Attached files
file | filename |
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10-Q - FORM 10-Q - ARGAN INC | c02102e10vq.htm |
EX-32.2 - EXHIBIT 32.2 - ARGAN INC | c02102exv32w2.htm |
EX-32.1 - EXHIBIT 32.1 - ARGAN INC | c02102exv32w1.htm |
EX-10.1 - EXHIBIT 10.1 - ARGAN INC | c02102exv10w1.htm |
EX-31.1 - EXHIBIT 31.1 - ARGAN INC | c02102exv31w1.htm |
EX-31.2 - EXHIBIT 31.2 - ARGAN INC | c02102exv31w2.htm |
Exhibit
10.2
FIFTH AMENDED AND RESTATED REVOLVING CREDIT NOTE
$4,250,000 | Rockville, Maryland | |
April 26, 2010 |
FOR VALUE RECEIVED, ARGAN, INC., a corporation organized under the laws of the State of
Delaware (Argan), SOUTHERN MARYLAND CABLE, INC., a corporation organized under the laws of the
State of Delaware (SMC), VITARICH LABORATORIES, INC., a corporation organized under the laws of
the State of Delaware (Vitarich) GEMMA POWER, INC., a corporation organized under the laws of the
State of Connecticut (GP), GEMMA POWER SYSTEMS CALIFORNIA, INC., a corporation organized under
the laws of the State of California (GPSC), GEMMA POWER SYSTEMS, LLC, a limited liability company
organized under the laws of the state of Connecticut (GPS), and GEMMA POWER HARTFORD, LLC, a
limited liability company organized under the laws of the State of Connecticut (GPH), jointly and
severally (each of Argan, SMC, Vitarich, GP, GPSC, GPS, and GPH, a Borrower and collectively, the
Borrowers); promise to pay to the order of BANK OF AMERICA, N.A., a national banking association,
its successors and assigns (the Lender), the principal sum of FOUR MILLION TWO HUNDRED FIFTY
THOUSAND DOLLARS ($4,250,000) (the Principal Sum), or so much thereof as has been or may be
advanced or readvanced to or for the account of the Borrowers pursuant to the terms and conditions
of this Fifth Amended and Restated Revolving Credit Note (including all renewals, extensions or
modifications hereof, this Note), together with interest thereon at the rate or rates hereinafter
provided, in accordance with the following:
1. Interest.
Commencing as of the date hereof and continuing until repayment in full of all sums due
hereunder, the unpaid Principal Sum shall bear interest at the LIBOR Rate plus two and one quarter
percent (2.25%) per annum. For purposes hereof, the LIBOR Rate shall mean a daily fluctuating
rate equal to the one (1) month rate of interest (rounded upwards, if necessary to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the one (1) month London
interbank offered rate for deposits in U.S. Dollars at approximately 11:00 A.M. (London, time), on
the second preceding business day, as adjusted from time to time in the Lenders sole discretion
for then-applicable reserve requirements, deposits insurance assessment rates and other regulatory
costs. If for any reason such rate is not available, the term LIBOR Rate shall mean the
fluctuating rate of interest equal to the one (1) month rate of interest (rounded upwards, if
necessary to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the one (1) month
London interbank offered rate for deposits in U.S. Dollars at approximately 11:00 a.m. (London
Time) on the second preceding business day, as adjusted from time to time 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 page, the applicable rate shall
be the arithmetic mean of all such rates.
The rate of interest charged under this Note shall change immediately and contemporaneously
with any change in the LIBOR Rate. All interest payable under the terms of this Note shall be
calculated on the basis of a 360-day year and the actual number of days elapsed.
2. Payments and Maturity.
The unpaid Principal Sum, together with interest thereon at the rate or rates provided above,
shall be payable as follows:
(a) Interest only on the unpaid Principal Sum shall be due and payable monthly, commencing May
31, 2010, and on the last day of each month thereafter to maturity; and
(b) Unless sooner paid, the unpaid Principal Sum, together with interest accrued and unpaid
thereon, shall be due and payable in full on the Revolving Credit Expiration Date.
The fact that the balance hereunder may be reduced to zero from time to time pursuant to the
Financing Agreement will not affect the continuing validity of this Note or the Financing
Agreement, and the balance may be increased to the Principal Sum after any such reduction to zero.
Borrower hereby authorizes Lender to automatically deduct from Borrowers account numbered
003939628068 the amount of each payment of principal (including without limitation the principal
payment due on the final maturity date) and/or interest on the dates such payments become due. If
the funds in the account are insufficient to cover any payment, Lender shall not be obligated to
advance funds to cover the payment. At any time and for any reason, Borrower or Lender may
voluntarily terminate automatic payments as provided in this paragraph.
