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EXECUTION COUNTERPART
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CREDIT AGREEMENT
dated as of March 31, 1998
among
XXXXXXX FURNITURE COMPANIES, INC.,
THE LENDERS LISTED HEREIN,
and
SUNTRUST BANK, ATLANTA
as Agent
and
FIRST UNION NATIONAL BANK
and
NATIONSBANK, N.A.
as Co-Agents
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TABLE OF CONTENTS
Page
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ARTICLE I.
DEFINITIONS; CONSTRUCTION..............................................................1
Section 1.01. Definitions.............................................................1
Section 1.02. Accounting Terms and Determination.....................................19
Section 1.03. Other Definitional Terms...............................................20
Section 1.04. Exhibits and Schedules.................................................20
ARTICLE II.
SYNDICATED LOANS, BID RATE LOANS, SWING LINE LOANS
AND LETTERS OF CREDIT.................................................................20
Section 2.01. Commitments; Use of Proceeds...........................................20
Section 2.02. Notes; Repayment of Principal..........................................21
Section 2.03. Voluntary Reduction of Commitments.....................................21
Section 2.04. Letter of Credit Facility..............................................21
Section 2.05. Notice of Issuance of Letter of Credit;
Agreement to Issue ....................................................22
Section 2.06. Payment of Amounts Drawn Under Letters of Credit.......................22
Section 2.07. Payment by Lenders.....................................................23
Section 2.08. Swing Line Loans.......................................................24
Section 2.09. Bid Rate Loans.........................................................26
ARTICLE III.
GENERAL LOAN AND LETTER OF CREDIT TERMS...............................................28
Section 3.01. Funding Notices........................................................28
Section 3.02. Disbursement of Funds..................................................29
Section 3.03. Interest...............................................................30
Section 3.04. Interest Periods.......................................................32
Section 3.05. Fees...................................................................33
Section 3.06. Voluntary Prepayments of Borrowings....................................33
Section 3.07. Payments, Etc..........................................................34
Section 3.08. Interest Rate Not Ascertainable, Etc...................................35
Section 3.09. Illegality.............................................................36
Section 3.10. Increased Costs........................................................37
Section 3.11. Lending Offices........................................................39
Section 3.12. Funding Losses.........................................................39
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Section 3.13. Assumptions Concerning Funding of
Eurodollar Advances....................................................39
Section 3.14. Apportionment of Payments..............................................40
Section 3.15. Sharing of Payments, Etc...............................................40
Section 3.16. Letter of Credit Obligations Absolute..................................40
ARTICLE IV.
CONDITIONS TO BORROWINGS..............................................................41
Section 4.01. Conditions Precedent to Initial Loans
and Letters of Credit..................................................41
Section 4.02. Conditions to All Loans and Letters of Credit..........................43
ARTICLE V.
REPRESENTATIONS AND WARRANTIES........................................................44
Section 5.01. Corporate Existence; Compliance with Law...............................44
Section 5.02. Corporate Power; Authorization.........................................44
Section 5.03. Enforceable Obligations................................................44
Section 5.04. No Legal Bar...........................................................45
Section 5.05. No Material Litigation or Investigations...............................45
Section 5.06. Investment Company Act, Etc............................................45
Section 5.07. Margin Regulations.....................................................45
Section 5.08. Compliance With Environmental Laws.....................................45
Section 5.09. Insurance..............................................................46
Section 5.10. No Default.............................................................46
Section 5.11. Taxes..................................................................46
Section 5.12. Subsidiaries...........................................................47
Section 5.13. Financial Statements...................................................47
Section 5.14. ERISA..................................................................47
Section 5.15. Patents, Trademarks, Licenses, Etc.....................................48
Section 5.16. Ownership of Property..................................................48
Section 5.17. Financial Condition....................................................49
Section 5.18. Labor Matters..........................................................49
Section 5.19. Payment or Dividend Restrictions.......................................49
Section 5.20. Disclosure.............................................................49
ARTICLE VI.
AFFIRMATIVE COVENANTS.................................................................50
Section 6.01. Corporate Existence; Maintenance of Properties.........................50
Section 6.02. Compliance with Laws, Etc..............................................50
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Section 6.03. Taxes and Claims.......................................................50
Section 6.04. Compliance with Other Agreements.......................................51
Section 6.05. Inspection of Property.................................................51
Section 6.06. Insurance..............................................................51
Section 6.07. Business...............................................................51
Section 6.08. Keeping of Books.......................................................51
Section 6.09. Reporting Covenants....................................................51
Section 6.10. Covenant to Secure Notes Equally.......................................54
Section 6.11. Additional Credit Parties..............................................54
ARTICLE VII.
NEGATIVE COVENANTS....................................................................55
Section 7.01. Certain Financial Limits...............................................55
Section 7.02. Liens, Debt and Other Restrictions.....................................55
Section 7.03. Sale of Property.......................................................59
Section 7.04. Subsidiary Stock and Debt..............................................60
Section 7.05. ERISA..................................................................60
Section 7.06. Environmental Matters..................................................61
Section 7.07. Amendment of Articles or Bylaws........................................61
ARTICLE VIII.
EVENTS OF DEFAULT.....................................................................61
Section 8.01. Payments...............................................................61
Section 8.02. Covenants Without Notice...............................................61
Section 8.03. Other Covenants........................................................61
Section 8.04. Representations........................................................62
Section 8.05. Non-Payments of Other Debt.............................................62
Section 8.06. Defaults Under Other Agreements........................................62
Section 8.07. Bankruptcy.............................................................62
Section 8.08. ERISA..................................................................63
Section 8.09. Money Judgment.........................................................63
Section 8.10. Ownership of Guarantors................................................63
Section 8.11. Change in Control of Borrower..........................................63
Section 8.12. Default Under Other Credit Documents...................................64
Section 8.13. Attachments............................................................64
ARTICLE IX.
THE AGENT AND CO-AGENTS...............................................................65
Section 9.01. Appointment of Agent...................................................65
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Section 9.02. Authorization of Agent with
Respect to the Security Documents.....................................65
Section 9.03. Nature of Duties of Agent.............................................66
Section 9.04. Lack of Reliance on the Agent.........................................66
Section 9.05. Certain Rights of the Agent...........................................66
Section 9.06. Reliance by Agent.....................................................67
Section 9.07. Indemnification of Agent..............................................67
Section 9.08. The Agent in its Individual Capacity..................................67
Section 9.09. Holders of Notes......................................................67
Section 9.10. Successor Agent.......................................................68
Section 9.11. Co-Agents.............................................................68
ARTICLE X.
MISCELLANEOUS.........................................................................68
Section 10.01. Notices...............................................................68
Section 10.02. Amendments, Etc.......................................................69
Section 10.03. No Waiver; Remedies Cumulative........................................69
Section 10.04. Payment of Expenses, Etc..............................................69
Section 10.05. Waiver of Right of Setoff.............................................71
Section 10.06. Benefit of Agreement..................................................71
Section 10.07. Governing Law; Submission to Jurisdiction;
Waiver of Jury Trial..................................................74
Section 10.08. Independent Nature of Lenders' Rights.................................74
Section 10.09. Counterparts..........................................................75
Section 10.10. Effectiveness; Survival...............................................75
Section 10.11. Severability..........................................................75
Section 10.12. Independence of Covenants.............................................75
Section 10.13. Change in Accounting Principles,
Fiscal Year or Tax Laws...............................................75
Section 10.14. Headings Descriptive; Entire Agreement................................76
SCHEDULES
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SCHEDULE 5.01(A) Lack of Qualification
SCHEDULE 5.01(B) Organization and Ownership of Subsidiaries
SCHEDULE 5.05 Certain Pending and Threatened Litigation
SCHEDULE 5.08 Environmental Matters
SCHEDULE 5.11 Tax Filings and Payments
SCHEDULE 5.14 Employee Benefit Matters
SCHEDULE 5.15 Patent, Trademark, License, and Other Intellectual Property Matters
SCHEDULE 5.16 Ownership of Properties
SCHEDULE 5.19 Dividend Restrictions
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SCHEDULE 7.02(A) Existing Liens
SCHEDULE 7.02(B) Existing Debt
EXHIBITS
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EXHIBIT A - Form of Revolving Note
EXHIBIT B - Form of Bid Facility Note
EXHIBIT C - Form of Swing Line Note
EXHIBIT D - Bid Request
EXHIBIT E - Bid Request Invite
EXHIBIT F - Bid Rate Bid
EXHIBIT G - Bid Rate Acceptance/Rejection
EXHIBIT H - Form of Guaranty Agreement
EXHIBIT I - Form of Closing Certificate
EXHIBIT J - Form of Opinion of Xxxxx, Xxxxxxxx & Xxxxxxx, LLP
EXHIBIT K - Form of Assignment and Acceptance Agreement
EXHIBIT L - Form of Compliance Certificate
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CREDIT AGREEMENT
THIS CREDIT AGREEMENT made and entered into as of March 31, 1998, by
and among XXXXXXX FURNITURE COMPANIES, INC., a corporation organized and
existing under the laws of the State of Maryland (the "Borrower"), SUNTRUST
BANK, ATLANTA, a banking corporation organized under the laws of the State of
Georgia ("SunTrust"), the other banks and lending institutions listed on the
signature pages hereof, and any assignees of SunTrust, or such other banks and
lending institutions which become "Lenders" as provided herein (SunTrust, and
such other banks, lending institutions, and assignees referred to collectively
herein as the "Lenders"), SUNTRUST BANK, ATLANTA, in its capacity as agent for
the Lenders and each successor agent for such Lenders as may be appointed from
time to time pursuant to Article IX hereof (the "Agent"), FIRST UNION NATIONAL
BANK and NATIONSBANK, N.A., in their respective capacities as co-agents for the
Lenders (the "Co-Agents");
W I T N E S S E T H:
WHEREAS, Borrower has requested that the Lenders provide certain
commitments to Borrower to extend credit facilities to Borrower in the maximum
aggregate principal amount of $50,000,000;
WHEREAS, the Lenders, the Agent, and the Co-Agents have agreed to
provide such facilities, subject to the terms, conditions and requirements set
forth in this Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, Borrower, the Lenders, the Agent and the Co-Agents
intending to be legally bound, hereby agree as follows:
ARTICLE I.
DEFINITIONS; CONSTRUCTION
SECTION 1.01. DEFINITIONS. In addition to the other terms defined
herein, the following terms used herein shall have the meanings herein specified
(to be equally applicable to both the singular and plural forms of the terms
defined):
"Adjusted Debt" shall mean, with respect to any Person, at any date of
determination, the sum of all Debt, less 50% of the Unused Capacity for Financed
Receivables.
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"Adjusted LIBO Rate" shall mean, with respect to each Interest Period
for a Eurodollar Advance, the rate per annum (rounded upwards, if necessary, to
the nearest 1/100 of 1%) determined pursuant to the following formula:
Adjusted LIBO Rate = LIBOR
------------------------
1.00 - LIBOR Reserve Percentage
As used herein, LIBOR Reserve Percentage shall mean, for any Interest Period for
a Eurodollar Advance, the reserve percentage (expressed as a decimal) equal to
the then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves)
applicable to any member bank of the Federal Reserve System in respect of
Eurocurrency liabilities as defined in Regulation D (or against any successor
category of liabilities as defined in Regulation D).
"Advance" shall mean any principal amount advanced and remaining
outstanding at any time under (i) the Syndicated Loans, which Advances shall be
made or outstanding as Base Rate Advances or Eurodollar Advances, as the case
may be, (ii) the Bid Rate Loans, which Advances shall be made or outstanding as
Bid Rate Advances, or (iii) the Swing Line Loans, which Advances shall be made
or outstanding as Swing Line Advances.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by, or under common control with, such Person, whether
through the ownership of voting securities, by contract or otherwise. For
purposes of this definition, "control" (including with correlative meanings, the
terms "controlling", "controlled by", and "under common control with") as
applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
Person.
"Agent" shall mean SunTrust Bank, Atlanta, formerly known as Trust
Company Bank, a Georgia banking corporation and any successor agent appointed
pursuant to Section 9.10 hereof.
"Agreement" shall mean this Credit Agreement, as amended, modified,
restated, or supplemented from time to time.
"Applicable Facility Percentage" shall mean, through June 30, 1998,
.125% per annum, and (y) thereafter, the rate for any day to be used to
calculate the Facility Fee payable by Borrower hereunder, expressed as a
percentage and determined from the chart set forth below based on Borrower's
ratio of Consolidated Adjusted Debt to Consolidated Adjusted Capitalization
calculated as of the relevant determination date:
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CONSOLIDATED ADJUSTED DEBT
TO CONSOLIDATED ADJUSTED APPLICABLE FACILITY
CAPITALIZATION RATIO PERCENTAGE
-------------------- -------------------
Less than 30% .075%
Greater than or Equal to
30% and Less than
40% .100%
Greater than or Equal to
40% and Less than
50% .125%
Greater than or Equal to
50% .150%
Each change in the Applicable Facility Percentage resulting from a change in the
Consolidated Adjusted Debt to Consolidated Adjusted Capitalization ratio shall
be effective from and after the date that any related change in the Applicable
Margin is effective.
"Applicable Margin" shall mean (x) with respect to all
outstanding Eurodollar Advances through June 30, 1998, .275% per annum, and (y)
thereafter with respect to all outstanding Eurodollar Advances for any day, the
applicable percentage determined from the chart set forth below based on
Borrower's ratio of Consolidated Adjusted Debt to Consolidated Adjusted
Capitalization, expressed as a percentage, calculated as of the relevant
determination date:
CONSOLIDATED ADJUSTED DEBT
TO CONSOLIDATED ADJUSTED APPLICABLE
CAPITALIZATION RATIO MARGIN
-------------------- ----------
Less than 30% .175%
Greater than or Equal to
30% and Less than
40% .225%
Greater than or Equal to
40% and Less than
50% .275%
Greater than or Equal to
50% .350%
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The ratio of Consolidated Adjusted Debt to Consolidated Adjusted Capitalization,
calculated in accordance with Section 7.01, and the resulting Applicable Margin
shall be determined quarterly, based upon the financial statements delivered to
the Lenders pursuant to Section 6.09(a) or Section 6.09(b) hereof, as the case
may be, with such Applicable Margin to be effective with respect to calculations
based upon the financial statements delivered pursuant to Section 6.09 as of the
first day of the second fiscal quarter immediately following the fiscal quarter
for which such financial statements are delivered (for example, the Applicable
Margin effective with respect to all outstanding Eurodollar Advances as of the
first day of the third fiscal quarter shall be calculated based upon the
financial statements delivered for the first fiscal quarter of Borrower).
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an Eligible Assignee in accordance with the terms
of this Agreement and substantially in the form of Exhibit K.
"Attributable Debt" shall mean the present value (discounted according
to GAAP at the debt rate implicit in the lease) of the obligations of the lessee
for rental payments during the term of any lease constituting a Capitalized
Lease Obligation and a part of a Sale and Leaseback Transaction.
"Bankruptcy Code" shall mean The Bankruptcy Code of 1978, as amended
and in effect from time to time (11 U.S.C. ss. 101 et seq.).
"Base Rate" shall mean the higher of (with any change in the Base Rate
to be effective as of the date of change of either of the following rates):
(a) the rate which the Agent publicly announces from time to time
to be its prime lending rate, as in effect from time to time, and
(b) the Federal Funds Rate, as in effect from time to time, plus
one-half of one percent (0.50%) per annum.
The Agent's prime lending rate is a reference rate and does not necessarily
represent the lowest or best rate charged to customers; the Agent may make
commercial loans or other loans at rates of interest at, above or below the
Agent's prime lending rate.
"Base Rate Advance" shall mean an Advance made or outstanding as (i) a
Syndicated Loan bearing interest based on the Base Rate, or (ii) an Advance
bearing interest at the rate agreed upon between Borrower and the Lenders
pursuant to Section 3.08, Section 3.09 or Section 3.10.
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"Bid Accept/Reject Letter" shall mean a notification made by Borrower
pursuant to Section 2.09 substantially in the form of Exhibit G.
"Bid Facility Note" shall mean a promissory note of Borrower payable to
the order of any Lender, in substantially the form of Exhibit B hereto,
evidencing the maximum aggregate principal indebtedness of Borrower to such
Lender with respect to outstanding Bid Rate Advances made by such Lender
pursuant to this Agreement, either as originally executed or as it may be from
time to time supplemented, modified, amended, renewed or extended.
"Bid Rate" shall mean, as to any Bid Rate Bid made by a Lender pursuant
to Section 2.09, the fixed rate of interest per annum offered by the Lender
making the Bid Rate Bid for the relevant Interest Period.
"Bid Rate Advance" shall mean an Advance made by a Lender to Borrower
pursuant to the bidding procedure described in Section 2.09.
"Bid Rate Bid" shall mean an offer by a Lender to make a Bid Rate Loan
pursuant to Section 2.09.
"Bid Rate Loan" shall mean a Borrowing made up of Advances by all of
those Lenders whose Bid Rate Bids have been accepted by Borrower pursuant to the
same Bid Request under the bidding procedure described in Section 2.09 for the
same Interest Period and interest rate (with the understanding that two Bid Rate
Loans may be made pursuant to a single Bid Request).
"Bid Request" shall mean a request made by Borrower pursuant to Section
2.09 substantially in the form of Exhibit D.
"Borrower" shall mean Xxxxxxx Furniture Companies, Inc., a Maryland
corporation, its successors and permitted assigns.
"Borrowing" shall mean the incurrence by Borrower under any Facility of
Advances of one Type concurrently having the same Interest Period or the
continuation or conversion of an existing Borrowing or Borrowings in whole or in
part.
"Business Day" shall mean:
(a) any day which is neither a Saturday or Sunday nor a legal holiday
on which banks are required or authorized to close in Atlanta, Georgia or New
York, New York; and
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(b) relative to the making, continuing, prepaying or repaying of
any Eurodollar Advances, any day on which trading is carried on by and between
banks in deposits of Dollars in the London interbank market.
"Capitalized Lease Obligations" shall mean all rental obligations
which, under GAAP, are or will be required to be capitalized on the books of the
Borrower or any Subsidiary in each case taken at the amount thereof accounted
for as indebtedness (net of interest expense) in accordance with such
principles.
"Closing Date" shall mean the date on or before March 31, 1998 on which
the initial Loans are made or deemed to have been made hereunder and the
conditions set forth in Section 4.01 are satisfied or waived in accordance with
Section 10.02.
"Co-Agents" shall have the meaning set forth in the preamble hereof.
"Commitment" shall mean, for any Lender at any time, the amount of such
commitment set forth opposite such Lender's name on the signature pages hereof,
as the same may be increased or decreased from time to time as a result of any
reduction thereof pursuant to Section 2.03, any assignment thereof pursuant to
Section 10.06, or any amendment thereof pursuant to Section 10.02.
"Consolidated" shall mean the consolidated financial information of the
Borrower and its Subsidiaries under GAAP.
"Consolidated Adjusted Capitalization" shall mean, at any time, the sum
of (i) Consolidated Capitalization, less 50% of the Unused Capacity for Financed
Receivables.
"Consolidated Adjusted Debt" shall mean the amount of Adjusted Debt of
the Borrower and its Subsidiaries on a Consolidated basis at any date of
determination.
"Consolidated Capitalization" shall mean, at any time, the sum of (i)
Consolidated Debt at such time plus (ii) Consolidated Net Worth at such time.
"Consolidated Companies" shall mean, collectively, Borrower and all of
its Subsidiaries.
"Consolidated Current Assets" shall mean, as of any date of
determination, the total assets of the Borrower and its Subsidiaries (without
duplication) which may properly be classified as current assets in accordance
with GAAP.
"Consolidated Current Liabilities" shall mean, as of any date of
determination, the total liabilities of the Borrower and its Subsidiaries
(without duplication) which may properly be classified as current liabilities in
accordance with GAAP.
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"Consolidated Debt" shall mean, the amount of Debt of the Borrower and
its Subsidiaries on a Consolidated basis at any date of determination.
"Consolidated Interest Charges" shall mean, for the Borrower and its
Subsidiaries on a Consolidated basis for the four fiscal quarters most recently
ended, all interest expense (including all amortization of debt discount and
expenses and inputted interest) on all Debt (including Capitalized Lease
Obligations) net of interest income.
"Consolidated Net Earnings" shall mean, for any applicable period for
the Borrower and its Subsidiaries on a Consolidated basis, the excess of (a)
gross revenues over (b) all expenses and charges of a proper character
(including current and deferred taxes on income, provision for taxes on
unremitted foreign earnings which are included in gross revenues, and current
additions to reserves) each for the applicable period, but not including in
gross revenues:
(a) any gains (net of expenses and taxes applicable thereto) in
excess of losses resulting from the sales, conversions or other dispositions of
capital assets,
(b) any gains resulting from the write-up of assets,
(c) any earnings of any Person acquired by the Borrower or any
Subsidiary through purchase, merger or consolidation or otherwise for any period
prior to acquisition not included in gross revenues under generally accepted
accounting principles, or
(d) any deferred credit representing the excess of equity in any
Subsidiary of the Borrower at the date of acquisition over the cost of the
investment in such Subsidiary,
all as determined in accordance with generally accepted accounting principles:
If the above calculation results in an amount less than zero, then there shall
be a "Consolidated Net Loss" for such periods as determined below.
"Consolidated Net Loss" shall mean, for any applicable period, for the
Borrower and its Subsidiaries on a Consolidated basis, the excess of (a)
expenses and charges of a proper character (including current and deferred taxes
on income, provision for taxes on unremitted foreign earnings which are included
in gross revenues, and current additions to reserves) over (b) gross revenues
for the same period, but not including in gross revenues those items listed in
clauses (i) through (iv), inclusive, in the definition Consolidated Net Earnings
above, all as determined in accordance with generally accepted accounting
principles. If the above calculation results in an amount of zero or more, then
there shall be "Consolidated Net Earnings" for such period as determined above.
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"Consolidated Net Worth" shall mean, at any time, for the Borrower and
its Subsidiaries on a Consolidated basis, shareholders' equity at such time
determined in accordance with GAAP.
"Consolidated Operating Income" shall mean, for the Borrower and its
Subsidiaries on a Consolidated basis for the four fiscal quarters most recently
ended, the sum of (i) Consolidated Net Earnings, or Consolidated Net Loss, as
the case may be, for such periods, plus (ii) Consolidated Interest Charges and
provision for taxes deducted in calculating such Consolidated Net Earnings or
Consolidated Net Loss.
"Consolidated Priority Debt" shall mean on a Consolidated basis at any
date of determination, the sum (without duplication) of:
(a) Consolidated Secured Debt,
(b) Attributable Debt,
(c) the aggregate amount of Debt of all Subsidiaries (excluding
Debt extended by Borrower or any of its Subsidiaries to
Havertys Credit Services, Inc.), and
(d) the aggregate outstanding amount of shares of Preferred Stock
of any Subsidiary owned by Persons other than the Borrower or
another Subsidiary.
"Consolidated Revenues" shall mean on a Consolidated basis at any date
of determination revenues as shown on a Consolidated income statement prepared
under generally accepted accounting principles.
"Consolidated Secured Debt" shall mean, on a Consolidated basis at any
date of determination, the sum of Capitalized Lease Obligations and any Debt of
any Person which is secured by, or otherwise benefitting from, a Lien on any
property, tangible or intangible, of the Borrower or any Subsidiary, whether or
not the Borrower or such Subsidiary has assumed or become liable for the payment
of such Debt or obligation.
"Consolidated Tangible Assets" shall mean, as at any date of
determination, the excess of (a) the total assets of the Borrower and its
Subsidiaries appearing on a Consolidated balance sheet prepared under GAAP as of
the date of determination, after deducting any reserves applicable thereto and
after eliminating all intercompany transactions and all amounts properly
attributable to minority interests, if any, in the stock and surplus of
Subsidiaries, over (b) the net book value of all Intangible Assets at such time.
"Consolidated Tangible Net Worth" shall mean, as of any date of
determination, the excess of (i) Consolidated Net Worth over (ii) the net book
value of all Intangible Assets at such time.
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"Contractual Obligation" of any Person shall mean any provision of any
security issued by such Person or of any agreement, instrument or undertaking
under which such Person is obligated or by which it or any of the property owned
by it is bound.
"Credit Documents" shall mean, collectively, this Agreement, the Notes,
the Letters of Credit, the Guaranty Agreement, and all other Security Documents,
if any.
"Credit Parties" shall mean, collectively, each of Borrower, the
Guarantor, and every other Person who from time to time executes a Security
Document with respect to all or any portion of the Obligations.
"Debt" shall mean, with respect to any Person, at any date of
determination:
(i) all indebtedness for borrowed money which such Person has
directly or indirectly created, incurred or assumed (including, without
limitation, all Capitalized Lease Obligations);
(ii) all indebtedness, whether or note for borrowed money, secured
by any Lien on any property or asset owned or held by such Person subject
thereto, whether or not the indebtedness secured thereby shall have been assumed
by such Person;
(iii) any indebtedness, whether or not for borrowed money, with
respect to which such Person has become directly or indirectly liable and which
represents or has been incurred to finance the purchase price (or a portion
thereof) of any property or services or business acquired by such Person,
whether by purchase, consolidation, merger or otherwise other than any trade
payable in the ordinary course of business that is a current liability under
GAAP;
(iv) any indebtedness of the character referred to in clauses (i),
(ii) or (iii) of this definition deemed to be extinguished under GAAP but for
which such Person remains legally liable; and
(v) any indebtedness of any other Person of the character referred
to in clauses (i), (ii), (iii) or (iv) of this definition with respect to which
the Person whose Debt is being determined has become liable by way of a
Guaranty;
all as determined in accordance with GAAP, provided, however, Debt shall not
include endorsements of negotiable instruments for collection in the ordinary
course of business nor any portion of a Receivable Financing that is not shown
on the balance sheet as a liability pursuant to GAAP.
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"Default" shall mean any condition or event which, with notice or lapse
of time or both, would constitute an Event of Default.
"Disposition" shall have the meaning set forth in Section 7.03.
"Dollar" and "U.S. Dollar" and the sign "$" shall mean lawful money of
the United States of America.
"Eligible Assignee" shall mean a commercial bank organized under the
laws of the United States, or any state thereof, having total assets in excess
of $1,000,000,000 or any commercial finance or asset based lending Affiliate of
any such commercial bank.
"Environmental Laws" shall mean all federal, state, local and foreign
statutes and codes or regulations, rules or ordinances issued, promulgated, or
approved thereunder, now or hereafter in effect (including, without limitation,
those with respect to asbestos or asbestos containing material or exposure to
asbestos or asbestos containing material), relating to pollution or protection
of the environment and relating to public health and safety, relating to (i)
emissions, discharges, releases or threatened releases of pollutants,
contaminants, chemicals or industrial toxic or hazardous constituents,
substances or wastes, including without limitation, any Hazardous Substance,
petroleum including crude oil or any fraction thereof, any petroleum product or
other waste, chemicals or substances regulated by any Environmental Law into the
environment (including without limitation, ambient air, surface water, ground
water, land surface or subsurface strata), or (ii) the manufacture, processing,
distribution, use, generation, treatment, storage, disposal, transport or
handling of any Hazardous Substance, petroleum including crude oil or any
fraction thereof, any petroleum product or other waste, chemicals or substances
regulated by any Environmental Law, and (iii) underground storage tanks and
related piping, and emissions, discharges and releases or threatened releases
therefrom, such Environmental Laws to include, without limitation (i) the Clean
Air Act (42 U.S.C. ss. 7401 et seq.), (ii) the Clean Water Act (33 U.S.C. ss.
1251 et seq.), (iii) the Resource Conservation and Recovery Act (42 U.S.C. ss.
6901 et seq.), (iv) the Toxic Substances Control Act (15 U.S.C. ss. 2601 et
seq.), and (v) the Comprehensive Environmental Response Compensation and
Liability Act, as amended by the Superfund Amendments and Reauthorization Act
(42 U.S.C. ss. 9601 et seq.).
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended and in effect from time to time.
"ERISA Affiliate" shall mean, with respect to any Person, each trade or
business (whether or not incorporated) which is a member of a group of which
that Person is a member and which is under common control within the meaning of
the regulations promulgated under Section 414 of the Tax Code.
"Eurodollar Advance" shall mean an Advance made or outstanding as a
Syndicated Loan bearing interest based on the Adjusted LIBO Rate.
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"Event of Default" shall have the meaning provided in Article VIII.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute thereto.
"Facility" or "Facilities" shall mean the Commitments, the Bid Rate
subfacility, the Swing Line subfacility or the Letter of Credit subfacility, as
the context may indicate.
"Facility Fee" shall have the meaning set forth in Section 3.05(a).
"Fair Market Value" shall mean at any time, the value of property that
would be realized in an arm's length sale at such time between an informed and
willing buyer, and an informed and willing seller, under no compulsion to buy or
sell, respectively.
"Federal Funds Rate" shall mean for any period, a fluctuating interest
rate per annum equal for each day during such period to the weighted average of
the rates on overnight Federal funds transactions with member banks 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 Atlanta, or, if such rate is not so published for
any day which is a Business Day, the average of the quotations for such day on
such transactions received by the Agent from three Federal funds brokers of
recognized standing selected by the Agent.
"Financed Receivables Amount" shall mean with respect to all
Receivables Financings after the Closing Date, the aggregate amount actually
paid to the Borrower and/or Subsidiary (and not including any deferred payment)
less the aggregate amount of cash received by the purchaser or financier as
principal payments in respect of the amounts paid to the Borrower and/or
Subsidiary and applied to reduce the amounts paid to the Borrower and/or
Subsidiary (the "net investment") provided that the net investment shall be
increased by the amount of any payment so received and applied if at any time
the distribution of such collections is rescinded or must otherwise be returned
or restored for any reason.
"GAAP" shall mean generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination.
"Guarantor" shall mean, Havertys Credit Services, Inc. and each other
Material Subsidiary of the Borrower hereafter created or acquired.
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"Guaranty" shall mean any contractual obligation, contingent or
otherwise, of a Person with respect to any Debt or other obligation or liability
of another Person, including without limitation, any such Debt, obligation or
liability directly or indirectly guaranteed, endorsed, co-made or discounted or
sold with recourse by that Person, or in respect of which that Person is
otherwise directly or indirectly liable, including contractual obligations
(contingent or otherwise) arising through any agreement to purchase, repurchase,
or otherwise acquire such Debt, obligation or liability or any security
therefor, or any agreement to provide funds for the payment or discharge thereof
(whether in the form of loans, advances, stock purchases, capital contributions
or otherwise), or to maintain solvency, assets, level of income, or other
financial condition, or to make any payment other than for value received. The
amount of any Guaranty shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which guaranty is
made or, if not so 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.
"Guaranty Agreement" shall mean, the Guaranty Agreement, dated as of
even date herewith, executed by the Guarantors in favor of the Lenders and the
Agent, substantially in the form of Exhibit H as the same may be amended,
restated or supplemented from time to time.
"Hazardous Substances" shall have the meaning assigned to that term in
the Comprehensive Environmental Response Compensation and Liability Act of 1980,
as amended by the Superfund Amendments and Reauthorization Act of 1986.
"Intangible Assets" shall mean those assets which would be treated as
intangible under generally accepted accounting principles, including, without
limitation, such items as good will, trademarks, trade names, service marks,
brand names, copyrights, patents, licenses, noncompete agreements and rights
with respect to the foregoing, unamortized debt discount and expense,
organizational expenses, and the excess of cost of purchased Subsidiaries over
equity in the net assets (based on Fair Market Value) thereof at the date of
acquisition.
"Interest Period" shall mean (i) as to any Eurodollar Advances, the
interest period selected by Borrower pursuant to Section 3.04(a) hereof, (ii) as
to any Bid Rate Advances, the interest period requested by Borrower and agreed
to by the participating Lenders pursuant to Section 3.04(b) hereof, and (iii) as
to any Swing Line Advance, the interest period agreed to by the Borrower and the
Swing Line Lender pursuant to Section 3.04(c) hereof.
"Lease" shall have the meaning set forth in Section 7.03.
"Lender" or "Lenders" shall mean SunTrust, the other banks and lending
institutions listed on the signature pages hereof, and each assignee thereof, if
any, pursuant to Section 10.06(c).
"Lending Office" shall mean for each Lender the office such Lender may
designate in writing from time to time to Borrower and the Agent with respect to
each Type of Loan.
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"Letter of Credit Fee" shall have the meaning set forth in Section
3.05(b).
"Letters of Credit" shall mean the letters of credit issued pursuant to
Article II hereof by the Agent for the account of Borrower pursuant to the
Commitments.
"Letter of Credit Obligations" shall mean, with respect to Letters of
Credit, as at any date of determination, the sum of (a) the maximum aggregate
amount which at such date of determination is available to be drawn by the
beneficiaries thereof (assuming the conditions for drawing thereunder have been
met) under all Letters of Credit then outstanding, plus (b) the aggregate amount
of all drawings under Letters of Credit honored by the Agent not theretofore
reimbursed by Borrower.
"LIBOR" shall mean, for any Interest Period, with respect to Eurodollar
Advances under the Commitments, the offered rate for deposits in Dollars, for a
period comparable to the Interest Period and in an amount comparable to the
requested Advances, appearing on Telerate Page 3750 as of 11:00 AM (London,
England time) on the day that is two Business Days prior to the first day of the
Interest Period. If two or more of such rates appear on such Telerate Page, the
rate shall be the arithmetic mean of such rates. If the foregoing rate is
unavailable from Telerate for any reason, then such rate shall be determined by
the Agent from the Reuters Screen LIBO Page or, if such rate is also unavailable
on such service, then on any other interest rate reporting service of recognized
standing designated in writing by the Agent to Borrower and the other Lenders;
in any such case rounded, if necessary, to the next higher 1/100 of 1.0%, if the
rate is not such a multiple.
"Lien" shall mean any mortgage, pledge, security interest, lien,
charge, hypothecation, assignment, deposit arrangement, title retention,
preferential property right, trust or other arrangement having the practical
effect of the foregoing and shall include the interest of a vendor or lessor
under any conditional sale agreement, capitalized lease or other title retention
agreement.
"Loans" shall mean, collectively, the Syndicated Loans, the Swing Line
Loans and the Bid Rate Loans.
"Margin Regulations" shall mean Regulation G, Regulation T, Regulation
U and Regulation X of the Board of Governors of the Federal Reserve System, as
the same may be in effect from time to time.
"Material Subsidiary" shall mean each Subsidiary of the Borrower, now
existing or hereafter established or acquired, that at any time prior to the
termination of this Agreement, accounts for or produces more than ten percent
(10%) of Consolidated Operating Income of the Borrower and its Subsidiaries, on
a Consolidated basis; provided that, Haverty's Capital, Inc., a Nevada
corporation, shall not be deemed to be a Material Subsidiary.
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"Materially Adverse Effect" shall mean any materially adverse change in
(i) the business, results of operations, financial condition, assets or
prospects of the Consolidated Companies, taken as a whole, (ii) the ability of
Borrower to perform its obligations under this Agreement, or (iii) the ability
of the other Credit Parties (taken as a whole) to perform their respective
obligations under the Credit Documents.
"Maturity Date" shall mean the earlier of (i) March 31, 2003, and (ii)
the date on which all amounts outstanding under this Agreement have been
declared or have automatically become due and payable pursuant to the
provisions of Article VIII.
"Moody's" shall mean Xxxxx'x Investors Service, Inc., and its
successors and assigns.
"Multiemployer Plan" shall have the meaning set forth in Section
4001(a)(3) of ERISA.
"Notes" shall mean, collectively, the Revolving Credit Notes, the Swing
Line Note and the Bid Facility Notes.
"Notice of Borrowing" shall have the meaning provided in Section
3.01(a)(i).
"Notice of Continuation/Conversion" shall have the meaning provided in
Section 3.01(b)(i).
"Officer's Certificate" shall mean a certificate signed in the name of
the Borrower by its Chairman of the Board, President, Senior Vice President, one
of its Vice Presidents or its Treasurer.
"Obligations" shall mean all amounts owing to the Agent or any Lender
pursuant to the terms of this Agreement or any other Credit Document, including
without limitation, all Loans (including all principal and interest payments due
thereunder), all Letter of Credit Obligations, fees, expenses, indemnification
and reimbursement payments, indebtedness, liabilities, and obligations of the
Credit Parties, direct or indirect, absolute or contingent, liquidated or
unliquidated, now existing or hereafter arising pursuant to this Agreement or
any other Credit Document, together with all renewals, extensions, modifications
or refinancings thereof.
"Operating Lease Rentals" shall mean, as at the date of determination,
all fixed rents or charges (including such payments which the lessee is
obligated to make on termination of the lease or surrender of the property)
payable by the Borrower and its Subsidiaries (as lessee, sublessee, licensee,
franchisee or the like) under all leases, licenses, or other agreements for the
use or possession of real or personal property, tangible or intangible (except
Capitalized Lease Obligations) having a term of more than one year (whether as
an initial term or any extension or renewal thereof and including options to
renew or extend any term, whether or not exercised), during the last four
consecutive fiscal quarters, all as determined in accordance with GAAP.
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"Payment Office" shall mean the office specified as the "Payment
Office" for the Agent on the signature page of the Agent, or such other location
as to which the Agent shall have given written notice to Borrower and the
Lenders.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor thereto.
"Permitted Liens" shall mean those Liens expressly permitted by Section
7.02.
"Person" shall mean any individual, limited liability company,
partnership, firm, corporation, association, joint venture, trust or other
entity, or any government or political subdivision or agency, department or
instrumentality thereof.
"Plan" shall mean any "employee benefit plan" (as defined in Section
3(3) of ERISA), including, but not limited to, any defined benefit pension plan,
profit sharing plan, money purchase pension plan, savings or thrift plan, stock
bonus plan, employee stock ownership plan, Multiemployer Plan, or any plan,
fund, program, arrangement or practice providing for medical (including
post-retirement medical), hospitalization, accident, sickness, disability, or
life insurance benefits.
"Preferred Stock" shall mean, as applied to any corporation, shares of
stock of such corporation which are entitled to preference or priority over any
other shares of such corporation in respect of the payment of dividends or
distribution of assets upon liquidation or both.
"Pro Rata Share" shall mean, with respect to Commitments, each
Syndicated Loan and all Letters of Credit to be made by and each payment
(including, without limitation, any payment of principal, interest or fees) to
be made to each Lender, the percentage designated as such Lender's Pro Rata
Share of such Commitments, set forth under the name of such Lender on the
respective signature page for such Lender, as such percentage may change based
upon amendments and assignments hereunder.
"Properties" shall mean all real property owned, leased or otherwise
used or occupied by the Borrower or any Subsidiary, wherever located.
"Prudential Agreement" shall mean that certain Note Agreement dated
December 29, 1993 by and between the Borrower and The Prudential Insurance
Company of America relating to the Borrower's $92,500,000 in aggregate principal
amount 10.10% notes due April 15, 2000, 7.16% notes due April 15, 2007, 7.44%
notes due October 13, 2008, and 7.95% notes due August 15, 2008, either as
originally executed or as hereafter amended, modified or supplemented.
"Rating Agencies" shall mean, collectively, Moody's and S&P.
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"Receivables Financing" shall mean a transaction pursuant to which
funds are advanced to the Borrower and/or any of its Subsidiaries in exchange
for which the Borrower and/or any of its Subsidiaries shall sell, pledge,
contribute or place a Lien on any or all of its accounts or notes receivables to
repay, in whole or in part, such funds. However, this definition shall not
include any debit card, credit card or revolving charge sales where the obligor
is a financial institution.
"Regulation D" shall mean Regulation D of the Board of Governors of the
Federal Reserve System, as the same may be in effect from time to time.
"Required Lenders" shall mean at any time prior to the termination of
the Commitments, Lenders holding at least 66 2/3% of the then aggregate amount
of the Commitments, or, following the termination of the Commitments hereunder,
Lenders holding at least 66 2/3% of the sum of the aggregate outstanding Loans
and Letter of Credit Obligations.
"Requirement of Law" for any person shall mean the articles or
certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation, or
determination of an arbitrator or a court or other governmental authority, in
each case applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
"Responsible Officer" shall mean the chief executive officer, chief
operating officer, principal financial officer, principal accounting officer,
treasurer or assistant treasurer of the Borrower or any other senior executive
officer of the Borrower involved principally in its financial administration or
its controllership function.
"Retained Receivables Amount" shall mean, at any date of determination,
the aggregate amount of all outstanding customer accounts and notes receivable,
including installment contracts, of the Borrower and all Subsidiaries which
under GAAP are shown on the balance sheet as an asset, less (without
duplication):
(i) the greater of (a) and (b), where:
(a) is the amount of payments on such outstanding
customer accounts and notes receivable which are 61
days or more past due, or
(b) is an adequate reserve, or allowance for doubtful
accounts, as determined in accordance with GAAP,
pertaining to the aggregate amount of all such
outstanding customer accounts and notes receivable,
and
(ii) the amount of such outstanding customer accounts and
notes receivables sold, pledged, contributed or subject to a Lien in connection
with any Receivables Financing.
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"Reuters Screen" shall mean, when used in connection with any
designated page and LIBOR, the display page so designated on the Reuters Monitor
Money Rates Service (or such other page as may replace that page on that service
for the purpose of displaying rates comparable to LIBOR).
"Revolving Credit Notes" shall mean, collectively, the promissory notes
evidencing the Syndicated Loans in the form attached hereto as Exhibit A, either
as originally executed or as hereafter amended, modified or substituted.
"S&P" shall mean Standard & Poor's Rating Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Sale and Leaseback Transaction" shall mean any arrangement with any
Person or to which such Person is a party providing for the leasing by the
Borrower or any Subsidiary of real or personal property which has been or is to
be sold or transferred by the Borrower or any Subsidiary to any Person to which
funds have been or are to be advanced on the security of such property or rental
obligations of the Borrower or any Subsidiary.
"Security Documents" shall mean, collectively, the Guaranty Agreement,
and each other guaranty agreement, mortgage, deed of trust, security agreement,
pledge agreement, or other security or collateral document guaranteeing or
securing the Obligations, as the same may be amended, restated, or supplemented
from time to time.
"Solvent" shall mean, as to Borrower or any Guarantor at any time, that
(i) each of the fair value and the present fair saleable value of such Person's
assets (including any rights of subrogation or contribution to which such Person
is entitled, under any of the Credit Documents or otherwise) is greater than
such Person's debts and other liabilities (including contingent, unmatured and
unliquidated debts and liabilities) and the maximum estimated amount required to
pay such debts and liabilities as such debts and liabilities mature or otherwise
become payable; (ii) such Person is able and expects to be able to pay its debts
and other liabilities (including, without limitation, contingent, unmatured and
unliquidated debts and liabilities) as they mature; and (iii) such Person does
not have unreasonably small capital to carry on its business as conducted and as
proposed to be conducted.
"Subsidiary" shall mean, with respect to any Person, any corporation or
other entity (including, without limitation, partnerships, joint ventures, and
associations) regardless of its jurisdiction of organization or formation, at
least a majority of the total combined voting power of all classes of voting
stock or other ownership interests of which shall, at the time as of which any
determination is being made, be owned by such Person, either directly or
indirectly through one or more other Subsidiaries.
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"Subsidiary Credit Agreement" shall mean that certain Credit Agreement,
dated as of even date herewith, by and among Haverty Credit Services, Inc.,
SunTrust Bank, Atlanta, as Agent and the lenders from time to time party
thereto, either as originally executed or as hereafter from time to time amended
or modified.
"Swing Line Advance" shall mean a Borrowing pursuant to Section 2.08
consisting of a Swing Line Loan made by the Swing Line Lender to Borrower on the
same date and interest rate basis and for the same Interest Period.
"Swing Line Borrowing" shall mean a Borrowing consisting or to consist
of a Swing Line Advance.
"Swing Line Borrowing Notice" shall mean the notice given by Borrower
to the Agent and the Swing Line Lender requesting a Swing Line Advance as
provided in Section 2.08(c).
"Swing Line Facility" shall mean the credit facility described in
Section 2.08.
"Swing Line Lender" shall mean SunTrust Bank, Atlanta or any subsequent
Lender extending to Borrower the Swing Line Subcommitment hereunder.
"Swing Line Loans" shall mean, collectively, the loans made to Borrower
by the Swing Line Lender pursuant to Section 2.08.
"Swing Line Note" shall mean the promissory note evidencing the Swing
Line Loans substantially in the form of Exhibit C and duly completed in
accordance with the terms hereof.
"Swing Line Subcommitment" shall mean the commitment of the Swing Line
Lender to make Swing Line Loans in an aggregate principal amount at any time
outstanding not to exceed $5,000,000.
"Syndicated Loans" shall mean, collectively, all outstanding Loans made
to Borrower by the Lenders pursuant to Section 2.01 hereof based upon each
Lender's Pro Rata Share of the Revolving Loan Commitments.
"Tax Code" shall mean the Internal Revenue Code of 1986, as amended and
in effect from time to time.
"Taxes" shall mean any present or future taxes, levies, imposts,
duties, fees, assessments, deductions, withholdings or other charges of whatever
nature, including without limitation, income, receipts, excise, property, sales,
transfer, license, payroll, withholding, social security and franchise taxes now
or hereafter imposed or levied by the United States, or any state, local or
foreign government or by any department, agency or other political subdivision
or taxing
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authority thereof or therein and all interest, penalties, additions to tax and
similar liabilities with respect thereto.
"Telerate" shall mean, when used in connection with any designated page
and LIBOR, the display page so designated on the Dow Xxxxx Telerate Service (or
such other page as may replace that page on that service for the purpose of
displaying rates comparable to LIBOR).
"Term Loan Agreement" shall mean that certain Term Loan Agreement dated
as of March 31, 1995 by and between Borrower and Trust Company Bank (n/k/a
SunTrust Bank), as heretofore or hereafter amended, modified or supplemented.
"Third Party" shall mean all lessees, sublessees, licensees and other
users of the Properties, excluding those users of the Properties in the ordinary
course of the Borrower's business (consistent with its practices as of the
Closing Date) and on a temporary basis.
Transaction Rate" shall mean the rate of interest specified by the
Swing Line Lender to Borrower as being applicable to a Swing Line Loan requested
by Borrower pursuant to Section 2.08(c).
"Transaction Rate Quote" shall mean an offer by the Swing Line Lender
to make a Swing Line Loan to Borrower at the Transaction Rate specified therein
for the Interest Period to be applicable to the Swing Line Loan as specified
therein, pursuant to Section 2.08(c).
"Type" of Borrowing shall mean a Borrowing consisting of Base Rate
Advances, Bid Rate Advances or Eurodollar Advances.
"Unused Capacity for Financed Receivables" shall mean the difference
between (i) 55% of the sum of Retained Receivables Amount plus Financed
Receivables Amount, and (ii) Financed Receivables Amount.
SECTION 1.02. ACCOUNTING TERMS AND DETERMINATION. Unless otherwise
defined or specified herein, all accounting terms shall be construed herein, all
accounting determinations hereunder shall be made, all financial statements
required to be delivered hereunder shall be prepared, and all financial records
shall be maintained in accordance with, GAAP, provided, however, that compliance
with the financial covenants and calculations set forth in Article VII and
elsewhere herein, and in the definitions used in such covenants and
calculations, shall be calculated, made and applied in accordance with GAAP and
such generally accepted accounting principles in such foreign jurisdictions, as
the case may be, as in effect on the date of this Agreement applied on a basis
consistent with the preparation of the financial statements referred to in
Section 5.13 unless and until Borrower and the Required Lenders enter into an
agreement with respect thereto in accordance with Section 10.13.
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SECTION 1.03. OTHER DEFINITIONAL TERMS. The words "hereof", "herein"
and "hereunder" and words of similar import when used in this Agreement shall
refer to this Agreement as a whole and not to any particular provision of this
Agreement, and Article, Section, Schedule, Exhibit and like references are to
this Agreement unless otherwise specified. Any of the terms defined in Section
1.01 may, unless the context otherwise requires, be used in the singular or the
plural depending on the reference.
SECTION 1.04. EXHIBITS AND SCHEDULES. All Exhibits and Schedules
attached hereto are by reference made a part hereof.
ARTICLE II.
SYNDICATED LOANS, BID RATE LOANS, SWING LINE LOANS
AND LETTERS OF CREDIT
SECTION 2.01. COMMITMENTS; USE OF PROCEEDS.
(a) Subject to and upon the terms and conditions herein set forth,
each Lender severally agrees to make to Borrower from time to time on and after
the Closing Date, but prior to the Maturity Date, Syndicated Loans in an
aggregate amount outstanding at any time not to exceed such Lender's Commitment
minus such Lender's Pro Rata Share of the Letter of Credit Obligations, subject,
however, to the conditions that (i) at no time shall the sum of the (w) the
outstanding principal amount of all Syndicated Loans, plus (x) the outstanding
principal amount of all Bid Rate Loans, plus (y) the outstanding principal
amount of all Swing Line Loans, plus (z) the outstanding Letter of Credit
Obligations, exceed the sum of the Commitments, and (ii) at all times shall the
outstanding principal amount of the Syndicated Loans of each Lender equal the
product of each Lender's Pro Rata Share of the Commitments multiplied by the
aggregate outstanding amount of the Syndicated Loans. Borrower shall be entitled
to repay and reborrow Syndicated Loans in accordance with the provisions hereof.
(b) Each Syndicated Loan shall, at the option of Borrower, be made
or continued as, or converted into, part of one or more Borrowings that shall
consist entirely of Base Rate Advances or Eurodollar Advances. The aggregate
principal amount of each Borrowing of Syndicated Loans comprised of Base Rate
Advances shall be not less than $1,000,000 or a greater integral multiple of
$100,000 and aggregate principal amount of each Borrowing of Syndicated Loans
comprised of Eurodollar Advances shall be not less than $2,000,000 or a greater
integral multiple of $100,000. At no time shall the number of outstanding
Borrowings comprised of Eurodollar Advances and Bid Rate Advances exceed ten.
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(c) The proceeds of Loans shall be used by the Borrower solely for
working capital and other general corporate purposes, including acquisitions,
investments, the repayment of Debt and the funding of capital expenditures of
the Consolidated Companies.
SECTION 2.02. NOTES; REPAYMENT OF PRINCIPAL.
(a) Borrower's obligations to pay the principal of, and interest
on, the Syndicated Loans to each Lender shall be evidenced by the records of the
Agent and such Lender and by the Revolving Credit Note payable to such Lender
(or the assignor of such Lender) completed in conformity with this Agreement,
which records, absent manifest error, shall constitute prima facie evidence of
the amount owed by Borrower with respect to the Syndicated Loans.
(b) All outstanding principal amounts under the Commitments shall
be due and payable in full on the Maturity Date.
SECTION 2.03. VOLUNTARY REDUCTION OF COMMITMENTS. Upon at least three
(3) Business Days' prior written notice to the Agent, Borrower shall have the
right, without premium or penalty, to terminate the unutilized Commitments, in
part or in whole, provided that (i) any such termination shall apply to
proportionately and permanently reduce the Commitments of each of the Lenders,
and (ii) any partial termination pursuant to this Section 2.03 shall be in an
amount of at least $5,000,000 and integral multiples of $1,000,000.
SECTION 2.04. LETTER OF CREDIT FACILITY. Subject to, and upon the terms
and conditions set forth herein, Borrower may request, in accordance with the
provisions of this Section 2.04 and Section 2.05 and the other terms of this
Agreement, that on and after the Closing Date but prior to the Maturity Date,
the Agent issue a Letter or Letters of Credit for the account of Borrower;
provided that the aggregate outstanding amount of Letter of Credit Obligations
shall not at any time exceed $1,000,000, provided further that (i) no Letter of
Credit shall have an expiration date that is later than one year after the date
of issuance thereof (provided that a Letter of Credit may provide that it is
extendible for consecutive one year periods); (ii) in no event shall any Letter
of Credit issued by the Agent have an expiration date (or be extended so that it
will expire) later than the Maturity Date; and (iii) Borrower shall not request
that the Agent issue any Letter of Credit, if, after giving effect to such
issuance, the sum of the aggregate Letter of Credit Obligations plus the
aggregate outstanding principal amount of the Syndicated Loans plus the
aggregate outstanding principal amount of the Bid Rate Loans plus the aggregate
outstanding principal amount of the Swing Line Loans would exceed the
Commitments.
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SECTION 2.05. NOTICE OF ISSUANCE OF LETTER OF CREDIT; AGREEMENT TO
ISSUE.
(a) Whenever Borrower desires the issuance of a Letter of Credit,
it shall, in addition to any application and documentation procedures required
by the Agent for the issuance of such Letter of Credit, deliver to the Agent a
written notice no later than 11:00 AM (local time for the Agent) at least three
(3) Business Days' in advance of the proposed date of issuance and the Agent
shall promptly forward a copy of such notice to each of the Lenders. Each such
notice shall specify (i) the proposed date of issuance (which shall be a
Business Day); (ii) the face amount of the Letter of Credit; (iii) the
expiration date of the Letter of Credit; and (iv) the name and address of the
beneficiary with respect to such Letter of Credit and shall attach a precise
description of the documentation and a verbatim text of any certificate to be
presented by the beneficiary of such Letter of Credit which would require the
Agent to make payment under the Letter of Credit, provided that the Agent may
require changes in any such documents and certificates in accordance with its
customary letter of credit practices, and provided further, that no Letter of
Credit shall require payment against a conforming draft to be made thereunder on
the same Business Day that such draft is presented if such presentation is made
after 11:00 AM (Atlanta, Georgia time). In determining whether to pay any draft
under any Letter of Credit, the Agent shall be responsible only to determine
that the documents and certificate required to be delivered under its Letter of
Credit have been delivered, and that they comply on their face with the
requirements of the Letter of Credit. Promptly after receiving the notice of
issuance of a Letter of Credit, the Agent shall notify each Lender of such
Lender's respective participation therein, determined in accordance with its
respective Pro Rata Share.
(b) The Agent agrees, subject to the terms and conditions set
forth in this Agreement, to issue for the account of Borrower a Letter of Credit
in a face amount equal to the face amount requested under paragraph (a) above,
following its receipt of a notice required by Section 2.05(a). Immediately upon
the issuance of each Letter of Credit, each Lender shall be deemed to, and
hereby agrees to, have irrevocably purchased from the Agent a participation in
such Letter of Credit and any drawing thereunder in an amount equal to such
Lender's Pro Rata Share multiplied by the face amount of such Letter of Credit.
Upon issuance and amendment or extension of any Letter of Credit, the Agent
shall provide a copy of each such Letter of Credit issued, amended or extended
hereunder to each of the Lenders.
SECTION 2.06. PAYMENT OF AMOUNTS DRAWN UNDER LETTERS OF CREDIT.
(a) In the event of any request for a drawing under any Letter of
Credit by the beneficiary thereof, the Agent shall notify Borrower and the
Lenders on or before the date on which the Agent intends to honor such drawing,
and Borrower shall reimburse the Agent on the day on which such drawing is
honored in an amount, in same day funds, equal to the amount of such drawing.
(b) Notwithstanding any provision of this Agreement to the
contrary, to the extent that any Letter of Credit or portion thereof remains
outstanding on the Maturity Date, for any reason
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whatsoever, the parties hereto hereby agree that the beneficiary or
beneficiaries thereof shall be deemed to have made a drawing of all available
amounts pursuant to such Letters of Credit on the Maturity Date which amount
shall be held by the Agent as cash collateral for its remaining obligations
pursuant to such Letters of Credit.
(c) As between Borrower and the Agent, Borrower assumes all risk
of the acts and omissions of, or misuse of, the Letters of Credit issued by the
Agent, by the respective beneficiaries of such Letters of Credit, other than
losses resulting from the gross negligence and willful misconduct of the Agent.
In furtherance and not in limitation of the foregoing but subject to the
exception for the Agent's gross negligence or willful misconduct set forth
above, the Agent shall not be responsible (i) for the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of such Letters of
Credit, even if it should in fact prove to be in any or all respects
insufficient, inaccurate, fraudulent or forged or otherwise invalid; (ii) for
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof in whole or in part which may prove to
be invalid or ineffective for any reason; (iii) for failure of the beneficiary
of any such Letter of Credit to comply fully with the conditions required in
order to draw upon such Letter of Credit (without relieving the Agent of its
duties pursuant to the penultimate sentence of Section 2.05(a)); (iv) for
errors, omissions, interruptions or delays in transmission or delivery of any
messages, by mail, cable, telegraph, telex, telecopy or otherwise; (v) for good
faith errors in interpretation of technical terms; (vi) for any loss or delay in
the transmission or otherwise of any document required in order to make a
drawing under any such Letter of Credit or the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit; and (viii) for
any consequences arising from causes beyond the control of the Agent.
SECTION 2.07. PAYMENT BY LENDERS. In the event that Borrower shall fail
to reimburse the Agent as provided in Section 2.06, the Agent shall promptly
notify each Lender of the unreimbursed amount of such drawing and of such
Lender's respective participation therein. Each Lender shall make available to
the Agent an amount equal to its respective participation, in Dollars and in
immediately available funds, at the office of the Agent specified in such notice
not later than 1:00 P.M. (Atlanta, Georgia time) on the Business Day after the
date notified by the Agent and such amount shall be deemed to be outstanding
hereunder as a Base Rate Loan. Each Lender shall be obligated to make such Base
Rate Loan hereunder regardless of whether the conditions precedent in Article IV
are satisfied and regardless of whether such Base Rate Loan complies with the
minimum borrowing requirements hereunder. In the event that any such Lender
fails to make available to the Agent the amount of such Lender's participation
in such Letter of Credit, the Agent shall be entitled to recover such amount on
demand from such Lender together with interest as provided for in Section 3.02.
The Agent shall distribute to each Lender which has paid all amounts payable
under this Section with respect to any Letter of Credit, such Lender's Pro Rata
Share of all
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payments received by the Agent from Borrower in reimbursement of drawings
honored by the Agent under such Letter of Credit when such payments are
received.
SECTION 2.08. SWING LINE LOANS.
(a) Subject to and upon the terms and conditions herein set forth
(including the limitation set forth in Section 2.01), the Swing Line Lender
agrees to make to Borrower, from time to time prior to the Maturity Date, Swing
Line Loans in an aggregate principal amount outstanding at any time not to
exceed the Swing Line Subcommitment. Borrower shall be entitled to borrow, repay
and reborrow Swing Line Loans in accordance with the provisions, and subject to
the limitations, set forth herein (including the limitation set forth in Section
2.01).
(b) Each Swing Line Loan shall bear interest based on the
Transaction Rate. The aggregate principal amount of each Swing Line Borrowing
shall be not less than $250,000 or a greater integral multiple of $1,000. At no
time shall the number of Swing Line Borrowings outstanding under this Section
2.08 exceed three.
(c) Whenever Borrower desires to make a Swing Line Borrowing, it
shall give the Swing Line Lender (with a copy to the Agent) prior written notice
(or telephonic notice promptly confirmed in writing) of such Swing Line
Borrowing (each a "Swing Line Borrowing Notice") prior to 12:00 Noon. (local
time for the Swing Line Lender) on the date of such Swing Line Borrowing. Each
Swing Line Borrowing Notice shall specify the aggregate principal amount of the
Swing Line Borrowing, the date of such Swing Line Borrowing (which shall be a
Business Day) and the Interest Period requested to be applicable thereto. Prior
to 1:30 p.m. (local time for the Swing Line Lender) on such date, the Swing Line
Lender shall furnish Borrower (with a copy to the Agent) with a quotation of the
interest rate being offered with respect to such Swing Line Borrowing (whether
expressed as a fixed rate of interest in effect for the Interest Period
applicable thereto or as a floating rate of interest based on a specified
interest rate index and applicable margin for the Interest Period to be
applicable thereto; in either case, a "Transaction Rate Quote") by telephone
(promptly confirmed in writing) or by facsimile transmission. Borrower shall
immediately inform the Swing Line Lender (with a copy to the Agent) of its
decision as to whether to accept the Transaction Rate Quote and to confirm the
Swing Line Borrowing (which may be done by telephone, promptly confirmed in
writing, and which decision shall be irrevocable). If Borrower has so informed
the Swing Line Lender and confirmed the terms of the Swing Line Borrowing, then
no later than 3:00 p.m. (local time for the Swing Line Lender) on such date, the
Swing Line Lender shall make the principal amount of the Swing Line Loan
available to the Agent in immediately available funds at the Payment Office of
the Agent, and the Agent will make available to Borrower such amount by
crediting such amount to Borrower's demand deposit account maintained with the
Agent. In the event that the Swing Line Lender does not make such amount
available to the Agent at the time prescribed above, but such amount is received
later that day, such amount may be credited to Borrower in the manner described
in the preceding sentence on the next Business Day (with interest on such amount
to begin accruing hereunder on such next Business Day).
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(d) Borrower's obligations to pay the principal of, and interest
on, the Swing Line Loans shall be evidenced by the records of the Agent and the
Swing Line Lender and by the Swing Line Note payable to the Swing Line Lender
(or the assignor of such Swing Line Lender) completed in conformity with this
Agreement, and such records, absent manifest error, shall constitute prima facie
evidence of the amount owed by Borrower with respect to the Swing Line Loans.
(e) The outstanding principal amount under each Swing Line Loan
shall be due and payable in full (i) on the expiration of the Interest Period
applicable to such Swing Line Loan, and (ii) on the Maturity Date.
(f) At any time on the request of the Swing Line Lender, each
Lender other than the Swing Line Lender shall purchase a participating interest
in all outstanding Swing Line Loans in an amount equal to its Pro Rata Share of
such Swing Line Loans, and the Swing Line Lender shall furnish each Lender with
a certificate evidencing such participating interest. Such purchase shall be
made on the third Business Day after such request is made; provided, however,
that unless an Event of Default has occurred and is continuing on the date such
request is made, the purchase of a participating interest in any Swing Line Loan
shall not be required to be made until the expiration of the current Interest
Period in effect for such Swing Line Loan. On the date of such required
purchase, each Lender will immediately transfer to the Swing Line Lender, in
immediately available funds, the amount of its participation. Whenever, at any
time after the Swing Line Lender has received from any such Lender the funds for
its participating interest in a Swing Line Loan, the Agent or the Swing Line
Lender receives any payment on account thereof, the Agent or the Swing Line
Lender will distribute to such Lender its participating interest in such amount
(appropriately adjusted, in the case of interest payments, to reflect the period
of time during which such Lender's participating interest was outstanding and
funded); provided, however, that if such payment received by the Agent or the
Swing Line Lender is required to be returned, such Lender will return to the
Agent or the Swing Line Lender any portion thereof previously distributed by the
Agent or the Swing Line Lender to it. Each Lender's obligation to purchase such
participating interests shall be absolute and unconditional and shall not be
affected by any circumstance, including without limitation (i) any setoff,
counterclaim, recoupment, defense or other right that such Lender or any other
Person may have against the Lender requesting such purchase or any other Person
for any reason whatsoever, (ii) the occurrence or continuation of a Default or
an Event of Default or the termination of any of the Commitments, (iii) any
adverse change in the condition (financial or otherwise) of Borrower, any of its
Consolidated Subsidiaries, or any other Person, (iv) any breach of this
Agreement by Borrower or any other Lender, or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing;
provided, however, that no such obligation shall exist (A) to the extent that
the aggregate Swing Line Loans were advanced in excess of the Swing Line
Subcommitment then in effect, or (B) with respect to any Swing Line Loan where
the Swing Line Lender actually advanced to Borrower net proceeds from the Swing
Line Loan (and therefore was not refunding a previous Swing Line Loan) at a time
when (x) the Swing Line Lender had actual knowledge that an Event of Default had
occurred and then existed, and (y) the Required
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Lenders had not agreed to waive such Event of Default for purposes of funding
such Swing Line Loan.
