EXECUTION COPY
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SUBORDINATED TERM LOAN CREDIT AGREEMENT
among
GENMAR HOLDINGS, INC.
THE FINANCIAL INSTITUTIONS NAMED HEREIN
THE BANK OF NEW YORK
As Agent
and
BNY CAPITAL MARKETS, INC.
As Arranger
Dated as of October 20, 1997
$60,000,000
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SUBORDINATED TERM LOAN CREDIT AGREEMENT (hereinafter the "Agreement"),
dated as of October 20, 1997, among GENMAR HOLDINGS, INC., a Delaware
corporation (the "Borrower"), the Lenders (as hereinafter defined), THE BANK OF
NEW YORK, acting in its capacity as agent for the Lenders (the "Agent") and BNY
CAPITAL MARKETS, INC., as Arranger (the "Arranger").
SECTION 1 DEFINITIONS.
Section 1.1 DEFINITIONS. As used herein, the following terms shall
have the meanings herein specified unless the context otherwise requires.
Defined terms in this Agreement shall include in the singular number the plural
and in the plural number the singular.
"ACCOUNTS" shall mean all accounts, accounts receivable, other
receivables, contract rights, chattel paper, instruments, documents and notes,
whether now owned or hereafter acquired by the Borrower or any of its
Subsidiaries.
"ACCOUNT DEBTOR" shall mean any Person who is or who may become obligated
to the Borrower or any of its Subsidiaries under, with respect to, or on account
of, an Account.
"ADVANCE" shall have the meaning provided in Section 2.1.
"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 a corporation if
such Person possesses, directly or indirectly, the power to (i) vote 5% or more
of the securities having ordinary voting power for the election of directors of
such corporation or (ii) direct or cause the direction of the management and
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.
"AGENT" shall mean The Bank of New York acting in its capacity as agent
for the Lenders and any successor agent appointed in accordance with Section
9.9.
"AGENT'S OFFICE" shall mean the office of the Agent located at Xxx Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or such other office as the Agent may
hereafter designate in writing as such to the other parties hereto.
"AGREEMENT" shall mean this Subordinated Term Loan Credit Agreement as
the same may from time to time hereafter be modified, restated, supplemented or
amended.
"AGREEMENT DATE" means the date set forth as such on the signature pages
hereof, which date is the date the executed copies of this Agreement were
delivered by all parties hereto and, accordingly, the date this Agreement became
effective and the Lenders first became committed to make the Loans and other
extensions of credit contemplated by this Agreement. If no such
date is there set forth, the Agreement Date shall be the date as of which
this Agreement is dated.
"ALTERNATE BASE RATE" shall mean, at any particular date, the interest
rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Rate in effect on such day plus 1/2%. For purposes hereof, the term
"PRIME RATE" shall mean the prime commercial lending rate of The Bank of New
York as publicly announced from time to time, such rate to be adjusted
automatically, without notice, on the date of any change in such rate. The
Prime Rate is not necessarily The Bank of New York's lowest rate of interest.
The term "FEDERAL FUNDS RATE" shall mean, for any day, 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 on the next
succeeding Business Day by the Federal Reserve Bank of New York or, if such rate
is not so published for any day that is a Business Day, the average of the
quotations for the day of such transaction received by the Agent from three
Federal funds brokers of recognized standing selected by it. If the Agent shall
have determined that it is unable to ascertain the Federal Funds Rate for any
reason, including the inability or failure of the Agent to obtain sufficient
quotations in accordance with the terms hereof, the Alternative Base Rate shall
be determined with regard to clause (a) of the first sentence of this
definition, as appropriate, until the circumstances giving rise to such
inability no longer exist. Any change in the Alternate Base Rate due to a
change in the Prime Rate or the Federal Funds Rate shall be effective on the
date of such change in the Prime Rate or Federal Funds Rate, respectively.
"ARRANGER" shall have the meaning provided in the preamble to this
Agreement.
"ASSIGNMENT OF RENTS AND LEASES" shall mean an assignment of rents and
leases which have been executed and delivered to the Agent by the Loan Parties
party thereto under and in connection with this Agreement (as any such
assignment of rents and leases may be amended, modified or supplemented from
time to time).
"AVERAGE LIFE" means, as of the date of determination, with respect to
any security or instrument, the quotient obtained by dividing (i) the sum of the
products of the number of years from the date of determination to the dates of
each successive scheduled principal (or redemption) payment of such security or
instrument multiplied by the amount of such principal (or redemption) payment by
(ii) the sum of all such principal (or redemption) payments.
"BANKRUPTCY CODE" shall mean Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time, and any successor statute or
statutes.
"BASE RATE LOANS" shall mean the Loan made and/or being maintained at a
rate of interest based upon the Alternate Base Rate.
"BNY INTERCREDITOR AGREEMENT" shall mean the Intercreditor Agreement
dated as of October 20, 1997 between the Agent and The Bank of New York, as
agent under the BNY Senior Credit Agreement (as such intercreditor agreement may
be amended, modified, supplemented or restated from time to time).
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"BNY SENIOR CREDIT AGREEMENT" means the Second Amended and Restated
Credit Agreement dated as of July 1, 1997 among the Borrower, the financial
institutions named therein and The Bank of New York, as Agent (as such credit
agreement may be amended, modified, supplemented, refinanced or restated from
time to time; PROVIDED that, in the event of any amendment, modification,
supplement, refinancing or restatement, the principal amount of the Indebtedness
under such credit agreement shall not be increased to a principal amount in
excess of $100,000,000).
"BORROWER" shall have the meaning provided in the first paragraph of this
Agreement.
"BORROWING" shall mean the incurrence of one Type of Loan from all the
Lenders on a given date (or resulting from conversions or continuations on a
given date), having in the case of Eurodollar Loans the same Interest Period.
"BORROWING DATE" shall mean a date on which the Borrower has borrowed an
Advance as provided by Section 2.1.
"BORROWING PERIOD" shall have the meaning provided in Section 2.1.
"BUSINESS DAY" shall mean (i) for all purposes other than as covered by
clause (ii) below, any day excluding Saturday, Sunday and any day which shall be
in New York City or Minneapolis a legal holiday or a day on which banking
institutions are authorized or required by law or other government actions 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) and which is also a day for trading by
and between banks for U.S. dollar deposits in the relevant interbank Eurodollar
market.
"CAPITAL EXPENDITURES" shall mean, for any period, the sum of
expenditures (whether paid in cash or accrued as a liability, including the
portion of Capitalized Leases originally incurred during such period that is
capitalized on the consolidated balance sheet of the Borrower and its
Subsidiaries) by the Borrower and its Subsidiaries during such period that, in
conformity with GAAP, are included in "capital expenditures", "additions to
property, plant, tooling or equipment" or comparable items in the consolidated
financial statements of the Borrower and its Subsidiaries.
"CAPITALIZED LEASE" shall mean (i) any lease of property, real or
personal, the obligations under which are capitalized on the consolidated
balance sheet of the Borrower and its Subsidiaries, and (ii) any other such
lease to the extent that the then present value of the minimum rental commitment
thereunder should, in accordance with GAAP, be capitalized on a balance sheet of
the lessee.
"CAPITALIZED LEASE OBLIGATIONS" shall mean all obligations of the
Borrower and its Subsidiaries under or in respect of Capitalized Leases.
"CASH EQUIVALENTS" shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that
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the full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than 90 days from the date of
acquisition, (ii) time deposits and certificates of deposit of any Lender or
any domestic commercial bank of recognized standing having capital and
surplus in excess of $500,000,000 with maturities of not more than 90 days
from the date of acquisition, (iii) fully secured repurchase obligations with
a term of not more than seven (7) days for underlying securities of the types
described in clause (i) entered into with any bank meeting the qualifications
specified in clause (ii) above, and (iv) commercial paper issued by the
parent corporation of any Lender or any domestic commercial bank of
recognized standing having capital and surplus in excess of $500,000,000 and
commercial paper or master notes of issuers, rated at least A-2 or the
equivalent thereof by Standard & Poor's Corporation or at least P-2 or the
equivalent thereof by Xxxxx'x Investor Services, Inc. and in each case
maturing within 90 days after the date of acquisition.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and any successor statute.
"COLLATERAL" shall mean all property and interests in property now owned
or hereafter acquired in or upon which a Lien has been or is purported or
intended to have been granted to the Agent or any Lender under any of the
Security Documents.
"COLLATERAL ACCOUNT" means (i) the account of the Issuing Banks in the
name of the Agent maintained at The Bank of New York and designated by the Agent
as the "Collateral Account" (ii) each deposit, custody or other account
(whether, in any case, time or demand or interest or non-interest bearing and
whether maintained at a branch or office located within or without the United
States) that is a successor to (A) the account referred to in clause (i) or (B)
a Collateral Account which is such by virtue of this clause (ii), (iii) all
amounts from time to time credited to the Collateral Account, (iv) all cash,
securities, instruments, documents, chattel paper, general intangibles, accounts
and other property (A) from time to time credited to the Collateral Account or
(B) representing investments and reinvestments of amounts from time to time
credited to the Collateral Account, and (v) (A) dividends (whether or not
payable in cash), interest, principal payments and other distributions
(including cash and securities payable in connection with calls, conversions,
redemptions and the like), on, and all rights, contractual and otherwise,
(whether such dividends, interest, principal payments and other distributions
and rights constitute accounts, contract rights, or general intangibles),
arising under, connected with or in any way related to, and (B) proceeds
(including cash and securities receivable in connection with tender and other
offers) of, the Collateral Account.
"COLLATERAL ACCOUNT AGREEMENT" shall mean a collateral account agreement,
among the Agent and an Issuing Bank in the form attached as Annex D to the
Letters of Credit (as such collateral account agreement may be amended, modified
or supplemented from time to time).
"COLLATERAL ACCOUNT COLLATERAL" means the following, IN EACH CASE WHETHER
NOW OR HEREAFTER EXISTING AND WHETHER OR NOT THE SAME IS NOW CONTEMPLATED,
ANTICIPATED OR FORESEEABLE, is subject to Article 8 or 9 of the Uniform
Commercial Code or constitutes Collateral Account Collateral by reason of one or
more
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than one of the following clauses:
(i) the Collateral Account;
(ii) all rights (contractual and otherwise and whether
constituting accounts, contract rights or general intangibles) arising under,
connected with or in any way related to the Collateral Account;
(iii) all claims (including the right to sue or otherwise recover
on such claim) (A) to items referred to in the definition of Collateral, (B)
under warranties relating to any of the Collateral, and (C) against third
parties that in any way arise under or out of or are related to or connected
with any or all of the Collateral; and
(iv) all products and proceeds of Collateral in whatever form.
The inclusion of "proceeds" of Collateral in the definition of "Collateral"
shall not be deemed a consent by the Agent to any sale or other disposition of
any Collateral not otherwise specifically permitted by the terms of a Collateral
Account Agreement.
"COLLATERAL AGENT" has the meaning assigned to that term in the Security
Agreements.
"COMMITMENT" shall mean, for each Lender at any given time, the amount
set forth opposite such Xxxxxx's name on Annex I hereto under the heading
"Commitment", as such amount may be reduced from time to time pursuant to
Sections 2.10, 2.14 or 10.4(c).
"CONTINGENT OBLIGATION" as to any Person shall mean 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 owner
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.
"CREDIT EXPOSURE" shall have the meaning provided in Section 10.4(c).
"DEALER ACCOUNT TRANSACTION" shall mean the sale by the Borrower and any
of its
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Subsidiaries of their respective dealer account financing business at a
price of not less than the face value of the assets sold thereby to one or more
financial institutions and for an aggregate purchase price of up to $20,000,000
and which transaction or transactions may permit, during the months of February
through August, inclusive, only of each calendar year, an aggregate outstanding
amount of receivables so sold or from time to time guaranteed by the Borrower
and any of its Subsidiaries not to exceed $25,000,000 in the aggregate during
such period.
"DEFAULT" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"DEFAULT RATE" shall have the meaning provided in Section 2.4(c).
"DESIGNATED SUBSIDIARY" shall mean those Subsidiaries of the Borrower
listed as such on Schedule 1.1(b), Annex A, paragraph 3 through 6 thereof.
"DIVIDENDS" shall have the meaning provided in Section 7.6.
"DOMESTIC LENDING OFFICE" shall mean, as to any Lender, the office of
such Lender designated as such on Annex I, or such other office designated by
such Lender from time to time by written notice to the Agent and the Borrower.
"DRAWING EVENT" has the meaning ascribed to that term in the Letters of
Credit.
"DUE DATE" shall mean the date on which payment is due with respect to an
Account, as indicated on the invoice or statement of Account rendered to the
Account Debtor.
"ENVIRONMENTAL AFFILIATE" shall mean, with respect to any Person, any
other Person whose liability for any Environmental Claim such Person has or may
have retained, assumed or otherwise become liable for (contingently or
otherwise), either contractually or by operation of law.
"ENVIRONMENTAL CLAIM" shall mean, with respect to the Borrower, any
notice, claim, demand or similar written communication made upon the Borrower or
any of its Subsidiaries by any other Person (including any Environmental
Affiliate) alleging potential liability in connection with investigatory costs,
cleanup costs, governmental response costs, natural resources damages, property
damages, personal injuries, fines or penalties arising out of, based on or
resulting from (i) the presence, or release into the environment, of any
Material of Environmental Concern at any location, whether or not owned by such
Person or (ii) circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"ENVIRONMENTAL LAWS" shall mean all Federal, state, local and foreign
laws and regulations relating to pollution or protection of human health or the
environment (including, without limitation, ambient air, surface water, ground
water, land surface or subsurface strata), including without limitation, laws
and regulations relating to emissions, discharges, releases or threatened
releases of Materials of Environmental Concern, or otherwise relating to the
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manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Materials of Environmental Concern.
"ENVIRONMENTAL LIEN" shall mean any Lien imposed pursuant to any
Environmental Law with respect to any of the Properties.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time. 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.
"EUROCURRENCY RESERVE REQUIREMENTS" shall mean, with respect to each day
during an Interest Period for Eurodollar Loans, that percentage (expressed as a
decimal) which is in effect on such day, as prescribed by the Federal Reserve
Board or other governmental authority or agency having jurisdiction with respect
thereto for determining the maximum reserves (including, without limitation,
basic, supplemental, marginal and emergency reserves) for eurocurrency funding
(currently referred to as "Eurocurrency Liabilities" in Regulation D) maintained
by a member bank of the Federal Reserve System.
"EURODOLLAR BASE RATE" shall mean, with respect to each day during an
Interest Period for Eurodollar Loans, the rate per annum (rounded upwards to the
nearest whole multiple of one-sixteenth of one percent) equal to the offered
quotation to first class banks in the interbank eurodollar market by The Bank of
New York two Business Days prior to the beginning of such Interest Period at or
about 10:00 A.M., New York City time, for delivery on the first day of such
Interest Period for the number of days comprised therein and in an amount
comparable to the amount of the Eurodollar Loan of The Bank of New York to be
outstanding during such Interest Period.
"EURODOLLAR LENDING OFFICE" shall mean, as to any Lender, the office of
such Lender designated as such on Annex I, or such other office designated by
such Lender from time to time by written notice to the Agent and the Borrower.
"EURODOLLAR LOANS" shall mean Loans made and/or being maintained at a
rate of interest based upon the Eurodollar Rate.
"EURODOLLAR RATE" shall mean with respect to each day during an Interest
Period for Eurodollar Loans, a rate per annum determined for such day in
accordance with the following formula (rounded upwards to the nearest whole
multiple of 1/100th of one percent):
EURODOLLAR BASE RATE
--------------------
1.00 - Eurocurrency Reserve Requirements
"EVENT OF DEFAULT" shall have the meaning provided in Section 8.
"EXISTING NOTES" shall mean, collectively, the Subordinated Shareholder
Note and the
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Subordinated Demand Note.
"FEDERAL RESERVE BOARD" shall mean the Board of Governors of the Federal
Reserve System as constituted from time to time.
"FEES" shall mean all amounts payable pursuant to Section 2.13.
"FINAL MATURITY DATE" shall mean October 21, 2002.
"FIRST BANK" shall mean First Bank National Association, its successors
and assigns, and, if a Letter of Credit replacing part or all of its Letters of
Credit shall have been issued, the issuer of (a) such replacement Letter of
Credit and (b) each Letter of Credit (a "Replacing Letter of Credit") replacing
such Replacement Letter of Credit or any other Replacing Letter of Credit.
"FLOOR PLAN FINANCING" shall mean that certain floor planning arrangement
among the Borrower and/or any of its Subsidiaries and one or more financial
institutions pursuant to which any such financial institution provides credit to
retail dealers and wholesale distributors which purchase goods from the Borrower
and any of its Subsidiaries.
"GAAP" shall mean United States generally accepted accounting principles
as in effect on the date hereof and consistent with those utilized in the
preparation of the financial statements referred to in Section 5.5.
"GII" shall mean Genmar Industries, Inc., a Delaware corporation and a
wholly-owned indirect subsidiary of the Borrower.
"GOVERNMENTAL APPROVAL" has the meaning ascribed to that term in Section
5.10.
"GUARANTORS" shall mean the Restricted Subsidiaries and each other Person
who executes and delivers to the Agent an agreement to become a Guarantor in the
form of Annex B to the Guaranty.
"GUARANTY" shall mean each guaranty which has been executed and delivered
by each Guarantor under and in connection with this Agreement, together with
each other guaranty required to be executed in accordance with the terms and
provisions hereof, in each case in the form of Exhibit 1.1(b) hereto, (as any
such guaranty have been, are being or hereafter may be amended, modified or
supplemented from time to time).
"HEDGING AGREEMENTS" shall mean interest rate swap, cap or collar
agreements, interest rate future or option contracts and other similar
agreements.
"IMPROVEMENTS" shall mean have the meaning set forth therefor in the
Mortgages.
"INDEBTEDNESS" of any Person shall mean, without duplication, (i) all
indebtedness of such Person for borrowed money or for the deferred purchase
price of property or services, other than (x) trade payables on terms of 90 days
or less incurred in the ordinary course of business of such Person and (y) notes
issued in connection with insurance premiums payable in the ordinary
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course of business of such Person in an aggregate principal amount not to
exceed $750,000 outstanding at any time, (ii) all indebtedness of such Person
evidenced by a note (other than such notes referred to in subclause (i)(y) of
this definition), bond, debenture or similar instrument, (iii) the principal
component of all Capitalized Lease obligations of such Person, (iv) the face
amount of all letters of credit issued for the account of such Person and,
without duplication, all unreimbursed amounts drawn thereunder, (v) all
indebtedness of any other Person secured by any Lien on any property owned by
such Person, whether or not such indebtedness has been assumed, (vi) all
Contingent Obligations of such Person, and (vii) all Hedging Agreements and
currency swaps and similar agreements of such Person in accordance with GAAP.
"INSTRUMENT OF ASSIGNMENT" has the meaning ascribed to that term in the
Letter of Credit.
"INTEREST PERIOD" shall have the meaning provided in Section 2.5.
"INTERNAL FINANCIALS" shall have the meaning provided in Section 5.5.
"INVENTORY" shall mean any and all now owned or hereafter acquired
inventory, goods, merchandise, and other tangible personal property intended for
sale or lease, in the custody or possession, actual or constructive, of the
Borrower or any of its Subsidiaries, or in transit to the Borrower or any of its
Subsidiaries, including such inventory as is on consignment to third parties,
leased to customers of the Borrower or any of its Subsidiaries, or otherwise
temporarily out of the custody or possession of the Borrower or any of its
Subsidiaries.
"ISSUING BANK" shall mean an issuer of a Letter of Credit.
"JUNIOR SECURITIES" of any Person means securities (including capital
stock) issued by such Person to a Lender on account of the Obligations payable
to such Lender pursuant to an order or decree of a court of competent
jurisdiction in a reorganization proceeding under any applicable bankruptcy or
reorganization law, which securities (i) have a maturity, mandatory redemption
obligation or put right, if any, longer than, or occurring after the final
maturity date of, all Senior Indebtedness, of such Person outstanding on the
date of issuance of such Junior Securities (and to any securities issued in
exchange for any such Senior Indebtedness), (ii) are unsecured, (iii) have an
Average Life longer than the securities for which such Junior Securities are
being exchanged, (iv) in the case of debt securities, do not provide for terms
and conditions, and in the case of equity securities do not provide for
covenants, more onerous to such Person than those provided in this Agreement and
(v) by their terms or by law are subordinated to Senior Indebtedness of such
Person outstanding on the date of issuance of such Junior Securities (and to any
securities in exchange for any such Senior Indebtedness), at least to the same
extent as the Subordinated Indebtedness.
"LENDERS" shall mean the financial institutions listed on Annex I hereto
and the financial institutions which from time to time become a party hereto in
accordance with Section 10.4(c).
"LETTER OF CREDIT" shall mean a letter of credit substantially in the
form of Exhibit 1.1(a) to this Agreement, issued by Persons acceptable at time
of issuance to all Lenders (as such letter of credit may be amended, modified or
supplemented from time to time). The initial Letters of
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Credit shall be issued by First Bank and Northern Trust Company, respectively.
"LIEN" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), or 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 lease having substantially the same effect as any of
the foregoing and the filing of any financing statement or similar instrument
under the Uniform Commercial Code or comparable law of any jurisdiction,
domestic or foreign.
"LOAN" shall have the meaning provided in Section 2.1.
"LOAN DOCUMENTS" shall mean this Agreement, the Notes, the Security
Documents, the BNY Intercreditor Agreement and the Subordination Agreements
entered into by the Borrower or its Subsidiaries, as applicable, with one or
more Lenders.
"LOAN PARTY" shall mean and include the Borrower and the Restricted
Subsidiaries.
"MARGIN PERCENTAGE" shall mean at any time 0.45%.
"MARGIN STOCK" shall have the meaning provided such term in Regulation U
and Regulation G of the Federal Reserve Board.
"MATERIAL ADVERSE EFFECT" shall mean a material adverse effect upon (i)
the business, operations, properties, assets, prospects or condition (financial
or otherwise) of the Borrower and its Subsidiaries, taken as a whole, or (ii)
the ability of any Loan Party to perform, or of the Agent or any of the Lenders
to enforce, any of the Obligations.
"MATERIALS OF ENVIRONMENTAL CONCERN" shall mean and include chemicals,
pollutants, contaminants, wastes, toxic substances, petroleum and petroleum
products.
"MORTGAGED PROPERTIES" shall mean each Property set forth on Schedule
1.1(a).
"MORTGAGES" shall mean the mortgages and/or deeds of trust encumbering
the Mortgaged Property which have been executed and delivered to the Agent by
the Loan Parties party thereto under and in connection with this Agreement (as
any such mortgages have been, are being or hereafter may be amended, modified or
supplemented from time to time).
"NON-PAYMENT DEFAULT" means any event (other than a Payment Default) upon
the occurrence of which the maturity of the Senior Indebtedness may be
accelerated.
"NOTE" shall have the meaning provided in Section 2.1.
"NOTICE OF BORROWING" shall have the meaning provided in Section 2.2(a).
"NOTICE OF CONVERSION OR CONTINUATION" shall have the meaning provided in
Section 2.7(b).
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"OBLIGATIONS" shall mean all obligations, liabilities and indebtedness of
every nature of the Borrower and the Guarantors from time to time owing to the
Agent, or any Lender under or in connection with this Agreement or any other
Loan Document.
"OBLIGOR" shall have the meaning provided in Section 11.2.
"OFFICER'S CERTIFICATE" means a certificate signed by the Chairman of the
Board, Vice Chairman, the President, Chief Financial Officer or a Vice
President (regardless of vice presidential designation) of the Borrower.
"PARTICIPANT" shall have the meaning provided in Section 10.4(b).
"PAYMENT DATE" shall mean the last day of each January, April, July and
October of each year.
"PAYMENT DEFAULT" means any default (beyond any applicable grace period)
in the payment of principal of, or interest on, any Senior Indebtedness or of
any other amount in excess of $100,000 of any Senior Indebtedness.
"PERMITTED LIENS" shall have the meaning provided in Section 7.2(a).
