EXHIBIT 4(a)(vii)
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ONEIDA LTD.
2001 AMENDED AND RESTATED
NOTE PURCHASE AGREEMENT
Dated as of May 1, 2001
$30,000,000 Principal Amount
Senior Secured Notes
Due January 15, 2002
PPN: 682505 C* 1
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TABLE OF CONTENTS
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1. DESCRIPTION OF NOTES AND COMMITMENT............................................1
1.1. Amendment and Restatement of Agreement................................1
1.2. Description of Notes..................................................1
1.3. Subsidiary Guarantee and Security Documents...........................3
1.4. Company's Commitment; Closing Date....................................3
2. PREPAYMENT OF NOTES............................................................3
2.1. Required Prepayments..................................................3
2.2. Optional Prepayments..................................................4
2.3. Notice of Prepayments.................................................5
2.4. Surrender of Notes on Prepayment or Exchange..........................5
2.5. Direct Payment........................................................5
2.6. Allocation of Payments................................................6
2.7. Payments Due on Saturdays, Sundays and Holidays.......................6
3. REPRESENTATIONS................................................................6
3.1. Representations of the Company........................................6
3.2. Representations of the Purchasers....................................12
4. CLOSING CONDITIONS............................................................13
4.1. Representations and Warranties.......................................13
4.2. Legal Opinions.......................................................13
4.3. Events of Default....................................................14
4.4. Payment of Fees and Expenses.........................................14
4.5. Legality of Investment...............................................14
4.6. Private Placement Number.............................................14
4.7. Issue of All Notes...................................................14
4.8. Proceedings and Documents............................................14
4.9. Amendment Fee........................................................15
4.10. Credit Agreement.....................................................15
4.11. Exchange of Notes....................................................15
5. INTERPRETATION OF AGREEMENT...................................................15
5.1. Certain Terms Defined................................................15
5.2. Accounting Principles................................................28
5.3. Valuation Principles.................................................28
5.4. Direct or Indirect Actions...........................................28
5.5. Property.............................................................28
5.6. Officers.............................................................28
6. AFFIRMATIVE COVENANTS.........................................................28
6.1. Financial and Business Information and Reports.......................29
6.2. ERISA................................................................32
6.3. Corporate Existence..................................................33
6.4. Payment of Obligations...............................................33
6.5. Maintenance of Properties............................................33
6.6. Insurance............................................................33
6.7. Maintenance of Records...............................................34
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6.8. Inspection of Properties and Records; Confidentiality................34
6.9. Compliance with Laws.................................................35
6.10. Subsidiary Guarantees and Collateral.................................35
6.11. Maintenance of Liens of the Security Documents.......................35
6.12. Taxes, Claims for Labor and Materials................................36
6.13. Acquisition of Notes.................................................36
6.14. Private Placement Number.............................................36
6.15. NAIC Filings.........................................................36
6.16. THC Systems, Inc. Voting Stock.......................................37
6.17. Most Favored Nation..................................................37
7. NEGATIVE COVENANTS............................................................37
7.1. Indebtedness.........................................................37
7.2. Liens................................................................38
7.3. Merger or Consolidation..............................................40
7.4. Liquidate or Dissolve Subsidiaries; Sale of Assets...................41
7.5. Investments, Loans, Advances, Guaranties and Acquisitions............41
7.6. Hedging Agreements...................................................42
7.7. Transactions with Affiliates.........................................42
7.8. Restrictive Agreements...............................................43
7.9. Fiscal Year, Accounting Policies and Consolidated Tax Returns........43
7.10. Subordinated Debt....................................................43
7.11. Negative Pledges.....................................................43
7.12. Financial Covenants..................................................44
7.13. Letters of Credit....................................................44
7.14. Deposit Accounts.....................................................44
7.15. Prepayment of Indebtedness...........................................45
7.16. Long-Term Leases.....................................................45
7.17. Change in Business...................................................45
7.18. Pari Passu Position..................................................45
7.19. Collateral Agency Agreement..........................................45
7.20. Change in Commitment.................................................46
7.21. Change in Level......................................................46
8. EVENTS OF DEFAULT AND REMEDIES THEREFOR.......................................46
8.1. Nature of Events.....................................................46
8.2. Remedies on Default..................................................48
8.3. Annulment of Acceleration of Notes...................................49
8.4. Other Remedies.......................................................49
8.5. Conduct No Waiver; Collection Expenses...............................50
8.6. Remedies Cumulative..................................................50
8.7. Notice of Default....................................................50
9. AMENDMENTS, WAIVERS AND CONSENTS..............................................50
9.1. Matters Subject to Modification......................................50
9.2. Solicitation of Holders of Notes.....................................51
9.3. Binding Effect.......................................................52
10. FORM OF NOTES, REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT...............52
10.1. Form of Notes........................................................52
10.2. Note Register........................................................52
10.3. Issuance of New Notes upon Exchange or Transfer......................52
10.4. Replacement of Notes.................................................53
11. MISCELLANEOUS.................................................................53
11.1. Expenses.............................................................53
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11.2. Notices..............................................................54
11.3. Reproduction of Documents............................................54
11.4. Successors and Assigns...............................................54
11.5. Law Governing........................................................54
11.6. Headings.............................................................55
11.7. Counterparts.........................................................55
11.8. Reliance on and Survival of Provisions...............................55
11.9. Integration and Severability.........................................55
Schedule I Principal Amount of Notes to be Purchased
Schedule 6.01(a) -- Borrowed Money
Schedule 6.01(b) -- Guarantees
Schedule 6.01(c) -- Capital Leases
Annex I -- Subsidiary Guarantors of the Company and Jurisdictions
where each Subsidiary Guarantor is Qualified to do Business
as a Foreign Corporation
Annex II -- Existing Indebtedness
Annex III -- Description of Liens
Annex IV -- Schedule of Insurance
Annex V -- Restrictions
Exhibit A -- Form of Senior Secured Note due January 15, 2002
Exhibit B -- Form of Legal Opinion
Exhibit C -- Form of Security Agreement
Exhibit D -- Form of Amended and Restated Subsidiary
Subordination Agreement
Exhibit E -- Form of Amended and Restated Subsidiary
Guarantee Agreement
Exhibit F -- Form of Pledge Agreement
ONEIDA LTD.
2001 AMENDED AND RESTATED
NOTE PURCHASE AGREEMENT
Dated as of May 1, 2001
To the Purchasers Named
in Schedule I Hereto
Ladies and Gentlemen:
ONEIDA LTD., a New York corporation (the "Company"), agrees with you as follows:
1. DESCRIPTION OF NOTES AND COMMITMENT
1.1. Amendment and Restatement of Agreement.
This 2001 Amended and Restated Note Purchase Agreement (as the same may from
time to time be amended, restated, modified or supplemented, the "Agreement")
amends and restates in its entirety and is delivered in substitution for and
replacement of the Amended and Restated Note Agreement dated as of January 1,
1992 (as the same may from time to time be amended, supplemented, restated or
modified, the "Original Agreement") and the notes issued thereunder among the
Company and the Purchasers named therein pursuant to which $30,000,000 aggregate
principal amount of the Company's 8.52% Senior Notes due January 15, 2002 (the
"Original 1992 Senior Notes") were issued and presently are outstanding. This
Agreement shall not constitute a novation of the Original Agreement or all or
any portion of the indebtedness evidenced thereby. References herein to a
"Schedule", an "Annex" or an "Exhibit" are, unless otherwise specified, to a
Schedule, an Annex or an Exhibit attached to this Agreement.
1.2 Description of Notes.
In substitution for and replacement of the Original 1992 Senior Notes, the
Company has authorized the issue of $30,000,000 aggregate principal amount of
its Senior Secured Notes due January 15, 2002 (the "Notes", such term to include
any such notes issued in substitution therefor pursuant to Section 10 of this
Agreement). The Notes shall be substantially in the forms set out in Exhibit A,
with such changes therefrom, if any, as may be approved by each of the
Purchasers named therein and the Company.
The Notes shall bear interest from such date of issuance at the rate of:
(i) 8.52% per annum commencing July 15, 1992 up to and including
September 11, 2000;
(ii) 9.02% per annum commencing September 12, 2000 up to and including
December 13, 2000;
(iii) 9.52% per annum commencing December 14, 2000 up to and including
April 27, 2001;
(iv) 9.87% per annum from April 28, 2001 until the earlier of:
(a) the date or dates, as the case may be, of any increase in the
Level in which case the rate of interest will increase on such date to
an amount equal to the sum of the then existing interest rate plus the
amount of such increase in the Level; or
(b) the date or dates, as the case may be, of a decrease in the Level
in which case the rate of
interest will decrease on such date to an amount equal to the then
existing interest rate minus the amount of such decrease in the Level,
provided that (i) in no event shall the interest rate fall below 8.52%
and (ii) the Company provides evidence to the Purchasers satisfactory
to the Purchasers that: (1) the Lenders have not received further
compensation in any form as a result of any such reduction in the
Level, (2) the Consolidated Leverage Ratio is, as of the last day of
the immediately preceding Fiscal Quarter, in compliance with Section
7.12 and (3) no Event of Default exists, or
(c) maturity; and
(v) Notwithstanding the foregoing, if the amount of capital required to be
maintained by the Noteholders in respect of the Notes is increased as a result
of a Change in Capital (as defined below), the interest rate then in effect on
the Notes shall be increased by 0.50% (50 basis points) effective as of the date
on which such increase in required capital is effective. The Noteholders agree
to notify the Company of such increase and the date on which such increase
becomes effective, promptly after learning of such increase in required capital.
As used herein, "Change in Capital" means any change after the date of this
Agreement that increases the risk-based capital factor attributable to the Notes
as mandated by the risk-based capital guidelines for life and health insurance
companies in effect in the United States on the date of this Agreement.
All such interest payments shall be payable quarterly on the fifteenth (15th)
day of each January, April, July and October, and at maturity, and shall bear
interest on overdue principal (including any overdue required or optional
prepayment), premium, if any, and (to the extent legally enforceable) on any
overdue installment of interest at the greater of (a) the rate of interest
publicly announced by The Chase Manhattan Bank (or its successors or assigns) as
its "prime rate" plus one percent (1%) or (b) the sum of the rate of interest
then in effect plus two percent (2%) per annum, after maturity of the due date
thereof, whether by acceleration or otherwise, until paid, to be expressed to
mature on January 15, 2002. The term "Notes" as used herein shall include each
Note delivered pursuant to this Agreement and each Note delivered in
substitution or exchange therefor and, where applicable, shall include the
singular number as well as the plural. Any reference to you in this Agreement
shall in all instances be deemed to include any nominee of yours or any separate
account or other person on whose behalf you are purchasing Notes. You are
sometimes referred to herein as a "Purchaser" and, together with the other
Purchaser, as the "Purchasers."
1.3 Subsidiary Guarantee and Security Documents.
The Notes will be guaranteed by each Subsidiary Guarantor pursuant to a
Subsidiary Guarantee. The Notes will be secured, pari passu, with all other
Senior Secured Indebtedness, pursuant to the Security Documents. In connection
with the Subsidiary Guarantees and the Security Documents, the Lenders, the
Noteholders and certain other lenders have entered into the Collateral Agency
Agreement.
1.4 Company's Commitment; Closing Date.
Subject to the terms and conditions hereof and on the basis of the
representations and warranties hereinafter set forth, the Company has issued and
sold to you, and you have purchased from the Company, Original Notes in the
aggregate principal amount set forth opposite your name in the attached Schedule
I at a price of 100% of the principal amount thereof.
Delivery of the Notes issued pursuant to this Agreement and any and all
documents required pursuant to Section 4 hereof shall be made at the offices of
Xxxxxxx, Carton & Xxxxxxx, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxx,
Xxxxxxxx 00000, at 9:00 a.m., Chicago Time, on May 31, 2001, or at such later
time or on such later date as may be mutually agreed upon by the Company and the
Purchasers (the "Closing Date"). The Notes will be delivered to you in fully
registered form, issued in your name or in the name of your nominee.
2. PREPAYMENT OF NOTES
2.1 Required Prepayments.
(a) In addition to payment of all outstanding principal of the Notes at
maturity and regardless of the amount of Notes which may be outstanding from
time to time, the Company shall prepay and there shall become due and payable on
January 15 in each year, $4,285,714.29 of the principal amount of the Notes or
such lesser amount as would constitute payment in full on the Notes, commencing
January 15, 1996 and ending January 15, 2001 inclusive, with the remaining
principal payable on January 15, 2002. Notwithstanding the foregoing, a Pro Rata
Amount of the Notes shall mature and become immediately due and payable on the
date of an occurrence of a Bank Event. Each such prepayment shall be at a price
of 100% of the principal amount prepaid, together with interest accrued thereon
to the date of prepayment. The Notes shall be prepaid in full, together with any
interest accrued thereon, in the event that the Commitment is reduced to zero
dollars ($0.00).
(b) (i) In the event of a Change of Control, the Company shall,
immediately upon learning thereof, but in any event within five (5) days after
the date of such Change of Control, give written notice to each holder of a Note
of the Change of Control, accompanied by a certificate of an authorized officer
of the Company describing in detail the nature of the Change of Control and
containing an offer by the Company to prepay the Notes on the terms set forth in
the following sentence (the "Change Notice"). Subject to clause (ii) of this
paragraph (b), the Company shall prepay, on a date specified in such notice by
the Company which shall be not less than forty five (45) or more than sixty (60)
calendar days after the effective date of such Change in Control, the entire
principal amount of the Notes held by each holder at the price set forth in
Section 2.2(b).
(ii) A holder of Notes may accept or reject the offer of the
Company to prepay Notes made pursuant to clause (i) of this paragraph (b) by
causing a notice of such acceptance or rejection to be delivered to the Company
not more than thirty (30) calendar days following receipt of the Change Notice.
A failure by a holder of Notes to respond to an offer to prepay made pursuant to
clause (i) of this paragraph (b) shall be deemed to constitute an acceptance of
such offer by such holder.
2.2 Optional Prepayments.
(a) Upon notice as provided in Section 2.3, the Company may prepay the
Notes, in whole or in part, at any time, in an amount of not less than
$1,000,000 or in integral multiples of $100,000 in excess thereof at the price
set forth in Section 2.2(b).
(b) Each prepayment made pursuant to only Section 2.1(b) or paragraph
(a) of this Section 2.2 shall be at a price of (i) 100% of the principal amount
to be prepaid, plus interest accrued thereon to the date of prepayment, if the
Reinvestment Yield, on the applicable Determination Date, equals or exceeds the
interest rate payable on or in respect of the Notes, or (ii) 100% of the
principal amount to be prepaid, plus interest accrued thereon to the date of
prepayment, plus a premium, if the Reinvestment Yield, on such Determination
Date, is less than the interest rate payable on or in respect of the Notes. The
premium shall equal (x) the aggregate present value of the amount of principal
being prepaid (taking into account the manner of application of such prepayment
required by Section 2.2(c)) and the present value of the amount of interest
(exclusive of interest accrued to the date of prepayment) which would have been
payable in respect of such principal absent such prepayment, determined by
discounting (semi-annually on the basis of a 360-day year composed of twelve
30-day months) each such amount utilizing an interest factor equal to the
Reinvestment Yield, less (y) the principal amount to be prepaid.
(c) Any prepayment pursuant to Section 2.2(a) or Section 7.15 of less
than all of the Notes outstanding shall be applied, to reduce, pro rata, each of
the prepayments and the final payment at maturity required by Section 2.1.
(d) Except as provided in Section 2.1, this Section 2.2 and Section
7.15, the Notes shall not be prepayable in whole or in part.
2.3 Notice of Prepayments.
The Company shall give notice of any prepayment of the Notes pursuant to Section
2.1(b), Section 2.2(a) or Section 7.15 to each holder of the Notes not less than
thirty (30) days nor more than sixty (60) days before the date fixed for
prepayment, specifying (i) such date, (ii) the principal amount of the holder's
Notes to be prepaid on such date, (iii) the date as of which the premium, if
any, will be calculated and (iv) the accrued interest applicable to the
prepayment. Notice of prepayment having been so given, the aggregate principal
amount of the Notes specified in such notice, together with the premium, if any,
and accrued interest thereon shall become due and payable on the prepayment date
specified in such notice.
The Company also shall give notice to each holder of the Notes by telecopy,
telegram, telex or other same-day written communication, as soon as practicable
but in any event not later than two business days prior to the prepayment date,
of the premium, if any, applicable to such prepayment and the details of the
calculations used to determine the amount of such premium.
2.4 Surrender of Notes on Prepayment or Exchange.
Subject to Section 2.5, upon any partial prepayment of a Note pursuant to this
Section 2 or partial exchange of a Note pursuant to Section 10.3, such Note may,
at the option of the holder thereof, (i) be surrendered to the Company pursuant
to Section 10.3 in exchange for a new Note equal to the principal amount
remaining unpaid on the surrendered Note, or (ii) be made available to the
Company for notation thereon of the portion of the principal so prepaid or
exchanged. In case the entire principal amount of any Note is prepaid or
exchanged, such Note shall, at the written request of the Company, be
surrendered to the Company for cancellation and shall not be reissued, and no
Note shall be issued in lieu of such Note.
2.5 Direct Payment.
Notwithstanding any other provision contained in the Notes or this Agreement,
the Company will pay all sums becoming due on each Note held by you or any
subsequent Noteholder by wire transfer of immediately available federal funds to
such account as you or such subsequent Noteholder has designated in Schedule I,
or as you or such subsequent Noteholder may otherwise designate by written
notice to the Company, in each case without presentment and without notations
being made thereon, except that any such Note so paid or prepaid in full shall,
at the written request of the Company, be surrendered to the Company for
cancellation. Any wire transfer shall identify such payment in the manner set
forth in Schedule I and shall identify the payment as principal, premium, if
any, and/or interest. You and any subsequent Noteholder to which this Section
2.5 applies agree that, before selling or otherwise transferring any such Note,
you or it will make a notation thereon of the aggregate amount of all payments
of principal theretofore made and of the date to which interest has been paid.
2.6 Allocation of Payments.
If less than the entire principal amount of all the Notes outstanding is to be
paid, the Company will prorate the aggregate principal amount to be paid among
the outstanding Notes in proportion to the unpaid principal.
2.7 Payments Due on Saturdays, Sundays and Holidays.
In any case where the date of any required prepayment of the Notes or any
interest payment date on the Notes or the date fixed for any other payment of
any Note or exchange of any Note is not a Business Day, then such payment,
prepayment or exchange need not be made on such date but may be made on the next
preceding Business Day, with the same force and effect as if made on the due
date.
3. REPRESENTATIONS
3.1 Representations of the Company.
As an inducement to, and as part of the consideration for, your purchase of the
Notes pursuant to this Agreement, the Company represents and warrants to you as
follows:
(a) Corporate Organization and Authority. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of New York, has all requisite corporate power and authority to own and
operate its properties, to carry on its business as now conducted and as
presently proposed to be conducted, to enter into and perform this Agreement and
the Security Documents and to issue the Notes as contemplated in this Agreement.
Each of the Subsidiary Guarantors has the corporate power to execute and deliver
its Subsidiary Guarantee and to perform the provisions thereof and to execute
and deliver the Security Documents to which each is a party and to perform the
provisions thereof.
(b) Qualification to Do Business. The Company is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization, and, except where the failure to do so, individually or in the
aggregate, could not reasonably be expected to result in a Material Adverse
Effect, is qualified to do business in, and is in good standing in, every
jurisdiction where such qualification is required.
(c) Subsidiaries. The Company has no Subsidiaries, except those listed
in Annex I, which correctly sets forth the jurisdiction of incorporation and the
percentage of the outstanding Voting Stock or equivalent interest of each
Subsidiary which is owned, of record or beneficially, by the Company and/or one
or more Subsidiaries. Each Subsidiary has been duly organized and is validly
existing and in good standing under the laws of its jurisdiction of
incorporation or organization and, except where the failure to do so,
individually or in the aggregate, could not reasonably be expected to result in
a Material Adverse Effect, is qualified to do business in, and is in good
standing in, every jurisdiction where such qualification is required. Each
Subsidiary has full corporate power and authority to own and operate its
properties and to carry on its business as now conducted and as presently
proposed to be conducted. Each Subsidiary Guarantor has all requisite corporate
power and authority to issue its Subsidiary Guarantee and to execute the
Subordination Agreement. The Company or each Subsidiary has good and marketable
title to all of the shares it purports to own of the capital stock of each
Subsidiary, as the case may be, free and clear in each case of any Lien or
encumbrance, and all such shares have been duly issued and are fully paid and
nonassessable.
