all choses in action and causes of action of Debtor, whether now existing or
hereafter arising, relating directly or indirectly to the Collateral (whether
arising in contract, tort or otherwise and whether or not currently in
litigation); all certificates of title, manufacturer's statements of origin,
other documents, accounts and chattel paper, whether now existing or hereafter
arising directly or indirectly from or related to the Collateral; all
warranties, wrapping, packaging, advertising and shipping materials used or to
be used in connection with or related to the Collateral; all of Debtor's books,
records, data, plans, manuals, computer software, computer tapes, computer
systems, computer disks, computer programs, source codes and object codes
containing any information, pertaining directly or indirectly to the Collateral
and all rights of Debtor to retrieve data and other information pertaining
directly or indirectly to the Collateral from third parties, whether now
existing or hereafter arising; and all returned, refused, stopped in transit, or
repossessed Collateral, any of which, if received by Debtor, upon request shall
be delivered immediately to Bank.
3. Description of Obligation(s). The following obligations ("Obligation" or
"Obligations") are secured by this Agreement: (a) All debts, obligations,
liabilities and agreements of Debtor to Bank, now or hereafter existing, arising
directly or indirectly between Debtor and Bank whether absolute or contingent,
joint or several, secured or unsecured, due or not due, contractual or tortious,
liquidated or unliquidated, arising by operation of law or otherwise, and all
renewals, extensions or rearrangement of any of the above; (b) All costs
incurred by Bank to obtain, preserve, perfect and enforce this Agreement and
maintain, preserve, collect and realize upon the Collateral; (c) All debt,
obligations and liabilities of Debtor to Bank of the kinds described in this
item 3., now existing or hereafter arising; (d) All other costs and reasonable
attorney's fees incurred by Bank, for which Debtor is obligated to reimburse
Bank in accordance with the terms of the Loan Documents (hereinafter defined),
together with interest at the maximum rate allowed by law, or if none, 25% per
annum; and (e) All amounts which may be owed to Bank pursuant to all other Loan
Documents executed between Bank and any other Debtor. If Debtor is not the
obligor of the Obligation, and in the event any amount paid to Bank on any
Obligation is subsequently recovered from Bank in or as a result of any
bankruptcy, insolvency or fraudulent conveyance proceeding, Debtor shall be
liable to Bank for the amounts so recovered up to the fair market value of the
Collateral whether or not the Collateral has been released or the security
interest terminated. In the event the Collateral has been released or the
security interest terminated, the fair market value of the Collateral shall be
determined, at Bank's option, as of the date the Collateral was released, the
security interest terminated, or said amounts were recovered.
4. Debtor's Warranties. Debtor hereby represents and warrants to Bank as
follows:
A. Financing Statements. Except as may be noted by schedule attached
hereto and incorporated herein by reference, no financing statement covering the
Collateral is or will be on file in any public office, except the financing
statements relating to this security interest, and no security interest, other
than the one herein created, has attached or been perfected in the Collateral or
any part thereof except as permitted by Section 5B of the Loan Agreement dated
June 10, 2000.
B. Ownership. Debtor owns, or will use the proceeds of any loans by Bank
to become the owner of, the Collateral free from any setoff, claim, restriction,
lien, security interest or encumbrance except liens for taxes not yet due and
the security interest hereunder.
C. Fixtures and Accessions. None of the Collateral is affixed to real
estate or is an accession to any goods, or will become a fixture or accession,
except as expressly set out herein.
D. Claims of Debtors on the Collateral. To the knowledge of the Borrower,
account debtors and other obligors whose debts or obligations are part of the
Collateral have no right to setoffs, counterclaims or adjustments, and no
defenses in connection therewith.
E. Environmental Compliance. The conduct of Debtor's business operations
and the condition of Debtor's property does not and will not violate any federal
laws, rules or ordinances for environmental protection, regulations of the
Environmental Protection Agency and any applicable local or state law, rule,
regulation or rule of common law and any judicial interpretation thereof
relating primarily to the environment or any materials defined as hazardous
materials or substances under any local, state or federal environmental laws,
rules or regulations, and petroleum, petroleum products, oil and asbestos
("Hazardous Materials").
F. Power and Authority. Debtor has full power and authority to make this
Agreement, and all necessary consents and approvals of any persons, entities,
governmental or regulatory authorities and securities exchanges have been
obtained to effectuate the validity of this Agreement.
