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CREDIT AGREEMENT
CREDIT AGREEMENT dated as of October 21, 1999 among Safety
1st, Inc., a Massachusetts corporation (the "BORROWER"), the banks, financial
institutions and other institutional lenders listed on the signature pages
hereof as the Initial Lenders (the "INITIAL LENDERS"), Union Bank of California,
N.A., as syndication agent (the "SYNDICATION AGENT"), LaSalle Bank National
Association, as documentation agent (the "DOCUMENTATION AGENT"), BNP Capital
Markets, LLC, as the lead arranger (the "LEAD ARRANGER") and Banque Nationale de
Paris ("BNP"), as the initial issuing bank (the "INITIAL ISSUING BANK"), as the
swing line bank (the "SWING LINE BANK"), and as administrative agent (together
with any successors appointed pursuant to Article VII, the "ADMINISTRATIVE
AGENT") for the Lender Parties (as hereinafter defined).
PRELIMINARY STATEMENTS:
(1) The Borrower has requested that the Lender Parties lend to
the Borrower up to $70,000,000 in order to refinance certain Existing Debt (as
hereinafter defined), refinance all of its existing redeemable preferred stock
of the Borrower, pay transaction fees and expenses, provide working capital for
the Borrower and its Material Subsidiaries (as hereinafter defined) and for
other general corporate purposes permitted hereby.
(2) The Lender Parties have indicated their willingness to
agree to lend such amounts on the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
"ADMINISTRATIVE AGENT" has the meaning specified in the
recital of parties to this Agreement.
"ADMINISTRATIVE AGENT'S ACCOUNT" means the account of the
Administrative Agent maintained by the Administrative Agent at the
Federal Reserve Bank of New York, 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, ABA No. 000000000, for further credit to Account No.
750420-701-03, or such other account maintained by the Administrative
Agent and designated by the Administrative Agent in a written notice to
the Lender Parties and the Borrower.
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"ADVANCE" means a Term A Advance, a Working Capital Advance, a
Swing Line Advance or a Letter of Credit Advance.
"AFFILIATE" means, as to any Person, any other Person that,
directly or indirectly, controls, is controlled by or is under common
control with such Person or is a director or officer of such Person.
For purposes of this definition and the definition of Xxxxxx Group, the
term "control" (including the terms "controlling", "controlled by" and
"under common control with") of a Person means the possession, direct
or indirect, of the power to vote 5% or more of the Voting Interests of
such Person or to direct or cause the direction of the management and
policies of such Person, whether through the ownership of Voting
Interests, by contract or otherwise.
"AGENTs" means the Administrative Agent, the Syndication
Agent, the Documentation Agent and any other agent appointed by the
Administrative Agent and "AGENT" means any of them, as the case may be.
"AGREEMENT VALUE" means, for each Hedge Agreement, on any date
of determination, an amount determined by the Administrative Agent
equal to: (a) in the case of a Hedge Agreement documented pursuant to
the Master Agreement (Multicurrency-Cross Border) published by the
International Swap and Derivatives Association, Inc. (the "MASTER
AGREEMENT"), the amount, if any, that would be payable by any Loan
Party or any of its Subsidiaries to its counterparty to such Hedge
Agreement, as if (i) such Hedge Agreement was being terminated early on
such date of determination, (ii) such Loan Party or Subsidiary was the
sole "Affected Party", and (iii) the Administrative Agent was the sole
party determining such payment amount (with the Administrative Agent
making such determination pursuant to the provisions of the form of
Master Agreement); or (b) in the case of a Hedge Agreement traded on an
exchange, the xxxx-to-market value of such Hedge Agreement, which will
be the unrealized loss on such Hedge Agreement to the Loan Party or
Subsidiary of a Loan Party party to such Hedge Agreement determined by
the Administrative Agent based on the settlement price of such Hedge
Agreement on such date of determination, or (c) in all other cases, the
xxxx-to-market value of such Hedge Agreement, which will be the
unrealized loss on such Hedge Agreement to the Loan Party or Subsidiary
of a Loan Party party to such Hedge Agreement determined in good faith
by the Administrative Agent as the amount, if any, by which (i) the
present value of the future cash flows to be paid by such Loan Party or
Subsidiary exceeds (ii) the present value of the future cash flows to
be received by such Loan Party or Subsidiary pursuant to such Hedge
Agreement; capitalized terms used and not otherwise defined in this
definition shall have the respective meanings set forth in the above
described Master Agreement.
"ANNUALIZATION FACTOR" means a fraction the numerator of which
is the number 12 and the denominator of which is the number of full
months following November 1, 1999.
"APPLICABLE LENDING OFFICE" means, with respect to each Lender
Party, such Lender Party's Domestic Lending Office in the case of a
Base Rate Advance and such Lender Party's Eurodollar Lending Office in
the case of a Eurodollar Rate Advance.
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"APPLICABLE MARGIN" means a percentage per annum determined as
set forth below:
FACILITY BASE RATE ADVANCES EURODOLLAR RATE ADVANCES
-------- ------------------ ------------------------
Term A Facility 2.00% 3.25%
Working Capital Facility 2.00% 3.25%
provided, however, that the Applicable Margin shall, as at any date
following the date on which the financial information for the Fiscal
Quarter ending June 30, 2000 is delivered pursuant to Section 5.03(b),
be a percentage per annum determined by reference to the Leverage Ratio
of the Borrower and its Subsidiaries, as set forth below:
---------------------- ------------------------------- -------------------------------
Term A Facility Working Capital Facility
---------------------- --------------- --------------- -------------- ----------------
Leverage Base Rate Eurodollar Base Rate Eurodollar
Ratio Margin Rate Margin Margin Rate Margin
---------------------- --------------- --------------- -------------- ----------------
LEVEL IV 2.00% 3.25% 2.00% 3.25%
--------
Greater than 3.25x
---------------------- --------------- --------------- -------------- ----------------
LEVEL III 1.75% 3.00% 1.75% 3.00%
---------
Equal to or less
than 3.25x but
greater than 2.50x
---------------------- --------------- --------------- -------------- ----------------
LEVEL II 1.50% 2.75% 1.50% 2.75%
--------
Equal to or less
than 2.50x but
greater than 2.00x
---------------------- --------------- --------------- -------------- ----------------
LEVEL I 1.25% 2.50% 1.25% 2.50%
-------
Equal to or less
than 2.00x
---------------------- --------------- --------------- -------------- ----------------
Thereafter, the Applicable Margin for each Advance shall be determined
by reference to the Leverage Ratio in effect from time to time;
provided, however, that (i) no change in the Applicable Margin shall be
effective until three Business Days after the date on which the
Administrative Agent receives the financial information required to be
delivered as at the end of each Fiscal Quarter pursuant to Section
5.03(b) and (ii) the Applicable Margin shall be at Level IV for so long
as the Borrower has not submitted to the Administrative Agent the
information described in clause (i) of this proviso as and when
required at the end of each Fiscal Quarter.
"APPROPRIATE LENDER" means, at any time, with respect to (a)
any of the Term A or Working Capital Facilities, a Lender that has a
Commitment with respect to such Facility at such time, (b) the Letter
of Credit Facility, (i) the Issuing Bank and (ii) if the other Working
Capital Lenders have made Letter of Credit Advances pursuant to Section
2.03(c) that are outstanding at such time, each such other Working
Capital Lender and (c) the Swing Line Facility, (i) the Swing Line Bank
and (ii) if the other Working Capital Lenders have made Swing Line
Advances pursuant to Section 2.02(b) that are outstanding at such time,
each such other Working Capital Lender.
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"APPROVED FUND" means, with respect to any Lender that is a
fund that invests in bank loans, any other fund that invests in bank
loans and is advised or managed by the same investment advisor as such
Lender or by an Affiliate of such investment advisor.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender Party and an Eligible Assignee and accepted by
the Administrative Agent (not to be unreasonably withheld), in
accordance with Section 8.07 and in substantially the form of Exhibit C
hereto.
"AVAILABLE AMOUNT" of any Letter of Credit means, at any time,
the maximum amount available to be drawn under such Letter of Credit at
such time (assuming compliance at such time with all conditions to
drawing).
"BASE RATE" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the highest of:
(a) the rate of interest announced publicly
by BNP in New York, New York, from time to time, as its prime
rate (and such term shall not be construed to be its best or
most favorable rate);
(b) 1/2 of 1% per annum above the Federal
Funds Rate; and.
(c) for the period from December 15, 1999
through January 15, 2000, 2% per annum above the Federal Funds
Rate.
"BASE RATE ADVANCE" means an Advance that bears interest as
provided in Section 2.07(a)(i).
"BLOCKED ACCOUNT" has the meaning specified in the Security
Agreement.
"BLOCKED ACCOUNT BANK" has the meaning specified in the
Security Agreement.
"BLOCKED ACCOUNT LETTER" has the meaning specified in the
Security Agreement.
"BNP" has the meaning specified in the recital of parties to
this Agreement.
"BORROWER" has the meaning specified in the recital of parties
to this Agreement.
"BORROWER'S ACCOUNT" means the account of the Borrower
maintained by the Borrower with BNP at BNP's office at 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Account No. 205499, or such other account as
the Borrower and the Administrative Agent may from time to time
designate as the "Borrower's Account".
"BORROWING" means a Term A Borrowing, a Swing Line Borrowing
or a Working Capital Borrowing.
"BORROWING BASE CERTIFICATE" means a certificate in
substantially the form of Exhibit F hereto, as applicable, in each case
duly certified by the chief financial officer of the Borrower.
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized by law to close in New York City and, if the
applicable Business Day relates to
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any Eurodollar Rate Advances, on which dealings are carried on in the
London interbank market.
"CANADIAN SUBSIDIARY GUARANTY" means a guaranty made by each
Foreign Subsidiary which is also a Material Subsidiary (other than any
Foreign Subsidiary which is a Material Subsidiary which executes the
Non-U.S. Subsidiary Guaranty), in substantially the form of Exhibit E-4
(together with each other guaranty made by a Foreign Subsidiary which
is Material Subsidiary delivered pursuant to Section 5.01(j), in each
case as amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with its terms).
"CAPITAL EXPENDITURES" means, for any Person for any period,
the sum of, without duplication, (a) all cash expenditures made,
directly or indirectly, by such Person or any of its Subsidiaries
during such period for equipment, fixed assets, real property or
improvements, or for replacements or substitutions therefor or
additions thereto, that have been or should be, in accordance with
GAAP, reflected as additions to property, plant or equipment on a
Consolidated balance sheet of such Person plus (b) the aggregate
principal amount of all Debt (including Obligations under Capitalized
Leases) assumed or incurred in connection with any such expenditures.
"CAPITALIZED LEASES" means all leases that have been or should
be, in accordance with GAAP, recorded as capitalized leases.
"CARRYOVER AMOUNT" has the meaning specified in Section
5.04(d).
"CASH EQUIVALENTS" means any of the following, to the extent
owned by the Borrower or any of its Subsidiaries free and clear of all
Liens other than Liens created under the Collateral Documents and
having a maturity of not greater than 180 days from the date of
acquisition thereof: (a) readily marketable direct obligations of the
Government of the United States or any agency or instrumentality
thereof or obligations unconditionally guaranteed by the full faith and
credit of the Government of the United States, (b) insured certificates
of deposit of or time deposits with any commercial bank that is a
Lender Party or a member of the Federal Reserve System, issues (or the
parent of which issues) commercial paper rated as described in clause
(c), is organized under the laws of the United States or any State
thereof and has combined capital and surplus of at least $1 billion,
(c) commercial paper in an aggregate amount of no more than $250,000
per issuer outstanding at any time, issued by any corporation organized
under the laws of any State of the United States and rated at least
"Prime-1" (or the then equivalent grade) by Xxxxx'x Investors Service,
Inc. or "A-1" (or the then equivalent grade) by Standard & Poor's
Ratings Group, a division of The XxXxxx-Xxxx Companies, Inc., or (d)
money market or mutual funds that invest solely in Cash Equivalents of
the types described in clauses (a), (b) and (c) above.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CERCLIS" means the Comprehensive Environmental Response,
Compensation and Liability Information System maintained by the U.S.
Environmental Protection Agency.
"CHANGE OF CONTROL" means the occurrence of any of the
following: (a) any Person or two or more Persons acting in concert
shall have acquired beneficial ownership (within the meaning of Rule
13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934), directly or indirectly, of Voting Interests of
the Borrower (or other securities convertible into such Voting
Interests) representing a percentage of the combined
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voting power of all Voting Interests of the Borrower that exceeds
the percentage of the combined voting power of all Voting Interests
of the Borrower beneficially owned by the Xxxxxx Group, or
(b) during any period of up to 24 consecutive months, commencing after
the date of this Agreement, individuals who at the beginning of such
24-month period were directors of the Borrower shall cease for any
reason to constitute a majority of the board of directors of the
Borrower.
"COLLATERAL" means all "Collateral" referred to in the
Collateral Documents and all other property that is or is intended to
be subject to any Lien in favor of the Administrative Agent for the
benefit of the Secured Parties.
"COLLATERAL DOCUMENTS" means the Security Agreement, each
Non-U.S. Security Agreement, the Equitable Share Charge and any other
agreement that creates or purports to create a Lien in favor of the
Administrative Agent for the benefit of the Secured Parties.
"COMMITMENT" means a Term A Commitment, a Working Capital
Commitment, a Swing Line Commitment or a Letter of Credit Commitment.
"CONSOLIDATED" refers, with respect to any Person, to the
consolidation of accounts of such Person and its Subsidiaries in
accordance with GAAP.
"CONTINGENT OBLIGATION" means, with respect to any Person, any
Obligation or arrangement of such Person to guarantee or intended to
guarantee any Debt, leases, dividends or other payment Obligations
("PRIMARY OBLIGATIONS") of any other Person (the "PRIMARY OBLIGOR") in
any manner, whether directly or indirectly, including, without
limitation, (a) the direct or indirect guarantee, endorsement (other
than for collection or deposit in the ordinary course of business),
co-making, discounting with recourse or sale with recourse by such
Person of the Obligation of a primary obligor, (b) the Obligation to
make take-or-pay or similar payments, if required, regardless of
nonperformance by any other party or parties to an agreement or (c) any
Obligation of such Person, whether or not contingent, (i) to purchase
any such primary obligation or any property constituting direct or
indirect security therefor, (ii) to advance or supply funds (A) for the
purchase or payment of any such primary obligation or (B) to maintain
working capital or equity capital of the primary obligor or otherwise
to maintain the net worth or solvency of the primary obligor, (iii) to
purchase property, assets, securities or services primarily for the
purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary
obligation or (iv) otherwise to assure or hold harmless the holder of
such primary obligation against loss in respect thereof. The amount of
any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of
which such Contingent Obligation is made (or, if less, the maximum
amount of such primary obligation for which such Person may be liable
pursuant to the terms of the instrument evidencing such Contingent
Obligation) or, if not stated or determinable, the maximum reasonably
anticipated liability in respect thereof (assuming such Person is
required to perform thereunder), as determined by such Person in good
faith.
"CONVERSION", "CONVERT" and "CONVERTED" each refer to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.09 or 2.10.
"CURRENT ASSETS" of any Person means all assets of such Person
that would, in accordance with GAAP, be classified as current assets of
a company conducting a business the same as or similar to that of such
Person, after deducting adequate reserves in each case in which a
reserve is proper in accordance with GAAP.
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"CURRENT LIABILITIES" of any Person means (a) all Debt of such
Person that by its terms is payable on demand or matures within one
year after the date of determination other than Funded Debt and (b) all
other items (including, without limitation, taxes accrued as estimated)
that in accordance with GAAP would be classified as current liabilities
of a company conducting a business the same as or similar to that of
such Person.
"DEBT" of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money, (b) all Obligations,
contingent or otherwise, of such Person for the deferred purchase price
of property or services (other than trade payables not overdue by more
than 60 days incurred in the ordinary course of such Person's
business), (c) all Obligations, contingent or otherwise, of such Person
evidenced by notes, bonds, debentures or other similar instruments, (d)
all Obligations, contingent or otherwise, of such Person created or
arising under any conditional sale or other title retention agreement
with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the
event of default are limited to repossession or sale of such property),
(e) all Obligations, contingent or otherwise, of such Person as lessee
under Capitalized Leases, (f) all Obligations, contingent or otherwise,
of such Person under acceptance, letter of credit or similar
facilities, (g) all Obligations of such Person to purchase, redeem,
retire, defease or otherwise make any payment in respect of any Equity
Interests in such Person or any other Person or any warrants, rights or
options to acquire such capital stock of such Person in respect of
management profit sharing plans, valued, in the case of Redeemable
Preferred Interests, at the greater of its voluntary or involuntary
liquidation preference plus accrued and unpaid dividends, (h) all
Obligations of such Person in respect of Hedge Agreements, valued at
the Agreement Value thereof, (i) all Contingent Obligations of such
Person and (j) all indebtedness and other payment Obligations referred
to in clauses (a) through (i) above of another Person secured by (or
for which the holder of such Debt has an existing right, contingent or
otherwise, to be secured by) any Lien on property (including, without
limitation, accounts and contract rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such indebtedness or other payment Obligations.
"DEFAULT" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"DOCUMENTATION AGENT" has the meaning specified in the recital
of parties to this Agreement.
"DOMESTIC LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Domestic
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party,
as the case may be, or such other office of such Lender Party as such
Lender Party may from time to time specify to the Borrower and the
Administrative Agent.
"DOMESTIC SUBSIDIARY" of any Person means any Subsidiary other
than a Foreign Subsidiary.
"EBITDA" means, for any period, the sum, determined on a
Consolidated basis, of (a) net income (or net loss), (b) Interest
Expense, (c) income tax expense, (d) depreciation expense, (e)
amortization expense, (f) noncash charges incurred in connection with
stock options granted to employees of the Borrower and (g)
extraordinary, non-recurring and non-cash transactional or unusual
losses deducted in calculating net income less extraordinary,
non-recurring and non-cash transactional or unusual gains added in
calculating net income, determined in accordance with GAAP for such
period; provided, however, there shall be
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excluded from EBITDA, to the extent therein included, all non-cash
foreign currency and Hedge Agreement losses and all non-cash foreign
currency and Hedge Agreement gains.
"ELIGIBLE ASSIGNEE" means (a) with respect to any Facility:
(i) a Lender Party; (ii) an Affiliate of a Lender Party or an Approved
Fund; (iii) a commercial bank organized under the laws of the United
States, or any State thereof, and having a combined capital and surplus
of at least $500,000,000; (iv) a savings and loan association or
savings bank organized under the laws of the United States, or any
State thereof, and having a combined capital and surplus of at least
$500,000,000; (v) a commercial bank organized under the laws of any
other country that is a member of the OECD or has concluded special
lending arrangements with the International Monetary Fund associated
with its General Arrangements to Borrow or a political subdivision of
any such country, and having a combined capital and surplus of at least
$500,000,000, so long as such bank is acting through a branch or agency
located in the United States; (vi) a finance company, insurance company
or other financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making,
purchasing or otherwise investing in commercial loans in the ordinary
course of its business and having a combined capital and surplus of at
least $250,000,000; and (vii) any other Person approved by the
Administrative Agent and, unless a Default has occurred and is
continuing at the time any assignment is effected pursuant to Section
8.07, the Borrower and, with respect to any Eligible Assignee that
becomes a Working Capital Lender, the Issuing Bank, any such approval
in either case not to be unreasonably withheld or delayed and (b) with
respect to the Letter of Credit Facility, a Person that is an Eligible
Assignee under subclause (iii) or (v) of clause (a) of this definition
and is approved by the Administrative Agent and, unless a Default has
occurred and is continuing at the time any assignment is effected
pursuant to Section 8.07, the Borrower, such approval not to be
unreasonably withheld or delayed; provided, however, that neither any
Loan Party nor any Affiliate of a Loan Party shall qualify as an
Eligible Assignee under this definition.
"ELIGIBLE COLLATERAL" means, collectively, Eligible Inventory
and Eligible Receivables.
"ELIGIBLE INVENTORY" means any Inventory owned by any Loan
Party organized in the United States, Canada or the United Kingdom free
and clear of all Liens (other than Permitted Liens and Liens in favor
of the Secured Parties securing the Secured Obligations) other than the
following:
(a) Inventory consisting of "perishable agricultural
commodities" within the meaning of the Perishable Agricultural
Commodities Act of 1930, as amended, and the regulations
thereunder, or on which a Lien has arisen or may arise in
favor of agricultural producers under comparable state or
local laws;
(b) Inventory located on leaseholds as to which the
lessor has not entered into a consent and agreement providing
the Administrative Agent with the right to receive notice of
default, the right to repossess such Inventory at any time and
such other rights as may be reasonably acceptable to the
Administrative Agent;
(c) Inventory that is obsolete, unusable or otherwise
unavailable for sale;
(d) Inventory with respect to which the
representations and warranties set forth in Section 9 of the
Security Agreement or any other Collateral Document applicable
to Inventory are not true and correct in all material
respects;
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(e) Inventory consisting of promotional, marketing,
packaging or shipping materials and supplies;
(f) Inventory that fails to meet all standards in all
material respects imposed by any governmental agency, or
department or division thereof, having regulatory authority
over such Inventory or its use or sale;
(g) Inventory that is subject to any licensing,
patent, royalty, trademark, or trade name or copyright
agreement with any third party from whom any Loan Party or any
of their Subsidiaries has received written notice of a dispute
in respect of any such agreement;
(h) Inventory located outside the United States,
Canada or England (other than up to $1,000,000 of Inventory
subject to arrangements reasonably acceptable to the
Administrative Agent) (other than Inventory in transit to the
Loan Parties by common carrier in the ordinary course of
business and insured under policies of insurance that (i) name
the Administrative Agent as loss payee and (ii) are otherwise
on terms and with insurers reasonable acceptable to the
Administrative Agent);
(i) Inventory that is not in the possession of or
under the sole control of the Loan Parties (other than
Inventory in transit to the Loan Parties by common carrier in
the ordinary course of business and insured under policies of
insurance that (i) name the Administrative Agent as the loss
payee and (ii) are otherwise on terms and with insurers
reasonably acceptable to the Administrative Agent);
(j) Inventory consisting of work in progress; and
(k) Inventory in respect of which the Security
Agreement, after giving effect to the related filings of
financing statements that have then been made, if any, does
not or has ceased to create a valid and perfected first
priority lien or security interest in favor of the Secured
Parties securing the Secured Obligations and as to which no
other Liens exist, other than Permitted Liens.
Eligible Inventory shall also include goods ordered under Trade Letters
of Credit issued and outstanding. The value of such Eligible Inventory
shall be its book value determined in accordance with a budget standard
cost which approximates the "first-in, first-out" method of accounting
for inventory and in accordance with GAAP unless the Administrative
Agent determines, in its reasonable discretion (taking into
consideration, among other factors, cost and liquidation value), that
such Eligible Inventory shall be valued at a lower value.
"ELIGIBLE RECEIVABLES" means any Receivables owned by any Loan
Party organized in the United States, Canada or the United Kingdom free
and clear of all Liens (other than Permitted Liens and Liens in favor
of the Secured Parties securing the Secured Obligations) other than the
following:
(a) Receivables that do not arise out of sales of goods or
rendering of services in the ordinary course of each respective Loan
Party's business;
(b) Receivables on terms other than those normal or
customary in each respective Loan Party's business;
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(c) Receivables owing from any Person that is an
Affiliate of the Borrower;
(d) Receivables (i) more than 120 days past the
original invoice date, or (ii) more than 60 days past the date due;
(e) Receivables owing from any Person from which an
aggregate amount of more than 50% of the Receivables owing are (1) more
than 60 days past due or (2) in dispute. The treatment of "on account"
payments (lump sum payments made by any Person that have not yet been
applied to individual invoices outstanding) for calculation of amounts
more than 60 days past due will be to apply the payment to the oldest
outstanding invoices first;
(f) Any receivable owing from a Person that has
asserted in writing any claim, demand or liability against any Loan
Party, whether by action, suit, counterclaim or other judicial or
arbitral proceeding;
(g) Receivables owing from any Person that shall
take, or be the subject of, any action or proceeding of a type
described in Section 6.01(f);
(h) Receivables (i) owing from any Person that is
also a supplier to or creditor of the Loan Parties to the extent of the
amount of any right of set-off, unless such Person has waived all
rights of set-off in a manner acceptable to the Administrative Agent or
(ii) representing any manufacturer's or supplier's credits, discounts,
incentive plans or similar arrangements entitling the Loan Parties to
discounts on future purchase therefrom;
(i) Receivables arising out of sales to account
debtors outside the United States, unless such Receivables are fully
backed by an irrevocable letter of credit on terms, and issued by a
bank organized under the laws of the United States, or any State
thereof, and having a combined capital and surplus of at least
$500,000,000 or any other financial institution acceptable to the
Administrative Agent and such irrevocable letter of credit is in the
possession of the Administrative Agent if so requested by it;
(j) Receivables arising out of sales on a
xxxx-and-hold, guaranteed sale, sale-or-return, sale on approval or
consignment basis or subject to any right of return (other than
warranty returns), set-off or charge-back (to the extent of the amount
thereof);
(k) Receivables owing from an account debtor that is
an agency, department or instrumentality of the United States or any
State thereof; and
(l) Receivables in respect of which the Security
Agreement, after giving effect to the related filings of financing
statements that have then been made, if any, does not or has ceased to
create a valid and perfected first priority lien or security interest
in favor of the Administrative Agent for the benefit of the Secured
Parties securing the Secured Obligations and as to which no other Liens
exist, other than Permitted Liens.
The value of such Eligible Receivables shall be their book value determined
in accordance with GAAP unless the Administrative Agent determines, in its
reasonable discretion, that such Eligible Receivables shall be valued at a
lower value.
11
"EQUITABLE SHARE CHARGE" means the share charge by the
Borrower in favor of the Administrative Agent dated on or about the
date of this Agreement.
"ENVIRONMENTAL ACTION" means any action, suit, demand, demand
letter, claim, notice of non-compliance or violation, notice of
liability or potential liability, investigation, proceeding, consent
order or consent agreement relating in any way to any Environmental
Law, any Environmental Permit or Hazardous Material or arising from
alleged injury or threat to health, safety or the environment,
including, without limitation, (a) by any governmental or regulatory
authority for enforcement, cleanup, removal, response, remedial or
other actions or damages and (b) by any governmental or regulatory
authority or third party for damages, contribution, indemnification,
cost recovery, compensation or injunctive relief.
"ENVIRONMENTAL LAW" means any federal, state, local or foreign
statute, law, ordinance, rule, regulation, code, order, writ, judgment,
injunction, decree or judicial or agency interpretation, policy or
guidance relating to pollution or protection of the environment,
health, safety or natural resources, including, without limitation,
those relating to the use, handling, transportation, treatment,
storage, disposal, release or discharge of Hazardous Materials.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"EQUITY INTERESTS" means, with respect to any Person, shares
of capital stock of (or other ownership or profit interests in) such
Person, warrants, options or other rights for the purchase or other
acquisition from such Person of shares of capital stock of (or other
ownership or profit interests in) such Person, securities convertible
into or exchangeable for shares of capital stock of (or other ownership
or profit interests in) such Person or warrants, rights or options for
the purchase or other acquisition from such Person of such shares (or
such other interests), and other ownership or profit interests in such
Person (including, without limitation, partnership, member or trust
interests therein), whether voting or nonvoting, and whether or not
such shares, warrants, options, rights or other interests are
authorized or otherwise existing on any date of determination.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"ERISA AFFILIATE" means any Person that for purposes of Title
IV of ERISA is a member of the controlled group of any Loan Party, or
under common control with any Loan Party, within the meaning of Section
414 of the Internal Revenue Code.
"ERISA EVENT" means (a) (i) the occurrence of a reportable
event, within the meaning of Section 4043 of ERISA, with respect to any
Plan unless the 30-day notice requirement with respect to such event
has been waived by the PBGC; or (ii) the requirements of subsection (1)
of Section 4043(b) of ERISA (without regard to subsection (2) of such
Section) are met with respect to a contributing sponsor, as defined in
Section 4001(a)(13) of ERISA, of a Plan, and an event described in
paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is
reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver
with respect to a Plan; (c) the provision by the administrator of any
Plan of a notice of intent to terminate such Plan, pursuant to Section
4041(a)(2) of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA); (d) the cessation
of operations at a facility of any Loan Party or any ERISA Affiliate in
the circumstances
12
described in Section 4062(e) of ERISA; (e) the withdrawal by any Loan
Party or any ERISA Affiliate from a Multiple Employer Plan during a
plan year for which it was a substantial employer, as defined in
Section 4001(a)(2) of ERISA; (f) the conditions for imposition of a
lien under Section 302(f) of ERISA shall have been met with respect to
any Plan; (g) the adoption of an amendment to a Plan requiring the
provision of security to such Plan, pursuant to Section 307 of ERISA;
or (h) the institution by the PBGC of proceedings to terminate a Plan
pursuant to Section 4042 of ERISA, or the occurrence of any event or
condition described in Section 4042 of ERISA that constitutes grounds
for the termination of, or the appointment of a trustee to administer,
such Plan.
"EUROCURRENCY LIABILITIES" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Lender
Party, the office of such Lender Party specified as its "Eurodollar
Lending Office" opposite its name on Schedule I hereto or in the
Assignment and Acceptance pursuant to which it became a Lender Party
(or, if no such office is specified, its Domestic Lending Office), or
such other office of such Lender
13
Party as such Lender Party may from time to time specify to the
Borrower and the Administrative Agent.