(d) Financial Statements. The audited consolidated balance sheets of
the Company and its Subsidiaries as of January 27, 2001 and the related audited
consolidated statements of income, stockholders' equity and cash flows for the
year ended January 27, 2001, accompanied by the report and unqualified opinion
of PricewaterhouseCoopers LLP, independent certified public accountants, copies
of which have heretofore been delivered to you, were prepared in accordance with
GAAP (except as otherwise noted therein) and present fairly the consolidated
financial condition and consolidated results of operations and cash flows of the
Company and its Subsidiaries for and as of the end of each of such year.
(e) No Contingent Liabilities or Adverse Changes. Neither the Company
nor any of its Subsidiaries has any contingent liabilities which are material to
the Company and its Subsidiaries taken as a whole other than as indicated on the
financial statements described in the foregoing paragraph (d) of this Section
3.1, and since January 27, 2001, there have been no material adverse changes in
the condition, financial or otherwise, of the Company and its Subsidiaries
except those occurring in the ordinary course of business.
(f) No Pending Litigation or Proceedings. There are no actions, suits
or proceedings pending or threatened against or affecting the Company or any of
its Subsidiaries, at law or in equity or before or by any Federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, which might result, either individually or
in the aggregate, in any material adverse change in the business, properties,
operations or condition, financial or otherwise, of the Company and its
Subsidiaries taken as a whole, on the Company's ability to perform its
obligations under this Agreement, any Security Document or the
Notes, or on any Subsidiary Guarantor's ability to perform its obligations under
any Security Document to which it is a party.
(g) Compliance with Law. (i) Neither the Company nor any of its
Subsidiaries is: (x) in default with respect to any order, writ, injunction or
decree of any court to which it is a named party; or (y) in default under any
law, rule, regulation, ordinance or order relating to its or their respective
businesses, the sanctions and penalties resulting from which defaults described
in clauses (x) and (y) might have a material adverse effect on the business,
properties, operations, assets or condition, financial or otherwise, of the
Company and its Subsidiaries taken as a whole, on the Company's ability to
perform its obligations under this Agreement, any Security Document or the
Notes, or on any Subsidiary Guarantor's ability to perform its obligations under
any Security Document to which it is a party.
(ii) Neither the Company nor any Subsidiary nor any Affiliate of
the Company is an entity defined as a "designated national" within the meaning
of the Foreign Assets Control Regulations, 31 C.F.R. Chapter V, or for any other
reason, subject to any restriction or prohibition under, or is in violation of,
any Federal statute or Presidential Executive Order, or any rules or regulations
of any department, agency or administrative body promulgated under any such
statute or Order, concerning trade or other relations with any foreign country
or any citizen or national thereof or the ownership or operation of any
property.
(h) Pension Reform Act of 1974. Based upon the representations of the
Purchasers set forth in Section 3.2, neither the purchase of the Notes by you
nor the consummation of any of the other transactions contemplated by this
Agreement is or will constitute a "prohibited transaction" within the meaning of
Section 4975 of the Internal Revenue Code of 1986, as amended (the "Code"), or
Section 406 of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"). The Internal Revenue Service has issued a favorable determination
letter with respect to each "employee pension benefit plan," as defined in
Section 3 of ERISA, established, maintained or contributed to by the Company or
any Subsidiary (except for any Plan which is unfunded and maintained primarily
for the purpose of providing deferred compensation for a select group of
management or highly compensated employees) (a "Plan") that the same is
qualified under Section 401(a) and related provisions of the Code and that each
related trust or custodial account is exempt from taxation under Section 501(a)
of the Code. All Plans of the Company or any Subsidiary comply in all material
respects with ERISA and other applicable laws. There exist with respect to the
Company or any Subsidiary no "multi-employer plans," as defined in the
Multi-employer Pension Plan Amendments Act of 1980, for which a material
withdrawal or termination liability may be incurred. There exist with respect to
all Plans or trusts established or maintained by the Company or any Subsidiary:
(i) no material accumulated funding deficiency within the meaning of ERISA; (ii)
no termination of any Plan or trust which would result in any material liability
to the Pension Benefit Guaranty Corporation ("PBGC") or any "reportable event,"
as that term is defined in ERISA, which is likely to constitute grounds for
termination of any Plan or trust by the PBGC; and (iii) no "prohibited
transaction," as that term is defined in ERISA, which is likely to subject any
Plan, trust or party dealing with any such Plan or trust to any material tax or
penalty on prohibited transactions imposed by Section 4975 of the Code.
(i) Title to Properties. The Company and each Subsidiary has (i) good
title in fee simple or its equivalent under applicable law to all the real
property owned by it and (ii) good title to all other Property owned by it, in
each case free from all Liens except (x) those securing Indebtedness of the
Company or a Subsidiary, which are listed in the attached Annex II and (y) other
Liens that would be permitted pursuant to Section 7.2.
(j) Leases. The Company and each Subsidiary enjoy peaceful and
undisturbed possession under all leases under which the Company or such
Subsidiary is a lessee or is operating. None of such leases contains any
provision that might materially and adversely affect the operation or use of the
property so leased. All of such leases are valid and subsisting and neither the
Company nor any Subsidiary is in default with respect to any such leases which
are material to the business, Properties, operations or condition, financial or
otherwise, of the Company and its Subsidiaries taken as a whole.
(k) Franchises, Patents, Trademarks and Other Rights. The Company and
each Subsidiary have all franchises, permits, licenses and other authority
necessary to carry on their businesses as now being conducted and as proposed to
be conducted, and none is in default under any of such franchises, permits,
licenses or other authority which are material to their respective businesses,
Properties, operations or condition, financial or
otherwise. The Company and each Subsidiary own or possess all patents,
trademarks, service marks, trade names, copyrights, licenses and rights with
respect to the foregoing necessary for the present conduct of their businesses,
without any known conflict with the rights of others which might result in any
material adverse change in their respective businesses, Properties, operations
or condition, financial or otherwise.
(l) Authorization.
(i) This Agreement, the Security Documents and the Notes have
been duly authorized by all necessary corporate action on the part of
the Company, have been duly executed and delivered by an authorized
officer of the Company and constitute the legal, valid and binding
obligations of the Company, enforceable in accordance with their
terms, except to the extent that enforcement thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws of general application relating to or affecting the
enforcement of the rights of creditors or by equitable principles,
regardless of whether enforcement is sought in equity or at law. The
sale of the Notes and compliance by the Company with all of the
provisions of this Agreement, the Security Documents and the Notes (i)
are within the corporate powers of the Company, (ii) have been duly
authorized by proper corporate action, (iii) are legal, (iv) will not
violate any provisions of any law or regulation or order of any court,
governmental authority or agency and (v) will not result in any breach
of any of the provisions of, or constitute a default under, or result
in the creation of any Lien on any property of the Company or any
Subsidiary under the provisions of, any charter document, by-law, loan
agreement or other agreement or instrument to which the Company or any
Subsidiary is a party or by which any of them or their property may be
bound.
(ii) Each of the Subsidiary Guarantees and the Security Documents
to which any Subsidiary Guarantor is a party have been duly authorized
by all necessary corporate action on the part of such Subsidiary
Guarantor, have been duly executed and delivered by an authorized
officer of such Subsidiary Guarantor and constitute the legal, valid
and binding obligations of such Subsidiary Guarantor, enforceable in
accordance with their terms, except to the extent that enforcement
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws of general application
relating to or affecting the enforcement of the rights of creditors or
by equitable principles, regardless of whether enforcement is sought
in equity or at law.
(m) No Defaults. The execution, delivery and performance by the
Company of this Agreement, the 1996 Note Agreement, the Notes and the Security
Documents and the execution, delivery and performance by each Subsidiary
Guarantor of each Subsidiary Guarantee and the Security Documents to which such
Subsidiary Guarantor is a party will not (i) contravene, result in any breach
of, or constitute a default under, or result in the creation of any Lien in
respect of any property of the Company or any Subsidiary under, any indenture,
mortgage, deed of trust, loan, purchase or credit agreement, lease, corporate
charter or by-laws, or any other agreement or instrument the violation of which
would result in a cross-default pursuant to the terms hereof to which the
Company or any Subsidiary is bound or by which the Company or any Subsidiary or
any of their respective Properties may be bound or affected, (ii) conflict with
or result in a breach of any of the terms, conditions or provisions of any
order, judgment, decree, or ruling of any court, arbitrator or Governmental
Authority applicable to the Company or any Subsidiary or (iii) violate any
provision of any statute or other rule or regulation of any Governmental
Authority applicable to the Company or any Subsidiary.
(n) Governmental Consent. Neither the nature of the Company or any of
its Subsidiaries, their respective businesses or properties, nor any
relationship between the Company or any of its Subsidiaries and any other
Person, nor any circumstances in connection with the offer, issue, sale or
delivery of the Notes is such as to require a consent, approval or authorization
of, or withholding of objection on the part of, or filing, registration or
qualification with, any Governmental Authority on the part of the Company in
connection with the execution and delivery of this Agreement, any Security
Document or the issue or delivery of the Notes, or in connection with the
execution and delivery by each Subsidiary Guarantors of its Subsidiary
Guarantees or any Security Document to which it is a party.
(o) Taxes. All tax returns required to be filed by the Company or any
Subsidiary in any jurisdiction have been filed or appropriate extensions have
been filed with respect thereto, and all taxes, assessments, fees and other
governmental charges upon the Company or any Subsidiary, or upon any of their
respective properties, income or franchises, which are due and payable, have
been paid timely or within appropriate extension periods or are being contested
in good faith by appropriate proceedings. The Company does not know of any
proposed additional tax assessment against it or any Subsidiary for which
adequate provision has not been made on its books. The federal income tax
liability of the Company and its Subsidiaries has been finally determined by the
Internal Revenue Service and satisfied for all taxable years up to and including
the taxable year ended January 31, 1998, and no material controversy in respect
of additional taxes due since such date is pending or to the Company's knowledge
threatened. The provisions for taxes on the books of the Company and each
Subsidiary are adequate for all open years and for the current fiscal period.
(p) Status under Certain Statutes. Neither the Company nor any
Subsidiary is: (i) a "public utility company" or a "holding company," or an
"affiliate" or a "subsidiary company" of a "holding company," or an "affiliate"
of such a "subsidiary company," as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended, or (ii) a "public utility" as defined
in the Federal Power Act, as amended, or (iii) an "investment company" or an
"affiliated person" thereof or an "affiliated person" of any such "affiliated
person," as such terms are defined in the Investment Company Act of 1940, as
amended.
(q) Private Offering. Neither the Company nor Manufacturers Hanover
Securities Corporation (the only Person authorized or employed by the Company as
agent, broker, dealer or otherwise in connection with the offering of the Notes
or any similar security of the Company) has offered any of the Notes or any
similar security of the Company for sale to, or solicited offers to buy any
thereof from, or otherwise approached or negotiated with respect thereto with,
any prospective purchaser, other than not more than 35 institutional investors,
including the Purchasers, each of whom was offered all or a portion of the Notes
at private sale for investment. Neither the Company nor anyone acting on its
authorization will offer the Notes or any part thereof or any similar securities
for issue or sale to, or solicit any offer to acquire any of the same from,
anyone so as to bring the issuance and sale of the Notes within the provisions
of Section 5 of the Securities Act.
(r) Effect of Other Instruments. Neither the Company nor any Subsidiary
is bound by any agreement or instrument or subject to any charter or other
corporate restriction which materially and adversely affects the business,
properties, operations, or condition, financial or otherwise, of the Company and
its Subsidiaries taken as a whole, the Company's ability to perform its
obligations under this Agreement, the Security Documents or the Notes, or any
Subsidiary Guarantor's ability to perform its obligations under its Subsidiary
Guarantee or under any Security Document to which it is a party.
(s) Use of Proceeds. The Company has applied the proceeds from the sale
of the Notes to reduce the outstanding balance of bank Indebtedness in the
approximate amount of $30,000,000 incurred to finance plant modernization. None
of the transactions contemplated in this Agreement (including, without
limitation thereof, the use of the proceeds from the sale of the Notes) will
violate or result in a violation of Section 7 of the Exchange Act, or any
regulations issued pursuant thereto, including, without limitation, Regulations
G, T, U and X of the Board of Governors of the Federal Reserve System (12
C.F.R., Chapter II). Neither the Company nor any Subsidiary owns or intends to
carry or purchase any "margin stock" within the meaning of Regulation G, and
none of the proceeds from the sale of the Notes will be used to purchase or
carry or refinance any borrowing the proceeds of which were used to purchase or
carry any "margin stock" or "margin security" in violation of Regulations G, T,
U or X.
(t) Condition of Property. All of the facilities of the Company and
each of its Subsidiaries are in sound operating condition and repair except for
facilities being repaired in the ordinary course of business or facilities which
individually or in the aggregate are not material to the business, properties,
operations, or condition, financial or otherwise, of the Company and its
Subsidiaries taken as a whole.
(u) Books and Records. The Company and each of its Subsidiaries (i)
maintain books, records and accounts in reasonable detail which accurately and
fairly reflect their respective transactions and business affairs, and (ii)
maintain a system of internal accounting controls sufficient to provide
reasonable
assurances that transactions are executed in accordance with management's
general or specific authorization and to permit preparation of financial
statements in accordance with GAAP.
(v) Full Disclosure. Neither the Confidential Information Memorandum
dated as of May 18, 2000 which has heretofore been delivered to you, the
financial statements referred to in paragraph (d) of this Section 3.1, the
Perfection Certificate dated as of April 27, 2001 delivered to the Lenders in
connection with the execution and delivery of the Credit Agreement, nor this
Agreement, nor any other statement or document furnished by the Company to you
in connection with the negotiation of the sale of the Original 1992 Senior
Notes, the issue of the Notes and in connection with the negotiation of this
Agreement, nor any document executed or delivered in connection therewith, taken
together, contain any untrue statement of a material fact or omit a material
fact necessary to make the statements contained therein or herein not misleading
in light of the circumstances under which they were made. There is no fact
known, or which, with reasonable diligence would be known, by the Company which
the Company has not disclosed to you in writing which has a Material Adverse
Effect on or, so far as the Company can now foresee, will have a Material
Adverse Effect on the business, property, operations or condition, financial or
otherwise, of the Company and its Subsidiaries taken as a whole, the ability of
the Company to perform its undertakings under and in respect of this Agreement,
the Security Documents and the Notes, or any Subsidiary Guarantor's ability to
perform its undertakings under and in respect of its Subsidiary Guarantee or any
Security Document to which it is a party.
(w) Environmental Compliance. The Company and each Subsidiary (i) is in
compliance in all material respects with all applicable environmental,
transportation, health and safety statutes and regulations, including, without
limitation, regulations promulgated under the Resource Conservation and Recovery
Act of 1976, 42 U.S.C. 'SS''SS'6901 et seq., and (ii) has not acquired, incurred
or assumed, directly or indirectly, any material contingent liability in
connection with the release or storage of any toxic or hazardous waste or
substance into the environment. The Company and its Subsidiaries have not
acquired, incurred or assumed, directly or indirectly, any material contingent
liability in connection with a release or other discharge of any hazardous,
toxic or waste material, including petroleum, on, in, under or into the
environment surrounding any property owned, used or leased by any of them.
3.2 Representations of the Purchasers.
As an inducement to, and as part of the Company's consideration for the sale of
the Original 1992 Senior Notes pursuant to the Original Agreement and for the
issue of the Notes pursuant to this Agreement, each of you represents,
respectively, and in entering into this Agreement the Company understands, that
(i) you are an Institutional Holder, (ii) you are acquiring Notes for the
purpose of investment and for your own account and not with a view to the
distribution thereof; provided that the disposition of your property shall at
all times be and remain within your control, subject, however, to compliance
with Federal securities laws. You acknowledge that the Notes have not been
registered under the Securities Act or the laws of any state and you understand
that the Notes must be held indefinitely unless they are subsequently registered
under the Securities Act or an exemption from such registration is available.
You have been advised that the Company does not contemplate registering, and is
not legally required to register, the Notes under the Securities Act.
Each of you further represents that either: (i) no part of the funds used by you
to purchase the Notes constituted assets allocated to any separate account
maintained by you; or (ii) no part of the funds used by you to purchase the
Notes constituted assets allocated to any separate account maintained by you
such that the application of such funds will constitute a prohibited transaction
under Section 406 of ERISA; or (iii) all or a part of such funds constituted
assets of one or more separate accounts maintained by you, and you have
disclosed to the Company the names of such employee benefit plans whose assets
in such separate account or accounts exceed 10% of the total assets or are
expected to exceed 10% of the total assets of such account or accounts as of the
date of such purchase and the Company has advised you in writing that the
Company is not a party-in-interest nor are the Notes employer securities with
respect to the particular employee benefit plans disclosed to the Company by you
as aforesaid (for the purpose of this clause (iii), all employee benefit plans
maintained by the same employer or employee organization are deemed to be a
single plan). As used herein, the terms "separate account," "party-in-interest,"
"employer securities," and "employee benefit plan" have the meanings assigned to
them in ERISA.
4. CLOSING CONDITIONS
Your obligation to purchase the Notes on the Closing Date shall be subject to
the performance by the Company of its agreements hereunder which are to be
performed at or prior to the time of delivery of the Notes, and to the following
conditions to be satisfied on or before the Closing Date:
4.1 Representations and Warranties.
The representations and warranties of the Company contained in this Agreement or
otherwise made in writing in connection herewith shall be true and correct on or
as of the Closing Date and the Company shall have delivered to you a certificate
to such effect, dated the Closing Date and executed by the President or the
chief financial officer of the Company.
4.2 Legal Opinions.
You shall have received from Xxxxxxxxx X. Xxxxxxxxx, Vice-President, General
Counsel and Secretary to the Company, and from Shearman & Sterling, special
counsel for the Company and the Subsidiary Guarantors, their respective
opinions, dated as of such Closing Date, in connection with transactions
contemplated herein, in form and substance satisfactory to you and covering
substantially the matters set forth or provided in the attached Exhibit B.
4.3 Events of Default.
No event shall have occurred and be continuing on the Closing Date which would
constitute an Event of Default or with notice or lapse of time or both would
become such an Event of Default, and the Company shall have delivered to you a
certificate to such effect, dated the Closing Date and executed by the President
or the chief financial officer of the Company.
4.4 Payment of Fees and Expenses.
The Company shall have paid all reasonable fees, expenses, costs and charges,
including the fees and expenses of your special counsel, incurred by you through
the date hereof and incident to the proceedings in connection with, and
transactions contemplated by, this Agreement and the Notes (including any
amendments, renewals, supplements or replacements thereto).
4.5 Legality of Investment.
Your acquisition of the Notes shall constitute a legal investment as of the
Closing Date under the laws and regulations of each jurisdiction to which you
may be subject (without resort to any "basket" or "leeway" provision which
permits the making of an investment without restriction as to the character of
the particular investment being made), and such acquisition shall not subject
you to any penalty or other onerous condition in or pursuant to any such law or
regulation.
4.6 Private Placement Number.
A private placement number shall have been obtained from Standard & Poor's CUSIP
Service Bureau (in cooperation with the Securities Valuation Office of the
National Association of Insurance Commissioners).
4.7 Issue of All Notes.
Contemporaneously with the issue of the Notes to you, the Company will complete
and close the issue of Notes being acquired by each of the Purchasers set forth
in Schedule I hereto.
4.8 Proceedings and Documents.
All proceedings taken in connection with the transactions contemplated by this
Agreement, and all documents and instruments incident to such transactions or
necessary to the consummation of such transactions shall be satisfactory in form
and substance to you and your special counsel, and you and your special counsel
shall have received copies (executed or certified as may be appropriate) of all
legal documents or proceedings which you and they may reasonably request.
4.9 Amendment Fee.
The Company shall have paid to the Noteholders an amendment fee equal to 0.25%
of the principal amount of the Notes on the effective date of this Agreement.
Such fee shall be deemed fully earned and nonrefundable when paid.
