EXECUTION COPY
CREDIT AGREEMENT
Dated as of August 19, 2002
among
AGRILINK FOODS, INC.
as Borrower,
AGRILINK HOLDINGS INC.,
and
THE SUBSIDIARIES OF THE BORROWER
FROM TIME TO TIME PARTY HERETO,
as Guarantors,
THE LENDERS
FROM TIME TO TIME PARTY HERETO,
BANK OF AMERICA, N.A.,
as Syndication Agent,
XXXXXX TRUST AND SAVINGS BANK and U.S. BANK NATIONAL ASSOCIATION,
as Co-Documentation Agents
and
JPMORGAN CHASE BANK,
as Administrative Agent
JPMORGAN SECURITIES INC.,
as Sole Lead Arranger and Sole Bookrunner
Table of Contents
Page
SECTION I DEFINITIONS.............................................................................................1
1.1. DEFINITIONS......................................................................................1
1.2. COMPUTATION OF TIME PERIODS.....................................................................36
1.3. ACCOUNTING TERMS................................................................................36
SECTION II CREDIT FACILITIES.....................................................................................38
2.1. REVOLVING LOANS.................................................................................38
2.2. LETTER OF CREDIT SUBFACILITY....................................................................40
2.3. SWINGLINE LOAN SUBFACILITY......................................................................45
2.4. [INTENTIONALLY DELETED].........................................................................47
2.5. TRANCHE B TERM LOAN.............................................................................47
SECTION III OTHER PROVISIONS RELATING TO CREDIT FACILITIES.......................................................49
3.1. DEFAULT RATE....................................................................................49
3.2. EXTENSION AND CONVERSION........................................................................49
3.3. PREPAYMENTS.....................................................................................50
3.4. TERMINATION AND REDUCTION OF REVOLVING COMMITTED AMOUNT.........................................52
3.5. FEES............................................................................................53
3.6. CAPITAL ADEQUACY................................................................................54
3.7. LIMITATION ON EURODOLLAR LOANS..................................................................55
3.8. ILLEGALITY......................................................................................55
3.9. REQUIREMENTS OF LAW.............................................................................55
3.10. TREATMENT OF AFFECTED LOANS.....................................................................57
3.11. TAXES...........................................................................................57
3.12. COMPENSATION....................................................................................59
3.13. PRO RATA TREATMENT..............................................................................60
3.14. SHARING OF PAYMENTS.............................................................................61
3.15. PAYMENTS, COMPUTATIONS, ETC.....................................................................62
3.16. EVIDENCE OF DEBT................................................................................63
3.17. REPLACEMENT OF AFFECTED LENDERS.................................................................64
SECTION IV GUARANTY..............................................................................................65
4.1. THE GUARANTY....................................................................................65
4.2. OBLIGATIONS UNCONDITIONAL.......................................................................65
4.3. REINSTATEMENT...................................................................................66
4.4. CERTAIN ADDITIONAL WAIVERS......................................................................67
4.5. REMEDIES........................................................................................67
4.6. RIGHTS OF CONTRIBUTION..........................................................................67
4.7. GUARANTEE OF PAYMENT; CONTINUING GUARANTEE......................................................68
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SECTION V CONDITIONS.............................................................................................68
5.1. CLOSING CONDITIONS..............................................................................68
5.2. CONDITIONS TO ALL EXTENSIONS OF CREDIT..........................................................73
SECTION VI REPRESENTATIONS AND WARRANTIES........................................................................73
6.1. FINANCIAL CONDITION.............................................................................74
6.2. NO MATERIAL CHANGE..............................................................................75
6.3. ORGANIZATION AND GOOD STANDING..................................................................75
6.4. POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS...................................................75
6.5. NO CONFLICTS....................................................................................76
6.6. NO DEFAULT......................................................................................76
6.7. OWNERSHIP.......................................................................................76
6.8. INDEBTEDNESS....................................................................................76
6.9. LITIGATION......................................................................................76
6.10. TAXES...........................................................................................77
6.11. COMPLIANCE WITH LAW.............................................................................77
6.12. ERISA...........................................................................................77
6.13. CORPORATE STRUCTURE; CAPITAL STOCK, ETC.........................................................78
6.14. GOVERNMENTAL REGULATIONS, ETC...................................................................79
6.15. PURPOSE OF LOANS AND LETTERS OF CREDIT..........................................................79
6.16. ENVIRONMENTAL MATTERS...........................................................................79
6.17. INTELLECTUAL PROPERTY...........................................................................80
6.18. SOLVENCY........................................................................................81
6.19. INVESTMENTS.....................................................................................81
6.20. BUSINESS LOCATIONS..............................................................................81
6.21. DISCLOSURE......................................................................................81
6.22. BROKERS' FEES...................................................................................81
6.23. LABOR MATTERS...................................................................................81
6.24. NATURE OF BUSINESS..............................................................................81
6.25. SENIORITY.......................................................................................82
SECTION VII AFFIRMATIVE COVENANTS................................................................................82
7.1. INFORMATION COVENANTS...........................................................................82
7.2. PRESERVATION OF EXISTENCE AND FRANCHISES........................................................85
7.3. BOOKS AND RECORDS...............................................................................85
7.4. COMPLIANCE WITH LAW.............................................................................85
7.5. PAYMENT OF TAXES AND OTHER CLAIMS...............................................................86
7.6. INSURANCE.......................................................................................86
7.7. MAINTENANCE OF PROPERTY.........................................................................87
7.8. USE OF PROCEEDS.................................................................................87
7.9. AUDITS/INSPECTIONS..............................................................................87
7.10. FINANCIAL COVENANTS.............................................................................88
7.11. ADDITIONAL GUARANTORS...........................................................................89
7.12. PLEDGED ASSETS..................................................................................90
7.13. INTEREST RATE PROTECTION........................................................................91
7.14. FURTHER ASSURANCES..............................................................................91
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SECTION VIII NEGATIVE COVENANTS..................................................................................91
8.1. INDEBTEDNESS....................................................................................91
8.2. LIENS...........................................................................................93
8.3. NATURE OF BUSINESS..............................................................................96
8.4. CONSOLIDATION, MERGER, DISSOLUTION, ETC.........................................................96
8.5. ASSET DISPOSITIONS..............................................................................97
8.6. INVESTMENTS.....................................................................................98
8.7. RESTRICTED PAYMENTS............................................................................101
8.8. OTHER INDEBTEDNESS.............................................................................102
8.9. TRANSACTIONS WITH AFFILIATES...................................................................102
8.10. FISCAL YEAR; ORGANIZATIONAL DOCUMENTS AND OTHERS...............................................103
8.11. LIMITATION ON RESTRICTED ACTIONS...............................................................103
8.12. OWNERSHIP OF SUBSIDIARIES......................................................................104
8.13. SALE LEASEBACKS................................................................................104
8.14. NO FURTHER NEGATIVE PLEDGES....................................................................104
8.15. CAPITAL EXPENDITURES...........................................................................105
8.16. HOLDING COMPANY STATUS OF PARENT...............................................................105
SECTION IX EVENTS OF DEFAULT....................................................................................105
9.1. EVENTS OF DEFAULT..............................................................................105
9.2. ACCELERATION; REMEDIES.........................................................................108
SECTION X AGENCY PROVISIONS.....................................................................................108
10.1. APPOINTMENT, POWERS AND IMMUNITIES.............................................................108
10.2. RELIANCE BY ADMINISTRATIVE AGENT...............................................................109
10.3. DEFAULTS.......................................................................................110
10.4. RIGHTS AS A LENDER.............................................................................110
10.5. INDEMNIFICATION................................................................................110
10.6. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.........................................111
10.7. SUCCESSOR ADMINISTRATIVE AGENT.................................................................111
10.8. SYNDICATION AGENT..............................................................................112
10.9. CO-DOCUMENTATION AGENTS........................................................................112
SECTION XI MISCELLANEOUS........................................................................................112
11.1. NOTICES........................................................................................112
11.2. RIGHT OF SET-OFF; ADJUSTMENTS..................................................................114
11.3. BENEFIT OF AGREEMENT...........................................................................114
11.4. NO WAIVER; REMEDIES CUMULATIVE.................................................................118
11.5. EXPENSES; INDEMNIFICATION......................................................................118
11.6. AMENDMENTS, WAIVERS AND CONSENTS...............................................................119
11.7. COUNTERPARTS...................................................................................121
11.8. HEADINGS.......................................................................................122
11.9. SURVIVAL.......................................................................................122
11.10. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE...............................................122
11.11. SEVERABILITY...................................................................................123
11.12. ENTIRETY.......................................................................................123
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11.13. BINDING EFFECT; TERMINATION...................................................................123
11.14. CONFIDENTIALITY...............................................................................123
11.15. SOURCE OF FUNDS...............................................................................124
11.16. REGULATION D..................................................................................124
11.17. CONFLICT......................................................................................125
SCHEDULES
Schedule 1.1A Scheduled Financial Information
Schedule 1.1B Existing Letters of Credit
Schedule 2.1(a) Lenders
Schedule 6.1 Undisclosed Liabilities
Schedule 6.4 Required Consents, Authorizations, Notices and Filings
Schedule 6.9 Litigation
Schedule 6.12 ERISA
Schedule 6.13A Corporate Structure
Schedule 6.13B Subsidiaries
Schedule 6.16 Environmental Disclosures
Schedule 6.17 Intellectual Property
Schedule 6.20(a) Mortgaged Properties
Schedule 6.20(b) Collateral Locations
Schedule 6.20(c) Chief Executive Offices/Jurisdiction of
Incorporation/Principal Places of Business
Schedule 6.22 Broker's Fees
Schedule 6.23 Labor Matters
Schedule 7.6 Insurance
Schedule 8.1 Indebtedness
Schedule 8.2 Liens
Schedule 8.6 Investments
Schedule 8.9 Affiliate Transactions
EXHIBITS
Exhibit 1.1 Form of Collateral Agreement
Exhibit 2.1(b)(i) Form of Notice of Borrowing
Exhibit 2.1(e) Form of Revolving Note
Exhibit 2.3(d) Form of Swingline Note
Exhibit 2.5(f) Form of Tranche B Term Note
Exhibit 3.2 Form of Notice of Extension/Conversion
Exhibit 7.1(c) Form of Officer's Compliance Certificate
Exhibit 7.11 Form of Joinder Agreement
Exhibit 11.3(b) Form of Assignment and Acceptance
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT, dated as of August 19, 2002 (as amended,
modified, restated or supplemented from time to time, the "CREDIT AGREEMENT"),
is by and among AGRILINK FOODS, INC., a Delaware corporation (the "BORROWER"),
AGRILINK HOLDINGS INC., a Delaware corporation (the "PARENT"), the Subsidiary
Guarantors (as defined herein), the Lenders (as defined herein), and Bank of
America, N.A., as Syndication Agent for the Lenders (in such capacity, the
"SYNDICATION AGENT") XXXXXX TRUST AND SAVINGS BANK and U.S. BANK NATIONAL
ASSOCIATION, as Co-Documentation Agents for the Lenders (in such capacity, the
"CO-DOCUMENTATION AGENTS"), and JPMORGAN CHASE BANK, as Administrative Agent for
the Lenders (in such capacity, the "ADMINISTRATIVE AGENT").
W I T N E S S E T H
WHEREAS, the Borrower has requested that the Lenders provide credit
facilities in an aggregate principal amount of $470,000,000 (the "CREDIT
FACILITIES") for the purposes hereinafter set forth; and
WHEREAS, the Lenders have agreed to make the requested Credit
Facilities available to the Borrower on the terms and conditions hereinafter set
forth.
NOW, THEREFORE, IN CONSIDERATION of the premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
SECTION I
DEFINITIONS
1.1. DEFINITIONS.
As used in this Credit Agreement, the following terms shall have the
meanings specified below unless the context otherwise requires:
"ACQUIRED COMPANY" means Agrilink Foods, Inc., a Delaware corporation.
"ACQUIRED NON-CORE ASSET DISPOSITION" means an Asset Disposition of
Property acquired after the Closing Date in a Permitted Acquisition, provided
that (i) such Asset Disposition is consummated within 540 days following the
date of the related Permitted Acquisition and (ii) the aggregate fair market
value of the Property subject to such Asset Disposition (or series of related
Asset Dispositions) is less than $5,000,000; provided, however, that the term
"Acquired Non-Core Asset Disposition" shall not include any Asset Disposition
which is an "Asset Sale" (or any comparable term) under, and as defined in,
any Junior Financing Documentation.
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"ACQUISITION", by any Person, means the acquisition by such Person of
at least a majority of the Capital Stock or all or substantially all of the
Property or a line of business or division of another Person, whether or not
such acquisition involves a merger or consolidation by the acquiring Person
with or into the acquired Person.
"ADJUSTED BASE RATE" means, with respect to Revolving Loans, Tranche B
Term Loans and Swingline Loans which are Base Rate Loans, the Base Rate plus
the Applicable Percentage.
"ADJUSTED EURODOLLAR RATE" means, with respect to Revolving Loans and
Tranche B Term Loans which are Eurodollar Loans, the Eurodollar Rate plus the
Applicable Percentage.
"ADMINISTRATIVE AGENT" shall have the meaning assigned to such term in
the heading hereof, together with any successors or assigns.
"ADMINISTRATIVE AGENT'S FEE LETTER" means that certain fee letter
agreement, dated as of June 17, 2002, among JPMorgan Chase Bank, X.X. Xxxxxx
Securities Inc. and Vestar/Agrilink Holdings LLC, as amended, modified,
restated or supplemented from time to time.
"AFFILIATE" means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person or (ii) directly or indirectly
owning or holding ten percent (10%) or more of the Capital Stock in such
Person. For purposes of this definition, "control" when used with respect to
any Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"AGENCY MANAGEMENT ADDRESS" means JPMorgan Chase Bank, Agency
Management, Xxx Xxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn: Xxxxx Xxxx, or
such other address as may be identified by written notice from the
Administrative Agent to the Borrower.
"APPLICABLE LENDING OFFICE" means, for each Lender, the office of such
Lender (or of an Affiliate of such Lender) as such Lender may from time to
time specify to the Administrative Agent and the Borrower by written notice
as the office by which its Eurodollar Loans are made and maintained.
"APPLICABLE PERCENTAGE" means, for purposes of calculating the
applicable interest rate for any day for any Revolving Loan, Swingline Loan
or Tranche B Term Loan, the applicable rate of the Unused Fee for any day for
purposes of Section 3.5(a) or the applicable rate of the Standby Letter of
Credit Fee for any day for purposes of Section 3.5(b)(i), the appropriate
applicable percentage corresponding to the Consolidated Leverage Ratio in
effect as of the most recent Calculation Date:
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APPLICABLE PERCENTAGES FOR
REVOLVING LOANS AND TRANCHE B TERM
SWINGLINE LOANS LOANS
----------------------------------- ----------------------
Standby
Pricing Consolidated Eurodollar Base Rate Letter of Unused Eurodollar Base Rate
Level Leverage Ratio Loans Loans Credit Fee Fee Loans Loans
------- ---------------- ---------- --------- ---------- ------ ---------- ---------
I >= 4.75 to 1.00 3.00% 2.00% 3.00% 0.50% 3.25% 2.25%
but
< 4.75 to 1.00
II >= 4.25 to 1.00 2.75% 1.75% 2.75% 0.50% 3.00% 2.00%
but
< 4.25 to 1.00
III >= 3.75 to 1.00 2.50% 1.50% 2.50% 0.50% 3.00% 2.00%
but
< 3.75 to 1.00
IV >= 3.25 to 1.00 2.25% 1.25% 2.25% 0.375% 2.75% 1.75%
V < 3.25 to 1.00 2.00% 1.00% 2.00% 0.375% 2.75% 1.75%
The Applicable Percentages shall be determined and adjusted quarterly
on the date (each a "CALCULATION DATE") five Business Days after the date by
which the Credit Parties are required to provide the officer's certificate in
accordance with the provisions of Section 7.1(c) for the most recently ended
fiscal quarter of the Consolidated Parties or, in the case of the fourth
fiscal quarter of any fiscal year, five Business Days after such earlier date
as the Credit Parties shall have delivered to the Administrative Agent
financial statements for such fiscal quarter meeting the requirements of
Section 7.1(b) together with a related officer's certificate meeting the
requirements of Section 7.1(c), provided, however, that (i) the initial
Applicable Percentages shall be based on Pricing Level II and shall remain at
Pricing Level II until the Calculation Date for the fiscal quarter of the
Consolidated Parties ending on December 31, 2002, on and after which time the
Pricing Level shall be determined by the Consolidated Leverage Ratio as of
the last day of the most recently ended fiscal quarter of the Consolidated
Parties preceding the applicable Calculation Date and (ii) if the Credit
Parties fail to provide the officer's certificate to the Agency Management
Address as required by Section 7.1(c) for the last day of the most recently
ended fiscal quarter of the Consolidated Parties preceding the applicable
Calculation Date, the Applicable Percentage from such Calculation Date shall
be based on Pricing Level I until such time as an appropriate officer's
certificate is provided, whereupon the Pricing Level shall be determined by
the Consolidated Leverage Ratio as of the last day of the most recently ended
fiscal quarter of the Consolidated Parties preceding such Calculation Date.
Each Applicable Percentage shall be effective from one Calculation Date until
the next Calculation Date. Any adjustment in the Applicable Percentages shall
be applicable to all existing Loans and Letters of Credit as well as any new
Loans and Letters of Credit made or issued.
"APPLICATION PERIOD" means (i) in respect of the Net Cash Proceeds of
any Asset Disposition, the period of 365 days (or such earlier date as
provided for reinvestment of such proceeds under any Junior Financing
Documentation) following the
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consummation of such Asset Disposition and (ii) in respect of the Net Cash
Proceeds of any Equity Issuance (other than an Excluded Equity Issuance or a
Qualifying IPO), the period of 365 days (or such earlier date as provided for
reinvestment of such proceeds under any Junior Financing Documentation)
following the consummation of such Equity Issuance.
"APPROVED FUND" means (a) with respect to any Lender, a CLO managed or
administered by such Lender or by an Affiliate of such Lender and (b) with
respect to any Lender that is a fund which invests in bank loans and similar
extensions of credit, any other fund that invests in bank loans and similar
extensions of credit and is managed by the same investment advisor as such
Lender or by an Affiliate of such investment advisor.
"ASSET DISPOSITION" means any disposition (including pursuant to a Sale
and Leaseback Transaction) by a Consolidated Party of any or all of the
Property (including without limitation the Capital Stock of a Subsidiary) of
any Consolidated Party whether by sale, lease, licensing, transfer or
otherwise, other than pursuant to any Involuntary Disposition; provided,
however, that the term "Asset Disposition" (i) shall not be deemed to include
any Equity Issuance and (ii) shall be deemed to include any "Asset Sale" (or
any comparable term) under, and as defined in, any Junior Financing
Documentation.
"ASSET DISPOSITION PREPAYMENT EVENT" means, with respect to any Asset
Disposition other than an Excluded Asset Disposition, the failure of the
Credit Parties to apply (or cause to be applied) the Net Cash Proceeds of
such Asset Disposition to Eligible Reinvestments during the Application
Period for such Asset Disposition.
"ASSIGNMENT AND ACCEPTANCE" shall have the meaning assigned to such
term in Section 11.3(b).
"AVERAGE SENIOR DEBT" means, as of any date of determination, Average
Total Debt minus the aggregate principal amount of the sum of the
Subordinated Notes, including the Other Subordinated Notes and the GLK Note.
"AVERAGE TOTAL DEBT" means, as of any date of determination (i) the sum
of (a) the aggregate outstanding principal amount of all Funded Indebtedness
(other than the Revolving Loans and Indebtedness incurred pursuant to Section
8.1(r)) outstanding on such day and (b) the quotient of the sum of the
aggregate outstanding principal amount of all Revolving Loans outstanding on
the last day of each of the 12 fiscal months ending on or immediately prior
to such day divided by 12 minus (ii) the quotient of the sum of the aggregate
cash and cash equivalents (which are free of any Liens other than Liens in
favor of the Secured Parties and customary set-off rights or bankers' liens
of depositary institutions) outstanding on the last day of each of the 12
fiscal months ending on or immediately prior to such day divided by 12.
"BANKRUPTCY CODE" means the Bankruptcy Code in Title 11 of the United
States Code, as amended, modified, succeeded or replaced from time to time.
5
"BANKRUPTCY EVENT" means, with respect to any Person, the occurrence of
any of the following: (i) the entry of a decree or order for relief by a
court or governmental agency having jurisdiction over such Person in an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or the appointment by a court or governmental
agency of a receiver, liquidator, assignee, custodian, trustee, sequestrator
(or similar official) of such Person or for any substantial part of its
Property or the ordering of the winding up or liquidation of its affairs by a
court or governmental agency; or (ii) the commencement against such Person of
an involuntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or of any case, proceeding or other
action for the appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of such Person or for any
substantial part of its Property or for the winding up or liquidation of its
affairs, and such involuntary case or other case, proceeding or other action
shall remain undismissed for a period of sixty (60) consecutive days; or
(iii) such Person shall commence a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consent to the entry of an order for relief in an involuntary case under any
such law, or consent to the appointment of or the taking possession by a
receiver, liquidator, assignee, secured creditor, custodian, trustee,
sequestrator (or similar official) of such Person or for any substantial part
of its Property or make any general assignment for the benefit of creditors;
or (iv) such Person shall be unable to, or shall admit in writing its
inability to, pay its debts generally as they become due.
"BASE RATE" means, for any day, the rate per annum equal to the higher
of (a) the Federal Funds Rate for such day plus one-half of one percent
(0.5%) and (b) the Prime Rate for such day. Any change in the Base Rate due
to a change in the Prime Rate or the Federal Funds Rate shall be effective on
the effective date of such change in the Prime Rate or Federal Funds Rate.
"BASE RATE LOAN" means any Loan bearing interest at a rate determined
by reference to the Base Rate.
"BORROWER" means the Person identified as such in the heading hereof,
together with any permitted successors and assigns.
"BUSINESS DAY" means a day other than a Saturday, Sunday or other day
on which commercial banks in New York, New York are authorized or required by
law to close, EXCEPT THAT, when used in connection with a Eurodollar Loan,
such day shall also be a day on which dealings between banks are carried on
in Dollar deposits in London, England.
"BUSINESSES" means, at any time, a collective reference to the
businesses operated by the Consolidated Parties at such time.
"CALCULATION DATE" shall have the meaning assigned to such term in the
definition of "Applicable Percentage" set forth in this Section 1.1.
6
"CAPEX ROLLOVER" shall have the meaning assigned to such term in
Section 8.15.
"CAPITAL LEASE" means, as applied to any Person, any lease of any
Property (whether real, personal or mixed) by that Person as lessee which, in
accordance with GAAP, is required to be accounted for as a capital lease on
the balance sheet of that Person.
"CAPITAL STOCK" means (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) and (iv) in the case of a limited liability
company, membership interests.
"CASH EQUIVALENTS" means, as at any date, (1) with respect to any
Consolidated Party, (a) securities issued or directly and fully guaranteed or
insured by the United States or any agency or instrumentality thereof
(provided that the full faith and credit of the United States is pledged in
support thereof) having maturities of not more than twelve months from the
date of acquisition, (b) Dollar denominated time deposits and certificates of
deposit of (i) any Lender, (ii) any domestic commercial bank of recognized
standing having capital and surplus in excess of $500,000,000 or (iii) 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 thereof
(any such bank being an "APPROVED DOMESTIC BANK"), in each case with
maturities of not more than twelve (12) months from the date of acquisition,
(c) commercial paper and variable or fixed rate notes issued by any Approved
Domestic 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 twelve (12) months of the date of
acquisition, (d) repurchase agreements entered into by any Person with a bank
or trust company (including any of the Lenders) or 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 in which such
Person shall have a perfected first priority security interest (subject to no
other Liens) and having, on the date of purchase thereof, a fair market value
of at least 100% of the amount of the repurchase obligations and (e)
Investments, classified in accordance with GAAP as current assets, in money
market investment programs registered under the Investment Company Act of
1940, as amended, which are administered by reputable financial institutions
having capital of at least $500,000,000 and the portfolios of which are
limited such that 95% of such Investments are of the character described in
the foregoing subdivisions (a) through (d) and (2) solely with respect to any
Foreign Subsidiary, non-Dollar denominated (a) certificates of deposit of,
bankers acceptances of, or time deposits with, any commercial bank which is
organized and existing under the laws of the country in which such Foreign
Subsidiary maintains its chief executive office and principal place of
business provided such country is a member of the Organization for Economic
Cooperation and Development, and 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 thereof (any such bank being an
7
"APPROVED FOREIGN BANK") and maturing within twelve (12) months of the date
of acquisition and (b) equivalents of demand deposit accounts which are
maintained with an Approved Foreign Bank.
"CHANGE OF CONTROL" means any of the following events: (a) prior to a
Qualifying IPO, (1) the failure of the Parent to own directly all of the
Capital Stock of the Borrower (other than Qualified Preferred Stock issued by
the Borrower), (2) the failure of the Sponsor (A) to own beneficially,
directly or indirectly, at least 51% of the outstanding common Capital Stock
(on a fully diluted basis) of the Parent initially acquired, beneficially,
directly or indirectly, in the Transaction by the Sponsor and (B) to have the
right, directly or indirectly, by beneficial ownership, contract or
otherwise, to elect at least a majority in number of the members of the
Parent's Board of Directors or (3) less than a majority in number of the
sitting members of the Parent's Board of Directors shall have been elected by
the Sponsor, (b) after a Qualifying IPO, (1) if the IPO Issuer is not the
Borrower, the failure of the Parent to own directly all of the Capital Stock
of the Borrower, (2) the failure of the Sponsor to own beneficially, directly
or indirectly, an amount of Capital Stock with voting power of at least 20%
of the total voting power of all Capital Stock of the IPO Issuer, (3) a
person or any group, and any affiliate of any such person other than the
Sponsor shall beneficially own, directly or indirectly, an amount of Capital
Stock of the IPO Issuer with voting power greater than the voting power of
the amount of Capital Stock owned by the Sponsor or (4) during any period of
up to 24 consecutive months, commencing after the Closing Date, individuals
who at the beginning of such 24 month period were directors of the Parent
(or, after a Qualifying IPO, the IPO Issuer) (together with any new director
whose election by the Parent's (or the IPO Issuer's, as applicable) Board of
Directors or whose nomination for election by the Parent's (or the IPO
Issuer's, as applicable) shareholders was approved by the Sponsor or a vote
of at least a majority of the directors then still in office who either were
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 directors of the Parent (or the IPO Issuer, as applicable)
then in office or (c) if any Subordinated Debt or Qualified Preferred Stock
shall have been issued, the occurrence of a "Change of Control" (or any
comparable term) under, and as defined in, any Junior Financing
Documentation. As used herein, "beneficial ownership" shall have the meaning
provided in Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act.
"CLO" means any entity (whether a corporation, partnership, trust or
otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary
course of its business and is administered or managed by a Lender or an
Affiliate of such Lender.
"CLOSING DATE" means the date hereof.
"CODE" means the Internal Revenue Code of 1986, as amended, and any
successor statute thereto, as interpreted by the rules and regulations issued
thereunder, in each case as in effect from time to time. References to
sections of the Code shall be construed also to refer to any successor
sections.
8
"CO-DOCUMENTATION AGENTS" shall have the meaning assigned to such term
in the heading hereof, together with any successors or assigns.
"COLLATERAL" means a collective reference to all real and personal
Property (other than Excluded Property) with respect to which Liens in favor
of the Administrative Agent are purported to be granted pursuant to and in
accordance with the terms of the Collateral Documents.
"COLLATERAL AGREEMENT" means the Collateral Agreement dated as of the
Closing Date in the form of Exhibit 1.1 to be executed in favor of the
Administrative Agent by each of the Credit Parties, as amended, modified,
restated or supplemented from time to time.
"COLLATERAL DOCUMENTS" means a collective reference to the Collateral
Agreement, the Mortgage Instruments and any other agreement or instrument
executed by any Consolidated Party from time to time purporting to xxxxx x
Xxxx on any property described therein in order to secure payment of all or
any portion of the Credit Party Obligations.
"COMMITMENT" means (i) with respect to each Lender, the Revolving
Commitment of such Lender and the Tranche B Term Loan Commitment of such
Lender, (ii) with respect to the Issuing Lender, the LOC Commitment and (iii)
with respect to the Swingline Lender, the Swingline Commitment.
"CONSENT SOLICITATION" means the consent solicitation pursuant to the
Consent Solicitation Statement, dated as of July 9, 2002, in respect of all
outstanding 11 7/8% Senior Subordinated Notes due 2008 issued by the
Borrower.
"CONSOLIDATED CAPITAL EXPENDITURES" means, for the applicable period,
all capital expenditures of the Consolidated Parties on a consolidated basis
for such period, as determined in accordance with GAAP; provided, however,
that Consolidated Capital Expenditures shall not include any such
expenditures which constitute (a) a Permitted Acquisition, (b) capital
expenditures relating to the construction or acquisition of any Property
which has been transferred to a Person that is not a Consolidated Party
pursuant to a Sale and Leaseback Transaction permitted under Section 8.13 or
(c) to the extent permitted by this Credit Agreement, an Eligible
Reinvestment of the Net Cash Proceeds of any Asset Disposition (other than an
Asset Dispositions of the type described in clauses (i), (viii) and (ix) of
the definition of "Excluded Asset Disposition"), Involuntary Disposition or
Equity Issuance.
"CONSOLIDATED CASH INTEREST EXPENSE" means, as of any date for the
applicable period ending on such date with respect to the Consolidated
Parties on a consolidated basis, interest expense (including the interest
component under Capital Leases and the implied interest component under
Synthetic Leases, but excluding, to the extent included in interest expense,
(i) fees and expenses associated with the consummation of the Transaction,
(ii) annual agency fees described in the Administrative Agent's Fee Letter,
(iii) costs associated with obtaining Hedging Agreements, (iv) letter
9
of credit fees, (v) the Pro-Fac Payment and (vi) fees and expenses associated
with any Permitted Investment, Equity Issuance or Debt Issuance (whether or
not consummated)), as determined in accordance with GAAP, to the extent the
same are payable in cash with respect to such period; provided, however, that
Consolidated Cash Interest Expense for each of the fiscal quarters ending on
December 31, 2001, March 31, 2002 and June 30, 2002 shall be equal to the
amount indicated for Consolidated Cash Interest Expense for such quarter on
Schedule 1.1A.
"CONSOLIDATED CASH TAXES" means, as of any date for the applicable
period ending on such date with respect to the Consolidated Parties on a
consolidated basis, the aggregate of all income, franchise and similar taxes,
as determined in accordance with GAAP, to the extent the same are payable in
cash with respect to such period.
"CONSOLIDATED EBITDA" means, as of any date for the applicable period
ending on such date with respect to the Consolidated Parties on a
consolidated basis, the sum of (i) Consolidated Net Income, plus (ii) an
amount which, in the determination of Consolidated Net Income for such
period, has been deducted for, without duplication, (A) total interest
expense, (B) income, franchise and similar taxes and any tax distributions
permitted to be made pursuant to Section 8.7(c), (C) depreciation and
amortization expense, including any non-cash goodwill impairment charges, (D)
letter of credit fees, (E) non-cash expenses resulting from any employee
benefit or management compensation plan or the grant or ownership of equity
and equity options to employees of the Parent, the Borrower or any of their
respective Subsidiaries pursuant to a written plan or agreement or the
treatment of such equity or options under variable plan accounting, (F) all
extraordinary charges, (G) non-cash amortization of financing costs of the
Parent and its Subsidiaries, (H) one-time cash fees and expenses incurred in
connection with the Transaction or, to the extent permitted hereunder, any
Permitted Investment, Equity Issuance or Debt Issuance (whether or not
consummated), (I) any losses realized upon the disposition of Property
outside of the ordinary course of business, (J) to the extent actually
reimbursed, expenses incurred to the extent covered by indemnification
provisions in any agreement in connection with the Transaction and any
Permitted Acquisition (or in any similar agreement related to any other
Acquisition consummated prior to the Closing Date), (K) to the extent covered
by insurance, expenses with respect to liability or casualty events, business
interruption or product recalls, (L) management fees, (M) any non-cash
purchase accounting adjustment (and their related non-cash future effect) and
any step-ups or write-downs with respect to re-valuing assets and liabilities
in connection with the Transaction or any Permitted Investment, (N) other
non-cash expenses (excluding any non-cash expense to the extent that it
represents an accrual of or reserve for cash expenses in any future period),
(O) non-cash losses from Joint Ventures and non-cash minority interest
reductions, (P) fees and expenses in connection with the exchange or
refinancing of the Subordinated Notes or the GLK Note as permitted by Section
8.8, (Q) non-cash, non-recurring charges, (R) other non-recurring cash
charges during any four consecutive fiscal quarter period in an aggregate
amount not to exceed $2,000,000, (S) expenses representing the implied
principal component under Synthetic Leases, (T) the aggregate Inventory
Adjustment, (U) expenses, charges and losses associated with the Discontinued
Operations not to exceed $3,500,000 at any covenant
10
reporting period during the first two years following the Closing Date, (V)
the Pro-Fac Payment, and (W) for all periods prior to the Closing Date,
Pro-Fac's share of income as reflected on its financial statements minus
(iii) an amount which, in the determination of Consolidated Net Income, has
been included for (A) all extraordinary gains and non-cash income during such
period and (B) any gains realized upon the disposition of Property outside of
the ordinary course of business plus/minus (iv) unrealized losses/gains and
any xxxx-to-market adjustments in respect of Hedging Agreements.
"CONSOLIDATED LEVERAGE RATIO" means, as of the end of any fiscal
quarter of the Consolidated Parties for the four fiscal quarter period ending
on such date with respect to the Consolidated Parties on a consolidated
basis, the ratio of (a) Average Total Debt on the last day of such period to
(b) Consolidated EBITDA for such period.
"CONSOLIDATED NET INCOME" means, as of any date for the applicable
period ending on such date with respect to the Consolidated Parties on a
consolidated basis, net income (excluding, without duplication, (i)
extraordinary items and (ii) any amounts attributable to Investments in any
Joint Venture to the extent that such amounts have not been distributed in
cash to the Consolidated Parties during the applicable period, as determined
in accordance with GAAP).
"CONSOLIDATED PARTIES" means a collective reference to the Parent and
its Subsidiaries, and "CONSOLIDATED PARTY" means any one of them.
"CONSOLIDATED SCHEDULED FUNDED DEBT PAYMENTS" means, as of any date for
the applicable period ending on such date with respect to the Consolidated
Parties on a consolidated basis, the sum of all scheduled payments of
principal on Funded Indebtedness during such period (including the implied
principal component of payments due on Capital Leases during such period and
Synthetic Leases, less the reduction for all voluntary prepayments or
mandatory prepayments required pursuant to Section 3.3, in each case as
applied pursuant to Section 3.3), as determined in accordance with GAAP.
"CONSOLIDATED SENIOR LEVERAGE RATIO" means, as of the end of any fiscal
quarter of the Consolidated Parties for the four fiscal quarter period ending
on such date with respect to the Consolidated Parties on a consolidated
basis, the ratio of (a) Average Senior Debt on the last day of such period to
(b) Consolidated EBITDA for such period.
"CONSOLIDATED TOTAL ASSETS" means, as of any date with respect to the
Consolidated Parties on a consolidated basis, total assets, as determined in
accordance with GAAP.
"CONTINUE", "CONTINUATION" and "CONTINUED" shall refer to the
continuation pursuant to Section 3.2 hereof of a Eurodollar Loan from one
Interest Period to the next Interest Period.
"CONVERT", "CONVERSION" and "CONVERTED" shall refer to a conversion
pursuant to Section 3.2 or Sections 3.7 through 3.12, inclusive, of a Base
Rate Loan into a Eurodollar Loan.
11
"CREDIT AGREEMENT" shall have the meaning assigned to such term in the
heading hereof.
"CREDIT DOCUMENTS" means a collective reference to this Credit
Agreement, the Notes, the LOC Documents, each Joinder Agreement, the
Administrative Agent's Fee Letter and the Collateral Documents (in each case
as the same may be amended, modified, restated, supplemented, extended,
renewed or replaced from time to time), and "CREDIT DOCUMENT" means any one
of them.
"CREDIT FACILITIES" shall have the meaning assigned to such term in the
recitals hereto.
"CREDIT PARTIES" means a collective reference to the Borrower and the
Guarantors, and "CREDIT PARTY" means any one of them.
"CREDIT PARTY OBLIGATIONS" means, 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 Credit
Agreement or any of the other Credit Documents (including, but not limited
to, any interest accruing after the occurrence of a Bankruptcy Event 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 any Credit Party to any Lender, or
any Affiliate of a Lender, arising under any Hedging Agreement.
"DEBT ISSUANCE" means the issuance by any Consolidated Party of any
Indebtedness for borrowed money.
"DEBT ISSUANCE PREPAYMENT EVENT" means the receipt by any Consolidated
Party of proceeds from any Debt Issuance other than an Excluded Debt
Issuance.
"DEFAULT" means any event, act or condition which with notice or lapse
of time, or both, would constitute an Event of Default.
"DEFAULTING LENDER" means, at any time, any Lender that (a) has failed
to make a Loan or purchase a Participation Interest required pursuant to the
terms of this Credit Agreement within one Business Day of when due, (b) other
than as set forth in (a) above, has failed to pay to the Administrative Agent
or any Lender an amount owed by such Lender pursuant to the terms of this
Credit Agreement within one Business Day of when due, unless such amount is
subject to a good faith dispute or (c) has been deemed insolvent or has
become subject to a bankruptcy or insolvency proceeding or with respect to
which (or with respect to any of the assets of which) a receiver, trustee or
similar official has been appointed.
"DISCONTINUED OPERATIONS" means any of (i) the popcorn business, (ii)
the applesauce business, (iii) the Seneca copack arrangement and/or (iv) the
Xxxx Foods pickle copack arrangement.
12
"DISCONTINUED OPERATIONS SALE" means the sale of any of the
Discontinued Operations, or any portion thereof, resulting at any time in Net
Cash Proceeds realized by the Credit Parties in excess of $5,000,000 from
other than the sale of working capital from such Discontinued Operations.
"DOLLARS" and "$" means dollars in lawful currency of the United
States.
"DOMESTIC SUBSIDIARY" means any direct or indirect Subsidiary of the
Borrower that was formed under the laws of the United States or any state
thereof or the District of Columbia.
"EBITDA DISPOSITION LIMIT" means the sum of (i) $40,000,000 plus (ii)
in the event that any Consolidated Party makes an Acquisition after the
Closing Date, an amount equal to 40% of EBITDA (calculated on a basis
consistent with Consolidated EBITDA) attributable to the Person(s) and
Property acquired in such Acquisition for the most recent period of twelve
consecutive fiscal months preceding such Acquisition as reasonably determined
by the Borrower and the Administrative Agent.
"11 7/8% SENIOR SUBORDINATED INDENTURE" means the Indenture, dated as
of November 18, 1998, by and among Borrower, the guarantors named therein and
IBJ Xxxxxxxx Bank & Trust Company, as trustee, as such Indenture has been
amended to the date hereof, including pursuant to the Consent Solicitation,
and as may be further amended, modified, restated or supplemented and in
effect from time to time in accordance with the terms hereof.
"ELIGIBLE ASSIGNEE" means (i) a Lender; (ii) unless an assignment to
such Person would result in any increased cost to the Borrower under Section
3.6, 3.9 or 3.11, an Affiliate of a Lender or, with respect to any Lender
that is a fund that invests in bank loans, any other fund that invests in
bank loans which is an "accredited investor" and is managed or advised by the
same investment advisor that manages or advises such Lender or by an
Affiliate of such investment advisor; and (iii) any other Person approved by
the Administrative Agent (such approval by the Administrative Agent not to be
unreasonably withheld or delayed); provided, however, that neither the
Borrower nor any other Credit Party shall qualify as an Eligible Assignee and
in no event shall a competitor, customer or supplier of any Consolidated
Party or Affiliate thereof be an Eligible Assignee.
"ELIGIBLE REINVESTMENT" means (i) any acquisition (whether or not
constituting a capital expenditure, but not constituting an Acquisition) by a
Consolidated Party of assets or any business (or any substantial part
thereof) used or useful in the same or a substantially similar line of
business as the Consolidated Parties were engaged in on the Closing Date (or
any reasonable extensions or expansions thereof) and (ii) any Permitted
Acquisition. If any Subordinated Debt or Qualified Preferred Stock shall have
been issued, the term "Eligible Reinvestment" shall not include any item
which is not a permitted application of proceeds of an "Asset Sale" (or any
comparable term) under, and as defined in, any Junior Financing
Documentation.
13
"ENVIRONMENTAL LAWS" means any and all lawful and applicable Federal,
state, local and foreign statutes, laws (including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980
("CERCLA"), the Resource Conservation and Recovery Act of 1976, the Toxic
Substances Control Act, the Water Pollution Control Act, the Clean Air Act
and the Hazardous Materials Transportation Act), regulations, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or other governmental restrictions relating to the
environment or to emissions, discharges, releases or threatened releases of
pollutants, contaminants, chemicals, or industrial, toxic or hazardous
substances or wastes into the environment including, without limitation,
ambient air, surface water, ground water, or land, or otherwise relating to
the manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling of pollutants, contaminants, chemicals, or industrial,
toxic or hazardous substances or wastes.
