1
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$275,000,000
CREDIT AGREEMENT
among
XXX RIVER INC.,
as Borrower
CERTAIN OF ITS DOMESTIC SUBSIDIARIES
FROM TIME TO TIME PARTIES HERETO
as Guarantors,
THE LENDERS PARTIES HERETO
and
FIRST UNION NATIONAL BANK,
as Administrative Agent
THE FIRST NATIONAL BANK OF CHICAGO,
as Syndication Agent
and
WACHOVIA BANK, N.A.
as Documentation Agent
Dated as of October 14, 1998
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS 1
Section 1.1 Defined Terms 1
Section 1.2 Other Definitional Provisions 22
Section 1.3 Accounting Terms 23
ARTICLE II THE LOANS; AMOUNT AND TERMS 23
Section 2.1 Revolving Loans 23
Section 2.2 Term Loan 25
Section 2.3 Swingline Loan Subfacility 27
Section 2.4 Letter of Credit Subfacility 29
Section 2.5 Fees 32
Section 2.6 Commitment Reductions 33
Section 2.7 Prepayments 33
Section 2.8 Minimum Principal Amount of Tranches 35
Section 2.9 Default Rate and Payment Dates 35
Section 2.10 Conversion Options 35
Section 2.11 Computation of Interest and Fees 36
Section 2.12 Pro Rata Treatment and Payments 36
Section 2.13 Non-Receipt of Funds by the Administrative Agent 37
Section 2.14 Inability to Determine Interest Rate 38
Section 2.15 Illegality 38
Section 2.16 Requirements of Law 39
Section 2.17 Indemnity 40
Section 2.18 Taxes 41
Section 2.19 Indemnification; Nature of Issuing Lender's Duties 43
Section 2.20 Replacement of Lender 44
ARTICLE III REPRESENTATIONS AND WARRANTIES 45
Section 3.1 Financial Condition 45
Section 3.2 No Change 45
Section 3.3 Corporate Existence; Compliance with Law 45
Section 3.4 Corporate Power; Authorization; Enforceable
Obligations 45
Section 3.5 No Legal Bar; No Default 46
Section 3.6 No Material Litigation 46
Section 3.7 Investment Company Act 46
Section 3.8 Margin Regulations 46
Section 3.9 ERISA 47
Section 3.10 Environmental Matters 47
Section 3.11 Purpose of Loans 48
Section 3.12 Subsidiaries 48
Section 3.13 Ownership 49
Section 3.14 Indebtedness 49
Section 3.15 Taxes 49
Section 3.16 Intellectual Property 49
Section 3.17 Solvency 50
Section 3.18 Investments 50
Section 3.19 Location of Collateral 50
Section 3.20 No Burdensome Restrictions 50
Section 3.21 Brokers' Fees 50
Section 3.22 Labor Matters 50
Section 3.23 Accuracy and Completeness of Information 50
Section 3.24 Year 2000 Issue 51
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ARTICLE IV CONDITIONS PRECEDENT 51
Section 4.1 Conditions to Closing Date and Initial Revolving
Loans and Term Loans 51
Section 4.2 Conditions to All Extensions of Credit 54
ARTICLE V AFFIRMATIVE COVENANTS 55
Section 5.1 Financial Statements 55
Section 5.2 Certificates; Other Information 56
Section 5.3 Payment of Obligations 57
Section 5.4 Conduct of Business and Maintenance of Existence 58
Section 5.5 Maintenance of Property; Insurance 58
Section 5.6 Inspection of Property; Books and Records;
Discussions 58
Section 5.7 Notices 59
Section 5.8 Environmental Laws 60
Section 5.9 Financial Covenants 61
Section 5.10 Additional Subsidiary Guarantors 61
Section 5.1 Compliance with Law 61
Section 5.12 Pledged Assets 61
Section 5.13 Year 2000 Compliance 62
Section 5.14 Canadian Collateral 62
ARTICLE VI NEGATIVE COVENANTS 62
Section 6.1 Indebtedness 62
Section 6.2 Liens 64
Section 6.3 Guaranty Obligations 64
Section 6.4 Nature of Business 64
Section 6.5 Consolidation, Merger, Sale or Purchase of
Assets, etc. 64
Section 6.6 Advances, Investments and Loans 65
Section 6.7 Transactions with Affiliates 65
Section 6.8 Ownership of Subsidiaries; Restrictions 66
Section 6.9 Fiscal Year; Organizational Documents; Material
Contracts 66
Section 6.10 Limitation on Restricted Actions 66
Section 6.1 Restricted Payments 67
Section 6.12 Prepayments of Indebtedness, etc. 67
Section 6.13 Sale Leasebacks 67
Section 6.14 No Further Negative Pledges 67
ARTICLE VII EVENTS OF DEFAULT 68
Section 7.1 Events of Default 68
Section 7.2 Acceleration; Remedies 70
ARTICLE VIII THE ADMINISTRATIVE AGENT 71
Section 8.1 Appointment. 71
Section 8.2 Delegation of Duties 71
Section 8.3 Exculpatory Provisions 72
Section 8.4 Reliance by Administrative Agent 72
Section 8.5 Notice of Default 72
Section 8.6 Non-Reliance on Administrative Agent and Other
Lenders 73
Section 8.7 Indemnification 73
Section 8.8 Administrative Agent in Its Individual Capacity 74
Section 8.9 Successor Administrative Agent 74
Section 8.10 Syndication Agent and Documentation Agent 74
ARTICLE IX MISCELLANEOUS 75
Section 9.1 Amendments, Waivers and Release of Collateral 75
Section 9.2 Notices 76
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Section 9.3 No Waiver; Cumulative Remedies 78
Section 9.4 Survival of Representations and Warranties 78
Section 9.5 Payment of Expenses and Taxes 78
Section 9.6 Successors and Assigns; Participations;
Purchasing Lenders 79
Section 9.7 Adjustments; Set-off 81
Section 9.8 Table of Contents and Section Headings 83
Section 9.9 Counterparts 83
Section 9.10 Effectiveness 83
Section 9.11 Severability 83
Section 9.12 Integration 83
Section 9.13 Governing Law 83
Section 9.14 Consent to Jurisdiction and Service of Process 84
Section 9.15 Arbitration 84
Section 9.16 Confidentiality 85
Section 9.17 Acknowledgments 86
Section 9.18 Waivers of Jury Trial 87
Section 9.19 Conflict 86
ARTICLE X GUARANTY 87
Section 10.1 The Guaranty 87
Section 10.2 Bankruptcy 87
Section 10.3 Nature of Liability 88
Section 10.4 Independent Obligation 88
Section 10.5 Authorization 88
Section 10.6 Reliance 89
Section 10.7 Waiver 89
Section 10.8 Limitation on Enforcement 90
Section 10.9 Confirmation of Payment 90
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Schedules
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Schedule 1.1(a) Account Designation Letter
Schedule 2.1(a) Schedule of Lenders and Commitments
Schedule 2.1(b)(i) Form of Notice of Borrowing
Schedule 2.1(e) Form of Revolving Note
Schedule 2.2(d) Form of Term Note
Schedule 2.3(d) Form of Swingline Note
Schedule 2.10 Form of Notice of Conversion/Extension
Schedule 2.18 Section 2.18 Certificate
Schedule 3.6 Litigation
Schedule 3.9 ERISA
Schedule 3.10 Environmental Matters
Schedule 3.12 Subsidiaries
Schedule 3.16 Intellectual Property
Schedule 3.19(a) Location of Real Property
Schedule 3.19(b) Location of Collateral
Schedule 3.19(c) Chief Executive Offices
Schedule 3.22 Labor Matters
Schedule 4.1(b) Form of Secretary's Certificate
Schedule 4.1(h) Form of Solvency Certificate
Schedule 5.5(b) Insurance
Schedule 5.10 Form of Joinder Agreement
Schedule 6.1(b) Indebtedness
Schedule 6.2 Liens
Schedule 9.2 Schedule of Lenders' Lending Offices
Schedule 9.6(c) Form of Commitment Transfer Supplement
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CREDIT AGREEMENT, dated as of October 14, 1998, among XXX RIVER INC., a
Georgia corporation (the "Borrower"), those Domestic Subsidiaries of the
Borrower identified as a "Guarantor" on the signature pages hereto and such
other Domestic Subsidiaries of the Borrower as may from time to time become a
party hereto (collectively, the "Guarantors"), the several banks and other
financial institutions as may from time to time become parties to this Agreement
(collectively, the "Lenders"; and individually, a "Lender"), FIRST UNION
NATIONAL BANK, a national banking association, as administrative agent for the
Lenders hereunder (in such capacity, the "Administrative Agent"), THE FIRST
NATIONAL BANK OF CHICAGO, as Syndication Agent, and WACHOVIA BANK, N.A., as
Documentation Agent.
W I T N E S S E T H:
WHEREAS, the Borrower has requested that the Lenders make loans and other
financial accommodations to the Borrower in the amount of up to $275,000,000, as
more particularly described herein;
WHEREAS, the Lenders have agreed to make such loans and other financial
accommodations to the Borrower on the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Defined Terms.
As used in this Agreement, terms defined in the preamble to this
Agreement have the meanings therein indicated, and the following terms have the
following meanings:
"Account Designation Letter" shall mean the Notice of Account Designation
Letter dated the Closing Date from the Borrower to the Administrative Agent
substantially in the form attached hereto as Schedule 1.1(a).
"Acquired Business" shall mean The Xxxx Company, a Delaware corporation.
"Acquisition" shall mean the purchases, contributions and other
acquisitions of assets contemplated by the Acquisition Documents.
"Acquisition Documents" shall mean the Agreement and Plan of Merger dated
as of June 28, 1998, between Borrower and The Xxxx Company, as amended, together
with exhibits and schedules thereto, and all documents, instruments,
certificates and agreements identified therein and required to be executed or
exchanged by or between the parties thereto pursuant thereto or in connection
therewith.
"Additional Credit Party" shall mean each Person that becomes a Guarantor
by execution of a Joinder Agreement in accordance with Section 5.10.
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"Administrative Agent" shall have the meaning set forth in the first
paragraph of this Agreement and any successors in such capacity.
"Affiliate" shall mean as to any Person, any other Person (excluding any
Subsidiary) which, directly or indirectly, is in control of, is controlled by,
or is under common control with, such Person. For purposes of this definition, a
Person shall be deemed to be "controlled by" a Person if such Person possesses,
directly or indirectly, power either (a) to vote 10% or more of the securities
having ordinary voting power for the election of directors of such Person or (b)
to direct or cause the direction of the management and policies of such Person
whether by contract or otherwise.
"Agreement" shall mean this Credit Agreement, as amended, modified or
supplemented from time to time in accordance with its terms.
"Alternate Base Rate" shall mean, for any day, a rate per annum equal to
the greater of (a) the Prime Rate in effect on such day and (b) the Federal
Funds Effective Rate in effect on such day plus 1/2 of 1%. For purposes hereof:
"Prime Rate" shall mean, at any time, the rate of interest per annum publicly
announced from time to time by First Union at its principal office in Charlotte,
North Carolina as its prime rate. Each change in the Prime Rate shall be
effective as of the opening of business on the day such change in the Prime Rate
occurs. The parties hereto acknowledge that the rate announced publicly by First
Union as its Prime Rate is an index or base rate and shall not necessarily be
its lowest or best rate charged to its customers or other banks; and "Federal
Funds Effective Rate" shall mean, for any day, the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is not so
published on the next succeeding Business Day, the average of the quotations for
the day of such transactions received by the Administrative Agent from three
federal funds brokers of recognized standing selected by it. If for any reason
the Administrative Agent shall have determined (which determination shall be
conclusive in the absence of manifest error) that it is unable to ascertain the
Federal Funds Effective Rate, for any reason, including the inability or failure
of the Administrative Agent to obtain sufficient quotations in accordance with
the terms thereof, the Alternate Base Rate shall be determined without regard to
clause (b) of the first sentence of this definition, as appropriate, until the
circumstances giving rise to such inability no longer exist. Any change in the
Alternate Base Rate due to a change in the Prime Rate or the Federal Funds
Effective Rate shall be effective on the opening of business on the date of such
change.
"Alternate Base Rate Loans" shall mean Loans that bear interest at an
interest rate based on the Alternate Base Rate.
"Applicable Percentage" shall mean, for any day, the rate per annum set
forth below opposite the applicable Level then in effect, it being understood
that the Applicable Percentage for (i) Revolving Loans and Term Loans which are
Alternate Base Rate Loans shall be the percentage set forth under the column
"Alternate Base Rate Margin for Revolving Loans and Term Loans", (ii) Revolving
Loans and Term Loans which are LIBOR Rate Loans shall be the percentage set
forth under the column "LIBOR Rate Margin for Revolving Loans, Term Loans and
Letter of Credit Fee", (iii) the Letter of Credit Fee shall be
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the percentage set forth under the column "LIBOR Rate Margin for Revolving
Loans, Term Loans and Letter of Credit Fee"; and (iv) the Commitment Fee shall
be the percentage set forth under the column "Commitment Fee":
LIBOR Rate
Alternate Margin for
Base Rate Revolving Loans,
Margin for Term Loans
Leverage Revolving Loans and Letter of Commitment
Level Ratio and Term Loans Credit Fees Fee
I > 4.00 to 1.0 0.50% 1.75% .375%
II < 4.00 to 1.0 but 0.25% 1.50% .375%
> 3.0 to 1.0
III < 3.50 to 1.0 but 0.125% 1.375% .375%
> 3.0 to 1.0
IV < 3.0 to 1.0 but 0% 1.25% .25%
> 2.50 to 1.0
V < 2.50 to 1.0 but 0% 1.125% .25%
> 2.00 to 1.0
VI < 2.00 to 1.0 but 0% 1.00% .25%
> 1.50 to 1.0
VII < 1.50 to 1.0 0% .875% .20%
The Applicable Percentage shall, in each case, be determined and adjusted
quarterly on the date five (5) Business Days after the date on which the
Administrative Agent has received from the Borrower the quarterly financial
information and certifications required to be delivered to the Administrative
Agent and the Lenders in accordance with the provisions of Sections 5.1(b) and
5.2(b) (each an "Interest Determination Date"). Such Applicable Percentage shall
be effective from such Interest Determination Date until the next such Interest
Determination Date. The initial Applicable Percentages shall be based on Level
III until the first Interest Determination Date occurring after March 31, 1999.
After the Closing Date, if the Borrower shall fail to provide the quarterly
financial information and certifications in accordance with the provisions of
Sections 5.1(b) and 5.2(b), the Applicable Percentage from such Interest
Determination Date shall, on the date five (5) Business Days after the date by
which the Borrower was so required to provide such financial information and
certifications to the Administrative Agent and the Lenders, be based on Level I
until such time as such information and certifications are provided, whereupon
the Level shall be determined by the then current Leverage Ratio.
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"Asset Disposition" shall mean the disposition of any or all of the
assets (including, without limitation, the Capital Stock of a Subsidiary or any
ownership interest in a joint venture) of the Borrower or any Subsidiary whether
by sale, lease, transfer or otherwise. The term "Asset Disposition" shall not
include (i) Specified Sales, (ii) the sale, lease or transfer of assets
permitted by Section 6.5(a)(iii) or (iv) hereof, or (iii) any Equity Issuance.
"Bankruptcy Code" shall mean the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, succeeded or replaced from time to
time.
"Borrower" shall have the meaning set forth in the first paragraph of
this Agreement.
"Borrowing Date" shall mean, in respect of any Loan, the date such Loan
is made.
"Business" shall have the meaning set forth in Section 3.10.
"Business Day" shall mean a day other than a Saturday, Sunday or other
day on which commercial banks in Charlotte, North Carolina or New York, New York
are authorized or required by law to close; provided, however, that when used in
connection with a rate determination, borrowing or payment in respect of a LIBOR
Rate Loan, the term "Business Day" shall also exclude any day on which banks in
London, England are not open for dealings in Dollar deposits in the London
interbank market.
"Capital Lease" shall mean any lease of property, real or personal, the
obligations with respect to which are required to be capitalized on a balance
sheet of the lessee in accordance with GAAP.
"Capital Lease Obligations" shall mean the capitalized lease obligations
relating to a Capital Lease determined in accordance with GAAP.
"Capital Stock" shall mean (i) in the case of a corporation, capital
stock, (ii) in the case of an association or business entity, any and all
shares, interests, participations, rights or other equivalents (however
designated) of capital stock, (iii) in the case of a partnership, partnership
interests (whether general or limited), (iv) in the case of a limited liability
company, membership interests and (v) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
"Cash Equivalents" shall mean (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition ("Government Obligations"), (ii)
U.S. dollar denominated (or foreign currency fully hedged) time deposits,
certificates of deposit, Eurodollar time deposits and Eurodollar certificates of
deposit of (y) any domestic commercial bank of recognized standing having
capital and surplus in excess of $250,000,000 or (z) any bank whose short-term
commercial paper rating from S&P is at least A-1 or the equivalent thereof or
from Xxxxx'x is at least P-1 or the equivalent
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thereof (any such bank being an "Approved Bank"), in each case with maturities
of not more than 364 days from the date of acquisition, (iii) commercial paper
and variable or fixed rate notes issued by any Approved Bank (or by the parent
company thereof) or any variable rate notes issued by, or guaranteed by any
domestic corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing within six
months of the date of acquisition, (iv) repurchase agreements with a bank or
trust company (including a Lender) or a recognized securities dealer having
capital and surplus in excess of $500,000,000 for direct obligations issued by
or fully guaranteed by the United States of America, (v) obligations of any
state of the United States or any political subdivision thereof for the payment
of the principal and redemption price of and interest on which there shall have
been irrevocably deposited Government Obligations maturing as to principal and
interest at times and in amounts sufficient to provide such payment, and (vi)
auction preferred stock rated in the highest short-term credit rating category
by S&P or Moody's.
"Closing Date" shall mean the date of this Agreement.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time.
"Collateral" shall mean a collective reference to the collateral which is
identified in, and at any time will be covered by, the Security Documents.
"Collateral Release Date" means the date upon which the Administrative
Agent, on behalf of the Required Lenders, releases its Liens granted pursuant to
the Security Agreement, which shall occur as soon as practicable after each of
the following shall have occurred: (i) written request by the Borrower made to
the Administrative Agent; (ii) receipt by the Borrower of (a) a senior debt
rating of at least "BB" from S&P or the equivalent from Moody's or (b) a rating
of at least "B+" on the Borrower's issued and outstanding Subordinated Debt from
S&P or the equivalent from Moody's; (iii) receipt by the Borrower of not less
than $80,000,000 in gross cash proceeds from the issuance of additional
Subordinated Debt or an Equity Issuance; (iv) the Borrower having a combination
of total Subordinated Debt outstanding plus proceeds received from any Equity
Issuances occurring after the Closing Date in an aggregate amount not less than
$200,000,000; (v) the Term Loans shall have been reduced by the amount of such
Subordinated Debt issuance or Equity Issuance referenced in subparagraph (iii)
above; and (vi) the Borrower shall be in compliance with each of the financial
covenants set forth in Section 5.9 and no other Default or Event of Default
shall have occurred and be continuing.
"Commitment" shall mean the Revolving Commitment, the LOC Commitment, the
Swingline Commitment and the Term Loan Commitment, individually or collectively,
as appropriate.
"Commitment Fee" shall have the meaning set forth in Section 2.5(a).
"Commitment Percentage" shall mean the Revolving Commitment Percentage,
the LOC Commitment Percentage and/or the Term Loan Commitment Percentage, as
appropriate.
"Commitment Period" shall mean the period from and including the Closing
Date to but not including the Revolving Commitment Termination Date.
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"Commitment Transfer Supplement" shall mean a Commitment Transfer
Supplement, substantially in the form of Schedule 9.6(c).
"Commonly Controlled Entity" shall mean an entity, whether or not
incorporated, which is under common control with the Borrower within the meaning
of Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"Consolidated Cash Taxes" means, for any period, the aggregate of all
income taxes of the Borrower and its Restricted Subsidiaries on a consolidated
basis for such period to the extent the same are paid in cash or become payable
during such period.
"Consolidated EBIT" means, for any period, the sum of (i) Consolidated
Net Income for such period, plus (ii) an amount which, in the determination of
Consolidated Net Income for such period, has been deducted for (A) Consolidated
Interest Expense, (B) total federal, state, local and foreign income taxes and
similar taxes on income, (C) Cost Savings Add-Backs resulting from the
acquisition of the Acquired Business, (D) other non-recurring, non-cash charges
and (E) other adjustments to Consolidated EBIT reasonably acceptable to the
Required Lenders, all as determined in accordance with GAAP.
"Consolidated EBITDA" means, for any period, the sum of (i) Consolidated
Net Income for such period, plus (ii) an amount which, in the determination of
Consolidated Net Income for such period, has been deducted for (A) Consolidated
Interest Expense, (B) total federal, state, local and foreign income taxes and
similar taxes on income, (C) depreciation, amortization expense and other
non-cash charges, (D) Cost Savings Add-Backs resulting from the acquisition of
the Acquired Business, (E) other non-recurring, non-cash charges and (F) other
adjustments to Consolidated EBITDA reasonably acceptable to the Required
Lenders.
"Consolidated Interest Expense" means, for any period, all interest
expense of the Borrower and its Restricted Subsidiaries including the interest
component under Capital Leases, as determined in accordance with GAAP. For
purposes hereof, Consolidated Interest Expense of the Borrower and its
Restricted Subsidiaries for the first three complete fiscal quarters to occur
after the Closing Date shall be determined by annualizing the components thereof
such that Consolidated Interest Expense for the first complete fiscal quarter to
occur after the Closing Date would be multiplied by four (4), the first two (2)
complete fiscal quarters would be multiplied by two (2) and the first three (3)
complete fiscal quarters would be multiplied by one and one-third (1 1/3).
"Consolidated Net Income" means, for any period, net income (excluding
extraordinary items) after taxes for such period of the Borrower and its
Restricted Subsidiaries on a consolidated basis, as determined in accordance
with GAAP.
"Contractual Obligation" shall mean, as to any Person, any provision of
any security issued by such Person or of any agreement, instrument or
undertaking to which such Person is a party or by which it or any of its
property is bound.
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"Cost Savings Add-Backs" shall mean (i) with respect to the four fiscal
quarters of the Borrower ending on or about December 31, 1998, $11,500,000, (ii)
with respect to the four fiscal quarters of the Borrower ending on or about
March 31, 1999, $11,500,000, (iii) with respect to the four fiscal quarters of
the Borrower ending on or about June 30, 1999, $8,625,000, (iv) with respect to
the four fiscal quarters of the Borrower ending on or about September 30, 1999,
$5,750,000 and (v) with respect to the four fiscal quarters of the Borrower
ending on or about December 31, 1999, $2,875,000.
"Credit Documents" shall mean this Agreement, each of the Notes, any
Joinder Agreement, the Letters of Credit, LOC Documents and the Security
Documents.
"Credit Party" shall mean any of the Borrower or the Guarantors.
"Credit Party Obligations" shall mean, without duplication, (i) all of
the obligations of the Credit Parties to the Lenders (including the Issuing
Lender) and the Administrative Agent, whenever arising, under this Agreement,
the Notes or any of the other Credit Documents (including, but not limited to,
any interest accruing after the occurrence of a filing of a petition of
bankruptcy under the Bankruptcy Code with respect to any Credit Party,
regardless of whether such interest is an allowed claim under the Bankruptcy
Code) and (ii) all liabilities and obligations, whenever arising, owing from the
Borrower or any of its Subsidiaries to any Lender, or any Affiliate of a Lender,
arising under any Hedging Agreement (or any Person that was a Lender or an
Affiliate of a Lender at the time of entering into any Hedging Agreement).
"Debt Issuance" shall mean the issuance of any Indebtedness for borrowed
money by the Borrower or any of its Subsidiaries (excluding, for purposes
hereof, Subordinated Debt, any Equity Issuance or any Indebtedness of the
Borrower and its Subsidiaries permitted to be incurred pursuant to Section 6.1
hereof).
"Default" shall mean any of the events specified in Section 7.1, whether
or not any requirement for the giving of notice or the lapse of time, or both,
or any other condition, has been satisfied.
"Defaulting Lender" shall mean, at any time, any Lender that, at such
time (a) has failed to make a Loan required pursuant to the term of this
Agreement, including the funding of a Participation Interest in accordance with
the terms hereof, (b) has failed to pay to the Administrative Agent or any
Lender an amount owed by such Lender pursuant to the terms of this Agreement, or
(c) has been deemed insolvent or has become subject to a bankruptcy or
insolvency proceeding or to a receiver, trustee or similar official.
"Dollars" and "$" shall mean dollars in lawful currency of the United
States of America.
"Domestic Lending Office" shall mean, initially, the office of each
Lender designated as such Lender's Domestic Lending Office shown on Schedule
9.2; and thereafter, such other office of such Lender as such Lender may from
time to time specify to the Administrative Agent and the Borrower as the office
of such Lender at which Alternate Base Rate Loans of such Lender are to be made.
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"Domestic Subsidiary" shall mean any Subsidiary that is organized and
existing under the laws of the United States or any state or commonwealth
thereof or under the laws of the District of Columbia.
"Environmental Laws" shall mean any and all applicable foreign, Federal,
state, local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decrees, requirements of any Governmental Authority or other
Requirement of Law (including common law) regulating, relating to or imposing
liability or standards of conduct concerning protection of human health or the
environment, as now or may at any time be in effect during the term of this
Agreement.
"Equity Issuance" shall mean any issuance by the Borrower or any
Subsidiary to any Person which is not a Credit Party of (a) shares of its
Capital Stock, (b) any shares of its Capital Stock pursuant to the exercise of
options or warrants or (c) any shares of its Capital Stock pursuant to the
conversion of any debt securities to equity. The term "Equity Issuance" shall
not include any Asset Disposition, any Debt Issuance or the issuance of common
stock of the Borrower's Subsidiaries to its officers, directors or employees in
connection with stock offering plans and other benefit plans of such
Subsidiaries.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended from time to time.
"Eurodollar Reserve Percentage" shall mean for any day, the percentage
(expressed as a decimal and rounded upwards, if necessary, to the next higher
1/100th of 1%) which is in effect for such day as prescribed by the Federal
Reserve Board (or any successor) for determining the maximum reserve requirement
(including without limitation any basic, supplemental or emergency reserves) in
respect of Eurocurrency liabilities, as defined in Regulation D of such Board as
in effect from time to time, or any similar category of liabilities for a member
bank of the Federal Reserve System in New York City.
"Event of Default" shall mean any of the events specified in Section 7.1;
provided, however, that any requirement for the giving of notice or the lapse of
time, or both, or any other condition, has been satisfied.
"Extension of Credit" shall mean, as to any Lender, the making of a Loan
by such Lender or the issuance of, or participation in, a Letter of Credit by
such Lender.
"Federal Funds Effective Rate" shall have the meaning set forth in the
definition of "Alternate Base Rate".
"Fee Letter" shall mean the letter agreement dated August 12, 1998
addressed to the Borrower from the Administrative Agent, as amended, modified or
otherwise supplemented.
"First Union" shall mean First Union National Bank, a national banking
association.
"Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.
