1
EXHIBIT 4.6
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CREDIT AGREEMENT
Dated as of October 7, 1999
among
FLOWSERVE CORPORATION
BANK OF AMERICA, N.A.
as Administrative Agent,
and as
Letter of Credit Issuing Bank
BANK ONE, TEXAS, NA
as Syndication Agent
ABN AMRO BANK N.V.
as Documentation Agent
and
THE OTHER FINANCIAL
INSTITUTIONS PARTY HERETO
BANC OF AMERICA SECURITIES LLC
BANC ONE CAPITAL MARKETS, INC.
Lead Arrangers and Book Managers
ABN AMRO BANK N.V.
Book Manager
[LOGO]
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TABLE OF CONTENTS
PAGE
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 Defined Terms...........................................................................................1
1.2 Use of Defined Terms...................................................................................22
1.3 Accounting Terms.......................................................................................22
1.4 Rounding...............................................................................................23
1.5 Exhibits and Schedules.................................................................................23
1.6 References to "Borrower and its Subsidiaries"..........................................................23
1.7 Miscellaneous Terms....................................................................................23
1.8 Dollar Equivalent Amounts..............................................................................23
SECTION 2
COMMITMENTS; INTEREST, FEES, PAYMENT PROCEDURES
2.1 Committed Loans........................................................................................23
2.2 Borrowings, Conversions and Continuations of Loans.....................................................26
2.3 Letters of Credit......................................................................................27
2.4 Prepayments............................................................................................31
2.5 Mandatory and Voluntary Reduction or Termination of Tranche A and Tranche B Commitments................32
2.6 Optional Increase of the Tranche A and Tranche B Commitments...........................................32
2.7 Principal and Interest.................................................................................34
2.8 Fees...................................................................................................35
2.9 Computation of Interest and Fees.......................................................................36
2.10 Manner and Treatment of Payments among the Banks, Borrower and the Administrative Agent................36
2.11 Funding Sources........................................................................................37
2.12 Extension of Tranche A and Tranche B Maturity Dates....................................................37
SECTION 3
TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 Taxes..................................................................................................39
3.2 Increased Costs........................................................................................39
3.3 Capital Adequacy.......................................................................................39
3.4 Illegality.............................................................................................39
3.5 Inability to Determine Rates...........................................................................40
3.6 Breakfunding Costs.....................................................................................40
3.7 Matters Applicable to all Requests for Compensation....................................................40
(Credit Agreement)
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 4
CONDITIONS
4.1 Initial Extension of Credit............................................................................41
4.2 Any Extension of Credit................................................................................42
SECTION 5
REPRESENTATIONS AND WARRANTIES
5.1 Due Incorporation, Etc.................................................................................43
5.2 Authorization of Borrowing, Etc........................................................................43
5.3 Financial Condition....................................................................................44
5.4 Absence of Litigation; Litigation Description..........................................................44
5.5 Payment of Taxes.......................................................................................44
5.6 Governmental Regulation................................................................................45
5.7 Not a Purpose Credit...................................................................................45
5.8 ERISA..................................................................................................45
5.9 Disclosure.............................................................................................45
5.10 Insurance..............................................................................................46
5.11 Environmental Matters..................................................................................46
5.12 Performance of Agreements..............................................................................46
5.13 Solvency...............................................................................................47
5.14 Year 2000..............................................................................................47
SECTION 6
AFFIRMATIVE COVENANTS
6.1 Reporting Requirements.................................................................................47
6.2 Certificates, Notices and Other Information............................................................48
6.3 Material Subsidiary Guaranty...........................................................................49
6.4 Corporate Existence, Etc...............................................................................49
6.5 Access and Visitation Rights...........................................................................49
6.6 Payment of Taxes, Etc..................................................................................50
6.7 Maintenance of Properties, Etc.........................................................................50
6.8 Compliance with Laws, Etc..............................................................................50
6.9 Maintenance of Insurance...............................................................................50
6.10 Employment of Technology, Disposal of Hazardous Waste, Etc.............................................50
6.11 Keeping of Books, Etc..................................................................................51
6.12 Further Assurances.....................................................................................51
6.13 Use of Proceeds........................................................................................51
6.14 Year 2000 Compliance...................................................................................51
(Credit Agreement)
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 7
NEGATIVE COVENANTS
7.1 Debt...................................................................................................51
7.2 Liens and Related Matters..............................................................................53
7.3 Negative Pledges; Restrictions on Dividends, Etc.......................................................54
7.4 Investments and Acquisitions...........................................................................54
7.5 Contingent Obligations.................................................................................55
7.6 Restrictions on Fundamental Changes....................................................................57
7.7 Financial Covenants....................................................................................57
7.8 Dividends, Etc.........................................................................................58
7.9 Change in Business.....................................................................................58
7.10 ERISA..................................................................................................58
7.11 Charter and Bylaws.....................................................................................59
7.12 Transactions with Shareholders and Affiliates..........................................................59
7.13 Receivables Program....................................................................................59
7.14 Non-Guarantor Subsidiaries.............................................................................59
SECTION 8
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
8.1 Events of Default......................................................................................59
8.2 Remedies Upon Event of Default.........................................................................61
SECTION 9
THE ADMINISTRATIVE AGENT
9.1 Appointment and Authorization; "Administrative Agent"..................................................63
9.2 Delegation of Duties...................................................................................64
9.3 Liability of Administrative Agent......................................................................64
9.4 Reliance by Administrative Agent.......................................................................64
9.5 Notice of Default......................................................................................65
9.6 Credit Decision........................................................................................65
9.7 Indemnification of Administrative Agent................................................................65
9.8 Administrative Agent in Individual Capacity............................................................66
9.9 Successor Administrative Agent.........................................................................66
9.10 Syndication Agent, Documentation Agent, etc............................................................67
(Credit Agreement)
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TABLE OF CONTENTS
(CONTINUED)
PAGE
SECTION 10
MISCELLANEOUS
10.1 Cumulative Remedies; No Waiver.........................................................................67
10.2 Amendments; Consents...................................................................................67
10.3 Attorney Costs, Expenses and Taxes.....................................................................68
10.4 Nature of Banks' Obligations...........................................................................68
10.5 Survival of Representations and Warranties.............................................................69
10.6 Notices................................................................................................69
10.7 Execution of Loan Documents............................................................................69
10.8 Binding Effect; Assignment.............................................................................70
10.9 Right of Setoff........................................................................................71
10.10 Sharing of Setoffs.....................................................................................71
10.11 Indemnity by Borrower..................................................................................72
10.12 Nonliability of the Banks..............................................................................72
10.13 No Third Parties Benefited.............................................................................73
10.14 Confidentiality........................................................................................73
10.15 Further Assurances.....................................................................................74
10.16 Integration............................................................................................74
10.17 Failure to Charge Not Subsequent Waiver................................................................74
10.18 Governing Law..........................................................................................74
10.19 Severability of Provisions.............................................................................74
10.20 Headings...............................................................................................74
10.21 Time of the Essence....................................................................................75
10.22 Foreign Banks and Participants.........................................................................75
10.23 Removal of a Bank......................................................................................75
10.24 Waiver of Right to Trial by Jury.......................................................................76
10.25 Purported Oral Amendments..............................................................................76
10.26 Judgment...............................................................................................76
(Credit Agreement)
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EXHIBITS
Form of
A Request for Extension of Credit
B Compliance Certificate
C-1 Tranche A Loan Note
C-2 Tranche B Loan Note
C-3 Swing Line Note
D Notice of Assignment and Acceptance
E Material Subsidiary Guaranty
F Increased Commitment Acceptance
G New Commitment Acceptance
H Subordination Provisions
I Opinion of Counsel
J Opinion of Administrative Agent's Counsel
SCHEDULES
2.1 Commitments and Pro Rata Shares
5.1 Subsidiaries
7.1 Existing Debt, Existing Letters of Credit and Surety and
Performance Bonds
7.4 Existing Joint Ventures
10.6 Lending Offices and Notice Addresses
(Credit Agreement)
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CREDIT AGREEMENT
This CREDIT AGREEMENT dated as of October 7, 1999 is entered into by
and among FLOWSERVE CORPORATION, a New York corporation ("Borrower"), each
lender whose name is set forth on the signature pages of this Agreement and each
lender which may hereafter become a party to this Agreement (collectively, the
"Banks" and individually, a "Bank"), Bank of America, N.A., as Administrative
Agent and as Issuing Bank, Bank One, Texas, NA, as Syndication Agent and ABN
Amro Bank N.V., as Documentation Agent.
In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:
SECTION 1
DEFINITIONS AND ACCOUNTING TERMS
1.1 DEFINED TERMS. As used in this Agreement, the following terms have
the meanings set forth below:
"Affiliate" means, as to any Person, any other Person which directly or
indirectly controls, or is under common control with, or is controlled by, such
Person. As used in this definition, "control" (and the correlative terms,
"controlled by" and "under common control with") shall mean possession, directly
or indirectly, of power to direct or cause the direction of management or
policies (whether through ownership of securities or partnership or other
ownership interests, by contract or otherwise); provided that, in any event, any
Person that owns, directly or indirectly, 10% or more of the securities having
ordinary voting power for the election of directors or other governing body of a
corporation that has more than 100 record holders of such securities, or 10% or
more of the partnership or other ownership interests of any other Person that
has more than 100 record holders of such interests, will be deemed to control
such corporation, partnership or other Person.
"Administrative Agent" means Bank of America, when acting in its
capacity as the Administrative Agent under any of the Loan Documents, or any
successor Administrative Agent.
"Agent's Office" means the Administrative Agent's address and, as
appropriate, account as set forth on Schedule 10.6, or such other address or
account as the Administrative Agent hereafter may designate by written notice to
Borrower and the Banks.
"Agent-Related Persons" means the Administrative Agent (including any
successor agent), together with their respective Affiliates, and the officers,
directors, employees, agents and attorneys-in-fact of such Persons and
Affiliates.
"Agreement" means this Agreement, either as originally executed or as
it may from time to time be supplemented, modified, amended, restated or
extended.
(Credit Agreement)
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"Applicable Amount" means:
(a) for any Pricing Period with respect to Tranche A Commitments, the
per annum amounts set forth below under Applicable Amount opposite the
applicable Leverage Ratio; provided however, that until the date that is six
months from the Closing Date, the Applicable Amount shall be not less than the
per annum amounts indicated below for a Leverage Ratio of <2.0 but > or = 1.0:
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(a) Pricing for Tranche A Loans
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Applicable Amount
(in basis points per annum)
Leverage Ratio
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Applicable Amount For
Financial Letters of Credit
________ Applicable Amount for
Facility Fee Applicable Amount for Base Rate Loans
Offshore Rate Loans ________
Base Rate +
Offshore Rate +
------------------------------- ------------------------ ------------------------------ -------------------------
> or = 3.5 50.0 150.0 100.0
------------------------------- ------------------------ ------------------------------ -------------------------
<3.5 but > or = 3.0 50.0 125.0 75.0
------------------------------- ------------------------ ------------------------------ -------------------------
<3.0 but > or = 2.5 45.0 105.0 50.0
------------------------------- ------------------------ ------------------------------ -------------------------
<2.5 but > or = 2.0 35.0 90.0 25.0
------------------------------- ------------------------ ------------------------------ -------------------------
<2.0 but > or = 1.0 25.0 75.0 0.0
------------------------------- ------------------------ ------------------------------ -------------------------
<1.0 17.5 57.5 0.0
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(b) for any Pricing Period with respect to Tranche B Commitments, the
per annum amounts set forth below under Applicable Amount opposite the
applicable Leverage Ratio; provided however, that until the date that is six
months from the Closing Date, the Applicable Amount shall be not less than the
per annum amounts indicated below for a Leverage Ratio of <2.0 but > or = 1.0:
(Credit Agreement)
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(b) Pricing for Tranche B Loans
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Applicable Amount
(in basis points per annum)
Leverage Ratio
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Applicable Amount For Applicable Amount For
Offshore Rate Loans Base Rate Loans
Facility Fee __________ __________
Offshore Rate + Base Rate +
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> or = 3.5 47.5 152.5 100.0
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< 3.5 but > or = 3.0 47.5 127.5 75.0
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< 3.0 but > or = 2.5 42.5 107.5 50.0
--------------------------- --------------------------- ------------------------------- -------------------------
< 2.5 but > or = 2.0 32.5 92.5 25.0
--------------------------- --------------------------- ------------------------------- -------------------------
< 2.0 but > or = 1.0 22.5 77.5 0
--------------------------- --------------------------- ------------------------------- -------------------------
< 1.0 15.0 60.0 0
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As used in this definition:
"Applicable Amount Change Date" means the day following the last date
of the period covered by the financial statements delivered by Borrower pursuant
to Section 6.1 reflecting such change in the Leverage Ratio.
"Applicable Taxes" means any and all present or future taxes (including
documentary taxes), levies, assessments, imposts, duties, deductions, fees,
withholdings or similar charges, and all liabilities with respect thereto
imposed by a Governmental Authority relating to any Loan Document, including any
liabilities imposed on amounts paid by Borrower to indemnify or reimburse any
Person for such amounts, excluding Bank Taxes.
"Approved Offshore Currency" means Euros, and any other currency that
in the opinion of all Banks is freely traded in the offshore interbank foreign
exchange markets and is freely transferable and freely convertible into Dollars
and in which dealings in deposits are carried out on the London interbank
market.
"Arrangers" means Banc of America Securities LLC and Banc One Capital
Markets, Inc.
"Attorney Costs" means and includes all fees and disbursements of any
law firm or other external counsel and the allocated cost of internal legal
services and all disbursements of internal counsel.
"Bank" means each lender from time to time party hereto and the Issuing
Bank.
"Bank of America" means Bank of America, N.A., a national banking
association.
(Credit Agreement)
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"Bank Taxes" means, in the case of each Bank, the Administrative Agent
and each Eligible Assignee, and any Affiliate, the Issuing Bank or Lending
Office thereof: (a) taxes imposed on or measured in whole or in part by its
overall net income, gross income or gross receipts or capital and franchise
taxes imposed on it, by (i) any jurisdiction (or political subdivision thereof)
in which it is organized or maintains its principal office or Lending Office or
(ii) any jurisdiction (or political subdivision thereof) in which it is "doing
business" (unless it would not be doing business in such jurisdiction (or
political subdivision thereof) absent the transactions contemplated hereby), (b)
any withholding taxes or other taxes based on gross income imposed by the United
States of America (other than withholding taxes and taxes based on gross income
resulting from or attributable to any change in any law, rule or regulation or
any change in the interpretation or administration of any law, rule or
regulation by any Governmental Authority) or (c) any withholding taxes or other
taxes based on gross income imposed by the United States of America for any
period with respect to which it has failed to provide Borrower with the
appropriate form or forms required by Section 10.22, to the extent such forms
are then required by applicable Laws.
"Base Rate" means, for any day, the higher of: (a) 0.50% per annum
above the latest Federal Funds Rate; and (b) the rate of interest in effect for
such day as publicly announced from time to time by Bank of America in
Charlotte, North Carolina, as its "reference rate." The "reference rate" is a
rate set by Bank of America based upon various factors including Bank of
America's costs and desired return, general economic conditions and other
factors, and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate.
"Base Rate Loan" means a Loan which bears interest based on the Base
Rate.
"Borrower" means Flowserve Corporation, a New York corporation.
"Borrowing" and "Borrow" each mean a borrowing hereunder consisting of
Loans of the same type made on the same day and, other than in the case of Base
Rate Loans, having the same Interest Period.
"Borrowing Date" means the date that a Loan is made by the Banks, which
shall be a Business Day.
"Business Day" means any day other than a Saturday, Sunday or other day
on which commercial banks in New York City or San Francisco are authorized or
required by law to close and, if the applicable Business Day relates to any
Offshore Rate Loan, means any such day on which dealings are carried on in the
London interbank market in Dollars or, with respect to Offshore Currency Loans,
any such day on which dealings carried on in the London interbank market in the
Approved Offshore Currency of such Offshore Currency Loan, and if the applicable
Business Day relates to the Euro, means (a) any such day which is, for payments
of purchases of the Euro, a TARGET Business Day and (b) for all other purposes,
including without limitation the giving and receiving of notices hereunder, a
TARGET Business Day on which banks are generally open for business in London,
Frankfurt and in any other principal financial center as the Administrative
Agent may from time to time determine for this purpose.
(Credit Agreement)
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"Capital Lease Obligation" means, with respect to any lease of property
which, in accordance with GAAP, should be capitalized on the lessee's balance
sheet or for which the amount of the assets and liabilities thereunder, if so
capitalized, should be disclosed in a note to such balance sheet, the amount of
the liability which should be so capitalized or disclosed.
"Cash Equivalents" means:
(a) cash;
(b) Securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed or insured by the United States
Government or any agency thereof or Securities of comparable credit quality
issued by foreign governments;
(c) bank instruments, each with maturities of one year or less from the
date of acquisition of any Bank or any other commercial bank having capital and
surplus in excess of $300,000,000 and having a rating on commercial paper issued
by such commercial bank of at least A-2 by S&P or P-2 by Moody's (or if at such
time neither is issuing ratings, then a comparable rating of such other
nationally recognized rating agency as shall be approved by Requisite Banks) or
a comparable credit in a foreign country;
(d) commercial paper of an issuer rated at least A-2 by S&P or P-2
by Moody's (or if at such time neither is issuing ratings, then a comparable
rating of such other nationally recognized rating agency as shall be approved by
Requisite Banks);
(e) repurchase agreements fully collateralized by any obligation
referred to above obligating any Bank or any other commercial bank having
capital and surplus in excess of $300,000,000 and having a rating on commercial
paper issued by such commercial bank of at least A-2 by S&P or P-2 by Moody's
(or if at such time neither is issuing ratings, then a comparable rating of such
other nationally recognized rating agency as shall be approved by Requisite
Banks) or a comparable credit in a foreign country to repurchase such obligation
not later than 90 days after the purchase of such obligation;
(f) Securities of Borrower and its Subsidiaries held in their
respective treasuries;
(g) preferred stock commonly known as Dutch Auction Preferred Stock,
Capital Market Preferred Stock, Remarketable Preferred Stock, Variable Rate
Preferred Stock or other similar terms; provided that in each case such
preferred stock has the highest rating given by S&P or Moody's (or if at such
time neither is issuing ratings, then the highest rating of such other
nationally recognized rating agency as shall be approved by Requisite Banks);
and
(h) money market programs of investment companies regulated under the
Investment Company Act of 1940, as amended, which, at the time of acquisition by
Borrower or a Subsidiary, if rated, are (or if such money market programs are
not rated the underlying investments of which are) rated A-1 by S&P or P-1 by
Moody's (or if at such time neither is issuing ratings, then a comparable rating
of such other nationally recognized rating agency as shall be approved by
Requisite Banks); provided that such money market programs invest only in
investments of the type described in this definition.
(Credit Agreement)
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"Change of Control" means the acquisition by any Person, or two or more
Persons acting in concert of beneficial ownership (within the meaning of Rule
13d-3 of the Exchange Act) of 25% or more of the outstanding shares of voting
stock of Borrower.
"Closing Date" means the time and Business Day on which the conditions
set forth in Section 4.1 are satisfied or waived. The Administrative Agent shall
notify Borrower and the Banks of the date that is the Closing Date.
"Code" means the Internal Revenue Code of 1986, as amended or replaced
and as in effect from time to time.
"Commercial Letter of Credit" means any letter of credit issued for the
account of Borrower for the purpose of providing the principal payment mechanism
in connection with the purchase of goods by Borrower or any of its Subsidiaries
in the ordinary course of business.
"Commitment" means, for each Bank, the Tranche A Commitment and Tranche
B Commitment (collectively, the "combined Commitments").
"Compliance Certificate" means a certificate in the form of Exhibit B,
properly completed and signed by a Responsible Officer.
"Consolidated Adjusted EBITDA" means, for any period, (a) EBITDA for
such period for the Borrower and its Subsidiaries on a consolidated basis
determined in accordance with GAAP, plus (b) in the case of each Person acquired
by Borrower and its Subsidiaries, the EBITDA of such Person for the applicable
period prior to its acquisition by Borrower or a Subsidiary, but only if the
annualized EBITDA (excluding any one time adjustments) of such Person is at
least $5,000,000; provided that such EBITDA of such Person prior to its
acquisition by Borrower or a Subsidiary shall be included only if the financial
statements of such Person for such applicable period prior to its acquisition by
Borrower or a Subsidiary have been audited by a "Big Five" accounting firm or
another independent accounting firm reasonably satisfactory to the Requisite
Banks.
"Consolidated Funded Debt," means, as of any date, the sum of (a) items
(a), (b), (c) and (d) of the definition of Debt plus (b) all drawn but not
reimbursed letters of credit (including Letters of Credit issued hereunder) and,
without duplication, plus (c) the greater of aggregate amount of liability
assumed or net cash proceeds received with respect to outstanding accounts
receivables subject to a Receivables Program in a sale or other financing of
accounts permitted by Section 7.13, all on a consolidated basis for Borrower and
its Subsidiaries.
"Consolidated Interest Charges" means, for any period, for Borrower and
its Subsidiaries on a consolidated basis, the sum of (a) all interest, premium
payments, fees, charges and related expenses payable by Borrower and its
Subsidiaries in connection with borrowed money (including capitalized interest)
or in connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP, and (b) the portion of rent
payable by Borrower and its Subsidiaries with respect to such period under
capital leases that is treated as interest in accordance with GAAP.
(Credit Agreement)
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"Consolidated Net Income" means, for any period, the net income of
Borrower and its Subsidiaries on a consolidated basis for such period determined
in accordance with GAAP.
"Consolidated Net Worth" of any Person means the consolidated
shareholders' equity of such Person and its consolidated Subsidiaries determined
in accordance with GAAP (but without taking into account any adjustments for the
effects of foreign currency translation pursuant to Statement No. 52 of the
Financial Accounting Standards Board, or any similar statement issued in
substitution therefor).
"Consolidated Total Assets" means, as of any date of determination, all
assets that should be reflected as assets on a consolidated balance sheet of
Borrower and its Subsidiaries on such date prepared in accordance with GAAP.
"Contingent Obligation", as applied to any Person, means (a) any direct
or indirect liability, contingent or otherwise, of the Person with respect to
any Debt, lease, dividend, letter of credit or other obligation of another,
including, without limitation, any such obligation directly or indirectly
guarantied in writing, endorsed (other than for collection or deposit in the
ordinary course of business), co-made, or discounted or sold with recourse by
that Person, or in respect of which that Person is otherwise directly or
indirectly liable, including without limitation, any such obligation for which
that Person is in effect liable through any agreement (contingent or otherwise)
to purchase, repurchase or otherwise acquire such obligation or any security
therefor, or to provide funds for the payment or discharge of such obligation
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise), or to maintain the solvency or any balance sheet item, level of
income or other financial condition of the obligor of such obligation, or to
make payment for any products, materials or supplies or for any transportation,
services or lease regardless of the non-delivery or non-furnishing thereof, in
any case if the purpose or intent of such agreement is to provide assurance that
such obligation will be paid or discharged, or that any agreements relating
thereto will be complied with, or that the holders of such obligation will be
protected (in whole or in part) against loss in respect thereof; the amount of
any Contingent Obligation shall be equal to the amount of the obligation so
guarantied or otherwise supported and (b) net obligations of such Person under
any Swap Agreement in an amount equal to (i) if such Swap Agreement has been
closed out, the termination value thereof, or (ii) if such Swap Agreement has
not been closed out, the xxxx-to-market value thereof determined on the basis of
readily available quotations provided by any recognized dealer in such Swap
Agreements.
"Continuation" and "Continue" each mean, with respect to any Loan other
than a Base Rate Loan, the continuation of such Loan as the same type of Loan in
the same principal amount and in the same currency, but with a new Interest
Period and an interest rate determined as of the first day of such new Interest
Period. Continuations must occur on the last day of the Interest Period for such
Loan.
"Contractual Obligation" means, as to any Person, any provision of any
outstanding security issued by that Person or of any material agreement,
instrument or undertaking to which that Person is a party or by which it or any
of its property is bound.
(Credit Agreement)
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"Conversion" and "Convert" each mean, with respect to any Loan, the
conversion of one type of Loan in one currency into another type of Loan in the
same currency. With respect to Loans other than Base Rate Loans, Conversions
must occur on the last day of the Interest Period for such Loan.
"Debt" means, without duplication, (a) indebtedness for borrowed money,
(b) obligations evidenced by bonds (other than performance bonds), debentures,
notes or other similar instruments, (c) obligations to pay the deferred purchase
price of property or services (other than trade payables incurred in the
ordinary course of business and not more than 60 days past due or being
contested in good faith by appropriate proceedings and other than payments made
in respect of employment contracts), (d) Capital Lease Obligations, (e)
obligations under direct or indirect written guaranties in respect of, and
obligations (contingent or otherwise) to purchase or otherwise acquire, or
otherwise to assure a creditor against loss in respect of, indebtedness or
obligations of others of the kinds referred to in clauses (a) through (d) above,
and (f) liabilities in respect of unfunded vested benefits under plans covered
by Title IV of ERISA.
"Debtor Relief Laws" means the Bankruptcy Code of the United States of
America, as amended from time to time, and all other applicable liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief Laws from time to time in effect affecting the rights of creditors
generally.
"Default" means any event that, with the giving of any applicable
notice or passage of time specified in Section 8.1, or both, would be an Event
of Default.
"Default Rate" means an interest rate equal to the Base Rate plus the
Applicable Amount, if any, applicable to the Base Rate plus 2%, to the fullest
extent permitted by applicable Laws.
"Designated Deposit Account" means a deposit account to be maintained
by Borrower with Bank of America, as from time to time designated by Borrower by
written notification to the Administrative Agent.
"Disposition" means the sale, transfer, or other disposition of any
asset of Borrower or any of its Subsidiaries, including without limitation any
sale, assignment, pledge, hypothecation, transfer or other disposal with or
without recourse of any notes or accounts receivable or any rights and claims
associated therewith.
"Dollars" or "$" means United States dollars.
"Dollar Equivalent" means the equivalent in Dollars of the applicable
currency calculated at the Spot Rate as of (a) the date of any Extension of
Credit, (b) the last Business Day of each month, (c) the date any payment is
made with respect to any Obligation denominated in an Approved Offshore
Currency, and (d) any date selected from time to time by the Administrative
Agent in its sole discretion or at the direction of the Requisite Banks.
"EBITDA" means, (without duplication) with respect to any Person and
for any period, (a) the sum of (i) net income, plus (ii) interest expense
(including, with respect to Borrower and its Subsidiaries, any interest expense
or discount of Borrower or any of its Subsidiaries,
(Credit Agreement)
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15
associated with any sale or other financing of accounts permitted under Section
7.13), plus (iii) depreciation expense, plus (iv) amortization expense of
goodwill, other intangibles and financing costs, plus (v) extraordinary losses,
plus (vi) Federal, state, local and foreign income tax expense, minus (b)
extraordinary gains on asset sales, minus (c) noncash extraordinary income.
"Eligible Assignee" means (a) a financial institution organized under
the laws of the United States, or any state thereof, and having a combined
capital and surplus of at least $100,000,000; (b) a commercial bank organized
under the laws of any other country which is a member of the Organization for
Economic Cooperation and Development, or a political subdivision of any such
country, and having a combined capital and surplus of at least $100,000,000,
provided that such bank is acting through a branch or agency located in the
United States; (c) a Person that is primarily engaged in the business of
commercial banking and that is (i) a Subsidiary of a Bank, (ii) a Subsidiary of
a Person of which a Bank is a Subsidiary, or (iii) a Person of which a Bank is a
Subsidiary and (d) another Bank.
"Environmental Law" means any and all statutes, laws, regulations,
ordinances, rules, judgments, orders, decrees, permits, concessions, grants,
franchises, licenses, agreements or other governmental restrictions of any
federal, state or local governmental authority within the United States or any
State or Territory thereof and which relate to the environment or the release of
any materials into the environment.
"Equity Proceeds" means, as of any date of determination, the aggregate
amount of the net proceeds received by Borrower from the sale or sales of, or
capital contributions with respect to, its common stock, preferred stock or
other capital stock or rights, options or warrants therefor, after deduction of
costs, discounts and commissions incurred in connection with such sale or sales,
to such date of determination.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person who for purposes of Title IV of
ERISA is a member of Borrower's controlled group, or under common control with
Borrower, within the meaning of Section 414 of the Code and the regulations
promulgated and rulings issued thereunder.
"ERISA Event" means (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, unless the 30-day notice requirement with
respect thereto has been waived by the PBGC; (ii) the provision by the
administrator of any Pension Plan of a notice of intent to terminate such
Pension Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice
with respect to a plan amendment referred to in Section 4041(e) of ERISA); (iii)
the cessation of operations at a facility in the circumstances described in
Section 4068(f) of ERISA; (iv) the withdrawal by Borrower or an ERISA Affiliate
from a Multiemployer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (v) the failure by Borrower
or any ERISA Affiliate to make a payment to a Pension Plan required under
Section 302(f)(1) of ERISA, which Section imposes a lien for failure to make
required payments; (vi) the adoption of an amendment to a Pension Plan requiring
the provision of security to such Pension Plan, pursuant to Section 307 of
ERISA; or (vii) the institution by the PBGC of
(Credit Agreement)
9
16
proceedings to terminate a Pension Plan, pursuant to Section 4042 of ERISA, or
the occurrence of any event or condition which, in the reasonable judgment of
Borrower, might constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, a Pension Plan.
"Euro" means the single currency of participating member states
introduced in accordance with the provisions of Article 109(1)(4) of the Treaty;
all payments to be made under this Agreement in euros shall be made in
immediately available, freely transferable funds.
"Event of Default" has the meaning provided in Section 8.1.
"Excess Net Proceeds" has the meaning provided in Section 7.6(g).
"Existing Credit Agreement" means the Credit Agreement dated as of
November 26, 1997 among Borrower, the lenders named therein and Bank of America,
National Trust and Savings Association, as agent, as amended to the date hereof.
"Extension of Credit" means (a) the Borrowing of any Loans, (b) the
Conversion or Continuation of any Loans or (c) the issuance, renewal, increase,
continuation, amendment or other credit action with respect to any Letter of
Credit, including the Banks acquiring a participation in such Letters of Credit
(collectively, the "Extensions of Credit").
"Federal Funds Rate" means, for any day, the rate set forth in the
weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Bank of New York (including any
such successor, "H.15(519)") on the preceding Business Day opposite the caption
"Federal Funds (Effective)"; or, if for any relevant day such rate is not so
published on any such preceding Business Day, the rate for such day will be the
arithmetic mean as determined by the Administrative Agent of the rates for the
last transaction in overnight Federal funds arranged prior to 9:00 a.m. (New
York City time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Administrative Agent.
"Financial Letter of Credit" means any Standby Letter of Credit that is
not a Performance Letter of Credit.
"Fiscal Quarter" means the fiscal quarter of Borrower consisting of a
three-month fiscal period ending on each March 31, June 30, September 30 and
December 31.
"Fiscal Year" means the fiscal year of Borrower consisting of a
twelve-month period ending on each December 31.
"FRB" means the Board of Governors of the Federal Reserve System or any
governmental authority succeeding to its functions.
"Generally Accepted Accounting Principles" or "GAAP" means, as of any
date of determination, accounting principles (a) set forth as generally accepted
in then currently effective Opinions of the Accounting Principles Board of the
American Institute of Certified Public Accountants, (b) set forth as generally
accepted in then currently effective Statements of the
(Credit Agreement)
10
17
Financial Accounting Standards Board or (c) that are then approved by such other
entity as may be approved by a significant segment of the accounting profession
in the United States of America. The term "consistently applied," as used in
connection therewith, means that the accounting principles applied are
consistent in all material respects with those applied at prior dates or for
prior periods.
"Governmental Authority" means (a) any international, foreign, federal,
state, county or municipal government, or political subdivision thereof, (b) any
governmental or quasi-governmental agency, central bank or comparable authority,
authority, board, bureau, commission, department, instrumentality or public
body, or (c) any court or administrative tribunal of competent jurisdiction.
"Increase Date" has the meaning specified in Section 2.6.
"Increase Remainder" has the meaning specified in Section 2.6.
"Increased Commitment Acceptance" means an acceptance of a Proposed
Increased Commitment entered into by a Bank and accepted by the Administrative
Agent, in substantially the form of Exhibit F.
"Interest Payment Date" means, (a) with respect to any Base Rate Loan,
the last Business day of each calendar quarter and the Tranche A Maturity Date
or Tranche B Maturity Date, as applicable, and (b) with respect to any other
type of Loan, (i) any date that such Loan is prepaid in whole or in part, (ii)
the last day of each Interest Period applicable to, or the maturity of, such
Loan; provided, however, that if any Interest Period or the maturity of any such
Loan exceeds three months, the date that falls three months after the beginning
of such Interest Period shall also be an Interest Payment Date, and (iii) the
Tranche A Maturity Date or Tranche B Maturity Date, as applicable.
"Interest Period" means, as to any Loans other than Base Rate Loans,
the period commencing on the date specified by Borrower in its Request for
Extension of Credit and ending one, two, three or six (or if available to all
Banks, 4 or 5 months) thereafter (as selected by Borrower in the Request for
Extension of Credit relating thereto; provided that:
(a) The first day of any Interest Period shall be a Business Day;
(b) Any Interest Period that would otherwise end on a day that is not a
Business Day shall be extended to the next succeeding Business Day unless, in
the case of an Offshore Rate Loan, such Business Day falls in another calendar
month, in which case such Interest Period shall end on the next preceding
Business Day; and
(c) No Interest Period shall extend beyond the Tranche A Maturity Date
or Tranche B Maturity Date, as applicable.
"Investment", as applied to any Person means any direct or indirect
purchase or other acquisition by that Person of, or a beneficial interest in,
stock or other Securities of any other Person, or any direct or indirect loan,
advance (other than advances to employees or consultants for moving and travel
expenses, drawing accounts and similar expenditures in the ordinary
(Credit Agreement)
11
18
course of business) or capital contribution by that Person to any other Person,
including all Debt and accounts receivable from that other Person which are not
current assets or did not arise from sales to that other Person in the ordinary
course of business. The amount of any Investment shall be the original cost of
such Investment plus the cost of all additions thereto, without any adjustments
for increases or decreases in value, or write-ups, write-downs or write-offs
with respect to such Investment.
"IRS" means the Internal Revenue Service.
"Issuing Bank" means Bank of America, N.A.
"Joint Venture" means a joint venture, partnership or other similar
arrangement, whether in corporate, partnership or other legal form; provided
that in no event shall any corporate Subsidiary of any Person be considered to
be a Joint Venture to which such Person is a party.
"Laws" means, collectively, all international, foreign, federal, state
and local statutes, treaties, rules, guidelines, regulations, ordinances, codes
and administrative or judicial precedents, including without limitation the
interpretation thereof by any Governmental Authority charged with the
enforcement thereof.
"Lending Office" means, as to any Bank, the office or offices of such
Bank specified as its "Lending Office" or "Domestic Lending Office" or "Offshore
Lending Office", as the case may be, on Schedule 10.6, or such other office or
offices as such Bank may from time to time notify Borrower and the
Administrative Agent.
"Letter of Credit" means any of the letters of credit issued by the
Issuing Bank hereunder, either as originally issued or as the same may be
supplemented, amended, renewed or extended.
"Letter of Credit Application" means an application for issuances of,
or amendments to, letters of credit as shall at any time be in use at the
Issuing Bank.
"Letter of Credit Usage" means, as at any date of determination, the
undrawn face amount of outstanding Letters of Credit plus the aggregate amount
of all drawings under the Letters of Credit honored by the Issuing Bank and not
theretofore reimbursed or converted into Loans.
"Leverage Ratio" means as of any date of determination, the ratio of
(a) Consolidated Funded Debt plus the outstanding amount of Financial Letters of
Credit in excess of $25,000,000 in the aggregate as of such date, to (b)
Consolidated Adjusted EBITDA for the four Fiscal Quarters ending on such date,
plus, if such four Fiscal Quarter period covers the period in which a one time
charge relating to restructuring and integration costs is taken, up to
$50,000,000 of such one time restructuring and integration cost charge actually
taken by Borrower in 1999 or the first quarter of 2000.
"Lien" means any lien, mortgage, pledge, security interest, charge,
encumbrance, easement, exception or assessment of any kind (including any
conditional sale or other title retention agreement, any lease in the nature
thereof, and, with respect to an asset or assets that are material, any
agreement to give any security interest in the future).
(Credit Agreement)
12
19
"Loan" means any advance made or to be made by any Bank to Borrower as
provided in Section 2, and includes each Tranche A Loan, Tranche B Loan and
Swing Line Loan.
"Loan Documents" means, collectively, this Agreement, the Notes, the
Letters of Credit, the Material Subsidiary Guaranty, any Request for Extension
of Credit, any Letter of Credit Application, any Compliance Certificate and any
other agreements of any type or nature hereafter executed and delivered by
Borrower or any of its Subsidiaries or Affiliates to the Administrative Agent,
the Issuing Bank or to any Bank in any way relating to or in furtherance of this
Agreement, in each case either as originally executed or as the same may from
time to time be supplemented, modified, amended, restated, extended or
supplanted.
"Long-Term Debt" means, as of any date of determination, senior,
unsecured debt securities of Borrower with a scheduled maturity in excess of
twelve months from such determination date.
"Material Adverse Effect" means a material adverse effect, individually
or in the aggregate, upon (i) the business, operations, properties, prospects,
assets or condition (financial or otherwise) of Borrower and its Subsidiaries,
taken as a whole, or (ii) the financial ability of Borrower and its
Subsidiaries, taken as a whole, or otherwise Borrower or any Subsidiary (if a
party thereto) to perform or of the Banks to enforce the Obligations under the
Loan Documents.
"Material Subsidiary" means any domestic Subsidiary of Borrower having
(a) Consolidated Total Assets which account 10% or more of the Consolidated
Total Assets of Borrower and its Subsidiaries, or (b) revenue which is 10% or
more of the total revenue of Borrower and its Subsidiaries on a consolidated
basis, in each case determined based upon the most recent financial statements
delivered pursuant to Section 6.1.
"Material Subsidiary Guaranty" means the Material Subsidiary Guaranty
substantially in the form of Exhibit E, as amended, supplemented, restated or
otherwise modified from time to time.
"Maximum Permitted Combined Tranche A Commitments" means $360,000,000.
"Maximum Permitted Combined Tranche B Commitments" means $240,000,000.
"Minimum Amount" means, with respect to each of the following actions,
the following amounts set forth opposite such action (a reference to "Minimum
Amount" shall also be deemed a reference to the multiples in excess thereof set
forth below):
(Credit Agreement)
13
20
Minimum
Multiples
in excess of
Type of Action Minimum Amount Minimum Amount
Borrowing or prepayment of Swing $ 100,000 $ 50,000
Line Loans
Borrowing of, prepayment of or $ 1,000,000 $ 500,000
Conversion into, Base Rate Loans
(other than Swing Line Loans)
Borrowing of, prepayment of, $ 5,000,000 $ 1,000,000
Continuation of, or Conversion
into, Offshore Rate Loans
Reduction in Commitments $25,000,000 $10,000,000
Increase in Commitments $10,000,000 $10,000,000
Assignments $ 5,000,000
"Minority Interest Subsidiary Debt" means the portion of the Debt of a
Subsidiary of Borrower which is allocable to third-party owners of the capital
stock of such Subsidiary based on the ownership interest of such third party
owners in relation to the ownership interests of Borrower and its Subsidiaries.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a)(3) of ERISA to which Borrower or any ERISA Affiliate of Borrower is
making, or is obligated to make, contributions or has within any of the
preceding five plan years made or accrued an obligation to make contributions.