5. Debtor's Covenants. Until full payment and performance of all of the
Obligation and termination or expiration of any obligation or commitment of Bank
to make advances or loans to Debtor, unless Bank otherwise consents in writing:
A. Obligation and This Agreement. Debtor shall perform all of its
agreements herein and in any other agreements between it and Bank.
B. Ownership and Maintenance of the Collateral. Debtor shall keep all
tangible Collateral in good condition. Debtor shall defend the Collateral
against all claims and demands of all persons at any time claiming any interest
therein adverse to Bank. Debtor shall keep the Collateral free from all liens
and security interests except those for taxes not yet due and the security
interest hereby created except for those permitted by Section 5B of the Loan
Agreement dated June 10, 2000.
C. Insurance. Debtor shall insure the Collateral with companies
acceptable to Bank. Such insurance shall be in an amount not less than the fair
market value of the Collateral and shall be against such casualties, with such
deductible amounts as Bank shall approve. All insurance policies shall be
written for the benefit of Debtor and Bank as their interests may appear,
payable to Bank as loss payee, or in other form satisfactory to Bank, and such
policies or certificates evidencing the same shall be furnished to Bank. All
policies of insurance shall provide for written notice to Bank at least thirty
(30) days prior to cancellation. Risk of loss or damage is Debtor's to the
extent of any deficiency in any effective insurance coverage.
D. Bank's Costs. Debtor shall pay all costs necessary to obtain,
preserve, perfect, defend and enforce the security interest created by this
Agreement, collect the Obligation, and preserve, defend, enforce and collect the
Collateral, including but not limited to taxes, assessments, insurance premiums,
repairs, rent, storage costs and expenses of sales, legal expenses, reasonable
attorney's fees and other fees or expenses for which Debtor is obligated to
reimburse Bank in accordance with the terms of the Loan Documents. Whether the
Collateral is or is not in Bank's possession, and without any obligation to do
so and without waiving Debtor's default for failure to make any such payment,
Bank at its option may pay any such costs and expenses, discharge encumbrances
on the Collateral, and pay for insurance of the Collateral, and such payments
shall be a part of the Obligation and bear interest at the rate set out in the
Obligation. Debtor agrees to reimburse Bank on demand for any costs so incurred.
E. Information and Inspection. Debtor shall (i) promptly furnish Bank any
information with respect to the Collateral reasonably requested by Bank; (ii)
allow Bank or its representatives to inspect the Collateral, at any reasonable
time and wherever located, and to inspect and copy, or furnish Bank or its
representatives with copies of, all records relating to the Collateral and the
Obligation; (iii) promptly furnish Bank or its representatives such information
as Bank may request to identify the Collateral, at the time and in the form
requested by Bank; and (iv) deliver upon request to Bank shipping and delivery
receipts evidencing the shipment of goods and invoices evidencing the receipt
of, and the payment for, the Collateral.
F. Additional Documents. Debtor shall sign and deliver any papers deemed
necessary or desirable in the judgment of Bank to obtain, maintain, and perfect
the security interest hereunder and to enable Bank to comply with any federal or
state law in order to obtain or perfect Bank's interest in the Collateral or to
obtain proceeds of the Collateral.
G. Parties Liable on the Collateral. Debtor shall preserve the liability
of all obligors on any Collateral, shall preserve the priority of all security
therefor, and shall deliver to Bank the original certificates of title on all
motor vehicles or other titled vehicles constituting the Collateral. Bank shall
have no duty to preserve such liability or security, but may do so at the
expense of Debtor, without waiving Debtor's default
H. Records of the Collateral. Debtor at all times shall maintain accurate
books and records covering the Collateral. Debtor immediately will ▇▇▇▇ all
books and records with an entry showing the absolute assignment of all
Collateral to Bank, and Bank is hereby given the right to audit the books and
records of Debtor relating to the Collateral at any time and from time to time.
The amounts shown as owed to Debtor on Debtor's books, and on any assignment
schedule will be the undisputed amounts owing and unpaid.
I. Disposition of the Collateral. If disposition of any Collateral gives
rise to an account, chattel paper or instrument, Debtor immediately shall notify
Bank, and upon request of Bank shall assign or indorse the same to Bank. No
Collateral may be sold, leased, manufactured, processed or otherwise disposed of
by Debtor in any manner without the prior written consent of Bank, except the
Collateral sold, leased, manufactured, processed or consumed in the ordinary
course of business.
