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EXHIBIT 4.3
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CREDIT AGREEMENT
AMONG
NCI BUILDING SYSTEMS, INC.,
BORROWER
NATIONSBANK OF TEXAS, N.A.,
ADMINISTRATIVE AGENT
NATIONSBANC XXXXXXXXXX SECURITIES LLC,
ARRANGER AND SYNDICATION AGENT
SWISS BANK CORPORATION,
DOCUMENTATION AGENT
AND
THE LENDERS NAMED HEREIN
$600,000,000
MARCH 25, 1998
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TABLE OF CONTENTS
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SECTION 1 DEFINITIONS AND TERMS..........................................1
1.1 Definitions....................................................1
1.2 Number and Gender of Words....................................11
1.3 Accounting Principles.........................................11
SECTION 2 COMMITMENT....................................................12
2.1 Facilities A, B and C.........................................12
2.1.1 Facility A...........................................12
2.1.2 Facility B...........................................12
2.1.3 Facility C...........................................12
2.2 Loan Procedure................................................13
2.3 LC Subfacility................................................13
2.4 Termination of Revolving Facilities...........................16
SECTION 3 TERMS OF PAYMENT..............................................16
3.1 Notes and Payments............................................16
3.2 Interest and Principal Payments...............................16
3.3 Interest Options..............................................19
3.4 Quotation of Rates............................................19
3.5 Default Rate..................................................19
3.6 Interest Recapture............................................19
3.7 Interest Calculations.........................................19
3.8 Maximum Rate..................................................19
3.9 Interest Periods..............................................20
3.10 Conversions...................................................20
3.11 Order of Application..........................................20
3.12 Right of Set-off..............................................21
3.13 Adjustments...................................................21
3.14 Booking Loans.................................................21
3.15 Increased Cost and Reduced Return.............................21
3.16 Limitation on Types of Loans..................................23
3.17 Illegality....................................................23
3.18 Treatment of Affected Loans...................................23
3.19 Compensation..................................................24
3.20 Taxes.........................................................24
3.21 Extensions and Conversions of Facility C Termination Date.....26
3.22 Replacement Lender............................................26
SECTION 4 FEES..........................................................26
4.1 Treatment of Fees.............................................26
4.2 Underwriting and Administrative Fees..........................27
4.3 LC Fees.......................................................27
4.4 Commitment Fee................................................27
(i)
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SECTION 5 SECURITY......................................................27
5.1 Guaranty......................................................27
5.2 Collateral....................................................27
5.3 Additional Security and Guaranties............................27
SECTION 6 CONDITIONS PRECEDENT..........................................28
6.1 General.......................................................28
6.2 Supplements to Schedules......................................28
SECTION 7 REPRESENTATIONS AND WARRANTIES................................29
7.1 Purpose of Credit Facility....................................29
7.2 Corporate Existence, Good Standing, Authority and Compliance..29
7.3 Subsidiaries..................................................29
7.4 Authorization and Contravention...............................29
7.5 Binding Effect................................................29
7.6 Financial Statements; Fiscal Year.............................30
7.7 Litigation....................................................30
7.8 Taxes.........................................................30
7.9 Environmental Matters.........................................30
7.10 Employee Plans................................................31
7.11 Properties; Liens.............................................31
7.12 Location......................................................31
7.13 Government Regulations........................................31
7.14 Transactions with Affiliates..................................31
7.15 Debt..........................................................31
7.16 Material Agreements...........................................31
7.17 Insurance.....................................................31
7.18 Labor Matters.................................................31
7.19 Solvency......................................................32
7.20 Trade Names...................................................32
7.21 Intellectual Property.........................................32
7.22 Full Disclosure...............................................32
7.23 Acquisition...................................................32
SECTION 8 AFFIRMATIVE COVENANTS.........................................33
8.1 Items to be Furnished.........................................33
8.2 Use of Proceeds...............................................34
8.3 Books and Records.............................................34
8.4 Inspections...................................................34
8.5 Taxes.........................................................34
8.6 Payment of Obligations........................................34
8.7 Expenses; Indemnification.....................................34
8.8 Maintenance of Existence, Assets, and Business................35
8.9 Insurance.....................................................36
8.10 Preservation and Protection of Rights.........................36
8.11 Environmental Laws............................................36
(ii)
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8.12 Subsidiaries..................................................36
SECTION 9 NEGATIVE COVENANTS............................................36
9.1 Taxes.........................................................36
9.2 Payment of Obligations........................................36
9.3 Employee Plans................................................36
9.4 Debt..........................................................36
9.5 Liens.........................................................37
9.6 Transactions with Affiliates..................................37
9.7 Compliance with Laws and Documents............................37
9.8 Loans, Advances and Investments...............................37
9.9 Dividends and Distributions...................................38
9.10 Sale of Assets................................................38
9.11 Mergers and Dissolutions......................................38
9.12 Assignment....................................................38
9.13 Fiscal Year and Accounting Methods............................38
9.14 New Businesses................................................38
9.15 Government Regulations........................................38
9.16 Tax Sharing Agreements........................................39
SECTION 10 FINANCIAL COVENANTS...........................................39
10.1 Minimum Net Worth.............................................39
10.2 Maximum Leverage Ratio........................................39
10.3 Maximum Senior Debt Ratio.....................................39
10.4 Minimum Fixed Charge Coverage Ratio...........................40
SECTION 11 DEFAULT.......................................................40
11.1 Payment of Obligation.........................................40
11.2 Covenants.....................................................40
11.3 Debtor Relief.................................................40
11.4 Judgments and Attachments.....................................41
11.5 Government Action.............................................41
11.6 Misrepresentation.............................................41
11.7 Ownership of Other Companies..................................41
11.8 Default Under Other Agreements................................41
11.9 LCs...........................................................41
11.10 Validity and Enforceability of Loan Documents.................41
11.11 Change of Control.............................................41
(iii)
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SECTION 12 RIGHTS AND REMEDIES...........................................42
12.1 Remedies Upon Default.........................................42
12.2 Company Waivers. ............................................42
12.3 Performance by Agent..........................................42
12.4 Not in Control................................................43
12.5 Course of Dealing.............................................43
12.6 Cumulative Rights.............................................43
12.7 Application of Proceeds.......................................43
12.8 Diminution in Value of Collateral.............................43
12.9 Certain Proceedings...........................................43
SECTION 13 AGREEMENT AMONG LENDERS.......................................43
13.1 Appointment, Powers, and Immunities of Agent..................43
13.2 Reliance by Agent.............................................44
13.3 Defaults......................................................44
13.4 Rights as Lender..............................................44
13.5 Indemnification...............................................45
13.6 Non-Reliance on Agent and Other Lenders.......................45
13.7 Resignation of Agent..........................................45
13.8 Relationship of Lenders.......................................45
13.9 Collateral Matters............................................46
13.10 Benefits of Agreement.........................................46
SECTION 14 MISCELLANEOUS.................................................46
14.1 Headings......................................................46
14.2 Nonbusiness Days; Time........................................47
14.3 Communications................................................47
14.4 Form and Number of Documents..................................47
14.5 Exceptions to Covenants.......................................47
14.6 Survival......................................................47
14.7 Governing Law.................................................47
14.8 Invalid Provisions............................................47
14.9 Venue; Service of Process; Jury Trial.........................48
14.10 Amendments, Consents, Conflicts and Waivers...................48
14.11 Multiple Counterparts.........................................49
14.12 Successors and Assigns; Assignments and Participations........49
14.13 Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances.................................................51
14.14 Entirety......................................................51
(iv)
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SCHEDULES AND EXHIBITS
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Schedule 1 Addresses, Commitments and Wiring Information
Schedule 6 Conditions Precedent
Schedule 7.2 Jurisdictions of Incorporation and Business
Schedule 7.3 Corporate Structure
Schedule 7.7 Material Litigation
Schedule 7.9 Environmental Matters
Schedule 7.11 Permitted Liens
Schedule 7.12 Chief Executive Offices
Schedule 7.14 Material Transactions with Affiliates
Schedule 7.15 Permitted Debt
Schedule 7.20 Trade Names
Schedule 9.8 Existing Investments
Exhibit A Facility A Note (Revolving Credit)
Exhibit B Facility B Note (Term Loan)
Exhibit C Facility C Note (364-day Revolving Facility)
Exhibit D Guaranty
Exhibit E Loan Request
Exhibit F Conversion Request
Exhibit G LC Request
Exhibit H Compliance Certificate
Exhibit I Assignment and Acceptance
Exhibit J Pledge Agreement
Exhibit K Assignment of Partnership Interests
Exhibit L Legal Opinion
(v)
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CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of March 25, 1998, among NCI
Building Systems, Inc., a Delaware corporation ("Borrower"), the Lenders
(defined below), NationsBank of Texas, N.A., as Administrative Agent for itself
and the other Lenders ("Agent"), NationsBanc Xxxxxxxxxx Securities LLC, as
Arranger and Syndication Agent, and Swiss Bank Corporation, as Documentation
Agent.
Borrower has requested Lenders to extend credit not to exceed an
aggregate principal amount of $600,000,000, to be allocated as follows:
A. A revolving facility of up to $200,000,000 ("Facility A");
B. A term loan in the principal amount of up to $200,000,000
("Facility B"); and
C. A 364-day revolving facility of up to $200,000,000 ("Facility C").
Lenders are willing to extend the requested credit on the terms and conditions
of this Agreement. Accordingly, the undersigned agree as follows:
SECTION 1 DEFINITIONS AND TERMS.
1.1 Definitions. As used in the Loan Documents:
ACQUISITION means the purchase by Borrower of the stock of Amatek
pursuant to the Purchase Agreement.
ADJUSTED EURODOLLAR RATE means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) determined by Agent to be equal to the sum of (a) the
quotient obtained by dividing (i) the Eurodollar Rate for such Eurodollar Loan
for such Interest Period by (ii) 1 minus the Reserve Requirement for such
Eurodollar Loan for such Interest Period, plus (b) the Applicable Margin.
AFFILIATE of a Person means any other individual or entity who directly
or indirectly controls, or is controlled by, or is under common control with,
that Person. For purposes of this definition, "control," "controlled by," and
"under common control with" mean possession, directly or indirectly, of power to
direct (or cause the direction of) management or policies (whether through
ownership of voting securities, or other ownership interests, by contract, or
otherwise).
AGENT means NationsBank of Texas, N.A., a national banking association,
and its successor or successors as agent for Lenders under this Agreement.
AGREEMENT means this Credit Agreement, as amended, supplemented or
restated from time to time.
AMATEK means Amatek Holdings, Inc., a Texas corporation.
APPLICABLE LENDING OFFICE means, for each Lender and for each Type of
Loan, the "Lending Office" of such Lender (or of an affiliate of such Lender) as
such Lender may from time to time specify to the Agent
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and the Borrower by written notice in accordance with the terms hereof as the
office by which its Loans of such Type are to be made and maintained.
APPLICABLE MARGIN means, on any day, the interest margin over the Base
Rate or the Eurodollar Rate, as the case may be, based on the ratio of Funded
Debt to EBITDA, as follows:
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RATIO OF FUNDED DEBT APPLICABLE APPLICABLE
TO EBITDA MARGIN FOR MARGIN FOR
BASE RATE EURODOLLAR
LOANS LOANS
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Greater than 3.75 to 1.0 0.500% 2.000%
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Less than or equal to 3.75 to 1.0, but greater than 0.250% 1.750%
3.25 to 1.0
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Less than or equal to 3.25 to 1.0, but greater than 0% 1.375%
2.5 to 1.0
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Less than or equal to 2.5 to 1.0, but greater than 0% 1.000%
2.0 to 1.0
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Less than or equal to 2.0 to 1.0 0% 0.750%
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The ratio of Funded Debt to EBITDA is determined from the Current Financials and
any related Compliance Certificate. EBITDA is calculated for the most
recently-completed four fiscal quarters of Borrower (using pro forma combined
information for the Companies and Amatek and its Subsidiaries for any fiscal
period (or portion thereof) of Borrower prior to the Acquisition included in the
calculation) and Funded Debt is calculated as of the last day of such four
fiscal quarter period. The Applicable Margin, as adjusted to reflect such
calculations, shall become effective on the first day following the last day of
the four fiscal quarter period for which such calculation is made,
notwithstanding that Current Financials are delivered, and the calculations are
actually made, at a later date. If Borrower fails to timely furnish to Agent the
Current Financials and any related Compliance Certificate or, if for some other
reason, a new Applicable Margin for a current period cannot be calculated, then
the Applicable Margin in effect on the last day of the last four fiscal quarter
period for which EBITDA was calculated shall remain in effect until a new
Applicable Margin can be calculated, which new Applicable Margin shall become
effective as provided in the immediately preceding sentence. Notwithstanding the
foregoing, the ratio of Funded Debt to EBITDA shall be deemed to be (a) less
than 2.00 to 1.0 until consummation of the Acquisition, and (b) thereafter,
greater than 3.75 to 1.0, in each case, until delivery of Current Financials
(and any related Compliance Certificate) for the fiscal quarter of Borrower
ending July 31, 1998.
APPLICABLE PERCENTAGE means, on any day, the commitment fee percentage
applicable under Section 4 based on the ratio of Funded Debt to EBITDA, as
follows (calculated in accordance with the definition of "Applicable Margin"):
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RATIO OF FUNDED DEBT APPLICABLE
TO EBITDA PERCENTAGE
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Greater than 3.75 to 1.0 0.500%
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Less than or equal to 3.75 to 1.0, but greater than 3.25 to 1.0 0.500%
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Less than or equal to 3.25 to 1.0, but greater than 2.5 to 1.0 0.375%
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Less than or equal to 2.5 to 1.0, but greater than 2.0 to 1.0 0.300%
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Less than or equal to 2.0 to 1.0 0.250%
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ASSIGNMENT OF PARTNERSHIP INTERESTS means an assignment substantially
in the form of EXHIBIT K.
BASE RATE means, for any day, the rate per annum equal to the sum of
(a) the higher of (i) the Federal Funds Rate for such day plus one-half of one
percent (0.5%) and (ii) the Prime Rate for such day. Any change in the Base Rate
due to a change in the Prime Rate or the Federal Funds Rate shall be effective
on the effective date of such change in the Prime Rate or Federal Funds Rate.
BASE RATE LOANS means Loans that bear interest at rates based upon the
Base Rate.
BORROWER is defined in the preamble to this Agreement.
BUSINESS DAY means (a) for all purposes, any day other than Saturday,
Sunday, and any other day that commercial banks are authorized by Law to be
closed in Texas or New York and (b) for purposes of any Eurodollar Loan, a day
that satisfies the requirements of clause (a) and is a day that commercial banks
are open for domestic or international business in London.
CAPITAL LEASE means any capital lease or sublease that has been
capitalized on a balance sheet.
CODE means the Internal Revenue Code of 1986, as amended, and related
rules and regulations.
COLLATERAL is defined in SECTION 5.2.
COMMITMENT USAGE means, at any time, for each Lender, the sum of its
Facility A Commitment Usage, its Facility B Principal Debt, and its Facility C
Principal Debt.
COMMITMENT means the amounts (which are subject to reduction and
cancellation as provided in this Agreement) stated beside a Lender's name for
Facility A, Facility B and Facility C on SCHEDULE 1 as most recently amended
under this Agreement.
COMPANY or COMPANIES means, at any time, Borrower and each of its
Subsidiaries.
COMPLIANCE CERTIFICATE means a certificate substantially in the form of
EXHIBIT H and signed by a Responsible Officer.
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CONTINUE, CONTINUATION, and CONTINUED shall refer to the continuation
pursuant to SECTION 3.9 or SECTIONS 3.15 through 3.19 of a Loan of one Type as a
Loan of the same Type from one Interest Period to the next Interest Period.
CONVERT, CONVERSION, and CONVERTED shall refer to a conversion pursuant
to SECTION 3.10 or Sections 3.15 through 3.19 of one Type of Loan into another
Type of Loan.
CONVERSION REQUEST means a request substantially in the form of EXHIBIT
F.
CURRENT FINANCIALS means, at any time, the consolidated Financial
Statements of Borrower and its Subsidiaries most recently delivered to Agent
under SECTIONS 8.1(a) or 8.1(b), as the case may be.
DEBT means (without duplication), for any Person, (a) all obligations
required by GAAP to be classified upon such Person's balance sheet as
liabilities, (b) liabilities secured (or for which the holder of the Debt has an
existing Right, contingent or otherwise, to be so secured) by any Lien existing
on property owned or acquired by that Person, (c) obligations that have been (or
under GAAP should be) capitalized for financial reporting purposes, and (d) all
guaranties, endorsements and other contingent obligations with respect to
obligations of others of the types described in clauses (a), (b) and (c) above.
DEBTOR RELIEF LAWS means Title 11 of the U.S. Code and all other
applicable state or federal liquidation, conservatorship, bankruptcy,
moratorium, rearrangement, receivership, insolvency, reorganization, suspension
of payments or similar Laws affecting creditors' Rights in effect from time to
time.
DEFAULT is defined in SECTION 11.
DEFAULT RATE means an annual rate of interest equal from day to day to
the lesser of (a) the rate otherwise applicable under this Agreement (or if no
rate is otherwise specified by this Agreement, then the Base Rate plus the
Applicable Margin) plus 2% and (b) the Maximum Rate.
DETERMINING LENDERS means any combination of Lenders holding more than
(a) 51% of the Total Commitments, if no Principal Debt or LC Exposure is
outstanding, or (b) 51% of the Total Commitment Usage if any Principal Debt or
LC Exposure is outstanding.
DISTRIBUTION means, with respect to any shares of any capital stock or
other equity securities or other interests issued by a Person, (a) the
retirement, redemption, purchase or other acquisition for value of those
securities by such Person, (b) the declaration or payment of any dividend on or
with respect to those securities by such Person, (c) any loan or advance by that
Person to, or other investment by that Person in, the holder of any of those
securities, and (d) any other payment by that Person with respect to those
securities.
EBITDA means, in respect of any period, the following (calculated on a
consolidated basis for the Companies in accordance with GAAP): net income before
interest expenses, Taxes, non-cash operating charges (such as depreciation and
amortization expense), non-cash charges in respect of pension and retiree
benefits, and extraordinary gains and losses; provided that, with respect to
Amatek and its Subsidiaries, EBITDA shall include amounts expended for corporate
overhead and executive employee compensation
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during the three fiscal quarters of Amatek preceding the Acquisition and the
fiscal quarter of Amatek in which the Acquisition is consummated.
EMPLOYEE PLAN means an employee pension benefit plan covered by Title
IV of ERISA and established or maintained by any Company.
ENDING CALENDAR MONTH is defined in SECTION 3.9.
ENVIRONMENTAL LAW means any Law that relates to the pollution or
protection of the environment or to Materials of Environmental Concern.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and related rules and regulations.
EURODOLLAR LOANS means Loans that bear interest at rates based upon the
Adjusted Eurodollar Rate.
EURODOLLAR RATE means, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as the
London interbank offered rate for deposits in U.S. dollars at approximately
11:00 a.m. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period. If for any reason
such rate is not available, the term "Eurodollar Rate" shall mean, for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page as the London
interbank offered rate for deposits in U.S. dollars at approximately 11:00 a.m.
(London time) two Business Days prior to the first day of such Interest Period
for a term comparable to such Interest Period; provided, however, that if more
than one rate is specified on Reuters Screen LIBO Page, the applicable rate
shall be the arithmetic mean of all such rates (rounded upwards, if necessary,
to the nearest 1/100 of 1%).
EXISTING BANK DEBT means all obligations of the Companies under the
Credit Agreement dated as of March 12, 1993, as amended.
FACILITIES means Facility A, Facility B and Facility C.
FACILITY A is defined in the preamble to this Agreement.