SECTION 2.09. BID RATE LOANS. Subject to the terms and conditions
hereof, Borrower may request, and each Lender, in its sole discretion, may agree
to make Bid Rate Advances in accordance with the following procedure; provided,
that, at no time shall the sum of the outstanding principal amount of the Loans
plus the Letter of Credit Obligations exceed the sum of Commitments:
(a) In order to request Bid Rate Bids, Borrower shall telecopy to
the Agent a duly completed Bid Request in the form of Exhibit D attached hereto
(which may request not more than two Bid Rate Bids), to be received by the Agent
not later than 11:00 a.m. (local time for the Agent) on the Business Day of the
proposed Bid Rate Loan or Loans; provided that, such Bid Request shall not be
deemed to have been received by the Agent in a timely manner unless Borrower
shall also have notified the Agent by telephone (excluding voice mail
notification) of such Bid Request by the time specified above. A Bid Request
that does not conform substantially to the format of Exhibit D may be rejected
in the Agent's sole discretion, and the Agent shall notify Borrower of such
rejection by telecopy not later than 12:00 noon (Atlanta, Georgia time) on the
date of receipt. Such request shall in each case refer to this Agreement and
specify (i) the date of such Borrowing or Borrowings (which shall be a Business
Day) and (ii) the aggregate principal amount thereof which shall be in a minimum
principal amount of $2,000,000 and in integral multiples of $100,000, and (iii)
the Interest Period with respect thereto. Promptly after its receipt of a Bid
Request that is not rejected as aforesaid, the Agent shall invite by telecopy
(substantially in the form set forth in Exhibit E attached hereto) the Lenders
to bid, on the terms and conditions of this Agreement, to make Bid Rate Advances
pursuant to the Bid Request.
(b) Each Lender may, in its sole discretion, make one or more Bid
Rate Bids (but not more than two) to Borrower responsive to a Bid Request. Each
Bid Rate Bid by a Lender must be received by the Agent via telecopy,
substantially in the form of Exhibit F attached hereto, not later than 12:00
noon (local time for the Agent) on the Business Day of the proposed Bid Rate
Loan. Multiple bids (not to exceed two per Lender) will be accepted by the
Agent. Bid Rate Bids that do not conform substantially to the format of Exhibit
F may be rejected by the Agent acting in consultation with Borrower, and the
Agent shall notify the Lender making such nonconforming bid of such rejection as
soon as practicable. Each Bid Rate Bid shall refer to this Agreement and specify
(i) the principal amount (which may equal the entire principal amount of the Bid
Rate Loan requested by Borrower) of the Bid Rate Advance or Advances that the
Lender is willing to make to Borrower, (ii) the Bid Rate or Rates at which the
Lender is prepared to make the Bid Rate Advance or Advances, and (iii) the
Interest Period and the last day thereof. A Bid Rate Bid submitted by a Lender
pursuant to this paragraph (b) shall be irrevocable (absent manifest error).
(c) The Agent shall promptly notify Borrower by telecopy of all
the Bid Rate Bids made, the Bid Rate and the principal amount of each Bid Rate
Advance in respect of which a Bid Rate Bid was made and the identity of the
Lender that made each bid. The Agent shall send a
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copy of all Bid Rate Bids to Borrower for its records as soon as practicable
after completion of the bidding process set forth in this Section 2.09.
(d) Borrower may, in its sole and absolute discretion, subject
only to the provisions of this paragraph (d), accept or reject any Bid Rate Bid
referred to in paragraph (c) above. Borrower shall notify the Agent by
telephone, confirmed by telecopy in the form of a Bid Accept/Reject Letter,
whether and to what extent it has decided to accept or reject any of or all the
bids referred to in paragraph (c) above not later than 12:30 p.m. (local time
for the Agent) on the Business Day of the proposed Bid Loan; provided, however,
that (i) the failure by Borrower to give such notice shall be deemed to be a
rejection of all the bids referred to in paragraph (c) above, (ii) Borrower
shall not accept a bid for a specific Interest Period made at a particular Bid
Rate if Borrower has decided to reject a bid for the same Interest Period made
at a lower Bid Rate, (iii) the aggregate amount of the Bid Rate Bids accepted by
Borrower shall not exceed the principal amount specified in the Bid Request,
(iv) if Borrower shall accept a bid or bids made at a particular Bid Rate but
the amount of such bid or bids shall cause the total amount of bids to be
accepted by Borrower to exceed the amount specified in the Bid Request, then
Borrower shall accept a portion of such bid or bids in an amount equal to the
amount specified in the Bid Request less the amount of all other Bid Rate Bids
accepted with respect to such Bid Request, which acceptance, in the case of
multiple bids at the same Bid Rate, shall be made pro rata in accordance with
the amount of each such bid at such Bid Rate, and (v) except pursuant to clause
(iv) above, no bid shall be accepted for a Bid Rate Loan unless such Bid Rate
Loan is in a minimum principal amount of $2,000,000 and an integral multiple of
$100,000; provided further, however, that if a Bid Loan must be in an amount
less than $2,000,000 because of the provisions of clause (iv) above, such Bid
Loan may be for a minimum of $500,000 and an integral multiple of $100,000, and
in calculating the pro rata allocation of acceptances of portions of multiple
bids at a particular Bid Rate pursuant to clause (iv) the amounts shall be
rounded to integral multiples of $100,000 in a manner which shall be in the
discretion of Borrower. A notice given by Borrower pursuant to this paragraph
(d) shall be irrevocable.
(e) The Agent shall promptly notify each bidding Lender whether
or not its Bid Rate Bid has been accepted (and if so, in what amount and at what
Bid Rate) and shall notify each Lender as to the amount, Interest Period and Bid
Rate of each Bid Rate Bid accepted by Borrower by telecopy sent by the Agent,
and each successful bidder will thereupon become bound, subject to the other
applicable conditions hereof, to make the Bid Rate Loan in respect of which its
bid has been accepted.
(f) Borrower shall not submit a Bid Request more than two times
in any seven day period.
(g) If the Agent shall elect to submit a Bid Rate Bid in its
capacity as a Lender, it shall submit such bid directly to Borrower one half of
an hour earlier than the earliest time at
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which the other Lenders are required to submit their bids to the Agent pursuant
to paragraph (b) above.
(h) Each Lender participating in any Bid Rate Loan shall make its
Bid Rate Advance available to the Agent on the date specified in the Bid Request
at the time and in the manner and subject to the provisions specified in Section
3.02.
(i) The Bid Rate Advances of each Lender shall be evidenced by its
Bid Facility Note and shall be due and payable in full on the earlier to occur
of (x) the last day of the relevant Interest Period or (y) the Maturity Date,
unless sooner accelerated pursuant to Article VIII hereof.
ARTICLE III.
GENERAL LOAN AND LETTER OF CREDIT TERMS
SECTION 3.01. FUNDING NOTICES.
(a) (i) Whenever Borrower desires to obtain a Syndicated Loan
with respect to the Commitments (other than one resulting from a conversion or
continuation pursuant to Section 3.01(b)(i)), it shall give the Agent prior
written notice (or telephonic notice promptly confirmed in writing) of such
Borrowing (a "Notice of Borrowing"), such Notice of Borrowing to be given prior
to 11:00 AM (local time for the Agent) at its Payment Office (x) three Business
Days prior to the requested date of such Borrowing in the case of Eurodollar
Advances and Bid Rate Advances, and (y) on the date of such Borrowing (which
shall be a Business Day) in the case of a Borrowing consisting of Base Rate
Advances. Notices received after 11:00 AM shall be deemed received on the next
Business Day. Each Notice of Borrowing shall be irrevocable and shall specify
the aggregate principal amount of the Borrowing, the date of Borrowing (which
shall be a Business Day), and whether the Borrowing is to consist of Base Rate
Advances or Eurodollar Advances and (in the case of Eurodollar Advances) the
Interest Period to be applicable thereto.
(ii) Whenever Borrower desires to obtain a Swing Line
Loan, it shall notify the Swing Line Lender, with a copy to the Agent, in
accordance with the procedure set forth in Section 2.08 hereof.
(iii) Whenever Borrower desires to obtain a Bid Rate Loan,
it shall notify the Agent in accordance with the procedure set forth in Section
2.09 hereof.
(b) (i) Whenever Borrower desires to convert all or a portion
of an outstanding Borrowing under the Commitments, which Borrowing consists of
Base Rate Advances or Eurodollar Advances, into one or more Borrowings
consisting of Advances of another Type, or to continue outstanding a Borrowing
consisting of Eurodollar Advances for a new Interest Period, it shall give the
Agent at least three Business Days' prior written notice (or telephonic notice
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promptly confirmed in writing) of each such Borrowing to be converted into or
continued as Eurodollar Advances. Such notice (a "Notice of
Conversion/Continuation") shall be given prior to 11:00 AM (local time for the
Agent) on the date specified at the Payment Office of the Agent. Each such
Notice of Conversion/Continuation shall be irrevocable and shall specify the
aggregate principal amount of the Advances to be converted or continued, the
date of such conversion or continuation, whether the Advances are being
converted into or continued Eurodollar Advances and, if so, the Interest Period
applicable thereto. If, upon the expiration of any Interest Period in respect of
any Borrowing, Borrower shall have failed to deliver the Notice of
Conversion/Continuation, Borrower shall be deemed to have elected to convert or
continue such Borrowing to a Borrowing consisting of Base Rate Advances. So long
as any Default or Event of Default shall have occurred and be continuing, no
Borrowing may be converted into or continued as (upon expiration of the current
Interest Period) Eurodollar Advances unless the Agent and each of the Lenders
shall have otherwise consented in writing. No conversion of any Borrowing of
Eurodollar Advances shall be permitted except on the last day of the Interest
Period in respect thereof.
(ii) Upon the expiration of the applicable Interest Period
with respect to Swing Line Loans, Borrower shall repay such Loan in full in
accordance with the terms hereof.
(iii) Upon the expiration of the applicable Interest
Period with respect to Bid Rate Loans, Borrower shall repay such Loan in full in
accordance with the terms hereof.
(c) Without in any way limiting Borrower's obligation to confirm
in writing any telephonic notice, the Agent and the Swing Line Lender may act
without liability upon the basis of telephonic notice believed by the Agent or
the Swing Line Lender in good faith to be from Borrower prior to receipt of
written confirmation. In each such case, Borrower hereby waives the right to
dispute the Agent's or the Swing Line Lender's record of the terms of such
telephonic notice.
(d) The Agent shall promptly give each Lender notice by telephone
(confirmed in writing) or by telecopy or facsimile transmission of the matters
covered by the notices given to the Agent pursuant to this Section 3.01 with
respect to the Commitments.
SECTION 3.02. DISBURSEMENT OF FUNDS.
(a) No later than 1:00 PM (local time for the Agent) on the date
of each Syndicated Loan pursuant to the Commitments (other than one resulting
from a conversion or continuation pursuant to Section 3.01(b)(i)), each Lender
will make available its Pro Rata Share of such Syndicated Loan in immediately
available funds at the Payment Office of the Agent. The Agent will make
available to Borrower the aggregate of the amounts (if any) so made available by
the Lenders to the Agent in a timely manner by crediting such amounts to
Borrower's demand deposit account maintained with the Agent or at Borrower's
option, effecting a wire transfer of such amounts to an account specified by
Borrower, by the close of business on such Business Day. In the
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event that the Lenders do not make such amounts available to the Agent by the
time prescribed above, but such amount is received later that day, such amount
may be credited to Borrower in the manner described in the preceding sentence on
the next Business Day (with interest on such amount to begin accruing hereunder
on such next Business Day).
(b) No later than 1:00 P.M. (local time for the Agent) on the date
of each Bid Rate Loan, the Lenders participating in such Bid Rate Loan will make
available the amount of its Bid Rate Advance in immediately available funds at
the Payment Office of the Agent on the date of such Bid Rate Loan.
(c) Unless the Agent shall have been notified by any Lender prior
to the date of a Borrowing that such Lender does not intend to make available to
the Agent such Lender's portion of the Borrowing to be made on such date, the
Agent may assume that such Lender has made such amount available to the Agent on
such date and the Agent may make available to Borrower a corresponding amount.
If such corresponding amount is not in fact made available to the Agent by such
Lender on the date of Borrowing, the Agent shall be entitled to recover such
corresponding amount on demand from such Lender together with interest at the
Federal Funds Rate. If such Lender does not pay such corresponding amount
forthwith upon the Agent's demand therefor, the Agent shall promptly notify
Borrower, and Borrower shall immediately pay such corresponding amount to the
Agent together with interest at the rate specified for the Borrowing. Nothing in
this subsection shall be deemed to relieve any Lender from its obligation to
fund its Commitment or Bid Rate Loans hereunder or to prejudice any rights which
Borrower may have against any Lender as a result of any default by such Lender
hereunder.
(d) All Syndicated Loans under the Commitments shall be loaned by
the Lenders on the basis of their Pro Rata Share of the Commitments. All Bid
Rate Loans shall be loaned by the Lenders participating therein in accordance
with their respective pro rata shares thereof as determined in accordance with
Section 2.09 with respect to each Bid Loan. All Swing Line Loans shall be made
available by the Swing Line Lender in accordance with Section 2.08 with respect
to each Swing Line Loan. No Lender shall be responsible for any default by any
other Lender in its obligations hereunder, and each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to fund its Commitments or Bid Rate Loans hereunder.
SECTION 3.03. INTEREST.
(a) Borrower agrees to pay interest in respect of all unpaid
principal amounts of Syndicated Loans from the respective dates such principal
amounts were advanced to maturity (whether by acceleration, notice of prepayment
or otherwise) at rates per annum equal to the applicable rates indicated below:
(i) For Base Rate Advances--The Base Rate in effect from
time to time; or
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(ii) For Eurodollar Advances--The relevant Adjusted LIBO
Rate plus the Applicable Margin;
(b) Borrower agrees to pay interest in respect of all unpaid
principal amounts of the Swing Line Loans made to Borrower from the respective
dates such principal amounts were advanced to maturity (whether by acceleration,
notice of prepayment or otherwise) at the Transaction Rate established for such
Loan pursuant to Section 2.08;
(c) Borrower agrees to pay interest in respect of all unpaid
principal amounts of the Bid Rate Loans made to Borrower from the respective
dates such principal amounts were advanced to maturity (whether by acceleration,
notice of prepayment or otherwise) at the Bid Rate established for such Loan
pursuant to Section 2.09;
(d) Overdue principal and, to the extent not prohibited by
applicable law, overdue interest, in respect of the Loans, and all other overdue
amounts owing hereunder, shall bear interest from each date that such amounts
are overdue:
(i) in the case of overdue principal and interest with
respect to all Loans outstanding as Eurodollar Advances, Swing Line Loans and
Bid Rate Advances, at the rate otherwise applicable for the then-current
Interest Period plus an additional two percent (2.0%) per annum; thereafter at
the rate in effect for Base Rate Advances plus an additional two percent (2.0%)
per annum; and
(ii) in the case of overdue principal and interest with
respect to all other Loans outstanding as Base Rate Advances and all other
Obligations hereunder (other than Loans), at a rate equal to the applicable Base
Rate plus an additional two percent (2.0%) per annum;
(e) Interest on each Loan shall accrue from and including the date
of such Loan to but excluding the date of any repayment thereof; provided that,
if a Loan is repaid on the same day made, one day's interest shall be paid on
such Loan. Interest on all Base Rate Advances shall be payable quarterly in
arrears on the last calendar day of each calendar quarter of Borrower in each
year. Interest on all outstanding Eurodollar Advances, Swing Line Advances and
Bid Rate Advances shall be payable on the last day of each Interest Period
applicable thereto, and, in the case of Interest Periods in excess of three
months, on each day which occurs every 3 months, as the case may be, after the
initial date of such Interest Period. Notwithstanding the foregoing, interest on
all Loans shall be payable on any conversion of any Advances comprising such
Loans into Advances of another Type, prepayment (on the amount prepaid), at
maturity (whether by acceleration, notice of prepayment or otherwise) and, after
maturity, on demand; and
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(f) The Agent, upon determining the Adjusted LIBO Rate for any
Interest Period, shall promptly notify by telephone (confirmed in writing) or in
writing Borrower and the other Lenders. Any such determination shall, absent
manifest error, be final, conclusive and binding for all purposes.
SECTION 3.04. INTEREST PERIODS.
(a) In connection with the making or continuation of, or
conversion into, each Borrowing of Eurodollar Advances, Borrower shall select an
Interest Period to be applicable to such Eurodollar Advances, which Interest
Period shall be either a 1, 2, 3 or 6 month period.
(b) In connection with the making of each Bid Rate Loan, Borrower
shall request an Interest Period to be applicable thereto, which Interest Period
shall be for a minimum of seven (7) days and a maximum of one hundred and eighty
(180) days, which request may be accepted or rejected by the Lenders as provided
in Section 2.09 hereof.
(c) In connection with the making of each Swing Line Loan,
Borrower shall request an Interest Period to be applicable thereto, which
Interest Period shall be for a minimum of one (1) day and a maximum of thirty
(30) days, which request may be accepted or rejected by the Lenders as provided
in Section 2.08 hereof
(d) Notwithstanding paragraphs (a), (b) or (c) above:
(i) The initial Interest Period for any Borrowing of
Eurodollar Advances shall commence on the date of such Borrowing (including the
date of any conversion from a Borrowing consisting of Advances of another Type)
and each Interest Period occurring thereafter in respect of such Borrowing shall
commence on the day on which the next preceding Interest Period expires;
(ii) If any Interest Period would otherwise expire on a
day which is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period in respect of
Eurodollar Advances would otherwise expire on a day that is not a Business Day
but is a day of the month after which no further Business Day occurs in such
month, such Interest Period shall expire on the next preceding Business Day;
(iii) Any Interest Period in respect of Eurodollar Advances
which begins on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period shall, subject to part (iv)
below, expire on the last Business Day of such calendar month; and
(iv) No Interest Period with respect to the Loans shall
extend beyond the Maturity Date.
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SECTION 3.05. FEES.
(a) Borrower shall pay to the Agent, for the account of and
distribution of the respective Pro Rata Share to each Lender, a facility fee
(the "Facility Fee") for the period commencing on the Closing Date to and
including the Maturity Date, computed at a rate equal to the Applicable Facility
Percentage per annum multiplied by the average daily Commitments of the Lenders,
such fee being payable quarterly in arrears on the last day of each fiscal
quarter of Borrower and on the Maturity Date.
(b) Borrower agrees to pay to the Agent, for the account of the
Lenders, a letter of credit fee equal to the Applicable Margin applicable to
Eurodollar Advances multiplied by the daily average amount of Letter of Credit
Obligations (the "Letter of Credit Fee"). The Letter of Credit Fee shall be
payable by Borrower quarterly, in arrears, on the date which is the last day of
each fiscal quarter of Borrower, and on the Maturity Date.
(c) Borrower shall pay to the Agent such fees for its
administrative services in the respective amounts and on the dates as previously
agreed in writing by Borrower with the Agent.
SECTION 3.06. VOLUNTARY PREPAYMENTS OF BORROWINGS.
(a) Borrower may, at its option, prepay Borrowings consisting of
Base Rate Advances, Swing Line Loans, Eurodollar Advances and Bid Rate Advances
at any time in whole, or from time to time in part, in amounts aggregating
$1,000,000 or any greater integral multiple of $100,000, by paying the principal
amount to be prepaid together with interest accrued and unpaid thereon to the
date of prepayment, together with, in the case of Eurodollar Advances and Bid
Rate Advances, all compensation payments pursuant to Section 3.12 if such
prepayment is made on a date other than the last day of the Interest Period
applicable thereto. Each such optional prepayment shall be applied in accordance
with Section 3.06(c) below.
(b) Borrower shall give written notice (or telephonic notice
confirmed in writing) to the Agent of any intended prepayment of the Loans (x)
not less than three Business Days prior to any prepayment in the case of
prepayment of Eurodollar Advances and Bid Rate Advances and (y) by 11:00 a.m.
(local time for the Agent) on the date of prepayment of any Base Rate Advances
or Swing Line Advances. Such notice, once given, shall be irrevocable. Upon
receipt of such notice of prepayment, the Agent shall promptly notify each
Lender of the contents of such notice and of such Lender's share of such
prepayment (provided that notices of prepayments of Bid Rate Loans shall only be
given to the Lenders participating therein).
(c) Borrower, when providing notice of prepayment pursuant to
Section 3.06(b), may designate the Types of Advances and the specific Borrowing
or Borrowings which are to be prepaid provided that each prepayment made
pursuant to a single Borrowing shall be applied pro rata
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among the Advances comprising such Borrowing. In the absence of a designation by
Borrower, the Agent shall, subject to the foregoing, make such designation in
its sole discretion. All voluntary prepayments shall be applied to the payment
of interest on the Borrowings prepaid before application to principal.
SECTION 3.07. PAYMENTS, ETC.
(a) All payments under this Agreement and the other Credit
Documents shall be made without defense, set-off or counterclaim and, other than
as specifically provided herein and payments made in respect of Swing Line Loans
(as more particularly described in this clause (a)), shall be made to the Agent
at its Payment Office not later than 1:00 PM (local time for the Agent) on the
date when due and all payments hereunder shall be made in Dollars in immediately
available funds. All payments with respect to the Swing Line Loans shall be made
without defense, set-off or counterclaim to the Swing Line Lender no later than
1:00 PM (local time for the Swing Line Lender) on the date when due (with a
notification of such payment to the Agent) and shall be made in Dollars in
immediately available funds at the Swing Line Lender's Lending Office, as set
forth on the signature pages to this Agreement.
(b) (i) All such payments shall be made free and clear of and
without deduction or withholding for any Taxes in respect of this Agreement, the
Notes or other Credit Documents, or any payments of principal, interest, fees or
other amounts payable hereunder or thereunder (but excluding, except as provided
in paragraph (iii) hereof, any Taxes imposed on the overall net income of the
Lenders pursuant to the laws of the jurisdiction (national, state or local) in
which the principal executive office or appropriate Lending Office of such
Lender is located). If any such Taxes are so levied or imposed, Borrower agrees
(A) to pay the full amount of such Taxes, and such additional amounts as may be
necessary so that every net payment of all amounts due hereunder and under the
Notes and other Credit Documents, after withholding or deduction for or on
account of any such Taxes (including additional sums payable under this Section
3.07), will not be less than the full amount provided for herein had no such
deduction or withholding been required, (B) to make such withholding or
deduction and (C) to pay the full amount deducted to the relevant authority in
accordance with applicable law. Borrower will furnish to the Agent and each
Lender, within 30 days after the date the payment of any Taxes is due pursuant
to applicable law, certified copies of tax receipts evidencing such payment by
Borrower. Borrower will indemnify and hold harmless the Agent and each Lender
and reimburse the Agent and each Lender upon written request for the amount of
any such Taxes so levied or imposed and paid by the Agent or Lender and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes were correctly or illegally asserted.
A certificate as to the amount of such payment by such Lender or the Agent,
absent manifest error, shall be final, conclusive and binding for all purposes.
(ii) Each Lender that is organized under the laws of any
jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) agrees to furnish to Borrower and the
Agent, prior to the time it becomes a Lender hereunder, two copies
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of either U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue
Service Form 1001 or any successor forms thereto (wherein such Lender claims
entitlement to complete exemption from or reduced rate of U.S. Federal
withholding tax on interest paid by Borrower hereunder) and to provide to
Borrower and the Agent a new Form 4224 or Form 1001 or any successor forms
thereto if any previously delivered form is found to be incomplete or incorrect
in any material respect or upon the obsolescence of any previously delivered
form; provided, however, that no Lender shall be required to furnish a form
under this paragraph (ii) if it is not entitled to claim an exemption from or a
reduced rate of withholding under applicable law. A Lender that is not entitled
to claim an exemption from or a reduced rate of withholding under applicable
law, promptly upon written request of Borrower, shall so inform Borrower in
writing.
(iii) Borrower shall also reimburse the Agent and each
Lender, upon written request, for any Taxes imposed (including, without
limitation, Taxes imposed on the overall net income of the Agent or Lender or
its applicable Lending Office pursuant to the laws of the jurisdiction
(national, state or local) in which the principal executive office or the
applicable Lending Office of the Agent or Lender is located) as the Agent or
Lender shall determine are payable by the Agent or Lender in respect of amounts
paid by or on behalf of Borrower to or on behalf of the Agent or Lender pursuant
to paragraph (i) hereof.
(c) Subject to Section 3.04(d)(ii) and (iii), whenever any payment
to be made hereunder or under any Note shall be stated to be due on a day which
is not a Business Day, the due date thereof shall be extended to the next
succeeding Business Day and, with respect to payments of principal, interest
thereon shall be payable at the applicable rate during such extension.
(d) All computations of interest and fees shall be made on the
basis of a year of 360 days for the actual number of days (including the first
day but excluding the last day) occurring in the period for which such interest
or fees are payable (to the extent computed on the basis of days elapsed).
Interest on Base Rate Advances shall be calculated based on the Base Rate from
and including the date of such Loan to but excluding the date of the repayment
or conversion thereof. Interest on Eurodollar Advances and Bid Rate Advances
shall be calculated as to each Interest Period from and including the first day
thereof to but excluding the last day thereof. Each determination by the Agent
of an interest rate or fee hereunder shall be made in good faith and, except for
manifest error, shall be final, conclusive and binding for all purposes.
(e) Payment by Borrower to the Agent in accordance with the terms
of this Agreement shall, as to Borrower, constitute payment to the Lenders under
this Agreement.
SECTION 3.08. INTEREST RATE NOT ASCERTAINABLE, ETC. In the event that
the Agent shall have determined (which determination shall be made in good faith
and, absent manifest error, shall be final, conclusive and binding upon all
parties) that on any date for determining the Adjusted LIBO Rate for any
Interest Period, by reason of any changes arising after the date of this
Agreement
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affecting the London interbank market, adequate and fair means do not exist for
ascertaining the applicable interest rate on the basis provided for in the
definition of Adjusted LIBO Rate then, and in any such event, the Agent shall
forthwith give notice (by telephone confirmed in writing) to Borrower and to the
Lenders, of such determination and a summary of the basis for such
determination. Until the Agent notifies Borrower that the circumstances giving
rise to the suspension described herein no longer exist, the obligations of the
Lenders to make or permit portions of the Loans to remain outstanding past the
last day of the then current Interest Periods as Eurodollar Advances shall be
suspended, and such affected Advances shall bear interest at the Base Rate (or
at such other rate of interest per annum as Borrower and each of the Agent and
the Lenders shall have agreed to in writing).
SECTION 3.09. ILLEGALITY.
(a) In the event that any Lender shall have determined (which
determination shall be made in good faith and, absent manifest error, shall be
final, conclusive and binding upon all parties) at any time that the making or
continuance of any Eurodollar Advance has become unlawful by compliance by such
Lender in good faith with any applicable law, governmental rule, regulation,
guideline or order (whether or not having the force of law and whether or not
failure to comply therewith would be unlawful), then, in any such event, the
Lender shall give prompt notice (by telephone confirmed in writing) to Borrower
and to the Agent of such determination and a summary of the basis for such
determination (which notice the Agent shall promptly transmit to the other
Lenders).
(b) Upon the giving of the notice to Borrower referred to in
subsection (a) above, (i) Borrower's right to request and such Lender's
obligation to make Eurodollar Advances shall be immediately suspended, and such
Lender shall make an Advance as part of the requested Borrowing of Eurodollar
Advances, bearing interest at the Base Rate (or at such other rate of interest
per annum as Borrower and each of the Agent and the Lenders shall have agreed to
in writing), which Base Rate Advance shall, for all other purposes, be
considered part of such Borrowing, and (ii) if the affected Eurodollar Advance
or Advances are then outstanding, Borrower shall immediately, or if permitted by
applicable law, no later than the date permitted thereby, upon at least one
Business Day's written notice to the Agent and the affected Lender, convert each
such Advance into an Advance or Advances of a different Type with an Interest
Period ending on the date on which the Interest Period applicable to the
affected Eurodollar Advances expires, provided that if more than one Lender is
affected at any time, then all affected Lenders must be treated the same
pursuant to this Section 3.09(b).
(c) Notwithstanding any other provision contained in this
Agreement, the Agent shall not be obligated to issue any Letter of Credit, nor
shall any Lender be obligated to purchase its participation in any Letter of
Credit to be issued hereunder, if the issuance of such Letter of Credit or
purchase of such participation shall have become unlawful or prohibited by
compliance by Agent or such Lender in good faith with any law, governmental
rule, guideline, request, order, injunction, judgment or decree (whether or not
having the force of law); provided that in the case of the
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obligation of a Lender to purchase such participation, such Lender shall have
notified the Agent to such effect at least three (3) Business Days' prior to the
issuance thereof by the Agent, which notice shall relieve the Agent of its
obligation to issue such Letter of Credit pursuant to Section 2.04 and Section
2.05 hereof.
SECTION 3.10. INCREASED COSTS.
(a) (i) If, by reason of (x) after the date hereof, the
introduction of or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in or in the interpretation
of any law or regulation, or (y) the compliance with any guideline or request
from any central bank or other governmental authority or quasi-governmental
authority exercising control over banks or financial institutions generally
(whether or not having the force of law):
(1) any Lender (or its applicable Lending Office) shall
be subject to any tax, duty or other charge with respect to its
Eurodollar Advances, Letter of Credit Obligations or its obligation to
make Eurodollar Advances or to issue Letters of Credit, or the basis of
taxation of payments to any Lender of the principal of or interest on
its Eurodollar Advances, Letter of Credit Obligations or its obligation
to make Eurodollar Advances or to issue Letters of Credit shall have
changed (except for changes in the tax on the overall net income of
such Lender or its applicable Lending Office imposed by the
jurisdiction (national, state or local) in which such Lender's
principal executive office or applicable Lending Office is located); or
(2) any reserve (including, without limitation, any
imposed by the Board of Governors of the Federal Reserve System),
special deposit or similar requirement against assets of, deposits with
or for the account of, or credit extended by, any Lender's applicable
Lending Office shall be imposed or deemed applicable or any other
condition affecting its Eurodollar Advances, Letter of Credit
Obligations or its obligation to make Eurodollar Advances shall be
imposed on any Lender or its applicable Lending Office or the London
interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining Eurodollar Advances or
Letters of Credit (except to the extent already included in the determination of
the applicable Adjusted LIBO Rate), or there shall be a reduction in the amount
received or receivable by such Lender or its applicable Lending Office, or
(ii) in the event that any Lender shall have determined
that any law, treaty, governmental (or quasi-governmental) rule, regulation,
guideline or order regarding capital adequacy not currently in effect or fully
applicable as of the Closing Date, or any change therein or in the
interpretation or application thereof after the Closing Date, or compliance by
such Lender with any
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request or directive regarding capital adequacy not currently in effect or fully
applicable as of the Closing Date (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful) from a central
bank or governmental authority or body having jurisdiction, does or shall have
the effect of reducing the rate of return on such Lender's capital as a
consequence of its obligations hereunder to a level below that which such Lender
could have achieved but for such law, treaty, rule, regulation, guideline or
order, or such change or compliance (taking into consideration such Lender's
policies with respect to capital adequacy) by an amount deemed by such Lender to
be material;
then, in the case of (i) or (ii) above (subject, in the case of certain Taxes,
to the applicable provisions of Section 3.07(b)), upon written notice from and
demand by such Lender on Borrower (with a copy of such notice and demand to the
Agent), Borrower shall pay to the Agent for the account of such Lender within
five Business Days after the date of such notice and demand, additional amounts
sufficient to indemnify such Lender against such increased cost or reduced
yield. A certificate as to the amount of such increased cost or reduced yield
submitted to Borrower and the Agent by such Lender in good faith and accompanied
by a statement prepared by such Lender describing in reasonable detail the basis
for and calculation of such increased cost, shall, except for manifest error, be
final, conclusive and binding for all purposes.
(b) If any Lender shall advise the Agent that at any time, because
of the circumstances described in clauses (x) or (y) in Section 3.10(a) or any
other circumstances beyond such Lender's reasonable control arising after the
date of this Agreement affecting such Lender or the London interbank market or
such Lender's position in such markets, the Adjusted LIBO Rate as determined by
the Agent, will not adequately and fairly reflect the cost to such Lender of
funding its Eurodollar Advances, then, and in any such event:
(i) the Agent shall forthwith give notice (by telephone
confirmed in writing) to Borrower and to the other Lenders of such advice;
(ii) Borrower's right to request and such Lender's
obligation to make or permit portions of the Loans to remain outstanding past
the last day of the then current Interest Periods as Eurodollar Advances shall
be immediately suspended; and
(iii) such Lender shall make an Advance as part of the
requested Borrowing of Eurodollar Advances, as the case may be, bearing interest
at the Base Rate (or at such other rate of interest per annum as Borrower and
each of the Agent and the Lenders shall have agreed to in writing), which Base
Rate Advance shall, for all other purposes, be considered part of such
Borrowing.
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SECTION 3.11. LENDING OFFICES.
(a) Each Lender agrees that, if requested by Borrower, it will use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate an alternate Lending Office with respect to any of its Eurodollar
Advances affected by the matters or circumstances described in Sections 3.07(b),
3.08, 3.09 or 3.10 to reduce the liability of Borrower or avoid the results
provided thereunder, so long as such designation is not disadvantageous to such
Lender as determined by such Lender, which determination if made in good faith,
shall be conclusive and binding on all parties hereto. Nothing in this Section
3.11 shall affect or postpone any of the obligations of Borrower or any right of
any Lender provided hereunder.
(b) If any Lender that is organized under the laws of any
jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) issues a public announcement with respect
to the closing of its lending offices in the United States such that any
withholdings or deductions and additional payments with respect to Taxes may be
required to be made by Borrower thereafter pursuant to Section 3.07(b), such
Lender shall use reasonable efforts to furnish Borrower notice thereof as soon
as practicable thereafter; provided, however, that no delay or failure to
furnish such notice shall in any event release or discharge Borrower from its
obligations to such Lender pursuant to Section 3.07(b) or otherwise result in
any liability of such Lender.
SECTION 3.12. FUNDING LOSSES. Borrower shall compensate each Lender,
upon its written request to Borrower (which request shall set forth the basis
for requesting such amounts in reasonable detail and which request shall be made
in good faith and, absent manifest error, shall be final, conclusive and binding
upon all of the parties hereto), for all losses, expenses and liabilities
(including, without limitation, any interest paid by such Lender to lenders of
funds borrowed by it to make or carry its Eurodollar Advances or Bid Rate
Advances, in either case to the extent not recovered by such Lender in
connection with the re-employment of such funds but excluding any loss of
anticipated profits), which the Lender may sustain: (i) if for any reason (other
than a default by such Lender) a borrowing of, or conversion to or continuation
of, Eurodollar Advances or Bid Rate Advances to Borrower does not occur on the
date specified therefor in a Notice of Borrowing, Bid Request or Notice of
Conversion/Continuation, (whether or not withdrawn), or (ii) if any repayment
(including mandatory prepayments and any conversions pursuant to Section
3.09(b)) of any Eurodollar Advances or Bid Rate Advances by Borrower occurs on a
date which is not the last day of an Interest Period applicable thereto.
SECTION 3.13. ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR ADVANCES.
Calculation of all amounts payable to a Lender under this Article III shall be
made as though that Lender had actually funded its relevant Eurodollar Advances
through the purchase of deposits in the relevant market bearing interest at the
rate applicable to such Eurodollar Advances in an amount equal to the amount of
the Eurodollar Advances and having a maturity comparable to the relevant
Interest Period and through the transfer of such Eurodollar Advances from an
offshore office of that
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Lender to a domestic office of that Lender in the United States of America;
provided however, that each Lender may fund each of its Eurodollar Advances in
any manner it sees fit and the foregoing assumption shall be used only for
calculation of amounts payable under this Article III.
SECTION 3.14. APPORTIONMENT OF PAYMENTS. Aggregate principal and
interest payments in respect of Loans and payments in respect of Letter of
Credit Fees and Commitment Fees shall be apportioned among all outstanding
Commitments, Letter of Credit Obligations and Loans to which such payments
relate, proportionately to the Lenders' respective pro rata portions of such
Commitments and outstanding Loans and Letter of Credit Obligations; provided
that payments with respect to the Swing Line Loans shall be payable solely to
the Swing Line Lender and payments with respect to the Bid Rate Loans shall be
payable solely to the Lenders participating in such Loan. The Agent shall
promptly distribute to each Lender at its Payment Office set forth beside its
name on the appropriate signature page hereof or such other address as any
Lender may request its share of all such payments received by the Agent.
SECTION 3.15. SHARING OF PAYMENTS, ETC. If any Lender shall obtain any
payment or reduction (including, without limitation, any amounts received as
adequate protection of a deposit treated as cash collateral under the Bankruptcy
Code) of the Obligations (whether voluntary, involuntary, through the exercise
of any right of set-off, or otherwise) in excess of its pro rata portion of
payments or reductions on account of such obligations obtained by all the
Lenders (other than, prior to the termination of the Commitments, payments of
principal, interest and fees with respect to the Bid Rate Loans which are
payable solely to the Lenders participating therein and payments of the Swing
Line Loans which are payable solely to the Swing Line Lender), such Lender shall
forthwith (i) notify each of the other Lenders and Agent of such receipt, and
(ii) purchase from the other Lenders such participations in the affected
obligations as shall be necessary to cause such purchasing Lender to share the
excess payment or reduction, net of costs incurred in connection therewith,
ratably with each of them, provided that if all or any portion of such excess
payment or reduction is thereafter recovered from such purchasing Lender or
additional costs are incurred, the purchase shall be rescinded and the purchase
price restored to the extent of such recovery or such additional costs, but
without interest unless the Lender obligated to return such funds is required to
pay interest on such funds. Borrower agrees that any Lender so purchasing a
participation from another Lender pursuant to this Section 3.15 may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off) with respect to such participation as fully as if such
Lender were the direct creditor of Borrower in the amount of such participation.
SECTION 3.16. LETTER OF CREDIT OBLIGATIONS ABSOLUTE. The obligation of
Borrower to reimburse the Agent for drawings made under Letters of Credit issued
for the account of Borrower and the Lenders' obligation to honor their
participations purchased therein shall be unconditional and irrevocable and
shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including without limitation, the following circumstances:
(a) Any lack of validity or enforceability of any Letter of
Credit;
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(b) The existence of any claim, set-off, defense or other right
which Borrower or any Subsidiary or Affiliate of Borrower may have at any time
against a beneficiary or any transferee of any Letter of Credit (or any Persons
or entities for whom any such beneficiary or transferee may be acting), any
Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including without
limitation any underlying transaction between Borrower or any of its
Subsidiaries and Affiliates and the beneficiary for which such Letter of Credit
was procured); provided that nothing in this Section shall affect the right of
Borrower to seek relief against any beneficiary, transferee, Lender or any other
Person in any action or proceeding or to bring a counterclaim in any suit
involving such Persons;
(c) Any draft, demand, certificate or any other document presented
under any Letter of Credit proving to be forged, fraudulent or invalid in any
respect or any statement therein being untrue or inaccurate in any respect;
(d) Payment by the Agent under any Letter of Credit against
presentation of a demand, draft or certificate or other document which does not
comply with the terms of such Letter of Credit;
(e) Any other circumstance or happening whatsoever which is
similar to any of the foregoing; or
(f) the fact that a Default or an Event of Default shall have
occurred and be continuing.
Nothing in this Section 3.16 shall prevent an action against the Agent for its
gross negligence or willful misconduct in honoring drafts under the Letters of
Credit.
ARTICLE IV.
CONDITIONS TO BORROWINGS
The obligations of each Lender to make Advances to Borrower and the
obligation of the Agent to issue Letters of Credit for the account of Borrower
hereunder is subject to the satisfaction of the following conditions:
SECTION 4.01. CONDITIONS PRECEDENT TO INITIAL LOANS AND LETTERS OF
CREDIT. On the Closing Date, all obligations of Borrower hereunder incurred
prior to such date (including, without limitation, Borrower's obligations to
reimburse the reasonable fees and expenses of counsel to the Agent and any fees
and expenses payable to the Agent, the Co-Agents, the Lenders and their
Affiliates as previously agreed with Borrower), shall have been paid in full,
and the Agent shall have received the following, in form and substance
reasonably satisfactory in all respects to the Agent:
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(a) the duly executed counterparts of this Agreement;
(b) the duly executed Revolving Credit Notes evidencing the
Commitments and the duly executed Bid Facility Notes and the duly executed Swing
Line Note evidencing the Swing Line Subcommitment;
(c) the duly executed Guaranty Agreement;
(d) certificate of Borrower in substantially the form of Exhibit I
attached hereto and appropriately completed;
(e) certificates of the Secretary or Assistant Secretary of each
of the Credit Parties attaching and certifying copies of the resolutions of the
boards of directors of the Credit Parties, authorizing as applicable the
execution, delivery and performance of the Credit Documents;
(f) certificates of the Secretary or an Assistant Secretary of
each of the Credit Parties certifying (i) the name, title and true signature of
each officer of such entities executing the Credit Documents, and (ii) the
bylaws or comparable governing documents of such entities;
(g) certified copies of the certificate or articles of
incorporation of each Credit Party certified by the Secretary of State or the
Secretary or Assistant Secretary of such Credit Party, together with
certificates of good standing or existence, as may be available from the
Secretary of State of the jurisdiction of incorporation or organization of such
Credit Party;
(h) copies of all documents and instruments, including all
consents, authorizations and filings, required or advisable under any
Requirement of Law or by any material Contractual Obligation of the Credit
Parties, in connection with the execution, delivery, performance, validity and
enforceability of the Credit Documents and the other documents to be executed
and delivered hereunder, and such consents, authorizations, filings and orders
shall be in full force and effect and all applicable waiting periods shall have
expired;
(i) certificates, reports and other information as the Agent may
reasonably request from any Consolidated Company in order to satisfy the Lenders
as to the absence of any material liabilities or obligations arising from (i)
litigation (including without limitation, products liability and patent
infringement claims) pending or threatened against the Consolidated Companies,
(ii) matters relating to employees of the Consolidated Companies, including
employee relations, collective bargaining agreements, plans and other
compensation and employee benefit plans, and (iii) environmental and employee
health and safety exposures to which the Consolidated Companies may be subject,
and the plans of the Consolidated Companies with respect thereto;
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(j) the favorable opinion of Xxxxx, Xxxxxxxx & Xxxxxxx, counsel to
the Credit Parties, substantially in the form of Exhibit J addressed to the
Agent, the Co-Agents and each of the Lenders; and
(k) all corporate proceedings and all other legal matters in
connection with the authorization, legality, validity and enforceability of the
Credit Documents shall be reasonably satisfactory in form and substance to the
Required Lenders.
SECTION 4.02. CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT. At the
time of the making of all Loans and the issuance of any Letter of Credit (before
as well as after giving effect to such Loans or Letters of Credit and to the
proposed use of the proceeds thereof), the following conditions shall have been
satisfied or shall exist:
(a) there shall exist no Default or Event of Default;
(b) all representations and warranties by Borrower contained
herein shall be true and correct in all material respects with the same effect
as though such representations and warranties had been made on and as of the
date of such Loans other than those made as of a specific date;
(c) the aggregate amount of all outstanding Loans and Letter of
Credit Obligations shall not exceed the aggregate amount of the Commitments;
(d) since the date of the most recent financial statements of the
Consolidated Companies described in Section 5.13, there shall have been no
change which has had or could reasonably be expected to have a Materially
Adverse Effect (whether or not any notice with respect to such change has been
furnished to the Lenders pursuant to Section 6.09); provided that, this
condition shall not apply with respect to any Loan or Letter of Credit which
does not increase the aggregate amount of the Obligations outstanding under the
Commitments;
(e) there shall be no action or proceeding instituted or pending
before any court or other governmental authority or, to the knowledge of
Borrower, threatened (i) which reasonably could be expected to have a Materially
Adverse Effect, or (ii) seeking to prohibit or restrict one or more Credit
Party's ownership or operation of any portion of its business or assets, or to
compel one or more Credit Party to dispose of or hold separate all or any
portion of its businesses or assets, where such portion or portions of such
business(es) or assets, as the case may be, constitute a material portion of the
total businesses or assets of the Consolidated Companies; provided that, this
condition shall not apply with respect to any Loan or Letter of Credit which
does not increase the aggregate amount of the Obligations outstanding under the
Commitments; and
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(f) the Loans to be made and the use of proceeds thereof or the
Letters of Credit to be issued, as the case may be, shall not contravene,
violate or conflict with, or involve the Agent or any Lender in a violation of,
any law, rule, injunction, or regulation, or determination of any court of law
or other governmental authority applicable to Borrower.
Each request for a Borrowing and the acceptance by Borrower of the
proceeds thereof and each request for the issuance of a Letter of Credit shall
constitute a representation and warranty by Borrower, as of the date of the
Loans comprising such Borrowing or the date of the issuance of such Letter of
Credit, that the applicable conditions specified in Sections 4.01 and 4.02 have
been satisfied or waived in writing.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Borrower (as to itself and all other Consolidated Companies) represents
and warrants as follows:
SECTION 5.01. CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Except as set
forth on Schedule 5.01(a), each of the Consolidated Companies is a corporation
duly organized, validly existing, and in good standing under the laws of the
jurisdiction of its incorporation. Each of the Consolidated Companies (i) has
the corporate power and authority and the legal right to own and operate its
property and to conduct its business, (ii) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where
failure to conduct business would have a Materially Adverse Effect, and (iii) is
in compliance with all Requirements of Law, except where the failure to duly
qualify or to comply with applicable Requirements of Law would not have a
Materially Adverse Effect. The jurisdiction of incorporation or organization,
and the ownership of all issued and outstanding capital stock, for each
Subsidiary as of the date of this Agreement is accurately described on Schedule
5.01(b).
SECTION 5.02. CORPORATE POWER; AUTHORIZATION. Each of the Credit
Parties has the corporate power and authority to make, deliver and perform the
Credit Documents to which it is a party and has taken all necessary corporate
action to authorize the execution, delivery and performance of such Credit
Documents. No consent or authorization of, or filing with, any Person
(including, without limitation, any governmental authority), is required in
connection with the execution, delivery or performance by any Credit Party, or
the validity or enforceability against any Credit Party, of the Credit
Documents, other than such consents, authorizations or filings which have been
made or obtained (other than routine filings with the Securities and Exchange
Commission).
SECTION 5.03. ENFORCEABLE OBLIGATIONS. This Agreement has been duly
executed and delivered, and each other Credit Document will be duly executed and
delivered, by the respective Credit Parties, and this Agreement constitutes, and
each other Credit Document when
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executed and delivered will constitute, legal, valid and binding obligations of
the Credit Parties, respectively, enforceable against the Credit Parties in
accordance with their respective terms, except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting
the enforcement of creditors' rights generally and by general principles of
equity.
SECTION 5.04. NO LEGAL BAR. The execution, delivery and performance by
the Credit Parties of the Credit Documents will not violate any Requirement of
Law or cause a breach or default under any of their respective Contractual
Obligations.
SECTION 5.05. NO MATERIAL LITIGATION OR INVESTIGATIONS. Except as set
forth on Schedule 5.05 or in any notice furnished to the Lenders pursuant to
Section 6.09(g) at or prior to the respective times the representations and
warranties set forth in this Section 5.05 are made or deemed to be made
hereunder, no litigation, investigations or proceedings of or before any courts,
tribunals, arbitrators or governmental authorities are pending or, to the
knowledge of Borrower, threatened by or against any of the Consolidated
Companies, or against any of their respective properties or revenues, existing
or future (a) with respect to any Credit Document, or any of the transactions
contemplated hereby or thereby, or (b) which, if adversely determined, would
reasonably be expected to have a Materially Adverse Effect.
SECTION 5.06. INVESTMENT COMPANY ACT, ETC. None of the Consolidated
Companies is an "investment company" or a company "controlled" by an "investment
company" (as each of the quoted terms is defined or used in the Investment
Company Act of 1940, as amended). None of the Consolidated Companies is subject
to regulation under the Public Utility Holding Company Act of 1935, the Federal
Power Act, or any foreign, federal or local statute or regulation limiting its
ability to incur indebtedness for money borrowed, guarantee such indebtedness,
or pledge its assets to secure such indebtedness, as contemplated hereby or by
any other Credit Document.
SECTION 5.07. MARGIN REGULATIONS. No part of the proceeds of any of the
Loans will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the applicable Margin
Regulations.
SECTION 5.08. COMPLIANCE WITH ENVIRONMENTAL LAWS.
(a) Except as set forth on Schedule 5.08 attached hereto, the
Consolidated Companies have received no notices of claims or potential liability
under, and are in compliance with, all applicable Environmental Laws, where such
claims and liabilities under, and failures to comply with, such statutes,
regulations, rules, ordinances, laws or licenses, would reasonably be expected
to result in penalties, fines, claims or other liabilities to the Consolidated
Companies in amounts in excess of five percent (5%) of Consolidated Net Worth,
either individually or in the aggregate.
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(b) Except as set forth on Schedule 5.08 attached hereto, none of
the Consolidated Companies has received any notice of violation, or notice of
any action, either judicial or administrative, from any governmental authority
(whether United States or foreign) relating to the actual or alleged violation
of any Environmental Law, including, without limitation, any notice of any
actual or alleged spill, leak, or other release of any Hazardous Substance,
waste or hazardous waste by any Consolidated Company or its employees or agents,
or as to the existence of any contamination on any properties owned by any
Consolidated Company, where any such violation, spill, leak, release or
contamination would reasonably be expected to result in penalties, fines, claims
or other liabilities to the Consolidated Companies in amounts in excess of five
percent (5%) of Consolidated Net Worth, either individually or in the aggregate.
(c) Except as set forth on Schedule 5.08 attached hereto, the
Consolidated Companies have obtained all necessary governmental permits,
licenses and approvals which are material to the operations conducted on their
respective properties, including without limitation, all required material
permits, licenses and approvals for (i) the emission of air pollutants or
contaminants, (ii) the treatment or pretreatment and discharge of waste water or
storm water, (iii) the treatment, storage, disposal or generation of hazardous
wastes, (iv) the withdrawal and usage of ground water or surface water, and (v)
the disposal of solid wastes.
SECTION 5.09. INSURANCE. The Consolidated Companies currently maintain
insurance with respect to their respective properties and businesses, with
financially sound and reputable insurers, having coverages against losses or
damages of the kinds customarily insured against by reputable companies in the
same or similar businesses, such insurance being in amounts no less than those
amounts which are customary for such companies under similar circumstances. The
Consolidated Companies have paid all material amounts of insurance premiums now
due and owing with respect to such insurance policies and coverages, and such
policies and coverages are in full force and effect.
SECTION 5.10. NO DEFAULT. None of the Consolidated Companies is in
default under or with respect to any Contractual Obligation in any respect which
is having or is reasonably expected to have a Materially Adverse Effect.
SECTION 5.11. TAXES. Except as set forth on Schedule 5.11, each of the
Consolidated Companies has filed or caused to be filed all declarations, reports
and tax returns which are required to have been filed, and has paid all taxes,
custom duties, levies, charges and similar contributions ("taxes" in this
Section 5.11) shown to be due and payable on said returns or on any assessments
made against it or its properties, and all other taxes, fees or other charges
imposed on it or any of its properties by any governmental authority (other than
those the amount or validity of which is currently being contested in good faith
by appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided in its books); and no tax liens have been filed and, to
the knowledge of Borrower, no claims are being asserted with respect to any such
taxes, fees or other charges.
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SECTION 5.12. SUBSIDIARIES. Except as disclosed on Schedule 5.01(b) or
in any notice given to the Lenders pursuant to Section 6.09(h) at or prior to
the respective times this representation and warranty is made or deemed to be
made hereunder, Borrower has no Subsidiaries and neither Borrower nor any
Subsidiary is a joint venture partner or general partner in any partnership.
SECTION 5.13. FINANCIAL STATEMENTS. Borrower has furnished to the Agent
and the Lenders the audited consolidated balance sheet as of December 31, 1997
of Borrower and the related consolidated statements of income, shareholders'
equity and cash flows for the fiscal year then ended, including in each case the
related schedules and notes. The foregoing financial statements fairly present
in all material respects the consolidated financial condition of Borrower as at
the date thereof and results of operations for such periods in conformity with
GAAP consistently applied. The Consolidated Companies taken as a whole do not
have any material contingent obligations, contingent liabilities, or material
liabilities for known taxes, long-term leases or unusual forward or long-term
commitments not reflected in the foregoing financial statements or the notes
thereto. As of the Closing Date, since December 31, 1997, there have been no
changes with respect to the Consolidated Companies which has had or would
reasonably be expected to have a Materially Adverse Effect.
SECTION 5.14. ERISA. Except as disclosed on Schedule 5.14 or in any
notice furnished to the Lenders pursuant to Section 6.09(g) at or prior to the
respective times the representations and warranties set forth in this Section
5.14 are made or deemed to be made hereunder:
(a) Identification of Plans. None of the Consolidated Companies
nor any of their respective ERISA Affiliates maintains or contributes to, or has
during the past two years maintained or contributed to, any Plan that is subject
to Title IV of ERISA;
(b) Compliance. Each Plan maintained by the Consolidated Companies
has at all times been maintained, by its terms and in operation, in compliance
with all applicable laws, and the Consolidated Companies are subject to no tax
or penalty with respect to any Plan of such Consolidated Company or any ERISA
Affiliate thereof, including without limitation, any tax or penalty under Title
I or Title IV of ERISA or under Chapter 43 of the Tax Code, or any tax or
penalty resulting from a loss of deduction under Sections 404, or 419 of the Tax
Code, where the failure to comply with such laws, and such taxes and penalties,
together with all other liabilities referred to in this Section 5.14 (taken as a
whole), would in the aggregate have a Materially Adverse Effect;
(c) Liabilities. The Consolidated Companies are subject to no
liabilities (including withdrawal liabilities) with respect to any Plans of such
Consolidated Companies or any of their ERISA Affiliates, including without
limitation, any liabilities arising from Titles I or IV of ERISA, other than
obligations to fund benefits under an ongoing Plan and to pay current
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contributions, expenses and premiums with respect to such Plans, where such
liabilities, together with all other liabilities referred to in this Section
5.14 (taken as a whole), would in the aggregate have a Materially Adverse
Effect;
(d) Funding. The Consolidated Companies and, with respect to any
Plan which is subject to Title IV of ERISA, each of their respective ERISA
Affiliates, have made full and timely payment of all amounts (1) required to be
contributed under the terms of each Plan and applicable law, and (2) required to
be paid as expenses (including PBGC or other premiums) of each Plan, where the
failure to pay such amounts (when taken as a whole, including any penalties
attributable to such amounts) would have a Materially Adverse Effect. No Plan
subject to Title IV of ERISA has an "amount of unfunded benefit liabilities" (as
defined in Section 4001(a)(18) of ERISA), determined as if such Plan terminated
on any date on which this representation and warranty is deemed made, in any
amount which, together with all other liabilities referred to in this Section
5.14 (taken as a whole), would have a Materially Adverse Effect if such amount
were then due and payable. The Consolidated Companies are subject to no
liabilities with respect to post-retirement medical benefits in any amounts
which, together with all other liabilities referred to in this Section 5.14
(taken as a whole), would have a Materially Adverse Effect if such amounts were
then due and payable.
SECTION 5.15. PATENTS, TRADEMARKS, LICENSES, ETC. Except as set forth
on Schedule 5.15 or in any notice furnished to the Lenders pursuant to Section
6.09(i) at or prior to the respective times the representations and warranties
set forth in this Section 5.15 are made or deemed to be made hereunder, (i) the
Consolidated Companies have obtained and hold in full force and effect all
material patents, trademarks, service marks, trade names, copyrights, licenses
and other such rights, free from burdensome restrictions, which are necessary
for the operation of their respective businesses as presently conducted, and
(ii) to the best of Borrower's knowledge, no product, process, method, service
or other item presently sold by or employed by any Consolidated Company in
connection with such business infringes any patents, trademark, service xxxx,
trade name, copyright, license or other right owned by any other person and
there is not presently pending, or to the knowledge of Borrower, threatened, any
claim or litigation against or affecting any Consolidated Company contesting
such Person's right to sell or use any such product, process, method, substance
or other item where the result of such failure to obtain and hold such benefits
or such infringement would have a Materially Adverse Effect.
SECTION 5.16. OWNERSHIP OF PROPERTY. Except as set forth on Schedule
5.16, each Consolidated Company has good and marketable fee simple title to or a
valid leasehold interest in all of its real property and good title to, or a
valid leasehold interest in, all of its other property, as such properties are
reflected in the consolidated balance sheet of the Consolidated Companies as of
December 31, 1997 referred to in Section 5.13, other than properties disposed of
in the ordinary course of business since such date or as otherwise permitted by
the terms of this Agreement, subject to no Lien or title defect of any kind,
except Liens permitted hereby and title defects not constituting material
impairments in the intended use for such properties. The Consolidated Companies
enjoy peaceful and undisturbed possession under all of their respective leases.
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SECTION 5.17. FINANCIAL CONDITION. On the Closing Date and after giving
effect to the transactions contemplated by this Agreement and the other Credit
Documents, including without limitation, the use of the proceeds of the Loans as
provided in Section 2.01, each of the Credit Parties is Solvent.
SECTION 5.18. LABOR MATTERS. Since December 31, 1997, the Consolidated
Companies have experienced no strikes, labor disputes, slow downs or work
stoppages due to labor disagreements which have had, or would reasonably be
expected to have, a Materially Adverse Effect, and, to the best knowledge of
Borrower, there are no such strikes, disputes, slow downs or work stoppages
threatened against any Consolidated Company which if they occurred, would
reasonably be expected to have a Materially Adverse Effect. The hours worked and
payment made to employees of the Consolidated Companies have not been in
violation in any material respect of the Fair Labor Standards Act or any other
applicable law dealing with such matters. All payments due from the Consolidated
Companies, or for which any claim may be made against the Consolidated
Companies, on account of wages and employee health and welfare insurance and
other benefits have been paid or accrued as liabilities on the books of the
Consolidated Companies in all jurisdictions where the failure to pay or accrue
such liabilities would reasonably be expected to exceed five percent (5%) of
Consolidated Net Worth of Borrower in the aggregate.
SECTION 5.19. PAYMENT OR DIVIDEND RESTRICTIONS. Except as set forth in
Section 7.04 or described on Schedule 5.19 or as expressly permitted by the
terms of this Agreement, none of the Consolidated Companies is party to or
subject to any agreement or understanding restricting or limiting the payment of
any dividends or other distributions by any such Consolidated Company.
SECTION 5.20. DISCLOSURE. No representation or warranty contained in
this Agreement (including the Schedules attached hereto) or in any other
document furnished from time to time pursuant to the terms of this Agreement,
contains or will contain any untrue statement of a material fact or omits or
will omit to state any material fact necessary to make the statements herein or
therein not misleading in any material respect as of the date made or deemed to
be made. Except as may be set forth herein (including the Schedules attached
hereto) or in any notice furnished to the Lenders pursuant to Section 6.09 at or
prior to the respective times the representations and warranties set forth in
this Section 5.20 are made or deemed to be made hereunder, there is no fact
known to Borrower which is having, or is reasonably expected to have, based on
facts and circumstances known to Borrower on the date that this representation
is made or deemed to have been made, a Materially Adverse Effect.
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ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any Note shall
remain unpaid or any Letter of Credit shall remain outstanding, Borrower will
(unless waived in writing by the Required Lenders):
SECTION 6.01. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. (a) Do or
cause to be done all things necessary to preserve and maintain, and cause each
of its Subsidiaries to preserve and maintain, its respective corporate existence
(except as otherwise permitted pursuant to Section 7.02(c) hereof), its material
rights, franchises, and licenses, and its material patents and copyrights (for
the scheduled duration thereof), trademarks, trade names, and servicemarks,
necessary or desirable in the normal conduct of its business, (b) cause its
properties and the properties of its Subsidiaries used or useful in the conduct
of their respective businesses to be maintained and kept in good condition,
repair and working order and supplied with all necessary equipment and cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereto, all as in the judgment of the Borrower may be necessary so
that the businesses carried on in connection therewith may be properly conducted
at all times and (c) qualify and remain qualified, and cause each of its
Subsidiaries to qualify and remain qualified, to conduct business in each
jurisdiction where the nature of the business or ownership of property by the
Borrower, or such Subsidiary, as the case may be, may legally require such
qualification, except where the failure to comply with subsections (b) or (c)
above could not have a Materially Adverse Effect, or which in any manner draws
into question the validity or enforceability of the Credit Documents.
SECTION 6.02. COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, with all applicable federal, state, and local laws,
rules, regulations and orders, including, without limitation, all Environmental
Laws, ERISA and any other employee benefit laws, except where the failure to
comply could not have a Materially Adverse Effect, or which in any manner draws
into question the validity or enforceability of the Credit Documents.
SECTION 6.03. TAXES AND CLAIMS. Pay and discharge, and cause each of
its Subsidiaries to pay and discharge, or cause to be paid and discharged, (a)
before the same shall become delinquent, all taxes, assessments and other
governmental charges levied or imposed upon it or upon its income, profits or
properties and (b) all claims (including, without limitation, claims for labor,
materials, supplies or services) which might, if unpaid, become a Lien upon any
of its properties; provided, that in each case, neither the Borrower nor any
Subsidiary shall be required to pay or discharge, or cause to be paid or
discharged, any such tax, assessment, charge or claim whose amount or validity
is being contested in good faith by appropriate proceedings and with respect to
which adequate reserves are being maintained; provided, further, that the
Borrower shall, and shall cause each Subsidiary to, pay all such taxes,
assessments, charges and claims forthwith upon the commencement of proceedings
to foreclose any Lien which may have attached as security therefor.
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SECTION 6.04. COMPLIANCE WITH OTHER AGREEMENTS. Conduct, and cause each
Subsidiary to conduct, its business operations and obtain all necessary permits
and licenses in compliance with all agreements, indentures and mortgages to
which it is a party or by which it or any of its properties is bound, except
where the failure to comply could not have a Materially Adverse Effect, or which
in any manner draws into question the validity or enforceability of the Credit
Documents.
SECTION 6.05. INSPECTION OF PROPERTY. Permit any Person designated in
writing by the Agent or any Lender, at the Agent's or such Lender's expense, to
visit and inspect any of the properties of the Borrower or any Subsidiary, to
examine the corporate books and financial records of the Borrower and its
Subsidiaries and make copies thereof and take extracts therefrom, and to discuss
the affairs, finances and accounts of any of such corporations with the
principal officers of the Borrower or any Subsidiary and its independent public
accountants, all at such reasonable times and as often as the Agent or any
Lender may reasonably request.
SECTION 6.06. INSURANCE. Maintain, and cause each Subsidiary to
maintain, with financially sound and reputable carriers insurance in such
amounts and against such liabilities and hazards as customarily is maintained by
the Borrower and acceptable to the Required Lenders in its reasonable discretion
with any change in such amounts or hazards to be promptly submitted to the
Required Lenders for written approval which approval shall not be unreasonably
withheld; provided, that the Borrower and each Subsidiary may, to the extent
permitted by applicable law, maintain a system or systems of self-insurance
covering potential liabilities for workers' compensation.