"EQUITY INVESTORS" means a collective reference to (i) the Sponsor
together with certain of its affiliates, (ii) certain members of Pro-Fac,
(iii) Pro-Fac, (iv) any Person who beneficially owns, directly or indirectly,
any equity in Holdings LLC as of the Closing Date or within 90 days
thereafter, and (v) certain executives and beneficial and record shareholders
of the Acquired Company described in the Unit Purchase Agreement, and "EQUITY
INVESTOR" means any one of them.
"EQUITY ISSUANCE" means any issuance for cash by any Consolidated Party
to any Person of (a) shares of its Capital Stock, (b) any shares of its
Capital Stock pursuant to the exercise of options or warrants, (c) any shares
of its Capital Stock pursuant to the conversion of any debt securities to
equity or (d) any options or warrants relating to its Capital Stock. An
"Asset Disposition" shall not be deemed to be an Equity Issuance.
"EQUITY ISSUANCE PREPAYMENT EVENT" means, (i) with respect to any
Equity Issuance other than an Excluded Equity Issuance or an Equity Issuance
constituting a Qualifying IPO, the failure of the Credit Parties to apply (or
cause to be applied) the Net Cash Proceeds of such Equity Issuance to
Eligible Reinvestments during the Application Period for such Equity Issuance
and (ii) with respect to any Equity Issuance constituting a Qualifying IPO,
the receipt by any Consolidated Party of Net Cash Proceeds from such Equity
Issuance.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended, and any successor statute thereto, as interpreted by the rules and
regulations thereunder, all as the same may be in effect from time to time.
References to sections of ERISA shall be construed also to refer to any
successor sections.
"ERISA AFFILIATE" means an entity which is under common control with
any Consolidated Party within the meaning of Section 4001(a)(14) of ERISA, or
is a member of a group which includes any Consolidated Party and which is
treated as a single employer under Sections 414(b) or (c) of the Code.
14
"ERISA EVENT" means (i) with respect to any Plan, the occurrence of a
Reportable Event or the substantial cessation of operations (within the
meaning of Section 4062(e) of ERISA); (ii) the withdrawal by any Consolidated
Party or any ERISA Affiliate from a Multiple Employer Plan during a plan year
in which it was a substantial employer (as such term is defined in Section
4001(a)(2) of ERISA), or the termination of a Multiple Employer Plan; (iii)
the distribution of a notice of intent to terminate or the actual termination
of a Plan pursuant to Section 4041(a)(2) or 4041A of ERISA; (iv) the
institution of proceedings to terminate or the actual termination of a Plan
by the PBGC under Section 4042 of ERISA; (v) any event or condition which
could reasonably be expected to constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer,
any Plan; (vi) the complete or partial withdrawal of any Consolidated Party
or any ERISA Affiliate from a Multiemployer Plan; (vii) the conditions for
imposition of a lien under Section 302(f) of ERISA exist with respect to any
Plan; or (viii) the adoption of an amendment to any Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA.
"EURODOLLAR LOAN" means any Loan that bears interest at a rate based
upon the Eurodollar Rate.
"EURODOLLAR RATE" means, for any Eurodollar Loan for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) determined by the Administrative Agent to be equal to
the quotient obtained by dividing (a) the Interbank Offered Rate for such
Eurodollar Loan for such Interest Period by (b) 1 minus the Eurodollar
Reserve Requirement for such Eurodollar Loan for such Interest Period.
"EURODOLLAR RESERVE REQUIREMENT" means, at any time, the maximum rate
at which reserves (including, without limitation, any marginal, special,
supplemental, or emergency reserves) are required to be maintained under
regulations issued from time to time by the Board of Governors of the Federal
Reserve System (or any successor) by member banks of the Federal Reserve
System against "Eurocurrency liabilities" (as such term is used in Regulation
D). Without limiting the effect of the foregoing, the Eurodollar Reserve
Requirement shall reflect any other reserves required to be maintained by
such member banks with respect to (i) any category of liabilities which
includes deposits by reference to which the Eurodollar Rate is to be
determined, or (ii) any category of extensions of credit or other assets
which include Eurodollar Loans. The Eurodollar Rate shall be adjusted
automatically on and as of the effective date of any change in the Eurodollar
Reserve Requirement.
"EVENT OF DEFAULT" shall have the meaning assigned to such term in
Section 9.1.
"EXCESS CASH FLOW" means, with respect to any fiscal year period of the
Consolidated Parties on a consolidated basis, an amount equal to (i)
Consolidated EBITDA minus (ii) without duplication, (A) the aggregate amount
of Consolidated Capital Expenditures (including with respect to any CapEx
Rollover) made by Consolidated Parties during such fiscal year and permitted
hereunder or planned or
15
committed in such fiscal year to be made in the subsequent fiscal year, (B)
Consolidated Cash Interest Expense, (C) Consolidated Cash Taxes, including
cash payments for Federal, state and other income tax liabilities incurred
prior to the Closing Date, (D) Consolidated Scheduled Funded Debt Payments,
(E) without duplication of any item included under clause (B) above,
Restricted Payments made by the Consolidated Parties other than with the
proceeds of any Equity Issuance, to the extent that such Restricted Payments
are permitted to be made under Section 8.7, (F) voluntary prepayments of any
Indebtedness (other than the Credit Party Obligations), provided that (1)
such prepayments are otherwise permitted hereunder and (2) if such
Indebtedness consists of a revolving line of credit, the commitments under
such line of credit are permanently reduced by the amount of such prepayment,
(G) letter of credit fees, (H) proceeds received by the Consolidated Parties
from insurance claims with respect to casualty events, business interruption
or product recalls which reimburse prior business expenses, (I) all
extraordinary cash charges, (J) cash payments made in satisfaction of
non-current liabilities, (K) one-time cash fees and expenses incurred in
connection with the Transaction or, to the extent permitted hereunder, any
Asset Disposition, Permitted Investment, Equity Issuance or Debt Issuance
(whether or not consummated), (L) fees and expenses in connection with the
exchange or refinancing of the Subordinated Notes or GLK Note as permitted
hereunder, (M) cash indemnity payments received pursuant to indemnification
provisions in any agreement in connection with this Transaction and any
Permitted Acquisition (or in any similar agreement related to any other
Acquisition consummated prior to the Closing Date), (N) non-cash,
non-recurring charges, (O) other non-recurring cash charges in an aggregate
amount not to exceed $2,000,000 during any four consecutive fiscal quarter
period, (P) expenses in connection with payments made by any Consolidated
Party with respect to industrial revenue bond financings and Guaranty
Obligations in respect thereof, (Q) expenses incurred in connection with
deferred compensation arrangements in connection with the Transaction, (R)
management fees permitted to be made under Section 8.9, (S) expenses
representing the implied principal component under Synthetic Leases, (T)
annual agency fees described in the Administrative Agent's Fee Letter, (U)
cash costs associated with obtaining Hedging Agreements, (V) the Pro-Fac
Payment and the Pro-Fac Tax Payment, (W) amounts added back to Consolidated
EBITDA pursuant to clauses (T)(inventory reduction) and (U) (Discontinued
Operations) of the definition of Consolidated EBITDA during such period, (X)
payments made by any Consolidated Party with respect to any Permitted
Investment, (Y) payments made pursuant to Section 8.9(i)(B), (Z) the excess,
if any, of the aggregate principal amount advanced by the Borrower to Pro-Fac
pursuant to the loan facility permitted by Section 8.9(j) over the aggregate
principal amount repaid to the Borrower by Pro-Fac under such loan facility
during such period and (AA) the excess, if any, of the aggregate principal
amount loaned by the Borrower to GLK pursuant to the loan facility permitted
by Section 8.9(k) over the aggregate principal amount repaid to the Borrower
by GLK under such loan facility during such fiscal year plus/minus (iii)
changes in working capital (in the case of this clause (iii), with
appropriate adjustments for asset acquisitions and dispositions); provided,
however, solely with respect to the calculation of Excess Cash Flow for
fiscal year 2003, the applicable period for measuring the components thereof
shall commence on the Closing Date and end on June 30, 2003, except that with
respect to changes in working capital the relevant period
16
shall be the Borrower's 2003 fiscal year, but working capital shall be
adjusted for purchase accounting related to the Transaction.
"EXCESS PROCEEDS" shall have the meaning assigned to such term in
Section 7.6(b).
"EXCLUDED ASSET DISPOSITION" means, with respect to any Consolidated
Party, any Asset Disposition consisting of (i) the sale, lease, license,
transfer or other disposition of inventory or other assets in the ordinary
course of such Consolidated Party's business, (ii) the sale, lease, license,
transfer or other disposition of Property no longer used or useful in the
conduct of such Consolidated Party's business, (iii) any Involuntary
Disposition by such Consolidated Party, (iv) any sale, lease, license,
transfer or other disposition of Property by such Consolidated Party to any
Credit Party, provided that the Credit Parties shall cause to be executed and
delivered such documents, instruments and certificates as the Administrative
Agent may reasonably request so as to cause the Credit Parties to be in
compliance with the terms of Section 7.12 after giving effect to such
transaction, (v) any portion of an Asset Disposition by such Consolidated
Party constituting a Permitted Investment, (vi) if such Consolidated Party is
not a Credit Party, any sale, lease, license, transfer or other disposition
of Property by such Consolidated Party to any Consolidated Party that is not
a Credit Party, (vii) the sale or disposition of Cash Equivalents for fair
market value, (viii) any sale of accounts receivable in connection with the
compromise thereof, (ix) the assignment of past due accounts for collection,
(x) the licensing of Intellectual Property to third Persons on customary
terms as determined by the licensor's board of directors in good faith, (xi)
any Acquired Non-Core Asset Disposition or (xii) Discontinued Operations;
provided, however, that the term "Excluded Asset Disposition" shall not
include any Asset Disposition to the extent of the portion of the proceeds of
such Asset Disposition that would be required under any Junior Financing
Documentation to be applied to permanently retire Indebtedness of the
Consolidated Parties.
"EXCLUDED DEBT ISSUANCE" means any Debt Issuance permitted by Section
8.1 (other than Section 8.1(p)).
"EXCLUDED EQUITY ISSUANCE" means (i) any Equity Issuance by any
Consolidated Party to any other Consolidated Party, the Sponsor or any other
Equity Investors or any of the officers, directors or employees of a
Consolidated Party, (ii) any Equity Issuance by the Parent to the seller of a
business acquired in a Permitted Acquisition, (iii) any Equity Issuance by
the Parent the proceeds of which are used to finance a Permitted Acquisition
or an Investment in Joint Ventures and Foreign Subsidiaries permitted under
Section 8.6, (iv) any issuance of directors' qualifying shares or any similar
issuance, (v) any Equity Issuance to a lender in connection with a related
financing permitted hereunder, (vi) any Equity Issuance pursuant to the
exercise of options or warrants or conversion of any debt securities to
equity, (vii) any Equity Issuance in connection with a contemporaneous
repurchase of Capital Stock or (viii) any Qualified Preferred Stock issued
pursuant to Section 8.1(o); provided, however, that the term "Excluded Equity
Issuance" shall not include any Equity Issuance to the extent of the portion
of the proceeds of such Equity Issuance that would be required under any
17
Junior Financing Documentation to be applied to permanently retire
Indebtedness of the Consolidated Parties.
"EXCLUDED PROPERTY" means, with respect to any Credit Party, including
any Person that becomes a Credit Party after the Closing Date as contemplated
by Section 7.11, (i) any owned or leased real or personal Property of such
Credit Party which is located outside of the United States (other than that
portion of the Capital Stock of Material Foreign Subsidiaries required to be
pledged to the Administrative Agent pursuant to Section 7.12), (ii) any owned
real Property of such Credit Party which has a net book value of less than
$1,000,000, provided that the aggregate net book value of all real Property
of all of the Credit Parties excluded pursuant to this clause (ii) shall not
exceed $10,000,000, (iii) any leased real Property of such Credit Party which
(a) is designated as an "Excluded Property" on Schedule 6.20(a) or (b) at the
written request of the Borrower, the Administrative Agent has agreed in
writing in its reasonable discretion is not material, (iv) any leased
personal Property of such Credit Party, (v) any Property of such Credit Party
which, subject to the terms of Section 8.11 and Section 8.14, is subject to a
Lien of the type described in Section 8.2(h), Section 8.2(h) or, to the
extent constituting a Lien of the type described in Section 8.2(g) or Section
8.2(q), Section 8.2(x) pursuant to documents which prohibit such Credit Party
from granting any other Liens in such Property, (vi) owned motor vehicles of
such Credit Party, provided that the aggregate net book value of all owned
motor vehicles of all of the Credit Parties excluded pursuant to this clause
(vi) shall not exceed $7,500,000, (vii) contract rights (and related assets)
under contracts pertaining to the provision of goods or services to a
Consolidated Party and in respect of which the granting of a Lien is
prohibited under customary non-assignment provisions to the extent that such
provisions have not been waived and are effective under applicable law, and
(viii) Capital Stock of Joint Ventures and Foreign Subsidiaries which are not
Material Foreign Subsidiaries.
"EXECUTIVE OFFICER" of any Person means any of the chief executive
officer, chief operating officer, president, chief financial officer,
treasurer or assistant treasurer of such Person, or any other Person
designated as an "Executive Officer" by the chief executive officer, chief
operating officer, president or chief financial officer.
"EXISTING CREDIT AGREEMENT" means the Credit Agreement dated as of
September 23, 1998, as amended, among the Borrower and, the lenders party
thereto, Xxxxxx Trust and Savings Bank, as administrative agent, and Bank of
Montreal, as syndication agent.
"EXISTING LETTERS OF CREDIT" means the letters of credit described by
date of issuance, letter of credit number, undrawn amount, name of
beneficiary and date of expiry on Schedule 1.1B.
"FEDERAL FUNDS RATE" means, for any day, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day; provided that
18
(a) if such day is not a Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Business Day as
so published on the next succeeding Business Day, and (b) if no such rate is
so published on such next succeeding Business Day, the Federal Funds Rate for
such day shall be the average rate charged to the Administrative Agent (in
its individual capacity) on such day on such transactions as determined by
the Administrative Agent.
"FEES" means all fees payable pursuant to Section 3.5.
"FFDCA" means the Federal Food, Drug, and Cosmetic Act, as amended, 21
U.S.C. Section 301, et seq., and its implementing regulations.
"FOOD SECURITY ACT" means the Food Security Act of 1985, as amended,
and any successor statute thereto, including all rules and regulations
thereunder, all as the same may be in effect from time to time.
"FOREIGN BORROWING BASE" means, as of any date, an amount equal to (i)
80% of the aggregate face amount of accounts receivable of Foreign
Subsidiaries not more than 90 days past due as of the end of the most recent
fiscal quarter preceding such date plus (ii) 50% of the aggregate book value
of the inventory of Foreign Subsidiaries as of the end of the most recent
fiscal quarter preceding such date, all calculated on a consolidated basis
and in accordance with GAAP.
"FOREIGN SUBSIDIARY" means any direct or indirect Subsidiary of the
Borrower which is not a Domestic Subsidiary.
"FULLY SATISFIED" means, with respect to the Credit Party Obligations
as of any date, that, as of such date, (a) all principal of and interest
accrued to such date which constitute Credit Party Obligations shall have
been paid in full in cash, (b) all fees, expenses and other amounts then due
and payable which constitute Credit Party Obligations shall have been paid in
cash, (c) all outstanding Letters of Credit shall have been (i) terminated,
(ii) fully cash collateralized or (iii) secured by one or more letters of
credit on terms and conditions, and with one or more financial institutions,
reasonably satisfactory to the Issuing Lender and (d) the Commitments shall
have been expired or terminated in full.
"FUNDED INDEBTEDNESS" means, with respect to any Person, without
duplication, (a) all obligations of such Person for borrowed money, (b) 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), (c) all obligations of such
Person issued or assumed as the deferred purchase price of Property or
services purchased by such Person (other than accrued expenses and trade debt
incurred in the ordinary course of business) which would appear as
liabilities on a balance sheet of such Person and to the extent constituting
contingent obligations, (d) all Funded Indebtedness of others secured by (or
for which the holder of such Funded Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien
19
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, (e) the implied principal component of all obligations of such
Person under Capital Leases, (f) the amount of unreimbursed drawings and
funded outstandings under letters of credit issued or bankers' acceptances
facilities created for the account of such Person, (g) unless the holder
thereof is a Credit Party or, if the issuer thereof is a Consolidated Party
which is not a Credit Party, any other Consolidated Party, 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 (other than as a
result of a change of control or an Asset Disposition that does not in fact
result in a redemption of such preferred Capital Stock) at any time prior to
the Maturity Date, (h) the principal portion of all obligations of such
Person under Synthetic Leases and (i) the Funded Indebtedness of any
partnership or unincorporated joint venture in which such Person is a general
partner or a joint venturer to the extent such Funded Indebtedness is
recourse to such Person (it being agreed that such Funded Indebtedness shall
be deemed not to be recourse to such Person for purposes of this definition
if the only recourse of the holder of such Funded Indebtedness to such Person
is a pledge of the equity interests in such partnership or joint venture
owned by such Person and a related limited guarantee recourse solely to such
equity interests). Notwithstanding any other provision of this Credit
Agreement to the contrary, (i) the term "Funded Indebtedness" shall not be
deemed to include (w) any obligations of any Consolidated Party referred to
in Section 8.9(i), (x) any earn-out obligation until such obligation becomes
a liability on the balance sheet of the applicable Person, (y) any deferred
compensation arrangements or (z) any non-compete or consulting obligations
incurred in connection with Permitted Acquisitions, (ii) the amount of Funded
Indebtedness for which recourse is limited either to a specified amount or to
an identified asset of such Person shall be deemed to be equal to such
specified amount (or, if less, the fair market value of such identified
asset) and (iii) the amount of any Subordinated Debt shall be calculated
without regard to any purchase accounting adjustments.
"GAAP" means generally accepted accounting principles in the United
States applied on a consistent basis and subject to the terms of Section 1.3
(except, in respect of (i) Joint Ventures of the type described in clause
(ii) of the definition thereof set forth in this Section 1.1 and (ii)
Synthetic Leases, as otherwise treated herein).
"GLK" means Great Lakes Kraut Company, LLC, and its successors.
"GLK NOTE" means the Subordinated Promissory Note of the Borrower dated
as of September 23, 1998 and due November 22, 2008, originally payable to
Xxxx Foods Company in the original principal amount of $30,000,000, as
further amended, modified, supplemented, restated or refinanced from time to
time.
"GOVERNMENT ACTS" shall have the meaning assigned to such term in
Section 2.2(i)(i).
"GOVERNMENTAL AUTHORITY" means any Federal, state, local or foreign
court or governmental agency, authority, instrumentality or regulatory body.
20
"GUARANTORS" means a collective reference to the Parent and each of the
Subsidiary Guarantors, together with their successors and permitted assigns,
and "GUARANTOR " means any one of them.
"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 (or, if less, the maximum amount of such principal amount
for which such Person may be liable under the terms of the instrument(s)
evidencing such Guaranty Obligation).
"HEDGING AGREEMENTS" means any interest rate protection agreement,
commodities purchase agreement or foreign currency exchange agreement,
including any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled
by reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no
phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrower or the Subsidiaries shall be a Hedging Agreement.
"HOLDINGS LLC" means Agrilink Holdings LLC, a Delaware limited
liability company.
"INDEBTEDNESS" means, 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, (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 accrued expenses
and trade debt incurred in the ordinary course of business) which would
appear as liabilities on a
21
balance sheet of such Person, (e) 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, (f) all Guaranty
Obligations of such Person with respect to Indebtedness of another Person,
(g) the implied principal component of all obligations of such Person under
Capital Leases, (h) all net obligations of such Person (or, if less, the
exposure of such Person) under Hedging Agreements, (i) 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), (j) unless the holder thereof
is a Credit Party or, if the issuer thereof is a Consolidated Party which is
not a Credit Party, any other Consolidated Party, 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 (other than as a result of a
change of control or an Asset Disposition that does not in fact result in a
redemption of such preferred Capital Stock) at any time prior to the Maturity
Date, (k) the principal portion of all obligations of such Person under
Synthetic Leases and (l) the Indebtedness of any partnership or
unincorporated joint venture in which such Person is a general partner or a
joint venturer to the extent such Indebtedness is recourse to such Person (it
being agreed that such Indebtedness shall be deemed not to be recourse to
such Person for purposes of this definition if the only recourse of the
holder of such Indebtedness to such Person is a pledge of the equity
interests in such partnership or joint venture owned by such Person and a
related limited guarantee recourse solely to such equity interests).
Notwithstanding any other provision of this Credit Agreement to the contrary,
(i) the term "Indebtedness" shall not be deemed to include any earn-out
obligation until such obligation becomes a liability on the balance sheet of
the applicable Person, (ii) the amount of Indebtedness for which recourse is
limited either to a specified amount or to an identified asset of such Person
shall be deemed to be equal to such specified amount (or, if less, the fair
market value of such identified asset), (iii) any obligations of any
Consolidated Party referred to in Section 8.9(i) and (iv) the amount of any
Subordinated Debt shall be calculated without regard to any purchase
accounting adjustments.
"INDEMNIFIED PARTY" shall have the meaning assigned to such term in
Section 11.5(b).
"INTELLECTUAL PROPERTY" shall have the meaning assigned to such term in
Section 6.17.
"INTERBANK OFFERED RATE" means, for any Eurodollar Loan for any
Interest Period therefor, the rate per annum (rounded upwards, if necessary,
to the nearest 1/100 of 1%) appearing on Page 3750 (or any successor page) of
the Telerate Screen 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 "Interbank
Offered Rate" shall mean, for any Eurodollar Loan for any Interest Period
therefor, the rate per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%)
22
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 the rates referenced in the preceding two sentences
are not available, the term "Interbank Offered Rate" shall mean, for any
Eurodollar Loan for any Interest Period therefor, the rate per annum
determined by the Administrative Agent as the rate of interest (rounded
upwards, if necessary, to the nearest 1/100 of 1%) at which deposits in
Dollars for delivery on the first day of such Interest Period in same day
funds in the approximate amount of the Eurodollar Loan being made, continued
or converted by JPMorgan Chase Bank and with a term equivalent to such
Interest Period would be offered by JPMorgan Chase Bank's London Branch to
major banks in the offshore Dollar market at their request at approximately
11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period.
"INTEREST COVERAGE RATIO" means, as of the end of any fiscal quarter of
the Consolidated Parties for the four fiscal quarter period ending on such
date with respect to the Consolidated Parties on a consolidated basis, the
ratio of (a) Consolidated EBITDA for such period to (b) Consolidated Cash
Interest Expense for such period.
"INTEREST PAYMENT DATE" means (a) as to Base Rate Loans and Swingline
Loans (other than Quoted Rate Swingline Loans which shall be the date agreed
to by the Swingline Lender and Borrower), the last Business Day of each
March, June, September and December and the Maturity Date, and (b) as to
Eurodollar Loans, the last day of each applicable Interest Period and the
Maturity Date, and in addition where the applicable Interest Period for a
Eurodollar Loan is greater than three months, then also the date three months
from the beginning of the Interest Period and each three months thereafter.
"INTEREST PERIOD" means (i) as to Eurodollar Loans, a period of one,
two, three or six (or, to the extent available to all applicable Lenders,
nine or twelve) months' duration, as the Borrower may elect, commencing, in
each case, on the date of the borrowing (including continuations and
conversions thereof) and (ii) as to Quoted Rate Swingline Loans, a period
commencing on the date of the borrowing and ending on the date agreed to by
the Borrower and the Swingline Lender in accordance with Section 2.3(b)(i);
provided, however, (a) if any Interest Period would end on a day which is not
a Business Day, such Interest Period shall be extended to the next succeeding
Business Day (except that where the next succeeding Business Day falls in the
next succeeding calendar month, then on the next preceding Business Day), (b)
no Interest Period shall extend beyond the Maturity Date and (c) where an
Interest Period begins on a day for which there is no numerically
corresponding day in the calendar month in which the Interest Period is to
end, such Interest Period shall end on the last Business Day of such calendar
month.
"INVENTORY ADJUSTMENT" means (i) for any four fiscal quarter period of
the Consolidated Parties ending on or prior to September 30, 2002, $0.00;
(ii) for each four fiscal quarter period thereafter to and including the four
fiscal quarter period ending
23
September 30, 2004, an amount equal to 50% of the dollar reduction in average
inventory (such average inventory calculated based on the ending balance for
each of the last 12 months (with the last such month being the last day of
such fiscal quarter) and then compared with average inventory for the
comparable period ending one year earlier, other than for the Discontinued
Operations); (iii) for the four fiscal quarter period ending December 31,
2004, 75% of the Inventory Adjustment for the four fiscal quarter period
ending September 30, 2004, (iv) for the four fiscal quarter period ending
March 31, 2005, 50% of the Inventory Adjustment for the four fiscal quarter
period ending September 30, 2004, (v) for the four fiscal quarter period
ending June 30, 2005, 25% of the Inventory Adjustment for the four fiscal
quarter period ending September 30, 2004 and (vi) for any four fiscal quarter
period ending after June 30, 2005, $0.00. For (ii) through (v) above, in no
event shall such amount be greater than $15,000,000.
"INVESTMENT" in any Person means (a) the acquisition (whether for cash,
property, services, assumption of Indebtedness, securities or otherwise) of
Property (other than in the ordinary course of business and other than in a
transaction constituting a Consolidated Capital Expenditure), Capital Stock,
bonds, notes, debentures, partnership, joint ventures or other ownership
interests or other securities of such other Person, (b) any deposit with, or
advance, loan or other extension of credit to, such Person (other than
deposits made in connection with leases or the purchase of equipment,
inventory and other assets in the ordinary course of business) or (c) any
other capital contribution to or investment in such Person, including,
without limitation, any Guaranty Obligations (including any support for a
letter of credit issued on behalf of such Person) incurred for the benefit of
such Person and any portion of an Asset Disposition (other than an Excluded
Asset Disposition) to such Person for consideration less than the fair market
value of the Property disposed in such transaction, but excluding any
Restricted Payment to such Person. Investments which are capital
contributions or purchases of Capital Stock which have a right to participate
in the profits of the issuer thereof shall be valued at the amount actually
contributed or paid to purchase such Capital Stock as of the date of such
contribution or payment less all cash distributions and returns of capital
from the date such Investment is made through and including the date of
calculation. Investments which are loans, advances, extensions of credit or
Guaranty Obligations shall be valued at the principal amount of such loan,
advance or extension of credit outstanding as of the date of determination
or, as applicable, the principal amount of the loan or advance outstanding as
of the date of determination actually guaranteed by such Guaranty Obligation.
"INVOLUNTARY DISPOSITION" means any loss or casualty of, damage to or
destruction of, or any condemnation or other taking for public use of, any
Property of any Consolidated Party.
"INVOLUNTARY DISPOSITION PREPAYMENT EVENT" means, with respect to any
Involuntary Disposition, the failure of the Credit Parties to apply (or cause
to be applied) an amount equal to the Excess Proceeds of such Involuntary
Disposition, if any, to either (i) prepay the Loans (and cash collateralize
the LOC Obligations) in accordance with the terms of Section 3.3(b)(iii)(B)
or (ii) make Eligible Reinvestments (including but not limited to the repair
or replacement of the Property affected by such
24
Involuntary Disposition) within the period of 540 days following the date of
receipt of such Excess Proceeds (or such shorter period as specified in any
Junior Financing Documentation), subject to the terms and conditions of
Section 7.6(b).
"IPO ISSUER" means, in respect of a Qualifying IPO, the Person (as
among Holdings LLC, any parent company of Holdings LLC which owns 100% of the
Capital Stock of Holdings LLC (other than the Sponsor and its related funds),
the Parent or the Borrower and subject to the definition of the term "Change
of Control" set forth in this Section 1.1) that is the issuer of the common
Capital Stock offered in such Qualifying IPO.
"ISSUING LENDER" means JPMorgan Chase Bank and, with respect to the
Existing Letters of Credit, Xxxxxx Trust and Savings Bank.
"JOINDER AGREEMENT" means a Joinder Agreement substantially in the form
of Exhibit 7.11 hereto, executed and delivered by a new Guarantor in
accordance with the provisions of Section 7.11.
"JOINT VENTURE" means (i) any Person which would constitute an "equity
method investee" under GAAP of a Consolidated Party and (ii) any other Person
designated by the Credit Parties in writing to the Administrative Agent
(which designation shall be irrevocable) as a "Joint Venture" for purposes of
this Credit Agreement and more than 50% but less than 100% of whose Capital
Stock is directly owned by any Consolidated Party; provided, however, that
(a) no Person which is a Subsidiary of the Parent as of the Closing Date may
be designated by the Consolidated Parties as a Joint Venture and (b) GLK
shall be deemed to be Joint Venture until the Credit Parties designate in
writing to the Administrative Agent (which designation shall be irrevocable)
that GLK shall be a Subsidiary for purposes hereunder.
"JPMORGAN CHASE BANK" means JPMorgan Chase Bank and its successors.
"JUNIOR FINANCING DOCUMENTATION" means (i) the Subordinated Debt
Indentures, (ii) the Subordinated Notes, (iii) the GLK Note, (iv) any other
documentation governing any Subordinated Debt permitted to be incurred under
Section 8.1(f), (o), (p) or (r) and (v) any documentation governing any
Qualified Preferred Stock.
"LENDER" means any of the Persons identified as a "Lender" on the
signature pages hereto, and any Person which may become a Lender by way of
assignment in accordance with the terms hereof, together with their
successors and permitted assigns.
"LENDING PARTY" shall have the meaning assigned to such term in Section
11.14.
"LETTER OF CREDIT" means (i) any letter of credit issued by the Issuing
Lender for the account of the Borrower in accordance with the terms of
Section 2.2 and (ii) any Existing Letter of Credit, in each case including
any amendments thereto.
25
"LIEN" means any mortgage, pledge, hypothecation, collateral
assignment, deposit arrangement, security interest, encumbrance, lien
(statutory or otherwise), preference, priority or charge of any kind
(including any agreement to give any of the foregoing, any conditional sale
or other title retention agreement, any financing or similar statement or
notice filed under the Uniform Commercial Code as adopted and in effect in
the relevant jurisdiction or other similar recording or notice statute, and
any lease in the nature thereof).
"LOAN" or "LOANS" means the Revolving Loans, the Tranche B Term Loans
(or a portion of any Revolving Loan or Tranche B Term Loan bearing interest
at the Adjusted Base Rate or the Adjusted Eurodollar Rate and referred to as
a Base Rate Loan or a Eurodollar Loan) and/or the Swingline Loans (or any
Swingline Loan bearing interest at the Adjusted Base Rate or the Quoted Rate
and referred to as a Base Rate Loan or a Quoted Rate Swingline Loan),
individually or collectively, as appropriate.
"LOC COMMITMENT" means the commitment of the Issuing Lender to issue
Letters of Credit in an aggregate face amount at any time outstanding
(together with the amounts of any unreimbursed drawings thereon) of up to the
LOC Committed Amount.
"LOC COMMITTED AMOUNT" shall have the meaning assigned to such term in
Section 2.2.
"LOC DOCUMENTS" means, with respect to any Letter of Credit, such
Letter of Credit, any amendments thereto, any application therefor, and any
agreements, instruments, guarantees or other documents (whether general in
application or applicable only to such Letter of Credit) governing or
providing for the rights and obligations of the parties concerned or at risk.
"LOC OBLIGATIONS" means, at any time, the sum, without duplication, 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 by the Borrower.
"MATERIAL ADVERSE EFFECT" means a material adverse effect on (i) the
financial condition, operations, business, assets or liabilities of the
Consolidated Parties taken as a whole, (ii) the ability of the Credit Parties
(taken as a whole) to perform any material obligation under the Credit
Documents or (iii) the material rights and remedies of the Administrative
Agent and the Lenders under the Credit Documents.
"MATERIAL DOMESTIC SUBSIDIARY" means, at any time, (a) any Domestic
Subsidiary (i) which is directly owned by the Borrower or any Subsidiary and
(ii) with respect to which either (A) its annual revenues exceed $1,000,000
for the most recently ended twelve-month period or (B) its total assets, as
determined in accordance with GAAP, at such time is greater than $1,000,000
and (b) any Domestic Subsidiary which has incurred Indebtedness in excess of
$100,000; provided that (i) the aggregate annual
26
revenues of all non-Material Domestic Subsidiaries shall not exceed
$5,000,000 for the most recently ended twelve-month period, (ii) the
aggregate total assets of all non-Material Domestic Subsidiaries, as
determined in accordance with GAAP, shall not exceed $5,000,000 at any one
time and (iii) Seasonal Employers, Inc. shall be deemed not to be a Material
Domestic Subsidiary so long as it is engaged solely in the same type of
business as it is engaged as of the date hereof.
"MATERIAL FOREIGN SUBSIDIARY" means, at any time, any Foreign
Subsidiary (i) which is directly owned by the Borrower or any Domestic
Subsidiary and (ii) with respect to which either (a) the portion of
Consolidated EBITDA attributable to such Person and its Subsidiaries on a
consolidated basis for the most recently ended twelve-month period is 5% or
more of total Consolidated EBITDA for such period or (b) the portion of
Consolidated Total Assets owned by such Person and its Subsidiaries on a
consolidated basis at such time is 5% or more of total Consolidated Total
Assets at such time.
"MATERIALS OF ENVIRONMENTAL CONCERN" means 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 Laws, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
"MATURITY DATE" means (i) as to the Revolving Loans, Letters of Credit
(and the related LOC Obligations) and Swingline Loans, August 19, 2007 and
(ii) as to the Tranche B Term Loan, the earlier of (a) June 30, 2008 and (b)
the day which is 91 days before the scheduled maturity date of the
Subordinated Notes issued under the 11 7/8% Senior Subordinated Indenture or
the Senior Subordinated Refinancing Notes, if any.
"MOODY'S" means Xxxxx'x Investors Service, Inc., or any successor or
assignee of the business of such company in the business of rating
securities.
"MORTGAGE INSTRUMENTS" shall have the meaning assigned such term in
Section 5.1(e).
"MORTGAGED PROPERTIES" shall have the meaning assigned such term in
Section 5.1(e).
"MULTIEMPLOYER PLAN" means a Plan which is a "multiemployer plan" as
defined in Sections 3(37) or 4001(a)(3) of ERISA.
"MULTIPLE EMPLOYER PLAN" means a Plan (other than a Multiemployer Plan)
with respect to which any Consolidated Party or any ERISA Affiliate and at
least one employer other than the Consolidated Parties or any ERISA Affiliate
are contributing sponsors.
"NET CASH PROCEEDS" means the aggregate cash or Cash Equivalents
proceeds received by any Consolidated Party in respect of any Asset
Disposition, Equity Issuance, Debt Issuance or Involuntary Disposition, net
of (a) direct costs (including,
27
without limitation, legal, accounting and investment banking fees, and sales
commissions), (b) taxes paid or payable as a result thereof and (c) in the
case of any Asset Disposition, (i) the amount necessary to retire any
Indebtedness secured by a Permitted Lien (ranking senior to any Lien of the
Administrative Agent) on the related Property, (ii) any reserve for
adjustment in respect of (A) the sale price of such asset or assets
established in accordance with GAAP and (B) any liabilities associated with
such asset or assets and retained by the Consolidated Parties after such sale
or other disposition thereof, including, without limitation, pension and
other post-employment benefit liabilities and liabilities related to
environmental matters or against any indemnification obligations associated
with such transaction and (iii) reorganization, shut-down and severance costs
incurred during the Application Period for such Asset Disposition; it being
understood that "Net Cash Proceeds" shall include, without limitation, any
cash or Cash Equivalents received upon (i) the sale or other disposition of
any non-cash consideration received by any such Consolidated Party in any
Asset Disposition, Equity Issuance, Debt Issuance or Involuntary Disposition
or (ii) the reversal (without the satisfaction of expenses in cash in a
corresponding amount) of any reserve described in clause (ii) of the
preceding sentence. In addition, the "Net Cash Proceeds" of any Asset
Disposition shall include any other amounts which constitute "Net Proceeds"
(or any comparable term) of such transaction under, and as defined in, any
Junior Financing Documentation.
"NOTE" or "NOTES" means the Revolving Notes, the Tranche B Term Notes
and/or the Swingline Note, individually or collectively, as appropriate.
"NOTICE OF BORROWING" means a written notice of borrowing signed by an
Executive Officer of the Borrower in substantially the form of Exhibit
2.1(b)(i), as required by Section 2.1(b)(i) or Section 2.5(b).
"NOTICE OF EXTENSION/CONVERSION" means the written notice of extension
or conversion in substantially the form of Exhibit 3.2, as required by
Section 3.2.
"OTHER SUBORDINATED NOTES" shall have the meaning assigned to such term
in the definition of "Subordinated Notes".
"OTHER TAXES" shall have the meaning assigned to such term in Section
3.11(b).
"PACA" means the Perishable Agricultural Commodities Act as amended, 7
U.S.C. Section 499a, et seq. and its implementing regulations.
"PARENT" means the Person identified as such in the heading hereof,
together with any permitted successors and assigns.
"PARTICIPANT" shall have the meaning assigned to such term in Section
11.3.
"PARTICIPATION INTEREST" means a purchase by a Lender of a
participation in Letters of Credit or LOC Obligations as provided in Section
2.2, in Swingline Loans as
28
provided in Section 2.3 or in any Loans or other extensions of credit as
provided in Section 3.14.
"PBGC" means the Pension Benefit Guaranty Corporation established
pursuant to Subtitle A of Title IV of ERISA and any successor thereof.
"PERISHABLE AGRICULTURAL COMMODITIES" shall have the meaning assigned
to such term by PACA.
"PERMITTED ACQUISITION" means, at any time, an Acquisition by the
Borrower or any Subsidiary of the Borrower permitted at such time pursuant to
the terms of Section 8.6(h).
"PERMITTED ASSET DISPOSITION" means, at any time, (i) any Asset
Disposition permitted at such time by Section 8.5 and (ii) any Excluded Asset
Disposition.
"PERMITTED INVESTMENTS" means, at any time, Investments by the
Consolidated Parties permitted to exist at such time pursuant to the terms of
Section 8.6.
"PERMITTED LIENS" means, at any time, Liens in respect of Property of
the Consolidated Parties permitted to exist at such time pursuant to the
terms of Section 8.2.
"PERSON" means any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other
enterprise (whether or not incorporated) or any Governmental Authority.
"PLAN" means any employee benefit plan (as defined in Section 3(3) of
ERISA) which is subject to Title IV of ERISA and with respect to which any
Consolidated Party or any ERISA Affiliate is (or, if such plan were
terminated at such time, would under Section 4069 of ERISA be deemed to be)
an "employer" within the meaning of Section 3(5) of ERISA.
"PRIME RATE" means the per annum rate of interest established from time
to time by JPMorgan Chase Bank as its prime rate, which rate may not be the
lowest rate of interest charged by JPMorgan Chase Bank to its customers.
"PRINCIPAL AMORTIZATION PAYMENT" means a principal payment on the
Tranche B Term Loans as set forth in Section 2.5(d).
"PRINCIPAL AMORTIZATION PAYMENT DATE" means the date a Principal
Amortization Payment is due.
"PRINCIPAL OFFICE" means the principal office of JPMorgan Chase Bank,
presently located at New York, New York.
"PRO-FAC" means Pro-Fac Cooperative, Inc., a New York agricultural
cooperative corporation.
29
"PRO-FAC PAYMENT" shall have the meaning assigned to such term in
Section 8.9.
"PRO-FAC TAX PAYMENT" shall have the meaning assigned to such term in
Section 8.9.
"PRO FORMA BASIS" means, for purposes of calculating (utilizing the
principles set forth in the second paragraph of Section 1.3) compliance with
each of the financial covenants set forth in Section 7.10(a) and (b) in
respect of a proposed transaction, that such transaction shall be deemed to
have occurred as of the first day of the four fiscal-quarter period ending as
of the most recent fiscal quarter end preceding the date of such transaction
with respect to which the Administrative Agent has received the Required
Financial Information. As used herein, "TRANSACTION" shall mean (i) any Asset
Disposition as referred to in Section 8.5, (ii) any Acquisition as referred
to in Section 8.6(h), (iii) any Investment (or series of related Investments)
made pursuant to Section 8.6(p) to the extent consisting of the
contribution(s) or other transfer(s) of Property (other than cash) to a Joint
Venture for consideration less than the fair market value of such Property or
(iv) any other transaction permitted by this Agreement, expressly requiring
pro forma compliance with Section 7.10(a) and/or (b). In connection with any
calculation of the financial covenants set forth in Section 7.10(a) and (b)
upon giving effect to a transaction on a Pro Forma Basis:
(A) for purposes of any such calculation in respect of any Asset
Disposition as referred to in Section 8.5 or any Investment (or series
of related Investments) as referred to in Section 8.6(p), (1) income
statement items (whether positive or negative) attributable to the
Property disposed of or contributed or otherwise transferred, as
applicable, shall be excluded and (2) any Indebtedness which is retired
in connection with such transaction shall be excluded and deemed to
have been retired as of the first day of the applicable period; and
(B) for purposes of any such calculation in respect of any
Acquisition as referred to in Section 8.6(h) or any other such
transaction, (1) any Indebtedness incurred by any Consolidated Party in
connection with such transaction (x) shall be deemed to have been
incurred as of the first day of the applicable period and (y) if such
Indebtedness has a floating or formula rate, shall have an implied rate
of interest for the applicable period for purposes of this definition
determined by utilizing the rate which is or would be in effect with
respect to such Indebtedness as at the relevant date of determination,
(2) if applicable, income statement items (whether positive or
negative) attributable to the Person or Property acquired shall be
included beginning as of the first day of the applicable period, (3)
any Indebtedness which is retired in connection with such transaction
shall be excluded and deemed to have been retired as of the first day
of the applicable period and (4) if an acquisition, pro forma
adjustments may be included to the extent that such adjustments are
consistent with the definition of "Consolidated EBITDA" set forth in
this Section 1.1 and give effect to events that are (x) directly
attributable to such transaction, (y) expected to have a continuing
impact on the Consolidated Parties and (z) factually supportable.
