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EXHIBIT 10.15
$100,000,000.00
CREDIT AGREEMENT
dated as of
February 28, 1997
among
KAYDON CORPORATION
The Banks Listed Herein
and
WACHOVIA BANK OF GEORGIA, N.A.,
as Agent and a Bank
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TABLE OF CONTENTS
CREDIT AGREEMENT
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions........................................................................................1
SECTION 1.02. Accounting Terms and Determinations...............................................................11
SECTION 1.03. Use of Defined Terms..............................................................................11
SECTION 1.04. Terminology.......................................................................................11
SECTION 1.05. References........................................................................................11
ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Loans.........................................................................12
SECTION 2.02. Method of Borrowing Loans.........................................................................12
SECTION 2.03. Notes.............................................................................................14
SECTION 2.04. Maturity of Loans.................................................................................14
SECTION 2.05. Interest Rates....................................................................................14
SECTION 2.06. Fees..............................................................................................16
SECTION 2.07. Optional Termination or Reduction of Commitments..................................................18
SECTION 2.08. Mandatory Reduction and Termination of Commitments................................................18
SECTION 2.09. Optional Prepayments..............................................................................18
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SECTION 2.10. Mandatory Prepayments.............................................................................18
SECTION 2.11. General Provisions as to Payments.................................................................18
SECTION 2.12. Computation of Interest and Fees..................................................................20
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing.....................................................................20
SECTION 3.02. Conditions to All Borrowings......................................................................21
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Corporate Existence and Power.....................................................................22
SECTION 4.02. Corporate and Governmental Authorization; No Contravention........................................22
SECTION 4.03. Binding Effect....................................................................................22
SECTION 4.04. Financial Information.............................................................................22
SECTION 4.05. Litigation........................................................................................22
SECTION 4.06. Compliance with ERISA.............................................................................23
SECTION 4.07. Taxes.............................................................................................23
SECTION 4.08. Subsidiaries......................................................................................23
SECTION 4.09. Not an Investment Company.........................................................................23
SECTION 4.10 Public Utility Holding Company Act................................................................23
SECTION 4.11. Ownership of Property; Liens......................................................................24
SECTION 4.12. No Default........................................................................................24
SECTION 4.13. Full Disclosure...................................................................................24
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SECTION 4.14. Environmental Matters............................................................................24
SECTION 4.15. Compliance with Laws..............................................................................24
SECTION 4.16. Capital Stock.....................................................................................25
SECTION 4.17. Margin Stock......................................................................................25
SECTION 4.18. Insolvency........................................................................................25
ARTICLE V
COVENANTS
SECTION 5.01. Information.......................................................................................25
SECTION 5.02. Inspection of Property, Books and Records.........................................................27
SECTION 5.03. Ratio of Consolidated Total Debt to Total Capitalization. .......................................27
SECTION 5.04. Interest Coverage.................................................................................27
SECTION 5.05. Loans or Advances.................................................................................27
SECTION 5.06. Investments.......................................................................................28
SECTION 5.07. Negative Pledge...................................................................................28
SECTION 5.08. Maintenance of Existence..........................................................................29
SECTION 5.09. Dissolution.......................................................................................29
SECTION 5.10. Consolidations, Mergers and Sales of Assets.......................................................29
SECTION 5.11. Use of Proceeds...................................................................................30
SECTION 5.12. Compliance with Laws; Payment of Taxes............................................................30
SECTION 5.13. Insurance.........................................................................................30
SECTION 5.14. Change in Fiscal Year.............................................................................30
SECTION 5.15. Maintenance of Property...........................................................................30
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SECTION 5.16. Environmental Notices.............................................................................30
SECTION 5.17. Environmental Matters.............................................................................30
SECTION 5.18. Environmental Release.............................................................................31
SECTION 5.19. Debt..............................................................................................31
SECTION 5.20. Transactions with Affiliates......................................................................31
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default.................................................................................31
SECTION 6.02. Notice of Default.................................................................................34
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities................................................................34
SECTION 7.02. Reliance by Agent.................................................................................34
SECTION 7.03. Defaults..........................................................................................35
SECTION 7.04. Rights of Agent and Its Affiliates as a Bank......................................................35
SECTION 7.05. Indemnification...................................................................................35
SECTION 7.06. Consequential Damages.............................................................................36
SECTION 7.07. Payee of Note Treated as Owner....................................................................36
SECTION 7.08. Non-Reliance on Agent and Other Banks.............................................................36
SECTION 7.09. Failure to Act....................................................................................36
SECTION 7.10. Resignation or Removal of Agent...................................................................36
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ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate or Unfair..........................................37
SECTION 8.02. Illegality........................................................................................37
SECTION 8.03. Increased Cost and Reduced Return.................................................................38
SECTION 8.04. Base Rate Loans Substituted for Affected Euro-Dollar Loans........................................39
SECTION 8.05. Compensation......................................................................................40
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices...........................................................................................40
SECTION 9.02. No Waivers........................................................................................40
SECTION 9.03. Expenses; Documentary Taxes; Indemnification......................................................41
SECTION 9.04. Set-Offs; Sharing of Set-Offs.....................................................................41
SECTION 9.05. Amendments and Waivers............................................................................42
SECTION 9.06. Margin Stock Collateral...........................................................................43
SECTION 9.07. Successors and Assigns............................................................................43
SECTION 9.08. Confidentiality...................................................................................45
SECTION 9.09. Representation by Banks...........................................................................45
SECTION 9.10. Obligations Several...............................................................................45
SECTION 9.11. Survival of Certain Obligations...................................................................45
SECTION 9.12. Georgia Law.......................................................................................45
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SECTION 9.13. Severability......................................................................................45
SECTION 9.14. Interest..........................................................................................46
SECTION 9.15. Interpretation....................................................................................46
SECTION 9.16. Consent to Jurisdiction...........................................................................46
SECTION 9.17. Counterparts......................................................................................46
EXHIBIT A Form of Note
EXHIBIT B-1 Form of Opinion of Counsel for the Borrower
EXHIBIT B-2 Form of Opinion of Florida Counsel for the Borrower
EXHIBIT C Form of Opinion of Special Counsel for the Agent
EXHIBIT D Form of Closing Certificate
EXHIBIT E Form of Secretary's Certificate
EXHIBIT F Form of Compliance Certificate
EXHIBIT G Form of Assignment and Acceptance
EXHIBIT H Form of Notice of Borrowing
Schedule 4.05 - Fraudulent Transfer Litigation and Products Liability Matters
Schedule 4.08 - Subsidiaries
Schedule 5.19 - Existing Debt
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CREDIT AGREEMENT
AGREEMENT dated as of February 28, 1997, among KAYDON
CORPORATION, the BANKS listed on the signature pages hereof and WACHOVIA BANK OF
GEORGIA, N.A., as Agent and as a Bank.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. The terms as defined in this
Section 1.01 shall, for all purposes of this Agreement and any amendment hereto
(except as herein otherwise expressly provided or unless the context otherwise
requires), have the meanings set forth herein:
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.05(c).
"Affiliate" of any Person means (i) any other Person which
directly, or indirectly through one or more intermediaries, controls such
Person, (ii) any other Person which directly, or indirectly through one or more
intermediaries, is controlled by or is under common control with such Person, or
(iii) any other Person of which such Person owns, directly or indirectly, 20% or
more of the common stock or equivalent equity interests. As used herein, the
term "control" means possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agent" means Wachovia Bank of Georgia, N.A., a national
banking association organized under the laws of the United States of America, in
its capacity as agent for the Banks hereunder, and its successors and permitted
assigns in such capacity.
"Agent's Letter Agreement" means that certain letter
agreement, dated as of December 11, 1996, between the Borrower and the Agent
relating to the structure of the Loans, and certain fees from time to time
payable by the Borrower to the Agent, together with all amendments and
modifications thereto.
"Agreement" means this Credit Agreement, together with all
amendments and supplements hereto.
"Applicable Unused Fee Rate" has the meaning set forth in
Section 2.06(a).
"Applicable Margin" has the meaning set forth in Section
2.05(a).
"Assignee" has the meaning set forth in Section 9.07(c).
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"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.07(c) in the form attached hereto as
Exhibit G.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate
per annum equal to the higher as of such day of (i) the Prime Rate or (ii)
one-half of one percent above the Federal Funds Rate for such day. For purposes
of determining the Base Rate for any day, changes in the Prime Rate and the
Federal Funds Rate shall be effective on the date of each such change.
"Base Rate Loan" means a Loan which bears or is to bear
interest at a rate based upon the Base Rate.
"Borrower" means Kaydon Corporation, a Delaware corporation,
and its successors and permitted assigns.
"Borrowing" means a borrowing hereunder consisting of Loans
made to the Borrower at the same time by the Banks pursuant to Article II. A
Borrowing is a "Base Rate Borrowing" if such Loans are Base Rate Loans or a
"Euro-Dollar Borrowing" if such Loans are Euro-Dollar Loans.
"Capital Stock" means any nonredeemable capital stock of the
Borrower or any Consolidated Subsidiary (to the extent issued to a Person other
than the Borrower), whether common or preferred.
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C. ss.9601 et seq. and its implementing
regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Information System established pursuant to CERCLA.
"Change of Law" shall have the meaning set forth in Section
8.02.
"Closing Certificate" has the meaning set forth in Section
3.01(e).
"Closing Date" means February 28, 1997.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code. Any reference to any provision of the Code shall
also be deemed to be a reference to any successor provision or provisions
thereof.
"Commitment" means, with respect to each Bank, (i) the amount
set forth opposite the name of such Bank on the signature pages hereof, or (ii)
as to any Bank which enters into an
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Assignment and Acceptance (whether as transferor Bank or as Assignee
thereunder), the amount of such Bank's Commitment after giving effect to such
Assignment and Acceptance, in each case as such amount may be reduced from time
to time pursuant to Sections 2.07 and 2.08.
"Compliance Certificate" has the meaning set forth in Section
5.01(c).
"Consolidated Interest Expense" for any period means interest,
whether expensed or capitalized, in respect of Debt of the Borrower or any of
its Consolidated Subsidiaries outstanding during such period.
"Consolidated Net Income" means, for any period, the Net
Income of the Borrower and its Consolidated Subsidiaries determined on a
consolidated basis, but excluding (i) extraordinary items and (ii) any equity
interests of the Borrower or any Subsidiary in the unremitted earnings of any
Person that is not a Subsidiary.
"Consolidated Net Worth" means, at any time, Stockholders'
Equity.
"Consolidated Operating Profits" means, for any period, the
Operating Profits of the Borrower and its Consolidated Subsidiaries.
"Consolidated Subsidiary" means at any date any Subsidiary or
other entity the accounts of which, in accordance with GAAP, would be
consolidated with those of the Borrower in its consolidated financial statements
as of such date.
"Consolidated Total Assets" means, at any time, the total
assets of the Borrower and its Consolidated Subsidiaries, determined on a
consolidated basis, as set forth or reflected on the most recent consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries, prepared in
accordance with GAAP.
"Consolidated Total Debt" means at any date the Debt of the
Borrower and its Consolidated Subsidiaries, determined on a consolidated basis
as of such date.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, are treated as a single
employer under Section 414 of the Code.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations of
such Person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such Person to pay the deferred purchase price of
property or services, except trade accounts payable arising in the ordinary
course of business, (iv) all obligations of such Person as lessee under capital
leases, (v) all obligations of such Person to reimburse any bank or other Person
in respect of amounts payable under a banker's acceptance, (vi) all Redeemable
Preferred Stock of such Person (in the event such Person is a corporation),
(vii) all obligations (absolute or contingent) of such Person to reimburse any
bank or other Person in respect of amounts paid under a letter of credit or
similar instrument, with an expiration date more than one
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year from such date, (viii) all Debt of others secured by a Lien on any asset of
such Person, whether or not such Debt is assumed by such Person, and (ix) all
Debt of others Guaranteed by such Person.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or both
would, unless cured or waived in writing, become an Event of Default.
"Default Rate" means, with respect to any Loan, on any day,
the sum of 2% plus the then highest interest rate (including the Applicable
Margin) which may be applicable to any Loans hereunder (irrespective of whether
any such type of Loans are actually outstanding hereunder).
"Dollars" or "$" means dollars in lawful currency of the
United States of America.
"Domestic Business Day" means any day except a Saturday,
Sunday or other day on which commercial banks in Georgia are authorized or
required by law to close.
"EBIT" for any period means the sum of: (i) Consolidated Net
Income, (ii) taxes on income, and (iii) Consolidated Interest Expense, all
determined with respect to the Borrower and its Consolidated Subsidiaries on a
consolidated basis for such period and in accordance with GAAP.
"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction or
authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal prerequisites for
conducting the business of the Borrower or any Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means all judgments,
decrees or orders arising from or in any way associated with any Environmental
Requirements, whether or not entered upon consent or written agreements with an
Environmental Authority or other entity arising from or in any way associated
with any Environmental Requirement, whether or not incorporated in a judgment,
decree or order.
"Environmental Laws" means any and all federal, state, local
and foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or other
governmental restrictions relating to the environment or to emissions,
discharges or releases of pollutants, contaminants, petroleum or petroleum
products, chemicals or industrial, toxic or hazardous substances or wastes into
the environment, including, without limitation, ambient air, surface water,
groundwater or land, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
pollutants, contaminants, petroleum or petroleum products, chemicals or
industrial, toxic or hazardous substances or wastes or the clean-up or other
remediation thereof.
"Environmental Liabilities" means any liabilities, whether
accrued, contingent or otherwise, arising from and in any way associated with
any Environmental Requirements.
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"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged noncompliance
with or liability under any Environmental Requirement, including without
limitation any complaints, citations, demands or requests from any Environmental
Authority or from any other person or entity for correction of any violation of
any Environmental Requirement or any investigations concerning any violation of
any Environmental Requirement.
"Environmental Proceedings" means any judicial or
administrative proceedings arising from or in any way associated with any
Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA
or under any applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement
relating to health, safety or the environment and applicable to the Borrower,
any Subsidiary or the Properties, including but not limited to any such
requirement under CERCLA or similar state legislation and all federal, state and
local laws, ordinances, regulations, orders, writs, decrees and common law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor law. Any reference to any
provision of ERISA shall also be deemed to be a reference to any successor
provision or provisions thereof.
"Euro-Dollar Business Day" means any Domestic Business Day on
which dealings in Dollar deposits are carried out in the London interbank
market.
"Euro-Dollar Loan" means a Loan which bears or is to bear
interest at a rate based upon the London Interbank Offered Rate.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.05(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%) equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank of New York on the Domestic
Business Day next succeeding such day, provided that (i) if the day for which
such rate is to be determined is not a Domestic Business Day, the Federal Funds
Rate for such day shall be such rate on such transactions on the next preceding
Domestic Business Day as so published on the next succeeding Domestic Business
Day, and (ii) if such rate is not so published for any day, the Federal Funds
Rate for such day shall be the average rate charged to Wachovia on such day on
such transactions as determined by the Agent.
"Fiscal Quarter" means any fiscal quarter of the Borrower.
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"Fiscal Year" means any fiscal year of the Borrower.
"Fraudulent Transfer Litigation and Products Liability
Matters" means the litigation and products liability matters, as more fully set
forth and described on Schedule 4.05.
"GAAP" means generally accepted accounting principles applied
on a basis consistent with those which, in accordance with Section 1.02, are to
be used in making the calculations for purposes of determining compliance with
the terms of this Agreement.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or other
obligation of any other Person and, without limiting the generality of the
foregoing, any obligation, direct or indirect, contingent or otherwise, of such
Person (i) to secure, purchase or pay (or advance or supply funds for the
purchase or payment of) such Debt or other obligation (whether arising by virtue
of partnership arrangements, by agreement to keep-well, to purchase assets,
goods, securities or services, to provide collateral security, to take-or-pay,
or to maintain financial statement conditions or otherwise) or (ii) entered into
for the purpose of assuring in any other manner the obligee of such Debt or
other obligation of the payment thereof or to protect such obligee against loss
in respect thereof (in whole or in part), provided that the term Guarantee shall
not include endorsements for collection or deposit in the ordinary course of
business. The term "Guarantee" used as a verb has a corresponding meaning.
"Hazardous Materials" includes, without limitation, (a) solid
or hazardous waste, as defined in the Resource Conservation and Recovery Act of
1980, 42 U.S.C. ss.6901 et seq. and its implementing regulations and amendments,
or in any applicable state or local law or regulation, (b) any "hazardous
substance", "pollutant" or "contaminant", as defined in CERCLA, or in any
applicable state or local law or regulation, (c) gasoline, or any other
petroleum product or by-product, including crude oil or any fraction thereof,
(d) toxic substances, as defined in the Toxic Substances Control Act of 1976, or
in any applicable state or local law or regulation and (e) insecticides,
fungicides, or rodenticides, as defined in the Federal Insecticide, Fungicide,
and Rodenticide Act of 1975, or in any applicable state or local law or
regulation, as each such Act, statute or regulation may be amended from time to
time.
"Indicative Rate" means the rate, if any, which the Agent has
provided to the Borrower on the date that the Borrower provides the Agent with a
Notice of Borrowing, as being the Base Rate or Adjusted London Interbank Offered
Rate, effective on the date of such Notice of Borrowing. The Indicative Rate is
not binding on the Agent or any Bank and the interest rate applicable to a
Borrowing may be greater than, equal to or less than the Indicative Rate.
"Interest Coverage Ratio" means the ratio, measured as of the
last day of each Fiscal Quarter, of EBIT for the Fiscal Quarter then ended and
the immediately preceding three Fiscal Quarters to Consolidated Interest Expense
for the Fiscal Quarter then ended and the immediately preceding three Fiscal
Quarters.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending on the
numerically corresponding day in the
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first, second, third or sixth month thereafter, as the Borrower may elect in the
applicable Notice of Borrowing; provided that:
(a) any Interest Period (subject to clause (c) below) which
would otherwise end on a day which is not a Euro-Dollar Business Day
shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month,
in which case such Interest Period shall end on the next preceding
Euro-Dollar Business Day;
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the appropriate subsequent calendar
month) shall, subject to clause (c) below, end on the last Euro-Dollar
Business Day of the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
(2) with respect to each Base Rate Borrowing, the period commencing on the
date of such Borrowing and ending 30 days thereafter; provided that:
(a) any Interest Period (subject to clause (b) below) which
would otherwise end on a day which is not a Domestic Business Day shall
be extended to the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date.
"Investment" means any investment in any Person, whether by
means of purchase or acquisition of obligations or securities of such Person,
capital contribution to such Person, loan or advance to such Person, making of a
time deposit with such Person, Guarantee or assumption of any obligation of such
Person or otherwise.
"Lending Office" means, as to each Bank, its office located at
its address set forth on the signature pages hereof (or identified on the
signature pages hereof as its Lending Office) or such other office as such Bank
may hereafter designate as its Lending Office by Notice to the Borrower and the
Agent.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest, security
title, preferential arrangement which has the practical effect of constituting a
security interest or encumbrance, servitude or encumbrance of any kind in
respect of such asset to secure or assure payment of a Debt or a Guarantee,
whether by consensual agreement or by operation of statute or other law, or by
any agreement, contingent or otherwise, to provide any of the foregoing. For the
purposes of this Agreement, the Borrower or any Subsidiary shall be deemed to
own subject to a Lien any asset which it has acquired or holds subject to the
interest of a vendor or lessor under any conditional sale agreement, capital
lease or other title retention agreement relating to such asset.
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"Loan" means a Base Rate Loan or a Euro-Dollar Loan and Loans
means Base Rate Loans or Euro-Dollar Loans, or any or all of them, as the
context shall require.