"EURODOLLAR RATE" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the average of the respective rates per annum (rounded
upward to the next whole multiple of 1/16th of 1%) posted by each of
the principal London offices of banks posting rates as displayed on the
Dow Xxxxx Markets screen, page 3750 or such other page as may replace
such page on such service for the purpose of displaying the London
interbank offered rate of major banks for deposits in U.S. Dollars, at
approximately 11:00 A.M. (London time) two Business Days before the
first day of such Interest Period for deposits in an amount
substantially equal to BNP's Eurodollar Rate Advance comprising part of
such Borrowing to be outstanding during such Interest Period (or, if
BNP shall not have such a Eurodollar Rate Advance, $1,000,000) and for
a period equal to such Interest Period by (b) a percentage equal to
100% minus the Eurodollar Rate Reserve Percentage for such Interest
Period.
"EURODOLLAR RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.07(a)(ii).
"EURODOLLAR RATE RESERVE PERCENTAGE" for any Interest Period
for all Eurodollar Rate Advances comprising part of the same Borrowing
means the reserve percentage applicable two Business Days before the
first day of such Interest Period under regulations issued from time to
time by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement (including,
without limitation, any emergency, supplemental or other marginal
reserve requirement) for a member bank of the Federal Reserve System in
New York City with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities (or with respect to any other
category of liabilities that includes deposits by reference to which
the interest rate on Eurodollar Rate Advances is determined) having a
term equal to such Interest Period.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCESS CASH FLOW" means, for any period,
(a) the sum of:
(i) Consolidated net income (or loss) of the Borrower
and its Subsidiaries for such period; plus
(ii) the aggregate amount of all noncash charges
deducted in arriving at Consolidated net income (or loss) of
the Borrower and its Subsidiaries for each such period; plus
(iii) an amount (whether positive or negative) equal
to the change in Consolidated Current Liabilities of the
Borrower and its Subsidiaries during such period; plus
(iv) any Carryover Amount from a prior period to the
extent not so used during the period then ended; less
(b) the sum of:
(i) the aggregate amount of all noncash credits
included in arriving at such Consolidated net income (or loss)
the Borrower and its Subsidiaries; plus
14
(ii) an amount (whether positive or negative) equal
to the change in Consolidated Current Assets (excluding cash
and Cash Equivalents) of the Borrower and its Subsidiaries
during such period; plus
(iii) an amount equal to the amount of all Capital
Expenditures of the Borrower and its Subsidiaries paid in cash
during such period to the extent permitted by this Agreement;
plus
(iv) an amount equal to the aggregate amount of all
regularly scheduled principal payments of Funded Debt made
during such period, together with any optional prepayments of
Term Advances made during such period in accordance with
Section 2.06(a); plus
(v) the Carryover Amount for the period then ended
permitted to be carried over to the next Fiscal Year.
"EXISTING DEBT" means Debt of the Borrower, each Loan Party
and their respective Subsidiaries outstanding immediately before the
consummation of the Transactions.
"EXTRAORDINARY RECEIPT" means any cash received by or paid to
or for the account of any Person not in the ordinary course of
business, including, without limitation, tax refunds, pension plan
reversions, proceeds of insurance (excluding proceeds of business
interruption insurance to the extent such proceeds constitute
compensation for lost earnings), condemnation awards (and payments in
lieu thereof), indemnity payments and any purchase price adjustment
received in connection with any purchase and sale agreement; provided,
however, that an Extraordinary Receipt shall not include cash receipts
received from proceeds of insurance or indemnity payments to the extent
that such proceeds or payments (A) in respect of loss or damage to
equipment, fixed assets or real property are applied (or in respect of
which expenditures were previously incurred) to replace or repair the
equipment, fixed assets or real property in respect of which such
proceeds were received in accordance with the terms of the Loan
Documents, so long as such application is made (or such expenditures
were incurred) within nine months after the occurrence of such damage
or loss or (B) are received by a Person in respect of any third party
claim against such Person and applied to pay (or reimburse such Person
for its prior payment of) such claim and the costs and expenses of such
Person with respect thereto.
"FACILITY" means the Term A Facility, the Working Capital
Facility, the Swing Line Facility or the Letter of Credit Facility.
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate per annum equal for each day during such period (i) to
the rate published by the Dow Xxxxx Markets service on page five of its
daily report as the "ASK" rate as of 10:00 A.M. (New York City time)
for such day (or, if such day is not a Business Day, for the
immediately preceding Business Day) or (ii) if the Dow Xxxxx Markets
service shall cease to publish or otherwise shall not publish such
rates for any day that is a Business Day, to the weighted average of
the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers, as published
for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day that is a Business Day, the
average of the quotations for such day for such transactions received
by the Administrative Agent from three Federal funds brokers of
recognized standing selected by it.
"FEE LETTERS" means each agreement entered into between any
Loan Party and any Agent, the Issuing Bank or the Arranger with respect
to the payment of fees or other amounts relating to the Facilities.
15
"FISCAL QUARTER" means a fiscal quarter ending on or about
March 31, June 30, September 30 or December 31 of each year.
"FISCAL YEAR" means a fiscal year of the Borrower and its
Consolidated Subsidiaries ending on the Sunday nearest December 31 in
any calendar year.
"FIXED CHARGE COVERAGE RATIO" means, with respect to any
Person for any Rolling Period, the ratio of (a) Consolidated EBITDA for
such Person and its Subsidiaries for such Rolling Period less the sum
of (i) Capital Expenditures of such Person and its Subsidiaries during
such Rolling Period and (ii) income taxes of such Person and its
Subsidiaries that have been paid in cash during such Rolling Period to
(b) the sum of (i) Interest Expense of such Person and its Subsidiaries
for such Rolling Period, and (ii) regularly scheduled principal
payments of Funded Debt of such Person and its Subsidiaries made during
such Rolling Period; provided, however, that, with respect to each
calculation made prior to the expiration of four fiscal quarters after
the date of the Initial Extension of Credit, amounts determined with
respect to clause (b)(i) above shall be calculated by multiplying such
amount from and after November 1, 1999 of the Initial Extension of
Credit by the Annualization Factor.
"FOREIGN SUBSIDIARY" means a Subsidiary that is organized
under the laws of a jurisdiction other than the United States or any
State thereof or the District of Columbia.
"FUNDED DEBT" of any Person means Debt of such Person (other
than Debt described in clauses (f) and (h) of the definition thereof)
that by its terms matures more than one year after the date of creation
or matures within one year from such date but is renewable or
extendible, at the option of such Person, to a date more than one year
after such date or arises under a revolving credit or similar agreement
that obligates the lender or lenders to extend credit during a period
of more than one year after such date, including, without limitation,
all amounts of Funded Debt of such Person required to be paid or
prepaid within one year after the date of determination.
"GAAP" has the meaning specified in Section 1.03.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum
products, by-products or breakdown products, radioactive materials,
asbestos-containing materials, polychlorinated biphenyls and radon gas
and (b) any other chemicals, materials or substances designated,
classified or regulated as hazardous or toxic or as a pollutant or
contaminant under any Environmental Law.
"HEDGE AGREEMENTS" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other hedging
agreements.
"HEDGE BANK" means any Lender Party or any of its Affiliates
in its capacity as a party to a Secured Hedge Agreement.
"INDEMNIFIED PARTY" has the meaning specified in
Section 8.04(b).
"INFORMATION MEMORANDUM" means the Confidential Information
Memorandum dated September 1999 prepared for the purposes of the bank
meeting held in September, 1999.
"INITIAL EXTENSION OF CREDIT" means the earlier to occur of
the initial Borrowing hereunder and the initial issuance of a Letter of
Credit hereunder.
"INITIAL GUARANTORS" means each of the Subsidiaries of the
Borrower set forth in Schedule 3.01(a)(v) hereto.
16
"INITIAL ISSUING BANK", has the meaning specified in the
recital of parties to this Agreement.
"INITIAL LENDER PARTIES" and "INITIAL LENDERS" each have the
meaning specified in the recital of parties to this Agreement.
"INSUFFICIENCY" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
"INTERCOMPANY NOTES" has the meaning specified in Section
3.01(a)(xx) and shall be in form and substance satisfactory to the
Administrative Agent.
"INTEREST COVERAGE RATIO" means, with respect to any Person
for any Rolling Period, the ratio of (a) Consolidated EBITDA of such
Person and its Subsidiaries for such Rolling Period to (b) Interest
Expense of such Person and its Subsidiaries for such Rolling Period;
provided, however, that, with respect to each calculation made prior to
the expiration of four fiscal quarters after the date of the date of
the Initial Extension of Credit, Interest Expense will be calculated by
multiplying such amount by the Annualization Factor.
"INTEREST EXPENSE" means, with respect to any Person for any
period, interest expense (including the interest component on
obligations under Capitalized Leases), whether paid or accrued, on all
Debt of such Person and its Subsidiaries for such period, including,
without limitation and without duplication, (a) interest expense in
respect of Debt resulting from Advances, (b) commissions, discounts and
other fees and charges payable in connection with letters of credit
(including, without limitation, any Letters of Credit), (c) any net
payment payable in connection with Hedge Agreements less any net
credits received in connection with Hedge Agreements and (d) all other
noncash interest but excluding amortization with respect to deferred
financing fees.
"INTEREST PERIOD" means, for each Eurodollar Rate Advance
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advance or the date of the Conversion of
any Base Rate Advance into such Eurodollar Rate Advance, and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below and, thereafter, each subsequent period commencing on
the last day of the immediately preceding Interest Period and ending on
the last day of the period selected by the Borrower pursuant to the
provisions below. The duration of each such Interest Period shall be
one, two, three or six months, as the Borrower may, upon notice
received by the Administrative Agent not later than 12:00 P.M. (New
York City time) on the third Business Day prior to the first day of
such Interest Period, select; provided, however, that:
(a) the Borrower may not select any Interest
Period with respect to any Eurodollar Rate Advance under a
Facility that ends after any principal repayment installment
date for such Facility unless, after giving effect to such
selection, the aggregate principal amount of Base Rate
Advances and of Eurodollar Rate Advances having Interest
Periods that end on or prior to such principal repayment
installment date for such Facility shall be at least equal to
the aggregate principal amount of Advances under such Facility
due and payable on or prior to such date;
(b) Interest Periods commencing on the same
date for Eurodollar Rate Advances comprising part of the same
Borrowing shall be of the same duration;
(c) whenever the last day of any Interest
Period would otherwise occur on a day other than a Business
Day, the last day of such Interest Period shall be extended to
occur on the next succeeding Business Day, provided, however,
that, if
17
such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the immediately
preceding Business Day; and
(d) whenever the first day of any Interest
Period occurs on a day of an initial calendar month for which
there is no numerically corresponding day in the calendar
month that succeeds such initial calendar month by the number
of months equal to the number of months in such Interest
Period, such Interest Period shall end on the last Business
Day of such succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
rulings issued thereunder.
"INVENTORY" means all Inventory of the kind described in
Section 1(b) of the Security Agreement and the granting clause of each
Non-U.S. Security Agreement.
"INVESTMENT" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any Equity Interests or
Debt or the assets comprising a division or business unit or a
substantial part or all of the business of such Person, any capital
contribution to such Person or any other direct or indirect investment
in such Person, including, without limitation, any acquisition by way
of a merger or consolidation and any arrangement pursuant to which the
investor incurs Debt of the types referred to in clause (i) or (j) of
the definition of "DEBT" in respect of such Person.
"ISSUING BANK" means the Initial Issuing Bank, and any other
Working Capital Lender approved as an Issuing Bank by the
Administrative Agent and each Eligible Assignee to which a Letter of
Credit Commitment hereunder has been assigned pursuant to Section 8.07,
for so long as such Initial Issuing Bank or Eligible Assignee, as the
case may be, shall have a Letter of Credit Commitment.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified in the
Security Agreement.
"L/C RELATED DOCUMENTS" has the meaning specified in Section
2.04(d)(ii).
"LENDER PARTY" means any Lender, the Swing Line Bank or the
Issuing Bank.
"LENDERS" means the Initial Lenders and each Person that shall
become a Lender hereunder pursuant to Section 8.07 for so long as such
Initial Lender or Person shall be a party to this Agreement.
"XXXXXX GROUP" means Xxxxxxx Xxxxxx and any Person that is,
directly or indirectly, controlled by Xxxxxxx Xxxxxx.
"LETTER OF CREDIT ADVANCE" means an advance made by the
Issuing Bank or any Working Capital Lender pursuant to Section 2.03(c).
"LETTER OF CREDIT AGREEMENT" has the meaning specified in
Section 2.03(a).
"LETTER OF CREDIT COMMITMENT" means, with respect to the
Issuing Bank at any time, the amount set forth opposite the Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit
Commitment" or, if the Issuing Bank has entered into an Assignment and
Acceptance, set forth for the Issuing Bank in the Register maintained
by the Administrative Agent pursuant to Section 8.07(d) as the Issuing
Bank's "Letter of Credit Commitment", as such amount may be reduced at
or prior to such time pursuant to Section 2.05.
18
"LETTER OF CREDIT FACILITY" means, at any time, an amount
equal to the amount of the Issuing Bank's Letter of Credit Commitment
at such time, as such amount may be reduced at or prior to such time
pursuant to Section 2.05.
"LETTERS OF CREDIT" has the meaning specified in Section
2.01(d).
"LEVERAGE RATIO" means, with respect to any Person for any
Rolling Period, the ratio of Funded Debt of such Person and its
Subsidiaries as of the last day of any Rolling Period to (b)
Consolidated EBITDA of such Person and its Subsidiaries for such
Rolling Period.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
"LOAN DOCUMENTS" means (a) for purposes of this Agreement and
the Notes, if any, and any amendment, supplement or modification hereof
or thereof, (i) this Agreement, (ii) the Notes, (iii) the Collateral
Documents, (iv) each Letter of Credit Agreement, (v) the Subsidiary
Guaranty and the Subsidiary Guaranty - Canada and (vi) the Fee Letters,
and (b) for purposes of the Collateral Documents and for all other
purposes other than for purposes of this Agreement and the Notes, (i)
this Agreement, (ii) the Notes, if any, (iii) the Collateral Documents,
(iv) each Letter of Credit Agreement, (v) the Subsidiary Guaranty and
the Subsidiary Guaranty - Canada and (vi) the Fee Letters, (vii) each
Secured Hedge Agreement and (viii) any other agreement, document or
instrument issued pursuant to or in connection with any of the
foregoing, and in each case as amended, amended and restated,
supplemented or otherwise modified from time to time.
"LOAN PARTIES" means the Borrower, each Initial Guarantor and
each other Person who is required under the terms of Section 5.01(j) to
execute and deliver a guaranty or guaranty supplement or to execute and
deliver a mortgage, pledge, assignment, security agreement supplement
or other security agreement.
"LOAN VALUE" means an amount equal to the sum of the
percentage of the value of each item of Eligible Collateral of up to
the following amounts:
(a) with respect to inventory up to 50% of the value
of Eligible Inventory, and
(b) with respect to receivables, up to 85% of the
value of Eligible Receivables,
provided, however, that the Administrative Agent may, in its reasonable
discretion following an audit field examination and based on its
analysis of changes in any Loan Party's operations or credit and
collection experience arising after the date hereof that may dilute the
value of Eligible Collateral, revise from time to time the percentage
of the value of any individual item of Eligible Collateral that shall
be used in determining Loan Value.
"MARGIN STOCK" has the meaning specified in Regulation U.
"MATERIAL ADVERSE CHANGE" means any material adverse change in
the business, condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries taken as
a whole.
19
"MATERIAL ADVERSE EFFECT" means a material adverse effect on
(a) the business, condition (financial or otherwise), operations,
performance or properties of the Borrower and its Subsidiaries taken as
a whole, (b) the rights and remedies of the Administrative Agent or any
Lender Party under any Transaction Document or (c) the ability of the
Borrower and its Subsidiaries taken as a whole to perform their
Obligations under any Transaction Document to which they are or are to
become parties.
"MATERIAL SUBSIDIARY" means, at any time, any Subsidiary that
is wholly owned (other than directors qualifying shares), directly or
indirectly, by the Borrower other than a Subsidiary with total assets
less than $50,000.
"MULTIEMPLOYER PLAN" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which any Loan Party or any ERISA
Affiliate is making or accruing an obligation to make contributions, or
has within any of the preceding five plan years made or accrued an
obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and at least one
Person other than the Loan Parties and the ERISA Affiliates or (b) was
so maintained and in respect of which any Loan Party or any ERISA
Affiliate could have liability under Section 4064 or 4069 of ERISA in
the event such plan has been or were to be terminated.
"NET CASH PROCEEDS" means, with respect to any sale, lease,
transfer or other disposition of any asset or the incurrence or
issuance of any Debt or capital stock or other ownership or profit
interest (including, without limitation, any capital contribution), any
securities convertible into or exchangeable for capital stock or other
ownership or profit interest or any warrants, rights, options or other
securities to acquire capital stock or other ownership or profit
interest by any Person, or any Extraordinary Receipt received by or
paid to or for the account of any Person, the aggregate amount of cash
received from time to time (whether as initial consideration or through
payment or disposition of deferred consideration) by or on behalf of
such Person in connection with such transaction after deducting
therefrom only (without duplication) (a) reasonable and customary
brokerage commissions, underwriting fees and discounts, legal fees,
finder's fees and other similar fees and commissions, (b) the amount of
taxes payable in connection with or as a result of such transaction and
(c) the amount of any Debt secured by a Lien on such asset that, by the
terms of such transaction, is required to be repaid upon such
disposition, in each case to the extent, but only to the extent, that
the amounts so deducted are properly attributable to such transaction
or to the asset that is the subject thereof and are, in the case of
clauses (a) and (c), at the time of receipt of such cash, actually paid
to a Person that is not an Affiliate of such Person or any Loan Party
or any Affiliate of any Loan Party and, in the case of clause (b), on
the earlier of the dates on which the tax return covering such taxes is
filed or required to be filed, provided, however, that in the case of
taxes that are deductible under clause (b) but for the fact that at the
time of receipt of such cash, such taxes have not been actually paid or
are not then payable, such Person may deduct an amount (the "RESERVED
AMOUNT") equal to the amount reserved in accordance with GAAP as a
reasonable estimate for such taxes, other than taxes for which such
Loan Party or such Subsidiary is indemnified, provided further,
however, that at the time such taxes are paid, an amount equal to the
amount, if any, by which the Reserved Amount exceeds the amount
actually so paid, the amount of such excess shall constitute "Net Cash
Proceeds".
"NON-U.S. SECURITY AGREEMENT" means each of the security
agreements securing the obligations of the makers of the Intercompany
Notes under the Intercompany Notes and the obligations of the Loan
Parties under the Loan Documents, in form and substance acceptable to
the Administrative Agent, duly executed by each Initial Guarantor or
such other Foreign
20
Subsidiary which is a Material Subsidiary as may from time to time be
requested by the Administrative Agent.
"NON-U.S. SUBSIDIARY GUARANTY" means a guaranty made by each
Foreign Subsidiary which is also a Material Subsidiary (other than any
Foreign Subsidiary which is a Material Subsidiary which executes the
Canadian Subsidiary Guaranty), in substantially the form of Exhibit E-3
(together with each other guaranty made by a Foreign Subsidiary which
is Material Subsidiary delivered pursuant to Section 5.01(j), in each
case as amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with its terms).
"NOTE" means a Term A Note or a Working Capital Note, in each
case to the extent required to be issued pursuant to Section 2.15.
"NOTICE OF BORROWING" has the meaning specified in Section
2.02(a).
"NOTICE OF ISSUANCE" has the meaning specified in Section
2.03(a).
"NOTICE OF SWING LINE BORROWING" has the meaning specified in
Section 2.02(b).
"NPL" means the National Priorities List under CERCLA.
"OBLIGATION" means, with respect to any Person, any payment,
performance or other obligation of such Person of any kind, including,
without limitation, any liability of such Person on any claim, whether
or not the right of any creditor to payment in respect of such claim is
reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, disputed, undisputed, legal, equitable, secured or unsecured,
and whether or not such claim is discharged, stayed or otherwise
affected by any proceeding referred to in Section 6.01(f). Without
limiting the generality of the foregoing, the Obligations of any Loan
Party under the Loan Documents include (a) the obligation to pay
principal, interest, Letter of Credit commissions, charges, expenses,
fees, attorneys' fees and disbursements, indemnities and other amounts
payable by such Loan Party under any Loan Document and (b) the
obligation of such Loan Party to reimburse any amount in respect of any
of the foregoing that any Lender Party, in its sole discretion, may
elect to pay or advance on behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"OPEN YEAR" has the meaning specified in Section 4.01(o).
"OTHER TAXES" has the meaning specified in Section 2.12(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any
successor thereto.
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (a) Liens for taxes, assessments and
governmental charges or levies to the extent not required to be paid
under Section 5.01(b) hereof; (b) Liens imposed by law, such as
materialmen's, mechanics', carriers', workmen's and repairmen's Liens
and other similar Liens arising in the ordinary course of business
securing obligations that (i) are not overdue for a period of more than
30 days and (ii) either individually or when aggregated with all other
Permitted Liens outstanding on any date of determination, do not
materially affect the use or value of any material property of the Loan
Parties; (c) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations; (d) easements, rights of way and other
encumbrances on title to real property that do not render title to any
material property of the Loan Parties thereby unmarketable or
materially
21
adversely affect the use of such property for its present purposes,
and (e) judgment Liens with respect to any of the foregoing that are
stayed or discharged within 45 days.
"PERSON" means an individual, partnership, corporation
(including a business trust), limited liability company, joint stock
company, trust, unincorporated association, joint venture or other
entity, or a government or any political subdivision or agency thereof.
"PLAN" means a Single Employer Plan or a Multiple Employer
Plan.
"PLEDGED DEBT" has the meaning specified in Section 1(d) of
the Security Agreement.
"PLEDGED SHARES" has the meaning specified in Section 1(d) of
the Security Agreement.
"PREFERRED INTERESTS" means, with respect to any Person,
Equity Interests issued by such Person that are entitled to a
preference or priority over any other Equity Interests issued by such
Person upon any distribution of such Person's property and assets,
whether by dividend or upon liquidation.
"PRO RATA SHARE" of any amount means, with respect to any
Working Capital Lender at any time, the product of such amount times a
fraction the numerator of which is the amount of such Lender's Working
Capital Commitment at such time (or, if the Commitments shall have been
terminated, the Working Capital Commitment as in effect immediately
prior to such termination) and the denominator of which is the Working
Capital Facility at such time (or, if the Commitments shall have been
terminated, the Working Capital Facility as in effect immediately prior
to such termination).
"RECEIVABLES" means all Receivables referred to in Section
1(c) of the Security Agreement.
"REDEEMABLE" means, with respect to any Equity Interest, any
Debt or any other right or Obligation, any such Equity Interest, Debt,
right or Obligation that (a) the issuer has undertaken to redeem at a
fixed or determinable date or dates, whether by operation of a sinking
fund or otherwise, or upon the occurrence of a condition not solely
within the control of the issuer or (b) is redeemable at the option of
the holder.
"REDUCTION AMOUNT" has the meaning specified in Section
2.06(b)(v).
"REGISTER" has the meaning specified in Section 8.07(d).
"REGULATION U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"RELATED DOCUMENTS" means the Hedge Agreements and the
Intercompany Notes.
"REQUIRED LENDERS" means, at any time, Lenders owed or holding
at least a majority in interest of the sum of (a) the aggregate
principal amount of the Advances outstanding at such time, (b) the
aggregate Available Amount of all Letters of Credit outstanding at such
time, (c) the aggregate unused Commitments under the Term A Facility at
such time and (d) the aggregate Unused Working Capital Commitments at
such time. For purposes of this definition, the aggregate principal
amount of Swing Line Advances owing to the Swing Line Bank and of
Letter of Credit Advances owing to the Issuing Bank and the Available
Amount of each Letter of Credit shall be considered to be owed to the
Working Capital Lenders ratably in accordance with their respective
Working Capital Commitments.
22
"RESPONSIBLE OFFICER" means any executive officer of the
Borrower.
"ROLLING PERIOD" means, for any Fiscal Quarter, the
consecutive four Fiscal Quarters ending on the last day of such Fiscal
Quarter.
"SAFETY 3232301" means 3232301 Canada, Inc., a wholly owned
Subsidiary of the Borrower amalgamated and existing under the laws of
Canada.
"SAFETY CANADA" means Safety 1st Home Products Canada, Inc., a
wholly owned Subsidiary of Safety 3232301 amalgamated and existing
under the laws of Canada.
"SAFETY EUROPE" means Safety 1st (Europe) Limited, a wholly
owned Subsidiary of the Borrower duly incorporated under the laws of
England and Wales.
"SECURED HEDGE AGREEMENT" means any Hedge Agreement required
or permitted under Article V that is entered into by and between the
Borrower and any Hedge Bank.
"SECURED OBLIGATIONS" has the meaning specified in the
Security Agreement.
"SECURED PARTIES" means the Agents, the Lender Parties and the
Hedge Banks.
"SECURITY AGREEMENT" has the meaning specified in Section
3.01(a)(iii).
"SINGLE EMPLOYER PLAN" means a single employer plan, as
defined in Section 4001(a)(15) of ERISA, that (a) is maintained for
employees of any Loan Party or any ERISA Affiliate and no Person other
than the Loan Parties and the ERISA Affiliates or (b) was so maintained
and in respect of which any Loan Party or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has
been or were to be terminated.
"SOLVENT" and "SOLVENCY" mean, with respect to any Person on a
particular date, that on such date (a) the fair value of the property
of such Person is greater than the total amount of liabilities,
including, without limitation, the probable amount of contingent
liabilities, of such Person, (b) 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, (c) such Person does not intend to, and
does not believe that it will, incur debts or liabilities beyond such
Person's ability to pay such debts and liabilities as they mature and
(d) such Person is not engaged in business or a transaction, and is not
about to engage in business or a transaction, for which such Person's
property would constitute an unreasonably small capital. The amount of
contingent liabilities at any time shall be computed as the amount
that, in the 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.
"STANDBY LETTER OF CREDIT" means any Letter of Credit issued
under the Letter of Credit Facility, other than a Trade Letter of
Credit.
"SUBSIDIARY" of any Person means any corporation, partnership,
joint venture, limited liability company, trust or estate of which (or
in which) more than 50% of (a) the issued and outstanding capital stock
having ordinary voting power to elect a majority of the Board of
Directors of such corporation (irrespective of whether at the time
capital stock of any other class or classes of such corporation shall
or might have voting power upon the occurrence of any contingency), (b)
the interest in the capital or profits of such limited liability
company, partnership or joint venture or (c) the beneficial interest in
such trust or estate, is at the time directly or indirectly owned or
controlled by such Person, by such Person and one or more of its other
Subsidiaries or by one or more of such Person's other Subsidiaries.
23
"SUBSIDIARY GUARANTY" means a guaranty in substantially the
form of Exhibit E-1 (together with each other guaranty (other than each
Subsidiary Guaranty - Canada) delivered pursuant to Section 5.01(j), in
each case as amended, amended and restated, supplemented or otherwise
modified from time to time in accordance with its terms).
"SUBSIDIARY GUARANTY - CANADA" means a guaranty in
substantially the form of Exhibit E-2 required to be given by each
Material Subsidiary that is organized under the laws of Canada
(together with each other guaranty delivered pursuant to Section
5.01(j) by a Person organized under the laws of Canada, in each case as
amended, amended and restated, supplemented or otherwise modified from
time to time in accordance with its terms).
"SURVIVING DEBT" means Debt of each Loan Party and its
Subsidiaries outstanding immediately before and after giving effect to
the Transactions.
"SWING LINE ADVANCE" means an advance made by (a) the Swing
Line Bank pursuant to Section 2.01(c) or (b) any Working Capital Lender
pursuant to Section 2.02(b).
"SWING LINE BANK" has the meaning specified in the recital of
parties to this Agreement.
"SWING LINE BORROWING" means a borrowing consisting of a Swing
Line Advance made by the Swing Line Bank pursuant to Section 2.01(c) or
the Working Capital Lenders pursuant to Section 2.02(b).
"SWING LINE COMMITMENT" means, with respect to the Swing Line
Bank at any time, the amount set forth opposite the Swing Line Bank's
name on Schedule I hereto under the caption "Swing Line Commitment" or,
if the Swing Line Bank has entered into an Assignment and Acceptance,
set forth for the Swing Line Bank in the Register maintained by the
Administrative Agent pursuant to Section 8.07(d) as the Swing Line
Bank's "Swing Line Commitment", as such amount may be reduced at or
prior to such time pursuant to Section 2.05.
"SWING LINE FACILITY" has the meaning specified in Section
2.01(c).
"SYNDICATION AGENT" has the meaning specified in the recital
of parties to this Agreement.
"TAX CERTIFICATE" has the meaning specified in Section
5.03(l).
"TAXES" has the meaning specified in Section 2.12(a).
"TERM A ADVANCE" has the meaning specified in Section 2.01(a).
"TERM A BORROWING" means a borrowing consisting of
simultaneous Term A Advances of the same Type made by the Term A
Lenders.
"TERM A COMMITMENT" means, with respect to any Term A Lender
at any time, the amount set forth opposite such Lender's name on
Schedule I hereto under the caption "Term A Commitment" or, if such
Lender has entered into one or more Assignment and Acceptances, the
aggregate amount set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to Section 8.07(d) as such
Lender's "Term A Commitment".
"TERM A FACILITY" means, at any time, the aggregate amount of
the Term A Lenders' Term A Commitments at such time.
24
"TERM A LENDER" means any Lender that has a Term A Commitment.