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"Funded Debt" shall mean, with respect to any Person, without
duplication, (a) all Indebtedness of such Person other than Indebtedness of the
types referred to in clause (e), (g), (i) and (m) of the definition of
"Indebtedness" set forth in this Section 1.1, (b) all Funded Debt of others of
the type referred to in clause (a) above secured by (or for which the holder of
such Funded Debt has an existing right, contingent or otherwise, to be secured
by) any Lien on, or payable out of the proceeds of production from, property
owned or acquired by such Person, whether or not the obligations secured thereby
have been assumed, (c) all Guaranty Obligations of such Person with respect to
Funded Debt of the type referred to in clause (a) above of another Person and
(d) Funded Debt of the type referred to in clause (a) above of any partnership
or unincorporated joint venture in which such Person is legally obligated or has
a reasonable expectation of being liable with respect thereto.
"Funded Debt to Total Capitalization Ratio" means with respect to the
Borrower and its Restricted Subsidiaries on a consolidated basis as of any date
of calculation, the ratio of (a) Funded Debt of the Borrower and its Restricted
Subsidiaries on a consolidated basis on the last day of such period to (b) Total
Capitalization on the last day of such period.
"GAAP" shall mean generally accepted accounting principles in effect in
the United States of America applied on a consistent basis, subject, however, in
the case of determination of compliance with the financial covenants set out in
Section 5.9 to the provisions of Section 1.3.
"Government Acts" shall have the meaning set forth in Section 2.19.
"Governmental Authority" shall mean any nation or government, any state
or other political subdivision thereof and any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guaranty Obligations" means, with respect to any Person, without
duplication, any obligations of such Person (other than endorsements in the
ordinary course of business of negotiable instruments for deposit or collection)
guaranteeing or intended to guarantee any Indebtedness of any other Person in
any manner, whether direct or indirect, and including without limitation any
obligation, whether or not contingent, (i) to purchase any such Indebtedness or
any property constituting security therefor, (ii) to advance or provide funds or
other support for the payment or purchase of any such Indebtedness or to
maintain working capital, solvency or other balance sheet condition of such
other Person (including without limitation keep well agreements, maintenance
agreements, comfort letters or similar agreements or arrangements) for the
benefit of any holder of Indebtedness of such other Person, (iii) to lease or
purchase property, securities or services primarily for the purpose of assuring
the holder of such Indebtedness, or (iv) to otherwise assure or hold harmless
the holder of such Indebtedness against loss in respect thereof. The amount of
any Guaranty Obligation hereunder shall (subject to any limitations set forth
therein) be deemed to be an amount equal to the outstanding principal amount (or
maximum principal amount, if larger) of the Indebtedness in respect of which
such Guaranty Obligation is made.
"Guarantor" shall mean any of the Domestic Subsidiaries identified as a
"Guarantor" on the signature pages hereto and the Additional Credit Parties
15
which execute a Joinder Agreement, together with their successors and permitted
assigns.
"Guaranty" shall mean the guaranty of the Guarantors set forth in Article
X.
"Hedging Agreements" shall mean, with respect to any Person, any
agreement entered into to protect such Person against fluctuations in interest
rates, or currency or raw materials values, including, without limitation, any
interest rate swap, cap or collar agreement or similar arrangement between such
Person and one or more counterparties, any foreign currency exchange agreement,
currency protection agreements, commodity purchase or option agreements or other
interest or exchange rate or commodity price hedging agreements.
"Indebtedness" shall mean, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) all
obligations of such Person evidenced by bonds, debentures, notes or similar
instruments, or upon which interest payments are customarily made, (c) all
obligations of such Person under conditional sale or other title retention
agreements relating to property purchased by such Person (other than customary
reservations or retentions of title under agreements with suppliers entered into
in the ordinary course of business), (d) all obligations of such Person issued
or assumed as the deferred purchase price of property or services purchased by
such Person (other than trade debt incurred in the ordinary course of business
and due within six months of the incurrence thereof) which would appear as
liabilities on a balance sheet of such Person, (e) all obligations of such
Person under take-or-pay or similar arrangements or under commodities
agreements, (f) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on, or payable out of the proceeds of production from,
property owned or acquired by such Person, whether or not the obligations
secured thereby have been assumed, (g) all Guaranty Obligations of such Person
with respect to Indebtedness of another Person, (h) the principal portion of all
obligations of such Person under Capital Leases, (i) all obligations of such
Person under Hedging Agreements, (j) the maximum amount of all standby letters
of credit issued or bankers' acceptances facilities created for the account of
such Person and, without duplication, all drafts drawn thereunder (to the extent
unreimbursed), (k) all preferred Capital Stock issued by such Person and which
by the terms thereof could be (at the request of the holders thereof or
otherwise) subject to mandatory sinking fund payments, redemption or other
acceleration, (l) the principal balance outstanding under any synthetic lease,
tax retention operating lease, accounts receivable securitization program,
off-balance sheet loan or similar off-balance sheet financing product, and (m)
the Indebtedness of any partnership or unincorporated joint venture in which
such Person is a general partner or a joint venturer.
"Insolvency" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is insolvent within the meaning of such term as used in
Section 4245 of ERISA.
"Insolvent" shall mean being in a condition of Insolvency.
16
"Interest Coverage Ratio" means, with respect to the Borrower and its
Restricted Subsidiaries on a consolidated basis for the twelve month period
ending on the last day of any fiscal quarter of the Borrower and its Restricted
Subsidiaries, the ratio of (a) Consolidated EBIT for such period to (b)
Consolidated Interest Expense for such period.
"Interest Payment Date" shall mean (a) as to any Alternate Base Rate Loan
or Swingline Loan, the last day of each March, June, September and December and
on the applicable Maturity Date, (b) as to any LIBOR Rate Loan having an
Interest Period of three months or less, the last day of such Interest Period,
and (c) as to any LIBOR Rate Loan having an Interest Period longer than three
months, each day which is three months after the first day of such Interest
Period and the last day of such Interest Period.
"Interest Period" shall mean, with respect to any LIBOR Rate Loan,
(i) initially, the period commencing on the Borrowing Date or
conversion date, as the case may be, with respect to such LIBOR Rate Loan
and ending one, two, three or six months thereafter, as selected by the
Borrower in the notice of borrowing or notice of conversion given with
respect thereto; and
(ii) thereafter, each period commencing on the last day of the
immediately preceding Interest Period applicable to such LIBOR Rate Loan
and ending one, two, three or six months thereafter, as selected by the
Borrower by irrevocable notice to the Administrative Agent not less than
three Business Days prior to the last day of the then current Interest
Period with respect thereto;
provided that the foregoing provisions are subject to the
following:
(A) if any Interest Period pertaining to a LIBOR Rate Loan
would otherwise end on a day that is not a Business Day, such
Interest Period shall be extended to the next succeeding Business
Day unless the result of such extension would be to carry such
Interest Period into another calendar month in which event such
Interest Period shall end on the immediately preceding Business
Day;
(B) any Interest Period pertaining to a LIBOR Rate Loan that
begins on the last Business Day of a calendar month (or on a day
for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on
the last Business Day of the relevant calendar month;
(C) if the Borrower shall fail to give notice as provided
above, the Borrower shall be deemed to have selected an Alternate
Base Rate Loan to replace the affected LIBOR Rate Loan;
(D) any Interest Period in respect of any Loan that would
otherwise extend beyond the applicable Maturity Date and, further
with regard to the Term Loans, no Interest Period shall extend
beyond any principal amortization payment date unless the portion
of such Term Loan consisting of Alternate Base Rate Loans together
17
with the portion of such Term Loan consisting of LIBOR Rate Loans
with Interest Periods expiring prior to or concurrently with the
date such principal amortization payment date is due, is at least
equal to the amount of such principal amortization payment due on
such date; and
(E) no more than twelve (12) LIBOR Rate Loans may be in
effect at any time. For purposes hereof, LIBOR Rate Loans with
different Interest Periods shall be considered as separate LIBOR
Rate Loans, even if they shall begin on the same date and have the
same duration, although borrowings, extensions and conversions
may, in accordance with the provisions hereof, be combined at the
end of existing Interest Periods to constitute a new LIBOR Rate
Loan with a single Interest Period.
"Issuing Lender" shall mean First Union.
"Issuing Lender Fees" shall have the meaning set forth in Section 2.5(c).
"Joinder Agreement" shall mean a Joinder Agreement substantially in the
form of Schedule 5.10, executed and delivered by an Additional Credit Party in
accordance with the provisions of Section 5.10.
"Lender" shall have the meaning set forth in the first paragraph of this
Agreement.
"Letters of Credit" shall mean any letter of credit issued by the Issuing
Lender pursuant to the terms hereof, as such Letters of Credit may be amended,
modified, extended, renewed or replaced from time to time.
"Letter of Credit Fee" shall have the meaning set forth in Section
2.5(b).
"Leverage Ratio" means, with respect to the Borrower and its Restricted
Subsidiaries on a consolidated basis for the twelve month period ending on the
last day of any fiscal quarter, the ratio of (a) Funded Debt of the Borrower and
its Restricted Subsidiaries on a consolidated basis on the last day of such
period to (b) Consolidated EBITDA for such period.
"LIBOR" shall mean, for any LIBOR Rate 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 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 "LIBOR" shall mean, for any LIBOR Rate Loan 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 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, 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%). If, for any reason, neither of such rates is available,
then "LIBOR" shall mean the rate per annum at which, as determined by the
Administrative Agent, Dollars in an
18
amount comparable to the Loans then requested are being offered to leading banks
at approximately 11:00 A.M. London time, two (2) Business Days prior to the
commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period selected.
"LIBOR Lending Office" shall mean, initially, the office of each Lender
designated as such Lender's LIBOR Lending Office shown on Schedule 9.2; and
thereafter, such other office of such Lender as such Lender may from time to
time specify to the Administrative Agent and the Borrower as the office of such
Lender at which the LIBOR Rate Loans of such Lender are to be made.
"LIBOR Rate" shall mean a rate per annum (rounded upwards, if necessary,
to the next higher 1/100th of 1%) determined by the Administrative Agent
pursuant to the following formula:
LIBOR Rate = LIBOR
-----------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" shall mean Loans the rate of interest applicable to
which is based on the LIBOR Rate.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement or
preferential arrangement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement and any
Capital Lease having substantially the same economic effect as any of the
foregoing).
"Loan" shall mean a Revolving Loan, a Swingline Loan and/or the Term
Loans, as appropriate.
"LOC Commitment" shall mean the commitment of the Issuing Lender to issue
Letters of Credit and with respect to each Lender, the commitment of such Lender
to purchase participation interests in the Letters of Credit up to such Lender's
LOC Committed Amount as specified in Schedule 2.1(a), as such amount may be
reduced from time to time in accordance with the provisions hereof.
"LOC Commitment Percentage" shall mean, for each Lender, the percentage
identified as its LOC Commitment Percentage on Schedule 2.1(a), as such
percentage may be modified in connection with any assignment made in accordance
with the provisions of Section 9.6(c).
"LOC Committed Amount" shall mean, collectively, the aggregate amount of
all of the LOC Commitments of the Lenders to issue and participate in Letters of
Credit as referenced in Section 2.4 and, individually, the amount of each
Lender's LOC Commitment as specified in Schedule 2.1(a).
"LOC Documents" shall mean, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any documents delivered in connection
therewith, any application therefor, and any agreements, instruments, guarantees
or other documents (whether general in application or
19
applicable only to such Letter of Credit) governing or providing for (i) the
rights and obligations of the parties concerned or (ii) any collateral security
for such obligations.
"LOC Obligations" shall mean, at any time, the sum of (i) the maximum
amount which is, or at any time thereafter may become, available to be drawn
under Letters of Credit then outstanding, assuming compliance with all
requirements for drawings referred to in such Letters of Credit plus (ii) the
aggregate amount of all drawings under Letters of Credit honored by the Issuing
Lender but not theretofore reimbursed.
"Mandatory Borrowing" shall have the meaning set forth in Section
2.3(b)(ii) or Section 2.4(e), as the context may require.
"Material Adverse Effect" shall mean a material adverse effect on (a) the
business, operations, property or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole, (b) the ability of the Borrower
or any Guarantor to perform its obligations, when such obligations are required
to be performed, under this Agreement, any of the Notes or any other Credit
Document or (c) the validity or enforceability of this Agreement, any of the
Notes or any of the other Credit Documents or the rights or remedies of the
Administrative Agent or the Lenders hereunder or thereunder.
"Material Contract" shall mean any contract or other arrangement, whether
written or oral, to which the Borrower or any of its Subsidiaries is a party as
to which the breach, nonperformance, cancellation or failure to renew by any
party thereto could reasonably be expected to have a Material Adverse Effect.
"Materials of Environmental Concern" shall mean any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including, without limitation, asbestos,
polychlorinated biphenyls and urea-formaldehyde insulation.
"Maturity Date" shall mean (i) with respect to the Term Loan, the last
scheduled quarterly payment date for the Term Loan set forth in Section 2.2(b)
and (ii) with respect to the Revolving Loans or any Swingline Loan, the
Revolving Commitment Termination Date.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Multiemployer Plan" shall mean a Plan which is a multiemployer plan as
defined in Section 4001(a)(3) of ERISA.
"Net Cash Proceeds" shall mean the aggregate cash proceeds received by
the Borrower or any Subsidiary in respect of any Asset Disposition, Equity
Issuance or Debt Issuance, net of (a) direct costs (including, without
limitation, legal, accounting and investment banking fees, and sales
commissions) and (b) taxes paid or payable as a result thereof; it being
understood that "Net Cash Proceeds" shall include, without limitation, any cash
received upon the sale or other disposition of any non-cash consideration
received by the Borrower or any Subsidiary in any Asset Disposition, Equity
Issuance or Debt Issuance.
20
"Note" or "Notes" shall mean the Revolving Notes, the Swingline Note
and/or the Term Notes, collectively, separately or individually, as appropriate.
"Notice of Borrowing" shall mean the written notice of borrowing as
referenced and defined in Section 2.1(b)(i) or 2.3(b)(i), as appropriate.
"Notice of Conversion" shall mean the written notice of extension or
conversion as referenced and defined in Section 2.10.
"Obligations" shall mean, collectively, Loans and LOC Obligations.
"Participant" shall have the meaning set forth in Section 9.6(b).
"Participation Interest" shall mean the purchase by a Lender of a
participation interest in Swingline Loans as provided in Section 2.3(b)(ii) or
in Letters of Credit as provided in Section 2.4.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA.
"Permitted Investments" shall mean:
(i) cash and Cash Equivalents;
(ii) receivables owing to the Borrower or any of its Subsidiaries
or any receivables and advances to suppliers, in each case if created,
acquired or made in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;
(iii) investments in and loans to any Credit Parties;
(iv) loans and advances to officers, directors, employees and
Affiliates in an aggregate amount not to exceed $500,000 at any time
outstanding;
(v) investments (including debt obligations) received in
connection with the bankruptcy or reorganization of suppliers and
customers and in settlement of delinquent obligations of, and other
disputes with, customers and suppliers arising in the ordinary course of
business;
(vi) investments, acquisitions or transactions permitted under
Section 6.5(b);
(vii) investments in Unrestricted Subsidiaries in an aggregate
amount not to exceed $25,000,000; provided, however that investments in
Unrestricted Subsidiaries may be increased to an aggregate amount not to
exceed $50,000,000 in the aggregate on a dollar for dollar basis with the
issuance of additional Subordinated Debt or an Equity Issuance after the
Closing Date in excess of $80,000,000 in gross cash proceeds; and
(viii) additional loan advances and/or investments of a nature not
contemplated by the foregoing clauses hereof, provided that such loans,
advances and/or investments made pursuant to this clause (vii) shall not
exceed an aggregate amount of $1,000,000.
21
As used herein, "investment" means all investments, in cash or by
delivery of property made, directly or indirectly in, to or from any Person,
whether by acquisition of shares of Capital Stock, property, assets,
indebtedness or other obligations or securities or by loan advance, capital
contribution or otherwise.
"Permitted Liens" shall mean:
(i) Liens created by or otherwise existing, under or in connection
with this Agreement or the other Credit Documents in favor of the
Lenders;
(ii) Liens in favor of a Lender or an Affiliate of a Lender (or a
Person that was a Lender or Affiliate of a Lender at the time of entry
into any Hedging Agreement) in connection with Hedging Agreements, but
only (A) to the extent such Liens secure obligations under Hedging
Agreements with any Lender, or any Affiliate of a Lender, (B) to the
extent such Liens are on the same collateral as to which the
Administrative Agent on behalf of the Lenders also has a Lien and (C) if
such provider and the Lenders shall share pari passu in the collateral
subject to such Liens;
(iii) purchase money Liens securing purchase money indebtedness
(and refinancings thereof) to the extent permitted under Section 6.1(c);
(iv) Liens for taxes, assessments, charges or other governmental
levies not yet due or as to which the period of grace (not to exceed 60
days), if any, related thereto has not expired or which are being
contested in good faith by appropriate proceedings, provided that
adequate reserves with respect thereto are maintained on the books of the
Borrower or its Subsidiaries, as the case may be, in conformity with GAAP
(or, in the case of Subsidiaries with significant operations outside of
the United States of America, generally accepted accounting principles in
effect from time to time in their respective jurisdictions of
incorporation);
(v) carriers', warehousemen's, mechanics', materialmen's,
repairmen's or other like Liens arising in the ordinary course of
business for charges which are not overdue for a period of more than 60
days or which are being contested in good faith by appropriate
proceedings;
(vi) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation and deposits
securing liability to insurance carriers under insurance or
self-insurance arrangements;
(vii) deposits to secure the performance of bids, trade contracts,
(other than for borrowed money), leases, statutory obligations, surety
and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;
(viii) any extension, renewal or replacement (or successive
extensions, renewals or replacements) , in whole or in part, of any Lien
referred to in the foregoing clauses; provided that such extension,
renewal or replacement Lien shall be limited to all or a part of the
22
property which secured the Lien so extended, renewed or replaced (plus
improvements on such property);
(ix) Liens on accounts owing by foreign debtors securing
Indebtedness and obligations owing under factoring arrangements to the
extent permitted under Section 6.1(i); and
(x) existing Liens set forth on Schedule 6.2 and other Liens on
assets of the Borrower and its Subsidiaries securing Indebtedness
permitted pursuant to Section 6.1(j); provided that the Liens incurred in
connection with the Existing Letters of Credit set forth in Schedule
6.1(b) shall only be permitted hereunder for a period 30 days following
the Closing Date.
"Person" shall mean an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust, unincorporated
association, joint venture, Governmental Authority or other entity of whatever
nature.
"Plan" shall mean, at any particular time, any employee benefit plan
which is covered by Title IV of ERISA and in respect of which the Borrower or a
Commonly Controlled Entity is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"Prime Rate" shall have the meaning set forth in the definition of
Alternate Base Rate.
"Properties" shall have the meaning set forth in Section 3.10(a).
"Purchasing Lenders" shall have the meaning set forth in Section 9.6(c).
"Recourse Debt" means any Indebtedness of the Borrower or any Subsidiary
of the Borrower with respect to which (i) the Borrower or any Restricted
Subsidiary guarantees such Indebtedness, provides any credit support or
collateral security with regard to such Indebtedness or is directly or
indirectly liable in any way for such Indebtedness and (ii) any default or event
of default under such Indebtedness would permit under any circumstance any
holder (other than the Administrative Agent and the Lenders) of any Indebtedness
of the Borrower or any Restricted Subsidiary to declare a default of such
Indebtedness of the Borrower or any Restricted Subsidiary or cause the payment
thereof to be accelerated or payable prior to its stated maturity.
"Recovery Event" shall mean the receipt by the Borrower or any of its
Subsidiaries of any cash insurance proceeds or condemnation award payable by
reason of theft, loss, physical destruction or damage, taking or similar event
with respect to any of their respective property or assets.
"Register" shall have the meaning set forth in Section 9.6(d).
"Reorganization" shall mean, with respect to any Multiemployer Plan, the
condition that such Plan is in reorganization within the meaning of such term as
used in Section 4241 of ERISA.
23
"Reportable Event" shall mean any of the events set forth in Section
4043(c) of ERISA, other than those events as to which the thirty-day notice
period is waived under PBGC Reg. Section 4043.
"Required Lenders" shall mean (i) Lenders holding in the aggregate not
less than 51% of all Revolving Loans and LOC Obligations then outstanding at
such time plus the aggregate unused Revolving Commitments at such time (treating
for purposes hereof in the case of Swingline Loans and LOC Obligations, in the
case of the Swingline Lender and the Issuing Lender, only the portion of the
Swingline Loans and the LOC Obligations of the Swingline Lender and the Issuing
Lender, respectively, which is not subject to the Participation Interests of the
other Lenders and, in the case of the Lenders other than the Swingline Lender
and the Issuing Lender, the Participation Interests of such Lenders in Swingline
Loans and LOC Obligations hereunder as direct Obligations) and (ii) Lenders
holding in the aggregate not less than 51% of all Term Loans then outstanding at
such time; provided, however, that if any Lender shall be a Defaulting Lender at
such time, then there shall be excluded from the determination of Required
Lenders, Obligations (including Participation Interests) owing to such
Defaulting Lender and such Defaulting Lender's Commitments, or after termination
of the Commitments, the principal balance of the Obligations owing to such
Defaulting Lender.
"Requirement of Law" shall mean, as to any Person, the Certificate of
Incorporation and By-laws or other organizational or governing documents of such
Person, and each law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Responsible Officer" shall mean, as to (a) the Borrower, the President,
the Chief Executive Officer, the Chief Financial Officer and the Vice President,
Finance or (b) any other Credit Party, any duly authorized officer thereof.
"Restricted Payment" shall mean (a) any dividend or other distribution,
direct or indirect, on account of any shares of any class of Capital Stock of
the Borrower or any of its Subsidiaries, now or hereafter outstanding, (b) any
redemption, retirement, sinking fund or similar payment, purchase or other
acquisition for value, direct or indirect, of any shares of any class of Capital
Stock of the Borrower or any of its Subsidiaries, now or hereafter outstanding,
(c) any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of Capital
Stock of the Borrower or any of its Subsidiaries, now or hereafter outstanding,
or (d) any payment or prepayment of principal of, premium, if any, or interest
on, redemption, purchase, retirement, defeasance, sinking fund or similar
payment with respect to, any Subordinated Debt.
"Restricted Subsidiary" means all existing subsidiaries of the Borrower
and any other subsidiary of the Borrower which has Recourse Debt. Each
Restricted Subsidiary shall become a Guarantor hereunder.
"Revolving Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make Revolving Loans in an aggregate principal
amount at any time outstanding up to such Lender's Revolving Committed Amount as
specified in Schedule 2.1(a), as such amount may be reduced from time to time in
accordance with the provisions hereof.
24
"Revolving Commitment Percentage" shall mean, for each Lender, the
percentage identified as its Revolving Commitment Percentage on Schedule 2.1(a),
as such percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 9.6(c).
"Revolving Commitment Termination Date" shall mean September 30, 2003.
"Revolving Committed Amount" shall mean, collectively, the aggregate
amount of all Revolving Commitments as referenced in Section 2.1(a), as such
amount may be reduced from time to time in accordance with the provisions
hereof, and, individually, the amount of each Lender's Revolving Commitment as
specified on Schedule 2.1(a).
"Revolving Loans" shall have the meaning set forth in Section 2.1.
"Revolving Note" or "Revolving Notes" shall mean the promissory notes of
the Borrower in favor of each of the Lenders evidencing the Revolving Loans
provided pursuant to Section 2.1(e), individually or collectively, as
appropriate, as such promissory notes may be amended, modified, supplemented,
extended, renewed or replaced from time to time.
"S&P" shall mean Standard & Poor's Ratings Group, a division of McGraw
Hill, Inc.
"Security Agreement" shall mean the Security Agreement dated as of the
Closing Date given by the Borrower and the other Credit Parties to the
Administrative Agent, as amended, modified or supplemented from time to time in
accordance with its terms.
"Security Documents" shall mean the Security Agreement and such other
documents executed and delivered in connection with the attachment and
perfection of the Administrative Agent's security interests and liens arising
thereunder, including, without limitation, UCC financing statements.
"Senior Funded Debt" means, the Credit Party Obligations and all other
Funded Debt which is not contractually subordinated or junior in right of
payment to the Credit Party Obligations.
"Senior Leverage Ratio" means with respect to the Borrower and its
Restricted Subsidiaries on a consolidated basis for the twelve month period
ending on the last day of any fiscal quarter of the Borrower and its Restricted
Subsidiaries, the ratio of (a) Senior Funded Debt at such time to (b)
Consolidated EBITDA for such period.
"Single Employer Plan" shall mean any Plan which is not a Multiemployer
Plan.
"Specified Sales" shall mean (a) the sale, transfer, lease or other
disposition of inventory and materials in the ordinary course of business and
(b) the sale, transfer or other disposition of Permitted Investments described
in clause (i) of the definition thereof.
"Subordinated Debt" means (i) those 10L% Senior Subordinated Notes
of the Borrower due December 15, 2003 in an aggregate amount of up to
$120,000,000 and (ii) any other Indebtedness incurred by the Borrower which
25
by its terms is specifically subordinated in right of payment to the prior
payment of the Credit Party Obligations and which complies with the terms of
Section 6.1(h) hereof.
"Subordinated Note Indenture" means that certain indenture dated as of
December 15, 1993 related to those 10L% Senior Subordinated Notes of the
Borrower due December 15, 2003.
"Subsidiary" shall mean, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of the happening of a
contingency) to elect a majority of the board of directors or other managers of
such corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a "Subsidiary" or to "Subsidiaries" in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.
"Swingline Commitment" shall mean the commitment of the Swingline Lender
to make Swingline Loans in an aggregate principal amount at any time outstanding
up to the Swingline Committed Amount, and the commitment of the Lenders to
purchase participation interests in the Swingline Loans as provided in Section
2.3(b)(ii), as such amounts may be reduced from time to time in accordance with
the provisions hereof.
"Swingline Committed Amount" shall mean the amount of the Swingline
Lender's Swingline Commitment as specified in Section 2.3(a).
"Swingline Lender" shall mean First Union, in its capacity as such.
"Swingline Loan" or "Swingline Loans" shall have the meaning set forth in
Section 2.3(a).
"Swingline Note" shall mean the promissory note of the Borrower in favor
of the Swingline Lender evidencing the Swingline Loans provided pursuant to
Section 2.3(d), as such promissory note may be amended, modified, supplemented,
extended, renewed or replaced from time to time.
"Taxes" shall have the meaning set forth in Section 2.18.
"Term Loan" shall have the meaning set forth in Section 2.2(a).
"Term Loan Commitment" shall mean, with respect to each Lender, the
commitment of such Lender to make its portion of the Term Loan in a principal
amount equal to such Lender's Term Loan Commitment Percentage of the Term Loan
Committed Amount (and for purposes of making determinations of Required Lenders
hereunder after the Closing Date, the principal amount outstanding on the Term
Loan).
"Term Loan Commitment Percentage" shall mean, for any Lender, the
percentage identified as its Term Loan Commitment Percentage on Schedule 2.1(a),
as such percentage may be modified in connection with any assignment made in
accordance with the provisions of Section 9.6.
26
"Term Loan Committed Amount" shall have the meaning set forth in Section
2.2(a).