"PERMITTED ORGANIZATIONAL CHANGES" shall mean the changes to the
ownership of Subsidiaries and the transfer of assets among the Loan Parties
described in Schedule 1.1(b).
"PERSON" shall mean and include any individual, partnership, joint
venture, firm, corporation, association, trust or other enterprise or any
government or political subdivision or agency, department or instrumentality
thereof.
"PLEDGE AGREEMENT" shall mean a pledge agreement substantially in the
form of Exhibit 1.1(c) hereto (as such pledge agreement may be amended, modified
or supplemented from time to time).
"PROPERTIES" shall mean the real properties, and the improvements
thereon, listed on Schedule 5.21(a)(i).
"PRO RATA SHARE" as to any Lender shall mean a fraction (expressed as a
percentage), the numerator of which shall be the amount of such Xxxxxx's
Commitment and the denominator of which shall be the Total Commitment.
"PURCHASING LENDERS" shall have the meaning provided in Section 10.4(c).
"RECOURSE OBLIGATIONS" shall mean the recourse and repurchase obligations
of the Borrower and any of its Subsidiaries pursuant to a Repurchase Agreement.
"RECOVERABLE AMOUNT" has the meaning ascribed to that term in the Letter
of Credit.
"RECOVERABLE EXPOSURE" means the Liability of a Lender to return any
amount received
11
by it that constitutes a Recoverable Amount or to pay an amount
equal to or measured by any such amount, and, for this purpose, "Liability"
means any indebtedness, liability, obligation or duty of or binding upon a
Lender or any of its assets, of any kind, nature or description, direct or
indirect, absolute or contingent, due or not due, contractual or tortious,
liquidated or unliquidated, arising under applicable law, whether now existing
or hereafter arising.
"REGULATION D" shall mean Regulation D of the Federal Reserve Board as
from time to time in effect and any successor to all or any portion thereof.
"REPURCHASE AGREEMENT" shall mean that certain Manufacturer's Repurchase
Agreement to which the Borrower and any of its Subsidiaries is a party with one
or more financial institutions in the form heretofore provided to the Agent,
together with any similar agreement with any other vendors providing
transactions substantially similar to the agreement attached as Annex II to the
Existing Credit Agreement (as defined in the BNY Senior Credit Agreement).
"REQUIRED LENDERS" shall mean Lenders holding more than 75% of the
principal amount of Loans outstanding or, if no Loans are outstanding, more than
75% of the Total Commitments, PROVIDED that, for purposes of Sections 3.1 and
8.2, "Required Lenders" shall mean Lenders holding more than 40% of the
principal amount of Loans outstanding or, if no Loans are outstanding, more than
40% of the Total Commitments.
"RESPONSIBLE OFFICER" of any Person shall mean the chief executive
officer, the chief operating officer, the chief financial officer or the general
counsel of such Person.
"RESTRICTED SUBSIDIARIES" shall mean those Subsidiaries of the Borrower
set forth on Schedule 1.1(c) and each Person required to become a Guarantor
pursuant to Section 6.12.
"SECURED PARTIES" has the meaning ascribed to that term in the Security
Agreement.
"SECURED OBLIGATIONS" has the meaning ascribed to that term in the
Security Agreement.
"SECURITY AGREEMENT" shall mean a security agreement substantially in the
form of Exhibit 1.1(d) hereto (as any such security agreement may be amended,
modified or supplemented from time to time).
"SECURITY DOCUMENTS" shall mean and include the Security Agreement, the
Pledge Agreement, the Trademark Security Agreement, the Mortgages and the
Assignments of Rents and Leases.
"SENIOR AGENT" means (a) The Bank of New York, in its capacity as "Agent"
under the BNY Senior Credit Agreement, or any successor thereto as such Agent,
or (b) any Person from time to time acting as "Agent" under any other Senior
Credit Agreement; provided that for purposes of Section 11 the Agent shall not
be required to recognize any Person other than The Bank of New York as a Senior
Agent unless the predecessor Senior Agent and such successor Senior Agent shall
have notified the Agent of the appointment of such successor Senior Agent under
the Senior Credit Agreement.
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"SENIOR CREDIT AGREEMENT" means (a) the BNY Senior Credit Agreement and
(b) any credit agreement entered into in connection with a refinancing of
amounts outstanding under the BNY Senior Credit Agreement, but only if (i) the
maximum principal amount of the credit available thereunder is not more than the
aggregate principal amount of the Total Commitment under (and as defined in) the
BNY Senior Credit Agreement immediately before such refinancing, (ii) the terms
of such credit agreement are no more onerous to the Borrower and its
Subsidiaries than the terms of the BNY Senior Credit Agreement immediately
before such refinancing, and (iii) the lenders under such credit agreement (or
the agent thereunder for such lenders) enter into an intercreditor agreement,
containing terms substantially similar to the terms of the BNY Intercreditor
Agreement; PROVIDED, HOWEVER, that no credit agreement referred to in clause (b)
hereof shall constitute a "Senior Credit Agreement" unless (x) a copy thereof
shall have been furnished to the Agent at least 15 days prior to the execution
thereof and (y) the Agent shall not have advised the Borrower, within 15 days
after the Agent's receipt of such copy, that such credit agreement does not
qualify as a Senior Credit Agreement under the criteria set forth in clause (b)
above and the proviso thereto.
"SENIOR INDEBTEDNESS" means all Indebtedness (including, without
limitation, interest and interest which would have accrued at the rate specified
in the Senior Loan Documents after the filing of a petition initiating any
proceeding under any bankruptcy law but for the commencement of such proceeding
whether or not allowable as a claim in such proceeding) of the Borrower or any
Subsidiary under the Senior Loan Documents.
"SENIOR LOAN DOCUMENTS" means collectively the Senior Credit Agreement
and each note, guaranty, mortgage, pledge agreement, security agreement and
other instrument and document entered into pursuant thereto, in each case (i) as
in effect on the date hereof or on the date the BNY Senior Credit Agreement is
refinanced by such Senior Credit Agreement or (ii) as amended, or which are
entered into, from time to time hereafter or thereafter.
"SOLVENT" as to any Person shall mean that (i) the sum of the assets of
such Person, both at a fair valuation and at present fair salable value, will
exceed its liabilities, including contingent liabilities, (ii) such Person will
have sufficient capital with which to conduct its business as presently
conducted and as proposed to be conducted and (iii) such Person has not incurred
debts, and does not intend to incur debts, beyond its ability to pay such debts
as they mature. For purposes of this definition, "debt" means any liability on
a claim, and "claim" means (x) a right to payment, whether or not such right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured, or unsecured, or (y)
a 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. With respect to any such contingent liabilities, such
liabilities shall be computed at the amount which, in light of all the facts and
circumstances existing at the time, represents the amount which can reasonably
be expected to become an actual or matured liability.
"SUBORDINATED CREDITOR" means the Agent, each Lender and each holder from
time to time of any of the Obligations or of any promissory notes or other
instruments evidencing any of the
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Obligations.
"SUBORDINATED DEBT FINANCING DOCUMENTS" shall mean and include the
Offering Memorandum, the Subordinated Notes Indenture, and the Purchase
Agreement, dated July 12, 1994, among Wertheim Xxxxxxxx & Co. Incorporated, the
Borrower and the "Guarantors" as defined therein.
"SUBORDINATED DEMAND NOTE" shall mean the $25,000,000 demand note dated
March 31, 1994 payable to Xxxxx X. Xxxxxx or any replacement thereof made in
accordance with the terms of the applicable Subordination Agreement.
"SUBORDINATED INDEBTEDNESS" shall mean Indebtedness of the Borrower or a
Guarantor expressly subordinated in right of payment to the Obligations.
"SUBORDINATED NOTE" shall mean a 13.5% Series A Senior Subordinated Note
of the Borrower due 2001.
"SUBORDINATED NOTES INDENTURE" shall mean the Indenture, dated as of July
1, 1994 among the Borrower, the parties listed as "Guarantors" therein and First
Trust National Association, as Trustee.
"SUBORDINATED SHAREHOLDER NOTE" shall mean the $4,104,422.12 shareholder
note dated November 24, 1993 payable to Xxxxx X. Xxxxxx.
"SUBORDINATION AGREEMENTS" shall mean subordination agreements
substantially in the form of Exhibits 1.1(e) (as any such subordination
agreement may be amended, modified or supplemented from time to time).
"SUBSIDIARY" of any Person shall mean and include (i) any corporation 50%
or more 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 directly or
indirectly through Subsidiaries and (ii) any partnership, association, joint
venture or other entity in which such Person, directly or indirectly through
Subsidiaries, is either a general partner or has a 50% or more equity interest
at the time.
"TAXES" shall have the meaning provided in Section 2.17.
"TFC" shall mean Textron Financial Corporation.
"TOTAL COMMITMENT" shall mean, at any time, the sum of the Commitments of
all of the Lenders at such time.
"TRADEMARK SECURITY AGREEMENT" shall mean a trademark security agreement
substantially in the form of Exhibit 1.1(f) hereto (as such trademark security
agreement has been, is being or hereafter may be amended, modified or
supplemented from time to time).
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"TRANSACTION DOCUMENTS" shall mean the Loan Documents and the
Subordinated Debt Financing Documents.
"TRANSACTIONS" shall mean each of the transactions contemplated by the
Transaction Documents.
"TRANSFEREE" shall have the meaning provided in Section 10.4(d)
"TRANSFER SUPPLEMENT" shall have the meaning provided in Section 10.4(c).
"TYPE" shall mean any type of Loan determined with respect to the
interest option applicable thereto, I.E., a Base Rate Loan or a Eurodollar Loan.
SECTION 2 AMOUNT AND TERMS OF CREDIT FACILITY.
Section 2.1 TERM LOAN. (a) Subject to and upon the terms and
conditions hereof, each Lender severally and not jointly agrees to make term
loans (each an "ADVANCE" and collectively the "LOAN") to the Borrower in an
aggregate principal amount not to exceed such Xxxxxx's Commitment. The Total
Commitment is $60,000,000. The Advances will be available to be borrowed on any
Business Day during the period from October 20, 1997 to and including October
23, 1997 (such period, the "BORROWING PERIOD"), provided that in no event shall
there be more than one (1) Borrowing of Advances. The Borrowing of Advances
shall be in the aggregate minimum amount of $1,000,000 or any integral multiple
of $1,000,000 in excess thereof.
(b) The Loans shall be due and payable together with accrued
and unpaid interest in accordance with Section 2.4(d) on the Final Maturity
Date.
(c) The Borrower's obligation to pay the principal of, and
interest on, each Lender's Loan will be evidenced by this Agreement, the records
of such Lender, and a promissory note (a "NOTE") duly executed and delivered by
the Borrower in the form of Exhibit 2.1 hereto in a principal amount equal to
such Xxxxxx's Loan, with blanks appropriately completed in conformity herewith.
Each Note issued to a Lender shall (w) bear interest as provided in Section 2.4,
(x) be payable to the order of such Lender, (y) be dated the initial Borrowing
Date and (z) mature on the Final Maturity Date.
Each Lender is hereby authorized, at its option, either (i) to endorse on
the schedule attached to its Note (or on a continuation of such schedule
attached to such Note and made a part thereof) an appropriate notation
evidencing the date and amount of each Advance and each principal and interest
payment in respect thereof, or (ii) to record such Advance and payments in its
books and records, PROVIDED that the failure of any Lender to make such notation
or any error therein shall not affect the obligation of the Borrower to repay
the Loan made by such Lender in accordance with the terms of this Agreement and
the other Loan Documents. Such schedule or such books and records, as the case
may be, shall constitute prima facie evidence of the accuracy of the information
contained therein.
15
Section 2.2 NOTICE OF BORROWING. (a) When the Borrower desires to
borrow Loans hereunder, it shall give the Agent at the Agent's Office prior to
12:00 noon, New York City time, on the day of a requested Base Rate Loan prior
telex, telecopy or telephonic notice (promptly confirmed in writing) of such
Base Rate Loan, and at least three Business Days' prior telex, telecopy or
telephonic notice (promptly confirmed in writing) of a Eurodollar Loan to be
made hereunder. Any such notice (a "NOTICE OF BORROWING") shall be irrevocable,
be in the form of Exhibit 2.2 and shall specify (i) the aggregate principal
amount of the requested Loans, (ii) the date of Borrowing (which shall be a
Business Day), and (iii) whether such Loans shall consist of Base Rate Loans or
Eurodollar Loans and, if Eurodollar Loans, the initial Interest Period to be
applicable thereto (provided, that no Eurodollar Loans may be requested or made
when any Default or Event of Default has occurred and is continuing).
(b) Promptly after receipt of the Notice of Borrowing, the
Agent shall provide each Lender with a copy thereof and inform each Lender as to
its Pro Rata Share of the Loans requested thereunder.
Section 2.3 DISBURSEMENT OF FUNDS. (a) No later than 1:00 P.M., New
York City time, on the date specified in the Notice of Borrowing, the Lender
will make available the amount of its Advance requested to be made on such date,
in U.S. dollars and immediately available funds, at the Agent's office. After
the Agent's receipt of the proceeds of such Advance, the Agent will make
available to the Borrower by depositing in the Borrower's account at the Agent's
Office the aggregate of the amounts so made available in the type of funds
actually received. After the end of the Borrowing Period, the balance, if any,
of the Commitment of each Lender shall be reduced to zero.
(b) Unless the Agent shall have been notified by any Lender
prior to the date of the Borrowing that such Xxxxxx does not intend to make
available to the Agent its Advance to be made on such date, the Agent may assume
that such Xxxxxx has made such amount available to the Agent on such date and
the Agent in its sole discretion may, 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 Agent by such Lender and the Agent has made
such amount available to the Borrower, the Agent shall be entitled to recover
such corresponding amount on demand from such Lender. If such Lender does not
pay such corresponding amount forthwith upon the Agent's demand therefor, the
Agent shall promptly notify the Borrower and the Borrower shall immediately
repay such corresponding amount to the Agent. The Agent shall also be entitled
to recover from such Lender or the Borrower, as the case may be, interest on
such corresponding amount in respect of each day from the date such
corresponding amount was made available by the Agent to the Borrower to the date
such corresponding amount is recovered by the Agent, at a rate per annum equal
to (i) in the case of the Borrower, the then applicable rate of interest,
calculated in accordance with Section 2.4, for the respective Loans and (ii) in
the case of such Lender, at the Federal Funds Rate until the day three (3)
Business Days from such date and thereafter at the then applicable rate of
interest, calculated in accordance with Section 2.4, for the respective Loans.
Nothing herein shall be deemed to relieve any Lender from its obligation to
fulfill its commitments hereunder or to prejudice any rights which the Borrower
may have against any Lender as a result of any default by such Xxxxxx
xxxxxxxxx. Notwithstanding
16
anything contained herein or in any other Loan Document to the contrary, the
Agent may apply all funds and proceeds of Collateral available for the
payment of any Obligations first to repay any amount owing by any Lender to
the Agent as a result of such Xxxxxx's failure to fund its Loans hereunder.
Section 2.4 INTEREST. (a) The Borrower agrees to pay interest in
respect of the unpaid principal amount of each Base Rate Loan from the date of
the making of such Loan until such Loan shall be paid in full at a rate per
annum which shall be equal to the Alternate Base Rate in effect from time to
time, such rate to change as and when the Alternate Base Rate changes, such
interest to be computed (i) if calculated by reference to the Federal Funds
Rate, on the basis of a 360-day year, and (ii) if calculated by reference to the
Prime Rate, on the basis of a 365- or 366-day year, as applicable.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date of the making of
such Eurodollar Loan until such Eurodollar Loan shall be paid in full at a rate
per annum which shall be equal to the sum of the relevant Eurodollar Rate plus
the Margin Percentage, such interest to be computed on the basis of a 360-day
year.
(c) In the event that, and for so long as, any Event of Default
shall have occurred and be continuing or a Drawing (as defined in a Letter of
Credit) shall have occurred under such Letter of Credit, the outstanding
principal amount of all Loans and, to the extent permitted by law, overdue
interest in respect of all Loans, shall bear interest at a rate per annum (the
"DEFAULT RATE") equal to the sum of two percent (2%) plus the interest rate
otherwise applicable hereunder to such principal amount in effect from time to
time.
(d) Interest on each Loan shall accrue from and including the
date of the Borrowing thereof to but excluding the date of any repayment thereof
and shall be payable (i) in respect of each Base Rate Loan, quarterly in arrears
on each Payment Date, (ii) in respect of each Eurodollar Loan, on the last day
of each Interest Period applicable to such Loan and, in the case of an Interest
Period of six months, on the date occurring three months from the first day of
such Interest Period and on the last day of such Interest Period, and (iii) in
the case of all Loans, on any prepayment or conversion (on the amount prepaid or
converted), at maturity (whether by acceleration or otherwise) and, after such
maturity, on demand.
(e) The Agent shall, upon determining the Eurodollar Rate for
any Interest Period, promptly notify the Borrower and the Lenders thereof.
Section 2.5 INTEREST PERIODS. (a) The Borrower shall, in the Notice
of Borrowing or Notice of Conversion or Continuation in respect of the making
of, conversion into or continuation of a Eurodollar Loan, select the interest
period (each, an "INTEREST PERIOD") applicable to such Eurodollar Loan, which
Interest Period shall, at the option of the Borrower, be either a one-month,
two-month, three-month or six-month period, provided that:
(i) the initial Interest Period for any Eurodollar Loan
shall commence on the date of the making of such Eurodollar Loan
(including the date of any conversion from
17
a Base Rate Loan) and each Interest Period occurring thereafter in
respect of such Eurodollar Loan shall commence on the date on which
the next preceding Interest Period ends;
(ii) if any Interest Period would otherwise end on a day
which is not a Business Day, such Interest Period shall end on the next
succeeding Business Day; PROVIDED, HOWEVER, that if any Interest Period
would otherwise end 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 end on the next preceding Business Day;
(iii) if any Interest Period 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; and
(iv) no Interest Period shall extend beyond the Final
Maturity Date.
(b) If upon the last day of any Interest Period, the Borrower
has failed to elect a new Interest Period to be applicable to the respective
Eurodollar Loan as provided above, the Borrower shall be deemed to have elected
to convert such Eurodollar Loans into Base Rate Loans effective as of the last
day of such current Interest Period.
Section 2.6 MINIMUM AMOUNT OF EURODOLLAR LOANS. All borrowings,
conversions, continuations, payments, prepayments and selection of Interest
Periods hereunder shall be made or selected so that, after giving effect
thereto, (i) the aggregate principal amount of any Borrowing comprised of
Eurodollar Loans shall not be less than $10,000,000 or an integral multiple of
$5,000,000 in excess thereof, and (ii) there shall be no more than six
Borrowings comprised of Eurodollar Loans outstanding at any time.
Section 2.7 CONVERSION OR CONTINUATION. (a) Subject to the other
provisions hereof, the Borrower shall have the option (i) to convert at any time
all or any part of outstanding Base Rate Loans which comprise part of the same
Borrowing to Eurodollar Loans, (ii) to convert all or any part of outstanding
Eurodollar Loans which comprise part of the same Borrowing to Base Rate Loans,
on the last day of the Interest Period applicable thereto, or (iii) to continue
all or any part of outstanding Eurodollar Loans which comprise part of the same
Borrowing as Eurodollar Loans for an additional Interest Period, on the last day
of the Interest Period applicable thereto, PROVIDED that no Loan may be
continued as, or converted into, a Eurodollar Loan when any Default or Event of
Default has occurred and is continuing.
(b) In order to elect to convert or continue a Loan under this
Section 2.7, the Borrower shall deliver an irrevocable notice thereof (a "NOTICE
OF CONVERSION OR CONTINUATION") to the Agent no later than 12:00 noon, New York
City time, (i) at least one Business Day in advance of the proposed conversion
date in the case of a conversion to a Base Rate Loan and (ii) at least three
Business Days in advance of the proposed conversion or continuation date in the
case of a conversion to, or a continuation of, a Eurodollar Loan. A Notice of
Conversion or Continuation shall specify (w) the requested conversion or
continuation date (which shall be a Business Day), (x) the amount of the Loan to
be converted or continued, (y) whether a
18
conversion or continuation is requested, and (z) in the case of a conversion
to, or a continuation of, a Eurodollar Loan, the requested Interest Period.
Promptly after receipt of a Notice of Conversion or Continuation under this
Section 2.7, the Agent shall provide each Lender with a copy thereof.
Section 2.8 VOLUNTARY REDUCTION OF COMMITMENTS. Upon at least three
Business Days' prior irrevocable written notice (or telephonic notice promptly
confirmed in writing) to the Agent (which notice the Agent shall promptly
transmit to each of the Lenders), the Borrower shall have the right, without
premium or penalty, to permanently reduce each Lender's Pro Rata Share of all or
part of the unused Total Commitment, provided that any such partial reduction
shall be in the minimum aggregate amount of $1,000,000 or any integral multiple
of $1,000,000 in excess thereof.
Section 2.9 VOLUNTARY PREPAYMENTS. The Borrower shall have the right
to prepay the Loans in whole or in part from time to time on the following terms
and conditions: (a) the Borrower shall give the Agent written notice (or
telephonic notice promptly confirmed in writing), which notice shall be
irrevocable, of its intent to prepay the Loans at least three Business Days
prior to a prepayment of Eurodollar Loans and at least one Business Day prior to
a prepayment of Base Rate Loans, which notice shall specify the amount of such
prepayment and what Types of Loans are to be prepaid and, in the case of
Eurodollar Loans, the specific Borrowing(s) pursuant to which such Eurodollar
Loan was made, and which notice the Agent shall promptly transmit to each of the
Lenders and (b) each prepayment shall be in an aggregate principal amount of
$1,000,000 or any integral multiple of $1,000,000 in excess thereof. All
prepayments shall be accompanied by accrued interest on the principal amount
being prepaid to but excluding the day of payment. Notwithstanding anything to
the contrary set forth herein, Term Loans, once repaid, may not be reborrowed.
Section 2.10 [This Section deliberately left blank]
Section 2.11 [This Section deliberately left blank]
Section 2.12 METHOD AND PLACE OF PAYMENT. (a) Except as otherwise
specifically provided herein, all payments and prepayments under this Agreement
the Notes shall be made to the Agent for the account of the Lenders entitled
thereto not later than 12:00 noon, New York City time, on the date when due and
shall be made in lawful money of the United States of America in immediately
available funds at the Agent's office, and any funds received by the Agent after
such time shall, for all purposes hereof (including the following sentence), be
deemed to have been paid on the next succeeding Business Day. Except as
otherwise specifically provided herein, the Agent shall thereafter cause to be
distributed on the date of receipt thereof to each Lender in like funds its Pro
Rata Share of payments so received.
(b) 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.
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(c) All payments made by the Borrower hereunder and under the
other Loan Documents shall be made irrespective of, and without any reduction
for, any setoff or counterclaims.
Section 2.13 FEES. (a) The Borrower agrees to pay to the Agent on each
anniversary of the Agreement Date an administrative fee and other fees described
in the letter agreement dated October 17, 1997 between the Borrower and the
Agent, which fees shall be non-refundable.
(b) The Borrower agrees to pay to the Agent for the account
of each Lender a commitment fee, computed at the per annum rate of 0.15%, in
each case on the basis of a 360-day year for the actual number of days
elapsed, payable on the average daily unused portion of the Commitment of
such Xxxxxx, from and including the day next succeeding the Agreement Date to
the date of the Advances hereunder, payable on the date of such Advances.