"TERM A NOTE" means a promissory note of the Borrower payable
to the order of any Term A Lender, in substantially the form of Exhibit
A-1 hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term A Advances made by such Lender to the extent
required to be issued pursuant to Section 2.15.
"TERM ADVANCE" means a Term A Advance or such other term
advance as may be permitted from time to time in accordance with the
terms of this Agreement.
"TERM COMMITMENT" means a Term A Commitment or any other term
commitment as may be permitted from time to time in accordance with the
terms of this Agreement.
"TERM FACILITIES" means the Term A Facility and any other term
facility as may be permitted from time to time in accordance with the
terms of this Agreement.
"TERM LENDER" means a Term A Lender or any other Lender that
from time to time has a Term Commitment in accordance with the terms of
this Agreement.
"TERMINATION DATE" means (a) for purposes of the Working
Capital Facility, the Swing Line Facility and the Letter of Credit
Facility, the earlier of (x) September 30, 2004 and (y) the date of
termination in whole of the Term Commitments, the Swing Line
Commitment, the Letter of Credit Commitment and the Working Capital
Commitments pursuant to Section 2.05 or 6.01 (the "COMMITMENT
TERMINATION DATE"), and (b) for purposes of the Term A Facility, the
earlier of (x) September 30, 2005 and (y) the Commitment Termination
Date.
"TRADE LETTER OF CREDIT" means any Letter of Credit that is
issued under the Letter of Credit Facility for the benefit of a
supplier of Inventory to the Borrower or any of its Subsidiaries to
effect payment for such Inventory.
"TRANSACTION" means the refinancing of certain Existing Debt
and the other transactions contemplated by the Transaction Documents.
"TRANSACTION DOCUMENTS" means, collectively, the Loan
Documents and the Related Documents.
"TYPE" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"UNUSED WORKING CAPITAL COMMITMENT" means, with respect to any
Working Capital Lender at any time, (a) such Lender's Working Capital
Commitment at such time minus (b) the sum of (i) the aggregate
principal amount of all Working Capital Advances, Swing Line Advances
and Letter of Credit Advances made by such Lender (in its capacity as a
Lender) and outstanding at such time, plus (ii) such Lender's Pro Rata
Share of (A) the aggregate Available Amount of all Letters of Credit
outstanding at such time, (B) the aggregate principal amount of all
Letter of Credit Advances made by the Issuing Bank pursuant to Section
2.03(c) and outstanding at such time and (C) the aggregate principal
amount of all Swing Line Advances made by the Swing Line Bank pursuant
to Section 2.01(c) and outstanding at such time.
"VOTING INTERESTS" means shares of capital stock issued by a
corporation, or equivalent Equity Interests in any other Person, the
holders of which are ordinarily, in the absence of contingencies,
entitled to vote for the election of directors (or persons performing
25
similar functions) of such Person, even if the right so to vote has
been suspended by the happening of such a contingency.
"WELFARE PLAN" means a welfare plan, as defined in Section
3(1) of ERISA, that is maintained for employees of any Loan Party or in
respect of which any Loan Party could have a liability.
"WITHDRAWAL LIABILITY" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
"WORKING CAPITAL ADVANCE" has the meaning specified in Section
2.01(b).
"WORKING CAPITAL BORROWING" means a borrowing consisting of
simultaneous Working Capital Advances of the same Type made by the
Working Capital Lenders.
"WORKING CAPITAL COMMITMENT" means, with respect to any
Working Capital Lender at any time, the amount set forth opposite such
Lender's name on Schedule I hereto under the caption "Working Capital
Commitment" or, if such Lender has entered into one or more Assignment
and Acceptances, set forth for such Lender in the Register maintained
by the Administrative Agent pursuant to Section 8.07(d) as such
Lender's "Working Capital Commitment", as such amount may be reduced at
or prior to such time pursuant to Section 2.05.
"WORKING CAPITAL FACILITY" means, at any time, the aggregate
amount of the Working Capital Lenders' Working Capital Commitments at
such time.
"WORKING CAPITAL LENDER" means any Lender that has a Working
Capital Commitment.
"WORKING CAPITAL NOTE" means a promissory note of the Borrower
payable to the order of any Working Capital Lender, in substantially
the form of Exhibit A-2 hereto, evidencing the aggregate indebtedness
of the Borrower to such Lender resulting from the Working Capital
Advances, Letter of Credit Advances and Swing Line Advances made by
such Lender to the extent required to be issued pursuant to Section
2.15.
SECTION 1.02. COMPUTATION OF TIME PERIODS; OTHER DEFINITIONAL
PROVISIONS. In this Agreement and the other Loan Documents, in the computation
of periods of time from a specified date to a later specified date, the word
"from" means "from and including" and the words "to" and "until" each mean "to
but excluding". References in the Loan Documents to any agreement or contract
"as amended" shall mean and be a reference to such agreement or contract as
amended, amended and restated, supplemented or otherwise modified from time to
time in accordance with its terms.
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(f) ("GAAP").
26
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES
AND THE LETTERS OF CREDIT
SECTION 2.01. THE ADVANCES AND THE LETTERS OF CREDIT. (a) THE
TERM A ADVANCES. Each Term A Lender severally agrees, on the terms and
conditions hereinafter set forth, to make a single advance (a "TERM A ADVANCE")
to the Borrower on any Business Day during the period from the date hereof until
October 21, 1999 in an amount not to exceed such Lender's Term A Commitment at
such time. The Term A Borrowing shall consist of Term A Advances made
simultaneously by the Term A Lenders ratably according to their Term A
Commitments. Amounts borrowed under this Section 2.01(a) and repaid or prepaid
may not be reborrowed.
(b) THE WORKING CAPITAL ADVANCES. Each Working Capital Lender
severally agrees, on the terms and conditions hereinafter set forth, to make
advances (each a "WORKING CAPITAL ADVANCE") to the Borrower from time to time on
any Business Day during the period from the date hereof until the Termination
Date in an amount for each such Advance not to exceed such Lender's Unused
Working Capital Commitment at such time. Each Working Capital Borrowing shall be
in an aggregate amount of $1,000,000 or an integral multiple of $100,000 in
excess thereof (other than a Borrowing the proceeds of which shall be used
solely to repay or prepay in full outstanding Letter of Credit Advances made by
the Issuing Bank or Swing Line Advances made by the Swing Line Bank) and shall
consist of Working Capital Advances made simultaneously by the Working Capital
Lenders ratably according to their Working Capital Commitments. Within the
limits of each Working Capital Lender's Unused Working Capital Commitment in
effect from time to time, the Borrower may borrow under this Section 2.01(b),
prepay pursuant to Section 2.06(a) and reborrow under this Section 2.01(b).
(c) THE SWING LINE ADVANCES. The Borrower may request the
Swing Line Bank to make, and the Swing Line Bank agrees, on the terms and
conditions hereinafter set forth, to make a Swing Line Advance from time to time
on any Business Day during the period from the date hereof until the Termination
Date (i) in an aggregate amount not to exceed at any time outstanding $5,000,000
(the "SWING LINE FACILITY") and (ii) in an amount for each such Swing Line
Borrowing not to exceed the aggregate of the Unused Working Capital Commitments
of the Working Capital Lenders at such time. No Swing Line Advance shall be used
for the purpose of funding the payment of principal of any other Swing Line
Advance. Each Swing Line Borrowing shall be in an amount of $250,000 or an
integral multiple of $100,000 in excess thereof and shall be made as a Base Rate
Advance. Within the limits of the Swing Line Facility and within the limits
referred to in clause (ii) above, so long as the Swing Line Bank makes Swing
Line Advances, the Borrower may borrow under this Section 2.01(c), repay
pursuant to Section 2.04(c) or prepay pursuant to Section 2.06(a) and reborrow
under this Section 2.01(c).
(d) LETTERS OF CREDIT. The Issuing Bank agrees, on the terms
and conditions hereinafter set forth, to issue letters of credit (the "LETTERS
OF CREDIT") for the account of the Borrower from time to time on any Business
Day during the period from the date hereof until 60 days before the Termination
Date in an aggregate Available Amount (i) for all Letters of Credit not to
exceed at any time the lesser of (x) the Letter of Credit Facility at such time
and (y) the Issuing Bank's Letter of Credit Commitment at such time and (ii) for
each such Letter of Credit not to exceed Unused Working Capital Commitments of
the Working Capital Lenders at such time. No Letter of Credit shall have an
expiration date (including all rights of the Borrower or the beneficiary to
require renewal) later than the earlier of 60 days before the Termination Date
and (A) in the case of a Standby Letter of Credit, one year after the date of
issuance thereof and (B) in the case of a Trade Letter of Credit, 120 days after
the date of issuance thereof. Within the limits of the Letter of Credit
Facility, and subject to the limits referred to above, the Borrower may request
the issuance of Letters of Credit under this Section 2.01(d), repay any Letter
of Credit Advances resulting from drawings
27
thereunder pursuant to Section 2.04(d) and request the issuance of additional
Letters of Credit under this Section 2.01(d).
SECTION 2.02. MAKING THE ADVANCES. (a) Except as otherwise
provided in Section 2.02(b) or Section 2.03, each Borrowing shall be made on
notice, given not later than 12:00 P.M. (New York City time) on the third
Business Day prior to the date of the proposed Borrowing in the case of a
Borrowing consisting of Eurodollar Rate Advances, or the first Business Day
prior to the date of the proposed Borrowing in the case of a Borrowing
consisting of Base Rate Advances, by the Borrower to the Administrative Agent,
which shall give to each Appropriate Lender prompt notice thereof by telex or
telecopier. Each such notice of a Borrowing (a "NOTICE OF BORROWING") shall be
in writing, or telex or telecopier, in substantially the form of Exhibit B
hereto, specifying therein the requested (i) date of such Borrowing, (ii)
Facility under which such Borrowing is to be made, (iii) Type of Advances
comprising such Borrowing, (iv) aggregate amount of such Borrowing and (v) in
the case of a Borrowing consisting of Eurodollar Rate Advances, initial Interest
Period for each such Advance. Each Appropriate Lender shall, before 12:00 P.M.
(New York City time) on the date of such Borrowing, make available for the
account of its Applicable Lending Office to the Administrative Agent at the
Administrative Agent's Account, in same day funds, such Lender's ratable portion
of such Borrowing in accordance with the respective Commitments under the
applicable Facility of such Lender and the other Appropriate Lenders. After the
Administrative Agent's receipt of such funds and upon fulfillment of the
applicable conditions set forth in Article III, the Administrative Agent will
make such funds available to the Borrower by crediting the Borrower's Account;
provided, however, that, in the case of any Working Capital Borrowing, the
Administrative Agent shall first make a portion of such funds equal to the
aggregate principal amount of any Swing Line Advances and Letter of Credit
Advances made by the Swing Line Bank or the Issuing Bank, as the case may be,
and by any other Working Capital Lender and outstanding on the date of such
Working Capital Borrowing, plus interest accrued and unpaid thereon to and as of
such date, available to the Swing Line Bank and the Issuing Bank and such other
Working Capital Lenders for repayment of such Swing Line Advances and Letter of
Credit Advances.
(b) Each Swing Line Borrowing shall be made on notice, given
not later than 12:00 P.M. (New York City time) on the date of the proposed Swing
Line Borrowing, by the Borrower to the Swing Line Bank and the Administrative
Agent. Each such notice of a Swing Line Borrowing (a "NOTICE OF SWING LINE
BORROWING"), shall be in writing, by telex or telecopier, in substantially the
form of Exhibit B hereto, specifying therein the requested (i) date of such
Borrowing (which shall be a Business Day), (ii) amount of such Borrowing and
(iii) maturity of such Borrowing (which maturity shall be no later than the
seventh day after the requested date of such Borrowing). The Swing Line Bank
will make the amount thereof available to the Administrative Agent at the
Administrative Agent's Account, in same day funds. After the Administrative
Agent's receipt of such funds and upon fulfillment of the applicable conditions
set forth in Article III, the Administrative Agent will make such funds
available to the Borrower by crediting the Borrower's Account. Upon written
demand by the Swing Line Bank with a copy of such demand to the Administrative
Agent, each other Working Capital Lender shall purchase from the Swing Line
Bank, and the Swing Line Bank shall sell and assign to each such other Working
Capital Lender, such other Lender's Pro Rata Share of such outstanding Swing
Line Advance as of the date of such demand, by making available for the account
of its Applicable Lending Office to the Administrative Agent for the account of
the Swing Line Bank, by deposit to the Administrative Agent's Account, in same
day funds, an amount equal to the portion of the outstanding principal amount of
such Swing Line Advance to be purchased by such Lender. The Borrower hereby
agrees to each such sale and assignment. Each Working Capital Lender agrees to
purchase its Pro Rata Share of an outstanding Swing Line Advance on (i) the
Business Day on which demand therefor is made by the Swing Line Bank, provided
that notice of such demand is given not later than 12:00 P.M. (New York City
time) on such Business Day or (ii) the first Business Day next succeeding such
demand if notice of such demand is given after such time. Upon any such
assignment by the Swing Line Bank to any other Working Capital Lender of a
portion of a Swing Line Advance, the Swing Line Bank represents and warrants to
such other Lender that the Swing Line Bank is the legal and beneficial owner of
such interest being assigned by it, but makes no other representation or
warranty and assumes no responsibility with respect to such Swing
28
Line Advance, the Loan Documents or any Loan Party. If and to the extent that
any Working Capital Lender shall not have so made the amount of such Swing Line
Advance available to the Administrative Agent, such Working Capital Lender
agrees to pay to the Administrative Agent forthwith on demand such amount
together with interest thereon, for each day from the date of demand by the
Swing Line Bank until the date such amount is paid to the Administrative Agent,
at the Federal Funds Rate. If such Lender shall pay to the Administrative Agent
such amount for the account of the Swing Line Bank on any Business Day, such
amount so paid in respect of principal shall constitute a Swing Line Advance
made by such Lender on such Business Day for purposes of this Agreement, and the
outstanding principal amount of the Swing Line Advance made by the Swing Line
Bank shall be reduced by such amount on such Business Day.
(c) Anything in subsection (a) above to the contrary
notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for
the initial Borrowing hereunder and for the period from the date of such initial
Borrowing to the earlier of (x) three months from such date and (y) the
completion of syndication of the Facilities (as shall be specified by the
Administrative Agent in a written notice to the Borrower) or for any Borrowing
if the aggregate amount of such Borrowing is less than $1,000,000 or if the
obligation of the Appropriate Lenders to make Eurodollar Rate Advances shall
then be suspended pursuant to Section 2.09 or 2.10 and (ii) with respect to
Borrowings consisting of Eurodollar Rate Advances, the Term A Advances and the
Working Capital Advances may not be outstanding as part of more than nine
separate Borrowings in the aggregate.
(d) Each Notice of Borrowing and Notice of Swing Line
Borrowing shall be irrevocable and binding on the Borrower. In the case of any
Borrowing that the related Notice of Borrowing specifies is to be comprised of
Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate Lender
against any loss, cost or expense incurred by such Lender as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
for such Borrowing the applicable conditions set forth in Article III,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.
(e) Unless the Administrative Agent shall have received notice
from an Appropriate Lender prior to the date of any Borrowing under a Facility
under which such Lender has a Commitment that such Lender will not make
available to the Administrative Agent such Lender's ratable portion of such
Borrowing, the Administrative Agent may assume that such Lender has made such
portion available to the Administrative Agent on the date of such Borrowing in
accordance with subsection (a) or (b) of this Section 2.02 and the
Administrative Agent may, in reliance upon such assumption, make available to
the Borrower on such date a corresponding amount. If and to the extent that such
Lender shall not have so made such ratable portion available to the
Administrative Agent, such Lender and the Borrower severally agree to repay or
pay to the Administrative Agent forthwith on demand such corresponding amount
and to pay interest thereon, for each day from the date such amount is made
available to the Borrower until the date such amount is repaid or paid to the
Administrative Agent, at (i) in the case of the Borrower, the interest rate
applicable at such time under Section 2.07 to Advances comprising such Borrowing
and (ii) in the case of such Lender, the Federal Funds Rate. If such Lender
shall pay to the Administrative Agent such corresponding amount, such amount so
paid in respect of principal shall constitute such Lender's Advance as part of
such Borrowing for all purposes.
(f) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
SECTION 2.03. ISSUANCE OF AND DRAWINGS AND REIMBURSEMENT UNDER
LETTERS OF CREDIT. (a) REQUEST FOR ISSUANCE. Each Letter of Credit shall be
issued upon notice, given not later than 12:00 P.M. (New York City time) on the
second Business Day prior to the date of the proposed
29
issuance of such Letter of Credit, by the Borrower to the Issuing Bank, which
shall give to the Administrative Agent prompt notice thereof by telex or
telecopier. Each such notice of issuance of a Letter of Credit (a "NOTICE OF
ISSUANCE") shall be by telex or telecopier, specifying therein the requested (A)
date of such issuance (which shall be a Business Day), (B) Available Amount of
such Letter of Credit, (C) expiration date of such Letter of Credit, (D) name
and address of the beneficiary of such Letter of Credit and (E) form of such
Letter of Credit, and shall be accompanied by such application and agreement for
letter of credit as the Issuing Bank may reasonably specify to the Borrower for
use in connection with such requested Letter of Credit (a "LETTER OF CREDIT
AGREEMENT"). If the requested form of such Letter of Credit is acceptable to the
Issuing Bank in its sole discretion, the Issuing Bank will, upon fulfillment of
the applicable conditions set forth in Article III, make such Letter of Credit
available to the Borrower at its office referred to in Section 8.02 or as
otherwise agreed with the Borrower in connection with such issuance. In the
event and to the extent that the provisions of any Letter of Credit Agreement
shall conflict with this Agreement, the provisions of this Agreement shall
govern.
(b) LETTER OF CREDIT REPORTS. The Issuing Bank shall furnish
(A) to the Administrative Agent with a copy to the Borrower on the first
Business Day of each week a written report summarizing issuance and expiration
dates of Letters of Credit issued during the previous week and drawings during
such week under all Letters of Credit, (B) to each Working Capital Lender on the
first Business Day of each calendar quarter a written report summarizing
issuance and expiration dates of Letters of Credit issued during the preceding
quarter and drawings during such calendar quarter under all Letters of Credit
and (C) to the Administrative Agent and each Working Capital Lender on the first
Business Day of each calendar quarter a written report setting forth the average
daily aggregate Available Amount during the preceding calendar quarter of all
Letters of Credit.
(c) DRAWING AND REIMBURSEMENT. The payment by the Issuing Bank
of a draft drawn under any Letter of Credit shall constitute for all purposes of
this Agreement the making by the Issuing Bank of a Letter of Credit Advance,
which shall be a Base Rate Advance, in the amount of such draft. In the event of
any drawing under a Letter of Credit, the Issuing Bank shall promptly notify the
Administrative Agent, and the Administrative Agent shall promptly notify each
Working Capital Lender and each Working Capital Lender shall purchase from the
Issuing Bank, and the Issuing Bank shall sell and assign to each such Working
Capital Lender, such Lender's Pro Rata Share of such outstanding Letter of
Credit Advance as of the date of such purchase, by making available for the
account of its Applicable Lending Office to the Administrative Agent for the
account of the Issuing Bank, by deposit to the Administrative Agent's Account,
in same day funds, an amount equal to the portion of the outstanding principal
amount of such Letter of Credit Advance to be purchased by such Lender. Promptly
after receipt thereof, the Administrative Agent shall transfer such funds to the
Issuing Bank. The Borrower hereby agrees to each such sale and assignment. Each
Working Capital Lender agrees to purchase its Pro Rata Share of an outstanding
Letter of Credit Advance on (i) the Business Day on which notice of the drawing
under the related Letter of Credit is given by the Issuing Bank, provided such
notice is given not later than 1:00 P.M. (New York City time) on such Business
Day or (ii) the first Business Day next succeeding such demand if such notice is
given after such time. Upon any such assignment by the Issuing Bank to any other
Working Capital Lender of a portion of a Letter of Credit Advance, the Issuing
Bank represents and warrants to such other Lender that the Issuing Bank is the
legal and beneficial owner of such interest being assigned by it, free and clear
of any liens, but makes no other representation or warranty and assumes no
responsibility with respect to such Letter of Credit Advance, the Loan Documents
or any Loan Party. If and to the extent that any Working Capital Lender shall
not have so made the amount of such Letter of Credit Advance available to the
Administrative Agent, such Working Capital Lender agrees to pay to the
Administrative Agent forthwith on demand such amount together with interest
thereon, for each day from the date of demand by the Issuing Bank until the date
such amount is paid to the Administrative Agent, at the Federal Funds Rate for
its account or the account of the Issuing Bank, as applicable. If such Lender
shall pay to the Administrative Agent such amount for the account of the Issuing
Bank on any Business Day, such amount so paid in respect of principal shall
constitute a Letter of Credit Advance made by such Lender on such Business Day
for purposes of this
30
Agreement, and the outstanding principal amount of the Letter of Credit Advance
made by the Issuing Bank shall be reduced by such amount on such Business Day.
(d) FAILURE TO MAKE LETTER OF CREDIT ADVANCES. The failure of
any Lender to make the Letter of Credit Advance to be made by it on the date
specified in Section 2.03(c) shall not relieve any other Lender of its
obligation hereunder to make its Letter of Credit Advance on such date, but no
Lender shall be responsible for the failure of any other Lender to make the
Letter of Credit Advance to be made by such other Lender on such date.
SECTION 2.04. REPAYMENT OF ADVANCES. (a) TERM ADVANCES. The
Borrower shall repay to the Administrative Agent for the ratable account of the
Term A Lenders the aggregate outstanding principal amount of the Term A
Advances, respectively, on the following dates in the amounts indicated (which
amounts shall be reduced as a result of the application of prepayments in
accordance with the order of priority set forth in Section 2.06):
AMOUNT
DATE TERM A FACILITY
---- ---------------
March 31, 2000 $729,166.67
June 30, 2000 $729,166.67
September 30, 2000 $729,166.67
December 31, 2000 $729,166.67
March 31, 2001 $1,166,666.67
June 30, 2001 $1,166,666.67
September 30, 2001 $1,166,666.67
December 31, 2001 $1,166,666.67
March 31, 2002 $1,458,333.33
June 30, 2002 $1,458,333.33
September 30, 2002 $1,458,333.33
December 31, 2002 $1,458,333.33
March 31, 2003 $1,604,166.67
June 30, 2003 $1,604,166.67
September 30, 2003 $1,604,166.67
December 31, 2003 $1,604,166.67
March 31, 2004 $1,750,000.00
June 30, 2004 $1,750,000.00
September 30, 2004 $1,750,000.00
December 31, 2004 $1,750,000.00
March 31, 2005 $2,722,222.22
June 30, 2005 $2,722,222.22
September 30, 2005 $2,722,222.22
provided, however, that the final principal installment of the Term A Facility
shall in any event and in each case be in an amount equal to the aggregate
principal amount of the Term A Advances then outstanding.
(b) WORKING CAPITAL ADVANCES. The Borrower shall repay to the
Administrative Agent for the ratable account of the Working Capital Lenders on
the Termination Date the aggregate outstanding principal amount of the Working
Capital Advances then outstanding.
(c) SWING LINE ADVANCES. The Borrower shall repay to the
Administrative Agent for the account of the Swing Line Bank and each other
Working Capital Lender that has made a Swing Line Advance the outstanding
principal amount of each Swing Line Advance made by each of them on the earlier
of the maturity date specified in the applicable Notice of Swing Line Borrowing
(which maturity shall be no later than the seventh day after the requested date
of such Borrowing) and the Termination Date.
31
(d) LETTER OF CREDIT ADVANCES. (i) The Borrower shall repay to
the Administrative Agent for the account of the Issuing Bank and each other
Working Capital Lender that has made a Letter of Credit Advance on the earlier
of demand by the Administrative Agent and the Termination Date the outstanding
principal amount of each Letter of Credit Advance made by each of them.
(ii) The Obligations of the Borrower under this Agreement, any
Letter of Credit Agreement and any other agreement or instrument relating to any
Letter of Credit shall be unconditional and irrevocable, and shall be paid
strictly in accordance with the terms of this Agreement, such Letter of Credit
Agreement and such other agreement or instrument under all circumstances,
including, without limitation, the following circumstances:
(A) any lack of validity or enforceability of any Loan
Document, any Letter of Credit Agreement, any Letter of Credit or any
other agreement or instrument relating thereto (all of the foregoing
being, collectively, the "L/C RELATED DOCUMENTS");
(B) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver of
or any consent to departure from all or any of the L/C Related
Documents;
(C) the existence of any claim, set-off, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Persons for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank or
any other Person, whether in connection with the transactions
contemplated by the L/C Related Documents or any unrelated transaction;
(D) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(E) payment by the Issuing Bank under a Letter of Credit
against presentation of a draft or certificate that does not strictly
comply with the terms of such Letter of Credit;
(F) any exchange, release or non-perfection of any Collateral
or other collateral, or any release or amendment or waiver of or
consent to departure from the Guaranties or any other guarantee, for
all or any of the Obligations of the Borrower in respect of the L/C
Related Documents; or
(G) any other circumstance or happening whatsoever, whether or
not similar to any of the foregoing, including, without limitation, any
other circumstance that might otherwise constitute a defense available
to, or a discharge of, the Borrower or a guarantor.
SECTION 2.05. TERMINATION OR REDUCTION OF THE COMMITMENTS. (a)
OPTIONAL. The Borrower may, upon at least two Business Days' notice to the
Administrative Agent, terminate in whole or reduce in part the unused portions
of the Term A Commitments, the Swing Line Commitment and the Letter of Credit
Facility and the Unused Working Capital Commitments; provided, however, that
each partial reduction of a Facility (i) shall be in an aggregate amount of
$1,000,000 or an integral multiple of $1,000,000 in excess thereof, and (ii)
shall be made ratably among the Appropriate Lenders in accordance with their
Commitments with respect to such Facility.
(b) MANDATORY. (i) On the date of the Term A Borrowing, after
giving effect to such Term A Borrowing, and from time to time thereafter upon
each repayment or prepayment of the Term A Advances, the aggregate Term A
Commitments of the Term A Lenders shall be automatically and permanently
reduced, on a pro rata basis, by an amount equal to the amount by
32
which the aggregate Term A Commitments immediately prior to such reduction
exceed the aggregate unpaid principal amount of the Term A Advances then
outstanding.
(ii) The Working Capital Facility shall be automatically and
permanently reduced on each date on which prepayment thereof is required to be
made pursuant to Section 2.06(b)(i) or (ii) in an amount equal to the applicable
Reduction Amount, provided that each such reduction of the Working Capital
Facility shall be made ratably among the Working Capital Lenders in accordance
with their Working Capital Commitments.
(iii) The Swing Line Facility and the Letter of Credit
Facility shall each be automatically and permanently reduced from time to time
on the date of each reduction in the Working Capital Facility by the amount, if
any, by which each such Facility exceeds the Working Capital Facility after
giving effect to such reduction of the Working Capital Facility.
SECTION 2.06. PREPAYMENTS. (a) OPTIONAL. The Borrower may,
upon at least one Business Day's notice in the case of Base Rate Advances and
three Business Days' notice in the case of Eurodollar Rate Advances, in each
case to the Administrative Agent (received not later than 12:00 P.M. (New York
City time) stating the proposed date and aggregate principal amount of the
prepayment, and if such notice is given the Borrower shall, prepay the
outstanding aggregate principal amount of the Advances comprising part of the
same Borrowing in whole or ratably in part, together with accrued interest to
the date of such prepayment on the aggregate principal amount prepaid unless
such prepayment is with respect to a Swing Line Advance or a Working Capital
Advance which is a Base Rate Advance; provided, however, that (x) each partial
prepayment (other than prepayments of Swing Line Advances) shall be in an
aggregate principal amount of $500,000 or an integral multiple of $100,000 in
excess thereof and (y) if any prepayment of a Eurodollar Rate Advance shall be
made other than on the last day of an Interest Period therefor, the Borrower
shall also pay any amounts owing pursuant to Section 8.04(c). Each such
prepayment which is made with respect to any Term Advances shall be applied
ratably to the Term Facilities and ratably to the remaining principal
installments thereof.
(b) MANDATORY. (i) Commencing the Fiscal Year ending December
31, 2000, the Borrower shall, no later than the 15th day following the date on
which it delivers the financial statements referred to in Section 5.03(d) (but
in any event within 105 days after the end of each Fiscal Year), prepay an
aggregate principal amount of the Advances comprising part of the same
Borrowings equal to 50% of the amount of Excess Cash Flow for such Fiscal Year.
Each such prepayment of any Advances shall be applied as follows:
FIRST, ratably to the Term Facilities and ratably to the
remaining principal installments thereof, and
SECOND, to the extent that no Term Advances remain
outstanding, permanently to reduce the Working Capital Facility as set forth in
clause (v) below.
(ii) The Borrower shall, on the date of receipt of the Net
Cash Proceeds by it or any of its Subsidiaries from (A) the sale, lease,
transfer or other disposition of any assets by it or any of its Subsidiaries
(other than any (1) sale, lease, transfer or other disposition of assets
pursuant to Section 5.02(e), or (2) sublease of any asset by it or any of its
Subsidiaries), (B) the incurrence or issuance by it or any of its Subsidiaries
of any Debt (other than Debt incurred or issued pursuant to Section 5.02(b)),
(C) the sale or issuance by it or any of its Subsidiaries of any capital stock
or other ownership or profit interest (including, without limitation, any
capital contribution), any securities convertible into or exchangeable for
capital stock or other ownership or profit interest or any warrants, rights or
options to acquire capital stock or other ownership or profit interest, (D) any
Extraordinary Receipt received by or paid to or for the account of it or any of
its Subsidiaries and not otherwise included in clause (A), (B) or (C) above,
prepay an aggregate principal amount of the Advances comprising part of the same
Borrowings equal to the amount of such Net Cash Proceeds. Each such prepayment
of any Advances shall be applied as follows:
33
first, ratably to the Term Facilities and ratably to the
remaining principal installments thereof, and
second, to the extent that no Term Advances remain
outstanding, permanently to reduce the Working Capital Facility as set
forth in clause (v) below.