4.10 Credit Agreement.
The Company shall have delivered to you a correct, complete and executed copy of
the Credit Agreement and, simultaneously with the execution of this Agreement, a
correct, complete and executed copy of Amendment No. 1 to the Credit Agreement
dated as of May __, 2001.
4.11 Exchange of Notes.
On the Closing Date, the Company shall deliver to each Purchaser the Notes to be
received by such Purchaser as specified in Schedule I in exchange for any
original Notes held by such Purchaser.
5. INTERPRETATION OF AGREEMENT
5.1 Certain Terms Defined.
The terms hereinafter set forth when used in this Agreement shall have the
following meanings:
1996 Note Agreement - means that certain Amended and Restated Note Agreement
Dated as of November 15, 1996 by and among THC Systems, Inc., the Company and
the Purchasers which are signatories thereto, as such agreement may be amended,
restated, modified or supplemented from time to time.
Administrative Agent - means The Chase Manhattan Bank, in its capacity as
administrative agent for the Lenders under the terms and provisions of the
Credit Agreement.
Affiliate - means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.
Agreement - has the meaning as defined in Section 1.1.
Applicable Margin - means for any day, with respect to any Loans, the Applicable
Margin (expressed in terms of basis points (bps)) as determined according to the
applicable level ("Level") as indicated by the following grid, as set forth in
the Credit Agreement as in effect on April 27, 2001 (as such Level may change as
described in Section 7.21 hereof), with such Level to be determined on the basis
of the Consolidated Leverage Ratio of the Company and its consolidated
Subsidiaries as of the last day of each Fiscal Quarter of the Company as
reflected on the financial statements for such Fiscal Quarter delivered by the
Company pursuant to Section 6.1:
-------------------------------------------------------------------------------------------------------------------
Level l Xxxxx 0 Xxxxx 0 Xxxxx 0 Xxxxx 0 Xxxxx 6 Level 7
-------------------------------------------------------------------------------------------------------------------
Consolidated Leverage Ratio <= 2.50 <= 2.75 <= 3.00 <= 3.25 <= 3.50 <= 4.00 > 4.00
-------------------------------------------------------------------------------------------------------------------
Eurodollar Margin (bps) 150.0 175.0 200.0 250.0 300.0 320.0 335.0
-------------------------------------------------------------------------------------------------------------------
provided that (i) during the period from April 27, 2001 through and including
the date on which the Company delivers the financial statements under Section
6.1 for the Fiscal Quarter ending April 28, 2001, the applicable margin shall be
based on Xxxxx 0, and (ii) if the Company shall have failed to deliver the
financial statements required by Section 6.1 when due (without giving effect to
any grace period or notice requirement) or there shall have occurred an Event of
Default which has not been waived in the manner provided in Section 8.1 hereof,
the Applicable Margin shall immediately be adjusted to Level 7 until such time
delivery of such financial statements shall have been made or the Event of
Default shall have been cured or waived, as the case may be. Each change in the
Applicable Margin shall be effective on the first Business Day following
delivery of the most recent financial statements pursuant to Section 6.1 subject
to the proviso set forth in the preceding sentence.
Bank Event - means any reduction in the principal amount of the Commitment.
Business Day - means any day other than a Saturday, a Sunday or a day on which
commercial banks in New York, New York; Los Angeles, California; or Chicago,
Illinois are required or authorized to be closed.
Capital Lease Obligations - means the obligations of any Person to pay rent or
other amounts under any lease of (or other arrangement conveying the right to
use) real or personal property, or a combination thereof, which obligations are
required to be classified and accounted for as capital leases on a balance sheet
of such Person under GAAP, and the amount of such obligations shall be the
capitalized amount thereof determined in accordance with GAAP.
Capital Stock - means any and all shares, interests, participations or other
equivalents (however designated) of capital stock of a corporation, regardless
of type, class, preference or designation, and any and all equivalent ownership
interests in a Person other than a corporation, including membership interests,
partnership interests, or other equity interests, and any and all warrants,
options, purchase rights, conversion or exchange rights, voting rights, calls or
claims of any character with respect thereto.
Change in Capital - has the meaning as set forth in Section 1.2 hereof.
Change of Control - means the occurrence of any one or more of the following:
(a) any Person (other than an Executive Officer) or a group of Persons (other
than a group of Persons consisting solely of Executive Officers) shall purchase
or otherwise acquire, directly or indirectly, in one or more transactions,
beneficial ownership of securities representing 20% or more of the combined
voting power of the Company's Voting Stock, determined on the date prior to the
date of such purchase or acquisition (or, if there is more than one transaction,
the date of the last such purchase or acquisition);
(b) the Company shall convey, transfer, lease or otherwise dispose of all or
substantially all Consolidated Total Assets to any Person (other than a
Majority-Owned Subsidiary);
(c) there shall occur, in any consecutive twenty-four month period, a
replacement of or change in a majority of the members of the Board of Directors
of the Company, and such replacement shall not have been initiated by the Board
of Directors which is incumbent at the time of commencement of such twenty-four
month period;
(d) the Company shall merge or consolidate into any other corporation other than
into a Majority-Owned Subsidiary (and the Company shall not be the surviving
corporation) in a transaction in which more than 20% of the voting power of the
Company's Voting Stock (determined on the date prior to the date of the
consummation of such transaction) is exchanged;
(e) the Company or any Subsidiary shall purchase or otherwise acquire, directly
or indirectly, in one or more transactions, beneficial ownership of Voting Stock
of the Company, if, after giving effect to such purchase or acquisition, the
Company (together with all Subsidiaries) shall have acquired, during any period
of twelve consecutive months, beneficial ownership of an aggregate of 30% or
more of the Voting Stock of the Company outstanding on the date immediately
prior to the last such purchase or acquisition during such period (or, if there
is more than one transaction, the date of the last such purchase or
acquisition); or
(f) the Company shall make a distribution of cash, securities or other
properties (other than regular periodic cash dividends at a rate which is
substantially consistent with past practice, including with respect to increases
in dividends, and other than Common Stock or rights to acquire Common Stock) to
holders of capital stock (including by means of dividend, reclassification,
recapitalization or otherwise) which, together with all other such distributions
during the 365-day period preceding the date of such distribution, has an
aggregate fair market value in excess of an amount equal to 30% of the fair
market value of the Voting Stock of the Company outstanding on the date
immediately prior to such distribution.
Closing Date - has the meaning as defined in Section 1.4.
Code - has the meaning as defined in Section 3.1(h).
Collateral - means the assets, properties and rights of the Company and each
Loan Party, whether now owned or hereafter acquired, upon which a Lien is
purported to be created by any Security Document.
Collateral Agent - means The Chase Manhattan Bank or any successor Collateral
Agent appointed by the parties to the Collateral Agency Agreement.
Collateral Agency Agreement - means that certain Collateral Agency and
Intercreditor Agreement dated April 27, 2001 among the Lenders and certain other
senior creditors of the Company, as the same may be amended, supplemented or
modified from time to time.
Commitment - means, with respect to the Credit Agreement, the commitment to lend
thereunder in an amount equal to $275,000,000.
Consolidated EBITDA - means, for any period, Consolidated Net Income for such
period plus, without duplication and to the extent reflected as a charge in the
statement of such Consolidated Net Income for such period, the sum of (a) income
tax expense, (b) interest expense, (c) depreciation and amortization expense,
and (d) amortization of intangibles (including, but not limited to, goodwill)
and organization costs, all as determined on a consolidated basis; provided that
(y) in determining Consolidated EBITDA of the Company and its Subsidiaries (i)
for any period that includes the Fiscal Quarter ending October 30, 1999, there
shall also be added to Consolidated Net Income the sum of $8,500,000,
representing pre-tax extraordinary and non-recurring charges incurred in such
quarter, (ii) for any period that includes the Fiscal Quarter ending July 29,
2000, there shall be added to Consolidated Net Income the sum of $32,000,000,
representing pre-tax extraordinary and non-recurring charges incurred in such
quarter, and (iii) for any period that includes the Fiscal Quarter ending
October 28, 2000, there may be added to Consolidated Net Income pre-tax
extraordinary and non-recurring restructuring charges incurred in such quarter
in an amount not to exceed $7,000,000, and (z) for purposes of calculating
Consolidated EBITDA of the Company and its Subsidiaries for any period, the
Consolidated EBITDA of any Person acquired by the Company or its Subsidiaries
during such period shall be included on a pro forma basis for such period
(assuming the consummation of each such acquisition and the incurrence or
assumption of any Indebtedness in connection therewith occurred on the first day
of such period) if the consolidated balance sheet of such acquired Person and
its consolidated Subsidiaries as of the end of the period preceding the
acquisition of such Person and the related consolidated statements of income and
stockholders' equity and of cash flows for the period in respect of which
Consolidated EBITDA is to be calculated (i) have been previously provided to the
holders of the Notes and (ii) either (A) have been reported on without a
qualification arising out of the scope of the audit by independent certified
public accountants of nationally recognized standing or (B) have been found
acceptable by the holders of the Notes. Notwithstanding the foregoing,
(i) whenever the Consolidated EBITDA of Viners of Sheffield Limited is included
on a pro forma basis for any period which includes its fiscal quarter ended
April 20, 2000, there shall be excluded a $1,800,000 pre-tax non-recurring
employee bonus incurred in such quarter, and (ii) whenever the Consolidated
EBITDA of Delco International Ltd. is included on a pro forma basis for any
period which includes its fiscal quarter ended July 31, 2000, there shall be
excluded $3,000,000 in pre-tax non-recurring employee bonus and employee
compensation charges incurred in such quarter.
Consolidated Interest Coverage Ratio - means, as of the last day of any period
of four consecutive Fiscal Quarters, the ratio of (a) Consolidated EBITDA for
such period to (b) Consolidated Interest Expense for such period.
Consolidated Interest Expense - means, for any period, total interest expense
(including that attributable to Capital Lease Obligations) of the Company and
its Subsidiaries for such period with respect to all outstanding Indebtedness of
the Company and its Subsidiaries, as determined in accordance with GAAP.
Consolidated Leverage Ratio - means, as of the last day of any period of four
consecutive Fiscal Quarters, the ratio of (a) Consolidated Total Debt on such
date to (b) Consolidated EBITDA for such period.
Consolidated Net Income - means, for any period, the gross revenues of the
Company and its Subsidiaries for such period less all expenses and other proper
charges (including taxes on income), determined on a consolidated basis in
accordance with GAAP after eliminating earnings or losses attributable to
outstanding minority interests, but excluding in any event:
(a) (i) any gains or losses on the sale or other disposition of Investments and
(ii) any gains or losses on the sale or other disposition of plant, property and
equipment which gains or losses exceed, in the aggregate, $100,000 during any
Fiscal Year and any taxes on such excluded gains and any tax deductions or
credits on account of any such excluded losses;
(b) the proceeds of any life insurance policy;
(c) net earnings and losses of any Subsidiary accrued prior to the date it
became a Subsidiary, except to the extent permitted to be included in
Consolidated EBITDA pursuant to clause (z) of the definition of Consolidated
EBITDA set forth above;
(d) net earnings and losses of any Person (other than a Subsidiary),
substantially all the assets of which have been acquired in any manner by the
Company or any Subsidiary, realized by such Person prior to the date of such
acquisition, except to the extent permitted to be included in Consolidated
EBITDA pursuant to clause (z) of the definition of Consolidated EBITDA set forth
above;
(e) net earnings and losses of any Person (other than a Subsidiary) with which
the Company or a Subsidiary shall have consolidated or which shall have merged
into or with the Company or a Subsidiary prior to the date of such consolidation
or merger, except to the extent permitted to be included in Consolidated EBITDA
pursuant to clause (z) of the definition of Consolidated EBITDA set forth above;
(f) net earnings of any Person (other than a Subsidiary) in which the Company or
any Subsidiary has an ownership interest unless such net earnings shall have
actually been received by the Company or such Subsidiary in the form of cash
distributions or readily marketable securities;
(g) any portion of the net earnings of any Subsidiary which for any reason is
unavailable for payment of dividends to the Company or any other Subsidiary.
(h) earnings resulting from any reappraisal, revaluation or write-up of assets;
(i) any deferred or other credit representing any excess of the equity in any
Subsidiary at the date of acquisition thereof over the amount invested in such
Subsidiary;
(j) any gain arising from the acquisition of any securities of the Company or
any Subsidiary;
(k) any reversal of any contingency reserve, except to the extent that provision
for such contingency reserve shall have been made from income arising during
such fiscal period or during the period consisting of the four consecutive
Fiscal Quarters immediately following the end of such fiscal period; and
(l) any other extraordinary or non-recurring income or gain.
Consolidated Net Worth - means, at any date, all amounts which would, in
accordance with GAAP, be included on a consolidated balance sheet of the Company
and its Subsidiaries under stockholders' equity at such date.
Consolidated Total Assets - means the consolidated total assets of the Company
and its Subsidiaries determined in accordance with GAAP.
Consolidated Total Debt - means, as of the date of determination, the aggregate
principal amount of all Indebtedness of the Company and its Subsidiaries at such
date, determined on a consolidated basis in accordance with GAAP.
Control - means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
"Controlling" and "Controlled" have meanings correlative thereto.
Credit Agreement - means that certain Amended and Restated Credit Agreement
dated as of April 27, 2001, among the Company, The Chase Manhattan Bank, as
Administrative Agent and Collateral Agent, Banc of America Securities, LLC, as
Syndication Agent, Fleet National Bank, as Documentation Agent, HSBC Bank, USA,
as Senior Managing Agent, Chase Securities Inc., as Arranger, and the banks
signatory to such agreement, as such agreement may be from time to time amended.
The term "Credit Agreement" shall also include replacement or additional credit
agreements entered into by the Company or any Subsidiary with banks or other
institutional lenders.
Default - means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.
Deposit Accounts - means a demand, time, savings, passbook or other deposit
account maintained with a bank, savings and loan association, credit union or
other financial institution, or a branch of any the foregoing.
Determination Date - means the day two (2) Business Days prior to the date fixed
for a prepayment pursuant to a notice required by Sections 2.2(b) or 2.3 or the
day two (2) Business Days prior to the date of declaration pursuant to Section
8.2.
ERISA - has the meaning as defined in Section 3.1(h).
Event of Default - has the meaning as defined in Section 8.1.
Exchange Act - means the Securities Exchange Act of 1934, as amended, and as it
may be further amended from time to time.
Executive Officers - means the Persons listed as "executive officers" in the
most recent Form 10-K of the Company filed pursuant to the Exchange Act.
Fiscal Quarter or Fiscal Year - means the fiscal quarter or fiscal year of the
Company.
GAAP - means generally accepted accounting principles in the United States of
America, consistently applied.
Governmental Authority - means:
(a) the government of
(i) the United States of America or any State or other political
subdivision thereof, or
(ii) any jurisdiction in which the Company or any Subsidiary conducts
all or any part of its business, or which asserts jurisdiction over any
Properties of the Company or any Subsidiary, or
(b) any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government.
Guaranties - means all obligations (other than endorsements in the ordinary
course of business of negotiable instruments for deposit or collection) of a
Person guaranteeing or, in effect, guaranteeing any Indebtedness, dividend or
other obligation, of any other Person in any manner, whether directly or
indirectly, including, without limitation, all obligations incurred through an
agreement, contingent or otherwise, by such Person: (i) to purchase such
Indebtedness or obligation or any property or assets constituting security
therefor, (ii) to advance or supply funds (x) for the purchase or payment of
such Indebtedness or obligation, (y) to maintain working capital or other
balance sheet condition or otherwise to advance or make available funds for the
purchase or payment of such Indebtedness or obligation, (iii) to lease property
or to purchase securities or other property or services primarily for the
purpose of assuring the owner of such Indebtedness or obligation, or (iv)
otherwise to assure the owner of the Indebtedness or obligation against loss in
respect thereof. For the purposes of all computations made under this Agreement,
a Guaranty in respect of any Indebtedness for borrowed money shall be deemed to
be Indebtedness equal to the principal amount of such Indebtedness for borrowed
money which has been guaranteed, and a Guaranty in respect of any other
obligation or liability or any dividend shall be deemed to be Indebtedness equal
to the maximum aggregate amount of such obligation, liability or dividend.
Hedging Agreement - means any interest rate protection agreement, foreign
currency exchange agreement, commodity price protection agreement or other
interest or currency exchange rate or commodity price hedging arrangement.
Indebtedness - means (i) all items of borrowed money (including, without
limitation, Capital Lease Obligations and the deferred purchase price of
property or services other than current accounts payable arising in the ordinary
course of business), which in accordance with GAAP would be included in
determining total liabilities as shown on the liability side of a balance sheet
as of the date at which Indebtedness is to be determined, (ii) all Guaranties
(other than Guaranties of Indebtedness of the Company by a Subsidiary Guarantor
in accordance with Section 7.1(d) or of a Subsidiary Guarantor by the Company in
accordance with Section 7.1(d)), letters of credit and endorsements (other than
of notes, bills and checks presented to banks for collection or deposit in the
ordinary course of business), in each case to support Indebtedness of other
Persons; and (iii) all items of borrowed money secured by any mortgage, pledge
or Lien existing on Property owned subject to such mortgage, pledge, or Lien,
whether or not the borrowed money secured thereby shall have been assumed by the
Company or any Subsidiary. Indebtedness of the Company and its Subsidiaries as
of January 25, 1992 is set forth in Annex II hereto.
Institutional Holder - means any bank, trust company, insurance company, pension
fund, mutual fund or other similar financial institution, including, without
limiting the foregoing, any "qualified institutional buyer" within the meaning
of Rule 144A under the Securities Act, which is or becomes a Noteholder.
Investments - means all investments made, in cash or by delivery of property,
directly or indirectly, in any Person, whether by acquisition of shares of
capital stock, indebtedness or other obligations or securities or by loan,
advance, capital contribution or otherwise; provided, however, that
"Investments" shall not mean or include routine investments in property to be
used or consumed in the ordinary course of business.
Lenders - means the lenders to the Company pursuant to the terms and conditions
of the Credit Agreement.
Level - has the meaning ascribed to such term in the definition of Applicable
Margin set forth herein.
Lien - means any mortgage, deed of trust, hypothecation, pledge, security
interest, encumbrance, lien or charge of any kind, including any agreement to
grant any of the foregoing, any conditional sale or other title retention
agreement, any lease in the nature thereof, and the filing of or agreement to
file any financing statement under the Uniform Commercial Code of any
jurisdiction in connection with any of the foregoing, and in the case of
securities other than those of Xxxxxx Zwiesel Glaswerke, AG, any purchase,
option, call or similar right of a third party with respect to such securities.
Loan or Loans - means a loan or the loans made by the Lenders to the Company
pursuant to the terms and conditions of the Credit Agreement.
Loan Party - means the Company and each Material Domestic Subsidiary of the
Company which is a party to a Transaction Document, and any other Person which
guaranties, or grants a Lien on any of its assets to secure, the obligations
under this Agreement, the 1996 Note Agreement, the Credit Agreement or any of
the other Transaction Documents.
Long-Term Lease - means any lease of real or personal property (other than a
Capital Lease Obligation) having an original term of more than three years,
including any period for which the lease may be renewed at the option of the
lessor, whether or not theretofore renewed.
Majority-Owned - means, when applied to a Subsidiary, any Subsidiary 80% of the
Voting Stock of which is owned by the Company and/or its Majority-Owned
Subsidiaries.
Material Adverse Effect - means a material adverse effect on (a) the business,
assets, operations, prospects or condition, financial or otherwise, of the
Company and its Subsidiaries taken as a whole, (b) the ability of the Company to
perform any of its obligations under this Agreement or (c) the rights of or
benefits available to the Noteholders under this Agreement.
Material Domestic Subsidiary - means any Subsidiary which is incorporated in the
United States of America, any State thereof, or the District of Columbia, and
whose assets, as of the end of the most recent Fiscal Quarter, account for five
percent (5%) or more of the total assets of the Company and its Subsidiaries,
taken as a whole, determined in accordance with GAAP.
Material Foreign Subsidiary - means any Subsidiary which is incorporated in an
jurisdiction other than the United States of America, any State thereof, or the
District of Columbia, and whose assets, as of the end of the most recent Fiscal
Quarter, account for five percent (5%) or more of the total assets of the
Company and its Subsidiaries, taken as a whole, determined in accordance with
GAAP.
Noteholder - means any holder of a Note.
Notes - has the meaning as defined in Section 1.1.