"Term Note" or "Term Notes" shall mean the promissory notes of the
Borrower in favor of each of the Lenders evidencing the portion of the Term Loan
provided pursuant to Section 2.2(d), individually or collectively, as
appropriate, as such promissory notes may be amended, modified, restated,
supplemented, extended, renewed or replaced from time to time.
"Total Capitalization" means, at any time, the sum of (a) Funded Debt of
the Borrower and its Restricted Subsidiaries on a consolidated basis plus (b)
total shareholders' equity of the Borrower and its Restricted Subsidiaries on a
consolidated basis, as determined in accordance with GAAP.
"Tranche" shall mean the collective reference to LIBOR Rate Loans whose
Interest Periods begin and end on the same day. A Tranche may sometimes be
referred to as a "LIBOR Tranche".
"Transfer Effective Date" shall have the meaning set forth in each
Commitment Transfer Supplement.
"2.18 Certificate" shall have the meaning set forth in Section 2.18.
"Type" shall mean, as to any Loan, its nature as an Alternate Base Rate
Loan, LIBOR Rate Loan or Swingline Loan, as the case may be.
"Unrestricted Subsidiary" means any direct or indirect Subsidiary of the
Borrower that is not a Restricted Subsidiary; provided that upon any
Unrestricted Subsidiaries' incurrence of any Indebtedness which may be deemed
Recourse Debt, such Unrestricted Subsidiary shall become a Restricted Subsidiary
and shall execute a Joinder Agreement as set forth in Section 5.10, and be
subject to all obligations applicable thereto hereunder.
"Voting Stock" means, with respect to any Person, Capital Stock issued by
such Person the holders of which are ordinarily, in the absence of
contingencies, entitled to vote for the election of directors (or persons
performing similar functions) of such Person, even though the right so to vote
has been suspended by the happening of such a contingency.
"Year 2000 Compliant" shall have the meaning set forth in Section 3.24.
Section 1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this
Agreement shall have the defined meanings when used in the Notes or other
Credit Documents or any certificate or other document made or delivered
pursuant hereto.
(b) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement
as a whole and not to any particular provision of this Agreement, and
Section, subsection, Schedule and Exhibit references are to this
Agreement unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
27
Section 1.3 Accounting Terms.
Unless otherwise specified herein, all accounting terms used herein shall
be interpreted, all accounting determinations hereunder shall be made, and all
financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP applied on a basis consistent with the most recent audited
consolidated financial statements of the Borrower delivered to the Lenders;
provided that, if the Borrower notifies the Administrative Agent that it wishes
to amend any covenant in Section 5.9 to eliminate the effect of any change in
GAAP on the operation of such covenant (or if the Administrative Agent notifies
the Borrower that the Required Lenders wish to amend Section 5.9 for such
purpose), then the Borrower's compliance with such covenant shall be determined
on the basis of GAAP in effect immediately before the relevant change in GAAP
became effective, until either such notice is withdrawn or such covenant is
amended in a manner satisfactory to the Borrower and the Required Lenders.
The Borrower shall deliver to the Administrative Agent and each Lender at
the same time as the delivery of any annual or quarterly financial statements
given in accordance with the provisions of Section 5.1, (i) a description in
reasonable detail of any material change in the application of accounting
principles employed in the preparation of such financial statements from those
applied in the most recently preceding quarterly or annual financial statements
as to which no objection shall have been made in accordance with the provisions
above and (ii) a reasonable estimate of the effect on the financial statements
on account of such changes in application.
ARTICLE II
THE LOANS; AMOUNT AND TERMS
Section 2.1 Revolving Loans.
(a) Revolving Commitment. During the Commitment Period, subject to
the terms and conditions hereof, each Lender severally agrees to make
revolving credit loans ("Revolving Loans") to the Borrower from time to
time for the purposes hereinafter set forth; provided, however, that (i)
with regard to each Lender individually, the sum of such Lender's share
of outstanding Revolving Loans plus such Lender's Revolving Commitment
Percentage of Swingline Loans plus such Lender's LOC Commitment
Percentage of LOC Obligations shall not exceed such Lender's Revolving
Commitment Percentage of the aggregate Revolving Committed Amount, and
(ii) with regard to the Lenders collectively, the sum of the aggregate
amount of outstanding Revolving Loans plus Swingline Loans plus LOC
Obligations shall not exceed the Revolving Committed Amount. For purposes
hereof, the aggregate amount available hereunder shall be ONE HUNDRED
FIFTY MILLION DOLLARS ($150,000,000) (as such aggregate maximum amount
may be reduced from time to time as provided in Section 2.6, the
"Revolving Committed Amount"). Revolving Loans may consist of Alternate
Base Rate Loans or LIBOR Rate Loans, or a combination thereof, as the
Borrower may request, and may be repaid and reborrowed in accordance with
the provisions hereof. LIBOR Rate Loans shall be made by each Lender at
its LIBOR Lending Office and Alternate Base Rate Loans at its Domestic
Lending Office.
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(b) Revolving Loan Borrowings.
(i) Notice of Borrowing. The Borrower shall request a
Revolving Loan borrowing by written notice (or
telephone notice promptly confirmed in writing which
confirmation may be by fax) to the Administrative Agent
not later than 11:00 A.M. (Charlotte, North Carolina
time) on the Business Day prior to the date of
requested borrowing in the case of Alternate Base Rate
Loans, and on the third Business Day prior to the date
of the requested borrowing in the case of LIBOR Rate
Loans. Each such request for borrowing shall be
irrevocable and shall specify (A) that a Revolving Loan
is requested, (B) the date of the requested borrowing
(which shall be a Business Day), (C) the aggregate
principal amount to be borrowed, (D) whether the
borrowing shall be comprised of Alternate Base Rate
Loans, LIBOR Rate Loans or a combination thereof, and
if LIBOR Rate Loans are requested, the Interest
Period(s) therefor. A form of Notice of Borrowing (a
"Notice of Borrowing") is attached as Schedule
2.1(b)(i). If the Borrower shall fail to specify in any
such Notice of Borrowing (I) an applicable Interest
Period in the case of a LIBOR Rate Loan, then such
notice shall be deemed to be a request for an Interest
Period of one month, or (II) the type of Revolving Loan
requested, then such notice shall be deemed to be a
request for an Alternate Base Rate Loan hereunder. The
Administrative Agent shall give notice to each Lender
promptly upon receipt of each Notice of Borrowing, the
contents thereof and each such Lender's share thereof.
All Revolving Loans made on the Closing Date shall bear
interest at the Alternate Base Rate until three (3)
Business Days after the Closing Date.
(ii) Minimum Amounts. Each Revolving Loan borrowing shall be
in a minimum aggregate amount of $3,000,000 and
integral multiples of $1,000,000 in excess thereof (or
the remaining amount of the Revolving Committed Amount,
if less).
(iii) Advances. Each Lender will make its Revolving
Commitment Percentage of each Revolving Loan borrowing
available to the Administrative Agent for the account
of the Borrower at the office of the Administrative
Agent specified in Schedule 9.2, or at such other
office as the Administrative Agent may designate in
writing, by 1:00 P.M. (Charlotte, North Carolina time)
on the date specified in the applicable Notice of
Borrowing in Dollars and in funds immediately available
to the Administrative Agent. Such borrowing will then
be made available to the Borrower by the Administrative
Agent by crediting the account of the Borrower on the
books of such office with the aggregate of the amounts
made available to the Administrative Agent by the
Lenders and in like funds as received by the
Administrative Agent.
29
(c) Repayment. The principal amount of all Revolving Loans shall
be due and payable in full on the Revolving Commitment
Termination Date.
(d) Interest. Subject to the provisions of Section 2.9, Revolving
Loans shall bear interest as follows:
(i) Alternate Base Rate Loans. During such periods as
Revolving Loans shall be comprised of Alternate Base
Rate Loans, each such Alternate Base Rate Loan shall
bear interest at a per annum rate equal to the sum of
the Alternate Base Rate plus the Applicable Percentage;
and
(ii) LIBOR Rate Loans. During such periods as Revolving
Loans shall be comprised of LIBOR Rate Loans, each such
LIBOR Rate Loan shall bear interest at a per annum rate
equal to the sum of the LIBOR Rate plus the Applicable
Percentage.
Interest on Revolving Loans shall be payable in arrears on each
Interest Payment Date.
(e) Revolving Notes. Each Lender's Revolving Commitment Percentage
of the Revolving Loans shall be evidenced by a duly executed promissory
note of the Borrower to such Lender in substantially the form of Schedule
2.1(e).
Section 2.2 Term Loan.
(a) Term Loan. Subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, each
Lender severally agrees to make available to the Borrower on the Closing
Date such Lender's Term Loan Commitment Percentage of a term loan in
Dollars (the "Term Loan") in the aggregate principal amount of ONE
HUNDRED TWENTY-FIVE MILLION DOLLARS ($125,000,000) (the "Term Loan
Committed Amount") for the purposes hereinafter set forth. The Term Loan
may consist of Alternate Base Rate Loans or LIBOR Rate Loans, or a
combination thereof, as the Borrower may request; provided that the Term
Loans made on the Closing Date shall bear interest at the Alternate Base
Rate until three (3) Business Days after the Closing Date. The Borrower
shall request the initial Term Loan borrowing by written notice (or
telephone notice promptly confirmed in writing which confirmation may be
by fax) to the Administrative Agent not later than 11:00 A.M. (Charlotte,
North Carolina time) on the Business Day prior to the date of requested
borrowing. Amounts repaid on the Term Loan may not be reborrowed. LIBOR
Rate Loans shall be made by each Lender at its LIBOR Lending Office and
Alternate Base Rate Loans at its Domestic Lending Office.
(b) Repayment of Term Loan. The principal amount of the Term Loan
shall be repaid in fifteen (15) consecutive fiscal quarterly installments
as follows, unless accelerated sooner pursuant to Section 7.2:
30
Principal Term Loan Principal
Amortization Amortization
Payment Dates Payment
March 31, 2000 $5,000,000
June 30, 2000 $5,000,000
September 29, 2000 $5,000,000
December 29, 2000 $5,000,000
March 30, 2001 $6,500,000
June 29, 2001 $6,500,000
September 28, 2001 $10,000,000
December 31, 2001 $10,000,000
March 29, 2002 $10,000,000
June 28, 2002 $10,000,000
September 30, 2002 $10,000,000
December 31, 2002 $10,000,000
March 31, 2003 $10,000,000
June 30, 2003 $10,000,000
September 30, 2003 $12,000,000
(c) Interest on the Term Loan. Subject to the provisions of
Section 2.9, the Term Loan shall bear interest as follows:
(i) Alternate Base Rate Loans. During such periods as the
Term Loan shall be comprised of Alternate Base Rate Loans, each
such Alternate Base Rate Loan shall bear interest at a per annum
rate equal to the sum of the Alternate Base Rate plus the
Applicable Percentage; and
(ii) LIBOR Rate Loans. During such periods as the Term Loan
shall be comprised of LIBOR Rate Loans, each such LIBOR Rate Loan
shall bear interest at a per annum rate equal to the sum of the
LIBOR Rate plus the Applicable Percentage.
Interest on the Term Loan shall be payable in arrears on
each Interest Payment Date.
(d) Term Notes. Each Lender's Term Loan Commitment Percentage of
the Term Loan outstanding as of the Closing Date shall be evidenced by a
duly executed promissory note of the Borrower to such Lender in
substantially the form of Schedule 2.2(d).
Section 2.3 Swingline Loan Subfacility.
(a) Swingline Commitment. During the Commitment Period, subject to
the terms and conditions hereof, the Swingline Lender, in its individual
capacity, agrees to make certain revolving credit loans to
31
the Borrower (each a "Swingline Loan" and, collectively, the "Swingline
Loans") for the purposes hereinafter set forth; provided, however, (i)
the aggregate amount of Swingline Loans outstanding at any time shall not
exceed FIFTEEN MILLION DOLLARS ($15,000,000) (the "Swingline Committed
Amount"), and (ii) the sum of the aggregate amount of outstanding
Revolving Loans plus Swingline Loans plus LOC Obligations shall not
exceed the Revolving Committed Amount. Swingline Loans hereunder may be
repaid and reborrowed in accordance with the provisions hereof.
(b) Swingline Loan Borrowings.
(i) Notice of Borrowing and Disbursement. The Swingline Lender
will make Swingline Loans available to the Borrower on any
Business Day upon request made by the Borrower not later than
12:00 Noon (Charlotte, North Carolina time) on such Business Day.
A notice of request for Swingline Loan borrowing shall be made in
the form of Schedule 2.1(b)(i) with appropriate modifications.
Swingline Loan borrowings hereunder shall be made in minimum
amounts of $100,000 and in integral amounts of $100,000 in excess
thereof.
(ii) Repayment of Swingline Loans. The principal amount of
each Swingline Loan shall be due and payable on the Revolving
Commitment Termination Date. The Swingline Lender may, at any
time, in its sole discretion, by written notice to the Borrower
and the Administrative Agent, demand repayment of its Swingline
Loans by way of a Revolving Loan borrowing, in which case the
Borrower shall be deemed to have requested a Revolving Loan
borrowing comprised entirely of Alternate Base Rate Loans in the
amount of such Swingline Loans; provided, however, that, in the
following circumstances, any such demand shall also be deemed to
have been given one Business Day prior to each of (i) the
Revolving Commitment Termination Date, (ii) the occurrence of any
Event of Default described in Section 7.1(e), (iii) upon
acceleration of the Credit Party Obligations hereunder, whether on
account of an Event of Default described in Section 7.1(e) or any
other Event of Default, and (iv) the exercise of remedies in
accordance with the provisions of Section 7.2 hereof (each such
Revolving Loan borrowing made on account of any such deemed
request therefor as provided herein being hereinafter referred to
as a "Mandatory Borrowing"). Each Lender hereby irrevocably agrees
to make such Revolving Loans promptly upon any such request or
deemed request on account of each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and
on the same such date notwithstanding (I) the amount of Mandatory
Borrowing may not comply with the minimum amount for borrowings of
Revolving Loans otherwise required hereunder, (II) whether any
conditions specified in Section 4.2 are then satisfied, (III)
whether a Default or an Event of Default then exists, (IV) failure
of any such request or deemed request for Revolving Loans to be
made by the time otherwise required in Section 2.1(b)(i), (V) the
date of such Mandatory
32
Borrowing, or (VI) any reduction in the Revolving Committed Amount
or termination of the Revolving Commitments immediately prior to
such Mandatory Borrowing or contemporaneously therewith. In the
event that any Mandatory Borrowing cannot for any reason be made
on the date otherwise required above (including, without
limitation, as a result of the commencement of a proceeding under
the Bankruptcy Code with respect to the Borrower), then each
Lender hereby agrees that it shall forthwith purchase (as of the
date the Mandatory Borrowing would otherwise have occurred, but
adjusted for any payments received from the Borrower on or after
such date and prior to such purchase) from the Swingline Lender
such participations in the outstanding Swingline Loans as shall be
necessary to cause each such Lender to share in such Swingline
Loans ratably based upon its respective Revolving Commitment
Percentage (determined before giving effect to any termination of
the Commitments pursuant to Section 7.2), provided that (A) all
interest payable on the Swingline Loans shall be for the account
of the Swingline Lender until the date as of which the respective
participation is purchased, and (B) at the time any purchase of
participations pursuant to this sentence is actually made, the
purchasing Lender shall be required to pay to the Swingline Lender
interest on the principal amount of such participation purchased
for each day from and including the day upon which the Mandatory
Borrowing would otherwise have occurred to but excluding the date
of payment for such participation, at the rate equal to, if paid
within two (2) Business Days of the date of the Mandatory
Borrowing, the Federal Funds Effective Rate, and thereafter at a
rate equal to the Alternate Base Rate.
(c) Interest on Swingline Loans. Subject to the provisions of
Section 2.9, Swingline Loans shall bear interest at a per annum rate
equal to the Alternate Base Rate plus the Applicable Percentage for
Revolving Loans that are Alternate Base Rate Loans. Interest on Swingline
Loans shall be payable in arrears on each Interest Payment Date.
(d) Swingline Note. The Swingline Loans shall be evidenced by a
duly executed promissory note of the Borrower to the Swingline Lender in
the original amount of the Swingline Committed Amount and substantially
in the form of Schedule 2.3(d).
Section 2.4 Letter of Credit Subfacility.
(a) Issuance. Subject to the terms and conditions hereof and of
the LOC Documents, if any, and any other terms and conditions which the
Issuing Lender may reasonably require, during the Commitment Period the
Issuing Lender shall issue, and the Lenders shall participate in, Letters
of Credit for the account of the Borrower from time to time upon request
in a form acceptable to the Issuing Lender; provided, however, that (i)
the aggregate amount of LOC Obligations shall not at any time exceed TEN
MILLION DOLLARS ($10,000,000) (the "LOC Committed Amount"), (ii) the sum
of the aggregate amount of Revolving Loans plus Swingline
33
Loans plus LOC Obligations shall not at any time exceed the Revolving
Committed Amount, (iii) all Letters of Credit shall be denominated in
U.S. Dollars and (iv) Letters of Credit shall be issued for the purpose
of supporting tax-advantaged variable rate demand note financing and for
other lawful corporate purposes and may be issued as standby letters of
credit, including in connection with workers' compensation and other
insurance programs, and trade letters of credit. Except as otherwise
expressly agreed upon by all the Lenders, no Letter of Credit shall have
an original expiry date more than twelve (12) months from the date of
issuance; provided, however, so long as no Default or Event of Default
has occurred and is continuing and subject to the other terms and
conditions to the issuance of Letters of Credit hereunder, the expiry
dates of Letters of Credit may be extended annually or periodically from
time to time on the request of the Borrower or by operation of the terms
of the applicable Letter of Credit to a date not more than twelve (12)
months from the date of extension; provided, further, that no Letter of
Credit, as originally issued or as extended, shall have an expiry date
extending beyond the Revolving Commitment Termination Date. Each Letter
of Credit shall comply with the related LOC Documents. The issuance and
expiry date of each Letter of Credit shall be a Business Day. Any Letters
of Credit issued hereunder shall be in a minimum original face amount of
$150,000. There will be no more than 15 Letters of Credit outstanding at
any time. First Union shall be the Issuing Lender on all Letters of
Credit issued after the Closing Date.
(b) Notice and Reports. The request for the issuance of a Letter
of Credit shall be submitted to the Issuing Lender at least five (5)
Business Days prior to the requested date of issuance. The Issuing Lender
will promptly upon request provide to the Administrative Agent for
dissemination to the Lenders a detailed report specifying the Letters of
Credit which are then issued and outstanding and any activity with
respect thereto which may have occurred since the date of any prior
report, and including therein, among other things, the account party, the
beneficiary, the face amount, expiry date as well as any payments or
expirations which may have occurred. The Issuing Lender will further
provide to the Administrative Agent promptly upon request copies of the
Letters of Credit. The Issuing Lender will provide to the Administrative
Agent promptly upon request a summary report of the nature and extent of
LOC Obligations then outstanding.
(c) Participations. Each Lender upon issuance of a Letter of
Credit shall be deemed to have purchased without recourse a risk
participation from the Issuing Lender in such Letter of Credit and the
obligations arising thereunder and any collateral relating thereto, in
each case in an amount equal to its LOC Commitment Percentage of the
obligations under such Letter of Credit and shall absolutely,
unconditionally and irrevocably assume, as primary obligor and not as
surety, and be obligated to pay to the Issuing Lender therefor and
discharge when due, its LOC Commitment Percentage of the obligations
arising under such Letter of Credit. Without limiting the scope and
nature of each Lender's participation in any Letter of Credit, to the
extent that the Issuing Lender has not been reimbursed as required
34
hereunder or under any LOC Document, each such Lender shall pay to the
Issuing Lender its LOC Commitment Percentage of such unreimbursed drawing
in same day funds on the day of notification by the Issuing Lender of an
unreimbursed drawing pursuant to the provisions of subsection (d) hereof.
The obligation of each Lender to so reimburse the Issuing Lender shall be
absolute and unconditional and shall not be affected by the occurrence of
a Default, an Event of Default or any other occurrence or event. Any such
reimbursement shall not relieve or otherwise impair the obligation of the
Borrower to reimburse the Issuing Lender under any Letter of Credit,
together with interest as hereinafter provided.
(d) Reimbursement. In the event of any drawing under any Letter of
Credit, the Issuing Lender will promptly notify the Borrower and the
Administrative Agent. The Borrower shall reimburse the Issuing Lender on
the day of drawing under any Letter of Credit (either with the proceeds
of a Swingline Loan or Revolving Loan obtained hereunder or otherwise) in
same day funds as provided herein or in the LOC Documents. If the
Borrower shall fail to reimburse the Issuing Lender as provided herein,
the unreimbursed amount of such drawing shall bear interest at a per
annum rate equal to the Alternate Base Rate plus two percent (2%) from
the date of such drawing until paid. Unless the Borrower shall
immediately notify the Issuing Lender and the Administrative Agent of its
intent to otherwise reimburse the Issuing Lender, the Borrower shall be
deemed to have requested a Swingline Loan, or if and to the extent
Swingline Loans shall not be available, a Revolving Loan in the amount of
the drawing as provided in subsection (e) hereof, the proceeds of which
will be used to satisfy the reimbursement obligations. The Borrower's
reimbursement obligations hereunder shall be absolute and unconditional
under all circumstances irrespective of any rights of set-off,
counterclaim or defense to payment the Borrower may claim or have against
the Issuing Lender, the Administrative Agent, the Lenders, the
beneficiary of the Letter of Credit drawn upon or any other Person,
including without limitation any defense based on any failure of the
Borrower to receive consideration or the legality, validity, regularity
or unenforceability of the Letter of Credit. The Issuing Lender will
promptly notify the other Lenders of the amount of any unreimbursed
drawing and each Lender shall promptly pay to the Administrative Agent
for the account of the Issuing Lender in Dollars and in immediately
available funds, the amount of such Lender's LOC Commitment Percentage of
such unreimbursed drawing. Such payment shall be made on the day such
notice is received by such Lender from the Issuing Lender if such notice
is received at or before 2:00 P.M. (Charlotte, North Carolina time),
otherwise such payment shall be made at or before 12:00 Noon (Charlotte,
North Carolina time) on the Business Day next succeeding the day such
notice is received. If such Lender does not pay such amount to the
Issuing Lender in full upon such request, such Lender shall, on demand,
pay to the Administrative Agent for the account of the Issuing Lender
interest on the unpaid amount during the period from the date of such
drawing until such Lender pays such amount to the Issuing Lender in full
at a rate per annum equal to, if paid within two (2) Business Days of the
date of drawing, the Federal Funds Effective Rate and thereafter at a
rate equal to the Alternate Base Rate. Each Lender's obligation to
35
make such payment to the Issuing Lender, and the right of the Issuing
Lender to receive the same, shall be absolute and unconditional, shall
not be affected by any circumstance whatsoever and without regard to the
termination of this Agreement or the Commitments hereunder, the existence
of a Default or Event of Default or the acceleration of the Credit Party
Obligations hereunder and shall be made without any offset, abatement,
withholding or reduction whatsoever.
(e) Repayment with Revolving Loans. On any day on which the
Borrower shall have requested, or been deemed to have requested, (i) a
Swingline Loan borrowing to reimburse a drawing under a Letter of Credit,
the Swingline Lender shall make the Swingline Loan advance pursuant to
the terms of the request or deemed request in accordance with the
provisions for Swingline Loan advances hereunder, or (ii) a Revolving
Loan to reimburse a drawing under a Letter of Credit, the Administrative
Agent shall give notice to the Lenders that a Revolving Loan has been
requested or deemed requested in connection with a drawing under a Letter
of Credit, in which case a Revolving Loan borrowing comprised entirely of
Alternate Base Rate Loans (each such borrowing, a "Mandatory Borrowing")
shall be immediately made (without giving effect to any termination of
the Commitments pursuant to Section 7.2) pro rata based on each Lender's
respective Revolving Commitment Percentage (determined before giving
effect to any termination of the Commitments pursuant to Section 7.2) and
in the case of both clauses (i) and (ii) the proceeds thereof shall be
paid directly to the Issuing Lender for application to the respective LOC
Obligations. Each Lender hereby irrevocably agrees to make such Revolving
Loans immediately upon any such request or deemed request on account of
each Mandatory Borrowing in the amount and in the manner specified in the
preceding sentence and on the same such date (or next Business Day
pursuant to subsection (d) hereof) notwithstanding (i) the amount of
Mandatory Borrowing may not comply with the minimum amount for borrowings
of Revolving Loans otherwise required hereunder, (ii) whether any
conditions specified in Section 4.2 are then satisfied, (iii) whether a
Default or an Event of Default then exists, (iv) failure for any such
request or deemed request for Revolving Loan to be made by the time
otherwise required in Section 2.1(b), (v) the date of such Mandatory
Borrowing, or (vi) any reduction in the Revolving Committed Amount after
any such Letter of Credit may have been drawn upon; provided, however,
that in the event any such Mandatory Borrowing should be less than the
minimum amount for borrowings of Revolving Loans otherwise provided in
Section 2.1(b)(ii), the Borrower shall pay to the Administrative Agent
for its own account an administrative fee of $500. In the event that any
Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to
the Borrower), then each such Lender hereby agrees that it shall
forthwith fund (as of the date the Mandatory Borrowing would otherwise
have occurred, but adjusted for any payments received from the Borrower
on or after such date and prior to such purchase) its Participation
Interests in the outstanding LOC Obligations; provided, further, that in
the event any Lender shall fail to fund its Participation Interest on the
day the Mandatory Borrowing would otherwise have occurred, then the
amount of
36
such Lender's unfunded Participation Interest therein shall bear interest
payable to the Issuing Lender upon demand, at the rate equal to, if paid
within two (2) Business Days of such date, the Federal Funds Effective
Rate, and thereafter at a rate equal to the Alternate Base Rate.
(f) Modification, Extension. The issuance of any supplement,
modification, amendment, renewal, or extension to any Letter of Credit
shall, for purposes hereof, be treated in all respects the same as the
issuance of a new Letter of Credit hereunder.
(g) Uniform Customs and Practices. The Issuing Lender shall have
the Letters of Credit be subject to The Uniform Customs and Practice for
Documentary Credits, as published as of the date of issue by the
International Chamber of Commerce (the "UCP"), in which case the UCP may
be incorporated therein and deemed in all respects to be a part thereof.
Section 2.5 Fees.
(a) Commitment Fee. In consideration of the Revolving Commitment,
the Borrower agrees to pay to the Administrative Agent for the ratable
benefit of the Lenders a commitment fee (the "Commitment Fee") in an
amount equal to the Applicable Percentage per annum on the average daily
unused amount of the aggregate Revolving Committed Amount. For purposes
of computing the Commitment hereunder, Swingline Loans and Letters of
Credit shall be considered usage under the aggregate Revolving Committed
Amount. The Commitment Fee shall be payable quarterly in arrears on the
15th day following the last day of each calendar quarter for the prior
calendar quarter.