"Net Proceeds" means, with respect to any Disposition, the gross sales
proceeds received by Borrower and its Subsidiaries from such Disposition
(including cash, property and the assumption by the purchaser of any liability
of Borrower or its Subsidiaries) net of brokerage commissions, legal expenses
and other transactional costs payable by Borrower and its Subsidiaries with
respect to such Disposition and net of an amount determined in good faith by
Borrower to be the estimated amount of income taxes payable by Borrower
attributable to such Disposition.
"New Commitment Acceptance" means an acceptance of a Proposed New
Commitment entered into by an Accepted Bank and accepted by the Administrative
Agent, in substantially the form of Exhibit G hereto.
(Credit Agreement)
14
21
"Non-Hostile Acquisition" means an acquisition (whether by purchase of
capital stock or assets, merger or otherwise) which has been approved by
resolutions of the Board of Directors of the Person being acquired or by similar
action if the Person is not a corporation and as to which such approval has not
been withdrawn.
"Non-Recourse Debt" means, as applied to any Receivables Program, Debt
under the terms of which no personal recourse may be had against Borrower or any
of its Subsidiaries for the payment of the principal of or interest or premium
on such Debt solely as a result of a default by one or more account debtors in
the payment of any accounts receivable included in such Receivables Program.
"Notes" means, collectively, the Tranche A Loan Notes, the Tranche B
Loan Notes, and the Swing Line Notes.
"Notice of Assignment and Acceptance" means a Notice of Assignment and
Acceptance substantially in the form of Exhibit D.
"Obligations" means all loans, advances, debts, reimbursement
obligations, liabilities, obligations, covenants and duties owing by Borrower or
any of its Subsidiaries to any Bank, the Administrative Agent, the Issuing
Banks, any affiliate of any Bank or the Administrative Agent, or any Person
entitled to indemnification pursuant to Section 10.11, of any kind or nature,
present or future, whether or not evidenced by any note, guaranty or other
instrument, arising under this Agreement or under any written guaranties
executed by any of Borrower's Subsidiaries in favor of the Administrative Agent
on behalf of the Banks, whether or not for the payment of money, whether arising
by reason of an extension of credit, loan, written guaranty, indemnification,
letter of credit transactions or bankers' acceptance transactions or in any
other manner, whether direct or indirect (including those acquired by
assignment), absolute or contingent, due or to become due, now existing or
hereafter arising and however acquired. The term includes, without limitation,
all interest, charges, expenses, fees, attorneys' fees and disbursements and any
other sum chargeable to Borrower or any of its Subsidiaries under this Agreement
or any guaranties executed by any of Borrower's Subsidiaries in favor of the
Administrative Agent on behalf of the Banks.
"Offshore Base Rate" has the meaning set forth in the definition of
Offshore Rate.
"Offshore Currency Loan" means a Loan denominated in an Approved
Offshore Currency that bears interest based on the Offshore Rate.
"Offshore Currency Overnight Rate" means, for any day, the rate of
interest per annum at which overnight deposits in an Approved Offshore Currency,
in an amount approximately equal to the amount with respect to which such rate
is being determined, would be offered for such day by Bank of America's
principal office in London to major banks in the London or other applicable
offshore interbank market.
"Offshore Rate" means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of interest
per annum (rounded upward to the next 1/16th of 1%) determined by the
Administrative Agent as follows:
(Credit Agreement)
15
22
Offshore Rate = Offshore Base Rate
----------------------------
1.00 - EURODOLLAR RESERVE PERCENTAGE
Where,
"Eurodollar Reserve Percentage" means for any day for any
Interest Period the maximum reserve percentage (expressed as a decimal,
rounded upward to the next 1/100th of 1%) in effect on such day
(whether or not applicable to any Bank) under regulations issued from
time to time by the FRB for determining the maximum reserve requirement
(including any emergency, supplemental or other marginal reserve
requirement) with respect to Eurocurrency funding (currently referred
to as "Eurocurrency liabilities"); and
"Offshore Base Rate" means the rate of interest per annum
determined by the Administrative Agent to be the arithmetic mean
(rounded upward to the next 1/16th of 1%) of the rates of interest per
annum notified to the Administrative Agent by Bank of America as the
rate of interest at which deposits in Dollars or the applicable
Approved Offshore Currency, as the case may be, in the case of a Loan,
in an amount approximately equal to Bank of America's Offshore Rate
Loan comprising part of such Borrowing, and having a maturity
comparable to the Interest Period of such Loans would be offered to
major banks in the London or interbank market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the
commencement of such Interest Period.
"Offshore Rate Loan" means a Loan that bears interest based on the
Offshore Rate.
"Opinion of Counsel" means the favorable written legal opinion of Xxxx
X. Xxxxx, Esq., Sr. Associate General Counsel of Borrower and its Subsidiaries,
substantially in the form of Exhibit I, together with copies of all factual
certificates and legal opinions upon which such counsel has relied.
"Outstanding Obligations" means Outstanding Tranche A Obligations and
Outstanding Tranche B Obligations.
"Outstanding Tranche A Obligations" means, as of any date, and giving
effect to making any Extensions of Credit requested on such date and all
payments, repayment and prepayments made on such date, the sum of (a) the
aggregate outstanding principal of all Tranche A Loans, and (b) all Letter of
Credit Usage.
"Outstanding Tranche B Obligations" means, as of any date, and giving
effect to making any Extensions of Credit requested on such date and all
payments, repayment and prepayments made on such date, the aggregate outstanding
principal of all Tranche B Loans.
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
thereto established under ERISA.
(Credit Agreement)
16
23
"Pension Plan" means any "employee pension benefit plan" (as such term
is defined in Section 3(2) of ERISA), other than a Multiemployer Plan, which is
subject to Title IV of ERISA and is sponsored or maintained by Borrower or any
ERISA Affiliates or to which Borrower or any ERISA Affiliate contributes or has
an obligation to contribute, or in the case of a multiple employer plan (as
described in Section 4064(a) of ERISA) has made contributions or accrued an
obligation to make contribution at any time during the immediately preceding
five years.
"Performance Letter of Credit" means a Standby Letter of Credit
covering potential default by the Person for whose account the Standby Letter of
Credit is issued for the purpose of performance-related, non-financial
contractual obligations. By way of example, and not by limitation,
performance-related contractual obligations include construction, bid or
performance bonds, performance warranties payable upon breach, releases of funds
retained to cover performance and refunds of advance payments on contractual
obligations where default of a performance related contract has occurred.
"Person" means any individual or entity, including a trustee,
corporation, limited liability company, general partnership, limited
partnership, joint stock company, trust, estate, unincorporated organization,
business association, firm, joint venture, Governmental Authority, or other
entity.
"Plan" means an employee benefit plan, as defined in Section 3(3) of
ERISA, which Borrower or any ERISA Affiliate sponsors or maintains, or to which
Borrower or any ERISA Affiliate makes, is making or is obligated to make,
contributions; and includes any Pension Plan or Multiemployer Plan.
"Pricing Period" means (a) the period commencing on the Closing Date
and ending on the first Applicable Amount Change Date to occur thereafter and
(b) each subsequent period commencing on each Applicable Amount Change Date and
ending the day prior to the next Applicable Amount Change Date.
"Proposed Combined Commitments Increase" has the meaning specified in
Section 2.6.
"Proposed Increased Commitment" has the meaning specified in Section
2.6.
"Proposed New Commitment" has the meaning specified in Section 2.6.
"Pro Rata Share" means, with respect to each Bank, the percentage of
the combined Commitments set forth opposite the name of that Bank on Schedule
2.1.
"Quarterly Payment Date" means each June 30, September 30, December 31
and March 31.
"Receivables Program" has the meaning specified in Section 7.13.
"Request for Extension of Credit" means a written request substantially
in the form of Exhibit A duly completed and signed by a Responsible Officer, or
a telephonic request followed by such a written request, in each case delivered
to the Administrative Agent by Requisite Notice.
(Credit Agreement)
17
24
"Requisite Banks" means (a) as of any date of determination if the
Commitments are then in effect, Banks having in the aggregate more than 50% of
the combined Commitments then in effect and (b) as of any date of determination
if the Commitments have then been terminated and there are Loans and Letter of
Credit Usage outstanding, Banks holding Loans aggregating more than 50% of the
aggregate outstanding principal amount of the Loans and Letter of Credit Usage.
"Requisite Notice" means, unless otherwise provided herein, (a)
irrevocable written notice to the intended recipient or (b) irrevocable
telephonic notice to the intended recipient, promptly followed by a written
notice to such recipient. Such notices shall be (i) delivered or made to such
recipient at the address, telephone number or facsimile number set forth on
Schedule 10.6 or as otherwise designated by such recipient by Requisite Notice
to the Administrative Agent and (ii) if made by Borrower, given or made by a
Responsible Officer. Any written notice shall be in the form, if any, prescribed
in the applicable section herein and may be given by facsimile provided such
facsimile is promptly confirmed by a telephone call to such recipient.
"Requisite Time" means, with respect to any of the actions listed
below, the time set forth opposite such action on or prior to the date (the
"relevant date") set forth below (all times are California time):
Action Time Date of Action
-------------------------------------------- --------- ------------------
Delivery of Request for Extension of
Credit for, or notice for:
Borrowing and prepayment of Swing Line Loans 10:00 a.m. Same date as such Borrowing or prepayment
Borrowing of, prepayment of, or Conversion into, 8:00 a.m. Same date as such Borrowing, prepayment or
Base Rate Loans: Conversion
Borrowing of, prepayment of, Continuation of, or 10:00 a.m. 3 Business Days prior to such Borrowing,
Conversion into, Offshore Rate Loans (other than prepayment or Conversion
Offshore Currency Loans)
Borrowing of, prepayment of, Continuation of, or 10:00 a.m. 3 Business Days prior to such Borrowing,
Conversion into, Offshore Currency Loans prepayment or Conversion action
Letter of Credit action 10:00 a.m. 2 Business Days prior to such action
Voluntary reduction or termination of Commitments 10:00 a.m. 2 Business Days prior to such reduction or
termination
Borrower's request for increase in Commitments 11:00 a.m. 30 days prior to Increase Date
(Credit Agreement)
18
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Action Time Date of Action
-------------------------------------------- --------- ------------------
Bank's response to request for increase in 11:00 a.m. 5 days prior to Increase Date
Commitments
Bank's commitment to Increase Remainder 11:00 a.m. 1 Business Day prior to Increase Date
Funds made available by Banks or Borrower to 11:00 a.m. On date due
Administrative Agent
"Responsible Officer" means the chief executive officer, president,
chief financial officer, treasurer or assistant treasurer of Borrower, or any
other officer or partner having substantially the same authority and
responsibility. Any document or certificate hereunder that is signed or executed
by a Responsible Officer shall be conclusively presumed to have been authorized
by all necessary corporate, partnership and/or other action on the part of
Borrower and the Responsible Officer shall be conclusively presumed to have
acted on behalf of Borrower.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Securities" means any stock, shares, partnership interests, voting
trust certificates, bonds, debentures, notes, or other evidences of
indebtedness, secured or unsecured, convertible, subordinated or otherwise, or
in general any instruments commonly known as "securities" or any certificates of
interest, shares or participations in temporary or interim certificates for the
purchase or acquisition of, or any right to subscribe to, purchase or acquire,
any of the foregoing.
"Senior Debt Documents" means collectively (a) Borrower's 7.02% Senior
Notes due 2002 in the aggregate outstanding principal amount of $14,300,000 and
(b) Borrower's 7.14% Series A Senior Notes due 2006 in the aggregate outstanding
principal amount of $30,000,000 and Borrower's 7.17% Series B Senior Notes due
2007 in the aggregate outstanding principal amount of $20,000,000, in each case
together with any and all agreements and instruments executed in connection with
the issuance of such Senior Notes, as in effect from time to time and after
giving effect to any waivers thereunder.
"Solvent" means, with respect to any Person that: (a) the total present
fair value and fair salable value of such Person's assets on a going concern
basis is in excess of the total amount of such Person's liabilities, including
contingent liabilities; (b) such Person is able to pay its liabilities and
contingent liabilities as they become due; and (c) such Person does not have
unreasonably small capital with which to engage in such Person's business as
theretofore operated and as proposed to be operated.
"Spot Rate" for a currency means the rate quoted by Bank of America to
the Administrative Agent, rounded upward to the nearest 1/100 of 1%, as the spot
rate for the purchase by Bank of America of such currency with another currency
through its FX Trading
(Credit Agreement)
19
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Office at approximately 8:00 a.m. (San Francisco time) on the date two Business
Days prior to the date as of which the foreign exchange computation is made.
"Standby Letter of Credit" means any standby letter of credit or
similar instrument issued for the account of Borrower for the purpose of
supporting performance, payment, deposit or surety obligations of Borrower or
any of its Subsidiaries.
"Subordinated Debt" means any unsecured Debt of Borrower subordinated
in right of payment to the Obligations pursuant to documentation containing
maturities, amortization schedules, covenants, defaults, remedies, subordination
provisions and other material terms in form and substance satisfactory to the
Administrative Agent and the Requisite Banks.
"Subsidiary" of any Person means any corporation, association,
partnership or other business entity of which at least 50% of the total voting
power of shares of stock or other Securities entitled to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other Subsidiaries
of that Person or a combination thereof.
"Subsidiary Debt" means Debt of a Subsidiary of Borrower owed to any
Person other than Borrower or a Subsidiary of Borrower and reimbursement
obligations under letters of credit issued for the account of a Subsidiary of
Borrower, except for (i) Debt of any Material Subsidiary under the Material
Subsidiary Guaranty, (ii) Debt of Subsidiaries set forth on Schedule 7.1 and any
refinancings thereof permitted pursuant to Section 7.1(e), (iii) Debt of
Subsidiaries permitted by Section 7.1(j), and (iv) Contingent Obligations of
Subsidiaries permitted by Sections 7.5(a), 7.5(d), 7.5(f), 7.5(k) (other than in
respect of letters of credit) and Contingent Obligations constituting
performance bonds.
"Swap Agreement" means any agreement relating to any transaction that
is a rate swap, basis swap, forward rate transaction, commodity swap, commodity
option, equity or equity index swap or option, bond, note or xxxx option,
interest rate option, forward foreign exchange transaction, cap, collar or floor
transaction, currency swap, cross-currency rate swap, swaption, currency option
or any other, similar transaction (including any option to enter into any of the
foregoing).
"Swing Line Lender" means Bank of America, or any Person serving as
successor Administrative Agent hereunder, in its capacity as Swing Line Lender
hereunder.
"Swing Line Loan Commitment" means the commitment of Swing Line Lender
to make Swing Line Loans to Borrower pursuant to subsection 2.1(d).
"Swing Line Loans" means the Loans made by Swing Line Lender to
Borrower pursuant to subsection 2.1(d).
"Swing Line Note" means (i) the promissory note of Borrower issued
pursuant to subsection 2.1(e) on the Closing Date and (ii) any promissory note
issued by Borrower to any successor Swing Line Lender pursuant to subsection
2.1(e), in each case substantially in the form of Exhibit C-3 either as
originally executed or as the same may from time to time be supplemented,
modified, amended, renewed, extended or supplanted.
(Credit Agreement)
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"TARGET Business Day" is a day when TARGET (Trans-European Automated
Real-time Gross settlement Express Transfer system), or any successor thereto,
is scheduled to be open for business.
"Third Party" has the meaning specified in Section 2.6.
"Total Utilization of Commitments" means at any date of determination
the sum of (i) the aggregate principal amount of all Loans outstanding at such
date plus (ii) the Letter of Credit Usage determined as of such date.
"Treaty" means the Treaty establishing the European Economic Community,
being the Treaty of Rome of March 25, 1957 as amended by the Single Xxxxxxxx Xxx
0000 and the Maastricht Treaty (which was signed on February 7, 1992 and came
into force on November 1, 1993) as amended, varied or supplemented from time to
time.
"Tranche A Availability Period" means the period commencing on the
Closing Date and ending on the day before the Tranche A Maturity Date.
"Tranche A Commitment" means, for each Bank, the amount set forth as
such opposite such Bank's name on Schedule 2.1 as the Tranche A Commitment, as
such amount may be reduced pursuant to the terms of this Agreement
(collectively, the "combined Tranche A Commitments"). The respective Tranche A
Pro Rata Shares of the Banks are set forth in Schedule 2.1.
"Tranche A Loan" means a Loan of any type made to Borrower by any Bank
in accordance with its Tranche A Pro Rata Share pursuant to Section 2.1(a).
"Tranche A Loan Note" means the promissory note made by Borrower to a
Bank evidencing Tranche A Loans made by such Bank, substantially in the form of
Exhibit C-1, either as originally executed or as the same may from time to time
be supplemented, modified, amended, renewed, extended or supplanted
(collectively, the "Tranche A Loan Notes").
"Tranche A Maturity Date" means the earlier of (a) October 7, 2004 (as
such date may be extended from time to time pursuant to Section 2.12(a)), and
(b) the date of termination in whole of the Tranche A Commitments pursuant to
Section 2.4 or 8.2.
"Tranche A Pro Rata Share" means, with respect to each Bank, the
percentage of the combined Tranche A Commitments set forth opposite the name of
that Bank on Schedule 2.1.
"Tranche B Availability Period" means the period commencing on the
Closing Date and ending on the day before the Tranche B Maturity Date.
"Tranche B Commitment" means, for each Bank, the amount set forth as
such opposite such Bank's name on Schedule 2.1 as the Tranche B Commitment, as
such amount may be reduced pursuant to the terms of this Agreement
(collectively, the "combined Tranche B Commitments"). The respective Tranche B
Pro Rata Shares of the Banks are set forth in Schedule 2.1.
(Credit Agreement)
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"Tranche B Loan" means a Loan of any type made to Borrower by any Bank
in accordance with its Tranche B Pro Rata Share pursuant to Section 2.1(b).
"Tranche B Loan Note" means the promissory note made by Borrower to a
Bank evidencing Tranche B Loans made by such Bank, substantially in the form of
Exhibit C-2, either as originally executed or as the same may from time to time
be supplemented, modified, amended, renewed, extended or supplanted
(collectively, the "Tranche B Loan Notes").
"Tranche B Maturity Date" means the date that occurs 364 days from the
Closing Date; provided, however, that if any Bank has consented to an extension
request in accordance with Section 2.12, with regard to the then existing
Tranche B Maturity Date, the then existing Tranche B Maturity Date as to such
Bank shall be automatically extended for 364 days from the then existing Tranche
B Maturity Date; provided, however, that, notwithstanding any other provisions
of this Agreement to the contrary, the Tranche B Maturity Date shall occur upon
the earlier termination in whole of the Tranche B Commitments pursuant to
Sections 2.4 or 8.2.
"Tranche B Pro Rata Share" means, with respect to each Bank, the
percentage of the combined Tranche B Commitments set forth opposite the name of
that Bank on Schedule 2.1.
"type" of Loan means (a) a Base Rate Loan or (b) an Offshore Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's
benefit liabilities under Section 4001(a)(16) of ERISA, over the current value
of that Pension Plan's assets, determined in accordance with the assumptions
used for funding the Pension Plan pursuant to Section 412 of the Code for the
applicable plan year.
"Utilization Fee" means an amount equal to (i) for all periods that the
Total Utilization of Commitments is greater than 50% but less than or equal to
75% of the combined Commitments, .05% per annum of the aggregate amount of the
Total Utilization of Commitments, and (ii) for all periods that the Total
Utilization of Commitments is greater than 75% of the combined Commitments, .15%
per annum of the aggregate amount of the Total Utilization of Commitments.
"Wholly-Owned Subsidiary" has the meaning specified in Section 7.8(b).
"Withdrawal Liability" has the meaning given such term under Part I of
Subtitle E of Title IV of ERISA.
1.2 USE OF DEFINED TERMS. Any defined term used in the plural shall
refer to all members of the relevant class, and any defined term used in the
singular shall refer to any one or more of the members of the relevant class.
1.3 ACCOUNTING TERMS. All accounting terms not specifically defined in
this Agreement shall be construed in conformity with, and all financial data
required to be submitted by this Agreement shall be prepared in conformity with,
Generally Accepted Accounting Principles applied on a consistent basis, except
as otherwise specifically prescribed herein. In the event that Generally
Accepted Accounting Principles change during the term of this Agreement such
that the financial covenants would then be calculated in a different manner or
(Credit Agreement)
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with different components, (a) Borrower and the Banks agree to amend this
Agreement in such respects as are necessary to conform those covenants as
criteria for evaluating Borrower's financial condition to substantially the same
criteria as were effective prior to such change in Generally Accepted Accounting
Principles and (b) Borrower shall be deemed to be in compliance with the
covenants contained in the aforesaid Sections during the 90-day period following
any such change in Generally Accepted Accounting Principles if and to the extent
that Borrower would have been in compliance therewith under Generally Accepted
Accounting Principles as in effect immediately prior to such change.
1.4 ROUNDING. Any financial ratios required to be maintained by
Borrower pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed in this
Agreement and rounding the result up or down to the nearest number (with a
rounding up if there is no nearest number) to the number of places by which such
ratio is expressed in this Agreement.
1.5 EXHIBITS AND SCHEDULES. All Exhibits and Schedules to this
Agreement, either as originally existing or as the same may from time to time be
supplemented, modified or amended, are incorporated herein by this reference. A
matter disclosed on any Schedule shall be deemed disclosed on all Schedules.
1.6 REFERENCES TO "BORROWER AND ITS SUBSIDIARIES". Any reference herein
to "Borrower and its Subsidiaries" or the like shall refer solely to Borrower
during such times, if any, as Borrower shall have no Subsidiaries.
1.7 MISCELLANEOUS TERMS. The term "or" is disjunctive; the term "and"
is conjunctive. The term "shall" is mandatory; the term "may" is permissive.
Masculine terms also apply to females; feminine terms also apply to males. The
term "including" is by way of example and not limitation.
1.8 DOLLAR EQUIVALENT AMOUNTS. Any provisions in this Agreement setting
forth amounts in Dollars shall be deemed to refer to the Dollar Equivalent of
such currency on the date of determination pursuant to the definition thereof.
The Administrative Agent shall determine the Dollar Equivalent of Obligations
from time to time in accordance with the definition of "Dollar Equivalent."
SECTION 2
COMMITMENTS; INTEREST, FEES, PAYMENT PROCEDURES
2.1 COMMITTED LOANS.
(a) Subject to the terms and conditions set forth in this Agreement,
each Bank severally agrees, to make, Convert and Continue Tranche A Loans in
Dollars or in Approved Offshore Currencies during the Tranche A Availability
Period as Borrower may request; provided, however, that (i) the Outstanding
Tranche A Obligations of each Bank shall not exceed such Bank's Tranche A
Commitment and (ii) the Outstanding Tranche A Obligations of all the Banks plus
the outstanding principal amount of Swing Line Loans shall not exceed the
combined Tranche A Commitments at any time. Subject to the foregoing and other
terms and conditions
(Credit Agreement)
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30
hereof, Borrower may borrow, Convert, Continue, prepay and reborrow Tranche A
Loans as set forth herein without premium or penalty.
(b) Subject to the terms and conditions set forth in this Agreement,
each Bank severally agrees, to make, Convert and Continue Tranche B Loans in
Dollars or in Approved Offshore Currencies during the Tranche B Availability
Period as Borrower may request; provided, however, that the Outstanding Tranche
B Obligations of each Bank shall not exceed such Bank's Tranche B Commitment and
the Outstanding Tranche B Obligations of all the Banks shall not exceed the
combined Tranche B Commitments at any time. Subject to the foregoing and other
terms and conditions hereof, Borrower may borrow, Convert, Continue, prepay and
reborrow Tranche B Loans as set forth herein without premium or penalty.
(c) Notwithstanding any other provision of this Agreement, no Loan
shall be made in an Approved Offshore Currency if, after giving effect to such
Loan, the Dollar Equivalent at the time the proposed Loan is to be made of all
outstanding Loans made in Approved Offshore Currencies plus the Dollar
Equivalent of the proposed Loan is greater than $50,000,000.
(d) Swing Line Loans.
(i) Subject to the terms and conditions of this Agreement, the
Swing Line Lender hereby agrees, subject to the limitations set forth
below with respect to the maximum amount of Swing Line Loans permitted
to be outstanding from time to time, to make a portion of the Tranche A
Loan Commitments available to Borrower from time to time during the
Tranche A Availability Period by making Swing Line Loans to Borrower in
Dollars in an aggregate amount not exceeding the amount of the Swing
Line Loan Commitment, notwithstanding the fact that such Swing Line
Loans, when aggregated with the Tranche A Loans of the Swing Line
Lender then in effect, may exceed the Swing Line Lender's Tranche A
Loan Commitment. The original amount of the Swing Line Loan Commitment
is $25,000,000; provided that any reduction of the Tranche A Loan
Commitments made pursuant to Section 2.5 which reduces the aggregate
Tranche A Loan Commitments to an amount less than the then current
amount of the Swing Line Loan Commitment shall result in an automatic
corresponding reduction of the Swing Line Loan Commitment to the amount
of the Tranche A Loan Commitments, as so reduced, without any further
action on the part of Borrower, the Administrative Agent or the Swing
Line Lender. Amounts borrowed under this subsection 2.1(d) may be
repaid and reborrowed to but excluding the Tranche A Maturity Date.
(ii) Anything contained in this Agreement to the contrary
notwithstanding, the Swing Line Loans and the Swing Line Loan
Commitment shall be subject to the limitation that Outstanding Tranche
A Obligations plus the outstanding principal amount of Swing Line Loans
shall not at any time exceed the combined Tranche A Loan Commitments
after giving effect to any Borrowing of Swing Line Loans, then in
effect.
(iii) With respect to any Swing Line Loans which have not been
prepaid or repaid by the Borrower pursuant to subsections 2.1(d)(i),
2.4 or 2.5, the Swing Line Lender may, at any time in its sole and
absolute discretion, by delivery to the Administrative Agent (with a
copy to Borrower) by Requisite Time, of a notice (which
(Credit Agreement)
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31
shall be deemed to be a Request for Extension of Credit given by the
Borrower) requesting the Banks to make Tranche A Loans that are Base
Rate Loans on such funding date in an amount equal to the amount of
such Swing Line Loans (the "Refunded Swing Line Loans") outstanding on
the date such notice is given which the Swing Line Lender requests the
Banks to prepay. Anything contained in this Agreement to the contrary
notwithstanding, (a) the proceeds of such Tranche A Loans made by the
Banks other than the Swing Line Lender shall be immediately delivered
by the Administrative Agent to the Swing Line Lender (and not to
Borrower) and applied to repay a corresponding portion of the Refunded
Swing Line Loans and (b) on the day such Tranche A Loans are made, the
Swing Line Lender's Tranche A Pro Rata Share of the Refunded Swing Line
Loans shall be deemed to be paid with the proceeds of a Tranche A Loan
made by the Swing Line Lender, and such portion of the Swing Line Loans
deemed to be so paid shall no longer be outstanding as Swing Line Loans
and shall no longer be due under the Swing Line Note, if any, of the
Swing Line Lender but shall instead constitute part of the Swing Line
Lender's outstanding Tranche A Loans and shall be due under the Tranche
A Loan Note, if any, of the Swing Line Lender. Borrower hereby
authorizes the Administrative Agent and the Swing Line Lender to charge
Borrower's accounts with the Administrative Agent and the Swing Line
Lender (up to the amount available in each such account) in order to
immediately pay the Swing Line Lender the amount of the Refunded Swing
Line Loans to the extent the proceeds of such Tranche A Loans made by
the Banks, including the Tranche A Loan deemed to be made by the Swing
Line Lender, are not sufficient to repay in full the Refunded Swing
Line Loans. If any portion of any such amount paid (or deemed to be
paid) to the Swing Line Lender should be recovered by or on behalf of
Borrower from the Swing Line Lender in bankruptcy, by assignment for
the benefit of creditors or otherwise, the loss of the amount so
recovered shall be ratably shared among all Banks.
(iv) If for any reason (a) Tranche A Loans are not made upon the
request of the Swing Line Lender as provided in the immediately
preceding paragraph (iii) in an amount sufficient to repay any amounts
owed to the Swing Line Lender in respect of any outstanding Swing Line
Loans or (b) the Tranche A Loan Commitments are terminated at a time
when any Swing Line Loans are outstanding, each Bank shall be deemed
to, and hereby agrees to, have purchased a participation in such
outstanding Swing Line Loans in an amount equal to its Tranche A Pro
Rata Share (calculated, in the case of the foregoing clause (b),
immediately prior to such termination of the Tranche A Loan
Commitments) of the unpaid amount of such Swing Line Loans together
with accrued interest thereon. Upon one Business Day's notice from the
Swing Line Lender, each Bank shall deliver to the Swing Line Lender an
amount equal to its respective participation in same day funds. In
order to further evidence such participation (and without prejudice to
the effectiveness of the participation provisions set forth above),
each Bank agrees to enter into a separate participation agreement at
the request of the Swing Line Lender in form and substance reasonably
satisfactory to Swing Line Lender. In the event any Bank fails to make
available to the Swing Line Lender the amount of such Bank's
participation as provided in this paragraph, the Swing Line Lender
shall be entitled to recover such amount on demand from such Bank
together with interest thereon at the rate customarily used by the
Swing Line Lender for the correction of errors among banks for three
Business Days and thereafter at the Base Rate. In the event the Swing
Line Lender receives a payment of
(Credit Agreement)
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any amount in which other Banks have purchased participations as
provided in this paragraph, the Swing Line Lender shall promptly
distribute to each such other Bank its Tranche A Pro Rata Share of such
payment.
(v) Anything contained herein to the contrary notwithstanding, each
Bank's obligation to make Tranche A Loans for the purpose of repaying
any Refunded Swing Line Loans pursuant to paragraph (iii) above and
each Bank's obligation to purchase a participation in any unpaid Swing
Line Loans pursuant to the immediately preceding paragraph (iv) shall
be absolute and unconditional and shall not be affected by any
circumstance, including without limitation (a) any set-off,
counterclaim, recoupment, defense or other right which such Bank may
have against the Swing Line Lender, Borrower or any other Person for
any reason whatsoever; (b) the occurrence or continuation of an Event
of Default or a Default; (c) any adverse change in the business,
operations, properties, assets, condition (financial or otherwise) or
prospects of Borrower or any of its Subsidiaries; (d) any breach of
this Agreement or any other Loan Document by any party thereto; or (e)
any other circumstance, happening or event whatsoever, whether or not
similar to any of the foregoing; provided that such obligations of each
Bank are subject to the condition that (x) the Swing Line Lender
believed in good faith that all conditions under Section 4 to the
making of the applicable Refunded Swing Line Loans or other unpaid
Swing Line Loans, as the case may be, were satisfied at the time such
Refunded Swing Line Loans or unpaid Swing Line Loans were made or (y)
the satisfaction of any such condition not satisfied had been waived in
accordance with subsection 10.02 prior to or at the time such Refunded
Swing Line Loans or other unpaid Swing Line Loans were made.
(e) Loans made by each Bank shall be evidenced by one or more loan
accounts or records maintained by such Bank in the ordinary course of business.
Upon the request of any Bank made through the Administrative Agent, such Bank's
Tranche A Loans may be evidenced by one or more Tranche A Loan Notes, such
Bank's Tranche B Loans may be evidenced by one or more Tranche B Loan Notes, and
the Swing Line Lender's Swing Line Loans may be evidenced by a Swing Line Note,
instead of or in addition to loan accounts. Each such Bank may attach schedules
to its Note(s) and endorse thereon the date, currency, amount and maturity of
its Tranche A or Tranche B Loans, respectively, and payments with respect
thereto. Such loan accounts, records or Notes shall be conclusive absent
manifest error of the amount of such Loans and payments thereon. Any failure so
to record or any error in doing so shall not, however, limit or otherwise affect
the obligation of Borrower to pay any amount owing with respect to the Loans.
2.2 BORROWINGS, CONVERSIONS AND CONTINUATIONS OF LOANS.
(a) Borrower may irrevocably request a Borrowing, Conversion or
Continuation of Loans in a Minimum Amount therefor by delivering a duly
completed Request for Extension of Credit therefor by Requisite Notice to the
Administrative Agent not later than the Requisite Time therefor. All Borrowings,
Conversions or Continuations shall constitute Base Rate Loans unless properly
and timely otherwise designated as set forth in the preceding sentence.
(Credit Agreement)
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(b) Promptly following receipt of a Request for Extension of Credit,
the Administrative Agent shall notify each Bank of its Tranche A or Tranche B
Pro Rata Share, as the case may be, of the Tranche A and/or Tranche B Loan
requested by Borrower thereof by Requisite Notice. If any Bank promptly notifies
the Administrative Agent that it is unable, in its sole discretion, to fund an
Offshore Currency Loan in the requested currency, such request for Extension of
Credit shall be deemed withdrawn. In the case of a Borrowing of Loans, each Bank
shall make the funds for its Loan available to the Administrative Agent in the
currency of such Loan at the Agent's Office not later than the Requisite Time
therefor on the Business Day specified in such Request for Extension of Credit.
Upon satisfaction or waiver of the applicable conditions set forth in Section 4,
all funds so received shall be made available to Borrower in like funds
received.
(c) The Administrative Agent shall promptly notify Borrower and the
Banks of the Offshore Rate and, if an Offshore Currency Loan, the Dollar
Equivalent thereof, applicable to any Offshore Rate Loan upon determination
thereof.
(d) Unless the Administrative Agent and the Requisite Banks otherwise
consent, Loans with no more than ten different Interest Periods shall be
outstanding at any one time.
(e) No Loans other than Base Rate Loans may be requested or continued
during the existence of a Default or Event of Default. During the existence of a
Default or Event of Default, the Requisite Banks may determine that any or all
of the then outstanding Loans other than Base Rate Loans shall be Converted to
Base Rate Loans. Such Conversion shall be effective upon notice to Borrower from
the Administrative Agent and shall continue so long as such Default or Event of
Default continues to exist.
(f) If a Loan is to be made on the same date that another Loan is due
and payable, Borrower or the Banks, as the case may be, shall make available to
the Administrative Agent the net amount of funds giving effect to both such
Loans and the effect for purposes of this Agreement shall be the same as if
separate transfers of funds had been made with respect to each such Loan.
(g) The failure of any Bank to make any Loan on any date shall not
relieve any other Bank of any obligation to make a Loan on such date, but no
Bank shall be responsible for the failure of any other Bank to so make its Loan.
2.3 LETTERS OF CREDIT.
(a) Subject to the terms and conditions hereof, at any time and from
time to time from the Closing Date through the Tranche A Maturity Date, the
Issuing Bank shall issue, supplement, modify, amend, renew, or extend Letters of
Credit in Dollars or in Approved Offshore Currencies under the Tranche A
Commitments as Borrower may request; provided, however, that (i) the Outstanding
Tranche A Obligations of each Bank shall not exceed such Bank's Tranche A
Commitment and the Outstanding Tranche A Obligations of all the Banks plus the
outstanding principal amount of the Swing Line Loans shall not exceed the
combined Tranche A Commitments at any time and (ii) the aggregate outstanding
Letter of Credit Usage shall not exceed the Dollar Equivalent of $150,000,000 at
any time. Each Letter of Credit shall be in a
(Credit Agreement)
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form acceptable to the Issuing Bank and shall not violate any policies of the
Issuing Bank. The Issuing Bank shall not be obligated to issue a Letter of
Credit denominated in a foreign currency if and so long as the Issuing Bank
determines that foreign currency market circumstances make it unlawful,
impossible or impracticable for the Issuing Bank to issue such Letter of Credit.
Unless all the Banks, the Administrative Agent and the Issuing Bank otherwise
consent in a writing delivered to the Administrative Agent, and subject to
permitting "evergreen" Letters of Credit as provided in subsection (b) below, no
Letter of Credit shall expire later than the earlier of (x) the Tranche A
Maturity Date and (y) five years after its date of original issuance.
(b) Borrower may irrevocably request the issuance, supplement,
modification, amendment, renewal, or extension of a Letter of Credit by
delivering a duly completed Letter of Credit Application therefor to the Issuing
Bank, with a copy to the Administrative Agent, by Requisite Notice not later
than the Requisite Time therefor. Unless the Administrative Agent notifies the
Issuing Bank that such Letter of Credit Action is not permitted hereunder or the
Issuing Bank determines that such Letter of Credit Action is contrary to any
Laws or policies of the Issuing Bank or does not otherwise conform to the
requirements of this Agreement, the Issuing Bank shall effect such Letter of
Credit Action. Letters of Credit may have automatic extension or renewal
provisions ("evergreen" Letters of Credit) so long as the Issuing Bank has the
right to terminate such evergreen Letters of Credit no less frequently than
annually within a notice period to be agreed upon at the time each such Letter
of Credit is issued. This Agreement shall control in the event of any conflict
with any Letter of Credit Application.
(c) Upon the issuance of a Letter of Credit, each Bank shall be deemed
to have purchased a pro rata participation in such Letter of Credit, as from
time to time supplemented, amended, renewed, or extended, from the Issuing Bank
in an amount equal to that Bank's Tranche A Pro Rata Share. Without limiting the
scope and nature of each Bank's participation in any Letter of Credit, to the
extent that the Issuing Bank has not been reimbursed by Borrower for any payment
required to be made by the Issuing Bank under any Letter of Credit, each Bank
shall, pro rata according to its Tranche A Pro Rata Share, reimburse the Issuing
Bank through the Administrative Agent promptly upon demand for the amount of
such payment. The obligation of each Bank to so reimburse the Issuing Bank shall
be absolute and unconditional and shall not be affected by the occurrence of an
Event of Default or any other occurrence or event. Any such reimbursement shall
not relieve or otherwise impair the obligation of Borrower to reimburse the
Issuing Bank for the amount of any payment made by the Issuing Bank under any
Letter of Credit together with interest as hereinafter provided.
(d) Borrower agrees to pay to the Issuing Bank through the
Administrative Agent an amount equal to any payment made by the Issuing Bank
with respect to each Letter of Credit within one Business Day after demand made
by the Issuing Bank therefor. The principal amount of any such payment shall
bear interest pursuant to the related Letter of Credit Application therefor and
shall be used to reimburse the Issuing Bank for the payment made by it under the
Letter of Credit. Each Bank that has reimbursed the Issuing Bank for its Tranche
A Pro Rata Share of any payment made by the Issuing Bank under a Letter of
Credit shall thereupon acquire a pro rata participation, to the extent of such
reimbursement, in the claim of the Issuing Bank against Borrower under this
Section and shall share, in accordance with that pro rata participation, in any
payment made by Borrower with respect to such claim.
(Credit Agreement)
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(e) If Borrower fails to make the payment required by subsection (d)
above within the time period therein set forth, in lieu of the reimbursement to
the Issuing Bank under such subsection, the Issuing Bank may (but is not
required to), without notice to or the consent of Borrower, instruct the
Administrative Agent to cause Loans to be made by the Banks in an aggregate
amount equal to the amount paid by the Issuing Bank with respect to that Letter
of Credit and, for this purpose, the conditions precedent set forth in Section 4
shall not apply. The proceeds of such Loans shall be paid to the Issuing Bank to
reimburse it for the payment made by it under the Letter of Credit. Such Loans
shall be payable upon demand and shall bear interest at the Default Rate.
(f) Once an evergreen Letter of Credit is issued, Borrower shall not be
required to annually request that the Issuing Bank permit the renewal thereof.
Borrower, the Administrative Agent and the Banks authorize (but may not require)
the Issuing Bank to, in its sole discretion, permit the renewal of such
evergreen Letter of Credit if such Letter of Credit could be issued in the first
instance at such time.
