Exhibit 10.44
REVOLVING LINE-OF-CREDIT
MAXIMUM
$17,000,000
REVOLVING LINE OF CREDIT NOTE
AFTER DATE, FOR
VALUE RECEIVED, Smith & Wesson Corp., a Delaware corporation,
having a principal place of business at 2100 Roosevelt Avenue,
Springfield, Massachusetts (the “Borrower”), promises
to pay to the order, of Banknorth, N.A., a national banking
association (“Lender”), having a usual place of
business at 1441 Main Street, Springfield, Massachusetts, or order,
the maximum principal sum of Seventeen Million and 00/100 Dollars
($17,000,000) or so much thereof as may be Advanced (each Advance
shall be referred to as an “Advance” and all such
Advances shall collectively be referred to as the
“Advances”), pursuant to a Loan and Security Agreement
of even date herewith (the “Loan Agreement”) and
incorporated by reference herein and between Borrower, Guarantor
and Lender. Capitalized terms not defined herein shall have the
meanings given in the Loan Agreement. The principal outstanding
shall be repaid, together with interest thereon in arrears,
calculated daily and payable monthly, commencing thirty
(30) days from the date hereof and thereafter on the same day
of each succeeding month, on the outstanding and unpaid principal
amount of the Revolving Line of Credit Loans during the preceding
month at a rate per annum equal to:
A.
Lender’s Prime Rate; or
B.
LIBOR Interest Rate, plus two and one half percent (2.50%) based on
the Interest Period selected by the Borrower and confirmed in
writing to the Borrower following Borrower’s request for a
LIBOR Loan or a conversion to a LIBOR Loan as set forth in the Loan
Agreement. Notwithstanding the forgoing, the LIBOR Interest Rate
for a LIBOR Loan shall be reduced to LIBOR, plus two and
one-quarter percent (2.25%) when Maximum Leverage is less than or
equal to 2.00:1.00 and shall be further reduced to LIBOR, plus two
percent (2.00%) at such time when Maximum Leverage is equal to or
less than 1.25:1.00.
Subject to the
terms and conditions contained in the Loan Agreement, this
Revolving Line of Credit Note shall be repaid in accordance with
the terms of the Loan Agreement. This Note is the Note referred to
in, and is subject to, and entitled to, the benefits of the Loan
Agreement.
However, nothing
herein shall be construed to restrict the Lender, in its sole and
exclusive discretion, from making advances in excess of the stated
maximum dollar amount, without requirement of execution of
additional promissory note(s), or otherwise modifying this Note,
and its so doing at any time, or times, shall not waive its rights
to insist upon strict compliance with the terms of this Note, or
any other instruments executed in connection with this financial
transaction, at any other time, and to further rely upon all
collateral secured to it for satisfaction of all obligations of the
Borrower to the Lender, without exception.
1
Borrower agrees
that the Lender may, at its reasonable discretion, make Loan
Advances to the Borrower upon written, authority of any person
authorized so to act on behalf of the Borrower; may deliver loan
proceeds by direct deposit to any demand deposit account of the
Borrower with the Lender, or otherwise, as so directed; and that
all such loans and advances as evidenced solely by the
Lender’s books, ledgers and records shall presumptively
represent binding obligations of the Borrower hereunder.
Borrower does
hereby irrevocably grant to the Lender, full power and authority,
at its discretion, to debit any deposit account of the Borrower
with the Lender for the amount of any monthly interest owing on
Borrower’s Loan Account; for the amount of any principal
reduction, or for any repayment of obligations due upon
Borrower’s Loan Account which the Lender may require, all
without prior notice, or demand upon the Borrower.
Any
payments received by Lender with respect to this Note shall be
applied first to any costs, charges, or expenses (including
attorney’s fees) due Lender from the Borrower, second to any
unpaid interest hereunder, and third to the unpaid principal sum
owing under this Note.
The
Borrower acknowledges that this Note is an obligation which is
payable immediately upon the occurrence of an Event of Default as
more fully described in the Loan Agreement.
Lender shall have
the unrestricted right at any time or from time to time, and
without Borrower consents, to sell, assign, endorse, or transfer
all or any portion of its rights and obligations hereunder to one
or more Lenders or other entities (each an “Assignee”),
and Borrower agrees that it shall execute, or cause to be executed
such documents necessary to effect the foregoing. In addition, at
the request of Lender and any such Assignee, Borrower shall issue
one or more new promissory notes, as applicable, to any such
Assignee and, if Lender has retained any of its rights and
obligations hereunder following such assignment, to Lender, which
new promissory notes shall be issued in replacement of, but not in
discharge of, the liability evidenced by the note held by Lender
prior to such assignment and shall reflect the amount of the
respective commitments and loans held by such Assignee and Lender
after giving effect to such assignment. Upon the execution and
delivery of appropriate assignment documentation in connection with
such assignment, and the payment by Assignee of the purchase price
agreed to by Lender and such Assignee, such Assignee shall be a
party to this Agreement and shall have all of the rights and
obligations of Lender hereunder (and under any and all other
guaranties, documents, instruments and agreements executed in
connection herewith) to the extent that such rights and obligations
have been assigned by Lender pursuant to the assignment
documentation between Lender and Assignee, and Lender shall be
released from its obligation hereunder and thereunder to a
corresponding extent.
Lender shall have
the unrestricted right at any time and from time to time, and
without the consent of or
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