3. Default Interest.
Upon the occurrence of an Event of Default (as hereinafter defined), the unpaid Principal Sum
shall bear interest thereafter at the LIBOR Rate plus four percent (4.00%) (the Post-Default
Rate) until such Event of Default is cured.
4. Late Charges.
If the Borrowers shall fail to make any payment under the terms of this Note within five (5)
days after the date such payment is due, the Borrowers shall pay to the Lender on demand a late
charge equal to five percent (5%) of such payment.
5. Application and Place of Payments.
All payments, made on account of this Note shall be applied first to the payment of accrued
and unpaid interest then due hereunder, and the remainder, if any, shall be applied to the unpaid
Principal Sum. All payments on account of this Note shall be paid in lawful money of the United
States of America in immediately available funds during regular business hours of the Lender at its
principal office in Rockville, Maryland or at such other times and places as the Lender may at any
time and from time to time designate in writing to the Borrowers.
2
6. Financing Agreement and Other Financing Documents.
This Note is the Revolving Credit Note described in the Second Amended and Restated
Financing and Security Agreement, dated December 11, 2006, by and among the Borrowers and the
Lender (as amended, modified, restated, substituted, extended and renewed at
any time and from time to time, the Financing Agreement). This Note amends and restates in
its entirety that certain Fourth Amended and Restated Revolving Credit Note (the Prior Note) in
the maximum principal sum of Four Million Two Hundred Fifty Thousand Dollars ($4,250,000) dated
December 11, 2006 in favor of the Lender. It is expressly agreed that the indebtedness evidenced
by the Prior Note has not been extinguished or discharged hereby. Each of the Borrowers and the
Lender agree that the execution of this Note is not intended to and shall not cause or result in a
novation with respect to the Prior Note. The indebtedness evidenced by this Note is included
within the meaning of the term Obligations as defined in the Financing Agreement. The term
Financing Documents as used in this Note shall mean collectively this Note, the Acquisition Term
Note, the Financing Agreement, the Security Agreements, the Guaranty, and any other instrument,
agreement, or document previously, simultaneously, or hereafter executed and delivered by any
Borrower, any Guarantor, and/or any other Person, singularly or jointly with any other Person,
evidencing, securing, guaranteeing, or in connection with the Principal Sum, this Note, the
Acquisition Term Note and/or the Financing Agreement.
7. Security.
This Note is secured as provided in the Financing Agreement.
8. Events of Default.
The occurrence of any one or more of the following events shall constitute an event of default
(individually, an Event of Default and collectively, the Events of Default) under the terms of
this Note:
(a) The failure of any Borrower to pay to the Lender within five (5) days of when due any and
all amounts payable by any Borrower to the Lender under the terms of this Note; or
(b) The occurrence of an Event of Default (as defined therein) under the terms and conditions
of any of the other Financing Documents.
9. Remedies.
Upon the occurrence of an Event of Default, at the option of the Lender, all amounts payable
by the Borrowers to the Lender under the terms of this Note shall immediately become due and
payable by the Borrowers to the Lender without notice to the Borrowers or any other Person, and the
Lender shall have all of the rights, powers, and remedies available under the terms of this Note,
any of the other Financing Documents and all applicable laws. The Borrowers and all endorsers,
guarantors, and other parties who may now or in the future be primarily or secondarily liable for
the payment of the indebtedness evidenced by this Note hereby severally waive presentment, protest
and demand, notice of protest, notice of demand and of dishonor and non-payment of this Note and
expressly agree that this Note or any payment hereunder may be extended from time to time without
in any way affecting the liability of the Borrowers, guarantors and endorsers.
3
10. Confessed Judgment.
UPON THE OCCURRENCE OF AN EVENT OF DEFAULT, EACH BORROWER HEREBY AUTHORIZES ANY ATTORNEY
DESIGNATED BY THE LENDER OR ANY
CLERK OF ANY COURT OF RECORD TO APPEAR FOR THE BORROWERS IN ANY COURT OF RECORD AND CONFESS
JUDGMENT WITHOUT PRIOR HEARING AGAINST THE BORROWERS IN FAVOR OF THE LENDER FOR AND IN THE AMOUNT
OF THE UNPAID PRINCIPAL SUM, ALL INTEREST ACCRUED AND UNPAID THEREON, ALL OTHER AMOUNTS PAYABLE BY
ANY BORROWER TO THE LENDER UNDER THE TERMS OF THIS NOTE OR ANY OF THE OTHER FINANCING DOCUMENTS,
COSTS OF SUIT, AND ATTORNEYS FEES OF FIFTEEN PERCENT (15%) OF THE UNPAID PRINCIPAL SUM AND
INTEREST THEN DUE HEREUNDER. BY ITS ACCEPTANCE OF THIS NOTE, THE LENDER AGREES THAT IN THE EVENT
THE LENDER EXERCISES AT ANY TIME ITS RIGHT TO CONFESS JUDGMENT UNDER THIS NOTE, THE LENDER SHALL
USE ITS BEST EFFORTS TO OBTAIN LEGAL COUNSEL WHO WILL CHARGE THE LENDER FOR ITS SERVICES ON AN
HOURLY BASIS, AT ITS CUSTOMARY HOURLY RATES AND ONLY FOR THE TIME AND REASONABLE EXPENSES INCURRED.