J. Accounts. Each account held as Collateral will represent the valid and
legally enforceable obligation of third parties and shall not be evidenced by
any instrument or chattel paper.
K. Notice/Location of the Collateral. Debtor shall give Bank written
notice of each office of Debtor in which records of Debtor pertaining to
accounts held as Collateral are kept, and each location at which the Collateral
is or will be kept, and of any change of any such location. If no such notice is
given, all records of Debtor pertaining to the Collateral and all Collateral of
Debtor are and shall be kept at the address marked by Debtor above.
L. Change of Name/Status and Notice of Changes. Without the written
consent of Bank, not to be unreasonable withheld Debtor shall not change its
name, change its corporate status, use any trade name or engage in any business
not reasonably related to its business as presently conducted. Debtor shall
notify Bank immediately of (i) any material change in the Collateral, (ii) a
change in Debtors residence or location, (iii) a change in any matter warranted
or represented by Debtor in this Agreement, or in any of the Loan Documents or
furnished to Bank pursuant to this Agreement, and (iv) the occurrence of an
Event of Default (hereinafter defined).
M. Use and Removal of the Collateral. Debtor shall not use the Collateral
illegally. Debtor shall not, unless previously indicated as a fixture, permit
the Collateral to be affixed to real or personal property without the prior
written consent of Bank. Debtor shall not permit any of the Collateral to be
removed from the locations specified herein without the prior written consent of
Bank, except for the sale of inventory in the ordinary course of business.
N. Possession of the Collateral. Upon request by the Bank, debtor shall
deliver all investment securities and other instruments, documents and chattel
paper which are part of the Collateral and in Debtors possession to Bank
immediately, or if hereafter acquired, immediately following acquisition,
appropriately indorsed to Bank's order, or with appropriate, duly executed
powers. Debtor waives presentment, notice of acceleration, demand, notice of
dishonor, protest, and all other notices with respect thereto.
O. Consumer Credit. If any Collateral or proceeds includes obligations of
third parties to Debtor, the transactions giving rise to the Collateral shall
conform in all respects to the applicable state or federal law including but not
limited to consumer credit law. Debtor shall hold harmless and indemnify Bank
against any cost, loss or expense arising from Debtor's breach of this covenant.
P. Power of Attorney. Upon the occurrence of an Event of default, debtor
appoints Bank and any officer thereof as Debtors attorney-in-fact with full
power in Debtors name and behalf to do every act which Debtor is obligated to do
or may be required to do hereunder, however, nothing in this paragraph shall be
construed to obligate Bank to take any action hereunder nor shall Bank be liable
to Debtor for failure to take any action hereunder. This appointment shall be
deemed a power coupled with an interest and shall not be terminable as long as
the Obligation is outstanding and shall not terminate on the disability or
incompetence of Debtor.
Q. Waivers by Debtor. Debtor waives notice of the creation, advance,
increase, existence, extension or renewal of, and of any indulgence with respect
to, the Obligation; waives presentment, demand, notice of dishonor, and protest;
waives notice of the amount of the Obligation outstanding at any time, notice of
any change in financial condition of any person liable for the Obligation or any
part thereof, notice of any Event of Default, and all other notices respecting
the Obligation; and agrees that maturity of the Obligation and any part thereof
may be accelerated,
extended or renewed one or more times by Bank in its discretion, without notice
to Debtor. Debtor waives any right to require that any action be brought against
any other person or to require that resort be had to any other security or to
any balance of any deposit account. Debtor further waives any right of
subrogation or to enforce any right of action against any other Debtor until the
Obligation is paid in full.
R. Other Parties and Other Collateral. No renewal or extension of or any
other indulgence with respect to the Obligation or any part thereof, no release
of any security, no release of any person (including any maker, indorser,
guarantor or surety) liable on the Obligation, no delay in enforcement of
payment, and no delay or omission or lack of diligence or care in exercising any
right or power with respect to the Obligation or any security therefor or
guaranty thereof or under this Agreement shall in any manner impair or affect
the rights of Bank under the law, hereunder, or under any other agreement
pertaining to the Collateral. Bank need not file suit or assert a claim for
personal judgment against any person for any part of the Obligation or seek to
realize upon any other security for the Obligation, before foreclosing or
otherwise realizing upon the Collateral. Debtor waives any right to the benefit
of or to require or control application of any other security or proceeds
thereof, and agrees that Bank shall have no duty or obligation to Debtor to
apply to the Obligation any such other security or proceeds thereof.