(g) The obligation of Borrower to pay to the Issuing Bank the amount of
any payment made by the Issuing Bank under any Letter of Credit shall be
absolute, unconditional, and irrevocable. Without limiting the foregoing,
Borrower's obligations shall not be affected by any of the following
circumstances:
(i) any lack of validity or enforceability of the Letter of Credit,
this Agreement, or any other agreement or instrument relating thereto;
(ii) any amendment or waiver of or any consent to departure from
the Letter of Credit, this Agreement, or any other agreement or
instrument relating thereto, with the consent of Borrower;
(iii) the existence of any claim, setoff, defense, or other rights
which Borrower may have at any time against the Issuing Bank, the
Administrative Agent or any Bank, any beneficiary of the Letter of
Credit (or any persons or entities for whom any such beneficiary may be
acting) or any other Person, whether in connection with the Letter of
Credit, this Agreement, or any other agreement or instrument relating
thereto, or any unrelated transactions;
(iv) any demand, statement, or any other document presented under
the Letter of Credit proving to be forged, fraudulent, invalid, or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect whatsoever so long as any such document
appeared to comply with the terms of the Letter of Credit;
(v) payment by the Issuing Bank in good faith under the Letter of
Credit against presentation of a draft or any accompanying document
which does not strictly comply with the terms of the Letter of Credit;
(vi) the existence, character, quality, quantity, condition,
packing, value or delivery of any property purported to be represented
by documents presented in connection with any Letter of Credit or for
any difference between any such property and
(Credit Agreement)
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the character, quality, quantity, condition, or value of such property
as described in such documents;
(vii) the time, place, manner, order or contents of shipments or
deliveries of property as described in documents presented in
connection with any Letter of Credit or the existence, nature and
extent of any insurance relative thereto;
(viii) the solvency or financial responsibility of any party
issuing any documents in connection with a Letter of Credit;
(ix) any failure or delay in notice of shipments or arrival of any
property;
(x) any error in the transmission of any message relating to a
Letter of Credit not caused by the Issuing Bank, or any delay or
interruption in any such message;
(xi) any error, neglect or default of any correspondent of the
Issuing Bank in connection with a Letter of Credit;
(xii) any consequence arising from acts of God, wars,
insurrections, civil unrest, disturbances, labor disputes, emergency
conditions or other causes beyond the control of the Issuing Bank;
(xiii) so long as the Issuing Bank in good faith determines that
the contract or document appears to comply with the terms of the Letter
of Credit, the form, accuracy, genuineness or legal effect of any
contract or document referred to in any document submitted to the
Issuing Bank in connection with a Letter of Credit; and
(xiv) where the Issuing Bank has acted in good faith and observed
general banking usage, any other circumstances whatsoever.
(h) Each Letter of Credit shall also be governed by the most recent
version of the Uniform Customs and Practice for Documentary Credits published by
the International Chamber of Commerce in effect when such Letter of Credit was
issued.
(i) With respect to each outstanding Letter of Credit, Borrower shall
pay to the Administrative Agent, for the account of each of the Banks in
accordance with its Tranche A Pro Rata Share, a fee equal to the following
percent of the average daily maximum amount available to be drawn under such
Letter of Credit, calculated in accordance with the following table:
Type of Letter of Credit Fee
---------------------------------- -----------------------------------------------
Performance Letters of Credit one-half of the Applicable Amount for
Financial Letters of Credit, payable in arrears
Financial Letters of Credit Applicable Amount therefor, payable in arrears
Commercial Letters of Credit Greater of (i) 0.125% of face amount and (ii)
$400, payable upon issuance
(Credit Agreement)
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Letter of Credit fees for Performance Letters of Credit and Financial
Letters of Credit shall accrue from the issuance of such Letter of Credit until
its expiration or termination and shall be payable quarterly in arrears on each
Quarterly Payment Date and such termination or expiration date. Such fees shall
be calculated quarterly in arrears; if there is any change in the Applicable
Amount during any quarter, the average daily undrawn face amount shall be
computed and multiplied by the Applicable Amount separately for each period that
such Applicable Amount was in effect during such quarter. These fees are
nonrefundable.
(j) Borrower shall pay to the Administrative Agent for the sole account
of the Issuing Bank a fronting fee equal to 12.5 basis points per annum on the
maximum amount available to be drawn under such Letter of Credit. In addition,
Borrower shall pay directly to the Issuing Bank for its sole account its
customary documentary and processing charges in accordance with its standard
schedule, as from time to time in effect, for any issuance, amendment, transfer,
supplement, modification, renewal, extension or other action relating to a
Letter of Credit.
2.4 PREPAYMENTS.
(a) Upon Requisite Notice to the Administrative Agent not later than
the Requisite Time therefor, Borrower may at any time and from time to time
voluntarily prepay Loans in the Minimum Amount therefor in the currency of such
Loan. The Administrative Agent will promptly notify each Bank of such Bank's
Tranche A or Tranche B Pro Rata Share, as the case may be, of such prepayment.
(b) If Borrower or any of its Subsidiaries applies any Excess Net
Proceeds in accordance with Section 7.6(g) to prepay outstanding Debt under this
Agreement, Borrower shall apply an amount equal to such Excess Net Proceeds
first to prepay Tranche B Loans in full, second to prepay Tranche A Loans in
full, third to prepay Swing Line Loans in full, and fourth to deposit cash to be
held by the Administrative Agent in an interest-bearing cash collateral account
as collateral for any Letter of Credit Usage. The combined Commitments shall
also be reduced by an amount equal to such Excess Net Proceeds in accordance
with Section 2.5(a).
(c) If for any reason the Outstanding Tranche A Obligations plus the
outstanding principal amount of Swing Line Loans exceed the combined Tranche A
Commitments (including, without limitation, by reason of the Administrative
Agent from time to time determining the Dollar Equivalent of outstanding
Obligations in accordance with Section 1.8) as in effect or as reduced or
because of any limitation set forth in this Agreement or otherwise, Borrower
shall immediately first prepay the Swing Line Loans in full, second prepay
Tranche A Loans in full, and third deposit cash to be held by the Administrative
Agent in an interest-bearing cash collateral account as collateral for any
Letter of Credit Usage, in an aggregate amount equal to such excess.
(d) If for any reason the Outstanding Tranche B Obligations exceed the
combined Tranche B Commitments (including, without limitation, by reason of the
Administrative Agent from time to time determining the Dollar Equivalent of
outstanding Obligations in accordance with Section 1.8) as in effect or as
reduced or because of any limitation set forth in this
(Credit Agreement)
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Agreement or otherwise, Borrower shall immediately prepay Tranche B Loans in an
aggregate amount equal to such excess.
(e) Any prepayment of a Loan other than a Base Rate Loan shall be
accompanied by all accrued interest thereon, together with the costs set forth
in Section 3.6.
(f) Each payment or prepayment of outstanding Loans must be made
ratably among all Banks having Tranche A Loans and each payment or prepayment of
outstanding Tranche B Loans must be made ratably among all Banks having Tranche
B Loans.
2.5 MANDATORY AND VOLUNTARY REDUCTION OR TERMINATION OF TRANCHE A AND
TRANCHE B COMMITMENTS.
(a) Upon any date that the Loans are prepaid pursuant to Section
2.4(b), the combined Tranche A Commitments shall automatically be reduced as of
the date of such required prepayment by an amount equal to such required
prepayment of Tranche A Loans, the combined Tranche B Commitments shall
automatically be reduced as of the date of such required prepayment by an amount
equal to such required prepayment of Tranche B Loans, and the Swing Line Loan
Commitment shall automatically be reduced as of the date of such required
prepayment by an amount equal to such required prepayment of Swing Line Loans.
(b) Upon Requisite Notice to the Administrative Agent not later than
the Requisite Time therefor, Borrower shall have the right, at any time and from
time to time, without penalty or charge, to permanently and irrevocably, reduce
the combined Tranche A Commitments or the combined Tranche B Commitments in a
Minimum Amount therefor, or terminate the then unused portion of the combined
Tranche A Commitments or the combined Tranche B Commitments.
(c) The Administrative Agent shall promptly notify the Banks of any
reduction or the termination of the Tranche A or Tranche B Commitments under
this Section. Any mandatory or voluntary reduction or termination of the
combined Tranche A Commitments or combined Tranche B Commitments shall be
accompanied by payment of all accrued and combined unpaid facility fees with
respect to the portion of the combined Tranche A Commitments or combined Tranche
B Commitments being reduced or terminated. Each Bank's Tranche A Commitments or
Tranche B Commitment shall be reduced by an amount equal to such Bank's Tranche
A Pro Rata Share or Tranche B Pro Rata Share, as the case may be, times the
amount of such reduction.
2.6 OPTIONAL INCREASE OF THE TRANCHE A AND TRANCHE B COMMITMENTS.
(a) From time to time, Borrower may propose to increase the combined
Tranche A and Tranche B Commitments by an aggregate amount of not less than the
Minimum Amount therefor (a "Proposed Combined Commitments Increase") in the
manner set forth below; provided that (i) the then current combined Tranche A
Commitments plus the increase in the Tranche A Commitments included in the
Proposed Combined Commitments Increase shall not be greater than the Maximum
Permitted Combined Tranche A Commitments and the then current combined Tranche B
Commitments plus the increase in the Tranche B Commitments included in the
Proposed Combined Commitments Increase shall not be greater than the Maximum
Permitted Combined Tranche B Commitments; (ii) the ratio of the increase in the
(Credit Agreement)
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combined Tranche A Commitments to the increase in the combined Tranche B
Commitments included in the Proposed Combined Commitments Increase is equal to
the then current ratio of the Tranche A Commitments to the Tranche B
Commitments; (iii) immediately prior to and after giving effect to the Proposed
Combined Commitments Increase no event has occurred and is continuing that
constitutes an Event of Default or Default; and (iv) Borrower shall pay any
costs payable under Section 3.6 if and to the extent any Offshore Rate Loans are
prepaid on the effective date of such increase (the "Increase Date").
(b) Borrower may request a Proposed Combined Commitments Increase by
delivering to the Administrative Agent, by Requisite Notice not later than the
Requisite Time therefor. Such notice (i) shall specify the Proposed Combined
Commitments Increase and the proposed Increase Date, and (ii) may specify
Eligible Assignees that are not Banks (the "Third Parties"), to whom Borrower
desires to offer all or a portion of the Proposed Combined Commitments Increase,
to the extent not committed to by the existing Banks. The Administrative Agent
shall in turn promptly notify each Bank by sending each Bank a copy of such
notice.
(c) Each Bank, in its sole discretion, may irrevocably offer to commit
to all or a portion of the Proposed Combined Commitments Increase in increments
of $1,000,000 (the "Proposed Increased Commitment") by notifying the
Administrative Agent (which shall give prompt notice thereof to Borrower) by
Requisite Notice not later than the Requisite Time therefor. The ratio of the
increase in the combined Tranche A Commitments to the increase in the combined
Tranche B Commitments included in each Bank's Proposed Increased Commitment
shall be equal to the then current ratio of the Tranche A Commitments to the
Tranche B Commitments. If the amount of Proposed Increased Commitments exceeds
the Proposed Combined Commitments Increase, such Proposed Increased Commitments
shall be allocated on a pro rata basis based on the ratio of each Bank's
Proposed Increased Commitment, if any, to the aggregate of all Proposed
Increased Commitments. Each Bank that submits a Proposed Increased Commitment
shall execute and deliver to the Administrative Agent an Increased Commitment
Acceptance therefor.
(d) If any portion of the Proposed Combined Commitments Increase not
committed to by existing Banks equals or exceeds $5,000,000 (the "Increase
Remainder"), the Administrative Agent shall notify each Third Party thereof four
Business Days before the Increase Date. Each Third Party may irrevocably commit
to all or a portion of the Increase Remainder in a minimum principal amount of
$5,000,000 (a "Proposed New Commitment") by notifying the Administrative Agent
by Requisite Notice (who shall give prompt notice thereof to Borrower) by the
Requisite Time therefor. The ratio of the increase in the combined Tranche A
Commitments to the increase in the combined Tranche B Commitments included in
each Third Party's Proposed New Commitment shall be equal to the then current
ratio of the Tranche A Commitments to the Tranche B Commitments. If there are
Third Parties willing to commit to more than the Increase Remainder, Borrower,
in consultation with the Administrative Agent, may allocate the Increase
Remainder in its sole discretion, but keeping the $5,000,000 minimum
requirement. Each Third Party that submits a Proposed New Commitment shall
execute and deliver to the Administrative Agent a New Commitment Acceptance
therefor. By executing and delivering a New Commitment Acceptance, each Third
Party shall be deemed to have agreed with the matters set forth in Section
10.8(c)(iii)-(vi).
(Credit Agreement)
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(e) If the commitments of the Banks and Third Parties to the Proposed
Combined Commitments Increase equal the Proposed Combined Commitments Increase,
the combined Tranche A Commitments and the Tranche B Commitments shall be
increased by the Proposed Combined Commitment Increase on the Increase Date
provided the Administrative Agent shall have received on or before the Increase
Date certified copies of the resolutions of the Executive Committee of the Board
of Directors of Borrower approving such increase of the combined Tranche A
Commitments and the Tranche B Commitments, and of all documents evidencing other
necessary corporate action, if any, with respect to such increase. Upon any
Third Party paying an assignment fee of $3,500 to the Administrative Agent, any
Third Parties shall become a Bank hereunder, and the Administrative Agent shall,
promptly following the effective date thereof, provide to Borrower and the Banks
a revised Schedule 10.6 giving effect thereto. Borrower agrees that it shall
execute and deliver upon request to such Third Party, one or more Notes
evidencing that assignee Bank's Tranche A Pro Rata Share and Tranche B Pro Rata
Share.
(f) If, after giving effect to the Proposed Combined Commitments
Increase, any Bank's revised Tranche A Pro Rata Share of the combined Tranche A
Commitments or Tranche B Pro Rata Share of the combined Tranche B Commitments is
different than its share of Outstanding Tranche A Obligations or Outstanding
Tranche B Obligations, respectively, the Outstanding Tranche A Obligations or
Tranche B Obligations, respectively, shall be reallocated among the Banks as
follows. On the Increase Date Borrower shall be deemed to have prepaid all
outstanding Tranche A Loans or Tranche B Loans, respectively, in accordance with
Section 2.4 and reborrowed all Tranche A Loans or Tranche B Loans, respectively,
in accordance with Section 2.2 from all Banks ratably in accordance with their
revised Tranche A Pro Rata Shares or Tranche B Pro Rata Shares, respectively.
Each Bank having a decreased Pro Rata Share (a "Selling Bank") agrees to sell
and assign to each other Bank (each a "Buying Bank") such that, after giving
effect to such assignments, each Bank's share of all Outstanding Obligations
equals its revised Tranche A Pro Rata Share or Tranche B Pro Rata Share,
respectively. The Administrative Agent shall distribute to each Selling Bank an
amount equal to the difference between its Tranche A Loans or Tranche B Loans so
prepaid with interest accrued thereon through the date of such prepayment and,
in the case of Loans other than Base Rate Loans, costs set forth in Section 3.6,
and the new Tranche A Loans or Tranche B Loans deemed to have been made by it.
Such payments shall be deemed to be a payment of the Tranche A Loans or Tranche
B Loans by Borrower on the date such payment is received.
(g) If the commitments of the Banks and Third Parties to the Proposed
Combined Commitments Increase are less than the Proposed Combined Commitments
Increase, the combined Tranche A Commitments and Tranche B Commitments shall not
be increased; provided, however, that, unless the combined Proposed Increased
Commitments and Proposed New Commitments is zero, Borrower may again propose to
increase the combined Tranche A Commitments and Tranche B Commitments pursuant
to the terms of this Section 2.6.
2.7 PRINCIPAL AND INTEREST.
(a) If not sooner paid, Borrower shall pay, and promises to pay, the
outstanding principal amount of each Tranche A Loan and Swing Line Loan in the
currency of such Tranche A Loan and Swing Line Loan on the Tranche A Maturity
Date and shall pay, and promises to
(Credit Agreement)
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pay, the outstanding principal amount of each Tranche B Loan in the currency of
such Tranche B Loan on the Tranche B Maturity Date.
(b) Subject to subsection (e), Borrower shall pay interest on the
unpaid principal amount of the Tranche A Loans (before and after default, before
and after maturity, before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law) in the currency of
such Tranche A Loan from the date borrowed until paid in full (whether by
acceleration or otherwise) on each Interest Payment Date for each type of
Tranche A Loan at a rate per annum equal to the applicable interest rate
determined in accordance with the definition of such type of Tranche A Loan,
plus, if applicable, the Applicable Amount.
(c) Subject to subsection (e), Borrower shall pay interest on the
unpaid principal amount of the Tranche B Loans (before and after default, before
and after maturity, before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law) in the currency of
such Tranche B Loan from the date borrowed until paid in full (whether by
acceleration or otherwise) on each Interest Payment Date for each type of
Tranche B Loan at a rate per annum equal to the applicable interest rate
determined in accordance with the definition of such type of Tranche B Loan,
plus, if applicable, the Applicable Amount.
(d) Subject to subsection (e), Borrower shall pay interest on the
unpaid principal amount of the Swing Line Loans (before and after default,
before and after maturity, before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law) in the currency of
such Swing Line Loan from the date borrowed until paid in full (whether by
acceleration or otherwise) on each Interest Payment Date at a rate per annum
equal to the Base Rate, plus, if applicable, the Applicable Amount.
(e) If any amount payable by Borrower under any Loan Document is not
paid when due (without regard to any applicable grace periods), it shall
thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate. Accrued and unpaid interest on past due amounts
(including, without limitation, interest on past due interest) shall be
compounded monthly, on the last day of each calendar month, to the fullest
extent permitted by applicable Laws and payable upon demand.
2.8 FEES.
(a) Facility Fee. Borrower shall pay to the Administrative Agent, for
the ratable accounts of the Banks pro rata (i) according to their Tranche A Pro
Rata Shares, a facility fee equal to the Applicable Amount times the combined
Tranche A Commitments, regardless of usage, (ii) according to their Tranche B
Pro Rata Shares, a facility fee equal to the Applicable Amount times the
combined Tranche B Commitments, regardless of usage. The facility fee shall
accrue from the Closing Date until the Tranche A Maturity Date or the Tranche B
Maturity Date, as applicable, and shall be payable quarterly in arrears on each
Quarterly Payment Date and on the Tranche A Maturity Date and the Tranche B
Maturity Date, as applicable. The facility fee shall be calculated quarterly in
arrears; if there is any change in the Applicable Amount during any quarter, the
average daily amount shall be computed and multiplied by the Applicable Amount
separately for each period that such Applicable Amount was in effect during such
quarter.
(Credit Agreement)
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(b) Utilization Fee. Borrower shall pay to the Administrative Agent,
for the ratable accounts of the Banks pro rata according to their Pro Rata
Share, the Utilization Fee, payable quarterly in arrears on each Quarterly
Payment Date and on the later of the Tranche A Maturity Date and the Tranche B
Maturity Date.
(c) Administrative Fees. Borrower shall pay to the Administrative Agent
an administrative fee in such amounts and at such times as heretofore agreed
upon by letter agreement dated August 24, 1999 between Borrower and the
Administrative Agent. The administrative fee is for the services to be performed
by the Administrative Agent in acting as Administrative Agent and is fully
earned on the date paid. The administrative fee paid to the Administrative Agent
is solely for its own account and is nonrefundable.
2.9 COMPUTATION OF INTEREST AND FEES. Computation of interest on Base
Rate Loans shall be calculated on the basis of a year of 365 or 366 days, as the
case may be, and the actual number of days elapsed; computation of interest on
all other types of Loans and all fees under this Agreement shall be calculated
on the basis of a year of 360 days and the actual number of days elapsed, which
results in a higher yield to the Banks than a method based on a year of 365 or
366 days. Interest shall accrue on each Loan for the day on which the Loan is
made; interest shall not accrue on a Loan, or any portion thereof, for the day
on which the Loan or such portion is paid. Any Loan that is repaid on the same
day on which it is made shall bear interest for one day. Notwithstanding
anything in this Agreement to the contrary, interest in excess of the maximum
amount permitted by applicable Laws shall not accrue or be payable hereunder,
and any amount paid as interest hereunder which would otherwise be in excess of
such maximum permitted amount shall instead be treated as a payment of
principal.
2.10 MANNER AND TREATMENT OF PAYMENTS AMONG THE BANKS, BORROWER AND THE
ADMINISTRATIVE AGENT.
(a) Unless otherwise provided herein, all payments by Borrower or any
Bank hereunder shall be made to the Administrative Agent at the Agent's Office
not later than the Requisite Time for such type of payment without condition or
deduction for, any counterclaim, defense, recoupment or setoff. All payments
received after such Requisite Time shall be deemed received on the next
succeeding Business Day.
(b) Upon satisfaction of any applicable terms and conditions set forth
herein, the Administrative Agent shall promptly make any amounts received in
accordance with the prior subsection available in like funds received as
follows: (i) if payable to Borrower, by crediting the Designated Deposit
Account, and (ii) if payable to any Bank, by wire transfer to such Bank at the
address specified in Schedule 10.6. The Administrative Agent's determination, or
any Bank's determination not contradictory thereto, of any amount payable
hereunder shall be conclusive in the absence of manifest error.
(c) Subject to the definition of "Interest Period," if any payment to
be made by Borrower shall come due on a day other than a Business Day, payment
shall instead be considered due on the next succeeding Business Day and the
extension of time shall be reflected in computing interest and fees.
(Credit Agreement)
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(d) Unless Borrower or any Bank has notified the Administrative Agent
prior to the date any payment to be made by it is due, that it does not intend
to remit such payment, the Administrative Agent may, in its discretion, assume
that Borrower or the Bank, as the case may be, has timely remitted such payment
and may, in its discretion and in reliance thereon, make available such payment
to the Person entitled thereto. If such payment was not in fact remitted to the
Administrative Agent, then:
(i) if Borrower failed to make such payment, each Bank shall
forthwith on demand repay to the Administrative Agent the amount of
such assumed payment made available to such Bank, together with
interest thereon in respect of each day from and including the date
such amount was made available by the Administrative Agent to such Bank
to the date such amount is repaid to the Administrative Agent at the
Federal Funds Rate or, in the case of a payment in an Approved Offshore
Currency, the Offshore Currency Overnight Rate; and
(ii) if any Bank failed to make such payment, such Bank shall on
the Business Day following such Borrowing Date pay to the
Administrative Agent the amount of such assumed payment made available
to Borrower, together with interest thereon in respect of each day from
and including the date such amount was made available by the
Administrative Agent to Borrower to the date such amount is paid to the
Administrative Agent at the Federal Funds Rate or, in the case of a
payment in an Approved Offshore Currency, the Offshore Currency
Overnight Rate. Nothing herein shall be deemed to relieve any Bank from
its obligation to fulfill its Tranche A Commitment or Tranche B
Commitment or to prejudice any rights which the Administrative Agent or
Borrower may have against any Bank as a result of any default by such
Bank hereunder.
2.11 FUNDING SOURCES. Nothing in this Agreement shall be deemed to
obligate any Bank to obtain the funds for any Loan in any particular place or
manner or to constitute a representation by any Bank that it has obtained or
will obtain the funds for any Loan in any particular place or manner.
2.12 EXTENSION OF TRANCHE A AND TRANCHE B MATURITY DATES.
(a) Tranche A Maturity Date. (i) At the request of Borrower and with
the written consent of all of the Banks having a Tranche A Commitment (which may
be given or withheld in the sole and absolute discretion of each Bank) pursuant
to this Section the Tranche A Maturity Date may be extended for one-year
periods, provided no Default or Event of Default has occurred and is continuing
at the time of such request. Not earlier than three months prior to, nor later
than 30 days prior to, each anniversary of the Closing Date, Borrower may
request by Requisite Notice made to the Administrative Agent (who shall promptly
notify the Banks) a one year extension of the Tranche A Maturity Date. Such
request shall include a certificate signed by a Responsible Officer stating that
(i) the representations and warranties contained in Section 5 shall be true and
correct on and as of the date of such certificate and (ii) no Default or Event
of Default has occurred and is continuing. Each Bank shall, within 20 Business
days of the Administrative Agent delivering such notice to such Bank, notify in
writing the Administrative Agent whether it consents to or declines such
request, provided that any Bank failing to so notify the Administrative Agent
within such period shall be deemed to decline such request.
(Credit Agreement)
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(ii) The Administrative Agent shall, after receiving the
notifications from all of the Banks having a Tranche A Commitment or the
expiration of such period, whichever is earlier, notify Borrower and the Banks
of the results thereof. If all of the Banks having a Tranche A Commitment have
consented, then the Tranche A Maturity Date shall be extended for one year.
(b) Tranche B Maturity Date. (i) Borrower may, no earlier than 50 days
and not later than 30 days prior to the then effective Tranche B Maturity Date
(as it may be extended from time to time pursuant hereto), and in any event not
earlier than Borrower's delivery to the Banks of the audited financial
statements referred to in Section 6.1(b) for the then most recently ended fiscal
year, request in writing to the Administrative Agent (who shall promptly notify
the Banks) that the Tranche B Maturity Date be extended for an additional 364
days. After Borrower's request, each Bank having a Tranche B Commitment may, in
its sole discretion, consent or not consent to such extension by giving written
notice thereof to the Administrative Agent within 21 days after receipt of
notice of the extension request. Each Bank's annual decision as to whether to
extend the Tranche B Maturity Date shall be based on such information it deems
relevant including in its discretion a new credit analysis utilizing then
current information in respect of the Borrower's business, financial condition
and operations and other information furnished by the Borrower. Failure of any
Bank having a Tranche B Commitment to respond on or before such 21 day period
shall be deemed to be a refusal of such request by such Bank. The Administrative
Agent shall promptly notify each Bank and the Borrower of any Bank's decision to
reject the proposed extension.
(ii) If, in accordance with the provisions of this Section
2.12, a Bank consents to the extension to the Tranche B Maturity Date, the
Tranche B Maturity Date for such Bank shall be extended for 364 days from the
then current Tranche B Maturity Date, without any further action by the Borrower
or such Bank.
(iii) If any Bank having a Tranche B Commitment does not
consent to a request for an extension of the Tranche B Maturity Date, or is
deemed not to have consented to the requested extension, and the Tranche B
Maturity Date has been extended for the other Bank(s) having a Tranche B
Commitment: (i) the Borrower may, prior to the end of the non-extended Tranche B
Maturity Date, terminate such Bank's Tranche B Commitment under this Agreement
upon payment in full of principal and interest on all Tranche B Loans made by
such Bank together with such other sums, if any, that may be due by reason of
such prepayment and any fees owing to such Bank and, in connection with such
termination, the Borrower may replace such non-consenting Bank with a new Bank
or increase the Tranche B Commitment of an existing Bank, in each case pursuant
to Section 2.6 as if the Tranche B Commitment of the non-consenting Bank were a
request for an increase in the Tranche B Commitments in the amount of such
Tranche B Commitments, provided that the time periods for notices set forth in
Section 2.6 may, at the options of the Administrative Agent, be shortened to
such periods as the Administrative Agent deems reasonable; and (ii) if the
Borrower has not previously terminated such non-consenting Bank's Tranche B
Commitment under this Agreement and paid principal and interest on the Tranche B
Loans held by such non-consenting Bank and other amounts due to such
non-consenting Bank as provided above, then such principal and interest and
other amounts due to such non-consenting Bank shall be due and payable on the
non-extended Tranche B
(Credit Agreement)
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Maturity Date and the Tranche B Maturity Date shall not be extended in so far as
such non-consenting Bank is concerned.
SECTION 3
TAXES, YIELD PROTECTION AND ILLEGALITY
3.1 TAXES. Each payment of any amount payable by Borrower under this
Agreement or any other Loan Document shall be made free and clear of, and
without reduction by reason of, any Applicable Taxes. To the extent that
Borrower is obligated by applicable Laws to make any deduction or withholding on
account of Applicable Taxes from any amount payable to any Bank or the Issuing
Bank under this Agreement, Borrower shall promptly notify the Administrative
Agent of such fact and shall (a) make such deduction or withholding and pay the
same to the relevant Governmental Authority and (b) pay such additional amount
directly to that Bank or the Issuing Bank as is necessary to result in that Bank
or the Issuing Bank receiving a net after-Applicable Tax amount equal to the
amount to which that Bank or the Issuing Bank would have been entitled under
this Agreement absent such deduction or withholding. Within 30 days after the
date of any payment by Borrower of any amounts pursuant to this section,
Borrower shall furnish to the Administrative Agent the original or a certified
copy of a receipt evidencing payment thereof, or other evidence of payment
satisfactory to the Administrative Agent.
3.2 INCREASED COSTS. If any Bank or the Issuing Bank determines that
any Laws or guidelines (whether or not having the force of law), or compliance
therewith, have the effect of increasing its cost of agreeing to make or making,
agreeing to issue or participating in, funding or maintaining any Loans or
Letters of Credit, then Borrower shall, upon demand by such Bank or the Issuing
Bank (with a copy of such demand to the Administrative Agent), pay to the
Administrative Agent for the account of such Bank or the Issuing Bank additional
amounts sufficient to compensate such Bank or the Issuing Bank for such
increased cost.
3.3 CAPITAL ADEQUACY. If any Bank or the Issuing Bank determines that
any Laws regarding capital adequacy, or compliance by such Bank or the Issuing
Bank (or its Lending Office) or any corporation controlling the Bank or the
Issuing Bank, with any request, guideline or directive regarding capital
adequacy (whether or not having the force of law) of any Governmental Authority
not imposed as a result of the Issuing Bank's, such Bank's or such corporation's
failure to comply with any other Laws, affects or would affect the amount of
capital required or expected to be maintained by such Bank, the Issuing Bank or
any corporation controlling such Bank or the Issuing Bank and (taking into
consideration such Bank's or such corporation's policies with respect to capital
adequacy and such Bank's and the Issuing Bank's desired return on capital)
determines in good faith that the amount of such capital is increased, or the
rate of return on capital is reduced, as a consequence of its obligations under
this Agreement, then upon demand of such Bank or the Issuing Bank (with a copy
to the Administrative Agent), Borrower shall pay to such Bank or the Issuing
Bank, from time to time as specified in good faith by such Bank or the Issuing
Bank, additional amounts sufficient to compensate such Bank or the Issuing Bank
in light of such circumstances, to the extent reasonably allocable to such
obligations under this Agreement.
3.4 ILLEGALITY. If any Bank determines that any Law has made it
unlawful, or that any Governmental Authority has asserted that it is unlawful,
for any Bank or its applicable Lending
(Credit Agreement)
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Office to make, maintain or fund Offshore Rate Loans, or materially restricts
the authority of such Bank to purchase or sell, or to take deposits of, Dollars
in the London or interbank market, or to determine or charge interest rates
based upon the Offshore Rate, then, on notice thereof by the Bank to Borrower
through the Administrative Agent, any obligation of that Bank to make Offshore
Rate Loans shall be suspended until the Bank notifies the Administrative Agent
and Borrower that the circumstances giving rise to such determination no longer
exist. Upon receipt of such notice, Borrower shall, upon demand from such Bank
(with a copy to the Administrative Agent), prepay or Convert all Offshore Rate
Loans of that Bank, either on the last day of the Interest Period thereof, if
the Bank may lawfully continue to maintain such Offshore Rate Loans to such day,
or immediately, if the Bank may not lawfully continue to maintain such Offshore
Rate Loan. Each Bank agrees to designate a different Lending Office if such
designation will avoid the need for such notice and will not, in the good faith
judgment of such Bank, otherwise be materially disadvantageous to such Bank.
3.5 INABILITY TO DETERMINE RATES. If, in connection with any Request
for Extension of Credit, the Administrative Agent determines that (a) deposits
in the relevant currency are not being offered to Banks in the London interbank
market for the applicable amount and Interest Period of the requested Loan, (b)
adequate and reasonable means do not exist for determining the underlying
interest rate (other than the Base Rate) for the Loans requested therein, or (c)
such underlying interest rates do not adequately and fairly reflect the cost to
the Banks of funding such Loan, the Administrative Agent will promptly so notify
Borrower and each Bank. Thereafter, the obligation of the Banks to make or
maintain Loans based upon such affected interest rate or such currency shall be
suspended until the Administrative Agent revokes such notice. Upon receipt of
such notice, Borrower may revoke any pending Request for Extension of Credit for
such type of Loan or, failing that, be deemed to have converted such Request for
Extension of Credit into a request for Base Rate Loans in the amount specified
therein.
3.6 BREAKFUNDING COSTS. Upon Continuation, Conversion, payment or
prepayment of any Loan other than a Base Rate Loan on a day other than the last
day in the applicable Interest Period (whether voluntary, mandatory, automatic,
by reason of acceleration, or otherwise and including any such action required
under this Section 3), or upon the failure of Borrower (for a reason other than
the failure of a Bank to make a Loan) to borrow, Continue or Convert any Loan
other than a Base Rate Loan on the date or in the amount specified in any
Request for Extension of Credit, then Borrower shall, upon demand made by any
Bank (with a copy to the Administrative Agent), reimburse each Bank and hold
each Bank harmless from any loss or expense which the Bank may sustain or incur
as a consequence thereof, including any such loss or expense arising from the
liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
3.7 MATTERS APPLICABLE TO ALL REQUESTS FOR COMPENSATION.
(a) The Administrative Agent and any Bank shall provide reasonable
detail to Borrower regarding the manner in which the amount of any payment to
the Administrative Agent or that Bank under this Section 3 has been determined,
concurrently with demand for such payment. The Administrative Agent's or any
Bank's determination of any amount payable under this Section 3 shall be
conclusive in the absence of manifest error.
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(b) For purposes of calculating amounts payable under this Section 3
any Loan shall be deemed to have been funded at the applicable interest rate set
forth in the definition thereof whether or not such Loan was, in fact, so
funded.
(c) All of Borrower's obligations under this Section 3 shall survive
termination of the Commitments and payment in full of all Outstanding
Obligations.
SECTION 4
CONDITIONS
4.1 INITIAL EXTENSION OF CREDIT. The obligation of each Bank to make
the initial Loan to be made by it, or the obligation of the Issuing Bank to
issue the initial Letter of Credit (as applicable), is subject to the following
conditions precedent, each of which shall be satisfied prior to the making of
the initial Loans or the issuance of the initial Letter of Credit (unless all of
the Banks, in their sole and absolute discretion, shall agree otherwise):
(a) The Administrative Agent shall have received all of the following,
each of which shall be originals unless otherwise specified, each properly
executed by a Responsible Officer, each dated as of the Closing Date and each in
form and substance satisfactory to the Administrative Agent and its legal
counsel (unless otherwise specified or, in the case of the date of any of the
following, unless the Administrative Agent otherwise agrees or directs):
(1) at least one executed counterpart of this Agreement, together
with arrangements satisfactory to the Administrative Agent for
additional executed counterparts, sufficient in number for distribution
to the Banks and Borrower;
(2) Notes executed by Borrower in favor of each Bank requesting a
Note, each in a principal amount equal to that Bank's Tranche A Pro
Rata Share and Tranche B Pro Rata Share, as applicable;
(3) the Material Subsidiary Guaranty executed by each Material
Subsidiary;
(4) with respect to Borrower and each Material Subsidiary, such
documentation as the Administrative Agent may require to establish the
due organization, valid existence and good standing of Borrower and
each such Material Subsidiary, its qualification to engage in business
in each material jurisdiction in which it is engaged in business or
required to be so qualified, its authority to execute, deliver and
perform any Loan Documents to which it is a party, the identity,
authority and capacity of each Responsible Officer thereof authorized
to act on its behalf, including certified copies of articles of
incorporation and amendments thereto, bylaws and amendments thereto,
certificates of good standing and/or qualification to engage in
business, tax clearance certificates, certificates of corporate
resolutions, incumbency certificates, certificates of Responsible
Officers, and the like;
(5) the Opinion of Counsel;
(6) the Opinion of O'Melveny & Xxxxx LLP, special counsel to the
Administrative Agent, substantially in the form of Exhibit J;
(Credit Agreement)
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(7) a certificate signed by a Responsible Officer setting forth the
Leverage Ratio as of the last day of the most recently ended Fiscal
Quarter;
(8) a certificate signed by a Responsible Officer certifying that
the conditions specified in Sections 4.1(d) and 4.1(e) have been
satisfied; and
(9) such other assurances, certificates, documents, consents or
opinions as the Administrative Agent reasonably may require.
(b) The fees payable on the Closing Date shall have been paid.
(c) Attorney Costs of Bank of America to the extent invoiced prior to
or on the Closing Date, plus such additional amounts of Attorney Costs as shall
constitute Bank of America's reasonable estimate of Attorney Costs incurred or
to be incurred by it through the closing proceedings (provided that such
estimate shall not thereafter preclude final settling of accounts between
Borrower and Bank of America).
(d) The representations and warranties of Borrower contained in Section
5 shall be true and correct.
(e) Borrower and each Material Subsidiary shall be in compliance with
all the terms and provisions of the Loan Documents, and giving effect to the
initial Loan (or initial Letter of Credit, as applicable) no Default or Event of
Default shall have occurred and be continuing.
(f) Since June 30, 1999, no Material Adverse Effect shall have
occurred.
(g) Borrower and its Subsidiaries shall have completed and delivered to
the Administrative Agent the assessment review regarding Borrower's programs for
dealing with the Year 2000 Problem (as defined in Section 5.14), and the
Administrative Agent and Requisite Banks shall have been satisfied as to the
Borrower's responses therein.
4.2 ANY EXTENSION OF CREDIT. The obligation of each Bank to make any
Extension of Credit is subject to the following conditions precedent:
(a) the representations and warranties of Borrower contained in Section
5 are true and correct in all material respects as though made on and as of the
above date (except to the extent that such representations and warranties
expressly relate solely to an earlier date and then shall be correct as of such
date), before and after giving effect to such Borrowing and to the application
of the proceeds therefrom, as though made on and as of such date;
(b) no Default or Event of Default has occurred and is continuing, or
would result from such proposed Extension of Credit.
(c) the Administrative Agent shall have timely received a duly
completed Request for Extension of Credit or Letter of Credit Application, as
applicable, by Requisite Notice by the Requisite Time therefor;
(Credit Agreement)
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(d) on the date of the first Extension of Credit hereunder, evidence
that the Existing Credit Agreements have been, or concurrently therewith are
being, terminated and that all amounts owing thereunder have been, or
concurrently therewith are being, paid in full; provided, however, that letters
of credit issued thereunder set forth on Schedule 7.1 may remain outstanding so
long as the commitments and covenants (except for those covenants and agreements
relating to such outstanding letters of credit and reimbursement of drawings
thereunder) under the Existing Credit Agreements are otherwise terminated; and
(e) the Administrative Agent shall have received, in form and substance
satisfactory to the Administrative Agent, such other assurances, certificates,
documents or consents related to the foregoing as the Administrative Agent or
Requisite Banks reasonably may require.
SECTION 5
REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to the Administrative Agent and the
Banks that:
5.1 DUE INCORPORATION, ETC. Each of Borrower and the Material
Subsidiaries are corporations duly organized, validly existing and in good
standing under the laws of the jurisdiction of their organization and have all
requisite corporate power and authority to own or lease and operate their
respective properties and to carry on their businesses as now conducted, and to
execute and deliver, and to perform all of their obligations under, any Loan
Document to which they are a party, and the transactions and documents
contemplated hereby to which they are a party. Each of Borrower and its
Subsidiaries are duly qualified or licensed to do business as foreign
corporations in good standing in all jurisdictions in which they own or lease
assets and property or in which the conduct of their businesses requires them to
so qualify or be licensed, except where the failure to so qualify or be licensed
would not have a Material Adverse Effect. Each Subsidiary of Borrower on the
date hereof is set forth on Schedule 5.1.
5.2 AUTHORIZATION OF BORROWING, ETC.
(a) Authorization of Borrowing, No Conflict. The execution, delivery
and performance by Borrower and each Material Subsidiary of Borrower that is a
party to a Loan Document of the Loan Documents, the payment and performance of
all Obligations, and the issuance, delivery and payment of the Letters of Credit
and the consummation of the transactions contemplated hereby are within each
such entity's corporate powers, have been duly authorized by all necessary
corporate action by Borrower and each Material Subsidiary of Borrower which is a
party to a Loan Document, do not contravene (i) Borrower's and such Material
Subsidiary's certificate of incorporation or by-laws, or (ii) any law, rule,
regulation (including, without limitation, Regulation U or X of the Board of
Governors of the Federal Reserve System), order, writ, judgment, injunction,
decree, determination or award or any contractual restriction binding on or
affecting Borrower or such Material Subsidiary or any of its properties, and do
not result in or require the creation of any lien, security interest or other
charge or encumbrance upon or with respect to any of its properties; neither
Borrower nor any of its Subsidiaries is in default under any such law, rule,
regulation, order, writ, judgment, injunction, decree, determination, award or
restriction, in any respect which is likely to have a Material Adverse Effect.