"Loan Documents" means this Agreement, the Notes, any other
document evidencing, relating to or securing the Loans, and any other document
or instrument delivered from time to time in connection with this Agreement, the
Notes or the Loans, as such documents and instruments may be amended or
supplemented from time to time.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.05(c).
"Margin Stock" means "margin stock" as defined in Regulation
G, T, U or X of the Board of Governors of the Federal Reserve System, as in
effect from time to time, together with all official rulings and interpretations
issued thereunder.
"Material Adverse Effect" means with respect to any event,
act, condition or occurrence of whatever nature (including, without limitation,
any adverse change, development or determination in any litigation, arbitration,
or governmental investigation or proceeding (including, without limitation, any
action, proceeding, claim or other matter included in the Fraudulent Transfer
Litigation and Products Liability Matters)), whether singly or in conjunction
with any other event or events, act or acts, condition or conditions, occurrence
or occurrences, whether or not related, a material adverse change in, or a
material adverse effect upon, any of (a) the financial condition, operations,
business, properties or prospects of the Borrower or any of its Consolidated
Subsidiaries, (b) the rights and remedies of the Agent or the Banks under the
Loan Documents, or the ability of the Borrower to perform its obligations under
the Loan Documents to which it is a party, as applicable, or (c) the legality,
validity or enforceability of any Loan Document.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"Net Income" means, as applied to any Person for any period,
the aggregate amount of net income of such Person, after taxes, for such period,
as determined in accordance with GAAP.
"Net Proceeds of Capital Stock" means any and all proceeds
(whether cash or non-cash) or other consideration received by the Borrower or a
Consolidated Subsidiary in respect of the issuance of Capital Stock (including,
without limitation, the aggregate amount of any and all Debt converted into
Capital Stock), after deducting therefrom all reasonable and customary costs and
expenses incurred by the Borrower or such Consolidated Subsidiary directly in
connection with the issuance of such Capital Stock.
"Notes" means any or all of the promissory notes of the
Borrower, substantially in the form of Exhibit A hereto, evidencing the
obligation of the Borrower to repay the Loans, together with all amendments,
consolidations, modifications, renewals and supplements thereto and "Note" means
any one of such Notes.
"Notice" means a notice, request or other communication to a
party hereunder which shall be given and deemed effective in accordance with
Section 9.01.
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"Notice of Borrowing" has the meaning set forth in Section
2.02.
"Officer's Certificate" has the meaning set forth in Section
3.01(f).
"Operating Profits" means, as applied to any Person for any
period, the operating income of such Person for such period, as determined in
accordance with GAAP.
"Participant" has the meaning set forth in Section 9.07(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Permitted Acquisition" means the acquisition by the Borrower
or any Subsidiary of the Borrower of shares of capital stock of any Person or
assets from any Person, if: (A) in the case of the acquisition of shares of
capital stock of any Person, immediately after giving effect to such acquisition
(i) such Person is a Consolidated Subsidiary; (ii) the Borrower controls such
Person directly or indirectly through a Subsidiary; (iii) no Default shall have
occurred and be continuing; (iv) the line or lines of business engaged in by
such Person are reasonably related, supportive or incidental to the lines of
business engaged in by the Borrower and its Subsidiaries on the Closing Date;
and (v) such acquisition is made on a negotiated basis with the approval of the
Board of Directors of the Person to be acquired and, if necessary, the
shareholders of the Person to be acquired; and (B) in the case of the
acquisition of assets from any Person, immediately after giving effect to such
acquisition: (i) the assets acquired by the Borrower or such Subsidiary of the
Borrower, shall be used by the Borrower or such Subsidiary in a line of business
reasonably related, supportive or incidental to the lines of business engaged in
by the Borrower and its Subsidiaries on the Closing Date; and (ii) no Default
shall have occurred and be continuing.
"Person" means an individual, a corporation, a limited
liability company, a partnership (including without limitation, a joint
venture), an unincorporated association, a trust or any other entity or
organization, including, but not limited to, a government or political
subdivision or an agency or instrumentality thereof.
"Plan" means at any time an employee pension benefit plan
which is covered by Title IV of ERISA or subject to the minimum funding
standards under Section 412 of the Code and is either (i) maintained by a member
of the Controlled Group for employees of any member of the Controlled Group or
(ii) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to which
a member of the Controlled Group is then making or accruing an obligation to
make contributions or has within the preceding 5 plan years made contributions.
"Prime Rate" refers to that interest rate so denominated and
set by Wachovia from time to time as an interest rate basis for borrowings. The
Prime Rate is but one of several interest rate bases used by Wachovia. Wachovia
lends at interest rates above and below the Prime Rate.
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"Properties" means all real property owned, leased or
otherwise used or occupied by the Borrower or any Subsidiary, wherever located.
"Rate Determination Date" has the meaning set forth in Section
2.05(a).
"Redeemable Preferred Stock" of any Person means any preferred
stock issued by such Person which is at any time prior to the Termination Date
either (i) mandatorily redeemable (by sinking fund or similar payments or
otherwise) or (ii) redeemable at the option of the holder thereof.
"Required Banks" means at any time Banks having at least 66
2/3% of the aggregate amount of the Commitments or, if the Commitments are no
longer in effect, Banks holding at least 66 2/3% of the aggregate outstanding
principal amount of the Notes.
"Stockholders' Equity" means, at any time, the shareholders'
equity of the Borrower and its Consolidated Subsidiaries, as set forth or
reflected on the most recent consolidated balance sheet of the Borrower and its
Consolidated Subsidiaries prepared in accordance with GAAP, but excluding any
Redeemable Preferred Stock of the Borrower or any of its Consolidated
Subsidiaries. Shareholders' equity generally would include, but not be limited
to (i) the par or stated value of all outstanding Capital Stock, (ii) capital
surplus, (iii) retained earnings, and (iv) various deductions such as (A)
purchases of treasury stock, (B) valuation allowances, (C) receivables due from
an employee stock ownership plan, (D) employee stock ownership plan debt
guarantees, and (E) translation adjustments for foreign currency transactions.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other persons performing similar functions
are at the time directly or indirectly owned by the Borrower.
"Taxes" has the meaning set forth in Section 2.11(c).
"Termination Date" means February 27, 2002.
"Third Parties" means all lessees, sublessees, licensees and
other users of the Properties, excluding those users of the Properties in the
ordinary course of the Borrower's business and on a temporary basis.
"Total Capitalization" means, at any time, the sum of (i)
Consolidated Net Worth, and (ii) Consolidated Total Debt, provided, that for
purposes of this definition only, in determining Consolidated Total Debt,
clauses (vii), (viii) and (ix) of the definition of Debt contained in this
Agreement shall be disregarded.
"Total Unused Commitments" means at any date, an amount equal
to: (i) the aggregate amount of the Commitments of all of the Banks at such
time, less (ii) the aggregate outstanding principal amount of the Loans of all
of the Banks at such time.
"Transferee" has the meaning set forth in Section 9.07(d).
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"Unused Commitment" means at any date, with respect to any
Bank, an amount equal to its Commitment less the aggregate outstanding principal
amount of its Loans.
"Unused Fee Determination Date" has the meaning set forth in
Section 2.06(a).
"Unused Fee Payment Date" means each March 31, June 30,
September 30 and December 31.
"Wachovia" means Wachovia Bank of Georgia, N.A., a national
banking association and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the
shares of capital stock or other ownership interests of which (except directors'
qualifying shares) are at the time directly or indirectly owned by the Borrower.
SECTION 1.02. Accounting Terms and Determinations. Unless
otherwise specified herein, all terms of an accounting character used herein
shall be interpreted, all accounting determinations hereunder shall be made, and
all financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP, applied on a basis consistent (except for changes
concurred in by the Borrower's independent public accountants or otherwise
required by a change in GAAP) with the most recent audited consolidated
financial statements of the Borrower and its Consolidated Subsidiaries delivered
to the Banks, unless with respect to any such change concurred in by the
Borrower's independent public accountants or required by GAAP, in determining
compliance with any of the provisions of this Agreement or any of the other Loan
Documents: (i) the Borrower shall have objected to determining such compliance
on such basis at the time of delivery of such financial statements, or (ii) the
Required Banks shall so object in writing within 30 days after the delivery of
such financial statements, in either of which events such calculations shall be
made on a basis consistent with those used in the preparation of the latest
financial statements as to which such objection shall not have been made (which,
if objection is made in respect of the first financial statements delivered
under Section 5.01 hereof, shall mean the financial statements referred to in
Section 4.04).
SECTION 1.03. Use of Defined Terms. All terms defined in this
Agreement shall have the same meanings when used in any of the other Loan
Documents, unless otherwise defined therein or unless the context shall
otherwise require.
SECTION 1.04. Terminology. All personal pronouns used in this
Agreement, whether used in the masculine, feminine or neuter gender, shall
include all other genders; the singular shall include the plural and the plural
shall include the singular. Titles of Articles and Sections in this Agreement
are for convenience only, and neither limit nor amplify the provisions of this
Agreement.
SECTION 1.05. References. Unless otherwise indicated,
references in this Agreement to "Articles", "Exhibits", "Schedules", and
"Sections" are references to articles, exhibits, schedules and sections hereof.
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ARTICLE II
THE CREDITS
SECTION 2.01. Commitments to Make Loans. Each Bank severally
agrees, on the terms and conditions set forth herein, to make Loans to the
Borrower from time to time before the Termination Date; provided that,
immediately after each such Loan is made, the aggregate outstanding principal
amount of Loans by such Bank shall not exceed the amount of its Commitment,
provided further that the aggregate principal amount of all Loans at any one
time outstanding shall not exceed the aggregate amount of the Commitments of all
of the Banks at such time. Each Euro-Dollar Borrowing under this Section shall
be in an aggregate principal amount of $5,000,000 or any larger multiple of
$1,000,000 and each Base Rate Borrowing under this Section shall be in an
aggregate principal amount of $1,000,000 or any larger multiple of $1,000,000
(except that any such Borrowing may be in the aggregate amount of the Unused
Commitments) and each Borrowing under this Section shall be made from the
several Banks ratably in proportion to their respective Commitments. Within the
foregoing limits, the Borrower may borrow under this Section, repay or, to the
extent permitted by Section 2.09, prepay Loans and reborrow under this Section
at any time before the Termination Date.
SECTION 2.02. Method of Borrowing Loans. (a) The Borrower
shall give the Agent Notice in the form attached hereto as Exhibit H (a "Notice
of Borrowing") prior to 11:00 A.M. (Atlanta, Georgia time) on the Domestic
Business Day of each Base Rate Borrowing and at least 3 Euro-Dollar Business
Days before each Euro-Dollar Borrowing, specifying:
(i) the date of such Borrowing, which shall be a
Domestic Business Day in the case of a Base Rate Borrowing or
a Euro-Dollar Business Day in the case of a Euro-Dollar
Borrowing,
(ii) the aggregate amount of such Borrowing,
(iii) whether the Loans comprising such Borrowing are
to be Base Rate Loans or Euro-Dollar Loans,
(iv) in the case of a Euro-Dollar Borrowing, the
duration of the Interest Period applicable thereto, subject to
the provisions of the definition of Interest Period; and
(v) the Indicative Rate, if the Borrower has been
advised by the Agent on the date the Borrower provides the
Agent with a Notice of Borrowing of the Base Rate or the
Adjusted London Interbank Offered Rate for the applicable
Interest Period, effective on the date of such Notice of
Borrowing.
(b) Upon receipt of a Notice of Borrowing, the Agent shall
promptly notify each Bank of the contents thereof and of such Bank's ratable
share of such Borrowing and such Notice of Borrowing shall not thereafter be
revocable by the Borrower.
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(c) Not later than 12:00 P.M. (Atlanta, Georgia time) on the
date of each Borrowing, each Bank shall (except as provided in subsection (d) of
this Section) make available its ratable share of such Borrowing, in federal or
other funds immediately available in Atlanta, Georgia, to the Agent at its
address referred to in or specified pursuant to Section 9.01. Unless the Agent
determines that any applicable condition specified in Article III has not been
satisfied, the Agent will make the funds so received from the Banks available to
the Borrower at the Agent's aforesaid address. Unless the Agent receives Notice
from a Bank, at the Agent's address referred to in Section 9.01, no later than
4:00 P.M. (local time at such address) on the Domestic Business Day before the
date of a Borrowing, stating that such Bank will not make a Loan in connection
with such Borrowing because a term or condition of this Agreement (including,
without limitation, any condition or term specified on Article III or VIII
hereof) has not been satisfied or such Bank is not otherwise obligated to make
such Loan under the terms of this Agreement (whether pursuant to Article III
hereof, Article VIII hereof or otherwise), the Agent shall be entitled to assume
that such Bank will make a Loan in connection with such Borrowing and, in
reliance on such assumption, the Agent may (but shall not be obligated to) make
available such Bank's ratable share of such Borrowing to the Borrower for the
account of such Bank. If the Agent makes such Bank's ratable share available to
the Borrower and such Bank does not in fact make its ratable share of such
Borrowing available on such date, the Agent shall be entitled to recover such
Bank's ratable share from such Bank or the Borrower (and for such purpose shall
be entitled to charge such amount to any account of the Borrower maintained with
the Agent), together with interest thereon for each day during the period from
the date of such Borrowing until such sum shall be paid in full at a rate per
annum equal to the rate at which the Agent determines that it obtained (or could
have obtained) overnight federal funds to cover such amount for each such day
during such period, provided that any such payment by the Borrower of such
Bank's ratable share and interest thereon shall be without prejudice to any
rights that the Borrower may have against such Bank. If such Bank shall repay to
the Agent such corresponding amount, such amount so repaid shall constitute such
Bank's Loan included in such Borrowing for purposes of this Agreement.
(d) If any Bank makes a new Loan hereunder on a day on which
the Borrower is to repay all or any part of an outstanding Loan from such Bank,
such Bank shall apply the proceeds of its new Loan to make such repayment and
only an amount equal to the difference (if any) between the amount being
borrowed and the amount being repaid shall be made available by such Bank to the
Agent as provided in subsection (c) of this Section, or remitted by the Borrower
to the Agent as provided in Section 2.11, as the case may be.
(e) Notwithstanding anything to the contrary contained in this
Agreement, no Euro-Dollar Borrowing may be made if there shall have occurred a
Default or an Event of Default, which Default or Event of Default shall not have
been cured or waived in writing.
(f) In the event that a Notice of Borrowing fails to specify
whether the Loans comprising such Borrowing are to be Base Rate Loans or
Euro-Dollar Loans, such Loans shall be made as Base Rate Loans. If the Borrower
is otherwise entitled under this Agreement to repay any Loans maturing at the
end of an Interest Period applicable thereto with the proceeds of a new
Borrowing, and the Borrower fails to repay such Loans using its own moneys and
fails to give a Notice of Borrowing in connection with such new Borrowing, a new
Borrowing shall be deemed to be made
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on the date such Loans mature in an amount equal to the principal amount of the
Loans so maturing, and the Loans comprising such new Borrowing shall be Base
Rate Loans.
(g) Notwithstanding anything to the contrary contained herein,
(i) there shall not be more than nine (9) different Interest Periods outstanding
at the same time (for which purpose Interest Periods described in different
numbered clauses of the definition of the term "Interest Period" shall be deemed
to be different Interest Periods even if they are coterminous) and (ii) the
proceeds of any Base Rate Borrowing shall be applied first to repay the unpaid
principal amount of all Base Rate Loans (if any) outstanding immediately before
such Base Rate Borrowing.
SECTION 2.03. Notes. (a) The Loans of each Bank shall be
evidenced by a single Note payable to the order of such Bank for the account of
its Lending Office in an amount equal to the original principal amount of such
Bank's Commitment.
(b) Upon receipt of each Bank's Notes pursuant to Section
3.01, the Agent shall deliver such Notes to such Bank. Each Bank shall record,
and prior to any transfer of its Notes shall endorse on the schedule forming a
part thereof appropriate notations to evidence the date, amount and maturity of,
and effective interest rate for, each Loan made by it, the date and amount of
each payment of principal made by the Borrower with respect thereto and whether,
in the case of such Bank's Note, such Loan is a Base Rate Loan or Euro-Dollar
Loan, and such schedule shall constitute rebuttable presumptive evidence of the
principal amount owing and unpaid on such Bank's Notes; provided that the
failure of any Bank to make, or any error in making, any such recordation or
endorsement shall not affect the obligation of the Borrower hereunder or under
the Notes or the ability of any Bank to assign its Notes. Each Bank is hereby
irrevocably authorized by the Borrower so to endorse its Notes and to attach to
and make a part of any Note a continuation of any such schedule as and when
required.
SECTION 2.04. Maturity of Loans. Each Loan included in any
Borrowing shall mature, and the principal amount thereof shall be due and
payable, on the last day of the Interest Period applicable to such Borrowing.
SECTION 2.05. Interest Rates. (a) "Applicable Margin" shall be
determined quarterly based upon the ratio of Consolidated Total Debt to Total
Capitalization (calculated as of the last day of each Fiscal Quarter), as
follows:
Ratio of Consolidated Total
Debt to Total Capitalization Base Rate Loans Euro-Dollar Loans
--------------- -----------------
Greater than .45 0% .50%
Greater than .35
and equal to or less than .45 0% .40%
Greater than .25
and equal to or less than .35 0% .30%
Less than or equal to .25 0% .25%
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The Applicable Margin shall be determined effective as of the date (herein, the
"Rate Determination Date") which is 55 days after the last day of the Fiscal
Quarter as of the end of which the foregoing ratio is being determined, based on
the quarterly financial statements for such Fiscal Quarter, and the Applicable
Margin so determined shall remain effective from such Rate Determination Date
until the date which is 55 days after the last day of the Fiscal Quarter in
which such Rate Determination Date falls (which latter date shall be a new Rate
Determination Date); provided that (i) for the period from and including the
Closing Date to but excluding the Rate Determination Date next following the
Closing Date, the Applicable Margin shall be (A) 0% for Base Rate Loans and (B)
.25% for Euro-Dollar Loans, (ii) in the case of any Applicable Margin determined
for the fourth and final Fiscal Quarter of a Fiscal Year, the Rate Determination
Date shall be the date which is 110 days after the last day of such final Fiscal
Quarter and such Applicable Margin shall be determined based upon the annual
audited financial statements for the Fiscal Year ended on the last day of such
final Fiscal Quarter, and (iii) if on any Rate Determination Date the Borrower
shall have failed to deliver to the Banks the financial statements required to
be delivered pursuant to Section 5.01(a) or Section 5.01(b) with respect to the
Fiscal Year or Fiscal Quarter, as the case may be, most recently ended prior to
such Rate Determination Date, then for the period beginning on such Rate
Determination Date and ending on the earlier of (A) the date on which the
Borrower shall deliver to the Banks the financial statements to be delivered
pursuant to Section 5.01(b) with respect to such Fiscal Quarter or any
subsequent Fiscal Quarter, or (B) the date on which the Borrower shall deliver
to the Banks annual financial statements required to be delivered pursuant to
Section 5.01(a) with respect to the Fiscal Year which includes such Fiscal
Quarter or any subsequent Fiscal Year, the Applicable Margin shall be determined
as if the ratio of Consolidated Total Debt to Total Capitalization was more than
.45 at all times during such period. Any change in the Applicable Margin on any
Rate Determination Date shall result in a corresponding change, effective on and
as of such Rate Determination Date, in the interest rate applicable to each Loan
outstanding on such Rate Determination Date, provided that: (i) for Euro-Dollar
Loans, changes in Applicable Margin shall only be effective for Interest Periods
commencing on or after the Rate Determination Date; and (ii) no Applicable
Margin shall be decreased pursuant to this Section 2.05 if a Default is in
existence on the Rate Determination Date.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made until it
becomes due, at a rate per annum equal to the Base Rate for such day plus the
Applicable Margin. Such interest shall be payable for each Interest Period on
the last day thereof. Any overdue principal of and, to the extent permitted by
applicable law, overdue interest on any Base Rate Loan shall bear interest,
payable on demand, for each day until paid at a rate per annum equal to the
Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin plus the
applicable Adjusted London Interbank Offered Rate for such Interest Period;
provided that if any Euro-Dollar Loan shall, as a result of clause (1)(c) of the
definition of Interest Period, have an Interest Period of less than one month,
such Euro-Dollar Loan shall bear interest during such Interest Period at the
rate applicable to Base Rate Loans during such period. Such interest shall be
payable for each Interest Period on the last day thereof and, if such Interest
Period is longer than 3 months, at intervals of 3 months after the first day
thereof. Any overdue principal of
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and, to the extent permitted by applicable law, overdue interest on any
Euro-Dollar Loan shall bear interest, payable on demand, for each day until paid
at a rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained (rounded
upward, if necessary, to the next higher 1/100th of 1%) by dividing (i) the
applicable London Interbank Offered Rate for such Interest Period by (ii) 1.00
minus the Euro-Dollar Reserve Percentage.