30
"PRO FORMA COMPLIANCE CERTIFICATE" means a certificate of an Executive
Officer of the Borrower delivered to the Administrative Agent in connection
with (i) any Asset Disposition as referred to in Section 8.5, (ii) any
Acquisition as referred to in Section 8.6(h), (iii) any Investment (or series
of related Investments) made pursuant to Section 8.6(p) to the extent
consisting of the contribution(s) or other transfer(s) of Property (other
than cash) to a Joint Venture for consideration less than the fair market
value of such Property or (iv) any other transaction permitted by this
Agreement expressly requiring pro forma compliance with Section 7.10(a)
and/or (b), as applicable, and containing reasonably detailed calculations,
upon giving effect to the applicable transaction on a Pro Forma Basis, of the
financial covenants set forth in Section 7.10(a) and (b) as of the most
recent fiscal quarter end preceding the date of the applicable transaction
with respect to which the Administrative Agent shall have received the
Required Financial Information.
"PROPERTY" means any interest in any kind of property or asset, whether
real, personal or mixed, or tangible or intangible.
"PURCHASE RELATED AGREEMENTS" means, collectively, the Management
Services Agreement, the Securityholders Agreement, the Amended and Restated
Marketing and Facilitation Agreement and the Termination Agreement, as
defined in the Unit Purchase Agreement and as in effect on the date hereof,
as the same may be amended, modified, restated or supplemented from time to
time in accordance with the terms hereof.
"QUALIFIED PREFERRED STOCK" means any preferred Capital Stock issued by
the Parent or the Borrower (i) which constitutes Indebtedness under clause
(j) of the definition thereof and (ii) that is subordinated to the Credit
Party Obligations on terms no less favorable to the Lenders than the
Subordinated Debt Indenture for the 11 7/8% Senior Subordinated Notes and
permits the Credit Facilities and guarantees and collateral security
therefor.
"QUALIFYING IPO" means an Equity Issuance by the IPO Issuer (subject to
the definition of the term "Change of Control" set forth in Section 1.1)
consisting of an underwritten primary public offering (other than a public
offering pursuant to a registration statement on Form S-8) of its common
Capital Stock (i) pursuant to an effective registration statement filed with
the Securities and Exchange Commission in accordance with the Securities Act
(whether alone or in connection with a secondary public offering) and (ii)
resulting in gross proceeds to the IPO Issuer of at least $50,000,000.
"QUOTED RATE" means, with respect to any Quoted Rate Swingline Loan,
the fixed percentage rate per annum offered by the Swingline Lender and
accepted by the Borrower with respect to such Swingline Loan as provided in
accordance with the provisions of Section 2.3.
"QUOTED RATE SWINGLINE LOAN" means a Swingline Loan bearing interest at
a Quoted Rate.
31
"REAL PROPERTIES" means, at any time, a collective reference to each of
the real properties owned, leased or operated by the Consolidated Parties at
such time.
"REGISTER" shall have the meaning assigned to such term in Section
11.3(b)(iv).
"REGULATION D, T, U, OR X" means Regulation D, T, U or X, respectively,
of the Board of Governors of the Federal Reserve System as from time to time
in effect and any successor to all or a portion thereof.
"REPORTABLE EVENT" means any of the events set forth in Section 4043(c)
of ERISA, other than those events as to which the notice requirement has been
waived by regulation.
"REQUIRED FINANCIAL INFORMATION" means, with respect to the applicable
Calculation Date, (i) the financial statements of the Consolidated Parties
required to be delivered pursuant to Section 7.1(a) or (b) for the fiscal
period or quarter ending as of such Calculation Date, and (ii) the
certificate of an Executive Officer of the Borrower required by Section
7.1(c) to be delivered with the financial statements described in clause (i)
above.
"REQUIRED LENDERS" means, at any time, Lenders (other than Defaulting
Lenders but including at least two Lenders having Revolving Commitments)
holding in the aggregate at least a majority of (i) the Revolving Commitments
and the outstanding Tranche B Loans or (ii) if all of the Revolving
Commitments have been terminated, the outstanding Loans and LOC Obligations
(including, without limitation, Participation Interests).
"REQUIREMENT OF LAW" means, as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of
such Person, and any 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 to which any of its material
property is subject.
"RESTRICTED PAYMENT" means (i) any dividend or other payment or
distribution, direct or indirect, on account of any shares of any class of
Capital Stock of any Consolidated Party, now or hereafter outstanding
(including without limitation any payment in connection with any dissolution,
merger, consolidation or disposition involving any Consolidated Party), or to
the holders, in their capacity as such, of any shares of any class of Capital
Stock of any Consolidated Party, now or hereafter outstanding (other than
dividends or distributions (including distributions in connection with any
restructure, merger, consolidation or disposition) payable (A) in Capital
Stock of the applicable Person, (B) to any Credit Party (other than the
Parent) or (C) except in the case of the Borrower or the Parent, ratably to
minority shareholders of the applicable Person), (ii) 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
any Consolidated Party, now or hereafter outstanding, (iii) any payment made
to retire,
32
or to obtain the surrender of, any outstanding warrants, options or other
rights to acquire shares of any class of Capital Stock of any Consolidated
Party, now or hereafter outstanding and (iv) any payment or prepayment of
principal of, premium, if any, or interest on, including any redemption,
purchase, retirement, defeasance, sinking fund or similar payment with
respect to, any Subordinated Debt or Qualified Preferred Stock. The
cancellation of Indebtedness shall not be deemed to constitute a "Restricted
Payment".
"REVOLVING COMMITMENT" means, with respect to each Lender, the
commitment of such Lender in an aggregate principal amount at any time
outstanding of up to such Lender's Revolving Commitment Percentage (if any)
of the Revolving Committed Amount, (i) to make Revolving Loans in accordance
with the provisions of Section 2.1(a), (ii) to purchase Participation
Interests in Letters of Credit in accordance with the provisions of Section
2.2(c) and (iii) to purchase Participation Interests in Swingline Loans in
accordance with the provisions of Section 2.3(b)(iii).
"REVOLVING COMMITMENT PERCENTAGE" means, for any 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 11.3.
"REVOLVING COMMITTED AMOUNT" shall have the meaning assigned to such
term in Section 2.1(a).
"REVOLVING LENDER" each Lender that has Revolving Commitments or holds
Revolving Loans.
"REVOLVING LOANS" shall have the meaning assigned to such term in
Section 2.1(a).
"REVOLVING NOTE" shall have the meaning assigned to such term in
Section 2.1(e).
"S&P" means Standard & Poor's Ratings Group, a division of The McGraw
Hill Companies, Inc., or any successor or assignee of the business of such
division in the business of rating securities.
"SALE AND LEASEBACK TRANSACTION" means any direct or indirect
arrangement with any Person or to which any such Person is a party, providing
for the leasing to any Consolidated Party of any Property, whether owned by
such Consolidated Party as of the Closing Date or later acquired, which has
been or is to be sold or transferred by such Consolidated Party to such
Person or to any other Person from whom funds have been, or are to be,
advanced by such Person on the security of such Property.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and all
regulations issued pursuant thereto.
33
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and all regulations issued pursuant thereto.
"SENIOR SUBORDINATED REFINANCING INDENTURE" means the indenture to be
entered into by the Borrower to evidence subordinated Indebtedness incurred
pursuant to Section 8.1(f) in order to refinance the Subordinated Notes
issued pursuant to the 11 7/8% Senior Subordinated Indenture to the extent
permitted by Section 8.1(f), as the same may be amended, modified, restated
or supplemented from time to time in accordance with the terms hereof.
"SENIOR SUBORDINATED REFINANCING NOTES" means the subordinated
promissory notes issued by the Borrower pursuant to the Senior Subordinated
Refinancing Indenture, as the same may be amended, modified, restated or
supplemented from time to time in accordance with the terms hereof.
"SINGLE EMPLOYER PLAN" means any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan or a Multiple Employer Plan.
"SOLVENT" or "SOLVENCY" means, with respect to any Person as of a
particular date, that on such date (i) such Person is able to pay its debts
and other liabilities, contingent obligations and other commitments as they
mature in the normal course of business, (ii) such Person does not intend to,
and does not believe that it will, incur debts or liabilities beyond such
Person's ability generally to pay its debts and liabilities as they mature in
their ordinary course, (iii) such Person is not engaged in a business or a
transaction, and is not about to engage in a business or a transaction, for
which such Person's Property would constitute unreasonably small capital
after giving due consideration to the prevailing practice in the industry in
which such Person is engaged or is to engage, (iv) the fair value of the
Property of such Person on a going concern basis is greater than the total
amount of liabilities, including, without limitation, contingent liabilities,
of such Person and (v) the present fair salable value of the assets of such
Person is not less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and matured. In
computing the amount of contingent liabilities at any time, it is intended
that such liabilities will be computed at the amount which, in light of all
the facts and circumstances existing at such time, represents the amount that
can reasonably be expected to become an actual or matured liability.
"SPONSOR" means Vestar Capital Partners IV, L.P. and its Affiliates.
"STANDBY LETTER OF CREDIT FEE" shall have the meaning assigned to such
term in Section 3.5(b)(i).
"SUBORDINATED DEBT" means (i) any Indebtedness evidenced and governed
by the Subordinated Debt Indentures, the GLK Note and the Subordinated Notes,
including any guarantees thereof by any Credit Party and (ii) any other
Indebtedness which is subordinated to the Credit Party Obligations on terms
no less favorable to the
34
Lenders than the 11 7/8% Senior Subordinated Indenture and permits the Credit
Facilities and guarantees and collateral security therefor.
"SUBORDINATED DEBT INDENTURES" means, collectively, the 11 7/8% Senior
Subordinated Indenture, the Senior Subordinated Refinancing Indenture, if
any, the 12 1/4% Senior Subordinated Indenture and any indenture or agreement
evidencing Subordinated Debt incurred pursuant to Section 8.1(o), (p) or (r).
"SUBORDINATED NOTES" means any of the (a) 11 7/8% Senior Subordinated
Notes due 2008 issued by the Borrower pursuant to the 11 7/8% Senior
Subordinated Indenture, as such subordinated promissory note may be amended,
modified, exchanged, restated or supplemented and in effect from time to time
in accordance with the terms hereof, (b) 12 1/4% Senior Subordinated Notes
due 2005 issued by the Borrower pursuant to the 12 1/4% Senior Subordinated
Indenture, as such subordinated promissory note may be amended, modified,
exchanged, restated or supplemented and in effect from time to time in
accordance with the terms hereof, (c) the Senior Subordinated Refinancing
Notes and (d) any notes or other instruments evidencing Subordinated Debt
("OTHER SUBORDINATED NOTES") incurred pursuant to Section 8.1(o), (p) or (r).
"SUBSIDIARY" means, as to any Person at any time, (a) any corporation
more than 50% of whose Capital Stock of any class or classes having by the
terms thereof ordinary voting power to elect a majority of the directors of
such corporation (irrespective of whether or not at such time, any class or
classes of such corporation shall have or might have voting power by reason
of the happening of any contingency) is at such time owned by such Person
directly or indirectly through Subsidiaries, and (b) any partnership,
association, joint venture or other entity of which such Person directly or
indirectly through Subsidiaries owns at such time more than 50% of the
Capital Stock; provided, however, that, notwithstanding any other provision
to the contrary contained in this Credit Agreement, a Joint Venture shall not
constitute a Subsidiary.
"SUBSIDIARY GUARANTOR" means each of the Persons identified as a
"Subsidiary Guarantor" on the signature pages hereto and each Person which
may hereafter execute a Joinder Agreement pursuant to Section 7.11, together
with their successors and permitted assigns, and "SUBSIDIARY GUARANTOR" means
any one of them.
"SWINGLINE COMMITTED AMOUNT" shall have the meaning assigned to such
term in Section 2.3(a).
"SWINGLINE LENDER" means JPMorgan Chase Bank.
"SWINGLINE LOAN" shall have the meaning assigned to such term in
Section 2.3(a).
"SWINGLINE NOTE" shall have the meaning assigned to such term in
Section 2.3(d).
35
"SYNDICATION AGENT" shall have the meaning assigned to such term in the
heading hereof, together with any successors or assigns.
"SYNTHETIC LEASE" means any synthetic lease, tax retention operating
lease, off-balance sheet loan or similar off-balance sheet financing product
where such transaction is considered borrowed money indebtedness for tax
purposes but is classified as an operating lease under GAAP.
"TAXES" shall have the meaning assigned to such term in Section
3.11(a).
"TITLE INSURANCE COMPANY" shall have the meaning assigned to such term
in Section 5.1(e)(iii).
"TRADE LETTER OF CREDIT FEE" shall have the meaning assigned to such
term in Section 3.5(b)(ii).
"TRANCHE B TERM LOAN" shall have the meaning assigned to such term in
Section 2.5(a).
"TRANCHE B TERM LOAN COMMITMENT" means, with respect to each Lender,
the commitment of such Lender to make its portion of the Tranche B Term Loan
in a principal amount equal to such Lender's Tranche B Term Loan Percentage
(if any) of the Tranche B Term Loan Committed Amount.
"TRANCHE B TERM LOAN COMMITTED AMOUNT" shall have the meaning assigned
to such term in Section 2.5(a).
"TRANCHE B TERM LOAN PERCENTAGE" means, for any Lender, the percentage
identified as its Tranche B Term Loan 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 11.3.
"TRANCHE B TERM NOTE" shall have the meaning assigned to such term in
Section 2.5(f).
"TRANSACTION" means a collective reference to (a) (i) the investment by
the existing Equity Investors in preferred and common units of Holdings LLC
pursuant to the Unit Purchase Agreement and the other transactions
contemplated by Article I of the Unit Purchase Agreement, (ii) Pro-Fac's
contribution of all of the capital stock of the Borrower to Holdings LLC,
(iii) the formation by Holdings LLC of the Parent, (iv) the contribution by
Holdings LLC of all of (A) the capital stock of Borrower and (B) the proceeds
of the Equity Investors' investment to the capital of the Parent, (v) the
contribution by the Parent of the proceeds of the existing Equity Investors'
investment in Holdings LLC to the Borrower, all in accordance with the Unit
Purchase Agreement; (b) the repayment in full and termination of the Existing
Credit Agreement (other than Existing Letters of Credit); and (c) the related
consent solicitations, equity contributions and other transaction described
in Section 5.1(h).
36
"12 1/4% SENIOR SUBORDINATED INDENTURE" means that certain Indenture,
dated as of November 3, 1994, by and among Borrower, the guarantors named
therein and IBJ Xxxxxxxx Bank & Trust Company, as such Indenture may be
amended, modified, restated or supplemented and in effect from time to time
in accordance with the terms hereof.
"UNIT PURCHASE AGREEMENT" means the Unit Purchase Agreement, dated as
of June 20, 2002, by and among Holdings LLC, the Borrower and Pro-Fac,
including the exhibits and schedules thereto, as amended, modified, restated
or supplemented and in effect from time to time.
"UNUSED FEE" shall have the meaning assigned to such term in Section
3.5(a).
"UNUSED FEE CALCULATION PERIOD" shall have the meaning assigned to such
term in Section 3.5(a).
"UNUSED REVOLVING COMMITTED AMOUNT" means, for any period, the amount
by which (a) the then applicable Revolving Committed Amount (other than any
portion of the Revolving Committed Amount attributable to a Lender that was a
Defaulting Lender during such period) exceeds (b) the daily average sum for
such period of (i) the outstanding aggregate principal amount of all
Revolving Loans (but not including any Swingline Loans) plus (ii) the
outstanding aggregate principal amount of all LOC Obligations.
"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.
"WHOLLY OWNED SUBSIDIARY" of any Person means any Subsidiary 100% of
whose Voting Stock (other than director's qualifying shares or other shares
required by law to be held by a third party) is at the time owned by such
Person directly or indirectly through other Wholly-Owned Subsidiaries.
1.2. COMPUTATION OF TIME PERIODS.
For purposes of computation of periods of time hereunder, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding."
1.3. ACCOUNTING TERMS.
Except as otherwise expressly provided herein, all accounting terms
used herein shall be interpreted, and all financial statements and certificates
and reports as to financial matters required to be delivered to the Lenders
hereunder shall be prepared, in accordance with GAAP applied on a consistent
basis except as otherwise expressly provided herein; provided, however, that
calculations of the implied principal component of all obligations under any
Synthetic Lease or the implied interest component of any rent paid under any
Synthetic Lease
37
shall be made by the Borrower in accordance with accepted financial practice and
consistent with the terms of such Synthetic Lease. All calculations made for the
purposes of determining compliance with this Credit Agreement shall (except as
otherwise expressly provided herein) be made by application of GAAP applied on a
basis consistent (except for changes which are immaterial and not adverse to the
Lenders) with the most recent annual or quarterly financial statements delivered
pursuant to Section 7.1 (or, prior to the delivery of the first financial
statements pursuant to Section 7.1, consistent with the financial statements as
at March 30, 2002), but, in any event, unless otherwise expressly provided
herein, after elimination for minority interests; provided, however, if (a) the
Credit Parties shall object to determining such compliance on such basis at the
time of delivery of such financial statements due to any change in GAAP or the
rules promulgated with respect thereto or (b) the Administrative Agent or the
Required Lenders shall so object in writing within 30 days after delivery of
such financial statements, then such calculations shall be made on a basis
consistent with the most recent financial statements delivered by the Credit
Parties to the Lenders as to which no such objection shall have been made and
the parties shall negotiate in good faith to revise the applicable covenants to
reflect such changes in GAAP in a manner consistent with the Credit Agreement;
provided, further, however, that nothing contained in this Section 1.3 shall be
deemed to restrict the ability of the Credit Parties to (i) make purchase
accounting adjustments with respect to the Transaction during the four-quarter
period immediately succeeding the consummation of the Transaction or (ii) make
purchase accounting adjustments with respect to any Permitted Acquisition during
the four-quarter period immediately succeeding the consummation of such
transaction.
Notwithstanding the above or the terms of any definition in
Section 1.1, the parties hereto acknowledge and agree that, for purposes of all
calculations made under the financial covenants set forth in Section 7.10
(including without limitation for purposes of the definitions of "Applicable
Percentage" and "Pro Forma Basis" set forth in Section 1.1), (i) after
consummation of any Asset Disposition or any Investment (or series of related
Investments) made pursuant to Section 8.6(p) to the extent consisting of the
contribution(s) or other transfer(s) of Property (other than cash) to a Joint
Venture for consideration less than the fair market value of such Property, (A)
income statement items (whether positive or negative) and capital expenditures
attributable to the Property disposed of or contributed or otherwise
transferred, as applicable, shall be excluded to the extent relating to any
period occurring prior to the date of such transaction and (B) Indebtedness
which is retired shall be excluded and deemed to have been retired as of the
first day of the applicable period and (ii) after consummation of any
Acquisition, (A) income statement items (whether positive or negative)
attributable to the Person or Property acquired shall, to the extent not
otherwise included in such income statement items for the Consolidated Parties
in accordance with GAAP or in accordance with any defined terms set forth in
Section 1.1, be included to the extent relating to any period applicable in such
calculations, (B) to the extent not retired in connection with such Acquisition,
Indebtedness of the Person or Property acquired shall be deemed to have been
incurred as of the first day of the applicable period and Indebtedness which is
retired shall be excluded and deemed to have been retired as of the first day of
the applicable period and (C) pro forma adjustments may be included to the
extent that such adjustments are consistent with the definition of "Consolidated
EBITDA" set forth in Section 1.1 and give effect to events that are (x) directly
attributable to such transaction, (y) expected to have a continuing impact on
the Consolidated Parties and (z) factually supportable.
38
SECTION II
CREDIT FACILITIES
2.1. REVOLVING LOANS.
(a) REVOLVING COMMITMENT. 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 such Lender's
Revolving Commitment Percentage of revolving credit loans requested by the
Borrower in Dollars ("REVOLVING LOANS") from time to time from the Closing Date
until the Maturity Date, or such earlier date as the Revolving Commitments shall
have been terminated as provided herein; provided, however, that the sum of the
aggregate outstanding principal amount of Revolving Loans shall not exceed TWO
HUNDRED MILLION DOLLARS ($200,000,000) (as such aggregate maximum amount may be
reduced from time to time as provided in Section 3.4, the "REVOLVING COMMITTED
AMOUNT"); provided, further, (A) with regard to each Lender individually, such
Lender's outstanding Revolving Loans shall not exceed such Lender's Revolving
Commitment Percentage of the Revolving Committed Amount, and (B) the sum of the
aggregate outstanding principal amount of Revolving Loans plus LOC Obligations
plus Swingline Loans shall not exceed the Revolving Committed Amount. The
initial advance of the Revolving Loans on the Closing Date shall consist solely
of Base Rate Loans. Thereafter, Revolving Loans may consist of Base Rate Loans
or Eurodollar Loans, or a combination thereof, as the Borrower may request;
provided, however, that no more than 15 Eurodollar Loans shall be outstanding
hereunder at any time (it being understood that, for purposes hereof, Eurodollar
Loans with different Interest Periods shall be considered as separate Eurodollar
Loans, even if they begin on the same date, 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 Eurodollar Loan with a
single Interest Period). Revolving Loans hereunder may be repaid and reborrowed
in accordance with the provisions hereof.
(b) REVOLVING LOAN BORROWINGS.
(i) NOTICE OF BORROWING. The Borrower shall request a Revolving
Loan borrowing by written notice (or telephonic notice promptly confirmed in
writing) to the Administrative Agent not later than 12:30 P.M. (New York City
time) on the Business Day prior to the date of the requested borrowing in the
case of Base Rate Loans, and on the third Business Day prior to the date of
the requested borrowing in the case of Eurodollar 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, and (D)
whether the borrowing shall be comprised of Base Rate Loans, Eurodollar Loans
or a combination thereof, and if Eurodollar Loans are requested, the Interest
Period(s) therefor. If the Borrower shall fail to specify in any such Notice
of Borrowing (I) an applicable Interest Period in the case of a Eurodollar
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 a Base Rate Loan hereunder. The
Administrative Agent shall give notice to each affected Lender promptly
39
upon receipt of each Notice of Borrowing pursuant to this Section 2.1(b)(i),
the contents thereof and each such Lender's share of any borrowing to be made
pursuant thereto.
(ii) MINIMUM AMOUNTS. Except for Revolving Loans made for the
purpose of reimbursing the Issuing Lender in respect of a drawing under a
Letter of Credit pursuant to Section 2.2(e), each Eurodollar Loan that is a
Revolving Loan shall be in a minimum aggregate principal amount of $2,000,000
and each Base Rate Loan that is a Revolving Loan shall be in a minimum
aggregate principal amount of $1,000,000 and, in each case, integral
multiples of $100,000 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 as specified in Section 3.15(a), or in
such other manner as the Administrative Agent may specify in writing, by 1:00
P.M. (New York City 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 either by disbursing such funds pursuant to written
instructions from the Borrower or 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.
(c) REPAYMENT. The Borrower hereby promises to pay the principal amount
of all outstanding Revolving Loans in full on the Maturity Date, unless
accelerated sooner pursuant to Section 9.2.
(d) INTEREST. Subject to the provisions of Section 3.1,
(i) BASE RATE LOANS. During such periods as Revolving Loans shall
be comprised in whole or in part of Base Rate Loans, such Base Rate Loans
shall bear interest at a per annum rate equal to the Adjusted Base Rate.
(ii) EURODOLLAR LOANS. During such periods as Revolving Loans
shall be comprised in whole or in part of Eurodollar Loans, such Eurodollar
Loans shall bear interest at a per annum rate equal to the Adjusted
Eurodollar Rate.
The Borrower hereby promises to pay interest on Revolving Loans in arrears on
each applicable Interest Payment Date (or at such other times as may be
specified herein).
(e) REVOLVING NOTES. The Borrower hereby agrees that, upon the request
to the Administrative Agent by any Lender, the Borrower will execute and deliver
to such Lender a promissory note evidencing the Revolving Loans of such Lender,
substantially in the form of Exhibit 2.1(e), with appropriate insertions as to
date and principal amount (a "REVOLVING NOTE").
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2.2. LETTER OF CREDIT SUBFACILITY.
(a) ISSUANCE. Subject to the terms and conditions hereof and in
reliance upon the representations and warranties set forth herein, the Issuing
Lender agrees to issue, and each Lender severally agrees to participate in the
issuance by the Issuing Lender of, standby and trade Letters of Credit in
Dollars from time to time from the Closing Date until the date five (5) days
prior to the Maturity Date as the Borrower may request, in a form acceptable to
the Issuing Lender; provided, however, that (i) the LOC Obligations outstanding
shall not at any time exceed FORTY MILLION DOLLARS ($40,000,000) (the "LOC
COMMITTED AMOUNT") and (ii) the sum of the aggregate outstanding principal
amount of Revolving Loans plus LOC Obligations plus Swingline Loans shall not at
any time exceed the Revolving Committed Amount. No Letter of Credit shall (x)
have an original expiry date more than one year from the date of issuance
(provided that any such Letter of Credit may contain customary "evergreen"
provisions pursuant to which the expiry date is automatically extended by a
specific time period unless the Issuing Lender gives notice to the beneficiary
of such Letter of Credit at least a specified time period prior to the expiry
date then in effect) or (y) as originally issued or as extended, have an expiry
date extending beyond the date five (5) days prior to the Maturity Date. The
Issuing Lender shall not be required to issue any Letter of Credit which would
violate any Requirement of Law applicable to the Issuing Lender. Each Letter of
Credit shall comply with the related LOC Documents. The issuance and expiry
dates of each Letter of Credit shall be a Business Day. For purposes of this
Credit Agreement, the Existing Letters of Credit shall be deemed to have been
issued on the Closing Date.
(b) NOTICE AND REPORTS. The request for the issuance of a Letter of
Credit shall be submitted by an Executive Officer of the Borrower to the Issuing
Lender and the Administrative Agent at least three (3) Business Days prior to
the requested date of issuance. The Issuing Lender will provide to the
Administrative Agent, at least quarterly and more frequently upon request, who
will in turn disseminate to each of 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 the prior report, and
including therein, among other things, the beneficiary, the face amount and the
expiry date, as well as any payment or expirations which may have occurred.
(c) PARTICIPATION. Each Revolving Lender, upon issuance of a Letter of
Credit (or, in the case of each Existing Letter of Credit, on the Closing Date),
shall be deemed to have purchased without recourse a Participation Interest 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 pro rata share of the obligations under such Letter of Credit (based on
the respective Revolving Commitment Percentages of the Revolving Lenders) and
shall absolutely, unconditionally and irrevocably assume and be obligated to pay
to the Issuing Lender and discharge when due, its pro rata share of the
obligations arising under such Letter of Credit. Without limiting the scope and
nature of each Revolving Lender's Participation Interest in any Letter of
Credit, to the extent that the Issuing Lender has not been reimbursed as
required hereunder or under any such Letter of Credit, each such Revolving
Lender shall pay to the Administrative Agent for the account of the Issuing
Lender its pro rata share of such unreimbursed drawing in same day funds on the
day of notification by the Administrative Agent of an unreimbursed drawing
pursuant to the provisions of subsection (d) below. The obligation
41
of each Revolving 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. Unless the Borrower shall immediately notify the
Administrative Agent and the Issuing Lender that the Borrower intends to
otherwise reimburse the Issuing Lender for such drawing, the Borrower shall be
deemed to have requested that the Revolving Lenders make a Revolving Loan in the
amount of the drawing as provided in subsection (e) below on the related Letter
of Credit, the proceeds of which will be used to satisfy the related
reimbursement obligations. The Borrower promises to reimburse the Issuing Lender
on the day on which the Issuing Lender notifies the Borrower of a drawing under
any Letter of Credit (either with the proceeds of a Revolving Loan obtained
hereunder or deemed to have been requested hereunder or otherwise) in same day
funds provided such notice is received by the Borrower from the Issuing Lender
on or before 12:00 Noon (New York City time) (otherwise such payment shall be
made on or before 12:00 Noon (New York City time) on the Business Day next
succeeding the day such notice is received). The Borrower hereby promises to pay
to the Issuing Lender interest on the unreimbursed amount of any drawing under a
Letter of Credit at a per annum rate equal to (i) for the first two (2) Business
Days following the date of the related drawing, the Adjusted Base Rate and (ii)
thereafter, the Adjusted Base Rate plus 2%. The Borrower's reimbursement
obligations hereunder shall be absolute and unconditional under all
circumstances irrespective of any rights of setoff, counterclaim or defense to
payment the Borrower may claim or have against the Issuing Lender (other than
that the payment of such drawing by the Issuing Lender constituted gross
negligence, bad faith or willful misconduct on the part of the Issuing Lender),
the Administrative Agent, the Revolving 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 or any other Credit Party to
receive consideration or the legality, validity, regularity or unenforceability
of the Letter of Credit. The Issuing Lender will promptly notify the
Administrative Agent, who shall in turn, promptly notify the other Revolving
Lenders of the amount of any unreimbursed drawing and each Revolving 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
Revolving Lender's pro rata share of such unreimbursed drawing. Such payment
shall be made on the day such notice is received by such Revolving Lender from
the Administrative Agent if such notice is received at or before 2:00 P.M. (New
York City time), and otherwise such payment shall be made at or before 12:00
Noon (New York City time) on the Business Day next succeeding the day such
notice is received. If such Revolving Lender does not pay such amount to the
Administrative Agent for the account of the Issuing Lender in full upon such
request, such Revolving 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 Revolving Lender pays such
amount to the Administrative Agent for the account of the Issuing Lender in full
at a rate per annum equal to, if paid within two (2) Business Days of the date
that such Revolving Lender is required to make payments of such amount pursuant
to the preceding sentence, the Federal Funds Rate and thereafter at a rate equal
to the Base Rate. Each Revolving Lender's obligation to make such payment to the
Issuing Lender, and the right
42
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 Credit Agreement or the Commitments hereunder, the existence
of a Default or Event of Default or the acceleration of the obligations of the
Borrower hereunder and shall be made without any offset, abatement, withholding
or reduction whatsoever. Simultaneously with the making of each such payment by
a Revolving Lender to the Administrative Agent for the account of the Issuing
Lender, such Revolving Lender shall, automatically and without any further
action on the part of the Issuing Lender or such Revolving Lender, acquire a
Participation Interest in an amount equal to such payment (excluding the portion
of such payment constituting interest owing to the Issuing Lender) in the
related unreimbursed drawing portion of the LOC Obligation and in the interest
thereon and in the related LOC Documents, and shall have a claim against the
Borrower with respect thereto.
(e) REPAYMENT WITH REVOLVING LOANS. On any day on which the Borrower
shall have requested, or been deemed to have requested, a Revolving Loan advance
to reimburse a drawing under a Letter of Credit, the Administrative Agent shall
give notice to the Revolving Lenders that a Revolving Loan has been requested or
deemed requested by the Borrower to be made in connection with a drawing under a
Letter of Credit, in which case a Revolving Loan advance comprised of Base Rate
Loans (or Eurodollar Loans to the extent the Borrower has complied with the
procedures of Section 2.1(b)(i) with respect thereto) shall be immediately made
to the Borrower by all Revolving Lenders (notwithstanding any termination of the
Commitments pursuant to Section 9.2) pro rata based on the respective Revolving
Commitment Percentages of the Revolving Lenders (determined before giving effect
to any termination of the Commitments pursuant to Section 9.2) and the proceeds
thereof shall be paid directly to the Administrative Agent for the account of
the Issuing Lender for application to the respective LOC Obligations. Each such
Revolving Lender hereby irrevocably agrees to make its pro rata share of each
such Revolving Loan immediately upon any such request or deemed request in the
amount, in the manner and on the date specified in the preceding sentence
notwithstanding (i) the amount of such borrowing may not comply with the minimum
amount for advances of Revolving Loans otherwise required hereunder, (ii)
whether any conditions specified in Section 5.2 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 hereunder, (v) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (vi) any
termination of the Commitments relating thereto prior to or contemporaneously
with such borrowing. In the event that any Revolving Loan 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 or any other Credit Party), then each such Revolving
Lender hereby agrees that it shall forthwith purchase (as of the date such
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
Issuing Lender such Participation Interests in the outstanding LOC Obligations
as shall be necessary to cause each such Revolving Lender to share in such LOC
Obligations ratably (based upon the respective Revolving Commitment Percentages
of the Revolving Lenders (determined before giving effect to any termination of
the Commitments pursuant to Section 9.2)), provided that at the time any
purchase of Participation Interests pursuant to this sentence is actually made,
the purchasing Revolving Lender shall be required to pay to the Administrative
Agent for the account of the Issuing Lender, to the extent
43
not paid to the Issuing Lender by the Borrower in accordance with the terms of
subsection (d) above, interest on the principal amount of Participation
Interests purchased for each day from and including the day upon which such
borrowing would otherwise have occurred to but excluding the date of payment for
such Participation Interests, at the rate equal to, if paid within two (2)
Business Days of the date of the Revolving Loan advance, the Federal Funds Rate,
and thereafter at a rate equal to the Base Rate.
(f) DESIGNATION OF CONSOLIDATED PARTIES AS ACCOUNT PARTIES.
Notwithstanding anything to the contrary set forth in this Credit Agreement,
including without limitation Section 2.2(a), a Letter of Credit issued hereunder
may contain a statement to the effect that such Letter of Credit is issued for
the account of any Subsidiary of the Borrower, provided that notwithstanding
such statement, the Borrower shall be the actual account party for all purposes
of this Credit Agreement for such Letter of Credit and such statement shall not
affect the Borrower's reimbursement obligations hereunder with respect to such
Letter of Credit.
(g) RENEWAL, EXTENSION. The renewal or extension of 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.
(h) UNIFORM CUSTOMS AND PRACTICES. The Issuing Lender may have the
Letters of Credit be subject to The Uniform Customs and Practice for Documentary
Credits (the "UCP") or the International Standby Practices 1998 (the "ISP98"),
in either case as published as of the date of issue by the International Chamber
of Commerce, in which case the UCP or the ISP98, as applicable, may be
incorporated therein and deemed in all respects to be a part thereof.
(i) INDEMNIFICATION; NATURE OF ISSUING LENDER'S DUTIES.
(i) In addition to its other obligations under this Section
2.2, the Borrower hereby agrees to pay, and protect, indemnify and save
each Lender harmless from and against, any and all claims, demands,
liabilities, damages, actual losses, costs, charges and reasonable
expenses (including reasonable attorneys' fees) that such Lender may
incur or be subject to as a consequence, direct or indirect, of (A) the
issuance of any Letter of Credit or (B) the failure of such 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").
(ii) As between the Borrower and the Lenders (including the
Issuing Lender), the Borrower shall assume all risks of the acts,
omissions or misuse of any Letter of Credit by the beneficiary thereof.
No Lender (including the Issuing Lender) shall be responsible: (A) 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; (B) 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
44
in part, that may prove to be invalid or ineffective for any reason;
(C) for errors, omissions, interruptions or delays in transmission or
delivery of any messages, by mail, cable, telegraph, telex or
otherwise, whether or not they be in cipher; (D) 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
(E) for any consequences arising from causes beyond the control of such
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.
(iii) In furtherance and extension and not in limitation of
the specific provisions hereinabove set forth, any action taken or
omitted by any Lender (including the Issuing Lender), under or in
connection with any Letter of Credit or the related certificates, if
taken or omitted in good faith and without gross negligence, shall not
put such Lender under any resulting liability to the Borrower or any
other Credit Party. It is the intention of the parties that this Credit
Agreement shall be construed and applied to protect and indemnify each
Lender (including 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 (on behalf of itself and each of the
other Credit Parties), including, without limitation, any and all
Government Acts. No Lender (including the Issuing Lender) shall, in any
way, be liable for any failure by such 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 such Lender.
(iv) Nothing in this subsection (i) is intended to limit the
reimbursement obligations of the Borrower contained in subsection (d)
above. The obligations of the Borrower under this subsection (i) shall
survive the termination of this Credit Agreement. No act or omission of
any current or prior beneficiary of a Letter of Credit shall in any way
affect or impair the rights of the Lenders (including the Issuing
Lender) to enforce any right, power or benefit under this Credit
Agreement.
(v) Notwithstanding anything to the contrary contained in this
Section 2.2(i), no Credit Party shall have any obligation to indemnify
or reimburse any Lender (including the Issuing Lender) in respect of
any liability incurred by such Lender (A) arising out of the gross
negligence, bad faith or willful misconduct of such Lender, or (B)
caused by such Lender's failure to pay under any Letter of Credit after
presentation to it of a request strictly complying with the terms and
conditions of such Letter of Credit unless such payment is prohibited
by any law, regulation, court order or decree.
(j) RESPONSIBILITY OF ISSUING LENDER. It is expressly understood and
agreed that the obligations of the Issuing Lender hereunder to the Lenders are
only those expressly set forth in this Credit Agreement and that the Issuing
Lender shall be entitled to assume that the conditions precedent set forth in
Section 5.2 have been satisfied unless it shall have acquired actual knowledge
that any such condition precedent has not been satisfied; provided, however,
that nothing set forth in this Section 2.2 shall be deemed to prejudice the
right of any Lender to recover from the Issuing Lender any amounts made
available by such Lender to the Issuing Lender pursuant to this Section 2.2 in
the event that it is determined by a
45
court of competent jurisdiction that the payment with respect to a Letter of
Credit constituted gross negligence, bad faith or willful misconduct on the part
of the Issuing Lender.
(k) CONFLICT WITH LOC DOCUMENTS. In the event of any conflict between
this Credit Agreement and any LOC Document (including any letter of credit
application), this Credit Agreement shall control.
2.3. SWINGLINE LOAN SUBFACILITY.
(a) SWINGLINE COMMITMENT. Subject to the terms and conditions hereof
and in reliance upon the representations and warranties set forth herein, the
Swingline Lender, in its individual capacity, agrees to make certain revolving
credit loans requested by the Borrower in Dollars to the Borrower (each a
"SWINGLINE LOAN" and, collectively, the "SWINGLINE LOANS") from time to time
from the Closing Date until the Maturity Date for the purposes hereinafter set
forth; provided, however, (i) the aggregate principal amount of Swingline Loans
outstanding at any time shall not exceed TWENTY MILLION DOLLARS ($20,000,000)
(the "SWINGLINE COMMITTED AMOUNT"), and (ii) the sum of the aggregate
outstanding principal amount of Revolving Loans plus LOC Obligations plus
Swingline Loans shall not exceed the Revolving Committed Amount. Swingline Loans
hereunder shall be made as Base Rate Loans or Quoted Rate Swingline Loans as the
Borrower may request in accordance with the provisions of this Section 2.3 and
may be repaid and reborrowed in accordance with the provisions hereof.
(b) SWINGLINE LOAN ADVANCES.
(i) NOTICES; DISBURSEMENT. Whenever the Borrower desires a
Swingline Loan advance hereunder it shall give written notice from an
Executive Officer of the Borrower (or telephonic notice promptly
confirmed in writing) to the Swingline Lender not later than 1:00 P.M.
(New York City time) on the Business Day of the requested Swingline
Loan advance. Each such notice shall be irrevocable and shall specify
(A) that a Swingline Loan advance is requested, (B) the date of the
requested Swingline Loan advance (which shall be a Business Day) and
(C) the principal amount of the Swingline Loan advance requested. Each
Swingline Loan shall be made as a Base Rate Loan or a Quoted Rate
Swingline Loan and shall have such maturity date as the Swingline
Lender and the Borrower shall agree upon receipt by the Swingline
Lender of any such notice from the Borrower. The Swingline Lender shall
initiate the transfer of funds representing the Swingline Loan advance
to the Borrower by 3:00 P.M. (New York City time) on the Business Day
of the requested borrowing.
(ii) MINIMUM AMOUNTS. Each Swingline Loan advance shall be in
integral multiples of $100,000 (or the remaining amount of the
Swingline Committed Amount, if less).