SECTION 6.07. BUSINESS. Remain, and cause each Subsidiary to remain,
substantially in the respective business in which the Borrower and each such
Subsidiary is engaged as of the date of this Agreement, except as otherwise
permitted pursuant to Section 7.02(f) hereof.
SECTION 6.08. KEEPING OF BOOKS. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, containing complete
and accurate entries of all financial and business transactions of the Borrower
and each Subsidiary.
SECTION 6.09. REPORTING COVENANTS. Deliver to each Lender:
(a) as soon as practicable and in any event within forty-five (45)
days after the end of each quarterly period (other than the last quarterly
period) in each fiscal year, consolidating and consolidated statements of
income, stockholders' equity and cash flows of the Borrower and its Subsidiaries
for the period from the beginning of the current fiscal year to the end of such
quarterly period, and consolidating and consolidated balance sheets of the
Borrower and its Subsidiaries as at the end of such quarterly period, setting
forth in each case in comparative form figures for the corresponding period in
the preceding fiscal year (or in the case of the balance sheet figures from
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the preceding annual audit), all in reasonable detail and certified by a
Responsible Officer as fairly presenting, in all material respects, the
financial condition of the Borrower and its Subsidiaries as of the end of such
period and the results of their operations and of their cash flows for the
period then ended in accordance with GAAP, subject to changes resulting from
normal year-end adjustments and the inclusion of abbreviated footnotes;
provided, that in lieu of such statements, the Borrower may, pursuant to clause
(d) below, deliver copies of the Borrower's Quarterly Report on Form 10-Q for
such quarterly period filed with the Securities and Exchange Commission.
(b) as soon as practicable and in any event within ninety (90)
days after the end of each fiscal year, consolidating and consolidated
statements of income, stockholders' equity and cash flows of the Borrower and
its Subsidiaries for such year, and consolidating and consolidated balance
sheets of the Borrower and its Subsidiaries as at the end of such year, setting
forth in each case in comparative form corresponding consolidated figures from
the preceding annual audit, all in reasonable detail and satisfactory in scope
to the Required Lenders and, as to the consolidated statements, reported on by
independent public accounts of recognized standing selected by the Borrower
whose report shall be without limitation as to the scope of the audit and
reasonably satisfactory in substance to the Required Lenders and, as to the
consolidating statements, certified by a Responsible Officer; provided, that in
lieu of delivering the audited consolidated statements the Borrower may, under
clause (d) below, deliver copies of the Borrower's Annual Report on Form 10-K
for such year filed with the Securities and Exchange Commission;
(c) together with the financial statements required pursuant to
subsections (a) and (b) above (or delivered pursuant to subsection (d) in lieu
thereof), a certificate substantially in the form of Exhibit L attached hereto
of the Chief Financial Officer of Borrower to the effect that, (i) based upon a
review of the activities of the Consolidated Companies and such financial
statements during the period covered thereby, there exists no Event of Default
and no Default under this Agreement, or if there exists an Event of Default or a
Default hereunder, specifying the nature thereof and the proposed response
thereto, (ii) to the best of his or her knowledge, the financial statements are
true and correct, (iii) with respect to each of the financial statements
provided pursuant to Section 6.09(a), that such financial statements were
prepared in accordance with GAAP, subject, in the case of quarterly financial
statements, to changes resulting from normal year-end adjustments and the
inclusion of abbreviated footnotes, and (iv) setting forth in reasonable detail
the calculations required to establish whether the Borrower was in compliance
with the requirements of Section 7.01 hereof on the date of such financial
statements;
(d) promptly upon transmission thereof, copies of all such
financial statements, proxy statements, notices and reports as it shall send to
its stockholders and copies of all registration statements (without exhibits)
and all reports which it files with the Securities and Exchange Commission (or
any governmental body or agency succeeding to the functions of the Securities
and Exchange Commission);
(e) promptly upon request therefor, a copy of each other report
(including without limitation management letters) submitted to the Borrower or
any Subsidiary by independent
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accountants in connection with any annual, interim or special audit made by them
of the books of the Borrower or any Subsidiary;
(f) simultaneously with the delivery of the financial statements
referred to in clause (b) above, a certificate of the firm of independent public
accountants which reported on such statements stating whether, in the course of
making the audit necessary for such report, it obtained knowledge of any Default
or Event of Default and if it did obtain such knowledge, setting forth the
details thereof; provided, that such firm of independent public accountants
shall not be liable to any Person if it did not obtain such knowledge which
would not be disclosed in the course of an audit conducted under generally
accepted auditing standards;
(g) forthwith upon any Responsible Officer obtaining knowledge of
or receiving notice of:
(i) the occurrence of any Default or Event of Default;
(ii) the institution by any Person of, or the threat of,
any action, suit or proceeding or any governmental investigation or any
arbitration, before any court or arbitrator or any governmental or
administrative body, agency, or official, against the Borrower or any
Subsidiary which if adversely determined could have a Materially
Adverse Effect or in any manner draws into question the validity or
enforceability of the Credit Documents;
(iii) any actual or alleged violation, or notice of any
action, claim or request for information, either judicial or
administrative, from any governmental authority relating to any actual
or alleged claim, notice of potential responsibility under or violation
of any Environmental Law, or any actual or alleged spill, leak,
disposal or other release of any waste, petroleum product, or hazardous
waste or Hazardous Substance by any Consolidated Company which could
result in penalties, fines, claims or other liabilities to any
Consolidated Company in amounts in excess of $1,000,000;
(iv) with respect to any Plan, (A) a "reportable event"
described in Section 4043 of ERISA and the regulations issued from time
to time thereunder (other than a "reportable event" not subject to the
provisions for 30-day notice to the PBGC under such regulations), or
(B) any other event which could subject the Borrower or any ERISA
Affiliate to any material tax, penalty or liability under Title I or
Title IV of ERISA or Chapter 43 of the Code;
(v) at the same time and in the same manner as such
notice must be provided to the PBGC, or to a Plan participant,
beneficiary or alternative payee, any notice required under Section
101(d), 302(f)(4), 303, 307, 4041(b)(1)(A) or 4041(c)(I)(A) of ERISA or
under Section 401(a)(29) or 412 of the Code with respect to any Plan;
and
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(vi) a default under any agreement or instrument
evidencing Debt for which the Borrower or any Subsidiary is liable, which
individually or in the aggregate with all other agreements or instruments in
default for which the Borrower or any Subsidiary is liable, exceed $2,000,000;
the Borrower will deliver an Officer's Certificate of the Borrower setting forth
the details thereof and the action which the Borrower is taking or proposes to
take with respect thereto;
(h) Within 30 days after the formation or acquisition of any
Material Subsidiary, or any other event resulting in the creation of a new
Material Subsidiary, notice of the formation or acquisition of such Material
Subsidiary or such occurrence, including a description of the assets of such
entity, the activities in which it will be engaged, and such other information
as the Agent may request;
(i) Promptly upon the existence or occurrence thereof, notice of
the existence or occurrence of failure of any Consolidated Company to hold in
full force and effect those trademarks, service marks, patents, trade names,
copyrights, licenses and similar rights necessary in the normal conduct of its
business, the loss or absence of which could have a Materially Adverse Effect;
and
(j) With reasonable promptness, any other information about the
Consolidated Companies as the Agent or any Lender, through the Agent, may
reasonably request from time to time.
SECTION 6.10. COVENANT TO SECURE NOTES EQUALLY. If the Borrower or any
Subsidiary shall create or assume any Lien upon any of its property or assets,
whether now owned or hereafter acquired, other than permitted by Section 7.02(a)
hereof, make or cause to be made effective provision whereby the Notes will be
secured by such Lien equally and ratably with all other Debt thereby secured so
long as any such other Debt shall be so secured.
SECTION 6.11. ADDITIONAL CREDIT PARTIES. Promptly after (i) the
formation or acquisition (provided that nothing in this Section shall be deemed
to authorize the acquisition or formation of any entity) of any Material
Subsidiary, (ii) the transfer of assets to any Consolidated Company if as a
result thereof the recipient of such assets becomes a Material Subsidiary, or
(iii) the occurrence of any other event creating a new Material Subsidiary,
Borrower shall execute and deliver, and cause to be executed and delivered a
Guaranty Agreement from each such Material Subsidiary, together with related
documents evidencing the due authorization, execution and delivery of such
Guaranty, and the enforceability thereof, all in form and substance satisfactory
to the Agent and the Lenders.
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ARTICLE VII.
NEGATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any Note shall
remain unpaid or any Letter of Credit Obligation shall remain outstanding,
Borrower will not and will not permit any Subsidiary to (unless waived in
writing by the Required Lenders):
SECTION 7.01. CERTAIN FINANCIAL LIMITS. At any time permit, as of the
last day of any fiscal quarter:
(a) Consolidated Current Assets to be less than 200% of
Consolidated Current Liabilities;
(b) Consolidated Adjusted Debt to exceed 60% of Consolidated
Adjusted Capitalization;
(c) Consolidated Priority Debt to exceed 25% of Consolidated
Capitalization;
(d) Operating Lease Rentals to exceed 20% of Consolidated Tangible
Net Worth; or
(e) the Financed Receivables Amount to exceed 60% of the sum of
the Retained Receivables Amount and the Financed Receivables Amount.
SECTION 7.02. LIENS, DEBT AND OTHER RESTRICTIONS.
(a) Liens. Create, assume or suffer to exist any Lien upon any of
its property or assets, whether now owned or hereafter acquired, except:
(i) Liens existing on the Closing Date and disclosed on
Schedule 7.02(a) and Liens in favor of the Agent and/or the Lenders to secure
the obligations;
(ii) Liens for taxes (including ad valorem and property
taxes) and assessments or governmental charges or levies not yet due or which
are being actively contested in good faith by appropriate proceedings;
(iii) other Liens incidental to the conduct of its business
or the maintenance, operation, construction or ownership of its property and
assets (including pledges or deposits in connection with workers' compensation
and social security taxes, assessments and charges, and landlords, mechanics and
materialmen Liens and survey exceptions or encumbrances,
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easements or reservations, rights-of-way, or zoning restrictions) provided that
(A) such Liens were not incurred in connection with the borrowing of money, or
the obtaining of advances or credit or the payment of the deferred purchase
price of property and (B) the existence of such Lien does not materially detract
from the value of such property or assets to the Borrower or any Subsidiary or
unreasonably interfere with the ordinary conduct of business;
(iv) Liens on property or assets of a Subsidiary to secure
obligations of such Subsidiary to the Borrower or another Subsidiary;
(v) Liens incurred in connection with a Receivables
Financing;
(vi) other Liens securing Consolidated Priority Debt which
do not cause the Borrower to violate Section 7.01 hereof at any time and which
Debt may be incurred pursuant to Section 7.02(b) hereof; and
(vii) any right of set off or banker's lien (whether by
common law, statute, contract or otherwise) in favor of any bank; provided that
no such right or lien shall be allowed to any bank where the Borrower or any
Subsidiary both (x) owes any Debt to, and (y) has an account or other assets on
deposit with, such bank.
(b) Debt. Create, incur, assume or suffer to exist any Debt,
except:
(i) Debt of any Subsidiary to the Borrower or another
Subsidiary;
(ii) other Debt of the Borrower (other than owed to a
Subsidiary) or of a Subsidiary, which does not cause the Borrower to violate
Section 7.01 hereof at any time;
(iii) Debt under this Agreement, the Term Loan Agreement,
the Prudential Agreement and other Debt outstanding on the Closing Date and
disclosed on Schedule 7.02(b); and
(iv) Guaranties permitted pursuant to Section 7.02(i).
(c) Merger or Consolidation. Merge, consolidate or exchange shares
with any other Person, except that:
(i) any Subsidiary may merge or consolidate with the
Borrower or another Subsidiary;
(ii) the Borrower may merge or consolidate with any other
corporation (including a Subsidiary) if the continuing or surviving corporation
is organized under the laws of, and with a majority of its assets located in,
the United States or a state thereof or the District of Columbia and the
continuing or surviving corporation (if not the Borrower) assumes the
obligations of the Borrower hereunder under an agreement reasonably acceptable
to the Required Lenders, and
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immediately after such merger or consolidation, no Default or Event of Default
shall have occurred or exist;
(iii) any Subsidiary may merge with another Person in
connection with an acquisition of such Person permitted under this Agreement;
provided that, following such merger, the Borrower owns the same percentage of
outstanding voting stock of the surviving entity as Borrower owned of such
Subsidiary prior to such merger and further provided that no Default or Event of
Default exists hereunder or would result therefrom.
(d) Sale and Lease-Back. Enter into or permit to remain in effect
any Sale and Leaseback Transaction with any Person unless the Attributable Debt
does not cause the Borrower to violate Section 7.01 hereof at any time and is
also permitted under Section 7.02(b) hereof.
(e) Sale or Discount of Receivables. Sell with recourse, or
discount or otherwise sell for less than the face value thereof, any of its
notes or accounts receivable except (i) in a Receivables Financing that could
not, or over time would not, violate Section 7.01(e) hereof, provided that, on
the date of any proposed Receivables Financing and immediately after giving
effect thereto, the Financed Receivables Amount does not exceed the Retained
Receivables Amount, or (ii) to any Subsidiary or to the Borrower.
(f) Change in Business. Enter into any business which is
substantially different from that presently conducted by the Borrower and its
Subsidiaries if, as a result thereof, 10% or more of Consolidated Revenues or
Consolidated Operating Income during the preceding twelve month period ending on
the date of the proposed acquisition of or entry into such new business,
calculated on a pro forma basis as if such new business had been acquired or
entered into on the first day of such period, would be derived from all such
different businesses.
(g) Transactions with Related Party. Effect any transaction with
any Affiliate or Subsidiary (other than transactions between Credit Parties and
transfers of assets from a Guarantor to the Borrower or another Guarantor), by
which any asset or services of the Borrower or a Subsidiary is transferred to
such Affiliate or Subsidiary, or from such Affiliate or Subsidiary, on terms
more favorable than would be reasonably expected in a similar transaction with
an unrelated entity except for sales of accounts and notes receivable by the
Borrower to any Subsidiary or by any Subsidiary to the Borrower or to any
Subsidiary as permitted under Section 7.02(e).
(h) Loans, Advances and Investments. Make or permit to remain
outstanding any loan or advance to, or own, purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any Person, except that the Borrower or any Subsidiary may:
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(i) permit to remain outstanding investments in the stock
of any existing Subsidiary;
(ii) own, purchase or acquire stock, obligations,
securities or assets of a Subsidiary or of a corporation which immediately after
such purchase or acquisition will be a wholly-owned Subsidiary of Borrower;
(iii) acquire and own stock, obligations or securities
received in settlement of debts (created in the ordinary course of business)
owing to the Borrower or any Subsidiary;
(iv) own, purchase or acquire prime commercial paper,
bankers' acceptances or certificates of deposit in United States commercial
banks (having capital resources in excess of $50,000,000), in each case due
within one year from the date of purchase and payable in the United States in
United States dollars, obligations of the United States Government or any agency
thereof and obligations guaranteed by the United States Government;
(v) make or permit to remain outstanding travel and other
like advances to officers and employees in the ordinary course of business;
(vi) make or permit to remain outstanding loans or
advances to any Person in the ordinary course of business provided that the
aggregate principal amount of such loans and advances shall not exceed
$1,000,000 in the aggregate during any 12 consecutive month period for the
Borrower and all Subsidiaries; and
(vii) make or permit to remain outstanding intercompany
loans among the Borrower and its Subsidiaries; provided that, the aggregate
amount of intercompany loans outstanding from the Credit Parties to Subsidiaries
which are non-credit parties shall not exceed $5,000,000 at any one time
outstanding and provided further that (i) in the case of intercompany loans made
to a Credit Party, such intercompany loans shall be subordinated in right of
payment to the Obligations on terms and conditions satisfactory to the Required
Lenders, and (ii) in the case of intercompany loans made by a Credit Party, such
intercompany loans shall be payable on demand.
(i) Guarantees. Execute any Guaranty in favor of any Person
except:
(i) endorsements of instruments for deposit or collection
in the ordinary course of business;
(ii) guarantees by Borrower or any Subsidiary on behalf of
Borrower or any Subsidiary; and
(iii) guarantees which do not cause Borrower to violate
Section 7.01(b) hereof.
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SECTION 7.03. SALE OF PROPERTY. Dispose of any property or assets,
except:
(a) any Subsidiary may Dispose of its assets to the Borrower or
any other wholly-owned Subsidiary of Borrower;
(b) the Borrower or any Subsidiary may effect any (i) sale of
receivables permitted by Section 7.02(e) hereof or (ii) any Sale and Leaseback
Transaction permitted by Section 7.02(d) hereof;
(c) the Borrower or any Subsidiary may Dispose of inventory in the
ordinary course of business; and
(d) the Borrower or any Subsidiary may Dispose of any other of its
assets so long as, immediately after giving effect to such proposed Disposition:
(i) the consideration for such assets represents the Fair
Market Value of such assets (as determined in good faith by a Responsible
Officer in the case of assets having a Fair Market Value of less than $1,000,000
or otherwise, the Borrower's Board) at the time of such Disposition; and
(ii) the cumulative net book value of all assets so
Disposed of by the Borrower and its Subsidiaries;
(1) during the prior 12 months does not exceed
15% of Consolidated Tangible Assets; and
(2) after the date of this Agreement, does not
exceed 25% of Consolidated Tangible Assets as at the end of the most recently
completed fiscal quarter; and
(iii) the amount of Consolidated Operating Income produced
by all assets so Disposed of by the Borrower and its Subsidiaries during the
prior 12 months does not exceed 10% of Consolidated Operating Income at the end
of the most recently completed 12 months; and
(iv) no Default or Event of Default shall exist.
For purposes of this Section 7.03:
(i) "Disposition" means the sale, Lease, transfer or
other disposition of property, and "Disposed of" has a corresponding meaning to
Disposition. "Lease" means the lease of any property for more than 2 years; and
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(ii) Calculation of net book value/Consolidated Operating
Income. The net book value of any assets shall be determined as of the
respective date of Disposition of those assets and the Consolidated Operating
Income produced by any assets shall be determined using Consolidated Operating
Income for the 12 month period before the respective date of Disposition of
those assets.
SECTION 7.04. SUBSIDIARY STOCK AND DEBT.
(a) directly or indirectly sell, assign, pledge or otherwise
Dispose of any Debt of or any shares of stock of (or warrants, rights or options
to acquire stock of) any Subsidiary except to another Subsidiary or as permitted
under Section 7.02(c) hereof;
(b) permit any Subsidiary directly or indirectly to sell, assign,
pledge or otherwise dispose of any Debt of the Borrower or any other Subsidiary,
or any shares of stock of (or warrants, rights or options to acquire stock of)
any other Subsidiary, except to the Borrower or another Subsidiary or as
permitted under Section 7.02(c) hereof;
(c) permit any Subsidiary to have outstanding any shares of
Preferred Stock other than Preferred Stock (1) existing at the time the
Subsidiary becomes a Subsidiary or (2) owned by the Borrower or another
Subsidiary;
(d) permit any Subsidiary, directly or indirectly, to issue or
sell any shares of its stock (or warrants, rights or options to acquire its
stock) except to the Borrower or another Subsidiary or except as permitted under
Sections 7.02(c) and Section 7.03 hereof; or
(e) permit any Subsidiary to enter into or otherwise be bound by
or subject to any contract or agreement (including, without limitation, any
provision of its certificate or articles of incorporation or bylaws) that
restricts its ability to pay dividends or other distributions on account of its
stock; or
(f) permit any Subsidiary to create, incur, assume or maintain any
Debt that is not permitted by Sections 7.01 and 7.02(b) hereof.
SECTION 7.05. ERISA.
(a) terminate or withdraw from any Plan resulting in the
incurrence of any material liability to the PBGC;
(b) engage in or permit any Person to engage in any prohibited
transaction (as defined in Section 4975 of the Code) involving any Plan (other
than a Multiemployer Plan) which would subject the Borrower or any Subsidiary to
any material tax, penalty or other liability;
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(c) incur or suffer to exist any material accumulated funding
deficiency (as defined in Section 302 of ERISA and Section 412 of the Code),
whether or not waived, involving any Plan (other than a Multiemployer Plan); or
(d) allow or suffer to exist any risk or condition which presents
a risk of incurring a material liability to the PBGC.
SECTION 7.06. ENVIRONMENTAL MATTERS. Use, produce, manufacture,
process, generate, store, dispose of, manage at, or ship or transport to or from
the Properties any Hazardous Substances or permit any Third Party to do any of
the foregoing, except for Hazardous Substances used, produced, released or
managed in the ordinary course of business in compliance with all applicable
Environmental Laws except where the failure to do so would not have a Materially
Adverse Effect.
SECTION 7.07. AMENDMENT OF ARTICLES OR BYLAWS. With respect to the
Borrower, amend its charter, by-laws or other governing documents to create any
new class of stock or to alter the relative voting rights of Borrower's Class A
Stock or in any other manner which would materially dilute the voting power of
the Class A Stock with respect to the ability to vote for the Board of Directors
of the Borrower.
ARTICLE VIII.
EVENTS OF DEFAULT
Upon the occurrence and during the continuance of any of the following
specified events (each an "Event of Default"):
SECTION 8.01. PAYMENTS. Borrower shall fail to make promptly when due
(including, without limitation, by mandatory prepayment) any principal payment
with respect to the Loans, or Borrower shall fail to make within five (5) days
after the due date thereof any payment of interest, fee or other amount payable
hereunder or any of the Obligations;
SECTION 8.02. COVENANTS WITHOUT NOTICE. Borrower shall fail to observe
or perform any covenant or agreement contained in Sections 6.09(g)(i), and 7.01
through 7.04 or 7.07;
SECTION 8.03. OTHER COVENANTS. Borrower shall fail to observe or
perform any covenant or agreement contained in this Agreement, other than those
referred to in Sections 8.01 and 8.02, and, if capable of being remedied, such
failure shall remain unremedied for thirty (30) days (or in the case of failure
to observe or perform the covenants contained in any other subsection of Section
6.09, ten (10) days) after the earlier of (i) Borrower's obtaining knowledge
thereof, or (ii) written notice thereof shall have been given to Borrower by
Agent or any Lender;
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SECTION 8.04. REPRESENTATIONS. Any representation, warranty or
statement made or deemed to be made by Borrower or any other Credit Party or by
any of its officers under this Agreement or any other Credit Document (including
the Schedules attached thereto), or any certificate or other document submitted
to the Agent or the Lenders by any such Person pursuant to the terms of this
Agreement or any other Credit Document, shall be incorrect in any material
respect when made or deemed to be made or submitted;
SECTION 8.05. NON-PAYMENTS OF OTHER DEBT. Any Consolidated Company
shall fail to make when due (whether at stated maturity, by acceleration, on
demand or otherwise, and after giving effect to any applicable grace period) any
payment of principal of or interest on any Debt (other than the Obligations)
exceeding $5,000,000 in the aggregate, including without limitation, the
Subsidiary Credit Agreement;
SECTION 8.06. DEFAULTS UNDER OTHER AGREEMENTS. Any Consolidated Company
shall fail to observe or perform within any applicable grace period any
covenants or agreements contained in any agreements or instruments relating to
any of its Debt exceeding $5,000,000 in the aggregate, or any other event shall
occur if the effect of such failure or other event is to accelerate, or to
permit the holder of such Debt or any other Person to accelerate, the maturity
of such Debt; or any such Debt shall be required to be prepaid (other than by a
regularly scheduled required prepayment) in whole or in part prior to its stated
maturity;
SECTION 8.07. BANKRUPTCY. Borrower or any other Consolidated Company
shall commence a voluntary case concerning itself under the Bankruptcy Code or
applicable foreign bankruptcy laws; or an involuntary case for bankruptcy is
commenced against any Consolidated Company and the petition is not controverted
within 10 days, or is not dismissed within 60 days, after commencement of the
case; or a custodian (as defined in the Bankruptcy Code) or similar official
under applicable foreign bankruptcy laws is appointed for, or takes charge of,
all or any substantial part of the property of any Consolidated Company; or any
Consolidated Company commences proceedings of its own bankruptcy or to be
granted a suspension of payments or any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction, whether now or
hereafter in effect, relating to any Consolidated Company or there is commenced
against any Consolidated Company any such proceeding which remains undismissed
for a period of 60 days; or any Consolidated Company is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or any Consolidated Company suffers any appointment of
any custodian or the like for it or any substantial part of its property to
continue undischarged or unstayed for a period of 60 days; or any Consolidated
Company makes a general assignment for the benefit of creditors; or any
Consolidated Company shall fail to pay, or shall state that it is unable to pay,
or shall be unable to pay, its debts generally as they become due; or any
Consolidated Company shall call a meeting of its creditors with a view to
arranging a composition or adjustment of its debts; or any Consolidated Company
shall by any act or failure to act indicate its consent to, approval of
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or acquiescence in any of the foregoing; or any corporate action is taken by any
Consolidated Company for the purpose of effecting any of the foregoing;
SECTION 8.08. ERISA. A Plan of a Consolidated Company or a Plan subject
to Title IV of ERISA of any of its ERISA Affiliates:
(i) shall fail to be funded in accordance with the
minimum funding standard required by applicable law, the terms of such Plan,
Section 412 of the Tax Code or Section 302 of ERISA for any plan year or a
waiver of such standard is sought or granted with respect to such Plan under
applicable law, the terms of such Plan or Section 412 of the Tax Code or Section
303 of ERISA; or
(ii) is being, or has been, terminated or the subject of
termination proceedings under applicable law or the terms of such Plan; or
(iii) shall require a Consolidated Company to provide
security under applicable law, the terms of such Plan, Section 401 or 412 of the
Tax Code or Section 306 or 307 of ERISA; or
(iv) results for any reason, in a liability (including
without limitation, withdrawal liability) to a Consolidated Company under
applicable law, the terms of such Plan, or Title IV of ERISA;
and there shall result from any such failure, waiver, termination or other event
a liability to the PBGC, a Plan or any other Person that would have a Materially
Adverse Effect;
SECTION 8.09. MONEY JUDGMENT. A judgment or order for the payment of
money in excess of $5,000,000 or otherwise having a Materially Adverse Effect
shall be rendered against Borrower or any other Consolidated Company and such
judgment or order shall continue unsatisfied (in the case of a money judgment)
and in effect for a period of 30 days during which execution shall not be
effectively stayed or deferred (whether by action of a court, by agreement or
otherwise);
SECTION 8.10. OWNERSHIP OF GUARANTORS. If Borrower shall at any time
fail to own and control, directly or indirectly through wholly-owned
Subsidiaries, one hundred percent (100%) of the voting stock of each Guarantor,
except as permitted pursuant to Sections 7.02(c) and 7.03 hereof;
SECTION 8.11. CHANGE IN CONTROL OF BORROWER. Borrower shall merge,
consolidate or exchange shares with any other Person where such merger,
consolidation or exchange results in (i) any Person other than a Class A
Shareholder as of the Closing Date or two or more Persons (unless all such
Persons are Class A Shareholders as of the Closing Date) acting in concert
acquiring
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beneficial ownership (within the meaning of Rule 13d-3 of the Securities and
Exchange Commission under the Securities Exchange Act of 1934) of fifty percent
(50%) or more of the outstanding shares of the Class A common stock of Borrower,
excluding any sales, transfers or gifts to spouses or direct descendants of
Class A Shareholders as of the date of this Agreement; (ii) a majority of the
Board of Directors of Borrower consisting of individuals who were not either (A)
directors of Borrower as of the corresponding date of the previous year, (B)
selected or nominated to become directors by the Board of Directors of Borrower
of which a majority consisted of individuals described in clause (A) above, or
(C) selected or nominated to become directors by the Board of Directors of
Borrower of which a majority consisted of individuals described in clause (A)
above and individuals described in clause (B) above; or (iii) the dissolution of
Borrower;
SECTION 8.12. DEFAULT UNDER OTHER CREDIT DOCUMENTS. There shall exist
or occur any "Event of Default" as provided under the terms of any other Credit
Document, or any Credit Document ceases to be in full force and effect or the
validity or enforceability thereof is disaffirmed by or on behalf of Borrower or
any other Credit Party, or at any time it is or becomes unlawful for Borrower or
any other Credit Party to perform or comply with its obligations under any
Credit Document, or the obligations of Borrower or any other Credit Party under
any Credit Document are not or cease to be legal, valid and binding on Borrower;
or
SECTION 8.13. ATTACHMENTS. An attachment or similar action shall be
made on or taken against any of the assets of any Consolidated Company with a
book value exceeding $5,000,000 in aggregate and is not removed, suspended or
enjoined within 30 days of the same being made or any suspension or injunction
being lifted;
then, and in any such event, and at any time thereafter if any Event of Default
shall then be continuing, the Agent may, with the consent of the Required
Lenders, and upon the written (including telecopied) or telex request of the
Required Lenders, shall, by written notice to Borrower, take any or all of the
following actions, without prejudice to the rights of the Agent, any Lender or
the holder of any Note to enforce its claims against Borrower or any other
Credit Party: (i) declare all Commitments terminated, whereupon the pro rata
Commitments of each Lender shall terminate immediately and any commitment fee
shall forthwith become due and payable without any other notice of any kind; and
(ii) declare the principal of and any accrued interest on the Loans, and all
other Obligations owing hereunder, including without limitation, an amount equal
to the maximum amount which would be available at any time to be drawn under all
Letters of Credit then outstanding (whether or not any beneficiary under any
Letter of Credit shall have presented, or shall be entitled at such time to
present, the drafts or other documents required to draw under such Letter of
Credit), to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by Borrower; provided, that, if an Event of Default specified
in Section 8.07 shall occur, the result which would occur upon the giving of
written notice by the Agent to any Credit Party, as specified in clauses (i) and
(ii) above, shall occur automatically without the giving of any such notice; and
(iii) exercise any rights or remedies under the Security Documents. As long as
any Letter of Credit shall remain outstanding, any amounts described in clause
(ii) above with respect to Letters of Credit, when received by the
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Agent, shall be deposited in a cash collateral account as cash collateral for
the obligations of Borrower under Article II of this Agreement in the event of
any drawing under a Letter of Credit, and upon drawing under any outstanding
Letter of Credit in respect of which the Agent has deposited in the cash
collateral account any amounts described in clause (ii) above, the Agent shall
pay such amounts to itself to reimburse itself for the amount of such drawing.
ARTICLE IX.
THE AGENT AND CO-AGENTS
SECTION 9.01. APPOINTMENT OF AGENT. Each Lender hereby designates
SunTrust as Agent to administer all matters concerning the Loans and Letters of
Credit and to act as herein specified. Each Lender hereby irrevocably
authorizes, and each holder of any Note by the ac ceptance of a Note shall be
deemed irrevocably to authorize, the Agent to take such actions on its behalf
under the provisions of this Agreement, the other Credit Documents, and all
other instruments and agreements referred to herein or therein, and to exercise
such powers and to perform such duties hereunder and thereunder as are
specifically delegated to or required of the Agent by the terms hereof and
thereof and such other powers as are reasonably incidental thereto. The Agent
may perform any of its duties hereunder by or through their agents or employees.
SECTION 9.02. AUTHORIZATION OF AGENT WITH RESPECT TO THE SECURITY
DOCUMENTS.
(a) Each Lender hereby authorizes the Agent to enter into each of
the Security Documents substantially in the form attached hereto, and to take
all action contemplated thereby. All rights and remedies under the Security
Documents may be exercised by the Agent for the benefit of the Agent and the
Lenders and the other beneficiaries thereof upon the terms thereof. The Lenders
further agree that the Agent may assign its rights and obligations under any of
the Security Documents to any affiliate of the Agent or to any trustee, if
necessary or appropriate under applicable law, which assignee in each such case
shall (subject to compliance with any requirements of applicable law governing
the assignment of such Security Documents) be entitled to all the rights of the
Agent under and with respect to the applicable Security Document.
(b) In each circumstance where, under any provision of any
Security Document, the Agent shall have the right to grant or withhold any
consent, exercise any remedy, make any determination or direct any action by the
Agent under such Security Document, the Agent shall act in respect of such
consent, exercise of remedies, determination or action, as the case may be, with
the consent of and at the direction of the Required Lenders; provided, however,
that no such consent of the Required Lenders shall be required with respect to
any consent, determination or other matter that is, in the Agent's judgment,
ministerial or administrative in nature. In each circumstance where any consent
of or direction from the Required Lenders is required, the Agent shall send to
the Lenders a notice setting forth a description in reasonable detail of the
matter as to which consent or
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direction is requested and the Agent's proposed course of action with respect
thereto. The Lenders shall endeavor to respond promptly to such request but in
the event the Agent shall not have received a response from any Lender within
five (5) Business Days after such Lender's receipt of such notice, such Lender
shall be deemed not to have agreed to the course of action proposed by the
Agent.
SECTION 9.03. NATURE OF DUTIES OF AGENT. The Agent shall have no duties
or responsibilities except those expressly set forth in this Agreement and the
other Credit Documents. None of the Agent nor any of its respective officers,
directors, employees or agents shall be liable for any action taken or omitted
by it as such hereunder or in connection herewith, unless caused by its or their
gross negligence or willful misconduct. The duties of the Agent shall be
ministerial and administrative in nature; the Agent shall not have by reason of
this Agreement a fiduciary relationship in respect of any Lender; and nothing in
this Agreement, express or implied, is intended to or shall be so construed as
to impose upon the Agent any obligations in respect of this Agreement or the
other Credit Documents except as expressly set forth herein.
SECTION 9.04. LACK OF RELIANCE ON THE AGENT.
(a) Independently and without reliance upon the Agent, each
Lender, to the extent it deems appropriate, has made and shall continue to make
(i) its own independent investigation of the financial condition and affairs of
the Credit Parties in connection with the taking or not taking of any action in
connection herewith, and (ii) its own appraisal of the creditworthiness of the
Credit Parties, and, except as expressly provided in this Agreement, the Agent
shall have no duty or responsibility, either initially or on a continuing basis,
to provide any Lender with any credit or other information with respect thereto,
whether coming into its possession before the making of the Loans or at any time
or times thereafter.
(b) The Agent shall not be responsible to any Lender for any
recitals, statements, information, representations or warranties herein or in
any document, certificate or other writing delivered in connection herewith or
for the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Agreement, the Notes, the
Guaranty Agreement, or any other documents contemplated hereby or thereby, or
the financial condition of the Credit Parties, or be required to make any
inquiry concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement, the Notes, the Guaranty Agreement,
or the other documents contemplated hereby or thereby, or the financial
condition of the Credit Parties, or the existence or possible existence of any
Default or Event of Default; provided, however, to the extent that the Agent has
been advised that a Lender has not received any information formally delivered
to the Agent pursuant to Section 6.09, the Agent shall deliver or cause to be
delivered such information to such Lender.
SECTION 9.05. CERTAIN RIGHTS OF THE AGENT. If the Agent shall request
instructions from the Required Lenders with respect to any action or actions
(including the failure to act) in connection with this Agreement, the Agent
shall be entitled to refrain from such act or taking such act, unless and until
the Agent shall have received instructions from the Required Lenders; and the
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Agent shall not incur liability in any Person by reason of so refraining.
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against the Agent as a result of the Agent acting or refraining from
acting hereunder in accordance with the instructions of the Required Lenders.
SECTION 9.06. RELIANCE BY AGENT. The Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message, cable
gram, radiogram, order or other documentary, teletransmission or telephone
message believed by it to be genuine and correct and to have been signed, sent
or made by the proper Person. The Agent may consult with legal counsel
(including counsel for any Credit Party), independent public accountants and
other experts selected by it and shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the advice of such
counsel, accountants or experts.
SECTION 9.07. INDEMNIFICATION OF AGENT. To the extent the Agent is not
reimbursed and indemnified by the Credit Parties, each Lender will reimburse and
indemnify the Agent, ratably according to the respective amounts of the Loans
outstanding under all Facilities (or if no amounts are outstanding, ratably in
accordance with the aggregate Commitments), in either case, for and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses (including counsel fees and disbursements) or
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by or asserted against the Agent in performing its duties hereunder, in any way
relating to or arising out of this Agreement or the other Credit Documents;
provided that no Lender shall be liable to the Agent for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Agent's gross negligence or
willful misconduct.
SECTION 9.08. THE AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
obligation to lend under this Agreement, the Loans made by it and the Notes
issued to it, the Agent shall have the same rights and powers hereunder as any
other Lender or holder of a Note and may exercise the same as though it were not
performing the duties specified herein; and the terms "Lenders", "Required
Lenders", "holders of Notes", or any similar terms shall, unless the context
clearly otherwise indicates, include the Agent in its individual capacity. The
Agent may accept deposits from, lend money to, and generally engage in any kind
of banking, trust, financial advisory or other business with the Consolidated
Companies or any affiliate of the Consolidated Companies as if it were not
performing the duties specified herein, and may accept fees and other
consideration from the Consolidated Companies for services in connection with
this Agreement and otherwise without having to account for the same to the
Lenders.
SECTION 9.09. HOLDERS OF NOTES. The Agent may deem and treat the payee
of any Note as the owner thereof for all purposes hereof unless and until a
written notice of the assignment or transfer thereof shall have been filed with
the Agent. Any request, authority or consent of any
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Person who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee or assignee of such Note or of any Note or Notes
issued in exchange therefor.
SECTION 9.10. SUCCESSOR AGENT.
(a) The Agent may resign at any time by giving written notice
thereof to the Lenders and Borrower and may be removed at any time with or
without cause by the Required Lenders; provided, however, the Agent may not
resign or be removed until a successor Agent has been appointed and shall have
accepted such appointment. Upon any such resignation or removal, the Required
Lenders shall have the right to appoint a successor Agent subject to Borrower's
prior written approval. 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 Lenders, appoint a successor Agent subject to Borrower's prior written
approval, which shall be a bank which maintains an office in the United States,
or a commercial bank organized under the laws of the United States of America or
any State thereof, or any Affiliate of such bank, having a combined capital and
surplus of at least $100,000,000.
(b) Upon the acceptance of any appointment as the Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement. After any retiring Agent's resignation or removal hereunder as
Agent, the provisions of this Article IX shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was an Agent under this
Agreement.
SECTION 9.11. CO-AGENTS. Each Lender hereby designates First Union
National Bank and NationsBank, N.A. as the Co-Agents. The Co-Agents, in such
capacity, shall have no duties or obligations whatsoever under this Agreement or
any other Credit Document but shall be entitled to the protections of this
Article IX.
ARTICLE X.
MISCELLANEOUS
SECTION 10.01. NOTICES. All notices, requests and other communications
to any party hereunder shall be in writing (including bank wire, telex, telecopy
or similar teletransmission or writing) and shall be given to such party at its
address or applicable teletransmission number set forth on the signature pages
hereof, or such other address or applicable teletransmission number as such
party may hereafter specify by notice to the Agent and Borrower. Each such
notice, request or other communication shall be effective (i) if given by telex,
when such telex is transmitted to the telex number specified in this Section and
the appropriate answerback is received, (ii) if given by mail, 72 hours after
such communication is deposited in the mails with first class postage prepaid,
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addressed as aforesaid, (iii) if given by telecopy, when such telecopy is
transmitted to the telecopy number specified in this Section and the appropriate
confirmation is received, or (iv) if given by any other means (including,
without limitation, by air courier), when delivered or received at the address
specified in this Section; provided that notices to the Agent shall not be
effective until received.
SECTION 10.02. AMENDMENTS, ETC. No amendment or waiver of any provision
of this Agreement or the other Credit Documents, nor consent to any departure by
any Credit Party therefrom, shall in any event be effective unless the same
shall be in writing and signed by Borrower and 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 that no amendment, waiver or
consent shall, unless in writing and signed by Borrower and all the Lenders do
any of the following: (i) waive any of the conditions specified in Section 4.01
or 4.02, (ii) increase the Commitments or other contractual obligations to
Borrower under this Agreement, (iii) reduce the principal of, or interest on,
the Notes or any fees hereunder, (iv) postpone any date fixed for the payment in
respect of principal of, or interest on, the Notes or any fees hereunder, (v)
change the percentage of the Commitments or of the aggregate unpaid principal
amount of the Notes, or the number or identity of Lenders which shall be
required for the Lenders or any of them to take any action hereunder, (vi) agree
to release any Guarantor from its obligations under any Guaranty Agreement,
(vii) modify the definition of "Required Lenders," or (viii) modify this Section
10.02. Notwithstanding the foregoing, no amendment, waiver or consent shall,
unless in writing and signed by Borrower and the Agent in addition to the
Lenders required hereinabove to take such action, affect the rights or duties of
the Agent under this Agreement or under any other Credit Document.
SECTION 10.03. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on
the part of the Agent, the Co-Agents, any Lender or any holder of a Note in
exercising any right or remedy hereunder or under any other Credit Document, and
no course of dealing between any Credit Party and the Agent, the Co-Agents, any
Lender or the holder of any Note shall operate as a waiver thereof, nor shall
any single or partial exercise of any right or remedy hereunder or under any
other Credit Document preclude any other or further exercise thereof or the
exercise of any other right or remedy hereunder or thereunder. The rights and
remedies herein expressly provided are cumulative and not exclusive of any
rights or remedies which the Agent, the Co-Agents, any Lender or the holder of
any Note would otherwise have. No notice to or demand on any Credit Party not
required hereunder or under any other Credit Document in any case shall entitle
any Credit Party to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Agent, the Co-Agents,
the Lenders or the holder of any Note to any other or further action in any
circumstances without notice or demand.
SECTION 10.04. PAYMENT OF EXPENSES, ETC. Borrower shall:
(i) whether or not the transactions hereby contemplated
are consummated, pay all reasonable, out-of-pocket costs and expenses of the
Agent in the administration (both before
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and after the execution hereof and including reasonable expenses actually
incurred relating to advice of counsel as to the rights and duties of the Agent
and the Lenders with respect thereto) of, and in connection with the
preparation, execution and delivery of, preservation of rights under,
enforcement of, and, after a Default or Event of Default, refinancing,
renegotiation or restructuring of, this Agreement and the other Credit Documents
and the documents and instruments referred to therein, and any amendment, waiver
or consent relating thereto (including, without limitation, the reasonable fees
actually incurred and reasonable disbursements of counsel for the Agent), and in
the case of enforcement of this Agreement or any Credit Document after an Event
of Default, all such reasonable, out-of-pocket costs and expenses (including,
without limitation, the reasonable fees actually incurred and disbursements of
counsel, including the allocated costs of internal counsel), for any of the
Co-Agents and the Lenders;
(ii) subject, in the case of certain Taxes, to the
applicable provisions of Section 3.07(b), pay and hold each of the Agent, the
Co-Agents and the Lenders harmless from and against any and all present and
future stamp, documentary, and other similar Taxes with respect to this
Agreement, the Notes and any other Credit Documents, any collateral described
therein, or any payments due thereunder, and save each of the Lenders harmless
from and against any and all liabilities with respect to or resulting from any
delay or omission to pay such Taxes; and
(iii) indemnify the Agent, the Co-Agents and each Lender,
and their respective Affiliates, officers, directors, employees, representatives
and agents from, and hold each of them harmless against, any and all costs,
losses, liabilities, claims, damages or expenses incurred by any of them
(whether or not any of them is designated a party thereto) (an "Indemnitee")
arising out of or by reason of any investigation, litigation or other proceeding
related to any actual or proposed use of the proceeds of any of the Loans or any
Credit Party's entering into and performing of the Agreement, the Notes, or the
other Credit Documents, including, without limitation, the reasonable fees
actually incurred and disbursements of counsel incurred in connection with any
such investigation, litigation or other proceeding; provided, however, Borrower
shall not be obligated to indemnify any Indemnitee for any of the foregoing
arising out of such Indemnitee's gross negligence or willful misconduct;
(iv) In addition to amounts payable elsewhere provided in
this Agreement, without duplication, indemnify, pay and save the Agent harmless
from and against any and all claims, demands, liabilities, damages, losses,
costs, charges and reasonable expenses (including reasonable attorney's fees and
disbursements) which the Agent may incur or be subject to as a consequence,
direct or indirect, of (i) the issuance of any Letter of Credit for the account
of Borrower, other than as a result of the gross negligence or willful
misconduct of the Agent; (ii) the failure of the Agent to honor a drawing under
any Letter of Credit due to any act or omission (whether rightful or wrongful)
of any present or future de jure or de facto government or governmental
authority; or (iii) any confirmation of any Letter of Credit obtained by the
Agent with the consent of Borrower;
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(v) without limiting the indemnities set forth above,
indemnify each Indemnitee for any and all expenses and costs (including without
limitation, remedial, removal, response, abatement, cleanup, investigative,
closure and monitoring costs), losses, claims (including claims for contribution
or indemnity and including the cost of investigating or defending any claim and
whether or not such claim is ultimately defeated, and whether such claim arose
before, during or after any Credit Party's ownership, operation, possession or
control of its business, property or facilities or before, on or after the date
hereof, and including also any amounts paid incidental to any compromise or
settlement by the Indemnitee or Indemnitees to the holders of any such claim),
lawsuits, liabilities, obligations, actions, judgments, suits, disbursements,
encumbrances, liens, damages (including without limitation damages for
contamination or destruction of natural resources), penalties and fines of any
kind or nature whatsoever (including without limitation in all cases the
reasonable fees actually incurred, other reasonable charges and disbursements of
counsel in connection therewith) incurred, suffered or sustained by that
Indemnitee based upon, arising under or relating to Environmental Laws based on,
arising out of or relating to in whole or in part, the existence or exercise of
any rights or remedies by any Indemnitee under this Agreement, any other Credit
Document or any related documents (but excluding those incurred, suffered or
sustained by any Indemnitee as a result of any action taken by or on behalf of
the Lenders with respect to any Subsidiary of Borrower (or the assets thereof)
owned or controlled by the Lenders, the Agent, the Co-Agents, or their nominees
or designees.
If and to the extent that the obligations of Borrower under this Section 10.04
are unenforceable for any reason, Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.
SECTION 10.05. WAIVER OF RIGHT OF SETOFF. The Agent and each Lender
hereby waives, with respect to the Obligations, any contractual or common law
right of setoff against any deposits of any Credit Party now or hereafter held
by and other indebtedness or property then or thereafter owing by such Lender or
other holder to any Credit Party.
SECTION 10.06. BENEFIT OF AGREEMENT.
(a) This Agreement shall be binding upon and inure to the benefit
of and be enforceable by the respective successors and assigns of the parties
hereto, provided that Borrower may not assign or transfer any of its interest
hereunder without the prior written consent of the Lenders.
(b) Any Lender may make, carry or transfer Loans at, to or for the
account of, any of its branch offices or the office of an Affiliate of such
Lender.
(c) Each Lender may assign all or a portion of its interests,
rights and obligations under this Agreement (including all or a portion of any
of its Commitments, Letter of Credit
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Obligations and the Loans at the time owing to it and the Notes held by it) to
any Eligible Assignee; provided, however, that (i) the Agent and Borrower must
give their prior written consent to such assignment (which consent shall not be
unreasonably withheld) unless such assignment is to an Affiliate of the
assigning Lender or, in the case of Borrower, unless an Event of Default has
occurred and is continuing, (ii) the amount of the Commitments or Loans or
Letter of Credit Obligations, of the assigning Lender subject to each assignment
(determined as of the date the assignment and acceptance with respect to such
assignment is delivered to the Agent) shall not be less than $10,000,000 (or the
total amount of such Lender's Commitment), (iii) the parties to each such
assignment shall execute and deliver to the Agent an Assignment and Acceptance,
together with a Note or Notes subject to such assignment and, unless such
assignment is to an Affiliate of such Lender, a processing and recordation fee
of $3,000, and (iv) any assignment of the Commitments or Loans hereunder shall
be made simultaneously with a pro rata assignment of commitments and loans of
such Lender pursuant to the Subsidiary Credit Agreement unless the Borrower and
the Agent otherwise agree. Borrower shall not be responsible for such processing
and recordation fee or any costs or expenses incurred by any Lender or the Agent
in connection with such assignment. From and after the effective date specified
in each Assignment and Acceptance, which effective date shall be at least five
(5) Business Days after the execution thereof, the assignee thereunder shall be
a party hereto and to the extent of the interest assigned by such Assignment and
Acceptance, have the rights and obligations of a Lender under this Agreement.
Notwithstanding the foregoing, the assigning Lender must retain after the
consummation of such Assignment and Acceptance, a minimum aggregate amount of
Commitments, the Loans and the Letter of Credit Obligations, as the case may be,
of $10,000,000 (unless the Lender is assigning its entire Commitment); provided,
however, no such minimum amount shall be required with respect to any such
assignment made at any time there exists an Event of Default hereunder. Within
five (5) Business Days after receipt of the notice and the Assignment and
Acceptance, Borrower, at its own expense, shall execute and deliver to the
Agent, in exchange for the surrendered Note or Notes, a new Note or Notes to the
order of such assignee in a principal amount equal to the applicable Commitments
assumed by it pursuant to such Assignment and Acceptance and new Note or Notes
to the assigning Lender in the amount of its retained Commitment or Commitments.
Such new Note or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes, shall be dated the
date of the surrendered Note or Notes which they replace, and shall otherwise be
in substantially the form attached hereto.
(d) Each Lender may, without the consent of Borrower or the Agent,
sell participations to one or more banks or other entities in all or a portion
of its rights and/or obligations under this Agreement (including all or a
portion of its Commitments, the Letter of Credit Obligations and the Loans owing
to it and the Notes held by it), provided, however, that (i) no Lender may sell
a participation in its aggregate Commitments (after giving effect to any
permitted assignment hereof) in an amount in excess of fifty percent (50%) of
such aggregate Commitments, provided, however, sales of participations to an
Affiliate of such Lender shall not be included in such calculation; provided,
however, no such maximum amount shall be applicable to any such participation
sold at any time there exists an Event of Default hereunder, (ii) such Lender's
obligations under this Agreement shall remain unchanged, (iii) such Lender shall
remain solely responsible to the other
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parties hereto for the performance of such obligations, and (iv) the
participating bank or other entity shall not be entitled to the benefit (except
through its selling Lender) of the cost protection provisions contained in
Article III of this Agreement, and (v) Borrower and the Agent and other Lenders
shall continue to deal solely and directly with each Lender in connection with
such Lender's rights and obligations under this Agreement and the other Credit
Documents, and such Lender shall retain the sole right to enforce the
obligations of Borrower relating to the Loans and to approve any amendment,
modification or waiver of any provisions of this Agreement. Any Lender selling a
participation hereunder shall provide prompt written notice to Borrower of the
name of such participant.
(e) Any Lender or participant may, in connection with the
assignment or participation or proposed assignment or participation, pursuant to
this Section, disclose to the assignee or participant or proposed assignee or
participant any information relating to Borrower or the other Consolidated
Companies furnished to such Lender by or on behalf of Borrower or any other
Consolidated Company. With respect to any disclosure of confidential,
non-public, proprietary information, such proposed assignee or participant shall
agree to use the information only for the purpose of making any necessary credit
judgments with respect to this credit facility and not to use the information in
any manner prohibited by any law, including without limitation, the securities
laws of the United States. The proposed participant or assignee shall agree not
to disclose any of such information except (i) to directors, employees, auditors
or counsel to whom it is necessary to show such information, each of whom shall
be informed of the confidential nature of the information, (ii) in any statement
or testimony pursuant to a subpoena or order by any court, governmental body or
other agency asserting jurisdiction over such entity, or as otherwise required
by law (provided prior notice is given to Borrower and the Agent unless
otherwise prohibited by the subpoena, order or law), and (iii) upon the request
or demand of any regulatory agency or authority with proper jurisdiction. The
proposed participant or assignee shall further agree to return all documents or
other written material and copies thereof received from any Lender, the Agent or
Borrower relating to such confidential information unless otherwise properly
disposed of by such entity.
(f) Any Lender may at any time assign all or any portion of its
rights in this Agreement and the Notes issued to it to a Federal Reserve Bank;
provided that no such assignment shall release the Lender from any of its
obligations hereunder.
(g) If (i) any Taxes referred to in Section 3.07(b) have been
levied or imposed so as to require withholdings or deductions by Borrower and
payment by Borrower of additional amounts to any Lender as a result thereof,
(ii) any Lender shall make demand for payment of increased costs or reduced rate
of return pursuant to Section 3.10 or any Lender determines that LIBOR is
unascertainable or illegal pursuant to Section 3.08 or Section 3.09, or any
Lender makes a claim for increased costs or determines that its participation in
any Letter of Credit is illegal pursuant to Section 3.09, or (iii) any Lender
shall decline to consent to a modification or waiver of
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the terms of this Agreement or the other Credit Documents requested by Borrower,
then and in such event, upon request from Borrower delivered to such Lender and
the Agent, such Lender shall assign, in accordance with the provisions of
Section 10.06(c), all of its rights and obligations under this Agreement and the
other Credit Documents to another Lender or an Eligible Assignee selected by
Borrower, in consideration for the payment by such assignee to the Lender of the
principal of, and interest on, the outstanding Loans accrued to the date of such
assignment, and the assumption of such Lender's Commitment hereunder, together
with any and all other amounts owing to such Lender under any provisions of this
Agreement or the other Credit Documents accrued to the date of such assignment;
provided, however, Lenders subject to this Section 10.06 shall be treated in a
substantially identical manner.
SECTION 10.07. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER OF
JURY TRIAL.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER AND UNDER THE NOTES SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE
GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF GEORGIA.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT,
THE NOTES OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE SUPERIOR COURT OF
XXXXXX COUNTY, GEORGIA, OR ANY OTHER COURT OF THE STATE OF GEORGIA OR OF THE
UNITED STATES OF AMERICA FOR THE NORTHERN DISTRICT OF GEORGIA, AND, BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, BORROWER HEREBY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE TRIAL BY JURY, AND
BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION,
ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY SUCH
ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.
(c) Nothing herein shall affect the right of the Agent, any
Co-Agent, any Lender, any holder of a Note or any Credit Party to commence legal
proceedings or otherwise proceed against Borrower in any other jurisdiction.
SECTION 10.08. INDEPENDENT NATURE OF LENDERS' RIGHTS. The amounts
payable at any time hereunder to each Lender shall be a separate and independent
debt, and each Lender shall be entitled to protect and enforce its rights
pursuant to this Agreement and its Notes, and it shall not
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be necessary for any other Lender to be joined as an additional party in any
proceeding for such purpose.
SECTION 10.09. COUNTERPARTS. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
SECTION 10.10. EFFECTIVENESS; SURVIVAL.
(a) This Agreement shall become effective on the date (the
"Effective Date") on which all of the parties hereto shall have signed a copy
hereof (whether the same or different copies) and shall have delivered the same
to the Agent pursuant to Section 10.01 or, in the case of the Lenders, shall
have given to the Agent written or telex notice (actually received) that the
same has been signed and mailed to them.
(b) The obligations of Borrower under Sections 3.07(b), 3.12,
3.10, 3.15 and 10.04 hereof shall survive the payment in full of the Notes and
all other Obligations after the Maturity Date. All representations and
warranties made herein, in the certificates, reports, notices, and other
documents delivered pursuant to this Agreement shall survive the execution and
delivery of this Agreement, the other Credit Documents, and such other
agreements and documents, the making of the Loans hereunder, and the execution
and delivery of the Notes.
SECTION 10.11. SEVERABILITY. In case any provision in or obligation
under this Agreement or the other Credit Documents shall be invalid, illegal or
unenforceable, in whole or in part, in any jurisdiction, the validity, legality
and enforceability of the remaining provisions or obligations, or of such
provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby.
SECTION 10.12. INDEPENDENCE OF COVENANTS. All covenants hereunder shall
be given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or be otherwise within the limitation of, another covenant, shall
not avoid the occurrence of a Default or an Event of Default if such action is
taken or condition exists.
SECTION 10.13. CHANGE IN ACCOUNTING PRINCIPLES, FISCAL YEAR OR TAX
LAWS. If (i) any preparation of the financial statements referred to in Section
6.09 hereafter occasioned by the promulgation of rules, regulations,
pronouncements and opinions by or required by the Financial Accounting Standards
Board or the American Institute of Certified Public Accounts (or successors
thereto or agencies with similar functions) (other than changes mandated by FASB
106) result in a material change in the method of calculation of financial
covenants, standards or terms found in this
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Agreement, (ii) there is any change in Borrower's fiscal quarter or fiscal year,
or (iii) there is a material change in federal tax laws which materially affects
any of the Consolidated Companies' ability to comply with the financial
covenants, standards or terms found in this Agreement, Borrower and the Required
Lenders agree to enter into negotiations in order to amend such provisions so as
to equitably reflect such changes with the desired result that the criteria for
evaluating any of the Consolidated Companies' financial condition shall be the
same after such changes as if such changes had not been made. Unless and until
such provisions have been so amended, the provisions of this Agreement shall
govern.
SECTION 10.14. HEADINGS DESCRIPTIVE; ENTIRE AGREEMENT. The headings of
the several sections and subsections of this Agreement are inserted for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Agreement. This Agreement, the other Credit Documents, and
the agreements and documents required to be delivered pursuant to the terms of
this Agreement constitute the entire agreement among the parties hereto and
thereto regarding the subject matters hereof and thereof and supersede all prior
agreements, representations and understandings related to such subject matters.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and to be delivered in Atlanta, Georgia, by their duly authorized
officers as of the day and year first above written.
Address for Notices: XXXXXXX FURNITURE COMPANIES, INC.
000 Xxxx Xxxxxxxxx Xx., X.X. By: /s/ Xxxxxx X. Xxxx
Xxxxxxx, Xxxxxxx 00000-0000 -----------------------------
Xxxxxx X. Xxxx
Executive Vice President
Attn: Xxxxxx X. Xxxx
Attest: /s/ Xxxxx Xxxx Xxxxxx
-------------------------
Telephone: (000) 000-0000 Xxxxx Xxxx Xxxxxx
Telecopy: (000) 000-0000 Secretary
[CORPORATE SEAL]
[SIGNATURE PAGE TO CREDIT AGREEMENT]
84
Address for Notices: SUNTRUST BANK, ATLANTA,
AS AGENT
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxx X. Xxxxx
Attention: Xxxxx X. Xxxxx -----------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxx X. Xxxxx
------------------------
Title: A.V.P.
-----------------------
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------
Title: VICE PRESIDENT
-----------------------
Payment Office:
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[SIGNATURE PAGE TO CREDIT AGREEMENT]
85
Address for Notices: SUNTRUST BANK, ATLANTA
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxx X. Xxxxx
Attention: Xxxxx X. Xxxxx -----------------------------
Telecopy No.: 404) 588-8833 Name: Xxxxx X. Xxxxx
------------------------
Title: A.V.P.
-----------------------
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxx
------------------------
Title: VICE PRESIDENT
-----------------------
Lending Office:
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $15,000,000.00
PRO RATA SHARE OF
COMMITMENTS: 28.57%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
86
Address for Notices: FIRST UNION NATIONAL BANK,
INDIVIDUALLY AND AS CO-AGENT
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: First Union National Bank
Attention: Xxxxxxxx X. Xxxx -----------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxxxxx Xxxxxx
------------------------
Title: Asst. Secretary
-----------------------
Corporate Banking Officer
Lending Office:
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $12,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 23.81%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
87
Address for Notices: NATIONSBANK, N.A.,
INDIVIDUALLY AND AS CO-AGENT
NationsBank
NC1-007-08-04
000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx By: /s/ E. Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000 --------------------------------
Attention: Xxxx Xxxxxxx Xxxxx Name: Xxxx Xxxxx
-------------------- ---------------------------
Telecopy No.: Title: V.P.
------------------ --------------------------
Lending Office:
NationsBank
NC1-007-08-04
000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
COMMITMENT: $12,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 23.81%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
88
Address for Notices: WACHOVIA BANK, N.A.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxxxx X. Xxxxx
Attention: Xxxxxxx Xxxx -----------------------------
Telecopy No.: 000-000-0000 Name: Xxxxxxx X. Xxxxx
------------------------
Title: Vice President
-----------------------
Lending Office:
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $7,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 14.29%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
89
Address for Notices: THE BANK OF TOKYO-MITSUBISHI,
LTD., ATLANTA AGENCY
000 Xxxxxxxxx Xxxxxx X.X. #0000
Xxxxxxx, Xxxxxxx 00000-0000 By: /s/ Xxxxxxx X. Xxxxxxxx
Attention: Xxxx Xxxxx -------------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxxxx X. Xxxxxxxx
--------------------------
Title: Assistant Vice President
-------------------------
Lending Office:
000 Xxxxxxxxx Xxxxxx X.X. #0000
Xxxxxxx, Xxxxxxx 00000-0000
COMMITMENT: $5,000,000.00
PRO RATA SHARE OF
COMMITMENTS: 9.52%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
90
SCHEDULE 5.01(a) - LACK OF QUALIFICATION
None
91
SCHEDULE 5.01(b) - ORGANIZATION AND OWNERSHIP OF SUBSIDIARIES
State of
Company Incorporation Ownership
------- ------------- ---------
Havertys Credit Services, Inc. Tennessee 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
100% of Preferred Stock held by
Havertys Enterprises, Inc.
Havertys Capital, Inc. Nevada 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
Havertys Enterprises, Inc. Nevada 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
92
SCHEDULE 5.05 - CERTAIN PENDING AND THREATENED LITIGATION
None
93
SCHEDULE 5.08 - ENVIRONMENTAL MATTERS
None
94
SCHEDULE 5.11 - TAX FILINGS AND PAYMENTS
None
95
SCHEDULE 5.14 - EMPLOYEE BENEFIT MATTERS
(1) Identification of Plans.
Xxxxxxx Furniture Companies, Inc. Retirement Plan
(as Amended and Restated Effective January 1, 1989)
(2) Compliance.
None
(3) Liabilities.
None
(4) Funding.
None
96
SCHEDULE 5.15 - PATENT, TRADEMARK, LICENSE, AND OTHER INTELLECTUAL PROPERTY
MATTERS
None
97
SCHEDULE 5.16-OWNERSHIP OF PROPERTIES
None
98
SCHEDULE 5.19-DIVIDEND RESTRICTIONS
The Corporation shall not declare any dividend on the Class A Common Stock,
except dividends payable solely in shares of common stock or other equity
securities of the Corporation, unless concurrently with such declaration and
payment there is paid on the Common Stock, on a share for share basis, a
dividend of at least 105% of the amount of the dividend declared and paid on the
Class A Common Stock.