PBGC - has the meaning as defined in Section 3.1(h).
Permitted Investments - means:
(a) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the United States of America (or by any
agency thereof to the extent such obligations are backed by the full faith and
credit of the United States of America), in each case maturing within one year
from the date of acquisition thereof;
(b) Investments in commercial paper
maturing within two hundred and seventy (270) days from the date of acquisition
thereof and having, at such date of acquisition, the highest credit rating
obtainable from S&P or from Xxxxx'x;
(c) Investments in certificates of deposit, banker's acceptances and time
deposits maturing within one hundred and eighty (180) days from the date of
acquisition thereof issued or guaranteed by or placed with, and money market
deposit accounts issued or offered by, any domestic office of any commercial
bank organized under the laws of the United States of America or any State
thereof which has a combined capital and surplus and undivided profits of not
less than $500,000,000;
(d) fully collateralized repurchase agreements with a term of not more than
thirty (30) days for securities described in clause (a) above and entered into
with a financial institution satisfying the criteria described in clause (c)
above;
(e) Hedging Agreements permitted by the terms of this Agreement and the Credit
Agreement;
(f) Investments arising in connection with the bankruptcy or reorganization of a
customer or supplier in settlement of delinquent obligations owed by such
customer or supplier and not exceeding the amount of such obligations owed;
(g) loans or advances made in the ordinary course of business to officers or
directors of the Company or any Subsidiary not exceeding $200,000 in the
aggregate outstanding at any time;
(h) Investments in Subsidiary Guarantors;
(i) Investments made in the ordinary course of business in Property and assets
to be used in the ordinary course of business of the Company and its
Subsidiaries;
(j) Investments in tax-exempt municipal bonds maturing not more than one year
from the date of issue and which bear at least a MIG-1 rating; and
(k) Guaranties by the Company of Long-Term Leases of Majority-Owned
Subsidiaries.
Person - means any individual, corporation, partnership, joint venture, limited
liability company, association, joint-stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
Plan - has the meaning as defined in Section 3.1(h).
Pledge Agreement - means the Pledge Agreement dated April 27, 2001 executed by
the Company and each Subsidiary Guarantor substantially in the form of Exhibit F
attached to the Credit Agreement, as the same may be amended, supplemented, or
otherwise modified from time to time.
Pro Rata Amount - means, in connection with Section 2.1 hereof, the percentage
amount of any reduction in the Commitment, such percentage to constitute the
percentage of the aggregate principal amount of Notes then outstanding to be
prepaid pursuant to Section 2.1 hereof.
Property or Properties - means any real or personal or tangible or intangible
asset.
Reinvestment Yield - means the sum of (i) the yield set forth on page "USD" of
the Bloomberg Financial Markets Service at 11:00 a.m., Central Time on the
Determination Date opposite the maturity of the U.S. Treasury Security
corresponding to the Weighted Average Life to Maturity, rounded to the nearest
month, of the principal amount of the Notes to be prepaid, plus (ii) .50 of 1%
with respect to Notes to be prepaid pursuant to Section 2.2(a) or (b) or Notes
the payment of which has been accelerated with premium pursuant to Section 8.2.
If no maturity exactly corresponding to such rounded Weighted Average Life to
Maturity shall appear therein, yields for the two most closely corresponding
published maturities (one of which occurs prior and the other subsequent to the
Weighted Average Life to Maturity) shall be calculated pursuant to the foregoing
sentence and the Reinvestment Yield shall be interpolated from such yields on a
straight-line basis (rounding in each of such relevant periods, to the nearest
month).
Rentals - means, as of the date of any determination thereof, all fixed payments
(including all payments which the lessee is obligated to make to the lessor on
termination of the lease or surrender of the property) payable by the Company or
a Subsidiary, as lessee or sublessee under a lease of real or personal property,
but exclusive of any amounts required to be paid by the Company or a Subsidiary
(whether or not designated as rents or additional rents) on account of
maintenance, repairs, insurance, taxes, assessments, amortization and similar
charges. Fixed rents under any so-called "percentage leases" shall be computed
solely on the basis of the minimum rents, if any, required to be paid by the
lessee regardless of sales volume or gross revenues.
Securities Act - means the Securities Act of 1933, as amended, and as it may be
further amended from time to time.
Security Agreement - means that certain Security Agreement dated as of April 27,
2001 executed by the Company and each Subsidiary Guarantor substantially in the
form attached hereto as Exhibit C, as the same may be amended, supplemented, or
otherwise modified from time to time.
Security Documents - means, collectively, the Security Agreement, Pledge
Agreement, and all financing statements, collateral assignments and other
security documents delivered to the Collateral Agent granting or purporting to
xxxxx x Xxxx on any assets to secure the obligations of the Company or any Loan
Party under the Credit Agreement, this Agreement, the 1996 Note Agreement or any
of the Transaction Documents.
Senior Secured Indebtedness - means indebtedness or obligations of the Company
and its Subsidiaries which are secured by the Liens created by the Security
Documents, including, without limitation, (i) Indebtedness under this Agreement,
the 1996 Note Agreement and the Credit Agreement and (ii) obligations under
Hedging Agreements to which any Lender is a party.
Subordinated Debt - means all Indebtedness of the Company or its Subsidiaries
subordinated in right of payment to Indebtedness arising under this Agreement or
the 1996 Note Agreement by written terms or agreement in form and substance
satisfactory to the Lenders and the Noteholders.
Subsidiary - means any corporation of which more than 50% of the outstanding
shares of Voting Stock are owned or controlled by the Company or one or more
Subsidiaries.
Subsidiary Guarantees - means those certain Amended and Restated Subsidiary
Guarantee Agreements substantially in the form attached as Exhibit E hereto
executed by each Subsidiary Guarantor, as the same may be amended, supplemented,
or otherwise modified from time to time.
Subsidiary Guarantors - means each of Buffalo China, Inc., Encore Promotions,
Inc., THC Systems, Inc. (formerly known as Oneida Community China, Inc.),
Sakura, Inc. (formerly known as Oneida Community China, Inc.), Delco
International Ltd., and each Subsidiary created or acquired after January 19,
1996, which becomes a "Guarantor" as such term is defined in the Credit
Agreement or which is required to issue a Subsidiary Guarantee pursuant to
Section 7.18.
Subsidiary Subordination Agreement - means that certain Amended and Restated
Subsidiary Subordination Agreement substantially in the form attached as Exhibit
D hereto executed by each Subsidiary Guarantor, as the same may be amended,
supplemented, or otherwise modified from time to time.
Tableware Business - means the business of (a) designing, manufacturing,
licensing, importing, selling, marketing, distributing or otherwise dealing in
tableware, kitchenware, and giftware, including but not limited to, dinnerware,
flatware, hollowware, giftware, glassware, crystal, stemware, cutlery, cookware,
table linens, kitchen, table or bar utensils and gadgets, and minor kitchen
appliances and equipment, and (b) licensing the Company's name for use on toys.
Transaction Documents - means, collectively, this Agreement, the 1996 Note
Agreement, the Credit Agreement, any promissory note delivered to a Lender
evidencing the Loans, the Subsidiary Guarantees, the Subsidiary Subordination
Agreements, the Security Documents, any agreement between the Company and the
Collateral Agent or the Administrative Agent with respect to the payment of
fees, any Hedging Agreement entered into with a Lender or an Affiliate of the
Lender, the Chase Working Capital Facility, as such term is defined in the
Security Agreement, the Scotiabank Metal Line, as such term is defined in the
Security Agreement, the LC's, as such term is defined in the Security Agreement,
and each other document, agreement or instrument delivered pursuant to the terms
of any of the foregoing, as the same may be amended, supplemented or otherwise
modified from time to time.
Voting Stock - means the capital stock of any class of a corporation having
power to vote for the election of members of the board of directors of such
corporation, or persons performing similar functions (whether or not at the time
stock of any class shall have or might have special voting powers or rights by
reason of the happening of any contingency).
Weighted Average Life to Maturity - means, as applied to any prepayment of
principal of the Notes, at any date, the number of years obtained by dividing
(a) the then outstanding principal amount of the Notes to be prepaid into (b)
the sum of the products obtained by multiplying (i) the amount of each then
remaining installment, sinking fund, serial maturity, or other required payment,
including payment at final maturity, foregone by such prepayment by (ii) the
number of years (calculated to the nearest 1/12th) which will elapse between
such date and the making of such payment.
Wholly-Owned Subsidiary - means, when applied to a Subsidiary, any Subsidiary
100% of the Voting Stock of which is owned by the Company or its Wholly-Owned
Subsidiaries. Terms which are defined in other Sections of this Agreement shall
have the meanings specified therein.
5.2 Accounting Principles.
Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; provided that, if the Company notifies the Noteholders that the
Company requests an amendment to any provision hereof to eliminate the effect of
any change occurring after the date hereof in GAAP or in the application thereof
on the operation of such provision (or if the Noteholders notifies the Company
that the Noteholders request an amendment to any provision hereof for such
purpose), regardless of whether any such notice is given before or after such
change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such
change shall have become effective until such notice shall have been withdrawn
or such provision amended in accordance herewith.
5.3 Valuation Principles.
Except where indicated expressly to the contrary by the use of terms such as
"fair value," "fair market value" or "market value," each asset, each liability
and each capital item of any Person, and any quantity derivable by a computation
involving any of such assets, liabilities or capital items, shall be taken at
the net book value thereof for all purposes of this Agreement. "Net book value",
for purposes herein, with respect to any asset, liability or capital item of any
Person shall mean the amount at which the same is recorded or, in accordance
with GAAP, should have been recorded in the books of account of such Person, as
reduced by any reserves which have been or, in accordance with GAAP, should have
been set aside with respect thereto, without giving effect to any write-up,
write-down or write-off, relating thereto which was made after the date of this
Agreement.
5.4 Direct or Indirect Actions.
Where any provision in this Agreement refers to action to be taken by any
Person, or which such Person is prohibited from taking, such provision shall be
applicable whether the action in question is taken directly or indirectly by
such Person.
5.5 Property.
Wherever the word "property" is used in this Agreement, the lower case "p" is
changed to the upper case "P".
5.6 Officers.
Wherever the phrase "chief financial officer" or "chief accounting officer" is
used, the phrase "or Senior Vice President, Finance, Treasurer or Controller"
shall be added.
6. AFFIRMATIVE COVENANTS
The Company agrees that, for so long as any amount remains unpaid on any Note:
6.1 Financial and Business Information and Reports.
The Company will furnish to you and to any other Institutional Holder (in
duplicate if you or such other holder so request), the following:
(a) As soon as available and in any event within forty five (45) days
after the end of each Fiscal Quarter of the Company (including the forth Fiscal
Quarter), a consolidated balance sheet of the Company and its Subsidiaries as of
the end of such Fiscal Quarter and for the then-elapsed portion of the Fiscal
Year, and related consolidated statements of earnings and cash flows of the
Company and its Subsidiaries for such Fiscal Quarter, setting forth in
comparative form the corresponding consolidated figures as of and for the
corresponding period or periods then ended of the previous Fiscal Year, all in
reasonable detail prepared in accordance with GAAP (except for changes disclosed
in such financial statements or in the notes thereto and concurred in by the
Company's independent certified public accountants) and certified by the chief
financial officer or chief accounting officer of the Company (i) outlining the
basis of presentation, and (ii) stating that the information presented in such
financial statements presents fairly the financial condition of the Company and
its Subsidiaries and the results of operations of the Company and its
Subsidiaries on a consolidated basis, subject to customary year-end audit
adjustments; provided that so long as the Company shall file a quarterly report
on Form 10-Q or any similar form with the Securities and
Exchange Commission or any successor agency which contains the information set
forth in this paragraph (a), the requirements of this paragraph (a) shall be
satisfied by forwarding Form 10-Q to the holder of the Notes within such 45-day
period;
(b) As soon as available and in any event within ninety (90) days after
the last day of each Fiscal Year an audited consolidated and consolidating
balance sheet of the Company and its Subsidiaries as of the end of such Fiscal
Year and the related audited consolidated and consolidating statements of
earnings, stockholders' equity and cash flows for such Fiscal Year, in each case
setting forth in comparative form figures for the preceding Fiscal Year, all in
reasonable detail, prepared in accordance with GAAP (except for changes
disclosed in such financial statements or in the notes thereto and concurred in
by independent certified public accountants) and accompanied by a report of
PricewaterhouseCoopers LLP, or any firm of independent public accountants of
recognized national standing selected by the Company, (without a "going concern"
or like qualification or exception and without any qualification or exception as
to the scope of such audit) to the effect that such financial statements have
been prepared in conformity with GAAP and present fairly, in all material
respects, the financial condition and results of operations of the Company and
its Subsidiaries on a consolidated basis; provided that so long as the Company
shall file an annual report on Form 10-K or any similar form with the Securities
and Exchange Commission or any successor agency which contains the information
set forth in this paragraph (b), the requirements of this paragraph (b) shall be
satisfied by forwarding Form 10-K to the holder of the Notes within such 90-day
period;
(c) Together with the financial statements delivered pursuant to
paragraphs (a) and (b) of this Section 6.1, a certificate of the chief financial
officer or chief accounting officer, (i) to the effect that such officer has
re-examined the terms and provisions of this Agreement and that as of the date
of such certificate, during the periods covered by such financial reports and as
of the end of such periods, the Company is not, or was not, in default in the
fulfillment of any of the terms, covenants, provisions and conditions of this
Agreement and that no Event of Default, or event which, with the lapse of time
or the giving of notice, or both, would become an Event of Default, is occurring
or has occurred as of the date of such certificate, during such periods and as
of the end of such periods, or if the signer is aware of any such default, event
or Event of Default, such xxxxxx shall disclose in such statement the nature
thereof, its period of existence and what action, if any, the Company has taken
or proposes to take with respect thereto, (ii) stating whether the Company is in
compliance with Sections 7.1 through 7.20 and setting forth, in sufficient
detail, the information and computations required to establish whether or not
the Company was in compliance with the requirements of such Sections 7.1 through
7.20 during the periods covered by the financial reports then being furnished
and as of the end of such periods and (iii) stating whether any change in GAAP
or in the application thereof has occurred since the date of the audited
financial statements referred to in Section 3.1(d) and, if any such change has
occurred, specifying the effect of such change on the financial statements
accompanying such certificate;
(d) Together with the financial reports delivered pursuant to paragraph
(b) of this Section 6.1, a certificate of the independent certified public
accountants (i) stating that in making the examination necessary for expressing
an opinion on such financial statements, nothing came to their attention that
caused them to believe that there is in existence or has occurred any Event of
Default hereunder, or any event (the occurrence of which is ascertainable by
accountants in the course of normal audit procedures) which, with the lapse of
time or the giving of notice, or both, would become an Event of Default
hereunder or, if such accountants shall have obtained knowledge of any such
event or Event of Default, describing the nature thereof and the length of time
it has existed and (ii) acknowledging that holders of the Notes may rely on
their opinion on such financial statements;
(e) Within fifteen (15) days after the Company obtains knowledge
thereof, notice of any litigation not fully covered by insurance or any
governmental proceeding pending against the Company or any Subsidiary in which
the damages sought exceed Five Million Dollars ($5,000,000) or which might
otherwise materially adversely affect the business, property, operations or
condition, financial or otherwise, of the Company and its Subsidiaries taken as
a whole;
(f) As soon as available, copies of each financial statement, notice,
report and proxy statement which the Company shall furnish to its stockholders;
copies of all press releases; copies of each registration statement and periodic
report which the Company may file with the Securities and Exchange Commission,
and any other similar or successor agency of the Federal government
administering the Securities Act, the Exchange Act or the Trust Indenture Act of
1939, as amended; copies of each report relating to the Company or its
securities which
the Company may file with any securities exchange on which any of the Company's
securities may be registered; copies of any orders in any material proceedings
to which the Company or any of its Subsidiaries is a party, issued by any
governmental agency, Federal or state, having jurisdiction over the Company or
any of its Subsidiaries; and, except at such times as the Company is a reporting
company under Section 13 or 15(d) of the Exchange Act or has complied with the
requirements for the exemption from registration under the Exchange Act set
forth in Rule 12g-3-2(b), such financial or other information as any holder of
the Notes may reasonably determine is required to permit such holder to comply
with the requirements of Rule 144A under the Securities Act in connection with
the resale by it of the Notes;
(g) As soon as available, a copy of each other report submitted to the
Company or any Subsidiary by independent accountants retained by the Company or
any Subsidiary in connection with any interim or special audit made by them of
the books of the Company or any Subsidiary;
(h) On or before the commencement of each Fiscal Year of the Company, a
copy of the budget of the Company and its Subsidiaries for such Fiscal Year;
(i) (1) promptly, and in any event within five (5) days after an
Executive Officer becoming aware of the Company's breach of a covenant, default
or event of default under the Credit Agreement, a written notice setting forth
the nature of such breach and the action, if any, that the Company proposes to
take or has taken with respect thereto and any responses received by the Company
from the Lenders with respect to such breach; and (2) promptly, and in any event
within the applicable time period specified in the Credit Agreement, all
information, notices, certificates and other documents required to be delivered
by the Company to the Lenders pursuant to such Credit Agreement;
(j) Immediately upon any increase or reduction in the Commitment, a
written notice setting forth such increase or reduction in the Commitment and
copies of any documents given to the Lenders or executed in connection with such
increase or reduction in the Commitment;
(k) Promptly after becoming known to an Executive Officer written
notice of the filing or commencement of any action, suit or proceeding by or
before any arbitrator or Governmental Authority against or affecting the Company
or any Affiliate thereof that, if adversely determined, could reasonably be
expected to result in a Material Adverse Effect;
(l) Promptly written notice of any amendment to or other modification
of or replacement of the Credit Agreement and copies of such amendment or
modification or replacement documentation;
(m) Promptly, and in any event within five (5) days, written notice of
(a) any increase or decrease in the Level from that which is in effect on May
__, 2001, (b) any other compensation requested by the Collateral Agent or the
Lenders and (c) any change by the Company from "Eurodollar" (as defined in the
Credit Agreement) pricing to "ABR" (as defined in the Credit Agreement) pricing
under the terms of the Credit Agreement when such "ABR" pricing remains in
effect for more than ten (10) consecutive Business Days with respect to any
borrowing under the terms of the Credit Agreement of more than Ten Million
Dollars ($10,000,000); and
(n) Promptly following receipt of any request therefor, such additional
information concerning the Company and its Subsidiaries or compliance with the
terms of this Agreement.
6.2 ERISA.
(a.) The Company agrees that all assumptions and methods used to
determine the actuarial valuation of employee benefits, both vested and
unvested, under any Plan of the Company or any Subsidiary, and each such Plan,
whether now existing or adopted after the date hereof, will comply in all
material respects with ERISA and other applicable laws.
(b) The Company will not at any time permit any Plan established,
maintained or contributed to by it or any Subsidiary or "affiliate" (as defined
in Section 407(d)(7) of ERISA) to:
(i) engage in any "prohibited transaction" as such term is defined
in Section 4975 of the Code or in Section 406 of ERISA;
(ii) incur any "accumulated funding deficiency" as such term is
defined in Section 412 of the Code or Section 302 of ERISA, whether or
not waived; or
(iii) be terminated under circumstances which are likely to result
in the imposition of a lien on the property of the Company or any
Subsidiary pursuant to Section 4068 of ERISA, if and to the extent such
termination is within the control of the Company;
if the event or condition described in clauses (i), (ii) or (iii) above is
likely to subject the Company or any Subsidiary or ERISA affiliate to a
liability which, in the aggregate, is material in relation to the business,
property, operations, or condition, financial or otherwise, of the Company and
its Subsidiaries taken as a whole.
(c) Upon the request of you or any other Institutional Holder, the
Company will furnish a copy of the annual report of each Plan (Form 5500)
required to be filed with the Internal Revenue Service. Copies of annual reports
shall be delivered no later than thirty (30) days after the later of the date
such report has been filed with the Internal Revenue Service or the date the
copy is requested.
