BOC Boston Omaha Corporation

BOSTON OMAHA CORPORATION
(Exact name of registrant as specified in its Charter)
Delaware	001-38113	27-0788438
(State or other jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification Number)
1601 Dodge Street, Suite 3300 Omaha, Nebraska 68102 (Address and telephone number of principal executive offices, including zip code)
(857) 256-0079 (Registrant's telephone number, including area code)
Not Applicable (Former name or address, if changed since last report)

Title of Class	Trading Symbol	Name of Exchange on Which Registered
Class A common stock, $0.001 par value per share	BOC	The New York Stock Exchange

ITEM 1.01

ENTRY INTO A DEFINITIVE MATERIAL AGREEMENT

ITEM 2.03

CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT

ITEM 5.02

DEPARTURE OF DIRECTORS OR PRINCIPAL OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF PRINCIPAL OFFICERS

ITEM 5.03

AMENDMENT TO ARTICLES OF INCORPORATION OR BYLAWS; CHANGE IN FISCAL YEAR

ITEM 5.07

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Nominee	Votes Cast For	Votes Withheld	Broker Non-Votes
Bradford B. Briner	24,988,019	1,477,000	3,874,122
Tom Burt	26,275,377	189,642	3,874,122
Brendan J. Keating	26,147,798	317,221	3,874,122
Frank H. Kenan II	22,738,907	3,726,112	3,874,122
Jeffrey C. Royal	22,818,368	3,646,651	3,874,122
Vishnu Srinivasan	20,453,617	6,011,402	3,874,122

Votes Cast For	Votes Cast Against	Number of Abstentions	Broker Non-Votes
30,296,196	28,168	14,777	3,874,102

Votes Cast For	Votes Cast Against	Number of Abstentions	Broker Non-Votes
26,052,889	273,475	138,655	3,874,102

Votes Cast For One Year	Votes Cast For Two Years	Votes Cast For Three Years	Number of Abstentions	Broker Non-Votes
24,339,496	543,137	1,425,727	156,659	3,874,122

Votes Cast For	Votes Cast Against	Number of Abstentions	Broker Non-Votes
23,241,175	3,029,019	194,825	3,874,122

ITEM 9.01

FINANCIAL STATEMENTS AND EXHIBITS

(d)	Exhibits. The Exhibit Index set forth below is incorporated herein by reference.

Exhibit Number	Exhibit Title
3.1	Certificate of Amendment of the Amended and Restated Certificate of Incorporation of Boston Omaha Corporation, as Amended, with respect to officer exculpation (filed herewith).
10.1	Credit Agreement, dated September 17, 2024, by and among FIF AireBeam LLC, FIF St. George, LLC, FIF Utah LLC, and First National Bank of Omaha.
10.2	Form of Term Loan Note to be issued by FIF AireBeam LLC, FIF St. George, LLC and FIF Utah LLC to First National Bank of Omaha.
10.3	Security Agreement, dated September 17, 2024, by and among FIF AireBeam LLC, FIF St. George, LLC, FIF Utah LLC and Boston Omaha Broadband, LLC in Favor of First National Bank of Omaha.
10.4	Guaranty, dated September 17, 2024, by Boston Omaha Broadband, LLC in Favor of First National Bank of Omaha.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

	BOSTON OMAHA CORPORATION (Registrant)
	By:	/s/ Joshua P. Weisenburger
		Joshua P. Weisenburger,
		Chief Financial Officer

Exhibit 3.1

 

CERTIFICATE OF AMENDMENT

 

TO

 

SECOND AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

 

OF

 

BOSTON OMAHA CORPORATION

 

* * * * * *

 

(Pursuant to Section 242 of the
General Corporation Law of the State of Delaware)

 

Boston Omaha Corporation, a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”).

 

DOES HEREBY CERTIFY:

 

1.    The present name of the corporation is Boston Omaha Corporation (hereinafter called the “Corporation”).

 

2.    The Corporation was originally incorporated by filing its Certificate of Incorporation pursuant to the General Corporation Law on March 16, 2015, and the Corporation filed an Amended and Restated Certificate of Incorporation in the office of the Secretary of the State of Delaware on June 18, 2015, and was further amended by filing that certain Certificate of Amendment to the Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware on October 19, 2015 and that certain Second Certificate of Amendment to the Amended and Restated Certificate of Incorporation with the Secretary of State of Delaware on March 11, 2016, and filed a Second Amended and Restated Certificate of Incorporation in the office of the Secretary of the State of Delaware on May 25, 2017, and filed a Certificate of Amendment to Second Amended and Restated Certificate of Incorporation in the office of the Secretary of the State of Delaware on May 4, 2018, and filed a Certificate of Amendment to Second Amended and Restated Certificate of Incorporation in the office of the Secretary of the State of Delaware on June 2, 2020 (collectively, the “Certificate of Incorporation”).

 

3.    The amendment to the Certificate of Incorporation set forth below was duly adopted in accordance with the provisions of Section 242 of the General Corporation Law by (i) unanimous written consent of the Board of Directors of the Corporation, who declared such amendment advisable, and (ii) vote of a majority of the outstanding shares of each of the Class A Common Stock, par value $0.001 per share of the Corporation and the Class B Common Stock, par value $0.001 per share of the Corporation, which represents a majority of the outstanding voting power of all classes and series of capital stock of the Corporation entitled to vote on the matters set forth herein.

 

4.    That the Certificate of Incorporation be amended by inserting a new Article XIII immediately following Article XII, which shall read in its entirety as follows:

 

“ARTICLE XIII: MATTERS RELATING TO OFFICERS

 

To the fullest extent permitted by law, an officer of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as an officer; provided, however, that the foregoing shall not eliminate or limit the liability of an officer (i) for any breach of the officer’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) for any transaction from which the officer derived an improper personal benefit, or (iv) in any action by or in the right of the Corporation. If the General Corporation Law of the State of Delaware is hereafter amended to permit further elimination or limitation of the personal liability of officers, then the liability of an officer of the Corporation shall be eliminated or limited to the fullest extent permitted by the General Corporation Law of the State of Delaware as so amended.

 

Any repeal or modification of this ARTICLE XIII, or the adoption of any provision of this Amended and Restated Certificate of Incorporation, as amended, inconsistent with this ARTICLE XIII by the stockholders of the Corporation or otherwise shall not adversely affect any right or protection of an officer of the Corporation existing at the time of such repeal, modification or adoption of an inconsistent provision.”

 

[The remainder of this page is intentionally left blank.]

 

 

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation to be signed by a duly authorized officer this 23rd day of September, 2024.

 

BOSTON OMAHA CORPORATION     By: /s/ Adam K. Peterson                   Name: Adam K. Peterson Title:   Chief Executive Officer

 

Exhibit 10.1

 

CREDIT AGREEMENT

 

THIS CREDIT AGREEMENT, dated as of September 17, 2024 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, this “Agreement”), is among FIF AIREBEAM LLC, a Delaware limited liability company, FIF ST. GEORGE, LLC (d/b/a InfoWest), a Delaware limited liability company, and FIF UTAH LLC (d/b/a Utah Broadband), a Delaware limited liability company (whether, one or more, individually and collectively, the “Borrower”), and FIRST NATIONAL BANK OF OMAHA, a national banking association (the “Lender”).

 

The parties hereto agree as follows:

 

1.    Defined Terms.

 

(a)    All terms used herein and defined in the UCC (as defined below) shall have the meanings given to such terms therein unless otherwise defined herein. As used in this Agreement, the following terms have the meanings specified below:

 

“Affiliate” as to any Person, means any other Person that, directly or indirectly through one or more intermediaries, is in control of, is controlled by, or is under common control with, such Person. For purposes of this definition, “control” of a Person means the power, directly or indirectly, either to (a) vote 10% or more of the Equity Interests having ordinary voting power for the election of directors (or persons performing similar functions) of such Person or (b) direct or cause the direction of the management and policies of such Person, whether by contract or otherwise.

 

“Adjustment Date” means the Closing Date, and thereafter the first (1^st) day of each succeeding calendar month for each succeeding Interest Period.

 

“Agreement” has the meaning assigned to such term in the introductory paragraph of this Agreement.

 

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Affiliates from time to time concerning or relating to bribery or corruption, including, without limitation, the FCPA.

 

“Anti‑Terrorism Laws” means any laws relating to terrorism, import/export licensing, or money laundering, all as amended, supplemented or replaced from time to time.

 

“Applicable Margin” means (a) 2.75% per annum with respect to any SOFR Loan, and (b) 1.75% per annum with respect to any Base Rate Loan.

 

“Authorized Officer” means the chief executive officer, chief financial officer, treasurer or controller of the Borrower.

 

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an interest period pursuant to this Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 9(d).

 

“Base Rate” means, for any day, a rate per annum equal to equal to the highest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.50% and (c) SOFR for a one month term in effect on such date.  Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

 

“Base Rate Loan” means any Loan that bears interest at a rate based on the Base Rate.

 

“Benchmark” means, initially, the Term SOFR Reference Rate; provided that if a Benchmark Transition Event has occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 9.

 

“Benchmark Replacement” means with respect to any Benchmark Transition Event, the sum of: (a) the alternate benchmark rate that has been selected by the Lender, in consultation with the Borrower giving due consideration to (x) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body, or (y) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement to the then-current Benchmark for Dollar-denominated syndicated credit facilities, and (b) the related Benchmark Replacement Adjustment; provided that if such Benchmark Replacement as so determined would be less than 0%, such Benchmark Replacement will be deemed to be 0% for the purposes of this Agreement and the other Loan Documents.

 

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Lender giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body, or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for similar Dollar-denominated credit facilities.

 

“Benchmark Replacement Date” means the earliest to occur of the following events with respect to the then-current Benchmark:

 

(1)          In the case of clause (1) or (2) of the definition of “Benchmark Transition Event”, the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or

 

 

(2)         in the case of clause (3) of the definition of “Benchmark Transition Event”, the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by or on behalf of the administrator of such Benchmark (or such component thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative or non-compliant with or non-aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks; provided that such non-representativeness, non-compliance or non-alignment will be determined by reference to the most recent statement or publication referenced in such clause (3) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

 

For the avoidance of doubt, the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

 

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

 

(1)         a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);

 

(2)         a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or

 

 

(3)         a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative or in compliance with or aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks.

 

For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

 

“Benchmark Transition Start Date” means, in the case of a Benchmark Transition Event, the earlier of (a) the applicable Benchmark Replacement Date and (b) if such Benchmark Transition Event is a public statement or publication of information of a prospective event, the 90th day prior to the expected date of such event as of such public statement or publication of information (or if the expected date of such prospective event is fewer than 90 days) after such statement or publication, the date of such statement or publication).

 

“Benchmark Unavailability Period” means, the period (if any) (a) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 9 and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 9.

 

“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation.

 

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

 

“Board” has the meaning assigned to such term in Section 10(o).

 

“BOB” means Boston Omaha Broadband, LLC, a Delaware limited liability company.

 

“Borrower” has the meaning assigned to such term in the introductory paragraph of this Agreement.

 

“Borrowing Request” means a written request by the Borrower to the Lender for the funding of a Term Loan, in the form set forth on Exhibit C attached hereto (or other form reasonably acceptable to the Lender).

 

 

“Borrowing Date” means (a) the Closing Date with respect to any Term Loan made on the Closing Date and (b) any Business Day specified in a Borrowing Request pursuant to Section 2(b) as a date on which the Borrower requests the Lender to make a Term Loan hereunder.

 

“Business Day” means a day other than a Saturday, Sunday, or other day on which commercial banks in Omaha, Nebraska are authorized or required by law to close.

 

“Capital Expenditures” with respect to any Person, means the aggregate of all expenditures by such Person for the acquisition or leasing (pursuant to a Capital Lease) of fixed or capital assets, software, or additions to equipment (including replacements, capitalized repairs, and improvements) which are required to be capitalized under GAAP on the balance sheet of such Person; provided, that the term “Capital Expenditures” shall not include (a) expenditures made in connection with the acquisition of assets to the extent financed with the trade-in amount of existing equipment solely to the extent that the gross amount of the purchase price of equipment acquired substantially contemporaneously with the actual trade-in therewith is reduced by such trade-in amount, (b) expenditures that are accounted for as capital expenditures of such Person that are actually reimbursed by a third party (other than such Person or Affiliate of such Person), and (c) leasehold improvements that are funded by the landlord of such leasehold that are accounted for as capital expenditures by such Person.

 

“Capital Lease” means any lease which has been or should be capitalized on the books of the lessee in accordance with GAAP.

 

“Capital Lease Obligations” with respect to any Person, means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as Capital Leases under GAAP on the balance sheet of such Person and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

 

“Cash Equivalents” means (a) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States, in each case maturing within one year or less from the date of acquisition thereof and (b) investments in certificates of deposit, banker’s acceptances and time deposits maturing within 180 days from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, any domestic office of any commercial bank organized under the laws of the United States or any State thereof which has a combined capital and surplus and undivided profits of not less than $500,000,000.

 

“Change in Law” means the occurrence, after the date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rules, guideline, requirement or directive (whether or not having the force of law) by any Governmental Authority; provided however, that notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines, requirements and directives thereunder, issued in connection therewith or in implementation thereof, and (ii) all requests, rules, guidelines, requirements and directives promulgated by the Lender for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law” regardless of the date enacted, adopted, issued or implemented.

 

 

“Change of Control” means (a) Parent shall cease to own, directly or indirectly, free and clear of all Liens or other encumbrances, Equity Interests representing at least 75% of the outstanding voting power and economic interests of BOB on a fully diluted basis; (b)  BOB shall cease to own, directly or indirectly, free and clear of all Liens or other encumbrances, Equity Interests representing at least 100% of the outstanding voting power and economic interests of any Borrower on a fully diluted basis; or (c) BOB or any Borrower shall cease to own, directly or indirectly, free and clear of all Liens or other encumbrances, Equity Interests representing at least 100% of the outstanding voting power and economic interests of any Material Subsidiary on a fully diluted basis.

 

“Closing Date” means the date on which the conditions specified in Section 11(a) shall have been fulfilled to the reasonable satisfaction of the Lender in all respects.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and the regulations and published interpretations thereof.

 

“Collateral” has the meaning provided in the Security Agreement.

 

“Collateral Access Agreement” means any landlord waiver, warehouse waiver, mortgagee waiver or other agreement, in form and substance reasonably satisfactory to the Lender, between the Lender and any third party (including any landlord, warehouseman, mortgagee, bailee, consignee, customs broker, or other similar Person) in possession of any Collateral or where any Collateral is located, as such waiver or other agreement may be amended, restated, or otherwise modified from time to time.

 

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

 

“Commonly Controlled Entity” means an entity, whether or not incorporated, which is under common control with the Borrower or any Guarantor within the meaning of Section 414 of the Code.

 

“Compliance Authority” means each and all of the (a) U.S. Treasury Department/Office of Foreign Assets Control, (b) U.S. Treasury Department/Financial Crimes Enforcement Network, (c) U.S. State Department/Directorate of Defense Trade Controls, (d) U.S. Commerce Department/Bureau of Industry and Security, (e) U.S. Internal Revenue Service, (f) U.S. Justice Department, and (g) U.S. Securities and Exchange Commission.

 

“Compliance Certificate” means a Compliance Certificate duly executed by an Authorized Officer of the Borrower in substantially the form of Exhibit A attached hereto.

 

 

“Conforming Changes” means, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period” or any similar or analogous definition (or the addition of a concept of “interest period”), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods and other technical, administrative or operational matters) that the Lender reasonably decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Lender in a manner substantially consistent with market practice (or, if the Lender decides that adoption of any portion of such market practice is not administratively feasible or if the Lender reasonably determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Lender decides is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

 

“Consolidated Adjusted EBITDA” means, with respect to the Borrower and its Subsidiaries for any period, Consolidated Net Income for such period plus (a) without duplication and to the extent deducted in determining Consolidated Net Income for such period, the sum of (i) Interest Expense for such period (including interest on Capital Lease Obligations), (ii) income tax expense for such period (net of tax refunds), (iii) all amounts attributable to depreciation, amortization and accretion expense for such period, (iv) any non-cash charges or losses for such period (but excluding any non-cash charge in respect of an item that was included in Consolidated Net Income in a prior period), (v) all transaction fees and expenses of the Borrower and its Subsidiaries incurred in connection with the execution and delivery of the Loan Documents and any amendments thereto provided that the amount added back to Consolidated Adjusted EBITDA pursuant to this clause (v) shall not exceed $200,000, (vi) expenses, charges and losses indemnified or reimbursed for such period or reasonably expected to be indemnified or reimbursed, (vii) any proceeds of business interruption insurance, (viii) reasonable and documented out-of-pocket transaction expenses incurred in connection with the negotiation and documentation of Permitted Acquisitions provided that the amount added back to Consolidated Adjusted EBITDA pursuant to this clause (viii) shall not exceed 5% of Consolidated Adjusted EBITDA calculated after giving effect to the amount to be added back pursuant to such clause (but subject to the limitation in this proviso), and (ix) other non-recurring cash charges and expenses that are acceptable to the Lender in its reasonable discretion, minus (b) without duplication and to the extent included in Consolidated Net Income for such period, (i) any cash payments made during such period in respect of non-cash charges described in clause (a)(iv) taken in a prior period, (ii) any extraordinary gains and any non-cash items of income for such period, and (iii) the Pro Rata Percentage of financial advisor fees, accounting fees, legal fees, administrative fees and any similar fees and out-of-pocket costs expenses of BOB for such period, all calculated in accordance with GAAP.

 

Consolidated Fixed Charge Coverage Ratio” means, for any measurement period, the ratio of the following as determined for such period: (a) the result of Consolidated Adjusted EBITDA, minus (i) Unfinanced Maintenance Capital Expenditures, minus (ii) any dividends or distributions paid by the Borrower to BOB in cash, minus (iii) the cash portion of taxes paid to (b) Debt Service Charges, all determined for the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.

 

 

“Consolidated Funded Indebtedness” means, at any date of determination, the sum (but without duplication) of all Indebtedness under clauses (i), (ii), (iii) (including any earn-out obligations, but solely to the extent such earn-out obligations remain due and payable for more than five (5) Business Days after the date it becomes due and payable pursuant to the terms thereof, and is not being contested in good faith in accordance with the terms applicable thereto), (iv), and (vi) of the definition of “Indebtedness” and guarantees in respect of such Indebtedness referred to above, in each case of the Borrower and its Subsidiaries on a consolidated basis, determined in accordance with GAAP. For avoidance of doubt, Consolidated Funded Indebtedness shall not include any Operating Lease Expense.

 

“Consolidated Net Income” for any period, means the consolidated net income (or loss) of the Borrower and its Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

 

“Consolidated Total Leverage Ratio” means, at any date, the ratio of (a) Consolidated Funded Indebtedness for such date to (b) Consolidated Adjusted EBITDA for the period of four fiscal quarters ended on or most recently prior to such date.

 

“Covered Entity” means the Borrower, its Affiliates and Subsidiaries, all guarantors (including the Guarantors), pledgors of collateral, and all owners of the foregoing.

 

“Cure Amount” has the meaning assigned to such term in Section 14.

 

“Cure Right” has the meaning assigned to such term in Section 14.

 

“Debt Service Charges” means for any measurement period, the sum (without duplication) of the following as determined for such period: (a) cash Interest Expense, plus (b) regularly scheduled payments (but no prepayments) of principal on Indebtedness (including Capital Lease Obligations), all determined for the Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP.  

 

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

 

“Default Rate” has the meaning assigned to such term in Section 3(b).

 

“Disposition” of any Person, means a sale, transfer, lease or other disposition (including pursuant to a merger and whether effected pursuant to a Division or otherwise) of any asset, including any Equity Interests of such Person.

 

“Division” means a division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws) under which the assets, liabilities and/or obligations of a Person are divided among two or more Persons, which may or may not include the Person whose assets, liabilities and/or obligations were divided and such Person may or may not survive after giving effect thereto.

 

“Dollar” and “$” mean lawful money of the United States.

 

 

“ECP” means an “eligible contract participant” as defined in Section 1(a)(18) of the Commodity Exchange Act or any regulations promulgated thereunder and the applicable rules issued by the Commodity Futures Trading Commission and/or the Securities and Exchange Commission of the United States.

 

“Environmental Laws” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters.

 

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of the Borrower or any Guarantor directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“Equity Interests” means, as to any Person, all shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust, participations, rights in or other equivalents (however designated) of such Person’s equity (however designated including, without limitation, common and preferred shares and interests), and any warrants, options or other rights entitling the holder thereof to purchase or acquire any of the foregoing.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations and published interpretations thereof.

 

“ERISA Event” means with respect to any Loan Party or any Commonly Controlled Entity, any of the following: (a) a Reportable Event; (b) the withdrawal of a Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA; (c) the complete or partial withdrawal from any Multiemployer Plan; (d) with respect to any Multiemployer Plan, the filing of a notice of “critical” status under Section 432 of the Code or Section 305 of ERISA, or the filing of a notice of insolvency or termination (or treatment of a plan amendment as termination) under Section 4041A of ERISA; (e) the filing of a notice of intent to terminate a Plan (or treatment of a plan amendment as termination) under Section 4041 of ERISA; (f) the institution of proceedings to terminate a Plan by the PBGC; (g) the failure to make any required contribution to any Plan or Multiemployer Plan when due; (h) the imposition of a Lien under Section 430(k) of the Code or Section 303(k) or 4068 of ERISA on any property (or rights to property, whether real or personal); and (i) any other event or condition that might reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan or Multiemployer Plan or for the imposition of any liability under Title IV of ERISA other than for PBGC premiums due but not delinquent.

 

“Event of Default” has the meaning assigned to such term in Section 14.

 

 

“Excluded Subsidiary” means any Subsidiary (other than a Material Subsidiary) of a Borrower that is formed for the sole purpose of receiving government funding and only owns assets financed with such funding.

 

“Excluded Swap Obligation” means, with respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the guarantee of such Loan Party of, or the grant by such Loan Party of a security interest to secure, such Swap Obligation (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an ECP at the time the guarantee of such Loan Party or the grant of such security interest becomes or would become effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such guarantee or security interest is or becomes illegal.

 

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreement entered into pursuant to Section 1471(b)(1) of the Code.

 

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

 

“Federal Funds Effective Rate” means, for any day, the greater of (a) the rate calculated by the Federal Reserve Bank of New York based on such day’s Federal funds transactions by depositary institutions (as determined in such manner as the Federal Reserve Bank of New York shall set forth on its public website from time to time) and published on the next succeeding Business Day by the Federal Reserve Bank of New York as the Federal funds effective rate and (b) 0.00%.

 

“Financial Officer” means, as to any Person, the chief executive officer, the chief financial officer of such Person or such other officer as shall be reasonably satisfactory to the Lender.

 

“GAAP” means generally accepted accounting principles, as in effect in the United States, consistently applied.

 

“Governmental Authority” means any federal, state, county or municipal governmental agency, authority, bureau, central bank, department, board, commission, officer, official, arbitrator, court, tribunal, grand jury or entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government whose consent or approval is required as a prerequisite to (i) the continued uninterrupted operation of the business of the Borrower and/or its Subsidiaries or (ii) the performance of any act or obligation or the observance of any agreement or condition of the Borrower and/or its Subsidiaries under any Loan Document.

 

“Guarantors” means, collectively, (a) BOB, (b) each wholly-owned Material Subsidiary of the Borrower and (c) each other Person that has guaranteed all or any portion of the Obligations for the benefit of the Lender.

 

 

“Guaranty” means the Guaranty, dated as of the date hereof, between BOB and the Lender.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

“Indebtedness” means (i) indebtedness or liability for borrowed money; (ii) obligations evidenced by bonds, debentures, notes, or other similar instruments; (iii) obligations for the deferred purchase price of property or services (including trade obligations which are outstanding more than ninety (90) days past the invoice date); (iv) Capital Lease Obligations; (v) current liabilities in respect of unfunded vested benefits under Plans covered by ERISA; (vi) obligations under letters of credit; (vii) obligations under acceptance facilities; (viii) all guaranties, endorsements (other than for collection or deposit in the ordinary course of business), and other contingent obligations to purchase, to provide funds for payment, to supply funds to invest in any Person or entity, or otherwise to assure a creditor against loss; (ix) obligations secured by any Liens, whether or not the obligations have been assumed and (x) obligations, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (A) any and all Swap Agreements, and (B) any and all cancellations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction.

 

“Interest Expense” means for any Person for any period, the interest expense of such Person for such period (including all imputed interest on Capital Leases).

 

“Interest Period” means, as to any Loan, the period between the Adjustment Date and the next Adjustment Date; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period, (iii) no Interest Period shall extend beyond any Maturity Date and (iv) no tenor that has been removed from this definition pursuant to Section 9 shall be available for such Loan.