FACILITY A COMMITMENT means, at any time, the sum of all Commitments
for all Lenders under Facility A (as reduced or canceled under this Agreement)
then in effect.
FACILITY A COMMITMENT USAGE means, at any time, the sum of the Facility
A Principal Debt plus the LC Exposure.
FACILITY A NOTE means a promissory note substantially in the form of
EXHIBIT A.
FACILITY A PRINCIPAL DEBT means, at any time, the unpaid principal
balance of all Loans under Facility A.
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FACILITY A TERMINATION DATE means the earlier of (a) July 1, 2003, and
(b) the effective date that Lenders' commitments to lend under Facility A are
otherwise canceled or terminated in accordance with this Agreement.
FACILITY B is defined in the preamble to this Agreement.
FACILITY B COMMITMENT means, at any time, the sum of all Commitments
for all Lenders under Facility B (as reduced or canceled under this Agreement)
then in effect.
FACILITY B MATURITY DATE means the earlier of (a) July 1, 2003, or (b)
the acceleration of maturity of Facility B in accordance with SECTION 12 of this
Agreement.
FACILITY B NOTE means a promissory note substantially in the form of
EXHIBIT B.
FACILITY B PRINCIPAL DEBT means, at any time, the unpaid principal
balance of all Loans under Facility B.
FACILITY C is defined in the preamble to this Agreement.
FACILITY C COMMITMENT means, at any time, the sum of all Commitments
for all Lenders under Facility C (as reduced or canceled under this Agreement)
then in effect.
FACILITY C NOTE means a promissory note substantially in the form of
EXHIBIT C.
FACILITY C PRINCIPAL DEBT means, at any time, the unpaid principal
balance of all Loans under Facility C.
FACILITY C TERMINATION DATE means, for each Lender, the earlier of (a)
the date 364 days after the date on which the Acquisition is consummated
(subject to extensions and conversions of such Lender's Loans for Facility C
under Section 3.21), but in no event later than July 1, 2003, and (b) the
effective date that Lenders' commitments to lend under Facility C are otherwise
canceled or terminated in accordance with this Agreement.
FEDERAL FUNDS RATE means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted average
of the rates on overnight Federal funds transactions with members of the Federal
Reserve System arranged by Federal funds brokers on such day, as published by
the Federal Reserve Bank of New York on the Business Day next succeeding such
day; provided that (a) if such day is not a Business Day, the Federal Funds Rate
for such day shall be such rate on such transactions on the next preceding
Business Day as so published on the next succeeding Business Day, and (b) if no
such rate is so published on such next succeeding Business Day, the Federal
Funds Rate for such day shall be the average rate charged to Agent (in its
individual capacity) on such day on such transactions as determined by Agent.
FINANCIAL HEDGE means a swap, collar, floor, cap, or other contract
between any Company and any Lender, which is intended to reduce or eliminate the
risk of fluctuations in interest rates and which is legal and enforceable under
applicable Law.
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FINANCIAL STATEMENTS of a Person means balance sheets, profit and loss
statements, reconciliations of capital and surplus, and statements of cash flow
prepared (a) according to GAAP, (b) except as stated in Section 1.3, in
comparative form to prior year-end figures or corresponding periods of the
preceding fiscal year, as applicable, and (c) on a consolidated basis if that
Person had any consolidated Subsidiaries during the applicable period.
FUNDED DEBT means, when determined, the following (calculated on a
consolidated basis for the Companies in accordance with GAAP): (a) all
obligations for borrowed money (whether as a direct obligor on a promissory
note, bond, debenture or other similar instrument, a reimbursement obligor on an
LC or other letter of credit, a guarantor, or otherwise) plus (b) all Capital
Lease obligations.
FUNDING LOSS, means, without duplication, (a) the administrative or
reemployment costs customarily charged by a Lender when (i) Borrower fails or
refuses (for any reason other than such Lender's failure to comply with this
Agreement) to take any Loan that it has requested under this Agreement, or (ii)
Borrower prepays or pays any Loan or Converts any Loan to a Loan of another
Type, in each case, before the last day of the applicable Interest Period, plus
(b) an amount equal to the excess of the amount of interest that would have
accrued on the Loan at the elected interest rate during the remainder of the
applicable Interest Period (but for such failure, refusal, payment, prepayment
or Conversion) over the amount of interest that would accrue on the same Type of
Loan for an interest period of the same duration as the remainder of the
applicable Interest Period.
GAAP means generally accepted accounting principles of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
the Financial Accounting Standards Board that are applicable on the date of this
Agreement.
GUARANTORS means A&S Building Interests, Inc., a Texas corporation
(f/k/a A&S Building Systems, Inc.), A&S Building Systems, L.P., a Texas limited
partnership, NCI Building Systems, L.P., a Texas limited partnership, NCI
Holding Corp., a Delaware corporation, NCI Operating Corp., a Nevada
corporation, and any future domestic Subsidiary of Borrower (including, without
limitation, Amatek and its domestic Subsidiaries upon consummation of the
Acquisition and delivery of Guarantees under Section 8.12).
GUARANTY means a guaranty substantially in the form of EXHIBIT D.
INTEREST PERIOD is determined in accordance with SECTION 3.9.
LAWS means all applicable statutes, laws, treaties, ordinances, rules,
regulations, permits, orders, writs, injunctions, decrees, judgments, opinions
and interpretations of any Tribunal.
LC means a letter of credit (in such form as shall be customary in
respect of obligations of a similar nature) (a) existing on the date hereof and
issued by NationsBank in connection with the Existing Bank Debt, or (b) issued
by Agent under this Agreement and under an LC Agreement.
LC AGREEMENT means a letter of credit application and agreement (in
form and substance satisfactory to Agent) submitted by Borrower to Agent for a
letter of credit for the account of any Company.
LC EXPOSURE means, at any time (without duplication) the sum of (a) the
aggregate undrawn and uncancelled portions of all outstanding LCs plus (b) the
aggregate unpaid reimbursement obligations of
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Borrower under drawings or drafts under any LC, excluding Loans to fund such
reimbursement obligations under SECTION 2.3(c).
LC REQUEST means a request substantially in the form of EXHIBIT G.
LENDER LIENS means Liens in favor of Lenders, or Agent on behalf of
Lenders, securing any of the Obligation.
LENDERS means the financial institutions named on the attached SCHEDULE
1 or on the most recently amended SCHEDULE 1, if any, delivered by Agent under
this Agreement, and, subject to this Agreement, their respective successors and
assigns (but not any Participant who is not otherwise a party to this
Agreement).
LIEN means any lien, mortgage, security interest, pledge, assignment,
charge, title retention agreement or encumbrance of any kind and any other
arrangement for a creditor's claim to be satisfied from assets or proceeds prior
to the claims of other creditors or the owners.
LITIGATION means any action by or before any Tribunal.
LOAN means (without duplication) any amount disbursed by (a) one or
more Lenders to or on behalf of Borrower under the Loan Documents, whether such
amount constitutes an original disbursement of funds, the Continuation of an
amount outstanding under Facility A, Facility B or Facility C, or the financing
of an LC reimbursement obligation under Facility A, or (b) any Lender in
accordance with, and to satisfy the obligations of any Company under, any Loan
Document.
LOAN DATE means for any Loan the date for which funds are requested by
Borrower.
LOAN DOCUMENTS means (a) this Agreement, certificates and reports
delivered under this Agreement, and exhibits and schedules to this Agreement,
(b) the Notes, Guarantees, Security Documents and other agreements, documents
and instruments in favor of Agent or Lenders (or Agent on behalf of Lenders)
ever delivered in connection with or under this Agreement or otherwise delivered
in connection with all or any part of the Obligation (excluding financial
projections), (c) all LCs and LC Agreements, (d) any Financial Hedge between any
Company and any Lender (or any Affiliate of any Lender), and (e) all renewals,
extensions and restatements of, and amendments and supplements to, any of the
foregoing.
LOAN REQUEST means a request substantially in the form of EXHIBIT E.
MATERIAL ADVERSE EVENT means (a) any Default, or (b) any circumstance
or event that, individually or collectively with other circumstances or events,
reasonably is expected to result in any (i) impairment of the ability of
Borrower (individually) or the Companies (as a whole) to perform any payment or
other material obligations under any Loan Document, (ii) impairment of the
ability of Agent or any Lender to enforce (A) any of the material obligations of
Borrower (individually) or the Companies (as a whole) under this Agreement, or
(B) any of their respective material Rights under the Loan Documents, or (iii)
material and adverse effect on the financial condition of Borrower
(individually) or the Companies (as a whole) as represented to Lenders in the
Current Financials.
MATERIAL AGREEMENT means, for any Person, any agreement (excluding
purchase orders for material or inventory in the ordinary course of business) to
which that Person is a party, by which that Person is
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bound, or to which any assets of that Person may be subject, and that is not
cancelable by that Person upon 30 or fewer days' notice without liability for
further payment other than nominal penalty, and that requires that Person to pay
more than $5,000,000 during any 12-month period.
MATERIALS OF ENVIRONMENTAL CONCERN means any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products,
polychlorinated biphenals, urea-formaldehyde insulation, asbestos, pollutants,
contaminants, radioactive materials, and any other substances of any kind,
whether or not such substance is defined as hazardous or toxic under any
Environmental Law, that is regulated pursuant to or could give rise to liability
under any Environmental Law.
MAXIMUM AMOUNT and MAXIMUM RATE respectively mean, for a Lender, the
maximum non-usurious amount and the maximum non-usurious rate of interest that,
under applicable Law, such Lender is permitted to contract for, charge, take,
reserve or receive on the Obligation.
MBCI means Metal Buildings Components, Inc., an indirect wholly-owned
subsidiary of Amatek.
MULTIEMPLOYER PLAN means a multiemployer plan as defined in Sections
3(37) or 4001(a)(3) of ERISA or Section 414(f) of the Code to which any Company
(or any Person that, for purposes of Title IV of ERISA, is a member of
Borrower's controlled group or is under common control with Borrower within the
meaning of Section 414 of the Code) is making, or has made, or is accruing, or
has accrued, an obligation to make contributions.
NATIONSBANK means NationsBank of Texas, N.A.
NET WORTH means, when determined, total assets minus total liabilities
(in each case calculated on a consolidated basis for the Companies in accordance
with GAAP).
NOTES means all outstanding and unpaid Facility A Notes, Facility B
Notes and Facility C Notes.
OBLIGATION means all present and future indebtedness and obligations,
and all renewals, increases and extensions thereof, or any part thereof, now or
hereafter owed to Agent or any Lender by any Company under any Loan Document,
together with all interest accruing thereon, fees, costs and expenses
(including, without limitation, all attorneys' fees and expenses incurred in the
enforcement or collection thereof) payable under the Loan Documents or in
connection with the protection of Rights under the Loan Documents.
OTHER TAXES is defined in SECTION 3.20.
PARTICIPANT is defined in SECTION 14.12(e).
PAYMENT TAXES is defined in SECTION 3.20.
PBGC means the Pension Benefit Guaranty Corporation, or any successor
thereof, established under ERISA.
PERMITTED DEBT means Debt described on Schedule 7.15.
PERMITTED LIENS means Liens described on Schedule 7.11.
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PERSON means any individual, entity or Tribunal.
PLEDGE AGREEMENT means a Pledge Agreement substantially in the form of
EXHIBIT J.
POTENTIAL DEFAULT means the occurrence of any event or the existence of
any circumstance that would, upon notice or lapse of time or both, become a
Default.
PRIME RATE means the per annum rate of interest established from time
to time by NationsBank as its prime rate, which rate may not be the lowest rate
of interest charged by NationsBank to its customers.
PRINCIPAL DEBT means, at any time, the unpaid principal balance of all
Loans.
PRINCIPAL OFFICE means the principal office of NationsBank, presently
located at 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000.
PRO RATA and PRO RATA PART means, when determined for any Lender, (a)
if there is no Principal Debt or LC Exposure, the proportion (stated as a
percentage) that such Lender's Commitment bears to the Total Commitment, or (b)
if there is any Principal Debt or LC Exposure, the proportion (stated as a
percentage) that the sum of (i) the Principal Debt owed to such Lender and (ii)
and (without duplication) the LC Exposure of such Lender, bears to the (x)
aggregate Principal Debt owed to and (y) (without duplication) the LC Exposure
of all Lenders.
PURCHASE AGREEMENT means the Stock Purchase Agreement (and all
schedules and exhibits) between Borrower and BTR Australia Limited, a company
organized under the laws of Australian, and joined in for certain limited
purposes, by BTR plc, dated as of March 25, 1998.
PURCHASER is defined in SECTION 14.12(b).
REGISTER is defined in SECTION 14.12(c).
REPLACEMENT LENDER is defined in SECTION 3.22.
REPRESENTATIVES means representatives, officers, directors, employees,
attorneys and agents.
RESERVE REQUIREMENT means, at any time, the maximum rate at which
reserves (including, without limitation, any marginal, special, supplemental, or
emergency reserves) are required to be maintained under regulations issued from
time to time by the Board of Governors of the Federal Reserve System (or any
successor) by member banks of the Federal Reserve System against "Eurocurrency
liabilities" (as such term is used in Regulation D). Without limiting the effect
of the foregoing, the Reserve Requirement shall reflect any other reserves
required to be maintained by such member banks with respect to (i) any category
of liabilities which includes deposits by reference to which the Adjusted
Eurodollar Rate is to be determined, or (ii) any category of extensions of
credit or other assets which include Eurodollar Loans. The Adjusted Eurodollar
Rate shall be adjusted automatically on and as of the effective date of any
change in the Reserve Requirement.
RESPONSIBLE OFFICER means the chairman, president, chief executive
officer, chief financial officer, chief operating officer, chief accounting
officer, any vice president, controller or treasurer of Borrower.
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RIGHTS means rights, remedies, powers, privileges and benefits.
SCHEDULE means one of the Schedules attached to this Agreement, as
amended or supplemented pursuant to SECTION 6.2.
SECURITY DOCUMENTS means, collectively, the Pledge Agreements, the
Assignments of Partnership Interests, and any other security agreement,
mortgage, deed of trust or other agreement or document, together with all
related financing statements, stock powers, etc., in form and substance
satisfactory to Agent and its legal counsel, executed and delivered by any
Person in connection with this Agreement to create a Lender Lien on any of its
real or personal property, as amended, supplemented or restated.
SENIOR DEBT means, when determined, the Obligation and all other Funded
Debt, except for Debt which is contractually subordinated or junior in right of
payment to the Obligation.
SOLVENT means, as to a Person, that (a) the aggregate fair market value
of its assets exceeds its liabilities, (b) it has sufficient cash flow to enable
it to pay its Debts as they mature, and (c) it does not have unreasonably small
capital to conduct its businesses.
SUBSIDIARY OF ANY PERSON means any entity of which greater than 50% (in
number of votes) of the stock (or equivalent interests) is owned of record or
beneficially, directly or indirectly, by that Person.
TAXES means, for any Person, taxes, assessments or other governmental
charges or levies imposed upon it, its income, or any of its properties,
franchises or assets.
TERMINATION DATE means, as applicable, the Facility A Termination Date,
the Facility B Maturity Date, or the Facility C Termination Date.
TOTAL COMMITMENT means, at any time, the sum of the Facility A
Commitment, the Facility B Commitment, and the Facility C Commitment.
TOTAL COMMITMENT USAGE means, at any time, the sum of the Facility A
Commitment Usage, the Facility B Principal Debt, and the Facility C Principal
Debt.
TRIBUNAL means any (a) local, state or federal judicial, executive, or
legislative instrumentality or agency, (b) private arbitration board or panel,
or (c) central bank.
TYPE means any type of Loan (i.e., a Base Rate Loan or Eurodollar
Loan).
U.S. means United States of America.
1.2 Number and Gender of Words. The singular includes the plural where
appropriate and vice versa, and words of any gender include each other gender
where appropriate.
1.3 Accounting Principles. Under the Loan Documents, unless otherwise
stated, (a) GAAP determines compliance with financial covenants, (b) otherwise,
all accounting principles applied in a current period must be comparable in all
material respects to those applied during the preceding comparable period,
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and (c) while Borrower has any consolidated Subsidiaries, all accounting and
financial terms and compliance with financial covenants must be on a
consolidated basis, as applicable.
SECTION 2 COMMITMENT.
2.1 Facilities A, B and C. Subject to the provisions in the Loan
Documents, each Lender severally and not jointly agrees to lend to Borrower
under Facility A, under Facility B and under Facility C on the following
conditions:
2.1.1 Facility A. Each Lender agrees to lend Borrower its Pro
Rata Part of one or more Loans under Facility A, which Borrower may
borrow, repay and reborrow under this Agreement.
Loans under Facility A are subject to the following conditions:
(a) Each Loan under Facility A must occur on a Business Day
and no later than the Business Day immediately preceding the
Facility A Termination Date;
(b) Each Loan under Facility A must be in an amount not less
than (i) $500,000 or a greater integral multiple of $100,000 (if a
Base Rate Loan), or (ii) $5,000,000 or a greater integral multiple
of $1,000,000 (if a Eurodollar Loan); and
(c) When determined, (i) the Facility A Commitment Usage may
not exceed the Facility A Commitment, (ii) no Lender's Pro Rata
Part of the Facility A Commitment Usage may exceed such Lender's
Commitment for Facility A, and (iii) the Facility A Commitment
Usage, when aggregated with the Facility B Principal Debt and the
Facility C Principal Debt, may not exceed the Total Commitment.
2.1.2 Facility B. Each Lender agrees to lend to Borrower its
Pro Rata Part of a single Loan under Facility B, which, after it has
been prepaid, may not be reborrowed. The Loan under Facility B is
subject to the following conditions:
(a) The Loan under Facility B must occur on or before July 1,
1998;
(b) The Loan must be in an amount equal to the Facility B
Commitment; and
(c) (i) The Facility B Principal Debt may not exceed the
Facility B Commitment; (ii) no Lender's Pro Rata Part of the
Facility B Principal Debt may exceed such Lender's Commitment for
Facility B; and (iii) the Facility B Principal Debt, when
aggregated with the Facility A Commitment Usage and the Facility C
Principal Debt, may not exceed the Total Commitment.
2.1.3 Facility C. Each Lender agrees to lend to Borrower its
Pro Rata Part of one or more Loans under Facility C, which Borrower may
borrow, repay and reborrow under this Agreement.
Loans under Facility C are subject to the following conditions:
(a) Each Loan under Facility C must occur on a Business Day
and no later than the Business Day immediately preceding the
Facility C Termination Date;
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(b) Each Loan under Facility C must be in an amount not less
than (i) $500,000 or a greater integral multiple of $100,000 (if a
Base Rate Loan), or (ii) $5,000,000 or a greater integral multiple
of $1,000,000 (if a Eurodollar Loan); and
(c) When determined, (i) the Facility C Principal Debt may
not exceed the Facility C Commitment, (ii) no Lender's Pro Rata
Part of the Facility C Principal Debt may exceed such Lender's
Commitment for Facility C, and (iii) the Facility C Principal Debt,
when aggregated with the Facility A Commitment Usage and the
Facility B Principal Debt, may not exceed the Total Commitment.
2.2 Loan Procedure. The following procedures apply to Loans:
(a) Borrower may request a Loan by submitting to Agent a Loan
Request. The Loan Request must be received by Agent no later than 12:00
noon on (i) the third Business Day preceding the Loan Date for any
Eurodollar Loan or (ii) the Business Day preceding the Loan Date for
any Base Rate Loan. Agent shall promptly notify each Lender of its
receipt of any Loan Request and its contents. A Loan Request is
irrevocable and binding on Borrower.