The "London Interbank Offered Rate" applicable to any
Euro-Dollar Loan means for the Interest Period of such Euro-Dollar Loan, the
rate per annum determined on the basis of the rate for deposits in Dollars of
amounts equal or comparable to the principal amount of such Euro-Dollar Loan
offered for a term comparable to such Interest Period, which rate appears on the
display designated as Page "3750" of the Telerate Service (or such other page as
may replace Page 3750 of that service or such other service or services as may
be nominated by the British Banker's Association for the purpose of displaying
London Interbank Offered Rates for U.S. dollar deposits) determined as of 1:00
p.m. New York City time, 2 Euro-Dollar Business Days prior to the first day of
such Interest Period.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member bank of
the Federal Reserve System in respect of "Eurocurrency liabilities" (or in
respect of any other category of liabilities which includes deposits by
reference to which the interest rate on Euro-Dollar Loans is determined or any
category of extensions of credit or other assets which includes loans by a
non-United States office of any Bank to United States residents). The Adjusted
London Interbank Offered Rate shall be adjusted automatically on and as of the
effective date of any change in the Euro-Dollar Reserve Percentage.
(d) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt Notice to the Borrower and the
Banks by telecopy of each rate of interest so determined, and its determination
thereof shall be conclusive in the absence of manifest error.
(e) After the occurrence and during the continuance of a
Default, the principal amount of the Loans (and, to the extent permitted by
applicable law, all accrued interest thereon) may, at the election of the
Required Banks, bear interest at the Default Rate; provided, however, that
automatically, whether or not the Required Banks elect to do so, any overdue
principal of and, to the extent permitted by law, overdue interest on any Loan
shall bear interest payable on demand, for each day until paid at a rate per
annum equal to the Default Rate.
SECTION 2.06. Fees. (a) The Borrower shall pay to the Agent
for the ratable account of each Bank an unused fee equal to the product of: (i)
the aggregate of the daily average amounts of such Bank's Unused Commitment,
times (ii) a per annum percentage equal to the Applicable Unused Fee Rate. Such
unused fee shall accrue from and including the Closing Date to and including the
Termination Date. Unused fees shall be payable quarterly in arrears on the first
Unused Fee Payment Date following each Unused Fee Determination Date and on the
Termination Date; provided that
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should the Commitments be terminated at any time prior to the Termination Date
for any reason, the entire accrued and unpaid unused fee shall be paid on the
date of such termination. The "Applicable Unused Fee Rate" shall be determined
quarterly based upon the ratio of Consolidated Total Debt to Total
Capitalization (calculated as of the last day of each Fiscal Quarter) as
follows:
Ratio of Consolidated Total Debt to Applicable
Total Capitalization Unused Fee Rate
------------------------------------ ----------------
Greater than .45 .20%
Greater than .35
and equal to or less than .45 .150%
Greater than .25
and equal to or less than .35 .1250%
Less than or equal to .25 .10%
The Applicable Unused Fee Rate shall be determined effective as of the date
(herein, the "Unused Fee Determination Date") which is 55 days after the last
day of the Fiscal Quarter as of the end of which the foregoing ratio is being
determined, based on the quarterly financial statements for such Fiscal Quarter,
and the Applicable Unused Fee Rate so determined shall remain effective from
such Unused Fee Determination Date until the date which is 55 days after the
last day of the Fiscal Quarter in which such Unused Fee Determination Date falls
(which latter date shall be a new Unused Fee Determination Date); provided that
(i) for the period from and including the Closing Date to but excluding the
Unused Fee Determination Date next following the Closing Date, the Applicable
Unused Fee Rate shall be .10%; (ii) in the case of any Applicable Unused Fee
Rate determined for the fourth and final Fiscal Quarter of a Fiscal Year, the
Unused Fee Determination Date shall be the date which is 110 days after the last
day of such final Fiscal Quarter and such Applicable Unused Fee Rate shall be
determined based upon the annual audited financial statements for the Fiscal
Year ended on the last day of such final Fiscal Quarter, and (iii) if on any
Unused Fee Determination Date the Borrower shall have failed to deliver to the
Banks the financial statements required to be delivered pursuant to Section
5.01(a) or Section 5.01(b) with respect to the Fiscal Year or Fiscal Quarter, as
the case may be, most recently ended prior to such Unused Fee Determination
Date, then for the period beginning on such Unused Fee Determination Date and
ending on the earlier of (A) the date on which the Borrower shall deliver to the
Banks the financial statements to be delivered pursuant to Section 5.01(b) with
respect to such Fiscal Quarter or any subsequent Fiscal Quarter, and (B) the
date on which the Borrower shall deliver to the Banks annual financial
statements required to be delivered pursuant to Section 5.01(a) with respect to
the Fiscal Year which includes such Fiscal Quarter or any subsequent Fiscal
Year, the Applicable Unused Fee Rate shall be determined as if the ratio of
Consolidated Total Debt to Total Capitalization was more than .45 at all times
during such period.
(b) The Borrower shall pay to the Agent, for the account and
sole benefit of the Agent, such fees and other amounts at such times as set
forth in the Agent's Letter Agreement.
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SECTION 2.07. Optional Termination or Reduction of
Commitments. The Borrower may, upon at least 3 Domestic Business Days' Notice to
the Agent, terminate at any time, or proportionately reduce from time to time by
an aggregate amount of at least $5,000,000 or any larger multiple of $1,000,000,
the Commitments; provided, however, no such termination or reduction shall be in
an amount greater than the Total Unused Commitments on the date of such
termination or reduction. If the Commitments are terminated in their entirety,
all accrued fees (as provided under Section 2.06) shall be payable on the
effective date of such termination.
SECTION 2.08. Mandatory Reduction and Termination of
Commitments. The Commitments shall terminate on the Termination Date and any
Loans then outstanding (together with accrued interest thereon) shall be due and
payable on such date.
SECTION 2.09. Optional Prepayments. (a) The Borrower may, upon
Notice provided by the Borrower to the Agent prior to 11:00 A.M. (Atlanta,
Georgia time) on the Domestic Business Day of the prepayment of a Base Rate
Borrowing, prepay any Base Rate Borrowing in whole at any time, or from time to
time in part in amounts aggregating at least $1,000,000 or any larger multiple
of $1,000,000, by paying the principal amount to be prepaid together with
accrued interest thereon to the date of prepayment. Each such optional
prepayment shall be applied to prepay ratably the Base Rate Loans of the several
Banks included in such Base Rate Borrowing.
(b) The Borrower may, upon Notice provided by the Borrower to
the Agent prior to 11:00 A.M. (Atlanta, Georgia time) on the Euro-Dollar
Business Day of the prepayment of a Euro-Dollar Borrowing, prepay any
Euro-Dollar Borrowing in whole at any time, or from time to time in part in
amounts aggregating at least $5,000,000 or any larger multiple of $1,000,000, by
paying the principal amount to be prepaid together with accrued interest thereon
to the date of prepayment and any and all amounts as provided under Section 8.05
in connection with such prepayment. Each such optional prepayment shall be
applied to prepay ratably the Euro-Dollar Loans of the several Banks included in
such Euro-Dollar Borrowing.
(c) Upon receipt of a notice of prepayment pursuant to this
Section, the Agent shall promptly notify each Bank of the contents thereof and
of such Bank's ratable share of such prepayment and such notice shall not
thereafter be revocable by the Borrower.
SECTION 2.10. Mandatory Prepayments. On each date on which the
Commitments are reduced pursuant to Section 2.07 or Section 2.08, the Borrower
shall repay or prepay such principal amount of the outstanding Loans, if any
(together with interest accrued thereon and any amounts due under Section
8.05(a)), as may be necessary so that after such payment the aggregate unpaid
principal amount of the Loans does not exceed the aggregate amount of the
Commitments as then reduced. Each such payment or prepayment shall be applied to
repay or prepay ratably the Loans of the several Banks.
SECTION 2.11. General Provisions as to Payments. (a) The
Borrower shall make each payment of principal of, and interest on, the Loans and
of unused fees hereunder, not later than 11:00 A.M. (Atlanta, Georgia time) on
the date when due, in Federal or other funds immediately
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available in Atlanta, Georgia, to the Agent at its address referred to in
Section 9.01. The Agent will promptly distribute to each Bank its ratable share
of each such payment received by the Agent for the account of the Banks.
(b) Whenever any payment of principal of, or interest on, the
Base Rate Loans or of fees shall be due on a day which is not a Domestic
Business Day, the date for payment thereof shall be extended to the next
succeeding Domestic Business Day. Whenever any payment of principal of, or
interest on, the Euro-Dollar Loans shall be due on a day which is not a
Euro-Dollar Business Day, the date for payment thereof shall be extended to the
next succeeding Euro-Dollar Business Day unless such Euro-Dollar Business Day
falls in another calendar month, in which case the date for payment thereof
shall be the next preceding Euro-Dollar Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
(c) All payments of principal, interest and fees and all other
amounts to be made by the Borrower pursuant to this Agreement with respect to
any Loan or fee relating thereto shall be paid without deduction for, and free
from, any tax, imposts, levies, duties, deductions, or withholdings of any
nature now or at anytime hereafter imposed by any governmental authority or by
any taxing authority thereof or therein excluding in the case of each Bank,
taxes imposed on or measured by its net income, and franchise taxes imposed on
it, by the jurisdiction under the laws of which such Bank is organized or any
political subdivision thereof and, in the case of each Bank, taxes imposed on
its income, and franchise taxes imposed on it, by the jurisdiction of such
Bank's applicable Lending Office or any political subdivision thereof (all such
non-excluded taxes, imposts, levies, duties, deductions or withholdings of any
nature being "Taxes"). In the event that the Borrower is required by applicable
law to make any such withholding or deduction of Taxes with respect to any Loan
or fee or other amount, the Borrower shall pay such deduction or withholding to
the applicable taxing authority, shall promptly furnish to any Bank in respect
of which such deduction or withholding is made all receipts and other documents
evidencing such payment and shall pay to such Bank additional amounts as may be
necessary in order that the amount received by such Bank after the required
withholding or other payment shall equal the amount such Bank would have
received had no such withholding or other payment been made. If no withholding
or deduction of Taxes are payable in respect of any Loan or fee relating
thereto, the Borrower shall furnish any Bank, at such Bank's request, a
certificate from each applicable taxing authority or an opinion of counsel
acceptable to such Bank, in either case stating that such payments are exempt
from or not subject to withholding or deduction of Taxes. If the Borrower fails
to provide such original or certified copy of a receipt evidencing payment of
Taxes or certificate(s) or opinion of counsel of exemption, the Borrower hereby
agrees to compensate such Bank for, and indemnify them with respect to, the tax
consequences of the Borrower's failure to provide evidence of tax payments or
tax exemption.
In the event any Bank receives a refund of any Taxes paid by
the Borrower pursuant to this Section 2.11, it will pay to the Borrower the
amount of such refund promptly upon receipt thereof; provided, however, if at
any time thereafter it is required to return such refund, the Borrower shall
promptly repay to it the amount of such refund.
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Without prejudice to the survival of any other agreement of
the Borrower hereunder, the agreements and obligations of the Borrower contained
in this Section 2.11 shall be applicable with respect to any Participant,
Assignee or other Transferee, and any calculations required by such provisions
(i) shall be made based upon the circumstances of such Participant, Assignee or
other Transferee, and (ii) constitute a continuing agreement and shall survive
the termination of this Agreement and the payment in full or cancellation of the
Notes.
SECTION 2.12. Computation of Interest and Fees. Interest on
Base Rate Loans shall be computed on the basis of a year of 360 days and paid
for the actual number of days elapsed (including the first day but excluding the
last day). Interest on Euro-Dollar Loans shall be computed on the basis of a
year of 360 days and paid for the actual number of days elapsed, calculated as
to each Interest Period from and including the first day thereof to but
excluding the last day thereof. Unused fees and any other fees payable hereunder
shall be computed on the basis of a year of 360 days and paid for the actual
number of days elapsed (including the first day but excluding the last day).
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. Conditions to First Borrowing. The obligation of
each Bank to make a Loan on the occasion of the first Borrowing is subject to
the satisfaction of the conditions set forth in Section 3.02 and the following
additional conditions:
(a) receipt by the Agent from each of the parties hereto of
either (i) a duly executed counterpart of this Agreement signed by such party or
(ii) a facsimile transmission stating that such party has duly executed a
counterpart of this Agreement and sent such counterpart to the Agent;
(b) receipt by the Agent of a duly executed Note for the
account of each Bank complying with the provisions of Section 2.03;
(c) receipt by the Agent of opinions (together with any
opinions of local counsel relied on therein) of Xxxxx, Xxxxxx & Irish, P.C. and
Xxxxxxxx Ingersoll, P.C., counsel for the Borrower, dated as of the Closing
Date, substantially in the forms of Exhibit B-1 and Exhibit B-2 hereto and
covering such additional matters relating to the transactions contemplated
hereby as the Agent or any Bank may reasonably request;
(d) receipt by the Agent of an opinion of Womble, Carlyle,
Xxxxxxxxx & Xxxx, PLLC, special counsel for the Agent, dated as of the Closing
Date, substantially in the form of Exhibit C hereto and covering such additional
matters relating to the transactions contemplated hereby as the Agent may
reasonably request;
(e) receipt by the Agent of a certificate (the "Closing
Certificate"), dated as of the Closing Date, substantially in the form of
Exhibit D hereto, signed by the Chairman of the Borrower, to the effect that (i)
no Default has occurred and is continuing on the date of the first Borrowing and
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(ii) the representations and warranties of the Borrower contained in Article IV
are true on and as of the date of the first Borrowing hereunder;
(f) receipt by the Agent of all documents which the Agent or
any Bank may reasonably request relating to the existence of the Borrower, the
corporate authority for and the validity of this Agreement and the Notes, and
any other matters relevant hereto, all in form and substance satisfactory to the
Agent, including without limitation a certificate of incumbency of the Borrower
(the "Officer's Certificate"), signed by the Secretary or an Assistant Secretary
of the Borrower, substantially in the form of Exhibit E hereto, certifying as to
the names, true signatures and incumbency of the officer or officers of the
Borrower authorized to execute and deliver the Loan Documents, and certified
copies of the following items: (i) the Borrower's Certificate of Incorporation,
(ii) the Borrower's Bylaws, (iii) a certificate of the Secretary of State of the
State of Delaware as to the good standing of the Borrower as a Delaware
corporation, and (iv) the action taken by the Board of Directors of the Borrower
authorizing the Borrower's execution, delivery and performance of this
Agreement, the Notes and the other Loan Documents to which the Borrower is a
party; and
(g) receipt by the Agent of a Notice of Borrowing.
SECTION 3.02. Conditions to All Borrowings. The obligation of
each Bank to make a Loan on the occasion of each Borrowing is subject to the
satisfaction of the following conditions:
(a) receipt by the Agent of Notice of Borrowing as required by
Section 2.02;
(b) the fact that, immediately before and after such
Borrowing, no Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the
Borrower contained in Article IV of this Agreement shall be true on and as of
the date of such Borrowing; and
(d) the fact that, immediately after such Borrowing (i) the
aggregate outstanding principal amount of the Loans of each Bank will not exceed
the amount of its Commitment and (ii) the aggregate outstanding principal amount
of the Loans will not exceed the aggregate amount of the Commitments of all of
the Banks as of such date.
Each Borrowing hereunder shall be deemed to be a representation and warranty by
the Borrower on the date of such Borrowing as to the truth and accuracy of the
facts specified in clauses (b), (c) and (d) of this Section.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants that:
SECTION 4.01. Corporate Existence and Power. The Borrower is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation, is duly qualified to transact business
in every jurisdiction where, by the nature of its business, such qualification
is necessary, and has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as now
conducted.
SECTION 4.02. Corporate and Governmental Authorization; No
Contravention. The execution, delivery and performance by the Borrower of this
Agreement, the Notes and the other Loan Documents (i) are within the Borrower's
corporate powers, (ii) have been duly authorized by all necessary corporate
action, (iii) require no action by or in respect of, or filing with, any
governmental body, agency or official, (iv) do not contravene, or constitute a
default under, any provision of applicable law or regulation or of the
certificate of incorporation or by-laws of the Borrower or of any agreement,
judgment, injunction, order, decree or other instrument binding upon the
Borrower or any of its Subsidiaries, and (v) do not result in the creation or
imposition of any Lien on any asset of the Borrower or any of its Subsidiaries.
SECTION 4.03. Binding Effect. This Agreement constitutes a
valid and binding agreement of the Borrower enforceable in accordance with its
terms, and the Notes and the other Loan Documents, when executed and delivered
in accordance with this Agreement, will constitute valid and binding obligations
of the Borrower enforceable in accordance with their respective terms, provided
that the enforceability hereof and thereof is subject in each case to general
principles of equity and to bankruptcy, insolvency and similar laws affecting
the enforcement of creditors' rights generally.
SECTION 4.04. Financial Information. (a) The consolidated
balance sheet of the Borrower and its Consolidated Subsidiaries as of December
31, 1995 and the related consolidated statements of income, shareholders' equity
and cash flows for the Fiscal Year then ended, reported on by Xxxxxx Xxxxxxxx
LLP, copies of which have been delivered to each of the Banks, and the unaudited
consolidated financial statements of the Borrower for the interim period ended
September 28, 1996, copies of which have been delivered to each of the Banks,
fairly present, in conformity with GAAP, the consolidated financial position of
the Borrower and its Consolidated Subsidiaries as of such dates and their
consolidated results of operations and cash flows for such periods stated.
(b) Since December 31, 1995 there has been no event, act,
condition or occurrence having a Material Adverse Effect.
SECTION 4.05. Litigation. (a) There is no action, suit or
proceeding pending, or to the knowledge of the Borrower threatened, against or
affecting the Borrower or any of its Subsidiaries before any court or arbitrator
or any governmental body, agency or official which could have a
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Material Adverse Effect or which in any manner draws into question the validity
or enforceability of, or could impair the ability of the Borrower to perform its
obligations under, this Agreement, the Notes or any of the other Loan Documents.
(b) Schedule 4.05 sets forth: (1) a true, accurate and
complete in every material respect description of the claims, defenses and
status of the Fraudulent Transfer Litigation and Products Liability Matters; and
(2) a true, accurate and complete description of the Borrower's assessment and
analysis of the merits of the claims and defenses in the Fraudulent Transfer
Litigation and Products Liability Matters, the likely outcome of the Fraudulent
Transfer Litigation and Products Liability Matters and the probable liability of
the Borrower, if any, in connection with the Fraudulent Transfer Litigation and
Products Liability Matters.