Section 2.14 INTEREST RATE UNASCERTAINABLE, INCREASED COSTS,
ILLEGALITY. (a) In the event that the Agent, in the case of clause (i)
below, or any Lender, in the case of clauses (ii) and (iii) below, shall have
determined (which determination shall, absent manifest error, be final and
conclusive and binding upon all parties hereto):
(i) on any date for determining the Eurodollar Rate for any
Interest Period, 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 the Eurodollar Rate; or
(ii) at any time, that the relevant Eurodollar Rate applicable
to any of its Eurodollar Loans shall not represent the effective pricing
to such Lender for funding or maintaining a Eurodollar Loan, or such
Lender shall incur increased costs or reductions in the amounts received
or receivable hereunder in respect of any Eurodollar Loan (other than by
reason of a tax, or an increased tax, on the net income of such Lender),
in any such case because of (x) any change since the date of this
Agreement in any applicable law or governmental rule, regulation,
guideline or order or any interpretation thereof and including the
introduction of any new law or governmental rule, regulation, guideline
or order (such as for example but not limited to 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), whether or not having the force of law and whether or
not failure to comply therewith would be unlawful, and/or (y) other
circumstances affecting such Lender or the interbank Eurodollar market or
the position of such Lender in such market; or
(iii) at any time, that the making or continuance by it of any
Eurodollar Loan has become unlawful by compliance by such Lender in good
faith with any law or governmental rule, regulation, guideline or order
(whether or not having the force of law and whether or not failure to
comply therewith would be unlawful) or has become impracticable as a
result of a contingency occurring after the date of this Agreement which
materially and adversely affects the interbank Eurodollar market;
20
then, and in any such event, the Agent or such Lender shall, promptly after
making such determination, give notice (by telephone promptly confirmed in
writing) to the Borrower and (if applicable) the Agent of such determination
(which notice the Agent shall promptly transmit to each of the other Lenders).
Thereafter (x) in the case of clause (i) above, the Borrower's right to request
Eurodollar Loans shall be suspended, and any Notice of Borrowing or Notice of
Conversion or Continuation given by the Borrower with respect to any Borrowing
of Eurodollar Loans which has not yet been made shall be deemed cancelled and
rescinded by the Borrower, (y) in the case of clause (ii) above, the Borrower
shall pay to such Lender, upon such Xxxxxx's delivery of written demand therefor
to the Borrower with a copy to the Agent, such additional amounts (in the form
of an increased rate of interest, or a different method of calculating interest,
or otherwise, as such Lender in its sole discretion exercised in a professional
manner shall determine) as shall be required to compensate such Lender for such
increased costs or reduction in amounts received or receivable hereunder and (z)
in the case of clause (iii) above, the Borrower shall take one of the actions
specified in clause (b) below as promptly as possible and, in any event, within
the time period required by law. The written demand provided for in clause (y)
shall, absent manifest error, be final and conclusive and binding upon all of
the parties hereto.
(b) In the case of any Eurodollar Loan or requested Eurodollar
Loan affected by the circumstances described in clause (a)(ii) above, the
Borrower may, and in the case of any Eurodollar Loan affected by the
circumstances described in clause (a)(iii) above the Borrower shall, either (i)
if any such Eurodollar Loan has not yet been made but is then the subject of a
Notice of Borrowing or a Notice of Conversion or Continuation, be deemed to be a
request for a Base Rate Loan with respect to the affected Lender, or (ii) if any
such Eurodollar Loan is then outstanding, require the affected Lender to convert
each such Eurodollar Loan into a Base Rate Loan at the end of the applicable
Interest Period or such earlier time as may be required by law, in each case by
giving the Agent notice (by telephone promptly confirmed in writing) thereof on
the Business Day that the Borrower was notified by the Lender pursuant to clause
(a) above; PROVIDED, HOWEVER, that all Lenders whose Eurodollar Loans are
affected by the circumstances described in clause (a) above shall be treated in
the same manner under this clause (b).
(c) In the event that the Agent determines at any time
following its giving of notice based on the conditions described in clause
(a)(i) above that none of such conditions exist, the Agent shall promptly give
notice thereof to the Borrower and the Lenders, whereupon the Borrower's right
to request Eurodollar Loans from the Lenders and the Lenders' obligation to make
Eurodollar Loans shall be restored.
(d) In the event that a Lender determines at any time following
its giving of a notice based on the conditions described in clause (a)(iii)
above that none of such conditions exist, such Lender shall promptly give notice
thereof to the Borrower and the Agent, whereupon the Borrower's right to request
Eurodollar Loans from such Lender and such Lender's obligation to make
Eurodollar Loans shall be restored.
Section 2.15 FUNDING LOSSES. The Borrower shall compensate each Lender,
upon such Xxxxxx's delivery of a written demand therefor to the Borrower, with a
copy to the Agent (which demand shall, absent manifest error, be final and
conclusive and binding upon all of the parties
21
hereto), for all reasonable losses, expenses and liabilities (including,
without limitation, any loss, expense or liability incurred by such Lender in
connection with the liquidation or reemployment of deposits or funds required
by it to make or carry its Eurodollar Loans) that such Lender sustains or may
sustain: (i) if for any reason (other than a default by such Lender) a
Borrowing of, or conversion from or into, or a continuation of, Eurodollar
Loans does not occur on a date specified therefor in a Notice of Borrowing or
Notice of Conversion or Continuation (whether or not rescinded, cancelled or
withdrawn or deemed rescinded, cancelled or withdrawn, pursuant to Section
2.14(a) or 2.14(b) or otherwise), (ii) if any repayment (including, without
limitation, payment after acceleration) or conversion of any of its
Eurodollar Loans occurs on a date which is not the last day of the Interest
Period applicable 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 any default by the Borrower in
repaying its Eurodollar Loans or any other amounts owing hereunder in respect
of its Eurodollar Loans when required by the terms of this Agreement.
Calculation of all amounts payable to a Lender under this Section 2.15 shall
be made on the assumption that such Lender has funded its relevant Eurodollar
Loan through the purchase of a Eurodollar deposit bearing interest at the
Eurodollar Rate in an amount equal to the amount of such Eurodollar Loan with
a maturity equivalent to the Interest Period applicable to such Eurodollar
Loan, and through the transfer of such Eurodollar deposit from an offshore
office of such Lender to a domestic office of such Lender in the United
States of America, provided that each Lender may fund its urodollar Loans in
any manner that it in its sole discretion chooses and the foregoing
assumption shall only be made in order to calculate amounts payable under
this Section 2.15. Such compensation may include an amount equal to the
excess, if any, of (i) the amount of interest which would have accrued on the
amount so prepaid, or not so borrowed, converted or continued, for the period
from the date of such prepayment or of such failure to borrow, convert or
continue to the last day of such Interest Period (or, in the case of a
failure to borrow, convert or continue, the interest Period that would have
commenced on the date of such failure) in each case at the applicable rate of
interest for such Loans provided for herein over (ii) the amount of interest
(as reasonably determined by such Lender) which would have accrued to such
Lender on such amount by placing such amount on deposit for a comparable
period with leading banks in the interbank eurodollar market.
Section 2.16 INCREASED CAPITAL. If any Lender shall have determined
that compliance with any applicable law, rule, regulation, guideline, request or
directive (whether or not having the force of law) of any governmental
authority, central bank or comparable agency (other than by reason of a tax or
an increased tax, on the net income of such Lender), has or would have the
effect of reducing the rate of return on the capital or assets of such Lender,
or any Person Controlling such Lender, as a consequence of its commitments or
obligations hereunder, then from time to time, upon such Xxxxxx's delivering a
written demand therefor to the Agent and the Borrower, the Borrower shall pay to
such Lender such additional amount or amounts as will compensate such Lender for
such reduction.
Section 2.17 TAXES. (a) All payments made by the Borrower under this
Agreement shall be made free and clear of, and without reduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any
22
governmental authority excluding, in the case of the Agent and each Lender,
net income and franchise taxes imposed on the Agent or such Lender by the
jurisdiction under the laws of which the Agent or such Lender is organized or
any political subdivision or taxing authority thereof or therein, or by any
jurisdiction in which such Lender's Domestic Lending office or Eurodollar
Lending Office, as the case may be, is located or any political subdivision
or taxing authority thereof or therein or by reason of such Xxxxxx's failure
to comply with Section 2.17(b) hereof (all such non-excluded taxes, levies,
imposts, deductions, charges or withholdings being hereinafter called
"TAXES"). If any Taxes are required to be withheld from any amounts payable
to the Agent or any Lender hereunder or under the Notes, the amounts so
payable to the Agent or such Lender shall be increased to the extent
necessary to yield to the Agent or such Lender (after payment of all Taxes)
interest or any such other amounts payable hereunder at the rates or in the
amounts specified in this Agreement and the Notes. Whenever any Taxes are
payable by the Borrower, as promptly as possible thereafter, the Borrower
shall send to the Agent for its own account or for the account of such Lender
a certified copy of an original official receipt received by the Borrower
showing payment thereof or other evidence thereof reasonably satisfactory to
the Agent. If the Borrower fails to pay any Taxes when due to the appropriate
taxing authority or fails to remit to the Agent the required receipts or
other documentary evidence, the Borrower shall indemnify the Agent and the
Lenders for any incremental taxes, interest or penalties that may become
payable by the Agent or any Lender as a result of any such failure. The
agreements in this Section 2.17 shall survive the termination of this
Agreement and the payment of the Notes and all other Obligations.
(b) Each Lender that is not incorporated under the laws of the
United States of America or a state thereof (including each Purchasing Lender
that becomes a party to this Agreement pursuant to Section 10.4(c)) agrees that,
prior to the first date on which any payment is due to it hereunder, it will
deliver to the Borrower and the Agent (i) two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224 or successor applicable form,
as the case may be, certifying in each case that such Lender is entitled to
receive payments under this Agreement and the Notes payable to it, without
deduction or withholding of any United States Federal income taxes, and (ii) an
Internal Revenue Service Form W-8 or W-9 or successor applicable form, as the
case may be, to establish an exemption from United States backup withholding
tax. Each Lender which delivers to the Borrower and the Agent a Form 1001 or
4224 and Form W-8 or W-9 pursuant to the preceding sentence further undertakes
to deliver to the Borrower and the Agent two further copies of the said letter
and Form 1001 or 4224 and Form W-8 or W-9, or successor applicable forms, or
other manner of certification, as the case may be, on or before the date that
any such letter or form expires or becomes obsolete or after the occurrence of
any event requiring a change in the most recent letter and form previously
delivered by it to the Borrower, and such extensions or renewals thereof as may
reasonably be requested by the Borrower, certifying in the case of a Form 1001
or 4224 that such Lender is entitled to receive payments under this Agreement
without deduction or withholding of any United States Federal income taxes,
unless there has been a change in law (including, without limitation, any change
in treaty, statute, regulation or official interpretation) prior to the date on
which any such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such letter or form with respect to it and such Lender advises
the Borrower that it is not capable of receiving
23
payments without any deduction or withholding of United States Federal income
tax, and in the case of a Form W-8 or W-9, establishing an exemption from
United States backup withholding tax.
Section 2.18 CHANGE OF OFFICE, ETC. Any of the Agent or any Lender
claiming any additional amounts payable pursuant to Sections 2.14(a)(iii) or
2.17 shall use reasonable efforts (consistent with legal and regulatory
restrictions) (including reasonable efforts to change the jurisdiction of its
applicable lending office) to avoid the need for or reduce the amount of any
such additional amounts that may thereafter accrue, provided that such efforts
would not, in the sole determination of such Lender or the Agent, as the case
may be, be otherwise disadvantageous to such Lender or the Agent.
Section 2.19 USE OF PROCEEDS. The proceeds of the Loans shall be used
solely by the Borrower to finance the repurchase of up to $75,000,000 aggregate
principal amount of the Borrower's Subordinated Notes, including payment of
consent and other fees and related expenses.
SECTION 3 LETTERS OF CREDIT.
Section 3.1 DRAWING UNDER LETTERS OF CREDIT. Upon occurrence of a
Drawing Event, the Agent may, and upon the instruction of the Required Lenders
shall, draw under the Letters of Credit. Such drawings shall be made under each
Letter of Credit PRO RATA on the basis of the relative undrawn amounts thereof.
The Agent shall promptly notify each Lender of a drawing under the Letters of
Credit.
Section 3.2 CASH COLLATERAL. Drawings under the Letters of Credit that
are on account of Recoverable Amounts shall be deposited by the Agent in the
Collateral Account to be held in accordance with the Collateral Account
Agreements.
Section 3.3 INSTRUMENTS OF ASSIGNMENT. Each Lender hereby authorizes
the Agent to execute and deliver, in its name and on its behalf, an Instrument
of Assignment and to execute and deliver Collateral Account Agreements.
Section 3.4 REPLACEMENT OF LETTERS OF CREDIT. Upon the request of the
Borrower, the Agent shall accept (a) at any time following 120 days after any
prepayment of the Loans, one or more replacement or amended Letters of Credit
with an aggregate drawable amount reasonably acceptable to the Agent but in any
event no less than the outstanding principal amount of the Loan, together with
interest accruing for a six-month period computed on the basis used for the
Letters of Credit issued on the Agreement Date and (b) any replacement Letter of
Credit with an aggregate drawable amount equal to the original Letter of Credit
that is being replaced by such replacement Letter of Credit, PROVIDED that, in
each case, such replacement Letter of Credit is issued by a Person acceptable at
the time of issuance to all Lenders. The Agent agrees that, upon receipt of a
replacement Letter of Credit in accordance herewith, it will promptly surrender
the original Letter of Credit that is being replaced.
24
SECTION 4 CONDITIONS PRECEDENT.
Section 4.1 CONDITIONS PRECEDENT TO INITIAL ADVANCES. The obligation
of each Lender to make its initial Advance is subject to the determination of
each Lender, in its sole and absolute discretion, that each of the following
conditions has been fulfilled:
(a) the Agent shall have received each of the following, in
form and substance and, in the case of the materials referred to in clauses (i)
and (v), certified in a manner satisfactory to the Agent:
(i) a certificate of the Secretary or an Assistant
Secretary of each Loan Party, dated the requested date for the making
of such Advance, certifying (1) the names and true signatures of the
incumbent offices of such Person authorized to sign the applicable Loan
Documents, (2) the resolutions of such Person's Board of Directors
approving and authorizing the execution, delivery and performance of
all Loan Documents executed by such Person, (3) that there have been
no changes in the by-laws of such Person since March 27, 1996, except
as otherwise set forth in such certificate, and, to the extent of any
such changes, a copy thereof and (4) that there have been no changes
in the certificate of incorporation of such Person since March 27, 1996,
except as otherwise set forth in such certificate, and, to the extent of
any such changes, a copy thereof certified by the Secretary of State of
incorporation of such Loan Party;
(ii) a legal opinion, dated the requested date for the
making of such Advance, from Xxxx, Gotshal & Xxxxxx LLP, special New York
counsel to the Loan Parties;
(iii) a legal opinion, dated the requested date for the
making of such Advance, from Xxxx XxXxxxxxx, general counsel of the
Borrower;
(iv) a legal opinion of counsel for the Agent, dated the
requested date for the making of such Advance;
(v) a copy of each Governmental Approval listed on
Schedule 5.10;
(vi) a duly executed Note for each Lender;
(vii) a duly executed copy of the Guaranties;
(viii) a duly executed copy of the Security Documents;
(ix) a duly executed copy of the BNY Intercreditor
Agreement;
(x) such instruments and other documents as the Agent
may request, the possession of which is necessary or appropriate in the
Agent's determination to create or perfect a security interest in the
Collateral under Applicable Law; and
25
(xi) evidence that fees payable on or prior to the
requested date of such Advance, and all amounts payable pursuant to
Section 10.1 for which invoices have been delivered to the Borrower on or
prior to such date, have been paid in full or will be paid in full
concurrently with the disbursement of the proceeds of the Advances to be
made on such date.
(b) Letters of Credit with total drawable amount of at least
$63,135,000 shall have been duly issued and delivered to the Agent.
(c) Subordinated Notes of at least $62,500,000 principal amount
shall have been accepted for purchase by the Borrower and shall be repurchased
with the proceeds of the Loans.
(d) Schedule 4.1(d) shall list any present or contingent
environmental liability or potential Environmental Claim to which either the
Borrower or any of its Subsidiaries is subject to which could reasonably be
expected to have a Material Adverse Effect of which the Lenders shall not have
been notified pursuant to the BNY Senior Credit Agreement.
Section 4.2 CONDITIONS TO EACH ADVANCE. The obligation of each Lender
to make each Advance requested to be made by it, including its initial Advance,
is subject to the determination of such Lender, in its sole and absolute
discretion, that each of the following conditions has been fulfilled:
(a) the Agent shall have received a Notice of Borrowing with
respect to such Advance complying with the requirements of Section 2.2;
(b) each representation and warranty made or deemed made under
any Loan Document shall be true and correct at and as of the time such Advance
is to be made, both with and without giving effect to such Advance and all other
Advances to be made at such time and to the application of the proceeds thereof;
(c) no Default shall have occurred and be continuing at the
time such Advance is to be made or would result from the making of such Advance
and all other Advances to be made at such time or from the application of the
proceeds thereof;
(d) such Lender shall have received such information as it may
have requested pursuant to Section 6.1(o); and
(e) such Advance will not contravene any Applicable Law
applicable to such Lender.
Except to the extent that the Borrower shall have disclosed in the notice
of borrowing, or in a subsequent notice given to the Lenders prior to 5:00 p.m.
on the Business Day before the requested date for the making of the requested
Advances, that a condition specified in clause (b) or (c) above will not be
fulfilled as of the requested time for the making of such Advances, the Borrower
shall be deemed to have made a representation and warranty as of the time of the
making of such Advances that the conditions specified in such clauses have been
fulfilled as of
26
such time. No such disclosure by the Borrower that a condition specified in
clause (b) or (c) above will not be fulfilled as of the requested time for
the making of the requested Advances shall affect the right of each Lender to
not make the Advances requested to be made by it if, in such Xxxxxx's
determination, such condition has not been fulfilled at such time.
Section 4.3 METHOD OF DELIVERY. All of the Notes, if any,
certificates, agreements, legal opinions and other documents and papers referred
to in this Section 4, unless otherwise specified, shall be delivered to the
Agent for the account of each of the Lenders and, except for the Notes, if any,
in sufficient counterparts for each of the Lenders, and shall be satisfactory in
form and substance to each Lender in its sole discretion.
SECTION 5 REPRESENTATIONS AND WARRANTIES.
In order to induce the Lenders to enter into this Agreement and to make
the Loan, the Borrower makes the following representations and warranties,
which shall survive the execution and delivery of this Agreement and the Notes
and the making of Loan:
Section 5.1 CORPORATE STATUS. Each Loan Party (i) is a duly organized
and validly existing corporation in good standing under the laws of the
jurisdiction of its incorporation, (ii) has the corporate power and authority to
own its property and assets and to transact the business in which it is engaged
or presently proposes to engage and (iii) except where the failure to do so
would not, in the aggregate, result in a Material Adverse Effect, has duly
qualified and is authorized to do business and is in good standing as a foreign
corporation in every jurisdiction in which it owns or leases real property or in
which the nature of its business requires it to be so qualified.
Section 5.2 CORPORATE POWER AND AUTHORITY. Each Loan Party has the
corporate power and authority to execute, deliver and carry out the terms and
provisions of each of the Transaction Documents to which it is a party and has
taken all necessary corporate action to authorize the execution, delivery and
performance by it of such Transaction Documents. Each Loan Party has duly
executed and delivered each of the Transaction Documents to which it is party,
and each such Transaction Document constitutes its legal, valid and binding
obligation, enforceable in accordance with its terms.
Section 5.3 NO VIOLATION. Neither the execution, delivery or
performance by any Loan Party of the Transaction Documents to which it is a
party, nor compliance by it with the terms and provisions thereof nor the
consummation of the Transactions, (i) will contravene any applicable provision
of any law, statute, rule, regulation, order, writ, injunction or decree of any
court or governmental instrumentality or (ii) will conflict or be inconsistent
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 any Loan Party
pursuant to the terms of any indenture, mortgage, deed of trust, agreement or
other instrument to which such Loan Party is a party or by which it or any of
its property or assets is bound or to
27
which it may be subject, or (iii) will violate any provision of the
certificate of incorporation or by-laws of any Loan Party.
Section 5.4 LITIGATION. There are no actions, suits or proceedings
pending or, to the best knowledge of the Borrower, threatened (i) with respect
to any of the Transactions or Transaction Documents or (ii) that could,
individually or in the aggregate, result in a Material Adverse Effect.
Section 5.5 FINANCIAL STATEMENTS; FINANCIAL CONDITION; ETC. The
internally prepared financial statements of the Borrower and its Subsidiaries
dated as of August 31, 1997 (the "INTERNAL FINANCIALS") delivered to the Agent
and the Lenders in connection with this Agreement were prepared in accordance
with GAAP consistently applied and fairly present the financial condition and
the results of operations of the entities covered thereby on the dates and for
the periods covered thereby and subject to normally recurring year-end
adjustments. No Loan Party has any material liability (contingent or otherwise)
other than those reflected on the Internal Financials or as set forth on
Schedule 5.5.
Section 5.6 SOLVENCY. On the Agreement Date and after and giving
effect to the Transactions, (x) the Borrower and (y) the Borrower and its
Subsidiaries, on a consolidated basis, will be Solvent.
Section 5.7 [This Section deliberately left blank]
Section 5.8 MATERIAL ADVERSE CHANGE. Since the date of the most recent
audited consolidated financial statements of the Borrower dated June 30, 1997,
there has occurred no event, act or condition which has or could have resulted
in a Material Adverse Effect.
Section 5.9 USE OF PROCEEDS; MARGIN REGULATIONS. All proceeds of Loan
will be used by the Borrower only in accordance with the provisions of Section
2.19. No part of the proceeds of the Loan will be used by the Borrower to
purchase or carry any Margin Stock or to extend credit to others 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 Regulations G, T, U or X of the Federal Reserve Board.
Section 5.10 GOVERNMENTAL APPROVALS. No order, consent, approval,
license, authorization, or validation of, or filing, recording or registration
with, or exemption by, any governmental or public body or authority, or any
subdivision thereof (a "Governmental Approval"), is required to authorize, or is
required in connection with (i) the execution, delivery and performance of any
Transaction Document or the consummation of any of the Transactions or (ii) the
legality, validity, binding effect or enforceability of any Transaction
Document, except (x) those listed on Schedule 5.10 that have already been duly
made or obtained and remain in full force and effect and (y) filings necessary
to perfect the security interests granted or to be granted by the Security
Documents.
Section 5.11 SECURITY INTERESTS AND LIENS. The Security Documents
create, or, in the case of the Mortgages and the Assignments of Rents and
Leases, will create, as security for the
28
Secured Obligations, valid and enforceable security interests in and Liens on
all of the Collateral, and subject to no other Liens other than Liens
permitted pursuant to Section 7.2(a), (b), (c), (d) or (e).
Section 5.12 TAX RETURNS AND PAYMENTS. Each Loan Party has filed all
tax returns required to be filed by it and has paid all taxes and assessments
payable by it which have become due other than those not yet delinquent or those
that are adequately reserved against in accordance with GAAP which are being
diligently contested in good faith by appropriate proceedings.
Section 5.13 [This Section deliberately left blank]
Section 5.14 INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING COMPANY
ACT. Neither the Borrower nor any of its Subsidiaries is (x) an "investment
company" or a company "controlled" by an "investment company," within the
meaning of the Investment Company Act of 1940, as amended, (y) a "holding
company" or a "subsidiary company" of a "holding company" or an "affiliate"
of either a "holding company" or a "subsidiary company" within the meaning of
the Public Utility Holding Company Act of 1935, as amended, or (z) subject to
any other Federal or state law or regulation which purports to restrict or
regulate its ability to borrow money.
Section 5.15 REPRESENTATIONS AND WARRANTIES IN TRANSACTION DOCUMENTS.
All representations and warranties made by any Loan Party in the Transaction
Documents (other than the Loan Documents) are true and correct in all material
respects. None of such representations and warranties are inconsistent in any
material respect with the representations and warranties of any Loan Party made
herein or in any other Loan Document.