(b) By 11:00 a.m. on the applicable Loan Date, each Lender shall
remit its Pro Rata Part of each requested Loan by wire transfer to
Agent pursuant to Agent's wire transfer instructions on SCHEDULE 1 (or
as otherwise directed by Agent) in funds that are available for
immediate use by Agent. Subject to receipt of such funds, Agent shall
make such funds available to Borrower as directed in the Loan Request
(unless it has actual knowledge that any applicable condition precedent
either has not been satisfied by Borrower or has been waived by
Determining Lenders).
(c) Absent contrary written notice from a Lender, Agent may assume
that each Lender has made its Pro Rata Part of the requested Loan
available to Agent on the applicable Loan Date, and Agent may, in
reliance upon such assumption (but is not required to), make available
to Borrower a corresponding amount. If a Lender fails to make its Pro
Rata Part of any requested Loan available to Agent on the applicable
Loan Date, Agent may recover the applicable amount on demand (i) from
that Lender, together with interest at the Federal Funds Rate for the
period commencing on the date the amount was made available to Borrower
by Agent and ending on (but excluding) the date Agent recovers the
amount from that Lender, or (ii), if that Lender fails to pay its
amount upon demand, then from Borrower, together with interest at an
annual interest rate equal to the rate applicable to the requested Loan
for the period commencing on the Loan Date and ending on (but
excluding) the date Agent recovers the amount from Borrower. No Lender
is responsible for the failure of any other Lender to make its Pro Rata
Part of any Loan.
2.3 LC Subfacility.
(a) Subject to the terms and conditions of this Agreement and
applicable Law, Agent agrees to issue LCs under Facility A upon
Borrower's delivery of an LC Request and a duly executed LC Agreement,
each of which must be received by Agent no later than 10:00 a.m. on the
third Business Day before the requested LC is to be issued; provided
that the LC Exposure may not exceed $20,000,000 and the Facility A
Commitment Usage may not exceed the Facility A Commitment. Each LC must
expire no later than the earlier of 30 days before the Facility A
Termination Date and 13 months after such LC's issuance (provided that
LCs may be self-extending with up to 120 days cancellation notice by
Agent to beneficiary).
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(b) Immediately upon Agent's issuance of any LC (and as of the date
of the initial Loan, with respect to existing LCs issued by NationsBank
and included in the Existing Bank Debt), Agent shall be deemed to have
sold and transferred to each other Lender, and each other Lender shall
be deemed irrevocably and unconditionally to have purchased and
received from Agent, without recourse or warranty, an undivided
interest and participation (to the extent of such Lender's Pro Rata
Part of the Facility A Commitment) in the LC and all applicable Rights
of Agent in the LC (other than Rights to receive certain fees provided
for in Section 4.3). Agent agrees to provide a copy of each LC to each
other Lender upon request. However, Agent's failure to send a copy of
an issued LC shall not affect the rights and obligations of Agent and
Lenders under this Agreement.
(c) To induce Agent to issue and maintain LCs, and to induce
Lenders to participate in issued LCs, Borrower agrees to pay or
reimburse Agent (i) within one (1) Business Day after Borrower receives
notice from Agent that any draft or draw request has been properly
presented under any LC, or, if the draft or draw request is for payment
at a future date, within one (1) Business Day before the payment date
specified in the draw request, the amount paid or to be paid by Agent
and (ii) promptly, upon demand, the amount of any additional fees Agent
customarily charges for confirming, negotiating or amending LC
Agreements, for honoring drafts and draw requests, and taking similar
action in connection with letters of credit. Borrower hereby requests
and irrevocably authorizes Agent to fund Borrower's reimbursement
obligations as a Base Rate Loan under Facility A, and the proceeds of
the Facility A Base Rate Loan shall be advanced directly to Agent to
pay Borrower's unpaid reimbursement obligations. If funds cannot be
advanced under Facility A, then Borrower's reimbursement obligation
shall constitute a demand obligation. Borrower's reimbursement
obligations shall accrue interest (x) at the Base Rate plus the
Applicable Margin from the date Agent pays the applicable draft or draw
request through the date Agent is paid or reimbursed by Borrower and,
(y) if funds are not advanced under Facility A, at the Default Rate
from the date Agent pays the applicable draft or draw request through
the date Agent is paid or reimbursed by Borrower. Borrower's
obligations under this Section 2.3(c) are absolute and unconditional
under any and all circumstances and irrespective of any setoff,
counterclaim or defense to payment that Borrower may have at any time
against Agent or any other Person. Agent shall promptly distribute
reimbursement payments received from Borrower to all Lenders according
to their Pro Rata Part of the Facility A Commitment.
(d) Agent shall promptly notify Borrower of the date and amount of
any draft or draw request presented for honor under any LC (but failure
to give notice will not affect Borrower's obligations under this
Agreement). Agent shall pay the requested amount upon presentment of a
draft or draw request unless presentment on its face does not comply
with the terms of the applicable LC. When making payment, Agent may
disregard (i) any default or potential default that exists under any
other agreement and (ii) obligations under any other agreement that
have or have not been performed by the beneficiary or any other Person
(and Agent is not liable for any of those obligations). Borrower's
reimbursement obligations to Agent and Lenders, and each Lender's
obligations to Agent, under this Section 2.3 are absolute and
unconditional irrespective of, (1) the validity, enforceability,
sufficiency, accuracy or genuineness of documents or endorsements (even
if they are in any respect invalid, unenforceable, insufficient,
inaccurate, fraudulent or forged), (2) any dispute by any Company with
or any Company's claims, setoffs, defenses, counterclaims or other
Rights against Agent, any Lender or any other Person, or (3) the
occurrence of any Potential Default or Default.
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(e) If Borrower fails to reimburse Agent as provided in SECTION
2.3(c) and funds are not advanced under Facility A to satisfy the
reimbursement obligations, Agent shall promptly notify each Lender of
Borrower's failure, of the date and amount paid, and of each Lender's
Pro Rata Part of the unreimbursed amount. Each Lender shall promptly
and unconditionally make available to Agent in immediately available
funds its Pro Rata Part of the unpaid reimbursement obligation. Such
funds are due and payable to Agent before the close of business on (i)
the Business Day Agent gives notice to each Lender of Borrower's
reimbursement failure if the notice is received by a Lender before 2:00
p.m. in the time zone where such Lender's Applicable Lending Office is
located, or (ii) on the next succeeding Business Day after the Business
Day Agent gives notice to each Lender of Borrower's reimbursement
failure, if notice is received after 2:00 p.m. in the time zone where
such Lender's Applicable Lending Office is located. All amounts payable
by any Lender accrue interest at the Federal Funds Rate from the day
the applicable draft or draw is paid by Agent to (but not including)
the date the amount is paid by the Lender to Agent.
(f) Borrower acknowledges that each LC is deemed issued upon
delivery to the beneficiary or Borrower. If Borrower requests any LC be
delivered to Borrower rather than the beneficiary, and Borrower
subsequently cancels that LC, Borrower agrees to return it to Agent
together with Borrower's written certification that it has never been
delivered to the beneficiary. If any LC is delivered to the beneficiary
under Borrower's instructions, Borrower's cancellation is ineffective
without Agent's receipt of the LC and the beneficiary's written consent
to the cancellation.
(g) Agent will examine all documents with reasonable care to
ascertain that they appear on their face to be in accordance with the
terms and conditions of the LC. Each Lender and Borrower agree that, in
paying any draft or draw under any LC, Agent has no responsibility to
obtain any document (other than any documents expressly required by the
respective LC) or to ascertain or inquire as to any document's
validity, enforceability, sufficiency, accuracy or genuineness or the
authority of any Person delivering it. Neither Agent nor its
Representatives will be liable to any Lender or any Company for any
LC's use or for any beneficiary's acts or omissions. Any action,
inaction, error, delay or omission taken or suffered by Agent or any of
its Representatives in connection with any LC, applicable draws, drafts
or documents, or the transmission, dispatch or delivery of any related
message or advice, if in conformity with applicable Laws and in
accordance with the standards of care specified in the Uniform Customs
and Practice for Documentary Credits (International Chamber of Commerce
Publication 500), is binding upon the Companies and Lenders. Agent is
not liable to any Company or any Lender for any action taken or omitted
by Agent or its Representative in connection with any LC in the absence
of gross negligence or willful misconduct.
(h) On the Facility A Termination Date, upon a termination under
SECTION 2.4, during the continuance of a Default under SECTION 11.3, or
upon any demand by Agent during the continuance of any other Default,
Borrower shall provide to Agent, for the benefit of Lenders, cash
collateral in an amount equal to the then-existing LC Exposure. Any
cash collateral provided by Borrower to Agent in accordance with this
SECTION 2.3(h) shall be deposited by Agent in an interest bearing cash
collateral account maintained with Agent at the office of Agent and
invested in obligations issued or guaranteed by the U.S. and, upon the
surrender of any LC, Agent shall deliver the appropriate funds on
deposit in such collateral account to Borrower together with interest
accrued on such funds.
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(i) BORROWER SHALL PROTECT, INDEMNIFY, PAY, AND SAVE AGENT, EACH
LENDER AND THEIR RESPECTIVE REPRESENTATIVES HARMLESS FROM AND AGAINST
ANY AND ALL CLAIMS, DEMANDS, LIABILITIES, DAMAGES, LOSSES, COSTS,
CHARGES AND EXPENSES (INCLUDING REASONABLE ATTORNEYS' FEES) WHICH ANY
OF THEM MAY INCUR OR BE SUBJECT TO AS A CONSEQUENCE OF THE ISSUANCE OF
ANY LC, ANY DISPUTE ABOUT IT, ANY CANCELLATION OF ANY LC BY BORROWER,
OR THE FAILURE OF AGENT TO HONOR A DRAFT OR DRAW REQUEST UNDER ANY LC
AS A RESULT OF ANY ACT OR OMISSION (WHETHER RIGHT OR WRONG) OF ANY
PRESENT OR FUTURE TRIBUNAL. HOWEVER, NO PERSON IS ENTITLED TO INDEMNITY
UNDER THE FOREGOING FOR ITS OWN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
(j) Although referenced in any LC, terms of any particular
agreement or other obligation to the beneficiary are not incorporated
into this Agreement in any manner. The fees and other amounts payable
with respect to each LC are as provided in this Agreement, drafts and
draws under each LC are part of the Obligation, and the terms of this
Agreement control any conflict between the terms of this Agreement and
any LC Agreement.
2.4 Termination of Revolving Facilities. Without premium or penalty,
and upon giving at least 10 Business Days prior written and irrevocable notice
to Agent, Borrower may terminate all or part of the unused portion of the
Facility A Commitment or the Facility C Commitment. Each partial termination
must be in an amount of not less than $5,000,000 or a greater integral multiple
of $1,000,000, and shall be Pro Rata among all Lenders. Once all or a portion of
the Facility A Commitment or the Facility C Commitment is terminated, it may not
be increased or reinstated.
SECTION 3 TERMS OF PAYMENT.
3.1 Notes and Payments.
(a) (i) The Facility A Principal Debt shall be evidenced by the
Facility A Notes, one payable to each Lender in the stated
principal amount of its Commitment for Facility A.
(ii) The Facility B Principal Debt shall be evidenced by the
Facility B Notes, one payable to each Lender in the stated
principal amount of its Commitment for Facility B.
(iii) The Facility C Principal Debt shall be evidenced by the
Facility C Notes, one payable to each Lender in the stated
principal amount of its Commitment for Facility C.
(b) Borrower must make each payment and prepayment on the
Obligation, without offset, counterclaim, or deduction, to Agent's
principal office in Dallas, Texas, in funds that will be available for
immediate use by Agent by 12:00 noon on the day due. Payments received
after such time shall be deemed received on the next Business Day.
Agent shall pay to each Lender any payment to which that Lender is
entitled on the same day Agent receives the funds from Borrower, if
Agent receives the payment or prepayment before 12:00 noon, and
otherwise before 12:00 noon on the following Business Day. If and to
the extent that Agent does not make payments to Lenders when due,
unpaid amounts due by Agent to such Lender shall accrue interest at the
Federal Funds Rate from the due date until (but not including) the
payment date.
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3.2 Interest and Principal Payments.
(a) Interest Payments. Accrued interest on each Eurodollar Loan is
due and payable on the last day of its respective Interest Period. If
any Interest Period with respect to a Eurodollar Loan is a period
greater than three months, then accrued interest is also due and
payable on the date three months after the commencement of the Interest
Period. Accrued interest on each Base Rate Loan is due and payable on
the last day of each fiscal quarter of Borrower (commencing July 31,
1998) and on the relevant Termination Date.
(b) Principal Payments.
(i) The Facility A Principal Debt is due and payable on the
Facility A Termination Date.
(ii) Principal payments on the Facility B Principal Debt are
due and payable in quarterly installments commencing October 31,
1998, and continuing on the last day of each fiscal quarter of
Borrower thereafter until the Facility B Maturity Date when the
outstanding Facility B Principal Debt shall be due and payable, as
follows:
October 31, 1998 - $7,500,000 April 30, 2001 - $10,000,000
January 31, 1999 - $7,500,000 July 31, 2001 - $10,000,000
April 30, 1999 - $7,500,000 October 31, 2001 - $11,250,000
July 31, 1999 - $7,500,000 January 31, 2002 - $11,250,000
October 31, 1999 - $8,750,000 April 30, 2002 - $11,250,000
January 31, 2000 - $8,750,000 July 31, 2002 - $11,250,000
April 30, 2000 - $8,750,000 October 31, 2002 - $12,500,000
July 31, 2000 - $8,750,000 January 31, 2003 - $12,500,000
October 31, 2000 - $10,000,000 April 30, 2003 - $12,500,000
January 31, 2001 - $10,000,000 July 1, 2003 - $12,500,000
(iii) The Facility C Principal Debt owed to each Lender is due
and payable on the Facility C Termination Date for such Lender.
(c) Mandatory Prepayment. The Principal Debt is subject to
mandatory prepayment from time to time as follows:
(i) If the Facility A Commitment Usage ever exceeds the
Facility A Commitment, or if the Facility C Principal Debt ever
exceeds the Facility C Commitment, or if the sum of the Facility A
Principal Debt, the Facility B Principal Debt and the Facility C
Principal Debt, together with the LC Exposure, ever exceeds the
Total Commitment, then Borrower shall immediately prepay the
Principal Debt in the amount of that excess.
(ii) Borrower shall prepay the Principal Debt in the amount of
100% of the cash proceeds (after selling expenses and taxes related
thereto to the extent paid and any reserves for retained
liabilities until such liabilities are extinguished) received by
any Company from the disposition of any asset (including proceeds
from the disposition of the stock of Subsidiaries and proceeds
received as a result of any casualty (other than proceeds used by
such Company to repair or replace such casualty in a like-kind
manner) and including
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installment payments under promissory notes or other non-cash
consideration received by any Company for such asset), other than
proceeds of dispositions permitted by SECTIONS 9.10(a), (b), (c),
(d), (e) and (g), within three Business Days after receipt of such
proceeds.
(iii) Borrower shall prepay the Principal Debt in the amount
of 100% of any Funded Debt incurred by any Company after the date
hereof (net of underwriting discounts and commissions and other
costs associated therewith), other than inter-Company Loans and
Capital Lease obligations, simultaneously with the incurrence of
such Debt.
(iv) Borrower shall prepay the Principal Debt in the amount of
100% (if the ratio of Funded Debt, after giving effect to such
prepayment, to EBITDA for the 12-month period ending on the last
day of the immediately preceding month was greater than or equal to
3.50 to 1.00) or 50% (if such ratio was less than 3.50 to 1.00) of
the cash proceeds (net of underwriting discounts and commissions
and other costs associated therewith) received by any Company from
the issuance and sale of equity securities (other than sales of
Borrower's common stock to employees as a result of the exercise of
any options with regard thereto) simultaneous with the receipt of
such proceeds.
Each prepayment under this SECTION 3.2(c) shall be accompanied by
payment of any resulting Funding Loss and all accrued and unpaid
interest on the principal amount prepaid. Subject to the provisions of
SECTION 3.11, mandatory prepayments under this SECTION 3.2(c) shall be
applied in the following order: first to the Facility C Principal Debt
(and a matching reduction of the Facility C Commitment); second to
installments of principal due under Facility B in the inverse order of
maturity; and third to the Facility A Principal Debt (and a matching
reduction of the Facility A Commitment).
(d) Voluntary Prepayment. Borrower may voluntarily repay or
prepay all or any part of the Principal Debt at any time without
premium or penalty, subject to the following conditions:
(i) Agent must receive Borrower's written payment notice by
noon on (A) the third Business Day preceding the date of payment of
a Eurodollar Loan and (B) the Business Day preceding the date of
payment of a Base Rate Loan which shall specify the payment date,
the facility or the subfacility under this Agreement being paid and
the Type and amount of the Loan(s) to be paid, and which shall
constitute an irrevocable and binding obligation of Borrower to
make a repayment or prepayment on the designated date;
(ii) each partial repayment or prepayment must be in a minimum
amount of at least $5,000,000 or a greater integral multiple of
$500,000 (if a Eurodollar Loan) and $500,000 or a greater integral
multiple of $100,000 (if a Base Rate Loan); and
(iii) each prepayment under this SECTION 3.2(d) shall be
accompanied by payment of any resulting Funding Loss and all
accrued and unpaid interest on the principal amount prepaid.
3.3 Interest Options. Except as specifically otherwise provided, Loans
bear interest at an annual rate equal to the lesser of (a) the Base Rate plus
the Applicable Margin or the Eurodollar Rate plus the Applicable Margin (in each
case as designated or deemed designated by Borrower and, in the case of
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Eurodollar Loans, for the Interest Period designated by Borrower), as the case
may be, and (b) the Maximum Rate. Each change in the Base Rate and Maximum Rate
is effective, without notice to Borrower or any other Person, upon the date of
change.
3.4 Quotation of Rates. A Responsible Officer of Borrower may call
Agent before delivering a Loan Request to receive an indication of the interest
rates then in effect, but the indicated rates do not bind Agent or Lenders or
affect the interest rate that is actually in effect when Borrower delivers its
Loan Request or on the Loan Date.
3.5 Default Rate. If permitted by Law, all past-due Principal Debt,
Borrower's past-due payment and reimbursement obligations in connection with
LCs, and past-due interest accruing on any of the foregoing, bears interest from
the date due (stated or by acceleration) at the Default Rate until paid,
regardless whether payment is made before or after entry of a judgment.
3.6 Interest Recapture. If the designated interest rate applicable to
any Loan exceeds the Maximum Rate, the interest rate on that Loan is limited to
the Maximum Rate, but any subsequent reductions in the designated rate shall not
reduce the interest rate thereon below the Maximum Rate until the total amount
of accrued interest equals the amount of interest that would have accrued if
that designated rate had always been in effect. If at maturity (stated or by
acceleration), or at final payment of the Notes, the total interest paid or
accrued is less than the interest that would have accrued if the designated
rates had always been in effect, then, at that time and to the extent permitted
by applicable Law, Borrower shall pay an amount equal to the difference between
(a) the lesser of the amount of interest that would have accrued if the
designated rates had always been in effect and the amount of interest that would
have accrued if the Maximum Rate had always been in effect, and (b) the amount
of interest actually paid or accrued on the Notes.
3.7 Interest Calculations.
(a) Interest will be calculated on the basis of actual number
of days elapsed (including the first day but excluding the last day)
but computed as if each calendar year consisted of 360 days for
Eurodollar Loans (unless the calculation would result in an interest
rate greater than the Maximum Rate, in which event interest will be
calculated on the basis of a year of 365 or 366 days, as the case may
be), and 365 or 366 days, as the case may be, for Base Rate Loans. All
interest rate determinations and calculations by Agent are conclusive
and binding absent manifest error.