 

“Latest Maturity Date” means, at any date of determination and with respect to the Term Loans, the latest Maturity Date applicable to any such Term Loans hereunder at such time.

 

“Lender” has the meaning assigned to such term in the introductory paragraph of this Agreement, and shall include its successors and permitted assigns.

 

“Lender’s Office” means the Lender’s office at 1620 Dodge Street, Stop 3306, Omaha, Nebraska 68102 or as such office or offices of the Lender or branch, subsidiary or Affiliate thereof as may be designated in writing from time to time by the Lender to the Borrower.

 

 

“Lien” means any mortgage, deed of trust, pledge, security interest, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), or preference, priority, or other security agreement, or preferential arrangement, charge, or encumbrance of any kind or nature whatsoever.

 

“Loan Documents” means this Agreement, the Security Documents, the Guaranty, and all other agreements, instruments, documents and certificates executed and delivered to, or in favor of, the Lender by or on behalf of one or more of the Borrower and the Guarantors in connection with this Agreement or the transactions contemplated hereby.

 

“Loan Parties” means, collectively, the Borrower and the Guarantors (excluding any Guarantor that is an individual).

 

“Loans” means the Term Loans.

 

“Maintenance Capital Expenditures” means, for any period, Capital Expenditures made for the purpose of maintaining, restoring, updating and refurbishing any property of a Loan Party, including Capital Expenditures for the purpose of repairing and replacing equipment, fixtures and other furnishings at such property.

 

“Material Adverse Effect” means a material adverse effect on (a) the business, assets, operations, condition (financial or otherwise) or prospects of the Loan Parties and their Subsidiaries taken as a whole, (b) the ability of any Loan Party to perform any of its obligations under the Loan Documents or (c) the validity or enforceability of any Loan Document or the rights or remedies of the Lender thereunder.

 

“Material Contract” with respect to any Person, means each contract to which such Person is a party involving aggregate consideration payable by or to such Person equal to at least the Threshold Amount annually (but excluding purchase orders issued in the ordinary course of business) or otherwise a contract under which the consequences of a default or termination would have a Material Adverse Effect.

 

“Material Indebtedness” means Indebtedness (other than the Loans) having an outstanding principal balance in excess of the Threshold Amount, or obligations in respect of one or more Swap Agreements of any one or more of the Loan Parties.

 

“Material Subsidiary” means, as of any date, any Subsidiary that, (a) as of the last date of the most recent fiscal quarter of the Borrower and Loan Parties for which financial statements have been delivered, individually or in the aggregate together with all other Material Subsidiaries, accounts for 15.00% or more of the Total Assets of the Borrowers and their Subsidiaries and 15.00% or more of the total revenue of the Borrowers and their Subsidiaries on a consolidated basis, in each case, as measured as of the last day of the most recent fiscal quarter of the Borrower for which financial statements have been delivered and (b) is not an Excluded Subsidiary.

 

“Maturity Date” means, with respect to any Term Loan, the date that is five (5) years following the Borrowing Date of such Term Loan.

 

 

“Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA, and to which any Loan Party or Commonly Controlled Entity is making, is obligated to make or has made or been obligated to make, contributions on behalf of participants who are or were employed by any of them.

 

“Net Cash Proceeds” means (a) in connection with any event described in sub-clause (a) or (b) of the definition of “Prepayment Event”, the proceeds thereof in the form of cash and Cash Equivalents (including any such proceeds actually received from deferred payments of principal pursuant to a note, a receivable, or otherwise), net of attorneys' fees, accountants' fees, investment banking fees, amounts required to be reserved for indemnification, adjustment of purchase price, or similar obligations pursuant to the agreements governing such Prepayment Event, and net of taxes paid as a result thereof and (b) in connection with any event described in sub-clause (c) or (d) of the definition of “Prepayment Event”, the cash proceeds received from such issuance or incurrence, net of attorneys' fees, investment banking fees, accountants' fees, underwriting discounts and commissions, and other customary fees and expenses actually incurred in connection therewith.

 

“Obligations” means (i) all unpaid principal of and accrued and unpaid interest on the Loans, all accrued and unpaid fees and all expenses, reimbursements, indemnities, liabilities and other obligations and indebtedness of any of the Borrower or any Guarantor to the Lender or any indemnified party, individually or collectively, arising or incurred under any Loan Document and (ii) all other Obligations (including Swap Agreement Obligations) of any Loan Party existing on the Closing Date or arising thereafter, and including, without limitation, interest and fees and expenses, whether incurred prior to, or after the commencement of, any insolvency, bankruptcy or other similar proceeding, and whether or not allowed or allowable in any such insolvency, bankruptcy or similar proceeding; provided, however, that the definition of “Obligations” shall not create any guarantee by any Loan Party of (or grant of security interest by any Loan Party to support, as applicable) any Excluded Swap Obligations of such Loan Party for purposes of determining any obligations of any Loan Party.

 

“OFAC” means the Office of Foreign Asset Control of the Department of Treasury of the United States.

 

“Operating Lease Expense” means, with reference to any period, the aggregate cash rental expense payable by any Loan Party or its Subsidiaries under any operating leases net of any rental income received by such Loan Party or its Subsidiaries during such period, in respect of all operating leases for real or personal property as determined in accordance with GAAP, calculated for each Loan Party and its Subsidiaries on a consolidated basis for such period in accordance with GAAP.

 

“Parent” means Boston Omaha Corporation.

 

“Participant Register” has the meaning assigned to such term in Section 15(f).

 

“Pass-Through Tax Liabilities” means the amount of state and federal income tax paid or to be paid by the owner of any Equity Interests in the Loan Parties on taxable income earned by the Loan Parties and their Subsidiaries and attributable to such owner as a result of Borrower’s or BOB’s “pass-through” tax status, assuming the highest marginal income tax rate for federal and state (for the state or states in which any equity owner is liable for income taxes with respect to such income) income tax purposes, after taking into account any deduction for state income taxes in calculating the federal income tax liability and all other deductions, credits, deferrals and other reductions available to such owners from or through the Loan Parties.

 

 

“PBGC” means the Pension Benefit Guaranty Corporation or any entity succeeding to any or all of its functions under ERISA.

 

“Permitted Acquisition” means an acquisition by a Loan Party of (a) all or substantially all of the business and assets or not less than a majority of the outstanding Equity Interests of any Person that is incorporated, formed or organized in the United States, (b) a Person that is incorporated, formed or organized in the United States by a merger, amalgamation or consolidation or any other combination with such Person, or (c) any division, line of business or other business unit of a Person that is incorporated, formed or organized in the United States, so long as: (i) the acquisition relates to a business (or assets used in a type of business) predominantly in such Loan Party’s existing lines of business or businesses reasonably related thereto or reasonable extensions thereof; (ii) Borrower shall have delivered to the Lender a certificate certifying that at the time of and immediately after giving effect to such acquisition, (1) no Default or Event of Default has occurred and is continuing or would result therefrom, and (2) Borrower shall be in compliance with the covenants set forth in Section 13(j) hereof and Borrower shall have provided evidence of such compliance to the Lender on a pro forma combined basis; (iii) such acquisition does not result in any material change in the management of such Loan Party; (iv) all documents relating to the Permitted Acquisition have been provided to the Lender not later than thirty (30) days after the Permitted Acquisition (or such later time as to which the Lender may agree); (v) if a new Subsidiary is formed or acquired as a result of or in connection with the Permitted Acquisition (other than a Subsidiary that does not meet the definition of Material Subsidiary), Borrower shall have complied with the requirements of Section 12(i) in connection therewith, (vi) the Permitted Acquisition is not “hostile”; and (vii) the aggregate amount of the consideration paid with respect to all Permitted Acquisitions during the term of this Agreement shall not exceed $5,000,000.

 

“Permitted Encumbrances” means (a) Liens imposed by law for taxes that are not yet due or are being contested in compliance with Section 12(f), (b) Liens imposed by law, arising in the ordinary course of business and securing obligations that are not overdue by more than thirty (30) days or are being contested in compliance with Section 12(f), (c) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations, (d) judgment Liens in respect of judgments that do not constitute an Event of Default under Section 14(g), (e) encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property, (f) Liens (including deposits) to secure the performance of bids, tenders, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds, and other obligations of like nature, in each case in the ordinary course of business, (g) Liens arising from precautionary Uniform Commercial Code financing statement filings solely as a precautionary measure in connection with operating leases or consignment of goods, (h) mechanics’, workmen’s, materialmen’s, landlords’, carriers’, or other similar Liens arising in the ordinary course of business with respect to obligations which are not more than thirty (30) days past due or which are being contested in good faith by appropriate proceedings which prevent enforcement of the matter under contest, and (i) bankers’ Liens, rights of setoff and other similar Liens (including under Section 4-210 of the UCC) in one or more deposit accounts maintained by any Loan Party or any of its Subsidiaries, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements.

 

 

“Person” means any individual, corporation, partnership, limited liability company, joint venture, estate, trust, unincorporated association, any other person or entity, and any federal, state, county or municipal government or any bureau, department or agency thereof and any fiduciary acting in such capacity on behalf of any of the foregoing.

 

“Plan” means any pension plan which is covered by Title IV of ERISA and in respect of which any Loan Party or a Commonly Controlled Entity is making, is obligated to make or has made or been obligated to make during any relevant period, contributions on behalf of participants who are or were employed by any of them.

 

“Prepayment Event” means (a) any sale, transfer or other disposition of any property or asset of any Loan Party or any Material Subsidiary of a Loan Party in reliance of clause (C)(4) of Section 13(c)(i) of this Agreement, (b) any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any property or asset of any Loan Party or any Material Subsidiary of a Loan Party with a fair market value immediately prior to such event equal to or greater than $1,000,000 or (c) the incurrence by any Loan Party or any Material Subsidiary of any Loan Party of any Indebtedness, other than Indebtedness permitted under Section 13(a) of this Agreement.

 

“Prime Rate” means a variable rate of interest per annum equal to the rate of interest from time to time published by the Board as the “Bank Prime Loan” rate in Federal Reserve Statistical Release H.15(519) entitled “Selected Interest Rates” or any successor publication of the Federal Reserve System reporting the Bank Prime Loan rate or its equivalent. The statistical release generally sets forth a Bank Prime Loan rate for each Business Day. The applicable Bank Prime Loan rate for any date not set forth shall be the rate set forth for the last preceding date. In the event the Board ceases to publish a Bank Prime Loan rate or its equivalent, the rate for purposes of this definition shall be a variable rate of interest per annum equal to the highest of the “prime rate”, “reference rate”, “base rate”, or other similar rate announced from time to time by any of the three largest banks (based on combined capital and surplus) headquartered in New York, New York (with the understanding that any such rate may merely be a reference rate and may not necessarily represent the lowest or best rate actually charged to any customer by any such bank).

 

“Prohibited Transaction” means any transaction set forth in Section 406 of ERISA or Section 4975 of the Code.

 

“Pro Rata Percentage” means the percentage equal to (a) the number of Borrowers and their Subsidiaries divided by (b) the number of direct or indirect Subsidiaries of BOB.

 

 

“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant guaranty or grant of the relevant security interest becomes or would become effective with respect to such Swap Obligation or such other Person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

“Reportable Compliance Event” means that any Covered Entity becomes a Sanctioned Person, or is indicted, arraigned, investigated or detained, or receives an inquiry from regulatory or law enforcement officials, in connection with any Anti‑Terrorism Law, Anti-Corruption Law, or Sanctions, or any predicate crime to any Anti‑Terrorism Law, Anti-Corruption Law, or Sanctions, or self‑discovers facts or circumstances implicating any aspect of its operations with the actual or possible violation of any Anti‑Terrorism Law, Anti-Corruption Law, or Sanctions.

 

“Reportable Event” means any of the events set forth in Section 4043 of ERISA.

 

“Restricted Payment” means (a) any dividend or other distribution by a Loan Party with respect to any shares of any class of Equity Interests of such Loan Party, or any payment on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests or any option, warrant or other right to acquire any such shares and (b) any payment or other distribution by a Loan Party with respect to Indebtedness that is subordinated in right of payment to the Obligations.

 

“Sanctioned Country” means, at any time, a country or territory that is itself the subject or target of any Sanctions (as of the Closing Date, Belarus, Cuba, Iran, North Korea, Syria, Russia, Venezuela and the Crimea, Donetsk and Luhansk regions of Ukraine).

 

“Sanctioned Person” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security Council, the European Union, any Member State of the European Union, or the United Kingdom (irrespective of its status vis-à-vis the European Union), (b) any Person operating, organized or resident in a Sanctioned Country, or (c) any Person owned or controlled by any such Person.

 

“Sanctions” means economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by OFAC or the U.S. Department of State, or (b) the United Nations Security Council, the European Union, any European Union member state, His Majesty’s Treasury of the United Kingdom or other relevant sanctions authority.

 

“Sale and Leaseback Transaction” means a transaction or series of transactions pursuant to which the Borrower or any of its Material Subsidiaries shall sell or transfer to any Person any property and, as part of the same transaction or series of transactions, the Borrower or such Material Subsidiary shall rent or lease as lessee (other than pursuant to a Capital Lease) such property or one or more properties which it intends to use for the same purpose or purposes as such property.

 

 

“Security Agreement” means the Security Agreement, dated as of the Closing Date, by and among the Lender, the Borrower and each Guarantor that is a party thereto.

 

“Security Documents” means, collectively, the Security Agreement and all other security agreements, pledge agreements, mortgages, deeds of trust, control agreements and other documents executed in connection with this Agreement that are intended to create, perfect or evidence Liens to secure the Obligations.

 

“SOFR” means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.

 

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

 

“SOFR Loan” means a Loan that bears interest at a rate based on Term SOFR.

 

“Solvent” means, in reference to any Person, (i) the fair value of the assets of such Person, at a fair valuation, will exceed its debts and liabilities, subordinated, contingent or otherwise; (ii) the present fair saleable value of the property of such Person will be greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (iii) such Person will be able to pay its debts and liabilities, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (iv) such Person will not have unreasonably small capital with which to conduct the business in which it is engaged as such business is now conducted and is proposed to be conducted after the Closing Date.

 

“Subsidiary” as to any Person, means any corporation, partnership, limited liability company, joint venture, trust, or estate of or in which more than 50% of (a) the issued and outstanding capital stock having ordinary voting power to elect a majority of the board of directors of such corporation (irrespective of whether at the time capital stock of any other class of such corporation may have voting power upon the happening of a contingency), (b) the interest in the capital or profits of such partnership, limited liability company, or joint venture or, (c) the beneficial interest in such trust or estate is at the time directly or indirectly owned or controlled through one or more intermediaries, or both, by such Person. Unless otherwise qualified, all references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.

 

“Swap Agreement” means any agreement with respect to any swap, forward, spot, future, credit default or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions.

 

“Swap Agreement Obligations” means any and all obligations of the Loan Parties, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (a) any Swap Agreement permitted hereunder with a Lender or an Affiliate of the Lender, and (b) any cancellations, buy backs, reversals, terminations or assignments of any Swap Agreement transaction permitted hereunder with the Lender or an Affiliate of the Lender.

 

 

“Swap Obligation” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act or any rules or regulations promulgated thereunder.

 

“Term Loan” has the meaning assigned to such term in Section 2(a).

 

“Term Loan Commitment” means the commitment of the Lender to make Term Loans from time to time pursuant to this Agreement. The aggregate amount of the Lender’s Term Loan Commitment shall not exceed the Term Loan Maximum Commitment Amount, and the Term Loan Commitment shall be reduced by the amount of each Term Loan funded by the Lender pursuant to this Agreement; provided, however, the Term Loan Commitment shall be increased by the principal amount of Term Loan amounts prepaid or repaid by the Borrower, but no such prepayments or repayments, in the aggregate, shall cause the Term Loan Commitment to exceed the Term Loan Maximum Commitment Amount. The Term Loan Commitment shall be reduced to $0 and permanently terminated on the Term Loan Draw Expiration Date.

 

“Term Loan Draw Expiration Date” means the earlier of (a) the date upon which the aggregate amount of the Term Loan Commitment is fully advanced pursuant to Section 2(a), and (b) September 17, 2025.

 

“Term Loan Maximum Commitment Amount” means $20,000,000.

 

“Term SOFR” means, for any calculation with respect to a SOFR Loan, the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day; provided further, if Term SOFR determined as provided above (including pursuant to the proviso above) shall ever be less than 0%, then Term SOFR shall be deemed to be 0%.

 

“Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by the Lender in its reasonable discretion).

 

 

“Term SOFR Reference Rate” means the forward-looking term rate based on SOFR.

 

“Threshold Amount” means $1,000,000.

 

“Total Assets” means on any date of determination, the total assets of the Borrowers and its Subsidiaries on a consolidated balance sheet of the Borrower and its Subsidiaries determined in accordance with GAAP.

 

“UCC” means the Uniform Commercial Code, as in effect from time to time, of the State of Nebraska or of any other state the laws of which are required as a result thereof to be applied in connection with the attachment, perfection or priority of, or remedies with respect to, Lender’s Lien on any Collateral.

 

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

 

“Unfinanced Maintenance Capital Expenditures” means any Maintenance Capital Expenditures that are not financed with proceeds of any Term Loan, with the proceeds of purchase money Indebtedness or Capital Leases to the extent permitted herein or with the proceeds of a capital contribution by Parent to BOB or to any Subsidiary.

 

“U.S. Government Securities Business Day” means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

 

“United States” means the United States of America.

 

(b)    Unless the context requires otherwise (i) any definition of or reference to any document herein shall be construed as referring to such document as from time to time amended, restated, amended and restated, supplemented or otherwise modified and (ii) any definition of or reference to any statute, rule or regulation shall be construed as referring thereto as from time to time amended, supplemented or otherwise modified (including by succession of comparable successor laws).

 

(c)    Any of the terms defined in this Section 1 or otherwise in this Agreement may, unless the context otherwise requires, be used in the singular or the plural depending on the reference. In this Agreement, words importing any gender include the other genders; the words “including,” “includes” and “include” shall be deemed to be followed by the words “without limitation”; the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or”; references to Persons include their respective permitted successors and assigns or, in the case of governmental Persons, Persons succeeding to the relevant functions of such Persons.

 

 

(d)    For purposes of this Agreement, all accounting terms not otherwise defined herein shall have the meanings assigned to such terms in conformity with GAAP. Financial statements and other information furnished to the Lender pursuant to this Agreement shall be prepared in accordance with GAAP (as in effect at the time of such preparation) on a consistent basis. In the event any change in GAAP shall occur and such changes affect financial covenants, standards or terms in this Agreement, then the Borrower and the Lender agree to enter into negotiations in order to amend such provisions of this Agreement so as to equitably reflect such change with the desired result that the criteria for evaluating the financial condition of the Borrower and its Subsidiaries shall be the same after such change as if such change had not been made, and until such time as such an amendment shall have been executed and delivered by the Borrower and the Lender, (A) all financial covenants, standards and terms in this Agreement shall be calculated and/or construed as if such change had not been occurred, and (B) the Borrower shall prepare footnotes to each Compliance Certificate and the financial statements required to be delivered hereunder that show the differences between the financial statements delivered (which reflect such change) and the basis for calculating financial covenant compliance (without reflecting such change) provided, that all obligations of any Person that are or would have been treated as operating leases for purposes of GAAP prior to the effectiveness of FASB ASC 842 shall continue to be accounted for as operating leases for purposes of all financial definitions and calculations for purposes of this Agreement (whether or not such operating lease obligations were in effect on such date) notwithstanding the fact that such obligations are required in accordance with FASB ASC 842 (on a prospective or retroactive basis or otherwise) to be capitalized in the financial statements.

 

2.    Term Loan Facilities.

 

(a)    Subject to the terms and conditions set forth herein, the Lender agrees to make Term Loans in Dollars to the Borrower, commencing on the Closing Date, and continuing through and including the Term Loan Draw Expiration Date, provided, (i) the aggregate principal amount all Terms Loans shall not exceed the Term Loan Commitment and (ii) the amount of any Term Loan shall not exceed 75% of the amount of the hard costs of the Capital Expenditures financed thereby as supported by invoices and receipts required by and delivered to the Lender and in form and substance reasonably satisfactory to the Lender; provided, further, that any request by the Borrower for a Term Loan shall be in a minimum amount of $1,000,000 and integral multiples of $100,000 in excess thereof. Each Term Loan requested, made and continued hereunder shall be a SOFR Loan, except as provided in Section 9.

 

(b)    Term Loans shall be extended upon the Borrower’s delivery to the Lender of a Borrowing Request (duly executed by an Authorized Officer of the Borrower). The Borrower shall specify in each such Borrowing Request (i) the requested Borrowing Date (which date shall be a Business Day) and (ii) the amount of such Term Loan. To request a borrowing of a Term Loan, the Borrower shall notify the Lender of such request not later than 11:00 a.m. (Central time) five (5) Business Days prior to the date of the proposed borrowing.

 

(c)    The Borrower shall repay each Term Loan on the first day of each calendar month (each, a “Payment Day”), commencing with the first Payment Day occurring after the Borrowing Date of such Term Loan, in monthly payments of (i) principal in an amount sufficient to fully amortize the unpaid principal balance of such Term Loan over an amortization period of one hundred (120) months so as to create substantially-level payments of principal, and (ii) accrued unpaid interest on the outstanding principal balance of such Term Loan at the rate set forth herein. The Borrower shall repay the outstanding principal amount of each Term Loan on the applicable Maturity Date (unless earlier prepaid).

 

 

(d)    The Borrower shall have the right at any time and from time to time to prepay the Term Loans in whole or in part, subject to prior notice in accordance with the provisions of this Section 2(d). The Borrower shall notify the Lender by telephone (confirmed by writing) of any prepayment hereunder not later than 11:00 a.m. (Central time) one (1) Business Day before the date of prepayment. Each voluntary prepayment of a Term Loan shall be applied to the remaining principal installment payments of such Term Loan in the inverse order of maturity. Each mandatory prepayment described in this Section 2 shall be applied in accordance with the terms thereof. Prepayments of the Term Loans shall be accompanied by accrued interest and any prepayment fee payable as required pursuant to Section 4(b).

 

(e)    If at any time the aggregate principal amount of all Term Loans exceeds the Maximum Term Loan Commitment Amount, the Borrower shall immediately repay Term Loans in an aggregate principal amount sufficient to cause the aggregate principal amount of all Term Loans to be less than or equal to the Maximum Term Loan Commitment Amount.

 

(f)    In the event and on each occasion that any Net Cash Proceeds are received by the Borrower or any of its Subsidiaries in respect of any Prepayment Event described in clause (b) of the definition thereof, the Borrower shall, promptly after such Net Cash Proceeds are received, prepay the Loans in an aggregate amount equal to 100% of such Net Cash Proceeds; provided however that, if within 180 days after receipt of such Net Cash Proceeds, Borrower uses such Net Cash Proceeds to replace or rebuild real property, equipment or other tangible assets (excluding inventory) to be used in the business of the Borrower and/or its Subsidiaries, then no prepayment shall be required pursuant to this Section 2(f), provided, further, that to the extent any of such Net Cash Proceeds have not been so applied by the end of such 180 day period, a prepayment shall be required at such time in an amount equal to such Net Cash Proceeds that have not been so applied. All mandatory prepayments shall be applied to prepay the Term Loans (to be applied to installments of the Term Loans in the inverse order of maturity).

 

(g)    All payments and prepayments to be made in respect of principal, interest, or other amounts due from the Borrower hereunder shall be payable at 12:00 p.m. (Central time), on the day when due, in immediately available funds, without defense, set-off or counterclaim. Any amounts received after such time on any date may, in the discretion of the Lender, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon. All payments hereunder shall be made in Dollars at the Lender’s Office or such other location as the Lender shall instruct the Borrower in writing. All payments shall be applied first to the payment of all fees, expenses and other amounts due to the Lender hereunder (excluding principal and interest), then to accrued interest hereunder to the extent such interest is then due, and the balance on account of outstanding principal hereunder.

 

(h)    The Lender shall maintain in accordance with its usual practice a loan account or accounts evidencing the indebtedness of the Borrower to the Lender resulting from the Loans, including the amounts of principal and interest payable and paid to the Lender from time to time under this Agreement. The balance in the loan accounts shall constitute presumptive evidence, absent manifest error, of the accuracy of the information contained therein; provided, however, that any failure by the Lender to so record shall not limit or affect the Borrower’s or any Guarantor’s obligation to pay the Obligations. Upon the request of the Lender, the Borrower will promptly execute and deliver to the Lender one or more notes in form and substance reasonably satisfactory to Lender evidencing the Term Loans.