(Credit Agreement)
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(b) Governmental Consents. No authorization, consent, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is currently or is reasonably expected to be required on the
part of Borrower or any Material Subsidiary of Borrower that is a party to a
Loan Document for the due execution, delivery or performance by Borrower or any
of its Material Subsidiaries of any Loan Document, the payment and performance
of the Obligations by Borrower or any of its Subsidiaries, and the issuance,
delivery and payment of the Letters of Credit and the consummation of the
transactions contemplated hereby, except such authorizations, consents,
approvals, other actions, notices or filings which, if not obtained, either (i)
would not adversely affect the ability of Borrower and each of its Subsidiaries
that is a party to a Loan Document to perform the transactions contemplated by
the Loan Documents, or (ii) would not have a Material Adverse Effect.
(c) Due Execution and Delivery; Binding Obligations. This Agreement and
each other Loan Document, if any, have been, or will be, duly executed and
delivered by Borrower and each of its Material Subsidiaries which is a party
thereto. This Agreement and each other Loan Document, if any, and the
Obligations are, or will be, legally valid and binding obligations of Borrower
and each of its Material Subsidiaries which is a party thereto, enforceable
against Borrower or such Material Subsidiary in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws or equitable principles relating to or limiting
creditors' rights generally or by equitable principles relating to
enforceability.
5.3 FINANCIAL CONDITION. The unaudited consolidated balance sheet of
Borrower and its Subsidiaries dated June 30, 1999 and the related consolidated
statements of income and cash flows, copies of which have been furnished to each
Bank, were prepared in conformity with GAAP. All financial statements delivered
to Banks pursuant to Section 6.1 hereof after the Closing Date will fairly
present the consolidated financial position of Borrower and its Subsidiaries as
at the respective dates thereof and the consolidated results of operations and
cash flows of Borrower and its Subsidiaries for each of the periods covered
thereby, subject, in the case of any unaudited interim financial statements, to
changes resulting from normal year-end adjustments. Since June 30, 1999, there
has been no material adverse change in the business, condition (financial or
otherwise), operations or properties of Borrower or Borrower and its
Subsidiaries taken as a whole.
5.4 ABSENCE OF LITIGATION; LITIGATION DESCRIPTION. No actions, suits,
investigations, litigation or proceedings are pending or, to the knowledge of
Borrower, threatened against or affecting Borrower or any of its Subsidiaries or
the properties of Borrower or any such Subsidiary before any court, arbitrator
or governmental agency, department, commission, board, bureau or
instrumentality, domestic or foreign, (a) that would have a Material Adverse
Effect, or (b) which purports to affect the legality, validity or enforceability
of this Agreement and any other Loan Document.
5.5 PAYMENT OF TAXES. Borrower and each of its Subsidiaries have filed
or caused to be filed all tax returns (Federal, state, local and foreign)
required to be filed and paid all amounts of taxes shown thereon to be due,
including interest and penalties, except for (a) such taxes as are being
contested in good faith and by proper proceedings and with respect to which
appropriate
(Credit Agreement)
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reserves are being maintained by Borrower or any such Subsidiary, as the case
may be or (b) those the failure to pay which would not have a Material Adverse
Effect.
5.6 GOVERNMENTAL REGULATION. Borrower is not subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act or the Investment Company Act of 1940, each as amended,
or to any Federal or state statute or regulation limiting its ability to incur
indebtedness for money borrowed. No Subsidiary is subject to any regulation that
would limit the ability of Borrower to enter into or perform its obligations
under this Agreement.
5.7 NOT A PURPOSE CREDIT. Borrower and its Subsidiaries are not engaged
in the business of extending credit for the purpose of purchasing or carrying
margin stock (within the meaning of Regulation U or X issued by the Board of
Governors of the Federal Reserve System), and no proceeds of any Loan or Letter
of Credit, will be used to purchase or carry any margin stock or to extend
credit to others for the purpose of purchasing or carrying any margin stock.
5.8 ERISA.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other federal or state law. Each
Plan which is intended to qualify under Section 401(a) of the Code has received
a favorable determination letter from the IRS or an application for such a
letter is currently being processed by the IRS with respect thereto and, to the
best knowledge of Borrower, nothing has occurred which would prevent, or cause
the loss of, such qualification. Borrower and each ERISA Affiliate has made all
required contributions to any Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Borrower,
threatened claims, actions or lawsuits, or action by any Governmental Authority,
with respect to any Plan which has resulted or could reasonably be expected to
result in a Material Adverse Effect. There has been no prohibited transaction or
violation of the fiduciary responsibility rules with respect to any Plan which
has resulted or could reasonably be expected to result in a Material Adverse
Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Plan has any Unfunded Pension Liability; (iii) neither Borrower nor any
ERISA Affiliate has incurred, or reasonably expects to incur, any liability
under Title IV of ERISA with respect to any Plan (other than premiums due and
not delinquent under Section 4007 of ERISA); (iv) neither Borrower nor any ERISA
Affiliate has incurred, or reasonably expects to incur, any liability (and no
event has occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Section 4201 or 4243 of ERISA with respect
to a Multiemployer Plan; and (v) neither Borrower nor any ERISA Affiliate has
engaged in a transaction that could be subject to Section 4069 or 4212(c) of
ERISA.
5.9 DISCLOSURE. No representation or warranty of Borrower or any
Subsidiary of Borrower contained in any Loan Document (including any Schedule
furnished in connection herewith) or any other document, certificate or written
statement furnished to the Administrative
(Credit Agreement)
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Agent or any Bank by or on behalf of Borrower for use in connection with the
transactions contemplated by this Agreement contains any untrue statement of a
material fact or omits to state a material fact (known to Borrower in the case
of any documents not furnished by it) necessary in order to make the statements
contained herein or therein not misleading in light of the circumstances under
which the same were made. The projections and pro forma financial information
contained in such materials are based upon good faith estimates and assumptions
believed by the Persons responsible for preparing such projections and pro forma
financial information to be reasonable at the time made, it being recognized by
the Banks that such projections as to future events are not to be viewed as
facts and that actual results during the period or periods covered by any such
projections may differ from the projected results. There are no facts known to
Borrower (other than matters of a general economic nature) that have had or
could reasonably be expected to have a Material Adverse Effect that have not
been disclosed herein or in the other documents, certificates and written
statements referred to in this Section 5.9.
5.10 INSURANCE. Borrower and its Subsidiaries have in full force
insurance coverage of their respective properties, assets and business
(including casualty, general liability, products liability and business
interruption insurance) that is (a) no less protective in any material respect
than the insurance Borrower and its Subsidiaries have carried in accordance with
their past practices or (b) prudent given the nature of the business of Borrower
and its Subsidiaries and the prevailing practice among companies similarly
situated.
5.11 ENVIRONMENTAL MATTERS. (a) Borrower and each of its Subsidiaries
is in compliance in all material respects with all Environmental Laws the
non-compliance with which can reasonably be expected to have a Material Adverse
Effect and (b) there has been no "release or threatened release of a hazardous
substance" (as defined by the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, as amended, 42 U.S.C. Section 9601 et seq.) or any
other release, emission or discharge into the environment of any hazardous or
toxic substance, pollutant or other materials from Borrower's or its
Subsidiaries' property other than as permitted under applicable Environmental
Law and other than those which would not have a Material Adverse Effect. Other
than disposals for which Borrower has been indemnified in full or disposals
prior to the Closing Date which would not have a Material Adverse Effect, all
"hazardous waste" (as defined by the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901 et seq. (1976) and the regulations thereunder, 40 CFR Part
261 ("RCRA")) generated at Borrower's or any Subsidiaries' properties and
removed for disposal have in the past been and shall continue to be disposed of
at sites which maintain valid permits under RCRA and any applicable state or
local Environmental Law.
5.12 PERFORMANCE OF AGREEMENTS. Neither Borrower nor any of its
Subsidiaries is in default in the performance, observance or fulfillment of any
of the obligations, covenants, or conditions contained in any contractual
obligation of Borrower or of such Subsidiary, except where the consequences,
direct or indirect, of such default or defaults, if any, has not had and could
not reasonably be expected to have a Material Adverse Effect and no condition
exists that, with the giving of due notice or the lapse of time or both, would
constitute such a default, except where the consequences, direct or indirect, of
such default, if any, has not had and could not reasonably be expected to have a
Material Adverse Effect.
(Credit Agreement)
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5.13 SOLVENCY. After giving effect to the transactions contemplated by
the Loan Documents and the payment of all fees related thereto and hereto, as of
the Closing Date Borrower and its Subsidiaries on a consolidated basis are
Solvent and each of the Material Subsidiaries is Solvent.
5.14 YEAR 2000. Borrower has (a) conducted a review and assessment of
all areas within its and each of its Subsidiaries' business and operations
(including those affected by customers and vendors) that could be adversely
affected by the "Year 2000 Problem" (that is, the risk that computer
applications and devices containing imbedded computer chips used by Borrower or
any of its Subsidiaries (or their respective customers and vendors) may be
unable to recognize and perform properly date-sensitive functions involving
certain dates prior to and any date after December 31, 1999), (b) developed a
plan and timeline for addressing the Year 2000 Problem on a timely basis, and
(c) to date, implemented that plan in accordance with that timetable. Based on
the foregoing, Borrower believes that all computer applications and devices
containing imbedded computer chips (including those of its and its Subsidiaries'
customers and vendors) that are material to its or any of its Subsidiaries'
business and operations are reasonably expected on a timely basis to be able to
perform properly date-sensitive functions for all dates before and after
December 31, 1999 (that is, be "Year 2000 Compliant"), except to the extent that
a failure to do so could not reasonably be expected to have a Material Adverse
Effect.
SECTION 6
AFFIRMATIVE COVENANTS
So long as any Loan remains unpaid, or any other Obligation remains
unpaid or unperformed, or any portion of the Commitments remains in force,
Borrower shall, and shall cause each of its Subsidiaries to:
6.1 REPORTING REQUIREMENTS. Deliver to the Administrative Agent in form
and detail satisfactory to the Administrative Agent and the Requisite Banks,
with sufficient copies for each Bank:
(a) as soon as available and in any event within 50 days after the end
of each of the first three Fiscal Quarters of each Fiscal Year of Borrower, the
consolidated balance sheet of Borrower and its Subsidiaries as of the end of
such Fiscal Quarter and the consolidated statements of income and cash flows of
Borrower and its Subsidiaries for the period commencing at the end of the
previous Fiscal Year and ending with the end of such Fiscal Quarter, certified
by the chief accounting officer of Borrower as fairly presenting the financial
condition of Borrower and its Subsidiaries as at the dates indicated and the
results of their operations for the periods indicated, subject to changes
resulting from audit and normal year-end adjustment;
(b) as soon as available and in any event within 100 days after the end
of each Fiscal Year of Borrower, a copy of the annual audit report for such
Fiscal Year for Borrower and its Subsidiaries, containing financial statements
(including a consolidated balance sheet, consolidated statements of income and
shareholders' equity and cash flows of Borrower and its Subsidiaries) for such
year certified by Ernst & Young LLP or another "Big Five" accounting firm. The
certification shall be unqualified (as to going concern, scope of audit and
disagreements over the accounting or other treatment of offsets) and shall state
that such
(Credit Agreement)
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consolidated financial statements present fairly the financial position of
Borrower and its Subsidiaries as at the dates indicated and the results of their
operations and cash flow for the periods indicated in conformity with GAAP
applied on a basis consistent with prior years (except as otherwise stated
therein) and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with generally
accepted auditing standards; and
(c) together with each delivery of the reports of Borrower and its
Subsidiaries pursuant to subsections (a) and (b) above, a Compliance Certificate
for the Fiscal Quarter or Fiscal Year, as applicable, executed by the chief
accounting officer of Borrower.
6.2 CERTIFICATES, NOTICES AND OTHER INFORMATION. Deliver to the
Administrative Agent in form and detail satisfactory to the Administrative Agent
and the Requisite Banks, with sufficient copies for each Bank:
(a) as soon as possible and in any event within five days after any
Responsible Officer of Borrower becoming aware of the occurrence of any Change
of Control and of each Event of Default and of each Default continuing on the
date of such statement, a statement of the chief accounting officer of Borrower
setting forth details of such Event of Default or event and the action which
Borrower has taken and proposes to take with respect thereto;
(b) promptly after any significant change in accounting policies or
reporting practices, notice and a description in reasonable detail of such
change;
(c) promptly and in any event within 30 days after Borrower or any
ERISA Affiliate becomes aware that any ERISA Event referred to in clause (i) of
the definition of ERISA Event with respect to any Pension Plan has occurred
which might result in liability to the PBGC a statement of the chief accounting
officer of Borrower describing such ERISA Event and the action, if any, that
Borrower or such ERISA Affiliate has taken or proposes to take with respect
thereto;
(d) promptly and in any event within 10 days after Borrower or any
ERISA Affiliate becomes aware that any ERISA Event (other than an ERISA Event
referred to in (c) above) with respect to any Pension Plan has occurred which
might result in liability to the PBGC, a statement of the chief accounting
officer of Borrower describing such ERISA Event and the action, if any, that
Borrower or such ERISA Affiliate has taken or proposes to take with respect
thereto;
(e) promptly and in any event within five Business Days after receipt
thereof by Borrower or any ERISA Affiliate from the PBGC, copies of each notice
from the PBGC of its intention to terminate any Pension Plan or to have a
trustee appointed to administer any Pension Plan;
(f) promptly and in any event within seven Business Days after receipt
thereof by Borrower or any ERISA Affiliate from the sponsor of a Multiemployer
Plan, a copy of each notice received by Borrower or any ERISA Affiliate
concerning (w) the imposition of Withdrawal Liability by a Multiemployer Plan,
(x) the determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA, (y) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA or (z) the amount
(Credit Agreement)
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of liability incurred, or expected to be incurred, by Borrower or any ERISA
Affiliate in connection with any event described in clause (w), (x) or (y)
above;
(g) promptly after the commencement thereof, notice of all material
actions, suits and proceedings before any court or governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign,
affecting Borrower or any of its Subsidiaries, of the type described in Section
5.4;
(h) promptly after the sending or filing thereof, copies of all proxy
statements, financial statements and reports that Borrower or any of its
Subsidiaries sends to its stockholders generally, and copies of all regular,
periodic and special reports, and all registration statements, that Borrower or
any of its Subsidiaries files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or with any national
securities exchange;
(i) promptly after the furnishing thereof, copies of any material
correspondence, statement or report furnished to any other holder of the
securities of Borrower or any of its Subsidiaries pursuant to the terms of any
indenture, loan or credit or similar agreement and not otherwise required to be
furnished to the Banks pursuant to any other clause of this Section 6.2;
(j) promptly after the occurrence thereof, notice of the receipt by
Borrower or any of its Subsidiaries of any notice, order, directive or other
communication from a governmental authority alleging violations of or
noncompliance with any Environmental Law which could reasonably be expected to
have a Material Adverse Effect; and
(k) such other information respecting the condition or operations,
financial or otherwise, of Borrower or any of its Subsidiaries as any Bank
through the Administrative Agent may from time to time reasonably request.
6.3 MATERIAL SUBSIDIARY GUARANTY. Borrower will cause each of its
Material Subsidiaries (and such other domestic Subsidiaries as may be necessary
in order to comply with Section 7.14 hereof) promptly to execute and deliver an
instrument of joinder to the Material Subsidiary Guaranty, together with such
other documents and agreements including, without limitation, legal opinions and
resolutions as the Administrative Agent or the Requisite Banks may reasonably
request.
6.4 CORPORATE EXISTENCE, ETC. Borrower will, and will cause each of its
Subsidiaries to, at all times maintain its fundamental business and preserve and
keep in full force and effect its corporate existence (except as permitted under
Section 7.6) and all rights, franchises and licenses necessary or desirable in
the normal conduct of its business; provided, however, that Borrower shall not
be required to maintain any such rights, franchises or licenses or the corporate
existence of any Subsidiary (other than any Material Subsidiary) if the failure
to do so could not reasonably be expected to have a Material Adverse Effect.
6.5 ACCESS AND VISITATION RIGHTS. Borrower will and will cause each of
its Subsidiaries to, upon reasonable notice and at any reasonable time during
normal business hours and from time to time, permit the Administrative Agent or
any of the Banks or any agents or representatives thereof to examine and make
copies of and abstracts from the records and books
(Credit Agreement)
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of account of, and visit the properties of, Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of Borrower and
any of its Subsidiaries with any of their officers or directors and independent
public accountants (and by this provision Borrower authorizes said accountants
to discuss with the Banks the finances and affairs of Borrower and its
Subsidiaries), provided that Borrower shall have the right to have a
representative of Borrower present at any such discussion with such officers,
directors and independent public accountants.
6.6 PAYMENT OF TAXES, ETC. Borrower will and will cause each of its
Subsidiaries to pay and discharge, before the same shall become delinquent, (a)
all taxes, assessments and governmental charges or levies imposed upon it or
upon its property and (b) all lawful claims that, if unpaid, might by law become
a lien upon their property, provided, however, that neither Borrower nor any
such Subsidiary shall be required to pay or discharge any such tax, assessment,
charge or claim (i) that is being contested in good faith and by proper
proceedings and for which appropriate reserves are being maintained, or (ii) the
failure to pay or discharge which would not have a Material Adverse Effect.
6.7 MAINTENANCE OF PROPERTIES, ETC. Borrower will and will cause each
of its Subsidiaries to maintain and preserve, all of its properties with respect
to which failure to so maintain and preserve would have a Material Adverse
Effect.
6.8 COMPLIANCE WITH LAWS, ETC. Borrower will, and will cause each of
its Subsidiaries to, perform and promptly comply with the requirements of all
applicable laws, rules, regulations and orders of any governmental authority
(including, without limitation, all Environmental Laws and ERISA) other than
those with which the failure to comply would not have a Material Adverse Effect.
6.9 MAINTENANCE OF INSURANCE. Borrower will maintain, and will maintain
for each of its Subsidiaries, insurance with responsible and reputable insurance
companies or associations in such amounts and covering such risks (a) as are
usually insured by companies engaged in similar businesses and owning similar
properties in the same general areas in which Borrower or such Subsidiary
operates, (b) with responsible and reputable insurance companies or associations
reasonably satisfactory to Banks and (c) subject to market availability and
reasonable price, in amounts and coverages (including deductibles) consistent
with industry practice.
6.10 EMPLOYMENT OF TECHNOLOGY, DISPOSAL OF HAZARDOUS WASTE, ETC.
Borrower will and will cause each of its Subsidiaries to (a) employ in
connection with its use of its property appropriate technology (including,
without limitation, appropriate secondary containment) to maintain compliance
with any applicable Environmental Law, (b) take all actions identified as
necessary to comply with Environmental Law, (c) dispose of any and all
"hazardous waste" generated at any of its properties only at facilities and with
carriers maintaining valid permits under RCRA and any applicable state and local
Environmental Law, and (d) use best efforts to obtain certificates of disposal
from all contractors employed by Borrower in connection with the transport or
disposal of any "hazardous waste" generated at any of its properties except,
with respect to each of the foregoing clauses (a) through (d) where the failure
to perform or comply with any of the foregoing would not have a Material Adverse
Effect.
(Credit Agreement)
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6.11 KEEPING OF BOOKS, ETC. Borrower will, and will cause each of its
Subsidiaries to, keep proper books of record and accounts, in which full and
correct entries shall be made of all financial transactions and the assets and
business of Borrower and each of its Subsidiaries in accordance with GAAP
consistently applied and consistent with prudent business practices.
6.12 FURTHER ASSURANCES. Borrower will and will cause each of its
Subsidiaries to promptly, upon request by the Administrative Agent or any Bank
through the Administrative Agent, correct, any defect or error that may be
discovered in any Loan Document or in the execution, acknowledgment or
recordation thereof. Promptly upon request by the Administrative Agent or any
Bank through the Administrative Agent, Borrower also will, and will cause each
Subsidiary to, do, execute, acknowledge, deliver, record, and will cause any
such Subsidiary to promptly do, execute, acknowledge, deliver, record, re-record
any and all such further acts, termination statements, certificates, assurances
and other instruments as the Administrative Agent or any Bank through the
Administrative Agent may reasonably require from time to time in order (a) to
carry out more effectively the purposes of this Agreement or any other Loan
Document, and (b) to better assure, convey, grant, assign, transfer, preserve,
protect and confirm unto the Administrative Agent and the Banks the rights
granted or now or hereafter intended to be granted to the Administrative Agent
and/or the Banks under any Loan Document or under any other instrument executed
in connection with any Loan Document to which Borrower is or may become a party.
6.13 USE OF PROCEEDS. Borrower shall use the proceeds of Loans for
capital expenditures and for working capital and other general purposes,
including Non-Hostile Acquisitions permitted by Section 7.4(c).
6.14 YEAR 2000 COMPLIANCE. Borrower will, and will cause its
Subsidiaries to, perform all acts reasonably necessary to insure that they are
Year 2000 Compliant (as defined in Section 5.14), except to the extent that a
failure to do so could not reasonably be expected to have a Material Adverse
Effect.
SECTION 7
NEGATIVE COVENANTS
So long as any Loan remains unpaid, or any other Obligation remains
unpaid or unperformed, or any portion of the Commitments remains in force,
Borrower shall not, and shall not permit any of its Subsidiaries to, directly or
indirectly:
7.1 DEBT. Borrower will not, and will not permit any of its
Subsidiaries to, directly or indirectly, create, incur, assume, or otherwise
become or remain directly or indirectly liable with respect to, any Debt,
except:
(a) Debt incurred pursuant to this Agreement;
(b) any Material Subsidiary Guaranty;
(c) Debt in respect of Capital Lease Obligations;
(d) Contingent Obligations permitted by Section 7.5;
(Credit Agreement)
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(e) Borrower and its Subsidiaries may remain liable with respect to any
Debt of Borrower and its Subsidiaries existing on the Closing Date (all of which
Debt that consists of letters of credit and surety and performance bonds
outstanding on the Closing Date and all other of such Debt that is in excess of
$1,000,000 in outstanding principal amount is described in Schedule 7.1) and
refinancing thereof; provided that such refinanced Debt shall be on terms no
less favorable to Borrower (other than in respect to market interest rate
changes) and its Subsidiaries than the Debt being replaced and after giving
effect thereto would not result in a Default or Event of Default;
(f) Borrower and its Subsidiaries may become and remain liable with
respect to intercompany Debt; provided that all of the intercompany Debt of
Borrower to any Subsidiary of Borrower shall be subordinated to the Obligations
in accordance with the terms set forth in Exhibit H;
(g) Debt of any Person which becomes a Subsidiary of Borrower or is
merged into Borrower or any Subsidiary of Borrower in an amount permitted under
Section 7.4(c); and provided such Debt existed at the time such Person became a
Subsidiary of Borrower or was so merged and was not created in contemplation of
such event and before and immediately after giving effect to such event no Event
of Default shall exist and Borrower shall be in compliance with Section 7.7);
provided further that any Debt of a Person that is merged into Borrower, is only
permitted to the extent it is unsecured unless after giving effect to such
merger Borrower is in compliance with Section 7.2;
(h) without duplication of subsections (c), (e) and (g) of this Section
7.1, Borrower and its Subsidiaries may become and remain liable with respect to
purchase money Debt in an aggregate principal amount outstanding at any time not
in excess of 15% of Consolidated Net Worth of Borrower and its Subsidiaries (as
shown on the most recent financial statements delivered pursuant to Section
6.1(a) or (b)); provided that such Debt is secured only by the property
purchased with such Debt; provided further that the loan-to-value ratio of such
Debt does not exceed 100% with respect to personal property and 80% with respect
to real property, in each case, at the time of incurrence of any such Debt;
(i) the Subsidiaries of Borrower may become and remain liable with
respect to Debt if such Debt is permitted by the last proviso of this Section
7.1;
(j) Borrower and its Subsidiaries may become and remain liable in
respect of industrial revenue bonds issued on behalf of Borrower or its
Subsidiaries;
(k) Debt in connection with the Receivables Program permitted by
Section 7.13; and
(l) without duplication of any of the foregoing clauses, Borrower may
create, incur, assume or suffer to exist Debt; provided that such Debt is not
secured by any assets of Borrower or any of its Subsidiaries other than as
permitted by Section 7.2;
provided that, notwithstanding subsections (a) through (l) of this Section 7.1,
the Subsidiaries of Borrower may not create, incur, assume or suffer to exist
any Subsidiary Debt in an aggregate principal amount outstanding at any time
exceeding 15% of Consolidated Net Worth of Borrower and its Subsidiaries (as
shown on the most recent financial statements delivered
(Credit Agreement)
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pursuant to Section 6.1(a) or (b)); provided further that, transactions of the
type permitted by Section 7.13 shall not count against any of the quantitative
baskets set forth in this Section 7.1.
7.2 LIENS AND RELATED MATTERS. Borrower will not, and will not permit
any of its Subsidiaries to, directly or indirectly, create, incur, assume or
permit to exist any Lien, or file or execute or agree to the execution of any
financing statement, on or with respect to, the assets of Borrower or any
Subsidiary (including any document or instrument in respect of goods or accounts
receivable), whether now owned or hereafter acquired, or any income or profits
therefrom, except:
(a) Liens for taxes, assessments or other governmental charges or
levies not yet due and payable, and not required to be paid by Borrower or any
of its Subsidiaries under Section 6.6;
(b) statutory Liens of landlords and Liens of carriers, warehousemen,
mechanics, workmen, employees, materialmen and other Liens imposed by law and
not required to be paid by Borrower or any of its Subsidiaries under Section
6.6;
(c) Liens (other than any Lien imposed by ERISA) incurred or deposits
made in the ordinary course of business in connection with workers'
compensation, unemployment insurance and other types of social security, or to
secure the performance of tenders, statutory obligations, surety and appeal
bonds, bids, leases, government contracts, performance and return-of-money bonds
and other similar obligations (exclusive of obligations for the payment of
borrowed money);
(d) minor Liens on the property or assets of Borrower or any of its
Subsidiaries which do not in the aggregate materially detract from the value of
such property or assets or materially impair their use in the operation of the
business of Borrower or such Subsidiary, as the case may be;
(e) the rights of set-off and banker's liens granted or confirmed to
the Banks under this Agreement or any other Loan Document and rights of set-off
and banker's liens granted or confirmed to the holders of other Debt permitted
under this Agreement or any other Loan Document;
(f) any Liens in existence on property of any Person at the time such
Person becomes a Subsidiary of Borrower or is merged into any Subsidiary of
Borrower and not created in contemplation of such event;
(g) attachment, judgment and other similar Liens arising in connection
with legal proceedings, provided that the execution or other enforcement of such
Liens is effectively stayed and the claims secured thereby are being contested
in good faith by appropriate proceedings; and provided that any such judgment
does not constitute an Event of Default;
(h) Liens created by (i) any Subsidiary of Borrower in favor of
Borrower or (ii) any Subsidiary of Borrower in favor of another Subsidiary of
Borrower, securing obligations of such Subsidiary owing to Borrower or another
Subsidiary of Borrower (which Liens by their terms may not be transferred except
to Borrower or another Subsidiary of Borrower);
(Credit Agreement)
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(i) Liens created hereunder or under any other Loan Document;
(j) Easements, rights-of-way, zoning and similar restrictions and other
similar charges or encumbrances now or hereafter existing not interfering with
the ordinary conduct of business of Borrower or any of its Subsidiaries;
(k) Liens and security interests securing purchase money Debt permitted
under Section 7.1(h) and Liens and security interests which are Capital Lease
Obligations; provided, however, that no Lien or security interest referred to in
this subsection (k) shall extend to or cover any property other than the related
property being acquired or leased (as the case may be);
(l) Liens on real or personal property required in connection with the
issuance of industrial revenue bonds on behalf of Borrower or its Subsidiaries;
(m) Liens existing on the Closing Date securing Debt listed on Schedule
7.1 and any refinancings thereof permitted pursuant to Section 7.1(e);
(n) Liens created or incurred in connection with the Receivables
Program permitted by Section 7.13; and
(o) without duplication of any of the foregoing clauses, other Liens
securing obligations of Borrower or its Subsidiaries in an aggregate outstanding
principal amount not exceeding $10,000,000 at any time.
7.3 NEGATIVE PLEDGES; RESTRICTIONS ON DIVIDENDS, ETC. Borrower will
not, and will not permit any of its Subsidiaries to, directly or indirectly:
(a) enter into or remain a party to any agreement prohibiting the
creation, incurrence or assumption of any Lien on or with respect to any assets
of Borrower, or any Subsidiary, whether now owned or hereafter acquired, or any
income or profits therefrom, except for such prohibitions contained in (A) this
Agreement and (B) instruments governing any Debt permitted under Section 7.1.
(b) Create or permit to exist or become effective any restriction of
any kind on the ability of any Subsidiary to (i) pay dividends or make any other
distribution on or with respect to any of its stock or other ownership interests
owned by Borrower or any Subsidiary of Borrower, (ii) pay any Debt owed to
Borrower or any Subsidiary of Borrower, (iii) make loans or advances to Borrower
or any other Subsidiary of Borrower, or (iv) transfer any of its assets to
Borrower or any Subsidiary of Borrower, except for such prohibitions contained
in this Agreement and for such prohibitions contained in the Senior Debt
Documents and in documents relating to the Receivables Program.
7.4 INVESTMENTS AND ACQUISITIONS. Borrower will not, and will not
permit any of its Subsidiaries to, directly or indirectly, make or own any
Investment in any Person or make, or commit to make any acquisition (whether by
purchase of capital stock or assets, merger or otherwise), except:
(a) Cash Equivalents;
(Credit Agreement)
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(b) Investments that constitute intercompany Debt and are otherwise
permitted by Section 7.1; provided that all of the Debt of Borrower to any
Subsidiary of Borrower shall be expressly subordinated to the Obligations in
accordance with the terms set forth in Exhibit H;
(c) Non-Hostile Acquisitions by Borrower or any of its Subsidiaries of
assets constituting a business unit or the capital stock of any Person provided
that (i) Borrower is the surviving entity following such acquisition of assets
or capital stock, (ii) Borrower continues in the same type of business currently
conducted without material changes in the nature of its business and (iii)
Borrower is capable of incurring additional Debt in connection with such
acquisition of assets or capital stock without violating any debt or covenant
restrictions and without creating an Event of Default;
(d) Borrower and its Subsidiaries may make and maintain Investments in
Subsidiaries;
(e) Investments in Joint Ventures existing on the Closing Date and set
forth on Schedule 7.4, and after the Closing Date Investments in Joint Ventures
not listed on Schedule 7.4 ("Additional Joint Ventures"); provided that (i) any
such Joint Venture is in and continues in the same type of business as is
conducted by Borrower on the Closing Date, (ii) none of Borrower or any Material
Subsidiary is a general partner (or would be liable to the extent of a general
partner) of any such Joint Venture, and (iii) at the time of any Investment in
an Additional Joint Venture the aggregate Investments made by Borrower and its
Subsidiaries in Additional Joint Ventures (after giving effect to the Investment
to be made) shall not exceed 15% of the Consolidated Net Worth of Borrower and
its Subsidiaries as shown on the most recent financial statements delivered
pursuant to Section 6.1(a) or (b);
(f) Investments in connection with transactions permitted by Section
7.13; and
(g) without duplication of any of the foregoing clauses, other
Investments in an aggregate principal amount not exceeding $10,000,000 in any
Fiscal Year; provided that any acquisition must be a Non-Hostile Acquisition.
7.5 CONTINGENT OBLIGATIONS. Borrower will not, and will not permit any
of its Subsidiaries to, directly or indirectly, create or become or be liable
with respect to any Contingent Obligation, except:
(a) Borrower and its Subsidiaries may become and remain liable with
respect to guaranties resulting from endorsement of negotiable instruments for
collection or deposit in the ordinary course of business;
(b) any Material Subsidiary of Borrower may create and become liable
with respect to the Material Subsidiary Guaranty;
(c) Borrower may become and remain liable with respect to reimbursement
obligations under the Letters of Credit and Borrower may become and remain
liable with respect to any other Contingent Obligation created hereunder or
under any other Loan Document;
(Credit Agreement)
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(d) Borrower and its Subsidiaries may become and remain liable with
respect to any swap agreement, cap agreement, collar agreement or other similar
agreement or arrangement designed to protect Borrower or any of its Subsidiaries
against fluctuations in interest rates or commodity prices, so long as such
agreement or arrangement is entered into for non-speculative purposes;
(e) Borrower may become and remain liable with respect to guaranties
relating to (x) any Debt of its Subsidiaries set forth on Schedule 7.1 and any
refinancings thereof permitted pursuant to Section 7.1(e) and (y) without
duplication, Debt of its Subsidiaries in an aggregate outstanding amount not to
exceed at any time 15% of Consolidated Net Worth (as shown on the most recent
financial statements delivered pursuant to Section 6.1(a) or (b));
(f) Borrower and its Subsidiaries may become and remain liable with
respect to Contingent Obligations relating to advance payment guaranties, rent
guaranties with respect to leases and performance guaranties;
(g) Borrower and its Subsidiaries may become and remain liable with
respect to reimbursement obligations under letters of credit other than Letters
of Credit issued hereunder, in an aggregate amount outstanding at any time not
exceeding $25,000,000;
(h) the Subsidiaries of Borrower may become and remain liable with
respect to Contingent Obligations of the type described in clause (e) of the
definition of "Debt" in respect of Debt of Borrower or a Subsidiary of Borrower
if such Contingent Obligation is permitted by the provisos following subsection
(k) of this Section 7.5;
(i) Contingent Obligations created in connection with transactions
permitted by Section 7.13;
(j) Borrower may become and remain liable with respect to guaranties,
in an aggregate amount outstanding at any time not exceeding $30,000,000, in
connection with loans made by third parties to employees who are participants in
Borrower's stock purchase program, if implemented, to enable such employees to
purchase common stock of Borrower.
(k) Borrower and its Subsidiaries may create, incur, assume or suffer
to exist any obligations, contingent or otherwise (including, without
limitation, obligations as account party under any unsecured letters of credit
other than the Letters of Credit), solely in respect of surety and performance
bonds and similar obligations; provided that the aggregate amount of all such
obligations (including those outstanding on the date hereof) does not exceed
$50,000,000 for Borrower and its Subsidiaries; provided further that such
obligations are incurred in the ordinary course of the business of Borrower and
its Subsidiaries. The surety and performance bonds in effect on the date hereof
are set forth on Schedule 7.1;
provided that, notwithstanding clauses (a) through (k) of this Section 7.5, the
Subsidiaries of Borrower may not create, incur, assume or suffer to exist any
Subsidiary Debt in an aggregate principal amount outstanding at any time
exceeding 15% of Consolidated Net Worth of Borrower and its Subsidiaries (as
shown on the most recent financial statements delivered pursuant to Section
6.1(a) or (b)); provided further that, transactions of the type permitted by
Section 7.13 shall not count against any of the quantitative baskets set forth
in this Section 7.5.
(Credit Agreement)
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7.6 RESTRICTIONS ON FUNDAMENTAL CHANGES. Borrower will not, and will
not permit any of its Subsidiaries to merge or consolidate with or into, or
convey, transfer, lease or otherwise dispose of (whether in one transaction or
in a series of transactions) all or any portion of its assets or the assets of
any division (whether now owned or hereafter acquired) to any Person, except the
following, provided that no Event of Default or Default has occurred and is
continuing or would result therefrom:
(a) Borrower or any Subsidiary of Borrower may merge or consolidate
with or into another entity (including any Subsidiary of Borrower); provided
that with respect to any merger with Borrower, Borrower shall be the continuing
or surviving corporation and with respect to all other mergers, the continuing
or surviving corporation shall be a Subsidiary of Borrower;
(b) Borrower and its Subsidiaries may sell or otherwise dispose of
inventory in the ordinary course of business;
(c) Borrower and its Subsidiaries may dispose of used, obsolete, worn
out or surplus property in the ordinary course of business;
(d) any Wholly-Owned Subsidiary may transfer any assets to Borrower or
to another Wholly-Owned Subsidiary and any other Subsidiary may transfer any
assets to Borrower or to another Wholly-Owned Subsidiary;
(e) Borrower may transfer any assets to another Wholly-Owned Subsidiary
which has executed and delivered the Material Subsidiary Guaranty, or instrument
of joinder with respect thereto, and has otherwise complied with Section 6.3;
(f) Borrower and its Subsidiaries may sell or dispose of assets
permitted by Section 7.13 provided that, transactions of the type permitted by
Section 7.13 shall not count against any of the quantitative baskets set forth
in this Section 7.6; and
(g) without duplication of any of the foregoing clauses, Borrower or
any of its Subsidiaries may dispose of up to 15% of its Consolidated Total
Assets during any 12-month period, provided that if the Net Proceeds from any
Disposition are in excess of 15% of Consolidated Total Assets of Borrower and
its Subsidiaries (as shown on the most recent financial statements delivered
pursuant to Section 6.1(a) or (b)) ("Excess Net Proceeds"), such Excess Net
Proceeds shall, at Borrower's election, either be: (i) reinvested in the
business of Borrower or such Subsidiary within 12 months from the date of the
receipt of the proceeds from such disposition, or (ii) applied to prepay
outstanding Debt other than Subordinated Debt; notwithstanding the foregoing,
Borrower or any of its Subsidiaries may only dispose of up to 30% of its
Consolidated Total Assets from Closing until the date of such Disposition.
7.7 FINANCIAL COVENANTS.
(a) Leverage Ratio. Borrower will not permit, as of the end of any
Fiscal Quarter, the Leverage Ratio to exceed (i) 4.00 to 1.00 during the period
ending March 31, 2001, and (ii) 3.5 to 1.00 thereafter.
(Credit Agreement)
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(b) Interest Coverage Ratio. Borrower will not permit, as of the end of
any Fiscal Quarter, the ratio of (x) Consolidated Adjusted EBITDA to (y)
Consolidated Interest Charges for the four Fiscal Quarters ending on such date
to be less than (i) 3.50 to 1.00 during the period ending March 31, 2001, and
(ii) 4.00 to 1.00 thereafter.
(c) Maximum Senior Leverage Ratio. If any Subordinated Debt is
outstanding, Borrower will not permit, as of the end of any Fiscal Quarter, the
ratio of (x) Consolidated Funded Debt, plus the amount of outstanding Financial
Letters of Credit in excess of $25,000,000 in the aggregate as of such date,
less the outstanding principal amount of Subordinated Debt to (y) Consolidated
Adjusted EBITDA for the four Fiscal Quarters ending on such date, plus, if such
four Fiscal Quarter period covers the period in which a one time charge relating
to restructuring and integration costs is taken, up to $50,000,000 of such one
time restructuring and integration cost charge actually taken by Borrower in
1999 or the first quarter of 2000, to exceed (i) 2.50 to 1.00 during the period
ending March 31, 2001, and (ii) 2.00 to 1.00 thereafter.
7.8 DIVIDENDS, ETC. Borrower will not, and will not permit any of its
Subsidiaries to, declare or pay any dividends, purchase, redeem, retire or
otherwise acquire for value any of its capital stock now or hereafter
outstanding, or any warrants or other rights to acquire such stock, return any
capital to its stockholders as such, or make any distribution of assets to its
stockholders as such, or permit any of its Subsidiaries to purchase, redeem,
retire or otherwise acquire for value any stock of Borrower or any warrants or
other rights to acquire such stock, except that:
(a) Borrower may declare and deliver dividends and distributions
payable in common stock of Borrower;
(b) Subsidiaries wholly-owned by Borrower except for directors'
qualifying shares or foreign qualifying shares (each a "Wholly-Owned
Subsidiary") may declare, pay and deliver dividends and distributions payable in
cash, common stock or other assets to Borrower or any other Subsidiary of
Borrower; and
(c) so long as no Event of Default or Default has occurred and is
continuing or would be caused thereby, Borrower or any Subsidiary of Borrower
may purchase, redeem, retire or otherwise acquire for value its capital stock
and may declare and pay dividends payable in cash on its capital stock.