(d) Promptly upon the occurrence thereof, the Company will give you and
each other Institutional Holder written notice of (i) a reportable event with
respect to any Plan; (ii) the institution of any steps by the Company, any
Subsidiary, any ERISA affiliate, the PBGC or any other person to terminate any
Plan; (iii) the institution of any steps by the Company, any Subsidiary, or any
ERISA affiliate to withdraw from any Plan; (iv) a prohibited transaction in
connection with any Plan; (v) any material increase in the contingent liability
of the Company or any Subsidiary with respect to any post-retirement welfare
liability; or (vi) the taking of any action by the Internal Revenue Service, the
Department of Labor or the PBGC with respect to any of the foregoing which, in
any of the events specified above, would result in any material liability of the
Company or any of its Subsidiaries.
6.3 Corporate Existence.
The Company will maintain and preserve, and will cause each Subsidiary to
maintain and preserve, its corporate existence and right to carry on its
business and use, and cause each Subsidiary to use, its best efforts to
maintain, preserve, renew and extend all of its rights, powers, privileges,
licenses, permits and franchises necessary to the proper conduct of its
business; provided, however, that the foregoing shall not prevent any
transaction permitted by Sections 7.3 or 7.4.
6.4 Payment of Obligations.
The Company will, and will cause each of its Subsidiaries to, pay its
obligations that, if not paid, could result in a Material Adverse Effect before
the same shall become delinquent or in default, except where (a) the validity or
amount thereof is being contested in good faith, (b) the Company or such
Subsidiary has set aside on its books adequate reserves with respect thereto in
accordance with GAAP and (c) the failure to make payment pending such contest
could not reasonably be expected to result in a Material Adverse Effect.
6.5 Maintenance of Properties.
The Company will maintain, preserve and keep, and will cause each Subsidiary to
maintain, preserve and keep, its properties (whether owned in fee or a leasehold
interest) in good repair and working order, ordinary wear and tear excepted, and
from time to time will make all necessary repairs, replacements, renewals and
additions.
6.6 Insurance.
The Company will insure and keep insured at all times all of its properties and
all of its Subsidiaries' properties which are of an insurable nature and of the
character usually insured by companies operating similar properties, against
loss or damage by fire and from other causes customarily insured against by
companies engaged in similar businesses in such amounts as are usually insured
against by such companies. The Company also will maintain for itself and its
Subsidiaries at all times with financially sound and reputable insurers adequate
insurance against loss or damage from such hazards and risks to the person and
property of others as are usually insured against by companies operating
properties similar to the properties of the Company and its Subsidiaries. All
such insurance shall be carried with financially sound and reputable insurers
accorded a rating of A-XII or better by A.M. Best Company, Inc. A summary of
insurance presently in force is contained in the attached Annex IV.
6.7 Maintenance of Records.
The Company will keep, and will cause each Subsidiary to keep, at all times
proper books of record and account in which full, true and correct entries will
be made of all dealings or transactions of or in relation to the business and
affairs of the Company or such Subsidiary, in accordance with GAAP (except for
such changes as are disclosed in such financial statements or in the notes
thereto and concurred in by the independent certified public accountants), and
the Company will, and will cause each Subsidiary to, provide reasonable
protection against loss or damage to such books of record and account.
6.8 Inspection of Properties and Records; Confidentiality.
The Company will allow, and will cause each Subsidiary to allow, any
representative of you or any other Institutional Holder, so long as you or such
other Institutional Holder holds any Note, at your expense, to visit and inspect
any of its properties, to examine its books of record and account and to discuss
its affairs, finances and accounts with its officers and its public accountants
(and by this provision the Company authorizes such accountants to discuss with
you or such Institutional Holder its affairs, finances and accounts), all at
such reasonable times and as often as you or such Institutional Holder may
reasonably request. So long as an Event of Default or an event which, with the
passage of time or the giving of notice, or both, would become an Event of
Default has occurred and is continuing, the Company agrees to pay the costs of
any inspections made pursuant to this Section 6.8. Each Noteholder covenants and
agrees to treat as confidential all nonpublic information furnished to it
pursuant to the provisions of Sections 6.1 and this 6.8 which has been
designated in writing as confidential by an officer of the Company; provided
that each Noteholder reserves the right to make such disclosure to (i) such
Noteholder's directors, officers, employees, auditors, financial advisers,
rating agencies and attorneys, (ii) any other Noteholder, (iii) any Person to
which such Noteholder offers to sell such Note or any part thereof or a
participation in all or any part of such Note, (iv) any Federal or state
regulatory authority having jurisdiction over such Noteholder, (v) the National
Association of Insurance Commissioners or any similar organization, (vi) effect
compliance with any law, rule, regulation or order applicable to you or any
other Institutional Holder, (vii) in response to any subpoena or other legal
process, (viii) in connection with any litigation to which you or any other
Institutional Holder are a party, or (ix) if an Event of Default has occurred
and is continuing, to the extent you or any other Noteholder may reasonably
determine such delivery and disclosure to be necessary or appropriate in the
enforcement or for the protection of the rights and remedies under the Notes,
this Agreement, the Subsidiary Guarantees or the Subsidiary Subordination
Agreement. The confidentiality restrictions contained in this Section 6.8 shall
not apply to information which (a) is or becomes generally available to the
public other than as a result of a disclosure by any Noteholder or its
representatives that is authorized by this Section 6.8 or (b) becomes available
to any Noteholder on a nonconfidential basis from a source other than the
Company or one of its agents.
6.9 Compliance with Laws.
The Company will comply, and will cause each Subsidiary to comply, with all
laws, rules and regulations relating to its or their respective businesses,
other than laws, rules and regulations the failure to comply with which or the
sanctions and penalties resulting therefrom, individually or in the aggregate,
would not have a Material Adverse Effect on the business, property, operations,
or condition, financial or otherwise, of the Company or such Subsidiary, and
would not result in the creation of a Lien which, if incurred in the ordinary
course of business, would not be permitted by Section 7.2 on any of the property
of the Company or any Subsidiary; provided, however, that the Company and its
Subsidiaries shall not be required to comply with laws, rules and regulations
the validity or applicability of which are being contested in good faith and by
appropriate proceedings; provided that the failure to comply with such laws,
rules or regulations would not have a Material Adverse Effect on the business,
properties, operations, assets or condition, financial or otherwise, of the
Company and its Subsidiaries taken as a whole.
6.10 Subsidiary Guarantees and Collateral.
The Company shall cause each Subsidiary which becomes a Material Domestic
Subsidiary after the Closing Date (whether by creation, acquisition, expansion
or otherwise) to promptly execute and deliver to the Noteholders and the
Administrative Agent or the Collateral Agent, as the case may be, (a) a
Subsidiary Guarantee and Subsidiary Subordination Agreement, (b) instruments in
form and substance reasonably satisfactory to the Noteholders and the Collateral
Agent pursuant to which the new Material Domestic Subsidiary shall become a
party to the Security Documents, and (c) such other financing statements,
documents and certificates as may be reasonably requested by the Noteholders and
the Administrative Agent or the Collateral Agent, as the case may be, to
establish the organization and good standing of such Material Domestic
Subsidiary, the due authorization and execution of the Subsidiary Guarantee,
Subsidiary Subordination Agreement and the Security Documents, and the
perfection of the Liens created by the Security Documents. With respect to each
new Material Domestic Subsidiary or Material Foreign Subsidiary formed or
acquired after the Closing Date, the Company and each Material Domestic
Subsidiary shall, in addition to executing the documents described in the
preceding sentence, pledge and deliver to the Collateral Agent, for the benefit
of the Noteholders and the Lenders, 100% of the Capital Stock of each new
Material Domestic Subsidiary and 65% of the Capital Stock of each new Material
Foreign Subsidiary), together with undated stock powers duly executed in blank.
6.11 Maintenance of Liens of the Security Documents.
The Company shall, and shall cause each Material Domestic Subsidiary to: (a)
promptly, upon the reasonable request of the Noteholders or the Collateral
Agent, at the Company's expense, execute, acknowledge and deliver any document
or instrument supplemental to or confirmatory of the Security Documents or
otherwise reasonably deemed by the Collateral Agent or the Noteholders necessary
or desirable for the continued validity, perfection and priority of the Liens in
the Collateral covered thereby, and (b) promptly notify the Collateral Agent and
the Noteholders in writing of any change in (i) its corporate name, (ii) the
location of its chief executive office, its principal place of business or any
office in which it maintains books or records relating to Collateral or at which
the Collateral is located (including the establishment of any new office or
facility), (iii) in its identity or corporate structure (iv) any newly acquired
intellectual property registrations or applications therefore in the United
States owned by it, or (v) in its federal taxpayer identification number. If at
any time after April 27, 2001 the Company or any of its Material Domestic
Subsidiaries shall acquire property which is required by the terms hereof or of
any of the Security Documents to be subject to a Lien created by the Security
Documents but is not subject to such Lien, as soon as possible after the
acquisition date of such property, the Company shall grant or cause to be
granted to the Collateral Agent, for the benefit of the Lenders and the
Noteholders, a first priority Lien in such property pursuant to documentation
reasonably satisfactory in form and substance to the Collateral Agent and the
Noteholders.
6.12 Taxes, Claims for Labor and Materials.
The Company will pay and discharge when due, and will cause each Subsidiary to
pay and discharge when due, all taxes, assessments and governmental charges or
levies imposed upon it or its property or assets, or upon properties leased by
it (but only to the extent required to do so by the applicable lease), prior to
the date on which penalties attach thereto, and all lawful claims which, if
unpaid, might become a Lien upon its property or assets, provided that neither
the Company nor any Subsidiary shall be required to pay any such tax,
assessment, charge, levy or claim, the payment of which is being contested in
good faith and by proper proceedings that will stay the forfeiture or sale of
any property and with respect to which adequate reserves are maintained in
accordance with GAAP.
6.13 Acquisition of Notes.
The Company will forthwith cancel any Notes in any manner or at any time
acquired by the Company or any Subsidiary or Affiliate and such Notes shall not
be deemed to be outstanding for any of the purposes of this Agreement or the
Notes.
6.14 Private Placement Number.
The Company consents to the filing of copies of this Agreement with Standard &
Poor's CUSIP Service Bureau and the National Association of Insurance
Commissioners to obtain a private placement number.
6.15 NAIC Filings.
The Company shall, on the date it provides its audited financial statements to
the Noteholders pursuant to Section 6.1(b), simultaneously provide such
statements to the National Association of Insurance Commissioners, Securities
Valuation Office, 000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
6.16 THC Systems, Inc. Voting Stock.
The Company shall at all times own 100% of the Voting Stock of THC Systems, Inc.
6.17 Most Favored Nation.
If the Company or any Subsidiary (i) becomes in any agreement or instrument
subject to additional or more restrictive covenants, reporting requirements,
events of default or provisions regarding any guaranties, security interests or
collateral (including all definitions relating to the foregoing) than those
imposed on them by this Agreement or (ii) grants to any Person more favorable
covenants, reporting requirements, events of default or provisions regarding any
guaranties, security interests or collateral (including all definitions relating
to the foregoing) than are granted to any Noteholder pursuant to this Agreement,
the Company shall immediately notify in writing and provide to the Noteholders a
copy of such covenant, reporting requirements, events of default or other
provisions (and all definitions relating to the foregoing) and this Agreement
shall be deemed to be amended automatically to incorporate such covenants,
reporting requirements, events of default or other provisions (and all such
definitions relating to the foregoing). The Company hereby agrees to cooperate
with the Noteholders in connection with the execution and delivery to the
Noteholders of an amendment to this Agreement incorporating any such covenants,
reporting requirements, events of default or other provisions (and all such
definitions relating to the foregoing). Any amendment to this Agreement made
pursuant to this Section 6.17 shall remain in effect only so long as such other
covenants, reporting requirements, events of default or other provisions (and
all such definitions relating to the foregoing) remain in effect.
7. NEGATIVE COVENANTS
The Company agrees that, for so long as any amount remains unpaid on any Note:
7.1 Indebtedness.
The Company will not, and will not permit any Subsidiary to, create, incur,
assume or permit to exist any Indebtedness, except Indebtedness of the following
nature which is otherwise permitted under Section 7.12 hereof:
(a) Indebtedness created hereunder and under the other Transaction
Documents;
(b) Indebtedness existing under the Original Agreement and set forth in
Annex II hereto, and extensions, renewals and replacements of any such
Indebtedness that do not increase the outstanding principal amount thereof;
(c) Indebtedness of the Company to any Subsidiary and of any Subsidiary
to the Company or to any other Subsidiary, provided that Indebtedness of
Subsidiaries who are not Material Domestic Subsidiaries owed to the Company or
to any Material Domestic Subsidiary shall not exceed $35,000,000 in the
aggregate, of which no more than $25,000,000 may be owed by Subsidiaries other
than Kenwood Silver Company, Inc.;
(d) Guaranties by the Company of Indebtedness of any Subsidiary
permitted under this Agreement and by any Subsidiary of Indebtedness of the
Company or of any other Subsidiary permitted under this Agreement, provided that
the Company and the Material Domestic Subsidiaries shall not Guaranty
Indebtedness of Subsidiaries which are not Material Domestic Subsidiaries in
excess of $15,000,000 in the aggregate;
(e) Indebtedness of the Company or any Subsidiary incurred to finance
the acquisition, construction or improvement of any fixed or capital assets,
including Capital Lease Obligations and any Indebtedness assumed in connection
with the acquisition of any such assets or secured by a Lien on any such assets
prior to the acquisition thereof, and extensions, renewals and replacements of
any such Indebtedness that do not increase the outstanding principal amount
thereof; provided that (i) such Indebtedness is incurred prior to or within one
hundred and eighty (180) days after such acquisition or after the completion of
such construction or improvement, (ii) the amount of such Indebtedness does not
exceed the cost of such acquisition, construction or improvement, and (iii) the
aggregate principal amount of Indebtedness permitted by this clause (e) shall
not exceed $25,000,000 at any time outstanding;
(f) Indebtedness of any Person that becomes a Subsidiary after the date
hereof; provided that (i) the creation or acquisition of the Subsidiary is
permitted by the terms hereof, (ii) such Indebtedness exists at the time such
Person becomes a Subsidiary and is not created in contemplation of or in
connection with such Person becoming a Subsidiary and (iii) the principal amount
of such Indebtedness, when added to other Indebtedness of the Company and its
Subsidiaries, does not violate subparagraphs (e) or (h) of this Section;
(g) unsecured Indebtedness of the Company; and
(h) unsecured Indebtedness of the Company's Subsidiaries which does not
exceed, in the aggregate, $25,000,000 outstanding at any time, exclusive of
unsecured Indebtedness of Subsidiaries listed on Annex II hereto.
7.2 Liens.
Neither the Company nor any Subsidiary will cause or permit or hereafter agree
or consent to cause or permit in the future (upon the happening of a contingency
or otherwise), any of its Property, whether now owned or subsequently acquired,
to be subject to a Lien except:
(a) Liens securing the payment of taxes, assessments or governmental
charges or levies or the demands of suppliers, mechanics, repairmen, workmen,
materialmen, carriers, warehousers, landlords and other like Persons, or similar
statutory Liens, provided that (i) such Liens do not in the aggregate materially
reduce the value of any Properties subject to the Liens or materially interfere
with their use in the ordinary conduct of the Company's or any Subsidiary's
business, (ii) all claims which such Liens secure are not delinquent or are
being actively contested in good faith and by appropriate proceedings and (iii)
adequate reserves have been established therefor on the books of the Company;
(b) Liens incurred or pledges and deposits made in the ordinary course
of business (i) in connection with worker's compensation, unemployment
insurance, social security and other like laws, or (ii) to secure the
performance of letters of credit, bids, tenders, trade contracts or sales
contracts, leases, statutory obligations, surety, appeal and performance bonds
and other similar obligations, in each case not incurred in connection with the
borrowing of money, the obtaining of advances or the payment of the deferred
purchase price of Property otherwise than permitted by paragraph (f) below;
(c) Attachment, judgment and other similar Liens arising in connection
with court proceedings that do not constitute an Event of Default under clause
(g) of Section 8.01, provided that (i) execution and other enforcement are
effectively stayed, (ii) all claims which the Liens secure are being actively
contested in good faith and by appropriate proceedings and (iii) adequate
reserves have been established therefor on the books of the Company, if required
by GAAP;
(d) Liens on Property of the Company or a Subsidiary existing under the
Original Agreement and set forth on Annex III hereto, provided that (i) such
Liens shall not apply to any other property or asset of the Company or any
Subsidiary and (ii) such Lien shall secure only those obligations which it
secures on the date hereof and extensions, renewals and replacements thereof
that do not increase the outstanding principal amount thereof;
(e) any Lien existing on any property or asset prior to the acquisition
thereof by the Company or any Subsidiary or existing on any property or asset of
any Person that becomes a Subsidiary after the date hereof prior to the time
such Person becomes a Subsidiary; provided that (i) the acquisition of such
property or assets or such Subsidiary is permitted by the terms hereof, (ii)
such Lien is not created in contemplation of or in connection with such
acquisition or such Person becoming a Subsidiary, as the case may be, (iii) such
Lien shall not apply to any other property or assets of the Company or any
Subsidiary and (iv) such Lien shall secure only those obligations which it
secures on the date of such acquisition or the date such Person becomes a
Subsidiary, as the case may be, and extensions, renewals and replacements
thereof that do not increase the outstanding principal amount thereof;
(f) Liens on fixed or capital assets acquired, constructed or improved
by the Company or any Subsidiary; provided that (i) such security interests
secure Indebtedness permitted by clause (e) of Section 7.1, (ii) such security
interests and the Indebtedness secured thereby are incurred simultaneously with
or within one hundred and eighty (180) days after such acquisition or the
completion of such construction or improvement, (iii) the Indebtedness secured
thereby does not exceed one hundred (100%) of the cost of acquiring,
constructing or improving such fixed or capital assets and (iv) such security
interests shall not apply to any other property or assets of the Company or any
Subsidiary;
(g) In the event that the Company or any Subsidiary creates, assumes,
incurs or permits to exist any Lien not otherwise permitted by this Section 7.2,
the Company will make or cause to be made provision whereby the Notes will be
secured equally and ratably with all other obligations secured by such Liens,
and in any case the Notes shall have the benefit, to the full extent that, and
with such priority as, the holders may be entitled thereto under applicable law,
of an equitable Lien on such Property securing the Notes. Any violation of this
Section 7.2 shall constitute an Event of Default whether or not any such
provision is made for equal and ratable security pursuant to this subparagraph
(g);
(h) Liens in favor of the Collateral Agent for the benefit of the
Noteholders and the Lenders granted pursuant to the terms and conditions of the
Security Documents; and
(i) Liens consisting of a call option on the shares of Xxxxxx Zwiesel
Glaswerke, AG owned by the Company.
7.3 Merger or Consolidation.
The Company will not, and will not permit any Subsidiary to, merge or
consolidate with any other Person or permit any other Person to merge into or
consolidate with it, or sell, transfer, lease or otherwise dispose of (in one
transaction or in a series of transactions), or engage in a sale/leaseback
transaction with respect to, any substantial part of its assets, any trade
receivables (other than an assignment in connection with the collection thereof
in the ordinary course of business), or all or substantially all of the stock of
any Subsidiary (in each case, whether now owned or hereafter acquired), or
liquidate or dissolve, except that:
(a) The Company may consolidate with or merge into any Person or permit
any other Person to merge into it, provided that,
(i) Immediately after giving effect thereto, the Company is the
successor corporation or, if the Company is not the successor
corporation, the successor corporation is a corporation organized under
the laws of a state of the United States of America or the District of
Columbia and shall expressly assume in writing the Company's
obligations under the Notes and this Agreement;
(ii) At the time thereof and immediately after giving effect
thereto, there shall exist no Event of Default or event which, with the
passage of time or giving of notice, or both, would constitute an Event
of Default; and
(iii) The Company or such successor corporation could incur at
least $1.00 of additional debt pursuant to the Consolidated Leverage
Ratio of Section 7.12 hereof as of the most recently reported Fiscal
Quarter;
(b) Any Subsidiary (except THC Systems, Inc.) may (A) merge into the
Company or another Majority-Owned Subsidiary Guarantor or (B) sell, transfer or
lease all or any part of its assets to the Company or to another Majority-Owned
Subsidiary Guarantor or (C) merge into any Person which, as a result of such
merger, concurrently becomes a Subsidiary, provided in each such instance that
there shall exist no Event of Default or event which, with the passage of time
or giving of notice, or both, would constitute an Event of Default;
(c) THC Systems, Inc. may merge into the Company; and
(d) The Company may sell its investment in Xxxxxx Zwiesel Glaswerke, AG
for consideration (whether cash, property or other consideration) of not less
than 7,500,000 DM;
provided that any merger permitted by clauses (i) or (ii) above involving a
Person that is not a Wholly-Owned Subsidiary immediately prior to such merger
shall not be permitted unless also permitted by Section 7.3 hereof.