99
SCHEDULE 7.02(a)-LIENS
Liens for leasehold improvements, fixtures and equipment on properties under
Master Leases (treated as Operating Leases) with the following Lessors:
1. Sumitomo Bank of New York Trust Company dated August 28, 1995, covering
retail and warehouse properties in charlotte, NC (Carolina Place Store),
Atlanta, GA (Town Center Store), Tampa, FL (Xxxxxxx Store) and Dallas, TX
(Warehouse and Coppel Store)
2. Sumitomo Bank Leasing and Finance, Inc. dated November 15, 1996, ("Phase
II") covering retail properties in Nashville, TN (Cool Springs Store),
Memphis, TN (Wolf Creek Store) and Dallas/Ft. Worth, TX (Xxxxx Bend Store)
100
Page 1
SCHEDULE 7.02(b)
DEBT OUTSTANDING AS OF 3/31/98 CLOSING DATE
Original Current Short Long
Loan Balance Term Term
------------ ------------ ------------ ------------
Consolidated Bank Lines of Credit (detail page 2) N/A $ 67,300,000 $ 67,300,000 $ 0
Unsecured Term Notes:
Prudential Insurance Company (08/12/88) $ 45,000,000 $ 12,500,000 $ 5,000,000 $ 7,500,000
Prudential Insurance Company (12/29/93) 30,000,000 30,000,000 0 30,000,000
Prudential Insurance Company (10/13/95) 15,000,000 15,000,000 0 15,000,000
Prudential Insurance Company (09/30/96) 15,000,000 15,000,000 0 15,000,000
Suntrust Bank (03/31/95) 15,000,000 14,875,000 500,000 14,375,000
Suntrust Bank (05/31/95) 15,000,000 14,875,000 500,000 14,375,000
------------ ------------ ------------ ------------
Total Unsecured Term Notes $135,000,000 $102,250,000 $ 6,000,000 $ 96,250,000
------------ ------------ ------------
Mortgages (detail page 2) $ 29,714,544 12,628,848 1,917,805 10,711,043
Industrial Development Bonds (detail page 3) $ 6,600,000 1,617,345 417,770 1,199,575
Capitalized Leases (detail page 3) N/A 2,892,377 619,441 2,272,936
------------ ------------ ------------
Total Consolidated Debt $186,688,570 $ 76,255,016 $110,433,554
============ ============ ============
101
Schedule 7.02(b) (Continued)
Page 2
(1)
[---Bank Lines in Place---] [------------Amounts Outstanding------------]
Committed Uncommitted Total Committed Uncommitted
----------- ------------- ------------ ------------ -----------
Consolidated Bank Lines of Credit
Xxxxxxx Furniture Companies, Inc.:
Sun Trust Bank $15,000,000 $ 0 $ 0 $ 0 $ 0
NationsBank 15,000,000 5,000,000 0 0 0
Xxxxxxx Bank 0 25,000,000 23,600,000 0 23,600,000***
Wachovia 8,000,000 15,000,000 22,900,000 8,000,000 14,900,000
Bank of Tokyo, Ltd. 18,000,000 0 0 0 0
Sanwa Bank 0 5,000,000 0 0 0
Havertys Credit Services, Inc.:
First Union 40,000,000 0 20,800,000 20,800,000 0
----------- ------------ ----------- ----------- -----------
Total Consoildated Bank Lines of Credit $96,000,000 $ 50,000,000 $67,300,000 $28,800,000 $35,500,000
=========== ============ =========== =========== ===========
(1) Before Actual Execution of this Revolving Credit Facility and the
Concurrent Cancellation or Reduction of the Committed Lines
Current
Original Loan Balance Short Term Long Term
------------- ---------- ------------ -----------
Mortgaages:
City of Farmers Branch (Tax Assessment) $ 43,544 $ 38,781 $ 1,405 $ 37,376
First Federal Savings & Loan (Vero Beach) 925,000 925,000 0 925,000
Trust Co.(Austin) 1,840,000 1,196,000 122,666 1,073,334
Trust Co.(G.O./West Peachtree & Spring) 1,948,000 1,266,200 129,867 1,136,333
Trust Co.(Raleigh/Kitty Hawk) 612,000 397,800 40,800 357,000
-------------- --------- ----------- -----------
Subtotal - Trust Company (dated 12/30/92) 4,400,000 2,860,000 293,333 2,566,667
Wachovia (Sarasota/Tamiami Trail) 1,200,000 180,000 80,000 100,000
Wachovia (Cocoa/Hwy 1) 875,000 131,250 58,333 72,917
Wachovia (Melbourne/X.Xxx Haven) 1,525,000 228,750 101,667 127,083
Wachovaia (Memphis/Raleigh Springs Whse) 600,000 100,000 40,000 60,000
Wachovia (Tampa/Northgate) 1,250,000 208,333 83,333 125,000
Wachovia (Montgomery/Atlanta Hwy) * 860,000 286,667 57,333 229,334
Wachovia (Little Rock/Warehouse) * 960,000 320,000 64,000 256,000
Wachovia (Eastern Regional Whse) * 900,000 300,000 60,000 240,000
Wachovia (Tuscalossa/XxXxxxxxx) * 1,300,000 433,333 86,667 346,666
Wachovia (Greenville/Xxxxxxx Xx) * 1,600,000 533,334 106,667 426,667
Wachovia (Atlanta/Xxxx Parkway) * 600,000 200,000 40,000 160,000
Wachovia (Columbia/Dutch Square) * 870,000 290,000 58,000 232,000
Wachovia (Charleston/N Charleston) * 970,000 323,333 64,667 258,666
Wachovia (Columbia/Two Notch) * 880,000 293,333 58,666 234,667
Wachovia (Athens/Atlanta Hwy) * 1,120,000 373,334 74,667 298,667
Wachovia (Nashville/Xxxx Quaker Whse) * 1,760,000 586,667 117,333 469,334
Wachovia (Atlanta/Gwennett Place) * 1,840,000 613,333 122,667 490,666
Wachovia (Ft. Xxxxxx/Port St. Lucie) ** 840,000 546,000 56,000 490,000
Wachovia (Ft. Xxxxxx/Treasure Coast) ** 1,400,000 910,000 93,333 816,667
Wachovia (Atlanta/Southlake) ** 1,246,000 809,900 83,067 726,833
Wachovia (Savannah/Abercorn) ** 1,750,000 1,137,500 116,667 1,020,833
-------------- ----------- ----------- -----------
Subtotal - Wachovia/FNB of Atlanta 24,346,000 8,805,067 1,623,067 7,182,000
-------------- ----------- ----------- -----------
Total Mortgages $ 29,714,544 $12,628,848 $ 1,917,805 $10,711,043
============== =========== =========== ===========
* Wachovia (dated 03/01/88) (Multi-Property) Subtotal $13,660,000 $ 4,553,334 $ 910,667 $ 3,642,667
** Wachovia (dated 12/29/92) (Multi-Property) Subtotal $ 5,236,000 $ 3,403,400 $ 349,067 $ 3,054,333
*** Repaid in full on closing date.
102
Schedule 7.02(b) (continued)
Page 3
Current
Industrial Development Bonds: Original Loan Balance Short Term Long Term
------------- ------------ ---------- -----------
Hall Try./Wachovia (Gainesville) $ 700,000 $ 93,333 $ 46,667 $ 46,666
Dekalb Bond/Wachovia (Atl. Whse Add't'n) 1,350,000 225,000 90,000 135,000
Jax Bond/First Union (Jax Whse Add't'n) 1,350,000 463,695 70,435 393,260
Snellville Bond Wach. (Snellville) 1,000,000 183,317 66,668 116,649
Nashville Bond Wach. (Hickory Hollow) 2,200,000 652,000 144,000 508,000
------------- ------------ ---------- -----------
Total IDBs $ 6,600,000 $ 1,617,345 $ 417,770 $ 1,199,575
============= ============ ========== ===========
Current
Capitalized Lease Obligations: Original Debt Balance Short Term Long Term
------------- ----------- ---------- -----------
Tampa (052) $ 78,017 $ 71,773 $ 6,244
Richmond (050) 99,915 91,923 7,992
Augusta (051) 103,006 94,765 8,241
Lakeland (043) 39,009 30,883 8,126
Fox Xxxxxxx (047) 145,274 26,556 118,718
Southlake (048) 169,438 30,437 139,001
Xxxxxxx Bridge (054) 183,667 45,709 137,958
Xxxxxxxxxxx (053) 208,300 84,298 124,002
Orange Park (057) 171,140 60,783 110,357
MSRW (122) $ 2,100,000 1,694,611 82,314 1,612,297
------------- ----------- ---------- -----------
Total Capitalized Leases $ 2,892,377 $ 619,441 $ 2,272,936
=========== ========== ===========
103
EXHIBIT A
FORM OF
REVOLVING CREDIT NOTE
U.S. $________________ March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned XXXXXXX FURNITURE COMPANIES, INC.,
a Maryland corporation (herein called "Borrower"), hereby promises to pay to the
order of _______________________________, a _____________________ (herein,
together with any subsequent holder hereof, called the "Lender"), for the
account of its applicable Lending Office, on the Maturity Date the lesser of (i)
the principal sum of _____________________________________ AND NO/100 UNITED
STATES DOLLARS ($_______________) and (ii) the outstanding principal amount of
the Advances made by Lender to Borrower as Syndicated Loans pursuant to the
terms of the Credit Agreement referred to below. Borrower likewise promises to
pay interest on the outstanding principal amount of each such Advance, at such
interest rates, payable at such times, and computed in such manner, as are
specified for such Advance in the Credit Agreement in strict accordance with the
terms thereof.
The Lender shall record all Advances made as Syndicated Loans pursuant
to its Commitment under the Credit Agreement and all payments of principal of
such Advances and, prior to any transfer hereof, shall endorse such Advances and
payments on the schedule annexed hereto and made a part hereof, or on any
continuation thereof which shall be attached hereto and made a part hereof or on
the books and records of the Lender, which endorsement shall constitute prima
facie evidence of the accuracy of the information so endorsed; provided,
however, that delay or failure of the Lender to make any such endorsement or
recordation shall not affect the obligations of Borrower hereunder or under the
Credit Agreement with respect to the Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Revolving Credit Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement.
104
This Revolving Credit Note is issued pursuant to, and is one of the
Revolving Credit Notes referred to in, the Credit Agreement dated as of March
31, 1998 among Borrower, SunTrust Bank, Atlanta as Agent, First Union National
Bank and NationsBank, N.A., as Co-Agents, and the other lenders set forth on
the signature pages thereof (as the same may be further amended, modified or
supplemented from time to time, the "Credit Agreement") and each assignee
thereof becoming a "Lender" as provided therein, and the Lender is and shall be
entitled to all benefits thereof and all Security Documents executed and
delivered to the Lenders or the Agent in connection therewith. Terms defined in
the Credit Agreement are used herein with the same meanings. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and for mandatory
prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Advances in strict accordance with the terms thereof.
This Revolving Credit Note may be prepaid in whole or in part in
accordance with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Revolving Credit Note may
automatically become, or be declared, due and payable in the manner and with the
effect provided in the Credit Agreement. Borrower agrees to pay, and save the
Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Lender of any of its
rights under this Revolving Credit Note or the Credit Agreement.
This Revolving Credit Note has been executed and delivered in Georgia
and the rights and obligations of the Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Revolving Credit Note, now or hereafter required by
applicable law. TIME IS OF THE ESSENCE OF THIS REVOLVING CREDIT NOTE.
105
IN WITNESS WHEREOF, Borrower has caused this Revolving Credit Note to
be executed and delivered under seal by its duly authorized officers as of the
date first above written.
XXXXXXX FURNITURE COMPANIES, INC.
By:
--------------------------------------
Name:
Title:
Attest:
---------------------------------
Name:
Title:
[CORPORATE SEAL]
106
Revolving Credit Note (cont'd)
ADVANCES AND PAYMENTS OF PRINCIPAL
Last Day of
Amount of Applicable Notation
Amount of Interest Principal Interest Made
Date Advance Rate Prepaid Period By
-----------------------------------------------------------------------------------------------------------------------
107
EXHIBIT B
FORM OF BID FACILITY NOTE
U.S. $_____________________ March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned XXXXXXX FURNITURE COMPANIES, INC.,
a Maryland corporation (herein called "Borrower"), hereby promises to pay to the
order of _______________________________, a _____________________ (herein,
together with any subsequent holder hereof, called the "Lender"), for the
account of its applicable Lending Office, on the Maturity Date the lesser of (i)
the principal sum of _____________________________ ($__________) and (ii) the
outstanding principal amount of the Bid Rate Advances made by Lender to Borrower
as Bid Rate Loans pursuant to the terms of the Credit Agreement referred to
below. Borrower likewise promises to pay interest on the outstanding principal
amount of each such Bid Rate Advance, at such interest rates, payable at such
times, and computed in such manner, as are specified for such Bid Rate Advance
in strict accordance with the terms of the Credit Agreement.
The Lender shall record all Bid Rate Advances made pursuant to the
Credit Agreement and all payments of principal of such Advances and, prior to
any transfer hereof, shall endorse such Advances and payments on the schedule
annexed hereto and made a part hereof, or on any continuation thereof which
shall be attached hereto and made a part hereof or on the books and records of
the Lender, which endorsement shall constitute prima facie evidence of the
accuracy of the information so endorsed; provided, however, that delay or
failure of the Lender to make any such endorsement or recordation shall not
affect the obligations of Borrower hereunder or under the Credit Agreement with
respect to the Bid Rate Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Bid Facility Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement.
This Bid Facility Note is issued pursuant to, and is one of the Bid
Facility Notes referred to in, the Credit Agreement dated as of March 31, 1998
among Borrower, SunTrust Bank, Atlanta as Agent, First Union National Bank and
NationsBank, N.A, as Co-Agents, and the other lenders set forth on the signature
pages thereof (as the same may be further amended, modified or
108
supplemented from time to time, the "Credit Agreement") and each assignee
thereof becoming a "Lender" as provided therein, and the Lender is and shall be
entitled to all benefits thereof and all Security Documents executed and
delivered to the Lenders or the Agent in connection therewith. Terms defined in
the Credit Agreement are used herein with the same meanings. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and for mandatory
prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Bid Rate Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Bid Rate Advances in strict accordance with the terms
thereof.
This Bid Facility Note may be prepaid in whole or in part in accordance
with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Bid Facility Note may
automatically become, or be declared, due and payable in the manner and with the
effect provided in the Credit Agreement. Borrower agrees to pay, and save the
Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Lender of any of its
rights under this Bid Facility Note or the Credit Agreement.
This Bid Facility Note has been executed and delivered in Georgia and
the rights and obligations of the Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Bid Facility Note, now or hereafter required by applicable
law. TIME IS OF THE ESSENCE OF THIS BID FACILITY NOTE.
-2-
109
IN WITNESS WHEREOF, Borrower has caused this Bid Facility Note to be
executed and delivered under seal by its duly authorized officers as of the date
first above written.
XXXXXXX FURNITURE COMPANIES, INC.
By:
----------------------------------------
Name:
Title:
Attest:
------------------------------------
Name:
Title:
[CORPORATE SEAL]
-3-
110
Bid Facility Note (cont'd)
ADVANCES AND PAYMENTS OF PRINCIPAL
Last Day of
Amount of Applicable Notation
Amount of Interest Principal Interest Made
Date Advance Rate Prepaid Period By
--------------------------------------------------------------------------------------------------------------------------
-4-
111
EXHIBIT C
FORM OF
SWING LINE NOTE
U.S. $5,000,000.00 March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned XXXXXXX FURNITURE COMPANIES, INC.,
a Maryland corporation (the "Borrower") hereby promises to pay to the order of
SUNTRUST BANK, ATLANTA, a Georgia banking corporation (herein, together with any
subsequent holder hereof, the "Swing Line Lender") on the Maturity Date, an
amount equal to the lesser of (x) FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00) or (y) so much thereof as may have been advanced by the Swing
Line Lender to the Borrower under the Swing Line Subcommitment established
pursuant to the terms of that certain Credit Agreement referred to below.
Borrower likewise promises to pay interest on the outstanding principal amount
of each such Swing Line Advance, at such interest rates, payable at such times,
and computed in such manner, as are specified for such Advance in the Credit
Agreement in strict accordance with the terms thereof.
The Swing Line Lender shall record all Swing Line Advances made
pursuant to its Swing Line Subcommitment under the Credit Agreement and all
payments of principal of such Advances and, prior to any transfer hereof, shall
endorse such Advances and payments on the schedule annexed hereto and made a
part hereof, or on any continuation thereof which shall be attached hereto and
made a part hereof or on the books and records of the Swing Line Lender, which
endorsement shall constitute prima facie evidence of the accuracy of the
information so endorsed; provided, however, that delay or failure of the Swing
Line Lender to make any such endorsement or recordation shall not affect the
obligations of Borrower hereunder or under the Credit Agreement with respect to
the Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Swing Line Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement unless otherwise directed
by the Agent or the Swing Line Lender.
This Swing Line Note is issued pursuant to, and is the Swing Line Note
referred to in, the Credit Agreement dated as of March 31, 1998 among Borrower,
SunTrust Bank, Atlanta as Agent, First Union National Bank and NationsBank,
N.A., as Co-Agents, and the other lenders set forth on the signature pages
thereof (as the same may be further amended, modified or supplemented from time
to time, the "Credit Agreement") and each assignee thereof becoming a "Lender"
as provided therein, and the Swing Line Lender is and shall be entitled to all
benefits thereof and all Security Documents executed and delivered to the
Lenders or the Agent in connection therewith. Terms
112
defined in the Credit Agreement are used herein with the same meanings. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events and for
mandatory prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Advances in strict accordance with the terms thereof.
This Swing Line Note may be prepaid in whole or in part in accordance
with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Swing Line Note may automatically
become, or be declared, due and payable in the manner and with the effect
provided in the Credit Agreement. Borrower agrees to pay, and save the Swing
Line Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Swing Line Lender of
any of its rights under this Swing Line Note or the Credit Agreement.
This Swing Line Note has been executed and delivered in Georgia and the
rights and obligations of the Swing Line Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Swing Line Note, now or hereafter required by applicable
law. TIME IS OF THE ESSENCE OF THIS SWING LINE NOTE.
IN WITNESS WHEREOF, the Borrower has caused this Swing Line Note to be
executed under seal and delivered by its duly authorized officer as of the date
first above written.
XXXXXXX FURNITURE COMPANIES, INC.
By:
----------------------------------------
Xxxxxx X. Xxxx
Executive Vice President
Attest:
-------------------------------------
Xxxxx Xxxx Xxxxxx
Secretary
[CORPORATE SEAL]
2
113
SCHEDULE TO SWING LINE NOTE
Advances made under the Swing Line Subcommitment referred to in the
foregoing Swing Line Note.
Principal Maturity Interest Payments
Amount of Date of Rate of Made on Notation
Date Loan Loan Loan Loan Made By
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
3
114
EXHIBIT D
FORM OF BID REQUEST LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below,
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, XXXXXXX FURNITURE COMPANIES, INC. (the "Borrower"),
refers to the Credit Agreement dated as of March 31, 1998 (as amended, modified,
extended or restated from time to time, the "Credit Agreement"), among the
Borrower, the financial institutions party thereto as Lenders, SunTrust Bank,
Atlanta, as Agent, and First Union National Bank and NationsBank, N.A., as
Co-Agents. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement. The Borrower
hereby gives you notice pursuant to Section 2.09(a) of the Credit Agreement that
it requests a Bid Rate Loan or Bid Rate Loans under the Credit Agreement, and in
that connection sets forth below the terms on which such Bid Rate Loan or Bid
Rate Loans is or are requested to be made:
(A) Date of Bid Rate Loan
(which is a Business Day) ______ ______
(B) Interest Period and the last
day thereof (1) ______ ______
(C) Principal Amount of
Bid Rate Loan (2) ______ ______
Upon acceptance of any or all of the Bid Rate Advances offered by the
Lenders in response to this request, the Borrower shall be deemed to have
represented and warranted that the conditions to lending specified in Section
4.02 of the Credit Agreement have been satisfied.
-------------
(1) Which shall be subject to the definition of "Interest Period" and end
not later than the Maturity Date.
(2) Not less than $2,000,000 (and in integral multiples of $100,000) nor
greater than the lesser of (1) the amount by which $50,000,000 exceeds the
aggregate outstanding amount of Bid Rate Loans and (2) the amount by which the
sum of the Commitments exceeds the sum of the outstanding principal amount of
the Loans.
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Very truly yours,
XXXXXXX FURNITURE COMPANIES, INC.
By:
---------------------------------------
Title: [Responsible Officer]
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EXHIBIT E
FORM OF BID REQUEST INVITE LETTER
[Name of Lender]
[Address]
[Date]
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of March 31, 1998
(as it may be amended, modified, extended or restated from time to time, the
"Credit Agreement"), among XXXXXXX FURNITURE COMPANIES, INC. (the "Borrower"),
the financial institutions party thereto as Lenders, SUNTRUST BANK, ATLANTA, as
Agent, and FIRST UNION NATIONAL BANK and NATIONSBANK, N.A., as Co-Agents.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The Borrower made a Bid
Rate Bid Request on __________ ___, 19__, pursuant to Section 2.09(a) of the
Credit Agreement, and in that connection you are invited to submit a Bid Rate
Bid or Bid Rate Bids by [Date]/[Time].(1) Each of your Bid Rate Bids must comply
with Section 2.09(b) of the Credit Agreement and the terms set forth below on
which the Bid Rate Bid Request was made:
(A) Date of Bid Rate Loan
(which is a Business Day) ______ ______
(B) Interest Period and the last
day thereof ______ ______
(C) Principal Amount of
Bid Rate Loan $_____ $_____
Very truly yours,
SUNTRUST BANK, ATLANTA, as
Agent
By:
----------------------------------------
Title:
------------------------------------
----------------
(1) Each Bid Rate Bid must be received by the Agent not later than 12:00
noon, Atlanta, Georgia time, on the Business Day of a proposed Bid Rate Loan.
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EXHIBIT F
FORM OF BID RATE BID LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below,
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, [Name of Lender], refers to the Credit Agreement dated
as of March 31, 1998 (as it may hereafter be amended, modified, extended or
restated from time to time, the "Credit Agreement"), among XXXXXXX FURNITURE
COMPANIES, INC. (the "Borrower"), the financial institutions party thereto as
Lenders, SunTrust Bank, Atlanta, as Agent, and FIRST UNION NATIONAL BANK and
NATIONSBANK, N.A., as Co-Agents. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement. The undersigned hereby makes a Bid Rate Bid or Bid Rate Bids, as the
case may be, pursuant to Section 2.09(b) of the Credit Agreement, in response to
the Bid Rate Bid Request made by the Borrower on __________ ___, 19___, and in
that connection sets forth below the terms on which such Bid Rate Bid or Bid
Rate Bids is or are made:
(A) Interest Period and last
day thereof ______ ______
(B) Principal Amount(1) $______ $______
(C) Bid Rate ______ ______
[In the event bids are accepted for more than one Interest Period in
respect of which bids are set forth above, the aggregate principal amount of Bid
Rate Advances made pursuant to Bid Rate Bids submitted hereby shall not exceed
$_______ (2)].
-----------------
(1) Not less than $2,000,000 or greater than the requested Bid Rate Loan
and in integral multiples of $100,000. Multiple bids will be accepted by the
Agent not to exceed two.
(2) Not less than $2,000,000 and in integral multiples of $100,000.
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The undersigned hereby confirms that it is prepared, subject to the
conditions set forth in the Credit Agreement to extend credit to the Borrower
upon acceptance by the Borrower of this bid in accordance with Section 2.09(d)
of the Credit Agreement.
Very truly yours,
[NAME OF LENDER]
By:
--------------------------------------
Title:
------------------------------------
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EXHIBIT G
FORM OF BID ACCEPT/REJECT LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention:
Ladies and Gentlemen:
The undersigned, XXXXXXX FURNITURE COMPANIES, INC. (the "Borrower"),
refers to the Credit Agreement dated as of March 31, 1998 (as it may hereafter
be amended, modified, extended or restated from time to time, the "Credit
Agreement"), among the Borrower, the financial institutions party thereto as
Lenders, SunTrust Bank, Atlanta, as Agent, and First Union National Bank and
NationsBank, N.A., as Co-Agents. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.
In accordance with Section 2.09(c) of the Credit Agreement, we have
received a summary of bids in connection with our Bid Rate Bid Request dated
_______ ___, 19__ and in accordance with Section 2.09(d) of the Credit
Agreement, we hereby accept the following bids for the Interest Periods
specified below:
1. Interest Period commencing [date] and ending [date]
Aggregate Principal Amount of Bids Accepted, if in Excess of Aggregate
Amount Requested in Bid Rate Bid Request, is $_______.(1)
Accepted Bids:
Principal Amount Interest Rate Lender
$ --%
$ --%
-------------
(1) Must be prorated amongst Lenders as provided in Section 2.09(d).
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[2. Interest Period commencing [date] and ending [date]
Aggregate Principal Amount of Bids Accepted, if in Excess of Aggregate
Amount Requested in Bid Rate Bid Request, is $_________.(2)
Accepted Bids:
Principal Amount Interest Rate Lender
$ --%
$ --%
]
All Bid Rate Bids received but not listed above as accepted are hereby
deemed rejected.
[Insert special instructions, if any, with respect to the apportionment
of the Borrower's acceptance among bids by a Lender for different Interest
Periods]
Very truly yours,
XXXXXXX FURNITURE COMPANIES, INC.
By:
-----------------------------------------
Name:
Title:
-------------------
(2) Must be prorated amongst Lenders as provided in Section 2.09(d).
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EXHIBIT H
SUBSIDIARY GUARANTY AGREEMENT
This SUBSIDIARY GUARANTY AGREEMENT (this "Guaranty"), dated as
of March 31, 1998, made by HAVERTYS CREDIT SERVICES, INC., a Tennessee
corporation (together with each Additional Guarantor becoming a party hereto,
being herein collectively referred to as the "Guarantors") in favor of (i)
SUNTRUST BANK, ATLANTA, a Georgia banking corporation (the "Agent"), in its
capacity as agent for banks and other lending institutions parties to the Credit
Agreement (as hereinafter defined) and each assignee thereof becoming a "Lender"
as provided therein (the "Lenders"), (ii) the Lenders and (iii) FIRST UNION
NATIONAL BANK and NATIONSBANK, N.A., in their capacities as co-agents for the
Lenders (the "Co-Agents"; the Lenders, the Agent and the Co-Agents being
collectively referred to herein as the "Guaranteed Parties");
W I T N E S S E T H:
WHEREAS, Xxxxxxx Furniture Companies, Inc., a Maryland
corporation ("Haverty"), the Lenders, the Co-Agents and the Agent have entered
into that certain Credit Agreement dated as of March 31, 1998 (as the same may
hereafter be amended, restated, supplemented or otherwise modified from time to
time, and including all schedules, riders, and supplements thereto, the "Credit
Agreement"; terms defined therein and not otherwise defined herein being used
herein as therein defined)
WHEREAS, Haverty owns, directly or indirectly, all or a
majority of the outstanding capital stock of each of the Guarantors;
WHEREAS, Haverty and Guarantors share an identity of interest
as members of a consolidated group of companies engaged in substantially similar
businesses with Haverty providing certain centralized financial, accounting and
management services to each of the Guarantors;
WHEREAS, consummation of the transactions pursuant to the
Credit Agreement will enhance the overall financial strength and stability of
Haverty's entire corporate group, including the Guarantors;
WHEREAS, it is a condition precedent to the Lenders'
obligations to enter into the Credit Agreement and to make extensions of credit
thereunder that Guarantors execute and deliver this Guaranty, and Guarantors
desire to execute and deliver this Guaranty to satisfy such condition precedent;
NOW, THEREFORE, in consideration of the premises and in order
to induce the Lenders to enter into and perform their obligations under the
Credit Agreement, the Guarantors hereby jointly and severally agree as follows:
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SECTION 1. GUARANTY. The Guarantors hereby jointly and
severally, irrevocably and unconditionally, guarantee the punctual payment when
due, whether at stated maturity, by acceleration or otherwise, of all Loans and
all other Obligations owing by Haverty to the Lenders or the Agent, or any of
them, under the Letter of Credit Obligations, Credit Agreement, the Notes and
the other Credit Documents, including, without limitation, all renewals,
extensions, modifications and refinancings thereof, now or hereafter owing,
whether for principal, interest, fees, expenses or otherwise, and any and all
reasonable out-of-pocket expenses (including reasonable attorneys' fees actually
incurred and expenses) incurred by the Agent in enforcing any rights under this
Guaranty (collectively, the "Guaranteed Obligations"), including without
limitation, all interest which, but for the filing of a petition in bankruptcy
with respect to Haverty, would accrue on any principal portion of the Guaranteed
Obligations. Any and all payments by the Guarantors hereunder shall be made free
and clear of and without deduction for any set-off, counterclaim, or withholding
so that, in each case, each Guaranteed Party will receive, after giving effect
to any Taxes (as such term is defined in the Credit Agreement, but excluding
Taxes imposed on overall net income of the Guaranteed Party to the same extent
as excluded pursuant to the Credit Agreement), the full amount that it would
otherwise be entitled to receive with respect to the Guaranteed Obligations (but
without duplication of amounts for Taxes already included in the Guaranteed
Obligations). The Guarantors acknowledge and agree that this is a guarantee of
payment when due, and not of collection, and that this Guaranty may be enforced
up to the full amount of the Guaranteed Obligations without proceeding against
Haverty, against any security for the Guaranteed Obligations, against any other
Guarantor or under any other guaranty covering any portion of the Guaranteed
Obligations.
SECTION 2. GUARANTY ABSOLUTE. The Guarantors guarantee that
the Guaranteed Obligations will be paid strictly in accordance with the terms of
the Credit Documents, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the
rights of any Guaranteed Party with respect thereto. The liability of each
Guarantor under this Guaranty shall be absolute and unconditional in accordance
with its terms and shall remain in full force and effect without regard to, and
shall not be released, suspended, discharged, terminated or otherwise affected
by, any circumstance or occurrence whatsoever, including, without limitation,
the following (whether or not such Guarantor consents thereto or has notice
thereof):
(a) any change in the time, place or manner of payment of, or
in any other term of, all or any of the Guaranteed Obligations, any
waiver, indulgence, renewal, extension, amendment or modification of or
addition, consent or supplement to or deletion from or any other action
or inaction under or in respect of the Credit Agreement, the other
Credit Documents, or any other documents, instruments or agreements
relating to the Guaranteed Obligations or any other instrument or
agreement referred to therein or any assignment or transfer of any
thereof;
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(b) any lack of validity or enforceability of the Credit
Agreement, the other Credit Documents, or any other document,
instrument or agreement referred to therein or any assignment or
transfer of any thereof;
(c) any furnishing to the Guaranteed Parties of any additional
security for the Guaranteed Obligations, or any sale, exchange, release
or surrender of, or realization on, any security for the Guaranteed
Obligations;
(d) any settlement or compromise of any of the Guaranteed
Obligations, any security therefor, or any liability of any other party
with respect to the Guaranteed Obligations, or any subordination of the
payment of the Guaranteed Obligations to the payment of any other
liability of Haverty;
(e) any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding relating
to any Guarantor or Haverty, or any action taken with respect to this
Guaranty by any trustee or receiver, or by any court, in any such
proceeding;
(f) any nonperfection of any security interest or lien on any
collateral, or any amendment or waiver of or consent to departure from
any guaranty or security, for all or any of the Guaranteed Obligations;
(g) any application of sums paid by Haverty or any other
Person with respect to the liabilities of Haverty to the Guaranteed
Parties, regardless of what liabilities of Haverty remain unpaid;
(h) any act or failure to act by any Guaranteed Party which
may adversely affect a Guarantor's subrogation rights, if any, against
Haverty to recover payments made under this Guaranty; and
(i) any other circumstance which might otherwise constitute a
defense available to, or a discharge of, any Guarantor.
If claim is ever made upon any Guaranteed Party for repayment or recovery of any
amount or amounts received in payment or on account of any of the Guaranteed
Obligations, and any Guaranteed Party repays all or part of said amount by
reason of (a) any judgment, decree or order of any court or administrative body
having jurisdiction over the Guaranteed Party or any of its property, or (b) any
settlement or compromise of any such claim effected by the Guaranteed Party with
any such claimant (including Haverty or a trustee in bankruptcy for Haverty),
then and in such event the Guarantors agree that any such judgment, decree,
order, settlement or compromise shall be binding on it, notwithstanding any
revocation hereof or the cancellation of the Credit Agreement, the other Credit
Documents, or any other instrument evidencing any liability of Haverty, and the
Guarantors shall be and remain liable to the Guaranteed Party for the
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amounts so repaid or recovered to the same extent as if such amount had never
originally been paid to the Guaranteed Party.
SECTION 3. WAIVER. The Guarantors hereby waive notice of
acceptance of this Guaranty, notice of any liability to which it may apply, and
further waive presentment, demand of payment, protest, notice of dishonor or
nonpayment of any such liabilities, suit or taking of other action by the
Guaranteed Parties against, and any other notice to, Haverty or any other party
liable with respect to the Guaranteed Obligations (including the Guarantors or
any other Person executing a guaranty of the obligations of Haverty).
SECTION 4. WAIVER OF SUBROGATION; CONTRIBUTION. No Guarantor
will exercise any rights against Haverty which it may acquire by way of
subrogation or contribution, by any payment made hereunder or otherwise and each
of the Guarantors hereby expressly waives any claim, right or remedy which the
Guarantors may now have or hereafter acquire against Haverty that arises
hereunder and/or from the performance by the Guarantors hereunder, including,
without limitation, any claim, right or remedy of any Guaranteed Party against
Haverty or any security which any Guaranteed Party now has or hereafter
acquires, whether or not such claim, right or remedy arises in equity, under
contract, by statute, under color of law or otherwise unless and until the
Guaranteed Obligations have been indefeasibly paid in full.
In the event that any Guarantor (the "Funding Guarantor")
shall make any pay ment or payments under this Guaranty or shall suffer any loss
as a result of any realization upon any collateral granted by it to secure its
obligations hereunder, each other Guarantor (each, a "Contributing Guarantor")
hereby agrees to contribute to the Funding Guarantor an amount equal to such
Contributing Guarantor's pro rata share of such payment or payments made, or
losses suffered, by such Funding Guarantor determined by reference to the ratio
of (a) the dollar amount of the percentage of each such Contributing Guarantor's
Net Assets (without giving effect to any right to receive any contribution or
subrogation or obligation to make any contribution hereunder), to (b) the sum of
the Net Assets of all Guarantors (including the Funding Guarantor) hereunder
(without giving effect to any right to receive contribution or subrogation
hereunder or any obligation to make any contribution hereunder); provided, that
the Contributing Guarantor shall not be obligated to make any such payment to
the Funding Guarantor if the Contributing Guarantor is not solvent at the time
of such contribution or if the Contributing Guarantor would be rendered not
solvent as a result thereof. Nothing in this Section shall affect each
Guarantor's several liability for the entire amount of the Guaranteed
Obligations, subject only to the limitations set forth in Section 14. For the
purposes of this Section 4, (x) the "Net Assets" of any Guarantor shall mean the
highest amount, as of any Determination Date, by which (A) the aggregate present
fair saleable value of the assets of such Guarantor exceeds (B) the amount of
all the debts and liabilities of such Guarantor (including contingent,
subordinated, unmatured and unliquidated liabilities, but excluding the
obligations of such Guarantor hereunder), and (y) "Determination Date" shall
mean each of (1) the Closing Date, (2) the date of commencement of a case under
the Bankruptcy Code in which a Guarantor is a debtor, and (3) the date
enforcement hereunder is sought with respect to such Guarantor. Each Funding
Guarantor covenants and
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agrees that its right to receive any contribution from any Contributing
Guarantor hereunder shall be subordinated and junior in right of payment in full
of all of the Guaranteed Obligations.
SECTION 5. SEVERABILITY. Any provision of this Guaranty which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
SECTION 6. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Guaranty nor consent to any departure by a Guarantor therefrom
shall in any event be effective unless the same shall be in writing executed by
the Agent.
SECTION 7. NOTICES. All notices and other communications
provided for hereunder shall be given in the manner specified in the Credit
Agreement (i) in the case of the Agent, at the address specified for the Agent
in the Credit Agreement, and (ii) in the case of the Guarantors, at the
respective addresses specified for such Guarantors in this Guaranty.
SECTION 8. NO WAIVER; REMEDIES. No failure on the part of the
Agent or other Guaranteed Parties to exercise, and no delay in exercising, any
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right. No notice to or demand on any
Guarantor in any case shall entitle such Guarantor to any other further notice
or demand in any similar or other circumstances or constitute a waiver of the
rights of the Agent or other Guaranteed Parties to any other or further action
in any circumstances without notice or demand. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
SECTION 9. WAIVER OF RIGHT OF SETOFF. By acceptance of this
Guaranty, each Guaranteed Party hereby waives, with respect to the Guaranteed
Obligations, any contractual or common law right of setoff against any deposits
of any Guarantor now or hereafter held by and other indebtedness or property
then or thereafter owing by such Guaranteed Party to any Guarantor.
SECTION 10. CONTINUING GUARANTY; TRANSFER OF OBLIGATIONS. This
Guaranty is a continuing guaranty and shall (i) remain in full force and effect
until payment in full of the Guaranteed Obligations and all other amounts
payable under this Guaranty and the termination of the Commitments, (ii) be
binding upon each Guarantor, its successors and assigns, and (iii) inure to the
benefit of and be enforceable by the Agent, its successors, transferees and
assigns, for the benefit of the Guaranteed Parties, provided that no transfer
shall be effective unless such transfer is made pursuant to the terms of the
Credit Agreement.
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SECTION 11. GOVERNING LAW; APPOINTMENT OF AGENT FOR SERVICE OF
PROCESS; SUBMISSION TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) THIS GUARANTY AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAWS OF THE STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW
PRINCIPLES THEREOF).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
GUARANTY OR OTHERWISE RELATED HERETO MAY BE BROUGHT IN THE SUPERIOR COURT OF
XXXXXX COUNTY OF THE STATE OF GEORGIA OR OF THE UNITED STATES OF AMERICA FOR THE
NORTHERN DISTRICT OF GEORGIA, AND, BY EXECUTION AND DELIVERY OF THIS GUARANTY,
EACH GUARANTOR HEREBY CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
THE JURISDICTION OF THE AFORESAID COURTS SOLELY FOR THE PURPOSE OF ADJUDICATING
ITS RIGHTS OR THE RIGHTS OF THE AGENT AND OTHER GUARANTEED PARTIES WITH RESPECT
TO THIS GUARANTY OR ANY DOCUMENT RELATED HERETO. EACH GUARANTOR HEREBY
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS IN RESPECT OF THIS GUARANTY OR ANY DOCUMENT RELATED
THERETO. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE GUARANTEED PARTIES TO
COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY GUARANTOR IN ANY
OTHER JURISDICTION.
(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH GUARANTOR
HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING
OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS GUARANTY OR ANY OTHER
CREDIT DOCUMENT OR ANY MATTER ARISING IN CONNECTION HEREUNDER OR THEREUNDER.
(d) Nothing herein shall affect the right of the Guaranteed
Parties or any holder of a Note to commence legal proceedings or otherwise
proceed against any Guarantor in any other jurisdiction.
SECTION 12. SUBORDINATION OF HAVERTY'S OBLIGATIONS TO THE
GUARANTORS. As an independent covenant, each Guarantor hereby expressly
covenants and agrees for the benefit of the Agent and other Guaranteed Parties
that all obligations and liabilities of Haverty to such Guarantor of whatsoever
description including, without limitation, all intercompany receivables of such
Guarantor from Haverty ("Junior Claims") shall be subordinate and junior in
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right of payment to all obligations of Haverty to the Agent and other Guaranteed
Parties under the terms of the Credit Agreement and the other Credit Documents
("Senior Claims").
If an Event of Default shall occur, then, unless and until
such Event of Default shall have been cured, waived, or shall have ceased to
exist, no direct or indirect payment (in cash, property, securities by setoff or
otherwise) shall be made by Haverty to any Guarantor on account of or in any
manner in respect of any Junior Claim except such payments and distributions the
proceeds of which shall be applied to the payment of Senior Claims.
In the event of a Proceeding (as hereinafter defined), all
Senior Claims shall first be paid in full before any direct or indirect payment
or distribution (in cash, property, securities by setoff or otherwise) shall be
made to any Guarantor on account of or in any manner in respect of any Junior
Claim except such payments and distributions the proceeds of which shall be
applied to the payment of Senior Claims. For the purposes of the previous
sentence, "Proceeding" means Haverty or any Guarantor shall commence a voluntary
case concerning itself under the Bankruptcy Code or any other applicable
bankruptcy laws; or any involuntary case is commenced against Haverty or any
Guarantor; or a custodian (as defined in the Bankruptcy Code or any other
applicable bankruptcy laws) is appointed for, or takes charge of, all or any
substantial part of the property of Haverty or any Guarantor, or Haverty or any
Guarantor commences any other proceedings under any reorganization arrangement,
adjustment of debt, relief of debtor, dissolution, insolvency or liquidation or
similar law of any jurisdiction whether now or hereafter in effect relating to
Haverty or any Guarantor, or any such proceeding is commenced against Haverty or
any Guarantor, or Haverty or any Guarantor is adjudicated insolvent or bankrupt;
or any order of relief or other order approving any such case or proceeding is
entered; or Haverty or any Guarantor suffers any appointment of any custodian or
the like for it or any substantial part of its property; or Haverty or any
Guarantor makes a general assignment for the benefit of creditors; or Haverty or
any Guarantor shall fail to pay, or shall state that it is unable to pay, or
shall be unable to pay, its debts generally as they become due; or Haverty or
any Guarantor shall call a meeting of its creditors with a view to arranging a
composition or adjustment of its debts; or Haverty or any Guarantor shall by any
act or failure to act indicate its consent to, approval of or acquiescence in
any of the foregoing; or any corporate action shall be taken by Haverty or any
Guarantor for the purpose of effecting any of the foregoing.
In the event any direct or indirect payment or distribution is
made to a Guarantor in contravention of this Section 12, such payment or
distribution shall be deemed received in trust for the benefit of the Agent and
other Guaranteed Parties and shall be immediately paid over to the Agent for
application against the Guaranteed Obligations in accordance with the terms of
the Credit Agreement.
Each Guarantor agrees to execute such additional documents as
the Agent may reasonably request to evidence the subordination provided for in
this Section 12.
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SECTION 13. AUTOMATIC ACCELERATION IN CERTAIN EVENTS. Upon the
occurrence of an Event of Default specified in Section 8.07 of the Credit
Agreement, all Guaranteed Obligations shall automatically become immediately due
and payable by the Guarantors, without notice or other action on the part of the
Agent or other Guaranteed Parties, and regardless of whether payment of the
Guaranteed Obligations by Haverty has then been accelerated. In addition, if any
event of the types described in Section 8.07 of the Credit Agreement should
occur with respect to any Guarantor, then the Guaranteed Obligations shall
automatically become immediately due and payable by such Guarantor, without
notice or other action on the part of the Agent or other Guaranteed Parties, and
regardless of whether payment of the Guaranteed Obligations by Haverty has then
been accelerated.
SECTION 14. SAVINGS CLAUSE. (a) It is the intent of each
Guarantor and the Guaranteed Parties that each Guarantor's maximum obligations
hereunder shall be, but not in excess of:
(i) in a case or proceeding commenced by or against
such Guarantor under the Bankruptcy Code on or within one year from the
date on which any of the Guaranteed Obligations are incurred, the
maximum amount which would not otherwise cause the Guaranteed
Obligations (or any other obligations of such Guarantor to the
Guaranteed Parties) to be avoidable or unenforceable against such
Guarantor under (A) Section 548 of the Bankruptcy Code or (B) any state
fraudulent transfer or fraudulent conveyance act or statute applied in
such case or proceeding by virtue of Section 544 of the Bankruptcy
Code; or
(ii) in a case or proceeding commenced by or against
such Guarantor under the Bankruptcy Code subsequent to one year from
the date on which any of the Guaranteed Obligations are incurred, the
maximum amount which would not otherwise cause the Guaranteed
Obligations (or any other obligations of the Guarantor to the
Guaranteed Parties) to be avoidable or unenforceable against such
Guarantor under any state fraudulent transfer or fraudulent conveyance
act or statute applied in any such case or proceeding by virtue of
Section 544 of the Bankruptcy Code; or
(iii) in a case or proceeding commenced by or against
such Guarantor under any law, statute or regulation other than the
Bankruptcy Code (including, without limitation, any other bankruptcy,
reorganization, arrangement, moratorium, readjustment of debt,
dissolution, liquidation or similar debtor relief laws), the maximum
amount which would not otherwise cause the Guaranteed Obligations (or
any other obligations of such Guarantor to the Guaranteed Parties) to
be avoidable or unenforceable against such Guarantor under such law,
statute or regulation including, without limitation, any state
fraudulent transfer or fraudulent conveyance act or statute applied in
any such case or proceeding.
-8-
129
(The substantive laws under which the possible avoidance or unenforceability of
the Guaranteed Obligations (or any other obligations of such Guarantor to the
Guaranteed Parties) shall be determined in any such case or proceeding shall
hereinafter be referred to as the "Avoidance Provisions").
(b) To the end set forth in Section 14(a), but only to the
extent that the Guaranteed Obligations would otherwise be subject to
avoidance under the Avoidance Provisions if such Guarantor is not
deemed to have received valuable consideration, fair value or
reasonably equivalent value for the Guaranteed Obligations, or if the
Guaranteed Obligations would render the Guarantor insolvent, or leave
the Guarantor with an unreasonably small capital to conduct its
business, or cause the Guarantor to have incurred debts (or to have
intended to have incurred debts) beyond its ability to pay such debts
as they mature, in each case as of the time any of the Guaranteed
Obligations are deemed to have been incurred under the Avoidance
Provisions and after giving effect to contribution as among Guarantors,
the maximum Guaranteed Obligations for which such Guarantor shall be
liable hereunder shall be reduced to that amount which, after giving
effect thereto, would not cause the Guaranteed Obligations (or any
other obligations of such Guarantor to the Guaranteed Parties), as so
reduced, to be subject to avoidance under the Avoidance Provisions.
This Section 14(b) is intended solely to preserve the rights of the
Guaranteed Parties hereunder to the maximum extent that would not cause
the Guaranteed Obligations of any Guarantor to be subject to avoidance
under the Avoidance Provisions, and neither such Guarantor nor any
other Person shall have any right or claim under this Section 14 as
against the Guaranteed Parties that would not otherwise be available to
such Person under the Avoidance Provisions.
(c) None of the provisions of this Section 14 are intended in
any manner to alter the obligations of any holder of Subordinated Debt
or the rights of the holders of "senior indebtedness" as provided by
the terms of the Subordinated Debt. Accordingly, it is the intent of
each of the Guarantors that, in the event that any payment or
distribution is made with respect to the Subordinated Debt prior to the
payment in full of the Guaranteed Obligations by virtue of the
provisions of this Section 14, in any case or proceeding of the kinds
described in clauses (i)-(iii) of Section 14(a), the holders of the
Subordinated Debt shall be obligated to pay or deliver such payment or
distribution to or for the benefit of the Guaranteed Parties.
Furthermore, in respect of the Avoidance Provisions, it is the intent
of each Guarantor that the subrogation rights of the holders of
Subordinated Debt with respect to the obligations of the Guarantor
under this Guaranty, be subject in all respects to the provisions of
Section 14(b).
SECTION 15. INFORMATION. Each of the Guarantors assumes all
responsibility for being and keeping itself informed of Haverty's financial
condition and assets, and of all other circumstances bearing upon the risk of
nonpayment of the Guaranteed Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder, and
-9-
130
agrees that none of the Guaranteed Parties will have any duty to advise any of
the Guarantors of information known to it or any of them regarding such
circumstances or risks.
SECTION 16. REPRESENTATIONS AND WARRANTIES. Each Guarantor
represents and warrants as to itself that all representations and warranties
relating to it contained in Sections 5.01 through 5.06 of the Credit Agreement
are true and correct.
SECTION 17. SURVIVAL OF AGREEMENT. All agreements,
representations and warranties made herein shall survive the execution and
delivery of this Guaranty and the Credit Agreement, the making of the Loans and
the execution and delivery of the Notes and the other Credit Documents.
SECTION 18. COUNTERPARTS. This Guaranty and any amendments,
waivers, consents or supplements may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument.
SECTION 19. ADDITIONAL GUARANTORS. Upon execution and delivery
by any Subsidiary of Haverty of an instrument in the form of Annex 1, such
Subsidiary of Haverty shall become a Guarantor hereunder with the same force and
effect as if originally named a Guarantor herein (each an "Additional
Guarantor"). The execution and delivery of any such instrument shall not require
the consent of any Guarantor hereunder. The rights and obligations of each
Guarantor hereunder shall remain in full force and effect notwithstanding the
addition of any Additional Guarantor as a party to this Guaranty.
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131
IN WITNESS WHEREOF, each Guarantor and the Agent have caused
this Guaranty to be duly executed and delivered by their respective duly
authorized officers as of the date first above written.
Address for Notices: HAVERTYS CREDIT SERVICES, INC.
(a "Guarantor")
000 Xxxx Xxxxxxxxx Xx., X.X. By:
Xxxxxxx, Xxxxxxx 00000-0000 -------------------------------------
Xxxxx X. Xxxxxx
President
Attest:
--------------------------------
Xxxxxx X. Xxxxxx, Xx.
Secretary
[SIGNATURE PAGE TO SUBSIDIARY GUARANTY AGREEMENT]
132
ACCEPTED:
SUNTRUST BANK, ATLANTA, as Agent
By:
------------------------------------
Title:
--------------------------------
By:
------------------------------------
Title:
--------------------------------
[CORPORATE SEAL]
[SIGNATURE PAGE TO SUBSIDIARY GUARANTY AGREEMENT]
133
SECTION 12 OF THE GUARANTY
HEREBY ACKNOWLEDGED AS OF THE
DATE FIRST ABOVE WRITTEN:
XXXXXXX FURNITURE COMPANIES, INC.
By:
------------------------------
Xxxxxx X. Xxxx
Executive Vice President
[SIGNATURE PAGE TO SUBSIDIARY GUARANTY AGREEMENT]
134
EXHIBIT I
FORM OF CLOSING CERTIFICATE
CLOSING CERTIFICATE
Pursuant to Section 4.01 of the Credit Agreement dated as of March 31,
1998 (the "Credit Agreement") among XXXXXXX FURNITURE COMPANIES, INC., a
Maryland corporation ("Haverty"), SUNTRUST BANK, ATLANTA, a Georgia banking
corporation, as Agent, FIRST UNION NATIONAL BANK and NATIONSBANK, N.A., as
Co-Agents, and the other banks and lending institutions listed on the signature
pages thereto, the undersigned in their respective capacities as officers,
directors, or authorized signatories of Haverty hereby certify to the Lenders,
the Agent and the Co-Agents as follows (capitalized terms used herein having the
same meanings as assigned to such terms in the Credit Agreement):
1. All representations and warranties contained in the Credit Agreement are true
and correct in all material respects on and as of the date hereof.
2. After giving effect to the Loans to be made or deemed to be made to Haverty
pursuant to the Credit Agreement on the date hereof, no Default or Event of
Default has occurred and is continuing.
3. Since the date of the audited financial statements of the Consolidated
Companies described in Section 5.13 of the Credit Agreement, there has been no
change which has had or could reasonably be expected to have a Materially
Adverse Effect.
4. Except as may be described on Schedule 5.05 of the Credit Agreement, no
action or proceeding has been instituted or is pending before any court or other
governmental authority, or, to the knowledge of Haverty, threatened (i) which
reasonably could be expected to have a Materially Adverse Effect, or (ii)
seeking to prohibit or restrict one or more Credit Party's ownership or
operation of any portion of its businesses or assets, where such portion or
portions of such businesses or assets, as the case may be, constitute a material
portion of the total businesses or assets of the Consolidated Companies.
5. The Loans to be made on the date hereof are being used solely for the
purposes provided in the Credit Agreement, and such Loans and use of proceeds
thereof will not contravene, violate or conflict with, or involve the Agent or
any Lender in a violation of, any law, rule, injunction, or regulation, or
determination of any court of law or other governmental authority, applicable to
Haverty.
6. The conditions precedent set forth in Sections 4.01 and 4.02 of the Credit
Agreement have been or will be satisfied (or have been waived pursuant to the
terms of the Credit Agreement) prior to or concurrently with the making of the
Loans under the Credit Agreement on the date hereof.
135
7. The execution, delivery and performance by the Credit Parties of the Credit
Documents will not violate any Requirement of Law or cause a breach or default
under any of their respective Contractual Obligations.
8. Each of the Credit Parties has the corporate power and authority to make,
deliver and perform the Credit Documents to which it is a party and has taken
all necessary corporate action to authorize the execution, delivery and
performance of such Credit Documents. No consents or authorization of, or filing
with, any Person (including, without limitation, any governmental authority), is
required in connection with the execution, delivery or performance by any Credit
Party, or the validity or enforceability against any Credit Party, of the Credit
Documents, other than such consents, authorizations or filings which have been
made or obtained.
This Certificate executed and delivered on behalf of Haverty this 31st
day of March, 1998.
Xxxxxx X. Xxxx
Executive Vice President
136
EXHIBIT J
, 1998
SunTrust Bank, Atlanta, As Agent
00 Xxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
First Union National Bank, As Co-Agent
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
NationsBank, N.A., As Co-Agent
Corporate Finance
NationsBank Plaza
000 Xxxxxxxxx Xxxxxx, XX, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
And the Lenders from time to time party to
The Credit Agreement hereafter described
Re: Credit Agreement dated as of , 1998, among Xxxxxxx
Furniture Companies, Inc., each of the Lenders listed on the
signature pages thereto, SunTrust Bank, Atlanta, as Agent and
and as Co-Agents (the "Credit Agreement")
Ladies and Gentlemen:
We have acted as counsel to Xxxxxxx Furniture Companies, Inc., a Maryland
corporation (the "Borrower"), and Havertys Credit Services, Inc., a Tennessee
corporation (the "Guarantor"), in connection with the execution and delivery of
the Credit Agreement. This opinion is furnished pursuant to Section 4.01(k) of
the Credit Agreement. Unless otherwise defined herein, terms used herein shall
have the meanings ascribed to them in the Credit Agreement.
In connection with giving the opinions set forth herein, we have examined
originals or documents certified, or otherwise identified to our satisfaction,
as copies of the originals of the following documents:
1. The Credit Agreement;
2. The Revolving Notes;
000
XxxXxxxx Xxxx, Xxxxxxx, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
, 1998
Page 2
3. The Bid Facility Notes;
4. The Swing Line Note;
5. The Guaranty Agreement (the "Guaranty" and collectively, with the
Credit Agreement and the Revolving Notes, the Bid Facility Notes and
the Swing Line Note, the "Transaction Documents");
6. The respective Articles of Incorporation and Bylaws of each of the
Borrower and Guarantor and all amendments to such Articles of
Incorporation and Bylaws;
7. The respective corporate minute books of each of the Borrower and
Guarantor certified to us as complete and correct;
8. Corporate proceedings of each of the Borrower and Guarantor relating
to the execution and delivery of the Transaction Documents;
9. Certificate of Good Standing with respect to the Borrower issued by
the Secretary of State of the State of Maryland, dated as of ,
1998 (the "Maryland Certificate");
10. Certificate of Good Standing with respect to the Guarantor issued by
the Secretary of State of the State of Tennessee, dated as of ,
1998 (the "Tennessee Certificate");
11. Certificate of Good Standing with respect to the Borrower issued by
the Secretary of State of the State of Georgia, dated as of ,
1998 (the "Georgia Certificate"); and
12. The Material Agreements (as defined below).
This opinion letter is governed by, and shall be interpreted in accordance
with, the January 1, 1992 edition of the Interpretive Standards Applicable to
Certain Legal Opinions to Third Parties in Corporate Transactions adopted by
the Legal Opinion Committee of the Corporate and Banking Law Section of the
State Bar of Georgia (the "Interpretive Standards"), which Interpretive
Standards are incorporated in this opinion letter by this reference. As a
consequence, this opinion letter is subject to a number of qualifications,
exceptions, definitions, limitations on coverage and other limitations, all as
more particularly described in the Interpretive Standards, and this opinion
letter should be read in conjunction therewith.
138
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
_______________, 1998
Page 3
In our examination of documents for the purpose of rendering the opinions
set forth below, we have assumed the genuineness of all signatures other than
those on the Transaction Documents for or on behalf of the Borrower and
Guarantor, the authenticity of all documents submitted to us as originals, the
conformity with the originals of all documents submitted to us as copies, and
the authenticity of such latter documents. As to questions of fact material to
our opinions, we have relied, with your permission, and without independent
verification of the accuracy or completeness thereof, solely upon (i) the
contents of the Borrower's and Guarantor's respective corporate minute book, as
described in item 7 above; (ii) the statements and representations of certain
corporate officers of the Borrower and Guarantor set forth in the Officer's
Certificates attached hereto as Exhibits "A-2" and "A-1", respectively
(collectively, the "Officer's Certificates"); (iii) the statements and
representations contained in the Maryland Certificate, the Tennessee Certificate
and the Georgia Certificate; and (iv) the Borrower's and Guarantor's respective
statements, representations and warranties contained in the Transaction
Documents.
Whenever our opinion herein is qualified by the phrase "to our knowledge,"
or any other phrase of similar import, it is intended to indicate that the
current actual knowledge of the attorneys within this firm actively engaged in
the representation of the Borrower or the Guarantor is not inconsistent with
that portion of the opinion which such phrase qualifies; our use of such phrases
shall not indicate that we have made, and, in fact we have not made, an
independent investigation concerning the accuracy or veracity of the
representations or warranties or statements of fact contained in any of the
Transaction Documents, the Officer's Certificates, the Maryland Certificate, the
Tennessee Certificate, the Georgia Certificate or any other documents identified
in the preceding paragraph, or that we have made any review of any files,
documents or other materials relating to the Borrower or Guarantor which have
come into our possession in connection with any transactions other than the
transactions contemplated by the Transaction Documents. We have not made any
independent review or investigation of orders, judgments or decrees by which the
Borrower or Guarantor is or may be bound, nor have we made any independent
investigation as to the existence of actions, suits, investigations or
proceedings, if any, pending or threatened against the Borrower, and we have
made no searches of any litigation dockets or any other public records.
Except to the extent set forth in the following sentence, our opinions
herein are limited to the laws of the State of Georgia and the federal laws of
the United States of America. To the extent that the opinions expressed below
involve matters governed by the General Corporation Law of Maryland or the
Tennessee Business Corporation Act, with your permission, we have based our
opinions solely on, and limited our review to, the applicable provisions of
those statutes, as reported and annotated in Aspen Law & Business/Xxxxxxxx-Xxxx
Information Services, Corporation Statutes, State Statutes, Volume 4 and Volume
7 (1994: as updated through January, 1998). We are not admitted to the bar of
any state other than the State of Georgia.
139
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
_______________, 1998
Page 4
Based on and subject to the foregoing and such other qualifications as are
set forth below, we are of the opinion that:
1. The Borrower is a corporation, duly organized, validly existing and,
based solely on our review of the Maryland Certificate, in good standing under
the laws of the State of Maryland. The Guarantor is a corporation, duly
organized, validly existing and, based solely on our review of the Tennessee
Certificate, in good standing under the laws of the State of Tennessee. Based
solely on our review of the Georgia Certificate the Borrower is a corporation
authorized to transact business as a foreign corporation under the laws of the
State of Georgia. As used herein, "good standing" shall mean that all filings
and registrations have been made under the applicable filing and annual
registration provisions under the respective business corporation code of such
entity's state of incorporation, and that all filing fees that are due and
payable thereunder have been paid.
2. Each of the Borrower and the Guarantor has the full corporate power
and corporate authority to execute, deliver and perform all of its respective
obligations under the Credit Agreement and the other Transaction Documents to
which it is a party, and the execution, delivery and performance by the Borrower
and the Guarantor of the Transaction Documents to which it is a party have been
authorized by all necessary corporate action.
3. Each of the Transaction Documents to which it is a party has been duly
executed and delivered by the Borrower and the Guarantor and each of the
Transaction Documents to which it is a party constitutes a legal, valid and
binding obligation of the Borrower and the Guarantor enforceable against
Borrower and Guarantor, as applicable, in accordance with its respective terms.
4. The execution, delivery and performance by the Borrower and Guarantor
of the Transaction Documents to which it is a party in accordance with their
respective terms will not:
(i) violate any provision of its respective Articles of Incorporation
or Bylaws:
(ii) violate any laws, ordinances, governmental rules or regulations
applicable to it or its respective property;
(iii) result in the breach of or constitute a default under any
Material Agreement (the term "Material Agreement," as used herein, shall mean
each of the agreements which has been filed with the Securities and Exchange
Commission as an exhibit (including any document which, in lieu of being filed
as such an exhibit, is incorporated by reference or which the Borrower agrees or
has agreed to provide to the Securities and Exchange Commission upon request) to
the Borrower's most recently filed Annual Report on Form 10-K, or any
subsequently filed report of Borrower on Form 10-Q or Form 8-K,
140
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
_______________, 1998
Page 5
pursuant to the requirements of Item 601(b)(10) of XXX Xxxxxxxxxx X-X, 00 XXX
Sec. 229.601(b)(10), as amended); or
(iv) to our knowledge, result in either (a) the violation of any judicial
or administrative decree, writ, judgment or order to which it or its respective
assets is subject or (b) the creation of or imposition of any contractual lien
in favor of anyone other than the Lenders, the Agent or the Co-Agents upon or
with respect to any of its respective property.
5. No consent, approval, license, exemption of or filing or registration
with any court or governmental department, commission, board,, bureau, agency
or instrumentality is necessary for the valid execution, delivery or
performance by Borrower or the Guarantor of the Transaction Documents to which
it is a party.
6. While the laws of the State of Georgia relating to matters of
interest and usury are not without ambiguities, a court applying the laws of
the State of Georgia in a properly reasoned opinion should conclude that the
Transaction Documents are in compliance with the laws of the State of Georgia;
provided, however, that we express no opinion herein as to any provision of any
Transaction Documents (if any) that may be construed to require or permit
interest to be charged or paid on unpaid interest except to the extent
permitted under Official Code of Georgia Annotated ("O.C.G.A.") Sec.7-4-17.
7. Neither the Borrower nor the Guarantor is an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, or a "subsidiary company" of a "holding company"
or an "affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company" within the meaning of the Public Utility Holding Company Act
of 1935, as amended.
8. The making of any Loans and the application of the proceeds thereof
as provided in the Credit Agreement do not violate Regulation G, T, U or X of
the Board of Governors of the Federal Reserve System.
Our opinions set forth herein are also further limited by the following
exceptions and qualifications:
(i) We have assumed that the only interest, fees and other charges
contracted for or to be reserved, charged, taken or paid in connection with the
loan transaction contemplated by the Transaction Documents are those set forth
in the Transaction Documents and that all such interest, fees and charges will
be reserved, charged, taken and applied by the Lenders solely as described
therein. We also have assumed that no interest shall be reserved, charged,
taken or paid under the Transaction Documents on unpaid interest and that under
no circumstances shall the rate of interest payable under the Transaction
141
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
____________, 1998
Page 6
Documents exceed 5.0% per month (whether due to prepayment, acceleration, lack
of borrowing or otherwise). We also have assumed that the proceeds of the Loans
will be used by the borrower in accordance with the terms of the Credit
Agreement.
(ii) Our opinion with respect to the enforceability of the indemnification
provisions contained in the Transaction Documents is limited by the existence of
a split of judicial authority concerning the enforceability of private
indemnification agreements with respect to liabilities arising under the federal
Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA").
Although a majority of courts which have addressed that issue to date have held
that private parties may apportion by contract any liability arising under
CERCLA, standing decisions by a minority of such courts have held that such
private indemnification agreements cannot be enforced to the extent that they
effectively relieve responsible parties from liabilities expressly allocated by
CERCLA. Neither the United States Supreme Court, the United States Court of
Appeals for the Eleventh Circuit, the Georgia Supreme Court nor any other court
whose decisions would clearly constitute binding authority with respect to
interpretation of the Transaction Documents has addressed this issue.