Section 5.16 TRUE AND COMPLETE DISCLOSURE; FINANCIAL STATEMENTS. All
factual information (taken as a whole) furnished by or on behalf of any Loan
Party in writing to the Agent or any Lender for purposes of or in connection
with this Agreement or any of the Transactions is true and accurate in all
material respects on the date as of which such information is dated or furnished
and not incomplete by omitting to state any material fact necessary to make such
information (taken as a whole) not misleading at such time. All of the
financial statements of the Borrower and its Subsidiaries furnished by or on
behalf of any Loan Party to the Agent or any Lender for purposes of or in
connection with the Transactions were prepared in accordance with GAAP and
fairly present the financial condition and results of operations of the
appropriate Loan Parties at the dates and for the periods respectively covered
thereby. As of the Agreement Date, there are no facts, events or conditions
known to the Borrower which, individually or in the aggregate, have or could be
expected to have a Material Adverse Effect.
Section 5.17 CORPORATE STRUCTURE; CAPITALIZATION. Schedule 5.17 hereto
sets forth the number of authorized and issued shares of capital stock of the
Borrower and each of its Subsidiaries, the par value thereof and the registered
owner(s) thereof. All of such stock has been duly and validly issued and is
fully paid and non-assessable. Neither any Loan Party nor any such Subsidiary
has outstanding any securities convertible into or exchangeable for its capital
stock nor does any Loan Party or any such Subsidiary have outstanding any
rights to
29
subscribe for or to purchase, or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock.
Section 5.18 [This Section deliberately left blank.]
Section 5.19 [This Section deliberately left blank.]
Section 5.20 PATENTS, TRADEMARKS, ETC. Each of the Loan Parties has
obtained and holds in full force and effect, free from burdensome restrictions,
all patents, trademarks, servicemarks, trade names, copyrights and other such
rights, in each case which are necessary for the operation of its business as
presently conducted. No product, process, method, substance, part or other
material presently manufactured by any Loan Party in connection with such
business infringes any patent, trademark, service mark, trade name, copyright,
license or other right owned by any other Person, which infringement could
result in a Material Adverse Effect. There is not pending or overtly threatened
any claim or litigation against or affecting any Loan Party contesting its right
to sell or use any such product, process, method, substance, part or other
material.
Section 5.21 OWNERSHIP OF PROPERTY. (a) Schedule 5.21(a)(i) sets forth
all the real property owned or leased by the Loan Parties and used or held for
use in connection with the business of the Loan Parties and identifies the
street address (or a legal description of such property), the current owner (and
current record owner, if different) and whether such property is leased or
owned. The Loan Parties have good and marketable fee simple title to or valid
and subsisting leasehold interests in all of such real property free and clear
of all liens, claims, encumbrances, restrictions, rights of way, easements,
encroachments and charges or adverse claims or interests of any nature other
than Liens permitted by Section 7.2, and good and valid title to all of their
personal property other than such immaterial real property set forth on Schedule
5.21(a)(ii) subject to no Lien of any kind except Liens permitted hereby. The
Loan Parties enjoy peaceful and undisturbed possession under all of their
respective leases.
(b) Except as set forth on Schedule 5.21(b), all buildings,
structures, heating and air conditioning equipment, plumbing, electrical and
other mechanical systems and equipment and the roofs, walls and other structural
components included in the Properties are in good operating condition and repair
(normal wear and tear excepted), do not require any material repairs and are
adequate for the uses for which they are currently utilized and comply in all
material respects with all applicable laws, building, fire, health and safety
codes, ordinances and zoning rules and zoning ordinances. There are no pending
or, to the Loan Parties' knowledge, threatened material suits, actions or
proceedings, including, without limitation, condemnation or eminent domain
proceedings, affecting the Mortgaged Property or any part thereof.
(c) Except as otherwise disclosed to the Agent, to the best
knowledge of the Borrower, based on the Flood Hazard Certificates prepared by
the Central Flood Hazard Agency, none of the Properties are located in a flood
hazard area as defined by the Federal Insurance Administration.
30
(d) Except as disclosed in the surveys or title insurance
policies delivered to the lenders under the BNY Senior Credit Agreement, all
Improvements comprising a portion of any Property lie wholly within the boundary
and building restriction lines of such Property and no improvements on adjoining
properties encroach upon any Property.
Section 5.22 NO DEFAULT. No Loan Party is in default under or with
respect to any Transaction Document or any other agreement, instrument or
undertaking to which it is a party or by which it or any of its property is
bound in any respect which could result in a Material Adverse Effect. No
Default or Event of Default exists.
Section 5.23 LICENSES, ETC. The Loan Parties have obtained and hold in
full force and effect, all franchises, licenses, permits, certificates,
authorizations, qualifications, accreditations, easements, rights of way and
other rights, consents and approvals which are necessary for the operation of
their respective businesses as presently conducted.
Section 5.24 COMPLIANCE WITH LAW. Each Loan Party is in compliance with
all laws, rules, regulations, orders, judgments, writs and decrees other than
such non-compliance which, individually or in the aggregate, could not have a
Material Adverse Effect.
Section 5.25 NO BURDENSOME RESTRICTIONS. No Loan Party is a party to
any agreement or instrument or subject to any other obligation or any charter or
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, could have a Material Adverse Effect.
Section 5.26 [This Section deliberately left blank].
Section 5.27 LABOR MATTERS. There is no presently existing dispute or
controversy between the Borrower or any of its Subsidiaries and any of their
respective employees which has had or is likely to have, and the Borrower has no
reason to believe that the relationship of the Borrower and its Subsidiaries
with their unions or employees is likely to have, a Material Adverse Effect.
The Borrower and each of its Subsidiaries are in compliance in all material
respect with all federal and state laws with respect to non-discrimination in
employment and the payment of wages.
SECTION 6 AFFIRMATIVE COVENANTS.
The Borrower covenants and agrees that on and after the Agreement Date
and until the Total Commitment has terminated and the Obligations are paid in
full:
Section 6.1 INFORMATION COVENANTS. The Borrower will furnish to the
Agent and each Lender:
(a) ANNUAL FINANCIAL STATEMENTS. Within 120 days after the
close of each fiscal year of the Borrower, the consolidated and consolidating
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal
year and the related consolidated and consolidating statements of income and
consolidated cash flow and retained earnings for such fiscal year
31
setting forth comparative figures for the preceding fiscal year disclosing
all loss contingencies of a type requiring disclosure under standards
promulgated by FASB and, with respect to such consolidated financial
statements, audited by Xxxxxx Xxxxxxxx & Co. or other independent certified
public accountants of recognized national standing reasonably acceptable to
the Required Lenders, and accompanied by an opinion of such accountants
(which shall not be qualified) to the effect that such consolidated financial
statements fairly present the financial condition and result of operations of
the Borrower and its Subsidiaries on a consolidated basis in accordance with
GAAP consistently applied.
(b) QUARTERLY FINANCIAL STATEMENTS. Within 60 days after the
close of each quarterly accounting period in each fiscal year of the Borrower,
the consolidated and consolidating balance sheet of the Borrower and its
Subsidiaries as at the end of such quarterly period and the related consolidated
and consolidating statements of income and consolidated cash flow and retained
earnings for such quarterly period and for the elapsed portion of the fiscal
year ended with the last day of such quarterly period disclosing all material
changes in loss contingencies of a type requiring disclosure under standards
promulgated by FASB, in each case setting forth comparative figures for the
related periods in the prior fiscal year and accompanied by a certificate of the
chief financial officer of the Borrower which certifies that such consolidated
financial statements fairly present the financial condition and result of
operations of the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied, subject to normal year-end
adjustments.
(c) [This Section deliberately left blank].
(d) MANAGEMENT LETTERS. Promptly after the Borrower's receipt
thereof, a copy of any "management letter" or other material report received by
the Borrower from its certified public accountants.
(e) FINANCIAL PROJECTIONS. Within 90 days after the first day
of each fiscal year of the Borrower, commencing with the fiscal year beginning
July 1, 1998, a financial forecast of results of operations and sources and uses
of cash (in the form of the projections provided to the Agent and the Lenders in
connection with this Agreement) prepared by the Borrower for the period
extending through the quarterly period ending with June 30, 2001, accompanied by
a written statement of the assumptions used in connection therewith, together
with a certificate of the chief financial officer of the Borrower to the effect
that such budget and financial forecast and assumptions, taken as a whole, are
reasonable and represent the Borrower's good faith estimate of its future
financial requirements and performance. The financial statements required to be
delivered pursuant to clauses (a), (b) and (c) above shall be accompanied by a
comparison of the actual financial results set forth in such financial
statements to those contained in the forecasts delivered pursuant to this clause
(e) together, upon request of the Agent or any Lender, with an explanation of
any material variations from the results anticipated in such forecasts.
(f) CERTIFICATES. At the time of the delivery of the financial
statements under clauses (a) and (b) above, a certificate of the accounting firm
or the chief financial officer of the Borrower which opines or certifies with
respect to such financial statements that after due
32
investigation and reasonable inquiry, no Default or Event of Default has
occurred during the period commencing at the beginning of the accounting
period covered by the financial statements accompanied by such certificate
and ending on the date of such certificate or, if any Default or Event of
Default has occurred, specifying the nature and extent thereof and, if
continuing, the action the Borrower proposes to take in respect thereof.
(g) NOTICE OF DEFAULT OR LITIGATION. Promptly and in any event
within ten (10) Business Days after any Loan Party obtains knowledge thereof,
notice of (i) the occurrence of any Default or Event of Default, (ii) any
litigation or governmental proceeding pending or threatened against the Borrower
or any or its Subsidiaries which could result in a Material Adverse Effect and
(iii) any other event, act or condition which could result in a Material Adverse
Effect.
(h) [This Section deliberately left blank].
(i) SEC FILINGS. Promptly upon transmission thereof, copies of
all regular and periodic financial information, proxy materials and other
information and reports, if any, which any Loan Party shall file with the
Securities and Exchange Commission or any governmental agencies substituted
therefor or which any Loan Party shall send to its stockholders.
(j) [This Section deliberately left blank]
(k) REFINANCINGS. No later than ten (10) Business Days prior
to any extension, refinancing or refunding of Indebtedness pursuant to Section
7.1(b), shall deliver to the Agent copies of the documentation relating to such
extension, refinancing or refunding together with such other information related
thereto as the Agent may reasonably request.
(l) CHARTER DOCUMENTS. No later than ten (10) Business
Days prior to any change therein, the proposed changes to the certificate of
incorporation or the by-laws of the Borrower or any of its Subsidiaries.
(m) NOTICE OF DISSOLUTION. Promptly upon any dissolution of a
Designated Subsidiary, notice thereof.
(n) [This Section deliberately left blank.]
(o) OTHER INFORMATION. From time to time, such other
information or documents (financial or otherwise) as the Agent or any Lender may
reasonably request.
Section 6.2 BOOKS, RECORDS AND INSPECTIONS. The Borrower shall, and
shall cause each of its Subsidiaries to, keep proper books of record and account
in which full, true and correct entries in conformity with GAAP and all
requirements of law shall be made of all dealings and transactions in relation
to its business and activities. The Borrower shall, and shall cause each of its
Subsidiaries to, permit officers and designated representatives of the Agent or
any Lender to visit and inspect any of the properties of the Borrower or any of
its Subsidiaries, and to examine the books of record and account of the Borrower
or any of its Subsidiaries, and discuss the
33
affairs, finances and accounts of the Borrower or any of its Subsidiaries
with, and be advised as to the same by, its and their officers and
independent accountants, all upon reasonable notice to the Borrower and at
such reasonable times as the Agent or such Lender may desire.
Section 6.3 MAINTENANCE OF INSURANCE. The Borrower shall, and shall
cause each of its Subsidiaries to, (a) maintain with financially sound and
reputable insurance companies insurance on itself and its properties in at least
such amounts and against at least such risks as are customarily insured against
in the same general area by companies engaged in the same or a similar business,
which insurance shall in any event not provide for materially less coverage than
the insurance in effect on the Original Effective Date (as defined in the BNY
Senior Credit Agreement) and (b) furnish to the Agent and each Lender from time
to time, upon written request, the policies under which such insurance is
issued, certificates of insurance and such other information relating to such
insurance as the Agent or such Lender may request.
Section 6.4 TAXES. (a) The Borrower shall pay or cause to be paid,
and shall cause each of its Subsidiaries to pay or cause to be paid, prior to
becoming past due, all taxes, charges and assessments and all other lawful
claims required to be paid by the Borrower or such Subsidiaries, except as
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves have been
(b) Except to the extent required by applicable law, the
Borrower shall not, and shall not permit any of its Subsidiaries to, file or
consent to the filing of any consolidated, combined or unitary tax return with
any Person (other than the Borrower and/or its Subsidiaries).
Section 6.5 CORPORATE FRANCHISES. The Borrower shall, and shall 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 patents,
trademarks, servicemarks, tradenames, copyrights, franchises, licenses, permits,
certificates, authorizations, qualifications, accreditations, easements, rights
of way and other rights, consents and approvals other than those which (a) the
board of directors of the Borrower has determined that the preservation thereof
is no longer desirable in the conduct of the Borrower and its Subsidiaries taken
as a whole and (b) individually or in the aggregate, could not have a Material
Adverse Effect.
Section 6.6 COMPLIANCE WITH LAW. The Borrower shall, and shall cause
each of its Subsidiaries to, comply in all material respects with all applicable
laws, rules, statutes, regulations, decrees and orders of, and all applicable
restrictions imposed by, all governmental bodies, domestic or foreign, in
respect of the conduct of their business and the ownership of their property,
including, without limitation, all Environmental Laws, other than those which,
individually or in the aggregate, could not have a Material Adverse Effect.
Section 6.7 PERFORMANCE OF OBLIGATIONS. The Borrower shall, and
shall cause each of its Subsidiaries to, perform all of its obligations in
all material respects under the terms of each mortgage, indenture, security
agreement, debt instrument, lease, undertaking and contract by which it or
any of its properties is bound or to which it is a party except where such
non-performance could not have a Material Adverse Effect and shall perform
all of its obligations to
34
make payment when due of all amounts payable pursuant to the Subordinated
Debt Financing Documents to the extent permitted by the subordination terms
thereof.
Section 6.8 MAINTENANCE OF PROPERTIES. The Borrower shall, and shall
cause each of its Subsidiaries to, ensure that its properties used or useful in
its business are kept in good repair, working order and condition, normal wear
and tear excepted, and make all repairs, renewals, replacements, additions,
betterments and improvements thereto, as shall be reasonable necessary for the
proper conduct of the Borrower and its subsidiaries taken as a whole.
Section 6.9 LICENSES, PERMITS, ETC. The Borrower shall obtain and
maintain in full force and effect, or cause each of its Subsidiaries on behalf
of the Borrower and its Subsidiaries to obtain and maintain in full force and
effect, all licenses, permits, governmental approvals, franchises,
authorizations or other rights necessary for the operation of its respective
business; and notify the Agent in writing, promptly after any Loan Party learns
thereof, of the suspension, cancellation, revocation or discontinuance of or any
pending or threatened action or proceeding seeking to suspend, cancel, revoke or
discontinue any such license, permit, governmental approval, franchise
authorization or right.
Section 6.10 ENVIRONMENTAL REPORTS. Upon the reasonable written request
by the Agent, the Borrower shall promptly submit to the Agent and the Lenders a
report providing an update of the status of each environmental, health or safety
compliance, hazard or liability issue identified in any notice or report
required pursuant to Section 6.1(j) above and any other environmental, health
and safety compliance obligation, remedial obligation or liability that could
have a Material Adverse Effect.
Section 6.11 APPRAISALS. Within ninety (90) days after a request by the
Agent, the Borrower shall deliver to the Agent appraisals of the Mortgaged
Property in the event that the Agent determines such appraisals are required by
applicable law (including, without limitation, the regulations promulgated under
the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as
amended), which appraisals shall be in form and substance satisfactory to the
Agent, and conducted by appraisers selected or approved by the Agent.
Section 6.12 ADDITIONAL GUARANTORS. If (i) any Person becomes a
Subsidiary of the Borrower after the Agreement Date, (ii) the Borrower or any
Subsidiary of the Borrower that is a Guarantor transfers or causes to be
transferred, in one transaction or a series of related transactions, property or
assets (including, without limitation, businesses, divisions, real property,
assets or equipment) which in the aggregate have a value equal to or greater
than the lesser of $1,000,000 and 5% of the Borrower's total assets determined
on a consolidated basis as of the time of transfer to any Subsidiary or
Subsidiaries of the Borrower that is not a Guarantor or are not Guarantors
(other than AMF Insurance Company of Bermuda Ltd.), or (iii) any Subsidiary
(other than AMF Insurance Company of Bermuda Ltd.) of the Borrower which is not
a Guarantor has a value equal to or greater than the lesser of $1,000,000 and 5%
of the Borrower's total assets determined on a consolidated basis as of the time
of determination, the Borrower shall cause such Subsidiary or Subsidiaries to
execute and deliver to the Agent an
35
agreement to become a Guarantor in the form of Annex B to the Guaranty and
such other documents, including Security Documents, as the Agent shall
require.
Section 6.13 AMF INSURANCE COMPANY OF BERMUDA LTD. As of March 31,
1997, the principal asset of AMF Insurance Company of Bermuda Ltd. is a
promissory note from Minstar, Inc. in the amount of $3,000,000. The Borrower
shall cause that neither it nor any of its Subsidiaries make any other loan,
advance, investment or payment of any kind whatsoever to, nor incur or permit to
exist any other obligation, contingent or otherwise, to or on behalf of, AMF
Insurance Company of Bermuda Ltd., other than (i) payments on such promissory
note to meet insurance claims payable by AMF Insurance Company of Bermuda Ltd.
as they are due, (ii) additional payments with respect to the operating expenses
of AMF Insurance Company of Bermuda Ltd. in an aggregate yearly amount not to
exceed $100,000 and (iii) reimbursement of fees paid by AMF Insurance Company of
Bermuda Ltd. with respect to letters of credit with an aggregate face amount
outstanding at any time not to exceed $3,285,000.
Section 6.14 COVENANT TO GIVE SECURITY. The Borrower shall deliver to
the Agent within sixty (60) days following the date hereof, at the expense of
Xxxxxxxx, (a) duly executed mortgages and deeds of trust encumbering the
Mortgaged Property and an Assignment of Rents and Leases in form and substance
satisfactory to the Agent, securing payment of all the Obligations of the
Borrower and the Guarantors under the Loan Documents and constituting Liens on
all such properties, and (b)(i) the Borrower's written instructions to Chicago
Title Insurance Company (or other title insurance company satisfactory to the
Agent and the Lenders) authorizing the recordation of such mortgages and deeds
of trust and Assignment of Rents and Leases in the appropriate real estate
records of the applicable jurisdiction in which each and every Mortgaged
Property is located and (ii) evidence (including, without limitation, payment
instructions given by the Borrower) that all mortgage or intangible taxes or
recording charges required to be paid in connection with the execution, delivery
or recording of the mortgages and deeds of trust and Assignment of Rents and
Leases. The Borrower shall, and shall cause each of its Subsidiaries to, take
whatever action (including, without limitation, the recording of mortgages, the
filing of Uniform Commercial Code financing statements, the giving of notices
and the endorsement of notices on title documents) may be reasonably necessary
or advisable in the opinion of the Agent to vest in the Agent (or in any
representative of the Agent designated by it) valid and subsisting Liens on the
properties purported to be subject to the mortgagee or deeds of trust and
Assignment of Rents and Leases, as applicable, delivered pursuant to Section
6.14, enforceable against all third parties in accordance with their terms.
Section 6.15 COVENANT TO PROVIDE CERTIFICATE OF INSURANCE. The Borrower
shall deliver to the Agent within ten (10) days following the date hereof, at
the expense of the Borrower, a certificate of insurance demonstrating insurance
coverage in respect of each of the Loan Parties of types, in amounts, with
insurers and with other terms satisfactory to the Lenders, which certificate
shall indicate that the Agent and the Lenders are named additional insured as
their interests may appear and shall contain a lenders loss payee endorsement in
favor of the Agent in form and substance satisfactory to the Agent.
36
Section 6.16 COVENANT TO PROVIDE FINANCING STATEMENTS. The Borrower
shall deliver to the Agent within six (6) days following the date hereof such
duly executed UCC-1 financing statements and other documents as the Agent may
request, the filing or recordation of which is necessary or appropriate in the
Agent's determination to create or perfect a security interest in the Collateral
under applicable law.
Section 6.17 COVENANT TO PROVIDE SUBORDINATION AGREEMENTS. The Borrower
shall deliver to the Agent within forty-five (45) days following the date hereof
duly executed copies of the Subordination Agreements.
SECTION 7 NEGATIVE COVENANTS.
The Borrower covenants and agrees that on and after the Agreement Date
until the earlier of (a) the termination of the Total Commitment and the payment
in full of the Obligations and (b) (i) with respect to any Lender (other than
First Bank), the delivery of the Instrument of Assignment to the Issuing Banks,
and (ii) with respect to First Bank, if at such time First Bank is an Issuing
Bank and a lender under the BNY Senior Credit Agreement with a Commitment (as
defined therein) in excess of $10,000,000 (or, if the Commitments shall have
been terminated, with Loans outstanding thereunder in a like principal amount),
the delivery of an instrument of transfer, as referred to in Section
10.4(c)(ii), by First Bank to the Person for whose account the Letter of Credit
was issued by First Bank:
Section 7.1 INDEBTEDNESS. The Borrower shall not, and shall not permit
any of its Subsidiaries to, create, incur, assume, suffer to exist or otherwise
become or remain directly or indirectly liable with respect to, any
Indebtedness, other than:
(a) Indebtedness hereunder and under the other Loan Documents and
under the BNY Senior Credit Agreement and the Guaranties (as defined in the BNY
Senior Credit Agreement);
(b) Indebtedness outstanding on the Agreement Date and set forth
on Schedule 7.1 hereto and any extension, refinancing or refunding thereof;
PROVIDED that (i) the principal amount of the Indebtedness so extended,
refinanced or refunded shall not be increased above the principal amount thereof
outstanding immediately prior to such extension, refinancing or refunding, (ii)
the final maturity of the Indebtedness so extended, refinanced or refunded shall
not be changed to an earlier date, (iii) the amortization schedule shall not be
changed in a manner which results in a shorter average life to maturity, and
(iv) the terms (financial and otherwise) of such extension, refinancing or
refunding shall not be less favorable to the Borrower or its Subsidiary, as the
case may be;
(c) Indebtedness incurred pursuant to the Subordinated Debt
Financing Documents;
(d) [Intentionally Omitted];
(e) Contingent Obligations not otherwise prohibited hereunder;
37
(f) Indebtedness with respect to Capital Leases and other
purchase money Indebtedness, in each case incurred to finance Capital
Expenditures, not in excess of $30,000,000 in the aggregate at any one time
outstanding, PROVIDED that any such Indebtedness shall not exceed the lesser of
the purchase price or the initial fair market value of the asset so financed;
(g) in the case of the Borrower, Indebtedness to any of the
Restricted Subsidiaries and, in the case of any Subsidiary (other than AMF
Insurance Company of Bermuda Ltd.), Indebtedness to the Borrower or any of the
Restricted Subsidiaries (but only so long as such indebtedness is held by the
Borrower or a Restricted Subsidiary);
(h) Indebtedness of the Borrower in respect of Hedging Agreements
entered into with one or more Lenders (as defined in the BNY Senior Credit
Agreement) on terms and conditions satisfactory to the Agent; and
(i) Indebtedness of Minstar, Inc. to AMF Insurance Company of
Bermuda, Ltd., described in Section 6.13.