(b) The provisions of this Agreement relating to calculation
of the Base Rate and the Eurodollar Rate are included only for the
purpose of determining the rate of interest or other amounts to be paid
under this Agreement that are based upon those rates. Each Lender may
fund and maintain its funding of all or any part of each Loan as it
selects.
3.8 Maximum Rate. Regardless of any provision contained in any Loan
Document or any document related thereto, it is the intent of the parties to
this Agreement that neither Agent nor any Lender contract for, charge, take,
reserve, receive or apply, as interest on all or any part of the Obligation any
amount in excess of the Maximum Rate or the Maximum Amount or receive any
unearned interest in violation of any applicable Law, and, if Lenders ever do
so, then any excess shall be treated as a partial repayment or prepayment of
principal and any remaining excess shall be refunded to Borrower. In determining
if the interest paid or payable exceeds the Maximum Rate, Borrower and Lenders
shall, to the maximum extent permitted under applicable Law, (a) treat all Loans
as but a single extension of credit (and Lenders and
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Borrower agree that is the case and that provision in this Agreement for
multiple Loans is for convenience only), (b) characterize any nonprincipal
payment as an expense, fee or premium rather than as interest, (c) exclude
voluntary repayments or prepayments and their effects, and (d) amortize,
prorate, allocate and spread the total amount of interest throughout the entire
contemplated term of the Obligation. However, if the Obligation is paid in full
before the end of its full contemplated term, and if the interest received for
its actual period of existence exceeds the Maximum Amount, Lenders shall refund
any excess (and Lenders may not, to the extent permitted by Law, be subject to
any penalties provided by any Laws for contracting for, charging, taking,
reserving or receiving interest in excess of the Maximum Amount). If the Laws of
the State of Texas are applicable for purposes of determining the "Maximum Rate"
or the "Maximum Amount," then such terms refer to the "revised ceiling or
bracket" from time to time in effect under V.T.C.A., Finance Code Section 1.001
et seq (West 1997). Borrower agrees that V.T.C.A., Finance Code Chapter 346
(which regulates certain revolving credit loan accounts and revolving tri-party
accounts), does not apply to the Obligation, other than Section 346.004.
3.9 Interest Periods. When Borrower requests any Eurodollar Loan,
Borrower may elect the applicable interest period (each an "INTEREST PERIOD"),
which may be, at Borrower's option, and one, two, three or six months for
Eurodollar Loans, subject to the following conditions: (a) the initial Interest
Period for a Eurodollar Loan commences on the applicable Loan Date or Conversion
date, and each subsequent Interest Period applicable to any Loan commences on
the day when the next preceding applicable Interest Period expires; (b) if any
Interest Period for a Eurodollar Loan begins on a day for which there exists no
numerically corresponding Business Day in the calendar month at the end of the
Interest Period ("ENDING CALENDAR MONTH"), then the Interest Period ends on the
next succeeding Business Day of the Ending Calendar Month, unless there is no
succeeding Business Day in the Ending Calendar Month in which case the Interest
Period ends on the next preceding Business Day of the Ending Calendar Month; (c)
no Interest Period for any portion of Principal Debt may extend beyond the
scheduled repayment date for that portion of Principal Debt; and (d) there may
not be in effect at any one time more than (i) 10 Interest Periods for the
Eurodollar Loan portion of Facility A, (ii) one Interest Period for the
Eurodollar Loan portion of Facility B, and (iii) 10 Interest Periods for the
Eurodollar Loan portion of Facility C.
3.10 Conversions. Borrower may (a) on the last day of the applicable
Interest Period Convert all or part of a Eurodollar Loan to a Base Rate Loan,
(b) at any time Convert all or part of a Base Rate Loan to a Eurodollar Loan,
and (c) elect a new Interest Period for a Eurodollar Loan. Any such Conversion
is subject to the dollar limits and denominations of SECTION 2.1 and may be
accomplished by delivering a Conversion Request to Agent no later than 10:00
a.m. (i) on the third Business Day before the Conversion date for Conversion to
a Eurodollar Loan and the last day of the Interest Period, for the election of a
new Interest Period, and (ii) one Business Day before the last day of the
Interest Period for Conversion to a Base Rate Loan. Absent Borrower's notice of
Conversion or election of a new Interest Period, a Eurodollar Loan shall be
Converted to a Base Rate Loan when the applicable Interest Period expires.
3.11 Order of Application.
(a) If no Default or Potential Default exists, any payment
shall be applied to the Obligation in the order and manner as provided
in this Agreement.
(b) If a Default or Potential Default exists, any payment
(including proceeds from the exercise of any Rights) shall be applied
in the following order: (i) to all fees and expenses for which Agent or
Lenders have not been paid or reimbursed in accordance with the Loan
Documents (and if such payment is less than all unpaid or unreimbursed
fees and expenses, then the payment shall
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be paid against unpaid and unreimbursed fees and expenses in the order
of incurrence or due date); (ii) to accrued interest on the Principal
Debt; (iii) to any LC reimbursement obligations that are due and
payable and that remain unfunded by any Loan under Facility A; (iv) to
the remaining Obligation in the order and manner Determining Lenders
deem appropriate; and (v) as a deposit with Agent, for the benefit of
Lenders, as security for and payment of any subsequent LC reimbursement
obligations.
3.12 Right of Set-off. Upon the occurrence and during the continuance
of any Default, each Lender (and each of its Affiliates) is hereby authorized at
any time and from time to time, to the fullest extent permitted by Law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by such Lender (or any of its Affiliates) to or for the credit or the account of
Borrower against any and all of the obligations of Borrower now or hereafter
existing under this Agreement and any Note held by such Lender, irrespective of
whether such Lender shall have made any demand under this Agreement or such Note
and although such obligations may be unmatured. Each Lender agrees promptly to
notify Borrower after any such set-off and application made by such Lender;
provided, however, that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each Lender under this
SECTION 3.12 are in addition to other rights and remedies (including, without
limitation, other rights of set-off) that such Lender may have.
3.13 Adjustments. If any Lender (a "BENEFITTED LENDER") shall at any
time receive any payment of all or part of the Loans owing to it, or interest
thereon, or receive any Collateral in respect thereof (whether voluntarily or
involuntarily, by set-off, or otherwise), in a greater proportion than any such
payment to or Collateral received by any other Lender, if any, in respect of
such other Lender's Loans owing to it, or interest thereon, such benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Loans owing to it, or shall provide
such other Lenders with the benefits of any such Collateral, or the proceeds
thereof, as shall be necessary to cause such benefitted Lender to share the
excess payment or benefits of such Collateral or proceeds ratably with each of
the Lenders; provided, however, that if all or any portion of such excess
payment or benefits is thereafter recovered from such benefitted Lender, such
purchase shall be rescinded, and the purchase price and benefits returned, to
the extent of such recovery, but without interest. Borrower agrees that any
Lender so purchasing a participation from a Lender pursuant to this SECTION 3.13
may, to the fullest extent permitted by Law, exercise all of its rights of
payment (including the right of set-off) with respect to such participation as
fully as if such Person were the direct creditor of Borrower in the amount of
such participation.
3.14 Booking Loans. To the extent permitted by Law, any Lender may
make, carry or transfer its Loans at, to, or for the account of any of its
branch offices or the office of any of its Affiliates. However, no Affiliate is
entitled to receive any greater payment under SECTION 3.15 than the transferor
Lender would have been entitled to receive with respect to those Loans.
3.15 Increased Cost and Reduced Return.
(a) If, after the date hereof, the adoption of any applicable
Law, or any change in any applicable Law, or any change in the
interpretation or administration thereof by any Tribunal charged with
the interpretation or administration thereof, or compliance by any
Lender (or its Applicable Lending Office) with any request or directive
(whether or not having the force of law) of any such Tribunal:
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(i) shall subject such Lender (or its Applicable Lending
Office) to any tax, duty, or other charge with respect to any
Eurodollar Loan, or any Note, or its obligation to make Eurodollar
Loans, or change the basis of taxation of any amounts payable to
such Lender (or its Applicable Lending Office) under this
Agreement or any Note in respect of any Eurodollar Loans (other
than Taxes imposed on the overall net income of such Lender by the
jurisdiction in which such Lender has its principal office or such
Applicable Lending Office);
(ii) shall impose, modify, or deem applicable any reserve,
special deposit, assessment, or similar requirement (other than
the Reserve Requirement utilized in the determination of the
Adjusted Eurodollar Rate) relating to any extensions of credit or
other assets of, or any deposits with or other liabilities or
commitments of, such Lender (or its Applicable Lending Office),
including the Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable Lending
Office) or on the London interbank market any other condition
affecting this Agreement or any Note or any of such extensions of
credit or liabilities or commitments;
and the result of any of the foregoing is to increase the cost to such
Lender (or its Applicable Lending Office) of making, Converting into,
Continuing, or maintaining any Eurodollar Loan or to reduce any sum
received or receivable by such Lender (or its Applicable Lending
Office) under this Agreement or any Note with respect to any Eurodollar
Loan, then Borrower shall pay to such Lender on demand such amount or
amounts as will compensate such Lender for any such increased cost or
reduction incurred not more than 180 days prior to such demand. If any
Lender requests compensation by Borrower under this SECTION 3.15(a),
Borrower may, by notice to such Lender (with a copy to Agent), suspend
the obligation of such Lender to make or Continue Loans of the Type
with respect to which such compensation is requested, or to Convert
Loans of any other Type into Loans of such Type, until the event or
condition giving rise to such request ceases to be in effect (in which
case the provisions of SECTION 3.18 shall be applicable); provided that
such suspension shall not affect the right of such Lender to receive
the compensation so requested.
(b) If, after the date hereof, any Lender shall have determined
that the adoption of any applicable Law regarding capital adequacy or
any change therein or in the interpretation or administration thereof
by any Tribunal charged with the interpretation or administration
thereof, or any request or directive regarding capital adequacy
(whether or not having the force of law) of any such Tribunal, has or
would have the effect of reducing the rate of return on the capital of
such Lender or any corporation controlling such Lender as a consequence
of such Lender's obligations hereunder to a level below that which such
Lender or such corporation could have achieved but for such adoption,
change, request, or directive (taking into consideration its policies
with respect to capital adequacy), then from time to time upon demand
Borrower shall pay to such Lender such additional amount or amounts as
will compensate such Lender for any such reduction incurred not more
than 180 days prior to such demand.
(c) Each Lender shall promptly notify Borrower and Agent of any
event of which it has knowledge, occurring after the date hereof, which
will entitle such Lender to compensation pursuant to this SECTION 3.15
and will designate a different Applicable Lending Office if such
designation will avoid the need for, or reduce the amount of, such
compensation and will not, in the judgment of such Lender, be otherwise
disadvantageous to it. Any Lender claiming compensation under this
Section
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shall furnish to Borrower and Agent a statement setting forth the
additional amount or amounts to be paid to it hereunder which shall be
conclusive in the absence of manifest error. In determining such
amount, such Lender may use any reasonable averaging and attribution
methods.
3.16 Limitation on Types of Loans. If on or prior to the first day of
any Interest Period for any Eurodollar Loan:
(a) Agent determines (which determination shall be conclusive)
that by reason of circumstances affecting the relevant market, adequate
and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period; or
(b) Determining Lenders determine (which determination shall
be conclusive) and notify Agent that the Adjusted Eurodollar Rate will
not adequately and fairly reflect the cost to Lenders of funding
Eurodollar Loans for such Interest Period;
then Agent shall give Borrower prompt notice thereof specifying the relevant
Type of Loans and the relevant amounts or periods, and so long as such condition
remains in effect, Lenders shall be under no obligation to make additional Loans
of such Type, Continue Loans of such Type, or to Convert Loans of any other Type
into such Type and Borrower shall, on the last day(s) of the then current
Interest Period(s) for the outstanding Loans of the affected Type, either prepay
them or Convert them into another Type in accordance with the terms of this
Agreement.
3.17 Illegality. Notwithstanding any other provision of this Agreement,
in the event that it becomes unlawful for any Lender or its Applicable Lending
Office to make, maintain, or fund Eurodollar Loans hereunder, then such Lender
shall promptly notify Borrower thereof and such Lender's obligation to make or
Continue Eurodollar Loans and to Convert other Types of Loans into Eurodollar
Loans shall be suspended until such time as such Lender may again make,
maintain, and fund Eurodollar Loans (in which case the provisions of SECTION
3.18 shall be applicable).
3.18 Treatment of Affected Loans. If the obligation of any Lender to
make a particular Type of Loan or to Continue, or to Convert Loans of any other
Type into, Loans of a particular Type shall be suspended pursuant to SECTION
3.15 or 3.17 (Loans of such Type being herein called "AFFECTED LOANS" and such
Type being herein called the "AFFECTED TYPE"), such Lender's Affected Loans
shall be automatically Converted into Base Rate Loans on the last day(s) of the
then current Interest Period(s) for Affected Loans (or, in the case of a
Conversion required by SECTION 3.17, on such earlier date as such Lender may
specify to Borrower with a copy to Agent) and, unless and until such Lender
gives notice as provided below that the circumstances specified in SECTION 3.15
or 3.17 that gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Affected Loans have been
so Converted, all payments and prepayments of principal that would
otherwise be applied to such Lender's Affected Loans shall be applied
instead to its Base Rate Loans; and
(b) all Loans that would otherwise be made or Continued by
such Lender as Loans of the Affected Type shall be made or Continued
instead as Base Rate Loans, and all Loans of such Lender that would
otherwise be Converted into Loans of the Affected Type shall be
Converted instead into (or shall remain as) Base Rate Loans.
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If such Lender gives notice to Borrower (with a copy to the Agent) that the
circumstances specified in SECTION 3.15 or 3.17 that gave rise to the Conversion
of such Lender's Affected Loans pursuant to this SECTION 3.18 no longer exist
(which such Lender agrees to do promptly upon such circumstances ceasing to
exist) at a time when Loans of the Affected Type made by other Lenders are
outstanding, such Lender's Base Rate Loans shall be automatically Converted, on
the first day(s) of the next succeeding Interest Period(s) for such outstanding
Loans of the Affected Type, to the extent necessary so that, after giving effect
thereto, all Loans held by Lenders holding Loans of the Affected Type and by
such Lender are held pro rata (as to principal amounts, Types, and Interest
Periods) in accordance with their respective Commitments.
3.19 Compensation. Upon the request of any Lender, Borrower shall pay
to such Lender such amount or amounts as shall be sufficient (in the reasonable
opinion of such Lender) to compensate it for any loss, cost, or expense
(including loss of anticipated profits) incurred by it as a result of:
(a) any payment, prepayment, Conversion of a Eurodollar Loan
for any reason (including, without limitation, the acceleration of the
Loans pursuant to SECTION 12 or any syndication of one or more of the
Facilities, if such syndication occurs on or before December 31, 1998)
on a date other than the last day of the Interest Period for such Loan;
or
(b) any failure by Borrower for any reason (including, without
limitation, the failure of any condition precedent specified in SECTION
6 to be satisfied) to borrow, Convert, Continue, or prepay a Eurodollar
Loan on the date for such borrowing, Conversion, Continuation, or
prepayment specified in the relevant notice of borrowing, prepayment,
Continuation, or Conversion under this Agreement.
3.20 Taxes.
(a) Any and all payments by Borrower to or for the account of
any Lender or Agent hereunder or under any other Loan Document shall be
made free and clear of and without deduction for any and all present or
future Taxes, duties, levies, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto, excluding, in
the case of each Lender and Agent, Taxes imposed on its income, and
franchise taxes imposed on it, by the jurisdiction under the laws of
which such Lender (or its Applicable Lending Office) or Agent (as the
case may be) is organized or any political subdivision thereof (all
such non-excluded Taxes, duties, levies, imposts, deductions, charges,
withholdings, and liabilities being hereinafter referred to as "PAYMENT
TAXES"). If Borrower shall be required by law to deduct any Payment
Taxes from or in respect of any sum payable under this Agreement or any
other Loan Document to any Lender or Agent, (i) the sum payable shall
be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
SECTION 3.20) such Lender or Agent receives an amount equal to the sum
it would have received had no such deductions been made, (ii) Borrower
shall make such deductions, (iii) Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in
accordance with applicable Law, and (iv) Borrower shall furnish to
Agent, at its address referred to in SECTION 14.3, the original or a
certified copy of a receipt evidencing payment thereof.
(b) In addition, Borrower agrees to pay any and all present or
future stamp or documentary taxes and any other excise or property
taxes or charges or similar levies which arise from any payment made
under any Loan Document or from the execution or delivery of, or
otherwise with respect to, any Loan Document (hereinafter referred to
as "OTHER TAXES").
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(c) BORROWER AGREES TO INDEMNIFY EACH LENDER AND AGENT FOR THE
FULL AMOUNT OF PAYMENT TAXES AND OTHER TAXES (INCLUDING, WITHOUT
LIMITATION, ANY PAYMENT TAXES OR OTHER TAXES IMPOSED OR ASSERTED BY ANY
JURISDICTION ON AMOUNTS PAYABLE UNDER THIS SECTION 3.20) PAID BY SUCH
LENDER OR AGENT (AS THE CASE MAY BE) AND ANY LIABILITY (INCLUDING
PENALTIES, INTEREST, AND EXPENSES) ARISING THEREFROM OR WITH RESPECT
THERETO.
(d) Each Lender organized under the laws of a jurisdiction outside
the U.S., on or prior to the date of its execution and delivery of this
Agreement in the case of each Lender listed on the signature pages
hereof and on or prior to the date on which it becomes a Lender in the
case of each other Lender, and from time to time thereafter if
requested in writing by Borrower or Agent (but only so long as such
Lender remains lawfully able to do so), shall provide Borrower and
Agent with (i) Internal Revenue Service Form 1001 or 4224, as
appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Lender is entitled to benefits under an
income tax treaty to which the U.S. is a party which reduces the rate
of withholding tax on payments of interest or certifying that the
income receivable pursuant to this Agreement is effectively connected
with the conduct of a trade or business in the U.S., (ii) Internal
Revenue Service Form W-8 or W-9, as appropriate, or any successor form
prescribed by the Internal Revenue Service, and (iii) any other form or
certificate required by any taxing authority (including any certificate
required by SECTIONS 871(h) and 881(c) of the Internal Revenue Code),
certifying that such Lender is entitled to an exemption from or a
reduced rate of tax on payments pursuant to any of the Loan Documents.
(e) For any period with respect to which a Lender has failed to
provide Borrower and Agent with the appropriate form pursuant to
SECTION 3.20(d) (unless such failure is due to a change in Law
occurring subsequent to the date on which a form originally was
required to be provided), such Lender shall not be entitled to
indemnification under SECTION 3.20(a) or 3.20(b) with respect to Taxes
imposed by the U.S.; provided, however, that should a Lender, which is
otherwise exempt from or subject to a reduced rate of withholding tax,
become subject to Taxes because of its failure to deliver a form
required hereunder, Borrower shall take such steps as such Lender shall
reasonably request to assist such Lender to recover such Taxes.
(f) If Borrower is required to pay additional amounts to or for
the account of any Lender pursuant to this SECTION 3.20, then such
Lender will agree to use reasonable efforts to change the jurisdiction
of its Applicable Lending Office so as to eliminate or reduce any such
additional payment which may thereafter accrue if such change, in the
judgment of such Lender, is not otherwise disadvantageous to such
Lender.
(g) Within 30 days after the date of any payment of Taxes,
Borrower shall furnish to Agent the original or a certified copy of a
receipt evidencing such payment.
(h) Without prejudice to the survival of any other agreement of
Borrower hereunder, the agreements and obligations of Borrower
contained in this SECTION 3.20 shall survive the termination of the
Commitments and the payment in full of the Notes.