Accordingly, at present, the enforceability of any indemnification provisions of
the Transaction Documents that purport to cover liabilities created or allocated
under CERCLA, or similar environmental laws, cannot be said to be free from
doubt.
(iii) Our opinion with respect to the enforceability of any of the
Transaction Documents is qualified to the extent enforcement may be limited by
certain other laws and legal and equitable principles of the State of Georgia
and federal law which may limit or render ineffective certain of the rights,
remedies and waivers contained in the Transaction Documents, none of which other
laws or legal or equitable principles should substantially interfere with the
practical realization by the Lenders of the benefits intended to be afforded
under the Transaction Documents.
(iv) with respect to any element of mutuality which may be required in
order to support the enforceability of the Transaction Documents, we have
assumed that the Lenders, the Agent and the Co-Agents have all requisite power
and authority to enter into and perform their respective obligations under the
Credit Agreement and the other Transaction Documents to which they are parties,
that the Credit Agreement and such other Transaction Documents have been duly
authorized, executed and delivered by such Lenders, the Agent and the Co-Agent,
and that the Credit Agreement and such other Transaction Documents constitute
the legal, valid and binding obligations of such Lenders, the Agent and the
Co-Agents.
(v) Our opinion with respect to the enforceability of the Guaranty is also
subject to the effects of laws of the State of Georgia which may, in the absence
of a waiver or consent by a guarantor, discharge such guarantor as a result of
(a) the discharge of the guaranteed obligation, (b) any change in
142
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
____________, 1998
Page 7
the nature or terms of the guaranteed obligations, (c) any release or
compounding with any co-guarantor, (d) any action of a creditor that injures or
increases the risk to which such guarantor is exposed, including any impairment
of collateral for the guaranteed obligation, or (e) any failure by the creditor
to comply with the provisions of O.C.G.A. Section 10-7-23 or Section 10-7-24.
This opinion letter has been delivered solely for the benefit of the Agent,
the Co-Agents, the Lenders and their permitted successors and assigns under the
Transaction Documents in connection with the transactions contemplated by the
Credit Agreement and may not be relied upon by any other person or entity or for
any other purpose without our express prior written permission. We expressly
disclaim any duty to update this opinion letter in the future in the event there
are any changes in relevant fact or law that may change or otherwise affect any
of the opinions expressed herein.
Very truly yours,
XXXXX, XXXXXXXX & XXXXXXX, LLP
By:
------------------------------
Xxxxxx Xxx Xxxxxxxx, a Partner
143
EXHIBIT "A-1"
FORM OF OFFICER'S CERTIFICATE
OFFICER'S CERTIFICATE
OF
HAVERTYS CREDIT SERVICES, INC.
The undersigned, Xxxxx X. Xxxxxx, in his capacity as President of Havertys
Credit Services, Inc., a Tennessee corporation (the "Guarantor"), has executed
this Certificate in connection with the opinion letter (the "Opinion Letter") to
be rendered by Xxxxx, Xxxxxxxx & Xxxxxxx, LLP pursuant to the consummation of
the transactions contemplated by that certain Credit Agreement (the "Credit
Agreement"), dated as of , 1998, between Xxxxxxx Furniture Companies,
Inc., SunTrust Bank, Atlanta, as agent (the "Agent"), and , as
Co-Agents, and the Lenders that are a party thereto (the "Lenders") and that
certain Guaranty dated , 1998 executed by Guarantor in favor of the
Agent, and , as Co-Agents, and the Lenders. The undersigned
authorizes Xxxxx, Xxxxxxxx & Xxxxxxx, LLP to rely on this Certificate in
rendering the Opinion Letter. Capitalized terms set forth in this Certificate
and not otherwise defined herein, shall have the meanings ascribed to them in
the Credit Agreement.
The undersigned hereby certifies that:
1. The following persons are the duly elected and qualified officers of
the Guarantor occupying the office set forth next to his respective name:
President and General Manager: Xxxxx X. Xxxxxx
Secretary and Treasurer: Xxxxxx Xxxxxx, Xx.
2. The corporate minute book of the Guarantor provided to Xxxxx, Xxxxxxxx
& Xxxxxxx, LLP contains a true and correct copy of the Bylaws and Articles of
Incorporation of the Guarantor, and all amendments thereto, if any, and all
minutes of meetings of the shareholders and the Board of Directors of the
Guarantor.
3. The statements, representations and warranties of the Guarantor
contained in the Credit Documents are true and correct in all respects and
Xxxxx, Xxxxxxxx & Xxxxxxx, LLP is entitled to rely thereon in rendering the
Opinion Letter.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as
of , 1998.
------------------------------------
Xxxxx X. Xxxxxx, as President
of Havertys Credit Services, Inc.
144
EXHIBIT "A-2"
FORM OF OFFICER'S CERTIFICATE
OFFICER'S CERTIFICATE
OF
XXXXXXX FURNITURE COMPANIES, INC.
The undersigned, Xxxxxx X. Xxxx, in his capacity as Executive Vice
President of Xxxxxxx Furniture Companies, Inc., a Maryland corporation (the
"Borrower"), has executed this Certificate in connection with the opinion letter
(the "Opinion Letter") to be rendered by Xxxxx, Xxxxxxxx & Xxxxxxx, LLP pursuant
to the consummation of the transactions contemplated by that certain Credit
Agreement (the "Credit Agreement"), dated as of __ , 1998, between
Xxxxxxx Furniture Companies, Inc. and SunTrust Bank, Atlanta, as Agent, ______
and _______, as Co-Agents, and the Lenders that are a party thereto (the
"Lenders") and that certain Guaranty, dated as of , 1998, executed by
Havertys Credit Services, Inc. in favor of the Lenders. The undersigned
authorizes Xxxxx, Xxxxxxxx & Xxxxxxx, LLP to rely on this Certificate in
rendering the Opinion Letter. Capitalized terms set forth in this Certificate
and not otherwise defined herein, shall have the meanings ascribed to them in
the Credit Agreement.
The undersigned hereby certifies that:
1. The following persons are duly elected and qualified officers of the
Borrower occupying the office set forth next to his or her respective name:
President and Chief Executive Officer: Xxxx X. Xxxxxx, Xx.
Executive Vice President and Chief
Financial Officer: Xxxxxx X. Xxxx
Secretary and Vice President,
Finance: Xxxxx X. Xxxxxx
2. The corporate minute book of the Borrower provided to Xxxxx, Xxxxxxxx
& Xxxxxxx, LLP contains a true and correct copy of the Bylaws and Articles of
Incorporation of the Borrower, and all amendments thereto, if any, and all
minutes of meetings of the shareholders and the Board of Directors and the
Executive Committee of Board of Directors of the Borrower.
3. The statements, representations and warranties of the Borrower
contained in the Credit Documents are true and correct in all respects and
Xxxxx, Xxxxxxxx & Xxxxxxx, LLP is entitled to rely thereon in rendering the
Opinion Letter.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
, 1998.
-------------------------------------------
Xxxxxx X. Xxxx, as Executive Vice President
of Xxxxxxx Furniture Companies, Inc.
145
EXHIBIT K
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement dated as of
March 31, 1998 (as may be amended, modified or supplemented to the date hereof,
the "Credit Agreement"), among XXXXXXX FURNITURE COMPANIES, INC., as Borrower
(the "Borrower"), the lenders listed on the signature pages thereof ("Lenders"),
SUNTRUST BANK, ATLANTA, as Agent, and FIRST UNION NATIONAL BANK and NATIONSBANK,
N.A., as Co-Agents. Terms defined in the Credit Agreement are used herein with
the same meanings.
1. Assignor (as identified below) hereby sells and assigns to
Assignee (as identified below), without recourse against
Assignor, and Assignee hereby purchases and assumes from
Assignor, without recourse against Assignor, effective as of
the Effective Date hereinafter set forth, the interests set
forth below (collectively, the "Assigned Interest"), in
Assignor's rights and obligations under the Credit Agreement,
including without limitation, the below specified [Revolving
Loan Commitment] on the Effective Date, and the below
specified [Revolving Loans] [Letter of Credit Obligations]
[Bid Rate Loans] [Swing Line Loans] owing to Assignor that are
outstanding on the Effective Date, together with unpaid
interest accrued on the assigned Loans to the Effective Date,
and the amount (if any) set forth below of the fees referred
to in Section 3.05(b) and (c) of the Credit Agreement accrued
to the Effective Date for the account of Assignor. From and
after the Effective Date, (a) Assignee shall be a party to and
be bound by the provisions of the Credit Agreement, and to the
extent of the interest assigned by this Assignment and
Acceptance, have the rights and obligations of a Lender
thereunder and under the Credit Documents (except for any such
obligations that are due and payable on, or that become due
and payable before, the effectiveness of this Assignment and
Acceptance), and (b) Assignor shall, to the extent of its
interest assigned by this Assignment and Acceptance and
otherwise to the extent set forth in the foregoing clause (a),
relinquish its rights and be released from its obligations
under the Credit Agreement and the Credit Documents.
2. Each of the Assignor and the Assignee represents, warrants and
agrees to and with the other and the Agent as follows: (i)
Assignor warrants that it is the legal and beneficial owner of
the interest being assigned hereby free and clear of any
adverse claim and that its [Revolving Loan Commitment], and
the outstanding balances of its [Loans] [Letter of Credit
Obligations] under each Facility, in each case, without giving
effect to assignments thereof which have not become effective,
are as set forth below, (ii) except as set forth in (i),
Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit
Agreement, or the execution, legality, validity,
enforceability, genuineness, sufficiency or value of the
Credit Agreement or any other Credit Document or any
146
instrument or documents furnished pursuant thereto, or the
financial condition of Haverty or any other Credit Party or
the performance or observance by any Credit Party of any of
its obligations under the Credit Documents; (iii) the Assignee
represents and warrants that it is legally authorized to enter
into this Assignment and Acceptance; (iv) Assignee confirms
that it has received a copy of the Credit Agreement, such
financial statements and other documents and information as it
has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (v)
Assignee agrees that it will perform its obligations as a
Lender under the Credit Documents as required by the terms
thereof; and (vi) Assignee appoints and authorizes the Agent
to take such actions as agent on its behalf and to exercise
such powers under the Credit Agreement and the other Credit
Documents as are delegated to the Agent by the terms of the
Credit Agreement and the other Credit Documents, together with
such powers as are reasonably incidental thereto.
3. This Assignment and Acceptance is being delivered to the
Agent, together with (i) the Notes evidencing the Loans
included in the Assigned Interest, and (ii) a copy of the
Assignment and Acceptance after it is duly executed by each of
the Assignee and the Assignor.
4. This Assignment shall be governed by and construed in
accordance with the laws of the State of Georgia, without
regard to the conflict of laws principles thereof.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address (Including Telex and Telecopy Numbers) for Notices:
Assignee's Lending Office:
147
Effective Date of Assignment (may not be fewer than five (5) Business Days after
the date of the Assignment):
PERCENTAGE OF
PRINCIPAL AMOUNT COMMITMENT
FACILITY ASSIGNED ASSIGNED
-------- ---------------- -------------
Revolving
Loan Facility $ %
Letter of Credit
Facility $ "
Bid Rate
Facility $ "
Swing Line
Facility $ "
Immediately after giving effect to this Assignment:
(a) The aggregate amount of the Revolving Loan Commitment of
Assignor is
--------------------;
(b) The aggregate amount of the Letter of Credit Obligations of the
Assignor is
--------------------;
(c) The aggregate amount of the Bid Rate Loans of the Assignor is
--------------------;
[(d) The aggregate amount of the Swing Line Loans of the Assignor is
--------------------.]
The terms set forth herein are
hereby agreed to by
________________________, as Assignor.
By:
------------------------------------
Name:
Title:
As Assignor
148
The terms set forth herein are
hereby agreed to by
________________________, as Assignee.
By:
-----------------------------------
Name:
Title:
As Assignee
CONSENTED TO:
SUNTRUST BANK, ATLANTA, AS AGENT
By:
------------------------------------
Name:
Title:
XXXXXXX FURNITURE COMPANIES, INC.
By:
-------------------------------------
Name:
Title:
149
ANNEX 1
SUPPLEMENT
TO SUBSIDIARY GUARANTY AGREEMENT
THIS SUPPLEMENT TO SUBSIDIARY GUARANTY AGREEMENT (this
"Supplement to Guaranty Agreement"), dated as of ___________, 19__, made by
______________________, a ________ corporation (the "Additional Guarantor"), in
favor of (i) SUNTRUST BANK, ATLANTA, a Georgia banking corporation (the
"Agent"), in its capacity as agent for banks and other lending institutions
parties to the Credit Agreement (as hereinafter defined) and each assignee
thereof becoming a "Lender" as provided therein (the "Lenders") (ii) and (iii)
FIRST UNION NATIONAL BANK and NATIONSBANK, N.A., in their capacities as
co-agents for the Lenders (the "Co-Agents"; the Lenders, the Agent and the
Co-Agents, being collectively referred to herein as the "Guaranteed Parties").
W I T N E S S E T H:
WHEREAS, certain Subsidiaries (the "Subsidiary Guarantors") of
Haverty have executed and delivered that certain Subsidiary Guaranty Agreement
dated as of March 31, 1998 (the "Subsidiary Guaranty") pursuant to which the
Subsidiary Guarantors have agreed to guarantee all of the obligations of Haverty
under the Credit Agreement and the other Credit Documents (as defined in the
Credit Agreement);
WHEREAS, Haverty, the Subsidiary Guarantors and the Additional
Guarantor share an identity of interests as members of a consolidated group of
companies engaged in substantially similar businesses; Haverty provides certain
centralized financial, accounting and management services to the Additional
Guarantor; and the making of the loans will enhance the overall financial
strength and stability of the Haverty's corporate group, including the
Additional Guarantor;
WHEREAS, it is a condition subsequent to the Lenders'
obligation to make loans to Haverty under the Credit Agreement that the
Additional Guarantor execute and deliver to the Agent this Supplement to
Guaranty Agreement, and the Additional Guarantor desires to execute and deliver
this Supplement to Guaranty Agreement to satisfy such condition subsequent;
NOW, THEREFORE, in consideration of the premises and in order
to induce the Lenders to make the loans to Haverty under the Credit Agreement,
the Additional Guarantor hereby agrees as follows:
1. DEFINED TERMS. Capitalized terms not otherwise defined herein which are used
in the Subsidiary Guaranty are used herein with the meanings specified for such
terms in the Credit Agreement.
-1-
150
2. ADDITIONAL GUARANTOR. The Additional Guarantor agrees that it shall be and
become a Guarantor for all purposes of the Subsidiary Guaranty and shall be
fully liable thereunder to the Agent and other Guaranteed Parties to the same
extent and with the same effect as though the Additional Guarantor had been one
of the Guarantors originally executing and delivering the Subsidiary Guaranty.
Without limiting the foregoing, the Additional Guarantor hereby jointly and
severally (with respect to the guaranties made by the Subsidiary Guarantors
under the Subsidiary Guaranty), irrevocably and unconditionally, guarantees the
punctual payment when due, whether at stated maturity by acceleration of
otherwise, of the Borrowings and all other Obligations (as defined in the Credit
Agreement, and including all renewals, extensions, modifications and
refinancings thereof, now or hereafter existing, whether for principal,
interest, fees, expenses or otherwise, and any and all expenses (including
reasonable attorneys' fees actually incurred and reasonable out-of-pocket
expenses) incurred by the Agent and other Guaranteed Parties in enforcing any
rights under the Subsidiary Guaranty (as supplemented hereby), subject, however,
to the limitations expressly provided in the Subsidiary Guaranty in Section 15
thereof. All references in the Subsidiary Guaranty to "Guarantors" or any
"Guarantor" shall be deemed to include and to refer to the Additional Guarantor.
3. GOVERNING LAW; APPOINTMENT OF AGENT FOR SERVICE OF PROCESS; SUBMISSION
TO JURISDICTION; WAIVER OF JURY TRIAL.
(a) THIS SUPPLEMENT TO GUARANTY AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAWS OF THE STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE
CONFLICT OF LAW PRINCIPLES THEREOF).
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
SUPPLEMENT TO GUARANTY AGREEMENT RELATED HERETO MAY BE BROUGHT IN THE SUPERIOR
COURT OF XXXXXX COUNTY OF THE STATE OF GEORGIA OR OF THE UNITED STATES OF
AMERICA FOR THE NORTHERN DISTRICT OF GEORGIA, AND, BY EXECUTION AND DELIVERY OF
THIS SUPPLEMENT TO GUARANTY AGREEMENT, THE ADDITIONAL GUARANTOR HEREBY CONSENTS,
FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE JURISDICTION OF THE AFORESAID
COURTS SOLELY FOR THE PURPOSE OF ADJUDICATING ITS RIGHTS OR THE RIGHTS OF THE
AGENT OR OTHER GUARANTEED PARTIES WITH RESPECT TO THIS SUPPLEMENT TO GUARANTY
AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE ADDITIONAL GUARANTOR HEREBY
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT LIMITATION, ANY OBJECTION
TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH
RESPECTIVE JURISDICTIONS IN RESPECT OF THIS SUPPLEMENT TO GUARANTY AGREEMENT OR
ANY DOCUMENT RELATED THERETO. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY
GUARANTEED
-2-
151
PARTY TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE ADDITIONAL
GUARANTOR IN ANY OTHER JURISDICTION.
(c) TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE ADDITIONAL
GUARANTOR HEREBY IRREVOCABLY WAIVES ALL RIGHT OF TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR IN CONNECTION WITH THIS SUPPLEMENT
TO GUARANTY AGREEMENT OR ANY OTHER CREDIT DOCUMENT OR ANY MATTER ARISING IN
CONNECTION HEREUNDER OR THEREUNDER.
(d) Nothing herein shall affect the right of the Guaranteed
Parties or any holder of a Note to commence legal proceedings or otherwise
proceed against the Additional Guarantor in any other jurisdiction.
-3-
152
IN WITNESS WHEREOF, the Additional Guarantor has caused this
Supplement to Guaranty to be duly executed and delivered under seal by its duly
authorized officers as of the date first above written.
Address for Notices: ADDITIONAL GUARANTOR:
------------------------------------------
By:
---------------------------------------
Title:
---------------------------------
Attest:
-----------------------------------
Title:
-----------------------------
[CORPORATE SEAL]
153
EXHIBIT L
FORM OF COMPLIANCE CERTIFICATE
SunTrust Bank, Atlanta, as Agent,
First Union National Bank and
NationsBank, N.A., as Co-Agents,
and each of the Lenders party
to the Credit Agreement referenced
below
Re: Xxxxxxx Furniture Companies, Inc.
Gentlemen:
The undersigned, ______________________, being the chief financial
officer or principal accounting officer of Xxxxxxx Furniture Companies, Inc., a
Maryland corporation (the "Borrower"), hereby delivers this Compliance
Certificate to the Agent, the Co-Agents and the Lenders as required by the terms
of that certain Credit Agreement dated as of March 31, 1998 by and among
SunTrust Bank, Atlanta, individually and as Agent, First Union National Bank and
NationsBank, N.A., individually and as Co-Agents, the Borrower and the Lenders
party thereto (the "Credit Agreement"). All terms used herein without definition
shall have the meaning set forth in the Credit Agreement.
1. The undersigned is duly authorized to execute and deliver this
certificate on behalf of the Borrower.
2. The calculations set forth in Attachment 1 hereto are true and
accurate computations of the financial covenants and the other provisions
identified on such Attachment in accordance with the terms of the Credit
Agreement.
3. The consolidated financial statements of the Borrower and its
Subsidiaries attached hereto for the fiscal [quarter][year] ending
____________________ fairly present in all material respects the financial
position of the Borrower and its Subsidiaries as at the end of such fiscal
[quarter][year] on a consolidated basis, and the results of operations and
statements of cash flows of the Borrower and its Subsidiaries for such fiscal
quarter and such portion of Borrower's fiscal year, in accordance with generally
accepted accounting principles consistently applied [(subject, in the case of
such quarterly financial statements, to normal year-end audit adjustments and
the absence of footnotes).]
154
4. Based upon a review of the activities of Consolidated Companies and
the financial statements attached hereto during the period covered thereby,
there exists no Event of Default or Default under the Credit Agreement.
----------------------------------
Name:
Title:
155
Attachment No. 1 to Compliance Certificate
The Compliance Certificate attached hereto is as of ____________ and
pertains to the period from ____________ to ____________.
[To be provided in the customary format.]
156
CREDIT AGREEMENT
dated as of March 31, 1998
among
HAVERTYS CREDIT SERVICES, INC.,
THE LENDERS LISTED HEREIN,
and
SUNTRUST BANK, ATLANTA
as Agent
and
First Union National Bank
and
NationsBank, N.A.
as Co-Agents
157
TABLE OF CONTENTS
Page
----
ARTICLE I.
DEFINITIONS; CONSTRUCTION......................................................... 1
Section 1.01. Definitions........................................................ 1
Section 1.02. Accounting Terms and Determination.................................15
Section 1.03. Other Definitional Terms...........................................15
Section 1.04. Exhibits and Schedules.............................................15
ARTICLE II.
SYNDICATED LOANS, BID RATE LOANS, SWING LINE LOANS
AND LETTERS OF CREDIT.............................................................16
Section 2.01. Commitments; Use of Proceeds.......................................16
Section 2.02. Notes; Repayment of Principal......................................16
Section 2.03. Voluntary Reduction of Commitments.................................17
Section 2.04. Letter of Credit Facility..........................................17
Section 2.05. Notice of Issuance of Letter of Credit; Agreement to Issue.........17
Section 2.06. Payment of Amounts Drawn Under Letters of Credit...................18
Section 2.07. Payment by Lenders.................................................19
Section 2.08. Swing Line Loans...................................................19
Section 2.09. Bid Rate Loans.....................................................21
ARTICLE III.
GENERAL LOAN AND LETTER OF CREDIT TERMS...........................................23
Section 3.01. Funding Notices....................................................23
Section 3.02. Disbursement of Funds..............................................25
Section 3.03. Interest...........................................................26
Section 3.04. Interest Periods...................................................27
Section 3.05. Fees...............................................................28
Section 3.06. Voluntary Prepayments of Borrowings................................28
Section 3.07. Payments, Etc......................................................29
Section 3.08. Interest Rate Not Ascertainable, Etc...............................31
Section 3.09. Illegality.........................................................31
Section 3.10. Increased Costs....................................................32
Section 3.11. Lending Offices....................................................34
Section 3.12. Funding Losses.....................................................34
i
158
Section 3.13. Assumptions Concerning Funding of Eurodollar Advances..............35
Section 3.14. Apportionment of Payments..........................................35
Section 3.15. Sharing of Payments, Etc...........................................35
Section 3.16. Letter of Credit Obligations Absolute..............................36
ARTICLE IV.
CONDITIONS TO BORROWINGS..........................................................37
Section 4.01. Conditions Precedent to Initial Loans and Letters of Credit........37
Section 4.02. Conditions to All Loans and Letters of Credit......................38
ARTICLE V.
REPRESENTATIONS AND WARRANTIES....................................................39
Section 5.01. Corporate Existence; Compliance with Law...........................39
Section 5.02. Corporate Power; Authorization.....................................40
Section 5.03. Enforceable Obligations............................................40
Section 5.04. No Legal Bar.......................................................40
Section 5.05. No Material Litigation or Investigations...........................40
Section 5.06. Investment Company Act, Etc........................................40
Section 5.07. Margin Regulations.................................................41
Section 5.08. Compliance With Environmental Laws.................................41
Section 5.09. Insurance..........................................................41
Section 5.10. No Default.........................................................42
Section 5.11. Taxes..............................................................42
Section 5.12. Subsidiaries.......................................................42
Section 5.13. Intentionally Omitted..............................................42
Section 5.14. ERISA..............................................................42
Section 5.15. Patents, Trademarks, Licenses, Etc.................................43
Section 5.16. Ownership of Property..............................................44
Section 5.17. Financial Condition................................................44
Section 5.18. Labor Matters......................................................44
Section 5.19. Payment or Dividend Restrictions...................................44
Section 5.20. Disclosure.........................................................44
ARTICLE VI.
AFFIRMATIVE COVENANTS.............................................................45
Section 6.01. Corporate Existence; Maintenance of Properties.....................45
Section 6.02. Compliance with Laws, Etc..........................................45
Section 6.03. Taxes and Claims...................................................45
Section 6.04. Compliance with Other Agreements...................................46
Section 6.05. Inspection of Property.............................................46
ii
159
Section 6.06. Insurance..........................................................46
Section 6.07. Business...........................................................46
Section 6.08. Keeping of Books...................................................46
Section 6.09. Reporting Covenants................................................46
Section 6.10. Covenant to Secure Notes Equally...................................48
ARTICLE VII.
NEGATIVE COVENANTS................................................................48
Section 7.01. ....................................................................48
ARTICLE VIII.
EVENTS OF DEFAULT.................................................................49
Section 8.01. Payments...........................................................49
Section 8.02. Covenants Without Notice...........................................49
Section 8.03. Other Covenants....................................................49
Section 8.04. Representations....................................................49
Section 8.05. Non-Payments of Other Debt.........................................50
Section 8.06. Defaults Under Other Agreements....................................50
Section 8.07. Bankruptcy.........................................................50
Section 8.08. ERISA..............................................................51
Section 8.09. Money Judgment.....................................................51
Section 8.10. Ownership of Borrower..............................................51
Section 8.11. Default Under Other Credit Documents or Parent Credit Agreement....51
Section 8.12. Attachments........................................................52
ARTICLE IX.
THE AGENT AND CO-AGENTS...........................................................52
Section 9.01. Appointment of Agent...............................................52
Section 9.02. Authorization of Agent with Respect to the Security Documents......53
Section 9.03. Nature of Duties of Agent..........................................53
Section 9.04. Lack of Reliance on the Agent......................................54
Section 9.05. Certain Rights of the Agent........................................54
Section 9.06. Reliance by Agent..................................................54
Section 9.07. Indemnification of Agent...........................................55
Section 9.08. The Agent in its Individual Capacity...............................55
Section 9.09. Holders of Notes...................................................55
Section 9.10. Successor Agent....................................................55
Section 9.11. Co-Agents..........................................................56
iii
160
ARTICLE X.
MISCELLANEOUS.....................................................................56
Section 10.01. Notices..........................................................56
Section 10.02. Amendments, Etc..................................................56
Section 10.03. No Waiver; Remedies Cumulative...................................57
Section 10.04. Payment of Expenses, Etc.........................................57
Section 10.05. Waiver of Right of Setoff........................................59
Section 10.06. Benefit of Agreement.............................................59
Section 10.07. Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.62
Section 10.08. Independent Nature of Lenders' Rights............................62
Section 10.09. Counterparts.....................................................62
Section 10.10. Effectiveness; Survival..........................................62
Section 10.11. Severability.....................................................63
Section 10.12. Independence of Covenants........................................63
Section 10.13. Change in Accounting Principles, Fiscal Year or Tax Laws.........63
Section 10.14. Headings Descriptive; Entire Agreement...........................63
SCHEDULES
---------
SCHEDULE 5.01(a) Lack of Qualification
SCHEDULE 5.01(b) Organization and Ownership of Subsidiaries
SCHEDULE 5.05 Certain Pending and Threatened Litigation
SCHEDULE 5.08 Environmental Matters
SCHEDULE 5.11 Tax Filings and Payments
SCHEDULE 5.14 Employee Benefit Matters
SCHEDULE 5.15 Patent, Trademark, License, and Other Intellectual Property Matters
SCHEDULE 5.16 Ownership of Properties
SCHEDULE 5.19 Dividend Restrictions
EXHIBITS
--------
EXHIBIT A - Form of Revolving Note
EXHIBIT B - Form of Bid Facility Note
EXHIBIT C - Form of Swing Line Note
EXHIBIT D - Bid Request
EXHIBIT E - Bid Request Invite
EXHIBIT F - Bid Rate Bid
iv
161
EXHIBIT G - Bid Rate Acceptance/Rejection
EXHIBIT H - Form of Guaranty Agreement
EXHIBIT I - Form of Closing Certificate
EXHIBIT J - Form of Opinion of Xxxxx, Xxxxxxxx & Xxxxxxx, LLP
EXHIBIT K - Form of Assignment and Acceptance Agreement
v
162
CREDIT AGREEMENT
THIS CREDIT AGREEMENT made and entered into as of March 31,
1998, by and among HAVERTYS CREDIT SERVICES, INC., a corporation organized and
existing under the laws of the State of Tennessee (the "Borrower"), SUNTRUST
BANK, ATLANTA, a banking corporation organized under the laws of the State of
Georgia ("SunTrust"), the other banks and lending institutions listed on the
signature pages hereof, and any assignees of SunTrust, or such other banks and
lending institutions which become "Lenders" as provided herein (SunTrust, and
such other banks, lending institutions, and assignees referred to collectively
herein as the "Lenders"), SUNTRUST BANK, ATLANTA, in its capacity as agent for
the Lenders and each successor agent for such Lenders as may be appointed from
time to time pursuant to Article IX hereof (the "Agent"), FIRST UNION NATIONAL
BANK and NATIONSBANK, N.A., in their respective capacities as co-agents for the
Lenders (the "Co-Agents");
W I T N E S S E T H:
WHEREAS, Borrower has requested that the Lenders provide certain
commitments to Borrower to extend credit facilities to Borrower in the maximum
aggregate principal amount of $50,000,000;
WHEREAS, the Lenders, the Agent, and the Co-Agents have agreed to
provide such facilities, subject to the terms, conditions and requirements set
forth in this Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, Borrower, the Lenders, the Agent and the Co-Agents
intending to be legally bound, hereby agree as follows:
ARTICLE I.
DEFINITIONS; CONSTRUCTION
SECTION 1.01. DEFINITIONS. In addition to the other terms
defined herein, the following terms used herein shall have the meanings herein
specified (to be equally applicable to both the singular and plural forms of the
terms defined):
"Adjusted LIBO Rate" shall mean, with respect to each Interest
Period for a Eurodollar Advance, the rate per annum (rounded upwards, if
necessary, to the nearest 1/100 of 1%) determined pursuant to the following
formula:
163
Adjusted LIBO Rate = LIBOR
----------------------
1.00 - LIBOR Reserve Percentage
As used herein, LIBOR Reserve Percentage shall mean, for any Interest Period for
a Eurodollar Advance, the reserve percentage (expressed as a decimal) equal to
the then stated maximum rate of all reserve requirements (including, without
limitation, any marginal, emergency, supplemental, special or other reserves)
applicable to any member bank of the Federal Reserve System in respect of
Eurocurrency liabilities as defined in Regulation D (or against any successor
category of liabilities as defined in Regulation D).
"Advance" shall mean any principal amount advanced and
remaining outstanding at any time under (i) the Syndicated Loans, which Advances
shall be made or outstanding as Base Rate Advances or Eurodollar Advances, as
the case may be, (ii) the Bid Rate Loans, which Advances shall be made or
outstanding as Bid Rate Advances, or (iii) the Swing Line Loans, which Advances
shall be made or outstanding as Swing Line Advances.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by, or under common control with, such
Person, whether through the ownership of voting securities, by contract or
otherwise. For purposes of this definition, "control" (including with
correlative meanings, the terms "controlling", "controlled by", and "under
common control with") as applied to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of that Person.
"Agent" shall mean SunTrust Bank, Atlanta, formerly known as
Trust Company Bank, a Georgia banking corporation and any successor agent
appointed pursuant to Section 9.10 hereof.
"Agreement" shall mean this Credit Agreement, as amended,
modified, restated, or supplemented from time to time.
"Applicable Facility Percentage" shall mean, through June 30,
1998, 0.125% per annum, and (y) thereafter, the rate for any day to be used to
calculate the Facility Fee payable by Borrower hereunder, expressed as a
percentage and determined from the chart set forth below based on Guarantor's
ratio of Consolidated Adjusted Debt to Consolidated Adjusted Capitalization (as
such terms are defined in, or incorporated by reference into, the Guaranty
Agreement) calculated as of the relevant determination date:
2
164
CONSOLIDATED ADJUSTED DEBT
TO CONSOLIDATED ADJUSTED APPLICABLE FACILITY
CAPITALIZATION RATIO PERCENTAGE
-------------------- -------------------
Less than 30% .075%
Greater than or Equal to
30% and Less than
40% .100%
Greater than or Equal to
40% and Less than
50% .125%
Greater than or Equal to
50% .150%
Each change in the Applicable Facility Percentage resulting from a change in the
Consolidated Adjusted Debt to Consolidated Adjusted Capitalization ratio shall
be effective from and after the date that any related change in the Applicable
Margin is effective.
"Applicable Margin" shall mean (x) with respect to all
outstanding Eurodollar Advances through June 30, 1998, 0.275% per annum, and (y)
thereafter with respect to all outstanding Eurodollar Advances for any day, the
applicable percentage determined from the chart set forth below based on
Guarantor's ratio of Consolidated Adjusted Debt to Consolidated Adjusted
Capitalization (as such terms are defined in, or incorporated by reference into,
the Guaranty Agreement), expressed as a percentage, calculated as of the
relevant determination date:
CONSOLIDATED ADJUSTED DEBT
TO CONSOLIDATED ADJUSTED APPLICABLE
CAPITALIZATION RATIO MARGIN
-------------------- ----------
Less than 30% .175%
Greater than or Equal to
30% and Less than
40% .225%
3
165
Greater than or Equal to
40% and Less than
50% .275%
Greater than or Equal to
50% .350%
The ratio of Consolidated Adjusted Debt to Consolidated Adjusted Capitalization,
and the resulting Applicable Margin shall be determined quarterly, based upon
the financial statements delivered to the Lenders pursuant to Section 6.09(a) or
Section 6.09(b) of the Parent Credit Agreement, as the case may be, as such
covenants are incorporated by reference into the Guaranty, with such Applicable
Margin to be effective with respect to calculations based upon the financial
statements delivered pursuant to Section 6.09 of the Parent Credit Agreement, as
incorporated by reference into the Guaranty, as of the first day of the second
fiscal quarter immediately following the fiscal quarter for which such financial
statements are delivered (for example, the Applicable Margin effective with
respect to all outstanding Eurodollar Advances as of the first day of the third
fiscal quarter shall be calculated based upon the financial statements delivered
for the first fiscal quarter of Guarantor).
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an Eligible Assignee in accordance with
the terms of this Agreement and substantially in the form of Exhibit K.
"Bankruptcy Code" shall mean The Bankruptcy Code of 1978, as
amended and in effect from time to time (11 U.S.C. ss. 101 et seq.).
"Base Rate" shall mean the higher of (with any change in the
Base Rate to be effective as of the date of change of either of the following
rates):
(a) the rate which the Agent publicly announces from time
to time to be its prime lending rate, as in effect from time to time, and
(b) the Federal Funds Rate, as in effect from time to
time, plus one-half of one percent (0.50%) per annum.
The Agent's prime lending rate is a reference rate and does not necessarily
represent the lowest or best rate charged to customers; the Agent may make
commercial loans or other loans at rates of interest at, above or below the
Agent's prime lending rate.
"Base Rate Advance" shall mean an Advance made or outstanding
as (i) a Syndicated Loan bearing interest based on the Base Rate, or (ii) an
Advance bearing interest at the rate agreed upon between Borrower and the
Lenders pursuant to Section 3.08, Section 3.09 or Section 3.10.
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"Bid Accept/Reject Letter" shall mean a notification made by
Borrower pursuant to Section 2.09 substantially in the form of Exhibit G.
"Bid Facility Note" shall mean a promissory note of Borrower
payable to the order of any Lender, in substantially the form of Exhibit B
hereto, evidencing the maximum aggregate principal indebtedness of Borrower to
such Lender with respect to outstanding Bid Rate Advances made by such Lender
pursuant to this Agreement, either as originally executed or as it may be from
time to time supplemented, modified, amended, renewed or extended.
"Bid Rate" shall mean, as to any Bid Rate Bid made by a Lender
pursuant to Section 2.09, the fixed rate of interest per annum offered by the
Lender making the Bid Rate Bid for the relevant Interest Period.
"Bid Rate Advance" shall mean an Advance made by a Lender to
Borrower pursuant to the bidding procedure described in Section 2.09.
"Bid Rate Bid" shall mean an offer by a Lender to make a Bid
Rate Loan pursuant to Section 2.09.
"Bid Rate Loan" shall mean a Borrowing made up of Advances by
all of those Lenders whose Bid Rate Bids have been accepted by Borrower pursuant
to the same Bid Request under the bidding procedure described in Section 2.09
for the same Interest Period and interest rate (with the understanding that two
Bid Rate Loans may be made pursuant to a single Bid Request).
"Bid Request" shall mean a request made by Borrower pursuant
to Section 2.09 substantially in the form of Exhibit D.
"Borrower" shall mean Havertys Credit Services, Inc., a
Tennessee corporation, its successors and permitted assigns.
"Borrowing" shall mean the incurrence by Borrower under any
Facility of Advances of one Type concurrently having the same Interest Period or
the continuation or conversion of an existing Borrowing or Borrowings in whole
or in part.
"Business Day" shall mean:
(a) any day which is neither a Saturday or Sunday nor a
legal holiday on which banks are required or authorized to close in Atlanta,
Georgia or New York, New York; and
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(b) relative to the making, continuing, prepaying or
repaying of any Eurodollar Advances, any day on which trading is carried on by
and between banks in deposits of Dollars in the London interbank market.
"Capitalized Lease Obligations" shall mean all rental
obligations which, under GAAP, are or will be required to be capitalized on the
books of any Person in each case taken at the amount thereof accounted for as
indebtedness (net of interest expense) in accordance with such principles.
"Closing Date" shall mean the date on or before March 31, 1998
on which the initial Loans are made or deemed to have been made hereunder and
the conditions set forth in Section 4.01 are satisfied or waived in accordance
with Section 10.02.
"Co-Agents" shall have the meaning set forth in the preamble
hereof.
"Commitment" shall mean, for any Lender at any time, the
amount of such commitment set forth opposite such Lender's name on the signature
pages hereof, as the same may be increased or decreased from time to time as a
result of any reduction thereof pursuant to Section 2.03, any assignment thereof
pursuant to Section 10.06, or any amendment thereof pursuant to Section 10.02.
"Consolidated" shall mean the consolidated financial
information of the Borrower and its Subsidiaries under GAAP.
"Consolidated Companies" shall mean, collectively, Borrower,
and all of its Subsidiaries.
"Consolidated Net Worth" shall mean, at any time, for the
Borrower and its Subsidiaries on a Consolidated basis, shareholders' equity at
such time determined in accordance with GAAP.
"Contractual Obligation" of any Person shall mean any
provision of any security issued by such Person or of any agreement, instrument
or undertaking under which such Person is obligated or by which it or any of the
property owned by it is bound.
"Credit Documents" shall mean, collectively, this Agreement,
the Notes, the Letters of Credit, the Guaranty Agreement, and all other Security
Documents, if any.
"Credit Parties" shall mean, collectively, each of Borrower,
the Guarantor, and every other Person who from time to time executes a Security
Document with respect to all or any portion of the Obligations.
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"Debt" shall mean, with respect to any Person, at any date of
determination:
(i) all indebtedness for borrowed money which such Person
has directly or indirectly created, incurred or assumed (including, without
limitation, all Capitalized Lease Obligations);
(ii) all indebtedness, whether or note for borrowed money,
secured by any Lien on any property or asset owned or held by such Person
subject thereto, whether or not the indebtedness secured thereby shall have been
assumed by such Person;
(iii) any indebtedness, whether or not for borrowed money,
with respect to which such Person has become directly or indirectly liable and
which represents or has been incurred to finance the purchase price (or a
portion thereof) of any property or services or business acquired by such
Person, whether by purchase, consolidation, merger or otherwise other than any
trade payable in the ordinary course of business that is a current liability
under GAAP;
(iv) any indebtedness of the character referred to in
clauses (i), (ii) or (iii) of this definition deemed to be extinguished under
GAAP but for which such Person remains legally liable; and
(v) any indebtedness of any other Person of the character
referred to in clauses (i), (ii), (iii) or (iv) of this definition with respect
to which the Person whose Debt is being determined has become liable by way of a
Guaranty;
all as determined in accordance with GAAP, provided, however, Debt shall not
include endorsements of negotiable instruments for collection in the ordinary
course of business nor any portion of a Receivable Financing that is not shown
on the balance sheet as a liability pursuant to GAAP.
"Default" shall mean any condition or event which, with notice
or lapse of time or both, would constitute an Event of Default.
"Dollar" and "U.S. Dollar" and the sign "$" shall mean lawful
money of the United States of America.
"Eligible Assignee" shall mean a commercial bank organized
under the laws of the United States, or any state thereof, having total assets
in excess of $1,000,000,000 or any commercial finance or asset based lending
Affiliate of any such commercial bank.
"Environmental Laws" shall mean all federal, state, local and
foreign statutes and codes or regulations, rules or ordinances issued,
promulgated, or approved thereunder, now or
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hereafter in effect (including, without limitation, those with respect to
asbestos or asbestos containing material or exposure to asbestos or asbestos
containing material), relating to pollution or protection of the environment and
relating to public health and safety, relating to (i) emissions, discharges,
releases or threatened releases of pollutants, contaminants, chemicals or
industrial toxic or hazardous constituents, substances or wastes, including
without limitation, any Hazardous Substance, petroleum including crude oil or
any fraction thereof, any petroleum product or other waste, chemicals or
substances regulated by any Environmental Law into the environment (including
without limitation, ambient air, surface water, ground water, land surface or
subsurface strata), or (ii) the manufacture, processing, distribution, use,
generation, treatment, storage, disposal, transport or handling of any Hazardous
Substance, petroleum including crude oil or any fraction thereof, any petroleum
product or other waste, chemicals or substances regulated by any Environmental
Law, and (iii) underground storage tanks and related piping, and emissions,
discharges and releases or threatened releases therefrom, such Environmental
Laws to include, without limitation (i) the Clean Air Act (42 U.S.C. ss. 7401 et
seq.), (ii) the Clean Water Act (33 U.S.C. ss. 1251 et seq.), (iii) the Resource
Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.), (iv) the Toxic
Substances Control Act (15 U.S.C. ss. 2601 et seq.), and (v) the Comprehensive
Environmental Response Compensation and Liability Act, as amended by the
Superfund Amendments and Reauthorization Act (42 U.S.C. ss. 9601 et seq.).
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended and in effect from time to time.
"ERISA Affiliate" shall mean, with respect to any Person, each
trade or business (whether or not incorporated) which is a member of a group of
which that Person is a member and which is under common control within the
meaning of the regulations promulgated under Section 414 of the Tax Code.
"Eurodollar Advance" shall mean an Advance made or outstanding
as a Syndicated Loan bearing interest based on the Adjusted LIBO Rate.
"Event of Default" shall have the meaning provided in Article
VIII.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended from time to time, and any successor statute thereto.
"Facility" or "Facilities" shall mean the Commitments, the Bid
Rate subfacility, the Swing Line subfacility or the Letter of Credit
subfacility, as the context may indicate.
"Facility Fee" shall have the meaning set forth in Section
3.05(a).
"Fair Market Value" shall mean at any time, the sale value of
property that would be realized in an arm's length sale at such time between an
informed and willing buyer, and an informed and willing seller, under no
compulsion to buy or sell, respectively.
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"Federal Funds Rate" shall mean for any period, a fluctuating
interest rate per annum equal for each day during such period to the weighted
average of the rates on overnight Federal funds transactions with member banks
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 Atlanta, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations for
such day on such transactions received by the Agent from three Federal funds
brokers of recognized standing selected by the Agent.
"GAAP" shall mean generally accepted accounting principles set
forth in the opinions and pronouncements of the Accounting Principles Board of
the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination.
"Guarantor" shall mean, Xxxxxxx Furniture Companies, Inc. a
Maryland corporation.
"Guaranty" shall mean any contractual obligation, contingent
or otherwise, of a Person with respect to any Debt or other obligation or
liability of another Person, including without limitation, any such Debt,
obligation or liability directly or indirectly guaranteed, endorsed, co-made or
discounted or sold with recourse by that Person, or in respect of which that
Person is otherwise directly or indirectly liable, including contractual
obligations (contingent or otherwise) arising through any agreement to purchase,
repurchase, or otherwise acquire such Debt, obligation or liability or any
security therefor, or any agreement to provide funds for the payment or
discharge thereof (whether in the form of loans, advances, stock purchases,
capital contributions or otherwise), or to maintain solvency, assets, level of
income, or other financial condition, or to make any payment other than for
value received. The amount of any Guaranty shall be deemed to be an amount equal
to the stated or determinable amount of the primary obligation in respect of
which guaranty is made or, if not so 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.
"Guaranty Agreement" shall mean, the Guaranty Agreement, dated
as of even date herewith, executed by the Guarantor in favor of the Lenders and
the Agent, substantially in the form of Exhibit H as the same may be amended,
restated or supplemented from time to time.
"Hazardous Substances" shall have the meaning assigned to that
term in the Comprehensive Environmental Response Compensation and Liability Act
of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986.
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"Interest Period" shall mean (i) as to any Eurodollar
Advances, the interest period selected by Borrower pursuant to Section 3.04(a)
hereof, (ii) as to any Bid Rate Advances, the interest period requested by
Borrower and agreed to by the participating Lenders pursuant to Section 3.04(b)
hereof, and (iii) as to any Swing Line Advance, the interest period agreed to by
the Borrower and the Swing Line Lender pursuant to Section 3.04(c) hereof.
"Lender" or "Lenders" shall mean SunTrust, the other banks and
lending institutions listed on the signature pages hereof, and each assignee
thereof, if any, pursuant to Section 10.06(c).
"Lending Office" shall mean for each Lender the office such
Lender may designate in writing from time to time to Borrower and the Agent with
respect to each Type of Loan.
"Letter of Credit Fee" shall have the meaning set forth in
Section 3.05(b).
"Letters of Credit" shall mean the letters of credit issued
pursuant to Article II hereof by the Agent for the account of Borrower pursuant
to the Commitments.
"Letter of Credit Obligations" shall mean, with respect to
Letters of Credit, as at any date of determination, the sum of (a) the maximum
aggregate amount which at such date of determination is available to be drawn by
the beneficiaries thereof (assuming the conditions for drawing thereunder have
been met) under all Letters of Credit then outstanding, plus (b) the aggregate
amount of all drawings under Letters of Credit honored by the Agent not
theretofore reimbursed by Borrower.
"LIBOR" shall mean, for any Interest Period, with respect to
Eurodollar Advances under the Commitments, the offered rate for deposits in
Dollars, for a period comparable to the Interest Period and in an amount
comparable to the requested Advances, appearing on Telerate Page 3750 as of
11:00 AM (London, England time) on the day that is two Business Days prior to
the first day of the Interest Period. If two or more of such rates appear on
such Telerate Page, the rate shall be the arithmetic mean of such rates. If the
foregoing rate is unavailable from Telerate for any reason, then such rate shall
be determined by the Agent from the Reuters Screen LIBO Page or, if such rate is
also unavailable on such service, then on any other interest rate reporting
service of recognized standing designated in writing by the Agent to Borrower
and the other Lenders; in any such case rounded, if necessary, to the next
higher 1/100 of 1.0%, if the rate is not such a multiple.
"Lien" shall mean any mortgage, pledge, security interest,
lien, charge, hypothecation, assignment, deposit arrangement, title retention,
preferential property right, trust or other arrangement having the practical
effect of the foregoing and shall include the interest of a vendor or lessor
under any conditional sale agreement, capitalized lease or other title retention
agreement.
"Loans" shall mean, collectively, the Syndicated Loans, the
Swing Line Loans and the Bid Rate Loans.
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"Margin Regulations" shall mean Regulation G, Regulation T,
Regulation U and Regulation X of the Board of Governors of the Federal Reserve
System, as the same may be in effect from time to time.
"Materially Adverse Effect" shall mean any materially adverse
change in (i) the business, results of operations, financial condition, assets
or prospects of the Guarantor and its Consolidated Subsidiaries, taken as a
whole, (ii) the ability of Borrower to perform its obligations under this
Agreement, or (iii) the ability of the other Credit Parties (taken as a whole)
to perform their respective obligations under the Credit Documents.
"Maturity Date" shall mean the earlier of (i) March 31, 2003,
and (ii) the date on which all amounts outstanding under this Agreement have
been declared or have automatically be come due and payable pursuant to the
provisions of Article VIII.
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"Notes" shall mean, collectively, the Revolving Credit Notes,
the Swing Line Note and the Bid Facility Notes.
"Notice of Borrowing" shall have the meaning provided in
Section 3.01(a)(i).
"Notice of Continuation/Conversion" shall have the meaning
provided in Section 3.01(b)(i).
"Officer's Certificate" shall mean a certificate signed in the
name of the Borrower by its Chairman of the Board, President, Senior Vice
President, one of its Vice Presidents or its Treasurer.
"Obligations" shall mean all amounts owing to the Agent or any
Lender pursuant to the terms of this Agreement or any other Credit Document,
including without limitation, all Loans (including all principal and interest
payments due thereunder), all Letter of Credit Obligations, fees, expenses,
indemnification and reimbursement payments, indebtedness, liabilities, and
obligations of the Credit Parties, direct or indirect, absolute or contingent,
liquidated or unliquidated, now existing or hereafter arising pursuant to this
Agreement or any other Credit Document, together with all renewals, extensions,
modifications or refinancings thereof.
"Parent Credit Agreement" shall mean that certain Credit
Agreement, dated as of even date herewith, by and among Xxxxxxx Furniture
Companies, Inc., SunTrust Bank, Atlanta, as Agent and the lenders from time to
time party thereto, either as originally executed or as hereafter from time to
time amended or modified.
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"Payment Office" shall mean the office specified as the
"Payment Office" for the Agent on the signature page of the Agent, or such other
location as to which the Agent shall have given written notice to Borrower and
the Lenders.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or
any successor thereto.
"Permitted Liens" shall mean those Liens expressly permitted
by Section 7.01 of the Parent Credit Agreement, as incorporated by reference
into the Guaranty Agreement.
"Person" shall mean any individual, limited liability company,
partnership, firm, corporation, association, joint venture, trust or other
entity, or any government or political subdivision or agency, department or
instrumentality thereof.
"Plan" shall mean any "employee benefit plan" (as defined in
Section 3(3) of ERISA), including, but not limited to, any defined benefit
pension plan, profit sharing plan, money purchase pension plan, savings or
thrift plan, stock bonus plan, employee stock ownership plan, Multiemployer
Plan, or any plan, fund, program, arrangement or practice providing for medical
(including post-retirement medical), hospitalization, accident, sickness,
disability, or life insurance benefits.
"Pro Rata Share" shall mean, with respect to Commitments, each
Syndicated Loan and all Letters of Credit to be made by and each payment
(including, without limitation, any payment of principal, interest or fees) to
be made to each Lender, the percentage designated as such Lender's Pro Rata
Share of such Commitments, set forth under the name of such Lender on the
respective signature page for such Lender, as such percentage may change based
upon amendments and assignments hereunder.
"Properties" shall mean all real property owned, leased or
otherwise used or occupied by the Borrower or any Subsidiary, wherever located.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System, as the same may be in effect from time
to time.
"Required Lenders" shall mean at any time prior to the
termination of the Commitments, Lenders holding at least 66 2/3% of the then
aggregate amount of the Commitments, or, following the termination of the
Commitments hereunder, Lenders holding at least 66 2/3% of the sum of the
aggregate outstanding Loans and Letter of Credit Obligations.
"Requirement of Law" for any person shall mean the articles or
certificate of incorporation and by-laws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation, or
determination of an arbitrator or a court or other governmental
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authority, in each case applicable to or binding upon such Person or any of its
property or to which such Person or any of its property is subject.
"Responsible Officer" shall mean the chief executive officer,
chief operating officer, principal financial officer, principal accounting
officer, treasurer or assistant treasurer of the Borrower or any other senior
executive officer of the Borrower involved principally in its financial
administration or its controllership function.
"Reuters Screen" shall mean, when used in connection with any
designated page and LIBOR, the display page so designated on the Reuters Monitor
Money Rates Service (or such other page as may replace that page on that service
for the purpose of displaying rates comparable to LIBOR).
"Revolving Credit Notes" shall mean, collectively, the
promissory notes evidencing the Syndicated Loans in the form attached hereto as
Exhibit A, either as originally executed or as hereafter amended, modified or
substituted.
"Security Documents" shall mean, collectively, the Guaranty
Agreement, and each other guaranty agreement, mortgage, deed of trust, security
agreement, pledge agreement, or other security or collateral document
guaranteeing or securing the Obligations, as the same may be amended, restated,
or supplemented from time to time.
"Solvent" shall mean, as to any Credit Party at any time, that
(i) each of the fair value and the present fair saleable value of such Person's
assets (including any rights of subrogation or contribution to which such Person
is entitled, under any of the Credit Documents or otherwise) is greater than
such Person's debts and other liabilities (including contingent, unmatured and
un liquidated debts and liabilities) and the maximum estimated amount required
to pay such debts and liabilities as such debts and liabilities mature or
otherwise become payable; (ii) such Person is able and expects to be able to pay
its debts and other liabilities (including, without limitation, contingent,
unmatured and unliquidated debts and liabilities) as they mature; and (iii) such
Person does not have unreasonably small capital to carry on its business as
conducted and as proposed to be conducted.
"Subsidiary" shall mean, with respect to any Person, any
corporation or other entity (including, without limitation, partnerships, joint
ventures, and associations) regardless of its ju risdiction of organization or
formation, at least a majority of the total combined voting power of all classes
of voting stock or other ownership interests of which shall, at the time as of
which any determination is being made, be owned by such Person, either directly
or indirectly through one or more other Subsidiaries.
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"Swing Line Advance" shall mean a Borrowing pursuant to
Section 2.08 consisting of a Swing Line Loan made by the Swing Line Lender to
Borrower on the same date and interest rate basis and for the same Interest
Period.
"Swing Line Borrowing" shall mean a Borrowing consisting or to
consist of a Swing Line Advance.
"Swing Line Borrowing Notice" shall mean the notice given by
Borrower to the Agent and the Swing Line Lender requesting a Swing Line Advance
as provided in Section 2.08(c).
"Swing Line Facility" shall mean the credit facility described
in Section 2.08.
"Swing Line Lender" shall mean SunTrust Bank, Atlanta or any
subsequent Lender extending to Borrower the Swing Line Subcommitment hereunder.
"Swing Line Loans" shall mean, collectively, the loans made to
Borrower by the Swing Line Lender pursuant to Section 2.08.
"Swing Line Note" shall mean the promissory note evidencing
the Swing Line Loans substantially in the form of Exhibit C and duly completed
in accordance with the terms hereof.
"Swing Line Subcommitment" shall mean the commitment of the
Swing Line Lender to make Swing Line Loans in an aggregate principal amount at
any time outstanding not to exceed $5,000,000.
"Syndicated Loans" shall mean, collectively, all outstanding
Loans made to Borrower by the Lenders pursuant to Section 2.01 hereof based upon
each Lender's Pro Rata Share of the Revolving Loan Commitments.
"Tax Code" shall mean the Internal Revenue Code of 1986, as
amended and in effect from time to time.
"Taxes" shall mean any present or future taxes, levies,
imposts, duties, fees, assessments, deductions, withholdings or other charges of
whatever nature, including without limitation, income, receipts, excise,
property, sales, transfer, license, payroll, withholding, social security and
franchise taxes now or hereafter imposed or levied by the United States, or any
state, local or foreign government or by any department, agency or other
political subdivision or taxing authority thereof or therein and all interest,
penalties, additions to tax and similar liabilities with respect thereto.
"Telerate" shall mean, when used in connection with any
designated page and LIBOR, the display page so designated on the Dow Xxxxx
Telerate Service (or such other page as may replace that page on that service
for the purpose of displaying rates comparable to LIBOR).
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"Third Party" shall mean all lessees, sublessees, licensees
and other users of the Properties, excluding those users of the Properties in
the ordinary course of the Borrower's business (consistent with its practices as
of the Closing Date) and on a temporary basis.
Transaction Rate" shall mean the rate of interest specified by
the Swing Line Lender to Borrower as being applicable to a Swing Line Loan
requested by Borrower pursuant to Section 2.08(c).
"Transaction Rate Quote" shall mean an offer by the Swing Line
Lender to make a Swing Line Loan to Borrower at the Transaction Rate specified
therein for the Interest Period to be applicable to the Swing Line Loan as
specified therein, pursuant to Section 2.08(c).
"Type" of Borrowing shall mean a Borrowing consisting of Base
Rate Advances, Bid Rate Advances or Eurodollar Advances.
SECTION 1.02. ACCOUNTING TERMS AND DETERMINATION. Unless
otherwise defined or specified herein, all accounting terms shall be construed
herein, all accounting determinations hereunder shall be made, all financial
statements required to be delivered hereunder shall be prepared, and all
financial records shall be maintained in accordance with, GAAP, provided,
however, that compliance with the financial covenants and calculations set forth
in Article VII and elsewhere herein, if any, and in the definitions used in such
covenants and calculations, shall be calculated, made and applied in accordance
with GAAP and such generally accepted accounting principles in such foreign
jurisdictions, as the case may be, as in effect on the date of this Agreement
unless and until Borrower and the Required Lenders enter into an agreement with
respect thereto in accordance with Section 10.13.
SECTION 1.03. OTHER DEFINITIONAL TERMS. The words "hereof",
"herein" and "hereunder" and words of similar import when used in this Agreement
shall refer to this Agreement as a whole and not to any particular provision of
this Agreement, and Article, Section, Schedule, Exhibit and like references are
to this Agreement unless otherwise specified. Any of the terms defined in
Section 1.01 may, unless the context otherwise requires, be used in the singular
or the plural depending on the reference.
SECTION 1.04. EXHIBITS AND SCHEDULES. All Exhibits and
Schedules attached hereto are by reference made a part hereof.
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ARTICLE II.
SYNDICATED LOANS, BID RATE LOANS, SWING LINE LOANS
AND LETTERS OF CREDIT
SECTION 2.01. COMMITMENTS; USE OF PROCEEDS.
(a) Subject to and upon the terms and conditions herein
set forth, each Lender severally agrees to make to Borrower from time to time on
and after the Closing Date, but prior to the Maturity Date, Syndicated Loans in
an aggregate amount outstanding at any time not to exceed such Lender's
Commitment minus such Lender's Pro Rata Share of the Letter of Credit
Obligations, subject, however, to the conditions that (i) at no time shall the
sum of the (w) the outstanding principal amount of all Syndicated Loans, plus
(x) the outstanding principal amount of all Bid Rate Loans, plus (y) the
outstanding principal amount of all Swing Line Loans, plus (z) the outstanding
Letter of Credit Obligations, exceed the sum of the Commitments, and (ii) at all
times shall the outstanding principal amount of the Syndicated Loans of each
Lender equal the product of each Lender's Pro Rata Share of the Commitments
multiplied by the aggregate outstanding amount of the Syndicated Loans. Borrower
shall be entitled to repay and reborrow Syndicated Loans in accordance with the
provisions hereof.
(b) Each Syndicated Loan shall, at the option of
Borrower, be made or continued as, or converted into, part of one or more
Borrowings that shall consist entirely of Base Rate Advances or Eurodollar
Advances. The aggregate principal amount of each Borrowing of Syndicated Loans
comprised of Base Rate Advances shall be not less than $1,000,000 or a greater
integral multiple of $100,000 and aggregate principal amount of each Borrowing
of Syndicated Loans comprised of Eurodollar Advances shall be not less than
$2,000,000 or a greater integral multiple of $100,000. At no time shall the
number of outstanding Borrowings comprised of Eurodollar Advances and Bid Rate
Advances exceed ten.
(c) The proceeds of Loans shall be used by the Borrower
solely for general corporate and working capital purposes, including the
purchase of receivables from the Guarantor.
SECTION 2.02. NOTES; REPAYMENT OF PRINCIPAL.
(a) Borrower's obligations to pay the principal of, and
interest on, the Syndicated Loans to each Lender shall be evidenced by the
records of the Agent and such Lender and by the Revolving Credit Note payable to
such Lender (or the assignor of such Lender) completed in conformity with this
Agreement, which records, absent manifest error, shall constitute prima facie
evidence of the amount owed by Borrower with respect to the Syndicated Loans.
(b) All outstanding principal amounts under the
Commitments shall be due and payable in full on the Maturity Date.
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SECTION 2.03. VOLUNTARY REDUCTION OF COMMITMENTS. Upon at
least three (3) Business Days' prior written notice to the Agent, Borrower shall
have the right, without premium or penalty, to terminate the unutilized
Commitments, in part or in whole, provided that (i) any such termination shall
apply to proportionately and permanently reduce the Commitments of each of the
Lenders, and (ii) any partial termination pursuant to this Section 2.03 shall be
in an amount of at least $5,000,000 and integral multiples of $1,000,000.
SECTION 2.04. LETTER OF CREDIT FACILITY. Subject to, and upon
the terms and conditions set forth herein, Borrower may request, in accordance
with the provisions of this Section 2.04 and Section 2.05 and the other terms of
this Agreement, that on and after the Closing Date but prior to the Maturity
Date, the Agent issue a Letter or Letters of Credit for the account of Borrower;
provided that the aggregate outstanding amount of Letter of Credit Obligations
shall not at any time exceed $1,000,000, provided further that (i) no Letter of
Credit shall have an expiration date that is later than one year after the date
of issuance thereof (provided that a Letter of Credit may provide that it is
extendible for consecutive one year periods); (ii) in no event shall any Letter
of Credit issued by the Agent have an expiration date (or be extended so that it
will expire) later than the Maturity Date; and (iii) Borrower shall not request
that the Agent issue any Letter of Credit, if, after giving effect to such
issuance, the sum of the aggregate Letter of Credit Obligations plus the
aggregate outstanding principal amount of the Syndicated Loans plus the
aggregate outstanding principal amount of the Bid Rate Loans plus the aggregate
outstanding principal amount of the Swing Line Loans would exceed the
Commitments.
SECTION 2.05. NOTICE OF ISSUANCE OF LETTER OF CREDIT;
AGREEMENT TO ISSUE.
(a) Whenever Borrower desires the issuance of a Letter of
Credit, it shall, in addition to any application and documentation procedures
required by the Agent for the issuance of such Letter of Credit, deliver to the
Agent a written notice no later than 11:00 AM (local time for the Agent) at
least three (3) Business Days' in advance of the proposed date of issuance and
the Agent shall promptly forward a copy of such notice to each of the Lenders.
Each such notice shall specify (i) the proposed date of issuance (which shall be
a Business Day); (ii) the face amount of the Letter of Credit; (iii) the
expiration date of the Letter of Credit; and (iv) the name and address of the
beneficiary with respect to such Letter of Credit and shall attach a precise
description of the documentation and a verbatim text of any certificate to be
presented by the beneficiary of such Letter of Credit which would require the
Agent to make payment under the Letter of Credit, provided that the Agent may
require changes in any such documents and certificates in accordance with its
customary letter of credit practices, and provided further, that no Letter of
Credit shall require payment against a conforming draft to be made thereunder on
the same Business Day that such draft is presented if such presentation is made
after 11:00 AM (Atlanta, Georgia time). In determining whether to pay any draft
under any Letter of Credit, the Agent shall be responsible only to determine
that the documents and certificate required to be delivered under its Letter of
Credit have been delivered, and that they comply on their face with the
requirements of the Letter of Credit. Promptly
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after receiving the notice of issuance of a Letter of Credit, the Agent shall
notify each Lender of such Lender's respective participation therein, determined
in accordance with its respective Pro Rata Share.