7.4 Liquidate or Dissolve Subsidiaries; Sale of Assets.
The Company may liquidate or dissolve any Subsidiary (except THC Systems, Inc.)
if the Company determines in good faith that such liquidation or dissolution is
in the best interests of the Company and the assets of such Subsidiary are
distributed to the Company in liquidation or dissolution. Except as otherwise
permitted under the terms and conditions of the Collateral Agency Agreement, the
Company and its Subsidiaries may sell, transfer, or otherwise dispose of (in one
transaction or a series of transactions), or engage in a sale/leaseback
transaction with respect to, assets if the consideration received is in cash or
cash equivalents at least equal to the fair market value of such assets and the
aggregate consideration received does not exceed $15,000,000 for all such sales,
transfers, or dispositions.
7.5 Investments, Loans, Advances, Guaranties and Acquisitions.
The Company will not, and will not permit any of its Subsidiaries to, purchase,
hold or acquire (including pursuant to any merger with any Person that was not a
Wholly-Owned Subsidiary prior to such merger) any Capital Stock, evidences of
indebtedness or other securities (including any option, warrant or other right
to acquire any of the foregoing) of, make or permit to exist any loans or
advances to, Guaranty any obligations of, or make or permit to exist any
Investment or any other interest in, any other Person, or purchase or otherwise
acquire (in one transaction or a series of transactions) any assets of any other
Person constituting a business unit, except the Company and its Subsidiaries may
engage in transactions of the following nature so long as no Default or Event of
Default exists or would be created as a result thereof:
(a) Permitted Investments;
(b) Investments by the Company existing on the date hereof in the
Capital Stock of its Subsidiaries and in Xxxxxx Zwiesel Glaswerke, AG;
(c) loans or advances made by the Company to any Subsidiary and made by
any Subsidiary to the Company or any other Subsidiary which constitute
Indebtedness permitted by Section 7.1, provided that loans or advances made by
the Company or any Material Domestic Subsidiary are evidenced by a promissory
note or other instrument which is pledged to the Collateral Agent pursuant to
the Security Documents for the benefit of the Lenders and the Noteholders;
(d) Guaranties constituting Indebtedness permitted by Section 7.1(d);
(e) repurchases or redemptions of the capital stock of the Company
permitted by applicable law;
(f) the purchase by the Company of the remaining outstanding Capital
Stock of Oneida International Inc., which the Company currently does not own,
for a purchase price of not more than 845,000,000 Italian Lira; and
(g) purchases or acquisitions of (whether by merger, consolidation,
purchase, share exchange or otherwise), or Investments in, the assets or Capital
Stock of another Person, provided that (i) prior to any such purchase,
acquisition or Investment, the Noteholders shall have received a certificate
from a Financial Officer of the Company (A) setting forth calculations which
demonstrate that, on a pro forma basis, after giving effect to the proposed
purchase, acquisition or investment, the Consolidated Leverage Ratio of the
Company and its Subsidiaries is less than 2.50 to 1.0, and the Company is in
compliance with Section 7.12 hereof as of the end of the most recent Fiscal
Quarter, and (B) certifying that no other Default or Event of Default exists or
would be created as a result thereof, (ii) the Person purchased or acquired or
in which an Investment is made is engaged solely in the Tableware Business, and
(iii) the aggregate consideration (exclusive of consideration consisting solely
of the Capital Stock of the Company) paid by the Company or any Subsidiary in
connection with the purchase of assets from, acquisition of the Capital Stock
of, or Investment in, any single Person (whether in a single transaction or in a
series of transactions) shall not exceed $20,000,000 without the consent of the
Noteholders.
7.6 Hedging Agreements.
The Company will not, and will not permit any of its Subsidiaries to, enter into
any Hedging Agreement, other than Hedging Agreements entered into in the
ordinary course of business to hedge or mitigate risks to which the Company or
any Subsidiary is exposed in the conduct of its business or the management of
its liabilities; provided that the maximum aggregate amount (after giving effect
to any netting agreements) that the Company and its Subsidiaries would be
required to pay under all such Hedging Agreements if such Hedging Agreements
were terminated at any time shall not exceed $5,000,000.
7.7 Transactions with Affiliates.
The Company will not, and will not permit any of its Subsidiaries to, sell,
lease or otherwise transfer any property or assets to, or purchase, lease or
otherwise acquire any Property from, or otherwise engage in any other
transactions with, any of its Affiliates, except (a) in the ordinary course of
business at prices and on terms and conditions not less favorable to the Company
or such Subsidiary than could be obtained on an arm's-length basis from
unrelated third parties, or (b) transactions between or among the Company and
its Wholly-Owned Subsidiaries not involving any other Affiliate.
7.8 Restrictive Agreements.
The Company will not, and will not permit any of its Subsidiaries to, directly
or indirectly, enter into, incur or permit to exist any agreement or other
arrangement that prohibits, restricts or imposes any condition upon the ability
of any Restrictive Subsidiary to pay dividends or other distributions with
respect to any shares of its Capital Stock or to make or repay loans or advances
to the Company or any other Subsidiary or to Guaranty Indebtedness of the
Company or any other Subsidiary; provided that (i) the foregoing shall not apply
to restrictions and conditions imposed by law, by this Agreement or by the
Credit Agreement, (ii) the foregoing shall not apply to restrictions and
conditions existing on the date hereof identified on Annex V attached hereto
(but shall apply to any extension or renewal of, or any amendment or
modification expanding the scope of, any such restriction or condition), and
(iii) the foregoing shall not apply to customary restrictions and conditions
contained in agreements relating to the sale of a Subsidiary pending such sale,
provided such restrictions and conditions apply only to the Subsidiary that is
to be sold and such sale is permitted hereunder.
7.9 Fiscal Year, Accounting Policies and Consolidated Tax Returns.
The Company shall not make any change in its Fiscal Year or change its
accounting policies or practices from those in effect on May __, 2001, except to
the extent such change is required by GAAP. The Company will not file, or
consent to the filing of, any consolidated Federal income tax return with any
Person other than a Subsidiary, except to the extent that the Company is
otherwise required to do so under the Code.
7.10 Subordinated Debt.
The Company shall not, and will not permit any of its Subsidiaries to, modify
the terms of any Subordinated Debt or to pay any principal of, interest on, or
other amount in respect of, Subordinated Debt other than scheduled payments of
principal and interest on Subordinated Debt if and to the extent permitted under
the terms of a written subordination agreement executed and delivered by the
subordinated creditor containing terms acceptable to the Collateral Agent and
the Noteholders.
7.11 Negative Pledges.
The Company shall not, and shall not permit any of its Subsidiaries to, enter
into any agreement which prohibits or limits the ability of the Company or any
of its Subsidiaries to create, incur, assume or suffer to exist any Lien upon
any of its property, assets or revenues, whether now owned or hereafter
acquired, except operating leases, purchase money Liens or Capital Lease
Obligations permitted by this Agreement containing such a prohibition or
limitation solely as to the assets financed thereby.
7.12 Financial Covenants.
(a) Consolidated Interest Coverage Ratio. For a period of four (4)
consecutive Fiscal Quarters ending with its most recent Fiscal Quarter, the
Company will not permit the Consolidated Interest Coverage Ratio of the Company
and its Subsidiaries to be less than (i) 2.70 to 1.00 for the Fiscal Quarter
ended Xxxxx 00, 0000, (xx) 2.40 to 1.00 for the Fiscal Quarter ending July 28,
2001, (iii) 2.20 to 1.00 for the Fiscal Quarter ending October 27, 2001, (iv)
2.50 to 1.00 for the Fiscal Quarter ending January 26, 2002, (v) 2.75 to 1.00
for the Fiscal Quarter ending April 27, 2002, and (vi) 3.00 to 1.00 for each
succeeding Fiscal Quarter.
(b) Leverage Ratio. The Company will not permit the Consolidated
Leverage Ratio of the Company and its Subsidiaries to be greater than (i) 4.30
to 1.00 as of the last day of the Fiscal Quarter ended April 28, 2001 and the
last day of the Fiscal Quarter ending July 28, 2001, (ii) 4.45 to 1.00 as of the
last day of the Fiscal Quarter ending October 27, 2001, (iii) 4.10 to 1.00 as of
the last day of the Fiscal Quarter ending January 26, 2002, (iv) 3.85 to 1.00 as
of the last day of the Fiscal Quarter ending April 27, 2002, (v) 3.55 to 1.00 as
of the last day of the Fiscal Quarter ending July 27, 2002, (vi) 3.10 to 1.00 as
of the last day of the Fiscal Quarter ending October 26, 2002, and (vii) 3.00 to
1.00 as of the last day of each succeeding Fiscal Quarter.
(c) Consolidated Net Worth. As of the last day of any Fiscal Quarter,
the Company will not permit Consolidated Net Worth of the Company and its
Subsidiaries to be less than the sum of (i) $118,000,000, plus (ii) 75% of the
Consolidated Net Income of the Company and its Subsidiaries (which for the
purposes of this covenant shall not be reduced by losses) for the six-month
periods ending with each second and fourth Fiscal Quarter commencing with the
Fiscal Quarter ending July 29, 2001.
7.13 Letters of Credit.
The Company will not, and will not permit any Subsidiary to, become an account
party in respect of, or otherwise incur obligations under, any letters of credit
or bankers' acceptances except obligations in respect of (i) trade letters of
credit and bankers' acceptances in an amount not to exceed $15,000,000 in the
aggregate and (ii) standby letters of credit in an amount not to exceed
$20,000,000 in the aggregate.
7.14 Deposit Accounts.
The Company will not, and will not permit any of its Material Domestic
Subsidiaries to, open or maintain any Deposit Account with a Person other than
one of the Lenders unless the Collateral Agent, for the benefit of the Lenders
and Noteholders, shall have a perfected first priority Lien therein.
7.15 Prepayment of Indebtedness.
The Company will not, and will not permit any of its Subsidiaries to, make any
optional payment or prepayment of, or purchase or redeem, any Indebtedness
except: (a) payments of the Notes as permitted hereunder and of the Loans as
permitted under the terms and conditions of the Credit Agreement, (b) payments
made in the ordinary course of business of other Indebtedness consisting of
working capital lines of credit or metal consignment facilities which
contemplate unscheduled periodic payments and advances or readvances, (c)
prepayments of Senior Secured Indebtedness (including the Notes hereunder and
the Loans under the terms and conditions of the Credit Agreement), other than
those permitted by clauses (a) and (b), provided the prepayments are applied to
all Senior Secured Indebtedness on a pro rata basis and the Commitments are
permanently reduced by the amount of the payments applied to the Notes and Loans
under this subparagraph, (d) optional payments or prepayments of Indebtedness
other than Senior Secured Indebtedness not to exceed $5,000,000 in the
aggregate, or (e) prepayments of Indebtedness in connection with refinancings or
replacements of such Indebtedness that do not increase the outstanding principal
amount thereof.
7.16 Long-Term Leases.
The Company will not, and will not permit any Subsidiary to, become obligated,
as lessee under any Long-Term Lease unless, at the time of entering into such
Long-Term Lease and after giving effect thereto, the average aggregate annual
Rentals payable by the Company and its Subsidiaries on a consolidated basis
during the term of such Long-Term Lease pursuant to Long-Term Leases will not
exceed 10% of Consolidated Net Worth, determined as of the end of the Company's
prior Fiscal Quarter.
7.17 Change in Business.
The Company will not, and will not permit any Subsidiary to, engage to any
material extent in any business other than the Tableware Business.
7.18 Pari Passu Position.
The Company agrees that it will not grant or provide, and at no time will it
allow to exist, be created or granted, any Liens or security interests in favor
of, or Guaranties by Subsidiaries for the benefit of, any of the Lenders, unless
in the case of the giving of any Guaranty by Subsidiaries, the Noteholders shall
simultaneously be provided with a Subsidiary Guarantee.
7.19 Collateral Agency Agreement.
The Company shall not permit any Subsidiary to incur Indebtedness or to issue a
Subsidiary Guarantee without requiring that the lender of such Indebtedness or
beneficiary of such Subsidiary Guarantee execute the Collateral Agency Agreement
at the time of such incurrence of Indebtedness.
7.20 Change in Commitment.
The Company will not, and will not permit any of its Subsidiaries to, (a) reduce
the Commitment, as permitted under Section 2.07 of the Credit Agreement, or (b)
increase the Commitment without the prior written consent of the Noteholders.
7.21 Change in Level.
Any increase or decrease as a result of an amendment to the Credit Agreement in
"Eurodollar Margin" as such term is used in the definition of "Applicable
Margin" in the Credit Agreement, as well as any related changes in any other
terms or conditions of the Credit Agreement, shall be deemed to be immediately
incorporated by reference herein as of such date of increase or decrease by the
Lenders and the interest rate on the Notes will be increased or decreased
accordingly pursuant to Section 1.2 hereof. The Company and the Noteholders
agree to cooperate with each other in connection with the execution and delivery
to the Noteholders of an amendment to this Agreement and to the Notes
incorporating such increase or decrease, as well as any related changes in any
other terms or conditions of the Credit Agreement.
8. EVENTS OF DEFAULT AND REMEDIES THEREFOR
8.1 Nature of Events.
An "Event of Default" shall exist if any one or more of the following occurs:
(a) Default in the payment of interest on any of the Notes which
continues for a period of three (3) days following the date such payment is due;
(b) Default in the payment of the principal of any of the Notes or the
premium thereon, if any, at maturity, upon acceleration of maturity or at any
date fixed for prepayment;
(c) Default shall occur (i) in the payment of the principal of,
premium, or interest on any other Indebtedness of the Company or its
Subsidiaries, aggregating in excess of $1,000,000 as and when due and payable
(whether by lapse of time, declaration, call for redemption or otherwise), (ii)
under any mortgage, agreement or other instrument of the Company or any
Subsidiary securing such Indebtedness or under or pursuant to which such
Indebtedness aggregating in excess of $1,000,000 is issued, (iii) under any
leases other than Capital Lease Obligations of the Company or any Subsidiary,
with aggregate Capital Lease Obligations in excess of $1,000,000 or (iv) with
respect to any combination of the foregoing involving Indebtedness and/or
Capital Lease Obligations aggregating in excess of $1,000,000 regardless of
whether such defaults would be Events of Default hereunder, and any such
defaults with respect to the payment of money shall continue, unless waived,
beyond the period of grace, if any, allowed with respect thereto;
(d) Default in the observance or performance of (i) any negative
covenant under Section 7 or (ii) any covenant under Sections 6.1(i), 6.1(m),
6.10, 6.16, 6.17 or 8.7;
(e) Default in the observance or performance of any other covenant or
provision of this Agreement which default is not remedied within thirty (30)
days after the earlier of the date (a) management of the Company knew of such
default or (b) on which written notice of such default is provided to the
Company by any Noteholder;
(f) Any representation or warranty made by the Company in this
Agreement or in any Security Document, or made by the Company in any written
statement or certificate furnished by the Company in connection with the
issuance and sale of the Notes or furnished by the Company pursuant to this
Agreement or in connection with any Security Document, or furnished by any
Subsidiary pursuant to any Subsidiary Guarantee or any Security Document to
which it is a party, or in any writing furnished in connection with the
transactions contemplated hereby, proves to have been false or incorrect in any
material respect as of the date of the issuance or making thereof;
(g) Any judgments, writs or warrants of attachment or any similar
processes individually or in the aggregate in excess of $1,500,000 shall be
entered or filed against the Company or any Subsidiary or against any property
or assets of either and remain unpaid, unvacated, unbonded or unstayed (through
appeal or otherwise) for a period of 60 days after the Company or any Subsidiary
receives notice thereof;
(h) The Company or any Subsidiary shall incur a "Distress Termination"
(as defined in Title IV of ERISA) of any Plan or any trust created thereunder
which results in material liability to the PBGC, the PBGC shall institute
proceedings to terminate any Plan or any trust created thereunder, or a trustee
shall be appointed by a United States District Court pursuant to Section 4042(b)
of ERISA to administer any Plan or any trust created thereunder;
(i) (A) Any Subsidiary Guarantor shall be in default of or fail to
comply with any term, covenant, or agreement contained in any Subsidiary
Guarantee or the Subsidiary Subordination Agreement or (B) any Subsidiary
Guarantee or the Subsidiary Subordination Agreement shall cease to be in full
force and effect;
(j) The Company or any Subsidiary shall
(i) generally not pay its debts as they become due or admit in
writing its inability to pay its debts generally as they become due;
(ii) file a petition in bankruptcy or for reorganization or
for the adoption of an arrangement under the Federal Bankruptcy Code,
or any similar applicable bankruptcy or insolvency law, as now or in
the future amended (herein collectively called "Bankruptcy Laws"), or
an answer or other pleading admitting or failing to deny the material
allegations of such a petition or seeking, consenting to or acquiescing
in relief provided for under the Bankruptcy Laws;
(iii) make an assignment of all or a substantial part of its
property for the benefit of its creditors;
(iv) seek or consent to or acquiesce in the appointment of a
receiver, liquidator, custodian or trustee of it or for all or a
substantial part of its property;
(v) be finally adjudicated a bankrupt or insolvent;
(vi) be subject to the entry of a court order, which shall not
be vacated, set aside or stayed within 30 days from the date of entry,
appointing a receiver, liquidator, custodian or trustee of it or for
all or a substantial part of its property, or entering of an order for
relief pursuant to an involuntary case, or effecting an arrangement in,
bankruptcy or for a reorganization pursuant to the Bankruptcy Laws or
for any other judicial modification or alteration of the rights of
creditors; or
(vii) be subject to the assumption of custody or sequestration
by a court of competent jurisdiction of all or a substantial part of
its property, which custody or sequestration shall not be suspended or
terminated within 30 days from its inception;
(k) The Company shall be in Default under the Credit Agreement, or the
Company shall breach any terms or provisions of the Credit Agreement or any
other document governing, evidencing or securing the Loans thereunder, including
any replacements, refundings, refinancings or additions of the foregoing;
(l) The Company shall be in Default in the observance or performance of
any covenant or agreement in the Security Documents beyond any applicable grace
period, or such Security Documents creating or granting a Lien on any collateral
shall cease to be in full force and effect;
(m) The Commitment shall at any time be less than an amount equal to
$275,000,000; or
(n) Any Subsidiary Guarantor shall be in default with respect to any
term, covenant or agreement contained in a Subsidiary Guarantee or (ii) the
Subsidiary Guarantee shall cease to be in full force and effect for any reason
or any Subsidiary Guarantor shall contest or deny in writing the validity or
enforceability of any of its obligations under a Subsidiary Guarantee.
8.2 Remedies on Default.
When any Event of Default described in paragraphs (a) through (i) and paragraphs
(k) through (n) of Section 8.1 has happened and is continuing, the holder or
holders of at least 25% in principal amount of the Notes then outstanding may by
notice to the Company declare the entire principal, together with the premium
set forth below, and all interest accrued on all Notes to be, and such Notes
shall thereupon become, forthwith due and payable, without any presentment,
demand, protest or other notice of any kind, all of which are expressly waived.
Notwithstanding the foregoing, when (i) any Event of Default described in
paragraphs (a) or (b) of Section 8.1 has happened and is continuing, any holder
may by notice to the Company declare the entire principal, together with the
premium set forth below, and all interest accrued on the Notes then held by such
holder to be, and such Notes shall thereupon become, forthwith due and payable,
without any presentment, demand, protest or other notice of
any kind, all of which are expressly waived and (ii) where any Event of Default
described in paragraph (j) of Section 8.1 has happened, then all outstanding
Notes shall immediately become due and payable without presentment, demand or
notice of any kind. Upon the Notes or any of them becoming due and payable as
aforesaid, the Company will forthwith pay to the holders of such Notes the
entire principal of and interest accrued on such Notes, plus a premium in the
event that the Reinvestment Yield shall, on the Determination Date, be less than
the interest rate payable on or in respect of the Notes. Such premium shall
equal (x) the aggregate present value of the principal so accelerated and the
aggregate present value of the interest which would have been payable in respect
of such principal absent such accelerated payment, determined by discounting
(semi-annually on the basis of a 360-day year composed of twelve 30-day months)
each such amount utilizing an interest factor equal to the Reinvestment Yield,
less (y) the principal amount to be accelerated.