(iii) The Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Working Capital Advances comprising part of
the same Borrowings, the Swing Line Advances and the Letter of Credit Advances
equal to the amount by which (A) the sum of the aggregate principal amount of
(x) the Working Capital Advances, (y) the Swing Line Advances and (z) the Letter
of Credit Advances then outstanding plus the aggregate Available Amount of all
Letters of Credit then outstanding exceeds (B) the lesser of the Working Capital
Facility and the Loan Value of Eligible Collateral on such Business Day (as
determined based on the most recent Borrowing Base Certificate delivered to the
Lender Parties hereunder).
(iv) The Borrower shall, on each Business Day, pay to the
Administrative Agent for deposit in the L/C Cash Collateral Account an amount
sufficient to cause the aggregate amount on deposit in such Account to equal the
amount by which the aggregate Available Amount of all Letters of Credit then
outstanding exceeds the Letter of Credit Facility on such Business Day.
(v) Prepayments of the Working Capital Facility made pursuant
to clause (i), (ii) and (iii) above shall be applied first ratably to prepay
Swing Line Advances and Letter of Credit Advances then outstanding until such
Advances are paid in full, and second to prepay Working Capital Advances then
outstanding comprising part of the same Borrowings until such Advances are paid
in full and third deposited in the L/C Cash Collateral Account to cash
collateralize 100% of the Available Amount of the Letters of Credit then
outstanding; and, in the case of prepayments of the Working Capital Facility
required pursuant to clause (i) or (ii) above, the amount remaining (if any)
after the prepayment in full of the Working Capital Advances then outstanding
and the cash collateralization of the aggregate Available Amount of Letters of
Credit then outstanding (the sum of such prepayment amounts, cash
collateralization amounts and remaining amount being referred to herein as the
"REDUCTION AMOUNT") may be retained by the Borrower and the Working Capital
Facility shall be permanently reduced as set forth in Section 2.05(b)(ii). Upon
the drawing of any Letter of Credit for which funds are on deposit in the L/C
Cash Collateral Account, such funds shall be applied to reimburse the Issuing
Bank or Working Capital Lenders, as applicable.
(vi) Notwithstanding anything to the contrary contained in
this Section 2.06(b), so long as no Default shall have occurred and be
continuing, if, on any date on which a prepayment of Advances would otherwise be
required pursuant to clauses (i), (ii) or (iii) of this Section 2.06(b) on any
day other than on the last day of the Interest Period therefor, the Borrower may
in its sole discretion (but shall not be required to), deposit the amount of any
such prepayment otherwise required to be made hereunder in a cash collateral
account (the "CASH COLLATERAL ACCOUNT") of the Borrower maintained with the
Administrative Agent, until the last day of such Interest Period, at which time
the Administrative Agent shall be authorized (without any further action by the
Borrower) to apply such prepayment as set forth in such relevant clauses (i),
(ii) or (iii) of this Section 2.06(b).
(vii) All prepayments under this subsection (b) shall be made
together with accrued interest to the date of such prepayment on the principal
amount prepaid, together with any amounts owing pursuant to Section 8.04(c).
(viii) All prepayments of any Facility required by this
Section 2.06 shall be applied first to Base Rate Advances.
SECTION 2.07. INTEREST. (a) SCHEDULED INTEREST. The Borrower
shall pay interest on the unpaid principal amount of each Advance owing to each
Lender from the date of such Advance until such principal amount shall be paid
in full, at the following rates per annum:
34
(i) BASE RATE ADVANCES. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of
(A) the Base Rate in effect from time to time plus (B) the Applicable
Margin in effect from time to time, payable in arrears quarterly on
March 31, June 30, September 30 and December 31 during such periods, on
the date of any prepayment thereof to the extent required under Section
2.06 and on the Termination Date, commencing December 31, 1999.
(ii) EURODOLLAR RATE ADVANCES. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of (A)
the Eurodollar Rate for such Interest Period for such Advance plus (B)
the Applicable Margin, payable in arrears on the last day of such
Interest Period and, if such Interest Period has a duration of more
than three months, on each day that occurs during such Interest Period
every three months from the first day of such Interest Period and on
the date such Eurodollar Rate Advance shall be Converted or paid in
full.
(b) DEFAULT INTEREST. Upon the occurrence and during the
continuance of any Event of Default the Administrative Agent, upon the request
of the Required Lenders, shall require that the Borrower pay interest on (i) the
unpaid principal amount of each Advance owing to each Lender, payable in arrears
on the dates referred to in clause (a)(i) or (a)(ii) above and on demand, at a
rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid on such Advance pursuant to clause (a)(i) or (a)(ii) above
and (ii) to the fullest extent permitted by law, the amount of any interest, fee
or other amount payable under the Loan Documents that is not paid when due, from
the date such amount shall be due until such amount shall be paid in full,
payable in arrears on the date such amount shall be paid in full and on demand,
at a rate per annum equal at all times to 2% per annum above the rate per annum
required to be paid, in the case of interest, on the Type of Advance on which
such interest has accrued pursuant to clause (a)(i) or (a)(ii) above and, in all
other cases, on Base Rate Advances pursuant to clause (a)(i) above; provided,
however, that following acceleration of the Advances pursuant to Section 6.01,
interest shall accrue and be payable at the rate required by this Section
2.07(b), whether or not requested by the Administrative Agent or the Required
Lenders. In addition, following a final judgment with respect to any Obligation
of the Loan Parties under the Loan Documents, interest shall accrue at the
higher of the statutory judgment rate or the rate specified in the preceding
sentence, payable on demand.
SECTION 2.08. FEES. (a) COMMITMENT FEE. The Borrower shall pay
to the Administrative Agent for the account of the Lenders a commitment fee,
from the date hereof in the case of each Initial Lender and from the effective
date specified in the Assignment and Acceptance pursuant to which it became a
Lender in the case of each other Lender until the Termination Date, payable in
arrears quarterly on March 31, June 30, September 30 and December 31, commencing
December 31, 1999, and on the Termination Date, at the rate of 1/2 of 1% per
annum on the average daily unused portion of each Appropriate Lender's Term
Commitment and on the average daily Unused Working Capital Commitment of such
Lender.
(b) LETTER OF CREDIT FEES, ETC. (i) The Borrower shall pay to
the Administrative Agent for the account of each Working Capital Lender a
commission, payable in arrears quarterly on March 31, June 30, September 30 and
December 31, commencing December 31, 1999, and on the Termination Date, on such
Lender's Pro Rata Share of the average daily aggregate Available Amount during
such quarter of all Letters of Credit outstanding from time to time at the
Applicable Margin for Eurodollar Rate Advances under the Working Capital
Facility.
(ii) The Borrower shall pay to the Issuing Bank, for its own
account, such commissions, issuance fees, fronting fees, transfer fees and other
fees and charges in connection with the issuance or administration of each
Letter of Credit as the Borrower and the Issuing Bank shall agree.
35
(c) AGENTS' FEES. The Borrower shall pay to each Agent for its
own account such fees as may from time to time be agreed between the Borrower
and such Agent.
SECTION 2.09. CONVERSION OF ADVANCES. (a) OPTIONAL. The
Borrower may on any Business Day, upon notice given to the Administrative Agent
not later than 12:00 P.M. (New York City time) on the third Business Day prior
to the date of the proposed Conversion and subject to the provisions of Section
2.10, Convert all or any portion of the Advances of one Type comprising the same
Borrowing into Advances of the other Type; provided, however, that (A) if any
Conversion of Eurodollar Rate Advances into Base Rate Advances is made other
than on the last day of an Interest Period for such Eurodollar Rate Advances the
Borrower shall also pay any amounts owing pursuant to Section 8.04(c), (x) any
Conversion of Base Rate Advances into Eurodollar Rate Advances shall be in an
amount not less than the minimum amount specified in Section 2.02(b), (y) no
Conversion of any Advances shall result in more separate Borrowings than
permitted under Section 2.02(b) and (z) each Conversion of Advances comprising
part of the same Borrowing under any Facility shall be made ratably among the
Appropriate Lenders in accordance with their Commitments under such Facility,
and (B) all of the Advances shall automatically be Converted to Base Rate
Advances on the Conversion date if no such notice is received by the
Administrative Agent by the third day prior to the date of the proposed
Conversion. Each such notice of Conversion shall, within the restrictions
specified above, specify (i) the date of such Conversion, (ii) the Advances to
be Converted and (iii) if such Conversion is into Eurodollar Rate Advances, the
duration of the initial Interest Period for such Advances. Each notice of
Conversion shall be irrevocable and binding on the Borrower.
(b) MANDATORY. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $1,000,000, such
Advances shall automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "Interest Period" in Section 1.01, the
Administrative Agent will forthwith so notify the Borrower and the Appropriate
Lenders, whereupon each such Eurodollar Rate Advance will automatically, on the
last day of the then existing Interest Period therefor, Convert into a Base Rate
Advance.
(iii) Upon the occurrence and during the continuance of any
Event of Default and upon notice from the Administrative Agent to the Borrower,
(x) each Eurodollar Rate Advance will automatically, on the last day of the then
existing Interest Period therefor, Convert into a Base Rate Advance and (y) the
obligation of the Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended.
SECTION 2.10. INCREASED COSTS, ETC. (a) If, due to either (i)
the introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender Party of agreeing to make
or of making, funding or maintaining Eurodollar Rate Advances or of agreeing to
issue or of issuing or maintaining or participating in Letters of Credit or of
agreeing to make or of making or maintaining Letter of Credit Advances
(excluding, for purposes of this Section 2.10, any such increased costs
resulting from (x) Taxes or Other Taxes (as to which Section 2.12 shall govern)
and (y) changes in the basis of taxation of overall net income or overall gross
income by the United States or by the foreign jurisdiction or state under the
laws of which such Lender Party is organized or has its Applicable Lending
Office or any political subdivision thereof), then the Borrower shall from time
to time, upon demand by such Lender Party, together with the provision of
reasonable detail of the underlying circumstances (with a copy of such demand
and details to the Administrative Agent), pay to the Administrative Agent for
the account of such Lender Party additional amounts sufficient to compensate
such Lender Party for such increased cost; provided, however, that a Lender
Party claiming additional amounts under this Section 2.10(a) agrees to (1) use
reasonable efforts (consistent with its internal policy and legal and regulatory
restrictions) to designate a different
36
Applicable Lending Office if the making of such a designation would avoid
the need for, or reduce the amount of, such increased cost that may
thereafter accrue and would not, in the reasonable judgment of such Lender
Party, be otherwise disadvantageous to such Lender Party and (2) make any such
determinations as to the claim for additional amounts in good faith. A
certificate as to the amount of such increased cost, submitted to the Borrower
by such Lender Party, shall be conclusive and binding for all purposes, absent
manifest error.
(b) If any Lender Party determines in good faith that
compliance with any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not having the force of
law) affects or would affect the amount of capital required or expected to be
maintained by such Lender Party or any corporation controlling such Lender Party
and that the amount of such capital is increased by or based upon the existence
of such Lender Party's commitment to lend or to issue or participate in Letters
of Credit hereunder and other commitments of such type or the issuance or
maintenance of or participation in the Letters of Credit (or similar contingent
obligations), then, upon demand by such Lender Party, together with the
provision of reasonable detail of the underlying circumstances (with a copy of
such demand and details to the Administrative Agent), the Borrower shall pay to
the Administrative Agent for the account of such Lender Party, from time to time
as specified by such Lender Party, additional amounts sufficient to compensate
such Lender Party in the light of such circumstances, to the extent that such
Lender Party reasonably determines such increase in capital to be allocable to
the existence of such Lender Party's commitment to lend or to issue or to
participate in Letters of Credit hereunder or to the issuance or maintenance of
or participation in any Letters of Credit. A certificate as to such amounts
submitted to the Borrower by such Lender Party shall be conclusive and binding
for all purposes, absent manifest error.
(c) If, with respect to any Eurodollar Rate Advances under any
Facility, Lenders owed at least 50% of the then aggregate unpaid principal
amount thereof notify the Administrative Agent in good faith that the Eurodollar
Rate for any Interest Period for such Advances will not adequately reflect the
cost to such Lenders of making, funding or maintaining their Eurodollar Rate
Advances for such Interest Period, the Administrative Agent shall forthwith so
notify the Borrower and the Appropriate Lenders and shall provide them with
reasonable details of the underlying circumstances, whereupon (i) each such
Eurodollar Rate Advance under any such Facility will automatically, on the last
day of the then existing Interest Period therefor, Convert into a Base Rate
Advance and (ii) the obligation of the Appropriate Lenders to make, or to
Convert Advances into, Eurodollar Rate Advances shall be suspended until the
Administrative Agent shall notify the Borrower that such Lenders have determined
that the circumstances causing such suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Administrative Agent, together with the provision of reasonable
detail of the underlying circumstances (i) each Eurodollar Rate Advance under
each Facility under which such Lender has a Commitment will automatically, upon
such demand, Convert into a Base Rate Advance and (ii) the obligation of the
Appropriate Lenders to make, or to Convert Advances into, Eurodollar Rate
Advances shall be suspended until the Administrative Agent shall notify the
Borrower that such Lender has determined that the circumstances causing such
suspension no longer exist; provided, however, that, before making any such
demand, such Lender agrees to use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate a different
Eurodollar Lending Office if the making of such a designation would allow such
Lender or its Eurodollar Lending Office to continue to perform its obligations
to make Eurodollar Rate Advances or to continue to fund or maintain Eurodollar
Rate Advances and would not, in the judgment of such Lender, be otherwise
disadvantageous to such Lender.
37
SECTION 2.11. PAYMENTS AND COMPUTATIONS. (a) The Borrower
shall make each payment hereunder irrespective of any right of counterclaim or
set-off, not later than 12:00 P.M. (New York City time) on the day when due in
U.S. dollars to the Administrative Agent at the Administrative Agent's Account
in same day funds, with payments being received by the Administrative Agent
after such time being deemed to have been received on the next succeeding
Business Day. The Administrative Agent will promptly thereafter cause like funds
to be distributed (i) if such payment by the Borrower is in respect of
principal, interest, commitment fees or any other Obligation then payable
hereunder to more than one Lender Party, to such Lender Parties for the account
of their respective Applicable Lending Offices ratably in accordance with the
amounts of such respective Obligations then payable to such Lender Parties and
(ii) if such payment by the Borrower is in respect of any Obligation then
payable hereunder to one Lender Party, to such Lender Party for the account of
its Applicable Lending Office, in each case to be applied in accordance with the
terms of this Agreement. Upon its acceptance of an Assignment and Acceptance and
recording of the information contained therein in the Register pursuant to
Section 8.07(d), from and after the effective date of such Assignment and
Acceptance, the Administrative Agent shall make all payments hereunder in
respect of the interest assigned thereby to the Lender Party assignee
thereunder, and the parties to such Assignment and Acceptance shall make all
appropriate adjustments in such payments for periods prior to such effective
date directly between themselves.
(b) If the Administrative Agent receives funds for application
to the Obligations under the Loan Documents under circumstances for which the
Loan Documents do not specify the Advances or the Facility to which, or the
manner in which, such funds are to be applied, the Administrative Agent may, but
shall not be obligated to, elect to distribute such funds to each Lender Party
ratably in accordance with such Lender Party's proportionate share of the
principal amount of all outstanding Advances and the Available Amount of all
Letters of Credit then outstanding, in repayment or prepayment of such of the
outstanding Advances or other Obligations owed to such Lender Party, and for
application to such principal installments, as the Administrative Agent shall
direct.
(c) The Borrower hereby authorizes each Lender Party and each
of its Affiliates, if and to the extent payment owed to such Lender Party is not
made when due hereunder to charge from time to time, to the fullest extent
permitted by law, against any or all of the Borrower's accounts with such Lender
Party or such Affiliate any amount so due.
(d) All computations of interest, fees and Letter of Credit
commissions shall be made by the Administrative Agent on the basis of a year of
360 days, in each case for the actual number of days (including the first day
but excluding the last day) occurring in the period for which such interest,
fees or commissions are payable. Each determination by the Administrative Agent
of an interest rate, fee or commission hereunder shall be conclusive and binding
for all purposes, absent manifest error.
(e) Whenever any payment hereunder shall be stated to be due
on a day other than a Business Day, such payment shall be made on the next
succeeding Business Day, and such extension of time shall in such case be
included in the computation of payment of interest or commitment fee, as the
case may be; provided, however, that, if such extension would cause any payment
to be made in the next following calendar month, such payment shall be made on
the next preceding Business Day and such adjustment of time shall in such case
be reflected in the computation of payment of interest or commitment fee, as the
case may be.
(f) Unless the Administrative Agent shall have received notice
from the Borrower prior to the date on which any payment is due to any Lender
Party hereunder that the Borrower will not make such payment in full, the
Administrative Agent may assume that the Borrower has made such payment in full
to the Administrative Agent on such date and the Administrative Agent may, in
reliance upon such assumption, cause to be distributed to each such Lender Party
on such due date an amount equal to the amount then due such Lender Party. If
and to the extent the Borrower shall not have so made such payment in full to
the Administrative Agent,
38
each such Lender Party shall repay to the Administrative Agent forthwith
on demand such amount distributed to such Lender Party together with
interest thereon, for each day from the date such amount is distributed to such
Lender Party until the date such Lender Party repays such amount to the
Administrative Agent, at the Federal Funds Rate.
SECTION 2.12. TAXES. (a) Any and all payments by the Borrower
hereunder or under the Notes shall be made, in accordance with Section 2.11,
free and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of each Lender Party and the
Administrative Agent, taxes that are imposed on its overall net income by the
United States and taxes that are imposed on its overall net income (and
franchise taxes imposed in lieu thereof) by the state or foreign jurisdiction
under the laws of which such Lender Party or the Administrative Agent (as the
case may be) is organized or any political subdivision thereof and, in the case
of each Lender Party, taxes that are imposed on its overall net income (and
franchise taxes in lieu thereof) by the state or foreign jurisdiction of such
Lender Party's Applicable Lending Office or any political subdivision thereof
(all such non-excluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities in respect of payments hereunder or under the Notes being
hereinafter referred to as "TAXES"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder to any Lender
Party or the Administrative Agent, (i) the sum payable by the Borrower shall be
increased as may be necessary so that after the Borrower and the Administrative
Agent have made all required deductions (including deductions applicable to
additional sums payable under this Section 2.12) such Lender Party or the
Administrative Agent, as the case may be, receives an amount equal to the sum it
would have received had no such deductions been made, (ii) the Borrower shall
make all such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other governmental authority in
accordance with applicable law.
(b) In addition, the Borrower shall pay any present or future
stamp, documentary, excise, property or similar taxes, charges or levies that
arise from any payment made hereunder or under the Notes or from the execution,
delivery or registration of, performance under, or otherwise with respect to
this Agreement or the Notes (hereinafter referred to as "OTHER TAXES").
(c) The Borrower shall indemnify each Lender Party and the
Administrative Agent for and hold it harmless against the full amount of Taxes
and Other Taxes, and for the full amount of taxes of any kind imposed by any
jurisdiction on amounts payable under this Section 2.12, imposed on or paid by
such Lender Party or the Administrative Agent (as the case may be) and any
liability (including penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be made within 30
days from the date such Lender Party or the Administrative Agent (as the case
may be) makes written demand therefor.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower shall furnish to the Administrative Agent, at its address referred to
in Section 8.02, the original or a certified copy of a receipt evidencing such
payment. In the case of any payment hereunder or under the Notes by or on behalf
of the Borrower through an account or branch outside the United States or on
behalf of the Borrower by a payor that is not a United States person, if the
Borrower determines that no Taxes are payable in respect thereof, the Borrower
shall furnish, or shall cause such payor to furnish, to the Administrative
Agent, at such address, an opinion of counsel acceptable to the Administrative
Agent stating that such payment is exempt from Taxes. For purposes of
subsections (d) and (e) of this Section 2.12, the terms "UNITED States" and
"UNITED STATES PERSON" shall have the meanings specified in Section 7701 of the
Internal Revenue Code.
39
(e) Each Lender Party organized under the laws of a
jurisdiction outside the United States shall, on or prior to the date of its
execution and delivery of this Agreement in the case of each Initial Lender or
Initial Issuing Bank, as the case may be, and on the date of the Assignment and
Acceptance pursuant to which it becomes a Lender Party in the case of each other
Lender Party, and from time to time thereafter if requested in writing by the
Borrower or the Administrative Agent (but only so long thereafter as such Lender
Party remains lawfully able to do so), provide the Administrative Agent and the
Borrower with two original Internal Revenue Service forms 1001 or 4224 or (in
the case of a Lender Party that has certified in writing to the Administrative
Agent that it is not a "bank" as defined in Section 881(c)(3)(A) of the Internal
Revenue Code) form W-8 (and, if such Lender Party delivers a form W-8, a
certificate representing that such Lender Party is not a "bank" for purposes of
Section 881(c) of the Internal Revenue Code, is not a 10-percent shareholder
(within the meaning of Section 871(h)(3)(B) of the Internal Revenue Code) of the
Borrower and is not a controlled foreign corporation related to the Borrower
(within the meaning of Section 864(d)(4) of the Internal Revenue Code)), as
appropriate, or any successor or other form prescribed by the Internal Revenue
Service, certifying that such Lender Party is exempt from or entitled to a
reduced rate of United States withholding tax on payments pursuant to this
Agreement or the Notes or, in the case of a Lender Party providing a form W-8,
certifying that such Lender Party is a foreign corporation, partnership, estate
or trust. If the forms provided by a Lender Party at the time such Lender Party
first becomes a party to this Agreement indicate a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender Party provides the
appropriate forms certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such forms; provided, however, that if, at the effective date of the
Assignment and Acceptance pursuant to which a Lender Party becomes a party to
this Agreement, the Lender Party assignor was entitled to payments under
subsection (a) of this Section 2.12 in respect of United States withholding tax
with respect to interest paid at such date, then, to such extent, the term Taxes
shall include (in addition to withholding taxes that may be imposed in the
future or other amounts otherwise includable in Taxes) United States withholding
tax, if any, applicable with respect to the Lender Party assignee on such date.
If any form or document referred to in this subsection (e) requires the
disclosure of information, other than information necessary to compute the tax
payable and information required on the date hereof by Internal Revenue Service
form 1001, 4224 or W-8 (or the related certificate described above), that the
applicable Lender Party reasonably considers to be confidential, such Lender
Party shall give notice thereof to the Borrower and shall not be obligated to
include in such form or document such confidential information.
(f) For any period with respect to which a Lender Party has
failed to provide the Borrower with the appropriate form described in subsection
(e) above (other than if such failure is due to a change in law occurring after
the date on which a form originally was required to be provided or if such form
otherwise is not required under subsection (e) above), such Lender Party shall
not be entitled to indemnification under subsection (a) or (c) of this Section
2.12 with respect to Taxes imposed by the United States by reason of such
failure; provided, however, that should a Lender Party become subject to Taxes
because of its failure to deliver a form required hereunder, the Borrower shall
take such steps as such Lender Party shall reasonably request to assist such
Lender Party to recover such Taxes.
SECTION 2.13. SHARING OF PAYMENTS, ETC. If any Lender Party
shall obtain at any time any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise, other than as a result of an
assignment pursuant to Section 8.07) (a) on account of Obligations due and
payable to such Lender Party hereunder and under the Notes at such time in
excess of its ratable share (according to the proportion of (i) the amount of
such Obligations due and payable to such Lender Party at such time to (ii) the
aggregate amount of the Obligations due and payable to all Lender Parties
hereunder and under the Notes at such time) of payments on account of the
Obligations due and payable to all Lender Parties hereunder and under the Notes
at such time obtained by all the Lender Parties at such time or (b) on account
of Obligations owing (but not due and payable) to such Lender Party hereunder
and under the Notes at such time in excess of its ratable
40
share (according to the proportion of (i) the amount of such Obligations owing
to such Lender Party at such time to (ii) the aggregate amount of the
Obligations owing (but not due and payable) to all Lender Parties hereunder and
under the Notes at such time) of payments on account of the Obligations owing
(but not due and payable) to all Lender Parties hereunder and under the Notes at
such time obtained by all of the Lender Parties at such time, such Lender Party
shall forthwith purchase from the other Lender Parties such interests or
participating interests in the Obligations due and payable or owing to them, as
the case may be, as shall be necessary to cause such purchasing Lender Party to
share the excess payment ratably with each of them; provided, however, that if
all or any portion of such excess payment is thereafter recovered from such
purchasing Lender Party, such purchase from each other Lender Party shall be
rescinded and such other Lender Party shall repay to the purchasing Lender Party
the purchase price to the extent of such Lender Party's ratable share (according
to the proportion of (i) the purchase price paid to such Lender Party to (ii)
the aggregate purchase price paid to all Lender Parties) of such recovery
together with an amount equal to such Lender Party's ratable share (according to
the proportion of (i) the amount of such other Lender Party's required repayment
to (ii) the total amount so recovered from the purchasing Lender Party) of any
interest or other amount paid or payable by the purchasing Lender Party in
respect of the total amount so recovered. The Borrower agrees that any Lender
Party so purchasing an interest or participating interest from another Lender
Party pursuant to this Section 2.13 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such interest or participating interest, as the case may be, as fully as if
such Lender Party were the direct creditor of the Borrower in the amount of such
interest or participating interest, as the case may be.
SECTION 2.14. USE OF PROCEEDS. The proceeds of the Advances
and issuances of Letters of Credit shall be available (and the Borrower agrees
that it shall use such proceeds and Letters of Credit) solely to refinance
certain Existing Debt, refinance all existing redeemable preferred stock of the
Borrower, pay transaction fees and expenses, provide working capital for the
Borrower and its Material Subsidiaries (subject to the provisions of Section
5.02(f)) and for other general corporate purposes permitted hereby.
SECTION 2.15. EVIDENCE OF DEBT. (a) Each Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
indebtedness of the Borrower to such Lender resulting from each Advance owing to
such Lender from time to time, including the amounts of principal and interest
payable and paid to such Lender from time to time hereunder. The Borrower agrees
that upon notice by any Lender Party to the Borrower (with a copy of such notice
to the Administrative Agent) to the effect that a Note is required or
appropriate in order for such Lender to evidence (whether for purposes of
pledge, enforcement or otherwise) the Advances owing to, or to be made by, such
Lender Party, the Borrower shall promptly execute and deliver to such Lender a
Term A Note and a Working Capital Note, as applicable, payable to the order of
such Lender Party in a principal amount equal to the Term A Commitment or
Revolving Credit Commitment, respectively, of such Lender Party. All references
to Notes in the Loan Documents shall mean Notes, if any, to the extent issued
hereunder.
(b) The Register maintained by the Administrative Agent
pursuant to Section 8.07(d) shall include a control account, and a subsidiary
account for each Lender, in which accounts (taken together) shall be recorded
(i) the date and amount of each Borrowing made hereunder, the Type of Advances
comprising such Borrowing and, if appropriate, the Interest Period applicable
thereto, (ii) the terms of each Assignment and Acceptance delivered to and
accepted by it, (iii) the amount of any principal or interest due and payable or
to become due and payable from the Borrower to each Lender Party hereunder, and
(iv) the amount of any sum received by the Administrative Agent from the
Borrower hereunder and each Lender Party's share thereof.
(c) Entries made in good faith by the Administrative Agent in
the Register pursuant to subsection (b) above, and by each Lender Party in its
account or accounts pursuant to subsection (a) above, shall be prima facie
evidence of the amount of principal and interest due and payable or to become
due and payable from the Borrower to, in the case of the Register, each Lender
41
Party and, in the case of such account or accounts, such Lender Party, under
this Agreement, absent manifest error; provided, however, that the failure of
the Administrative Agent or such Lender Party to make an entry, or any finding
that an entry is incorrect, in the Register or such account or accounts shall
not limit or otherwise affect the obligations of the Borrower under this
Agreement.
(d) References herein to Notes shall mean and be references to
Term A Notes and the Working Capital Notes, unless otherwise specifically
indicated, in each case to the extent issued hereunder.
ARTICLE III
CONDITIONS OF LENDING AND
ISSUANCES OF LETTERS OF CREDIT
SECTION 3.01. CONDITIONS PRECEDENT TO INITIAL EXTENSION OF
CREDIT. The obligation of each Lender to make an Advance or the Issuing Bank to
issue a Letter of Credit on the occasion of the Initial Extension of Credit
hereunder is subject to the satisfaction of the following conditions precedent
before or concurrently with the Initial Extension of Credit:
(a) The Administrative Agent shall have received on or before
the day of the Initial Extension of Credit the following, each dated
such day (unless otherwise specified), in form and substance
satisfactory to the Administrative Agent (unless otherwise specified)
and (except for any Notes) in sufficient copies for each Lender Party:
(i) Notes payable to the order of the Lenders to the
extent requested by any Lender pursuant to Section 2.15.
(ii) A Notice of Borrowing and a Borrowing Base
Certificate relating to the Initial Extension of Credit.