3.21 Extensions and Conversions of Facility C Termination Date.
(a) If no Default or Potential Default exists, Borrower may
request 364-day extensions of the then-existing Facility C Termination
Date by making such request to Agent and each Lender
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not earlier than 60 days preceding the then-existing Termination Date
for such Lender. The then-existing Termination Date shall be extended
for 364 days with respect to each Lender only if such Lender consents
in writing to such extension within 30 days following Borrower's
request, with a failure to respond by any Lender being deemed a denial
of such consent by such party;
(b) If any 364-day period with respect to Facility C has not been
extended under SECTION 3.21(a) with respect to any Lender's Facility C
Commitment (whether due to Borrower's failure to timely request an
extension or such Lender's failure to timely consent to such
extension), and if no Default or Potential Default exists, then
Borrower may elect to convert such Lender's Loans under Facility C to a
term Loan maturing on the third anniversary of the last day of such
364- day period but in no event later than July 1, 2003. Principal and
interest on any such term Loan shall be payable in accordance with
SECTION 3.2.
3.22 Replacement Lender. In the event any Lender invokes SECTION 3.16
or 3.17 or Borrower becomes obligated to pay any additional amounts to any
Lender pursuant to SECTION 3.15, then, unless such Lender has removed or cured
the conditions actuating SECTION 3.15, 3.16, or 3.17, Borrower may designate a
substitute lender reasonably acceptable to Agent (such lender referred to in
this Agreement as a "REPLACEMENT LENDER") to purchase such Lender's rights and
obligations with respect to its entire Pro Rata Part under this Agreement. Any
such purchase shall be without recourse to or warranty by, or expense to, the
Lender in accordance with SECTION 14.12, and shall have a purchase price equal
to the outstanding principal amounts payable to the Lender with respect to its
entire Pro Rata Part under this Agreement, plus any accrued and unpaid interest,
fees and charges in respect of such Lender's Pro Rata Part, and on other terms
reasonably satisfactory to Agent. Upon such purchase by the Replacement Lender
and payment of all other amounts owing to the Lender being replaced, such
exiting Lender shall no longer be a party to this Agreement or have any rights
or obligations under this Agreement and the Replacement Lender shall succeed to
the Rights and obligations of the exiting Lender with respect to the exiting
Lender's Pro Rata Part and Commitments under this Agreement.
SECTION 4 FEES.
4.1 Treatment of Fees. The fees described in this SECTION 4 (a) are not
compensation for the use, detention, or forbearance of money, (b) are in
addition to, and not in lieu of, interest and expenses otherwise described in
this Agreement, (c) are payable in accordance with SECTION 3.1, (d) are
non-refundable, (e) to the fullest extent permitted by Law, bear interest, if
not paid when due, at the Default Rate, and (f) are calculated on the basis of
actual number of days (including the first day but excluding the last day)
elapsed, but computed as if each calendar year consisted of 360 days, unless
computation would result in an interest rate in excess of the Maximum Rate in
which event the computation is made on the basis of a year of 365 or 366 days,
as the case may be. The fees described in this SECTION 4 are in all events
subject to the provisions of SECTION 3.8 of this Agreement.
4.2 Underwriting and Administrative Fees. Borrower shall pay the
underwriting and administrative fees previously agreed to by Borrower and Agent
in the letter agreement dated March 13, 1998, and the letter agreement dated
March 25, 1998.
4.3 LC Fees. Borrower shall pay Agent, for its own account, a fronting
fee for the issuance of each LC equal to 0.125% per annum on the face amount of
such LC. Such fee shall be payable on the last day of the fiscal quarter of
Borrower in which such LC is issued. In addition, Borrower shall pay Agent
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quarterly, in arrears, on the last day of each fiscal quarter of Borrower during
which such LC is outstanding, a fee equal to the Applicable Margin for
Eurodollar Loans per annum on the face amount of the LC, provided that the
amount of such fee (as calculated on a per annum basis) shall not be less than
$350. Such fee shall be calculated on the basis of actual days elapsed, but
computed as if each calendar year consisted of 360 days. Borrower also agrees to
pay on demand and solely for the account Agent, any and all additional customary
LC fees described in SECTION 2.3(c).
4.4 Commitment Fee. Borrower shall pay to Agent for the ratable account
of Lenders a commitment fee, payable as it accrues on the last day of each
fiscal quarter of Borrower (commencing July 31, 1998) and on the Facility A
Termination Date, and with respect to each Lender, on the Facility C Termination
Date, equal to the Applicable Percentage per annum on the sum of (a) amount by
which the Facility A Commitment exceeds the average daily Facility A Commitment
Usage, in each case during the fiscal quarter ending on such date (or, in the
case of the first such payment, during the period from the date of the
Acquisition through July 31, 1998), plus (b) the amount by which the Facility C
Commitment exceeds the average daily Facility C Principal Debt, in each case
during the fiscal quarter ending on such date (or, in the case of the first such
payment, during the period from the date of the Acquisition through July 31,
1998).
SECTION 5 SECURITY.
5.1 Guaranty. Full and complete payment of the Obligation (a) is
guaranteed in accordance with the Guaranty of even date herewith executed by
each current Guarantor, and (b) shall be guaranteed through the execution and
delivery of a Guaranty by each future domestic direct or indirect Subsidiary of
Borrower.
5.2 Collateral. Full and complete payment of the Obligation shall be
secured through the execution and delivery of Pledge Agreements and Assignments
of Partnership Interests with respect to all capital stock, partnership
interests or other equity interests of any Company in any domestic direct or
indirect Subsidiaries (together with proceeds thereof and any additional
collateral ever furnished under SECTIONS 2.3(h), 3.11(b) or 5.3, the
"COLLATERAL").
5.3 Additional Security and Guaranties. Agent may, without notice or
demand and without affecting any Person's obligations under the Loan Documents,
from time to time (a) receive and hold additional collateral from any Person for
the payment of all or any part of the Obligation and exchange, enforce or
release all or any part of that collateral and (b) accept and hold any
endorsement or guaranty of payment of all or any part of the Obligation and
release any endorser or guarantor, or any Person who has given any other
security for the payment of all or any part of the Obligation, or any other
Person in any way obligated to pay all or any part of the Obligation.
SECTION 6 CONDITIONS PRECEDENT.
6.1 General.
Lenders will not be obligated to fund the initial Loan on the date of
the Acquisition unless: (a) Agent has timely received a Loan Request and all of
the items described on SCHEDULE 6; (b) no circumstance or event exists that,
individually or collectively with other circumstances or events, has had a
material and adverse effect on the financial condition of Borrower or MBCI
(individually) or Borrower, Amatek and their respective Subsidiaries (as a
whole) as represented in the Financial Statements of Borrower dated as of
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October 31, 1997, and the financial statements of MBCI dated as of December 31,
1997; and (c) the funding of the Loan is permitted by Law.
After the Acquisition, Lenders will not be obligated to fund (as
opposed to Continue or Convert) any Loan, and Agent will not be obligated to
issue any LC unless on the applicable Loan Date, issue date, or creation date
(and after giving effect to the requested Loan or LC, as the case may be): (i)
Agent shall have timely received a Loan Request or LC Request (together with the
applicable duly executed LC Agreement); (ii) all of the representations and
warranties of the Companies in the Loan Documents are true and correct in all
material respects (unless they speak to a specific date or are based on facts
which have changed by transactions contemplated or permitted by this Agreement);
(iii) no Material Adverse Event, Default or Potential Default exists; and (iv)
the funding of the Loan or issuance of the LC, as the case may be, is permitted
by Law.
Upon Agent's request, Borrower shall deliver to Agent evidence
substantiating any of the matters in the Loan Documents that are necessary to
enable Borrower to qualify for the Loan or LC, as the case may be. Each
condition precedent in this Agreement (including, without limitation, those on
SCHEDULE 6) is material to the transactions contemplated by this Agreement, and
time is of the essence with respect to each condition precedent. Subject to the
prior approval of Determining Lenders, Lenders may fund any Loan, and Agent may
issue any LC, without all conditions being satisfied, but, to the extent
permitted by Law, that funding and issuance shall not be deemed to be a waiver
of the requirement that each condition precedent be satisfied as a prerequisite
for any subsequent funding or issuance, unless Determining Lenders specifically
waive each item in writing.
6.2 Supplements to Schedules. Borrower may, from time to time but in no
event less than five Business Days prior to delivery of any Loan Request or LC
Request, amend or supplement the Schedules to this Agreement by delivering
(effective upon receipt) to Agent and each Lender a copy of such revised
Schedule or Schedules, which shall (i) be dated the date of delivery, (ii) be
certified by a Responsible Officer as true, complete and correct as of such date
and as delivered in replacement for the corresponding Schedule or Schedules
previously in effect, and (iii) show in reasonable detail (by blacklining or
other appropriate graphic means) the changes from each such corresponding
predecessor Schedule. Notwithstanding anything to the contrary contained herein
or in any of the other Loan Documents, in the event that Determining Lenders
determine based upon such revised Schedules (whether individually or in the
aggregate or cumulatively) that a Material Adverse Event has occurred, Lenders
shall have no further obligation to make Loans or continue or convert any Loan
previously made and Agent shall have no further obligation to issue LCs or to
renew or extend existing LCs.
SECTION 7 REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants
to Agent and Lenders as follows:
7.1 Purpose of Credit Facility. Borrower will use the proceeds of the
initial Loans to consummate the Acquisition and to repay and cancel the Existing
Bank Debt. Borrower will use all other proceeds of the Loans and LCs for working
capital and general corporate purposes of the Companies. No Company is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying any "margin stock" within the
meaning of Regulation U of the Board of Governors of the Federal Reserve System,
as amended. No part of the proceeds of any LC draft or drawing or Loan will be
used, directly or indirectly, for a purpose that violates any Law, including
without limitation, the provisions of Regulation U.
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7.2 Corporate Existence, Good Standing, Authority and Compliance. Each
Company is duly organized, validly existing and in good standing under the Laws
of the jurisdiction in which it is incorporated or organized as identified on
SCHEDULE 7.2. Except where failure is not a Material Adverse Event, each Company
(a) is duly qualified to transact business and is in good standing as a foreign
corporation or other entity in each jurisdiction where the nature and extent of
its business and properties require due qualification and good standing (those
jurisdictions being identified on SCHEDULE 7.2), (b) possesses all requisite
authority, permits and power to conduct its business as is now being, or is
contemplated by this Agreement to be, conducted, and (c) is in compliance with
all applicable Laws.
7.3 Subsidiaries. As of the date of this Agreement, Borrower has no
Subsidiaries except as disclosed on SCHEDULE 7.3. All of the outstanding shares
of capital stock (or similar voting interests) of those Subsidiaries are duly
authorized, validly issued, fully paid and nonassessable and together with the
partnership interests pledged pursuant to SECTION 5.2 hereof are owned of record
and beneficially as set forth thereon, free and clear of any Liens,
restrictions, claims or Rights of another Person (other than Lender Liens and,
with respect to partnership interests, any Liens, restrictions, claims or Rights
contained in the relevant partnership agreement), and are not subject to any
warrant, option or other acquisition Right of any Person or subject to any
transfer restriction (other than restrictions imposed by securities Laws and
general corporate Laws and, with respect to partnership interests, any
restrictions contained in the relevant partnership agreement).
7.4 Authorization and Contravention. The execution and delivery by each
Company of each Loan Document or related document to which it is a party and the
performance by it of its obligations thereunder (a) are within its corporate
power, (b) have been duly authorized by all necessary corporate action, (c)
require no action by or filing with any Tribunal (other than any action or
filing that has been taken or made on or before the date of this Agreement), (d)
do not violate any provision of its charter or bylaws, (e) do not violate any
provision of Law or order of any Tribunal applicable to it, other than
violations that individually or collectively are not a Material Adverse Event,
(f) do not violate any Material Agreements to which it is a party, or (g) do not
result in the creation or imposition of any Lien (other than the Lender Liens)
on any asset of any Company.
7.5 Binding Effect. Upon execution and delivery by all parties thereto,
each Loan Document will constitute a legal and binding obligation of each
Company party thereto, enforceable against it in accordance with its terms,
except as enforceability may be limited by applicable Debtor Relief Laws and
general principles of equity.
7.6 Financial Statements; Fiscal Year. The Current Financials were
prepared in accordance with GAAP and present fairly, in all material respects,
the consolidated financial condition, results of operations, and cash flows of
the Companies as of, and for the portion of the fiscal year ending on the date
or dates thereof (subject only to normal year-end adjustments). All material
liabilities of the Companies as of the date or dates of the Current Financials
are reflected therein or in the notes thereto. Except for transactions directly
related to, or specifically contemplated by, the Loan Documents, no subsequent
material adverse changes have occurred in the consolidated financial condition
of the Companies from that shown in the Current Financials, nor has any Company
incurred any subsequent material liability. All financial projections concerning
the Companies that have been or are hereafter made available to Agent or Lenders
by Borrower have been or will be prepared in good faith based upon assumptions
Borrower believes to be reasonable. The fiscal year of each Company ends on
October 31.
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7.7 Litigation. Except as disclosed on SCHEDULE 7.7, no Company is
subject to, or aware of the threat of, any Litigation that is reasonably likely
to be determined adversely to any Company and, if so adversely determined, is a
Material Adverse Event. Except as permitted under SECTION 11.4, no outstanding
and unpaid judgments against any Company exist.
7.8 Taxes. All Tax returns of each Company required to be filed have
been filed (or extensions have been granted) before delinquency, except for
returns for which the failure to file is not a Material Adverse Event, and all
Taxes imposed upon each Company that are due and payable have been paid before
delinquency, other than (a) Taxes which are being contested in good faith by
lawful proceedings diligently conducted, against which reserve or other
provision required by GAAP has been made, and in respect of which levy and
execution of any Lien have been and continue to be stayed, and (b) state and
local Taxes (except income Taxes) which are immaterial in amount and in respect
of which levy and execution of any Lien have been and continue to be stayed.
7.9 Environmental Matters. Except as disclosed on SCHEDULE 7.9, (a)
each Company is, and within the period of all applicable statutes of limitations
has been, in substantial compliance with all applicable Environmental Laws and
with all permits required thereunder; (b) no Materials of Environmental Concern
are present at, on, under, in or about any real property now or formerly owned,
leased, operated or used by any Company (including, without limitation, any
location to which any Materials of Environmental Concern have been sent for
reuse or recycling or for treatment, storage or disposal) which could reasonably
be expected to give rise to material liability of any Company under any
applicable Environmental Law, materially interfere with the continued operations
of any Company, or materially impair the fair saleable value of any real
property owned or leased by any Company; (c) except for violations or alleged
violations which have been fully and finally resolved or have been barred by the
applicable statute of limitations, no Company has received any notice or report,
or has knowledge, of any Company's violation or alleged violation of any
Environmental Law; (d) no Company is under any obligation to fund or conduct
remediation of any property; (e) no Company knows of any environmental condition
or circumstances materially adversely affecting any Company's properties or
operations; (f) there are no pending or, to the Companies' knowledge,
threatened, judicial, administrative, or arbitral proceedings under or relating
to any Environmental Law to which any Company is, or to Company's knowledge is
threatened to be, named as a party; (g) no Company has received any written
request for information or been notified that it is a potentially responsible
party under any Environmental Law; and (h) no Company has assumed or retained,
by contract or operation of law, any material liabilities of any kind under or
relating to any Environmental Law. Each Company has taken prudent steps to
determine that its properties and operations do not violate any Environmental
Law, other than violations that are not, individually or in the aggregate, a
Material Adverse Event.
7.10 Employee Plans. Except where occurrence or existence is not a
Material Adverse Event, (a) no Employee Plan has incurred an "accumulated
funding deficiency" (as defined in section 302 of ERISA or section 412 of the
Code), (b) no Company has incurred liability under ERISA to the PBGC in
connection with any Employee Plan (other than required insurance premiums, all
of which have been paid), (c) no Company has withdrawn in whole or in part from
participation in a Multiemployer Plan, (d) no Company has engaged in any
"prohibited transaction" (as defined in section 406 of ERISA or section 4975 of
the Code), and (e) no "reportable event" (as defined in section 4043 of ERISA)
has occurred, excluding events for which the notice requirement is waived under
applicable PBGC regulations.
7.11 Properties; Liens. Each Company has good and indefeasible title to
all its property reflected on the Current Financials (except for property that
is obsolete or that has been disposed in the ordinary
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course of business or, after the date of this Agreement, as otherwise permitted
by SECTION 9.10 or SECTION 9.11). Except for Permitted Liens, no Lien exists on
any property of any Company, and the execution, delivery, performance or
observance of the Loan Documents will not require or result in the creation of
any Lien (other than Lender Liens) on any Company's property.
7.12 Location. Each Company's chief executive office is located at the
address on SCHEDULE 7.12.
7.13 Government Regulations. No Company is subject to regulation under
the Investment Company Act of 1940, as amended, or the Public Utility Holding
Company Act of 1935, as amended.
7.14 Transactions with Affiliates. Except as disclosed on SCHEDULE
7.14. no Company is a party to a material transaction with any of its Affiliates
(excluding other Companies), other than transactions in the ordinary course of
business and upon fair and reasonable terms not materially less favorable than
it could obtain or could become entitled to in an arm's-length transaction with
a Person that was not its Affiliate. For purposes of this SECTION 7.14, a
transaction is "material" if it requires any Company to pay more than $5,000,000
during the term of the governing agreement.
7.15 Debt. No Company is an obligor on any Debt, other than Permitted
Debt.
7.16 Material Agreements. All Material Agreements of the Companies are
in full force and effect, and no default or potential default exists on the part
of any Company thereunder that is a Material Adverse Event.
7.17 Insurance. Each Company maintains with financially sound,
responsible, and reputable insurance companies or associations (or, as to
workers' compensation or similar insurance, with an insurance fund or by
self-insurance authorized by the jurisdictions in which it operates) insurance
concerning its properties and businesses against casualties and contingencies
and of types and in amounts (and with co-insurance and deductibles) as is
customary in the case of similar businesses.
7.18 Labor Matters. No actual or, to the Companies' knowledge,
threatened strikes, labor disputes, slow downs, walkouts, or other concerted
interruptions of operations by the employees of any Company that are a Material
Adverse Event exist. Hours worked by and payment made to employees of the
Companies have not been in violation of the Fair Labor Standards Act or any
other applicable Law dealing with labor matters, other than any violations,
individually or collectively, that are not a Material Adverse Event. All
payments due from any Company for employee health and welfare insurance have
been paid or accrued as a liability on its books, other than any nonpayments
that are not, individually or collectively, a Material Adverse Event.
7.19 Solvency. On each Loan Date, each Company is, and after giving
effect to the requested Loan will be, Solvent.
7.20 Trade Names. No Company has used or transacted business under any
other corporate or trade name in the five-year period preceding the initial Loan
Date, except as disclosed on SCHEDULE 7.20.
7.21 Intellectual Property. Each Company owns or has the right to use
all material licenses, patents, patent applications, copyrights, service marks,
trademarks, trademark applications and trade names necessary to continue to
conduct its businesses as presently conducted by it and proposed to be conducted
by it immediately after the date of this Agreement. Each Company is conducting
its business without
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infringement or claim of infringement of any license, patent, copyright, service
xxxx, trademark, trade name, trade secret or other intellectual property right
of others, other than any infringements or claims that, if successfully asserted
against or determined adversely to any Company, would not, individually or
collectively, constitute a Material Adverse Event. To the knowledge of any
Company, no infringement or claim of infringement by others of any material
license, patent, copyright, service xxxx, trademark, trade name, trade secret or
other intellectual property of any Company exists.