(b) Letter of Credit Fees. In consideration of the LOC
Commitments, the Borrower agrees to pay to the Issuing Lender a fee (the
"Letter of Credit Fee") equal to the Applicable Percentage per annum on
the average daily maximum amount available to be drawn under each Letter
of Credit from the date of issuance to the date of expiration. In
addition to such Letter of Credit Fee, the Issuing Lender may charge, and
retain for its own account without sharing by the other Lenders, an
additional facing fee of one-eighth of one percent (1/8%) per annum on
the average daily maximum amount available to be drawn under each such
Letter of Credit issued by it. The Issuing Lender shall promptly pay over
to the Administrative Agent for the ratable benefit of the Lenders
(including the Issuing Lender) the Letter of Credit Fee. The Letter of
Credit Fee shall be payable quarterly in arrears on the 15th day
following the last day of each calendar quarter for the prior calendar
quarter.
(c) Issuing Lender Fees. In addition to the Letter of Credit Fees
payable pursuant to subsection (b) hereof, the Borrower shall pay to the
Issuing Lender for its own account without sharing by the other Lenders
the reasonable and customary charges from time to time of the Issuing
Lender with respect to the amendment, transfer, administration,
cancellation and conversion of, and drawings under, such Letters of
Credit (collectively, the "Issuing Lender Fees").
37
(d) Administrative Fee. The Borrower agrees to pay to the
Administrative Agent the annual administrative fee as described in the
Fee Letter.
Section 2.6 Commitment Reductions.
(a) Voluntary Reductions. The Borrower shall have the right to
terminate or permanently reduce the unused portion of the Revolving
Committed Amount at any time or from time to time upon not less than five
Business Days' prior notice to the Administrative Agent (which shall
notify the Lenders thereof as soon as practicable) of each such
termination or reduction, which notice shall specify the effective date
thereof and the amount of any such reduction which shall be in a minimum
amount of $5,000,000 or a whole multiple of $1,000,000 in excess thereof
and shall be irrevocable and effective upon receipt by the Administrative
Agent, provided that no such reduction or termination shall be permitted
if after giving effect thereto, and to any prepayments of the Revolving
Loans made on the effective date thereof, the sum of the then outstanding
aggregate principal amount of the Revolving Loans plus Swingline Loans
plus LOC Obligations would exceed the Revolving Committed Amount.
(b) Mandatory Reductions. On any date that the Revolving Loans are
required to be prepaid pursuant to the terms of Section 2.7(b) (ii),
(iii) and (iv), the Revolving Committed Amount shall be automatically
permanently reduced by the amount of such required prepayment and/or
reduction.
(c) Revolving Commitment Termination Date. The Revolving
Commitment, the LOC Commitment and the Swingline Commitment shall
automatically terminate on the Revolving Commitment Termination Date.
Section 2.7 Prepayments.
(a) Optional Prepayments. The Borrower shall have the right to
prepay Loans in whole or in part from time to time; provided, however,
that each partial prepayment of Revolving Loans and Term Loans shall be
in a minimum principal amount of $1,000,000 and integral multiples of
$100,000 in excess thereof and each prepayment of Swingline Loans shall
be in a minimum principal amount of $100,000 and integral multiples of
$100,000 in excess thereof. The Borrower shall give three Business Days'
irrevocable notice in the case of LIBOR Rate Loans and one Business Day's
irrevocable notice in the case of Alternate Base Rate Loans, to the
Administrative Agent (which shall notify the Lenders thereof as soon as
practicable). Subject to the foregoing terms, amounts prepaid under this
Section 2.7(a) shall be applied as the Borrower may elect; provided that
if the Borrower fails to specify the application of an optional
prepayment then such prepayment shall be applied first to Revolving Loans
and then pro rata to the remaining principal installments of the Term
Loans, in each case first to Alternate Base Rate Loans and then to LIBOR
Rate Loans in direct order
38
of Interest Period maturities. All prepayments under this Section 2.7(a)
shall be subject to Section 2.17, but otherwise without premium or
penalty. Interest on the principal amount prepaid shall be payable on the
next occurring Interest Payment Date that would have occurred had such
loan not been prepaid or, at the request of the Administrative Agent,
interest on the principal amount prepaid shall be payable on any date
that a prepayment is made hereunder to the date of prepayment. Amounts
prepaid on the Swingline Loan and the Revolving Loans may be reborrowed
in accordance with the terms hereof. Amounts prepaid on the Term Loans
may not be reborrowed.
(b) Mandatory Prepayments.
(i) Revolving Committed Amount. If at any time after the
Closing Date, the sum of the aggregate principal amount of
outstanding Revolving Loans plus Swingline Loans plus LOC
Obligations shall exceed the Revolving Committed Amount, the
Borrower immediately shall prepay the Revolving Loans and
(after all Revolving Loans have been repaid) cash
collateralize the LOC Obligations, in an amount sufficient to
eliminate such excess.
(ii) Asset Dispositions. Promptly following any Asset
Disposition or series of Asset Dispositions in an aggregate
amount in excess of $10,000,000 in any fiscal year, the
Borrower shall prepay the Loans in an aggregate amount equal
to the Net Cash Proceeds derived from such Asset Dispositions
(such prepayment to be applied as set forth in clause (v)
below).
(iii) Debt Issuances. Immediately upon receipt by any Credit
Party of proceeds from any Debt Issuance (other than the
issuance of any Subordinated Debt which refinances the
Subordinated Debt under the Subordinated Note Indenture or the
issuance of any other Subordinated Debt after the Closing Date
up to an aggregate amount of $50,000,000), the Borrower shall
prepay the Loans in an aggregate amount equal to one-hundred
percent (100%) of the Net Cash Proceeds of such Debt Issuance
to the Lenders (such prepayment to be applied as set forth in
clause (v) below).
(iv) Recovery Event. To the extent of cash proceeds received
in connection with a Recovery Event which are in excess of
$10,000,000 in the aggregate and which are not applied in
accordance with Section 6.5(a)(ii), immediately following the
180th day occurring after the receipt by a Credit Party of
such cash proceeds, the Borrower shall prepay the Loans in an
aggregate amount equal to one-hundred percent (100%) of such
cash proceeds to the Lenders (such prepayment to be applied as
set forth in clause (v) below).
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(v) Application of Mandatory Prepayments. All amounts required
to be paid pursuant to this Section 2.7(b) shall be applied as
follows: (A) with respect to all amounts prepaid pursuant to
Section 2.7(b)(i), to Revolving Loans and (after all Revolving
Loans have been repaid) to a cash collateral account in
respect of LOC Obligations and (B) with respect to all amounts
prepaid pursuant to Sections 2.7(b)(ii) through (iv), (1)
first pro rata to the Term Loans (ratably to the remaining
principal installments thereof) and (2) second to the
Revolving Loans and (after all Revolving Loans have been
repaid) to a cash collateral account in respect of LOC
Obligations. Within the parameters of the applications set
forth above, prepayments shall be applied first to Alternate
Base Rate Loans and then to LIBOR Rate Loans in direct order
of Interest Period maturities. All prepayments under this
Section 2.7(b) shall be subject to Section 2.17 and be
accompanied by interest on the principal amount prepaid to the
date of prepayment.
Section 2.8 Minimum Principal Amount of Tranches.
All borrowings, payments and prepayments in respect of Revolving Loans
and Term Loans shall be in such amounts and be made pursuant to such elections
so that after giving effect thereto the aggregate principal amount of the
Revolving Loans and Term Loans comprising any Tranche shall not be less than
$3,000,000 or a whole multiple of $1,000,000 in excess thereof.
Section 2.9 Default Rate and Payment Dates.
Upon the occurrence, and during the continuance, of an Event of Default,
the principal of and, to the extent permitted by law, interest on the Loans and
any other amounts owing hereunder or under the other Credit Documents shall bear
interest, payable on demand, at a per annum rate 2% greater than the Alternate
Base Rate plus the Applicable Percentage then in effect.
Section 2.10 Conversion Options.
(a) The Borrower may, in the case of Revolving Loans and the Term
Loans, elect from time to time to convert Alternate Base Rate Loans to
LIBOR Rate Loans, by giving the Administrative Agent at least three
Business Days' prior irrevocable written notice of such election. A form
of Notice of Conversion/ Extension is attached as Schedule 2.10. If the
date upon which an Alternate Base Rate Loan is to be converted to a LIBOR
Rate Loan is not a Business Day, then such conversion shall be made on
the next succeeding Business Day and during the period from such last day
of an Interest Period to such succeeding Business Day such Loan shall
bear interest as if it were an Alternate Base Rate Loan. All or any part
of outstanding Alternate Base Rate Loans may be converted as provided
herein, provided that (i) no Loan may be converted into a LIBOR Rate Loan
when any Default or Event of Default has occurred and is continuing and
(ii) partial conversions shall be in an aggregate principal amount of
$3,000,000 or a whole multiple of $1,000,000 in excess thereof.
40
(b) Any LIBOR Rate Loans may be continued as such upon the
expiration of an Interest Period with respect thereto by compliance by
the Borrower with the notice provisions contained in Section 2.10(a);
provided, that no LIBOR Rate Loan may be continued as such when any
Default or Event of Default has occurred and is continuing, in which case
such Loan shall be automatically converted to an Alternate Base Rate Loan
at the end of the applicable Interest Period with respect thereto. If the
Borrower shall fail to give timely notice of an election to continue a
LIBOR Rate Loan, or the continuation of LIBOR Rate Loans is not permitted
hereunder, such LIBOR Rate Loans shall be automatically converted to
Alternate Base Rate Loans at the end of the applicable Interest Period
with respect thereto.
Section 2.11 Computation of Interest and Fees.
(a) Interest payable hereunder with respect to Alternate Base Rate
Loans shall be calculated on the basis of a year of 365 days (or 366
days, as applicable) for the actual days elapsed. All other fees,
interest and all other amounts payable hereunder shall be calculated on
the basis of a 360 day year for the actual days elapsed. The
Administrative Agent shall as soon as practicable notify the Borrower and
the Lenders of each determination of a LIBOR Rate on the Business Day of
the determination thereof. Any change in the interest rate on a Loan
resulting from a change in the Alternate Base Rate shall become effective
as of the opening of business on the day on which such change in the
Alternate Base Rate shall become effective. The Administrative Agent
shall as soon as practicable notify the Borrower and the Lenders of the
effective date and the amount of each such change.
(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error.
The Administrative Agent shall, at the request of the Borrower, deliver
to the Borrower a statement showing the computations used by the
Administrative Agent in determining any interest rate.
Section 2.12 Pro Rata Treatment and Payments.
Each borrowing of Revolving Loans and any reduction of the Revolving
Commitments shall be made pro rata according to the respective Commitment
Percentages of the Lenders. Each payment under this Agreement or any Note shall
be applied, first, to any fees then due and owing by the Borrower pursuant to
Section 2.5, second, to interest then due and owing in respect of the Notes of
the Borrower and, third, to principal then due and owing hereunder and under the
Notes of the Borrower. Each payment on account of any fees pursuant to Section
2.5 shall be made pro rata in accordance with the respective amounts due and
owing (except as to the portion of the Letter of Credit retained by the Issuing
Lender and the Issuing Lender Fees). Each payment (other than prepayments) by
the Borrower on account of principal of and interest on the Revolving Loans and
on the Term Loans shall be made pro rata according to the respective amounts due
and owing in accordance with Section 2.7 hereof. Each optional prepayment on
account of principal of the
41
Loans shall be applied, to such of the Loans as the Borrower may designate (to
be applied pro rata among the Lenders); provided, that prepayments made pursuant
to Section 2.15 shall be applied in accordance with such section. Each mandatory
prepayment on account of principal of the Loans shall be applied in accordance
with Section 2.7(b). All payments (including prepayments) to be made by the
Borrower on account of principal, interest and fees shall be made without
defense, set-off or counterclaim (except as provided in Section 2.18(b)) and
shall be made to the Administrative Agent for the account of the Lenders at the
Agent's office specified on Schedule 9.2 in Dollars and in immediately available
funds not later than 1:00 P.M. (Charlotte, North Carolina time) on the date when
due. The Administrative Agent shall distribute such payments to the Lenders
entitled thereto promptly upon receipt in like funds as received. If any payment
hereunder (other than payments on the LIBOR Rate Loans) becomes due and payable
on a day other than a Business Day, such payment shall be extended to the next
succeeding Business Day, and, with respect to payments of principal, interest
thereon shall be payable at the then applicable rate during such extension. If
any payment on a LIBOR Rate Loan becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day unless the result of such extension would be to extend such payment
into another calendar month, in which event such payment shall be made on the
immediately preceding Business Day.
Section 2.13 Non-Receipt of Funds by the Administrative Agent.
(a) Unless the Administrative Agent shall have been notified in
writing by a Lender prior to the date a Loan is to be made by such Lender
(which notice shall be effective upon receipt) that such Lender does not
intend to make the proceeds of such Loan available to the Administrative
Agent, the Administrative Agent may assume that such Lender has made such
proceeds available to the Administrative Agent on such date, and the
Administrative Agent may in reliance upon such assumption (but shall not
be required to) make available to the Borrower a corresponding amount. If
such corresponding amount is not in fact made available to the
Administrative Agent, the Administrative Agent shall be able to recover
such corresponding amount from such Lender. If such Lender does not pay
such corresponding amount forthwith upon the Administrative Agent's
demand therefor, the Administrative Agent will promptly notify the
Borrower, and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also
be entitled to recover from the Lender or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the
date such corresponding amount was made available by the Administrative
Agent to the Borrower to the date such corresponding amount is recovered
by the Administrative Agent at a per annum rate equal to (i) from the
Borrower at the applicable rate for the applicable borrowing pursuant to
the Notice of Borrowing and (ii) from a Lender at the Federal Funds
Effective Rate.
(b) Unless the Administrative Agent shall have been notified in
writing by the Borrower, prior to the date on which any payment is due
from it hereunder (which notice shall be effective upon receipt) that the
Borrower does not intend to make such payment, the Administrative Agent
may assume that such Borrower has made such payment when due, and
42
the Administrative Agent may in reliance upon such assumption (but shall
not be required to) make available to each Lender on such payment date an
amount equal to the portion of such assumed payment to which such Lender
is entitled hereunder, and if the Borrower has not in fact made such
payment to the Administrative Agent, such Lender shall, on demand, repay
to the Administrative Agent the amount made available to such Lender. If
such amount is repaid to the Administrative Agent on a date after the
date such amount was made available to such Lender, such Lender shall pay
to the Administrative Agent on demand interest on such amount in respect
of each day from the date such amount was made available by the
Administrative Agent to such Lender to the date such amount is recovered
by the Administrative Agent at a per annum rate equal to the Federal
Funds Effective Rate.
(c) A certificate of the Administrative Agent submitted to the
Borrower or any Lender with respect to any amount owing under this
Section 2.13 shall be conclusive in the absence of manifest error.
Section 2.14 Inability to Determine Interest Rate.
Notwithstanding any other provision of this Agreement, if (i) the
Administrative Agent shall reasonably determine (which determination shall be
conclusive and binding absent manifest error) that, by reason of circumstances
affecting the relevant market, reasonable and adequate means do not exist for
ascertaining LIBOR for such Interest Period, or (ii) the Required Lenders shall
reasonably determine (which determination shall be conclusive and binding absent
manifest error) that the LIBOR Rate does not adequately and fairly reflect the
cost to such Lenders of funding LIBOR Rate Loans that the Borrower has requested
be outstanding as a LIBOR Tranche during such Interest Period, the
Administrative Agent shall forthwith give telephone notice of such
determination, confirmed in writing, to the Borrower, and the Lenders at least
two Business Days prior to the first day of such Interest Period. Unless the
Borrower shall have notified the Administrative Agent upon receipt of such
telephone notice that it wishes to rescind or modify its request regarding such
LIBOR Rate Loans, any Loans that were requested to be made as LIBOR Rate Loans
shall be made as Alternate Base Rate Loans and any Loans that were requested to
be converted into or continued as LIBOR Rate Loans shall be converted into
Alternate Base Rate Loans. Until any such notice has been withdrawn by the
Administrative Agent, no further Loans shall be made as, continued as, or
converted into, LIBOR Rate Loans for the Interest Periods so affected.
Section 2.15 Illegality.
Notwithstanding any other provision of this Agreement, if the adoption of
or any change in any Requirement of Law or in the interpretation or application
thereof by the relevant Governmental Authority to any Lender shall make it
unlawful for such Lender or its LIBOR Lending Office to make or maintain LIBOR
Rate Loans as contemplated by this Agreement or to obtain in the interbank
eurodollar market through its LIBOR Lending Office the funds with which to make
such Loans, (a) such Lender shall promptly notify the Administrative Agent and
the Borrower thereof, (b) the commitment of such
43
Lender hereunder to make LIBOR Rate Loans or continue LIBOR Rate Loans as such
shall forthwith be suspended until the Administrative Agent shall give notice
that the condition or situation which gave rise to the suspension shall no
longer exist, and (c) such Lender's Loans then outstanding as LIBOR Rate Loans,
if any, shall be converted on the last day of the Interest Period for such Loans
or within such earlier period as required by law as Alternate Base Rate Loans.
The Borrower hereby agrees promptly to pay any Lender, upon its demand, any
additional amounts necessary to compensate such Lender for actual and direct
costs (but not including anticipated profits) reasonably incurred by such Lender
in making any repayment in accordance with this Section including, but not
limited to, any interest or fees payable by such Lender to lenders of funds
obtained by it in order to make or maintain its LIBOR Rate Loans hereunder. A
certificate as to any additional amounts payable pursuant to this Section
submitted by such Lender, through the Administrative Agent, to the Borrower
shall be conclusive in the absence of manifest error. Each Lender agrees to use
reasonable efforts (including reasonable efforts to change its LIBOR Lending
Office) to avoid or to minimize any amounts which may otherwise be payable
pursuant to this Section; provided, however, that such efforts shall not cause
the imposition on such Lender of any additional costs or legal or regulatory
burdens deemed by such Lender in its sole discretion to be material.
Section 2.16 Requirements of Law.
(a) If the adoption of or any change in any Requirement of Law or
in the interpretation or application thereof or compliance by any Lender
with any request or directive (whether or not having the force of law)
from any central bank or other Governmental Authority made subsequent to
the date hereof:
(i) shall subject such Lender to any tax of any kind
whatsoever with respect to any Letter of Credit or any application
relating thereto, any LIBOR Rate Loan made by it, or change the
basis of taxation of payments to such Lender in respect thereof
(except for changes in the rate of tax on the overall net income
of such Lender);
(ii) shall impose, modify or hold applicable any reserve,
special deposit, compulsory loan or similar requirement against
assets held by, deposits or other liabilities in or for the
account of, advances, loans or other extensions of credit by, or
any other acquisition of funds by, any office of such Lender which
is not otherwise included in the determination of the LIBOR Rate
hereunder; or
(iii) shall impose on such Lender any other condition;
and the result of any of the foregoing is to increase the cost to such
Lender of making or maintaining LIBOR Rate Loans or the Letters of Credit
or to reduce any amount receivable hereunder or under any Note, then, in
any such case, the Borrower shall promptly pay such Lender,
44
upon its demand, any additional amounts necessary to compensate such
Lender for such additional cost or reduced amount receivable which such
Lender reasonably deems to be material as determined by such Lender with
respect to its LIBOR Rate Loans or Letters of Credit. A certificate as to
any additional amounts payable pursuant to this Section submitted by such
Lender, through the Administrative Agent, to the Borrower shall be
conclusive in the absence of manifest error. Each Lender agrees to use
reasonable efforts (including reasonable efforts to change its Domestic
Lending Office or LIBOR Lending Office, as the case may be) to avoid or
to minimize any amounts which might otherwise be payable pursuant to this
paragraph of this Section; provided, however, that such efforts shall not
cause the imposition on such Lender of any additional costs or legal or
regulatory burdens deemed by such Lender to be material.
(b) If any Lender shall have reasonably determined that the
adoption of or any change in any Requirement of Law regarding capital
adequacy or in the interpretation or application thereof or compliance by
such Lender or any corporation controlling such Lender with any request
or directive regarding capital adequacy (whether or not having the force
of law) from any central bank or Governmental Authority made subsequent
to the date hereof does or shall have the effect of reducing the rate of
return on such Lender's or such corporation's capital as a consequence of
its obligations hereunder to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's or such corporation's
policies with respect to capital adequacy) by an amount reasonably deemed
by such Lender to be material, then from time to time, within fifteen
(15) days after demand by such Lender, the Borrower shall pay to such
Lender such additional amount as shall be certified by such Lender as
being required to compensate it for such reduction. Such a certificate as
to any additional amounts payable under this Section submitted by a
Lender (which certificate shall include a description of the basis for
the computation), through the Administrative Agent, to the Borrower shall
be conclusive absent manifest error.
(c) The agreements in this Section 2.16 shall survive the
termination of this Agreement and payment of the Notes and all other
amounts payable hereunder.
Section 2.17 Indemnity.
The Borrower hereby agrees to indemnify each Lender and to hold such
Lender harmless from any funding loss or expense which such Lender may sustain
or incur as a consequence of (a) default by the Borrower in payment of the
principal amount of or interest on any Loan by such Lender in accordance with
the terms hereof, (b) default by the Borrower in accepting a borrowing after the
Borrower has given a notice in accordance with the terms hereof, (c) default by
the Borrower in making any prepayment after the Borrower has given a notice in
accordance with the terms hereof, and/or (d) the making by the Borrower of a
prepayment of a Loan, or the conversion thereof, on a day which is not the last
day of the Interest Period with
45
respect thereto, in each case including, but not limited to, any such loss or
expense arising from interest or fees payable by such Lender to lenders of funds
obtained by it in order to maintain its Loans hereunder. A certificate as to any
additional amounts payable pursuant to this Section submitted by any Lender,
through the Administrative Agent, to the Borrower (which certificate must be
delivered to the Administrative Agent within thirty days following such default,
prepayment or conversion) shall be conclusive in the absence of manifest error.
The agreements in this Section shall survive termination of this Agreement and
payment of the Notes and all other amounts payable hereunder.
Section 2.18 Taxes.
(a) All payments made by the Borrower hereunder or under any Note
will be, except as provided in Section 2.18(b), made free and clear of,
and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever
nature now or hereafter imposed by any Governmental Authority or by any
political subdivision or taxing authority thereof or therein with respect
to such payments (but excluding any tax imposed on or measured by the net
income or profits of a Lender) and all interest, penalties or similar
liabilities with respect thereto (all such non-excluded taxes, levies,
imposts, duties, fees, assessments or other charges being referred to
collectively as "Taxes"). If any Taxes are so levied or imposed, the
Borrower agrees to pay the full amount of such Taxes, and such additional
amounts as may be necessary so that every payment of all amounts due
under this Agreement or under any Note, after withholding or deduction
for or on account of any Taxes, will not be less than the amount provided
for herein or in such Note. The Borrower will furnish to the
Administrative Agent as soon as practicable after the date the payment of
any Taxes is due pursuant to applicable law certified copies (to the
extent reasonably available and required by law) of tax receipts
evidencing such payment by the Borrower. The Borrower agrees to indemnify
and hold harmless each Lender, and reimburse such Lender upon its written
request, for the amount of any Taxes so levied or imposed and paid by
such Lender but excluding any interest or penalties caused by such
Lender's failure to pay any such taxes when due.
(b) Each Lender that is not a United States person (as such term
is defined in Section 7701(a)(30) of the Code) agrees to deliver to the
Borrower and the Administrative Agent on or prior to the Closing Date, or
in the case of a Lender that is an assignee or transferee of an interest
under this Agreement pursuant to Section 9.6(c) (unless the respective
Lender was already a Lender hereunder immediately prior to such
assignment or transfer), on the date of such assignment or transfer to
such Lender, (i) if the Lender is a "bank" within the meaning of Section
881(c)(3)(A) of the Code, two accurate and complete original signed
copies of Internal Revenue Service Form 4224 or 1001 (or successor forms)
certifying such Lender's entitlement to a complete exemption from United
States withholding tax with respect to payments to be made under this
Agreement and under any Note, or (ii) if the Lender is not a "bank"
within the meaning of Section 881(c)(3)(A) of the Code,
46
either Internal Revenue Service Form 1001 or 4224 as set forth in clause
(i) above, or (x) a certificate substantially in the form of Schedule
2.18 (any such certificate, a "2.18 Certificate") and (y) two accurate
and complete original signed copies of Internal Revenue Service Form W-8
(or successor form) certifying such Lender's entitlement to an exemption
from United States withholding tax with respect to payments of interest
to be made under this Agreement and under any Note. In addition, each
Lender agrees that it will deliver upon the Borrower's request updated
versions of the foregoing, as applicable, whenever the previous
certification has become obsolete or inaccurate in any material respect,
together with such other forms as may be required in order to confirm or
establish the entitlement of such Lender to a continued exemption from or
reduction in United States withholding tax with respect to payments under
this Agreement and any Note. Notwithstanding anything to the contrary
contained in Section 2.18(a), but subject to the immediately succeeding
sentence, (x) the Borrower shall be entitled, to the extent it is
required to do so by law, to deduct or withhold Taxes imposed by the
United States (or any political subdivision or taxing authority thereof
or therein) from interest, fees or other amounts payable hereunder for
the account of any Lender which is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for U.S. Federal
income tax purposes to the extent that such Lender has not provided to
the Borrower U.S. Internal Revenue Service Forms that establish a
complete exemption from such deduction or withholding and (y) the
Borrower shall not be obligated pursuant to Section 2.18(a) hereof to
gross-up payments to be made to a Lender in respect of Taxes imposed by
the United States if (I) such Lender has not provided to the Borrower the
Internal Revenue Service Forms required to be provided to the Borrower
pursuant to this Section 2.18(b) or (II) in the case of a payment, other
than interest, to a Lender described in clause (ii) above, to the extent
that such Forms do not establish a complete exemption from withholding of
such Taxes. Notwithstanding anything to the contrary contained in the
preceding sentence or elsewhere in this Section 2.18, the Borrower agrees
to pay additional amounts and to indemnify each Lender in the manner set
forth in Section 2.18(a) (without regard to the identity of the
jurisdiction requiring the deduction or withholding) in respect of any
amounts deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes after the Closing Date in
any applicable law, treaty, governmental rule, regulation, guideline or
order, or in the interpretation thereof, relating to the deducting or
withholding of Taxes.
(c) Each Lender agrees to use reasonable efforts (including
reasonable efforts to change its Domestic Lending Office or LIBOR Lending
Office, as the case may be) to avoid or to minimize any amounts which
might otherwise be payable pursuant to this Section; provided, however,
that such efforts shall not cause the imposition on such Lender of any
additional costs or legal or regulatory burdens deemed by such Lender in
its sole discretion to be material.
(d) If the Borrower pays any additional amount pursuant to this
Section 2.18 with respect to a Lender, such Lender shall use reasonable
47
efforts to obtain a refund of tax or credit against its tax liabilities
on account of such payment; provided that such Lender shall have no
obligation to use such reasonable efforts if either (i) it is in an
excess foreign tax credit position or (ii) it believes in good faith, in
its sole discretion, that claiming a refund or credit would cause adverse
tax consequences to it. In the event that such Lender receives such a
refund or credit, such Lender shall pay to the Borrower an amount that
such Lender reasonably determines is equal to the net tax benefit
obtained by such Lender as a result of such payment by the Borrower. In
the event that no refund or credit is obtained with respect to the
Borrower's payments to such Lender pursuant to this Section 2.18, then
such Lender shall upon request provide a certification that such Lender
has not received a refund or credit for such payments. Nothing contained
in this Section 2.18 shall require a Lender to disclose or detail the
basis of its calculation of the amount of any tax benefit or any other
amount or the basis of its determination referred to in the proviso to
the first sentence of this Section 2.18 to the Borrower or any other
party.
