{
  "docId": "019dd923-622c-750b-8b98-8535f99706c6",
  "docSlug": "23f68cb049f9",
  "documentTitle": "Mercury Systems Inc. (MRCY)",
  "authorId": "54_Spruce_Point_Capital",
  "authorName": "Mercury Systems Inc.",
  "documentKindSlug": "research-note",
  "documentKindLabel": "Research note",
  "sourceTypeSlug": "short_seller",
  "sourceTypeLabel": "Short seller",
  "presentationDate": "2018-10-17 00:00:00",
  "orientation": "landscape",
  "aspectRatio": 1.3333334,
  "pageNumber": 23,
  "pageCount": 40,
  "prevPage": 22,
  "nextPage": 24,
  "slideType": "expose_contradiction",
  "function": "expose_contradiction",
  "density": "overcrowded",
  "nDataPoints": 2,
  "notes": "The slide uses legal text excerpts to build a case for potential misrepresentation by the company to its lenders.",
  "elementsJson": [
    "headline_text",
    "paragraph",
    "callout_box"
  ],
  "metadataConfidence": 0.95,
  "imagePath": null,
  "slideHref": "/slides/019dd923-622c-750b-8b98-8535f99706c6/23",
  "deckHref": "/decks/019dd923-622c-750b-8b98-8535f99706c6",
  "deckJsonHref": "/decks/019dd923-622c-750b-8b98-8535f99706c6.json",
  "deckAnchorHref": "/decks/019dd923-622c-750b-8b98-8535f99706c6#slide-23",
  "components": [
    {
      "bbox": {
        "h": 0.05,
        "w": 0.9,
        "x": 0.05,
        "y": 0.26
      },
      "kind": "callout",
      "text": "As part of this amendment, Mercury made certain reps and warranties including that \"No Material Adverse Effect\" had taken place since closing. Does removing Supermicro as a key technology partner qualify?",
      "attrs": null,
      "subkind": "primary",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "36b39d96-9afd-4c83-bdd6-92a9ceaae4c7",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "callout",
      "text": "As part of this amendment, Mercury made certain reps and warranties including that “No Material Adverse Effect” had taken place since closing. Does removing Supermicro as a key technology partner qualify?",
      "attrs": null,
      "subkind": null,
      "toolName": "Visual emphasis",
      "toolSlug": "visual-emphasis",
      "confidence": null,
      "componentId": "019dd952-ee3c-76df-964f-14c84bb9153f",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.18,
        "w": 0.9,
        "x": 0.05,
        "y": 0.33
      },
      "kind": "paragraph",
      "text": "3. Representations and Warranties. On and as of the Amendment No. 3 Effective Date, the Borrower hereby represents and warrants to the Administrative Agent and each New Revolving Credit Lender, after giving effect to the amendments set forth in this Amendment, that: (a) The representations and warranties of the Borrower and each other Credit Party contained in Article 6 of the Amended Credit Agreement or any other Credit Document are true and correct in all material respects... (b) No Default or Event of Default exists.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "0dec3f34-8909-41ab-83a6-6150d8182a73",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.12,
        "w": 0.9,
        "x": 0.05,
        "y": 0.65
      },
      "kind": "paragraph",
      "text": "Section 6.05. Financial Statements. The Annual Financial Statements fairly present in all material respects the financial condition of the Borrower and its Subsidiaries... Section 6.06. No Material Adverse Effect. Since the Closing Date, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "5c1f4d88-dcf4-4253-ae99-d64ee0bec2f0",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.9,
        "x": 0.05,
        "y": 0.83
      },
      "kind": "paragraph",
      "text": "\"Material Adverse Effect\" means (a) a material adverse change in, or a material adverse effect upon, the operations, business, assets, properties, liabilities or financial condition of the Borrower and its Restricted Subsidiaries, taken as a whole...",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "c9e3d11d-db64-4dbe-9d2d-77441a855937",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.06,
        "w": 0.9,
        "x": 0.05,
        "y": 0.19
      },
      "kind": "paragraph",
      "text": "On October 1, 2018 Mercury filed Amendment No. 3 with the SEC stating that it had expanded its credit facility to $750m, extended the maturity to Sept 28, 2023 and reduced its interest rate. It currently has $240m outstanding on the facility.",
      "attrs": null,
      "subkind": "paragraph",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "dc079546-c09f-402f-8629-5bc7e37c50cb",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": null,
      "kind": "quote",
      "text": "“Material Adverse Effect” means (a) a material adverse change in, or a material adverse effect upon, the operations, business, assets, properties, liabilities (actual or contingent) or financial condition of the Borrower and its Restricted Subsidiaries, taken as a whole; (b) a material adverse effect of the ability of the Credit Parties, as a whole, to perform their payment obligations under the Credit Documents; or (c) a material adverse effect upon the rights and remedies available to the Lenders or the Administrative Agent under any Credit Document. — Credit Agreement Amendment 3",
      "attrs": null,
      "subkind": null,
      "toolName": "Authority citation",
      "toolSlug": "authority-citation",
      "confidence": null,
      "componentId": "019dd952-ee3c-76df-964f-19279a3a7e80",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.02,
        "w": 0.2,
        "x": 0.05,
        "y": 0.95
      },
      "kind": "source-note",
      "text": "Source: Credit Agreement Amendment 3",
      "attrs": null,
      "subkind": null,
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "f8b0ba69-659f-419f-b7a3-07cf6a3facb8",
      "frameworkName": null,
      "frameworkSlug": null
    },
    {
      "bbox": {
        "h": 0.08,
        "w": 0.65,
        "x": 0.31,
        "y": 0.03
      },
      "kind": "title",
      "text": "We Hope Mercury Made Accurate Reps/Warranties To Its Bankers...",
      "attrs": null,
      "subkind": "headline",
      "toolName": null,
      "toolSlug": null,
      "confidence": null,
      "componentId": "370cc8c2-dcea-409b-b1bf-df6c709fa1ad",
      "frameworkName": null,
      "frameworkSlug": null
    }
  ],
  "metrics": [],
  "tools": [],
  "frameworks": [
    {
      "name": "fraud-exposure",
      "slug": null,
      "matchId": "b71b2076-9f3f-4856-b66e-cc0cc8d2a236",
      "evidence": "The slide attempts to expose a potential misrepresentation by the company to its lenders regarding material adverse effects.",
      "confidence": 0.85
    }
  ],
  "arcBeats": [
    {
      "to": 40,
      "from": 21,
      "beatId": "123c8aca-05a4-4fcf-ad50-fc8ae12c1a98",
      "arcName": "Overcoming the Monster",
      "arcSlug": "overcoming-monster",
      "beatName": "The Victory",
      "beatSlug": "overcoming-monster-the-victory",
      "evidence": "Conclusion and reiteration of the thesis",
      "position": 2,
      "confidence": 0.7,
      "parentBeatName": "Turn",
      "parentBeatSlug": "turn"
    }
  ],
  "loops": [],
  "imagePathAlt": null,
  "thumbSrc": null,
  "thumbSrcAlt": null,
  "locked": true
}