(b) The Agent agrees, subject to the terms and conditions
set forth in this Agreement, to issue for the account of Borrower a Letter of
Credit in a face amount equal to the face amount requested under paragraph (a)
above, following its receipt of a notice required by Section 2.05(a).
Immediately upon the issuance of each Letter of Credit, each Lender shall be
deemed to, and hereby agrees to, have irrevocably purchased from the Agent a
participation in such Letter of Credit and any drawing thereunder in an amount
equal to such Lender's Pro Rata Share multiplied by the face amount of such
Letter of Credit. Upon issuance and amendment or extension of any Letter of
Credit, the Agent shall provide a copy of each such Letter of Credit issued,
amended or extended hereunder to each of the Lenders.
SECTION 2.06. PAYMENT OF AMOUNTS DRAWN UNDER LETTERS OF
CREDIT.
(a) In the event of any request for a drawing under any
Letter of Credit by the beneficiary thereof, the Agent shall notify Borrower and
the Lenders on or before the date on which the Agent intends to honor such
drawing, and Borrower shall reimburse the Agent on the day on which such drawing
is honored in an amount, in same day funds, equal to the amount of such drawing.
(b) Notwithstanding any provision of this Agreement to
the contrary, to the extent that any Letter of Credit or portion thereof remains
outstanding on the Maturity Date, for any reason whatsoever, the parties hereto
hereby agree that the beneficiary or beneficiaries thereof shall be deemed to
have made a drawing of all available amounts pursuant to such Letters of Credit
on the Maturity Date which amount shall be held by the Agent as cash collateral
for its remaining obligations pursuant to such Letters of Credit.
(c) As between Borrower and the Agent, Borrower assumes
all risk of the acts and omissions of, or misuse of, the Letters of Credit
issued by the Agent, by the respective beneficiaries of such Letters of Credit,
other than losses resulting from the gross negligence and willful misconduct of
the Agent. In furtherance and not in limitation of the foregoing but subject to
the exception for the Agent's gross negligence or willful misconduct set forth
above, the Agent shall not be responsible (i) for the form, validity,
sufficiency, accuracy, genuineness or legal effect of any document submitted by
any party in connection with the application for and issuance of such Letters of
Credit, even if it should in fact prove to be in any or all respects
insufficient, inaccurate, fraudulent or forged or otherwise invalid; (ii) for
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any such Letter of Credit or the rights or
benefits thereunder or proceeds thereof in whole or in part which may prove to
be invalid or ineffective for any reason; (iii) for failure of the beneficiary
of any such Letter of Credit to comply fully with the conditions required in
order to draw upon such Letter of Credit (without relieving the Agent of its
duties pursuant to the penultimate sentence of Section 2.05(a)); (iv) for
errors,
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omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex, telecopy or otherwise; (v) for good faith
errors in interpretation of technical terms; (vi) for any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any such Letter of Credit or the proceeds thereof; (vii) for the
misapplication by the beneficiary of any such Letter of Credit; and (viii) for
any consequences arising from causes beyond the control of the Agent.
SECTION 2.07. PAYMENT BY LENDERS. In the event that Borrower
shall fail to reimburse the Agent as provided in Section 2.06, the Agent shall
promptly notify each Lender of the unreimbursed amount of such drawing and of
such Lender's respective participation therein. Each Lender shall make available
to the Agent an amount equal to its respective participation, in Dollars and in
immediately available funds, at the office of the Agent specified in such notice
not later than 1:00 P.M. (Atlanta, Georgia time) on the Business Day after the
date notified by the Agent and such amount shall be deemed to be outstanding
hereunder as a Base Rate Loan. Each Lender shall be obligated to make such Base
Rate Loan hereunder regardless of whether the conditions precedent in Article IV
are satisfied and regardless of whether such Base Rate Loan complies with the
minimum borrowing requirements hereunder. In the event that any such Lender
fails to make available to the Agent the amount of such Lender's participation
in such Letter of Credit, the Agent shall be entitled to recover such amount on
demand from such Lender together with interest as provided for in Section 3.02.
The Agent shall distribute to each Lender which has paid all amounts payable
under this Section with respect to any Letter of Credit, such Lender's Pro Rata
Share of all payments received by the Agent from Borrower in reimbursement of
drawings honored by the Agent under such Letter of Credit when such payments are
received.
SECTION 2.08. SWING LINE LOANS.
(a) Subject to and upon the terms and conditions herein
set forth (including the limitation set forth in Section 2.01), the Swing Line
Lender agrees to make to Borrower, from time to time prior to the Maturity Date,
Swing Line Loans in an aggregate principal amount outstanding at any time not to
exceed the Swing Line Subcommitment. Borrower shall be entitled to borrow, repay
and reborrow Swing Line Loans in accordance with the provisions, and subject to
the limitations, set forth herein (including the limitation set forth in Section
2.01).
(b) Each Swing Line Loan shall bear interest based on the
Transaction Rate. The aggregate principal amount of each Swing Line Borrowing
shall be not less than $250,000 or a greater integral multiple of $1,000. At no
time shall the number of Swing Line Borrowings outstanding under this Section
2.08 exceed three.
(c) Whenever Borrower desires to make a Swing Line
Borrowing, it shall give the Swing Line Lender (with a copy to the Agent) prior
written notice (or telephonic notice promptly confirmed in writing) of such
Swing Line Borrowing (each a "Swing Line Borrowing
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Notice") prior to 12:00 Noon. (local time for the Swing Line Lender) on the date
of such Swing Line Borrowing. Each Swing Line Borrowing Notice shall specify the
aggregate principal amount of the Swing Line Borrowing, the date of such Swing
Line Borrowing (which shall be a Business Day) and the Interest Period requested
to be applicable thereto. Prior to 1:30 p.m. (local time for the Swing Line
Lender) on such date, the Swing Line Lender shall furnish Borrower (with a copy
to the Agent) with a quotation of the interest rate being offered with respect
to such Swing Line Borrowing (whether expressed as a fixed rate of interest in
effect for the Interest Period applicable thereto or as a floating rate of
interest based on a specified interest rate index and applicable margin for the
Interest Period to be applicable thereto; in either case, a "Transaction Rate
Quote") by telephone (promptly confirmed in writing) or by facsimile
transmission. Borrower shall immediately inform the Swing Line Lender (with a
copy to the Agent) of its decision as to whether to accept the Transaction Rate
Quote and to confirm the Swing Line Borrowing (which may be done by telephone,
promptly confirmed in writing, and which decision shall be irrevocable). If
Borrower has so informed the Swing Line Lender and confirmed the terms of the
Swing Line Borrowing, then no later than 3:00 p.m. (local time for the Swing
Line Lender) on such date, the Swing Line Lender shall make the principal amount
of the Swing Line Loan available to the Agent in immediately available funds at
the Payment Office of the Agent, and the Agent will make available to Borrower
such amount by crediting such amount to Borrower's demand deposit account
maintained with the Agent. In the event that the Swing Line Lender does not make
such amount available to the Agent at the time prescribed above, but such amount
is received later that day, such amount may be credited to Borrower in the
manner described in the preceding sentence on the next Business Day (with
interest on such amount to begin accruing hereunder on such next Business Day).
(d) Borrower's obligations to pay the principal of, and
interest on, the Swing Line Loans shall be evidenced by the records of the Agent
and the Swing Line Lender and by the Swing Line Note payable to the Swing Line
Lender (or the assignor of such Swing Line Lender) completed in conformity with
this Agreement, and such records, absent manifest error, shall constitute prima
facie evidence of the amount owed by Borrower with respect to the Swing Line
Loans.
(e) The outstanding principal amount under each Swing
Line Loan shall be due and payable in full (i) on the expiration of the Interest
Period applicable to such Swing Line Loan, and (ii) on the Maturity Date.
(f) At any time on the request of the Swing Line Lender,
each Lender other than the Swing Line Lender shall purchase a participating
interest in all outstanding Swing Line Loans in an amount equal to its Pro Rata
Share of such Swing Line Loans, and the Swing Line Lender shall furnish each
Lender with a certificate evidencing such participating interest. Such purchase
shall be made on the third Business Day after such request is made; provided,
however, that unless an Event of Default has occurred and is continuing on the
date such request is made, the purchase of a participating interest in any Swing
Line Loan shall not be required to be made until the expiration of the current
Interest Period in effect for such Swing Line Loan. On the date of such required
purchase, each Lender will immediately transfer to the Swing Line Lender, in
immediately available funds, the amount of its participation. Whenever, at any
time after the Swing Line Lender has
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received from any such Lender the funds for its participating interest in a
Swing Line Loan, the Agent or the Swing Line Lender receives any payment on
account thereof, the Agent or the Swing Line Lender will distribute to such
Lender its participating interest in such amount (appropriately adjusted, in the
case of interest payments, to reflect the period of time during which such
Lender's participating interest was outstanding and funded); provided, however,
that if such payment received by the Agent or the Swing Line Lender is required
to be returned, such Lender will return to the Agent or the Swing Line Lender
any portion thereof previously distributed by the Agent or the Swing Line Lender
to it. Each Lender's obligation to purchase such participating interests shall
be absolute and unconditional and shall not be affected by any circumstance,
including without limitation (i) any setoff, counterclaim, recoupment, defense
or other right that such Lender or any other Person may have against the Lender
requesting such purchase or any other Person for any reason whatsoever, (ii) the
occurrence or continuation of a Default or an Event of Default or the
termination of any of the Commitments, (iii) any adverse change in the condition
(financial or otherwise) of Borrower, Guarantor, any of their respective
Consolidated Subsidiaries, or any other Person, (iv) any breach of this
Agreement by Borrower or any other Lender, or (v) any other circumstance,
happening or event whatsoever, whether or not similar to any of the foregoing;
provided, however, that no such obligation shall exist (A) to the extent that
the aggregate Swing Line Loans were advanced in excess of the Swing Line
Subcommitment then in effect, or (B) with respect to any Swing Line Loan where
the Swing Line Lender actually advanced to Borrower net proceeds from the Swing
Line Loan (and therefore was not refunding a previous Swing Line Loan) at a time
when (x) the Swing Line Lender had actual knowledge that an Event of Default had
occurred and then existed, and (y) the Required Lenders had not agreed to waive
such Event of Default for purposes of funding such Swing Line Loan.
SECTION 2.09. BID RATE LOANS. Subject to the terms and
conditions hereof, Borrower may request, and each Lender, in its sole
discretion, may agree to make Bid Rate Advances in accordance with the following
procedure; provided, that, at no time shall the sum of the outstanding principal
amount of the Loans plus the Letter of Credit Obligations exceed the sum of
Commitments:
(a) In order to request Bid Rate Bids, Borrower shall
telecopy to the Agent a duly completed Bid Request in the form of Exhibit D
attached hereto (which may request not more than two Bid Rate Bids), to be
received by the Agent not later than 11:00 a.m. (local time for the Agent) on
the Business Day of the proposed Bid Rate Loan or Loans; provided that, such Bid
Request shall not be deemed to have been received by the Agent in a timely
manner unless Borrower shall also have notified the Agent by telephone
(excluding voice mail notification) of such Bid Request by the time specified
above. A Bid Request that does not conform substantially to the format of
Exhibit D may be rejected in the Agent's sole discretion, and the Agent shall
notify Borrower of such rejection by telecopy not later than 12:00 noon
(Atlanta, Georgia time) on the date of receipt. Such request shall in each case
refer to this Agreement and specify (i) the date of such Borrowing or Borrowings
(which shall be a Business Day) and (ii) the aggregate principal amount thereof
which shall be in
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a minimum principal amount of $2,000,000 and in integral multiples of $100,000,
and (iii) the Interest Period with respect thereto. Promptly after its receipt
of a Bid Request that is not rejected as aforesaid, the Agent shall invite by
telecopy (substantially in the form set forth in Exhibit E attached hereto) the
Lenders to bid, on the terms and conditions of this Agreement, to make Bid Rate
Advances pursuant to the Bid Request.
(b) Each Lender may, in its sole discretion, make one or
more Bid Rate Bids (but not more than two) to Borrower responsive to a Bid
Request. Each Bid Rate Bid by a Lender must be received by the Agent via
telecopy, substantially in the form of Exhibit F attached hereto, not later than
12:00 noon (local time for the Agent) on the Business Day of the proposed Bid
Rate Loan. Multiple bids (not to exceed two per Lender) will be accepted by the
Agent. Bid Rate Bids that do not conform substantially to the format of Exhibit
F may be rejected by the Agent acting in consultation with Borrower, and the
Agent shall notify the Lender making such nonconforming bid of such rejection as
soon as practicable. Each Bid Rate Bid shall refer to this Agreement and specify
(i) the principal amount (which may equal the entire principal amount of the Bid
Rate Loan requested by Borrower) of the Bid Rate Advance or Advances that the
Lender is willing to make to Borrower, (ii) the Bid Rate or Rates at which the
Lender is prepared to make the Bid Rate Advance or Advances, and (iii) the
Interest Period and the last day thereof. A Bid Rate Bid submitted by a Lender
pursuant to this paragraph (b) shall be irrevocable (absent manifest error).
(c) The Agent shall promptly notify Borrower by telecopy
of all the Bid Rate Bids made, the Bid Rate and the principal amount of each Bid
Rate Advance in respect of which a Bid Rate Bid was made and the identity of the
Lender that made each bid. The Agent shall send a copy of all Bid Rate Bids to
Borrower for its records as soon as practicable after completion of the bidding
process set forth in this Section 2.09.
(d) Borrower may, in its sole and absolute discretion,
subject only to the provisions of this paragraph (d), accept or reject any Bid
Rate Bid referred to in paragraph (c) above. Borrower shall notify the Agent by
telephone, confirmed by telecopy in the form of a Bid Accept/Reject Letter,
whether and to what extent it has decided to accept or reject any of or all the
bids referred to in paragraph (c) above not later than 12:30 p.m. (local time
for the Agent) on the Business Day of the proposed Bid Loan; provided, however,
that (i) the failure by Borrower to give such notice shall be deemed to be a
rejection of all the bids referred to in paragraph (c) above, (ii) Borrower
shall not accept a bid for a specific Interest Period made at a particular Bid
Rate if Borrower has decided to reject a bid for the same Interest Period made
at a lower Bid Rate, (iii) the aggregate amount of the Bid Rate Bids accepted by
Borrower shall not exceed the principal amount specified in the Bid Request,
(iv) if Borrower shall accept a bid or bids made at a particular Bid Rate but
the amount of such bid or bids shall cause the total amount of bids to be
accepted by Borrower to exceed the amount specified in the Bid Request, then
Borrower shall accept a portion of such bid or bids in an amount equal to the
amount specified in the Bid Request less the amount of all other Bid Rate Bids
accepted with respect to such Bid Request, which acceptance, in the case of
multiple bids at the same Bid Rate, shall be made pro rata in accordance with
the amount of each such bid at such Bid Rate, and (v) except pursuant to clause
(iv) above, no bid shall be accepted for a Bid
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Rate Loan unless such Bid Rate Loan is in a minimum principal amount of
$2,000,000 and an integral multiple of $100,000; provided further, however, that
if a Bid Loan must be in an amount less than $2,000,000 because of the
provisions of clause (iv) above, such Bid Loan may be for a minimum of $500,000
and an integral multiple of $100,000, and in calculating the pro rata allocation
of acceptances of portions of multiple bids at a particular Bid Rate pursuant to
clause (iv) the amounts shall be rounded to integral multiples of $100,000 in a
manner which shall be in the discretion of Borrower. A notice given by Borrower
pursuant to this paragraph (d) shall be irrevocable.
(e) The Agent shall promptly notify each bidding Lender
whether or not its Bid Rate Bid has been accepted (and if so, in what amount and
at what Bid Rate) and shall notify each Lender as to the amount, Interest Period
and Bid Rate of each Bid Rate Bid accepted by Borrower by telecopy sent by the
Agent, and each successful bidder will thereupon become bound, subject to the
other applicable conditions hereof, to make the Bid Rate Loan in respect of
which its bid has been accepted.
(f) Borrower shall not submit a Bid Request more than
four times in any seven day period.
(g) If the Agent shall elect to submit a Bid Rate Bid in
its capacity as a Lender, it shall submit such bid directly to Borrower one half
of an hour earlier than the earliest time at which the other Lenders are
required to submit their bids to the Agent pursuant to paragraph (b) above.
(h) Each Lender participating in any Bid Rate Loan shall
make its Bid Rate Advance available to the Agent on the date specified in the
Bid Request at the time and in the manner and subject to the provisions
specified in Section 3.02.
(i) The Bid Rate Advances of each Lender shall be
evidenced by its Bid Facility Note and shall be due and payable in full on the
earlier to occur of (x) the last day of the relevant Interest Period or (y) the
Maturity Date, unless sooner accelerated pursuant to Article VIII hereof.
ARTICLE III.
GENERAL LOAN AND LETTER OF CREDIT TERMS
SECTION 3.01. FUNDING NOTICES.
(a) (i) Whenever Borrower desires to obtain a
Syndicated Loan with respect to the Commitments (other than one resulting from a
conversion or continuation pursuant to
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Section 3.01(b)(i)), it shall give the Agent prior written notice (or telephonic
notice promptly confirmed in writing) of such Borrowing (a "Notice of
Borrowing"), such Notice of Borrowing to be given prior to 11:00 AM (local time
for the Agent) at its Payment Office (x) three Business Days prior to the
requested date of such Borrowing in the case of Eurodollar Advances and Bid Rate
Advances, and (y) on the date of such Borrowing (which shall be a Business Day)
in the case of a Borrowing consisting of Base Rate Advances. Notices received
after 11:00 AM shall be deemed received on the next Business Day. Each Notice of
Borrowing shall be irrevocable and shall specify the aggregate principal amount
of the Borrowing, the date of Borrowing (which shall be a Business Day), and
whether the Borrowing is to consist of Base Rate Advances or Eurodollar Advances
and (in the case of Eurodollar Advances) the Interest Period to be applicable
thereto.
(ii) Whenever Borrower desires to obtain a Swing
Line Loan, it shall notify the Swing Line Lender, with a copy to the Agent, in
accordance with the procedure set forth in Section 2.08 hereof.
(iii) Whenever Borrower desires to obtain a Bid
Rate Loan, it shall notify the Agent in accordance with the procedure set forth
in Section 2.09 hereof.
(b) (i) Whenever Borrower desires to convert all or
a portion of an outstanding Borrowing under the Commitments, which Borrowing
consists of Base Rate Advances or Eurodollar Advances, into one or more
Borrowings consisting of Advances of another Type, or to continue outstanding a
Borrowing consisting of Eurodollar Advances for a new Interest Period, it shall
give the Agent at least three Business Days' prior written notice (or telephonic
notice promptly confirmed in writing) of each such Borrowing to be converted
into or continued as Eurodollar Advances. Such notice (a "Notice of
Conversion/Continuation") shall be given prior to 11:00 AM (local time for the
Agent) on the date specified at the Payment Office of the Agent. Each such
Notice of Conversion/Continuation shall be irrevocable and shall specify the
aggregate principal amount of the Advances to be converted or continued, the
date of such conversion or continuation, whether the Advances are being
converted into or continued Eurodollar Advances and, if so, the Interest Period
applicable thereto. If, upon the expiration of any Interest Period in respect of
any Borrowing, Borrower shall have failed to deliver the Notice of
Conversion/Continuation, Borrower shall be deemed to have elected to convert or
continue such Borrowing to a Borrowing consisting of Base Rate Advances. So long
as any Default or Event of Default shall have occurred and be continuing, no
Borrowing may be converted into or continued as (upon expiration of the current
Interest Period) Eurodollar Advances unless the Agent and each of the Lenders
shall have otherwise consented in writing. No conversion of any Borrowing of
Eurodollar Advances shall be permitted except on the last day of the Interest
Period in respect thereof.
(ii) Upon the expiration of the applicable
Interest Period with respect to Swing Line Loans, Borrower shall repay such Loan
in full in accordance with the terms hereof.
(iii) Upon the expiration of the applicable
Interest Period with respect to Bid Rate Loans, Borrower shall repay such Loan
in full in accordance with the terms hereof.
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(c) Without in any way limiting Borrower's obligation to
confirm in writing any telephonic notice, the Agent and the Swing Line Lender
may act without liability upon the basis of telephonic notice believed by the
Agent or the Swing Line Lender in good faith to be from Borrower prior to
receipt of written confirmation. In each such case, Borrower hereby waives the
right to dispute the Agent's or the Swing Line Lender's record of the terms of
such telephonic notice.
(d) The Agent shall promptly give each Lender notice by
telephone (confirmed in writing) or by telecopy or facsimile transmission of the
matters covered by the notices given to the Agent pursuant to this Section 3.01
with respect to the Commitments.
SECTION 3.02. DISBURSEMENT OF FUNDS.
(a) No later than 1:00 PM (local time for the Agent) on
the date of each Syndicated Loan pursuant to the Commitments (other than one
resulting from a conversion or continuation pursuant to Section 3.01(b)(i)),
each Lender will make available its Pro Rata Share of such Syndicated Loan in
immediately available funds at the Payment Office of the Agent. The Agent will
make available to Borrower the aggregate of the amounts (if any) so made
available by the Lenders to the Agent in a timely manner by crediting such
amounts to Borrower's demand deposit account maintained with the Agent or at
Borrower's option, effecting a wire transfer of such amounts to an account
specified by Borrower, by the close of business on such Business Day. In the
event that the Lenders do not make such amounts available to the Agent by the
time prescribed above, but such amount is received later that day, such amount
may be credited to Borrower in the manner described in the preceding sentence on
the next Business Day (with interest on such amount to begin accruing hereunder
on such next Business Day).
(b) No later than 1:00 P.M. (local time for the Agent) on
the date of each Bid Rate Loan, the Lenders participating in such Bid Rate Loan
will make available the amount of its Bid Rate Advance in immediately available
funds at the Payment Office of the Agent on the date of such Bid Rate Loan.
(c) Unless the Agent shall have been notified by any
Lender prior to the date of a Borrowing that such Lender does not intend to make
available to the Agent such Lender's portion of the Borrowing to be made on such
date, the Agent may assume that such Lender has made such amount available to
the Agent on such date and the Agent may make available to Borrower a cor
responding amount. If such corresponding amount is not in fact made available to
the Agent by such Lender on the date of Borrowing, the Agent shall be entitled
to recover such corresponding amount on demand from such Lender together with
interest at the Federal Funds Rate. If such Lender does not pay such
corresponding amount forthwith upon the Agent's demand therefor, the Agent shall
promptly notify Borrower, and Borrower shall immediately pay such corresponding
amount to the Agent together with interest at the rate specified for the
Borrowing. Nothing in this subsection shall be deemed to relieve any Lender from
its obligation to fund its Commitment or Bid Rate Loans
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hereunder or to prejudice any rights which Borrower may have against any Lender
as a result of any default by such Lender hereunder.
(d) All Syndicated Loans under the Commitments shall be
loaned by the Lenders on the basis of their Pro Rata Share of the Commitments.
All Bid Rate Loans shall be loaned by the Lenders participating therein in
accordance with their respective pro rata shares thereof as determined in
accordance with Section 2.09 with respect to each Bid Loan. All Swing Line Loans
shall be made available by the Swing Line Lender in accordance with Section 2.08
with respect to each Swing Line Loan. No Lender shall be responsible for any
default by any other Lender in its obligations hereunder, and each Lender shall
be obligated to make the Loans provided to be made by it hereunder, regardless
of the failure of any other Lender to fund its Commitments or Bid Rate Loans
hereunder.
SECTION 3.03. INTEREST.
(a) Borrower agrees to pay interest in respect of all
unpaid principal amounts of Syndicated Loans from the respective dates such
principal amounts were advanced to maturity (whether by acceleration, notice of
prepayment or otherwise) at rates per annum equal to the applicable rates
indicated below:
(i) For Base Rate Advances--The Base Rate in
effect from time to time; or
(ii) For Eurodollar Advances--The relevant
Adjusted LIBO Rate plus the Applicable Margin;
(b) Borrower agrees to pay interest in respect of all
unpaid principal amounts of the Swing Line Loans made to Borrower from the
respective dates such principal amounts were advanced to maturity (whether by
acceleration, notice of prepayment or otherwise) at the Transaction Rate
established for such Loan pursuant to Section 2.08;
(c) Borrower agrees to pay interest in respect of all
unpaid principal amounts of the Bid Rate Loans made to Borrower from the
respective dates such principal amounts were advanced to maturity (whether by
acceleration, notice of prepayment or otherwise) at the Bid Rate established for
such Loan pursuant to Section 2.09;
(d) Overdue principal and, to the extent not prohibited
by applicable law, overdue interest, in respect of the Loans, and all other
overdue amounts owing hereunder, shall bear interest from each date that such
amounts are overdue:
(i) in the case of overdue principal and
interest with respect to all Loans outstanding as Eurodollar Advances, Swing
Line Loans and Bid Rate Advances, at the rate otherwise applicable for the
then-current Interest Period plus an additional two percent (2.0%) per annum;
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thereafter at the rate in effect for Base Rate Advances plus an additional two
percent (2.0%) per annum; and
(ii) in the case of overdue principal and
interest with respect to all other Loans outstanding as Base Rate Advances and
all other Obligations hereunder (other than Loans), at a rate equal to the
applicable Base Rate plus an additional two percent (2.0%) per annum;
(e) Interest on each Loan shall accrue from and including
the date of such Loan to but excluding the date of any repayment thereof;
provided that, if a Loan is repaid on the same day made, one day's interest
shall be paid on such Loan. Interest on all Base Rate Advances shall be payable
quarterly in arrears on the last calendar day of each calendar quarter of
Borrower in each year. Interest on all outstanding Eurodollar Advances, Swing
Line Advances and Bid Rate Advances shall be payable on the last day of each
Interest Period applicable thereto, and, in the case of Interest Periods in
excess of three months, on each day which occurs every 3 months, as the case may
be, after the initial date of such Interest Period. Notwithstanding the
foregoing, interest on all Loans shall be payable on any conversion of any
Advances comprising such Loans into Advances of another Type, prepayment (on the
amount prepaid), at maturity (whether by acceleration, notice of prepayment or
otherwise) and, after maturity, on demand; and
(f) The Agent, upon determining the Adjusted LIBO Rate
for any Interest Period, shall promptly notify by telephone (confirmed in
writing) or in writing Borrower and the other Lenders. Any such determination
shall, absent manifest error, be final, conclusive and binding for all purposes.
SECTION 3.04. INTEREST PERIODS.
(a) In connection with the making or continuation of, or
conversion into, each Borrowing of Eurodollar Advances, Borrower shall select an
Interest Period to be applicable to such Eurodollar Advances, which Interest
Period shall be either a 1, 2, 3 or 6 month period.
(b) In connection with the making of each Bid Rate Loan,
Borrower shall request an Interest Period to be applicable thereto, which
Interest Period shall be for a minimum of seven (7) days and a maximum of one
hundred and eighty (180) days, which request may be accepted or rejected by the
Lenders as provided in Section 2.09 hereof.
(c) In connection with the making of each Swing Line
Loan, Borrower shall request an Interest Period to be applicable thereto, which
Interest Period shall be for a minimum of one (1) day and a maximum of thirty
(30) days, which request may be accepted or rejected by the Lenders as provided
in Section 2.08 hereof
(d) Notwithstanding paragraphs (a), (b) or (c) above:
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(i) The initial Interest Period for any
Borrowing of Eurodollar Advances shall commence on the date of such Borrowing
(including the date of any conversion from a Borrowing consisting of Advances of
another Type) and each Interest Period occurring thereafter in respect of such
Borrowing shall commence on the day on which the next preceding Interest Period
expires;
(ii) If any Interest Period would otherwise
expire on a day which is not a Business Day, such Interest Period shall expire
on the next succeeding Business Day, provided that if any Interest Period in
respect of Eurodollar Advances would otherwise expire on a day that is not a
Business Day but is a day of the month after which no further Business Day
occurs in such month, such Interest Period shall expire on the next preceding
Business Day;
(iii) Any Interest Period in respect of Eurodollar
Advances which begins on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period shall, subject to
part (iv) below, expire on the last Business Day of such calendar month; and
(iv) No Interest Period with respect to the Loans
shall extend beyond the Maturity Date.
SECTION 3.05. FEES.
(a) Borrower shall pay to the Agent, for the account of
and distribution of the respective Pro Rata Share to each Lender, a facility fee
(the "Facility Fee") for the period commencing on the Closing Date to and
including the Maturity Date, computed at a rate equal to the Applicable Facility
Percentage per annum multiplied by the average daily Commitments of the Lenders,
such fee being payable quarterly in arrears on the last day of each fiscal
quarter of Borrower and on the Maturity Date.
(b) Borrower agrees to pay to the Agent, for the account
of the Lenders, a letter of credit fee equal to the Applicable Margin applicable
to Eurodollar Advances multiplied by the daily average amount of Letter of
Credit Obligations (the "Letter of Credit Fee"). The Letter of Credit Fee shall
be payable by Borrower quarterly, in arrears, on the date which is the last day
of each fiscal quarter of Borrower, and on the Maturity Date.
(c) Borrower shall pay to the Agent such fees for its
administrative services in the respective amounts and on the dates as previously
agreed in writing by Borrower with the Agent.
SECTION 3.06. VOLUNTARY PREPAYMENTS OF BORROWINGS.
(a) Borrower may, at its option, prepay Borrowings
consisting of Base Rate Advances, Swing Line Loans, Eurodollar Advances and Bid
Rate Advances at any time in whole,
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or from time to time in part, in amounts aggregating $1,000,000 or any greater
integral multiple of $100,000, by paying the principal amount to be prepaid
together with interest accrued and unpaid thereon to the date of prepayment,
together with, in the case of Eurodollar Advances and Bid Rate Advances, all
compensation payments pursuant to Section 3.12 if such prepayment is made on a
date other than the last day of the Interest Period applicable thereto. Each
such optional prepayment shall be applied in accordance with Section 3.06(c)
below.
(b) Borrower shall give written notice (or telephonic
notice confirmed in writing) to the Agent of any intended prepayment of the
Loans (x) not less than three Business Days prior to any prepayment in the case
of prepayment of Eurodollar Advances and Bid Rate Advances and (y) by 11:00 a.m.
(local time for the Agent) on the date of prepayment of any Base Rate Advances
or Swing Line Advances. Such notice, once given, shall be irrevocable. Upon
receipt of such notice of prepayment, the Agent shall promptly notify each
Lender of the contents of such notice and of such Lender's share of such
prepayment (provided that notices of prepayments of Bid Rate Loans shall only be
given to the Lenders participating therein).
(c) Borrower, when providing notice of prepayment
pursuant to Section 3.06(b), may designate the Types of Advances and the
specific Borrowing or Borrowings which are to be prepaid provided that each
prepayment made pursuant to a single Borrowing shall be applied pro rata among
the Advances comprising such Borrowing. In the absence of a designation by
Borrower, the Agent shall, subject to the foregoing, make such designation in
its sole discretion. All voluntary prepayments shall be applied to the payment
of interest on the Borrowings prepaid before application to principal.
SECTION 3.07. PAYMENTS, ETC.
(a) All payments under this Agreement and the other
Credit Documents shall be made without defense, set-off or counterclaim and,
other than as specifically provided herein and payments made in respect of Swing
Line Loans (as more particularly described in this clause (a)), shall be made to
the Agent at its Payment Office not later than 1:00 PM (local time for the
Agent) on the date when due and all payments hereunder shall be made in Dollars
in immediately available funds. All payments with respect to the Swing Line
Loans shall be made without defense, set-off or counterclaim to the Swing Line
Lender no later than 1:00 PM (local time for the Swing Line Lender) on the date
when due (with a notification of such payment to the Agent) and shall be made in
Dollars in immediately available funds at the Swing Line Lender's Lending
Office, as set forth on the signature pages to this Agreement.
(b) (i) All such payments shall be made free and
clear of and without deduction or withholding for any Taxes in respect of this
Agreement, the Notes or other Credit Documents, or any payments of principal,
interest, fees or other amounts payable hereunder or thereunder (but excluding,
except as provided in paragraph (iii) hereof, any Taxes imposed on the
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overall net income of the Lenders pursuant to the laws of the jurisdiction
(national, state or local) in which the principal executive office or
appropriate Lending Office of such Lender is located). If any such Taxes are so
levied or imposed, Borrower agrees (A) to pay the full amount of such Taxes, and
such additional amounts as may be necessary so that every net payment of all
amounts due hereunder and under the Notes and other Credit Documents, after
withholding or deduction for or on account of any such Taxes (including
additional sums payable under this Section 3.07), will not be less than the full
amount provided for herein had no such deduction or withholding been required,
(B) to make such withholding or deduction and (C) to pay the full amount
deducted to the relevant authority in accordance with applicable law. Borrower
will furnish to the Agent and each Lender, within 30 days after the date the
payment of any Taxes is due pursuant to applicable law, certified copies of tax
receipts evidencing such payment by Borrower. Borrower will indemnify and hold
harmless the Agent and each Lender and reimburse the Agent and each Lender upon
written request for the amount of any such Taxes so levied or imposed and paid
by the Agent or Lender and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
were correctly or illegally asserted. A certificate as to the amount of such
payment by such Lender or the Agent, absent manifest error, shall be final,
conclusive and binding for all purposes.
(ii) Each Lender that is organized under the laws
of any jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) agrees to furnish to Borrower and the
Agent, prior to the time it becomes a Lender hereunder, two copies of either
U.S. Internal Revenue Service Form 4224 or U.S. Internal Revenue Service Form
1001 or any successor forms thereto (wherein such Lender claims entitlement to
complete exemption from or reduced rate of U.S. Federal withholding tax on
interest paid by Borrower hereunder) and to provide to Borrower and the Agent a
new Form 4224 or Form 1001 or any successor forms thereto if any previously
delivered form is found to be incomplete or incorrect in any material respect or
upon the obsolescence of any previously delivered form; provided, however, that
no Lender shall be required to furnish a form under this paragraph (ii) if it is
not entitled to claim an exemption from or a reduced rate of withholding under
applicable law. A Lender that is not entitled to claim an exemption from or a
reduced rate of withholding under applicable law, promptly upon written request
of Borrower, shall so inform Borrower in writing.
(iii) Borrower shall also reimburse the Agent and
each Lender, upon written request, for any Taxes imposed (including, without
limitation, Taxes imposed on the overall net income of the Agent or Lender or
its applicable Lending Office pursuant to the laws of the jurisdiction
(national, state or local) in which the principal executive office or the
applicable Lending Office of the Agent or Lender is located) as the Agent or
Lender shall determine are payable by the Agent or Lender in respect of amounts
paid by or on behalf of Borrower to or on behalf of the Agent or Lender pursuant
to paragraph (i) hereof.
(c) Subject to Section 3.04(d)(ii) and (iii), whenever
any payment to be made hereunder or under any Note shall be stated to be due on
a day which is not a Business Day, the due
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date thereof shall be extended to the next succeeding Business Day and, with
respect to payments of principal, interest thereon shall be payable at the
applicable rate during such extension.
(d) All computations of interest and fees shall be made
on the basis of a year of 360 days for the actual number of days (including the
first day but excluding the last day) occurring in the period for which such
interest or fees are payable (to the extent computed on the basis of days
elapsed). Interest on Base Rate Advances shall be calculated based on the Base
Rate from and including the date of such Loan to but excluding the date of the
repayment or conversion thereof. Interest on Eurodollar Advances and Bid Rate
Advances shall be calculated as to each Interest Period from and including the
first day thereof to but excluding the last day thereof. Each determination by
the Agent of an interest rate or fee hereunder shall be made in good faith and,
except for manifest error, shall be final, conclusive and binding for all
purposes.
(e) Payment by Borrower to the Agent in accordance with
the terms of this Agreement shall, as to Borrower, constitute payment to the
Lenders under this Agreement.
SECTION 3.08. INTEREST RATE NOT ASCERTAINABLE, ETC. In the
event that the Agent shall have determined (which determination shall be made in
good faith and, absent manifest error, shall be final, conclusive and binding
upon all parties) that on any date for determining the Adjusted LIBO Rate for
any Interest Period, by reason of any changes arising after the date of this
Agreement affecting the London interbank market, adequate and fair means do not
exist for ascertaining the applicable interest rate on the basis provided for in
the definition of Adjusted LIBO Rate then, and in any such event, the Agent
shall forthwith give notice (by telephone confirmed in writing) to Borrower and
to the Lenders, of such determination and a summary of the basis for such
determination. Until the Agent notifies Borrower that the circumstances giving
rise to the suspension described herein no longer exist, the obligations of the
Lenders to make or permit portions of the Loans to remain outstanding past the
last day of the then current Interest Periods as Eurodollar Advances shall be
suspended, and such affected Advances shall bear interest at the Base Rate (or
at such other rate of interest per annum as Borrower and each of the Agent and
the Lenders shall have agreed to in writing).
SECTION 3.09. ILLEGALITY.
(a) In the event that any Lender shall have determined
(which determination shall be made in good faith and, absent manifest error,
shall be final, conclusive and binding upon all par ties) at any time that the
making or continuance of any Eurodollar Advance has become unlawful by
compliance by such Lender in good faith with any applicable law, governmental
rule, regulation, guideline or order (whether or not having the force of law and
whether or not failure to comply therewith would be unlawful), then, in any such
event, the Lender shall give prompt notice (by telephone confirmed in writing)
to Borrower and to the Agent of such determination and a summary
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of the basis for such determination (which notice the Agent shall promptly
transmit to the other Lenders).
(b) Upon the giving of the notice to Borrower referred to
in subsection (a) above, (i) Borrower's right to request and such Lender's
obligation to make Eurodollar Advances shall be immediately suspended, and such
Lender shall make an Advance as part of the requested Borrowing of Eurodollar
Advances, bearing interest at the Base Rate (or at such other rate of interest
per annum as Borrower and each of the Agent and the Lenders shall have agreed to
in writing), which Base Rate Advance shall, for all other purposes, be
considered part of such Borrowing, and (ii) if the affected Eurodollar Advance
or Advances are then outstanding, Borrower shall immediately, or if permitted by
applicable law, no later than the date permitted thereby, upon at least one
Business Day's written notice to the Agent and the affected Lender, convert each
such Advance into an Advance or Advances of a different Type with an Interest
Period ending on the date on which the Interest Period applicable to the
affected Eurodollar Advances expires, provided that if more than one Lender is
affected at any time, then all affected Lenders must be treated the same
pursuant to this Section 3.09(b).
(c) Notwithstanding any other provision contained in this
Agreement, the Agent shall not be obligated to issue any Letter of Credit, nor
shall any Lender be obligated to purchase its participation in any Letter of
Credit to be issued hereunder, if the issuance of such Letter of Credit or
purchase of such participation shall have become unlawful or prohibited by
compliance by Agent or such Lender in good faith with any law, governmental
rule, guideline, request, order, injunction, judgment or decree (whether or not
having the force of law); provided that in the case of the obligation of a
Lender to purchase such participation, such Lender shall have notified the Agent
to such effect at least three (3) Business Days' prior to the issuance thereof
by the Agent, which notice shall relieve the Agent of its obligation to issue
such Letter of Credit pursuant to Section 2.04 and Section 2.05 hereof.
SECTION 3.10. INCREASED COSTS.
(a) (i) If, by reason of (x) after the date hereof, the
introduction of or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in or in the interpretation
of any law or regulation, or (y) the compliance with any guideline or request
from any central bank or other governmental authority or quasi-governmental
authority exercising control over banks or financial institutions generally
(whether or not having the force of law):
(1) any Lender (or its applicable Lending
Office) shall be subject to any tax, duty or other charge with respect to its
Eurodollar Advances, Letter of Credit Obligations or its obligation to make
Eurodollar Advances or to issue Letters of Credit, or the basis of taxation of
payments to any Lender of the principal of or interest on its Eurodollar
Advances, Letter of Credit Obligations or its obligation to make Eurodollar
Advances or to issue Letters of Credit shall have changed (except for changes in
the tax on the overall net income of such Lender or its applicable
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Lending Office imposed by the jurisdiction (national, state or local) in which
such Lender's principal executive office or applicable Lending Office is
located); or
(2) any reserve (including, without limitation,
any imposed by the Board of Governors of the Federal Reserve System),
special deposit or similar requirement against assets of, deposits with
or for the account of, or credit extended by, any Lender's applicable
Lending Office shall be imposed or deemed applicable or any other
condition affecting its Eurodollar Advances, Letter of Credit
Obligations or its obligation to make Eurodollar Advances shall be
imposed on any Lender or its applicable Lending Office or the London
interbank market;
and as a result thereof there shall be any increase in the cost to such Lender
of agreeing to make or making, funding or maintaining Eurodollar Advances or
Letters of Credit (except to the extent already included in the determination of
the applicable Adjusted LIBO Rate), or there shall be a reduction in the amount
received or receivable by such Lender or its applicable Lending Office, or
(ii) in the event that any Lender shall have
determined that any law, treaty, governmental (or quasi-governmental) rule,
regulation, guideline or order regarding capital adequacy not currently in
effect or fully applicable as of the Closing Date, or any change therein or in
the interpretation or application thereof after the Closing Date, or compliance
by such Lender with any request or directive regarding capital adequacy not
currently in effect or fully applicable as of the Closing Date (whether or not
having the force of law and whether or not failure to comply therewith would be
unlawful) from a central bank or governmental authority or body having
jurisdiction, does or shall have the effect of reducing the rate of return on
such Lender's capital as a consequence of its obligations hereunder to a level
below that which such Lender could have achieved but for such law, treaty, rule,
regulation, guideline or order, or such change or compliance (taking into
consideration such Lender's policies with respect to capital adequacy) by an
amount deemed by such Lender to be material;
then, in the case of (i) or (ii) above (subject, in the case of certain Taxes,
to the applicable provisions of Section 3.07(b)), upon written notice from and
demand by such Lender on Borrower (with a copy of such notice and demand to the
Agent), Borrower shall pay to the Agent for the account of such Lender within
five Business Days after the date of such notice and demand, additional amounts
sufficient to indemnify such Lender against such increased cost or reduced
yield. A certificate as to the amount of such increased cost or reduced yield
submitted to Borrower and the Agent by such Lender in good faith and accompanied
by a statement prepared by such Lender describing in reasonable detail the basis
for and calculation of such increased cost, shall, except for manifest error, be
final, conclusive and binding for all purposes.
(b) If any Lender shall advise the Agent that at any
time, because of the circumstances described in clauses (x) or (y) in Section
3.10(a) or any other circumstances beyond
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such Lender's reasonable control arising after the date of this Agreement
affecting such Lender or the London interbank market or such Lender's position
in such markets, the Adjusted LIBO Rate as determined by the Agent, will not
adequately and fairly reflect the cost to such Lender of funding its Eurodollar
Advances, then, and in any such event:
(i) the Agent shall forthwith give notice (by
telephone confirmed in writing) to Borrower and to the other Lenders of such
advice;
(ii) Borrower's right to request and such
Lender's obligation to make or permit portions of the Loans to remain
outstanding past the last day of the then current Interest Periods as Eurodollar
Advances shall be immediately suspended; and
(iii) such Lender shall make an Advance as part of
the requested Borrowing of Eurodollar Advances, as the case may be, bearing
interest at the Base Rate (or at such other rate of interest per annum as
Borrower and each of the Agent and the Lenders shall have agreed to in writing),
which Base Rate Advance shall, for all other purposes, be considered part of
such Borrowing.
SECTION 3.11. LENDING OFFICES.
(a) Each Lender agrees that, if requested by Borrower, it
will use reasonable efforts (subject to overall policy considerations of such
Lender) to designate an alternate Lending Office with respect to any of its
Eurodollar Advances affected by the matters or circumstances described in
Sections 3.07(b), 3.08, 3.09 or 3.10 to reduce the liability of Borrower or
avoid the results provided thereunder, so long as such designation is not
disadvantageous to such Lender as determined by such Lender, which determination
if made in good faith, shall be conclusive and binding on all parties hereto.
Nothing in this Section 3.11 shall affect or postpone any of the obligations of
Borrower or any right of any Lender provided hereunder.
(b) If any Lender that is organized under the laws of any
jurisdiction other than the United States of America or any State thereof
(including the District of Columbia) issues a public announcement with respect
to the closing of its lending offices in the United States such that any
withholdings or deductions and additional payments with respect to Taxes may be
required to be made by Borrower thereafter pursuant to Section 3.07(b), such
Lender shall use reasonable efforts to furnish Borrower notice thereof as soon
as practicable thereafter; provided, however, that no delay or failure to
furnish such notice shall in any event release or discharge Borrower from its
obligations to such Lender pursuant to Section 3.07(b) or otherwise result in
any liability of such Lender.
SECTION 3.12. FUNDING LOSSES. Borrower shall compensate each
Lender, upon its written request to Borrower (which request shall set forth the
basis for requesting such amounts in reasonable detail and which request shall
be made in good faith and, absent manifest error, shall be final, conclusive and
binding upon all of the parties hereto), for all losses, expenses and
liabilities (including, without limitation, any interest paid by such Lender to
lenders of funds borrowed by it
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to make or carry its Eurodollar Advances or Bid Rate Advances, in either case to
the extent not re covered by such Lender in connection with the re-employment of
such funds but excluding any loss of anticipated profits), which the Lender may
sustain: (i) if for any reason (other than a default by such Lender) a borrowing
of, or conversion to or continuation of, Eurodollar Advances or Bid Rate
Advances to Borrower does not occur on the date specified therefor in a Notice
of Borrowing, Bid Request or Notice of Conversion/Continuation, (whether or not
withdrawn), or (ii) if any repayment (including mandatory prepayments and any
conversions pursuant to Section 3.09(b)) of any Eurodollar Advances or Bid Rate
Advances by Borrower occurs on a date which is not the last day of an Interest
Period applicable thereto.
SECTION 3.13. ASSUMPTIONS CONCERNING FUNDING OF EURODOLLAR
ADVANCES. Calculation of all amounts payable to a Lender under this Article III
shall be made as though that Lender had actually funded its relevant Eurodollar
Advances through the purchase of deposits in the relevant market bearing
interest at the rate applicable to such Eurodollar Advances in an amount equal
to the amount of the Eurodollar Advances and having a maturity comparable to the
relevant Interest Period and through the transfer of such Eurodollar Advances
from an offshore office of that Lender to a domestic office of that Lender in
the United States of America; provided however, that each Lender may fund each
of its Eurodollar Advances in any manner it sees fit and the foregoing
assumption shall be used only for calculation of amounts payable under this
Article III.
SECTION 3.14. APPORTIONMENT OF PAYMENTS. Aggregate principal
and interest payments in respect of Loans and payments in respect of Letter of
Credit Fees and Commitment Fees shall be apportioned among all outstanding
Commitments, Letter of Credit Obligations and Loans to which such payments
relate, proportionately to the Lenders' respective pro rata portions of such
Commitments and outstanding Loans and Letter of Credit Obligations; provided
that payments with respect to the Swing Line Loans shall be payable solely to
the Swing Line Lender and payments with respect to the Bid Rate Loans shall be
payable solely to the Lenders participating in such Loan. The Agent shall
promptly distribute to each Lender at its Payment Office set forth beside its
name on the appropriate signature page hereof or such other address as any
Lender may request its share of all such payments received by the Agent.
SECTION 3.15. SHARING OF PAYMENTS, ETC. If any Lender shall
obtain any payment or reduction (including, without limitation, any amounts
received as adequate protection of a deposit treated as cash collateral under
the Bankruptcy Code) of the Obligations (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) in excess of its pro rata
portion of payments or reductions on account of such obligations obtained by all
the Lenders (other than, prior to the termination of the Commitments, payments
of principal, interest and fees with respect to the Bid Rate Loans which are
payable solely to the Lenders participating therein and payments of the Swing
Line Loans which are payable solely to the Swing Line Lender), such Lender shall
forthwith (i) notify each of the other Lenders and Agent of such receipt, and
(ii) purchase from the other Lenders such participations in the affected
obligations as shall be necessary to cause such
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purchasing Lender to share the excess payment or reduction, net of costs
incurred in connection therewith, ratably with each of them, provided that if
all or any portion of such excess payment or reduction is thereafter recovered
from such purchasing Lender or additional costs are incurred, the purchase shall
be rescinded and the purchase price restored to the extent of such recovery or
such additional costs, but without interest unless the Lender obligated to
return such funds is required to pay interest on such funds. Borrower agrees
that any Lender so purchasing a participation from another Lender pursuant to
this Section 3.15 may, to the fullest extent permitted by law, exercise all its
rights of payment (including the right of set-off) with respect to such
participation as fully as if such Lender were the direct creditor of Borrower in
the amount of such participation.
SECTION 3.16. LETTER OF CREDIT OBLIGATIONS ABSOLUTE. The
obligation of Borrower to reimburse the Agent for drawings made under Letters of
Credit issued for the account of Borrower and the Lenders' obligation to honor
their participations purchased therein shall be unconditional and irrevocable
and shall be paid strictly in accordance with the terms of this Agreement under
all circumstances, including without limitation, the following circumstances:
(a) Any lack of validity or enforceability of any Letter
of Credit;
(b) The existence of any claim, set-off, defense or other
right which Borrower or any Subsidiary or Affiliate of Borrower may have at any
time against a beneficiary or any transferee of any Letter of Credit (or any
Persons or entities for whom any such beneficiary or transferee may be acting),
any Lender or any other Person, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction (including without
limitation any underlying transaction between Borrower or any of its
Subsidiaries and Affiliates and the beneficiary for which such Letter of Credit
was procured); provided that nothing in this Section shall affect the right of
Borrower to seek relief against any beneficiary, transferee, Lender or any other
Person in any action or proceeding or to bring a counterclaim in any suit
involving such Persons;
(c) Any draft, demand, certificate or any other document
presented under any Letter of Credit proving to be forged, fraudulent or invalid
in any respect or any statement therein being untrue or inaccurate in any
respect;
(d) Payment by the Agent under any Letter of Credit
against presentation of a demand, draft or certificate or other document which
does not comply with the terms of such Letter of Credit;
(e) Any other circumstance or happening whatsoever which
is similar to any of the foregoing; or
(f) the fact that a Default or an Event of Default shall
have occurred and be continuing.
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Nothing in this Section 3.16 shall prevent an action against the Agent for its
gross negligence or willful misconduct in honoring drafts under the Letters of
Credit.
ARTICLE IV.
CONDITIONS TO BORROWINGS
The obligations of each Lender to make Advances to Borrower
and the obligation of the Agent to issue Letters of Credit for the account of
Borrower hereunder is subject to the satisfaction of the following conditions:
SECTION 4.01. CONDITIONS PRECEDENT TO INITIAL LOANS AND
LETTERS OF CREDIT. On the Closing Date, all obligations of Borrower hereunder
incurred prior to such date (including, without limitation, Borrower's
obligations to reimburse the reasonable fees and expenses of counsel to the
Agent and any fees and expenses payable to the Agent, the Co-Agents, the Lenders
and their Affiliates as previously agreed with Borrower), shall have been paid
in full, and the Agent shall have received the following, in form and substance
reasonably satisfactory in all respects to the Agent:
(a) the duly executed counterparts of this Agreement;
(b) the duly executed Revolving Credit Notes evidencing
the Commitments and the duly executed Bid Facility Notes and the duly executed
Swing Line Note evidencing the Swing Line Subcommitment;
(c) the duly executed Guaranty Agreement;
(d) a duly executed certificate of Borrower in
substantially the form of Exhibit I attached hereto and appropriately completed;
(e) certificates of the Secretary or Assistant Secretary
of each of the Credit Parties attaching and certifying copies of the resolutions
of the boards of directors of the Credit Parties, authorizing as applicable the
execution, delivery and performance of the Credit Documents;
(f) certificates of the Secretary or an Assistant
Secretary of each of the Credit Parties certifying (i) the name, title and true
signature of each officer of such entities executing the Credit Documents, and
(ii) the bylaws or comparable governing documents of such entities;
(g) certified copies of the certificate or articles of
incorporation of each Credit Party certified by the Secretary of State or the
Secretary or Assistant Secretary of such Credit Party, together with
certificates of good standing or existence, as may be available from the
Secretary of State of the jurisdiction of incorporation or organization of such
Credit Party;
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(h) copies of all documents and instruments, including
all consents, authorizations and filings, required or advisable under any
Requirement of Law or by any material Contractual Obligation of the Credit
Parties, in connection with the execution, delivery, performance, validity and
enforceability of the Credit Documents and the other documents to be executed
and delivered hereunder, and such consents, authorizations, filings and orders
shall be in full force and effect and all applicable waiting periods shall have
expired;
(i) certificates, reports and other information as the
Agent may reasonably request from any Credit Party or any Consolidated Company
in order to satisfy the Lenders as to the absence of any material liabilities or
obligations arising from (i) litigation (including without limitation, products
liability and patent infringement claims) pending or threatened against the
Credit Parties or any of their respective Consolidated Subsidiaries, (ii)
matters relating to employees of the Credit Parties or any of their respective
Consolidated Subsidiaries, including employee relations, collective bargaining
agreements, plans and other compensation and employee benefit plans, and (iii)
environmental and employee health and safety exposures to which the Credit
Parties or any of their respective Consolidated Subsidiaries may be subject, and
the plans of the such Person with respect thereto;
(j) the favorable opinion of Xxxxx, Xxxxxxxx & Xxxxxxx,
counsel to the Credit Parties, substantially in the form of Exhibit J addressed
to the Agent, the Co-Agents and each of the Lenders;
(k) the Guarantor shall have executed and delivered the
Parent Credit Agreement and all conditions precedent to the initial funding
thereunder shall have been fulfilled or waived; and
(l) all corporate proceedings and all other legal matters
in connection with the authorization, legality, validity and enforceability of
the Credit Documents shall be reasonably satisfactory in form and substance to
the Required Lenders.
SECTION 4.02. CONDITIONS TO ALL LOANS AND LETTERS OF CREDIT.
At the time of the making of all Loans and the issuance of any Letter of Credit
(before as well as after giving effect to such Loans or Letters of Credit and to
the proposed use of the proceeds thereof), the following conditions shall have
been satisfied or shall exist:
(a) there shall exist no Default or Event of Default;
(b) all representations and warranties by Borrower
contained herein shall be true and correct in all material respects with the
same effect as though such representations and warranties had been made on and
as of the date of such Loans other than those made as of a specific date;
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(c) the aggregate amount of all outstanding Loans and
Letter of Credit Obligations shall not exceed the aggregate amount of the
Commitments;
(d) since the Closing Date, there shall have been no
change which has had or could reasonably be expected to have a Materially
Adverse Effect (whether or not any notice with respect to such change has been
furnished to the Lenders pursuant to Section 6.09); provided that, this
condition shall not apply with respect to any Loan or Letter of Credit which
does not increase the aggregate amount of the Obligations outstanding under the
Commitments;
(e) there shall be no action or proceeding instituted or
pending before any court or other governmental authority or, to the knowledge of
Borrower, threatened (i) which reasonably could be expected to have a Materially
Adverse Effect, or (ii) seeking to prohibit or restrict one or more Credit
Party's ownership or operation of any portion of its business or assets, or to
compel one or more Credit Party to dispose of or hold separate all or any
portion of its businesses or assets, where such portion or portions of such
business(es) or assets, as the case may be, constitute a material portion of the
total businesses or assets of any Credit Party or their respective Consolidated
Subsidiaries; provided that, this condition shall not apply with respect to any
Loan or Letter of Credit which does not increase the aggregate amount of the
Obligations outstanding under the Commitments; and
(f) the Loans to be made and the use of proceeds thereof
or the Letters of Credit to be issued, as the case may be, shall not contravene,
violate or conflict with, or involve the Agent or any Lender in a violation of,
any law, rule, injunction, or regulation, or determination of any court of law
or other governmental authority applicable to Borrower.
Each request for a Borrowing and the acceptance by Borrower of
the proceeds thereof and each request for the issuance of a Letter of Credit
shall constitute a representation and warranty by Borrower, as of the date of
the Loans comprising such Borrowing or the date of the issuance of such Letter
of Credit, that the applicable conditions specified in Sections 4.01 and 4.02
have been satisfied or waived in writing.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Borrower (as to itself and all other Consolidated Companies)
represents and warrants as follows:
SECTION 5.01. CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Except
as set forth on Schedule 5.01(a), each of the Consolidated Companies is a
corporation duly organized, validly
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existing, and in good standing under the laws of the jurisdiction of its
incorporation. Each of the Consolidated Companies (i) has the corporate power
and authority and the legal right to own and operate its property and to conduct
its business, (ii) is duly qualified as a foreign corporation and in good
standing under the laws of each jurisdiction where failure to conduct business
would have a Materially Adverse Effect, and (iii) is in compliance with all
Requirements of Law, except where the failure to duly qualify or to comply with
applicable Requirements of Law would not have a Materially Adverse Effect. The
jurisdiction of incorporation or organization, and the ownership of all issued
and outstanding capital stock, for each Subsidiary as of the date of this
Agreement is accurately described on Schedule 5.01(b).
SECTION 5.02. CORPORATE POWER; AUTHORIZATION. Each of the
Credit Parties has the corporate power and authority to make, deliver and
perform the Credit Documents to which it is a party and has taken all necessary
corporate action to authorize the execution, delivery and performance of such
Credit Documents. No consent or authorization of, or filing with, any Person
(including, without limitation, any governmental authority), is required in
connection with the execution, delivery or performance by any Credit Party, or
the validity or enforceability against any Credit Party, of the Credit
Documents, other than such consents, authorizations or filings which have been
made or obtained (other than routine filings with the Securities and Exchange
Commission).
SECTION 5.03. ENFORCEABLE OBLIGATIONS. This Agreement has been
duly executed and delivered, and each other Credit Document will be duly
executed and delivered, by the respective Credit Parties, and this Agreement
constitutes, and each other Credit Document when executed and delivered will
constitute, legal, valid and binding obligations of the Credit Parties,
respectively, enforceable against the Credit Parties in accordance with their
respective terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity.
SECTION 5.04. NO LEGAL BAR. The execution, delivery and
performance by the Credit Parties of the Credit Documents will not violate any
Requirement of Law or cause a breach or default under any of their respective
Contractual Obligations.
SECTION 5.05. NO MATERIAL LITIGATION OR INVESTIGATIONS. Except
as set forth on Schedule 5.05 or in any notice furnished to the Lenders pursuant
to Section 6.09(c) at or prior to the respective times the representations and
warranties set forth in this Section 5.05 are made or deemed to be made
hereunder, no litigation, investigations or proceedings of or before any courts,
tribunals, arbitrators or governmental authorities are pending or, to the
knowledge of Borrower, threatened by or against any of the Consolidated
Companies, or against any of their respective properties or rev enues, existing
or future (a) with respect to any Credit Document, or any of the transactions
contemplated hereby or thereby, or (b) which, if adversely determined, would
reasonably be expected to have a Materially Adverse Effect.
SECTION 5.06. INVESTMENT COMPANY ACT, ETC. None of the
Consolidated Companies is an "investment company" or a company "controlled" by
an "investment company" (as
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each of the quoted terms is defined or used in the Investment Company Act of
1940, as amended). None of the Consolidated Companies is subject to regulation
under the Public Utility Holding Company Act of 1935, the Federal Power Act, or
any foreign, federal or local statute or regulation limiting its ability to
incur indebtedness for money borrowed, guarantee such indebtedness, or pledge
its assets to secure such indebtedness, as contemplated hereby or by any other
Credit Document.
SECTION 5.07. MARGIN REGULATIONS. No part of the proceeds of
any of the Loans will be used for any purpose which violates, or which would be
inconsistent or not in compliance with, the provisions of the applicable Margin
Regulations.
SECTION 5.08. COMPLIANCE WITH ENVIRONMENTAL LAWS.
(a) Except as set forth on Schedule 5.08 attached hereto,
the Consolidated Companies have received no notices of claims or potential
liability under, and are in compliance with, all applicable Environmental Laws,
where such claims and liabilities under, and failures to comply with, such
statutes, regulations, rules, ordinances, laws or licenses, would reasonably be
expected to result in penalties, fines, claims or other liabilities to the
Consolidated Companies in amounts in excess of five percent (5%) of Consolidated
Net Worth, either individually or in the aggregate.
(b) Except as set forth on Schedule 5.08 attached hereto,
none of the Consolidated Companies has received any notice of violation, or
notice of any action, either judicial or administrative, from any governmental
authority (whether United States or foreign) relating to the actual or alleged
violation of any Environmental Law, including, without limitation, any notice of
any actual or alleged spill, leak, or other release of any Hazardous Substance,
waste or hazardous waste by any Consolidated Company or its employees or agents,
or as to the existence of any contamination on any properties owned by any
Consolidated Company, where any such violation, spill, leak, release or
contamination would reasonably be expected to result in penalties, fines, claims
or other liabilities to the Consolidated Companies in amounts in excess of five
percent (5%) of Consolidated Net Worth, either individually or in the aggregate.
(c) Except as set forth on Schedule 5.08 attached hereto,
the Consolidated Companies have obtained all necessary governmental permits,
licenses and approvals which are material to the operations conducted on their
respective properties, including without limitation, all required material
permits, licenses and approvals for (i) the emission of air pollutants or
contaminants, (ii) the treatment or pretreatment and discharge of waste water or
storm water, (iii) the treatment, storage, disposal or generation of hazardous
wastes, (iv) the withdrawal and usage of ground water or surface water, and (v)
the disposal of solid wastes.
SECTION 5.09. INSURANCE. The Consolidated Companies currently
maintain insurance with respect to their respective properties and businesses,
with financially sound and
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reputable insurers, having coverages against losses or damages of the kinds
customarily insured against by reputable companies in the same or similar
businesses, such insurance being in amounts no less than those amounts which are
customary for such companies under similar circumstances. The Consolidated
Companies have paid all material amounts of insurance premiums now due and owing
with respect to such insurance policies and coverages, and such policies and
coverages are in full force and effect.
SECTION 5.10. NO DEFAULT. None of the Consolidated Companies
is in default under or with respect to any Contractual Obligation in any respect
which is having or is reasonably expected to have a Materially Adverse Effect.
SECTION 5.11. TAXES. Except as set forth on Schedule 5.11,
each of the Consolidated Companies has filed or caused to be filed all
declarations, reports and tax returns which are required to have been filed, and
has paid all taxes, custom duties, levies, charges and similar contributions
("taxes" in this Section 5.11) shown to be due and payable on said returns or on
any assessments made against it or its properties, and all other taxes, fees or
other charges imposed on it or any of its properties by any governmental
authority (other than those the amount or validity of which is currently being
contested in good faith by appropriate proceedings and with respect to which
reserves in conformity with GAAP have been provided in its books); and no tax
liens have been filed and, to the knowledge of Borrower, no claims are being
asserted with respect to any such taxes, fees or other charges.
SECTION 5.12. SUBSIDIARIES. Except as disclosed on Schedule
5.01(b) at or prior to the time this representation and warranty is made or
deemed to be made hereunder, Borrower has no Subsidiaries and neither Borrower
nor any Subsidiary is a joint venture partner or general partner in any
partnership.
SECTION 5.13. Intentionally Omitted.