Section 7.2 LIENS. The Borrower shall not, and shall not permit any of
its Subsidiaries to, create, incur, assume or suffer to exist, directly or
indirectly, any Lien on any of its property now owned or hereafter acquired,
other than:
(a) Liens existing on the Agreement Date and set forth on
Schedule 7.2 hereto ("Permitted Liens");
(b) Liens for taxes not yet due or which are being contested in
good faith by appropriate proceedings diligently conducted and with respect to
which adequate reserves are being maintained in accordance with GAAP;
(c) Statutory Liens of landlords, carriers, warehousemen,
mechanics, materialmen and other Liens imposed by law (other than any Lien
imposed by XXXXX or an Environmental Lien) created in the ordinary course of
business for amounts not yet due or which are being contested in good faith by
appropriate proceedings diligently conducted and with respect to which adequate
bonds have been posted;
(d) Liens (other than any Lien imposed by ERISA or an
Environmental Lien) incurred or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security, or to secure the performance of tenders, statutory
obligations, surety and appeal bonds, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations (exclusive
of obligations for the payment of borrowed money);
(e) Easements, rights-of-way, zoning and similar restrictions
and other similar charges or encumbrances of record listed in Schedule B II of
the title insurance policies issued by the Title Company to the Agent in
connection with the Original Agreement (as defined in the BNY Senior Credit
Agreement) and other such charges or encumbrances not interfering with the
ordinary conduct of the business of the Borrower or any of its Subsidiaries and
which do not
38
detract materially from the value of the property to which they attach or
impair materially the use thereof by the Borrower or any of its Subsidiaries
or materially adversely affect the security interests of the Agent or the
Lenders therein;
(f) Liens granted to the Agent for the benefit of the Lenders
pursuant to the Security Documents securing the Obligations and Liens securing
the BNY Senior Credit Agreement and the Guaranties (as defined in the BNY Senior
Credit Agreement);
(g) Liens created pursuant to Capital Leases and to secure
other purchase-money Indebtedness permitted pursuant to Section 7.1(f), PROVIDED
that such Liens are only in respect of the property or assets subject to, and
secure only, the respective Capital Lease or other purchase-money Indebtedness
and attach within sixty (60) days of the construction or acquisition of such
property or asset; and
(h) Liens securing progress payments made by customers of the
Hatteras Yacht division (i) for yachts of at least 50 feet in length with a
price of no less than $500,000, (ii) so long as the amount of the progress
payments at all times exceeds or is approximately comparable to the cost of time
and materials then completed on such yacht, and (iii) such Lien is solely on the
yacht for which such progress payments were made and does not extend to any
other asset or property of any Loan Party.
Section 7.3 RESTRICTION ON FUNDAMENTAL CHANGES. (a) The Borrower
shall not, and shall not permit any of its Subsidiaries to, in a single
transaction or through a series of related transactions, enter into any merger
or consolidation, or liquidate, wind-up or dissolve (or suffer any liquidation
or dissolution), discontinue its business or convey, lease, sell, transfer or
otherwise dispose of, in one transaction or series of transactions, all or any
substantial part of its business or property, whether now or hereafter acquired,
except (i) dispositions of assets or property not otherwise expressly prohibited
hereunder, including any dispositions permitted under the BNY Senior Credit
Agreement and (ii) any direct or indirect wholly-owned Subsidiary of the
Borrower may merge into or convey, sell, lease or transfer all or substantially
all of its assets to, the Borrower or any other direct or indirect wholly-owned
Subsidiary of the Borrower in a transaction in which no Person other than the
Borrower or its direct or indirect wholly-owned Subsidiaries receives any
consideration, PROVIDED that immediately following such transaction, the Agent
shall have a perfected security interest in all of the assets and properties
which were Collateral prior to such transaction, and such security interest in
such Collateral (other than the stock of a corporation which was not a survivor
of a merger) shall be of the same priority (subject to the BNY Intercreditor
Agreement) as existed prior to such transaction, and the survivor of such
transaction shall execute and deliver any Security Documents requested by the
Agent, and (ii) pursuant to any Permitted Organizational Changes, PROVIDED that
(x) no Permitted Organizational Change shall take place during the continuance
of a Default or an Event of Default, and (y) prior to the occurrence of any
Permitted Organizational Change, the Borrower shall deliver to the Agent an
officer's certificate in the form of Exhibit 7.3(a).
(b) Except as set forth in Section 7.7, the Borrower shall not,
and shall not permit any of its Subsidiaries to, (i) acquire by purchase or
otherwise any property or assets of,
39
or stock or other evidence of beneficial ownership of, any Person, except
purchases of inventory, equipment, materials and supplies in the ordinary
course of the Borrower's or such Subsidiary's business, (ii) during the
continuance of any Default or Event of Default, create any Subsidiary, or
(iii) enter into any partnership or joint venture, except in the case of
(iii), as permitted by the BNY Senior Credit Agreement.
(c) Borrower shall not, and shall not permit any of its
Subsidiaries to, amend its certificate of incorporation or by-laws, PROVIDED
that so long as no Default or Event of Default has occurred and is continuing,
the Borrower and its Subsidiaries may make changes to their respective
certificates of incorporation and bylaws other than those changes which,
individually or in the aggregate, could have a Material Adverse Effect.
Section 7.4 [This Section deliberately left blank.]
Section 7.5 [This Section deliberately left blank.]
Section 7.6 DIVIDENDS. The Borrower shall not, and shall not permit
any of its Subsidiaries to, declare or pay any dividends (other than dividends
payable solely in common stock), or return any capital to, its stockholders or
authorize or make any other distribution, payment or delivery of property or
cash to its stockholders as such, or redeem, retire, purchase or otherwise
acquire, directly or indirectly, any shares of any class of its capital stock
now or hereafter outstanding (or any options or warrants issued with respect to
its capital stock), or set aside any funds for any of the foregoing purposes
(all the foregoing "DIVIDENDS"), except that Dividends may be made to the
Borrower or any of its Subsidiaries by any of its wholly-owned Subsidiaries.
Section 7.7 ADVANCES AND INVESTMENTS. The Borrower shall not, and
shall not permit any of its Subsidiaries to, lend money or credit or make
advances to, any Person, or directly or indirectly purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to any Person, except that the following shall be
permitted:
(a) accounts receivable owned by the Borrower and its
Subsidiaries, if created in the ordinary course of the business of the Borrower
and its Subsidiaries and payable or dischargeable in accordance with customary
trade terms;
(b) loans and advances to the Borrower by any of its
Subsidiaries and capital contributions by the Borrower or any Subsidiary to any
Restricted Subsidiary;
(c) investments existing as of the Agreement Date and set forth
on Schedule 7.7 hereto;
(d) investments pursuant to any Permitted Organizational
Changes, PROVIDED that (x) no Permitted Organizational Change shall take place
during the continuance of a Default or an Event of Default, and (y) prior to the
occurrence of any Permitted Organizational Change, the Borrower shall deliver to
the Agent an officer's certificate in the form of Exhibit 7.3(a);
40
(e) Contingent Obligations not otherwise prohibited hereunder;
(f) promissory notes received in connection with sales of
assets of the Borrower or its Subsidiaries sold, PROVIDED that such promissory
notes are secured with the assets so sold;
(g) [Intentionally omitted];
(h) up to an aggregate investment of $10,000,000 in connection
with minority interests in foreign companies, joint ventures or partnerships on
terms acceptable to the Agent and the Required Lenders;
(i) [Intentionally omitted];
(j) loans to directors and employees of the Borrower or its
Subsidiaries in an aggregate amount outstanding at any time not to exceed
$2,000,000;
(k) the Borrower and its Subsidiaries may acquire and hold Cash
Equivalents;
(l) recourse on account of a Dealer Account Transaction to the
Borrower or any of its Subsidiaries;
(m) [Intentionally omitted]; and
(n) the Recourse Obligations of the Borrower and its
Subsidiaries in connection with the Floor Plan Financing pursuant to the terms
of a Repurchase Agreement, provided that the Recourse Obligations shall not
exceed an aggregate amount of $15,000,000 for any annual period of July 1
through June 30, of which an aggregate amount not to exceed $10,000,000 during
each such annual period may constitute obligations on the part of the Borrower
and its Subsidiaries to repurchase goods which were financed by the financial
institution providing such financing pursuant to the Floor Plan Financing and an
aggregate amount not to exceed $5,000,000 during each such annual period may
constitute indemnity payments by the Borrower and its Subsidiaries relating to
losses incurred by such financial institution resulting from such financial
institution's financing or refinancing of goods to dealers.
Section 7.8 TRANSACTIONS WITH AFFILIATES. Borrower shall not, directly
or indirectly, enter into any transaction or series of related transactions with
or for the benefit of any of its Affiliates, except on an arm's-length basis
and, except for sales of Inventory in the ordinary course of business, (x)(i) in
the case of any such transactions in which the aggregate rental value,
remuneration or other consideration (including the value of a loan) together
with the aggregate rental value, remuneration or other consideration (including
the value of a loan) of all such other transactions consummated in the year
during which such transaction is proposed to be consummated, exceeds $500,000,
the board of directors and the independent directors of the Borrower that are
disinterested, each have (by a majority vote) determined in good faith that the
aggregate rental value, remuneration or other consideration (including the value
of any loan) inuring to the benefit of such Affiliates from any such transaction
is not greater than that which would be charged to or extended by the Borrower
or its Subsidiary, as the case may be, on an
41
arm's-length basis for similar properties, assets, rights, goods or services
by or to a Person not affiliated with the Borrower or its Subsidiaries, as
the case may be, and (ii) in the case of any such transaction in which the
aggregate rental value, remuneration or other consideration (including the
value of any loan), together with the aggregate rental value, remuneration or
other consideration (including the value of any loan) of all such other
transactions consummated in the year during which such transaction proposed
to be consummated, exceeds $5,000,000, the board of directors of the Borrower
and the independent directors of the Borrower that are disinterested (each a
majority vote), and a nationally recognized investment banking firm,
unaffiliated with the Borrower and the Affiliate which is party to such
transaction has determined that the aggregate rental price, remuneration or
other consideration (including the value of a loan) inuring to the benefit of
such Affiliate from any such transaction is not greater than that which would
be charged to or extended by the Borrower or its Subsidiary, as the case may
be, on an arm's-length basis for similar properties, assets, rights, goods or
services by or to a Person not affiliated with the Borrower or its
Subsidiaries, as the case may be, and that (y) in the case of all such
transactions referred to in clauses (x)(i) and (ii) are entered into in good
faith. Any transaction required to be approved by independent directors
pursuant to this Section shall be approved by at least one such independent
director, PROVIDED that the foregoing restrictions shall not apply to the
payment of an annual fee to Xxxxxx Management Corporation for rendering of
management consulting and financial services to the Borrower and its
Subsidiaries in an aggregate amount not in excess of $5,000,000 and except
for repurchases of the Subordinated Notes from Affiliates at par or less than
par.
Section 7.9 LIMITATION ON VOLUNTARY PAYMENTS AND MODIFICATIONS OF
CERTAIN DOCUMENTS. The Borrower shall not, and shall not permit any of its
Subsidiaries to, (a) make any sinking fund payment or voluntary or optional
payment or prepayment on or redemption or acquisition for value of
(including, without limitation, by way of depositing with the trustee with
respect thereto money or securities before due for the purpose of paying when
due) or exchange of any Existing Note or make any payment in respect of any
Existing Note (including, without limitation, payments in respect of options
to repurchase any Existing Note), or (b) amend, modify or waive, or permit
the amendment, modification or waiver of, any provision of any Existing Note.
Section 7.10 CHANGES IN BUSINESS. The Borrower shall not, and shall
not permit any of its Subsidiaries to, engage in any business other than the
manufacturing or selling of pleasure boats or in lines of business reasonably
related thereto.
Section 7.11 CERTAIN RESTRICTIONS. The Borrower shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly, create or
otherwise cause or suffer to exist or become effective any consensual
encumbrance or restriction, or enter into any agreement (other than the BNY
Senior Credit Agreement and the Transaction Documents as in effect on the
Agreement Date), which restricts the ability of the Borrower or any of its
Subsidiaries to (a) enter into amendments, modifications or waivers of the
Loan Documents, (b) sell, transfer or otherwise dispose of its assets, (c)
create, incur, assume or suffer to exist any Lien upon any of its property,
(d) create, incur, assume, suffer to exist or otherwise become liable with
respect to any Indebtedness, or (e) pay any Dividend, provided that Capital
Leases or agreements governing
42
purchase money Indebtedness which contain restrictions of the types referred
to in clauses (b) or (c) with respect to the property covered thereby shall
be permitted.
Section 7.12 LEASE PAYMENTS. The Borrower shall not, and shall not
permit any of its Subsidiaries to, incur, assume or suffer to exist, any
obligation for payments under Capital Leases and operating leases whether for
real or personal or mixed property (including, without limitation, rental
payments and payments of taxes thereunder), except that the Borrower and its
Subsidiaries may incur rental payment obligations not to exceed $15,000,000
in the aggregate during each fiscal year of the Borrower.
Section 7.13 SALES AND LEASEBACKS. From and after the date hereof,
the Borrower shall not, and shall not permit any of its Subsidiaries to,
become liable, directly or indirectly, with respect to any lease (other than
any such lease entered into in connection with a sale of any real property
permitted hereunder, which lease is necessary or desirable to wind down the
operations of such property so sold), whether an operating lease or a Capital
Lease, of any property (whether real or personal or mixed) whether now owned
or hereafter acquired, (i) which the Borrower or such Subsidiary has sold or
transferred or is to sell or transfer to the purchaser thereof, or (ii) which
the Borrower or such Subsidiary intends to use for substantially the same
purposes as any other property which has been or is to be sold or transferred
by the Borrower or such Subsidiary to the purchaser thereof in connection
with such Lease.
Section 7.14 [This Section deliberately left blank.]
Section 7.15 [This Section deliberately left blank.]
Section 7.16 [This Section deliberately left blank.]
Section 7.17 INACTIVE SUBSIDIARIES. The Borrower shall not permit
any of the Designated Subsidiaries from owning or acquiring any property or
assets other than such property or assets owned as of the Agreement Date,
PROVIDED that the Permitted Organizational Changes shall be permitted.
SECTION 8 EVENTS OF DEFAULT.
Section 8.1 EVENTS OF DEFAULT. Each of the following events, acts,
occurrences or conditions shall constitute an Event of Default under this
Agreement, regardless of whether such event, act, occurrence or condition is
voluntary or involuntary or results from the operation of law or pursuant to
or as a result of compliance by any Person with any judgment, decree, order,
rule or regulation of any court or administrative or governmental body:
(a) FAILURE TO MAKE PAYMENTS. The Borrower shall (i)
default in the payment when due of any principal of the Loans or (ii) default
and such default shall continue unremedied for ten (10) or more Business
Days, in the payment when due of any interest on the Loans or in the payment
when due of any Fees or any other amounts owing hereunder.
43
(b) BREACH OF REPRESENTATION OR WARRANTY. Any
representation or warranty made by any Loan Party herein or in any other Loan
Document or in any certificate or statement delivered pursuant hereto or
thereto shall prove to be false or misleading on the date as of which made or
deemed made.
(c) BREACH OF COVENANTS.
(i) The Borrower shall fail to perform or observe any
agreement, covenant or obligation arising under Sections 6.1(g), 6.5,
6.12, 6.14, 6.15, 6.16, 6.17 or 7.1 through 7.17, inclusive.
(ii) The Borrower shall fail to perform or observe any
agreement, covenant or obligation arising under this Agreement (except
those described in subsections (a), (b) and (c)(i) above), and such
failure shall continue for 45 days.
(iii) Any Loan Party shall fail to perform or observe any
agreement, covenant or obligation arising under any provision of the Loan
Documents other than this Agreement, which failure shall continue after
the end of the applicable grace period, if any, provided therein.
(d) ACCELERATION UNDER OTHER AGREEMENTS. Any Event of
Default under and as defined in the Senior Credit Agreement shall have
occurred or the Borrower or any of its Subsidiaries shall default in the
performance or observance of any obligation or condition with respect to any
Indebtedness (other than the Obligations and the Senior Indebtedness) in the
aggregate principal amount in excess of $500,000 or any other event shall
occur or condition exist, if the effect of such Event of Default, default,
event or condition is to accelerate the maturity of any such Indebtedness or
to permit (without regard to any required notice or lapse of time) the holder
or holders thereof, or any trustee or agent for such holders, to accelerate
the maturity of any such Indebtedness, or any such Indebtedness shall become
or be declared to be due and payable prior to its stated maturity other than
as a result of a regularly scheduled payment.
(e) BANKRUPTCY, ETC. (i) Any Loan Party shall commence a
voluntary case concerning itself under the Bankruptcy Code; or (ii) an
involuntary case is commenced against any Loan Party and the petition is not
controverted within 10 days, or is not dismissed within 60 days, after
commencement of the case; or (iii) a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of any Loan Party or any Loan Party commences any other proceedings
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 any Loan Party or there is
commenced against any Loan Party any such proceeding which remains
undismissed for a period of 60 days; or (iv) any order of relief or other
order approving any such case or proceeding is entered; or (v) any Loan Party
is adjudicated insolvent or bankrupt; or (vi) any Loan Party 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
(vii) any Loan Party makes a general assignment for the benefit of creditors;
or (viii) any Loan Party shall fail to pay, or shall state that
44
it is unable to pay, or shall be unable to pay, its debts generally as they
become due; or (ix) any Loan Party shall call a meeting of its creditors with
a view to arranging a composition or adjustment of its debts; or (x) any Loan
Party shall by any act or failure to act consent to, approve of or acquiesce
in any of the foregoing; or (xi) any corporate action is taken by any Loan
Party for the purpose of effecting any of the foregoing.
(f) SUBORDINATED DEBT FINANCING DOCUMENTS. The Borrower or
any of its Subsidiaries (i) does not pay when due (x) whether at maturity,
upon redemption or otherwise, any payment of principal, or premium, due under
any Subordinated Debt Financing Document or (y) any interest due under any
Subordinated Debt Financing Document, and such interest remain unpaid for a
period of thirty (30) days, or (ii) denies or disaffirms any of its
obligations under any Subordinated Debt Financing Document.
(g) RESTRICTED SUBSIDIARIES. Any Person becomes a
"Restricted Subsidiary", as such term is defined in the Subordinated Debt
Financing Documents, unless such Person is also a Guarantor.
(h) LETTERS OF CREDIT; COLLATERAL ACCOUNT AGREEMENTS. Any
Issuing Bank or any Person for whose account a Letter of Credit has been
issued, or any Affiliate of any such Issuing Bank or Person, shall assert, or
any Person institutes any proceeding seeking to establish, that any Letter of
Credit or any provision of any thereof is invalid, not binding or
unenforceable.
(i) [This Section deliberately left blank.]
(j) SECURITY DOCUMENTS. Any of the Security Documents shall
for any reason cease to be in full force and effect, or shall cease to give
the Agent the Liens, rights, powers and privileges purported to be created
thereby (subject to the terms of the BNY Intercreditor Agreement) including,
without limitation, a perfected security interest in, and Lien on, all of the
Collateral in accordance with the terms thereof other than as a result of a
release of Collateral by the Agent pursuant to the terms of this Agreement
and the Security Documents.
(k) GUARANTY. Any Guaranty or any provision thereof shall
cease to be in full force and effect, or the Guarantor or any Person acting
by or on behalf of the Guarantor shall deny or disaffirm all or any portion
of the Guarantor's obligations under such Guaranty.
(l) CHANGE OF CONTROL. (i) Xx. Xxxxx X. Xxxxxx (or,
upon his death, his estate) and his Affiliates shall cease to beneficially
own and control at least 90% of the number of shares of any class of capital
stock of the Borrower entitled (without regard to the occurrence of any
contingency) to vote for the election of members of the board of directors of
the Borrower owned by Xx. Xxxxxx (or, upon his death, his estate) and his
Affiliates on the Original Effective Date (as defined in the BNY Senior
Credit Agreement), (ii) Xx. Xxxxx X. Xxxxxx (or, upon his death, his estate)
and his Affiliates, Xx. Xxxx X. Xxxxxx (or, upon his death, his estate) and
his Affiliates and RDV Capital Management X.X.XX and its Affiliates shall in
the aggregate cease to beneficially own and control at least 50.1%, of the
issued and outstanding shares of each class of capital stock of the Borrower
entitled (without regard to the occurrence of any contingency) to vote for
the
45
election of members of the board of directors of the Borrower, or (iii) a
"Change of Control" as defined in the Subordinated Debt Financing Documents
shall occur.
(m) JUDGMENTS. One or more judgments or decrees in an
aggregate amount (i) in excess of $1,000,000 shall be entered by a court or
courts of competent jurisdiction against the Loan Parties (other than any
judgment as to which, and only to the extent, a reputable insurance company
has acknowledged coverage of such claim in writing) and (x) any such
judgments or decrees shall not be stayed, discharged, paid, bonded or vacated
within 30 days or (y) enforcement proceedings shall be commenced by any
creditor on any such judgments or decrees or (ii) in excess of $5,000,000 and
such judgment or judgments shall not be stayed, discharged or bonded within
60 days.
(n) [This Section deliberately left blank.]
(o) USE OF PROCEEDS. The Borrower shall use the proceeds of
any Loan for a purpose other than that set forth in Section 2.19.
Section 8.2 RIGHTS AND REMEDIES. Upon the occurrence of any Event
of Default described in Section 8.1(e), the Commitments shall automatically
and immediately terminate and the unpaid principal amount of and any and all
accrued interest on the Loan and any and all accrued Fees and other
Obligations shall automatically become immediately due and payable, with all
additional interest from time to time accrued thereon and without
presentation, demand, or protest or other requirements of any kind
(including, without limitation, valuation and appraisement, diligence,
presentment, notice of intent to demand or accelerate and notice of
acceleration), all of which are hereby expressly waived by the Borrower, and
the obligation of each Lender to make any Advances hereunder shall thereupon
terminate; and upon the occurrence and during the continuance of any other
Event of Default, the Agent shall at the request, or may with the consent, of
the Required Lenders, by written notice to the Borrower, (i) declare that the
Commitments are terminated, whereupon the Commitments and the obligation of
each Lender to make any Advances hereunder shall immediately terminate, (ii)
declare the unpaid principal amount of and any and all accrued and unpaid
interest on the Loan any and all accrued Fees and other Obligations to be,
and the same shall thereupon be, immediately due and payable with all
additional interest from time to time accrued thereon and without
presentation, demand, or protest or other requirements of any kind
(including, without limitation, valuation and appraisement, diligence,
presentment, notice of intent to demand or accelerate and notice of
acceleration), all of which are hereby expressly waived by the Borrower, and
(iii) exercise any remedies available under any Loan Document or otherwise.
SECTION 9 THE AGENT.
Section 9.1 APPOINTMENT. Each Lender hereby irrevocably designates
and appoints The Bank of New York as the agent and representative (within the
meaning of Section 9-105(m) of the Uniform Commercial Code) of such Lender
under this Agreement and each other Loan Document, and each such Lender
irrevocably authorizes The Bank of New York as the Agent for such Lender to
execute and deliver and perform its obligations under the BNY Intercreditor
46
Agreement and each Collateral Account Agreement, to take such action on its
behalf under the provisions of this Agreement and each other Loan Document
and to exercise such powers and perform such duties as are expressly
delegated to the Agent by the terms of this Agreement and each other Loan
Document, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement or in the other Loan Documents, the Agent shall not have any duties
or responsibilities, except those expressly set forth herein or in the other
Loan Documents, or any fiduciary relationship with any Lender, and no implied
covenants, functions, responsibilities, duties, obligations or liabilities on
the part of the Agent shall be read into this Agreement or in the other Loan
Documents or otherwise exist against the Agent. The provisions of this
Section 9 are solely for the benefit of the Agent and the Lenders and no Loan
Party shall have any rights as a third party beneficiary or otherwise under
any of the provisions hereof. In performing its functions and duties
hereunder and under the other Loan Documents, the Agent shall act solely as
the agent and representative of the Lenders and does not assume nor shall be
deemed to have assumed any obligation or relationship of trust or agency with
or for any Loan Party or any of their respective successors and assigns.
Section 9.2 DELEGATION OF DUTIES. The Agent may execute any of its
duties under this Agreement or the other Loan Documents by or through agents
or attorneys-in-fact and shall be entitled to advice of counsel concerning
all matters pertaining to such duties. The Agent shall not be responsible
for the negligence or misconduct of any agents or attorneys-in-fact selected
by it with reasonable care.