7.22 Full Disclosure. Each material fact or condition relating to the
Loan Documents or the financial condition, business or property of any Company
has been disclosed in writing to Agent. All information previously furnished,
furnished on the date of this Agreement, and furnished in the future, by any
Company to Agent in connection with the Loan Documents (a) was, is, and will be,
true and accurate in all material respects or, in the case of projections, was
based on reasonable estimates on the date the information is stated or
certified, and (b) (i) in the case of projections, was not based on unreasonable
estimates as of the date the information is stated or certified, or (ii) in the
case of all other information, did not, does not, and will not, fail to state
any fact the omission of which would otherwise make any such information
materially misleading.
7.23 Acquisition. Prior to, or simultaneously with, the funding of the
initial Loan (a) the Acquisition has been consummated in accordance with the
Purchase Agreement and all applicable Laws for a total cost (excluding fees and
expenses, but including assumed indebtedness for borrowed money) of not more
than $570,000,000 plus up to 700,000 shares of Borrower's common stock, (b) all
consents and approvals of, and filings and registrations with, and all other
actions in respect of, all Tribunals required to consummate the Acquisition have
been obtained, given, filed, taken or waived and are in full force and effect,
(c) all applicable waiting periods with respect thereto have expired without any
action being taken by any Tribunal to restrain, prevent or impose material
adverse conditions upon the Acquisition, and (d) no judgment, order or
injunction exists which prohibits or imposes any material adverse condition upon
the Acquisition or the performance of any Company of its obligations in
connection therewith. No Company or any Affiliate of any Company is entering
into the Acquisition with the intent to hinder, delay or defraud any creditor of
any Company.
SECTION 8 AFFIRMATIVE COVENANTS. So long as Lenders are committed to fund any
Loans and Agent is committed to issue LCs under this Agreement, and thereafter
until the Obligation is paid in full, Borrower covenants and agrees as follows:
8.1 Items to be Furnished. Borrower shall cause the following to be
furnished to Agent:
(a) Promptly after preparation, and no later than 120 days
after the last day of each fiscal year of Borrower, Financial
Statements showing the consolidated financial condition and results of
operations of the Companies as of, and for the year ended on, that last
day, accompanied by:
(i) the unqualified opinion of a firm of nationally-recognized
independent certified public accountants, based on an audit using
generally accepted auditing standards, that the Financial
Statements were prepared in accordance with GAAP and present
fairly, in all material respects, the consolidated financial
condition and results of operations of the Companies,
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(ii) any management letter prepared by the accounting firm
delivered in connection with its audit, and
(iii) a Compliance Certificate with respect to the Financial
Statements.
(b) Promptly after preparation, and no later than 45 days after the
last day of each fiscal quarter of Borrower, Financial Statements
showing the consolidated financial condition and results of operations
of the Companies for the fiscal quarter and for the period from the
beginning of the current fiscal year to the last day of the fiscal
quarter, accompanied by a Compliance Certificate with respect to the
Financial Statements.
(c) Promptly after receipt, a copy of each interim or special audit
report and management letter issued by independent accountants with
respect to any Company or its financial records.
(d) Notice, promptly (and, in any event, within five Business Days)
after Borrower knows or has reason to know, of (i) the existence and
status of any Litigation that, if determined adversely to any Company,
would be a Material Adverse Event, (ii) any change in any material fact
or circumstance represented or warranted by any Company in any Loan
Document, (iii) the receipt by any Company of notice of any violation
or alleged violation of ERISA or any Environmental Law or of any
condition which, under any applicable Environmental Law, could give
rise to liability or impair the saleable value of any real property now
or previously owned, leased or used by any Company, or (iv) a Default,
Potential Default or Material Adverse Event, in each case specifying
the nature thereof and what action the Companies have taken, are
taking, or propose to take.
(e) Promptly (and, in any event, within 10 days) after filing or
sending, copies of all material reports or filings filed by or on
behalf of any Company with any Tribunal (including, without limitation,
copies of each Form 10-K, Form 10-Q and Form S-8 filed by or on behalf
of any Company with the Securities and Exchange Commission) or sent to
its stockholders.
(f) Promptly after preparation, and no later than 30 days after the
last day of each fiscal quarter of Borrower, copies of all Phase I
Environmental Site Assessment Reports obtained by the Companies in
connection with acquisitions of interests in real property (or
acquisitions of Persons owning interests in real property) closed
during such fiscal quarter.
(g) Promptly upon reasonable request by Agent or Determining
Lenders (through Agent), information (not otherwise required to be
furnished under the Loan Documents) respecting the business affairs,
assets and liabilities of the Companies and opinions, certifications
and documents in addition to those mentioned in this Agreement.
8.2 Use of Proceeds. Borrower shall use the proceeds of Loans only for
the purposes represented in this Agreement.
8.3 Books and Records. The Companies will maintain books, records and
accounts necessary to prepare financial statements in accordance with GAAP.
8.4 Inspections. Upon three Business Days notice, each Company will
allow Agent or any Lender (or their Representatives) to inspect any of its
properties, to review reports, files and other records
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and to make and take away copies, to conduct tests or investigations, and to
discuss any of its affairs, conditions and finances with such Company's other
creditors, directors, officers, employees or representatives from time to time,
during reasonable business hours.
8.5 Taxes. The Companies will promptly pay when due any and all Taxes,
other than (a) Taxes which are being contested in good faith by lawful
proceedings diligently conducted, against which reserve or other provision
required by GAAP has been made, and in respect of which levy and execution of
any Lien have been and continue to be stayed, and (b) state and local Taxes
(except income Taxes) which are immaterial in amount and in respect of which
levy and execution of any Lien have been and continue to be stayed. No Company
shall use any proceeds of Loans hereunder to pay the wages of employees unless a
timely payment to or deposit with the U.S. of all amounts of tax required to be
deducted or withheld with respect to such wages is also made.
8.6 Payment of Obligations. Each Company will promptly pay (or renew
and extend) all of its material obligations as they become due (unless the
obligations are being contested in good faith by appropriate proceedings).
8.7 Expenses; Indemnification.
(a) Borrower agrees to pay on demand all costs and expenses of
Agent in connection with the preparation, due diligence, execution,
delivery, administration, syndication, modification, and amendment of
the Loan Documents and the other documents to be delivered hereunder,
including, without limitation, the reasonable fees and expenses of
counsel for Agent (including the cost of internal counsel) with respect
thereto and with respect to advising Agent as to its rights and
responsibilities under the Loan Documents. Borrower further agrees to
pay on demand all costs and expenses of Agent and Lenders, if any
(including, without limitation, reasonable attorneys' fees and expenses
and the cost of internal counsel), in connection with the enforcement
(whether through negotiations, legal proceedings, or otherwise) of the
Loan Documents and the other documents to be delivered hereunder.
(b) BORROWER AGREES TO INDEMNIFY AND HOLD HARMLESS AGENT AND
EACH LENDER AND EACH OF THEIR AFFILIATES AND THEIR RESPECTIVE OFFICERS,
DIRECTORS, EMPLOYEES, AGENTS, AND ADVISORS (EACH, AN "INDEMNIFIED
PARTY") FROM AND AGAINST ANY AND ALL CLAIMS, DAMAGES, LOSSES,
LIABILITIES, COSTS, AND EXPENSES (INCLUDING, WITHOUT LIMITATION,
REASONABLE ATTORNEYS' FEES) THAT MAY BE INCURRED BY OR ASSERTED OR
AWARDED AGAINST ANY INDEMNIFIED PARTY, IN EACH CASE ARISING OUT OF OR
IN CONNECTION WITH OR BY REASON OF (INCLUDING, WITHOUT LIMITATION, IN
CONNECTION WITH ANY INVESTIGATION, LITIGATION, OR PROCEEDING OR
PREPARATION OF DEFENSE IN CONNECTION THEREWITH) THE LOAN DOCUMENTS, ANY
OF THE TRANSACTIONS CONTEMPLATED HEREIN OR THE ACTUAL OR PROPOSED USE
OF THE PROCEEDS OF THE LOANS (INCLUDING ANY OF THE FOREGOING ARISING
FROM THE NEGLIGENCE OF THE INDEMNIFIED PARTY), EXCEPT TO THE EXTENT
SUCH CLAIM, DAMAGE, LOSS, LIABILITY, COST, OR EXPENSE IS FOUND IN A
FINAL, NON-APPEALABLE JUDGMENT BY A COURT OF COMPETENT JURISDICTION TO
HAVE RESULTED FROM SUCH INDEMNIFIED PARTY'S GROSS NEGLIGENCE OR WILLFUL
MISCONDUCT. IN THE CASE OF AN INVESTIGATION, LITIGATION OR OTHER
PROCEEDING TO WHICH THE INDEMNITY IN THIS SECTION 8.7(B) APPLIES, SUCH
INDEMNITY SHALL BE EFFECTIVE WHETHER OR NOT SUCH INVESTIGATION,
LITIGATION OR PROCEEDING IS BROUGHT BY BORROWER, ITS DIRECTORS,
SHAREHOLDERS OR CREDITORS OR AN INDEMNIFIED PARTY OR ANY OTHER PERSON
OR ANY
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INDEMNIFIED PARTY IS OTHERWISE A PARTY THERETO AND WHETHER OR NOT THE
TRANSACTIONS CONTEMPLATED HEREBY ARE CONSUMMATED; SUBJECT, HOWEVER, TO
THE LIMITATION AS TO GROSS NEGLIGENCE OR WILLFUL MISCONDUCT CONTAINED
IN THE PRECEDING SENTENCE. BORROWER AGREES NOT TO ASSERT ANY CLAIM
AGAINST ANY INDEMNIFIED PARTY, ON ANY THEORY OF LIABILITY, FOR SPECIAL,
INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES ARISING OUT OF OR
OTHERWISE RELATING TO THE LOAN DOCUMENTS, ANY OF THE TRANSACTIONS
CONTEMPLATED HEREIN OR THE ACTUAL OR PROPOSED USE OF THE PROCEEDS OF
THE LOANS. SO LONG AS NO DEFAULT EXISTS, NO CLAIM FOR WHICH INDEMNITY
IS CLAIMED HEREUNDER SHALL BE COMPROMISED OR SETTLED BY AN INDEMNIFIED
PARTY WITHOUT THE PRIOR WRITTEN CONSENT OF BORROWER. NOTHING CONTAINED
HEREIN SHALL PREVENT BORROWER FROM BRINGING A SEPARATE ACTION AGAINST
ANY PARTY HERETO FOR BREACH OF ANY CONTRACTUAL OBLIGATION CONTAINED IN
THE LOAN DOCUMENTS, NOR SHALL THE PROVISIONS OF THIS SECTION 8.7(B) BE
APPLICABLE WITH RESPECT TO ANY ACTION BETWEEN BORROWER AND ANY OTHER
PARTY FOR BREACH OF CONTRACTUAL OBLIGATION CONTAINED IN THE LOAN
DOCUMENTS IN WHICH BORROWER IS THE PREVAILING PARTY.
(c) Without prejudice to the survival of any other agreement
of Borrower hereunder, the agreements and obligations of Borrower
contained in this SECTION 8.7 shall survive the payment in full of the
Loans and all other amounts payable under this Agreement.
(d) Amounts payable under this SECTION 8.7 shall be a part of
the Obligation and, if not paid upon demand, shall bear interest at the
Default Rate until paid.
8.8 Maintenance of Existence, Assets, and Business. Except as otherwise
permitted by SECTION 9.11, each Company will (a) maintain its corporate
existence and good standing in its state of incorporation and its authority to
transact business in all other states where failure to maintain its authority to
transact business is a Material Adverse Event; (b) maintain all licenses,
permits and franchises necessary for its business where failure to do so is a
Material Adverse Event; (c) keep all of its assets that are useful in and
necessary to its business in good working order and condition (ordinary wear and
tear excepted) and make all necessary repairs and replacements. No Company will
relocate its chief executive office unless prior thereto it gives Agent 30 days
prior written notice of such proposed location (such notice to include, without
limitation, the name of the county or parish and state of such location).
8.9 Insurance. The Companies will maintain with financially sound,
responsible and reputable insurance companies or associations (or, as to
workers' compensation or similar insurance, with an insurance fund or by
self-insurance authorized by the jurisdictions in which they operate) insurance
concerning their properties and businesses against casualties and contingencies
and of types and in amounts (and with co-insurance and deductibles) as is
customary in the case of similar businesses.
8.10 Preservation and Protection of Rights. The Companies will perform
the acts and duly authorize, execute, acknowledge, deliver, file and record any
Security Documents, financing statements, stock powers and other writings as
Agent or Determining Lenders may reasonably deem necessary or appropriate to
perfect and maintain the Lender Liens and preserve and protect the Rights of
Agent and Lenders under any Loan Document, and will pay all costs of any related
filings or recordations and any Lien searches.
8.11 Environmental Laws. The Companies will (a) conduct their business
so as to comply with all applicable Environmental Laws and shall promptly take
corrective action to remedy any non-compliance
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with any Environmental Law, except where failure to comply or take action would
not be a Material Adverse Event, and (b) establish and maintain a management
system designed to ensure compliance with applicable Environmental Laws and
minimize financial and other risks to each Company arising under applicable
Environmental Laws or as the result of environmentally related injuries to
Persons or property. Borrower shall deliver reasonable evidence of compliance
with the foregoing covenant to Agent within 30 days after any request from
Determining Lenders.
8.12 Subsidiaries. The Companies will pledge to Agent for the benefit
of Lenders all stock or partnership interests of each Person that becomes a
domestic direct or indirect Subsidiary of Borrower after the date of this
Agreement (whether as a result of acquisition, creation or otherwise) and shall
cause each such new Subsidiary to execute and deliver a Guaranty, an Officer's
Certificate (concerning articles of incorporation, bylaws, resolutions and
incumbency) and an opinion of counsel (addressing points 4(a), (b), (c), (d) and
(e) of EXHIBIT L with respect to such Subsidiary), in each case within 10
Business Days after becoming a Subsidiary of Borrower.
SECTION 9 NEGATIVE COVENANTS. So long as Lenders are committed to fund Loans and
Agent is committed to issue LCs under this Agreement, and thereafter until the
Obligation is paid in full, Borrower covenants and agrees as follows:
9.1 Taxes. No Company may use any portion of the proceeds of any Loan
to pay the wages of employees, unless a timely payment to or deposit with the
U.S. of all amounts of Tax required to be deducted and withheld with respect to
such wages is also made.
9.2 Payment of Obligations. No Company may voluntarily prepay principal
of, or interest on, any Debt, other than the Obligation, if a Default or
Potential Default exists.
9.3 Employee Plans. Except where a Material Adverse Event would not
result, no Company may permit any of the events or circumstances described in
SECTION 7.10 to exist or occur.
9.4 Debt. No Company may create, incur or suffer to exist any Funded
Debt, other than Permitted Debt.
9.5 Liens. No Company may (a) create, incur or suffer or permit to be
created or incurred or to exist any Lien upon any of its assets, other than
Permitted Liens, or (b) enter into or permit to exist any arrangement or
agreement that directly or indirectly prohibits any Company from creating or
incurring any Lien on any of its assets, other than the Loan Documents, leases
that place a Lien prohibition on only the leased property and transactions which
result in purchase money debt.
9.6 Transactions with Affiliates. Except as disclosed on SCHEDULE 7.14
(if the disclosures are approved by Determining Lenders), no Company may enter
into any material transaction with any of its Affiliates (excluding other
Companies), other than transactions in the ordinary course of business and upon
fair and reasonable terms not materially less favorable than it could obtain or
could become entitled to in an arm's-length transaction with a Person that was
not its Affiliate. For purposes of this SECTION 9.6, a transaction is "material"
if it requires any Company to pay more than $5,000,000 during the term of the
agreement governing such transaction.
9.7 Compliance with Laws and Documents. No Company may (a) violate the
provisions of any Laws applicable to it or of any Material Agreement to which it
is a party if that violation alone, or when
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aggregated with all other violations, would be a Material Adverse Event (unless
such Company disagrees that a violation has occurred, is contesting the
allegation of a violation in good faith by lawful proceedings diligently
conducted, has made any reserve or other provision against such alleged
violation required by GAAP, and has stayed any levy or execution of Lien
relating to such alleged violation), (b) violate the provisions of its charter
or bylaws, or (c) repeal, replace or amend any provision of its charter or
bylaws if that action would be a Material Adverse Event.
9.8 Loans, Advances and Investments. Except as permitted by SECTION 9.9
or SECTION 9.11, no Company may make any loan, advance, extension of credit or
capital contribution to, make any investment in, or purchase or commit to
purchase any stock or other securities or evidences of Debt of, or interests in,
any other Person, other than (a) expense accounts for and other advances to its
directors, officers and employees in the ordinary course of business; (b)
marketable obligations issued or unconditionally guaranteed by the U.S.
Government or issued by any of its agencies and backed by the full faith and
credit of the U. S., in each case maturing within one year from the date of
acquisition (and investments in mutual funds investing primarily in those
obligations); (c) short-term investment grade domestic and eurodollar
certificates of deposit or time deposits that are fully insured by the Federal
Deposit Insurance Corporation or are issued by commercial banks having combined
capital, surplus, and undivided profits of not less than $100,000,000 (as shown
on its most recently published statement of condition); (d) commercial paper and
similar obligations rated "P-1" by Xxxxx'x Investors Service, Inc., or "A-1" by
Standard & Poor's Ratings Group (a division of McGraw Hill, Inc.); (e)
inter-Company loans and advances; (f) readily marketable tax-free municipal
bonds of a domestic issuer rated "Aaa" by Xxxxx'x Investors Service, Inc., or
"AAA" by Standard & Poors Ratings Group (a division of McGraw Hill, Inc.), and
maturing within one year from the date of issuance (and investments in mutual
funds investing primarily in those bonds); (g) demand deposit accounts
maintained in the ordinary course of business; (h) other investments existing on
the initial Loan Date and described on SCHEDULE 9.8 (and, with respect to Amatek
and its Subsidiaries, existing on the date of Acquisition); (i) extensions of
credit in connection with trade receivables and overpayments of trade payables,
in each case resulting from transactions in the ordinary course of business; and
(j) as long as no Default or Potential Default exists, other loans, advances,
and investments aggregating no more than 5% of the Companies' Net Worth at any
time.
9.9 Dividends and Distributions. No Company may declare, make or pay
any Distribution, other than Distributions declared, made or paid by (a)
Borrower wholly in the form of its capital stock and (b) any other Company to
Borrower. No Company shall enter into any arrangement or agreement (other than
this Agreement) that prohibits it from paying dividends or other distributions
to its shareholders.
9.10 Sale of Assets. No Company may sell, assign, lease, transfer or
otherwise dispose of any of its assets, other than (a) sales of inventory in the
ordinary course of business, (b) the sale, discount or transfer of delinquent
accounts receivable in the ordinary course of business for purposes of
collection, (c) occasional sales, leases or other dispositions of immaterial
assets for consideration not less than fair market value, (d) sales, leases or
other dispositions of assets that are obsolete or have negligible fair market
value, (e) sales of equipment for a fair and adequate consideration (but the
seller must promptly replace the sold equipment), (f) sales for which the cash
proceeds thereof (after selling expenses and taxes related thereto to the extent
paid and any reserves for retained liabilities until such liabilities are
extinguished) are applied in prepayment of the Principal Debt in accordance with
SECTION 3.2(c), and (g) other sales of assets which do not exceed $500,000 in
the aggregate annually.
9.11 Mergers and Dissolutions. No Company may acquire all or any
substantial portion of stock issued by, interest in, or assets of any other
Person (the "ACQUIREE"), unless (a) immediately after the
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acquisition no Default or Potential Default exists and a Responsible Officer
represents to Agent and Lenders in writing that the acquisition will not
reasonably be expected to cause any Default or Potential Default then or within
the one-year period thereafter, (b) the Acquiree has consented to the
acquisition, and (c) the Acquiree is in the same or similar business as the
Companies (or a reasonably related business). Borrower may not, and may not
permit any Subsidiary to, merge or consolidate with any other Person, unless
immediately thereafter no Default or Potential Default exists and (i) Borrower,
if a party thereto, is the surviving corporation or (ii) if Borrower is not a
party thereto, the surviving corporation has either previously executed a
Guaranty or assumes, in writing, the non-surviving corporation's obligations
created by any Guaranty executed by the non-surviving corporation. Except as a
result of a transaction permitted by this SECTION 9.11, no Company will
liquidate, wind up, or dissolve (or suffer any liquidation or dissolution).