(iii) REPAYMENT OF SWINGLINE LOANS. The Borrower hereby
promises to pay the outstanding principal amount of each Swingline Loan
on the earlier of (A) the Maturity Date or (B) the first date after
such Swingline Loan is made that is the 15th or the last day of a
calendar month and is at least three Business days after such
46
Swingline Loan is made. The Swingline Lender may, at any time, in its
sole discretion, by written notice to the Borrower and the Revolving
Lenders, demand repayment of its Swingline Loans by way of a Revolving
Loan advance, in which case the Borrower shall be deemed to have
requested a Revolving Loan advance comprised solely of Base Rate Loans
in the amount of such Swingline Loans; provided, however, that any such
demand shall be deemed to have been given one Business Day prior to the
Maturity Date and on the date of the occurrence of any Event of Default
described in Section 9.1 and upon acceleration of the indebtedness
hereunder and the exercise of remedies in accordance with the
provisions of Section 9.2. Each Revolving Lender hereby irrevocably
agrees to make its pro rata share of each such Revolving Loan in the
amount, in the manner and on the date specified in the preceding
sentence notwithstanding (I) the amount of such borrowing may not
comply with the minimum amount for advances of Revolving Loans
otherwise required hereunder, (II) whether any conditions specified in
Section 5.2 are then satisfied, (III) whether a Default or an Event of
Default then exists, (IV) failure of any such request or deemed request
for a Revolving Loan to be made by the time otherwise required
hereunder, (V) whether the date of such borrowing is a date on which
Revolving Loans are otherwise permitted to be made hereunder or (VI)
any termination of the Commitments relating thereto prior to or
contemporaneously with such borrowing. In the event that any Revolving
Loan 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 or
any other Credit Party), then each Revolving Lender hereby agrees that
it shall forthwith purchase (as of the date such 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 Participation Interests in the outstanding
Swingline Loans as shall be necessary to cause each such Revolving
Lender to share in such Swingline Loans ratably based upon its
Revolving Commitment Percentage of the Revolving Committed Amount
(determined before giving effect to any termination of the Commitments
pursuant to Section 3.4), 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 Interest
is purchased and (B) at the time any purchase of Participation
Interests pursuant to this sentence is actually made, the purchasing
Revolving Lender shall be required to pay to the Swingline Lender, to
the extent not paid to the Swingline Lender by the Borrower in
accordance with the terms of subsection (c)(ii) below, interest on the
principal amount of Participation Interests purchased for each day from
and including the day upon which such borrowing would otherwise have
occurred to but excluding the date of payment for such Participation
Interests, at the rate equal to, if paid within two (2) Business Days
of the date upon which such borrowing would otherwise have occurred,
the Federal Funds Rate, and thereafter at a rate equal to the Adjusted
Base Rate.
(c) INTEREST ON SWINGLINE LOANS.
(i) RATE OF INTEREST. Subject to the provisions of Section
3.1, each Swingline Loan shall bear interest as follows:
47
(A) BASE RATE LOANS. If such Swingline Loan is a Base
Rate Loan, at a per annum rate equal to the Adjusted
Base Rate.
(B) QUOTED RATE SWINGLINE LOANS. If such Swingline Loan
is a Quoted Rate Swingline Loan, at a per annum rate
equal to the Quoted Rate applicable thereto.
(ii) PAYMENT OF INTEREST. The Borrower hereby promises to pay
interest on Swingline Loans in arrears on each applicable Interest
Payment Date (or at such other times as may be specified herein).
Notwithstanding any other provision to the contrary set forth in this
Credit Agreement, in the event that the principal amount of any Quoted
Rate Swingline Loan is not repaid on the last day of the Interest
Period for such Loan, then such Loan shall be automatically converted
into a Base Rate Loan at the end of such Interest Period.
(d) SWINGLINE NOTE. The Borrower hereby agrees that, upon the request
to the Administrative Agent by the Swingline Lender, the Borrower will execute
and deliver to the Swingline Lender a promissory note evidencing the Swingline
Loans of the Swingline Lender, substantially in the form of Exhibit 2.3(d), with
appropriate insertions as to date and principal amount (a "SWINGLINE NOTE").
2.4. [INTENTIONALLY DELETED].
2.5. TRANCHE B TERM LOAN.
(a) TRANCHE B TERM COMMITMENT. 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 Tranche B Term Loan Percentage of a term loan in Dollars (the
"TRANCHE B TERM LOAN") in the aggregate principal amount of TWO HUNDRED SEVENTY
MILLION DOLLARS ($270,000,000) (the "TRANCHE B TERM LOAN COMMITTED AMOUNT"). The
full principal amount of the Tranche B Term Loan shall be disbursed on the
Closing Date as a Base Rate Loan. Thereafter, the Tranche B Term Loan may
consist of Base Rate Loans or Eurodollar Loans, or a combination thereof, as the
Borrower may request; provided, however, that no more than 15 Eurodollar Loans
shall be outstanding hereunder at any time (it being understood that, for
purposes hereof, Eurodollar Loans with different Interest Periods shall be
considered as separate Eurodollar Loans, even if they begin on the same date,
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 Eurodollar Loan with a single Interest Period). Amounts repaid
on the Tranche B Term Loan may not be reborrowed.
(b) BORROWING PROCEDURES. The Borrower shall submit an appropriate
Notice of Borrowing for the Tranche B Term Loan to the Administrative Agent not
later than 11:00 A.M. (New York City time) on the Closing Date. Such Notice of
Borrowing shall be irrevocable and shall specify (i) that the funding of the
Tranche B Term Loan is requested and (ii) that the funding of the Tranche B Term
Loan shall be comprised of Base Rate
48
Loans. Each Lender shall make its Tranche B Term Loan Percentage of the Tranche
B Term Loan available to the Administrative Agent for the account of the
Borrower at the office of the Administrative Agent specified in Schedule 2.1(a),
or at such other office as the Administrative Agent may designate in writing, by
1:00 P.M. (New York City time) on the Closing Date in Dollars and in funds
immediately available to the Administrative Agent.
(c) MINIMUM AMOUNTS. Each Eurodollar Loan or Base Rate Loan that is
part of the Tranche B Term Loan shall be in an aggregate principal amount that
is not less than $2,000,000 and integral multiples of $100,000 (or the then
remaining principal balance of the Tranche B Term Loan).
(d) REPAYMENT OF TRANCHE B TERM LOAN. The Borrower hereby promises to
pay the outstanding principal amount of the Tranche B Term Loan in twenty-four
(24) consecutive quarterly installments as follows (as such installments may
hereafter be adjusted as a result of prepayments made pursuant to Section 3.3),
unless accelerated sooner pursuant to Section 9.2:
TRANCHE B TERM LOAN
PRINCIPAL
PRINCIPAL AMORTIZATION AMORTIZATION
PAYMENT DATES PAYMENT
----------------------------------------------------------------- -------------------
December 31, 2002, March 31, 2003, June 30, 2003, September 30,
2003, December 31, 2003, March 31, 2004, June 30, 2004,
September 30, 2004, December 31, 2004, March 31, 2005, June 30,
2005, September 30, 2005, December 31, 2005, March 31, 2006,
June 30, 2006, September 30, 2006, December 31, 2006, March 31,
2007, June 30, 2007, and September 30, 2007..................... $ 675,000
December 31, 2007, March 31, 2008, June 30, 2008 and the Maturity
Date............................................................ $64,125,000
(e) INTEREST. Subject to the provisions of Section 3.1, the outstanding
Tranche B Term Loan shall bear interest at a per annum rate equal to:
(i) BASE RATE LOANS. During such periods as the Tranche B Term
Loan shall be comprised in whole or in part of Base Rate Loans, such
Base Rate Loans shall bear interest at a per annum rate equal to the
Adjusted Base Rate.
(ii) EURODOLLAR LOANS. During such periods as the Tranche B
Term Loan shall be comprised in whole or in part of Eurodollar Loans,
such Eurodollar Loans shall bear interest at a per annum rate equal to
the Adjusted Eurodollar Rate.
The Borrower hereby promises to pay interest on the Tranche B Term Loan in
arrears on each applicable Interest Payment Date (or at such other times as may
be specified herein).
(f) TRANCHE B TERM NOTES. The Borrower hereby agrees that, upon the
request to the Administrative Agent by any Lender, the Borrower will execute and
deliver to
49
such Lender a promissory note evidencing the Tranche B Term Loan of such Lender,
substantially in the form of Exhibit 2.5(f), with appropriate insertions as to
date and principal amount (a "TRANCHE B TERM NOTE").
SECTION III
OTHER PROVISIONS RELATING TO CREDIT FACILITIES
3.1. DEFAULT RATE.
Upon the occurrence, and during the continuance, of a default in the
payment of any amount hereunder or under any of the other Credit Documents, such
overdue amount shall bear interest, payable on demand, at a per annum rate 2%
greater than the rate which would otherwise be applicable (or if no rate is
applicable, whether in respect of interest, fees or other amounts, then the
Adjusted Base Rate plus 2%).
3.2. EXTENSION AND CONVERSION.
The Borrower shall have the option, on any Business Day, to extend
existing Loans into a subsequent permissible Interest Period or to convert Loans
into Loans of another interest rate type; provided, however, that (i) except as
provided in Section 3.8, Eurodollar Loans may be converted into Base Rate Loans
or extended as Eurodollar Loans for new Interest Periods only on the last day of
the Interest Period applicable thereto unless the Borrower makes payment of any
amounts then due and owing pursuant to Section 3.12, (ii) Loans extended as, or
converted into, Eurodollar Loans shall be subject to the terms of the definition
of "INTEREST PERIOD" set forth in Section 1.1 and shall be in such minimum
amounts as provided in, with respect to Revolving Loans, Section 2.1(b)(ii), or,
with respect to the Tranche B Term Loan, Section 2.5(c), (iii) no more than 15
Eurodollar Loans shall be outstanding hereunder at any time (it being understood
that, for purposes hereof, Eurodollar Loans with different Interest Periods
shall be considered as separate Eurodollar Loans, even if they begin on the same
date, 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 Eurodollar Loan with a single Interest Period), (iv) any
request for extension or conversion of a Eurodollar Loan which shall fail to
specify an Interest Period shall be deemed to be a request for an Interest
Period of one month and (v) Swingline Loans may not be extended or converted
pursuant to this Section 3.2. Each such extension or conversion shall be
effected by the Borrower by giving a Notice of Extension/Conversion (or
telephonic notice promptly confirmed in writing) to the office of the
Administrative Agent specified in Schedule 2.1(a), or at such other office as
the Administrative Agent may designate in writing, prior to 11:00 A.M. (New York
City time) on the Business Day of, in the case of the conversion of a Eurodollar
Loan into a Base Rate Loan, and on the third Business Day prior to, in the case
of the extension of a Eurodollar Loan as, or conversion of a Base Rate Loan
into, a Eurodollar Loan, the date of the proposed extension or conversion,
specifying the date of the proposed extension or conversion, the Loans to be so
extended or converted, the types of Loans into which such Loans are to be
converted and, if appropriate, the applicable Interest Periods with respect
thereto. In the event the Borrower fails to request
50
extension or conversion of any Eurodollar Loan in accordance with this Section
3.2, or any such conversion or extension is not permitted or required by this
Section 3.2, then such Eurodollar Loan shall be automatically converted into a
Base Rate Loan at the end of the Interest Period applicable thereto. The
Administrative Agent shall give each Lender notice as promptly as practicable of
any such proposed extension or conversion affecting any Loan.
3.3. PREPAYMENTS.
(a) VOLUNTARY PREPAYMENTS. The Borrower shall have the right to prepay
Loans in whole or in part from time to time upon providing at least three (3)
Business Days' notice to the Administrative Agent (which notice may be waived by
the Administrative Agent) other than in connection with Revolving Loans;
provided, however, that each partial prepayment of Loans (other than Swingline
Loans) shall be in a minimum principal amount of $2,000,000 (or $500,000 in the
case of Revolving Loans) and integral multiples of $100,000 in excess thereof
(or the then remaining principal balance of the Revolving Loans or the Tranche B
Term Loan, as applicable, if less). Subject to the foregoing terms, amounts
prepaid under this Section 3.3(a) shall be applied as the Borrower may elect;
provided that if the Borrower shall fail to specify with respect to any
voluntary prepayment, such voluntary prepayment shall be applied first to
Swingline Loans, then Revolving Loans and then to the Tranche B Term Loan (and
applied to the remaining Principal Amortization Payments ratably), in each case
first to Base Rate Loans and then to Eurodollar Loans in direct order of
Interest Period maturities. All prepayments under this Section 3.3(a) shall be
subject to Section 3.12, but otherwise without premium or penalty, and, in the
case of Eurodollar Loans, shall be accompanied by interest on the principal
amount prepaid through the date of prepayment.
(b) MANDATORY PREPAYMENTS.
(i) (A) REVOLVING COMMITTED AMOUNT. If at any time, the sum of
the aggregate outstanding principal amount of Revolving Loans plus LOC
Obligations plus Swingline Loans 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.
(B) LOC COMMITTED AMOUNT. If at any time, the sum of the
aggregate principal amount of LOC Obligations shall exceed the LOC
Committed Amount, the Borrower immediately shall cash collateralize the
LOC Obligations in an amount sufficient to eliminate such excess.
(ii) EXCESS CASH FLOW. Within 105 days after the end of each
fiscal year (commencing with the fiscal year ending June 30, 2003), the
Borrower shall prepay the Loans in an amount equal to (A) 50% (if the
Consolidated Leverage Ratio as of the end of such fiscal year is equal
to or greater than 3.50 to 1.00) or 25% (if the Consolidated Leverage
Ratio as of the end of such fiscal year is less than 3.50 to 1.00 but
equal to or greater than 3.00 to 1.00) of Excess Cash Flow for such
fiscal year minus (B) the amount of any voluntary prepayments made
during such fiscal year of the Tranche B Term Loan or (to the extent
accompanied by a permanent reduction in the
51
Revolving Committed Amount) the Revolving Loans (such prepayment to be
applied as set forth in clause (vi) below).
(iii) (A) ASSET DISPOSITIONS. Immediately upon the occurrence
of any Asset Disposition Prepayment Event or a Discontinued Operations
Sale, the Borrower shall prepay the Loans in an aggregate amount equal
to 100% of the Net Cash Proceeds of such Asset Disposition or
Discontinued Operation Sale not applied (or caused to be applied) by
the Credit Parties during the related Application Period to make
Eligible Reinvestments (in each case, such prepayment to be applied as
set forth in clause (vi) below).
(B) INVOLUNTARY DISPOSITIONS. Immediately upon the occurrence
of an Involuntary Disposition Prepayment Event, the Borrower shall
prepay the Loans in an aggregate amount equal to 100% of the Excess
Proceeds (such prepayment to be applied as set forth in clause (vi)
below).
(iv) DEBT ISSUANCES. Immediately upon the occurrence of a Debt
Issuance Prepayment Event, the Borrower shall prepay the Loans in an
aggregate amount equal to 100% of the Net Cash Proceeds of the related
Debt Issuance (such prepayment to be applied as set forth in clause
(vi) below).
(v) EQUITY ISSUANCES. Immediately upon the occurrence of an
Equity Issuance Prepayment Event, the Borrower shall prepay the Loans
in an aggregate amount equal to the lesser of (A) 50% of the Net Cash
Proceeds of the related Equity Issuance or (B) except in the case of a
Qualifying IPO, the Net Cash Proceeds not applied to make Eligible
Reinvestments during the Application Period (such prepayment to be
applied as set forth in clause (vi) below); provided that 100% of the
Net Cash Proceeds of the issuance of any Qualified Preferred Stock
pursuant to Section 8.1(p) shall be applied to repayment of the Loans
as set forth in clause (vi) below upon receipt thereof.
(vi) APPLICATION OF MANDATORY PREPAYMENTS. All amounts
required to be paid pursuant to this Section 3.3(b) shall be applied as
follows: (A) with respect to all amounts prepaid pursuant to Section
3.3(b)(i)(A), to Revolving Loans and (after all Revolving Loans have
been repaid) to a cash collateral account in respect of LOC
Obligations, (B) with respect to all amounts prepaid pursuant to
Section 3.3(b)(i)(B), to a cash collateral account in respect of LOC
Obligations, (C) with respect to all amounts prepaid pursuant to
Section 3.3(b)(ii), as the Borrower may elect, and (D) with respect to
all amounts prepaid pursuant to Section 3.3(b)(iii), 3.3(b)(iv) and
3.3(b)(v), FIRST, to the Tranche B Term Loans (with such prepayment
being applied ratably to the remaining Principal Amortization Payments
thereof) and SECOND, to the Revolving Loans and (after all Revolving
Loans have been repaid) to a cash collateral account in respect of LOC
Obligations (without any reduction in the Revolving Committed Amount).
Within the parameters of the applications set forth above, prepayments
shall be applied first to Base Rate Loans and then to Eurodollar Loans
in direct order of Interest Period maturities. All prepayments under
this Section 3.3(b) shall be subject to Section 3.12, but otherwise
without premium or penalty, and shall, in the
52
case of Eurodollar Loans, be accompanied by interest on the principal
amount prepaid through the date of prepayment.
(vii) PREPAYMENT ACCOUNT. If the Borrower is required to make
a mandatory prepayment of Eurodollar Loans under this Section 3.3(b),
the Borrower shall have the right, in lieu of making such prepayment in
full, to deposit an amount equal to such mandatory prepayment with the
Administrative Agent in a cash collateral account maintained (pursuant
to documentation reasonably satisfactory to the Administrative Agent)
by and in the sole dominion and control of the Administrative Agent.
Any amounts so deposited shall be held by the Administrative Agent as
collateral for the prepayment of such Eurodollar Loans and shall be
applied to the prepayment of the applicable Eurodollar Loans at the end
of the current Interest Periods applicable thereto or, subject to the
terms of Section 3.12, as earlier requested in writing by the Borrower.
At the request of the Borrower, amounts so deposited shall be invested
by the Administrative Agent in Cash Equivalents maturing prior to the
date or dates on which it is anticipated that such amounts will be
applied to prepay such Eurodollar Loans; any interest earned on such
Cash Equivalents will be for the account of the Borrower and the
Borrower will deposit with the Administrative Agent the amount of any
loss on any such Cash Equivalents to the extent necessary in order that
the amount of the prepayment to be made with the deposited amounts may
not be reduced.
(viii) NOTICE OF MANDATORY PREPAYMENTS. The Borrower agrees to
use reasonable efforts to notify the Administrative Agent of any
mandatory prepayments of the Loans required to be made pursuant to this
Section 3.3(b).
3.4. TERMINATION AND REDUCTION OF REVOLVING COMMITTED AMOUNT.
(a) VOLUNTARY REDUCTIONS. The Borrower may from time to time
permanently reduce or terminate the Revolving Committed Amount in whole or in
part (in minimum aggregate amounts of $2,500,000 or in integral multiples of
$100,000 in excess thereof (or, if less, the full remaining amount of the then
applicable Revolving Committed Amount)) upon five Business Days' prior written
notice to the Administrative Agent; provided, however, no such termination or
reduction shall be made which would cause the sum of the aggregate outstanding
principal amount of Revolving Loans plus LOC Obligations plus Swingline Loans to
exceed the Revolving Committed Amount, unless, concurrently with such
termination or reduction, the Revolving Loans are repaid to the extent necessary
to eliminate such excess. The Administrative Agent shall promptly notify each
affected Lender of receipt by the Administrative Agent of any notice from the
Borrower pursuant to this Section 3.4(a).
(b) TERM LOAN COMMITMENTS. The Tranche B Term Loan Commitment of each
Lender, if any, shall automatically terminate at such time as such Lender shall
have made available to the Borrower such Lender's share of the Tranche B Term
Loan.
(c) MANDATORY REDUCTIONS. The Revolving Committed Amount and the
Swingline Committed Amount automatically shall be permanently reduced from time
to time in accordance with the terms of Section 3.3(b)(vi).
53
(d) MATURITY DATE. Unless terminated sooner pursuant to Section 3.4(a)
or Section 9.2, the Revolving Commitments of the Lenders and the LOC Commitment
of the Issuing Lender shall automatically terminate on the Maturity Date.
(e) GENERAL. The Borrower shall pay to the Administrative Agent for the
account of the Lenders (except to the extent that any Lender was a Defaulting
Lender during the applicable period in which such fee accrued) in accordance
with the terms of Section 3.5(a), on the date of each termination or reduction
of the Revolving Committed Amount, the Unused Fee accrued through the date of
such termination or reduction on the amount of the Revolving Committed Amount so
terminated or reduced.
3.5. FEES.
(a) UNUSED FEE. In consideration of the Revolving Commitments of the
Lenders hereunder, the Borrower hereby promises to pay to the Administrative
Agent for the account of each Lender (except to the extent that any Lender was a
Defaulting Lender during the applicable period in which such fee accrued) a fee
(the "UNUSED FEE") on the Unused Revolving Committed Amount computed at a per
annum rate for each day during the applicable Unused Fee Calculation Period
(hereinafter defined) at a rate equal to the Applicable Percentage in effect
from time to time. The Unused Fee shall commence to accrue on the Closing Date
and shall be due and payable in arrears on the last Business Day of each March,
June, September and December (and on any date that the Revolving Committed
Amount is reduced pursuant to Section 3.4(a) and on the Maturity Date) for the
immediately preceding quarter (or portion thereof) (each such quarter or portion
thereof for which the Unused Fee is payable hereunder being herein referred to
as an "UNUSED FEE CALCULATION PERIOD"), beginning with the first of such dates
to occur after the Closing Date.
(b) LETTER OF CREDIT FEES.
(i) STANDBY LETTER OF CREDIT ISSUANCE FEE. In consideration of
the issuance of standby Letters of Credit hereunder, the Borrower
hereby promises to pay to the Administrative Agent for the account of
each Lender (except to the extent that any Lender was a Defaulting
Lender during the applicable period in which such fee accrued) a fee
(the "STANDBY LETTER OF CREDIT FEE") on such Lender's Revolving
Commitment Percentage of the average daily maximum amount available to
be drawn under each such standby Letter of Credit computed at a per
annum rate for each day from the date of issuance to the date of
expiration equal to the Applicable Percentage. The Standby Letter of
Credit Fee will be payable quarterly in arrears on the last Business
Day of each March, June, September and December for the immediately
preceding quarter (or a portion thereof) and on the Maturity Date for
the Revolving Commitments.
(ii) TRADE LETTER OF CREDIT DRAWING FEE. In consideration of
the issuance of trade Letters of Credit hereunder, the Borrower hereby
promises to pay to the Administrative Agent for the account of each
Lender (except to the extent that any Lender was a Defaulting Lender
during the applicable period in which such fee accrued) a fee (the
"TRADE LETTER OF CREDIT FEE") on such Lender's Revolving Commitment
Percentage of the average daily maximum amount available to be drawn
54
under each such trade Letter of Credit computed at a per annum rate for
each day from the date of issuance to the date of expiration equal to
1.25%. The Trade Letter of Credit Fee will be payable quarterly in
arrears on the last Business Day of each March, June, September and
December for the immediately preceding quarter (or a portion thereof)
and on the Maturity Date for the Revolving Commitments.
(iii) ISSUING LENDER FEES. In addition to the Standby Letter
of Credit Fee payable pursuant to clause (i) above and the Trade Letter
of Credit Fee payable pursuant to clause (ii) above, the Borrower
hereby promises to pay to the Administrative Agent for the account of
the Issuing Lender without sharing by the other Lenders (i) a letter of
credit fronting fee of 0.125% on the average daily maximum amount
available to be drawn under each Letter of Credit computed at a per
annum rate for each day from the date of issuance to the date of
expiration (which fronting fee shall be payable quarterly in arrears on
the last Business Day of each March, June, September and December for
the immediately preceding quarter (or a portion thereof)) and on the
Maturity Date for the Revolving Commitments and (ii) the customary
charges from time to time of the Issuing Lender with respect to the
issuance, amendment, transfer, administration, cancellation and
conversion of, and drawings under, such Letters of Credit.
(c) ADMINISTRATIVE AGENT'S FEES. The Borrower hereby (i) absolutely
accepts and assumes all of the duties, obligations and liabilities of the
Sponsor in, to and under the Administrative Agent's Fee Letter to the same
extent as if the Borrower had executed the Administrative Agent's Fee Letter and
(ii) promises to pay to the Administrative Agent, for its own account and for
the account of JPMorgan Securities Inc., as applicable, the fees referred to in
the Administrative Agent's Fee Letter.
3.6. CAPITAL ADEQUACY.
(a) If any Lender has determined, after the date hereof, that the
adoption or the becoming effective of, or any change in, or any change by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof in the interpretation or administration
of, any applicable law, rule or regulation regarding capital adequacy, or
compliance by such Lender with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or would have the effect of reducing the rate of
return on such Lender's capital or assets as a consequence of its commitments or
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, effectiveness, change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy) by an
amount deemed by such Lender to be material, then, upon notice from such Lender
through the Administrative Agent to the Borrower setting forth in reasonable
detail the charge and the calculation of such reduced rate of return to the
Borrower, the Borrower shall be obligated to pay to such Lender such additional
amount or amounts as will compensate such Lender for such reduction to the
extent that such Lender reasonably determines that such additional amount is
allocable to the existence of such Lender's commitments or obligations
hereunder. Each determination by any such Lender of amounts owing under this
Section shall, absent demonstrable error, be conclusive and binding on the
parties hereto.
55
(b ) The Borrower shall not be required to compensate a Lender pursuant
to this Section 3.6 for any additional amounts incurred more than 180 days prior
to the date that such Lender notifies the Borrower of the change of law giving
rise to such additional amounts and of such Lender's intention to claim
compensation therefor; provided that, if the change of law giving rise to such
additional amounts is retroactive, then such 180-day period referred to above
shall be extended to include the period of retroactive effect thereof.
3.7. LIMITATION ON EURODOLLAR LOANS. If on or prior to the first day of
any Interest Period for any Eurodollar Loan:
(a) the Administrative Agent determines (which determination shall be
conclusive) that by reason of circumstances affecting the relevant market,
adequate and reasonable means do not exist for ascertaining the Eurodollar Rate
for such Interest Period; or
(b) the Required Lenders determine (which determination shall be
conclusive) and notify the Administrative Agent that the Eurodollar Rate will
not adequately and fairly reflect the cost to the Lenders of funding Eurodollar
Loans for such Interest Period;
then the Administrative Agent shall give the Borrower prompt notice thereof, and
so long as such condition remains in effect, the Lenders shall be under no
obligation to make additional Eurodollar Loans, Continue Eurodollar Loans, or to
Convert Base Rate Loans into Eurodollar Loans and the Borrower shall, on the
last day(s) of the then current Interest Period(s) for the outstanding
Eurodollar Loans, either prepay such Eurodollar Loans or Convert such Eurodollar
Loans into Base Rate Loans in accordance with the terms of this Credit
Agreement. The Administrative Agent or the Required Lenders, as the case may be,
will withdraw such determination pursuant to this Section promptly as
circumstances allow.
3.8. ILLEGALITY.
Notwithstanding any other provision of this Credit Agreement, in the
event that it becomes unlawful for any Lender or its Applicable Lending Office
to make, maintain, or fund Eurodollar Loans hereunder, then such Lender shall
promptly notify the Borrower thereof and such Lender's obligation to make or
Continue Eurodollar Loans and to Convert Base Rate Loans into Eurodollar Loans
shall be suspended until such time as such Lender may again make, maintain, and
fund Eurodollar Loans (in which case the provisions of Section 3.10 shall be
applicable). Each Lender will designate a different Applicable Lending Office if
such designation will permit such Lender to continue to make, maintain, or fund
Eurodollar Loans hereunder and will not, in the judgment of such Lender, be
otherwise materially disadvantageous to it.
3.9. REQUIREMENTS OF LAW.
(a) If, after the date hereof, the adoption of any applicable law,
rule, or regulation, or any change in any applicable law, rule, or regulation,
or any change in the interpretation or administration thereof by any
Governmental Authority, central bank, or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender (or its
Applicable Lending Office) with any request or directive (whether or not
56
having the force of law) of any such Governmental Authority, central bank, or
comparable agency:
(i) shall subject such Lender (or its Applicable Lending
Office) to any tax, duty, or other charge with respect to any
Eurodollar Loans or its obligation to make Eurodollar Loans, or change
the basis of taxation of any amounts payable to such Lender (or its
Applicable Lending Office) under this Credit Agreement in respect of
any Eurodollar Loans (other than Taxes and taxes imposed on the overall
net income of such Lender by the jurisdiction in which such Lender has
its principal office or such Applicable Lending Office);
(ii) shall impose, modify, or deem applicable any reserve,
special deposit, assessment, or similar requirement (other than the
Eurodollar Reserve Requirement utilized in the determination of the
Adjusted Eurodollar Rate) relating to any extensions of credit or other
assets of, or any deposits with or other liabilities or commitments of,
such Lender (or its Applicable Lending Office), including the
Commitment of such Lender hereunder; or
(iii) shall impose on such Lender (or its Applicable Lending
Office) or the London interbank market any other condition affecting
this Credit Agreement or any of such extensions of credit or
liabilities or commitments;
and the result of any of the foregoing is to increase, by an amount deemed by
such Lender (or its Applicable Lending Office) to be material, the cost to such
Lender (or its Applicable Lending Office) of making, Converting into,
Continuing, or maintaining any Eurodollar Loans or to reduce any sum received or
receivable by such Lender (or its Applicable Lending Office) under this Credit
Agreement with respect to any Eurodollar Loans, then the Borrower shall pay to
such Lender on demand such amount or amounts as will compensate such Lender for
such increased cost or reduction. If any Lender requests compensation by the
Borrower under this Section 3.9, the Borrower may, by notice to such Lender
(with a copy to the Administrative Agent), suspend the obligation of such Lender
to make or Continue Eurodollar Loans, or to Convert Base Rate Loans into
Eurodollar Loans, until the event or condition giving rise to such request
ceases to be in effect (in which case the provisions of Section 3.10 shall be
applicable); provided that such suspension shall not affect the right of such
Lender to receive the compensation so requested. Each Lender shall promptly
notify the Borrower and the Administrative Agent of any event of which it has
knowledge, occurring after the date hereof, which will entitle such Lender to
compensation pursuant to this Section 3.9 and will designate a different
Applicable Lending Office if such designation will avoid the need for, or reduce
the amount of, such compensation and will not, in the judgment of such Lender,
be otherwise materially disadvantageous to it. Any Lender claiming compensation
under this Section 3.9 shall furnish to the Borrower and the Administrative
Agent a statement setting forth in reasonable detail the additional amount or
amounts to be paid to it hereunder which shall be conclusive in the absence of
demonstrable error. In determining such amount, such Lender may use any
reasonable averaging and attribution methods.
(b) The Borrower shall not be required to compensate a Lender pursuant
to this Section 3.9 for any increased costs or reductions incurred more than 180
days prior to the
57
date that such Lender notifies the Borrower of the change of law giving rise to
such increased costs or reductions and of such Lender's intention to claim
compensation therefor; provided that, if the change of law giving rise to such
increased costs or reductions is retroactive, then such 180-day period referred
to above shall be extended to include the period of retroactive effect thereof.
3.10. TREATMENT OF AFFECTED LOANS.
If the obligation of any Lender to make any Eurodollar Loan or to
Continue, or to Convert Base Rate Loans into, Eurodollar Loans shall be
suspended pursuant to Section 3.7, 3.8 or 3.9 hereof, such Lender's Eurodollar
Loans shall be automatically Converted into Base Rate Loans on the last day(s)
of the then current Interest Period(s) for such Eurodollar Loans (or, in the
case of a Conversion required by Section 3.8, on such earlier date as required
by law as such Lender may specify to the Borrower with a copy to the
Administrative Agent) and, unless and until such Lender gives notice as provided
below that the circumstances specified in Section 3.7, 3.8 or 3.9 hereof that
gave rise to such Conversion no longer exist:
(a) to the extent that such Lender's Eurodollar Loans have been so
Converted, all payments and prepayments of principal that would otherwise be
applied to such Lender's Eurodollar Loans shall be applied instead to its Base
Rate Loans; and
(b) all Loans that would otherwise be made or Continued by such Lender
as Eurodollar Loans shall be made or Continued instead as Base Rate Loans, and
all Base Rate Loans of such Lender that would otherwise be Converted into
Eurodollar Loans shall remain as Base Rate Loans.
If such Lender gives notice to the Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 3.7, 3.8 or 3.9 hereof that
gave rise to the Conversion of such Lender's Eurodollar Loans pursuant to this
Section 3.10 no longer exist (which such Lender agrees to do promptly upon such
circumstances ceasing to exist) at a time when Eurodollar Loans made by other
Lenders are outstanding, such Lender's Base Rate Loans shall be automatically
Converted, on the first day(s) of the next succeeding Interest Period(s) for
such outstanding Eurodollar Loans, to the extent necessary so that, after giving
effect thereto, all Loans held by the Lenders holding Eurodollar Loans and by
such Lender are held pro rata (as to principal amounts, interest rate basis, and
Interest Periods) in accordance with their respective Commitments.
3.11. TAXES.
(a) Except as otherwise provided herein, any and all payments by any
Credit Party to or for the account of any Lender or the Administrative Agent
hereunder or under any other Credit Document shall be made free and clear of and
without deduction for any and all present or future taxes, duties, levies,
imposts, deductions, charges or withholdings, and all liabilities with respect
thereto, EXCLUDING, in the case of each Lender and the Administrative Agent,
taxes imposed on it as a result of a present or former connection between the
Administrative Agent or such Lender and the jurisdiction of the Governmental
Authority imposing such tax or any political subdivision or taxing authority
thereof or therein (other than
58
any such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced this Credit Agreement or any other Credit Document) (all such
non-excluded taxes, duties, levies, imposts, deductions, charges, withholdings,
and liabilities being hereinafter referred to as "TAXES"). If any Credit Party
shall be required by law to deduct any Taxes from or in respect of any sum
payable under this Credit Agreement or any other Credit Document to any Lender
or the Administrative Agent, (i) the sum payable shall be increased as necessary
so that after making all required deductions of Taxes (including deductions
applicable to additional sums payable under this Section 3.11) such Lender or
the Administrative Agent receives an amount equal to the sum it would have
received had no such deductions been made, (ii) such Credit Party shall make
such deductions, (iii) such Credit Party shall pay the full amount deducted to
the relevant taxation authority or other authority in accordance with applicable
law, and (iv) such Credit Party shall furnish to the Administrative Agent, at
its address referred to in Section 11.1, the original or a certified copy of a
receipt evidencing payment thereof. Notwithstanding the foregoing, no additional
sums shall be payable pursuant to this Section 3.11(a) with respect to Taxes (A)
that are attributable to such Lender's failure to comply with Section 3.11(d),
or (B) that are United States withholding taxes imposed on amounts payable to
such Lender at the time the Lender becomes a party to this Credit Agreement or
(C) unless imposed as a result of a change in treaty, law or regulation.
(b) In addition, the Borrower agrees to pay any and all present or
future stamp or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under this Credit
Agreement or any other Credit Document or from the execution or delivery of, or
otherwise with respect to, this Credit Agreement or any other Credit Document
(hereinafter referred to as "OTHER TAXES").
(c) The Borrower agrees to indemnify each Lender and the Administrative
Agent for the full amount of Taxes and Other Taxes (including, without
limitation, any Taxes or Other Taxes imposed or asserted by any jurisdiction on
amounts payable under this Section 3.11) paid by such Lender or the
Administrative Agent (as the case may be) and any liability (including
penalties, interest, and expenses) arising therefrom or with respect thereto.
(d) Each Lender that is not a United States person under Section
7701(a)(30) of the Code, on or prior to the date of its execution and delivery
of this Credit Agreement in the case of each Lender listed on the signature
pages hereof and on or prior to the date on which it becomes a Lender in the
case of each other Lender, and from time to time thereafter if requested in
writing by the Borrower or the Administrative Agent (but only so long as such
Lender remains lawfully able to do so), shall provide the Borrower and the
Administrative Agent with (i) Internal Revenue Service Form W-8 BEN or W-8 ECI,
as appropriate, or any successor form prescribed by the Internal Revenue
Service, certifying that such Lender is entitled to benefits under an income tax
treaty to which the United States is a party which reduces to zero the rate of
withholding tax on payments of interest or certifying that the income receivable
pursuant to this Credit Agreement is effectively connected with the conduct of a
trade or business in the United States, (ii) Internal Revenue Service Form W-8
or W-9, as appropriate, or any successor form prescribed by the Internal Revenue
Service, and/or (iii) any other form or certificate required by any taxing
authority (including any certificate required by Sections 871(h) and 881(c) of
the Code), certifying that such Lender is entitled to an exemption from tax on
payments pursuant to
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this Credit Agreement or any of the other Credit Documents. In addition, each
Lender shall deliver such forms promptly upon the obsolescence or invalidity of
any form previously delivered by such Lender. Each Lender shall promptly notify
the Borrower at any time it determines that it is no longer in a position to
provide any previously delivered form to the Borrower (or any other form adopted
by the United States taxing authorities for such purposes).
(e) For any period with respect to which a Lender has failed to provide
the Borrower and the Administrative Agent with the appropriate form pursuant to
Section 3.11(d) (unless such failure is due to a change in treaty, law, or
regulation occurring subsequent to the date on which a form originally was
required to be provided), such Lender shall not be entitled to indemnification
under Section 3.11(a) or 3.11(b) with respect to Taxes imposed by the United
States; provided, however, that should a Lender, which is otherwise exempt from
withholding tax, become subject to Taxes because of its failure to deliver a
form required hereunder, the Borrower shall take such steps as such Lender shall
reasonably request to assist such Lender to recover such Taxes.
(f) If any Credit Party is required to pay additional amounts to or for
the account of any Lender pursuant to this Section 3.11, then such Lender will
agree to use reasonable efforts to change the jurisdiction of its Applicable
Lending Office so as to eliminate or reduce any such additional payment which
may thereafter accrue if such change, in the judgment of such Lender, is not
otherwise materially disadvantageous to such Lender.
(g) Without prejudice to the survival of any other agreement of the
Credit Parties hereunder, the agreements and obligations of the Credit Parties
contained in this Section 3.11 shall survive the repayment of the Loans, LOC
Obligations and other obligations under the Credit Documents and the termination
of the Commitments hereunder.
(h) If the Administrative Agent or any Lender receives a refund with
respect to Taxes paid by the Borrower, which in the good faith judgment of such
Lender is allocable to such payment, the Administrative Agent or Lender,
respectively shall promptly pay such refund, together with any other amounts
paid by the Borrower in connection with such refunded Taxes, to the Borrower,
net of all out-of-pocket expenses of such Lender incurred in obtaining such
refund, provided, however, that the Borrower agrees to promptly return such
refund to the Administrative Agent or the applicable Lender, as the case may be,
if it receives notice from the Administrative Agent or applicable Lender that
such Administrative Agent or Lender is required to repay such refund. Each of
the Administrative Agent and each Lender agrees that it will contest such Taxes
or liabilities if the Administrative Agent or such Lender determines, in its
reasonable judgment, that it would not be materially disadvantaged or prejudiced
as a result of such contest.
3.12. COMPENSATION.
Upon the request of any Lender, the Borrower shall pay to such Lender
such amount or amounts as shall be sufficient (in the reasonable opinion of such
Lender) to compensate it for any loss, cost, or expense (excluding loss of
anticipated profits) incurred by it as a result of:
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(a) any payment, prepayment, or Conversion of a Eurodollar Loan or
Quoted Rate Swingline Loan for any reason (other than in connection with any
assignment by any Lender pursuant to Section 11.3(b), but including acceleration
of the Loans pursuant to Section 9.2) on a date other than the last day of the
Interest Period for such Loan; or
(b) any failure by the Borrower for any reason (including, without
limitation, the failure of any condition precedent specified in Section 5 to be
satisfied) to borrow, Convert, Continue, or prepay a Eurodollar Loan or Quoted
Rate Swingline Loan on the date for such borrowing, Conversion, Continuation, or
prepayment specified in the relevant notice of borrowing, prepayment,
Continuation, or Conversion under this Credit Agreement.
With respect to Eurodollar Loans, such indemnification may include an amount
equal to the excess, if any, of (a) the amount of interest (other than the
Applicable Percentage) which would have accrued on the amount so prepaid, or not
so borrowed, Converted or Continued, for the period from the date of such
prepayment or of such failure to borrow, Convert or Continue to the last day of
the applicable Interest Period (or, in the case of a failure to borrow, Convert
or Continue, the Interest Period that would have commenced on the date of such
failure) in each case at the applicable rate of interest for such Eurodollar
Loans provided for herein (excluding, however, the Applicable Percentage
included therein, if any) over (b) the amount of interest (as reasonably
determined by such Lender) which would have accrued to such Lender on such
amount by placing such amount on deposit for a comparable period with leading
banks in the interbank Eurodollar market. Any Lender claiming compensation under
this Section 3.12 shall furnish to the Borrower and the Administrative Agent a
statement setting forth in reasonable detail the calculation of the amounts to
be paid to it hereunder. The covenants of the Borrower set forth in this Section
3.12 shall survive the repayment of the Loans, LOC Obligations and other
obligations under the Credit Documents and the termination of the Commitments
hereunder; provided, however, the Borrower shall not be required to compensate a
Lender pursuant to this Section 3.12 for any such loss, cost or expense incurred
more than 180 days prior to the date that such Lender notifies the Borrower of
the incurrence of such loss, cost or expense.