 

 

3.    Interest.

 

(a)    Subject to Section 3(b) hereof, (i) Term Loans that are SOFR Loans shall bear interest on the unpaid principal amount thereof at a per annum variable rate equal to Term SOFR plus the Applicable Margin; and (ii) Term Loans that are Base Rate Loans shall bear interest on the unpaid principal amount thereof at a per annum variable rate equal to the Base Rate plus the Applicable Margin.

 

(b)    Upon the occurrence and during the continuation of an Event of Default beyond any applicable notice and cure period and at any time following the Latest Maturity Date, at the sole discretion of Lender, the outstanding principal balance of the Loans will bear interest at a per annum rate equal to 2% above the per annum rate otherwise applicable under Section 3(a) (the “Default Rate”). The Lender may assess the Default Rate commencing as of the date of the occurrence of an Event of Default or as of any date after the occurrence of an Event of Default regardless of the date of reporting or declaration of such Event of Default.

 

(c)    Accrued interest on the Loans shall be payable monthly in arrears on each Payment Day and on each Maturity Date; provided that (i) interest accrued pursuant to Section 3(b) shall be payable on demand, and (ii) in the event of any repayment or prepayment of the Term Loans, accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment.

 

(d)    All interest hereunder shall be computed on the basis of a year of 360 days, and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). Term SOFR and the Base Rate, as applicable, shall be determined by the Lender, and such determination shall be conclusive absent manifest error.

 

4.    Fees.

 

(a)    Unused Commitment Fee. From the Closing Date through and including the Term Loan Draw Expiration Date, the Borrower shall pay to the Lender a fee in an amount equal to 0.25% per annum on the unused portion of the Term Loan Commitment, which fee shall be payable quarterly in arrears on the last day of each March, June, September and December and on the Term Loan Draw Expiration Date.

 

(b)     Prepayment Fees. If (i) the Lender demands payment of a Term Loan after an Event of Default and the Borrower thereafter prepays such Term Loan, or (ii) the Borrower voluntarily prepays a Term Loan at any time prior to the Maturity Date for such Term Loan, then the Borrower will pay Lender a prepayment fee in an amount equal to a percentage of the principal amount of the Term Loan prepaid calculated as follows: (A) 4%, if the prepayment occurs on or before the first anniversary of the Borrowing Date for such Term Loan; (B) 3%, if the prepayment occurs after the first anniversary of the Borrowing Date for such Term Loan and on or before the second anniversary of the Borrowing Date for such Term Loan; (C) 2%, if the prepayment occurs after the second anniversary of the Borrowing Date for such Term Loan and on or before the third anniversary of the Borrowing Date for such Term Loan; (D) 1%, if the prepayment occurs after the third anniversary of the Borrowing Date of such Term Loan and on or before the fourth anniversary of the Borrowing Date of such Term Loan; and (E) 0%, if such prepayment occurs thereafter.

 

 

(c)    Late Fees. In the event the Borrower fails to pay any principal, interest, or other amount payable under any Loan Document within ten (10) days following the date on which the same shall become due and payable, the Borrower agrees to pay to the Lender a late fee in an amount equal to 5% of such past due amount. Such late fee shall be payable on the sixth (6^th) day (or, if such day is not a Business Day, the immediately following Business Day) following the date on which the past due amount was due and payable. For the avoidance of doubt, it is hereby understood and agreed that the payment of such late fee shall not operate as a waiver of any Default or Event of Default or waiver of any right, power or remedy of the Lender under the Loan Documents, nor constitute a waiver of any provision of any Loan Document.

 

(d)    Payment of Principal, Interest, Fees and Other Amounts. All payments of principal, interest, fees, and all other Obligations payable under the Loan Documents shall be made to the Lender via wire transfer of immediately available funds to such account as the Lender may from time to time specify to the Borrower (or in such other manner as the Lender may specify). At the sole election of the Lender, all payments of principal, interest, fees, reimbursable expenses (including, without limitation, all reimbursement for fees and expenses pursuant to Section 15(d), and other sums payable under the Loan Documents, may be paid from the proceeds of borrowings of Term Loans made hereunder or may be deducted from any deposit account of the Borrower maintains with, or the under the control of, the Lender. The Borrower hereby irrevocably authorizes the Lender to charge any deposit account of the Borrower maintained with, or under the control of, the Lender for each payment of principal, interest and fees as it becomes due hereunder or any other amount due under the Loan Documents.

 

5.    Increased Costs. If the Lender reasonably determines that the effect of any Change in Law is to reduce the amount of any payment of principal or interest receivable by the Lender thereon, then the Borrower will pay to the Lender on demand such additional amounts as the Lender may reasonably determine to be required to compensate the Lender for such additional costs or reduction. Any additional payment under this Section 5 will be computed from the Closing Date at which such additional costs have to be borne by the Lender. A certificate of the Lender as to any additional amounts payable pursuant to this Section 5 setting forth the calculation of such amounts shall be delivered to the Borrower and shall be conclusive, absent manifest error, as to the determination by the Lender set forth therein. The Borrower shall pay any amounts so certified to it by the Lender within ten (10) days after receipt of any such certificate. Failure or delay on the part of the Lender to demand compensation pursuant to the foregoing provisions of this Section 5 shall not constitute a waiver of the Lender’s right to demand such compensation.

 

6.    Compensation for Losses. In the event of (a) the payment of any principal of any SOFR Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any SOFR Loan other than on the last day of the Interest Period applicable thereto (including as a result of an Event of Default), or (c) the failure to borrow, convert, continue or prepay any SOFR Loan on the date specified in any notice delivered pursuant hereto, then, in any such event, the Borrower shall compensate the Lender for the loss, cost and expense (excluding any loss of profit) attributable to such event, including any loss, cost or expense arising from the liquidation or redeployment of funds. A certificate of the Lender setting forth any amount or amounts that the Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay the Lender the amount shown as due on any such certificate within ten (10) days after receipt thereof.

 

 

7.    Inability to Determine Rates. Subject to Section 9 below, if, on or prior to the first day of any Interest Period for any SOFR Loan, the Lender determines (which determination shall be conclusive and binding absent manifest error) that Term SOFR cannot be determined pursuant to the definition thereof, or does not adequately and fairly reflect the cost to the Lender of funding such Loan, then the Lender will promptly so notify the Borrower. Upon notice thereof by the Lender to the Borrower, any obligation of the Lender to make SOFR Loans, and any right of the Borrower to continue SOFR Loans shall be suspended to the extent of the affected SOFR Loans or affected Interest Periods. Upon receipt of such notice, the Borrower may revoke any pending request for a borrowing of, conversion to or continuation of SOFR Loans (to the extent of the affected SOFR Loans or affected Interest Periods) or, failing that, the Borrower will be deemed to have converted any such request into a request for a borrowing of or conversion to Base Rate Loans in the amount specified therein and (ii) any outstanding affected SOFR Loans will be deemed to have been converted into Base Rate Loans at the end of the applicable Interest Period. Upon any such conversion, the Borrower shall also pay accrued interest on the amount so converted, together with any additional amounts required pursuant to Section 6.

 

8.    Illegality. If the Lender determines that any law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for Lender to make, maintain or fund Loans whose interest is determined by reference to SOFR, the Term SOFR Reference Rate or Term SOFR, or to determine or charge interest rates based upon SOFR, the Term SOFR Reference Rate or Term SOFR, then, upon notice thereof by the Lender to the Borrower, any obligation of the Lender to make SOFR Loans, and any right of the Borrower to continue SOFR Loans, shall be suspended, in each case until the Lender notifies the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the Borrower shall, if necessary to avoid such illegality, upon demand from the Lender, prepay or, if applicable, convert all SOFR Loans of such Lender to Base Rate Loans, either on the last day of the Interest Period therefor, if the Lender may lawfully continue to maintain such SOFR Loans to such day, or immediately, if the Lender may not lawfully continue to maintain such SOFR Loans to such day, until it is no longer illegal for the Lender to determine or charge interest rates based upon SOFR, the Term SOFR Reference Rate or Term SOFR. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so prepaid or converted, together with any additional amounts required pursuant to Section 6.

 

9.    Benchmark Replacement Setting.

 

(a)         Benchmark Replacement. Notwithstanding anything to the contrary herein or in any other Loan Document, upon the occurrence of a Benchmark Transition Event, the Lender may amend this Agreement to replace the then-current Benchmark with a Benchmark Replacement. Any such amendment with respect to a Benchmark Transition Event will become effective at the time specified by Lender. No replacement of a Benchmark with a Benchmark Replacement pursuant to this paragraph will occur prior to the applicable Benchmark Transition Start Date. No swap agreement shall be deemed to be a “Loan Document” for purposes of this paragraph.

 

 

(b)         Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, the Lender will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

 

(c)         Notices; Standards for Decisions and Determinations. The Lender will promptly notify the Borrower of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. Lender will promptly notify Borrower of the removal or reinstatement of any tenor of a Benchmark pursuant to Section 9(d). Any determination, decision or election that may be made by the Lender pursuant to this paragraph, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this paragraph.

 

(d)         Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Reference Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by Lender in its reasonable discretion or (B) the administrator of such Benchmark or the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative or in compliance with or aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks, then the Lender may modify the definition of “Interest Period” (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable, non-representative, non-compliant or non-aligned tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative or in compliance with or aligned with the International Organization of Securities Commissions (IOSCO) Principles for Financial Benchmarks for a Benchmark (including a Benchmark Replacement), then Lender may modify the definition of “Interest Period” (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate such previously removed tenor.

 

(e)         Benchmark Unavailability Period. Upon the Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, Borrower may revoke any pending request for a SOFR Loan, or a conversion to or continuation of SOFR Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, (i) Borrower will be deemed to have converted any such request into a request for a Borrowing of or conversion to Base Rate Loans and (ii) any outstanding affected SOFR Loans will be deemed to have been converted into Base Rate Loans.

 

 

10.    Representations and Warranties. The Borrower represents and warrants to the Lender that:

 

(a)    Each Loan Party and its respective Subsidiaries (i) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation, (ii) has all requisite power and authority to carry on its business as now conducted and is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect;

 

(b)    the transactions contemplated by this Agreement are within each Loan Party’s organizational powers and have been duly authorized by all necessary organizational actions and, if required, actions by equity holders;

 

(c)    the Loan Documents to which each Loan Party is a party have been duly executed and delivered by such Loan Party and constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law;

 

(d)    the transactions contemplated by this Agreement (i) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except such as have been obtained or made and are in full force and effect and except for filings necessary to perfect Liens created pursuant to the Loan Documents, (ii) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of any Loan Party or any of its Subsidiaries or any order of any Governmental Authority, (iii) will not violate or result in a default under any indenture, agreement or other instrument binding upon any Loan Party or any of its Subsidiaries or its assets, or give rise to a right thereunder to require any payment to be made by any Loan Party or any of its Subsidiaries, in each case where such violation or default, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect, and (iv) will not result in the creation or imposition of any Lien on any asset of any Loan Party or any of its Subsidiaries, other than Liens created under the Loan Documents;

 

(e)    the annual financial statements of the Loan Parties and their Subsidiaries on a consolidated/combined basis for the Loan Parties and their Subsidiaries dated as of the most recently ended fiscal year, and all interim financial statements delivered to Lender since such date and prior to the date of this Agreement: (i) are complete and correct and present fairly, in all material respects, the financial condition of the Loan Parties and their Subsidiaries on a consolidated/combined basis, (ii) disclose all material liabilities of the Loan Parties and their Subsidiaries on a consolidated/combined basis that are required to be reflected or reserved against under GAAP, whether liquidated or unliquidated, fixed or contingent, and (iii) have been prepared in accordance with GAAP consistently applied, subject to year-end audit adjustments and the absence of footnotes in the case of the interim financial statements;

 

 

(f)    as of the date of the most recent annual financial statements delivered to the Lender, there has been no material adverse change in the business, assets, operations, condition (financial or otherwise) or prospects of the Loan Parties and their Subsidiaries, taken as a whole;

 

(g)    Schedule 10(g) hereto (as supplemented from time to time) identifies each Subsidiary, the jurisdiction of its incorporation or organization, as the case may be, the percentage of issued and outstanding shares of each class of its capital stock or other equity interests owned by the Loan Parties and their Subsidiaries;

 

(h)    each Loan Party and its Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its business, subject in each case to Permitted Encumbrances and any other Liens permitted hereunder;

 

(i)    there are no actions, suits, proceedings or investigations by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower, threatened in writing against or affecting any Loan Party or any of its Subsidiaries (i) except as set forth on Schedule 10(i), as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect or (ii) that involve this Agreement or the transactions contemplated hereby;

 

(j)    except as set forth on Schedule 10(j), none of the Loan Parties nor any of their Subsidiaries (i) to such Loan Party’s or Subsidiary’s knowledge, has failed to comply with any Environmental Law in any material respect or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability;

 

(k)    each Loan Party and its Subsidiaries is in compliance, in all material respects, with all laws, regulations and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property;

 

(l)    none of the Loan Parties nor any of their Subsidiaries is an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940;

 

(m)    no ERISA Event has occurred or could reasonably be expected to occur;

 

(n)    none of the reports, financial statements, certificates or other information furnished by or on behalf of any Loan Party or any Subsidiary to the Lender in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder contains any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

(o)    no part of the proceeds of the Loans have been used or will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board of Governors of the Federal Reserve System of the United States (the “Board”), including Regulations T, U and X;

 

 

(p)    no Default or Event of Default has occurred and is continuing;

 

(q)    each Loan Party is, individually and together with its Subsidiaries on a consolidated/combined basis, Solvent;

 

(r)    each Loan Party and its Subsidiaries has filed or caused to be filed all tax returns which are required to be filed, and has paid all taxes shown to be due and payable on said returns or on any assessments made against it or any of its property prior to the date on which any fine, penalty, interest or late charge may be added thereto for nonpayment thereof, excluding such amounts as are being contested in compliance with Section 12(f); (provided that, (i) adequate reserves with respect to such contest have been set aside on the books of such Loan Party or such Subsidiary, as applicable, in accordance with GAAP and (ii) none of the Collateral becomes subject to forfeiture or loss as a result of such contest);

 

(s)    each Loan Party and its Subsidiaries and, to the knowledge of the Borrower, their respective officers, employees, directors and agents that act in any capacity in connection with the Loans and the other transactions established hereby, are in compliance with Anti-Corruption Laws and applicable Sanctions;

 

(t)    none of (i) the Loan Parties, any Subsidiary or, to the knowledge of the Borrower, any of their respective directors, officers or employees, or (ii) to the knowledge of the Borrower, any agent of any Loan Party or any Subsidiary that acts in any capacity in connection with the Loans and any other transactions contemplated by this Agreement, is a Sanctioned Person;

 

(u)    the use of proceeds of the Loans or other transaction contemplated by this Agreement will not violate any Anti-Corruption Law or applicable Sanctions;

 

(v)    the funds used to repay the Loans are not derived from any unlawful activity;

 

(w)    each Covered Entity is in compliance with, and no Covered Entity engages in any dealings or transactions prohibited by, any laws of the United States, including but not limited to any Anti-Terrorism Laws or any Anti-Corruption Laws; and

 

(x)    as of the Closing Date, the information included in the Beneficial Ownership Certification is true and correct in all material respects.

 

11.    Conditions Precedent.

 

(a)    The obligations of the Lender to make the Loans shall not become effective until the date on which each of the following conditions is satisfied or waived by Lender: (i) the Lender shall have received (x) from each party hereto a counterpart of this Agreement signed on behalf of such party and (y) duly executed copies of all documents, instruments, certificates and information identified on the transaction checklist attached hereto as Exhibit B (including without limitation, at least five (5) Business Days prior to the Closing Date, if any Loan Party qualifies as a “legal entity customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification in relation to such Loan Party and copies of all applicable identification), all in form and substance reasonably satisfactory to the Lender in all respects; (ii) the Lender shall have received evidence satisfactory to it that any credit facility currently in effect for the Borrower (other than Indebtedness permitted by Section 13(a) hereof) shall have been terminated and cancelled and all indebtedness thereunder shall have been fully repaid (except to the extent being so repaid with the proceeds of the Loans) and any and all liens thereunder shall have been terminated; (iii) the Lender shall have received all fees and other amounts due and payable on or prior to the Closing Date; (iv) the representations and warranties of the Loan Parties set forth in the Loan Documents shall be true and correct, in all material respects, on and as of the date thereof except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties shall be true and correct, in all material respects, as of such earlier date); and (v) no Default or Event of Default shall have occurred and be continuing.

 

 

(b)    Each Borrowing. The obligation of the Lender to make a Term Loan on the occasion of any borrowing of Term Loans, is subject to the satisfaction of the following conditions: (i) the representations and warranties of the Loan Parties set forth in the Loan Documents shall be true and correct, in all material respects, on and as of the date thereof, except to the extent that such representations and warranties relate solely to an earlier date (in which case such representations and warranties shall be true and correct, in all material respects, as of such earlier date), (ii) at the time of and immediately after giving effect thereto, no Default or Event of Default shall have occurred and be continuing and (iii) the receipt by the Lender of a Borrowing Request. Each borrowing shall be deemed to constitute a representation and warranty by the Borrower on the date thereof as to the matters specified in the foregoing clauses (i) and (ii) of this Section 11(b).

 

12.    Affirmative Covenants. Until the Obligations shall have been paid in full in cash and this Agreement irrevocably terminated, the Borrower covenants and agrees with the Lender that:

 

(a)    Financial Statements and Other Information. The Borrower will furnish to the Lender:

 

(i)(A) within one hundred twenty five (125) days after the end of the fiscal year of the Loan Parties ending December 31, 2024, the audited balance sheet of the Loan Parties and their Subsidiaries on a consolidated/combined basis as of the end of and for such fiscal year; and

 

(B) within one hundred twenty five (125) days after the end of each fiscal year of the Loan Parties commencing with the fiscal year ending December 31, 2025, the audited balance sheet and related statements of operations, stockholders’ equity and cash flows of the Loan Parties and their Subsidiaries on a consolidated/combined basis as of the end of and for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year (it being acknowledged that for purposes of the fiscal year ending December 31, 2025, the statements of operations, stockholders’ equity and cash flows for the fiscal year ending December 31, 2024 for purposes of comparing the previous fiscal year shall be unaudited), all reported on by independent public accountants reasonably acceptable to the Lender (without a “going concern” or like qualification or exception and without any qualification or exception as to the scope of such audit (except for a qualification that the operations of BOB and its Subsidiaries is dependent upon the financing from Parent)) to the effect that such consolidated/combined financial statements present fairly in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a consolidated/combined basis in accordance with GAAP consistently applied;

 

 

(ii)          within fifty (50) days after the end of each fiscal quarter of each fiscal year of the Borrower, the balance sheet and related statements of operations, stockholders’ equity and cash flows of the Loan Parties and their Subsidiaries on a consolidated/combined basis as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Authorized Officer as presenting fairly in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a consolidated/combined basis in accordance with GAAP consistently applied, subject to normal year-end audit adjustments and the absence of footnotes;

 

(iii)         concurrently with any delivery of financial statements under clause (i) above and within fifty (50) days after the end of each fiscal quarter of each fiscal year of the Borrower, a Compliance Certificate (A) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with respect thereto, (B) setting forth reasonably detailed calculations demonstrating compliance with Section 13(j) and (C) stating whether any change in GAAP or in the application thereof has occurred since the date of the audited financial statements referred to in Section 12(a)(i) and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate;

 

(iv)         as soon as available, but in any event at least thirty one (31) days after the end of each fiscal year of the Borrower, an annual business plan and budget of the Borrower and its Subsidiaries on a consolidated/combined basis, including forecasts prepared by management of the Borrower, in form reasonably satisfactory to the Lender, of consolidated/combined balance sheets and statements of income or operations and cash flows of the Borrower and its Subsidiaries on a monthly basis for the following four (4) fiscal quarters; and

 

(v)         promptly following a request therefor, such other information, statements and reports respecting the condition or operations, financial or otherwise, of the Borrower or any other Loan Party as shall be reasonably requested by the Lender.

 

(b)    Notices of Material Events. The Borrower will furnish to the Lender prompt written notice of (i) the occurrence of any Default or Event of Default, (ii) receipt of any notice of any investigation by a Governmental Authority or any litigation, arbitration or proceeding commenced or threatened in writing against any Loan Party that seeks damages or asserts liability on the part of any Loan Party in excess of the Threshold Amount, (iii) any change in any Loan Party’s name as it appears in official filings in the state of its organization, (iv) the occurrence of any Reportable Compliance Event, (v) any change in the information provided in the Beneficial Ownership Certification that would result in a change to the list of beneficial owners identified in such certification, (vi) any development that results in, or could reasonably be expected to result in, a Material Adverse Effect, and (vii) any Loan Party entering into a Swap Agreement or a material amendment to a Swap Agreement, together with copies of all agreements evidencing such Swap Agreement or amendment.

 

 

(c)    Existence; Conduct of Business. The Borrower will, and will cause each Loan Party and its Subsidiaries to, do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, qualifications, licenses, permits, privileges, franchises, governmental authorizations and intellectual property rights material to the conduct of its business, and maintain all requisite authority to conduct its business in each jurisdiction in which its business is conducted, except where such failure to maintain such authority to conduct business would not reasonably be expected to result in a Material Adverse Effect.

 

(d)    Insurance. The Borrower will, and will cause each Loan Party and its Subsidiaries to, maintain insurance with responsible, reputable and financially sound insurance companies or associations reasonably acceptable to the Lender in such amounts and covering such risks as is usually carried by companies engaged in similar businesses and owning similar properties in the same general areas in which the Borrower or such Loan Party operates, and will cause all such insurance policies to contain lender loss payable endorsements, additional insured clauses and provisions regarding notice of cancelation, satisfactory to the Lender in its sole discretion. Within thirty (30) days after the stated expiration date of any insurance policy set forth on any evidence of insurance most recently provided to the Lender, the Borrower shall provide the Lender, in each case in form and substance reasonably satisfactory to the Lender, updated evidence of existing property, business interruption and liability insurance covering each Loan Party.¹

 

(e)    Maintenance of Properties; Books and Records; Maintenance of Deposit Accounts at Lender. The Borrower will, and will cause each other Loan Party and its Subsidiaries to, (i) maintain and preserve all of its properties (tangible and intangible) which are used or useful in the conduct of its business in good working order and condition, ordinary wear and tear excepted and comply with all requirements of law and all regulations applicable to the Borrower, such Loan Party or its properties, (ii) maintain accurate records and books of account, in which complete entries will be made in accordance with GAAP consistently applied, reflecting all financial transactions of the Borrower and the other Loan Parties and (iii) maintain its primary depository relationship and operating accounts with the Lender.

 

(f)    Compliance with Laws, etc. The Borrower will, and will cause each Loan Party and its Subsidiaries to, (i) comply in all material respects with all applicable laws, rules, regulations, and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments, and governmental charges imposed upon it or upon its property except where the amount or validity of any such tax, assessment, or governmental charge is being contested in good faith by appropriate proceedings and reserves in conformity with GAAP with respect thereto have been provided on the books of the Loan Parties and their Subsidiaries, and (ii) maintain in effect and enforce policies and procedures designed to ensure compliance by the Loan Parties, their Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws, Anti-Terrorism Laws and applicable Sanctions.

 

 

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¹ Insurance maintained by the Borrower to be confirmed.

 

 

(g)    Use of Proceeds. The proceeds of the Loans will be used only for funding Capital Expenditures related to infrastructure acquisitions in the ordinary course of business of the Borrower and its Subsidiaries. No part of the proceeds of the Loans will be used, whether directly or indirectly, for any purpose that entails a violation of any of the Regulations of the Board, including Regulations T, U and X. The Borrower will not request the Loans, and the Borrower shall not use, and shall ensure that its Subsidiaries and its or their respective directors, officers, employees and agents shall not use, the proceeds of the Loans (i) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value, to any Person in violation of any Anti-Corruption Laws or any Anti-Terrorism Laws in any material respect, (ii) for the purpose of funding, financing or facilitating any activities, business or transaction of (or with) any Sanctioned Person, or in any Sanctioned Country, or (iii) in any manner that would result in the violation of any Sanctions applicable to any party hereto.

 

(h)    Inspection Rights. The Borrower will, and will cause each of the other Loan Parties to, permit any representatives designated by the Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its books and records, including environmental assessment reports and Phase I or Phase II studies on real property owned by Borrower, to perform field examinations and collateral reviews and to discuss its affairs, finances and condition with its officers and independent accountants, all at such reasonable times and as often as reasonably requested. Notwithstanding the foregoing, the Borrower shall not be required to reimburse the Lender for more than one such inspection in any calendar year, unless an Event of Default has occurred and is continuing.

 

(i)    Collateral; Further Assurances.

