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EXHIBIT 10.97
SIXTH AMENDED AND RESTATED
REVOLVING PROMISSORY NOTE
$6,500,000 McLean, Virginia
As of December 20, 1999
FOR VALUE RECEIVED, VERSAR, INC., a corporation organized under the laws
of the State of Delaware ("Versar"), GEOMET TECHNOLOGIES, INC., a corporation
organized under the laws of the State of Delaware ("Geomet"), SMC MCEVER, INC.,
a corporation organized under the laws of the State of Texas, SMC ENVIRONMENTAL
SERVICES GROUP, INC., a corporation organized under the laws of the State of
Pennsylvania, VERSAR ACQUISITION II, CORP., a corporation organized under the
laws of the Commonwealth of Virginia (the "Borrowers", and each individually, a
"Borrower"), jointly and severally, 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 SIX MILLION FIVE HUNDRED THOUSAND DOLLARS
($6,500,000) (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 the Financing Agreement (as hereinafter defined),
together with interest thereon at the rate or rates hereinafter provided, in
accordance with the following:
I . INTEREST. (a) Except as otherwise expressly set forth below, amounts
outstanding hereunder shall bear interest from the date until repaid in full at
the LIBOR Rate (as hereinafter defined), plus two hundred and fifty basis points
(i.e. 2.50%). For purposes hereof,
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the "LIBOR Rate" shall mean a fluctuating rate equal to the daily London
Interbank Offered Rate for thirty (30) days U.S. Dollar deposits as quoted by
the Lender as of 11:00 A.M. (Washington, D.C., time) (the "LIBOR Rate"). The
interest rate on all sums accruing interest at the LIBOR Rate under this Note
shall change immediately and contemporaneously with any change in the LIBOR
Rate.
(b) In addition, so long as no event of default or any act, event
or condition which, with notice or the passage of time or both, would constitute
an event of default under any Financing Document has occurred and is continuing,
the Borrowers shall have the right to elect that specified amounts advanced
under this Note in a minimum amount of $100,000 and increments of $50,000, bear
interest at the Prime Rate (as hereinafter defined). For purposes hereof, the
"Prime Rate" means the fluctuating prime rate of interest established and
declared by the Lender from time to time. The Prime Rate does not necessarily
represent the lowest rate of interest charged by the Lender to its borrowers.
(c) 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.
(d) In respect to any interest rate election hereunder and any
transactions contemplated hereby, the Borrowers authorize the Lender to accept,
rely upon, act upon and comply with, any verbal or written instructions,
requests, confirmations and orders of the President and Chief Executive Officer,
the Vice President, Treasurer & Chief Financial Officer and Vice President,
Secretary & General Counsel on behalf of the Borrowers. The Borrowers
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acknowledge that the transmission between the Borrowers and the Lender of any
such instructions, requests, confirmations and orders involves the possibility
of errors, omissions, mistakes and discrepancies and agrees to adopt such
internal measures and operational procedures to protect its interests. By reason
thereof, the Borrowers hereby assume all risk of loss and responsibility for,
release and discharge the Lender from any and all responsibility or liability
for, and agree to indemnify, reimburse on demand and hold the Lender harmless
from, any and all claims, actions, damages, losses, liability and expenses by
reason of, arising out of or in any way connected with or related to, (i) the
Lender's acceptance, reliance and actions upon, compliance with or observation
of any such instructions, requests, confirmations or orders, and (ii) any such
errors, omissions, mistakes and discrepancies, except those caused by the
Lender's gross negligence or willful misconduct.
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 January 1, 2000, and on the same 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
November 30, 2001.
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
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Agreement, and the balance may be increased to the Principal Sum after
any such reduction to zero.
3. DEFAULT INTEREST. Upon the occurrence of an Event of Default (as
hereinafter defined), the unpaid Principal Sum shall bear interest thereafter at
a rate (the "Default Rate") four percent (4%) per annum in excess of the Prime
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 ten (10) 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 any late charge then due
hereunder, second 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 McLean, Virginia 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. The Lender is authorized to deduct any payment
(including payments of principal and/or interest as above provided) from the
Borrowers' Account Number 4113103748 on or after the date the payment is due;
provided, however, that such authorization shall not be deemed to relieve the
Borrowers from their obligation to make such payment when it is due.
6. PREPAYMENT. The Borrowers may prepay the Principal Sum in whole or
in part
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without premium or penalty.