S. Collection and Segregation of Accounts and Right to Notify. Upon the
occurrence of an Event of Default, Bank hereby authorizes Debtor to collect the
Collateral, subject to the direction and control of Bank, but Bank may, without
cause or notice, curtail or terminate said authority at any time. Upon notice by
Bank, whether oral or in writing, to Debtor, Debtor shall forthwith upon receipt
of all checks, drafts, cash, and other remittances in payment of or on account
of the Collateral, deposit the same in one or more special accounts maintained
with Bank over which Bank alone shall have the power of withdrawal. The
remittance of the proceeds of such Collateral shall not, however, constitute
payment or liquidation of such Collateral until Bank shall receive good funds
for such proceeds. Funds placed in such special accounts shall be held by Bank
as security for all Obligations secured hereunder. These proceeds shall be
deposited in precisely the form received, except for the endorsement of Debtor
where necessary to permit collection of items, which endorsement Debtor agrees
to make, and which endorsement Bank is also hereby authorized, as attorney-in-
fact, to make on behalf of Debtor. In the event Bank has notified Debtor to make
deposits to a special account, pending such deposit, Debtor agrees that it will
not commingle any such checks, drafts, cash or other remittances with any funds
or other property of Debtor, but will hold them separate and apart therefrom,
and upon an express trust for Bank until deposit thereof is made in the special
account. Bank will, from time to time, apply the whole or any part of the
Collateral funds on deposit in this special account against such Obligations as
are secured hereby as Bank may in its sole discretion elect. At the sole
election of Bank, any portion of said funds on deposit in the special account
which Bank shall elect not to apply to the Obligations, may be paid over by Bank
to Debtor. At any time, whether Debtor is or is not in default hereunder, Bank
may notify persons obligated on any Collateral to make payments directly to Bank
and Bank may take control of all proceeds of any Collateral. Until Bank elects
to exercise such rights, Debtor, as agent of Bank, shall collect and enforce all
payments owed on the Collateral,
T. Compliance with State and Federal Laws. Debtor will maintain its
existence, good standing and qualification to do business, where required, and
comply with all laws, regulations and governmental requirements, including
without limitation, environmental laws applicable to it or any of its property,
business operations and transactions.
U. Environmental Covenants. Debtor shall immediately advise Bank in
writing of (i) any and all enforcement, cleanup, remedial, removal, or other
governmental or regulatory actions instituted, completed or threatened pursuant
to any applicable federal, state, or local laws, ordinances or regulations
relating to any Hazardous Materials affecting Debtors business operations; and
(ii) all claims made or threatened by any third party against Debtor relating to
damages, contribution, cost recovery, compensation, loss or injury resulting
from any Hazardous Materials. Debtor shall immediately notify Bank of any
remedial action taken by Debtor with respect to Debtors business operations.
Debtor will not use or permit any other party to use any Hazardous Materials at
any of Debtors places of business or at any other property owned by Debtor
except such materials as are incidental to Debtors normal course of business,
maintenance and repairs and which are handled in compliance with all applicable
environmental laws. Debtor agrees to permit Bank, its agents, contractors and
employees to enter and inspect any of Debtor's places of business or any other
property of Debtor at any reasonable times upon three (3) days prior notice for
the purposes of conducting an environmental investigation and audit (including
taking physical samples) to insure
that Debtor is complying with this covenant and Debtor shall reimburse Bank on
demand for the costs of any such environmental investigation and audit. Debtor
shall provide Bank, its agents, contractors, employees and representatives with
access to and copies of any and all data and documents relating to or dealing
with any Hazardous Materials used, generated, manufactured, stored or disposed
of by Debtors business operations within five (5) days of the request therefor.
6. Rights and Powers of Bank.
A. General. Bank, before default, without liability to Debtor may: obtain
from any person information regarding Debtor or Debtor's business, which
information any such person also may furnish without liability to Debtor;
release the Collateral in its possession to any Debtor, temporarily or
otherwise; reject as unsatisfactory any property hereafter offered by Debtor as
Collateral; set standards from time to time to govern what may be used as after
acquired Collateral; designate, from time to time, a certain percent of the
Collateral as the loan value and require Debtor to maintain the Obligation at or
below such figure; Bank shall not be liable for failure to collect any account
or instruments, or for any act or omission on the part of Bank, its officers,
agents or employees, except for its or their own willful misconduct or gross
negligence. The foregoing rights and powers of Bank will be in addition to, and
not a limitation upon, any rights and powers of Bank given by law, elsewhere in
this Agreement, or otherwise. If Debtor fails to maintain any required
insurance, to the extent permitted by applicable law Bank may (but is not
obligated to) purchase single interest insurance coverage for the Collateral
which insurance may at Bank's option (i) protect only Bank and not provide any
remuneration or protection for Debtor directly and (ii) provide coverage only
after the Obligation has been declared due as herein provided, The premiums for
any such insurance purchased by Bank shall be a part of the Obligation and shall
bear interest as provided in 3(d) hereof. Bank, after default, without liability
to Debtor may: require Debtor to give possession or control of any Collateral to
Bank; indorse as Debtor's agent any instruments, documents or chattel paper in
the Collateral or representing proceeds of the Collateral; contact account
debtors directly to verify information furnished by Debtor, take control of
proceeds, including stock received as dividends or by reason of stock splits;
require additional Collateral; take control of funds generated by the
Collateral, such as cash dividends, interest and proceeds or refunds from
insurance, and use same to reduce any part of the Obligation and exercise all
other rights which an owner of such Collateral may exercise, except the right to
vote or dispose of the Collateral before an Event of Default; at any time
transfer any of the Collateral or evidence thereof into its own name or that of
its nominee; and demand, collect, convert, redeem, receipt for, settle,
compromise, adjust, ▇▇▇ for, foreclose or realize upon the Collateral, in its
own name or in the name of Debtor, as Bank may determine.
B. Convertible Collateral. Bank may present for conversion any Collateral
which is convertible into any other instrument or investment security or a
combination thereof with cash, but Bank shall not have any duty to present for
conversion any Collateral unless it shall have received from Debtor detailed
written instructions to that effect at a time reasonably far in advance of the
final conversion date to make such conversion possible.
7. Default.
A. Event of Default. An event of default ("Event of Default") shall occur
if: (i) there is a loss, theft, damage or destruction of any material portion of
the Collateral for which there is no insurance coverage or for which, in the
opinion of Bank, there is insufficient insurance coverage; (ii) Debtor or any
other obligor on all or part of the Obligation shall fail to timely and properly
pay or observe, keep or perform any term, covenant, agreement or condition in
this Agreement and not remedied or cured under Section 6 of the Loan Agreement
dated June 10, 2000 or in any other agreement between Debtor and Bank or between
Bank and any other obligor on the Obligation, including, but not limited to, any
other note or instrument, loan agreement, security agreement, deed of trust,
mortgage, promissory note, guaranty, certificate, assignment, instrument,
document or other agreement concerning or related to the Obligation
(collectively, the "Loan Documents"); (iii) Debtor or such other obligor shall
fail to timely and property pay or observe, keep or perform any term, covenant,
agreement or condition in any agreement between such party and any affiliate or
subsidiary of Bank of America Corporation; (iv) Debtor or such other obligor
shall fail to timely and property pay or observe, keep or perform any term,
covenant, agreement or condition in any lease agreement between such party and
any lessor pertaining to premises at which any Collateral is located or stored;
or (v) Debtor or such other obligor abandons any leased premises at which any
Collateral is located or stored and the
Collateral is either moved without the prior written consent of Bank or the
Collateral remains at the abandoned premises.
B. Rights and Remedies. If any Event of Default shall occur, then, in
each and every such case, Bank may, without presentment, demand, or protest;
notice of default, dishonor, demand, non-payment, or protest; notice of intent
to accelerate all or any part of the Obligation; notice of acceleration of all
or any part of the Obligation; or notice of any other kind, all of which Debtor
hereby expressly waives, (except for any notice required under this Agreement,
any other Loan Document or applicable law); at any time thereafter exercise
and/or enforce any of the following rights and remedies at Bank's option:
i. Acceleration. The Obligation shall, at Bank's option, become
immediately due and payable, and the obligation, if any, of Bank to permit
further borrowings under the Obligation shall at Bank's option immediately cease
and terminate.
ii. Possession and Collection of the Collateral. At its option: (a) take
possession or control of, store, lease, operate, manage, sell, or instruct any
Agent or Broker to sell or otherwise dispose of, all or any part of the
Collateral; (b) notify all parties under any account or contract right forming
all or any part of the Collateral to make any payments otherwise due to Debtor
directly to Bank; (c) in Bank's own name, or in the name of Debtor, demand,
collect, receive, ▇▇▇ for, and give receipts and releases for, any and all
amounts due under such accounts and contract rights; (d) indorse as the agent of
Debtor any check, note, chattel paper, documents, or instruments forming all or
any part of the Collateral; (e) make formal application for transfer to Bank (or
to any assignee of Bank or to any purchaser of any of the Collateral) of all of
Debtor's permits, licenses, approvals, agreements, and the like relating to the
Collateral or to Debtors business; (@ take any other action which Bank deems
necessary or desirable to protect and realize upon its security interest in the
Collateral; and (g) in addition to the foregoing, and not in substitution
therefor, exercise any one or more of the rights and remedies exercisable by
Bank under any other provision of this Agreement, under any of the other Loan
Documents, or as provided by applicable law (including, without limitation, the
Uniform Commercial Code as in effect in Maryland (hereinafter referred to as the
"UCC")). In taking possession of the Collateral Bank may enter Debtors premises
and otherwise proceed without legal process, if this can be done without breach
of the peace. Debtor shall, upon Bank's demand, promptly make the Collateral or
other security available to Bank at a place designated by Bank, which place
shall be reasonably convenient to both parties.
Bank shall not be liable for, nor be prejudiced by, any loss, depreciation or
other damages to the Collateral, unless caused by Bank's willful and malicious
act. Bank shall have no duty to take any action to preserve or collect the
Collateral.
iii. Receiver. Upon the occurrence of an Event of Default, obtain the
appointment of a receiver for all or any of the Collateral, Debtor hereby
consenting to the appointment of such a receiver and agreeing not to oppose any
such appointment.
iv. Right of Set Off. Without notice or demand to Debtor, set off and
apply against any and all of the Obligation any and all deposits (general or
special, time or demand, provisional or final) and any other indebtedness, at
any time held or owing by Bank or any of Bank's agents or affiliates to or for
the credit of the account of Debtor or any guarantor or indorser of Debtor's
Obligation.
Upon the occurrence of an Event of Default, Bank shall be entitled to immediate
possession of all books and records evidencing any Collateral or pertaining to
chattel paper covered by this Agreement and it or its representatives shall have
the authority to enter upon any premises upon which any of the same, or any
Collateral, may be situated and remove the same therefrom without liability.
Bank may surrender any insurance policies in the Collateral and receive the
unearned premium thereon. Debtor shall be entitled to any surplus and shall be
liable to Bank for any deficiency. The proceeds of any disposition after
default available to satisfy the Obligation shall be applied to the Obligation
in such order and in such manner as Bank in its discretion shall decide.
Debtor specifically understands and agrees that any sale by Bank of all or part
of the Collateral pursuant to the terms of this Agreement may be effected by
Bank at times and in manners which could result in the proceeds of such sale as
being significantly and materially less than might have been received if such
sale had occurred at different times
or in different manners, and Debtor hereby releases Bank and its officers and
representatives from and against any and all obligations and liabilities arising
out of or related to the timing or manner of any such sale.
If, in the opinion of Bank, there is any question that a public sale or
distribution of any Collateral will violate any state or federal securities law,
Bank may offer and sell such Collateral in a transaction exempt from
registration under federal securities law, and any such sale made in good faith
by Bank shall be deemed "commercially reasonable".
8. General.
A. Parties Bound. Bank's rights hereunder shall inure to the benefit of
its successors and assigns. In the event of any assignment or transfer by Bank
of any of the Obligation or the Collateral, Bank thereafter shall be fully
discharged from any responsibility with respect to the Collateral so assigned or
transferred, but Bank shall retain all rights and powers hereby given with
respect to any of the Obligation or the Collateral not so assigned or
transferred. All representations, warranties and agreements of Debtor if more
than one are joint and several and all shall be binding upon the personal
representatives, heirs, successors and assigns of Debtor.
B. Waiver. No delay of Bank in exercising any power or right shall
operate as a waiver thereof, nor shall any single or partial exercise of any
power or right preclude other or further exercise thereof or the exercise of any
other power or right. No waiver by Bank of any right hereunder or of any default
by Debtor shall be binding upon Bank unless in writing, and no failure by Bank
to exercise any power or right hereunder or waiver of any default by Debtor
shall operate as a waiver of any other or further exercise of such right or
power or of any further default. Each right, power and remedy of Bank as
provided for herein or in any of the Loan Documents, or which shall now or
hereafter exist at law or in equity or by statute or otherwise, shall be
cumulative and concurrent and shall be in addition to every other such right,
power or remedy. The exercise or beginning of the exercise by Bank of any one or
more of such rights, powers or remedies shall not preclude the simultaneous or
later exercise by Bank of any or all other such rights, powers or remedies.
C. Agreement Continuing. This Agreement shall constitute a continuing
agreement, applying to all future as well as existing transactions, whether or
not of the character contemplated at the date of this Agreement, and if all
transactions between Bank and Debtor shall be closed at any time, shall be
equally applicable to any new transactions thereafter. Provisions of this
Agreement, unless by their terms exclusive, shall be in addition to other
agreements between the parties. Time is of the essence of this Agreement.
D. Definitions. Unless the context indicates otherwise, definitions in
the UCC apply to words and phrases in this Agreement; if UCC definitions
conflict, Article 9 definitions apply.
E. Notices. Notice shall be deemed reasonable if mailed postage prepaid
at least five (5) days before the related action (or if the UCC elsewhere
specifies a longer period, such longer period) to the address of Debtor given
above, or to such other address as any party may designate by written notice to
the other party. Each notice, request and demand shall be deemed given or made,
if sent by mail, upon the earlier of the date of receipt or five (5) days after
deposit in the U.S. Mail, first class postage prepaid, or if sent by any other
means, upon delivery.
F. Modifications. No provision hereof shall-be modified or limited except
by a written agreement expressly referring hereto and to the provision so
modified or limited and signed by Debtor and Bank. The provisions of the
Agreement shall not be modified or limited by course of conduct or usage of
trade.
G. Applicable Law and Partial Invalidity. This Agreement has been
delivered in the State of Maryland and shall be construed in accordance with the
laws of that State. Wherever possible each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited by or invalid under
applicable law, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provisions
or the remaining provisions of this Agreement. The invalidity or
unenforceability of any provision of any Loan Document to any person or
circumstance shall not affect the enforceability or validity of such provision
as it may apply to other persons or circumstances.
H. Financing Statement. To the extent permitted by applicable law, a
carbon, photographic or other reproduction of this Agreement or any financing
statement covering the Collateral shall be sufficient as a financing statement.
I. WAIVER OF JURY TRIAL. DEBTOR WAIVES TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO WHICH DEBTOR AND BANK MAY BE PARTIES, ARISING OUT OF OR IN
CONNECTION WITH OR IN ANY WAY PERTAINING TO THIS AGREEMENT, OR THE LOAN
DOCUMENTS. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER OF
TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTION OR PROCEEDINGS,
INCLUDING CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS AGREEMENT. THIS
WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY DEBTOR.
J. Controlling Document. To the extent that this Security Agreement
conflicts with or is in any way incompatible with any other Loan Document
concerning the Obligation, any promissory note shall control over any other
document, and if such note does not address an issue, then each other document
shall control to the extent that it deals most specifically with an issue.
K. Execution Under Seal. This Agreement is being executed under seal by
Debtor(s).
L. Additional Provisions. See Schedule "__" attached hereto and
incorporated hereunder for all purposes.
M. NOTICE OF FINAL AGREEMENT. THIS WRITTEN SECURITY AGREEMENT AND THE
OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY
NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
IN WITNESS WHEREOF AND INTENDING TO CREATE AN INSTRUMENT EXECUTED UNDER SEAL,
the parties hereto have caused this Security Agreement to be duly executed under
seal by their duly authorized representatives as of the date first above
written.
Bank/Secured Party:
Bank of America, N.A.
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Title: Senior Vice President
Corporate or Partnership Debtor/Pledgor:
OPNET Technologies, Inc.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ (Seal)
------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Title: SVP & CFO
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By: (Seal)
------------------------------
Name:
----------------------------
Title:
---------------------------
---------------------------------
Attest (If Applicable)
[Corporate Seal]