8.3 Annulment of Acceleration of Notes.
The provisions of Section 8.2 are subject to the condition that if the principal
of and accrued interest on the Notes have been declared immediately due and
payable by reason of the occurrence of any Event of Default described in
paragraphs (a) through (i), inclusive, of Section 8.1, the holder or holders of
66-2/3% in aggregate principal amount of the Notes then outstanding may, by
written instrument furnished to the Company, rescind and annul such declaration
and the consequences thereof, provided that (i) at the time such declaration is
annulled and rescinded no judgment or decree has been entered for the payment of
any monies due pursuant to the Notes or this Agreement, (ii) all arrears of
interest upon all the Notes and all other sums payable under the Notes and under
this Agreement (except any principal, interest or premium on the Notes which has
become due and payable solely by reason of such declaration under Section 8.2)
and under the Subsidiary Guarantees shall have been duly paid and (iii) each and
every other Event of Default shall have been cured or waived; and provided
further, that no such rescission and annulment shall extend to or affect any
subsequent default or Event of Default or impair any right consequent thereto.
8.4 Other Remedies.
Subject to the provisions of Section 8.3, if any Event of Default shall be
continuing, any holder of Notes may enforce its rights by suit in equity, by
action at law, or by any other appropriate proceedings, whether for the specific
performance (to the extent permitted by law) of any covenant or agreement
contained in this Agreement, the Notes or the Subsidiary Guarantees or in aid of
the exercise of any power granted in this Agreement, and may enforce the payment
of any Note held by such holder and any of its other legal or equitable rights.
8.5 Conduct No Waiver; Collection Expenses.
No course of dealing on the part of any holder of Notes, nor any delay or
failure on the part of any holder of Notes to exercise any of its rights, shall
operate as a waiver of such rights or otherwise prejudice such holder's rights,
powers and remedies. If the Company fails to pay, when due, the principal of, or
the interest on, any Note, or fails to comply with any other provision of this
Agreement, the Company will pay to each holder, to the extent permitted by law,
on demand, such further amounts as shall be sufficient to cover the reasonable
cost and expenses, including but not limited to reasonable attorneys' fees,
incurred by such holders of the Notes in collecting any sums due on the Notes or
in otherwise enforcing any of their rights.
8.6 Remedies Cumulative.
No right or remedy conferred upon or reserved to any holder of Notes under this
Agreement or the Subsidiary Guarantees is intended to be exclusive of any other
right or remedy, and every right and remedy shall be cumulative and in addition
to every other right or remedy given under this Agreement or the Subsidiary
Guarantees or now or hereafter existing under any applicable law. Every right
and remedy given by this Agreement or by applicable law to any holder of Notes
may be exercised from time to time and as often as may be deemed expedient by
such holder, as the case may be.
8.7 Notice of Default.
With respect to Events of Default or claimed defaults, the Company will give the
following notices:
(a) The Company promptly will furnish to each holder of a Note notice
in writing by registered or certified mail, return receipt requested, of the
occurrence of an Event of Default or an event which, with the lapse of time or
the giving of notice, or both, would become an Event of Default. Such notice
shall specify the nature of such default, the period of existence thereof and
what action the Company has taken or is taking or proposes to take with respect
thereto.
(b) If the holder of any Note or of any other evidence of Indebtedness
of the Company or any Subsidiary gives any notice or takes any other action with
respect to a claimed default, the Company will forthwith give written notice to
the extent of the Company's knowledge thereof to each holder of the then
outstanding Notes, describing the notice or action and the nature of the claimed
default.
9. AMENDMENTS, WAIVERS AND CONSENTS
9.1 Matters Subject to Modification.
Any term, covenant, agreement or condition of this Agreement, the Notes, the
Subsidiary Guarantees and the Security Documents may, with the written consent
of the Company, be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), if the Company shall have obtained the consent in writing of the
holder or holders of at least 66-2/3% in aggregate principal amount of
outstanding Notes; provided, however, that, without the written consent of the
holder or holders of all of the Notes then outstanding, no such waiver,
modification, alteration or amendment shall be effective which will (i) change
the time of payment (including any required prepayment) of the principal of or
the interest on any Note, (ii) reduce the principal amount thereof or the
premium, if any, or reduce the rate of interest thereon, (iii) change any
provision of any instrument affecting the preferences between holders of the
Notes or between holders of the Notes and other creditors of the Company, or
(iv) change any of the provisions of Section 8.1, Section 8.2, Section 8.3 or
this Section 9.
Solely for the purpose of determining whether the holders of the requisite
percentage of the aggregate principal amount of Notes then outstanding approved
or consented to any amendment, waiver or consent to be given under this
Agreement, the Notes, any Subsidiary Guarantee or any Security Document, or have
directed the taking of any action provided herein any Subsidiary Guarantee, any
Security Document or in the Notes to be taken upon the direction of the holders
of a specified percentage of the aggregate principal amount of Notes then
outstanding, Notes directly or indirectly owned by the Company or any of its
Affiliates shall be deemed not to be outstanding.
9.2 Solicitation of Holders of Notes.
The Company will not solicit, request or negotiate for or with respect to any
proposed waiver or amendment of any of the provisions of this Agreement, the
Notes, the Subsidiary Guarantees or any Security Document unless each holder of
the Notes (irrespective of the amount of Notes then owned by it) shall
concurrently be informed thereof by the Company and shall be afforded the
opportunity of considering the same and shall be supplied by the Company with
sufficient information to enable it to make an informed decision with respect
thereto. The Company will pay all reasonable attorney fees and expenses incurred
by each holder of the Notes in connection with the review, evaluation and
documentation of any proposed amendment, waiver or consent in respect of any of
the provisions of this Agreement or of the Notes, the Subsidiary Guarantee or
the Security Documents. Executed or true and correct copies of any waiver or
consent effected pursuant to the provisions of this Section 9 shall be delivered
by the Company to each holder of outstanding Notes forthwith following the date
on which the same shall have been executed and delivered by the holder or
holders of the requisite percentage of outstanding Notes. The Company 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 holder of the
Notes as consideration for or as an
inducement to the entering into by any holder of the Notes of any waiver or
amendment of any of the terms and provisions of this Agreement, any Subsidiary
Guarantee or any Security Document unless such remuneration is concurrently
paid, on the same terms, ratably to each holder of the then outstanding Notes.
9.3 Binding Effect.
Any such amendment or waiver shall apply equally to all the holders of the Notes
and shall be binding upon them, upon each future holder of any Note and upon the
Company whether or not such Note shall have been marked to indicate such
amendment or waiver. No such amendment or waiver shall extend to or affect any
obligation not expressly amended or waived or impair any right related thereto.
10. FORM OF NOTES, REGISTRATION, TRANSFER, EXCHANGE AND REPLACEMENT
10.1 Form of Notes.
The Notes initially delivered under this Agreement will be in the form of five
fully registered Notes in the form attached as Exhibit A. The Notes are issuable
only in fully registered form and in denominations of at least $2,000,000 (or
the remaining outstanding balance thereof, if less than $2,000,000).
10.2 Note Register.
The Company shall cause to be kept at its principal office a register (the "Note
Register") for the registration and transfer of the Notes. The names and
addresses of the holders of Notes, the transfer thereof and the names and
addresses of the transferees of the Notes shall be registered in the Note
Register. The Company may deem and treat the person in whose name a Note is so
registered as the holder and owner thereof for all purposes and shall not be
affected by any notice to the contrary, until due presentment of such Note for
registration of transfer as provided in this Section 10.
10.3 Issuance of New Notes upon Exchange or Transfer.
Upon surrender for exchange or registration of transfer of any Note at the
office of the Company designated for notices in accordance with Section 11.2,
the Company shall execute and deliver, at its expense, one or more new Notes of
any authorized denominations requested by the holder of the surrendered Note,
each dated the date to which interest has been paid on the Notes so surrendered
(or, if no interest has been paid, the date of such surrendered Note), but in
the same aggregate unpaid principal amount as such surrendered Note, and
registered in the name of such person or persons as shall be designated in
writing by such holder. Every Note surrendered for registration of transfer
shall be duly endorsed, or be accompanied by a written instrument of transfer
duly executed, by the holder of such Note or by such holder's attorney duly
authorized in writing. The Company may condition its issuance of any new Note in
connection with a transfer by any Person on compliance by the transferee with
the representations required under Section 3.2, by Institutional Holders on
compliance with Section 2.5 and on the payment to the Company of a sum
sufficient to cover any stamp tax or other governmental charge imposed in
respect of such transfer.
10.4 Replacement of Notes.
Upon receipt of evidence satisfactory to the Company of the loss, theft,
mutilation or destruction of any Note, and in the case of any such loss, theft
or destruction upon delivery of a bond of indemnity in such form and amount as
shall be reasonably satisfactory to the Company or in the event of such
mutilation upon surrender and cancellation of the Note, the Company, without
charge to the holder thereof, will make and deliver a new Note, of like tenor in
lieu of such lost, stolen, destroyed or mutilated Note. If any such lost, stolen
or destroyed Note is owned by you or
any other Institutional Holder, then the affidavit of an authorized officer of
such owner setting forth the fact of loss, theft or destruction and of its
ownership of the Note at the time of such loss, theft or destruction shall be
accepted as satisfactory evidence thereof, and no further indemnity shall be
required as a condition to the execution and delivery of a new Note, other than
a written agreement of such owner (in form reasonably satisfactory to the
Company) to indemnify the Company.
11. MISCELLANEOUS
11.1 Expenses.
Whether or not the purchase of Notes herein contemplated shall be consummated,
the Company agrees to pay directly all reasonable expenses in connection with
the preparation, execution and delivery of this Agreement, the Notes, the
Subsidiary Guarantees, the Subsidiary Subordination Agreement, the Security
Documents, the Collateral Agency Agreement and the transactions contemplated by
each of the foregoing documents and agreements, including, but not limited to,
out-of-pocket expenses, filing fees of Standard & Poor's Ratings Group in
connection with obtaining a private placement number, charges and disbursements
of special counsel, photocopying and printing costs and charges for shipping the
Notes, adequately insured, to you at your home office or at such other address
as you may designate, and all similar expenses (including the reasonable fees
and expenses of counsel) relating to any amendments, waivers or consents in
connection with this Agreement, the Notes, the Subsidiary Guarantees, the
Subsidiary Subordination Agreement, the Security Documents or the Collateral
Agency Agreement or any agreement entered into by the Noteholders and the
Company or any Subsidiary Guarantor, including, but not limited to, any such
amendments, waivers or consents resulting from any work-out, renegotiation or
restructuring relating to the performance by the Company of its obligations
under this Agreement, the Security Documents and the Notes and the performance
by any Subsidiary Guarantor under any Subsidiary Guarantee, the Subsidiary
Subordination Agreement and any Security Document to which it is a party. The
Company also agrees that it will pay and save you harmless against any and all
liability with respect to stamp and other documentary taxes, if any, which may
be payable, or which may be determined to be payable in connection with the
execution and delivery of this Agreement, the Security Documents or the Notes
(but not in connection with a transfer of any Notes), whether or not any Notes
are then outstanding. The obligations of the Company under this Section 11.1
shall survive the retirement of the Notes.
11.2 Notices.
Except as otherwise expressly provided herein, all communications provided for
in this Agreement shall be in writing and delivered or sent by registered or
certified mail, return receipt requested, or by overnight courier (i) if to you,
to the address set forth below your name in Schedule I, or to such other address
as you may in writing designate, (ii) if to any other holder of the Notes, to
such address as the holder may designate in writing to the Company, and (iii) if
to the Company, to Oneida Ltd., 000-000 Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000,
Attention: Xxxxx X. Xxxxx, Chief Financial Officer, with a copy to Oneida Ltd.,
000-000 Xxxxxxx Xxxxxx, Xxxxxx, Xxx Xxxx 00000, Attention: General Counsel, or
to such other address as the Company may in writing designate.
11.3 Reproduction of Documents.
This Agreement and all documents relating hereto, including, without limitation,
(i) consents, waivers and modifications which may hereafter be executed, (ii)
documents received by you at the closing of the purchase of the Notes (except
the Notes themselves), and (iii) financial statements, certificates and other
information previously or hereafter furnished to you, may be reproduced by you
by any photographic, photostatic, microfilm, micro-card, miniature photographic
or other similar process, and you may destroy any original document so
reproduced. The Company agrees and stipulates that any such reproduction which
is legible shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and whether or not such reproduction was made by you in the regular
course of business) and that any enlargement, facsimile or further reproduction
of such reproduction shall likewise be admissible in evidence;
provided that nothing herein contained shall preclude the Company from objecting
to the admission of any reproduction on the basis that such reproduction is not
accurate, has been altered or is otherwise incomplete.
11.4 Successors and Assigns.
This Agreement will inure to the benefit of and be binding upon the parties
hereto and their respective successors and assigns.
11.5 Law Governing.
This Agreement shall be governed by and construed in accordance with the laws of
the State of Illinois. No provision of this Agreement may be waived, changed or
modified, or the discharge thereof acknowledged, orally, except by an agreement
in writing signed by the party against whom the enforcement of any waiver,
change, modification or discharge is sought.
11.6 Headings.
The headings of the sections and subsections of this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.
11.7 Counterparts.
This Agreement may be executed simultaneously in one or more counterparts, each
of which shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument, and it shall not be necessary in making
proof of this Agreement to produce or account for more than one such counterpart
or reproduction thereof permitted by Section 11.3.
11.8 Reliance on and Survival of Provisions.
All covenants, representations and warranties made by the Company herein and in
any certificates delivered pursuant to this Agreement, whether or not in
connection with a closing, (i) shall be deemed to have been relied upon by you,
notwithstanding any investigation heretofore or hereafter made by you or on your
behalf and (ii) shall survive the delivery of this Agreement and the Notes.
11.9 Integration and Severability.
This Agreement embodies the entire agreement and understanding between you and
the Company, and supersedes all prior agreements and understandings relating to
the subject matter hereof. In case any one or more of the provisions contained
in this Agreement or in any Note, or application thereof, shall be invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained in this Agreement and in
any Note, and any other application thereof, shall not in any way be affected or
impaired thereby.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the Company and the Purchasers have caused this
Agreement to be executed and delivered by their respective officer or officers
thereunto duly authorized.
ONEIDA LTD.
By: /s/ XXXXX X. XXXXX
-------------------
Name: Xxxxx X. Xxxxx
Title: Chief Financial Officer
ALLSTATE LIFE INSURANCE COMPANY
By: /s/ XXXXXXXX X. XXXXXX
-----------------------
By: /s/ XXXXXX X. XXXXXXXX
-----------------------
Authorized Signatories
PACIFIC LIFE INSURANCE COMPANY
By: /s/ XXXXX X. OALES
-------------------
Title: Assistant Vice President
By: /s/ XXXXX X. XXXX
-----------------
Title: Assistant Secretary
SCHEDULE I
Principal Amount of Notes to be Purchased
Name and Address of Purchaser Principal Amount of Notes
--------------------------------------------------------------------------------
Allstate Life Insurance Company $10,000,000
Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Investment Department -
Private Placement Division J2A
Address for all communications is as above. All payments are to be by bank wire
transfer of immediately available funds to:
Xxxxxx Trust and Savings Bank
ABA No. 0000-0000-0
Xxxxxxx, XX 00000
Attn: Trust Collection Dept. 5C
Custody Account #23-80522
PPN: 682505 B# 8
Each wire transfer shall identify such payment as "Oneida Ltd., Senior Notes due
January 15, 2002."
Tax ID #00-0000000
SCHEDULE I
Principal Amount of Notes to be Purchased
Name and Address of Purchaser Principal Amount of Notes
--------------------------------------------------------------------------------
Allstate Life Insurance Company $5,000,000
Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Investment Department -
Private Placement Division J2A
Address for all communications is as above. All payments are to be by bank wire
transfer of immediately available funds to:
Xxxxxx Trust and Savings Bank
ABA No. 0000-0000-0
Xxxxxxx, XX 00000
Attn: Trust Collection Dept. 5C
Custody Account #23-83531
PPN: 682505 B# 8
Each wire transfer shall identify such payment as "Oneida Ltd., Senior Notes due
January 15, 2002."
Tax ID #00-0000000
SCHEDULE I
Principal Amount of Notes to be Purchased
Name and Address of Purchaser Principal Amount of Notes
--------------------------------------------------------------------------------
Allstate Life Insurance Company $5,000,000
Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Investment Department -
Private Placement Division J2A
Address for all communications is as above. All payments are to be by bank wire
transfer of immediately available funds to:
Xxxxxx Trust and Savings Bank
ABA No. 0000-0000-0
Xxxxxxx, XX 00000
Attn: Trust Collection Dept. 5C
Custody Account #23-80524
PPN: 682505 B# 8
Each wire transfer shall identify such payment as "Oneida Ltd., Senior Notes due
January 15, 2002."
Tax ID #00-0000000
SCHEDULE I
Principal Amount of Notes to be Purchased
Name and Address of Purchaser Principal Amount of Notes
--------------------------------------------------------------------------------
Pacific Life Insurance Company $5,000,000
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Securities Department
Address for all communications is as above, except notices of payment and
written confirmations of wire or inter-bank transfers. All payments are to be by
bank wire transfer of immediately available funds to:
For Payment of Principal & Interest:
Federal Reserve Bank of Boston
ABA# 0000-0000-0/BOS SAFE DEP
DDA 125261
Attn: MBS Income CC: 1253
A/C Name: Pacific Life General Account/PLCF1810132
Each wire transfer shall identify such payment as "Oneida Ltd., Senior Notes due
January 15, 2002."
Notices of payment and written confirmations of wire or inter-bank transfers
shall be addressed to:
Mellon Trust
Attn: Pacific Life Accounting Team
Xxx Xxxxxx Xxxx Xxxxxx
Xxxx 0000
Xxxxxxxxxx, XX 00000-0000
And
Pacific Life Insurance Company
Attn: Securities Administration - Cash Team
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000-0000
All securities being purchased should be registered in the nominee name of "Mac
& Co." and delivered to:
Mellon Securities Trust Company
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxx 212.374.1918
A/C Name: Pacific Life General Acct
A/C#: PLCF1810132
Tax ID #00-0000000
SCHEDULE I
Principal Amount of Notes to be Purchased
Name and Address of Purchaser Principal Amount of Notes
--------------------------------------------------------------------------------
Pacific Life Insurance Company $5,000,000
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Fixed Income Securities Dept.
Address for all communications is as above, except notices of payment and
written confirmations of wire or inter-bank transfers. All payments are to be by
bank wire transfer of immediately available funds to:
For Payment of Principal & Interest:
Federal Reserve Bank of Boston
ABA# 0000-0000-0/BOS SAFE DEP
DDA 125261
Attn: MBS Income CC: 1253
A/C Name: Pacific Life General Account/PLCF1810132
Each wire transfer shall identify such payment as "Oneida Ltd., Senior Notes due
January 15, 2002."
Notices of payment and written confirmations of wire or inter-bank transfers
shall be addressed to:
Mellon Trust
Attn: Pacific Life Accounting Team
Xxx Xxxxxx Xxxx Xxxxxx
Xxxx 0000
Xxxxxxxxxx, XX 00000-0000
And
Pacific Life Insurance Company
Attn: Securities Administration - Cash Team
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000-0000
All securities being purchased should be registered in the nominee name of
"EBENCO" and delivered to:
Mellon Securities Trust Company
000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxx 212.374.1918
A/C Name: Pacific Life General Acct
A/C#: PLCF1810132
Tax ID #00-0000000
SCHEDULE 6.01(a)
BORROWED MONEY
Oneida Ltd.
USD $2,000,000 presently outstanding and owed to Alliance Bank under a USD
$2,000,000 line of credit
USD $4,285,714 owed under 8.52% Senior Notes due 1/15/02 issued pursuant to a
Note Agreement dated as of January 1, 1992
USD $1,500,000 presently outstanding and owed to Oneida Savings Bank under a
USD$3,000,000 line of credit
USD $2,500,000 line of credit with the Chase Manhattan Bank of which no
indebtedness presently is outstanding
Buffalo China, Inc.