Section 9.3 EXCULPATORY PROVISIONS. The Agent shall not be (i)
liable for any action lawfully taken or omitted to be taken by it or any
Person described in Section 9.2 under or in connection with this Agreement or
any other Loan Document (except for its or such Person's own gross negligence
or willful misconduct), or (ii) responsible in any manner to any of the
Lenders for any recitals, statements, representations or warranties made by
any Loan Party contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided
for in, or received under or in connection with, this Agreement or any other
Loan Document or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement, or any other Loan Document
or for any failure of any Loan Party to perform its obligations hereunder or
thereunder. Without limiting the duties and responsibilities of the Agent
set forth in the Loan Documents, the Agent shall not be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance
of any of the agreements of any Loan Party contained in, or conditions of,
this Agreement or any other Loan Document, or to inspect the properties,
books or records of any Loan Party. This Section is intended solely to
govern the relationship between the Agent, on the one hand, and the Lenders,
on the other.
Section 9.4 RELIANCE BY AGENT. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any Notes, writing, resolution,
notice, consent, certificate, affidavit, letter, cablegram, telegram,
telecopy, telex or teletype message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to any
Loan Party), independent accountants and other
47
experts selected by the Agent. The Agent may deem and treat the payee of any
Note as the owner thereof for all purposes unless the Agent shall have
received an executed Transfer Supplement in respect thereof. The Agent shall
be fully justified in failing or refusing to take any action under this
Agreement or any other Loan Document unless it shall first receive such
advice or concurrence of the Required Lenders as it deems appropriate or it
shall first be indemnified to its satisfaction by the Lenders against any and
all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agent shall in all cases be fully
protected in acting, or in refraining from acting, under this Agreement and
the other Loan Documents in accordance with a request of the Required
Lenders, and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Notes.
Section 9.5 NOTICE OF DEFAULT. The Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Agent has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating
that such notice is a "notice of default." In the event that the Agent
receives such a notice, the Agent shall promptly give notice thereof to the
Lenders. The Agent shall take such action with respect to such Default or
Event of Default as shall be directed by the Required Lenders, PROVIDED that
unless and until the Agent shall have received such directions, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to such Default or Event of Default as the Agent shall
deem advisable and in the best interests of the Lenders.
Section 9.6 NON-RELIANCE ON AGENT AND OTHER LENDERS. Each Lender
expressly acknowledges that neither the Agent, nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made any
representations or warranties to it and that no act by the Agent hereafter
taken, including, without limitation, any review of the affairs of any Loan
Party, shall be deemed to constitute any representation or warranty by the
Agent. Each Lender represents and warrants to the Agent that it has,
independently and without reliance upon the Agent or any other Lender and
based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations,
property, prospects, financial and other conditions and creditworthiness of
the Loan Parties and made its own decision to make its Loans hereunder and
enter into this Agreement. Each Lender also represents that it will,
independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement, and to make such
investigation as it deems necessary to inform itself as to the business,
operations, property, prospects, financial and other condition and
creditworthiness of the Loan Parties. Except for notices, reports and other
documents expressly required under the Loan Documents to be furnished to the
Lenders by the Agent, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the
business, operations, property, prospects, financial and other condition or
creditworthiness of the Loan Parties which may come into the possession of
the Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or affiliates.
48
Section 9.7 INDEMNIFICATION. The Lenders agree to indemnify the
Agent, the Arranger and their respective officers, directors, employees,
representatives and agents (to the extent not reimbursed by the Loan Parties
and without limiting the obligation of the Loan Parties to do so), ratably
according to their Pro Rata Shares, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (including,
without limitation, the fees and disbursements of counsel for the Agent, the
Arranger or such Person in connection with any investigative, administrative
or judicial proceeding commenced or threatened, whether or not the Agent, the
Arranger or such Person shall be designated a party thereto) that may at any
time (including, without limitation, at any time following the payment of the
Obligations) be imposed on, incurred by or asserted against the Agent, the
Arranger or such Person as a result of, or arising out of, or in any way
related to or by reason of, the execution, delivery or performance of any
Loan Document or any other Transaction Document (but excluding any such
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting solely from the gross
negligence or willful misconduct of the Agent, the Arranger or such Person as
finally determined by a court of competent jurisdiction and excluding the
actions of the Agent when acting solely in its capacity as a Lender).
Section 9.8 AGENT IN ITS INDIVIDUAL CAPACITY. The Agent and its
affiliates may make loans to, accept deposits from and generally engage in
any kind of business with the Loan Parties as though the Agent were not the
Agent hereunder. With respect to Loans made or renewed by it and any Note
issued to it, the Agent shall have the same rights and powers under this
Agreement as any Lender and may exercise the same as though it were not the
Agent, and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
Section 9.9 SUCCESSOR AGENT. (i) The Agent may resign as Agent and
Collateral Agent upon 30 days' notice to the Borrower and the Lenders. If
the Agent shall resign as Agent, then the Required Lenders during such 30-day
period shall appoint from among the Lenders a successor agent, whereupon such
successor agent, upon its acceptance, shall succeed to the rights, powers and
duties of the Agent and Collateral Agent and the term "Agent" and "Collateral
Agent" shall mean such successor agent, effective upon its appointment, and
the former Agent's rights, powers and duties as Agent shall be terminated,
without any other or further act or deed on the part of such former Agent or
any of the parties to this Agreement or any holders of the Notes. A
successor to the Collateral Agent (other than First Bank as successor to The
Bank of New York as Collateral Agent) shall not be the "Collateral Agent"
under the Security Documents and shall not be entitled to the Liens created
thereunder until it shall have executed and delivered an intercreditor
agreement substantially on the same terms as the BNY Intercreditor Agreement.
(ii) Notwithstanding any provision to the contrary elsewhere
in this Agreement or in any of the Loan Documents, upon the execution and
delivery of the Instruments of Assignment to the Issuing Banks, The Bank of
New York, if at such time it shall be serving as the Agent or the Collateral
Agent, shall be deemed to have resigned as, and First Bank shall be deemed
appointed as successor, Agent and Collateral Agent without any further notice
or acceptance. As such successor, First Bank shall succeed to the rights,
powers and duties of the Agent and the Collateral Agent under the Loan
Documents and the terms "Agent" and
49
"Collateral Agent" thereunder shall mean First Bank as such successor.
Effective upon the execution and delivery of the Instruments of Assignment,
The Bank of New York's rights, powers and duties as Agent and Collateral
Agent shall terminate, without any other or further act or deed on the part
of The Bank of New York or any of the parties to this Agreement or any
holders of the Notes. The Bank of New York shall execute and deliver such
amendments to UCC filings and mortgage recordings as may be appropriate to
reflect its resignation and First Bank's succession as Agent and Collateral
Agent.
(iii) After any retiring Agent's resignation hereunder as
Agent, the provisions of this Section 9 and Section 10.1 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
Section 9.10 INTERPRETATION. As used in this Section 9, the term
"Agent" as applied to a Person that is acting both as Agent and Collateral Agent
shall be deemed a reference to such Person both in its capacity as Agent and
Collateral Agent.
SECTION 10 MISCELLANEOUS.
Section 10.1 PAYMENT OF EXPENSES, INDEMNITY, ETC. The Borrower
shall:
(a) whether or not the transactions hereby contemplated are
consummated, pay all reasonable out-of-pocket costs and expenses of the Agent in
connection with the negotiation, preparation, execution and delivery of the Loan
Documents and the documents and instruments referred to therein, the creation,
perfection or protection of the Agent's Liens in the Collateral (including,
without limitation, fees and expenses for title and lien searches and filing and
recording fees), and any amendment, waiver or consent relating to any of the
Loan Documents (including, without limitation, as to, each of the foregoing, the
reasonable fees and disbursements of Winthrop, Xxxxxxx, Xxxxxx & Xxxxxxx,
special counsel to the Agent and any other attorneys retained by the Agent) and
of the Agent and each Lender in connection with the preservation of rights
under, and enforcement of, the Loan Documents and the documents and instruments
referred to therein or in connection with any restructuring or rescheduling of
the Obligations (including, without limitation, the reasonable fees and
disbursements of counsel for the Agent and for each of the Lenders);
(b) pay the fees and disbursements of any independent
accountant or consultant retained by the Agent to audit the composition of the
Accounts and Inventory which are part of the Borrowing Base and to prepare and
deliver to the Agent such reports and information as the Agent requests with
respect thereto;
(c) pay, and hold the Agent and each of the Lenders harmless
from and against, any and all present and future stamp, excise and other similar
taxes with respect to the foregoing matters and hold the Agent and each Lender
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
Lender) to pay such taxes; and
50
(d) indemnify the Agent, the Arranger and each Lender, and
their respective officers, directors, employees, representatives and agents
(each, an "INDEMNITY") from, and hold each of them harmless against, any and
all losses, liabilities, claims, damages, expenses, obligations, penalties,
actions, judgments, suits, costs or disbursements of any kind or nature
whatsoever (including, without limitation, the fees and disbursements of
counsel for such Indemnity in connection with any investigative,
administrative or judicial proceeding commenced or threatened, whether or not
such Indemnity shall be designated a party thereto, but excluding any tax or
an increased tax on the net income of such Lender) that may at any time
(including, without limitation, at any time following the payment of the
Obligations) be imposed on, asserted against or incurred by any Indemnity as
a result of, or arising out of, or in any way related to or by reason of, (i)
any of the Transactions or the execution, delivery or performance of any Loan
Document or any other Transaction Document, (ii) any violation by any Loan
Party of any applicable Environmental Law, (iii) any Environmental Claim
arising out of the management, use, control, ownership or operation of
property or assets by any of the Loan Parties, including, without limitation,
all on-site and off-site activities involving Materials of Environmental
Concern, (iv) the breach of any environmental representation or warranty set
forth in Section 5.18, (v) the grant to the Agent, the Collateral Agent and
the Lenders of any Lien in any property or assets of any of the Loan Parties
or any stock or other equity interest in any of the Loan Parties, and (vi)
the exercise by the Agent and the Lenders of their rights and remedies
(including, without limitation, foreclosure) under any agreements creating
any such Lien (but excluding, in each case, as to any Indemnity, any such
losses, liabilities, claims, damages, expenses, obligations, penalties,
actions, judgments, suits, costs or disbursements incurred solely by reason
of the gross negligence or willful misconduct of such Indemnity as finally
determined by a court of competent jurisdiction). The Borrower's obligations
under this Section shall survive the termination of this Agreement and the
payment of the Obligations.
Section 10.2 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 any 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 Loan 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, time or demand, provisional or final) 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 Loan Party against and on account
of the Obligations of the Loan Parties to such Lender under this Agreement or
under any of the other Loan Documents, including, without limitation, all
interests in Obligations purchased by such Lender pursuant to Section 10.7,
and all other claims of any nature or description arising out of or connected
with this Agreement or any other Loan 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.
Section 10.3 NOTICES. Except as otherwise expressly provided herein,
all notices, requests and demands to or upon the respective parties hereto to
be effective shall be in writing (including by telecopy, telex, or cable
communication), and shall be deemed to have been duly
51
given or made when delivered by hand, or five days after being deposited in
the United States mail, postage prepaid, or, in the case of telex notice,
when sent, answerback received, or, in the case of telecopy notice, when
sent, or, in the case of a nationally recognized overnight courier service,
one Business Day after delivery to such courier service, addressed, in the
case of each party hereto, at its address specified opposite its signature
below or on the appropriate Transfer Supplement, or to such other address as
may be designated by any party in a written notice to the other parties
hereto, provided that notices and communications to the Agent shall not be
effective until received by the Agent.
Section 10.4 SUCCESSORS AND ASSIGNS; PARTICIPATION; ASSIGNMENTS. (a)
SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the Borrower, the Lenders, the Agent, all future holders of
the Notes and their respective successors and assigns, except that the
Borrower may not assign or transfer any of its rights or obligations under
this Agreement without the prior written consent of each Lender. No Lender
may participate, assign or sell any of its Credit Exposure (as defined in
clause (c) below) except as required by operation of law, in connection with
the merger, consolidation or dissolution of any Lender or as provided in this
Section 10.4.
(b) PARTICIPATION. Any Lender may at any time sell to one
or more Persons (each a "PARTICIPANT") participating interests in any Loan
owing to such Lender, any Notes held by such Lender, any Commitment of such
Lender or any other interest of such Lender hereunder. Notwithstanding any
such sale by a Lender of participating interests to a Participant, such
Lender's rights and obligations under this Agreement shall remain unchanged,
such Lender shall remain solely responsible for the performance thereof, such
Lender shall remain the holder of any such Note for all purposes under this
Agreement (except as expressly provided below), and the Borrower and the
Agent shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement.
The Borrower agrees that if any Obligations are due and unpaid, or shall have
been declared or shall have become due and payable upon the occurrence and
during the continuance of an Event of Default, each Participant shall be
deemed to have the right of setoff in respect of its participating interest
in amounts owing under this Agreement and any Note to the same extent as if
the amount of its participating interest were owing directly to it as a
Lender under this Agreement or any Note, provided that such right of setoff
shall be subject to the obligations of such Participant to share with the
Lenders, and the Lenders agree to share with such Participant, as provided in
Section 10.7. The Borrower also agrees that each Participant shall be
entitled to the benefits of Sections 2.17, 2.18 and 2.19, PROVIDED that the
Borrower shall not be required to pay any amounts pursuant to such Sections
in excess of the amount the Borrower would have been obligated to pay but for
such sale of a participating interest to such Participant. Each Lender
agrees that any agreement between such Lender and any such Participant in
respect of such participating interest shall not restrict such Lender's right
to agree to any amendment, supplement, waiver or modification to this
Agreement or any other Loan Document, other than amendments, supplements,
modifications and waivers requiring the written consent of all of the Lenders
pursuant to Section 10.5.
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(c) ASSIGNMENTS. (i) Any Lender may, in the ordinary course
of its business and in accordance with applicable law, at any time assign to
any Lender or any affiliate thereof or, with the consent of the Agent, to any
other Person (each a "PURCHASING LENDER") all or any part of the Loan owing
to such Lender, the Note held by such Lender, any Commitment of such Lender
or any other interest of such Lender hereunder (in respect of such Lender,
its "CREDIT EXPOSURE") pursuant to a supplement to this Agreement,
substantially in the form of Exhibit 10.4(c) hereto (a "TRANSFER
SUPPLEMENT"), executed by such Purchasing Lender, such transferor Lender and
the Agent, PROVIDED that any assignment to any Purchasing Lender must be in a
minimum amount of $5,000,000 and any such partial assignment shall be an
assignment of an identical percentage of the transferor Lender's Loan and
Commitment. Upon (i) such execution of such Transfer Supplement, (ii)
delivery of an executed copy thereof to the Borrower and the Agent, (iii)
payment by such Purchasing Lender to such transferor Lender of an amount
equal to the purchase price agreed between such transferor Lender and such
Purchasing Lender and (iv) payment to the Agent of a processing fee of
$3,500, such transferor Lender shall be released from its obligations
hereunder to the extent of such assignment and such Purchasing Lender shall
for all purposes be a Lender party to this Agreement and shall have all the
rights and obligations of a Lender under this Agreement to the same extent as
if it were an original party hereto, and no further consent or action by the
Borrower, the Lenders or the Agent shall be required. Such Transfer
Supplement shall be deemed to amend this Agreement to the extent, and only to
the extent, necessary to reflect the addition of such Purchasing Lender as a
Lender and the resulting adjustment of the Commitments, if any, arising from
the purchase by such Purchasing Lender of all or a portion of the Credit
Exposure of such transferor Lender. Promptly after the consummation of any
transfer to a Purchasing Lender pursuant hereto, the transferor Lender, the
Agent and the Borrower shall make appropriate arrangements so that a
replacement Note is issued to such transferor Lender and a new Note is issued
to such Purchasing Lender, in each case in principal amounts reflecting such
transfer.
(ii) Notwithstanding any provision to the contrary elsewhere
in this Agreement, upon the delivery of the Instrument of Assignment to the
Issuing Banks, and the payment to the Agent of the amount of the drawings
requested under that Letter of Credit and under the other Letter of Credits
under which drawing are then being requested, the Lenders that are
signatories to such Instrument of Assignment shall be released from their
obligation hereunder and the Issuing Banks shall for all purposes be Lenders
party to this Agreement and shall have all the rights and obligations of a
Lender under this Agreement to the same extent as if it was an original party
hereto, and no consent or action by the Borrower or the Agent shall be
required. Such Instrument of Transfer shall be deemed to amend this
Agreement to the extent, and only to the extent, necessary to reflect the
substitution of the Issuing Banks as Lenders. The provisions of this
subsection (c)(ii) shall be equally applicable to any transfer by an Issuing
Bank to the Persons for whose accounts the Letters of Credit have been issued
or to their designees and such transfer may be effected by the delivery of an
instrument of transfer such Issuing Bank and such person deemed appropriate.
Promptly after the consummation of any transfer pursuant to subsection
(c)(ii), the transferor, the Agent and the Borrower shall make appropriate
arrangements so that a new Note is issued to such transferee, in each case in
a principal amount reflecting such transfer.
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(d) DISCLOSURE OF INFORMATION. The Borrower authorizes each
Lender to disclose, on a confidential basis, to any Participant or Purchasing
Lender (each, a "TRANSFEREE") and any prospective Transferee any and all
financial and other information in such Xxxxxx's possession concerning the
Borrower which has been delivered to such Lender by the Borrower pursuant to
this Agreement or which has been delivered to such Lender by the Borrower in
connection with such Xxxxxx's credit evaluation of the Borrower prior to
entering into this Agreement.
(e) The provisions of this Section 10.4 shall not apply to
the assignment and pledge for collateral purposes, of any Lender's rights
hereunder or under any Note to any Federal Reserve Bank pursuant to
Regulation A of the Board of Governors of the Federal Reserve System and any
Operating Circular issued by such Federal Reserve Bank, PROVIDED that such
assignment and pledge shall not relieve such Lender of any of its obligations.
Section 10.5 AMENDMENTS AND WAIVERS. Neither this Agreement, any
Note, any other Loan Document to which the Borrower is a party nor any terms
hereof or thereof may be amended, supplemented, modified or waived except in
accordance with the provisions of this Section. The Required Lenders and the
Borrower may, from time to time, enter into written amendments, supplements,
modifications or waivers for the purpose of adding, deleting, changing or
waiving any provisions to this Agreement, the Notes, or the other Loan
Documents to which the Borrower is a party, PROVIDED that no such amendment,
supplement, modification or waiver shall (a) extend either the Maturity or
reduce the rate or extend the time of payment of interest on any Obligations,
or reduce the principal amount of any Obligations or reduce any fee payable
to all the Lenders hereunder, or release all or substantially all of the
Collateral (except as expressly contemplated by the Loan Documents) or
foreclose or otherwise enforce any remedies with respect to any real property
Collateral or change the amount of any Commitment of any Lender, or amend,
modify or waive any material condition precedent to the making of any the, or
amend, modify or waive any term of subordination of the Subordinated Debt
Financing Documents, or release any Guarantor or amend, modify or waive any
material term of any Guaranty, or modify the manner in which the Lenders
share in any payment received by the Agent or any Lender with respect to any
Obligation, or modify the several nature of the Commitments and the other
obligations of the Agent, the Collateral Agent and the Lenders pursuant to
the Loan Documents, or amend, modify or waive any provision of Section 3.1 or
this Section 10.5 or the definition of Required Lenders, or consent to or
permit the assignment or transfer by the Borrower of any of its rights and
obligations under this Agreement or any other Loan Document, in each case
without the written consent of all the Lenders, (b) amend, modify or waive
any provision of Section 9 or any other provision of any Loan Document if the
effect thereof is to affect the rights or duties of the Agent or the
Collateral Agent, without the written consent of the Person then serving as
such, or (c) amend, modify or waive any provision of the Collateral Account
Agreement, without the written consent of the Issuing Banks. Any such
amendment, supplement, modification or waiver shall apply to each of the
Lenders equally and shall be binding upon the Borrower, the Lenders, the
Agent, and all future holders of the Notes. In the case of any waiver, the
Borower, the Lenders and the Agent shall be restored to their former position
and rights hereunder and under the outstanding Notes, and any Default or
Event of Default waived shall be deemed to be cured and not continuing, but
no such waiver shall
54
extend to any subsequent or other Default or Event of Default, or impair any
right consequent thereon.
Section 10.6 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of the Agent or any Lender or any holder of a Note in exercising any
right, power or privilege hereunder or under any other Loan Document and no
course of dealing between any Loan Party and the Agent or any Lender or the
holder of any Note shall operate as a waiver thereof; nor shall any single or
partial exercise of any right, power or privilege hereunder or under any
other Loan Document preclude any other or further exercise thereof of the
exercise of any other right, power or privilege hereunder or thereunder. The
rights and remedies herein expressly provided are cumulative and not
exclusive of any rights or remedies which the Agent or any Lender or the
holder of any Note would otherwise have. No notice to or demand on any Loan
Party in any case shall entitle any Loan Party to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the
rights of the Agent, the Lenders or the holder of any Note to any other or
further action in any circumstances without notice or demand.
Section 10.7 SHARING OF PAYMENTS. 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 Loan Documents, or otherwise) which is applicable to the payment of any
obligations, 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 such Obligations
owing to such Lenders in such amount as shall result in a proportional
participation by all of 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.
Section 10.8 GOVERNING LAW; SUBMISSION TO JURISDICTION. (a) THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE
PRINCIPLES THEREOF RELATING TO CONFLICTS OF LAW).
(b) Any legal action or proceeding with respect to this
Agreement or any other Loan Document and any action for enforcement of any
judgment in respect thereof may be brought in the courts of the State of New
York or of the United States of America for the Southern District of New
York, and, by execution and delivery of this Agreement, the Borrower hereby
accepts for itself and in respect of its property, generally and
unconditionally, the non-exclusive jurisdiction of the aforesaid courts and
appellate courts from any thereof. The Borrower 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,
55
postage prepaid, to the Borrower at its address set forth opposite its
signature below. 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 Loan Document brought in the courts referred to above and hereby
further irrevocably 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. Nothing herein shall affect the right of the
Agent, any Lender or any holder of a 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.
Section 10.9 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.
Section 10.10 EFFECTIVENESS. This Agreement shall become effective on
the date on which all of the parties hereto shall have signed a counterpart
hereof and shall have delivered the same to the Agent which delivery, in the
case of the Lenders, may be given to the Agent by telecopy (with the
originals delivered promptly to the Agent via overnight courier service) and
the conditions precedent set forth in Section 4.1 have been satisfied.
Section 10.11 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.
Section 10.12 MARSHALLING; RECAPTURE. Neither the Agent nor any
Lender shall be under any obligation to Xxxxxxxx any assets in favor of any
Loan Party or any other party or against or in payment of any or all of the
Obligations. To the extent any Lender receives any payment by or on behalf of
any Loan Party, which payment or any part thereof is subsequently
invalidated, declared to be fraudulent or preferential, set aside or required
to be repaid to such Loan Party or its estate, trustee, receiver, custodian
or any other party under any bankruptcy law, state or Federal law, common law
or equitable cause, then to the extent of such payment or repayment, the
obligation or part thereof which has been paid, reduced or satisfied by the
amount so repaid shall be reinstated by the amount so repaid and shall be
included within the liabilities of such Loan Party to such Lender as of the
date such initial payment, reduction or satisfaction occurred.
Section 10.13 SEVERABILITY. In case any provision in or obligation
under this Agreement or the Notes or the other Loan Documents shall be
invalid, illegal or unenforceable in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
Section 10.14 SURVIVAL. All indemnities set forth herein including,
without limitation, in Sections 2.14, 2.15, 2.16, 2.17, 9.7 and 10.1 shall
survive the execution and delivery of this Agreement and the Notes and the
making and repayment of the Loans hereunder.
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Section 10.15 DOMICILE OF LOANS. Each Lender may transfer and carry
its Loans at, to or for the account of any branch office, subsidiary or
affiliate of such Lender.
Section 10.16 LIMITATION OF LIABILITY. No claim may be made by any
Loan Party or any other Person against the Agent or any Lender or the
Affiliates, directors, officers, employees, attorneys or agents of any of
them for any special, indirect, consequential or punitive damages in respect
of any claim for breach of contract or any other theory of liability arising
out of or related to the transactions contemplated by this Agreement or any
other Transactions, or any act, omission or event occurring in connection
therewith; and each Loan Party hereby waives, releases and agrees not to sue
upon any claim for any such damages, whether or not accrued and whether or
not known or suspected to exist in its favor.