9.12 Assignment. No Company may assign or transfer any of its Rights,
duties, or obligations under any of the Loan Documents, except if any Company
merges with another Company as permitted by SECTION 9.11, the assignment or
transfer of the Rights, duties, and obligations of the non-surviving Company is
permitted if the surviving Company assumes in writing all Rights, duties, and
obligations of the non- surviving Company under the Loan Documents.
9.13 Fiscal Year and Accounting Methods. No Company may change its
fiscal year or its method of accounting (other than immaterial changes in
methods or as required by GAAP).
9.14 New Businesses. No Company may engage in any business except the
businesses in which they are presently engaged and any other reasonably related
business.
9.15 Government Regulations. No Company may conduct its business in a
way that it becomes regulated under the Investment Company Act of 1940, as
amended, or the Public Utility Holding Company Act of 1935, as amended.
9.16 Tax Sharing Agreements. The Companies shall not enter into any tax
sharing arrangements which obligate them to pay more Taxes collectively than
they would otherwise pay absent such arrangements.
SECTION 10 FINANCIAL COVENANTS. So long as Lenders are committed to fund Loans
and Agent is committed to issue LCs under this Agreement, and thereafter until
the Obligation is paid and performed in full, Borrower covenants and agrees as
follows:
10.1 Minimum Net Worth. Borrower shall not permit Net Worth, as of the
last day of any fiscal quarter of Borrower, commencing with October 31, 1998, to
be less than the sum of (a) $150,000,000, plus (b) an amount equal to the
greater of zero (0) and 75% of the consolidated net earnings after taxes of the
Companies determined in accordance with GAAP for the period (taken as a single
accounting period) from and including August 1, 1998, to and including such day,
plus (c) an amount equal to 100% of any cash proceeds (net of underwriting
discounts and commissions and other costs associated therewith) received by the
Companies from the issuance and sale of equity securities for the period (taken
as a single accounting period) from and including August 1, 1998, to and
including such day.
10.2 Maximum Leverage Ratio. Borrower shall not permit the ratio, as of
the last day of each fiscal quarter of Borrower listed below, of Funded Debt as
of such date to EBITDA for the four fiscal quarters ended on such date to exceed
the ratio set forth below opposite such day:
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October 31, 1998 4.50 to 1.00
January 31, 1999 4.50 to 1.00
April 30, 1999 4.50 to 1.00
July 31, 1999 4.50 to 1.00
October 31, 1999 4.25 to 1.00
January 31, 2000 4.25 to 1.00
April 30, 2000 4.25 to 1.00
July 31, 2000 4.25 to 1.00
October 31, 2000 4.00 to 1.00
January 31, 2001 4.00 to 1.00
April 30, 2001 4.00 to 1.00
July 31, 2001 4.00 to 1.00
Thereafter 3.50 to 1.00
10.3 Maximum Senior Debt Ratio. Effective upon the incurrence by any
Company of Funded Debt in the amount of $100,000,000 or more which is
contractually subordinated or junior in right of payment to the Obligation,
Borrower shall not permit the ratio, as of the last day of each fiscal quarter
of Borrower listed below, of Senior Debt as of such date to EBITDA for the four
fiscal quarters ended on such date to exceed the ratio set forth below opposite
such day:
October 31, 1998 4.50 to 1.00
January 31, 1999 3.25 to 1.00
April 30, 1999 3.25 to 1.00
July 31, 1999 3.25 to 1.00
October 31, 1999 3.25 to 1.00
January 31, 2000 3.00 to 1.00
April 30, 2000 3.00 to 1.00
July 31, 2000 3.00 to 1.00
October 31, 2000 3.00 to 1.00
January 31, 2001 2.75 to 1.00
April 30, 2001 2.75 to 1.00
July 31, 2001 2.75 to 1.00
October 31, 2001 2.75 to 1.00
Thereafter 2.50 to 1.00
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10.4 Minimum Fixed Charge Coverage Ratio. Borrower shall not permit the
ratio, as of the last day of any fiscal quarter of Borrower, of (a) the sum of
EBITDA, minus cash taxes paid with respect to income, in each case for the four
fiscal quarters ended on such date to (b) the sum of interest expenses plus
current maturities of the Companies' long-term Funded Debt, plus cash dividends
paid by Borrower, plus repurchases by any Company of its own capital stock or
other equity securities (whether or not permitted under Section 9.9), in each
case during the four fiscal quarters ended on such date to be less than the
ratio set forth opposite such day:
October 31, 1998 1.25 to 1.00
January 31, 1999 1.25 to 1.00
April 30, 1999 1.25 to 1.00
July 31, 1999 1.25 to 1.00
October 31, 1999 1.30 to 1.00
January 31, 2000 1.30 to 1.00
April 30, 2000 1.30 to 1.00
July 31, 2000 1.30 to 1.00
Thereafter 1.35 to 1.00
SECTION 11 DEFAULT. The term "DEFAULT" means the occurrence of any one or more
of the following events:
11.1 Payment of Obligation.
(a) The failure of any Company to make any principal payment
on any Note or to pay or reimburse Agent with respect to any draft or
draw request under any LC after it becomes due and payable under the
Loan Documents; or
(b) The failure of any Company to pay any other portion of the
Obligation within three Business Days after it becomes due and payable
under the Loan Documents.
11.2 Covenants. The failure of Borrower (and, if applicable, any other
Company) to punctually and properly perform, observe and comply with:
(a) Any covenant or agreement contained in SECTIONS 2.3(h), 8.1,
8.4 or 9; or
(b) Any other covenant or agreement contained in any Loan
Document (other than the covenants to pay the Obligation and the
covenants in clause (a) above), unless, if such breach is curable, such
breach is cured within 30 days after Borrower knows of such failure.
11.3 Debtor Relief. Any Company (a) is not Solvent, (b) fails to pay
its Debts generally as they become due, (c) voluntarily seeks, consents to, or
acquiesces in the benefit of any Debtor Relief Law, or (d) becomes a party to or
is made the subject of any proceeding provided for by any Debtor Relief Law,
other than as a creditor or claimant, that could suspend or otherwise adversely
affect the Rights of Agent or any
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Lender granted in the Loan Documents (unless, if the proceeding is involuntary,
the applicable petition is dismissed within 60 days after its filing).
11.4 Judgments and Attachments. Any Company fails, within 60 days after
entry, to pay, bond or otherwise discharge any judgment or order for the payment
of money in excess of $1,000,000 (individually or collectively) or any warrant
of attachment, sequestration or similar proceeding against any Company's assets
having a value (individually or collectively) of $1,000,000, which is neither
(a) stayed on appeal nor (b) diligently contested in good faith by appropriate
proceedings and adequate reserves have been set aside on its books in accordance
with GAAP.
11.5 Government Action. (a) A final non-appealable order is issued by
any Tribunal (including, but not limited to, the U.S. Justice Department)
seeking to cause any Company to divest a significant portion of its assets under
any antitrust, restraint of trade, unfair competition, industry regulation or
similar Laws, or (b) any Tribunal condemns, seizes or otherwise appropriates, or
takes custody or control of all or any substantial portion of the assets of any
Company.
11.6 Misrepresentation. Any material representation or warranty made by
any Company contained in any Loan Document at any time proves to have been
materially incorrect when made.
11.7 Ownership of Other Companies. Borrower fails to own, beneficially
and of record, with power to vote, 100% of the issued and outstanding shares of
capital stock of any other Company that has executed a Loan Document (except as
a result of a transaction permitted by this Agreement), or NCI Operating Corp.
and NCI Holding Corp. fail to own the partnership interests described in
SCHEDULE 7.3.
11.8 Default Under Other Agreements. (a) Any Company fails to pay when
due (after lapse of any applicable grace period) any Debt in excess
(individually or collectively) of $1,000,000; (b) any default exists (and is not
waived or cured) under any agreement to which a Company is a party, the effect
of which is to cause, or to permit any Person (other than a Company) to cause,
an amount in excess (individually or collectively) of $1,000,000 to become due
and payable by any Company before its stated maturity; or (c) any Debt in excess
(individually or collectively) of $1,000,000 is declared to be due and payable
(unless such declaration is rescinded) or required to be prepaid by any Company
before its stated maturity.
11.9 LCs. Agent is served with, or becomes subject to, a court order,
injunction, or other process or decree restraining or seeking to restrain it
from paying any amount under any LC and either (a) a drawing has occurred under
the LC and Borrower has refused to reimburse Agent for payment or (b) the
expiration date of the LC has occurred but the right of any beneficiary
thereunder to draw under the LC has been extended past the expiration date in
connection with the pendency of the related court action or proceeding and
Borrower has failed to deposit with Agent cash collateral in an amount equal to
Agent's maximum exposure under the LC.
11.10 Validity and Enforceability of Loan Documents. Except in
accordance with its terms or as otherwise expressly permitted by this Agreement,
any Loan Document at any time after its execution and delivery ceases to be in
full force and effect in any material respect or is declared by a Tribunal to be
null and void or its validity or enforceability is contested by any Company
party thereto or any Company denies that it has any further liability or
obligations under any Loan Document to which it is a party.
11.11 Change of Control. The acquisition by any Person, or two or more
Persons acting in concert (other than any Person or Persons who own, prior to
that acquisition, 20% or more of the outstanding shares
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of Borrower's voting stock), of beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities Exchange
Act of 1934) of 20% or more of the outstanding shares of Borrower's voting
stock.
SECTION 12 RIGHTS AND REMEDIES.
12.1 Remedies Upon Default.
(a) If a Default (i) occurs under SECTION 11.3(c) or (ii)
occurs and is continuing under SECTION 11.3(a), (b) or (d), the
commitment to extend credit under this Agreement automatically
terminates, the entire unpaid balance of the Obligation automatically
becomes due and payable without any action of any kind whatsoever, and
Borrower must provide cash collateral in an amount equal to the
then-existing LC Exposure.
(b) If a Default occurs and is continuing, Agent may (with the
consent of, and must, upon the request of, Determining Lenders), do any
one or more of the following: (i) if the maturity of the Obligation has
not already been accelerated under SECTION 12.1(a), declare the entire
unpaid balance of all or any part of the Obligation immediately due and
payable, whereupon it is due and payable; (ii) terminate the
commitments of Lenders to extend credit under this Agreement; (iii)
reduce any claim to judgment; (iv) to the extent permitted by Law,
exercise (or request each Lender to, and each Lender is entitled to,
exercise) the Rights of offset or banker's Lien against the interest of
any Company in and to every account and other property of any Company
that are in the possession of Agent or any Lender to the extent of the
full amount of the Obligation (and to the extent permitted by Law, each
Company is deemed directly obligated to each Lender in the full amount
of the Obligation for this purpose); (v) demand Borrower to provide
cash collateral in an amount equal to the LC Exposure then existing;
and (vi) exercise any and all other legal or equitable Rights afforded
by the Loan Documents, the Laws of the State of Texas, or any other
applicable jurisdiction.
(c) If Agent refuses to take any action under SECTION 12.1(b)
at the request of Determining Lenders, then Determining Lenders may
take that action.
12.2 Company Waivers. To the extent permitted by Law, each Company
waives presentment and demand for payment, protest, notice of intention to
accelerate, notice of acceleration and notice of protest and nonpayment, and
agrees that its liability with respect to all or any part of the Obligation is
not affected by any renewal or extension in the time of payment of all or any
part of the Obligation, by any indulgence, or by any release or change in any
security for the payment of all or any part of the Obligation.
12.3 Performance by Agent. If any covenant, duty or agreement of any
Company is not performed in accordance with the terms of the Loan Documents,
Agent may, while a Default exists, at its option (but subject to the approval of
Determining Lenders), perform or attempt to perform that covenant, duty or
agreement on behalf of that Company (and any amount expended by Agent in its
performance or attempted performance is payable by the Companies, jointly and
severally, to Agent on demand, becomes part of the Obligation, and bears
interest at the Default Rate from the date of Agent's expenditure until paid).
However, neither Agent nor any Lender assumes or shall have, except by its
express written consent, any liability or responsibility for the performance of
any covenant, duty or agreement of any Company.
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12.4 Not in Control. None of the covenants or other provisions
contained in any Loan Document shall, or shall be deemed to, give Agent or
Lenders the Right to exercise control over the assets (including, without
limitation, real property), affairs, or management of any Company; the power of
Agent and Lenders is limited to the Right to exercise the remedies provided in
this SECTION 12.
12.5 Course of Dealing. The acceptance by Agent or Lenders of any
partial payment on the Obligation shall not be deemed to be a waiver of any
Default then existing. No waiver by Agent, Determining Lenders or Lenders of any
Default shall be deemed to be a waiver of any other then-existing or subsequent
Default. No delay or omission by Agent, Determining Lenders or Lenders in
exercising any Right under the Loan Documents will impair that Right or be
construed as a waiver thereof or any acquiescence therein, nor will any single
or partial exercise of any Right preclude other or further exercise thereof or
the exercise of any other Right under the Loan Documents or otherwise.
12.6 Cumulative Rights. All Rights available to Agent, Determining
Lenders, and Lenders under the Loan Documents are cumulative of and in addition
to all other Rights granted to Agent, Determining Lenders, and Lenders at law or
in equity, whether or not the Obligation is due and payable and whether or not
Agent, Determining Lenders, or Lenders have instituted any suit for collection,
foreclosure, or other action in connection with the Loan Documents.
12.7 Application of Proceeds. Any and all proceeds ever received by
Agent or Lenders from the exercise of any Rights pertaining to the Obligation
shall be applied to the Obligation according to SECTION 3.11.
12.8 Diminution in Value of Collateral. Neither Agent nor any Lender
has any liability or responsibility whatsoever for any diminution in or loss of
value of any collateral now or hereafter securing payment or performance of all
or any part of the Obligation (other than diminution in or loss of value caused
by its gross negligence or willful misconduct).
12.9 Certain Proceedings. Borrower will promptly execute and deliver,
or cause the execution and delivery of, all applications, certificates,
instruments, registration statements and all other documents and papers Agent or
Determining Lenders reasonably request in connection with the obtaining of any
consent, approval, registration, qualification, permit, license or authorization
of any Tribunal or other Person necessary or appropriate for the effective
exercise of any Rights under the Loan Documents. Because Borrower agrees that
Agent's and Determining Lenders' remedies at Law for failure of Borrower to
comply with the provisions of this paragraph would be inadequate and that
failure would not be adequately compensable in damages, Borrower agrees that the
covenants of this paragraph may be specifically enforced.
SECTION 13 AGREEMENT AMONG LENDERS.
13.1 Appointment, Powers, and Immunities of Agent. Each Lender hereby
irrevocably appoints and authorizes Agent to act as its agent under the Loan
Documents with such powers and discretion as are specifically delegated to Agent
by the terms of the Loan Documents, together with such other powers as are
reasonably incidental thereto. Agent (which term as used in this sentence and in
SECTION 13.5 and the first sentence of SECTION 13.6 shall include its Affiliates
and its own and its Affiliates' officers, directors, employees, and agents): (a)
shall not have any duties or responsibilities except those expressly set forth
in this Agreement and shall not be a trustee or fiduciary for any Lender; (b)
shall not be responsible to Lenders for any recital, statement, representation,
or warranty (whether written or oral) made in or in connection with any Loan
Document or any certificate or other document referred to or provided for in, or
received by any
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of them under, any Loan Document, or for the value, validity, effectiveness,
genuineness, enforceability, or sufficiency of any Loan Document, or any other
document referred to or provided for therein or for any failure by any Company
or any other Person to perform any of its obligations thereunder; (c) shall not
be responsible for or have any duty to ascertain, inquire into, or verify the
performance or observance of any covenants or agreements by any Company or the
satisfaction of any condition or to inspect the property (including the books
and records) of any Company; (d) shall not be required to initiate or conduct
any litigation or collection proceedings under any Loan Document; and (e) shall
not be responsible for any action taken or omitted to be taken by it under or in
connection with any Loan Document, except for its own gross negligence or
willful misconduct. Agent may employ agents and attorneys-in-fact and shall not
be responsible for the negligence or misconduct of any such agents or
attorneys-in-fact selected by it with reasonable care.
13.2 Reliance by Agent. Agent shall be entitled to rely upon any
certification, notice, instrument, writing, or other communication (including,
without limitation, any thereof by telephone or telecopy) believed by it to be
genuine and correct and to have been signed, sent or made by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel
(including counsel for any Company), independent accountants, and other experts
selected by Agent. Agent may deem and treat the payee of any Note as the holder
thereof for all purposes hereof unless and until Agent receives and accepts an
Assignment and Acceptance executed in accordance with SECTION 14.12. As to any
matters not expressly provided for by this Agreement, Agent shall not be
required to exercise any discretion or take any action, but shall be required to
act or to refrain from acting (and shall be fully protected in so acting or
refraining from acting) upon the instructions of Determining Lenders, and such
instructions shall be binding on all Lenders; provided, however, that Agent
shall not be required to take any action that exposes Agent to personal
liability or that is contrary to any Loan Document or applicable Law or unless
it shall first be indemnified to its satisfaction by Lenders against any and all
liability and expense which may be incurred by it by reason of taking any such
action.
13.3 Defaults. Agent shall not be deemed to have knowledge or notice of
the occurrence of a Default or Potential Default unless Agent has received
written notice from a Lender or Borrower specifying such Default or Potential
Default and stating that such notice is a "Notice of Default". In the event that
Agent receives such a notice of the occurrence of a Default or Potential
Default, Agent shall give prompt notice thereof to Lenders. Agent shall (subject
to SECTION 13.2) take such action with respect to such Default or Potential
Default as shall reasonably be directed by Determining Lenders, provided that,
unless and until Agent shall have received such directions, Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with
respect to such Default or Potential Default as it shall deem advisable in the
best interest of Lenders.
13.4 Rights as Lender. With respect to its Commitments and the Loans
made by it, NationsBank (and any successor acting as Agent) in its capacity as a
Lender hereunder shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not acting as Agent, and the
term "Lender" or "Lenders" shall, unless the context otherwise indicates,
include Agent in its individual capacity. NationsBank (and any successor acting
as Agent) and its Affiliates may (without having to account therefor to any
Lender) accept deposits from, lend money to, make investments in, provide
services to, and generally engage in any kind of lending, trust, or other
business with any Company as if it were not acting as Agent, and NationsBank
(and any successor acting as Agent) and its Affiliates may accept fees and other
consideration from any Company for services in connection with this Agreement or
otherwise without having to account for the same to Lenders.
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13.5 Indemnification. LENDERS AGREE TO INDEMNIFY AGENT (TO THE EXTENT
NOT REIMBURSED UNDER SECTION 14.12, BUT WITHOUT LIMITING THE OBLIGATIONS OF
BORROWER UNDER SUCH SECTION) RATABLY IN ACCORDANCE WITH THEIR RESPECTIVE
COMMITMENTS, FOR ANY AND ALL LIABILITIES, OBLIGATIONS, LOSSES, DAMAGES,
PENALTIES, ACTIONS, JUDGMENTS, SUITS, COSTS, EXPENSES (INCLUDING ATTORNEYS'
FEES), OR DISBURSEMENTS OF ANY KIND AND NATURE WHATSOEVER THAT MAY BE IMPOSED
ON, INCURRED BY OR ASSERTED AGAINST AGENT (INCLUDING BY ANY LENDER) IN ANY WAY
RELATING TO OR ARISING OUT OF ANY LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
THEREBY OR ANY ACTION TAKEN OR OMITTED BY AGENT UNDER ANY LOAN DOCUMENT
(INCLUDING ANY OF THE FOREGOING ARISING FROM THE NEGLIGENCE OF AGENT); PROVIDED
THAT NO LENDER SHALL BE LIABLE FOR ANY OF THE FOREGOING TO THE EXTENT THEY ARISE
FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF THE PERSON TO BE INDEMNIFIED.