3.13. PRO RATA TREATMENT.
Except to the extent otherwise provided herein:
(a) LOANS. Each Loan, each payment or (subject to the terms of Section
3.3) prepayment of principal of any Loan or reimbursement obligations arising
from drawings under Letters of Credit, each payment of interest on the Loans or
reimbursement obligations arising from drawings under Letters of Credit, each
payment of Unused Fees, each payment of the Standby Letter of Credit Fee, each
payment of the Trade Letter of Credit Fee, each reduction of the Revolving
Committed Amount and each conversion or extension of any Loan, shall be
allocated pro rata among the Lenders in accordance with the respective principal
amounts of their outstanding Loans of the applicable type and Participation
Interests in Loans of the applicable type and Letters of Credit.
(b) ADVANCES. No Lender shall be responsible for the failure or delay
by any other Lender in its obligation to make its ratable share of a borrowing
hereunder; provided, however, that the failure of any Lender to fulfill its
obligations hereunder shall not relieve any
61
other Lender of its obligations hereunder. Unless the Administrative Agent shall
have been notified by any Lender prior to the date of any requested borrowing
that such Lender does not intend to make available to the Administrative Agent
its ratable share of such borrowing to be made on such date, the Administrative
Agent may assume that such Lender has made such amount available to the
Administrative Agent on the date of such borrowing, and the Administrative Agent
in reliance upon such assumption, may (in its sole discretion but without any
obligation to do so) 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 promptly 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 Rate.
3.14. SHARING OF PAYMENTS.
(a) The Lenders agree among themselves that, in the event that any
Lender shall obtain payment in respect of any Loan, LOC Obligations or any other
obligation owing to such Lender under this Credit Agreement through the exercise
of a right of setoff, banker's lien or counterclaim, or pursuant to a secured
claim under Section 506 of Title 11 of the United States Code or other security
or interest arising from, or in lieu of, such secured claim, received by such
Lender under any applicable bankruptcy, insolvency or other similar law or
otherwise, or by any other means, in excess of its pro rata share of such
payment as provided for in this Credit Agreement, such Lender shall promptly
purchase from the other Lenders a Participation Interest in such Loans, LOC
Obligations and other obligations in such amounts, and make such other
adjustments from time to time, as shall be equitable to the end that all Lenders
share such payment in accordance with their respective ratable shares as
provided for in this Credit Agreement. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of setoff, banker's lien, counterclaim or other event as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by repurchase of a
Participation Interest theretofore sold, return its share of that benefit
(together with its share of any accrued interest payable with respect thereto)
to each Lender whose payment shall have been rescinded or otherwise restored.
The Borrower agrees that any Lender so purchasing such a Participation Interest
may, to the fullest extent permitted by law and in a manner not inconsistent
with this Credit Agreement, exercise all rights of payment, including setoff,
banker's lien or counterclaim, with respect to such Participation Interest as
fully as if such Lender were a holder of such Loan, LOC Obligations or other
obligation in the amount of such Participation Interest. Except as otherwise
expressly provided in this Credit Agreement, if any Lender shall fail to remit
to the Administrative Agent or any other Lender an amount payable by such Lender
to the Administrative Agent or such other Lender pursuant to this Credit
Agreement on the date when such amount is due, such payments shall be made
together with interest thereon for each date
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from the date such amount is due until the date such amount is paid to the
Administrative Agent or such other Lender at a rate per annum equal to, for the
first two days, the Federal Funds Rate, and thereafter, the Adjusted Base Rate.
If under any applicable bankruptcy, insolvency or other similar law, any Lender
receives a secured claim in lieu of a setoff to which this Section 3.14 applies,
such Lender shall, to the extent practicable, exercise its rights in respect of
such secured claim in a manner consistent with the rights of the Lenders under
this Section 3.14 to share in the benefits of any recovery on such secured
claim.
3.15. PAYMENTS, COMPUTATIONS, ETC.
(a) GENERALLY. Except as otherwise specifically provided herein, all
payments hereunder shall be made to the Administrative Agent in Dollars in
immediately available funds, without setoff, deduction, counterclaim or
withholding of any kind, at the Administrative Agent's office specified in
Schedule 2.1(a) not later than 2:00 P.M. (New York City time) on the date when
due. Payments received after such time shall be deemed to have been received on
the next succeeding Business Day. The Borrower shall, at the time it makes any
payment under this Credit Agreement, specify to the Administrative Agent the
Loans, LOC Obligations, Fees, interest or other amounts payable by the Borrower
hereunder to which such payment is to be applied (and in the event that it fails
so to specify, or if such application would be inconsistent with the terms
hereof, the Administrative Agent shall distribute such payment to the Lenders in
such manner as the Administrative Agent may determine to be appropriate in
respect of obligations owing by the Borrower hereunder, subject to the terms of
Sections 3.3 and 3.13(a)). The Administrative Agent will distribute such
payments to such Lenders, if any such payment is received prior to 2:00 P.M.
(New York City time) on a Business Day in like funds as received prior to the
end of such Business Day and otherwise the Administrative Agent will distribute
such payment to such Lenders on the next succeeding Business Day. Whenever any
payment hereunder shall be stated to be due on a day which is not a Business
Day, the due date thereof shall be extended to the next succeeding Business Day
(subject to accrual of interest and Fees for the period of such extension),
except that in the case of Eurodollar Loans, if the extension would cause the
payment to be made in the next following calendar month, then such payment shall
instead be made on the next preceding Business Day. Except as expressly provided
otherwise herein, all computations of interest and fees shall be made on the
basis of actual number of days elapsed over a year of 360 days, except with
respect to computation of interest on Base Rate Loans which shall be calculated
based on a year of 365 or 366 days, as appropriate. Interest shall accrue from
and include the date of borrowing, but exclude the date of payment.
(b) ALLOCATION OF PAYMENTS AFTER ACCELERATION. Notwithstanding any
other provision of this Credit Agreement to the contrary, after acceleration of
the Credit Party Obligations pursuant to Section 9.2(b), all amounts collected
or received by the Administrative Agent or any Lender on account of the Credit
Party Obligations or in respect of the Collateral shall be paid over or
delivered as follows:
FIRST, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation reasonable attorneys' fees)
of the Administrative Agent in connection with enforcing the rights of
the Lenders under the Credit Documents and any
63
protective advances made by the Administrative Agent with respect to
the Collateral under or pursuant to the terms of the Collateral
Documents;
SECOND, to payment of any fees payable to the Administrative
Agent then due and owing;
THIRD, to the payment of all of the Credit Party Obligations
consisting of accrued fees and interest;
FOURTH, to the payment of the outstanding principal amount of
the Credit Party Obligations (including the payment or cash
collateralization of the outstanding LOC Obligations);
FIFTH, to the payment of all reasonable out-of-pocket costs
and expenses (including without limitation, reasonable attorneys' fees)
of each of the Lenders in connection with enforcing its rights under
the Credit Documents or otherwise with respect to the Credit Party
Obligations owing to such Lender;
SIXTH, to all other Credit Party Obligations and other
obligations which shall have become due and payable under the Credit
Documents or otherwise and not repaid pursuant to clauses "FIRST"
through "FIFTH" above; and
SEVENTH, to the payment of the surplus, if any, to whomever
may be lawfully entitled to receive such surplus.
In carrying out the foregoing, (i) amounts received shall be applied in the
numerical order provided until exhausted prior to application to the next
succeeding category; (ii) each of the Lenders shall receive an amount equal to
its pro rata share (based on the proportion that the then outstanding Loans and
LOC Obligations held by such Lender bears to the aggregate then outstanding
Loans and LOC Obligations) of amounts available to be applied pursuant to
clauses "THIRD", "FOURTH", "FIFTH" and "SIXTH" above; and (iii) to the extent
that any amounts available for distribution pursuant to clause "FIFTH" above are
attributable to the issued but undrawn amount of outstanding Letters of Credit,
such amounts shall be held by the Administrative Agent in a cash collateral
account and applied (A) first, to reimburse the Issuing Lender from time to time
for any drawings under such Letters of Credit and (B) then, following the
expiration of all Letters of Credit, to all other obligations of the types
described in clauses "FIFTH" and "SIXTH" above in the manner provided in this
Section 3.15(b).
3.16. EVIDENCE OF DEBT.
(a) Each Lender shall maintain an account or accounts evidencing each
Loan made by such Lender to the Borrower from time to time, including the
amounts of principal and interest payable and paid to such Lender from time to
time under this Credit Agreement. Each Lender will make reasonable efforts to
maintain the accuracy of its account or accounts and to promptly update its
account or accounts from time to time, as necessary.
(b) The Administrative Agent shall maintain the Register pursuant to
Section 11.3(b), and a subaccount for each Lender, in which Register and
subaccounts (taken together)
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shall be recorded (i) the amount, type and Interest Period of each such Loan
hereunder, (ii) the amount of any principal or interest due and payable or to
become due and payable to each Lender hereunder and (iii) the amount of any sum
received by the Administrative Agent hereunder from or for the account of any
Credit Party and each Lender's share thereof. The Administrative Agent will make
reasonable efforts to maintain the accuracy of the subaccounts referred to in
the preceding sentence and to promptly update such subaccounts from time to
time, as necessary.
(c) The entries made in the accounts, Register and subaccounts
maintained pursuant to clause (b) of this Section 3.16 (and, if consistent with
the entries of the Administrative Agent, clause (a)) shall be prima facie
evidence of the existence and amounts of the obligations of the Credit Parties
therein recorded; provided, however, that the failure of any Lender or the
Administrative Agent to maintain any such account, such Register or such
subaccount, as applicable, or any error therein, shall not in any manner affect
the obligation of the Credit Parties to repay the Credit Party Obligations owing
to such Lender.
3.17. REPLACEMENT OF AFFECTED LENDERS.
If (i) any Lender having a Revolving Commitment becomes a Defaulting
Lender or otherwise defaults in its Revolving Commitment, (ii) any Credit Party
is required to make any payments to any Lender under Section 3.6, Section 3.8,
Section 3.9 or Section 3.11 in excess of the proportionate amount (based on the
respective Commitments and/or Loans of the Lenders) of corresponding payments
required to be made to the other Lenders or (iii) in the event of a refusal by a
Lender to consent to a proposed change, waiver, discharge or termination which
requires only the consent of the Required Lenders, the Borrower shall have the
right to replace such Lender (the "REPLACED LENDER") with one or more other
Eligible Assignee or Eligible Assignees, none of whom shall constitute a
Defaulting Lender at the time of such replacement (collectively, the
"REPLACEMENT LENDER"), provided that (a) except in the case of clause (iii)
above, no Event of Default then exists, (b) at the time of any replacement
pursuant to this Section 3.17, the Replaced Lender and Replacement Lender shall
enter into an Assignment and Acceptance pursuant to which the Replacement Lender
shall acquire all or a portion, as the case may be, of the Commitments and
outstanding Loans of, and participation in Letters of Credit by, the Replaced
Lender and (c) all obligations of the Borrower owing to the Replaced Lender
relating to the Loans so replaced (including, without limitation, such increased
costs and excluding those specifically described in clause (b) above in respect
of which the assignment purchase price has been, or is concurrently being paid)
shall be paid in full to such Replaced Lender concurrently with such
replacement. Upon the execution of the appropriate Assignment and Acceptance,
the payment of amounts referred to in clauses (b) and (c) above and, if so
requested by the Replacement Lender, delivery to the Replacement Lender of the
appropriate Note or Notes executed by the Borrower, the Replacement Lender shall
become a Lender hereunder and the Replaced Lender shall cease to constitute a
Lender hereunder with respect to such replaced Loans, except with respect to
indemnification provisions under this Agreement, which shall survive as to such
Replaced Lender. Notwithstanding anything to the contrary contained above, (1)
the Lender that acts as the Issuing Lender may not be replaced hereunder at any
time that it has Letters of Credit outstanding hereunder unless arrangements
satisfactory to the Issuing Lender (including the furnishing of a back-up
standby letter of credit in form and substance, and issued by an issuer,
satisfactory to such Issuing Lender or the depositing of cash
65
collateral into a cash collateral account maintained with the Administrative
Agent in amounts and pursuant to arrangements satisfactory to such Issuing
Lender) have been made with respect to such outstanding Letters of Credit and
(2) the Lender that acts as the Administrative Agent may not be replaced
hereunder except in accordance with the terms of Section 10.7. The Replaced
Lender shall be required to deliver for cancellation its applicable Notes, if
any, to be canceled on the date of replacement, or if any such Note is lost or
unavailable, such other assurances or indemnification therefor as the Borrower
may reasonably request.
SECTION IV
GUARANTY
4.1. THE GUARANTY.
Each of the Guarantors hereby jointly and severally guarantees to each
Lender, each Affiliate of a Lender that enters into a Hedging Agreement, and the
Administrative Agent as hereinafter provided, as primary obligor and not as
surety, the prompt payment of the Credit Party Obligations in full when due
(whether at stated maturity, as a mandatory prepayment, by acceleration, as a
mandatory cash collateralization or otherwise) strictly in accordance with the
terms thereof. The Guarantors hereby further agree that if any of the Credit
Party Obligations are not paid in full when due (whether at stated maturity, as
a mandatory prepayment, by acceleration, as a mandatory cash collateralization
or otherwise), the Guarantors will, jointly and severally, promptly pay the
same, without any demand or notice whatsoever, and that in the case of any
extension of time of payment or renewal of any of the Credit Party Obligations,
the same will be promptly paid in full when due (whether at extended maturity,
as a mandatory prepayment, by acceleration, as a mandatory cash
collateralization or otherwise) in accordance with the terms of such extension
or renewal.
Notwithstanding any provision to the contrary contained herein or in
any other of the Credit Documents or Hedging Agreements, the maximum liability
of each Guarantor under this Credit Agreement and the other Credit Documents
shall in no event exceed the maximum amount which can be guaranteed by such
Guarantor under applicable federal and state laws relating to the insolvency of
debtors and fraudulent conveyance or transfers (after giving effect to the right
of contribution established in Section 4.6).
4.2. OBLIGATIONS UNCONDITIONAL.
The obligations of the Guarantors under Section 4.1 are joint and
several, absolute and unconditional, irrespective of the value, genuineness,
validity, regularity or enforceability of any of the Credit Documents or Hedging
Agreements, or any other agreement or instrument referred to therein, or any
substitution, release, impairment or exchange of any other guarantee of or
security for any of the Credit Party Obligations, and, to the fullest extent
permitted by applicable law, irrespective of any other circumstance whatsoever
which might otherwise constitute a legal or equitable discharge or defense of a
surety or guarantor, it being the intent of this Section 4.2 that the
obligations of the Guarantors hereunder shall be absolute and unconditional
under any and all circumstances. Each Guarantor agrees that such Guarantor shall
66
have no right of subrogation, indemnity, reimbursement or contribution against
the Borrower or any other Guarantor for amounts paid under this Section IV until
such time as the Credit Party Obligations have been Fully Satisfied. Without
limiting the generality of the foregoing, it is agreed that, to the fullest
extent permitted by law, the occurrence of any one or more of the following
shall not alter or impair the liability of any Guarantor hereunder which shall
remain absolute and unconditional as described above:
(a) at any time or from time to time, without notice to any Guarantor,
the time for any performance of or compliance with any of the Credit Party
Obligations shall be extended, or such performance or compliance shall be
waived;
(b) any of the acts mentioned in any of the provisions of any of the
Credit Documents, any Hedging Agreement between any Consolidated Party and any
Lender, or any Affiliate of a Lender, or any other agreement or instrument
referred to in the Credit Documents or such Hedging Agreements shall be done or
omitted;
(c) the maturity of any of the Credit Party Obligations shall be
accelerated, or any of the Credit Party Obligations shall be increased,
modified, supplemented or amended in any respect, or any right under any of the
Credit Documents, any Hedging Agreement between any Consolidated Party and any
Lender, or any Affiliate of a Lender, or any other agreement or instrument
referred to in the Credit Documents or such Hedging Agreements shall be waived
or released or any other guarantee of any of the Credit Party Obligations or any
security therefor shall be released, impaired or exchanged in whole or in part
or otherwise dealt with;
(d) any Lien granted to, or in favor of, the Administrative Agent or
any Lender or Lenders as security for any of the Credit Party Obligations shall
fail to attach or be perfected or shall be released; or
(e) any of the Credit Party Obligations shall be determined to be void
or voidable (including, without limitation, for the benefit of any creditor of
any Guarantor) or shall be subordinated to the claims of any Person (including,
without limitation, any creditor of any Guarantor).
With respect to its obligations hereunder, each Guarantor hereby expressly
waives diligence, presentment, demand of payment, protest and all notices
whatsoever, and any requirement that the Administrative Agent or any Lender
exhaust any right, power or remedy or proceed against any Person under any of
the Credit Documents, any Hedging Agreement between any Consolidated Party and
any Lender, or any Affiliate of a Lender, or any other agreement or instrument
referred to in the Credit Documents or such Hedging Agreements, or against any
other Person under any other guarantee of, or security for, any of the Credit
Party Obligations.
4.3. REINSTATEMENT.
The obligations of the Guarantors under this Section IV shall be
automatically reinstated if and to the extent that for any reason any payment by
or on behalf of any Person in respect of the Credit Party Obligations is
rescinded or must be otherwise restored by any holder of any of the Credit Party
Obligations, whether as a result of any proceedings in bankruptcy or
reorganization or otherwise, and each Guarantor agrees that it will indemnify
the Administrative
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Agent and each Lender on demand for all reasonable costs and expenses
(including, without limitation, fees and expenses of counsel) incurred by the
Administrative Agent or such Lender in connection with such rescission or
restoration, including any such costs and expenses incurred in defending against
any claim alleging that such payment constituted a preference, fraudulent
transfer or similar payment under any bankruptcy, insolvency or similar law.
4.4. CERTAIN ADDITIONAL WAIVERS.
Without limiting the generality of the provisions of this Section IV,
each Guarantor agrees that such Guarantor shall have no right of recourse to
security for the Credit Party Obligations, except through the exercise of rights
of subrogation pursuant to Section 4.2 and through the exercise of rights of
contribution pursuant to Section 4.6.
4.5. REMEDIES.
The Guarantors agree that, to the fullest extent permitted by law, as
between the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, the Credit Party Obligations may be declared to be
forthwith due and payable as provided in Section 9.2 (and shall be deemed to
have become automatically due and payable in the circumstances provided in said
Section 9.2) for purposes of Section 4.1 notwithstanding any stay, injunction or
other prohibition preventing such declaration (or preventing the Credit Party
Obligations from becoming automatically due and payable) as against any other
Person and that, in the event of such declaration (or the Credit Party
Obligations being deemed to have become automatically due and payable), the
Credit Party Obligations (whether or not due and payable by any other Person)
shall forthwith become due and payable by the Guarantors for purposes of Section
4.1. The Guarantors acknowledge and agree that their obligations hereunder are
secured in accordance with the terms of the Collateral Documents and that the
Lenders may exercise their remedies thereunder in accordance with the terms
thereof.
4.6. RIGHTS OF CONTRIBUTION.
The Guarantors hereby agree as among themselves that, if any Guarantor
shall make an Excess Payment (as defined below), such Guarantor shall have a
right of contribution from each other Guarantor in an amount equal to such other
Guarantor's Contribution Share (as defined below) of such Excess Payment. The
payment obligations of any Guarantor under this Section 4.6 shall be subordinate
and subject in right of payment to the Credit Party Obligations until such time
as the Credit Party Obligations have been Fully Satisfied, and none of the
Guarantors shall exercise any right or remedy under this Section 4.6 against any
other Guarantor until such Credit Party Obligations have been Fully Satisfied.
For purposes of this Section 4.6, (a) "EXCESS PAYMENT" shall mean the amount
paid by any Guarantor in excess of its Pro Rata Share of any Guaranteed
Obligations; (b) "PRO RATA SHARE" shall mean, for any Guarantor in respect of
any payment of Credit Party Obligations, the ratio (expressed as a percentage)
as of the date of such payment of Guaranteed Obligations of (i) the amount by
which the aggregate present fair salable value of all of its assets and
properties exceeds the amount of all debts and liabilities of such Guarantor
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of such Guarantor hereunder) to (ii) the amount by
which the aggregate present fair salable value of all assets and other
properties of all
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of the Credit Parties exceeds the amount of all of the debts and liabilities
(including contingent, subordinated, unmatured, and unliquidated liabilities,
but excluding the obligations of the Credit Parties hereunder) of the Credit
Parties; provided, however, that, for purposes of calculating the Pro Rata
Shares of the Guarantors in respect of any payment of Credit Party Obligations,
any Guarantor that became a Guarantor subsequent to the date of any such payment
shall be deemed to have been a Guarantor on the date of such payment and the
financial information for such Guarantor as of the date such Guarantor became a
Guarantor shall be utilized for such Guarantor in connection with such payment;
and (C) "CONTRIBUTION SHARE" shall mean, for any Guarantor in respect of any
Excess Payment made by any other Guarantor, the ratio (expressed as a
percentage) as of the date of such Excess Payment of (i) the amount by which the
aggregate present fair salable value of all of its assets and properties exceeds
the amount of all debts and liabilities of such Guarantor (including contingent,
subordinated, unmatured, and unliquidated liabilities, but excluding the
obligations of such Guarantor hereunder) to (ii) the amount by which the
aggregate present fair salable value of all assets and other properties of the
Credit Parties other than the maker of such Excess Payment exceeds the amount of
all of the debts and liabilities (including contingent, subordinated, unmatured,
and unliquidated liabilities, but excluding the obligations of the Credit
Parties) of the Credit Parties other than the maker of such Excess Payment;
provided, however, that, for purposes of calculating the Contribution Shares of
the Guarantors in respect of any Excess Payment, any Guarantor that became a
Guarantor subsequent to the date of any such Excess Payment shall be deemed to
have been a Guarantor on the date of such Excess Payment and the financial
information for such Guarantor as of the date such Guarantor became a Guarantor
shall be utilized for such Guarantor in connection with such Excess Payment.
This Section 4.6 shall not be deemed to affect any right of subrogation,
indemnity, reimbursement or contribution that any Guarantor may have under
applicable law against the Borrower in respect of any payment of Guaranteed
Obligations. Notwithstanding the foregoing, all rights of contribution against
any Guarantor shall terminate from and after such time, if ever, that such
Guarantor shall be relieved of its obligations pursuant to Section 8.5.
4.7. GUARANTEE OF PAYMENT; CONTINUING GUARANTEE.
The guarantee in this Section IV is a guaranty of payment and not of
collection, is a continuing guarantee, and shall apply to all Credit Party
Obligations whenever arising.
SECTION V
CONDITIONS
5.1. CLOSING CONDITIONS.
The obligation of the Lenders to enter into this Credit Agreement and
to make the initial Loans or the Issuing Lender to issue the initial Letter of
Credit, whichever shall occur first, shall be subject to satisfaction of the
following conditions:
(a) EXECUTED CREDIT DOCUMENTS. Receipt by the Administrative Agent of
duly executed copies of: (i) this Credit Agreement, (ii) the Collateral
Documents and (iii) all other Credit Documents.
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(b) CORPORATE DOCUMENTS. Receipt by the Administrative Agent of the
following:
(i) CHARTER DOCUMENTS. Copies of the articles or certificates
of incorporation or other charter documents of each Credit Party
certified to be true and complete as of a recent date by the
appropriate Governmental Authority of the state or other jurisdiction
of its incorporation and certified by a secretary or assistant
secretary of such Credit Party to be true and correct as of the Closing
Date.
(ii) BYLAWS. A copy of the bylaws of each Credit Party
certified by a secretary or assistant secretary of such Credit Party to
be true and correct as of the Closing Date.
(iii) RESOLUTIONS. Copies of resolutions of the Board of
Directors of each Credit Party approving and adopting the Credit
Documents to which it is a party, the transactions contemplated therein
and authorizing execution and delivery thereof, certified by a
secretary or assistant secretary of such Credit Party to be true and
correct and in force and effect as of the Closing Date.
(iv) GOOD STANDING. Copies of (A) certificates of good
standing, existence or its equivalent with respect to each Credit Party
certified as of a recent date by the appropriate Governmental
Authorities of the state or other jurisdiction of incorporation and
each other jurisdiction in which the failure to so qualify and be in
good standing could have a Material Adverse Effect and (B) to the
extent available, a certificate indicating payment of all corporate or
comparable franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.
(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.
(c) OPINION OF COUNSEL. The Administrative Agent shall have received,
in each case dated as of the Closing Date and in form and substance reasonably
satisfactory to the Administrative Agent legal opinion of Xxxxxxxx & Xxxxx,
counsel for the Credit Parties.
(d) PERSONAL PROPERTY COLLATERAL. The Administrative Agent shall have
received:
(i) searches of Uniform Commercial Code filings in the
jurisdiction of the chief executive office of each Credit Party and
each jurisdiction 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 on the Collateral exist other than Permitted
Liens;
(ii) duly authorized UCC financing statements for each
appropriate jurisdiction as is necessary, in the Administrative Agent's
reasonable discretion, to perfect the Administrative Agent's security
interest in the Collateral;
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(iii) all certificates evidencing any certificated Capital
Stock pledged to the Administrative Agent pursuant to the Collateral
Agreement, together with duly executed in blank, undated stock powers
attached thereto (unless, with respect to the pledged Capital Stock of
any Foreign Subsidiary, such stock powers are deemed unnecessary by the
Administrative Agent in its reasonable discretion under the law of the
jurisdiction of incorporation of such Person);
(iv) duly executed notices of grant of security interest in
the form required by the Collateral Agreement as are necessary, in the
Administrative Agent's sole discretion, to perfect the Administrative
Agent's security interest in the Collateral; and
(v) all instruments and chattel paper having a value in excess
of $100,000 in the possession of any of the Credit Parties, together
with allonges or assignments as may be necessary or appropriate to
perfect the Administrative Agent's security interest in the Collateral.
(e) REAL PROPERTY COLLATERAL. Except with respect to the owned Real
Properties identified as "Excluded Property" on Schedule 6.20(a), the
Administrative Agent shall have received the following, in form and substance
reasonably satisfactory to the Administrative Agent:
(i) fully executed and notarized mortgages, deeds of trust or
deeds to secure debt (each, as the same may be amended, modified,
restated or supplemented from time to time, a "MORTGAGE INSTRUMENT" and
collectively the "MORTGAGE INSTRUMENTS") encumbering the fee interest
of any Credit Party in each of the Real Properties designated in
Schedule 6.20(a) which are not identified on such Schedule as "Excluded
Properties" (each a "MORTGAGED PROPERTY" and collectively the
"MORTGAGED PROPERTIES");
(ii) with respect to each of the Real Properties identified as
items [ ] on subpart (1) of Schedule 6.20(a), maps or plats of an
as-built survey of the sites of the real property covered by the
Mortgage Instruments reasonably satisfactory to each of the
Administrative Agent and the Title Insurance Company, dated a date
reasonably satisfactory to each of the Administrative Agent and the
Title Insurance Company by an independent professional licensed land
surveyor, which maps or plats and the surveys on which they are based,
together with any related survey affidavits, shall be sufficient to
delete any standard printed survey exception contained in the
applicable title policy;
(iii) ALTA mortgagee title insurance policies issued by
Chicago Title Insurance Company (the "TITLE INSURANCE COMPANY") in
amounts not less than the respective amounts designated in Schedule
6.20(a) with respect to any particular Mortgaged Property, assuring the
Administrative Agent that each of the Mortgage Instruments creates a
valid and enforceable first priority mortgage lien on the applicable
Mortgaged Property, free and clear of all defects and encumbrances
except Permitted Liens, which policies shall otherwise be in form and
substance reasonably satisfactory to the Administrative Agent and shall
include such endorsements as are reasonably
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requested by the Administrative Agent to the extent such endorsements
are reasonably available in the jurisdictions in which the Mortgaged
Properties are located; and
(iv) evidence as to (A) whether any Mortgaged Property is in
an area designated by the Federal Emergency Management Agency as having
special flood or mud slide hazards (a "FLOOD HAZARD PROPERTY") and (B)
if any Mortgaged Property is a Flood Hazard Property, (1) whether the
community in which such Mortgaged Property is located is participating
in the National Flood Insurance Program, (2) the applicable Credit
Party's written acknowledgment of receipt of written notification from
the Administrative Agent (a) as to the fact that such Mortgaged
Property is a Flood Hazard Property and (b) as to whether the community
in which each such Flood Hazard Property is located is participating in
the National Flood Insurance Program and (3) copies of insurance
policies or certificates of insurance of the Consolidated Parties
evidencing flood insurance satisfactory to the Administrative Agent and
naming the Administrative Agent as sole loss payee on behalf of the
Lenders.
(f) EVIDENCE OF INSURANCE. Receipt by the Administrative Agent of
copies of insurance policies or certificates of insurance of the Consolidated
Parties evidencing liability and casualty insurance meeting the requirements set
forth in the Credit Agreement, including, but not limited to, naming the
Administrative Agent as additional insured (in the case of liability insurance)
or loss payee (in the case of hazard insurance) on behalf of the Lenders.
(g) GOVERNMENT CONSENT. Receipt by the Administrative Agent of evidence
that all material governmental, shareholder and third party consents (including
Xxxx-Xxxxx-Xxxxxx clearance) and approvals necessary in connection with the
Transaction and expiration of all applicable waiting periods without any action
being taken by any authority that could restrain, prevent or impose any material
adverse conditions on the Transaction or that could seek or threaten any of the
foregoing.
(h) CONSUMMATION OF TRANSACTION. The Transaction shall have been
consummated in accordance in all material respects with the terms of the Unit
Purchase Agreement and in compliance in all material respects with applicable
law and regulatory approvals; all conditions precedent to the obligations of the
Buyer under the Unit Purchase Agreement shall have been satisfied in all
material respects; and (i) the Equity Investors shall have invested at least
$175,000,000 in cash (of which at least $150,000,000 shall be from the Sponsor)
in Holdings LLC pursuant to the Unit Purchase Agreement and such amount shall
have been contributed (directly or indirectly) to the Borrower; (ii) the common
and preferred units of Holdings LLC issued pursuant to the Transaction shall not
contain mandatory redemption provisions or require the payment of dividends
prior to the day which is 91 days after the final scheduled maturity date of the
Credit Facilities except in kind or, in the case of such preferred units, upon
the occurrence of a change in control; (iii) the Capital Stock of the Borrower
shall consist of a single class of common stock; (iv) the 11 7/8% Senior
Subordinated Indenture shall have been amended pursuant to the Consent
Solicitation in order to permit the Transaction, the Credit Facilities and the
other Credit Documents; and (v) after giving effect to the Transaction,
including the application on the Closing Date of the proceeds of the related
financings and equity contributions, the Consolidated Parties shall have no
Indebtedness or Qualified Preferred Stock except for Indebtedness permitted
under Section 8.1. The Administrative Agent shall have
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received a copy, certified by an Executive Officer of the Borrower as true and
complete, of each of the Unit Purchase Agreement and each Purchase Related
Agreement, each as originally executed and delivered, together with all exhibits
and schedules, none of which shall have been altered, amended or otherwise
changed or supplemented in any material respect or any material condition
therein waived, without the prior written consent of the Administrative Agent.
The Administrative Agent shall have received a copy, certified by an Executive
Officer of the Borrower as true and complete, of the 11 7/8% Senior Subordinated
Indenture, the 12 1/4% Senior Subordinated Indenture and the GLK Note, each as
originally executed and delivered, together with all exhibits and schedules
thereto.
(i) SOLVENCY. Receipt by the Administrative Agent of a certificate
executed by the chief financial officer of the Parent as of the Closing Date, in
form and substance satisfactory to the Administrative Agent, regarding the
Solvency of the Credit Parties on a consolidated basis.
(j) OFFICER'S CERTIFICATES. The Administrative Agent shall have
received a certificate or certificates executed by an Executive Officer of the
Borrower as of the Closing Date, in form and substance reasonably satisfactory
to the Administrative Agent, stating that (A) each Credit Party is in compliance
with all existing material financial obligations which are to remain
outstanding, (B) all material governmental, shareholder and third party consents
and approvals, if any, with respect to the Credit Documents and the transactions
contemplated thereby have been obtained, (C) no action, suit, investigation or
proceeding is pending or threatened in any court or before any arbitrator or
governmental instrumentality that purports to affect any Credit Party or any
transaction contemplated by the Credit Documents, if such action, suit,
investigation or proceeding could reasonably be expected to have a Material
Adverse Effect, (D) the transactions contemplated by the Unit Purchase Agreement
have been consummated in accordance in all material respects with the terms
thereof and (E) immediately after giving effect to the Transaction, (1) no
Default or Event of Default exists and (2) all representations and warranties
contained herein, in the other Credit Documents are true and correct in all
material respects.
(k) FEES AND EXPENSES. Payment by the Credit Parties to the Lenders and
the Administrative Agent of all fees and expenses relating to the Credit
Facilities which are due and payable on the Closing Date, including, without
limitation, payment to the Administrative Agent of the fees set forth in the
Administrative Agent's Fee Letter.
(l) EXISTING CREDIT AGREEMENT. The Administrative Agent shall be
satisfied with the arrangement for the repayment in full (other than the
Existing Letters of Credit)and termination on or before the Closing Date of the
Existing Credit Agreement therefor and the termination of all liens, guarantees
and other credit support therefor.
(m) PRO FORMA BALANCE SHEET; FINANCIAL STATEMENTS. The Lenders shall
have received (i) (A) an unaudited pro forma consolidated balance sheet of the
Parent and the Borrower as of March 30, 2002, after giving effect to the
Transactions and the consummation of the other transactions contemplated hereby
and (B) audited consolidated balance sheets and related statements of income and
cash flow for the Borrower for the years ended on or about June 30, 1999, 2000
and 2001 and (ii) unaudited consolidated balance sheets
73
and related statements of income and cash flows for the Borrower for each fiscal
quarter, and monthly balance sheets and statements of income for the Borrower
for each fiscal month, in each case ending after June 30, 2001, and prior to the
Closing Date for which statements are available, in each case in form and
substance reasonably satisfactory to the Administrative Agent.
(n) PRO FORMA CONSOLIDATED LEVERAGE RATIO. The pro forma Consolidated
Leverage Ratio of the Borrower for the 12 months ending June 29, 2002 shall be
no greater than 4.65 to 1.0 (calculated in a manner reasonably satisfactory to
the Administrative Agent and consistent with the financial models previously
furnished by the Sponsor to the Administrative Agent).
5.2. CONDITIONS TO ALL EXTENSIONS OF CREDIT.
The obligations of each Lender to make any Loan and of the Issuing
Lender to issue or extend any Letter of Credit (including the initial Loans and
the initial Letter of Credit) are subject to satisfaction of the following
conditions in addition to satisfaction on the Closing Date of the conditions set
forth in Section 5.1:
(a) The Borrower shall have delivered (i) in the case of any Revolving
Loan or any portion of the Tranche B Term Loan, an appropriate Notice of
Borrowing or (ii) in the case of any Letter of Credit, the Issuing Lender shall
have received an appropriate request for issuance in accordance with the
provisions of Section 2.2(b);
(b) (i) the representations and warranties set forth in Section 6
shall, subject to the limitations set forth therein, be true and correct in all
material respects as of such date (except for those which expressly relate to an
earlier date) and (ii) no Default or Event of Default shall exist and be
continuing either prior to or after giving effect thereto; and
(c) In the case of a request for a Revolving Loan or a Letter of
Credit, immediately after giving effect to the making of such Loan (and the
application of the proceeds thereof) or to the issuance of such Letter of
Credit, as the case may be, (i) the sum of the aggregate outstanding principal
amount of Revolving Loans plus LOC Obligations plus Swingline Loans shall not
exceed the Revolving Committed Amount, and (ii) the LOC Obligations shall not
exceed the LOC Committed Amount.
The delivery of each Notice of Borrowing and each request for a Letter of Credit
pursuant to Section 2.2(b) shall constitute a representation and warranty by the
Credit Parties of the correctness of the matters specified in subsections (b)
and (c) above.
SECTION VI
REPRESENTATIONS AND WARRANTIES
The Credit Parties hereby represent to the Administrative Agent and
each Lender that:
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6.1. FINANCIAL CONDITION.
(a) The audited consolidated balance sheets and income statements of
the Consolidated Parties for the fiscal years ended June 30, 1999, June 30, 2000
and June 30, 2001 (including the notes thereto) (i) have been audited by
PricewaterhouseCoopers LLP, (ii) have been prepared in accordance with GAAP
consistently applied throughout the periods covered thereby and (iii) present
fairly (on the basis disclosed in the footnotes to such financial statements) in
all material respects the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods. The unaudited interim balance sheets of the Consolidated Parties
as at the end of, and the related unaudited interim income statements for the
fiscal quarter ended in, March 2002 (copies of which previously have been
delivered to the Administrative Agent) (i) have been prepared in accordance with
GAAP consistently applied throughout the periods covered thereby (except for the
absence of footnotes and subject to year-end audit adjustments) and (ii) present
fairly (on the basis disclosed in the footnotes to such financial statements) in
all material respects the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods. During the period from June 30, 2001 to and including the Closing
Date, there has been no sale, transfer or other disposition by any Consolidated
Party of any material part of the business or property of the Consolidated
Parties, taken as a whole, and no purchase or other acquisition by any of them
of any business or property (including any Capital Stock of any other Person)
material in relation to the consolidated financial condition of the Consolidated
Parties, taken as a whole, in each case, which is not reflected in the foregoing
financial statements or in the notes thereto and has not otherwise been
disclosed in writing to the Lenders on or prior to the Closing Date. As of the
Closing Date, the Borrower and its Subsidiaries have no material liabilities
(contingent or otherwise) that are not reflected (but required to be reflected)
in the foregoing financial statements or in the notes thereto which could
reasonably be expected to have a Material Adverse Effect except as described on
Schedule 6.1.
(b) The pro forma consolidated balance sheet as of March 30, 2002 and
the pro forma income statement of the Consolidated Parties for the nine month
period ending March 30, 2002 giving effect to the Transaction (i) meet the
requirements of Regulation S-X of the Securities Act applicable to a Form S-1
registration statement under the Securities Act ("REGULATION S-X") and (ii) are
based upon reasonable assumptions made known to the Lenders and upon information
not known to be incorrect or misleading in any material respect.
(c) To the extent delivered, the financial statements delivered
pursuant to Section 7.1(a) and (b) have been prepared in accordance with GAAP
(except as may otherwise be permitted under Section 7.1(a) and (b)) and present
fairly (on the basis disclosed in the footnotes to such financial statements) in
all material respects the consolidated financial condition, results of
operations and cash flows of the Consolidated Parties as of such date and for
such periods (except for, in the case of the financial statements described in
Section 7.1(b), the absence of footnotes and subject to year-end audit
adjustments).
(d) Notwithstanding anything to the contrary set forth in this Section
6.1, it is understood and agreed by the Lenders that it is possible that the
Consolidated Parties may have to restate its financial statements as a result of
a goodwill charge as described in the Borrower's 8-K filings on June 21, 2002
and July 9, 2002 and that the foregoing representations shall be
75
deemed so modified and that any such restatement shall not result in any
misrepresentation pursuant to this Section or any other provision of this
Agreement.
6.2. NO MATERIAL CHANGE.
Since June 30, 2001, there has been no development or event relating to
or affecting a Consolidated Party which has had or could reasonably be expected
to have a Material Adverse Effect.
6.3. ORGANIZATION AND GOOD STANDING.
Each of the Consolidated Parties (a) is duly organized, validly
existing and is in good standing under the laws of the jurisdiction of its
incorporation or organization, (b) has the corporate or other necessary power
and authority, and the legal right, to own and operate its property, to lease
the property it operates as lessee and to conduct the business in which it is
currently engaged and (c) is duly qualified as a foreign entity 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, other than in such jurisdictions where the failure to be so
qualified and in good standing would not have a Material Adverse Effect.
6.4. POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
Each of the Credit Parties has the corporate or other necessary power
and authority, and the legal right, to make, deliver and perform the Credit
Documents to which it is a party, and in the case of the Borrower, to obtain
extensions of credit hereunder, and has taken all necessary corporate or other
necessary action to authorize the borrowings and other extensions of credit on
the terms and conditions of this Credit Agreement and to authorize the
execution, delivery and performance of the Credit Documents to which it is a
party. No consent or authorization of, filing with, notice to or other similar
act by or in respect of, any Governmental Authority or any other Person is
required to be obtained or made by or on behalf of any Credit Party in
connection with the borrowings or other extensions of credit hereunder, with the
execution, delivery, performance, validity or enforceability of the Credit
Documents to which such Credit Party is a party or with the consummation of the
Transaction, except for (i) consents, authorizations, notices and filings
described in Schedule 6.4, all of which have been obtained or made or have the
status described in such Schedule 6.4, (ii) filings to release Liens to the
extent that the holders of such Liens have agreed in writing with the
Administrative Agent to release such Liens, (iii) filings to perfect the Liens
created by the Collateral Documents and (iv) consents, authorizations, filings,
notices or other acts which have been obtained as and when required or the
failure to make or obtain could not reasonably be expected to have a Material
Adverse Effect. This Credit Agreement has been, and each other Credit Document
to which any Credit Party is a party will be, duly executed and delivered on
behalf of the Credit Parties. This Credit Agreement constitutes, and each other
Credit Document to which any Credit Party is a party when executed and delivered
will constitute, a legal, valid and binding obligation of such Credit Party
enforceable against such party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, fraudulent conveyance,
insolvency, reorganization, moratorium or similar laws affecting the enforcement
of creditors' rights generally and by
76
general equitable principles (whether enforcement is sought by proceedings in
equity or at law) and by an implied covenant of good faith and fair dealing.