USD $185,526 owed to NYS Urban Development Corporation under a loan
Delco International, Ltd.
None
Encore Promotions, Inc.
None
Sakura, Inc.
None
THC Systems, Inc.
USD 31,100,000 owed under 7.49% Senior Notes due 11/1/08 issued pursuant to a
Note Agreement dated as of November 15, 1996
1
SCHEDULE 6.01(b)
GUARANTEES
Irrevocable Letter of Credit
#SPC 32421
Issued: 1/8/92 by Chase
Amount: $86,760
In Favor of: McGilroy Ltd. Partnership
For Account of: KSCI
Payable: on presentation of original Letter of Credit & statement that KSCI has
defaulted under its (factory outlet store) lease with McGilroy
Issued by HSBC Bank USA
$2,500,000
In favor of The Hong Kong and Shanghai Banking Corporation, Ltd.
Purpose: to guarantee borrowing by Shanghai Premium Tableware Manufacturing Co.
Ltd., A wholly owned subsidiary of Oneida International, Inc.
Guarantee Agreements-
Buffalo China, Inc. in favor of the Purchasers pursuant to the November 26, 1996
Note Agreement.
Oneida Ltd. in favor of the Purchasers pursuant to the November 26, 1996 Note
Agreement.
Oneida Ltd. in favor of HSBC with respect to borrowing by Oneida Australia Pty
Ltd. dated May 1998.
Oneida Ltd. in favor of Banca Nazionale del Lavoro with respect to borrowings by
Oneida Italy, Srl. Dated November 1999.
2
SCHEDULE 6.01(c)
CAPITAL LEASES
Oneida Ltd.
1. IBM Credit Corporation
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Equipment Covered: Various Computer Equipment
Lease Date: March 2001
Lease Term: 36
Each Lease Payment: $4,550.00/month
2. Toyota Motor Credit Corporation
Commercial Finance Division
0000 Xxxx 000xx Xxxxxx
Xxxxx 000
Xxxxxxx, XX 00000-0000
a. Equipment Covered: Three (3) Fork Lift Trucks
Lease Date: May 10, 1999
Lease Term: 60 months
Each Lease Payment: $797.25/month
b. Equipment Covered: Two (2) Fork Lift Trucks
Lease Date: May 10, 1999
Lease Term: 60 months
Each Lease Payment: $531.50/month
c. Equipment Covered: One (1) Fork Lift Truck
Lease Date: October 27, 1999
Lease Term: 36 months
Each Lease Payment: $265.00/month
d. Equipment Covered: One (1) Fork Lift Truck
Lease Date: October 27, 1999
Lease Term: 60 months
Each Lease Payment: $314.00/month
3
e. Equipment Covered: One (1) Fork Lift Truck
Lease Date: September 28, 2000
Lease Term: 60 months
Each Lease Payment: $297.61/month
3. Xxxxx Leasing Company
0000 Xxxxxxxx Xxxx Xxxxx
X.X. Xxx 0000
Xxx Xxxxx, XX 00000-0000
Equipment Covered: Various Copier Equipment
Lease Date: June 30, 1999
Lease Term: 63 months
Each Lease Payment: $5,204.48/month
4. Ameritech Credit Corporation
d/b/a Ameritech Capital Services
0000 Xxxx Xxxx Xxxx
Xxxxxxx Xxxxxxx, XX 00000
Equipment Covered: Securitylink Security System
Lease Date: June 1999
Lease Term: 60 months
Each Lease Payment: $364.00
5. IOS (IKON Office Solutions) Capital, Inc.
X.X. Xxx 0000
Xxxxx, XX 00000-0000
Equipment Covered: One (1) Copier and Finisher
Lease Date: September 27, 2000
Lease Term: 60 months
Each Lease Payment: Months 1-12: $630.62/month
Months 13-60: $1,056.62/month
6. USBancorp.
000 Xxxx Xxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Equipment Covered: One (1) Copier
Lease Date: March 2001
Lease Term: 42 months
Each Lease Payment: $210.00/month
7. NMHG Financial Services, Inc.
X.X. Xxx 000X
Xxxxxxx, XX 00000
Equipment Covered: Three (3) Lift Trucks
Lease Date: March 1, 2000
Lease Term: 60 months
Each Lease Payment: $841.01/month
8. V.T., Inc., as Trustee of World Omni Financial Corp.
X.X. Xxx 0000
Xxxxxxxxx, XX 00000-0000
Equipment Covered: 2000 Jeep Grand Cherokee
Lease Date: August 25, 2000
Lease Term: 36 months
Each Lease Payment: $312.45/month
4
Buffalo China, Inc.
1. NMHG Financial Services, Inc.
X.X. Xxx 000X
Xxxxxxx, XX 00000
Equipment Covered: One (1) Motorized Hand Truck
Lease Date: May 30, 2000
Lease Term: 60 months
Each Lease Payment: $166.05/month
2. Xxxxxx Handling, Inc.
0000 Xxxx Xxxx
Xxxxxxx, XX 00000
Equipment Covered: Four (4) Reach Trucks
Lease Date: September 5, 2000
Lease Term: 60 months
Each Lease Payment: $1,086.14/month
5
Delco International, Ltd.
1. Pitney Xxxxx Credit Corporation
0 Xxxxxxxx Xxxx
Xxxxxxxx, XX 0000-0000
Equipment Covered: One (1) Postage Meter
Lease Date: December 8, 1999
Lease Term: 63 months
Each Lease Payment: $455.00/month
2. Chase Equipment Leasing, Inc.
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Equipment Covered: Three (3) Fork Lift Trucks
Lease Date: April 6, 1998
Lease Term: -
Each Lease Payment: $1525.57/month
3. Toyota Motor Credit Corporation
X.X. Xxx 0000
Xxxxxxxx, XX 00000-0000
Equipment Covered: Fork Lift Truck(s)
Lease Date: -
Lease Term: -
Each Lease Payment: $415.21/month
4. IBM Credit Corporation
0 Xxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000-0000
Equipment Covered: Various computer equipment
Lease Date: October 2, 1998
Lease Term: -
Each Lease Payment: $1,040.00/month
5. Xerox
Equipment Covered: Copier
Lease Date: -
Lease Term: -
Each Lease Payment: approx. $250.00/month
Encore Promotions, Inc.
1. Pitney Xxxxx Credit Corporation
0 Xxxxxxxx Xxxx
Xxxxxxxx, XX 0000-0000
Equipment Covered: One (1) Postage Meter
Lease Date: January 19, 2001
Lease Term: 48 months
Each Lease Payment: $145.00/month
6
Sakura, Inc.
1. Leasecomm Corporation
000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Equipment Covered: Linkpoint 3000 printer
Lease Date: none
Lease Term: 48 months
Each Lease Payment: $39.99/month
2. MCS Canon Business Solution, Inc.
Equipment Covered: One (1) copier
Lease Date: September 25, 1998
Lease Term: 36 months
Each Lease Payment: $665.23/month
3. Minolta Business Solutions
Xxx Xxxxxxxxxxxxx Xxxx. 00xx Xxxxx
Xxxxxx, XX 00000-0000
Equipment Covered: One (1) color copier
Lease Date: May 1, 2000
Lease Term: 36
Each Lease Payment: $745.00/month
THC Systems, Inc.
None
7
ANNEX I
Subsidiary Guarantors of the Company and Jurisdictions where each Subsidiary
Guarantor is Qualified to do Business as a Foreign Corporation
% OWNED BY
SUBSIDIARY GUARANTOR STATES COMPANY
1. Buffalo China, Inc. California 100%
2. Delco International, Ltd. None 100%
3. Encore Promotions, Inc. None 100%
4. Sakura, Inc. California 100%
(qualified as "Oneida-Sakura Inc.")
New Jersey
(qualified as "Oneida-Sakura, Inc.")
5. THC Systems, Inc. North Carolina 100%
1
ANNEX II
Existing Indebtedness
a) Borrowed Money - See attached Schedule 6.01(a)
b) Guaranties - See attached Schedule 6.01(b)
c) Borrowed Money Secured by Lien - See attached Schedule 6.01(c)
2
ANNEX III
Description of Liens
3
ANNEX IV
Schedule of Insurance
4
ANNEX V
Restrictions
5
EXHIBIT A
ONEIDA LTD.
SENIOR SECURED NOTE
Due January 15, 2002
--------------------
THIS NOTE MAY BE SUBJECT TO A HOME OFFICE PAYMENT AGREEMENT AND
ACCORDINGLY ANY PROSPECTIVE PURCHASER SHOULD FIRST VERIFY THE UNPAID PRINCIPAL
AMOUNT WITH THE COMPANY.
THIS NOTE IS ISSUED IN SUBSTITUTION FOR AND IN REPLACEMENT OF THAT
SENIOR NOTE DUE JANUARY 15, 2002 AS AMENDED AND RESTATED AS OF NOVEMBER 1, 2000
ISSUED BY ONEIDA LTD.
--------------------
Registered Note No. R-__ April 27, 2001
$
-------------------
ONEIDA LTD., a New York corporation (the "Company"), for value
received, hereby promises to pay to the order of ________________, or registered
assigns, on the fifteenth day of January, 2002, the principal amount of
___________ Dollars ($________) and to pay interest (computed on the basis of a
360-day year of twelve 30-day months) on the principal amount from time to time
remaining unpaid hereon at the rate of:
(i) 8.52% per annum commencing July 15, 1992 up to and including September 11,
2000;
(ii) 9.02% per annum commencing September 12, 2000 up to and including December
13, 2000;
(iii) 9.52% per annum commencing December 14, 2000 up to and including April 27,
2001;
(iv) 9.87% per annum from April 28, 2001 until the earlier of:
(a) the date or dates, as the case may be, of any increase in
the Level in which case the rate of interest will increase on such date
to an amount equal to the sum of the then existing interest rate plus
the amount of such increase in the Level; or
(b) the date or dates, as the case may be, of a decrease in
the Level in which case the rate of interest will decrease on such date
to an amount equal to the then existing interest rate minus the amount
of such decrease in the Level, provided that (i) in no event shall the
interest rate fall below 8.52% and (ii) the Company provides evidence
to the Noteholders satisfactory to the Noteholders that: (1) the
Lenders have not received further compensation in any form as a result
of any such reduction in the Level, (2) the Consolidated Leverage Ratio
is, as of the last day of the immediately preceding Fiscal Quarter, in
compliance with Section 7.12 of the Note Agreement (as hereinafter
defined) and (3) no Event of Default exists, or
(c) maturity; and
(v) Notwithstanding the foregoing, if the amount of capital required to be
maintained by the Noteholders in respect of the Notes is increased as a result
of a Change in Capital (as defined below), the interest rate then in effect on
the Notes shall be increased by 0.50% (50 basis points) effective as of the date
on which such increase in required capital is effective. The Noteholders agree
to notify the Company of such increase and the date on which such increase
becomes effective, promptly after learning of such increase in required capital.
As used herein, "Change in Capital" means any change after the date of this
Agreement that increases the risk-based capital factor
1
attributable to the Notes as mandated by the risk-based capital guidelines for
life and health insurance companies in effect in the United States on the date
of this Agreement.
All such interest payments shall be payable quarterly on the fifteenth
day of January, April, July and October of each year, commencing July 15, 1992,
and at maturity and shall bear interest on overdue principal (including any
overdue required or optional prepayment), premium, if any, and (to the extent
legally enforceable) on any overdue installment of interest at the greater of
(a) the rate of interest publicly announced by The Chase Manhattan Bank (or its
successors or assigns) as its "prime rate" plus one percent (1%) or (b) the sum
of the rate of interest then in effect plus two percent (2%) per annum after
maturity or the due date thereof, whether by acceleration or otherwise, until
paid, to be expressed to mature on January 15, 2002. Payments of the principal
of, the premium, if any, and interest on this Note shall be made in lawful money
of the United States of America in the manner and at the place provided in
Section 2.5 of the Note Agreement hereinafter defined.
This Note is issued under and pursuant to the terms and provisions of
that certain Note Agreement dated as of January 1, 1992, as amended by that
certain Amended and Restated Note Purchase Agreement dated as of January 1,
1992, and as further amended by that 2001 Amended and Restated Note Purchase
Agreement dated as of May 31, 2001, entered into by the Company with the
Noteholders named in Schedule I thereto (collectively, as the same may from time
to time be amended, restated, supplemented or modified, the "Note Agreement"),
and this Note and any holder hereof are entitled to all of the benefits and are
bound by the terms provided for by such Note Agreement or referred to therein.
The provisions of the Note Agreement are incorporated in this Note to the same
extent as if set forth at length herein. All defined terms used herein shall
have the meanings assigned to such terms in the Note Agreement.
As provided in the Note Agreement, upon surrender of this Note for
registration of transfer, duly endorsed or accompanied by a written instrument
of transfer duly executed by the registered holder hereof or his attorney duly
authorized in writing, a new Note for a like unpaid principal amount will be
issued to, and registered in the name of, the transferee upon the payment of the
taxes or other governmental charges, if any, that may be imposed in connection
therewith. The Company may treat the person in whose name this Note is
registered as the owner hereof for the purpose of receiving payment and for all
other purposes, and the Company shall not be affected by any notice to the
contrary.
This Note may be declared due prior to its expressed maturity date,
voluntary prepayments may be made hereon and certain prepayments are required to
be made hereon all in the events, on the terms and in the manner as provided in
the Note Agreement. Such prepayments include certain required prepayments on
January 15 of each year beginning January 15, 1996 and ending January 15, 2001
and certain optional prepayments with a premium.
Should the indebtedness represented by this Note or any part thereof be
collected in any proceeding provided for in the Note Agreement or be placed in
the hands of attorneys for collection, the Company agrees to pay, in addition to
the principal, premium, if any, and interest due and payable hereon, all
reasonable costs of collecting this Note, including reasonable attorneys' fees
and expenses.
This Note is secured pursuant to the terms of certain Security
Documents and Subsidiary Guarantees and a Noteholder's rights hereunder are
subject to the terms of a Collateral Agency Agreement with certain other lenders
to the Company.
2
This Note and the Note Agreement are governed by and construed in
accordance with the laws of the State of Illinois.
ONEIDA LTD.
By:
----------------------------
Its:
3
EXHIBIT B
LEGAL OPINIONS
A. The opinion of Xxxxxxx, Carton & Xxxxxxx, special counsel for the
Purchasers, shall be to the effect that:
1. The Company is a corporation organized and validly existing in good
standing under the laws of the State of New York, with all requisite corporate
power and authority to carry on its business as now conducted, to enter into and
perform the Agreement and to issue and sell the Notes.
2. The Agreement has been duly authorized by proper corporate action on
the part of the Company, has been duly executed and delivered by an authorized
officer of the Company and constitutes the legal, valid and binding agreement of
the Company, enforceable in accordance with its terms, except to the extent that
enforcement of the Agreement may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws of general application
relating to or affecting the enforcement of the rights of creditors or by
equitable principles, regardless of whether enforcement is sought in a
proceeding in equity or at law.
3. The Notes have been duly authorized by proper corporate action on
the part of the Company, have been duly executed and delivered by an authorized
officer of the Company and constitute the legal, valid and binding obligations
of the Company, enforceable in accordance with their terms, except to the extent
that enforcement of the Notes may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws of general application
relating to or affecting the enforcement of the rights of creditors or by
equitable principles, regardless of whether enforcement is sought in a
proceeding in equity or at law.
4. Based upon the representations set forth in the Agreement, the
offering, sale and delivery of the Notes do not require the registration of the
Notes under the Securities Act of 1933, as amended, nor the qualification of an
indenture under the Trust Indenture Act of 1939, as amended.
5. The issuance and sale of the Notes and compliance with the terms and
provisions of the Notes and the Agreement will not conflict with or result in
any breach of any of the provisions of the Certificate of Incorporation or
By-Laws of the Company.
The opinion of Xxxxxxx, Carton & Xxxxxxx also shall state that the opinion of
Shearman & Sterling, counsel for the Company, delivered to you pursuant to the
Agreement, is satisfactory in form and scope to Xxxxxxx, Carton & Xxxxxxx, and,
in their opinion, the Purchasers and it are justified in relying thereon and
shall cover such other matters relating to the sale of the Notes as the
Purchasers may reasonably request. Xxxxxxx, Carton & Xxxxxxx may rely, as to
matters of New York law, on the opinion of Shearman & Sterling.
B. The opinion of Shearman & Sterling, counsel for the Company, shall
cover all matters specified in clauses 1 through 6 set forth above and also
shall be to the effect that:
1. The Company has full corporate power and authority to conduct the
activities in which it is now engaged and own its property.
2. Each Subsidiary of the Company is a corporation duly organized and
validly existing in good standing under the laws of its jurisdiction of
incorporation, and each has all requisite corporate power and authority to carry
on its business as now conducted and own its property.
3. Each of the Company and its Subsidiaries is duly qualified or
licensed and in good standing as a foreign corporation authorized to do business
in each jurisdiction where the nature of the business transacted by it or the
character of its properties owned or leased makes such qualification or
licensing necessary except where failure to so qualify would not, individually
or in the aggregate, have a material adverse affect on its business, properties,
or condition, financial or otherwise.
1
Exhibit B
4. No authorization, approval or consent of any governmental or
regulatory body is necessary or required in connection with the lawful execution
and delivery by the Company of the Agreement or the lawful offering, issuance
and sale of the Notes, and no designation, filing, declaration, registration
and/or qualification with any governmental authority is required by the Company
in connection with such offer, issuance and sale.
5. The issuance and sale of the Notes and the execution, delivery and
performance by the Company of the Agreement will not conflict with, or result in
any breach or violation of any of the provisions of, or constitute a default
under, or result in the creation of any Lien on the property of the Company or
any Subsidiary pursuant to, (i) the provisions of the Certificate of
Incorporation or other charter document or by-laws of the Company or any
Subsidiary or any loan agreement under which the Company or any Subsidiary is
bound, or other agreement or instrument known to such counsel (after due
inquiry) to which the Company or any Subsidiary is a party or by which any of
them or their property is bound or (ii) any New York law (including usury laws)
or regulation, order, writ, injunction or decree of any court or governmental
authority applicable to the Company known to such counsel.
6. There are no actions, suits or proceedings pending or, to the best
of such counsel's knowledge after due inquiry, threatened against, or affecting
the Company or its Subsidiaries, at law or in equity or before or by any
Federal, state, municipal or other governmental department, commission, board,
bureau, agency or instrumentality, domestic or foreign, which are likely to
result, either individually or in the aggregate, in any material adverse change
in the business, properties, operations or condition, financial or otherwise, of
the Company and its Subsidiaries taken as a whole.
7. All of the issued and outstanding shares of capital stock of each
Subsidiary have been duly and validly issued, are fully paid and nonassessable
and, to the knowledge of such counsel, are owned by the Company free and clear
of any Lien.
8. The issuance of the Notes and the use of the proceeds of the sale of
the Notes do not violate or conflict with Regulation G, T, U or X of the Board
of Governors of the Federal Reserve System (12 C.F.R., Chapter II).
9. Neither the Company nor any Subsidiary is: (i) a "public utility
company" or a "holding company," or an "affiliate" or a "subsidiary company" of
a "holding company," or an "affiliate" of such a "subsidiary company," as such
terms are defined in the Public Utility Holding Company Act of 1935, as amended,
or (ii) a "public utility" as defined in the Federal Power Act, as amended, or
(iii) an "investment company" or an "affiliated person" thereof or an
"affiliated person" of any such "affiliated person," as such terms are defined
in the Investment Company Act of 1940, as amended.
The opinion of Shearman & Sterling shall cover such other matters relating to
the sale of the Notes as the Purchasers may reasonably request. With respect to
matters of fact on which such opinion is based, such counsel shall be entitled
to rely on appropriate certificates of public officials and officers of the
Company and with respect to matters governed by the laws of any jurisdiction
other than the United States of America and the State of New York, such counsel
may rely upon the opinions of counsel deemed (and stated in their opinion to be
deemed) by them to be competent and reliable.
2
Exhibit B
EXHIBIT C
SECURITY AGREEMENT
EXHIBIT D
AMENDED AND RESTATED SUBSIDIARY
SUBORDINATION AGREEMENT
EXHIBIT E
AMENDED AND RESTATED SUBSIDIARY
GUARANTEE AGREEMENT
EXHIBIT F
PLEDGE AGREEMENT
