Exhibit 4.13
CREDIT AGREEMENT
THIS CREDIT
AGREEMENT (this "Agreement") is entered into as of December 30,
2005, by and between ITRON, INC., a
Washington corporation ("Borrower"), and
WELLS FARGO BANK, NATIONAL ASSOCIATION
("Bank").
RECITALS
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A. Borrower has requested that
Bank extend or continue credit to Borrower
as described below, and Bank has agreed to
provide such credit to Borrower on
the terms and conditions contained
herein.
B. Borrower has entered into a
Credit Agreement dated as of December 17,
2003 among Borrower as "Borrower"
thereunder, the lenders party thereto, Bear,
Stearns & Co., Inc., as sole lead
arranger and sole bookrunner, Bear Stearns
Corporate Lending Inc., as syndication
agent and Bank, as "Administrative Agent"
thereunder (as amended, modified, restated
or supplemented from time to time,
the "Syndicated Credit Agreement").
C. Borrower and Bank have
decided to incorporate herein some of the
provisions of the Syndicated Credit
Agreement as it is in effect as of the date
of this Agreement.
NOW, THEREFORE,
for valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Bank and
Borrower hereby agree as follows:
ARTICLE I
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CREDIT TERMS
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SECTION 1.1.
TERM
LOAN.
(a) Term Loan. Subject to the terms
and conditions of this Agreement, Bank
hereby agrees to make a loan to Borrower in
the principal amount of Fourteen
Million Eight Hundred Thousand Dollars
($14,800,000.00) ("Term Loan"), the
proceeds of which shall be used for long
term financing. Borrower's obligation
to repay the Term Loan shall be evidenced
by a promissory note dated as of
December 30, 2005 ("Term Note"), all terms
of which are incorporated herein by
this reference. Bank's commitment to grant
the Term Loan shall terminate on
January 30, 2006.
(b) Repayment. The principal amount of
the Term Loan shall be repaid in
accordance with the provisions of the Term
Note.
(c) Prepayment. Borrower may prepay
principal on the Term Loan solely in
accordance with the provisions of the Term
Note.
SECTION 1.2.
INTEREST.
(a) Interest. The outstanding
principal balance of each credit subject
hereto shall bear interest at the rate of
interest set forth in each promissory
note or other instrument or document
executed in connection therewith.
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(b) Computation and Payment. Interest
shall be computed on the basis of a
360-day year, actual days elapsed. Interest
shall be payable at the times and
place set forth in each promissory note or
other instrument or document required
hereby.
SECTION 1.3.
COLLECTION OF PAYMENTS. Borrower authorizes Bank to collect
all principal and interest due hereunder by
charging Borrower's deposit account
number 4375688967 with Bank, or any other
deposit account maintained by Borrower
with Bank, for the full amount thereof.
Should there be insufficient funds in
any such deposit account to pay all such
sums when due, the full amount of such
deficiency shall be immediately due and
payable by Borrower.
SECTION 1.4.
COLLATERAL.
As security for
all indebtedness of Borrower to Bank subject hereto,
Borrower shall grant to Bank a lien of not
less than first priority on that
certain real property located at 2111 North
Molter Road, Liberty Lake
Washington, 99019.
All of the
foregoing shall be evidenced by and subject to the terms of
such
security agreements, financing statements,
deeds or mortgages, and other
documents as Bank shall reasonably require,
all in form and substance
satisfactory to Bank. Borrower shall
reimburse Bank immediately upon demand for
all costs and expenses incurred by Bank in
connection with any of the foregoing
security, including without limitation,
filing and recording fees and costs of
appraisals, audits and title insurance.
ARTICLE II
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REPRESENTATIONS AND WARRANTIES
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Borrower makes
the following representations and warranties to Bank, which
representations and warranties shall
survive the execution of this Agreement and
shall continue in full force and effect
until the full and final payment, and
satisfaction and discharge, of all
obligations of Borrower to Bank subject to
this Agreement.
SECTION 2.1.
LEGAL STATUS. Borrower is a corporation, duly organized and
existing and in good standing under the
laws of Washington, and is qualified or
licensed to do business (and is in good
standing as a foreign corporation, if
applicable) in all jurisdictions in which
such qualification or licensing is
required or in which the failure to so
qualify or to be so licensed could have a
material adverse effect on Borrower.
SECTION 2.2.
AUTHORIZATION AND VALIDITY. This Agreement and each promissory
note, contract, instrument and other
document required hereby or at any time
hereafter delivered to Bank in connection
herewith (collectively, the "Loan
Documents") have been duly authorized, and
upon their execution and delivery in
accordance with the provisions hereof will
constitute legal, valid and binding
agreements and obligations of Borrower or
the party which executes the same,
enforceable in accordance with their
respective terms.
SECTION 2.3. NO
VIOLATION. The execution, delivery and performance by
Borrower of each of the Loan Documents do
not violate any material provision of
any law or regulation, or contravene any
provision of the Articles of
Incorporation or By-Laws of Borrower, or
result in any breach of or default
under any material contract, obligation,
indenture or other instrument to which
Borrower is a party or by which Borrower
may be bound.
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SECTION 2.4.
LITIGATION. There are no pending, or to the best of Borrower's
knowledge threatened, actions, claims,
investigations, suits or proceedings by
or before any governmental authority,
arbitrator, court or administrative agency
which could have a material adverse effect
on the financial condition or
operation of Borrower other than those
disclosed by Borrower to Bank in writing
prior to the date hereof.
SECTION 2.5.
CORRECTNESS OF FINANCIAL STATEMENT. The financial statement of
Borrower dated September 30, 2005, a true
copy of which has been delivered by
Borrower to Bank prior to the date hereof,
(a) is complete and correct in all
material respects and presents fairly the
financial condition of Borrower, (b)
discloses all liabilities of Borrower that
are required to be reflected or
reserved against under generally accepted
accounting principles, whether
liquidated or unliquidated, fixed or
contingent, and (c) has been prepared in
accordance with generally accepted
accounting principles consistently applied.
Since the date of such financial statement
there has been no material adverse
change in the financial condition of
Borrower, nor has Borrower mortgaged,
pledged, granted a security interest in or
otherwise encumbered any of its
assets or properties except in favor of
Bank or as otherwise permitted by Bank
in writing.
SECTION 2.6.
INCOME TAX RETURNS. Borrower has no knowledge of any pending
adverse assessments or adjustments of its
income tax payable with respect to any
year.
SECTION 2.7. NO
SUBORDINATION. There is no agreement, indenture, contract
or instrument to which Borrower is a party
or by which Borrower may be bound
that requires the subordination in right of
payment of any of Borrower's
obligations subject to this Agreement to
any other obligation of Borrower.
SECTION 2.8.
PERMITS, FRANCHISES. Borrower possesses, and will hereafter
possess, all permits, consents, approvals,
franchises and licenses required and
rights to all trademarks, trade names,
patents, and fictitious names, if any,
necessary to enable it to conduct the
business in which it is now engaged in
compliance with applicable law.
SECTION 2.9.
ERISA. Borrower is in compliance in all material respects with
all applicable provisions of the Employee
Retirement Income Security Act of
1974, as amended or recodified from time to
time ("ERISA"); Borrower has not
violated any provision of any defined
employee pension benefit plan (as defined
in ERISA) maintained or contributed to by
Borrower (each, a "Plan"); no
Reportable Event as defined in ERISA has
occurred and is continuing with respect
to any Plan initiated by Borrower; Borrower
has met its minimum funding
requirements under ERISA with respect to
each Plan; and each Plan will be able
to fulfill its benefit obligations as they
come due in accordance with the Plan
documents and under generally accepted
accounting principles.
SECTION 2.10.
OTHER OBLIGATIONS. Borrower is not in default on any
obligation for borrowed money, any purchase
money obligation or any other
material lease, commitment, contract,
instrument or obligation.
SECTION 2.11.
ENVIRONMENTAL MATTERS. Except as disclosed by Borrower to
Bank in writing prior to the date hereof,
Borrower is in compliance in all
material respects with all applicable
federal or state environmental, hazardous
waste, health and safety statutes, and any
rules or regulations adopted pursuant
thereto, which govern or affect any of
Borrower's real property collateral
required hereby, including without
limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of
1980, the Superfund Amendments and
Reauthorization Act of 1986, the Federal
Resource Conservation and Recovery Act
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of 1976, and the Federal Toxic Substances
Control Act, as any of the same may be
amended, modified or supplemented from time
to time. None of the operations of
Borrower is the subject of any federal or
state investigation evaluating whether
any remedial action involving a material
expenditure is needed to respond to a
release of any toxic or hazardous waste or
substance into the environment.
Borrower has no material contingent
liability in connection with any release of
any toxic or hazardous waste or substance
into the environment.
SECTION 2.12.
REAL PROPERTY COLLATERAL. Except as disclosed by Borrower to
Bank in writing prior to the date hereof,
with respect to any real property
collateral required hereby:
(a) All taxes, governmental
assessments, insurance premiums, and water,
sewer and municipal charges, and rents (if
any) which previously became due and
owing in respect thereof have been paid as
of the date hereof.
(b) There are no mechanics' or similar
liens or claims which have been
filed for work, labor or material (and no
rights are outstanding that under law
could give rise to any such lien) which
affect all or any interest in any such
real property and which are or may be prior
to or equal to the lien thereon in
favor of Bank.
(c) None of the improvements which
were included for purpose of
determining the appraised value of any such
real property lies outside of the
boundaries and/or building restriction
lines thereof, and no improvements on
adjoining properties materially encroach
upon any such real property.
(d) There is no pending, or to the
best of Borrower's knowledge
threatened, proceeding for the total or
partial condemnation of all or any
portion of any such real property, and all
such real property is in good repair
and free and clear of any damage that would
materially and adversely affect the
value thereof as security and/or the
intended use thereof.
ARTICLE III
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CONDITIONS
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SECTION 3.1.
CONDITIONS OF INITIAL EXTENSION OF CREDIT. The obligation of
Bank to extend any credit contemplated by
this Agreement is subject to the
fulfillment to Bank's satisfaction of all
of the following conditions:
(a) Approval of Bank Counsel. All
legal matters incidental to the
extension of credit by Bank shall be
satisfactory to Bank's counsel.
(b) Documentation. Bank shall have
received, in form and substance
satisfactory to Bank, each of the
following, duly executed:
(i) This Agreement and
the Term Note.
(ii) Disbursement
Order.
(iii) Corporate
Resolution: Borrowing.
(iv) Certificate of
Incumbency.
(v) Deed of Trust and
Assignment of Rents and Leases.
(vi) Insurance
Information Letter.
(vii) Such other
documents as Bank may require under any other Section
of this Agreement.
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(c) Financial Condition. There shall
have been no material adverse change,
as determined by Bank, in the financial
condition or business of Borrower, nor
any material decline, as determined by
Bank, in the market value of any
collateral required hereunder or a
substantial or material portion of the assets
of Borrower.
(d) Insurance. Borrower shall have
delivered to Bank evidence of insurance
coverage on all Borrower's real property
collateral required hereby, in form,
substance, amounts, covering risks and
issued by companies reasonably
satisfactory to Bank, and where required by
Bank, with loss payable endorsements
in favor of Bank, including without
limitation, policies of fire and extended
coverage insurance covering all real
property collateral required hereby, with
replacement cost and mortgagee loss payable
endorsements, and such policies of
insurance against specific hazards
affecting any such real property as may be
required by governmental regulation or
Bank.
(e) Appraisals. Bank shall have
obtained, at Borrower's cost, an appraisal
of all real property collateral required
hereby, and all improvements thereon,
issued by an appraiser acceptable to Bank
and in form, substance and reflecting
values satisfactory to Bank, in its
discretion.
(f) Title Insurance. Bank shall have
received an ALTA Policy of Title
Insurance, with such endorsements as Bank
may require, issued by a company and
in form and substance satisfactory to Bank,
in the amount of the Term Loan,
insuring Bank's lien on the real property
collateral required hereby to be of
first priority, subject only to such
exceptions as Bank shall approve in its
discretion, with all costs thereof to be
paid by Borrower.
(g) Tax Service Contract. Borrower
shall have procured and delivered to
Bank, at Borrower's cost, such tax service
contract as Bank shall require for
any real property collateral required
hereby, to remain in effect as long as
such real property secures any obligations
of Borrower to Bank as required
hereby.
SECTION 3.2.
CONDITIONS OF EACH EXTENSION OF CREDIT. The obligation of Bank
to make each extension of credit requested
by Borrower hereunder shall be
subject to the fulfillment to Bank's
satisfaction of each of the following
conditions:
(a) Compliance. The representations
and warranties contained herein and in
each of the other Loan Documents shall be
true in all material respects on and
as of the date of the signing of this
Agreement and on the date of each
extension of credit by Bank pursuant
hereto, with the same effect as though such
representations and warranties had been
made on and as of each such date, and on
each such date, no Event of Default as
defined herein, and no condition, event
or act which with the giving of notice or
the passage of time or both would
constitute such an Event of Default, shall
have occurred and be continuing or
shall exist.
(b) Documentation. Bank shall have
received all additional documents which
may be reasonably required in connection
with such extension of credit.
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ARTICLE IV
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AFFIRMATIVE COVENANTS
---------------------
Borrower
covenants that so long as Bank remains committed to extend
credit
to Borrower pursuant hereto, or any
liabilities (whether direct or contingent,
liquidated or unliquidated) of Borrower to
Bank under any of the Loan Documents
remain outstanding, and until payment in
full of all obligations of Borrower
subject hereto, Borrower shall, unless Bank
otherwise consents in writing:
SECTION 4.1.
PUNCTUAL PAYMENTS. Punctually pay all principal, interest or
other liabilities due under any of the Loan
Documents at the times and place and
in the manner specified therein.
SECTION 4.2.
ACCOUNTING RECORDS. Maintain adequate books and records in
accordance with generally accepted
accounting principles consistently applied,
and permit any representative of Bank, at
any reasonable time, to inspect, audit
and examine such books and records, to make
copies of the same, and to inspect
the properties of Borrower.
SECTION 4.3.
FINANCIAL STATEMENTS. Provide to Bank all of the following, in
form and detail satisfactory to Bank:
(a) not later than 90 days after and
as of the end of each fiscal year, a
consolidated copy of the 10K report of
Borrower and its consolidated
subsidiaries filed with t