SECTION 4.06. Compliance with ERISA. (a) The Borrower and each
member of the Controlled Group have fulfilled their obligations under the
minimum funding standards of ERISA and the Code with respect to each Plan and
are in compliance in all material respects with the presently applicable
provisions of ERISA and the Code, and have not incurred any liability to the
PBGC or a Plan under Title IV of ERISA.
(b) Neither the Borrower nor any member of the Controlled
Group is or ever has been obligated to contribute to any Multiemployer Plan.
SECTION 4.07. Taxes. There have been filed on behalf of the
Borrower and its Subsidiaries all Federal, state and local income, excise,
property and other tax returns which are required to be filed by them and all
taxes due pursuant to such returns or pursuant to any assessment received by or
on behalf of the Borrower or any Subsidiary have been paid. The charges,
accruals and reserves on the books of the Borrower and its Subsidiaries in
respect of taxes or other governmental charges are, in the opinion of the
Borrower, adequate. United States income tax returns of the Borrower and its
Subsidiaries have been examined and closed through the Fiscal Year ended
December 31, 1990.
SECTION 4.08. Subsidiaries. Each of the Borrower's
Subsidiaries is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, is duly qualified
to transact business in every jurisdiction where, by the nature of its business,
such qualification is necessary, and has all corporate powers and all
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted. The Borrower has no Subsidiaries except those
Subsidiaries listed on Schedule 4.08, which accurately sets forth each such
Subsidiary's complete name and jurisdiction of incorporation.
SECTION 4.09. Not an Investment Company. Neither the Borrower
nor any of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
SECTION 4.10 Public Utility Holding Company Act. Neither the
Borrower nor any of its Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an
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"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", as such terms are defined in the Public Utility Holding Company Act of
1935, as amended.
SECTION 4.11. Ownership of Property; Liens. Each of the
Borrower and its Consolidated Subsidiaries has title to its properties
sufficient for the conduct of its business, and none of such property is subject
to any Lien except as permitted in Section 5.07.
SECTION 4.12. No Default. Neither the Borrower nor any of
its Consolidated Subsidiaries is in default under or with respect to any
agreement, instrument or undertaking to which it is a party or by which it or
any of its property is bound which could have or cause a Material Adverse
Effect. No Default or Event of Default has occurred and is continuing.
SECTION 4.13. Full Disclosure. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is, and
all such information hereafter furnished by the Borrower to the Agent or any
Bank will be, true, accurate and complete in every material respect or based on
reasonable estimates on the date as of which such information is stated or
certified. The Borrower has disclosed to the Banks in writing any and all facts
which could have or cause a Material Adverse Effect.
SECTION 4.14. Environmental Matters. (a) Neither the Borrower
nor any Subsidiary is subject to any Environmental Liability which could have or
cause a Material Adverse Effect and neither the Borrower nor any Subsidiary has
been designated as a potentially responsible party under CERCLA or under any
state statute similar to CERCLA. None of the Properties has been identified on
any current or proposed (i) National Priorities List under 40 C.F.R. ss. 300,
(ii) CERCLIS list or (iii) any list arising from a state statute similar to
CERCLA.
(b) No Hazardous Materials have been or are being used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed or otherwise handled at, or shipped or transported to or
from the Properties or are otherwise present at, on, in or under the Properties,
or, to the best of the knowledge of the Borrower, at or from any adjacent site
or facility, except for Hazardous Materials, such as cleaning solvents,
pesticides, foundry residuals, plating residuals, grinding residuals and other
materials used, produced, manufactured, processed, treated, recycled, generated,
stored, disposed of, and managed or otherwise handled in the ordinary course of
business in compliance with all applicable Environmental Requirements.
(c) The Borrower, and each of its Subsidiaries and Affiliates,
has procured all Environmental Authorizations necessary for the conduct of its
business, and is in compliance with all Environmental Requirements in connection
with the operation of the Properties and the Borrower's, and each of its
Subsidiarys' and Affiliates', respective businesses.
SECTION 4.15. Compliance with Laws. The Borrower and each
Subsidiary is in compliance with all applicable laws, including, without
limitation, all Environmental Laws, except
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where any failure to comply with any such laws would not, alone or in the
aggregate, have a Material Adverse Effect.
SECTION 4.16. Capital Stock. All Capital Stock, debentures,
bonds, notes and all other securities of the Borrower and its Subsidiaries
presently issued and outstanding are validly and properly issued in accordance
with all applicable laws, including, but not limited to, the "Blue Sky" laws of
all applicable states and the federal securities laws. The issued shares of
Capital Stock of the Borrower's Wholly Owned Subsidiaries are owned by the
Borrower free and clear of any Lien or adverse claim. At least a majority of the
issued shares of capital stock of each of the Borrower's other Subsidiaries
(other than Wholly Owned Subsidiaries) is owned by the Borrower free and clear
of any Lien or adverse claim.
SECTION 4.17. Margin Stock. Neither the Borrower nor any of
its Subsidiaries is engaged principally, or as one of its important activities,
in the business of purchasing or carrying any Margin Stock, and no part of the
proceeds of any Loan will be used to purchase or carry any Margin Stock or to
extend credit to others for the purpose of purchasing or carrying any Margin
Stock, or be used for any purpose which violates, or which is inconsistent with,
the provisions of Regulation X.
SECTION 4.18. Insolvency. After giving effect to the execution
and delivery of the Loan Documents and the making of the Loans under this
Agreement, the Borrower will not be "insolvent," within the meaning of such term
as used in O.C.G.A. ss. 18-2-22 or as defined in ss. 101 of Title 11 of the
United States Code or Section 2 of the Uniform Fraudulent Transfer Act, or any
other applicable state law pertaining to fraudulent transfers, as each may be
amended from time to time, or be unable to pay its debts generally as such debts
become due, or have an unreasonably small capital to engage in any business or
transaction, whether current or contemplated.
ARTICLE V
COVENANTS
The Borrower agrees that, so long as any Bank has any
Commitment hereunder or any amount payable under any Note remains unpaid:
SECTION 5.01. Information. The Borrower will deliver to
each of the Banks:
(a) as soon as available and in any event within 100 days
after the end of each Fiscal Year, a consolidated balance sheet of the Borrower
and its Consolidated Subsidiaries as of the end of such Fiscal Year and the
related consolidated statements of income, shareholders' equity and cash flows
for such Fiscal Year, setting forth in each case in comparative form the figures
for the previous fiscal year, all certified by Xxxxxx Xxxxxxxx LLP or other
independent public accountants of nationally recognized standing, with such
certification to be free of exceptions and qualifications not acceptable to the
Required Banks;
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(b) as soon as available and in any event within 50 days after
the end of each of the first 3 Fiscal Quarters of each Fiscal Year, a
consolidated balance sheet of the Borrower and its Consolidated Subsidiaries as
of the end of such Fiscal Quarter and the related statement of income and
statement of cash flows for such Fiscal Quarter and for the portion of the
Fiscal Year ended at the end of such Fiscal Quarter, setting forth in each case
in comparative form the figures for the corresponding Fiscal Quarter and the
corresponding portion of the previous Fiscal Year, all certified (subject to
normal year-end adjustments) as to fairness of presentation, GAAP and
consistency by the chief financial officer or the chief accounting officer of
the Borrower;
(c) simultaneously with the delivery of each set of financial
statements referred to in clauses (a) and (b) above, a certificate,
substantially in the form of Exhibit F (a "Compliance Certificate"), of the
chief financial officer or the chief accounting officer of the Borrower (i)
setting forth in reasonable detail the calculations required to establish
whether the Borrower was in compliance with the requirements of Sections 5.03
through 5.05, inclusive, 5.07, 5.10 and 5.19 on the date of such financial
statements and (ii) stating whether any Default exists on the date of such
certificate and, if any Default then exists, setting forth the details thereof
and the action which the Borrower is taking or proposes to take with respect
thereto;
(d) simultaneously with the delivery of each set of annual
financial statements referred to in clause (a) above, a statement of the firm of
independent public accountants which reported on such statements to the effect
that nothing has come to their attention to cause them to believe that any
Default existed on the date of such financial statements;
(e) within 5 Domestic Business Days after the Borrower becomes
aware of the occurrence of any Default, a certificate of the chief financial
officer or the chief accounting officer of the Borrower setting forth the
details thereof and the action which the Borrower is taking or proposes to take
with respect thereto;
(f) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports and proxy
statements so mailed;
(g) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto, any registration
statements on Form S-8 or its equivalent and reports made on Forms 3, 4 or 5
under Section 16 of the Securities Exchange Act of 1934, as amended) and annual,
quarterly, current or monthly reports which the Borrower shall have filed with
the Securities and Exchange Commission;
(h) if and when the Borrower or any member of the Controlled
Group (i) gives or is required to give notice to the PBGC of any "reportable
event" (as defined in Section 4043 of ERISA) with respect to any Plan which
might constitute grounds for a termination of such Plan under Title IV of ERISA,
or knows that the plan administrator of any Plan has given or is required to
give notice of any such reportable event, a copy of the notice of such
reportable event given or required to be given to the PBGC; (ii) receives notice
of complete or partial withdrawal liability under Title IV
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of ERISA, a copy of such notice; or (iii) receives notice from the PBGC under
Title IV of ERISA of an intent to terminate or appoint a trustee to administer
any Plan, a copy of such notice;
(i) promptly upon the occurrence of any adverse determination,
any settlement offer or any material change or development in any action,
proceeding, claim or other matter included in the Fraudulent Transfer Litigation
and Products Liability Matters, a written report of the chief executive officer
or the chief financial officer setting forth in reasonable detail a description
of such determination, settlement offer, change or development;
(j) promptly after the Borrower knows of the commencement
thereof, notice of any litigation, dispute or proceeding involving a claim
against the Borrower and/or any Subsidiary for $500,000 or more in excess of
amounts covered in full by applicable insurance; and
(k) from time to time such additional information regarding
the Fraudulent Transfer Litigation and Products Liability Matters, and the
financial position or business of the Borrower and its Subsidiaries as the
Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. Inspection of Property, Books and Records. The
Borrower will (i) keep, and will cause each Subsidiary to keep, proper books of
record and account in which full, true and correct entries in conformity with
GAAP shall be made of all dealings and transactions in relation to its business
and activities; and (ii) permit, and will cause each Subsidiary to permit,
representatives of any Bank at such Bank's expense prior to the occurrence of an
Event of Default and at the Borrower's expense after the occurrence of an Event
of Default to visit and inspect any of their respective properties, to examine
any of their respective books and records and to discuss their respective
affairs, finances and accounts with their respective officers, employees and
independent public accountants; provided, however: (1) prior to the occurrence
of an Event of Default: (i) representatives of a Bank shall not be entitled to
make abstracts from such books and records; and (ii) representatives of a Bank
shall provide the Borrower with reasonable Notice prior to any such visit or
inspection by such Bank; and (2) any information made available by the Borrower
to a Bank which information is clearly indicated to be confidential information
shall be kept confidential in accordance with Section 9.08. The Borrower agrees
to cooperate and assist in such visits and inspections, in each case at such
reasonable times and as often as may reasonably be desired.
SECTION 5.03. Ratio of Consolidated Total Debt to Total
Capitalization. The ratio of Consolidated Total Debt to Total Capitalization
will at all times be less than 0.55 to 1.00.
SECTION 5.04. Interest Coverage. At the end of each Fiscal
Quarter, commencing with the Fiscal Quarter ending December 31, 1996, the
Interest Coverage Ratio shall at all times be greater than 2.50 to 1.00.
SECTION 5.05. Loans or Advances. Neither the Borrower nor any
of its Subsidiaries shall make loans or advances to any Person except: (i) loans
or advances to employees not exceeding One Million and No/100 Dollars
($1,000,000) in the aggregate outstanding made in the ordinary course of
business and consistently with practices existing on December 31, 1995; (ii)
deposits
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required by government agencies or public utilities; and (iii) loans or advances
to Wholly Owned Subsidiaries; provided that after giving effect to the making of
any loans, advances or deposits permitted by clause (i), (ii) or (iii) of this
Section, no Default shall have occurred and be continuing.
SECTION 5.06. Investments. Neither the Borrower nor any of its
Subsidiaries shall make Investments in any Person except as permitted by Section
5.05 and except Investments in (i) direct obligations of the United States
Government maturing within one year, (ii) certificates of deposit issued by a
commercial bank whose long-term certificates of deposit are rated at least AA or
the equivalent thereof by Standard & Poor's Corporation and Aa or the equivalent
thereof by Xxxxx'x Investors Service, Inc., (iii) commercial paper rated A-1 or
the equivalent thereof by Standard & Poor's Corporation or P-1 or the equivalent
thereof by Xxxxx'x Investors Service, Inc. and in either case maturing within 6
months after the date of such Investment, (iv) tender bonds the payment of the
principal of and interest on which is fully supported by a letter of credit
issued by a United States bank whose long-term certificates of deposit are rated
at least AA or the equivalent thereof by Standard & Poor's Corporation and Aa or
the equivalent thereof by Xxxxx'x Investors Service, Inc.; and/or (v) Permitted
Acquisitions.
SECTION 5.07. Negative Pledge. Neither the Borrower nor any
Consolidated Subsidiary will create, assume or suffer to exist any Lien on any
asset now owned or hereafter acquired by it, except:
(a) Liens existing on the date of this Agreement securing Debt
outstanding on the date of this Agreement in an aggregate principal amount not
exceeding $8,700,000;
(b) any Lien existing on any asset of any corporation at the
time such corporation becomes a Consolidated Subsidiary and not created in
contemplation of such event;
(c) any Lien on any asset securing Debt incurred or assumed
for the purpose of financing all or any part of the cost of acquiring or
constructing such asset, provided that: (1) such Lien attaches to such asset
concurrently with or within 18 months after the acquisition or completion of
construction thereof; (2) no proceeds of any Loan are used to finance all or any
part of the cost of acquiring or constructing such asset; (3) the principal
amount of any Debt referred to in this Section 5.07(c) shall not exceed 80% of
the greater of (x) the cost of the newly acquired asset covered thereby to the
Borrower or any of its Subsidiaries acquiring the same or (y) the fair market
value of such asset, as determined by an independent appraiser of recognized
standing reasonably acceptable to the Agent; and (4) each such Lien shall be
confined only to the asset financed by the Debt referred to in this Section
5.07(c) and, if required by the terms of the instrument originally creating such
Lien, other property which is an improvement to, or which is acquired for
specific use in connection with, or which is real property being improved by,
such asset;
(d) any Lien on any asset of any corporation existing at the
time such corporation is merged or consolidated with or into the Borrower or a
Consolidated Subsidiary and not created in contemplation of such event;
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(e) any Lien existing on any asset prior to the acquisition
thereof by the Borrower or a Consolidated Subsidiary and not created in
contemplation of such acquisition;
(f) Liens securing Debt owing by any Subsidiary to the
Borrower;
(g) any Lien arising out of the refinancing, extension,
renewal or refunding of any Debt secured by any Lien permitted by any of the
foregoing clauses of this Section, provided that (i) such Debt is not secured by
any additional assets, and (ii) the amount of such Debt secured by any such Lien
is not increased;
(h) Liens incidental to the conduct of its business or the
ownership of its assets which (i) do not secure Debt and (ii) do not in the
aggregate materially detract from the value of its assets or materially impair
the use thereof in the operation of its business;
(i) any Lien on Margin Stock; and
(j) Liens not otherwise permitted by the foregoing clauses of
this Section securing Debt (other than indebtedness represented by the Notes) in
an aggregate principal amount at any time outstanding not to exceed 5% of
Consolidated Net Worth.
SECTION 5.08. Maintenance of Existence. The Borrower shall,
and shall cause each Subsidiary to, maintain its corporate existence and carry
on its business in substantially the same manner and in substantially the same
fields as such business is now carried on and maintained.
SECTION 5.09. Dissolution. Neither the Borrower nor any of its
Subsidiaries shall suffer or permit dissolution or liquidation either in whole
or in part or redeem or retire any shares of its own stock or that of any
Subsidiary, except through corporate reorganization to the extent permitted by
Section 5.10.
SECTION 5.10. Consolidations, Mergers and Sales of Assets. The
Borrower will not, nor will it permit any Subsidiary to, consolidate or merge
with or into, or sell, lease or otherwise transfer all or any substantial part
of its assets to, any other Person, or discontinue or eliminate any business
line or segment, provided that (a) the Borrower may merge with another Person
(including, without limitation, a Subsidiary of the Borrower) if (i) such Person
was organized under the laws of the United States of America or one of its
states, (ii) the Borrower is the corporation surviving such merger and (iii)
immediately after giving effect to such merger, no Default shall have occurred
and be continuing, (b) Subsidiaries of the Borrower may merge with one another,
and (c) the foregoing limitation on the sale, lease or other transfer of assets
and on the discontinuation or elimination of a business line or segment shall
not prohibit, during any Fiscal Quarter, a transfer of assets or the
discontinuance or elimination of a business line or segment (in a single
transaction or in a series of related transactions) unless the aggregate assets
to be so transferred or utilized in a business line or segment to be so
discontinued, when combined with all other assets transferred, and all other
assets utilized in all other business lines or segments discontinued, during
such Fiscal Quarter and the immediately preceding seven Fiscal Quarters, either
(x) constituted more than 5% of Consolidated
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Total Assets at the end of the eighth Fiscal Quarter immediately preceding such
Fiscal Quarter, or (y) contributed more than 5% of Consolidated Operating
Profits during the 8 consecutive Fiscal Quarters immediately preceding such
Fiscal Quarter.
SECTION 5.11. Use of Proceeds. No portion of the proceeds of
the Loans will be used by the Borrower or any Subsidiary (i) in connection with,
either directly or indirectly, any tender offer for, or other acquisition of,
capital stock of any corporation with a view towards obtaining control of such
other corporation (other than in connection with a tender offer for, or other
acquisition of, capital stock that constitutes a Permitted Acquisition), (ii)
directly or indirectly, for the purpose, whether immediate, incidental or
ultimate, of purchasing or carrying any Margin Stock, or (iii) for any purpose
in violation of any applicable law or regulation.
SECTION 5.12. Compliance with Laws; Payment of Taxes. The
Borrower will, and will cause each of its Subsidiaries and each member of the
Controlled Group to, comply with applicable laws (including but not limited to
ERISA), regulations and similar requirements of governmental authorities
(including but not limited to PBGC), except where the necessity of such
compliance is being contested in good faith through appropriate proceedings
diligently pursued. The Borrower will, and will cause each of its Subsidiaries
to, pay promptly when due all taxes, assessments, governmental charges, claims
for labor, supplies, rent and other obligations which, if unpaid, might become a
lien against the property of the Borrower or any Subsidiary, except liabilities
being contested in good faith by appropriate proceedings diligently pursued and
against which, if requested by the Agent, the Borrower shall have set up
reserves in accordance with GAAP.
SECTION 5.13. Insurance. The Borrower will maintain, and will
cause each of its Subsidiaries to maintain (either in the name of the Borrower
or in such Subsidiary's own name), with financially sound and reputable
insurance companies, insurance on all its Property in at least such amounts and
against at least such risks as are usually insured against in the same general
area by companies of established repute engaged in the same or similar business.
SECTION 5.14. Change in Fiscal Year. The Borrower will not
change its Fiscal Year without the consent of the Required Banks.