(iii) A security agreement in
substantially the form of Exhibit D hereto
(together with each other security agreement and
security agreement supplement delivered pursuant to
Section 5.01(j), in each case as amended, amended
and restated, supplemented or otherwise modified
from time to time in accordance with its terms, the
"SECURITY AGREEMENT"), duly executed by the
Borrower, together with:
(A) certificates representing the Pledged
Shares, if any, accompanied by undated stock powers
executed in blank and instruments evidencing the
Pledged Debt, if any, indorsed in blank,
(B) executed copies of proper financing
statements under the Uniform Commercial Code of the
States of all jurisdictions that the Administrative
Agent may deem necessary or desirable in order to
perfect and protect the Liens created under the
Collateral Documents, covering the Collateral
described in the Security Agreement,
(C) Landlord consents and bailee letters
from the Persons listed on Schedule 3.01(a)(iii)(C)
in form and substance satisfactory to the
Administrative Agent,
(D) evidence of the completion of all
other recordings and filings of or with respect to
the Security Agreement that the Administrative
Agent may deem necessary or desirable in order to
perfect and protect the Liens created thereby,
42
(E) evidence of the insurance required by
the terms of the Security Agreement,
(F) copies of the Assigned Agreements, if
any, referred to in the Security Agreement,
together with a consent to such assignment, in
substantially the form of Exhibit B to the Security
Agreement, duly executed by each party to such
Assigned Agreements other than the Loan Parties,
(G) executed termination statements (Form
UCC-3 or a comparable form), in proper form to be
duly filed on the date of the Initial Extension of
Credit under the Uniform Commercial Code of all
jurisdictions that the Administrative Agent may
deem desirable in order to terminate or amend
existing Liens on the Collateral described in the
Security Agreement,
(H) the Blocked Account Letters referred
to in the Security Agreement, duly executed by each
Blocked Account Bank listed on Schedule
3.01(a)(iii)(H) in form and substance satisfactory
to the Administrative Agent, and
(I) evidence that all action not
otherwise referred to in this Section that the
Administrative Agent may deem necessary or
desirable in order to perfect and protect the liens
and security interests created under the Security
Agreement has been taken.
(iv) A termination letter from each of BT Commercial
Corporation and BNY International Limited to the
Administrative Agent relating to the satisfaction and
termination of the Existing Debt identified in paragraphs 1
and 2 on Schedule 4.01(q) and release of all collateral and
security interests relating thereto.
(v) (A) The Non-U.S. Subsidiary Guaranty duly
executed by each Material Subsidiary listed on Part A of
Schedule 3.01(a)(v), (B) the Canadian Subsidiary Guaranty duly
executed by each material Subsidiary listed on Part B of
Schedule 3.01(a)(v), (C) the Subsidiary Guaranty duly executed
by each Material Subsidiary listed on Part C of Schedule
3.01(a)(v) and (D) the Subsidiary Guaranty - Canada duly
executed by each Material Subsidiary listed on Part D of
Schedule 3.01(a)(v).
(vi) Certified copies of the resolutions of
the Board of Directors of each Loan Party approving the
Transaction and each Transaction Document to which it is or is
to be a party, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with
respect to the Transaction and each Transaction Document to
which it is or is to be a party and of the transactions
contemplated hereby.
(vii) A copy of a certificate of the Secretary
of State (or such similar document in respect of the
Foreign Subsidiaries) of the jurisdiction of incorporation of
each Loan Party, dated reasonably near the date of the Initial
Extension of Credit, in each case listing the charter of each
Loan Party and each amendment thereto on file in his office
and certifying that (A) such charter is a true and correct
copy thereof, (B) such amendments are the only amendments to
such charter on file in his office, (C) such Person has paid
all franchise taxes to the date of such certificate and (D)
such Person is duly incorporated and in good standing under
the laws of the State of the jurisdiction of its
incorporation.
43
(viii) A copy of a certificate of the Secretary of
State of the States listed on Schedule 3.01(a)(viii), dated
reasonably near the date of the Initial Extension of Credit,
with respect to each Loan Party as listed on Schedule
3.01(a)(viii), stating that such Person is duly qualified and
in good standing as a foreign corporation in such States and
has filed all annual reports required to be filed to the date
of such certificate.
(ix) A certificate of each Loan Party, signed on
behalf of each such Person by its President and its Clerk, as
to the Borrower, or other appropriate authorized officers as
to the other Loan Parties, dated the date of the Initial
Extension of Credit (the statements made in which certificate
shall be true on and as of the date of the Initial Extension
of Credit), certifying as to (A) the absence of any amendments
to the charter (or comparable documents) of such Person since
the date of the Secretary of State's certificate referred to
in Section 3.01(a)(vii), (B) a true and correct copy of the
bylaws (or comparable documents) of such Person as in effect
on the date on which the resolutions referred to in Section
3.01(a)(vi) were adopted and on the date of the Initial
Extension of Credit, (C) the due incorporation and good
standing or valid existence of such Person as a corporation
organized under the laws of the jurisdiction of its
incorporation and the absence of any proceeding for the
dissolution or liquidation of such Person, (D) the
completeness and accuracy of the representations and
warranties contained in the Loan Documents as though made on
and as of the date of the Initial Extension of Credit and (E)
the absence of any event occurring and continuing, or
resulting from the Initial Extension of Credit, that
constitutes a Default.
(x) A certificate of the Secretary of each Loan
Party certifying the names and true signatures of the officers
of such Persons authorized to sign each Transaction Document
to which it is or is to be a party and the other documents to
be delivered hereunder and thereunder.
(xi) Certified copies of each of the Related
Documents, duly executed by the parties thereto and in form
and substance satisfactory to the Lender Parties, together
with all agreements, instruments and other documents delivered
in connection therewith as the Administrative Agent shall
request.
(xii) Such financial, business and other information
regarding each Loan Party and its Subsidiaries as the Lender
Parties shall have requested, including, without limitation,
information as to possible contingent liabilities, tax
matters, environmental matters, obligations under Plans,
Multiemployer Plans and Welfare Plans, collective bargaining
agreements and other arrangements with employees, audited
annual financial statements dated January 2, 1999 prepared by
independent public accountants of recognized national
standing, interim financial statements dated on or about
August 31, 1999 and forecasts prepared by management of the
Borrower, in form and substance satisfactory to the Lender
Parties, of balance sheets, income statements and cash flow
statements on a monthly basis for the first year following the
day of the Initial Extension of Credit and on an annual basis
for each year thereafter until the Termination Date, and such
other information as the Administrative Agent may require.
(xiii) A certificate, in substantially the form of
Exhibit G hereto attesting to the Solvency of the Borrower and
its Subsidiaries taken as a whole after giving effect to the
Transaction and the other transactions contemplated hereby,
from its chief financial officer.
44
(xiv) Deeds of release or such similar documents as
may be required to release any Security Interests currently in
force in respect of the Foreign Subsidiaries. (xv) A letter,
in form and substance satisfactory to the Administrative
Agent, from the Borrower to Xxxxx Xxxxxxxx, LLP, its
independent certified public accountants, advising such
accountants that the Administrative Agent and the Lender
Parties have been authorized to exercise all rights of the
Borrower to require such accountants to disclose any and all
financial statements and any other information of any kind
that they may have with respect to the Borrower and its
Subsidiaries and directing such accountants to comply with any
reasonable request of the Administrative Agent or any Lender
Party for such information.
(xvi) Evidence of insurance naming the
Administrative Agent as additional insured and loss payee with
such responsible and reputable insurance companies or
associations, and in such amounts and covering such risks, as
is satisfactory to the Lender Parties, including, without
limitation, business interruption insurance, product liability
insurance, and directors and officers insurance.
(xvii) A favorable opinion of Xxxxxxx Procter &
Xxxx, LLP, special counsel for the Loan Parties, in
substantially the form of Exhibit H.
(xviii) A favorable opinion of XxXxxxxx Xxxxxxxx,
Canadian counsel to the Loan, in form and substance
satisfactory to the Administrative Agent.
(xix) A favorable opinion of Xxxxxxx Xxxxxxx,
English counsel to the Loan Parties, in form and substance
satisfactory to the Administrative Agent.
(xx) Intercompany Notes duly executed by each
Material Subsidiary of the Borrower (the "INTERCOMPANY
NOTES").
(xxi) The Non-U.S. Security Agreements from the
Initial Guarantors or such other Foreign Subsidiaries which
are Material Subsidiaries as the Administrative Agent shall
have requested, together with, in each case, all certificates,
notices, instruments and other documents to be delivered under
or in connection therewith.
(xxii) Certified copies of the constitutive
documents of each Initial Guarantor.
(xxiii) The Equitable Share Charge duly executed by
the Borrower.
(b) The Lender Parties shall be satisfied with (i) the
corporate and legal structure and capitalization of the Borrower and
its Subsidiaries, both before and after giving effect to the
Transaction, including the terms and conditions of the charter, bylaws
and each class of capital stock of the Loan Parties and of each
agreement or instrument relating to such structure or capitalization
and (ii) the management of the Borrower.
(c) Before giving effect to the Transaction and the other
transactions contemplated by this Agreement, there shall have occurred
no material adverse change in the business, condition (financial or
otherwise), operations, performance, properties or prospects of the
Borrower and its Subsidiaries taken as a whole since January 2, 1999.
(d) There shall exist no action, suit, investigation,
litigation or proceeding affecting any Loan Party or any of their
Subsidiaries pending or threatened before any court, governmental
agency or arbitrator that (i) is reasonably likely to have a material
adverse effect on (A) the business, condition (financial or otherwise),
operations, performance,
45
properties or prospects of the Borrower and its Subsidiaries taken as a
whole, (B) the rights and remedies of the Administrative Agent or any
Lender Party under any Transaction Document or (C) the ability of the
Borrower and its Subsidiaries taken as a whole to perform their
Obligations under any Transaction Document to which they are or are to
become parties. or (ii) purports to affect the legality, validity or
enforceability of the Transaction or any Transaction Document or the
consummation of the transactions contemplated by the Transaction
Documents.
(e) All governmental and third party consents and approvals
necessary in connection with the Transaction and the other transactions
contemplated by the Transaction Documents shall have been obtained
(without the imposition of any conditions that are not acceptable to
the Lender Parties) and shall remain in effect; all applicable waiting
periods in connection with the Transaction and the other transactions
contemplated by the Transaction Documents shall have expired without
any action having been taken by any competent authority, and no law or
regulation shall be applicable in the judgment of the Lender Parties,
in each case that restrains, prevents or imposes materially adverse
conditions upon the Transaction and the other transactions contemplated
by the Transaction Documents or the rights of the Loan Parties or their
Subsidiaries freely to transfer or otherwise dispose of, or to create
any Lien on, any properties now owned or hereafter acquired by any of
them.
(f) The Lender Parties shall have completed a due diligence
investigation of the Borrower and its Subsidiaries (including, without
limitation, a field examination of the quality of their current assets
and of their management information systems) in scope, and with
results, satisfactory to the Lender Parties, nothing shall have come to
the attention of the Lender Parties during the course of such due
diligence investigation to lead them to believe that the information
provided by or on behalf of the Borrower to the Lender Parties was or
has become misleading, incorrect or incomplete in any material respect,
and the Lender Parties shall have been given such access to the
management, records, books of account, contracts and properties of the
Borrower and its Subsidiaries as they shall have requested.
(g) The Lender Parties shall be satisfied that (i) all
Existing Debt, other than the Surviving Debt identified on Schedule
3.01(g), has been prepaid, redeemed or defeased in full or otherwise
satisfied and extinguished and that all such Surviving Debt shall be on
terms and conditions satisfactory to the Lender Parties, and (ii) all
redeemable preferred stock of the Borrower as at the date of the
Initial Extension of Credit has been duly redeemed.
(h) The Lender Parties shall be satisfied that the assets and
earnings of the Borrower are sufficient to support the Obligations of
the Borrower under this Agreement and the timely amortization of all
Indebtedness and other Obligations of the Borrower and its
Subsidiaries.
(i) All accrued fees and expenses of each Agent and the Lender
Parties (including the accrued fees and expenses of counsel to the
Administrative Agent and of local counsel to the Lender Parties) shall
have been paid.
(j) The Borrower shall have taken all actions which the
Administrative Agent has reasonably requested to assist it in forming a
syndicate acceptable to it including, but not be limited to: (i) making
senior management of the Loan Parties and representatives of the Loan
Parties available to participate in informational meetings with
potential lenders at
46
such times and places as such Agents may reasonably request; and
(ii) timely providing such Agents with all information reasonably
deemed necessary by it to successfully complete the syndication,
including, without limitation, a summary of the operating prospects
(including financial projections) of the Borrower and its Subsidiaries.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING, SWING
LINE ADVANCE AND ISSUANCE. The obligation of each Appropriate Lender to make an
Advance (other than a Letter of Credit Advance made by the Issuing Bank or a
Working Capital Lender pursuant to Section 2.03(c) and a Swing Line Advance made
by a Working Capital Lender pursuant to Section 2.02(b)) on the occasion of each
Borrowing (including the Initial Extension of Credit), and the obligation of the
Issuing Bank to issue a Letter of Credit (including the initial issuance) and
the obligation of the Swing Line Bank to make Swing Line Advances, shall be
subject to the further conditions precedent that on the date of such Borrowing
(including a Swing Line Advance made by the Swing Line Bank), issuance or Swing
Line Advance, (a) the following statements shall be true (and each of the giving
of the applicable Notice of Borrowing, Notice of Swing Line Borrowing, Notice of
Issuance and the acceptance by the Borrower of the proceeds of such Borrowing or
of such Letter of Credit shall constitute a representation and warranty by the
Borrower that both on the date of such notice and on the date of such Borrowing
or issuance such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of such date, before and after giving
effect to such Borrowing or issuance and to the application of the
proceeds therefrom, as though made on and as of such date other than
any such representations or warranties that, by their terms, refer to a
specific date other than the date of such Borrowing or issuance, in
which case as of such specific date;
(ii) no event has occurred and is continuing, or would result
from such Borrowing or issuance or from the application of the proceeds
therefrom, that constitutes a Default; and
(iii) for each Working Capital Advance, Swing Line Advance
made by the Swing Line Bank or issuance of any Letter of Credit, the
sum of the Loan Values of the Eligible Collateral (as determined by the
Administrative Agent based on the most recent Borrowing Base
Certificate delivered to the Lender Parties hereunder) exceeds the
aggregate principal amount of Working Capital Advances plus Swing Line
Advances plus Letter of Credit Advances to be outstanding plus the
aggregate Available Amount of all Letters of Credit then outstanding
after giving effect to such Advance or issuance;
and (b) the Administrative Agent shall have received such other approvals,
opinions or documents as any Appropriate Lender Party through the Administrative
Agent may reasonably request.
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender Party shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lender Parties unless an
officer of the Administrative Agent responsible for the transactions
contemplated by the Loan Documents shall have received notice from such Lender
Party prior to the Initial Extension of Credit specifying its objection thereto
and if the Initial Extension of Credit consists of a Borrowing, such Lender
Party shall not have made available to the Administrative Agent such Lender
Party's ratable portion of such Borrowing.
47
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
The Borrower represents and warrants as follows:
(a) Each Loan Party (i) is a corporation duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (ii) is duly qualified and in good
standing as a foreign corporation in each other jurisdiction in which
it owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed except where the failure to so
qualify or be licensed would not be reasonably likely to have a
Material Adverse Effect and (iii) has all requisite corporate power and
authority (including, without limitation, all governmental licenses,
permits and other approvals) to own or lease and operate its properties
and to carry on its business as now conducted and as proposed to be
conducted. All of the outstanding Equity Interests in the Borrower has
been validly issued, is fully paid and non-assessable and, immediately
following the consummation of the Transaction, is owned free and clear
of all Liens.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party, showing as of the
date hereof (as to each such Subsidiary) the jurisdiction of its
incorporation, the number of shares of each class of its Equity
Interests authorized, and the number outstanding, on the date hereof
and the percentage of the outstanding shares of each such class of its
Equity Interests owned (directly or indirectly) by such Loan Party and
the number of shares covered by all outstanding options, warrants,
rights of conversion or purchase and similar rights at the date hereof.
All of the outstanding Equity Interests in each Loan Party's
Subsidiaries have been validly issued, are fully paid and
non-assessable and are owned by such Loan Party or one or more of its
Subsidiaries free and clear of all Liens, except those created under
the Collateral Documents. Each such Subsidiary (i) is a corporation
duly organized, validly existing and in good standing under the laws of
the jurisdiction of its incorporation, (ii) is duly qualified and in
good standing as a foreign corporation in each other jurisdiction in
which it owns or leases property or in which the conduct of its
business requires it to so qualify or be licensed except where the
failure to so qualify or be licensed would not be reasonably likely to
have a Material Adverse Effect and (iii) has all requisite corporate
power and authority (including, without limitation, all governmental
licenses, permits and other approvals) to own or lease and operate its
properties and to carry on its business as now conducted and as
proposed to be conducted except where the failure to so have requisite
corporate power and authority would not be reasonably likely to have a
Material Adverse Effect.
(c) The execution, delivery and performance by each Loan Party
of each Transaction Document to which it is or is to be a party, and
the consummation of the Transaction and the other transactions
contemplated by the Transaction Documents, are within such Loan Party's
corporate powers, have been duly authorized by all necessary corporate
action, and do not (i) contravene such Loan Party's charter or bylaws,
(ii) violate any law, rule, regulation (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System),
order, writ, judgment, injunction, decree, determination or award,
(iii) conflict with or result in the breach of, or constitute a default
or require any payment to be made under, any contract, loan agreement,
indenture, mortgage, deed of trust, lease or other instrument binding
on or affecting any Loan Party, any of its Subsidiaries or any of their
properties or (iv) except for the Liens created under the Loan
Documents, result in or require the creation or imposition of any Lien
upon or with respect to any of the properties of any Loan Party or any
of its Subsidiaries. No Loan Party or any of its Subsidiaries is in
violation of any such law, rule, regulation, order, writ, judgment,
48
injunction, decree, determination or award or in breach of any such
contract, loan agreement, indenture, mortgage, deed of trust, lease or
other instrument, the violation or breach of which would be reasonably
likely to have a Material Adverse Effect.
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of any
Transaction Document to which it is or is to be a party, or for the
consummation of the Transaction or the other transactions contemplated
by the Transaction Documents, (ii) the grant by any Loan Party of the
Liens granted by it pursuant to the Collateral Documents, (iii) the
perfection or maintenance of the Liens created under the Collateral
Documents (including the first priority nature thereof, subject to the
Permitted Liens) or (iv) the exercise by the Administrative Agent or
any Lender Party of its rights under the Loan Documents or the remedies
in respect of the Collateral pursuant to the Collateral Documents,
except for the authorizations, approvals, actions, notices and filings
listed on Schedule 4.01(d) hereto (or required in connection with the
Liens created under the Collateral Documents), all of which have been
duly obtained, taken, given or made and are in full force and effect.
All applicable waiting periods in connection with the Transaction or
the transactions contemplated by the Transaction Documents have expired
without any action having been taken by any competent authority
restraining, preventing or imposing materially adverse conditions upon
the Transaction and the other transactions contemplated by the
Transaction Documents have expired without any action having been taken
by any competent authority restraining, preventing or imposing
materially adverse conditions upon the Transaction or the rights of the
Loan Parties or their Subsidiaries freely to transfer or otherwise
dispose of, or to create any Lien on, any properties now owned or
hereafter acquired by any of them.
(e) This Agreement has been, and each other Transaction
Document when delivered hereunder will have been, duly executed and
delivered by each Loan Party party thereto. This Agreement is, and each
other Transaction Document when delivered hereunder will be, the legal,
valid and binding obligation of each Loan Party party thereto,
enforceable against such Loan Party in accordance with its terms.
(f) (i) (x) The Consolidated balance sheet of the Borrower and
its Subsidiaries as at January 2, 1999, and the related Consolidated
statements of income and cash flow of the Borrower and its Subsidiaries
for the fiscal year then ended, accompanied, as to the Consolidated
financial statements, by an unqualified opinion of Xxxxx Xxxxxxxx, LLP,
independent public accountants, and (y) the Consolidated balance sheet
of the Borrower and its Subsidiaries dated on or about August 31, 1999,
and the related Consolidated statements of income and cash flow of the
Borrower and its Subsidiaries for the 8 months then ended, in each case
duly certified by the chief financial officer of the Borrower, copies
of which have been furnished to the Administrative Agent, fairly
present, subject, in the case of the statements referred to in clause
(i)(y), to year-end audit adjustments, the Consolidated financial
condition of the Borrower and its Subsidiaries as at such dates and the
Consolidated results of the operations of the Borrower and its
Subsidiaries for the periods ended on such dates, all in accordance
with generally accepted accounting principles applied on a consistent
basis, and
(ii) since January 2, 1999, there has not occurred any event
that would reasonably be likely to have a Material Adverse Change.
(g) The Consolidated forecasted balance sheets, statements of
income and statements of cash flow statements of the Borrower and its
Subsidiaries delivered to the Lender Parties pursuant to Section
3.01(a)(xii) or 5.03 were prepared in good faith on the basis of the
assumptions stated therein, which assumptions were fair in the light of
conditions existing at the time of delivery of such forecasts, and
represented, at the time of delivery and on the date of the Initial
Extension of Credit, the Borrower's best estimate of the future
49
financial performance of the Borrower and its Subsidiaries, it being
understood that such forecasts are estimates and are not guarantees of
actual results.
(h) There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party or any of its Subsidiaries,
including any Environmental Action, pending or, to its knowledge,
threatened before any court, governmental agency or arbitrator that (i)
would be reasonably likely to have a Material Adverse Effect or (ii)
purports to affect the legality, validity or enforceability of any
Transaction Document or the consummation of the transactions
contemplated hereby.
(i) No Loan Party is engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance or drawings under any Letter of Credit will be
used to purchase or carry any Margin Stock or to extend credit to
others for the purpose of purchasing or carrying any Margin Stock.
(j) All filings and other actions necessary or desirable to
perfect and protect the security interest in the Collateral created
under the collateral Documents have been duly made or taken and are in
full force and effect and, subject to the Permitted Liens, the
Collateral Documents create for the benefit of the Secured Parties a
valid and, together with such filings and other actions, perfected
first priority security interest in the Collateral securing the payment
of the Secured Obligations, and all filings and other actions necessary
or desirable to perfect and protect such security interest have been
duly taken. The Loan Parties are the legal and beneficial owners of the
Collateral free and clear of any Lien, except for the liens and
security interests created or permitted under the Loan Documents or the
Permitted Liens.
(k) Neither any Loan Party nor any of its Subsidiaries is (i)
an "investment company", or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company", as such terms are
defined in the Investment Company Act of 1940, as amended or (ii) a
"holding company", or a "subsidiary company" of a "holding company" or
an "affiliate" of a "holding company", or of a "subsidiary company" of
a "holding company" as such terms are defined in the Public Utility
Holding Company Act of 1935, as amended. Neither the making of any
Advances, nor the issuance of any Letters of Credit, nor the
application of the proceeds or repayment thereof by the Borrower, nor
the consummation of the other transactions contemplated hereby, will
violate any provision of any such Act or any rule, regulation or order
of the Securities and Exchange Commission thereunder.
(l) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(m) (i) No ERISA Event has occurred or is reasonably expected
to occur with respect to any Plan.
(ii) As of the last annual actuarial valuation date, the
funded current liability percentage, as defined in Section 302(d)(8) of
ERISA, of each Plan exceeds 90% and there has been no material adverse
change in the funding status of any such Plan since such date.
(iii) Neither any Loan Party nor any ERISA Affiliate has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan.
(iv) Neither any Loan Party nor any ERISA Affiliate has been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or has been terminated, within the meaning of
Title IV of ERISA, and no such Multiemployer Plan is reasonably
expected to be in reorganization or to be terminated, within the
meaning of Title IV of ERISA.
50
(v) Except as set forth in the financial statements referred
to in this Section 4.01 and in Section 5.03, the Loan Parties and their
respective Subsidiaries have no material liability with respect to
"expected post retirement benefit obligations" within the meaning of
Statement of Financial Accounting Standards No. 106.
(vi) Set forth on Schedule 4.01(m)(vi) hereto is a complete
and accurate list of all Plans, Multiemployer Plans and Welfare Plans.
(vii) Schedule B (Actuarial Information) to the most recent
annual report (Form 5500 Series) for each Plan, copies of which have
been filed with the Internal Revenue Service and furnished to the
Lender Parties, is complete and accurate and fairly presents the
funding status of such Plan, and since the date of such Schedule B
there has been no material adverse change in such funding status.
(n) (i) The operations and properties of each Loan Party and
each of its Subsidiaries comply in all respects material to any Loan
Party with all applicable Environmental Laws and Environmental Permits,
all past claims of non-compliance with such Environmental Laws and
Environmental Permits have been resolved without ongoing obligations or
costs, and no circumstances exist that could be reasonably likely to
(x) form the basis of an Environmental Action against any Loan Party or
any of its Subsidiaries or any of its properties that could have a
Material Adverse Effect or (y) cause any such property to be subject to
any material restrictions on ownership, occupancy, use or
transferability under any Environmental Law.
(ii) None of the properties currently or formerly owned or
operated by any Loan Party or of its Material Subsidiaries is listed or
proposed for listing on the NPL or on the CERCLIS or any analogous
foreign, state or local list or is adjacent to any such property; there
are no and never have been any underground or aboveground storage tanks
or any surface impoundments, septic tanks, pits, sumps or lagoons in
which Hazardous Materials are being or have been treated, stored or
disposed on any property currently owned or operated by any Loan Party
or any of its Subsidiaries or, to the best of its knowledge, on any
property formerly owned or operated by any Loan Party or any of its
Subsidiaries; there is no asbestos or asbestos-containing material on
any property currently owned or operated by any Loan Party or any of
its Subsidiaries; and Hazardous Materials have not been released,
discharged or disposed of on any property currently or formerly owned
or operated by any Loan Party or any of its Subsidiaries.
(iii) Neither any Loan Party nor any of its Material
Subsidiaries is undertaking, and has not completed, either individually
or together with other potentially responsible parties, any
investigation or assessment or remedial or response action relating to
any actual or threatened release, discharge or disposal of Hazardous
Materials at any site, location or operation, either voluntarily or
pursuant to the order of any governmental or regulatory authority or
the requirements of any Environmental Law; and all Hazardous Materials
generated, used, treated, handled or stored at, or transported to or
from, any property currently or formerly owned or operated by any Loan
Party or any of its Subsidiaries have been disposed of in a manner not
reasonably expected to result in material liability to any Loan Party
or any of its Subsidiaries.
(o) (i) Each Loan Party and each of its Material Subsidiaries
has filed, has caused to be filed or has been included in all tax
returns (Federal, state, local and foreign) required to be filed and
has paid all taxes shown thereon to be due, together with applicable
interest and penalties.
(ii) Set forth on Schedule 4.01(o) hereto is a complete and
accurate list, as of the date hereof, of each taxable year of each Loan
Party and each of its Material Subsidiaries for which Federal income
tax returns have been filed and for which the expiration of the
51
applicable statute of limitations for assessment or collection has not
occurred by reason of extension or otherwise (an "OPEN YEAR").
(iii) There is no material unpaid amount, as of the date
hereof, of adjustments to the Federal income tax liability of each Loan
Party and each of its Subsidiaries and Affiliates proposed by the
Internal Revenue Service with respect to Open Years. No issues have
been raised by the Internal Revenue Service in respect of Open Years
that, in the aggregate, could have a Material Adverse Effect.
(iv) There is no material unpaid amount, as of the date
hereof, of adjustments to the state, local and foreign tax liability of
each Loan Party and its Subsidiaries and Affiliates proposed by all
state, local and foreign taxing authorities (other than amounts arising
from adjustments to Federal income tax returns, if any). No issues have
been raised by such taxing authorities that, in the aggregate,
reasonably likely to have a Material Adverse Effect.
(v) The Borrower and its Subsidiaries have, as of the date
hereof, a net operating loss carryforwards for U.S. Federal income tax
purposes of approximately$31,000,000 as at January 1, 1999.
(vi) Neither any Loan Party nor any of its Subsidiaries is
party to any tax sharing agreement.
(p) Neither the business nor the properties of any Loan Party
nor any of its Subsidiaries are affected by any fire, explosion,
accident, strike, lockout or other labor dispute, drought, storm, hail,
earthquake, embargo, act of God or of the public enemy or other
casualty (whether or not covered by insurance) that could be reasonably
likely to have a Material Adverse Effect.
(q) Set forth on Schedule 4.01(q) hereto is a complete and
accurate list of all Existing Debt (other than Surviving Debt), showing
as of the date hereof the principal amount outstanding thereunder, the
maturity date thereof and the amortization schedule therefor.
(r) Set forth on Schedule 4.01(r) hereto is a complete and
accurate list of all real property owned by any Loan Party or any of
its Subsidiaries, showing as of the date hereof the street address,
county or other relevant jurisdiction, state, record owner and book and
fair value thereof. Each Loan Party or such Subsidiary has good,
marketable and insurable fee simple title to such real property, free
and clear of all Liens, other than Liens created or permitted by the
Loan Documents. To the best of the Borrower's knowledge, all of the
improvements located on the properties listed on Schedule 4.01(r) lie
entirely within the boundaries of such properties and none of such
improvements violate any minimum set-back requirements, other
dimensional regulations or restrictions of record.
(s) Set forth on Schedule 4.01(s) hereto is a complete and
accurate list of all leases of real property under which any Loan Party
or any of its Subsidiaries is the lessee, showing as of the date hereof
the street address, county or other relevant jurisdiction, state,
lessor, lessee, expiration date and annual rental cost thereof. To the
Borrower's knowledge, each such lease is the legal, valid and binding
obligation of the lessor thereof, enforceable in accordance with its
terms.