(e) The agreements in this Section 2.18 shall survive the
termination of this Agreement and the payment of the Notes and all other
amounts payable hereunder.
Section 2.19 Indemnification; Nature of Issuing Lender's Duties.
(a) In addition to its other obligations under Section 2.4, the
Borrower hereby agrees to protect, indemnify, pay and save each Issuing
Lender harmless from and against any and all claims, demands,
liabilities, damages, losses, costs, charges and expenses (including
reasonable attorneys' fees) that the Issuing Lender may incur or be
subject to as a consequence, direct or indirect, of (i) the issuance of
any Letter of Credit or (ii) the failure of the Issuing Lender to honor a
drawing under a Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or de
facto government or governmental authority (all such acts or omissions,
herein called "Government Acts").
(b) As between the Borrower and the Issuing Lender, the Borrower
shall assume all risks of the acts, omissions or misuse of any Letter of
Credit by the beneficiary thereof. The Issuing Lender shall not be
responsible: (i) for the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any party in
connection with the application for and issuance of any Letter of Credit,
even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) for the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, that may prove to be
invalid or ineffective for any reason; (iii) for failure of the
beneficiary of a Letter of Credit to comply fully with conditions
required in order to draw upon a Letter of Credit; (iv) for errors,
omissions, interruptions or delays in transmission or delivery of any
48
messages, by mail, cable, telegraph, telex or otherwise, whether or not
they be in cipher; (v)for errors in interpretation of technical terms;
(vi) for any loss or delay in the transmission or otherwise of any
document required in order to make a drawing under a Letter of Credit or
of the proceeds thereof; and (vii) for any consequences arising from
causes beyond the control of the Issuing Lender, including, without
limitation, any Government Acts. None of the above shall affect, impair,
or prevent the vesting of the Issuing Lender's rights or powers
hereunder.
(c) In furtherance and extension and not in limitation of the
specific provisions hereinabove set forth, any action taken or omitted by
the Issuing Lender, under or in connection with any Letter of Credit or
the related certificates, if taken or omitted in good faith, shall not
put such Issuing Lender under any resulting liability to the Borrower. It
is the intention of the parties that this Agreement shall be construed
and applied to protect and indemnify the Issuing Lender against any and
all risks involved in the issuance of the Letters of Credit, all of which
risks are hereby assumed by the Borrower, including, without limitation,
any and all risks of the acts or omissions, whether rightful or wrongful,
of any Government Authority. The Issuing Lender shall not, in any way, be
liable for any failure by the Issuing Lender or anyone else to pay any
drawing under any Letter of Credit as a result of any Government Acts or
any other cause beyond the control of the Issuing Lender.
(d) Nothing in this Section 2.19 is intended to limit the
reimbursement obligation of the Borrower contained in Section 2.4(d)
hereof. The obligations of the Borrower under this Section 2.19 shall
survive the termination of this Agreement. No act or omissions of any
current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Issuing Lender to enforce any right,
power or benefit under this Agreement.
(e) Notwithstanding anything to the contrary contained in this
Section 2.19, the Borrower shall have no obligation to indemnify any
Issuing Lender in respect of any liability incurred by such Issuing
Lender arising out of the gross negligence or willful misconduct of the
Issuing Lender (including action not taken by an Issuing Lender), as
determined by a court of competent jurisdiction.
Section 2.20 Replacement of Lender.
If any Lender delivers a notice pursuant to Section 2.16 (hereinafter any
such Lender shall be referred to as a "Replaced Lender"), then in such case, the
Borrower may, upon at least five (5) Business Days' notice to the Administrative
Agent and such Replaced Lender, designate a replacement lender (a "Replacement
Lender") acceptable to the Administrative Agent in its reasonable discretion, to
which such Replaced Lender shall, subject to its receipt (unless a later date
for the remittance thereof shall be agreed upon by the Borrower and the Replaced
Lender) of all amounts owed to such Replaced Lender hereunder, assign all (but
not less than all) of its rights and obligations hereunder. Upon any assignment
by any Lender pursuant to this
49
Section 2.20 becoming effective, the Replacement Lender shall thereupon be
deemed to be a "Lender" for all purposes of this Agreement and such Replaced
Lender shall thereupon cease to be a "Lender" for all purposes of this Agreement
and shall have no further rights or obligations hereunder (other than pursuant
to Sections 2.14, 2.15, 2.16 or 9.5 while such Replaced Lender was a Lender).
ARTICLE III
REPRESENTATIONS AND WARRANTIES
To induce the Lenders to enter into this Agreement and to make the
Extensions of Credit herein provided for, the Borrower hereby represents and
warrants to the Administrative Agent and to each Lender that:
Section 3.1 Financial Condition.
The balance sheets and the related statements of income and of cash flows
of the Borrower for fiscal year 1997 audited by Ernst & Young LLP are complete
and correct and present fairly the financial condition of the Borrower and its
Subsidiaries as of such dates. All such financial statements, including the
related schedules and notes thereto, have been prepared in accordance with GAAP
applied consistently throughout the periods involved (except as disclosed
therein).
Section 3.2 No Change.
Since January 3, 1998 (and after delivery of annual audited financial
statements in accordance Section 5.1(a), from the date of the most recently
delivered annual audited financial statements) there has been no development or
event which has had or could reasonably be expected to have a Material Adverse
Effect.
Section 3.3 Corporate Existence; Compliance with Law.
Each of the Borrower and its Subsidiaries (a) is duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
organization, (b) has the requisite power and authority and the legal right to
own and operate all its material property, to lease the material property it
operates as lessee and to conduct the business in which it is currently engaged,
(c) is duly qualified to conduct business and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or the
conduct of its business requires such qualification except to the extent that
the failure to so qualify or be in good standing could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect and (d) is in
compliance with all Requirements of Law except to the extent that the failure to
comply therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
50
Section 3.4 Corporate Power; Authorization; Enforceable Obligations.
Each of the Borrower and the other Credit Parties has full power and
authority and the legal right to make, deliver and perform the Credit Documents
to which it is party and has taken all necessary limited liability company or
corporate action to authorize the execution, delivery and performance by it of
the Credit Documents to which it is party. No consent or authorization of,
filing with, notice to or other act by or in respect of, any Governmental
Authority or any other Person is required in connection with the borrowings
hereunder or with the execution, delivery or performance of any Credit Document
by the Borrower or the other Credit Parties (other than those which have been
obtained) or with the validity or enforceability of any Credit Document against
the Borrower or the other Credit Parties (except such filings as are necessary
in connection with the perfection of the Liens created by such Credit
Documents). Each Credit Document to which it is a party has been duly executed
and delivered on behalf of the Borrower or the other Credit Parties, as the case
may be. Each Credit Document to which it is a party constitutes a legal, valid
and binding obligation of the Borrower or the other Credit Parties, as the case
may be, enforceable against the Borrower or such other Credit Party, as the case
may be, in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at law).
Section 3.5 No Legal Bar; No Default.
The execution, delivery and performance of the Credit Documents, the
borrowings thereunder and the use of the proceeds of the Loans will not violate
any Requirement of Law or any Contractual Obligation of the Borrower or its
Subsidiaries (except those as to which waivers or consents have been obtained),
and will not result in, or require, the creation or imposition of any Lien on
any of its or their respective properties or revenues pursuant to any
Requirement of Law or Contractual Obligation other than the Liens arising under
or contemplated in connection with the Credit Documents. Neither the Borrower
nor any of its Subsidiaries is in default under or with respect to any of its
Contractual Obligations in any respect which could reasonably be expected to
have a Material Adverse Effect. No Default or Event of Default has occurred and
is continuing.
Section 3.6 No Material Litigation.
Except as set forth in Schedule 3.6, no litigation, investigation or
proceeding of or before any arbitrator or Governmental Authority is pending or,
to the best knowledge of the Borrower, threatened by or against the Borrower or
any of its Subsidiaries or against any of its or their respective properties or
revenues (a) with respect to the Credit Documents or any Loan or any of the
transactions contemplated hereby, or (b) which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect.
51
Section 3.7 Investment Company Act.
Neither the Borrower nor any Credit Party is an "investment company", or
a company "controlled" by an "investment company", within the meaning of the
Investment Company Act of 1940, as amended.
Section 3.8 Margin Regulations.
No part of the proceeds of any Loan hereunder will be used directly or
indirectly for any purpose which violates, or which would be inconsistent with,
the provisions of Regulation T, U or X of the Board of Governors of the Federal
Reserve System as now and from time to time hereafter in effect. The Borrower
and its Subsidiaries taken as a group do not own "margin stock" except as
identified in the financial statements referred to in Section 3.1 and the
aggregate value of all "margin stock" owned by the Borrower and its Subsidiaries
taken as a group does not exceed 25% of the value of their assets.
Section 3.9 ERISA.
Except as set forth in Schedule 3.9, neither a Reportable Event nor an
"accumulated funding deficiency" (within the meaning of Section 412 of the Code
or Section 302 of ERISA) has occurred during the five-year period prior to the
date on which this representation is made or deemed made with respect to any
Plan, and each Plan has complied in all material respects with the applicable
provisions of ERISA and the Code, except to the extent that any such occurrence
or failure to comply would not reasonably be expected to have a Material Adverse
Effect. Except as set forth in Schedule 3.9, no termination of a Single Employer
Plan has occurred resulting in any liability that has remained underfunded, and
no Lien in favor of the PBGC or a Plan has arisen, during such five-year period
which could reasonably be expected to have a Material Adverse Effect. Except as
set forth in Schedule 3.9, the present value of all accrued benefits under each
Single Employer Plan (based on those assumptions used to fund such Plans) did
not, as of the last annual valuation date prior to the date on which this
representation is made or deemed made, exceed the value of the assets of such
Plan allocable to such accrued benefits by an amount which, as determined in
accordance with GAAP, could reasonably be expected to have a Material Adverse
Effect. Except as set forth in Schedule 3.9, neither the Borrower nor any
Commonly Controlled Entity is currently subject to any liability for a complete
or partial withdrawal from a Multiemployer Plan which could reasonably be
expected to have a Material Adverse Effect.
Section 3.10 Environmental Matters.
Except as set forth on Schedule 3.10 attached hereto or as could not
reasonably be expected to have a Material Adverse Effect,
(a) to the best knowledge of the Borrower, the facilities and
properties owned, leased or operated by the Borrower or any of its
Subsidiaries (the "Properties") do not contain any Materials of
52
Environmental Concern in amounts or concentrations which (i) constitute a
violation of, or (ii) could give rise to liability under, any
Environmental Law;
(b) to the best knowledge of the Borrower, the Properties and all
operations of the Borrower and/or its Subsidiaries at the Properties are
in compliance, and have in the last five years been in compliance, in all
material respects with all applicable Environmental Laws, and there is no
contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the business operated
by the Borrower or any of its Subsidiaries (the "Business");
(c) neither the Borrower nor any of its Subsidiaries has received
any written or actual notice of violation, alleged violation,
non-compliance, liability or potential liability regarding environmental
matters or compliance with Environmental Laws with regard to any of the
Properties or the Business, nor does the Borrower or any of its
Subsidiaries have knowledge or reason to believe that any such notice
will be received or is being threatened;
(d) to the best knowledge of the Borrower, Materials of
Environmental Concern have not been transported or disposed of from the
Properties in violation of, or in a manner or to a location which could
give rise to liability under any Environmental Law, nor have any
Materials of Environmental Concern been generated, treated, stored or
disposed of at, on or under any of the Properties in violation of, or in
a manner that could give rise to liability under, any applicable
Environmental Law;
(e) no judicial proceeding or governmental or administrative
action is pending or, to the knowledge of the Borrower, threatened, under
any Environmental Law to which the Borrower or any Subsidiary is or will
be named as a party with respect to the Properties or the Business, nor
are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or
judicial requirements outstanding under any Environmental Law with
respect to the Properties or the Business; and
(f) to the best knowledge of the Borrower, there has been no
release or threat of release of Materials of Environmental Concern at or
from the Properties, or arising from or related to the operations of the
Borrower or any Subsidiary in connection with the Properties or otherwise
in connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws.
Section 3.11 Purpose of Loans.
The proceeds of the Loans hereunder shall be used solely by the Borrower
to (i) finance a portion of the purchase price of the Acquired Business and to
pay certain fees and expenses related thereto, (ii) refinance existing
53
Indebtedness and (iii) provide for working capital and other general corporate
purposes. The Letters of Credit shall be used only for or in connection with
appeal bonds, reimbursement obligations arising in connection with surety and
reclamation bonds, reinsurance, domestic or international trade transactions and
obligations not otherwise aforementioned relating to transactions entered into
by the applicable account party in the ordinary course of business.
Section 3.12 Subsidiaries.
Set forth on Schedule 3.12 is a complete and accurate list of all
Subsidiaries of the Borrower. Each of such Subsidiaries is a Restricted
Subsidiary. Information on the attached Schedule includes state of
incorporation; the number of shares of each class of Capital Stock or other
equity interests outstanding; the number and percentage of outstanding shares of
each class of stock; and the number and effect, if exercised, of all outstanding
options, warrants, rights of conversion or purchase and similar rights. The
outstanding Capital Stock and other equity interests of all such Subsidiaries is
validly issued, fully paid and non-assessable and is owned, free and clear of
all Liens (other than those arising under or contemplated in connection with the
Credit Documents).
Section 3.13 Ownership.
Each of the Borrower and its Subsidiaries is the owner of, and has good
and marketable title to, all of its respective assets, except as may be
permitted pursuant Section 6.13 hereof, and none of such assets is subject to
any Lien other than Permitted Liens.
Section 3.14 Indebtedness.
Except as otherwise permitted under Section 6.1, the Borrower and its
Subsidiaries have no Indebtedness.
Section 3.15 Taxes.
Each of the Borrower and its Subsidiaries has filed, or caused to be
filed, all tax returns (federal, state, local and foreign) required to be filed
and paid (a) all amounts of taxes shown thereon to be due (including interest
and penalties) and (b) all other taxes, fees, assessments and other governmental
charges (including mortgage recording taxes, documentary stamp taxes and
intangibles taxes) owing by it, except for such taxes (i) which are not yet
delinquent, (ii) that are being contested in good faith and by proper
proceedings, and against which adequate reserves are being maintained in
accordance with GAAP or (iii) the non-payment of which could not reasonably be
expected to have a Material Adverse Effect. Neither the Borrower nor any of its
Subsidiaries is aware as of the Closing Date of any proposed tax assessments
against it or any of its Subsidiaries which could reasonably be expected to have
a Material Adverse Effect.
54
Section 3.16 Intellectual Property.
Each of the Borrower and its Subsidiaries owns, or has the legal right to
use, all trademarks, tradenames, copyrights, technology, know-how and processes
necessary for each of them to conduct its business as currently conducted. Set
forth on Schedule 3.16 is a list of all material Intellectual Property owned by
each of the Borrower and its Subsidiaries or that the Borrower or any of its
Subsidiaries has the right to use. Except as provided on Schedule 3.16, no claim
has been asserted and is pending by any Person challenging or questioning the
use of any such Intellectual Property or the validity or effectiveness of any
such Intellectual Property, nor does the Borrower or any of its Subsidiaries
know of any such claim, and, to the knowledge of the Borrower or any of its
Subsidiaries, the use of such Intellectual Property by the Borrower or any of
its Subsidiaries does not infringe on the rights of any Person, except for such
claims and infringements that in the aggregate, could not reasonably be expected
to have a Material Adverse Effect. Schedule 3.16 may be updated from time to
time by the Borrower to include new material Intellectual Property by giving
written notice thereof to the Administrative Agent.
Section 3.17 Solvency.
The fair saleable value of each Credit Party's assets, measured on a
going concern basis, exceeds all probable liabilities, including those to be
incurred pursuant to this Agreement. None of the Credit Parties (a) has
unreasonably small capital in relation to the business in which it is or
proposes to be engaged or (b) has incurred, or believes that it will incur after
giving effect to the transactions contemplated by this Agreement, debts beyond
its ability to pay such debts as they become due.
Section 3.18 Investments.
All Investments of each of the Borrower and its Subsidiaries are
Permitted Investments.
Section 3.19 Location of Collateral.
Set forth on Schedule 3.19(a) is a list of the Properties of the Borrower
and its Subsidiaries with street address, county and state where located. Set
forth on Schedule 3.19(b) is a list of all locations where any tangible personal
property of the Borrower and its Subsidiaries is located, including county and
state where located. Set forth on Schedule 3.19(c) is the chief executive office
and principal place of business of each of the Borrower and its Subsidiaries.
Schedule 3.19(a), 3.19(b) and 3.19(c) may be updated from time to time by the
Borrower to include new properties or locations by giving written notice thereof
to the Administrative Agent.
Section 3.20 No Burdensome Restrictions.
None of the Borrower or any of its Subsidiaries is a party to any
agreement or instrument or subject to any other obligation or any charter or
55
corporate restriction or any provision of any applicable law, rule or regulation
which, individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect.
Section 3.21 Brokers' Fees.
None of the Borrower or any of its Subsidiaries has any obligation to any
Person in respect of any finder's, broker's, investment banking or other similar
fee in connection with any of the transactions contemplated under the Credit
Documents other than the closing and other fees payable pursuant to this
Agreement.
Section 3.22 Labor Matters.
There are no collective bargaining agreements or Multiemployer Plans
covering the employees of the Borrower or any of its Subsidiaries as of the
Closing Date, other than as set forth in Schedule 3.22 hereto, and none of the
Borrower or any of its Subsidiaries (i) has suffered any strikes, walkouts, work
stoppages or other material labor difficulty within the last five years, other
than as set forth in Schedule 3.22 hereto or (ii) has knowledge of any potential
or pending strike, walkout or work stoppage.
Section 3.23 Accuracy and Completeness of Information.
All factual information heretofore, contemporaneously or hereafter
furnished by or on behalf of the Borrower or any of its Subsidiaries to the
Administrative Agent or any Lender for purposes of or in connection with this
Agreement or any other Credit Document, or any transaction contemplated hereby
or thereby, is or will be true and accurate in all material respects and not
incomplete by omitting to state any material fact necessary to make such
information not misleading. There is no fact now known to the Borrower or any of
its Subsidiaries which has, or could reasonably be expected to have, a Material
Adverse Effect which fact has not been set forth herein, in the financial
statements of the Borrower and its Subsidiaries furnished to the Administrative
Agent and/or the Lenders, or in any certificate, opinion or other written
statement made or furnished by the Borrower to the Administrative Agent and/or
the Lenders.
Section 3.24 Year 2000 Issue.
Except as could not reasonably be expected to have a Material Adverse
Effect, any reprogramming and related testing required to permit the proper
functioning of the Credit Parties' computer systems in and following the year
2000 will be completed in all material respects prior to September 1, 1999 (that
is, the Credit Parties will be "Year 2000 Compliant"), and the cost to the
Credit Parties of such reprogramming and testing will not result in a Default or
Event of Default or a Material Adverse Effect. Except for such reprogramming
referred to in the preceding sentence as may be necessary, the computer and
management information systems of the Credit Parties and their Subsidiaries are
and, with ordinary course upgrading and maintenance, will continue for the term
of this Agreement to be, adequate for the conduct of its business.
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ARTICLE IV
CONDITIONS PRECEDENT
Section 4.1 Conditions to Closing Date and Initial Revolving Loans and
Term Loans.
This Agreement shall become effective upon, and the obligation of each
Lender to make the initial Revolving Loans and Term Loans on the Closing Date
is subject to, the satisfaction of the following conditions precedent:
(a) Execution of Agreement. The Administrative Agent shall have
received (i) counterparts of this Agreement, executed by a duly
authorized officer of each party hereto, (ii) for the account of each
Lender, Revolving Notes and Term Notes, and for the account of the
Swingline Lender, a Swingline Note and (iii) counterparts of the Security
Agreement, in each case conforming to the requirements of this Agreement
and executed by duly authorized officers of the Credit Parties.
(b) Authority Documents. The Administrative Agent shall have
received the following:
(i) Articles of Incorporation. Copies of the articles of
incorporation or other charter documents, as applicable, of each
Credit Party certified to be true and complete as of a recent date
by the appropriate governmental authority of the state of its
incorporation.
(ii) Resolutions. Copies of resolutions of the board of
directors of each Credit Party approving and adopting the Credit
Documents, the transactions contemplated therein and authorizing
execution and delivery thereof, certified by an officer of such
Credit Party as of the Closing Date to be true and correct and in
force and effect as of such date.
(iii) Bylaws. A copy of the bylaws of each Credit Party
certified by an officer of such Credit Party as of the Closing Date
to be true and correct and in force and effect as of such date.
(iv) Good Standing. Copies of (i) certificates of good
standing, existence or its equivalent with respect to the each
Credit Party certified as of a recent date by the appropriate
governmental authorities of the state of incorporation and each
other state in which the failure to so qualify and be in good
standing could reasonably be expected to have a Material Adverse
Effect on the business or operations of the Borrower and its
Subsidiaries in such state and (ii) a certificate indicating
payment of all corporate franchise taxes certified as of a recent
date by the appropriate governmental taxing authorities from each
jurisdiction in which the failure to pay such franchise taxes could
reasonably be expected to have a Material Adverse Effect on the
business or operations of the Borrower and its Subsidiaries in such
jurisdiction.
57
(v) Incumbency. An incumbency certificate of each Credit
Party certified by a secretary or assistant secretary to be true
and correct as of the Closing Date substantially in the form of
Schedule 4.1(b) attached hereto.
(c) Legal Opinions of Counsel. The Administrative Agent shall
have received an opinion of King & Spalding, counsel for the Credit
Parties, dated the Closing Date and addressed to the Administrative Agent
and the Lenders, in form and substance acceptable to the Administrative
Agent.
(d) Personal Property Collateral. The Administrative Agent shall
have received, in form and substance satisfactory to the Administrative
Agent:
(i) searches of Uniform Commercial Code filings in the
jurisdiction of the chief executive office of each Credit Party and
each jurisdiction where any Collateral is located or where a filing
would need to be made in order to perfect the Administrative
Agent's security interest in the Collateral, copies of the
financing statements on file in such jurisdictions and evidence
that no Liens exist other than Permitted Liens;
(ii) duly executed UCC financing statements for each
appropriate jurisdiction as is necessary, in the Administrative
Agent's sole discretion, to perfect the Administrative Agent's
security interest in the Collateral; and
(iii) in the case of any personal property Collateral located
at premises leased by a Credit Party, such estoppel letters,
consents and waivers from the landlords on such real property as
may be reasonably required by the Administrative Agent on a "best
efforts" basis.
(e) Liability and Casualty Insurance. The Administrative Agent
shall have received copies of insurance policies or certificates of
insurance evidencing liability and casualty insurance meeting the
requirements set forth herein or in the Security Documents. The
Administrative Agent shall be named as loss payee and additional insured
on all such insurance policies for the benefit of the Lenders.
(f) Fees. The Administrative Agent shall have received all fees,
if any, owing pursuant to the Fee Letter and Section 2.5.
(g) Litigation. There shall not exist any pending litigation or
investigation affecting or relating to the Borrower or any of its
Subsidiaries, this Agreement and the other Credit Documents that in the
reasonable judgment of the Administrative Agent could materially
adversely affect the Borrower or any of its Subsidiaries, this Agreement
and the other Credit Documents, that has not been settled, dismissed,
vacated, discharged or terminated prior to the Closing Date.
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(h) Solvency Evidence. The Administrative Agent shall have
received an officer's certificate for each Credit Party prepared by the
chief financial officer or vice president-finance of each such Credit
Party as to the financial condition, solvency and related matters of each
such Credit Party, in each case after giving effect to the Acquisition
and the initial borrowings under the Credit Documents, in substantially
the form of Schedule 4.1(h) hereto.
(i) Account Designation Letter. The Administrative Agent shall
have received the executed Account Designation Letter in the form of
Schedule 1.1(a) hereto.
(j) Acquisition Documents. There shall not have been any
material modification, amendment, supplement or waiver to the Acquisition
Documents without the prior written consent of the Administrative Agent,
including, but not limited to, any modification, amendment, supplement or
waiver relating to the amount or type of consideration to be paid in
connection with the acquisition of the Acquired Business and the contents
of all disclosure schedules and exhibits, and the acquisition of the
Acquired Business shall have been consummated in accordance with the
terms of the Acquisition Documents (without waiver of any material
conditions precedent to the obligations of the buyer thereunder) with the
cash portion of the purchase price excluding transaction costs not to
exceed $90,000,000. The Administrative Agent shall have received final
copies of the Acquisition Documents, together with all exhibits and
schedules thereto, certified by an officer of the Borrower.
(k) Government Consent. The Administrative Agent shall have
received evidence that all governmental, shareholder and material third
party consents and approvals necessary in connection with the financings
and other transactions contemplated hereby have been obtained and all
applicable waiting periods have expired without any action being taken by
any authority that could restrain, prevent or impose any material adverse
conditions on such transactions or that could seek or threaten any of the
foregoing.
(l) Compliance with Laws. The financings and other transactions
contemplated hereby shall be in compliance with all applicable laws and
regulations (including all applicable securities and banking laws, rules
and regulations).
(m) Bankruptcy. There shall be no bankruptcy or insolvency
proceedings with respect to the Borrower or any of its Subsidiaries.
(n) Financial Statements. The Administrative Agent and each of
the Lenders shall have received copies of the financial statements
referred to in Section 3.1 hereof, each in form and substance
satisfactory to it.
(o) Year 2000 Plan. The Administrative Agent and each of the
Lenders shall have received the Borrower's plan for becoming Year 2000
Compliant, which plan shall be in form and substance satisfactory to the
Administrative Agent.
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(p) Environmental Reports. The Administrative Agent and each of
the Lenders shall have received satisfactory environmental reviews of all
real property owned by the Borrower and its Subsidiaries.
(q) Termination of Existing Indebtedness. All existing
Indebtedness for borrowed money of the Borrower and its Subsidiaries
(other than the existing Subordinated Debt and the Indebtedness listed on
Schedule 6.1(b)) and the Acquired Business and its Subsidiaries shall
have been repaid in full and terminated.
(r) Additional Matters. All other documents and legal matters in
connection with the transactions contemplated by this Agreement shall be
reasonably satisfactory in form and substance to the Administrative Agent
and its counsel.
Section 4.2 Conditions to All Extensions of Credit.
The obligation of each Lender to make any Extension of Credit hereunder
is subject to the satisfaction of the following conditions precedent on the
date of making such Extension of Credit:
(a) Representations and Warranties. The representations and
warranties made by the Credit Parties herein, in the Security Documents
or which are contained in any certificate furnished at any time under or
in connection herewith shall be true and correct in all material respects
on and as of the date of such Extension of Credit as if made on and as of
such date.
(b) No Default or Event of Default. No Default or Event of
Default shall have occurred and be continuing on such date or after
giving effect to the Extension of Credit to be made on such date unless
such Default or Event of Default shall have been waived in accordance
with this Agreement.