SECTION 5.15. Maintenance of Property. The Borrower shall, and
shall cause each Subsidiary to, maintain all of its properties and assets in
good condition, repair and working order, ordinary wear and tear excepted.
SECTION 5.16. Environmental Notices. The Borrower shall
furnish to the Banks and the Agent prompt written Notice of all Environmental
Liabilities, pending, threatened or anticipated Environmental Proceedings,
Environmental Notices, Environmental Judgments and Orders, and Environmental
Releases at, on, in, under or in any way affecting the Properties or any
adjacent property, and all facts, events, or conditions that could lead to any
of the foregoing.
SECTION 5.17. Environmental Matters. The Borrower and its
Subsidiaries will not, and will not permit any Third Party to, use, produce,
manufacture, process, treat, recycle, generate,
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store, dispose of, manage at, or otherwise handle or ship or transport to or
from the Properties any Hazardous Materials except for Hazardous Materials such
as cleaning solvents, pesticides, foundry residuals, plating residuals, grinding
residuals and other similar materials used, produced, manufactured, processed,
treated, recycled, generated, stored, disposed, managed or otherwise handled in
the ordinary course of business in compliance with all applicable Environmental
Requirements.
SECTION 5.18. Environmental Release. The Borrower agrees that
upon the occurrence of an Environmental Release at or on any of the Properties
it will act immediately to investigate the extent of, and to take appropriate
remedial action to eliminate, such Environmental Release, whether or not ordered
or otherwise directed to do so by any Environmental Authority.
SECTION 5.19. Debt. No Subsidiary of the Borrower shall at any
time incur, create, assume, or permit to exist any Debt except: (1) Debt owing
to the Borrower or another Subsidiary of the Borrower; (2) Debt outstanding on
the date of this Agreement described on Schedule 5.19; (3) Debt incurred or
assumed for the purpose of financing all or any part of the cost of acquiring or
constructing an asset of such Subsidiary and secured by a Lien permitted under
Section 5.07(c); (4) Debt secured by a Lien permitted under Section 5.07(j); and
(5) Debt, in addition to Debt permitted under clauses (1), (2), (3) and (4) of
this Section 5.19, provided that the aggregate outstanding principal amount of
Debt of all Subsidiaries of the Borrower incurred under this clause (5) shall
not at any time exceed five percent (5%) of Consolidated Net Worth; provided,
further, the aggregate outstanding principal amount of Debt of all Subsidiaries
of the Borrower permitted by the foregoing clauses (2), (3), (4) and (5) of this
Section 5.19 shall not at any time exceed twenty percent (20%) of Consolidated
Net Worth.
SECTION 5.20. Transactions with Affiliates. Neither the
Borrower nor any of its Subsidiaries shall enter into, or be a party to, any
transaction with any Affiliate of the Borrower or such Subsidiary (which
Affiliate is not the Borrower or a Subsidiary), except as permitted by law and
in the ordinary course of business and pursuant to reasonable terms which are
fully disclosed to the Agent and to the Banks, consented to in writing by the
Required Banks, and are no less favorable to Borrower or such Subsidiary than
would be obtained in a comparable arm's length transaction with a Person which
is not an Affiliate.
ARTICLE VI
DEFAULTS
SECTION 6.01. Events of Default. If one or more of the
following events ("Events of Default") shall have occurred and be continuing:
(a) the Borrower shall fail to pay when due any principal of
any Loan or shall fail to pay any interest on any Loan within five Domestic
Business Days after such interest shall become due, or shall fail to pay any fee
or other amount payable hereunder within five Domestic Business Days after such
fee or other amount becomes due; or
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(b) the Borrower shall fail to observe or perform any covenant
contained in Sections 5.01(i), 5.02(ii), 5.03 to 5.11, inclusive, or Section
5.14, 5.19 or 5.20; or
(c) the Borrower shall fail to observe or perform any covenant
or agreement contained or incorporated by reference in this Agreement (other
than those covered by clause (a) or (b) above) for thirty days after the earlier
of (i) the first day on which the Borrower has knowledge of such failure or (ii)
written Notice thereof has been given to the Borrower by the Agent at the
request of any Bank; or
(d) any representation, warranty, certification or statement
made or deemed made by the Borrower in Article IV of this Agreement or in any
certificate, financial statement or other document delivered pursuant to this
Agreement shall prove to have been incorrect or misleading in any material
respect when made (or deemed made); or
(e) the Borrower or any Subsidiary shall fail to make any
payment in respect of Debt outstanding (other than the Notes) in an aggregate
principal amount in excess of $5,000,000 when due or within any applicable grace
period; or
(f) any event or condition shall occur which results in the
acceleration of the maturity of Debt outstanding of the Borrower or any
Subsidiary in an aggregate principal amount in excess of $5,000,000 or the
mandatory prepayment or purchase of such Debt by the Borrower (or its designee)
or such Subsidiary (or its designee) prior to the scheduled maturity thereof, or
enables (or, with the giving of notice or lapse of time or both, would enable)
the holders of such Debt or any Person acting on such holders' behalf to
accelerate the maturity thereof or require the mandatory prepayment or purchase
thereof prior to the scheduled maturity thereof, without regard to whether such
holders or other Person shall have exercised or waived their right to do so; or
(g) the Borrower or any Subsidiary shall commence a voluntary
case or other proceeding seeking liquidation, reorganization or other relief
with respect to itself or its debts under any bankruptcy, insolvency or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally, or shall admit in writing its
inability, to pay its debts as they become due, or shall take any corporate
action to authorize any of the foregoing; or
(h) an involuntary case or other proceeding shall be commenced
against the Borrower or any Subsidiary seeking liquidation, reorganization or
other relief with respect to it or its debts under any bankruptcy, insolvency or
other similar law now or hereafter in effect or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other proceeding
shall remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Borrower or any Subsidiary under the federal
bankruptcy laws as now or hereafter in effect; or
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(i) the Borrower or any member of the Controlled Group shall
fail to pay when due any material amount which it shall have become liable to
pay to the PBGC or to a Plan under Title IV of ERISA; or notice of intent to
terminate a Plan or Plans shall be filed under Title IV of ERISA by the
Borrower, any member of the Controlled Group, any plan administrator or any
combination of the foregoing or the PBGC shall institute proceedings under Title
IV of ERISA to terminate or to cause a trustee to be appointed to administer any
such Plan or Plans or a proceeding shall be instituted by a fiduciary of any
such Plan or Plans to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within 30 days thereafter; or a
condition shall exist by reason of which the PBGC would be entitled to obtain a
decree adjudicating that any such Plan or Plans must be terminated; or the
Borrower or any other member of the Controlled Group shall enter into,
contribute or be obligated to contribute to, terminate or incur any withdrawal
liability with respect to, a Multiemployer Plan; or
(j) one or more judgments or orders for the payment of money
in an aggregate amount in excess of $500,000 shall be rendered against the
Borrower or any Subsidiary and such judgment or order shall continue unsatisfied
and unstayed for a period of 30 days; or
(k) a federal tax lien shall be filed against the Borrower
under Section 6323 of the Code or a lien of the PBGC shall be filed against the
Borrower or any Subsidiary under Section 4068 of ERISA and in either case such
lien shall remain undischarged for a period of 25 days after the date of filing;
or
(l) (i) any Person or two or more Persons acting in concert
shall have acquired beneficial ownership (within the meaning of Rule 13d-3 of
the Securities and Exchange Commission under the Securities Exchange Act of
1934) of 20% or more of the outstanding shares of the voting stock of the
Borrower; or (ii) as of any date a majority of the Board of Directors of the
Borrower consists of individuals who were not either (A) directors of the
Borrower as of the corresponding date of the previous year, (B) selected or
nominated to become directors by the Board of Directors of the Borrower of which
a majority consisted of individuals described in clause (A), or (C) selected or
nominated to become directors by the Board of Directors of the Borrower of which
a majority consisted of individuals described in clause (A) and individuals
described in clause (B);
then, and in every such event, the Agent shall (i) if requested by the Required
Banks, by Notice to the Borrower terminate the Commitments and they shall
thereupon terminate, and (ii) if requested by the Required Banks, by Notice to
the Borrower declare the Notes (together with accrued interest thereon) and all
other amounts payable hereunder and under the other Loan Documents to be, and
the Notes (together will all accrued interest thereon) and all other amounts
payable hereunder and under the other Loan Documents shall thereupon become,
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of which are hereby waived by the Borrower; provided that if
any Event of Default specified in clause (g) or (h) above occurs with respect to
the Borrower, without any notice to the Borrower or any other act by the Agent
or the Banks, the Commitments shall thereupon automatically terminate and the
Notes (together with accrued interest thereon) and all other amounts payable
hereunder and under the other Loan Documents shall automatically become
immediately due and payable without presentment, demand, protest or other notice
of any kind, all of
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which are hereby waived by the Borrower. Notwithstanding the foregoing, the
Agent shall have available to it all other remedies at law or equity, and shall
exercise any one or all of them at the request of the Required Banks.
SECTION 6.02. Notice of Default. The Agent shall give Notice
to the Borrower of any Default under Section 6.01(c) promptly upon being
requested to do so by any Bank and shall thereupon notify all the Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. Appointment, Powers and Immunities. Each Bank
hereby irrevocably appoints and authorizes the Agent to act as its agent
hereunder and under the other Loan Documents with such powers as are
specifically delegated to the Agent by the terms hereof and thereof, together
with such other powers as are reasonably incidental thereto. The Agent: (a)
shall have no duties or responsibilities except as expressly set forth in this
Agreement and the other Loan Documents, and shall not by reason of this
Agreement or any other Loan Document be a trustee for any Bank; (b) shall not be
responsible to the Banks for any recitals, statements, representations or
warranties contained in this Agreement or any other Loan Document, or in any
certificate or other document referred to or provided for in, or received by any
Bank under, this Agreement or any other Loan Document, or for the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document or any other document referred to or provided for herein
or therein or for any failure by the Borrower to perform any of its obligations
hereunder or thereunder; (c) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder or under any other Loan Document
except to the extent requested by the Required Banks, and then only on terms and
conditions satisfactory to the Agent, and (d) shall not be responsible for any
action taken or omitted to be taken by it hereunder or under any other Loan
Document or any other document or instrument referred to or provided for herein
or therein or in connection herewith or therewith, except for its own gross
negligence or willful misconduct. The Agent may employ agents and
attorneys-in-fact and shall not be responsible for the negligence or misconduct
of any such agents or attorneys-in-fact selected by it with reasonable care. The
provisions of this Article VII are solely for the benefit of the Agent and the
Banks, and the Borrower shall not have any rights as a third party beneficiary
of any of the provisions hereof. In performing its functions and duties under
this Agreement and under the other Loan Documents, the Agent shall act solely as
agent of the Banks and does not assume and shall not be deemed to have assumed
any obligation towards or relationship of agency or trust with or for the
Borrower. The duties of the Agent shall be ministerial and administrative in
nature, and the Agent shall not have by reason of this Agreement or any other
Loan Document a fiduciary relationship in respect of any Bank.
SECTION 7.02. Reliance by Agent. The Agent shall be entitled
to rely upon any certification, notice or other communication (including any
thereof by telephone, telefax, telegram or cable) believed by it to be genuine
and correct and to have been signed or sent by or on behalf of the proper Person
or Persons, and upon advice and statements of legal counsel, independent
accountants
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or other experts selected by the Agent. As to any matters not expressly provided
for by this Agreement or any other Loan Document, the Agent shall in all cases
be fully protected in acting, or in refraining from acting, hereunder and
thereunder in accordance with instructions signed by the Required Banks, and
such instructions of the Required Banks in any action taken or failure to act
pursuant thereto shall be binding on all of the Banks.
SECTION 7.03. Defaults. The Agent shall not be deemed to have
knowledge of the occurrence of a Default or an Event of Default (other than the
non-payment of principal of or interest on the Loans) unless the Agent has
received Notice from a Bank or the Borrower specifying 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 of the occurrence of a Default or an Event of
Default, the Agent shall give prompt Notice thereof to the Banks. The Agent
shall give each Bank prompt Notice of each non-payment of principal of or
interest on the Loans, whether or not it has received any notice of the
occurrence of such non-payment. The Agent shall (subject to Section 9.05) take
such action with respect to such Default or Event of Default as shall be
directed by the Required Banks, 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 it shall deem advisable in the best interests of
the Banks.
SECTION 7.04. Rights of Agent and Its Affiliates as a Bank.
With respect to any Loan made by Wachovia or an Affiliate of Wachovia, such
Affiliate and Wachovia in their capacity as a Bank hereunder shall have the same
rights and powers hereunder as any other Bank and may exercise the same as
though it were not an Affiliate of Wachovia (or in Wachovia's case, acting as
the Agent), and the term "Bank" or "Banks" shall, unless the context otherwise
indicates, include such Affiliate of Wachovia or Wachovia in its individual
capacity. Such Affiliate and Wachovia may (without having to account therefor to
any Bank) accept deposits from, lend money to and generally engage in any kind
of banking, trust or other business with the Borrower (and any of its
Affiliates) as if they were not an Affiliate of the Agent or the Agent,
respectively; and such Affiliate and Wachovia may accept fees and other
consideration from the Borrower (in addition to any agency fees and arrangement
fees heretofore agreed to between the Borrower and Wachovia) for services in
connection with this Agreement or any other Loan Document or otherwise without
having to account for the same to the Banks.
SECTION 7.05. Indemnification. Each Bank severally agrees to
indemnify the Agent, to the extent the Agent shall not have been reimbursed by
the Borrower, ratably in accordance with its Commitment, for any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses (including, without limitation, counsel fees and disbursements)
or disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent in any way relating to or arising out
of this Agreement or any other Loan Document or any other documents contemplated
by or referred to herein or therein or the transactions contemplated hereby or
thereby (excluding, unless an Event of Default has occurred and is continuing,
the normal administrative costs and expenses incident to the performance of its
agency duties hereunder) or the enforcement of any of the terms hereof or
thereof or any such other documents; provided, however, that no Bank shall be
liable for any of the foregoing to the extent they arise from the gross
negligence
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or willful misconduct of the Agent. If any indemnity furnished to the Agent for
any purpose shall, in the opinion of the Agent, be insufficient or become
impaired, the Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is
furnished.
SECTION 7.06. CONSEQUENTIAL DAMAGES. THE AGENT SHALL NOT BE
RESPONSIBLE OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER PERSON OR ENTITY
FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH MAY BE ALLEGED AS A
RESULT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS, OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
SECTION 7.07. Payee of Note Treated as Owner. The Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
hereof unless and until a written Notice of the assignment or transfer thereof
shall have been filed with the Agent and the provisions of Section 9.07(c) have
been satisfied. Any requests, authority or consent of any Person who at the time
of making such request or giving such authority or consent is the holder of any
Note shall be conclusive and binding on any subsequent holder, transferee or
assignee of that Note or of any Note or Notes issued in exchange therefor or
replacement thereof.
SECTION 7.08. Non-Reliance on Agent and Other Banks. Each Bank
agrees that it has, independently and without reliance on the Agent or any other
Bank, and based on such documents and information as it has deemed appropriate,
made its own credit analysis of the Borrower and decision to enter into this
Agreement and that it will, independently and without reliance upon the Agent or
any other Bank, and based on such documents and information as it shall deem
appropriate at the time, continue to make its own analysis and decisions in
taking or not taking action under this Agreement or any of the other Loan
Documents. The Agent shall not be required to keep itself (or any Bank) informed
as to the performance or observance by the Borrower of this Agreement or any of
the other Loan Documents or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Borrower or any
other Person. Except for notices, reports and other documents and information
expressly required to be furnished to the Banks by the Agent hereunder or under
the other Loan Documents, the Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the affairs,
financial condition or business of the Borrower or any other Person (or any of
their Affiliates) which may come into the possession of the Agent.
SECTION 7.09. Failure to Act. Except for action expressly
required of the Agent hereunder or under the other Loan Documents, the Agent
shall in all cases be fully justified in failing or refusing to act hereunder
and thereunder unless it shall receive further assurances to its satisfaction by
the Banks of their indemnification obligations under Section 7.05 against any
and all liability and expense which may be incurred by the Agent by reason of
taking, continuing to take, or failing to take any such action.
SECTION 7.10. Resignation or Removal of Agent. Subject to the
appointment and acceptance of a successor Agent as provided below, the Agent may
resign at any time by giving Notice
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thereof to the Banks and the Borrower and the Agent may be removed at any time
with or without cause by the Required Banks. Upon any such resignation or
removal, the Required Banks shall have the right to appoint a successor Agent.
If no successor Agent shall have been so appointed by the Required Banks and
shall have accepted such appointment within 30 days after the retiring Agent's
notice of resignation or the Required Banks' removal of the retiring Agent, then
the retiring Agent may, on behalf of the Banks, appoint a successor Agent. Any
successor Agent shall be a bank which has a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as Agent hereunder by
a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal hereunder as Agent,
the provisions of this Article VII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Agent hereunder.
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. Basis for Determining Interest Rate Inadequate
or Unfair. If on or prior to the first day of any Interest Period:
(a) the Agent determines that deposits in Dollars (in the
applicable amounts) are not being offered in the relevant market for such
Interest Period, or
(b) the Required Banks advise the Agent that the London
Interbank Offered Rate as determined by the Agent will not adequately and fairly
reflect the cost to such Banks of funding the Euro-Dollar Loans for such
Interest Period,
the Agent shall forthwith give Notice thereof to the Borrower and the Banks,
whereupon until the Agent notifies the Borrower that the circumstances giving
rise to such suspension no longer exist, the obligations of the Banks to make
Euro-Dollar Loans shall be suspended. Unless the Borrower notifies the Agent at
least 1 Domestic Business Day before the date of any Borrowing of a Euro-Dollar
Loan for which a Notice of Borrowing has previously been given that it elects
not to borrow on such date, such Borrowing shall instead be made as a Base Rate
Borrowing.
SECTION 8.02. Illegality. If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change in any
existing or future law, rule or regulation, or any change in the interpretation
or administration thereof by any governmental authority, central bank or
comparable agency charged with the interpretation or administration thereof (any
such authority, bank or agency being referred to as an "Authority" and any such
event being referred to as a "Change of Law"), or compliance by any Bank (or its
Lending Office) with any request or directive (whether or not having the force
of law) of any Authority shall make it unlawful or impossible for any Bank (or
its Lending Office) to make, maintain or fund its Euro-Dollar Loans and such
Bank shall so notify the Agent, the Agent shall forthwith give Notice thereof to
the other Banks and the Borrower, whereupon until such Bank notifies the
Borrower and the Agent that the circumstances giving rise to such
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suspension no longer exist, the obligation of such Bank to make Euro-Dollar
Loans shall be suspended. Before giving any Notice to the Agent pursuant to this
Section, such Bank shall designate a different Lending Office if such
designation will avoid the need for giving such Notice and will not, in the
judgment of such Bank, be otherwise disadvantageous to such Bank. If such Bank
shall determine that it may not lawfully continue to maintain and fund any of
its outstanding Euro-Dollar Loans to maturity and shall so specify in such
Notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each Euro-Dollar Loan of such Bank, together with accrued
interest thereon and any amount due such Bank pursuant to Section 8.05(a).
Concurrently with prepaying each such Euro-Dollar Loan, the Borrower shall
borrow a Base Rate Loan in an equal principal amount from such Bank (on which
interest and principal shall be payable contemporaneously with the related
Euro-Dollar Loans of the other Banks), and such Bank shall make such a Base Rate
Loan.