7.9 CHANGE IN BUSINESS. Subject to Section 7.6, Borrower will not and
will not permit any division or Subsidiary to make, any material change in the
nature or conduct of their respective businesses as carried on at the date
hereof.
7.10 ERISA. Borrower will not (a) permit any Pension Plan to: (i)
engage in any non-exempt "prohibited transaction" (as defined in Section 4975 of
the Code); (ii) fail to comply with ERISA or any other applicable Laws; (iii)
incur any material "accumulated funding deficiency" (as defined in Section 302
of ERISA); or (iv) terminate in any manner, which, with respect to each event
listed above, could reasonably be expected to result in liability exceeding
(Credit Agreement)
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$10,000,000, or (b) withdraw, completely or partially, from any Multiemployer
Plan if to do so could reasonably be expected to result in liability exceeding
$10,000,000.
7.11 CHARTER AND BYLAWS. Borrower will not and will not permit any
Material Subsidiary to amend, modify or change in any manner, the Certificate of
Incorporation or the Bylaws of Borrower or any such Subsidiary other than an
amendment to the Certificate of Incorporation or Bylaws which would not
materially impair the interests or the rights of the Banks under any Loan
Document.
7.12 TRANSACTIONS WITH SHAREHOLDERS AND AFFILIATES. Borrower will not,
and will not permit any of its Subsidiaries to, directly or indirectly, enter
into or permit to exist any transaction (including, without limitation, the
purchase, sale, lease or exchange of any property or the rendering of any
service) with any direct or indirect holder of 5% or more of any class of equity
Securities of Borrower or any Subsidiary, on terms that are less favorable to
Borrower or that Subsidiary, as the case may be, than those that might be
obtained at the time from Persons who are not such a holder or affiliate;
provided that the foregoing restriction shall not apply to (a) any transaction
between Borrower and any Wholly-Owned Subsidiary or between any of its
Wholly-Owned Subsidiaries including without limitation transactions of the type
permitted by Section 7.13 or (b) reasonable and customary fees paid to members
of the Boards of Directors, officers, employees or consultants of Borrower and
its Subsidiaries for services rendered to Borrower or any such Subsidiary in the
ordinary course of business, together with customary indemnities in connection
therewith and in accordance with applicable law, (c) amounts payable under
agreements with affiliates existing on the Closing Date (d) contributions to
employee benefit plans of Borrower or its Subsidiaries, and (e) dividends and
distributions permitted under Section 7.8).
7.13 RECEIVABLES PROGRAM. Borrower may, and may permit its Subsidiaries
to sell, without recourse, or with recourse not exceeding 5% of the Outstanding
Receivables Advances (as defined below), accounts receivable arising in the
ordinary course of business pursuant to an accounts receivable purchase facility
(such facility being referred to herein as the "Receivables Program"); provided
that the aggregate outstanding amount of cash advanced to Borrower and its
Subsidiaries under the Receivables Program (the "Outstanding Receivables
Advances") shall not at any time exceed $100,000,000.
7.14 NON-GUARANTOR SUBSIDIARIES. Borrower will not permit its domestic
Subsidiaries that are not party to the Material Subsidiary Guaranty to have
Consolidated Total Assets in the aggregate which account for 20% or more of the
Consolidated Total Assets of Borrower and its domestic Subsidiaries, as
determined based upon the most recent financial statements delivered pursuant to
Section 6.1.
SECTION 8
EVENTS OF DEFAULT AND REMEDIES UPON EVENT OF DEFAULT
8.1 EVENTS OF DEFAULT. The existence or occurrence of any one or more
of the following events, whatever the reason therefor and under any
circumstances whatsoever, shall constitute an Event of Default:
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(a) Failure to Make Payments When Due. Borrower shall fail to pay any
principal of any Loan when the same becomes due and payable, whether at stated
maturity, by acceleration, by notice of prepayment or otherwise; shall fail to
pay when due any amount payable to the Issuing Bank in reimbursement of any
drawing under any Letter of Credit; or shall fail to pay any interest on any
Loan or any other fees or other Obligations due under this Agreement within
three Business Days of the date due therefor; or
(b) Breach of Warranty. Any representation or warranty made by Borrower
herein (or any of its officers) in connection with this Agreement shall prove to
have been incorrect in any material respect when made or deemed made; or
(c) Breach of Certain Covenants.
(i) Borrower shall fail to perform or observe any term, covenant or
agreement contained in Section 6.4, 7.1, 7.2, 7.3, 7.4, 7.5, 7.6, 7.8,
7.9, 7.10, 7.12, or 7.13; or
(ii) Borrower shall fail to perform or observe any term, covenant
or agreement contained in Section 6.8, 6.9, 6.10, 7.7 or 7.11 if such
failure shall remain unremedied for 10 days after the earlier of (A)
the day on which a Responsible Officer of Borrower first obtains
knowledge of such failure, or (B) the day on which written notice
thereof shall have been given to Borrower by the Administrative Agent
or any Bank; or
(iii) Borrower or any of its Subsidiaries shall fail to perform or
observe any other term, covenant or agreement contained in this
Agreement or in any other Loan Document, on its part to be performed or
observed if such failure shall remain unremedied for 30 days after the
earlier of (A) the day on which a Responsible Officer of Borrower first
obtains knowledge of such failure, or (B) the day on which written
notice thereof shall have been given to Borrower by the Administrative
Agent or any Bank; or
(d) Default in Other Agreements. Borrower or any of its Subsidiaries
shall fail to pay any principal of or premium or interest on any Debt which is
outstanding in a principal amount of at least $10,000,000 (or its equivalent in
any Approved Offshore Currency) in the aggregate (but excluding Debt arising
under this Agreement) of such Borrower or such Subsidiary (as the case may be),
when the same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise), and such failure shall continue
after the applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or any other event shall occur or condition
shall exist under any agreement or instrument relating to any such Debt and
shall continue after the applicable grace period, if any, specified in such
agreement or instrument, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such Debt; or any
such Debt shall be declared to be due and payable, or required to be prepaid
(other than by a regularly scheduled required prepayment), redeemed, purchased
or defeased, or an offer to prepay, redeem, purchase or defease such Debt shall
be required to be made, in each case prior to the stated maturity thereof; or
(e) Debtor Relief Laws, Etc. Borrower or any of Material Subsidiaries
institutes or consents to the institution of any proceeding under a Debtor
Relief Law relating to it or to all or any material part of its property, or is
unable or admits in writing its inability to pay its debts as
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they mature, or makes an assignment for the benefit of creditors; or applies for
or consents to the appointment of any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer for it or for all or any material
part of its property; or any receiver, trustee, custodian, conservator,
liquidator, rehabilitator or similar officer is appointed without the
application or consent of that Person and the appointment continues undischarged
or unstayed for 30 days; or any proceeding under a Debtor Relief Law relating to
any such Person or to all or any part of its property is instituted without the
consent of that Person and continues undismissed or unstayed for 30 days; or
(f) Judgments and Attachments. Any judgment or order for the payment of
money in excess of $10,000,000 (or its equivalent in any Approved Offshore
Currency) shall be rendered against Borrower or any of its Subsidiaries, such
judgment or order shall remain unsatisfied for a period of at least 30 days and
either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of 10 consecutive
days during which a stay of enforcement of such judgment or order, by reason of
a pending appeal or otherwise, shall not be in effect. Any non-monetary judgment
or order shall be rendered against Borrower or any or its Subsidiaries that is
materially adverse to Borrower and its Subsidiaries taken as a whole, such
judgment or order shall remain unsatisfied for a period of at least 30 days and
either (i) enforcement proceedings shall have been commenced by any Person upon
such judgment or order or (ii) there shall be any period of 10 consecutive days
during which a stay of enforcement of such judgment or order, by reason of a
pending appeal or otherwise, shall not be in effect; or
(g) Guaranties. Any provision of the Material Subsidiary Guaranty after
delivery thereof or otherwise shall for any reason cease to be valid and binding
on any Material Subsidiary executing the Material Subsidiary Guaranty or such
Material Subsidiary shall so state in writing; or
(h) ERISA. An ERISA Event shall occur with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of Borrower under Title IV of ERISA to the Pension Plan,
Multiemployer Plan or the PBGC in an aggregate amount in excess of the
$10,000,000; (ii) the aggregate amount of Unfunded Pension Liability among all
Pension Plans at any time exceeds the $10,000,000; or (iii) Borrower or any
ERISA Affiliate shall fail to pay when due, after the expiration of any
applicable grace period, any installment payment with respect to its withdrawal
liability under Section 4201 of ERISA under a Multiemployer Plan in an aggregate
amount in excess of $10,000,000; or
(i) Change of Control. A Change of Control shall have occurred.
8.2 REMEDIES UPON EVENT OF DEFAULT. Without limiting any other rights
or remedies of the Administrative Agent or the Banks provided for elsewhere in
this Agreement, or the other Loan Documents, or by applicable Laws, or in
equity, or otherwise:
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(a) Upon the occurrence, and during the continuance, of any Event of
Default other than an Event of Default described in Section 8.1(e):
(1) the Commitments and all other obligations of the Administrative
Agent or the Banks and all rights of Borrower and any Material
Subsidiaries under the Loan Documents shall be suspended without notice
to or demand upon Borrower, which are expressly waived by Borrower,
except that all of the Banks or the Requisite Banks, as required
hereunder, may waive an Event of Default or, without waiving,
determine, upon terms and conditions satisfactory to the Banks or
Requisite Banks, as the case may be, to reinstate the Commitments and
make further Extensions of Credit, which waiver or determination shall
apply equally to, and shall be binding upon, all the Banks;
(2) the Issuing Bank may, with the approval of the Administrative
Agent on behalf of the Requisite Banks, demand immediate payment by
Borrower of an amount equal to the aggregate amount of all outstanding
Letters of Credit to be held by the Issuing Bank in an interest-bearing
cash collateral account as collateral hereunder; and
(3) the Requisite Banks may request the Administrative Agent to,
and the Administrative Agent thereupon shall, terminate the Commitments
and/or declare all or any part of the unpaid principal of all Loans,
all interest accrued and unpaid thereon and all other amounts payable
under the Loan Documents to be forthwith due and payable, whereupon the
same shall become and be forthwith due and payable, without protest,
presentment, notice of dishonor, demand or further notice of any kind,
all of which are expressly waived by Borrower.
(b) Upon the occurrence of any Event of Default described in Section
8.1(e):
(1) the Commitments and all other obligations of the Administrative
Agent or the Banks and all rights of Borrower and any Material
Subsidiary under the Loan Documents shall terminate without notice to
or demand upon Borrower, which are expressly waived by Borrower, except
that all the Banks may waive the Event of Default or, without waiving,
determine, upon terms and conditions satisfactory to all the Banks, to
reinstate the Commitments and make further Extensions of Credit, which
determination shall apply equally to, and shall be binding upon, all
the Banks;
(2) an amount equal to the aggregate amount of all outstanding
Letters of Credit shall be immediately due and payable to the Issuing
Bank without notice to or demand upon Borrower, which are expressly
waived by Borrower, to be held by the Issuing Bank in an
interest-bearing cash collateral account as collateral hereunder; and
(3) the unpaid principal of all Loans, all interest accrued and
unpaid thereon and all other amounts payable under the Loan Documents
shall be forthwith due and payable, without protest, presentment,
notice of dishonor, demand or further notice of any kind, all of which
are expressly waived by Borrower.
(c) Upon the occurrence of any Event of Default, the Banks and the
Administrative Agent, or any of them, without notice to (except as expressly
provided for in any Loan Document) or demand upon Borrower, which are expressly
waived by Borrower (except as to
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notices expressly provided for in any Loan Document), may proceed (but only with
the consent of the Requisite Banks) to protect, exercise and enforce their
rights and remedies under the Loan Documents against Borrower and any Material
Subsidiary and such other rights and remedies as are provided by Laws or equity.
(d) The order and manner in which the Banks' rights and remedies are to
be exercised shall be determined by the Requisite Banks in their sole
discretion, and all payments received by the Administrative Agent and the Banks,
or any of them, shall be applied first to Attorney Costs incurred by the
Administrative Agent or any Bank, and thereafter paid pro rata to the Banks in
the same proportions that the aggregate Obligations owed to each Bank under the
Loan Documents bear to the aggregate Obligations owed under the Loan Documents
to all the Banks, without priority or preference among the Banks. Regardless of
how each Bank may treat payments for the purpose of its own accounting, for the
purpose of computing Borrower's Obligations hereunder, payments shall be applied
first, to the costs and expenses of the Administrative Agent and the Banks, as
set forth above, second, to the payment of accrued and unpaid interest due under
any Loan Documents to and including the date of such application (ratably, and
without duplication, according to the accrued and unpaid interest due under each
of the Loan Documents), and third, to the payment of all other amounts
(including principal and fees) then owing to the Administrative Agent or the
Banks under the Loan Documents. No application of payments will cure any Event
of Default, or prevent acceleration, or continued acceleration, of amounts
payable under the Loan Documents, or prevent the exercise, or continued
exercise, of rights or remedies of the Banks hereunder or thereunder or at Laws
or in equity.
SECTION 9
THE ADMINISTRATIVE AGENT
9.1 APPOINTMENT AND AUTHORIZATION; "ADMINISTRATIVE AGENT".
(a) Each Bank hereby irrevocably (subject to Section 9.9) appoints,
designates and authorizes the Administrative Agent to take such action on its
behalf under the provisions of this Agreement and each other Loan Document and
to exercise such powers and perform such duties as are expressly delegated to it
by the terms of this Agreement or any other Loan Document, together with such
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary contained elsewhere in this Agreement or in any other Loan
Document, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the
Administrative Agent have or be deemed to have any fiduciary relationship with
any Bank, and no implied covenants, functions, responsibilities, duties,
obligations or liabilities shall be read into this Agreement or any other Loan
Document or otherwise exist against the Administrative Agent. Without limiting
the generality of the foregoing sentence, the use of the term "agent" in this
Agreement with reference to the Administrative Agent is not intended to connote
any fiduciary or other implied (or express) obligations arising under agency
doctrine of any applicable law. Instead, such term is used merely as a matter of
market custom, and is intended to create or reflect only an administrative
relationship between independent contracting parties.
(Credit Agreement)
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(b) The Issuing Bank shall act on behalf of the Banks with respect to
any Letters of Credit issued by it and the documents associated therewith until
such time and except for so long as the Administrative Agent may agree at the
request of the Requisite Banks to act for such Issuing Bank with respect
thereto; provided, however, that the Issuing Bank shall have all of the benefits
and immunities (i) provided to the Administrative Agent in this Section 9 with
respect to any acts taken or omissions suffered by the Issuing Bank in
connection with Letters of Credit issued by it or proposed to be issued by it
and the application and agreements for letters of credit pertaining to the
Letters of Credit as fully as if the term "Administrative Agent", as used in
this Section 9, included the Issuing Bank with respect to such acts or
omissions, and (ii) as additionally provided in this Agreement with respect to
the Issuing Bank.
9.2 DELEGATION OF DUTIES. The Administrative Agent may execute any of
its duties under this Agreement or any other Loan Document by or through agents,
employees or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects with reasonable care.
9.3 LIABILITY OF ADMINISTRATIVE AGENT. None of the Agent-Related
Persons shall (a) be liable for any action taken or omitted to be taken by any
of them under or in connection with this Agreement or any other Loan Document or
the transactions contemplated hereby (except for its own gross negligence or
willful misconduct), or (b) be responsible in any manner to any of the Banks for
any recital, statement, representation or warranty made by Borrower or any
Subsidiary or Affiliate of Borrower, or any officer thereof, contained in this
Agreement or in any other Loan Document, or in any certificate, report,
statement or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of
Borrower or any other party to any Loan Document to perform its obligations
hereunder or thereunder. No Agent-Related Person shall be under any obligation
to any Bank to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement or any
other Loan Document, or to inspect the properties, books or records of Borrower
or any of Borrower's Subsidiaries or Affiliates.
9.4 RELIANCE BY ADMINISTRATIVE AGENT.
(a) The Administrative Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Borrower),
independent accountants and other experts selected by the Administrative Agent.
The Administrative Agent shall be fully justified in failing or refusing to take
any action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Requisite Banks as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by the Banks against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any
(Credit Agreement)
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other Loan Document in accordance with a request or consent of the Requisite
Banks or all Banks, if required hereunder, and such request and any action taken
or failure to act pursuant thereto shall be binding upon all of the Banks.
(b) For purposes of determining compliance with the conditions
specified in Section 4.1, each Bank that has executed this Agreement shall be
deemed to have consented to, approved or accepted or to be satisfied with, each
document or other matter either sent by the Administrative Agent to such Bank
for consent, approval, acceptance or satisfaction, or required thereunder to be
consented to or approved by or acceptable or satisfactory to the Bank.
9.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default,
except with respect to defaults in the payment of principal, interest and fees
required to be paid to the Administrative Agent for the account of the Banks,
unless the Administrative Agent shall have received written notice from a Bank
or Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". The
Administrative Agent will notify the Banks of its receipt of any such notice.
The Administrative Agent shall take such action with respect to such Default or
Event of Default as may be requested by the Requisite Banks in accordance with
Section 8; provided, however, that unless and until the Administrative Agent has
received any such request, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable or in the best
interest of the Banks.
9.6 CREDIT DECISION. Each Bank acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Administrative Agent hereinafter taken, including any review of the
affairs of Borrower and its Subsidiaries, shall be deemed to constitute any
representation or warranty by any Agent-Related Person to any Bank. Each Bank
represents to the Administrative Agent that it has, independently and without
reliance upon any Agent-Related Person and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, prospects, operations, property, financial and
other condition and creditworthiness of Borrower and its Subsidiaries, and all
applicable bank regulatory laws relating to the transactions contemplated
hereby, and made its own decision to enter into this Agreement and to extend
credit to Borrower hereunder. Each Bank also represents that it will,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial and other condition and
creditworthiness of Borrower. Except for notices, reports and other documents
expressly herein required to be furnished to the Banks by the Administrative
Agent, the Administrative Agent shall not have any duty or responsibility to
provide any Bank with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of Borrower which may come into the possession of any of the
Agent-Related Persons.
9.7 INDEMNIFICATION OF ADMINISTRATIVE AGENT. Whether or not the
transactions contemplated hereby are consummated, the Banks shall indemnify upon
demand the
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Agent-Related Persons (to the extent not reimbursed by or on behalf of Borrower
and without limiting the obligation of Borrower to do so), pro rata, from and
against any and all Indemnified Liabilities; provided, however, that no Bank
shall be liable for the payment to the Agent-Related Persons of any portion of
such Indemnified Liabilities resulting solely from such Person's gross
negligence or willful misconduct. Without limitation of the foregoing, each Bank
shall reimburse the Administrative Agent upon demand for its ratable share of
any costs or out-of-pocket expenses (including Attorney Costs) incurred by the
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that the
Administrative Agent is not reimbursed for such expenses by or on behalf of
Borrower. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Administrative
Agent.
9.8 ADMINISTRATIVE AGENT IN INDIVIDUAL CAPACITY. Bank of America and
its Affiliates may make loans to, issue letters of credit for the account of,
accept deposits from, acquire equity interests in and generally engage in any
kind of banking, trust, financial advisory, underwriting or other business with
Borrower and its Subsidiaries and Affiliates as though Bank of America were not
the Administrative Agent or the Issuing Bank hereunder and without notice to or
consent of the Banks. The Banks acknowledge that, pursuant to such activities,
Bank of America or its Affiliates may receive information regarding Borrower or
its Affiliates (including information that may be subject to confidentiality
obligations in favor of Borrower or such Subsidiary) and acknowledge that the
Administrative Agent shall be under no obligation to provide such information to
them. With respect to its Loans, Bank of America shall have the same rights and
powers under this Agreement as any other Bank and may exercise the same as
though it were not the Administrative Agent or the Issuing Bank.
9.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may, and
at the request of the Requisite Banks shall, resign as Administrative Agent upon
30 days' notice to the Banks. If the Administrative Agent resigns under this
Agreement, the Requisite Banks shall appoint from among the Banks a successor
Administrative Agent for the Banks which successor agent shall be approved by
Borrower. If no successor agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Banks and Borrower, a successor agent from among the
Banks. Upon the acceptance of its appointment as successor agent hereunder, such
successor agent shall succeed to all the rights, powers and duties of the
retiring Administrative Agent and the term "Administrative Agent" shall mean
such successor agent and the retiring Administrative Agent's appointment, powers
and duties as Administrative Agent shall be terminated. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Section 9 and Sections 10.3 and 10.11 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was
Administrative Agent under this Agreement. If no successor agent has accepted
appointment as Administrative Agent by the date which is 30 days following a
retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become effective
and the Banks shall perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Requisite Banks appoint a successor
agent as provided for above. Notwithstanding the foregoing, however, Bank
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of America may not be removed as the Administrative Agent at the request of the
Requisite Banks unless Bank of America shall also simultaneously be replaced as
"Issuing Bank" hereunder pursuant to documentation in form and substance
reasonably satisfactory to Bank of America.
9.10 SYNDICATION AGENT, DOCUMENTATION AGENT, ETC.. The parties hereto
hereby acknowledge and agree that in connection with the syndication of the
Commitments and Loans, certain Banks hereunder have been or may be designated as
a "Co-Agent" or as the "Syndication Agent" or the "Documentation Agent." None of
the Banks so designated as a "Co-Agent" or "Syndication Agent" or "Documentation
Agent" shall have any right, power, obligation, liability, responsibility or
duty under this Agreement other than those applicable to all Banks as such.
Without limiting the foregoing, none of the Banks so designated as a "Co-Agent"
or "Syndication Agent" or "Documentation Agent" shall have or be deemed to have
any fiduciary relationship with any Bank. Each Bank acknowledges that it has not
relied, and will not rely, on any of the Banks so designated in deciding to
enter into this Agreement or in taking or not taking action hereunder.
SECTION 10
MISCELLANEOUS
10.1 CUMULATIVE REMEDIES; NO WAIVER. The rights, powers, privileges and
remedies of the Administrative Agent and the Banks provided herein or other Loan
Document are cumulative and not exclusive of any right, power, privilege or
remedy provided by Laws or equity. No failure or delay on the part of the
Administrative Agent or any Bank in exercising any right, power, privilege or
remedy may be, or may be deemed to be, a waiver thereof; nor may any single or
partial exercise of any right, power, privilege or remedy preclude any other or
further exercise of the same or any other right, power, privilege or remedy. The
terms and conditions of Section 9 are inserted for the sole benefit of the
Administrative Agent and the Banks; the same may be waived in whole or in part,
with or without terms or conditions, in respect of any Loan or Letter of Credit
without prejudicing the Administrative Agent's or the Banks' rights to assert
them in whole or in part in respect of any other Loan.
10.2 AMENDMENTS; CONSENTS. No amendment, modification, supplement,
extension, termination or waiver of any provision of this Agreement or any other
Loan Document, no approval or consent thereunder, and no consent to any
departure by Borrower therefrom, may in any event be effective unless in writing
signed by the Requisite Banks (and, in the case of any amendment, modification
or supplement of or to any Loan Document to which Borrower is a party, signed by
Borrower and, in the case of any amendment, modification or supplement to
Section 9, signed by the Administrative Agent), and then only in the specific
instance and for the specific purpose given; and, without the approval in
writing of all Banks affected thereby, no amendment, modification, supplement,
termination, waiver or consent may be effective:
(a) To reduce the principal of, or the amount of principal, principal
prepayments or the rate of interest payable on, any Loan, or the amount of the
Commitment or the Pro Rata Share of any Bank or the amount of any facility fee
payable to any Bank, or any other fee or amount payable to any Bank under the
Loan Documents or to waive an Event of Default consisting of the failure of
Borrower to pay when due principal, interest or any facility fee;
(Credit Agreement)
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(b) To postpone any date fixed for any payment of principal of,
prepayment of principal of or any installment of interest on, any Loan or any
installment of any facility fee, or to extend the term of the Commitments or
increase the Commitments, or to release any Material Subsidiary from the
Material Subsidiary Guaranty;
(c) To amend the provisions of the definition of "Requisite Banks",
Sections 4 or 9 or this Section; or
(d) To amend any provision of this Agreement that expressly requires
the consent or approval of all the Banks.
Any amendment, modification, supplement, termination, waiver or consent pursuant
to this Section shall apply equally to, and shall be binding upon, all the Banks
and the Administrative Agent.
10.3 ATTORNEY COSTS, EXPENSES AND TAXES. Borrower shall pay within five
Business Days after demand, accompanied by an invoice therefor, the reasonable
costs and expenses of the Administrative Agent in connection with the
negotiation, preparation, syndication, execution and delivery of the Loan
Documents (subject to any limitations set forth in a letter agreement between
Borrower and the Arrangers entered into prior to the Closing Date) and any
amendment thereto or waiver thereof. Borrower shall also pay on demand,
accompanied by an invoice therefor, the reasonable costs and expenses of the
Administrative Agent and the Banks in connection with the reorganization
(including a bankruptcy reorganization) and enforcement or attempted enforcement
of the Loan Documents, and any matter related thereto. The foregoing costs and
expenses shall include filing fees, recording fees, title insurance fees,
appraisal fees, search fees, and other out-of-pocket expenses and Attorney Costs
incurred by the Administrative Agent or any Bank, and independent public
accountants and other outside experts retained by the Administrative Agent or
any Bank, whether or not such costs and expenses are incurred or suffered by the
Administrative Agent or any Bank in connection with or during the course of any
bankruptcy or insolvency proceedings of Borrower or any Subsidiary thereof. Such
costs and expenses shall also include the administrative costs of the
Administrative Agent reasonably attributable to the administration of this
Agreement and the other Loan Documents. Borrower shall pay any and all
Applicable Taxes and all costs, expenses, fees and charges payable or determined
to be payable in connection with the filing or recording of this Agreement, any
other Loan Document or any other instrument or writing to be delivered hereunder
or thereunder, or in connection with any transaction pursuant hereto or thereto,
and shall reimburse, hold harmless and indemnify the Administrative Agent and
the Banks from and against any and all loss, liability or legal or other expense
with respect to or resulting from any delay in paying or failure to pay any such
tax, cost, expense, fee or charge or that any of them may suffer or incur by
reason of the failure of Borrower to perform any of its Obligations.
10.4 NATURE OF BANKS' OBLIGATIONS. The obligations of the Banks
hereunder are several and not joint or joint and several. Nothing contained in
this Agreement or any other Loan Document and no action taken by the
Administrative Agent or the Banks or any of them pursuant hereto or thereto may,
or may be deemed to, make the Banks a partnership, an association, a joint
venture or other entity, either among themselves or with Borrower or any
Affiliate of Borrower. Each Bank's obligation to make any Loan pursuant hereto
is several and
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not joint or joint and several, and in the case of the initial Loan only is
conditioned upon the performance by all other Banks of their obligations to make
initial Loans. A default by any Bank will not increase the Pro Rata Share
attributable to any other Bank. Any Bank not in default may, if it desires,
assume in such proportion as the nondefaulting Banks agree the obligations of
any Bank in default, but is not obligated to do so.
10.5 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained herein or in any other Loan Document, or in any
certificate or other writing delivered by or on behalf of Borrower or any
Material Subsidiary will survive the making of the Loans hereunder and the
execution and delivery of any Notes, and have been or will be relied upon by the
Administrative Agent and each Bank, notwithstanding any investigation made by
the Administrative Agent or any Bank or on their behalf.
10.6 NOTICES. Except as otherwise expressly provided in the Loan
Documents, all notices, requests, demands, directions and other communications
provided for therein shall be given by Requisite Notice and shall be effective
as follows:
Effective on earlier of
Mode of Delivery actual receipt and:
------------------ --------------------------------------
Courier On scheduled delivery date
Facsimile When transmission complete
Mail Fourth Business Day after deposit in U.S.
mail
Personal delivery When received
Telephone When answered
provided, however, that notice to the Administrative Agent pursuant to Section 2
or 9 shall not be effective until actually received by the Administrative Agent.
The Administrative Agent and any Bank shall be entitled to rely and act on any
notice purportedly given by or on behalf of Borrower even if such notice (a) was
not made in a manner specified herein, (b) was incomplete, (c) was not preceded
or followed by any other notice specified herein, or (d) the terms of such
notice as understood by the recipient varied from any subsequent related notice
provided for herein. Borrower shall indemnify the Administrative Agent and any
Bank from any loss, cost, expense or liability as a result of relying on any
notice permitted herein.
10.7 EXECUTION OF LOAN DOCUMENTS. Unless the Administrative Agent
otherwise specifies with respect to any Loan Document, (a) this Agreement and
any other Loan Document may be executed in any number of counterparts and any
party hereto or thereto may execute any counterpart, each of which when executed
and delivered will be deemed to be an original and all of which counterparts of
this Agreement or any other Loan Document, as the case may be, when taken
together will be deemed to be but one and the same instrument and (b) execution
of any such counterpart may be evidenced by a telecopier transmission of the
signature of such party. The execution of this Agreement or any other Loan
Document by any party hereto or thereto will not become effective until
counterparts hereof or thereof, as the case may be, have been executed by all
the parties hereto or thereto.
(Credit Agreement)
69
76
10.8 BINDING EFFECT; ASSIGNMENT.
(a) This Agreement and the other Loan Documents to which Borrower is a
party will be binding upon and inure to the benefit of Borrower, the
Administrative Agent, each of the Banks, and their respective successors and
assigns, except that, Borrower may not assign its rights hereunder or thereunder
or any interest herein or therein without the prior written consent of all the
Banks. Each Bank represents that it is not acquiring its Loans with a view to
the distribution thereof within the meaning of the Securities Act of 1933, as
amended (subject to any requirement that disposition of such Loans must be
within the control of such Bank). Any Bank may at any time pledge its Note or
any other instrument evidencing its rights as a Bank under this Agreement to a
Federal Reserve Bank, but no such pledge shall release that Bank from its
obligations hereunder or grant to such Federal Reserve Bank the rights of a Bank
hereunder absent foreclosure of such pledge.
(b) From time to time following the Closing Date, each Bank may assign
to one or more Eligible Assignees all or any portion of its Pro Rata Share;
provided that (i) such assignment shall be of a constant, and not a varying,
percentage of all of the assigning Bank's rights and obligations under this
Agreement (other than any right to make Loans owing to it), (ii), if not to a
Bank or an Affiliate of the assigning Bank, shall be consented to by Borrower at
all times other than during the existence of an Event of Default and the
Administrative Agent (which approval of Borrower shall not be unreasonably
withheld or delayed), (iii) a copy of a Notice of Assignment and Acceptance
shall be delivered to the Administrative Agent, (iv) except in the case of an
assignment to an Affiliate of the assigning Bank, to another Bank or of the
entire remaining Commitment of the assigning Bank, the assignment shall not
assign a Pro Rata Share equivalent to less than the Minimum Amount therefor, and
(v) the effective date of any such assignment shall be as specified in the
Notice of Assignment and Acceptance, but not earlier than the date which is five
Business Days after the date the Administrative Agent has received the Notice of
Assignment and Acceptance. Upon acceptance by the Administrative Agent of such
Notice Assignment and Acceptance, the Eligible Assignee named therein shall be a
Bank for all purposes of this Agreement, with the Pro Rata Share therein set
forth and, to the extent of such Pro Rata Share, the assigning Bank shall be
released from its further obligations under this Agreement. Borrower agrees that
it shall execute and deliver upon request (against delivery by the assigning
Bank to Borrower of any Note) to such assignee Bank, one or more Notes
evidencing that assignee Bank's Pro Rata Share, and to the assigning Bank if
requested, one or more Notes evidencing the remaining balance Pro Rata Share
retained by the assigning Bank.
(c) By executing and delivering a Notice of Assignment and Acceptance,
the Eligible Assignee thereunder acknowledges and agrees that: (i) other than
the representation and warranty that it is the legal and beneficial owner of the
Pro Rata Share being assigned thereby free and clear of any adverse claim, the
assigning Bank has made no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement or the execution, legality,
validity, enforceability, genuineness or sufficiency of this Agreement or any
other Loan Document; (ii) the assigning Bank has made no representation or
warranty and assumes no responsibility with respect to the financial condition
of Borrower or the performance by Borrower of the Obligations; (iii) it has
received a copy of this Agreement, together with copies of the most recent
financial statements
(Credit Agreement)
70
77
delivered pursuant to Section 6.1 and such other documents and information as it
has deemed appropriate to make its own credit analysis and decision to enter
into such Assignment and Acceptance; (iv) it will, independently and without
reliance upon the Administrative Agent or any Bank and based on such documents
and information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement; (v) it
appoints and authorizes the Administrative Agent to take such action and to
exercise such powers under this Agreement as are delegated to the Administrative
Agent by this Agreement; and (vi) it will perform in accordance with their terms
all of the obligations which by the terms of this Agreement are required to be
performed by it as a Bank.
(d) After receipt of a completed Notice of Assignment and Acceptance,
and receipt of an assignment fee of $3,500 from such Eligible Assignee, the
Administrative Agent shall, promptly following the effective date thereof,
provide to Borrower and the Banks a revised Schedule 10.6 giving effect thereto.
(e) Each Bank may from time to time grant participations to one or more
banks or other financial institutions (including another Bank) in a portion of
its Pro Rata Share; provided, however, that (i) such Bank's obligations under
this Agreement shall remain unchanged, (ii) such Bank shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) the participating banks or other financial institutions shall not be a
Bank hereunder for any purpose except, if the participation agreement so
provides, for the purposes of Section 3 (but only to the extent that the cost of
such benefits to Borrower does not exceed the cost which Borrower would have
incurred in respect of such Bank absent the participation) and Section 10.9
(subject to Section 10.10), (iv) Borrower, the Administrative Agent and the
other Banks shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement, (v) the
participation shall not restrict an increase in the Commitment or in the
granting Bank's Pro Rata Share, so long as the amount of the participation
interest is not affected thereby and (vi) the consent of the holder of such
participation interest shall not be required for amendments or waivers of
provisions of the Loan Documents other than those which (A) extend the Tranche A
Maturity Date or Tranche B Maturity Date, as applicable, as to such participant
or any other date upon which any payment of money is due to such participant,
(B) reduce the rate of interest owing to such participant, any fee or any other
monetary amount owing to such participant, (C) reduce the amount of any
installment of principal owing to such participant or (D) release any guarantor.
10.9 RIGHT OF SETOFF. If an Event of Default has occurred and is
continuing, the Administrative Agent or any Bank may exercise its rights under
Division 9 of the Uniform Commercial Code and other applicable Laws and, to the
extent permitted by applicable Laws, apply any funds in any deposit account
maintained with it by Borrower and/or any property of Borrower in its possession
against the Obligations.
10.10 SHARING OF SETOFFS. Each Bank severally agrees that if it,
through the exercise of any right of setoff, banker's lien or counterclaim
against Borrower, or otherwise, receives payment of the Obligations held by it
that is ratably more than any other Bank, through any means, receives in payment
of the Obligations held by that Bank, then, subject to applicable Laws: (a) the
Bank exercising the right of setoff, banker's lien or counterclaim or otherwise
receiving such payment shall purchase, and shall be deemed to have
simultaneously purchased,
(Credit Agreement)
71
78
from the other Bank a participation in the Obligations held by the other Bank
and shall pay to the other Bank a purchase price in an amount so that the share
of the Obligations held by each Bank after the exercise of the right of setoff,
banker's lien or counterclaim or receipt of payment shall be in the same
proportion that existed prior to the exercise of the right of setoff, banker's
lien or counterclaim or receipt of payment; and (b) such other adjustments and
purchases of participations shall be made from time to time as shall be
equitable to ensure that all of the Banks share any payment obtained in respect
of the Obligations ratably in accordance with each Bank's share of the
Obligations immediately prior to, and without taking into account, the payment;
provided that, if all or any portion of a disproportionate payment obtained as a
result of the exercise of the right of setoff, banker's lien, counterclaim or
otherwise is thereafter recovered from the purchasing Bank by Borrower or any
Person claiming through or succeeding to the rights of Borrower, the purchase of
a participation shall be rescinded and the purchase price thereof shall be
restored to the extent of the recovery, but without interest. Each Bank that
purchases a participation in the Obligations pursuant to this Section shall from
and after the purchase have the right to give all notices, requests, demands,
directions and other communications under this Agreement with respect to the
portion of the Obligations purchased to the same extent as though the purchasing
Bank were the original owner of the Obligations purchased. Borrower expressly
consents to the foregoing arrangements and agrees that any Bank holding a
participation in an Obligation so purchased may exercise any and all rights of
setoff, banker's lien or counterclaim with respect to the participation as fully
as if the Bank were the original owner of the Obligation purchased.
10.11 INDEMNITY BY BORROWER. Borrower agrees to indemnify, save and
hold harmless the Administrative Agent and each Bank and their respective
Affiliates, directors, officers, agents, attorneys and employees (collectively
the "Indemnitees") from and against: (a) any and all claims, demands, actions or
causes of action (except a claim, demand, action, or cause of action for Bank
Taxes) if the claim, demand, action or cause of action arises out of or relates
to any act or omission (or alleged act or omission) of Borrower, its Affiliates
or any of their officers, directors or stockholders relating to the Commitment,
the use or contemplated use of proceeds of any Loan, or the relationship of
Borrower and the Banks under this Agreement; (b) any administrative or
investigative proceeding by any Governmental Authority arising out of or related
to a claim, demand, action or cause of action described in subsection (a) above;
and (c) any and all liabilities, losses, costs or expenses (including Attorney
Costs) that any Indemnitee suffers or incurs as a result of the assertion of any
foregoing claim, demand, action or cause of action (all of the foregoing
collectively the "Indemnified Liabilities"); provided that no Indemnitee shall
be entitled to indemnification for any loss caused by its own gross negligence
or willful misconduct or for any loss asserted against it by another Indemnitee.
10.12 NONLIABILITY OF THE BANKS. Borrower acknowledges and agrees that:
(a) Any inspections of any property of Borrower made by or through the
Administrative Agent or the Banks are for purposes of administration of the Loan
only and Borrower is not entitled to rely upon the same (whether or not such
inspections are at the expense of Borrower);
(b) By accepting or approving anything required to be observed,
performed, fulfilled or given to the Administrative Agent or the Banks pursuant
to the Loan Documents, neither the
(Credit Agreement)
72
79
Administrative Agent nor the Banks shall be deemed to have warranted or
represented the sufficiency, legality, effectiveness or legal effect of the
same, or of any term, provision or condition thereof, and such acceptance or
approval thereof shall not constitute a warranty or representation to anyone
with respect thereto by the Administrative Agent or the Banks;
(c) The relationship between Borrower and the Administrative Agent and
the Banks is, and shall at all times remain, solely that of Borrower and
lenders; neither the Administrative Agent nor the Banks shall under any
circumstance be construed to be partners or joint venturers of Borrower or their
Affiliates; neither the Administrative Agent nor the Banks shall under any
circumstance be deemed to be in a relationship of confidence or trust or a
fiduciary relationship with Borrower or their Affiliates, or to owe any
fiduciary duty to Borrower or their Affiliates; neither the Administrative Agent
nor the Banks undertake or assume any responsibility or duty to Borrower or
their Affiliates to select, review, inspect, supervise, pass judgment upon or
inform Borrower or their Affiliates of any matter in connection with their
property or the operations of Borrower or their Affiliates; Borrower and their
Affiliates shall rely entirely upon their own judgment with respect to such
matters; and any review, inspection, supervision, exercise of judgment or supply
of information undertaken or assumed by the Administrative Agent or the Banks in
connection with such matters is solely for the protection of the Administrative
Agent and the Banks and neither Borrower nor any other Person is entitled to
rely thereon; and
(d) The Administrative Agent and the Banks shall not be responsible or
liable to any Person for any loss, damage, liability or claim of any kind
relating to injury or death to Persons or damage to property caused by the
actions, inaction or negligence of Borrower and/or its Affiliates and Borrower
hereby indemnifies and holds the Administrative Agent and the Banks harmless
from any such loss, damage, liability or claim.
