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Title: |
Credit Agreement |
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Date: |
2004 |
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Size: |
Preview shows 16KB of 157KB total |
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Price: |
$69 |
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ID: |
#588756 |
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CREDIT AGREEMENT
BY AND BETWEEN
COMERICA BANK ("Bank")
AND
ENGLOBAL CORPORATION
ENGlobal Corporate Services, Inc.,
Thermaire, Inc.
ENGlobal Engineering, Inc.
ENGlobal Construction Resources, Inc.
ENGlobal Systems, Inc.
RPM Engineering, Inc.
ENGlobal Technologies, Inc.
ENGlobal Constant Power, Inc.
Senftleber & Associates, L.P.
ENGlobal Design Group, Inc.,
(collectively, "Borrower")
Dated July 27, 2004
{PAGE}
INDEX
Page
----
SECTION 1. DEFINITIONS....................................................1
1.1 Defined Terms.......................................................1
1.2 Accounting Terms....................................................1
1.3 Singular and Plural.................................................1
SECTION 2. TERMS, CONDITIONS AND PROCEDURES FOR BORROWING.................1
SECTION 3. REPRESENTATIONS AND WARRANTIES.................................2
3.1 Authority...........................................................2
3.2 Due Authorization...................................................2
3.3 Title to Property...................................................2
3.4 Encumbrances........................................................2
3.5 Subsidiaries........................................................2
3.6 Taxes...............................................................2
3.7 No-Defaults.........................................................2
3.8 Enforceability of Agreement and Loan Documents......................2
3.9 Non-contravention...................................................3
3.10 Actions, Suits, Litigation or Proceedings..........................3
3.11 Compliance with Laws...............................................3
3.12 Consents, Approvals and Filings....................................3
3.13 Contracts, Agreements and Leases...................................3
3.14 ERISA..............................................................3
3.15 No Investment Company..............................................3
3.16 No Margin Stock....................................................4
3.17 Environmental Representations......................................4
3.18 Accuracy of Information............................................5
3.19 Reserved...........................................................5
3.20 Intellectual Property..............................................5
SECTION 4. AFFIRMATIVE COVENANTS..........................................5
4.1 Preservation of Existence...........................................5
4.2 Keeping of Books....................................................5
4.3 Reporting Requirements..............................................6
4.4 Financial Covenants.................................................7
(a) Debt to Capitalization Ratio.....................................7
(b) Minimum Net Worth................................................7
(c) Maximum Leverage Ratio...........................................7
(d) Asset Coverage Ratio.............................................8
4.5 Inspections.........................................................8
4.6 Further Assurances; Financing Statements............................8
4.7 Compliance with Leases..............................................8
4.8 Indemnification.....................................................8
4.9 Governmental and Other Approvals....................................9
4.10 Insurance..........................................................9
4.11 Compliance with ERISA..............................................9
4.12 Environmental Covenants............................................9
4.13 Reserved..........................................................10
4.14 Reserved..........................................................10
4.15 Registration of Intellectual Property Rights......................10
4.16 Intellectual Property.............................................11
SECTION 5. NEGATIVE COVENANTS............................................11
5.1 Capital Structure, Business Objects or Purpose.....................11
5.2 Dispositions.......................................................11
5.3 Guaranties.........................................................11
5.4 Debt...............................................................11
5.5 Encumbrances.......................................................12
i
{PAGE}
5.6 Merger; Acquisitions...............................................11
5.7 Dividends..........................................................12
5.8 Investments........................................................12
5.9 Transactions with Affiliates.......................................12
5.10 Defaults on Other Obligations.....................................12
5.11 Prepayment of Debt................................................12
5.12 Pension Plans.....................................................12
5.13 Subordinate Indebtedness..........................................12
5.14 No Further Negative Pledges.......................................12
5.15 Accounts Receivable...............................................13
5.16 No License Restrictions...........................................13
5.17 Acquire Fixed Assets..............................................13
5.18 Reserved..........................................................13
SECTION 6. EVENTS OF DEFAULT.............................................13
6.1 Events of Default..................................................13
6.2 Remedies Upon Event of Default.....................................14
6.3 Setoff.............................................................15
6.4 Waiver of Certain Laws.............................................15
6.5 Waiver of Defaults.................................................15
6.6 Receiver...........................................................15
6.7 Discretionary Credit and Credit Payable Upon Demand................16
6.8 Application of Proceeds of Collateral..............................16