6.5. NO CONFLICTS.
Neither the execution and delivery of the Credit Documents, nor the
consummation of the transactions contemplated therein, nor performance of and
compliance with the terms and provisions thereof by such Credit Party will (a)
violate or conflict with any provision of its articles or certificate of
incorporation or bylaws or other organizational or governing documents of such
Person, (b) violate, contravene or materially conflict with any material
Requirement of Law or any other material law, regulation (including, without
limitation, Regulation U or Regulation X), order, writ, judgment, injunction,
decree or permit applicable to it, (c) violate, contravene or conflict with
contractual provisions of, or cause an event of default under, any indenture,
loan agreement, mortgage, deed of trust, contract or other agreement or
instrument to which it is a party or by which it may be bound, the violation of
which could reasonably be expected to have a Material Adverse Effect, or (d)
result in or require the creation of any Lien (other than those contemplated in
or created in connection with the Credit Documents) upon or with respect to its
properties.
6.6. NO DEFAULT.
No Consolidated Party is in default in any respect under any contract,
lease, loan agreement, indenture, mortgage, security agreement or other
agreement or obligation to which it is a party or by which any of its properties
is bound which default could reasonably be expected to have a Material Adverse
Effect.
6.7. OWNERSHIP.
Each Consolidated Party is the owner of, and has good and marketable
title to, all of its respective assets (including Intellectual Property) owned
by it necessary for the conduct of its business, except for minor defects in
title that do not materially interfere with its ability to conduct its business
or to utilize such assets for their intended purposes and none of such assets or
Intellectual Property is subject to any Lien other than Permitted Liens.
6.8. INDEBTEDNESS.
Except as otherwise permitted under Section 8.1, the Consolidated
Parties have no Indebtedness.
6.9. LITIGATION.
Except as disclosed in Schedule 6.9, there does not exist (i) any
order, decree, judgment, ruling or injunction which restrains the consummation
of the acquisition of the Acquired Company in the manner contemplated by the
Unit Purchase Agreement or (ii) any pending or, to the knowledge of any
Consolidated Party, threatened action, suit or legal, equitable, arbitration or
administrative proceeding against any Consolidated Party which could reasonably
be expected to have a Material Adverse Effect.
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6.10. TAXES.
Each Consolidated Party has filed, or caused to be filed, all material
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 material 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 or (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 failure of which to pay could reasonably be
expected to result in a Material Adverse Effect. No Credit Party is aware as of
the Closing Date of any material proposed tax assessments against it or any
other Consolidated Party.
6.11. COMPLIANCE WITH LAW.
Each Consolidated Party is in compliance with all Requirements of Law
applicable to it, or to its properties, unless such failure to comply could not
reasonably be expected to have a Material Adverse Effect. Without limiting the
generality of the preceding sentence, (i) the Consolidated Parties have produced
and distributed and are producing and distributing food products that are in
compliance with the Food Security Act, FFDCA and all other applicable federal
and state laws governing the production of food, and all applicable regulations
and administrative interpretations promulgated under any such laws except for
any violations or failures which could not reasonably be expected to have a
Material Adverse Effect and (ii) none of the Consolidated Parties has violated
or failed to comply with PACA or similar laws or regulations applicable to it,
except for any violation or failure which could not reasonably be expected to
have a Material Adverse Effect.
6.12. ERISA.
Except as disclosed and described in Schedule 6.12 attached hereto or
except as could not reasonably be expected to result in a Material Adverse
Effect:
(a) During the five-year period prior to the date on which this
representation is made or deemed made: (i) no ERISA Event has occurred, and, to
the knowledge of the Executive Officers of the Credit Parties, no event or
condition has occurred or exists as a result of which any ERISA Event could
reasonably be expected to occur, with respect to any Plan; (ii) no "accumulated
funding deficiency," as such term is defined in Section 302 of ERISA and Section
412 of the Code, whether or not waived, has occurred with respect to any Plan;
(iii) each Plan has been maintained, operated, and funded in compliance with its
own terms and in material compliance with the provisions of ERISA, the Code, and
any other applicable Federal or state laws; and no Lien in favor of the PBGC or
a Plan has arisen or is reasonably likely to arise on account of any Plan (other
than a Permitted Lien).
(b) The actuarial present value of all "benefit liabilities" (as
defined in Section 4001(a)(16) of ERISA), whether or not vested, under each
Single Employer Plan, as of the last annual valuation date prior to the date on
which this representation is made or deemed made (determined, in each case, in
accordance with Financial Accounting Standards Board Statement
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87, utilizing the actuarial assumptions used in such Plan's most recent
actuarial valuation report), did not exceed as of such valuation date the fair
market value of the assets of such Plan by such amount as could reasonably be
expected to have a Material Adverse Effect.
(c) Neither any Consolidated Party nor any ERISA Affiliate has received
any notification that any Multiemployer Plan is in reorganization (within the
meaning of Section 4241 of ERISA), is insolvent (within the meaning of Section
4245 of ERISA), or has been terminated (within the meaning of Title IV of
ERISA), and no Multiemployer Plan is, to the knowledge of the Executive Officers
of the Credit Parties, reasonably expected to be in reorganization, insolvent,
or terminated.
(d) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) or breach of fiduciary responsibility has
occurred with respect to a Plan which has subjected or may subject any
Consolidated Party or any ERISA Affiliate to any liability under Sections 406,
409, 502(i), or 502(l) of ERISA or Section 4975 of the Code, or under any
agreement or other instrument pursuant to which any Consolidated Party or any
ERISA Affiliate has agreed or is required to indemnify any Person against any
such liability.
(e) Neither any Consolidated Party nor any ERISA Affiliate has any
material liability with respect to "expected post-retirement benefit
obligations" within the meaning of the Financial Accounting Standards Board
Statement 106. Each Plan which is a welfare plan (as defined in Section 3(1) of
ERISA) to which Sections 601-609 of ERISA and Section 4980B of the Code apply
has been administered in compliance in all material respects with the
requirements of such sections.
(f) Neither the execution and delivery of this Credit Agreement nor the
consummation of the financing transactions contemplated hereunder will involve
any transaction which is subject to the prohibitions of Sections 404, 406 or 407
of ERISA or in connection with which a tax could be imposed pursuant to Section
4975 of the Code. The representation by the Credit Parties in the preceding
sentence is made in reliance upon and subject to the accuracy of the Lenders'
representation in Section 11.15 with respect to their source of funds.
6.13. CORPORATE STRUCTURE; CAPITAL STOCK, ETC.
The corporate capital and ownership structure of the Consolidated
Parties as of the Closing Date after giving effect to the Transaction is as
described in Schedule 6.13A. Set forth on Schedule 6.13B is a complete and
accurate list as of the Closing Date with respect to the Borrower and each of
its direct and indirect Subsidiaries of (i) jurisdiction of incorporation, (ii)
number of shares of each class of Capital Stock outstanding, (iii) number and
percentage of outstanding shares of each class owned (directly or indirectly) by
the Consolidated Parties and (iv) number and effect, if exercised, of all
outstanding options, warrants, rights of conversion or purchase and all other
similar rights with respect thereto as of the Closing Date. As of the Closing
Date, the outstanding Capital Stock of all such Persons is validly issued, fully
paid and (to the extent such concept is applicable) non-assessable and is owned
by the Consolidated Parties, directly or indirectly, in the manner set forth on
Schedule 6.13B, free and clear of all Liens (other than those arising under or
contemplated in connection with the Credit Documents). Other than as set forth
in Schedule 6.13B, as of the Closing Date neither the Borrower nor any of
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its Subsidiaries has outstanding any securities convertible into or exchangeable
for its Capital Stock nor does any such Person have outstanding any rights to
subscribe for or to purchase or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to its Capital Stock.
6.14. GOVERNMENTAL REGULATIONS, ETC.
(a) None of the transactions contemplated by this Credit Agreement
(including, without limitation, the direct or indirect use of the proceeds of
the Loans) will violate or result in a violation of the Securities Act, the
Securities Exchange Act or any of Regulations U and X. If requested by any
Lender or the Administrative Agent, the Borrower will furnish to the
Administrative Agent and each Lender a statement, in conformity with the
requirements of FR Form U-1 referred to in Regulation U, that no part of the
Letters of Credit or proceeds of the Loans will be used, directly or indirectly,
for the purpose of "buying" or "carrying" any "margin stock" within the meaning
of Regulations U and X, or for the purpose of purchasing or carrying or trading
in any securities.
(b) None of the Consolidated Parties is (i) an "investment company", or
a company "controlled" by "investment company", within the meaning of the
Investment Company Act of 1940, as amended, (ii) a "holding company" as defined
in, or otherwise subject to regulation under, the Public Utility Holding Company
Act of 1935, as amended or (iii) subject to regulation under any other Federal
or state statute or regulation which limits its ability to incur Indebtedness.
6.15. PURPOSE OF LOANS AND LETTERS OF CREDIT.
The proceeds of the Loans hereunder shall be used solely by the
Borrower to effect the Transaction, to pay fees and expenses related to the
Transaction and to provide for working capital and general corporate purposes of
the Borrower and its Subsidiaries (including, without limitation, Permitted
Acquisitions). 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, workers compensation and obligations not otherwise aforementioned
relating to transactions entered into by the applicable account party in the
ordinary course of business.
6.16. ENVIRONMENTAL MATTERS.
Except as disclosed and described in Schedule 6.16 attached hereto or
except as could not reasonably be expected to result in a Material Adverse
Effect:
(a) Each of the Real Properties and all operations at the Real
Properties are in compliance with all applicable Environmental Laws, there is no
violation of any Environmental Law with respect to the Real Properties or the
Businesses, and there are no conditions relating to the Real Properties or the
Businesses that could give rise to liability under any applicable Environmental
Laws.
(b) None of the Real Properties contains, or has previously contained,
any Materials of Environmental Concern at, on or under the Real Properties in
amounts or
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concentrations that constitute or constituted a violation of, or could give rise
to liability under, Environmental Laws.
(c) No Consolidated Party has received any written or verbal notice of,
or inquiry from any Governmental Authority regarding, any violation, alleged
violation, non-compliance, liability or potential liability regarding
environmental matters or compliance with Environmental Laws with regard to any
of the Real Properties or the Businesses, nor does any Executive Officer of any
Credit Party have knowledge or reason to believe that any such notice will be
received or is being threatened.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Real Properties, or generated, treated, stored or disposed
of at, on or under any of the Real Properties or any other location, in each
case by or on behalf of any Consolidated Party 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 best knowledge of the Executive Officers of the Credit
Parties, threatened, under any Environmental Law to which any Consolidated Party
is or will be named as a party, 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 Consolidated Parties, the Real Properties or the Businesses.
(f) There has been no release, or threat of release, of Materials of
Environmental Concern at or from the Real Properties, or arising from or related
to the operations (including, without limitation, disposal) of any Consolidated
Party in connection with the Real Properties or otherwise in connection with the
Businesses, in violation of or in amounts or in a manner that could reasonably
be expected to give rise to liability under Environmental Laws.
6.17. INTELLECTUAL PROPERTY.
Each Consolidated Party owns, or has the legal right to use, all
trademarks, service marks, trade names, trade dress, patents, copyrights,
technology, know how and processes (the "INTELLECTUAL PROPERTY") necessary for
each of them to conduct its business as currently conducted except for those the
failure to own or have such legal right to use could not reasonably be expected
to have a Material Adverse Effect. Set forth on Schedule 6.17 as of the Closing
Date is a list of all Intellectual Property registered or pending registration
with the United States Copyright Office or the United States Patent and
Trademark Office and owned by each Consolidated Party. Except as provided on
Schedule 6.17, no claim has been asserted and is pending by any Person
challenging or questioning the use of the Intellectual Property or the validity
or effectiveness of the Intellectual Property, nor does any Credit Party know of
any such claim, and, to the knowledge of the Executive Officers of the Credit
Parties, the use of the Intellectual Property by any Consolidated Party or the
granting of a right or a license in respect of the Intellectual Property from
any Consolidated Party 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.
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6.18. SOLVENCY.
The Credit Parties are Solvent on a consolidated basis.
6.19. INVESTMENTS.
All Investments of each Consolidated Party are Permitted Investments.
6.20. BUSINESS LOCATIONS.
Set forth on Schedule 6.20(a) is a list of all Real Properties located
in the United States as of the Closing Date. Set forth on Schedule 6.20(b) is a
list of all owned or leased locations where any tangible personal property of a
Consolidated Party is located as of the Closing Date (other than vehicles and
assets temporarily in transit or sent for repair). Set forth on Schedule 6.20(c)
is the chief executive office, jurisdiction of incorporation or formation and
principal place of business of each Consolidated Party as of the Closing Date.
6.21. DISCLOSURE.
Neither this Credit Agreement nor any financial statements (other than
projections, budgets and other estimates) delivered to the Lenders nor any other
document, certificate or statement furnished to the Lenders by or on behalf of
any Consolidated Party in connection with the transactions contemplated hereby,
when taken as a whole, contains as of the applicable delivery date any untrue
statement of a material fact or omits to state a material fact necessary in
order to make the statements contained therein or herein not materially
misleading in light of the circumstances under which such statements were made.
6.22. BROKERS' FEES.
Except as set forth on Schedule 6.22, no Consolidated Party 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 Administrative Agent's
Fee Letter.
6.23. LABOR MATTERS.
Except as set forth on Schedule 6.23, there are no collective
bargaining agreements or Multiemployer Plans covering the employees of a
Consolidated Party as of the Closing Date. None of the Consolidated Parties has
suffered any strikes, walkouts, work stoppages or other material labor
difficulty during the five years prior to the Closing Date except, with respect
to any of the foregoing, which could reasonably be expected to have a Material
Adverse Effect.
6.24. NATURE OF BUSINESS.
As of the Closing Date, the Borrower is principally engaged in the
business of producing and marketing processed frozen vegetables and other food
products.
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6.25. SENIORITY.
The Credit Party Obligations constitute "Senior Debt" or "Guarantor
Senior Debt" (however denominated), as applicable, under the 11 7/8% Senior
Subordinated Indenture or, when executed, the Refinancing Senior Subordinated
Indenture or any other Subordinated Debt Indenture. The Credit Party Obligations
of the Borrower under clause (i) of the definition thereof constitute "Senior
Debt" under the GLK Note.
SECTION VII
AFFIRMATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until such time as
the Credit Agreement has been terminated in accordance with the terms of Section
11.13:
7.1. INFORMATION COVENANTS.
The Credit Parties will furnish, or cause to be furnished, to the
Administrative Agent:
(a) ANNUAL FINANCIAL STATEMENTS. As soon as available, and in any event
within 105 days after the close of each fiscal year of the Consolidated Parties,
a consolidated balance sheet of the Consolidated Parties as of the end of such
fiscal year, together with related consolidated statements of income and cash
flows for such fiscal year, in each case setting forth in comparative form
consolidated figures for the preceding fiscal year, all such financial
information described above to be in reasonable form and detail and audited by
PricewaterhouseCoopers LLP (or by any of Deloitte and Touche, Ernst and Young or
KPMG Peat Marwick) or any other independent certified public accountants of
recognized national standing reasonably acceptable to the Administrative Agent
and whose opinion shall be to the effect that such financial statements have
been prepared in accordance with GAAP (except for changes with which such
accountants concur) and shall not be limited as to the scope of the audit or
qualified as to the status of the Consolidated Parties as a going concern or any
other material qualifications or exceptions.
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available, and in any
event within 45 days (105 days in the case of the last fiscal quarter) after the
close of each fiscal quarter of each fiscal year of the Consolidated Parties, a
consolidated balance sheet of the Consolidated Parties as of the end of such
fiscal quarter, together with related consolidated statements of income and cash
flows for such fiscal quarter, in each case setting forth in comparative form
consolidated figures for the corresponding period of the preceding fiscal year,
all such financial information described above to be in reasonable form and
detail and reasonably acceptable to the Administrative Agent, and accompanied by
a certificate of an Executive Officer of the Borrower to the effect that such
quarterly financial statements fairly present in all material respects the
financial condition of the Consolidated Parties and have been prepared in
accordance with GAAP, subject to changes resulting from audit and normal
year-end audit adjustments and the absence of certain footnotes.
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(c) OFFICER'S CERTIFICATE. At the time of delivery of the financial
statements provided for in Sections 7.1(a) and 7.1(b) above, a certificate of an
Executive Officer of the Borrower substantially in the form of Exhibit 7.1(c),
(i) providing a detailed calculation of Consolidated EBITDA (with a break-out of
each of the components of the definition thereof set forth in Section 1.1) for
the applicable fiscal period, (ii) demonstrating compliance with the financial
covenants contained in Section 7.10 by calculation thereof as of the end of the
applicable fiscal period and (iii) stating that no Default or Event of Default
exists as of the end of the applicable fiscal period, or if any Default or Event
of Default does exist, specifying the nature and extent thereof and what action
the Credit Parties propose to take with respect thereto.
(d) ANNUAL BUSINESS PLAN AND BUDGETS. Within 45 days after the end of
each fiscal year of the Borrower an annual business plan and budget of the
Consolidated Parties containing, among other things, projected financial
statements for the next fiscal year; provided that the first such plan shall not
be required to be delivered until August 13, 2003 for the 2004 fiscal year
starting June 29, 2003.
(e) COMPLIANCE WITH CERTAIN PROVISIONS OF THE CREDIT AGREEMENT. Within
105 days after the end of each fiscal year of the Credit Parties, a certificate
(i) providing a detailed calculation of Excess Cash Flow (with a break-out of
each of the components of the definition thereof set forth in Section 1.1) and
(ii) containing information regarding the amount of all Asset Dispositions, Debt
Issuances and Equity Issuances that were made during the prior fiscal year.
(f) ACCOUNTANT'S CERTIFICATE. Within the period for delivery of the
annual financial statements provided in Section 7.1(a), a certificate of the
accountants conducting the annual audit stating that they have reviewed this
Credit Agreement as it relates to accounting matters and stating further
whether, in the course of their audit, they have become aware of any Default or
Event of Default with respect to such accounting matters and, if any such
Default or Event of Default exists, specifying the nature and extent thereof,
provided that such accountants shall not incur any liability to the Lenders by
reason of any failure to obtain knowledge of any such Default or Event of
Default that would not be disclosed in the course of their audit examination.
(g) REPORTS. Promptly upon transmission or receipt thereof, (i) copies
of any filings and registrations with, and reports to or from, the Securities
and Exchange Commission, or any successor agency, and copies of all financial
statements, proxy statements, notices and reports as any Consolidated Party
shall send to its shareholders generally or to a holder of any Indebtedness owed
by any Consolidated Party in its capacity as such a holder and (ii) upon the
reasonable request of the Administrative Agent, all written reports and written
information to and from the United States Environmental Protection Agency, or
any state or local agency responsible for environmental matters, the United
States Occupational Health and Safety Administration, or any state or local
agency responsible for health and safety matters, or any successor agencies or
authorities concerning environmental, health or safety matters.
(h) NOTICES. Upon any Executive Officer of a Credit Party obtaining
knowledge thereof, the Credit Parties will give written notice to the
Administrative Agent immediately of (i) the occurrence of an event or condition
consisting of a Default or Event of
84
Default, specifying the nature and existence thereof and what action the Credit
Parties propose to take with respect thereto, and (ii) the occurrence of any of
the following with respect to any Consolidated Party (A) the pendency or
commencement of any litigation, arbitral or governmental proceeding against such
Person which is reasonably likely to have a Material Adverse Effect, (B) the
institution of any proceedings against such Person with respect to, or the
receipt of notice by such Person of potential liability or responsibility for
violation, or alleged violation of any Federal, state or local law, rule or
regulation, including but not limited to, Environmental Laws, where such
liability or the violation of which could reasonably be expected to have a
Material Adverse Effect or (C) the receipt by any Consolidated Party of notice
from any regulatory agency or authority having jurisdiction in the matter
regarding a material investigation of any of such Person under PACA.
(i) ERISA. Upon any Executive Officer of a Credit Party obtaining
knowledge thereof, the Credit Parties will give written notice to the
Administrative Agent promptly (and in any event within thirty Business Days) of
any of the following which could reasonably be expected to have a Material
Adverse Effect: (i) any event or condition, including, but not limited to, any
Reportable Event, that constitutes, or might reasonably lead to, an ERISA Event;
(ii) with respect to any Multiemployer Plan, the receipt of notice as prescribed
in ERISA or otherwise of any withdrawal liability assessed against the Credit
Parties or any ERISA Affiliates, or of a determination that any Multiemployer
Plan is in reorganization or insolvent (both within the meaning of Title IV of
ERISA); (iii) the failure to make full payment on or before the due date
(including extensions) thereof of all amounts which any Consolidated Party or
any ERISA Affiliate is required to contribute to each Plan pursuant to its terms
and as required to meet the minimum funding standard set forth in ERISA and the
Code with respect thereto; or (iv) any change in the funding status of any Plan
as of the end of the applicable Plan year that could have a Material Adverse
Effect, together with a description of any such event or condition or a copy of
any such notice and a statement by an Executive Officer of the Borrower briefly
setting forth the details regarding such event, condition, or notice, and the
action, if any, which has been or is being taken or is proposed to be taken by
the Credit Parties with respect thereto. Promptly upon request, the Credit
Parties shall furnish the Administrative Agent and the Lenders with such
additional information concerning any Plan as may be reasonably requested,
including, but not limited to, copies of each annual report/return (Form 5500
series), as well as all schedules and attachments thereto required to be filed
with the Department of Labor and/or the Internal Revenue Service pursuant to
ERISA and the Code, respectively, for each "plan year" (within the meaning of
Section 3(39) of ERISA).
(j) ENVIRONMENTAL. Upon the reasonable written request of the
Administrative Agent following the occurrence of any event or the discovery of
any condition which the Administrative Agent or the Required Lenders reasonably
believe(s) has caused (or could cause) the representations and warranties set
forth in Section 6.16 to be untrue, the Credit Parties will furnish or cause to
be furnished to the Administrative Agent, at the Credit Parties' expense, a
report of an environmental assessment of reasonable scope, form and depth,
(including, where appropriate, invasive soil or groundwater sampling) by a
consultant reasonably acceptable to the Administrative Agent as to the subject
matter of such possible breach. If the Credit Parties fail to deliver such an
environmental report within seventy-five (75) days after receipt of such written
request then the Administrative Agent may arrange for same, and the Consolidated
Parties hereby grant to the Administrative Agent and their representatives
85
reasonable access to the Real Properties to reasonably undertake such an
assessment (including, where appropriate, invasive soil or groundwater
sampling). The reasonable cost of any assessment requested by the Administrative
Agent pursuant to this provision will be payable by the Credit Parties on demand
and added to the obligations secured by the Collateral Documents.
(k) ADDITIONAL PATENTS AND TRADEMARKS. At the time of delivery of the
financial statements and reports provided for in Section 7.1(a), a report signed
by an Executive Officer of the Borrower setting forth (i) a list of registration
numbers for all federally registered Intellectual Property awarded to any Credit
Party since the last day of the immediately preceding fiscal year and (ii) a
list of all applications for federal registration of the Intellectual Property
submitted by any Credit Party to the U.S. Patent and Trademark Office or the
U.S. Copyright Office since the last day of the immediately preceding fiscal
year and the status of each such application, all in such form as shall be
reasonably satisfactory to the Administrative Agent.
(l) OTHER INFORMATION. With reasonable promptness upon any such
request, such other information regarding the business, properties or financial
condition of any Consolidated Party as the Administrative Agent or the Required
Lenders may reasonably request.
7.2. PRESERVATION OF EXISTENCE AND FRANCHISES.
Except as a result of or in connection with a dissolution, merger or
disposition of a Subsidiary not prohibited by Section 8.4 or Section 8.5, each
Credit Party will, and will cause each of its Subsidiaries to, do all things
necessary to preserve and keep in full force and effect its existence, rights,
franchises except where the failure to do so could not reasonably be expected to
have a Material Adverse Effect.
7.3. BOOKS AND RECORDS.
Each Credit Party will, and will cause each of its Subsidiaries to,
keep complete and accurate books and records of its transactions in accordance
with good accounting practices on the basis of GAAP (including the establishment
and maintenance of appropriate reserves).
7.4. 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 (including PACA, the Food Security Act, the FFDCA, all other
applicable federal and state laws governing the production of food, and all
applicable regulations and administrative interpretations promulgated under any
such laws) imposed by all Governmental Authorities, applicable to it and its
Property to the extent that noncompliance with any such law, rule, regulation,
order or restriction could reasonably be expected to have a Material Adverse
Effect.
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7.5. PAYMENT OF TAXES AND OTHER CLAIMS.
Each Credit Party will, and will cause each of its Subsidiaries to, pay
and discharge (a) all material taxes, assessments and governmental charges or
levies imposed upon it, or upon its income or profits, or upon any of its
properties, before they shall become delinquent and (b) all material lawful
claims (including claims for labor, materials and supplies) which, if unpaid,
might give rise to a Lien upon any of its properties (other than a Permitted
Lien); provided, however, that no Consolidated Party shall be required to pay
any such tax, assessment, charge, levy or claim which (i) is being contested in
good faith by appropriate proceedings and as to which adequate reserves therefor
have been established in accordance with GAAP, unless the failure to make any
such payment could give rise to an immediate right to foreclose on a Lien
securing such amounts or (ii) could reasonably be expected to have a Material
Adverse Effect.
7.6. INSURANCE.
(a) Each Credit Party will, and will cause each of its Subsidiaries to,
at all times maintain in full force and effect insurance (including worker's
compensation insurance, liability insurance, casualty insurance and business
interruption insurance) in such amounts, covering such risks and liabilities and
with such deductibles or self-insurance retentions as are in accordance with
customary industry practice. 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 amended or
cancelled. The insurance coverage of the Consolidated Parties as of the Closing
Date is outlined as to carrier, policy number, expiration date, type and amount
on Schedule 7.6.
(b) In the event that the Consolidated Parties receive Net Cash
Proceeds from property damage or casualty insurance in excess of $1,000,000 in
aggregate amount during any fiscal year of the Consolidated Parties ("EXCESS
PROCEEDS") on account of Involuntary Dispositions, the Credit Parties shall,
within the period of 540 days following the date of receipt of such Excess
Proceeds, either (i) prepay the Loans (and cash collateralize the LOC
Obligations) in accordance with the terms of Section 3.3(b)(iii)(B) or (ii)
apply (or cause to be applied) an amount equal to such Excess Proceeds to make
Eligible Reinvestments (including but not limited to the repair or replacement
of the related Property); provided, however, that such Consolidated Party need
not repair or replace the Property of such Consolidated Party so lost, damaged
or destroyed to the extent the failure to make such repair or replacement (i) is
desirable to the proper conduct of the business of such Consolidated Party and
otherwise in the best interest of such Consolidated Party; and (ii) would not
materially impair the rights and benefits of the Administrative Agent or the
Lenders under the Collateral Documents or any other Credit Document.
Notwithstanding the foregoing, no Consolidated Party shall undertake replacement
or restoration of any such Property having a net book value in excess of
$10,000,000 unless, after giving pro forma effect to any Funded Indebtedness to
be incurred in connection with such replacement or restoration, the Credit
Parties would be in compliance with the financial covenants set forth in Section
7.10(a) and Section 7.10(b) as of the most recent fiscal quarter end preceding
the date of determination with respect to which the Administrative Agent has
received
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the Required Financial Information (assuming, for purposes hereof, that
such Funded Indebtedness was incurred as of the first day of the four
fiscal-quarter period ending as of such fiscal quarter end). All property damage
or casualty insurance proceeds shall be subject to the security interest of the
Administrative Agent (for the ratable benefit of the Lenders) under the
Collateral Documents. Pending final application of any Excess Proceeds, the
Credit Parties may apply such Excess Proceeds to temporarily reduce the
Revolving Loans or to make Permitted Investments.
7.7. MAINTENANCE OF PROPERTY.
Each Credit Party will, and will cause each of its Subsidiaries to,
maintain and preserve its properties and equipment material to the conduct of
its business in good repair, working order and condition, normal wear and tear
and Involuntary Disposition excepted, and will make, or cause to be made, in
such properties and equipment from time to time all repairs, renewals,
replacements, extensions, additions, betterments and improvements thereto as may
reasonably be needed or proper, to the extent and in the manner customary for
companies in similar businesses and to the extent necessary in the reasonable
business judgment of such Person.
7.8. USE OF PROCEEDS.
The Borrower will use the proceeds of the Loans and will use the
Letters of Credit solely for the purposes set forth in Section 6.15.
7.9. AUDITS/INSPECTIONS.
Upon reasonable notice and during normal business hours, each Credit
Party will, and will cause each of its Subsidiaries to, permit representatives
appointed by the Administrative Agent, including, without limitation,
independent accountants, agents, attorneys, and appraisers to visit and inspect
its property, including its books and records to the extent allowed by
applicable law and regulation, its accounts receivable and inventory, its
facilities and its other business assets, and to make photocopies thereof and to
write down and record any information such representative obtains and shall
permit the Administrative Agent or its representatives to investigate and verify
the accuracy of information provided to the Lenders and to discuss all such
matters with the officers, employees and representatives of such Person;
provided, however, that, unless an Event of Default shall exist, the
Administrative Agent shall not exercise its rights under this sentence more
often than two times during any calendar year and only one such time shall be at
the Credit Parties' expense. Notwithstanding the foregoing, no material
protected by an attorney-client privilege shall be required to be disclosed
pursuant to this Section 7.9; provided, however, that, in the event that any
Credit Party claims that any materials requested for review, investigation or
discussion by the Administrative Agent or any of its representatives pursuant to
this Section 7.9 is protected by an attorney-client privilege, then such Credit
Party shall (i) provide the Administrative Agent with a reasonably acceptable
basis for the assertion of the privilege, (ii) remove or redact only those
portions of the related materials deemed to be privileged and (iii) in good
faith cooperate with the Administrative Agent to determine a method by which the
information which the Administrative Agent deems necessary to review,
88
investigate or discuss may be obtained by the Administrative Agent in an
alternative manner which will not jeopardize any attorney-client privilege.
7.10. FINANCIAL COVENANTS.
(a) CONSOLIDATED LEVERAGE RATIO. The Consolidated Leverage Ratio, as of
the last day of each fiscal quarter of the Consolidated Parties set forth below,
shall be less than or equal to:
Period Consolidated Leverage Ratio
------ ---------------------------
9/30/02 5.25 to 1.00
12/31/02 5.25 to 1.00
3/31/03 5.25 to 1.00
6/30/03 5.25 to 1.00
------- ------------
9/30/03 5.25 to 1.00
12/31/03 5.25 to 1.00
3/31/04 5.00 to 1.00
6/30/04 5.00 to 1.00
------- ------------
9/30/04 5.00 to 1.00
12/31/04 5.00 to 1.00
3/31/05 4.75 to 1.00
6/30/05 4.75 to 1.00
------- ------------
9/30/05 4.50 to 1.00
12/31/05 4.50 to 1.00
3/31/06 4.25 to 1.00
6/30/06 4.25 to 1.00
------- ------------
9/30/06 4.00 to 1.00
12/31/06 4.00 to 1.00
3/31/07 3.75 to 1.00
6/30/07 3.75 to 1.00
------- ------------
9/30/07 3.50 to 1.00
12/31/07 3.50 to 1.00
3/31/08 3.50 to 1.00
6/30/08 3.50 to 1.00
------- ------------
(b) CONSOLIDATED SENIOR LEVERAGE RATIO. The Consolidated Senior
Leverage Ratio, as of the last day of each fiscal quarter of the Consolidated
Parties set forth below, shall be less than or equal to:
Consolidated Senior
Period Leverage Ratio
------ --------------
9/30/02 3.50 to 1.00
12/31/02 3.50 to 1.00
3/31/03 3.50 to 1.00
6/30/03 3.50 to 1.00
------- ------------
9/30/03 3.50 to 1.00
12/31/03 3.50 to 1.00
3/31/04 3.25 to 1.00
6/30/04 3.25 to 1.00
------- ------------
9/30/04 3.25 to 1.00
12/31/04 3.25 to 1.00
3/31/05 3.00 to 1.00
6/30/05 3.00 to 1.00
------- ------------
89
Consolidated Senior
Period Leverage Ratio
------ --------------
9/30/05 2.75 to 1.00
12/31/05 2.75 to 1.00
3/31/06 2.50 to 1.00
6/30/06 2.50 to 1.00
------- ------------
9/30/06 2.25 to 1.00
12/31/06 2.25 to 1.00
3/31/07 2.00 to 1.00
6/30/07 2.00 to 1.00
------- ------------
9/30/07 1.75 to 1.00
12/31/07 1.75 to 1.00
3/31/08 1.75 to 1.00
6/30/08 1.75 to 1.00
------- ------------
(c) INTEREST COVERAGE RATIO. The Interest Coverage Ratio, as of the
last day of each fiscal quarter of the Consolidated Parties set forth below,
shall be greater than or equal to:
Period Interest Coverage Ratio
------ -----------------------
9/30/02 2.00 to 1.00
12/31/02 2.00 to 1.00
3/31/03 2.00 to 1.00
6/30/03 2.00 to 1.00
------- ------------
9/30/03 2.00 to 1.00
12/31/03 2.00 to 1.00
3/31/04 2.10 to 1.00
6/30/04 2.10 to 1.00
------- ------------
9/30/04 2.10 to 1.00
12/31/04 2.10 to 1.00
3/31/05 2.15 to 1.00
6/30/05 2.15 to 1.00
------- ------------
9/30/05 2.20 to 1.00
12/31/05 2.20 to 1.00
3/31/06 2.25 to 1.00
6/30/06 2.25 to 1.00
------- ------------
9/30/06 2.30 to 1.00
12/31/06 2.30 to 1.00
3/31/07 2.35 to 1.00
6/30/07 2.35 to 1.00
------- ------------
9/30/07 2.50 to 1.00
12/31/07 2.50 to 1.00
3/31/08 2.50 to 1.00
6/30/08 2.50 to 1.00
------- ------------
7.11. ADDITIONAL GUARANTORS.
As soon as practicable and in any event within 30 days after (a) any
Person becomes a direct or indirect Material Domestic Subsidiary of the Parent
or (b) any direct or indirect Subsidiary of the Parent guarantees the Borrower's
obligations under any Junior Financing Documentation, the Credit Parties shall
(i) provide the Administrative Agent with written notice thereof and shall cause
such Person to execute a Joinder Agreement in substantially the same form as
Exhibit 7.11, (ii) deliver such other documentation as the
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Administrative Agent may reasonably request in connection with the foregoing,
including, without limitation, customary favorable opinions of counsel to such
Person (which shall cover, among other things, the legality, validity, binding
effect and enforceability of the Joinder Agreement) and other items of the types
required to be delivered pursuant to Section 5.1(b), all in form, content and
scope reasonably satisfactory to the Administrative Agent and (iii) otherwise
comply with Section 7.12 in respect of such Person.
7.12. PLEDGED ASSETS.
Each Credit Party will (i) cause all of its owned real and personal
Property and shall use commercially reasonable efforts to cause all of its
leased real and personal Property, in each case, other than Excluded Property to
be subject at all times to first priority, perfected and, in the case of real
Property (whether leased or owned), title insured Liens in favor of the
Administrative Agent to secure the Credit Party Obligations pursuant to the
terms and conditions of the Collateral Documents or, with respect to any such
Property acquired subsequent to the Closing Date, such other additional security
documents as the Administrative Agent shall reasonably request, subject in any
case to Permitted Liens and (ii) deliver such other documentation as the
Administrative Agent may reasonably request in connection with the foregoing,
including, without limitation, appropriate UCC-1 financing statements, real
estate title insurance policies, surveys, environmental reports, landlord's
waivers, certified resolutions and other organizational and authorizing
documents of such Person, customary favorable opinions of counsel to such Person
(which shall cover, among other things, the legality, validity, binding effect
and enforceability of the documentation referred to above and the perfection of
the Administrative Agent's liens thereunder) and other items of the types
required to be delivered pursuant to Section 5.1(d) and (e), all in form,
content and scope reasonably satisfactory to the Administrative Agent. Without
limiting the generality of the above, the Credit Parties will cause
(A) 100% of the issued and outstanding Capital Stock of the
Borrower;
(B) 100% of the issued and outstanding Capital Stock of each
Domestic Subsidiary owned by the Credit Parties; and
(C) 65% (or such greater percentage that, due to a change in an
applicable Requirement of Law after the date hereof, (1)
could not reasonably be expected to cause the undistributed
earnings of such Material Foreign Subsidiary as determined
for United States federal income tax purposes to be treated
as a deemed dividend to such Material Foreign Subsidiary's
United States parent and (2) could not reasonably be
expected to cause any material adverse tax consequences) of
the issued and outstanding Capital Stock entitled to vote
(within the meaning of Treas. Reg. Section 1.956-2(c)(2))
and 100% of the issued and outstanding Capital Stock not
entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2)) owned by the Credit Parties in each Material
Foreign Subsidiary;
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to be delivered to the Administrative Agent (together with undated stock powers
signed in blank (unless, with respect to a Material Foreign Subsidiary, such
stock powers are deemed unnecessary by the Administrative Agent in its
reasonable discretion under the law of the jurisdiction of incorporation of such
Person)) and pledged to the Administrative Agent pursuant to an appropriate
pledge agreement(s) in substantially the form of the Pledge Agreement and
otherwise in form reasonably acceptable to the Administrative Agent.
Notwithstanding the foregoing, the Credit Parties shall not be required
to grant mortgages on (i) real property located in the State of New York owned
by the Credit Parties unless requested by the Administrative Agent or the
Required Lenders or (ii) the property located at 00000 X-00 Xxxxxxx, Xxxxxx
Xxxxxxxx until all existing mortgages thereon have been released.
7.13. INTEREST RATE PROTECTION.
The Credit Parties shall cause the Borrower to maintain protection
against fluctuations in interest rates until the second anniversary date of the
Closing Date pursuant to one or more interest rate protection agreements
reasonably satisfactory to the Administrative Agent and providing coverage in a
notional amount, together with the amount of Funded Indebtedness of the
Consolidated Parties on a consolidated basis that is bearing interest at a fixed
rate, at least equal to 40% of the aggregate amount of all Funded Indebtedness
of the Consolidated Parties on a consolidated basis on the Closing Date other
than Revolving Loans (it being agreed that the existing interest rate protection
agreements currently in place satisfy this covenant to the extent they remain
outstanding).
7.14. FURTHER ASSURANCES.
To the extent not delivered on the Closing Date, the Borrower shall
deliver to the Administrative Agent within 90 days after the Closing Date such
documents, instruments and other items of the types required to be delivered
pursuant to Section 5.1(e) with respect to the Real Property identified as item
[ ] on subpart (1) of Schedule 6.20(a).
