1
EXHIBIT 10.3
[CONFORMED COPY WITH
EXHIBITS G, H, AND I
CONFORMED AS EXECUTED]
CREDIT AGREEMENT
among
ACME METALS INCORPORATED,
VARIOUS LENDERS,
BANKERS TRUST COMPANY,
as Administrative Agent,
and
XXXXXX XXXXXXX SENIOR FUNDING, INC.,
as Syndication Agent and Arranger
---------------------------------------
Dated as of December 18, 1997
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TABLE OF CONTENTS
Page
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SECTION 1. Amount and Terms of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.01 The Commitment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.02 Minimum Amount of Each Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.03 Notice of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.04 Disbursement of Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.05 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.06 Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.07 Pro Rata Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.08 Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.09 Interest Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.10 Increased Costs, Illegality, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.11 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.12 Change of Lending Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.13 Replacement of Lenders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 2. Fees; Termination of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.01 Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.02 Termination of Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 3. Prepayments; Payments; Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.01 Voluntary Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.02 Mandatory Repayments and Commitment Reductions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.03 Method and Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3.04 Net Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 4. Conditions Precedent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.01 Execution of Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.02 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.03 Officer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.04 Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.05 Corporate Documents; Proceedings; etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.06 Tax Sharing Agreements; Existing Indebtedness Agreements . . . . . . . . . . . . . . . . . . . . . . . . 2
4.07 New Senior Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.08 Existing Senior Secured Notes Tender Offer, Existing Senior Secured Notes Consents; Existing
Senior Secured Notes Indenture Supplements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.09 Bank Refinancing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.10 Working Capital Facility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.11 Adverse Change, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.12 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.13 Pledge Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.14 Security Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.15 Subsidiaries Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.16 Mortgages; Title Insurance; Survey; etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.17 Notice of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.18 Financial Statements; Pro Forma Financial Statements, Projections . . . . . . . . . . . . . . . . . . . 2
4.19 Solvency Certificate; Environmental Analyses; Insurance Certificates . . . . . . . . . . . . . . . . . 2
4.20 Fees, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
4.21 No Default; Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
3
SECTION 5. Representations, Warranties and Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.01 Corporate Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.02 Corporate and Other Power and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.03 No Violation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.04 Approvals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.05 Financial Statements; Financial Condition; Undisclosed Liabilities; Projections; etc. . . . . . . . . 3
5.06 Litigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.07 True and Complete Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.08 Use of Proceeds; Margin Regulations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.09 Tax Returns and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.10 Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.11 The Security Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.12 Representations and Warranties in the Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.13 Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.14 Capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.15 Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.16 Compliance with Statutes, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.17 Investment Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.18 Public Utility Holding Company Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.19 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.20 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.21 Patents, Licenses, Franchises and Formulas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.22 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.23 Existing Senior Secured Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.24 Issuance of the New Senior Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
5.25 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 6. Affirmative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.01 Information Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.02 Books, Records, Inspections and Annual Meetings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.03 Maintenance of Property; Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.04 Corporate Franchises . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.05 Compliance with Statutes, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.06 Compliance with Environmental Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.07 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.08 End of Fiscal Years; Fiscal Quarters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.09 Performance of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.10 Payment of Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
6.11 Additional Security; Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 7. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
7.01 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
7.02 Consolidation, Merger, Purchase or Sale of Assets, etc. . . . . . . . . . . . . . . . . . . . . . . . . 3
7.03 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4
7.04 Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.05 Advances, Investments and Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.06 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.07 Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.08 Capital Expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.09 Consolidated Interest Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.10 Maximum Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.11 Minimum Consolidated EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.12 Consolidated Fixed Charge Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.13 Limitation on Payments of Certain Indebtedness; Modifications of Certain Indebtedness;
Modifications of Certificate of Incorporation, By-Laws and Certain Other Agreements; etc. . . . . 4
7.14 Limitation on Certain Restrictions on Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.15 Limitation on Issuance of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.16 Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
7.17 Limitation on Creation of Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 8. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.01 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.02 Representations, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.03 Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.04 Default Under Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.05 Bankruptcy, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.06 Security Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.07 Subsidiaries Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.08 Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
8.09 Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 9. Definitions and Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
9.01 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 10. The Administrative Agent and the Syndication Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.01 Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.02 Nature of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.03 Lack of Reliance on the Administrative Agent and the Syndication Agent . . . . . . . . . . . . . . . . 4
10.04 Certain Rights of the Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.05 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.06 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.07 The Administrative Agent and the Syndication Agent in their Individual Capacity . . . . . . . . . . . . 4
10.08 Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
10.09 Resignation by the Administrative Agent and the Syndication Agent . . . . . . . . . . . . . . . . . . . 4
SECTION 11. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
11.01 Payment of Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
11.02 Right of Setoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
11.03 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5
11.04 Benefit of Agreement; Assignments; Participations . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.05 No Waiver; Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.06 Payments Pro Rata . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.07 Calculations; Computations; Accounting Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL . . . . . . . . . . . . . . . . 5
11.09 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.10 Effectiveness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.11 Headings Descriptive . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.12 Amendment or Waiver; etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.13 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.14 Domicile of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.15 Register . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
11.16 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SCHEDULE 1.01(a) Commitments
SCHEDULE 1.01(b) Bank Addresses
SCHEDULE 5.09 Certain Tax Matters
SCHEDULE 5.10 Plans
SCHEDULE 5.11 Real Properties
SCHEDULE 5.14 Capitalization
SCHEDULE 5.15 Subsidiaries
SCHEDULE 5.19 Certain Environmental Matters
SCHEDULE 5.22 Existing Indebtedness
SCHEDULE 5.25 Insurance
SCHEDULE 7.01 Existing Liens
SCHEDULE 7.05 Existing Investments
SCHEDULE 7.06 Certain Transactions with Affiliates
SCHEDULE 9.01 Certain Take-or-Pay Obligations
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EXHIBIT A Notice of Borrowing
EXHIBIT B Note
EXHIBIT C Section 3.04(b)(ii) Certificate
EXHIBIT D-1 Opinion of Ungaretti & Xxxxxx, Special Counsel to the Credit Parties
EXHIBIT D-2 Opinion of Xxxxxx X. Xxxxx, Esq., General Counsel to the Borrower
EXHIBIT E Officers' Certificate
EXHIBIT F Collateral Agency Agreement
EXHIBIT G Pledge Agreement
EXHIBIT H Security Agreement
EXHIBIT I Subsidiaries Guaranty
EXHIBIT J Solvency Certificate
EXHIBIT K Assignment and Assumption Agreement
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[CONFORMED COPY WITH
EXHIBITS G, H, AND I
CONFORMED AS EXECUTED]
CREDIT AGREEMENT, dated as of December 18, 1997, among ACME METALS
INCORPORATED, a Delaware corporation (the "Borrower"), the Lenders party hereto
from time to time, BANKERS TRUST COMPANY, as Administrative Agent, and XXXXXX
XXXXXXX SENIOR FUNDING, INC., as Syndication Agent and Arranger (all
capitalized terms used herein and defined in Section 9 are used herein as
therein defined).
W I T N E S S E T H:
WHEREAS, subject to and upon the terms and conditions set forth
herein, the Lenders are willing to make available to the Borrower the credit
facility provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitment. Subject to and upon the terms and conditions set forth
herein, each Lender severally agrees to make a term loan (each a "Loan" and,
collectively, the "Loans") to the Borrower, which Loans (i) only may be
incurred by the Borrower pursuant to a single drawing to be made on the
Effective Date, (ii) shall, at the option of the Borrower, be incurred and
maintained as, and/or converted into, Base Rate Loans or Eurodollar Loans,
provided that (A) except as otherwise specifically provided in Section 1.10(b),
all Loans comprising the same Borrowing shall at all times be of the same Type
and (B) unless the Syndication Agent has determined (and has notified the
Borrower) that the Syndication Date has occurred (at which time this clause (B)
shall no longer be applicable), no more than three Borrowings of Loans to be
maintained as Eurodollar Loans may be incurred prior to the 90th day after
the Effective Date (each of which Borrowings of Eurodollar Loans may only have
an Interest Period of one month, and the first of which Borrowings may only be
made on the Effective Date or on or prior to the sixth Business Day after the
Effective Date, the second of which Borrowings may only be made on the last day
of the Interest Period of the first such Borrowing and the third of which
Borrowings may only be made on the last day of the Interest Period of the
second such Borrowing) and (iii) shall be made by each Lender in that aggregate
principal amount which equals the Commitment of such Lender on the Effective
Date as such Commitment is set forth on Schedule 1.01(a) (before giving effect
to the termination thereof on such date pursuant to Section 2.02(b)). Once
repaid, Loans incurred hereunder may not be reborrowed.
1.02 Minimum Amount of Each Borrowing. The aggregate principal amount of each
Borrowing of Loans shall not be less than the Minimum Borrowing Amount. More
than one Borrowing may occur on the same date, but at no time shall there be
outstanding more than five Borrowings of Eurodollar Loans.
1.03 Notice of Borrowing. When the Borrower desires to incur the Loans
hereunder, the Borrower shall give the Administrative Agent at the Notice
Office at least three Business Days' prior notice thereof in the case of the
incurrence of Eurodollar Loans or at least one Business Day's prior notice
thereof in the case of the incurrence of Base Rate Loans, provided that any
such notice shall be deemed to have been given on a certain day only if given
before 11:00 A.M. (New York time) on such day. Such notice (the "Notice of
Borrowing"), except as otherwise expressly provided in Section 1.10, shall be
irrevocable and shall be given by the Borrower in writing in the form of
Exhibit A, appropriately completed to specify the aggregate principal amount of
the Loans to be incurred on the Effective Date (which shall be a Business Day)
and whether such Loans are to be incurred as Base Rate Loans or Eurodollar
Loans. The Administrative Agent shall promptly give
8
each Lender notice of such proposed Borrowing, of such Lender's proportionate
share thereof and of the other matters required by the immediately preceding
sentence to be specified in the Notice of Borrowing.
1.04 Disbursement of Funds. No later than 12:00 Noon (New York time) on the
Effective Date, each Lender will make available its pro rata portion
(determined in accordance with Section 1.07) of the Borrowing requested to be
made on such date. All such amounts will be made available in Dollars and in
immediately available funds at the Payment Office, and the Administrative Agent
will make available to the Borrower at the Payment Office the aggregate of the
amounts so made available by the Lenders. Unless the Administrative Agent
shall have been notified by any Lender prior to the Effective Date that such
Lender does not intend to make available to the Administrative Agent such
Lender's portion of the Borrowing to be made on such date, the Administrative
Agent may assume that such Lender has made such amount available to the
Administrative Agent on such date and the Administrative Agent shall, in
reliance upon such assumption, make available to the Borrower a corresponding
amount. If such corresponding amount is not in fact made available to the
Administrative Agent by such Lender, the Administrative Agent shall be entitled
to recover such corresponding amount on demand from such Lender. The
Administrative Agent also shall be entitled to recover on demand from such
Lender interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative Agent
to the Borrower until the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to the overnight Federal Funds
Rate. Nothing in this Section 1.04 shall be deemed to relieve any Lender from
its obligation to make its Loan hereunder or to prejudice any rights which the
Borrower may have against any Lender as a result of any failure by such Lender
to make its Loan hereunder.
1.05 Notes. (a) The Borrower's obligation to pay the principal of, and
interest on, the Loan made by each Lender shall be evidenced by a promissory
note duly executed and delivered by the Borrower substantially in the form of
Exhibit B, with blanks appropriately completed in conformity herewith (each a
"Note" and, collectively, the "Notes"). The Note issued to each Lender shall
(i) be executed by the Borrower, (ii) be payable to such Lender or its
registered assigns and be dated the Effective Date (or, if issued after the
Effective Date, be dated the date of the issuance thereof), (iii) be in a
stated principal amount equal to the Loan made by such Lender on the Effective
Date (or, if issued after the Effective Date, be in a stated principal amount
equal to the outstanding principal amount of the Loan of such Lender at such
time) and be payable in the outstanding principal amount of the Loan evidenced
thereby, (iv) mature on the Maturity Date, (v) bear interest as provided in the
appropriate clause of Section 1.08 in respect of the Base Rate Loans and
Eurodollar Loans, as the case may be, evidenced thereby, (vi) be subject to
voluntary prepayment as provided in Section 3.01, and mandatory repayment as
provided in Section 3.02, and (vii) be entitled to the benefits of this
Agreement and the other Credit Documents.
(b) Each Lender will note on its internal records the amount of the Loan made
by it and each payment in respect thereof and will prior to any transfer of its
Note endorse on the reverse side thereof the outstanding principal amount of
the Loan evidenced thereby. Failure to make any such notation or any error in
such notation shall not affect the Borrower's obligations in respect of such
Loan.
1.06 Conversions. The Borrower shall have the option to convert, on any
Business Day occurring after the Effective Date, all or a portion equal to at
least the Minimum Borrowing Amount of the outstanding principal amount of Loans
made pursuant to one or more Borrowings of one or more Types of Loans into a
Borrowing of another Type of Loan, provided that, (i) except as otherwise
provided in Section 1.10(b), Eurodollar Loans may be converted into Base Rate
Loans only on the last day of an Interest Period applicable to the Eurodollar
Loans being converted and no such partial conversion of Eurodollar Loans shall
reduce the outstanding principal amount of such Eurodollar Loans made pursuant
to a single Borrowing to less than the Minimum Borrowing Amount, (ii) Base
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Rate Loans may only be converted into Eurodollar Loans if no Default or Event
of Default is in existence on the date of the conversion, (iii) unless the
Syndication Agent has determined (and has notified the Borrower) that the
Syndication Date has occurred (at which time this clause (iii) shall no longer
be applicable), prior to the 90th day after the Effective Date, conversions of
Base Rate Loans into Eurodollar Loans may only be made if any such conversion
is effective on the first day of the first, second or third Interest Period
referred to in clause (B) of Section 1.01(ii) and so long as such conversion
does not result in a greater number of Borrowings of Eurodollar Loans prior to
the 90th day after the Effective Date as are permitted under such Section
1.01(ii) and (iv) no conversion pursuant to this Section 1.06 shall result in a
greater number of Borrowings of Eurodollar Loans than is permitted under
Section 1.02. Each such conversion shall be effected by the Borrower by giving
the Administrative Agent at the Notice Office prior to 11:00 A.M. (New York
time) at least three Business Days' prior notice (each a "Notice of
Conversion") specifying the Loans to be so converted, the Borrowing or
Borrowings pursuant to which such Loans were made and, if to be converted into
Eurodollar Loans, the Interest Period to be initially applicable thereto. The
Administrative Agent shall give each Lender prompt notice of any such proposed
conversion. Upon any such conversion the proceeds thereof will be deemed to be
applied directly on the day of such conversion to prepay the outstanding
principal amount of the Loans being converted.
1.07 Pro Rata Borrowings. All Borrowings of Loans under this Agreement shall
be incurred from the Lenders pro rata on the basis of their Commitments. It is
understood that no Lender shall be responsible for any default by any other
Lender of its obligation to make its Loan hereunder and that each Lender shall
be obligated to make the Loan provided to be made by it hereunder, regardless
of the failure of any other Lender to make its Loan hereunder.
1.08 Interest.
(a) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Base Rate Loan from the date of
Borrowing thereof until the earlier of (i) the maturity
thereof (whether by acceleration or otherwise) and (ii) the
conversion of such Base Rate Loan to a Eurodollar Loan
pursuant to Section 1.06 at a rate per annum which shall be
equal to the sum of the Applicable Base Rate Margin plus the
Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date of
Borrowing thereof until the earlier of (i) the maturity
thereof (whether by acceleration or otherwise) and (ii) the
conversion of such Eurodollar Loan to a Base Rate Loan
pursuant to Section 1.06, 1.09 or 1.10, as applicable, at a
rate per annum which shall, during each Interest Period
applicable thereto, be equal to the sum of the Applicable
Eurodollar Rate Margin plus the Eurodollar Rate for such
Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount
payable hereunder shall, in each case, bear interest at a rate
per annum equal to the greater of (x) the rate which is 2% in
excess of the rate then borne by such Loans and (y) the rate
which is 2% in excess of the rate otherwise applicable to Base
Rate Loans from time to time. Interest which accrues under
this Section 1.08(c) shall be payable on demand.
10
(d) Accrued (and theretofore unpaid) interest shall be payable (i)
in respect of each Base Rate Loan, quarterly in arrears on
each Quarterly Payment Date, (ii) in respect of each
Eurodollar Loan, on the last day of each Interest Period
applicable thereto and, in the case of an Interest Period in
excess of three months, on each date occurring at three month
intervals after the first day of such Interest Period and
(iii) in respect of each Loan, on any repayment or prepayment
(on the amount repaid or prepaid), at maturity (whether by
acceleration or otherwise) and, after such maturity, on
demand.
(e) Upon each Interest Determination Date, the Administrative
Agent shall determine the Eurodollar Rate for each Interest
Period applicable to Eurodollar Loans and shall promptly
notify the Borrower and the Lenders thereof. Each such
determination shall, absent manifest error, be final and
conclusive and binding on all parties hereto.
1.09 Interest Periods. At the time the Borrower gives the Notice of Borrowing
or any Notice of Conversion in respect of the incurrence of, or the conversion
into, any Eurodollar Loan (in the case of the initial Interest Period
applicable thereto) or on the third Business Day prior to the expiration of an
Interest Period applicable to such Eurodollar Loan (in the case of any
subsequent Interest Period), the Borrower shall have the right to elect, by
giving the Administrative Agent notice thereof, the interest period (each an
"Interest Period") applicable to such Eurodollar Loan, which Interest Period
shall, at the option of the Borrower (but otherwise subject to the limitation
set forth in clause (B) of the proviso in Section 1.01(ii)), be a one, two,
three or six-month period, provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan
(including the date of any conversion thereto from a Base Rate
Loan) and each Interest Period occurring thereafter in respect
of such Eurodollar Loan shall commence on the day on which the
next preceding Interest Period applicable thereto expires;
(iii) if any Interest Period for a Eurodollar Loan begins on a day
for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period, such
Interest Period shall end on the last Business Day of such
calendar month;
(iv) if any Interest Period for a Eurodollar Loan would otherwise
expire on a day which is not a Business Day, such Interest
Period shall expire on the next succeeding Business Day,
provided, however, that if any Interest Period for a
Eurodollar Loan would otherwise expire on a day which is not a
Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall
expire on the next preceding Business Day;
(v) no Interest Period may be selected at any time when a Default
or an Event of Default is then in existence;
(vi) no Interest Period in respect of any Borrowing of Eurodollar
Loans shall be selected which extends beyond the Maturity
Date; and
(vii) no Interest Period in respect of any Borrowing of Eurodollar
Loans shall be selected which extends beyond any date upon
which a mandatory repayment of Loans will be required to be
made under Section 3.02(a), if the aggregate principal amount
of Eurodollar Loans which have Interest Periods which will
expire after such date will be in excess of the aggregate
principal amount of Loans then outstanding less the aggregate
amount of such required repayment.
If upon the expiration of any Interest Period applicable to a Borrowing of
Eurodollar Loans, the Borrower has failed to elect, or is not permitted to
elect, a new Interest Period to be applicable to such Eurodollar Loans as
provided above, the Borrower shall be deemed to have elected to convert such
Eurodollar Loans into Base Rate Loans effective as of the expiration date of
such current Interest Period.
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1.10 Increased Costs, Illegality, etc. (a) In the event that any Lender
shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the
interbank Eurodollar market, adequate and fair means do not
exist for ascertaining the applicable interest rate on the
basis provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Lender shall incur increased costs or
reductions in the amounts received or receivable hereunder
with respect to any Eurodollar Loan because of (x) any change
since the date of this Agreement in any applicable law or
governmental (including any NAIC) rule, regulation, order,
guideline or request (whether or not having the force of law)
or in the interpretation or administration thereof, and
including the introduction of any new law or governmental
(including any NAIC) rule, regulation, order, guideline or
request, such as, for example, but not limited to: (A) a
change in the basis of taxation of payment to any Lender of
the principal of or interest on the Notes or any other amounts
payable hereunder (except for changes in the rate of tax on,
or determined by reference to, the net income or profits of
such Lender pursuant to the laws of the jurisdiction in which
such Lender is organized or in which such Lender's principal
office or applicable lending office is located or any
subdivision thereof or therein) or (B) a change in official
reserve requirements, but, in all events, excluding reserves
required under Regulation D to the extent included in the
computation of the Eurodollar Rate and/or (y) other
circumstances since the date of this Agreement affecting such
Lender, the interbank Eurodollar market or the position of
such Lender in such market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan has been made (x) unlawful by any law or governmental
(including any NAIC) rule, regulation or order, (y) impossible
by compliance by any Lender in good faith with any
governmental (including any NAIC) request (whether or not
having force of law) or (z) impracticable as a result of a
contingency occurring after the date of this Agreement which
materially and adversely affects the interbank Eurodollar
market; then, and in any such event, such Lender (or the
Administrative Agent, in the case of clause (i) above) shall
promptly give notice (by telephone promptly confirmed in
writing) to the Borrower and, except in the case of clause (i)
above, to the Administrative Agent of such determination
(which notice the Administrative Agent shall promptly transmit
to each of the other Lenders). Thereafter (x) in the case of
clause (i) above, Eurodollar Loans shall no longer be
available until such time as the Administrative Agent notifies
the Borrower and the Lenders that the circumstances giving
rise to such notice by the Administrative Agent no longer
exist, and the Notice of Borrowing or any Notice of Conversion
given by the Borrower with respect to Eurodollar Loans which
have not yet been incurred (including by way of conversion)
shall be deemed rescinded by the Borrower, (y) in the case of
clause (ii) above, the Borrower shall pay to such Lender, upon
such Lender's written request therefor, such additional
amounts (in the form of an increased rate of, or a different
method of calculating, interest or otherwise as such Lender in
its sole discretion shall
12
determine) as shall be required to compensate such Lender for
such increased costs or reductions in amounts received or
receivable hereunder
(a) Written notice as to the additional amounts owed to such
Lender, showing in reasonable detail the basis for the
calculation thereof, submitted to the Borrower by such Lender
shall, absent manifest error, be final and conclusive and
binding on all the parties hereto) and (z) in the case of
clause (iii) above, the Borrower shall take one of the actions
specified in Section 1.10(b) as promptly as possible and, in
any event, within the time period required by law.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the
Borrower may (and in the case of a Eurodollar Loan affected by
the circumstances described in Section 1.10(a)(iii) shall)
either (x) if the affected Eurodollar Loan is then being made
initially or pursuant to a conversion, cancel such Borrowing
by giving the Administrative Agent telephonic notice
(confirmed in writing) on the same date that the Borrower was
notified by the affected Lender or the Administrative Agent
pursuant to Section 1.10(a)(ii) or (iii) or (y) if the
affected Eurodollar Loan is then outstanding, upon at least
three Business Days' written notice to the Administrative
Agent, require the affected Lender to convert such Eurodollar
Loan into a Base Rate Loan, provided that, if more than one
Lender is affected at any time, then all affected Lenders must
be treated the same pursuant to this Section 1.10(b).
(c) If any Lender determines that after the date of this Agreement
the introduction of or any change in any applicable law or
governmental (including any NAIC) rule, regulation, order,
guideline, directive or request (whether or not having the
force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by any governmental
authority (including the NAIC), central bank or comparable
agency, will have the effect of increasing the amount of
capital required or expected to be maintained by such Lender
or any corporation controlling such Lender based on the
existence of such Lender's Commitments hereunder or its
obligations hereunder, then the Borrower shall pay to such
Lender, upon its written demand therefor, such additional
amounts as shall be required to compensate such Lender or such
other corporation for the increased cost to such Lender or
such other corporation or the reduction in the rate of return
to such Lender or such other corporation as a result of such
increase of capital. In determining such additional amounts,
each Lender will act reasonably and in good faith and will use
averaging and attribution methods which are reasonable,
provided that such Lender's determination of compensation
owing under this Section 1.10(c) shall, absent manifest error,
be final and conclusive and binding on all the parties hereto.
Each Lender, upon determining that any additional amounts will
be payable pursuant to this Section 1.10(c), will give prompt
written notice thereof to the Borrower, which notice shall
show in reasonable detail the basis for calculation of such
additional amounts.
1.11 Compensation. The Borrower shall compensate each Lender, upon its
written request (which request shall set forth in reasonable detail the basis
for requesting such compensation), for all reasonable losses, expenses and
liabilities (including, without limitation, any loss, expense or liability
incurred by reason of the liquidation or reemployment of deposits or other
funds required by such Lender to fund its Eurodollar Loans but excluding loss
of anticipated profits) which such Lender may sustain: (i) if for any reason
(other than a default by such Lender or the Administrative Agent) a Borrowing
of Eurodollar Loans does not occur on a date specified therefor in the Notice
of Borrowing or in a Notice of Conversion (whether or not withdrawn by the
Borrower or deemed withdrawn pursuant to Section 1.10(a)); (ii) if any
repayment (including any repayment made pursuant to Section 3.01, Section 3.02
or as a result of an acceleration of the Loans pursuant to Section 8) or
conversion of any of its Eurodollar Loans occurs on a date which is not the
last day of an
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Interest Period with respect thereto; (iii) if any prepayment of any of its
Eurodollar Loans is not made on any date specified in a notice of prepayment
given by the Borrower; or (iv) as a consequence of (x) any other default by the
Borrower to repay such Lender's Loans when required by the terms of this
Agreement or the Note held by such Lender or (y) any election made pursuant to
Section 1.10(b).
1.12 Change of Lending Office. Each Lender agrees that upon the occurrence of
any event giving rise to the operation of Section 1.10(a)(ii) or (iii), Section
1.10(c) or Section 3.04 with respect to such Lender, it will, if requested by
the Borrower, use reasonable efforts (subject to overall policy considerations
of such Lender) to designate another lending office for any Loans affected by
such event, provided that such designation is made on such terms that such
Lender and its lending office suffer no economic, legal or regulatory
disadvantage, with the object of avoiding the consequence of the event giving
rise to the operation of such Section. Nothing in this Section 1.12 shall
affect or postpone any of the obligations of the Borrower or the right of any
Lender provided in Sections 1.10 and 3.04.
1.13 Replacement of Lenders. (x) Upon the occurrence of an event giving rise
to the operation of Section 1.10(a)(ii) or (iii), Section 1.10(c) or Section
3.04 with respect to any Lender which results in such Lender charging to the
Borrower increased costs in excess of those being generally charged by the
other Lenders or (y) in the case of a refusal by a Lender to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Lenders as (and to the
extent) provided in Section 11.12(b), the Borrower shall have the right, if no
Default or Event of Default then exists (or, in the case of preceding clause
(y), no Default or Event of Default will exist immediately after giving effect
to such replacement), to replace such Lender (the "Replaced Lender") with one
or more other Eligible Transferees (collectively, the "Replacement Lender"),
each of whom shall be required to be reasonably acceptable to the
Administrative Agent, provided that (i) at the time of any replacement pursuant
to this Section 1.13, the Replacement Lender shall enter into one or more
Assignment and Assumption Agreements pursuant to Section 11.04(b) (and with all
fees payable pursuant to said Section 11.04(b) to be paid by the Replacement
Lender) pursuant to which the Replacement Lender shall acquire the outstanding
Loan of the Replaced Lender and, in connection therewith, shall pay to the
Replaced Lender in respect thereof an amount equal to the sum of (I) an amount
equal to the principal of, and all accrued interest on, the outstanding Loan of
the Replaced Lender and (II) an amount equal to all accrued, but theretofore
unpaid, Fees, if any, owing to the Replaced Lender pursuant to Section 2.01 and
(ii) all obligations of the Borrower due and owing to the Replaced Lender at
such time (other than those specifically described in clause (i) above in
respect of which the assignment purchase price has been, or is concurrently
being, paid) shall be paid in full to such Replaced Lender concurrently with
such replacement. Upon the execution of the respective Assignment and
Assumption Agreement, the payment of amounts referred to in clauses (i) and
(ii) above and, if so requested by the Replacement Lender, delivery to the
Replacement Lender of the appropriate Note executed by the Borrower, the
Replacement Lender shall become a Lender hereunder and the Replaced Lender
shall cease to constitute a Lender hereunder, except with respect to
indemnification provisions under this Agreement (including, without limitation,
Sections 1.10, 1.11, 3.04, 10.06 and 11.01), which shall survive as to such
Replaced Lender.
14
SECTION 2. Fees; Termination of Commitments.
2.01 Fees. The Borrower agrees to pay to the Agents, for their own account,
such fees as have been agreed to in a separate letter agreement, dated November
19, 1997, among the Borrower and the Agents in accordance with the terms
thereof.
2.02 Termination of Commitments.
(a) The Total Commitment (and the Commitment of each Lender) shall
terminate in its entirety on March 1, 1998 unless the
Effective Date has occurred on or before such date.
(b) In addition, the Total Commitment (and the Commitment of each
Lender) shall terminate in its entirety on the Effective Date
(after giving effect to the incurrence of the Loans on such
date) or at 5:00 p.m. (New York time) on such date to the
extent no Loans are incurred on such date).
SECTION 3. Prepayments; Payments; Taxes.