10.13 NO THIRD PARTIES BENEFITED. This Agreement is made for the
purpose of defining and setting forth certain obligations, rights and duties of
Borrower, the Administrative Agent and the Banks in connection with the Loans,
and is made for the sole benefit of Borrower, the Administrative Agent and the
Banks, and the Administrative Agent's and the Banks' successors and assigns.
Except as provided in Sections 10.8 and 10.11, no other Person shall have any
rights of any nature hereunder or by reason hereof.
10.14 CONFIDENTIALITY. Each Bank agrees to hold any confidential
information that it may receive from Borrower pursuant to this Agreement in
confidence, except for disclosure: (a) to a Bank's Affiliates; (b) to other
Banks and their Affiliates; (c) to legal counsel and accountants for Borrower or
any Bank; (d) to other professional advisors to Borrower or any Bank, provided
that the recipient has accepted such information subject to a confidentiality
agreement substantially similar to this Section; (e) to regulatory officials
having jurisdiction over that Bank; (f) as required by Laws or legal process or
in connection with any legal proceeding to which that Bank and Borrower are
adverse parties; and (g) to another financial institution in connection with a
disposition or proposed disposition to that financial institution of all or part
of that Bank's interests hereunder or a participation interest in its Loans,
provided that the recipient has agreed to treat such information confidentially
on a basis similar to the foregoing. For purposes of the foregoing,
"confidential information" shall mean any information respecting Borrower or its
Subsidiaries reasonably considered by Borrower to be confidential, other than
(i) information previously filed with any Governmental Authority and available
to the public, (ii) information
(Credit Agreement)
73
80
previously published in any public medium from a source other than, directly or
indirectly, that Bank, and (iii) information previously disclosed by Borrower to
any Person not associated with Borrower without a confidentiality agreement or
obligation substantially similar to this Section. Nothing in this Section shall
be construed to create or give rise to any fiduciary duty on the part of the
Administrative Agent or the Banks to Borrower.
10.15 FURTHER ASSURANCES. Borrower and its Subsidiaries shall, at their
expense and without expense to the Banks or the Administrative Agent, do,
execute and deliver such further acts and documents as any Bank or the
Administrative Agent from time to time reasonably requires for the assuring and
confirming unto the Banks or the Administrative Agent of the rights hereby
created or intended now or hereafter so to be, or for carrying out the intention
or facilitating the performance of the terms of any Loan Document.
10.16 INTEGRATION. This Agreement, together with the other Loan
Documents and any letter agreements referred to herein, comprises the complete
and integrated agreement of the parties on the subject matter hereof and
supersedes all prior agreements, written or oral, on the subject matter hereof.
In the event of any conflict between the provisions of this Agreement and those
of any other Loan Document, the provisions of this Agreement shall control and
govern; provided that the inclusion of supplemental rights or remedies in favor
of the Administrative Agent or the Banks in any other Loan Document shall not be
deemed a conflict with this Agreement. Each Loan Document was drafted with the
joint participation of the respective parties thereto and shall be construed
neither against nor in favor of any party, but rather in accordance with the
fair meaning thereof.
10.17 FAILURE TO CHARGE NOT SUBSEQUENT WAIVER. Any decision by the
Administrative Agent or any Bank not to require payment of any interest
(including Default Interest), fee, cost or other amount payable under any Loan
Document, or to calculate any amount payable by a particular method, on any
occasion shall in no way limit or be deemed a waiver of the Administrative
Agent's or such Bank's right to require full payment of any interest (including
Default Interest), fee, cost or other amount payable under any Loan Document, or
to calculate an amount payable by another method that is not inconsistent with
this Agreement, on any other or subsequent occasion.
10.18 GOVERNING LAW. Except to the extent otherwise provided therein,
each Loan Document shall be governed by, and construed and enforced in
accordance with, the local Laws of California.
10.19 SEVERABILITY OF PROVISIONS. Any provision in any Loan Document
that is held to be inoperative, unenforceable or invalid as to any party or in
any jurisdiction shall, as to that party or jurisdiction, be inoperative,
unenforceable or invalid without affecting the remaining provisions or the
operation, enforceability or validity of that provision as to any other party or
in any other jurisdiction, and to this end the provisions of all Loan Documents
are declared to be severable.
10.20 HEADINGS. Section headings in this Agreement and the other Loan
Documents are included for convenience of reference only and are not part of
this Agreement or the other Loan Documents for any other purpose.
(Credit Agreement)
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81
10.21 TIME OF THE ESSENCE. Time is of the essence of the Loan
Documents.
10.22 FOREIGN BANKS AND PARTICIPANTS. Each Bank, and each holder of a
participation interest herein, that is a "foreign corporation, partnership or
trust" within the meaning of the Code shall deliver to the Administrative Agent,
within 20 days after the Closing Date (or after accepting an assignment or
receiving a participation interest herein) two duly signed completed copies of
either Form 1001 (relating to such Person and entitling it to a complete
exemption from withholding on all payments to be made to such Person by Borrower
pursuant to this Agreement) or Form 4224 (relating to all payments to be made to
such Person by Borrower pursuant to this Agreement) of the United States
Internal Revenue Service or such other evidence (including, if reasonably
necessary, Form W-9) satisfactory to Borrower and the Administrative Agent that
no withholding under the federal income tax laws is required with respect to
such Person. Thereafter and from time to time, each such Person shall (a)
promptly submit to the Administrative Agent such additional duly completed and
signed copies of one of such forms (or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities) as may then
be available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to Borrower and the Administrative Agent of any
available exemption from, United States withholding taxes in respect of all
payments to be made to such Person by Borrower pursuant to this Agreement and
(b) take such steps as shall not be materially disadvantageous to it, in the
reasonable judgment of such Bank, and as may be reasonably necessary (including
the re-designation of its Lending Office, if any) to avoid any requirement of
applicable Laws that Borrower make any deduction or withholding for taxes from
amounts payable to such Person. If such Persons fail to deliver the above forms
or other documentation, then the Administrative Agent may withhold from any
interest payment to such Person an amount equivalent to the applicable
withholding tax imposed by Sections 1441 and 1442 of the Code, without
reduction. If any Governmental Authority asserts that the Administrative Agent
did not properly withhold any tax or other amount from payments made in respect
of such Person, such Person shall indemnify the Administrative Agent therefor,
including all penalties and interest and costs and expenses (including Attorney
Costs) of the Administrative Agent. The obligation of the Banks under this
subsection shall survive the payment of all Obligations and the resignation or
replacement of the Administrative Agent.
10.23 REMOVAL OF A BANK. Under any circumstances set forth in this
Agreement providing that Borrower shall have the right to remove a Bank as a
party to this Agreement, such Bank shall, upon notice from Borrower, execute and
deliver a Notice of Assignment and Acceptance covering that Bank's Pro Rata
Share of the Commitments in favor of an Eligible Assignee acceptable to the
Administrative Agent as Borrower may designate, subject to (a) payment in full
by such Eligible Assignee of all principal, interest and fees owing to such Bank
through the date of assignment and (b) delivery by such Eligible Assignee of
such appropriate assurances and indemnities (which may include letters of
credit) as such Bank may reasonably require with respect to its participation
interest in any Letters of Credit then outstanding or any Swing Line Loans then
outstanding. Alternatively, Borrower may reduce the Commitments (and, for this
purpose, the Minimum Amounts for Commitment reductions shall not apply) by an
amount equal to that Bank's Pro Rata Share of the Commitments, pay and provide
to such Bank the amounts, assurances and indemnities described in (a) and (b)
above and release such Bank from its Pro Rata Share of the Commitments.
(Credit Agreement)
75
82
10.24 WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTY HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
10.25 PURPORTED ORAL AMENDMENTS. BORROWER EXPRESSLY ACKNOWLEDGES THAT
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS MAY ONLY BE AMENDED OR MODIFIED, OR
THE PROVISIONS HEREOF OR THEREOF WAIVED OR SUPPLEMENTED, BY AN INSTRUMENT IN
WRITING THAT COMPLIES WITH SECTION 10.2. BORROWER AGREES THAT IT WILL NOT RELY
ON ANY COURSE OF DEALING, COURSE OF PERFORMANCE, OR ORAL OR WRITTEN STATEMENTS
BY ANY REPRESENTATIVE OF THE ADMINISTRATIVE AGENT OR ANY BANK THAT DOES NOT
COMPLY WITH SECTION 10.2 TO EFFECT AN AMENDMENT, MODIFICATION, WAIVER OR
SUPPLEMENT TO THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS.
10.26 JUDGMENT. If, for the purposes of obtaining judgment in any
court, it is necessary to convert a sum due hereunder or any other Loan
Documents in one currency into another currency, the rate of exchange used shall
be that at which in accordance with normal banking procedures the Administrative
Agent could purchase the first currency with such other currency on the Business
Day preceding that on which final judgment is given. The obligation of Borrower
in respect of any such sum due from it to the Administrative Agent or any Bank
hereunder or under the other Loan Documents shall, notwithstanding any judgment
in a currency (the "Judgment Currency") other than that in which such sum is
denominated in accordance with the applicable provisions of this Agreement (the
"Agreement Currency"), be discharged only to the extent that on the Business Day
following receipt by the Administrative Agent of any sum adjudged to be so due
in the Judgment Currency, the Administrative Agent may in accordance with normal
banking procedures purchase the Agreement Currency with the Judgment Currency.
If the amount of the Agreement Currency so purchased is less than the sum
originally due to the Administrative Agent or any Bank in the Agreement
Currency, Borrower agrees, as a separate obligation and notwithstanding any such
judgment, to indemnify the Administrative Agent or the Bank to whom such
obligation was owing against such loss. If the amount of the Agreement Currency
so purchased is greater than the sum originally due to the Administrative Agent
or any Bank in such currency, the Administrative Agent agrees to return the
amount of any excess to Borrower (or to any other Person who may be entitled
thereto under applicable law).
(Credit Agreement)
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
FLOWSERVE CORPORATION,
a New York corporation
By: /s/ Xxxxx X. Xxxxxxxxx
---------------------------------------
Xxxxx X. Xxxxxxxxx
Vice President and Chief Financial Officer
(Credit Agreement)
S-1
84
BANK OF AMERICA, N.A., as Administrative
Agent
By: /s/ Xxxx Xxxxxx
---------------------------------------
Xxxx Xxxxxx
Vice President
(Credit Agreement)
S-2
85
BANK OF AMERICA, N.A., as
Issuing Bank and a Bank
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxxxx
Principal
(Credit Agreement)
S-3
86
BANK ONE, TEXAS, NA,
as Syndication Agent and as a Bank
By: /s/ Xxxx X. Xxxxxx
---------------------------------------
Xxxx X. Xxxxxx
Title: Managing Director
(Credit Agreement)
S-4
87
ABN AMRO BANK N.V.
as Documentation Agent and as a Bank
By: /s/ Diego Puiggari
---------------------------------------
Diego Puiggari
Group Vice President
By: /s/ C. Xxxxx Xxxxxx
---------------------------------------
C. Xxxxx Xxxxxx
Assistant Vice President
(Credit Agreement)
X-0
00
XXXXXXXX XXXX XXXX, as a Bank
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------------
Xxxxxxx X. Xxxxxxxxx
Senior Vice President
(Credit Agreement)
S-6
00
XXX XXXXXXXXXX XXXX XX XXXXX,
XXXXXXX, Xxx Xxxx Branch, as a Bank
By: /s/ Xxxxxxx X. Xxxxx
---------------------------------------
Xxxxxxx X. Xxxxx
Senior Vice President, HOUSTON OFFICE
(Credit Agreement)
S-7
90
THE BANK OF TOKYO-MITSUBISHI, LTD., as a Bank
By: /s/ XXXXXXX X. XXXXXXX
---------------------------------------
Xxxxxxx X. Xxxxxxx
Vice President
By: /s/ XXXX X. XXXXXX
---------------------------------------
Xxxx X. Xxxxxx
Vice President
(Credit Agreement)
X-0
00
XXXXX COMMERCIALE ITALIANA, LOS
ANGELES FOREIGN BRANCH, as a Bank
By: /s/ X. XXXXXXXXX
----------------------------------------
Title: X. Xxxxxxxxx, VP
-------------------------------------
By: /s/ T. GALLONETTO
----------------------------------------
Title: T. Gallonetto, AVP
-------------------------------------
(Credit Agreement)
S-9
92
HSBC BANK USA,
as a Bank
By: /s/ XXXXXX XXXXXX
----------------------------------------
Xxxxxx Xxxxxx, #9428
Title: Relationship Manager
-------------------------------------
(Credit Agreement)
S-10
93
BANK HAPOALIM B.M., as a Bank
By: /s/ [ILLEGIBLE]
----------------------------------------
Title: Senior Vice President
-------------------------------------
By: /s/ XXXXX BRIEDBART
----------------------------------------
Title: Vice President
-------------------------------------
(Credit Agreement)
S-11
00
XXXXXX XXXXXXXXX XX XXXXX, XXXXXXX
AGENCY, as a Bank
By: /s/ XXXXX X. XXXXXX
----------------------------------------
Xxxxx X. Xxxxxx
Title: Vice President
-------------------------------------
(Credit Agreement)
X-00
00
XX XXXX XXXXXXXX
GENOSSENSCHAFTSBANK AG, as a Bank
By: /s/ XXXXX XXXXXXXX
----------------------------------------
Xxxxx Xxxxxxxx
Title: Assistant Vice President
-------------------------------------
By: /s/ XXXXXXX X. XXXXXXX
----------------------------------------
Xxxxxxx X. Xxxxxxx
Title: Vice President
-------------------------------------
(Credit Agreement)
S-13
96
EXHIBIT A
REQUEST FOR EXTENSION OF CREDIT
Date: ____________, _____
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of October
7, 1999 entered into by and among Flowserve Corporation, a New York corporation
(the "Borrower"), the banks from time to time party thereto, Bank of America,
N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V. , as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
The undersigned hereby requests (select one):
[ ] A Borrowing of Loans
[ ] Conversion or Continuation of Loans
1. On ____________, _____
2. In the amount of [$]_______________.
3. In _______________.
[currency]
4. Comprised of _________________________.
[type of Loan requested]
5. If applicable: with an Interest Period of _____ months/days.
The foregoing request complies with the requirements of Section 2.2 of
the Credit Agreement. The undersigned hereby certifies that the following
statements are true on the date hereof, and will be true on the above date,
before and after giving effect and to the application of the proceeds therefrom:
(a) the representations and warranties of Borrower contained in Section
5 of the Credit Agreement are true and correct in all material respects as
though made on and as of the above date (except (i) to the extent that such
representations and warranties expressly relate solely to an earlier date and
then shall be correct as of such date and (ii) that the representation and
warranty set forth in Section 5.3 of the Credit Agreement as to lack of material
adverse change is made since the date of the then most recent financial
statement delivered pursuant to
A-1
97
Section 6.1(b) of the Credit Agreement), before and after giving effect to this
Borrowing and to the application of the proceeds therefrom, as though made on
and as of this date; and
(b) no Default or Event of Default has occurred and is continuing, or
would result from such proposed Extension of Credit.
FLOWSERVE CORPORATION,
a New York corporation
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
A-2
98
EXHIBIT B
COMPLIANCE CERTIFICATE
Financial Statement Date: __________, ____
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of October
7, 1999 entered into by and among Flowserve Corporation, a New York corporation
(the "Borrower"), the banks from time to time party thereto, Bank of America,
N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
The undersigned Responsible Officer hereby certifies as of the date
hereof that he/she is the __________________ of Borrower, and that, as such,
he/she is authorized to execute and deliver this Certificate to the
Administrative Agent on the behalf of Borrower, and that:
1. Attached as Schedule 1 hereto are either (a) the financial
statements required under Section 6.1(a) of the Credit Agreement as of the above
date, which financial statements fairly present the financial condition of
Borrower and its Subsidiaries as at the dates indicated and the results of their
operations for the periods indicated, subject to changes resulting from audit
and normal year-end adjustment; or (b) the financial statements required under
Section 6.1(b) of the Credit Agreement as of the above date, certified by Ernst
& Young LLP or other nationally recognized independent public accountants
acceptable to the Requisite Banks, which certification is unqualified (as to
going concern, scope of audit and disagreements over the accounting or other
treatment of offsets) and states that such consolidated financial statements
present fairly the financial position of Borrower and its Subsidiaries as at the
dates indicated and the results of their operations and cash flow for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years (except as otherwise stated therein) and that the examination by
such accountants in connection with such consolidated financial statements has
been made in accordance with generally accepted auditing standards.
2. The undersigned has reviewed the terms of this Credit Agreement and
has made, or caused to be made under his or her supervision, a review in
reasonable detail of the transactions and condition of Borrower and its
Subsidiaries during the accounting period covered by such attached financial
statements.
[Such review has not disclosed the existence during or at the end of
such accounting period, and the undersigned does not have knowledge of the
existence as at the date hereof, of any condition or event that constitutes an
Event of Default or Default.]
[The undersigned is aware of the following Event of Default or Default
which exists or existed during such accounting period. Attached hereto is a
description of the nature and period
B-1 (Credit Agreement)
99
of existence thereof and what action Borrower has taken, is taking and proposes
to take the respect thereto.]
3. The following financial covenant analyses and information set forth
on Schedule 2 attached hereto are true and accurate on and as of the date of
this Certificate.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
_________________, _______.
FLOWSERVE CORPORATION,
a New York corporation
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
B-2 (Credit Agreement)
100
SCHEDULE 1
Financial Statements - Attached hereto
B-3 (Credit Agreement)
101
Date: __________,
For the Fiscal Quarter/Year
ended __________,
SCHEDULE 2
to Compliance Certificate
($ in 000's)
I. SECTION 7.1 - DEBT.
A. Aggregate outstanding purchase money Debt: $____________
B. 15% of Consolidated Net Worth: $____________
Maximum Permitted: Line I.A. not to exceed Line I.B
C. Aggregate outstanding Subsidiary Debt: $____________
Maximum Permitted: Line I.C. not to exceed Line X.X
XX. SECTION 7.2(o) - LIENS.
A. Other Liens: $____________
Maximum Permitted: securing obligations not exceeding $10,000,000
III. SECTION 7.4 - INVESTMENTS AND ACQUISITIONS.
A. Additional Joint Ventures: $____________
Maximum Permitted: Line III.A. not to exceed
Line I.B
B. Additional investments: $____________
Maximum Permitted: $10,000,000
IV. SECTION 7.5 - CONTINGENT OBLIGATIONS.
A. Guaranties of outstanding Subsidiary Debt: $____________
Maximum Permitted: Line IV.A. not to exceed Line I.B
B. Section 7.5(j) contingent obligations $____________
Maximum Permitted: $30,000,000
C. Section 7.5(k) contingent obligations $____________
Maximum Permitted: $50,000,000
D. Aggregate amount of outstanding Subsidiary Debt: $____________
Maximum Permitted: 15% of Consolidated Net Worth
V. SECTION 7.6(g) - FUNDAMENTAL CHANGES.
A. 15% Test:
B-4 (Credit Agreement)
102
1. Book value of Dispositions during period of
four consecutive Fiscal Quarters ending 12
months ago("Prior Subject Period"): $____________
2. 15% of Consolidated Total Assets as of last day
of Prior Subject Period (adding back all
dispositions to such date): $____________
B. 30% Test:
1. Book value of Dispositions since Closing Date to
date hereof: $____________
2. 30% of Consolidated Total Assets as of date
hereof (adding back all dispositions): $____________
Maximum Permitted: Line V.B.1 not to exceed
Line V.B.2)
C. Reinvestment/Prepayment Test:
1. Net Proceeds from Dispositions noted in
Lines V.A.1: $____________
2 Excess Net Proceeds (Net Proceeds in excess of
15% of Consolidated Total Assets (Line C.1 less
Line A.2, greater than 0): $____________
3. Excess Net Proceeds (Line C.2) reinvested in
the business within four consecutive Fiscal
Quarters ending on above date ("Subject
Period"): $____________
4. Excess Net Proceeds applied to prepay
outstanding Debt other than Subordinated Debt
during Subject Period: $____________
Minimum Required: Lines C.3 + C.4 to equal or
exceed Line C.2
VI. SECTION 7.7(a) - LEVERAGE RATIO.
A. Consolidated Adjusted EBITDA for four consecutive
Fiscal Quarters ending on above date ("Subject
Period"):
1. Consolidated net income for Subject Period: $____________
2. Interest expense for Subject Period: $____________
3. Depreciation expense for Subject Period: $____________
4. Amortization expense of goodwill, other
intangibles and financing costs: $____________
5. Extraordinary losses: $____________
6. Income tax expense: $____________
B-5 (Credit Agreement)
103
7. Extraordinary gains on asset sales: $____________
8. Noncash extraordinary income: $____________
9. EBITDA of acquired Persons (if at least
$5,000,000 on an annualized basis for each such
Person): $____________
10. Consolidated Adjusted EBITDA (Lines l + 2 +
3 + 4 + 5 + 6 - 7 - 8 + 9): $____________
11. One time charge, if any, per definition of
"Leverage Ratio": $____________
12. Consolidated Adjusted EBITDA plus one time
charge: (Lines A.10 + A.11): $____________
B. Consolidated Funded Debt:
1. Indebtedness for borrowed money: $____________
2. Bonds (other than performance bonds)
debentures, notes or similar instruments: $____________
3. Deferred purchase price of property or
services (other than trade payables not more
than 60 days past due or being contested and
other payments made in respect of employment
contracts per definition of "Debt"): $____________
4. Capital Lease Obligations: $____________
5. Drawn but unreimbursed letters of credit and
surety bonds: $____________
6. Liability assumed or net cash proceeds with
respect to a Receivables Program: $____________
7. Consolidated Funded Debt (Lines l + 2 + 3 +
4 + 5 + 6): $____________
8. Financial Letters of Credit in the aggregate
(in excess of $25,000,000): $____________
9. Consolidated Adjusted Funded Debt including
Financial Letters of Credit (Line B.7 +
B.8): $____________
C. Leverage Ratio (Line B.9 divided by Line A.12): ____ to 1
Maximum permitted (during period ending March 31,
2001): 4.00 to 1
Maximum permitted (thereafter): 3.50 to 1
B-6 (Credit Agreement)
104
VII. SECTION 7.7(b) - INTEREST COVERAGE RATIO
A. Consolidated Adjusted EBITDA for four consecutive
Fiscal Quarters ending on above date ("Subject
Period")(Line VI.A.10): $____________
B. Consolidated Interest Charges:
1. Consolidated interest, premium payments,
fees, charges and related expenses in for
borrowed money (including capitalized
interest) and deferred purchase price of
assets: $____________
2. Portion of consolidated rent payable under
capital leases that is treated as interest: $____________
3. Consolidated Interest Charges (Lines 1 + 2): $____________
C. Interest Coverage Ratio (Line A divided by Line B.3): ____ to 1
Minimum required ratio (during period 3.5 to 1.0
ending March 31, 2001):
Minimum required ratio (thereafter): 4.0 to 1.0
VIII. SECTION 7.7(c) - MAXIMUM SENIOR LEVERAGE RATIO.
A. Consolidated Adjusted EBITDA plus one time charge
(Line VI.A.12): $____________
B. 1. Consolidated Adjusted Funded Debt including
Financial Letters of Credit (Line VI.B.9): $____________
2. Outstanding principal amount of Subordinated
Debt: $____________
3. Total: (Lines B.1 - B.2): $____________
C. Maximum Senior Leverage Ratio (Line B.3 divided by Line A): ____ to 1
B-7 (Credit Agreement)
105
Maximum permitted (during period ending March 31,
2001): 2.50 to 1.0
Maximum permitted (thereafter): 2.0 to 1.0
B-8 (Credit Agreement)
106
EXHIBIT C-1
FORM OF TRANCHE A LOAN NOTE
$_______________ [Date]
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby
promises to pay to the order of _____________________________ (the "Bank"), on
the Tranche A Maturity Date (as defined in the Credit Agreement referred to
below) the principal amount of $____________, or such lesser principal amount of
Tranche A Loans (as defined in the Credit Agreement referred to below) payable
by Borrower to the Bank on such Tranche A Maturity Date under that certain
Credit Agreement dated as of October 7, 1999 entered into by and among Flowserve
Corporation, a New York corporation (the "Borrower"), the banks from time to
time party thereto, Bank of America, N.A., as Administrative Agent and Issuing
Bank, Bank One, Texas, NA, as Syndication Agent and ABN Amro Bank N.V., as
Documentation Agent (as extended, renewed, amended or restated from time to
time, the "Credit Agreement;" the terms defined therein being used herein as
therein defined).
Borrower promises to pay interest on the unpaid principal
amount of each Tranche A Loan from the date of such Tranche A Loan until such
principal amount is paid in full, at such interest rates, and payable at such
times as are specified in the Credit Agreement.
All payments of principal and interest with respect to any
Tranche A Loan shall be made to the Administrative Agent for the account of the
Bank in the currency of such Tranche A Loan in immediately available funds at
Administrative Agent's Payment office.
If any amount is not paid in full when due hereunder, such
unpaid amount shall bear interest, to be paid upon demand, from the due date
thereof until the date of actual payment (and before as well as after judgment)
computed at the per annum rate set forth in the Credit Agreement.
This Tranche A Loan Note is one of the "Tranche A Loan Notes"
referred to in the Credit Agreement. Reference is hereby made to the Credit
Agreement for rights and obligations of payment and prepayment, events of
default and the right of the Bank to accelerate the maturity hereof upon the
occurrence of such events.
Borrower, for itself, its successors and assigns, hereby
waives diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Tranche A Loan Note.
Borrower agrees to pay all collection expenses, court costs
and Attorney Costs (whether or not litigation is commenced) which may be
incurred by the Bank in connection with the collection or enforcement of this
Tranche A Loan Note.
C-1 - 1 (Credit Agreement)
107
THIS TRANCHE A LOAN NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
FLOWSERVE CORPORATION,
a New York corporation
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
C-1 - 2 (Credit Agreement)
108
EXHIBIT C-2
FORM OF TRANCHE B LOAN NOTE
$_______________ [Date]
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby
promises to pay to the order of _____________________________ (the "Bank"), on
the Tranche B Maturity Date (as defined in the Credit Agreement referred to
below) the principal amount of $____________, or such lesser principal amount of
Tranche B Loans (as defined in the Credit Agreement referred to below) payable
by Borrower to the Bank on such Tranche B Maturity Date under that certain
Credit Agreement dated as of October 7, 1999 entered into by and among Flowserve
Corporation, a New York corporation (the "Borrower"), the banks from time to
time party thereto, Bank of America, N.A., as Administrative Agent and Issuing
Bank, Bank One, Texas, NA, as Syndication Agent and ABN Amro Bank N.V., as
Documentation Agent (as extended, renewed, amended or restated from time to
time, the "Credit Agreement;" the terms defined therein being used herein as
therein defined).
Borrower promises to pay interest on the unpaid principal
amount of each Tranche B Loan from the date of such Tranche B Loan until such
principal amount is paid in full, at such interest rates, and payable at such
times as are specified in the Credit Agreement.
All payments of principal and interest with respect to any
Tranche B Loan shall be made to the Administrative Agent for the account of the
Bank in the currency of such Tranche B Loan in immediately available funds at
Administrative Agent's Payment office.
If any amount is not paid in full when due hereunder, such
unpaid amount shall bear interest, to be paid upon demand, from the due date
thereof until the date of actual payment (and before as well as after judgment)
computed at the per annum rate set forth in the Credit Agreement.
This Tranche B Loan Note is one of the "Tranche B Loan Notes"
referred to in the Credit Agreement. Reference is hereby made to the Credit
Agreement for rights and obligations of payment and prepayment, events of
default and the right of the Bank to accelerate the maturity hereof upon the
occurrence of such events.
Borrower, for itself, its successors and assigns, hereby
waives diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Tranche B Loan Note.
Borrower agrees to pay all collection expenses, court costs
and Attorney Costs (whether or not litigation is commenced) which may be
incurred by the Bank in connection with the collection or enforcement of this
Tranche B Loan Note.
C-2 - 1 (Credit Agreement)
109
THIS TRANCHE B LOAN NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
FLOWSERVE CORPORATION,
a New York corporation
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
C-2 - 2 (Credit Agreement)
110
EXHIBIT C-3
FORM OF SWING LINE NOTE
$_______________ [Date]
FOR VALUE RECEIVED, the undersigned (the "Borrower"), hereby
promises to pay to the order of _____________________________ (the "Bank"), on
the Tranche A Maturity Date (as defined in the Credit Agreement referred to
below) the principal amount of $____________, or such lesser principal amount of
Swing Line Loans (as defined in the Credit Agreement referred to below) payable
by Borrower to the Bank on such Tranche A Maturity Date under that certain
Credit Agreement dated as of October 7, 1999 entered into by and among Flowserve
Corporation, a New York corporation (the "Borrower"), the banks from time to
time party thereto, Bank of America, N.A., as Administrative Agent and Issuing
Bank, Bank One, Texas, NA, as Syndication Agent and ABN Amro Bank N.V., as
Documentation Agent (as extended, renewed, amended or restated from time to
time, the "Credit Agreement;" the terms defined therein being used herein as
therein defined).
Borrower promises to pay interest on the unpaid principal
amount of each Swing Line Loan from the date of such Swing Line Loan until such
principal amount is paid in full, at such interest rates, and payable at such
times as are specified in the Credit Agreement.
All payments of principal and interest with respect to any
Swing Line Loan shall be made to the Administrative Agent for the account of the
Bank in the currency of such Swing Line Loan in immediately available funds at
Administrative Agent's Payment office.
If any amount is not paid in full when due hereunder, such
unpaid amount shall bear interest, to be paid upon demand, from the due date
thereof until the date of actual payment (and before as well as after judgment)
computed at the per annum rate set forth in the Credit Agreement.
This Swing Line Note is the "Swing Line Note" referred to in
the Credit Agreement. Reference is hereby made to the Credit Agreement for
rights and obligations of payment and prepayment, events of default and the
right of the Bank to accelerate the maturity hereof upon the occurrence of such
events.
Borrower, for itself, its successors and assigns, hereby
waives diligence, presentment, protest and demand and notice of protest, demand,
dishonor and non-payment of this Swing Line Note.
Borrower agrees to pay all collection expenses, court costs
and Attorney Costs (whether or not litigation is commenced) which may be
incurred by the Bank in connection with the collection or enforcement of this
Swing Line Note.
C-3 - 1 (Credit Agreement)
111
THIS SWING LINE NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.
FLOWSERVE CORPORATION,
By:
-------------------------------
Name:
-----------------------------
Title:
----------------------------
C-3 - 2 (Credit Agreement)
112
EXHIBIT D
FORM OF NOTICE OF ASSIGNMENT AND ACCEPTANCE
--------------, ----
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of
October 7, 1999 entered into by and among Flowserve Corporation, a New York
corporation (the "Borrower"), the banks from time to time party thereto, Bank of
America, N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
1. We hereby give you notice of, and request your consent to,
the assignment by _____________________ (the "Assignor") to
_____________________ (the "Assignee") of _________% of the right, title and
interest of the Assignor in and to the Loan Documents, including without
limitation the right, title and interest of the Assignor in and to the
Commitment of the Assignor, all outstanding Loans made by the Assignor and
outstanding Letter of Credit Usage. Before giving effect to such assignment:
(a) the aggregate amount of the Assignor's Commitment is
$______________;
(b) the aggregate principal amount of its outstanding Loans is
$___________; and
(c) the aggregate face amount of Letter of Credit Usage is
$________________.
The Assignee hereby represents and warrants that it has
complied with the requirements of Section 10.8 of the Credit Agreement in
connection with this assignment.
3. The Assignee agrees that, upon receiving your consent to
such assignment and from and after _________________, _____the Assignee will be
bound by the terms of the Loan Documents, with respect to the interest in the
Loan Documents assigned to it as specified above, as fully and to the same
extent as if the Assignee were the Bank originally holding such interest in the
Loan Documents.
D-1 (Credit Agreement)
113
4. The following administrative details apply to the Assignee:
(a) Offshore Lending Office:
Assignee name:
---------------------------------
Address:
---------------------------------------
-----------------------------------------------
Attention:
-------------------------------------
Telephone: ( )
--- ------------------------------
Telecopier: ( )
--- ------------------------------
(b) Domestic Lending Office:
Assignee name:
---------------------------------
Address:
---------------------------------------
-----------------------------------------------
Attention:
-------------------------------------
Telephone: ( )
--- ------------------------------
Telecopier: ( )
--- ------------------------------
(c) Notice Address:
Assignee name:
---------------------------------
Address:
---------------------------------------
-----------------------------------------------
Attention:
-------------------------------------
Telephone: ( )
--- ------------------------------
Telecopier: ( )
--- ------------------------------
(d) Payment Instructions: Account No.:
Account No.
------------------------------------
Attention:
-------------------------------------
Reference:
-------------------------------------
D-2 (Credit Agreement)
114
IN WITNESS WHEREOF, the Assignor and the Assignee have caused
this Notice of Assignment and Acceptance to be executed by their respective duly
authorized officials, officers or agents as of the date first above mentioned.
Very truly yours,
[NAME OF ASSIGNOR]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[NAME OF ASSIGNEE]
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
We hereby consent to the foregoing assignment.
FLOWSERVE CORPORATION
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
BANK OF AMERICA, N.A.,
AS ADMINISTRATIVE AGENT
By:
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
D-3 (Credit Agreement)
115
EXHIBIT E
MATERIAL SUBSIDIARY GUARANTY
This Material Subsidiary Guaranty is entered into as of [ ] by
[ ], a [ ] corporation (collectively, "Subsidiary Guarantors"), jointly
and severally, in favor of and for the benefit of Bank of America, N.A., as
Administrative Agent for and representative of (in such capacity herein called
"Administrative Agent") itself, the Banks and the Issuing Bank (as each such
term is defined in the Credit Agreement referenced below).
RECITALS
A. Flowserve Corporation, a New York corporation (the "Borrower") is
entering into that certain Credit Agreement dated as of October 7, 1999 entered
into by and among Borrower, the banks from time to time party thereto, Bank of
America, N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
B. A portion of the proceeds of the Loans may be loaned to the
Subsidiary Guarantors and Letters of Credit may be issued for the benefit of the
Subsidiary Guarantors and thus the Guarantied Obligations (as hereinafter
defined) are being incurred for and will inure to the benefit of the Subsidiary
Guarantors (which benefits are hereby acknowledged).
C. It is a condition precedent to the making of the Loans and issuance
of Letters of Credit that Borrower's obligations under the Credit Agreement be
guaranteed by the Subsidiary Guarantors.
D. Subsidiary Guarantors are willing irrevocably and unconditionally to
guaranty such obligations of Borrower.
NOW, THEREFORE, based upon the foregoing and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, and
in order to induce Banks, the Issuing Bank and Administrative Agent to make the
Loans and issue Letters of Credit, the Subsidiary Guarantors hereby agree as
follows:
SECTION 1. DEFINITIONS
1.1 Certain Defined Terms. As used in this Subsidiary Guaranty, the
following terms shall have the following meanings unless the context otherwise
requires:
"Guarantied Obligations" has the meaning assigned to that term in
Section 2.1.
"Payment in full", "paid in full" or any similar term means payment in
full of the Guarantied Obligations including, without limitation, all principal,
interest, costs, fees and expenses (including, without limitation, legal fees
and expenses) of Banks and Administrative Agent as required under the Loan
Documents.
E-1 (Credit Agreement)
116
"Subsidiary Guaranty" means this Subsidiary Guaranty.
1.2 Interpretation.
(a) References to "Sections" shall be to Sections of this Subsidiary
Guaranty unless otherwise specifically provided. All accounting terms not
otherwise defined herein shall have the meanings assigned to them under
generally accepted accounting principles.
(b) In the event of any conflict or inconsistency between the terms,
conditions and provisions of this Subsidiary Guaranty and the terms, conditions
and provisions of the Credit Agreement, the terms, conditions and provisions of
this Subsidiary Guaranty shall prevail.
SECTION 2. THE GUARANTY
2.1 Guaranty of the Guarantied Obligations. Subsidiary Guarantors
hereby irrevocably and unconditionally guaranty, as primary obligor and not
merely as surety, the due and punctual payment in full of all Guarantied
Obligations when the same shall become due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
amounts that would become due but for the operation of the automatic stay under
Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)). The term
"Guarantied Obligations" is used herein in its most comprehensive sense and
includes:
(a) any and all Obligations of Borrower now or hereafter made, incurred
or created, whether absolute or contingent, liquidated or unliquidated, whether
due or not due, and however arising under or in connection with the Credit
Agreement and the other Loan Documents, including those arising under successive
borrowing transactions under the Credit Agreement which shall either continue
the Obligations of Borrower or from time to time renew them after they have been
satisfied; and
(b) those expenses set forth in Section 2.9 hereof.
2.2 Limitation on Amount Guarantied; Contribution by Subsidiary
Guarantors.
(a) Anything contained in this Subsidiary Guaranty to the contrary
notwithstanding, if any Fraudulent Transfer Law (as hereinafter defined) is
determined by a court of competent jurisdiction to be applicable to the
obligations of the Subsidiary Guarantors under this Subsidiary Guaranty, such
obligations of the Subsidiary Guarantors hereunder shall be limited to a maximum
aggregate amount equal to the largest amount that would not render their
obligations hereunder subject to avoidance as a fraudulent transfer or
conveyance under Section 548 of Title 11 of the United States Code or any
applicable provisions of comparable state law (collectively, the "Fraudulent
Transfer Laws"), in each case after giving effect to all other liabilities of
the Subsidiary Guarantors, contingent or otherwise, that are relevant under the
Fraudulent Transfer Laws (specifically excluding, however, any liabilities of
the Subsidiary Guarantors (x) in respect of intercompany indebtedness to
Borrower or other affiliates of Borrower to the extent that such indebtedness
would be discharged in an amount equal to the amount paid by the Subsidiary
Guarantors hereunder and (y) under any guaranty of Subordinated Indebtedness
which guaranty contains a limitation as to maximum amount similar to that set
forth in this Section 2.2(a), pursuant to which the liability of the Subsidiary
Guarantors hereunder is included in the
E-2 (Credit Agreement)
117
liabilities taken into account in determining such maximum amount) and after
giving effect as assets to the value (as determined under the applicable
provisions of the Fraudulent Transfer Laws) of any rights to subrogation,
reimbursement, indemnification or contribution of the Subsidiary Guarantors
pursuant to applicable law or pursuant to the terms of any agreement (including
without limitation any such right of contribution under a Related Guaranty (as
hereinafter defined) as contemplated by Section 2.2(b)).