SECTION 8.03. Increased Cost and Reduced Return. (a) If after
the date hereof, a Change of Law or compliance by any Bank (or its Lending
Office) with any request or directive (whether or not having the force of law)
of any Authority:
(i) shall subject any Bank (or its Lending Office)
to any tax, duty or other charge with respect to its
Euro-Dollar Loans, its Notes or its obligation to make
Euro-Dollar Loans, or shall change the basis of taxation of
payments to any Bank (or its Lending Office) of the principal
of or interest on its Euro-Dollar Loans or any other amounts
due under this Agreement in respect of its Euro-Dollar Loans
or its obligation to make Euro-Dollar Loans (except for
changes in the rate of tax on the overall net income of such
Bank or its Lending Office imposed by the jurisdiction in
which such Bank's principal executive office or Lending Office
is located); or
(ii) shall impose, modify or deem applicable any
reserve, special deposit or similar requirement (including,
without limitation, any such requirement imposed by the Board
of Governors of the Federal Reserve System, but excluding with
respect to any Euro-Dollar Loan any such requirement included
in an applicable Euro-Dollar Reserve Percentage) against
assets of, deposits with or for the account of, or credit
extended by, any Bank (or its Lending Office); or
(iii) shall impose on any Bank (or its Lending
Office) or on the London interbank market any other condition
affecting its Euro-Dollar Loans, its Notes or its obligation
to make Euro-Dollar Loans;
and the result of any of the foregoing is to increase the cost to such Bank (or
its Lending Office) of making or maintaining any Euro-Dollar Loan, or to reduce
the amount of any sum received or receivable by such Bank (or its Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after demand by
such Bank (with a copy to the Agent), the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such increased
cost or reduction.
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(b) If any Bank shall have determined that after the date
hereof the adoption of any applicable law, rule or regulation regarding capital
adequacy, or any change in any existing or future law, rule or regulation, or
any change in the interpretation or administration thereof, or compliance by any
Bank (or its Lending Office) with any request or directive regarding capital
adequacy (whether or not having the force of law) of any Authority, has or would
have the effect of reducing the rate of return on such Bank's capital as a
consequence of its obligations hereunder to a level below that which such Bank
could have achieved but for such adoption, change or compliance (taking into
consideration such Bank's policies with respect to capital adequacy) by an
amount deemed by such Bank to be material, then from time to time, within 15
days after demand by such Bank, the Borrower shall pay to such Bank such
additional amount or amounts as will compensate such Bank for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date hereof, which
will entitle such Bank to compensation pursuant to this Section and will
designate a different Lending Office if such designation will avoid the need
for, or reduce the amount of, such compensation and will not, in the judgment of
such Bank, be otherwise disadvantageous to such Bank. A certificate of any Bank
claiming compensation under this Section and setting forth the additional amount
or amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, such Bank may use any reasonable
averaging and attribution methods.
(d) The provisions of this Section 8.03 shall be applicable
with respect to any Participant, Assignee or other Transferee, and any
calculations required by such provisions shall be made based upon the
circumstances of such Participant, Assignee or other Transferee.
SECTION 8.04. Base Rate Loans Substituted for Affected
Euro-Dollar Loans. If (i) the obligation of any Bank to make or maintain
Euro-Dollar Loans has been suspended pursuant to Section 8.02 or (ii) any Bank
has demanded compensation under Section 8.03, and the Borrower shall, by at
least 5 Euro-Dollar Business Days' prior notice to such Bank through the Agent,
have elected that the provisions of this Section shall apply to such Bank, then,
unless and until such Bank notifies the Borrower that the circumstances giving
rise to such suspension or demand for compensation no longer apply:
(a) all Loans which would otherwise be made by such Bank as
Euro-Dollar Loans shall be made instead as Base Rate Loans (in all cases
interest and principal on such Loans shall be payable contemporaneously with the
related Euro-Dollar Loans of the other Banks), and
(b) after each of its Euro-Dollar Loans has been repaid, all
payments of principal which would otherwise be applied to repay such Euro-Dollar
Loans shall be applied to repay its Base Rate Loans instead.
In the event that the Borrower shall elect that the provisions of this Section
shall apply to any Bank, the Borrower shall remain liable for, and shall pay to
such Bank as provided herein, all amounts due such Bank under Section 8.03 in
respect of the period preceding the date of conversion of such Bank's Loans
resulting from the Borrower's election.
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SECTION 8.05. Compensation. Upon the request of any Bank,
delivered to the Borrower and the Agent, the Borrower shall pay to such Bank
such amount or amounts as shall compensate such Bank for any loss, cost or
expense incurred by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.09,
Section 2.10, Section 8.02 or otherwise) of a Euro-Dollar Loan on a date other
than the last day of an Interest Period for such Euro-Dollar Loan;
(b) any failure by the Borrower to prepay a Euro-Dollar Loan
on the date for such prepayment specified in the relevant Notice of prepayment
hereunder; or
(c) any failure by the Borrower to borrow a Euro-Dollar Loan
on the date for the Euro-Dollar Borrowing of which such Euro-Dollar Loan is a
part specified in the applicable Notice of Borrowing delivered pursuant to
Section 2.02;
such compensation to include, without limitation, an amount equal to the excess,
if any, of (x) the amount of interest which would have accrued on the amount so
paid or prepaid or not prepaid or borrowed for the period from the date of such
payment, prepayment or failure to prepay or borrow to the last day of the then
current Interest Period for such Euro-Dollar Loan (or, in the case of a failure
to prepay or borrow, the Interest Period for such Euro-Dollar Loan which would
have commenced on the date of such failure to prepay or borrow) at the
applicable rate of interest for such Euro-Dollar Loan provided for herein over
(y) the amount of interest (as reasonably determined by such Bank) such Bank
would have paid on deposits in Dollars of comparable amounts having terms
comparable to such period placed with it by leading banks in the London
interbank market.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
transmission or similar writing) and shall be given to such party at its address
or telecopy number set forth on the signature pages hereof or such other address
or telecopy number as such party may hereafter specify for the purpose by Notice
to each other party. Each such notice, request or other communication shall be
effective (i) if given by telecopier, when such telecopy is transmitted to the
telecopy number specified in this Section and the telecopy machine used by the
sender provides a written confirmation that such telecopy has been so
transmitted or receipt of such telecopy transmission is otherwise confirmed,
(ii) if given by mail, 72 hours after such communication is deposited in the
mails with first class postage prepaid, addressed as aforesaid, and (iii) if
given by any other means, when delivered at the address specified in this
Section; provided that Notices to the Agent under Article II or Article VIII
shall not be effective until received.
SECTION 9.02. No Waivers. No failure or delay by the Agent or
any Bank in exercising any right, power or privilege hereunder or under any Note
or other Loan Document shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further
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exercise thereof or the exercise of any other right, power or privilege. The
rights and remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
SECTION 9.03. Expenses; Documentary Taxes; Indemnification.
(a) The Borrower shall pay (i) all out-of-pocket expenses of the Agent,
including fees and disbursements of special counsel for the Banks and the Agent,
in connection with the preparation of this Agreement and the other Loan
Documents, any waiver or consent hereunder or thereunder or any amendment hereof
or thereof or any Default or alleged Default hereunder or thereunder and (ii) if
a Default occurs, all out-of-pocket expenses incurred by the Agent or any Bank,
including fees and disbursements of counsel, in connection with such Default and
collection and other enforcement proceedings resulting therefrom, including
out-of-pocket expenses incurred in enforcing this Agreement and the other Loan
Documents.
(b) The Borrower shall indemnify the Agent and each Bank
against any transfer taxes, documentary taxes, assessments or charges made by
any Authority by reason of the execution and delivery of this Agreement or the
other Loan Documents.
(c) The Borrower shall indemnify the Agent, the Banks and each
Affiliate thereof and their respective directors, officers, employees and agents
from, and hold each of them harmless against, any and all losses, liabilities,
claims or damages to which any of them may become subject, insofar as such
losses, liabilities, claims or damages arise out of or result from any actual or
proposed use by the Borrower of the proceeds of any extension of credit by any
Bank hereunder or breach by the Borrower of this Agreement or any other Loan
Document or from investigation, litigation (including, without limitation, any
actions taken by the Agent or any of the Banks to enforce this Agreement or any
of the other Loan Documents) or other proceeding (including, without limitation,
any threatened investigation or proceeding) relating to the foregoing, and the
Borrower shall reimburse the Agent and each Bank, and each Affiliate thereof and
their respective directors, officers, employees and agents, upon demand for any
expenses (including, without limitation, legal fees) incurred in connection with
any such investigation or proceeding; but excluding any such losses,
liabilities, claims, damages or expenses incurred by reason of the gross
negligence or willful misconduct of the Person to be indemnified.
SECTION 9.04. Set-Offs; Sharing of Set-Offs. (a) The Borrower
hereby grants to each Bank, as security for the full and punctual payment and
performance of the obligations of the Borrower under this Agreement, a
continuing lien on and security interest in all deposits and other sums credited
by or due from such Bank to the Borrower or subject to withdrawal by the
Borrower; and regardless of the adequacy of any collateral or other means of
obtaining repayment of such obligations, each Bank may at any time upon or after
the occurrence of any Event of Default, and without notice of any type to the
Borrower, set off the whole or any portion or portions of any or all such
deposits and other sums against such obligations, whether or not any other
Person or Persons could also withdraw money therefrom.
(b) Each Bank agrees that if it shall, by exercising any right
of set-off or counterclaim or otherwise, receive payment of a proportion of the
aggregate amount of principal and interest owing with respect to the Notes held
by it which is greater than the proportion received by any
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49
other Bank in respect of the aggregate amount of all principal and interest
owing with respect to the Notes held by such other Bank, the Bank receiving such
proportionately greater payment shall purchase such participations in the Notes
held by the other Banks owing to such other Banks, and/or such other adjustments
shall be made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks owing to such other Banks
shall be shared by the Banks pro rata; provided that (i) nothing in this Section
shall impair the right of any Bank to exercise any right of set-off or
counterclaim it may have and to apply the amount subject to such exercise to the
payment of indebtedness of the Borrower other than its indebtedness under the
Notes, and (ii) if all or any portion of such payment received by the purchasing
Bank is thereafter recovered from such purchasing Bank, such purchase from each
other Bank shall be rescinded and such other Bank shall repay to the purchasing
Bank the purchase price of such participation to the extent of such recovery
together with an amount equal to such other Bank's ratable share (according to
the proportion of (x) the amount of such other Bank's required repayment to (y)
the total amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total amount so
recovered. The Borrower agrees, to the fullest extent it may effectively do so
under applicable law, that any holder of a participation in a Note, whether or
not acquired pursuant to the foregoing arrangements, may exercise rights of
set-off or counterclaim and other rights with respect to such participation as
fully as if such holder of a participation were a direct creditor of the
Borrower in the amount of such participation.
SECTION 9.05. Amendments and Waivers. (a) Any provision of
this Agreement, the Notes or any other Loan Documents may be amended or waived
if, but only if, such amendment or waiver is in writing and is signed by the
Borrower and the Required Banks (and, if the rights or duties of the Agent are
affected thereby, by the Agent); provided that no such amendment or waiver
shall, unless signed by all the Banks, (i) change the Commitment of any Bank or
subject any Bank to any additional obligation, (ii) change the principal of or
rate of interest on any Loan or any fees hereunder, (iii) change the date fixed
for any payment of principal of or interest on any Loan or any fees hereunder,
(iv) change the amount of principal, interest or fees due on any date fixed for
the payment thereof, (v) change the percentage of the Commitments or of the
aggregate unpaid principal amount of the Notes, or the percentage of Banks,
which shall be required for the Banks or any of them to take any action under
this Section or any other provision of this Agreement, (vi) change the manner of
application of any payments made under this Agreement or the Notes, (vii)
release or substitute all or any substantial part of the collateral (if any)
held as security for the Loans, or (viii) release any guaranty given to support
payment of the Loans.
(b) The Borrower will not solicit, request or negotiate for or
with respect to any proposed waiver or amendment of any of the provisions of
this Agreement unless each Bank shall be informed thereof by the Borrower and
shall be afforded an opportunity of considering the same and shall be supplied
by the Borrower with sufficient information to enable it to make an informed
decision with respect thereto. Executed or true and correct copies of any waiver
or consent effected pursuant to the provisions of this Agreement shall be
delivered by the Borrower to each Bank forthwith following the date on which the
same shall have been executed and delivered by the requisite percentage of
Banks. The Borrower will not, directly or indirectly, pay or cause to be paid
any remuneration, whether by way of supplemental or additional interest, fee or
otherwise, to any Bank
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50
(in its capacity as such) as consideration for or as an inducement to the
entering into by such Bank of any waiver or amendment of any of the terms and
provisions of this Agreement unless such remuneration is concurrently paid, on
the same terms, ratably to all such Banks.
SECTION 9.06. Margin Stock Collateral. Each of the Banks
represents to the Agent and each of the other Banks that it in good faith is
not, directly or indirectly (by negative pledge or otherwise), relying upon any
Margin Stock as collateral in the extension or maintenance of the credit
provided for in this Agreement.
SECTION 9.07. Successors and Assigns. (a) The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided that the Borrower
may not assign or otherwise transfer any of its rights under this Agreement.
(b) Any Bank may at any time sell to one or more Persons (each
a "Participant") participating interests in any Loan owing to such Bank, any
Note held by such Bank, any Commitment hereunder or any other interest of such
Bank hereunder. In the event of any such sale by a Bank of a participating
interest to a Participant, such Bank's obligations under this Agreement shall
remain unchanged, such Bank shall remain solely responsible for the performance
thereof, such Bank shall remain the holder of any such Note for all purposes
under this Agreement, and the Borrower and the Agent shall continue to deal
solely and directly with such Bank in connection with such Bank's rights and
obligations under this Agreement. In no event shall a Bank that sells a
participation be obligated to the Participant to take or refrain from taking any
action hereunder except that such Bank may agree that it will not (except as
provided below), without the consent of the Participant, agree to (i) the change
of any date fixed for the payment of principal of or interest on the related
Loan or Loans, (ii) the change of the amount of any principal, interest or fees
due on any date fixed for the payment thereof with respect to the related Loan
or Loans, (iii) the change of the principal of the related Loan or Loans, (iv)
any change in the rate at which either interest is payable thereon or (if the
Participant is entitled to any part thereof) commitment fee is payable hereunder
from the rate at which the Participant is entitled to receive interest or
commitment fee (as the case may be) in respect of such participation, (v) the
release or substitution of all or any substantial part of the collateral (if
any) held as security for the Loans, or (vi) the release of any guaranty given
to support payment of the Loans. Each Bank selling a participating interest in
any Loan, Note, Commitment or other interest under this Agreement shall, within
10 Domestic Business Days of such sale, provide the Borrower and the Agent with
written notification stating that such sale has occurred and identifying the
Participant and the interest purchased by such Participant. The Borrower agrees
that each Participant shall be entitled to the benefits of Article VIII with
respect to its participation in Loans outstanding from time to time.
(c) Any Bank may at any time assign to one or more banks or
financial institutions (each an "Assignee") all, or a proportionate part of all,
of its rights and obligations under this Agreement, the Notes and the other Loan
Documents, and such Assignee shall assume all such rights and obligations,
pursuant to an Assignment and Acceptance in the form attached hereto as Exhibit
G, executed by such Assignee, such transferor Bank and the Agent (and, in the
case of (i) an Assignee that is not then a Bank or an Affiliate of a Bank; and
(ii) an assignment not made during the existence
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51
of a Default, by the Borrower); provided that (i) no interest may be sold by a
Bank pursuant to this paragraph (c) unless the Assignee shall agree to assume
ratably equivalent portions of the transferor Bank's Commitment, (ii) the amount
of the Commitment being assigned pursuant to such assignment (determined as of
the effective date of the assignment) shall be equal to $5,000,000 (or any
larger multiple of $1,000,000), (iii) no interest may be sold by a Bank pursuant
to this paragraph (c) to any Assignee that is not then a Bank or an Affiliate of
a Bank without the consent of the Borrower, which consent shall not be
unreasonably withheld, provided that the Borrower's consent shall not be
necessary with respect to any assignment made during the existence of a Default,
(iv) a Bank may not at any one time have more than two (2) Assignees that are
not then Banks, and (v) no interest may be sold by a Bank pursuant to this
paragraph (c) to any Assignee without the consent of the Agent, which consent
shall not be unreasonably withheld. Upon (A) execution of the Assignment and
Acceptance by such transferor Bank, such Assignee, the Agent and (if applicable)
the Borrower, (B) delivery of an executed copy of the Assignment and Acceptance
to the Borrower and the Agent, (C) payment by such Assignee to such transferor
Bank of an amount equal to the purchase price agreed between such transferor
Bank and such Assignee, and (D) payment by the assigning Bank of a processing
and recordation fee of $2,500 to the Agent, such Assignee shall for all purposes
be a Bank party to this Agreement and shall have all the rights and obligations
of a Bank under this Agreement to the same extent as if it were an original
party hereto with a Commitment as set forth in such instrument of assumption,
and the transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by the Borrower, the
Banks or the Agent shall be required. Upon the consummation of any transfer to
an Assignee pursuant to this paragraph (c), the transferor Bank, the Agent and
the Borrower shall make appropriate arrangements so that, if required, a new
Note is issued to each of such Assignee and such transferor Bank.
(d) Subject to the provisions of Section 9.08, the Borrower
authorizes each Bank to disclose to any Participant, Assignee or other
transferee (each a "Transferee") and any prospective Transferee any and all
financial and other information in such Bank's possession concerning the
Borrower which has been delivered to such Bank by the Borrower pursuant to this
Agreement or which has been delivered to such Bank by the Borrower in connection
with such Bank's credit evaluation prior to entering into this Agreement.
(e) No Transferee shall be entitled to receive any greater
payment under Section 8.03 than the transferor Bank would have been entitled to
receive with respect to the rights transferred, unless such transfer is made
with the Borrower's prior written consent or by reason of the provisions of
Section 8.02 or 8.03 requiring such Bank to designate a different Lending Office
under certain circumstances or at a time when the circumstances giving rise to
such greater payment did not exist.
(f) Anything in this Section 9.07 to the contrary
notwithstanding, any Bank may assign and pledge all or any portion of the Loans
and/or obligations owing to it to any Federal Reserve Bank or the United States
Treasury as collateral security pursuant to Regulation A of the Board of
Governors of the Federal Reserve System and Operating Circular issued by such
Federal Reserve Bank, provided that any payment in respect of such assigned
Loans and/or obligations made by the Borrower to the assigning and/or pledging
Bank in accordance with the terms of this Agreement shall
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satisfy the Borrower's obligations hereunder in respect of such assigned Loans
and/or obligations to the extent of such payment. No such assignment shall
release the assigning and/or pledging Bank from its obligations hereunder.
SECTION 9.08. Confidentiality. Each Bank agrees to exercise
its best efforts to keep any information delivered or made available by the
Borrower to it which is clearly indicated to be confidential information,
confidential from anyone other than persons employed or retained by such Bank
who are or are expected to become engaged in evaluating, approving, structuring
or administering the Loans; provided, however, that nothing herein shall prevent
any Bank from disclosing such information (i) to any other Bank, (ii) upon the
order of any court or administrative agency, (iii) upon the request or demand of
any regulatory agency or authority having jurisdiction over such Bank, (iv)
which has been publicly disclosed, (v) to the extent reasonably required in
connection with any litigation to which the Agent, any Bank or their respective
Affiliates may be a party, (vi) to the extent reasonably required in connection
with the exercise of any remedy hereunder, (vii) to such Bank's legal counsel
and independent auditors and (viii) to any actual or proposed Participant,
Assignee or other Transferee of all or part of its rights hereunder which has,
prior to any such disclosure, agreed in writing to be bound by the provisions of
this Section 9.08.