3.01 Voluntary Prepayments.
(a) The Borrower shall have the right to prepay the Loans, without
premium (except as provided below) or penalty, in whole or in
part at any time and from time to time on the following terms
and conditions: (i) the Borrower shall give the Administrative
Agent prior to 12:00 Noon (New York time) at the Notice Office
(x) at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) of its intent
to prepay Base Rate Loans and (y) at least three Business
Days' prior written notice (or telephonic notice promptly
confirmed in writing) of its intent to prepay Eurodollar
Loans, the principal amount of such prepayment and the Types
of Loans to be prepaid and, in the case of Eurodollar Loans,
the specific Borrowing or Borrowings pursuant to which made,
which notice the Administrative Agent shall promptly transmit
to each of the Lenders; (ii) each partial prepayment of Loans
pursuant to this Section 3.01(a) shall be in an aggregate
principal amount of at least $1,000,000, provided that if any
partial prepayment of Eurodollar Loans made pursuant to any
Borrowing shall reduce the outstanding principal amount of
Eurodollar Loans made pursuant to such Borrowing to an amount
less than the Minimum Borrowing Amount, then such Borrowing
may not be continued as a Borrowing of Eurodollar Loans and
any election of an Interest Period with respect thereto given
by the Borrower shall have no force or effect; (iii) each
prepayment pursuant to this Section 3.01(a) in respect of any
Loans made pursuant to a Borrowing shall be applied pro rata
among such Loans; (iv) each voluntary prepayment of Loans
pursuant to this Section 3.01(a) shall be applied to reduce
the then remaining Scheduled Repayments of Loans on a pro rata
basis (based upon the then remaining unpaid principal amounts
of such Scheduled Repayments after giving effect to all prior
reductions thereto); and (v) in the case of any voluntary
prepayment of Loans pursuant to this Section 3.01(a) (x) made
on or prior to December 31, 1998, such prepayment shall be in
an amount equal to the product of (A) the principal amount
specified pursuant to clause (i) of this Section 3.01(a)
multiplied by (B) 101.5% and (y) made on and after January 1,
1999 and on or before June 30, 1999, such prepayment shall be
in an amount equal to the product of (A) the principal amount
specified pursuant to clause (i) of this Section 3.01(a)
multiplied by (B) 101%.
(b) In the event of a refusal by a Lender to consent to certain
proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the
Required Lenders as (and to the extent) provided in Section
11.12(b), the Borrower may, upon five Business Days' prior
written notice to the Administrative
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Agent at the Notice Office (which notice the Administrative
Agent shall promptly transmit to each of the Lenders) repay
the outstanding Loan of, together with accrued and unpaid
interest, Fees and other amounts owing to, such Lender in
accordance with, and subject to the requirements of, said
Section 11.12(b) so long as the consents, if any, required
under Section 11.12(b) in connection with the repayment
pursuant to this clause (b) have been obtained. Each
voluntary prepayment of Loans pursuant to this Section 3.01(b)
shall be applied to reduce the then remaining Scheduled
Repayments of Loans on a pro rata basis (based upon the then
remaining unpaid principal amounts of such Scheduled
Repayments after giving effect to all prior reductions
thereto).
3.02 Mandatory Repayments and Commitment Reductions.
(a) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each date set forth below, the Borrower shall
be required to repay that principal amount of Loans, to the
extent then outstanding, as is set forth opposite such date
below (each such repayment, as the same may be reduced as
provided in Sections 3.01(a), 3.01(b) and 3.02(g), a
"Scheduled Repayment"):
Scheduled Repayment Date Amount
------------------------ ------
March 1, 1998 $250,000
June 1, 1998 $250,000
September 1, 1998 $250,000
December 1, 1998 $250,000
March 1, 1999 $250,000
June 1, 1999 $250,000
September 1, 1999 $250,000
December 1, 1999 $250,000
March 1, 2000 $250,000
June 1, 2000 $250,000
September 1, 2000 $250,000
December 1, 2000 $250,000
March 1, 2001 $250,000
June 1, 2001 $250,000
September 1, 2001 $250,000
December 1, 2001 $250,000
March 1, 2002 $250,000
June 1, 2002 $250,000
September 1, 2002 $250,000
December 1, 2002 $250,000
March 1, 2003 $250,000
June 1, 2003 $250,000
September 1, 2003 $250,000
December 1, 2003 $250,000
March 1, 2004 $21,125,000
June 1, 2004 $21,125,000
September 1, 2004 $21,125,000
December 1, 2004 $21,125,000
March 1, 2005 $21,125,000
June 1, 2005 $21,125,000
September 1, 2005 $21,125,000
Maturity Date $21,125,000
16
(b) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each date on or after the Effective Date upon
which the Borrower or any of its Subsidiaries receives any
cash proceeds from any capital contribution or any sale or
issuance of its equity (other than cash proceeds received (i)
from the issuance by the Borrower of shares of its common
stock so long as (x) no Default or Event of Default then
exists and (y) such cash proceeds are used, or the Borrower or
Acme Steel has adopted and begun the implementation of a plan
for the use of such cash proceeds, within six months following
receipt of same to fund the Phase II Expansion, (ii) from
equity contributions to any Subsidiary of the Borrower to the
extent made by the Borrower or another Subsidiary of the
Borrower, (iii) from the issuance by the Borrower of shares of
its common stock (including as a result of the exercise of any
options with regard thereto), or options to purchase shares of
its common stock, to officers, directors and employees of the
Borrower and its Subsidiaries or (iv) from the issuance by the
Borrower of shares of its common stock (including as a result
of the exercise of any options with regard thereto), or
options to purchase shares of its common stock, to the extent
such proceeds are promptly used by the Borrower to fund one or
more of its pension plans), an amount equal to 50% of the Net
Equity Proceeds of such capital contribution or sale or
issuance of equity shall be applied as a mandatory repayment
of principal of outstanding Loans in accordance with the
requirements of Sections 3.02(g) and (h).
(c) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each date on or after the Effective Date upon
which the Borrower or any of its Subsidiaries receives any
cash proceeds from any incurrence by the Borrower or any of
its Subsidiaries of Indebtedness for borrowed money (other
than Indebtedness for borrowed money permitted to be incurred
pursuant to Section 7.04 as such Section is in effect on the
Effective Date (other than Indebtedness incurred pursuant to
Section 7.04(xii) the proceeds of which shall be applied as
provided below in this Section 3.02(c))), an amount equal to
100% of the Net Debt Proceeds of the respective incurrence of
Indebtedness for borrowed money shall be applied as a
mandatory repayment of principal of outstanding Loans in
accordance with the requirements of Sections 3.02(g) and (h).
(d) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each date on or after the Effective Date upon
which the Borrower or any of its Subsidiaries receives any
cash proceeds from any Asset Sale, an amount equal to 100% of
the Net Sale Proceeds from such Asset Sale shall be applied as
a
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mandatory repayment of principal of outstanding Loans in
accordance with the requirements of Sections 3.02(g) and (h);
provided that with respect to no more than $5,000,000 in the
aggregate of cash proceeds from Asset Sales in any fiscal year
of the Borrower, such Net Sale Proceeds therefrom shall not be
required to be so applied on such date so long as (i) no
Default or Event of Default then exists, (ii) the Borrower
delivers a certificate to the Administrative Agent on or prior
to such date stating that such Net Sale Proceeds shall be used
to purchase assets (other than current assets) used or useful
in the business of the Borrower and its Subsidiaries within
360 days following the date of such Asset Sale (which
certificate shall set forth the estimates of the proceeds to
be so expended) (it being understood that to the extent
Collateral is sold pursuant to such Asset Sale, the assets so
reinvested in also shall be property that constitutes
Collateral under the respective Security Documents) and (iii)
such Net Sale Proceeds are deposited on such date in a
Restricted Collateral Account, and provided further, that if
all or any portion of such Net Sale Proceeds not required to
be applied to the repayment of outstanding Loans are not so
reinvested in replacement assets within such 360 day period,
such remaining portion shall be applied on the last day of
such period as a mandatory repayment of principal of
outstanding Loans as provided above in this Section 3.02(d)
without regard to the immediately preceding proviso.
Notwithstanding anything to the contrary contained above in
this Section 3.02(d), until such time as all Existing Senior
Secured Notes either have been repaid in full or have been
defeased in accordance with the terms thereof, all Net Sale
Proceeds from any Asset Sale shall be deposited and applied in
the manner provided in the Collateral Agency Agreement and the
Existing Senior Secured Note Indentures.
(e) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each Excess Cash Payment Date, an amount
equal to 75% of the Excess Cash Flow of the Borrower for the
relevant Excess Cash Payment Period shall be applied as a
mandatory repayment of principal of outstanding Loans in
accordance with the requirements of Sections 3.02(g) and (h).
(f) In addition to any other mandatory repayments pursuant to this
Section 3.02, on each date on or after the Effective Date upon
which the Borrower or any of its Subsidiaries receives any
cash proceeds from any Recovery Event, an amount equal to 100%
of the Net Insurance Proceeds from such Recovery Event shall
be applied as a mandatory repayment of principal of
outstanding Loans in accordance with the requirements of
Sections 3.02(g) and (h), provided that so long as no Default
or Event of Default then exists, such Net Insurance Proceeds
shall not be required to be so applied on such date to the
extent that the Borrower has delivered a certificate to the
Administrative Agent on or prior to such date stating that
such Net Insurance Proceeds shall be used to replace or
restore any properties or assets in respect of which such Net
Insurance Proceeds were paid within 360 days following the
date of the receipt of such Net Insurance Proceeds (which
certificate shall set forth the estimates of the proceeds to
be so expended) and such Net Insurance Proceeds are deposited
on such date in a Restricted Collateral Account, and provided
further, that if all or any portion of such Net Insurance
Proceeds not required to be applied to the repayment of
outstanding Loans pursuant to the immediately preceding
proviso are not so used within 360 days after the date of the
receipt of such Net Insurance Proceeds, such remaining
18
portion shall be applied on the last day of such period as a
mandatory repayment of principal of outstanding Loans as
provided above in this Section 3.02(f) without regard to the
immediately preceding proviso. Notwithstanding anything to
the contrary contained above in this Section 3.02(f), until
such time as all Existing Senior Secured Notes either have
been repaid in full or have been defeased in accordance with
the terms thereof, all Net Insurance Proceeds from any
Recovery Event shall be deposited and applied in the manner
provided in the Collateral Agency Agreement and the Existing
Senior Secured Note Indentures.
(g) Each amount required to be applied to repay outstanding Loans
pursuant to Sections 3.02(b), (c), (d), (e) and (f) shall be
applied to reduce the then remaining Scheduled Repayments on a
pro rata basis (based upon the then remaining unpaid principal
amounts of such Scheduled Repayments after giving effect to
all prior reductions thereto).
(h) With respect to each repayment of Loans required by this
Section 3.02, the Borrower may designate the Types of Loans
which are to be repaid and, in the case of Eurodollar Loans,
the specific Borrowing or Borrowings pursuant to which made,
provided that: (i) repayments of Eurodollar Loans pursuant to
this Section 3.02 may only be made on the last day of an
Interest Period applicable thereto unless all Eurodollar Loans
with Interest Periods ending on such date of required
repayment and all Base Rate Loans have been paid in full; (ii)
if any repayment of Eurodollar Loans made pursuant to a single
Borrowing shall reduce the outstanding Eurodollar Loans made
pursuant to such Borrowing to an amount less than the Minimum
Borrowing Amount, such Borrowing shall be converted at the end
of the then current Interest Period into a Borrowing of Base
Rate Loans; and (iii) each repayment of any Loans made
pursuant to a Borrowing shall be applied pro rata among such
Loans. In the absence of a designation by the Borrower as
described in the preceding sentence, the Administrative Agent
shall, subject to the above, make such designation in its sole
discretion.
(i) Notwithstanding anything to the contrary contained in
this Agreement or in any other Credit Document, (i)
all then outstanding Loans shall be repaid in full on
the Maturity Date and (ii) all then outstanding Loans
shall be repaid in full on the date on which a Change
of Control occurs.
3.03 Method and Place of Payment. Except as otherwise specifically provided
herein, all payments under this Agreement or under any Note shall be made to
the Administrative Agent for the account of the Lender or Lenders entitled
thereto not later than 12:00 Noon (New York time) on the date when due and
shall be made in Dollars in immediately available funds at the Payment Office.
Whenever any payment to be made hereunder or under any Note shall be stated to
be due on a day which is not a Business Day, the due date thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest shall be payable at the applicable rate during such
extension.
3.04 Net Payments.
(a) All payments made by the Borrower hereunder or under any Note
will be made without setoff, counterclaim or other defense.
Except as provided in Section 3.04(b), all such payments will
be made free and clear of, and without deduction or
withholding for, any present or future taxes, levies, imposts,
duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any
political subdivision or taxing authority thereof or therein
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CONFORMED AS EXECUTED]
with respect to such payments (but excluding, except as
provided in the second succeeding sentence, any tax imposed on
or measured by the net income or profits of a Lender pursuant
to the laws of the jurisdiction in which it is organized or
the jurisdiction in which the principal office or applicable
lending office of such Lender is located or any subdivision
thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges (all such
non-excluded taxes, levies, imposts, duties, fees, assessments
or other charges being referred to collectively as "Taxes").
If any Taxes are so levied or imposed, the Borrower agrees to
pay the full amount of such Taxes, and such additional amounts
as may be necessary so that every payment of all amounts due
under this Agreement or under any Note, after withholding or
deduction for or on account of any Taxes, will not be less
than the amount provided for herein or in such Note. If any
amounts are payable in respect of Taxes pursuant to the
preceding sentence, the Borrower agrees to reimburse each
Lender, upon the written request of such Lender, for taxes
imposed on or measured by the net income or profits of such
Lender pursuant to the laws of the jurisdiction in which such
Lender is organized or in which the principal office or
applicable lending office of such Lender is located or under
the laws of any political subdivision or taxing authority of
any such jurisdiction in which such Lender is organized or in
which the principal office or applicable lending office of
such Lender is located and for any withholding of taxes as
such Lender shall determine are payable by, or withheld from,
such Lender, in respect of such amounts so paid to or on
behalf of such Lender pursuant to the preceding sentence and
in respect of any amounts paid to or on behalf of such Lender
pursuant to this sentence. The Borrower will furnish to the
Administrative Agent within 45 days after the date the payment
of any Taxes is due pursuant to applicable law certified
copies of tax receipts evidencing such payment by the
Borrower. The Borrower agrees to indemnify and hold harmless
each Lender, and reimburse such Lender upon its written
request, for the amount of any Taxes so levied or imposed and
paid by such Lender.
(b) Each Lender that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) for U.S.
federal income tax purposes agrees to deliver to the Borrower
and the Administrative Agent on or prior to the Effective
Date, or in the case of a Lender that is an assignee or
transferee of an interest under this Agreement pursuant to
Section 1.13 or 11.04 (unless the respective Lender was
already a Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or
transfer to such Lender, (i) two accurate and complete
original signed copies of Internal Revenue Service Form 4224
or 1001 (or successor forms) certifying to such Lender's
entitlement as of such date to a complete exemption from
United States withholding tax with respect to payments to be
made under this Agreement and under any Note, or (ii) if the
Lender is not a "bank" within the meaning of Section
881(c)(3)(A) of the Code and cannot deliver either Internal
Revenue Service Form 1001 or 4224 (or successor forms)
pursuant to clause (i) above, (x) a certificate substantially
in the form of Exhibit C (any such certificate, a "Section
3.04(b)(ii) Certificate") and (y) two accurate and complete
original signed copies of Internal Revenue Service Form W-8
(or successor form) certifying to such Lender's entitlement to
a complete exemption
20
from United States withholding tax with respect to payments of
interest to be made under this Agreement and under any Note.
In addition, each Lender agrees that from time to time after
the Effective Date, whenever a lapse in time or change in
circumstances renders the previous certification obsolete or
inaccurate in any material respect, such Lender will promptly
deliver to the Borrower and the Administrative Agent two new
accurate and complete original signed copies of Internal
Revenue Service Form 4224 or 1001 (or successor forms), or
Form W-8 (or successor form) and a Section 3.04(b)(ii)
Certificate, as the case may be, and such other forms as may
be required in order to confirm or establish the entitlement
of such Lender to a continued exemption from or reduction in
United States withholding tax with respect to payments under
this Agreement and any Note, or such Lender shall immediately
notify the Borrower and the Administrative Agent of its
inability to deliver any such Form or Certificate, in which
case such Lender shall not be required to deliver any such
Form or Certificate pursuant to this Section 3.04(b).
Notwithstanding anything to the contrary contained in Section
3.04(a), but subject to Section 11.04(b) and the immediately
succeeding sentence, (x) the Borrower shall be entitled, to
the extent it is required to do so by law, to deduct or
withhold income or similar taxes imposed by the United States
(or any political subdivision or taxing authority thereof or
therein) from interest, Fees or other amounts payable
hereunder for the account of any Lender which is not a United
States person (as such term is defined in Section 7701(a)(30)
of the Code) for U.S. Federal income tax purposes to the
extent that such Lender has not provided to the Borrower U.S.
Internal Revenue Service Forms that establish a complete
exemption from such deduction or withholding and (y) the
Borrower shall not be obligated pursuant to Section 3.04(a)
hereof to gross-up payments to be made to a Lender in respect
of income or similar taxes imposed by the United States if (I)
such Lender has not provided to the Borrower the Internal
Revenue Service Forms required to be provided to the Borrower
pursuant to this Section 3.04(b) or (II) in the case of a
payment, other than interest, to a Lender described in clause
(ii) above, to the extent that such Forms do not establish a
complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the
preceding sentence or elsewhere in this Section 3.04 and
except as set forth in Section 11.04(b), the Borrower agrees
to pay any additional amounts and to indemnify each Lender in
the manner set forth in Section 3.04(a) (without regard to the
identity of the jurisdiction requiring the deduction or
withholding) in respect of any Taxes deducted or withheld by
it as described in the immediately preceding sentence as a
result of any changes that are effective after the Effective
Date in any applicable law, treaty, governmental rule,
regulation, guideline or order, or in the interpretation
thereof, relating to the deducting or withholding of such
Taxes.
SECTION 4. Conditions Precedent. The occurrence of the Effective Date and the
obligation of each Lender to make its Loan hereunder on the Effective Date are
subject to the satisfaction of the following conditions:
4.01 Execution of Agreement. On or prior to the Effective Date, this
Agreement shall have been executed and delivered in accordance with Section
11.10.
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4.02 Notes. On the Effective Date, there shall have been delivered to the
Administrative Agent for the account of each of the Lenders the appropriate
Note executed by the Borrower, in the amount, maturity and as otherwise
provided herein.
4.03 Officer's Certificate. On the Effective Date, the Administrative Agent
shall have received a certificate, dated the Effective Date and signed on
behalf of the Borrower by the Chairman of the Board, the President, the Chief
Financial Officer, the Treasurer or any Vice President of the Borrower,
certifying on behalf of the Borrower that all of the conditions set forth in
Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12 and 4.21 have been satisfied on
such date.
4.04 Opinions of Counsel. On the Effective Date, the Administrative Agent
shall have received from (i) Ungaretti & Xxxxxx, special counsel to the Credit
Parties, an opinion addressed to the Administrative Agent, the Syndication
Agent, the Collateral Agent and each of the Lenders and dated the Effective
Date covering the matters set forth in Exhibit D-1 and such other matters
incident to the transaction contemplated herein as any Agent may reasonably
request, and (ii) Xxxxxx X. Xxxxx, Xx., Esq., general counsel to the Borrower,
an opinion addressed to the Administrative Agent, the Syndication Agent, the
Collateral Agent and each of the Lenders and dated the Effective Date, covering
the matters set forth in Exhibit D-2 and such other matters incident to the
transaction contemplated herein as any Agent may reasonably request.
4.05 Corporate Documents; Proceedings; etc.
(a) On the Effective Date, the Administrative Agent shall have
received a certificate from each Credit Party, dated the
Effective Date, signed by the Chairman of the Board, the
President, the Chief Financial Officer, the Treasurer or any
Vice President of such Credit Party, and attested to by the
Secretary or any Assistant Secretary of such Credit Party, in
the form of Exhibit E with appropriate insertions, together
with copies of the certificate of incorporation (or equivalent
organizational document) and by-laws of such Credit Party and
the resolutions of such Credit Party referred to in such
certificate, and the foregoing shall be in form and substance
reasonably acceptable to the Agents.
(b) All corporate and legal proceedings and all instruments and
agreements in connection with the transactions contemplated by
this Agreement and the other Documents shall be reasonably
satisfactory in form and substance to the Agents, and the
Administrative Agent shall have received all information and
copies of all documents and papers, including records of
corporate proceedings, governmental approvals, good standing
certificates and bring-down telegrams or facsimiles, if any,
which any Agent reasonably may have requested in connection
therewith, such documents and papers where appropriate to be
certified by proper corporate or governmental authorities.
4.06 Tax Sharing Agreements; Existing Indebtedness Agreements. On or prior to
the Effective Date, there shall have been delivered to the Administrative Agent
true and correct copies of the following documents:
(i) all tax sharing, tax allocation, tax indemnity and
other similar agreements entered into by the Borrower
or any of its Subsidiaries (collectively, the "Tax
Sharing Agreements"); and
22
(ii) all agreements evidencing or relating to any material
Indebtedness of the Borrower or any of its
Subsidiaries which is to remain outstanding after
giving effect to the incurrence of the Loans on the
Effective Date (collectively, the "Existing
Indebtedness Agreements").
4.07 New Senior Notes.
(a) On the Effective Date, (i) the Borrower shall have received
gross cash proceeds of $198,000,000 from the issuance by it of
the New Senior Notes and (ii) the Borrower shall have utilized
the full amount of the net cash proceeds received from the
issuance of the New Senior Notes to make payments owing in
connection with the Transaction prior to utilizing any
proceeds of the Loans for such purpose.
(b) On or prior to the Effective Date, there shall have been
delivered to the Administrative Agent true and correct copies
of the New Senior Note Documents, and all of the terms and
conditions of the New Senior Note Documents (including,
without limitation, amortization, maturities, interest rates,
covenants, defaults, remedies and sinking fund provisions)
shall be in substantial conformity with the description
thereof in the New Senior Note Offering Memorandum, and with
such other terms as are reasonably acceptable to the Agents.
4.08 Existing Senior Secured Notes Tender Offer, Existing Senior Secured
Notes Consents; Existing Senior Secured Notes Indenture Supplements.
(a) On the Effective Date, the Borrower shall have accepted for
payment all Existing 12-1/2% Senior Secured Notes and all
Existing 13-1/2% Senior Secured Discount Notes issued by it,
in each case to the extent tendered and not withdrawn pursuant
to the Existing Senior Secured Notes Tender Offer, and each of
the conditions to such purchase as set forth in the Existing
Senior Secured Notes Tender Offer Documents either shall have
been (i) satisfied or (ii) waived with the consent of the
Agents (it being understood that in any event at least 75% of
the aggregate outstanding principal amount of each of the
Existing 12-1/2% Senior Secured Notes and the Existing 13-1/2%
Senior Secured Discount Notes shall have been tendered and
purchased pursuant to the Existing Senior Secured Notes Tender
Offer). All terms and conditions of the Existing Senior
Secured Notes Tender Offer shall be in substantial conformity
with the Existing Senior Secured Notes Tender Offer Documents
dated November 13, 1997 and the Existing Senior Secured Notes
Tender Offer shall be effected in compliance with the Existing
Senior Secured Notes Tender Offer Documents (except to the
extent waived as described above) and all applicable laws
(including, without limitation, Federal and state securities
laws).
(b) (i) On the Effective Date, in the event that 100% of the
Existing 12-1/2% Senior Secured Notes have not been
accepted for payment by the Borrower pursuant to the
Existing Senior Secured Notes Tender Offer, the
Borrower shall have received sufficient Existing
12-1/2% Senior Secured Note Consents pursuant to the
Existing Senior Secured Notes Consent Solicitation to
authorize the execution and delivery of the Existing
12-1/2% Senior Secured Note Indenture Supplement (the
terms of which shall conform to the description
thereof set forth in the Existing Senior Secured
Notes Tender Offer Documents described above) and the
Existing 12-1/2% Senior Secured Note Indenture
Supplement shall have been duly executed and
delivered by the Borrower and the Existing 12-1/2%
Senior Secured Note Indenture Trustee and all
conditions to the effectiveness thereof shall have
been satisfied.
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CONFORMED AS EXECUTED]
(ii) On the Effective Date, in the event that 100% of the
Existing 13-1/2% Senior Secured Discount Notes have
not been accepted for payment by the Borrower
pursuant to the Existing Senior Secured Notes Tender
Offer, the Borrower shall have received sufficient
Existing 13-1/2% Senior Secured Discount Note
Consents pursuant to the Existing Senior Secured
Notes Consent Solicitation to authorize the execution
and delivery of the Existing 13-1/2% Senior Secured
Discount Note Indenture Supplement (the terms of
which shall conform to the description thereof in the
Existing Senior Secured Notes Tender Offer Documents
described above) and the Existing 13-1/2% Senior
Secured Discount Note Indenture Supplement shall have
been duly executed and delivered by the Borrower and
the Existing 13-1/2% Senior Secured Discount Note
Indenture Trustee and all conditions to the
effectiveness thereof shall have been satisfied.
(iii) On the Effective Date, in the event that 100% of each
of the Existing 12-1/2% Senior Secured Notes and the
Existing 13-1/2% Senior Secured Discount Notes have
not been accepted for payment by the Borrower
pursuant to the Existing Senior Secured Notes Tender
Offer, the collateral agent for the holders of the
Existing Senior Secured Notes, the Borrower, certain
other Credit Parties and the Collateral Agent shall
have entered into the Collateral Agency Agreement in
the form of Exhibit F (as amended, modified or
supplemented from time to time, the "Collateral
Agency Agreement").
(c) On the Effective Date, there shall have been delivered to the
Administrative Agent true and correct copies of all Existing
Senior Secured Notes Tender Offer Documents and Existing
Senior Secured Notes Consent Solicitation Documents (including
executed versions of each Existing Senior Secured Note
Indenture Supplement). The Administrative Agent shall have
received evidence in form, scope and substance satisfactory to
it that the matters set forth in this Section 4.08 have been
satisfied at such time.
4.09 Bank Refinancing. On the Effective Date, the Bank Refinancing shall
have been consummated. The Administrative Agent shall have received copies of
all documents executed in connection with the Bank Refinancing, all of which
shall be in full force and effect and in form and substance reasonably
satisfactory to the Agents.
4.10 Working Capital Facility. On the Effective Date, (i) the Working
Capital Facility shall have been amended and restated on terms and conditions,
and pursuant to documentation, reasonably satisfactory to the Agents and the
Required Lenders, (ii) the Administrative Agent shall have received true and
correct copies of the Working Capital Facility, as so amended and restated,
(iii) the Working Capital Facility, as so amended and restated, shall be in
full force and effect and no default or event of default shall exist thereunder
and (iv) the Borrower shall have used a portion of the proceeds of the Loans
and/or the New Senior Notes to repay outstanding loans under the Working
Capital Facility (it being understood and agreed that no more than $20,000,000
of such loans may be outstanding on the Effective Date after giving effect to
any repayment thereof on such date).
4.11 Adverse Change, etc.
(a) Since September 28, 1997, nothing shall have occurred (and
neither the Agents nor the Lenders shall have become aware of
any facts or conditions not previously
24
known) which the Agents or the Required Lenders shall
reasonably determine (x) has had, or could reasonably be
expected to have, a material adverse effect on the rights or
remedies of the Lenders or any Agent or on the ability of any
Credit Party to perform its obligations to them hereunder or
under any other Credit Document or (y) has had, or could
reasonably be expected to have, a material adverse effect on
the Transaction or on the business, operations, property,
assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a
whole.
(b) On or prior to the Effective Date, all necessary governmental
(domestic and foreign) and third party approvals and/or
consents in connection with the Transaction and the other
transactions contemplated by the Documents and otherwise
referred to herein or therein shall have been obtained and
remain in effect, and all applicable waiting periods with
respect thereto shall have expired without any action being
taken by any competent authority which restrains, prevents or
imposes materially adverse conditions upon the consummation of
the Transaction or the other transactions contemplated by the
Documents or otherwise referred to herein or therein.
Additionally, there shall not exist any judgment, order,
injunction or other restraint issued or filed or a hearing
seeking injunctive relief or other restraint pending or
notified prohibiting or imposing materially adverse conditions
upon the consummation of the Transaction or the other
transactions contemplated by the Documents or otherwise
required herein or therein.
4.12 Litigation. On the Effective Date, there shall be no actions, suits or
proceedings pending or threatened (i) with respect to the Transaction, this
Agreement or any other Document or (ii) which the Agents or the Required
Lenders shall reasonably determine could reasonably be expected to have a
material adverse effect on (a) the Transaction or on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole, (b) the rights or
remedies of the Lenders or any Agent hereunder or under any other Credit
Document or (c) the ability of any Credit Party to perform its respective
obligations to the Lenders or any Agent hereunder or under any other Credit
Document.
4.13 Pledge Agreement. On the Effective Date, each Credit Party shall have
duly authorized, executed and delivered the Pledge Agreement in the form of
Exhibit G (as amended, modified or supplemented from time to time, the "Pledge
Agreement") and the collateral agent under the Collateral Agency Agreement
shall have possession of all of the Pledged Stock, if any, referred to in the
Pledge Agreement and then owned by such Credit Party, together with executed
and undated stock powers, and the Administrative Agent shall have received
written confirmation from such collateral agent that it in fact has possession
of all such Pledged Stock.
4.14 Security Agreement. On the Effective Date, Acme Steel shall have duly
authorized, executed and delivered the Security Agreement in the form of
Exhibit H (as modified, supplemented or amended from time to time, the
"Security Agreement") covering all of Acme Steel's present and future Security
Agreement Collateral, together with:
(i) proper Financing Statements (Form UCC-1 or the
equivalent) fully executed for filing under the UCC
or other appropriate filing offices of each
jurisdiction as may be necessary or, in the
reasonable opinion of the Collateral Agent, desirable
to perfect the security interests purported to be
created by the Security Agreement;
(ii) certified copies of Requests for Information or
Copies (Form UCC-11), or equivalent reports, listing
all effective financing statements that name the
Borrower or any of its Subsidiaries as debtor (none
of which shall cover the Collateral except to the
extent evidencing Permitted Liens or in respect of
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which the Collateral Agent shall have received
termination statements (Form UCC-3 or the equivalent)
as shall be required by local law fully executed for
filing);
(iii) evidence of the completion of all other recordings
and filings of, or with respect to, the Security
Agreement as may be necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect
the security interests intended to be created by the
Security Agreement; and
(iv) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable
to perfect and protect the security interests
purported to be created by the Security Agreement
have been taken.