7. FINANCING AGREEMENT AND OTHER FINANCING DOCUMENTS. This Note is
the "Restated Note" described in that certain Eighth Amendment to Financing and
Security Agreement of even date herewith by and among the Borrowers and the
Lender, which Eighth Amendment to Financing and Security Agreement, further
amends that certain Financing and Security Agreement dated March 31, 1997 (the
"Original Financing Agreement") by and among Versar and Geomet. The Original
Financing Agreement as thereafter amended, modified, restated, substituted,
extended and renewed at any time and from time to time, is hereinafter called
the "Financing Agreement". The indebtedness evidenced by this Note is included
within the meaning of the term "Obligations" as defined in the Financing
Agreement. This Note amends and restates in its entirety that certain Fifth
Amended and Restated Revolving Promissory Note in the maximum principal amount
of Six Million Five Hundred Thousand Dollars ($6,500,000) dated May _, 1999 (the
"Prior Note") from the Borrowers in favor of the Lender. The term "Financing
Documents" as used in this Note, shall mean collectively this Note, each
Acquisition Note, the Financing Agreement and any other instrument, agreement,
or document previously, simultaneously, or hereafter executed and delivered by
any of the Borrowers and/or any other person, singularly or jointly with any
other person, evidencing, securing, guaranteeing, or in connection with the
Principal Sum, this Note and/or the Financing Agreement. It is expressly
understood and agreed that the indebtedness evidenced by the Prior Note has not
been extinguished or discharged hereby. The Borrowers and the Lender agree that
the execution of
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this Note is not intended and shall not cause or result in a novation with
regard to the Prior Note.
8. SECURITY. This Note is secured as provided in the Financing
Agreement.
9. 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 the Borrowers to pay to the Lender within five
(5) days of when due any and all amounts payable by the Borrowers 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.
10. 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 joint and
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several liability of the Borrowers, guarantors and endorsers.
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 other to any 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.
The Borrowers further agree that, if any payment made by the Borrowers,
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, their estate, trustee, receiver or any other party, including, without
limitation, such
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Borrower, under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or repayment, such
Borrower's 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 the
Borrower's 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 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.
11. EXPENSES. The Borrowers jointly and severally promise 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.
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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 11.01 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.
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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.
16. APPLICABLE LAW. Each Borrower acknowledges and agrees that this
Note shall be governed by the laws of the Commonwealth of Virginia, even though
for the convenience and at the request of the Borrowers, this Note may be
executed elsewhere.
17. WAIVER OF TRIAL BY JURY. EACH BORROWER HEREBY WAIVES TRIAL BY JURY
IN ANY ACTION OR PROCEEDING TO WHICH EITHER 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
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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 IT HAS HAD THE OPPORTUNITY TO DISCUSS THIS WAIVER WITH COUNSEL.
18. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES
HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF THIS NOTE 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 ARBITRATION OF
COMMERCIAL DISPUTES OF ENDISPUTE, INC., D/B/A J.A.M.S./ENDISPUTE ("J.A.M.S.")
AND THE "SPECIAL RULES" SET FORTH BELOW. IN THE EVENT OF AN 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 ANY
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ACTION, INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF
ANY CONTROVERSY OR CLAIM TO WHICH THIS NOTE RELATES IN ANY COURT HAVING
JURISDICTION OVER SUCH ACTION.
(A) SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN FAIRFAX
COUNTY, VIRGINIA 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 NINETY (90) DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCING OF SUCH HEARING FOR AN ADDITIONAL SIXTY (60) DAYS.
(B) RESERVATION OF RIGHTS. NOTHING IN THIS NOTE 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 THE LENDER OF THE PROTECTION AFFORDED TO IT BY 12 U.S.C.
Section 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE RIGHT
OF THE LENDER: (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED TO)
SET OFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL,
OR
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(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. THE LENDER 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 THE EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF ANY ACTION FOR FORECLOSURE OR FOR
PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY
PARTY, INCLUDING THE CLAIMANT IN SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
[SIGNATURES BEGIN ON THE FOLLOWING PAGE]
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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: VERSAR, INC.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- --------------------------
Name: Lawrence W. Sinnott
Title: Sr. VP & CFO
WITNESS/ATTEST: GEOMET TECHNOLOGIES, INC.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- ---------------------------
Name: Lawrence W. Sinnott
Title: Treasurer
WITNESS/ATTEST: SMC ENVIRONMENTAL SERVICES GROUP, INC.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- ---------------------------
Name: Lawrence W. Sinnott
Title: Treasurer
WITNESS/ATTEST: SMC MCEVER, INC.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- ---------------------------
Name: Lawrence W. Sinnott
Title: Treasurer
WITNESS/ATTEST: VERSAR ACQUISITION II, CORP.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- ----------------------------
Name: Lawrence W. Sinnott
Title: Treasurer
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WITNESS/ATTEST: GREENWOOD PARTNERSHIP, LTD.
/S/ Lula Fasold By: /S/ Lawrence W. Sinnott (SEAL)
------------------------- ----------------------------
Name: Lawrence W. Sinnott
Title: Treasurer
38