IN NO EVENT SHALL THE LENDER ENFORCE THE LEGAL FEES PORTION OF A CONFESSED JUDGMENT AWARD FOR AN
AMOUNT IN EXCESS OF THE FEES AND EXPENSES ACTUALLY CHARGED TO THE LENDER FOR SERVICES RENDERED BY
ITS COUNSEL IN CONNECTION WITH SUCH CONFESSION OF JUDGMENT AND/OR THE COLLECTION OF SUMS OWED TO
THE LENDER. IN THE EVENT THE LENDER RECEIVES, THROUGH EXECUTION UPON A CONFESSED JUDGMENT,
PAYMENTS ON ACCOUNT OF ATTORNEYS FEES IN EXCESS OF SUCH ACTUAL ATTORNEYS FEES AND EXPENSES
INCURRED BY THE LENDER, THEN, AFTER FULL REPAYMENT AND SATISFACTION OF ALL OF THE OBLIGATIONS UNDER
AND IN CONNECTION WITH THIS NOTE, THE FINANCING AGREEMENT AND ALL OF THE OTHER FINANCING DOCUMENTS,
THE LENDER SHALL REFUND SUCH EXCESS AMOUNT TO THE BORROWERS. EACH BORROWER HEREBY RELEASES, TO THE
EXTENT PERMITTED BY APPLICABLE LAW, ALL ERRORS AND ALL RIGHTS OF EXEMPTION, APPEAL, STAY OF
EXECUTION, INQUISITION, AND OTHER RIGHTS TO WHICH ANY BORROWER MAY OTHERWISE BE ENTITLED UNDER THE
LAWS OF THE UNITED STATES OF AMERICA OR OF ANY STATE OR POSSESSION OF THE UNITED STATES OF AMERICA
NOW IN FORCE OR WHICH MAY HEREAFTER BE ENACTED. THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER
JUDGMENT AGAINST THE BORROWERS SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISES THEREOF OR BY ANY
IMPERFECT EXERCISE THEREOF AND SHALL NOT BE EXTINGUISHED BY ANY JUDGMENT ENTERED PURSUANT THERETO.
SUCH AUTHORITY MAY BE EXERCISED ON ONE OR MORE OCCASIONS OR FROM TIME TO TIME IN THE SAME OR
DIFFERENT JURISDICTIONS AS OFTEN AS THE LENDER SHALL DEEM NECESSARY OR DESIRABLE, FOR ALL OF WHICH
THIS NOTE SHALL BE A SUFFICIENT WARRANT.
11. Expenses.
Each Borrower promises to pay to the Lender on demand by the Lender all costs and expenses
incurred by the Lender in connection with the collection and enforcement of this Note, including,
without limitation, reasonable attorneys fees and expenses and all court costs.
4
12. Notices.
Any notice, request, or demand to or upon the Borrowers or the Lender shall be deemed to have
been properly given or made when delivered in accordance with Section 8.1 of the Financing
Agreement.
13. Miscellaneous.
Each right, power, and remedy of the Lender as provided for in this Note or any of the other
Financing Documents, or now or hereafter existing under any applicable law or otherwise shall be
cumulative and concurrent and shall be in addition to every other right, power, or remedy provided
for in this Note or any of the other Financing Documents or now or hereafter existing under any
applicable law, and the exercise or beginning of the exercise by the Lender of any one or more of
such rights, powers, or remedies shall not preclude the simultaneous or later exercise by the
Lender of any or all such other rights, powers, or remedies. No failure or delay by the Lender to
insist upon the strict performance of any term, condition, covenant, or agreement of this Note or
any of the other Financing Documents, or to exercise any right, power, or remedy consequent upon a
breach thereof, shall constitute a waiver of any such term, condition, covenant, or agreement or of
any such breach, or preclude the Lender from exercising any such right, power, or remedy at a later
time or times. By accepting payment after the due date of any amount payable under the terms of
this Note, the Lender shall not be deemed to waive the right either to require prompt payment when
due of all other amounts payable under the terms of this Note or to declare an Event of Default for
the failure to effect such prompt payment of any such other amount. No course of dealing or
conduct shall be effective to amend, modify, waive, release, or change any provisions of this Note.