SECTION 9.09. Representation by Banks. Each Bank hereby
represents that it is a commercial lender or financial institution which makes
loans in the ordinary course of its business and that it will make its Loans
hereunder for its own account in the ordinary course of such business; provided,
however, that, subject to Section 9.07, the disposition of the Note or Notes
held by that Bank shall at all times be within its exclusive control.
SECTION 9.10. Obligations Several. The obligations of each
Bank hereunder are several, and no Bank shall be responsible for the obligations
or commitment of any other Bank hereunder. Nothing contained in this Agreement
and no action taken by the Banks pursuant hereto shall be deemed to constitute
the Banks to be a partnership, an association, a joint venture or any other kind
of entity. The amounts payable at any time hereunder to each Bank shall be a
separate and independent debt, and each Bank shall be entitled to protect and
enforce its rights arising out of this Agreement or any other Loan Document and
it shall not be necessary for any other Bank to be joined as an additional party
in any proceeding for such purpose.
SECTION 9.11. Survival of Certain Obligations. Sections
8.03(a), 8.03(b), 8.05 and 9.03, and the obligations of the Borrower thereunder,
shall survive, and shall continue to be enforceable notwithstanding, the
termination of this Agreement and the Commitments and the payment in full of the
principal of and interest on all Loans.
SECTION 9.12. Georgia Law. This Agreement and each Note shall
be construed in accordance with and governed by the law of the State of Georgia.
SECTION 9.13. Severability. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other Loan
Documents should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions
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53
contained herein and therein shall not in any way be affected or impaired
thereby and shall be enforced to the greatest extent permitted by law.
SECTION 9.14. Interest. In no event shall the amount of
interest due or payable hereunder or under the Notes exceed the maximum rate of
interest allowed by applicable law, and in the event any such payment is
inadvertently made to any Bank by the Borrower or inadvertently received by any
Bank, then such excess sum shall be credited as a payment of principal, unless
the Borrower shall notify such Bank in writing that it elects to have such
excess sum returned forthwith. It is the express intent hereof that the Borrower
not pay and the Banks not receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may legally be paid by the Borrower
under applicable law.
SECTION 9.15. Interpretation. No provision of this Agreement
or any of the other Loan Documents shall be construed against or interpreted to
the disadvantage of any party hereto by any court or other governmental or
judicial authority by reason of such party having or being deemed to have
structured or dictated such provision.
SECTION 9.16. Consent to Jurisdiction. The Borrower (a)
submits to personal jurisdiction in the State of Georgia, the courts thereof and
the United States District Courts sitting therein, for the enforcement of this
Agreement, the Notes and the other Loan Documents, (b) waives any and all
personal rights under the law of any jurisdiction to object on any basis
(including, without limitation, inconvenience of forum) to jurisdiction or venue
within the State of Georgia for the purpose of litigation to enforce this
Agreement, the Notes or the other Loan Documents, and (c) agrees that service of
process may be made upon it in the manner prescribed in Section 9.01 for the
giving of Notice to the Borrower. Nothing herein contained, however, shall
prevent the Agent from bringing any action or exercising any rights against any
security and against the Borrower personally, and against any assets of the
Borrower, within any other state or jurisdiction.
SECTION 9.17. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, under seal, by their respective authorized
officers as of the day and year first above written.
KAYDON CORPORATION
By: /s/ (SEAL)
-----------------------------
Title: Chairman
00000 X.X. 00 Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxxx
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
[Remainder of page intentionally left blank]
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COMMITMENTS WACHOVIA BANK OF GEORGIA, N.A., as Agent and as a
Bank
$30,000,000
By: /s/ Xxxxx Xxxxxx (SEAL)
-----------------------------
Title: Vice President
Lending Office
Wachovia Bank of Georgia, N.A.
Syndication Services
000 Xxxxxxxxx Xxxxxx, X.X., Mail Code GA - 0423
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxxxxxx Xxxxxxxx (00xx Xxxxx)
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
with a copy to:
Wachovia Bank of Georgia, N.A.
000 Xxxxxxxxx Xxxxxx, X.X., Mail Code GA - 3940
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx (00xx Xxxxx)
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
[Remainder of page intentionally left blank]
48
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$15,000,000 NATIONSBANK, N.A. (SOUTH)
By: /s/ Xxxxxxx X. Xxxxxxxx (SEAL)
------------------------------
Title: Senior Vice President
Lending Office
NationsBank, N.A. (South)
000 Xxxxx Xxxxxx Xxxxx
0xx Xxxxx
Xxxxx, Xxxxxxx 00000-0000
Attention: Miles Xxxxxxx
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
[Remainder of page intentionally left blank]
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$15,000,000 THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ Xxxxxx X. Price (SEAL)
-----------------------------
Title: As Agent
Lending Office
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Price
Telecopy number: (000) 000-0000
Telephone number:(000) 000-0000
[Remainder of page intentionally left blank]
50
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$15,000,000 KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx X. Xxxxxxxx (SEAL)
-----------------------------
Title: Assistant Vice President
Lending Office
KeyBank National Association
000 Xxxxxx Xxxxxx (Mail Code: 0H-01-27-0606)
Xxxxxxxxx, Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxxxxx, Assistant
Vice President
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
[Remainder of page intentionally left blank]
51
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$15,000,000 SUNTRUST BANK, TAMPA BAY
By: /s/ Xxxxx X. Xxxxxxx (SEAL)
------------------------------
Title: Vice President
Lending Office
SunTrust Bank, Tampa Bay
0000 00xx Xxxxxx Xxxxx
Xx. Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
[Remainder of page intentionally left blank]
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$10,000,000 THE FIRST NATIONAL BANK OF MARYLAND
By: /s/ (SEAL)
-----------------------------
Title: Vice President
Lending Office
The First National Bank of Maryland
National Division, 18th Floor
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx (Mail Code: 101-745)
Telecopy number: (000) 000-0000
Telephone number: (000) 000-0000
------------------
TOTAL COMMITMENTS:
$100,000,000.00
[Remainder of page intentionally left blank]
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SCHEDULE 4.05
Fraudulent Transfer and Products Liability Matters
The following matters singly or in conjunction with any other event or
events, act or acts, condition or conditions, occurrence or occurrences, whether
or not related, do not have a Material Adverse Effect:
A. Sikorsky Helicopter
On May 9, 1996, a Sikorsky H-53E helicopter crashed during a
static test flight, resulting in four fatalities of Sikorsky employees. On June
13, 1996, the Navy grounded all H-53E helicopters, pending re-inspection. The
Borrower manufactured the swashplate bearing used in the helicopter. A "Mishap
Board" led by Sikorsky, without the Borrower's participation, attributed the
accident to the bearing manufactured by the Borrower. The Borrower has not been
given a copy of this report and is currently conducting its own review of the
incident. The Borrower has been informed that attorneys representing two of the
deceased pilots have made contact with the Borrower's insurance company, as well
as with Sikorsky and the U.S. Government, seeking information surrounding the
incident. To date, no litigation has been initiated.
On October 19, 1996, another Sikorsky H-53E helicopter
experienced mechanical problems at New River (North Carolina) Air Station.
Disassembly of the swashplate assembly revealed a severely damaged swashplate
bearing with characteristics similar to the bearing which was inspected as a
result of the May 9 incident. The bearing involved in the October 19 mishap was
determined to have been in full compliance with all standards and specifications
and had been specifically approved by Sikorsky and the U.S. Navy. In addition,
there have been two additional incidents with H-53E helicopters since the
October 19, 1996 incident where bearings that have been manufactured, assembled
and inspected under the new procedures in place and which have been certified by
the Navy and Sikorsky as meeting all applicable specifications and requirements
have experienced unacceptable levels of vibration in the swashplate assembly. It
is therefore, the opinion of Borrower's management that since the bearings
involved in the subsequent incidents were in full compliance with all requisite
specifications and exhibited stress characteristics almost identical to the
characteristics as the bearing involved in the May 9, 1996 incident that the
bearing was not a contributing factor to the May 9, 1996, incident.
The Borrower has received a subpoena dated June 10, 1996,
issued by the U.S. District Court in Bridgeport, Connecticut, on behalf of a
Grand Jury investigating the May 9, 1996 accident in Stratford, Connecticut,
involving the H-53E Sikorsky helicopter which resulted in the four fatalities.
The Grand Jury has requested documents and records relating to a bearing
manufactured by Kaydon and used in the H-53E helicopter, and Kaydon has
responded to the subpoena and intends to cooperate with the subpoena process.
62
Subsequent to the May 9, 1996 incident, the Navy issued an
Order to ground the entire fleet of H-53E helicopters involving approximately
198 aircraft. An intensive program was established involving the U.S. Navy,
Sikorsky and the Borrower to inspect the swashplate assemblies in the grounded
craft and repair or replace components deemed a problem. At this time the
grounded fleet has been reactivated, but approximately five aircraft have been
recently temporarily removed from service after experiencing excessive vibration
in the swashplate assembly and, in one case, a complete failure of the
swashplate assembly (the October 19, 1996 incident at New River).
Potential areas of liability surrounding this entire matter
include:
1. Litigation initiated by the estates of the deceased
pilots involved in the May 9, 1996 incident.
2. Total loss of the H-53E helicopter involved in the
May 9, 1996 incident.
3. Cost associated with the grounding of the H-53E fleet
of helicopters.
4. Potential liability associated with the Grand Jury
investigation involving the May 9, 1996 incident.
The Borrower is cooperating with Sikorsky and the Navy in
investigating circumstances surrounding all of the above incidents. At this
point in time, it is impossible to determine the exact cause of any of the
incidents, however, it is the Borrower's opinion based on all of the facts and
analysis that have been assembled to date that the bearings manufactured by the
Borrower were not the precipitating cause of the failure of the swashplate
assemblies. Since no litigation has been initiated, nor any claim for damages
made by either Sikorsky or the U.S. Navy, it is impossible to quantify whether
any potential liability exists as a result of the May 9, 1996 incident. The
Borrower's aviation product liability insurance will be available to cover the
defense cost, as well as any liability, if any, associated with any litigation
resulting from the four fatalities on May 9, 1996, to the extent of policy
limits. The Borrower believes that it has meritorious defenses to any claim that
may be initiated as a result of the May 9, 1996 incident. Our analysis of the
facts and investigations that have been assembled to date lead us to also
believe that the Borrower would have meritorious defenses to any claims raised
and in addition, it appears highly unlikely that any claim would be raised under
items 2 or 3 above. Since the investigation as to the real cause of the mishaps
is ongoing, the discovery of new facts or the development of new theories of
causation could alter the issue of meritorious defenses.
x. Xxxxx Corporation
The Borrower, together with other companies, certain former
officers, and certain current and former directors, has been named as a
co-defendant in lawsuits filed in federal court in New York in 1993. The suits
purport to be class actions on behalf of all persons who have
2
63
unsatisfied personal injury and property damage claims against Xxxxx Corporation
which filed for bankruptcy under Chapter 11. The premise of the suits is that
assets of Xxxxx were transferred to Bairnco subsidiaries, of which the Borrower
was one in 1983, at less than fair value. The suits also allege that the
Borrower, among other named defendants, was a successor to and alter ego of
Xxxxx. In 1994, an examiner was appointed by a bankruptcy court to examine the
issues at stake. On September 23, 1994, the "Preliminary Report of the Examiner"
was made public. In the report, the examiner stated that the alleged fraudulent
conveyance claims against the Borrower appear to be time-barred by the statute
of limitations, subject to certain possible exceptions which the Borrower does
not believe are significant or factual. Although the examiner has made certain
recommendations regarding a mechanism to resolve the claims against the
Borrower, the Court has not taken any action related to the report.
Nevertheless, in the Borrower's opinion, the report reinforces management's
original view that the claims will ultimately not be sustained. Accordingly, no
provision has been reflected in the consolidated financial statements for any
alleged damages. In June 1995, the creditors' committee filed a complaint in the
same bankruptcy court asserting claims against the Borrower similar to those
previously filed.
On June 12, 1996, the United States District Court for the
Southern District of New York (the "District Court") issued an order confirming
Xxxxx'x plan of reorganization. That order subsequently became final and, on
July 31, 1996, the plan became effective. As a result of the effectiveness of
the plan, (i) the claims asserted in the Adversary proceeding have been
transferred to a creditors' trust established under the plan, and (ii) the
further prosecution of the Xxxxxxx and Xxxxxxx actions has been enjoined. In
addition, following the confirmation of the plan, pursuant to the Stipulation of
Settlement among the Borrower, Xxxxx, the Committee, the Legal Representative
for Future Claimants and certain corporate and individual defendants in the
Adversary Proceeding, the stay of the Adversary Proceeding expired on August 24,
1996.
On October 7, 1996, the Borrower and certain other corporate
defendants in the Adversary Proceeding filed a motion (the "Motion") with the
District Court to withdraw the reference for the Adversary Proceeding. The
plaintiff in the Adversary Proceeding has consented to the relief sought in the
Motion, and the Motion is now fully submitted before the District Court. We are
unable to predict when the District Court will decide this Motion. Pursuant to
orders entered by the Bankruptcy Court on September 12, 1996 and September 30,
1996, the time within which the Borrower is required to answer, move or
otherwise respond to the complaint in the Adversary Proceeding has been extended
until the date that is thirty days after the date on which the District Court
enters an order granting or denying the relief requested in the Motion.
3
64
SCHEDULE 4.08
Existing Subsidiaries
Name of Subsidiary Jurisdiction of Incorporation
------------------ -----------------------------
Kaydon S.A. De C.V. Mexico
Kaydon International, Inc. Virgin Islands
Kaydon Ring & Seal, Inc. Delaware
Kaydee Corporation Maryland
Kaydon Acquisition Corp. IV Delaware
Electro-Tec Corp. Delaware
Industrial Tectonics Inc. Delaware
Kaydon Acquisition Corp. III Delaware
Kaydon Acquisition Corp. U.K. Limited United Kingdom
IDM Electronics Ltd United Kingdom
Prizerandom Limited United Kingdom
Xxxxxx Roller Bearing Company Limited United Kingdom
The Xxxxxx Split Roller Bearing Corp. Xxxxxxxx
Xxxxxx Split Roller Bearing Company Ltd. Canada
Xxxxxx Getellte Rollenlager GmbH Germany
Xxxxxx Power Transmission Ltd. Germany
Kaydon Acquisition Corp. V Delaware
Kaydon Acquisition VII, Inc. Delaware
Kaydon Acquisition VIII, Inc. Delaware
65
SCHEDULE 5.19
Existing Debt
The Economic Development Corporation of the City of Sumter Variable
Rate Demand Industrial Development Refunding Revenue Bonds (Sumter IRB) in face
amount of $4,000,000 with a maturity date of April 1, 1997, which IRB is
collateralized with a Letter of Credit issued by NBD Bank, N.A. of Detroit,
Michigan in the amount of $4,350,000 which represents the principal amount of
the IRB plus up to 210 days' estimated interest.
The Economic Development Corporation of the City of Norton Shores
Variable Rate Demand Industrial Development Refunding Revenue Bonds (Norton
Shores IRB) in face amount of $4,000,000 with a maturity date of August 1, 1999,
which IRB is collateralized with a Letter of Credit issued by NBD Bank, N.A. of
Detroit, Michigan in the amount of $4,350,000 which represents the principal
amount of the IRB plus up to 210 days estimated interest.
66
EXHIBIT A
NOTE
$____________ Atlanta, Georgia
February __, 1997
For value received, KAYDON CORPORATION, a ________
corporation (the "Borrower"), promises to pay to the order of (the "Bank"),
for the account of its Lending Office, the principal sum of ________________
______________________________ and No/100 Dollars ($____________), or such
lesser amount as shall equal the unpaid principal amount of each Loan made by
the Bank to the Borrower pursuant to the Credit Agreement referred to below, on
the dates and in the amounts provided in the Credit Agreement. The Borrower
promises to pay interest on the unpaid principal amount of this Note on the
dates and at the rate or rates provided for in the Credit Agreement. Interest
on any overdue principal of and, to the extent permitted by law, overdue
interest on the principal amount hereof shall bear interest at the Default
Rate, as provided for in the Credit Agreement. All such payments of principal
and interest shall be made in lawful money of the United States in federal or
other immediately available funds at the office of Wachovia Bank of Georgia,
N.A., 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, or such other address
as may be specified from time to time pursuant to the Credit Agreement.
All Loans made by the Bank, the respective maturities thereof,
the interest rates from time to time applicable thereto and all repayments of
the principal thereof shall be recorded by the Bank and, prior to any transfer
hereof, endorsed by the Bank on the schedule attached hereto, or on a
continuation of such schedule attached to and made a part hereof; provided that
the failure of the Bank to make, or any error of the Bank in making, any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This Note is one of the Notes referred to in the Credit
Agreement dated as of February __, 1997, among the Borrower, the banks listed on
the signature pages thereof and their successors and assigns and Wachovia Bank
of Georgia, N.A., as Agent and as a Bank (as the same may be amended or modified
from time to time, the "Credit Agreement"). Terms defined in the Credit
Agreement are used herein with the same meanings. Reference is made to the
Credit Agreement for provisions for the prepayment and the repayment hereof and
the acceleration of the maturity hereof.
The Borrower hereby waives presentment, demand, protest,
notice of demand, protest and nonpayment and any other notice required by law
relative hereto, except to the extent as otherwise may be expressly provided for
in the Credit Agreement.
The Borrower agrees, in the event that this note or any
portion hereof is collected by law or through an attorney at law, to pay all
reasonable costs of collection, including, without limitation, reasonable
attorneys' fees.
67
IN WITNESS WHEREOF, the Borrower has caused this Note to be
duly executed under seal, by its duly authorized officer as of the day and year
first above written.
KAYDON CORPORATION
By:
-----------------------------
Title:
2
68
Note (cont'd)
LOANS AND PAYMENTS OF PRINCIPAL
----------------------------------------------------------------------------------------------------
Type Amount Amount of
of Interest of Principal Maturity Notation
Date Loan(1) Rate Loan Repaid Date Made By
---- ----- --------- ------- --------- -------- --------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
----------------------------------------------------------------------------------------------------
---------------------------
(1) I.e., a Base Rate or Euro-Dollar Loan.
3
69
EXHIBIT B-1
OPINION OF
COUNSEL FOR THE BORROWER
February 28, 1997
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank of Georgia, N.A.,
as Agent
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Re: Credit Agreement dated as of February 28, 1997, among the
Borrower, the Banks listed on the signature pages thereof and
Wachovia Bank of Georgia, N.A., as Agent and as a Bank
Dear Sirs:
We have acted as counsel for KAYDON CORPORATION, a Delaware
corporation (the "Borrower") in connection with the Credit Agreement (the
"Credit Agreement") dated as of February 28, 1997, among the Borrower, the banks
listed on the signature pages thereof and Wachovia Bank of Georgia, N.A., as
Agent and as a Bank. Terms defined in the Credit Agreement are used herein as
therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion. We have assumed for purposes of our opinions set
forth below that the execution and delivery of the Credit Agreement by each Bank
and by the Agent have been duly authorized by each Bank and by the Agent. As to
questions of fact relating to the Borrower material to such opinions, we have
relied upon representations of appropriate officers of the Borrower.
This opinion letter is governed by, and shall be interpreted in
accordance with, the Legal Opinion Accord of the ABA Section of Business Law
(1991) (the "Accord"). As a consequence, it is subject to a number of
qualifications, exceptions, definitions, limitations on coverage, and other
limitations, all as more particularly described in the Accord, and this opinion
letter should be read in conjunction therewith.