(t) As of the date hereof, there are no Investments held by
any Loan Party or any of its Subsidiaries, other than the ownership of
Equity Interests in their respective Subsidiaries as at the date hereof
and intercompany loans permitted under Section 5.02(f).
(u) Set forth on Schedule 4.01(u) hereto is a complete and
accurate list of all patents, trademarks, trade names, service marks
and copyrights, and all applications therefor
52
and licenses thereof, of each Loan Party or any of its Subsidiaries,
showing as of the date hereof the jurisdiction in which registered, the
registration number, the date of registration and the expiration date.
(v) Set forth on Schedule 4.01(v) hereto is a complete and
accurate list of all Liens on the property or assets of any Loan Party
or any of its Subsidiaries, showing as of the date hereof the
lienholder thereof, the principal amount of the obligations secured
thereby and the property or assets of such Loan Party or such
Subsidiary subject thereto.
(w) Each Loan Party has reviewed the areas within its business
and operations which could be adversely affected by "Year 2000 Issues"
(i.e., the risk that computer applications used by such Loan Party may
be unable to recognize or perform properly date sensitive functions
involving certain dates prior to, and any date after, December 31,
1999) and, based on such review, such Loan Party reasonably believes
that the "Year 2000 Issues" (and the cost of remedying the same) will
not have a Material Adverse Effect.
(x) Neither EEZI Air Services Limited, registered in England
(Company Number 02481657), nor Safety 1st International, Inc.,
incorporated in the Virgin Islands, is a Material Subsidiary.
ARTICLE V
COVENANTS
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance or
any other Obligation of any Loan Party under or in respect of any Loan Document
shall remain unpaid, any Letter of Credit shall be outstanding, any Secured
Hedge Agreement shall be in effect or any Lender Party shall have any Commitment
hereunder, the Borrower will:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each other
Loan Party and each of its other Material Subsidiaries to comply, in
all material respects, with all applicable laws, rules, regulations and
orders, such compliance to include, without limitation, compliance with
ERISA and the Racketeer Influenced and Corrupt Organizations Chapter of
the Organized Crime Control Act of 1970.
(b) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each
other Loan Party and each of its other Material Subsidiaries to pay and
discharge, before the same shall become delinquent, (i) all taxes,
assessments and governmental charges or levies imposed upon it or upon
its property and (ii) all lawful claims that, if unpaid, might by law
become a Lien upon its property which is not otherwise permitted
hereunder; provided, however, that neither the Borrower nor any of its
Subsidiaries shall be required to pay or discharge any such tax,
assessment, charge or claim that is being contested in good faith and
by proper proceedings and as to which appropriate reserves are being
maintained, unless and until any Lien resulting therefrom attaches to
its property and becomes enforceable against its other creditors and
the Lien is not stayed or discharged within 45 days.
(c) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply, and cause each
of its Subsidiaries and all lessees and other Persons operating or
occupying its properties to comply, in all material respects (which as
to those Subsidiaries that are not Material Subsidiaries, shall be only
to the extent any failure by such Subsidiary to so comply shall have a
Material Adverse Effect), with all applicable Environmental Laws and
Environmental Permits; obtain and renew and cause each of its
Subsidiaries to obtain and renew all Environmental Permits necessary
for its operations and properties; and conduct, and cause each of its
Subsidiaries to conduct, any investigation, study, sampling and
testing, and undertake any cleanup, removal, remedial or other action
necessary to remove and clean up
53
all Hazardous Materials from any of its properties, in accordance
with the requirements of all Environmental Laws; provided,
however, that neither the Borrower nor any of its Subsidiaries shall be
required to undertake any such cleanup, removal, remedial or other
action to the extent that its obligation to do so is being contested in
good faith and by proper proceedings and appropriate reserves are being
maintained with respect to such circumstances.
(d) MAINTENANCE OF INSURANCE. Maintain, and cause each other
Loan Party and each of its other Material Subsidiaries to maintain,
insurance with responsible and reputable insurance companies or
associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar
properties in the same general areas in which the Borrower, such Loan
Party or such Subsidiary operates.
(e) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and
maintain, and cause each other Loan Party and each of its other
Material Subsidiaries to preserve and maintain, its corporate
existence, rights (charter and statutory), permits, licenses,
approvals, privileges and franchises; provided, however, that the
Borrower may consummate any merger or consolidation permitted under
Section 5.02(d) and provided further that neither the Borrower nor any
of its Subsidiaries shall be required to preserve any right, permit,
license, approval, privilege or franchise if the Board of Directors of
the Borrower or such Subsidiary shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the
Borrower or such Subsidiary, as the case may be, and that the loss
thereof is not disadvantageous in any material respect to the Borrower,
such Subsidiary or the Lender Parties.
(f) VISITATION RIGHTS. At any reasonable time and from time to
time, upon reasonable prior notice, permit the Administrative Agent or
any of the Lender Parties or any agents or representatives thereof, to
examine and make copies of and abstracts from the records and books of
account of, and visit the properties of, the Borrower and any of its
Subsidiaries, and to discuss the affairs, finances and accounts of the
Borrower and any of its Subsidiaries with any of their officers or
directors and with their independent certified public accountants;
provided, however, that, so long as no Default shall have occurred and
be continuing, the Borrower shall not be required to permit more than
three such visits in any Fiscal Year.
(g) KEEPING OF BOOKS. Keep, and cause each other Loan Party
and each of its other Material Subsidiaries to keep, proper books of
record and account, in which full and correct entries shall be made of
all financial transactions and the assets and business of the Borrower
and each such Subsidiary in accordance with generally accepted
accounting principles in effect from time to time.
(h) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each other Loan Party and each of its other Material Subsidiaries
to maintain and preserve, all of its properties that are reasonably
required in the conduct of its business in good working order and
condition, ordinary wear and tear excepted.
(i) TRANSACTIONS WITH AFFILIATES. Conduct, and cause each
other Loan Party and each of its other Material Subsidiaries to
conduct, all transactions otherwise permitted under the Loan Documents
with any of their Affiliates on terms that are fair and reasonable and
no less favorable to the Borrower or such Subsidiary than it would
obtain in a comparable arm's-length transaction with a Person not an
Affiliate.
(j) COVENANT TO GUARANTEE OBLIGATIONS AND GIVE SECURITY. Upon
(w) the request of the Administrative Agent, (x) the formation or
acquisition of any new direct or indirect Foreign Subsidiary which is a
Material Subsidiary or Domestic Subsidiary of any Loan Party, (y) any
Subsidiary which is not a Material Subsidiary becoming a Material
Subsidiary, or (z)
54
the acquisition of any property by any Loan Party, and such property,
in the judgment of the Administrative Agent, shall not already be
subject to a perfected first priority security interest in favor
of the Administrative Agent for the benefit of the Secured
Parties, then the Borrower shall, in each case at the Borrower's
expense:
(i) within 10 days after such request, formation or
acquisition of a Subsidiary, or such Subsidiary becoming a
Material Subsidiary, cause each such (A) Domestic Subsidiary
and each direct and indirect Subsidiary of such Domestic
Subsidiary to duly execute and deliver to the Administrative
Agent an appropriate guaranty or guaranty supplement, in form
and substance satisfactory to the Administrative Agent,
guaranteeing all of the Loan Parties' Obligations under the
Loan Documents and (B) Foreign Subsidiary which is a Material
Subsidiary to duly execute and deliver to the Administrative
Agent an appropriate guaranty or guaranty supplement, in form
and substance satisfactory to the Administrative Agent;
provided that no guaranty may be required (if acceptable to
the Administrative Agent) from a Subsidiary organized or
located outside of the United States if the execution and
delivery thereof would result in material adverse tax
consequences to the Loan Parties;
(ii) within 10 days after such request, formation or
acquisition, or such Subsidiary becoming a Material
Subsidiary, furnish to the Administrative Agent a description
of the real and personal properties of the Borrower and its
Subsidiaries in detail satisfactory to the Administrative
Agent;
(iii) within 15 days after such request, formation or
acquisition, duly execute and deliver, and cause each such
Subsidiary, and cause each direct and indirect parent of such
Subsidiary to duly execute and deliver to the Administrative
Agent mortgages, pledges, assignments, security agreement
supplements and other security agreements, as specified by and
in form and substance reasonably satisfactory to the
Administrative Agent, securing payment of all the Obligations
of the Loan Parties under the Loan Documents and constituting
Liens on all such properties;
(iv) within 30 days after such request, formation or
acquisition, or such Subsidiary becoming a Material
Subsidiary, duly execute and deliver, and cause each such
Subsidiary, and cause each direct and indirect parent of such
Subsidiary (other than any Subsidiary organized or located
outside of the United States) to take whatever action
(including, without limitation, the recording of mortgages,
the filing of Uniform Commercial Code financing statements,
the giving of notices and the endorsement of notices on title
documents) may be necessary or advisable in the opinion of the
Administrative Agent to vest in the Administrative Agent (or
in any representative of the Administrative Agent designated
by it) valid and subsisting Liens on the properties purported
to be subject to the mortgages, pledges, assignments, security
agreement supplements and other security agreements delivered
pursuant to this Section 5.01(j), enforceable against all
third parties in accordance with their terms;
(v) within 60 days after such request, formation or
acquisition, or such Subsidiary becoming a Material
Subsidiary, deliver to the Administrative Agent, upon the
request of the Administrative Agent in its sole discretion, a
signed copy of a favorable opinion, addressed to the
Administrative Agent and the other Secured Parties, of counsel
for the Loan Parties reasonably acceptable to the
Administrative Agent as to the matters contained in clauses
(i), (iii) and (iv) above, as to such mortgages, pledges,
assignments, security agreement supplements and other security
agreements being legal, valid and binding obligations of each
such Loan Party
55
enforceable in accordance with their terms and as to such
other matters as the Administrative Agent may reasonably
request;
(vi) as promptly as practicable after such request,
formation or acquisition, or such Subsidiary becoming a
Material Subsidiary, deliver, upon the request of the
Administrative Agent in its sole discretion, to the
Administrative Agent with respect to each parcel of real
property owned or held by the entity that is the subject of
such request, formation or acquisition, or which has become a
Material Subsidiary title reports, surveys and engineering,
soils and other reports, and environmental assessment reports,
each of scope, form and substance reasonably satisfactory to
the Administrative Agent, provided, however, that to the
extent that any Loan Party or any of its Subsidiaries shall
have otherwise received any of the foregoing items with
respect to such real property, such items shall promptly after
the receipt thereof be delivered to the Administrative Agent;
(vii) at any time and from time to time, promptly
execute and deliver any and all further instruments and
documents and take all such other action as the Administrative
Agent may deem reasonably necessary or desirable in obtaining
the full benefits of, or in perfecting and preserving the
Liens of, such guaranties, mortgages, pledges, assignments,
security agreements and security agreement supplements; and
(viii) promptly upon such request, formation or
acquisition related to any Foreign Subsidiary or any domestic
or foreign joint venture, or upon any Foreign Subsidiary
becoming a Material Subsidiary, the Borrower shall pledge to
the Administrative Agent on behalf of the Secured Parties (to
the extent that it has not already done so) (A) in the case of
any Foreign Subsidiary or joint venture, 100% of the total
outstanding shares or other ownership interests of such Person
owned by the Borrower and (B) in the case of any domestic
joint venture, 100% of the shares or other ownership interests
of such Person held by the Borrower.
(k) FURTHER ASSURANCES. (i) Promptly upon request by the
Administrative Agent, or any Lender Party through the Administrative
Agent, correct any material defect or error that may be discovered in
any Loan Document or in the execution, acknowledgment, filing or
recordation thereof, and
(ii) Promptly upon request by the Administrative Agent, or any
Lender Party through the Administrative Agent, do, execute,
acknowledge, deliver, record, re-record, file, re-file, register and
re-register any and all such further acts, deeds, conveyances, pledge
agreements, mortgages, deeds of trust, trust deeds, assignments,
financing statements and continuations thereof, termination statements,
notices of assignment, transfers, certificates, assurances and other
instruments as the Administrative Agent, or any Lender Party through
the Administrative Agent, may reasonably require from time to time in
order to (A) carry out more effectively the purposes of the Loan
Documents, (B) to the fullest extent permitted by applicable law,
subject any Loan Party's or any of its Subsidiaries' properties,
assets, rights or interests to the Liens now or hereafter intended to
be covered by any of the Collateral Documents, (C) perfect and maintain
the validity, effectiveness and priority of any of the Collateral
Documents and any of the Liens intended to be created thereunder and
(D) assure, convey, grant, assign, transfer, preserve, protect and
confirm more effectively unto the Administrative Agent and the Lender
parties the rights granted or now or hereafter intended to be granted
to the Administrative Agent and the Lender Parties under any Loan
Document or under any other instrument executed in connection with any
Loan Document to which any Loan Party or any of its Subsidiaries is or
is to be a party, and cause each of its Subsidiaries to do so.
56
(l) PERFORMANCE OF RELATED DOCUMENTS. Perform and observe, and
cause each other Loan Party and each of its other Material Subsidiaries
to perform and observe, all of the terms and provisions of each Related
Document to be performed or observed by it, maintain each such Related
Document in full force and effect, enforce such Related Document in
accordance with its terms, take all such action to such end as may be
from time to time reasonably requested by the Administrative Agent and,
upon request of the Administrative Agent, make to each other party to
each such Related Document such demands and requests for information
and reports or for action as such Loan Party or any of its Subsidiaries
is entitled to make under such Related Document.
(m) PREPARATION OF ENVIRONMENTAL REPORTS. At the request of
the Administrative Agent, provide to the Lender Parties within 60 days
after such request, at the expense of the Borrower, a Phase I
environmental site assessment report for any of its or its Material
Subsidiaries' properties described in such request, prepared by an
environmental consulting firm acceptable to the Administrative Agent
(and, if based upon the recommendation of such environmental consulting
firm, a Phase II environmental site assessment report) indicating the
presence or absence of Hazardous Materials and the estimated cost of
any compliance, removal or remedial action in connection with any
Hazardous Materials on such properties; without limiting the generality
of the foregoing, if the Administrative Agent determines at any time
that a material risk exists that any such report will not be provided
within the time referred to above, the Administrative Agent may retain
an environmental consulting firm to prepare such report at the expense
of the Borrower, and the Borrower hereby grants and agrees to cause any
Subsidiary that owns any property described in such request to grant at
the time of such request, to the Administrative Agent, the Lender
Parties, such firm and any agents or representatives thereof an
irrevocable non-exclusive license, subject to the rights of tenants, to
enter onto their respective properties to undertake such an assessment.
(n) COMPLIANCE WITH TERMS OF LEASEHOLDS. Make all payments and
otherwise perform all obligations in respect of all leases of real
property to which the Borrower, each other Loan Party or any of its
other Material Subsidiaries is a party, keep such leases in full force
and effect and not allow such leases to lapse or be terminated or any
rights to renew such leases to be forfeited or canceled, notify the
Administrative Agent of any material default by any party with respect
to such leases and cooperate with the Administrative Agent in all
respects to cure any such default, and cause each of its Subsidiaries
to do so except, in any case, where the failure to do so, either
individually or in the aggregate, would not be reasonably likely to
have a Material Adverse Effect.
(o) INTEREST RATE HEDGING. Enter into prior to December 1,
1999, and maintain at all times thereafter, interest rate Hedge
Agreements with Persons reasonably acceptable to the Administrative
Agent, covering a notional amount of not less than 50% of the
Commitments under all of the Facilities on terms reasonably acceptable
to the Administrative Agent; provided, however, that each such interest
rate Hedge Agreement shall be for a minimum term of two years, but, in
such event, shall be extended, renewed or replaced for at least another
two year period before the termination thereof.
(p) BLOCKED ACCOUNT. Within 60 days of the Initial Extension
of Credit, it will close all accounts held by it with BT Commercial
Corporation.
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance or
any other Obligation of any Loan Party under or in respect of any Loan Document
shall remain unpaid, any Letter of Credit shall be outstanding, any Secured
Hedge Agreement shall be in effect or any Lender Party shall have any Commitment
hereunder, the Borrower will not, at any time:
(a) LIENS, ETC. Create, incur, assume or suffer to exist, or
permit any other Loan Party or any of its other Material Subsidiaries
to create, incur, assume or suffer to exist, any Lien on or with
respect to any of its properties of any character (including, without
57
limitation, accounts) whether now owned or hereafter acquired, or sign
or file or suffer to exist, or permit any other Loan Party or any of
its other Material Subsidiaries to sign or file or suffer to exist,
under the Uniform Commercial Code of any jurisdiction, a financing
statement that names the Borrower or any other Loan Party or any of its
other Material Subsidiaries as debtor, or sign or suffer to exist, or
permit any other Loan Party or any of its other Material Subsidiaries
to sign or file or suffer to exist, under the Uniform Commercial Code
of any jurisdiction, a financing statement that names the Borrower or
any other Loan Party or any of its other Material Subsidiaries as
debtor, or sign or suffer to exist, or permit any other Loan Party or
any of its other Material Subsidiaries to sign or suffer to exist, any
security agreement authorizing any secured party thereunder to file
such financing statement, or assign, or permit any other Loan Party or
any of its other Material Subsidiaries to assign any accounts or other
right to receive income, excluding, however, from the operation of the
foregoing restrictions, the following:
(i) Liens created under the Loan Documents;
(ii) Permitted Liens;
(iii) Liens existing on the date hereof and
described on Schedule 4.01(v) hereto;
(iv) Liens arising in connection with
Capitalized Leases permitted under Section 5.02(b)(i)(B);
provided that no such Lien shall extend to or cover any
Collateral or assets other than the assets subject to such
Capitalized Leases;
(v) purchase money Liens upon or in real property or
equipment acquired or held by the Borrower or any of its
Subsidiaries in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt
incurred solely for the purpose of financing the acquisition
of any such property or equipment to be subject to such Liens,
or Liens existing on any such property or equipment at the
time of acquisition (other than any such Liens created in
contemplation of such acquisition that do not secure the
purchase price), or extensions, renewals or replacements of
any of the foregoing for the same or a lesser amount;
provided, however, that no such Lien shall extend to or cover
any property other than the property or equipment being
acquired, and no such extension, renewal or replacement shall
extend to or cover any property not theretofore subject to the
Lien being extended, renewed or replaced; and provided further
that the aggregate principal amount of the Debt secured by
Liens permitted by this clause (v) shall not exceed the amount
permitted under Section 5.02(b)(i)(C) at any time outstanding
and that any such Debt shall not otherwise be prohibited by
the terms of the Loan Documents;
(vi) the filing of financing statements solely as a
precautionary measure in connection with operating leases;
(vii) Liens on assets of the Subsidiaries securing
the Intercompany Notes; and
(viii) the replacement, extension or renewal
of any Lien permitted by clause (iii) above upon or in the
same property theretofore subject thereto or the replacement,
extension or renewal (without increase in the amount or change
in any direct or contingent obligor) of the Debt secured
thereby.
(b) DEBT. Create, incur, assume or suffer to exist, or permit
any of its Subsidiaries to create, incur, assume or suffer to exist,
any Debt other than:
58
(i) in the case of the Borrower, Debt in respect of
Hedge Agreements designed to hedge against fluctuations in
interest rates or foreign exchange rates incurred in the
ordinary course of business and consistent with prudent
business practice in an aggregate notional amount not to
exceed $35,000,000 for interest rate Hedge Agreements and
$10,000,000 for foreign exchange Hedge Agreements at any time
outstanding; and
(ii) in the case of the Loan Parties,
(A) Debt under the Loan Documents,
(B) Capitalized Leases not to exceed in the
aggregate, together with Debt permitted under Section
5.02(b)(i)(C), $2,000,000 at any time outstanding,
(C) Debt secured by Liens permitted by
Section 5.02(a)(v) not to exceed in the aggregate,
together with Debt permitted under Section
5.02(b)(i)(B), $2,000,000 at any time outstanding,
(D) Debt owed to the Borrower to the extent
permitted by Section 5.02(f)(i); provided, however,
that all such Debt shall be evidenced by an
Intercompany Note, and
(E) other unsecured Debt in an aggregate
amount not to exceed $1,000,000 at any time
outstanding; and
(iii) in the case of the Borrower and any of its
Subsidiaries, indorsement of negotiable instruments for
deposit or collection or similar transactions in the ordinary
course of business or under indemnity provisions contained in
contracts entered into by the Borrower or any of its
Subsidiaries in good faith and in the ordinary course of
business.
(c) CHANGE IN NATURE OF BUSINESS. Make, or permit any
of its Subsidiaries to make, any material change in the nature of its
business as carried on at the date hereof.
(d) MERGERS, ETC. Merge into or consolidate with any Person or
permit any Person to merge into it, or permit any of its Subsidiaries
to do so, except that any Subsidiary of the Borrower may merge into or
consolidate with the Borrower or any other such Subsidiary, so long as
the surviving Person is the Borrower or, if the merger or consolidation
is with a Subsidiary other than the Borrower, such surviving Person is
a wholly owned Domestic Subsidiary of the Borrower; provided, however,
that in each case, immediately after giving effect thereto, no event
shall occur and be continuing that constitutes a Default.
(e) SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets, or grant any option or other right
to purchase, lease or otherwise acquire any assets, except:
(i) sales of Inventory (including, without
limitation, sales of obsolete Inventory) in the ordinary
course of its business,
(ii) in a transaction authorized by subsection (d) of
this Section, and
(iii) sales or trade-ins of used equipment for fair
value in the ordinary course of business for like assets or
cash in an aggregate amount not to exceed $250,000 in any
Fiscal Year.
59
(f) INVESTMENTS. Make or hold, or permit any of its
Subsidiaries to make or hold, any Investment other than:
(i) Investments by the Borrower in:
(w) wholly-owned Subsidiaries consisting of
Equity Interests outstanding on the date hereof;
(x) wholly-owned Domestic Subsidiaries which
are Material Subsidiaries in an aggregate amount for
such Subsidiaries not to exceed $100,000;
(y) additional Investments by the Borrower
solely as intercompany advances (evidenced by
Intercompany Notes) (A) to Safety Europe in an
aggregate amount invested from the date hereof not
to exceed $2,500,000 and (B) to Safety Canada in an
aggregate amount invested from the date hereof not
to exceed $4,500,000; and
(z) loans and advances to employees in the
ordinary course of the business of the Borrower and
its Subsidiaries as presently conducted in an
aggregate principal amount not to exceed $250,000 at
any time outstanding;
(ii) Investments by the Borrower in demand deposit
accounts maintained in the ordinary course of business with
any Person of the type referred to in clause (i), (ii), (iii),
(iv) or (v) of the definition of "ELIGIBLE ASSIGNEE" and in
Cash Equivalents not on deposit in Blocked Accounts in an
amount not to exceed $250,000 and in deposits in Blocked
Accounts in an aggregate amount not to exceed $2,000,000; and
(iii) Investments by the Borrower in Hedge Agreements
permitted under Section 5.02(b)(i);
(iv) Investments by Foreign Subsidiaries that are
Material Subsidiaries in demand deposit accounts maintained in
the ordinary course of business with any Person acceptable to
the Administrative Agent and in Cash Equivalents not on
deposit in accounts subject to a Lien in favor of the Secured
Parties on terms acceptable to the Administrative Agent (the
"FOREIGN APPROVED ACCOUNTS") in an amount not to exceed
$250,000 and in deposits in Foreign Approved Accounts in an
aggregate amount not to exceed $1,250,000; and
(g) RESTRICTED PAYMENTS. Declare or pay any dividends,
purchase, redeem, retire, defease or otherwise acquire for value any of
its Equity Interests now or hereafter outstanding, return any capital
to its stockholders, partners or members (or the equivalent Persons
thereof) stockholders, partners or members (or the equivalent Persons
thereof) as such or issue or sell any Equity Interests or accept any
capital contributions, or permit any of its Subsidiaries to purchase,
redeem, retire, defease or otherwise acquire for value Equity Interests
of the Borrower or to issue or sell any Equity Interests therein,
except that, so long as no Default shall have occurred and be
continuing at the time of any action described in clause (i) or (ii)
below or would result therefrom:
(i) the Borrower may (A) declare and pay
dividends and distributions payable only in common stock of
the Borrower and (B) issue and sell shares of its capital
stock, and
60
(ii) any Subsidiary of the Borrower may (A)
declare and pay cash dividends to the Borrower, (B) declare
and pay cash dividends to any other wholly owned Domestic
Subsidiary of the Borrower of which it is a Subsidiary and (C)
accept capital contributions from its parent to the extent
permitted under Section 5.01(f).
(h) AMENDMENT OF CONSTITUTIVE DOCUMENTS. Amend, or permit any
other Loan Party or any of its other Material Subsidiaries to amend,
its certificate of incorporation, bylaws or other constitutive
documents.
(i) ACCOUNTING CHANGES. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in (i) accounting policies
or reporting practices, except as required by generally accepted
accounting principles or (ii) Fiscal Year.
(j) PREPAYMENTS, ETC. OF DEBT. (i) Prepay, redeem, purchase,
defease or otherwise satisfy prior to the scheduled maturity thereof in
any manner, or make any payment in violation of any subordination terms
of, any Debt, other than (x) the prepayment of the Advances in
accordance with the terms of this Agreement, and (y) if before and
after giving effect to any such prepayment, redemption, purchase,
defeasance or other satisfaction, no Default has occurred or would
result therefrom, regularly scheduled or required repayments or
redemptions of Surviving Debt, or (ii) amend, modify or change in any
manner any term or condition of any Surviving Debt, or permit any of
its Subsidiaries to do any of the foregoing other than to prepay any
Debt payable to the Borrower.
(k) AMENDMENT, ETC. OF RELATED DOCUMENTS. Cancel or terminate
any Related Document or consent to or accept any cancellation or
termination thereof, amend, modify or change in any manner any term or
condition of any Related Document or give any consent, waiver or
approval thereunder, waive any default under or any breach of any term
or condition of any Related Document, agree in any manner to any other
amendment, modification or change of any term or condition of any
Related Document or take any other action in connection with any
Related Document except where the foregoing would not impair the value
of the interest or rights of any Loan Party thereunder or that would
not impair the rights or interests of the Administrative Agent or any
Lender Party; or permit any of its Subsidiaries to do any of the
foregoing.
(l) NEGATIVE PLEDGE. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets other than (i) in favor of the Secured
Parties or (ii) in connection with (A) any Surviving Debt, (B) any Debt
secured by purchase money Liens and Capitalized Leases, in each case,
to the extent permitted under Sections 5.02(b)(i)(B) and (C),
respectively, and solely to the extent such agreement is limited to the
property covered by such Liens.
(m) PARTNERSHIPS. Become a general partner in any general or
limited partnership or joint venture, or permit any of its Subsidiaries
to do so other than any Subsidiary the sole assets of which consist of
its interest in such partnership or joint venture and to the extent
permitted by Section 5.02(f)(ii).
(n) FORMATION OF SUBSIDIARIES. Organize or invest, or permit
any Subsidiary to organize or invest, in any new Subsidiary except to
the extent permitted by Section 5.02(f) and in compliance with Section
5.01(j).
(o) PAYMENT RESTRICTIONS AFFECTING SUBSIDIARIES. Directly or
indirectly, enter into or suffer to exist, or permit any of its
Subsidiaries to enter into or suffer to exist, any agreement or
arrangement limiting the ability of any of its Subsidiaries to declare
or pay dividends or other distributions in respect of its Equity
Interests or repay or prepay any Debt
61
owed to, make loans or advances to, or otherwise transfer assets to or
invest in, the Borrower or any Subsidiary of the Borrower (whether
through a covenant restricting dividends, loans, asset transfers or
investments, a financial covenant or otherwise), except the Loan
Documents.
(p) OTHER TRANSACTIONS. Engage, or permit any of its
Subsidiaries to engage, in any transaction involving commodity options
or futures contracts or any similar speculative transactions
(including, without limitation, take-or-pay contracts).
SECTION 5.03. REPORTING REQUIREMENTS. So long as any
Obligation of any Loan Party under or in respect of any Loan Document shall
remain unpaid, any Letter of Credit shall be outstanding, any Secured Hedge
Agreement shall be in effect, or any Lender Party shall have any Commitment
hereunder, the Borrower will furnish to the Administrative Agent and the Lender
Parties:
(a) DEFAULT AND PREPAYMENT NOTICES. As soon as possible and in
any event within two Business Days after the occurrence of each Default
or any event, development or occurrence reasonably likely to have a
Material Adverse Effect continuing on the date of such statement, a
statement of the chief financial officer of the Borrower setting forth
details of such Default, event, development or occurrence and the
action that the Borrower has taken and proposes to take with respect
thereto.
(b) MONTHLY FINANCIALS. As soon as available and in any event
within 30 days after the end of each month (other than for each month
on which a Fiscal Quarter is also ending, in which event such
financials shall be delivered within 45 days), commencing October 31,
1999, a Consolidated and consolidating balance sheets of the Borrower
and its Subsidiaries, in each case as of the end of such month and
Consolidated and consolidating statements of income and cash flow of
the Borrower and its Subsidiaries, in each case for the period
commencing at the end of the previous month and ending with the end of
such month and Consolidated and consolidating statements of income and
cash flow of the Borrower and its Subsidiaries for the period
commencing at the end of the previous Fiscal Year and ending with the
end of such month, setting forth in each case in comparative form the
corresponding figures for the corresponding month and Fiscal
Year-to-date period of the preceding Fiscal Year and the corresponding
figures for the corresponding month and Fiscal Year-to-date period of
the annual forecast previously delivered pursuant to Section 5.03(f),
all in reasonable detail and duly certified by the chief financial
officer of the Borrower, together with (i) a certificate of said
officer stating that no Default has occurred and is continuing or, if a
Default has occurred and is continuing, a statement as to the nature
thereof and the action that the Borrower has taken and proposes to take
with respect thereto.