Until such time as the Lender is not committed to extend further credit to the Borrowers and
all Obligations of the Borrowers to the Lender have been indefeasibly paid in full in cash, and
subject to and not in limitation of the provisions set forth in the next following paragraph below,
no Borrower shall have any right of subrogation (whether contractual, arising under the bankruptcy
code or otherwise), reimbursement or contribution from any Borrower or any guarantor, nor any right
of recourse to its security for any of the debts and obligations of any Borrower which are the
subject of this Note. Except as otherwise expressly permitted by the Financing Agreement, any and
all present and future debts and obligations of any Borrower to any other Borrower are hereby
subordinated to the full payment and performance of all present and future debts and obligations to
the Lender under this Note and the Financing Agreement and the Financing Documents, provided,
however, notwithstanding anything set forth in this Note to the contrary, prior to the occurrence
of a payment Default, the Borrowers shall be permitted to make payments on account of any of such
present and future debts and obligations from time to time in accordance with the terms thereof.
5
Each Borrower further agrees that, if any payment made by any Borrower or any other person is
applied to this Note and is at any time annulled, set aside, rescinded, invalidated, declared to be
fraudulent or preferential or otherwise required to be refunded or repaid, or the proceeds of any
property hereafter securing this Note is required to be returned by the Lender to any Borrower, its
estate, trustee, receiver or any other party, including, without limitation, such Borrower, under
any bankruptcy law, state or federal law, common law or equitable cause, then, to the extent of
such payment or repayment, such Borrowers liability hereunder
(and any lien, security interest or other collateral securing such liability) shall be and remain in full
force and effect, as fully as if such payment had never been made, or, if prior thereto any such
lien, security interest or other collateral hereafter securing such Borrowers liability hereunder
shall have been released or terminated by virtue of such cancellation or surrender, this Note (and
such lien, security interest or other collateral) shall be reinstated in full force and effect, and
such prior cancellation or surrender shall not diminish, release, discharge, impair or otherwise
affect the obligations of such Borrower in respect of the amount of such payment (or any lien,
security interest or other collateral securing such obligation).
The JOINT AND SEVERAL obligations of each Borrower under this Note shall be absolute,
irrevocable and unconditional and shall remain in full force and effect until the outstanding
principal of and interest on this Note and all other Obligations or amounts due hereunder and under
the Financing Agreement and the Financing Documents shall have been indefeasibly paid in full in
cash in accordance with the terms thereof and this Note shall have been canceled.
The Borrowers each shall be jointly and severally liable on the payment of the Obligations as
and when due and payable in accordance with the provisions of this Note, the Financing Agreement
and the other Financing Documents. The term Borrowers when used in this Note shall include all
of the Borrowers, individually and jointly, and the Lender may (without notice to or consent of any
or all of the Borrowers and with or without consideration) release, compromise, settle with,
proceed against any or all of the Borrowers without affecting, impairing, lessening or releasing
the obligations of the other Borrower hereunder.
14. Partial Invalidity.
In the event any provision of this Note (or any part of any provision) is held by a court of
competent jurisdiction to be invalid, illegal, or unenforceable in any respect, such invalidity,
illegality, or unenforceability shall not affect any other provision (or remaining part of the
affected provision) of this Note; but this Note shall be construed as if such invalid, illegal, or
unenforceable provision (or part thereof) had not been contained in this Note, but only to the
extent it is invalid, illegal, or unenforceable.
15. Captions.
The captions herein set forth are for convenience only and shall not be deemed to define,
limit, or describe the scope or intent of this Note.
6
16. Applicable Law.
Each Borrower acknowledges and agrees that this Note shall be governed by the laws of the
State of Maryland, even though for the convenience and at the request of the Borrowers, this Note
may be executed elsewhere.
17. Consent to Jurisdiction.
Each Borrower irrevocably submits to the jurisdiction of any state or federal court sitting in
the State of Maryland over any suit, action, or proceeding arising out of or relating to this Note
or any of the other Financing Documents. Each Borrower irrevocably waives, to the fullest extent
permitted by law, any objection that any Borrower may now or hereafter have to the
laying of venue of any such suit, action, or proceeding brought in any such court and any
claim that any such suit, action, or proceeding brought in any such court has been brought in an
inconvenient forum. Final judgment in any such suit, action, or proceeding brought in any such
court shall be conclusive and binding upon the Borrowers and may be enforced in any court in which
any Borrower is subject to jurisdiction by a suit upon such judgment, provided that service of
process is effected upon the Borrowers as provided in this Note or as otherwise permitted by
applicable law.