70
Upon the basis of the foregoing, we are of the opinion that:
1. The Borrower is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of Delaware and has
all corporate powers required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower of the
Credit Agreement and the Notes (i) are within the Borrower's corporate powers,
(ii) have been duly authorized by all necessary corporate action, (iii) require
no action by or in respect of, or filing with, any governmental body, agency or
official, (iv) do not contravene, or constitute a default under, any provision
of applicable law or regulation or of the certificate of incorporation or
by-laws of the Borrower or of any agreement, judgment, injunction, order, decree
or other instrument which to our knowledge is binding upon the Borrower and (v)
to our knowledge, except as provided in the Credit Agreement, do not result in
the creation or imposition of any Lien on any asset of the Borrower or any of
its Subsidiaries.
3. The Credit Agreement constitutes a valid and binding agreement
of the Borrower, enforceable against the Borrower in accordance with its terms,
and the Notes constitute valid and binding obligations of the Borrower,
enforceable in accordance with their respective terms, except (i) the
enforceability thereof may be affected by bankruptcy, insolvency,
reorganization, fraudulent conveyance, voidable preference, moratorium or
similar laws applicable to creditors' rights or the collection of debtors'
obligations generally; (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability; and (iii) the enforceability of certain of the remedial, waiver
and other provisions of the Credit Agreement and the Notes may be further
limited by the laws of the State of Georgia; provided, however such additional
laws do not, in our opinion, substantially interfere with the practical
realization of the benefits expressed in the Credit Agreement and the Notes,
except for the economic consequences of any procedural delay which may result
from such laws.
4. To our knowledge, there is no action, suit or proceeding
pending, or threatened, against or affecting the Borrower or any of its
Subsidiaries before any court or arbitrator or any governmental body, agency or
official in which there is a reasonable possibility of an adverse decision which
in any manner questions the validity or enforceability of the Credit Agreement
or any Note or except as provided in Schedule 4.05 of the Credit Agreement,
which could materially adversely affect the business, consolidated financial
position or consolidated results of operations of the Borrower and its
Consolidated Subsidiaries, considered as a whole.
5. Each of the Borrower's Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all corporate powers and all material
governmental licenses, authorizations, consents and approvals required to carry
on its business as now conducted.
6. Neither the Borrower nor any of its Subsidiaries is an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
2
71
7. Neither the Borrower nor any of its Subsidiaries is a "holding
company", or a "subsidiary company" of a "holding company", or an "affiliate" of
a "holding company" or of a "subsidiary company" of a "holding company", as such
terms are defined in the Public Utility Holding Company Act of 1935, as amended.
We are licensed to practice only in the State of Michigan. Our
opinions are limited to matters involving the laws of the State of Michigan, the
federal laws of the United States of America and the laws of the State of
Delaware to the extent provided in Section 10(c) of the Accord.
We express no opinion as to the laws of any jurisdiction wherein
any Bank may be located which limits rates of interest which may be charged or
collected by such Bank other than in paragraph 3 with respect to the State of
Michigan.
This opinion is delivered to you in connection with the
transaction referenced above and may only be relied upon by you or any Assignee,
Participant or other Transferee under the Credit Agreement, without our prior
written consent.
Very truly yours,
3
72
EXHIBIT C
OPINION OF
WOMBLE, CARLYLE, XXXXXXXXX & XXXX, PLLC
SPECIAL COUNSEL FOR THE AGENT
[Date as provided in Section 3.01 of the Credit Agreement]
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank of Georgia, N.A.,
as Agent
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Dear Sirs:
We have participated in the preparation of the Credit Agreement
(the "Credit Agreement") dated as of February __, 1997, among KAYDON
CORPORATION, a Delaware corporation (the "Borrower"), the banks listed on the
signature pages thereof (the "Banks") and Wachovia Bank of Georgia, N.A., as
Agent and as a Bank (the "Agent"), and have acted as special counsel for the
Agent for the purpose of rendering this opinion pursuant to Section 3.01(d) of
the Credit Agreement. Terms defined in the Credit Agreement are used herein as
therein defined.
This opinion letter is limited by, and is in accordance with, the
January 1, 1992 edition of the Interpretive Standards applicable to Legal
Opinions to Third Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the Corporate and Banking Law Section of the State Bar of Georgia
which Interpretive Standards are incorporated herein by this reference.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records,
certificates of public officials and other instruments and have conducted such
other investigations of fact and law as we have deemed necessary or advisable
for purposes of this opinion.
Upon the basis of the foregoing, and assuming the due
authorization, execution and delivery of the Credit Agreement and each of the
Notes by or on behalf of the Borrower, we are of the opinion that the Credit
Agreement constitutes a valid and binding agreement of the Borrower and each
Note constitutes valid and binding obligations of the Borrower, in each case
enforceable in accordance with its terms except as: (i) the enforceability
thereof may be affected by bankruptcy, insolvency, reorganization, fraudulent
conveyance, voidable preference, moratorium or similar laws applicable to
creditors' rights or the collection of debtors' obligations generally; (ii)
rights of
73
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability; and (iii) the enforceability of
certain of the remedial, waiver and other provisions of the Credit Agreement and
the Notes may be further limited by the laws of the State of Georgia; provided,
however, such additional laws do not, in our opinion, substantially interfere
with the practical realization of the benefits expressed in the Credit Agreement
and the Notes, except for the economic consequences of any procedural delay
which may result from such laws.
In giving the foregoing opinion, we express no opinion as to the
effect (if any) of any law of any jurisdiction except the State of Georgia. We
express no opinion as to the effect of the compliance or noncompliance of the
Agent or any of the Banks with any state or federal laws or regulations
applicable to the Agent or any of the Banks by reason of the legal or regulatory
status or the nature of the business of the Agent or any of the Banks.
This opinion is delivered to you in connection with the
transaction referenced above and may only be relied upon by you and any
Assignee, Participant or other Transferee under the Credit Agreement without our
prior written consent.
Very truly yours,
WOMBLE, CARLYLE, XXXXXXXXX & RICE, PLLC
By:
-------------------------------------
2
74
EXHIBIT D
CLOSING CERTIFICATE
OF
KAYDON CORPORATION
Reference is made to the Credit Agreement (the "Credit Agreement")
dated as of February __, 1997, among KAYDON CORPORATION (the "Borrower"),
Wachovia Bank of Georgia, N.A., as Agent and as a Bank, and certain other Banks
listed on the signature pages thereof. Capitalized terms used herein have the
meanings ascribed thereto in the Credit Agreement.
Pursuant to Section 3.01(e) of the Credit Agreement,
___________________, the duly authorized ____________________ of the Borrower,
hereby certifies to the Agent and the Banks that: (i) no Default has occurred
and is continuing on the date hereof; and (ii) the representations and
warranties of the Borrower contained in Article IV of the Credit Agreement are
true on and as of the date hereof.
Certified as of the ___ day of February, 1997.
KAYDON CORPORATION
-------------------------------
Name:
Title:
75
EXHIBIT E
KAYDON CORPORATION
SECRETARY'S CERTIFICATE
The undersigned, _____________, _______ Secretary of KAYDON
CORPORATION, a Delaware corporation (the "Borrower"), hereby certifies that he
has been duly elected, qualified and is acting in such capacity and that, as
such, he is familiar with the facts herein certified and is duly authorized to
certify the same, and hereby further certifies, in connection with the Credit
Agreement dated as of February __, 1997, among the Borrower, Wachovia Bank of
Georgia, N.A., as Agent and as a Bank, and certain other Banks listed on the
signature pages thereof that:
1. Attached hereto as Exhibit A is a complete and correct copy of
the Certificate of Incorporation of the Borrower as in full force and effect on
the date hereof as certified by the Secretary of State of the State of Delaware,
the Borrower's state of incorporation.
2. Attached hereto as Exhibit B is a complete and correct copy of
the Bylaws of the Borrower as in full force and effect on the date hereof.
3. Attached hereto as Exhibit C is a complete and correct copy of
the resolutions duly adopted by the Board of Directors of the Borrower on
___________ __, 19__ approving, and authorizing the execution and delivery of,
the Credit Agreement, the Notes (as such term is defined in the Credit
Agreement) and the other Loan Documents (as such term is defined in the Credit
Agreement) to which the Borrower is a party. Such resolutions have not been
repealed or amended and are in full force and effect, and no other resolutions
or consents have been adopted by the Board of Directors of the Borrower in
connection therewith.
4. The officers whose names appear below have been duly elected to
and now hold the offices in the Borrower set forth opposite their respective
names and that the signature appearing opposite the name of each of such officer
is authentic and official:
NAME TITLE SAMPLE SIGNATURE
Xxxxxxxx X. Xxxxxx Chairman _________________
__________________ Secretary _________________
IN WITNESS WHEREOF, the undersigned has hereunto set his hand as
of the ____ day of February __, 1997.
--------------------------------
Name:
Title:
76
EXHIBIT F
FORM OF COMPLIANCE CERTIFICATE
Reference is made to the Credit Agreement dated as of February __,
1997 (as modified and supplemented and in effect from time to time, the "Credit
Agreement") among Kaydon Corporation, the Banks from time to time parties
thereto and Wachovia Bank of Georgia, N.A., as Agent and as a Bank. Capitalized
terms used herein shall have the meanings ascribed thereto in the Credit
Agreement.
Pursuant to Section 5.01(c) of the Credit Agreement,
_________________, the duly authorized ___________________, of Kaydon
Corporation, hereby certifies to the Agent and the Banks that the information
contained in the Compliance Check List attached hereto is true, accurate and
complete as of _____________, 199___ (the "Compliance Date"), and that no
Default is in existence on and as of the date hereof.
Dated as of _________________.
KAYDON CORPORATION
By:
-----------------------------
Name:
Title:
77
COMPLIANCE CHECK LIST
KAYDON CORPORATION
_________________, 199__
1. Ratio of Consolidated Total Debt to Total Capitalization (Section 5.03)
(a) Consolidated Total Debt $
-------------
(b) Total Capitalization
(i) Stockholders' Equity (shareholder's equity $
excluding any Redeemable Preferred Stock) -------------
(ii) Consolidated Total Debt (same as (a)
above, minus): $
-------------
a. all obligations (absolute or
contingent) to reimburse any
bank or other person in respect
of amounts paid under a letter
of credit with an expiration date
of more than one year $
-------------
b. all debt of others secured by a lien on
any asset of Borrower $
-------------
c. all debt of others guaranteed by Borrower $
-------------
Total for (ii) $
-------------
Sum of (i) and (ii) (Total for (b)) $
-------------
Actual Ratio of (a) to (b)
-------------
Must Be Less Than 0.55 to 1.00
78
2. Interest Coverage Ratio (Section 5.04)
(a) EBIT
(i) Consolidated Net Income (Net income, excluding
extraordinary items and equity interests of the
Borrower or any Subsidiary in the unremitted
earnings of any Person that is not a Subsidiary) $
-------------
(ii) Taxes on Income; and $
-------------
(iii) Consolidated Interest Expense (interest, whether
expensed or capitalized, in respect of Debt of
the Borrower or any of its Consolidated
Subsidiaries outstanding during such period $
-------------
Total EBIT (sum of i, ii and iii above) $
-------------
(b) Consolidated Interest Expense (same as iii above) $
-------------
Actual Ratio of (a) to (b) -------------
Must Be Greater Than 2.50 to 1.00
3. Loans or Advances (Section 5.05)
(a) Amount of Loans or Advances to Employees $
-------------
(b) Must Not Exceed $1,000,000.00
4. Negative Pledge (Section 5.07)
(a) Total Debt secured by Liens not permitted by
Sections 5.07(a) through (i) $
-------------
(b) Must Not Exceed -5% of Consolidated Net Worth $
-------------
5. Limitation on Sales of Assets (Section 5.10)
(a) Aggregate Assets transferred or utilized in discontinued
business line or segment, for current Fiscal Quarter and
immediately preceding seven Fiscal Quarters $
-------------
2
79
Limitation:
Such assets must be or contribute less than either:
(i) 5% of Consolidated Total Assets, at the
end of the eighth Fiscal Quarter immediately
preceding such Fiscal Quarter $
or --------------
(ii) 5% of Consolidated Operating Profits
during the 8 consecutive Fiscal Quarters
immediately preceding such Fiscal Quarter $
-------------
6. Debt (Section 5.19)
(a) Debt of Subsidiaries of the Borrower owing to the
Borrower or another Subsidiary of the Borrower $
-------------
(b) Debt of Subsidiaries of the Borrower outstanding
on the date of the Credit Agreement described on
Schedule 5.19 of the Credit Agreement $
-------------
(c) Debt of Subsidiaries of the Borrower incurred or assumed for
the purpose of financing all or any part of the cost of
acquiring or constructing an asset of such Subsidiary and
secured by a Lien permitted under Section 5.07(c) of the Credit
Agreement $
-------------
(d) Debt of Subsidiaries of the Borrower secured by a Lien
in an aggregate principal amount not exceeding 5%
of Consolidated Net Worth $
-------------
(e) Debt of Subsidiaries of the Borrower, in addition to Debt
described in (a), (b), (c) and (d) not to exceed 5%
of Consolidated Net Worth $
-------------
(f) Total of (b), (c), (d) and (e) above $
-------------
Must Not Exceed 20% of Consolidated Net Worth $
-------------
3
80
EXHIBIT G
ASSIGNMENT AND ACCEPTANCE
Dated ________________ __, ____
Reference is made to the Credit Agreement dated as of February
__, 1997 (together with all amendments and modifications thereto, the "Credit
Agreement") among KAYDON CORPORATION, a Delaware corporation (the "Borrower"),
the Banks (as defined in the Credit Agreement) and Wachovia Bank of Georgia,
N.A., as Agent (the "Agent"). Terms defined in the Credit Agreement are used
herein with the same meaning.
_____________________________________________________ (the
"Assignor") and _____________________________________________ (the "Assignee")
agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
without recourse to the Assignor, and the Assignee hereby purchases and assumes
from the Assignor, a ______% interest in and to all of the Assignor's rights and
obligations under the Credit Agreement as of the Effective Date (as defined
below) (including, without limitation, a ______% interest (which on the
Effective Date hereof is $_______________) in the Assignor's Commitment and a
______% interest (which on the Effective Date hereof is $_______________) in the
Loans owing to the Assignor and a ______% interest in the Note held by the
Assignor (which on the Effective Date hereof is $__________________)).
2. The Assignor (i) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement, any other
instrument or document furnished pursuant thereto or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the Credit
Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto, other than that it is the legal and beneficial owner of the
interest being assigned by it hereunder, that such interest is free and clear of
any adverse claim and that as of the date hereof its Commitment (without giving
effect to assignments thereof which have not yet become effective) is
$_________________ and the aggregate outstanding principal amount of Loans owing
to it (without giving effect to assignments thereof which have not yet become
effective) is $_________________; (ii) makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower or the performance or observance by the Borrower of any of its
obligations under the Credit Agreement, any other Loan Document or any other
instrument or document furnished pursuant thereto; and (iii) attaches the
Note[s] referred to in paragraph 1 above and requests that the Agent exchange
such Note[s] as follows: [a new Note dated _______________, ____ in the
principal amount of _________________ payable to the order of the Assignee] [new
Notes as follows: a Note dated _________________, ____ in the principal amount
of $_______________ payable to the order of the Assignor and a Note dated
______________, ____ in the principal amount of $______________ payable to the
order of the Assignee].
81
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements referred
to in Section 4.04(a) thereof (or any more recent financial statements of the
Borrower delivered pursuant to Section 5.01(a) or (b) thereof) and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into this Assignment and Acceptance; (ii) agrees
that it will, independently and without reliance upon the Agent, the Assignor or
any other Bank 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 Credit Agreement; (iii) confirms that it is a bank
or financial institution; (iv) appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under the Credit
Agreement as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will perform in
accordance with their terms all of the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Bank; (vi) specifies as
its Lending Office (and address for Notices) the office set forth beneath its
name on the signature pages hereof, (vii) represents and warrants that the
execution, delivery and performance of this Assignment and Acceptance are within
its corporate powers and have been duly authorized by all necessary corporate
action[, and (viii) attaches the forms prescribed by the Internal Revenue
Service of the United States certifying as to the Assignee's status for purposes
of determining exemption from United States withholding taxes with respect to
all payments to be made to the Assignee under the Credit Agreement and the Notes
or such other documents as are necessary to indicate that all such payments are
subject to such taxes at a rate reduced by an applicable tax treaty].(2)
4. The Effective Date for this Assignment and Acceptance shall
be _______________ (the "Effective Date"). Following the execution of this
Assignment and Acceptance, it will be delivered to the Agent for execution and
acceptance by the Agent [and to the Borrower for execution by the Borrower](3).
5. Upon such execution and acceptance by the Agent [and
execution by the Borrower]**, from and after the Effective Date, (i) the
Assignee shall be a party to the Credit Agreement and, to the extent rights and
obligations have been transferred to it by this Assignment and Acceptance, have
the rights and obligations of a Bank thereunder and (ii) the Assignor shall, to
the extent its rights and obligations have been transferred to the Assignee by
this Assignment and Acceptance, relinquish its rights (other than under Section
8.03 and Section 9.03 of the Credit Agreement) and be released from its
obligations under the Credit Agreement.
6. Upon such execution and acceptance by the Agent [and
execution by the Borrower]**, from and after the Effective Date, the Agent shall
make all payments in respect of the interest assigned hereby to the Assignee.
The Assignor and Assignee shall make all appropriate
------------------
(2) If the Assignee is organized under the laws of a jurisdiction outside
the United States.
(3) If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date or if a Default is not in existence on the Effective Date.
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adjustments in payments for periods prior to such acceptance by the Agent
directly between themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Georgia.
[NAME OF ASSIGNOR]
By:
---------------------------------------
Title:
[NAME OF ASSIGNEE]
By:
---------------------------------------
Title:
Lending Office:
[Address]
WACHOVIA BANK OF GEORGIA, N.A., as Agent
By:
---------------------------------------
Title:
KAYDON CORPORATION(1)
By:
---------------------------------------
Title:
------------------
(1) If the Assignee is not a Bank or an Affiliate of a Bank prior to the
Effective Date or if a Default is not in existence on the Effective Date.
3
83
EXHIBIT H
NOTICE OF BORROWING
February __, 1997
Wachovia Bank of Georgia, N.A., as Agent
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Re: Credit Agreement (as amended and modified from time
to time, the "Credit Agreement") dated as of February
__, 1997, by and among Kaydon Corporation, the Banks
from time to time parties thereto, and Wachovia Bank
of Georgia, N.A., as Agent and as a Bank.
Gentlemen:
Unless otherwise defined herein, capitalized terms used herein
shall have the meanings attributable thereto in the Credit Agreement.
This Notice of Borrowing is delivered to you pursuant to
Section 2.02 of the Credit Agreement.
The Borrower hereby requests a [Euro-Dollar Borrowing] [Base
Rate Borrowing] in the aggregate principal amount of $___________ to be made on
________, 19__, and for interest to accrue thereon at the rate established by
the Credit Agreement for [Euro-Dollar Loans] [Base Rate Loans]. The duration of
the Interest Period with respect thereto shall be [1 month] [2 months] [3
months] [6 months] [30 days].
The Indicative Rate, if any, applicable to the Borrowing
described above is _____________.
The Borrower has caused this Notice of Borrowing to be
executed and delivered by its duly authorized officer this ___ day of ____,
199_.
KAYDON CORPORATION
By:
------------------------------
Name:
----------------------------
Title:
---------------------------
84
Subject to the terms of the Credit Agreement, the interest
rate applicable to the Borrowing described above is _________.
Date:
WACHOVIA BANK OF GEORGIA, N.A., as Agent
By:
------------------------------
Name:
-----------------------------
Title:
----------------------------
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