4.15 Subsidiaries Guaranty. On the Effective Date, each Subsidiary Guarantor
shall have duly authorized, executed and delivered the Subsidiaries Guaranty in
the form of Exhibit I (as amended, modified or supplemented from time to time,
the "Subsidiaries Guaranty").
4.16 Mortgages; Title Insurance; Survey; etc. On the Effective Date, the
Collateral Agent shall have received:
(i) fully executed counterparts of a Mortgage, in form
and substance reasonably satisfactory to the Agents,
which Mortgage shall cover the Mortgaged Properties
owned by Acme Steel on the Effective Date as
designated on Schedule 5.11, together with evidence
that counterparts of such Mortgage have been
delivered to the title insurance company insuring the
Lien of such Mortgage for recording in all places to
the extent necessary or, in the reasonable opinion of
the Collateral Agent, desirable, to effectively
create a valid and enforceable mortgage lien on each
such Mortgaged Property in favor of the Collateral
Agent (or such other trustee as may be required or
desired under local law) for the benefit of the
Secured Creditors;
(ii) a mortgagee title insurance policy (or a binding
commitment with respect thereto) (each, a "Mortgage
Policy") on the Mortgaged Properties issued by a
title insurer reasonably satisfactory to the Agents
in amounts satisfactory to the Agents assuring the
Collateral Agent that the Mortgage on such Mortgaged
Properties are valid and enforceable mortgage liens
on the respective Mortgaged Properties, free and
clear of all defects and encumbrances except
Permitted Encumbrances and such Mortgage Policy shall
otherwise be in form and substance reasonably
satisfactory to the Agents; and
(iii) a recent survey, in form and substance reasonably
satisfactory to the Agents, of Acme Steel's new
continuous slab facility, certified by a licensed
professional surveyor reasonably satisfactory to the
Agents, and existing surveys of Acme Steel's other
Mortgaged Properties, certified by the surveyor who
originally prepared such surveys.
4.17 Notice of Borrowing. On or prior to the Effective Date, the
Administrative Agent shall have received the Notice of Borrowing meeting the
requirements of Section 1.03.
4.18 Financial Statements; Pro Forma Financial Statements, Projections. On or
prior to the Effective Date, the Agents shall have received true and correct
copies of the historical financial statements, the pro forma financial
statements and the Projections referred to in Sections 5.05(a) and (d), which
26
historical financial statements, pro forma financial statements and Projections
shall be in form and substance reasonably satisfactory to the Agents.
4.19 Solvency Certificate; Environmental Analyses; Insurance Certificates.
On or prior to the Effective Date, the Administrative Agent shall have
received:
(i) a solvency certificate from the Chief Financial
Officer of the Borrower in the form of Exhibit J;
(ii) environmental and hazardous substance assessments and
analyses with respect to the Real Property of the
Borrower and its Subsidiaries in scope, and in form
and substance, reasonably satisfactory to the Agents;
and
(iii) certificates of insurance complying with the
requirements of Section 6.03 for the business and
properties of the Borrower and its Subsidiaries, in
form and substance reasonably satisfactory to the
Agents and naming the Collateral Agent as an
additional insured and, with respect to the Security
Agreement Collateral and the Mortgaged Properties, as
loss payee, and stating that such insurance shall not
be canceled without at least 30 days prior written
notice by the insurer to the Collateral Agent (or
such shorter period of time as a particular insurance
company generally provides).
4.20 Fees, etc. On the Effective Date, the Borrower shall have paid to the
Agents all costs, fees and expenses (including, without limitation, legal fees
and expenses) payable to the Agents to the extent then due.
4.21 No Default; Representations and Warranties. On the Effective Date and
also after giving effect to the incurrence of the Loans on such date (i) there
shall exist no Default or Event of Default and (ii) all representations and
warranties contained herein and in the other Credit Documents shall be true and
correct in all material respects with the same effect as though such
representations and warranties had been made on and as of such date (it being
understood and agreed that any representation or warranty which by its terms is
made as of a specified date shall be required to be true and correct in all
material respects only as of such specified date).
The occurrence of the Effective Date and the incurrence by the Borrower of the
Loans hereunder on such date shall constitute a representation and warranty by
the Borrower to each of the Agents and each of the Lenders that all the
conditions specified in this Section 4 exist as of that time. All of the
Notes, certificates, legal opinions and other documents and papers referred to
in this Section 4, unless otherwise specified, shall be delivered to the
Administrative Agent at the Notice Office for the account of each of the
Lenders and, except for the Notes, in sufficient counterparts or copies for
each of the Lenders and shall be in form and substance reasonably satisfactory
to the Agents and the Required Lenders.
SECTION 5. Representations, Warranties and Agreements. In order to induce the
Lenders to enter into this Agreement and to make the Loans hereunder, the
Borrower makes the following representations, warranties and agreements, in
each case, after giving effect to the Transaction, all of which shall survive
the execution and delivery of this Agreement and the Notes and the making of
the Loans, and with the occurrence of the Effective Date and incurrence by the
Borrower of the Loans hereunder on such date being deemed to constitute a
representation and warranty by the Borrower that the matters specified in this
Section 5 are true and correct in all material respects on and as of the
Effective Date (it being understood and agreed that any representation or
warranty which by its terms is made as of a specified date shall be required to
be true and correct in all material respects only as of such specified date).
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5.01 Corporate Status. Each of the Borrower and each of its Subsidiaries (i)
is a duly organized and validly existing corporation in good standing under the
laws of the jurisdiction of its organization, (ii) has the corporate power and
authority to own its property and assets and to transact the business in which
it is engaged and presently proposes to engage and (iii) is duly qualified and
is authorized to do business and is in good standing in each jurisdiction where
the ownership, leasing or operation of its property or the conduct of its
business requires such qualifications except for failures to be so qualified
which, individually or in the aggregate, could not reasonably be expected to
have a material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower
and its Subsidiaries taken as a whole.
5.02 Corporate and Other Power and Authority. Each Credit Party has the
corporate power and authority to execute, deliver and perform the terms and
provisions of each of the Documents to which it is party and has taken all
necessary corporate action to authorize the execution, delivery and performance
by it of each of such Documents. Each Credit Party has duly executed and
delivered each of the Documents to which it is party, and each of such
Documents constitutes its legal, valid and binding obligation enforceable in
accordance with its terms, except to the extent that the enforceability thereof
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws generally affecting creditors' rights and by equitable
principles (regardless of whether enforcement is sought in equity or at law).
5.03 No Violation. Neither the execution, delivery or performance by any
Credit Party of the Documents to which it is a party, nor compliance by it with
the terms and provisions thereof, (i) will contravene any provision of any law,
statute, rule or regulation or any order, writ, injunction or decree of any
court or governmental instrumentality, (ii) will conflict with or result in any
breach of any of the terms, covenants, conditions or provisions of, or
constitute a default under, or result in the creation or imposition of (or the
obligation to create or impose) any Lien (except pursuant to the Security
Documents) upon any of the property or assets of the Borrower or any of its
Subsidiaries pursuant to the terms of any indenture, mortgage, deed of trust,
credit agreement or loan agreement, or any other material agreement, contract
or instrument, to which the Borrower or any of its Subsidiaries is a party or
by which it or any of its property or assets is bound or to which it may be
subject or (iii) will violate any provision of the certificate of incorporation
or by-laws (or equivalent organizational documents) of the Borrower or any of
its Subsidiaries.
5.04 Approvals. No order, consent, approval, license, authorization or
validation of, or filing, recording or registration with (except for those that
have otherwise been obtained or made on or prior to the Effective Date and
which remain in full force and effect on the Effective Date), or exemption by,
any governmental or public body or authority, or any subdivision thereof, is
required to authorize, or is required in connection with, (i) the execution,
delivery and performance of any Document or (ii) the legality, validity,
binding effect or enforceability of any such Document.
5.05 Financial Statements; Financial Condition; Undisclosed Liabilities;
Projections; etc.
(a) The consolidated balance sheets of the Borrower for the fiscal
year and nine-month period ended on December 29, 1996 and
September 28, 1997 and the related consolidated statements of
income, cash flows and shareholders' equity of the Borrower
for the fiscal year or nine-month period, as the case may be,
ended on such dates, copies of which have been furnished to
the Agents prior to the Effective Date, present fairly in all
material respects the consolidated financial position of the
Borrower at the dates of such balance sheets and the
consolidated results of the
28
operations of the Borrower for the periods covered thereby.
All of the foregoing historical financial statements have been
prepared in accordance with generally accepted accounting
principles consistently applied. The pro forma consolidated
balance sheet of the Borrower as of September 28, 1997 after
giving effect to the Transaction and the financing therefor, a
copy of which has been furnished to the Lenders prior to the
Effective Date, presents fairly in all material respects the
pro forma consolidated financial position of the Borrower as
of September 28, 1997. After giving effect to the Transaction
(but for this purpose assuming that the Transaction and the
related financing had occurred prior to September 28, 1997),
since September 28, 1997, there has been no material adverse
change in the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
(b) On and as of the Effective Date and after giving effect to the
Transaction and to all Indebtedness (including the Loans)
being incurred or assumed and Liens created by the Credit
Parties in connection therewith (x) the sum of the assets, at
a fair valuation, of each of the Borrower on a stand-alone
basis and of the Borrower and its Subsidiaries taken as a
whole will exceed its debts; (y) each of the Borrower on a
stand-alone basis and the Borrower and its Subsidiaries taken
as a whole has not incurred and does not intend to incur, and
does not believe that it will incur, debts beyond its ability
to pay such debts as such debts mature; and (z) each of the
Borrower on a stand alone basis and the Borrower and its
Subsidiaries taken as a whole will have sufficient capital
with which to conduct its business. For purposes of this
Section 5.05(b), "debt" means any liability on a claim, and
"claim" means (i) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal,
equitable, secured, or unsecured or (ii) right to an equitable
remedy for breach of performance if such breach gives rise to
a payment, whether or not such right to an equitable remedy is
reduced to judgment, fixed, contingent, matured, unmatured,
disputed, undisputed, secured or unsecured. The amount of
contingent liabilities at any time shall be computed as the
amount that, in the light of all the facts and circumstances
existing at such time, represents the amount that can
reasonably be expected to become an actual or matured
liability.
(c) Except as fully disclosed in the financial statements
delivered pursuant to Section 5.05(a) or as set forth in
Schedules 5.09 and 5.19, there are no liabilities or
obligations with respect to the Borrower or any of its
Subsidiaries of any nature whatsoever (whether absolute,
accrued, contingent or otherwise and whether or not due)
which, either individually or in aggregate, could reasonably
be expected to be material to the Borrower and its
Subsidiaries taken as a whole. Except as set forth in
Schedules 5.09 and 5.19, the Borrower does not know of any
basis for the assertion against it or any of its Subsidiaries
of any liability or obligation of any nature whatsoever that
is not fully disclosed in the financial statements delivered
pursuant to Section 5.05(a) which, either individually or in
the aggregate, could reasonably be expected to be material to
the Borrower and its Subsidiaries taken as a whole.
(d) The Projections delivered to the Agents and the Lenders prior
to the Effective Date have been prepared in good faith and are
based on reasonable assumptions, and there are no statements
or conclusions in the Projections which are based upon or
include information known to the Borrower to be misleading in
any material respect or which fail to take into account
material information known to the Borrower regarding the
matters reported therein. The Borrower believes that the
Projections are reasonable and attainable, it being recognized
by the Lenders, however, that projections as to future events
are not to be viewed as facts and that the actual results
during the period or periods covered by the Projections may
differ from the projected results and that the differences may
be material.
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5.06 Litigation. There are no actions, suits or proceedings pending or, to
the best knowledge of the Borrower, threatened (i) with respect to the
Transaction or any Document, (ii) with respect to any material Indebtedness of
the Borrower or any of its Subsidiaries or (iii) that are reasonably likely to
materially and adversely affect the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower
and its Subsidiaries taken as a whole.
5.07 True and Complete Disclosure. All factual information (taken as a whole)
furnished by or on behalf of any Credit Party in writing to any Agent or any
Lender (including, without limitation, all information contained in the
Documents) for purposes of or in connection with this Agreement, the other
Credit Documents or any transaction contemplated herein or therein is, and all
other such factual information (taken as a whole) hereafter furnished by or on
behalf of any Credit Party in writing to any Agent or any Lender will be, true
and accurate in all material respects on the date as of which such information
is dated or certified and not incomplete by omitting to state any fact
necessary to make such information (taken as a whole) not misleading in any
material respect at such time in light of the circumstances under which such
information was provided.
5.08 Use of Proceeds; Margin Regulations.
(a) All proceeds of the Loans will be used by the Borrower (i) to
finance, in part, the Bank Refinancing, the Existing Senior
Secured Notes Tender Offer, the Existing Senior Secured Notes
Consent Solicitation, and the repayment of outstanding loans
under the Working Capital Facility (it being understood and
agreed that no more than $20,000,000 of such loans may be
outstanding on the Effective Date after giving effect to any
repayment thereof on such date), (ii) to pay fees and expenses
related to the Transaction and (iii) to the extent that any
such proceeds remain after the application pursuant to the
preceding clauses (i) and (ii), for the Borrower's and its
Subsidiaries' working capital and general corporate purposes.
(b) No part of any Loans (or the proceeds thereof) will be used to
purchase or carry any Margin Stock or to extend credit for the
purpose of purchasing or carrying any Margin Stock. Neither
the making of any Loan nor the use of the proceeds thereof
will violate or be inconsistent with the provisions of
Regulation G, T, U or X of the Board of Governors of the
Federal Reserve System.
5.09 Tax Returns and Payments. Each of the Borrower and each of its
Subsidiaries has filed all federal and state income tax returns and all other
material tax returns, domestic and foreign, required to be filed by it and has
paid all taxes and assessments payable by it which have become due, except for
those contested in good faith and adequately disclosed and fully provided for
on the financial statements of the Borrower and its Subsidiaries in accordance
with generally accepted accounting principles. The Borrower and each of its
Subsidiaries have at all times paid, or have provided adequate reserves (in the
good faith judgment of the management of the Borrower) for the payment of, all
federal, state, local and foreign income taxes applicable for all prior fiscal
years and for the current fiscal year to date. Except as disclosed in Schedule
5.09, there is no material action, suit, proceeding, investigation, audit, or
claim now pending or, to the knowledge of the Borrower threatened, by any
authority regarding any taxes relating to the Borrower or any of its
Subsidiaries. Except as disclosed in Schedule 5.09, neither the Borrower nor
any of its Subsidiaries has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute of
limitations relating to the payment or collection of taxes of the Borrower or
any of its Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of the Borrower or any of its
Subsidiaries not to be subject to the normally applicable statute of
limitations.
30
5.10 Compliance with ERISA. Schedule 5.10 sets forth, as of the Effective
Date, each Plan. Each Plan and the Borrower and each of its Subsidiaries and
ERISA Affiliates are in compliance in all material respects with the Code and
ERISA to the extent applicable to them and neither the Borrower nor any of its
Subsidiaries nor any ERISA Affiliate has received notification to the contrary
from the Internal Revenue Service, the Department of Labor or the PBGC.
Neither the Borrower nor any of its Subsidiaries nor any ERISA Affiliate has
(i) failed to satisfy the minimum funding requirements under Section 412 of the
Code or Section 302 of ERISA, (ii) failed to make a required contribution or
payment to a "multiemployer plan" (as defined in Section 4001 (a)(3) of ERISA),
or (iii) made a complete or partial withdrawal under Sections 4203 or 4205 of
ERISA from a multiemployer plan. No Reportable Event has occurred which could
reasonably be expected to result in a material liability to the Borrower or any
of its Subsidiaries. No Plan has an Unfunded Current Liability which could
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise)
or prospects of the Borrower and its Subsidiaries taken as a whole and using
actuarial assumptions and computation methods consistent with Part 1 of
subtitle E of Title IV or ERISA, neither the Borrower nor any of its
Subsidiaries or ERISA Affiliates would incur any liability to any Plans which
are multiemployer plans (as defined in Section 4001(a)(3) of ERISA) in the
event of a complete withdrawal therefrom, as of the close of the most recent
fiscal year of each such Plan ended prior to the Effective Date. Neither the
Borrower nor any of its Subsidiaries nor any ERISA Affiliate maintains or
contributes to any employee welfare benefit plan within the meaning of Section
3(1) of ERISA which provides benefits to employees after termination of
employment (other than as required under Section 601 of ERISA) which could
result in a material obligation of the Borrower or any of its Subsidiaries to
pay money, except such as were recorded as a result of the Borrower's adoption
of Financial Accounting Standard No. 106 ("Accounting for Postretirement
Benefits Other Than Pensions").
5.11 The Security Documents.
(a) The provisions of the Security Agreement are effective to
create in favor of the Collateral Agent for the benefit of the
Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of Acme Steel in the
Security Agreement Collateral described therein, and the
Collateral Agent, for the benefit of the Secured Creditors,
has a fully perfected first (after giving effect to the
provisions of the Collateral Agency Agreement) lien on, and
security interest in, all right, title and interest of Acme
Steel in all of the Security Agreement Collateral described
therein, subject to no other Liens other than Permitted Liens.
The recordation of the Assignment of Security Interest in U.S.
Patents and Trademarks in the form attached to the Security
Agreement in the United States Patent and Trademark Office,
together with filings on Form UCC-1 made pursuant to the
Security Agreement, will create, as may be perfected by such
filing and recordation, a perfected security interest in the
United States trademarks and patents covered by the Security
Agreement.
(b) The security interests created in favor of the Collateral
Agent, as pledgee, for the benefit of the Secured Creditors,
under the Pledge Agreement constitute first priority perfected
(after giving effect to the provisions of the Collateral
Agency Agreement) security interests in the Pledged Securities
described in the Pledge Agreement, subject to no security
interests of any other Person (other than the pari passu lien
of the holders of the Existing Senior Secured Notes). No
filings or recordings are required to perfect (or maintain the
perfection or priority of) the security interests created in
the Pledged Securities under the Pledge Agreement.
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(c) The Mortgages create, for the obligations purported to be
secured thereby, a valid and enforceable perfected first
priority (after giving effect to the provisions of the
Collateral Agency Agreement) security interest in and mortgage
lien on all of the Mortgaged Properties in favor of the
Collateral Agent (or such other trustee as may be required or
desired under local law) for the benefit of the Secured
Creditors, superior to and prior to the rights of all third
persons (except that the security interest and mortgage lien
created in the Mortgaged Properties may be subject to the
Permitted Encumbrances related thereto) and subject to no
other Liens (other than Permitted Liens). Schedule 5.11
contains a true and complete list of each parcel of Real
Property owned or leased by the Borrower and its Subsidiaries
on the Effective Date, and the type of interest therein held
by the Borrower or such Subsidiary. The Borrower and each of
its Subsidiaries have good and marketable title to all fee-
owned Real Property and valid leasehold title to all
Leaseholds, in each case free and clear of all Liens other
than Permitted Liens.
(d) Notwithstanding anything to the contrary contained in this
Section 5.11 or elsewhere in this Agreement, until such time
as all Existing Senior Secured Notes have been paid in full or
defeased in accordance with the terms thereof, the holders
thereof may have a pari passu Lien on the Collateral in
accordance with the terms of the Collateral Agency Agreement.
5.12 Representations and Warranties in the Documents. All representations and
warranties set forth in the other Documents were true and correct in all
material respects at the time as of which such representations and warranties
were made (or deemed made) and shall be true and correct in all material
respects on and as of the Effective Date as if such representations and
warranties were made on and as of such date, unless stated to relate to a
specific earlier date, in which case such representations and warranties shall
be true and correct in all material respects as of such earlier date.
5.13 Properties. The Borrower and each of its Subsidiaries have good and
marketable title to all material properties owned by them, including all
property reflected in the balance sheets referred to in Section 5.05(a) (except
as sold or otherwise disposed of since the date of such balance sheet in the
ordinary course of business or as permitted by the terms of this Agreement),
free and clear of all Liens, other than Permitted Liens.
5.14 Capitalization. The authorized capital stock of the Borrower consists of
(i) 20,000,000 shares of common stock, $1.00 par value per share and (ii)
2,000,000 shares of preferred stock, $1.00 par value per share, of which no
shares of such preferred stock are issued and outstanding. All outstanding
shares of common stock of the Borrower have been duly and validly issued and
are fully paid and non-assessable. The Borrower does not have outstanding any
securities convertible into or exchangeable for its capital stock or
outstanding any rights to subscribe for or to purchase, or any options for the
purchase of, or any agreement providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character relating
to, its capital stock except as set forth on Schedule 5.14.
5.15 Subsidiaries. The Borrower has no Subsidiaries other than those
Subsidiaries listed on Schedule 5.15. Schedule 5.15 correctly sets forth the
percentage ownership (direct or indirect) of the Borrower in each class of
capital stock or other equity of each of its Subsidiaries and also identifies
the direct owner thereof.
32
5.16 Compliance with Statutes, etc. Each of the Borrower and each of its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the
ownership of its property (excluding applicable statutes, regulations, orders
and restrictions relating to environmental standards and controls which is the
subject of the representations and warranties set forth in Section 5.19),
except such noncompliances as could not, individually or in the aggregate,
reasonably be expected to have a material adverse effect on the business,
operations, property, assets, liabilities, condition (financial or otherwise)
or prospects of the Borrower and its Subsidiaries taken as a whole.
5.17 Investment Company Act. Neither the Borrower nor any of its Subsidiaries
is an "investment company" or a company "controlled" by an "investment
company," within the meaning of the Investment Company Act of 1940, as amended.
5.18 Public Utility Holding Company Act. Neither the Borrower nor any of its
Subsidiaries is a "holding company," or a "subsidiary company" of a "holding
company," or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company" within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
5.19 Environmental Matters.
(a) Except as set forth on Schedule 5.19, the Borrower and each of
its Subsidiaries have complied with, and are in compliance
with, all applicable Environmental Laws and the requirements
of any permits issued under such Environmental Laws. There
are no pending or, to the best knowledge of the Borrower,
threatened Environmental Claims against the Borrower or any of
its Subsidiaries (including any such claim arising out of the
ownership, lease or operation by the Borrower or any of its
Subsidiaries of any Real Property no longer owned, leased or
operated by the Borrower or any of its Subsidiaries) or any
Real Property owned, leased or operated by the Borrower or any
of its Subsidiaries. Except as set forth on Schedule 5.19,
there are no facts, circumstances, conditions or occurrences
with respect to the business or operations of the Borrower or
any of its Subsidiaries, or any Real Property owned, leased or
operated by the Borrower or any of its Subsidiaries (including
any Real Property formerly owned, leased or operated by the
Borrower or any of its Subsidiaries but no longer owned,
leased or operated by the Borrower or any of its Subsidiaries)
that could be expected (i) to form the basis of an
Environmental Claim against the Borrower or any of its
Subsidiaries or any Real Property owned, leased or operated by
the Borrower or any of its Subsidiaries or (ii) to cause any
Real Property owned, leased or operated by the Borrower or any
of its Subsidiaries to be subject to any restrictions on the
ownership, occupancy or transferability of such Real Property
by the Borrower or any of its Subsidiaries under any
applicable Environmental Law.
(b) Hazardous Materials have not at any time been generated, used,
treated or stored on, or transported to or from, any Real
Property owned, leased or operated by the Borrower or any of
its Subsidiaries where such generation, use, treatment or
storage has violated or could reasonably be expected to
violate any Environmental Law. Hazardous Materials have not
at any time been Released on or from any Real Property owned,
leased or operated by the Borrower or any of its Subsidiaries
where such Release has violated or could reasonably be
expected to violate any applicable Environmental Law.
(c) Notwithstanding anything to the contrary in this Section 5.19,
the representations made in this Section 5.19 shall not be
untrue unless the effect of any or all violations, claims,
restrictions, failures and noncompliances of the types
described above in this
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Section 5.19 could reasonably be expected to, either
individually or in the aggregate, have a material adverse
effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
5.20 Labor Relations. Neither the Borrower nor any of its Subsidiaries is
engaged in any unfair labor practice that could reasonably be expected to have
a material adverse effect on the Borrower and its Subsidiaries taken as a
whole. There is (i) no unfair labor practice complaint pending against the
Borrower or any of its Subsidiaries or, to the best knowledge of the Borrower,
threatened against any of them, before the National Labor Relations Board, and
no grievance or arbitration proceeding arising out of or under any collective
bargaining agreement is so pending against the Borrower or any of its
Subsidiaries or, to the best knowledge of the Borrower, threatened against any
of them, (ii) no strike, labor dispute, slowdown or stoppage pending against
the Borrower or any of its Subsidiaries or, to the best knowledge of the
Borrower, threatened against the Borrower or any of its Subsidiaries and (iii)
no union representation question exists with respect to the employees of the
Borrower or any of its Subsidiaries, except (with respect to any matter
specified in clause (i), (ii) or (iii) above, either individually or in the
aggregate) such as could not reasonably be expected to have a material adverse
effect on the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower and its Subsidiaries
taken as a whole.
5.21 Patents, Licenses, Franchises and Formulas. Each of the Borrower and
each of its Subsidiaries owns or has the right to use all the patents,
trademarks, permits, service marks, trade names, copyrights, licenses,
franchises, proprietary information (including but not limited to rights in
computer programs and databases) and formulas, or rights with respect to the
foregoing, and has obtained assignments of all leases and other rights of
whatever nature, necessary for the present conduct of its business, without any
known conflict with the rights of others which, or the failure to obtain which,
as the case may be, could reasonably be expected to result in a material
adverse effect on the business, operations, property, assets, liabilities,
condition (financial or otherwise) or prospects of the Borrower and its
Subsidiaries taken as a whole.
5.22 Indebtedness. Schedule 5.22 sets forth a true and complete list of all
Indebtedness (including Contingent Obligations) of the Borrower and its
Subsidiaries as of the Effective Date and which is to remain outstanding after
giving effect to the Transaction (excluding the Loans, any Existing Senior
Secured Notes that have not been tendered pursuant to the Existing Senior
Secured Note Tender Offers, the Working Capital Facility and the New Senior
Notes, the "Existing Indebtedness"), in each case showing the aggregate
principal amount thereof and the name of the respective borrower and any Credit
Party or any of its Subsidiaries which directly or indirectly guarantees such
debt.
5.23 Existing Senior Secured Notes. At the time of consummation thereof, the
Existing Senior Secured Notes Tender Offer and the Existing Senior Secured
Notes Consent Solicitation shall have been consummated in accordance with the
terms of the respective Documents therefor (subject to any waivers permitted
under Section 4.08) and all applicable laws. At the time of consummation
thereof, all consents and approvals of, and filings and registrations with, and
all other actions in respect of, all governmental agencies, authorities or
instrumentalities required in order to make or consummate the Existing Senior
Secured Notes Tender Offer and the Existing Secured Senior Notes Consent
Solicitation shall have been obtained, given, filed or taken or waived and are
or will be in full force and effect (or effective judicial relief with respect
thereto has been obtained). All applicable waiting periods with respect
thereto have or, prior to the time when required, will have, expired without,
in all such cases, any action being taken by any competent authority which
34
restrains, prevents, or imposes material adverse conditions upon the Existing
Secured Senior Notes Tender Offer or the Existing Senior Secured Notes Consent
Solicitation. Additionally, there shall not exist any judgment, order or
injunction prohibiting or imposing material adverse conditions upon the
Existing Secured Senior Notes Tender Offer or the Existing Senior Secured Notes
Consent Solicitation, or the performance by the Borrower and its Subsidiaries
of their obligations under the respective Documents therefore and all
applicable laws.
5.24 Issuance of the New Senior Notes. At the time of the issuance thereof,
the New Senior Notes shall have been issued in accordance with the terms of the
New Senior Note Documents and all applicable laws. At the time of the issuance
thereof, all consents, approvals of and permits for, and filings and
registrations with, and all other actions in respect of, all governmental
agencies, authorities or instrumentalities required in order to issue the New
Senior Notes have been (or will, within the time frame required, be) obtained,
given, filed or taken and are or will be in full force and effect (or effective
judicial relief with respect thereto has been obtained). Additionally, there
does not exist any judgment, order or injunction prohibiting or imposing
material adverse conditions upon the issuance of the New Senior Notes or the
performance by the Borrower or any of its Subsidiaries of their obligations
under the New Senior Note Documents. All actions taken by the Borrower or any
of its Subsidiaries pursuant to or in furtherance of the issuance of New Senior
Notes have been taken in compliance with the New Senior Note Documents and all
applicable laws.
5.25 Insurance. Schedule 5.25 sets forth a true and complete listing of all
insurance maintained by the Borrower and its Subsidiaries, and with the amounts
insured (and any deductibles) set forth therein.
SECTION 6. Affirmative Covenants. The Borrower hereby covenants and agrees
that on and after the Effective Date and until the Loans and Notes, together
with interest, Fees and all other Obligations incurred hereunder and
thereunder, are paid in full:
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6.01 Information Covenants. The Borrower will furnish to the Agents (and the
Administrative Agent will promptly forward same to each Lender):
(a) Quarterly Financial Statements. As soon as same are available
but, in any event, no later than 60 days after the close of
each of the first three quarterly accounting periods in each
fiscal year of the Borrower (commencing with its quarterly
accounting period ending closest to March 31, 1998), the
consolidated and consolidating balance sheets of the Borrower
and its Subsidiaries as at the end of such quarterly
accounting period and the related consolidated and
consolidating statements of income and retained earnings and
statement of cash flows for such quarterly accounting period
and for the elapsed portion of the fiscal year ended with the
last day of such quarterly accounting period, in each case
setting forth comparative figures for the related periods in
the prior fiscal year, all of which shall be certified by the
Chief Financial Officer of the Borrower as being prepared, to
the best of such officer's knowledge, in accordance with GAAP,
subject to normal year-end audit adjustments and the absence
of footnotes.