(c) COMPLIANCE CERTIFICATES. Together with the monthly
financial statements referred to in Section 5.03(b) for each Fiscal
Quarter and the annual financial statements referred to in Section
5.03(d), a schedule in form satisfactory to the Administrative Agent of
the computations used by the Borrower in determining compliance with
the covenants contained in Sections 5.04(a) through (d), provided that,
in the event of any change in GAAP used in the preparation of such
financial statements, the Borrower shall also provide, if necessary for
the determination of compliance with Section 5.04, a statement of
reconciliation conforming such financial statements to GAAP.
(d) ANNUAL FINANCIALS. As soon as available and in any event
within 90 days after the end of each Fiscal Year, a copy of the annual
audit report for such year for the Borrower and its Subsidiaries,
including therein Consolidated and consolidating balance sheets of the
Borrower and its Subsidiaries, in each case as of the end of such
Fiscal Year, and Consolidated and consolidating statements of income
and cash flow of the Borrower and its Subsidiaries, in each case for
the period commencing at the end of the previous Fiscal Year and ending
with the end of such Fiscal Year, accompanied as to such Consolidated
62
statements, by an unqualified opinion of Xxxxx Xxxxxxxx, LLP or other
independent public accountants of recognized standing acceptable to the
Required Lenders, together with (i) a copy of any management letter
prepared by such accounting firm with respect to such Fiscal Year and
distributed to the Borrower, (ii) a certificate of the chief financial
officer of the Borrower stating that no Default has occurred and is
continuing or, if a default has occurred and is continuing, a statement
as to the nature thereof and the action that the Borrower has taken and
proposes to take with respect thereto, (iii) in the event of any change
from GAAP in the generally accepted accounting principles used in the
preparation of such financial statements, a statement of reconciliation
conforming such financial statements to GAAP and (iv) a schedule in
form satisfactory to the Administrative Agent of the computations used
by the Borrower in determining compliance with the covenants contained
in Sections 5.04(a) through (d).
(e) ANNUAL FORECASTS. As soon as available and in any event no
later than 30 days prior to the end of each Fiscal Year, forecasts
prepared by management of the Borrower, in form satisfactory to the
Administrative Agent, of Consolidated balance sheets, income statements
and cash flow statements on a monthly basis for the Fiscal Year
following such Fiscal Year then ended.
(f) ERISA. (i) ERISA EVENTS AND ERISA REPORTS. (A) Promptly
and in any event within 10 days after any Loan Party or any ERISA
Affiliate knows or has reason to know that any ERISA Event has
occurred, a statement of the Chief Financial Officer of the Borrower
describing such ERISA Event and the action, if any, that such Loan
Party or such ERISA Affiliate has taken and proposes to take with
respect thereto and (B) on the date any records, documents or other
information must be furnished to the PBGC with respect to any Plan
pursuant to Section 4010 of ERISA, a copy of such records, documents
and information.
(ii) PLAN TERMINATIONS. Promptly and in any event within two
Business Days after receipt thereof by any Loan Party or any ERISA
Affiliate, copies of each notice from the PBGC stating its intention to
terminate any Plan or to have a trustee appointed to administer any
Plan.
(iii) PLAN ANNUAL REPORTS. Promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service, copies
of each Schedule B (Actuarial Information) to the annual report (Form
5500 Series) with respect to each Plan.
(iv) MULTIEMPLOYER PLAN NOTICES. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party or
any ERISA Affiliate from the sponsor of a Multiemployer Plan, copies of
each notice concerning (A) the imposition of Withdrawal Liability by
any such Multiemployer Plan, (B) the reorganization or termination,
within the meaning of Title IV of ERISA, of any such Multiemployer Plan
or (C) the amount of liability incurred, or that may be incurred, by
such Loan Party or any ERISA Affiliate in connection with any event
described in clause (A) or (B).
(g) LITIGATION. Promptly after the commencement thereof,
notice of all actions, suits, investigations, litigation and
proceedings before any court or governmental department, commission,
board, bureau, agency or instrumentality, domestic or foreign,
reasonably likely to materially affect any Loan Party or any of its
Subsidiaries of the type described in Section 4.01(h).
(h) SECURITIES REPORTS. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and
reports that any Loan Party or any of its Subsidiaries sends to its
stockholders, and copies of all regular, periodic and special reports,
and all registration statements, that any Loan Party or any of its
Subsidiaries files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or with any
national securities exchange.
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(i) CREDITOR REPORTS. Promptly after the furnishing thereof,
copies of any statement or report furnished to any other holder of the
Debt of any Loan Party or of any of its Subsidiaries including, without
limitation, loan or credit or similar agreement and not otherwise
required to be furnished to the Lender Parties pursuant to any other
clause of this Section 5.03.
(j) AGREEMENT NOTICES. Promptly upon receipt thereof, copies
of all notices, requests and other documents received by any Loan Party
or any of its Subsidiaries under or pursuant to any Related Document or
indenture, loan or credit or similar agreement regarding or related to
any breach or default by any party thereto or any other event that
could materially impair the value of the interests or the rights of any
Loan Party or any of its Subsidiaries or otherwise have a Material
Adverse Effect and copies of any amendment, modification or waiver of
any provision of any Related Agreement or indenture, loan or credit or
similar agreement and, from time to time upon request by the
Administrative Agent, such information and reports regarding the
Related Documents as the Administrative Agent may reasonably request.
(k) REVENUE AGENT REPORTS. Within 10 days after receipt,
copies of all Revenue Agent Reports (Internal Revenue Service Form
886), or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive adjustments to the
Federal income tax liability of the affiliated group (within the
meaning of Section 1504(a)(1) of the Internal Revenue Code) of which
the Borrower is a member aggregating $250,000 or more.
(l) ENVIRONMENTAL CONDITIONS. Promptly after the assertion or
occurrence thereof, notice of any Environmental Action against or of
any noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit that could reasonably be
expected to have a Material Adverse Effect.
(m) REAL PROPERTY. As soon as available and in any event
within 30 days after the end of each Fiscal Year, a report
supplementing Schedules 4.01(r) and 4.01(s) hereto, including an
identification of all real and leased property disposed of by the
Borrower or any of its Subsidiaries during such Fiscal Year, a list and
description (including the street address, county or other relevant
jurisdiction, state, record owner, book value thereof, and in the case
of leases of property, lessor, lessee, expiration date and annual
rental cost thereof) of all real property acquired or leased during
such Fiscal Year and a description of such other changes in the
information included in such Schedules as may be necessary for such
Schedules to be accurate and complete.
(n) INSURANCE. As soon as available and in any event within 30
days after the end of each Fiscal Year, a report summarizing the
insurance coverage (specifying type, amount and carrier) in effect for
the Borrower and its Subsidiaries and containing such additional
information as any Lender Party (through the Administrative Agent) may
reasonably specify.
(o) BORROWING BASE CERTIFICATE. As soon as available and in
any event within 15 days after the end of each month, a Borrowing Base
Certificate for the Borrower and each Loan Party, as at the end of such
month, certified by the chief financial officer or other Responsible
Officer of the Borrower.
(p) OTHER INFORMATION. Such other information respecting the
business, condition (financial or otherwise), operations, performance,
properties or prospects of any Loan Party or any of its Subsidiaries as
any Lender Party (through the Administrative Agent) may from time to
time reasonably request.
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SECTION 5.04. FINANCIAL COVENANTS. So long as any as any
Advance or any other Obligation of any Loan Party under or in respect of any
Loan Document shall remain unpaid, any Letter of Credit shall be outstanding,
any Secured Hedge Agreement shall be in effect or any Lender Party shall have
any Commitment hereunder, the Borrower will:
(a) LEVERAGE RATIO. Maintain on a Consolidated basis for
itself and its Subsidiaries a Leverage Ratio for each Rolling Period
set forth below of not more than the amount set forth below for such
Rolling Period:
ROLLING PERIOD ENDING IN RATIO
------------------------ -----
December, 1999 3.25
March, 2000 3.25
June, 2000 3.00
September, 2000 2.75
December, 2000 2.50
March, 2001 2.50
June, 2001 2.25
September, 2001 2.25
December, 2001 2.00
March, 2002 2.00
June, 2002 2.00
September, 2002 2.00
December, 2002 2.00
March, 2003 2.00
June, 2003 2.00
September, 2003 2.00
December, 2003 2.00
March, 2004 2.00
June, 2004 2.00
September, 2004 2.00
December, 2004 2.00
March, 2005 2.00
June, 2005 2.00
September, 2005 2.00
(b) FIXED CHARGE COVERAGE RATIO. Maintain on a Consolidated
basis for itself and its Subsidiaries a Fixed Charge Coverage Ratio for
each Rolling Period set forth below of not less than the amount set
forth below for such Rolling Period:
65
ROLLING PERIOD ENDING IN RATIO
------------------------ -----
December, 1999 1.50
March, 2000 1.50
June, 2000 1.50
September, 2000 1.50
December, 2000 1.50
March, 2001 1.50
June, 2001 1.50
September, 2001 1.50
December, 2001 1.50
March, 2002 1.50
June, 2002 1.50
September, 2002 1.50
December, 2002 1.50
March, 2003 1.50
June, 2003 1.50
September, 2003 1.50
December, 2003 1.50
March, 2004 1.50
June, 2004 1.50
September, 2004 1.50
December, 2004 1.50
March, 2005 1.50
(c) INTEREST COVERAGE RATIO. Maintain on a Consolidated basis
for itself and its Subsidiaries an Interest Coverage Ratio for each
Rolling Period set forth below of not less than the amount set forth
below for such Rolling Period:
ROLLING PERIOD ENDING IN RATIO
------------------------ -----
December, 1999 4.00
March, 2000 4.00
June, 2000 4.00
September, 2000 4.00
December, 2000 4.00
March, 2001 4.00
June, 2001 4.00
September, 2001 4.00
December, 2001 4.00
March, 2002 4.00
June, 2002 4.00
September, 2002 4.00
December, 2002 4.00
March, 2003 4.00
June, 2003 4.00
September, 2003 4.00
December, 2003 4.00
March, 2004 4.00
June, 2004 4.00
September, 2004 4.00
December, 2004 4.00
March, 2005 4.00
(d) CAPITAL EXPENDITURES. Not make, or permit any of its
Subsidiaries to make, any Capital Expenditures that would cause the
aggregate of all such Capital Expenditures
66
made by the Borrower and its Subsidiaries in any Fiscal Year set forth
below to exceed the amount set forth below for such Fiscal Year:
FISCAL YEAR AMOUNT
----------- ------
2000 $4,550
2001 $4,550
2002 $5,050
2003 $5,350
2004 $5,350
2005 $5,350
provided, however, that from the date of the Initial Extension of Credit until
December 31, 1999, such amount shall not exceed $1,000,000; provided further,
however, that if, at the end of any Fiscal Year set forth above, the amount
specified above for such Fiscal Year exceeds the amount of Capital Expenditures
made by the Borrower and its Subsidiaries during such Fiscal Year (the amount of
such excess being the "EXCESS AMOUNT"), the Borrower and its Subsidiaries shall
be entitled to make additional Capital Expenditures in the succeeding Fiscal
Year in an amount (such amount being referred to herein as the "CARRYOVER
AMOUNT") equal to the lesser of (i) the Excess Amount and (ii) 50% of the amount
specified above for such prior Fiscal Year.
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following events
("EVENTS OF DEFAULT") shall occur and be continuing:
(a) (i) the Borrower shall fail to pay any principal of any
Advance when the same becomes due and payable, or (ii) the Borrower
shall fail to pay any interest on any Advance or any Loan Party shall
fail or make any other payment under any Loan Document in each case
within two Business Days of when the same becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan Document
shall prove to have been incorrect in any material respect when made;
or
(c) any Loan Party shall fail to perform or observe any term,
covenant or agreement contained in Xxxxxxx 0.00, 0.00(x), (x), (x),
(x), (x), (o) or (p), 5.02, 5.03 or 5.04; or
(d) any Loan Party shall fail to perform or observe any other
term, covenant or agreement contained in any Loan Document on its part
to be performed or observed if such failure shall remain unremedied for
30 days after the earlier of the date on which (A) a Responsible
Officer of the Borrower becomes aware of such failure or (B) written
notice thereof shall have been given to the Borrower by the
Administrative Agent or any Lender Party; or
(e) any Loan Party or any of its Material Subsidiaries shall
fail to pay any principal of, premium or interest on or any other
amount payable in respect of any Debt of such Loan Party or such
Subsidiary (as the case may be) that is outstanding in a principal
amount (or, in the case of any Hedge Agreement, an Agreement Value) of
at least $500,000 either individually or in the aggregate (but
excluding Debt outstanding hereunder) of such Loan Party or such
Subsidiary (as the case may be), when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or
instrument relating to such Debt; or any other event shall occur or
condition
67
shall exist under any agreement or instrument relating to any
such Debt and shall continue after the applicable grace period, if any,
specified in such agreement or instrument, if the effect of such event
or condition is to accelerate, or to permit the acceleration of, the
maturity of such Debt or otherwise to cause, or to permit the holder
thereof to cause, such Debt to mature; or any such Debt shall be
declared to be due and payable or required to be prepaid or redeemed
(other than by a regularly scheduled required prepayment or
redemption), purchased or defeased, or an offer to prepay, redeem,
purchase or defease such Debt shall be required to be made, in each
case prior to the stated maturity thereof; or
(f) any Loan Party or any of its Material Subsidiaries shall
generally not pay its debts as such debts become due, or shall admit in
writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of creditors; or any proceeding
shall be instituted by or against any Loan Party or any of its
Subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement,
adjustment, protection, relief, or composition of it or its debts under
any law relating to bankruptcy, insolvency or reorganization or relief
of debtors, or seeking the entry of an order for relief or the
appointment of a receiver, trustee, or other similar official for it or
for any substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such proceeding
shall remain undismissed or unstayed for a period of 45 days or any of
the actions sought in such proceeding (including, without limitation,
the entry of an order for relief against, or the appointment of a
receiver, trustee, custodian or other similar official for, it or any
substantial part of its property) shall occur; or any Loan Party or any
of its Subsidiaries shall take any corporate action to authorize any of
the actions set forth above in this subsection (f); or
(g) any judgments or orders, either individually or in the
aggregate, for the payment of money in excess of $500,000 (to the
extent not fully paid or discharged) shall be rendered against any Loan
Party or any of its Subsidiaries and either (i) enforcement proceedings
shall have been commenced by any creditor upon such judgment or order
or (ii) there shall be any period of 30 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect; or
(h) any non-monetary judgment or order shall be rendered
against any Loan Party or any of its Subsidiaries that could reasonably
be likely to have a Material Adverse Effect, and there shall be any
period of 30 consecutive days during which a stay of enforcement of
such judgment or order, by reason of a pending appeal or otherwise,
shall not be in effect; or
(i) any provision of any Loan Document, after delivery thereof
pursuant to Section 3.01 or 5.01(j) or (k), shall for any reason cease
to be valid and binding on or enforceable against any Loan Party to it,
or any such Loan Party shall so state in writing; or
(j) any Collateral Document or financing statement, after
delivery thereof pursuant to Section 3.01 or 5.01(j) or (k), shall for
any reason (other than pursuant to the terms thereof or subject to the
Permitted Liens) cease to create a valid and perfected first priority
lien on and security interest in the Collateral purported to be covered
thereby; or
(k) a Change of Control shall occur; or
(l) any ERISA Event shall have occurred with respect to a Plan
and the sum (determined as of the date of occurrence of such ERISA
Event) of the Insufficiency of such Plan and the Insufficiency of any
and all other Plans with respect to which an ERISA Event shall have
occurred and then exist (or the liability of the Loan Parties and the
ERISA Affiliates related to such ERISA Event) exceeds $500,000; or
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(m) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan in an amount that, when
aggregated with all other amounts required to be paid to Multiemployer
Plans by the Loan Parties and the ERISA Affiliates as Withdrawal
Liability (determined as of the date of such notification), exceeds
$500,000 or requires payments exceeding $50,000 per annum; or
(n) any Loan Party or any ERISA Affiliate shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer
Plan is in reorganization or is being terminated, within the meaning of
Title IV of ERISA, and as a result of such reorganization or
termination the aggregate annual contributions of the Loan Parties and
the ERISA Affiliates to all Multiemployer Plans that are then in
reorganization or being terminated have been or will be increased over
the amounts contributed to such Multiemployer Plans for the plan years
of such Multiemployer Plans immediately preceding the plan year in
which such reorganization or termination occurs by an amount exceeding
$50,000; or
(o) there shall be reasonably likely to occur any Material
Adverse Change;
then, and in any such event, the Administrative Agent (i) shall at the request,
or may with the consent, of the Required Lenders, by notice to the Borrower,
declare the Commitments of each Lender Party and the obligation of each Lender
to make Advances (other than Letter of Credit Advances by the Issuing Bank or a
Working Capital Lender pursuant to Section 2.03(c) and Swing Line Advances by a
Working Capital Lender pursuant to Section 2.02(b)) and of the Issuing Bank to
issue Letters of Credit to be terminated, whereupon the same shall forthwith
terminate, and (ii) shall at the request, or may with the consent, of the
Required Lenders, by notice to the Borrower, declare the Advances, all interest
thereon and all other amounts payable under this Agreement, the Notes, if any,
and the other Loan Documents to be forthwith due and payable, whereupon the
Advances, all such interest and all such amounts shall become and be forthwith
due and payable, without presentment, demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Borrower, provided,
however, that, in the event of an actual or deemed entry of an order for relief
with respect to any Loan Party or any of its Subsidiaries under the Federal
Bankruptcy Code, (x) the Commitments of each Lender Party and the obligation of
each Lender to make Advances (other than Letter of Credit Advances by the
Issuing Bank or a Working Capital Lender pursuant to Section 2.03(c) and Swing
Line Advances by a Working Capital Lender pursuant to Section 2.02(b)) and of
the Issuing Bank to issue Letters of Credit shall automatically be terminated
and (y) the Advances, all such interest and all such amounts shall automatically
become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the Borrower.
SECTION 6.02. ACTIONS IN RESPECT OF THE LETTERS OF CREDIT UPON
DEFAULT. If any Event of Default shall have occurred and be continuing, the
Administrative Agent shall at the request, or may with the consent, of the
Required Lenders, irrespective of whether it is taking any of the actions
described in Section 6.01 or otherwise, make demand upon the Borrower to, and
forthwith upon such demand the Borrower will, pay to the Administrative Agent on
behalf of the Lender Parties in same day funds at the Administrative Agent's
office designated in such demand, for deposit in the L/C Cash Collateral
Account, an amount equal to the aggregate Available Amount of all Letters of
Credit then outstanding. If at any time the Administrative Agent determines in
good faith that any funds held in the L/C Cash Collateral Account are subject to
any right or claim of any Person other than the Administrative Agent and the
Lender Parties or that the total amount of such funds is less than the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Administrative Agent provided together with reasonable details of
such right or claim, pay to the Administrative Agent, as additional funds to be
deposited and held in the L/C Cash Collateral Account, an amount equal to the
excess of (a) such aggregate Available Amount over (b) the total amount of
funds, if any, then held in the L/C Cash Collateral Account that the
Administrative Agent determines to be free and clear of any such right and
claim. Upon the drawing
69
of any Letter of Credit for which funds are on deposit in the L/C Cash
Collateral Account, such funds shall be applied to reimburse the Issuing Bank or
Working Capital Lenders, as applicable, to the extent permitted by applicable
law.
ARTICLE VII
THE AGENTS
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender Party (in
its capacities as a Lender and the Swing Line Bank and the Issuing Bank (if
applicable) and a potential Hedge Bank) hereby appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to exercise
such powers and discretion under this Agreement and the other Loan Documents as
are delegated to the Administrative Agent by the terms hereof and thereof,
together with such powers and discretion as are reasonably incidental thereto.
As to any matters not expressly provided for by the Loan Documents (including,
without limitation, enforcement or collection of the Debt resulting from the
Advances), 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 upon all Lender Parties and all holders of Notes; 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
this Agreement or applicable law. The Administrative Agent agrees to give to
each Lender Party prompt notice of each notice given to it by the Borrower
pursuant to the terms of this Agreement.
SECTION 7.02. AGENTS' RELIANCE, ETC. No Agent nor any of its
directors, officers, agents or employees shall be liable for any action taken or
omitted to be taken by it or them under or in connection with the Loan
Documents, except for its or their own gross negligence or willful misconduct.
Without limitation of the generality of the foregoing, the Agents: (a) may treat
the Lender that made any Advance as the holder of the Debt resulting therefrom
until such Agent receives and accepts an Assignment and Acceptance entered into
by such Lender, as assignor, and an Eligible Assignee, as assignee, as provided
in Section 8.07; (b) may consult with legal counsel (including counsel for any
Loan Party), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts; (c)
makes no warranty or representation to any Lender Party and shall not be
responsible to any Lender Party for any statements, warranties or
representations (whether written or oral) made in or in connection with the Loan
Documents; (d) shall not have any duty to ascertain or to inquire as to the
performance or observance of any of the terms, covenants or conditions of any
Loan Document on the part of any Loan Party or to inspect the property
(including the books and records) of any Loan Party; (e) shall not be
responsible to any Lender Party for the due execution, legality, validity,
enforceability, genuineness, sufficiency or value of, or the perfection or
priority of any lien or security interest created or purported to be created
under or in connection with, any Loan Document or any other instrument or
document furnished pursuant thereto; and (f) shall incur no liability under or
in respect of any Loan Document by acting upon any notice, consent, certificate
or other instrument or writing (which may be by telegram, telecopy or telex)
believed by it to be genuine and signed or sent by the proper party or parties.
SECTION 7.03. BNP AND AFFILIATES. With respect to its
Commitments, the Advances made by it and any Notes issued to it, BNP shall have
the same rights and powers under the Loan Documents as any other Lender Party
and may exercise the same as though it were not an Agent; and the term "Lender
Party" or "Lenders Parties" shall, unless otherwise expressly indicated, include
BNP in its individual capacity. BNP and its affiliates may accept deposits from,
lend money to, act as trustee under indentures of, accept investment banking
engagements from and generally engage in any kind of business with, any Loan
Party, any of its Subsidiaries and any Person who may do business with or own
securities of any Loan Party or any such Subsidiary, all as if BNP were not an
Agent and without any duty to account therefor to the Lender Parties.
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SECTION 7.04. LENDER PARTY CREDIT DECISION. Each Lender Party
acknowledges that it has, independently and without reliance upon any Agent or
any other Lender Party and based on the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement. Each Lender Party also acknowledges that it will, independently and
without reliance upon any Agent or any other Lender Party and based on such
documents and information as it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under this
Agreement.
SECTION 7.05. INDEMNIFICATION. (a) Each Lender Party severally
agrees to indemnify each Agent (to the extent not promptly reimbursed by the
Borrower) from and against such Lender Party's ratable share (determined as
provided below) of any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind or nature whatsoever (including, without limitation, reasonable fees and
expenses of counsel) that may be imposed on, incurred by, or asserted against
such Agent in any way relating to or arising out of the Loan Documents or any
action taken or omitted by such Agent under the Loan Documents; provided,
however, that no Lender Party shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from such Agent's gross negligence or
willful misconduct as found in a final, non-appealable judgment by a court of
competent jurisdiction. Without limitation of the foregoing, each Lender Party
agrees to reimburse such Agent promptly upon demand for its ratable share of any
costs and expenses (including, without limitation, fees and expenses of counsel)
payable by the Borrower under Section 8.04, to the extent that such Agent is not
promptly reimbursed for such costs and expenses by the Borrower.
(b) Each Lender severally agrees to indemnify the Issuing Bank
(to the extent not promptly reimbursed by the Borrower) from and against such
Lender's ratable share (determined as provided below) of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against the Issuing Bank in any way
relating to or arising out of the Loan Documents or any action taken or omitted
by the Issuing Bank under the Loan Documents; provided, however, that no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
resulting from the Issuing Bank's gross negligence or willful misconduct as
found in a final, non-appealable judgment by a court of competent jurisdiction.
Without limitation of the foregoing, each Lender agrees to reimburse the Issuing
Bank promptly upon demand for its ratable share of any costs and expenses
(including, without limitation, fees and expenses of counsel) payable by the
Borrower under Section 8.04, to the extent that the Issuing Bank is not promptly
reimbursed for such costs and expenses by the Borrower.
(c) For purposes of this Section 7.05, the Lender Parties'
respective ratable shares of any amount shall be determined, at any time,
according to the sum of (i) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective Lender Parties, (ii) their
respective Pro Rata Shares of the aggregate Available Amount of all Letters of
Credit outstanding at such time, (iii) the aggregate unused portions of their
respective Term Commitments at such time and (iv) their respective Unused
Working Capital Commitments at such time; provided that the aggregate principal
amount of Swing Line Advances owing to the Swing Line Bank and of Letter of
Credit Advances owing to the Issuing Bank shall be considered to be owed to the
Working Capital Lenders ratably in accordance with their respective Working
Capital Commitments at such time. In the case of any investigation, litigation
or proceeding giving rise to any Indemnified Costs, this Section 7.05 applies
whether any such investigation, litigation or proceeding is brought by any
Agent, any Lender, any other Lender Party or a third party. The failure of any
Lender Party to reimburse any Agent or the Issuing Bank, as the case may be,
promptly upon demand for its ratable share of any amount required to be paid by
the Lender Parties to any Agent or the Issuing Bank, as the case may be, as
provided herein shall not relieve any other Lender Party of
71
its obligation hereunder to reimburse any Agent or the Issuing Bank, as the
case may be, for its ratable share of such amount, but no Lender Party shall
be responsible for the failure of any other Lender Party to reimburse any Agent
or the Issuing Bank, as the case may be, for such other Lender Party's ratable
share of such amount. Without prejudice to the survival of any other agreement
of any Lender Party hereunder, the agreement and obligations of each Lender
Party contained in this Section 7.05 shall survive the payment in full of
principal, interest and all other amounts payable hereunder and under the other
Loan Documents.
SECTION 7.06. SUCCESSOR AGENTS. Any Agent may resign as to any
or all of the Facilities at any time by giving written notice thereof to the
Lender Parties and the Borrower and may be removed at any time with or without
cause by the Required Lenders. Upon any such resignation or removal, the
Required Lenders shall have the right to appoint a successor Agent as to such of
the Facilities as to which such Agent has resigned or been removed; provided,
however, that, absent an Event of Default, the consent of the Borrower shall be
required, such consent not to be unreasonably withheld. If no successor Agent
shall have been so appointed by the Required Lenders, and shall have accepted
such appointment, within 30 days after the retiring Agent's giving of notice of
resignation or the Required Lenders' removal of the retiring Agent, then the
retiring Agent may, on behalf of the Lender Parties, appoint a successor Agent,
which shall be a commercial bank organized under the laws of the United States
or of any State thereof and having a combined capital and surplus of at least
$250,000,000; provided, however, that, absent an Event of Default, the consent
of the Borrower shall be required, such consent not to be unreasonably withheld.
Upon the acceptance of any appointment as Agent hereunder by a successor Agent
and upon the execution and filing or recording of such financing statements, or
amendments thereto and such other instruments or notices, as may be necessary or
desirable, or as the Required Lenders may request, in order to continue the
perfection of the Liens granted or purported to be granted by the Collateral
Documents, such successor Agent shall succeed to and become vested with all the
rights, powers, discretion, privileges and duties of the retiring Agent, and the
retiring Agent shall be discharged from its duties and obligations under the
Loan Documents. If within 45 days after written notice is given of the retiring
Agent's resignation or removal under this Section 7.06 no successor Agent shall
have been appointed and shall have accepted such appointment, then on such 45th
day (i) the retiring Agent's resignation or removal shall become effective, (ii)
the retiring Agent shall thereupon be discharged from its duties and obligations
under the Loan Documents and (iii) the Required Lenders shall thereafter perform
all duties of the retiring Agent under the Loan Documents until such time, if
any, as the Required Lenders appoint a successor Agent as provided above. After
any retiring Agent's resignation or removal hereunder as Agent shall become
effective, the provisions of this Article VII shall inure to its benefit as to
any actions taken or omitted to be taken by it while it was Agent under this
Agreement and the other Loan Documents.
SECTION 7.07. AGENTS AND ARRANGERS. No Agent or any Arranger
shall have duties except as specifically provided by this Agreement and the
other Loan Documents.
SECTION 7.08. ADDITIONAL AGENTS. The Administrative Agent, in
its sole discretion, may appoint a Documentation Agent, Syndication Agent or
other Agent under this Agreement; provided, however, that no such Agent shall
have any duties under this Agreement and the other Loan Documents.