Section 10.17 CALCULATIONS; COMPUTATIONS. The financial statements to
be furnished to the Agent and the Lenders pursuant hereto shall be made and
prepared in accordance with GAAP consistently applied throughout the periods
involved and consistent with GAAP as used in the preparation of the financial
statements referred to in Section 5.5 shall utilize GAAP.
Section 10.18 WAIVER OF TRIAL BY JURY. EACH OF THE BORROWER, THE
AGENT AND THE LENDERS HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH
THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR ANY MATTER ARISING HEREUNDER OR
THEREUNDER.
SECTION 11 SUBORDINATION OF OBLIGATIONS.
Section 11.1 OBLIGATIONS SUBORDINATE TO SENIOR INDEBTEDNESS. The
Borrower, each Guarantor, the Lenders and the Agent covenant and agree, and
each holder from time to time of any of the Obligations, or any promissory
note or other instrument evidencing any of the Obligations, by its acceptance
thereof likewise covenants and agrees, that (a) the Obligations, including,
without limitation, the obligations of the Borrower to pay principal and
interest hereunder or under any promissory note or other instrument issued
pursuant hereto and the obligations of each Guarantor under its Guaranty
shall be, and are hereby expressly made, subordinate and subject in right of
payment as provided in this Section 11 to the prior payment in full of the
Senior Indebtedness, and (b) all Liens on the assets of the Borrower or the
Guarantors securing the Obligations shall be, and are hereby expressly made,
subject and subordinate to the Liens on the assets of the Borrower or the
Guarantors securing the Senior Indebtedness as provided in this Section 11.
This Section 11.1 shall constitute a continuing offer to all Persons
who, in reliance upon the provisions hereof, become holders of, or continue
to hold, Senior Indebtedness; such provisions are made for the benefit of the
holders of Senior Indebtedness; and such holders are made obligees hereunder
and they or each of them may enforce such provisions.
Section 11.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC. In the
event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or
57
other similar case or proceeding in connection therewith, relative to the
Borrower or any Guarantor (each, an "OBLIGOR") or to its assets, or (b) any
liquidation, dissolution or other winding up of any Obligor, whether
voluntary or involuntary and whether or not involving insolvency or
bankruptcy, or (c) any assignment for the benefit of creditors or any other
marshaling of assets or liabilities of any Obligor, then and in any such
event:
(1) the holders of Senior Indebtedness of such Obligor shall
be paid in full all amounts due on or in respect of all such Senior
Indebtedness, before the Lenders are entitled to receive any payment or
distribution of any kind or character (excluding Junior Securities) on
account of the principal of, premium, if any, or interest on the Obligations
of such Obligor;
(2) any payment or distribution of assets of such Obligor of
any kind or character, whether in cash, property or securities (excluding
Junior Securities), by set-off or otherwise, to which the Lenders would be
entitled but for the provisions of this Section 11.2 shall, subject to clause
(4) below, be paid by the liquidating trustee or agent or other Person making
such payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of Senior
Indebtedness of such Obligor or to the Senior Agent, ratably according to the
aggregate amounts remaining unpaid on account of such Senior Indebtedness
held by such holder, to the extent necessary to make payment in full of all
such Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution to the holders of such Senior
Indebtedness, whether such concurrent payment or distribution represents a
payment on account of such Senior Indebtedness or a payment or distribution
to such holders pursuant to Section 1407 of the Subordinated Note Indenture
or any Existing Note;
(3) in the event that, notwithstanding the foregoing
provisions of this Section, any Lender shall have received any direct or
indirect payment or distribution of assets of such Obligor of any kind or
character, whether in cash, property or securities, in respect of principal,
premium, if any, and interest on the Obligations of such Obligor before all
Senior Indebtedness of such Obligor is paid in full, then and in such event
such payment or distribution (excluding Junior Securities) shall, subject to
clause (4) below, be held in trust for the benefit of, and shall be promptly
paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making
payment or distribution of assets of such Obligor for application to the
payment of all Senior Indebtedness of such Obligor remaining unpaid, to the
extent necessary to pay all Senior Indebtedness of such Obligor in full after
giving effect to any concurrent payment or distribution to or for the holders
of Senior Indebtedness, whether such concurrent payment or distribution
represents a payment on account of such Senior Indebtedness or a payment or
distribution to such holders pursuant to Section 1407 of the Subordinated
Note Indenture or any Existing Note; and
(4) notwithstanding any provision to the contrary contained in
this Section 11.2, the payments and distributions to the Lenders shall not be
required to be paid over as provided in clauses (2) and (3), except to the
extent that the holders of the Senior Indebtedness, or the Senior Agent, as
the case may be, have not been paid in full after giving effect to all
amounts then or thereafter required to be paid to such holders pursuant to
Section 1407 of the Subordinated Note
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Indenture or any Existing Note.
The consolidation of an Obligor with, or the merger of an Obligor with
or into, another Person or the liquidation or dissolution of an Obligor
following the sale, assignment, conveyance, transfer, lease or other disposal
of all or substantially all of such Obligor's properties or assets to another
Person upon the terms and conditions set forth in Section 7.3 shall not be
deemed a dissolution, winding up, liquidation, reorganization, assignment for
the benefit of creditors or marshaling of assets and liabilities of such
Obligor for the purposes of this Section if the Person formed by such
consolidation or the surviving entity of such merger or the Person which
acquires by sale, assignment, conveyance, transfer, lease or other disposal
of all or substantially all of such Obligor's properties or assets, as the
case may be, shall, as a part of such consolidation, merger, sale,
assignment, conveyance, transfer, lease or other disposal, comply with the
conditions set forth in Section 7.3.
Section 11.3 SUSPENSION OF PAYMENT WHEN SENIOR INDEBTEDNESS IN
DEFAULT. (a) Unless Section 11.2 shall be applicable, upon the occurrence
of a Payment Default, no direct or indirect payment or distribution of any
assets of any Obligor of any kind or character shall thereafter be made on
account of principal of, premium, if any, or interest on, the Obligations or
on account of the purchase, redemption or other acquisition of or in respect
of the Notes unless and until such Payment Default shall have been cured or
waived or shall have ceased to exist and any acceleration of Senior
Indebtedness has been rescinded or the Senior Indebtedness with respect to
which such Payment Default shall have occurred shall have been discharged or
paid in full, after which each Obligor shall resume making any and all
required payments in respect of the Obligations, including any missed
payments.
(b) Unless Section 11.2 shall be applicable, upon (1) the
occurrence of a Non-payment Default and (2) receipt by the Agent and by the
Borrower from the Senior Agent of written notice of such occurrence (a
"PAYMENT BLOCKAGE NOTICE") no payment or distribution of any assets of the
Borrower of any kind or character (other than with funds deposited for such
purpose with the Agent pursuant to Section 2.12 prior to the receipt by the
Agent of such Payment Blockage Notice) shall thereafter be made on account of
any principal of, premium, if any, or interest on, the Obligations or on
account of the purchase, redemption, retirement or other acquisition of or in
respect of Notes for a period ("PAYMENT BLOCKAGE PERIOD") commencing on the
date of receipt by the Agent of such notice and ending on the earliest of
(subject to any blockage of payments that may then or thereafter be in effect
under subsection (a) of this Section 11.3) (x) 179 days having elapsed since
receipt of such written notice by the Agent (provided any Senior Indebtedness
shall theretofore have not been accelerated), (y) the date such Non-payment
Default and all other Non-payment Defaults as to which notice is also given
after such period is initiated shall have been cured or waived or shall have
ceased to exist or the Senior Indebtedness related thereto shall have been
discharged or paid in full or (z) the date on which such Payment Blockage
Period (and all Non-payment Defaults as to which notice is given after such
Payment Blockage Period is Initiated) shall have been terminated by written
notice to the Borrower and the Agent from the Senior Agent, after which, in
each such case, the Obligors shall resume making any and all required
payments in respect of the Obligations, including any missed payments.
Notwithstanding any other provision of this Agreement, in no event shall a
Payment
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Blockage Period extend beyond 179 days from the date of the receipt by the
Borrower or the Agent of the notice referred to in clause (2) of this
paragraph (b) (the "INITIAL BLOCKAGE PERIOD"). Any number of notices of
Non-payment Defaults may be given during the Initial Blockage Period,
PROVIDED that during any 360-day consecutive period only one Payment Blockage
Period during which payment of the Obligations may not be made may commence
and the duration of the Payment Blockage Period may not exceed 179 days. No
Non-payment Default with respect to Senior Indebtedness which existed or was
continuing on the date of the commencement of any Payment Blockage Period
will be, or can be, made the basis for the commencement of a second Payment
Blockage Period, whether or not within a period of 360 consecutive days,
unless such default shall have been cured or waived for a period of not less
than 90 consecutive days.
(c) In the event that, notwithstanding the foregoing, the
Agent or the holder of any Obligations shall receive any payment or
distribution prohibited by the foregoing provisions of this Section 11.3.,
then and in such event such payment or distribution shall be held in trust
for the benefit of, and shall be promptly paid over and delivered forthwith
to, the Senior Agent.
Section 11.4 APPLICATION OF MONIES DEPOSITED. Nothing contained in
this Section 11.4, elsewhere in this Agreement or in any of the Notes shall
(i) affect the obligation of each Obligor to make, or prevent any Obligor
from making, at any time except as specified in Section 11.2 or 11.3 to the
extent provided therein, payments pursuant to this Agreement or (ii) prevent
the application to the Obligations by the Agent (and retention by the
Subordinated Creditors) of any monies received by the Agent from any Obligor
or its assets for the account of the Subordinated Creditors if, at the time
such money was received by the Agent, a payment by such Obligor of the
Obligations would not have been prohibited by the foregoing provisions of
this Section 11.
Section 11.5 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the prior payment in full of all Senior Indebtedness, the Lenders
shall be subrogated, to the extent of the aggregate payments, if any,
received by holders of Senior Indebtedness pursuant to the terms of Section
11.2 and 11.3, to the rights of the holders of such Senior Indebtedness to
receive payments and distributions of cash, property and securities
applicable to the Senior Indebtedness until the principal of, premium, if
any, and interest on the Obligations shall be paid in full. For purposes of
such subrogation, no payments or distributions to the holders of Senior
Indebtedness of any cash, property or securities to which the Subordinated
Creditors would be entitled except for the provisions of this Section 11.5,
and no payments over pursuant to the provisions of this Section 11.5 to the
holders of Senior Indebtedness by the Lenders or the Agent, shall, as among
the Obligors, their creditors other than holders of Senior Indebtedness, and
the Subordinated Creditors, be deemed to be a payment or distribution by the
Obligors to or on account of the Senior Indebtedness.
Section 11.6 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this Section 11.6 are intended solely for the purpose of
defining the relative rights of the holders of the Obligations on the one
hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Section 11.6 or elsewhere in this Agreement or in the Notes
is intended to or shall (a) impair, as among the Obligors, their creditors
other than holders of Senior Indebtedness and the holders of the Obligations,
the obligation of the Obligors, which is absolute
60
and unconditional, to pay to the holders of the Obligations as and when the
same shall become due and payable in accordance with its terms; or (b) affect
the relative rights against the Obligors of the holders of the Obligations
and creditors of the Borrower other than the holders of Senior Indebtedness;
or (c) prevent the Agent or the holder of any Obligations from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under this Section 11.6 of the
holders of Senior Indebtedness (1) in any case, proceeding, dissolution,
liquidation or other winding up, assignment for the benefit of creditors or
other marshaling of assets and liabilities of the Borrower referred to in
Section 11.2, to receive, pursuant to and in accordance with such Section,
cash, property and securities otherwise payable or deliverable to the Agent
or such holder, or (2) under the conditions specified in Section 11.3, to
prevent any payment prohibited by such Section or enforce their rights
pursuant to Section 11.3(c).
Section 11.7 AGENT TO EFFECTUATE SUBORDINATION. Each Subordinated
Creditor authorizes and directs the Agent, on behalf of such Subordinated
Creditor, to take such action as may be necessary or appropriate to
effectuate the subordination provided in Section 11 and appoints the Agent
its attorney-in-fact for any and all such purposes, including, in the event
of any dissolution, winding-up, liquidation or reorganization of any Obligor
whether in bankruptcy, insolvency, receivership proceedings, or otherwise,
the timely filing of a claim for the unpaid balance of the Obligations of
such Obligor owing to such Subordinated Creditor in the form required in such
proceedings and the causing of such claim to be approved.
Section 11.8 NO WAIVER OF SUBORDINATION PROVISIONS. (a) No right of
any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced
or impaired by any act or failure to act on the part of any Obligor or by any
act or failure to act by any such holder, or by any non-compliance by any
Obligor with the terms, provision and covenants of this Agreement, regardless
of any knowledge thereof any such holder may have or be otherwise charged
with.
(b) Without limiting the generality of Subsection (a) of
this Section and notwithstanding any other provision contained herein, but
subject to the provisions of the Intercreditor Agreement, the holders of
Senior Indebtedness may, at any time and from time to time, without the
consent of or notice to the Agent or the Subordinated Creditors, without
incurring responsibility to the Subordinated Creditors and without impairing
or releasing the subordination provided in this Section 11.8 or the
obligations hereunder of the holders of the Obligations to the holders of
Senior Indebtedness, do any one or more of the following: (1) change the
manner, place or terms of payment or extend the time of payment of, or renew
or alter, Senior Indebtedness or any instrument evidencing the same or any
agreement under which the Senior Indebtedness is outstanding; (2) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Indebtedness; (3) release any Person liable in any
manner for the collection or payment of Senior Indebtedness; (4) exercise or
refrain from exercising any rights against the Borrower and any other Person;
and (5) otherwise deal freely and in good faith with the Borrower and each
Guarantor; PROVIDED, HOWEVER, that in no event shall any such actions by the
holders of Senior Indebtedness limit the right of the holders of the
Obligations to take any action to accelerate the maturity of the Obligations
in accordance
61
with the provisions set forth in Section 8 or to pursue any rights or
remedies under this Agreement or under applicable laws. No provision in any
amendment to this Agreement which affects the superior position of the
holders of Senior Indebtedness will be effective against the holders of
Senior Indebtedness who have not consented thereto.
Section 11.9 NOTICE TO AGENT. (a) The Borrower shall give prompt
written notice to the Agent of any fact known to the Borrower which would
prohibit the making of any payment to or by the Agent in respect of the
Obligations. Notwithstanding the provisions of this Section 11.9 or any
provision of this Agreement, neither the Agent nor any Subordinated Creditor
shall be charged with knowledge of the existence of any facts which would
prohibit the making of any payment in respect of the Obligations, unless and
until the Agent or such Subordinated Creditor, as the case may be, shall have
received written notice thereof from the Borrower, a holder of Senior
Indebtedness or the Senior Agent; and, prior to the receipt of any such
written notice, the Agent and each Subordinated Creditor shall be entitled in
all respects to assume that no such facts exist; PROVIDED, HOWEVER, that if
the Agent shall not have received the notice provided for in this Section
prior to the date upon which by the terms hereof any money may become payable
for any purpose (including, without limitation, the payment of the principal
of, premium, if any, or interest on any Obligations), then, anything herein
contained to the contrary notwithstanding but without limiting the rights and
remedies of the holders of Senior Indebtedness or any trustee, fiduciary or
agent thereof, the Agent shall have full power and authority to receive such
money and to apply the same to the purpose for which such money was received
(and each Subordinated Creditor shall be entitled to retain the money so paid
to it by the Agent) and neither the Agent nor any Subordinated Creditor shall
be affected by any notice to the contrary which may be received by it after
such date; nor shall the Agent be charged with knowledge of the curing of any
such default or the elimination of the act or condition preventing any such
payment unless and until the Agent shall have received an Officer's
Certificate to such effect.
(b) The Agent and each Subordinated Creditor shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself to be the Senior Agent or a holder of Senior
Indebtedness (or a trustee, fiduciary or agent therefor or duly authorized
officer thereof) to establish that such notice has been given by the Senior
Agent or a holder of Senior Indebtedness (or a trustee, fiduciary or agent
therefor or duly authorized officer thereof). In the event that the Agent or
any Subordinated Creditor determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior
Indebtedness to participate in any payment or distribution pursuant to this
Section 11.9, the Agent or such Subordinated Creditor may request such Person
to furnish evidence to the reasonable satisfaction of the Agent or such
Subordinated Creditor as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Section 11.9, and if such evidence is not furnished, the
Agent or such Subordinated Creditor may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 11.10 RIGHTS OF AGENT AS A HOLDER OF SENIOR INDEBTEDNESS,
PRESERVATION OF AGENT'S RIGHTS. The Agent in its individual capacity and
each Subordinated Creditor shall be
62
entitled to all the rights set forth in this Section 11 with respect to any
Senior Indebtedness which may at any time be held by it, to the same extent
as any other holder of Senior Indebtedness, and nothing in this Agreement
shall deprive the Agent or any Subordinated Creditor of any of its rights as
such holder. Nothing in this Section 11 shall apply to claims of, or
payments to, the Agent under or pursuant to Section 9.7.
Section 11.11 NO SUSPENSION OF REMEDIES. Nothing contained in this
Section 11 shall limit the right of the Agent or the holders of Obligations
to take any action to accelerate the maturity of the Obligations pursuant to
Section 8 hereof and as set forth in this Agreement or to pursue any rights
or remedies hereunder or under applicable law, subject to the rights, if any,
under this Section 11 of the holders, from time to time, of Senior
Indebtedness to receive the cash, property or securities receivable upon the
exercise of such rights and remedies.
Section 11.12 RELATION OF HOLDERS OF SENIOR INDEBTEDNESS. With
respect to the holders of Senior Indebtedness, the Agent and each
Subordinated Creditor undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this Section 11,
and no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Section 11 against the Agent or any
Subordinated Creditor. Neither the Agent nor any Subordinated Creditor shall
be deemed to owe any fiduciary duty to the holders of Senior Indebtedness and
neither the Agent nor any Subordinated Creditor shall be liable to any holder
of Senior Indebtedness if it shall mistakenly in the absence of gross
negligence or willful misconduct pay over or deliver to Subordinated
Creditors, the Borrower or any other Person moneys or assets to which any
holder of Senior Indebtedness shall be entitled by virtue of this Section 11
or otherwise.
[Remainder of Page Intentionally Left Blank]
63
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.
GENMAR HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxxx XX
-----------------------------------
Executive Vice President
Genmar Holdings, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxxxx, Xxxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
THE BANK OF NEW YORK,
as Agent and a Lender
By: /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------
Vice President
The Bank of New York
Xxx Xxxx Xxxxxx
U.S. Commercial Banking
Central Division
19th Floor
New York, New York 10286
Attn: Xxxxxxx X. Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
FIRST BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx Xxxxxx
-----------------------------------
Vice President
First Bank Place
8th Floor
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Xxxxxxx Xxxxxx
Assistant Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Agreement Date: October 20, 1997
Solely for purposes of acknowledging
its agreement to be successor Agent as
provided in Section 9.9,
FIRST BANK NATIONAL
ASSOCIATION
By:
-----------------------------------
Vice President
Annex I to
CREDIT AGREEMENT
LENDERS AND COMMITMENTS
Name Of Lender Committment
-------------- ----------
The Bank of New York $30,000,000
First Bank National Association $30,000,000
-----------
$60,000,000
EXHIBIT 1.1(a)
FORM OF LETTER OF CREDIT
EXHIBIT 1.1(b)
FORM OF GUARANTY
EXHIBIT 1.1(c)
FORM OF PLEDGE AGREEMENT
EXHIBIT 1.1(d)
FORM OF SECURITY AGREEMENT
EXHIBIT 1.1(e)
FORMS OF SUBORDINATION AGREEMENTS
EXHIBIT 1.1(f)
FORM OF TRADEMARK SECURITY AGREEMENT
EXHIBIT 2.1
FORM OF NOTE
GENMAR HOLDINGS, INC.
$_________________ New York, New York
[Date of Initial Term Loan Advance]
FOR VALUE RECEIVED, the undersigned, GENMAR HOLDINGS, INC., a Delaware
corporation (the "Borrower"), hereby promises to pay to the order of
_________________ (the "Lender"), at the office of The Bank of New York (the
"Agent") at One Wall Street, New York, New York 10286, on the Final Maturity
Date (as defined in the Subordinated Term Loan Credit Agreement dated as of
October 20, 1997 (as amended from time to time, the "Credit Agreement")), the
principal sum of ____________________ Dollars ($___________) or, if less, the
aggregate unpaid principal amount of all Advances (as defined in the Credit
Agreement) made to the Borrower by the Lender pursuant to the Credit Agreement,
in lawful money of the United States of America in immediately available funds,
and to pay interest from the date hereof on the principal amount hereof from
time to time outstanding, in like funds, at said office, at the rate or rates
per annum and payable on the dates provided in the Credit Agreement.
The Borrower promises to pay interest, on demand, on any overdue
principal and, to the extent permitted by law, overdue interest from their due
dates at the rate or rates provided in the Credit Agreement.
The Borrower hereby waives diligence, presentment, demand, protest and
notice of any kind whatsoever. The nonexercise by the holder of any of its
rights hereunder in any particular instance shall not constitute a waiver
thereof in that or any subsequent instance.
All borrowings evidenced by this Note and all payments and prepayments of
the principal hereof and interest hereon and the respective dates and maturity
dates thereof shall be endorsed by the holder hereof on the schedule attached
hereto and made a part hereof or on a continuation thereof that shall be
attached hereto and made a part hereof, or otherwise recorded by such holder in
its internal records; PROVIDED, HOWEVER, that the failure of the holder hereof
to make such a notation or any error in such a notation shall not affect the
obligations of the Borrower under this Note.
This Note is the Note referred to in the Credit Agreement, which, among
other things, contains provisions for the acceleration of the maturity hereof
upon the happening of certain events, for optional prepayment of the principal
hereof prior to the maturity hereof and for the amendment or waiver of certain
provisions of the Credit Agreement, all upon the terms and conditions therein
specified. This Note is secured as provided in the Credit Agreement. This Note
shall be governed by, and construed in accordance with, the laws of the State of
New York. GENMAR HOLDINGS, INC.,
By:
--------------------------
Name:
------------------------
Title:
-----------------------
8
LOANS AND PAYMENTS
------------------
AMOUNT AND MATURITY UNPAID NAME OF PERSON
DATE TYPE OF LOAN DATE PRINCIPAL MAKING NOTATION
BALANCE OF
NOTE
PAYMENTS
--------
PRINCIPAL INTEREST
--------------------------------------------------------------------------------
9
EXHIBIT 2.2
FORM OF NOTICE OF BORROWING
Bank of New York, as Agent
for the Lenders parties
to the Credit Agreement
referred to below
Xxx Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:
-------------------------
Ladies and Gentlemen:
The undersigned, Genmar Holdings, Inc., refers to the Subordinated Term
Loan Credit Agreement, dated as of October 20, 1997 (the "CREDIT AGREEMENT", the
terms defined therein being used herein as therein defined), among the
undersigned, certain Lenders parties thereto, The Bank of New York, as Agent for
said Lenders and BNY Capital Markets, Inc., as Arranger, and hereby gives you
notice, irrevocably, pursuant to Section 2.3 of the Credit Agreement that the
undersigned hereby requests a Borrowing under the Credit Agreement, and in that
connection sets forth below the information relating to such Borrowing (the
"PROPOSED BORROWING") as required by Section 2.3 of the Credit Agreement:
(i) The Business Day of the Proposed Borrowing is __________,
19__.
(ii) The aggregate amount of the Proposed Borrowing is
$___________.
[(iii) The Type of Loans comprising the Proposed Borrowing is
[Base Rate Loans] [Eurodollar Loans].]
[(iv) The initial Interest Period for such Eurodollar Loan made
as part of the Proposed Borrowing is _____ month[s].]