SECTION 5.14. ERISA. Except as disclosed on Schedule 5.14 or
in any notice furnished to the Lenders pursuant to Section 6.09(c) at or prior
to the respective times the represen tations and warranties set forth in this
Section 5.14 are made or deemed to be made hereunder:
(a) Identification of Plans. None of the Consolidated
Companies nor any of their respective ERISA Affiliates maintains or contributes
to, or has during the past two years maintained or contributed to, any Plan that
is subject to Title IV of ERISA;
(b) Compliance. Each Plan maintained by the
Consolidated Companies has at all times been maintained, by its terms and in
operation, in compliance with all applicable laws, and the Consolidated
Companies are subject to no tax or penalty with respect to any Plan of such
Consolidated Company or any ERISA Affiliate thereof, including without
limitation, any tax or penalty under Title I or Title IV of ERISA or under
Chapter 43 of the Tax Code, or any tax or penalty resulting from a loss of
deduction under Sections 404, or 419 of the Tax Code, where the
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failure to comply with such laws, and such taxes and penalties, together with
all other liabilities referred to in this Section 5.14 (taken as a whole), would
in the aggregate have a Materially Adverse Effect;
(c) Liabilities. The Consolidated Companies are
subject to no liabilities (including withdrawal liabilities) with respect to any
Plans of such Consolidated Companies or any of their ERISA Affiliates, including
without limitation, any liabilities arising from Titles I or IV of ERISA, other
than obligations to fund benefits under an ongoing Plan and to pay current
contributions, expenses and premiums with respect to such Plans, where such
liabilities, together with all other liabilities referred to in this Section
5.14 (taken as a whole), would in the aggregate have a Materially Adverse
Effect;
(d) Funding. The Consolidated Companies and, with
respect to any Plan which is subject to Title IV of ERISA, each of their
respective ERISA Affiliates, have made full and timely payment of all amounts
(1) required to be contributed under the terms of each Plan and applicable law,
and (2) required to be paid as expenses (including PBGC or other premiums) of
each Plan, where the failure to pay such amounts (when taken as a whole,
including any penalties attributable to such amounts) would have a Materially
Adverse Effect. No Plan subject to Title IV of ERISA has an "amount of unfunded
benefit liabilities" (as defined in Section 4001(a)(18) of ERISA), determined as
if such Plan terminated on any date on which this representation and warranty is
deemed made, in any amount which, together with all other liabilities referred
to in this Section 5.14 (taken as a whole), would have a Materially Adverse
Effect if such amount were then due and payable. The Consolidated Companies are
subject to no liabilities with respect to post-retirement medical benefits in
any amounts which, together with all other liabilities referred to in this
Section 5.14 (taken as a whole), would have a Materially Adverse Effect if such
amounts were then due and payable.
SECTION 5.15. PATENTS, TRADEMARKS, LICENSES, ETC. Except as
set forth on Schedule 5.15 or in any notice furnished to the Lenders pursuant to
Section 6.09(d) at or prior to the respective times the representations and
warranties set forth in this Section 5.15 are made or deemed to be made
hereunder, (i) the Consolidated Companies have obtained and hold in full force
and effect all material patents, trademarks, service marks, trade names,
copyrights, licenses and other such rights, free from burdensome restrictions,
which are necessary for the operation of their respective businesses as
presently conducted, and (ii) to the best of Borrower's knowledge, no product,
process, method, service or other item presently sold by or employed by any
Consolidated Company in connection with such business infringes any patents,
trademark, service xxxx, trade name, copyright, license or other right owned by
any other person and there is not presently pending, or to the knowledge of
Borrower, threatened, any claim or litigation against or affecting any
Consolidated Company contesting such Person's right to sell or use any such
product, process, method, substance or other item where the result of such
failure to obtain and hold such benefits or such infringement would have a
Materially Adverse Effect.
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SECTION 5.16. OWNERSHIP OF PROPERTY. Except as set forth on
Schedule 5.16, each Consolidated Company has good and marketable fee simple
title to or a valid leasehold interest in all of its real property and good
title to, or a valid leasehold interest in, all of its other property, as such
properties are reflected in the consolidated balance sheet of the Consolidated
Companies as of December 31, 1997 previously delivered to the Lenders, other
than properties disposed of in the ordinary course of business since such date
or as otherwise permitted by the terms of this Agreement, subject to no Lien or
title defect of any kind, except Liens permitted hereby and title defects not
constituting material impairments in the intended use for such properties. The
Consolidated Companies enjoy peaceful and undisturbed possession under all of
their respective leases.
SECTION 5.17. FINANCIAL CONDITION. On the Closing Date and
after giving effect to the transactions contemplated by this Agreement and the
other Credit Documents, including without limitation, the use of the proceeds of
the Loans as provided in Section 2.01, each of the Credit Parties is Solvent.
SECTION 5.18. LABOR MATTERS. Since December 31, 1997, the
Consolidated Companies have experienced no strikes, labor disputes, slow downs
or work stoppages due to labor disagreements which have had, or would reasonably
be expected to have, a Materially Adverse Effect, and, to the best knowledge of
Borrower, there are no such strikes, disputes, slow downs or work stoppages
threatened against any Consolidated Company which if they occurred, would
reasonably be expected to have a Materially Adverse Effect. The hours worked and
payment made to employees of the Consolidated Companies have not been in
violation in any material respect of the Fair Labor Standards Act or any other
applicable law dealing with such matters. All payments due from the Consolidated
Companies, or for which any claim may be made against the Consolidated
Companies, on account of wages and employee health and welfare insurance and
other benefits have been paid or accrued as liabilities on the books of the
Consolidated Companies in all jurisdictions where the failure to pay or accrue
such liabilities would reasonably be expected to exceed five percent (5%) of
Consolidated Net Worth of Borrower in the aggregate.
SECTION 5.19. PAYMENT OR DIVIDEND RESTRICTIONS. Except as set
forth in Schedule 5.19 or as expressly permitted by the terms of this Agreement,
none of the Consolidated Companies is party to or subject to any agreement or
understanding restricting or limiting the payment of any dividends or other
distributions by any such Consolidated Company.
SECTION 5.20. DISCLOSURE. No representation or warranty
contained in this Agreement (including the Schedules attached hereto) or in any
other document furnished from time to time pursuant to the terms of this
Agreement, contains or will contain any untrue statement of a material fact or
omits or will omit to state any material fact necessary to make the statements
herein or therein not misleading in any material respect as of the date made or
deemed to be made. Except as may be set forth herein (including the Schedules
attached hereto) or in any notice furnished to the Lenders pursuant to Section
6.09 at or prior to the respective times the representations and warranties set
forth in this Section 5.20 are made or deemed to be made hereunder, there is no
fact
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known to Borrower which is having, or is reasonably expected to have, based on
facts and circumstances known to Borrower on the date that this representation
is made or deemed to have been made, a Materially Adverse Effect.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any
Note shall remain unpaid or any Letter of Credit shall remain outstanding,
Borrower will (unless waived in writing by the Required Lenders):
SECTION 6.01. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES.
(a) Do or cause to be done all things necessary to preserve and maintain, and
cause each of its Subsidiaries to preserve and maintain, its respective
corporate existence (except as otherwise permitted pursuant to Section 7.01(b)
hereof), its material rights, franchises, and licenses, and its material patents
and copyrights (for the scheduled duration thereof), trademarks, trade names,
and servicemarks, necessary or desirable in the normal conduct of its business,
(b) cause its properties and the properties of its Subsidiaries used or useful
in the conduct of their respective businesses to be maintained and kept in good
condition, repair and working order and supplied with all necessary equipment
and cause to be made all necessary repairs, renewals, replacements, betterments
and improvements thereto, all as in the judgment of the Borrower may be
necessary so that the businesses carried on in connection therewith may be
properly conducted at all times and (c) qualify and remain qualified, and cause
each of its Subsidiaries to qualify and remain qualified, to conduct business in
each jurisdiction where the nature of the business or ownership of property by
the Borrower, or such Subsidiary, as the case may be, may legally require such
qualification, except where the failure to comply with subsections (b) or (c)
above could not have a Materially Adverse Effect, or which in any manner draws
into question the validity or enforceability of the Credit Documents.
SECTION 6.02. COMPLIANCE WITH LAWS, ETC. Comply, and cause
each of its Subsidiaries to comply, with all applicable federal, state, and
local laws, rules, regulations and orders, including, without limitation, all
Environmental Laws, ERISA and any other employee benefit laws, except where the
failure to comply could not have a Materially Adverse Effect, or which in any
manner draws into question the validity or enforceability of the Credit
Documents.
SECTION 6.03. TAXES AND CLAIMS. Pay and discharge, and cause
each of its Subsidiaries to pay and discharge, or cause to be paid and
discharged, (a) before the same shall become delinquent, all taxes, assessments
and other governmental charges levied or imposed upon it or upon its income,
profits or properties and (b) all claims (including, without limitation, claims
for labor, materials, supplies or services) which might, if unpaid, become a
Lien upon any of its
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properties; provided, that in each case, neither the Borrower nor any Subsidiary
shall be required to pay or discharge, or cause to be paid or discharged, any
such tax, assessment, charge or claim whose amount or validity is being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves are being maintained; provided, further, that the Borrower
shall, and shall cause each Subsidiary to, pay all such taxes, assessments,
charges and claims forthwith upon the commencement of proceedings to foreclose
any Lien which may have attached as security therefor.
SECTION 6.04. COMPLIANCE WITH OTHER AGREEMENTS. Conduct, and
cause each Subsidiary to conduct, its business operations and obtain all
necessary permits and licenses in compliance with all agreements, indentures and
mortgages to which it is a party or by which it or any of its properties is
bound, except where the failure to comply could not have a Materially Adverse
Effect, or which in any manner draws into question the validity or
enforceability of the Credit Documents.
SECTION 6.05. INSPECTION OF PROPERTY. Permit any Person
designated in writing by the Agent or any Lender, at the Agent's or such
Lender's expense, to visit and inspect any of the properties of the Borrower or
any Subsidiary, to examine the corporate books and financial records of the
Borrower and its Subsidiaries and make copies thereof and take extracts
therefrom, and to discuss the affairs, finances and accounts of any of such
corporations with the principal officers of the Borrower or any Subsidiary and
its independent public accountants, all at such reasonable times and as often as
the Agent or any Lender may reasonably request.
SECTION 6.06. INSURANCE. Maintain, and cause each Subsidiary
to maintain, with financially sound and reputable carriers insurance in such
amounts and against such liabilities and hazards as customarily is maintained by
the Borrower and acceptable to the Required Lenders in its reasonable discretion
with any change in such amounts or hazards to be promptly submitted to the
Required Lenders for written approval which approval shall not be unreasonably
withheld; provided, that the Borrower and each Subsidiary may, to the extent
permitted by applicable law, maintain a system or systems of self-insurance
covering potential liabilities for workers' compensation.
SECTION 6.07. BUSINESS. Remain, and cause each Subsidiary to
remain, substantially in the respective business in which the Borrower and each
such Subsidiary is engaged as of the date of this Agreement.
SECTION 6.08. KEEPING OF BOOKS. Keep, and cause each of its
Subsidiaries to keep, proper books of record and account, containing complete
and accurate entries of all financial and business transactions of the Borrower
and each Subsidiary.
SECTION 6.09. REPORTING COVENANTS. Deliver to each Lender:
(a) promptly upon transmission thereof, copies of all
such financial statements, proxy statements, notices and reports as any Credit
Party shall send to its stockholders and copies of all registration statements
(without exhibits) and all reports which any Credit Party files with the
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Securities and Exchange Commission (or any governmental body or agency
succeeding to the functions of the Securities and Exchange Commission);
(b) promptly upon request therefor, a copy of each other
report (including without limitation management letters) submitted to any Credit
Party or its Subsidiaries by independent accountants in connection with any
annual, interim or special audit made by them of the books of any Credit Party
or its Subsidiaries;
(c) forthwith upon any Responsible Officer obtaining
knowledge of or receiving notice of:
(i) the occurrence of any Default or Event of
Default;
(ii) the institution by any Person of, or the
threat of, any action, suit or proceeding or any governmental investigation or
any arbitration, before any court or arbitrator or any governmental or
administrative body, agency, or official, against the Guarantor or any
Subsidiary which if adversely determined could have a Materially Adverse Effect
or in any manner draws into question the validity or enforceability of the
Credit Documents;
(iii) any actual or alleged violation, or notice
of any action, claim or request for information, either judicial or
administrative, from any governmental authority relating to any actual or
alleged claim, notice of potential responsibility under or violation of any
Environmental Law, or any actual or alleged spill, leak, disposal or other
release of any waste, petroleum product, or hazardous waste or Hazardous
Substance by any Consolidated Company which could result in penalties, fines,
claims or other liabilities to any Consolidated Company in amounts in excess of
$1,000,000;
(iv) with respect to any Plan, (A) a "reportable
event" described in Section 4043 of ERISA and the regulations issued from time
to time thereunder (other than a "reportable event" not subject to the
provisions for 30-day notice to the PBGC under such regulations), or (B) any
other event which could subject the Borrower or any ERISA Affiliate to any
material tax, penalty or liability under Title I or Title IV of ERISA or Chapter
43 of the Code;
(v) at the same time and in the same manner as
such notice must be provided to the PBGC, or to a Plan participant, beneficiary
or alternative payee, any notice required under Section 101(d), 302(f)(4), 303,
307, 4041(b)(1)(A) or 4041(c)(I)(A) of ERISA or under Section 401(a)(29) or 412
of the Code with respect to any Plan; and
(vi) a default under any agreement or instrument
evidencing Debt for which the Borrower or any Subsidiary is liable, which
individually or in the aggregate with all other
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agreements or instruments in default for which the Borrower or any Subsidiary is
liable, exceed $2,000,000;
the Borrower will deliver an Officer's Certificate of the Borrower setting forth
the details thereof and the action which the Borrower is taking or proposes to
take with respect thereto;
(d) Promptly upon the existence or occurrence thereof,
notice of the existence or occurrence of failure of any Consolidated Company to
hold in full force and effect those trademarks, service marks, patents, trade
names, copyrights, licenses and similar rights necessary in the normal conduct
of its business, the loss or absence of which could have a Materially Adverse
Effect; and
(e) With reasonable promptness, any other information
about the Credit Parties and the Consolidated Companies as the Agent or any
Lender, through the Agent, may reasonably request from time to time.
SECTION 6.10. COVENANT TO SECURE NOTES EQUALLY. If the
Borrower or any Subsidiary shall create or assume any Lien upon any of its
property or assets, whether now owned or hereafter acquired, other than as
permitted by Section 7.02(a) of the Parent Credit Agreement, as incorporated by
reference into the Guaranty Agreement, make or cause to be made effective
provision whereby the Notes will be secured by such Lien equally and ratably
with all other Debt thereby secured so long as any such other Debt shall be so
secured.
ARTICLE VII.
NEGATIVE COVENANTS
So long as any Commitment remains in effect hereunder or any
Note shall remain unpaid or any Letter of Credit Obligation shall remain
outstanding, Borrower will not and will not permit any Subsidiary to (unless
waived in writing by the Required Lenders) :
SECTION 7.01. NEGATIVE COVENANTS.
(a) Covenants of Guaranty Agreement. Breach any of the
covenants incorporated by reference from the Parent Credit Agreement into the
Guaranty Agreement.
(b) Merger or Consolidation. Merge, consolidate or
exchange shares with any other Person, except that:
(i) any Subsidiary may merge or consolidate with
the Borrower or another Subsidiary;
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(ii) the Borrower may merge or consolidate with
any other corporation (including a Subsidiary) if the continuing or surviving
corporation is organized under the laws of, and with a majority of its assets
located in, the United States or a state thereof or the District of Columbia and
the continuing or surviving corporation (if not the Borrower) assumes the
obligations of the Borrower hereunder under an agreement reasonably acceptable
to the Required Lenders, and immediately after such merger or consolidation, no
Default or Event of Default shall have occurred or exist; and
(iii) any Subsidiary may merge with another Person
in connection with an acquisition of such Person permitted under the terms of
the Credit Documents; provided that, following such merger, the Borrower owns
the same percentage of outstanding voting stock of the surviving entity as
Borrower owned of such Subsidiary prior to such merger and further provided that
no Default or Event of Default exists hereunder or would result therefrom.
ARTICLE VIII.
EVENTS OF DEFAULT
Upon the occurrence and during the continuance of any of the
following specified events (each an "Event of Default"):
SECTION 8.01. PAYMENTS. Borrower shall fail to make promptly
when due (including, without limitation, by mandatory prepayment) any principal
payment with respect to the Loans, or Borrower shall fail to make within five
(5) days after the due date thereof any payment of interest, fee or other amount
payable hereunder or any of the Obligations;
SECTION 8.02. COVENANTS WITHOUT NOTICE. Borrower shall fail to
observe or perform any covenant or agreement contained in Sections 6.09(c) (i),
or Article VII hereof (subject in the case of covenants incorporated by
reference into Article VII, to any grace period provided in the Parent Credit
Agreement with respect thereto);
SECTION 8.03. OTHER COVENANTS. Borrower shall fail to observe
or perform any covenant or agreement contained in this Agreement, other than
those referred to in Sections 8.01 and 8.02, and, if capable of being remedied,
such failure shall remain unremedied for thirty (30) days (or in the case of
failure to observe or perform the covenants or agreements set forth in any other
subsection of Section 6.09, ten (10) days) after the earlier of (i) Borrower's
obtaining knowledge thereof, or (ii) written notice thereof shall have been
given to Borrower by Agent or any Lender;
SECTION 8.04. REPRESENTATIONS. Any representation, warranty or
statement made or deemed to be made by Borrower or any other Credit Party or by
any of its officers under this
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Agreement or any other Credit Document (including the Schedules attached
thereto), or any certificate or other document submitted to the Agent or the
Lenders by any such Person pursuant to the terms of this Agreement or any other
Credit Document, shall be incorrect in any material respect when made or deemed
to be made or submitted;
SECTION 8.05. NON-PAYMENTS OF OTHER DEBT. Borrower or any of
its Subsidiaries fail to make when due (whether at stated maturity, by
acceleration, on demand or otherwise, and after giving effect to any applicable
grace period) any payment of principal of or interest on any Debt (other than
the Obligations) exceeding $5,000,000 in the aggregate;
SECTION 8.06. DEFAULTS UNDER OTHER AGREEMENTS. Borrower or any
of its Subsidiaries shall fail to observe or perform within any applicable grace
period any covenants or agreements contained in any agreements or instruments
relating to any of its Debt exceeding $5,000,000 in the aggregate, or any other
event shall occur if the effect of such failure or other event is to accelerate,
or to permit the holder of such Debt or any other Person to accelerate, the
maturity of such Debt; or any such Debt shall be required to be prepaid (other
than by a regularly scheduled required prepayment) in whole or in part prior to
its stated maturity;
SECTION 8.07. BANKRUPTCY. Any Credit Party or any of their
respective Subsidiaries shall commence a voluntary case concerning itself under
the Bankruptcy Code or applicable foreign bankruptcy laws; or an involuntary
case for bankruptcy is commenced against any such Person and the petition is not
controverted within 10 days, or is not dismissed within 60 days, after
commencement of the case; or a custodian (as defined in the Bankruptcy Code) or
similar official under applicable foreign bankruptcy laws is appointed for, or
takes charge of, all or any substantial part of the property of any of any
Credit Party or any of their respective Subsidiaries; or any of the Credit
Parties or any of their respective Subsidiaries commences proceedings of its own
bankruptcy or to be granted a suspension of payments or any other proceeding
under any reorganization, arrangement, adjustment of debt, relief of debtors,
dissolution, insolvency or liquidation or similar law of any jurisdiction,
whether now or hereafter in effect, relating to any such Person or there is
commenced against any of the Credit Parties or any of their respective
Subsidiaries any such proceeding which remains undismissed for a period of 60
days; or any of the Credit Parties or any of their respective Subsidiaries is
adjudicated insolvent or bankrupt; or any order of relief or other order
approving any such case or proceeding is entered; or any of the Credit Parties
or any of their respective Subsidiaries suffers any appointment of any custodian
or the like for it or any substantial part of its property to continue
undischarged or unstayed for a period of 60 days; or any of the Credit Parties
or any of their respective Subsidiaries makes a general assignment for the
benefit of creditors; or any of the Credit Parties or any of their respective
Subsidiaries shall fail to pay, or shall state that it is unable to pay, or
shall be unable to pay, its debts generally as they become due; or any of the
Credit Parties or any of their respective Subsidiaries shall call a meeting of
its creditors with a view to arranging a composition or adjustment of its debts;
or any of the Credit Parties or any of their respective Subsidiaries shall by
any act or failure to act indicate its consent to, approval of or acquiescence
in any of the foregoing; or any corporate action is taken by any of the Credit
Parties or any of their respective Subsidiaries for the purpose of effecting any
of the foregoing;
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SECTION 8.08. ERISA. A Plan of Borrower or any of its
Subsidiaries or a Plan subject to Title IV of ERISA of any of its ERISA
Affiliates:
(i) shall fail to be funded in accordance with
the minimum funding standard required by applicable law, the terms of such Plan,
Section 412 of the Tax Code or Section 302 of ERISA for any plan year or a
waiver of such standard is sought or granted with respect to such Plan under
applicable law, the terms of such Plan or Section 412 of the Tax Code or Section
303 of ERISA; or
(ii) is being, or has been, terminated or the
subject of termination proceedings under applicable law or the terms of such
Plan; or
(iii) shall require a Borrower or any of its
Subsidiaries to provide security under applicable law, the terms of such Plan,
Section 401 or 412 of the Tax Code or Section 306 or 307 of ERISA; or
(iv) results for any reason, in a liability
(including without limitation, withdrawal liability) to the Borrower or any of
its Subsidiaries under applicable law, the terms of such Plan, or Title IV of
ERISA;
and there shall result from any such failure, waiver, termination or other event
a liability to the PBGC, a Plan or any other Person that would have a Materially
Adverse Effect;
SECTION 8.09. MONEY JUDGMENT. A judgment or order for the
payment of money in excess of $5,000,000 or otherwise having a Materially
Adverse Effect shall be rendered against Borrower or any of its Subsidiaries and
such judgment or order shall continue unsatisfied (in the case of a money
judgment) and in effect for a period of 30 days during which execution shall not
be ef fectively stayed or deferred (whether by action of a court, by agreement
or otherwise);
SECTION 8.10. OWNERSHIP OF BORROWER. If the Guarantor shall at
any time fail to own and control, directly or indirectly through wholly-owned
Subsidiaries, one hundred percent (100%) of the voting stock of Borrower;
SECTION 8.11. DEFAULT UNDER OTHER CREDIT DOCUMENTS OR PARENT
CREDIT AGREEMENT. There shall exist or occur any "Event of Default" as provided
under the terms of any other Credit Document, including without limitation the
Guaranty Agreement, or the Parent Credit Agreement, or any Credit Document
ceases to be in full force and effect or the validity or enforce ability thereof
is disaffirmed by or on behalf of Borrower, Guarantor or any other Credit Party,
or at any time it is or becomes unlawful for Borrower, Guarantor or any other
Credit Party to perform or comply with its obligations under any Credit
Document, or the obligations of Borrower,
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Guarantor or any other Credit Party under any Credit Document are not or cease
to be legal, valid and binding on Borrower; or
SECTION 8.12. ATTACHMENTS. An attachment or similar action
shall be made on or taken against any of the assets of Borrower or any of its
Subsidiaries with a book value exceeding $5,000,000 in aggregate and is not
removed, suspended or enjoined within 30 days of the same being made or any
suspension or injunction being lifted;
then, and in any such event, and at any time thereafter if any Event of Default
shall then be continuing, the Agent may, with the consent of the Required
Lenders, and upon the written (including telecopied) or telex request of the
Required Lenders, shall, by written notice to Borrower, take any or all of the
following actions, without prejudice to the rights of the Agent, any Lender or
the holder of any Note to enforce its claims against Borrower or any other
Credit Party: (i) declare all Commitments terminated, whereupon the pro rata
Commitments of each Lender shall terminate immediately and any commitment fee
shall forthwith become due and payable without any other notice of any kind; and
(ii) declare the principal of and any accrued interest on the Loans, and all
other Obligations owing hereunder, including without limitation, an amount equal
to the maximum amount which would be available at any time to be drawn under all
Letters of Credit then outstanding (whether or not any beneficiary under any
Letter of Credit shall have presented, or shall be entitled at such time to
present, the drafts or other documents required to draw under such Letter of
Credit), to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by Borrower; provided, that, if an Event of Default specified
in Section 8.07 shall occur, the result which would occur upon the giving of
written notice by the Agent to any Credit Party, as specified in clauses (i) and
(ii) above, shall occur automatically without the giving of any such notice; and
(iii) exercise any rights or remedies under the Security Documents. As long as
any Letter of Credit shall remain outstanding, any amounts described in clause
(ii) above with respect to Letters of Credit, when received by the Agent, shall
be deposited in a cash collateral account as cash collateral for the obligations
of Borrower under Article II of this Agreement in the event of any drawing under
a Letter of Credit, and upon drawing under any outstanding Letter of Credit in
respect of which the Agent has deposited in the cash collateral account any
amounts described in clause (ii) above, the Agent shall pay such amounts to
itself to reimburse itself for the amount of such drawing.
ARTICLE IX.
THE AGENT AND CO-AGENTS
SECTION 9.01. APPOINTMENT OF AGENT. Each Lender hereby
designates SunTrust as Agent to administer all matters concerning the Loans and
Letters of Credit and to act as herein specified. Each Lender hereby irrevocably
authorizes, and each holder of any Note by the ac ceptance of a Note shall be
deemed irrevocably to authorize, the Agent to take such actions on its behalf
under the provisions of this Agreement, the other Credit Documents, and all
other instruments and agreements referred to herein or therein, and to exercise
such powers and to perform such duties
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hereunder and thereunder as are specifically delegated to or required of the
Agent by the terms hereof and thereof and such other powers as are reasonably
incidental thereto. The Agent may perform any of its duties hereunder by or
through their agents or employees.
SECTION 9.02. AUTHORIZATION OF AGENT WITH RESPECT TO THE
SECURITY DOCUMENTS.
(a) Each Lender hereby authorizes the Agent to enter into
each of the Security Documents substantially in the form attached hereto, and to
take all action contemplated thereby. All rights and remedies under the Security
Documents may be exercised by the Agent for the benefit of the Agent and the
Lenders and the other beneficiaries thereof upon the terms thereof. The Lenders
further agree that the Agent may assign its rights and obligations under any of
the Security Documents to any affiliate of the Agent or to any trustee, if
necessary or appropriate under applicable law, which assignee in each such case
shall (subject to compliance with any requirements of applicable law governing
the assignment of such Security Documents) be entitled to all the rights of the
Agent under and with respect to the applicable Security Document.
(b) In each circumstance where, under any provision of
any Security Document, the Agent shall have the right to grant or withhold any
consent, exercise any remedy, make any determination or direct any action by the
Agent under such Security Document, the Agent shall act in respect of such
consent, exercise of remedies, determination or action, as the case may be, with
the consent of and at the direction of the Required Lenders; provided, however,
that no such consent of the Required Lenders shall be required with respect to
any consent, determination or other matter that is, in the Agent's judgment,
ministerial or administrative in nature. In each circumstance where any consent
of or direction from the Required Lenders is required, the Agent shall send to
the Lend ers a notice setting forth a description in reasonable detail of the
matter as to which consent or direction is requested and the Agent's proposed
course of action with respect thereto. The Lenders shall endeavor to respond
promptly to such request but in the event the Agent shall not have received a
response from any Lender within five (5) Business Days after such Lender's
receipt of such notice, such Lender shall be deemed not to have agreed to the
course of action proposed by the Agent.
SECTION 9.03. NATURE OF DUTIES OF AGENT. The Agent shall have
no duties or responsibilities except those expressly set forth in this Agreement
and the other Credit Documents. None of the Agent nor any of its respective
officers, directors, employees or agents shall be liable for any action taken or
omitted by it as such hereunder or in connection herewith, unless caused by its
or their gross negligence or willful misconduct. The duties of the Agent shall
be ministerial and administrative in nature; the Agent shall not have by reason
of this Agreement a fiduciary relationship in respect of any Lender; and nothing
in this Agreement, express or implied, is intended to or shall be so construed
as to impose upon the Agent any obligations in respect of this Agreement or the
other Credit Documents except as expressly set forth herein.
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SECTION 9.04. LACK OF RELIANCE ON THE AGENT.
(a) Independently and without reliance upon the Agent,
each Lender, to the extent it deems appropriate, has made and shall continue to
make (i) its own independent investigation of the financial condition and
affairs of the Credit Parties in connection with the taking or not taking of any
action in connection herewith, and (ii) its own appraisal of the
creditworthiness of the Credit Parties, and, except as expressly provided in
this Agreement, the Agent shall have no duty or responsibility, either initially
or on a continuing basis, to provide any Lender with any credit or other
information with respect thereto, whether coming into its possession before the
making of the Loans or at any time or times thereafter.
(b) The Agent shall not be responsible to any Lender for
any recitals, statements, information, representations or warranties herein or
in any document, certificate or other writing delivered in connection herewith
or for the execution, effectiveness, genuineness, validity, enforceability,
collectibility, priority or sufficiency of this Agreement, the Notes, the
Guaranty Agreement, or any other documents contemplated hereby or thereby, or
the financial condition of the Credit Parties, or be required to make any
inquiry concerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement, the Notes, the Guaranty Agreement,
or the other documents contemplated hereby or thereby, or the financial
condition of the Credit Parties, or the existence or possible existence of any
Default or Event of Default; provided, however, to the extent that the Agent has
been advised that a Lender has not received any information formally delivered
to the Agent pursuant to Section 6.09, the Agent shall deliver or cause to be
delivered such information to such Lender.
SECTION 9.05. CERTAIN RIGHTS OF THE AGENT. If the Agent shall
request instructions from the Required Lenders with respect to any action or
actions (including the failure to act) in connection with this Agreement, the
Agent shall be entitled to refrain from such act or taking such act, unless and
until the Agent shall have received instructions from the Required Lenders; and
the Agent shall not incur liability in any Person by reason of so refraining.
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against the Agent as a result of the Agent acting or refraining from
acting hereunder in accordance with the instructions of the Required Lenders.
SECTION 9.06. RELIANCE BY AGENT. The Agent shall be entitled
to rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or telecopier
message, cable gram, radiogram, order or other documentary, teletransmission or
telephone message believed by it to be genuine and correct and to have been
signed, sent or made by the proper Person. The Agent may consult with legal
counsel (including counsel for any Credit Party), independent public accountants
and other experts selected by it and shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the advice of such
counsel, accountants or experts.
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SECTION 9.07. INDEMNIFICATION OF AGENT. To the extent the
Agent is not reimbursed and indemnified by the Credit Parties, each Lender will
reimburse and indemnify the Agent, ratably according to the respective amounts
of the Loans outstanding under all Facilities (or if no amounts are outstanding,
ratably in accordance with the aggregate Commitments), in either case, for and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including counsel fees and
disbursements) or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against the Agent in performing its duties
hereunder, in any way relating to or arising out of this Agreement or the other
Credit Documents; provided that no Lender shall be liable to the Agent for any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the Agent's
gross negligence or willful misconduct.
SECTION 9.08. THE AGENT IN ITS INDIVIDUAL CAPACITY. With
respect to its obligation to lend under this Agreement, the Loans made by it and
the Notes issued to it, the Agent shall have the same rights and powers
hereunder as any other Lender or holder of a Note and may exercise the same as
though it were not performing the duties specified herein; and the terms
"Lenders", "Re quired Lenders", "holders of Notes", or any similar terms shall,
unless the context clearly otherwise indicates, include the Agent in its
individual capacity. The Agent may accept deposits from, lend money to, and
generally engage in any kind of banking, trust, financial advisory or other
business with the Consolidated Companies or any affiliate of the Consolidated
Companies as if it were not performing the duties specified herein, and may
accept fees and other consideration from the Consolidated Companies for services
in connection with this Agreement and otherwise without having to account for
the same to the Lenders.
SECTION 9.09. HOLDERS OF NOTES. The Agent may deem and treat
the payee of any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment or transfer thereof shall have been
filed with the Agent. Any request, authority or consent of any Person who, at
the time of making such request or giving such authority or consent, is the
holder of any Note shall be conclusive and binding on any subsequent holder,
transferee or assignee of such Note or of any Note or Notes issued in exchange
therefor.
SECTION 9.10. SUCCESSOR AGENT.
(a) The Agent may resign at any time by giving written
notice thereof to the Lenders and Borrower and may be removed at any time with
or without cause by the Required Lenders; provided, however, the Agent may not
resign or be removed until a successor Agent has been appointed and shall have
accepted such appointment. Upon any such resignation or removal, the Required
Lenders shall have the right to appoint a successor Agent subject to Borrower's
prior written approval. 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
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behalf of the Lenders, appoint a successor Agent subject to Borrower's prior
written approval, which shall be a bank which maintains an office in the United
States, or a commercial bank organized under the laws of the United States of
America or any State thereof, or any Affiliate of such bank, having a combined
capital and surplus of at least $100,000,000.
(b) Upon the acceptance of any appointment as the Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation or
removal hereunder as Agent, the provisions of this Article IX shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was an
Agent under this Agreement.
SECTION 9.11. CO-AGENTS. Each Lender hereby designates First
Union National Bank and NationsBank, N.A. as the Co-Agents. The Co-Agents, in
such capacity, shall have no duties or obligations whatsoever under this
Agreement or any other Credit Document but shall be entitled to the protections
of this Article IX.
ARTICLE X.
MISCELLANEOUS
SECTION 10.01. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including bank wire,
telex, telecopy or similar teletransmission or writing) and shall be given to
such party at its address or applicable teletransmission number set forth on the
signature pages hereof, or such other address or applicable teletransmission
number as such party may hereafter specify by notice to the Agent and Borrower.
Each such notice, request or other communication shall be effective (i) if given
by telex, when such telex is transmitted to the telex number specified in this
Section and the appropriate answerback is received, (ii) if given by mail, 72
hours after such communication is deposited in the mails with first class
postage prepaid, addressed as aforesaid, (iii) if given by telecopy, when such
telecopy is transmitted to the telecopy number specified in this Section and the
appropriate confirmation is received, or (iv) if given by any other means
(including, without limitation, by air courier), when delivered or received at
the address specified in this Section; provided that notices to the Agent shall
not be effective until received.
SECTION 10.02. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or the other Credit Documents, nor consent to any
departure by any Credit Party therefrom, shall in any event be effective unless
the same shall be in writing and signed by Borrower and 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 that no amendment, waiver
or consent shall, unless in writing and signed by Borrower and all the Lenders
do any of the following: (i) waive any of the conditions specified in Section
4.01 or 4.02, (ii) increase the Commitments or other contractual obligations to
Borrower under this Agreement, (iii) reduce the principal of, or interest on,
the Notes or any fees hereunder, (iv) postpone any date fixed for the payment in
respect
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of principal of, or interest on, the Notes or any fees hereunder, (v) change the
percentage of the Commitments or of the aggregate unpaid principal amount of the
Notes, or the number or identity of Lenders which shall be required for the
Lenders or any of them to take any action hereunder, (vi) agree to release the
Guarantor from its obligations under the Guaranty Agreement, (vii) modify the
definition of "Required Lenders," or (viii) modify this Section 10.02.
Notwithstanding the foregoing, no amendment, waiver or consent shall, unless in
writing and signed by Borrower and the Agent in addition to the Lenders required
hereinabove to take such action, affect the rights or duties of the Agent under
this Agreement or under any other Credit Document.
SECTION 10.03. NO WAIVER; REMEDIES CUMULATIVE. No failure or
delay on the part of the Agent, the Co-Agents, any Lender or any holder of a
Note in exercising any right or remedy hereunder or under any other Credit
Document, and no course of dealing between any Credit Party and the Agent, the
Co-Agents, any Lender or the holder of any Note shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or remedy
hereunder or under any other Credit Document preclude any other or further
exercise thereof or the exercise of any other right or remedy hereunder or
thereunder. The rights and remedies herein expressly provided are cumulative and
not exclusive of any rights or remedies which the Agent, the Co-Agents, any
Lender or the holder of any Note would otherwise have. No notice to or demand on
any Credit Party not required hereunder or under any other Credit Document in
any case shall entitle any Credit Party to any other or further notice or demand
in similar or other circumstances or constitute a waiver of the rights of the
Agent, the Co-Agents, the Lenders or the holder of any Note to any other or
further action in any circumstances without notice or demand.
SECTION 10.04. PAYMENT OF EXPENSES, ETC. Borrower shall:
(i) whether or not the transactions hereby
contemplated are consummated, pay all reasonable, out-of-pocket costs and
expenses of the Agent in the administration (both before and after the execution
hereof and including reasonable expenses actually incurred relating to advice of
counsel as to the rights and duties of the Agent and the Lenders with respect
thereto) of, and in connection with the preparation, execution and delivery of,
preservation of rights under, enforcement of, and, after a Default or Event of
Default, refinancing, renegotiation or restructuring of, this Agreement and the
other Credit Documents and the documents and instruments referred to therein,
and any amendment, waiver or consent relating thereto (including, without
limitation, the reasonable fees actually incurred and reasonable disbursements
of counsel for the Agent), and in the case of enforcement of this Agreement or
any Credit Document after an Event of Default, all such reasonable,
out-of-pocket costs and expenses (including, without limitation, the reasonable
fees actually incurred and disbursements of counsel, including the allocated
cost of internal counsel), for any of the Co-Agents and the Lenders;
(ii) subject, in the case of certain Taxes, to
the applicable provisions of Section 3.07(b), pay and hold each of the Agent,
the Co-Agents and the Lenders harmless from and
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against any and all present and future stamp, documentary, and other similar
Taxes with respect to this Agreement, the Notes and any other Credit Documents,
any collateral described therein, or any payments due thereunder, and save each
of the Lenders harmless from and against any and all liabilities with respect to
or resulting from any delay or omission to pay such Taxes; and
(iii) indemnify the Agent, the Co-Agents and each
Lender, and their respective Affiliates, officers, directors, employees,
representatives and agents from, and hold each of them harmless against, any and
all costs, losses, liabilities, claims, damages or expenses incurred by any of
them (whether or not any of them is designated a party thereto) (an
"Indemnitee") arising out of or by reason of any investigation, litigation or
other proceeding related to any actual or proposed use of the proceeds of any of
the Loans or any Credit Party's entering into and performing of the Agreement,
the Notes, or the other Credit Documents, including, without limitation, the
reasonable fees actually incurred and disbursements of counsel incurred in
connection with any such investigation, litigation or other proceeding;
provided, however, Borrower shall not be obligated to indemnify any Indemnitee
for any of the foregoing arising out of such Indemnitee's gross negligence or
willful misconduct;
(iv) In addition to amounts payable elsewhere
provided in this Agreement, without duplication, indemnify, pay and save the
Agent harmless from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and reasonable expenses (including reasonable
attorney's fees and disbursements) which the Agent may incur or be subject to as
a consequence, direct or indirect, of (i) the issuance of any Letter of Credit
for the account of Borrower, other than as a result of the gross negligence or
willful misconduct of the Agent; (ii) the failure of the Agent to honor a
drawing under any Letter of Credit due to any act or omission (whether rightful
or wrongful) of any present or future de jure or de facto government or
governmental authority; or (iii) any confirmation of any Letter of Credit
obtained by the Agent with the consent of Borrower;
(v) without limiting the indemnities set forth
above, indemnify each Indemnitee for any and all expenses and costs (including
without limitation, remedial, removal, response, abatement, cleanup,
investigative, closure and monitoring costs), losses, claims (including claims
for contribution or indemnity and including the cost of investigating or
defending any claim and whether or not such claim is ultimately defeated, and
whether such claim arose before, during or after any Credit Party's ownership,
operation, possession or control of its business, property or facilities or
before, on or after the date hereof, and including also any amounts paid
incidental to any compromise or settlement by the Indemnitee or Indemnitees to
the holders of any such claim), lawsuits, liabilities, obligations, actions,
judgments, suits, disbursements, encumbrances, liens, damages (including without
limitation damages for contamination or destruction of natural resources),
penalties and fines of any kind or nature whatsoever (including without
limitation in all cases the reasonable fees actually incurred, other reasonable
charges and disbursements of counsel in connection therewith) incurred, suffered
or sustained by that Indemnitee based upon, arising under or relating to
Environmental Laws based on, arising out of or relating to in whole or in part,
the existence or exercise of any rights or remedies by any Indemnitee under this
Agreement, any other
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Credit Document or any related documents (but excluding those incurred, suffered
or sustained by any Indemnitee as a result of any action taken by or on behalf
of the Lenders with respect to any Subsidiary of Borrower (or the assets
thereof) owned or controlled by the Lenders, the Agent, the Co-Agents, or their
nominees or designees.
If and to the extent that the obligations of Borrower under this Section 10.04
are unenforceable for any reason, Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under applicable law.
SECTION 10.05. WAIVER OF RIGHT OF SETOFF. The Agent and each
Lender hereby waives, with respect to the Obligations, any contractual or common
law right of setoff against any deposits of any Credit Party now or hereafter
held by and other indebtedness or property then or thereafter owing by such
Lender or other holder to any Credit Party.
SECTION 10.06. BENEFIT OF AGREEMENT.
(a) This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the respective successors and assigns of the
parties hereto, provided that Borrower may not assign or transfer any of its
interest hereunder without the prior written consent of the Lenders.
(b) Any Lender may make, carry or transfer Loans at, to
or for the account of, any of its branch offices or the office of an Affiliate
of such Lender.
(c) Each Lender may assign all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of any of its Commitments, Letter of Credit Obligations and the Loans at
the time owing to it and the Notes held by it) to any Eligible Assignee;
provided, however, that (i) the Agent and Borrower must give their prior written
consent to such assignment (which consent shall not be unreasonably withheld)
unless such assignment is to an Affiliate of the assigning Lender or, in the
case of Borrower, unless an Event of Default has occurred and is continuing,
(ii) the amount of the Commitments or Loans or Letter of Credit Obligations, of
the assigning Lender subject to each assignment (determined as of the date the
assignment and ac ceptance with respect to such assignment is delivered to the
Agent) shall not be less than $10,000,000 (or the total amount of such Lender's
Commitment), (iii) the parties to each such assignment shall execute and deliver
to the Agent an Assignment and Acceptance, together with a Note or Notes subject
to such assignment and, unless such assignment is to an Affiliate of such
Lender, a processing and recordation fee of $3,000, and (iv) any assignment of
the Commitments or Loans hereunder shall be made simultaneously with a pro rata
assignment of commitments and loans of such Lender pursuant to the Parent Credit
Agreement unless the Borrower and the Agent otherwise agree. Borrower shall not
be responsible for such processing and recordation fee or any costs or expenses
incurred by any Lender or the Agent in connection with such assignment. From
59
221
and after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, the assignee thereunder shall be a party hereto and to the extent of
the interest assigned by such Assignment and Acceptance, have the rights and
obligations of a Lender under this Agreement. Notwithstanding the foregoing, the
assigning Lender must retain after the consummation of such Assignment and
Acceptance, a minimum aggregate amount of Commitments, the Loans and the Letter
of Credit Obligations, as the case may be, of $10,000,000 (unless the Lender is
assigning its entire Commitment); provided, however, no such minimum amount
shall be required with respect to any such assignment made at any time there
exists an Event of Default hereunder. Within five (5) Business Days after
receipt of the notice and the Assignment and Acceptance, Borrower, at its own
expense, shall execute and deliver to the Agent, in exchange for the surrendered
Note or Notes, a new Note or Notes to the order of such assignee in a principal
amount equal to the applicable Commitments assumed by it pursuant to such
Assignment and Acceptance and new Note or Notes to the assigning Lender in the
amount of its retained Commitment or Commitments. Such new Note or Notes shall
be in an aggregate principal amount equal to the aggregate principal amount of
such surrendered Note or Notes, shall be dated the date of the surrendered Note
or Notes which they replace, and shall otherwise be in substantially the form
attached hereto.
(d) Each Lender may, without the consent of Borrower or
the Agent, sell participations to one or more banks or other entities in all or
a portion of its rights and/or obligations under this Agreement (including all
or a portion of its Commitments, the Letter of Credit Obligations and the Loans
owing to it and the Notes held by it), provided, however, that (i) no Lender may
sell a participation in its aggregate Commitments (after giving effect to any
permitted assignment hereof) in an amount in excess of fifty percent (50%) of
such aggregate Commitments, provided, however, sales of participations to an
Affiliate of such Lender shall not be included in such calculation; provided,
however, no such maximum amount shall be applicable to any such participation
sold at any time there exists an Event of Default hereunder, (ii) such Lender's
obligations under this Agreement shall remain unchanged, (iii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, and (iv) the participating bank or other entity shall not be
entitled to the benefit (except through its selling Lender) of the cost
protection provisions contained in Article III of this Agreement, and (v)
Borrower and the Agent and other Lenders shall continue to deal solely and
directly with each Lender in connection with such Lender's rights and
obligations under this Agreement and the other Credit Documents, and such Lender
shall retain the sole right to enforce the obligations of Borrower relating to
the Loans and to approve any amendment, modification or waiver of any provisions
of this Agreement. Any Lender selling a participation hereunder shall provide
prompt written notice to Borrower of the name of such participant.
(e) Any Lender or participant may, in connection with the
assignment or participation or proposed assignment or participation, pursuant to
this Section, disclose to the assignee or participant or proposed assignee or
participant any information relating to Borrower or the other Consolidated
Companies furnished to such Lender by or on behalf of Borrower or any other
Consolidated Company. With respect to any disclosure of confidential,
non-public, proprietary
60
222
information, such proposed assignee or participant shall agree to use the
information only for the purpose of making any necessary credit judgments with
respect to this credit facility and not to use the information in any manner
prohibited by any law, including without limitation, the securities laws of the
United States. The proposed participant or assignee shall agree not to disclose
any of such information except (i) to directors, employees, auditors or counsel
to whom it is necessary to show such information, each of whom shall be informed
of the confidential nature of the information, (ii) in any statement or
testimony pursuant to a subpoena or order by any court, governmental body or
other agency asserting jurisdiction over such entity, or as otherwise required
by law (provided prior notice is given to Borrower and the Agent unless
otherwise prohibited by the subpoena, order or law), and (iii) upon the request
or demand of any regulatory agency or authority with proper jurisdiction. The
proposed participant or assignee shall further agree to return all documents or
other written material and copies thereof received from any Lender, the Agent or
Borrower relating to such confidential information unless otherwise properly
disposed of by such entity.
(f) Any Lender may at any time assign all or any portion
of its rights in this Agreement and the Notes issued to it to a Federal Reserve
Bank; provided that no such assignment shall release the Lender from any of its
obligations hereunder.
(g) If (i) any Taxes referred to in Section 3.07(b) have
been levied or imposed so as to require withholdings or deductions by Borrower
and payment by Borrower of additional amounts to any Lender as a result thereof,
(ii) any Lender shall make demand for payment of increased costs or reduced rate
of return pursuant to Section 3.10 or any Lender determines that LIBOR is
unascertainable or illegal pursuant to Section 3.08 or Section 3.09, or any
Lender makes a claim for increased costs or determines that its participation in
any Letter of Credit is illegal pursuant to Section 3.09, or (iii) any Lender
shall decline to consent to a modification or waiver of the terms of this
Agreement or the other Credit Documents requested by Borrower, then and in such
event, upon request from Borrower delivered to such Lender and the Agent, such
Lender shall assign, in accordance with the provisions of Section 10.06(c), all
of its rights and obligations under this Agreement and the other Credit
Documents to another Lender or an Eligible Assignee selected by Borrower, in
consideration for the payment by such assignee to the Lender of the principal
of, and interest on, the outstanding Loans accrued to the date of such
assignment, and the assumption of such Lender's Commitment hereunder, together
with any and all other amounts owing to such Lender under any provisions of this
Agreement or the other Credit Documents accrued to the date of such assignment;
provided, however, Lenders subject to this Section 10.06 shall be treated in a
substantially identical manner.
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223
SECTION 10.07. GOVERNING LAW; SUBMISSION TO JURISDICTION;
WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER AND UNDER THE NOTES SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF) OF THE STATE OF GEORGIA.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT, THE NOTES OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE SUPERIOR
COURT OF XXXXXX COUNTY, GEORGIA, OR ANY OTHER COURT OF THE STATE OF GEORGIA OR
OF THE UNITED STATES OF AMERICA FOR THE NORTHERN DISTRICT OF GEORGIA, AND, BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, BORROWER HEREBY ACCEPTS FOR ITSELF AND
IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF
THE AFORESAID COURTS. THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE TRIAL BY JURY,
AND BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING, WITHOUT
LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF
FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.
(c) Nothing herein shall affect the right of the Agent,
any Co-Agent, any Lender, any holder of a Note or any Credit Party to commence
legal proceedings or otherwise proceed against Borrower in any other
jurisdiction.
SECTION 10.08. INDEPENDENT NATURE OF LENDERS' RIGHTS. The
amounts payable at any time hereunder to each Lender shall be a separate and
independent debt, and each Lender shall be entitled to protect and enforce its
rights pursuant to this Agreement and its Notes, and it shall not be necessary
for any other Lender to be joined as an additional party in any proceeding for
such purpose.
SECTION 10.09. COUNTERPARTS. This Agreement may be executed in
any number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which shall together constitute one and the same instrument.
SECTION 10.10. EFFECTIVENESS; SURVIVAL.
(a) This Agreement shall become effective on the date
(the "Effective Date") on which all of the parties hereto shall have signed a
copy hereof (whether the same or different copies) and shall have delivered the
same to the Agent pursuant to Section 10.01 or, in the case of the Lenders,
shall have given to the Agent written or telex notice (actually received) that
the same has been signed and mailed to them.
62
224
(b) The obligations of Borrower under Sections 3.07(b),
3.12, 3.10, 3.15 and 10.04 hereof shall survive the payment in full of the Notes
and all other Obligations after the Maturity Date. All representations and
warranties made herein, in the certificates, reports, notices, and other
documents delivered pursuant to this Agreement shall survive the execution and
delivery of this Agreement, the other Credit Documents, and such other
agreements and documents, the making of the Loans hereunder, and the execution
and delivery of the Notes.
SECTION 10.11. SEVERABILITY. In case any provision in or
obligation under this Agreement or the other Credit Documents shall be invalid,
illegal or unenforceable, in whole or in part, in any jurisdiction, the
validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby.
SECTION 10.12. INDEPENDENCE OF COVENANTS. All covenants
hereunder shall be given independent effect so that if a particular action or
condition is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or be otherwise within the limitation of, another
covenant, shall not avoid the occurrence of a Default or an Event of Default if
such action is taken or condition exists.
SECTION 10.13. CHANGE IN ACCOUNTING PRINCIPLES, FISCAL YEAR OR
TAX LAWS. If (i) any preparation of the financial statements referred to in
Section 6.09 of the Parent Credit Agreement hereafter occasioned by the
promulgation of rules, regulations, pronouncements and opinions by or required
by the Financial Accounting Standards Board or the American Institute of
Certified Public Accounts (or successors thereto or agencies with similar
functions) (other than changes mandated by FASB 106) result in a material change
in the method of calculation of financial covenants, standards or terms found in
this Agreement, (ii) there is any change in Borrower's fiscal quarter or fiscal
year, or (iii) there is a material change in federal tax laws which materially
affects any of the Consolidated Companies' ability to comply with the financial
covenants, standards or terms found in this Agreement, Borrower and the Required
Lenders agree to enter into negotiations in order to amend such provisions so as
to equitably reflect such changes with the desired result that the criteria for
evaluating any of the Consolidated Companies' financial condition shall be the
same after such changes as if such changes had not been made. Unless and until
such provisions have been so amended, the provisions of this Agreement shall
govern.
SECTION 10.14. HEADINGS DESCRIPTIVE; ENTIRE AGREEMENT. The
headings of the several sections and subsections of this Agreement are inserted
for convenience only and shall not in any way affect the meaning or construction
of any provision of this Agreement. This Agreement, the other Credit Documents,
and the agreements and documents required to be delivered pursuant to the terms
of this Agreement constitute the entire agreement among the parties hereto and
thereto
63
225
regarding the subject matters hereof and thereof and supersede all prior
agreements, representations and understandings related to such subject matters.
64
226
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and to be delivered in Atlanta, Georgia, by their duly authorized
officers as of the day and year first above written.
Address for Notices: HAVERTYS CREDIT SERVICES, INC.
000 Xxxx Xxxxxxxxx Xx., X.X. By: /s/ Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000 --------------------------------
Xxxxx Xxxxxx
President
Attn: President
----------------------
Attest: /s/ Xxxxxx X. Xxxxxx, Xx.
----------------------------
Telephone: 000-000-0000 Xxxxxx X. Xxxxxx, Xx.
----------------- Secretary
Telecopy: 000-000-0000
-----------------
[CORPORATE SEAL]
[SIGNATURE PAGE TO CREDIT AGREEMENT]
227
Address for Notices: SUNTRUST BANK, ATLANTA,
AS AGENT
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxx X. Xxxxx
Attention: Xxxxx X. Xxxxx --------------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxx X. Xxxxx
---------------------------
Title: AVP
--------------------------
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: XXXXXXX X. XXXXXX
---------------------------
Title: VICE PRESIDENT
--------------------------
Payment Office:
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[SIGNATURE PAGE TO CREDIT AGREEMENT]
228
Address for Notices: SUNTRUST BANK, ATLANTA
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxx X. Xxxxx
Attention: Xxxxx X. Xxxxx --------------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxx X. Xxxxx
---------------------------
Title: AVP
--------------------------
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: XXXXXXX X. XXXXXX
---------------------------
Title: VICE PRESIDENT
--------------------------
Lending Office:
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $15,000,000.00
PRO RATA SHARE OF
COMMITMENTS: 28.57%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
229
Address for Notices: FIRST UNION NATIONAL BANK,
INDIVIDUALLY AND AS CO-AGENT
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000 By: /s/ Xxxxxxxx Xxxxxx
Attention: Xxxxxxxx X. Xxxx ----------------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxxxxx Xxxxxx
-----------------------------
Title: Assistant Secretary
----------------------------
Corporate Bankship Officer
Lending Office:
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $12,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 23.81%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
230
Address for Notices: NATIONSBANK, N.A.,
INDIVIDUALLY AND AS CO-AGENT
NationsBank
NC1-007-08-04 By: /s/ E. Xxxxxxx Xxxxx
100 North Xxxxx Street, 8th Floor --------------------------------
Xxxxxxxxx, XX 00000 Name: Xxxx Xxxxx
Attention: Xxxx Xxxxxxx Xxxxx ---------------------------
Telecopy No.:________________ Title: V.P.
--------------------------
Lending Office:
NationsBank
NC1-007-08-04
000 Xxxxx Xxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxxxx, XX 00000
COMMITMENT: $12,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 23.81%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
231
Address for Notices: WACHOVIA BANK, N.A.
000 Xxxxxxxxx Xxxxxx, 00xx Floor By: /s/ Xxxxxxx X. Xxxxx
Xxxxxxx, Xxxxxxx 00000 --------------------------------
Attention: Xxxxxxx Xxxxx Name: Xxxxxxx X. Xxxxx
Telecopy No.: 000-000-0000 ---------------------------
Title: Vice President
--------------------------
Lending Office:
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
COMMITMENT: $7,500,000.00
PRO RATA SHARE OF
COMMITMENTS: 14.29%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
232
Address for Notices: THE BANK OF TOKYO-MITSUBISHI,
LTD., ATLANTA AGENCY
000 Xxxxxxxxx Xxxxxx, X.X. #0000
Xxxxxxx, Xxxxxxx 00000-0000 By: /s/ Xxxxxxx X. Xxxxxxxx
Attention: Xxxx Xxxxx --------------------------------
Telecopy No.: (000) 000-0000 Name: Xxxxxxx X. Xxxxxxxx
---------------------------
Title: Assistant Vice President
--------------------------
Lending Office:
000 Xxxxxxxxx Xxxxxx, X.X. #0000
Xxxxxxx, Xxxxxxx 00000-0000
COMMITMENT: $5,000,000.00
PRO RATA SHARE OF
COMMITMENTS: 9.52%
[SIGNATURE PAGE TO CREDIT AGREEMENT]
233
SCHEDULE 5.01(A) - LACK OF QUALIFICATION
None
234
SCHEDULE 5.01(b) - ORGANIZATION AND OWNERSHIP OF SUBSIDIARIES
State of
Company Incorporation Ownership
------- ------------- ---------
Havertys Credit Services, Inc. Tennessee 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
100% of Preferred Stock held by
Havertys Enterprises, Inc.
Havertys Capital, Inc. Nevada 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
Havertys Enterprises, Inc. Nevada 100% of Common Stock held by
Xxxxxxx Furniture Companies, Inc.
235
SCHEDULE 5.05 - CERTAIN PENDING AND THREATENED LITIGATION
None
236
SCHEDULE 5.08 - ENVIRONMENTAL MATTERS
None
237
SCHEDULE 5.11 - TAX FILINGS AND PAYMENTS
None
238
SCHEDULE 5.14 - EMPLOYEE BENEFIT MATTERS
(1) Identification of Plans.
Xxxxxxx Furniture Companies, Inc. Retirement Plan
(as Amended and Restated Effective January 1, 1989)
(2) Compliance.
None
(3) Liabilities.
None
(4) Funding.
None
239
SCHEDULE 5.15 - PATENT, TRADEMARK, LICENSE, AND OTHER INTELLECTUAL PROPERTY
MATTERS
None
240
SCEDULE 5.16 - OWNERSHIP OF PROPERTIES
None
241
SCHEDULE 5.19 - DIVIDEND RESTRICTIONS
The Corporation shall not declare any dividend on the Class A Common Stock,
except dividends payable solely in shares of common stock or other equity
securities of the Corporation, unless concurrently with such declaration and
payment there is paid on the Common Stock, on a share for share basis, a
dividend of at least 105% of the amount of the dividend declared and paid on the
Class A Common Stock.
242
EXHIBIT A
FORM OF
REVOLVING CREDIT NOTE
U.S. $________________ March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned HAVERTYS CREDIT SERVICES,
INC., a Maryland corporation (herein called "Borrower"), hereby promises to pay
to the order of _______________________________, a _____________________
(herein, together with any subsequent holder hereof, called the "Lender"), for
the account of its applicable Lending Office, on the Maturity Date the lesser of
(i) the principal sum of _____________________________________ AND NO/100 UNITED
STATES DOLLARS ($_______________) and (ii) the outstanding principal amount of
the Advances made by Lender to Borrower as Syndicated Loans pursuant to the
terms of the Credit Agreement referred to below. Borrower likewise promises to
pay interest on the outstanding principal amount of each such Advance, at such
interest rates, payable at such times, and computed in such manner, as are
specified for such Advance in the Credit Agreement in strict accordance with the
terms thereof.
The Lender shall record all Advances made as Syndicated Loans pursuant
to its Commitment under the Credit Agreement and all payments of principal of
such Advances and, prior to any transfer hereof, shall endorse such Advances and
payments on the schedule annexed hereto and made a part hereof, or on any
continuation thereof which shall be attached hereto and made a part hereof or on
the books and records of the Lender, which endorsement shall constitute prima
facie evidence of the accuracy of the information so endorsed; provided,
however, that delay or failure of the Lender to make any such endorsement or
recordation shall not affect the obligations of Borrower hereunder or under the
Credit Agreement with respect to the Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Revolving Credit Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement.
243
This Revolving Credit Note is issued pursuant to, and is one of the
Revolving Credit Notes referred to in, the Credit Agreement dated as of March
31, 1998 among Borrower, SunTrust Bank, Atlanta as Agent, First Union National
Bank and NationsBank, N.A., as Co-Agents, and the other lenders set forth on the
signature pages thereof (as the same may be further amended, modified or
supplemented from time to time, the "Credit Agreement") and each assignee
thereof becoming a "Lender" as provided therein, and the Lender is and shall be
entitled to all benefits thereof and all Security Documents executed and
delivered to the Lenders or the Agent in connection therewith. Terms defined in
the Credit Agreement are used herein with the same meanings. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and for mandatory
prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Advances in strict accordance with the terms thereof.
This Revolving Credit Note may be prepaid in whole or in part in
accordance with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Revolving Credit Note may
automatically become, or be declared, due and payable in the manner and with the
effect provided in the Credit Agreement. Borrower agrees to pay, and save the
Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Lender of any of its
rights under this Revolving Credit Note or the Credit Agreement.
This Revolving Credit Note has been executed and delivered in Georgia
and the rights and obligations of the Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Revolving Credit Note, now or hereafter required by
applicable law. TIME IS OF THE ESSENCE OF THIS REVOLVING CREDIT NOTE.
244
IN WITNESS WHEREOF, Borrower has caused this Revolving Credit Note to
be executed and delivered under seal by its duly authorized officers as of the
date first above written.
HAVERTYS CREDIT SERVICES, INC.
By:
----------------------------------------
Name:
Title:
Attest:
------------------------------------
Name:
Title:
[CORPORATE SEAL]
245
Revolving Credit Note (cont'd)
ADVANCES AND PAYMENTS OF PRINCIPAL
Last Day of
Amount of Applicable Notation
Amount of Interest Principal Interest Made
Date Advance Rate Prepaid Period By
--------------------------------------------------------------------------------
246
EXHIBIT B
FORM OF BID FACILITY NOTE
U.S. $_____________________ March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned HAVERTYS CREDIT SERVICES,
INC., a Maryland corporation (herein called "Borrower"), hereby promises to pay
to the order of _______________________________, a _____________________
(herein, together with any subsequent holder hereof, called the "Lender"), for
the account of its applicable Lending Office, on the Maturity Date the lesser of
(i) the principal sum of _____________________________ ($__________) and (ii)
the outstanding principal amount of the Bid Rate Advances made by Lender to
Borrower as Bid Rate Loans pursuant to the terms of the Credit Agreement
referred to below. Borrower likewise promises to pay interest on the outstanding
principal amount of each such Bid Rate Advance, at such interest rates, payable
at such times, and computed in such manner, as are specified for such Bid Rate
Advance in strict accordance with the terms of the Credit Agreement.
The Lender shall record all Bid Rate Advances made pursuant to the
Credit Agreement and all payments of principal of such Advances and, prior to
any transfer hereof, shall endorse such Advances and payments on the schedule
annexed hereto and made a part hereof, or on any continuation thereof which
shall be attached hereto and made a part hereof or on the books and records of
the Lender, which endorsement shall constitute prima facie evidence of the
accuracy of the information so endorsed; provided, however, that delay or
failure of the Lender to make any such endorsement or recordation shall not
affect the obligations of Borrower hereunder or under the Credit Agreement with
respect to the Bid Rate Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Bid Facility Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement.
This Bid Facility Note is issued pursuant to, and is one of the Bid
Facility Notes referred to in, the Credit Agreement dated as of March 31, 1998
among Borrower, SunTrust Bank, Atlanta as Agent, First Union National Bank and
NationsBank, N.A, as Co-Agents, and the other lenders set forth on the signature
pages thereof (as the same may be further amended,
247
modified or supplemented from time to time, the "Credit Agreement") and each
assignee thereof becoming a "Lender" as provided therein, and the Lender is and
shall be entitled to all benefits thereof and all Security Documents executed
and delivered to the Lenders or the Agent in connection therewith. Terms defined
in the Credit Agreement are used herein with the same meanings. The Credit
Agreement, among other things, contains provisions for acceleration of the
maturity hereof upon the happening of certain stated events and for mandatory
prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Bid Rate Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Bid Rate Advances in strict accordance with the terms
thereof.