(c) Compliance with Commitments. Immediately after giving effect
to the making of any such Extension of Credit (and the application of the
proceeds thereof), (i) the sum of the aggregate principal amount of
outstanding Revolving Loans plus Swingline Loans plus LOC Obligations
shall not exceed the Revolving Committed Amount, (ii) the LOC Obligations
shall not exceed the LOC Committed Amount and (iii) the Swingline Loans
shall not exceed the Swingline Commitment.
(d) Additional Conditions to Revolving Loans. If such Loan is
made pursuant to Section 2.1, all conditions set forth in such Section
shall have been satisfied.
(e) Additional Conditions to Term Loans. If such Loan is made
pursuant to Section 2.2, all conditions set forth in such Section shall
have been satisfied.
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(f) Additional Conditions to Swingline Loan. If such Loan is
made pursuant to Section 2.3, all conditions set forth in such Section
shall have been satisfied.
(g) Additional Conditions to Letters of Credit. If such
Extension of Credit is made pursuant to Section 2.4, all conditions set
fort in such Section shall have been satisfied.
Each request for an Extension of Credit and each acceptance by the
Borrower of any such Extension of Credit shall be deemed to constitute a
representation and warranty by the Borrower as of the date of such Extension of
Credit that the applicable conditions in paragraphs (a) through (g) of this
Section have been satisfied.
ARTICLE V
AFFIRMATIVE COVENANTS
The Borrower hereby covenants and agrees that on the Closing Date, and
thereafter for so long as this Agreement is in effect and until the Commitments
have terminated, no Note remains outstanding and unpaid and the Credit Party
Obligations, together with interest, Commitment Fees and all other amounts
owing to the Administrative Agent or any Lender hereunder, are paid in full,
the Borrower shall, and shall cause each of its Subsidiaries (other than in the
case of Sections 5.1, 5.2 or 5.7 hereof), to:
Section 5.1 Financial Statements.
Furnish to the Administrative Agent and each of the Lenders:
(a) Annual Financial Statements. As soon as available, but in
any event within ninety (90) days after the end of each fiscal year of
the Borrower, a copy of the consolidated balance sheet of the Borrower
and its consolidated Subsidiaries as at the end of such fiscal year and
the related consolidated statements of income and retained earnings and
of cash flows of the Borrower and its consolidated Subsidiaries for such
year, audited by a firm of independent certified public accountants of
nationally recognized standing reasonably acceptable to the Required
Lenders, setting forth in each case in comparative form the figures for
the previous year, reported on without a "going concern" or like
qualification or exception, or qualification indicating that the scope of
the audit was inadequate to permit such independent certified public
accountants to certify such financial statements without such
qualification;
(b) Quarterly Financial Statements. As soon as available and in
any event within forty-five (45) days after the end of each of the first
three fiscal quarters of the Borrower, a company-prepared consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at
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the end of such period and related company-prepared statements of income
and retained earnings and of cash flows (year-to-date) for the Borrower
and its consolidated Subsidiaries for such quarterly period and for the
portion of the fiscal year ending with such period, in each case setting
forth in comparative form consolidated figures for the corresponding
period or periods of the preceding fiscal year (subject to normal
recurring year-end audit adjustments); and
(c) Annual Budget Plan. As soon as available, but in any event
within forty-five (45) days after the end of each fiscal year, a copy of
the detailed annual budget or plan of the Borrower for the next fiscal
year, in form and detail reasonably acceptable to the Administrative
Agent and the Required Lenders, together with a summary of the material
assumptions made in the preparation of such annual budget or plan;
all such financial statements to be complete and correct in all material
respects (subject, in the case of interim statements, to normal recurring
year-end audit adjustments) and to be prepared in reasonable detail and, in the
case of the annual and quarterly financial statements provided in accordance
with subsections (a) and (b) above, in accordance with GAAP applied
consistently throughout the periods reflected therein and further accompanied
by a description of, and an estimation of the effect on the financial
statements on account of, a change, if any, in the application of accounting
principles as provided in Section 1.3.
Section 5.2 Certificates; Other Information.
Furnish to the Administrative Agent and each of the Lenders:
(a) concurrently with the delivery of the financial statements
referred to in Section 5.1(a) above, a certificate of the independent
certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge
was obtained of any Default or Event of Default, except as specified in
such certificate;
(b) concurrently with the delivery of the financial statements
referred to in Sections 5.1(a) and 5.1(b) above, a certificate of a
Responsible Officer stating that, to the best of such Responsible
Officer's knowledge, each of the Credit Parties during such period
observed or performed in all material respects all of its covenants and
other agreements, and satisfied in all material respects every condition,
contained in this Agreement to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any
Default or Event of Default except as specified in such certificate and
such certificate shall include the calculations in reasonable detail
required to indicate compliance with Section 5.9 as of the last day of
such period;
(c) within thirty (30) days after the same are sent, copies of
all reports (other than those otherwise provided pursuant to Section 5.1
and those which are of a promotional nature) and other financial
information which the Borrower sends to its shareholders, and within
thirty days
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after the same are filed, copies of all financial statements and
non-confidential reports which the Borrower may make to, or file with the
Securities and Exchange Commission or any successor or analogous
Governmental Authority;
(d) within ninety (90) days after the end of each fiscal year of
the Borrower, a certificate containing information regarding the amount
of all Asset Dispositions, Debt Issuances, and Equity Issuances that were
made during the prior fiscal year and amounts received in connection with
any Recovery Event during the prior fiscal year;
(e) promptly upon receipt thereof, a copy of any "management
letter" submitted by independent accountants to the Borrower or any of
its Subsidiaries in connection with any annual, interim or special audit
of the books of such Person; and
(f) promptly, such additional financial and other information as
the Administrative Agent, on behalf of any Lender, may from time to time
reasonably request.
Section 5.3 Payment of Obligations.
Pay, discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, in accordance with industry practice
(subject, where applicable, to specified grace periods) all its material
obligations of whatever nature and any additional costs that are imposed as a
result of any failure to so pay, discharge or otherwise satisfy such
obligations, except when the amount or validity of such obligations and costs
is currently being contested in good faith by appropriate proceedings and
reserves, if applicable, in conformity with GAAP with respect thereto have been
provided on the books of the Borrower or its Subsidiaries, as the case may be.
Section 5.4 Conduct of Business and Maintenance of Existence.
Continue to engage in business of the same general type (i.e., textiles
and apparel) as now conducted by it on the Closing Date and preserve, renew and
keep in full force and effect its corporate existence and take all reasonable
action to maintain all rights, privileges and franchises necessary or desirable
in the normal conduct of its business; comply with all Contractual Obligations
and Requirements of Law applicable to it except to the extent that failure to
comply therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect.
Section 5.5 Maintenance of Property; Insurance.
(a) Keep all material property useful and necessary in its
business in good working order and condition (ordinary wear and tear and
obsolescence excepted);
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(b) Maintain with financially sound and reputable insurance
companies insurance on all its material property (including without
limitation its material tangible Collateral) in at least such amounts and
against at least such risks as are usually insured against in the same
general area by companies engaged in the same or a similar business; and
furnish to the Administrative Agent, upon written request, full
information as to the insurance carried; provided, however, that the
Borrower and its Subsidiaries may maintain self insurance plans to the
extent companies of similar size and in similar businesses do so. The
Administrative Agent shall be named as loss payee or mortgagee, as its
interest may appear, and/or additional insured with respect to any such
insurance providing coverage in respect of any Collateral, and each
provider of any such insurance shall agree, by endorsement upon the
policy or policies issued by it or by independent instruments furnished
to the Administrative Agent, that it will give the Administrative Agent
thirty (30) days prior written notice before any such policy or policies
shall be altered or canceled, and that no act or default of the Borrower
or any of its Subsidiaries or any other Person shall affect the rights of
the Administrative Agent or the Lenders under such policy or policies.
The present insurance coverage of the Borrower and its Subsidiaries is
outlined as to carrier, policy number, expiration date, type and amount
on Schedule 5.5(b); and
(c) In case of any material loss, damage to or destruction of the
Collateral of any Credit Party or any part thereof, such Credit Party
shall promptly give written notice thereof to the Administrative Agent
generally describing the nature and extent of such damage or destruction.
In case of any loss, damage to or destruction of the Collateral of any
Credit Party or any part thereof, such Credit Party, whether or not the
insurance proceeds, if any, received on account of such damage or
destruction shall be sufficient for that purpose, at such Credit Party's
cost and expense, will promptly repair or replace the Collateral of such
Credit Party so lost, damaged or destroyed.
Section 5.6 Inspection of Property; Books and Records; Discussions.
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made of
all dealings and transactions in relation to its businesses and activities; and
permit, during regular business hours and upon reasonable notice by the
Administrative Agent or any Lender, the Administrative Agent or any Lender to
visit and inspect any of its properties and examine and make abstracts from any
of its books and records (other than materials protected by the attorney-client
privilege and materials which the Borrower may not disclose without violation
of a confidentiality obligation binding upon it) at any reasonable time and as
often as may reasonably be desired, and to discuss the business, operations,
properties and financial and other condition of the Borrower and its
Subsidiaries with officers of the Borrower and its Subsidiaries and with its
independent certified public accountants.
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Section 5.7 Notices.
Give notice in writing to the Administrative Agent (which shall promptly
transmit such notice to each Lender) of:
(a) within five Business Days after the Borrower knows or has
reason to know thereof, the occurrence of any Default or Event of
Default;
(b) promptly, any default or event of default under any
Contractual Obligation of the Borrower or any of its Subsidiaries which
could reasonably be expected to have a Material Adverse Effect;
(c) promptly, any litigation, or any investigation or proceeding
known to the Borrower, affecting the Borrower or any of its Subsidiaries
which, if adversely determined, could reasonably be expected to have a
Material Adverse Effect;
(d) as soon as possible and in any event within thirty (30) days
after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to
any Plan, a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC (other than a Permitted Lien)
or a Plan or any withdrawal from, or the termination, Reorganization or
Insolvency of, any Multiemployer Plan or (ii) the institution of
proceedings or the taking of any other action by the PBGC or the Borrower
or any Commonly Controlled Entity or any Multiemployer Plan with respect
to the withdrawal from, or the terminating, Reorganization or Insolvency
of, any Plan; and
(e) promptly, any other development or event which could
reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this Section shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto. In
the case of any notice of a Default or Event of Default, the Borrower shall
specify that such notice is a Default or Event of Default notice on the face
thereof.
Section 5.8 Environmental Laws.
(a) Comply in all material respects with, and ensure compliance
in all material respects by all tenants and subtenants, if any, with, all
applicable Environmental Laws and obtain and comply in all material
respects with and maintain, and ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect;
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(b) Conduct and complete all investigations, studies, sampling
and testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all
lawful orders and directives of all Governmental Authorities regarding
Environmental Laws except to the extent that the same are being contested
in good faith by appropriate proceedings and the pendency of such
proceedings could not reasonably be expected to have a Material Adverse
Effect; and
(c) Defend, indemnify and hold harmless the Administrative Agent
and the Lenders, and their respective employees, agents, officers and
directors, from and against any and all claims, demands, penalties,
fines, liabilities, settlements, damages, costs and expenses of whatever
kind or nature known or unknown, contingent or otherwise, arising out of,
or in any way relating to the violation of, noncompliance with or
liability under, any Environmental Law applicable to the operations of
the Borrower any of its Subsidiaries or the Properties, or any orders,
requirements or demands of Governmental Authorities related thereto,
including, without limitation, reasonable attorney's and consultant's
fees, investigation and laboratory fees, response costs, court costs and
litigation expenses, except to the extent that any of the foregoing arise
out of the gross negligence or willful misconduct of the party seeking
indemnification therefor. The agreements in this paragraph shall survive
repayment of the Notes and all other amounts payable hereunder.
Section 5.9 Financial Covenants.
Commencing on the day immediately following the Closing Date, the
Borrower shall, and shall cause each of its Subsidiaries to, comply with the
following financial covenants:
(a) Leverage Ratio. The Leverage Ratio, as of the last day of
each fiscal quarter of the Borrower and its Restricted Subsidiaries prior
to the Collateral Release Date, shall at all times be less than or equal
to 4.50 to 1.0. The Leverage Ratio, as of the last day of each fiscal
quarter of the Borrower and its Restricted Subsidiaries after the
Collateral Release Date, shall at all times be less than or equal to 4.25
to 1.0.
(b) Senior Leverage Ratio. The Senior Leverage Ratio, as of the
last day of each fiscal quarter of the Borrower and its Restricted
Subsidiaries prior to the Collateral Release Date, shall at all times be
less than or equal to 3.50 to 1.0. The Senior Leverage Ratio, as of the
last day of each fiscal quarter of the Borrower and its Restricted
Subsidiaries after the Collateral Release Date, shall at all times be
less than or equal to 2.50 to 1.0.
(c) Funded Debt to Total Capitalization Ratio. The Funded Debt
to Total Capitalization Ratio, as of the last day of each fiscal quarter
of the Borrower and its Restricted Subsidiaries after the Collateral
Release Date, shall at all times be less than or equal to .60 to 1.0.
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(d) Interest Coverage Ratio. The Interest Coverage Ratio, as of
the last day of each fiscal quarter of the Borrower and its Restricted
Subsidiaries prior to the Collateral Release Date, shall be greater than
or equal to the following:
Period Ratio
Closing Date through the end of the
third fiscal quarter in fiscal year 1999 1.65 to 1.0
Thereafter 1.75 to 1.0
The Interest Coverage Ratio, as of the last day of each fiscal quarter of
the Borrower and its Restricted Subsidiaries after the Collateral Release
Date, shall at all times be greater than or equal to 2.25 to 1.0.
Section 5.10 Additional Subsidiary Guarantors.
The Credit Parties will cause each of their Domestic Subsidiaries which
are not Unrestricted Subsidiaries, whether newly formed, after acquired or
otherwise existing, to promptly become a Guarantor hereunder by way of
execution of a Joinder Agreement. The guaranty obligations of any such
Additional Credit Party shall be secured by, among other things, the Collateral
of the Additional Credit Party.
Section 5.11 Compliance with Law.
Each Credit Party will, and will cause each of its Subsidiaries to,
comply with all laws, rules, regulations and orders, and all applicable
restrictions imposed by all Governmental Authorities, applicable to it and its
property if noncompliance with any such law, rule, regulation, order or
restriction could reasonably be expected to have a Material Adverse Effect.
Section 5.12 Pledged Assets.
Each Credit Party will, and will cause each of its Subsidiaries to be
subject at all times to a first priority, perfected Lien with respect to all of
such Subsidiary's accounts receivable and inventory (subject in each case to
Permitted Liens) in favor of the Administrative Agent pursuant to the terms and
conditions of the Security Documents or such other security documents as the
Administrative Agent shall reasonably request. Each Credit Party shall, and
shall cause each of its Subsidiaries to, adhere to the covenants regarding the
location of personal property as set forth in the Security Documents.
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Section 5.13 Year 2000 Compliance.
The Credit Parties will promptly notify the Administrative Agent in the
event any Credit Party discovers or determines that any computer application
(including those of its suppliers, vendors and customers) that is material to
its or any of its Subsidiaries' business and operations will not be Year 2000
Compliant, except to the extent that such failure could not reasonably be
expected to have a Material Adverse Effect.
Section 5.14 Canadian Collateral.
As soon as practicable, but in any event within thirty (30) days after
the Closing Date, the Credit Parties will take all measures necessary to
perfect the security interest of the Administrative Agent in all Collateral
located in the province of Ontario, Canada. Furthermore, the Credit Parties
hereby covenant and agree that the aggregate dollar value of all Collateral
located at any time in the province xx Xxxxxx, Xxxxxx shall not exceed
$1,000,000 in the aggregate during the term of this Agreement.
ARTICLE VI
NEGATIVE COVENANTS
The Borrower hereby covenants and agrees that on the Closing Date, and
thereafter for so long as this Agreement is in effect and until the Commitments
have terminated, no Note remains outstanding and unpaid and the Credit Party
Obligations, together with interest, Commitment Fees and all other amounts
owing to the Administrative Agent or any Lender hereunder, are paid in full,
the Borrower shall, and shall cause each of its Subsidiaries, to:
Section 6.1 Indebtedness.
The Borrower will not, nor will it permit any Subsidiary to, contract,
create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising or existing under this Agreement, the
other Credit Documents and the existing Subordinated Debt;
(b) Indebtedness of the Borrower and its Restricted Subsidiaries
existing as of the Closing Date as referenced in the financial statements
referenced in Section 3.1 (and set out more specifically in Schedule
6.1(b)) hereto and renewals, refinancings or extensions thereof in a
principal amount not in excess of that outstanding as of the date of such
renewal, refinancing or extension; provided that the Existing Letters of
Credit set forth in Schedule 6.1(b) shall only be permitted hereunder for
a period 30 days following the Closing Date;
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(c) Indebtedness of the Borrower and its Restricted Subsidiaries
incurred after the Closing Date consisting of Capital Leases or
Indebtedness incurred to provide all or a portion of the purchase price
or cost of construction of an asset provided that (i) such Indebtedness
when incurred shall not exceed the purchase price or cost of construction
of such asset; (ii) no such Indebtedness shall be refinanced for a
principal amount in excess of the principal balance outstanding thereon
at the time of such refinancing; and (iii) the total amount of all such
Indebtedness shall not exceed $35,000,000 at any time outstanding;
(d) Unsecured intercompany Indebtedness among the Borrower and
its Subsidiaries, provided that any such Indebtedness shall be fully
subordinated to the Credit Party Obligations hereunder on terms
reasonably satisfactory to the Administrative Agent;
(e) Indebtedness and obligations owing under Hedging Agreements
relating to the Loans hereunder and other Hedging Agreements entered into
in order to manage existing or anticipated interest rate, exchange rate
or commodity price risks and not for speculative purposes;
(f) Indebtedness and obligations of Credit Parties owing under
documentary letters of credit for the purchase of goods or other
merchandise (but not under standby, direct pay or other letters of credit
except for the Letters of Credit hereunder) generally;
(g) Indebtedness in respect of Guaranty Obligations (other than
Guaranty Obligations permitted pursuant to Section 6.1(a)) in an
aggregate amount not to exceed $5,000,000 at any time outstanding;
(h) in addition to the Indebtedness otherwise permitted by this
Section 6.1, additional Subordinated Debt hereafter incurred by the
Borrower or any of its Restricted Subsidiaries provided that (i) such
Subordinated Debt shall be subordinated to the Credit Party Obligations
and shall not contain covenants, or default provisions or other
agreements relating to any Credit Party or terms of subordination that
are more restrictive (or, in the case of the terms of subordination, more
adverse to the Lenders) than the covenants, default provisions and other
agreements contained in the Credit Documents or in the Subordinated Note
Indenture, (ii) the interest rate on such Subordinated Debt shall not
exceed 12% per annum and principal shall not be payable earlier than one
year after the Maturity Date and (iii) the Borrower shall have
demonstrated to the Administrative Agent that, upon giving effect on a
pro forma basis to the incurrence of such Indebtedness and to the
concurrent retirement of any other Indebtedness of any Credit Party, no
Default or Event of Default would exist hereunder;
(i) Indebtedness and obligations under factoring arrangements in
respect of accounts owing by foreign account debtors in an aggregate
amount not to exceed (i) prior to the Collateral Release Date, $1,000,000
and (ii) after the Collateral Release Date, $3,000,000; and
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(j) other Indebtedness of the Borrower and its Subsidiaries which
does not exceed $5,000,000 in the aggregate at any time outstanding.
Section 6.2 Liens.
The Borrower will not, nor will it permit any Subsidiary to, contract,
create, incur, assume or permit to exist any Lien with respect to any of its
property or assets of any kind (whether real or personal, tangible or
intangible), whether now owned or hereafter acquired, except for Permitted
Liens.
Section 6.3 Guaranty Obligations.
The Borrower will not, nor will it permit any Subsidiary to, enter into
or otherwise become or be liable in respect of any Guaranty Obligations
(excluding specifically therefrom endorsements in the ordinary course of
business of negotiable instruments for deposit or collection) other than (i)
those in favor of the Lenders in connection herewith and (ii) Guaranty
Obligations by the Borrower or its Subsidiaries of Indebtedness permitted under
Section 6.1(g) (except, as regards Indebtedness under subsection (b) thereof,
only if and to the extent such Indebtedness was guaranteed on the Closing
Date).
Section 6.4 Nature of Business.
The Borrower will not, nor will it permit any Subsidiary to, alter the
character of its business in any material respect from that conducted as of the
Closing Date.
Section 6.5 Consolidation, Merger, Sale or Purchase of Assets, etc.
The Borrower will not, nor will it permit any Subsidiary to,
(a) dissolve, liquidate or wind up its affairs, sell, transfer,
lease or otherwise dispose of its property or assets or agree to do so at
a future time except the following, without duplication, shall be
expressly permitted:
(i) Specified Sales; and
(ii) the sale, transfer, lease or other disposition of
property or assets (a) to an unrelated party not in the ordinary
course of business (other than Specified Sales), where and to the
extent that they are the result of a Recovery Event or (b) the
sale, lease, transfer or other disposition of machinery, parts and
equipment no longer used or useful in the conduct of the business
of the Borrower or any of its Subsidiaries, as appropriate, in its
reasonable discretion, so long as the net proceeds therefrom are
used to repair or replace damaged property or to purchase or
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otherwise acquire new assets or property, provided that such
purchase or acquisition is committed to within 180 days of receipt
of the net proceeds and such purchase or acquisition is consummated
within 270 days of receipt of such proceeds;
(iii) the sale, lease or transfer of property or assets (at
fair value) between the Borrower and any Guarantor;
(iv) the sale, lease or transfer of property or assets from
a Credit Party other than the Borrower to another Credit Party; and
(v) the sale, lease or transfer of property or assets not
to exceed $10,000,000 in the aggregate in any fiscal year;
provided, that in each case (other than the liquidation of all or
substantially all of the assets of the Acquired Business into the
Borrower which shall be excluded for purposes hereof) at least 75% of the
consideration received therefor by the Borrower or any such Subsidiary is
in the form of cash or Cash Equivalents; or
(b) (i) purchase, lease or otherwise acquire (in a single
transaction or a series of related transactions) the property or assets
of any Person (other than purchases or other acquisitions of inventory,
leases, materials, property and equipment in the ordinary course of
business, except as otherwise limited or prohibited herein) provided that
so long as no Default or Event of Default shall have occurred and be
continuing or would result therefrom, the Borrower may acquire all or a
majority of the Capital Stock or other ownership interest in any Person
(in a similar or related line of business) or all or a substantial
portion of the assets, property and/or operations of a Person (in a
similar or related line of business) in an aggregate amount not to exceed
$25,000,000 in any fiscal year, or (ii) enter into any transaction of
merger or consolidation, except for (A) investments or acquisitions
permitted pursuant to Section 6.6, and (B) the merger or consolidation of
a Credit Party with and into another Credit Party, provided that if the
Borrower is a party thereto, the Borrower will be the surviving
corporation.
Section 6.6 Advances, Investments and Loans.
The Borrower will not, nor will it permit any Subsidiary to, lend money
or extend credit or make advances to any Person, or purchase or acquire any
stock, obligations or securities of, or any other interest in, or make any
capital contribution to, any Person except for Permitted Investments.
Section 6.7 Transactions with Affiliates.
Except as permitted in subsection (iv) of the definition of Permitted
Investments and otherwise to an extent not judged material by the Required
Lenders in their discretion, the Borrower will not, nor will it permit any
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Subsidiary to, enter into any transaction or series of transactions, whether or
not in the ordinary course of business, with any officer, director, shareholder
or Affiliate other than on terms and conditions substantially as favorable as
would be obtainable in a comparable arm's-length transaction with a Person
other than an officer, director, shareholder or Affiliate.
Section 6.8 Ownership of Subsidiaries; Restrictions.
The Borrower will not, nor will it permit any Subsidiary to, create, form
or acquire any Subsidiaries, except for Domestic Subsidiaries which are joined
as Additional Credit Parties in accordance with the terms hereof. The Borrower
will not sell, transfer, pledge or otherwise dispose of any Capital Stock or
other equity interests in any of its Subsidiaries, nor will it permit any of
its Subsidiaries to issue, sell, transfer, pledge or otherwise dispose of any
of their Capital Stock or other equity interests, except in a transaction
permitted by Section 6.5.
Section 6.9 Fiscal Year; Organizational Documents; Material Contracts.
The Borrower will not, nor will it permit any of its Subsidiaries to,
change its fiscal year. The Borrower will not, nor will it permit any
Subsidiary to, amend, modify or change its articles of incorporation (or
corporate charter or other similar organizational document) or bylaws (or other
similar document) without the prior written consent of the Required Lenders
unless any such amendment, modification or change could not reasonably be
expected to have a Material Adverse Effect. The Borrower will not, nor will it
permit any of its Subsidiaries to, without the prior written consent of the
Administrative Agent, amend, modify, cancel or terminate or fail to renew or
extend or permit the amendment, modification, cancellation or termination of
any of the Material Contracts, except in the event that such amendments,
modifications, cancellations or terminations could not reasonably be expected
to have a Material Adverse Effect.
Section 6.10 Limitation on Restricted Actions.
The Borrower will not, nor will it permit any Subsidiary to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective
any encumbrance or restriction on the ability of any such Person to (a) pay
dividends or make any other distributions to any Credit Party on its Capital
Stock or with respect to any other interest or participation in, or measured
by, its profits, (b) pay any Indebtedness or other obligation owed to any
Credit Party, (c) make loans or advances to any Credit Party, (d) sell, lease
or transfer any of its properties or assets to any Credit Party, or (e) act as
a Guarantor and pledge its assets pursuant to the Credit Documents or any
renewals, refinancings, exchanges, refundings or extension thereof, except (in
respect of any of the matters referred to in clauses (a)-(d) above) for such
encumbrances or restrictions existing under or by reason of (i) this Agreement
and the other Credit Documents, (ii) the Subordinated Debt, (iii) applicable
law, (iv) any document or instrument governing Indebtedness incurred pursuant
to Section 6.1(c), provided that any such restriction
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contained therein relates only to the asset or assets constructed or acquired
in connection therewith or (v) any Permitted Lien or any document or instrument
governing any Permitted Lien, provided that any such restriction contained
therein relates only to the asset or assets subject to such Permitted Lien.
Section 6.11 Restricted Payments.
The Borrower will not, nor will it permit any Subsidiary to, directly or
indirectly, declare, order, make or set apart any sum for or pay any Restricted
Payment, except (a) to make dividends payable solely in the same class of
Capital Stock of such Person, (b) to make dividends or other distributions
payable to any Credit Party (directly or indirectly through Subsidiaries), (c)
as permitted by Section 6.12 and (d) provided that no Default or Event of
Default has occurred and is continuing at such time or would be directly or
indirectly caused as a result thereof, the Borrower may pay cash dividends or
repurchase shares of its Capital Stock in an aggregate amount not to exceed
$5,000,000 in any fiscal year.
Section 6.12 Prepayments of Indebtedness, etc.