(b) Subsidiary Guarantors under this Subsidiary Guaranty, and each
guarantor under other guaranties, if any, relating to the Credit Agreement (the
"Related Guaranties") which contain a contribution provision similar to that set
forth in this Section 2.2(b), together desire to allocate among themselves
(collectively, the "Contributing Guarantors"), in a fair and equitable manner,
their obligations arising under this Subsidiary Guaranty and the Related
Guaranties. Accordingly, in the event any payment or distribution is made on any
date by the Subsidiary Guarantors under this Subsidiary Guaranty or a guarantor
under a Related Guaranty (a "Funding Guarantor") that exceeds its Fair Share (as
defined below) as of such date, that Funding Guarantor shall be entitled to a
contribution from each of the other Contributing Guarantors in the amount of
such other Contributing Guarantor's Fair Share Shortfall (as defined below) as
of such date, with the result that all such contributions will cause each
Contributing Guarantor's Aggregate Payments (as defined below) to equal its Fair
Share as of such date. "Fair Share" means, with respect to a Contributing
Guarantor as of any date of determination, an amount equal to (i) the ratio of
(x) the Adjusted Maximum Amount (as defined below) with respect to such
Contributing Guarantor to (y) the aggregate of the Adjusted Maximum Amounts with
respect to all Contributing Guarantors, multiplied by (ii) the aggregate amount
paid or distributed on or before such date by all Funding Guarantors under this
Subsidiary Guaranty and the Related Guaranties in respect of the obligations
guarantied. "Fair Share Shortfall" means, with respect to a Contributing
Guarantor as of any date of determination, the excess, if any, of the Fair Share
of such Contributing Guarantor over the Aggregate Payments of such Contributing
Guarantor. "Adjusted Maximum Amount" means, with respect to a Contributing
Guarantor as of any date of determination, the maximum aggregate amount of the
obligations of such Contributing Guarantor under this Subsidiary Guaranty and
the Related Guaranties, determined as of such date in accordance with Section
2.2(a) or, if applicable, a similar provision contained in a Related Guaranty;
provided that, solely for purposes of calculating the "Adjusted Maximum Amount"
with respect to any Contributing Guarantor for purposes of this Section 2.2(b),
any assets or liabilities of such Contributing Guarantor arising by virtue of
any rights to subrogation, reimbursement or indemnification or any rights to or
obligations of contribution hereunder or under any similar provision contained
in a Related Guaranty shall not be considered as assets or liabilities of such
Contributing Guarantor. "Aggregate Payments" means, with respect to a
Contributing Guarantor as of any date of determination, an amount equal to (i)
the aggregate amount of all payments and distributions made on or before such
date by such Contributing Guarantor in respect of this Subsidiary Guaranty and
the Related Guaranties (including, without limitation, in respect of this
Section 2.2(b) or any similar provision contained in a Related Guaranty) minus
(ii) the aggregate amount of all payments received on or before such date by
such Contributing Guarantor from the other Contributing Guarantors as
contributions under this Section 2.2(b) or any similar provision contained in a
Related Guaranty. The amounts payable as contributions hereunder and under
similar provisions in the Related Guaranties shall be determined as of the date
on which the related payment or distribution is made by the applicable Funding
Guarantor. The allocation among Contributing Guarantors of their obligations as
set
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forth in this Section 2.2(b) or any similar provision contained in a Related
Guaranty shall not be construed in any way to limit the liability of any
Contributing Guarantor hereunder or under a Related Guaranty. Each Contributing
Guarantor under a Related Guaranty is a third party beneficiary to the
contribution agreement set forth in this Section 2.2(b).
2.3 Liability of Subsidiary Guarantors. Subsidiary Guarantors agree
that their obligations hereunder are irrevocable, absolute, independent and
unconditional and shall not be affected by any circumstance which constitutes a
legal or equitable discharge of a guarantor or surety other than indefeasible
payment in full of the Guarantied Obligations, the termination of the
Commitments, and the expiration or cancellation of all Letters of Credit. In
furtherance of the foregoing and without limiting the generality thereof, the
Subsidiary Guarantors agree as follows:
(a) This Subsidiary Guaranty is a guaranty of payment when due and not
of collectibility.
(b) Administrative Agent may enforce this Subsidiary Guaranty upon the
occurrence of an Event of Default under the Credit Agreement notwithstanding the
existence of any dispute between Banks and Borrower with respect to the
existence of such Event of Default.
(c) The obligations of the Subsidiary Guarantors hereunder are
independent of the obligations of Borrower under the Loan Documents and the
obligations of any other guarantor of the obligations of Borrower under the Loan
Documents, and a separate action or actions may be brought and prosecuted
against the Subsidiary Guarantors whether or not any action is brought against
Borrower or any of such other guarantors and whether or not Borrower is joined
in any such action or actions.
(d) Subsidiary Guarantors payment of a portion, but not all, of the
Guarantied Obligations shall in no way limit, affect, modify or abridge the
Subsidiary Guarantors' liability for any portion of the Guarantied Obligations
which has not been paid. Without limiting the generality of the foregoing, if
Administrative Agent is awarded a judgment in any suit brought to enforce the
Subsidiary Guarantors covenant to pay a portion of the Guarantied Obligations,
such judgment shall not be deemed to release the Subsidiary Guarantors from
their covenant to pay the portion of the Guarantied Obligations that is not the
subject of such suit.
(e) Administrative Agent or any Bank, upon such terms as it deems
appropriate, without notice or demand and without affecting the validity or
enforceability of this Subsidiary Guaranty or giving rise to any reduction,
limitation, impairment, discharge or termination of the Subsidiary Guarantors'
liability hereunder, from time to time may (i) renew, extend, accelerate,
increase the rate of interest on, or otherwise change the time, place, manner or
terms of payment of the Guarantied Obligations, (ii) settle, compromise, release
or discharge, or accept or refuse any offer of performance with respect to, or
substitutions for, the Guarantied Obligations or any agreement relating thereto
and/or subordinate the payment of the same to the payment of any other
obligations; (iii) request and accept other guaranties of the Guarantied
Obligations and take and hold security for the payment of this Subsidiary
Guaranty or the Guarantied Obligations; (iv) release, surrender, exchange,
substitute, compromise, settle, rescind, waive, alter, subordinate or modify,
with or without consideration, any security for payment of the Guarantied
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Obligations, any other guaranties of the Guarantied Obligations, or any other
obligation of any Person with respect to the Guarantied Obligations; (v) enforce
and apply any security now or hereafter held by or for the benefit of
Administrative Agent or any Bank in respect of this Subsidiary Guaranty or the
Guarantied Obligations and direct the order or manner of sale thereof, or
exercise any other right or remedy that Administrative Agent or Banks, or any of
them, may have against any such security, as Administrative Agent in its
discretion may determine consistent with the Credit Agreement and any applicable
security agreement, including foreclosure on any such security pursuant to one
or more judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable, and even though such action operates to impair
or extinguish any right of reimbursement or subrogation or other right or remedy
of the Subsidiary Guarantors against Borrower or any security for the Guarantied
Obligations; and (vi) exercise any other rights available to it under the Loan
Documents.
(f) This Subsidiary Guaranty and the obligations of the Subsidiary
Guarantors hereunder shall be valid and enforceable and shall not be subject to
any reduction, limitation, impairment, discharge or termination for any reason
(other than indefeasible payment in full of the Guarantied Obligations, the
termination of the Commitments, and the expiration or cancellation of all
Letters of Credit), including without limitation the occurrence of any of the
following, whether or not the Subsidiary Guarantors shall have had notice or
knowledge of any of them: (i) any failure or omission to assert or enforce or
agreement or election not to assert or enforce, or the stay or enjoining, by
order of court, by operation of law or otherwise, of the exercise or enforcement
of, any claim or demand or any right, power or remedy (whether arising under the
Loan Documents, at law, in equity or otherwise) with respect to the Guarantied
Obligations or any agreement relating thereto, or with respect to any other
guaranty of or security for the payment of the Guarantied Obligations; (ii) any
rescission, waiver, amendment or modification of, or any consent to departure
from, any of the terms or provisions (including without limitation provisions
relating to events of default) of the Credit Agreement, any of the other Loan
Documents or any agreement or instrument executed pursuant thereto, or of any
other guaranty or security for the Guarantied Obligations, in each case whether
or not in accordance with the terms of the Credit Agreement or such Loan
Document or any agreement relating to such other guaranty or security; (iii) the
Guarantied Obligations, or any agreement relating thereto, at any time being
found to be illegal, invalid or unenforceable in any respect; (iv) the
application of payments received from any source (other than payments received
pursuant to the other Loan Documents or from the proceeds of any security for
the Guarantied Obligations, except to the extent such security also serves as
collateral for indebtedness other than the Guarantied Obligations) to the
payment of indebtedness other than the Guarantied Obligations, even though
Administrative Agent or Banks, or any of them, might have elected to apply such
payment to any part or all of the Guarantied Obligations; (v) any Bank's or
Administrative Agent's consent to the change, reorganization or termination of
the corporate structure or existence of Borrower or any of its Subsidiaries and
to any corresponding restructuring of the Guarantied Obligations; (vi) any
failure to perfect or continue perfection of a security interest in any
collateral which secures any of the Guarantied Obligations; (vii) any defenses,
set-offs or counterclaims which Borrower may allege or assert against
Administrative Agent or any Bank in respect of the Guarantied Obligations,
including but not limited to failure of consideration, breach of warranty,
payment, statute of frauds, statute of limitations, accord and satisfaction and
usury; and (viii) any other act or thing or omission, or delay to do any other
act or thing, which
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may or might in any manner or to any extent vary the risk of the Subsidiary
Guarantors as an obligor in respect of the Guarantied Obligations.
2.4 Waivers by Subsidiary Guarantors. Subsidiary Guarantors hereby
waive, for the benefit of Banks and Administrative Agent:
(a) any right to require Administrative Agent or Banks, as a condition
of payment or performance by the Subsidiary Guarantors, to (i) proceed against
Borrower, any other guarantor of the Guarantied Obligations or any other Person,
(ii) proceed against or exhaust any security held from Borrower, any other
guarantor of the Guarantied Obligations or any other Person, (iii) proceed
against or have resort to any balance of any deposit account or credit on the
books of Administrative Agent or any Bank in favor of Borrower or any other
Person, or (iv) pursue any other remedy in the power of Administrative Agent or
any Bank whatsoever;
(b) any defense arising by reason of the incapacity, lack of authority
or any disability or other defense of Borrower including, without limitation,
any defense based on or arising out of the lack of validity or the
unenforceability of the Guarantied Obligations or any agreement or instrument
relating thereto or by reason of the cessation of the liability of Borrower from
any cause other than indefeasible payment in full of the Guarantied Obligations,
the termination of the Commitments, and the expiration or cancellation of all
Letters of Credit;
(c) any defense based upon any statute or rule of law which provides
that the obligation of a surety must be neither larger in amount nor in other
respects more burdensome than that of the principal;
(d) any defense based upon Administrative Agent's or any Bank's errors
or omissions in the administration of the Guarantied Obligations, except
behavior which amounts to bad faith;
(e) (i) any principles or provisions of law, statutory or otherwise,
which are or might be in conflict with the terms of this Subsidiary Guaranty and
any legal or equitable discharge of the Subsidiary Guarantors' obligations
hereunder, (ii) the benefit of any statute of limitations affecting the
Subsidiary Guarantors' liability hereunder or the enforcement hereof, (iii) any
rights to set-offs, recoupments and counterclaims, and (iv) promptness,
diligence and any requirement that Administrative Agent or any Bank protect,
secure, perfect or insure any security interest or lien or any property subject
thereto;
(f) notices, demands, presentments, protests, notices of protest,
notices of dishonor and notices of any action or inaction, including acceptance
of this Subsidiary Guaranty, notices of default under the Credit Agreement or
any agreement or instrument related thereto, notices of any renewal, extension
or modification of the Guarantied Obligations or any agreement related thereto,
notices of any extension of credit to Borrower and notices of any of the matters
referred to in Section 2.3 and any right to consent to any thereof; and
(g) any defenses or benefits that may be derived from or afforded by
law which limit the liability of or exonerate guarantors or sureties, or which
may conflict with the terms of this Subsidiary Guaranty.
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2.5 Payment by Subsidiary Guarantors; Application of Payments.
Subsidiary Guarantors hereby agree, in furtherance of the foregoing and not in
limitation of any other right which Administrative Agent or any other Person may
have at law or in equity against the Subsidiary Guarantors by virtue hereof,
upon the failure of Borrower to pay any of the Guarantied Obligations when and
as the same shall become due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including amounts
that would become due but for the operation of the automatic stay under Section
362(a) of the Bankruptcy Code, 11 U.S.C. Section 362(a)), the Subsidiary
Guarantors will forthwith pay, or cause to be paid, in cash, to Administrative
Agent for the ratable benefit of Banks, an amount equal to the sum of the unpaid
principal amount of all Guarantied Obligations then due as aforesaid, accrued
and unpaid interest on such Guarantied Obligations (including, without
limitation, interest which, but for the filing of a petition in bankruptcy with
respect to Borrower, would have accrued on such Guarantied Obligations, whether
or not a claim is allowed against Borrower for such interest in any such
bankruptcy proceeding) and all other Guarantied Obligations then owed to
Administrative Agent and/or Banks as aforesaid. All such payments shall be
applied promptly from time to time by Administrative Agent:
First, to the payment of the costs and expenses of any collection or
other realization under this Subsidiary Guaranty, including reasonable
compensation to Administrative Agent and its agents and counsel, and all
expenses, liabilities and Loans made or incurred by Administrative Agent in
connection therewith;
Second, to the payment of all other Guarantied Obligations; and
Third, after payment in full of all Guarantied Obligations, to the
payment to the Subsidiary Guarantors, or their successors or assigns, or to
whomsoever may be lawfully entitled to receive the same or as a court of
competent jurisdiction may direct, of any surplus then remaining from such
payments.
2.6 Subrogation. Until the Guarantied Obligations shall have been
indefeasibly paid in full and the Commitments shall have terminated and all
Letters of Credit shall have expired or been cancelled or cash collateralized
pursuant to the terms of the Credit Agreement, the Subsidiary Guarantors shall
withhold exercise of (a) any right of subrogation, (b) any right of contribution
the Subsidiary Guarantors may have against any other guarantor of the Guarantied
Obligations, (c) any right to enforce any remedy which Administrative Agent or
any Bank now has or may hereafter have against Borrower or (d) any benefit of,
and any right to participate in, any security now or hereafter held by
Administrative Agent or any Bank. Subsidiary Guarantors further agree that, to
the extent the waiver of its rights of subrogation and contribution as set forth
herein is found by a court of competent jurisdiction to be void or voidable for
any reason, any rights of subrogation the Subsidiary Guarantors may have against
Borrower or against any collateral or security, and any rights of contribution
the Subsidiary Guarantors may have against any other guarantor, shall be junior
and subordinate to any rights Administrative Agent or Banks may have against
Borrower, to all right, title and interest Administrative Agent or Banks may
have in any such collateral or security, and to any right Administrative Agent
or Banks may have against such other guarantor. Administrative Agent, on behalf
of Banks, may use, sell or dispose of any item of collateral or security as it
sees fit without regard to any subrogation rights the Subsidiary Guarantors may
have, and upon any such disposition or sale any rights of subrogation
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the Subsidiary Guarantors may have shall terminate. If any amount shall be paid
to the Subsidiary Guarantors on account of such subrogation rights at any time
when all Guarantied Obligations shall not have been paid in full, such amount
shall be held in trust for Administrative Agent on behalf of Banks and shall
forthwith be paid over to Administrative Agent for the benefit of Banks to be
credited and applied against the Guarantied Obligations, whether matured or
unmatured, in accordance with the terms of the Credit Agreement or any
applicable security agreement.
2.7 Subordination of Other Obligations. Any indebtedness of Borrower
now or hereafter held by the Subsidiary Guarantors is hereby subordinated in
right of payment to the Guarantied Obligations, and any such indebtedness of
Borrower to the Subsidiary Guarantors collected or received by the Subsidiary
Guarantors after an Event of Default has occurred and is continuing shall be
held in trust for Administrative Agent on behalf of Banks and shall forthwith be
paid over to Administrative Agent for the benefit of Banks to be credited and
applied against the Guarantied Obligations but without affecting, impairing or
limiting in any manner the liability of the Subsidiary Guarantors under any
other provision of this Subsidiary Guaranty.
2.8 Real Property Security. Subsidiary Guarantors agree that, if all or
a portion of the Guarantied Obligations are at any time secured by a deed of
trust or mortgage covering interests in real property, Administrative Agent or
its designee, in its sole discretion, without notice or demand and without
affecting the liability of the Subsidiary Guarantors under this Subsidiary
Guaranty, may foreclose, pursuant to the terms of the Loan Documents or
otherwise, on such deed of trust or mortgage and the interests in real property
secured thereby by nonjudicial or other sale. The Subsidiary Guarantors
understand that the exercise by Banks or Administrative Agent, or any of them,
of certain rights and remedies contained in the Credit Agreement and such deed
of trust or mortgage may affect or eliminate Subsidiary Guarantors' right of
subrogation against Borrower and that the Subsidiary Guarantors may therefore
incur a partially or totally nonreimbursable liability hereunder. Nevertheless,
the Subsidiary Guarantors hereby authorize and empower Administrative Agent and
any Bank to exercise, in its sole discretion, any rights and remedies, or any
combination thereof, which may then be available, since it is the intent and
purpose of the Subsidiary Guarantors that the obligations hereunder shall be
absolute, independent and unconditional under any and all circumstances.
Notwithstanding any foreclosure of the lien of such deed of trust or mortgage
with respect to any or all real or personal property secured thereby, whether by
the exercise of the power of sale contained therein, by an action for judicial
foreclosure or by an acceptance of a deed in lieu of foreclosure, the Subsidiary
Guarantors shall remain bound under this Subsidiary Guaranty, including its
obligation to pay any deficiency after a nonjudicial foreclosure.
2.9 Expenses. Subsidiary Guarantors agree to pay, or cause to be paid,
and to save Administrative Agent and Banks harmless against liability for, any
and all costs and expenses (including fees and disbursements of counsel and the
allocated cost of inhouse counsel for the Administrative Agent) incurred or
expended by Administrative Agent or any Bank in connection with the enforcement
of or preservation of any rights under this Subsidiary Guaranty.
2.10 Continuing Guaranty; Termination of Subsidiary Guaranty. This
Subsidiary Guaranty is a continuing guaranty and shall remain in effect until
all of the Guarantied Obligations shall have been indefeasibly paid in full, the
Commitments shall have terminated and
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all Letters of Credit shall have expired or been cancelled or cash
collateralized pursuant to the terms of the Credit Agreement. Anything contained
in this Subsidiary Guaranty to the contrary notwithstanding, this Subsidiary
Guaranty shall not apply to Guarantied Obligations created after actual receipt
by Administrative Agent of written notice (delivered in accordance with Section
5.2) from the Subsidiary Guarantors of its revocation as to future transactions;
provided, however, that any such revocation shall not affect the Subsidiary
Guarantors' liability for any Guarantied Obligations outstanding at the time of
receipt of such notice or any extension or renewal of such Guarantied
Obligations.
2.11 Authority of the Subsidiary Guarantors or Borrower. It is not
necessary for Banks or Administrative Agent to inquire into the capacity or
powers of the Subsidiary Guarantors or Borrower or the officers, directors or
any agents acting or purporting to act on behalf of any of them.
2.12 Financial Condition of Borrower. Any Loans may be granted to
Borrower or continued from time to time without notice to or authorization from
the Subsidiary Guarantors regardless of the financial or other condition of
Borrower at the time of any such grant or continuation. Banks and Administrative
Agent shall have no obligation to disclose or discuss with the Subsidiary
Guarantors their assessment, or the Subsidiary Guarantors' assessments, of the
financial condition of Borrower. Subsidiary Guarantors have adequate means to
obtain information from Borrower on a continuing basis concerning the financial
condition of Borrower and its ability to perform its obligations under the
Credit Agreement, and the Subsidiary Guarantors assume the responsibility for
being and keeping informed of the financial condition of Borrower and of all
circumstances bearing upon the risk of nonpayment of the Guarantied Obligations.
Subsidiary Guarantors hereby waive and relinquish any duty on the part of
Administrative Agent or any Bank to disclose any matter, fact or thing relating
to the business, operations or conditions of Borrower now known or hereafter
known by Administrative Agent or any Bank.
2.13 Rights Cumulative. The rights, powers and remedies given to Banks
and Administrative Agent by this Subsidiary Guaranty are cumulative and shall be
in addition to and independent of all rights, powers and remedies given to Banks
and Administrative Agent by virtue of any statute or rule of law or in any of
the other Loan Documents or any agreement between the Subsidiary Guarantors and
Banks and/or Administrative Agent or between Borrower and Banks and/or
Administrative Agent. Any forbearance or failure to exercise, and any delay by
any Bank or Administrative Agent in exercising, any right, power or remedy
hereunder shall not impair any such right, power or remedy or be construed to be
a waiver thereof, nor shall it preclude the further exercise of any such right,
power or remedy.
2.14 Bankruptcy; Post-Petition Interest; Reinstatement of Subsidiary
Guaranty.
(a) The obligations of the Subsidiary Guarantors under this Subsidiary
Guaranty shall not be reduced, limited, impaired, discharged, deferred,
suspended or terminated by any proceeding, voluntary or involuntary, involving
the bankruptcy, insolvency, receivership, reorganization, liquidation or
arrangement of Borrower or by any defense which Borrower may have by reason of
the order, decree or decision of any court or administrative body resulting from
any such proceeding.
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(b) Subsidiary Guarantors acknowledge and agree that any interest on
any portion of the Guarantied Obligations which accrues after the commencement
of any proceeding referred to in clause (a) above (or, if interest on any
portion of the Guarantied Obligations ceases to accrue by operation of law by
reason of the commencement of said proceeding, such interest as would have
accrued on such portion of the Guarantied Obligations if said proceedings had
not been commenced) shall be included in the Guarantied Obligations because it
is the intention of the Subsidiary Guarantors and Administrative Agent that the
Guarantied Obligations which are guarantied by the Subsidiary Guarantors
pursuant to this Subsidiary Guaranty should be determined without regard to any
rule of law or order which may relieve Borrower of any portion of such
Guarantied Obligations. Subsidiary Guarantors will permit any trustee in
bankruptcy, receiver, debtor in possession, assignee for the benefit of
creditors or similar person to pay Administrative Agent, or allow the claim of
Administrative Agent in respect of, any such interest accruing after the date on
which such proceeding is commenced.
(c) In the event that all or any portion of the Guarantied Obligations
are paid by Borrower, the obligations of the Subsidiary Guarantors hereunder
shall continue and remain in full force and effect or be reinstated, as the case
may be, in the event that all or any part of such payment(s) are rescinded or
recovered directly or indirectly from Administrative Agent or any Bank as a
preference, fraudulent transfer or otherwise, and any such payments which are so
rescinded or recovered shall constitute Guarantied Obligations for all purposes
under this Subsidiary Guaranty.
2.15 Set Off. In addition to any other rights any Bank or
Administrative Agent may have under law or in equity, if any amount shall at any
time be due and owing by the Subsidiary Guarantors to any Bank or Administrative
Agent under this Subsidiary Guaranty, such Bank or Administrative Agent is
authorized at any time or from time to time, without notice (any such notice
being hereby expressly waived), to set off and to appropriate and to apply any
and all deposits (general or special, including but not limited to indebtedness
evidenced by certificates of deposit, whether matured or unmatured) and any
other indebtedness of any Bank or Administrative Agent owing to the Subsidiary
Guarantors and any other property of the Subsidiary Guarantors held by any Bank
or Administrative Agent to or for the credit or the account of the Subsidiary
Guarantors against and on account of the Guarantied Obligations and liabilities
of the Subsidiary Guarantors to any Bank or Administrative Agent under this
Subsidiary Guaranty.
2.16 Discharge of Subsidiary Guaranty Upon Sale of the Subsidiary
Guarantors. If all of the stock of the Subsidiary Guarantors or any of their
successors in interest under this Subsidiary Guaranty shall be sold or otherwise
disposed of (including by merger or consolidation) in an asset sale not
prohibited by the Credit Agreement or otherwise consented to by Requisite Banks,
the Subsidiary Guaranty of the Subsidiary Guarantors or such successor in
interest, as the case may be, hereunder shall automatically be discharged and
released without any further action by Administrative Agent or any Bank or any
other Person effective as of the time of such asset sale. Notwithstanding the
foregoing, so long as the Subsidiary Guarantors or their successor shall remain
a Subsidiary of the Borrower and any Guarantied Obligations remain outstanding,
such the Subsidiary Guarantors or successor shall enter into a new Subsidiary
Guaranty with the Administrative Agent for the benefit of the Banks.
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SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce Banks and Administrative Agent to accept this
Subsidiary Guaranty and to enter into the Credit Agreement and to make the Loans
thereunder, the Subsidiary Guarantors hereby represent and warrant to Banks that
the following statements are true and correct:
3.1 Corporate Existence. Each of the Subsidiary Guarantors is duly
organized, validly existing and in good standing under the laws of the state of
its incorporation, has the corporate power to own its assets and to transact the
business in which it is now engaged and is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership or lease of property or the conduct of its business requires such
qualification, except for failures to be so qualified, authorized or licensed
that would not in the aggregate have a material adverse effect on the business,
operations, assets or financial condition of each respective Subsidiary
Guarantor.
3.2 Corporate Power; Authorization; Enforceable Obligations. Each of
the Subsidiary Guarantors has the corporate power, authority and legal right to
execute, deliver and perform this Subsidiary Guaranty and all obligations
required hereunder and has taken all necessary corporate action to authorize its
Subsidiary Guaranty hereunder on the terms and conditions hereof and its
execution, delivery and performance of this Subsidiary Guaranty and all
obligations required hereunder. No consent of any other Person including,
without limitation, stockholders and creditors of each of the Subsidiary
Guarantors (other than those which have been obtained), and no license, permit,
approval or authorization of, exemption by, notice or report to, or
registration, filing or declaration with, any governmental authority is required
by each of the Subsidiary Guarantors in connection with this Subsidiary Guaranty
or the execution, delivery, performance, validity or enforceability of this
Subsidiary Guaranty and all obligations required hereunder except such consents
licenses, permits, approvals or authorizations which, if not obtained, either
(i) would not adversely affect the ability of each of the Subsidiary Guarantors
to perform the transactions contemplated by this Subsidiary Guaranty, or (ii)
would not have a Material Adverse Effect. This Subsidiary Guaranty has been, and
each instrument or document required hereunder will be, executed and delivered
by a duly authorized officer of each of the Subsidiary Guarantors, and this
Subsidiary Guaranty constitutes, and each instrument or document required
hereunder when executed and delivered hereunder will constitute, the legally
valid and binding obligation of each of the Subsidiary Guarantors, enforceable
against each of the Subsidiary Guarantors in accordance with its terms, except
as enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws or equitable principles
relating to or limiting creditors' rights generally.
3.3 No Legal Bar to this Subsidiary Guaranty. The execution, delivery
and performance of this Subsidiary Guaranty and the documents or instruments
required hereunder, and the use of the proceeds of the borrowings, and the
issuance of the Letters of Credit will not violate any provision of any existing
law or regulation binding on the Subsidiary Guarantors, or any order, judgment,
award or decree of any court, arbitrator or governmental authority binding on
the Subsidiary Guarantors, or the certificate of incorporation or bylaws of each
of the Subsidiary Guarantors or any securities issued by each of the Subsidiary
Guarantors, or any mortgage, indenture, lease, contract or other agreement,
instrument or undertaking to which the
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Subsidiary Guarantors are a party or by which the Subsidiary Guarantors or any
of their assets may be bound, the violation of which would have a material
adverse effect on the business, operations, assets or financial condition of the
Subsidiary Guarantors and will not result in, or require, the creation or
imposition of any Lien on any of their property, assets or revenues pursuant to
the provisions of any such mortgage, indenture, lease, contract or other
agreement, instrument or undertaking.
SECTION 4. AFFIRMATIVE COVENANTS.
So long as any Loan shall remain unpaid or any Bank shall have any
Commitment hereunder and until the expiration, the cancellation and the payment
in full or cash collateralization of all Letters of Credit, the Subsidiary
Guarantors covenant and agree, unless Requisite Banks shall otherwise consent in
writing:
4.1 Corporate Existence, Etc. Except as permitted under Section 5.1 of
the Credit Agreement, the Subsidiary Guarantors shall at all times preserve and
keep in full force and effect its corporate existence and all rights and
franchises material to its business.
4.2 Compliance with Laws, Etc. Subsidiary Guarantors shall perform and
promptly comply with the requirements of all applicable laws, rules, regulations
and orders other than those with which the failure to comply would not have a
Material Adverse Effect, such compliance to include, without limitation, paying
when due all taxes, assessments and governmental charges imposed upon it or upon
any of its properties or assets or in respect of any of its franchises,
businesses, income or property in accordance with Section 6.8 of the Credit
Agreement.
4.3 Books and Records. Subsidiary Guarantors shall keep and maintain
books of record and account with respect to their operations in accordance with
generally accepted accounting principles and shall permit Administrative Agent
or any Bank and their respective officers, employees and authorized agents, to
the extent Administrative Agent in good xxxxx xxxxx necessary for the proper
administration of this Subsidiary Guaranty, to examine, copy and make excerpts
from the books and records of the Subsidiary Guarantors and their Subsidiaries
and to inspect the properties of the Subsidiary Guarantors and their
Subsidiaries, both real and personal, at such reasonable times as Administrative
Agent may request.
SECTION 5. MISCELLANEOUS
5.1 Survival of Warranties. All agreements, representations and
warranties made herein shall survive the execution and delivery of this
Subsidiary Guaranty.
5.2 Notices. Any communications between Administrative Agent and the
Subsidiary Guarantors and any notices or requests provided herein to be given
may be given by mailing the same, postage prepaid, or by telex, facsimile
transmission or cable to each such party at 000 Xxxx Xxx Xxxxxxx Xxxxxxxxx,
Xxxxx 0000, Xxxxxx, Xxxxx 00000, facsimile number (000) 000-0000. Any notice,
request or demand to or upon Administrative Agent or Banks or the Subsidiary
Guarantors shall not be effective until received.
E-12 (Credit Agreement)
127
5.3 Severability. In case any provision in or obligation under this
Subsidiary Guaranty shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.
5.4 Amendments and Waivers. No amendment, modification, termination or
waiver of any provision of this Subsidiary Guaranty, or consent to any departure
by the Subsidiary Guarantors therefrom, shall in any event be effective without
the written concurrence of Requisite Banks under the Credit Agreement; provided,
however, that no amendment, waiver or consent shall, unless in writing and
signed by all Banks change the number of Banks required to take any action
hereunder. Any waiver or consent shall be effective only in the specific
instance and for the specific purpose for which it was given.
5.5 Headings. Section and Section headings in this Subsidiary Guaranty
are included herein for convenience of reference only and shall not constitute a
part of this Subsidiary Guaranty for any other purpose or be given any
substantive effect.
5.6 APPLICABLE LAW. THIS SUBSIDIARY GUARANTY AND THE RIGHTS AND
OBLIGATIONS OF SUBSIDIARY GUARANTORS, ADMINISTRATIVE AGENT AND BANKS HEREUNDER
AND ALL OTHER ASPECTS HEREOF SHALL BE DEEMED TO BE MADE UNDER, SHALL BE GOVERNED
BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF CALIFORNIA APPLICABLE TO CONTRACTS MADE AND PERFORMED IN SUCH STATE.
5.7 Successors and Assigns. This Subsidiary Guaranty is a continuing
guaranty and shall be binding upon the Subsidiary Guarantors and their
successors and assigns. This Subsidiary Guaranty shall inure to the benefit of
Banks, Administrative Agent and their respective successors and assigns.
Subsidiary Guarantors shall not assign this Subsidiary Guaranty or any of the
rights or obligations of the Subsidiary Guarantors hereunder without the prior
written consent of all Banks. Any Bank may, without notice or consent, assign
its interest in this Subsidiary Guaranty in whole or in part in conjunction with
the assignment of its interest in the Guarantied Obligations. The terms and
provisions of this Subsidiary Guaranty shall inure to the benefit of any
assignee or transferee permitted under the Credit Agreement, and in the event of
such transfer or assignment the rights and privileges herein conferred upon
Banks and Administrative Agent shall automatically extend to and be vested in
such transferee or assignee, all subject to the terms and conditions hereof.
5.8 Consent to Jurisdiction; Waiver of Immunities. Subsidiary
Guarantors hereby irrevocably submit to the jurisdiction of any California state
or Federal court sitting in Los Angeles, California, in any action or proceeding
arising out of or relating to this Subsidiary Guaranty, and the Subsidiary
Guarantors hereby irrevocably agree that all claims in respect of such action or
proceeding may be heard and determined in such California state or Federal
court. Subsidiary Guarantors hereby irrevocably waive, to the fullest extent it
may effectively do so, the defense of an inconvenient forum to the maintenance
of such action or proceeding. Subsidiary Guarantors hereby irrevocably appoint
Borrower as its agent to receive, on behalf of the Subsidiary Guarantors and
their property, service of copies of the summons and complaint and
E-13 (Credit Agreement)
128
any other process which may be served in any such action or proceeding. Such
service may be made by mail or by delivering a copy of such process to the
Subsidiary Guarantors in care of the agent named above, and the Subsidiary
Guarantors hereby irrevocably authorize and direct such agent to accept such
service on its behalf. As an alternative method of service, the Subsidiary
Guarantors also irrevocably consent to the service of any and all process in any
such action or proceeding by the mailing of copies of such process to the
Subsidiary Guarantors at their addresses specified in Section 5.2 in accordance
with the procedures for service by mail under California. Subsidiary Guarantors
agree that a final judgment in any such action or proceeding shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by law. Nothing in this Section 5.8 shall affect the right
of any Bank or Administrative Agent to serve legal process in any other manner
permitted by law or affect the right of any Bank or Administrative Agent to
bring any action or proceeding against the Subsidiary Guarantors or their
property in the courts of any other jurisdiction.
5.9 Waiver of Trial by Jury. SUBSIDIARY GUARANTORS AND, BY THEIR
ACCEPTANCE OF THE BENEFITS HEREOF, ADMINISTRATIVE AGENT EACH HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS SUBSIDIARY GUARANTY. The scope of this waiver
is intended to be all-encompassing of any and all disputes that may be filed in
any court and that relate to the subject matter of this transaction, including
without limitation contract claims, tort claims, breach of duty claims and all
other common law and statutory claims. Subsidiary Guarantors and, by their
acceptance of the benefits hereof, Administrative Agent each (i) acknowledges
that this waiver is a material inducement for the Subsidiary Guarantors and
Administrative Agent to enter into a business relationship, that the Subsidiary
Guarantors and Administrative Agent have already relied on this waiver in
entering into this Subsidiary Guaranty or accepting the benefits thereof, as the
case may be, and that each will continue to rely on this waiver in their related
future dealings and (ii) further warrants and represents that each has reviewed
this waiver with its legal counsel, and that each knowingly and voluntarily
waives its jury trial rights following consultation with legal counsel. THIS
WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN
WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS SUBSIDIARY GUARANTY. In the event of
litigation, this Subsidiary Guaranty may be filed as a written consent to a
trial by the court.
5.10 No Other Writing. This writing is intended by Subsidiary
Guarantors and Administrative Agent as the final expression of this Subsidiary
Guaranty and is also intended as a complete and exclusive statement of the terms
of their agreement with respect to the matters covered hereby. No course of
dealing, course of performance or trade usage, and no parole evidence of any
nature, shall be used to supplement or modify any terms of this Subsidiary
Guaranty. There are no conditions to the full effectiveness of this Subsidiary
Guaranty.
5.11 Further Assurances. At any time or from time to time, upon the
request of Administrative Agent or Requisite, Subsidiary Guarantors shall
execute and deliver such further documents and do such other acts and things as
Administrative Agent or Banks may reasonably request in order to effect fully
the purposes of this Subsidiary Guaranty.
E-14 (Credit Agreement)
129
IN WITNESS WHEREOF, Subsidiary Guarantors have executed this Subsidiary
Guaranty by their duly authorized officers as of the date first above written.
By:
---------------------------
Name:
-------------------------
Title:
------------------------
Accepted:
BANK OF AMERICA, N.A., AS
ADMINISTRATIVE AGENT
By:
---------------------------
Name:
-------------------------
Title:
------------------------
E-15 (Credit Agreement)
130
EXHIBIT F
INCREASED COMMITMENT ACCEPTANCE
Dated _____________, 19___
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of October
7, 1999 entered into by and among Flowserve Corporation, a New York corporation
(the "Borrower"), the banks from time to time party thereto, Bank of America,
N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement").
Unless otherwise indicated in this Increased Commitment Acceptance (the
"Acceptance"), the capitalized terms used in this Acceptance shall have the
meanings given to such terms in the Credit Agreement.
1 [INSERT NAME OF BANK] (the "Bank") hereby agrees to increase its
Tranche B Commitment in effect immediately prior to the Effective Date (as
defined below) (the "Current Commitment") by an amount equal TO [INSERT AMOUNT
OF PROPOSED INCREASED COMMITMENT] (the "Proposed Increased Commitment").
2 The effective date for this Acceptance shall be the Increase Date
related to this Acceptance (the "Effective Date"); provided that this Acceptance
has been fully executed and delivered to the Administrative Agent for acceptance
and recording by the Administrative Agent on or prior to such Increase Date.
3 Upon such execution, delivery, acceptance and recording and as of the
Effective Date, the Bank's Tranche B Commitment shall equal the sum of (a) the
Current Commitment plus (b) the Proposed Increased Commitment.
4 Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments under the Credit
Agreement in respect of the Proposed Increased Commitment provided for in this
Acceptance (including, without limitation, all payments of principal, interest
and commitment fees with respect thereto) to the Bank.
5. This Acceptance shall be governed by and construed in accordance
with the laws of the State of California.
F-1 (Credit Agreement)
131
6. This Acceptance may be signed in any number of counterparts, each of
which shall be an original, with the same as if the signatures were upon the
same instrument.
------------------------------
[Bank]
By:
---------------------------
Name:
-------------------------
Title:
------------------------
This Acceptance is hereby acknowledged and
agreed on as of the date set forth above.
BANK OF AMERICA, N.A., AS
ADMINISTRATIVE AGENT
By:
---------------------------
Name:
-------------------------
Title:
------------------------
F-2 (Credit Agreement)
132
EXHIBIT G
NEW COMMITMENT ACCEPTANCE
Dated _____________, 19___
To: Bank of America, N.A., as Administrative Agent
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of October
7, 1999 entered into by and among Flowserve Corporation, a New York corporation
(the "Borrower"), the banks from time to time party thereto, Bank of America,
N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
1. [INSERT NAME OF ACCEPTED BANK] (the "Accepted Bank") agrees to
become a party to the Credit Agreement and to have the rights and perform the
obligations of a Bank under the Credit Agreement, and to be bound in all
respects by the terms of the Credit Agreement.
2. The Accepted Bank hereby agrees to a Tranche B Commitment of [INSERT
AMOUNT OF PROPOSED NEW COMMITMENT] (the "Proposed New Commitment").
3. The Accepted Bank (i) confirms that it has received a copy of the
Credit Agreement, together with copies of the financial statements referred in
Section 5.3 thereof and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Acceptance; (ii) agrees that it will, independently and without reliance upon
the Administrative Agent or any other Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the Credit Agreement;
(iii) confirms that it is an Eligible Assignee; (iv) appoints and authorizes the
Administrative Agent to take such action as Administrative Agent on its behalf
and to exercise such powers under the Credit Agreement as are delegated to the
Administrative Agent by the terms thereof, together with such powers as are
reasonably incidental thereto; (v) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Credit
Agreement are required to be performed by it as a Bank; (vi) specifies as its
Domestic Lending Office (and address for notices) and Eurocurrency Lending
Office the offices set forth beneath its name on the signature page(s) hereof;
and (vii) attaches the declarations, certifications and other documents required
under Section 10.22 of the Credit Agreement as to the Accepted Bank's status for
purposes of determining exemption from withholding taxes with respect to all
payments to be made to the Accepted Bank under the Credit Agreement or to
indicate that all such payments are subject to such rates at a rate reduced by
an applicable tax treaty.
G-1 (Credit Agreement)
133
4. The effective date for this Acceptance shall be the Increase Date
related to this Acceptance (the "Effective Date"); provided that this Acceptance
has been fully executed and delivered to the Administrative Agent for acceptance
and recording by the Administrative Agent on or prior to such Increase Date.
5. Upon such execution, delivery, acceptance and recording and as of
the Effective Date, the Accepted Bank shall be a party to the Credit Agreement
with a Tranche B Commitment equal to the Proposed New Commitment and, to the
extent provided in this Acceptance, have the rights and obligations of a Bank
thereunder.
6. Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments under the Credit
Agreement in respect of the Proposed New Commitment provided for in this
Acceptance (including, without limitation, all payments of principal, interest
and commitment fees with respect thereto) to the Accepted Bank.
7. This Acceptance shall be governed by and construed in accordance
with the laws of the State of California.
G-2 (Credit Agreement)
134
8. This Acceptance may be signed in any number of counterparts, each of
which shall be an original, with the same as if the signatures were upon the
same instrument.
ACCEPTED BANK
------------------------------
By:
---------------------------
Name:
-------------------------
Title:
------------------------
This Acceptance is hereby acknowledged and
agreed on as of the date set forth above.
BANK OF AMERICA, N.A., AS ADMINISTRATIVE AGENT
By:
---------------------------
Name:
-------------------------
Title:
------------------------
LENDING OFFICE AND ADDRESS FOR NOTICES
G-3 (Credit Agreement)
135
EXHIBIT H
FORM OF SUBORDINATION AGREEMENT
SUBORDINATION AGREEMENT ("Agreement") dated [insert date] made by [NAME
OF SUBSIDIARY], a ___________________ corporation (the "Subordinated Creditor"),
and FLOWSERVE CORPORATION, a New York corporation (the "Borrower"), in favor of
the Administrative Agent, the Banks and the Issuing Bank, each as defined in the
Credit Agreement (as defined below).
R E C I T A L S
A. The Borrower has entered into that certain Credit Agreement dated as
of October 7, 1999 entered into by and among Flowserve Corporation, a New York
corporation (the "Borrower"), the banks from time to time party thereto, Bank of
America, N.A., as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent (as extended,
renewed, amended or restated from time to time, the "Credit Agreement;" the
terms defined therein being used herein as therein defined).
B. The Borrower may from time to time become indebted to the
Subordinated Creditor in the ordinary course of its business. All indebtedness
and other obligations of the Borrower to the Subordinated Creditor now or
hereafter existing, interest thereon and any fees, expenses and other amounts
payable are hereinafter referred to as the "Subordinated Debt".
A G R E E M E N T
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
Section 1. Agreement to Subordinate. The Subordinated Creditor, for
itself and its successors and assigns, hereby agrees and covenants that, to the
extent set forth herein and on the terms and conditions set forth herein, the
Subordinated Debt is and shall be subordinate in right of payment to the prior
indefeasible payment in full in cash of all "Obligations" (as defined in the
Credit Agreement) of the Borrower now or hereafter existing under the Credit
Agreement (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. Section
362(a)) (such obligations being the "Obligations").
Section 2. Insolvency. Upon any payment or distribution of assets of
the Borrower or the estate created by the commencement of any Insolvency
Proceeding (defined below), of any kind or character, whether in cash,
securities or other property, the Administrative Agent, the Banks and the
Issuing Bank shall first be entitled to receive payment in full of all
Obligations in cash before the Subordinated Creditor shall be entitled to
receive any payment or distribution on account of the Subordinated Debt.
"Insolvency Proceeding" means any dissolution, winding up, liquidation,
arrangement, reorganization, adjustment, protection, relief or composition of
the Borrower or its debts, whether voluntary or involuntary, in any bankruptcy,
insolvency,
H-1 (Credit Agreement)
136
arrangement, reorganization, receivership, relief or other similar case or
proceeding under any federal or state bankruptcy or similar law or upon an
assignment for the benefit of creditors, any other marshaling of the assets and
liabilities of the Borrower or otherwise.
Upon the occurrence of any proceeding under any Debtor Relief Law
relating to Borrower or any of its Material Subsidiaries, any payment or
distribution of assets or securities of the Borrower of any kind or character,
whether in cash, property or securities to which the Subordinated Creditor would
be entitled, shall be made by the Borrower or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, directly to the Administrative Agent on its behalf and on behalf
of the Banks and the Issuing Bank for application to the payment in full in cash
of all Obligations after giving effect to any concurrent payment or distribution
to the Administrative Agent.
Section 3. Payment of Subordinated Debt. Nothing in this Agreement is
intended to or shall impair, as between the Borrower and the Subordinated
Creditor, the obligation of the Borrower, which is absolute and unconditional,
to pay all principal, interest and other amounts payable with respect to the
Subordinated Debt.
Section 4. Prohibited Payments. The Borrower agrees that it will not
make any payment of any of the Subordinated Debt, or take any other action, in
contravention of the provisions of this Agreement. All payments or distributions
upon or with respect to the Subordinated Debt which are received by the
Subordinated Creditor contrary to the provisions of this Agreement shall be
received in trust for the benefit of the Administrative Agent, the Banks and the
Issuing Bank, shall be segregated from other funds and property held by the
Subordinated Creditor and shall be forthwith paid over to the Administrative
Agent, on its behalf and on behalf of the Banks and the Issuing Bank in the same
form as so received (with any necessary endorsement) to be applied (in the case
of cash) to, or held as collateral (in the case of non-cash property or
securities) for, the payment or prepayment of the Obligations in accordance with
the terms of the Credit Agreement.
Section 5. Amendments, Etc. No amendment or waiver of any provision of
this Agreement, and no consent to any departure by the Subordinated Creditor or
the Borrower herefrom shall in any event be effective unless the same shall be
in writing and signed by the Requisite Banks, and then such waiver or consent
shall be effective only in the specific instance and for the specific purpose
for which given.
Section 6. Expenses. The Subordinated Creditor and the Borrower jointly
and severally agree upon demand to pay to the Administrative Agent, the Banks
and the Issuing Bank the amount of any and all reasonable expenses, including
the reasonable fees and expenses of its counsel (including allocated costs of
inhouse counsel for the Administrative Agent) and of any experts or agents,
which such person may incur in connection with the exercise or enforcement of
any of the rights of such person hereunder or the failure by the Subordinated
Creditor or the Borrower to perform or observe any of the provisions hereof.
Section 7. Addresses for Notices. All notices and other communications
provided for hereunder shall be delivered by Requisite Notice, if to the
Subordinated Creditor, at the address for Borrower provided in the Credit
Agreement; and if to the Borrower, the Administrative
H-2 (Credit Agreement)
137
Agent, any Bank or the Issuing Bank at its address specified in the Credit
Agreement, or as to each party, at such other address as shall be designated by
such party in a written notice to each other party. All such notices and other
communications shall be effective as provided in Section 10.6 of the Credit
Agreement.
Section 8. No Waiver; Remedies. No failure on the part of the
Administrative Agent, the Banks or the Issuing Bank to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof; nor shall any
single or partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
Section 9. Continuing Agreement; Assignments Under the Credit
Agreement. This Agreement is a continuing agreement and shall (i) remain in full
force and effect until the payment in full of the Obligations, (ii) be binding
upon the Subordinated Creditor, the Borrower and their respective successors and
assigns, and (iii) inure to the benefit of, and be enforceable by the
Administrative Agent, the Banks and the Issuing Bank and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing clause (iii) any of the Administrative Agent, the Banks or the Issuing
Bank may assign or otherwise transfer all or any portion of its rights and
obligations under the Credit Agreement to any other person or entity, and such
other person or entity shall thereupon become vested with all rights in respect
thereof granted to such Person herein or otherwise.
Section 10. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California.
Section 11. Waiver of Jury Trial. Each party hereto, and each of the
Administrative Agent, Banks and Issuing Bank by their acceptance of the benefits
hereof, irrevocably waives all right to trial by jury in any action, proceeding
or counterclaim (whether based on contract, tort or otherwise) arising out of or
relating to this Agreement or the transactions contemplated hereby.
H-3 (Credit Agreement)
138
IN WITNESS WHEREOF, the Subordinated Creditor and the Borrower each has
caused this Agreement to be duly executed and delivered by its officer thereunto
duly authorized as of the date first above written.
SUBORDINATED CREDITOR:
------------------------------
By:
---------------------------
Name:
-------------------------
Title:
------------------------
BORROWER
FLOWSERVE CORPORATION
By:
---------------------------
Name:
-------------------------
Title:
------------------------
H-4 (Credit Agreement)
139
EXHIBIT I
OPINION OF COUNSEL
[ ], 1999
To each lender whose name is set forth
on the signature pages of the Credit
Agreement (collectively the "Banks" and
individually, a "Bank"), Bank of
America, N.A., as Administrative Agent
and Issuing Bank, Bank One, Texas, NA,
as Syndication Agent and ABN Amro Bank
N.V., as Documentation Agent.
Ladies and Gentlemen:
I am Senior Associate General Counsel of Flowserve Corporation, a New
York corporation (the "Borrower"), and have represented the Borrower in
connection with the negotiation, execution and delivery of that certain Credit
Agreement dated as of October 7, 1999 entered into by and among Borrower, the
banks from time to time party thereto, Bank of America, N.A., as Administrative
Agent and Issuing Bank, Bank One, Texas, NA, as Syndication Agent and ABN Amro
Bank N.V., as Documentation Agent (the "Credit Agreement;" the terms defined
therein being used herein as therein defined). This opinion is being furnished
to you pursuant to Section 4.1(a)(5) of the Credit Agreement.
I have made such inquiry of such officers of the Borrower and examined
such records, documents, instruments and certificates of public officials and of
the Borrower and considered such questions of law as I have deemed necessary for
the purpose of rendering the opinions set forth herein. I have assumed the
genuineness of all signatures other than those of the Borrower and each Material
Subsidiary and the authenticity of all items submitted to me as originals and
the conformity with originals of all items submitted to me as copies. I am
opining herein as to the effect on the subject transactions of United States
Federal Law, the laws of the State of California and the General Corporation Law
of the State of Delaware.
Based upon and subject to the foregoing, I am of the opinion that:
1. Each of Borrower and the Material Subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and has all requisite corporate power and
authority to own or lease and operate its respective properties and to carry on
its business as now conducted, and to execute and deliver, and to perform all of
its obligations under, any Loan Document to which it is a party, and the
transactions and documents contemplated thereby to which it is a party. Each of
Borrower and the Material Subsidiaries is duly qualified or licensed to do
business as a foreign corporation and in good standing in all jurisdictions in
which it owns or leases assets and property or in which the conduct of its
business requires it to so qualify or be licensed, except where the failure to
so qualify or be licensed would not have a Material Adverse Effect.
I-1 (Credit Agreement)
140
2. The execution, delivery and performance of the Loan Documents by
Borrower and each Material Subsidiary that is a party to a Loan Document, the
payment and performance of all Obligations, and the consummation of the
transactions contemplated by the Loan Documents are within each such entity's
corporate powers, have been duly authorized by all necessary corporate action by
Borrower and each Material Subsidiary which is a party to a Loan Document, do
not contravene (a) Borrower's or such Material Subsidiary's certificate of
incorporation or bylaws, or (b) any law, rule, regulation (including, without
limitation, Regulation U or X of the Board of Governors of the Federal Reserve
System), order, writ, judgment, injunction, decree, determination or award or
any contractual restriction binding on or affecting Borrower or such Material
Subsidiary or any of its respective properties, and do not result in or require
the creation of any lien, security interest or other charge or encumbrance upon
or with respect to any of its properties; neither Borrower nor any Material
Subsidiary is in default under any such law, rule, regulation, order, writ,
judgment, injunction, decree, determination, award or restriction, in any
respect which could reasonably be expected to have a Material Adverse Effect.
3. No approval, consent, exemption, authorization, or other action by,
or notice to, or filing with, any Governmental Authority is necessary or
required in connection with the execution, delivery or performance by, or
enforcement against, Borrower or any Material Subsidiary of any Loan Document
except for routine corporate filings to maintain the corporate good standing of
Borrower and any Material Subsidiary.
4. No authorization, consent, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body is
currently or is reasonably expected to be required on the part of Borrower or
any Material Subsidiary that is a party to a Loan Document for the due
execution, delivery or performance by Borrower or any Material Subsidiary of any
Loan Document, the payment and performance of the Obligations by Borrower or any
Material Subsidiary and the consummation of the transactions contemplated by the
Loan Documents, except such authorizations, consents, approvals, other actions,
notices or filings which, if not obtained, either (a) could not reasonably be
expected to adversely affect the ability of Borrower or any Material Subsidiary
that is a party to a Loan Document to perform the transactions contemplated by
the Loan Documents or (b) could not reasonably be expected to have a Material
Adverse Effect.
5. The Credit Agreement and each other Loan Document have been duly
executed and delivered by Borrower and each Material Subsidiary which is a party
thereto. The Credit Agreement and each other Loan Document and the Obligations
are legally valid and binding obligations of Borrower and each Material
Subsidiary which is a party thereto, enforceable against Borrower or such
Material Subsidiary in accordance with their respective terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or
equitable principles relating to or limiting creditors' rights generally or by
equitable principles relating to enforceability.
6. To my knowledge, no actions, suits, investigations, litigation or
proceedings are pending or threatened against or affecting Borrower or any
Material Subsidiary or the properties of Borrower or any Material Subsidiary
before any court, arbitrator or governmental agency, department, commission,
board, bureau or instrumentality, domestic or foreign, (a) which could
I-2 (Credit Agreement)
141
reasonably be expected to have a Material Adverse Effect or (b) which purport to
affect the legality, validity or enforceability of the Credit Agreement and any
other Loan Document.
7. Borrower is not subject to regulation under the Public Utility
Holding Company Act of 1935, the Federal Power Act, the Interstate Commerce Act
or the Investment Company Act of 1940, each as amended, or to any Federal or
state statute or regulation limiting its ability to incur indebtedness for
borrowed money. No Material Subsidiary is subject to any regulation that would
limit the ability of Borrower to enter into or perform its obligations under the
Credit Agreement.
8. It is not necessary in connection with the execution and delivery of
the Credit Agreement and the Notes to register the Credit Agreement or the Notes
under the Securities Act of 1933, as amended, or to qualify an indenture in
respect thereof under the Trust Indenture Act of 1939, as amended.
This opinion is furnished by me as Senior Associate General Counsel for
Borrower and any Material Subsidiary and may be relied upon by you only in
connection with the Credit Agreement and the other Loan Documents. It may not be
used or relied upon by you for any other purpose or by any other person, nor may
copies be delivered to any other person other than (a) attorneys for and
auditors of the Banks, the Administrative Agent, the Syndication Agent, the
Documentation Agent, (b) governmental officials with regulatory authority with
respect to the business of the Banks and (c) bona fide assignees under the Loan
Documents, without in each instance my prior written consent.
Very truly yours,
I-3 (Credit Agreement)
142
EXHIBIT J
OPINION OF ADMINISTRATIVE AGENT'S COUNSEL
[ ], 1999
Bank of America, N.A.
as Administrative Agent
Agency Management-Los Angeles #20529
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
and
To each of the Banks party to the Credit
Agreement
Re: Credit Agreement dated as of October 7, 1999 entered
into by and among Flowserve Corporation, a New York
corporation (the "Borrower"), each lender whose name
is set forth on the signature pages of the Credit
Agreement (collectively the "Banks" and individually,
a "Bank"), Bank of America, N.A., as Administrative
Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as
Documentation Agent.
Ladies and Gentlemen:
We have acted as counsel to Bank of America, N.A., as
Administrative Agent, in connection with the preparation and delivery of a
Credit Agreement dated as of October 7, 1999 (the "Credit Agreement") entered
into by and among FLOWSERVE CORPORATION, a New York corporation, (the
"Borrower"), each lender whose name is set forth on the signature pages of the
Credit Agreement (collectively, the "Banks" and individually, a "Bank"), Bank of
America, N.A. as Administrative Agent and Issuing Bank, Bank One, Texas, NA, as
Syndication Agent and ABN Amro Bank N.V., as Documentation Agent. Unless
otherwise indicated, capitalized terms used herein but not otherwise defined
herein have the respective meanings set forth in the Credit Agreement.
We have participated in various conferences with
representatives of the Borrower and the Administrative Agent during which the
Credit Agreement and related matters have been discussed. We have reviewed the
forms of the Credit Agreement and the exhibits thereto, including the form of
the promissory notes annexed thereto (the "Notes") and the opinion of Xxxx
Xxxxx, Esq. (the "Opinion") and the officers' certificates and other documents
delivered on
J-1 (Credit Agreement)
143
the date hereof. We have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals or copies and the due
authority of all persons executing the same, and we have relied as to factual
matters on the documents that we have reviewed.
On the basis of the foregoing, we are of the opinion that:
1. The Credit Agreement constitutes the legally valid and
binding obligation of the Borrower, and the Notes constitute the legally valid
and binding obligation of the Borrower enforceable against the Borrower in
accordance with their respective terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws relating to or affecting
creditors' rights generally (including, without limitation, fraudulent
conveyance laws) and by general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair dealing
and the possible unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or at law.
2. The Opinion is satisfactory in form to us and we believe
you are justified in relying thereon.
In giving the opinion in paragraph 1, we have assumed, without
independent investigation, that the Credit Agreement and the Notes have been
duly authorized by all necessary corporate action on the part of the Borrower,
and have been duly executed and delivered by the Borrower, and that the Borrower
is a corporation duly organized, validly existing and in good standing under the
jurisdiction of its incorporation. We understand that you are relying on the
Opinion with respect to such matters.
Our opinion as to the enforceability of the Credit Agreement
is subject to:
(i) public policy considerations, statutes or court decisions
that may limit the rights of a party to obtain indemnification against its own
negligence or willful misconduct; and
(ii) the unenforceability under certain circumstances of
broadly or vaguely stated waivers or waivers of rights granted by law where the
waivers are against public policy or prohibited by law.
We express no opinion with respect to your ability to collect
attorneys' fees and costs in an action involving the Credit Agreement if you are
not the prevailing party in that action (we call your attention to the effect of
Section 1717 of the California Civil Code, which provides that where a contract
permits one party thereto to recover attorneys' fees, the prevailing party in
any action to enforce any provision of the contract shall be entitled to recover
its reasonable attorneys' fees).
We express no opinion as to any provision of the Credit
Agreement requiring written amendments or waivers of the Credit Agreement
insofar as its suggests that oral or other modifications, amendments or waivers
could be effectively agreed upon by the parties or that the doctrine of
promissory estoppel might not apply.
J-2 (Credit Agreement)
144
In addition, we express no opinion as to the effect of
non-compliance by you with any state or federal laws or regulations applicable
to the transactions contemplated by the Credit Agreement because of the nature
of your business.
The law covered by this opinion is limited to present federal
law and the present law of the State of California. We express no opinion as to
the laws of the any other jurisdiction and no opinion regarding the statutes,
administrative decisions, rules, regulations or requirements or any country,
municipality, subdivision or local authority of any jurisdiction.
This opinion is furnished by us as special counsel for the
Administrative Agent and may be relied upon by you only in connection with the
Credit Agreement. It may not be used or relied upon by you for any other purpose
or by any other person, nor may copies be delivered to any other person, without
in each instance our prior written consent other than to attorneys for and
auditors of the Banks, the Administrative Agent, the Syndication Agent, and the
Documentation Agent, to governmental officials with regulatory authority with
respect to the business of the Banks, and to bona fide assignees under the Loan
Documents.
Respectfully submitted
J-3 (Credit Agreement)
145
SCHEDULE 2.1
COMMITMENTS
AND PRO RATA SHARES
ALLOCATIONS FOR FLOWSERVE
TRANCHE A
% OF REVOLVER
BANKS TITLE TOTAL ALLOCATION FACILITIES ALLOCATION
----- ----- ---------------- ---------- ----------
Bank of America Administrative Agent $100,000,000.00 21.73913043% $ 60,000,000.00
Bank One Syndication Agent $100,000,000.00 21.73913043% $ 60,000,000.00
ABN Amro Documentation Agent $ 75,000,000.00 16.30434783% $ 45,000,000.00
BCI Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
BNP Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
BOT-Mitsubishi Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
DG Bank Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
HSBC Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
IBJ Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
National City Participant $ 25,000,000.00 5.43478261% $ 15,000,000.00
Bank Hapoalim Participant $ 10,000,000.00 2.17391304% $ 6,000,000.00
--------------- ------------ ---------------
TOTAL $460,000,000.00 100.00000000% $276,000,000.00
=============== ============ ===============
5-year R/C $276,000,000.00 60.00000000%
364-Day R/C $184,000,000.00 40.00000000%
TRANCHE B % OF
% OF REVOLVER TRANCHE B
BANKS TITLE TRANCHE A REV ALLOCATION REV
----- ----- ------------- ---------- ---------
Bank of America Administrative Agent 21.73913043% $ 40,000,000.00 21.00000000%
Bank One Syndication Agent 21.73913043% $ 40,000,000.00 21.73913043%
ABN Amro Documentation Agent 16.30434783% $ 30,000,000.00 16.30434783%
BCI Participant 5.43478261% $ 10,000,000.00 5.43478261%
BNP Participant 5.43478261% $ 10,000,000.00 5.43478261%
BOT-Mitsubishi Participant 5.43478261% $ 10,000,000.00 5.00000000%
DG Bank Participant 5.43478261% $ 10,000,000.00 5.43478261%
HSBC Participant 5.43478261% $ 10,000,000.00 5.43478261%
IBJ Participant 5.43478261% $ 10,000,000.00 5.43478261%
National City Participant 5.43478261% $ 10,000,000.00 5.00000000%
Bank Hapoalim Participant 2.17391304% $ 4,000,000.00 2.17391304%
------------ --------------- ------------
TOTAL 100.00000000% $184,000,000.00 100.00000000%
============ =============== ============
Schedule 2.1 - 1 (Credit Agreement)
146
SCHEDULE 5.1
SUBSIDIARIES
SUBSIDIARY
Durametallic Australia Holding Co.
Durco B.V. Holland
Flowserve Ahaus GmbH
Flowserve Australia Pty. Ltd.
Flowserve B.V.
Flowserve Coordination Center S.A.
Flowserve de Venezuela S.A.
Flowserve Dichtungtechnik GmbH
Flowserve Dortmund GmbH
Flowserve Dortmund Verwaltungs GmbH
Flowserve Essen GmbH
Flowserve FCD Corporation
Flowserve FSD Corporation
Flowserve FSD N.V.
Flowserve FSD Pty Ltd.
Flowserve Holding, Inc.
Flowserve Inc. (Canada)
Flowserve International B.V.
Flowserve International, Inc.
Flowserve International Ltd.
Flowserve Ireland Limited
Flowserve Japan K.K.
Flowserve Limited (U.K.)
Flowserve Management Company
Flowserve (Mauritius) Corporation
Flowserve New Mexico, Inc.
Flowserve New Zealand Limited
Flowserve Pte Ltd (Singapore)
Flowserve Pty. Ltd
Flowserve RED Corporation
Flowserve RED S.A.
Flowserve S.A. (Argentina)
Flowserve S.A. (Spain)
Flowserve S.A. (Switzerland)
Flowserve S.A. de C.V.
Flowserve S.A.S.
Flowserve Services B.V.
Flowserve Spa
Flowserve SRD S.A.
Valtek South Africa
Schedule 5.1 - 1 (Credit Agreement)
147
SCHEDULE 7.1
EXISTING DEBT, EXISTING LETTERS OF CREDIT
AND SURETY AND PERFORMANCE BONDS OF
BORROWER AND MATERIAL SUBSIDIARIES
------------------------------------------------------------------------------------------------------------------------
SCHEDULE 7.1
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
TOTAL TOTAL SURETY AND
SUBSIDIARY DEBT LC PERFORMANCE
------------------------------------------------------------------------------------------------------------------------
(IN 000'S) (IN 000'S) (IN 000'S)
------------------------------------------------------------------------------------------------------------------------
Durametallic Australia Holding Co.
------------------------------------------------------------------------------------------------------------------------
Durco B.V. Holland
------------------------------------------------------------------------------------------------------------------------
Flowserve Ahaus GmbH
------------------------------------------------------------------------------------------------------------------------
Flowserve Australia Pty. Ltd. 1,500.00
------------------------------------------------------------------------------------------------------------------------
Flowserve B.V. 12,289.98
------------------------------------------------------------------------------------------------------------------------
Flowserve Coordination Center S.A.
------------------------------------------------------------------------------------------------------------------------
Flowserve de Venezuela S.A.
------------------------------------------------------------------------------------------------------------------------
Flowserve Dichtungtechnik GmbH
------------------------------------------------------------------------------------------------------------------------
Flowserve Dortmund GmbH
------------------------------------------------------------------------------------------------------------------------
Flowserve Dortmund Verwaltungs GmbH
------------------------------------------------------------------------------------------------------------------------
Flowserve Essen GmbH
------------------------------------------------------------------------------------------------------------------------
Flowserve FCD Corporation
------------------------------------------------------------------------------------------------------------------------
Flowserve FSD Corporation
------------------------------------------------------------------------------------------------------------------------
Flowserve FSD N.V.
------------------------------------------------------------------------------------------------------------------------
Flowserve FSD Pty Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Holding, Inc. 64,640.25 2,339.96
------------------------------------------------------------------------------------------------------------------------
Flowserve Inc. (Canada)
------------------------------------------------------------------------------------------------------------------------
Flowserve International B.V.
------------------------------------------------------------------------------------------------------------------------
Flowserve International, Inc.
------------------------------------------------------------------------------------------------------------------------
Flowserve International Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Ireland Limited
------------------------------------------------------------------------------------------------------------------------
Flowserve Japan K.K.
------------------------------------------------------------------------------------------------------------------------
Flowserve Limited (U.K.)
------------------------------------------------------------------------------------------------------------------------
Flowserve Management Company
------------------------------------------------------------------------------------------------------------------------
Flowserve (Mauritius) Corporation
------------------------------------------------------------------------------------------------------------------------
Flowserve New Mexico, Inc.
------------------------------------------------------------------------------------------------------------------------
Flowserve New Zealand Limited
------------------------------------------------------------------------------------------------------------------------
Flowserve Pte Ltd (Singapore)
------------------------------------------------------------------------------------------------------------------------
Flowserve Pty. Ltd
------------------------------------------------------------------------------------------------------------------------
Flowserve RED Corporation
------------------------------------------------------------------------------------------------------------------------
Flowserve RED S.A.
------------------------------------------------------------------------------------------------------------------------
Flowserve S.A. (Argentina)
------------------------------------------------------------------------------------------------------------------------
Flowserve S.A. (Spain)
------------------------------------------------------------------------------------------------------------------------
Flowserve S.A. (Switzerland)
------------------------------------------------------------------------------------------------------------------------
Flowserve S.A. de C.V.
------------------------------------------------------------------------------------------------------------------------
Flowserve S.A.S.
------------------------------------------------------------------------------------------------------------------------
Flowserve Services B.V.
------------------------------------------------------------------------------------------------------------------------
Flowserve Spa
------------------------------------------------------------------------------------------------------------------------
Flowserve SRD S.A.
------------------------------------------------------------------------------------------------------------------------
Valtek South Africa
------------------------------------------------------------------------------------------------------------------------
Schedule 7.1 - 1 (Credit Agreement)
148
------------------------------------------------------------------------------------------------------------------------
JOINT VENTURE
------------------------------------------------------------------------------------------------------------------------
Arabian Seals Company Ltd.
------------------------------------------------------------------------------------------------------------------------
Durametallic (India) Ltd.
------------------------------------------------------------------------------------------------------------------------
Ebara-Xxxxx Xxxxxxx, Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Ababsain Co. Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve-XX Xxxxxxxx Services Company Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve India Controls Pvt. Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Ltda
------------------------------------------------------------------------------------------------------------------------
Flowserve Microfinish Pumps Pvt. Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Microfinish Valves Pvt. Ltd.
------------------------------------------------------------------------------------------------------------------------
Flowserve Sdn Bhd
------------------------------------------------------------------------------------------------------------------------
Flowserve Siam Co. Ltd.
------------------------------------------------------------------------------------------------------------------------
Hyosung-Ebara Co. Ltd.
------------------------------------------------------------------------------------------------------------------------
Korea Seal Master Company Ltd.
------------------------------------------------------------------------------------------------------------------------
PT Flowserve
------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------
TOTAL 78,430.23 2,339.96
------------------------------------------------------------------------------------------------------------------------
Schedule 7.1 - 2 (Credit Agreement)
149
SCHEDULE 7.4
EXISTING JOINT VENTURES
FLOWSERVE % OF
JOINT VENTURE JOINT VENTURE
Arabian Seals Company Ltd. 40%
Durametallic (India) Ltd. 40%
Ebara-Xxxxx Xxxxxxx, Ltd. 40%
Flowserve Ababsain Co. Ltd. 60%
Flowserve-XX Xxxxxxxx Services Company Ltd. 40%
Flowserve India Controls Pvt. Ltd. 95%
Flowserve Ltda 99.9%
Flowserve Microfinish Pumps Pvt. Ltd. 76%
Flowserve Microfinish Valves Pvt. Ltd. 76%
Flowserve Sdn Bhd 70%
Flowserve Siam Co. Ltd. 60%
Hyosung-Ebara Co. Ltd. 5%
Korea Seal Master Company Ltd. 40%
PT Flowserve 75%
Schedule 7.4 - 1 (Credit Agreement)
150
SCHEDULE 10.6
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BORROWER
Flowserve Corporation
000 Xxxx Xxx Xxxxxxx Xxxxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Treasurer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
ADMINISTRATIVE AGENT'S OFFICE:
Notices (other than Requests for Extensions of Credit):
Bank of America, N.A., as Administrative Agent
Agency Management-Los Angeles
Mail Code: CA9-706-11-03
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Requests for Extensions of Credit:
Bank of America, N.A.
Agency Administrative Services #5596
Mail Code: CA4-706-05-09
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxx
Assistant Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Account No.: 3750836479
Ref: Flowserve Corporation
Att: Agency Services-West
ABA No. 111 000 012
Schedule 10.6 - 1 (Credit Agreement)
000
XXXX XX XXXXXXX, X.X., AS A BANK
Domestic and Offshore Lending Office:
Agency Administrative Services #5596
Mail Code: CA4-706-05-09
0000 Xxxxxxx Xxxxxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Xxxx
Assistant Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notices (other than Requests for Extensions of Credit):
Bank of America, N.A., as a Bank
Mail Code: CA9-706-11-07
000 Xxxxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxxx
Principal-Sr. Credit Manager
General Corporate West #5618
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANK OF AMERICA, N.A., AS ISSUING BANK
Trade Operations Center - Standby Letters
of Credit #22621
Mail Code: CA9-703-19-23
000 X. Xxxxxxx Xxx., 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxx
Vice President
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANKS:
BANK ONE, TEXAS, NA, AS A BANK
Domestic and Eurodollar Lending Office:
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Schedule 10.6 - 2 (Credit Agreement)
152
Address for Credit Contact:
Attention: Xxxx Xxxxxx
Senior Vice President
0000 Xxxx Xxxxxx, 0xx Xxxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Operations Contact, Bid Contact and Letters of Credit Contact:
Attention: Xxxxxx Xxxxxxxx
000 Xxxxxx Xx
Xx. Xxxxx, XX 00000
TX1-1400
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Legal Counsel:
Attention: Xxxxxxx Xxxxxx
Xxx Xxxx Xxx Xxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Payment Instructions - Lender's Fed Wire and Standby Letters of Credit Fed Wire
Pay to: Bank One, Texas, N.A.
ABA No: 000000000
Dallas TX
Account No: 1065151010
Account Name: Commercial Loan Services Center - South Region
Attention: Special Servicing, Commercial Loan Servicing Center
- South Region
Reference: Flowserve
NATIONAL CITY BANK, AS A BANK
Domestic and Eurodollar Lending Office:
0000 Xxxx Xxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Address for Credit Contact and Draft Documentation Contact:
Attention: Xxxxxxx X. Xxxxxxxxx
Vice President
000 Xxxx Xxxxx St
Mak Loc. 0019
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Schedule 10.6 - 3 (Credit Agreement)
153
Address for Operation Contact and Letters of Credit Contact:
Attention: Xxxxxxx Xxxxxxxxxxx
Manager
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Bid Contact:
Attention: Xxxxxx Djakie
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire and Standby Letters of Credit Fed Wire:
Pay to: National City Bank
ABA No.: 000000000
Xxxxxxxxx, XX 00000
Account No: 151804
Account Name: Commercial Loan Ops
Reference: Flowserve Corp.
ABN AMRO BANK N.V., AS A BANK
Domestic and Eurodollar Lending Office:
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Xxx Xxxxxxx
Credit Administration
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
ABN AMRO Bank N.V.
Three Riverway, Suite 1700
Houston, TX 77056
Attention: Diego Puiggari
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Loan Administration Contact:
Attention: Xxxxxxx Xxxxx
Loan Administration
ABN AMRO BANK N.V.
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Schedule 10.6 - 4 (Credit Agreement)
154
Address for Letter of Credit Contact:
Attention: Xxxx Xxxxxx
Trade Services Department
000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Attention: Diego Puiggari
ABN AMRO Bank N.V.
Xxxxx Xxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Fees, Interest and Loan Repayments:
Pay to: ABN Amro Bank N.V.
New York, NY
ABA No: 000000000
F/O ABN AMRO Bank N.V.
Chicago Branch CPU
Account No: 650-001-1789-41
Reference: Flowserve, Inc.
Payment Instructions - Letters of Credit:
Pay to: ABN Amro Bank N.V.
New York, NY
ABA No: 000000000
F/O ABN AMRO Bank N.V.
Chicago Trade Services CPU
Account No: 653-001-1738-41
Reference: Flowserve, Inc.
THE INDUSTRIAL BANK OF JAPAN, LIMITED, AS A BANK
Domestic and Eurodollar Lending Office:
0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000-0000
Schedule 10.6 - 5 (Credit Agreement)
155
Address for Credit Matters Contact, Compliance Information Contact, and
Execution of Legal Documents Contact:
Attention: Mr. Xxx Xxxxx
Vice President
Three Xxxxx Center
Suite 4850
000 Xxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (713) 651-9444 ext. 103
Facsimile: (000) 000-0000
Address for Operations/Administration Contact:
Attention: Xx. Xxxxxxx Xxxxxx, Vice President OR
Mr. Xxxxxx Xxxxx, Credit Administration
The Industrial Bank of Japan, Limited
New York Branch
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telephone: (000) 000-0000 / 000-0000
Telex No.: 17 55 99/1BJRUT
Telefax No.: (000) 000-0000 / 282-4250
Address for Bid Notices Contact:
Attention: Xxxxxx Xxxxxx
Credit Officer
Three Xxxxx Center
Suite 4850
000 Xxxx Xxxxxx,
Xxxxxxx, XX 00000
Telephone: (713) 651-9444 ext. 103
Telecopier: (000) 000-0000
Payment Instructions - Interest, Principal and Fees:
Pay To: The Industrial Bank of Japan, Limited
New York Branch
ABA No.: 000000000
Reference: Flowserve Corporation
HSBC BANK USA, AS A BANK
Domestic and Eurodollar Lending Office:
000 Xxxxxxxx
Xxx Xxxx, XX 0000-0000
Schedule 10.6 - 6 (Credit Agreement)
156
Address for Business/Credit Contact and Draft Documentation Contact:
Attention: Xxxx Xxxx
Relationship Officer
HSBC Bank USA
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Email Address: xxxxxxx@xxxxxxxxxx.xxx
Address for Administration and Operations Contact, Money Market Bids Contact,
and Letters of Credit Contact
Attention: Xxxxx Xxxxx
Agency Servicing Manager
HSBC Bank USA
0 XXXX Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire:
Bank Name: HSBC Bank USA
ABA No.: 000-000-000
Name on Account: Commercial Loan
Account No.: 000-000-000
Reference: Flowserve Corporation
Attention: Asset Syndication
Payment Instructions - Lender's Standby Letters of Credit Fed Wire:
Bank Name: HSBC Bank USA
ABA No.: 000-000-000
Name on Account: Commercial Loan
Account No.: 000-000-000
Reference: Flowserve Corporation
Attention: Asset Syndication
BANK HAPOALIM B.M. AS A BANK
Domestic and Eurodollar Lending Office:
Bank Hapoalim B.M.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Schedule 10.6 - 7 (Credit Agreement)
157
Address for Credit Contact:
Attention: Xxxxxxxx Xxxxxx
Banking Officer
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Operations Contact and Bid Contact:
Attention: Xxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire and Standby Letters of Credit Fed Wire:
Pay to: Bank of New York
ABA No. 000000000
Account No.: 8023015103
Acct Name: Bank Hapoalim
Attention: Xxxxx Xxxxxxx
THE BANK OF TOKYO - MITSUBISHI, LTD., AS A BANK
Domestic and Eurodollar Lending Office:
0000 Xxxxxxxxx Xx., Xxxxx 0000
Xxxxxxx, XX 00000-0000
Address for Credit Contact:
Attention: Xxxx Xxxxxxx
Vice President
0000 Xxxx Xxx., Xxxxx 0000
Xxxxxx, XX 00000
Telephone: (214) 954-1200 ext. 105
Facsimile: (000) 000-0000
Email Address: xxxxxxxx@xxxxx.xxx
Address for Operations Contact:
Attention: Xxxxx Xxxxx
Administrator
0000 Xxxxxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire and Standby Letters of Credit Fed Wire:
Pay to: The Bank of Tokyo-Mitsubishi, Ltd.
Houston Agency
ABA No.: 0000-0000-0
New York, NY
Account No. 00000000
Reference: Flowserve Corp. Interest, fees, etc.
Schedule 10.6 - 8 (Credit Agreement)
158
BANQUE NATIONALE DE PARIS, AS A BANK
Domestic and Eurodollar Lending Office:
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Address for Credit Contact and Draft Documentation Contact:
Attention: Xxxxx Xxxxxx
Vice President
00000 Xxxxx Xx., Xxxxx 000
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Operations Contact and Bid Contact:
Attention: Xxxxx Xxxx
Vice President
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire:
Pay to: Banque Nationale de Paris, New York Branch
ABA No. 000000000
Account No.: 14101100169
Acct Name: BNP Houston Agency
Attention: Xxxxx Xxxx
BANCA COMMERCIALE ITALIANA, LOS ANGELES FOREIGN BRANCH, AS A BANK
Domestic Lending Office:
000 Xxxxx Xxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Eurodollar Lending Office:
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Schedule 10.6 - 9 (Credit Agreement)
159
Address for Credit Contact, Bid Contact and Draft Documentation Contact:
Attention: Xxxxxxx Xxxxxxxxx
Vice President
Xxx Xxxxxxx Xx., 0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Operations Contact:
Attention: Xxxxxxxx Xxxx
Supervisor
Xxx Xxxxxxx Xx., 0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Letters of Credit Contact:
Attention: Xxxxxxx Xxxxxx
Supervisor
Xxx Xxxxxxx Xx., 0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Address for Legal Counsel:
Attention: Xxx Poster
Attorney
Xxx Xxxxxxx Xx., 0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions - Lender's Fed Wire:
ABA#: 000000000
Account #: BCA Italiana
New York, NY
Account Name: BCI Los Angeles 903700110001
Attention: Loan Department
DG BANK DEUTSCHE GENOSSENSCHAFTSBANK AG, AS A BANK
Address of Domestic and Eurodollar Lending Office:
000 Xxxxx Xxxxxx,
Xxx Xxxx, XX 00000-0000
Schedule 10.6 - 10 (Credit Agreement)
160
Address for Credit Contact and Bid Loan Notices:
Attention: Xxxxx Xxxxxxxx
Assistant Vice President
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Phone: (000) 000-0000
Facsimile: (000) 000-0000/1550
Backup Credit Contact:
Attention: Xxxxxxx Xxxxxxx
Vice President
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Phone: (000) 000-0000
Facsimile: (000) 000-0000/1550
Address for Administrative Contact - Borrowings, Paydowns, Interest, Fees:
Attention: Xx Xxxxx
Assistant Vice President
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Phone: (000) 000-0000
Facsimile: (000) 000-0000
Payment Instructions:
1. DG Bank
via Chips System
DG Bank ABA No. 000000000
2. Federal Reserve Bank of New York
Routing/Account No. 00000000
Schedule 10.6 - 11 (Credit Agreement)