This Bid Facility Note may be prepaid in whole or in part in accordance
with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Bid Facility Note may
automatically become, or be declared, due and payable in the manner and with the
effect provided in the Credit Agreement. Borrower agrees to pay, and save the
Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Lender of any of its
rights under this Bid Facility Note or the Credit Agreement.
This Bid Facility Note has been executed and delivered in Georgia and
the rights and obligations of the Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Bid Facility Note, now or hereafter required by applicable
law. TIME IS OF THE ESSENCE OF THIS BID FACILITY NOTE.
-2-
248
IN WITNESS WHEREOF, Borrower has caused this Bid Facility Note to be
executed and delivered under seal by its duly authorized officers as of the date
first above written.
HAVERTYS CREDIT SERVICES, INC.
By:
----------------------------------------
Name:
Title:
Attest:
------------------------------------
Name:
Title:
[CORPORATE SEAL]
-3-
249
Bid Facility Note (cont'd)
ADVANCES AND PAYMENTS OF PRINCIPAL
Last Day of
Amount of Applicable Notation
Amount of Interest Principal Interest Made
Date Advance Rate Prepaid Period By
--------------------------------------------------------------------------------
-4-
250
EXHIBIT C
FORM OF
SWING LINE NOTE
U.S. $5,000,000.00 March 31, 0000
Xxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, the undersigned HAVERTYS CREDIT SERVICES, INC.,
a Maryland corporation (the "Borrower") hereby promises to pay to the order of
SUNTRUST BANK, ATLANTA, a Georgia banking corporation (herein, together with any
subsequent holder hereof, the "Swing Line Lender") on the Maturity Date, an
amount equal to the lesser of (x) FIVE MILLION AND NO/100 DOLLARS
($5,000,000.00) or (y) so much thereof as may have been advanced by the Swing
Line Lender to the Borrower under the Swing Line Subcommitment established
pursuant to the terms of that certain Credit Agreement referred to below.
Borrower likewise promises to pay interest on the outstanding principal amount
of each such Swing Line Advance, at such interest rates, payable at such times,
and computed in such manner, as are specified for such Advance in the Credit
Agreement in strict accordance with the terms thereof.
The Swing Line Lender shall record all Swing Line Advances made
pursuant to its Swing Line Subcommitment under the Credit Agreement and all
payments of principal of such Advances and, prior to any transfer hereof, shall
endorse such Advances and payments on the schedule annexed hereto and made a
part hereof, or on any continuation thereof which shall be attached hereto and
made a part hereof or on the books and records of the Swing Line Lender, which
endorsement shall constitute prima facie evidence of the accuracy of the
information so endorsed; provided, however, that delay or failure of the Swing
Line Lender to make any such endorsement or recordation shall not affect the
obligations of Borrower hereunder or under the Credit Agreement with respect to
the Advances evidenced hereby.
Any principal or, to the extent not prohibited by applicable law,
interest due under this Swing Line Note that is not paid on the due date
therefor, whether on the Maturity Date, or resulting from the acceleration of
maturity upon the occurrence of an Event of Default, shall bear interest from
the date due to payment in full at the rate as provided in Section 3.03(d) of
the Credit Agreement.
All payments of principal and interest shall be made in lawful money of
the United States of America in immediately available funds at the Payment
Office of the Agent specified in the Credit Agreement unless otherwise directed
by the Agent or the Swing Line Lender.
This Swing Line Note is issued pursuant to, and is the Swing Line Note
referred to in, the Credit Agreement dated as of March 31, 1998 among Borrower,
SunTrust Bank, Atlanta as Agent, First Union National Bank and NationsBank,
N.A., as Co-Agents, and the other lenders set forth on the signature pages
thereof (as the same may be further amended, modified or supplemented from time
to time, the "Credit Agreement") and each assignee thereof becoming a "Lender"
as provided therein, and the Swing Line Lender is and shall be entitled to all
benefits thereof and all Security Documents executed and delivered to the
Lenders or the Agent in connection therewith. Terms
251
defined in the Credit Agreement are used herein with the same meanings. The
Credit Agreement, among other things, contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events and for
mandatory prepayments upon the occurrence of certain events.
Borrower agrees to make payments of principal on the Advances
outstanding hereunder on the dates and in the amounts specified in the Credit
Agreement for such Advances in strict accordance with the terms thereof.
This Swing Line Note may be prepaid in whole or in part in accordance
with the terms and conditions of the Credit Agreement.
In case an Event of Default shall occur and be continuing, the
principal of and all accrued interest on this Swing Line Note may automatically
become, or be declared, due and payable in the manner and with the effect
provided in the Credit Agreement. Borrower agrees to pay, and save the Swing
Line Lender harmless against any liability for the payment of, all reasonable
out-of-pocket costs and expenses, including reasonable attorneys' fees actually
incurred, arising in connection with the enforcement by the Swing Line Lender of
any of its rights under this Swing Line Note or the Credit Agreement.
This Swing Line Note has been executed and delivered in Georgia and the
rights and obligations of the Swing Line Lender and Borrower hereunder shall be
governed by and construed in accordance with the laws (without giving effect to
the conflict of law principles thereof) of the State of Georgia.
Borrower expressly waives any presentment, demand, protest or notice in
connection with this Swing Line Note, now or hereafter required by applicable
law. TIME IS OF THE ESSENCE OF THIS SWING LINE NOTE.
IN WITNESS WHEREOF, the Borrower has caused this Swing Line Note to be
executed under seal and delivered by its duly authorized officer as of the date
first above written.
HAVERTYS CREDIT SERVICES, INC.
By:
----------------------------------------
Name:
Title:
Attest:
------------------------------------
Name:
Title:
[Corporate Seal]
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SCHEDULE TO SWING LINE NOTE
Advances made under the Swing Line Subcommitment referred to in the
foregoing Swing Line Note.
Principal Maturity Interest Payments
Amount of Date of Rate of Made on Notation
Date Loan Loan Loan Loan Made By
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EXHIBIT D
FORM OF BID REQUEST LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below,
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, HAVERTYS CREDIT SERVICES, INC. (the "Borrower"),
refers to the Credit Agreement dated as of March 31, 1998 (as amended, modified,
extended or restated from time to time, the "Credit Agreement"), among the
Borrower, the financial institutions party thereto as Lenders, SunTrust Bank,
Atlanta, as Agent, and First Union National Bank and NationsBank, N.A., as
Co-Agents. Capitalized terms used herein and not otherwise defined herein shall
have the meanings assigned to such terms in the Credit Agreement. The Borrower
hereby gives you notice pursuant to Section 2.09(a) of the Credit Agreement that
it requests a Bid Rate Loan or Bid Rate Loans under the Credit Agreement, and in
that connection sets forth below the terms on which such Bid Rate Loan or Bid
Rate Loans is or are requested to be made:
(A) Date of Bid Rate Loan
(which is a Business Day) ______ ______
(B) Interest Period and the last
day thereof 1 ______ ______
(C) Principal Amount of
Bid Rate Loan 2 ______ ______
--------------------
1 Which shall be subject to the definition of "Interest Period" and end
not later than the Maturity Date.
2 Not less than $2,000,000 (and in integral multiples of $100,000) nor
greater than the lesser of (1) the amount by which $50,000,000 exceeds the
aggregate outstanding amount of Bid Rate Loans and (2) the amount by which
the sum of the Commitments exceeds the sum of the outstanding principal amount
of the Loans.
254
Upon acceptance of any or all of the Bid Rate Advances offered by the
Lenders in response to this request, the Borrower shall be deemed to have
represented and warranted that the conditions to lending specified in Section
4.02 of the Credit Agreement have been satisfied.
Very truly yours,
HAVERTYS CREDIT SERVICES, INC.
By:
-------------------------------
Title: [Responsible Officer]
255
EXHIBIT E
FORM OF BID REQUEST INVITE LETTER
[Name of Lender]
[Address]
[Date]
Ladies and Gentlemen:
Reference is made to the Credit Agreement dated as of March 31, 1998
(as it may be amended, modified, extended or restated from time to time, the
"Credit Agreement"), among HAVERTYS CREDIT SERVICES, INC. (the "Borrower"),
the financial institutions party thereto as Lenders, SUNTRUST BANK, ATLANTA, as
Agent, and FIRST UNION NATIONAL BANK and NATIONSBANK, N.A., as Co-Agents.
Capitalized terms used herein and not otherwise defined herein shall have the
meanings assigned to such terms in the Credit Agreement. The Borrower made a Bid
Rate Bid Request on __________ ___, 19__ , pursuant to Section 2.09(a) of the
Credit Agreement, and in that connection you are invited to submit a Bid Rate
Bid or Bid Rate Bids by [Date]/[Time].1 Each of your Bid Rate Bids must comply
with Section 2.09(b) of the Credit Agreement and the terms set forth below on
which the Bid Rate Bid Request was made:
(A) Date of Bid Rate Loan
(which is a Business Day) ______ ______
(B) Interest Period and the last
day thereof ______ ______
(C) Principal Amount of
Bid Rate Loan $_____ $_____
Very truly yours,
SUNTRUST BANK, ATLANTA, as
Agent
By:
----------------------------
Title:
----------------------
----------------------
1 Each Bid Rate Bid must be received by the Agent not later than 12:00
noon, Atlanta, Georgia time, on the Business Day of a proposed Bid Rate Loan.
256
EXHIBIT F
FORM OF BID RATE BID LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below,
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
[Date]
Attention:
Ladies and Gentlemen:
The undersigned, [Name of Lender], refers to the Credit Agreement dated
as of March 31, 1998 (as it may hereafter be amended, modified, extended or
restated from time to time, the "Credit Agreement"), among HAVERTYS CREDIT
SERVICES, INC. (the "Borrower"), the financial institutions party thereto as
Lenders, SunTrust Bank, Atlanta, as Agent, and FIRST UNION NATIONAL BANK and
NATIONSBANK, N.A., as Co-Agents. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement. The undersigned hereby makes a Bid Rate Bid or Bid Rate Bids, as the
case may be, pursuant to Section 2.09(b) of the Credit Agreement, in response to
the Bid Rate Bid Request made by the Borrower on __________ ___, 19___, and in
that connection sets forth below the terms on which such Bid Rate Bid or Bid
Rate Bids is or are made:
(A) Interest Period and last
day thereof ______ ______
(B) Principal Amount1 $_____ $_____
(C) Bid Rate ______ ______
[In the event bids are accepted for more than one Interest Period in
respect of which bids are set forth above, the aggregate principal amount of Bid
Rate Advances made pursuant to Bid Rate Bids submitted hereby shall not exceed
$_______ 2].
------------------------
1 Not less than $2,000,000 or greater than the requested Bid Rate Loan
and in integral multiples of $100,000. Multiple bids will be accepted by the
Agent not to exceed two.
2 Not less than $2,000,000 and in integral multiples of $100,000.
257
The undersigned hereby confirms that it is prepared, subject to the
conditions set forth in the Credit Agreement to extend credit to the Borrower
upon acceptance by the Borrower of this bid in accordance with Section 2.09(d)
of the Credit Agreement.
Very truly yours,
[NAME OF LENDER]
By:
---------------------------------
Title:
--------------------------
258
EXHIBIT G
FORM OF BID ACCEPT/REJECT LETTER
SunTrust Bank, Atlanta, as Agent
for the Lenders referred to below
00 Xxxx Xxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention:
Ladies and Gentlemen:
The undersigned, HAVERTYS CREDIT SERVICES, INC. (the "Borrower"),
refers to the Credit Agreement dated as of March 31, 1998 (as it may hereafter
be amended, modified, extended or restated from time to time, the "Credit
Agreement"), among the Borrower, the financial institutions party thereto as
Lenders, SunTrust Bank, Atlanta, as Agent, and First Union National Bank and
NationsBank, N.A., as Co-Agents. Capitalized terms used herein and not otherwise
defined herein shall have the meanings assigned to such terms in the Credit
Agreement.
In accordance with Section 2.09(c) of the Credit Agreement, we have
received a summary of bids in connection with our Bid Rate Bid Request dated
_______ ___, 19__ and in accordance with Section 2.09(d) of the Credit
Agreement, we hereby accept the following bids for the Interest Periods
specified below:
1. Interest Period commencing [date] and ending [date]
Aggregate Principal Amount of Bids Accepted, if in Excess of
Aggregate Amount Requested in Bid Rate Bid Request, is $_______.1
Accepted Bids:
Principal Amount Interest Rate Lender
$ --%
$ --%
----------------------
1 Must be prorated amongst Lenders as provided in Section 2.09(d).
259
[2. Interest Period commencing [date] and ending [date]
Aggregate Principal Amount of Bids Accepted, if in Excess of Aggregate
Amount Requested in Bid Rate Bid Request, is $_________.2
Accepted Bids:
Principal Amount Interest Rate Lender
$ --%
$ --%
]
All Bid Rate Bids received but not listed above as accepted are hereby
deemed rejected.
[Insert special instructions, if any, with respect to the apportionment
of the Borrower's acceptance among bids by a Lender for different Interest
Periods]
Very truly yours,
HAVERTYS CREDIT SERVICES, INC.
By:
------------------------------
Name:
Title:
------------------------
2 Must be prorated amongst Lenders as provided in Section 2.09(d).
260
EXHIBIT H
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of March 31, 1998, made by HAVERTYS
CREDIT SERVICES, INC. a Maryland corporation with an office at 000 Xxxx
Xxxxxxxxx Xxxxxx, X.X. Xxxxxxx, Xxxxxxx 00000-0000 (the "Guarantor") in favor of
(i) SUNTRUST BANK, ATLANTA, a Georgia banking corporation (the "Agent"), in its
capacity as agent for banks and other lending institutions parties to the Credit
Agreement (as hereinafter defined) and each assignee thereof becoming a "Lender"
as provided therein (the "Lenders"), (ii) the Lenders and (iii) First Union
National Bank and NationsBank, N.A., in their capacities as co-agents for the
Lenders (the "Co-Agents"; the Lenders, the Agent and the Co-Agents being
collectively referred to herein as the "Guaranteed Parties").
PRELIMINARY STATEMENT. The Guaranteed Parties have entered into a
Credit Agreement dated as of the date hereof (said Agreement, as it may be
amended, supplemented, amended and restated, or otherwise modified from time to
time hereafter in accordance with the provisions thereof, being the "Credit
Agreement"), with Havertys Credit Services, Inc., a Tennessee corporation (the
"Borrower"). The Guarantor will benefit from the financial accommodations made
available to the Borrower. It is a condition precedent to the making of loans by
the Lenders under the Credit Agreement that the Guarantor shall have executed
and delivered this Guaranty.
NOW, THEREFORE, in consideration of the premises and in order to induce
the Agent, the Co-Agents and the Lenders to consummate the transactions
contemplated by the Credit Agreement, the Guarantor hereby agrees as follows:
SECTION 1. Guaranty. The Guarantor hereby unconditionally guarantees
the punctual payment when due, whether at stated maturity, by acceleration or
otherwise, of all Obligations of the Borrower now or hereafter existing under
the Credit Agreement, the promissory notes executed in connection with the
Credit Agreement (the "Notes") and each of the other the Credit Documents
executed in connection therewith, whether for principal, interest, fees,
expenses (including counsel fees and expenses) actually incurred by the Agent or
Lenders in enforcing any rights under this Guaranty or otherwise (such
obligations being, collectively, the "Guaranteed Obligations"), including
without limitation, all interest which, but for the filing of a petition in
bankruptcy with respect to the Borrower, would accrue on any principal portion
of the Guaranteed Obligations. The Guarantor acknowledges and agrees that this
is a guarantee of payment when due, and not of collection, and that this
Guaranty may be enforced up to the full amount of the Guaranteed Obligations
without proceeding against Borrower, against any security for the Guaranteed
Obligations, or under any other guaranty covering any portion of the Guaranteed
Obligations.
SECTION 2. Guaranty Absolute. The Guarantor guarantees that the
Guaranteed Obligations will be paid strictly in accordance with the terms of the
Credit Agreement, the Notes and the Credit Documents, regardless of any law,
regulation or order now or hereafter in effect in any jurisdiction affecting any
of such terms or the rights of any Guaranteed Party with respect thereto.
261
The liability of Guarantor under this Guaranty shall be absolute and
unconditional in accordance with its terms and shall remain in full force and
effect without regard to, and shall not be released, suspended, discharged,
terminated or otherwise affected by, any circumstance or occurrence whatsoever,
including, without limitation, the following (whether or not Guarantor consents
thereto or has notice thereof):
1. any change in the time, place or manner of payment of, or in
any other term of, all or any of the Guaranteed Obligations,
any waiver, indulgence, renewal, extension, amendment or
modification of or addition, consent or supplement to or
deletion from or any other action or inaction under or in
respect of the Credit Agreement, the other Credit Documents,
or any other documents, instruments or agreements relating to
the Guaranteed Obligations or any other instrument or
agreement referred to therein or any assignment or transfer of
any thereof;
2. any lack of validity or enforceability of the Credit
Agreement, the other Credit Documents, or any other document,
instrument or agreement referred to therein or any assignment
or transfer of any thereof;
3. any furnishing to the Guaranteed Parties of any additional
security for the Guaranteed Obligations, or any sale,
exchange, release or surrender of, or realization on, any
security for the Guaranteed Obligations;
4. any settlement or compromise of any of the Guaranteed
Obligations, any security therefor, or any liability of any
other party with respect to the Guaranteed Obligations, or any
subordination of the payment of the Guaranteed Obligations to
the payment of any other liability of Borrower;
5. any bankruptcy, insolvency, reorganization, composition,
adjustment, dissolution, liquidation or other like proceeding
relating to Guarantor or Borrower, or any action taken with
respect to this Guaranty by any trustee or receiver, or by any
court, in any such proceeding;
6. any nonperfection of any security interest or lien on any
collateral, or any amendment or waiver of or consent to
departure from any guaranty or security, for all or any of the
Guaranteed Obligations;
7. any application of sums paid by Borrower or any other Person
with respect to the liabilities of Borrower to the Guaranteed
Parties, regardless of what liabilities of Borrower remain
unpaid;
8. any act or failure to act by any Guaranteed Party which may
adversely affect Guarantor's subrogation rights, if any,
against Borrower to recover payments made under this Guaranty;
and
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9. any other circumstance which might otherwise constitute a
defense available to, or a discharge of, Guarantor.
If claim is ever made upon any Guaranteed Party for repayment or recovery of any
amount or amounts received in payment or on account of any of the Guaranteed
Obligations, and any Guaranteed Party repays all or part of said amount by
reason of (a) any judgment, decree or order of any court or administrative body
having jurisdiction over the Guaranteed Party or any of its property, or (b) any
settlement or compromise of any such claim effected by the Guaranteed Party with
any such claimant (including Borrower or a trustee in bankruptcy for Borrower),
then and in such event the Guarantor agrees that any such judgment, decree,
order, settlement or compromise shall be binding on it, notwithstanding any
revocation hereof or the cancellation of the Credit Agreement, the other Credit
Documents, or any other instrument evidencing any liability of Borrower, and the
Guarantor shall be and remain liable to the Guaranteed Party for the amounts so
repaid or recovered to the same extent as if such amount had never originally
been paid to the Guaranteed Party.
SECTION 3. Waiver. The Guarantor hereby waives promptness, diligence,
notice of acceptance and any other notice with respect to any of the Guaranteed
Obligations and this Guaranty and all demands whatsoever, and covenants that
this Guaranty will not be discharged, except by complete performance of the
obligations contained herein. The Guarantor hereby waives any requirement that
any Guaranteed Party protect, secure, perfect or insure any security interest or
lien on any property subject thereto or exhaust any right or take any action
against the Borrower or any other person or entity regarding any collateral.
SECTION 4. No Subrogation; Etc. Unless and until the Guaranteed
Obligations have been paid in full, the Guarantor shall have no rights against
the Borrower with respect to this Guaranty and shall have no right of
subrogation and hereby waives any right to enforce any remedy which any
Guaranteed Party now has or may hereafter have against the Borrower, any
endorser or any other guarantor of all or any part of the Guaranteed
Obligations, and the Guarantor hereby waives any benefit of, and any right to
participate in, any security or collateral given to any Guaranteed Party to
secure payment of the Guaranteed Obligations or any other liability of the
Borrower to any Guaranteed Party. The Guarantor also waives all setoffs and
counterclaims and all presentments, demands for performance, notices of
nonperformance, protests, notices of protest, notices of dishonor, and notices
of acceptance of this Guaranty. The Guarantor further waives all notices of the
existence, creation or incurring of new or additional indebtedness, arising
either from additional loans extended to the Borrower or otherwise, and also
waives all notices that the principal amount, or any portion thereof, and/or any
interest on any instrument or document evidencing all or any part of the
Guaranteed Obligations is due, notices of any and all proceedings to collect
from the maker, any endorser or any other guarantor of all or any part of the
Guaranteed Obligations, or from anyone else, and, to the extent permitted by
law, notices of exchange, sale, surrender or other handling of any security or
other collateral given to any Guaranteed Party to secure payment of the
Guaranteed Obligations.
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SECTION 5. Authorization. The Agent and each Lender are hereby
authorized, without notice or demand and without affecting the liability of the
Guarantor hereunder, from time to time, to (i) renew, extend, accelerate or
otherwise change the time for payment of, or other terms relating to, the
Guaranteed Obligations, or otherwise modify, amend or change the terms of the
Notes, any other promissory note or other agreement, document or instrument now
or hereafter executed by the Borrower and delivered to the Agent or such Lender;
(ii) accept partial payments on the Guaranteed Obligations; (iii) take and hold
security or collateral for the payment of this Guaranty, any other guarantees of
the Guaranteed Obligations or other liabilities of the Borrower and the
Guaranteed Obligations guaranteed hereby or thereby, and exchange, enforce,
waive and release any such security or collateral; (iv) apply such security or
collateral and direct the order or manner of sale thereof as in its discretion
it may determine; and (v) settle, release, compromise, collect or otherwise
liquidate the Guaranteed Obligations and any security or collateral therefor in
any manner, without affecting or impairing the obligations of the Guarantor
hereunder.
SECTION 6. Representations and Warranties. The Guarantor hereby
represents and warrants that all of the representations and warranties set forth
in Article V of the Parent Credit Agreement, which representations and
warranties are, for the benefit of the Agent and the Lenders, incorporated by
reference herein (including the definition of terms used therein which appear in
other provisions of the Parent Credit Agreement and the schedules attached
thereto), irrespective of any termination, modification or amendment or consent
or waiver to the Parent Credit Agreement occurring after the date hereof, are
true and correct on and as of the date hereof as well as on the date of (and
after giving effect to) the making of the Loans; provided that (i) all
references to the "Agent" and the "Lenders" shall be deemed to mean the Agent
and the Lenders, (ii) all references to "this Agreement" and any "Note" or
"Notes" or the "Credit Documents" shall be deemed to refer to this Guaranty, the
Credit Agreement, the Notes and the Credit Documents and the reference to
"Loans" shall be deemed to refer to the Loans, and (iii) the words "hereunder"
and "hereby" and the like shall be deemed to refer to this Guaranty.
SECTION 7. Affirmative and Negative Covenants. The Guarantor covenants
and agrees that, so long as any Note shall remain unpaid or any of the
Guaranteed Obligations shall be outstanding, it will comply with each of the
covenants set forth in Articles VI and VII of the Parent Credit Agreement, which
covenants are, for the benefit of the Agent and the Lenders, incorporated by
reference herein (including the definition of the terms used therein which
appear in other provisions of the Parent Credit Agreement and the schedules
thereto), irrespective of any termination, modification, amendment, consent or
waiver relating to such covenants or the termination of the Parent Credit
Agreement occurring after the date hereof; provided that, any amendment,
modification, consent or waiver with respect to the foregoing provisions of the
Parent Credit Agreement occurring when SunTrust Bank, Atlanta is the Agent and a
Lender thereunder shall be deemed to be automatically incorporated herein and
further provided that, (i) all references to the "Agent" and the "Lenders" shall
be deemed to mean the Agent and the Lenders, (ii) all references to "this
Agreement" and any "Note" or "Notes" or the "Loans" or the "Credit Documents"
shall be deemed to refer to this Guaranty, the Credit Agreement, the Notes, the
Loans and the Credit Documents (iii) the words "hereunder" and "hereby" and the
like shall be deemed to refer to this
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264
Guaranty, and (iv) the terms "Default" and "Event of Default" shall be deemed to
have the meanings set forth in the Credit Agreement.
SECTION 8. Events of Default. The occurrence of any one or more of the
following events shall constitute an event of default under the provisions of
this Guaranty (each, an "Event of Default"):
(a) the Guarantor shall fail to pay within five (5) days
after written request from any Guaranteed Party, any amount payable under this
Guaranty;
(b) the Guarantor shall fail to observe or perform any
agreement contained in this Guaranty (or incorporated herein); provided that,
with respect to any covenant incorporated herein, any applicable grace period
applicable to such covenant in the Parent Credit Agreement shall have expired;
(c) Any representation, warranty or statement made or deemed
to be made by Guarantor or by any of its officers under this Guaranty or any
other Credit Document (including the Schedules attached thereto), or any
certificate or other document submitted to the Guaranteed Parties by any such
Person pursuant to the terms of this Guaranty or any other Credit Document,
shall be incorrect in any material respect when made or deemed to be made or
submitted;
(d) The Guarantor or any of its Subsidiaries shall fail to
make when due (whether at stated maturity, by acceleration, on demand or
otherwise, and after giving effect to any applicable grace period) any payment
of principal of or interest on any Debt (other than the Guaranteed Obligations)
exceeding $5,000,000 in the aggregate, including without limitation, the Parent
Credit Agreement;
(e) The Guarantor or any of its Subsidiaries shall fail to
observe or perform within any applicable grace period any covenants or
agreements contained in any agreements or instruments relating to any of its
Debt exceeding $5,000,000 in the aggregate, or any other event shall occur if
the effect of such failure or other event is to accelerate, or to permit the
holder of such Debt or any other Person to accelerate, the maturity of such
Debt; or any such Debt shall be required to be prepaid (other than by a
regularly scheduled required prepayment) in whole or in part prior to its stated
maturity;
(f) The Guarantor or any of its Subsidiaries shall commence
a voluntary case concerning itself under the Bankruptcy Code or applicable
foreign bankruptcy laws; or an involuntary case for bankruptcy is commenced
against Guarantor or any of its Subsidiaries and the petition is not
controverted within 10 days, or is not dismissed within 60 days, after
commencement of the case; or a custodian (as defined in the Bankruptcy Code) or
similar official under applicable foreign bankruptcy laws is appointed for, or
takes charge of, all or any substantial part of the property of the Guarantor or
any of its Subsidiaries; or the Guarantor or any of its Subsidiaries com mences
proceedings of its own bankruptcy or to be granted a suspension of payments or
any other
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265
proceeding under any reorganization, arrangement, adjustment of debt, relief of
debtors, dissolution, insolvency or liquidation or similar law of any
jurisdiction, whether now or hereafter in effect, relating to the Guarantor or
any of its Subsidiaries or there is commenced against the Guarantor or any of
its Subsidiaries any such proceeding which remains undismissed for a period of
60 days; or the Guarantor or any of its Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or the Guarantor or any of its Subsidiaries suffers any
appointment of any custodian or the like for it or any substantial part of its
property to continue undischarged or unstayed for a period of 60 days; or the
Guarantor or any of its Subsidiaries makes a general assignment for the benefit
of creditors; or the Guarantor or any of its Subsidiaries shall fail to pay, or
shall state that it is unable to pay, or shall be unable to pay, its debts
generally as they become due; or the Guarantor or any of its Subsidiaries shall
call a meeting of its creditors with a view to arranging a composition or
adjustment of its debts; or the Guarantor or any of its Subsidiaries shall by
any act or failure to act indicate its consent to, approval of or acquiescence
in any of the foregoing; or any corporate action is taken by the Guarantor or
any of its Subsidiaries for the purpose of effecting any of the foregoing;
(g) A Plan of the Guarantor or any of its Subsidiaries or
a Plan subject to Title IV of ERISA of any of its ERISA Affiliates:
(1) shall fail to be funded in accordance with the
minimum funding standard required by applicable law,
the terms of such Plan, Section 412 of the Tax Code
or Section 302 of ERISA for any plan year or a waiver
of such standard is sought or granted with respect to
such Plan under applicable law, the terms of such
Plan or Section 412 of the Tax Code or Section 303 of
ERISA; or
(2) is being, or has been, terminated or the subject
of termination proceedings under applicable law or
the terms of such Plan; or
(3) shall require the Guarantor or any of its
Subsidiaries to provide security under applicable
law, the terms of such Plan, Section 401 or 412 of
the Tax Code or Section 306 or 307 of ERISA; or
(4) results for any reason, in a liability (including
without limitation, withdrawal liability) to the
Guarantor or any of its Subsidiaries under applicable
law, the terms of such Plan, or Title IV of ERISA;
and there shall result from any such failure, waiver, termination or other event
a liability to the PBGC, a Plan or any other Person that would have a Materially
Adverse Effect;
(h) A judgment or order for the payment of money in
excess of $5,000,000 or otherwise having a Materially Adverse Effect shall be
rendered against the Guarantor or any of its Subsidiaries and such judgment or
order shall continue unsatisfied (in the case of a money judgment)
6
266
and in effect for a period of 30 days during which execution shall not be
effectively stayed or deferred (whether by action of a court, by agreement or
otherwise);
(i) Guarantor shall merge, consolidate or exchange shares
with any other Person where such merger, consolidation or exchange results in
(i) any Person other than a Class A Shareholder as of the Closing Date or two or
more Persons (unless all such Persons are Class A Shareholders as of the Closing
Date) acting in concert acquiring beneficial ownership (within the meaning of
Rule 13d-3 of the Securities and Exchange Commission under the Securities
Exchange Act of 1934) of fifty percent (50%) or more of the outstanding shares
of the Class A common stock of Guarantor, excluding any sales, transfers or
gifts to spouses or direct descendants of Class A Shareholders as of the date of
this Agreement; (ii) a majority of the Board of Directors of Guarantor
consisting of individuals who were not either (A) directors of Guarantor as of
the corresponding date of the previous year, (B) selected or nominated to become
directors by the Board of Directors of Guarantors of which a majority consisted
of individuals described in clause (A) above, or (C) selected or nominated to
become directors by the Board of Directors of Guarantor of which a majority
consisted of individuals described in clause (A) above and individuals described
in clause (B) above; or (iii) the dissolution of Guarantor; or
(j) An attachment or similar action shall be made on or
taken against any of the assets of the Guarantor or any of its Subsidiaries with
a book value exceeding $5,000,000 in aggregate and is not removed, suspended or
enjoined within 30 days of the same being made or any suspension or injunction
being lifted;
then, an amount equal to the Guaranteed Obligations then outstanding (whether
matured or unmatured and regardless of whether such amount is then due and
payable by the Borrower) shall immediately and automatically be due and payable
by the Guarantor without any further action on the part of the Guaranteed
Parties, and the Guaranteed Parties may exercise any rights or remedies
available by agreement, at law or in equity. Without limitation of the
foregoing, upon the occurrence of an Event of Default specified in Section 8.07
of the Credit Agreement, all Guaranteed Obligations shall automatically become
immediately due and payable by the Guarantor, without notice or other action on
the part of the Agent or other Guaranteed Parties, and regardless of whether
payment of the Guaranteed Obligations by Borrower has then been accelerated.
SECTION 9. Waivers, Amendments, Etc. The provisions of this Guaranty
may from time to time be amended, modified, or waived, if such amendment,
modification or waiver is in writing and consented to by the Guarantor and the
Agent. No failure or delay on the part of the Agent, any Lender or the holder of
any Note in exercising any power or right under this Guaranty, the Credit
Agreement or any other Credit Document shall operate as a waiver thereof, nor
shall any single or partial exercise of any such power or right preclude any
other or further exercise thereof or the exercise of any other power or right.
No notice to or demand on the Guarantor in any case shall entitle it to any
notice or demand in similar or other circumstances, unless otherwise required by
the Credit Documents. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law. No waiver or approval by the Agent or
the holder of any Note under this Guaranty,
7
267
the Credit Agreement or any other Credit Document shall, except as may be
otherwise stated in such waiver or approval, be applicable to subsequent
transactions. No waiver or approval hereunder shall require any similar or
dissimilar waiver or approval thereafter to be granted hereunder.
SECTION 10. Notices. All notices and other communications provided to
any party hereto under this Guaranty shall be in writing or by facsimile
transmission and addressed or delivered to it at its address designated for
notices set forth below its signature hereto or at such other address as may be
designated by such party in a notice to the other parties. Any notice, if mailed
and properly addressed with postage prepaid, shall be deemed given when
received; any notice, if transmitted by facsimile transmission or delivery,
shall be deemed given when received.
SECTION 11. Further Assurances. The Guarantor hereby agrees that it
will, from time to time at its own expense, promptly execute and deliver all
further instruments, and take all further action, that may be necessary or
appropriate, or that the Agent may reasonably request, in order to perfect or
protect any Lien granted under the Security Documents, to enable the Agent to
exercise and enforce its rights under this Guaranty, the Credit Agreement and
the other Credit Documents and otherwise to carry out the intent of this
Guaranty, the Credit Agreement and the other Credit Documents.
SECTION 12. Equitable Relief. The Guarantor recognizes that, in the
event the Guarantor fails to perform, observe or discharge any of its
obligations or liabilities under this Guaranty, any remedy of law may prove to
be inadequate relief to the Agent; therefore, the Guarantor agrees that the
Agent, if the Agent so requests, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving actual
damages.
SECTION 13. Continuing Guaranty; Transfer of Note. This Guaranty is a
continuing guaranty and shall (a) remain in full force and effect until (i)
payment in full of all amounts due under the Notes, and (ii) payment in full of
the Guaranteed Obligations and all other amounts payable under this Guaranty,
(b) be binding upon the Guarantor, its successors and assigns, and (c) inure to
the benefit of and be enforceable by the Lenders, the Agent and their respective
successors, transferees and assigns. Without limiting the generality of the
foregoing clause (c) but subject to the terms of the Credit Agreement, any
Lender may assign or otherwise transfer any Note held by it to any other Person
or entity, which such Person or entity shall thereupon become vested with all
the rights in respect thereof granted to such Lender herein or otherwise.
SECTION 14. Definitions. Any defined term used herein and not defined
herein shall have the meaning ascribed such term in the Credit Agreement, and in
the event the Credit Agreement is for any reason terminated and is no longer of
any force and effect, such terms shall have the meaning set forth in the Credit
Agreement immediately prior to such termination.
8
268
SECTION 15. GOVERNING LAW; SUBMISSION TO JURISDICTION.
(a) THIS GUARANTOR AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE
LAW (WITHOUT GIVING EFFECT TO THE CONFLICT OF
LAW PRINCIPLES THEREOF) OF THE STATE OF GEORGIA.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
GUARANTY OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE SUPERIOR COURT OF
XXXXXX COUNTY, GEORGIA, OR ANY OTHER COURT OF THE STATE OF GEORGIA OR OF THE
UNITED STATES OF AMERICA FOR THE NORTHERN DISTRICT OF GEORGIA, AND, BY EXECUTION
AND DELIVERY OF THIS AGREEMENT, THE GUARANTOR HEREBY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURIS DICTION OF THE
AFORESAID COURTS. THE GUARANTOR HEREBY IR REVOCABLY WAIVES ANY OBJECTION,
INCLUDING, WITHOUT LIMITATION, ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON
THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY SUCH ACTION OR PROCEEDING IN SUCH RESPECTIVE JURISDICTIONS.
(c) THE GUARANTOR FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE GUARANTOR AT ITS SAID ADDRESS, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING.
(d) Nothing herein shall affect the right of the Guaranteed
Parties or any holder of a Note to commence legal proceedings or otherwise
proceed against the Guarantor in any other jurisdiction.
SECTION 16. Successors and Assigns. This Guaranty shall be binding upon
and inure to the benefit of the parties hereto and their respective successors
and assigns; provided, however, that the Guarantor may not assign or transfer
its rights or obligations hereunder without the prior written consent of the
Agent.
SECTION 17. Waiver of Jury Trial. TO THE EXTENT PERMITTED BY LAW, THE
GUARANTOR HEREBY WAIVES THE RIGHT TO TRIAL BY JURY.
9
269
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly
executed and delivered by its officers thereunto duly authorized as of the date
first above written.
XXXXXXX FURNITURE COMPANIES, INC.
By:
-------------------------------
Xxxxxx X. Xxxx
Executive Vice President
Address:
000 Xxxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Attest:
------------------------------
Xxxxx Xxxx Xxxxxx
Secretary
[CORPORATE SEAL]
ACCEPTED:
SUNTRUST BANK, ATLANTA, as Agent
By:
----------------------------------
Title:
----------------------------
By:
----------------------------------
Title:
----------------------------
[CORPORATE SEAL]
[SIGNATURE PAGE TO GUARANTY AGREEMENT]
270
EXHIBIT I
FORM OF CLOSING CERTIFICATE
CLOSING CERTIFICATE
Pursuant to Section 4.01 of the Credit Agreement dated as of March 31,
1998 (the "Credit Agreement") among HAVERTYS CREDIT SERVICES, INC., a Tennessee
corporation ("Haverty"), SUNTRUST BANK, ATLANTA, a Georgia banking corporation,
as Agent, First Union National Bank and NationsBank, N.A., as Co-Agents, and the
other banks and lending institutions listed on the signature pages thereto, the
undersigned in their respective capacities as officers, directors, or authorized
signatories of Haverty hereby certify to the Lenders, the Agent and the
Co-Agents as follows (capitalized terms used herein having the same meanings as
assigned to such terms in the Credit Agreement):
1. All representations and warranties contained in the Credit Agreement are true
and correct in all material respects on and as of the date hereof.
2. After giving effect to the Loans to be made or deemed to be made to Haverty
pursuant to the Credit Agreement on the date hereof, no Default or Event of
Default has occurred and is continuing.
3. Since the date of the audited financial statements of the Consolidated
Companies described in Section 5.13 of the Credit Agreement, there has been no
change which has had or could reasonably be expected to have a Materially
Adverse Effect.
4. Except as may be described on Schedule 5.05 of the Credit Agreement, no
action or proceeding has been instituted or is pending before any court or other
governmental authority, or, to the knowledge of Haverty, threatened (i) which
reasonably could be expected to have a Materially Adverse Effect, or (ii)
seeking to prohibit or restrict one or more Credit Party's ownership or
operation of any portion of its businesses or assets, where such portion or
portions of such businesses or assets, as the case may be, constitute a material
portion of the total businesses or assets of the Consolidated Companies.
5. The Loans to be made on the date hereof are being used solely for the
purposes provided in the Credit Agreement, and such Loans and use of proceeds
thereof will not contravene, violate or conflict with, or involve the Agent or
any Lender in a violation of, any law, rule, injunction, or regulation, or
determination of any court of law or other governmental authority, applicable to
Haverty.
6. The conditions precedent set forth in Sections 4.01 and 4.02 of the Credit
Agreement have been or will be satisfied (or have been waived pursuant to the
terms of the Credit Agreement) prior to or concurrently with the making of the
Loans under the Credit Agreement on the date hereof.
271
7. The execution, delivery and performance by the Credit Parties of the Credit
Documents will not violate any Requirement of Law or cause a breach or default
under any of their respective Contractual Obligations.
8. Each of the Credit Parties has the corporate power and authority to make,
deliver and perform the Credit Documents to which it is a party and has taken
all necessary corporate action to authorize the execution, delivery and
performance of such Credit Documents. No consents or authorization of, or filing
with, any Person (including, without limitation, any governmental authority), is
required in connection with the execution, delivery or performance by any Credit
Party, or the validity or enforceability against any Credit Party, of the Credit
Documents, other than such consents, authorizations or filings which have been
made or obtained.
This Certificate executed and delivered on behalf of Haverty this 31st
day of March, 1998.
-----------------------------------
Xxxxx X. Xxxxxx
President
272
EXHIBIT J
, 1998
-----------
SunTrust Bank, Atlanta, As Agent
00 Xxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
First Union National Bank, As Co-Agent
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
NationsBank, N.A., As Co-Agent
Corporate Finance
NationsBank Plaza
000 Xxxxxxxxx Xxxxxx, XX, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
And the Lenders from time to time party to
The Credit Agreement hereafter described
Re: Credit Agreement dated as of ___________________________,
1998, among Havertys Credit Services, Inc., each of the
Lenders listed on the signature pages thereto, SunTrust Bank,
Atlanta, as Agent and ___________ and _________________ as
Co-Agents (the "Credit Agreement")
Ladies and Gentlemen:
We have acted as counsel to Havertys Credit Services, Inc., a Tennessee
corporation (the "Borrower"), and Xxxxxxx Furniture Companies, Inc., a Maryland
corporation (the "Guarantor"), in connection with the execution and delivery of
the Credit Agreement. This opinion is furnished pursuant to Section 4.01(j) of
the Credit Agreement. Unless otherwise defined herein, terms used herein shall
have the meanings ascribed to them in the Credit Agreement.
In connection with giving the opinions set forth herein, we have
examined originals or documents certified, or otherwise identified to our
satisfaction, as copies of the originals of the following documents:
1. The Credit Agreement;
2. The Revolving Notes;
000
XxxXxxxx Xxxx, Xxxxxxx, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
__________, 1998
Page 2
3. The Bid Facility Notes;
4. The Swing Line Note;
5. The Guaranty Agreement (the "Guaranty" and collectively, with
the Credit Agreement and the Revolving Notes, the Bid Facility
Notes and the Swing Line Note, the "Transaction Documents");
6. The respective Articles of Incorporation and Bylaws of each of
the Borrower and Guarantor and all amendments to such Articles
of Incorporation and Bylaws;
7. The respective corporate minute books of each of the Borrower
and Guarantor certified to us as complete and correct;
8. Corporate proceedings of each of the Borrower and Guarantor
relating to the execution and delivery of the Transaction
Documents;
9. Certificate of Good Standing with respect to the Borrower
issued by the Secretary of State of the State of Tennessee,
dated as of __________, 1998 (the "Tennessee Certificate");
10. Certificate of Good Standing with respect to the Guarantor
issued by the Secretary of State Of the State of Maryland,
dated as of __________, 1998 (the "Maryland Certificate"); and
11. Certificate of Good Standing with respect to the Guarantor
issued by the Secretary of State of the State of Georgia,
dated as of __________, 1998 (the "Georgia Certificate").
12. The Material Agreements (as defined below).
This opinion letter is governed by, and shall be interpreted in
accordance with, the January 1, 1992 edition of the Interpretive Standards
Applicable to Certain Legal Opinions to Third Parties in Corporate Transactions
adopted by the Legal Opinion Committee of the Corporate and Banking Law Section
of the State Bar of Georgia (the "Interpretive Standards"), which Interpretive
Standards are incorporated in this opinion letter by this reference. As a
consequence, this opinion letter is subject to a number of qualifications,
exceptions, definitions, limitations on coverage and other limitations, all as
more particularly described in the Interpretive Standards, and this opinion
letter should be read in conjunction therewith.
274
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
__________, 1998
Page 3
In our examination of documents for the purpose of rendering the
opinions set forth below, we have assumed the genuineness of all signatures
other than those on the Transaction Documents for or on behalf of the Borrower
and Guarantor, the authenticity of all documents submitted to us as originals,
the conformity with the originals of all documents submitted to us as copies,
and the authenticity of such latter documents. As to questions of fact material
to our opinions, we have relied, with your permission, and without independent
verification of the accuracy or completeness thereof, solely upon (i) the
contents of the Borrower's and Guarantor's respective corporate minute book, as
described in item 7 above; (ii) the statements and representations of certain
corporate officers of the Borrower and Guarantor set forth in the Officer's
Certificates attached hereto as Exhibits "A-1" and "A-2", respectively
(collectively, the "Officer's Certificates"); (iii) the statements and
representations contained in the Maryland Certificate, the Tennessee Certificate
and the Georgia Certificate; and (iv) the Borrower's and Guarantor's respective
statements, representations and warranties contained in the Transaction
Documents.
Whenever our opinion herein is qualified by the phrase "to our
knowledge," or any other phrase of similar import, it is intended to indicate
that the current actual knowledge of the attorneys within this firm actively
engaged in the representation of the Borrower or the Guarantor is not
inconsistent with that portion of the opinion which such phrase qualifies; our
use of such phrases shall not indicate that we have made, and, in fact we have
not made, an independent investigation concerning the accuracy or veracity of
the representations or warranties or statements of fact contained in any of the
Transaction Documents, the Officer's Certificates, the Maryland Certificate, the
Tennessee Certificate, the Georgia Certificate or any other documents identified
in the preceding paragraph, or that we have made any review of any files,
documents or other materials relating to the Borrower or Guarantor which have
come into our possession in connection with any transactions other than the
transactions contemplated by the Transaction Documents. We have not made any
independent review or investigation of orders, judgments or decrees by which the
Borrower or Guarantor is or may be bound, nor have we made any independent
investigation as to the existence of actions, suits, investigations or
proceedings, if any, pending or threatened against the Borrower, and we have
made no searches of any litigation dockets or any other public records.
Except to the extent set forth in the following sentence, our opinions
herein are limited to the laws of the State of Georgia and the federal laws of
the United States of America. To the extent that the opinions expressed below
involve matters governed by the General Corporation Law of Maryland or the
Tennessee Business Corporation Act, with your permission, we have based our
opinions solely on, and limited our review to, the applicable provisions of
those statutes, as reported and annotated in Aspen Law & Business\Xxxxxxxx-Xxxx
Information Services, Corporation Statutes, State Statutes, Volume 4 and Volume
7 (1994; as updated through January, 1998). We are not admitted to the bar of
any state other than the State of Georgia.
275
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
__________, 1998
Page 4
Based on and subject to the foregoing and such other qualifications as
are set forth below, we are of the opinion that:
1. The Borrower is a corporation, duly organized, validly
existing and, based solely on our review of the Tennessee Certificate, in good
standing under the laws of the State of Tennessee. The Guarantor is a
corporation, duly organized, validly existing and, based solely on our review of
the Maryland Certificate, in good standing under the laws of the State of
Maryland. Based solely on our review of the Georgia Certificate the Guarantor is
a corporation authorized to transact business as a foreign corporation under the
laws of the State of Georgia. As used herein, "good standing" shall mean that
all filings and registrations have been made under the applicable filing and
annual registration provisions under the respective business corporation code of
such entity's state of incorporation, and that all filing fees that are due and
payable thereunder have been paid.
2. Each of the Borrower and the Guarantor has the full corporate
power and corporate authority to execute, deliver and perform all of its
respective obligations under the Credit Agreement and the other Transaction
Documents to which it is a party, and the execution, delivery and performance by
the Borrower and the Guarantor of the Transaction Documents to which it is a
party have been authorized by all necessary corporate action.
3. Each of the Transaction Documents to which it is a party has
been duly executed and delivered by the Borrower and the Guarantor and each of
the Transaction Documents to which it is a party constitutes a legal, valid and
binding obligation of the Borrower and the Guarantor enforceable against
Borrower and Guarantor, as applicable, in accordance with its respective terms.
4. The execution, delivery and performance by the Borrower and
Guarantor of the Transaction Documents to which it is a party in accordance with
their respective terms will not:
(i) violate any provision of its respective Articles of
Incorporation or Bylaws;
(ii) violate any laws, ordinances, governmental rules or
regulations applicable to it or its respective property;
(iii) result in the breach of or constitute a default under any
Material Agreement (the term "Material Agreement," as used herein, shall mean
each of the agreements which has been filed with the Securities and Exchange
Commission as an exhibit (including any document which, in lieu of being filed
as such an exhibit, is incorporated by reference or which the Guarantor agrees
or has agreed to provide to the Securities and Exchange Commission upon request)
to the Guarantor's most recently filed Annual Report on Form 10-K, or any
subsequently filed report of Guarantor on Form 10-Q or Form 8-K,
276
SunTrust Bank, Atlanta, as Agent
First Union National Bank and
NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
__________, 1998
Page 5
pursuant to the requirements of Item 601(b)(10) of XXX Xxxxxxxxxx
X-X, 00 XXX ss. 229.601(b)(10), as amended); or
(iv) to our knowledge, result in either (a) the violation of any
judicial or administrative decree, writ, judgment or order to which it or its
respective assets is subject or (b) the creation of or imposition of any
contractual lien in favor of anyone other than the Lenders, the Agent or the
Co-Agents upon or with respect to any of its respective property.
5. No consent, approval, license, exemption of or filing or
registration with any court or governmental department, commission, board,
bureau, agency or instrumentality is necessary for the valid execution, delivery
or performance by Borrower or the Guarantor of the Transaction Documents to
which it is a party.
6. While the laws of the State of Georgia relating to matters of
interest and usury are not without ambiguities, a court applying the laws of the
State of Georgia in a properly reasoned opinion should conclude that the
Transaction Documents are in compliance with the laws of the State of Georgia;
provided, however, that we express no opinion herein as to any provision of any
Transaction Document (if any) that may be construed to require or permit
interest to be charged or paid on unpaid interest except to the extent permitted
under official Code of Georgia Annotated ("O.C.G.A.") ss. 7-4-17.
7. Neither the Borrower nor the Guarantor is an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, or a "subsidiary company" of a "holding
company" or an "affiliate" of a "holding company" or of a "subsidiary company"
of a "holding company" within the meaning of the Public Utility Holding Company
Act of 1935, as amended.
8. The making of any Loans and the application of the proceeds
thereof as provided in the Credit Agreement do not violate Regulation G. T. U or
X of the Board of Governors of the Federal Reserve System.
Our opinions set forth herein are also further limited by the following
exceptions and qualifications:
(i) We have assumed that the only interest, fees and other charges
contracted for or to be reserved, charged, taken or paid in connection with the
loan transaction contemplated by the Transaction Documents are those set forth
in the Transaction Documents and that all such interest, fees and charges will
be reserved, charged, taken and applied by the Lenders solely as described
therein. We also have assumed that no interest shall be reserved, charged, taken
or paid under the Transaction Documents on unpaid interest and that under no
circumstances shall the rate of interest payable under the Transaction
277
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
__________, 1998
Page 6
Documents exceed 5.0% per month (whether due to prepayment, acceleration, lack
of borrowing or otherwise). We also have assumed that the proceeds of the Loans
will be used by the Borrower in accordance with the terms of the Credit
Agreement.
(ii) Our opinion with respect to the enforceability of the
indemnification provisions contained in the Transaction Documents is limited by
the existence of a split of judicial authority concerning the enforceability of
private indemnification agreements with respect to liabilities arising under the
federal Comprehensive Environmental Response, Compensation and Liability Act
("CERCLA"). Although a majority of courts which have addressed that issue to
date have held that private parties may apportion by contract any liability
arising under CERCLA, standing decisions by a minority of such courts have held
that such private indemnification agreements cannot be enforced to the extent
that they effectively relieve responsible parties from liabilities expressly
allocated by CERCLA. Neither the United States Supreme Court, the United States
Court of Appeals for the Eleventh Circuit, the Georgia Supreme Court nor any
other court whose decisions would clearly constitute binding authority with
respect to interpretation of the Transaction Documents has addressed this issue.
Accordingly, at present, the enforceability of any indemnification provisions of
the Transaction Documents that purport to cover liabilities created or allocated
under CERCLA, or similar environmental laws, cannot be said to be free from
doubt.
(iii) Our opinion with respect to the enforceability of any of the
Transaction Documents is qualified to the extent enforcement may be limited by
certain other laws and legal and equitable principles of the State of Georgia
and federal law which may limit or render ineffective certain of the rights,
remedies and waivers contained in the Transaction Documents, none of which other
laws or legal or equitable principles should substantially interfere with the
practical realization by the Lenders of the benefits intended to be afforded
under the Transaction Documents.
(iv) With respect to any element of mutuality which may be required
in order to support the enforceability of the Transaction Documents, we have
assumed that the Lenders, the Agent and the Co-Agents have all requisite power
and authority to enter into and perform their respective obligations under the
Credit Agreement and the other Transaction Documents to which they are parties,
that the Credit Agreement and such other Transaction Documents have been duly
authorized, executed and delivered by such Lenders, the Agent and the Co-Agent,
and that the Credit Agreement and such other Transaction Documents constitute
the legal, valid and binding obligations of such Lenders, the Agent and the
Co-Agents.
(v) Our opinion with respect to the enforceability of the Guaranty
is also subject to the effects of laws of the State of Georgia which may, in the
absence of a waiver or consent by a guarantor, discharge such guarantor as a
result of (a) the discharge of the guaranteed obligation, (b) any change in
278
SunTrust Bank, Atlanta, as Agent
First Union National Bank and NationsBank, N.A., as Co-Agents
And the Lenders from time to time party to
The Credit Agreement hereafter described
___________, 1998
Page 7
the nature or terms of the guaranteed obligations, (c) any release or
compounding with any co-guarantor, (d) any action of a creditor that injures or
increases the risk to which such guarantor is exposed, including any impairment
of collateral for the guaranteed obligation, or (e) any failure by the creditor
to comply with the provisions of O.C.G.A. Section 10-7-23 or Section 10-7-24.
This opinion letter has been delivered solely for the benefit of the
Agent, the Co-Agents, the Lenders and their permitted successors and assigns
under the Transaction Documents in connection with the transactions contemplated
by the Credit Agreement and may not be relied upon by any other person or entity
or for any other purpose without our express prior written permission. We
expressly disclaim any duty to update this opinion letter in the future in the
event there are any changes in relevant fact or law that may change or otherwise
affect any of the opinions expressed herein.
Very truly yours,
XXXXX, XXXXXXXX & XXXXXXX, LLP
By:
-----------------------------------
Xxxxxx Xxx Xxxxxxxx, a Partner
279
EXHIBIT "A-1"
FORM OF OFFICER'S CERTIFICATE
OFFICER'S CERTIFICATE
OF
HAVERTYS CREDIT SERVICES, INC.
The undersigned, Xxxxx X. Xxxxxx, in his capacity as President of
Havertys Credit Services, Inc., a Tennessee corporation (the "Borrower"), has
executed this Certificate in connection with the opinion letter (the "Opinion
Letter") to be rendered by Xxxxx, Xxxxxxxx & Xxxxxxx, LLP pursuant to the
consummation of the transactions contemplated by that certain Credit Agreement
(the "Credit Agreement"), dated as of ___________, 1998, between Havertys Credit
Services, Inc., SunTrust Bank, Atlanta, as agent (the "Agent"), ____________ and
___________, as Co-Agents, and the Lenders that are a party thereto (the
"Lenders") and that certain Guaranty dated _____________, 1998 executed by
Xxxxxxx Furniture Companies, Inc. in favor of the Agent, and ________________,
as Co-Agents, and the Lenders. The undersigned authorizes Xxxxx, Xxxxxxxx &
Xxxxxxx, LLP to rely on this Certificate in rendering the Opinion Letter.
Capitalized terms set forth in this Certificate and not otherwise defined
herein, shall have the meanings ascribed to them in the Credit Agreement.
The undersigned hereby certifies that:
1. The following persons are the duly elected and qualified
officers of the Borrower occupying the office set forth next to his respective
name:
President and General Manager: Xxxxx X. Xxxxxx
Secretary and Treasurer: Xxxxxx Xxxxxx, Xx.
2. The corporate minute book of the Borrower provided to Xxxxx,
Xxxxxxxx & Xxxxxxx, LLP contains a true and correct copy of the Bylaws and
Articles of Incorporation of the Borrower, and all amendments thereto, if any,
and all minutes of meetings of the shareholders and the Board of Directors of
the Borrower.
3. The statements, representations and warranties of the Borrower
contained in the Credit Documents are true and correct in all respects and
Xxxxx, Xxxxxxxx & Xxxxxxx, LLP is entitled to rely thereon in rendering the
Opinion Letter.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
__________________________, 1998.
----------------------------------
Xxxxx X. Xxxxxx, as President
of Havertys Credit Services, Inc.
280
EXHIBIT "A-2"
FORM OF OFFICER'S CERTIFICATE
OFFICER'S CERTIFICATE
OF
XXXXXXX FURNITURE COMPANIES, INC.
The undersigned, Xxxxxx X. Xxxx, in his capacity as Executive Vice
President of Xxxxxxx Furniture Companies, Inc., a Maryland corporation (the
"Guarantor"), has executed this Certificate in connection with the opinion
letter (the "Opinion Letter") to be rendered by Xxxxx, Xxxxxxxx & Xxxxxxx, LLP
pursuant to the consummation of the transactions contemplated by that certain
Credit Agreement (the "Credit Agreement"), dated as of _____________, 1998,
between Havertys Credit Services, Inc. and SunTrust Bank Atlanta, as Agent,
_____________ and _____________, as Co-Agents, and the Lenders that are a party
thereto (the "Lenders") and that certain Guaranty, dated as of _____________,
1998, executed by Guarantor in favor of the Lenders. The undersigned authorizes
Xxxxx, Xxxxxxxx & Xxxxxxx, LLP to rely on this Certificate in rendering the
Opinion Letter. Capitalized terms set forth in this Certificate and not
otherwise defined herein, shall have the meanings ascribed to them in the Credit
Agreement.
The undersigned hereby certifies that:
1. The following persons are duly elected and qualified officers
of the Guarantor occupying the office set forth next to his or her respective
name:
President and Chief Executive Officer: Xxxx X. Xxxxxx, Xx.
Executive Vice President and Chief
Financial Officer: Xxxxxx X. Xxxx
Secretary and Vice President,
Finance: Xxxxx X. Xxxxxx
2. The corporate minute book of the Guarantor provided to Xxxxx,
Xxxxxxxx & Xxxxxxx, LLP contains a true and correct copy of the Bylaws and
Articles of Incorporation of the Guarantor, and all amendments thereto, if any,
and all minutes of meetings of the shareholders and the Board of Directors and
the Executive Committee of Board of Directors of the Guarantor.
3. The statements, representations and warranties of the
Guarantor contained in the Credit Documents are true and correct in all respects
and Xxxxx, Xxxxxxxx & Xxxxxxx, LLP is entitled to rely thereon in rendering the
Opinion Letter.
IN WITNESS WHEREOF, the undersigned has executed this Certificate as of
______________________, 1998.
-------------------------------------------
Xxxxxx X. Xxxx, as Executive Vice President
of Xxxxxxx Furniture Companies, Inc.
281
EXHIBIT K
FORM OF ASSIGNMENT AND ACCEPTANCE
Reference is made to that certain Credit Agreement dated as of
March 31, 1998 (as may be amended, modified or supplemented to the date hereof,
the "Credit Agreement"), among HAVERTYS CREDIT SERVICES, INC., as Borrower (the
"Borrower"), the lenders listed on the signature pages thereof ("Lenders"),
SUNTRUST BANK, ATLANTA, as Agent, and FIRST UNION NATIONAL BANK and NATIONSBANK,
N.A., as Co-Agents. Terms defined in the Credit Agreement are used herein with
the same meanings.
1. Assignor (as identified below) hereby sells and assigns to Assignee (as
identified below), without recourse against Assignor, and Assignee
hereby purchases and assumes from Assignor, without recourse against
Assignor, effective as of the Effective Date hereinafter set forth, the
interests set forth below (collectively, the "Assigned Interest"), in
Assignor's rights and obligations under the Credit Agreement, including
without limitation, the below specified [Revolving Loan Commitment] on
the Effective Date, and the below specified [Revolving Loans] [Letter
of Credit Obligations] [Bid Rate Loans] [Swing Line Loans] owing to
Assignor that are outstanding on the Effective Date, together with
unpaid interest accrued on the assigned Loans to the Effective Date,
and the amount (if any) set forth below of the fees referred to in
Section 3.05(b) and (c) of the Credit Agreement accrued to the
Effective Date for the account of Assignor. From and after the
Effective Date, (a) Assignee shall be a party to and be bound by the
provisions of the Credit Agreement, and to the extent of the interest
assigned by this Assignment and Acceptance, have the rights and
obligations of a Lender thereunder and under the Credit Documents
(except for any such obligations that are due and payable on, or that
become due and payable before, the effectiveness of this Assignment and
Acceptance), and (b) Assignor shall, to the extent of its interest
assigned by this Assignment and Acceptance and otherwise to the extent
set forth in the foregoing clause (a), relinquish its rights and be
released from its obligations under the Credit Agreement and the Credit
Documents.
2. Each of the Assignor and the Assignee represents, warrants and agrees
to and with the other and the Agent as follows: (i) Assignor warrants
that it is the legal and beneficial owner of the interest being
assigned hereby free and clear of any adverse claim and that its
[Revolving Loan Commitment], and the outstanding balances of its
[Loans] [Letter of Credit Obligations] under each Facility, in each
case, without giving effect to assignments thereof which have not
become effective, are as set forth below, (ii) except as set forth in
(i), Assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement, or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Credit Agreement or any other Credit
Document or any
282
instrument or documents furnished pursuant thereto, or the financial
condition of Haverty or any other Credit Party or the performance or
observance by any Credit Party of any of its obligations under the
Credit Documents; (iii) the Assignee represents and warrants that it is
legally authorized to enter into this Assignment and Acceptance; (iv)
Assignee confirms that it has received a copy of the Credit Agreement,
such financial statements and other documents and information as it has
deemed appropriate to make its own credit analysis and decision to
enter into this Assignment and Acceptance; (v) Assignee agrees that it
will perform its obligations as a Lender under the Credit Documents as
required by the terms thereof; and (vi) Assignee appoints and
authorizes the Agent to take such actions as agent on its behalf and to
exercise such powers under the Credit Agreement and the other Credit
Documents as are delegated to the Agent by the terms of the Credit
Agreement and the other Credit Documents, together with such powers as
are reasonably incidental thereto.
3. This Assignment and Acceptance is being delivered to the Agent,
together with (i) the Notes evidencing the Loans included in the
Assigned Interest, and (ii) a copy of the Assignment and Acceptance
after it is duly executed by each of the Assignee and the Assignor.
4. This Assignment shall be governed by and construed in accordance with
the laws of the State of Georgia, without regard to the conflict of
laws principles thereof.
Date of Assignment:
Legal Name of Assignor:
Legal Name of Assignee:
Assignee's Address (Including Telex and Telecopy Numbers) for Notices:
Assignee's Lending Office:
283
Effective Date of Assignment (may not be fewer than five (5) Business Days after
the date of the Assignment):
PERCENTAGE OF
PRINCIPAL AMOUNT COMMITMENT
FACILITY ASSIGNED ASSIGNED
-------- ---------------- -------------
Revolving
Loan Facility $ %
Letter of Credit
Facility $ "
Bid Rate
Facility $ "
Swing Line
Facility $ "
Immediately after giving effect to this Assignment:
(a) The aggregate amount of the Revolving Loan Commitment of Assignor is
--------------------;
(b) The aggregate amount of the Letter of Credit Obligations of the
Assignor is
--------------------;
(c) The aggregate amount of the Bid Rate Loans of the Assignor is
--------------------;
[(d) The aggregate amount of the Swing Line Loans of the Assignor is
--------------------.]
The terms set forth herein are
hereby agreed to by
, as Assignor.
------------------------
By:
----------------------------------
Name:
Title:
As Assignor
284
The terms set forth herein are
hereby agreed to by
, as Assignee.
------------------------
By:
--------------------------------------
Name:
Title:
As Assignee
CONSENTED TO:
SUNTRUST BANK, ATLANTA, AS AGENT
By:
--------------------------------------
Name:
Title:
As Assignee
HAVERTYS CREDIT SERVICES, INC.
By:
--------------------------------------
Name:
Title:
As Assignee