The Borrower will not, nor will it permit any Subsidiary to, (a) after
the issuance thereof, amend or modify (or permit the amendment or modification
of) any of the terms of any Indebtedness in excess of $5,000,000 if such
amendment or modification would add or change any terms in a manner adverse to
the issuer of such Indebtedness or the Lenders, or shorten the final maturity
or average life to maturity or require any payment to be made sooner than
originally scheduled or increase the interest rate applicable thereto or change
any subordination provision thereof, or (b) make (or give any notice with
respect thereto) any voluntary or optional payment or prepayment, redemption,
acquisition for value or defeasance of (including without limitation, by way of
depositing money or securities with the trustee with respect thereto before due
for the purpose of paying when due), refund, refinance or exchange of any
Subordinated Debt, except that so long as there is no Default or Event of
Default then in existence and subject to the terms and provisions of the
Subordinated Note Indenture or other document evidencing Subordinated Debt, the
Borrower shall be entitled to pay interest and scheduled principal payments
thereon in accordance with the terms of such Subordinated Debt.
Section 6.13 Sale Leasebacks.
The Borrower will not, nor will it permit any Subsidiary to, directly or
indirectly, become or remain liable as lessee or as guarantor or other surety
with respect to any lease, whether an operating lease or a Capital Lease, of
any property (whether real, personal or mixed), whether now owned or hereafter
acquired in excess of $5,000,000 in the aggregate on an annual basis, (a) which
the Borrower or any Subsidiary has sold or transferred or is to sell or
transfer to a Person which is not the Borrower or any Subsidiary or (b) which
the Borrower or any Subsidiary intends to use for substantially the same
purpose as any other property which has been sold or is to be sold or
transferred by the Borrower or any Subsidiary to another Person which is not
the Borrower or any Subsidiary in connection with such lease.
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Section 6.14 No Further Negative Pledges.
The Borrower will not, nor will it permit any Subsidiary to, enter into,
assume or become subject to any agreement prohibiting or otherwise restricting
the creation or assumption of any Lien upon its properties or assets, whether
now owned or hereafter acquired, or requiring the grant of any security for
such obligation if security is given for some other obligation, except (a)
pursuant to this Agreement and the other Credit Documents, (b) pursuant to the
terms of the Subordinated Debt, (c) pursuant to any document or instrument
governing Indebtedness incurred pursuant to Section 6.1(c), provided that any
such restriction contained therein relates only to the asset or assets
constructed or acquired in connection therewith and (d) in connection with any
Permitted Lien or any document or instrument governing any Permitted Lien,
provided that any such restriction contained therein relates only to the asset
or assets subject to such Permitted Lien.
ARTICLE VII
EVENTS OF DEFAULT
Section 7.1 Events of Default.
An Event of Default shall exist upon the occurrence of any of the
following specified events (each an "Event of Default"):
(a) The Borrower shall fail to pay any principal on any Note when
due in accordance with the terms thereof or hereof; or the Borrower shall
fail to reimburse the Issuing Lender for any LOC Obligations when due in
accordance with the terms hereof; or the Borrower shall fail to pay any
interest on any Note or any fee or other amount payable hereunder when
due in accordance with the terms thereof or hereof and such failure to
pay such interest, fee or other amount shall continue unremedied for
three (3) Business Days (or any Guarantor shall fail to pay on the
Guaranty in respect of any of the foregoing or in respect of any other
Guaranty Obligations thereunder); or
(b) Any representation or warranty made or deemed made herein, in
the Security Documents or in any of the other Credit Documents or which
is contained in any certificate, document or financial or other statement
furnished at any time under or in connection with this Agreement shall
prove to have been incorrect, false or misleading in any material respect
on or as of the date made or deemed made; or
(c) (i) Any Credit Party shall fail to perform, comply with or
observe any term, covenant or agreement applicable to it contained in
Section 5.7(a), Section 5.9 or Article VI hereof ; or (ii) any Credit
Party shall fail to comply with any other covenant, contained in this
Agreement or the other Credit Documents or any other agreement, document
or instrument among any Credit Party, the Administrative Agent and the
Lenders or executed by any Credit Party in favor of the Administrative
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Agent or the Lenders (other than as described in Sections 7.1(a) or
7.1(c)(i) above), and in the event such breach or failure to comply is
capable of cure, is not cured within thirty (30) days of its occurrence;
or
(d) The Borrower or any of its Subsidiaries shall (i) default in
any payment of principal of or interest on any Indebtedness (other than
the Notes) in a principal amount outstanding of at least $10,000,000 in
the aggregate for the Borrower and any of its Subsidiaries beyond the
period of grace (not to exceed 30 days), if any, provided in the
instrument or agreement under which such Indebtedness was created; or
(ii) default in the observance or performance of any other agreement or
condition relating to any Indebtedness in a principal amount outstanding
of at least $10,000,000 in the aggregate for the Borrower and its
Subsidiaries or contained in any instrument or agreement evidencing,
securing or relating thereto, or any other event shall occur or condition
exist, the effect of which default or other event or condition is to
cause, or to permit the holder or holders of such Indebtedness or
beneficiary or beneficiaries of such Indebtedness (or a trustee or agent
on behalf of such holder or holders or beneficiary or beneficiaries) to
cause, with the giving of notice if required, such Indebtedness to become
due prior to its stated maturity; or
(e) (i) The Borrower or any of its Subsidiaries shall commence
any case, proceeding or other action (A) under any existing or future law
of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order
for relief entered with respect to it, or seeking to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment, winding-up, liquidation, dissolution, composition or other
relief with respect to it or its debts, or (B) seeking appointment of a
receiver, trustee, custodian, conservator or other similar official for
it or for all or any substantial part of its assets, or the Borrower or
any Subsidiary shall make a general assignment for the benefit of its
creditors; or (ii) there shall be commenced against the Borrower or any
Subsidiary any case, proceeding or other action of a nature referred to
in clause (i) above which (A) results in the entry of an order for relief
or any such adjudication or appointment or (B) remains undismissed,
undischarged or unbonded for a period of 60 days; or (iii) there shall be
commenced against the Borrower or any Subsidiary any case, proceeding or
other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or any substantial part of its
assets which results in the entry of an order for any such relief which
shall not have been vacated, discharged, or stayed or bonded pending
appeal within 60 days from the entry thereof; or (iv) the Borrower or any
Subsidiary shall take any action in furtherance of, or indicating its
consent to, approval of, or acquiescence in, any of the acts set forth in
clause (i), (ii), or (iii) above; or (v) the Borrower or any Subsidiary
shall generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or
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(f) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a
liability (to the extent not paid when due or covered by insurance) of
$5,000,000 or more and all such judgments or decrees shall not have been
paid and satisfied, vacated, discharged, stayed or bonded pending appeal
within 30 days from the entry thereof; or
(g) (i) Any Person shall engage in any "prohibited transaction"
(as defined in Section 406 of ERISA or Section 4975 of the Code)
involving any Plan, (ii) any "accumulated funding deficiency" (as defined
in Section 302 of ERISA), whether or not waived, shall exist with respect
to any Plan or any Lien in favor of the PBGC or a Plan (other than a
Permitted Lien) shall arise on the assets of the Borrower or any Commonly
Controlled Entity, (iii) a Reportable Event shall occur with respect to,
or proceedings shall commence to have a trustee appointed, or a trustee
shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or
appointment of a Trustee is, in the reasonable opinion of the Required
Lenders, likely to result in the termination of such Plan for purposes of
Title IV of ERISA, (iv) any Single Employer Plan shall terminate for
purposes of Title IV of ERISA, (v) the Borrower, any of its Subsidiaries
or any Commonly Controlled Entity shall, or in the reasonable opinion of
the Required Lenders is likely to, incur any liability in connection with
a withdrawal from, or the Insolvency or Reorganization of, any
Multiemployer Plan or (vi) any other similar event or condition shall
occur or exist with respect to a Plan; and in each case in clauses (i)
through (vi) above, such event or condition, together with all other such
events or conditions, if any, could have a Material Adverse Effect; or
(h) Either (i) any "person" or "group" (as such terms are used in
Sections 13(d) and 14(d) of the Securities and Exchange Act of 1934, as
amended) becomes after the date hereof the "beneficial owner" (defined as
aforesaid), directly or indirectly, of more than 35% of the voting
control of the Borrower, or (ii) during any period of two consecutive
years, individuals who at the beginning of such period constituted the
Board of Directors of the Borrower (together with any new directors whose
election to such Board of Directors or whose nomination for election by
the stockholders of the Borrower was approved by a vote of 66 2/3% of the
directors still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously
so approved) cease for any reason to constitute a majority of the Board
of Directors of the Borrower then in office.; or
(i) The Guaranty or any provision thereof shall cease to be in
full force and effect or any Guarantor or any Person acting by or on
behalf of any Guarantor shall deny or disaffirm any Guarantor's
obligations under the Guaranty; or
(j) Any other Credit Document shall fail to be in full force and
effect or to give the Administrative Agent and/or the Lenders the
security interests, liens, rights, powers and privileges purported to be
created thereby (except as such documents may be terminated or no longer
76
in force and effect in accordance with the terms thereof, other than
those indemnities and provisions which by their terms shall survive); or
(k) There shall occur and be continuing any Event of Default
under and as defined in the indenture or other document evidencing the
Subordinated Debt or any of the Credit Party Obligations for any reason
shall cease to be designated as senior indebtedness thereunder.
Section 7.2 Acceleration; Remedies.
Upon the occurrence of an Event of Default, then, and in any such event,
(a) if such event is an Event of Default specified in Section 7.1(e) above,
automatically the Commitments shall immediately terminate and the Loans (with
accrued interest thereon), and all other amounts under the Credit Documents
(including without limitation the maximum amount of all contingent liabilities
under Letters of Credit) shall immediately become due and payable, and (b) if
such event is any other Event of Default, either or both of the following
actions may be taken: (i) with the written consent of the Required Lenders,
the Administrative Agent may, or upon the written request of the Required
Lenders, the Administrative Agent shall, by notice to the Borrower declare the
Commitments to be terminated forthwith, whereupon the Commitments shall
immediately terminate; and (ii) with the written consent of the Required
Lenders, the Administrative Agent may, or upon the written request of the
Required Lenders, the Administrative Agent shall, by notice of default to the
Borrower, declare the Loans (with accrued interest thereon) and all other
amounts owing under this Agreement and the Notes to be due and payable
forthwith and direct the Borrower to pay to the Administrative Agent cash
collateral as security for the LOC Obligations for subsequent drawings under
then outstanding Letters of Credit an amount equal to the maximum amount of
which may be drawn under Letters of Credit then outstanding, whereupon the same
shall immediately become due and payable.
ARTICLE VIII
THE ADMINISTRATIVE AGENT
Section 8.1 Appointment.
Each Lender hereby irrevocably designates and appoints First Union
National Bank as the Administrative Agent of such Lender under this Agreement,
and each such Lender irrevocably authorizes First Union National Bank, as the
Administrative Agent for such Lender, to take such action on its behalf under
the provisions of this Agreement and to exercise such powers and perform such
duties as are expressly delegated to the Administrative Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. Notwithstanding any provision to the contrary elsewhere in this
Agreement, the Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or otherwise exist against the Administrative Agent.
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Section 8.2 Delegation of Duties.
The Administrative Agent may execute any of its duties under this
Agreement by or through agents or attorneys-in-fact and shall be entitled to
advice of counsel concerning all matters pertaining to such duties. The
Administrative Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care.
Without limiting the foregoing, the Administrative Agent may appoint one of its
affiliates as its agent to perform the functions of the Administrative Agent
hereunder relating to the advancing of funds to the Borrower and distribution
of funds to the Lenders and to perform such other related functions of the
Administrative Agent hereunder as are reasonably incidental to such functions.
Section 8.3 Exculpatory Provisions.
Neither the Administrative Agent nor any of its officers, directors,
employees, agents, attorneys-in-fact or affiliates shall be (i) liable for any
action lawfully taken or omitted to be taken by it or such Person under or in
connection with this Agreement (except for its or such Person's own gross
negligence or willful misconduct) or (ii) responsible in any manner to any of
the Lenders for any recitals, statements, representations or warranties made by
the Borrower or any officer thereof contained in this Agreement or in any
certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of any of the Credit Documents or for any failure
of the Borrower to perform its obligations hereunder or thereunder. The
Administrative Agent shall not be under any obligation to any Lender to
ascertain or to inquire as to the observance or performance by the Borrower of
any of the agreements contained in, or conditions of, this Agreement, or to
inspect the properties, books or records of the Borrower.
Section 8.4 Reliance by Administrative Agent.
The Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any Note, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or
teletype message, statement, order or other document or conversation believed
by it in good faith to be genuine and correct and to have been signed, sent or
made by the proper Person or Persons and upon advice and statements of legal
counsel (including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless (a) a written notice of assignment, negotiation
or transfer thereof shall have been filed with the Administrative Agent and (b)
the Administrative Agent shall have received the written agreement of such
assignee to be bound hereby as fully and to the same extent as if such assignee
were an original Lender party hereto, in each case in form satisfactory to the
Administrative Agent. The Administrative Agent shall be fully justified in
failing or refusing to take any action under this Agreement unless it shall
first receive such advice or concurrence of the
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Required Lenders as it deems appropriate or it shall first be indemnified to
its satisfaction by the Lenders against any and all liability and expense which
may be incurred by it by reason of taking or continuing to take any such
action. The Administrative Agent shall in all cases be fully protected in
acting, or in refraining from acting, under any of the Credit Documents in
accordance with a request of the Required Lenders or all of the Lenders, as may
be required under this Agreement, and such request and any action taken or
failure to act pursuant thereto shall be binding upon all the Lenders and all
future holders of the Notes.
Section 8.5 Notice of Default.
The Administrative Agent shall not be deemed to have knowledge or notice
of the occurrence of any Default or Event of Default hereunder unless the
Administrative Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default or Event of Default and
stating that such notice is a "notice of default". In the event that the
Administrative Agent receives such a notice, the Administrative Agent shall
give prompt notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders; provided, however, that unless and
until the Administrative Agent shall have received such directions, the
Administrative Agent may (but shall not be obligated to) take such action, or
refrain from taking such action, with respect to such Default or Event of
Default as it shall deem advisable in the best interests of the Lenders except
to the extent that this Agreement expressly requires that such action be taken,
or not taken, only with the consent or upon the authorization of the Required
Lenders, or all of the Lenders, as the case may be.
Section 8.6 Non-Reliance on Administrative Agent and Other Lenders.
Each Lender expressly acknowledges that neither the Administrative Agent
nor any of its officers, directors, employees, agents, attorneys-in-fact or
affiliates has made any representation or warranty to it and that no act by the
Administrative Agent hereinafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to
make its Loans hereunder and enter into this Agreement. Each Lender also
represents that it will, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, operations, property, financial and other condition
and creditworthiness of the Borrower. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative
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Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, operations, property,
condition (financial or otherwise), prospects or creditworthiness of the
Borrower which may come into the possession of the Administrative Agent or any
of its officers, directors, employees, agents, attorneys-in-fact or affiliates.
Section 8.7 Indemnification.
The Lenders agree to indemnify the Administrative Agent in its capacity
hereunder (to the extent not reimbursed by the Borrower and without limiting
the obligation of the Borrower to do so), ratably according to their respective
Commitment Percentages in effect on the date on which indemnification is sought
under this Section, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements of any kind whatsoever which may at any time (including, without
limitation, at any time following the payment of the Notes) be imposed on,
incurred by or asserted against the Administrative Agent in any way relating to
or arising out of any Credit Document or any documents contemplated by or
referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Administrative Agent under or in
connection with any of the foregoing; provided, however, that no Lender shall
be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements to the extent resulting from the Administrative Agent's gross
negligence or willful misconduct, as determined by a court of competent
jurisdiction. The agreements in this Section 8.7 shall survive the termination
of this Agreement and payment of the Notes and all other amounts payable
hereunder.
Section 8.8 Administrative Agent in Its Individual Capacity.
The Administrative Agent and its affiliates may make loans to, accept
deposits from and generally engage in any kind of business with the Borrower as
though the Administrative Agent were not the Administrative Agent hereunder.
With respect to its Loans made or renewed by it and any Note issued to it, the
Administrative Agent shall have the same rights and powers under this Agreement
as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
Section 8.9 Successor Administrative Agent.
The Administrative Agent may resign as Administrative Agent upon 30 days'
prior notice to the Borrower and the Lenders. If the Administrative Agent
shall resign as Administrative Agent under this Agreement and the Notes, then
the Required Lenders shall appoint from among the Lenders a successor agent for
the Lenders, which successor agent shall be approved by the Borrower, whereupon
such successor agent shall succeed to the rights, powers and duties of the
Administrative Agent, and the term "Administrative Agent" shall mean such
successor agent effective upon such appointment and
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approval, and the former Administrative Agent's rights, powers and duties as
Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Notes. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this Section 8.9
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement.
Section 8.10 Syndication Agent and Documentation Agent.
Notwithstanding any other provision contained in this Agreement to the
contrary, the Syndication Agent and the Documentation Agent shall have no
duties or obligations with respect to this Agreement or the other Loan
Documents.
ARTICLE IX
MISCELLANEOUS
Section 9.1 Amendments, Waivers and Release of Collateral.
Neither this Agreement, nor any of the Notes, nor any of the other Credit
Documents, nor any terms hereof or thereof may be amended, supplemented, waived
or modified except in accordance with the provisions of this Section nor may be
released except as specifically provided herein or in the Security Documents or
in accordance with the provisions of this Section 9.1. The Required Lenders
may, or, with the written consent of the Required Lenders, the Administrative
Agent may, from time to time, (a) enter into with the Borrower written
amendments, supplements or modifications hereto and to the other Credit
Documents for the purpose of adding any provisions to this Agreement or the
other Credit Documents or changing in any manner the rights of the Lenders or
of the Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Required Lenders may specify in such instrument, any of the
requirements of this Agreement or the other Credit Documents or any Default or
Event of Default and its consequences or (c) release collateral in accordance
with the terms hereof or of any Security Document or on such other terms and
conditions as the Required Lenders may agree; provided, however, that no such
waiver and no such amendment, waiver, supplement, modification or release
shall:
(i) reduce the amount or extend the scheduled date of
maturity of any Loan or Note or any installment thereon, or reduce
the stated rate of any interest or fee payable hereunder (other
than interest at the increased post-default rate) or extend the
scheduled date of any payment thereof or increase the amount or
extend the expiration date of any Lender's Commitment, in each case
without the written consent of each Lender directly affected
thereby, or
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(ii) amend, modify or waive any provision of this Section
9.1 or reduce the percentage specified in the definition of
Required Lenders, without the written consent of all the Lenders,
or
(iii) amend, modify or waive any provision of Article VIII
without the written consent of the then Administrative Agent, or
(iv) release any of the Guarantors from their obligations
under the Guaranty, without the written consent of all of the
Lenders, or
(v) release all or substantially all of the Collateral,
without the written consent of all of the Lenders, or
(vi) without the consent of Lenders holding in the aggregate
more than 66 2/3% of the Commitments then outstanding (or, if the
Commitments shall have been terminated at such time, holding 66
2/3% of the principal balance of the Obligations then outstanding),
extend the time for or the amount or the manner of application of
proceeds of any mandatory prepayment required by Section
2.7(b)(ii), (iii) or (iv) hereof, or
(vii) amend, modify or waive any provision of the Credit
Documents requiring consent, approval or request of the Required
Lenders or all Lenders, without the written consent of all of the
Lenders and, provided, further, that no amendment, waiver or
consent affecting the rights or duties of the Administrative Agent
or the Issuing Lender under any Credit Document shall in any event
be effective, unless in writing and signed by the Administrative
Agent and/or the Issuing Lender, as applicable, in addition to the
Lenders required hereinabove to take such action.
Any such waiver, any such amendment, supplement or modification and any
such release shall apply equally to each of the Lenders and shall be binding
upon the Borrower, the other Credit Parties, the Lenders, the Administrative
Agent and all future holders of the Notes. In the case of any waiver, the
Borrower, the other Credit Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
outstanding Loans and Notes and other Credit Documents, and any Default or
Event of Default waived shall be deemed to be cured and not continuing; but no
such waiver shall extend to any subsequent or other Default or Event of
Default, or impair any right consequent thereon.
Notwithstanding any of the foregoing to the contrary, the consent of the
Borrower shall not be required for any amendment, modification or waiver of the
provisions of Article VIII (except to the extent any of such provisions relate
to the rights of the Borrower or impose any additional liabilities or
obligations on the Borrower); provided, however, that the Administrative Agent
will provide written notice to the Borrower of any such amendment, modification
or waiver. In addition, the Borrower and the Lenders hereby authorize the
Administrative Agent to modify this Agreement by unilaterally
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amending or supplementing Schedule 2.1(a) from time to time in the manner
requested by the Borrower, the Administrative Agent or any Lender in order to
reflect any assignments or transfers of the Loans as provided for hereunder;
provided, however, that the Administrative Agent shall promptly deliver a copy
of any such modification to the Borrower and each Lender.
Notwithstanding the fact that the consent of all the Lenders is required
in certain circumstances as set forth above, (x) each Lender is entitled to
vote as such Lender sees fit on any bankruptcy reorganization plan that affects
the Loans, and each Lender acknowledges that the provisions of Section 1126(c)
of the Bankruptcy Code supersedes the unanimous consent provisions set forth
herein and (y) the Required Lenders may consent to allow a Credit Party to use
cash collateral in the context of a bankruptcy or insolvency proceeding.
Section 9.2 Notices.
Except as otherwise provided in Article II, all notices, requests and
demands to or upon the respective parties hereto to be effective shall be in
writing (including by telecopy), and, unless otherwise expressly provided
herein, shall be deemed to have been duly given or made (a) when delivered by
hand, (b) when transmitted via telecopy (or other facsimile device) to the
number set out herein, (c) the day following the day on which the same has been
delivered prepaid to a reputable national overnight air courier service, or (d)
the fifth Business Day following the day on which the same is sent by certified
or registered mail, postage prepaid, in each case, addressed as follows in the
case of the Borrower, the other Credit Parties and the Administrative Agent,
and as set forth on Schedule 9.2 in the case of the Lenders, or to such other
address as may be hereafter notified by the respective parties hereto and any
future holders of the Notes:
The Borrower Xxx River Inc.
and the other 0000 Xxxxxxxx Xxxxx
Credit Parties: Xxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
Xxx River Inc.
0000 Xxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
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The Administrative First Union National Bank
Agent: Xxx Xxxxx Xxxxx Xxxxxx, XX00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Syndication Agency Services
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
with a copy to:
First Union National Bank
Xxx Xxxxx Xxxxx Xxxxxx, XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxx
Senior Vice President
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
Section 9.3 No Waiver; Cumulative Remedies.
No failure to exercise and no delay in exercising, on the part of the
Administrative Agent or any Lender, any right, remedy, power or privilege
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power
or privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exclusive of any rights, remedies, powers and privileges
provided by law.
Section 9.4 Survival of Representations and Warranties.
All representations and warranties made hereunder and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the Notes and
the making of the Loans, provided that all such representations and warranties
shall terminate on the date upon which the Commitments have been terminated and
all amounts owing hereunder and under any Notes have been paid in full.
Section 9.5 Payment of Expenses and Taxes.
The Borrower agrees (a) to pay or reimburse the Administrative Agent for
all its reasonable out-of-pocket costs and expenses incurred in connection with
the development, preparation, negotiation, printing and execution of, and any
amendment, supplement or modification to, this Agreement and the other Credit
Documents and any other documents prepared in connection herewith or therewith,
and the consummation and administration of the transactions contemplated hereby
and thereby, together with the reasonable fees and disbursements of counsel to
the Administrative Agent, (b) to pay or reimburse each Lender and the
Administrative Agent for all its costs and
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expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the Notes, the other Credit Documents and any such
other documents, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent and to the Lenders
(including reasonable allocated costs of in-house legal counsel), and (c) on
demand, to pay, indemnify, and hold each Lender and the Administrative Agent
harmless from, any and all recording and filing fees and any and all
liabilities with respect to, or resulting from any delay in paying, stamp,
excise and other similar taxes, if any, which may be payable or determined to
be payable in connection with the execution and delivery of, or consummation or
administration of any of the transactions contemplated by, or any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
the Credit Documents and any such other documents, and (d) to pay, indemnify,
and hold each Lender and the Administrative Agent and their Affiliates harmless
from and against, any and all other liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever with respect to the execution, delivery, enforcement,
performance and administration of the Credit Documents and any such other
documents and the use, or proposed use, of proceeds of the Loans (all of the
foregoing, collectively, the "indemnified liabilities"); provided, however,
that the Borrower shall not have any obligation hereunder to the Administrative
Agent or any Lender with respect to indemnified liabilities arising from the
gross negligence or willful misconduct of the Administrative Agent or any such
Lender, as determined by a court of competent jurisdiction. The agreements in
this Section 9.5 shall survive repayment of the Loans, Notes and all other
amounts payable hereunder.
Section 9.6 Successors and Assigns; Participations; Purchasing Lenders.
(a) This Agreement shall be binding upon and inure to the benefit
of the Borrower, the Lenders, the Administrative Agent, all future
holders of the Notes and their respective successors and assigns, except
that the Borrower may not assign or transfer any of its rights or
obligations under this Agreement or the other Credit Documents without
the prior written consent of each Lender.
(b) Any Lender may, in the ordinary course of its commercial
banking business and in accordance with applicable law, at any time sell
to one or more banks or other entities ("Participants") participating
interests in any Loan owing to such Lender, any Note held by such Lender,
any Commitment of such Lender, or any other interest of such Lender
hereunder. In the event of any such sale by a Lender of participating
interests to a Participant, such Lender's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged,
such Lender shall remain solely responsible for the performance thereof,
such Lender shall remain the holder of any such Note for all purposes
under this Agreement, and the Borrower and the Administrative Agent shall
continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement. No Lender
shall transfer or grant any
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participation under which the Participant shall have rights to approve
any amendment to or waiver of this Agreement or any other Credit Document
except to the extent such amendment or waiver would (i) extend the
scheduled maturity of any Loan or Note or any installment thereon in
which such Participant is participating, or reduce the stated rate or
extend the time of payment of interest or fees thereon (except in
connection with a waiver of interest at the increased post-default rate)
or reduce the principal amount thereof, or increase the amount of the
Participant's participation over the amount thereof then in effect (it
being understood that a waiver of any Default or Event of Default shall
not constitute a change in the terms of such participation, and that an
increase in any Commitment or Loan shall be permitted without consent of
any participant if the Participant's participation is not increased as a
result thereof), (ii) release any of the Guarantors from their
obligations under the Guaranty, (iii) release all or substantially all of
the Collateral, or (iv) consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement. In
the case of any such participation, the Participant shall not have any
rights under this Agreement or any of the other Credit Documents (the
Participant's rights against such Lender in respect of such participation
to be those set forth in the agreement executed by such Lender in favor
of the Participant relating thereto) and all amounts payable by the
Borrower hereunder shall be determined as if such Lender had not sold
such participation, provided that each Participant shall be entitled to
the benefits of Sections 2.15, 2.16, 2.17, 2.18, 9.5 and 9.7 with respect
to its participation in the Commitments and the Loans outstanding from
time to time; provided, that no Participant shall be entitled to receive
any greater amount pursuant to such Sections than the transferor Lender
would have been entitled to receive in respect of the amount of the
participation transferred by such transferor Lender to such Participant
had no such transfer occurred.