WITHOUT LIMITATION OF THE FOREGOING, EACH LENDER AGREES TO REIMBURSE AGENT
PROMPTLY UPON DEMAND FOR ITS RATABLE SHARE OF ANY COSTS OR EXPENSES PAYABLE BY
BORROWER UNDER SECTION 8.7, TO THE EXTENT THAT AGENT IS NOT PROMPTLY REIMBURSED
FOR SUCH COSTS AND EXPENSES BY BORROWER. THE AGREEMENTS CONTAINED IN THIS
SECTION 13.5 SHALL SURVIVE PAYMENT IN FULL OF THE LOANS AND ALL OTHER AMOUNTS
PAYABLE UNDER THIS AGREEMENT.
13.6 Non-Reliance on Agent and Other Lenders. Each Lender agrees that
it has, independently and without reliance on Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own credit analysis of the Companies and decision to enter into this Agreement
and that it will, independently and without reliance upon Agent or any other
Lender, and based on such documents and information as it shall deem appropriate
at the time, continue to make its own analysis and decisions in taking or not
taking action under the Loan Documents. Except for notices, reports, and other
documents and information expressly required to be furnished to Lenders by Agent
hereunder, Agent shall not have any duty or responsibility to provide any Lender
with any credit or other information concerning the affairs, financial
condition, or business of any Company that may come into the possession of Agent
or any of its Affiliates.
13.7 Resignation of Agent. Agent may resign at any time by giving
notice thereof to Lenders and Borrower. Upon any such resignation, Determining
Lenders shall have the right to appoint a successor Agent with the consent of
Borrower (which consent shall not unreasonably be withheld). If no successor
Agent shall have been so appointed by Determining Lenders and shall have
accepted such appointment within 30 days after the retiring Agent's giving of
notice of resignation, then the retiring Agent may, on behalf of Lenders,
appoint a successor Agent which shall be a commercial bank organized under the
laws of the U.S. having combined capital and surplus of at least $100,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor, such
successor shall thereupon succeed to and become vested with all the rights,
powers, discretion, privileges, and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations hereunder.
After any retiring Agent's resignation hereunder as Agent, the provisions of
this SECTION 13 shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as Agent.
13.8 Relationship of Lenders. The Loan Documents, and the documents
delivered in connection therewith, do not create a partnership or joint venture
among Agent and Lenders or among Lenders.
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13.9 Collateral Matters.
(a) Each Lender authorizes and directs Agent to enter into the
Security Documents for the ratable benefit of Lenders. Each Lender
agrees that any action taken by Agent concerning any Collateral with
the consent of, or at the request of, Determining Lenders in accordance
with the provisions of this Agreement, the Security Documents or the
other Loan Documents, and the exercise by Agent (with the consent of,
or at the request of, Determining Lenders) of powers concerning the
Collateral set forth in any Loan Document, together with other
reasonably incidental powers, shall be authorized and binding upon all
Lenders.
(b) Agent is authorized on behalf of all Lenders, without the
necessity of any notice to or further consent from any Lender, from
time to time before a Default or Potential Default, to take any action
with respect to any Collateral or Security Documents that may be
necessary to perfect and maintain perfected the Lender Liens upon the
Collateral granted by the Security Documents.
(c) Agent has no obligation whatsoever to any Lender or to any
other Person to assure that the Collateral exists or is owned by any
Company or is cared for, protected or insured or has been encumbered or
that the Liens granted to Agent for the benefit of Lenders under the
Security Documents have been properly or sufficiently or lawfully
created, perfected, protected or enforced, or are entitled to any
particular priority.
(d) Agent shall exercise the same care and prudent judgment with
respect to the Collateral and the Security Documents as it normally and
customarily exercises in respect of similar collateral and security
documents.
(e) Lenders irrevocably authorize Agent, at its option and in its
discretion, to release any Lender Lien upon any Collateral (i) upon
full payment of the Obligation; (ii) constituting property being sold
or disposed of as permitted under SECTION 9.10, if Agent determines
that the property being sold or disposed is being sold or disposed in
accordance with the requirements and limitations of SECTION 9.10 and
Agent concurrently receives all mandatory prepayments with respect
thereto, if any, in accordance with SECTION 9.10; or (iii) if approved,
authorized or ratified in writing by Determining Lenders, subject to
SECTION 14.10(a)(v). Upon request by Agent at any time, Lenders will
confirm in writing Agent's authority to release particular types or
items of Collateral under this SECTION 13.9(e).
13.10 Benefits of Agreement. None of the provisions of this SECTION 13
inure to the benefit of any Company or any other Person other than Agent and
Lenders; consequently, no Company or any other Person is entitled to rely upon,
or to raise as a defense, in any manner whatsoever, the failure of Agent or any
Lender to comply with these provisions.
SECTION 14 MISCELLANEOUS.
14.1 Headings. The headings, captions and arrangements used in any of
the Loan Documents are, unless specified otherwise, for convenience only and
shall not be deemed to limit, amplify or modify the terms of the Loan Documents,
nor affect the meaning thereof.
14.2 Nonbusiness Days; Time. Any payment or action that is due under
any Loan Document on a non-Business Day may be delayed until the next-succeeding
Business Day (but interest shall continue to
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accrue on any applicable payment until payment is in fact made) unless the
payment concerns a Eurodollar Loan, in which case if the next-succeeding
Business Day is in the next calendar month, then such payment shall be made on
the next-preceding Business Day. Unless otherwise indicated, all time references
(e.g., 10:00 a.m.) are to Dallas, Texas time.
14.3 Communications. Unless otherwise specifically provided, whenever
any Loan Document requires or permits any consent, approval, notice, request,
demand or other communication from one party to another, communication must be
in writing (which may be by telex or telecopy) to be effective and shall be
deemed to have been given (a) if by telex, when transmitted to the appropriate
telex number and the appropriate answerback is received, (b) if by telecopy,
when transmitted to the appropriate telecopy number (and all communications sent
by telecopy must be confirmed promptly thereafter by telephone; but any
requirement in this parenthetical shall not affect the date when the telecopy
shall be deemed to have been delivered), (c) if by mail, on the third Business
Day after it is enclosed in an envelope and properly addressed, stamped, sealed,
certified mail, return receipt requested, and deposited in the appropriate
official postal service, or (d) if by any other means, when actually delivered.
Until changed by notice pursuant to this Agreement, the address (and telecopy
number) for Agent, Borrower and each Guarantor is set forth on SCHEDULE 1.
14.4 Form and Number of Documents. The form, substance, and number of
counterparts of each writing to be furnished under this Agreement must be
satisfactory to Agent and its counsel.
14.5 Exceptions to Covenants. Borrower may not and may not permit any
Company to take or fail to take any action that is permitted as an exception to
any of the covenants contained in this Agreement if that action or omission
would result in the breach of any other covenant contained in this Agreement.
14.6 Survival. All covenants, agreements, undertakings, representations
and warranties made in any of the Loan Documents survive all closings under the
Loan Documents and, except as otherwise indicated, are not affected by any
investigation made by any party.
14.7 Governing Law. Except as expressly provided in a Loan Document,
the Laws (other than conflict-of-laws provisions) of the State of Texas and of
the U.S. govern the Rights and duties of the parties to the Loan Documents and
the validity, construction, enforcement and interpretation of the Loan
Documents.
14.8 Invalid Provisions. Any provision in any Loan Document held to be
illegal, invalid or unenforceable is fully severable; the appropriate Loan
Document shall be construed and enforced as if that provision had never been
included; and the remaining provisions shall remain in full force and effect and
shall not be affected by the severed provision. Agent, Lenders, and each Company
party to the affected Loan Document agree to negotiate, in good faith, the terms
of a replacement provision as similar to the severed provision as may be
possible and be legal, valid and enforceable. However, if the provision held to
be illegal, invalid or unenforceable is a material part of this Agreement, such
invalid, illegal or unenforceable provision shall be, to the extent permitted by
Law, replaced by a clause or provision judicially construed and interpreted to
be as similar in substance and content to the original terms of such illegal,
invalid or unenforceable clause or provision as the context thereof would
reasonably allow, so that such clause or provision would thereafter be legal,
valid and enforceable.
14.9 Venue; Service of Process; Jury Trial. EACH PARTY TO ANY LOAN
DOCUMENT, IN EACH CASE FOR ITSELF, ITS SUCCESSORS AND ASSIGNS (AND IN THE CASE
OF BORROWER,
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FOR EACH OTHER COMPANY), (a) IRREVOCABLY SUBMITS TO THE NONEXCLUSIVE
JURISDICTION OF THE STATE AND FEDERAL COURTS OF THE STATE OF TEXAS, (b)
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY LITIGATION ARISING
OUT OF OR IN CONNECTION WITH THE LOAN DOCUMENTS AND THE OBLIGATION BROUGHT IN
DISTRICT COURTS OF DALLAS OR XXXXXX COUNTY, TEXAS, OR IN THE U.S. DISTRICT COURT
FOR THE NORTHERN OR SOUTHERN DISTRICT OF TEXAS, DALLAS OR HOUSTON DIVISION, (c)
IRREVOCABLY WAIVES ANY CLAIMS THAT ANY LITIGATION BROUGHT IN ANY OF THE
AFOREMENTIONED COURTS HAS BEEN BROUGHT IN AN INCONVENIENT FORUM, (d) IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THOSE COURTS IN ANY LITIGATION
BY THE MAILING OF COPIES THEREOF BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED,
POSTAGE PREPAID, BY HAND-DELIVERY, OR BY DELIVERY BY A NATIONALLY RECOGNIZED
COURIER SERVICE, AND SERVICE SHALL BE DEEMED COMPLETE UPON DELIVERY OF THE LEGAL
PROCESS AT ITS ADDRESS SET FORTH IN THIS AGREEMENT, (e) IRREVOCABLY AGREES THAT
ANY LEGAL PROCEEDING AGAINST ANY PARTY TO ANY LOAN DOCUMENT ARISING OUT OF OR IN
CONNECTION WITH THE LOAN DOCUMENTS OR THE OBLIGATION MAY BE BROUGHT IN ONE OF
THE AFOREMENTIONED COURTS, AND (f) IRREVOCABLY WAIVES TO THE FULLEST EXTENT
PERMITTED BY LAW, ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF ANY LOAN DOCUMENT. The scope of each of the
foregoing waivers 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. Borrower (for
itself and on behalf of each other Company) acknowledges that these waivers are
a material inducement to Agent's and each Lender's agreement to enter into a
business relationship, that Agent and each Lender has already relied on these
waivers in entering into this Agreement, and that Agent and each Lender will
continue to rely on each of these waivers in related future dealings. Borrower
(for itself and on behalf of each other Company) further warrants and represents
that it has reviewed these waivers with its legal counsel, and that it knowingly
and voluntarily agrees to each waiver following consultation with legal counsel.
THE WAIVERS IN THIS SECTION 14.9 ARE IRREVOCABLE, MEANING THAT THEY MAY NOT BE
MODIFIED EITHER ORALLY OR IN WRITING, AND THESE WAIVERS SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, SUPPLEMENTS, OR REPLACEMENTS TO OR OF THIS OR ANY OTHER
LOAN DOCUMENT. In the event of Litigation, this Agreement may be filed as a
written consent to a trial by the court.
14.10 Amendments, Consents, Conflicts and Waivers.
(a) Any provision of any Loan Document may be amended or
waived if, but only if, such amendment or waiver is in writing and is
signed by Borrower and Determining Lenders (and, if SECTION 13 or the
rights or duties of Agent are affected thereby, by Agent); provided
that no such amendment or waiver shall, unless signed by all Lenders,
(i) increase the Commitments, (ii) reduce the principal of or rate of
interest on any Loan or any fees or other amounts payable hereunder,
(iii) postpone any date fixed for the payment of any scheduled
installment of principal of or interest on any Loan or any fees or
other amounts payable hereunder or for termination of any Commitment,
(iv) change the percentage of the Commitments or of the unpaid
principal amount of the Notes, or the number of Lenders, which shall be
required for Lenders or any of them to take any action under this
SECTION 14.10 or any other provision of this Agreement or (v) release
any Guarantor or all or substantially all of the Collateral.
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(b) Any conflict or ambiguity between the terms and provisions
of this Agreement and terms and provisions in any other Loan Document
is controlled by the terms and provisions of this Agreement.
(c) No course of dealing or any failure or delay by Agent, any
Lender, or any of their respective Representatives with respect to
exercising any Right of Agent or any Lender under this Agreement
operates as a waiver thereof. A waiver must be in writing and signed by
Agent and Lenders (or Determining Lenders, if permitted under this
Agreement) to be effective, and a waiver will be effective only in the
specific instance and for the specific purpose for which it is given.
14.11 Multiple Counterparts. Any Loan Document may be executed in a
number of identical counterparts, each of which shall be deemed an original for
all purposes and all of which constitute, collectively, one agreement; but, in
making proof of thereof, it shall not be necessary to produce or account for
more than one counterpart. Each Lender need not execute the same counterpart of
this Agreement so long as identical counterparts are executed by Borrower, each
Lender, and Agent. This Agreement shall become effective when counterparts of
this Agreement have been executed and delivered to Agent by each Lender, Agent
and Borrower, or, in the case only of Lenders, when Agent has received
telecopied, telexed or other evidence satisfactory to it that each Lender has
executed and is delivering to Agent a counterpart of this Agreement.
14.12 Successors and Assigns; Assignments and Participations.
(a) Each Loan Document binds and inures to the benefit of the
parties thereto, any intended beneficiary thereof, and each of their
respective successors and permitted assigns. No Lender may transfer,
pledge, assign, sell any participation in, or otherwise encumber its
portion of the Obligation except as permitted by this SECTION 14.12.
(b) Each Lender may assign to one or more financial institutions
approved by Borrower and Agent (which approval shall not be
unreasonably withheld) (each a "PURCHASER") all or a portion of its
rights and obligations under this Agreement (including, without
limitation, all or a portion of its Loans, its Notes, and its
Commitments); provided, however, that
(i) except in the case of an assignment to another Lender
or an assignment of all of a Lender's rights and obligations
under this Agreement, any such partial assignment shall be in an
amount at least equal to $10,000,000 or an integral multiple of
$1,000,000 in excess thereof;
(ii) each such assignment by a Lender shall be of a
constant, and not varying, percentage of all of its rights and
obligations under this Agreement and the Notes; and
(iii) the parties to such assignment shall execute and
deliver to Agent for its acceptance an Assignment and Acceptance
in the form of EXHIBIT I, together with any Note subject to such
assignment and a processing fee of $3,500.
Upon execution, delivery, and acceptance of such Assignment and
Acceptance, the assignee thereunder shall be a party hereto and, to the
extent of such assignment, have the obligations, rights, and benefits
of a Lender hereunder and the assigning Lender shall, to the extent of
such assignment, relinquish its rights and be released from its
obligations under this Agreement. Upon the
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consummation of any assignment pursuant to this SECTION 14.12(b), the
assignor, Agent and Borrower shall make appropriate arrangements so
that, if required, new Notes are issued to the assignor and the
assignee. If the assignee is not incorporated under the laws of the
U.S. or a state thereof, it shall deliver to Borrower and Agent
certification as to exemption from deduction or withholding of Taxes in
accordance with SECTION 3.20.
(c) Agent shall maintain at its address referred to in SECTION
14.3 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of
Lenders and the Commitments of, and principal amount of the Loans owing
to, each Lender from time to time (the "REGISTER"). The entries in the
Register shall be conclusive and binding for all purposes, absent
manifest error, and Borrower, Agent and Lenders may treat each Person
whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for
inspection by Borrower or any Lender at any reasonable time and from
time to time upon reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance executed by
the parties thereto, together with any Note subject to such assignment
and payment of the processing fee, Agent shall, if such Assignment and
Acceptance has been completed and is in substantially the form of
EXHIBIT I, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt
notice thereof to the parties thereto.
(e) Each Lender may sell participations to one or more Persons in
all or a portion of its rights, obligations or rights and obligations
under this Agreement (including all or a portion of its Commitments or
its Loans); provided, however, that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of
such obligations, (iii) the Participant shall be entitled to the
benefit of the yield protection provisions contained in SECTIONS 3.15
through 3.20 (however, no Participant is entitled to receive any
greater payment than the transferor Lender would have been entitled to
receive) and the right of set-off contained in SECTION 3.12, and (iv)
Borrower shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this
Agreement, and such Lender shall retain the sole right to enforce the
obligations of Borrower relating to its Loans and its Notes and to
approve any amendment, modification, or waiver of any provision of this
Agreement (other than amendments, modifications, or waivers decreasing
the amount of principal of or the rate at which interest is payable on
such Loans or Notes, extending any scheduled principal payment date or
date fixed for the payment of interest on such Loans or Notes, or
extending its Commitments).
(f) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time assign and pledge all or any
portion of its Loans and its Notes to any Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank. No such assignment shall release
the assigning Lender from its obligations hereunder.
(g) Any Lender may furnish any information concerning Borrower
or any of its Subsidiaries in the possession of such Lender from time
to time to Purchasers and Participants (including prospective
Purchasers and Participants).
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14.13 Discharge Only Upon Payment in Full; Reinstatement in Certain
Circumstances. Each Company's obligations under the Loan Documents remain in
full force and effect until the Total Commitment is terminated and the
Obligation is paid in full (except for provisions under the Loan Documents which
by their terms expressly survive payment of the Obligation and termination of
the Loan Documents). If at any time any payment of the principal of or interest
on any Note or any other amount payable by Borrower or any other obligor on the
Obligation under any Loan Document is rescinded or must be restored or returned
upon the insolvency, bankruptcy or reorganization of Borrower or otherwise, the
obligations of each Company under the Loan Documents with respect to that
payment shall be reinstated as though the payment had been due but not made at
that time.
14.14 ENTIRETY. THIS AGREEMENT AND THE OTHER WRITTEN LOAN DOCUMENTS
(EACH AS AMENDED IN WRITING FROM TIME TO TIME) EXECUTED BY ANY COMPANY, ANY
LENDER OR AGENT REPRESENT THE FINAL AGREEMENT AMONG THE COMPANIES, LENDERS AND
AGENT AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR
SUBSEQUENT ORAL AGREEMENTS BY THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.
EXECUTED as of the day and year first mentioned.
NCI BUILDING SYSTEMS, INC.
as Borrower
By: /s/ Xxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxx X. Xxxxxxx
Vice President and Chief Financial Officer
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NATIONSBANK OF TEXAS, N.A.,
as Administrative Agent and a Lender
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
----------------------------------------
Xxxxxxx X. Xxxxxxx, Xx.
Vice President
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NATIONSBANC XXXXXXXXXX SECURITIES
LLC, as Arranger and Syndication Agent
By: /s/ Xxxx X. Xxxx
-----------------------------------------
Xxxx X. Xxxx
Managing Director
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SWISS BANK CORPORATION,
STAMFORD BRANCH
as Documentation Agent and a Lender
By: /s/ Xxxxxxx XxXxxxxx
-----------------------------------------
Name: Xxxxxxx XxXxxxxx
Title: Associate Director Loan Portfolio Support, US
By: /s/ Xxxx Xxxxx
-----------------------------------------
Name: Xxxx Xxxxx
Title: Director, Banking Finance
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