SECTION VIII
NEGATIVE COVENANTS
Each Credit Party hereby covenants and agrees that until such time as
the Credit Agreement has been terminated in accordance with the terms of Section
11.13:
8.1. INDEBTEDNESS.
The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Indebtedness, except:
(a) Indebtedness arising under this Credit Agreement and the other
Credit Documents;
92
(b) Indebtedness of the Borrower and its Subsidiaries set forth in
Schedule 8.1 (and renewals, refinancings and extensions thereof on terms and
conditions no less favorable to such Person than such existing Indebtedness);
(c) purchase money Indebtedness (including obligations in respect of
Capital Leases, Synthetic Leases and mortgage, industrial revenue bond,
industrial development bond and similar financings) hereafter incurred by the
Borrower or any of its Subsidiaries to finance the purchase, repair or
improvement of capital assets and real property or assumed or acquired by any of
the Consolidated Parties in connection with a Permitted Investment, provided
that (i) the total of all such Indebtedness for all such Persons taken together
shall not exceed an aggregate principal amount of $20,000,000 at any one time
outstanding; (ii) unless non-recourse to the Consolidated Parties, such
Indebtedness when incurred shall not exceed the purchase price of the asset(s)
financed; and (iii) no such Indebtedness shall be refinanced for a principal
amount in excess of the principal balance outstanding thereon at the time of
such refinancing;
(d) obligations of any Consolidated Party in respect of Hedging
Agreements entered into in order to manage existing or anticipated interest
rate, exchange rate or commodity pricing risks and not for speculative purposes;
(e) Guaranty Obligations and intercompany Indebtedness permitted under
Section 8.6 and Section 8.7;
(f) Indebtedness consisting of (i) the 11 7/8% Senior Subordinated
Notes and (ii) any refinancing thereof with subordinated notes (the "Senior
Subordinated Refinancing Notes") issued by the Borrower; provided that (A) the
Borrower shall have delivered to the Administrative Agent a Pro Forma Compliance
Certificate demonstrating that, upon giving effect on a Pro Forma Basis to such
transaction, the Credit Parties would be in compliance with the financial
covenants set forth in Section 7.10(a) and (b), (B) the subordination provisions
of any such Senior Subordinated Refinancing Notes are at least as favorable to
the Lenders as those contained in the 11 7/8% Senior Subordinated Notes and the
covenants in the Senior Subordinated Refinancing Indenture permit the Credit
Facilities and guarantees and collateral security therefor and (C) the amount
thereof (including any accumulated, pay-in-kind or capitalized interest),
together with all Qualified Preferred Stock and Subordinated Debt outstanding
pursuant to paragraph (o) below, does not exceed $275,000,000;
(g) Indebtedness of Foreign Subsidiaries in an aggregate principal
amount at any time outstanding for all such Persons taken together not exceeding
the greater of (i) the Foreign Borrowing Base as of the date of such incurrence
or (ii) $20,000,000;
(h) Indebtedness representing deferred compensation to directors,
former directors, employees or former employees of the Consolidated Parties;
(i) Unsecured Indebtedness consisting of promissory notes issued by the
Parent or the Borrower to current or former officers, directors and employees,
their respective estates, spouses or former spouses to finance the purchase or
redemption of Capital Stock of the Parent or Holdings LLC, provided that the
aggregate principal amount of such Indebtedness incurred in any fiscal year
shall not exceed $2,000,000;
93
(j) Indebtedness evidenced by the Subordinated Notes issued under (i)
the 12 1/4% Senior Subordinated Indenture in an aggregate principal amount less
than $25,000 at any one time outstanding and (ii) Indebtedness evidenced by the
GLK Note;
(k) Indebtedness incurred by any Consolidated Party in connection with
Permitted Acquisitions or Permitted Asset Dispositions under agreements
providing for indemnification, adjustment of purchase price or similar
obligations, or from guarantees or letters of credit, surety bonds or
performance bonds securing the performance of such Credit Party pursuant to such
agreements;
(l) Indebtedness consisting of obligations of any Consolidated Party
under incentive, non-compete, consulting, deferred compensation or other similar
arrangements incurred by such Person in connection with the Transaction and
Permitted Acquisitions;
(m) Indebtedness incurred in connection with the financing of insurance
premiums;
(n) Indebtedness in respect of netting services, overdraft protections
and similar arrangements in each case in connection with deposit accounts;
(o) Qualified Preferred Stock and/or Subordinated Debt in an aggregate
liquidation preference (including any accretion or accumulated or pay-in-kind
dividends thereon) and/or principal amount not to exceed (i) $275,000,000 less
(ii) the outstanding principal amount of all Subordinated Debt outstanding under
clause (f) above (including any accumulated, pay-in-kind or capitalized interest
thereon);
(p) Qualified Preferred Stock and/or Subordinated Debt so long as the
Net Cash Proceeds thereof are concurrently applied to the prepayment of the
Loans in accordance with Sections 3.3(b)(iv) and (v);
(q) to the extent constituting Indebtedness, obligations incurred in
respect of Liens permitted under Section 8.2(e); and
(r) other Indebtedness in the aggregate principal amount for all
Consolidated Parties not to exceed $20,000,000 at any time outstanding.
8.2. LIENS.
The Credit Parties will not permit any Consolidated Party to contract,
create, incur, assume or permit to exist any Lien with respect to any of its
Property, whether now owned or hereafter acquired, except for:
(a) Liens in favor of the Administrative Agent to secure the Credit
Party Obligations;
(b) Liens existing as of the Closing Date and set forth on Schedule
8.2; provided that no such Lien shall at any time be extended to or cover any
Property other than the Property subject thereto on the Closing Date;
94
(c) Liens (other than Liens created or imposed under ERISA) for taxes,
assessments or governmental charges or levies not yet delinquent or Liens for
taxes being contested in good faith by appropriate proceedings for which
adequate reserves determined in accordance with GAAP have been established (and
as to which the Property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof) or not otherwise required to be
paid under Section 7.5;
(d) statutory and contractual Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and suppliers and other Liens imposed by
law or pursuant to customary reservations or retentions of title arising in the
ordinary course of business, provided that such Liens (i) secure only amounts
not overdue by more than 30 days or (ii) if more than 30 days overdue, are
unfiled and no other action has been taken to enforce the same or are being
contested in good faith by appropriate proceedings for which adequate reserves
determined in accordance with GAAP have been established (and as to which the
Property subject to any such Lien is not yet subject to foreclosure, sale or
loss on account thereof) or not otherwise required to be paid under Section 7.5;
(e) Liens (other than Liens created or imposed under ERISA) incurred or
deposits made by any Consolidated Party in the ordinary course of business in
connection with workers' compensation, unemployment insurance and other types of
social security, or to secure the performance of tenders, statutory obligations,
bids, leases, government contracts, performance, surety, appeal and
return-of-money bonds and other similar obligations (exclusive of obligations
for the payment of borrowed money);
(f) Liens in connection with attachments or judgments (including
judgment or appeal bonds) provided that either (i) the judgments secured shall,
within 30 days after the entry thereof, have been discharged or execution
thereof stayed pending appeal, or shall have been discharged within 30 days
after the expiration of any such stay or (ii) the judgments secured thereby do
not constitute an Event of Default under Section 9.1(h);
(g) easements, rights-of-way, covenants, restrictions (including zoning
and building code restrictions), minor defects or irregularities in title and
other similar charges or encumbrances not, in any material respect, impairing
the use of the encumbered Property for its intended purposes;
(h) Liens on Property of any Person securing purchase money
Indebtedness (including obligations in respect of Capital Leases, Synthetic
Leases and mortgage, industrial revenue bond, industrial development bond and
similar financings) of such Person permitted under Section 8.1(c), provided that
any such Lien attaches to such Property concurrently with or within 90 days
after the acquisition, repair, replacement or improvement (as applicable)
thereof;
(i) leases, licenses, subleases or sublicenses granted to others not
interfering in any material respect with the business of any Consolidated Party;
(j) any interest or title of a lessor, licensor, sublessor or
sublicensor under, and Liens arising from UCC financing statements (or
equivalent filings, registrations or
95
agreements in foreign jurisdictions) relating to, leases or licenses not
prohibited by this Credit Agreement;
(k) Liens in favor of customs and revenue authorities arising as a
matter of law to secure payment of customs duties in connection with the
importation of goods;
(l) Liens deemed to exist in connection with Investments in repurchase
agreements permitted under Section 8.6;
(m) normal and customary rights of setoff upon deposits of cash in
favor of banks or other depository institutions;
(n) Liens of a collection bank arising under Section 4-210 of the
Uniform Commercial Code on items in the course of collection;
(o) Liens arising from operation of the statutory trust under PACA or
similar laws, provided that such Liens do not secure past due account payable
balances exceeding $10,000,000 in the aggregate at any one time outstanding,
unless, in respect of any such account payables, (i) appropriate legal or
administrative action has been commenced and is being diligently pursued or
defended by the applicable Consolidated Party and (ii) the ability of the
applicable vendor to enforce any such Lien provided under PACA or similar laws
has been stayed or otherwise legally prohibited during the pendency of such
action;
(p) Liens on "farm products" (as defined in the Food Security Act) to
the extent, in the case of any such Lien, that such Lien (i) was created by the
Person (but not a Consolidated Party) which sold such Property to the applicable
Consolidated Party and (ii) follows the Property by reason of the provisions of
the Food Security Act notwithstanding the transfer of title to such Property to
such Consolidated Party;
(q) Liens of sellers of goods to the Borrower and any of its
Subsidiaries arising under Article 2 of the Uniform Commercial Code or similar
provisions of applicable law in the ordinary course of business, covering only
the goods sold and securing only the unpaid purchase price for such goods and
related expenses;
(r) Liens on Property of any Foreign Subsidiary securing Indebtedness
of such Foreign Subsidiary to the extent permitted under Section 8.1(g);
(s) Liens in favor of sellers of Property attaching solely to xxxx
xxxxxxx money deposits in connection with any letter of intent or purchase
agreement in connection with a Permitted Acquisition;
(t) Liens arising from precautionary UCC financing statements regarding
consignments;
(u) Liens on insurance policies and the proceeds thereof to the extent
securing the financing of the premium payment with respect thereto and to the
extent such payment is not delinquent;
96
(v) Liens encumbering customary initial deposits and margin deposits,
and similar Liens and margin deposits, and similar Liens attaching to commodity
trading accounts or other brokerage accounts incurred in the ordinary course of
business;
(w) Liens in favor of financial institutions securing reimbursement
obligations in respect of documentary letters of credit or bankers' acceptances;
provided that such Liens attach only to the goods covered thereby and the
proceeds thereof;
(x) any interest of title of a purchaser under, and Liens arising from
UCC financing statements relating to, any sale of accounts receivable in
connection with the compromise thereof;
(y) Liens consisting of an agreement to sell, transfer or dispose of
Property pursuant to a Permitted Asset Disposition; and
(z) other Liens not described above, provided that such Liens do not
secure obligations in excess of $20,000,000 at any one time outstanding.
8.3. NATURE OF BUSINESS.
The Credit Parties will not permit any Consolidated Party to
substantively alter the character or conduct of the business conducted by such
Person as of the Closing Date, except for reasonable extensions thereof and
businesses ancillary or complementary thereto.
8.4. CONSOLIDATION, MERGER, DISSOLUTION, ETC.
Except in connection with a Permitted Asset Disposition, the Credit
Parties will not permit any Consolidated Party to enter into any transaction of
merger or consolidation or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution); provided that, notwithstanding the foregoing
provisions of this Section 8.4 but subject to the terms of Sections 7.11 and
7.12, (a) the Borrower may merge or consolidate with any of its Subsidiaries
provided that the Borrower shall be the continuing or surviving corporation, (b)
subject to the preceding clause (a), any Credit Party (other than the Parent or
the Borrower) may merge or consolidate with any other Credit Party (other than
the Parent or the Borrower), (c) any Consolidated Party which is not a Credit
Party may be merged or consolidated with or into any Credit Party other than the
Parent provided that such Credit Party shall be the continuing or surviving
corporation, (d) any Consolidated Party which is not a Credit Party may be
merged or consolidated with or into any other Consolidated Party which is not a
Credit Party, (e) any Subsidiary of the Borrower may merge with any Person that
is not a Credit Party in connection with an Asset Disposition permitted under
Section 8.5, (f) the Borrower or any Subsidiary of the Borrower may merge with
any Person other than a Consolidated Party in connection with an Acquisition
permitted hereunder provided that, if such transaction involves the Borrower,
the Borrower shall be the continuing or surviving corporation and (g) any
Subsidiary of the Borrower may dissolve, liquidate or wind up its affairs at any
time provided that such dissolution, liquidation or winding up, as applicable,
could not have a Material Adverse Effect; provided further that notwithstanding
anything to the contrary in this Section 8.4, the Borrower may enter into a
transaction or series of transactions of merger solely for the purpose of
changing its state of incorporation from the State of New York to the State of
Delaware; provided that the surviving
97
entity of such transaction or series of related transactions shall enter into an
instrument of assumption in form and substance reasonably satisfactory to the
Administrative Agent pursuant to which it shall have assumed the obligations of
the Borrower under the Credit Documents and shall have provided such legal
opinions and other documentation as the Administrative Agent may reasonably
request in connection therewith.
8.5. ASSET DISPOSITIONS.
The Credit Parties will not permit any Consolidated Party to make any
Asset Disposition other than an Excluded Asset Disposition unless (a) at least
75% of the consideration paid in connection therewith (excluding the assumption
by the purchaser of liabilities associated with such disposed Property) is cash
or Cash Equivalents (except as provided in clause (d) below) and shall be in an
amount not less than the fair market value of the Property disposed of, (b) if
such transaction is a Sale and Leaseback Transaction, such transaction is not
prohibited by the terms of Section 8.13, (c) such transaction does not involve a
sale or other disposition of receivables other than receivables owned by or
attributable to other Property concurrently being disposed of in a transaction
otherwise permitted under this Section 8.5, (d) (1) if the consideration for
such Asset Disposition is 100% cash (excluding the assumption by the purchaser
of liabilities associated with such Property) the aggregate assets sold or
otherwise disposed of by the Consolidated Parties in all such transactions after
the Closing Date shall have contributed in the aggregate no more than an amount
equal to the EBITDA Disposition Limit of Consolidated EBITDA for the respective
twelve-month periods prior to the date on which such assets were disposed of,
with contribution to Consolidated EBITDA being separately calculated for each
such Asset Disposition or series of related Asset Dispositions for the
respective twelve-month period preceding each such Asset Disposition or series
of Asset Dispositions, and (2) if the consideration for such Asset Disposition
is not 100% cash, as aforesaid, the aggregate net book value of the asset sold
or otherwise disposed of by the Consolidated Parties shall not exceed
$70,000,000 (and of such amount assets having a net book value of up to
$20,000,000 may be sold or otherwise disposed of for consideration consisting of
less than 75% cash and Cash Equivalents), (e) if the net book value of the
Property subject to such Asset Disposition exceeds $5,000,000, the Borrower
shall have delivered to the Administrative Agent (i) a Pro Forma Compliance
Certificate demonstrating that, upon giving effect on a Pro Forma Basis to such
transaction, the Credit Parties would be in compliance with the financial
covenants set forth in Section 7.10(a) and (b) and (ii) a certificate of an
Executive Officer of the Borrower specifying the anticipated date of such Asset
Disposition, briefly describing the assets to be sold or otherwise disposed of
and setting forth the net book value of such assets, the aggregate consideration
and a reasonable estimate of the Net Cash Proceeds to be received for such
assets in connection with such Asset Disposition, (f) the Credit Parties shall
apply (or cause to be applied) an amount equal to the Net Cash Proceeds of such
Asset Disposition to (i) make Eligible Reinvestments or (ii) prepay the Loans
(and cash collateralize LOC Obligations) in accordance with the terms of Section
3.3(b)(iii)(A) and (g) such Asset Disposition is not prohibited by any Junior
Financing Documentation. Pending final application of the Net Cash Proceeds of
any Asset Disposition, the Consolidated Parties may apply such Net Cash Proceeds
to temporarily reduce the Revolving Loans or to make Investments in Cash
Equivalents.
Upon a sale of assets or the sale of Capital Stock of a Consolidated
Party permitted by this Section 8.5, such Collateral automatically shall be
released from the Liens
98
created by the Credit Documents and the Administrative Agent shall (to the
extent applicable) deliver to the Credit Parties, upon the Credit Parties'
request and at the Credit Parties' expense, such documentation as is reasonably
necessary to evidence the release of the Administrative Agent's security
interest, if any, in such assets or Capital Stock, including, without
limitation, amendments or terminations of UCC financing statements, if any, the
return of stock certificates, if any, and, provided that such Consolidated Party
is released from all of its obligations, if any, under any Junior Financing
Documentation, the release of such Consolidated Party from all of its
obligations, if any, under the Credit Documents.
8.6. INVESTMENTS.
The Credit Parties will not permit any Consolidated Party to make any
Investments, except for:
(a) Investments consisting of cash and Cash Equivalents;
(b) Investments consisting of accounts receivable created, acquired or
made by any Consolidated Party in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms;
(c) Investments consisting of Capital Stock, obligations, securities or
other property received by any Consolidated Party (i) in settlement of accounts
receivable (created in the ordinary course of business) from bankrupt or
insolvent obligors or disputes with customers and (ii) as partial consideration
for a Permitted Asset Disposition;
(d) Investments existing as of the Closing Date and set forth in
Schedule 8.6;
(e) Investments consisting of advances or loans to directors, officers,
employees, agents, customers or suppliers that do not exceed $3,500,000 in the
aggregate at any one time outstanding;
(f) Investments in any Credit Party (other than the Parent) and
Investments by Consolidated Parties which are not Credit Parties in other
Consolidated Parties;
(g) to the extent not required at such time to prepay the Loans
pursuant to Section 3.3(b), any Eligible Reinvestment of the Net Cash Proceeds
of (i) any Involuntary Disposition as contemplated by Section 7.6(b), (ii) any
Asset Disposition as contemplated by Section 8.5(f) or (iii) any Equity
Issuance;
(h) Investments consisting of an Acquisition by the Borrower or any
Subsidiary of the Borrower, provided that (i) the Property acquired (or the
Property of the Person acquired) in such Acquisition is used or useful in the
same or a similar line of business as the Borrower and its Subsidiaries were
engaged in on the Closing Date (and any reasonable extensions or expansions
thereof or businesses ancillary or complementary thereto), (ii) the
Administrative Agent shall have received all items in respect of the Capital
Stock or Property acquired in such Acquisition required to be delivered by the
terms of Section 7.11 and/or Section 7.12, (iii) in the case of an Acquisition
of the Capital Stock of another Person, the board of directors (or other
comparable governing body) of such other Person shall have duly approved
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such Acquisition, (iv) the Borrower shall have delivered to the Administrative
Agent (A) a Pro Forma Compliance Certificate demonstrating that, upon giving
effect to such Acquisition on a Pro Forma Basis, the Credit Parties would be in
compliance with the financial covenants set forth in Section 7.10(a) and (b) and
(B) a certificate of an Executive Officer of the Borrower (1) demonstrating
that, upon giving effect to such Acquisition, at least 90% of Consolidated
EBITDA for the most recently ended fiscal year period for each of the
Consolidated Parties and the acquired Person or Property preceding the date of
such Acquisition with respect to which the Administrative Agent shall have
received the Required Financial Information has been audited in accordance with
GAAP, in the case of the Consolidated Parties, as required by Section 7.1(a)
and, in the case of the acquired Person or Property, by independent certified
public accountants of recognized national standing reasonably acceptable to the
Administrative Agent (whose opinion shall not be limited as to the scope or
qualified as to going concern status or any other material qualifications or
exceptions) and (2) to the extent that audited financial information for the
acquired Person or Property is required under the terms of the foregoing clause
(1), certifying that the quarterly financial statements with respect to the
Person or Property acquired for each fiscal quarter period ending after the date
of the last audit and immediately prior to the date of such Acquisition have
been prepared in accordance with GAAP (subject to audit adjustments and the
absence of footnotes) and reviewed by independent certified public accountants
of recognized national standing reasonably acceptable to the Administrative
Agent, (v) the representations and warranties made by the Credit Parties in
Section 6 shall be true and correct in all material respects at and as if made
as of the date of such Acquisition (after giving effect thereto) except to the
extent such representations and warranties expressly relate to an earlier date,
(vi) if such transaction involves the purchase of an interest in a partnership
between the Borrower as a general partner and entities unaffiliated with the
Borrower as the other partners, such transaction shall be effected by having
such equity interest acquired by a corporate holding company directly or
indirectly wholly-owned by the Borrower newly formed for the sole purpose of
effecting such transaction, (vii) after giving effect to such Acquisition, (A)
the Revolving Committed Amount minus the monthly average amount of the sum of
the aggregate outstanding principal amount of Revolving Loans plus LOC
Obligations plus Swingline Loans for the twelve-month period (or shorter period
beginning with the Closing Date) ended as of such date shall be at least
$25,000,000 and (B) the pro forma Consolidated Leverage Ratio (including any
adjustments for cost savings as a result of such Acquisition but only to the
extent such adjustments would be permitted in accordance with Regulation S-X)
shall be less than or equal to a ratio equal to the lesser of (1) the
Consolidated Leverage Ratio at such time before giving effect to such
Acquisition and (2) 4.75 to 1:0 and (viii) the aggregate consideration
(including cash and non-cash consideration and any assumption of Indebtedness,
but excluding consideration consisting of (A) any Capital Stock of the Parent
issued to the seller of the Capital Stock or Property acquired in such
Acquisition, (B) consideration consisting of the Net Cash Proceeds of the
issuance of Subordinated Debt, (C) to the extent not required at such time to
prepay the Loans pursuant to Section 3.3(b), consideration consisting of the Net
Cash Proceeds of Indebtedness incurred pursuant to Section 8.1(other than
Section 8.1(a)) and (D) to the extent not required at such time to prepay the
Loans pursuant to Section 3.3(b), consideration consisting of the Net Cash
Proceeds of any Equity Issuance by the Parent consummated subsequent to the
Closing Date and the Net Cash Proceeds of any Asset Disposition (other than an
Asset Dispositions of the type described in clauses (i), (viii) and (ix) of the
definition of "Excluded Asset Disposition") or Involuntary Disposition
consummated subsequent to the Closing Date)
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paid by the Consolidated Parties for all such Acquisitions occurring after the
Closing Date shall not exceed $100,000,000 (it being understood that (i) the
acquisition by the Borrower of all or any portion of the Capital Stock of GLK
not currently owned by the Borrower shall be permitted if the Borrower complies
with clauses (ii) through (v) and (vii) hereof as if such acquisition(s) were an
Acquisition hereunder and (ii) the consideration paid by the Borrower for such
Capital Stock shall not reduce the amount of Acquisitions permitted by this
paragraph;
(i) Investments consisting of endorsements for collection or deposit in
the ordinary course of business;
(j) to the extent constituting Investments, (i) Guaranty Obligations
permitted by Section 8.1(e), (ii) Permitted Liens and (iii) transactions
permitted by Section 8.4;
(k) Investments consisting of customary trade arrangements with
customers in the ordinary course of business and consistent with past practices;
(l) Investments by the Parent consisting of obligations of directors
and/or employees of any Consolidated Party in connection with such Person's
purchase of Capital Stock in the Parent or Holdings LLC;
(m) Investments made with the portion of Excess Cash Flow not required
to prepay the Loans in accordance with Section 3.3(b)(ii);
(n) to the extent constituting Investments, the licensing or
contribution of Intellectual Property pursuant to joint marketing arrangements
with Persons other than Consolidated Parties;
(o) Investments consisting of advances or loans (i) to the Parent in
lieu of, and not exceeding the aggregate amount of, Restricted Payments to the
Parent permitted under Section 8.7 and (ii) to Holdings LLC in lieu of, and not
exceeding the aggregate amount of, Restricted Payments to Holdings LLC permitted
under Section 8.7(j);
(p) other Investments not listed above (including, without limitation,
Investments in Foreign Subsidiaries and Joint Ventures) in an aggregate net
amount not to exceed $80,000,000 at any one time; provided, however, that, to
the extent that any such Investment (or series of related Investments) made
pursuant to this clause (p) consists of the contribution(s) or other transfer(s)
of Property (other than cash) having an aggregate net book value in excess of
$5,000,000 to a Joint Venture for consideration less than the fair market value
of such Property, then the Borrower shall have delivered to the Administrative
Agent a Pro Forma Compliance Certificate demonstrating that, upon giving effect
on a Pro Forma Basis to such Investment(s), the Credit Parties would be in
compliance with the financial covenants set forth in Section 7.10(a) and (b);
(q) to the extent constituting Investments, the transactions permitted
by clauses (j) and (k) of Section 8.9; and
(r) Investments consisting of advances or loans to GLK in an amount not
to exceed an aggregate principal amount of $12,500,000 outstanding at any time.
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8.7. RESTRICTED PAYMENTS. The Credit Parties will not permit any
Consolidated Party to, directly or indirectly, declare, order, make or set apart
any sum for or pay any Restricted Payment, except (a) Restricted Payments by any
Consolidated Party which is not a Credit Party to any other Consolidated Party,
(b) to the extent constituting Restricted Payments, transactions permitted by
Section 8.1(f), (h), (i), (j), (l), (o), (p) or (r), Section 8.4, Section 8.8 or
Section 8.9, (c) Restricted Payments by any Consolidated Parties to the Parent
for its proportionate share of the tax liability of the affiliated group of
corporations that file consolidated federal income tax returns (or that file
state or local income tax returns on a consolidated basis), (d) Restricted
Payments made on the Closing Date to consummate the Transaction pursuant to the
Unit Purchase Agreement and thereafter to satisfy required payments under
Section 6.27 of the Unit Purchase Agreement, (e) scheduled payments of
Subordinated Debt or Qualified Preferred Stock not in violation of the
subordination provisions contained in the applicable Junior Financing
Documentation, (f) Restricted Payments by any Consolidated Party to the Parent
not to exceed an amount necessary to permit the Parent to pay its costs
(including all professional fees and expenses) incurred to comply with its
reporting obligations under federal or state laws or in connection with
reporting or other obligations under this Credit Agreement and the Credit
Documents, (g) Restricted Payments made to repurchase and redeem all or any
portion of (i) the 12 1/4% Senior Subordinated Notes and/or (ii) the GLK Note
(or accreted amount plus accrued interest); provided that, in the case of this
clause (ii), after giving effect thereto, the Consolidated Leverage Ratio
determined on a Pro Forma Basis as demonstrated by a Pro Forma Compliance
Certificate delivered by the Borrower to the Administrative Agent is no greater
than the maximum ratio permitted by Section 7.10(a) at such time, (h) Restricted
Payments by any Consolidated Party to the Parent not to exceed an amount
necessary to permit the Parent to pay its interim expenses incurred in
connection with any public offering of equity securities the net proceeds of
which are specifically intended to be received by or contributed or loaned to
the Borrower, which, unless such offering shall have been terminated by the
board of directors of the Parent, shall be repaid to the Borrower promptly out
of the proceeds of such offering, (i) Restricted Payments by any Consolidated
Party to the Parent to pay for corporate, administrative and operating expenses
(including, without limitation, insurance of the Parent) in the ordinary course
of business and in an amount not to exceed the amount necessary for the Parent
to make scheduled payments of Subordinated Debt and Qualified Preferred Stock
issued by it to the extent permitted by clause (e) above, (j) Restricted
Payments by any Consolidated Party to Holdings LLC to pay for (1) corporate,
administrative and operating expenses, in the ordinary course of business
relating to the Consolidated Parties, in an amount not to exceed $1,000,000 per
fiscal year and (2) directors' and officers' insurance for the Consolidated
Parties, (k) repurchases by the Parent of its Capital Stock (and Restricted
Payments by the Borrower and/or the Parent) to the extent necessary to enable
the Parent to repurchase Capital Stock (or to make payments on any promissory
note issued to repurchase such Capital Stock) from a former or current employee
or director (and/or such employee's or director's estate, spouse and/or former
spouse) of the Parent or any of its Subsidiaries in connection with the
termination of such employee's employment or resignation from the Board of
Directors; provided that such Restricted Payments shall not exceed $2,000,000 in
cash during any fiscal year plus (1) the unused amount available pursuant to
this clause (k) for such Restricted Payments from any previous year and (2) the
proceeds of any key-man life insurance maintained by and received by the Parent
or any of its Subsidiaries, (l) repurchase of Capital Stock of the Parent deemed
to occur upon the non-cash exercise of stock options and warrants, (m)
Restricted
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Payments made with the Net Cash Proceeds of Equity Issuances of the Parent which
are not required to be applied to the prepayment of the Loans pursuant to
Section 3.3(b)(v), including, without limitation, to repurchase or redeem the
11 7/8% Senior Subordinated Notes, (n) refinancings of the Subordinated Debt
permitted by Section 8.1 and Section 8.8 and (o) to the extent constituting
Restricted Payments, the loans and payments permitted by clauses (i), (j) and
(k) of Section 8.9.
8.8. OTHER INDEBTEDNESS.
The Credit Parties will not permit any Consolidated Party to (a) if any
Default or Event of Default has occurred and is continuing or would be directly
or indirectly caused as a result thereof, after the issuance thereof, amend or
modify any of the terms of any Indebtedness of such Consolidated Party if such
amendment or modification would add or change any terms in a manner adverse to
such Consolidated Party, 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 make (or give any notice with
respect thereto) any voluntary or optional payment or prepayment or redemption
or acquisition for value 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 other
Indebtedness of such Consolidated Party, other than in connection with the
refinancing, repayment or retirement of any such Indebtedness with Capital Stock
or the Net Cash Proceeds from an Equity Issuance which are not required to
prepay the Loans pursuant to Section 3.3(b)(v), (b) after the issuance thereof,
amend or modify any of the terms of any Junior Financing Documentation if such
amendment or modification would (i) change the subordination provisions in a
manner less favorable to the Lenders than the Subordinated Debt Indenture for
the 11 7/8% Senior Subordinated Notes, (ii) shorten the final maturity or
average life to maturity thereof or require any payment to be made sooner than
originally scheduled or (iii) not permit the Credit Facilities or guarantees or
collateral security therefor, (c) make interest payments in respect of any
Subordinated Debt or Qualified Preferred Stock in violation of the subordination
provisions of the applicable Junior Financing Documentation or (d) 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, (i) subject to the terms
of clause (a) above, for the exchange of the Subordinated Notes for notes with
identical terms registered pursuant to the registration rights agreement set
forth in the applicable Subordinated Debt Indenture, (ii) the refinancing,
repayment or retirement of any Subordinated Debt with Capital Stock or the Net
Cash Proceeds from Equity Issuances which are not required to prepay the Loans
pursuant to Section 3.3(b)(v) and (iii) as permitted by Section 8.1(f) and
clause (g) of Section 8.7. Notwithstanding the foregoing, the Credit Parties may
refinance Subordinated Debt to the extent permitted by Sections 8.1(f), (o) and
(p) with other Subordinated Debt or Qualified Preferred Stock, as permitted, and
(r) and Sections 8.7(g), (m) and (n) and may repay or repurchase the GLK Note as
permitted by Section 8.7(g).
8.9. TRANSACTIONS WITH AFFILIATES.
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The Credit Parties will not permit any Consolidated Party to enter into
or permit to exist any transaction or series of transactions with any officer,
director, Subsidiary or Affiliate of such Person other than (a) advances of
working capital to any Credit Party other than the Parent, (b) transfers of cash
and assets to any Credit Party other than the Parent, (c) transactions expressly
permitted by Section 8.1, Section 8.4, Section 8.5, Section 8.6 or Section 8.7,
(d) normal compensation, indemnification and reimbursement of expenses of
officers, employees and directors, (e) the payment of fees and expenses in
connection with the Transaction as contemplated by the Unit Purchase Agreement,
the Credit Documents and the Subordinated Debt, (f) the payment of fees and
reimbursement of expenses to the Equity Investors and any indemnities in
connection with the Transaction, (g) the transactions set forth on Schedule 8.9,
(h) Equity Issuances to Affiliates, (i) (A) the payment by the Borrower of up to
$10,000,000 per fiscal year (not to exceed $50,000,000 in the aggregate) plus
any interest thereon for prior payments not made when scheduled to Pro-Fac to
the extent required by the Purchase Related Agreements (the "PRO-FAC PAYMENT"),
provided that, after giving effect thereto, no Default or Event of Default then
exists and (B) a payment to Pro-Fac of up to $2,500,000 in the first year
following the Closing Date related to tax payments for fiscal 2002 (the "PRO-FAC
TAX PAYMENT"), (j) loans by the Borrower to Pro-Fac of up to $1,000,000 per
fiscal year (not to exceed $5,000,000 in the aggregate); provided that, after
giving effect thereto, no Default or Event of Default then exists, (k) loans by
the Borrower to GLK expressly permitted by Section 8.6(r), and (l) except as
otherwise specifically limited in this Credit Agreement, other transactions
which are entered into in the ordinary course of such Person's business on terms
and conditions substantially as favorable to such Person as would be obtainable
by it in a comparable arms-length transaction with a Person other than an
officer, director, shareholder, Subsidiary or Affiliate.
8.10. FISCAL YEAR; ORGANIZATIONAL DOCUMENTS AND OTHERS.
The Credit Parties will not permit any Consolidated Party to (a) amend,
modify or change (i) its articles of incorporation (or other similar
organizational document) or bylaws (or other similar documents) other than to
effect a change in jurisdiction of organization in accordance with Section 8.4;
provide that the Parent or the Borrower may amend its articles of incorporation
(or other similar organizational documents) in order to create and issue
Qualified Preferred Stock permitted pursuant to Section 8.1, (ii) the Unit
Purchase Agreement or (iii) the Purchase Related Agreements, in any case under
clauses (i) through (iii) in a manner materially adverse to the rights of the
Lenders or (b) change its fiscal year, provided that the Borrower may change its
fiscal year with the prior written approval of the Administrative Agent, which
consent shall not to be unreasonably withheld.
8.11. LIMITATION ON RESTRICTED ACTIONS.
The Credit Parties will not permit any Consolidated Party 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 Property (other than Capital Stock in Joint Ventures) to any
Credit Party, or (e) act as a Credit Party and
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pledge its Property (other than Capital Stock in Joint Ventures) pursuant to and
in accordance with 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 Credit Agreement and the
other Credit Documents, (ii) the Subordinated Debt Indentures and Subordinated
Notes, as in effect as of the Closing Date, (iii) applicable law or regulation,
(iv) any document or instrument governing Indebtedness permitted under Section
8.1, provided that the encumbrances and restrictions relating to any
Consolidated Party in such document or instrument are no more restrictive than
the corresponding encumbrances and restrictions contained in the Credit
Documents, (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, (vii) customary
restrictions and conditions contained in any agreement relating to the sale of
any Property permitted under Section 8.5 pending the consummation of such sale,
(viii) customary non-assignment provisions in contracts or (ix) agreements
entered into by Foreign Subsidiaries.
8.12. OWNERSHIP OF SUBSIDIARIES.
Notwithstanding any other provisions of this Credit Agreement to the
contrary, the Credit Parties will not (i) permit the Credit Parties (other than
the Parent which shall be required to own 100% of the Borrower) to own directly
less than 90% of the Voting Stock of any of the Domestic Subsidiaries except as
a result of or in connection with a dissolution, merger, consolidation or
disposition of a Subsidiary not prohibited by Section 8.4 or Section 8.5, (ii)
permit the Credit Parties to own directly or indirectly less than 90% of the
Voting Stock of any of the Foreign Subsidiaries except (A) to qualify directors
where required by applicable law or to satisfy other requirements of applicable
law with respect to the ownership of Capital Stock of Foreign Subsidiaries or
(B) as a result of or in connection with a dissolution, merger, consolidation or
disposition of a Subsidiary not prohibited by Section 8.4 or Section 8.5, (iii)
except as permitted by Section 8.6, permit any Subsidiary of the Borrower to
issue or have outstanding any shares of preferred Capital Stock other than
Qualified Preferred Stock or (iv) create, incur, assume or suffer to exist any
Lien on any Capital Stock of any Subsidiary of the Borrower required to be
pledged to the Administrative Agent pursuant to the terms of Section 7.12,
except for Permitted Liens.
8.13. SALE LEASEBACKS.
The Credit Parties will not permit any Consolidated Party to enter into
any Sale and Leaseback Transaction; provided, however, the Borrower and its
Subsidiaries may enter into Sale and Leaseback Transactions so long as the fair
market value of all Properties subject to such transactions occurring on or
after the Closing Date does not exceed $25,000,000.
8.14. NO FURTHER NEGATIVE PLEDGES.
The Credit Parties will not permit any Consolidated Party to enter
into, assume or become subject to any agreement prohibiting or otherwise
restricting the existence of any Lien upon any of its Property in favor of the
Administrative Agent (for the benefit of the Lenders) for the purpose of
securing the Credit Party Obligations, whether now owned or hereafter acquired,
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or requiring the grant of any security for any obligation if such Property is
given as security for the Credit Party Obligations, except (a) in connection
with any document or instrument governing Indebtedness incurred pursuant to
Section 8.1(c), provided that any such restriction contained therein relates
only to the asset or assets constructed or acquired in connection therewith, (b)
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, (c) pursuant to
customary restrictions and conditions contained in any agreement relating to any
Permitted Asset Disposition, pending the consummation of such sale, (d)
customary non-assignment provisions in contracts, (e) the documentation
governing or evidencing the Subordinated Notes, (f) agreements entered into by
to Foreign Subsidiaries or (g) Property consisting of Capital Stock in Joint
Ventures.
8.15. CAPITAL EXPENDITURES.
The Credit Parties will not make or commit to make any Consolidated
Capital Expenditure except Consolidated Capital Expenditures of the Borrower and
its Subsidiaries not exceeding $35,000,000 per fiscal year, provided that, to
the extent Consolidated Capital Expenditures made in any particular fiscal year
are less than $35,000,000, the amount of such difference (the "CapEx Rollover")
may be carried forward and spent in the next succeeding fiscal year.
8.16. HOLDING COMPANY STATUS OF PARENT.
The Credit Parties will not permit the Parent to engage in any business
activities other than maintaining its corporate existence and owning the stock
of the Borrower.
SECTION IX
EVENTS OF DEFAULT
9.1. EVENTS OF DEFAULT.
An Event of Default shall exist upon the occurrence and during the
continuance of any of the following specified events (each an "EVENT OF
DEFAULT"):
(a) PAYMENT. Any Credit Party shall
(i) default in the payment when due of any principal of any of the
Loans or of any reimbursement obligations arising from drawings under Letters of
Credit, or
(ii) default, and such default shall continue for three (3) or more
Business Days, in the payment when due of any interest on the Loans or of any
interest on reimbursement obligations arising from drawings under Letters of
Credit, or of any Fees or other amounts owing hereunder, under any of the other
Credit Documents or in connection herewith or therewith; or
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(b) REPRESENTATIONS. Any representation, warranty or statement made
or deemed to be made by any Credit Party herein, in any of the other Credit
Documents, or in any statement or certificate delivered or required to be
delivered pursuant hereto or thereto shall prove untrue in any material respect
on the date as of which it was deemed to have been made; or
(c) COVENANTS. Any Credit Party shall
(i) default in the due performance or observance of any term,
covenant or agreement contained in Sections 7.2 (with respect to
corporate existence), 7.8, 7.10, 7.11 or 7.12 or Section 8; or
(ii) default in the due performance or observance by it of any
term, covenant or agreement (other than those referred to in
subsections (a), (b) or (c)(i) of this Section 9.1) contained in this
Credit Agreement or any other Credit Document and such default shall
continue unremedied for a period of at least 30 days after notice
thereof by the Administrative Agent; or
(d) OTHER CREDIT DOCUMENTS. Except as a result of or in connection
with a dissolution, merger or disposition of a Subsidiary not prohibited by
Section 8.4 or Section 8.5, any Credit Document shall fail to be in full force
and effect (other than in accordance with its terms) or to give the
Administrative Agent and/or the Lenders the Liens, material rights, powers and
privileges purported to be created thereby, or any Credit Party shall so state
in writing; or
(e) GUARANTIES. Except as the result of or in connection with a
dissolution, merger or disposition of a Subsidiary not prohibited by Section 8.4
or Section 8.5, the guaranty given by any Guarantor hereunder (including any
Person after the Closing Date in accordance with Section 7.11) or any provision
thereof shall cease to be in full force and effect, or any Guarantor (including
any Person after the Closing Date in accordance with Section 7.11) hereunder or
any Person acting by or on behalf of such Guarantor shall deny or disaffirm such
Guarantor's obligations under such guaranty, or any Guarantor shall default
(beyond any applicable grace period) in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed pursuant to
any guaranty; or
(f) BANKRUPTCY, ETC. Any Bankruptcy Event shall occur with respect
to any Consolidated Party other than any non-Material Domestic Subsidiary; or
(g) DEFAULTS UNDER OTHER INDEBTEDNESS. With respect to any
Indebtedness (other than Indebtedness outstanding under this Credit Agreement)
in excess of $10,000,000 in the aggregate principal amount for the Consolidated
Parties taken as a whole, (A) either (1) default in any payment shall occur and
continue (beyond the applicable grace period with respect thereto, if any) with
respect to any such Indebtedness (other than as a result of subordination
provisions invoked by the Lenders), or (2) a default in the observance or
performance relating to such Indebtedness or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event or
condition shall occur or exist, the effect of which default or other event or
condition is to cause, or permit, the holder or holders of such Indebtedness (or
trustee or agent on behalf of such holders) to cause, any such Indebtedness
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to become due prior to its stated maturity; or (B) any such Indebtedness shall
be declared due and payable, or required to be prepaid other than by a regularly
scheduled required prepayment, prior to the stated maturity thereof; or
(h) JUDGMENTS. One or more judgments or decrees shall be entered
against one or more of the Consolidated Parties involving a liability of
$10,000,000 or more in the aggregate (to the extent not paid or covered by
insurance or indemnity provided by a carrier or indemnitor who has not
disclaimed coverage and has the ability to perform) and any such judgments or
decrees shall not have been paid, vacated, discharged or stayed or bonded
pending appeal within 60 days from the entry thereof; or
(i) ERISA. Any of the following events or conditions, if such event
or condition could reasonably be expected to result in liability that would have
a Material Adverse Effect: (i) any "accumulated funding deficiency," as such
term is defined in Section 302 of ERISA and Section 412 of the Code, whether or
not waived, shall exist with respect to any Plan, or any lien shall arise on the
assets of any Consolidated Party or any ERISA Affiliate in favor of the PBGC or
a Plan; (ii) an ERISA Event shall occur with respect to a Single Employer Plan,
which is, in the reasonable opinion of the Administrative Agent, likely to
result in the termination of such Plan for purposes of Title IV of ERISA; (iii)
an ERISA Event shall occur with respect to a Multiemployer Plan or Multiple
Employer Plan, which is, in the reasonable opinion of the Administrative Agent,
likely to result in (A) the termination of such Plan for purposes of Title IV of
ERISA, or (B) any Consolidated Party or any ERISA Affiliate incurring any
liability in connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency (within the meaning of Section
4245 of ERISA) of such Plan; or (iv) any prohibited transaction (within the
meaning of Section 406 of ERISA or Section 4975 of the Code) or breach of
fiduciary responsibility shall occur which may subject any Consolidated Party or
any ERISA Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
of ERISA or Section 4975 of the Code, or under any agreement or other instrument
pursuant to which any Consolidated Party or any ERISA Affiliate has agreed or is
required to indemnify any person against any such liability; or
(j) SUBORDINATED FINANCINGS. (i) There shall occur and be
continuing any "Event of Default" (or any comparable term) under, and as defined
in, any Junior Financing Documentation, (ii) any of the Credit Party Obligations
for any reason shall cease to be "Designated Senior Debt" (or any comparable
term) under, and as defined in, any Junior Financing Documentation (other than
the GLK Note), (iii) any Indebtedness other than the Credit Party Obligations
shall constitute "Designated Senior Debt" (or any comparable term) under, and as
defined in, any Junior Financing Documentation or (iv) the subordination
provisions set forth in Article 10 and Section 11.03 of the Subordinated Debt
Indenture for the 11 7/8% Senior Subordinated Notes (or comparable provisions in
any other Junior Financing Documentation) shall, in whole or in part, terminate,
cease to be effective or cease to be legally valid, binding and enforceable
against any holder of the applicable Subordinated Debt or Qualified Preferred
Stock (other than in accordance with their respective terms); or
(k) OWNERSHIP. There shall occur a Change of Control.