18. Service of Process.
Each Borrower hereby irrevocably designates and appoints The Corporation Trust Company,
Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware 19801, as each Borrowers
authorized agent to receive on each Borrowers behalf service of any and all process that may be
served in any suit, action, or proceeding instituted in connection with this Note in any state or
federal court sitting in the State of Maryland. If such agent shall cease so to act, the Borrowers
shall irrevocably designate and appoint without delay another such agent in the State of Maryland
satisfactory to the Lender and shall promptly deliver to the Lender evidence in writing of such
agents acceptance of such appointment and its agreement that such appointment shall be
irrevocable.
Each Borrower hereby consents to process being served in any suit, action, or proceeding
instituted in connection with this Note by (a) the mailing of a copy thereof by certified mail,
postage prepaid, return receipt requested, to each Borrower and (b) serving a copy thereof upon the
agent hereinabove designated and appointed by each Borrower as each Borrowers agent for service of
process. Each Borrower irrevocably agrees that such service shall be deemed in every respect
effective service of process upon the Borrowers in any such suit, action or proceeding, and shall,
to the fullest extent permitted by law, be taken and held to be valid personal service upon the
Borrowers. Nothing in this Section shall affect the right of the Lender to serve process in any
manner otherwise permitted by law or limit the right of the Lender otherwise to bring proceedings
against the Borrowers in the courts of any jurisdiction or jurisdictions.
7
19. WAIVER OF TRIAL BY JURY.
EACH BORROWER AND THE LENDER HEREBY WAIVE TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO WHICH
ANY BORROWER AND THE LENDER MAY BE PARTIES, ARISING OUT OF OR IN ANY WAY PERTAINING TO (A) THIS
NOTE OR (B) THE FINANCING DOCUMENTS. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A
WAIVER OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING
CLAIMS AGAINST PARTIES WHO ARE NOT PARTIES TO THIS NOTE.
THIS WAIVER IS KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE BY EACH BORROWER, AND EACH BORROWER
HEREBY REPRESENTS THAT NO REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY INDIVIDUAL TO
INDUCE THIS WAIVER OF TRIAL BY JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. EACH BORROWER
FURTHER REPRESENTS THAT IT HAS BEEN REPRESENTED IN THE SIGNING OF THIS NOTE AND IN THE
MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND THAT
EACH HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
[SIGNATURES APPEAR ON THE FOLLOWING PAGES]
8
IN WITNESS WHEREOF, the Borrowers have caused this Note to be executed under seal by their
duly authorized officers as of the date first written above.
WITNESS/ATTEST: | ARGAN, INC. | |||||||||
/s/ Sherolyn Nanson
|
By: | /s/ Rainer Bosselmann
|
(Seal) | |||||||
Chairman of the Board and President | ||||||||||
WITNESS/ATTEST: | SOUTHERN MARYLAND CABLE, INC. | |||||||||
/s/ Sherolyn Nanson
|
By: | /s/ Arthur Trudel
|
(Seal) | |||||||
Vice President and Treasurer | ||||||||||
WITNESS/ATTEST: | VITARICH LABORATORIES, INC. | |||||||||
/s/ Sherolyn Nanson
|
By: | /s/ Arthur Trudel
|
(Seal) | |||||||
Vice President and Treasurer | ||||||||||
WITNESS/ATTEST: | GEMMA POWER, INC. | |||||||||
/s/ Sherolyn Nanson
|
By: | /s/ Arthur Trudel
|
(Seal) | |||||||
Chief Financial Officer | ||||||||||
WITNESS/ATTEST: | GEMMA POWER SYSTEMS CALIFORNIA, INC. | |||||||||
/s/ Sherolyn Nanson
|
By: | /s/ Arthur Trudel
|
(Seal) | |||||||
Chief Financial Officer |
Signature Page to Fifth Amended and Restated Revolving Credit Note
WITNESS/ATTEST: | GEMMA POWER SYSTEMS, LLC | |||||||||
/s/ John Gorzkowski
|
By: | /s/ William F. Griffin, Jr.
Manager |
(Seal) | |||||||
WITNESS/ATTEST: | GEMMA POWER HARTFORD, LLC | |||||||||
/s/ John Gorzkowski
|
By: | /s/ William F. Griffin, Jr.
Manager |
(Seal) |
Signature Page to Fifth Amended and Restated Revolving Credit Note