SECTION 7. MISCELLANEOUS.................................................16
7.1 Accounting Principles..............................................16
7.2 Taxes and Fees.....................................................16
7.3 Governing Law......................................................16
7.4 Audits of Collateral; Fees.........................................16
7.5 Costs and Expenses.................................................17
7.6 Notices............................................................17
7.7 Further Action.....................................................17
7.8 Successors and Assigns; Participation..............................17
7.9 Indulgence.........................................................17
7.10 Amendment and Waiver..............................................18
7.11 Severability......................................................18
7.12 Headings and Construction of Terms................................18
7.13 Independence of Covenants.........................................18
7.14 Reliance on and Survival of Various Provisions....................18
7.15 Effective Upon Execution..........................................18
7.16 Complete Agreement; Conflicts.....................................18
7.17 Exhibits and Addenda..............................................18
7.18 Separate Loans....................................................19
7.19 WAIVER OF JURY TRIAL..............................................19
7.20 ORAL AGREEMENTS INEFFECTIVE.......................................19
ADDENDA:
Defined Terms Addendum
Loan Terms, Conditions and Procedures Addendum
EXHIBITS:
Exhibit A - Description of Property
Exhibit B - Form of Compliance Certificate
Exhibit C - Form of Request for Advance
ii
{PAGE}
SCHEDULES:
Schedule 3.5 Subsidiaries
Schedule 3.14 Employee Benefit Plans
Schedule 3.17 Environmental Disclosures
Schedule 3.20 Intellectual Property
Schedule 5.4 Debt
Schedule 5.5 Liens
iii
{PAGE}
CREDIT AGREEMENT
----------------
THIS CREDIT AGREEMENT (this "Agreement") is made and delivered effective as
of the 27th day of July 2004, by and between ENGlobal Corporation, a Nevada
corporation; ENGlobal Corporate Services, Inc., a Texas corporation; Thermaire,
Inc., a Texas corporation; ENGlobal Engineering, Inc., a Texas corporation;
ENGlobal Construction Resources, Inc., a Texas corporation; ENGlobal Systems,
Inc., a Texas corporation; RPM Engineering, Inc., a Louisiana corporation;
ENGlobal Technologies, Inc., a Texas corporation; ENGlobal Constant Power, Inc.,
a Texas corporation; Senftleber & Associates, L.P., a Texas limited partnership;
and ENGlobal Design Group, Inc., a Texas corporation (collectively, "Borrower"),
and COMERICA BANK ("Bank").
RECITALS
--------
A. Borrower desires to obtain certain facilities from the Bank, and the
Bank is willing to provide such credit facilities to and in favor of Borrower.
B. Such credit facilities are subject to the terms and conditions set forth
herein and in every other Loan Document.
C. Such credit facilities and extensions of credit are made available to
Borrower by Bank subject to the terms and conditions set forth herein and in
every other Loan Document.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the premises and the mutual promises
herein contained, Borrower and Bank agree as follows:
SECTION 1. DEFINITIONS
1.1 Defined Terms. The terms as used in this Agreement shall have the
meanings assigned to such terms in the Defined Terms Addendum.
1.2 Accounting Terms. All accounting terms not specifically defined in this
Agreement shall be determined and construed in accordance with GAAP.
1.3 Singular and Plural. Where the context herein requires, the singular
number shall be deemed to include the plural, the masculine gender shall include
the feminine and neuter genders, and vice versa.
SECTION 2. TERMS, CONDITIONS AND PROCEDURES FOR BORROWING
Subject to the terms, conditions and procedures of this Agreement and each
other Loan Document including, but not limited to, the terms, conditions and
procedures set forth in the Defined Terms Addendum and Loan Terms, Conditions
and Procedures Addendum, Bank agrees to make credit available to the Borrower on
such dates and in such amounts as the Borrower shall request from time to time
or as may otherwise be agreed to by Borrower and Bank.
1
{PAGE}
SECTION 3. REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants, and such representations and warranties
shall be deemed to be continuing representations and warranties during the
entire life of this Agreement, and so long as Bank shall have any commitment or
obligation to make any Loans or issue any Letters of Credit hereunder, and so
long as any Indebtedness remains unpaid and outstanding under any Loan Document,
as follows:
3.1 Authority. Borrower is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its organization and
is duly qualified and authorized to do business in each other jurisdiction in
which the character of its assets or the nature of its business makes such
qualification necessary.
3.2 Due Authorization. Each Loan Party has all requisite power and
authority to execute, deliver and perform its obligations under each Loan
Document to which it is a party or is otherwise bound, all of which have been
duly authorized by all necessary action, and are not in contravention of law or
the terms of any Loan Party's organizational or other governing documents.
3.3 Title to Property. Each Loan Party has good title to all property and
assets purported to be owned by it, including those assets identified on the
Financial Statements most recently delivered by Borrower to Bank.
3.4 Encumbrances. There are no security interests or other Liens or
encumbrances on, and no financing statements on file with respect to, any of the
property or assets of any Loan Party, except for Permitted Encumbrances.
3.5 Subsidiaries. Borrower has no Subsidiaries, except as set forth in
Schedule 3.5 which Schedule sets forth the percentage of ownership of Borrower
in each such Subsidiary as of the date of this Agreement.
3.6 Taxes. Each Loan Party has filed, on or before their respective due
dates, all federal, state, local and foreign tax returns which are required to
be filed, or has obtained extensions for filing such tax returns, and is not
delinquent in filing such returns in accordance with such extensions, and has
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