 

(i)    As promptly as possible but in any event within twenty (20) days after any Person becomes a Material Subsidiary, the Borrower shall notify the Lender thereof and cause such Material Subsidiary to deliver to the Lender a joinder to the Guaranty and the applicable Security Documents (in a form satisfactory to the Lender) pursuant to which such Material Subsidiary agrees to be bound by the terms and provisions thereof, such joinder to be accompanied by appropriate resolutions, other documentation and legal opinions in form and substance reasonably satisfactory to the Lender.

 

(ii)    The Borrower will cause, and will cause each other Loan Party to cause, all of its owned property to be subject at all times to first priority, perfected Liens in favor of the Lender to secure the Obligations in accordance with the terms and conditions of the Security Documents, subject in any case to Liens permitted by Section 13(b).

 

(iii)    Without limiting the foregoing, the Borrower will, and will cause each Loan Party to, execute and deliver, or cause to be executed and delivered, to the Lender such documents, agreements and instruments, and will take or cause to be taken such further actions (including the filing and recording of financing statements, fixture filings, mortgages, deeds of trust and other documents and such other actions or deliveries), which may be required by law or which the Lender may, from time to time, reasonably request to carry out the terms and conditions of the Loan Documents and to ensure perfection and priority of the Liens created or intended to be created by the Security Documents, all at the expense of the Borrower.

 

 

(j)    Collateral Access Agreements. If requested by Lender, the Borrower will use commercially reasonable efforts to provide the Lender with a Collateral Access Agreement with respect to each landlord, warehouseman, processor, shipper or bailee, and any other Person(s) in possession of any Collateral. For the avoidance of doubt, the Borrower’s failure to satisfy the requirements of this Section 12(j) shall not constitute an Event of Default hereunder so long as Borrower is using commercially reasonable efforts to satisfy the same.

 

(k)    Control Agreements. If requested by Lender, the Borrower will use commercially reasonable efforts to deliver deposit account control agreements, in form and substance acceptable to Lender, with respect to any deposit account that the Borrower or any other Loan Party does not maintain with Lender. For the avoidance of doubt, the Borrower’s failure to satisfy the requirements of this Section 12(k) shall not constitute an Event of Default hereunder so long as Borrower is using commercially reasonable efforts to satisfy the same.

 

(l)    Collateral Audits. The Borrower shall permit the Lender or one or more designees of Lender to perform such appraisals of Collateral, field examinations, collateral analysis, monitoring or such other business analysis as reasonably required by Lender and shall in connection therewith provide the Lender with access during normal business hours with reasonable prior notice (provided that after the occurrence and during the continuance of an Event of Default, the Lender shall be provided access at any time) to all facilities and all books and records of the Borrower required by Lender to conduct such audits and appraisals. Notwithstanding the foregoing, the Borrower shall not be required to reimburse the Lender for any such field examinations, collateral analysis, monitoring or such other business analysis and appraisals more than one time in any calendar year, unless an Event of Default has occurred and is continuing.

 

13.    Negative Covenants. Until the Obligations shall have been paid in full in cash and this Agreement irrevocably terminated, the Borrower covenants and agrees with the Lender that:

 

(a)    Indebtedness. The Borrower will not, and will not permit any other Loan Party to, create, incur, assume or permit to exist any Indebtedness, except for (i) Indebtedness owing to the Lender and its Affiliates and (ii)(A) purchase‑money Indebtedness incurred to finance the acquisition of any fixed or capital assets and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof and (B) Capital Lease Obligations and, in the case of each of clauses (A) and (B), extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof, provided that the aggregate principal amount of such purchase‑money Indebtedness and Capital Lease Obligations shall not exceed $500,000 at any time outstanding, (iii) Indebtedness existing on the Closing Date and set forth Schedule 13(a) and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof, (iv) unsecured Indebtedness owing to Fiber Fast Homes, LLC in an aggregate principal amount not exceeding $1,000,000 at any time outstanding, (v) other unsecured Indebtedness in an aggregate principal amount not exceeding the Threshold Amount at any time outstanding, (vi) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or other similar instrument drawn against insufficient funds in the ordinary course of business, (vii) Indebtedness under performance bonds, surety bonds, release, appeal and similar bonds, statutory obligations or with respect to workers’ compensation claims, in each case incurred in the ordinary course of business, and reimbursement obligations in respect of any of the foregoing, (viii) intercompany loans and advances to the extent permitted by Section 13(d) (other than any Indebtedness permitted under clause (iv) of this Section 13(a) which shall be limited as provided in such clause (iv)), (ix)(A) Indebtedness in the form of any indemnification, adjustment of purchase price, earn-out, non-compete, consulting, deferred compensation and similar obligations of the Borrower or its Subsidiaries and (B) Indebtedness incurred by the Borrower or any of its Subsidiaries under agreements providing for earn-outs or the adjustment of the purchase price or similar adjustments, in each case, in connection any Permitted Acquisition or other investment permitted under this Agreement, (x) Indebtedness in respect of letters of credit or bonds backing obligations under insurance policies or related to self-insurance obligations or consisting of the financing of insurance premiums, incurred in the ordinary course of business, and (xi) Indebtedness of any Person that becomes a Subsidiary after the Closing Date in connection with a Permitted Acquisition; provided such Indebtedness exists at the time such Person becomes a Subsidiary and is not created in contemplation of or in connection with such Person becoming a Subsidiary.

 

 

(b)    Liens. The Borrower will not, and will not permit any Loan Party to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, except: (i) Liens in favor of the Lender (ii) Permitted Encumbrances, (iii) any Lien on any property or asset existing on the Closing Date and set forth on Schedule 13(b); provided that (A) such Lien shall not apply to any other property or asset and (B) such Lien shall secure only those obligations which it secures on the Closing Date (iv) Liens upon assets of a Loan Party or any of its Subsidiaries securing Indebtedness permitted by Section 13(a)(ii); provided that (x) such Liens only serve to secure the payment of Indebtedness arising under such purchase-money Indebtedness or Capital Lease Obligations and (y) the Lien encumbering the asset giving rise to the purchase-money Indebtedness or Capital Lease Obligation does not encumber any other asset of any Loan Party or any of its Subsidiaries and (v) Liens not otherwise permitted hereunder securing Indebtedness or other obligations in a principal amount not exceeding the Threshold Amount at any time outstanding.

 

(c)    Fundamental Changes; Asset Sales; Guarantees.

 

(i)    The Borrower will not, and will not permit any Loan Party to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or sell, transfer, lease or otherwise dispose of (in one transaction or in a series of transactions) any of its assets (including pursuant to a Sale and Leaseback Transaction), or any of its Equity Interests or the Equity Interests of any of its Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing, (A) any Subsidiary may merge into a Loan Party in a transaction in which the surviving entity is such Loan Party (provided that any such merger involving the Borrower must result in the Borrower as the surviving entity); provided that, any such merger or consolidation involving a Person that is not a wholly-owned Subsidiary immediately prior to such merger or consolidations shall not be permitted, (B) any Subsidiary may sell, transfer, lease or otherwise dispose of its assets to a Loan Party and (C) the Loan Parties and their Subsidiaries may (1) sell inventory and Cash Equivalents in the ordinary course of business, (2) effect sales, trade-ins or dispositions of used equipment for value in the ordinary course of business consistent with past practice, (3) enter into licenses of technology in the ordinary course of business, and (4) make any other sales, transfers, leases or dispositions of assets with a book value that, together with the book value of all other property of the Loan Parties and their Subsidiaries previously leased, sold or disposed of as permitted by this clause (4) during any fiscal year of the Borrower, does not exceed the Threshold Amount.

 

 

(ii)    The Borrower will not, and will not permit any Loan Party to, engage to any material extent in any business other than businesses of the type conducted by the Loan Parties and their Subsidiaries on the Closing Date and businesses reasonably related or incidental thereto.

 

(iii)    The Borrower will not, nor will it permit any Loan Party to, change its fiscal year from the basis in effect on the Closing Date.

 

(iv)    The Borrower will not, and will not permit any Loan Party to, consummate a Division, without the prior written consent of the Lender.

 

(v)    The Borrower will not, and will not permit any Loan Party to, guarantee any obligations of any Person (other than another Loan Party).

 

(d)         Investments. The Borrower will not, and will not permit any Loan Party to, purchase, hold or acquire (including pursuant to any merger or consolidation with any Person that was not a wholly owned Subsidiary prior to such merger or consolidation) any capital stock, evidences of Indebtedness or other securities (including any option, warrant or other right to acquire any of the foregoing) of, make or permit to exist any loans or advances to, guarantee any obligations of, or make or permit to exist any investment or any other interest in, any other Person, or purchase or otherwise acquire (in one transaction or a series of transactions) any Person or any assets of any other Person constituting a business unit, except (i) Cash Equivalents, (ii) investments, loans or advances made by a Loan Party in or to any other Loan Party, (iii) investments, loans or advances in or to Excluded Subsidiaries (x) in an aggregate amount not to exceed $1,000,000 at any time outstanding or (y) approved by Lender in writing in its reasonable discretion, (iv) guarantees constituting Indebtedness permitted by Section 13(a), (v) investments existing on the Closing Date and listed on Schedule 13(d), (vi) extensions of trade credit in the ordinary course of business (including any instrument evidencing the same and any instrument, security, or other asset acquired through bona fide collection efforts with respect to the same), (vii) loans and advances to officers, directors, or employees of any Loan Party in the ordinary course of business (including for travel, entertainment, and relocation expenses (but not to repurchase Equity Interests) in an aggregate amount not to exceed $500,000 at any time outstanding, (viii) investments in the form of Swap Agreements permitted by Section 13(k), and (ix) Permitted Acquisitions.

 

(e)         Transactions with Affiliates. The Borrower will not, and will not permit any Loan Party to, sell, lease or otherwise transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or pay any management, advisory, or similar fees to, or otherwise engage in any other transactions with, any of its Affiliates, except (a) in the ordinary course of business at prices and on terms and conditions not less favorable to the Borrower or such Loan Party than could be obtained on an arm’s-length basis from unrelated third parties, (b) transactions in the ordinary course of business between or among a Loan Party and its wholly owned Subsidiaries not involving any other Affiliate and (c) any Restricted Payment permitted by Section 13(f).

 

 

(f)         Restricted Payments. The Borrower will not, and will not permit any Loan Party or any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except that so long as no Event of Default has occurred and is continuing: (a) a Loan Party may declare and pay dividends with respect to its Equity Interests payable solely in additional shares of its common stock, (b) Loan Parties may declare and pay dividends ratably with respect to their Equity Interests to other Loan Parties, (c) so long as it is permitted by law, and so long as no Default or Event of Default has occurred and is continuing or would result from such payment and so long as a Loan Party is a “pass-through” tax entity for United States federal income tax purposes, and after first providing such supporting documentation as the Lender may request, such Loan Party may declare and pay Pass-Through Tax Liabilities, (d) the Loan Parties may make payments with respect to Indebtedness that is contractually subordinated in right of payment to the Obligations to the extent permitted by the applicable subordination agreement and (e) so long as no Default or Event of Default has occurred and is continuing or would result from such payment BOB may declare and pay dividends to Parent.

 

(g)         Restrictive Agreements. The Borrower will not, and will not permit any Loan Party to, directly or indirectly, enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Loan Party to create, incur or permit to exist any Lien upon any of its property or assets, (b) the ability of any Loan Party to pay dividends or other distributions with respect to holders of its Equity Interests or to make or repay loans or advances to the Borrower or any other Loan Party or to guarantee Indebtedness of the Borrower or any other Loan Party or (c) the ability of any Loan Party to transfer any of its assets to the Borrower or any other Loan Party; provided that the foregoing shall not apply to (i) restrictions and conditions imposed by law or by any Loan Document, (ii)  clauses (a) and (c) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness and (iii) clause (a) and (c) of the foregoing shall not apply to customary provisions in leases and other contracts restricting the assignment thereof.

 

(h)         Sale and Leaseback Transactions. The Borrower shall not, nor shall it permit any Loan Party to, create, incur, assume or suffer to exist any obligations as lessee for the rental or hire of real or personal property in connection with any Sale and Leaseback Transaction.

 

(i)         Limitation on Amendments of Material Contracts. The Borrower shall not, nor shall it permit any Loan Party to, amend, supplement, or otherwise modify (pursuant to a waiver or otherwise): (i) its articles of incorporation, certificate of designation, operating agreement, bylaws, or other organizational document; or (ii) the terms and conditions of any Material Contract, in each case, in any respect materially adverse to the interests of the Lender, without the Lender’s prior written consent.

 

(j)         Financial Covenants. The Borrower shall not:

 

(i)         Consolidated Fixed Charge Coverage Ratio: As of the end of any fiscal quarter, permit the Consolidated Fixed Charge Coverage Ratio to be less than 1.15 to 1.00 for the twelve month period ending as of the last day of such fiscal quarter.

 

 

(ii)         Consolidated Total Leverage Ratio: As of the end of any fiscal quarter, permit the Consolidated Total Leverage Ratio to be greater than 3.50 to 1.00 as of the last day of such fiscal quarter.

 

(iii)          Maximum Capital Expenditures: During any trailing twelve-month period, make or expend Capital Expenditures (other than Maintenance Capital Expenditures or any other Capital Expenditures financed with proceeds of any Term Loan, with the proceeds of purchase money Indebtedness or Capital Leases to the extent permitted herein or with a capital contribution by Parent to BOB or any Subsidiary), in the aggregate in excess of Consolidated Adjusted EBITDA, minus (A)  any dividends or distributions paid by BOB to Parent in cash, minus (B) the cash portion of taxes paid, minus (C) Unfinanced Maintenance Capital Expenditures (other than Maintenance Capital Expenditures funded by means of a capital contribution by Parent to BOB or any Subsidiary), minus (D) principal amortization payments or redemptions (as initially scheduled on the incurrence of such debt and excluding optional prepayments thereof) on Consolidated Funded Indebtedness to be paid in cash for such period, minus (E) actual cash payments made with respect to Capital Lease Obligations during such period, and minus (F) cash Interest Expense for such period.

 

(k)          Swap Agreements. No Loan Party will enter into any Swap Agreement, except (a) Swap Agreements entered into to hedge or mitigate risks to which a Loan Party has actual exposure, and (b) Swap Agreements entered into in order to effectively cap, collar or exchange interest rates (from floating to fixed rates, from one floating rate to another floating rate or otherwise) with respect to any interest-bearing liability or investment of any Loan Party.

 

14.    Events of Default. Upon the occurrence of any of the following events (each, an “Event of Default”):

 

(a)    any Loan Party shall fail to pay any (i) principal when and as the same shall become due and payable or (ii) any interest or other amount when and as the same shall become due and payable and such failure to pay such interest or other amount shall continue unremedied for a period of three (3) Business Days; or

 

(b)    any representation or warranty made or deemed made by or on behalf of the Borrower or any other Loan Party in or in connection with any Loan Document, or in any report, certificate, financial statement or other document furnished pursuant to or in connection with any Loan Document, shall prove to have been incorrect or misleading in any material respect when made or deemed made; or

 

(c)    the Borrower or any other Loan Party, as applicable, shall fail to observe or perform any covenant, condition or agreement contained in Section 12(a), 12(b), 12(c), 12(d), 12(g), 12(i) 12(k) or 13 of this Agreement or the Security Agreement; or

 

(d)    any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in any Loan Document (other than those specified in clause (a) or (c) of this Section 14), and such failure shall continue unremedied for a period of fifteen (15) Business Days after the earlier of (i) notice thereof from the Lender to the Borrower and (ii) an Authorized Officer of the Borrower or such Loan Party has obtained knowledge thereof, provided, if such failure is not reasonably capable of being cured within such 15-Business Day period, such Loan Party shall have a reasonable time (but in any event no longer than 60 days from such notice) to cure provided that such Loan Party commences such cure within said 15-Buiness Day period and diligently pursues such cure; or

 

 

(e)    (i) the Borrower or any other Loan Party shall fail to make any payment (whether of principal or interest and regardless of amount) in respect of any Material Indebtedness (other than the Loans) of the Borrower or such other Loan Party, when and as the same shall become due and payable or (ii) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits (with or without the giving of notice, the lapse of time or both) the holder(s) of any Material Indebtedness (or any trustee or agent on their behalf) to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this clause (e)(ii) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness; or

 

(f)    (i) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (A) liquidation, reorganization or other relief in respect of the Borrower or any other Loan Party or its debts, or of a substantial part of its assets, under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect or (B) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any other Loan Party or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for ninety (90) days or an order or decree approving or ordering any of the foregoing shall be entered, (ii) the Borrower or any other Loan Party shall (A) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under any federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (B) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in Section 10(f)(i), (C) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any other Loan Party or for a substantial part of its assets, (D) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (E) make a general assignment for the benefit of creditors or (F) take any action for the purpose of effecting any of the foregoing or (iii) the Borrower or any other Loan Party is generally not, or is unable to, or admits in writing its inability to, pay its debts as they become due; or

 

(g)    one or more judgments for the payment of money in an aggregate amount in excess of the Threshold Amount shall be rendered against the Borrower, any other Loan Party or any combination thereof and the same shall remain undischarged for a period of thirty (30) consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to attach or levy upon any assets of the Borrower or any other Loan Party to enforce any such judgment or the Borrower or any other Loan Party shall fail within thirty (30) days to discharge one or more non-monetary judgments or orders which, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect, which judgments or orders, in any such case, are not stayed on appeal or otherwise being appropriately contested in good faith by proper proceedings diligently pursued; or

 

 

(h)    any ERISA Event shall occur which individually or together with all other events or conditions, if any, could subject the Borrower or any other Loan Party to any tax, penalty, or other liability which in the aggregate would exceed the Threshold Amount or result in a Lien; or

 

(i)    a Change in Control shall occur; or

 

(j)    (i) any Loan Document shall cease, for any reason, to be in full force and effect, or the Borrower or any other Loan Party shall so assert in writing or shall disavow in writing any of its obligations thereunder or (ii) any Security Document shall for any reason fail to create a valid and perfected first priority security interest in any portion of the Collateral purported to be covered thereby, except as permitted by the terms of any Loan Document; or

 

(k)    Any license, permit or approval granted by any Government Authority or by any state or local commission or authority, whether presently existing or hereafter granted to or obtained by the Borrower that is, in the reasonable judgment of the Lender, material to the operations of the Borrower, shall expire without renewal or shall be suspended or revoked and such expiration, suspension or revocation is not fully remedied or cured within thirty (30) days thereafter or otherwise stayed by legal proceedings;

 

then, and in every such event (other than an event with respect to the Borrower or any other Loan Party described in Section 14(f)), and at any time thereafter during the continuance of such event, the Lender may, by notice to the Borrower: (i) terminate the Term Loan Commitment, and thereupon the Term Loan Commitment shall terminate immediately, (ii) declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other Obligations of the Borrower accrued hereunder and under the other Loan Documents, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower (provided, that Swap Agreement Obligations shall be terminated or accelerated solely in accordance with the relevant Swap Agreement); and in case of any event described in Section 14(f), the Term Loan Commitment shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other Obligations accrued hereunder and under the other Loan Documents, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the Borrower. Upon the occurrence and during the continuance of an Event of Default, the Lender may exercise any rights and remedies provided to the Lender under the Loan Documents or at law or equity, including all remedies provided under the Uniform Commercial Code as in effect in the State of Nebraska or any other applicable jurisdiction.

 

 

Notwithstanding anything to the contrary contained in this Section 14, in the event that the Loan Parties fail (or, but for the operation of this paragraph, would fail) to comply with any of the financial covenants set forth in Section 13(j) (the “Financial Covenants”), as of the end of any fiscal quarter, then within ten (10) days after the date on which a Compliance Certificate calculating the Financial Covenants is required to be delivered pursuant to Section 12(a)(iii) for such fiscal quarter, Parent shall have the right pursuant to a written notice delivered to the Lender stating its intent to cure such failure, to issue Equity Interests (which Equity Interests will be common Equity Interests) for cash, or otherwise receive cash contributions to its capital, and in each case to contribute any such cash as common equity to the capital of the BOB (collectively, the “Cure Right”), and upon the receipt by BOB of such cash (the “Cure Amount”) pursuant to the exercise of such Cure Right and request to the Lender to effect such recalculation and receipt by the Lender of such proceeds to be applied as a mandatory prepayment as provided in Section 2(f), the applicable Financial Covenants shall be recalculated giving effect to the following pro forma adjustments: (i) Consolidated Adjusted EBITDA shall be increased for the applicable fiscal quarter and any four quarter period that includes such fiscal quarter, solely for the purpose of measuring the Financial Covenants, and not for any other purpose under this Agreement, by an amount equal to the Cure Amount; and (ii) if, after giving effect to the foregoing recalculation, the Loan Parties shall then be in compliance with the requirements of the Financial Covenants, the Loan Parties shall be deemed to have satisfied the requirements of the Financial Covenants as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the Financial Covenant that had occurred shall be deemed cured for the purposes of this Agreement; provided, however, (x) the Cure Amount will be no more than the minimum amount required to cause the Loan Parties to be in pro forma compliance with the applicable Financial Covenant; (y) the Cure Right may not be exercised more than three (3) times during the term of this Agreement; and (z) in any four (4) fiscal quarter period, there shall be a period of at least two (2) fiscal quarters during which the Cure Right has not been exercised.

 

15.    Miscellaneous.

 

(a)    Notices. All notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by e-mail, as follows:

 

(i)    if to the Borrower, to it at c/o Boston Omaha Corporation, 1601 Dodge St., Ste. 3300, Omaha, NE 68102, Attention of Max Meisinger, E-mail: max@bostonomaha.com; with a copy to Koley Jessen, P.C., L.L.O., 1125 South 103rd Street, Suite 800, Omaha, NE  68124, attention: Dan McMahon, Esq., E-mail: dan.mcmahon@koleyjessen.com; and

 

(ii)    if to the Lender, to it at First National Bank of Omaha, 1620 Dodge Street, Stop 3306, Omaha, NE 68102, Attention of Kara Geweke, E-mail: kgeweke@fnbo.com with a copy to Kutak Rock LLP, 1650 Farnam Street, Omaha, NE 68102, attention: Thomas Makens, Esq., E-mail: thomas.makens@kutakrock.com.

 

All such notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; provided that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business Day for the recipient. Notwithstanding the foregoing, the Lender may, in its discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it; provided that, approval of such procedures may be limited to particular notices or communications. All such notices and other communications sent to an email address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient; provided that, if not given during the normal business hours of the recipient, such notice or communication shall be deemed to have been given at the opening of business on the next Business Day for the recipient. Either party hereto may change its address or email address for notices and other communications hereunder by written notice to the other party.

 

 

(b)    Waiver; Amendments. No failure to exercise and no delay in exercising, on the part of the Lender, any right, remedy, power, or privilege hereunder or under the other Loan Documents shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. The rights, remedies, powers, and privileges herein provided are cumulative and not exclusive of any rights, remedies, powers, and privileges provided by law. No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall comply with the succeeding paragraph of this Section, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of any Default, regardless of whether the Lender may have had notice or knowledge of such Default at the time.

 

Neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended, or modified except (i) in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrower and the Lender or (ii) in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Lender and the Loan Party or Loan Parties that are parties thereto.

 

(c)    Right of Setoff. If an Event of Default shall have occurred and be continuing, the Lender and each of its Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits at any time held and other obligations at any time owing by the Lender or such Affiliate to or for the credit or the account of the Borrower or any Guarantor against any of and all of the Obligations held by the Lender.

 

(d)    Costs, Expenses, Fees and Taxes.

 

(i)    The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Lender and its Affiliates (including the reasonable and documented fees, charges and disbursements of outside counsel for the Lender) in connection with the Loans and the other transactions provided for herein, the preparation, negotiation, execution, delivery and administration of the Loan Documents or any amendments, modifications or waivers of the provisions thereof, and (ii) all reasonable out-of-pocket expenses incurred by the Lender (including the reasonable and documented fees, charges and disbursements of any outside counsel for the Lender) in connection with the enforcement or protection of its rights (A) in connection with the Loan Documents, including its rights under this Section 15(d)(i), or (B) in connection with the Loans made hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans. In addition, the Borrower shall pay any and all stamp and other similar taxes and fees payable or determined to be payable in connection with the execution, delivery, filing, and recording of, or otherwise with respect to, any of the Loan Documents and the other documents to be delivered under any such Loan Documents, and agrees to hold the Lender harmless from and against any and all liabilities with respect to or resulting from any delay in paying or omission to pay such taxes and fees. The provisions of this Section 15(d)(i) shall survive termination of this Agreement.

 

 

(ii)    If a payment made to the Lender hereunder would be subject to U.S. federal withholding tax imposed by FATCA if the Lender were to fail to comply with the applicable reporting requirements of FATCA, the Lender shall deliver to the Borrower at the time or times prescribed by law and at such time or times reasonably requested by the Borrower such documentation prescribed by applicable law and such additional documentation reasonably requested by the Borrower as may be necessary for the Borrower to comply with their obligations under FATCA and to determine that the Lender has complied with its obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this subsection, “FATCA” shall include any amendments made to FATCA after the date of this Agreement. This subsection shall not be construed to require the Lender to make available its tax returns (or any other information relating to its taxes that it deems confidential) to the Borrower.

 

(iii)    All payments to be made by the Borrower hereunder shall be made in immediately available funds, without setoff, recoupment, deduction, defense or counterclaim and free and clear of, and, except as required by applicable law, without deduction or withholding for or on account of, any present or future income, franchise, excise, stamp or other taxes, levies, imposts, duties or other charges of any kind now or hereafter imposed by any governmental or taxing authority, but excluding taxes imposed on or measured by the net income of the Lender by the jurisdiction of its organization, the United States, the State of Nebraska or the City of Omaha, Nebraska or any taxing authority thereof (such non‑excluded items, “Taxes”). If, under applicable law, any such Taxes are required to be deducted or withheld from any such payment, the Borrower will pay additional interest or will make additional payments in such amounts as may be necessary so that the net amount received by the Lender, after withholding or deduction therefor and for any Taxes and other taxes on such additional interest or amounts, will be equal to the amount provided for herein. The Borrower hereby agrees to indemnify and to hold the Lender harmless against, the full amount of Taxes, imposed on or paid or payable by the Lender, and any liability (including penalties, additions to tax, interest and expenses) arising therefrom or with respect thereto. The indemnity by the Borrower provided for in this paragraph shall apply and be made whether or not the Taxes for which indemnification hereunder is sought have been correctly or legally asserted. Determinations by the Lender pursuant to this paragraph shall be conclusive absent manifest error. The Borrower agrees to furnish promptly to the Lender official receipts evidencing payment of any Taxes so withheld or deducted. The agreements of the Borrower in this paragraph shall survive repayment of all Obligations of the Borrower to the Lender hereunder and under the other Loan Documents.

 

(iv)    Amounts payable by the Borrower under this Section 15(d) shall be paid within ten (10) days from the date on which the Lender makes written demand therefor.

 

 

(e)    Indemnity. The Borrower shall indemnify the Lender, the Lender’s Affiliates, and the respective partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of the Lender and its Affiliates (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses (including the reasonable and documented fees, charges and disbursements of any outside counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of any Loan Document or any agreement or instrument contemplated thereby, the performance by the parties hereto of their respective obligations thereunder or the consummation of the transactions contemplated hereby, (ii) the Loans or the use or proposed use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Subsidiaries, or any Environmental Liability related in any way to the Borrower or any of its Subsidiaries, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, brought by a third party and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Indemnitee. This indemnity shall survive termination of this Agreement. Amounts payable by the Borrower under this Section 15(e) shall be paid within ten (10) days from the date on which the Lender makes written demand therefor.

 

(f)    Successors and Assigns. (i) The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void). Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby and, to the extent expressly contemplated hereby, the Affiliates of the Lender) any legal or equitable right, remedy, or claim under or by reason of this Agreement.

 

(ii)         The Lender may, at any time, with the prior written consent of the Borrower, provided, that (A) no consent of the Borrower shall be required for an assignment to an Affiliate or, if an Event of Default has occurred and is continuing, to any other Eligible Assignee (as defined below), and (B) the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Lender within five (5) Business Days after having received notice thereof, assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of the Term Loan Commitments and the Loans at the time owing to it). For purposes of this Agreement, “Eligible Assignee” means any Person other than a natural Person that is (i) an Affiliate of the Lender, (ii) a commercial bank, insurance company, investment or mutual fund, or other Person that is an “accredited investor” (as defined in Regulation D under the Securities Act of 1933), or (iii) a corporate entity that possesses financial sophistication and standing similar to that of the Lender. Subject to notification of an assignment, the assignee shall be a party hereto and, to the extent of the interest assigned, have the rights and obligations of the Lender under this Agreement, and the Lender shall, to the extent of the interest assigned, be released from its obligations under this Agreement (and, in the case of an assignment covering all of the Lender’s rights and obligations under this Agreement, the Lender shall cease to be a party hereto but shall continue to be entitled to the benefits of Sections 5, 6, 15(d), (e) and (l)). The Borrower hereby agrees to execute any amendment and/or any other document that may be necessary to effectuate such an assignment, including an amendment to this Agreement to provide for multiple lenders and an administrative agent and collateral agent to act on behalf of such lenders. Any assignment or transfer by the Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by the Lender of a participation in such rights and obligations in accordance with this Section.

 

 

(iii)         The Lender may, at any time, without the consent of the Borrower, sell participations to one or more banks or other entities (each, a “Participant”) in all or a portion of the Lender’s rights and obligations under this Agreement (including all or a portion of the Term Loan Commitments and the Loans owing to it); provided that (i) the Lender’s obligations under this Agreement shall remain unchanged, (ii) the Lender shall remain solely responsible to the other parties hereto for the performance of such obligations, and (iii) the Borrower shall continue to deal solely and directly with the Lender in connection with the Lender’s rights and obligations under this Agreement. The Borrower agrees that each Participant shall be entitled to the benefits of Sections 5, 6, 15(d), (e) and (l) to the same extent as if it were the Lender and had acquired its interest by assignment pursuant to this Section; provided that, such Participant (A) agrees to be subject to the provisions of Section 1(d) as if it were an assignee under this Section and (B) shall not be entitled to receive any greater payment under Sections 5, 6, or 15(d), with respect to any participation, than the Lender would have been entitled to receive, except to the extent such entitlement to receive a greater payment results from a Change in Law that occurs after the Participant acquired the applicable participation. The Lender shall, acting solely for this purpose as an agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”); provided that, the Lender shall have no obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in the Loans, or other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary to establish that the Loans, or other obligation is in registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and the Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary. To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 15(c) as though it were the Lender.

 

(iv)         In addition, the Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of the Lender, including, without limitation, any pledge or assignment to secure obligations to a Federal Reserve Bank, and this Section 15(f) shall not apply to any such pledge or assignment of a security interest.

 

 

(g)    Counterparts; Integration; Severability. This Agreement may be executed in any number of counterparts and all of such counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by electronic transmission shall be effective as delivery of a manually executed counterpart of this Agreement. This Agreement and the other Loan Documents, and any separate letter agreements with respect to fees payable to the Lender, constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. The words “execution,” “signed,” “signature,” and words of similar import in any Loan Document shall be deemed to include electronic or digital signatures or the keeping of records in electronic form, each of which shall be of the same effect, validity, and enforceability as manually executed signatures or a paper-based recordkeeping system, as the case may be, to the extent and as provided for under applicable law, including the Electronic Signatures in Global and National Commerce Act of 2000 (15 USC § 7001 et seq.) or any other state laws based on the Uniform Electronic Transactions Act.

 

(h)    Interest Rate Limitation. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan Documents shall not exceed the maximum rate of non-usurious interest permitted by applicable law (the “Maximum Rate”). If the Lender shall receive interest in an amount that exceeds the Maximum Rate, the excess interest shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the interest contracted for, charged, or received by the Lender exceeds the Maximum Rate, such Person may, to the extent permitted by applicable law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments and the effects thereof and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the contemplated term of the Obligations hereunder.

 

(i)    Governing Law; Jurisdiction; Consent to Service of Process; etc. This Agreement shall be construed in accordance with and governed by the law of the State of Nebraska. The Borrower hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of any state court of the State of Nebraska sitting in Douglas County, Nebraska, and of the United States District Court for the District of Nebraska, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such Nebraska state or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in any Loan Document shall affect any right that the Lender may otherwise have to bring any action or proceeding relating to any Loan Document against any Loan Party or its properties in the courts of any jurisdiction. The Borrower hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to any Loan Document in any court referred to in the second sentence of this Section 15(i). Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 15(a). Nothing in this Agreement or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.

 

 

(j)    WAIVER OF TRIAL BY JURY. EACH PARTY HERETO MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH ANY LOAN DOCUMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY. THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE LENDER TO MAKE THE LOANS UNDER THIS AGREEMENT.

 

(k)    USA PATRIOT Act. The Lender hereby notifies each Loan Party that pursuant to the requirements of the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Act”), it may be required to obtain, verify and record information that identifies such Loan Party, which information includes the name and address of such Loan Party and other information that will allow the Lender to identify such Loan Party in accordance with the Act.

 

(l)    WAIVER OF SPECIAL DAMAGES. TO THE EXTENT PERMITTED BY APPLICABLE LAW, NEITHER THE BORROWER NOR ANY GUARANTOR SHALL ASSERT, AND HEREBY WAIVES, ANY CLAIM AGAINST THE LENDER ON ANY THEORY OF LIABILITY FOR SPECIAL, INDIRECT, CONSEQUENTIAL OR PUNITIVE DAMAGES (AS OPPOSED TO DIRECT OR ACTUAL DAMAGES) ARISING OUT OF, IN CONNECTION WITH, OR AS A RESULT OF THIS AGREEMENT, ANY AGREEMENT OR INSTRUMENT CONTEMPLATED HEREBY OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

(m)    Confidential Information. The Lender shall not disclose any information that the Borrower furnishes to the Lender hereunder or pursuant to any of the other Loan Documents and designates in writing to be confidential (but not including any such information that is or becomes generally available to the public or that is or becomes available to the Lender from a source other than the Borrower) to any Person without the consent of the Borrower, other than (a) to the Lender’s Affiliates and its and their officers, directors, employees, agents and advisors, (b) to actual or prospective assignees or participants or pledgee of the Lender’s interests under this Agreement or any financing sources of the Lender, and then only on a confidential basis, (c) as required by any law, rule or regulation or judicial process, (d) as requested or required by any state, federal or foreign authority or examiner regulating the Lender or (e) to any actual or bona fide prospective counterparty (or its advisors) to any swap or derivative transaction relating to the Loan Parties and their obligations.

 

 

(n)    Survival. All covenants, agreements, representations, and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of the Loans on the Closing Date, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Lender may have notice or knowledge of any Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the principal of, or any accrued interest on, any Loans or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as this Agreement has not been irrevocably terminated.

 

Section 16.          Co-Borrower Provisions.

 

(a)         Joint and Several Liability. References in any Loan Document to “Borrower” are to each Person signing this Agreement as Borrower (each, a “Co-Borrower”). Each Co-Borrower’s liability with respect to the Obligations is joint and several, notwithstanding the provisions of subsection (c) below, including any allocation of losses and liabilities pursuant to such subsection or otherwise. Each Co-Borrower is a direct, primary and independent obligor, and no Co-Borrower shall be deemed to be a guarantor, accommodation party or otherwise secondarily liable for the Obligations. Each Co-Borrower represents and warrants to and covenants with the Lender that (i) each Co-Borrower is engaged in operations that require financing on a joint basis and, accordingly, each Co-Borrower will materially benefit, directly or indirectly, from each Loan; (ii) each Loan has been offered to Co-Borrowers on a joint basis and would not be available to Co-Borrowers on an individual basis on the terms and conditions stated in this Agreement; and (iii) the benefits received by each Co-Borrower are reasonably equivalent to the obligations undertaken by each Co-Borrower.

 

(b)         Obligations and Allocations among Co-Borrowers. If any Co-Borrower (“Overpaying Borrower”) pays (whether directly or by application of Collateral), or is otherwise held liable for, obligations in excess of its Pro Rata Share, the other Co-Borrowers will pay the amount of such excess to Overpaying Borrower and will indemnify Overpaying Borrower for, from and against any claims, damages, loss or liability arising from or related to such overpayment. Co-Borrowers agree to maintain books and records accurately reflecting each Co-Borrower’s Pro Rata Share. This subsection is only intended to allocate payments, losses, and liabilities among Co-Borrowers in order that (i) as between Co-Borrowers, each Co-Borrower is ultimately liable for its Pro Rata Share; and (ii) the value to each Borrower of the resulting rights and claims against other Borrowers pursuant to this subsection will assure that no Borrower is rendered “insolvent” by virtue of the Obligations for purposes of any applicable Requirement of Law relating to fraudulent conveyances and similar claims. The rights and obligations among Co-Borrowers pursuant to this subsection shall survive the payment and performance of the Obligations. “Pro Rata Share” means, with respect to any Co-Borrower, the amount of Loan proceeds actually advanced to, or on behalf of, such Co-Borrower as reflected on the books and records of such Co-Borrower.

 

 

Section 17. Keepwell. Each Qualified ECP Guarantor hereby jointly and severally absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as may be needed from time to time by each other Loan Party to honor all of its obligations in respect of a Swap Obligation (provided, however, that each Qualified ECP Guarantor shall only be liable under this Section 17 for the maximum amount of such liability that can be hereby incurred without rendering its obligations under this Section 17 voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for any greater amount). Except as otherwise provided herein, the obligations of each Qualified ECP Guarantor under this Section 17 shall remain in full force and effect until the termination of all Swap Obligations. Each Qualified ECP Guarantor intends that this Section 17 constitute, and this Section 17 shall be deemed to constitute, a “keepwell, support, or other agreement” for the benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

 

Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Related Hedging Contracts or any other agreement or instrument that is a QFC (such support, “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd‑Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of Nebraska and/or of the United States or any other state of the United States):

 

In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.

 

 

As used in this Section 18, the following terms have the following meanings:

 

“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

 

“Covered Entity” means any of the following: (A) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b); (B) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or (C) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

 

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

 

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

 

[SIGNATURE PAGE FOLLOWS]

 

   

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the day and year first above written.

 

FIF AIREBEAM LLC FIF ST. GEORGE, LLC FIF UTAH LLC, as the Borrower	FIRST NATIONAL BANK OF OMAHA, as the Lender
By:/s/ Joseph M. Meisinger	By: /s/ Kara Geweke
Name: Joseph M. Meisinger	Name: Kara Geweke
Title: Authorized Signatory	Title: Director

 

 

[Signature Page to Credit Agreement]

 

Exhibit 10.2

 

FORM OF TERM NOTE               

 

 

 

(Term Loans)

 

$[___________]                                                                September [__], 2024

 

FOR VALUE RECEIVED, the undersigned (whether one or more, the “Borrower”), hereby jointly and severally promises to pay to FIRST NATIONAL BANK OF OMAHA or its permitted assigns (the “Lender”), in accordance with the provisions of the Agreement (as hereinafter defined), the Term Loan in the original principal amount of $[___________________] (as such loan is further described and defined in the Agreement) made by the Lender to the Borrower under that certain Credit Agreement, dated as of September 17, 2024 (as amended, restated, extended, supplemented or otherwise modified in writing from time to time, the “Agreement;” the terms defined therein being used herein as therein defined), between the Borrower and the Lender

 

The Borrower jointly and severally promises to pay the outstanding principal amount of the Term Loan evidenced by this Note and interest thereon from the date such Term Loan is advanced until such principal amount is paid in full, at such rates and at such times as provided in the Agreement. All payments of principal and interest shall be made to the Lender in Dollars in immediately available funds. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the per annum rate set forth in the Agreement.

 

This Note is one of the notes referred to in the Agreement, is entitled to the benefits thereof and may be prepaid in whole or in part subject to the terms and conditions provided therein. This Note is also entitled to the benefits of the Guaranty and is secured by the Collateral. Upon the occurrence and continuation of one or more of the Events of Default, beyond any applicable notice and cure period, specified in the Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Agreement. The Term Loan held by the Lender shall be evidenced by one or more loan accounts or records maintained by the Lender in the ordinary course of business. The Lender may also attach schedules to this Note and endorse thereon the date, amount and maturity of the Term Loan and payments with respect thereto.

 

The Borrower, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note.

 

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEBRASKA.

 

[SIGNATURE PAGE FOLLOWS]

 

 

 

IN WITNESS WHEREOF, the Borrower has caused this Note to be duly executed and delivered by its authorized officer as of the day and year first above written.

 

FIF AIREBEAM LLC

FIF ST. GEORGE, LLC

FIF UTAH LLC

By:                                                                        
Name:                                                                        
Title:                                                                        

 

 

 

Exhibit 10.3

 

SECURITY AGREEMENT

 

This SECURITY AGREEMENT, dated as of September 17, 2024 (this “Agreement”), by and among FIF AIREBEAM LLC, a Delaware limited liability company, FIF ST. GEORGE, LLC (d/b/a InfoWest), a Delaware limited liability company, and FIF UTAH LLC (d/b/a Utah Broadband), a Delaware limited liability company (whether, one or more, individually and collectively, the “Borrower”), BOSTON OMAHA BROADBAND, LLC, a Delaware limited liability company (the “Guarantor”), CERTAIN SUBSIDIARIES OF THE BORROWER OR THE GUARANTOR FROM TIME TO TIME PARTY HERETO (the “Subsidiary Grantors” and, collectively with Borrower and the Guarantor, the “Grantors”) and FIRST NATIONAL BANK OF OMAHA, a national banking association (the “Lender”).

 

RECITALS

 

WHEREAS, reference is made to that certain Credit Agreement, dated as of the date hereof (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) between the Borrower and the Lender, pursuant to which the Lender has agreed, subject to the terms and conditions contained therein, to provide certain financial accommodations to the Borrower.

 

In order to induce the Lender to provide or continue to provide the financial accommodations described in the Credit Agreement, the Grantors have agreed to pledge and grant a security interest to the Lender in the Collateral (as hereinafter defined);

 

NOW, THEREFORE, for value and in consideration of the premises and the agreements, provisions and covenants herein contained, each Grantor and the Lender agree as follows:

 

Section 1.    Definitions and Interpretations.

 

1.1.         General Definitions. In this Agreement, the following terms shall have the following meanings:

 

“Account Debtor” shall mean each Person that is obligated on a Receivable or any Supporting Obligation related thereto.

 

“Accounts” shall mean all “accounts” as such term is defined in Article 9 of the UCC, whether now owned or hereafter acquired.

 

“Additional Grantors” shall have the meaning assigned to such term in Section 5.2.

 

“Agreement” shall have the meaning set forth in the preamble hereto.

 

“Bankruptcy Code” shall mean Title 11 of the United States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.

 

“Borrower” shall have the meaning set forth in the preamble hereto.

 

“Cash Proceeds” shall mean all Proceeds of any Collateral received by any Grantor consisting of cash and checks.

 

“Chattel Paper” shall mean all “chattel paper” as such term is defined in Article 9 of the UCC, including all “electronic chattel paper” and all “tangible chattel paper,” as each such term is defined in Article 9 of the UCC.

 

“Collateral” shall have the meaning assigned to such term in Section 2.1.

 

“Collateral Documents” shall mean this Agreement and the other Security Documents executed and delivered pursuant to the Credit Agreement or any of the foregoing, as the same may be amended, restated, amended and restated, supplemented or otherwise modified from time to time, pursuant to which Collateral is pledged, assigned or granted to or on behalf of the Lender or notice of such pledge, assignment or grant is given.

 

“Collateral Support” shall mean all property (real or personal) assigned, hypothecated or otherwise securing any Collateral and shall include any security agreement or other agreement granting a lien or security interest in such real or personal property.

 

“Commercial Tort Claims” shall mean all “commercial tort claims” as such term is defined in Article 9 of the UCC asserted by any Grantor or in which any Grantor has any rights, including all commercial tort claims listed on Schedule 5 hereto.

 

“Copyrights” shall mean all United States and foreign copyrights (including community designs), whether now or hereafter owned by or exclusively licensed to any Grantor, including copyrights in Software and databases, and all Mask Works (as defined under 17 U.S.C. 901 of the U.S. Copyright Act), whether registered or not registered, and, with respect to any and all of the foregoing: (i) all registrations and applications therefor, including registrations and applications referred to on Schedule 3(b) hereto, (ii) all extensions and renewals thereof, (iii) all rights corresponding thereto throughout the world, (iv) all rights to sue for past, present and future infringements thereof, and (v) all Proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages and proceeds of suit.

 

“Credit Agreement” shall have the meaning set forth in the recitals hereto.

 

“Deposit Accounts” (i) shall mean all “deposit accounts” as such term is defined in Article 9 of the UCC and (ii) shall include all deposit accounts listed on Schedule 7 hereto.

 

“Documents” shall mean all “documents” as such term is defined in Article 9 of the UCC.

 

“Equipment” shall mean all “equipment” as such term is defined in Article 9 of the UCC.

 

“Excluded Accounts” shall mean deposit accounts and securities accounts solely to the extent constituting (i) payroll and other employee wage and benefit accounts, (ii) tax accounts (including sales tax accounts), (iii) escrow accounts, (iv) fiduciary or trust accounts and (v) zero balance accounts.

 

 

“Excluded Assets” shall have the meaning given to such term in Section 2.2(a).

 

“Federal Assignment of Claims Act” shall mean the Federal Assignment of Claims Act of 1940, as in effect from time to time (31 U.S.C. Section 3727 et seq. and 41 U.S.C. Sub-Section 15 et seq.).

 

“General Intangibles” (i) shall mean all “general intangibles” as such term is defined in Article 9 of the UCC, including “payment intangibles” also as such term is defined in Article 9 of the UCC, and (ii) shall include all interest rate or currency protection or hedging arrangements, all tax refunds, all licenses, permits, concessions and authorizations and all Intellectual Property (in each case, regardless of whether characterized as general intangibles under the UCC).

 

“Goods” (i) shall mean all “goods” as such term is defined in Article 9 of the UCC and (ii) shall include all Inventory and Equipment (in each case, regardless of whether characterized as goods under the UCC).

 

“Governmental Authority Account Debtor” shall have the meaning given to such term in Section 4.2(a)(ii).

 

“Grantor” shall have the meaning set forth in the preamble hereto.

 

“Guarantor” shall have the meaning set forth in the preamble hereto.

 

“Insolvency Proceeding” shall mean: (a) any voluntary or involuntary petition, case or proceeding under the Bankruptcy Code with respect to any Grantor; (b) any other voluntary or involuntary insolvency or bankruptcy petition, case or proceeding, or any similar petition, case or proceeding (including receiverships, liquidations, reorganizations or recapitalizations) under any applicable bankruptcy, insolvency or other similar law with respect to any Grantor or with respect to a material portion of its assets or the claims of its creditors; (c) the admission in writing by any Grantor of its inability to pay its debts generally as they become due; (d) any liquidation, dissolution, or winding up of any Grantor whether voluntary or involuntary and whether or not involving insolvency or bankruptcy; or (e) any assignment for the benefit of creditors or any other marshaling of assets and liabilities for creditors of any Grantor or other similar arrangement in respect of such Grantor’s creditors generally.

 

“Instruments” shall mean all “instruments” as such term is defined in Article 9 of the UCC.

 

“Intellectual Property” shall mean, collectively, the Software, the Copyrights, the Patents, the Trademarks and the Trade Secrets.

 

“Inventory” shall mean (i) all “inventory” as such term is defined in Article 9 of the UCC and (ii) (a) all goods held for sale or lease or to be furnished under contracts of service or so leased or furnished, all raw materials, work in process, finished goods, and materials used or consumed in the manufacture, packing, shipping, advertising, selling, leasing, furnishing or production of such inventory or otherwise used or consumed in any Grantor’s business, (b) all goods in which any Grantor has an interest in mass or a joint or other interest or right of any kind, (c) all goods which are returned to or repossessed by any Grantor, (d) all computer programs embedded in any goods and (e) all accessions and products of the foregoing (in each case, regardless of whether characterized as inventory under the UCC).

 

 

“Investment Related Property” shall mean (i) all “investment property” (as such term is defined in Article 9 of the UCC) and (ii) all Pledged Equity Interests, Pledged Debt, Deposit Accounts and certificates of deposit (in each case, regardless of whether classified as investment property under the UCC).

 

“Lender” shall have the meaning set forth in the preamble hereto.

 

“Letter-of-Credit Right” shall mean “letter-of-credit right” as such term is defined in Article 9 of the UCC.

 

“Margin Stock” shall have the meaning assigned to such term in Regulation U of the Board of Governors of the Federal Reserve System.

 

“Patents” shall mean all patents (whether United States or foreign) in or to which any Grantor now has or hereafter has any right, title or interest therein and certificates of invention, or similar industrial property rights, and applications for any of the foregoing, including: (i) each patent and patent application listed on Schedule 3(c) hereto, (ii) all reissues, divisions, continuations (including continuations in-part and improvements thereof), extensions, renewals, and reexaminations thereof, (iii) all rights corresponding thereto throughout the world, (iv) all inventions, discoveries, designs and improvements described therein, (v) all rights to sue for past, present and future infringements thereof, (vi) all licenses, claims, damages, and proceeds of suit arising therefrom, and (vii) all Proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages, and proceeds of suit.

 

“Permitted Sales” shall mean sales, transfers or assignments permitted by the Credit Agreement.

 

“Pledged Debt” shall mean all indebtedness owed to a Grantor, including all indebtedness described on Schedule 4(b) hereto, issued by the obligors named therein, the instruments evidencing such indebtedness, and all interest, cash, instruments and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such indebtedness.

 

“Pledged Equity Interests” shall mean all Pledged Stock, Pledged LLC Interests, Pledged Partnership Interests, Pledged Trust Interests and all other ownership interests owned by any Grantor in any Person and all rights and privileges of any Grantor with respect to any of the foregoing.

 

“Pledged LLC Interests” shall mean all interests in any limited liability company owned by a Grantor, including all limited liability company interests listed on Schedule 4(a) hereto, and all certificates, if any, representing such limited liability company interests and any interest of a Grantor on the books and records of such limited liability company or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such limited liability company interests.

 

 

“Pledged Partnership Interests” shall mean all interests in any general partnership, limited partnership, limited liability partnership or other partnership owned by a Grantor, including all partnership interests listed on Schedule 4(a) hereto, and all certificates, if any, representing such partnership interests and any interest of a Grantor on the books and records of such partnership or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such partnership interests.

 

“Pledged Stock” shall mean all shares of capital stock owned by a Grantor, including all shares of capital stock listed on Schedule 4(a) hereto, and all certificates, if any, representing such shares and any interest of a Grantor in the entries on the books of the issuer of such shares or on the books of any securities intermediary pertaining to such shares, and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such shares.

 

“Pledged Trust Interests” shall mean all interests in a Delaware business trust or other trust owned (whether legally or beneficially) by a Grantor, including all trust interests listed on Schedule 4(a) hereto, and all certificates, if any, representing such trust interests and any interest of a Grantor on the books and records of such trust or on the books and records of any securities intermediary pertaining to such interest and all dividends, distributions, cash, warrants, rights, options, instruments, securities and other property or proceeds from time to time received, receivable or otherwise distributed in respect of or in exchange for any or all of such trust interests.

 

“Proceeds” shall mean all “proceeds” as such term is defined in Article 9 of the UCC and, in any event, shall also include (i) any and all proceeds of any insurance, indemnity, warranty or guaranty payable to the Lender or any Grantor from time to time with respect to any of the Collateral, (ii) any and all payments (in any form whatsoever) made or due and payable to any Grantor from time to time in connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any Governmental Authority (or any Person acting under color of any Governmental Authority), (iii) payments or distributions made with respect to any Investment Related Property, (iv) whatever is receivable or received when Collateral or proceeds are sold, leased, licensed, exchanged, collected or otherwise disposed of, whether such disposition is voluntary or involuntary and (v) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral.

 

“Receivables” shall mean all rights to receive payment, whether or not earned by performance, for goods or other property sold, leased, licensed, assigned or otherwise disposed of, or services rendered or to be rendered, including all such rights constituting or evidenced by any Account, Chattel Paper, Instrument, General Intangible or Investment Related Property, together with all of a Grantor’s rights, if any, in any goods or other property giving rise to such right to payment and all Collateral Support and Supporting Obligations related thereto and all Receivables Records.

 

 

“Receivables Records” shall mean (i) all original copies of all documents, instruments or other writings or electronic records or other Records evidencing any Receivables, (ii) all books, correspondence, credit or other files, Records, ledger sheets or cards, invoices, and other papers relating to Receivables, including all tapes, cards, computer tapes, computer discs, computer runs, record keeping systems and other papers and documents relating to any Receivables, whether in the possession or under the control of a Grantor or any computer bureau or agent from time to time acting for a Grantor or otherwise, (iii) all evidences of the filing of financing statements and the registration of other instruments in connection therewith, and amendments, supplements or other modifications thereto, notices to other creditors or secured parties, and certificates, acknowledgments, or other writings, including lien search reports, from filing or other registration officers, (iv) all credit information, reports and memoranda relating thereto and (v) all other written or non-written forms of information related in any way to the foregoing or any Receivable.

 

“Record” shall have the meaning of “record” as such term is defined in Article 9 of the UCC.

 

“Secured Obligations” shall mean all the Obligations of each Grantor, including (i) in the case of any Grantor that is a Guarantor, its obligations and indebtedness under its Guaranty, (ii) any and all sums advanced by the Lender in order to preserve the Collateral or preserve its security interest in the Collateral and (iii) in the event of any proceeding for the collection or enforcement of any Obligations of any Grantor, the reasonable expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Lender of its rights hereunder, together with reasonable and documented out-of-pocket attorneys’ fees and expenses and court costs; it being acknowledged and agreed that the “Secured Obligations” shall include extensions of credit or incurrence of indebtedness of the types described above, whether outstanding on the date of this Agreement or extended or incurred from time to time after the date of this Agreement.

 

“Securities” shall mean all “securities” as such term is defined in Article 8 of the UCC, any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit sharing agreement or arrangement, options, warrants, bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing.

 

“Software” shall mean computer programs, object code, source code and supporting documentation, including “software” as such term is defined in the UCC, and computer programs that may be construed as included in the definition of “goods” in the UCC, all licensed rights to the foregoing, and all media on which any such programs, code, documentation or associated data may be stored.

 

“Subsidiary Grantor” shall have the meaning set forth in the preamble hereto.

 

 

“Supplement” shall mean any supplement to this Agreement in substantially the form of Exhibit A attached hereto.

 

“Supporting Obligation” shall mean all “supporting obligations” as such term is defined in Article 9 of the UCC.

 

“Trade Secrets” shall mean all trade secrets and all other confidential or proprietary information and know-how in which any Grantor now has or hereafter has any right, title or interest therein, whether or not any of the foregoing has been reduced to a writing or other tangible form, including all documents and things embodying, incorporating, or referring in any way to any of the foregoing, including: (i) any secretly held existing engineering or other data, information, production procedures and other know-how relating to the design manufacture, assembly, installation, use, operation, marketing, sale and/or servicing of any products or business of any Grantor worldwide, (ii) the right to sue for past, present and future misappropriation or other violation thereof and (iii) all Proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages, and proceeds of suit.

 

“Trademarks” shall mean all United States and foreign trademarks, trade names, corporate names, company names, business names, fictitious business names, Internet domain names, service marks, certification marks, collective marks, logos, trade dress, other source or business identifiers, designs and general intangibles of a like nature, and all registrations and applications for any of the foregoing in which any Grantor now has or hereafter has any right, title or interest, including: (i) the registrations and applications referred to in hereto, (ii) all extensions or renewals of any of the foregoing, (iii) all of the goodwill of the business connected with the use of and symbolized by the foregoing, (iv) the right to sue for past, present and future infringement or dilution of or unfair competition with any of the foregoing or for any injury to goodwill, and (v) all Proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages, and proceeds of suit.

 

1.2.    Definitions; Interpretation. Capitalized terms used herein (including the preamble and recitals hereto) and not otherwise defined herein shall have the respective meanings ascribed thereto in the Credit Agreement. Capitalized terms used herein (including the preamble and recitals hereto) and not otherwise defined herein or in the Credit Agreement shall have the meanings ascribed thereto in the Uniform Commercial Code as in effect from time to time in the State of Nebraska.

 

Section 2.    Grant of Security.

 

2.1.    Grant of Security. Subject to Section 2.2(a), as security for the payment and performance in full of the Secured Obligations, each Grantor hereby creates and grants to the Lender, its successors and assigns, a continuing lien on and security interest in all of such Grantor’s right, title and interest in, to and under all of the following property of such Grantor, in each case whether now or hereafter existing or in which any Grantor now has or hereafter acquires any right, title or interest and wherever the same may be located (all of which being hereinafter collectively referred to as the “Collateral”): all Accounts; all Goods, including Equipment and Fixtures; all Inventory; all Documents, Instruments and Chattel Paper; all Letter-of-Credit Rights; all Investment Related Property; all Intellectual Property; all the Commercial Tort Claims described on Schedule 5 hereto; all General Intangibles; all money and all Deposit Accounts; all Supporting Obligations; all books and records relating to the Collateral; all Receivables; and all Proceeds, including Cash Proceeds, and products of any of the foregoing and all accessions to, substitutions and replacements for any of the foregoing.

 

 

2.2.    Certain Limited Exclusions.

 

(a)    Notwithstanding anything herein to the contrary, in no event shall the term “Collateral” include or the liens and security interests granted under Section 2.1 attach to: (i) any leasehold interests in real property as lessee; (ii) any property or asset to the extent that the grant of a security interest in such property or asset is prohibited by any applicable law or requires a consent not obtained of any Governmental Authority pursuant to applicable law (other than, in each case, to the extent that any such prohibition or requirement would be rendered ineffective pursuant to Section 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provisions) of any relevant jurisdiction or any other applicable law (including Title 11 of the United States Code) or principles of equity and other than any Receivables and Proceeds thereof the assignment of which is expressly deemed effective under the UCC or other applicable law notwithstanding such prohibition or requirement); (iii) any Trademark or service mark consisting of an “intent to use” application until such time as an amendment to allege use in respect thereof has been accepted by the United States Patent and Trademark Office, at which time such Trademark or service mark shall cease to be excluded from the Collateral under this Section 2.2(a); (iv) any property to the extent that the creation or perfection of, pledges of, or security interests in, such property would reasonably be expected to result in material adverse tax consequences to Guarantor and its Subsidiaries as a result of the operation of Section 956 of the Code; (v) property of and Equity Interests in any Person (other than a Loan Party or a wholly-owned Subsidiary of a Loan Party) to the extent a security interest is not permitted to be granted by the terms of such Person’s organizational documents or joint venture documents; (vi) leases, licenses or permits or agreements (including with respect to any purchase money Indebtedness or similar arrangements) to the extent that, and so long as, a grant of a security interest therein, or in the property or assets that secure the underlying obligations with respect thereto (a) is prohibited by applicable law, (b) would violate or invalidate such lease, license, permit or agreement, or create a right of termination in favor of, or required the consent of, any other party thereto (other than such applicable Grantor and its Subsidiaries) (in each case, after giving effect to the relevant provisions of the UCC or other applicable laws), or (c) would cause such lease, license, permit or agreement to be terminated pursuant to any “change in control” or similar provisions contained therein, in each case, other than the proceeds thereof; (vii) Excluded Accounts; and (viii) any property if, and for so long as, in each case, reasonably agreed by the Lender and the Grantors, the cost of creating or perfecting such pledges or security interests in such asset exceeds the practical benefits to be obtained by the Lender therefrom (the assets referred to in clauses (i) through (viii) above shall, subject to the proviso below, be collectively referred to as the “Excluded Assets”);

 

provided that (A) Excluded Assets will not include any Proceeds, substitutions or replacements of any Excluded Assets referred to in clauses (i) through (viii) above unless such Proceeds, substitutions or replacements would constitute Excluded Assets referred to in such clauses (i) through (viii); and (B) if and when any property that would constitute Collateral but for the provisions of this Section 2.2(a) shall cease to be an Excluded Asset, such property shall automatically constitute Collateral and, without any further action, each applicable provision of this Agreement, including the grant of liens and security interests pursuant to Section 2.1, shall automatically apply to such property.

 

 

(b)    Notwithstanding anything to the contrary in this Agreement, to the extent any provision of this Agreement or the Credit Agreement excludes any assets from the scope of the Collateral, or from any requirement to take any action to perfect any security interest in favor of the Lender in any Collateral, the representations, warranties and covenants made by the Grantors in this Agreement or the Credit Agreement with respect to the creation, perfection or priority (as applicable) of the security interest in the Collateral granted in favor of the Lender shall be deemed not to apply to such assets (if such asset is an Excluded Asset) or shall be deemed to be modified as appropriate to give effect to such exclusion, as applicable.

 

Section 3.    Security for Obligations; Grantors Remain Liable.

 

3.1.    Security for Secured Obligations. This Agreement secures, and the Collateral is collateral security for, the prompt and complete payment and performance in full when due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including the interest and fees accruing during the pendency of any bankruptcy, insolvency, receivership, or other similar proceeding, regardless of whether allowed or allowable in such proceeding, and the payment of amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code (and any successor provision thereof)), of all Secured Obligations.

 

3.2.    Continuing Liability Under Collateral. Notwithstanding anything herein to the contrary, (i) each Grantor shall remain liable for all obligations under the Collateral unless released from such obligations in accordance with the Loan Documents and nothing contained herein is intended or shall be a delegation of duties to the Lender, (ii) each Grantor shall remain liable under each of the agreements included in the Collateral, including any agreements relating to Pledged Partnership Interests or Pledged LLC Interests, to perform in all respects all of the obligations undertaken by it thereunder all in accordance with and pursuant to the terms and provisions thereof and the Lender shall not have any obligation or liability under any of such agreements by reason of or arising out of this Agreement or any other document related thereto the Lender shall not have any obligation to make any inquiry as to the nature or sufficiency of any payment received by it or have any obligation to take any action to collect or enforce any rights under any agreement included in the Collateral, including any agreements relating to Pledged Partnership Interests or Pledged LLC Interests, and (iii) the exercise by the Lender of any of its rights hereunder shall not release any Grantor from any of its duties or obligations under the contracts and agreements included in the Collateral.

 

Section 4.    Representations and Warranties and Covenants.

 

 

4.1.    Generally.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants that: (i) it owns the Collateral purported to be owned by it or otherwise has the rights it purports to have in each item of Collateral and, as to all Collateral, whether now existing or hereafter acquired, will continue to own or have such rights in each item of the Collateral, free and clear of any and all Liens, rights or claims of all other Persons, other than Permitted Encumbrances and Liens permitted by the Credit Agreement (such Liens, “Permitted Liens”); (ii) upon the proper filing of all UCC financing statements naming each Grantor as “debtor” and the Lender as “secured party” and describing the Collateral (which description may use the terms “all assets” or similar expressions) in the filing offices set forth opposite such Grantor’s name in Schedule 1(a) hereto, the security interests granted to the Lender in the Collateral hereunder will constitute valid and perfected first priority Liens for the benefit of the Lender (subject in priority only to Permitted Liens that have priority as a matter of contract or law), in each case to the extent that such security interests can be perfected under the UCC by the filing of a financing statement; (iii) all actions, filings, notices, registrations and recordings within the United States and all material consents, in each case as are necessary for the exercise by the Lender of the voting or other rights provided for in this Agreement or the exercise of remedies, , in respect of the Collateral have been taken, made or obtained except where failure to do so would not reasonably be expected to have a Material Adverse Effect; (iv) all information supplied by any Grantor with respect to any of the Collateral (including, without limitation, the information set forth on the Schedules to this Agreement) is accurate and complete in all material respects; (v) none of the Collateral constitutes, or is the Proceeds of, “farm products” (as defined in the UCC); (vi) it does not own any “as extracted collateral” (as defined in the UCC) or any timber to be cut; and (vii) such Grantor has been duly organized as an entity of the type set forth opposite such Grantor’s name on Schedule 1(a) hereto solely under the laws of the jurisdiction set forth opposite such Grantor’s name on Schedule 1(a) hereto and remains duly existing as such. Such Grantor has not filed any certificates of domestication, transfer or continuance in any other jurisdiction.

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees that: (i) except for the security interest created by this Agreement, it shall not create or suffer to exist any Lien upon or with respect to any of the Collateral, except Permitted Liens, and such Grantor shall defend the Collateral against all Persons at any time claiming any interest therein (other than any such claim with respect to Permitted Liens); (ii) it shall not produce, use, expressly permit or otherwise permit (to its knowledge) any Collateral to be used (A) in violation of any provision of this Agreement or (B) in any respect unlawfully or in violation of any applicable statute, regulation or ordinance or any policy of insurance covering the Collateral in any material respect; (iii) except as expressly permitted by the Credit Agreement, it shall not change such Grantor’s name, corporate structure (e.g., by merger, consolidation, change in corporate form or otherwise), type of organization, jurisdiction of organization, principal place of business or chief executive office; provided that to the extent such Grantor takes any such action it shall promptly notify the Lender thereof and shall take such actions and deliver such documents as the Lender shall reasonably request to maintain the continuous validity, perfection and priority of the Lender’s security interest in the Collateral; (iv) it shall not take or permit any action which could reasonably be expected to impair the Lender’s rights in the Collateral; and (v) it shall not sell, transfer or assign (by operation of law or otherwise) any Collateral except for Permitted Sales.

 

4.2.    Receivables.

 

(a)    Representations and Warranties. Each Grantor represents and warrants that: (i) each Receivable arose from bona fide transactions in the ordinary course of business; (ii) with respect to any Receivable with the government of the United States, any agency or instrumentality thereof, any state or municipality or any foreign sovereign (collectively, the “Governmental Authority Account Debtors”), each applicable Grantor, has, if requested by the Lender, complied with the Federal Assignment of Claims Act or any applicable statute or municipal ordinance of similar purpose and effect; (iii) no Receivable requires the consent of the Account Debtor in respect thereof in connection with the pledge hereunder, except any consent which has been obtained; and (iv) no Receivable is evidenced by, or constitutes, an Instrument or Chattel Paper which has not been delivered to, or otherwise subjected to the control of, the Lender, to the extent required by, and in accordance with, this Agreement.

 

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees that: (i) it shall keep and maintain at its own cost and expense accurate and complete records of the Receivables as are customarily maintained under similar circumstances by Persons of established reputation engaged in similar businesses; (ii) it shall mark conspicuously (in a form and manner reasonably satisfactory to the Lender) all Chattel Paper and Instruments evidencing Receivables (other than any delivered to the Lender as provided herein), with an appropriate reference to the fact that each of the Lender has a security interest therein; (iii) it shall perform in all material respects all of its obligations with respect to the Receivables; (iv) other than in the ordinary course of business consistent with prudent business practices or as permitted by the Credit Agreement, it shall not amend, modify, terminate or waive any provision of any Receivable in any manner which could reasonably be expected to have a Material Adverse Effect. Other than in the ordinary course of business, after the occurrence and during the continuation of an Event of Default, such Grantor shall not (1) grant any extension or renewal of the time of payment of any Receivable, (2) compromise or settle any dispute, claim or legal proceeding with respect to any Receivable for less than the total unpaid balance thereof, (3) release, wholly or partially, any Person liable for the payment thereof, or (4) allow any credit or discount thereon. The Lender may (a) at any time following the occurrence and during the continuance of an Event of Default beyond all applicable notice and cure periods (1) direct the Account Debtors under any Receivables to make payment of all amounts due or to become due to such Grantor thereunder directly to the Lender and (2) enforce, at the expense of such Grantor, collection of any such Receivables and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done and (b) at any time after the occurrence and during the continuance of an Event of Default, notify, or require any Grantor to notify, each Person maintaining a lockbox or similar arrangement to which Account Debtors under any Receivables have been directed to make payment to remit all amounts representing collections on checks and other payment items from time to time sent to or deposited in such lockbox or other arrangement directly to the Lender. If the Lender notifies any Grantor that it has elected to collect the Receivables in accordance with the preceding sentence, any payments of Receivables received by such Grantor shall be promptly deposited by such Grantor in the exact form received, duly indorsed by such Grantor to the Lender, in a Deposit Account that is subject to a deposit account control agreement, and until so turned over, all amounts and proceeds (including checks and other instruments) received by such Grantor in respect of the Receivables, any Supporting Obligation or Collateral Support shall be received in trust for the benefit of the Lender hereunder and shall be segregated from other funds of such Grantor and such Grantor shall not adjust, settle or compromise the amount or payment of any Receivable, or release wholly or partly any Account Debtor or obligor thereof, or allow any credit or discount thereon.

 

(c)    Delivery and Control of Receivables. With respect to any Receivable that is evidenced by, or constitutes, Chattel Paper or Instruments, upon the reasonable request of Lender, each Grantor shall promptly cause each originally executed copy thereof to be delivered to the Lender (or its agent or designee) appropriately indorsed to the Lender or indorsed in blank. With respect to any Receivable which would constitute “electronic chattel paper” under Article 9 of the UCC, each Grantor, shall, upon the request of Lender, use commercially reasonable efforts to give the Lender control over such Receivables (within the meaning of Section 9-105 of the UCC).

 

 

4.3.    Investment Related Property.

 

4.3.1.    Investment Related Property Generally.

 

(a)    Covenants and Agreements. Each Grantor hereby covenants and agrees that:

 

(i)    in the event it acquires rights in any Pledged Equity Interests or any Pledged Debt that is evidenced by a promissory note, Chattel Paper or any similar evidences of Indebtedness for which the principal amount thereof or the obligations evidenced thereunder are, in the aggregate, in excess of $500,000 after the date hereof, it shall promptly deliver to the Lender, a completed Pledge Supplement together with all applicable supplements to Schedules thereto, reflecting such new Investment Related Property. Notwithstanding the foregoing, it is understood and agreed that the applicable security interest of the Lender shall attach to all Investment Related Property immediately upon any Grantor’s acquisition of rights therein and shall not be affected by the failure of any Grantor to deliver a Supplement as required hereby;

 

(ii)    except as provided in the next sentence, in the event such Grantor receives any dividends, interest or distributions on any Investment Related Property, or any securities or other property upon the merger, consolidation, liquidation or dissolution of any issuer of any Investment Related Property, then (a) such dividends, interest or distributions and securities or other property shall be included in the definition of Collateral without further action and (b) such Grantor shall, promptly take all steps reasonably necessary or otherwise reasonably requested by the Lender to ensure the validity, perfection and priority of the security interest purported to be granted hereby to the Lender in such Investment Related Property, and the control of the Lender over such Investment Related Property (including delivery thereof to the Lender), and pending any such action such Grantor shall be deemed to hold such dividends, interest, distributions, securities or other property in trust for the benefit of the Lender and shall segregate such dividends, distributions, Securities or other property from all other property of such Grantor. Notwithstanding the foregoing, so long as no Event of Default shall have occurred and be continuing and the Lender has not instructed the Grantors in writing otherwise, the Lender authorizes each Grantor to retain all cash dividends and distributions and all payments of interest; and

 

(iii)    each Grantor consents to the grant by each other Grantor of a security interest in all Investment Related Property to the Lender.

 

(b)    Delivery and Control. Each Grantor agrees that (A) with respect to (x) any Investment Related Property in which it currently has rights, it shall comply with the provisions of this Section 4.3.1(b) on or before the Closing Date and (B) with respect to (x) any Investment Related Property hereafter acquired by such Grantor it shall comply with the provisions of this Section 4.3.1(b) promptly upon acquiring rights therein. With respect to any such Investment Related Property that is represented by a certificate or that is an “instrument” it shall cause such certificate or instrument to be delivered to the Lender, indorsed in blank by an “effective indorsement” (as defined in Section 8-107 of the UCC), regardless of whether such certificate constitutes a “certificated security” for purposes of the UCC.

 

 

(c)    Voting and Distributions.

 

(i)    So long as no Event of Default shall have occurred and be continuing beyond all applicable notice and cure periods: (1) except as otherwise provided under the covenants and agreements relating to Investment Related Property in this Agreement or the Credit Agreement, each Grantor shall be entitled to exercise or refrain from exercising any and all voting and other consensual rights pertaining to the Investment Related Property or any part thereof for any purpose not inconsistent with the terms of this Agreement or the Credit Agreement; and (2) the Lender shall promptly execute and deliver (or cause to be executed and delivered) to each Grantor all proxies, and other instruments as such Grantor may from time to time reasonably request in writing for the purpose of enabling such Grantor to exercise the voting and other consensual rights when and to the extent which it is entitled to exercise pursuant to clause (1) above.

 

(ii)    After the occurrence and during the continuance of an Event of Default beyond all applicable notice and cure periods: (A) upon written notice from the Lender, all rights of each Grantor to exercise or refrain from exercising the voting and other consensual rights which it would otherwise be entitled to exercise pursuant hereto shall cease and all such rights shall thereupon become vested in the Lender who shall thereupon have the right to exercise such voting and other consensual rights; (B) all rights of each Grantor to receive dividends, interest, distributions, Securities or other property that such Grantor is authorized to receive pursuant to this Section 4.3.1 shall cease, and all such rights shall thereupon become vested in the Lender who shall have the sole and exclusive right and authority to receive and retain such dividends, interest or distribution. Each Grantor shall be deemed to hold any such dividends, interest, distributions, securities or other property received during such period in trust for the benefit of the Lender and shall segregate such dividends, distributions, Securities or other property from all other property of such Grantor. Any and all monies and other property paid over to or received by the Lender pursuant to the provisions of this paragraph (B) shall be retained by the Lender in an account to be established by the Lender and shall be applied in accordance with the provisions of this Agreement; and (C) (1) upon written request of the Lender, each Grantor shall promptly execute and deliver (or cause to be executed and delivered) to the Lender all proxies, dividend payment orders and other instruments as shall be necessary to permit the Lender to exercise the voting and other consensual rights which it may be entitled to exercise pursuant hereto, and to receive all dividends and other distributions which it may be entitled to receive hereunder and (2) each Grantor acknowledges that the Lender may, utilize the power of attorney set forth in Section 6.1.

 

4.3.2.    Pledged Equity Interests.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants that:

 

(i)    Schedule 4(a) hereto sets forth all of the Pledged Stock, Pledged LLC Interests, Pledged Partnership Interests and Pledged Trust Interests owned by any Grantor and such Pledged Equity Interests constitute the percentage of issued and outstanding shares of stock, percentage of membership interests, percentage of partnership interests or percentage of beneficial interest of the respective issuers thereof indicated in such Section, all of which is true, accurate and complete;

 

 

(ii)    it is the record and beneficial owner of the Pledged Equity Interests described on Schedule 4(a) as held by it, free of all Liens, rights or claims of other Persons other than Permitted Liens;

 

(iii)    no material consent of any Person, including any other general or limited partner, any other member of a limited liability company, any other shareholder or any other trust beneficiary, is necessary in connection with the creation, perfection or first priority status (subject to Permitted Liens) of the security interest of the Lender in any Pledged Equity Interests or the exercise by the Lender of the voting or other rights provided for in this Agreement or the exercise of remedies in respect thereof, other than consents that have been obtained;

 

(iv)    none of the Pledged LLC Interests nor Pledged Partnership Interests issued by any Grantor or any Subsidiary thereof are or represent interests in issuers that (a) are registered as investment companies within the meaning of the Investment Company Act of 1940 or (b) are dealt in or traded on securities exchanges or markets; and

 

(v)    all of the Pledged Equity Interests existing on the date hereof have been, and to the extent any Pledged Equity Interests are hereafter issued, such Pledged Equity Interests will be, upon such issuance, duly authorized, validly issued and fully paid and non-assessable to the extent applicable.

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees that:

 

(i)    unless permitted under the Credit Agreement, without the prior written consent of the Lender, it shall not vote to enable or take any other action to (a) amend or terminate any partnership agreement, limited liability company agreement, certificate of incorporation, by-laws or other organizational documents in any way that adversely affects the validity, perfection or priority of the Lender’s security interest in the Collateral, except for Permitted Encumbrances and Permitted Sales, (b) permit any issuer of any Pledged Equity Interest that is a Grantor or a Subsidiary thereof to issue any additional stock, partnership interests, limited liability company interests or other equity interests of any nature or to issue securities convertible into or granting the right of purchase or exchange for any stock or other equity interest of any nature of such issuer unless such stock or interests are pledged hereunder to the extent required hereby, (c) permit any issuer of any Pledged Equity Interest that is a Subsidiary to dispose of all or a material portion of its assets in a transaction not constituting a Permitted Sale, (d) waive any default under or breach of any terms of any organizational document relating to the issuer of any Pledged Equity Interest or the terms of any Pledged Debt, or (e) cause or permit any Subsidiary of the Borrower that is an issuer of any Pledged Partnership Interests or Pledged LLC Interests which are not securities (for purposes of the UCC) to elect or otherwise take any action to cause such Pledged Partnership Interests or Pledged LLC Interests to be treated as securities for purposes of the UCC; and

 

 

(ii)    it consents to the grant by each other Grantor of a security interest in all Investment Related Property to the Lender and, without limiting the foregoing, following the occurrence and during the continuation of an Event of Default and consents to (x) the transfer of any Pledged Partnership Interest and any Pledged LLC Interest to the Lender or its nominee and (y) the substitution of the Lender or its nominee as a partner in any partnership or as a member in any limited liability company with all the rights and powers related thereto.

 

4.3.3.    Pledged Debt.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants that (i) Schedule 4(b) hereto sets forth all of the Pledged Debt owned by any that is evidenced by a promissory note, Chattel Paper or any similar evidences of Indebtedness for which the principal amount thereof or the obligations evidenced thereunder are, in the aggregate, in excess of $500,000, and (ii) all such Pledged Debt has been duly authorized, authenticated or issued, and delivered and is the legal, valid and binding obligation of the issuers thereof and is not in default and constitutes all of the issued and outstanding intercompany Indebtedness owned by such Grantor.

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees that it shall notify the Lender in writing of any default under any Pledged Debt.

 

4.3.4.    Deposit Accounts.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants that: (i) Schedule 7 hereto resets forth all of the Deposit Accounts in which each Grantor has an interest. Each Grantor is the sole account holder of each such Deposit Account and such Grantor has not consented to, and is not otherwise aware of, any Person (other than Lender pursuant to this Agreement and the applicable depository bank to the extent such depository bank is deemed to have “control” under applicable law) having either sole dominion and control (within the meaning of common law) or “control” (within the meanings of Section 9-104 of the UCC) over, or any other interest in, any such Deposit Account (other than Excluded Accounts) or any money or other property deposited therein; and (ii) each Grantor will use commercially reasonable efforts to take all actions reasonably requested by the Lender, to (a) establish the Lender’s “control” (within the meanings of Sections 8-106 and 9-106 of the UCC) over any portion of (x) the Investment Related Property in a Subsidiary and (x) the Investment Related Property in any issuer that is not a Subsidiary, in each case, constituting “certificated securities” (as defined in the UCC) and (b) deliver all Instruments.

 

4.4.    Intellectual Property.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants that: (i) Schedule 3 hereto sets forth a true and complete list of all registered Trademarks, registered Copyrights and registered Patents and all applications to register any of the foregoing owned by each Grantor; (ii) it is the sole owner of the entire right, title, and interest in and to all Intellectual Property listed on Schedule 3 hereto that it purports to own and owns or has the valid right to use Intellectual Property used in or necessary to conduct its business, free and clear of all Liens (other than Permitted Liens); and (iii) all registrations and applications of Copyrights, Patents and Trademarks purported to be owned by a Grantor are currently standing in the name of a Grantor’

 

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees as follows: (i) it shall not do any commercially unreasonable act or omit to do any commercially reasonable act whereby any of the Intellectual Property which, in its reasonable business judgment, is material to any line of business of the Grantors may lapse, or become abandoned, dedicated to the public, or unenforceable, or which would adversely affect the validity, grant, or enforceability of the security interest granted therein under this Agreement; (ii) it shall report to the Lender (i) its filing of any application to register any United States Patent, Trademark, or Copyright with the United States Patent and Trademark Office, the United States Copyright Office, or any state registry (whether such application is filed by such Grantor or through any agent, employee, licensee, or designee thereof), (ii) its acquisition of ownership of any United States Patent, Trademark or Copyright application or registration by purchase or assignment, and (iii) the registration of any United States Patent, Trademark or Copyright by any such office, in each case by executing and delivering to the Lender (A) a completed Supplement, together with all applicable supplements to Schedules thereto and (B) a grant of security in such Patent, Trademark or Copyright, in a form reasonably satisfactory to Lender, as applicable, within thirty (30) days of such submission, acquisition or registration, or as soon thereafter as is legally permissible, and promptly file such grant with the United States Patent and Trademark Office or the United States Copyright Office, as applicable; provided, that any Intellectual Property or rights therein acquired by any Grantor after the date hereof (other than Excluded Assets) shall constitute Collateral as if such would have constituted Collateral at the time of execution hereof and be subject to the lien and security interest created by this Agreement without further action by any party; (iii) it shall, promptly execute and deliver within thirty (30) days to the Lender at such Grantor’s expense, a certificate or other indicia of ownership where a registration of any United States Patent, Trademark or Copyright is issued hereafter as a result of any application now or hereafter pending, and execute, deliver and record any document required to acknowledge, confirm, register, record, or perfect the Lender’s security interest therein; (iv) it shall take all steps reasonably necessary to protect the secrecy of all Trade Secrets, including entering into confidentiality agreements with employees and labeling and restricting access to secret information and documents; and (v) it shall take all steps reasonably necessary to use proper statutory notice in connection with its use of any of the Intellectual Property.

 

4.5.    Commercial Tort Claims.

 

(a)    Representations and Warranties. Each Grantor hereby represents and warrants, that Schedule 5 hereto sets forth all Commercial Tort Claims of each Grantor; and

 

(b)    Covenants and Agreements. Each Grantor hereby covenants and agrees that with respect to any Commercial Tort Claim where the reasonably estimated value of which is, in the aggregate, in excess of $1,000,000, hereafter arising it shall promptly and in no event later than thirty (30) days (or such later date as agreed in writing by the Lender in its reasonable discretion) of it acquiring rights in such Commercial Tort Claims deliver to the Lender a completed Supplement, together with all applicable supplements to Schedules thereto, identifying such new Commercial Tort Claims and granting to the Lender a security interest therein and in the Proceeds thereof.

 

 

Section 5.    Further Assurances; Additional Grantors.

 

5.1.    Further Assurances.

 

(a)    Each Grantor agrees that from time to time, at the expense of such Grantor, it shall promptly execute and deliver all such instruments and documents, and take all such other action, that the Lender may reasonably request in order to create and/or maintain the validity, perfection or priority of any security interest granted hereby to the extent contemplated hereby, and it shall promptly execute and deliver all further instruments and documents, and take all further action, that the Lender may reasonably request in order to enable the Lender to exercise and enforce its rights and remedies hereunder or under any other Collateral Document with respect to any Collateral.

 

(b)    Each Grantor hereby authorizes, at such Grantor’s expense, the Lender to file a Record or Records, including financing or continuation statements, and amendments thereto, in any jurisdictions and with any filing offices as Lender may determine, in its reasonable discretion, are necessary to perfect the security interest granted to the Lender herein. Such financing statements may describe the Collateral in the same manner as described herein or may contain an indication or description of collateral that describes such property in any other manner as Lender may determine, in its sole discretion, is necessary, advisable or prudent to ensure the perfection of the security interest in the Collateral granted to the Lender herein, including describing such property as “all assets” or “all personal property, whether now owned or hereafter acquired” or words of similar description.

 

(c)    In addition, each Grantor, at such Grantor’s expense, hereby ratifies and approves the authorization of the Lender to file any financing statements with respect to the Collateral. In the event that the description of the Collateral in any such financing statement includes assets that do not constitute Collateral, the filing of such financing statement shall nonetheless be deemed authorized by such Grantor to the extent of the Collateral included in such description, and any such inaccuracy in such financing statement shall not render the financing statement ineffective as to any of the Collateral. Each Grantor, at such Grantor’s expense, irrevocably and unconditionally authorizes the Lender to adopt (but the Lender shall have no duty to adopt) on its behalf any symbol required for authenticating any electronic filing. Nothing contained herein shall be construed to in any manner limit any other authorization by any Grantor of the filing of financing statements by or on such Grantor’s behalf or for the benefit of the Lender.

 

5.2.    Additional Grantors. From time to time subsequent to the date hereof, to the extent required by the Loan Documents, additional Persons may become parties hereto as additional Grantors (each, an “Additional Grantor”), by executing a joinder to this Agreement in form and substance satisfactory to the Lender. Upon delivery of any such joinder to the Lender, notice of which is hereby waived by the Grantors, each Additional Grantor shall be a Grantor and shall be as fully a party hereto as if such Additional Grantor were an original signatory hereto. Each Grantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Grantor hereunder, nor by any election of the Lender not to cause any Subsidiary of Borrower to become an Additional Grantor hereunder. This Agreement shall be fully effective as to any Grantor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Grantor hereunder.

 

 

Section 6.    Lender Appointed Attorney-In-Fact.

 

6.1.    Power of Attorney. To the fullest extent permitted by law, each Grantor hereby irrevocably appoints the Lender (such appointment being coupled with an interest) as such Grantor’s attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor, the Lender or otherwise, from time to time, upon the occurrence and during the continuance of an Event of Default beyond all applicable notice and cure periods (or at any time in the cases of Section 6.1(e) and 6.1(f)), to take any action and to execute any instrument that the Lender may deem reasonably necessary or advisable to accomplish the purposes of this Agreement, the other Loan Documents, including the following: (a) to obtain and adjust insurance required to be maintained by such Grantor or paid to the Lender pursuant to the Credit Agreement; (b) to ask for, demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral; (c) to receive, endorse and collect any drafts or other instruments, documents and chattel paper in connection with clause (b); (d) to file any claims or take any action or institute any proceedings that the Lender may reasonably request for the collection of any of the Collateral or otherwise to enforce the rights of the Lender with respect to any of the Collateral; (e) to prepare and file any UCC financing statements or continuations thereof, or amendments thereto, against such Grantor as debtor; (f) to prepare, sign, and file for recordation in any intellectual property registry, appropriate evidence of the lien and security interest granted herein in the Intellectual Property in the name of such Grantor as debtor; (g) to take or cause to be taken all actions necessary to perform or comply or cause performance or compliance with the terms of this Agreement, including actions to pay or discharge taxes or Liens (other than Permitted Liens) levied or placed upon or threatened against the Collateral, the legality or validity thereof and the amounts necessary to discharge the same to be determined by the Lender in its sole discretion, any such payments made by the Lender to become obligations of such Grantor to the Lender, due and payable immediately without demand; and (h) generally to sell, transfer, pledge, make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Lender were the absolute owner thereof for all purposes, and to do, at the Lender’s option and such Grantor’s expense, at any time or from time to time, all acts and things that Lender deems reasonably necessary to protect, preserve or realize upon the Collateral and the Lender’s security interest therein in order to effect the intent of this Agreement, all as fully and effectively as such Grantor might do.

 

6.2.    No Duty on the Part of Lender. The powers conferred on the Lender hereunder are solely to protect the interests of the Lender in the Collateral and shall not impose any duty upon the Lender to exercise any such powers. The Lender shall be accountable only for amounts that they actually receive as a result of the exercise of such powers, and neither they nor any of their officers, directors, employees or agents shall be responsible to any Grantor for any act or failure to act hereunder, except for their own bad faith, material breach, gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final non-appealable judgment).

 

 

Section 7.    Remedies.

 

7.1.    Generally.

 

(a)    If any Event of Default shall have occurred and be continuing beyond all applicable notice and cure periods, the Lender may (but shall not be obligated to) exercise in respect of the Collateral, in addition to all other rights and remedies provided for herein or the other Loan Documents or otherwise available to it at law or in equity, all the rights and remedies of the Lender on default under the UCC (whether or not the UCC applies to the affected Collateral) to collect, enforce or satisfy any Secured Obligations then owing, whether by acceleration or otherwise, and also may to the fullest extent permitted by applicable law, pursue any of the following separately, successively or simultaneously: (i) require any Grantor to, and each Grantor hereby agrees that it shall at its expense and promptly upon request of the Lender forthwith, assemble all or part of the Collateral as directed by the Lender and make it available to the Lender at a place to be designated by the Lender that is reasonably convenient to both parties; (ii) personally, or by agents or attorneys, enter onto the property where any Collateral is located and take possession thereof with or without judicial process (provided such entry be done lawfully and without breaching the peace); (iii) prior to the disposition of the Collateral, store, process, repair or recondition the Collateral or otherwise prepare the Collateral for disposition in any manner to the extent the Lender deems appropriate and while the Collateral shall be so stored, provide such security and maintenance services as shall be commercially reasonable to protect the same and to preserve and maintain them in good condition; (iv) without notice except as specified below or under the UCC, sell, assign, lease, license (on an exclusive or nonexclusive basis) or otherwise dispose of the Collateral or any part thereof in one or more parcels at public or private sale, at any of the Lender’s offices or elsewhere, for cash, on credit or for future delivery, at such time or times and at such price or prices and upon such other terms as the Lender may deem commercially reasonable; and (v) apply any monies constituting Collateral or proceeds thereof in accordance with the provisions of Section 7.2.

 

(b)    The Lender may be the purchaser of any or all of the Collateral at any public or private (to the extent the portion of the Collateral being privately sold is of a kind that is customarily sold on a recognized market or the subject of widely distributed standard price quotations) sale in accordance with the UCC and the Lender shall be entitled, for the purpose of bidding and making settlement or payment of the purchase price for all or any portion of the Collateral sold at any such sale made in accordance with the UCC, to use and apply any of the Secured Obligations as a credit on account of the purchase price for any Collateral payable by the Lender at such sale. Each purchaser at any such sale shall hold the property sold absolutely free from any claim or right on the part of any Grantor, and each Grantor hereby waives (to the extent permitted by applicable law) all rights of redemption, stay and/or appraisal which it now has or may at any time in the future have under any rule of law or statute now existing or hereafter enacted. Each Grantor agrees that, to the extent notice of sale shall be required by law, at least ten (10) Business Days’ notice to such Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Lender shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Lender may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned. Each Grantor agrees that it would not be commercially unreasonable for the Lender to dispose of the Collateral or any portion thereof by using Internet sites that provide for the auction of assets of the types included in the Collateral or that have the reasonable capability of doing so, or that match buyers and sellers of assets. Each Grantor hereby waives (to the extent permitted by applicable law) any claims against the Lender arising by reason of the fact that the price at which any Collateral may have been sold at such a private sale was less than the price which might have been obtained at a public sale, even if the Lender accepts the first offer received and does not offer such Collateral to more than one offeree. If the proceeds of any sale or other disposition of the Collateral are insufficient to pay all the Secured Obligations, the Grantors shall remain liable for the deficiency and the reasonable and documented fees of any attorneys employed by the Lender to collect such deficiency. Each Grantor agrees to do or cause to be done all such other acts and things as may be reasonably necessary to make such disposition or dispositions of all or any portion of the Collateral valid and binding and in compliance with any and all applicable laws, regulations, orders, writs, injunctions, decrees or awards of any and all courts, arbitrators or Governmental Authorities, domestic or foreign, having jurisdiction over any such sale or sales, all at such Grantor’s expense. Each Grantor further agrees that a breach of any of the covenants contained in this Section will cause irreparable injury to the Lender, that the Lender has no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 7.1 shall be specifically enforceable against such Grantor, and such Grantor hereby waives (to the extent permitted by applicable law) and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that no default has occurred giving rise to the Secured Obligations becoming due and payable prior to their stated maturities. Nothing in this Section shall in any way alter the rights of the Lender hereunder.

 

 

(c)    The Lender may sell the Collateral without giving any warranties as to the Collateral. The Lender may specifically disclaim or modify any warranties of title or the like. This procedure will not be considered to adversely affect the commercial reasonableness of any sale of the Collateral.

 

(d)    The Lender shall have no obligation to marshal any of the Collateral.

 

7.2.    Application of Proceeds.

 

(a)    Whether or not any Insolvency Proceeding has been commenced by or against any Grantor, all proceeds received by the Lender upon any sale, any collection from, or other realization upon all or any part of, the Collateral (whether or not expressly characterized as such), or in any Insolvency Proceeding, together with all other moneys received by the Lender hereunder with respect thereto, shall be applied to the Secured Obligations in such order as the Lender shall determine in its sole discretion.

 

(b)    It is understood that the Grantors shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral and the aggregate amount of the Secured Obligations.

 

(c)    It is understood and agreed by each Grantor that the Lender shall have no liability for any determinations made by it in this Section 7.2, in each case except to the extent resulting from the gross negligence or willful misconduct of the Lender (as determined by a court of competent jurisdiction in a final and non-appealable decision).

 

 

7.3.    Sales on Credit. If the Lender sells any of the Collateral upon credit, each Grantor will be credited only with payments actually made by purchaser and received by the Lender and applied to indebtedness of the purchaser. In the event the purchaser fails to pay for any Collateral, the Lender may resell such Collateral and each Grantor shall be credited with proceeds of the sale.

 

7.4.    [Intentionally Omitted].

 

7.5.    Investment Related Property. Each Grantor recognizes that, by reason of certain prohibitions contained in the Securities Act of 1933 (the “Securities Act”) and applicable state securities laws, the Lender may be compelled, with respect to any sale of all or any part of the Investment Related Property conducted without prior registration or qualification of such Investment Related Property under the Securities Act and/or such state securities laws, to limit purchasers to those who will agree, among other things, to acquire the Investment Related Property for their own account, for investment and not with a view to the distribution or resale thereof. Each Grantor acknowledges that any such private sale may be at prices and on terms less favorable than those obtainable through a public sale without such restrictions (including a public offering made pursuant to a registration statement under the Securities Act) and, notwithstanding such circumstances, each Grantor agrees that any such private sale shall not be deemed to have been made in a commercially unreasonable manner solely as a result of it being a private sale, and that the Lender shall have no obligation to engage in public sales and no obligation to delay the sale of any Investment Related Property for the period of time necessary to permit the issuer thereof to register it for a form of public sale requiring registration under the Securities Act or under applicable state securities laws, even if such issuer would, or should, agree to so register it. If the Lender determines to exercise its right to sell any or all of the Investment Related Property, upon written request, each Grantor shall and shall cause each issuer of any Pledged Equity Interest to be sold hereunder, from time to time to furnish to the Lender all such information as Lender may reasonably request in order to determine the number and nature of interest, shares or other instruments included in the Investment Related Property which may be sold by the Lender in exempt transactions under the Securities Act and the rules and regulations of the Securities and Exchange Commission thereunder, as the same are from time to time in effect.

 

7.6.    Intellectual Property.

 

(a)    Anything contained herein to the contrary notwithstanding, upon the occurrence and during the continuation of an Event of Default beyond all applicable notice and cure periods:

 

(i)    the Lender shall have the right (but not the obligation) to bring suit or otherwise commence any action or proceeding in the name of any Grantor, the Lender or otherwise, in the Lender’s sole discretion, to enforce any Intellectual Property, in which event such Grantor shall, at the request of the Lender, do any and all lawful acts and execute any and all documents required by the Lender in aid of such enforcement and such Grantor shall promptly, upon demand, reimburse and indemnify the Lender as provided in the Credit Agreement in connection with the exercise of its rights under this Section, and, to the extent that the Lender shall elect not to bring suit to enforce any Intellectual Property as provided in this Section 7.6, each Grantor agrees to use, in its reasonable business judgment, all reasonable measures, whether by action, suit, proceeding or otherwise, to prevent the infringement or other violation of any of such Grantor’s rights in the Intellectual Property that is material to the business by others and for that purpose agrees to diligently maintain any action, suit or proceeding against any Person so infringing as shall be reasonably necessary to prevent such infringement or violation;

 

 

(ii)    upon the occurrence of an Event of Default, each Grantor shall grant, assign, convey or otherwise transfer to the Lender an absolute assignment of all of such Grantor’s right, title and interest in and to the Intellectual Property and shall execute and deliver to the Lender such documents as are reasonably necessary or appropriate to carry out the intent and purposes of this Agreement;

 

(iii)    the Lender shall have the right to notify, or require each Grantor to notify, any obligors with respect to amounts due or to become due to such Grantor in respect of the Intellectual Property, of the existence of the security interest created herein, to direct such obligors to make payment of all such amounts directly to the Lender, and, upon such notification and at the expense of such Grantor,

 

(1)    to enforce collection of any such amounts and to adjust, settle or compromise the amount or payment thereof, in the same manner and to the same extent as such Grantor might have done; and

 

(2)    such Grantor shall not adjust, settle or compromise the amount or payment of any such amount or release wholly or partly any obligor with respect thereto or allow any credit or discount thereon; and

 

(iv)    the Lender may (but shall not be obligated to), by written notice to the relevant Grantor, take any or all of the following actions: (1) declare the entire right, title, and interest of such Grantor in the Intellectual Property vested in the Lender in order to collect, enforce, or satisfy the Secured Obligations, in which event such right, title, and interest shall immediately vest in the Lender, in which case the Lender shall be entitled to exercise the power of attorney referred to in Section 6.1 hereof to execute, cause to be acknowledged and notarized and to record said absolute assignment with the applicable agency; (2) use or sell the Intellectual Property; (3) use or sell the goodwill of such Grantor’s business symbolized by the Trademarks and the right to carry on the business and use the assets of such Grantor in connection with which the Trademarks have been used; and (4) direct such Grantor to refrain, in which event such Grantor shall refrain, from using the Intellectual Property directly or indirectly, and such Grantor shall execute such further documents as the Lender may reasonably request further to confirm this and to transfer ownership of the Intellectual Property and registrations and any pending applications in the United States Copyright Office, United States Patent and Trademark Office, equivalent office in a state of the United States or a foreign jurisdiction or applicable domain name registrar to the Lender.

 

(b)    Each Grantor hereby grants to the Lender, to the extent it has the right to do so, (i) an irrevocable, nonexclusive license (exercisable without payment of royalty or other compensation to such Grantor) to use, operate under, license, or sublicense any Intellectual Property now owned or hereafter acquired by such Grantor, and wherever the same may be located; and (ii) an absolute power of attorney to sign, upon the occurrence and during the continuation of an Event of Default, any document which may be required to effect any assignments or enforce any rights or obligations as provided for in this Section 7.

 

 

7.7.    Cash Proceeds. In addition to the rights of the Lender specified in Section 4.2 with respect to payments of Receivables, if any Event of Default shall have occurred and be continuing beyond all applicable notice and cure periods, all proceeds of any Collateral received by any Grantor consisting of Cash Proceeds shall, upon demand by Lender, be held by such Grantor in trust for the Lender, segregated from other funds of such Grantor, and shall, forthwith upon receipt by such Grantor, unless such funds are deposited in a Deposit Account subject to a deposit account control agreement, be turned over to the Lender in the exact form received by such Grantor (duly indorsed by such Grantor to the Lender, if required) and held by the Lender. Any Cash Proceeds received by the Lender (whether from a Grantor or otherwise) if an Event of Default shall have occurred and be continuing, may, in the sole discretion of the Lender, (A) be held by the Lender as collateral security for the Secured Obligations (whether matured or unmatured) and/or (B) then or at any time thereafter be applied by the Lender against the Secured Obligations then due and owing in accordance with Section 7.2(a).

 

Section 8.    Continuing Security Interest.

 

This Agreement shall create a continuing security interest in the Collateral and shall remain in full force and effect until the payment in full in cash of the Secured Obligations and the irrevocable termination of the Credit Agreement, and be binding upon each Grantor, its successors and assigns, and inure, together with the rights and remedies of the Lender hereunder, to the benefit of the Lender and its successors, transferees and assigns.

 

Section 9.    Termination or Release.

 

(a)    This Agreement shall automatically terminate (other than provisions hereof providing for indemnities and similar contingent obligations) and the security interests granted hereby shall be automatically released upon the payment in full in cash of the Secured Obligations and the irrevocable termination of the Credit Agreement.

 

(b)    Upon any sale or other transfer by any Grantor of any Collateral to a Person that is not a Grantor that is permitted under the Credit Agreement, the security interest in such Collateral shall be automatically released.

 

Section 10.    Standard of Care; Lender May Perform.

 

The powers conferred on the Lender hereunder are solely to protect its interest in the Collateral and shall not impose any duty upon it to exercise any such powers. Except for the exercise of reasonable care in the custody of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Lender shall have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights or remedies against prior parties or any other rights or remedies pertaining to any Collateral. The Lender shall be deemed to have exercised reasonable care in the custody and preservation of Collateral in its possession if the Lender has dealt with such Collateral in the same manner as the Lender deals with similar property for its own account. Neither the Lender nor any of its directors, officers, employees or agents shall be liable for failure to demand, collect or realize upon all or any part of the Collateral or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral upon the request of any Grantor or otherwise. If any Grantor fails to perform any agreement contained herein, the Lender may perform, or cause performance of, such agreement and the costs, fees, expenses and disbursements of the Lender incurred in connection therewith shall be payable by each Grantor in accordance with the terms of the Credit Agreement.

 

 

Section 11.    Amendment; Waiver.

 

Except as otherwise provided in this Agreement with respect to adding or releasing Grantors hereunder or thereunder or executing supplements or joinders to this Agreement, none of the terms and conditions of this Agreement may be changed, waived, modified or varied in any manner whatsoever unless in writing duly signed by each Grantor directly affected thereby (it being understood that the addition or release of any Grantor hereunder or thereunder shall not constitute a change, waiver, discharge or termination affecting any Grantor other than the Grantor so added or released) and the Lender in accordance with the terms of the Credit Agreement.

 

Section 12.    Miscellaneous.

 

Any notice required or permitted to be given under this Agreement shall be given in accordance with Section 15(a) of the Credit Agreement. No failure or delay on the part of the Lender in the exercise of any power, right or privilege hereunder or under any other Loan Document shall impair such power, right or privilege or be construed to be a waiver of any default or acquiescence therein, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other power, right or privilege. All rights and remedies existing under this Agreement and the other Loan Documents are cumulative to, and not exclusive of, any rights or remedies otherwise available. In case any provision in or obligation under this Agreement shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby. In the event that any provision hereunder directly conflicts with any express provision of the Credit Agreement, the Credit Agreement shall control. This Agreement shall be binding upon and inure to the benefit of the Lender and the Grantors and their respective successors and permitted assigns. This Agreement and the other Loan Documents embody the entire agreement and understanding between the Grantors and the Lender and supersede all prior agreements and understandings between such parties relating to the subject matter hereof and thereof. Accordingly, the Loan Documents 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. This Agreement may be executed in one or more counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. Delivery of an executed signature page to this Agreement by facsimile, PDF or other electronic transmission shall be as effective as delivery of an original executed counterpart of this Agreement.

 

Section 13.    Updated Schedules.

 

Each fiscal quarter, at the time of delivery of quarterly financial statements pursuant to the Credit Agreement, the Borrower shall deliver to the Lender a certificate setting forth the information required by the Schedules to this Agreement or confirming that there has been no change in such information since the Closing Date or the date of the then most recent certificate delivered pursuant to this Section, as applicable.

 

 

Section 14.    Governing Law.

 

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEBRASKA.

 

Section 15.    Waiver of Jury Trial.

 

EACH PARTY HERETO MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT.

 

[SIGNATURE PAGES FOLLOW]

 

  

IN WITNESS WHEREOF, each Grantor and the Lender have caused this Agreement to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.

 

GRANTORS:

 

FIF AIREBEAM LLC

FIF ST. GEORGE, LLC

FIF UTAH LLC

 

 

By:/s/ Joseph M. Meisinger 

Name: Joseph M. Meisinger

Title: Authorized Signatory

 

 

BOSTON OMAHA BROADBAND, LLC

 

 

 

By: /s/ Joseph M. Meisinger 

Name: Joseph M. Meisinger

Title: Secretary

 

 

LENDER:

 

FIRST NATIONAL BANK OF OMAHA

 

 

 

By: /s/ Kara Geweke

Name: Kara Geweke

Title: Director

 

 

 

 

[SIGNATURE PAGE TO SECURITY AGREEMENT]

 

Exhibit 10.4

 

GUARANTY

 

Omaha, Nebraska

September 17, 2024

 

FOR VALUE RECEIVED, and in consideration of loans made or to be made or credit otherwise extended or to be extended by FIRST NATIONAL BANK OF OMAHA (the “Lender”) to or for the account of FIF AIREBEAM LLC, a Delaware limited liability company, FIF ST. GEORGE, LLC (d/b/a InfoWest), a Delaware limited liability company, and FIF UTAH LLC (d/b/a Utah Broadband), a Delaware limited liability company (collectively, the “Borrower”) from time to time and at any time and for other good and valuable consideration and to induce the Lender, in its discretion, to make such loans or extensions of credit and to make or grant such renewals, extensions, releases of collateral or relinquishments of legal rights as the Lender may deem advisable, the undersigned (and each of them if more than one, the liability under this Guaranty being joint and several) (jointly and severally referred to as “Guarantor” or “the undersigned”) unconditionally guaranties to the Lender and its successors, endorsees and assigns the prompt payment when due (whether by acceleration or otherwise) of all present and future obligations and liabilities of any and all kinds of the Borrower to Lender and of all instruments of any nature evidencing or relating to any such obligations and liabilities upon which the Borrower or one or more parties and the Borrower is or may become liable to Lender, whether incurred by the Borrower as maker, endorser, drawer, acceptor, guarantor, accommodation party or otherwise, and whether due or to become due, secured or unsecured, absolute or contingent, joint or several, and however or whenever acquired by the Lender, whether arising under, out of, or in connection with that certain Credit Agreement dated as of September 17, 2024 between the Lender and the Borrower (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) or any other Loan Document (as defined in the Credit Agreement), or otherwise (all of which are herein collectively referred to as the “Guaranteed Obligations”), and irrespective of the genuineness, validity, regularity or enforceability of such Guaranteed Obligations, or of any instrument evidencing any of the Guaranteed Obligations or of any collateral therefor or of the existence or extent of such collateral, and irrespective of the allowability, allowance or disallowance of any or all of the Guaranteed Obligations in any case commenced by or against the Borrower under Title 11, United States Code, including, without limitation, obligations or indebtedness of the Borrower for post-petition interest, fees, costs and charges that would have accrued or been added to the Guaranteed Obligations but for the commencement of such case. In furtherance of the foregoing, the undersigned hereby agrees as follows:

 

1.    No Impairment. Lender may at any time and from time to time, either before or after the maturity thereof, without notice to or further consent of the undersigned, extend the time of payment of, exchange or surrender any collateral for, renew or extend any of the Guaranteed Obligations or increase or decrease the interest rate thereon, and may also make any agreement with Borrower or with any other party to or person liable on any of the Guaranteed Obligations, or interested therein, for the extension, renewal, payment, compromise, discharge or release thereof, in whole or in part, or for any modification of the terms thereof or of any agreement between the Lender and the Borrower or any such other party or person, or make any election of rights Lender may deem desirable under the United States Bankruptcy Code, as amended, or any other federal or state bankruptcy, reorganization, moratorium or insolvency law relating to or affecting the enforcement of creditors’ rights generally (any of the foregoing, an “Insolvency Law”) without in any way impairing or affecting this Guaranty. This instrument shall be effective regardless of the subsequent incorporation, merger or consolidation of Borrower, or any change in the composition, nature, personnel or location of the Borrower and shall extend to any successor entity to the Borrower, including a debtor in possession or the like under any Insolvency Law.

 

2.    Guaranty Absolute. The undersigned guarantees that the Guaranteed Obligations will be paid strictly in accordance with the terms of the Credit Agreement and/or any other document, instrument or agreement creating or evidencing the Guaranteed Obligations, regardless of any law, regulation or order now or hereafter in effect in any jurisdiction affecting any of such terms or the rights of the Borrower with respect thereto. Guarantor hereby knowingly accepts the full range of risk encompassed within a contract of “continuing guaranty” which risk includes the possibility that the Borrower will contract additional indebtedness for which Guarantor may be liable hereunder after the Borrower’s financial condition or ability to pay its lawful debts when they fall due has deteriorated, whether or not the Borrower has properly authorized incurring such additional indebtedness. The undersigned acknowledges that (i) no oral representations, including any representations to extend credit or provide other financial accommodations to Borrower, have been made by the Lender to induce the undersigned to enter into this Guaranty and (ii) any extension of credit to the Borrower shall be governed solely by the provisions of the Credit Agreement. The liability of the undersigned under this Guaranty shall be absolute and unconditional, in accordance with its terms, and shall remain in full force and effect without regard to, and shall not be released, suspended, discharged, terminated or otherwise affected by, any circumstance or occurrence whatsoever, including, without limitation: (a) any waiver, indulgence, renewal, extension, amendment or modification of or addition, consent or supplement to or deletion from or any other action or inaction under or in respect of the Loan Documents or any other instruments or agreements relating to the Guaranteed Obligations or any assignment or transfer of any thereof, (b) any lack of validity or enforceability of any Loan Document or other documents, instruments or agreements relating to the Guaranteed Obligations or any assignment or transfer of any thereof, (c) any furnishing of any additional security to Lender or its assignees or any acceptance thereof or any release of any security by Lender or its assignees, (d) any limitation on any party’s liability or obligation under the Loan Documents or any other documents, instruments or agreements relating to the Guaranteed Obligations or any assignment or transfer of any thereof or any invalidity or unenforceability, in whole or in part, of any such document, instrument or agreement or any term thereof, (e) any bankruptcy, insolvency, reorganization, composition, adjustment, dissolution, liquidation or other like proceeding relating to Borrower, or any action taken with respect to this Guaranty by any trustee or receiver, or by any court, in any such proceeding, whether or not the undersigned shall have notice or knowledge of any of the foregoing, (f) any exchange, release or nonperfection of any collateral, or any release, or amendment or waiver of or consent to departure from any guaranty or security, for all or any of the Guaranteed Obligations or (g) any other circumstance which might otherwise constitute a defense available to, or a discharge of, the undersigned. Any amounts due from the undersigned to Lender shall bear interest until such amounts are paid in full at the highest rate then applicable to the Obligations (as defined in the Credit Agreement). Guaranteed Obligations include post-petition interest whether or not allowed or allowable.

 

 

3.    Waivers. This Guaranty is a guaranty of payment and not of collection. Lender shall be under no obligation to institute suit, exercise rights or remedies or take any other action against the Borrower or any other person liable with respect to any of the Guaranteed Obligations or resort to any collateral security held by it to secure any of the Guaranteed Obligations as a condition precedent to the undersigned being obligated to perform as agreed herein and Guarantor hereby waives any and all rights which it may have by statute or otherwise which would require Lender to do any of the foregoing. The Guarantor further consents and agrees that the Lender shall be under no obligation to marshal any assets in favor of the Guarantor, or against or in payment of any or all of the Guaranteed Obligations. The undersigned hereby waives all suretyship defenses and any rights to interpose any defense, counterclaim or offset of any nature and description which the undersigned may have or which may exist between and among the Lender, the Borrower and/or the undersigned with respect to the undersigned’s obligations under this Guaranty, or which the Borrower may assert on the underlying debt, including but not limited to failure of consideration, breach of warranty, fraud, payment (other than cash payment in full of the Guaranteed Obligations), statute of frauds, bankruptcy, infancy, statute of limitations, accord and satisfaction, and usury.

 

(b)    The undersigned further waives (i) notice of the acceptance of this Guaranty, of the making of any such loans or extensions of credit, and of all notices and demands of any kind to which the undersigned may be entitled, including, without limitation, notice of adverse change in Borrower’s financial condition or of any other fact which might materially increase the risk of the undersigned and (ii) presentment to or demand of payment from anyone whomsoever liable upon any of the Guaranteed Obligations, protest, notices of presentment, non-payment or protest and notice of any sale of collateral security or any default of any sort.

 

(c)    Notwithstanding any payment or payments made by the undersigned hereunder, or any setoff or application of funds of the undersigned by the Lender, the undersigned shall not be entitled to be subrogated to any of the rights of the Lender against the Borrower or against any collateral or guarantee or right of offset held by the Lender for the payment of the Guaranteed Obligations, nor shall the undersigned seek or be entitled to seek any contribution or reimbursement from the Borrower in respect of payments made by the undersigned hereunder, until all amounts owing to the Lender by the Borrower on account of the Guaranteed Obligations are paid in full in cash and the Credit Agreement has been irrevocable terminated. If, notwithstanding the foregoing, any amount shall be paid to the undersigned on account of such subrogation rights at any time when all of the Guaranteed Obligations shall not have been paid in full and the Credit Agreement shall not have been terminated, such amount shall be held by the undersigned in trust for the Lender, segregated from other funds of the undersigned, and shall forthwith upon, and in any event within five (5) business days of, receipt by the undersigned, be turned over to the Lender in the exact form received by the undersigned (duly endorsed by the undersigned to the Lender, if required), to be applied against the Guaranteed Obligations, whether matured or unmatured, in such order as the Lender may determine, subject to the provisions of the Credit Agreement. Any and all present and future debts and obligations of the Borrower to any of the undersigned are hereby waived and postponed in favor of, and subordinated to the full payment and performance of, all present and future debts and obligations of the Borrower to the Lender.

 

 

4.    Security. All sums at any time to the credit of the undersigned and any property of the undersigned in the Lender’s possession shall be deemed held by the Lender as security for any and all of the undersigned’s obligations to Lender, no matter how or when arising and whether under this or any other instrument, agreement or otherwise.

 

5.    Representations and Warranties. The undersigned hereby represents and warrants (all of which representations and warranties shall survive until all Guaranteed Obligations are satisfied in full in cash and the Credit Agreement has been irrevocably terminated), that any representation and warranty made by the Borrower in the Credit Agreement or any other Loan Documents with respect to the undersigned is true and correct in all material respects.

 

6.    Covenants. The undersigned covenants and agrees that until all Guaranteed Obligations are satisfied in full in cash and the Credit Agreement has been irrevocably terminated that it will comply with all covenants in the Credit Agreement and the other Loan Documents that are applicable to it as if such covenants and agreements were set forth in this Guaranty.

 

7.    Acceleration. If any Event of Default has occurred and is continuing beyond all applicable notice and cure periods under the Credit Agreement, or the undersigned should at any time become insolvent, or make a general assignment, or if a proceeding in or under any Insolvency Law shall be filed or commenced by, or in respect of, the undersigned, any and all Guaranteed Obligations shall for purposes hereof, at the Lender’s option, be deemed due and payable without notice notwithstanding that any such Guaranteed Obligation is not then due and payable by the Borrower.

 

8.    Payments from Guarantor. The Lender, in its sole and absolute discretion, with or without notice to the undersigned, may apply on account of the Guaranteed Obligations any payment from the undersigned or any other guarantor, or amounts realized from any security for the Guaranteed Obligations, or may deposit any and all such amounts realized in a non-interest bearing cash collateral deposit account to be maintained as security for the Guaranteed Obligations.

 

9.    Costs. The undersigned shall pay on demand, all reasonable out-of-pocket costs, fees and expenses (including reasonable and documented expenses for legal services of outside counsel) relating or incidental to the enforcement or protection of the rights of the Lender hereunder or under any of the Guaranteed Obligations.

 

10.    No Termination. This is a continuing irrevocable guaranty and shall remain in full force and effect and be binding upon the undersigned, and the undersigned’s successors and assigns, until all of the Guaranteed Obligations have been paid in full and the Credit Agreement has been irrevocably terminated. If any of the present or future Guaranteed Obligations are guaranteed by persons, partnerships, limited liability companies or corporations in addition to the undersigned, the death, release or discharge in whole or in part or the bankruptcy, merger, consolidation, incorporation, liquidation or dissolution of one or more of them shall not discharge or affect the liabilities of the undersigned under this Guaranty.

 

 

11.    Limitation on Guaranty. Notwithstanding any other provision of this Guaranty, the amount guaranteed by the undersigned hereunder shall be limited to the extent, if any, required so that its obligations hereunder shall not be subject to avoidance under Section 548 of the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent Conveyance Act or similar statute or common law. In determining the limitations, if any, on the amount of the undersigned’s obligations hereunder pursuant to the preceding sentence, it is the intention of the parties hereto that any rights of subrogation, indemnification or contribution which the undersigned may have under this Guaranty, any other agreement or applicable law shall be taken into account

 

12.    Recapture. Anything in this Guaranty to the contrary notwithstanding, if the Lender or receives any payment or payments on account of the liabilities guaranteed hereby, which payment or payments or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside and/or required to be repaid to a trustee, receiver, or any other party under any Insolvency Law, common law or equitable doctrine, then to the extent of any sum not finally retained by the Lender, the undersigned’s obligations to the Lender shall be reinstated and this Guaranty shall remain in full force and effect (or be reinstated) until payment shall have been made to Lender, which payment shall be due on demand.

 

13.    Intentionally Omitted.

 

14.    No Waiver. No failure on the part of the Lender to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof, nor shall any single or partial exercise by Lender of any right, remedy or power hereunder preclude any other or future exercise of any other legal right, remedy or power. Each and every right, remedy and power hereby granted to Lender or allowed it by law or other agreement shall be cumulative and not exclusive of any other, and may be exercised by Lender at any time and from time to time.

 

15.    Waiver of Jury Trial. THE UNDERSIGNED DOES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED ON OR WITH RESPECT TO THIS GUARANTY OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR RELATING OR INCIDENTAL HERETO. THE UNDERSIGNED DOES HEREBY CERTIFY THAT NO REPRESENTATIVE OR AGENT OF THE LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT LENDER WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THIS WAIVER OF RIGHT TO JURY TRIAL PROVISION.

 

16.    Governing Law; Jurisdiction; Amendments. THIS INSTRUMENT CANNOT BE CHANGED OR TERMINATED ORALLY, AND SHALL BE GOVERNED, CONSTRUED AND INTERPRETED AS TO VALIDITY, ENFORCEMENT AND IN ALL OTHER RESPECTS IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEBRASKA. THE UNDERSIGNED EXPRESSLY CONSENTS TO THE JURISDICTION AND VENUE OF THE STATE COURTS OF THE STATE OF NEBRASKA SITTING IN DOUGLAS COUNTY, NEBRASKA, AND OF THE UNITED STATES DISTRICT COURT FOR THE STATE OF NEBRASKA FOR ALL PURPOSES IN CONNECTION HEREWITH. ANY JUDICIAL PROCEEDING BY THE UNDERSIGNED AGAINST THE LENDER INVOLVING, DIRECTLY OR INDIRECTLY ANY MATTER OR CLAIM IN ANY WAY ARISING OUT OF, RELATED TO OR CONNECTED HEREWITH SHALL BE BROUGHT ONLY IN THE STATE COURTS OF THE STATE OF NEBRASKA SITTING IN DOUGLAS COUNTY, NEBRASKA OR THE UNITED STATES DISTRICT COURT FOR THE STATE OF NEBRASKA. THE UNDERSIGNED FURTHER CONSENTS THAT ANY SUMMONS, SUBPOENA OR OTHER PROCESS OR PAPERS (INCLUDING, WITHOUT LIMITATION, ANY NOTICE OR MOTION OR OTHER APPLICATION TO EITHER OF THE AFOREMENTIONED COURTS OR A JUDGE THEREOF) OR ANY NOTICE IN CONNECTION WITH ANY PROCEEDINGS HEREUNDER, MAY BE SERVED BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY PERSONAL SERVICE PROVIDED A REASONABLE TIME FOR APPEARANCE IS PERMITTED, OR IN SUCH OTHER MANNER AS MAY BE PERMISSIBLE UNDER THE RULES OF SAID COURTS. THE UNDERSIGNED WAIVES ANY OBJECTION TO JURISDICTION AND VENUE OF ANY ACTION INSTITUTED HEREON AND SHALL NOT ASSERT ANY DEFENSE BASED ON LACK OF JURISDICTION OR VENUE OR BASED UPON FORUM NON CONVENIENS.

 

 

17.    Severability. To the extent permitted by applicable law, any provision of this Guaranty which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

18.    Amendments, Waivers. No amendment or waiver of any provision of this Guaranty nor consent to any departure by the undersigned therefrom shall in any event be effective unless the same shall be in writing executed by the undersigned and the Lender.

 

19.    Notice. All notices, requests and demands to or upon the undersigned, shall be in writing and shall be deemed to have been duly given or made (a) when delivered, if by hand, (b) three (3) days after being sent, postage prepaid, if by registered or certified mail, (c) when confirmed electronically, if by facsimile, or (d) when delivered, if by a recognized overnight delivery service in each event, to the numbers and/or address set forth beneath the signature of the undersigned.

 

20.    Successors. Lender may, from time to time, without notice to the undersigned, sell, assign, transfer or otherwise dispose of all or any part of the Guaranteed Obligations and/or rights under this Guaranty in accordance with the terms of the Credit Agreement.

 

21.    Release. Nothing except cash payment in full in cash of the Guaranteed Obligations shall release the undersigned from liability under this Guaranty.

 

22.    Additional Guarantors. From time to time subsequent to the date hereof, to the extent required by the Loan Documents, additional Persons may become parties hereto as additional Guarantors (each, an “Additional Guarantor”), by executing a joinder to this Guaranty in form and substance reasonably satisfactory to the Lender. Upon delivery of any such joinder to the Lender, notice of which is hereby waived by the Guarantors, each Additional Guarantor shall be a Guarantor and shall be as fully a party hereto as if such Additional Guarantor were an original signatory hereto. Each Guarantor expressly agrees that its obligations arising hereunder shall not be affected or diminished by the addition or release of any other Guarantor hereunder, nor by any election of the Lender not to cause any Subsidiary of the Borrower to become an Additional Guarantor hereunder. This Guaranty shall be fully effective as to any Guarantor that is or becomes a party hereto regardless of whether any other Person becomes or fails to become or ceases to be a Guarantor hereunder.

 

[SIGNATURE PAGE FOLLOWS]

 

  

IN WITNESS WHEREOF, this Guaranty has been executed by the undersigned as of the day and year first above written.

 

BOSTON OMAHA BROADBAND, LLC

 

 

By:/s/ Joseph M. Meisinger

Name: Joseph M. Meisinger         

Title: Secretary

 

Address: 1601 Dodge St, Suite 3300

Telephone: 402-650-0015

 

 

 

SIGNATURE PAGE TO GUARANTY

 

v3.24.3

Document And Entity Information	Sep. 17, 2024
Document Information [Line Items]
Entity, Registrant Name	BOSTON OMAHA CORPORATION
Current Fiscal Year End Date	--12-31
Document, Type	8-K
Document, Period End Date	Sep. 17, 2024
Entity, Incorporation, State or Country Code	DE
Entity, File Number	001-38113
Entity, Tax Identification Number	27-0788438
Entity, Address, Address Line One	1601 Dodge Street, Suite 3300
Entity, Address, City or Town	Omaha
Entity, Address, State or Province	NE
Entity, Address, Postal Zip Code	68102
City Area Code	857
Local Phone Number	256-0079
Title of 12(b) Security	Class A common stock
Trading Symbol	BOC
Security Exchange Name	NYSE
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Entity, Emerging Growth Company	false
Amendment Flag	false
Entity, Central Index Key	0001494582

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