72
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or any Notes or any other Loan Document, nor consent
to any departure by the Borrower or any other Loan Party therefrom, shall in any
event be effective unless the same shall be in writing and signed (or, in the
case of the Collateral Documents, consented to) by the Required Lenders, and
then such waiver or consent shall be effective only in the specific instance and
for the specific purpose for which given; provided, however, that (a) no
amendment, waiver or consent shall, unless in writing and signed by all of the
Lenders, do any of the following at any time: (i) waive any of the conditions
specified in Section 3.01 or, in the case of the Initial Extension of Credit,
Section 3.02, (ii) change the percentage of (x) the Commitments, (y) the
aggregate unpaid principal amount of the Advances or (z) the aggregate Available
Amount of outstanding Letters of Credit that, in each case, shall be required
for the Lenders or any of them to take any action hereunder, (iii) release all
or substantially all of the Collateral in any transaction or series of related
transactions or permit the creation, incurrence, assumption or existence of any
Lien on all or substantially all of the Collateral in any transaction or series
of related transactions to secure any Obligations other than Obligations owing
to the Secured Parties under the Loan Documents or (iv) amend this Section 8.01
and (b) no amendment, waiver or consent shall, unless in writing and signed by
the Required Lenders and each Lender that has a Commitment under the Term A
Facility or Working Capital Facility and that is directly affected by such
amendment, waiver or consent, (i) increase the Commitments of such Lender or
amend Section 2.13 so as to subject such Lender to additional Obligations, (ii)
reduce the principal of, or interest on, the Advances payable to such Lender or
any fees or other amounts payable to such Lender, (iii) postpone any date
scheduled for any payment of principal of, or interest on, the Advances payable
to such Lender pursuant to Section 2.04 or Section 2.07 or any date fixed for
payment of fees or other amounts payable to such Lender or (v) change the order
of application of any prepayment set forth in Section 2.06 in any manner that
materially adversely affects such Lender; provided further that no amendment,
waiver or consent shall, unless in writing and signed by the Swing Line Bank or
the Issuing Bank, as the case may be, in addition to the Lenders required above
to take such action, affect the rights or obligations of the Swing Line Bank or
the Issuing Bank, as the case may be, under this Agreement; and provided further
that no amendment, waiver or consent shall, unless in writing and signed by each
affected Agent in addition to the Lenders required above to take such action,
affect the rights or duties of such Agent under this Agreement or the other Loan
Documents.
SECTION 8.02. NOTICES, ETC. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy or telex communication) and mailed, telegraphed,
telecopied, telexed or delivered by an overnight courier of nationally
recognized standing, if to the Borrower or any other Loan Party, at the address
of the Borrower at 000 Xxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000,
Attention: Chief Financial Officer, telecopier number (000) 000-0000; if to any
Initial Lender or any Initial Issuing Bank, at its Domestic Lending Office
specified opposite its name on Schedule I hereto; if to any other Lender Party,
at its Domestic Lending Office specified in the Assignment and Acceptance
pursuant to which it became a Lender Party; and if to the Administrative Agent,
at its address at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Leveraged Finance Group, telecopier number (000) 000-0000; or, as to each party,
at such other address as shall be designated by such party in a written notice
to the other parties. All such notices and communications shall, when mailed,
telegraphed, telecopied, telexed or sent by courier, be effective when deposited
in the mails, delivered to the telegraph company, transmitted by telecopier,
confirmed by telex answerback or delivered to the overnight courier,
respectively, except that notices and communications to any Agent pursuant to
Article II, III or VIII shall not be effective until received by such Agent.
Delivery by telecopier of an executed counterpart of any amendment or waiver of
any provision of this Agreement or the Notes or of any Exhibit hereto to be
executed and delivered hereunder shall be effective as delivery of a manually
executed counterpart thereof.
73
SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of
any Lender Party or any Agent to exercise, and no delay in exercising, any right
hereunder or under any Note shall operate as a waiver thereof; nor shall any
single or partial exercise of any such right preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any remedies provided by law.
SECTION 8.04. COSTS AND EXPENSES. (a) The Borrower agrees to
pay on demand (i) all costs and expenses of the Administrative Agent in
connection with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents (including, without limitation,
(A) all due diligence, collateral review, syndication, transportation, computer,
duplication, appraisal, audit, insurance, consultant, search, filing and
recording fees and expenses and (B) the reasonable fees and expenses of counsel
for the Administrative Agent with respect thereto, with respect to advising the
Administrative Agent as to its rights and responsibilities, or the perfection,
protection or preservation of rights or interests, under the Loan Documents,
with respect to negotiations with any Loan Party or with other creditors of any
Loan Party or any of its Subsidiaries arising out of any Default or any events
or circumstances that may give rise to a Default and with respect to presenting
claims in or otherwise participating in or monitoring any bankruptcy, insolvency
or other similar proceeding involving creditors' rights generally and any
proceeding ancillary thereto) and (ii) all costs and expenses of the Agents and
the Lender Parties in connection with the enforcement of the Loan Documents,
whether in any action, suit or litigation, any bankruptcy, insolvency or other
similar proceeding affecting creditors' rights generally (including, without
limitation, the reasonable fees and expenses of counsel for the Administrative
Agent and each Lender Party with respect thereto).
(b) The Borrower agrees to indemnify, defend and save and hold
harmless each Agent, each Lender Party and each of their Affiliates and their
officers, directors, employees, agents and advisors (each, an "INDEMNIFIED
PARTY") from and against any and all claims, damages, losses, liabilities and
expenses (including, without limitation, reasonable fees and expenses of
counsel) that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or by reason of
(including, without limitation, in connection with any investigation, litigation
or proceeding or preparation of a defense in connection therewith) (i) the
Facilities, the actual or proposed use of the proceeds of the Advances or the
Letters of Credit, the Loan Documents or any of the transactions contemplated
thereby, or (ii) the actual or alleged presence of Hazardous Materials on any
property of any Loan Party or any of its Subsidiaries or any Environmental
Action relating in any way to any Loan Party or any of its Subsidiaries, except
to the extent such claim, damage, loss, liability or expense is found in a
final, non-appealable judgment by a court of competent jurisdiction to have
resulted from such Indemnified Party's gross negligence or willful misconduct.
In the case of an investigation, litigation or other proceeding to which the
indemnity in this Section 8.04(b) applies, such indemnity shall be effective
whether or not such investigation, litigation or proceeding is brought by any
Loan Party, its directors, shareholders or creditors or an Indemnified Party,
whether or not any Indemnified Party is otherwise a party thereto and whether or
not the Transaction is consummated. The Borrower also agrees not to assert any
claim against any Agent, any Lender Party or any of their Affiliates, or any of
their respective officers, directors, employees, agents and advisors, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of or otherwise relating to the Facilities, the actual or proposed
use of the proceeds of the Advances or the Letters of Credit, the Loan Documents
or any of the transactions contemplated thereby.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender Party other than on the last day of the Interest Period for such Advance,
as a result of an assignment in connection with a syndication contemplated by
Section 2.02(c), a payment or Conversion pursuant to Section 2.06, 2.09(b)(i) or
2.10(d), acceleration of the maturity of the Advances pursuant to Section 6.01
or for any other reason or by an Eligible Assignee to a Lender Party other than
on the last day of the Interest Period for such Advance upon an assignment of
rights and obligations under this Agreement pursuant to Section 8.07 as a result
of a demand by the Borrower pursuant to Section 8.07(a), the Borrower shall,
upon demand by such Lender Party, together with the provision of reasonable
detail of the underlying
74
circumstances (with a copy of such demand and details to the Administrative
Agent), pay to the Administrative Agent for the account of such Lender
Party any amounts required to compensate such Lender Party for any
additional losses, costs or expenses that it may reasonably incur as a result of
such payment, including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the liquidation or
reemployment of deposits or other funds acquired by any Lender Party to fund or
maintain such Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
may be paid on behalf of such Loan Party by the Administrative Agent or any
Lender Party, in its sole discretion.
(e) Without prejudice to the survival of any other agreement
of any Loan Party hereunder or under any other Loan Document, the agreements and
obligations of the Borrower contained in Sections 2.10 and 2.12 and this Section
8.04 shall survive the payment in full of principal, interest and all other
amounts payable hereunder and under any of the other Loan Documents.
SECTION 8.05. RIGHT OF SET-OFF. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the
Administrative Agent to declare the Advances due and payable pursuant to the
provisions of Section 6.01, each Lender Party and each of its respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender Party or such
Affiliate to or for the credit or the account of the Borrower against any and
all of the Obligations of the Borrower now or hereafter existing under this
Agreement and the Note or Notes (if any) held by such Lender Party, irrespective
of whether such Lender Party shall have made any demand under this Agreement or
such Note or Notes and although such Obligations may be unmatured. Each Agent
and each Lender Party agrees promptly to notify the Borrower after any such
set-off and application; 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 Party and its respective Affiliates under this Section are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) that such Lender Party and its respective Affiliates may
have.
SECTION 8.06. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by the Borrower and the
Administrative Agent and when the Administrative Agent shall have been notified
by each Initial Lender and the Initial Issuing Bank that such Initial Lender and
the Initial Issuing Bank has executed it and thereafter shall be binding upon
and inure to the benefit of the Borrower, the Administrative Agent and each
Lender Party and their respective successors and assigns, except that the
Borrower shall not have the right to assign its rights hereunder or any interest
herein without the prior written consent of the Lender Parties.
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender
may and, so long as no Default has occurred and is continuing, if demanded by
the Borrower upon at least 5 Business Days' notice to such Lender and the
Administrative Agent, assign to one or more Eligible Assignees all or a portion
of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment or Commitments, the Advances
owing to it and any Note or Notes held by it); provided, however, that (i) each
such assignment shall be of a uniform, and not a varying, percentage of all
rights and obligations under and in respect of one or more Facilities, (ii)
except in the case of an assignment to a Person that, immediately prior to such
assignment, was a Lender, an Affiliate of any Lender or an Approved Fund of any
Lender or an assignment of all of a Lender's rights and obligations under this
Agreement, the aggregate amount of the Commitments being assigned to such
Eligible Assignee pursuant to such assignment (determined as of the date of the
Assignment and Acceptance with respect to such assignment) shall in no event be
less than $5,000,000 (or such lesser amount as shall be approved by the Borrower
and the Administrative
75
Agent) and shall be in an integral multiple of $500,000, (iii) each such
assignment shall be to an Eligible Assignee, (iv) each such assignment made as a
result of a demand by the Borrower pursuant to this Section 8.07(a) shall be
arranged by the Borrower after consultation with the Administrative Agent and
shall be either an assignment of all of the rights and obligations of the
assigning Lender under this Agreement or an assignment of a portion of such
rights and obligations made concurrently with another such assignment or other
such assignments that together cover all of the rights and obligations of the
assigning Lender under this Agreement, (v) no Lender shall be obligated to make
any such assignment as a result of a demand by the Borrower pursuant to this
Section 8.07(a) unless and until such Lender shall have received one or more
payments from either the Borrower or one or more Eligible Assignees in an
aggregate amount at least equal to the aggregate outstanding principal amount of
the Advances owing to such Lender, together with accrued interest thereon to the
date of payment of such principal amount and all other amounts payable to such
Lender under this Agreement, (vi) no such assignments shall be permitted without
the consent of the Administrative Agent until the Administrative Agent shall
have notified the Lender Parties that syndication of the Commitments hereunder
has been completed, and (vii) the parties to each such assignment shall execute
and deliver to the Administrative Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance, together with any Note or Notes subject
to such assignment and a processing and recordation fee of $3,500.
(b) Upon such execution, delivery, acceptance and recording,
from and after the effective date specified in such Assignment and Acceptance,
(x) the assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, have the rights and obligations of a Lender or
Issuing Bank, as the case may be, hereunder and (y) the Lender or Issuing Bank
assignor thereunder shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this Agreement (and, in
the case of an Assignment and Acceptance covering all or the remaining portion
of an assigning Lender's or Issuing Bank's rights and obligations under this
Agreement, such Lender or Issuing Bank shall cease to be a party hereto).
(c) By executing and delivering an Assignment and Acceptance,
each Lender Party assignor thereunder and each assignee thereunder confirm to
and agree with each other and the other parties thereto and hereto as follows:
(i) other than as provided in such Assignment and Acceptance, such assigning
Lender Party makes no representation or warranty and assumes no responsibility
with respect to any statements, warranties or representations made in or in
connection with this Agreement or any other Loan Document or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of, or the
perfection or priority of any lien or security interest created or purported to
be created under or in connection with, this Agreement or any other Loan
Document or any other instrument or document furnished pursuant hereto or
thereto; (ii) such assigning Lender Party makes no representation or warranty
and assumes no responsibility with respect to the financial condition of the
Borrower or any other Loan Party or the performance or observance by any Loan
Party of any of its obligations under any Loan Document or any other instrument
or document furnished pursuant thereto; (iii) such assignee confirms that it has
received a copy of this Agreement, together with copies of the financial
statements referred to in Section 4.01 and such other documents and information
as it has deemed appropriate to make its own credit analysis and decision to
enter into such Assignment and Acceptance; (iv) such assignee will,
independently and without reliance upon the Administrative Agent, such assigning
Lender Party or any other Lender Party and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under this Agreement; (v) such
assignee confirms that it is an Eligible Assignee; (vi) such assignee appoints
and authorizes the Administrative Agent to take such action as agent on its
behalf and to exercise such powers and discretion under the Loan Documents as
are delegated to the Administrative Agent by the terms hereof, together with
such powers and discretion as are reasonably incidental thereto; and (vii) such
assignee agrees that it will perform in accordance with their terms all of the
obligations which by the terms of this Agreement are required to be performed by
it as a Lender or Issuing Bank, as the case may be.
76
(d) The Administrative Agent shall maintain at its address
referred to in Section 8.02 a copy of each Assignment and Acceptance delivered
to and accepted by it and a register for the recordation of the names and
addresses of the Lender Parties and the Commitment under each Facility of, and
principal amount of the Advances owing under each Facility to, each Lender Party
from time to time (the "REGISTER"). The entries in the Register shall be
conclusive and binding for all purposes, absent manifest error, and the
Borrower, the Administrative Agent and the Lender Parties may treat each Person
whose name is recorded in the Register as a Lender Party hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower or any Lender Party at any reasonable time and from time to time
upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender Party and an assignee, together with any Note or Notes
requested by the Assignee subject to such assignment, the Administrative Agent
shall, if such Assignment and Acceptance has been completed and is in
substantially the form of Exhibit C hereto, (i) accept such Assignment and
Acceptance, (ii) record the information contained therein in the Register and
(iii) give prompt notice thereof to the Borrower.
(f) Each Lender Party may sell participations in or to all or
a portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitments, the Advances owing to it and
any Note or Notes held by it) to any Person other than any Loan Party or any of
its Subsidiaries or Affiliates; provided, however, that (i) such Lender Party's
obligations under this Agreement (including, without limitation, its
Commitments) shall remain unchanged, (ii) such Lender Party shall remain solely
responsible to the other parties hereto for the performance of such obligations,
(iii) such Lender Party shall remain the holder of such Advances and any such
Note for all purposes of this Agreement, (iv) the Borrower, each Agent and the
other Lender Parties shall continue to deal solely and directly with such Lender
Party in connection with such Lender Party's rights and obligations under this
Agreement and (v) no participant under any such participation shall have any
right to approve any amendment or waiver of any provision of any Loan Document,
or any consent to any departure by any Loan Party therefrom, except to the
extent that such amendment, waiver or consent would reduce the principal of, or
interest on, the Advances or any fees or other amounts payable hereunder, in
each case to the extent subject to such participation, postpone any date fixed
for any payment of principal of, or interest on, the Advances or any fees or
other amounts payable hereunder, in each case to the extent subject to such
participation, or release all or substantially all of the Collateral.
(g) Any Lender Party may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower furnished to such Lender
Party by or on behalf of the Borrower; provided, however, that such disclosure
shall be on a confidential basis.
(h) Notwithstanding any other provision set forth in this
Agreement, any Lender Party may at any time create a security interest in all or
any portion of its rights under this Agreement (including, without limitation,
the Advances owing to it and any Note or Notes held by it) in favor of any
Federal Reserve Bank in accordance with Regulation A of the Board of Governors
of the Federal Reserve System.
SECTION 8.08. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of an original executed
counterpart of this Agreement.
77
SECTION 8.09. NO LIABILITY OF THE ISSUING BANK. The Borrower
assumes all risks of the acts or omissions of any beneficiary or transferee of
any Letter of Credit with respect to its use of such Letter of Credit. Neither
the Issuing Bank nor any of its officers or directors shall be liable or
responsible for: (a) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection therewith; (b)
the validity, sufficiency or genuineness of documents, or of any endorsement
thereon, even if such documents should prove to be in any or all respects
invalid, insufficient, fraudulent or forged; (c) payment by the Issuing Bank
against presentation of documents that do not comply with the terms of a Letter
of Credit, including failure of any documents to bear any reference or adequate
reference to the Letter of Credit; or (d) any other circumstances whatsoever in
making or failing to make payment under any Letter of Credit, except that the
Borrower shall have a claim against the Issuing Bank, and the Issuing Bank shall
be liable to the Borrower, to the extent of any direct, but not consequential,
damages suffered by the Borrower that the Borrower proves were caused by (i) the
Issuing Bank's willful misconduct or gross negligence as determined in a final,
non-appealable judgment by a court of competent jurisdiction in determining
whether documents presented under any Letter of Credit comply with the terms of
the Letter of Credit or (ii) the Issuing Bank's willful failure to make lawful
payment under a Letter of Credit after the presentation to it of a draft and
certificates strictly complying with the terms and conditions of the Letter of
Credit. In furtherance and not in limitation of the foregoing, the Issuing Bank
may accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary.
SECTION 8.10. JURISDICTION, ETC. (a) Each of the parties
hereto hereby irrevocably and unconditionally submits, for itself and its
property, to the nonexclusive jurisdiction of any New York State court or
federal court of the United States of America sitting in New York City, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Agreement or any of the other Loan Documents to which it is a
party, or for recognition or enforcement of any judgment, and each of the
parties hereto hereby irrevocably and unconditionally agrees that all claims in
respect of any such action or proceeding may be heard and determined in any such
New York State court or, to the extent permitted by law, in such federal court.
Each of the parties hereto agrees that a final judgment in any such action or
proceeding shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by law. Nothing in this
Agreement shall affect any right that any party may otherwise have to bring any
action or proceeding relating to this Agreement or any of the other Loan
Documents in the courts of any jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Loan Documents to which it is a party in any New York State or federal
court. Each of the parties hereto hereby irrevocably waives, to the fullest
extent permitted by law, the defense of an inconvenient forum to the maintenance
of such action or proceeding in any such court.
SECTION 8.11. GOVERNING LAW. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State
of New York.
SECTION 8.12. JUDGMENT AND CURRENCY DETERMINATION. (a) If, for
the purpose of obtaining judgment in any court, or making any determinations
under the Loan Documents (including Section 5.02(f)(i)(y)), it is necessary to
convert a sum due hereunder or under any other Loan Document in another currency
into Dollars, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which, in
accordance with normal banking procedures, the Administrative Agent could
purchase such other currency with Dollars in New York City, New York, at the
close of business on the Business Day immediately preceding the day on which
final judgment is given, together with any premiums and costs of exchange
payable in connection with such purchase.
78
(b) The obligation of the Borrower in respect of any sum due
from it to the Administrative Agent or any Lender hereunder or under any other
Loan Document shall, notwithstanding any judgment in a currency other than
Dollars, be discharged only to the extent that on the Business Day next
succeeding receipt by the Administrative Agent or such Lender of any sum
adjudged to be so due in such other currency, the Administrative Agent or such
Lender, as the case may be, may, in accordance with normal banking procedures,
purchase Dollars with such other currency. If the Dollars so purchased are less
than the sum originally due to the Administrative Agent or such Lender in
Dollars, the Borrower agrees, as a separate obligation and notwithstanding any
such judgment, to indemnify the Administrative Agent or such Lender against such
loss, and if the Dollars so purchased exceed the sum originally due to the
Administrative Agent or any Lender in Dollars, the Administrative Agent or such
Lender agrees to remit to such Borrower such excess.
SECTION 8.13. WAIVER OF JURY TRIAL. Each of the Loan Parties,
each Agent and the Lender Parties irrevocably waives all right to trial by jury
in any action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to any of the Loan Documents, the
Advances, the Letters of Credit or the actions of any Agent or any Lender Party
in the negotiation, administration, performance or enforcement thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
SAFETY 1st, INC.
By _______________________________
Title:
BANQUE NATIONALE DE PARIS,
as Administrative Agent, Swing
Line Bank, Initial Issuing Bank
and Initial Lender
By _______________________________
Title:
By _______________________________
Title:
ADDITIONAL INITIAL LENDERS
UNION BANK OF CALIFORNIA, N.A.
as Syndication Agent
By _______________________________
Title:
LASALLE BANK NATIONAL ASSOCIATION,
as Documentation Agent
By _______________________________
Title:
80
SCHEDULE I
COMMITMENTS AND APPLICABLE LENDING OFFICES
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
Name of Initial Term A Swing Line Revolving Letter of Domestic Eurodollar
Lender Commitment Commitment Credit Credit Lending Office Lending
Commitment Commitment Office
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
Banque $12,500,000 $5,000,000 $12,500,000 $3,000,000 CREDIT MATTERS CREDIT MATTERS
Nationale de -------------- --------------
Paris 000 Xxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxx Xxxxxxxxxx Attn: Xxxx Xxxxxxxxxx
OPERATIONS OPERATIONS
---------- ----------
000 Xxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxx Attn: Xxxxxxxx Xxxxxxxx
Xxxxxxxx
PAYMENTS
PAYMENT --------
-------- 000 Xxxx Xxxxxx
000 Xxxx Xxxxxx Xxx Xxxx, XX 00000
Xxx Xxxx, XX 00000 ABA No.:0260077689
ABA No.:0260077689 Xxxx.Xx.:75042070103
Xxxx.Xx.:75042070103 Reference: Safety 1st,
Reference: Safety Inc.
1st, Inc.
----------------- -------------- --------------- -------------- -------------- ---------------------- -----------------------
Union Bank of $12,500,000 $0 $12,500,000 $0 CREDIT MATTERS CREDIT MATTERS
California -------------- --------------
000 Xxxxxxxxxx Xxxxxx 000 Xxxxxxxxxx Xxxxxx
0xx Xx. 0xx Xx.
Xxx Xxxxxxxxx, XX Xxx Xxxxxxxxx, XX
00000-0000 94104-1402
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxx Xxxxxxx Attn: Xxxxx Xxxxxxx
Vice President Vice President
OPERATIONS
OPERATIONS ----------
---------- 0000 Xxxxxx Xxxxxx
0000 Xxxxxx Xxxxxx Xxxxxxxx Xxxx, XX
Xxxxxxxx Xxxx, XX 00000
91755 Tel: (000) 000-0000
Tel: (000) 000-0000 Fax: (000) 000-0000
Fax: (000) 000-0000 Attn: Xxxxx Xxxxxxxxxx
Attn: Gohar Commercial Customer
Xxxxxxxxxx Service Center
Commercial Customer
Service Center PAYMENTS
--------
PAYMENTS Union Bank of
-------- California, N.A.
Union Bank of 0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, N.A. Monterey Park, CA
0000 Xxxxxx Xxxxxx 00000
Xxxxxxxx Xxxx, XX ABA No: 000-000-000
91755 Acct No: 070196431
ABA No: 000-000-000 Account Name: Wire
Acct No: 070196431 Transfer Clearing
81
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
Name of Initial Term A Swing Line Revolving Letter of Domestic Eurodollar
Lender Commitment Commitment Credit Credit Lending Office Lending
Commitment Commitment Office
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
Account Name: Wire Attn: 182-Note Center
Transfer Clearing CLO
Attn: 182-Note Ref: Safety 1st, Inc.
Center CLO
Ref: Safety 1st, Inc.
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
LaSalle Bank $10,000,000 $0 $10,000,000 $0 CREDIT MATTERS CREDIT MATTERS
-------------- --------------
135 SO. LASALLE 135 SO. LASALLE
CHICAGO, IL 60603 XXXXXXX, XX 00000
TEL: (000) 000-0000 TEL: (000) 000-0000
FAX: (000) 000-0000 FAX: (000) 000-0000
ATTN: COMMERCIAL ATTN: COMMERCIAL BANKING
BANKING
OPERATIONS
OPERATIONS ----------
---------- 135 SO. LASALLE
135 SO. LASALLE CHICAGO, IL 60603
XXXXXXX, XX 00000 TEL: (000) 000-0000
TEL: (000) 000-0000 FAX: (000) 000-0000
FAX: (000) 000-0000 ATTN: COMMERCIAL BANKING
ATTN: COMMERCIAL
PAYMENTS
BANKING --------
PAYMENTS 000 XXXXX XXXXXXX
-------- SUITE 1140
000 XXXXX XXXXXXX XXXXXXX, XX 00000
SUITE 1140 ABA NO :000000000
XXXXXXX, XX 00000 ACCT NO: 1378018
ABA NO: 000000000 REFERENCE: SAFETY 1ST,
ACCT NO: 1378018 INC.
REFERENCE: SAFETY
1ST, INC.
----------------- -------------- --------------- -------------- -------------- ---------------------- -------------------------
82
EXECUTION COPY
$70,000,000
CREDIT AGREEMENT
Dated as of October 21, 1999
Among
SAFETY 1ST, INC.,
as BORROWER,
and
THE INITIAL LENDERS NAMED HEREIN,
UNION BANK OF CALIFORNIA, N.A.
as SYNDICATION AGENT
LASALLE BANK NATIONAL ASSOCIATION
as DOCUMENTATION AGENT
BANQUE NATIONALE DE PARIS
as ADMINISTRATIVE AGENT, SWING LINE BANK and INITIAL ISSUING BANK
and
BNP CAPITAL MARKETS, LLC
as LEAD ARRANGER
83
T A B L E O F C O N T E N T S
SECTION PAGE
ARTICLE I DEFINITIONS AND ACCOUNTING TERMS
1.01. Certain Defined Terms 1
1.02. Computation of Time Periods; Other Definitional Provisions 27
1.03. Accounting Terms 28
ARTICLE II AMOUNTS AND TERMS OF THE ADVANCES AND THE LETTERS OF CREDIT
2.01. The Advances and the Letters of Credit 28
2.02. Making the Advances 29
2.03. Issuance of and Drawings and Reimbursement Under Letters of Credit 31
2.04. Repayment of Advances 32
2.05. Termination or Reduction of the Commitments 34
2.06. Prepayments 35
2.07. Interest 37
2.08. Fees 38
2.09. Conversion of Advances 38
2.10. Increased Costs, Etc. 39
2.11. Payments and Computations 40
2.12. Taxes 42
2.13. Sharing of Payments, Etc. 43
2.14. Use of Proceeds 44
2.15. Evidence of Debt 44
84
SECTION PAGE
ARTICLE III CONDITIONS OF LENDING AND ISSUANCES OF LETTERS OF CREDIT
3.01. Conditions Precedent to Initial Extension of Credit 45
3.02. Conditions Precedent to Each Borrowing, Swing Line Advance and
Issuance 50
3.03. Determinations Under Section 3.01 51
ARTICLE IV REPRESENTATIONS AND WARRANTIES
4.01. Representations and Warranties of the Borrower 51
ARTICLE V COVENANTS
5.01. Affirmative Covenants 57
5.02. Negative Covenants 62
5.03. Reporting Requirements 67
5.04. Financial Covenants 70
ARTICLE VI EVENTS OF DEFAULT
6.01. Events of Default 74
6.02. Actions in Respect of the Letters of Credit upon Default 77
ARTICLE VII THE AGENTS
7.01. Authorization and Action 77
7.02. Agents' Reliance, Etc. 78
7.03. BNP and Affiliates 78
7.04. Lender Party Credit Decision 78
7.05. Indemnification 78
7.06. Successor Agents 79
7.07. Agents and Arrangers 80
7.08. Additional Agents 80
ARTICLE VIII MISCELLANEOUS
8.01. Amendments, Etc. 80
8.02. Notices, Etc. 81
8.03. No Waiver; Remedies 81
8.04. Costs and Expenses 81
8.05. Right of Set-off 83
8.06. Binding Effect 83
8.07. Assignments and Participations 83
8.08. Execution in Counterparts 86
8.09. No Liability of the Issuing Bank 86
8.10. Jurisdiction, Etc. 86
8.11. Governing Law 87
8.12. Judgment and Currency Determination 87
8.13. Waiver of Jury Trial 87
85
Schedule I - Commitments and Applicable Lending Offices
Schedule 3.01(a)(iii)(C) - Landlord Consents
Schedule 3.01(a)(iii)(H) - Blocked Account Banks
Schedule 3.01(a)(v) - Initial Guarantors
Schedule 3.01(a)(viii) - Secretary of State Certificates
Schedule 3.01(g) - Surviving Debt
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(d) - Authorizations, Approvals, Actions, Notices and Filings
Schedule 4.01(m)(vi) - Plans, Multiemployer Plans and Welfare Plans
Schedule 4.01(o) - Open Years
Schedule 4.01(q) - Existing Debt
Schedule 4.01(r) - Owned Real Property
Schedule 4.01(s) - Leased Real Property
Schedule 4.01(u) - Intellectual Property
Schedule 4.01(v) - Existing Liens
86
EXHIBITS
Exhibit A-1 - Form of Term A Note
Exhibit A-2 - Form of Working Capital Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D - Form of Security Agreement (Borrower)
Exhibit E-1 - Form of Subsidiary Guaranty (Loan Documents)
Exhibit X-0 - Xxxx xx Xxxxxxxxxx Xxxxxxxx - Xxxxxx (Loan Documents)
Exhibit E-3 - Form of Non-U.S. Subsidiary Guaranty (Intercompany Notes)
Exhibit E-4 - Form of Canadian Subsidiary Guaranty (Intercompany Notes)
Exhibit F - Form of Borrowing Base Certificate
Exhibit G - Form of Borrower Solvency Certificate
Exhibit H - Form of Opinion of Counsel to the Loan Parties