The undersigned hereby certifies that the following statements are true
on the date hereof, and will be true on the date of the Proposed Borrowing:
(A) Each representation and warranty made or deemed made under
any Loan Document shall be true and correct at and as of the time such
Advance is to be made, both with and without giving effect to such
Advance and all other Advances to be made at such time and to the
application of the proceeds thereof.
11
(B) No Default shall have occurred and be continuing at the
time such Advance is to be made or would result from the making of such
Advance and all other Advances to be made at such time or from the
application of the proceeds thereof.
Very truly yours,
GENMAR HOLDINGS, INC.
By:
-------------------------
Title:
12
EXHIBIT 7.3(a)
GENMAR HOLDINGS, INC.
FORM OF PERMITTED ORGANIZATIONAL CHANGE CERTIFICATE
Reference is made to the Subordinated Term Loan Credit Agreement
dated as of October 20, 1997, as the same may be amended, modified or restated
from time to time (the "Credit Agreement"), among Genmar Holdings, Inc. (the
"Borrower"), the lenders identified therein, the Bank of New York, acting in its
capacity as agent for such lenders and BNY Capital Markets, Inc. as Arranger.
Terms defined in the Credit Agreement and not otherwise defined herein are used
with the meaning as so defined.
Reference is also made to [the relevant document] governing the
transaction to which this certificate pertains (the "Transaction").
I, ____________, the duly qualified and elected __________ of the
Borrower, do hereby certify in such capacity on behalf of the Borrower that:
1. The Transaction is a Permitted Organizational Change.
2. The representations and warranties contained in the Credit
Agreement and in the other Loan Documents (other than representations and
warranties which expressly speak only as of a different date) are true and
correct in all material respects both before and after giving effect to the
transaction.
3. No Default or Event of Default has occurred and is
continuing either before or after giving effect to the Transaction.
4. Every Loan Party involved in the Transaction was Solvent
immediately prior to and will continue to be Solvent after giving effect to the
Transaction.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
seal of the Borrower this __th day of ____, 199_.
GENMAR HOLDINGS, INC.
By:
---------------------------
Name:
Title:
EXHIBIT 10.4(c)
FORM OF TRANSFER SUPPLEMENT
TRANSFER SUPPLEMENT DATED AS OF ____________________________________
_______________, 199__________(this "TRANSFER SUPPLEMENT") between____________
_______________,a __________________(the "ASSIGNOR"), and ____________________
_______________, a__________________ (the "ASSIGNEE").
R E C I T A L S:
WHEREAS, this Transfer Supplement is being executed and delivered in
accordance with Section 10.4 (c) of the Subordinated Term Loan Credit Agreement
dated as of October 20, 1997 (as the same may from time to time be amended,
supplemented, restated or otherwise modified in accordance with its terms, the
"Credit Agreement") among Genmar Holdings, Inc., a Delaware corporation (the
"Borrower"), the financial institutions party hereto (the "Lenders"), The Bank
of New York, acting in its capacity as agent for the Lenders (in such capacity,
the "Agent") and BNY Capital Markets, Inc., as Arranger;
WHEREAS, capitalized terms defined in the Credit Agreement which are not
otherwise defined herein are used herein as therein defined;
WHEREAS, the Assignee wishes to purchase all of the Assignor's rights and
obligations under the Credit Agreement;
WHEREAS, the Assignor is willing to assign and delegate to the Assignee
such rights and obligations on the terms and conditions set forth herein; and
WHEREAS, the Agent has, to the extent required by the Credit Agreement,
consented to such assignment;
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. For the good and valuable consideration, the receipts and
sufficiency of which is hereby acknowledged, the Assignor hereby assigns,
transfers and delegates to the Assignee, and the Assignee hereby purchases,
takes and assumes from the Assignor, [all of] the Assignor's rights and
obligations under the Credit Agreement and the other Loan Documents as of the
Transfer Date (as defined below), including, without limitation, all of the
Assignor's Credit Exposure, together with all instruments, documents and
collateral security pertaining thereto.
2. The assignment, transfer and delegation hereunder is made
without recourse, representation or warranty, except that the Assignor
represents and warrants that: (a) as of the date hereof, the outstanding
aggregate principal of all Loans made by it and its Commitment (without
giving effect to assignments thereof which have not yet become effective) is
US$______________and US$______________, respectively; and (b) it is the legal
and beneficial owner of the interest being assigned by it hereunder and that
such interest is free and clear of any
adverse claim or other Lien. Without limiting the generality of the
foregoing, the Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with the Loan Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Loan
Documents or any other instrument or document furnished pursuant thereto, and
makes no representation or warranty and assumes no responsibility with
respect to the financial condition of the Borrower or any of the Guarantors,
or the performance or observance by the Borrower or any of the Guarantors, of
any of their respective obligations under the Loan Documents or any
instrument or document furnished pursuant thereto.
3. The Assignee hereby: (a) confirms that it has received a copy of
the Loan Documents, together with copies of financial statements and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter in this Transfer Supplement; (b) agrees that it
will, independently and without reliance upon the Assignor and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents; (c) agrees that it will perform all of the obligations which by the
terms of the Loan Documents are required to be performed by it as a Lender; and
(d) specifies as its address for notices the offices and telecopy and telex
numbers set forth beneath its name on the signature page hereof.
4. The effective date for this Transfer Supplement shall be _
_____________, 199_____(the "Transfer Date").
5. As of the Transfer Date, (a) the Assignee shall be a party to the
Credit Agreement and shall have the rights and obligations of a Lender
thereunder and under the other Loan Documents, and (b) the Assignor shall, to
the extent provided in this Transfer Supplement and the Credit Agreement,
relinquish its rights and be released from its obligations under the Loan
Documents.
6. From and after the Transfer Date, the Assignee shall be entitled
to all payments in respect of the interest assigned hereby made by the Agent
pursuant to the Credit Agreement. Upon the Transfer Date, delivery of an
executed copy of this Transfer Supplement shall constitute instructions by the
Assignor to the Agent to make all such payments to the Assignee. The Assignor
and Assignee shall make all appropriate adjustments in payments under the Credit
Agreement for periods prior to the Transfer Date directly between themselves.
7. Notwithstanding anything to the contrary contained herein, the
Assignor shall continue to be entitled to the benefits of the indemnities made
in favor of the Lenders under the Loan Documents.
8. THIS TRANSFER SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
15
IN WITNESS WHEREOF, the parties have caused this Transfer Supplement to be
duly executed and delivered by their officers thereunto duly authorized as of
the date first above written.
[NAME OF ASSIGNOR]
By:
--------------------------
Name:
Title:
By:
--------------------------
Name:
Title:
[NAME OF ASSIGNEE]
By:
--------------------------
Name:
Title:
Address for notices:
[Address, including]
telecopy and telex numbers]
Accepted and Agreed to as of
the date first written above:
THE BANK OF NEW YORK,
as Agent
By:
--------------------------
Name:
Title:
16
TABLE OF CONTENTS
PAGE
----
SECTION 1 DEFINITIONS
SECTION 1.1 DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 2 AMOUNT AND TERMS OF CREDIT FACILITY
SECTION 2.1 TERM LOAN. . . . . . . . . . . . . . . . . . . . . . . . . . .14
SECTION 2.2 NOTICE OF BORROWING. . . . . . . . . . . . . . . . . . . . . .15
SECTION 2.3 DISBURSEMENT OF FUNDS. . . . . . . . . . . . . . . . . . . . .15
SECTION 2.4 INTEREST . . . . . . . . . . . . . . . . . . . . . . . . . . .16
SECTION 2.5 INTEREST PERIODS . . . . . . . . . . . . . . . . . . . . . . .17
SECTION 2.6 MINIMUM AMOUNT OF EURODOLLAR LOANS . . . . . . . . . . . . . .17
SECTION 2.7 CONVERSION OR CONTINUATION . . . . . . . . . . . . . . . . . .18
SECTION 2.8 VOLUNTARY REDUCTION OF COMMITMENTS . . . . . . . . . . . . . .18
SECTION 2.9 VOLUNTARY PREPAYMENTS. . . . . . . . . . . . . . . . . . . . .18
SECTION 2.10 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .18
SECTION 2.11 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .19
SECTION 2.12 METHOD AND PLACE OF PAYMENT. . . . . . . . . . . . . . . . . .19
SECTION 2.13 FEES . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19
SECTION 2.14 INTEREST RATE UNASCERTAINABLE, INCREASED COSTS,
ILLEGALITY . . . . . . . . . . . . . . . . . . . . . . . . . .19
SECTION 2.15 FUNDING LOSSES . . . . . . . . . . . . . . . . . . . . . . . .21
SECTION 2.16 INCREASED CAPITAL. . . . . . . . . . . . . . . . . . . . . . .21
SECTION 2.17 TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . .22
SECTION 2.18 CHANGE OF OFFICE, ETC. . . . . . . . . . . . . . . . . . . . .23
SECTION 2.19 USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 3 LETTERS OF CREDIT
SECTION 3.1 DRAWING UNDER LETTERS OF CREDIT. . . . . . . . . . . . . . . .23
SECTION 3.2 CASH COLLATERAL. . . . . . . . . . . . . . . . . . . . . . . .23
SECTION 3.3 INSTRUMENTS OF ASSIGNMENT. . . . . . . . . . . . . . . . . . .23
SECTION 3.4 REPLACEMENT OF LETTERS OF CREDIT . . . . . . . . . . . . . . .23
SECTION 4 CONDITIONS PRECEDENT
SECTION 4.1 CONDITIONS PRECEDENT TO INITIAL ADVANCES . . . . . . . . . . .24
SECTION 4.2 CONDITIONS TO EACH ADVANCE . . . . . . . . . . . . . . . . . .25
SECTION 4.3 METHOD OF DELIVERY . . . . . . . . . . . . . . . . . . . . . .26
SECTION 5 REPRESENTATIONS AND WARRANTIES
SECTION 5.1 CORPORATE STATUS . . . . . . . . . . . . . . . . . . . . . . .26
SECTION 5.2 CORPORATE POWER AND AUTHORITY. . . . . . . . . . . . . . . . .26
SECTION 5.3 NO VIOLATION . . . . . . . . . . . . . . . . . . . . . . . . .26
SECTION 5.4 LITIGATION . . . . . . . . . . . . . . . . . . . . . . . . . .27
SECTION 5.5 FINANCIAL STATEMENTS; FINANCIAL CONDITION; ETC . . . . . . . .27
SECTION 5.6 SOLVENCY . . . . . . . . . . . . . . . . . . . . . . . . . . .27
SECTION 5.7 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .27
SECTION 5.8 MATERIAL ADVERSE CHANGE. . . . . . . . . . . . . . . . . . . .27
SECTION 5.9 USE OF PROCEEDS; MARGIN REGULATIONS. . . . . . . . . . . . . .27
SECTION 5.10 GOVERNMENTAL APPROVALS . . . . . . . . . . . . . . . . . . . .27
SECTION 5.11 SECURITY INTERESTS AND LIENS . . . . . . . . . . . . . . . . .27
SECTION 5.12 TAX RETURNS AND PAYMENTS . . . . . . . . . . . . . . . . . . .28
SECTION 5.13 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .28
SECTION 5.14 INVESTMENT COMPANY ACT; PUBLIC UTILITY HOLDING
COMPANY ACT. . . . . . . . . . . . . . . . . . . . . . . . . .28
SECTION 5.15 REPRESENTATIONS AND WARRANTIES IN TRANSACTION
DOCUMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . .28
SECTION 5.16 TRUE AND COMPLETE DISCLOSURE; FINANCIAL STATEMENTS . . . . . .28
SECTION 5.17 CORPORATE STRUCTURE; CAPITALIZATION. . . . . . . . . . . . . .28
SECTION 5.18 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .29
SECTION 5.19 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .29
SECTION 5.20 PATENTS, TRADEMARKS, ETC . . . . . . . . . . . . . . . . . . .29
SECTION 5.21 OWNERSHIP OF PROPERTY. . . . . . . . . . . . . . . . . . . . .29
SECTION 5.22 NO DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . .30
SECTION 5.23 LICENSES, ETC. . . . . . . . . . . . . . . . . . . . . . . . .30
SECTION 5.24 COMPLIANCE WITH LAW. . . . . . . . . . . . . . . . . . . . . .30
SECTION 5.25 NO BURDENSOME RESTRICTIONS . . . . . . . . . . . . . . . . . .30
SECTION 5.26 BROKERS' FEES. . . . . . . . . . . . . . . . . . . . . . . . .30
SECTION 5.27 LABOR MATTERS. . . . . . . . . . . . . . . . . . . . . . . . .30
SECTION 6 AFFIRMATIVE COVENANTS
SECTION 6.1 INFORMATION COVENANTS. . . . . . . . . . . . . . . . . . . . .30
(a) Annual Financial Statements . . . . . . . . . .30
(b) Quarterly Financial Statements. . . . . . . . .31
(c) [This Section deliberately left blank]. . . . .31
(d) Management Letters. . . . . . . . . . . . . . .31
(e) Financial Projections . . . . . . . . . . . . .31
(f) Certificates. . . . . . . . . . . . . . . . . .31
(g) Notice of Default or Litigation . . . . . . . .32
(h) [This Section deliberately left blank]. . . . .32
(i) SEC Filings . . . . . . . . . . . . . . . . . .32
(j) [This Section deliberately left blank]. . . . .32
(k) Refinancings. . . . . . . . . . . . . . . . . .32
(l) Charter Documents . . . . . . . . . . . . . . .32
(m) Notice of Dissolution . . . . . . . . . . . . .32
ii
(n) [This Section deliberately left blank]. . . . .32
(o) Other Information . . . . . . . . . . . . . . .32
SECTION 6.2 BOOKS, RECORDS AND INSPECTIONS . . . . . . . . . . . . . . . .32
SECTION 6.3 MAINTENANCE OF INSURANCE . . . . . . . . . . . . . . . . . . .32
SECTION 6.4 TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . .33
SECTION 6.5 CORPORATE FRANCHISES . . . . . . . . . . . . . . . . . . . . .33
SECTION 6.6 COMPLIANCE WITH LAW. . . . . . . . . . . . . . . . . . . . . .33
SECTION 6.7 PERFORMANCE OF OBLIGATIONS . . . . . . . . . . . . . . . . . .33
SECTION 6.8 MAINTENANCE OF PROPERTIES. . . . . . . . . . . . . . . . . . .33
SECTION 6.9 LICENSES, PERMITS, ETC . . . . . . . . . . . . . . . . . . . .34
SECTION 6.10 ENVIRONMENTAL REPORTS. . . . . . . . . . . . . . . . . . . . .34
SECTION 6.11 APPRAISALS . . . . . . . . . . . . . . . . . . . . . . . . . .34
SECTION 6.12 ADDITIONAL GUARANTORS. . . . . . . . . . . . . . . . . . . . .34
SECTION 6.13 AMF INSURANCE COMPANY OF BERMUDA LTD . . . . . . . . . . . . .34
SECTION 6.14 COVENANT TO GIVE SECURITY. . . . . . . . . . . . . . . . . . .35
SECTION 6.15 COVENANT TO PROVIDE CERTIFICATE OF INSURANCE . . . . . . . . .35
SECTION 6.16 COVENANT TO PROVIDE FINANCING STATEMENTS . . . . . . . . . . .35
SECTION 6.17 COVENANT TO PROVIDE SUBORDINATION AGREEMENTS . . . . . . . . .35
SECTION 7 NEGATIVE COVENANTS
SECTION 7.1 INDEBTEDNESS . . . . . . . . . . . . . . . . . . . . . . . . .36
SECTION 7.2 LIENS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .37
SECTION 7.3 RESTRICTION ON FUNDAMENTAL CHANGES . . . . . . . . . . . . . .38
SECTION 7.4 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .38
SECTION 7.5 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .38
SECTION 7.6 DIVIDENDS. . . . . . . . . . . . . . . . . . . . . . . . . . .38
SECTION 7.7 ADVANCES AND INVESTMENTS . . . . . . . . . . . . . . . . . . .39
SECTION 7.8 TRANSACTIONS WITH AFFILIATES . . . . . . . . . . . . . . . . .40
SECTION 7.9 LIMITATION ON VOLUNTARY PAYMENTS AND MODIFICATIONS OF
CERTAIN DOCUMENTS. . . . . . . . . . . . . . . . . . . . . . .41
SECTION 7.10 CHANGES IN BUSINESS. . . . . . . . . . . . . . . . . . . . . .41
SECTION 7.11 CERTAIN RESTRICTIONS . . . . . . . . . . . . . . . . . . . . .41
SECTION 7.12 LEASE PAYMENTS . . . . . . . . . . . . . . . . . . . . . . . .41
SECTION 7.13 SALES AND LEASEBACKS . . . . . . . . . . . . . . . . . . . . .41
SECTION 7.14 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .41
SECTION 7.15 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .41
SECTION 7.16 [THIS SECTION DELIBERATELY LEFT BLANK] . . . . . . . . . . . .42
SECTION 7.17 INACTIVE SUBSIDIARIES. . . . . . . . . . . . . . . . . . . . .42
SECTION 8 EVENTS OF DEFAULT
SECTION 8.1 EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . .42
(a) Failure to Make Payments . . . . . . . . . . .42
(b) Breach of Representation or Warranty. . . . . .42
(c) Breach of Covenants . . . . . . . . . . . . . .42
(d) Acceleration Under Other Agreements . . . . . .42
iii
(e) Bankruptcy, etc . . . . . . . . . . . . . . . .43
(f) Subordinated Debt Financing Documents . . . . .43
(g) Restricted Subsidiaries . . . . . . . . . . . .43
(h) Letters of Credit; Collateral Account
Agreements. . . . . . . . . . . . . . . . . . .43
(i) [This Section deliberately left blank]. . . . .43
(j) Security Documents. . . . . . . . . . . . . . .43
(k) Guaranty. . . . . . . . . . . . . . . . . . . .44
(l) Change of Control . . . . . . . . . . . . . . .44
(m) Judgments . . . . . . . . . . . . . . . . . . .44
(n) [This Section deliberately left blank]. . . . .44
(o) Use of Proceeds . . . . . . . . . . . . . . . .44
SECTION 8.2 RIGHTS AND REMEDIES. . . . . . . . . . . . . . . . . . . . . .44
SECTION 9 THE AGENT
SECTION 9.1 APPOINTMENT. . . . . . . . . . . . . . . . . . . . . . . . . .45
SECTION 9.2 DELEGATION OF DUTIES . . . . . . . . . . . . . . . . . . . . .45
SECTION 9.3 EXCULPATORY PROVISIONS . . . . . . . . . . . . . . . . . . . .45
SECTION 9.4 RELIANCE BY AGENT. . . . . . . . . . . . . . . . . . . . . . .46
SECTION 9.5 NOTICE OF DEFAULT. . . . . . . . . . . . . . . . . . . . . . .46
SECTION 9.6 NON-RELIANCE ON AGENT AND OTHER LENDERS. . . . . . . . . . . .46
SECTION 9.7 INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . . . . .47
SECTION 9.8 AGENT IN ITS INDIVIDUAL CAPACITY . . . . . . . . . . . . . . .47
SECTION 9.9 SUCCESSOR AGENT. . . . . . . . . . . . . . . . . . . . . . . .47
SECTION 9.10 INTERPRETATION . . . . . . . . . . . . . . . . . . . . . . . .48
SECTION 10 MISCELLANEOUS
SECTION 10.1 PAYMENT OF EXPENSES, INDEMNITY, ETC. . . . . . . . . . . . . .48
SECTION 10.2 RIGHT OF SETOFF. . . . . . . . . . . . . . . . . . . . . . . .49
SECTION 10.3 NOTICES. . . . . . . . . . . . . . . . . . . . . . . . . . . .50
SECTION 10.4 SUCCESSORS AND ASSIGNS; PARTICIPATION; ASSIGNMENTS . . . . . .50
(a) Successors and Assigns. . . . . . . . . . . . .50
(b) Participation . . . . . . . . . . . . . . . . .50
(c) Assignments . . . . . . . . . . . . . . . . . .51
(d) Disclosure of Information . . . . . . . . . . .52
SECTION 10.5 AMENDMENTS AND WAIVERS . . . . . . . . . . . . . . . . . . . .52
SECTION 10.6 NO WAIVER; REMEDIES CUMULATIVE . . . . . . . . . . . . . . . .53
SECTION 10.7 SHARING OF PAYMENTS. . . . . . . . . . . . . . . . . . . . . .53
SECTION 10.8 GOVERNING LAW; SUBMISSION TO JURISDICTION. . . . . . . . . . .53
SECTION 10.9 COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . . . . .54
SECTION 10.10 EFFECTIVENESS. . . . . . . . . . . . . . . . . . . . . . . . .54
SECTION 10.11 HEADINGS DESCRIPTIVE . . . . . . . . . . . . . . . . . . . . .54
SECTION 10.12 MARSHALLING; RECAPTURE . . . . . . . . . . . . . . . . . . . .54
SECTION 10.13 SEVERABILITY . . . . . . . . . . . . . . . . . . . . . . . . .54
SECTION 10.14 SURVIVAL . . . . . . . . . . . . . . . . . . . . . . . . . . .54
SECTION 10.15 DOMICILE OF LOANS. . . . . . . . . . . . . . . . . . . . . . .54
iv
SECTION 10.16 LIMITATION OF LIABILITY. . . . . . . . . . . . . . . . . . . .55
SECTION 10.17 CALCULATIONS; COMPUTATIONS . . . . . . . . . . . . . . . . . .55
SECTION 10.18 WAIVER OF TRIAL BY JURY. . . . . . . . . . . . . . . . . . . .55
SECTION 11 SUBORDINATION OF OBLIGATIONS
SECTION 11.1 OBLIGATIONS SUBORDINATE TO SENIOR INDEBTEDNESS . . . . . . . .55
SECTION 11.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC . . . . . . . .55
SECTION 11.3 SUSPENSION OF PAYMENT WHEN SENIOR INDEBTEDNESS IN
DEFAULT. . . . . . . . . . . . . . . . . . . . . . . . . . . .57
SECTION 11.4 APPLICATION OF MONIES DEPOSITED. . . . . . . . . . . . . . . .58
SECTION 11.5 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS. . . .58
SECTION 11.6 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. . . . . . . . . .58
SECTION 11.7 AGENT TO EFFECTUATE SUBORDINATION. . . . . . . . . . . . . . .59
SECTION 11.8 NO WAIVER OF SUBORDINATION PROVISIONS. . . . . . . . . . . . .59
SECTION 11.9 NOTICE TO AGENT. . . . . . . . . . . . . . . . . . . . . . . .59
SECTION 11.10 RIGHTS OF AGENT AS A HOLDER OF SENIOR INDEBTEDNESS,
PRESERVATION OF AGENT'S RIGHTS . . . . . . . . . . . . . . . .60
SECTION 11.11 NO SUSPENSION OF REMEDIES. . . . . . . . . . . . . . . . . . .60
SECTION 11.12 RELATION OF HOLDERS OF SENIOR INDEBTEDNESS . . . . . . . . . .61
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ANNEXES
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I Lenders and Commitments
SCHEDULES
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1.1(a) Mortgaged Property
1.1(b) Permitted Organizational Changes
1.1(c) Restricted Subsidiaries
4.1(d) Environmental Liabilities
5.5 Contingent Liabilities
5.10 Governmental Approvals
5.11 Prior Security Interest
5.17 Corporate Structure
5.21(a)(i) Real Property
5.21(a)(ii) Immaterial Real Property
5.21(b) Property Conditions
7.1 Indebtedness
7.2 Permitted Liens
7.7 Investments
EXHIBITS
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1.1(a) Form of Letter of Credit
1.1(b) Form of Guaranty
1.1(c) Form of Pledge Agreement
1.1(d) Form of Security Agreement
1.1(e) Forms of Subordination Agreements
1.1(f) Form of Trademark Security Agreement
2.1 Form of Note
2.2 Form of Notice of Borrowing
7.3(a) Form of Permitted Organizational Change Certificate
10.4(c) Form of Transfer Supplement