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9.2. ACCELERATION; REMEDIES. Upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent, upon the request
and direction of the Required Lenders, shall, by written notice to the Credit
Parties take any of the following actions:
(a) TERMINATION OF COMMITMENTS. Declare the Commitments terminated
whereupon the Commitments shall be immediately terminated.
(b) ACCELERATION. Declare the Credit Party Obligations to be due and
payable, whereupon the same shall be immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby waived by the Credit Parties.
(c) CASH COLLATERAL. Direct the Borrower to pay (and the Borrower
hereby promises to pay, upon receipt of such notice) to the Administrative Agent
additional cash, to be held by the Administrative Agent, for the benefit of the
Lenders, in a cash collateral account as additional security for the LOC
Obligations in respect of subsequent drawings under all then outstanding Letters
of Credit in an amount equal to the maximum aggregate amount which may be drawn
under all Letters of Credits then outstanding.
(d) ENFORCEMENT OF RIGHTS. Enforce any and all rights and interests
created and existing under the Credit Documents including, without limitation,
all rights and remedies existing under the Collateral Documents, all rights and
remedies against a Guarantor and all rights of set-off.
Notwithstanding the foregoing, if an Event of Default specified in
Section 9.1(f) shall occur with respect to the Borrower, then, without the
giving of any notice or other action by the Administrative Agent or the Lenders,
(i) the Commitments automatically shall terminate, (ii) all of the outstanding
Credit Party Obligations automatically shall immediately become due and payable
and (iii) the Borrower automatically shall be obligated (and hereby promises) to
pay to the Administrative Agent additional cash, to be held by the
Administrative Agent, for the benefit of the Lenders, in a cash collateral
account as additional security for the LOC Obligations in respect of subsequent
drawings under all then outstanding Letters of Credit in an amount equal to the
maximum aggregate amount which may be drawn under all Letters of Credits then
outstanding.
SECTION X
AGENCY PROVISIONS
10.1. APPOINTMENT, POWERS AND IMMUNITIES.
(a) Each Lender hereby irrevocably appoints and authorizes the
Administrative Agent to act as its agent under this Credit Agreement and the
other Credit Documents with such powers and discretion as are specifically
delegated to the Administrative Agent by the terms of this Credit Agreement and
the other Credit Documents, together with such other powers as are reasonably
incidental thereto. The Administrative Agent (which term as used in this
sentence and
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in Section 10.5 and the first sentence of Section 10.6 hereof shall include its
Affiliates and its own and its Affiliates' officers, directors, employees, and
agents): (i) shall not have any duties or responsibilities except those
expressly set forth in this Credit Agreement and shall not be a trustee or
fiduciary for any Lender; (ii) shall not be responsible to the Lenders for any
recital, statement, representation, or warranty (whether written or oral) made
in or in connection with any Credit Document or any certificate or other
document referred to or provided for in, or received by any of them under, any
Credit Document, or for the value, validity, effectiveness, genuineness,
enforceability, or sufficiency of any Credit Document, or any other document
referred to or provided for therein or for any failure by any Credit Party or
any other Person to perform any of its obligations thereunder; (iii) shall not
be responsible for or have any duty to ascertain, inquire into, or verify the
performance or observance of any covenants or agreements by any Credit Party or
the satisfaction of any condition or to inspect the Property (including the
books and records) of any Credit Party or any of its Subsidiaries or Affiliates;
and (iv) shall not be responsible for any action taken or omitted to be taken by
it under or in connection with any Credit Document, except to the extent that
the taking of such action or omission is found by a final and nonappealable
decision of a court of competent jurisdiction to constitute its own gross
negligence, bad faith or willful misconduct. The Administrative Agent may employ
agents and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. The Issuing Lender shall act on behalf of the Lenders with
respect to any Letters of Credit issued by it and the documents associated
therewith until such time (and except for so long) as the Administrative Agent
may agree at the request of the Required Lenders to act for the Issuing Lender
with respect thereto; provided, however, that the Issuing Lender shall have all
of the benefits and immunities (i) provided to the Administrative Agent in this
Section 10 with respect to any acts taken or omissions suffered by the Issuing
Lender in connection with Letters of Credit issued by it or proposed to be
issued by it and the application and agreements for letters of credit pertaining
to the Letters of Credit as fully as if the term "Administrative Agent" as used
in this Section 10 included the Issuing Lender with respect to such acts or
omissions, and (ii) as additionally provided herein with respect to the Issuing
Lender.
10.2. RELIANCE BY ADMINISTRATIVE AGENT.
The Administrative Agent shall be entitled to rely upon any
certification, notice, instrument, writing, or other communication (including,
without limitation, any thereof by telephone or telecopy) believed by it to be
genuine and correct and to have been signed, sent or made by or on behalf of the
proper Person or Persons, and upon advice and statements of legal counsel
(including counsel for any Credit Party or Lender), independent accountants, and
other experts selected by the Administrative Agent. The Administrative Agent may
deem and treat the payee of any Note as the holder thereof for all purposes
hereof unless and until the Administrative Agent receives and accepts an
Assignment and Acceptance executed in accordance with Section 11.3(b) hereof. As
to any matters not expressly provided for by this Credit Agreement, the
Administrative Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Required Lenders, and such instructions shall be binding on all of the
Lenders; provided, however, that the Administrative Agent shall not be required
to take any action that exposes the Administrative Agent to personal liability
or that is contrary to any Credit Document or applicable law or unless it shall
first be
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indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking any such action.
10.3. DEFAULTS.
The Administrative Agent shall not be deemed to have knowledge or
notice of the occurrence of a Default or Event of Default unless the
Administrative Agent has received written notice from a Lender or a Credit Party
specifying 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 of the occurrence of a Default or Event of Default, the Administrative
Agent shall give prompt notice thereof to the Lenders. The Administrative Agent
shall (subject to Section 10.2 hereof) take such action with respect to such
Default or Event of Default as shall reasonably be directed by the Required
Lenders (or such other Lenders as required by Section 11.6), provided 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 interest of the Lenders.
10.4. RIGHTS AS A LENDER.
With respect to its Commitment and the Loans made by it, JPMorgan Chase
Bank (and any successor acting as Administrative Agent) in its capacity as a
Lender hereunder shall have the same rights and powers hereunder as any other
Lender and may exercise the same as though it were not acting as the
Administrative Agent, and the term "Lender" or "Lenders" shall, unless the
context otherwise indicates, include the Administrative Agent in its individual
capacity. JPMorgan Chase Bank (and any successor acting as Administrative Agent)
and its Affiliates may (without having to account therefor to any Lender) accept
deposits from, lend money to, make investments in, provide services to, and
generally engage in any kind of lending, trust, or other business with any
Credit Party or any of its Subsidiaries or Affiliates as if it were not acting
as Administrative Agent, and JPMorgan Chase Bank (and any successor acting as
Administrative Agent) and its Affiliates may accept fees and other consideration
from any Credit Party or any of its Subsidiaries or Affiliates for services in
connection with this Credit Agreement or otherwise without having to account for
the same to the Lenders.
10.5. INDEMNIFICATION.
The Lenders agree to indemnify the Administrative Agent (to the extent
not reimbursed under Section 11.5 hereof, but without limiting the obligations
of the Credit Parties under such Section) ratably (in accordance with their
respective (i) Revolving Commitments (or, if the Revolving Commitments have been
terminated, the outstanding Revolving Loans and Participation Interests in
Letters of Credit (including the Participation Interests of the Issuing Lender
in Letters of Credit)) and (ii) outstanding Tranche B Term Loans (and
Participation Interests therein)) for, and hold the Administrative Agent
harmless from and against, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses (including
attorneys' fees), or disbursements of any kind and nature whatsoever that may be
imposed on, incurred by or asserted against the Administrative Agent (including
by any Lender) in any way relating to or arising out of any Credit Document or
the transactions contemplated
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thereby or any action taken or omitted by the Administrative Agent under any
Credit Document; provided that no Lender shall be liable for any of the
foregoing to the extent they arise from the gross negligence, bad faith or
willful misconduct of the Person to be indemnified. Without limitation of the
foregoing, each Lender agrees to reimburse the Administrative Agent promptly
upon demand for its ratable share of any costs or expenses payable by the Credit
Parties under Section 11.5, to the extent that the Administrative Agent is not
promptly reimbursed for such costs and expenses by the Credit Parties. The
agreements in this Section 10.5 shall survive the repayment of the Loans, LOC
Obligations and other obligations under the Credit Documents and the termination
of the Commitments hereunder.
10.6. NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS.
Each Lender agrees that it has, independently and without reliance on
the Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own credit analysis of the
Credit Parties and their Subsidiaries and decision to enter into this Credit
Agreement and 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
analysis and decisions in taking or not taking action under the Credit
Documents. Except for notices, reports, and other documents and information
expressly required to be furnished to the Lenders by the Administrative Agent
hereunder, the Administrative Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the affairs,
financial condition, or business of any Credit Party or any of its Subsidiaries
or Affiliates that may come into the possession of the Administrative Agent or
any of its Affiliates.
10.7. SUCCESSOR ADMINISTRATIVE AGENT.
The Administrative Agent may resign at any time by giving 90 days prior
notice thereof to the Lenders and the Credit Parties. Upon any such resignation,
the Required Lenders shall have the right with the consent of the Borrower (not
to be unreasonably withheld) to appoint a successor Administrative Agent. If no
successor Administrative Agent shall have been so appointed by the Required
Lenders and shall have accepted such appointment within thirty (30) days after
the retiring Administrative Agent's giving of notice of resignation, then the
retiring Administrative Agent may, on behalf of the Lenders, appoint a successor
Administrative Agent which shall be a commercial bank organized under the laws
of the United States having combined capital and surplus of at least
$100,000,000. Upon the acceptance of any appointment as Administrative Agent
hereunder by a successor, such successor shall thereupon succeed to and become
vested with all the rights, powers, discretion, privileges, and duties of the
retiring Administrative Agent, and the retiring Administrative Agent shall be
discharged from its duties and obligations hereunder. After any retiring
Administrative Agent's resignation hereunder as Administrative Agent, the
provisions of this Section 10 shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
Administrative Agent. If no successor administrative agent has accepted
appointment as Administrative Agent by the date which is thirty (30) days
following a retiring Administrative Agent's notice of resignation, the retiring
Administrative Agent's resignation shall nevertheless thereupon become
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effective and the Lenders shall perform all of the duties of the Administrative
Agent hereunder until such time, if any, as the Required Lenders appoint a
successor agent as provided for above.
10.8. SYNDICATION AGENT.
The Syndication Agent, in its capacity as such, shall have no rights,
powers, duties, liabilities, fiduciary relationships or obligations under this
Credit Agreement or any of the other Credit Documents.
10.9. CO-DOCUMENTATION AGENTS.
The Co-Documentation Agents, in their capacity as such, shall have no
rights, powers, duties, liabilities, fiduciary relationships or obligations
under this Credit Agreement or any of the other Credit Documents.
SECTION XI
MISCELLANEOUS
11.1. NOTICES.
Except as otherwise expressly provided herein, all notices and other
communications shall have been duly given and shall be effective (a) when
delivered, (b) when transmitted via telecopy (or other facsimile device) to the
number set out below, (c) the Business Day following the day on which the same
has been delivered prepaid (or pursuant to an invoice arrangement) to a
reputable national overnight air courier service, or (d) the third Business Day
following the day on which the same is sent by certified or registered mail,
postage prepaid, in each case to the respective parties at the address, in the
case of the Credit Parties and the Administrative Agent, set forth below, and,
in the case of the Lenders, set forth on Schedule 2.1(a), or at such other
address as such party may specify by written notice to the other parties hereto:
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if to any Credit Party:
Agrilink Foods, Inc.
00 Xxxxxx Xxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with copies to:
Vestar Capital Partners
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx X. Xxxxxx and General Counsel
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
and
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Administrative Agent in respect of Notices of
Borrowing, payments and prepayments:
JPMorgan Chase Bank
Xxx Xxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
if to the Administrative Agent in respect of all other
communications:
JPMorgan Chase & Co.
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
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in each case with a copy to:
JPMorgan Chase Bank
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attn: Xxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Notices and other communications to any Lender hereunder may be
delivered or furnished by electronic communications pursuant to procedures
approved by the Administrative Agent; provided that the foregoing shall not
apply to notices pursuant to Section 2 unless otherwise agreed by the
Administrative Agent and the applicable Lender. The Administrative Agent or the
Borrower may, in its discretion, agree to accept notices and other
communications to it hereunder by electronic communications pursuant to
procedures approved by it; provided that approval of such procedures may be
limited to particular notices or communications.
11.2. RIGHT OF SET-OFF; ADJUSTMENTS.
Upon the occurrence and during the continuance of any Event of Default
under Section 9.1(a), each Lender (and each of its Affiliates) is hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to set off and apply any and all deposits (general or special, time or
demand, provisional or final, other than payroll or trust accounts) at any time
held and other indebtedness at any time owing by such Lender (or any of its
Affiliates) to or for the credit or the account of any Credit Party against any
and all of the obligations of such Person then due and owing under this Credit
Agreement or under any other Credit Document, irrespective of whether such
Lender shall have made any demand hereunder or thereunder. Each Lender agrees
promptly to notify in writing any affected Credit Party after any such set-off
and application made by such Lender; provided, however, that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Lender under this Section 11.2 are in addition to other rights
and remedies (including, without limitation, other rights of set-off) that such
Lender may have.
11.3. BENEFIT OF AGREEMENT.
(a) The provisions of this Credit Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted hereby (including any Affiliate of the Issuing Bank that
issues any Letter of Credit), except that (i) the Borrower may not assign or
otherwise transfer any of its rights or obligations hereunder without the prior
written consent of each Lender (and any attempted assignment or transfer by the
Borrower without such consent shall be null and void) and (ii) no Lender may
assign or otherwise transfer its rights or obligations hereunder except in
accordance with this Section. Nothing in this Credit Agreement, expressed or
implied, shall be construed to confer upon any Person (other than the parties
hereto, their respective successors and assigns permitted hereby (including any
Affiliate of the Issuing Bank that issues any Letter of Credit), Participants
(to the extent provided in paragraph (c) of this Section) and, to the extent
expressly contemplated
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hereby, the Indemnified Parties) any legal or equitable right, remedy or claim
under or by reason of this Agreement.
(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below,
any Lender may assign to one or more Eligible Assignees all or a portion of its
rights and obligations under this Credit Agreement (including all or a portion
of its Commitment and the Loans at the time owing to it) with the prior written
consent (such consent not to be unreasonably withheld) of:
(A) the Borrower, provided that no consent of the Borrower
shall be required for an assignment to a Lender, an Affiliate of a Lender
or an Approved Fund; and
(B) the Administrative Agent, provided that no consent of the
Administrative Agent shall be required for an assignment to an assignee
that is a Lender, Affiliate of a Lender or an Approved Fund immediately
prior to giving effect to such assignment.
(ii) Assignments shall be subject to the following additional
conditions:
(A) except in the case of an assignment to a Lender, Affiliate
of a Lender, an Approved Fund or an assignment of the entire remaining
amount of the assigning Lender's and its Affiliates' or Approved Funds'
Commitment, the amount of the Commitment of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and
Acceptance with respect to such assignment is delivered to the
Administrative Agent) shall not be less than $5,000,000 in the case of
Revolving Commitments and $1,000,000 in the case of Tranche B Term Loans
unless each of the Borrower and the Administrative Agent otherwise consent;
(B) each partial assignment shall be made as an assignment of
a proportionate part of all the assigning Lender's rights and obligations
under this Agreement in respect of the applicable class of Commitments or
Loans; provided that this subsection shall not be construed to prohibit
assignment of a proportionate part of all the assigning Lender's rights and
obligations in respect of one class of Commitments or Loans;
(C) the parties to each assignment shall execute and deliver
to the Administrative Agent an Assignment and Acceptance, together with a
processing and recordation fee of $3,500;
(D) the assignee, if it shall not be a Lender, shall deliver
to the Administrative Agent an administrative questionnaire; and
(E) in the case of an assignment by a Lender to a CLO managed
by such Lender or an Affiliate of such Lender, unless such assignment (or
an assignment to a CLO managed by such Lender or an Affiliate of such
Lender) shall have been approved by the Borrower (the Borrower agreeing
that such an approval, if requested, will not be
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unreasonably withheld or delayed), the assigning Lender shall retain the
sole right to approve any amendment, modification or waiver of any
provision of this Agreement, provided that the Assignment and Acceptance
between such Lender and such CLO may provide that such Lender will not,
without the consent of such CLO, agree to any amendment, modification or
waiver described in the first proviso to Section 11.6(a) that affects such
CLO.
(iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) of this Section, from and after the effective date
specified in each Assignment and Acceptance the assignee thereunder shall
be a party hereto and, to the extent of the interest assigned by such
Assignment and Acceptance, have the rights and obligations of a Lender
under this Agreement, and the assigning Lender thereunder shall, to the
extent of the interest assigned by such Assignment and Acceptance, be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the assigning Lender's rights and
obligations under this Agreement, such Lender shall cease to be a party
hereto but shall continue to be entitled to the benefits of Sections 3.9,
3.11, 3.12 and 11.5 for matters arising while such person was a Lender). If
the assignee is not a United States person under Section 7701(a)(30) of the
Code, it shall deliver to the Credit Parties and the Administrative Agent
certification as to exemption from deduction or withholding of Taxes. Any
assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this Section 11.3 shall be treated for
purposes of this Agreement as a sale by such Lender of a participation in
such rights and obligations in accordance with paragraph (c) of this
Section.
(iv) The Administrative Agent, acting for this purpose as an
agent of the Borrower, shall maintain at one of its offices a copy of each
Assignment and Acceptance delivered to it and a register for the
recordation of the names and addresses of the Lenders, and the Commitment
of, and principal amount of the Loans and LOC Obligations owing to, each
Lender pursuant to the terms hereof from time to time (the "REGISTER"). The
entries in the Register shall be conclusive, and the Borrower, the
Administrative Agent, the Issuing Bank and the Lenders may treat each
Person whose name is recorded in the Register pursuant to the terms hereof
as a Lender hereunder for all purposes of this Agreement, notwithstanding
notice to the contrary. The Register shall be available for inspection by
the Borrower, the Issuing Lender and any Lender, at any reasonable time and
from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and
Acceptance executed by an assigning Lender and an assignee, the assignee's
completed administrative questionnaire (unless the assignee shall already
be a Lender hereunder), the processing and recordation fee referred to in
paragraph (b) of this Section and any written consent to such assignment
required by paragraph (b) of this Section, the Administrative Agent shall
accept such Assignment and Acceptance and record the information contained
therein in the Register. No assignment shall be effective for purposes of
this Agreement unless it has been recorded in the Register as provided in
this paragraph.
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(c) (i) Any Lender may, without the consent of the Borrower,
the Administrative Agent, the Issuing Lender or the Swingline Lender, sell
participations to one or more banks or other entities (a "Participant") in
all or a portion of such Lender's rights and obligations under this Credit
Agreement (including all or a portion of its Commitments and the Loans
owing to it); provided that (A) such Lender's obligations under this Credit
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such
obligations and (C) the Consolidated Parties, the Administrative Agent, the
Issuing Lender and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender's rights and
obligations under this Credit Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that
such Lender shall retain the sole right to enforce the Credit Documents and
to approve any amendment, modification or waiver of any provision of the
Credit Documents; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to
any amendment, modification or waiver described in the first proviso to
Section 11.6(A) that affects such Participant. Subject to paragraph (c)(ii)
of this Section, the Borrower agrees that each Participant shall be
entitled to the benefits of Sections 3.9, 3.11 and 3.12 to the same extent
as if it were a Lender and had acquired its interest by assignment pursuant
to paragraph (b) of this Section. To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 11.2 as
though it were a Lender, provided such Participant agrees to be subject to
Section 3.14 as though it were a Lender.
(ii) A Participant shall not be entitled to receive any
greater payment under Sections 3.9, 3.11 and 3.12 than the applicable
Lender would have been entitled to receive with respect to the
participation sold to such Participant, unless the sale of the
participation to such Participant is made with the Borrower's prior written
consent. A Participant that would be a Foreign Lender if it were a Lender
shall not be entitled to the benefits of Section 3.11 unless the Borrower
is notified of the participation sold to such Participant and such
Participant agrees, for the benefit of the Borrower, to comply with Section
3.11(d) as though it were a Lender.
(d) Any Lender may at any time pledge or assign a security
interest in all or any portion of its rights under this Credit Agreement
(i) to secure obligations of such Lender to a Federal Reserve Bank as
collateral security pursuant to Regulation A and any Operating Circular
issued by such Federal Reserve Bank, and this Section shall not apply to
any such pledge or assignment of a security interest; provided that no such
pledge or assignment of a security interest shall release a Lender from any
of its obligations hereunder or substitute any such pledgee or assignee for
such Lender as a party hereto, (ii) in the case of any Lender which has
made Tranche B Term Loans and is an investment fund, to the trustee under
the indenture to which such fund is a party in support of its obligations
to such trustee for the benefit of the applicable trust beneficiaries and
(iii) to appropriate entities within the Farm Credit System, as collateral
security.
(e) Any Lender may furnish any information concerning the
Consolidated Parties in the possession of such Lender from time to time to
assignees and participants (including prospective assignees and
participants), subject, however, to the provisions of Section 11.14 hereof.
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11.4. NO WAIVER; REMEDIES CUMULATIVE.
No failure or delay on the part of the Administrative Agent or any
Lender in exercising any right, power or privilege hereunder or under any other
Credit Document and no course of dealing between the Administrative Agent or any
Lender and any of the Credit Parties shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, power or privilege hereunder
or under any other Credit Document preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder or
thereunder. The rights and remedies provided herein are cumulative and not
exclusive of any rights or remedies which the Administrative Agent or any Lender
would otherwise have. No notice to or demand on any Credit Party in any case
shall entitle the Credit Parties to any other or further notice or demand in
similar or other circumstances or constitute a waiver of the rights of the
Administrative Agent or the Lenders to any other or further action in any
circumstances without notice or demand.
11.5. EXPENSES; INDEMNIFICATION.
(a) The Credit Parties jointly and severally agree to pay on demand all
reasonable costs and expenses of the Administrative Agent in connection with the
syndication, preparation, execution, delivery, administration, modification, and
amendment of this Credit Agreement, the other Credit Documents, and the other
documents to be delivered hereunder, including, without limitation, the
reasonable fees and expenses of counsel for the Administrative Agent with
respect thereto and with respect to advising the Administrative Agent as to its
rights and responsibilities under the Credit Documents. The Credit Parties
further jointly and severally agree to pay on demand all reasonable costs and
expenses of the Administrative Agent and one counsel to all of the Lenders, if
any, in connection with the enforcement (whether through negotiations, legal
proceedings, or otherwise) of the Credit Documents and the other documents to be
delivered hereunder, except to the extent such claim, damage, loss, liability,
cost, or expense results from the gross negligence, bad faith, willful
misconduct of the Person seeking reimbursement or a breach by such Person of its
obligations hereunder.
The Credit Parties jointly and severally agree to indemnify and hold
harmless the Administrative Agent and each Lender and each of their Affiliates
and their respective officers, directors, trustees, employees and agents (each,
an "INDEMNIFIED PARTY") from and against any and all claims, damages, actual
losses, liabilities, costs, and expenses (including, without limitation,
reasonable attorneys' fees of the Administrative Agent and, except as provided
below, one counsel to all of the Lenders and excluding taxes) that may be
incurred by or awarded against any Indemnified Party, in each case arising out
of or in connection with or by reason of (including, without limitation, in
connection with any investigation, litigation, or proceeding or preparation of
defense in connection therewith) the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the Loans,
except to the extent such claim, damage, loss, liability, cost, or expense
results from the gross negligence, bad faith or willful misconduct of such
Indemnified Party (or any of its Affiliates or any their respective officers,
directors, trustees, employees or agents) or from a breach by such Indemnified
Party (or any of its Affiliates or any their respective officers, directors,
trustees, employees or agents) of its obligations hereunder. In the case of an
investigation, litigation or other proceeding to which the indemnity in this
Section 11.5 applies, such indemnity shall be effective whether or not such
investigation, litigation or proceeding is brought by any of the
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Credit Parties, their respective directors, shareholders or creditors or an
Indemnified Party or any other Person or any Indemnified Party is otherwise a
party thereto and whether or not the transactions contemplated hereby are
consummated. No party hereto shall assert any claim against any other party
hereto, any of their Affiliates, or any of their respective directors, trustees,
officers, employees, attorneys, agents, and advisers, on any theory of
liability, for special, indirect, consequential, or punitive damages arising out
of or otherwise relating to the Credit Documents, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the Loans.
The Borrower shall be entitled to assume the defense of any action for which
indemnification is sought by an Indemnified Party hereunder with counsel of the
Borrower's choice at its expense (in which case the Borrower shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by an Indemnified Person except as set forth below); provided, however,
that such counsel shall be reasonably satisfactory to each Indemnified Party.
Notwithstanding the election by the Borrower to assume the defense of any such
action, each Indemnified Party shall have the right to employ separate counsel
and to participate in the defense of such action, and the Borrower shall bear
the reasonable fees, costs, and expenses of such separate counsel, if (i) the
use of counsel chosen by the Borrower to represent such Indemnified Party would
present such counsel with a conflict of interest; (ii) the actual or potential
defendants in, or targets of, any such action include both the Borrower and such
Indemnified Party and such Indemnified Party shall have reasonably concluded
that there may be legal defenses available to it that are different from or
additional to those available to the Borrower (in which case the Borrower shall
not have the right to assume the defense or such action on behalf of such
Indemnified Party); (iii) the Borrower shall not have employed counsel
reasonably satisfactory to such Indemnified Party to represent it within a
reasonable time after notice of the institution of such action; or (iv) the
Borrower shall authorize such Indemnified Party to employ separate counsel at
the Borrower's expense.
(b) Without prejudice to the survival of any other agreement of the
Credit Parties hereunder, the agreements and obligations of the Credit Parties
contained in this Section 11.5 shall survive the repayment of the Loans, LOC
Obligations and other Credit Party Obligations and the termination of the
Commitments hereunder.
11.6. AMENDMENTS, WAIVERS AND CONSENTS.
Neither this Credit Agreement nor any other Credit Document nor any of
the terms hereof or thereof may be amended, changed, waived, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, each of the Credit Parties
party thereto and the Required Lenders, provided, however, that:
(a) without the consent of each Lender directly affected thereby,
neither this Credit Agreement nor any other Credit Document may be amended,
changed, waived, discharged or terminated so as to
(i) extend any Commitment or the final maturity of any Loan or
of any reimbursement obligation, or any portion thereof, arising from
drawings under Letters of Credit, or extend or waive any Principal
Amortization Payment of any Loan, or any portion thereof,
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(ii) reduce the rate or extend the time of payment of interest
on any Loan or of any reimbursement obligation, or any portion thereof,
arising from drawings under Letters of Credit (other than as a result of
waiving the applicability of any post-default increase in interest rates)
or of any Fees,
(iii) reduce or waive the principal amount of any Loan or of
any reimbursement obligation, or any portion thereof, arising from drawings
under Letters of Credit,
(iv) increase the Commitment of a Lender over the amount
thereof in effect (it being understood and agreed that a waiver of any
condition precedent set forth in Section 5.2 or of any Default or Event of
Default or mandatory reduction in the Commitments shall not constitute a
change in the terms of any Commitment of any Lender),
(v) except as the result of or in connection with an Asset
Disposition not prohibited by Section 8.5, release all or substantially all
of the Collateral,
(vi) except as the result of or in connection with a
dissolution, merger or disposition of a Consolidated Party not prohibited
by Section 8.4 or Section 8.5, release the Borrower or substantially all of
the other Credit Parties from its or their obligations under the Credit
Documents,
(vii) amend, modify or waive any provision of this Section
11.6 or Section 3.13(a),
(viii) reduce any percentage specified in the definition of
Required Lenders, or
(ix) consent to the assignment or transfer by the Borrower or
all or substantially all of the other Credit Parties of any of its or their
rights and obligations under (or in respect of) the Credit Documents except
as permitted hereby or thereby;
(b) without the consent of Lenders (other than Defaulting Lenders)
holding in the aggregate at least a majority of the outstanding Tranche B Term
Loans (and Participation Interests therein), Section 3.3(b)(vi) may not be
amended, changed, waived, discharged or terminated so as to extend the time for
or change the amount or the manner of application of proceeds of any mandatory
prepayment required by Section 3.3(b)(ii), (iii), (iv) or (v) hereof;
(c) without the consent of the Administrative Agent, no provision of
Section 10 may be amended, changed, waived, discharged or terminated;
(d) without the consent of the Issuing Lender, no provision of Section
2.2 may be amended, changed, waived, discharged or terminated;
(e) without the consent of the Swingline Lender, no provision of
Section 2.3 may be amended; and
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(f) without the consent of Lenders holding in the aggregate at least
two-thirds of (i) the aggregate Revolving Commitments and the outstanding
Tranche B Loans or (ii) if all of the Revolving Commitments have been
terminated, the outstanding Loans and LOC Obligations (including, without
limitation, Participation Interests), amend this Section 11.6 to impose any
greater restriction on the ability of any Lender to assign any of its rights and
obligations hereunder.
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 shall determine whether or not to allow a Credit
Party to use cash collateral in the context of a bankruptcy or insolvency
proceeding and such determination shall be binding on all of the Lenders.
Notwithstanding the foregoing, this Credit Agreement may be amended (or
amended and restated) with the written consent of the Required Lenders, the
Administrative Agent and the Borrower (a) to add one or more additional credit
facilities to this Credit Agreement and to permit the extensions of credit from
time to time outstanding thereunder and the accrued interest and fees in respect
thereof to share ratably in the benefits of this Credit Agreement and the other
Credit Documents with the Tranche B Term Loans and Revolving Loans and the
accrued interest and fees in respect thereof and (b) to include appropriately
the Lenders holding such credit facilities in any determination of the Required
Lenders.
In addition, notwithstanding the foregoing, this Credit Agreement may
be amended with the written consent of the Administrative Agent, the Borrower
and the Lenders providing the relevant Replacement Term Loans (as defined below)
to permit the refinancing of all outstanding Tranche B Term Loans ("Refinanced
Term Loans") with a replacement "B" or "C" term loan tranche hereunder
("Replacement Term Loans"), provided that (a) the aggregate principal amount of
such Replacement Term Loans shall not exceed the aggregate principal amount of
such Refinanced Term Loans, (b) the weighted average life to maturity of such
Replacement Term Loans shall not be shorter than the weighted average life to
maturity of such Refinanced Term Loans at the time of such refinancing and (c)
all other terms applicable to such Replacement Term Loans shall be substantially
identical to, or less favorable to the Lenders providing such Replacement Term
Loans than, those applicable to such Refinanced Term Loans, except to the extent
necessary to provide for covenants and other terms applicable to any period
after the latest final maturity of the Refinanced Term Loans in effect
immediately prior to such refinancing.
11.7. COUNTERPARTS.
This Credit Agreement may be executed in any number of counterparts,
each of which when so executed shall be an original, but all of which shall
constitute one and the same instrument. It shall not be necessary in making
proof of this Credit Agreement to produce or account for more than one such
counterpart for each of the parties hereto. Delivery by facsimile by any of the
parties hereto of an executed counterpart of this Credit Agreement shall be as
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effective as an original executed counterpart hereof and shall be deemed a
representation that an original executed counterpart hereof will be delivered.
11.8. HEADINGS.
The headings of the sections hereof are provided for convenience only
and shall not in any way affect the meaning or construction of any provision of
this Credit Agreement.
11.9. SURVIVAL.
All indemnities set forth herein, including, without limitation, in
Section 2.2(i), 3.11, 3.12, 10.5 or 11.5 shall survive the execution and
delivery of this Credit Agreement, the making of the Loans, the issuance of the
Letters of Credit, the repayment of the Loans, LOC Obligations and other
obligations under the Credit Documents and the termination of the Commitments
hereunder, and all representations and warranties made by the Credit Parties
herein shall survive until this Credit Agreement shall be terminated in
accordance with the terms of Section 11.13(b).
11.10. GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE.
(a) THIS CREDIT AGREEMENT AND, UNLESS OTHERWISE EXPRESSLY PROVIDED
THEREIN, THE OTHER CREDIT DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND THEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Any legal
action or proceeding with respect to this Credit Agreement or any other Credit
Document may be brought in the courts of the State of New York in New York
County, or of the United States for the Southern District of New York, and, by
execution and delivery of this Credit Agreement, each of the Credit Parties
hereby irrevocably accepts for itself and in respect of its property, generally
and unconditionally, the nonexclusive jurisdiction of such courts. Each of the
Credit Parties further irrevocably consents to the service of process out of any
of the aforementioned courts in any such action or proceeding by the mailing of
copies thereof by registered or certified mail, postage prepaid, to it at the
address set out for notices pursuant to Section 11.1, such service to become
effective three (3) days after such mailing. Nothing herein shall affect the
right of the Administrative Agent or any Lender to serve process in any other
manner permitted by law or to commence legal proceedings or to otherwise proceed
against any Credit Party in any other jurisdiction.
(b) Each of the Credit Parties hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Credit Agreement or any other Credit Document brought in the courts referred to
in subsection (a) above and hereby further irrevocably waives and agrees not to
plead or claim in any such court that any such action or proceeding brought in
any such court has been brought in an inconvenient forum.
(c) TO THE EXTENT PERMITTED BY LAW, EACH OF THE ADMINISTRATIVE AGENT,
THE LENDERS AND EACH OF THE CREDIT PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR
RELATING TO THIS
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CREDIT AGREEMENT, ANY OF THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
11.11. SEVERABILITY.
If any provision of any of the Credit Documents is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.
11.12. ENTIRETY.
This Credit Agreement together with the other Credit Documents
represent the entire agreement of the parties hereto and thereto, and supersede
all prior agreements and understandings, oral or written, if any, including any
commitment letters or correspondence relating to the Credit Documents or the
transactions contemplated herein and therein.
11.13. BINDING EFFECT; TERMINATION.
(a) This Credit Agreement shall become effective at such time on or
after the Closing Date when it shall have been executed by each Credit Party and
the Administrative Agent, and the Administrative Agent shall have received
copies hereof (telefaxed or otherwise) which, when taken together, bear the
signatures of each Lender, and thereafter this Credit Agreement shall be binding
upon and inure to the benefit of each Credit Party, the Administrative Agent and
each Lender and their respective successors and assigns.
(b) The term of this Credit Agreement shall be until the Credit Party
Obligations under clause (i) of such definition (other than contingent indemnity
obligations) are Fully Satisfied.
11.14. CONFIDENTIALITY.
(a) The Administrative Agent and each Lender (each, a "LENDING PARTY")
agrees to keep confidential any information furnished or made available to it by
or on behalf of the Credit Parties pursuant to this Credit Agreement; provided
that nothing herein shall prevent any Lending Party from disclosing such
information (a) to any other Lending Party or any Affiliate of any Lending
Party, or any officer, director, employee, agent, or advisor of any Lending
Party or Affiliate of any Lending Party, provided in each case that such Person
is informed of the confidential nature of such information, (b) to any other
Person if reasonably incidental to the administration of the Credit Facilities,
provided in each case that such Person is informed of the confidential nature of
such information, (c) as required by any law, rule, or regulation, (d) upon the
order of any court or administrative agency, (e) upon the request or demand of
any regulatory agency or authority having jurisdiction over such Lending Party,
(f) that is or becomes available to the public or that is or becomes available
to any Lending Party other than as a result of a disclosure by any Lending Party
or other Person bound by this Section 11.14 prohibited by this Credit Agreement,
(g) in connection with any litigation to which such Lending Party or any of its
Affiliates may be a party, provided, such Lending Party will, to the extent
practical, use reasonable efforts to notify the Borrower prior to such
disclosure, (h) to the
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extent necessary in connection with the exercise of any remedy under this Credit
Agreement or any other Credit Document, (i) to the National Association of
Insurance Commissioners or any similar organization or any nationally recognized
rating agency that requires access to information about a Lender's investment
portfolio in connection with ratings issued with respect to such Lender, (j) to
any direct or indirect contractual counterparty in swap agreements or such
contractual counterparty's professional advisor (so long as such contractual
counterparty or professional advisor to such contractual counterparty (i) has
been approved in writing by the Borrower and (ii) agrees in a writing
enforceable by the Borrower to be bound by the provisions of this Section 11.14)
and
(b) subject to provisions substantially similar to those contained in
this Section 11.14, to any actual or proposed participant or assignee.
11.15. SOURCE OF FUNDS.
Each of the Lenders hereby represents and warrants to the Borrower that
at least one of the following statements is an accurate representation as to the
source of funds to be used by such Lender in connection with the financing
hereunder:
(a) no part of such funds constitutes assets allocated to any separate
account maintained by such Lender in which any employee benefit plan (or its
related trust) has any interest;
(b) to the extent that any part of such funds constitutes assets
allocated to any separate account maintained by such Lender, such Lender has
disclosed to the Borrower the name of each employee benefit plan whose assets in
such account exceed 10% of the total assets of such account as of the date of
such purchase (and, for purposes of this clause (b), all employee benefit plans
maintained by the same employer or employee organization are deemed to be a
single plan);
(c) to the extent that any part of such funds constitutes assets of an
insurance company's general account, such insurance company has complied with
all of the requirements of the regulations issued under Section 401(c)(1)(A) of
ERISA; or
(d) such funds constitute assets of one or more specific benefit plans
which such Lender has identified in writing to the Borrower.
As used in this Section 11.15, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in Section 3
of ERISA.
11.16. REGULATION D.
Each of the Lenders hereby represents and warrants to the Borrower that
it is a commercial lender, other financial institution or other "accredited"
investor (as defined in SEC Regulation D) which makes or acquires or loans in
the ordinary course of business and that it will make or acquire Loans for its
own account in the ordinary course of business.
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11.17. 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 Credit Agreement shall control.
[Signature Pages to Follow]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart
of this Credit Agreement to be duly executed and delivered as of the date first
above written.
BORROWER: AGRILINK FOODS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
PARENT: AGRILINK HOLDINGS INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
SUBSIDIARY GUARANTORS LINDEN OAKS CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
XXXXXXX ENDEAVORS INCORPORATED
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
BEMSA HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President
2
ADMINISTRATIVE AGENT: JPMORGAN CHASE BANK, in its capacity as
Administrative Agent and as a Lender
By: /s/ Xxxxxx Anasatasio
-------------------------------------
Name: Xxxxxx Anasatasio
Title: Vice President
3
SYNDICATION AGENT: BANK OF AMERICA, N.A., in its capacity as Syndication
Agent and as a Lender
By: /s/ W. Xxxxxx Xxxxxxx
-------------------------------------
Name: W. Xxxxxx Xxxxxxx
Title: Managing Director
4
CO-DOCUMENTATION AGENT: XXXXXX TRUST AND SAVINGS BANK, in its capacity
as Co-Documentation Agent and as a Lender
By: /s/ Xxxxx Xxxxxx
-------------------------------------
Name: Xxxxx Xxxxxx
Title: Vice President
5
CO-DOCUMENTATION AGENT: U.S. BANK NATIONAL ASSOCIATION, in its capacity
as Co-Documentation Agent and as a Lender
By: /s/ Xxxx X. Xxxx
-------------------------------------
Name: Xxxx X. Xxxx
Title: Vice President