(b) Annual Financial Statements. As soon as same are available
but, in any event, no later than 120 days after the close of
each fiscal year of the Borrower (commencing with its fiscal
year ending closest to December 31, 1997), (i) the
consolidated and consolidating balance sheets of the Borrower
and its Subsidiaries as at the end of such fiscal year and the
related consolidated and consolidating statements of income
and retained earnings and statement of cash flows for such
fiscal year setting forth comparative figures for the
preceding fiscal year and (x) in the case of the consolidated
financial statements, certified by Price Waterhouse LLP or
such other independent certified public accountants of
recognized national standing reasonably acceptable to the
Agents, together with a report of such accounting firm stating
that in the course of its regular audit of the financial
statements of the Borrower and its Subsidiaries, which audit
was conducted in accordance with generally accepted auditing
standards, such accounting firm obtained no knowledge of any
Default or an Event of Default relating to accounting matters
which has occurred and is continuing or, if in the opinion of
such accounting firm such a Default or Event of Default has
occurred and is continuing, a statement as to the nature
thereof and (y) in the case of the consolidating financial
statements, certified by the Chief Financial Officer of the
Borrower, and (ii) management's discussion and analysis of the
material operational and financial developments during such
fiscal year.
(c) Operating Plans. No later than 60 days following the first
day of each fiscal year of the Borrower (commencing with the
fiscal year of the Borrower beginning closest to January 1,
1999), an operating plan in form reasonably satisfactory to
the Agents (including statements of income and sources and
uses of cash and balance sheets) prepared by the Borrower (i)
for each of the four fiscal quarters of such fiscal year
prepared in detail and (ii) for each of the immediately three
succeeding fiscal years prepared in summary form, in each case
setting forth, with appropriate discussion, the principal
assumptions upon which such operating plan is based.
36
(d) Officer's Certificates. At the time of the delivery of the
financial statements provided for in Sections 6.01(a) and (b),
a certificate of the Chief Financial Officer of the Borrower
to the effect that, to the best of such officer's knowledge,
no Default or Event of Default has occurred and is continuing
or, if any Default or Event of Default has occurred and is
continuing, specifying the nature and extent thereof, which
certificate shall (x) set forth in reasonable detail the
calculations required to establish (A) whether the Borrower
and its Subsidiaries were in compliance with the provisions of
Sections 3.02(d), 3.02(f), 7.04 and 7.07 through 7.12,
inclusive, at the end of such fiscal quarter or year, as the
case may be, and (B) the Applicable Base Rate Margin and the
Applicable Eurodollar Rate Margin for the Applicable Margin
Period commencing with the date of the delivery of such
financial statements and (y) if delivered with the financial
statements required by Section 6.01(b), set forth in
reasonable detail the amount of (and the calculations required
to establish the amount of) Excess Cash Flow of the Borrower
for the respective Excess Cash Payment Period.
(e) Notice of Default or Litigation. Promptly upon, and in any
event within five Business Days after, any executive,
principal or senior officer of the Borrower obtains knowledge
thereof, notice of (i) the occurrence of any event which
constitutes a Default or an Event of Default and (ii) any
litigation or governmental investigation or proceeding pending
(x) against the Borrower or any of its Subsidiaries which
could reasonably be expected to materially and adversely
affect the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole, (y)
with respect to any material Indebtedness of the Borrower or
any of its Subsidiaries or (z) with respect to the Transaction
or any Document.
(f) Other Reports and Filings. Promptly after the filing or
delivery thereof, copies of all financial information, proxy
materials and reports, if any, which the Borrower or any of
its Subsidiaries shall publicly file with the Securities and
Exchange Commission or any successor thereto (the "SEC") or
deliver to holders of its material Indebtedness (including, in
any event, the Working Capital Facility and the New Senior
Notes) pursuant to the terms of the documentation governing
such Indebtedness (or any trustee, agent or other
representative therefor).
(g) Environmental Matters. Promptly after any executive,
principal or senior officer of the Borrower obtains knowledge
thereof, notice of one or more of the following environmental
matters, unless such environmental matters could not,
individually or when aggregated with all other such
environmental matters, be reasonably expected to materially
and adversely affect the business, operations, property,
assets, liabilities, condition (financial or otherwise) or
prospects of the Borrower and its Subsidiaries taken as a
whole:
(i) any pending or threatened Environmental Claim against
the Borrower or any of its Subsidiaries or any Real
Property owned, leased or operated by the Borrower or
any of its Subsidiaries;
(ii) any condition or occurrence on or arising from any
Real Property owned, leased or operated by the
Borrower or any of its Subsidiaries that (a) results
in noncompliance by the Borrower or any of its
Subsidiaries with any applicable Environmental Law or
(b) could be expected to form the basis of an
Environmental Claim against the Borrower or any of
its Subsidiaries or any such Real Property;
(iii) any condition or occurrence on any Real Property
owned, leased or operated by the Borrower or any of
its Subsidiaries that could be expected to cause such
Real Property to be subject to any restrictions on
the ownership, occupancy, use or transferability by
the Borrower or any of its Subsidiaries of such Real
Property under any Environmental Law; and
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(iv) the taking of any removal or remedial action in
response to the actual or alleged presence of any
Hazardous Material on any Real Property owned, leased
or operated by the Borrower or any of its
Subsidiaries as required by any Environmental Law or
any governmental or other administrative agency;
provided, that in any event the Borrower shall
deliver to each Agent all material notices received
by the Borrower or any of its Subsidiaries from any
government or governmental agency under, or pursuant
to, CERCLA which identify the Borrower or any of its
Subsidiaries as potentially responsible parties for
remediation costs or which otherwise notify the
Borrower or any of its Subsidiaries of potential
liability under CERCLA.
All such notices shall describe in reasonable detail the nature of the claim,
investigation, condition, occurrence or removal or remedial action and the
Borrower's or such Subsidiary's response thereto.
(h) Other Information. From time to time, such other information or documents
(financial or otherwise) with respect to the Borrower or any of its
Subsidiaries as any Agent or any Lender (through any Agent) may reasonably
request.
6.02 Books, Records, Inspections and Annual Meetings.
(a) The Borrower will, and will cause each of its Subsidiaries to,
keep proper books of record and accounts in which full, true
and correct entries in conformity with generally accepted
accounting principles and all requirements of law shall be
made of all dealings and transactions in relation to its
business and activities. The Borrower will, and will cause
each of its Subsidiaries to, permit officers and designated
representatives of any Agent to visit and inspect, under
guidance of officers of the Borrower or such Subsidiary, any
of the properties of the Borrower or such Subsidiary, and to
examine the books of account of the Borrower or such
Subsidiary and discuss the affairs, finances and accounts of
the Borrower or such Subsidiary with, and be advised as to the
same by, its and their officers and independent accountants,
all upon reasonable prior notice and at such reasonable times
and intervals and to such reasonable extent as such Agent may
reasonably request.
(b) At such dates to be mutually agreed upon between the Agents
and the Borrower but, in no event, less than once in each
fiscal year of the Borrower, the Borrower shall, at the
request of the Agents, hold a meeting with all of the Lenders
at which meeting shall be reviewed the financial results of
the Borrower and its Subsidiaries for the previous fiscal year
and the operating plan presented for the current fiscal year
of the Borrower.
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6.03 Maintenance of Property; Insurance.
(a) The Borrower will, and will cause each of its Subsidiaries to,
(i) keep all property necessary to the business of the
Borrower and its Subsidiaries in good working order and
condition, ordinary wear and tear excepted, (ii) maintain
insurance on all such property in at least such amounts and
against at least such risks as is consistent and in accordance
with industry practice for companies similarly situated owning
similar properties in the same general areas in which the
Borrower or any of its Subsidiaries operates, and (iii)
furnish to the Agents, upon written request, full information
as to the insurance carried. At any time that insurance at or
above the levels described on Schedule 5.25 is not being
maintained by the Borrower or any Subsidiary of the Borrower,
the Borrower will, or will cause one of its Subsidiaries to,
promptly notify the Agents in writing and, if thereafter
reasonably requested by any Agent or the Required Lenders to
do so, the Borrower or any such Subsidiary, as the case may
be, shall obtain such insurance at such levels and coverage
which are at least as great as to the extent such insurance is
reasonably available at a reasonable expense.
(b) The Borrower will, and will cause each of its Subsidiaries to,
at all times keep the Collateral insured in favor of the
Collateral Agent, and all policies (including Mortgage
Policies) or certificates (or certified copies thereof) with
respect to such insurance (and any other insurance maintained
by the Borrower and/or such Subsidiaries) (i) shall be
endorsed to the Administrative Agent's satisfaction for the
benefit of the Collateral Agent (including, without
limitation, by naming the Collateral Agent as loss payee (in
respect of any Collateral only) and/or additional insured, as
appropriate), (ii) shall state that such insurance policies
shall not be canceled without at least 30 days' prior written
notice thereof by the respective insurer to the Collateral
Agent (or such shorter period of time as a particular
insurance company policy generally provides), (iii) shall
provide that the respective insurers irrevocably waive any and
all rights of subrogation with respect to the Collateral Agent
and the Secured Creditors, (iv) shall contain the standard
non-contributing mortgage clause endorsement in favor of the
Collateral Agent with respect to hazard liability insurance
and (v) shall be deposited with the Collateral Agent.
(c) If the Borrower or any of its Subsidiaries shall fail to
insure its property in accordance with this Section 6.03, or
if the Borrower or any of its Subsidiaries shall fail to so
endorse and deposit all policies or certificates with respect
thereto, the Collateral Agent shall have the right (but shall
be under no obligation) to procure such insurance and the
Borrower agrees to reimburse the Collateral Agent for all
reasonable costs and expenses of procuring such insurance.
6.04 Corporate Franchises. The Borrower will, and will cause each of its
Subsidiaries to, do or cause to be done, all things necessary to preserve and
keep in full force and effect its existence and its material rights,
franchises, licenses and patents; provided, however, that nothing in this
Section 6.04 shall prevent (i) sales of assets and other transactions by the
Borrower or any of its Subsidiaries in accordance with Section 7.02 or (ii) the
withdrawal by the Borrower or any of its Subsidiaries of its qualification as a
foreign corporation in any jurisdiction where such withdrawal, either
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on the business, operations, property, assets,
liabilities, condition (financial or otherwise) or prospects of the Borrower
and its Subsidiaries taken as a whole.
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6.05 Compliance with Statutes, etc. The Borrower will, and will cause each of
its Subsidiaries to, comply with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the
ownership of its property (including applicable statutes, regulations, orders
and restrictions relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business, operations,
property, assets, liabilities, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole.
6.06 Compliance with Environmental Laws.
(a) The Borrower will comply, and will cause each of its
Subsidiaries to comply, in all material respects with all
Environmental Laws applicable to the ownership or use of its
Real Property now or hereafter owned, leased or operated by
the Borrower or any of its Subsidiaries, will promptly pay or
cause to be paid all costs and expenses incurred in connection
with such compliance, and will keep or cause to be kept all
such Real Property free and clear of any Liens imposed
pursuant to such Environmental Laws. Neither the Borrower nor
any of its Subsidiaries will generate, use, treat, store,
Release or dispose of, or permit the generation, use,
treatment, storage, Release or disposal of Hazardous Materials
on any Real Property now or hereafter owned, leased or
operated by the Borrower or any of its Subsidiaries, or
transport or permit the transportation of Hazardous Materials
to or from any such Real Property, except for Hazardous
Materials generated, used, treated, stored, Released or
disposed of at any such Real Properties in compliance in all
material respects with all applicable Environmental Laws and
reasonably required in connection with the operation, use and
maintenance of the business or operations of the Borrower or
any of its Subsidiaries.
(b) (i) At any time that the Borrower gives notice to the
Lenders or the Agents pursuant to Section 6.01(g) or
(ii) upon the exercise of any of the remedies
pursuant to the last paragraph of Section 8, then at
the reasonable written request of any Agent or the
Required Lenders, the Borrower will provide, at the
sole expense of the Borrower, an environmental site
assessment report concerning any Real Property owned,
leased or operated by the Borrower or any of its
Subsidiaries, prepared by an environmental consulting
firm reasonably approved by the Agents, indicating
the presence or absence of Hazardous Materials and
the potential cost of any removal or remedial action
in connection with such Hazardous Materials on such
Real Property. If the Borrower fails to provide the
same within 90 days after such request was made, the
Administrative Agent may order the same, the cost of
which shall be borne by the Borrower, and the
Borrower shall grant and hereby grants to the
Administrative Agent and the Lenders and their agents
access to such Real Property and specifically grants
the Administrative Agent and the Lenders an
irrevocable non-exclusive license, subject to the
rights of tenants, to undertake such an assessment at
any reasonable time upon reasonable notice to the
Borrower, all at the sole and reasonable expense of
the Borrower.
40
6.07 ERISA. The Borrower will, and will cause each of its Subsidiaries and
ERISA Affiliates to, promptly pay and discharge all obligations and liabilities
arising under ERISA of a character which if unpaid or unperformed could
reasonably be expected to result in the imposition of a Lien against any of
their respective properties or assets or a material obligation to pay money
(including, but not limited to, any liability to a multiemployer plan as
defined in Section 4001(a)(3) of ERISA), and will promptly notify the Agents
when the Borrower, a Subsidiary of the Borrower or an ERISA Affiliate (i) knows
or has reason to know of the occurrence of a Reportable Event, (ii) that a
contributing sponsor (as defined in Section 4001(a)(13) of ERISA) of a Plan
subject to Title IV of ERISA is subject to the advance reporting requirement of
PBGC Regulation Section 4043.61 (without regard to subparagraph (b)(1)
thereof), and an event described in subsection .66 of PBGC Regulation Section
4043 is reasonably expected to occur with respect to such Plan within the
following 30 days, (iii) that a Plan has been terminated, reorganized,
partitioned or declared insolvent under Title IV of ERISA or (iv) that
proceedings have been instituted to terminate or appoint a trustee to
administer a Plan which is subject to Title IV or ERISA.
6.08 End of Fiscal Years; Fiscal Quarters. The Borrower will cause (i) each
of its, and each of its Subsidiaries', fiscal years to end on the last Sunday
in December, and (ii) each of its, and each of its Subsidiaries', fiscal
quarters to end on dates which are consistent with a fiscal year end as
described in preceding clause (i).
6.09 Performance of Obligations. The Borrower will, and will cause each of
its Subsidiaries to, perform all of its obligations under the terms of each
mortgage, indenture, security agreement, loan agreement or credit agreement and
each other material agreement, contract, lease or instrument by which it is
bound, except such non-performances as could not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower and its Subsidiaries taken as a whole.
6.10 Payment of Taxes. The Borrower will pay and discharge, and will cause
each of its Subsidiaries to pay and discharge, all taxes, assessments and
governmental charges or levies imposed upon it or upon its income or profits,
or upon any properties belonging to it, prior to the date on which penalties
attach thereto, and all lawful claims for sums that have become due and payable
which, if unpaid, might become a Lien not otherwise permitted under Section
7.01(i); provided, that neither the Borrower nor any of its Subsidiaries shall
be required to pay any such tax, assessment, charge, levy or claim which is
being contested in good faith and by proper proceedings if it has maintained
adequate reserves with respect thereto in accordance with generally accepted
accounting principles.
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6.11 Additional Security; Further Assurances.
(a) (i) In the event that the Borrower at any time acquires
assets after the Effective Date (other than (x) the
capital stock of any Subsidiary of the Borrower and
(y) assets subject to a Lien permitted under Sections
7.01(vii) and (viii)) with a fair market value of
$2,500,000 or more, the Borrower will, and (ii) the
Borrower will cause Acme Steel and each of the other
Granting Credit Parties to, in each case, grant to
the Collateral Agent security interests and mortgages
in such assets and properties of the Borrower, Acme
Steel and such other Granting Credit Parties, as
applicable, as are not covered by the original
Security Documents but are otherwise of a type
covered by the original Security Documents, and as
may be reasonably requested from time to time by any
Agent (collectively, the "Additional Security
Documents"). All such security interests and
mortgages shall be granted pursuant to documentation
reasonably satisfactory in form and substance to the
Agents and shall constitute valid and enforceable
perfected security interests and mortgages superior
to and prior to the rights of all third Persons and
subject to no other Liens except for Permitted Liens.
The Additional Security Documents or instruments
related thereto shall have been duly recorded or
filed in such manner and in such places as are
required by law to establish, perfect, preserve and
protect the Liens in favor of the Collateral Agent
required to be granted pursuant to the Additional
Security Documents and all taxes, fees and other
charges payable in connection therewith shall have
been paid in full.
(b) The Borrower will, and will cause each of the other Credit
Parties to, at the expense of the Borrower, make, execute,
endorse, acknowledge, file and/or deliver to the Collateral
Agent from time to time such vouchers, invoices, schedules,
confirmatory assignments, conveyances, financing statements,
transfer endorsements, powers of attorney, certificates, real
property surveys, reports and other assurances or instruments
and take such further steps relating to the Collateral covered
by any of the Security Documents as the Collateral Agent may
reasonably require. Furthermore, the Borrower will cause to be
delivered to the Collateral Agent such opinions of counsel,
title insurance and other related documents as may be
reasonably requested by the Collateral Agent to assure itself
that this Section 6.11 has been complied with.
(c) If any Agent or the Required Lenders reasonably determine that
they are required by law or regulation to have appraisals
prepared in respect of the Mortgaged Properties, the Borrower
will provide, at its own expense, to the Agents appraisals
which satisfy the applicable requirements of the Real Estate
Appraisal Reform Amendments of the Financial Institution
Reform, Recovery and Enforcement Act of 1989, as amended, and
which otherwise shall be in form and substance reasonably
satisfactory to the Agents.
(d) The Borrower agrees that each action required above by this
Section 6.11 shall be completed as soon as possible, but in no
event later than 90 days after such action is either requested
to be taken by any Agent or the Required Lenders or required
to be taken by the Borrower and/or its Subsidiaries pursuant
to the terms of this Section 6.11; provided that, in no event
will the Borrower or any of its Subsidiaries be required to
take any action, other than using its best efforts, to obtain
consents from third parties with respect to its compliance
with this Section 6.11.
42
SECTION 7. Negative Covenants. The Borrower hereby covenants and agrees that
on and after the Effective Date and until the Loans and Notes, together with
interest, Fees and all other Obligations incurred hereunder and thereunder, are
paid in full:
7.01 Liens. The Borrower will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
the Borrower or any of its Subsidiaries, whether now owned or hereafter
acquired, or sell any such property or assets subject to an understanding or
agreement, contingent or otherwise, to repurchase such property or assets
(including sales of accounts receivable with recourse to the Borrower or any of
its Subsidiaries), or assign any right to receive income or permit the filing
of any financing statement under the UCC or any other similar notice of Lien
under any similar recording or notice statute; provided that the provisions of
this Section 7.01 shall not prevent the creation, incurrence, assumption or
existence of the following (Liens described below are herein referred to as
"Permitted Liens"):
(i) inchoate Liens for taxes, assessments or governmental
charges or levies not yet due or Liens for taxes,
assessments or governmental charges or levies being
contested in good faith and by appropriate
proceedings for which adequate reserves have been
established in accordance with generally accepted
accounting principles;
(ii) Liens in respect of property or assets of the
Borrower or any of its Subsidiaries imposed by law,
which were incurred in the ordinary course of
business and do not secure Indebtedness for borrowed
money, such as carriers', warehousemen's,
materialmen's and mechanics' liens and other similar
Liens arising in the ordinary course of business, and
(x) which do not in the aggregate materially detract
from the value of the Borrower's or such Subsidiary's
property or assets or materially impair the use
thereof in the operation of the business of the
Borrower or such Subsidiary or (y) which are being
contested in good faith by appropriate proceedings,
which proceedings have the effect of preventing the
forfeiture or sale of the property or assets subject
to any such Lien;
(iii) Liens in existence on the Effective Date (but not
securing the Existing Senior Secured Notes or the
Working Capital Facility) which are listed, and the
property subject thereto described, in Schedule 7.01,
but only to the respective date, if any, set forth in
such Schedule 7.01 for the removal, replacement and
termination of any such Liens, plus renewals,
replacements and extensions of such Liens to the
extent set forth on Schedule 7.01, provided that (x)
the aggregate principal amount of the Indebtedness,
if any, secured by such Liens does not increase from
that amount outstanding at the time of any such
renewal, replacement or extension plus the reasonable
costs associated with any such renewal, replacement
or extension and (y) any such renewal, replacement or
extension does not encumber any additional assets or
properties of the Borrower or any of its
Subsidiaries;
(iv) Permitted Encumbrances;
(v) Liens created pursuant to the Security Documents;
(vi) leases or subleases granted to other Persons not
materially interfering with the conduct of the
business of the Borrower or any of its Subsidiaries;
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(vii) Liens upon assets of the Borrower or any of its
Subsidiaries acquired after the Effective Date and
subject to Capitalized Lease Obligations to the
extent such Capitalized Lease Obligations are
permitted by Section 7.04(iv), provided that (x) such
Liens only serve to secure the payment of
Indebtedness arising under such Capitalized Lease
Obligation and (y) the Lien encumbering the asset
giving rise to the Capitalized Lease Obligation does
not encumber any other asset of the Borrower or any
Subsidiary of the Borrower;
(viii) Liens placed upon equipment or machinery acquired or
constructed after the Effective Date and used in the
ordinary course of business of the Borrower or any of
its Subsidiaries at the time of the acquisition or
construction thereof by the Borrower or any such
Subsidiary or within 90 days thereafter to secure
Indebtedness incurred to pay all or a portion of the
purchase or construction price thereof or to secure
Indebtedness incurred solely for the purpose of
financing the acquisition or construction of any such
equipment or machinery or extensions, renewals or
replacements of any of the foregoing for the same or
a lesser amount, provided that (x) the aggregate
outstanding principal amount of all Indebtedness
secured by Liens permitted by this clause (viii),
when added to the aggregate outstanding principal
amount of all Indebtedness secured by Liens permitted
by clause (vii) of this Section 7.01, shall not at
any time exceed $35,000,000 and (y) in all events,
the Lien encumbering the equipment or machinery so
acquired or constructed does not encumber any other
asset of the Borrower or such Subsidiary (including
any Collateral);
(ix) easements, rights-of-way, restrictions, encroachments
and other similar charges or encumbrances, and minor
title deficiencies, in each case not securing
Indebtedness and not materially interfering with the
conduct of the business of the Borrower or any of its
Subsidiaries;
(x) Liens arising from precautionary UCC financing
statement filings regarding operating leases
permitted under Section 7.07;
(xi) Liens arising out of the existence of judgments or
awards in respect of which the Borrower or any of its
Subsidiaries shall in good faith be prosecuting an
appeal or proceedings for review in respect of which
there shall have been secured a subsisting stay of
execution pending such appeal or proceedings,
provided that the aggregate amount of any cash and
the fair market value of any property subject to such
Liens do not exceed $2,500,000 at any time
outstanding;
(xii) statutory and common law landlords' liens under
leases to which the Borrower or any of its
Subsidiaries is a party;
(xiii) (x) Liens (other than Liens imposed under ERISA)
incurred in the ordinary course of business in
connection with workers compensation claims,
unemployment insurance and social security benefits
and (y) Liens securing the performance of bids,
tenders, leases and contracts in the ordinary course
of business, statutory obligations, surety bonds,
performance bonds and other obligations of a like
nature incurred in the ordinary course of business
(exclusive of obligations in respect of the payment
for borrowed money);
(xiv) Liens on property or assets (other than Collateral)
of the Borrower or any of its Subsidiaries acquired
after the Effective Date in favor of governmental
bodies to secure progress or advance payments
relating to such property or assets;
44
(xv) Liens on property or assets acquired after the
Effective Date pursuant to a Permitted Acquisition,
or on property or assets of a Subsidiary of the
Borrower in existence at the time such Subsidiary is
acquired after the Effective Date pursuant to a
Permitted Acquisition, provided that (x) any
Indebtedness that is secured by such Liens is
permitted to exist under Section 7.04(x), and (y)
such Liens are not incurred in connection with, or in
contemplation or anticipation of, such Permitted
Acquisition and do not attach to any other asset of
the Borrower or any of its Subsidiaries (including
any Collateral);
(xvi) Liens on accounts receivable and inventory of the
Borrower and the Subsidiary Guarantors securing
Indebtedness under the Working Capital Facility;
(xvii) so long as any Existing Senior Secured Notes remain
outstanding or until such time as the Existing Senior
Secured Notes have been defeased in accordance with
the terms thereof, Liens on the Collateral securing
the Existing Senior Secured Notes so long as such
Liens are pari passu with the Liens created in favor
of the Secured Creditors pursuant to the Security
Documents; and
(xviii) at any time after the defeasance of the Existing
Senior Secured Notes has been effected in accordance
with the terms thereof, Liens created on Cash
Equivalents or other Investments made as described in
Section 7.05(xiv) which have been deposited in order
to effect such defeasance.
In connection with the granting of Liens of the type described in clauses (vii)
and (viii) of this Section 7.01 by the Borrower or any of its Subsidiaries, the
Administrative Agent and the Collateral Agent shall be authorized to take any
actions deemed appropriate by it in connection therewith (including, without
limitation, by executing appropriate lien releases or lien subordination
agreements in favor of the holder or holders of such Liens, in either case
solely with respect to the item or items of equipment or other assets subject
to such Liens), and in connection with the granting of the leases to NACME
described in clause (ix) of Section 7.02, the Administrative Agent and the
Collateral Agent shall be authorized to enter into customary non-disturbance
and attornment agreements reasonably acceptable to them.
7.02 Consolidation, Merger, Purchase or Sale of Assets, etc. The Borrower
will not, and will not permit any of its Subsidiaries to, wind up, liquidate or
dissolve its affairs or enter into any transaction of merger or consolidation,
or convey, sell, lease or otherwise dispose of all or any part of its property
or assets, or enter into any sale-leaseback transactions, or purchase or
otherwise acquire (in one or a series of related transactions) any part of the
property or assets (other than purchases or other acquisitions of inventory,
materials and equipment in the ordinary course of business) of any Person (or
agree to do any of the foregoing at any future time), except that:
(i) Capital Expenditures by the Borrower and its
Subsidiaries shall be permitted to the extent not in
violation of Section 7.08;
(ii) each of the Borrower and its Subsidiaries may make
sales of inventory in the ordinary course of
business;
(iii) each of the Borrower and its Subsidiaries may sell
obsolete or worn-out equipment or materials in the
ordinary course of business;
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(iv) the Borrower and its Subsidiaries may sell all of the
capital stock of, or all or substantially all of the
assets of, Universal Tool & Stamping, so long as (x)
no Default or Event of Default then exists or would
result therefrom, (y) such sale is in an arm's-length
transaction and the Borrower or the respective
Subsidiary receives at least fair market value (as
determined in good faith by the Borrower or such
Subsidiary, as the case may be), and (z) at least 50%
of the total consideration therefor received by the
Borrower and its Subsidiaries is cash and is paid at
the time of the closing of such sale;
(v) each of the Borrower and its Subsidiaries may sell
assets (other than the capital stock of any
Subsidiary Guarantor or any Mortgaged Property (other
than any immaterial portion of any Mortgaged Property
which is no longer useful in the operations of the
Borrower and its Subsidiaries and the sale of which
is otherwise permitted by this clause (v))), so long
as (w) no Default or Event of Default then exists or
would result therefrom, (x) each such sale is in an
arm's-length transaction and the Borrower or the
respective Subsidiary receives at least fair market
value (as determined in good faith by the Borrower or
such Subsidiary, as the case may be), (y) the total
consideration therefor received by the Borrower or
such Subsidiary is at least 85% cash and is paid at
the time of the closing of such sale, and (z) the
aggregate amount of the proceeds received from all
assets sold pursuant to this clause (v) shall not
exceed $5,000,000 in any fiscal year of the Borrower;
(vi) Investments may be made to the extent permitted by
Section 7.05;
(vii) each of the Borrower and its Subsidiaries may lease
(as lessee) real or personal property (so long as any
such lease does not create a Capitalized Lease
Obligation except to the extent permitted by Section
7.04(iv));
(viii) each of the Borrower and its Subsidiaries may sell or
discount, in each case without recourse and in the
ordinary course of business, accounts receivable
arising in the ordinary course of business, but only
in connection with the compromise or collection
thereof;
(ix) each of the Borrower and its Subsidiaries may grant
leases or subleases to other Persons not materially
interfering with the conduct of the business of the
Borrower or any of its Subsidiaries, provided that
each such lease or sublease relating to any Mortgaged
Property (other than the existing lease to NACME or
any extension or renewal thereof or any future lease
to NACME of the vacant land adjacent to the property
subject to such existing lease) shall expressly
provide that same shall be subject and subordinate to
the security interests created under the respective
Mortgage;
(x) any Subsidiary of the Borrower (x) may be merged,
consolidated or liquidated with or into the Borrower
so long as the Borrower is the surviving corporation
of such merger, consolidation or liquidation and (y)
may transfer all or any portion of its assets to the
Borrower, in each case so long as the Borrower takes
all of the actions required to be taken by it
pursuant to Section 6.12;
46
(xi) any Subsidiary of the Borrower (x) may be merged,
consolidated or liquidated with or into any other
Subsidiary of the Borrower which is a Granting Credit
Party so long as such Granting Credit Party is the
surviving corporation of such merger, consolidation
or liquidation and (y) may transfer all or any
portion of its assets to any other Subsidiary of the
Borrower which is a Granting Credit Party, in each
case so long as such Granting Credit Party takes all
of the actions required to be taken by it pursuant to
Section 6.12;
(xii) any Subsidiary of the Borrower which is not a
Granting Credit Party (x) may be merged, consolidated
or liquidated with or into any Wholly-Owned
Subsidiary of the Borrower which is not a Granting
Credit Party and (y) may transfer all or any portion
of its assets to any Wholly-Owned Subsidiary of the
Borrower which is not a Granting Credit Party;
(xiii) each of the Borrower and the Subsidiary Guarantors
may acquire all or substantially all of the assets of
any Person (or all or substantially all of the assets
of a product line or division of any Person) or all
or any portion of the capital stock or other equity
interests of any Person (any such acquisition
permitted by this clause (xiii), a "Permitted
Acquisition"), so long as (i) no Default or Event of
Default then exists or would result therefrom, (ii)
each of the representations and warranties contained
in Section 5 shall be true and correct in all
material respects both before and after giving effect
to such Permitted Acquisition, (iii) any Liens or
Indebtedness assumed or issued in connection with
such acquisition are otherwise permitted under
Section 7.01 or 7.04, as the case may be, (iv) the
only consideration paid by the Borrower or any
Subsidiary Guarantor in connection with any Permitted
Acquisition consists solely of cash, common stock of
the Borrower and/or Qualified Preferred Stock of the
Borrower, (v) at least 5 Business Days prior to the
consummation of any Permitted Acquisition, the
Borrower shall have delivered to each of the Agents a
certificate of the Borrower's Chief Financial Officer
certifying (and showing the calculations therefor in
reasonable detail) that the Borrower and its
Subsidiaries would have been in compliance with the
financial covenants set forth in Sections 7.09, 7.10,
7.11 and 7.12 for the Test Period then most recently
ended prior to the date of the consummation of such
Permitted Acquisition, in each case with such
financial covenants to be determined on a pro forma
basis as if such Permitted Acquisition had been
consummated on the first day of such Test Period (and
assuming that any Indebtedness incurred, issued or
assumed in connection therewith had been incurred,
issued or assumed on the first day of, and had
remained outstanding throughout, such Test Period),
and (vi) the aggregate cash consideration paid in
connection with all such Permitted Acquisitions
(including, without limitation, any earn-out,
non-compete or deferred compensation arrangements,
the aggregate principal amount of any Indebtedness
assumed in connection therewith and the fair market
value of any capital stock of the Borrower issued in
connection therewith (as determined in good faith by
the Board of Directors of the Borrower)), when added
to the aggregate amount of Investments made pursuant
to Section 7.05(xv), does not exceed $15,000,000; and
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(xiv) the Borrower and its Subsidiaries may enter into
sale-leaseback transactions with respect to its
property or assets other than with respect to any
Collateral, so long as (i) no Default or Event of
Default then exists or would result therefrom, (ii)
each such sale-leaseback transaction is in an arm's
length transaction and the Borrower or the respective
Subsidiary receives at least fair market value (as
determined in good faith by the Borrower or such
Subsidiary, as the case may be) and (iii) the
aggregate amount of all such sale-leaseback
transactions permitted under this clause (xiv) shall
not exceed $15,000,000 in any fiscal year of the
Borrower.
To the extent the Required Lenders waive the provisions of this Section 7.02
with respect to the sale of any Collateral, or any Collateral is sold as
permitted by this Section 7.02 (other than to the Borrower or a Subsidiary
thereof), such Collateral shall be sold free and clear of the Liens created by
the Security Documents, and the Administrative Agent and the Collateral Agent
shall be authorized to take any actions deemed appropriate in order to effect
the foregoing.
7.03 Dividends. The Borrower will not, and will not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to the
Borrower or any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may pay cash Dividends
to the Borrower or any Wholly-Owned Subsidiary of the
Borrower;
(ii) any non-Wholly-Owned Subsidiary of the Borrower may
pay cash Dividends to its shareholders generally so
long as the Borrower or its respective Subsidiary
which owns the equity interest in the Subsidiary
paying such Dividends receives at least its
proportionate share thereof (based upon its relative
holding of the equity interest in the Subsidiary
paying such Dividends and taking into account the
relative preferences, if any, of the various classes
of equity interests of such Subsidiary); and
(iii) so long as no Default or Event of Default then exists
or would result therefrom, the Borrower may
repurchase outstanding shares of its common stock (or
options to purchase such common stock) following the
death, disability or termination of employment of
employees of the Borrower or any of its Subsidiaries,
provided that the aggregate amount of Dividends paid
by the Borrower pursuant to this clause (iii) shall
not exceed $500,000 in any fiscal year of the
Borrower.
7.04 Indebtedness. The Borrower will not, and will not permit any of its
Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and
the other Credit Documents;
(ii) Existing Indebtedness outstanding on the Effective
Date and listed on Schedule 5.22, without giving
effect to any subsequent extension, renewal or
refinancing thereof except to the extent set forth on
Schedule 5.22, provided that the aggregate principal
amount of the Indebtedness to be extended, renewed or
refinanced does not increase from that amount
outstanding at the time of any such extension,
renewal or refinancing plus the reasonable costs
associated with any such extension, renewal or
refinancing;
48
(iii) Indebtedness under Interest Rate Protection
Agreements entered into with respect to Indebtedness
permitted under this Section 7.04;
(iv) Indebtedness of the Borrower and its Subsidiaries
evidenced by Capitalized Lease Obligations to the
extent permitted pursuant to Section 7.08, provided
that in no event shall the aggregate principal amount
of Capitalized Lease Obligations permitted by this
clause (iv), when added to the aggregate outstanding
principal amount of all Indebtedness permitted by
clause (v) of this Section 7.04, exceed $35,000,000
at any time outstanding;
(v) Indebtedness subject to Liens permitted under
Sections 7.01(viii);
(vi) intercompany Indebtedness among the Borrower and its
Subsidiaries to the extent permitted by Section
7.05(ix);
(vii) Indebtedness of the Borrower and Acme Steel under the
New Senior Notes and the other New Senior Note
Documents in an aggregate principal amount not to
exceed $200,000,000 (as reduced by any repayments of
principal thereof);
(viii) Indebtedness of the Borrower and the Subsidiary
Guarantors under the Working Capital Facility in an
aggregate outstanding principal amount not to exceed
the lesser of (x) $80,000,000 at any time and (y) an
amount equal to the sum of 85% of the face value of
all "eligible receivables" of the Borrower and the
Subsidiary Guarantors party thereto plus 50% of the
lower of the fair market value or cost of their
"eligible inventory" (as such terms are defined for
purposes of the Working Capital Facility);
(ix) Indebtedness of the Borrower and the Subsidiary
Guarantors under the Existing Senior Secured Notes
and the other Existing Senior Secured Note Documents
in an aggregate principal amount not to exceed that
amount outstanding immediately after the consummation
of the Existing Senior Secured Notes Tender Offer (as
reduced by any repayments of principal thereof after
the Effective Date);
(x) Indebtedness of a Subsidiary acquired pursuant to a
Permitted Acquisition (or Indebtedness assumed at the
time of a Permitted Acquisition of an asset securing
such Indebtedness), provided that (x) such
Indebtedness was not incurred in connection with, or
in anticipation or contemplation of, such Permitted
Acquisition, (y) such Indebtedness does not
constitute debt for borrowed money (other than debt
for borrowed money incurred in connection with
industrial revenue or industrial development bond
financings), it being understood and agreed that
Capitalized Lease Obligations and purchase money
Indebtedness shall not constitute debt for borrowed
money for purposes of this clause (x), and (z) at the
time of such Permitted Acquisition such Indebtedness
does not exceed 10% of the total value of the assets
of the Subsidiary so acquired, or of the asset so
acquired, as the case may be;
(xi) Indebtedness under Other Hedging Agreements entered
into by the Borrower or any of its Subsidiaries in
the ordinary course of business and consistent with
past practices and providing protection against
fluctuations in currency values or commodity prices
in connection with the Borrower's or any of its
Subsidiaries' operations so long as management of the
Borrower or such Subsidiary, as the case may be, has
determined that the entering into of such Other
Hedging Agreements are bona fide hedging activities
and are not speculative in nature;
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(xii) with the prior written consent of the Required
Lenders (which consent may be granted or withheld in
their sole discretion), unsecured subordinated
Indebtedness of the Borrower (the "Subordinated
Notes"), so long as (i) at least 15 days prior to the
issuance thereof, the Borrower shall have delivered
to each of the Lenders substantially final drafts of
the documents pursuant to which the Subordinated
Notes are to be issued and with any changes thereto
made after the initial delivery of such documents to
be delivered to the Agents and with any significant
changes thereto made after such initial delivery to
be delivered to each of the Lenders at least five
days prior to the issuance of such new Subordinated
Notes, (ii) the final maturity date thereof is at
least one year beyond the Maturity Date, (iii) there
are no required amortization, mandatory redemption or
sinking fund provisions or similar provisions prior
to one year after the Maturity Date, (iv) all other
terms and conditions thereof (including, without
limitation, interest rates, covenants, defaults,
remedies and subordination provisions) are
satisfactory to the Required Lenders, (v) no Default
or Event of Default then exists or would result
therefrom; (vi) the Borrower shall have delivered to
each of the Agents and each of the Lenders a
certificate of the Borrower's Chief Financial Officer
certifying (and showing the calculations therefor in
reasonable detail) that the Borrower and its
Subsidiaries would have been in compliance with the
financial covenants set forth in Sections 7.09, 7.10,
7.11 and 7.12 for the Test Period then most recently
ended prior to the date of the issuance of the
Subordinated Notes, in each case with such financial
covenants to be determined on a pro forma basis as if
such Subordinated Notes had been issued, and the
proceeds therefrom had been applied, on the first day
of such Test Period (and assuming that such
Subordinated Notes had remained outstanding
throughout such Test Period) and (vii) the Net Debt
Proceeds therefrom are applied in accordance with
Section 3.02(c); and
(xiii) so long as no Default or Event of Default then exists
or would result therefrom, additional Indebtedness of
the Borrower and the Subsidiary Guarantors not
otherwise permitted pursuant to this Section 7.04 not
exceeding $50,000,000 in aggregate principal amount
at any time outstanding, provided that (x) such
Indebtedness may be designated by the Borrower as
"Additional Senior Debt" under the Security Documents
and the Subsidiaries Guaranty, (y) any such
Indebtedness must have a final maturity no earlier
than the Maturity Date and an average life no shorter
than the then remaining average life of the Loans and
(z) the documentation evidencing any such
Indebtedness shall not contain covenants, defaults or
other restrictions which, in the judgment of the
Agents, are more restrictive than those contained in
this Agreement.
7.05 Advances, Investments and Loans. The Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, lend money or credit
or make advances to any Person, or purchase or acquire any stock, obligations
or securities of, or any other interest in, or make any capital contribution
to, any other Person, or purchase or own a futures contract or otherwise become
liable for the purchase or sale of currency or other commodities at a future
date in the nature of a futures contract, or hold any cash or Cash Equivalents
(each of the foregoing an "Investment" and, collectively, "Investments"),
except that the following shall be permitted:
50
(i) the Borrower and its Subsidiaries may acquire and
hold accounts receivables owing to any of them, if
created or acquired in the ordinary course of
business and payable or dischargeable in accordance
with customary trade terms of the Borrower or such
Subsidiary;
(ii) the Borrower and its Subsidiaries may acquire and
hold cash and Cash Equivalents;
(iii) the Borrower and its Subsidiaries may hold the
Investments held by them on the Effective Date and
described on Schedule 7.05, provided that any
additional Investments made with respect thereto
shall be permitted only if independently justified
under the other provisions of this Section 7.05;
(iv) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in
connection with the bankruptcy or reorganization of
suppliers and customers and in good faith settlement
of delinquent obligations of, and other disputes
with, customers and suppliers arising in the ordinary
course of business;
(v) the Borrower and its Subsidiaries may make loans and
advances in the ordinary course of business to their
respective employees so long as the aggregate
principal amount thereof at any time outstanding
(determined without regard to any write-downs or
write-offs of such loans and advances) shall not
exceed $1,000,000;
(vi) the Borrower may acquire and hold obligations of one
or more officers or other employees of the Borrower
or any of its Subsidiaries in connection with such
officers' or employees' acquisition of shares of
common stock of the Borrower so long as no cash is
paid by the Borrower or any of its Subsidiaries to
such officers or employees in connection with the
acquisition of any such obligations;
(vii) the Borrower may enter into Interest Rate Protection
Agreements to the extent permitted by Section
7.04(iii);
(viii) the Borrower and the Subsidiary Guarantors may make
cash common equity contributions to the capital of
their respective Subsidiaries which are Subsidiary
Guarantors;
(ix) the Borrower and the Subsidiary Guarantors may make
intercompany loans and advances between or among one
another;
(x) the Borrower and its Subsidiaries may enter into
Other Hedging Agreements to the extent permitted by
Section 7.04(xi);
(xi) the Borrower and its Subsidiaries may acquire and
hold non-cash consideration issued by the purchaser
of assets in connection with a sale of such assets to
the extent permitted by Section 7.02(v);
(xii) so long as no Default or Event of Default then exists
or would result therefrom, Acme Steel may make cash
Investments, directly or indirectly, in Wabush
pursuant to the joint venture agreements with respect
thereto as in effect on the Effective Date;
(xiii) the Borrower and the Subsidiary Guarantors may make
Permitted Acquisitions to the extent permitted by
Section 7.02(xiii);
(xiv) Investments by the Borrower in securities issued
directly or indirectly and fully guaranteed or
insured by the United States government or any agency
or instrumentality thereof in such amounts as are
needed to, and that are deposited pursuant to the
requirements of the Existing Senior Secured Note
Indentures in order to, effect a defeasance of the
Existing Senior Secured Notes in accordance with the
terms thereof; and
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(xv) the Borrower and its Subsidiaries may make
Investments in Persons that are not Subsidiary
Guarantors and in which the Borrower or any of its
Subsidiaries already has an ownership interest so
long as the aggregate amount of all such Investments
made pursuant to this clause (xv), when added to the
aggregate amount of Permitted Acquisitions made
pursuant to Section 7.02 (xiii), shall not exceed
$15,000,000.
7.06 Transactions with Affiliates. The Borrower will not, and will not permit
any of its Subsidiaries to, enter into any transaction or series of related
transactions, whether or not in the ordinary course of business, with any
Affiliate of the Borrower or any of its Subsidiaries, other than in the
ordinary course of business and on terms and conditions substantially as
favorable to the Borrower or such Subsidiary as would reasonably be obtained by
the Borrower or such Subsidiary at that time in a comparable arm's-length
transaction with a Person other than an Affiliate, except that the following in
any event shall be permitted:
(i) Dividends may be paid to the extent provided in
Section 7.03;
(ii) loans may be made and other transactions may be
entered into by the Borrower and its Subsidiaries to
the extent permitted by Sections 7.02, 7.04 and 7.05;
and
(iii) customary fees may be paid to non-officer directors
of the Borrower and its Subsidiaries or as otherwise
described in Schedule 7.06.
7.07 Leases. The Borrower will not permit the aggregate payments (including,
without limitation, any property taxes paid as additional rent or lease
payments) made by the Borrower and its Subsidiaries on a consolidated basis
under any agreement to rent or lease any real or personal property entered into
on or after the Effective Date (or any extension or renewal thereof) (excluding
Capitalized Lease Obligations) to exceed $3,000,000 in any fiscal year of the
Borrower.
7.08 Capital Expenditures.
(a) The Borrower will not, and will not permit any of its
Subsidiaries to, make any Capital Expenditures, except that
(i) during the period from the Effective Date through and
including the last day of the Borrower's fiscal year ending
closest to December 31, 1998, the Borrower and its
Subsidiaries may make Capital Expenditures in an aggregate
amount not to exceed $35,000,000 and (ii) during any fiscal
year of the Borrower set forth below (taken as one accounting
period), the Borrower and its Subsidiaries may make Capital
Expenditures so long as the aggregate amount of all such
Capital Expenditures does not exceed in any fiscal year of the
Borrower set forth below the amount set forth opposite such
fiscal year below:
Fiscal Year Ending Closest To Amount
------------------ ---------- ------
December 31, 1999 $35,000,000
December 31, 2000 $35,000,000
December 31, 2001 $35,000,000
December 31, 2002 $35,000,000
December 31, 2003 $35,000,000
December 31, 2004 $35,000,000
December 31, 2005 $35,000,000
52
(b) In addition to the foregoing, in the event that the amount of
Capital Expenditures permitted to be made by the Borrower and
its Subsidiaries pursuant to clause (a) above in any fiscal
year of the Borrower (before giving effect to any increase in
such permitted Capital Expenditure amount pursuant to this
clause (b)) is greater than the amount of Capital Expenditures
actually made by the Borrower and its Subsidiaries during such
fiscal year, the lesser of (x) such excess and (y) 15% of the
applicable permitted scheduled Capital Expenditure amount as
set forth in such clause (a) above may be carried forward and
utilized to make Capital Expenditures in the immediately
succeeding fiscal year of the Borrower, provided that no
amounts once carried forward pursuant to this Section 7.08(b)
may be carried forward to any fiscal year thereafter and such
amounts may only be utilized after the Borrower and its
Subsidiaries have utilized in full the permitted Capital
Expenditure amount for such fiscal year as set forth in the
table in clause (a) above (without giving effect to any
increase in such amount by operation of this clause (b)).
(c) In addition to the foregoing, the Borrower and it Subsidiaries
may make Capital Expenditures with the amount of Net Sale
Proceeds received by the Borrower or any of its Subsidiaries
from any Asset Sale so long as such Net Sale Proceeds are
reinvested in assets (other than current assets) used or
useful in the business of the Borrower and its Subsidiaries
within 360 days following the date of such Asset Sale to the
extent such Net Sale Proceeds are not otherwise required to be
applied to repay outstanding Loans pursuant to Section
3.02(d).
(d) In addition to the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures with the amount of
Net Insurance Proceeds received by the Borrower or any of its
Subsidiaries from any Recovery Event so long as such Net
Insurance Proceeds are used to replace or restore any
properties or assets in respect of which such Net Insurance
Proceeds were paid within 360 days following the date of
receipt of such Net Insurance Proceeds from such Recovery
Event to the extent such Net Insurance Proceeds are not
otherwise required to be applied to repay outstanding Loans
pursuant to Section 3.02(f).
(e) In addition to the foregoing, the Borrower and the Subsidiary
Guarantors may make Capital Expenditures constituting
Permitted Acquisitions to the extent permitted by Section
7.02(xiii).
(f) In addition to the foregoing, Acme Steel may make Capital
Expenditures in connection with its blast furnace reline in an
aggregate amount not to exceed $40,000,000 so long as such
Capital Expenditures are made on or prior to the last day of
the Borrower's fiscal year ended closest to December 31, 2000.
(g) In addition to the foregoing, Acme Steel may make Capital
Expenditures in an aggregate amount not to exceed $200,000,000
(plus the cost of capitalized interest and other internally
capitalized costs) in connection with the Phase II Expansion.
(h) In addition to the foregoing, so long as no Default or Event
of Default then exists or would result therefrom, the Borrower
and its Subsidiaries may make Capital Expenditures in October
2002 in an aggregate amount not to exceed $15,000,000 to
purchase the property located in Walbridge, Ohio subject to an
existing Alpha Tube lease.
7.09 Consolidated Interest Coverage Ratio. The Borrower will not permit the
Consolidated Interest Coverage Ratio of the Borrower for any Test Period ending
on the last day of a fiscal quarter set forth below to be less than the ratio
set forth opposite such fiscal quarter below:
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Fiscal Quarter Ending Closest To Ratio
-------------------------------- ---------
June 30, 1998 1.00:1.00
September 30, 1998 1.15:1.00
December 31, 1998 1.40:1.00
March 31, 1999 1.40:1.00
June 30, 1999 1.40:1.00
September 30, 1999 1.40:1.00
December 31, 1999 1.75:1.00
March 31, 2000 1.75:1.00
June 30, 2000 1.75:1.00
September 30, 2000 1.75:1.00
December 31, 2000 2.00:1.00
March 31, 2001 2.00:1.00
June 30, 2001 2.00:1.00
September 30, 2001 2.00:1.00
December 31, 2001 2.25:1.00
March 31, 2002 2.25:1.00
June 30, 2002 2.25:1.00
September 30, 2002 2.25:1.00
December 31, 2002 2.50:1.00
March 31, 2003 2.50:1.00
June 30, 2003 2.50:1.00
September 30, 2003 2.50:1.00
December 31, 2003 2.75:1.00
March 31, 2004 2.75:1.00
June 30, 2004 2.75:1.00
September 30, 2004 2.75:1.00
December 31, 2004
and the last day of each
fiscal quarter thereafter 3.00:1.00
54
7.10 Maximum Leverage Ratio. The Borrower will not permit the Leverage Ratio
of the Borrower at any time during a period set forth below to be greater than
the ratio set forth opposite such period below:
Period Ratio
------ -----
The last day of the fiscal quarter ending closest to December 31, 1998
through and including the day before the last day of the fiscal
quarter ending closest to June 30, 1999 7.50:1.00
The last day of the fiscal quarter ending closest to June 30, 1999
through and including the day before the last day of the fiscal
quarter ending closest to December 31, 1999 6.50:1.00
The last day of the fiscal quarter ending closest to December 31, 1999
through and including the day before the last day of the fiscal
quarter ending closest to June 30, 2000 5.50:1.00
The last day of the fiscal quarter ending closest to June 30, 2000
through and including the day before the last day of the fiscal
quarter ending closest to December 31, 2000 5.25:1.00
The last day of the fiscal quarter ending closest to December 31, 2000
through and including the day before the last day of the fiscal
quarter ending closest to June 30, 2001 5.00:1.00
The last day of the fiscal quarter ending closest to June 30, 2001
through and including the day before the last day of the fiscal
quarter ending closest to December 31, 2001. 4.75:1.00
The last day of the fiscal quarter ending closest to December 31, 2001
through and including the day before the last day of the fiscal
quarter ending closest to June 30, 2002 4.50:1.00
The last day of the fiscal quarter ending closest to June 30, 2002
through and including the day before the last day of the fiscal
quarter ending closest to December 30, 2002 4.25:1.00
The last day of the fiscal quarter ending closest to December 31, 2002
through and including the day before the last day of the fiscal
quarter ending closest to June 30, 2003 4.00:1.00
The last day of the fiscal quarter ending closest to June 30, 2003
through and including the day before the last day of the fiscal
quarter ending closest to December 31, 2003 3.75:1.00
The last day of the fiscal quarter ending closest to December 31, 2003
and thereafter 3.50:1.00
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CONFORMED AS EXECUTED]
7.11 Minimum Consolidated EBITDA. The Borrower will not permit Consolidated
EBITDA of the Borrower for any Test Period ending on the last day of a fiscal
quarter set forth below to be less than the amount set forth opposite such
fiscal quarter below:
Fiscal Quarter Ending Closest To Amount
-------------------------------- ------
March 31, 1998 $ 5,000,000
June 30, 1998 $19,000,000
September 30, 1998 $35,000,000
December 31, 1998 $55,000,000
March 31, 1999 $55,000,000
June 30, 1999 $55,000,000
September 30, 1999 $55,000,000
December 31, 1999 $75,000,000
March 31, 2000 $75,000,000
June 30, 2000 $75,000,000
September 30, 2000 $75,000,000
December 31, 2000
and the last day of
each fiscal quarter
thereafter $80,000,000
7.12 Consolidated Fixed Charge Coverage Ratio. The Borrower will not permit
the Consolidated Fixed Charge Coverage Ratio of the Borrower for any Test
Period ending on the last day of a fiscal quarter set forth below to be less
than the ratio set forth opposite such fiscal quarter below:
56
Fiscal Quarter Ending Closest To Ratio
-------------------------------- -----
December 31, 1998 1.10:1.00
March 31, 1999 1.10:1.00
June 30, 1999 1.10:1.00
September 30, 1999 1.10:1.00
December 31, 1999 1.15:1.00
March 31, 2000 1.15:1.00
June 30, 2000 1.15:1.00
September 30, 2000 1.15:1.00
December 31, 2000
and the last day
each fiscal quarter thereafter 1.25:1.00
7.13 Limitation on Payments of Certain Indebtedness; Modifications of Certain
Indebtedness; Modifications of Certificate of Incorporation, By-Laws and
Certain Other Agreements; etc. The Borrower will not, and will not permit any
of its Subsidiaries to, (i) make (or give any notice in respect of) any
voluntary or optional payment or prepayment on or redemption or acquisition for
value of, or any prepayment or redemption as a result of any asset sale, change
of control or similar event of (including in each case, without limitation, by
way of depositing with the trustee with respect thereto or any other Person
money or securities before due for the purpose of paying when due) the New
Senior Notes, the Subordinated Notes, the Parallel Loan or the Environmental
Bonds, (ii) amend or modify, or permit the amendment or modification of, any
provision of the New Senior Note Documents or the Subordinated Note Documents,
(iii) amend or modify, or permit the amendment or modification of, any
provision of any Existing Senior Secured Note Documents other than pursuant to
the Existing Senior Secured Notes Consent Solicitation, (iv) amend or modify,
or permit the amendment or modification of, any provision of the Working
Capital Facility (including as a result of a refinancing or replacement
thereof), the Parallel Loan or the Environmental Bonds to the extent that same
could be adverse to the interests of the Lenders, it being understood and
agreed that, in any event, any amendment or modification which shortens the
maturity thereof, adversely changes the mandatory prepayments or repayments
thereof, increases the interest rate thereon, makes the financial maintenance
covenants contained therein more restrictive or otherwise adds new financial
maintenance covenants (whether constructed as a covenant or a default) shall
not be permitted, (v) amend, modify or change its certificate of incorporation
(including, without limitation, by the filing or modification of any
certificate of designation) or by-laws (or the equivalent organizational
documents) or any agreement entered into by it with respect to its capital
stock, or enter into any new agreement with respect to its capital stock,
unless such amendment, modification, change or other action contemplated by
this clause (v) could not reasonably be adverse to the interests of the Lenders
in any material respect, or (vi) amend, modify or change any provision of the
joint venture arrangements for Wabush, the Interlake Cross-Indemnification
Indemnity Agreement or any Tax Sharing Agreement (including the Interlake Tax
Indemnity Agreement), unless such amendment, modification or change could not
reasonably be expected to be adverse in any material respect to the interests
of the Lenders or the Borrower or any of its Subsidiaries.
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7.14 Limitation on Certain Restrictions on Subsidiaries. The Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly,
create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by the Borrower or any
Subsidiary of the Borrower, or pay any Indebtedness owed to the Borrower or
any Subsidiary of the Borrower, (b) make loans or advances to the Borrower or
any Subsidiary of the Borrower or (c) transfer any of its properties or assets
to the Borrower or any Subsidiary of the Borrower, except for such encumbrances
or restrictions existing under or by reason of (i) applicable law, (ii) this
Agreement and the other Credit Documents, (iii) the New Senior Note Documents,
(iv) the Working Capital Facility, (v) customary provisions restricting
subletting or assignment of any lease governing a leasehold interest of the
Borrower or any Subsidiary of the Borrower, (vi) customary provisions
restricting assignment of any licensing agreement or other contract entered
into by the Borrower or any Subsidiary of the Borrower in the ordinary course
of business and (vii) restrictions on the transfer of any asset subject to a
Lien permitted by Sections 7.01(vii), (viii) and (xv).
7.15 Limitation on Issuance of Capital Stock.
(a) The Borrower will not, and will not permit any of its
Subsidiaries to, issue (i) any preferred stock other than
Qualified Preferred Stock of the Borrower (including any such
preferred stock issuable under the Borrower's Rights Agreement
as in effect on the Effective Date) or (ii) any redeemable
common stock (other than common stock that is redeemable at
the sole option of the Borrower or such Subsidiary).
(b) The Borrower will not permit any of its Subsidiaries to issue
any capital stock (including by way of sales of treasury
stock) or any options or warrants to purchase, or securities
convertible into, capital stock, except (i) for transfers and
replacements of then outstanding shares of capital stock, (ii)
for stock splits, stock dividends and issuances which do not
decrease the percentage ownership of the Borrower or any of
its Subsidiaries in any class of the capital stock of such
Subsidiary, (iii) to qualify directors to the extent required
by applicable law or (iv) for issuances by newly created or
acquired Subsidiaries in accordance with the terms of this
Agreement.
7.16 Business. The Borrower and its Subsidiaries will not engage in any
business other than the businesses engaged in by the Borrower and its
Subsidiaries as of the Effective Date and reasonable extensions thereof (it
being understood and agreed that any steel fabricating business shall be deemed
a reasonable extension of the Borrower's and its Subsidiaries' existing
businesses).
58
7.17 Limitation on Creation of Subsidiaries. Notwithstanding anything to the
contrary contained in this Agreement, the Borrower will not, and will not
permit any of its Subsidiaries to, establish, create or acquire after the
Effective Date any Subsidiary, provided that the Borrower and its Wholly-Owned
Subsidiaries shall be permitted to establish or create Wholly-Owned
Subsidiaries so long as (i) the capital stock of each such new Wholly-Owned
Subsidiary is pledged pursuant to, and to the extent required by, the Pledge
Agreement and the certificates representing such stock, together with stock
powers duly executed in blank, are delivered to the Collateral Agent for the
benefit of the Secured Creditors, (ii) each such new Wholly-Owned Subsidiary
executes and delivers to the Collateral Agent a counterpart of the Subsidiaries
Guaranty, the Pledge Agreement and, in the case of a Wholly-Owned Subsidiary
that is a Granting Credit Party, the Security Agreement, and (iii) each such
new Wholly-Owned Subsidiary to the extent that same is a Granting Credit Party,
to the extent requested by the Collateral Agent or the Required Lenders, takes
all actions required pursuant to Section 6.12. In addition, each new
Wholly-Owned Subsidiary shall execute and deliver, or cause to be executed and
delivered, to the Administrative Agent all other relevant documentation of the
type described in Section 4 as such new Wholly-Owned Subsidiary would have had
to deliver if such new Wholly-Owned Subsidiary were a Credit Party on the
Effective Date.
SECTION 8. Events of Default. Upon the occurrence of any of the following
specified events (each an "Event of Default"):
8.01 Payments. The Borrower shall (i) default in the payment when due of any
principal of any Loan or any Note or (ii) default, and such default shall
continue unremedied for five or more days, in the payment when due of any
interest on any Loan or any Note or any Fees or any other amounts owing
hereunder or thereunder; or
8.02 Representations, etc. Any representation, warranty or statement made (or
deemed made) by any Credit Party herein or in any other Credit Document or in
any certificate delivered to the Administrative Agent or any Lender pursuant
hereto or thereto shall prove to be untrue in any material respect on the date
as of which made or deemed made; or
8.03 Covenants. Any Credit Party shall (i) default in the due performance or
observance by it of any term, covenant or agreement contained in Section
6.01(e)(i) or 6.08 or Section 7 or (ii) default in the due performance or
observance by it of any other term, covenant or agreement contained in this
Agreement or any other Credit Document (other than those set forth in Sections
8.01 and 8.02) and such default shall continue unremedied for a period of 30
days after written notice thereof to the defaulting party by the Administrative
Agent or the Required Lenders; or
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8.04 Default Under Other Agreements.
(i) The Borrower or any of its Subsidiaries shall (x)
default in any payment of any Indebtedness (other
than the Obligations) beyond the period of grace, if
any, provided in the instrument or agreement under
which such Indebtedness was created or (y) default in
the observance or performance of any agreement or
condition relating to any Indebtedness (other than
the Obligations) or contained in any instrument or
agreement evidencing, securing or relating thereto,
or any other event shall occur or condition exist,
the effect of which default or other event or
condition is to cause, or to permit the holder or
holders of such Indebtedness (or a trustee or agent
on behalf of such holder or holders) to cause
(determined without regard to whether any notice is
required), any such Indebtedness to become due prior
to its stated maturity, or (ii) any Indebtedness
(other than the Obligations) of the Borrower or any
of its Subsidiaries shall be declared to be (or shall
become) due and payable, or required to be prepaid
other than by a regularly scheduled required
prepayment, prior to the stated maturity thereof,
provided that it shall not be a Default or an Event
of Default under this Section 8.04 unless the
aggregate principal amount of all Indebtedness as
described in preceding clauses (i) and (ii) is at
least $5,000,000; or
8.05 Bankruptcy, etc. The Borrower or any of its Subsidiaries shall commence a
voluntary case concerning itself under Title 11 of the United States Code
entitled "Bankruptcy," as now or hereafter in effect, or any successor thereto
(the "Bankruptcy Code"); or an involuntary case is commenced against the
Borrower or any of its Subsidiaries, and the petition is not controverted
within 10 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) is appointed for, or
takes charge of, all or substantially all of the property of the Borrower or
any of its Subsidiaries, or the Borrower or any of its Subsidiaries commences
any other proceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction whether now or hereafter in effect relating to the Borrower or any
of its Subsidiaries, or there is commenced against the Borrower or any of its
Subsidiaries any such proceeding which remains undismissed for a period of 60
days, or the Borrower or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or the Borrower or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Borrower or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or any corporate action is taken by the Borrower or any of its
Subsidiaries for the purpose of effecting any of the foregoing; or
8.06 Security Documents. At any time after the execution and delivery
thereof, any of the Security Documents shall cease to be in full force and
effect, or shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported to be
created thereby (including, without limitation, a perfected security interest
in, and Lien on, all of the Collateral) in favor of the Collateral Agent,
superior to and prior to the rights of all third Persons (except as permitted
by Section 7.01), and subject to no other Liens (except as permitted by Section
7.01); or
60
8.07 Subsidiaries Guaranty. At any time after the execution and delivery
thereof, the Subsidiaries Guaranty or any provision thereof shall cease to be
in full force or effect as to any Subsidiary Guarantor (except as a result of
any event described in clause (iv), (x), (xi) or (xii) of Section 7.02), or any
Subsidiary Guarantor or any Person acting by or on behalf of such Subsidiary
Guarantor shall deny or disaffirm such Subsidiary Guarantor's obligations under
the Subsidiaries Guaranty or any Subsidiary Guarantor shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to the Subsidiaries Guaranty; or
8.08 Judgments. One or more judgments or decrees shall be entered against the
Borrower or any Subsidiary of the Borrower involving in the aggregate for the
Borrower and its Subsidiaries a liability (not paid or fully covered by a
reputable and solvent insurance company) and such judgments and decrees either
shall be final and non-appealable or shall not be vacated, discharged or stayed
or bonded pending appeal for any period of 30 consecutive days, and the
aggregate amount of all such judgments equals or exceeds $2,500,000; or
8.09 Change of Control. A Change of Control shall occur; then, and in any
such event, and at any time thereafter, if any Event of Default shall then be
continuing, the Administrative Agent, upon the written request of the Required
Lenders, shall by written notice to the Borrower, take any or all of the
following actions, without prejudice to the rights of the Administrative Agent,
any Lender or the holder of any Note to enforce its claims against any Credit
Party (provided, that, if an Event of Default specified in Section 8.05 shall
occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent as specified in clauses
(i) and (ii) below shall occur automatically without the giving of any such
notice): (i) declare the Total Commitment terminated, whereupon the
Commitments of each Lender shall forthwith terminate immediately; (ii) declare
the principal of and any accrued interest in respect of all Loans and the Notes
and all Obligations owing hereunder and thereunder to be, whereupon the same
shall become, forthwith due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by each Credit Party;
and (iii) enforce, as Collateral Agent, all of the Liens and security interests
created pursuant to the Security Documents.
SECTION 9. Definitions and Accounting Terms.
9.01 Defined Terms. As used in this Agreement, the following terms shall have
the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):
"Acme Steel" shall mean Acme Steel Company, a Delaware corporation.
"Additional Security Documents" shall have the meaning provided in Section
6.11.
"Adjusted Consolidated Net Income" shall mean, for any period, Consolidated Net
Income for such period plus, without duplication, the sum of the amount of all
net non-cash charges (including, without limitation, depreciation,
amortization, deferred tax expense and non-cash interest expense) and net
non-cash losses which were included in arriving at Consolidated Net Income for
such period, less the amount of all net non-cash gains which were included in
arriving at Consolidated Net Income for such period.
"Administrative Agent" shall mean BTCo, in its capacity as Administrative Agent
for the Lenders hereunder, and shall include any successor to the
Administrative Agent appointed pursuant to Section 10.09.
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CONFORMED AS EXECUTED]
"Affiliate" shall mean, with respect to any Person, any other Person directly
or indirectly controlling (including, but not limited, to all directors and
officers of such Person), controlled by, or under direct or indirect common
control with, such Person. A Person shall be deemed to control another Person
if such Person possesses, directly or indirectly, the power (i) to vote 10% or
more of the securities having ordinary voting power for the election of
directors of such corporation or (ii) to direct or cause the direction of the
management and policies of such other Person, whether through the ownership of
voting securities, by contract or otherwise.
"Agent" shall mean and include the Administrative Agent and the Syndication
Agent.
"Agreement" shall mean this Credit Agreement, as modified, supplemented,
amended, restated (including any amendment and restatement hereof), extended,
renewed, refinanced or replaced from time to time.
"Alpha Tube" shall mean Alpha Tube Corporation, a Delaware corporation.
"Applicable Base Rate Margin" shall mean (i) for the period from the Effective
Date through but not including the first Start Date after the Effective Date,
1.75%, provided, however, if the Borrower's Consolidated EBITDA for the Test
Period ending closest to June 30, 1998 is less than $25,000,000, then the
Applicable Base Rate Margin from the date of delivery of the financial
statements pursuant to Section 6.01(b) in respect of such Test Period through
but not including the first Start Date shall instead be 2.000%, and (ii) from
and after any Start Date to and including the corresponding End Date, the
respective percentage per annum set forth in clause (A), (B), (C), (D), (E) or
(F) below if, but only if, as of the Test Date for such Start Date the
applicable condition set forth in clause (A), (B), (C), (D), (E) or (F) below,
as the case may be, is met:
(A) 2.250% if, but only if, as of the Test Date for such Start
Date, the Leverage Ratio for the Test Period ended on such
Test Date shall be greater than or equal to 6.50:1.00;
(B) 2.000% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 6.50:1.00 and greater than or equal to
5.50:1.00;
(C) 1.750% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 5.50:1.00 and greater than or equal to
5.00:1.00;
(D) 1.500% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 5.00:1.00 and greater than or equal to
4.50:1.00;
(E) 1.375% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 4.50:1.00 and greater than or equal to
4.00:1.00; and
(F) 1.250% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 4.00:1.00.
Notwithstanding anything to the contrary above in this definition, the
Applicable Base Rate Margin shall be 2.250% at all times when a Default or an
Event of Default shall exist.
62
"Applicable Eurodollar Rate Margin" shall mean (i) for the period from the
Effective Date through but not including the first Start Date after the
Effective Date, 2.75%, provided, however, if the Borrower's Consolidated EBITDA
for the Test Period ending closest to June 30, 1998 is less than $25,000,000,
then the Applicable Eurodollar Rate Margin from the date of delivery of the
financial statements pursuant to Section 6.01(b) in respect of such Test Period
through but not including the first Start Date shall instead be 3.000%, and
(ii) from and after any Start Date to and including the corresponding End Date,
the respective percentage per annum set forth in clause (A), (B), (C), (D), (E)
or (F) below if, but only if, as of the Test Date for such Start Date the
applicable condition set forth in clause (A), (B), (C), (D), (E) or (F) below,
as the case may be, is met:
(A) 3.250% if, but only if, as of the Test Date for such Start
Date, the Leverage Ratio for the Test Period ended on such
Test Date shall be greater than or equal to 6.50:1.00;
(B) 3.000% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 6.50:1.00 and greater than or equal to
5.50:1.00;
(C) 2.750% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 5.50:1.00 and greater than or equal to
5.00:1.00;
(D) 2.500% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 5.00:1.00 and greater than or equal to
4.50:1.00;
(E) 2.375% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 4.50:1.00 and greater than or equal to
4.00:1.00; and
(F) 2.250% if, but only if, as of the Test Date for such Start
Date the Leverage Ratio for the Test Period ended on such Test
Date shall be less than 4.00:1.00.
Notwithstanding anything to the contrary above in this definition, the
Applicable Eurodollar Rate Margin shall be 3.250% at all times when a Default
or an Event of Default shall exist.
"Applicable Margin Period" shall mean each period which shall commence on a
date on which the financial statements are delivered pursuant to Section
6.01(a) or (b), as the case may be, and which shall end on the earlier of (i)
the date of the actual delivery of the next financial statements pursuant to
Section 6.01(a) or (b), as the case may be, and (ii) the latest date on which
the next financial statements are required to be delivered pursuant to Section
6.01(a) or (b), as the case may be, provided that the first Applicable Margin
Period shall commence with the delivery of the Borrower's financial statements
for the Test Period ending closest to December 31, 1998.
"Asset Sale" shall mean any sale, transfer or other disposition by the Borrower
or any of its Subsidiaries to any Person (including by way of redemption by
such Person) other than to the Borrower or a Wholly-Owned Subsidiary of the
Borrower of any asset (including, without limitation, any capital stock or
other securities of, or equity interests in, another Person) other than sales
of assets pursuant to Sections 7.02 (ii), (iii), (iv), (viii) and (ix).
"Assignment and Assumption Agreement" shall mean an Assignment and Assumption
Agreement substantially in the form of Exhibit K (appropriately completed).
"Bank Refinancing" shall mean the repayment in full of the Existing Term Loan
Agreement, together with all accrued interest, premiums, fees, commission and
expenses owing in connection therewith, and the termination of all commitments
thereunder.
"Bankruptcy Code" shall have the meaning provided in Section 8.05.
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"Base Rate" shall mean, at any time, the higher of (i) the Prime Lending Rate
and (ii) 1/2 of 1% in excess of the Federal Funds Rate.
"Base Rate Loan" shall mean each Loan designated or deemed designated as such
by the Borrower at the time of the incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first paragraph of this
Agreement.
"Borrowing" shall mean (i) the incurrence of one Type of Loan from all the
Lenders on the Effective Date and (ii) thereafter, the conversion or
conversions of one or more Types of Loans into another Type of Loan on a given
date having (in each case) in the case of Eurodollar Loans the same Interest
Period, provided that Base Rate Loans incurred pursuant to Section 1.10(b)
shall be considered part of the related Borrowing of Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company, in its individual capacity, and any
successor corporation thereto, by merger, consolidation or otherwise.
"Business Day" shall mean (i) for all purposes other than as covered by clause
(ii) below, any day except Saturday, Sunday and any day which shall be in
Chicago, Illinois and New York City, New York, a legal holiday or a day on
which banking institutions are authorized or required by law or other
government action to close and (ii) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
Eurodollar Loans, any day which is a Business Day described in clause (i) above
and which is also a day for trading by and between banks in the New York
interbank Eurodollar market.
"Capital Expenditures" shall mean, with respect to any Person, all expenditures
by such Person which should be capitalized in accordance with generally
accepted accounting principles and, without duplication, the amount of
Capitalized Lease Obligations incurred by such Person.
"Capitalized Lease Obligations" shall mean, with respect to any Person, all
rental obligations of such Person which, under generally accepted accounting
principles, are or will be required to be capitalized on the books of such
Person, in each case taken at the amount thereof accounted for as indebtedness
in accordance with such principles.
64
"Cash Equivalents" shall mean (a)(i) obligations of or guaranteed by the U.S.
government, its agencies or government-sponsored enterprises, (ii) short-term
commercial bank and corporate obligations that have received the highest rating
from two of the following rating organizations: Standard & Poor's Ratings
Services ("S&P"), Xxxxx'x Investors Service, Inc. ("Moody's"), Duff & Xxxxxx
Credit Rating Co., Fitch Investor Service, Inc., IBCA Ltd. and Thomson
Bankwatch, Inc., (iii) money market preferred stocks which, at the date of
acquisition, are accorded ratings of at least A- or A3 by S&P or Moody's,
respectively, (iv) tax-exempt obligations that are accorded ratings at the time
of purchase of at least A- or A3 (or equivalent short-term ratings) by S&P or
Moody's, respectively, (v) master repurchase agreements with foreign or
domestic banks having a capital and surplus of not less than $250,000,000 or
primary dealers so long as such agreements are collateralized with obligations
of the U.S. government or its agencies at a ratio of 102% or with other
collateral rated at least AA or Aa2 by S&P or Moody's, respectively, at a ratio
of 103% and, in either case, marked-to-market weekly and held by a third-party
agent, (vi) guaranteed investment contracts and/or agreements of a bank,
insurance company or other institution whose unsecured and unguaranteed
obligations (or claims-paying ability) have, at the time of purchase, ratings
of at least AAA or Aaa by S&P or Moody's, respectively, (vii) time deposits
with, and certificates of deposits and banker's acceptances issued by, any bank
having capital surplus and undivided profits aggregating at least $50,000,000,
and (viii) money market funds substantially all of whose assets are comprised
of securities of the types described in clauses (i) through (vii) above. In no
event shall any of the Cash Equivalents described in clauses (i) through (vii)
above have a final maturity more than one year from the date of purchase.
"CERCLA" shall mean the Comprehensive Environmental Response, Compensation, and
Liability Act of 1980, as the same may be amended from time to time, 42 U.S.C.
Section 9601 et seq.
"Change of Control" shall mean (i) any Person or "group" (within the meaning of
Rules 13d-3 or 13d-5 under the Securities Exchange Act (as in effect on the
Effective Date)) shall (A) have acquired beneficial ownership of 35% or more on
a fully diluted basis of the voting and/or economic interest in the Borrower's
capital stock or (B) have obtained power (whether or not exercised) to elect a
majority of the Borrower's directors, (ii) the Board of Directors of the
Borrower shall cease to consist of a majority of Continuing Directors or (iii)
a "change of control" or similar event shall occur under, and as defined in,
the New Senior Note Documents, the Subordinated Note Documents, the Working
Capital Facility or, until such time as the Existing Senior Secured Notes have
been repaid in full or defeased in accordance with the terms thereof, the
Existing Senior Secured Note Documents.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code, as in effect at the date of this
Agreement and any subsequent provisions of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or personal) with respect to
which any security interests have been granted (or purported to be granted)
pursuant to any Security Document, including, without limitation, all Pledge
Agreement Collateral, all Security Agreement Collateral and the Mortgaged
Properties.
"Collateral Agency Agreement" shall have the meaning provided in Section
4.08(b).
"Collateral Agent" shall mean the Administrative Agent acting as collateral
agent for the Secured Creditors pursuant to the Security Documents.
"Commitment" shall mean, for each Lender, the amount set forth opposite such
Lender's name in Schedule 1.01(a) directly below the column entitled
"Commitment," as same may be terminated pursuant to Section 2.02 or 8.
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"Consolidated Cash Interest Expense" shall mean, for any period, Consolidated
Interest Expense for such period to the extent that same is paid or payable (or
is accrued and will be paid or payable) in cash for such period (net of any
cash interest income for such period).
"Consolidated EBIT" shall mean, for any period, Consolidated Net Income for
such period before Consolidated Interest Expense and provision for taxes for
such period and without giving effect (x) to any extraordinary gains or losses
and (y) to any gains or losses from sales of assets other than from sales of
inventory sold in the ordinary course of business and other sales of $1,000,000
or less.
"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT for such
period, adjusted by adding thereto (i) the amount of all amortization of
intangibles and depreciation that were deducted in arriving at Consolidated
EBIT for such period, (ii) the Borrower's proportionate share of the net income
of Wabush and NACME for such period (based on the Borrower's percentage equity
ownership interest in such Persons), whether or not such net income is actually
distributed to the Borrower or a Subsidiary thereof during such period, but
only to the extent that such net income is not otherwise included in arriving
at Consolidated EBIT for such period and (iii) the expensed (as opposed to
capitalized) portion of the Capital Expenditures incurred for the blast furnace
reline pursuant to Section 7.08(f) to the extent that same reduced Consolidated
EBIT for such period.
"Consolidated Fixed Charge Coverage Ratio" shall mean, for any period, the
ratio of Consolidated EBITDA to Consolidated Fixed Charges for such period.
"Consolidated Fixed Charges" shall mean, for any period, the sum, without
duplication, of (i) Consolidated Cash Interest Expense for such period, (ii)
the amount of all Capital Expenditures made by the Borrower and its
Subsidiaries pursuant to Sections 7.08(a) and (b) for such period, (iii) the
scheduled principal amount of all amortization payments on all Indebtedness
(including, without limitation, the principal component of all Capitalized
Lease Obligations but excluding the refinancings effected pursuant to the
Transaction) of the Borrower and its Subsidiaries for such period (as
determined on the first day of such period) and (iv) the amount of all cash
payments made by the Borrower and its Subsidiaries in respect of income taxes
or income tax liabilities for such period net of any cash income tax refunds
actually received by the Borrower and its Subsidiaries during such period.
"Consolidated Indebtedness" shall mean, at any time, the principal amount of
all Indebtedness of the Borrower and its Subsidiaries at such time as
determined on a consolidated basis, other than any amounts owing under any
Interest Rate Protection Agreement or Other Hedging Agreement except to the
extent that such amounts are required to be reflected on the liability side of
a balance sheet in accordance with GAAP.
"Consolidated Interest Coverage Ratio" shall mean, for any period, the ratio of
Consolidated EBITDA to Consolidated Cash Interest Expense for such period.
66
"Consolidated Interest Expense" shall mean, for any period, the total
consolidated interest expense of the Borrower and its Subsidiaries for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, that portion of Capitalized Lease Obligations of the
Borrower and its Subsidiaries representing the interest factor for such period,
provided that the amortization of deferred financing, legal and accounting
costs with respect to the Transaction and the Phase II Expansion shall be
excluded from Consolidated Interest Expense to the extent same would otherwise
have been included therein.
"Consolidated Net Income" shall mean, for any period, the net income (or loss)
of the Borrower and its Subsidiaries for such period, determined on a
consolidated basis (after any deduction for minority interests), provided that
in determining Consolidated Net Income, (i) the net income of any other Person
which is not a Subsidiary of the Borrower or is accounted for by the Borrower
by the equity method of accounting shall be included only to the extent of the
payment of cash dividends or distributions by such other Person to the Borrower
or a Subsidiary thereof during such period, (ii) the net income (or loss) of
any other Person acquired by such specified Person or a Subsidiary of such
Person in a pooling of interests transaction for any period prior to the date
of such acquisition shall be excluded, (iii) the net income of any Subsidiary
of the Borrower shall be excluded to the extent that the declaration or payment
of dividends or similar distributions by that Subsidiary of its income is not
at the time permitted by operation of the terms of its charter or any
agreement, instrument or law applicable to such Subsidiary (other than the
Working Capital Facility) and (iv) any interest income for such period shall be
excluded.
"Contingent Obligation" shall mean, as to any Person, any obligation of such
Person as a result of such Person being a general partner of the other Person,
unless the underlying obligation is expressly made non-recourse as to such
general partner, and any obligation of such Person guaranteeing or intended to
guarantee any Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any manner,
whether directly or indirectly, including, without limitation, any obligation
of such Person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds (x) for the purchase or payment of any such
primary obligation or (y) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation or
(iv) otherwise to assure or hold harmless the holder of such primary obligation
against loss in respect thereof; provided, however, that the term Contingent
Obligation shall not include endorsements of instruments for deposit or
collection in the ordinary course of business. The amount of any Contingent
Obligation shall be deemed to be an amount equal to the stated or determinable
amount of the primary obligation in respect of which such Contingent Obligation
is made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of the Borrower on the
Effective Date and each other director of the Borrower if such director's
nomination for election to the Board of Directors of the Borrower is
recommended by a majority of the then Continuing Directors.
"Credit Documents" shall mean this Agreement and, after the execution and
delivery thereof pursuant to the terms of this Agreement, each Note, the
Subsidiaries Guaranty and each Security Document.
"Credit Party" shall mean the Borrower and each Subsidiary Guarantor.
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"Default" shall mean any event, act or condition which with notice or lapse of
time, or both, would constitute an Event of Default.
"Dividend" shall mean, with respect to any Person, that such Person has
declared or paid a dividend or returned any equity capital to its stockholders
or partners or authorized or made any other distribution, payment or delivery
of property (other than common stock of such Person) or cash to its
stockholders or partners as such, or redeemed, retired, purchased or otherwise
acquired, directly or indirectly, for a consideration any shares of any class
of its capital stock or any partnership interests outstanding on or after the
Effective Date (or any options or warrants issued by such Person with respect
to its capital stock), or set aside any funds for any of the foregoing
purposes, or shall have permitted any of its Subsidiaries to purchase or
otherwise acquire for a consideration any shares of any class of the capital
stock or any partnership interests of such Person outstanding on or after the
Effective Date (or any options or warrants issued by such Person with respect
to its capital stock). Without limiting the foregoing, "Dividends" with
respect to any Person shall also include all payments made or required to be
made by such Person with respect to any stock appreciation rights, plans,
equity incentive or achievement plans or any similar plans or setting aside of
any funds for the foregoing purposes.
"Documents" shall mean and include (i) the Credit Documents, (ii) the Existing
Senior Secured Notes Tender Offer Documents, (iii) the Existing Senior Secured
Notes Consent Solicitation Documents, (iv) the New Senior Note Documents and
(v) the Working Capital Facility.
"Dollars" and the sign "$" shall each mean freely transferable lawful money of
the United States.
"Effective Date" shall have the meaning provided in Section 11.10.
"Eligible Transferee" shall mean and include a commercial bank, financial
institution, any fund that invests in loans or any other "accredited investor"
(as defined in Regulation D of the Securities Act).
"End Date" shall mean, for any Applicable Margin Period, the last day of such
Applicable Margin Period.
"Environmental Bonds" shall mean those items of Indebtedness of the Borrower
identified as such on Schedule 5.22.
"Environmental Claims" shall mean any and all administrative, regulatory or
judicial actions, suits, demands, demand letters, directives, claims, liens,
notices of noncompliance or violation, investigations or proceedings relating
in any way to any Environmental Law or any permit issued, or any approval
given, under any such Environmental Law (hereafter, "Claims"), including,
without limitation, (a) any and all Claims by governmental or regulatory
authorities for enforcement, cleanup, removal, response, remedial or other
actions or damages pursuant to any applicable Environmental Law, and (b) any
and all Claims by any third party seeking damages, contribution,
indemnification, cost recovery, compensation or injunctive relief in connection
with alleged injury or threat of injury to health, safety or the environment
due to the presence of Hazardous Materials.
68
"Environmental Law" shall mean any Federal, state, foreign or local statute,
law, rule, regulation, ordinance, code, guideline, written policy and rule of
common law now or hereafter in effect and in each case as amended, and any
judicial or administrative interpretation thereof, including any judicial or
administrative order, consent decree or judgment, relating to the environment,
employee health and safety or Hazardous Materials, including, without
limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C.
Section 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section
2601 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. Section 3803 et seq.; the Oil Pollution Act of
1990, 33 U.S.C. Section 2701 et seq.; the Emergency Planning and the Community
Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq.; the Hazardous
Material Transportation Act, 49 U.S.C. Section 1801 et seq. and the
Occupational Safety and Health Act, 29 U.S.C. Section 651 et seq.; and any
state and local or foreign counterparts or equivalents, in each case as amended
from time to time.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA, as in effect at the date
of this Agreement and any subsequent provisions of ERISA, amendatory thereof,
supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9) of ERISA)
which together with the Borrower or a Subsidiary of the Borrower would be
deemed to be a "single employer" (i) within the meaning of Section 414(b), (c),
(m) or (o) of the Code or (ii) as a result of the Borrower or a Subsidiary of
the Borrower being or having been a general partner of such person.
"Eurodollar Loan" shall mean each Loan designated as such by the Borrower at
the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean (a) the offered quotation to first-class banks in
the New York interbank Eurodollar market by the Administrative Agent for Dollar
deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the Eurodollar Loan of the Administrative Agent
with maturities comparable to the Interest Period applicable to such Eurodollar
Loan commencing two Business Days thereafter as of 11:00 A.M. (New York time)
on the date which is two Business Days prior to the commencement of such
Interest Period, divided (and rounded upward to the nearest 1/16 of 1%) by (b)
a percentage equal to 100% minus the then stated maximum rate of all reserve
requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves required by applicable law) applicable
to any member bank of the Federal Reserve System in respect of Eurocurrency
funding or liabilities as defined in Regulation D (or any successor category of
liabilities under Regulation D).
"Event of Default" shall have the meaning provided in Section 8.
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"Excess Cash Flow" shall mean, for any period, the remainder of (a) Adjusted
Consolidated Net Income for such period, minus (b) the sum of, without
duplication, (i) the amount of all Capital Expenditures made by the Borrower
and its Subsidiaries during such period pursuant to Sections 7.08(a), (b), (e),
(f), (g) and (h) (other than any such Capital Expenditures to the extent
financed with equity proceeds or Indebtedness (other than with loans incurred
under the Working Capital Facility), (ii) the aggregate amount of permanent
principal payments of Indebtedness for borrowed money of the Borrower and its
Subsidiaries during such period (other than repayments of Loans, provided that
repayments of Loans shall be deducted in determining Excess Cash Flow if such
repayments were (x) required as a result of a Scheduled Repayment under Section
3.02(a) or (y) made as a voluntary prepayment with internally generated funds),
(iii) the aggregate amount of cash contributions made by the Borrower to its
pension plans during such period (except to the extent financed with equity
proceeds) and (iv) the aggregate amount of cash Investments made pursuant to
Sections 7.05(xii), (xiii) and (xv) during such period (except to the extent
financed with equity proceeds or Indebtedness (other than with loans incurred
under the Working Capital Facility).
"Excess Cash Payment Date" shall mean the date occurring on the earlier of (x)
120 days after the last day of each fiscal year of the Borrower and (y) the
date of delivery of the financial statements pursuant to Section 6.01(b) in
respect of the relevant Excess Cash Payment Period (in either case, beginning
with the Borrower's fiscal year ending closest to December 31, 1999).
"Excess Cash Payment Period" shall mean, with respect to the repayment required
on each Excess Cash Payment Date, the immediately preceding fiscal year of the
Borrower.
"Existing Indebtedness" shall have the meaning provided in Section 5.22.
"Existing Indebtedness Agreements" shall have the meaning provided in Section
4.06.
"Existing Senior Secured Note Documents" shall mean the Existing 13-1/2% Senior
Secured Discount Note Documents and the Existing 12-1/2% Senior Secured Note
Documents.
"Existing Senior Secured Note Indenture Supplements" shall mean each of the
Existing 12-1/2% Senior Secured Note Indenture Supplement and the Existing
13-1/2% Senior Secured Discount Note Indenture Supplement.
"Existing Senior Secured Note Indentures" shall mean each of the Existing
12-1/2% Senior Secured Note Indenture and the Existing 13-1/2% Senior Secured
Discount Note Indenture.
"Existing Senior Secured Note Indenture Trustee" shall mean State Street Bank
and Trust Company.
"Existing Senior Secured Notes" shall mean each of the Existing 12-1/2% Senior
Secured Notes and the 13-1/2% Senior Secured Discount Notes.
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"Existing Senior Secured Notes Consent" shall mean (i) each written consent
permitting the Borrower to enter into the Existing 13-1/2% Senior Secured
Discount Note Indenture Supplement from a holder of one or more Existing
13-1/2% Senior Secured Discount Notes outstanding on the record date for
determining those holders entitled to consent to such Existing 13-1/2% Senior
Secured Discount Note Indenture Supplement and (ii) each written consent
permitting the Borrower to enter into the Existing 12-1/2% Senior Secured Note
Indenture Supplement from a holder of one or more Existing 12-1/2% Senior
Secured Notes outstanding on the record date for determining those holders
entitled to consent to such Existing 12-1/2% Senior Secured Note Indenture
Supplement.
"Existing Senior Secured Notes Consent Solicitation" shall mean the
solicitation of Existing Senior Secured Notes Consents to amend the Existing
13-1/2% Senior Secured Discount Note Indenture and the Existing 12-1/2% Senior
Secured Note Indenture performed by or on behalf of the Borrower in connection
with the Existing Senior Secured Notes Tender Offer.
"Existing Senior Secured Notes Consent Solicitation Documents" shall mean each
of the documents distributed to holders of the Existing 13-1/2% Senior Secured
Discount Notes and the Existing 12-1/2% Senior Secured Notes or otherwise
entered into by the Borrower or any of such holders in connection with the
consummation of the Existing Senior Secured Notes Consent Solicitation,
including, without limitation, the Existing Senior Secured Notes Consents and
the Existing Senior Secured Notes Indenture Supplements.
"Existing Senior Secured Notes Tender Offer" shall mean (i) the offer by the
Borrower to purchase for cash any and all of the Existing 13-1/2% Senior
Secured Discount Notes and the Existing 12-1/2% Senior Secured Notes, the
foregoing to be effected pursuant to the Existing Senior Secured Notes Tender
Offer Documents.
"Existing Senior Secured Notes Tender Offer Documents" shall mean the offer to
purchase distributed by the Borrower in connection with the Existing Senior
Secured Notes Tender Offer, and all amendments and exhibits thereto, and all
documents related to any of the foregoing distributed to the holders or
representatives of the Existing Senior Secured Notes in connection with the
Existing Senior Secured Notes Tender Offer.
"Existing Term Loan Agreement" shall mean the Term Loan Agreement, dated as of
August 4, 1994, among the Borrower, the lenders party thereto and Xxxxxx Trust
and Savings Bank, as agent, as in effect on the Effective Date.
"Existing 13-1/2% Senior Secured Discount Note Documents" shall mean and
include each of the documents and other agreements (including, without
limitation, the Existing 13-1/2% Senior Secured Discount Note Indenture and the
Existing 13-1/2% Senior Secured Discount Note Indenture Supplement) governing
or evidencing the Existing 13-1/2% Senior Secured Discount Notes, as in effect
on the Effective Date and as the same may be amended, modified or supplemented
from time to time pursuant to the terms hereof and thereof.
"Existing 13-1/2% Senior Secured Discount Note Indenture" shall mean the
Indenture, dated as of August 11, 1994, among the Borrower, the Subsidiaries of
the Borrower party thereto and the Existing Senior Secured Note Indenture
Trustee, as in effect on the Effective Date and as the same may be amended,
modified or supplemented from time to time pursuant to the terms hereof and
thereof.
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"Existing 13-1/2% Senior Secured Discount Note Indenture Supplement" shall mean
the Supplemental Indenture to the Existing 13-1/2% Senior Secured Discount Note
Indenture in the form delivered to the Administrative Agent pursuant to Section
4.08 and entered into by the Borrower, the Subsidiaries of the Borrower party
thereto and the Existing Senior Secured Note Trustee in connection with the
Existing Senior Secured Notes Consent Solicitation.
"Existing 13-1/2% Senior Secured Discount Notes" shall mean the $117,958,000
aggregate principal amount of the Borrower's 13-1/2% Senior Secured Discount
Notes due 2004, which were issued pursuant to the Existing 13-1/2% Senior
Secured Discount Note Indenture.
"Existing 12-1/2% Senior Secured Note Documents" shall mean and include each of
the documents and other agreements (including, without limitation, the Existing
12-1/2% Senior Secured Note Indenture and the Existing 12-1/2% Senior Secured
Note Indenture Supplement) governing or evidencing the Existing 12-1/2% Senior
Secured Notes, as in effect on the Effective Date and as the same may be
amended, modified or supplemented from time to time pursuant to the terms
hereof and thereof.
"Existing 12-1/2% Senior Secured Note Indenture" shall mean the Indenture,
dated as of August 11, 1994, among the Borrower, the Subsidiaries of the
Borrower party thereto and the Existing Senior Secured Note Indenture Trustee,
as in effect on the Effective Date and as the same may be amended, modified or
supplemented from time to time pursuant to the terms hereof and thereof.
"Existing 12-1/2% Senior Secured Note Indenture Supplement" shall mean the
Supplemental Indenture to the Existing 12- 1/2% Senior Secured Note Indenture
in the form delivered to the Administrative Agent pursuant to Section 4.08 and
entered into by the Borrower, the Subsidiaries of the Borrower party thereto
and the Existing Senior Secured Note Trustee in connection with the Existing
12-1/2% Senior Secured Note Consent Solicitation.
"Existing 12-1/2% Senior Secured Notes" shall mean the $125,000,000 aggregate
principal amount of the Borrower's 12-1/2% Senior Secured Notes due 2002, which
were issued pursuant to the Existing 12-1/2% Senior Secured Note Indenture.
"Federal Funds Rate" shall mean, for any period, a fluctuating interest rate
equal for each day during such period to the weighted average of the rates on
overnight Federal Funds transactions with members of the Federal Reserve System
arranged by Federal Funds brokers, as published for such day (or, if such day
is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day
which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or referred to in Section
2.01.
"GAAP" shall mean generally accepted accounting principles as in effect from
time to time, applied by the Borrower and its Subsidiaries on a basis
consistent with the preparation of the Borrower's most recent financial
statements furnished to the Lenders pursuant to Section 5.05.
"Granting Credit Party" shall mean Acme Steel and any other Subsidiary of the
Borrower that is engaged principally in the steel making (as opposed to the
steel fabricating) business of the Borrower.
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"Hazardous Materials" shall mean (a) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is friable, urea formaldehyde
foam insulation, transformers or other equipment that contain dielectric fluid
containing levels of polychlorinated biphenyls, and radon gas; (b) any
chemicals, materials or substances defined as or included in the definition of
"hazardous substances," "hazardous waste," "hazardous materials," "extremely
hazardous substances," "restricted hazardous waste," "toxic substances," "toxic
pollutants," "contaminants," or "pollutants," or words of similar import, under
any applicable Environmental Law; and (c) any other chemical, material or
substance, the Release of which is prohibited, limited or regulated by any
governmental authority.
"Indebtedness" shall mean, as to any Person, without duplication, (i) all
indebtedness of such Person for borrowed money, (ii) all obligations of such
Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all indebtedness of such Person for the deferred purchase price of
property or services, which purchase price (other than in respect of any
Permitted Acquisition or any Investment made pursuant to Section 7.05(xv)) is
due more than six months after the date of placing such property in service or
taking delivery and title thereto or the completion of such services, (iv) all
Indebtedness of the types described in clause (i), (ii), (iii), (v), (vi) (vii)
or (viii) of this definition secured by any Lien on any property owned by such
Person, whether or not such Indebtedness has been assumed by such Person
(provided, that, if the Person has not assumed or otherwise become liable in
respect of such Indebtedness, such Indebtedness shall be deemed to be in an
amount equal to the fair market value of the property to which such Lien
relates as determined in good faith by such Person), (v) the aggregate amount
required to be capitalized under leases under which such Person is the lessee,
(vi) all obligations of such person to pay a specified purchase price for goods
or services, whether or not delivered or accepted, i.e., take-or-pay and
similar obligations, but excluding those take-or-pay and similar obligations of
the type described in Schedule 9.01, (vii) all Contingent Obligations of such
Person and (viii) all obligations under any Interest Rate Protection Agreement,
any Other Hedging Agreement or under any similar type of agreement.
Notwithstanding the foregoing, Indebtedness shall not include (x) trade
payables and accrued expenses incurred by any Person in accordance with
customary practices and in the ordinary course of business of such Person and
(y) up to $6,000,000 of existing deferred payments in the aggregate still
required to be made to Raytheon Engineers and Constructors, Inc. and SMS
Xxxxxxxxxx-Siemag AG as part of Acme Steel's prior modernization of its steel
plant.
"Interest Determination Date" shall mean, with respect to any Eurodollar Loan,
the second Business Day prior to the commencement of any Interest Period
relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest
rate hedging agreement or other similar agreement or arrangement.
"Interlake Cross-Indemnification Agreement" shall mean the Cross
Indemnification Agreement, dated as of May 29, 1986, between Acme Steel and The
Interlake Corporation.
"Interlake Tax Indemnity Agreement" shall mean the Tax Indemnification
Agreement, dated as of May 30, 1986, between Acme Steel and The Interlake
Corporation
"Investments" shall have the meaning provided in Section 7.05.
"Leaseholds" of any Person shall mean all the right, title and interest of such
Person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
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"Lender" shall mean each financial institution listed on Schedule 1.01(a), as
well as any Person which becomes a "Lender" hereunder pursuant to Section 1.13
or 11.04(b).
"Leverage Ratio" shall mean, at any time, the ratio of Consolidated
Indebtedness at such time to Consolidated EBITDA for the Test Period then most
recently ended.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the UCC or any other
similar recording or notice statute, and any lease having substantially the
same effect as any of the foregoing).
"Loan" shall have the meaning provided in Section 1.01.
"Margin Stock" shall have the meaning provided in Regulation U.
"Maturity Date" shall mean December 1, 2005.
"Minimum Borrowing Amount" shall mean (i) for Base Rate Loans, $1,000,000 and
(ii) for Eurodollar Loans, $5,000,000.
"Mortgage" shall mean each mortgage, deed to secure debt or deed of trust
pursuant to which any Granting Credit Party or the Borrower shall have granted
to the Collateral Agent a mortgage lien on such Credit Party's Mortgaged
Property.
"Mortgage Policy" shall have the meaning provided in Section 4.16.
"Mortgaged Property" shall mean each parcel of Real Property owned or leased by
any Granting Credit Party or the Borrower, as applicable, which is encumbered
by a Mortgage.
"MSSF" shall mean Xxxxxx Xxxxxxx Senior Funding, Inc., in its individual
capacity, and any successor corporation thereto, by merger, consolidation or
otherwise.
"NACME" shall mean NACME Steel Processing, L.L.C., a Delaware limited liability
company of which the Borrower is a member, which is engaged in the business of
pickling, oiling and slitting steel.
"NAIC" shall mean the National Association of Insurance Commissioners.
"Net Debt Proceeds" shall mean, with respect to any incurrence of Indebtedness
for borrowed money, the cash proceeds (net of underwriting discounts and
commissions and other reasonable costs associated therewith) received by the
respective Person from the respective incurrence of such Indebtedness for
borrowed money.
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"Net Equity Proceeds" shall mean, with respect to each issuance or sale of any
equity by any Person or any capital contribution to such Person, the cash
proceeds (net of underwriting discounts and commissions and other reasonable
costs associated therewith) received by such Person from the respective sale or
issuance of its equity or from the respective capital contribution.
"Net Insurance Proceeds" shall mean, with respect to any Recovery Event, the
cash proceeds (net of reasonable costs and taxes incurred in connection with
such Recovery Event and the required payments of any Indebtedness permitted
under this Agreement (other than Indebtedness secured pursuant to the Security
Documents) which is secured by the respective assets subject to such Recovery
Event) received by the respective Person in connection with the respective
Recovery Event.
"Net Sale Proceeds" shall mean, for any Asset Sale, the gross cash proceeds
(including any cash received by way of deferred payment pursuant to a
promissory note, receivable or otherwise, but only as and when received)
received from such sale of assets, net of the reasonable costs of such sale
(including fees and commissions, payments of unassumed liabilities relating to
the assets sold and required payments of any Indebtedness (other than
Indebtedness secured pursuant to the Security Documents) which is secured by
the respective assets which were sold), and the incremental taxes paid or
payable as a result of such Asset Sale.
"New Senior Note Documents" shall mean the New Senior Note Indenture, the New
Senior Notes and each other document or agreement relating to the issuance of
the New Senior Notes.
"New Senior Note Indenture" shall mean the Indenture dated as of December 18,
1997 among the Borrower, Acme Steel and Xxxxxx Trust and Savings Bank, as
trustee.
"New Senior Note Offering Memorandum" shall mean the Offering Memorandum, dated
as of December 18, 1997, relating to the Borrower's issuance of the New Senior
Notes.
"New Senior Notes" shall mean the Borrower's 10-7/8% New Senior Note due 2007.
"Note" shall have the meaning provided in Section 1.05.
"Notice of Borrowing" shall have the meaning provided in Section 1.03.
"Notice of Conversion" shall have the meaning provided in Section 1.06.
"Notice Office" shall mean the office of the Administrative Agent located at
000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx XxXxxxx or such
other office as the Administrative Agent may hereafter designate in writing as
such to the other parties hereto.
"Obligations" shall mean all amounts owing to the Administrative Agent, the
Collateral Agent or any Lender pursuant to the terms of this Agreement or any
other Credit Document.
"Other Hedging Agreement" shall mean any foreign exchange contracts, currency
swap agreements, commodity agreements or other similar agreements or
arrangements designed to protect against the fluctuations in currency values or
commodity prices.
"Parallel Loan" shall mean that item of Existing Indebtedness of the Borrower
identified as such on Schedule 5.22.
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"Payment Office" shall mean the office of the Administrative Agent located at
000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other office as the
Administrative Agent may hereafter designate in writing as such to the other
parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established pursuant
to Section 4002 of ERISA, or any successor thereto.
"Permitted Acquisition" shall have the meaning provided in Section 7.02(xiii).
"Permitted Encumbrance" shall mean, with respect to any Mortgaged Property, (i)
the mortgage and other security documents securing the Existing Senior Secured
Notes described in the Collateral Agency Agreement and (ii) such other
exceptions to title as are set forth in the Mortgage Policy delivered with
respect thereto, all of which other exceptions must be acceptable to the Agents
in their reasonable discretion.
"Permitted Liens" shall have the meaning provided in Section 7.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, limited liability company, trust or other enterprise
or any government or political subdivision or any agency, department or
instrumentality thereof.
"Phase II Expansion" shall mean an expansion of the Borrower's facilities in
Riverdale, Illinois to more fully utilize the capacity of the Borrower's
existing hot mill, which expansion may involve the addition of an electric arc
furnace, a second caster, a second tunnel furnace and related machinery and
equipment.
"Plan" shall mean any pension plan as defined in Section 3(2) of ERISA, which
is maintained or contributed to by (or to which there is an obligation to
contribute of) the Borrower or a Subsidiary of the Borrower or an ERISA
Affiliate, and each such plan for the five year period immediately following
the latest date on which the Borrower, or a Subsidiary of the Borrower or an
ERISA Affiliate maintained, contributed to or had an obligation to contribute
to such plan.
"Pledge Agreement" shall have the meaning provided in Section 4.13.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined in the
Pledge Agreement.
"Pledged Stock" shall mean all "Pledged Stock" as defined in the Pledge
Agreement.
"Prime Lending Rate" shall mean the rate which the Administrative Agent
announces from time to time as its prime lending rate, the Prime Lending Rate
to change when and as such prime lending rate changes. The Prime Lending Rate
is a reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. The Administrative Agent may make commercial
loans or other loans at rates of interest at, above or below the Prime Lending
Rate.
"Projections" shall mean the projections prepared by the Borrower, dated
November, 1997, and furnished to the Lenders prior to the Effective Date.
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"Qualified Preferred Stock" shall mean any preferred stock of the Borrower so
long as the terms of any such preferred stock (i) do not contain any mandatory
put, redemption, repayment, sinking fund or other similar provision occurring
before December 31, 2006, (ii) do not require the cash payment of dividends,
(iii) do not contain any covenants, (iv) do not grant the holders thereof any
voting rights except for (x) voting rights required to be granted to such
holders under applicable law, (y) voting rights contemplated by the Rights
Agreement and (z) limited customary voting rights on fundamental matters such
as mergers, consolidations, sales of all or substantially all of the assets of
the Borrower, or liquidations involving the Borrower, and (v) are otherwise
reasonably satisfactory to the Agents.
"Quarterly Payment Date" shall mean each March 1, June 1, September 1 and
December 1 occurring after the Effective Date.
"RCRA" shall mean the Resource Conservation and Recovery Act, as the same may
be amended from time to time, 42 U.S.C. Section 6901 et seq.
"Real Property" of any Person shall mean all the right, title and interest of
such Person in and to land, improvements and fixtures, including Leaseholds.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation awards payable (i)
by reason of theft, loss, physical destruction, damage, taking or any other
similar event with respect to any property or assets of the Borrower or any of
its Subsidiaries and (ii) under any policy of insurance required to be
maintained under Section 6.03.
"Register" shall have the meaning provided in Section 11.15.
"Regulation D" shall mean Regulation D of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof establishing reserve requirements.
"Regulation G" shall mean Regulation G of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
"Regulation T" shall mean Regulation T of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of the Federal
Reserve System as from time to time in effect and any successor to all or a
portion thereof.
"Release" shall mean the disposing, discharging, injecting, spilling, pumping,
leaking, leaching, dumping, emitting, escaping, emptying, pouring or migrating,
into or upon any land or water or air, or otherwise entering into the
environment.
"Replaced Lender" shall have the meaning provided in Section 1.13.
"Replacement Lender" shall have the meaning provided in Section 1.13.
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"Reportable Event" shall mean an event described in Section 4043(c) of ERISA
with respect to a Plan that is subject to Title IV of ERISA other than those
events as to which the 30-day notice period is waived under subsection .22,
.23, .25, .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Regulation Section
4043.
"Required Lenders" shall mean Lenders the sum of whose outstanding Loans
represent an amount greater than 50% of all outstanding Loans of all Lenders.
"Restricted Collateral Account" shall mean, with respect to any Asset Sale or
Recovery Event, an account of the Borrower and/or any Subsidiary of the
Borrower maintained with the Administrative Agent into which shall be deposited
the Net Sale Proceeds or the Net Insurance Proceeds, as the case may be, with
respect to such Asset Sale or Recovery Event (with such amount so deposited to
be held in cash or invested in Cash Equivalents, at the election of the
Borrower), provided that no amount may be withdrawn from such Restricted
Collateral Account except as follows: (i) on each date after the occurrence of
such Asset Sale or Recovery Event, as the case may be, and prior to the 360th
day after the receipt of the proceeds from such Asset Sale or Recovery Event,
as the case may be, with respect thereto on which the Borrower delivers to the
Administrative Agent a certificate signed by the President, the Chief Financial
Officer or the Treasurer of the Borrower stating that all or a specified
portion of the Net Sale Proceeds or Net Insurance Proceeds relating to such
Asset Sale or Recovery Event, as the case may be, has been, or
contemporaneously with the delivery of such certificate is being, reinvested by
the Borrower or such Subsidiary in assets as permitted by Section 3.02(d) or
3.02(f), as the case may be, an amount equal to the amount so reinvested or
being reinvested may be withdrawn, (ii) to repay outstanding Loans as required
by Section 3.02(d) or 3.02(f), as the case may be; and (iii) to repay
outstanding Loans in the event that the Borrower or such Subsidiary elects not
to use all or any portion of such proceeds for reinvestment purposes (it being
understood that all such amounts on deposit in the Restricted Collateral
Account are subject to being withdrawn by the Administrative Agent and applied
toward the Obligations at any time that an Event of Default exists and is
continuing).
"Rights Agreement" shall mean the Preferred Share Rights Purchase Agreement,
dated as of July 15, 1994, between the Borrower and First Chicago Trust Company
of New York, as rights agent.
"Scheduled Repayments" shall have the meaning provided in Section 3.02(a).
"SEC" shall have the meaning provided in Section 6.01(f).
"Section 3.04(b)(ii) Certificate" shall have the meaning provided in Section
3.04(b)(ii).
"Secured Creditors" shall have the meaning assigned that term in the respective
Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 4.14.
"Security Agreement Collateral" shall mean all "Collateral" as defined in the
Security Agreement.
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"Security Document" shall mean and include each of the Security Agreement, the
Pledge Agreement, the Collateral Agency Agreement, each Mortgage, and, after
the execution and delivery thereof, each Additional Security Document.
"Start Date" shall mean, with respect to any Applicable Margin Period, the
first day of such Applicable Margin Period.
"Subordinated Note Documents" shall mean the Subordinated Notes, any indenture
or purchase agreement related thereto and each of the other documents entered
into in connection therewith.
"Subordinated Notes" shall have the meaning provided in Section 7.04(xii)
"Subsidiaries Guaranty" shall have the meaning provided in Section 4.15.
"Subsidiary" shall mean, as to any Person, (i) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary voting
power to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person and/or one or more
Subsidiaries of such Person and (ii) any partnership, limited liability
company, association, joint venture or other entity in which such Person and/or
one or more Subsidiaries of such Person has more than a 50% equity interest at
the time.
"Subsidiary Guarantor" shall mean each Subsidiary of the Borrower.
"Syndication Agent" shall mean MSSF, in its capacity as Syndication Agent and
Arranger for the Lenders hereunder.
"Syndication Date" shall mean that date upon which the Syndication Agent
determines (and notifies the Borrower) that the primary syndication (and
resultant addition of Persons as Lenders pursuant to Section 11.04(b)) has been
completed.
"Tax Sharing Agreements" shall have the meaning provided in Section 4.06.
"Taxes" shall have the meaning provided in Section 3.04(a).
"Test Date" shall mean, with respect to any Start Date, the last day of the
most recent fiscal quarter of the Borrower ended immediately prior to such
Start Date.
"Test Period" shall mean (i) for any determination made on or prior to the last
day of the fiscal quarter of the Borrower ending closest to September 30, 1998,
the period from January 1, 1998 through and including the last day of the
fiscal quarter of the Borrower then last ended (in each case taken as one
accounting period) and (ii) for any determination made thereafter, each period
of four consecutive fiscal quarters of the Borrower then last ended (in each
case taken as one accounting period).
"Total Commitment" shall mean, at any time, the sum of the Commitments of each
of the Lenders.
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"Transaction" shall mean, collectively, (i) the consummation of the Existing
Senior Secured Notes Tender Offer, (ii) the issuance of the New Senior Notes,
(iii) the consummation of the Existing Senior Secured Notes Consent
Solicitation, (iv) the consummation of the Bank Refinancing, (v) the amendment
and restatement of the Working Capital Facility and repayment of outstanding
loans thereunder on the Effective Date, (vi) the entering into of the Credit
Documents and the incurrence of all Loans on the Effective Date and (vii) the
payment of fees and expenses in connection with the foregoing.
"Type" shall mean the type of Loan determined with regard to the interest
option applicable thereto, i.e., whether a Base Rate Loan or a Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in effect in
the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the amount, if any, by
which the actuarial present value of the accumulated plan benefits under the
Plan as of the close of its most recent plan year, determined in accordance
with actuarial assumptions at such time consistent with Statement of Financial
Accounting Standards No. 87, exceeds the market value of the assets allocable
thereto.
"United States" and "U.S." shall each mean the United States of America.
"Universal Tool and Stamping" shall mean Universal Tool & Stamping Company,
Inc., an Indiana corporation.
"Wabush" shall mean the entity called Wabush Mines, a Canadian joint venture,
including Wabush Iron Co. Ltd., an Ohio corporation and one of the joint
venturers of Wabush Mines, which is engaged in the mining, beneficiation and
pelletizing of iron ore or any successor to either such entity, any entity of
approximately equivalent value substituted therefor or any investment of
approximately equivalent value and purpose.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any corporation
100% of whose capital stock (other than director's qualifying shares) is at the
time owned by such Person and/or one or more Wholly-Owned Subsidiaries of such
Person and (ii) any partnership, limited liability company, association, joint
venture or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
"Working Capital Facility" shall mean the Amended and Restated Credit
Agreement, dated as of August 11, 1994, and amended and restated as of December
18, 1997, by and among the Borrower, the Subsidiary Guarantors party thereto,
the lenders from time to time party thereto and Xxxxxx Trust and Savings Bank,
as Agent (including any related security documents and guaranties), as the same
may be amended, supplemented, refinanced or replaced from time to time to the
extent permitted by Section 7.13.
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SECTION 10. The Administrative Agent and the Syndication Agent.
10.01 Appointment.
(a) The Lenders hereby irrevocably designate BTCo as
Administrative Agent (for purposes of this Section 10, the
term "Administrative Agent" also shall include BTCo in its
capacity as Collateral Agent pursuant to the Security
Documents) to act as specified herein and in the other Credit
Documents. The Lenders hereby designate MSSF as Syndication
Agent (for the purposes of this Section 10, the term
"Syndication Agent" also shall mean MSSF in its capacity as
Arranger) to act as specified herein and in the other Credit
Documents. Each Lender hereby irrevocably authorizes, and
each holder of any Note by the acceptance of such Note shall
be deemed irrevocably to authorize, the Administrative Agent
and the Syndication Agent to take such action on its behalf
under the provisions of this Agreement, the other Credit
Documents and any other instruments and agreements referred to
herein or therein and to exercise such powers and to perform
such duties hereunder and thereunder as are specifically
delegated to or required of the Administrative Agent and the
Syndication Agent by the terms hereof and thereof and such
other powers as are reasonably incidental thereto. The
Administrative Agent and the Syndication Agent may perform any
of their duties hereunder by or through its officers,
directors, agents, employees or affiliates.
(b) The Lenders also hereby designate State Street Bank and Trust
Company as a general collateral agent for such Lenders to act
as specified in the Collateral Agency Agreement until the same
is terminated in accordance with its terms. Each Lender
hereby authorizes, and each holder of any Note by the
acceptance of such Note shall be deemed to authorize, State
Street Bank and Trust Company to take such action on its
behalf under the provisions of the Collateral Agency Agreement
and any other instruments and agreements referred to therein
and to exercise such powers and to perform such duties
thereunder as are specifically delegated to State Street Bank
and Trust Company by the terms thereof and such other powers
as are reasonably incidental thereto. Each Lender also agrees
to be bound by the provisions of the Collateral Agency
Agreement and the Intercreditor Agreement.
10.02 Nature of Duties. Neither the Administrative Agent nor the Syndication
Agent shall have any duties or responsibilities except those expressly set
forth in this Agreement and in the other Credit Documents. Neither the
Administrative Agent, the Syndication Agent nor any of their officers,
directors, agents, employees or affiliates shall be liable for any action taken
or omitted by them hereunder or under any other Credit Document or in
connection herewith or therewith, unless caused by its or their gross
negligence or willful misconduct. The duties of the Administrative Agent and
the Syndication Agent shall be mechanical and administrative in nature; neither
the Administrative Agent nor the Syndication Agent shall have by reason of this
Agreement or any other Credit Document a fiduciary relationship in respect of
any Lender or the holder of any Note; and nothing in this Agreement or any
other Credit Document, expressed or implied, is intended to or shall be so
construed as to impose upon the Administrative Agent or the Syndication Agent
any obligations in respect of this Agreement or any other Credit Document
except as expressly set forth herein or therein.
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10.03 Lack of Reliance on the Administrative Agent and the Syndication Agent.
Independently and without reliance upon the Administrative Agent or the
Syndication Agent, each Lender and the holder of each Note, to the extent it
deems appropriate, has made and shall continue to make (i) its own independent
investigation of the financial condition and affairs of the Borrower and its
Subsidiaries in connection with the making and the continuance of the Loans and
the taking or not taking of any action in connection herewith and (ii) its own
appraisal of the creditworthiness of the Borrower and its Subsidiaries and,
except as expressly provided in this Agreement, neither the Administrative
Agent nor the Syndication Agent shall have any duty or responsibility, either
initially or on a continuing basis, to provide any Lender or the holder of any
Note with any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or times
thereafter. Neither the Administrative Agent nor the Syndication Agent shall
be responsible to any Lender or the holder of any Note for any recitals,
statements, information, representations or warranties herein or in any
document, certificate or other writing delivered in connection herewith or for
the execution, effectiveness, genuineness, validity, enforceability,
perfection, collectability, priority or sufficiency of this Agreement or any
other Credit Document or the financial condition of the Borrower or any of its
Subsidiaries or be required to make any inquiry concerning either the
performance or observance of any of the terms, provisions or conditions of this
Agreement or any other Credit Document, or the financial condition of the
Borrower or any of its Subsidiaries or the existence or possible existence of
any Default or Event of Default.
10.04 Certain Rights of the Agents. If any Agent shall request instructions
from the Required Lenders with respect to any act or action (including failure
to act) in connection with this Agreement or any other Credit Document, such
Agent shall be entitled to refrain from such act or taking such action unless
and until such Agent shall have received instructions from the Required
Lenders; and such Agent shall not incur liability to any Lender by reason of so
refraining. Without limiting the foregoing, no Lender or the holder of any
Note shall have any right of action whatsoever against any Agent as a result of
such Agent acting or refraining from acting hereunder or under any other Credit
Document in accordance with the instructions of the Required Lenders.
10.05 Reliance. The Administrative Agent and the Syndication Agent shall be
entitled to rely, and shall be fully protected in relying, upon any note,
writing, resolution, notice, statement, certificate, telex, teletype or
telecopier message, cablegram, radiogram, order or other document or telephone
message signed, sent or made by any Person that the Administrative Agent or the
Syndication Agent believed to be the proper Person, and, with respect to all
legal matters pertaining to this Agreement and any other Credit Document and
its duties hereunder and thereunder, upon advice of counsel selected by the
Administrative Agent or the Syndication Agent, as the case may be.
10.06 Indemnification. To the extent the Administrative Agent or the
Syndication Agent is not reimbursed and indemnified by the Credit Parties, the
Lenders will reimburse and indemnify the Administrative Agent and the
Syndication Agent in proportion to their respective "percentage" as used in
determining the Required Lenders (determined as if there were no Defaulting
Banks) for and against any and all liabilities, obligations, losses, damages,
penalties, claims, actions, judgments, costs, expenses or disbursements of
whatsoever kind or nature which may be imposed on, asserted against or incurred
by the Administrative Agent or the Syndication Agent in performing its duties
hereunder or under any other Credit Document or in any way relating to or
arising out of this Agreement or any other Credit Document; provided that no
Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements to the extent resulting from the Administrative Agent's or the
Syndication Agent's gross negligence or willful misconduct.
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10.07 The Administrative Agent and the Syndication Agent in their Individual
Capacity. With respect to its obligation to make Loans under this Agreement,
the Administrative Agent and the Syndication Agent shall have the rights and
powers specified herein for a "Lender" and may exercise the same rights and
powers as though it were not performing the duties specified herein; and the
term "Lenders," "Required Lenders," "holders of Notes" or any similar terms
shall, unless the context clearly otherwise indicates, include the
Administrative Agent and the Syndication Agent in their respective individual
capacities. The Administrative Agent and the Syndication and their affiliates
may accept deposits from, lend money to, and generally engage in any kind of
banking, investment banking, trust or other business with, or provide debt
financing, equity capital or other services (including financial advisory
services) to, any Credit Party or any Affiliate of any Credit Party (or any
Person engaged in a similar business with any Credit Party or any Affiliate
thereof) as if they were not performing the duties specified herein, and may
accept fees and other consideration from any Credit Party or any Affiliate of
any Credit Party for services in connection with this Agreement and otherwise
without having to account for the same to the Lenders.
10.08 Holders. Any Agent may deem and treat the payee of any Note as the
owner thereof for all purposes hereof unless and until a written notice of the
assignment, transfer or endorsement thereof, as the case may be, shall have
been filed with the Administrative Agent. Any request, authority or consent of
any Person who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee, assignee or endorsee, as the case may be, of
such Note or of any Note or Notes issued in exchange therefor.
10.09 Resignation by the Administrative Agent and the Syndication Agent.
(a) The Administrative Agent and/or the Syndication Agent may
resign from the performance of all its respective functions
and duties hereunder and/or under the other Credit Documents
at any time by giving 15 Business Days' prior written notice
to the Lenders. Such resignation, in the case of the
Administrative Agent, shall take effect upon the appointment
of a successor Administrative Agent pursuant to clauses (b)
and (c) below or as otherwise provided below, and such
resignation, in the case of the Syndication Agent, shall take
effect immediately.
(b) Upon any such notice of resignation by the Administrative
Agent, the Required Lenders shall appoint a successor
Administrative Agent hereunder or thereunder who shall be a
commercial bank or trust company reasonably acceptable to the
Borrower.
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the
Administrative Agent with the consent of the Borrower (which
consent shall not be unreasonably withheld or delayed), shall
then appoint a successor Administrative Agent who shall serve
as Administrative Agent hereunder or thereunder until such
time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed
pursuant to clause (b) or (c) above by the 20th Business Day
after the date such notice of resignation was given by the
Administrative Agent, the Administrative Agent's resignation
shall become effective and the Required Lenders shall
thereafter perform all the duties of the Administrative Agent
hereunder and/or under any other Credit Document until such
time, if any, as the Required Lenders appoint a successor
Administrative Agent as provided above.
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SECTION 11. Miscellaneous.
11.01 Payment of Expenses, etc. The Borrower shall: (i) whether or not the
transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Agents (including, without limitation,
the reasonable fees and disbursements of White & Case and of the Agents' local
counsel and consultants) in connection with the preparation, execution and
delivery of this Agreement and the other Credit Documents and the documents and
instruments referred to herein and therein and any amendment, waiver or consent
relating hereto or thereto, of the Agents in connection with their syndication
efforts with respect to this Agreement and of the Agents and, after the
occurrence of an Event of Default, each of the Lenders in connection with the
enforcement of this Agreement and the other Credit Documents and the documents
and instruments referred to herein and therein or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a "work-out" or pursuant to any insolvency or
bankruptcy proceedings (including, without limitation, in each case the
reasonable fees and disbursements of counsel for each of the Agents and, after
the occurrence of an Event of Default, for each of the Lenders); (ii) pay and
hold each of the Lenders harmless from and against any and all present and
future stamp, excise and other similar documentary taxes with respect to the
foregoing matters and save each of the Lenders harmless from and against any
and all liabilities with respect to or resulting from any delay or omission
(other than to the extent attributable to such Lenders) to pay such taxes; and
(iii) indemnify each Agent and each Lender, and each of their respective
officers, directors, employees, representatives and agents from and hold each
of them harmless against any and all liabilities, obligations (including
removal or remedial actions), losses, damages, penalties, claims, actions,
judgments, suits, costs, expenses and disbursements (including reasonable
attorneys' and consultants' fees and disbursements) incurred by, imposed on or
assessed against any of them as a result of, or arising out of, or in any way
related to, or by reason of, (a) any investigation, litigation or other
proceeding (whether or not the any Agent or any Lender is a party thereto and
whether or not such investigation, litigation or other proceeding is brought by
or on behalf of any Credit Party) related to the entering into and/or
performance of this Agreement or any other Credit Document or the proceeds of
any Loans hereunder or the consummation of the Transaction or any other
transactions contemplated herein or in any other Credit Document or the
exercise of any of their rights or remedies provided herein or in the other
Credit Documents, or (b) the actual or alleged presence of Hazardous Materials
in the air, surface water or groundwater or on the surface or subsurface of any
Real Property owned or at any time operated by the Borrower or any of its
Subsidiaries, the generation, storage, transportation, handling or disposal of
Hazardous Materials by the Borrower or any of its Subsidiaries at any location,
whether or not owned or operated by the Borrower or any of its Subsidiaries,
the non-compliance of any Real Property with foreign, federal, state and local
laws, regulations, and ordinances (including applicable permits thereunder)
applicable to any Real Property, or any Environmental Claim asserted against
the Borrower, any of its Subsidiaries or any Real Property owned or at any time
operated by the Borrower or any of its Subsidiaries, including, in each case,
without limitation, the reasonable fees and disbursements of counsel and other
consultants incurred in connection with any such investigation, litigation or
other proceeding (but excluding any losses, liabilities, claims, damages or
expenses to the extent incurred by reason of the gross negligence or willful
misconduct of the Person to be indemnified). To the extent that the
undertaking to indemnify, pay or hold harmless any Agent or any Lender set
forth in the preceding sentence may be unenforceable because it is violative of
any law or public policy, the Borrower shall make the maximum contribution to
the payment and satisfaction of each of the indemnified liabilities which is
permissible under applicable law.
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11.02 Right of Setoff. In addition to any rights now or hereafter granted
under applicable law or otherwise, and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default,
each Lender is hereby authorized at any time or from time to time, without
presentment, demand, protest or other notice of any kind to any Credit Party or
to any other Person, any such notice being hereby expressly waived, to set off
and to appropriate and apply any and all deposits (general or special) and any
other Indebtedness at any time held or owing by such Lender (including, without
limitation, by branches and agencies of such Lender wherever located) to or for
the credit or the account of any Credit Party against and on account of the
Obligations and liabilities of the Credit Parties to such Lender under this
Agreement or under any of the other Credit Documents, including, without
limitation, all interests in Obligations purchased by such Lender pursuant to
Section 11.06(b), and all other claims of any nature or description arising out
of or connected with this Agreement or any other Credit Document, irrespective
of whether or not such Lender shall have made any demand hereunder and although
said Obligations, liabilities or claims, or any of them, shall be contingent or
unmatured.
11.03 Notices. Except as otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including
telegraphic, telex, telecopier or cable communication) and mailed, telegraphed,
telexed, telecopied, cabled or delivered: if to any Credit Party, at the
address specified opposite its signature below or in the other relevant Credit
Documents; if to the Lender, at its address specified on Schedule II; and if to
the Administrative Agent, at the Notice Office; or, as to any Credit Party or
the Administrative Agent, at such other address as shall be designated by such
party in a written notice to the other parties hereto and, as to each Lender,
at such other address as shall be designated by such Lender in a written notice
to the Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied, or cabled
or sent by overnight courier, be effective when deposited in the mails,
delivered to the telegraph company, cable company or overnight courier, as the
case may be, or sent by telex or telecopier, except that notices and
communications to the Administrative Agent and the Borrower shall not be
effective until received by the Administrative Agent or the Borrower, as the
case may be.
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11.04 Benefit of Agreement; Assignments; Participations.
(a) This Agreement shall be binding upon and inure to the benefit
of and be enforceable by the respective successors and assigns
of the parties hereto; provided, however, the Borrower may not
assign or otherwise transfer any of its rights, obligations or
interest hereunder without the prior written consent of the
Lenders and, provided further, that, although any Lender may
transfer or grant participations in its rights hereunder, such
Lender shall remain a "Lender" for all purposes hereunder and
the transferee or participant, as the case may be, shall not
constitute a "Lender" hereunder and, provided further, that no
Lender shall transfer or grant any participation under which
the participant shall have rights to approve any amendment to
or waiver of this Agreement or any other Credit Document
except to the extent such amendment or waiver would (i) extend
the final scheduled maturity of any Loan or Note in which such
participant is participating, or reduce the rate or extend the
time of payment of interest thereon (except in connection with
a waiver of applicability of any post-default increase in
interest rates) or reduce the principal amount thereof, or
increase the amount of the participant's participation over
the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default or of a mandatory
reduction in the Total Commitment, shall not constitute a
change in the terms of such participation, and that an
increase in any Commitment or Loan shall be permitted without
the consent of any participant if the participant's
participation is not increased as a result thereof), (ii)
consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement or (iii)
release all or substantially all of the Collateral under all
of the Security Documents (except as expressly provided in the
Credit Documents) supporting the Loans hereunder in which such
participant is participating. In the case of any such
participation, the participant shall not have any rights under
this Agreement or any of the other Credit Documents (the
participant's rights against such Lender in respect of such
participation to be those set forth in the agreement executed
by such Lender in favor of the participant relating thereto)
and all amounts payable by the Borrower hereunder shall be
determined as if such Lender had not sold such participation.
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(b) Notwithstanding the foregoing, any Lender (or any Lender
together with one or more other Lenders) may (x) assign all or
a portion of its outstanding Obligations hereunder to (i) its
parent company and/or any affiliate of such Lender which is at
least 50% owned by such Lender or its parent company or to one
or more Lenders or (ii) in the case of any Lender that is a
fund that invests in loans, any other fund that invests in
loans and is managed or advised by the same investment advisor
of such Lender or by an Affiliate of such investment advisor
or (y) assign all, or if less than all, a portion equal to at
least $2,000,000 in the aggregate for the assigning Lender or
assigning Lenders, of such outstanding Obligations hereunder
to one or more Eligible Transferees (treating any fund that
invests in loans and any other fund that invests in bank loans
and is managed or advised by the same investment advisor of
such fund or by an Affiliate of such investment advisor as a
single Eligible Transferee), each of which assignees shall
become a party to this Agreement as a Lender by execution of
an Assignment and Assumption Agreement, provided that, (i) at
such time Schedule 1.01(a) shall be deemed modified to reflect
the outstanding Loans of such new Lender and of the existing
Lenders, (ii) upon the surrender of the Note by the assigning
Lender (or, upon such assigning Lender's indemnifying the
Borrower for any lost Note pursuant to a customary
indemnification agreement) new Notes will be issued, at the
Borrower's expense, to such new Lender and to the assigning
Lender upon the request of such new Lender or assigning
Lender, such new Notes to be in conformity with the
requirements of Section 1.05 (with appropriate modifications)
to the extent needed to reflect the revised outstanding Loans,
(iii) the consent of the Agents and the Borrower shall be
required in connection with any assignment to an Eligible
Transferee pursuant to clause (y) above (each of which
consents shall not be unreasonably withheld or delayed,
provided that the consent of the Borrower shall not be
required at any time that an Event of Default exists), (iv)
the Administrative Agent shall receive at the time of each
such assignment, from the assigning or assignee Lender, the
payment of a non-refundable assignment fee of $3,500 (or
$1,500 in the case of an assignment between existing Lenders)
and (v) no such transfer or assignment will be effective until
recorded by the Administrative Agent on the Register pursuant
to Section 11.15. To the extent of any assignment pursuant to
this Section 11.04(b), the assigning Lender shall be relieved
of its obligations hereunder with respect to its assigned
outstanding Loans. At the time of each assignment pursuant to
this Section 11.04(b) to a Person which is not already a
Lender hereunder and which is not a United States person (as
such term is defined in Section 7701(a)(30) of the Code) for
Federal income tax purposes, the respective assignee Lender
shall, to the extent legally entitled to do so, provide to the
Borrower the appropriate Internal Revenue Service Forms (and,
if applicable, a Section 3.04(b)(ii) Certificate) described in
Section 3.04(b). To the extent that an assignment of all or
any portion of a Lender's outstanding Obligations pursuant to
Section 1.13 or this Section 11.04(b) would, at the time of
such assignment, result in increased costs under Section 1.10
or 3.04 from those being charged by the respective assigning
Lender prior to such assignment, then the Borrower shall not
be obligated to pay such increased costs (although the
Borrower, in accordance with and pursuant to the other
provisions of this Agreement, shall be obligated to pay any
other increased costs of the type described above resulting
from changes after the date of the respective assignment).
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(c) Nothing in this Agreement shall prevent or prohibit any Lender
from pledging its Loans and Notes hereunder to a Federal
Reserve Bank in support of borrowings made by such Lender from
such Federal Reserve Bank and, with the consent of the
Administrative Agent, any Lender which is a fund may pledge
all or any portion of its Loans and Notes to its trustee in
support of its obligations to its trustee. No pledge pursuant
to this clause (c) shall release the transferor Lender from
any of its obligations hereunder.
11.05 No Waiver; Remedies Cumulative. No failure or delay on the part of any
Agent, the Collateral Agent or any Lender in exercising any right, power or
privilege hereunder or under any other Credit Document and no course of dealing
between the Borrower or any other Credit Party and any Agent, the Collateral
Agent or any Lender shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or under any other
Credit Document preclude any other or further exercise thereof or the exercise
of any other right, power or privilege hereunder or thereunder. The rights,
powers and remedies herein or in any other Credit Document expressly provided
are cumulative and not exclusive of any rights, powers or remedies which any
Agent, the Collateral Agent or any Lender would otherwise have. No notice to
or demand on any Credit Party in any case shall entitle any Credit Party to any
other or further notice or demand in similar or other circumstances or
constitute a waiver of the rights of any Agent, the Collateral Agent or any
Lender to any other or further action in any circumstances without notice or
demand.
11.06 Payments Pro Rata.
(a) Except as otherwise provided in this Agreement, the
Administrative Agent agrees that promptly after its receipt of
each payment from or on behalf of the Borrower in respect of
any Obligations hereunder, it shall distribute such payment to
the Lenders (other than any Lenders that have consented in
writing to waive its pro rata share of any such payment) pro
rata based upon their respective shares, if any, of the
Obligations with respect to which such payment was received.
(b) Each of the Lenders agrees that, if it should receive any
amount hereunder (whether by voluntary payment, by realization
upon security, by the exercise of the right of setoff or
banker's lien, by counterclaim or cross action, by the
enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the
principal of, or interest on, the Loans, of a sum which with
respect to the related sum or sums received by other Lenders
is in a greater proportion than the total of such Obligation
then owed and due to such Lender bears to the total of such
Obligation then owed and due to all of the Lenders immediately
prior to such receipt, then such Lender receiving such excess
payment shall purchase for cash without recourse or warranty
from the other Lenders an interest in the Obligations of the
respective Credit Party to such Lenders in such amount as
shall result in a proportional participation by all the
Lenders in such amount; provided that if all or any portion of
such excess amount is thereafter recovered from such Lender,
such purchase shall be rescinded and the purchase price
restored to the extent of such recovery, but without interest.
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11.07 Calculations; Computations; Accounting Terms.
(a) The financial statements to be furnished to the Agents
pursuant hereto shall be made and prepared in accordance with
GAAP (except as set forth in the notes thereto or as otherwise
disclosed in writing by the Borrower to the Lenders); provided
that, (i) except as otherwise specifically provided herein,
all computations of Excess Cash Flow, the Applicable Base Rate
Margin and the Applicable Eurodollar Rate Margin and all
computations and all definitions used in determining
compliance with Sections 7.08 through 7.12, inclusive, shall
utilize accounting principles and policies in conformity with
those used to prepare the historical financial statements of
the Borrower referred to in Section 5.05(a) and (ii) from and
after such time as all Existing Senior Secured Notes have been
defeased in accordance with the terms thereof and hereof,
there shall be excluded from the calculation of the Leverage
Ratio, the Consolidated Interest Coverage Ratio and the
Consolidated Fixed Charge Coverage Ratio all Existing Senior
Secured Notes that have been defeased.
(b) All computations of interest and Fees hereunder shall be made
on the basis of a year of 360 days for the actual number of
days (including the first day but excluding the last day)
occurring in the period for which such interest or Fees are
payable.
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11.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY
TRIAL.
(a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL,
EXCEPT AS OTHERWISE PROVIDED IN THE MORTGAGE, BE CONSTRUED IN
ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE OF NEW
YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE
COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR
THE SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND
DELIVERY OF THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT, THE
BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
JURISDICTION OF THE AFORESAID COURTS. THE BORROWER HEREBY
FURTHER IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK
PERSONAL JURISDICTION OVER IT, AND AGREES NOT TO PLEAD OR
CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE
AFOREMENTIONED COURTS, THAT SUCH COURTS LACK PERSONAL
JURISDICTION OVER IT. THE BORROWER FURTHER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE
AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE
MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE BORROWER AT ITS ADDRESS SET FORTH
OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE
30 DAYS AFTER SUCH MAILING. THE BORROWER HEREBY IRREVOCABLY
WAIVES ANY OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER
IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER
CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY WAY INVALID
OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
ADMINISTRATIVE AGENT, ANY LENDER OR THE HOLDER OF ANY NOTE TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE
BORROWER IN ANY OTHER JURISDICTION.
(b) THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF THE
AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF OR IN
CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (A) ABOVE AND
HEREBY FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
SUCH COURT THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY
SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.
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(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT,
THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.
11.09 Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
11.10 Effectiveness. This Agreement shall be come effective on the date (the
"Effective Date") on which (i) the Borrower, each Agent and each of the Lenders
shall have signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered the same to the Administrative Agent at
the Notice Office, or, in the case of the Lenders, shall have given to the
Administrative Agent telephonic (confirmed in writing), written or telex notice
(actually received) at such office that the same has been signed and mailed to
it and (ii) the conditions set forth in Section 4 are met to the satisfaction
of the Administrative Agent and the Required Lenders. Unless the
Administrative Agent has received actual notice from any Lenders that the
conditions contained in Section 4 have not been met to its satisfaction, upon
the satisfaction of the condition described in clause (i) of the immediately
preceding sentence and upon the Administrative Agent's good faith determination
that the conditions described in clause (ii) of the immediately preceding
sentence have been met, then the Effective Date shall have been deemed to have
occurred, regardless of any subsequent determination that one or more of the
conditions thereto had not been met. The Administrative Agent will give the
Borrower and each Lender prompt written notice of the occurrence of the
Effective Date.
11.11 Headings Descriptive. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not
in any way affect the meaning or construction of any provision of this
Agreement.
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11.12 Amendment or Waiver; etc.
(a) Neither this Agreement nor any other Credit Document nor any
terms hereof or thereof may be changed, waived, discharged or
terminated unless such change, waiver, discharge or
termination is in writing signed by the respective Credit
Parties party thereto and the Required Lenders, provided that
no such change, waiver, discharge or termination shall,
without the consent of each Lender (other than a Defaulting
Lender) (with Obligations being directly affected in the case
of following clause (i)), (i) extend the final scheduled
maturity of any Loan or Note, or reduce the rate or extend the
time of payment of interest or Fees thereon, or reduce the
principal amount thereof (except to the extent repaid in cash)
(it being understood that any amendment or modification to the
financial definitions in this Agreement or to Section 11.07(a)
shall not constitute a reduction in the rate of interest or
Fees for the purposes of this clause (i)), (ii) release all or
substantially all of the Collateral (except as expressly
provided in the Credit Documents) under all the Security
Documents, (iii) amend, modify or waive any provision of this
Section 11.12, (iv) reduce the percentage specified in the
definition of Required Lenders (it being understood that, with
the consent of the Required Lenders, additional extensions of
credit pursuant to this Agreement may be included in the
determination of the Required Lenders on substantially the
same basis as the extensions of Loans are included on the
Effective Date) or (v) consent to the assignment or transfer
by the Borrower of any of its rights and obligations under
this Agreement; provided further, that no such change, waiver,
discharge or termination shall (x) increase the Commitments of
any Lender over the amount thereof then in effect without the
consent of such Lender (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or
Events of Default or of a mandatory reduction in the Total
Commitment shall not constitute an increase of the Commitment
of any Lender, and that an increase in the available portion
of any Commitment of any Lender shall not constitute an
increase of the Commitment of such Lender), (y) without the
consent of the Administrative Agent, amend, modify or waive
any provision of Section 10 or any other provision as same
relates to the rights or obligations of the Administrative
Agent or (z) without the consent of the Collateral Agent,
amend, modify or waive any provision relating to the rights or
obligations of the Collateral Agent.
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(b) If, in connection with any proposed change, waiver, discharge
or termination to any of the provisions of this Agreement as
contemplated by clauses (i) through (v), inclusive, of the
first proviso to Section 11.12(a), the consent of the Required
Lenders is obtained but the consent of one or more of such
other Lenders whose consent is required is not obtained, then
the Borrower shall have the right, so long as all
non-consenting Lenders whose individual consent is required
are treated as described in either clauses (A) or (B) below,
to either (A) replace each such non-consenting Lender or
Lenders with one or more Replacement Lenders pursuant to
Section 1.13 so long as at the time of such replacement, each
such Replacement Lender consents to the proposed change,
waiver, discharge or termination or (B) repay the outstanding
Loans of such non-consenting Lender in accordance with Section
3.01(b), provided that, unless the Loans that are repaid,
pursuant to preceding clause (B) are immediately replaced in
full at such time through the addition of new Lenders or the
increase of the outstanding Loans of existing Lenders (who in
each case must specifically consent thereto), then in the case
of any action pursuant to preceding clause (B) the Required
Lenders (determined after giving effect to the proposed
action) shall specifically consent thereto, provided further,
that in any event the Borrower shall not have the right to
replace a Lender, or repay its Loans solely as a result of the
exercise of such Lender's rights (and the withholding of any
required consent by such Lender) pursuant to the second
proviso to Section 11.12(a).
11.13 Survival. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 3.04, 10.06 and 11.01 shall survive the
execution, delivery and termination of this Agreement and the Notes and the
making and repayment of the Obligations.
11.14 Domicile of Loans. Each Lender may transfer and carry its Loans at, to
or for the account of any office, Subsidiary or Affiliate of such Lender.
Notwithstanding anything to the contrary contained herein, to the extent that a
transfer of Loans pursuant to this Section 11.14 would, at the time of such
transfer, result in increased costs under Section 1.10 or 3.04 from those being
charged by the respective Lender prior to such transfer, then the Borrower
shall not be obligated to pay such increased costs (although the Borrower shall
be obligated to pay any other increased costs of the type described above
resulting from changes after the date of the respective transfer).
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11.15 Register. The Borrower hereby designates the Administrative Agent to
serve as the Borrower's agent, solely for purposes of this Section 11.15, to
maintain a register (the "Register") on which it will record the Commitments
from time to time of each of the Lenders, the Loans made by each of the Lenders
and each repayment in respect of the principal amount of the Loans of each
Lender. Failure to make any such recordation, or any error in such recordation
shall not affect the Borrower's obligations in respect of such Loans. With
respect to any Lender, the transfer of the Commitments of such Lender and the
rights to the principal of, and interest on, any Loan made pursuant to such
Commitments shall not be effective until such transfer is recorded on the
Register maintained by the Administrative Agent with respect to ownership of
such Commitments and Loans and prior to such recordation all amounts owing to
the transferor with respect to such Commitments and Loans shall remain owing to
the transferor. The registration of assignment or transfer of all or part of
any Commitments and Loans shall be recorded by the Administrative Agent on the
Register only upon the acceptance by the Administrative Agent of a properly
executed and delivered Assignment and Assumption Agreement pursuant to Section
11.04(b). Coincident with the delivery of such an Assignment and Assumption
Agreement to the Administrative Agent for acceptance and registration of
assignment or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Lender shall surrender the Note
evidencing such Loan, and thereupon one or more new Notes in the same aggregate
principal amount shall be issued to the assigning or transferor Lender Bank
and/or the new Lender. The Borrower agrees to indemnify the Administrative
Agent from and against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or incurred by the
Administrative Agent in performing its duties under this Section 11.15.
94
11.16 Confidentiality.
(a) Subject to the provisions of clause (b) of this Section 11.16,
each Lender agrees that it will use its reasonable efforts not
to disclose without the prior consent of the Borrower (other
than to its employees, auditors, advisors or counsel or to
another Lender or to any Person who evaluates, approves,
structures or administers the Loans on behalf of a Lender, in
either case if the Lender or such Lender's holding or parent
company in its sole discretion determines that any such party
should have access to such information, provided such Persons
shall be subject to the provisions of this Section 11.16 to
the same extent as such Lender) any information with respect
to the Borrower or any of its Subsidiaries which is now or in
the future furnished pursuant to this Agreement or any other
Credit Document and which is designated by the Borrower to the
Lenders in writing as confidential (it being understood that
all information delivered pursuant to Section 6.01(c) shall be
considered confidential information), provided that any Lender
may disclose any such information (i) as has become generally
available to the public other than by virtue of a breach of
this Section 11.16(a) by the respective Lender, (ii) as may be
required or appropriate in any report, statement or testimony
submitted to any municipal, state or Federal regulatory body
having or claiming to have jurisdiction over such Lender or to
the Federal Reserve Board, the Federal Deposit Insurance
Corporation or the NAIC or similar organizations (whether in
the United States or elsewhere) or their successors, (iii) as
may be required or appropriate in respect to any summons or
subpoena or in connection with any litigation, (iv) in order
to comply with any law, order, regulation or ruling applicable
to such Lender, (v) to any Agent or the Collateral Agent and
(vi) to any prospective or actual transferee or participant in
connection with any contemplated transfer or participation of
any of the Notes or Commitments or any interest therein by
such Lender, provided that such prospective transferee agrees
to be bound by the confidentiality provisions contained in
this Section 11.16.
(b) The Borrower hereby acknowledges and agrees that each Lender
may share with any of its affiliates any information related
to the Borrower or any of its Subsidiaries (including, without
limitation, any nonpublic customer information regarding the
creditworthiness of the Borrower and its Subsidiaries),
provided such Persons shall be subject to the provisions of
this Section 11.16 to the same extent as such Lender).
* * *
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
Address:
Acme Metals Incorporated
00000 X. Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attn: Treasurer
95
By: /s/ Xxxxx X. Xxxxxxxxx
---------------------------
Title: Treasurer
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
with a copy to:
00000 X. Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attn: General Counsel
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
XXXXXX XXXXXXX SENIOR FUNDING,
INC., Individually and as Syndication Agent
and Arranger
By: /s/ Xxxxxxx XxXxxxxxxx
---------------------------
Title: Principal
BANKERS TRUST COMPANY,
Individually and as Administrative Agent
By: /s/ Xxxxxx X. Xxxxxxx
---------------------------
Title: Assistant Vice President
SANWA BUSINESS CREDIT CORPORATION
By: /s/ Xxxxx Xxxxx
---------------------------
Title: First Vice President
XXXXXXX XXXXX SENIOR FLOATING RATE FUND, INC.
By: /s/ Xxxx X. Xxxxxxxx
---------------------------
Title: Authorized Signatory
GCB INVESTMENT PORTFOLIO
By: Citibank, N.A.
By: /s/ Xxxxx Xxxxxxx
---------------------------
Title: Vice President
KZH HOLDING CORPORATION III
By: /s/ X. Xxxxxx
---------------------------
Title: Authorized Agent
FLOATING RATE PORTFOLIO
By: Chancellor LGT Senior Secured
Management, Inc., as Attorney-in-fact
By: /s/ Xxxxx Xxxxxx
---------------------------
Title: Managing Director
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COMMITMENTS
Bank Commitment
---- ----------
Xxxxxx Xxxxxxx Senior Funding, Inc. $113,500,000.00
Bankers Trust Company $ 15,000,000.00
Sanwa Business Credit Corporation $ 18,000,000.00
Xxxxxxx Xxxxx Senior Floating Rate Fund, Inc. $ 10,000,000.00
GCB Investment Portfolio $ 10,000,000.00
KZH Holding Corporation III $ 5,000,000.00
Floating Rate Portfolio $ 3,500,000.00
TOTAL: $175,000,000.00
---------------
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BANK ADDRESSES
Bank Address
---- -------
Xxxxxx Xxxxxxx Senior Funding, Inc. 0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
with a copy to:
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx XxXxxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Bankers Trust Company 000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Sanwa Business Credit Corporation Xxx Xxxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxx Xxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Xxxxxxx Xxxxx Senior Floating Rate Fund, Inc. 000 Xxxxxxxx Xxxx Xxxx
Xxxx 0X
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxx Xxxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
98
GCB Investment Portfolio 000 Xxxxxxxxx Xxxxxx
00xx Floor/Zone 00
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
KZH Holding Corporation III x/x Xxx Xxxxx Xxxxxxxxx Bank
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxxx Xxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Floating Rate Portfolio Address for Administrative Notices:
Chancellor LGT Asset Management, Inc.
00 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx XxXxxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
Address for Notices regarding Amendments and Waivers:
GT Global Floating Rate Fund, Inc.
c/o Chancellor LGT Senior Secured Management, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx XxXxxxx
Tel. No.: (000) 000-0000
Fax No.: (000) 000-0000
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CERTAIN TAX MATTERS
100
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PLANS
101
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REAL PROPERTIES
102
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CAPITALIZATION
103
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SUBSIDIARIES
104
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CERTAIN ENVIRONMENTAL MATTERS
105
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EXISTING INDEBTEDNESS
106
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INSURANCE
107
EXISTING LIENS
Filing File Original Description Permitted
Location Debtor Secured Party Number File Date of Collateral Refinancing
-------- ------ ------------- ------ --------- ------------- -----------
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EXISTING INVESTMENTS
109
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CERTAIN TRANSACTIONS WITH AFFILIATES
110
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CERTAIN TAKE-OR-PAY OBLIGATIONS