(c) Any Lender may, in the ordinary course of its commercial
banking business and in accordance with applicable law, at any time, sell
or assign to any Lender or any affiliate thereof and with the consent of
the Administrative Agent and, so long as no Event of Default has occurred
and is continuing, the Borrower (in each case, which consent shall not be
unreasonably withheld), to one or more additional banks, financial
institutions or other entities ("Purchasing Lenders"), all or any part of
its rights and obligations under this Agreement and the Notes in minimum
amounts of $5,000,000 with respect to its Revolving Commitment, its
Revolving Loans and its Term Loans (or, if less, the entire amount of
such Lender's obligations), pursuant to a Commitment Transfer Supplement,
executed by such Purchasing Lender and such transferor Lender (and, in
the case of a Purchasing Lender that is not then a Lender or an affiliate
thereof, the Administrative Agent and, so long as no Event of Default has
occurred and is continuing, the Borrower), and delivered to the
Administrative Agent for its acceptance and recording in the Register;
provided, however, that any sale or assignment to an existing Lender
shall not require the consent of the Administrative Agent or the Borrower
nor shall any such sale or assignment be subject to the minimum
assignment amounts specified herein. Upon such execution, delivery,
acceptance and recording, from
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and after the Transfer Effective Date specified in such Commitment
Transfer Supplement, (x) the Purchasing Lender thereunder shall be a
party hereto and, to the extent provided in such Commitment Transfer
Supplement, have the rights and obligations of a Lender hereunder with a
Commitment as set forth therein, and (y) the transferor Lender thereunder
shall, to the extent provided in such Commitment Transfer Supplement, be
released from its obligations under this Agreement (and, in the case of a
Commitment Transfer Supplement covering all or the remaining portion of a
transferor Lender's rights and obligations under this Agreement, such
transferor Lender shall cease to be a party hereto). Such Commitment
Transfer Supplement shall be deemed to amend this Agreement to the
extent, and only to the extent, necessary to reflect the addition of such
Purchasing Lender and the resulting adjustment of Commitment Percentages
arising from the purchase by such Purchasing Lender of all or a portion
of the rights and obligations of such transferor Lender under this
Agreement and the Notes. On or prior to the Transfer Effective Date
specified in such Commitment Transfer Supplement, the Borrower, at its
own expense, shall execute and deliver to the Administrative Agent in
exchange for the Notes delivered to the Administrative Agent pursuant to
such Commitment Transfer Supplement new Notes to the order of such
Purchasing Lender in an amount equal to the Commitment assumed by it
pursuant to such Commitment Transfer Supplement and, unless the
transferor Lender has not retained a Commitment hereunder, new Notes to
the order of the transferor Lender in an amount equal to the Commitment
retained by it hereunder. Such new Notes shall be dated the Closing Date
and shall otherwise be in the form of the Notes replaced thereby. The
Notes surrendered by the transferor Lender shall be returned by the
Administrative Agent to the Borrower marked "canceled".
(d) The Administrative Agent shall maintain at its address
referred to in Section 9.2 a copy of each Commitment Transfer Supplement
delivered to it and a register (the "Register") for the recordation of
the names and addresses of the Lenders and the Commitment of, and
principal amount of the Loans owing to, each Lender from time to time.
The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Administrative Agent and the
Lenders may treat each Person whose name is recorded in the Register as
the owner of the Loan recorded therein for all purposes of this
Agreement. The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of a duly executed Commitment Transfer
Supplement, together with payment to the Administrative Agent by the
transferor Lender or the Purchasing Lender, as agreed between them, of a
registration and processing fee of $3,500 for each Purchasing Lender
listed in such Commitment Transfer Supplement and the Notes subject to
such Commitment Transfer Supplement, the Administrative Agent shall (i)
accept such Commitment Transfer Supplement, (ii) record the information
contained therein in the Register and (iii) give prompt notice of such
acceptance and recordation to the Lenders and the Borrower.
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(f) The Borrower authorizes each Lender to disclose to any
Participant or Purchasing Lender (each, a "Transferee") and any
prospective Transferee any and all financial information in such Lender's
possession concerning the Borrower and its Affiliates which has been
delivered to such Lender by or on behalf of the Borrower pursuant to this
Agreement or which has been delivered to such Lender by or on behalf of
the Borrower in connection with such Lender's credit evaluation of the
Borrower and its Affiliates prior to becoming a party to this Agreement,
in each case subject to Section 9.16.
(g) At the time of each assignment pursuant to this Section 9.6
to a Person which is not already a Lender hereunder and which is not a
United States person (as such term is defined in Section 7701(a)(30) of
the Code) for Federal income tax purposes, the respective assignee Lender
shall provide to the Borrower and the Administrative Agent the
appropriate Internal Revenue Service Forms (and, if applicable, a 2.18
Certificate) described in Section 2.18.
(h) Nothing herein shall prohibit any Lender from pledging or
assigning any of its rights under this Agreement (including, without
limitation, any right to payment of principal and interest under any
Note) to any Federal Reserve Bank in accordance with applicable laws.
Section 9.7 Adjustments; Set-off.
(a) Each Lender agrees that if any Lender (a "benefited Lender")
shall at any time receive any payment of all or part of its Loans, or
interest thereon, or receive any collateral in respect thereof (whether
voluntarily or involuntarily, by set-off, pursuant to events or
proceedings of the nature referred to in Section 7.1(e), 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, or
interest thereon, such benefited Lender shall purchase for cash from the
other Lenders a participating interest in such portion of each such other
Lender's Loan, or shall provide such other Lenders with the benefits of
any such collateral, or the proceeds thereof, as shall be necessary to
cause such benefited 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 benefited Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of
such recovery, but without interest. The Borrower agrees that each
Lender so purchasing a portion of another Lender's Loans may exercise all
rights of payment (including, without limitation, rights of set-off) with
respect to such portion as fully as if such Lender were the direct holder
of such portion.
(b) In addition to any rights and remedies of the Lenders
provided by law (including, without limitation, other rights of set-off),
each Lender shall have the right, without prior notice to the Borrower,
any such notice being expressly waived by the Borrower to the extent
permitted by applicable law, upon the occurrence of any Event of
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Default, to setoff and appropriate and apply any and all deposits
(general or special, time or demand, provisional or final), in any
currency, and any other credits, indebtedness or claims, in any currency,
in each case whether direct or indirect, absolute or contingent, matured
or unmatured, at any time held or owing by such Lender or any Affiliate,
branch or agency thereof to or for the credit or the account of the
Borrower, or any part thereof in such amounts as such Lender may elect,
against and on account of the obligations and liabilities of the Borrower
to such Lender hereunder and claims of every nature and description of
such Lender against the Borrower, in any currency, whether arising
hereunder, under the Notes or under any documents contemplated by or
referred to herein or therein, as such Lender may elect, whether or not
such Lender has made any demand for payment and although such
obligations, liabilities and claims may be contingent or unmatured. The
aforesaid right of set-off may be exercised by such Lender against the
Borrower or against any trustee in bankruptcy, debtor in possession,
assignee for the benefit of creditors, receiver or execution, judgment or
attachment creditor of the Borrower, or against anyone else claiming
through or against the Borrower or any such trustee in bankruptcy, debtor
in possession, assignee for the benefit of creditors, receiver, or
execution, judgment or attachment creditor, notwithstanding the fact that
such right of set-off shall not have been exercised by such Lender prior
to the occurrence of any Event of Default. Each Lender agrees promptly
to notify the Borrower and the Administrative Agent 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.
Section 9.8 Table of Contents and Section Headings.
The table of contents and the Section and subsection headings herein are
intended for convenience only and shall be ignored in construing this
Agreement.
Section 9.9 Counterparts.
This Agreement may be executed by one or more of the parties to this
Agreement on any number of separate counterparts, and all of said counterparts
taken together shall be deemed to constitute one and the same instrument. A
set of the copies of this Agreement signed by all the parties shall be lodged
with the Borrower and the Administrative Agent.
Section 9.10 Effectiveness.
This Agreement shall become effective on the date on which all of the
parties have signed a copy hereof (whether the same or different copies) and
shall have delivered the same to the Administrative Agent pursuant to Section
9.2 or, in the case of the Lenders, shall have given to the Administrative
Agent written, telecopied or telex notice (actually received) at such office
that the same has been signed and mailed to it.
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Section 9.11 Severability.
Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent
of such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
Section 9.12 Integration.
This Agreement and the Notes represent the agreement of the Borrower, the
Administrative Agent and the Lenders with respect to the subject matter hereof,
and there are no promises, undertakings, representations or warranties by the
Administrative Agent, the Borrower or any Lender relative to the subject matter
hereof not expressly set forth or referred to herein or in the Notes.
Section 9.13 Governing Law.
This Agreement and the Notes and the rights and obligations of the
parties under this Agreement and the Notes shall be governed by, and construed
and interpreted in accordance with, the law of the State of North Carolina.
Section 9.14 Consent to Jurisdiction and Service of Process.
All judicial proceedings brought against the Borrower and/or any other
Credit Party with respect to this Agreement, any Note or any of the other
Credit Documents may be brought in any state or federal court of competent
jurisdiction in the State of North Carolina, and, by execution and delivery of
this Agreement, each of the Borrower and the other Credit Parties accepts, for
itself and in connection with its properties, generally and unconditionally,
the non-exclusive jurisdiction of the aforesaid courts and irrevocably agrees
to be bound by any final judgment rendered thereby in connection with this
Agreement from which no appeal has been taken or is available. Each of the
Borrower and the other Credit Parties irrevocably agrees that all service of
process in any such proceedings in any such court may be effected by mailing a
copy thereof by registered or certified mail (or any substantially similar form
of mail), postage prepaid, to it at its address set forth in Section 9.2 or at
such other address of which the Administrative Agent shall have been notified
pursuant thereto, such service being hereby acknowledged by the each of the
Borrower and the other Credit Parties to be effective and binding service in
every respect. Each of the Borrower, the other Credit Parties, the
Administrative Agent and the Lenders irrevocably waives any objection,
including, without limitation, any objection to the laying of venue or based on
the grounds of forum non conveniens which it may now or hereafter have to the
bringing of any such action or proceeding in any such jurisdiction. Nothing
herein shall affect the right to serve process in any other manner permitted by
law or shall limit the right of any Lender to bring proceedings against the
Borrower or the other Credit Parties in the court of any other jurisdiction.
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Section 9.15 Arbitration.
(a) Notwithstanding the provisions of Section 9.14 to the
contrary, upon demand of any party hereto, whether made before or within
three (3) months after institution of any judicial proceeding, any
dispute, claim or controversy arising out of, connected with or relating
to this Agreement and other Credit Documents ("Disputes") between or
among parties to this Agreement shall be resolved by binding arbitration
as provided herein. Institution of a judicial proceeding by a party does
not waive the right of that party to demand arbitration hereunder.
Disputes may include, without limitation, tort claims, counterclaims,
disputes as to whether a matter is subject to arbitration, claims brought
as class actions, claims arising from Credit Documents executed in the
future, or claims arising out of or connected with the transaction
reflected by this Agreement.
Arbitration shall be conducted under and governed by the Commercial
Arbitration Rules (the "Arbitration Rules") of the American Arbitration
Association (the "AAA") and Title 9 of the U.S. Code. All arbitration
hearings shall be conducted in Charlotte, North Carolina. A hearing
shall begin within 90 days of demand for arbitration and all hearings
shall be concluded within 120 days of demand for arbitration. These time
limitations may not be extended unless a party shows cause for extension
and then no more than a total extension of 60 days. The expedited
procedures set forth in Rule 51 et seq. of the Arbitration Rules shall be
applicable to claims of less than $1,000,000. All applicable statutes of
limitation shall apply to any Dispute. A judgment upon the award may be
entered in any court having jurisdiction. Arbitrators shall be licensed
attorneys selected from the Commercial Financial Dispute Arbitration
Panel of the AAA. The parties hereto do not waive applicable Federal or
state substantive law except as provided herein. Notwithstanding the
foregoing, this arbitration provision does not apply to disputes under or
related to Hedging Agreements.
(b) Notwithstanding the preceding binding arbitration provisions,
the Administrative Agent, the Lenders, the Borrower and the other Credit
Parties agree to preserve, without diminution, certain remedies that the
Administrative Agent on behalf of the Lenders may employ or exercise
freely, independently or in connection with an arbitration proceeding or
after an arbitration action is brought. The Administrative Agent on
behalf of the Lenders shall have the right to proceed in any court of
proper jurisdiction or by self-help to exercise or prosecute the
following remedies, as applicable (i) all rights to foreclose against any
real or personal property or other security by exercising a power of sale
granted under Credit Documents or under applicable law or by judicial
foreclosure and sale, including a proceeding to confirm the sale; (ii)
all rights of self-help including peaceful occupation of real property
and collection of rents, set-off, and peaceful possession of personal
property; (iii) obtaining provisional or ancillary remedies including
injunctive relief, sequestration, garnishment, attachment, appointment of
receiver and filing an involuntary bankruptcy proceeding; and (iv) when
applicable, a judgment by confession of judgment. Preservation of these
remedies does not limit the power of an arbitrator to grant similar
remedies that may be requested by a party in a Dispute.
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(c) The parties hereto agree that they shall not have a remedy of
punitive or exemplary damages against the other in any Dispute and hereby
waive any right or claim to punitive or exemplary damages they have now
or which may arise in the future in connection with any Dispute whether
the Dispute is resolved by arbitration or judicially.
(d) By execution and delivery of this Agreement, each of the
parties hereto accepts, for itself and in connection with its properties,
generally and unconditionally, the non-exclusive jurisdiction relating to
any arbitration proceedings conducted under the Arbitration Rules in
Charlotte, North Carolina and irrevocably agrees to be bound by any final
judgment rendered thereby in connection with this Agreement from which no
appeal has been taken or is available.
Section 9.16 Confidentiality.
The Administrative Agent and each of the Lenders agrees that it will use
its best efforts not to disclose without the prior consent of the Borrower
(other than to its employees, affiliates, auditors or counsel or to another
Lender) any information with respect to the Borrower and its Subsidiaries which
is furnished pursuant to this Agreement, any other Credit Document or any
documents contemplated by or referred to herein or therein and which is
designated by the Borrower to the Lenders in writing as confidential or as to
which it is otherwise reasonably clear such information is not public, except
that any Lender may disclose any such information (a) as has become generally
available to the public other than by a breach of this Section 9.16, (b) as may
be required or appropriate in any report, statement or testimony submitted to
any municipal, state or federal regulatory body having or claiming to have
jurisdiction over such Lender or to the Federal Reserve Board or the Federal
Deposit Insurance Corporation or the OCC or the NAIC or similar organizations
(whether in the United States or elsewhere) or their successors, (c) as may be
required or appropriate in response to any summons or subpoena or any law,
order, regulation or ruling applicable to such Lender, (d) to any prospective
Participant or assignee in connection with any contemplated transfer pursuant
to Section 9.6, provided that such prospective transferee shall have been made
aware of this Section 9.16 and shall have agreed to be bound by its provisions
as if it were a party to this Agreement or (e) to Gold Sheets and other similar
bank trade publications; such information to consist of deal terms and other
information regarding the credit facilities evidenced by this Agreement
customarily found in such publications.
Section 9.17 Acknowledgments.
The Borrower and the other Credit Parties each hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution
and delivery of each Credit Document;
(b) neither the Administrative Agent nor any Lender has any
fiduciary relationship with or duty to the Borrower or any other Credit
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Party arising out of or in connection with this Agreement and the
relationship between Administrative Agent and Lenders, on one hand, and
the Borrower and the other Credit Parties, on the other hand, in
connection herewith is solely that of debtor and creditor; and
(c) no joint venture exists among the Lenders or among the
Borrower or the other Credit Parties and the Lenders.
Section 9.18 Waivers of Jury Trial.
THE BORROWER, THE OTHER CREDIT PARTIES, THE AGENT AND THE LENDERS HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
Section 9.19 Conflict.
To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of any Credit Document, on
the other hand, this Agreement shall control.
ARTICLE X
GUARANTY
Section 10.1 The Guaranty.
In order to induce the Lenders to enter into this Agreement and to extend
credit hereunder and in recognition of the direct benefits to be received by
the Guarantors from the Extensions of Credit hereunder, each of the Guarantors
hereby agrees with the Administrative Agent and the Lenders as follows: the
Guarantor hereby unconditionally and irrevocably jointly and severally
guarantees as primary obligor and not merely as surety the full and prompt
payment when due, whether upon maturity, by acceleration or otherwise, of any
and all indebtedness of the Borrower to the Administrative Agent and the
Lenders including, without limitation, the Credit Party Obligations. If any or
all of the indebtedness of the Borrower to the Administrative Agent and the
Lenders becomes due and payable hereunder, each Guarantor unconditionally
promises to pay such indebtedness to the Administrative Agent and the Lenders,
or order, on demand, together with any and all reasonable expenses which may be
incurred by the Administrative Agent or the Lenders in collecting any of the
indebtedness. The word "indebtedness" is used in this Article X in its most
comprehensive sense and includes any and all advances, debts, obligations and
liabilities of the Borrower arising in connection with this Agreement and the
other Credit Documents in each case, heretofore, now, or hereafter made,
incurred or created, whether voluntarily or involuntarily, absolute or
contingent, liquidated or unliquidated, determined or undetermined, whether or
not such indebtedness is from time to time reduced, or extinguished and
thereafter increased or incurred, whether the Borrower
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may be liable individually or jointly with others, whether or not recovery upon
such indebtedness may be or hereafter become barred by any statute of
limitations, and whether or not such indebtedness may be or hereafter become
otherwise unenforceable.
Notwithstanding any provision to the contrary contained herein or in any
other of the Credit Documents, to the extent the obligations of a Guarantor
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers) then the obligations of each such
Guarantor hereunder shall be limited to the maximum amount that is permissible
under applicable law (whether federal or state and including, without
limitation, the Bankruptcy Code).
Section 10.2 Bankruptcy.
Additionally, each of the Guarantors unconditionally and irrevocably
guarantees jointly and severally the payment of any and all indebtedness of the
Borrower to the Lenders whether or not due or payable by the Borrower upon the
occurrence of any of the events specified in Section 7.1(e), and
unconditionally promises to pay such indebtedness to the Administrative Agent
for the account of the Lenders, or order, on demand, in lawful money of the
United States. Each of the Guarantors further agrees that to the extent that
the Borrower or a Guarantor shall make a payment or a transfer of an interest
in any property to the Administrative Agent or any Lender, which payment or
transfer or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, or otherwise is avoided, and/or required to be
repaid to the Borrower or a Guarantor, the estate of the Borrower or a
Guarantor, a trustee, receiver or any other party under any bankruptcy law,
state or federal law, common law or equitable cause, then to the extent of such
avoidance or repayment, the obligation or part thereof intended to be satisfied
shall be revived and continued in full force and effect as if said payment had
not been made.
Section 10.3 Nature of Liability.
The liability of each Guarantor hereunder is exclusive and independent of
any security for or other guaranty of the indebtedness of the Borrower whether
executed by any such Guarantor, any other guarantor or by any other party, and
no Guarantor's liability hereunder shall be affected or impaired by (a) any
direction as to application of payment by the Borrower or by any other party,
or (b) any other continuing or other guaranty, undertaking or maximum liability
of a guarantor or of any other party as to the indebtedness of the Borrower, or
(c) any payment on or in reduction of any such other guaranty or undertaking,
or (d) any dissolution, termination or increase, decrease or change in
personnel by the Borrower, or (e) any payment made to the Administrative Agent
or the Lenders on the indebtedness which the Administrative Agent or such
Lenders repay the Borrower pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding, and
each of the Guarantors waives any right to the deferral or modification of its
obligations hereunder by reason of any such proceeding.
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Section 10.4 Independent Obligation.
The obligations of each Guarantor hereunder are independent of the
obligations of any other guarantor or the Borrower, and a separate action or
actions may be brought and prosecuted against each Guarantor whether or not
action is brought against any other guarantor or the Borrower and whether or
not any other Guarantor or the Borrower is joined in any such action or
actions.
Section 10.5 Authorization.
Each of the Guarantors authorizes the Administrative Agent and each
Lender without notice or demand (except as shall be required by applicable
statute and cannot be waived), and without affecting or impairing its liability
hereunder, from time to time to (a) renew, compromise, extend, increase,
accelerate or otherwise change the time for payment of, or otherwise change the
terms of the indebtedness or any part thereof in accordance with this
Agreement, including any increase or decrease of the rate of interest thereon,
(b) take and hold security from any guarantor or any other party for the
payment of this Guaranty or the indebtedness and exchange, enforce waive and
release any such security, (c) apply such security and direct the order or
manner of sale thereof as the Administrative Agent and the Lenders in their
discretion may determine and (d) release or substitute any one or more
endorsers, guarantors, the Borrower or other obligors.
Section 10.6 Reliance.
It is not necessary for the Administrative Agent or the Lenders to
inquire into the capacity or powers of the Borrower or the officers, directors,
partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.
Section 10.7 Waiver.
(a) Each of the Guarantors waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or any Lender to (i) proceed against the Borrower,
any other guarantor or any other party, (ii) proceed against or exhaust
any security held from the Borrower, any other guarantor or any other
party, or (iii) pursue any other remedy in the Administrative Agent's or
any Lender's power whatsoever. Each of the Guarantors waives any defense
based on or arising out of any defense of the Borrower, any other
guarantor or any other party other than payment in full of the
indebtedness, including without limitation any defense based on or
arising out of the disability of the Borrower, any other guarantor or any
other party, or the unenforceability of the indebtedness or any part
thereof from any cause, or the cessation from any cause of the liability
of the Borrower other than payment in full of the indebtedness. Without
limiting the generality of the provisions of this Article X, each of the
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Guarantors hereby specifically waives the benefits of N.C. Gen. Stat.
Section 26-7 through 26-9, inclusive. The Administrative Agent or any of
the Lenders may, at their election, foreclose on any security held by the
Administrative Agent or a Lender by one or more judicial or nonjudicial
sales, whether or not every aspect of any such sale is commercially
reasonable (to the extent such sale is permitted by applicable law), or
exercise any other right or remedy the Administrative Agent and any
Lender may have against the Borrower or any other party, or any security,
without affecting or impairing in any way the liability of any Guarantor
hereunder except to the extent the indebtedness has been paid. Each of
the Guarantors waives any defense arising out of any such election by the
Administrative Agent and each of the Lenders, even though such election
operates to impair or extinguish any right of reimbursement or
subrogation or other right or remedy of the Guarantors against the
Borrower or any other party or any security.
(b) Each of the Guarantors waives all presentments, demands for
performance, protests and notices, including without limitation notices
of nonperformance, notice of protest, notices of dishonor, notices of
acceptance of this Guaranty, and notices of the existence, creation or
incurring of new or additional indebtedness. Each Guarantor assumes all
responsibility for being and keeping itself informed of the Borrower's
financial condition and assets, and of all other circumstances bearing
upon the risk of nonpayment of the indebtedness and the nature, scope and
extent of the risks which such Guarantor assumes and incurs hereunder,
and agrees that neither the Administrative Agent nor any Lender shall
have any duty to advise such Guarantor of information known to it
regarding such circumstances or risks.
(c) Each of the Guarantors hereby agrees it will not exercise any
rights of subrogation which it may at any time otherwise have as a result
of this Guaranty (whether contractual, under Section 509 of the U.S.
Bankruptcy Code, or otherwise) to the claims of the Lenders against the
Borrower or any other guarantor of the indebtedness of the Borrower owing
to the Lenders (collectively, the "Other Parties") and all contractual,
statutory or common law rights of reimbursement, contribution or
indemnity from any Other Party which it may at any time otherwise have as
a result of this Guaranty until such time as the Loans hereunder shall
have been indefeasibly paid in full in cash and the Commitments have been
terminated. Each of the Guarantors hereby further agrees not to exercise
any right to enforce any other remedy which the Administrative Agent and
the Lenders now have or may hereafter have against any Other Party, any
endorser or any other guarantor of all or any part of the indebtedness of
the Borrower and any benefit of, and any right to participate in, any
security or collateral given to or for the benefit of the Lenders to
secure payment of the indebtedness of the Borrower until such time as the
Loans hereunder shall have been indefeasibly paid in full in cash and the
Commitments have been terminated.
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Section 10.8 Limitation on Enforcement.
The Lenders agree that this Guaranty may be enforced only by the action
of the Administrative Agent acting upon the instructions of the Required
Lenders and that no Lender shall have any right individually to seek to enforce
or to enforce this Guaranty, it being understood and agreed that such rights
and remedies may be exercised by the Administrative Agent for the benefit of
the Lenders upon the terms of this Agreement. The Lenders further agree that
this Guaranty may not be enforced against any director, officer, employee or
stockholder of the Guarantors.
Section 10.9 Confirmation of Payment.
The Administrative Agent and the Lenders will, upon request after payment
of the indebtedness and obligations which are the subject of this Guaranty and
termination of the commitments relating thereto, confirm to the Borrower, the
Guarantors or any other Person that the such indebtedness and obligations have
been paid and the commitments relating thereto terminated, subject to the
provisions of Section 10.2.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Charlotte, North Carolina by its proper and duly
authorized officers as of the day and year first above written.
BORROWER: XXX RIVER INC.,
a Georgia corporation
By:_______________________
Name:
Title:
GUARANTORS: THE XXXX COMPANY,
a Delaware corporation
By:_______________________
Name:
Title:
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XXX RIVER FACTORY STORES, INC.,
a Georgia corporation
By:_______________________
Name:
Title:
AGENTS AND LENDERS: FIRST UNION NATIONAL BANK,
as Administrative Agent and as a Lender
By:_______________________
Name:
Title:
THE FIRST NATIONAL BANK OF CHICAGO, as
Syndication Agent and as a Lender
By:_______________________
Name:
Title:
WACHOVIA BANK, N.A.,
as Documentation Agent and as a Lender
By:_______________________
Name:
Title:
LENDERS: SUNTRUST BANK, N.A.
By:_______________________
Name:
Title:
00
XXX XXXX XX XXXX XXXXXX
By:_______________________
Name:
Title:
COMERICA BANK
By:_______________________
Name:
Title:
COOPERATIEVE CENTRALE RAIFFEISEN
-BOERENLEENBANK B.A. "RABOBANK NEDERLAND",
NEW YORK BRANCH
By:_______________________
Name:
Title:
PNC BANK, N.A.
By:_______________________
Name:
Title:
CENTURA BANK
By:_______________________
Name:
Title:
99
CREDIT LYONNAIS ATLANTA AGENCY
By:_______________________
Name:
Title:
FLEET BANK, N.A.
By:_______________________
Name:
Title:
ABN AMRO BANK N.V.
By:_______________________
Name:
Title:
THE BANK OF NEW YORK
By:_______________________
Name:
Title:
NATIONAL BANK OF CANADA
By:_______________________
Name:
Title:
100
THE LONG-TERM CREDIT BANK OF JAPAN, LIMITED
By:_______________________
Name:
Title:
SOCIETE GENERALE
By:_______________________
Name:
Title:
SOUTHTRUST BANK, N.A.
By:_______________________
Name:
Title:
NATIONAL CITY BANK OF KENTUCKY
By:_______________________
Name:
Title:
