$210,000,000
CREDIT AGREEMENT
among
CORE-XXXX INTERNATIONAL, INC.,
The Several Lenders
from Time to Time Parties Hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
Dated as of August 7, 1996
TABLE OF CONTENTS
SECTION 1. DEFINITIONS 1
1.1 Defined Terms 1
1.2 Other Definitional Provisions 24
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS 25
2.1 Revolving Credit Commitments 25
2.2 Procedure for Revolving Credit Borrowing 25
2.3 Fees 26
2.4 Termination or Reduction of Commitments 26
2.5 Term Loans 26
2.6 Procedure for Term Loan Borrowing 26
2.7 Repayment of Loans; Evidence of Debt 26
2.8 Optional Prepayments 28
2.9 Mandatory Prepayments 28
2.10 Mandatory Prepayments and Other Reductions
of Revolving Credit Loans 29
2.11 Conversion and Continuation Options 30
2.12 Maximum Number of Tranches 31
2.13 Interest Rates and Payment Dates 31
2.14 Computation of Interest and Fees 31
2.15 Inability to Determine Interest Rate 32
2.16 Pro Rata Treatment and Payments 32
2.17 Illegality 33
2.18 Requirements of Law 34
2.19 Taxes 34
2.20 Indemnity 36
2.21 Change of Lending Office 37
SECTION 3. LETTERS OF CREDIT 37
3.1 L/C Commitment. 37
3.2 Procedure for Issuance of Letters of Credit 37
3.3 Fees, Commissions and Other Charges 38
3.4 L/C Participations 38
3.5 Reimbursement Obligation of the Borrower 39
3.6 Obligations Absolute 40
3.7 Letter of Credit Payments 40
3.8 Application 40
SECTION 4. REPRESENTATIONS AND WARRANTIES 41
4.1 Financial Condition 41
4.2 No Change 42
4.3 Corporate Existence; Compliance with Law 42
4.4 Corporate Power; Authorization; Enforceable
Obligations 42
4.5 No Legal Bar 42
4.6 No Material Litigation 43
4.7 No Default 43
4.8 Ownership of Property; Liens 43
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4.9 Intellectual Property 43
4.10 No Burdensome Restrictions 43
4.11 Taxes 43
4.12 Federal Regulations 44
4.13 ERISA 44
4.14 Investment Company Act; Other Regulations 44
4.15 Subsidiaries 44
4.16 Purpose of Loans 44
4.17 Environmental Matters 45
4.18 Accuracy of Information 46
4.19 Security Documents 46
4.20 Solvency 47
SECTION 5. CONDITIONS PRECEDENT 47
5.1 Conditions to Initial Extension of Credit 47
5.2 Conditions to Each Extension of Credit 50
SECTION 6. AFFIRMATIVE COVENANTS 51
6.1 Financial Statements 51
6.2 Certificates; Other Information 52
6.3 Payment of Obligations 54
6.4 Conduct of Business and Maintenance of
Existence 54
6.5 Maintenance of Property; Insurance 54
6.6 Inspection of Property; Books and Records;
Discussions 54
6.7 Semi-Annual Reviews 54
6.8 Notices 55
6.9 Environmental Laws 56
6.10 Further Assurances 56
6.11 Cash Management System 56
6.12 Additional Collateral 56
6.13 Tax Stamp Bonding. 57
6.14 Compliance with Terms of Leaseholds. 57
SECTION 7. NEGATIVE COVENANTS 58
7.1 Financial Condition Covenants 58
7.2 Limitation on Indebtedness 60
7.3 Limitation on Liens 61
7.4 Limitation on Guarantee Obligations 62
7.5 Limitation on Fundamental Changes 62
7.6 Limitation on Sale of Assets 63
7.7 Limitation on Speculative Transactions 64
7.8 Limitation on Dividends 64
7.9 Limitation on Capital Expenditures 64
7.10 Limitation on Investments, Loans and
Advances 64
7.11 Limitation on Optional Payments and
Modifications of Debt Instruments 65
7.12 Limitation on Transactions with Affiliates 65
7.13 Limitation on Sales and Leasebacks 66
7.14 Limitation on Changes in Fiscal Year 66
7.15 Limitation on Negative Pledge Clauses 66
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7.16 LIMITATION ON LINES OF BUSINESS 66
SECTION 8. EVENTS OF DEFAULT 66
SECTION 9. THE ADMINISTRATIVE AGENT 69
9.1 Appointment 69
9.2 Delegation of Duties 70
9.3 Exculpatory Provisions 70
9.4 Reliance by Administrative Agent 70
9.5 Notice of Default 70
9.6 Non-Reliance on Administrative Agent and
Other Lenders 71
9.7 Indemnification 71
9.8 Administrative Agent in Its Individual
Capacity 72
9.9 Successor Administrative Agent 72
SECTION 10. MISCELLANEOUS 72
10.1 Amendments and Waivers 72
10.2 Notices 73
10.3 No Waiver; Cumulative Remedies 74
10.4 Survival of Representations and Warranties 74
10.5 Payment of Expenses and Taxes 74
10.6 Successors and Assigns; Participations and
Assignments 75
10.7 Adjustments; Set-off 77
10.8 Counterparts 78
10.9 Severability 78
10.10 Integration 78
10.11 GOVERNING LAW 78
10.12 Submission To Jurisdiction; Waivers 78
10.13 Acknowledgements 79
10.14 WAIVERS OF JURY TRIAL 79
10.15 Judgment Currency 79
10.16 Confidentiality 80
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SCHEDULES
1.1(a) Commitments
4.2 Changes
4.4 Consents
4.6 Litigation
4.8 Ownership of Property; Liens
4.9 Intellectual Property
4.11 Taxes
4.13 ERISA
4.15 Subsidiaries
4.17 Environmental Matters
4.19(b) Security Documents; Offices
7.2 Indebtedness
7.3 Liens
7.4 Guarantee Obligations
EXHIBITS
Exhibit A Form of Revolving Credit Note
Exhibit B Form of Term Note
Exhibit C Form of Security Agreement
Exhibit D Form of Borrower Stock Pledge Agreement
Exhibit E Form of Subsidiaries Guarantee
Exhibit F Form of Borrowing Base Certificate
Exhibit G Form of Borrowing Certificate
Exhibit H Form of Responsible Officer's Certificate
Exhibit I Form of Supplemental Reporting
Exhibit J-1 Form of Opinion of Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx
Exhibit J-2 Form of Opinion of Sheppard, Mullin,
Xxxxxxx & Hampton, LLP
Exhibit J-3 Form of Opinion of Stoel, Rives, Xxxxx
Xxxxxx & Xxxx
Exhibit J-4 Form of Opinions of Stikeman, Xxxxxxx; and
Xxxxxxxx Xxxxxxx Xxxxxxxx
Exhibit K Form of Assignment and Acceptance
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1
CREDIT AGREEMENT, dated as of August 7, 1996, among CORE-XXXX
INTERNATIONAL, INC., a Delaware corporation (the "BORROWER"), the several
banks and other financial institutions from time to time parties to this
Agreement (the "LENDERS") and The Chase Manhattan Bank, a New York banking
corporation, as administrative agent for the Lenders hereunder.
The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
1.1 DEFINED TERMS. As used in this Agreement, the following
terms shall have the following meanings:
"ABR": for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the greatest of (a)
the Prime Rate in effect on such day, (b) the Base CD Rate in effect
on such day plus 1% and (c) the Federal Funds Effective Rate in effect
on such day plus 1/2 of 1%. For purposes hereof: "PRIME RATE" shall
mean the rate of interest per annum publicly announced from time to
time by the Administrative Agent as its prime rate in effect at its
principal office in New York City (the Prime Rate not being intended
to be the lowest rate of interest charged by Chase Manhattan Bank in
connection with extensions of credit to debtors); "BASE CD RATE" shall
mean the sum of (a) the product of (i) the Three-Month Secondary CD Rate
(ii) a fraction, the numerator of which is one and the denominator of
which is one minus the C/D Reserve Percentage and (b) the C/D Assessment
Rate; "THREE-MONTH SECONDARY CD RATE" shall mean, for any day, the
secondary market rate for three-month certificates of deposit reported as
being in effect on such day (or, if such day shall not be a Business Day,
the next preceding Business Day) by the Board of Governors of the Federal
Reserve System (the "BOARD") through the public information telephone line
of the Federal Reserve Bank of New York (which rate will, under the current
practices of the Board, be published in Federal Reserve Statistical Release
H.15(519) during the week following such day), or, if such rate shall not
be so reported on such day or such next preceding Business Day, the average
of the secondary market quotations for three-month certificates of deposit
of major money center banks in New York City received at approximately
10:00 A.M., New York City time, on such day (or, if such day shall not be
a Business Day, on the next preceding Business Day) by the Administrative
Agent from three New York City negotiable certificate of deposit dealers
of recognized standing selected by it; and "FEDERAL FUNDS EFFECTIVE RATE"
shall mean, for any day, the weighted average of the rates on overnight
federal funds transactions with members of the Federal Reserve System
arranged by federal funds brokers, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate
is not so published for any day which is a Business Day, the average of
the quotations for the day of such transactions received by the
Administrative Agent from three federal funds brokers of recognized
standing selected by it. Any change in the ABR due to a change in the
Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate shall be effective as of the opening of business on the
effective day of such change in
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the Prime Rate, the Three-Month Secondary CD Rate or the Federal
Funds Effective Rate, respectively.
"ABR LOANS": Loans the rate of interest applicable to which is based
upon the ABR.
"ACCOUNT": as defined in Section 9-106 of the UCC.
"ADMINISTRATIVE AGENT": Chase, together with its affiliates, as the
arranger of the Commitments and as the administrative agent for the
Lenders under this Agreement and the other Loan Documents.
"AFFILIATE": as to any Person, any other Person (other than a
Subsidiary) which, directly or indirectly, is in control of, is controlled
by, or is under common control with, such Person. For purposes of this
definition, "control" of a Person means the power, directly or indirectly,
either to (a) vote 10% or more of the securities having ordinary voting
power for the election of directors of such Person or (b) direct or cause
the direction of the management and policies of such Person, whether by
contract or otherwise.
"AGGREGATE COVERED OUTSTANDING REVOLVING EXTENSIONS OF CREDIT": at
any date of determination, the excess of (a) the Aggregate Outstanding
Revolving Extensions of Credit over (b) the lesser of the L/C Obligations
then outstanding and the Uncovered L/C Amount.
"AGGREGATE OUTSTANDING REVOLVING EXTENSIONS OF CREDIT": at any time,
an amount equal to the sum of (a) the aggregate principal amount of all
Revolving Credit Loans then outstanding and (b) the L/C Obligations then
outstanding.
"AGREEMENT": this Credit Agreement, as amended, supplemented or
otherwise modified from time to time.
"APPLICATION": an application, in such form as the Issuing Bank may
specify from time to time, requesting the Issuing Bank to open a Letter of
Credit.
"ASSIGNEE": as defined in subsection 10.6(c).
"AVAILABLE REVOLVING CREDIT COMMITMENTS": at any time, an amount
equal to the excess, if any, of (a) the Revolving Credit Commitments over
(b) the Aggregate Outstanding Revolving Extensions of Credit.
"BORROWER SECURITY DOCUMENTS": the collective reference to the
Security Agreement and the Borrower Stock Pledge Agreement.
"BORROWER STOCK PLEDGE AGREEMENT": the Borrower Stock Pledge
Agreement to be executed and delivered by the Borrower, substantially in
the form of Exhibit D, as the same may be amended, supplemented or
otherwise modified from time to time.
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"BORROWING BASE": on any date of determination thereof, the sum
(without duplication) of:
a. 85% of the aggregate Eligible Accounts Receivable;
b. 90% of the aggregate Uncleared US Checks;
c. 85% of the excess of the aggregate Eligible Canadian Cash Equivalents
over the Canadian Cash Adjustment;
d. 75% of the aggregate Eligible Vendor Receivables;
e. 85% of the aggregate Eligible Cigarette Inventory purchased by the
Borrower on zero day EFT terms;
f. 65% of the aggregate Eligible Cigarette Inventory purchased by the
Borrower on terms other than zero day EFT terms;
g. 80% of the aggregate Eligible Tobacco and Cigar Inventory;
h. 65% of the aggregate Eligible Other Inventory; and
i. 100% of the aggregate cash held by the Administrative Agent in the US
Cash Collateral Account.
All determinations in connection with the Borrowing Base shall be (i) made
by the Borrower in conjunction with the Borrowing Base Certificates and
Supplemental Reportings to be provided by the Borrower to the
Administrative Agent pursuant to subsection 6.2(f), (ii) made by the
Borrower in Dollars, and any amounts determined in Canadian dollars shall,
for purposes of calculating the Borrowing Base, be converted into Dollars
at the Spot Rate and (iii) certified to the Administrative Agent by a
Responsible Officer of the Borrower, provided, however, that the
Administrative Agent shall have the final right to review and adjust, in
its reasonable judgment, any such determination to the extent such
determination is not in accordance with this Agreement. The Administrative
Agent may also decrease any of the foregoing percentages upon ten Business
Days' written notice to the Borrower if, in the judgment of the
Administrative Agent in its reasonable discretion based on the findings of
the on-site periodic field exams conducted pursuant to subsection 6.7, a
material adverse change shall have occurred in any of the items included in
the Borrowing Base.
"BORROWING BASE CERTIFICATE": a certificate delivered by the Borrower
to the Administrative Agent pursuant to subsection 6.2(f) and certified by
a Responsible Officer of the Borrower, substantially in the form of Exhibit
F.
"BORROWING DATE": any Business Day specified in a notice pursuant to
subsection 2.2 or 2.6 as a date on which the Borrower requests the Lenders
to make Loans hereunder.
"BUSINESS": as defined in subsection 4.17.
"BUSINESS DAY": a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law
to close.
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"CANADIAN CASH ADJUSTMENT": as of any date of determination, the
aggregate total of all checks written and outstanding, payable to Canadian
government cigarette tax jurisdictions, for amounts owing to them related
to cigarette sales or purchases.
"CANADIAN CASH COLLATERAL ACCOUNT": has the meaning specified in the
Security Agreement.
"CANADIAN CASH EQUIVALENTS": means (i) any term deposit receipts of
the Bank of Montreal having a maturity of not greater than 90 days from the
date of acquisition thereof, (ii) cash owned by the Borrower or any of its
Subsidiaries and denominated in Canadian dollars and (iii) subject to the
receipt by the Administrative Agent of a written legal opinion in form and
substance and from a firm satisfactory to the Administrative Agent and its
counsel to the effect that the Administrative Agent and the Lenders would
have a perfected security interest in such items, the following items
having a maturity of not greater than 90 days from the date of acquisition
thereof:
(a) readily marketable direct obligations of the Government of
Canada or any province thereof or obligations unconditionally
guaranteed by the full faith and credit of the Government of Canada;
(b) insured certificates of deposit, deposit notes or term
deposit receipts of any commercial bank listed on Schedule 1 of the
Bank Act (Canada); or
(c) commercial paper in an aggregate amount of no more than
$1,000,000 per issuer outstanding at any time, issued by any
corporation organized under the laws of Canada or any province thereof
and rated at least A-1 or better (or the then equivalent grade) by
Canada Bond Rating Service or R-2 (middle) or better (or the then
equivalent grade) by Dominion Bond Rating Service.
"CAPITAL STOCK": any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation,
any and all equivalent ownership interests in a Person (other than a
corporation) and any and all warrants or options to purchase any of the
foregoing.
"CASH INTEREST EXPENSE": of any Person for any period, Interest
Expense of such Person for such period (a) minus, in each case to the
extent included in determining such Interest Expense for such period, the
sum of the following: (i) non-cash expenses for interest payable in kind
and (ii) amortization of debt discount and fees and (iii) the fees
described in subsections 2.3 and 3.3 and (b) plus the sum of the following
in each case to the extent previously subtracted pursuant to clause (a) of
this definition: cash payments made by such Person or any Subsidiary of
such Person during such period in respect of the items referred to in such
clause (a)(i).
"C/D ASSESSMENT RATE": for any day as applied to any ABR Loan, the
annual assessment rate in effect on such day which is payable by a member
of the Bank Insurance Fund maintained by the Federal Deposit Insurance
Corporation (the "FDIC") classified as well-capitalized and within
supervisory subgroup "B" (or a comparable
5
successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.4 (or any successor provision) to the FDIC (or any
successor)for the FDIC's (or such successor's) insuring time deposits
at offices of such institution in the United States.
"C/D RESERVE PERCENTAGE": for any day as applied to any ABR Loan,
that percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) (the "Board"), for determining the maximum reserve requirement
for a Depositary Institution (as defined in Regulation D of the Board) in
respect of new non-personal time deposits in Dollars having a maturity of
30 days or more.
"CHASE": The Chase Manhattan Bank.
"CIGARETTE INVENTORY": the cigarette Inventory of the Borrower and
its Subsidiaries, including all tax stamps (whether affixed or unaffixed)
in respect thereof.
"CLOSING DATE": the date on which the conditions precedent set forth
in subsection 4.1 shall be satisfied.
"CMIC": Core-Xxxx Interrelated Companies, Inc., a California
corporation and a wholly-owned Subsidiary of the Borrower.
"CM MIDCONTINENT": Core-Xxxx Midcontinent, Inc., an Arkansas
corporation and a wholly-owned Subsidiary of the Borrower.
"C/M PRODUCTS": C/M Products, Inc., a California corporation and a
wholly-owned Subsidiary of the Borrower.
"CODE": the Internal Revenue Code of 1986, as amended from time to
time.
"COLLATERAL": all assets of the Loan Parties, now owned or
hereinafter acquired, upon which a Lien is purported to be created by any
Security Document.
"COLLECTION ACCOUNTS": has the meaning specified in the Security
Agreement.
"COLLECTION ACCOUNTS LETTERS": has the meaning specified in the
Security Agreement.
"COMMERCIAL LETTER OF CREDIT": as defined in subsection 3.1(b)(1)(B).
"COMMITMENT PERIOD": the period from and including the date hereof to
but not including the Termination Date or such earlier date on which the
Commitments shall terminate as provided herein.
"COMMITMENTS": the collective reference to the Revolving Credit
Commitments and the Term Loan Commitments.
6
"COMMONLY CONTROLLED ENTITY": an entity, whether or not incorporated,
which is under common control with the Borrower within the meaning of
Section 4001 of ERISA or is part of a group which includes the Borrower and
which is treated as a single employer under Section 414 of the Code.
"CONSOLIDATED": when used in connection with any defined term, and not
otherwise defined, means such term as it applies to the Borrower and its
Subsidiaries on a consolidated basis, after eliminating all intercompany
items.
"CONSOLIDATED WORKING CAPITAL": as of the date of determination,
Current Assets of the Borrower and its Subsidiaries at such date,
determined on a consolidated basis in conformity with GAAP, minus Current
Liabilities of the Borrower and its Subsidiaries at such date, determined
on a consolidated basis in conformity with GAAP.
"CONTRACTUAL OBLIGATION": as to any Person, any provision of any
security issued by such Person or any provision applicable to such Person
of any agreement, instrument or other undertaking to which such Person is a
party or by which it or any of its property is bound.
"CONTROL PERCENTAGE": means 51%, provided that such percentage may be
reduced but not below 35%, if prior to or concurrently with such reduction,
the following conditions have been satisfied: (1) there has been an initial
public offering of the common stock of the Borrower, (2) the Term Loans
shall have been repaid in full, (3) the Uncovered L/C Amount shall have
been permanently reduced to zero, (4) the Overadvance Limit shall have been
permanently reduced to zero and (5) the lesser of (x) the available
Borrowing Base and (y) the Available Revolving Credit Commitments shall be
at least $15,000,000 determined on a pro forma basis giving effect to the
transaction that causes such reduction on the basis of the average amount
of the Borrowing Base and the Aggregate Outstanding Revolving Extensions of
Credit, respectively, during the calendar month preceding the month in
which such transaction occurs.
"CURRENT ASSETS": of any Person, at the date of determination, all
assets of such Person which would, in accordance with GAAP (using the
first-in, first-out inventory valuation method), be classified on a balance
sheet of such Person as current assets, other than deferred taxes.
"CURRENT LIABILITIES": of any Person, at the date of determination,
all liabilities of such Person which would, in accordance with GAAP (using
the first-in, first-out inventory valuation method), be classified on a
balance sheet of such Person as current liabilities, other than deferred
taxes and the current portion of any long-term Indebtedness of such
Person.
"CUSTOMER REBATE RESERVES": $100,000 for rebates to customers subject
to change by the Administrative Agent in its reasonable discretion based on
the findings of the on-site periodic field exams conducted pursuant to
subsection 6.7.
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"DEFAULT": any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, or
any other condition, has been satisfied.
"DEPOSIT ACCOUNT LETTERS": has the meaning specified in the Security
Agreement.
"DEPOSIT ACCOUNTS": has the meaning specified in the Security
Agreement.
"DEPOSITORY LETTERS": has the meaning specified in the Security
Agreement.
"DOLLARS" and "$": dollars in lawful currency of the United States of
America.
"EBITDA": means with respect to any Person, for any period, the Net
Income of such Person for such period determined on a consolidated basis,
plus, to the extent deducted in determining such Net Income, (i) Interest
Expense, (ii) depreciation, (iii) depletion, (iv) amortization, (v) all
Federal, state, local and foreign income taxes and (vi) any extraordinary
and unusual losses, and, minus, to the extent added in determining such Net
Income, any extraordinary and unusual gains, all as determined on a
consolidated basis in accordance with GAAP using the first-in, first-out
inventory valuation method.
"EFT": electronic funds transfer.
"ELIGIBLE ACCOUNTS RECEIVABLE": at a particular date, the total
outstanding balance of accounts receivable before bad debt reserves
historically recorded by the Borrower, determined in accordance with GAAP
and stated on a basis consistent with the historical practices of the
Borrower as of the date thereof (but excluding in any event any material
delivery charges, freight charges, finance charges, late fees and other
fees and less the value of any accrual which has been recorded by the
Borrower with respect to downward price adjustments) of the Borrower or any
of its Subsidiaries (excluding Vendor Receivables): (a) which are accounts
within the meaning of Section 9-106 of the New York Uniform Commercial Code
(or any successor provisions thereto), (b) which are bona fide, valid and
legally enforceable obligations of the parties thereto or the account
debtor in respect thereof and arise from the actual sale of goods in the
ordinary course of business to such account debtor or parties, (c) with
respect to which all consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority required to
be obtained, effected or given in connection with the execution, delivery
and performance of such accounts receivable have been duly obtained,
effected or given, are in full force and effect and do not subject the
scope of such Accounts to any materially adverse limitation, either
specific or general in nature, (d) which conform in all other respects to
the representations and warranties contained herein and in the Security
Agreement, (e) which have been invoiced by the Borrower or any of its
Subsidiaries and which are not more than 45 days past due, (f) which are
not owed by an obligor which is (i) a Governmental Authority, or (ii) an
Affiliate or Subsidiary of the Borrower, (g) which are not owed by an
obligor which has taken any of the actions or suffered any of the events of
the kind described in subsection 8(f), (h) which are not owed by an obligor
8
25% or more of the outstanding balance of accounts receivable of which do
not constitute Eligible Accounts Receivable hereunder, (i) which are
assignable and subject to a perfected, first-priority Lien in favor of the
Administrative Agent pursuant to the Security Agreement and which are not
subject to any other Liens except Liens permitted under subsection 7.3(a),
(b) or (h), (j) which are not owed by an obligor with terms greater than 45
days, (k) which the Borrower is not required to perform any additional
services or perform or incur any additional obligations to the account
debtor in order to collect such accounts receivable, (l) which are not
subject to any defense, setoff, recoupment or counterclaim, (m) to which
the Borrower or any of its Subsidiaries has good, valid and marketable
title as sole owner and as to which no other Person has asserted in writing
any claim to right of possession or dominion, (n) the obligor in respect of
which is located in the United States of America or in Canada, (o) which is
denominated in Dollars or in Canadian dollars, and (p) which the
Administrative Agent in its reasonable discretion based on the findings of
the on-site periodic field exams conducted pursuant to subsection 6.7 has
not otherwise determined to be unacceptable, EXCLUDING the aggregate amount
of Receivable Offsets and Customer Rebate Reserves and the aggregate amount
owing to any obligor who is a supplier or creditor of the Borrower or any
of its Subsidiaries to the extent that there is a receivable balance due
from such obligor that would otherwise constitute an Eligible Accounts
Receivable.
"ELIGIBLE CANADIAN CASH EQUIVALENTS": at a particular date, the total
value of Canadian Cash Equivalents credited to the Canadian Cash Collateral
Account and the Deposit Accounts in accordance with subsection 6.11.
"ELIGIBLE CIGARETTE INVENTORY": at a particular date, the total value
of the Cigarette Inventory of the Borrower and its Subsidiaries (calculated
as the lower of (x) cost, determined on a first in first out basis in
accordance with GAAP and stated on a basis consistent with the historical
practices of the Borrower on the date hereof before inventory reserves
historically recorded by the Borrower and (y) fair market value) (a) which
conforms in all respects to the representations and warranties contained
herein and in the Security Agreement, (b) which is located in the United
States of America, (c) which is subject to a perfected, first-priority Lien
in favor of the Administrative Agent pursuant to the Security Agreement and
which is not subject to any other Liens except Liens permitted under
subsection 7.3 (a), (b) or (h), (d) which is stored in the Borrower's or
any of its Subsidiaries' warehouses, which has been placed in the
Borrower's or any of its Subsidiaries' storage area or allocated to the
Borrower or any of its Subsidiaries in a third-party warehouse and
identified separately from the inventory of others, or which is in transit
between such third-party warehouses and Borrower's or any of its
Subsidiaries' warehouses, (e) to which the Borrower or any of its
Subsidiaries has good, valid and marketable title as sole owner and as to
which no other Person has asserted in writing any claim to right of
possession or dominion, (f) which is not raw materials, supplies, work-in-
process or packaging, packing or shipping materials, and (g) which the
Administrative Agent in its reasonable discretion based on the findings of
the on-site periodic field exams conducted pursuant to subsection 6.7 has
not otherwise determined to be unacceptable, excluding the aggregate amount
of the Inventory Reserves, Tax Reserves and Landlord Lien Reserves
allocable to such Inventory.
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"ELIGIBLE OTHER INVENTORY": at a particular date, the total value of
Inventory of the Borrower and its Subsidiaries (calculated as the lower of
(x) cost, determined on a first in a first out basis in accordance with
GAAP and stated on a basis consistent with the historical practices of the
Borrower on the date hereof before inventory reserves historically recorded
by the Borrower, and (y) fair market value: (a) which does not consist of
Tobacco Products Inventory, (b) which does not consist of fresh produce,
fresh meat or dairy products in an aggregate amount in excess of $250,000,
(c) which conforms in all respects to the representations and warranties
contained herein and in the Security Agreement, (d) which is located in the
United States of America, (e) which is subject to a perfected, first-
priority Lien in favor of the Administrative Agent pursuant to the Security
Agreement and which is not subject to any other Liens except Liens
permitted under subsection 7.3 (a), (b) or (h), (f) which is stored in the
Borrower's or any of its Subsidiaries' warehouses, which has been placed in
the Borrower's or any of its Subsidiaries' storage area or allocated to the
Borrower or any of its Subsidiaries in a third-party warehouse and
identified separately from the inventory of others, or which is in transit
between such third-party warehouses and Borrower's or any of its
Subsidiaries' warehouses, (g) to which the Borrower or any of its
Subsidiaries has good, valid and marketable title as sole owner and as to
which no other Person has asserted in writing any claim to right of
possession or dominion, (h) which is not raw materials, supplies, work-in-
process or packaging, packing or shipping materials, and (i) which the
Administrative Agent in its reasonable discretion based on the findings of
the on-site periodic field exams conducted pursuant to subsection 6.7 has
not otherwise determined to be unacceptable, excluding the aggregate amount
of the Inventory Reserves, Tax Reserves and Landlord Lien Reserves
allocable to such Inventory.
"ELIGIBLE TOBACCO AND CIGAR INVENTORY": at a particular date, the
total value of the Tobacco and Cigar Inventory of the Borrower and its
Subsidiaries (calculated as the lower of (x) cost, determined on a first in
first out basis in accordance with GAAP and stated on a basis consistent
with the historical practices of the Borrower on the date hereof before
inventory reserves historically recorded by the Borrower, and (y) fair
market value): (a) which is not Eligible Cigarette Inventory, (b) which
conforms in all respects to the representations and warranties contained
herein and in the Security Agreement, (c) which is located in the United
States of America, (d) which is subject to a perfected, first-priority Lien
in favor of the Administrative Agent pursuant to the Security Agreement and
which is not subject to any other Liens except Liens permitted under
subsection 7.3 (a), (b) or (h), (e) which is stored in the Borrower's or
any of its Subsidiaries' warehouses, which has been placed in the
Borrower's or any of its Subsidiaries' storage area or allocated to the
Borrower or any of its Subsidiaries in a third-party warehouse and
identified separately from the inventory of others, or which is in transit
between such third-party warehouses and Borrower's or any of its
Subsidiaries' warehouses, (f) to which the Borrower or any of its
Subsidiaries has good, valid and marketable title as sole owner and as to
which no other Person has asserted in writing any claim to right of
possession or dominion, (g) which is not raw materials, supplies, work-in-
process or packaging, packing or shipping materials, and (h) which the
Administrative Agent in its reasonable discretion based on the findings of
the on-site periodic field exams conducted pursuant to subsection 6.7 has
not otherwise determined to be unacceptable, EXCLUDING the aggregate amount
of the
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Inventory Reserves, Tax Reserves and Landlord Lien Reserves
allocable to such Inventory.
"ELIGIBLE VENDOR RECEIVABLES": at a particular date, the total
outstanding balance of Vendor Receivables of the Borrower and its
Subsidiaries, determined in accordance with GAAP and stated on a basis
consistent with the historical practices of the Borrower as of the date
thereof (a) which are accounts within the meaning of Section 9-106 of the
New York Uniform Commercial Code (or any successor provisions thereto), (b)
which are bona fide, valid and legally enforceable obligations of the
parties thereto or the account debtor in respect thereof and arise in the
ordinary course of business to such account debtor or parties, (c) with
respect to which all consents, licenses, approvals or authorizations of, or
registrations or declarations with, any Governmental Authority required to
be obtained, effected or given in connection with the execution, delivery
and performance of such accounts receivable have been duly obtained,
effected or given, are in full force and effect and do not subject the
scope of such Accounts to any materially adverse limitation, either
specific or general in nature, (d) which conform in all other respects to
the representations and warranties contained herein and in the Security
Agreement, (e) which are not owed by an obligor which is (i) a Governmental
Authority, or (ii) an Affiliate or Subsidiary of the Borrower, (f) which
are not owed by an obligor which has taken any of the actions or suffered
any of the events of the kind described in subsection 8(f), (g) which are
assignable and subject to a perfected, first-priority Lien in favor of the
Administrative Agent pursuant to the Security Agreement and which are not
subject to any other Liens except Liens permitted under subsection 7.3(a),
(b) or (h), (h) which are not subject to any defense, setoff, recoupment or
counterclaim, (i) to which the Borrower or any of its Subsidiaries has
good, valid and marketable title as sole owner and as to which no other
Person has asserted in writing any claim to right of possession or
dominion, (j) the obligor in respect of which is located in the United
States of America or in Canada, (k) which is denominated in Dollars or in
Canadian dollars, and (l) which the Administrative Agent in its reasonable
discretion based on the findings of the on-site periodic field exams
conducted pursuant to subsection 6.7 has not otherwise determined to be
unacceptable, excluding (1) the aggregate amount owing to any obligor who
is a supplier or creditor of the Borrower or any of its Subsidiaries to the
extent that there is a receivable balance due from such obligor that would
otherwise constitute an Eligible Vendor Receivable and (2) 50% of any
Vendor Receivable due 180 days or more from the applicable date of
determination.
"ENVIRONMENTAL LAWS": any and all foreign, Federal, state,
provincial, local or municipal laws, rules, guidelines, orders,
regulations, statutes, ordinances, codes, decrees, requirements of any
Governmental Authority or other Requirements of Law (including common law)
regulating, relating to or imposing liability or standards of conduct
concerning protection of employee health and safety or the environment, as
now or may at any time hereafter be in effect.
"ERISA": the Employee Retirement Income Security Act of 1974, as
amended from time to time.
11
"EUROCURRENCY RESERVE REQUIREMENTS": for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates
(expressed as a decimal fraction) of reserve requirements in effect on such
day (including, without limitation, basic, supplemental, marginal and
emergency reserves under any regulations of the Board of Governors of the
Federal Reserve System or other Governmental Authority having jurisdiction
with respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities"
in Regulation D of such Board) maintained by a member bank of such System.
"EURODOLLAR BASE RATE": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum equal to the
rate at which Chase is offered Dollar deposits at or about 10:00 A.M., New
York City time, two Business Days prior to the beginning of such Interest
Period in the interbank eurodollar market where the eurodollar and foreign
currency and exchange operations in respect of its Eurodollar Loans are
then being conducted for delivery on the first day of such Interest Period
for the number of days comprised therein and in an amount comparable to
the amount of its Eurodollar Loan to be outstanding during such Interest
Period.
"EURODOLLAR LOANS": Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
"EURODOLLAR RATE": with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upward to the
nearest 1/100th of 1%):
EURODOLLAR BASE RATE
1.00 - Eurocurrency Reserve Requirements
"EVENT OF DEFAULT": any of the events specified in Section 8,
PROVIDED that any requirement for the giving of notice, the lapse of time,
or both, or any other condition, has been satisfied.
"EXCESS CASH FLOW": for any fiscal year of the Borrower, commencing
with the fiscal year ending December 31, 1996, the excess of (a) the sum,
without duplication, of (i) Consolidated EBITDA of the Borrower for such
fiscal year, (ii) the amount of any refund received by the Borrower and its
Subsidiaries during such fiscal year on income taxes paid by the Borrower
and its Subsidiaries to the extent not included in Consolidated EBITDA for
such fiscal year, (iii) cash dividends, cash interest and other similar
cash payments received by the Borrower during such fiscal year in respect
of investments to the extent not included in Consolidated EBITDA for such
fiscal year, (iv) extraordinary cash gains to the extent subtracted or
otherwise not included in Consolidated EBITDA for such fiscal year, (v)
decreases in Consolidated Working Capital (other than decreases in cash or
US or Canadian Cash Equivalents) over (b) the sum, without duplication, of
(i) the aggregate amount of capital expenditures on a consolidated basis
made by the Borrower and its Subsidiaries during such fiscal year and not
financed, (ii) the aggregate amount of all reductions of the Revolving
Credit Commitments (to the extent such reductions are required by the terms
of this Agreement to be accompanied by prepayment of Revolving Credit
12
Loans) or payments or prepayments of the Term Loans during such fiscal year
other than pursuant to subsection 2.9(a), (b), (c) or (d), (iii) the
aggregate amount of payments of principal of in respect of any Indebtedness
(other than under this Agreement) permitted hereunder during such fiscal
year (other than in respect of Existing Subordinated Debt), (iv)
Consolidated Cash Interest Expense of the Borrower for such fiscal year,
(v) the fees described in subsections 2.3 and 3.3 and the fees and expenses
incurred in connection with the Recapitalization and the financing thereof
and in connection with the offering of the High Yield Notes, (vi) taxes
actually paid in such fiscal year or to be paid in the subsequent fiscal
year on account of such fiscal year to the extent added to Consolidated Net
Income to determine Consolidated EBITDA for such fiscal year, (vii)
extraordinary cash payments or losses to the extent not subtracted in the
determination of Consolidated EBITDA for such fiscal year, (viii) payments
made by the Borrower or its Subsidiaries in respect of pension and other
retirement benefits (to the extent not included in Consolidated EBITDA) and
cash payments made to customers at the commencement of multi-year supply
contracts (to the extent not included in Consolidated EBITDA), (ix) the
aggregate amount of cash used for Permitted Acquisitions made by the
Borrower during such fiscal year, and (x) increases in Consolidated Working
Capital (other than increases in cash or US or Canadian Cash
Equivalents).
"EXISTING CREDIT FACILITY": the Credit Agreement, dated as of March
2, 1995 among the Borrower, the lenders named therein, Citibank, N.A., as
U.S. and Canadian Issuing Bank, Citicorp USA, Inc., as Agent and Swing Line
Bank and Citicorp Securities, Inc., as arranger, as heretofore amended,
supplemented or otherwise modified.
"EXISTING SUBORDINATED DEBT": Indebtedness of the Borrower evidenced
by promissory notes issued to the Shareholders on the date hereof in an
aggregate principal amount not to exceed $25 million, which Indebtedness
shall be subordinated in all respects to all amounts due and owing to the
Administrative Agent and the Lenders under this Agreement and the other
Loan Documents in form and substance satisfactory to the Administrative
Agent and the Lenders in all respects as contemplated pursuant to the
Recapitalization Documents.
"FINANCING LEASE": any lease of property, real or personal, the
obligations of the lessee in respect of which are required in accordance
with GAAP to be capitalized on a balance sheet of the lessee.
"GAAP": generally accepted accounting principles in the United States
of America in effect from time to time.
"GOVERNMENTAL AUTHORITY": any nation or government, any state,
province or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of
or pertaining to government.
"GUARANTEE OBLIGATION": as to any Person (the "GUARANTEEING PERSON"),
any obligation of (a) the guaranteeing person or (b) another Person
(including, without limitation, any bank under any letter of credit) to
induce the creation of which the guaranteeing person has issued a
reimbursement, counterindemnity or similar obligation, in either case
guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends
or other obligations (the "PRIMARY OBLIGATIONS") of any other third Person
(the "PRIMARY OBLIGOR") in any manner, whether directly or indirectly,
including, without limitation, any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or
any property constituting direct or indirect security therefor, (ii) to
advance or supply funds (1) for the purchase or payment of any such primary
obligation or (2) to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services
primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such
primary obligation or (iv) otherwise to assure or hold harmless the owner
of any such primary obligation against loss in respect thereof; PROVIDED,
HOWEVER, that the term Guarantee Obligation shall not include endorsements
of instruments for deposit or collection in the ordinary course of
business. The amount of any Guarantee Obligation of any guaranteeing
person shall be deemed to be the lower of (a) an amount equal to the stated
or determinable amount of the primary obligation in respect of which such
Guarantee Obligation is made and (b) the maximum amount for which such
guaranteeing person may be liable pursuant to the terms of the instrument
embodying such Guarantee Obligation, unless such primary obligation and the
maximum amount for which such guaranteeing person may be liable are not
stated or determinable, in which case the amount of such Guarantee
Obligation shall be such guaranteeing person's maximum reasonably
anticipated liability in respect thereof as determined by the Borrower in
good faith.
"GUARANTOR": any Person delivering the Subsidiaries Guarantee
pursuant to this Agreement.
"HEDGE AGREEMENTS": means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"HIGH YIELD NOTES": as defined in subsection 7.2(h).
"INDEBTEDNESS": of any Person at any date, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of
property or services (other than current trade liabilities incurred in the
ordinary course of business and payable in accordance with customary
practices), (b) any other indebtedness of such Person which is evidenced by
a note, bond, debenture or similar instrument, (c) all obligations of such
Person under Financing Leases, (d) all obligations of such Person in
respect of outstanding letters of credit, acceptances and similar
obligations created for the account of such Person, (e) all obligations of
such Person under Hedge Agreements and (f) all liabilities secured by any
Lien on any property owned by such Person even though such Person has not
assumed or otherwise become liable for the payment thereof.
"INSOLVENCY": with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
14
"INSOLVENT": pertaining to a condition of Insolvency.
"INSTALLMENT PAYMENT DATE": as defined in subsection 2.7(a).
"INTELLECTUAL PROPERTY": the collective reference to Copyrights,
Copyright Licenses, Patents, Patent Licenses, Trademarks and Trademark
Licenses, in each case, as defined in the Security Agreement.
"INTEREST EXPENSE": of any Person for any period the amount of
interest expense, both expensed and capitalized, of such Person, determined
on a consolidated basis in accordance with GAAP, for such period on the
aggregate principal amount of its Indebtedness.
"INTEREST PAYMENT DATE": (a) as to any ABR Loan, the last day of each
March, June, September and December, (b) as to any Eurodollar Loan having
an Interest Period of three months or less, the last day of such Interest
Period, and (c) as to any Eurodollar Loan having an Interest Period longer
than three months, each day which is three months or a whole multiple
thereof, after the first day of such Interest Period and the last day of
such Interest Period.
"INTEREST PERIOD": with respect to any Eurodollar Loan:
(i) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such Eurodollar
Loan and ending one, two, three or six months thereafter, as selected
by the Borrower in its notice of borrowing or notice of conversion, as
the case may be, given with respect thereto; and
(ii) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan and
ending one, two, three or six months thereafter, as selected by the
Borrower by irrevocable notice to the Administrative Agent not less
than three Business Days prior to the last day of the then current
Interest Period with respect thereto;
PROVIDED that, all of the foregoing provisions relating to Interest Periods
are subject to the following:
(1) if any Interest Period would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be
to carry such Interest Period into another calendar month in which
event such Interest Period shall end on the immediately preceding
Business Day;
(2) any Interest Period that would otherwise extend beyond the
Termination Date or, in the case of Interest Periods applicable to
Term Loans, beyond the date final payment is due on the Term Loans
shall end on the Termination Date or such date of final payment, as
the case may be;
15
(3) any Interest Period that begins on the last Business Day of
a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest
Period) shall end on the last Business Day of a calendar month; and
(4) the Borrower shall select Interest Periods so as not to
require a payment or prepayment of any Eurodollar Loan during an
Interest Period for such Loan.
"INTERIM ADJUSTMENTS": means, that for the first three fiscal
quarters following the Closing Date, the ratio to be calculated pursuant to
subsection 7.1(e) which ratio shall be calculated using the adjustments and
assumptions regarding Cash Interest Expense set forth below:
(i) for the partial fiscal quarter ending September 30, 1996,
Cash Interest Expense for the twelve month period for which the ration
is being calculated shall be deemed to be the result obtained by
adding (x) the actual Cash Interest Expense for the period from the
Closing Date through the last day of such fiscal quarter and (y)
$11,100,000, (ii) for the full fiscal quarter ending December 31,
1996, Cash Interest Expense for the twelve month period for which the
ratio is being calculated shall be deemed to be the result obtained by
adding (x) the actual Cash Interest Expense for the period from the
Closing Date through the last day of such fiscal quarter and (y)
$7,400,000 and (iii) for the full fiscal quarter ending March 31,
1997, Cash Interest Expense for the twelve month period for which the
ratio is being calculated shall be deemed to be the result obtained by
adding (x) the actual Cash Interest Expense for the period from the
Closing Date through the last day of such fiscal quarter and (y)
$3,700,000.
"INVENTORY": as defined in Section 9-109(4) of the UCC.
"INVENTORY RESERVE": with respect to any Inventory of the Borrower
and its Subsidiaries, determined on a first in first out basis in
accordance with GAAP and stated on a basis consistent with the historical
practices of the Borrower on the date hereof, which intent is to record a
deterioration in Inventory value for damaged, unsalable in the ordinary
course or otherwise unmerchantable items or which have been held for more
than six months in the case of Tobacco Products Inventory or more than
twelve months in the case of other Inventory or is stale.
"ISSUING BANK": Chase or an Affiliate of Chase designated by it, in
its capacity as issuer of any Letter of Credit; initially, Chase Manhattan
Bank Delaware.
"LANDLORD LIEN RESERVES": at any time, the aggregate amount of any
and all past due and current amounts then owing by the Borrower and its
Subsidiaries to landlords in respect of their warehouse facilities.
"L/C COMMITMENT": at any date of determination the lesser of
$40,000,000 and Revolving Credit Commitments at such date.
16
"L/C FEE PAYMENT DATE": the last day of each March, June, September,
and December, and the Termination Date.
"L/C OBLIGATIONS": at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters
of Credit and (b) the aggregate amount of drawings under Letters of Credit
which have not then been reimbursed pursuant to subsection 3.5(a).
"L/C PARTICIPANTS": the collective reference to all the Lenders with
Revolving Credit Commitments other than the Issuing Bank.
"LEASE EXPENSE": for any Person for any period, the aggregate amount
of fixed and contingent rentals payable by such Person for such period with
respect to leases of real and personal property.
"LETTERS OF CREDIT": as defined in subsection 3.1(a).
"LIEN": any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other
security interest or any preference, priority or other security agreement
or preferential arrangement of any kind or nature whatsoever (including,
without limitation, any conditional sale or other title retention agreement
and any Financing Lease having substantially the same economic effect as
any of the foregoing).
"LOAN": any loan made by any Lender pursuant to this Agreement.
"LOAN DOCUMENTS": this Agreement, any Notes, the Applications, any
Letters of Credit, the Subsidiaries Guarantee and the Security Documents
"LOAN PARTIES": the Borrower and each Subsidiary of the Borrower
which is a party to a Loan Document.
"MAJORITY LENDERS": at any time, Lenders the Voting Percentages of
which aggregate more than 50%.
"MATERIAL ADVERSE EFFECT": a material adverse effect on (a) the
business, assets, property, condition (financial or otherwise) or prospects
of the Borrower and its Subsidiaries taken as a whole or (b) the validity
or enforceability of this or any of the other Loan Documents or the rights
or remedies of the Administrative Agent or the Lenders hereunder or
thereunder.
"MATERIALS OF ENVIRONMENTAL CONCERN": any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as
such in or under any Environmental Law, including, without limitation,
asbestos, polychlorinated biphenyls and urea-formaldehyde insulation.
17
"MULTIEMPLOYER PLAN": a Plan which is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
"NET INCOME": of any Person for any period, net income of such Person,
determined on a consolidated basis in accordance with GAAP.
"NET PROCEEDS": (a) with respect to any sale, lease or other
disposition of assets (other than Inventory sold, leased or otherwise
disposed of in the ordinary course of business) aggregating $500,000 or
more by the Borrower or any of its Subsidiaries, the net amount equal to
the aggregate amount received in cash (including any cash received by way
of deferred payment pursuant to a note receivable, other non-cash
consideration or otherwise, but only as and when such cash is so received)
in connection with such sale or other disposition MINUS the sum of (i) the
reasonable and documented fees, commissions and other out-of-pocket
expenses (including, without limitation, fees and expenses of attorneys,
accountants, appraisers, title examiners, service companies and
environmental consultants) incurred by the Borrower and its Subsidiaries
and payable to Persons other than Affiliates in connection with such sale
or other disposition (including, in connection with the repayment or
amendment of any Indebtedness which is secured in whole or in part by such
assets) and (ii) federal, state, local and foreign taxes incurred by the
Borrower and its Affiliates in connection with such sale;
(b) with respect to any issuance of any Indebtedness by the Borrower,
the net amount equal to the aggregate amount received in cash (including
any cash received by way of deferred payment pursuant to a note receivable,
other non-cash consideration or otherwise, but only as and when such cash
is so received) in connection with such issuance MINUS the reasonable and
documented fees, commissions and other out-of-pocket expenses incurred by
the Borrower in connection with such issuance; and
(c) with respect to proceeds received by the Borrower or any of its
Subsidiaries from any insurance policies as a result of a casualty, the
amount of such proceeds MINUS the reasonable and documented out-of-pocket
fees and expenses incurred by the Borrower and its Subsidiaries in
connection with the collection of such proceeds.
"NET WORTH": means, with respect to any Person as of any date of
determination, the stockholder's equity of such Person as of such date,
without giving effect to any cumulative gains or losses from foreign
currency translations PLUS minority interests of such Person as of such
date, in each case determined on a Consolidated basis and in accordance
with GAAP using the first-in, first-out inventory valuation method
(excluding any additional minimum pension liability).
"NON-EXCLUDED TAXES": as defined in subsection 2.17.
"NOTES": the collective reference to the Revolving Credit Notes and
the Term Notes.
18
"OVERADVANCE AMOUNT": at any date of determination the excess, if
any, of the Aggregate Covered Outstanding Revolving Extensions of Credit
over the Borrowing Base at such date.
"OVERADVANCE LIMIT": $10,000,000 as such amount may be reduced
pursuant to subsection 2.9(f).
"PARTICIPANT": as defined in subsection 10.6(b).
"PBGC": the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA.
"PERMITTED ACQUISITION": shall mean any acquisition of all or
substantially all the assets of, or shares or other equity interests in, a
Person or division or line of business of a Person or other significant
assets of a Person (other than inventory, leases, materials and equipment
in the ordinary course of business) if immediately after giving effect
thereto: (a) no Default or Event of Default shall have occurred and be
continuing or would result therefrom, (b) all transactions related thereto
shall be consummated in all material respects in accordance with applicable
laws, (c) 100% of the Capital Stock of any acquired or newly formed
corporation, partnership, association or other business entity are owned
directly by the Borrower or a Subsidiary and all actions required to be
taken, if any, with respect to such acquired or newly formed subsidiary
under subsections 6.10 and 6.12 shall have been taken, (d)(i) the Borrower
shall be in compliance, on a PRO FORMA basis after giving effect to such
acquisition or formation, with the covenants contained in subsection 7.1
recomputed as at the last day of the most recently ended fiscal quarter of
the Borrower as if such acquisition had occurred on the first day of each
relevant period for testing such compliance, and the Borrower shall have
delivered to the Administrative Agent a certificate of a Responsible
Officer to such effect, together with all relevant financial information
for such subsidiary or assets (to the extent reasonably available), and
(ii) after giving effect to such transaction, any acquired or newly formed
subsidiary shall not be liable for any Indebtedness (except for
Indebtedness permitted by subsection 7.2) and (e) the Borrower shall have
delivered to the Administrative Agent monthly projections on a PRO FORMA
basis after giving effect to such acquisition or formation, for each of the
twelve months following the proposed date of such acquisition or formation,
which projections shall indicate that (i) the Borrower would be in
compliance with the covenants contained in subsection 7.1 recomputed as of
the last day of the most recently ended month as if such acquisition had
occurred on the first day of each month for testing such compliance and
(ii) the average amount of the lesser of (1) the available Borrowing Base
and (2) the Available Revolving Credit Commitments shall be at least
$15,000,000 during such 12 month period and the Borrower shall have
delivered to the Administrative Agent a certificate of a Responsible
Officer to such effect, PROVIDED, that clauses (d)(i) and (e) above shall
not apply to any acquisition the aggregate amount of which is less than
$2,000,000 unless and until all such acquisitions which are less than
$2,000,000 exceed $5 million in the aggregate during the term of this
Agreement.
19
"PERSON": an individual, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture,
Governmental Authority or other entity of whatever nature.
"PLAN": at a particular time, any employee benefit plan which is
covered by ERISA and in respect of which the Borrower or a Commonly
Controlled Entity is (or, if such plan were terminated at such time, would
under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA.
"PROPERTIES": as defined in subsection 4.17.
"RECAPITALIZATION": The resulting ownership of the Borrower after the
consummation of the transactions contemplated by Recapitalization
Documents.
"RECAPITALIZATION DOCUMENTS": the Stock Subscription Agreement by and
between CM/J Acquisition, LLC and Core-Xxxx International, Inc., dated
June 17, 1996, as amended by Amendment No. 1 thereto, dated as of August 7,
1996 (the "Stock Subscription Agreement") and the Company/LLC Purchase
Agreement as defined in the Stock Subscription Agreement.
"RECEIVABLE OFFSETS": the aggregate credit balances of the Borrower
(determined on an account debtor by account debtor basis) more than 45 days
past due.
"REGISTER": as defined in subsection 10.6(d).
"REGULATION U": Regulation U of the Board of Governors of the Federal
Reserve System as in effect from time to time.
"REIMBURSEMENT OBLIGATION": the obligation of the Borrower to
reimburse the Issuing Bank pursuant to subsection 3.5(a) for amounts drawn
under Letters of Credit.
"REORGANIZATION": with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section
4241 of ERISA.
"REPORTABLE EVENT": any of the events set forth in Section 4043(b) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .13, .14, .16, .18, .19 or .20 of PBGC Reg. 2615
or other PBGC regulations or guidance.
"REQUIREMENT OF LAW": as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of
such Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to
which such Person or any of its property is subject.
20
"RESPONSIBLE OFFICER": the chief executive officer, the president, or
the executive vice president of the Borrower or, with respect to financial
matters, the chief financial officer, the treasurer or the Controller of
the Borrower.
"RESPONSIBLE OFFICER'S CERTIFICATE": as defined in subsection 6.2(b).
"REVOLVING CREDIT COMMITMENT": as to any Lender, the obligation of
such Lender to make Revolving Credit Loans to and/or issue or participate
in Letters of Credit issued on behalf of the Borrower hereunder in an
aggregate principal and/or face amount at any one time outstanding not to
exceed the amount set forth opposite such Lender's name on Schedule 1.1(a)
under the heading "Revolving Credit Commitment", as such amount may be
reduced from time to time pursuant to this Agreement or as such amount may
be adjusted from time to time pursuant to subsection 10.6; collectively, as
to all such Lenders, the "Revolving Credit Commitments".
"REVOLVING CREDIT COMMITMENT PERCENTAGE": as to any Lender (a) at any
time prior to the termination of the Revolving Credit Commitments, the
percentage of the Revolving Credit Commitments then constituted by such
Lender's Revolving Credit Commitment and (b) at any time after the
termination of the Revolving Credit Commitments, the percentage which (i)
the sum of (x) such Lender's Revolving Credit Loans then outstanding plus
(y) the product of such Lender's Revolving Credit Commitment Percentage
immediately prior to the termination of the Revolving Credit Commitments
(after giving effect to any permitted assignment pursuant to subsection
10.6) times the L/C Obligations then outstanding then constitutes of (ii)
the sum of (x) the aggregate principal amount of Revolving Credit Loans of
all the Lenders then outstanding plus (y) the aggregate L/C Obligations
then outstanding.
"REVOLVING CREDIT LOANS": as defined in subsection 2.1.
"REVOLVING CREDIT NOTE": as defined in subsection 2.7(e).
"SECURITY AGREEMENT": the Security Agreement to be executed and
delivered by the Borrower and each of the Subsidiaries, substantially in
the form of Exhibit C, as the same may be amended, supplemented or
otherwise modified from time to time.
"SECURITY DOCUMENTS": the collective reference to the Security
Agreement, the Borrower Stock Pledge Agreement and all other security
documents hereafter delivered to the Administrative Agent granting a Lien
on any asset or assets of any Person to secure the obligations and
liabilities of the Borrower hereunder and under any of the other Loan
Documents or to secure any guarantee of any such obligations and
liabilities.
"SENIOR DEBT": at any date of determination, Total Debt of the
Borrower and its Subsidiaries outstanding at such date of determination
minus all Subordinated Debt (including, without limitation, the Existing
Subordinated Debt) of the Borrower and its Subsidiaries outstanding at such
date of determination, as determined on a consolidated basis in accordance
with GAAP.
21
"SHAREHOLDERS": the Shareholders of the Borrower subsequent to the
Recapitalization, including, Jupiter Partners, L.P., a Delaware limited
partnership, Xxxx X. Xxxxx, Xxxxxx X. Xxxxx, Xxx X. Xxxxxx, J. Xxxxxxx
Xxxxx, Xxxxx X. Xxxxxx and Xxx Xxxxxxxx.
"SINGLE EMPLOYER PLAN": any Plan which is covered by Title IV of
ERISA, but which is not a Multiemployer Plan.
"SOLVENT": when used with respect to any Person, means that, as of
any date of determination, (a) the amount of the "present fair saleable
value" of the assets of such Person will, as of such date, exceed the
amount of all "liabilities of such Person, contingent or otherwise", as of
such date, as such quoted terms are determined in accordance with
applicable federal and state laws governing determinations of the
insolvency of debtors, (b) the present fair saleable value of the assets of
such Person will, as of such date, be greater than the amount that will be
required to pay the liability of such Person on its debts as such debts
become absolute and matured, (c) such Person will not have, as of such
date, an unreasonably small amount of capital with which to conduct its
business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) "debt" means liability on a "claim",
and (ii) "claim" means any (x) right to payment, whether or not such a
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured or (y) right to an equitable remedy for breach of performance if
such breach gives rise to a right to payment, whether or not such right to
an equitable remedy is reduced to judgment, fixed, contingent, matured or
unmatured, disputed, undisputed, secured or unsecured.
"SPOT RATE": the rate of exchange quoted by the Administrative Agent
on such date of determination (at the hour on such date of determination at
which it customarily makes such determination) to prime banks in the
interbank market where its foreign currency exchange operations in respect
of Canadian Dollars are then being conducted for the spot purchase of
Canadian Dollars with Dollars.
"STANDBY LETTER OF CREDIT": as defined in subsection 3.1(b)(1)(A).
"SUBORDINATED DEBT": any unsecured Indebtedness of the Borrower no
part of the principal of which is required to be paid (whether by way of
mandatory sinking fund, mandatory redemption, mandatory prepayment or
otherwise) prior to July 1, 2001; the payment of the principal of and
interest on which and other obligations of the Borrower in respect thereof
are subordinated to the prior payment in full of the principal of and
interest (including post-petition interest) on the Loans and all other
obligations and liabilities of the Borrower to the Administrative Agent and
the Lenders hereunder on terms and conditions approved in writing by the
Administrative Agent; and all other terms and conditions of which are
satisfactory in form and substance to the Administrative Agent.
"SUBSIDIARIES GUARANTEE": the Guarantee to be executed and
delivered by each Subsidiary, substantially in the form of Exhibit E, as
the same may be amended, supplemented or otherwise modified from time
to time.
22
"SUBSIDIARY": as to any Person, a corporation, partnership or other
entity of which shares of stock or other ownership interests having
ordinary voting power (other than stock or such other ownership interests
having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through
one or more intermediaries, or both, by such Person. Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to C/M Products, CMIC and/or CM Midcontinent, the
only active Subsidiaries of the Borrower.
"SUPPLEMENTAL REPORTING": the reports, accounting records and
analyses delivered by the Borrower to the Administrative Agent pursuant to
subsection 6.2(f) and certified by a Responsible Officer, as described in
Exhibit I.
"TAX RESERVES": at any time, all unpaid and unbonded state and local
municipality tax stamp liabilities.
"TERMINATION DATE": June 30, 2001.
"TERM LOAN": as defined in subsection 2.5.
"TERM LOAN COMMITMENT": as to any Lender, its obligation to make a
Term Loan to the Borrower in an amount equal to the amount set forth
opposite such Lender's name in Schedule 1.1(a) under the heading "Term Loan
Commitment", as such amount may be reduced from time to time pursuant to
this Agreement or as such amount may be adjusted from time to time pursuant
to subsection 10.6; collectively, as to all such Lenders, the "Term Loan
Commitments".
"TERM LOAN COMMITMENT PERCENTAGE": as to any Lender at any time, the
percentage of the Term Loan Commitments then constituted by such Lender's
Term Loan Commitment (or, after the Term Loans are made, the percentage of
the aggregate Term Loans then constituted by such Lender's Term Loan).
"TERM NOTE": as defined in subsection 2.7(e).
"TOBACCO AND CIGAR INVENTORY": the cigar, chewing tobacco and other
tobacco products Inventory of the Borrower and its Subsidiaries in respect
thereof (excluding items classified as Cigarette Inventory).
"TOBACCO PRODUCTS INVENTORY": collectively, Cigarette Inventory and
Tobacco and Cigar Inventory.
"TOTAL DEBT": at any date of determination, all Indebtedness of the
Borrower and its Subsidiaries outstanding at such date of determination
(other than Indebtedness of the type set forth in clauses (d) (with respect
to letters of credit only), (e) and (f) in the definition thereof in
subsection 1.1) as determined on a consolidated basis in accordance
with GAAP.
23
"TRANCHE": the collective reference to Eurodollar Loans the then
current Interest Periods with respect to all of which begin on the same
date and end on the same later date (whether or not such Loans shall
originally have been made on the same day).
"TRANSFEREE": as defined in subsection 10.6(f).
"TYPE": as to any Loan, its nature as an ABR Loan or a Eurodollar
Loan.
"UCC": the Uniform Commercial Code as in effect in the State of New
York from time to time.
"UNCLEARED US CHECKS": at a particular date, uncollected funds held
to the account of the Borrower in the Depository Accounts in respect of
checks deposited therein but only to the extent that such checks have been
deducted from accounts receivable on the books of the Borrower.
"UNCOVERED L/C AMOUNT": $20,000,000 as such amount may be reduced in
accordance with subsection 2.9(f).
"UNIFORM CUSTOMS": the Uniform Customs and Practice for Documentary
Credits (1993 Revision), International Chamber of Commerce Publication No.
500, as the same may be amended from time to time.
"US CASH COLLATERAL ACCOUNT": has the meaning specified in the
Security Agreement.
"US CASH EQUIVALENTS": (a) securities with maturities of one year or
less from the date of acquisition issued or fully guaranteed or insured by
the United States Government or any agency thereof, (b) certificates of
deposit and eurodollar time deposits with maturities of one year or less
from the date of acquisition and overnight bank deposits of any Lender or
of any commercial bank having capital and surplus in excess of
$500,000,000, (c) repurchase obligations of any Lender or of any commercial
bank satisfying the requirements of clause (b) of this definition, having a
term of not more than 30 days with respect to securities issued or fully
guaranteed or insured by the United States Government, (d) commercial paper
of a domestic issuer rated at least A-2 by Standard and Poor's Rating Group
("S&P") or P-2 by Xxxxx'x Investors Service, Inc. ("MOODY'S"), (e)
securities with maturities of one year or less from the date of acquisition
issued or fully guaranteed by any state, commonwealth or territory of the
United States, by any political subdivision or taxing authority of any such
state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory, political subdivision,
taxing authority or foreign government (as the case may be) are rated at
least A by S&P or A by Moody's, (f) securities with maturities of one year
or less from the date of acquisition backed by standby letters of credit
issued by any Lender or any commercial bank satisfying the requirements of
clause (b) of this definition or (g) shares of money market mutual or
similar funds which invest primarily in assets satisfying the requirements
of clauses (a) through (f) of this definition.
24
"VENDOR RECEIVABLES": at a particular date, amounts not subject to
offset or counter-claim, that are owing to the Borrower and its
Subsidiaries from vendors whose creditworthiness is reasonably satisfactory
to the Administrative Agent, that relate to marketing and promotional
incentive programs and manufacturing rights agreements historically offered
to the Borrower and its Subsidiaries from such vendors and are payable in
cash.
"VOTING PERCENTAGE": as to any Lender (a) at any time prior to the
termination of the Revolving Credit Commitments, the percentage which (i)
the sum of (x) such Lender's Revolving Credit Commitment plus (y) the
outstanding principal amount of such Lender's Term Loan then constitutes of
(ii) the sum of (x) the Revolving Credit Commitments of all the Lenders
plus (y) the aggregate principal amount of Term Loans of all the Lenders
then outstanding, and (b) at any time after the termination of the
Revolving Credit Commitments, the percentage which (i) the sum of (x) the
principal amount of such Lender's Loans then outstanding plus (y) the
product of such Lender's Revolving Credit Commitment Percentage times the
L/C Obligations then outstanding then constitutes of (ii) the sum of (x)
the aggregate principal amount of Loans of all the Lenders then outstanding
plus (y) the aggregate L/C Obligations of all the Lenders then outstanding.
1.2 OTHER DEFINITIONAL PROVISIONS. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in any Notes or any certificate or other document made or delivered
pursuant hereto.
(b) As used herein and in any Notes, and any certificate or other
document made or delivered pursuant hereto, accounting terms relating to the
Borrower and its Subsidiaries not defined in subsection 1.1 and accounting terms
partly defined in subsection 1.1, to the extent not defined, shall have the
respective meanings given to them under GAAP.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section, subsection,
Schedule and Exhibit references are to this Agreement unless otherwise
specified.
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
(e) Notwithstanding anything to the contrary herein, for purposes of
making all calculations in connection with the covenants contained in Section 7,
all accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP as in effect on
the date of this Agreement consistently applied. In the event of any material
difference at any time between GAAP in effect on the date of this Agreement and
GAAP from time to time in effect, the certificate of a Responsible Officer
required pursuant to subsection 6.2(b) shall include a reconciliation of the
calculations required thereby with the financial statements being delivered with
such certificate.
25
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
2.1 REVOLVING CREDIT COMMITMENTS. (a) Subject to the terms and
conditions hereof, each Lender severally agrees to make revolving credit
loans ("REVOLVING CREDIT LOANS") to the Borrower from time to time during
the Commitment Period in an aggregate principal amount at any one time
outstanding which, when added to such Lender's Revolving Credit Commitment
Percentage of the then outstanding L/C Obligations, does not exceed the
amount of such Lender's Revolving Credit Commitment, provided that no
Lender shall be required to make a Revolving Credit Loan to the extent
that, after giving effect thereto, the Aggregate Covered Outstanding
Revolving Extensions of Credit at such time would exceed the sum of the
Borrowing Base and the Overadvance Limit at such time. During the
Commitment Period the Borrower may use the Revolving Credit Commitments by
borrowing, prepaying the Revolving Credit Loans in whole or in part, and
reborrowing, all in accordance with the terms and conditions hereof.
(b) The Revolving Credit Loans may from time to time be (i)
Eurodollar Loans, (ii) ABR Loans, or (iii) a combination thereof, as
determined by the Borrower and notified to the Administrative Agent in
accordance with subsections 2.2 and 2.11, PROVIDED that no Revolving Credit
Loan shall be made as a Eurodollar Loan after the day that is one month
prior to the Termination Date.
2.2 PROCEDURE FOR REVOLVING CREDIT BORROWING. The Borrower may
borrow under the Revolving Credit Commitments during the Commitment Period
on any Business Day, provided that the Borrower shall give the
Administrative Agent irrevocable notice which notice must be received by
the Administrative Agent prior to 1:00 P.M., New York City time, (a) three
Business Days prior to the requested Borrowing Date, if all or any part of
the requested Revolving Credit Loans are to be initially Eurodollar Loans
(provided that any borrowing to be made on the Closing Date may only be ABR
Loans), or (b) on the requested Borrowing Date, otherwise (or, in the case
of a requested borrowing on the Closing Date, on the Closing Date),
specifying (i) the amount to be borrowed, (ii) the requested Borrowing
Date, (iii) whether the borrowing is to be of Eurodollar Loans, ABR Loans
or a combination thereof, (iv) whether such Loans will result in an
Overadvance Amount and (v) if the borrowing is to be entirely or partly of
Eurodollar Loans, the amount of such Loan and the length of the initial
Interest Period therefor. Each borrowing under the Commitments shall be in
an amount equal to (x) in the case of ABR Loans, $500,000 or a whole
multiple of $100,000 in excess thereof (or, if the then Available Revolving
Credit Commitments are less than $500,000, such lesser amount) and (y) in
the case of Eurodollar Loans, $1,000,000 or a whole multiple of $100,000 in
excess thereof. Upon receipt of any such notice from the Borrower, the
Administrative Agent shall promptly notify each Lender thereof. Each
Lender will make the amount of its pro rata share of each borrowing
available to the Administrative Agent for the account of the Borrower at
the office of the Administrative Agent specified in subsection 10.2 prior
to 2:30 P.M., New York City time, on the Borrowing Date requested by the
Borrower in funds immediately available to the Administrative Agent. Such
borrowing will then be made available to the Borrower by the Administrative
Agent crediting the account of the Borrower on the books of such office
with the aggregate of the amounts made available to the Administrative
Agent by the Lenders and in like funds as received by the Administrative
Agent.
26
2.3 FEES. (a) The Borrower agrees to pay to the Administrative
Agent for the account of each Lender a commitment fee for the period from
and including the first day of the Commitment Period to the Termination
Date, computed at the rate of 1/2 of 1% per annum on the average daily
amount of the Available Revolving Credit Commitment of such Lender during
the period for which payment is made, payable quarterly in arrears on the
last day of each March, June, September and December and on the Termination
Date or such earlier date as the Commitments shall terminate as provided
herein, commencing on the first of such dates to occur after the date
hereof.
(b) The Borrower agrees to pay to the Administrative Agent on
the Closing Date and on each anniversary thereof, the administration fee as
specified in the Fee Letter dated July 3, 1996.
2.4 TERMINATION OR REDUCTION OF COMMITMENTS. The Borrower shall
have the right, upon not less than five Business Days' notice to the
Administrative Agent, to terminate the Commitments or, from time to time,
to reduce the amount of the Commitments provided that no such termination
or reduction shall be permitted if, after giving effect thereto and to any
prepayments of the Revolving Credit Loans made on the effective date
thereof, the Aggregate Outstanding Revolving Extensions of Credit would
exceed the Revolving Credit Commitments then in effect. Any such reduction
shall be in an amount equal to $100,000 or a whole multiple thereof and
shall reduce permanently the Revolving Credit Commitments then in effect.
2.5 TERM LOANS. Subject to the terms and conditions hereof,
each Lender severally agrees to make a term loan (a "TERM LOAN") to the
Borrower on the Closing Date in an amount equal to the Term Loan Commitment
of such Lender. The Term Loans may from time to time be (a) Eurodollar
Loans, (b) ABR Loans, or (c) a combination thereof, as determined by the
Borrower and notified to the Administrative Agent in accordance with
subsections 2.6 and 2.11.
2.6 PROCEDURE FOR TERM LOAN BORROWING. The Borrower hereby
requests a Term Loan borrowing on the Closing Date in an amount equal to
the aggregate amount of the Term Loan Commitments of the Lenders. The Term
Loans shall initially be ABR Loans. Each Lender will make the amount of
its pro rata share of the Term Loans available to the Administrative Agent
for the account of the Borrower at the office of the Administrative Agent
specified in subsection 10.2 prior to 10:00 A.M., New York City time, on
the Closing Date in Dollars and in funds immediately available to the
Administrative Agent. The Administrative Agent shall credit the account of
the Borrower on the books of such office of the Administrative Agent by
12:00 noon, New York City time, on the Closing Date, with the aggregate of
the amounts made available to the Administrative Agent by the Lenders and
in like funds as received by the Administrative Agent.
2.7 REPAYMENT OF LOANS; EVIDENCE OF DEBT. (a) The Borrower
hereby unconditionally promises to pay to the Administrative Agent for the
account of each Lender (i) the then unpaid principal amount of each
Revolving Credit Loan of such Lender on the Termination Date (or such
earlier date on which the Revolving Credit Loans become due and payable
pursuant to Section 8), and (ii) the principal amount of the Term Loan of
such Lender, in eighteen (18) consecutive quarterly installments (each, an
"Installment Payment
27
Date"), payable on the last day of each March, June, September and
December, commencing on March 31, 1997 in an amount equal to such Lender's
Term Loan Commitment Percentage of the following amounts:
Installment Payment Date Amount of Installment
------------------------ ---------------------
3/31/97 - 6/30/97 $1,600,000
9/30/97 - 6/30/98 $1,800,000
9/30/98 - 6/30/2000 $1,950,000
9/30/00 - 6/30/2001 $2,250,000
(or the then unpaid principal amount of such Term Loan, on the date that
the Term Loans become due and payable pursuant to Section 8). The Borrower
hereby further agrees to pay interest on the unpaid principal amount of the
Loans from time to time outstanding from the date hereof until payment in
full thereof at the rates per annum, and on the dates, set forth in
subsection 2.13.
(b) Each Lender shall maintain in accordance with its usual
practice an account or accounts evidencing indebtedness of the Borrower to
such Lender resulting from each Loan of such Lender from time to time,
including the amounts of principal and interest payable and paid to such
Lender from time to time under this Agreement.
(c) The Administrative Agent shall maintain the Register
pursuant to subsection 10.6(d), and a subaccount therein for each Lender,
in which shall be recorded (i) the amount of each Revolving Credit Loan and
Term Loan made hereunder, the Type thereof and each Interest Period
applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each Lender
hereunder and (iii) both the amount of any sum received by the
Administrative Agent hereunder from the Borrower and each Lender's share
thereof.
(d) The entries made in the Register and the accounts of each
Lender maintained pursuant to subsection 2.7(b), absent manifest error,
shall, to the extent permitted by applicable law, be PRIMA FACIE evidence
of the existence and amounts of the obligations of the Borrower therein
recorded; PROVIDED, HOWEVER, that the failure of any Lender or the
Administrative Agent to maintain the Register or any such account, or any
error therein, shall not in any manner affect the obligation of the
Borrower to repay (with applicable interest) the Loans made to such
Borrower by such Lender in accordance with the terms of this Agreement.
(e) The Borrower agrees that, upon the request to the
Administrative Agent by any Lender, the Borrower will execute and deliver
to such Lender (i) a promissory note of the Borrower evidencing the
Revolving Credit Loans of such Lender, substantially in the form of Exhibit
A with appropriate insertions as to date and principal amount (a "REVOLVING
CREDIT NOTE"), and/or (ii) a promissory note of the Borrower evidencing the
Term Loan of such Lender, substantially in the form of Exhibit B with
appropriate insertions as to date and principal amount (a "TERM NOTE").
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2.8 OPTIONAL PREPAYMENTS. The Borrower may at any time and from
time to time, prepay the Loans, in whole or in part, without premium or
penalty, (i) with respect to Eurodollar Loans, upon at least three Business
Days' irrevocable notice to the Administrative Agent, specifying the date
and amount of prepayment and (ii) with respect to ABR Loans, upon same day
irrevocable notice if such notice is received by the Administrative Agent
by 1:00 P.M., New York City time, on such day, specifying the date and
amount of prepayment; and whether the prepayment is of Eurodollar Loans,
ABR Loans or a combination thereof, and, if of a combination thereof, the
amount allocable to each. Prepayments of Eurodollar Loans shall be subject
to the provisions of subsection 2.20. Upon receipt of any such notice the
Administrative Agent shall promptly notify each Lender thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with any amounts payable
pursuant to subsection 2.20 and, in the case of prepayments of the Term
Loans only, accrued interest to such date on the amount prepaid. Partial
prepayments of the Term Loans shall be applied to the installments of
principal thereof pro rata. Amounts prepaid on account of the Term Loans
may not be reborrowed. Partial prepayments of ABR Loans shall be in an
aggregate principal amount of a minimum of $500,000 and partial prepayments
of Eurodollar Loans shall be in an aggregate principal amount of a minimum
of $1,000,000.
2.9 MANDATORY PREPAYMENTS AND OTHER REDUCTIONS OF TERM LOANS.
(a) On the day upon which any Loan Party receives Net Proceeds
from the issuance of any Indebtedness (other than Indebtedness expressly
permitted pursuant to subsection 7.2(a), (b), (c), (d), (e), (f), (g), (i),
(j), (k), (l), (m) and (n)), the Borrower shall prepay the Term Loans in an
amount equal to the lesser of 100% of the Net Proceeds of such issuance and
the outstanding amount of the Term Loans.
(b) In the event that any Loan Party sells, assigns, transfers,
leases or otherwise disposes of any of its assets (other than dispositions
expressly permitted by subsection 7.6), including, without limitation, as a
result of a condemnation, no later than three Business Days after receipt
of the Net Proceeds therefrom, the Borrower shall prepay the Term Loans in
an amount equal to the lesser of 100% of such Net Proceeds and the
outstanding amount of the Term Loans.
(c) So long as any portion of the Term Loans remains
outstanding, in the event that any Loan Party receives any proceeds from
any insurance policies as a result of a casualty, no later than five
Business Days after receipt of the Net Proceeds therefrom, the Loan Party
shall either (i) prepay the Term Loans in an amount equal to the lesser of
100% of such Net Proceeds and the outstanding amount of the Term Loans or
(ii) opt to apply such Net Proceeds towards the restoration of the damaged
property with any surplus used to prepay the Term Loans; provided that in
the event such Net Proceeds (1) equals or exceeds $500,000 but is less than
$1 million, the Loan Party shall provide the Administrative Agent, within
20 Business Days after receipt of such Net Proceeds, with a written
estimate (as to both time and expense) from the contractor that the Loan
Party has hired to perform the restoration, and shall subsequently provide
the Administrative Agent within two Business Days of receipt thereof by
such Loan Party, with a final invoice from such contractor which indicates
that the Loan Party has paid for such restoration in full; or (2) equals or
exceeds $1 million, the Loan Party shall deposit such Net Proceeds into a
cash collateral account to be maintained by and
29
in the sole dominion and control of the Administrative Agent, which funds
may be used by the Borrower and its Subsidiaries, for a period of 360 days
from the date such Net Proceeds are deposited into such account, solely to
restore such damaged property after which time such proceeds shall be used
in the manner provided in clause (i) above; and so long as no Default or
Event of Default has occurred or is continuing, all such cash collateral
shall be invested by the Administrative Agent as instructed by the Borrower
and agreed to by the Administrative Agent in its reasonable discretion and
the Borrower shall be entitled to receive all interest on such cash
collateral.
(d) On the earlier of (i) the receipt by the Lenders of the
financial statements required to be delivered by the Borrower pursuant to
subsection 6.1(a) and (ii) the 90th day of each fiscal year of the
Borrower, the Borrower shall repay the Term Loans in an amount equal to the
lesser of 75% of Excess Cash Flow for the preceding fiscal year of the
Borrower (commencing with the fiscal year in which the Closing Date occurs)
and the outstanding amount of the Term Loans.
(e) Each prepayment of the Term Loans pursuant to this
subsection 2.9 shall be accompanied by payment in full of all accrued fees
and interest thereon to and including the date of such prepayment, together
with any additional amounts owing pursuant to subsection 2.20. Each
prepayment of the Term Loans required pursuant to this subsection 2.9 may
not be reborrowed and shall be applied to the installments of principal
thereof pro rata; provided, that prepayment of the Term Loans required
pursuant to subsection 2.9(d) in connection with each fiscal year of the
Borrower shall be applied first, to the installments of principal with
scheduled maturities falling within the twelve months following the end of
the fiscal year in respect of which such Excess Cash Flow has been derived
in the direct order of maturity, and second, to any remaining amounts, pro
rata.
(f) To the extent that the Net Proceeds of any of the
transactions referred to in subsection 2.9(a) (with respect to Indebtedness
constituting High Yield Notes only) exceeds the sum of the outstanding
amount of the Term Loans required to be prepaid pursuant to such subsection
and the aggregate amount of Existing Subordinated Debt to be repaid with
the proceeds thereof, an amount equal to such excess shall be applied to
permanently reduce the Overadvance Limit.
To the extent that (i) the Net Proceeds of any of the
transactions referred to in subsections 2.9(a) (excluding Indebtedness
constituting High Yield Notes), (b) or (c) or (ii) with respect to
subsection 2.9(d), 75% of Excess Cash Flow for the preceding year, exceeds
the outstanding amount of the Term Loans required to be prepaid pursuant to
such subsections, an amount equal to such excess shall be applied first to
permanently reduce the Uncovered L/C Amount to zero and any remaining
excess to permanently reduce the Overadvance Limit.
2.10 Mandatory Prepayments and Other Reductions of Revolving
Credit Loans. (a) The Borrower will repay the Revolving Credit Loans in an
amount necessary to cause the Overadvance Amount to equal zero (1) during
each calendar year, so that the Overadvance Amount is not above zero for an
aggregate period of more than 45 days during such calendar year, (2) during
the period of December 1 through January 31 of each two consecutive
calendar years, so that the Overadvance Amount is not above zero for a
period of
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more than 20 consecutive days during such period and (3) during any time
period in each calendar year except for the period described in (2) above,
so that the Overadvance Amount is not above zero for a period of more than
10 consecutive days.
(b) If, at any time, the Aggregate Covered Outstanding
Revolving Extensions of Credit at such time exceed the sum of the Borrowing
Base and the Overadvance Limit at such time, the Borrower shall, without
notice or demand, immediately repay the Revolving Credit Loans in an
aggregate principal amount equal to the lesser of (i) the amount of such
excess and (ii) the aggregate principal amount of Revolving Credit Loans
then outstanding, together with interest accrued to the date of such
payment or prepayment on the principal so prepaid and any amounts payable
under subsection 2.20 in connection therewith. To the extent that after
giving effect to any prepayment of the Revolving Credit Loans required by
the preceding sentence, the Aggregate Covered Outstanding Revolving
Extensions of Credit at such time exceed the sum of the Borrowing Base and
the Overadvance Limit at such time, the Borrower shall, without notice or
demand, immediately deposit in a Cash Collateral Account upon terms
reasonably satisfactory to the Administrative Agent an amount equal to the
lesser of (i) the aggregate then outstanding L/C Obligations and (ii) the
amount of such remaining excess. The Administrative Agent shall apply any
cash deposited in the Cash Collateral Account (to the extent thereof) to
pay any Reimbursement Obligations which become due thereafter, PROVIDED
that the Administrative Agent shall release to the Borrower from time to
time such portion of the amount on deposit in the Cash Collateral Account
which is equal to the amount by which the Borrowing Base at such time plus
the amount on deposit in the Cash Collateral Account exceeds the Aggregate
Outstanding Revolving Extensions of Credit at such time. "Cash Collateral
Account" means an account established by the Borrower with the
Administrative Agent and over which the Administrative Agent shall have
exclusive dominion and control, including the right of withdrawal for
application in accordance with this subsection 2.10(b).
2.11 CONVERSION AND CONTINUATION OPTIONS. (a) The Borrower may
elect from time to time to convert Eurodollar Loans to ABR Loans by giving
the Administrative Agent at least two Business Days' prior irrevocable
notice of such election, PROVIDED that any such conversion of Eurodollar
Loans may only be made on the last day of an Interest Period with respect
thereto. The Borrower may elect from time to time to convert ABR Loans to
Eurodollar Loans by giving the Administrative Agent at least three Business
Days' prior irrevocable notice of such election. Any such notice of
conversion to Eurodollar Loans shall specify the length of the initial
Interest Period or Interest Periods therefor. Upon receipt of any such
notice the Administrative Agent shall promptly notify each Lender thereof.
All or any part of outstanding Eurodollar Loans and ABR Loans may be
converted as provided herein, PROVIDED that (i) no Loan may be converted
into a Eurodollar Loan when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Lenders have
determined that such a conversion is not appropriate and (ii) no Loan may
be converted into a Eurodollar Loan after the date that is one month prior
to the Termination Date (in the case of conversions of Revolving Credit
Loans) or the date of the final installment of principal of the Term Loans.
(b) Any Eurodollar Loans may be continued as such upon the
expiration of the then current Interest Period with respect thereto by the
Borrower giving notice to the Administrative Agent, in accordance with the
applicable provisions of the term "Interest
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Period" set forth in subsection 1.1, of the length of the next Interest
Period to be applicable to such Loans, PROVIDED that no Eurodollar Loan may
be continued as such (i) when any Event of Default has occurred and is
continuing and the Administrative Agent has or the Majority Lenders have
determined that such a continuation is not appropriate or (ii) after the
date that is one month prior to the Termination Date (in the case of
continuations of Revolving Credit Loans) or the date of the final
installment of principal of the Term Loans and PROVIDED, FURTHER, that if
the Borrower shall fail to give such notice or if such continuation is not
permitted such Loans shall be automatically converted to ABR Loans on the
last day of such then expiring Interest Period.
2.12 MAXIMUM NUMBER OF TRANCHES. In no event shall there be
more than ten (10) Eurodollar Tranches outstanding at any time.
2.13 INTEREST RATES AND PAYMENT DATES. (a) Each Eurodollar
Loan shall bear interest for each day during each Interest Period with
respect thereto at a rate per annum equal to the Eurodollar Rate determined
for such day plus 2.50%.
(b) Each ABR Loan shall bear interest at a rate per annum equal
to the ABR plus 1.50%.
(c) If all or a portion of (i) any principal of any Loan, (ii)
any interest payable thereon, (iii) any commitment fee or (iv) any other
amount payable hereunder shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), the principal of the Loans and any
such overdue interest, commitment fee or other amount shall bear interest
at a rate per annum which is (x) in the case of principal, the rate that
would otherwise be applicable thereto pursuant to the foregoing provisions
of this subsection plus 2% or (y) in the case of any such overdue interest,
commitment fee or other amount, the rate described in paragraph (b) of this
subsection plus 2%, in each case from the date of such non-payment until
such overdue principal, interest, commitment fee or other amount is paid in
full (as well after as before judgment).
(d) Interest shall be payable in arrears on each Interest
Payment Date, PROVIDED that interest accruing pursuant to paragraph (c) of
this subsection shall be payable from time to time on demand.
2.14 COMPUTATION OF INTEREST AND FEES. (a) Amounts payable
under this Agreement including interest, shall be calculated on the basis
of a 360-day year for the actual days elapsed, except that with respect to
(i) interest calculated on the basis of the Prime Rate and (ii) commitment
fees, such amounts shall be calculated on the basis of a 365- (or 366-, as
the case may be) day year for the actual days elapsed. The Administrative
Agent shall as soon as practicable, notify the Borrower and the affected
Lenders of each determination of a Eurodollar Rate. Any change in the
interest rate on a Loan resulting from a change in the ABR or the
Eurocurrency Reserve Requirement shall become effective as of the opening
of business on the day on which such change becomes effective. The
Administrative Agent shall, as soon as practicable, notify the Borrower and
the affected Lenders of the effective date and the amount of each such
change in interest rate.
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(b) Each determination of an interest rate by the Administrative
Agent pursuant to any provision of this Agreement shall be conclusive and
binding on the Borrower and the Lenders in the absence of manifest error.
The Administrative Agent shall, at the request of the Borrower, deliver to
the Borrower a statement showing the quotations used by the Administrative
Agent in determining any interest rate pursuant to subsection 2.13(a), (b)
or (c).
(c) For purposes of the Interest Act (Canada), whenever any
interest under the Loan Documents is calculated using a rate based on a
year of 360 days, such rate determined pursuant to such calculation, when
expressed as an annual rate, is equivalent to (i) the applicable rate based
on a year of 360 days, (ii) multiplied by the actual number of days in the
calendar year in which the period for which such interest is payable (or
compounded) ends, and (iii) divided by 360.
2.15 INABILITY TO DETERMINE INTEREST RATE. If prior to the
first day of any Interest Period:
(a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that,
by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining the Eurodollar Rate for
such interest Period, or
(b) the Administrative Agent shall have received notice from the
Majority Lenders that the Eurodollar Rate determined or to be determined
for such Interest Period will not adequately and fairly reflect the cost to
such Lenders (as conclusively certified by such Lenders) of making or
maintaining their affected Loans during such Interest Period;
the Administrative Agent shall give telecopy or telephonic notice thereof
to the Borrower and the Lenders as soon as practicable thereafter. If such
notice is given (x) any Eurodollar Loans requested to be made on the first
day of such Interest Period shall be made as ABR Loans, (y) any Loans that
were to have been converted on the first day of such Interest Period to
Eurodollar Loans shall be converted to or continued as ABR Loans and (z)
any outstanding Eurodollar Loans shall be converted, on the first day of
such Interest Period, to ABR Loans. Until such notice has been withdrawn by
the Administrative Agent, no further Eurodollar Loans shall be made or
continued as such, nor shall the Borrower have the right to convert ABR
Loans to Eurodollar Loans.
2.16 PRO RATA TREATMENT AND PAYMENTS. (a) All payments
(including prepayments) to be made by the Borrower hereunder, whether on
account of principal, interest, fees or otherwise, shall be made without
set off or counterclaim and shall be made prior to 12:00 Noon, New York
City time, on the due date thereof to the Administrative Agent, for the
account of the appropriate Lenders, at the Administrative Agent's office
specified in subsection 10.2 (except as otherwise provided herein) in
Dollars and in immediately available funds. The Administrative Agent shall
distribute such payments to the Lenders entitled to receive the same
promptly upon receipt in like funds as received. If any payment hereunder
(other than payments on Eurodollar Loans) becomes due and payable on a day
other than a Business Day, such payment shall be extended to the next
succeeding
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Business Day, and, with respect to payments of principal, interest thereon
shall be payable at the then applicable rate during such extension. If any
payment on a Eurodollar Loan becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day (and, with respect to payments of principal, interest thereon
shall be payable at the then applicable rate during such extension) unless
the result of such extension would be to extend such payment into another
calendar month, in which event such payment shall be made on the
immediately preceding Business Day.
(b) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make
the amount that would constitute its portion of such borrowing available to
the Administrative Agent, the Administrative Agent may assume that such
Lender is making such amount available to the Administrative Agent, and the
Administrative Agent may, in reliance upon such assumption, make available
to the Borrower a corresponding amount. If such amount is not made
available to the Administrative Agent by the required time on the Borrowing
Date therefor, such Lender shall pay to the Administrative Agent, on
demand, such amount with interest thereon at a rate equal to the daily
average Federal Funds Effective Rate for the period until such Lender makes
such amount immediately available to the Administrative Agent. A
certificate of the Administrative Agent submitted to any Lender with
respect to any amounts owing under this subsection shall be conclusive in
the absence of manifest error. If such Lender's portion of such borrowing
is not made available to the Administrative Agent by such Lender within
three Business Days of such Borrowing Date, the Administrative Agent shall
also be entitled to recover such amount with interest thereon at the rate
per annum applicable to ABR Loans hereunder, on demand, from the Borrower.
(c) Each borrowing by the Borrower of Term Loans and Revolving
Credit Loans shall be made ratably from the Lenders in accordance with
their respective Term Loan Commitment Percentages and Revolving Credit
Commitment Percentages. Any reduction of the Revolving Credit Commitments
shall be made ratably among the Lenders in accordance with their respective
Revolving Credit Commitment Percentages. Each payment (including each
prepayment) by the Borrower on account of principal of and interest on the
Term Loans shall be made pro rata according to the respective outstanding
principal amounts of the Term Loans then held by the Lenders. Each payment
(including each prepayment) by the Borrower on account of principal of and
interest on the Revolving Credit Loans shall be made pro rata according to
the respective outstanding principal amounts of the Revolving Credit Loans
then held by the Lenders.
2.17 ILLEGALITY. Notwithstanding any other provision herein, if
the adoption of or any change in any Requirement of Law or in the
interpretation or application thereof shall make it unlawful for any Lender
to make or maintain Eurodollar Loans as contemplated by this Agreement, (a)
the commitment of such Lender hereunder to make Eurodollar Loans, continue
Eurodollar Loans as such and convert ABR Loans to Eurodollar Loans shall
forthwith be cancelled and (b) such Lender's Loans then outstanding as
Eurodollar Loans, if any, shall be converted automatically to ABR Loans on
the respective last days of the then current Interest Periods with respect
to such Loans or within such earlier period as required by law. If any
such conversion of a Eurodollar Loan occurs on a day which is not the last
day of the then current Interest Period with respect thereto, the Borrower
shall pay to such Lender such amounts, if any, as may be required pursuant
to subsection 2.20.
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2.18 REQUIREMENTS OF LAW. (a) If the adoption of or any change
in any Requirement of Law or in the interpretation or application thereof
or compliance by any Lender with any request or directive (whether or not
having the force of law) from any central bank or other Governmental
Authority made subsequent to the date hereof:
(i) shall subject any Lender to any tax of any kind whatsoever with
respect to this Agreement, any Note or any Eurodollar Loan made by it, or
change the basis of taxation of payments to such Lender in respect thereof
(except for Non-Excluded Taxes covered by subsection 2.19 and changes in
the rate of tax on the overall net income of such Lender);
(ii) shall impose, modify or hold applicable any reserve, special
deposit, compulsory loan or similar requirement against assets held by,
deposits or other liabilities in or for the account of, advances, loans or
other extensions of credit by, or any other acquisition of funds by, any
office of such Lender which is not otherwise included in the determination
of the Eurodollar Rate hereunder; or
(iii) shall impose on such Lender any other condition; and the result
of any of the foregoing is to increase the cost to such Lender, by an
amount which such Lender deems to be material, of making, converting into,
continuing or maintaining Eurodollar Loans or to reduce any amount
receivable hereunder in respect thereof, then, in any such case, the
Borrower shall promptly pay such Lender such additional amount or amounts
as will compensate such Lender for such increased cost or reduced amount
receivable.
(b) If any Lender shall have determined that the adoption of or
any change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any
Governmental Authority made subsequent to the date hereof shall have the
effect of reducing the rate of return on such Lender's or such
corporation's capital as a consequence of its obligations hereunder or
under any Letter of Credit to a level below that which such Lender or such
corporation could have achieved but for such adoption, change or compliance
(taking into consideration such Lender's or such corporation's policies
with respect to capital adequacy) by an amount deemed by such Lender to be
material, then from time to time, the Borrower shall promptly pay to such
Lender such additional amount or amounts as will compensate such Lender for
such reduction.
(c) If any Lender becomes entitled to claim any additional
amounts pursuant to this subsection, it shall promptly notify the Borrower
(with a copy to the Administrative Agent) of the event by reason of which
it has become so entitled. A certificate as to any additional amounts
payable pursuant to this subsection submitted by such Lender to the
Borrower (with a copy to the Administrative Agent) shall be conclusive in
the absence of manifest error. The agreements in this subsection shall
survive the termination of this Agreement and the payment of the Loans and
all other amounts payable hereunder.
2.19 TAXES. (a) All payments made by the Borrower under this
Agreement and any Notes shall be made free and clear of, and without
deduction or withholding for or
35
on account of, any present or future income, stamp or other taxes, levies,
imposts, duties, charges, fees, deductions or withholdings, now or hereafter
imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on the Administrative Agent or any Lender as a
result of a present or former connection between the Administrative Agent or
such Lender and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or taxing authority thereof or therein
(other than any such connection arising solely from the Administrative Agent
or such Lender having executed, delivered or performed its obligations or
received a payment under, or enforced, this Agreement or any Note). If any
such non-excluded taxes, levies, imposts, duties, charges, fees deductions or
withholdings ("NON-EXCLUDED TAXES") are required to be withheld from any
amounts payable to the Administrative Agent or any Lender hereunder or under
any Note, the amounts so payable to the Administrative Agent or such Lender
shall be increased to the extent necessary to yield to the Administrative
Agent or such Lender (after payment of all Non-Excluded Taxes) interest or
any such other amounts payable hereunder at the rates or in the amounts
specified in this Agreement, PROVIDED, HOWEVER, that the Borrower shall not
be required to increase any such amounts payable to any Lender that is not
incorporated or organized under the laws of the United States of America or a
state thereof if such Lender fails to comply with the requirements of
paragraph (b) of this subsection. Whenever any Non-Excluded Taxes are
payable by the Borrower, as promptly as possible thereafter the Borrower
shall send to the Administrative Agent for its own account or for the account
of such Lender, as the case may be, a certified copy of an original official
receipt received by the Borrower showing payment thereof. If the Borrower
fails to pay any Non-Excluded Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts
or other required documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender
as a result of any such failure. The agreements in this subsection shall
survive the termination of this Agreement and the payment of the Loans and
all other amounts payable hereunder.
(b) Each Lender that is not incorporated or organized under the laws
of the United States of America or a state thereof shall:
(i) deliver to the Borrower and the Administrative Agent, prior to
the Closing Date in the case of the initial Lenders, (A) two duly completed
copies of United States Internal Revenue Service Form 1001 or 4224, or
successor applicable form, as the case may be, and (B) an Internal Revenue
Service Form W-8 or W-9, or successor applicable form, as the case may be;
(ii) deliver to the Borrower and the Administrative Agent two
further copies of any such form or certification on or before the date that
any such form or certification expires or becomes obsolete and after the
occurrence of any event requiring a change in the most recent form
previously delivered by it to the Borrower; and
(iii) obtain such extensions of time for filing and complete such
forms or certifications as may reasonably be requested by the Borrower or
the Administrative Agent;
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unless in any such case an event (including, without limitation, any change
in treaty, law or regulation) has occurred after the date of this Agreement
and prior to the date on which any such delivery would otherwise be
required which renders all such forms inapplicable or which would prevent
such Lender from duly completing and delivering any such form with respect
to it and such Lender so advises the Borrower and the Administrative Agent.
Such Lender shall certify (i) in the case of a Form 1001 or 4224, that it
is entitled to receive payments under this Agreement or the Notes without
deduction or withholding of any United States federal income taxes and (ii)
in the case of a Form W-8 or W-9, that it is entitled to an exemption from
United States backup withholding tax. Each Person that shall become a
Lender or a Participant pursuant to subsection 10.6 shall, upon the
effectiveness of the related transfer, be required to provide all of the
forms and statements required pursuant to this subsection, provided that in
the case of a Participant such Participant shall furnish all such required
forms and statements to the Lender from which the related participation
shall have been purchased.
(c) Neither the Administrative Agent nor any Lender shall be
entitled to claim any indemnity payment or additional amount payable
pursuant to this subsection 2.19 with respect to any tax unless the
Administrative Agent or such Lender, as the case may be, shall have
notified the Borrower that it will demand compensation for such payment or
amount not more than 120 days after the date on which the Administrative
Agent or such Lender, as the case may be, becomes aware of the costs or
reductions giving rise to such claim. Failure on the part of the
Administrative Agent or such Lender, as the case may be, to demand any
indemnity payment of any such additional amount with respect to any period
shall not constitute a waiver of the Administrative Agent's or such
Lender's, right, as the case may be, to demand compensation with respect to
any other period.
2.20 INDEMNITY. The Borrower agrees to indemnify each Lender
and to hold each Lender harmless from any loss or expense which such Lender
may sustain or incur as a consequence of (a) default by the Borrower in
making a borrowing of, conversion into or continuation of Eurodollar Loans
after the Borrower has given a notice requesting the same in accordance
with the provisions of this Agreement, (b) default by the Borrower in
making any prepayment after the Borrower has given a notice thereof in
accordance with the provisions of this Agreement or (c) the making of a
prepayment of Eurodollar Loans on a day which is not the last day of an
Interest Period with respect thereto. Such indemnification may include an
amount equal to the excess, if any, of (i) the amount of interest which
would have accrued on the amount so prepaid, or not so borrowed, converted
or continued, for the period from the date of such prepayment or of such
failure to borrow, convert or continue to the last day of such Interest
Period (or, in the case of a failure to borrow, convert or continue, the
Interest Period that would have commenced on the date of such failure) in
each case at the applicable rate of interest for such Loans provided for
herein (excluding, however, the additional 2.50% for Eurodollar Loans and
1.50% for ABR Loans referred to in subsection 2.13, included therein, if
any) over (ii) the amount of interest (as reasonably determined by such
Lender) which would have accrued to such Lender on such amount by placing
such amount on deposit for a comparable period with leading banks in the
interbank eurodollar market. This covenant shall survive the termination
of this Agreement and the payment of the Loans and all other amounts
payable hereunder.
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2.21 CHANGE OF LENDING OFFICE. Each Lender agrees that if it
makes any demand for payment under subsection 2.18 or 2.19(a), or if any
adoption or change of the type described in subsection 2.17 shall occur
with respect to it, it will use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions and so long as such
efforts would not be disadvantageous to it, as determined in its sole
discretion) to designate a different lending office if the making of such a
designation would reduce or obviate the need for the Borrower to make
payments under subsection 2.18 or 2.19(a), or would eliminate or reduce the
effect of any adoption or change described in subsection 2.17.
SECTION 3. LETTERS OF CREDIT
3.1 L/C COMMITMENT.
(a) Subject to the terms and conditions hereof, the Issuing
Bank, in reliance on the agreements of the other Lenders set forth in
subsection 3.4(a) agrees to issue letters of credit ("Letters of Credit")
for the account of the Borrower on any Business Day during the Commitment
Period in such form as may be approved from time to time by the Issuing
Bank; PROVIDED that the Issuing Bank shall have no obligation to issue any
Letter of Credit if, after giving effect to such issuance, (1) the L/C
Obligations would exceed the L/C Commitment, (2) the Available Revolving
Credit Commitments would be less than zero or (3) the Aggregate Covered
Outstanding Revolving Extensions of Credit at such time would exceed the
Borrowing Base at such time.
(b) Each Letter of Credit shall:
(1) be denominated in Dollars and shall be either (A) a standby
letter of credit issued to support obligations of the Borrower (a "STANDBY
LETTER OF CREDIT"), or (B) a commercial letter of credit issued in respect
of the purchase of goods or services by the Borrower and its Subsidiaries
in the ordinary course of business (a "COMMERCIAL LETTER OF CREDIT") and
(2) expire no later than the earlier of (i) one year after the
date of issuance and (ii) five Business Days prior to the Termination Date;
provided that any Letter of Credit with a one-year tenor may provide for
the renewal thereof for additional one-year periods (which shall in no
event extend beyond the date referred to in clause (ii) above).
(c) Each Letter of Credit shall be subject to the Uniform Customs
and, to the extent not inconsistent therewith, the laws of the State of New
York.
(d) The Issuing Bank shall not at any time be obligated to issue any
Letter of Credit hereunder if such issuance would conflict with, or cause
the Issuing Bank or any L/C Participant to exceed any limits imposed by,
any applicable Requirement of Law.
3.2 PROCEDURE FOR ISSUANCE OF LETTERS OF CREDIT.
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The Borrower may from time to time request that the Issuing Bank
issue a Letter of Credit by delivering to the Issuing Bank at its address
for notices specified herein an Application therefor, completed to the
satisfaction of the Issuing Bank, and such other certificates, documents
and other papers and information as the Issuing Bank may request. Upon
receipt of any Application, the Issuing Bank will process such Application
and the certificates, documents and other papers and information delivered
to it in connection therewith in accordance with its customary procedures
and shall promptly issue the Letter of Credit requested thereby (but in no
event shall the Issuing Bank be required to issue any Letter of Credit
earlier than three Business Days after its receipt of the Application
therefor and all such other certificates, documents and other papers and
information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed by the
Issuing Bank and the Borrower. The Issuing Bank shall furnish a copy of
such Letter of Credit to the Borrower promptly following the issuance
thereof.
3.3 FEES, COMMISSIONS AND OTHER CHARGES.
(a) The Borrower shall pay to the Administrative Agent, for the
account of the Issuing Bank, a fronting fee with respect to each Letter of
Credit in an amount equal to 1/4 of 1% per annum of the face amount of such
Letter of Credit. Such fronting fee shall be payable in arrears on each
L/C Fee Payment Date and shall be nonrefundable.
(b) The Borrower shall pay to the Administrative Agent, for the
account of the Issuing Bank and the L/C Participants, a letter of credit
commission with respect to each Letter of Credit, computed for the period
from the date of issuance thereof at a per annum rate equal to 2.50% (less
any fronting fee paid pursuant to subsection 3.3(a)), calculated on the
basis of a 360 day year, of the aggregate average daily amount available to
be drawn under such Letter of Credit during the period for which payment is
being made. Such fee shall be payable to the Issuing Bank and the L/C
Participants to be shared ratably among them in accordance with their
respective Revolving Credit Commitment Percentages. Such commissions shall
be payable in arrears on each L/C Fee Payment Date.
(c) In addition to the foregoing fees and commissions, the
Borrower shall pay or reimburse the Issuing Bank for such normal and
customary fees as are incurred or charged by the Issuing Bank in issuing,
effecting payment under, amending or otherwise administering any Letter of
Credit.
(d) The Administrative Agent shall, promptly following its
receipt thereof, distribute to the Issuing Bank and the L/C Participants
all fees and commissions received by the Administrative Agent for their
respective accounts pursuant to this subsection.
3.4 L/C PARTICIPATIONS.
(a) The Issuing Bank irrevocably agrees to grant and hereby
grants to each L/C Participant, and, to induce the Issuing Bank to issue
Letters of Credit hereunder, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the Issuing Bank,
on the terms and conditions hereinafter stated, for such L/C Participant's
own account and risk an undivided interest equal to such L/C Participant's
Revolving Credit Commitment Percentage in the Issuing Bank's obligations
and rights under
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each Letter of Credit issued hereunder and the amount of each draft paid by
the Issuing Bank thereunder. Each L/C Participant unconditionally and
irrevocably agrees with the Issuing Bank that, if a draft is paid under any
Letter of Credit for which the Issuing Bank is not reimbursed in full by
the Borrower in accordance with the terms of this Agreement, such L/C
Participant shall pay to the Issuing Bank upon demand at the Issuing Bank's
address for notices specified herein an amount equal to such L/C
Participant's Revolving Credit Commitment Percentage of the amount of such
draft, or any part thereof, which is not so reimbursed.
(b) If any amount required to be paid by any L/C Participant to
the Issuing Bank pursuant to subsection 3.4(a) in respect of any
unreimbursed portion of any payment made by the Issuing Bank under any
Letter of Credit is paid to the Issuing Bank within three Business Days
after the date such payment is due, such L/C Participant shall pay to the
Issuing Bank on demand an amount equal to the product of (i) such amount,
times (ii) the daily average Federal funds rate, as quoted by the Issuing
Bank, during the period from and including the date such payment is
required to the date on which such payment is immediately available to the
Issuing Bank, times (iii) a fraction the numerator of which is the number
of days that elapse during such period and the denominator of which is 360.
If any such amount required to be paid by any L/C Participant pursuant to
subsection 3.4(a) is not in fact made available to the Issuing Bank by such
L/C Participant within three Business Days after the date such payment is
due, the Issuing Bank shall be entitled to recover from such L/C
Participant, on demand, such amount with interest thereon calculated from
such due date at the rate per annum applicable to ABR Loans hereunder. A
certificate of the Issuing Bank submitted to any L/C Participant with
respect to any amounts owing under this subsection shall be conclusive in
the absence of manifest error.
(c) Whenever, at any time after the Issuing Bank has made
payment under any Letter of Credit and has received from any L/C
Participant its pro rata share of such payment in accordance with
subsection 3.4(a), the Issuing Bank receives any payment related to such
Letter of Credit (whether directly from the Borrower or otherwise,
including proceeds of collateral applied thereto by the Issuing Bank), or
any payment of interest on account thereof, the Issuing Bank will
distribute to such L/C Participant its pro rata share thereof; PROVIDED,
HOWEVER, that in the event that any such payment received by the Issuing
Bank pursuant to subsection 3.5 shall be required to be returned by the
Issuing Bank, such L/C Participant shall return to the Issuing Bank the
portion thereof previously distributed by the Issuing Bank to it.
3.5 REIMBURSEMENT OBLIGATION OF THE BORROWER.
(a) The Borrower agrees to reimburse the Issuing Bank on each
date on which the Issuing Bank notifies the Borrower of the date and amount
of a draft presented under any Letter of Credit and paid by the Issuing
Bank for the amount of (i) such draft so paid and (ii) any taxes, fees,
charges or other costs or expenses incurred by the Issuing Bank in
connection with such payment. Each such payment shall be made to the
Issuing Bank at its address for notices specified herein in lawful money of
the United States of America and in immediately available funds.
(b) Interest shall be payable on any and all amounts remaining
unpaid by the Borrower under this subsection from the date such amounts
become payable (whether at
40
stated maturity, by acceleration or otherwise) until payment in full at the
rate which would be payable on any outstanding ABR Loans which were then
overdue.
3.6 OBLIGATIONS ABSOLUTE.
(a) The Borrower's obligations under this Section 3 shall be
absolute and unconditional under any and all circumstances and irrespective
of any set-off, counterclaim or defense to payment which the Borrower may
have or have had against the Issuing Bank or any beneficiary of a Letter of
Credit.
(b) The Borrower also agrees with the Issuing Bank that the
Issuing Bank shall not be responsible for, and the Borrower's Reimbursement
Obligations under subsection 3.5(a) shall not be affected by, among other
things, (i) the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, provided that the Issuing Bank shall have exercised
the standard of care specified in the Uniform Customs, or (ii) any dispute
between or among the Borrower and any beneficiary of any Letter of Credit
or any other party to which such Letter of Credit may be transferred or
(iii) any claims whatsoever of the Borrower against any beneficiary of such
Letter of Credit or any such transferee.
(c) The Issuing Bank shall not be liable for any error,
omission, interruption or delay in transmission, dispatch or delivery of
any message or advice, however transmitted, in connection with any Letter
of Credit, except for errors or omissions caused by the Issuing Bank's
gross negligence or willful misconduct.
(d) The Borrower agrees that any action taken or omitted by the
Issuing Bank under or in connection with any Letter of Credit or the
related drafts or documents, if done in the absence of gross negligence of
willful misconduct and in accordance with the standards of care specified
in the Uniform Commercial Code of the State of New York, shall be binding
on the Borrower and shall not result in any liability of the Issuing Bank
to the Borrower.
3.7 LETTER OF CREDIT PAYMENTS.
If any draft shall be presented for payment under any Letter of
Credit, the Issuing Bank shall promptly notify the Borrower of the date and
amount thereof. The responsibility of the Issuing Bank to the Borrower in
connection with any draft presented for payment under any Letter of Credit
shall, in addition to any payment obligation expressly provided for in such
Letter of Credit, be limited to determining that the documents (including
each draft) delivered under such Letter of Credit in connection with such
presentment are in conformity with such Letter of Credit.
3.8 APPLICATION.
To the extent that any provision of any Application related to any
Letter of Credit is inconsistent with the provisions of this Section 3, the
provisions of this Section 3 shall apply.
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SECTION 4. REPRESENTATIONS AND WARRANTIES
To induce the Administrative Agent and the Lenders to enter into
this Agreement and to make the Loans and issue or participate in the
Letters of Credit, the Borrower hereby represents and warrants to the
Administrative Agent and each Lender that:
4.1 FINANCIAL CONDITION. (a) The consolidated balance sheet of
the Borrower and its consolidated Subsidiaries as at December 31, 1995 and
the related consolidated statements of income and of cash flows for the
fiscal year ended on such date, reported on by KPMG Peat Marwick LLP copies
of which have heretofore been furnished to the Administrative Agent with
copies for each Lender, present fairly in all material respects the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of their
operations and their consolidated cash flows for the fiscal year then
ended. The unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at June 30, 1996 and the related unaudited
consolidated statements of income and of cash flows for the three and
six-month period ended on such date, certified by a Responsible Officer,
copies of which have heretofore been furnished to the Administrative Agent
with copies for each Lender, present fairly in all material respects the
consolidated financial condition of the Borrower and its consolidated
Subsidiaries as at such date, and the consolidated results of their
operations and their consolidated cash flows for the three and six-month
period then ended (subject to normal year-end audit adjustments), except
that they have been prepared on a first-in-first-out inventory valuation
method and except for the absence of notes and related schedules. All such
financial statements, including the related schedules and notes thereto,
have been prepared in accordance with GAAP applied consistently throughout
the periods involved (except as approved by such accountants or Responsible
Officer, as the case may be, and as disclosed therein). Neither the
Borrower nor any of its consolidated Subsidiaries had, at the date of the
most recent balance sheet referred to above, any material Guarantee
Obligation, contingent liability or liability for taxes, or any long-term
lease or unusual forward or long-term commitment, including, without
limitation, any interest rate or foreign currency swap or exchange
transaction, which is not reflected in the foregoing statements or in the
notes thereto. During the period from December 31, 1995 to and including
the date hereof there has been no sale, transfer or other disposition by
the Borrower or any of its consolidated Subsidiaries of any material part
of its business or property and no purchase or other acquisition of any
business or property (including any capital stock of any other Person)
material in relation to the consolidated financial condition of the
Borrower and its consolidated Subsidiaries at December 31, 1995.
(b) The unaudited pro forma consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at June 30, 1996 (including
the notes thereto) prepared on a first-in first-out inventory valuation
method (the "PRO FORMA BALANCE SHEET"), copies of which have heretofore
been furnished to the Administrative Agent with copies for each Lender, has
been prepared giving effect (as if such events had occurred on such date)
to (i) the Recapitalization contemplated to occur on the Closing Date and
(ii) the borrowings under this Agreement contemplated to be made on the
Closing Date. The Pro Forma Balance Sheet is based on the best information
available to the Borrower as of the date of delivery thereof, and presents
fairly in all material respects on a pro forma basis the estimated
financial position of the Borrower and its consolidated Subsidiaries as at
June 30, 1996, assuming that the events specified in the preceding sentence
had actually occurred at June 30, 1996.
42
4.2 NO CHANGE. (a) Except as set forth on Schedule 4.2, since
December 31, 1995, there has been no development or event which has had or
could reasonably be expected to have a Material Adverse Effect, and (b)
during the period from December 31, 1995, to and including the date hereof
no dividends or other distributions have been declared, paid or made upon
the Capital Stock of the Borrower nor has any of the Capital Stock of the
Borrower been redeemed, retired, purchased or otherwise acquired for value
by the Borrower or any of its Subsidiaries, in each case, other than as
contemplated pursuant to the Recapitalization Documents.
4.3 CORPORATE EXISTENCE; COMPLIANCE WITH LAW. Each of the
Borrower and its Subsidiaries (a) is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its organization,
(b) has the corporate power and authority, and the legal right, to own and
operate its property, to lease the property it operates as lessee and to
conduct the business in which it is currently engaged, (c) is duly
qualified as a foreign corporation and in good standing under the laws of
each jurisdiction where its ownership, lease or operation of property or
the conduct of its business requires such qualification except where the
failure to obtain such qualification would not have a Material Adverse
Effect and (d) is in compliance with all Requirements of Law except to the
extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.
4.4 CORPORATE POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS.
The Borrower has the corporate power and authority, and the legal right, to
make, deliver and perform the Loan Documents to which it is a party and to
borrow hereunder and has taken all necessary corporate action to authorize
the borrowings on the terms and conditions of the Loan Documents to which
it is a party and to authorize the execution, delivery and performance of
the Loan Documents to which it is a party. Except as set forth on Schedule
4.4, no consent or authorization of, filing with, notice to or other act by
or in respect of, any Governmental Authority or any other Person is
required in connection with the borrowings hereunder or with the execution,
delivery, performance, validity or enforceability of the Loan Documents to
which the Borrower is a party other than actions and filings relating to
the release of existing Liens and the perfection of the Liens created by
the Security Documents. This Agreement has been, and each other Loan
Document to which it is a party will be, duly executed and delivered on
behalf of the Borrower. This Agreement constitutes, and each other Loan
Document to which it is a party when executed and delivered will
constitute, a legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with its terms, subject to
the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing.
4.5 NO LEGAL BAR. The execution, delivery and performance of
the Loan Documents to which the Borrower is a party, the borrowings
hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or Contractual Obligation of the Borrower or of any of
its Subsidiaries and will not result in, or require, the creation or
imposition of any Lien on any of its or their respective properties or
revenues pursuant to any such Requirement of Law or Contractual Obligation.
43
4.6 NO MATERIAL LITIGATION. Except as set forth on Schedule
4.6, no litigation, investigation or proceeding of or before any arbitrator
or Governmental Authority is pending or, to the knowledge of the Borrower,
threatened by or against the Borrower or any of its Subsidiaries or against
any of its or their respective properties or revenues (a) with respect to
any of the Loan Documents or any of the transactions contemplated hereby or
thereby, or (b) which could reasonably be expected to have a Material
Adverse Effect.
4.7 NO DEFAULT. Neither the Borrower nor any of its
Subsidiaries is in default under or with respect to any of its Contractual
Obligations in any respect which could reasonably be expected to have a
Material Adverse Effect. No Default or Event of Default has occurred and is
continuing.
4.8 OWNERSHIP OF PROPERTY; LIENS. Except as set forth on
Schedule 4.8, each of the Borrower and its Subsidiaries has a valid
leasehold interest in, all its real property, or a valid leasehold interest
in, all its other property, and none of such owned property and no such
leasehold interest is subject to any Lien except as permitted by subsection
7.3.
4.9 INTELLECTUAL PROPERTY. Except as set forth on Schedule 4.9,
the Borrower and each of its Subsidiaries owns, is licensed to use, or
otherwise has the right to use all trademarks, tradenames, copyrights,
technology, know-how and processes necessary for the conduct of its
business as currently conducted except for those the failure to own or
license which could not reasonably be expected to have a Material Adverse
Effect (the "INTELLECTUAL PROPERTY"). No claim has been asserted and is
pending by any Person challenging or questioning the use of any such
Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does the Borrower know of any valid basis for
any such claim, which could reasonably be expected to have a Material
Adverse Effect. To the knowledge of the Borrower and its Subsidiaries the
use of such Intellectual Property by the Borrower and its Subsidiaries does
not infringe on the rights of any Person, except for such claims and
infringements that, in the aggregate, do not have and could not reasonably
be expected to have a Material Adverse Effect. To the knowledge of the
Borrower, all registrations and filings which, in the reasonable judgment
of the Borrower, are necessary to preserve the rights of the Borrower and
each of the Subsidiaries in their material Intellectual Property have been
made and are in good standing.
4.10 NO BURDENSOME RESTRICTIONS. No Requirement of Law or
Contractual Obligation of the Borrower or any of its Subsidiaries has or
could reasonably be expected to have a Material Adverse Effect.
4.11 TAXES. Except as set forth on Schedule 4.11, each of the
Borrower and its Subsidiaries has filed or caused to be filed all tax
returns which, to the knowledge of the Borrower, are required to be filed
and has paid all taxes shown to be due and payable on said returns or on
any assessments made against it or any of its property and all other taxes,
fees or other charges imposed on it or any of its property by any
Governmental Authority that are now due and payable (other than any the
amount or validity of which are currently being contested in good faith by
appropriate proceedings and with respect to which reserves in conformity
with GAAP have been provided on the books of the Borrower or its
Subsidiaries, as the case may be); no tax Lien has been filed, and, to the
knowledge of the Borrower, no claim is being asserted, with respect to any
such tax, fee or other charge.
44
4.12 FEDERAL REGULATIONS. No part of the proceeds of any Loans
will be used for "purchasing" or "carrying" any "margin stock" within the
respective meanings of each of the quoted terms under Regulation G or
Regulation U of the Board of Governors of the Federal Reserve System as now
and from time to time hereafter in effect. If requested by the
Administrative Agent, the Borrower will furnish to the Administrative Agent
with copies for each Lender a statement to the foregoing effect in
conformity with the requirements of FR Form G-1 or FR Form U-1 referred to
in said Regulation G or Regulation U, as the case may be.
4.13 ERISA. Neither a Reportable Event which could result in a
material liability to the Borrower or any of its Subsidiaries nor an
"accumulated funding deficiency" (within the meaning of Section 412 of the
Code or Section 302 of ERISA) has occurred during the five-year period
prior to the date on which this representation is made or deemed made with
respect to any Plan, and each Plan has complied in all material respects
with the applicable provisions of ERISA and the Code. No termination of a
Single Employer Plan has occurred that is reasonably likely to cause the
Borrower to incur liability, and no Lien in favor of the PBGC or a Plan has
arisen, during such five-year period. Except as set forth on Schedule 4.13,
the present value of all accrued benefits under each Single Employer Plan
(based on those assumptions used to fund such Plans) did not, as of the
last annual valuation date prior to the date on which this representation
is made or deemed made, exceed the value of the assets of such Plan
allocable to such accrued benefits. Except as set forth on Schedule 4.13,
neither the Borrower nor any Commonly Controlled Entity has had a complete
or partial withdrawal from any Multiemployer Plan in the past five years,
and neither the Borrower nor any Commonly Controlled Entity would become
subject to any material liability under ERISA if the Borrower or any such
Commonly Controlled Entity were to withdraw completely from all
Multiemployer Plans as of the valuation date most closely preceding the
date on which this representation is made or deemed made. No such
Multiemployer Plan is in Reorganization or Insolvent.
4.14 INVESTMENT COMPANY ACT; OTHER REGULATIONS. The Borrower is
not an "investment company", or a company "controlled" by an "investment
company", within the meaning of the Investment Company Act of 1940, as
amended. The Borrower is not subject to regulation under any Federal or
State statute or regulation (other than Regulation X of the Board of
Governors of the Federal Reserve System) which limits its ability to incur
Indebtedness.
4.15 SUBSIDIARIES. Schedule 4.15 sets forth a list of all
Subsidiaries of the Borrower at the date hereof. Each subsidiary of the
Borrower that is not a Subsidiary, is a corporation that conducts no
business, owns no assets (other than certain intercompany receivables), has
no liabilities having an aggregate value in excess of $75,000 other than
certain intercompany payables, and other than corporate franchise taxes.
4.16 PURPOSE OF LOANS. (a) The proceeds of the Term Loans shall
be used by the Borrower to finance a portion of the Recapitalization and to
pay related fees and expenses.
(b) The proceeds of the Revolving Credit Loans shall be used by
the Borrower to pay fees and expenses related to the Recapitalization, for
working capital purposes of the
44
Borrower and its Subsidiaries in the ordinary course of business and for
general corporate purposes.
4.17 ENVIRONMENTAL MATTERS. Except as set forth on Schedule 4.17:
(a) The facilities and properties owned, leased or operated by the
Borrower or any of its Subsidiaries (the "PROPERTIES") do not contain, and
have not previously contained, any Materials of Environmental Concern in
amounts or concentrations which (i) constitute or constituted a violation
of, or (ii) could reasonably be expected to give rise to liability under,
any Environmental Law, which, in either case, could reasonably be expected
to have a Material Adverse Effect.
(b) The Properties and all operations at the Properties are in
compliance, and to the knowledge of the Borrower have in the last five (5)
years been in compliance, in all material respects with all applicable
Environmental Laws, and to the knowledge of the Borrower there is no
contamination at, under or about the Properties or violation of any
Environmental Law with respect to the Properties or the business operated
by the Borrower or any of its Subsidiaries (the "BUSINESS") which could
materially interfere with the continued operation of the Properties or
materially impair the fair saleable value thereof.
(c) Neither the Borrower nor any of its Subsidiaries has received any
notice of violation, alleged violation, non-compliance, liability or
potential liability regarding environmental matters or compliance with
Environmental Laws with regard to any of the Properties or the Business,
nor does the Borrower have knowledge or reason to believe that any such
notice is being threatened, except, in either case, for such notice as
could not reasonably be expected to have a Material Adverse Effect.
(d) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a
location which could reasonably be expected to give rise to liability
under, any Environmental Law, except for such transportation or disposal as
could not reasonably be expected to have a Material Adverse Effect, nor
have any Materials of Environmental Concern been generated, treated, stored
or disposed of at, on or under any of the Properties in violation of, or in
a manner that could reasonably be expected to give rise to liability under,
any applicable Environmental Law, except for such transportation or
disposal as could not reasonably be expected to have a Material Adverse
Effect.
(e) No judicial proceeding or governmental or administrative action
is pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be
named as a party with respect to the Properties or the Business, nor are
there any consent decrees or other decrees, consent orders, administrative
orders or other orders, or other administrative or judicial requirements
outstanding under any Environmental Law with respect to the Properties or
the Business.
(f) There has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related
to the
46
operations of the Borrower or any Subsidiary in connection with the
Properties or otherwise in connection with the Business, in violation of or
in amounts or in a manner that could reasonably give rise to liability
under Environmental Laws except such releases or threats of releases which
could not reasonably be expected to have a Material Adverse Effect.
4.18 ACCURACY OF INFORMATION. No factual statement or
information contained in this Agreement, any other Loan Document, or any
other document, certificate or written statement furnished to the
Administrative Agent or the Lenders or any of them (including, without
limitation, the Recapitalization Documents), by or on behalf of any Loan
Party for use in connection with the transactions contemplated by this
Agreement or the other Loan Documents (including, without limitation, any
financial information furnished pursuant to Section 4.1), taken as a whole
contained as of the date such statement, information, document or
certificate was so furnished any untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
contained herein or therein in light of the circumstances in which it was
made not misleading. The projections and pro forma financial information
contained in the materials referenced above are based upon good faith
estimates and assumptions believed by management of the Borrower to be
reasonable at the time made, it being recognized by the Lenders that such
financial information as it relates to future events is not to be viewed as
fact and that actual results during the period or periods covered by such
financial information may differ from the projected results set forth
therein. There is no fact known to any Loan Party that could reasonably be
expected to have a Material Adverse Effect that has not been expressly
disclosed herein, in the other Loan Documents, or in such other documents,
certificates and statements furnished to the Administrative Agent for the
benefit of the Lenders (including, without limitation, the Recapitalization
Documents) for use in connection with the transactions contemplated hereby
and by the other Loan Documents.
4.19 SECURITY DOCUMENTS. (a) The Borrower Stock Pledge
Agreement is effective to create in favor of the Administrative Agent, for
the benefit of the Lenders, a legal, valid and enforceable security
interest in the Pledged Stock (as defined therein), and proceeds thereof
and, when the stock certificates representing the Pledged Stock are
delivered to the Administrative Agent, the Borrower Stock Pledge Agreement
shall constitute a fully perfected first priority Lien on, and security
interest in, all right, title and interest of the Borrower in such Pledged
Stock and the proceeds thereof, in each case (except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of creditors' rights generally) prior and
superior in right to any other Person.
(b) The Security Agreement is effective to create in favor of
the Administrative Agent, for the benefit of the Lenders, a legal, valid
and enforceable security interest in the Collateral described therein and
proceeds thereof; when financing statements in appropriate form are filed
in the offices specified on Schedule 4.19(b), except as set forth in the
Security Agreement, the Security Agreement constitutes a fully perfected
Lien on, and security interest in, all right, title and interest of the
Loan Parties in such Collateral and, to the extent provided therein, the
proceeds thereof, in each case (except as may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the
47
enforcement of creditors' rights generally) prior and superior in right to
any other Person, other than with respect to Liens expressly permitted by
subsection 7.3.
4.20 SOLVENCY. Each Loan Party is, and after giving effect to
the incurrence or assumption of all Indebtedness and obligations being
incurred or assumed in connection herewith and the Recapitalization will be
and will continue to be, Solvent.
SECTION 5. CONDITIONS PRECEDENT
5.1 CONDITIONS TO INITIAL EXTENSION OF CREDIT. The agreement of
each Lender to make the initial extension of credit requested to be made by
it is subject to the satisfaction, immediately prior to or concurrently
with the making of such extension of credit on the Closing Date, of the
following conditions precedent:
(a) LOAN DOCUMENTS; GUARANTEES. The Administrative Agent shall have
received (i) this Agreement, executed and delivered by a duly authorized
officer of the Borrower, with a counterpart for each Lender, (ii) the
Borrower Stock Pledge Agreement, executed and delivered by a duly
authorized officer of the Borrower, with a conformed copy for each Lender,
(iii) the Security Agreement, executed and delivered by a duly authorized
officer of each of the parties thereto, with a conformed copy for each
Lender, (iv) the Subsidiaries Guarantee, executed and delivered by a duly
authorized officer of each of the parties thereto, with a conformed copy
for each Lender, (v) the Depository Letters, each executed and delivered by
duly authorized officers of the parties thereto with a counterpart or
conformed copy for each Lender and (vi) the Collection Account Letters,
executed and delivered by duly authorized officers of the parties thereto
with a conformed copy for each Lender.
(b) RELATED AGREEMENTS. The Administrative Agent shall have
received, with a copy for each Lender, true and correct copies, certified
as to authenticity by the Borrower, of the Recapitalization Documents and
such other documents or instruments as may be reasonably requested by the
Administrative Agent, including, without limitation, a copy of any debt
instrument, security agreement or other material contract to which the
Borrower or any of its Subsidiaries may be a party.
(c) BORROWING CERTIFICATE. The Administrative Agent shall have
received, with a counterpart for each Lender, a certificate of the
Borrower, dated the Closing Date, substantially in the form of Exhibit G,
with appropriate insertions and attachments, satisfactory in form and
substance to the Administrative Agent, executed by a Responsible Officer.
(d) CORPORATE PROCEEDINGS OF THE BORROWER. The Administrative Agent
shall have received, with a counterpart for each Lender, a copy of the
resolutions, in form and substance satisfactory to the Administrative
Agent, of the Board of Directors of the Borrower authorizing (i) the
execution, delivery and performance of this Agreement and the other Loan
Documents to which it is a party, (ii) the borrowings contemplated
hereunder and (iii) the granting by it of the Liens created pursuant to the
Borrower Security Documents, certified by the Secretary or an Assistant
Secretary of
48
the Borrower as of the Closing Date, which certificate shall
be in form and substance satisfactory to the Administrative Agent and shall
state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded.
(e) BORROWER INCUMBENCY CERTIFICATE. The Administrative Agent shall
have received, with a counterpart for each Lender, a Certificate of the
Borrower, dated the Closing Date, as to the incumbency and signature of the
officers of the Borrower executing any Loan Document satisfactory in form
and substance to the Administrative Agent, executed by the President or any
Vice President and the Secretary or any Assistant Secretary of the
Borrower.
(f) CORPORATE PROCEEDINGS OF SUBSIDIARIES. The Administrative Agent
shall have received, with a counterpart for each Lender, a copy of the
resolutions, in form and substance satisfactory to the Administrative
Agent, of the Board of Directors of each Subsidiary of the Borrower which
is a party to a Loan Document authorizing (i) the execution, delivery and
performance of the Loan Documents to which it is a party and (ii) the
granting by it of the Liens created pursuant to the Security Documents to
which it is a party, certified by the Secretary or an Assistant Secretary
of each such Subsidiary as of the Closing Date, which certificate shall be
in form and substance satisfactory to the Administrative Agent and shall
state that the resolutions thereby certified have not been amended,
modified, revoked or rescinded.
(g) SUBSIDIARY INCUMBENCY CERTIFICATES. The Administrative Agent
shall have received, with a counterpart for each Lender, a certificate of
each Subsidiary of the Borrower which is a Loan Party, dated the Closing
Date, as to the incumbency and signature of the officers of such
Subsidiaries executing any Loan Document, satisfactory in form and
substance to the Administrative Agent, executed by the President or any
Vice President and the Secretary or any Assistant Secretary of each such
Subsidiary.
(h) CORPORATE DOCUMENTS. The Administrative Agent shall
have received, with a counterpart for each Lender, true and complete copies
of the certificate of incorporation and by-laws of each Loan Party,
certified as of the Closing Date as complete and correct copies thereof by
the Secretary or an Assistant Secretary of such Loan Party.
(i) CONSENTS, LICENSES AND APPROVALS. The Administrative Agent shall
have received, with a counterpart for each Lender, a certificate of a
Responsible Officer of the Borrower (i) attaching copies of all consents,
authorizations and filings referred to in subsection 4.4, and (ii) stating
that such consents, licenses and filings are in full force and effect, and
each such consent, authorization and filing shall be in form and substance
satisfactory to the Administrative Agent.
(j) FEES AND EXPENSES. The Lenders, the Administrative Agent and its
Affiliates shall have received all fees required to be paid, and all
expenses required to be paid for which invoices have been presented, on or
before the Closing Date.
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(k) LEGAL OPINIONS. The Administrative Agent shall have received,
with a counterpart for each Lender, the following executed legal
opinions:
(1) the executed legal opinion of Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx, special counsel to the Borrower and the other
Loan Parties, substantially in the form of Exhibit J-1;
(2) the executed legal opinion of Sheppard, Mullin,
Xxxxxxx & Hampton, LLP, special counsel to the Administrative Agent
and the Lenders in the State of California, substantially in the
form of Exhibit J-2;
(3) the executed legal opinion of Stoel, Rives, Boley,
Fraser & Wyse, special counsel to the Administrative Agent and the
Lenders in the State of Oregon, substantially in the form of
Exhibit J-3;
(4) the executed legal opinions of (i) Stikeman, Xxxxxxx;
and (ii) Xxxxxxxx Dorfman, Sweatman, counsel to the Administrative
Agent and the Lenders in Canada, substantially in the form of
Exhibit J-4.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require;
(l) PLEDGED STOCK; STOCK POWERS. The Administrative Agent shall have
received the certificates representing the shares pledged pursuant to the
Borrower Stock Pledge Agreement, together with an undated stock power for
each such certificate executed in blank by a duly authorized officer of the
Borrower.
(m) ACTIONS TO PERFECT LIENS. The Administrative Agent shall have
received evidence in form and substance satisfactory to it that all
filings, recordings, registrations and other actions, including, without
limitation, the filing of duly executed financing statements on form UCC-3
and form UCC-1, or their foreign equivalents, necessary or, in the opinion
of the Administrative Agent, desirable to perfect the Liens created by the
Security Documents shall have been completed or will be completed
immediately after the Closing Date.
(n) RECAPITALIZATION; CAPITAL STRUCTURE. (i) The Borrower shall have
issued at least $55,000,000 of its common stock and at least $25,000,000 of
its Existing Subordinated Debt, in each case, pursuant to the terms of the
Recapitalization Documents and of which at least $60,000,000, in aggregate,
shall have been received by the Borrower in cash on the Closing Date, all
on terms and conditions satisfactory in all material respects to the
Administrative Agent and the Lenders, and (ii) the capital structure of
each Loan Party after giving effect to the Recapitalization shall be
reasonably satisfactory in all material respects to the Administrative
Agent and the Lenders.
(o) FINANCIAL STATEMENTS. The Lenders shall have received unaudited
interim consolidated financial statements of the Borrower and its
consolidated Subsidiaries for each fiscal month and quarterly period ended
subsequent to the date of the latest
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financial statements previously delivered as to which such
financial statements are available, in form and substance reasonably
satisfactory to the Administrative Agent and the Lenders.
(p) PRO FORMA FINANCIAL STATEMENTS. The Lenders shall have received
a pro forma consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the date of the most recent consolidated balance sheet
delivered pursuant to paragraph (o) above, adjusted to give effect to the
consummation of the Recapitalization and the borrowings contemplated
hereunder as if such transactions had occurred on such date, in form and
substance reasonably satisfactory to the Administrative Agent and the
Lenders.
(q) LIEN SEARCHES. The Lenders shall have received the results of a
recent lien search in each relevant jurisdiction with respect to the
Borrower and its Subsidiaries, and such search shall reveal no Liens on any
of the assets of the Borrower or its Subsidiaries except for Liens
permitted by subsection 7.3 or Liens to be discharged on or prior to the
Closing Date pursuant to documentation in form and substance reasonably
satisfactory to the Administrative Agent.
(r) TRANSACTION FEES. The fees and expenses to be incurred by the
Borrower in connection with the Recapitalization and the financing thereof
(other than the High Yield Notes contemplated thereby) shall not exceed
$10,700,000 in the aggregate.
(s) ENVIRONMENTAL REPORT. The Lenders shall have received written
confirmation of the environmental report prepared by the Borrower and
previously reported to the Administrative Agent with respect to the real
property leased by the Borrower and its Subsidiaries.
(t) EXISTING CREDIT AGREEMENT. The Administrative Agent shall have
received evidence satisfactory to it that the Existing Credit Agreement
shall have been terminated and all amounts owing thereunder shall have been
paid in full.
(u) BORROWING BASE. (i) The Lenders shall be satisfied as to form
and substance with the calculation of the Borrowing Base and the forms of
the Borrowing Base Certificate and Supplemental Reporting on or before the
Closing Date and (ii) on the Closing Date and after giving effect to the
extensions of credit hereunder on the Closing Date, the Borrowing Base
shall exceed the Aggregate Covered Outstanding Revolving Extensions of
Credit by at least $8,000,000.
(v) INSURANCE. The Administrative Agent shall have received evidence
in form and substance satisfactory to it that all of the requirements of
subsection 6.5 and Section 4.2 of the Security Agreement shall have been
satisfied.
5.2 CONDITIONS TO EACH EXTENSION OF CREDIT. The agreement of each
Lender to make any extension of credit requested to be made by it on any date
(including, without limitation, its initial extension of credit) is subject to
the satisfaction of the following conditions precedent:
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(a) REPRESENTATIONS AND WARRANTIES. Each of the representations and
warranties made by the Borrower in or pursuant to the Loan Documents shall
be true and correct in all material respects on and as of such date as if
made on and as of such date.
(b) NO DEFAULT. No Default or Event of Default shall have occurred
and be continuing on such date or after giving effect to the extensions of
credit requested to be made on such date.
(c) ADDITIONAL MATTERS. All corporate and other proceedings, and all
documents, instruments and other legal matters in connection with the
transactions contemplated by this Agreement and the other Loan Documents
shall be reasonably satisfactory in form and substance to the
Administrative Agent in all material respects, and the Administrative Agent
shall have received such other documents and legal opinions in respect of
any aspect or consequence of the transactions contemplated hereby or
thereby as it shall reasonably request.
Each borrowing by and Letter of Credit issued on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date thereof that the conditions contained in this subsection have been
satisfied.
SECTION 6. AFFIRMATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect or any amount is owing to any Lender or the Administrative Agent
hereunder or under any other Loan Document, the Borrower shall and (except in
the case of delivery of financial information, reports and notices) shall cause
each of its Subsidiaries to:
6.1 FINANCIAL STATEMENTS. Furnish to each Lender:
(a) as soon as available, but in any event within 90 days after the
end of each fiscal year of the Borrower, a copy of the consolidated balance
sheet of the Borrower and its consolidated Subsidiaries as at the end of
such year and the related consolidated statements of income and retained
earnings and of cash flows for such year, in each case, using the last-in,
first-out inventory valuation method, and setting forth in comparative form
the figures for the previous year, reported on without a "going concern"
or like qualification or exception, or qualification arising out of the
scope of the audit, by KPMG Peat Marwick LLP or other independent certified
public accountants of nationally recognized standing; and
(b) as soon as available, but in any event not later than 45 days
after the end of each of the first three quarterly periods of each fiscal
year of the Borrower, the unaudited consolidated balance sheet of the
Borrower and its consolidated Subsidiaries as at the end of such quarter
and the related unaudited consolidated statements of income and retained
earnings and of cash flows of the Borrower and its consolidated
Subsidiaries for such quarter and the portion of the fiscal year through
the end of such quarter, in each case, using the first-in, first-out
inventory valuation method, and
52
setting forth in comparative form the figures for the previous year,
certified by a Responsible Officer as being fairly stated in all material
respects (subject to normal year-end audit adjustments); and
(c) as soon as available, but in any event not later than 30 days
after the end of each month of each fiscal year of the Borrower, the
unaudited consolidated balance sheet of the Borrower and its consolidated
Subsidiaries as at the end of such month and the related unaudited
consolidated statements of income and retained earnings and of cash flows
of the Borrower and its consolidated Subsidiaries for such month and the
portion of the fiscal year through the end of such month, in each case,
using the first-in, first-out inventory valuation method, and setting forth
in comparative form the figures for the previous year, certified by a
Responsible Officer as being fairly stated in all material respects
(subject to normal year-end audit adjustments);
all such financial statements shall be prepared in reasonable detail and in
accordance with GAAP applied consistently throughout the periods reflected
therein and with prior periods (except as approved by such accountants or
officer, as the case may be, and disclosed therein).
6.2 CERTIFICATES; OTHER INFORMATION. Furnish to the Administrative
Agent with copies for each Lender except as otherwise provided in clause (g)
below:
(a) concurrently with the delivery of the financial statements
referred to in subsection 6.1(a), a certificate of the independent
certified public accountants reporting on such financial statements stating
that in making the examination necessary therefor no knowledge was obtained
of any Default or Event of Default, except as specified in such
certificate;
(b) subject to the proviso below, concurrently with the delivery of
the financial statements referred to in subsections 6.1(a), (b) and (c), a
certificate of a Responsible Officer (1) stating that, to the best of such
Officer's knowledge, during such period (i) no Subsidiary has been formed
or acquired (or, if any such Subsidiary has been formed or acquired, the
Borrower has complied with the requirements of subsection 6.12 with respect
thereto), (ii) neither the Borrower nor any of its Subsidiaries has changed
its name, its principal place of business, its chief executive office or
the location of any material item of tangible Collateral without complying
with the requirements of this Agreement and the Security Documents with
respect thereto and (iii) the Borrower has observed or performed in all
material respects all of its covenants and other agreements, and satisfied
every condition, contained in this Agreement and the other Loan Documents
to be observed, performed or satisfied by it, and that such Officer has
obtained no knowledge of any Default or Event of Default except as
specified in such certificate; provided that with respect to the financial
statements delivered pursuant to subsection 6.1(c), such certificate need
only cover the items set forth in clause (i) above, and (2) in the case of
the financial statements delivered pursuant to subsections 6.1(a) and (b)
setting forth, in reasonable detail, a calculation of the financial
covenants set forth in subsection 7.1 for the period corresponding to such
financial statements; and, with respect to the annual financial statements
required to be furnished pursuant to subsection 6.1(a), a reconciliation of
53
such financial statements from the last-in first-out inventory valuation
method to the first-in, first-out inventory valuation method in order to
calculate the financial covenants set forth in subsection 7.1, all in
substantially the form set forth on Exhibit H (THE "RESPONSIBLE OFFICER'S
CERTIFICATE").
(c) not later than 10 days prior to the end of each fiscal year of
the Borrower, a copy of the projections by the Borrower of the operating
budget and cash flow budget of the Borrower and its Subsidiaries for the
succeeding fiscal year using the first-in, first-out inventory valuation
method, such projections to be accompanied by a certificate of a
Responsible Officer to the effect that such projections have been prepared
on the basis of sound financial planning practice and that such Responsible
Officer has no reason to believe they are incorrect or misleading in any
material respect;
(d) promptly upon receipt thereof, copies of all reports submitted to
the Borrower or any of its Subsidiaries by KPMG Peat Marwick or any other
independent accountants of the Borrower or any such Subsidiary in
connection with each annual, interim or special audit of its financial
statements made by such accountants (including, without limitation, any
comment letter submitted by such accountants to management of the Borrower
or any such Subsidiary in connection with their annual audit and any
reports addressing internal accounting controls of the Borrower or such
Subsidiary submitted by such accountants), and, promptly upon completion
thereof, copies of any response report from the Borrower or such Subsidiary
to such accountants;
(e) within five days after the same are filed, copies of all
financial statements and reports which the Borrower may make to, or file
with, the Securities and Exchange Commission or any successor or analogous
Governmental Authority, and at such time, if any, that the Borrower becomes
subject to the reporting requirements of the Securities Exchange Act of
1934, as amended, within five days after the same are sent, copies of all
financial statements and reports which the Borrower sends to its
stockholders;
(f) promptly, but in no event later than 1:00 P.M., New York City
time, on the third Business Day following the end of each calendar week,
UNLESS such third Business Day falls in the last week of a calendar month,
in which case, in no event later than 1:00 P.M., New York City time, on the
third Business Day of the next calendar month, a Borrowing Base
Certificate, certifying in reasonable detail the Borrowing Base as of the
close of business on the last calendar day of the immediately preceding
calendar week or calendar month, as the case may be, and in each case, a
copy to the Administrative Agent of a Supplemental Reporting presenting the
Borrower's computation thereof. Each Borrowing Base Certificate shall
remain in effect from and including the date on which such Borrowing Base
Certificate is delivered, to, but excluding, the date on which the next
Borrowing Base Certificate is delivered; and
(g) promptly, furnish to the Administrative Agent or any Lender such
additional financial and other information with respect to the business or
operations of
54
the Borrower and its Subsidiaries as the Administrative Agent or such
Lender may from time to time reasonably request.
6.3 PAYMENT OF OBLIGATIONS. Pay, discharge or otherwise satisfy at
or before maturity or before they become delinquent, as the case may be, all its
obligations of whatever nature, except where the amount or validity thereof is
currently being contested in good faith by appropriate proceedings and reserves
in conformity with GAAP with respect thereto have been provided on the books of
the Borrower or its Subsidiaries, as the case may be.
6.4 CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Continue to
engage in business of the same general type as now conducted by it or businesses
reasonably related thereto; preserve, renew and keep in full force and effect
its corporate existence and take all reasonable action to maintain all rights,
privileges and franchises necessary or desirable in the normal conduct of its
business except as otherwise permitted pursuant to subsection 7.5 and except to
the extent that failure to comply with the foregoing would not, in the
aggregate, be reasonably expected to have a Material Adverse Effect; comply with
all Contractual Obligations and Requirements of Law except to the extent that
failure to comply therewith could not, in the aggregate, be reasonably expected
to have a Material Adverse Effect.
6.5 MAINTENANCE OF PROPERTY; INSURANCE. Keep all tangible property
useful and necessary in its business in good working order and condition;
maintain with financially sound and reputable insurance companies insurance on
all its tangible property in at least such amounts and against at least such
risks (but including in any event public liability, product liability and
business interruption) as are usually insured against in the same general area
by companies engaged in the same or a similar business; and furnish to the
Administrative Agent with copies for each Lender, upon written request, full
information as to the insurance carried.
6.6 INSPECTION OF PROPERTY; BOOKS AND RECORDS; DISCUSSIONS.
Keep proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made
of all dealings and transactions in relation to its business and
activities; and permit representatives of any Lender to visit and inspect
any of its properties and examine and make abstracts from any of its books
and records at any reasonable time during normal business hours and as
often as may reasonably be desired and to discuss the business, operations,
properties and financial and other condition of the Borrower and its
Subsidiaries with officers and employees of the Borrower and its
Subsidiaries and with its independent certified public accountants;
provided that such inspection shall be conducted in a manner that does not
unreasonably interfere with the business or operations of the Borrower or
its Subsidiaries.
6.7 SEMI-ANNUAL REVIEWS. At any time upon the request of the
Administrative Agent, permit the Administrative Agent or professionals
(including investment bankers, consultants, accountants, lawyers and
appraisers) retained by the Administrative Agent to conduct evaluations and
appraisals (at a reasonable time during normal business hours provided that
the following is conducted in a manner that does not unreasonably interfere
with the business or operations of the Borrower or its Subsidiaries) of (i)
the Borrower's practices in the computation of the Borrowing Base, (ii) the
assets included in the Borrowing Base, (iii) systems and procedures related
to Borrowing Base items, (iv) other related procedures deemed necessary by
the Administrative Agent, and pay the reasonable
55
fees and expenses in connection therewith (including, without
limitation, the reasonable fees and expenses associated with services performed
by the Administrative Agent's Collateral Monitoring Department); provided,
however, that such persons shall not be entitled to conduct such evaluations and
appraisals of assets more frequently than twice per year unless (x) a Default or
Event of Default has occurred and is continuing or (y) the Administrative Agent
or the Majority Lenders determine that any material event or material change has
occurred with respect to the Loan Parties, their inventory or receivables
practices or the performance of the Collateral and that as a result of such
event or change more frequent evaluations or appraisals are required to
effectively monitor the Borrowing Base, in which case the Borrower will permit
such Persons to conduct such evaluations and appraisals at such reasonable times
during normal business hours and as often as may be reasonably requested;
provided that such inspection shall be conducted in a manner that does not
unreasonably interfere with the business or operations of the Borrower or its
Subsidiaries.
6.8 NOTICES. Promptly give notice to the Administrative Agent with
copies for each Lender of (to the extent it has knowledge of same):
(a) the occurrence of any Default or Event of Default;
(b) any (i) default or event of default under any Contractual
Obligation of the Borrower or any of its Subsidiaries or (ii) litigation,
investigation or proceeding which may exist at any time between the
Borrower or any of its Subsidiaries and any Governmental Authority, which
in either case, if not cured or if adversely determined, as the case may
be, could reasonably be expected to have a Material Adverse Effect;
(c) any litigation or proceeding affecting the Borrower or any of its
Subsidiaries in which the amount involved is $2,000,000 or more and not
covered by insurance or with respect to which the Borrower or its
Subsidiaries is not fully indemnified by a third party or in which
injunctive or similar relief is sought;
(d) the following events, as soon as possible and in any event within
30 days after the Borrower knows or has reason to know thereof: (i) the
occurrence or expected occurrence of any Reportable Event with respect to
any Plan, a failure to make any required contribution to a Plan, the
creation of any Lien in favor of the PBGC or a Plan or any withdrawal from,
or the termination, Reorganization or Insolvency of, any Multiemployer Plan
or (ii) the institution of proceedings or the taking of any other action by
the PBGC or the Borrower or any Commonly Controlled Entity or any
Multiemployer Plan with respect to the withdrawal from, or the terminating,
Reorganization or Insolvency of, any Plan; and
(e) any development or event which has had or which the Borrower
believes could reasonably be expected to have a Material Adverse Effect.
Each notice pursuant to this subsection shall be accompanied by a statement of a
Responsible Officer setting forth details of the occurrence referred to therein
and stating what action the Borrower proposes to take with respect thereto.
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6.9 ENVIRONMENTAL LAWS. (a) Comply with, and use diligent efforts
to ensure compliance by all tenants and subtenants, if any, with, all applicable
Environmental Laws and obtain and comply in all material respects with and
maintain, and use diligent efforts to ensure that all tenants and subtenants
obtain and comply in all material respects with and maintain, any and all
licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws, except, in either case to the extent that failure
to do so could not be reasonably expected to have a Material Adverse Effect.
(b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply in all material respects with all lawful
orders and directives of all Governmental Authorities regarding Environmental
Laws except to the extent that the same are being contested in good faith by
appropriate proceedings and the pendency of such proceedings could not be
reasonably expected to have a Material Adverse Effect.
6.10 FURTHER ASSURANCES. Upon the request of the Administrative
Agent, promptly perform or cause to be performed any and all acts and execute or
cause to be executed any and all documents (including, without limitation,
financing statements and continuation statements) for filing under the
provisions of the Uniform Commercial Code or any other Requirement of Law which
are necessary or advisable to maintain in favor of the Administrative Agent, for
the benefit of the Lenders, Liens on the Collateral that are duly perfected in
accordance with all applicable Requirements of Law.
6.11 CASH MANAGEMENT SYSTEM. Maintain (i) the US Cash Collateral
Account into which all proceeds of Collateral payable in the United States are
deposited (including any amounts paid to the Borrower or any of its Subsidiaries
and required pursuant to the Security Agreement, to be deposited by the Borrower
and its Subsidiaries into the Collection Accounts or the Depository Accounts)
with the Administrative Agent and (ii) the Canadian Cash Collateral Account and
the Deposit Accounts into which all proceeds of Collateral payable in Canada are
paid (including any amounts paid to the Borrower or any of its Subsidiaries and
required pursuant to the Security Agreement to be deposited by the Borrower and
its Subsidiaries into the Canadian Cash Collateral Account or the Deposit
Accounts) with Bank of Montreal, or, in each case, one or more banks reasonably
acceptable to the Administrative Agent that have acknowledged the assignment of
such accounts to the Administrative Agent pursuant to the Depository Letters,
the Collection Accounts Letters or the Deposit Account Letters and the Security
Agreement, as the case may be, and maintain cash management systems reasonably
acceptable to the Majority Lenders.
At the beginning of each Business Day, transfer to the US Cash
Collateral Account such amounts of Canadian dollars as shall be necessary to
cause the aggregate amount of available funds on deposit in the Canadian Cash
Collateral Account and the Deposit Accounts not to exceed $30,000,000 Canadian
dollars.
6.12 ADDITIONAL COLLATERAL. (a) With respect to any assets acquired
after the Closing Date by the Borrower or any of its Subsidiaries that are
intended to be subject to the Lien created by any of the Security Documents but
which are not so subject (other than any assets described in paragraph (b) or
(c) of this subsection and assets that, in the judgment of the Administrative
Agent are immaterial or a Lien on which cannot be perfected by filing
57
UCC-1 financing statements or their foreign equivalents), promptly (and in
any event within 30 days after the acquisition thereof): (i) execute and
deliver to the Administrative Agent such amendments to the relevant Security
Documents or such other documents as the Administrative Agent shall
reasonably deem necessary or advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a Lien on such assets, (ii) take all actions
necessary or advisable to cause such Lien to be duly perfected in accordance
with all applicable Requirements of Law, including, without limitation, the
filing of financing statements in such jurisdictions as may be reasonably
requested by the Administrative Agent, and (iii) if requested by the
Administrative Agent, deliver to the Administrative Agent legal opinions
relating to the matters described in clauses (i) and (ii) immediately
preceding, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.
(b) With respect to any Person that, subsequent to the Closing Date,
becomes an active Subsidiary, promptly upon the request of the Administrative
Agent: (i) execute and deliver to the Administrative Agent, for the benefit of
the Lenders, a new pledge agreement or such amendments to the relevant Pledge
Agreement as the Administrative Agent shall reasonably deem necessary or
advisable to grant to the Administrative Agent, for the benefit of the Lenders,
a Lien on the Capital Stock of such Subsidiary (unless such Subsidiary is a
foreign Subsidiary in which case, 66% of the Capital Stock of such foreign
subsidiary) which is owned by the Borrower or any of its Subsidiaries, (ii)
deliver to the Administrative Agent the certificates representing such Capital
Stock, together with undated stock powers executed and delivered in blank by a
duly authorized officer of the Borrower or such Subsidiary, as the case may be,
(iii) cause such new Subsidiary (A) to become a party to the Subsidiary
Guarantee and the Security Agreement, in each case pursuant to documentation
which is in form and substance satisfactory to the Administrative Agent, and (B)
to take all actions necessary or advisable to cause the Lien created by the
Security Agreement to be duly perfected in accordance with all applicable
Requirements of Law, including, without limitation, the filing of financing
statements in such jurisdictions as may be reasonably requested by the
Administrative Agent and (iv) if requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the matters described in
clauses (i), (ii) and (iii) immediately preceding, which opinions shall be in
form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
6.13 TAX STAMP BONDING. Maintain surety bonds if and to the extent
required by law (including, with respect to amounts) with respect to all tobacco
tax stamps not paid for on a cash basis.
6.14 COMPLIANCE WITH TERMS OF LEASEHOLDS. Make all payments and
otherwise perform all material obligations in respect of all leases of real
property to which the Borrower or any of its Subsidiaries is a party, keep such
leases in full force and effect and not allow such leases to lapse or be
terminated or any rights to renew such leases to be forfeited or cancelled if
the failure to make such payments or perform such obligations, to keep such
lease in full force and effect, or the lapse, termination or failure to renew
would reasonably be likely to result in a Material Adverse Effect, notify the
Administrative Agent of any default by any party of which the Borrower has
actual knowledge with respect to such leases and cooperate with the
Administrative Agent in all respects to cure any such default, and cause each of
its Subsidiaries to do so.
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SECTION 7. NEGATIVE COVENANTS
The Borrower hereby agrees that, so long as the Commitments remain in
effect or any amount is owing to any Lender or the Administrative Agent
hereunder or under any other Loan Document, the Borrower shall not, and shall
not permit any of its Subsidiaries to, directly or indirectly:
7.1 FINANCIAL CONDITION COVENANTS.
(a) MAINTENANCE OF CURRENT RATIO. Permit the ratio of Consolidated
Current Assets of the Borrower to Consolidated Current Liabilities of the
Borrower at any time during any period set forth below to be less than the
ratio set forth opposite such period below:
PERIOD RATIO
9/30/96 - 6/30/01 1.40 to 1.00
(b) MAINTENANCE OF NET WORTH. (i) Permit Consolidated Net Worth of
the Borrower at any time during the period from August 7, 1996 to March 30,
1997 to be less than ($3,000,000) or, with respect to any time during the
period from December 31, 1996 to March 30, 1997 to be less than
($5,000,000) if such lower Consolidated Net Worth amount is due solely to
accounting adjustments and/or costs and expenses related to the
Recapitalization or the issuance of the High Yield Notes and (ii) permit
Consolidated Net Worth of the Borrower at any time during the period from
March 31, 1997 to June 30, 2001 to be less than an amount equal to
Consolidated Net Worth of the Borrower as at December 31, 1996 PLUS the
aggregate of 50% of Consolidated Net Income of the Borrower, if positive,
for each quarter during the period commencing on January 1, 1997 and ending
at the close of the fiscal quarter then last ended.
(c) MAINTENANCE OF SENIOR DEBT LEVERAGE RATIO. Permit the ratio of
(i) Consolidated Senior Debt of the Borrower at the last day of any fiscal
quarter ending during any "Test Period" set forth below to (ii)
Consolidated EBITDA for the period of four consecutive fiscal quarters
ending on such date to be greater than the amount set forth opposite such
period below:
TEST PERIOD RATIO
9/30/96 - 9/30/97 5.25 to 1.00
12/31/97 - 9/30/98 4.75 to 1.00
12/31/98 - 9/30/99 4.25 to 1.00
12/31/99 - 9/30/00 3.75 to 1.00
12/31/00 - 6/30/01 3.25 to 1.00
59
; provided, however, that from and after the date of the issuance by
the Borrower of the High Yield Notes in an aggregate principal amount of at
least $75 million, notwithstanding the ratios set forth above, the
following ratios shall apply:
TEST PERIOD RATIO
9/30/96 - 9/30/97 4.25 to 1.00
12/31/97 - 9/30/98 4.00 to 1.00
12/31/98 - 6/30/01 3.75 to 1.00
For purposes of computing Consolidated Senior Debt of the Borrower,
the amount of Revolving Credit Loans included therein as of the last day of
a fiscal quarter shall be the average daily outstanding principal amount
thereof for the period of two consecutive fiscal quarters ending on such
date (or, if shorter, the period commencing on the Closing Date and ending
on such date).
(d) MAINTENANCE OF MINIMUM EBITDA. Permit Consolidated EBITDA of
the Borrower for the four quarters ending at the last day of any period set
forth below to be less than the amount set forth opposite such period
below:
Test Period Amount
9/30/96 - 12/31/96 $30,000,000
3/31/97 - 6/30/97 $31,000,000
9/30/97 - 12/31/97 $32,000,000
3/31/98 - 6/30/98 $33,500,000
9/30/98 - 12/31/98 $35,000,000
3/31/99 - 6/30/99 $36,500,000
9/30/99 - 12/31/99 $38,000,000
3/31/00 - 6/30/00 $40,000,000
9/30/00 - 12/31/00 $42,000,000
3/31/01 - 6/30/01 $43,500,000
(e) Maintenance of Interest Coverage. Permit for any period of four
consecutive fiscal quarters ending during any "Test Period" set forth below
the ratio of (i) Consolidated EBITDA of the Borrower to (ii) Consolidated
Cash Interest Expense of the Borrower for such period to be less than the
ratio set forth opposite such period below after giving effect to the
Interim Adjustments for the calculations occurring on September 30, 1996,
December 31, 1996 and March 31, 1997:
Test Period Ratio
9/30/96 - 9/30/98 2.00 to 1.00
12/31/98 - 9/30/99 2.25 to 1.00
12/31/99 - 9/30/00 2.50 to 1.00
12/31/00 - 6/30/01 3.00 to 1.00
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; provided, however, that from and after the date of the issuance by
the Borrower of the High Yield Notes in an aggregate principal amount of at
least $75 million, notwithstanding the ratios set forth above, the
following ratios shall apply:
Test Period Ratio
9/30/96 - 9/30/98 1.65 to 1.00
12/31/98 - 9/30/99 1.75 to 1.00
12/31/99 - 9/30/00 2.00 to 1.00
12/31/00 - 6/30/01 2.25 to 1.00
7.2 LIMITATION ON INDEBTEDNESS. Create, incur, assume or suffer to
exist any Indebtedness, except:
(a) Indebtedness of the Borrower under this Agreement;
(b) Indebtedness of the Borrower to any Subsidiary and of any
Subsidiary to the Borrower or any other Subsidiary;
(c) Existing Subordinated Debt;
(d) Indebtedness of the Borrower and any of its Subsidiaries incurred
to finance the acquisition of fixed or capital assets (whether pursuant to
a loan, a Financing Lease or otherwise) in an aggregate principal amount
not exceeding as to the Borrower and its Subsidiaries $5 million at any
time outstanding;
(e) Indebtedness outstanding on the date hereof and listed on
Schedule 7.2 and any refinancings, refundings, renewals or extensions
thereof; provided that the aggregate principal amount set forth on Schedule
7.2 does not increase in connection with any such refinancing, refunding,
renewal or extension;
(f) Indebtedness in respect of Hedge Agreements designed to hedge
against fluctuations in interest rates or foreign exchange rates incurred
in the ordinary course of business and consistent with prudent business
practice in an aggregate notional amount not to exceed $75,000,000, in the
case of the interest rate Hedge Agreements, and $30,000,000, in the case of
foreign exchange rate Hedge Agreements, at any time outstanding;
(g) additional Indebtedness of the Borrower and its Subsidiaries (not
otherwise described in this Section 7.2) not exceeding $3 million in
aggregate principal amount at any one time outstanding;
(h) Indebtedness constituting Subordinated Debt in an aggregate
principal amount not to exceed $100 million (the "High Yield Notes")
provided that the proceeds (or part thereof) of any such Indebtedness are
used to repay the Term Loans in accordance with subsection 2.9;
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(i) Subordinated Debt of the Borrower (other than the Existing
Shareholders Debt and the High Yield Notes) in an aggregate principal
amount not to exceed $2,000,000 at any one time outstanding;
(j) Indebtedness in respect of the conditional sale of coffee
machines and similar fast food equipment where the Borrower or its
Subsidiaries guarantee the purchase price of such equipment in the event
the purchaser of such equipment does not purchase such equipment through
coffee and food purchases;
(k) Indebtedness in respect of state cigarette stamp tax and other
bonds incurred in the ordinary course of business on a basis consistent
with past practice;
(l) Indebtedness in respect of letters of credit which are
denominated in Canadian dollars and issued for the account of the Borrower,
in an aggregate face amount not to exceed $5 million Canadian dollars;
provided, that any such letter of credit is supported by a Letter of
Credit;
(m) Indebtedness of the type described in clause (f) of the
definition of "Indebtedness" which is secured by Liens permitted under
subsection 7.3; and
(n) Indebtedness assumed in connection with Permitted Acquisitions,
provided that such Indebtedness was not incurred in anticipation of the
Permitted Acquisition and, in any case, not to exceed $500,000 in the
aggregate.
7.3 LIMITATION ON LIENS. Create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, except for:
(a) Liens for taxes not yet due or which are being contested in good
faith by appropriate proceedings, PROVIDED that adequate reserves with
respect thereto are maintained on the books of the Borrower or its
Subsidiaries, as the case may be, in conformity with GAAP;
(b) carriers', warehousemen's, mechanics', materialmen's,
repairmen's, landlord's or other like Liens arising in the ordinary course
of business for amounts which are not overdue for a period of more than 60
days or which are being contested in good faith by appropriate proceedings;
(c) pledges or deposits in connection with workers' compensation,
unemployment insurance and other social security legislation;
(d) deposits to secure the performance of bids, trade contracts
(other than for borrowed money), leases, statutory obligations, surety and
appeal bonds, performance bonds and other obligations of a like nature
incurred in the ordinary course of business;
(e) easements, rights-of-way, restrictions, restrictive covenants,
encroachments and other similar encumbrances incurred in the ordinary
62
course of business which, in the aggregate, are not substantial in amount
and which do not in any case materially detract from the value of the
property subject thereto or materially interfere with the ordinary conduct
of the business of the Borrower or such Subsidiary;
(f) Liens in existence on the date hereof listed on Schedule 7.3,
securing Indebtedness permitted by subsection 7.2(e) and new Liens created
after the Closing Date in connection with refinancings, refundings,
renewals, and extensions described in subsection 7.2(e), PROVIDED that no
such Lien is spread to cover any additional property after the Closing Date
and that the principal amount of Indebtedness secured thereby is not
increased;
(g) Liens securing Indebtedness of the Borrower and its Subsidiaries
permitted by subsection 7.2(d) incurred to finance the acquisition of fixed
or capital assets, PROVIDED that (i) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (ii) such Liens do not at any time encumber any property other than
the property financed by such Indebtedness, (iii) the principal amount of
Indebtedness secured thereby is not increased and (iv) the principal amount
of Indebtedness secured by any such Lien shall at no time exceed the
original purchase price of such property at the time it was acquired;
(h) Liens created pursuant to the Security Documents;
(i) Liens arising under licensing agreements entered into by the
Borrower or any Subsidiaries in the ordinary course of business for the use
of Intellectual Property or other intangible assets of the Borrower or any
Subsidiary, and any consents to use, and other similar agreements
concerning Intellectual Property or other intangible assets or judgments
adjudicating rights in any intangible rights in Intellectual Property or
other intangible assets; and
(j) Liens securing Indebtedness of the Borrower and its Subsidiaries
permitted by subsection 7.2(b).
7.4 Limitation on Guarantee Obligations. Create, incur, assume or
suffer to exist any Guarantee Obligation except:
(a) Guarantee Obligations in existence on the date hereof and listed
on Schedule 7.4 and refinancings, renewals or extensions thereof, provided
that the aggregate principal amount set forth on Schedule 7.4 does not
increase in connection with any such refinancing, renewal or extension;
(b) guarantees made in the ordinary course of its business by the
Borrower of obligations of any Subsidiary of Indebtedness permitted by
subsections 7.2(d), (e) and (f) or any leases for real property by any
Subsidiary; and
(c) the Subsidiaries Guarantee.
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7.5 LIMITATION ON FUNDAMENTAL CHANGES. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution), or convey, sell, lease, assign, transfer
or otherwise dispose of, all or substantially all of its property, business or
assets, or make any material change in its present method of conducting
business, except:
(a) any Subsidiary of the Borrower may be merged or consolidated with
or into, or be liquidated, wound up or dissolved into, the Borrower
(PROVIDED that the Borrower shall be the continuing or surviving
corporation) or with or into any one or more wholly owned Subsidiaries of
the Borrower (PROVIDED that the wholly owned Subsidiary or Subsidiaries
shall be the continuing or surviving corporation);
(b) subject to subsections 7.10(c) and (d), the Borrower or any
Subsidiary may be merged or consolidated with any other Person organized
under a jurisdiction of the United States with assets held primarily in the
United States; PROVIDED, that the Borrower or such Subsidiary shall be the
continuing or surviving corporation; the Administrative Agent is provided
with written notice, and after giving effect thereto no Default or Event of
Default would exist or reasonably be expected to be caused thereby; and
(c) any wholly owned Subsidiary may sell, lease, transfer or
otherwise dispose of any or all of its assets (upon voluntary liquidation
or otherwise) to the Borrower or any other wholly owned Subsidiary of the
Borrower.
7.6 LIMITATION ON SALE OF ASSETS. Convey, sell, lease, assign,
transfer or otherwise dispose of any of its property, business or assets
(including, without limitation, receivables and leasehold interests), whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary's Capital Stock to any Person other than the
Borrower or any wholly owned Subsidiary, except:
(a) the sale or other disposition of obsolete or worn out property in
the ordinary course of business;
(b) the sale or other disposition of any property in the ordinary
course of business, provided that (other than inventory) the aggregate book
value of all assets so sold or disposed of in any period of twelve
consecutive months shall not exceed $500,000;
(c) the sale of inventory in the ordinary course of business;
(d) the sale or discount without recourse of accounts receivable
arising in the ordinary course of business in connection with the
compromise or collection thereof; and
(e) the sale, abandonment or other disposition in the ordinary course
of business of Intellectual Property that is no longer necessary for the
conduct of the business of the Borrower or any Subsidiary; and
(f) as permitted by subsection 7.5.
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7.7 LIMITATION ON SPECULATIVE TRANSACTIONS. Engage, or permit any of
its Subsidiaries to engage, in any transaction involving commodity options or
futures contracts or any similar speculative transactions (including, without
limitation, take-or-pay contracts) except for Hedge Agreements permitted under
subsection 7.2(f).
7.8 LIMITATION ON DIVIDENDS. Declare or pay any dividend (other than
dividends payable solely in common stock of the Borrower) on, or make any
payment on account of, or set apart assets for a sinking or other analogous fund
for, the purchase, redemption, defeasance, retirement or other acquisition of,
any shares of any class of Capital Stock of the Borrower or any warrants or
options to purchase any such Stock, whether now or hereafter outstanding, or
make any other distribution in respect thereof, either directly or indirectly,
whether in cash or property or in obligations of the Borrower or any Subsidiary
(such declarations, payments, setting apart, purchases, redemptions,
defeasances, retirements, acquisitions and distributions being herein called
"RESTRICTED PAYMENTS"), except that if no Default or Event of Default exists or
would reasonably be expected to be caused thereby, the Borrower may repurchase
shares of its common stock from its employees and former employees so long as
the aggregate amount of all such repurchases since the date of this Agreement
does not exceed $1 million.
7.9 LIMITATION ON CAPITAL EXPENDITURES. Make or commit to make (by
way of the acquisition of securities of a Person or otherwise) any expenditure
in respect of the purchase or other acquisition of fixed or capital assets
except for expenditures in the ordinary course of business not exceeding, in the
aggregate for the Borrower and its Subsidiaries, $8,500,000, for each fiscal
year, PROVIDED, that up to $1,500,000 of any such amount if not so expended in
the fiscal year for which it is permitted above, may be carried over for
expenditure in the next following fiscal year.
7.10 LIMITATION ON INVESTMENTS, Loans and Advances. Make any
advance, loan, extension of credit or capital contribution to, or purchase any
stock, bonds, notes, debentures or other securities of or any assets
constituting a business unit of, or make any other investment in, any Person,
except :
(a) extensions of trade credit in the ordinary course of business;
(b) investments in US Cash Equivalents and Canadian Cash Equivalents;
(c) investments constituting Permitted Acquisitions; provided, that
at the date of signing of definitive documentation with respect to such
proposed Permitted Acquisition, (i) the Term Loans shall have been repaid
in full, (ii) the Uncovered L/C Amount shall have been permanently reduced
to zero, (iii) the Overadvance Limit shall have been permanently reduced to
zero and (iv) the lesser of (1) the available Borrowing Base and (2) the
Available Revolving Credit Commitments shall be at least $15,000,000
determined on the basis of the average amount of the Borrowing Base and the
Aggregate Outstanding Revolving Extensions of Credit, respectively, during
the calendar month preceding the date such definitive documentation is
signed;
(d) investments constituting Permitted Acquisitions in an aggregate
amount not to exceed $25,000,000; provided, that at the date of signing of
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definitive documentation with respect to such proposed Permitted
Acquisition, (i) the Term Loans shall have been repaid in full, (ii) the
Overadvance Limit shall have been permanently reduced to zero and (iii) the
lesser of (1) the available Borrowing Base and (2) the Available Revolving
Credit Commitments shall be at least $15,000,000 determined on the basis of
the average amount of the Borrowing Base and the Aggregate Outstanding
Revolving Extensions of Credit, respectively, during the calendar month
preceding the date such definitive documentation is signed;
(e) loans and advances to employees of the Borrower or its
Subsidiaries for travel, entertainment and relocation expenses in the
ordinary course of business in an aggregate amount for the Borrower and its
Subsidiaries not to exceed $500,000 at any one time outstanding;
(f) investments by the Borrower and its Subsidiaries in securities
and notes to the extent received in settlement of delinquent obligations of
any supplier or customer that is in bankruptcy or reorganization
proceedings or received in settlement of accounts receivables that are more
than 60 days past due;
(g) the acquisition by the Borrower described in a letter dated
August 1, 1996, from Xxxxxx Xxxxx to Xxxxxxx Xxxxxx, and previously
distributed to the Lenders; provided that the aggregate purchase price of
such acquisition does not exceed $2 million;
(h) investments by the Borrower in its Subsidiaries and investments
by such Subsidiaries in the Borrower and in other Subsidiaries; and
(i) subject to the limitations set forth in subsection 7.2(f),
investments constituting Hedge Agreements.
7.11 LIMITATION ON OPTIONAL PAYMENTS AND MODIFICATIONS OF DEBT
INSTRUMENTS. (a) Make any optional payment or prepayment on or
redemption or purchase of any Indebtedness (other than (1) the Loans and (2)
a refinancing of Indebtedness permitted by subsection 7.2(e)), or (b) amend,
modify or change, or consent or agree to any amendment, modification or change
to any of the terms of any such Indebtedness (other than any such amendment,
modification or change which would extend the maturity or reduce the amount of
any payment of principal thereof or which would reduce the rate or extend the
date for payment of interest thereon); provided that the proceeds of the High
Yield Notes in excess of the amount required to prepay the Term Loans in
accordance with subsection 2.9(a) may be used to redeem the Existing
Subordinated Debt.
7.12 LIMITATION ON TRANSACTIONS WITH AFFILIATES. Enter into any
transaction, including, without limitation, any purchase, sale, lease or
exchange of property or the rendering of any service, with any Affiliate unless
such transaction is (a) otherwise not prohibited under this Agreement, and
(b) upon fair and reasonable terms no less favorable to the Borrower or such
Subsidiary, as the case may be, than it would obtain in a comparable arm's
length transaction with a Person which is not an Affiliate.
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7.13 LIMITATION ON SALES AND LEASEBACKS. Enter into any arrangement
with any Person 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 such Subsidiary to such Person or to any other Person to whom funds
have been or are to be advanced by such Person on the security of such property
or rental obligations of the Borrower or such Subsidiary.
7.14 LIMITATION ON CHANGES IN FISCAL YEAR. Permit the fiscal year of
the Borrower to end on a day other than December 31.
7.15 LIMITATION ON NEGATIVE PLEDGE CLAUSES. Enter into with any
Person any agreement, other than (a) this Agreement, (b) any Indebtedness
permitted by subsection 7.2(d) (in which case, any prohibition or limitation
shall only be effective against the assets financed thereby), and (c) any
refinancing, refunding, renewal or extension permitted by subsection 7.2(e) (in
which case any prohibition or limitation shall not be more restrictive than the
prohibition or limitation contained in the Indebtedness that was so refinanced,
refunded, renewed or extended), which prohibits or limits the ability of the
Borrower or any of its Subsidiaries to create, incur, assume or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired.
7.16 LIMITATION ON LINES OF BUSINESS. Enter into any business,
either directly or through any Subsidiary, except for those businesses in which
the Borrower and its Subsidiaries are engaged on the date of this Agreement or
businesses reasonably related thereto.
SECTION 8. EVENTS OF DEFAULT
If any of the following events shall occur and be continuing:
(a) The Borrower shall fail to pay any principal of any Loan or any
Reimbursement Obligation when due in accordance with the terms thereof or
hereof; or the Borrower shall fail to pay any interest on any Loan, or any
other amount payable hereunder, within five days after any such interest or
other amount becomes due in accordance with the terms thereof or hereof; or
(b) Any representation or warranty made or deemed made by the
Borrower herein or in any other Loan Document or which is contained in any
certificate, document or financial or other statement furnished by it at
any time under or in connection with this Agreement or any such other Loan
Document shall prove to have been incorrect in any material respect on or
as of the date made or deemed made; or
(c) The Borrower or any other Loan Party shall default in the
observance or performance of any agreement contained in subsections 6.4,
6.8, 6.11 (other than as a result of wire transfer difficulties or system
malfunctions beyond the control of any Loan Party), and 6.12, Section 7,
Section 5 of the Borrower Stock Pledge Agreement or Section 4 of the
Security Agreement; or
67
(d) The Borrower or any other Loan Party shall default in the
observance or performance of any other agreement contained in this
Agreement or any other Loan Document (other than as provided in paragraphs
(a) through (c) of this Section), and such default shall continue
unremedied for a period of 30 days; or
(e) The Borrower or any of its Subsidiaries shall (i) default in any
payment of principal of or interest of any Indebtedness (other than the
Loans) or in the payment of any Guarantee Obligation, in each case, that is
outstanding in a principal amount of at least $1 million either
individually or in the aggregate, beyond the period of grace (not to exceed
30 days), if any, provided in the instrument or agreement under which such
Indebtedness or Guarantee Obligation was created; or (ii) default in the
observance or performance of any other agreement or condition relating to
any such Indebtedness or Guarantee Obligation or contained in any
instrument or agreement evidencing, securing or relating thereto, or any
other event shall occur or condition exist, the effect of which default or
other event or condition is to cause, or to permit the holder or holders of
such Indebtedness or beneficiary or beneficiaries of such Guarantee
Obligation (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if
required, such Indebtedness to become due prior to its stated maturity or
such Guarantee Obligation to become payable; or
(f) (i) The Borrower or any of its Subsidiaries shall commence any
case, proceeding or other action (A) under any existing or future law of
any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency,
reorganization or relief of debtors, seeking to have an order for relief
entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or
its debts, or (B) seeking appointment of a receiver, trustee, custodian,
conservator or other similar official for it or for all or any substantial
part of its assets, or the Borrower or any of its Subsidiaries shall make a
general assignment for the benefit of its creditors; or (ii) there shall be
commenced against the Borrower or any of its Subsidiaries any case,
proceeding or other action of a nature referred to in clause (i) above
which (A) results in the entry of an order for relief or any such
adjudication or appointment or (B) remains undismissed, undischarged or
unbonded for a period of 60 days; or (iii) there shall be commenced against
the Borrower or any of its Subsidiaries any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets which
results in the entry of an order for any such relief which shall not have
been vacated, discharged, or stayed or bonded pending appeal within 60 days
from the entry thereof; or (iv) the Borrower or any of its Subsidiaries
shall take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the acts set forth in clause (i),
(ii), or (iii) above; or (v) the Borrower or any of its Subsidiaries shall
generally not, or shall be unable to, or shall admit in writing its
inability to, pay its debts as they become due; or
(g) (i) Any Person shall engage in any non-exempt "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the
Code) involving any Plan, (ii) any "accumulated funding deficiency" (as
68
defined in Section 302 of ERISA), whether or not waived, shall exist with
respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise
on the assets of the Borrower or any Commonly Controlled Entity, (iii) a
Reportable Event shall occur with respect to, or proceedings shall commence
to have a trustee appointed, or a trustee shall be appointed, to administer
or to terminate, any Single Employer Plan, which Reportable Event or
commencement of proceedings or appointment of a trustee is, in the
reasonable opinion of the Majority Lenders, likely to result in the
termination of such Plan for purposes of Title IV of ERISA, (iv) any Single
Employer Plan shall terminate for purposes of Title IV of ERISA, (v) the
Borrower or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Majority Lenders is likely to, incur any liability in
connection with a withdrawal from, or the Insolvency or Reorganization of,
a Multiemployer Plan or (vi) any other event or condition shall occur or
exist with respect to a Plan; and in each case in clauses (i) through (vi)
above, such event or condition, together with all other such events or
conditions in clauses (i) through (vi), if any, could reasonably be
expected to have a Material Adverse Effect and is reasonably expected to
result in liability exceeding $1 million; or
(h) One or more judgments or decrees shall be entered against the
Borrower or any of its Subsidiaries involving in the aggregate a liability
(not paid or fully covered by insurance) of $1,000,000 or more, and all
such judgments or decrees shall not have been vacated, discharged, stayed
or bonded pending appeal within 60 days from the entry thereof or, in the
event of such a stay, such judgment shall not be discharged within 60 days
after such stay expires; or
(i) (i) Any of the Security Documents shall cease, for any reason, to
be in full force and effect, or the Borrower or any other Loan Party which
is a party to any of the Security Documents shall so assert or (ii) the
Lien created by any of the Security Documents shall cease to be enforceable
and of the same effect and priority purported to be created thereby; or
(j) The Subsidiaries Guarantee shall cease, for any reason, to be in
full force and effect or any Guarantor shall so assert; or
(k) (i) Jupiter Partners, LP ("Jupiter") shall at any time for any
reason cease to control, directly or indirectly, at least the Control
Percentage of the voting rights of the Borrower having ordinary voting
power in the election of directors of the Borrower or (ii), any other
Person or "group" (within the meaning of Section 13(d) or 14(d) of the
Securities Exchange Act of 1934, as amended) (other than Jupiter and its
Affiliates) shall have acquired control of 35% or more of the voting rights
of the Borrower having ordinary voting power in the election of directors
of the Borrower unless the acquisition by any such Person or "group" shall
have been recommended by the board of directors of the Borrower;
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) of this Section with respect to the
Borrower, automatically the Commitments shall immediately terminate and the
Loans hereunder (with accrued interest thereon) and all other amounts owing
under this Agreement (including, without limitation, all amounts of L/C
Obligations, whether or not the beneficiaries of the then outstanding Letters of
69
Credit shall have presented the documents required thereunder) shall immediately
become due and payable, and (B) if such event is any other Event of Default,
either or both of the following actions may be taken: (i) with the consent of
the Majority Lenders, the Administrative Agent may, or upon the request of the
Majority Lenders, the Administrative Agent shall, by notice to the Borrower
declare the Commitments to be terminated forthwith, whereupon the Commitments
shall immediately terminate; and (ii) with the consent of the Majority Lenders,
the Administrative Agent may, or upon the request of the Majority Lenders, the
Administrative Agent shall, by notice to the Borrower, declare the Loans
hereunder (with accrued interest thereon) and all other amounts owing under this
Agreement to be due and payable forthwith, whereupon the same shall immediately
become due and payable.
With respect to all Letters of Credit with respect to which
presentment for honor shall not have occurred at the time of an acceleration
pursuant to the preceding paragraph, the Borrower shall at such time deposit in
a cash collateral account opened by the Administrative Agent an amount equal to
the aggregate then undrawn and unexpired amount of such Letters of Credit. The
Borrower hereby grants to the Administrative Agent, for the benefit of the
Issuing Bank and the L/C Participants, a security interest in such cash
collateral to secure all obligations of the Borrower under this Agreement and
the other Loan Documents. Amounts held in such cash collateral account shall be
applied by the Administrative Agent to the payment of drafts drawn under such
Letters of Credit, and the unused portion thereof after all such Letters of
Credit shall have expired or been fully drawn upon, if any, shall be applied to
repay other obligations of the Borrower hereunder and under the Notes. After all
such Letters of Credit shall have expired or been fully drawn upon, all
Reimbursement Obligations shall have been satisfied and all other obligations of
the Borrower hereunder and under the Notes shall have been paid in full, the
Administrative Agent shall return the balance, if any, in such cash collateral
account to the Borrower and shall execute documents to terminate its security
interest in such cash collateral. The Borrower shall execute and deliver to the
Administrative Agent, for the account of the Issuing Bank and the L/C
Participants, such further documents and instruments as the Administrative Agent
may request to evidence the creation and perfection of the security interest in
such cash collateral account.
Except as expressly provided above in this Section, presentment,
demand, protest and all other notices of any kind are hereby expressly waived.
SECTION 9. THE ADMINISTRATIVE AGENT
9.1 APPOINTMENT. Each Lender hereby irrevocably designates and
appoints the Administrative Agent as the agent of such Lender under this
Agreement and the other Loan Documents, and each such Lender irrevocably
authorizes the Administrative Agent, in such capacity, to take such action on
its behalf under the provisions of this Agreement and the other Loan Documents
and to exercise such powers and perform such duties as are expressly delegated
to the Administrative Agent by the terms of this Agreement and the other Loan
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
70
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Administrative Agent.
9.2 DELEGATION OF DUTIES. The Administrative Agent may execute any
of its duties under this Agreement and the other Loan Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent
shall not be responsible for the negligence or misconduct of any administrative
agents or attorneys in-fact selected by it with reasonable care.
9.3 EXCULPATORY PROVISIONS. Neither the Administrative Agent nor any
of its officers, directors, employees, administrative agents, attorneys-in-fact
or Affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Loan Document (except for its or such Person's own gross negligence or
willful misconduct) or (ii) responsible in any manner to any of the Lenders for
any recitals, statements, representations or warranties made by the Borrower or
any officer thereof contained in this Agreement or any other Loan Document or in
any certificate, report, statement or other document referred to or provided for
in, or received by the Administrative Agent under or in connection with, this
Agreement or any other Loan Document or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of this Agreement or any other Loan
Document or for any failure of the Borrower to perform its obligations hereunder
or thereunder. The Administrative Agent shall not be under any obligation to
any Lender to ascertain or to inquire as to the observance or performance of any
of the agreements contained in, or conditions of, this Agreement or any other
Loan Document, or to inspect the properties, books or records of the Borrower.
9.4 RELIANCE BY ADMINISTRATIVE AGENT. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any Note,
writing, resolution, notice, consent, certificate, affidavit, letter, telecopy,
telex or teletype message, statement, order or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made
by the proper Person or Persons and upon advice and statements of legal counsel
(including, without limitation, counsel to the Borrower), independent
accountants and other experts selected by the Administrative Agent. The
Administrative Agent may deem and treat the payee of any Note as the owner
thereof for all purposes unless a written notice of assignment, negotiation or
transfer thereof shall have been filed with the Administrative Agent. The
Administrative Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Majority Lenders as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of taking or continuing to take any such action. The Administrative Agent shall
in all cases be fully protected in acting, or in refraining from acting, under
this Agreement and the other Loan Documents in accordance with a request of the
Majority Lenders, and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
9.5 NOTICE OF DEFAULT. The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless the Administrative Agent has received notice from a Lender or
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the Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a "notice of default". In the event
that the Administrative Agent receives such a notice, the Administrative Agent
shall give notice thereof to the Lenders. The Administrative Agent shall take
such action with respect to such Default or Event of Default as shall be
reasonably directed by the Majority Lenders; PROVIDED that unless and until the
Administrative Agent shall have received such directions, the Administrative
Agent may (but shall not be obligated to) take such action, or refrain from
taking such action, with respect to such Default or Event of Default as it shall
deem advisable in the best interests of the Lenders.
9.6 NON-RELIANCE ON ADMINISTRATIVE AGENT AND OTHER LENDERS. Each
Lender expressly acknowledges that neither the Administrative Agent nor any of
its officers, directors, employees, administrative agents, attorneys-in-fact or
Affiliates has made any representations or warranties to it and that no act by
the Administrative Agent hereinafter taken, including any review of the affairs
of the Borrower, shall be deemed to constitute any representation or warranty by
the Administrative Agent to any Lender. Each Lender represents to the
Administrative Agent that it has, independently and without reliance upon the
Administrative Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, operations, property, financial and other
condition and creditworthiness of the Borrower and made its own decision to make
its Loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Administrative Agent
or any other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this Agreement and
the other Loan Documents, and to make such investigation as it deems necessary
to inform itself as to the business, operations, property, financial and other
condition and creditworthiness of the Borrower. Except for notices, reports and
other documents expressly required to be furnished to the Lenders by the
Administrative Agent hereunder, the Administrative Agent shall not have any duty
or responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, condition (financial or
otherwise), prospects or creditworthiness of the Borrower which may come into
the possession of the Administrative Agent or any of its officers, directors,
employees, agents, attorneys-in-fact or Affiliates.
9.7 INDEMNIFICATION. The Lenders agree to indemnify the
Administrative Agent in its capacity as such (to the extent not reimbursed by
the Borrower and without limiting the obligation of the Borrower to do so),
ratably according to their respective Voting Percentages in effect on the date
on which indemnification is sought, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind whatsoever which may at any time
(including, without limitation, at any time following the payment of the Loans)
be imposed on, incurred by or asserted against the Administrative Agent in any
way relating to or arising out of, the Commitments, this Agreement, any of the
other Loan Documents or any documents contemplated by or referred to herein or
therein or the transactions contemplated hereby or thereby or any action taken
or omitted by the Administrative Agent under or in connection with any of the
foregoing; PROVIDED that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting solely from the
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Administrative Agent's gross negligence or willful misconduct. The agreements
in this subsection shall survive the payment of the Loans and all other amounts
payable hereunder.
9.8 ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. The
Administrative Agent and its Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Administrative Agent were not the Administrative Agent hereunder and under the
other Loan Documents. With respect to the Loans made by it and with respect to
any Letter of Credit issued or participated in by it, the Administrative Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Administrative Agent, and the terms "Lender" and "Lenders" shall include the
Administrative Agent in its individual capacity.
9.9 SUCCESSOR ADMINISTRATIVE AGENT. The Administrative Agent may
resign as Administrative Agent upon 10 days' notice to the Lenders. If the
Administrative Agent shall resign as Administrative Agent under this Agreement
and the other Loan Documents, then the Majority Lenders shall appoint from among
the Lenders a successor agent for the Lenders, which successor agent (provided
that it shall have been approved by the Borrower), shall succeed to the rights,
powers and duties of the Administrative Agent hereunder. Effective upon such
appointment and approval, the term "Administrative Agent" shall mean such
successor agent, and the former Administrative Agent's rights, powers and duties
as Administrative Agent shall be terminated, without any other or further act or
deed on the part of such former Administrative Agent or any of the parties to
this Agreement or any holders of the Loans. After any retiring Administrative
Agent's resignation as Administrative Agent, the provisions of this Section 8
shall inure to its benefit as to any actions taken or omitted to be taken by it
while it was Administrative Agent under this Agreement and the other Loan
Documents.
SECTION 10. MISCELLANEOUS
10.1 AMENDMENTS AND WAIVERS. Neither this Agreement nor any other
Loan Document, nor any terms hereof or thereof may be amended, supplemented,
waived or modified except in accordance with the provisions of this subsection.
The Majority Lenders may, or, with the written consent of the Majority Lenders,
the Administrative Agent may, from time to time, (a) enter into with the
Borrower written amendments, supplements or modifications hereto and to the
other Loan Documents for the purpose of adding any provisions to this Agreement
or the other Loan Documents or changing in any manner the rights of the Lenders
or of the Borrower hereunder or thereunder or (b) waive, on such terms and
conditions as the Majority Lenders or the Administrative Agent, as the case may
be, may specify in such instrument, any of the requirements of this Agreement or
the other Loan Documents or any Default or Event of Default and its
consequences; PROVIDED, HOWEVER, that no such waiver and no such amendment,
supplement or modification shall (i) reduce the amount or extend the scheduled
date of maturity of any Loan or of any installment thereof, or reduce the stated
rate of any interest or fee payable hereunder or extend the scheduled date of
any payment thereof or increase the amount or extend the expiration date of any
Lender's Commitment, in each case without the consent of each Lender affected
thereby, or (ii) amend, modify or waive any provision of this subsection or
subsection 2.16, or reduce the percentage specified in the definition of
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Majority Lenders, or consent to the assignment or transfer by the Borrower of
any of its rights and obligations under this Agreement and the other Loan
Documents or, subject to the proviso below, release the Subsidiaries Guarantee
or all or any substantial part of the Collateral, in each case without the
written consent of all the Lenders; provided, that with respect to a release of
the Subsidiaries Guarantee or all or any substantial part of the Collateral
relating solely to the obligations of the Borrower or any of its Subsidiaries in
connection with a Hedge Agreement entered into with any Lender, the written
consent of the Lender affected thereby, or (iii) increase any of the percentages
specified in the Borrowing Base, or increase the Overadvance Limit, or increase
the Uncovered L/C Amount, in each case, without the written consent of all the
Lenders, or (iv) amend, modify or waive any provision of Section 9 without the
written consent of the then Administrative Agent. Any such waiver and any such
amendment, supplement or modification shall apply equally to each of the Lenders
and shall be binding upon the Borrower, the Lenders, the Administrative Agent
and all future holders of the Loans. In the case of any waiver, the Borrower,
the Lenders and the Administrative Agent shall be restored to their former
positions and rights hereunder and under the other Loan Documents, and any
Default or Event of Default waived shall be deemed to be cured and not
continuing; no such waiver shall extend to any subsequent or other Default or
Event of Default or impair any right consequent thereon.
10.2 NOTICES. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
facsimile transmission) and, unless otherwise expressly provided herein, shall
be deemed to have been duly given or made (a) in the case of delivery by hand,
when delivered, (b) in the case of delivery by mail, three days after being
deposited in the mails, postage prepaid, or (c) in the case of delivery by
facsimile transmission, when sent and receipt has been confirmed, addressed as
follows in the case of the Borrower, the Administrative Agent and the Issuing
Banks, and as set forth on its signature page hereto in the case of the other
parties hereto, or to such other address as may be hereafter notified by the
respective parties hereto:
The Borrower: Core-Xxxx International, Inc.
000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx 000
Xxxxx Xxx Xxxxxxxxx, XX 00000
Attention: Xxx X. Xxxxxx
Fax: 000-000-0000
The Administrative
Agent: The Chase Manhattan Bank
1 Chase Xxxxxxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx Xxxxxxx
Fax: 000-000-0000
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with a copy to: Chase Agent Bank Services
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
Fax: 000-000-0000
The Issuing Bank: Chase Manhattan Bank Delaware
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxxxx
Fax: 000-000-0000
PROVIDED that any notice, request or demand to or upon the Administrative Agent
or the Lenders pursuant to subsection 2.2, 2.4, 2.6, 2.8, 2.10 or 2.15 shall not
be effective until received.
10.3 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Loan Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
10.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made hereunder, in the other Loan Documents and in any document,
certificate or statement delivered pursuant hereto or in connection herewith
shall survive the execution and delivery of this Agreement and the making of the
Loans hereunder.
10.5 PAYMENT OF EXPENSES AND TAXES. The Borrower agrees (a) to pay
or reimburse the Administrative Agent and its Affiliates for all its reasonable
out-of-pocket costs and expenses incurred in connection with the preparation,
execution, delivery and administration of, and any amendment, supplement or
modification to, this Agreement and the other Loan Documents and any other
documents prepared in connection herewith or therewith, and the consummation and
administration of the transactions contemplated hereby including, without
limitation, the fees specified in subsection 6.7 and monthly collateral
monitoring fees, including, without limitation, the reasonable fees and
disbursements of counsel to the Administrative Agent, (b) to pay or reimburse
the Administrative Agent and the Lenders for all their out-of-pocket costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the other Loan Documents and any such other
documents, including, without limitation, the reasonable fees and disbursements
of counsel to the Administrative Agent and the Lenders, (c) to pay, indemnify,
and hold the Administrative Agent and its Affiliates and the Lenders (and their
respective officers, directors, employees, advisors and agents) harmless from,
any and all recording and filing fees and any and all liabilities with respect
to, or resulting from any delay in paying, stamp, excise and other like taxes,
if any, which may be payable or determined to be payable in connection with the
execution and delivery of, or consummation or administration of any of the
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transactions contemplated by, or any amendment, supplement or modification of,
or any waiver or consent under or in respect of, this Agreement, the other Loan
Documents and any such other documents, and (d) to pay, indemnify, and hold the
Administrative Agent and its Affiliates and the Lenders (and their respective
officers, directors, employees, advisors and agents) harmless from and against
any and all other liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
whatsoever with respect to the execution, delivery, enforcement, performance and
administration of this Agreement or the other Loan Documents or of the financing
contemplated thereby or the use or the proposed use of the proceeds thereof
(other than matters the subject matter of which is covered by clauses (a), (b)
or (c) above), including, without limitation, any of the foregoing relating to
the violation of, noncompliance with or liability under, any Environmental Law
applicable to the operations of the Borrower, any of its Subsidiaries or any of
the Properties (all the foregoing in this clause (d), collectively, the
"indemnified liabilities"), PROVIDED that the Borrower shall have no obligation
hereunder to the Administrative Agent or any Lender with respect to indemnified
liabilities arising from the gross negligence or willful misconduct of the
Administrative Agent or any such Lender or arising from events or actions
occurring after any Lender has taken possession of the property at issue by
foreclosure or otherwise. The agreements in this subsection shall survive
repayment of the Loans and all other amounts payable hereunder.
10.6 SUCCESSORS AND ASSIGNS; PARTICIPATIONS AND ASSIGNMENTS. (a)
This Agreement shall be binding upon and inure to the benefit of the Borrower,
the Lenders, the Administrative Agent and their respective successors and
permitted assigns. The Borrower may not assign or transfer any of its rights or
obligations under this Agreement without the prior written consent of each
Lender.
(b) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time sell to one or more
banks or other entities ("PARTICIPANTS") participating interests in any Loan
owing to such Lender, any Commitment of such Lender or any other interest of
such Lender hereunder and under the other Loan Documents, provided that each
such sale shall be of Loans and Commitments in an aggregate amount of at least
$5,000,000 and provided further, that no Lender may so sell its Commitments so
that less than $5,000,000 of such Commitments are held by such Lender without
participating interests therein, unless such Lender so sells 100% of its
Commitments, in each case, unless otherwise agreed by the Borrower and the
Administrative Agent. In the event of any such sale by a Lender of a
participating interest to a Participant, such Lender's obligations under this
Agreement to the other parties to this Agreement shall remain unchanged, such
Lender shall remain solely responsible for the performance thereof, such Lender
shall remain the holder of any such Loan for all purposes under this Agreement
and the other Loan Documents, and the Borrower and the Administrative Agent
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement and the other Loan
Documents. No Lender shall be entitled to create in favor of any Participant,
in the participation agreement pursuant to which such Participant's
participating interest shall be created or otherwise, any right to vote on,
consent to or approve any matter relating to this Agreement or any other Loan
Document except for those specified in clauses (i) and (ii) of the proviso to
subsection 10.1. The Borrower agrees that if amounts outstanding under this
Agreement are due or unpaid, or shall have been declared or shall have become
due and payable upon the occurrence of an Event of Default, each Participant
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shall, to the maximum extent permitted by applicable law, be deemed to have the
right of setoff in respect of its participating interest in amounts owing under
this Agreement to the same extent as if the amount of its participating interest
were owing directly to it as a Lender under this Agreement, PROVIDED that, in
purchasing such participating interest, such Participant shall be deemed to have
agreed to share with the Lenders the proceeds thereof as provided in subsection
10.7(a) as fully as if it were a Lender hereunder. The Borrower also agrees
that each Participant shall be entitled to the benefits of subsections 2.18,
2.19 and 2.20 (Requirements of Law, Taxes and Indemnity) with respect to its
participation in the Commitments and the Loans outstanding from time to time as
if it was a Lender; PROVIDED that, in the case of subsection 2.19 (Taxes), such
Participant shall have complied with the requirements of said subsection and
PROVIDED, FURTHER, that no Participant shall be entitled to receive any greater
amount pursuant to any such subsection than the transferor Lender would have
been entitled to receive in respect of the amount of the participation
transferred by such transferor Lender to such Participant had no such transfer
occurred.
(c) Any Lender may, in the ordinary course of its commercial banking
business and in accordance with applicable law, at any time and from time to
time assign to any Lender or any Affiliate thereof or, with the consent of the
Borrower, the Administrative Agent and the Issuing Bank (which in each case
shall not be unreasonably withheld), to an additional bank or financial
institution (an "ASSIGNEE") all or any part of its rights and obligations under
this Agreement and the other Loan Documents pursuant to an Assignment and
Acceptance, substantially in the form of Exhibit K, executed by such Assignee,
such assigning Lender (and, in the case of an Assignee that is not then a Lender
or an affiliate thereof, by the Borrower, the Administrative Agent and the
Issuing Bank) and delivered to the Administrative Agent for its acceptance and
recording in the Register, PROVIDED that, each such sale be of Loans and
Commitments of an aggregate amount of at least $5,000,000 and provided further,
that no Lender party to this Agreement on the date hereof may so sell any of its
initial Commitments hereunder such that such Lender holds directly less than
$5,000,000 of such Commitments unless such Lender so sells 100% of its
Commitments. Upon such execution, delivery, acceptance and recording, from and
after the effective date determined pursuant to such Assignment and Acceptance,
(x) the Assignee thereunder shall be a party hereto and, to the extent PROVIDED
in such Assignment and Acceptance, have the rights and obligations of a Lender
hereunder with a Commitment as set forth therein PROVIDED that, no Assignee
shall be entitled to receive any greater amount pursuant to subsection 2.19 than
the assignor Lender would have been entitled to receive in respect of the amount
assigned by such assignor Lender to such Assignee had no such assignment
occurred, and (y) the assigning Lender thereunder shall, to the extent provided
in such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning Lender's rights and obligations under this
Agreement, such assigning Lender shall cease to be a party hereto).
Notwithstanding any provision of this paragraph (c) and paragraph (e) of this
subsection, the consent of the Borrower shall not be required, and, unless
requested by the Assignee and/or the assigning Lender, new Notes shall not be
required to be executed and delivered by the Borrower, for any assignment which
occurs at any time when any of the events described in Section 8(f) shall have
occurred and be continuing.
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(d) The Administrative Agent, on behalf of the Borrower, shall
maintain at the address of the Administrative Agent referred to in subsection
10.2 a copy of each Assignment and Acceptance delivered to it and a register
(the "REGISTER") for the recordation of the names and addresses of the Lenders
and the Commitments of, and principal amounts of the Loans owing to, each Lender
from time to time. The entries in the Register shall be conclusive, in the
absence of manifest error, and the Borrower, the Administrative Agent and the
Lenders may (and, in the case of any Loan or other obligation hereunder not
evidenced by a Note, shall) treat each Person whose name is recorded in the
Register as the owner of a Loan or other obligation hereunder as the owner
thereof for all purposes of this Agreement and the other Loan Documents,
notwithstanding any notice to the contrary. Any assignment of any Loan or other
obligation hereunder not evidenced by a Note shall be effective only upon
appropriate entries with respect thereto being made in the Register. The
Register shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an Assignee (and, in the case of an Assignee that is not
then a Lender or an affiliate thereof, by the Borrower and the Administrative
Agent) together with payment to the Administrative Agent of a registration and
processing fee of $3,500, the Administrative Agent shall (i) promptly accept
such Assignment and Acceptance and (ii) on the effective date determined
pursuant thereto record the information contained therein in the Register and
give notice of such acceptance and recordation to the Lenders and the Borrower.
(f) Subject to subsection 10.16, the Borrower authorizes each Lender
to disclose to any Participant or Assignee (each, a "TRANSFEREE") and any
prospective Transferee any and all financial information in such Lender's
possession concerning the Borrower and its Affiliates which has been delivered
to such Lender by or on behalf of the Borrower pursuant to this Agreement or
which has been delivered to such Lender by or on behalf of the Borrower in
connection with such Lender's credit evaluation of the Borrower and its
Affiliates prior to becoming a party to this Agreement.
(g) For avoidance of doubt, the parties to this Agreement acknowledge
that the provisions of this subsection concerning assignments of Loans and Notes
relate only to absolute assignments and that such provisions do not prohibit
assignments creating security interests, including, without limitation, any
pledge or assignment by a Lender of any Loan or Note to any Federal Reserve Bank
in accordance with applicable law.
10.7 ADJUSTMENTS; SET-OFF. (a) If any Lender (a "BENEFITTED
LENDER") shall at any time receive any payment of all or part of its Loans or
the Reimbursement Obligations owing to it, or interest thereon, or receive any
collateral in respect thereof (whether voluntarily or involuntarily, by set-off,
pursuant to events or proceedings of the nature referred to in Section 8(f), or
otherwise), in a greater proportion than any such payment to or collateral
received by any other Lender, if any, in respect of such other Lender's Loans or
the Reimbursements Obligations owing to it, or interest thereon, such benefitted
Lender shall purchase for cash from the other Lenders a participating interest
in such portion of each such other Lender's Loans, or the Reimbursement
Obligations owing to it, or shall provide such other Lenders with the benefits
of any such collateral, or the proceeds thereof, as shall be necessary to cause
such benefitted Lender to share the excess payment or benefits of such
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collateral or proceeds ratably with each of the Lenders; PROVIDED, HOWEVER, that
if all or any portion of such excess payment or benefits is thereafter recovered
from such benefitted Lender, such purchase shall be rescinded, and the purchase
price and benefits returned, to the extent of such recovery, but without
interest.
(b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without prior notice to the Borrower, any
such notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any amount becoming due and payable by the Borrower
hereunder (whether at the stated maturity, by acceleration or otherwise) to
set-off and appropriate and apply against such amount any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender or any branch or agency thereof to or for the
credit or the account of the Borrower. Each Lender agrees promptly to notify
the Borrower and the Administrative Agent after any such set-off and application
made by such Lender, PROVIDED that the failure to give such notice shall not
affect the validity of such set-off and application.
10.8 COUNTERPARTS. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts (including
by facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument. A set of the copies of this
Agreement signed by all the parties shall be lodged with the Borrower and the
Administrative Agent.
10.9 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
10.10 INTEGRATION. This Agreement and the other Loan Documents
represent the agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof, and there are no promises,
undertakings, representations or warranties by the Administrative Agent or any
Lender relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.
10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS
OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
10.12 SUBMISSION TO JURISDICTION; WAIVERS. The Borrower hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement and the other Loan Documents to which
it is a party, or for recognition and enforcement of any judgement in
respect thereof, to the non-exclusive general jurisdiction of the Courts of
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the State of New York sitting in the Borough of Manhattan, the courts of
the United States of America for the Southern District of New York, and
appellate courts from any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and waives any objection that it may now or hereafter have to
the venue of any such action or proceeding in any such court or that such
action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail
(or any substantially similar form of mail), postage prepaid, to the
Borrower at its address set forth in subsection 10.2 or at such other
address of which the Administrative Agent shall have been notified pursuant
thereto;
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to xxx in any other jurisdiction; and
(e) waives, to the maximum extent not prohibited by law, any right it
may have to claim or recover in any legal action or proceeding referred to
in this subsection any special, exemplary, punitive or consequential
damages.
10.13 ACKNOWLEDGEMENTS. The Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection
with this Agreement or any of the other Loan Documents, and the
relationship between Administrative Agent and Lenders, on one hand, and the
Borrower, on the other hand, in connection herewith or therewith is solely
that of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among
the Lenders or among the Borrower and the Lenders.
10.14 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
10.15 JUDGMENT CURRENCY. (a) If, for the purposes of obtaining
judgment in any court, it is necessary to convert a sum due under any of the
Loan Documents to the Administrative Agent or any Lender in any currency (the
"Original Currency") into another currency (the "Other Currency"), the parties
hereto agree, to the fullest extent that they may effectively do so, that the
rate of exchange used shall be that at which in accordance with normal banking
80
procedures the Administrative Agent or such Lender, as the case may be, could
purchase the Original Currency with the Other Currency on the Business Day
preceding that on which final judgment is paid or satisfied.
(b) The obligations of the Borrower in respect of any sum due in the
Original Currency from it to the Administrative Agent or any Lender under any of
the Loan Documents shall, notwithstanding any judgment in any Other Currency, be
discharged only to the extent that on the Business Day following receipt by the
Administrative Agent or such Lender of any sum adjudged to be so due in such
Other Currency, the Administrative Lender or such Lender, as the case may be,
may in accordance with normal banking procedures purchase the Original Currency
with such Other Currency. If the amount of the Original Currency so purchased
is less than the sum originally due to the Administrative Agent or the Lender,
as the case may be, in the Original Currency, the Borrower agrees, as a separate
obligation and notwithstanding any such judgment, to indemnify the
Administrative Agent or such Lender, as the case may be, against such loss, and
if the amount of the Original Currency so purchased exceeds the sum originally
due to the Administrative Agent or such Lender, as the case may be, in the
Original Currency, the Administrative Agent and such Lender, as the case may be,
agree to remit such excess to the Borrower.
10.16 CONFIDENTIALITY. The Administrative Agent and each Lender
agrees to keep confidential all non-public information provided to it by or on
behalf of the Borrower or any Subsidiary that is designated by the Borrower or
any Subsidiary as confidential; PROVIDED that nothing herein shall prevent the
Administrative Agent or any Lender from disclosing any such information (a) to
the Administrative Agent or any other Lender, (b) to any Transferee or
prospective Transferee which agrees to comply with the provisions of this
subsection 10.16, (c) to the employees, directors, agents, attorneys,
accountants and other professional advisors of such Lender for purposes related
to the transactions contemplated by the Loan Documents, (d) upon the request or
demand of any Governmental Authority having jurisdiction over the Administrative
Agent or such Lender, (e) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to applicable
law or regulation, (f) which has been publicly disclosed other than in breach of
this subsection 10.16, or (g) in connection with the exercise of any remedy
hereunder or under any other Loan Document.
81
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.
CORE-XXXX INTERNATIONAL, INC.
By: /s/ Xxx X. Xxxxxx
------------------------------------
Name: Xxx X. Xxxxxx
Title: Senior Vice President,
Chief Financial Officer and
Secretary
THE CHASE MANHATTAN BANK,
as Administrative Agent and as a Lender
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Attorney-In-Fact
82
THE FIRST NATIONAL BANK OF
BOSTON, as a Lender
By: /s/ Xxxxxxx Xxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
Address for Notices:
BANK OF BOSTON
000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxx
Telecopy: 000-000-0000
00
XXXXX XXXX XX XXXXXXXXXX,
N.A., as a Lender
By: /s/ Xxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Vice President
Address for Notices:
UNION BANK OF CALIFORNIA, N.A.
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Telecopy: (000) 000-0000
84
BANK OF MONTREAL, as a Lender
By: /s/ X.X. Xxxxx
------------------------------------
Name: X.X. Xxxxx
Title: Managing Director
Address for Notices:
BANK OF MONTREAL
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telecopy: 000-000-0000
85
FIRST SOURCE FINANCIAL LLP, as
a Lender by First Source
Financial, Inc., its
Agent/Manager
By: /s/ Xxxx X. Xxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxx
Title: Senior Vice President
Address for Notices:
FIRST SOURCE FINANCIAL, INC.
0000 Xxxx Xxxx Xxxx, 0xx Xxxxx
Xxxxxxx Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxxxxx
Telecopy: 000-000-0000
86
LASALLE BUSINESS CREDIT, INC.,
as a Lender
By: /s/ Xxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
Address for Notices:
LASALLE BUSINESS CREDIT, INC.
Xxx Xxxxxxxxxxxx Xxxxx, Xxxxx
000
Xxxx Xxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
Telecopy: 000-000-0000
87
SANWA BUSINESS CREDIT
CORPORATION, as a Lender
By: /s/ Xxxxxx X. Xxxxx
------------------------------------
Name: Xxxxxx X. Xxxxx
Title: First Vice President
Address for Notices:
SANWA BUSINESS CREDIT
Corporation
000 Xxxxx Xxxxx Xxxx.
Xxxxxxxx, XX 00000
Attention: Xxxxxx Sha
Telecopy: 000-000-0000
88
XXX XXXXXX AMERICAN CAPITAL
PRIME RATE INCOME TRUST, as a
Lender
By: /s/ Xxxxx X. Good
-----------------------------------
Name: XXXXX X. GOOD
Title: VICE PRESIDENT
Address for Notices:
XXX XXXXXX AMERICAN CAPITAL
PRIME RATE INCOME TRUST
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx
Telecopy: 000-000-0000
SCHEDULE 1.1(a)
CORE-XXXX INTERNATIONAL, INC.
COMMITMENT ALLOCATIONS
$210,000,000
====================================================================================================================
BANKS REVOLVING CREDIT TERM LOAN TOTAL ALLOCATION
--------------------------------------------------------------------------------------------------------------------
The Chase Manhattan Bank $86,666,666.67 $17,333,333.33 $104,000,000.00
--------------------------------------------------------------------------------------------------------------------
Xxx Xxxxxx 17,500,000.00 3,500,000.00 21,000,000.00
--------------------------------------------------------------------------------------------------------------------
Union Bank of California 12,500,000.00 2,500,000.00 15,000,000.00
--------------------------------------------------------------------------------------------------------------------
Bank of Montreal 12,500,000.00 2,500,000.00 15,000,000.00
--------------------------------------------------------------------------------------------------------------------
First Source 12,500,000.00 2,500,000.00 15,000,000.00
--------------------------------------------------------------------------------------------------------------------
LaSalle Bus. Credit 12,500,000.00 2,500,000.00 15,000,000.00
--------------------------------------------------------------------------------------------------------------------
Sanwa Bus. Credit 12,500,000.00 2,500,000.00 15,000,000.00
--------------------------------------------------------------------------------------------------------------------
Bank of Boston 8,333,333.33 1,666,666.67 10,000,000.00
--------------------------------------------------------------------------------------------------------------------
TOTALS 175,000,000.00 35,000,000.00 $210,000,000.00
====================================================================================================================
SCHEDULE 4.2
CHANGES
-none-
SCHEDULE 4.4
CONSENTS
-none-
SCHEDULE 4.6
LITIGATION
Xxxxx X. Xxxxxx v. The American Tobacco Company, et al., CV-96-05497, Second
Judicial Xxxxxxxx Xxxxx, Xxxxxx xx Xxxxxxxxxx, Xxx Xxxxxx. The complaint,
brought against the major tobacco companies and certain distributors, lists a
subsidiary of the Company as a defendant. The Company was never served. The
plaintiff has voluntarily dismissed the case without prejudice "to allow the
Plaintiffs additional time in which to realign the parties, amend the Complaint,
and possibly add additional representative plaintiffs." Both Xxxxxx Xxxxxx and
X.X. Xxxxxxxx have fully indemnified the Company and its subsidiary against all
liability and fees in connection with this litigation. Xxxxxx Xxxxxx and X.X.
Xxxxxxxx will, if the case is brought, defend the Company's subsidiary.
SCHEDULE 4.8
OWNERSHIP OF PROPERTY; LIENS
-none-
SCHEDULE 4.9
INTELLECTUAL PROPERTY
-none-
SCHEDULE 4.11
TAXES
(page 1)
Tax Filings
All Federal and State income tax extensions for fiscal year ended 12/31/95 have
been filed as customary and in the ordinar course of business.
Tax Liens
See attached schedule
SCHEDULE 4.11
TAXES
(page 2)
TAX LIENS ONLY
UCC-1 AND UCC-2/UCC-3 FINANCING STATEMENTS AGAINST THE DEBTORS NAMED BELOW
------------------------------------------------------------------------------------------------------------------------------------
[ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE
[ILLEGIBLE CAPTION] CAPTION] CAPTION] CAPTION] CAPTION] CAPTION] CAPTION] [ILLEGIBLE CAPTION]
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Distributors Inc. CA Alameda 7/2/90 Secured State Tax Lien for
3130 Leanis Bl. County 90-180344 Property fiscal year 1986/87
Xxx Xxxxxxx, XX 00000 Taxes for $411.30
------------------------------------------------------------------------------------------------------------------------------------
Page 1 of 1
SCHEDULE 4.13
ERISA
Present Value of Accrued Benefits
The Core-xxxx International, Inc. Non-Bargaining Employees Pension Plan as per
the 1/1/95 actuarial valuation had a market value of assets of $10,892,840 and a
total current liability of $14,150,842.
Withdrawals
Core-Xxxx International, Inc. withdrew from the following plans:
Plan Name: Western Conference of Teamsters Pension Plan #204130
Effective: June 30, 1986
Division: Hayward
Reason: Bargaining unit of sales representatives represented by Teamsters
Union Local 588 voted to decertify the union on May 17, 1996. Those
election results were subsequently certified by the National Labor
Relations Board on May 29, 1996.
Plan Name: Western Conference of Teamsters Pention Plan #310641
Effective: July 1, 1996
Division: Las Vegas
Reason: Contract Negotiations; employees now covered by a new collective
bargaining agreement effective March 31, 1996 through March 31,
1999.
Plan Name: Western Conference of Teamsters Pension Plan #204128
Effective: December 31, 1992
Division: Carpenteria
Reason: Cessation of operations effective December 31, 1992
Withdrawal Liability
Per a letter dated July 1, 1996 from the Western Conference of Teamsters Pension
Trust: the employer has no withdrawal liability for a complete or partial
withdrawal from the Western Conference of Teamsters Pension Plan ("the Plan")
occurring in plan year 1995; the Plan has no unfunded, vested benefit liability
for plan years December 31, 1988 - 1994; and this trend is expected to continue,
but the Trustees for the Plan reserve the right to determine future withdrawal
liability based upon actual plan experience.
Two of the above plans (#204130 and #310641) are subject to audits which could
result in assessments on past contributions. Per a letter dated February 29,
1996, the Western Conference of Teamsters Pension Trust concluded their audit of
the third plan, #204128, and the assessment has been paid.
SCHEDULE 4.15
SUBSIDIARIES
Name of State of Date of Shares Shares Percentage
Subsidiary Incorporation Incorporation Authorized Outstanding Outstanding
---------- ------------- ------------- ---------- ----------- -----------
C/M Products, Inc. California 7/19/89 1,000 100 10%
Sole Shareholder:
Core-Xxxx International, Inc.
Core-Xxxx Interrelated
Companies, Inc. California 4/14/75 1,000,000 1,000,000 100%
Core-Xxxx Midcontinent, Inc. Arkansas 7/2/81 2,000 2,000 100%
SCHEDULE 4.17
ENVIRONMENTAL MATTERS
The company has five underground storage tanks (UST) located at the following
properties
Location Number of USTs
-------- --------------
1. 000 Xxxxx Xxxxxx 0
Xxxxxx, XX 00000
2. 0000 Xxxx Xxxxxx 0
Xxxxxxxxxx, XX 00000
3. 0000 X. 00xx Xxxxxx 0
Xxxxxx, XX 00000
4. 00000 Xxxxxxxxxx Xxxx 0
Xxxxxxxx, XX, X0X 0X0, Xxxxxx
SCHEDULE 4.19(b)
SECURITY DOCUMENTS; OFFICES
Financing Statements
Debtor Filing Jurisdiction
Core-Xxxx International, Inc. Arizona - Secretary of State
Core-Xxxx Midcontinent, Inc. California - Secretary of State
Core-Xxxx Interrelated Companies, Inc. Colorado - Secretary of State
Core-Xxxx Distributors, Inc. Nevada - Secretary of State
C/M Products, Inc. New Mexico - Secretary of State
Oregon - Secretary of State
Utah - Secretary of Xxxxx
Xxxxxxxxxx - Xxxxxxxxx xx Xxxxx
Xxxxxx - Xxxxxxx Provincial Registrar
General
Canada - British Columbia Provincial
Registrar General
Canada - Manitoba Personal Property
Registry
SCHEDULE 7.2
INDEBTEDNESS
Letters of Credit
ISSUER BENEFICIARY AMOUNT
------ ----------- ------
BANK OF ITWAL C$400,000
MONTREAL 2725321 CANADA, INC. C$100,000
---------
C$500,000
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Xerox Corporation CA Secretary 7/18/91 Xerox Duplicating System
31300 Medallion Drive of 91155677
Xxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International Xerox Corporation CA Secretary 3/10/92 Xerox Duplicating System
31300 Medallion Drive of 92044057
Xxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Yale Industrial Trucks, Inc. CA Secretary 8/06/92 Yale Motorized Hand Truck
3130 South 1030 West Assigned to: of 92172268
Xxxx Xxxx Xxxx, XX 00000 Yale Financial Services, Inc. State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Crown Credit Company CA Secretary 11/3/92 Crown Lift Truck & Batteries
0000 X. 00xx Xxxxxx of 92237404
Xxx Xxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Xxxx Atlantic TriCon Leasing CA Secretary 4/15/93 Sharp Equipment
000 Xxxxxx Xxxxxx xx 00000000
Xxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Security Leasing Services, Inc. CA Secretary 8/2/93 Alarm System
0000 X. 00xx Xxxxxx Assigned to: of 93155811
Xxx Xxxxxxx, XX 00000 AVCO Leasing Services, Inc. State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Xxxxxxx Company CA Secretary 9/20/93 Power Scrubber
000 Xxxxxx Xxxxxx xx 00000000
Xxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Page 1 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Xerox Corporation CA Secretary 10/8/93 Xerox Copier
0000 X. 00xx Xxxxxx of 93205557
Xxx Xxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core Xxxx International Pitney Xxxxx Credit Corp. CA Secretary 4/25/96 All Equipment from Pitney
31300 Medallion Drive of 9611760204 Xxxxx subject to
Xxxxxxx, XX 00000 State lease dated 3/29/96.
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International Norwest Financial Leasing. CA Secretary 5/9/96 Radionic Control
0000 X. 00xx Xxxxxx Inc. of 9613160876 Equipment
Xxx Xxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Yale Industrial Trucks, Inc. UT Secretary 8/5/92 Yale Motorized Hand Truck
3130 South 0000 Xxxx xx 000000
Xxxx Xxxx Xxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Orix Credit Alliance, Inc. UT Secretary 3/2/93 Voice Mail Unit
3130 S. 0000 X xx 000000
Xxxx Xxxx Xxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Xxxxxxx Company UT Secretary ? Power Scrubber
3130 S. 000 X xx 00-000000
Xxxx Xxxx Xxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Interrelated General Electric Company CA Secretary 5/17/91 Inventory-Lamps and
Companies, Inc. of 91109021 Light Bulbs
0000 Xxxxx Xxxxxxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
------------------------------------------------------------------------------------------------------------------------------------
Page 2 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx Midcontinent, Inc. NCR Credit Corp CA Secretary 8/3/95 AT&T Equipment & All
000 Xxxxxx Xxxxx Xxxx., Xxxxx 000 of 9521960399 Attachments
Xxxxx Xxx Xxxxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Midcontinent, Inc. First Security Leasing Company NM Secretary 4/24/95 Stationary Compactor
000 Xxxxxx Xxxxx Xxxx., Xxxxx 000 of 950424067
Xxxxx Xxx Xxxxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Distributors, Inc. Yale Financial Services Trust CA Secretary 2/18/87 Fork Lift Trucks &
0000 X. Xxxx Xx. Assigned to: of 87041979 All Accessories
Xxx Xxxxxxx, XX 00000 Xxxxxx Financial, Inc. State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Distributors, Inc. PacifiCorp Capital, Inc. CA Secretary 11/5/91 AT&T Equipment
000 Xxxxxx Xxxxx Xxxx., Xxxxx 000 of 91237851
Xxxxx Xxx Xxxxxxxxx, XX 00000 State
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Distributors, Inc. Norlift of Oregon, Inc. OR Secretary 1/6/93 Forklift
XX Xxx 00 xx X00000 (old)
Xxxxxxxxx, XX 00000 State 162206 (new)
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx Distributors, Inc. Xxxxxxx Machinery Company UT Secretary 12/17/91 Equipment
643 West 3560 South Assigned to: of 307812
Xxxx Xxxx Xxxx, XX 00000 Xxxxxxx Leasing Corp. State
------------------------------------------------------------------------------------------------------------------------------------
Page 3 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Xerox Canada, Ltd. Alberta Personal 4/1/93 Xerox Copier
Property 93040108453
Registry
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Telecom Leasing Canada Alberta Personal 09/29/93 Telephone Equipment
(TLC) Limited Property 93092907018
Registry
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Xerox Canada, Ltd. Alberta Personal 12/20/94 Xerox Equipment
Property 94122006342
Registry
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Transport International Pool Alberta Personal 08/22/95 3 Trailers
Property 95082213869
Registry
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. AT&T Capital Canada Alberta Personal 06/24/96 Riso Model 6300 &
Property 96062420730 accessories
Registry
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. X.X. Xxxxxxxx Equipment Co. BC Ministry of 02/28/92 Battery & Charger
0000 Xxxxxxx Xx. LTD Finance & 3874008
Victoria, BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Telecom Leasing Canada BC Ministry of 06/25/92 Telephone Equipment
00000 Xxxx Xxxxx, Xxx 000 (TLC) Limited Finance & 4071096
Richmond BC Corporate 05/17/95
Relations 5788967
05/17/95
5789636
------------------------------------------------------------------------------------------------------------------------------------
Page 4 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Telecom Leasing Canada BC Ministry of 06/25/92 Telephone Equipment
0000 Xxxxxxx Xx. (TLC) Limited Finance & 4071146
Victoria, BC Corporate 05/17/95
Relations 5788968
05/17/95
5789655
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. IBM Canada Ltd. BC Ministry of 12/23/92 Office Equipment /
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 4374735 Computers supplied by
Richmond BC Corporate 01/14/93 Secured Party
Relations 4403182
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Comdisco Canada Ltd. BC Ministry of 02/15/93 IBM equipment under
00000 Xxxx Xxxxx, Xxx 000 Finance & 4457490 master lease
Richmond BC Corporate 03/03/95 dated 1/13/93
Relations 5669001
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 03/09/93 Equipment per terms
00000 Xxxx Xxxxx, Xxx 000 Finance & 4492529 517 dated 3/3/93
Richmond BC Corporate 08/20/93
Relations name change
03/04/96
address change
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 08/12/93 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 4761308
Richmond BC Corporate 08/20/93
Relations name change
03/04/96
address change
------------------------------------------------------------------------------------------------------------------------------------
Page 5 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Rentway Inc. BC Ministry of 09/27/93 1994 Ford
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 4839192
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Barclays Bank of Canada BC Ministry of 12/03/93 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 4956110
Richmond BC Corporate 03/09/95
Relations 5678507
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services, Ltd. BC Ministry of 01/05/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5001568
Richmond BC Corporate 03/04/96
Relations address change
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 03/07/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5096864
Richmond BC Corporate 03/04/96
Relations address change
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Rentway Inc. BC Ministry of 04/13/94 1994 Freightliner
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5158292
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Canadian Western Bank BC Ministry of 04/14/94 Coldstream Coolers &
0000 Xxxxxxx Xx. Leasing Inc. Finance & 5160635 Accessories
Victoria, BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Page 6 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Barclays Bank of Canada BC Ministry of 08/16/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5364783
Richmond BC Corporate 03/04/96
Relations address change
03/09/95
5678508
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Barclays Bank of Canada BC Ministry of 10/26/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5479148
Richmond BC Corporate 03/04/96
Relations address change
03/09/95
5678509
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services, Ltd. BC Ministry of 12/21/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5568305
Richmond BC Corporate 03/04/96
Relations address change
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 12/21/94 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5568304
Richmond BC Corporate 03/04/96
Relations address change
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 02/06/95 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Finance & 5629923
Richmond BC Corporate 03/04/96
Relations address change
------------------------------------------------------------------------------------------------------------------------------------
Page 7 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Inland Kenworth BC Ministry of 04/28/95 Kenworth T300
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5753001
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Paccar of Canada, Ltd. BC Ministry of 07/05/95 2 - 1994 Kenworth T400
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5866771
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Ensign Pacific Lease Ltd. BC Ministry of 07/07/95 1995 Ford Taurus
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5871444
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Inland Kenworth BC Ministry of 07/13/95 2 Kenworth T400
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5881647
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Inland Kenworth BC Ministry of 08/04/95 Kenworth T800B
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5916963
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Inland Kenworth BC Ministry of 08/16/95 Kenworth T300
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5932783
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Page 8 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Paccar of Canada, Ltd. BC Ministry of 10/23/95 1996 Kenworth 7800
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 6046467
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Paccar of Canada, Ltd. BC Ministry of 10/23/95 1995 Kenworth T300
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 6046469
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Paccar of Canada, Ltd. BC Ministry of 07/11/95 1995 Kenworth
00000 Xxxxxx Xxxxx, Xxx 000 Finance & 5876306
Richmond BC Corporate 11/21/95
Relations 6100865
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. MFP Technology Services Ltd. BC Ministry of 12/20/95 Computer Equipment
00000 Xxxx Xxxxx, Xxx 000 Xxxxxxx & 000000
Xxxxxxxx XX Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Per. M. Enterprises Ltd DBA BC Ministry of 04/02/96 1989 Trailmobile
00000 Xxxxxx Xxxxx, Xxx 000 Annacis Truck & Trailer Service Finance & 6307632
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Per. M. Enterprises Ltd DBA BC Ministry of 04/02/96 1989 Van
00000 Xxxxxx Xxxxx, Xxx 000 Annacis Truck & Trailer Service Finance & 6307650
Richmond BC Corporate
Relations
------------------------------------------------------------------------------------------------------------------------------------
Page 9 of 10
SCHEDULE 7.3
LIENS
====================================================================================================================================
[ILLEGIBLE CAPTION] [ILLEGIBLE CAPTION] [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE [ILLEGIBLE CAPTION]
CAPTION] CAPTION] CAPTION]
====================================================================================================================================
Core-Xxxx International, Inc. Paccar of Canada, Ltd. Winnipeg 950106- Motor Vehicles
Manitoba 104393
------------------------------------------------------------------------------------------------------------------------------------
Core-Xxxx International, Inc. Paccar of Canada, Ltd. Winnipeg 951100- 1996 Kenworth
Manitoba 101972
------------------------------------------------------------------------------------------------------------------------------------
Core-xxxx Distributors, Inc. CCL Leasing - Calgary Alberta Personal 07/27/93 Canon Copier
Copier Ltd. Property 93072722346
Manager
------------------------------------------------------------------------------------------------------------------------------------
Page 10 of 10
SCHEDULE 7.4
GUARANTEE OBLIGATIONS
-none-
EXHIBIT A TO
CREDIT AGREEMENT
----------------
[FORM OF]
REVOLVING CREDIT NOTE
$ _______ New York, New York
August 7, 1996
FOR VALUE RECEIVED, the undersigned, CORE-XXXX INTERNATIONAL, INC., a
Delaware corporation (the "BORROWER"), hereby unconditionally promises to pay
to the order of _______ (the "LENDER") at the office of The Chase Manhattan
Bank, located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, in lawful money
of the United States of America and in immediately available funds, on the
Termination Date the principal amount of (a)_______ DOLLARS ($_______), or,
if less, (b) the aggregate unpaid principal amount of all Revolving Credit
Loans made by the Lender to the Borrower pursuant to subsection 2.1 of the
Credit Agreement, as hereinafter defined. The Borrower further agrees to pay
interest in like money at such office on the unpaid principal amount hereof
from time to time outstanding at the rates and on the dates specified in
subsections 2.11 and 2.13 of such Credit Agreement.
The holder of this Note is authorized to endorse on the schedules
annexed hereto and made a part hereof or on a continuation thereof which
shall be attached hereto and made a part hereof the date, Type and amount of
each Revolving Credit Loan made pursuant to the Credit Agreement and the date
and amount of each payment or prepayment of principal thereof, each
continuation thereof, each conversion of all or a portion thereof to another
Type and, in the case of Eurodollar Loans, the length of each Interest Period
with respect thereto. Each such endorsement, absent manifest error, shall
constitute PRIMA FACIE evidence of the accuracy of the information endorsed.
The failure to make any such endorsement or any error in such endorsement
shall not affect the obligations of the Borrower in respect of such Revolving
Credit Loan.
This Note (a) is one of the Revolving Credit Notes referred to in the
Credit Agreement dated as of August 7, 1996 (as amended, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"), among the
Borrower, the Lender, the other banks and financial institutions from time to
time parties thereto and The Chase Manhattan Bank, as administrative agent,
(b) is subject to the provisions of the Credit Agreement and (c) is subject
to optional and mandatory prepayment in whole or in part as provided in the
Credit Agreement. This Note is secured and guaranteed as provided in the
Loan Documents. Reference is hereby made to the Loan Documents for a
description of the properties and assets in which a security interest has
been granted, the nature and extent of the security and the guarantees, the
terms and conditions upon which the security interests and each guarantee
were granted and the rights of the holder of this Note in respect thereof.
2
Upon the occurrence of any one or more of the Events of Default, all
amounts then remaining unpaid on this Note shall become, or may be declared
to be, immediately due and payable, all as provided in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether
as maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind in connection
with this Note.
Unless otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
CORE-XXXX INTERNATIONAL, INC.
By:
-----------------------------------
Name:
Title:
Schedule A
to Revolving Credit Note
------------------------
LOANS, CONVERSIONS AND REPAYMENTS OF ABR LOANS
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Amount Amount of ABR Loans
Amount of Converted to Amount of Principal of Converted to Unpaid Principal Balance
Date ABR Loans ABR Loans ABR Loans Repaid Eurodollar Loans of ABR Loans Notation Made By
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Schedule B
to Revolving Credit Note
-------------------------
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS
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Amount of Amount Interest Period Amount of Principal Amount of Eurodollar Unpaid Principal
Eurodollar Converted to and Eurodollar Rate of Eurodollar Loans Converted to Balance of Notation
Date Loans Eurodollar Loans with Respect Thereto Loans Repaid ABR Loans Eurodollar Loans Made By
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EXHIBIT B TO
CREDIT AGREEMENT
----------------
[FORM OF]
TERM NOTE
$________ New York, New York
August 7, 1996
FOR VALUE RECEIVED, the undersigned, CORE-XXXX INTERNATIONAL, INC., a
Delaware corporation (the "BORROWER"), hereby unconditionally promises to pay
to the order of ___________________ (the "LENDER") at the office of The Chase
Manhattan Bank, located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, in lawful
money of the United States of America and in immediately available funds, the
principal amount of ________________________ DOLLARS ($_________), or, if less,
the unpaid principal amount of the Term Loan made by the Lender pursuant to
subsection 2.5 of the Credit Agreement, as hereinafter defined. The principal
amount shall be paid in the amounts and on the dates specified in subsection
2.7. The Borrower further agrees to pay interest in like money at such office
on the unpaid principal amount hereof from time to time outstanding at the rates
and on the dates specified in subsections 2.11 and 2.13 of such Credit
Agreement.
The holder of this Note is authorized to endorse on the schedules annexed
hereto and made a part hereof or on a continuation thereof which shall be
attached hereto and made a part hereof the date, Type and amount of the Term
Loan and the date and amount of each payment or prepayment of principal with
respect thereto, each conversion of all or a portion thereof to another Type,
each continuation of all or a portion thereof as the same Type and, in the case
of Eurodollar Loans, the length of each Interest Period with respect thereto.
Each such endorsement, absent manifest error, shall constitute PRIMA FACIE
evidence of the accuracy of the information endorsed. The failure to make any
such endorsement or any error in such endorsement shall not affect the
obligations of the Borrower in respect of such Term Loan.
This Note (a) is one of the Term Notes referred to in the Credit Agreement
dated as of August 7, 1996 (as amended, supplemented or otherwise modified from
time to time, the "CREDIT AGREEMENT"), among the Borrower, the Lender, the other
banks and financial institutions from time to time parties thereto and The Chase
Manhattan Bank, as administrative agent, (b) is subject to the provisions of the
Credit Agreement and (c) is subject to optional and mandatory prepayment in
whole or in part as provided in the Credit Agreement. This Note is secured and
guaranteed as provided in the Loan Documents. Reference is hereby made to the
Loan Documents for a description of the properties and assets in which a
security interest has been granted, the nature and extent of the security and
the guarantees, the terms and conditions upon which the security interests and
each guarantee were granted and the rights of the holder of this Note in respect
thereof.
2
Upon the occurrence of any one or more of the Events of Default, all
amounts then remaining unpaid on this Note shall become, or may be declared to
be, immediately due and payable, all as provided in the Credit Agreement.
All parties now and hereafter liable with respect to this Note, whether as
maker, principal, surety, guarantor, endorser or otherwise, hereby waive
presentment, demand, protest and all other notices of any kind in connection
with this Note.
Unless otherwise defined herein, terms defined in the Credit Agreement and
used herein shall have the meanings given to them in the Credit Agreement.
THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE
WITH, THE LAW OF THE STATE OF NEW YORK.
CORE-XXXX INTERNATIONAL, INC.
By:__________________________
Name:
Title:
Schedule A
to Term Loan Note
-----------------
LOANS, CONVERSIONS AND REPAYMENTS OF ABR LOANS
AMOUNT AMOUNT OF ABR LOANS
CONVERTED TO AMOUNT OF PRINCIPAL OF CONVERTED TO UNPAID PRINCIPAL BALANCE
DATE AMOUNT OF ABR LOANS ABR LOANS ABR LOANS REPAID EURODOLLAR LOANS OF ABR LOANS NOTATIONS MADE BY
---------- ------------------- -------------- ---------------------- ------------------- ------------------------ -----------------
Schedule B
to Term Loan Note
-----------------
LOANS, CONTINUATIONS, CONVERSIONS AND REPAYMENTS OF EURODOLLAR LOANS
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AMOUNT INTEREST PERIOD AND AMOUNT OF PRINCIPAL AMOUNT OF EURODOLLAR UNPAID PRINCIPAL
AMOUNT OF CONVERTED TO EURODOLLAR RATE WITH OF EURODOLLAR LOANS CONVERTED BALANCE OF NOTATION
DATE EURODOLLAR LOANS EURODOLLAR LOANS RESPECT THERETO LOANS REPAID TO ABR LOANS EURODOLLAR LOANS MADE BY
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EXHIBIT C
TO CREDIT AGREEMENT
SECURITY AGREEMENT
among
CORE-XXXX INTERNATIONAL, INC.,
C/M PRODUCTS, INC.,
CORE-XXXX INTERRELATED COMPANIES, INC.
and
CORE-XXXX MIDCONTINENT, INC.
in favor of
THE CHASE MANHATTAN BANK,
as Administrative Agent
August 7, 1996
TABLE OF CONTENTS
1. Defined Terms.............................................................1
1.1 Definitions..........................................................1
1.2 Other Definitional Provisions........................................5
2. Grant of Security Interest................................................6
3. Representations and Warranties............................................7
3.1 Title; No Other Liens................................................7
3.2 Perfected First Priority Liens.......................................7
3.3 Inventory and Equipment..............................................7
3.4 Chief Executive Office...............................................7
3.5 Farm Products........................................................7
4. Covenants.................................................................7
4.1 Delivery of Instruments and Chattel Paper............................7
4.2 Maintenance of Insurance.............................................8
4.3 Maintenance of Perfected Security Interest; Further Documentation....8
4.5 Further Identification of Collateral.................................9
4.6 Notices..............................................................9
5. Provisions Relating to Accounts...........................................9
5.1 Grantors Remain Liable under Accounts................................9
5.2 Analysis of Accounts................................................10
5.3 Collections on Accounts.............................................10
5.4 Maintaining the US Cash Collateral Account and the L/C Cash
Collateral Account..................................................10
5.5 Maintaining the Depository Accounts, the Deposit Accounts,
the Canadian Cash Collateral Account and the Collection Accounts....11
5.6 Investing of Amounts in the US Cash Collateral Account and
the L/C Cash Collateral Account.....................................12
5.7 Application and Release of Funds....................................12
5.8 Representations and Warranties......................................13
5.9 Covenants...........................................................13
6. Provisions Relating to Contracts.........................................14
6.1 Borrower Remains Liable under Contracts.............................14
6.2 Communication With Contracting Parties..............................14
6.3 Representations and Warranties......................................14
6.4 Covenants...........................................................15
7. Provisions Relating to Copyrights, Patents and Trademarks................15
7.1 Representations and Warranties......................................15
7.2 Covenants...........................................................16
8. Remedies.................................................................17
i
8.1 Notice to Obligors and Contract Parties............................17
8.2 Proceeds to be Turned Over To Administrative Agent.................18
8.3 Code Remedies......................................................18
9. Administrative Agent's Appointment as Attorney-in-Fact;
Administrative Agent's Performance of Borrower's Obligations............19
9.1 Powers.............................................................19
9.2 Performance by Administrative Agent of Borrower's Obligations......20
9.3 Borrower's Reimbursement Obligation................................20
9.4 Ratification; Power Coupled With An Interest.......................20
10. Duty of Administrative Agent............................................21
11. Execution of Financing Statements.......................................21
12. Authority of Administrative Agent.......................................21
13. Notices.................................................................21
14. Severability............................................................22
15. Amendments in Writing; No Waiver; Cumulative Remedies...................22
15.1 Amendments in Writing.............................................22
15.2 No Waiver by Course of Conduct....................................22
15.3 Remedies Cumulative...............................................22
16. Section Headings........................................................22
17. Successors and Assigns..................................................22
18. Attachment..............................................................22
19. Governing Law...........................................................23
20 Termination and Release of Collateral....................................23
21. WAIVERS OF JURY TRIAL...................................................23
ii
[FORM OF]
SECURITY AGREEMENT
SECURITY AGREEMENT, dated as of August 7, 1996, made by each of the
signatories hereto (the "Grantors"), in favor of THE CHASE MANHATTAN BANK, a
New York banking corporation, as administrative agent (in such capacity, the
"Administrative Agent") for the Lenders parties to the Credit Agreement,
dated as of August 7, 1996 (as amended, supplemented or otherwise modified
from time to time, the "Credit Agreement"), among Core-Xxxx International,
Inc., a Delaware corporation (the "Borrower"), the Administrative Agent and
such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have
severally agreed to make Loans to and issue or participate in Letters of
Credit for the account of, the Borrower upon the terms and subject to the
conditions set forth therein; and
WHEREAS, it is a condition precedent to the obligation of the
Lenders to make their respective Loans and other extensions of credit to the
Borrower under the Credit Agreement that the Grantors shall have executed and
delivered this Security Agreement to the Administrative Agent for the ratable
benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and
to induce the Lenders to make their respective Loans and other extensions of
credit to the Borrower, each Grantor hereby agrees with the Administrative
Agent, for the ratable benefit of the Lenders, as follows:
1. DEFINED TERMS.
1.1 Definitions. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them
in the Credit Agreement, and the following terms which are defined in the
Uniform Commercial Code in effect in the State of New York on the date hereof
are used herein as so defined: Accounts, Chattel Paper, Documents,
Equipment, Farm Products, General Intangibles, Instruments, Inventory and
Proceeds.
(b) The following terms shall have the following meanings:
"ACCOUNT COLLATERAL": (a) all funds held in and all certificates and
instruments, if any, from time to time representing or evidencing (1) the
Cash Collateral Accounts, (2) the L/C Cash Collateral Account, (3) the
Collection Accounts, (4) the Depository Accounts, (5) the Deposit Accounts,
(6) all other deposit accounts of each Grantor and
2
(7) all Collateral Investments and (b)(1) all notes, certificates of deposit,
deposit accounts, checks and other instruments from time to time hereinafter
delivered to or otherwise possessed by the Administrative Agent for or on
behalf of each Grantor in substitution for or in addition to any or all of
the then existing Account Collateral and (2) all interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of the then
existing Account Collateral.
"AGREEMENT": this Security Agreement, as the same may be amended,
supplemented or otherwise modified from time to time.
"ALLOCATION PERCENTAGE": (a) with respect to the Term Loans, a fraction
the numerator of which is the outstanding Term Loans, and the denominator of
which is the sum of the outstanding Term Loans, the outstanding Revolving
Credit Loans and the outstanding L/C Obligations and (b) with respect to the
Aggregate Outstanding Revolving Extensions of Credit, 1 minus the allocation
percentage applicable to the Term Loans as set forth above.
"BORROWING CERTIFICATE": a certificate substantially in the form of
Exhibit G to the Credit Agreement.
"CODE": the Uniform Commercial Code as from time to time in effect in
the State of New York.
"CANADIAN CASH COLLATERAL ACCOUNT": a cash collateral account with Bank
of Montreal or such other bank as may be reasonably acceptable to the
Administrative Agent, in the name of the Borrower that has entered into a
letter agreement substantially in the form of Exhibit A-2-A.
"CASH COLLATERAL ACCOUNTS": the Canadian Cash Collateral Account and the
US Cash Collateral Account.
"COLLATERAL": as defined in Section 2.
"COLLATERAL INVESTMENTS": as defined in subsection 5.6.
"COLLECTION ACCOUNT BANK": as defined in subsection 5.5(b).
"COLLECTION ACCOUNTS": each non-interest bearing cash collection account
with a bank that is reasonably satisfactory to the Administrative Agent and
that has entered into a Collection Account Letter, initially, account number
000-000-000, with Xxxxx Fargo Bank (formerly First Interstate Bank) at its
office at 000 Xxxxxxxx Xxxx., Xxx Xxxxxxx, XX 00000, account number
4518-099999, with Xxxxx Fargo Bank at its office at 000 Xxxxxxxxxx Xxxxxx,
Xxx Xxxxxxxxx, XX 00000 and account number
3
0109656314, with Sunwest Bank at its office at 000 Xxxx X.X., Xxxxxxxxxxx,
Xxx Xxxxxx 00000.
"COLLECTION ACCOUNT LETTER": as defined in subsection 5.5(b).
"CONTRACTS": with respect to any Accounts, Instruments, Chattel Paper or
General Intangibles, any contract or agreement in respect thereof or pursuant
to which any of the foregoing was created, as the same may be amended,
supplemented or otherwise modified from time to time, including, without
limitation, (a) all rights of each Grantor to receive moneys due and to
become due to it thereunder or in connection therewith, (b) all rights of
each Grantor to damages arising out of or for breach or default in respect
thereof and (c) all rights of each Grantor to exercise all remedies
thereunder.
"COPYRIGHTS": all copyrights, whether registered or unregistered, and
whether or not the underlying works of authorship have been published, and
all works of authorship and other rights therein or derived therefrom, all
copyrights of works based on, incorporated in, derived from or relating to
works covered by such copyrights, all right, title and interest to make and
exploit all derivative works based upon or adopted from works covered by such
copyright and all copyright registrations and copyright applications, and any
renewals or extensions thereof, including without limitation, each copyright
registration and copyright application, if any, identified in SCHEDULE 1
hereto, and including, without limitation, (a) the right to print, publish
and distribute any of the foregoing, (b) the right to xxx or otherwise
recover for any and all past, present and future infringements and
misappropriations thereof, (c) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto
(including, without limitation, payments under all licenses entered into in
connection therewith, and damages and payments for past or future
infringements thereof) and (d) all rights of each Grantor corresponding
thereto throughout the United States and all other rights of any kind
whatsoever of each Grantor accruing thereunder or pertaining thereto;
provided that, for purposes hereof, the term "Copyrights" shall not include
those rights which are not created by, or do not arise or exist under, the
laws of the United States or any State or political subdivision thereof.
"COPYRIGHT LICENSES": all license agreements with any other Person in
connection with any of the Copyrights of each Grantor, or such other Person's
copyrights, whether each Grantor is a licensor or licensee under any such
license agreement, including, without limitation, the license agreements
listed on SCHEDULE 1 hereto, subject in each case to the terms of such
license agreements, including, without limitation, terms requiring consent to
a grant of a security interest; PROVIDED that, for purposes hereof, the term
"Copyright Licenses" shall not include those rights which are not created by,
or do not arise or exist under, the laws of the United States or any State or
political subdivision thereof.
4
"DEPOSIT ACCOUNTS": as defined in subsection 5.5(a).
"DEPOSIT BANKS": as defined in subsection 5.5(a).
"DEPOSIT ACCOUNT LETTERS": as defined in subsection 5.5(a).
"DEPOSITORY ACCOUNTS": as defined in subsection 5.5(a).
"DEPOSITORY BANKS": as defined in subsection 5.5(a).
"DEPOSITORY LETTERS": as defined in subsection 5.5(a).
"L/C CASH COLLATERAL ACCOUNT": a non-interest bearing cash collateral
account with The Chase Manhattan Bank at its office at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx, 00000, account number 000-0-000000, in the name of the
Administrative Agent and under its sole dominion and control and subject to
the terms of this Agreement.
"OBLIGATIONS": the collective reference to the unpaid principal of and
interest on the Loans and all other obligations and liabilities of each
Grantor to the Administrative Agent and the Lenders (including, without
limitation, interest accruing at the then applicable rate provided in the
Credit Agreement after the maturity of the Loans and interest accruing at the
then applicable rate provided in the Credit Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization
or like proceeding, relating to each Grantor, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in
connection with, the Credit Agreement, this Agreement, the other Loan
Documents, any Hedge Agreement entered into by any Grantor with any Lender,
any Overdraft or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of counsel to the
Administrative Agent or to the Lenders that are required to be paid by each
Grantor pursuant to the terms of the Credit Agreement, this Agreement, any
other Loan Document, any Hedge Agreement entered into by any Grantor with any
Lender or any Overdraft), PROVIDED that in no event shall the obligations of
any Grantor other than the Borrower exceed the maximum amount specified in
the Subsidiaries Guarantee.
"OVERDRAFT": means, at any time, the amount by which the aggregate
amount debited from any deposit, concentration, operating or disbursement
account maintained by any Grantor with the Administrative Agent or any
Affiliate of the Administrative Agent, as the result of processing of payment
orders issued by such Grantor or otherwise, exceeds the aggregate funds on
deposit in such account.
5
"PATENTS": (a) all letters patent of the United States or any other
country and all reissues and extensions thereof, including, without
limitation, any thereof referred to in SCHEDULE 2, and (b) all applications
for letters patent of the United States or any other country and all
divisions, continuations and continuations-in-part thereof, including,
without limitation, any thereof referred to in SCHEDULE 2.
"PATENT LICENSE": all agreements, whether written or oral, providing for
the grant by or to any Grantor of any right to manufacture, use or sell any
invention covered by a Patent, including, without limitation, any thereof
referred to in SCHEDULE 2.
"TRADEMARKS": (a) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service
marks, logos and other source or business identifiers, and the goodwill
associated therewith, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, whether in the United States Patent and Trademark Office or in any
similar office or agency of the United States, any State thereof or any other
country or any political subdivision thereof, or otherwise, including,
without limitation, any thereof referred to in SCHEDULE 3, and (b) all
renewals thereof.
"TRADEMARK LICENSE" means any written agreement, providing for the grant
by or to any Grantor of any right to use any Trademark, including, without
limitation, any thereof referred to in SCHEDULE 3.
"US CASH COLLATERAL ACCOUNT": a non-interest bearing cash deposit account
with The Chase Manhattan Bank at its office at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx, 00000, account number 000-0-000000, in the name of the Administrative
Agent and under its sole dominion and control and subject to the terms of
this Agreement.
"UNAFFIXED TAX STAMPS": tax stamps in respect of local and state
cigarette taxes that are not physically attached to the Cigarette Inventory
as defined in the Credit Agreement;
"VEHICLES" means all cars, trucks, trailers, construction and earth
moving equipment and other vehicles covered by a certificate of title law of
any state.
1.2 OTHER DEFINITIONAL PROVISIONS. (a) The words "hereof," "herein",
"hereto" and "hereunder" and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Section, subsection and Schedule references
are to this Agreement unless otherwise specified.
(b) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
6
2. GRANT OF SECURITY INTEREST. As collateral security for the prompt and
complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of the Obligations, each Grantor hereby grants to
the Administrative Agent for the ratable benefit of the Lenders a security
interest in all of the following property now owned or at any time hereafter
acquired by such Grantor or in which such Grantor now has or at any time in
the future may acquire any right, title or interest (collectively, the
"COLLATERAL"):
(a) all Account Collateral;
(b) all Accounts;
(c) all Chattel Paper;
(d) all Contracts;
(e) all Copyrights;
(f) all Copyright Licenses;
(g) all Documents;
(h) all Equipment;
(i) all General Intangibles;
(j) all Instruments;
(k) all Inventory;
(l) all Patents;
(m) all Patent Licenses;
(n) all Trademarks;
(o) all Trademark Licenses;
(p) all Unaffixed Tax Stamps;
(q) all Vehicles;
(r) all books and records pertaining to the Collateral; and
7
(s) to the extent not otherwise included, all Proceeds and products of
any and all of the foregoing and all collateral security and guarantees given
by any Person with respect to any of the foregoing.
3. REPRESENTATIONS AND WARRANTIES. Each Grantor hereby represents and
warrants, as to itself that:
3.1 TITLE; NO OTHER LIENS. Except for the security interest granted to
the Administrative Agent for the ratable benefit of the Lenders pursuant to
this Agreement and the other Liens permitted to exist on the Collateral
pursuant to the Credit Agreement, such Grantor owns each item of the
Collateral free and clear of any and all Liens or claims of others. No
financing statement or other public notice with respect to all or any part of
the Collateral is on file or of record in any public office, except such as
have been filed in favor of the Administrative Agent, for the ratable benefit
of the Lenders, pursuant to this Agreement or as are permitted pursuant to
the Credit Agreement and except for financing statements relating to property
in which such Grantor has no interest other than an interest arising under an
operating lease.
3.2 PERFECTED FIRST PRIORITY LIENS. Effective upon the filing of
appropriate financing statements, the filing with and recording by the United
States Patent and Trademark Office and the United States Copyright Office of
this Security Agreement, and all other appropriate action having been duly
taken, the security interests granted pursuant to this Agreement constitute
perfected security interests in the Collateral (other than the Vehicles,
except to the extent that the appropriate steps for perfection have been
taken pursuant to subsection ) in favor of the Administrative Agent, for the
ratable benefit of the Lenders, as collateral security for the Obligations
and are prior to all other Liens on the Collateral in existence on the date
hereof except for Liens permitted pursuant to the Credit Agreement.
3.3 INVENTORY AND EQUIPMENT. The Inventory and the Equipment are kept at
the locations listed on SCHEDULE 5.
3.4 CHIEF EXECUTIVE OFFICE. The location of such Grantor's chief
executive office or sole place of business is specified on SCHEDULE 6.
3.5 FARM PRODUCTS. No material portion of the Collateral constitutes, or
is the Proceeds of, Farm Products.
4. COVENANTS. Each Grantor covenants and agrees with the Administrative
Agent and the Lenders that, from and after the date of this Agreement until
the Obligations shall have been paid in full, the Commitments shall have
expired or otherwise been terminated and no Letters of Credit are
outstanding, as follows:
4.1 DELIVERY OF INSTRUMENTS AND CHATTEL PAPER. If any amount payable
under or in connection with any of the Collateral shall be or become
evidenced by any Instrument
8
or Chattel Paper and such amount exceeds $100,000, such Instrument or Chattel
Paper shall be added to SCHEDULE 8. If requested by the Administrative Agent
each such Instrument or Chattel Paper shall be promptly delivered to the
Administrative Agent, duly indorsed in a manner satisfactory to the
Administrative Agent, to be held as Collateral pursuant to this Agreement.
4.2 MAINTENANCE OF INSURANCE. (a) Such Grantor (or the Borrower, on
behalf of such Grantor) will maintain, with financially sound and reputable
companies, insurance policies (1) insuring the Inventory, Equipment and
Vehicles against loss by fire, explosion, theft and such other casualties as
may be reasonably satisfactory to the Administrative Agent and (2) insuring
such Grantor, the Administrative Agent and the Lenders against liability for
personal injury and property damage relating to such Inventory, Equipment and
Vehicles, such policies to be in such form and amounts and having such
coverage as may be reasonably satisfactory to the Administrative Agent and
the Lenders, with losses payable to such Grantor (or the Borrower, on behalf
of such Grantor), the Administrative Agent and the Lenders as their
respective interests may appear.
(b) All such insurance shall (1) provide that no cancellation, material
reduction in amount or material change in coverage thereof shall be effective
until at least 30 days after receipt by the Administrative Agent of written
notice thereof, (2) name the Administrative Agent and the Lenders as insured
parties, (3) include a breach of warranty clause and (4) be reasonably
satisfactory in all other respects to the Administrative Agent.
(c) Such Grantor shall deliver to the Administrative Agent and the
Lenders a certificate of a reputable insurance broker with respect to such
insurance during the month of August in each calendar year and such
supplemental reports with respect thereto as the Administrative Agent may
from time to time reasonably request.
4.3 MAINTENANCE OF PERFECTED SECURITY INTEREST; FURTHER DOCUMENTATION.
(a) Such Grantor shall maintain the security interest created by this
Agreement as a perfected security interest having at least the priority
described in subsection and shall defend such security interest against the
claims and demands of all Persons whomsoever.
(b) At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of such Grantor, such Grantor
will promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Administrative Agent may
reasonably request for the purpose of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted,
including, without limitation, (i) the filing of any financing or
continuation statements under the Uniform Commercial Code or their foreign
equivalent in effect in any jurisdiction with respect to the security
interests created hereby and (ii) after an Event of Default and at the
request of the Administrative Agent, the delivery of certificates of title
with respect to Vehicles to the Administrative Agent, properly endorsed in
accordance with applicable law, and the filing of any appropriate lien
documents with the relevant state authorities.
9
4.4 CHANGES IN LOCATIONS, NAME, ETC. Such Grantor will not:
(a) permit any of the Inventory or Equipment to be kept at a location
other than those listed on SCHEDULE 5 unless it gives the Administrative
Agent notice and takes all steps reasonably necessary or advisable, in the
judgment of the Administrative Agent, to maintain the perfection and priority
in such Inventory and Equipment as set forth in subsection ;
(b) change the location of its chief executive office from that specified
in subsection , unless it shall have given the Administrative Agent and the
Lenders at least 30 days' prior written notice of such change and takes all
steps reasonably necessary or advisable, in the judgment of the
Administrative Agent, to maintain the perfection and priority of the security
interests granted pursuant to this Agreement; or
(c) change its name, identity or corporate structure to such an extent
that any financing statement filed by the Administrative Agent in connection
with this Agreement would become seriously misleading, unless it shall have
given the Administrative Agent and the Lenders at least 30 days' prior
written notice of such change and takes all steps reasonably necessary or
advisable, in the judgment of the Administrative Agent, to maintain the
perfection and priority of the security interests granted pursuant to this
Agreement.
4.5 FURTHER IDENTIFICATION OF COLLATERAL. Such Grantor will furnish
to the Administrative Agent and the Lenders from time to time statements and
schedules further identifying and describing the Collateral and such other
reports in connection with the Collateral as the Administrative Agent may
reasonably request, all in reasonable detail.
4.6 NOTICES. Such Grantor will advise the Administrative Agent and
the Lenders promptly after becoming aware thereof, in reasonable detail, at
their respective addresses for notices provided for in the Credit Agreement
of:
(a) any Lien (other than security interests created hereby or Liens
permitted under the Credit Agreement) on any of the Collateral; and
(b) the occurrence of any other event which could reasonably be expected
to have a material adverse effect on the aggregate value of the Collateral or
on the security interests created hereby.
5. PROVISIONS RELATING TO ACCOUNTS.
5. Grantors Remain Liable under Accounts. Anything herein to the
contrary notwithstanding, as between any Grantor and the Administrative
Agent, each Grantor shall remain liable under each of the Accounts to observe
and perform all the conditions and obligations to be observed and performed
by it thereunder, all in accordance with the terms of
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any agreement giving rise to each such Account. Neither the Administrative
Agent nor any Lender shall have any obligation or liability under any Account
(or any agreement giving rise thereto) by reason of or arising out of this
Agreement or the receipt by the Administrative Agent or any Lender of any
payment relating to such Account pursuant hereto, nor shall the
Administrative Agent or any Lender be obligated in any manner to perform any
of the obligations of any Grantor under or pursuant to any Account (or any
agreement giving rise thereto), to make any payment, to make any inquiry as
to the nature or the sufficiency of any payment received by it or as to the
sufficiency of any performance by any party under any Account (or any
agreement giving rise thereto), to present or file any claim, to take any
action to enforce any performance or to collect the payment of any amounts
which may have been assigned to it or to which it may be entitled at any time
or times.
5.2 ANALYSIS OF ACCOUNTS. The Administrative Agent shall have the
right to make test verifications of the Accounts in any manner and through
any medium that it reasonably considers advisable, and each Grantor shall
furnish all such assistance and information as the Administrative Agent
reasonably may require in connection with such test verifications. The
Administrative Agent in its own name or in the name of others may communicate
with the obligors on the Accounts to verify with them to the Administrative
Agent's satisfaction the existence, amount and terms of any Accounts.
5.3 COLLECTIONS ON ACCOUNTS. (a) To the extent that any obligor makes
payments in respect of Accounts, the Administrative Agent hereby authorizes
each Grantor to collect such Accounts, subject to the Administrative Agent's
direction and control as set forth in this Section, and the Administrative
Agent may curtail or terminate said authority at any time after the
occurrence and during the continuance of an Event of Default. Each Grantor
shall, upon receipt of any payments made directly to such Grantor in respect
of Accounts (1) forthwith (and, in any event, within two Business Days) deposit
such amounts duly indorsed by such Grantor if required, in a Deposit Account
or Depository Account, as the case may be, and (2) until so turned over, shall
be held by such Grantor in trust for the Administrative Agent for the benefit
of the Lenders.
(b) No less frequently than once a month, the Borrower shall deliver to
the Administrative Agent a revised SCHEDULE 8, reflecting all collections in
respect of the preceding month in respect of Instruments or Chattel Paper
listed on such schedule.
(c) At the Administrative Agent's request, each Grantor shall deliver to
the Administrative Agent all original and other documents evidencing, and
relating to, the agreements and transactions which gave rise to any Accounts
exceeding $100,000, including, without limitation, all original orders,
invoices and shipping receipts.
5.4 MAINTAINING THE US CASH COLLATERAL ACCOUNT AND THE L/C CASH
COLLATERAL ACCOUNT. Until the Obligations shall have been paid in full, the
Commitments shall have expired or otherwise been terminated and no Letters of
Credit are outstanding:
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(a) The Borrower shall maintain the US Cash Collateral Account and the
L/C Cash Collateral Account with The Chase Manhattan Bank.
(b) It shall be a term and condition of each of the US Cash Collateral
Account and the L/C Cash Collateral Account, notwithstanding any term or
condition to the contrary in any other agreement relating to the US Cash
Collateral Account or the L/C Cash Collateral Account, as the case may be,
and except as otherwise provided by the provisions of Section 5.7 and Section
8, that no amount (including interest on Collateral Investments) shall be
paid or released to or for the account of, or withdrawn by or for the account
of, any Grantor or any other Person from the US Cash Collateral Account or
the L/C Cash Collateral Account, as the case may be.
The US Cash Collateral Account and the L/C Cash Collateral Account shall be
subject to such applicable laws, and such applicable regulations of the Board
of Governors of the Federal Reserve System and of any other appropriate
banking or governmental authority, as may now or hereafter be in effect.
5.5 MAINTAINING THE DEPOSITORY ACCOUNTS, THE DEPOSIT ACCOUNTS, THE
CANADIAN CASH COLLATERAL ACCOUNT AND THE COLLECTION ACCOUNTS. Until the
Obligations shall have been paid in full, the Commitments shall have expired
or otherwise been terminated and no Letters of Credit are outstanding:
(a) The Grantors shall maintain (1) lockboxes and blocked deposit
accounts in the United States ("DEPOSITORY ACCOUNTS") only with banks
("DEPOSITORY BANKS") that have entered into letter agreements in
substantially the form of Exhibit A-1 with the Grantors and the
Administrative Agent ("DEPOSITORY LETTERS") or in form and substance
reasonably acceptable to the Borrower and the Administrative Agent, (2)
deposit accounts in Canada ("DEPOSIT ACCOUNTS") only with banks ("DEPOSIT
BANKS") that (i) are listed on SCHEDULE 7 (as such schedule may be amended or
supplemented from time to time) and (ii) within 60 days of the Closing Date
shall have entered into letter agreements in substantially the form of
Exhibit A-2-B with the Grantors and the Administrative Agent ("Deposit
Account Letters") or in form and substance reasonably acceptable to the
Borrower and the Administrative Agent and (3) the Canadian Cash Collateral
Account.
(b) The Grantors shall maintain the Collection Accounts in the United
States only with the banks listed as Collection Account banks on SCHEDULE 7
hereto, reasonably acceptable to the Administrative Agent (the "COLLECTION
ACCOUNT BANKS") and have entered into a letter agreement in substantially the
form of Exhibit A-3 with such Grantor and the Administrative Agent (the
"COLLECTION ACCOUNT LETTER") or in form and substance reasonably acceptable
to such Grantor and the Administrative Agent.
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(c) The Grantors shall instruct each Depository Bank to forward an amount
equal to the available balance of the Depository Account at such Depository
Bank to a Collection Account, at the beginning of each Business Day, in same
day funds and shall cause each Deposit Bank to forward an amount equal to the
available balance of the Deposit Account at such Deposit Bank to the Canadian
Cash Collateral Account, at least once a week, in same day funds.
(d) The Grantors shall instruct each Collection Account Bank to transfer
to the US Cash Collateral Account, at the beginning of each Business Day, in
same day funds, an amount equal to the available balance of such Collection
Accounts.
(e) Upon any termination of any Depository Letter or other agreement with
respect to the maintenance of a Depository Account, the Borrower shall
immediately notify all Obligors that were making payments to such Depository
Account to make all future payments to another Depository Account or to the
Collection Accounts.
(f) Upon any termination of any Deposit Account Letter or other agreement
with respect to the maintenance of a Deposit Account the Borrower shall
immediately notify all Obligors that were making payments to such Deposit
Account to make all future payments to another Deposit Account or to the
Canadian Cash Collateral Account.
(g) The Grantors agree to terminate any or all Depository Accounts,
Depository Letters, Deposit Accounts, Deposit Account Letters, the Collection
Accounts and the Collection Account Letter upon request by the Administrative
Agent made after the occurrence and during the continuance of an Event of
Default.
5.6 INVESTING OF AMOUNTS IN THE US CASH COLLATERAL ACCOUNT AND THE L/C
CASH COLLATERAL ACCOUNT. If requested by the Borrower, the Administrative
Agent will, subject to the provisions of Section 5.7 and Section 8, from time
to time (a) invest amounts on deposit in the US Cash Collateral Account and
the L/C Cash Collateral Account in such US Cash Equivalents in the name of
the Administrative Agent and (b) invest interest paid on the US Cash
Equivalents referred to in clause (a) above, and reinvest other proceeds of
any such US Cash Equivalents that may mature or be sold, in each case in such
US Cash Equivalents in the name of the Administrative Agent (the US Cash
Equivalents referred to in clauses (a) and (b) above being collectively
"COLLATERAL INVESTMENTS"). Interest and proceeds that are not invested or
reinvested in Collateral Investments as provided above shall be deposited and
held in the US Cash Collateral Account or the L/C Cash Collateral Account, as
the case may be.
5.7 APPLICATION AND RELEASE OF FUNDS. (a) So long as the notice
contemplated by the next succeeding paragraph has not been given or, if
given, is not still in effect, on each Business Day the Administrative Agent
shall apply the available funds then on deposit in the US Cash Collateral
Account in the following order of priority: FIRST, to pay interest, fees,
13
expenses and other amounts (other than principal) then due and payable under
the Loan Documents, SECOND, to pay the principal amount of any Revolving
Credit Loan that is an ABR Loan, if any such principal amount is then
outstanding, THIRD, if such Business Day is the last day of an Interest
Period for any Eurodollar Loan that is a Revolving Credit Loan, to pay all
such Eurodollar Loans to the extent thereof. Any amounts remaining in the US
Cash Collateral Account after application as set forth in the preceding
sentence shall be held in the US Cash Collateral Account as Collateral for
the Obligations.
If an Event of Default has occurred and is continuing and the
Administrative Agent has given notice to the Borrower of its intent to do so,
the Administrative Agent shall remit any funds on deposit in the US Cash
Collateral Account as follows: FIRST, to pay interest, fees, expenses and
other amounts (other than principal) then due and payable under the Loan
Documents, SECOND, to pay the Term Loans, the Aggregate Outstanding Revolving
Extensions of Credit and any amounts then due and payable under any Hedge
Agreement between the Borrower and any Lender and any Overdraft pro rata
based upon the respective amounts owing in respect thereof. Amounts
allocable to the Aggregate Outstanding Revolving Extensions of Credit shall
be further allocated as follows: FIRST to any amounts outstanding under the
Reimbursement Obligations, SECOND upon the payment in full of the
Reimbursement Obligations, to the outstanding Revolving Credit Loans and
THIRD to cash collateralize the aggregate then undrawn and unexpired amount
of all Letters of Credit by releasing any funds from the US Cash Collateral
Account to make the deposit to the L/C Cash Collateral Account in accordance
with Section 8 of the Credit Agreement).
(b) So long as no Event of Default has occurred and is continuing, the
Borrower may from time to time request that available funds on deposit in the
US Cash Collateral Account be released to the Borrower PROVIDED that on the
date of such requested release, the conditions set forth in subsection 5.2 of
the Credit Agreement shall have been satisfied.
5.8 REPRESENTATIONS AND WARRANTIES. (a) The amounts represented by the
Borrower to the Lenders from time to time as owing to the Grantors in respect
of the Accounts will at such times be accurate in material respects.
(b) No Grantor has any Depository Accounts or other deposit accounts
other than the Depository Accounts listed on SCHEDULE 7, the permitted
unblocked accounts listed on SCHEDULE 9, the Deposit Accounts listed on
SCHEDULE 7 and the Canadian Cash Collateral Account. The Grantors have
instructed (i) all Depository Banks to forward all amounts on deposit in the
Depository Accounts to the Collection Accounts, (ii) the Collection Account
Bank to forward all amounts on deposit in the Collection Account to the US
Cash Collateral Account and (iii) all Deposit Banks to forward all amounts on
deposit in the Deposit Accounts to the Canadian Cash Collateral Account.
5.9 COVENANTS. (a) The Grantors will not (i) grant any extension of the
time of payment of any Account, (ii) compromise or settle any Account for
less than the full
14
amount thereof, (iii) release, wholly or partially, any Person liable for the
payment of any Account, (iv) allow any credit or discount whatsoever on any
Account, (v) amend, supplement or modify any Account in any manner that could
adversely affect the value thereof or (vi) fail to exercise promptly and
diligently each and every material right which it may have under each
agreement giving rise to a Account (other than any right of termination),
except that so long as no Event of Default has occurred and is continuing and
the notice contemplated by the second paragraph of subsection 5.7(a) has not
been given, the Grantors may do any of the foregoing in the ordinary course
of business consistent with their past practice.
(b) The Borrower will deliver to the Administrative Agent a copy of each
material demand, notice or document received by it that questions the
validity or enforceability of more than 5% of the aggregate amount of the
then outstanding Accounts.
6. PROVISIONS RELATING TO CONTRACTS.
6.1 BORROWER REMAINS LIABLE UNDER CONTRACTS. Anything herein to the
contrary notwithstanding, as between each Grantor and the Administrative
Agent, each Grantor shall remain liable under each of the Contracts to
observe and perform all the conditions and obligations to be observed and
performed by it thereunder, all in accordance with and pursuant to the terms
and provisions of such Contract. Neither the Administrative Agent nor any
Lender shall have any obligation or liability under any Contract by reason of
or arising out of this Agreement or the receipt by the Administrative Agent
or any such Lender of any payment relating to such Contract pursuant hereto,
nor shall the Administrative Agent or any Lender be obligated in any manner
to perform any of the obligations of each Grantor under or pursuant to any
Contract, to make any payment, to make any inquiry as to the nature or the
sufficiency of any payment received by it or as to the sufficiency of any
performance by any party under any Contract, to present or file any claim, to
take any action to enforce any performance or to collect the payment of any
amounts which may have been assigned to it or to which it may be entitled at
any time or times.
6.2 COMMUNICATION WITH CONTRACTING PARTIES. After prior notice to the
Borrower of its intention to do so, the Administrative Agent in its own name
or in the name of others may communicate with parties to the Contracts to
verify with them to the Administrative Agent's reasonable satisfaction the
existence, amount and terms of any Contracts.
6.3 REPRESENTATIONS AND WARRANTIES. (a) No consent of any party (other
than each Grantor) to any Contract is required, or purports to be required,
in connection with the execution, delivery and performance of this Agreement.
(b) Each Contract is in full force and effect and constitutes a valid and
legally enforceable obligation of each Grantor and to each Grantor's
knowledge, the other parties thereto, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding
in equity or at law) and an implied covenant of good faith and fair dealing.
(c) No consent or authorization of, filing with or other act by or in
respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of any of the
Contracts by any party thereto other than those which have been duly
obtained, made or performed, are in full force and effect and do not subject
the scope of any such Contract to any material adverse limitation, either
specific or general in nature.
(d) Neither each Grantor nor (to the best of each Grantor's knowledge)
any of the other parties to the Contracts is in default in the performance or
observance of any of the terms thereof in any manner that, in the aggregate,
could reasonably be expected to have a Material Adverse Effect.
(e) The right, title and interest of each Grantor in, to and under the
Contracts are not subject to any defenses, offsets, counterclaims or claims
that, in the aggregate, could reasonably be expected to have a Material
Adverse Effect.
6.4 COVENANTS. (a) Each Grantor will perform and comply in all material
respects with all its obligations under the Contracts which the failure to so
do could reasonably be expected to materially adversely affect the value of
such Contract as Collateral.
(b) Each Grantor will not amend, modify, terminate or waive any provision
of any Contract in any manner which could reasonably be expected to
materially adversely affect the value of such Contract as Collateral.
(c) Each Grantor will exercise promptly and diligently each and every
material right which it may have under each Contract (other than any right of
termination) which the failure to so do could reasonably be expected to
materially adversely affect the value of such Contract as Collateral.
(d) Each Grantor will deliver to the Administrative Agent a copy of each
material demand, notice or document received by it relating in any way to any
Contract that questions the validity or enforceability of such Contract.
7. PROVISIONS RELATING TO COPYRIGHTS, PATENTS AND TRADEMARKS.
7.1 REPRESENTATIONS AND WARRANTIES. (a) SCHEDULE 1 includes all
material Copyright and Copyright Licenses owned by each Grantor in its own
name on the date hereof.
(b) SCHEDULE 2 includes all Patents and Patent Licenses owned by each
Grantor in its own name on the date hereof.
16
(c) SCHEDULE 3 includes all registered Trademarks, applications therefor
and Trademark Licenses owned by each Grantor in its own name on the date
hereof.
(d) To the best of each Grantor's knowledge, each material Copyright,
Patent and Trademark is on the date hereof valid, subsisting, unexpired,
enforceable and has not been abandoned.
(e) Except as set forth in either SCHEDULE 1, SCHEDULE 2 or SCHEDULE 3,
none of such Copyrights, Patents and Trademarks is on the date hereof the
subject of any licensing or franchise agreement.
(f) No holding, decision or judgment has been rendered by any
Governmental Authority which would limit, cancel or question the validity of
any Copyright, Patent or Trademark in any respect that could reasonably be
expected to have a Material Adverse Effect.
(g) No action or proceeding is pending on the date hereof seeking to
limit, cancel or question the validity of any material Copyright, Patent or
Trademark, or which, if adversely determined, would have a material adverse
effect on the value of any material Copyright, Patent or Trademark.
7.2 COVENANTS.
(a) Each Grantor (either itself or through licensees) will (1) continue
to use each material Trademark on each and every trademark class of goods
applicable to its current line as reflected in its current catalogs,
brochures and price lists in order to maintain such Trademark in full force
free from any claim of abandonment for non-use, (2) maintain as in the past
the quality of products and services offered under such Trademark, (3) employ
such Trademark with the appropriate notice of registration, (4) not adopt or
use any xxxx which is confusingly similar or a colorable imitation of such
Trademark unless the Administrative Agent, for the ratable benefit of the
Lenders, shall obtain a perfected security interest in such xxxx pursuant to
this Agreement, and (5) not (and not permit any licensee or sublicensee
thereof to) do any act or knowingly omit to do any act whereby such Trademark
may become invalidated.
(b) Each Grantor will not do any act, or omit to do any act, whereby any
material Patent may become abandoned or dedicated.
(c) Each Grantor will notify the Administrative Agent and the Lenders
immediately if it knows, or has reason to know, that any application or
registration relating to any material Patent or Trademark may become
abandoned or dedicated, or of any adverse determination or development
(including, without limitation, the institution of, or any such determination
or development in, any proceeding in the United States Patent and Trademark
Office or any similar office or agency in any other county or political
subdivision thereof or
17
any court or tribunal in any country) regarding each Grantor's ownership of
any material Patent or Trademark or its right to register the same or to keep
and maintain the same.
(d) Whenever each Grantor, either by itself or through any agent,
employee, licensee or designee, shall file an application for the
registration of any Patent or Trademark with the United States Patent and
Trademark Office or any similar office or agency in any other country or any
political subdivision thereof, each Grantor shall report such filing to the
Administrative Agent and the Lenders within five Business Days after the last
day of the fiscal quarter in which such filing occurs. Upon request of the
Administrative Agent, each Grantor shall execute and deliver any and all
agreements, instruments, documents, and papers as the Administrative Agent
may request to evidence the Administrative Agent's and the Lenders' security
interest in any Patent or Trademark and the goodwill and general intangibles
of each Grantor relating thereto or represented thereby.
(e) Each Grantor will take all reasonable and necessary steps, including,
without limitation, in any proceeding before the United States Patent and
Trademark Office, or any similar office or agency in any other country or any
political subdivision thereof, to maintain and pursue each application (and
to obtain the relevant registration) for and to maintain each registration of
the material Patents and Trademarks, including, without limitation, filing of
applications for renewal, affidavits of use and affidavits of
incontestability.
(f) In the event that any Patent or Trademark is infringed,
misappropriated or diluted by a third party, each Grantor shall (i) take such
actions as each Grantor shall reasonably deem appropriate under the
circumstances to protect such Patent or Trademark and (ii) if such Patent or
Trademark is of material economic value, promptly notify the Administrative
Agent and the Lenders after it learns thereof and xxx for infringement,
misappropriation or dilution, to seek injunctive relief where appropriate and
to recover any and all damages for such infringement, misappropriation or
dilution.
8. REMEDIES.
8.1 NOTICE TO OBLIGORS AND CONTRACT PARTIES. Upon the request of the
Administrative Agent at any time after the occurrence and during the
continuance of an Event of Default, each Grantor shall notify obligors on the
Accounts and parties to the Contracts that the Accounts and the Contracts
have been assigned to the Administrative Agent for the ratable benefit of the
Lenders and that payments in respect thereof shall be made directly to the
Administrative Agent. At any time and from time to time after the occurrence
and during the continuance of an Event of Default, the Administrative Agent
may in its own name or in the name of others communicate with the parties to
the Contracts (or the parties to any other contract (as defined in the Code)
to which each Grantor is a party) to verify with them to its satisfaction the
existence, amount and terms of any such Contracts (or such other contracts).
18
8.2 PROCEEDS TO BE TURNED OVER TO ADMINISTRATIVE AGENT. In addition to
the rights of the Administrative Agent specified in subsection 5 and with
respect to payments of Accounts, if an Event of Default shall occur and be
continuing and the notice contemplated by the second paragraph of subsection
5.7(a) has been given, all Proceeds of any Collateral received by each
Grantor consisting of cash, checks and other near-cash items shall be held by
each Grantor in trust for the Administrative Agent for the benefit of the
Lenders, segregated from other funds of each Grantor, and shall, forthwith
upon receipt by each Grantor, be turned over to the Administrative Agent
(duly indorsed by each Grantor to the Administrative Agent, if required) and
held by the Administrative Agent in the US Cash Collateral Account. All
Proceeds while held by the Administrative Agent in the US Cash Collateral
Account (or by each Grantor in trust for the Administrative Agent for the
benefit of the Lenders) shall continue to be held as collateral security for
all the Obligations and shall not constitute payment thereof until applied as
provided in subsection 5.7.
8.3 CODE REMEDIES. If an Event of Default shall occur and be continuing,
the Administrative Agent, on behalf of the Lenders, may exercise, in addition
to all other rights and remedies granted to them in this Agreement and in any
other instrument or agreement securing, evidencing or relating to the
Obligations, all rights and remedies of a secured party under the Code or any
applicable law. Without limiting the generality of the foregoing, the
Administrative Agent, without demand of performance or other demand,
presentment, protest, advertisement or notice of any kind (except any notice
required by law referred to below) to or upon each Grantor or any other
Person (all and each of which demands, defenses, advertisements and notices
are hereby waived), may in such circumstances forthwith collect, receive,
appropriate and realize upon the Collateral, or any part thereof, and/or may
forthwith sell, lease, assign, give an option or options to purchase, or
otherwise dispose of and deliver the Collateral or any part thereof (or
contract to do any of the foregoing), in one or more parcels at public or
private sale or sales, at any exchange, broker's board or office of the
Administrative Agent or any Lender or elsewhere upon such terms and
conditions as it may deem advisable and at such prices as it may deem best,
for cash or on credit or for future delivery without assumption of any credit
risk. The Administrative Agent or any Lender shall have the right upon any
such public sale or sales, and, to the extent permitted by law, upon any such
private sale or sales, to purchase the whole or any part of the Collateral so
sold, free of any right or equity of redemption in each Grantor, which right
or equity is hereby waived or released. Each Grantor further agrees, at the
Administrative Agent's request, to assemble the Collateral and make it
available to the Administrative Agent at places which the Administrative
Agent shall reasonably select, whether at each Grantor's premises or
elsewhere. The Administrative Agent shall apply the net proceeds of any
action taken by it pursuant to this subsection, after deducting all
reasonable costs and expenses of every kind incurred in connection therewith
or incidental to the care or safekeeping of any of the Collateral or in any
way relating to the Collateral or the rights of the Administrative Agent
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements, to the payment in whole or in part of the Obligations, in such
order as provided in subsection 5.7 and only after such application and after
the payment by the Administrative Agent of any other amount required by any
provision of law, including, without limitation, Section 9-
19
504(1)(c) of the Code, need the Administrative Agent account for the surplus,
if any, to each Grantor. To the extent permitted by applicable law, each
Grantor waives all claims, damages and demands it may acquire against the
Administrative Agent arising out of the exercise by it of any rights
hereunder. If any notice of a proposed sale or other disposition of
Collateral shall be required by law, such notice shall be deemed reasonable
and proper if given at least 10 days before such sale or other disposition.
9. ADMINISTRATIVE AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT; ADMINISTRATIVE
AGENT'S PERFORMANCE OF BORROWER'S OBLIGATIONS.
9.1 POWERS. Upon the occurrence and during the continuance of an Event
of Default, each Grantor hereby irrevocably constitutes and appoints the
Administrative Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of each Grantor and in the name of
each Grantor or in its own name, for the purpose of carrying out the terms of
this Agreement, to take any and all appropriate action and to execute any and
all documents and instruments which may be necessary or desirable to
accomplish the purposes of this Agreement, and, without limiting the
generality of the foregoing, each Grantor hereby gives the Administrative
Agent the power and right, on behalf of each Grantor, without notice to or
assent by each Grantor, to do any or all of the following:
(a) in the name of each Grantor or its own name, or otherwise, take
possession of and indorse and collect any checks, drafts, notes, acceptances
or other instruments for the payment of moneys due under any Account or
Contract or with respect to any other Collateral and file any claim or take
any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Administrative Agent for the purpose of collecting
any and all such moneys due under any Account or Contract or with respect to
any other Collateral whenever payable;
(b) in the case of any Copyright, Patent or Trademark, execute and
deliver any and all agreements, instruments, documents and papers as the
Administrative Agent may request to evidence the Administrative Agent's
security interest in such Copyright, Patent or Trademark and the goodwill and
general intangibles of each Grantor relating thereto or represented thereby;
(c) pay or discharge taxes and Liens levied or placed on or threatened
against the Collateral, effect any repairs or any insurance called for by the
terms of this Agreement and pay all or any part of the premiums therefor and
the costs thereof;
(d) execute, in connection with any sale provided for in subsection 8.3 ,
any endorsements, assignments or other instruments of conveyance or transfer
with respect to the Collateral; and
20
(e)(1) direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative
Agent shall direct; (2) ask or demand for, collect, receive payment of and
receipt for, any and all moneys, claims and other amounts due or to become
due at any time in respect of or arising out of any Collateral; (3) sign and
indorse any invoices, freight or express bills, bills of lading, storage or
warehouse receipts, drafts against debtors, assignments, verifications,
notices and other documents in connection with any of the Collateral; (4)
commence and prosecute any suits, actions or proceedings at law or in equity
in any court of competent jurisdiction to collect the Collateral or any
thereof and to enforce any other right in respect of any Collateral; (5)
defend any suit, action or proceeding brought against each Grantor with
respect to any Collateral; (6) settle, compromise or adjust any such suit,
action or proceeding and, in connection therewith, to give such discharges or
releases as the Administrative Agent may deem appropriate; (7) assign any
Copyright, Patent or Trademark (along with the goodwill of the business to
which any such Copyright, Patent or Trademark pertains), throughout the world
for such term or terms, on such conditions, and in such manner, as the
Administrative Agent shall in its sole discretion determine; and (8)
generally, sell, transfer, pledge and make any agreement with respect to or
otherwise deal with any of the Collateral as fully and completely as though
the Administrative Agent were the absolute owner thereof for all purposes,
and do, at the Administrative Agent's option and each Grantor's expense, at
any time, or from time to time, all acts and things which the Administrative
Agent deems necessary to protect, preserve or realize upon the Collateral and
the Administrative Agent's security interests therein and to effect the
intent of this Agreement, all as fully and effectively as each Grantor might
do.
Anything in this subsection to the contrary notwithstanding, the
Administrative Agent agrees that it will not exercise any rights under the
power of attorney provided for in this subsection unless an Event of Default
shall have occurred and be continuing.
9.2 PERFORMANCE BY ADMINISTRATIVE AGENT OF BORROWER'S OBLIGATIONS. If
each Grantor fails to perform or comply with any of its agreements contained
herein, the Administrative Agent, at its option, but without any obligation
so to do, may perform or comply, or otherwise cause performance or
compliance, with such agreement.
9.3 BORROWER'S REIMBURSEMENT OBLIGATION. The expenses of the
Administrative Agent incurred in connection with actions undertaken as
provided in this Section, together with interest thereon at a rate per annum
equal to the rate per annum at which interest would then be payable on past
due ABR Loans under the Credit Agreement, from the date of payment by the
Administrative Agent to the date reimbursed by each Grantor, shall be payable
by each Grantor to the Administrative Agent on demand.
9.4 RATIFICATION; POWER COUPLED WITH AN INTEREST. Each Grantor hereby
ratifies all that said attorneys shall lawfully do or cause to be done by
virtue hereof and in
21
accordance with the terms hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interests created hereby
are released.
10. DUTY OF ADMINISTRATIVE AGENT. The Administrative Agent's sole duty
with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Code or otherwise,
shall be to deal with it in the same manner as the Administrative Agent deals
with similar property for its own account. Neither the Administrative Agent,
any Lender nor any of their respective officers, directors, employees or
agents shall be liable for failure to demand, collect or realize upon any of
the Collateral or for any delay in doing so or shall be under any obligation
to sell or otherwise dispose of any Collateral upon the request of each
Grantor or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. The powers conferred on the
Administrative Agent hereunder are solely to protect the Administrative
Agent's interests in the Collateral and shall not impose any duty upon the
Administrative Agent or any Lender to exercise any such powers. The
Administrative Agent and the Lenders shall be accountable only for amounts
that they actually receive as a result of the exercise of such powers, and
neither they nor any of their officers, directors, employees or agents shall
be responsible to each Grantor for any act or failure to act hereunder,
except for their own gross negligence or willful misconduct.
11. EXECUTIION OF FINANCING STATEMENTS. Pursuant to Section 9-402 of the
Code or any applicable law, each Grantor authorizes the Administrative Agent
to file financing statements with respect to the Collateral without the
signature of each Grantor in such form and in such filing offices as the
Administrative Agent reasonably determines appropriate to perfect the
security interests of the Administrative Agent under this Agreement. A
carbon, photographic or other reproduction of this Agreement shall be
sufficient as a financing statement for filing in any jurisdiction (except in
Canada).
12. AUTHORITY OF ADMINISTRATIVE AGENT. Each Grantor acknowledges that the
rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise
or non-exercise by the Administrative Agent of any option, voting right,
request, judgment or other right or remedy provided for herein or resulting
or arising out of this Agreement shall, as between the Administrative Agent
and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them,
but, as between the Administrative Agent and each Grantor, the Administrative
Agent shall be conclusively presumed to be acting as agent for the Lenders
with full and valid authority so to act or refrain from acting, and each
Grantor shall be under no obligation, or entitlement, to make any inquiry
respecting such authority.
13. NOTICES. All notices, requests and demands to or upon the
Administrative Agent or each Grantor hereunder shall be effected in the
manner provided for in subsection 10.2 of the Credit Agreement.
22
14. SEVERABILITY. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
15. AMENDMENTS IN WRITING; NO WAIVER; CUMULATIVE REMEDIES.
15.1 AMENDMENTS IN WRITING. None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except
by a written instrument executed by each Grantor and the Administrative
Agent, PROVIDED that any provision of this Agreement imposing obligations on
any Grantor may be waived by the Administrative Agent in a written instrument
executed by the Administrative Agent.
15.2 NO WAIVER BY COURSE OF CONDUCT. Neither the Administrative Agent
nor any Lender shall by any act (except by a written instrument pursuant to
subsection 15.1), delay, indulgence, omission or otherwise be deemed to have
waived any right or remedy hereunder or to have acquiesced in any Default or
Event of Default. No failure to exercise, nor any delay in exercising, on
the part of the Administrative Agent or any Lender, any right, power or
privilege hereunder shall operate as a waiver thereof. No single or partial
exercise of any right, power or privilege hereunder shall preclude any other
or further exercise thereof or the exercise of any other right, power or
privilege. A waiver by the Administrative Agent or any Lender of any right
or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which the Administrative Agent or such Lender would
otherwise have on any future occasion.
15.3 REMEDIES CUMULATIVE. The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.
16. SECTION HEADINGS. The Section and subsection headings used in this
Agreement are for convenience of reference only and are not to affect the
construction hereof or be taken into consideration in the interpretation
hereof.
17. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and permitted
assigns under the Credit Agreement.
18. ATTACHMENT. The parties hereby acknowledge that (i) value has been
given; (ii) each Grantor has rights in the Collateral; (iii) they have not
agreed to postpone the time of attachment of the security interest; and (iv)
each Grantor has received a duplicate original copy of this Agreement.
23
19. GOVERNING LAW. This Agreement shall be governed by, and construed and
interpreted in accordance with, the law of the State of New York except with
respect to the security interests granted hereby in deposit accounts which
shall be governed by the law of the State of California.
20. TERMINATION AND RELEASE OF COLLATERAL. At such time as the
Obligations then due and payable have been fully satisfied and the
Commitments terminated, the Collateral shall be released from the lien
created by this Agreement, and the security interest created by this
Agreement and all obligations of the Grantors with respect thereto shall
terminate, all without delivery of any instrument or performance of any act
by any party, and all rights to the Collateral shall revert to the Grantors.
Upon request of any Grantor following any such termination, the
Administrative Agent will deliver (at the sole cost and expense of such
Grantor) to such Grantor any Collateral held by the Administrative Agent
hereunder, and execute and deliver (at the sole cost and expense of such
Grantor) to such Grantor such documents as such Grantor shall reasonably
request to evidence such termination.
21. WAIVERS OF JURY TRIAL. EACH GRANTOR, THE ADMINISTRATIVE AGENT AND THE
LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
24
IN WITNESS WHEREOF, the undersigned has caused this Security
Agreement to be duly executed and delivered as of the date first above
written.
CORE-XXXX INTERNATIONAL, INC.
By: ___________________________________
Name:
Title:
C/M PRODUCTS, INC.
By: ___________________________________
Name:
Title:
CORE-XXXX INTERRELATED COMPANIES,
INC.
By: ___________________________________
Name:
Title:
CORE-XXXX MIDCONTINENT, INC.
By: ___________________________________
Name:
Title:
STATE OF NEW YORK )
: ss:
COUNTY OF NEW YORK )
On August __, 1996, before me personally came ___________________,
to me known, who, by me duly sworn, did depose and say that deponent resides
at __________________________________, deponent is _____________________ of
_________________________________________________, the corporation described
in and which executed the foregoing instrument; that the seal affixed to said
instrument is the corporate seal of such corporation and that it was so
affixed by order of the Board of Directors of such corporation; and that
deponent signed deponent's name thereto by like order.
________________________________________
Notary Public
SCHEDULE 1
COPYRIGHTS AND COPYRIGHT LICENSES
The Company is a party to general software license agreements for programs
used in day to day operations (e.g., Lotus, Excel, Microsoft Word, etc.)
SCHEDULE 2
PATENTS AND PATENT LICENSES
-none-
SCHEDULE 3
TRADEMARKS AND TRADEMARK LICENSES
CORE-XXXX INTERNATIONAL, INC.
Registration Registration Renewal
Jurisdiction Xxxx Number Date Date
------------ ---- ----- ---- ----
United States Cable Car 929,258 2/15/72 2/15/02
United States Cable Car & 1,810,976 12/14/93 12/14/03
Design
United States Capt'n Slush 1,240,974 6/7/83 6/7/03
United States Convenience 2000 1,826,573 3/15/94 3/15/04
United States Convenience 2000 1,827,690 3/22/94 3/22/04
& Design
United States Core-Xxxx 1,283,707 6/26/84 6/26/04
United States Core-Xxxx & 1,834,121 5/3/94 5/3/04
Design
United States Core-Xxxx & 1,834,123 5/3/94 5/3/04
Design
United States Spacevues 1,742,013 12/22/92 12/22/02
United States Starmark 1,605,239 7/10/90 7/10/00
Canada Core-Xxxx TMA 272,823 10/15/82 10/15/97
Canada Core-Xxxx & TMA 279,410 5/13/83 5/13/98
Design
Canada Core-Xxxx & TMA 433,460 9/16/94 9/16/10
Design
Canada Core-Xxxx & TMA 432,801 9/02/94 9/02/10
Design
Canada Fast 'N Fresh TMA 349,558 12/23/88 12/23/03
Canada Fast 'N Tasty & TMA 456,145 3/22/96 3/22/11
Design
Trademark and Service Xxxx Applications
---------------------------------------
Application Application
Jurisdiction Xxxx Number Date
------------ ---- ------ ----
United States Starmark & 75/106,574 5/20/96
Design
United States Xxxxx'x To Go 75/023,295 11/22/95
United States Xxxxx'x To Go 75/072,803 3/14/96
& Design
SCHEDULE 3
TRADEMARKS AND TRADEMARK LICENSES
(PAGE 2)
CORE-XXXX INTERRELATED COMPANIES, INC
Registration Registration Renewal
Jurisdiction Xxxx Number Date Date
------------ --- ------ ---- -----
United States Best Buy 1,225,254 1/25/83 1/25/03
United States Best Buy 1,801,011 10/26/93 10/26/03
United States Best Buy 1,801,668 10/26/93 10/26/03
United States Best Buy 1,225,253 1/25/83 1/25/03
& Design
United States Best Buy 1,809,484 12/7/93 12/7/03
& Design
United States Best Buy 1,833,456 4/26/94 4/26/04
& Design
United States Best Buy 1,813,973 12/8/93 12/28/03
& Design
United States Major Brand 1,404,520 8/5/86 8/5/06
Canada Best Buy TMA335,175 12/11/877 12/11/02
& Design
Trademark and Service Xxxx Applications
---------------------------------------
Registration Registration Renewal
Jurisdiction Xxxx Number Date Date
------------ --- ------ ---- -----
None
SCHEDULE 3
TRADEMARKS AND TRADEMARK LICENSES
(PAGE 3)
TRADEMARK LICENSES
1. Trademark License Agreement, dated as of July 1, 1993, by and between
Famous Value Brands, a division of Xxxxxx Xxxxxx Incorporated (the
"Licensee") and CORE-XXXX INTERRELATED COMPANIES, INC. (the "Licensor").
2. Agreement, dated as of September 17, 1992, by and between Helme Tobacco
Company (the "Licensee") and C/M Products, Inc. (the "Licensor"), with
respect to trademarks owned by CORE-XXXX INTERRELATED COMPANIES, INC.
3. Non-Exclusive Dealer Agreements, dated a of November 1, 1993, by and
between Applied Business Corporation (the "Licensor") and CORE-XXXX
INTERNATIONAL, INC. (the "Licensee").
SCHEDULE 4
INTENTIONALLY LEFT BLANK
SCHEDULE 5
LOCATIONS OF EQUIPMENT AND INVENTORY
LOCATIONS OF EQUIPMENT:
U.S.
0000 Xxxxxxxxxx Xxxxx, X.X.
XXXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
000 Xxxx-Xxxx Xxxxx
XXXXXXXXXXX, Xxxx Xxxxxx, XX 00000
000 Xxxx Xxxxxx (note: AMI)
CORONA, Xxxxxxxxx Xxxxxx, XX 00000
000 Xxxxx Xxxxxx
XXXXXX, Xxxxxxxxx Xxxxxx, XX 00000
00000 Xxxxxxxxx Xx.
XXXXXXX, Xxxxxxx Xxxxxx, XX 00000
0000 Xxxx 00xx Xx.
XXXXXX, Xxx Xxxxxxx Xxxxxx, XX 00000
0000 Xxxx Xxxxxx
XXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
0000 Xxxxxx Xx.
XXXXXX, Xxxxx Xxxxxx, XX 00000
0000 Xxxx Xxxxxx
XXX XXXXX, Xxxxx Xxxxxx, XX 00000
000 Xxxxxxxxx Xx.
XXXX, Xxxxxx Xxxxxx, XX 00000
13551 X.X. Xxxxxxx (note: Xxxxxxxx Xxxxxxxx)
XXXXXXXXX, Xxxxxxxxx Xxxxxx, XX 00000
000 X.X. X Xx.
XXXXXX XXXX, Xxxxxxxxx Xxxxxx, XX 00000
3130 South 0000 Xxxx
XXXXX XXXX XXXX XXXX, Xxxx Xxxx Xxxxxx, XX
00000
North 0000 Xxxx Xx.
XXXXXXX, Xxxxxxx Xxxxxx, XX 00000
000 Xxxxxxx Xxxxxx #000
XXX XXXXXXXXX, Xxx Xxxxxxxxx, XX 00000
0000 Xxxxxxxxxx Xxxxx, X.X.
XXXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
0000 Xxxxxxxxxx Xxxx, #000
XXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
0000 Xxxx Xxxxxx Xx., Xxxxx 0
XXXXXXX, Xxxxxxxx Xxxxxx, XX 00000
0000 Xxxx Xx Xxxxx Xxx. Xxxx #0
XXXXXXX, Xxxxxx Xxxxxx, XX 00000
000 Xxxx Xxxx Xxxxxx Xx., Xxxx X
XXX XXXXXXXXXX, Xxx Xxxxxxxxxx Xxxxxx, XX
00000
0000 Xxxxx Xxxxx, Xxxxx X
XXX XXXXX, Xxx Xxxxx Xxxxxx, XX 00000
0000 X. Xxx Xxxxxxxx Xxxx., Xxxxx 000
XXXXXXX, Xxx Xxxxxxx Xxxxxx, XX 00000
00 Xxxx 0xx Xx.
XXXXXX, Xxxxxxxx Xxxxxx, XX 00000
000 Xxxxxx Xxxxx Blvd., Suite 000
XXXXX XXX XXXXXXXXX, Xxx Xxxxx Xxxxxx, XX
00000
0000 Xxxx Xxxxxx Xxxxxx Xx.
XXXX, Xxxxxxxxx Xxxxxx, XX 00000
0000 Xxxxx 00xx Xx.
XXXXXX, Xxxxxx Xxxxxx, XX 00000
000 X. Xxxxxxx Xxxx, #000
XXXX, Xxxxxx Xxxxxx, Xx 00000
0000 Xxxxxxx Xxx. Xxxx #X00
XXXXXX, Xxxxxx Xxxxxx, XX 00000
0000 Xxxxxxx Xxxx
XXXXXXX, Xxxxxxx Xxxxxx, XX 00000
1
SCHEDULE 5
PAGE 2
LOCATIONS OF EQUIPMENT: (CONT'D)
CANADA
0000 00xx Xxxxxx, Xxxxx 000
XXXXXXX, XX, X0X 0X0, Xxxxxx
00000 Xxxxxxxxxx Xxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
0000 Xxxxxxx Xxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
00 Xxxxxxxx Xxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
0000 Xxxxxx Xxx
XXXXXXXX, XX X0X 0X0, Xxxxxx
0000 Xxxxxx Xxxxxx
XXXXXX XXXXX, XX, X0X 0X0, Xxxxxx
00000 Xxxxxx Xxxxx, Xxxxx 000
XXXXXXXX, XX, X0X 0X0, Xxxxxx
00000 Xxxx Xxxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
0000 00xx Xxxxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
000 XxXxxxxx Xxxxxx
XXXXXX, XX, X0X, Xxxxxx
2
SCHEDULE 5
PAGE 3
LOCATIONS OF INVENTORY:
U.S.
0000 Xxxxxxxxxx Xxxxx, X.X.
XXXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
000 Xxxx-Xxxx Xxxxx
XXXXXXXXXXX, Xxxx Xxxxxx, XX 00000
000 Xxxx Xxxxxx (note: AMI)
CORONA, Xxxxxxxxx Xxxxxx, XX 00000
000 Xxxxx Xxxxxx
XXXXXX, Xxxxxxxxx Xxxxxx, XX 00000
00000 Xxxxxxxxx Xx.
XXXXXXX, Xxxxxxx Xxxxxx, XX 00000
0000 Xxxx 00xx Xx.
XXXXXX, Xxx Xxxxxxx Xxxxxx, XX 000000
0000 Xxxx Xxxxxx
XXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
0000 Xxxxxx Xx.
XXXXXX, Xxxxx Xxxxxx, XX 00000
0000 Xxxx Xxxxxx
XXX XXXXX, Xxxxx Xxxxxx, XX 00000
000 Xxxxxxxxx Xx.
XXXX, Xxxxxx Xxxxxx, XX 00000
13551 X.X. Xxxxxxx (note: Xxxxxxxx Xxxxxxxx)
XXXXXXXXX, Xxxxxxxxx Xxxxxx, XX 00000
000 X.X. X Xx.
XXXXXX XXXX, Xxxxxxxxx Xxxxxx, XX 00000
3130 South 0000 Xxxx
XXXXX XXXX XXXX XXXX, Xxxx Xxxx Xxxxxx, XX
00000
North 0000 Xxxx Xx.
XXXXXXX, Xxxxxxx Xxxxxx, XX 00000
0000 Xxxxxxxxxx Xxxxx, XX
XXXXXXXXXXX, Xxxxxxxxx Xxxxxx, XX 00000
0000 Xxxxxxxxxx Xx. # 000
XXXXXXXXXX, Xxxxxxxxxx Xxxxxx, XX 00000
CANADA
0000 00xx Xxxxxx, Xxxxx 000
XXXXXXX, XX, X0X 0X0, Xxxxxx
00000 Xxxxxx Xxxxx, Xxxxx 000
XXXXXXXX, XX, X0X 0X0, Xxxxxx
0000 Xxxxxxx Xxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
00 Xxxxxxxx Xxxx
XXXXXXXX, XX, X0X 0X0, Xxxxxx
PUBLIC WAREHOUSES OCCASIONALLY
USED:
U.S.:
Desert Empire Transfer & Storage
000 X. Xxxxxxxxxx Xx.
Xxx Xxxxxxxxxx, XX 00000
California Distribution Centers, Inc.
0000 Xxxxxxxxxx Xxxx.
Xxxx Xxxxxxxxxx, XX 00000
Xxxxxx Xxxxxx Cold Storage of California
0000 00xx Xxxxxx
Xxxxxxxxxx, XX 00000
3
SCHEDULE 6
LOCATION OF CHIEF EXECUTIVE OFFICE
GRANTOR LOCATION
------- --------
Core-Xxxx International, Inc. 000 Xxxxxx Xxxxx Xxxxxxxxx #000
Xxxxx Xxx Xxxxxxxxx, XX 00000
C/M Products, Inc. 000 Xxxxxx Xxxxx Xxxxxxxxx #000
Xxxxx Xxx Xxxxxxxxx, XX 00000
Core-Xxxx Interrelated 000 Xxxxxx Xxxxx Xxxxxxxxx #000
Companies, Inc. Xxxxx Xxx Xxxxxxxxx, XX 00000
Core-Xxxx Midcontinent, Inc. 000 Xxxxxx Xxxxx Xxxxxxxxx #000
Xxxxx Xxx Xxxxxxxxx, XX 00000
SCHEDULE 7
DEPOSIT BANKS/CANADA
NAME AND ADDRESS OF BANK ACCOUNT NUMBER
---------------------------- ----------------------------------
BANK OF MONTREAL CANADIAN CASH
FIRST BANK TOWER, 6TH FL COLLATERAL ACCOUNT
000 XXXXXXX XXXXXX 00000-0000-000
XXXXXXXXX, X.X. X0X 0X0 C$ Concentration Acct
ATTN: XXXX XXXXXXXXX
THE BANK OF NOVA SCOTIA DEPOSIT ACCOUNT
000 XXXX XXXXXXX XX. 00XX XX 00000-000-0000-00
XXXXXXXXX, X.X., X0X 0X0 Visa Deposit/Calgary
ATTN: XXXX XXXXXXXX Transfer to Bk Montreal weekly
DEPOSIT ACCOUNT
71480-002-00009-14
Visa Deposit Richmond
Transfer to Bk Montreal weekly
CANADIAN IMPERIAL BANK DEPOSIT ACCOUNT
OF COMMERCE 00307-2604310
0000 XXXXXX XXX. Visa & Master Card Deposit
WINNIPEG, M.B. R3H 0B4 Calgary
Transfer to Bk Montreal weekly
SCHEDULE 7
COLLECTION ACCOUNT AND DEPOSITORY BANKS
(CONTINUED)
NAME AND ADDRESS OF BANK ACCOUNT NUMBER
------------------------- --------------------------------
CHASE MANHATTAN BANK-NEW YORK US CASH COLLATERAL
0 XXXXX XXXXX 000-0-000000
XXX XXXX, XX 00000 Chase Controls
ATTN: XXXXXXX XXXX (SAN FRANCISCO)
L/C COLLATERAL
000-0-000000
Chase Controls
XXXXX XXXXX/XXXXX XXXXXXXXXX XXXXXXXXXX XXXXXXX
XXXX XX XXXXXXX 0000-00000
000 XXXX XXXXX XXXXXX Depository/Corona
MAIL SORT 967
XXXXXXX, XXXXXXX 00000 DEPOSITORY ACCOUNT
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO) 1829-12192
Depository/Las Vegas
XXXXX FARGO/FIRST INTERSTATE COLLECTION ACCOUNT
BANK OF CALIFORNIA 149-643-709
000 XXXXXXXX XXXXXXXXX Sweep account for non-Calif
XXX XXXXXXX, XXXXXXXXXX 00000 ACH activity
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO/FIRST INTERSTATE DEPOSITORY ACCOUNT
BANK OF DENVER 4785940
000 XXXXXXXXXXX XXXXXX Xxxxxxxxxx/Xxxxxx (XXX)
0X-000 Lockbox
XXXXXX, XXXXXXXX 00000
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO/FIRST INTERSTATE DEPOSITORY ACCOUNT
BANK OF NEVADA 147-316-3763
0000 XXXXXX XXXXXX XXXXXXX Depository/Las Vegas
NUMBER 811LV
XXX XXXXX, XXXXXX 00000 DEPOSITORY ACCOUNT
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO) 000-0000-000
Depository/Reno
SCHEDULE 7
COLLECTION ACCOUNT AND DEPOSITORY BANKS
(CONTINUED)
NAME AND ADDRESS OF BANK ACCOUNT NUMBER
------------------------------- --------------------------------
XXXXX FARGO/FIRST INTERSTATE DEPOSITORY ACCOUNT
BANK OF OREGON 000-000000-0
0000 X.X. XXXXX XXXXX Depository/Portland
T-19 Lockbox
XXXXXXXX, XXXXXX 00000
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO) DEPOSITORY ACCOUNT
000-000000-0
Depository/Grants Pass
XXXXX FARGO/FIRST INTERSTATE DEPOSITORY ACCOUNT
BANK OF UTAH 00-00000-0
000 XXXXX XXXX Xxxxxxxxxx/Xxxx Xxxx Xxxx
XXXX XXXX XXXX, XXXX 00000
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO/FIRST INTERSTATE DEPOSITORY ACCOUNT
BANK OF WASHINGTON 300-080-065
000 XXXXX XXXXXX, XXXX XXXXXXX 886 Depository/Spokane
XXXXXXX, XXXXXXXXXX 00000
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO) DEPOSITORY ACCOUNT
000-000-000
Depository/Spokane
SUNWEST BANK COLLECTION ACCOUNT
X.X. XXX 00000 0000000000
XXXXXXXXXXX, XXX XXXXXX 87125 Depository/Albuquerque
XXXXX XXXX
XXXXX FARGO BANK COLLECTION ACCOUNT
000 XXXXXXXXXX XXXXXX 0000-000000
XXX XXXXXXXXX, XX 00000 California Depository/Lockbox
ATTN: XX XXXXXXX Lockbox address
Sacramento dept 44110
Hayward dept 44238
Los Angeles dept 66514
Corona dept 66579
Bakersfield dept 66543
SCHEDULE 8
INSTRUMENTS AND CHATTEL PAPER
1. Series B Bonds issued by Apex Oil Company, Inc. due November 2000 with an
aggregate principal balance of $183,305. No fair market value is
available.
2. Promissory Note of Xxxxxxxx X. Xxxxxxxx, an individual and Xxxxxxxxx
Xxxxxxxx, an individual, doing business as Sunset Shell and Sunset Shell
Food Mart and with an additional debtor of Hindoyan Enterprises, Inc., with
an outstanding balance of $1,118,150 and maturity date of February 1, 1997.
A balloon payment of $1,065,642 is due on February 1, 1997. Substantially
all of the principal is expected to be renegotiated and the maturity date
extended under a new promissory note agreement to be entered into at
maturity.
3. Promissory Note of Xxxxxx Xxxxxxx, an individual doing business as Xxxxxx
Discount Depot with an outstanding balance of $151,703 and maturity date of
June 20, 1996.
SCHEDULE 9
PERMITTED UNBLOCKED ACCOUNTS
(PAGE 1)
NAME AND ADDRESS OF BANK ACCOUNT NUMBER
--------------------------- ---------------
BANK OF MONTREAL 00000-0000-000
FIRST BANK TOWER, 6TH FL. CS Disbursement/ZBA
000 XXXXXXX XXXXXX
XXXXXXXXX, X.X. X0X 0X0 00000-0000-000
C$ Cigarette EFT/ZBA
00000-0000-000
C$ Payroll/ZBA
00000-0000-000
C$ Manual Payroll/ZBA
0000-0000-000
Returned Items/Richmond
0000-0000-000
Returned Items/Calgary
00000-0000-000
US $ Account
0000-0000-000
CAN $ Loan Balance Acct.
CHASE MANHATTAN BANK-NEW YORK 000-0-000000
1 CHASE PLAZA Concentration (disbursement)
XXX XXXX, XX 00000
ATTN: XXXXXXX XXXX (SAN FRANCISCO) 000-0-000000
Cigarette EFT/ZBA
000-0-000000
Non Cigarette EFT/ZBA
000-0-000000
CMI Originated EFT/ZBA
CHASE MANHATTAN BANK-SYRACUSE 000-0-00000
0000 XXXXXXX XX. Accounts payable/checking
XXXXXXXX, XXX XXXX 00000 ZBA
ATTN: XXXXXXX XXXX (SAN FRANCISCO)
CITIBANK-NEW YORK 4064-2251
000 XXXX XXX Xxxxxx Xxxxxxxxxxxx
XXX XXXX, XX 00000
SCHEDULE 9
PERMITTED UNBLOCKED ACCOUNTS
(PAGE 2)
NAME AND ADDRESS OF BANK ACCOUNT NUMBER
------------------------- --------------
CITIBANK-DELAWARE 4002-3661
XXX XXXX'X XXX Xxxxxxxxxxxx Xxxxxxx
XXX XXXXXX, XX 00000
4002-2768
Accounts payable
4002-3733
EDI/EFT
4002-3741
non cig EFT/EDI
3911-1795
CMI initiated EFT/XXX
XXXXX FARGO/FIRST INTERSTATE 000-000-000
BANK OF CALIFORNIA Payroll
000 XXXXXXXX XXXXXXXXX
MAIL SORT W12-17
XXX XXXXXXX, XXXXXXXXXX 00000
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO/FIRST INTERSTATE 0000000
BANK OF DENVER Tradeshow Xxxxx Cash
000 XXXXXXXXXXX XXXXXX
0X-000 5035851
XXXXXX, XXXXXXXX 00000 Xxxxx Cash/Denver
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO/FIRST INTERSTATE 147-018-6965
BANK OF NEVADA Xxxxx Cash/Las Vegas
0000 XXXXXX XXXXXX XXXXXXX
NUMBER 881LV 000-0000-000
XXX XXXXX, XXXXXX 00000 Xxxxx Cash/Reno
ATTN: XX XXXXXXX (XXXXX SAN FRANCISCO)
XXXXX FARGO BANK 4518-110584
000 XXXXXXXXXX XXXXXX Payroll/to replace FIB
XXX XXXXXXXXX, XX. 00000
ATTN: XX XXXXXXX 4518-100110
Xxxxx Cash/Xxxxxx
4518-100292
Xxxxx Cash/Sacramento
4518-100235
Xxxxx Cash/Los Angeles
4518-100177
Xxxxx Cash/Bakersfield
EXHIBIT A-1 TO
SECURITY AGREEMENT
[FORM OF]
DEPOSITORY LETTER
[Addressee]
Re: Account Nos. PER THE ATTACHED SCHEDULE
Core-Xxxx International, Inc. (the "ASSIGNOR") currently maintains
with you (the "DEPOSITORY"), the bank accounts identified in the attached
schedules (the "DEPOSITORY ACCOUNT"). The Assignor hereby irrevocably
notifies and instructs the Depository with respect to the Depository Account
as set forth below, and hereby requests the Depository to indicate its
acceptance of and agreement to be bound by the terms hereof by signing in the
space provided for below.
(1) In order to provide security for certain obligations of the
Assignor under the Credit Agreement dated as of August 7, 1996 (as amended
and in effect from time to time, the "CREDIT AGREEMENT") among the Assignor,
each of the banks and financial institutions parties thereto (the "Lenders")
and The Chase Manhattan Bank, as administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT"), the Assignor has granted to the Administrative Agent
for the benefit of the Lenders a security interest (the "SECURITY INTEREST")
in the Collateral (as defined in the Security Agreement dated as of August 7,
1996 between the Assignor and the Administrative Agent (as amended and in
effect from time to time, the "SECURITY AGREEMENT")), which includes, without
limitation, all of the Assignor's accounts (as such term is defined in the
Uniform Commercial Code (the "UCC")), now owned or hereafter acquired, all
amounts due and to become due under any of the foregoing and all products and
proceeds of any and all of the foregoing.
(2) In connection with the granting of the Security Interest in the
Collateral by the Assignor to the Administrative Agent for the benefit of the
Lenders, the Assignor has granted and transferred to the Administrative Agent
for the benefit of the Lenders a Security Interest in (a) the Depository
Account, (b) all of the items from time to time in the Depository Account (it
being acknowledged that such items constitute proceeds, within the meaning of
the UCC, of the Collateral) and (c) all of the proceeds of such items.
(3) Subject to the further instructions of the Administrative Agent,
the Depository is hereby directed to transfer, at the start of each business
day, in same day funds, all available funds on deposit in the Depository
Account (less any minimum required balances) to Account No.______________
(the "COLLECTION ACCOUNT") maintained at First Interstate Bank (California),
which account has been assigned by Assignor to the Administrative Agent.
(4) The Depository is hereby notified that (i) the Administrative
Agent is authorized and empowered to direct the Depository administering the
Depository Account and any related lockboxes to remit all future payments
directly to other designated accounts maintained by the Administrative Agent
and (ii) the Assignor has agreed that it will not withdraw any funds in the
Depository Account without the prior written consent of the Administrative
Agent. Such direction may be given by the Administrative Agent either in its
own name or as a secured party, or in the name of the Assignor pursuant to an
irrevocable power of attorney (which power is coupled with an interest)
heretofore granted by the Assignor in favor of the Administrative Agent. The
Depository is
2
hereby irrevocably authorized and directed to abide by any such written
direct payment instructions it may receive from the Administrative Agent in
its own name or in the name of the Assignor. Such payment instructions shall
only apply to good, collected funds held in the Depository Account.
(5) By its acceptance hereof and agreement hereto, the Depository
hereby (a) waives, with respect to all its existing and future claims against
the Assignor, or any affiliate thereof, all existing and future rights for
set-off and banker's liens against the Depository Account and all items and
proceeds thereof that come into the possession of the Depository in
connection with the Depository Account; PROVIDED, however, that the
Depository retains the right to charge the Depository Account for all items
deposited in the Depository Account and subsequently returned unpaid to the
Depository and for any unpaid fees and expenses pertaining to the Depository
Account or any related lockboxes; (b) represents and warrants to the best of
its knowledge that except for the Depository Account and any other accounts
disclosed to the Administrative Agent, there are no bank accounts that are
maintained by the Depository with respect to the receivables of the Assignor;
(c) agrees to provide to the Administrative Agent written notice of any fees
and expenses pertaining to the Depository Account or any related lockboxes
that have not been paid by the Assignor and agrees not to discontinue any
services pertaining to the Depository Account or such lockboxes until 30 days
have elapsed from such notice being given by the Depository to the
Administrative Agent and such fees and expenses shall not have been paid; (d)
agrees to provide the Administrative Agent written notice (at The Chase
Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
______________) simultaneously with the notice being given to the Assignor as
required by an agreement, if any, governing the Depository Account, should it
alter, change or discontinue any services pertaining to the Depository
Account or such lockboxes, such alteration, change or discontinuance to be
effective 30 days from such notice being given by the Depository to the
Administrative Agent, or sooner should the Administrative Agent have
consented in writing; (e) agrees that in the event any services pertaining to
the Depository Account or such lockboxes are discontinued after notice by the
Depository as aforesaid, the Depository will (subject to being furnished with
reasonable assurances regarding payment of its related fees and expenses)
comply with the Administrative Agent's reasonable instructions regarding the
forwarding of any payments of items then contained or subsequently deposited
in the Depository Account or delivered to any related lockboxes; (f) agrees
that it shall not, without the prior written consent of the Administrative
Agent, transfer any funds in the Depository Account; and (g) agrees to
provide the Administrative Agent with access to daily balance reporting in
respect of the Depository Account, including any necessary code or password.
(6) The Depository confirms to the best of its knowledge and the
Assignor confirms that true and correct copies of all existing agreements
between the Assignor and the Depository with respect to the Depository
Account or any related lockboxes or otherwise relating to the collection of
receivables of the Assignor are attached.
(7) This Letter Agreement (a) shall be effective as of the date first
above written; (b) shall supersede any other agreement relating to the
assignment of the Depository Account, including any bank account agreement
between the Assignor and the Depository relating to collection of receivables
of the Assignor but only to the extent that such other agreement is
inconsistent with this Letter Agreement; (c) is binding upon the parties and
their respective successors and assigns and shall inure to their benefit; (d)
shall not in any way or to any extent be changed, amended, modified or waived
without the Administrative Agent's and the Depository's prior written
consent; (e) shall be governed by, and interpreted in accordance with, the
laws of the State of New York; and (f) may be executed in any number of
counterparts which together shall constitute one and the same instrument.
Any provision hereof that may prove unenforceable under any law or regulation
shall not affect the validity of any other provision hereof. The execution,
delivery and performance of this Letter
3
Agreement is within the corporate power of each of the Assignor, the
Administrative Agent and the Depository, and has been duly authorized by all
necessary corporate action.
(8) All notices or instructions herein provided for shall be in
writing and shall be deemed to have been given when delivered at or mailed,
postage prepaid, or telecopied, to the intended recipient at the address
specified below its name on the signature pages hereof, except that notices
and communication to the Depository shall not be effective until received by
the Depository.
(9) The undersigned, First Interstate Bank Ltd. ("FIB"), has
represented and warranted to the Administrative Agent that it is authorized
to sign on behalf of the Depository. By signing in the space provided for
below, FIB shall effectively bind the Depository to the instructions provided
for herein.
Very truly yours,
CORE-XXXX INTERNATIONAL, INC.
By: ________________________________
Name:
Title:
Address:
ACCEPTED AND AGREED
AS AFORESAID:
[Name of Depository]
By:___________________________
Name:
Title:
Address:
THE CHASE MANHATTAN BANK
As Administrative Agent
By:
Name:
Title:
Address:
EXHIBIT A-2-A TO
SECURITY AGREEMENT
[FORM OF]
DEPOSIT ACCOUNT LETTER
FOR CANADIAN CASH
COLLATERAL ACCOUNT
[Addressee]
Re: Account No.______________
Core-Xxxx International, Inc. (the "ASSIGNOR") currently maintains
with you (the "DEPOSITORY"), the bank account identified by the
above-referenced account number (the "DEPOSIT ACCOUNT"). The Assignor hereby
irrevocably notifies and instructs the Depository with respect to the Deposit
Account as set forth below, and hereby requests the Depository to indicate
its acceptance of and agreement to be bound by the terms hereof by signing in
the space provided for below.
(1) In order to provide security for certain obligations of the
Assignor under the Credit Agreement dated as of August 7, 1996 (as amended
and in effect from time to time, the "CREDIT AGREEMENT") among the Assignor,
each of the banks and financial institutions parties thereto (the "Lenders")
and The Chase Manhattan Bank, as administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT"), the Assignor has granted to the Administrative Agent
for the benefit of the Lenders a security interest (the "SECURITY INTEREST")
in the Collateral (as defined in the Security Agreement dated as of August 7,
1996 between the Assignor and the Administrative Agent (as amended and in
effect from time to time, the "SECURITY AGREEMENT")), which includes, without
limitation, all of the Assignor's accounts (as such term is defined in the
Uniform Commercial Code (the "UCC")), now owned or hereafter acquired, all
amounts due and to become due under any of the foregoing and all products and
proceeds of any and all of the foregoing.
(2) In connection with the granting of the Security Interest in the
Collateral by the Assignor to the Administrative Agent for the benefit of the
Lenders, the Assignor has granted and transferred to the Administrative Agent
for the benefit of the Lenders a Security Interest in (a) the Deposit
Account, (b) all of the items from time to time in the Deposit Account, (c)
all investments made from amounts on deposit in the Deposit Account in term
deposits and interest paid on such investments in term deposits and (d) all
of the proceeds of such items.
(3) The Depository is hereby notified that (i) the Administrative
Agent is authorized and empowered to direct the Depository administering the
Deposit Account to remit all future payments directly to the Administrative
Agent. Such direction may be given by the Administrative Agent either in its
own name or as a secured party, or in the name of the Assignor pursuant to an
irrevocable power of attorney (which power is coupled with an interest)
heretofore granted by the Assignor in favor of the Administrative Agent. The
Depository is hereby irrevocably authorized and directed to abide by any such
written direct payment instructions it may receive from the Administrative
Agent in its own name or in the name of the Assignor. Such payment
instructions shall only apply to good, collected funds held in the Deposit
Account.
(4) By its acceptance hereof and agreement hereto, the Depository
hereby (a) waives, with respect to all its existing and future claims against
the Assignor, or any affiliate thereof,
2
all existing and future rights for set-off and banker's liens against the
Deposit Account and all items and proceeds thereof that come into the
possession of the Depository in connection with the Deposit Account;
PROVIDED, however, that the Depository retains the right to charge the
Deposit Account for all items deposited in the Deposit Account and
subsequently returned unpaid to the Depository and for any unpaid fees and
expenses pertaining to the Deposit Account; (b) represents and warrants to
the best of its knowledge that except for the Deposit Account and any other
accounts disclosed to the Administrative Agent, there are no bank accounts
that are maintained by the Depository with respect to the receivables of the
Assignor; (c) agrees to provide to the Administrative Agent written notice of
any fees and expenses pertaining to the Deposit Account that have not been
paid by the Assignor and agrees not to discontinue any services pertaining to
the Deposit Account until 30 days have elapsed from such notice being given
by the Depository to the Administrative Agent and such fees and expenses
shall not have been paid; (d) agrees to provide the Administrative Agent
written notice (at The Chase Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX
00000, Attention: ______________) simultaneously with the notice being given
to the Assignor as required by an agreement, if any, governing the Deposit
Account, should it alter, change or discontinue any services pertaining to
the Deposit Account, such alteration, change or discontinuance to be
effective 30 days from such notice being given by the Depository to the
Administrative Agent, or sooner should the Administrative Agent have
consented in writing; (e) agrees that in the event any services pertaining to
the Deposit Account are discontinued after notice by the Depository as
aforesaid, the Depository will (subject to being furnished with reasonable
assurances regarding payment of its related fees and expenses) comply with
the Administrative Agent's reasonable instructions regarding the forwarding
of any payments of items then contained or subsequently deposited in the
Deposit Account; and (f) agrees to provide the Administrative Agent with
access to daily balance reporting in respect of the Deposit Account,
including any necessary code or password.
(5) The Depository confirms to the best of its knowledge and the
Assignor confirms that true and correct copies of all existing agreements
between the Assignor and the Depository with respect to the Deposit Account
or otherwise relating to the collection of receivables of the Assignor are
attached.
(6) This Letter Agreement (a) shall be effective as of the date first
above written; (b) shall supersede any other agreement relating to the
assignment of the Deposit Account, including any bank account agreement
between the Assignor and the Depository relating to collection of receivables
of the Assignor but only to the extent that such other agreement is
inconsistent with this Letter Agreement; (c) is binding upon the parties and
their respective successors and assigns and shall inure to their benefit; (d)
shall not in any way or to any extent be changed, amended, modified or waived
without the Administrative Agent's and the Depository's prior written
consent; (e) shall be governed by, and interpreted in accordance with, the
laws of the State of New York; and (f) may be executed in any number of
counterparts which together shall constitute one and the same instrument.
Any provision hereof that may prove unenforceable under any law or regulation
shall not affect the validity of any other provision hereof. The execution,
delivery and performance of this Letter Agreement is within the corporate
power of each of the Assignor, the Administrative Agent and the Depository,
and has been duly authorized by all necessary corporate action.
3
(7) All notices or instructions herein provided for shall be in
writing and shall be deemed to have been given when delivered at or mailed,
postage prepaid, or telecopied, to the intended recipient at the address
specified below its name on the signature pages hereof, except that notices
and communication to the Depository shall not be effective until received by
the Depository.
Very truly yours,
CORE-XXXX INTERNATIONAL, INC.
By: ____________________________________
Name:
Title:
Address:
ACCEPTED AND AGREED
AS AFORESAID:
[Name of Depository]
By: ___________________________
Name:
Title:
Address:
THE CHASE MANHATTAN BANK
As Administrative Agent
By: ___________________________
Name:
Title:
Address:
EXHIBIT A-2-B TO
SECURITY AGREEMENT
[FORM OF]
DEPOSIT ACCOUNT LETTER
[Addressee]
Re: Account No.______________
Core-Xxxx International, Inc. (the "ASSIGNOR") currently maintains
with you (the "DEPOSITORY"), the bank account identified by the
above-referenced account number (the "DEPOSIT ACCOUNT"). The Assignor hereby
irrevocably notifies and instructs the Depository with respect to the Deposit
Account as set forth below, and hereby requests the Depository to indicate
its acceptance of and agreement to be bound by the terms hereof by signing in
the space provided for below.
(1) In order to provide security for certain obligations of the
Assignor under the Credit Agreement dated as of August 7, 1996 (as amended
and in effect from time to time, the "CREDIT AGREEMENT") among the Assignor,
each of the banks and financial institutions parties thereto (the "Lenders")
and The Chase Manhattan Bank, as administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT"), the Assignor has granted to the Administrative Agent
for the benefit of the Lenders a security interest (the "SECURITY INTEREST")
in the Collateral (as defined in the Security Agreement dated as of August 7,
1996 between the Assignor and the Administrative Agent (as amended and in
effect from time to time, the "SECURITY AGREEMENT")), which includes, without
limitation, all of the Assignor's accounts (as such term is defined in the
Uniform Commercial Code (the "UCC")), now owned or hereafter acquired, all
amounts due and to become due under any of the foregoing and all products and
proceeds of any and all of the foregoing.
(2) In connection with the granting of the Security Interest in the
Collateral by the Assignor to the Administrative Agent for the benefit of the
Lenders, the Assignor has granted and transferred to the Administrative Agent
for the benefit of the Lenders a Security Interest in (a) the Deposit
Account, (b) all of the items from time to time in the Deposit Account and
(c) all of the proceeds of such items.
(3) Subject to the further instructions of the Administrative Agent,
the Depository is hereby authorized, upon the request of Bank of Montreal to
transfer, at least once a week, in same day funds, all available funds on
deposit in the Deposit Account (less any minimum required balances) to
Account No.______________ (the "CANADIAN CASH COLLATERAL ACCOUNT") maintained
at Bank of Montreal.
(4) The Depository is hereby notified that the Administrative Agent
is authorized and empowered to direct the Depository administering the
Deposit Account and any related lockboxes to remit all future payments
directly to other designated accounts maintained by the Administrative Agent.
Such direction may be given by the Administrative Agent either in its own
name or as a secured party, or in the name of the Assignor pursuant to an
irrevocable power of attorney (which power is coupled with an interest)
heretofore granted by the Assignor in favor of the Administrative Agent. The
Depository is hereby irrevocably authorized and directed to abide by any such
written direct payment instructions it may receive from the Administrative
Agent in its own name or in the
2
name of the Assignor. Such payment instructions shall only apply to good,
collected funds held in the Deposit Account.
(5) By its acceptance hereof and agreement hereto, the Depository
hereby (a) waives, with respect to all its existing and future claims against
the Assignor, or any affiliate thereof, all existing and future rights for
set-off and banker's liens against the Deposit Account and all items and
proceeds thereof that come into the possession of the Depository in
connection with the Deposit Account; PROVIDED, however, that the Depository
retains the right to charge the Deposit Account for all items deposited in
the Deposit Account and subsequently returned unpaid to the Depository and
for any unpaid fees and expenses pertaining to the Deposit Account; (b)
represents and warrants to the best of its knowledge that except for the
Deposit Account and any other accounts disclosed to the Administrative Agent,
there are no bank accounts that are maintained by the Depository with respect
to the receivables of the Assignor; (c) agrees to provide to the
Administrative Agent written notice of any fees and expenses pertaining to
the Deposit Account that have not been paid by the Assignor and agrees not to
discontinue any services pertaining to the Deposit Account until 30 days have
elapsed from such notice being given by the Depository to the Administrative
Agent and such fees and expenses shall not have been paid; (d) agrees to
provide the Administrative Agent written notice (at The Chase Manhattan Bank,
000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: ______________)
simultaneously with the notice being given to the Assignor as required by an
agreement, if any, governing the Deposit Account, should it alter, change or
discontinue any services pertaining to the Deposit Account such alteration,
change or discontinuance to be effective 30 days from such notice being given
by the Depository to the Administrative Agent, or sooner should the
Administrative Agent have consented in writing; (e) agrees that in the event
any services pertaining to the Deposit Account are discontinued after notice
by the Depository as aforesaid, the Depository will (subject to being
furnished with reasonable assurances regarding payment of its related fees
and expenses) comply with the Administrative Agent's reasonable instructions
regarding the forwarding of any payments of items then contained or
subsequently deposited in the Deposit Account; (f) agrees that it shall not,
without the prior written consent of the Administrative Agent, transfer any
funds in the Deposit Account, except as provided in paragraph (3) above; and
(g) agrees to provide the Administrative Agent with access to daily balance
reporting in respect of the Deposit Account, including any necessary code or
password.
(6) The Depository confirms to the best of its knowledge and the
Assignor confirms that true and correct copies of all existing agreements
between the Assignor and the Depository with respect to the Deposit Account
or otherwise relating to the collection of receivables of the Assignor are
attached.
(7) This Letter Agreement (a) shall be effective as of the date first
above written; (b) shall supersede any other agreement relating to the
assignment of the Deposit Account, including any bank account agreement
between the Assignor and the Depository relating to collection of receivables
of the Assignor but only to the extent that such other agreement is
inconsistent with this Letter Agreement; (c) is binding upon the parties and
their respective successors and assigns and shall inure to their benefit; (d)
shall not in any way or to any extent be changed, amended, modified or waived
without the Administrative Agent's and the Depository's prior written
consent; (e) shall be governed by, and interpreted in accordance with, the
laws of the State of New York; and (f) may be executed in any number of
counterparts which together shall constitute one and the same instrument.
Any provision hereof that may prove unenforceable under any law or regulation
shall not affect the validity of any other provision hereof. The execution,
delivery and performance of this Letter Agreement is within the corporate
power of each of the Assignor, the Administrative Agent and the Depository,
and has been duly authorized by all necessary corporate action.
3
(8) All notices or instructions herein provided for shall be in
writing and shall be deemed to have been given when delivered at or mailed,
postage prepaid, or telecopied, to the intended recipient at the address
specified below its name on the signature pages hereof, except that notices
and communication to the Depository shall not be effective until received by
the Depository.
Very truly yours,
CORE-XXXX INTERNATIONAL, INC.
By: ___________________________________
Name:
Title:
Address:
ACCEPTED AND AGREED
AS AFORESAID:
[Name of Depository]
By: __________________________
Name:
Title:
Address:
THE CHASE MANHATTAN BANK
As Administrative Agent
By: __________________________
Name:
Title:
Address:
EXHIBIT A-3 TO
SECURITY AGREEMENT
[FORM OF]
COLLECTION ACCOUNT LETTER
[Addressee]
Re: Account No.______________
Core-Xxxx International, Inc. (the "ASSIGNOR") currently maintains
with you (the "DEPOSITORY"), the bank account identified by the
above-referenced account number (the "COLLECTION ACCOUNT"). The Assignor
hereby irrevocably notifies and instructs the Depository with respect to the
Collection Account as set forth below, and hereby requests the Depository to
indicate its acceptance of and agreement to be bound by the terms hereof by
signing in the space provided for below.
(1) In order to provide security for certain obligations of the
Assignor under the Credit Agreement dated as of August 7, 1996 (as amended
and in effect from time to time, the "CREDIT AGREEMENT") among the Assignor,
each of the banks and financial institutions parties thereto (the "Lenders")
and The Chase Manhattan Bank, as administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT"), the Assignor has granted to the Administrative Agent
for the benefit of the Lenders a security interest (the "SECURITY INTEREST")
in the Collateral (as defined in the Security Agreement dated as of August 7,
1996 between the Assignor and the Administrative Agent (as amended and in
effect from time to time, the "SECURITY AGREEMENT")), which includes, without
limitation, all of the Assignor's accounts (as such term is defined in the
Uniform Commercial Code (the "UCC")), now owned or hereafter acquired, all
amounts due and to become due under any of the foregoing and all products and
proceeds of any and all of the foregoing.
(2) In connection with the granting of the Security Interest in the
Collateral by the Assignor to the Administrative Agent for the benefit of the
Lenders, the Assignor has granted and transferred to the Administrative Agent
for the benefit of the Lenders a Security Interest in (a) the Collection
Account, (b) all of the items from time to time in the Collection Account (it
being acknowledged that such items constitute proceeds, within the meaning of
the UCC, of the Collateral) and (c) all of the proceeds of such items.
(3) Subject to the further instructions of the Administrative Agent,
the Assignor is hereby directed to transfer, at the start of each business
day, in same day funds, all available funds on deposit in the Collection
Account (less any minimum required balances) to Account No.______________
(the "US COLLATERAL ACCOUNT") maintained by the Administrative Agent, but in
no event shall such funds be transferred to an account other than an account
maintained by the Administrative Agent.
(4) The Depository is hereby notified that (i) the Administrative
Agent is authorized and empowered to direct the Depository administering the
Collection Account and any related lockboxes to remit all future payments
directly to other designated accounts maintained by the Administrative Agent
and (ii) the Assignor has agreed that it will not withdraw any funds in the
Collection Account without the prior written consent of the Administrative
Agent. Such direction may be given by the Administrative Agent either in its
own name or as a secured party, or in the name of the Assignor pursuant to an
irrevocable power of attorney (which power is coupled with an interest)
heretofore granted by the Assignor in favor of the Administrative Agent. The
Depository is hereby irrevocably authorized and directed to abide by any such
written direct payment instructions it may
2
receive from the Administrative Agent in its own name or in the name of the
Assignor. Such payment instructions shall only apply to good, collected
funds held in the Collection Account.
(5) By its acceptance hereof and agreement hereto, the Depository
hereby (a) waives, with respect to all its existing and future claims against
the Assignor, or any affiliate thereof, all existing and future rights for
set-off and banker's liens against the Collection Account and all items and
proceeds thereof that come into the possession of the Depository in
connection with the Collection Account; PROVIDED, however, that the
Depository retains the right to charge the Collection Account for all items
deposited in the Collection Account and subsequently returned unpaid to the
Depository and for any unpaid fees and expenses pertaining to the Collection
Account or any related lockboxes; (b) represents and warrants to the best of
its knowledge that except for the Collection Account and any other accounts
disclosed to the Administrative Agent, there are no bank accounts that are
maintained by the Depository with respect to the receivables of the Assignor;
(c) agrees to provide to the Administrative Agent written notice of any fees
and expenses pertaining to the Collection Account or any related lockboxes
that have not been paid by the Assignor and agrees not to discontinue any
services pertaining to the Collection Account or such lockboxes until 30 days
have elapsed from such notice being given by the Depository to the
Administrative Agent and such fees and expenses shall not have been paid; (d)
agrees to provide the Administrative Agent written notice (at The Chase
Manhattan Bank, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
______________) simultaneously with the notice being given to Assignor as
required by an agreement, if any, governing the Collection Account, should it
alter, change or discontinue any services pertaining to the Collection
Account or such lockboxes, such alteration, change or discontinuance to be
effective 30 days from such notice being given by the Depository to the
Administrative Agent, or sooner should the Administrative Agent have
consented in writing; (e) agrees that in the event any services pertaining to
the Collection Account or such lockboxes are discontinued after notice by the
Depository as aforesaid, the Depository will (subject to being furnished with
reasonable assurances regarding payment of its related fees and expenses)
comply with the Administrative Agent's reasonable instructions regarding the
forwarding of any payments of items then contained or subsequently deposited
in the Collection Account or delivered to any related lockboxes; (f) agrees
that it shall not, without the prior written consent of the Administrative
Agent, transfer any funds in the Collection Account; and (g) agrees to
provide the Administrative Agent with access to daily balance reporting in
respect of the Collection Account, including any necessary code or password.
(6) The Depository confirms to the best of its knowledge and the
Assignor confirms that true and correct copies of all existing agreements
between the Assignor and the Depository with respect to the Collection
Account or any related lockboxes or otherwise relating to the collection of
receivables of the Assignor are attached.
(7) This Letter Agreement (a) shall be effective as of the date first
above written; (b) shall supersede any other agreement relating to the
assignment of the Collection Account, including any bank account agreement
between the Assignor and the Depository relating to collection of receivables
of the Assignor but only to the extent that such other agreement is
inconsistent with this Letter Agreement; (c) is binding upon the parties and
their respective successors and assigns and shall inure to their benefit; (d)
shall not in any way or to any extent be changed, amended, modified or waived
without the Administrative Agent's and the Depository's prior written
consent; (e) shall be governed by, and interpreted in accordance with, the
laws of the State of New York; and (f) may be executed in any number of
counterparts which together shall constitute one and the same instrument.
Any provision hereof that may prove unenforceable under any law or regulation
shall not affect the validity of any other provision hereof. The execution,
delivery and performance of this Letter
3
Agreement is within the corporate power of each of the Assignor, the
Administrative Agent and the Depository, and has been duly authorized by all
necessary corporate action.
(8) All notices or instructions herein provided for shall be in
writing and shall be deemed to have been given when delivered at or mailed,
postage prepaid, or telecopied, to the intended recipient at the address
specified below its name on the signature pages hereof, except that notices
and communication to the Depository shall not be effective until received by
the Depository.
Very truly yours,
CORE-XXXX INTERNATIONAL, INC.
By: _________________________________
Name:
Title:
Address:
ACCEPTED AND AGREED
AS AFORESAID:
[Name of Depository]
By: _________________________
Name:
Title:
Address:
THE CHASE MANHATTAN BANK
As Administrative Agent
By: _________________________
Name:
Title:
Address:
EXHIBIT D
TO CREDIT AGREEMENT
[FORM OF]
BORROWER STOCK PLEDGE AGREEMENT
BORROWER STOCK PLEDGE AGREEMENT, dated as of August 7, 1996, made
by CORE-XXXX INTERNATIONAL, INC., a Delaware corporation (the "BORROWER"), in
favor of THE CHASE MANHATTAN BANK, as Administrative Agent (in such capacity,
the "ADMINISTRATIVE AGENT") for the Lenders parties to the Credit Agreement,
dated as of August 7, 1996 (as amended, supplemented or otherwise modified
from time to time, the "CREDIT AGREEMENT"), among the Borrower, the
Administrative Agent and such Lenders.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to and issue or participate in Letters of Credit for the
account of, the Borrower upon the terms and subject to the conditions set forth
therein;
WHEREAS, the Borrower is the legal and beneficial owner of the shares of
Pledged Stock (as hereinafter defined) issued by the Issuers (as hereinafter
defined); and
WHEREAS, it is a condition precedent to the obligation of the Lenders to
make their respective Loans and other extensions of credit to the Borrower
under the Credit Agreement that the Borrower shall have executed and
delivered this Borrower Stock Pledge Agreement to the Administrative Agent
for the ratable benefit of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and
to induce the Lenders to make their respective Loans and other extensions of
credit under the Credit Agreement, the Borrower hereby agrees with the
Administrative Agent, for the ratable benefit of the Lenders, as follows:
1. DEFINED TERMS. (a) Unless otherwise defined herein, terms defined in
the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement.
(b) The following terms shall have the following meanings:
"AGREEMENT": this Borrower Stock Pledge Agreement, as the same may be
amended, modified or otherwise supplemented from time to time.
2
"CODE": the Uniform Commercial Code from time to time in effect in the
State of New York.
"COLLATERAL": the Pledged Stock and all Proceeds.
"COLLATERAL ACCOUNT": any account established to hold money Proceeds,
maintained under the sole dominion and control of the Administrative Agent,
subject to withdrawal by the Administrative Agent for the account of the
Lenders only as provided in subsection .
"ISSUERS": the collective reference to the companies identified on
SCHEDULE 1 attached hereto as the issuers of the Pledged Stock; individually,
each an "ISSUER."
"OBLIGATIONS": the collective reference to the unpaid principal of and
interest on the Notes and all other obligations and liabilities of the
Borrower to the Administrative Agent and the Lenders (including, without
limitation, interest accruing at the then applicable rate provided in the
Credit Agreement after the maturity of the Loans and interest accruing at the
then applicable rate provided in the Credit Agreement after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization
or like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in
connection with, the Credit Agreement, the Notes, this Agreement, the other
Loan Documents or any other document made, delivered or given in connection
therewith, in each case whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses or otherwise
(including, without limitation, all fees and disbursements of counsel to the
Administrative Agent or to the Lenders that are required to be paid by the
Borrower pursuant to the terms of the Credit Agreement or this Agreement or
any other Loan Document).
"PLEDGED STOCK": the shares of capital stock listed on SCHEDULE 1
hereto, together with all stock certificates, options or rights of any nature
whatsoever that may be issued or granted by any Issuer to the Borrower in
respect of the Pledged Stock while this Agreement is in effect.
"PROCEEDS": all "proceeds" as such term is defined in Section 9-306(1)
of the Uniform Commercial Code in effect in the State of New York on the date
hereof and, in any event, shall include, without limitation, all dividends or
other income from the Pledged Stock, collections thereon or distributions
with respect thereto.
"SECURITIES ACT": the Securities Act of 1933, as amended.
(c) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and section and subsection
references are to this Agreement unless otherwise specified.
3
(d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. PLEDGE; GRANT OF SECURITY INTEREST. The Borrower hereby delivers to
the Administrative Agent, for the ratable benefit of the Lenders, all the
Pledged Stock and hereby grants to the Administrative Agent, for the ratable
benefit of the Lenders, a first priority security interest in the Collateral,
as collateral security for the prompt and complete payment and performance
when due (whether at the stated maturity, by acceleration or otherwise) of
the Obligations.
3. STOCK POWERS. Concurrently with the delivery to the Administrative
Agent of each certificate representing one or more shares of Pledged Stock to
the Administrative Agent, the Borrower shall deliver an undated stock power
covering such certificate, duly executed in blank by the Borrower.
4. REPRESENTATIONS AND WARRANTIES. The Borrower represents and
warrants that:
(a) The shares of Pledged Stock constitute all the issued and
outstanding shares of all classes of the capital stock of each Issuer.
(b) All the shares of the Pledged Stock have been duly and validly
issued and are fully paid and nonassessable.
(c) The Borrower is the record and beneficial owner of, and has good
and marketable title to, the Pledged Stock, free of any and all Liens or
options in favor of, or claims of, any other Person, except the security
interest created by this Agreement.
(d) Upon delivery to the Administrative Agent of the stock certificates
evidencing the Pledged Stock (and assuming the Administrative Agent maintains
possession of the same), the security interest created by this Agreement will
constitute a valid, perfected first priority security interest in the
Collateral, enforceable in accordance with its terms as such against all
creditors of the Borrower and any Persons purporting to purchase any
Collateral from the Borrower, except as affected by bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
5. COVENANTS. The Borrower covenants and agrees with the
Administrative Agent and the Lenders that, from and after the date of this
Agreement until this Agreement is terminated and the security interests
created hereby are released:
(a) If the Borrower shall, as a result of its ownership of the Pledged
Stock, become entitled to receive or shall receive any stock certificate
(including, without limitation, any certificate representing a stock dividend
or a distribution in connection with any
4
reclassification, increase or reduction of capital or any certificate issued
in connection with any reorganization), option or rights, whether in addition
to, in substitution of, as a conversion of, or in exchange for any shares of
the Pledged Stock, or otherwise in respect thereof, the Borrower shall accept
the same as the agent of the Administrative Agent and the Lenders, hold the
same in trust for the benefit of the Administrative Agent and the Lenders and
deliver the same forthwith to the Administrative Agent in the exact form
received, duly endorsed by the Borrower to the Administrative Agent, if
required, together with an undated stock power covering such certificate duly
executed in blank by the Borrower and with, if the Administrative Agent so
requests, signature guaranteed, to be held by the Administrative Agent,
subject to the terms hereof, as additional collateral security for the
Obligations. In case any distribution of capital shall be made on or in
respect of the Pledged Stock or any property shall be distributed upon or
with respect to the Pledged Stock pursuant to the recapitalization or
reclassification of the capital of any Issuer or pursuant to the
reorganization thereof, the property so distributed shall be delivered to the
Administrative Agent to be held by it hereunder as additional collateral
security for the Obligations. If any sums of money or property so paid or
distributed in respect of the Pledged Stock shall be received by the Borrower
and required to be paid to the Administrative Agent, the Borrower shall,
until such money or property is paid or delivered to the Administrative
Agent, hold such money or property in trust for the benefit of the Lenders,
segregated from other funds of the Borrower, as additional collateral
security for the Obligations.
(b) Unless otherwise permitted under the Credit Agreement, without the
prior written consent of the Administrative Agent, the Borrower will not (1)
vote to enable, or take any other action to permit, any Issuer to issue any
stock or other equity securities of any nature or to issue any other
securities convertible into or granting the right to purchase or exchange for
any stock or other equity securities of any nature of any Issuer, (2) sell,
assign, transfer, exchange, or otherwise dispose of, or grant any option with
respect to, the Collateral, (3) create, incur or permit to exist any Lien or
option in favor of, or any claim of any Person with respect to, any of the
Collateral, or any interest therein, except for the security interests
created by this Agreement or (4) enter into any agreement or undertaking
restricting the right or ability of the Borrower or the Administrative Agent
to sell, assign or transfer any of the Collateral.
(c) The Borrower shall maintain the security interest created by this
Agreement as a first priority, perfected security interest and shall defend
such security interest against claims and demands of all Persons whomsoever.
At any time and from time to time, upon the written request of the
Administrative Agent, and at the sole expense of the Borrower, the Borrower
will promptly and duly execute and deliver such further instruments and
documents and take such further actions as the Administrative Agent may
reasonably request for the purposes of obtaining or preserving the full
benefits of this Agreement and of the rights and powers herein granted. If
any amount payable under or in connection with any of the Collateral shall be
or become evidenced by any promissory note, other instrument or chattel
paper, such note, instrument or chattel paper shall be immediately delivered
to the
5
Administrative Agent, duly endorsed in a manner reasonably satisfactory to
the Administrative Agent, to be held as Collateral pursuant to this Agreement.
(d) The Borrower shall pay, and save the Administrative Agent and the
Lenders harmless from, any and all liabilities with respect to, or resulting
from any delay in paying, any and all stamp, excise, sales or other like
taxes which may be payable or determined to be payable with respect to any of
the Collateral or in connection with any of the transactions contemplated by
this Agreement.
6. CASH DIVIDENDS; VOTING RIGHTS. Unless an Event of Default shall
have occurred and be continuing and the Administrative Agent shall have given
notice to the Borrower of the Administrative Agent's intent to exercise its
corresponding rights pursuant to Section below, the Borrower shall be
permitted to receive all cash dividends paid in the normal course of business
of the Issuers and consistent with past practice, to the extent permitted in
the Credit Agreement, in respect of the Pledged Stock and to exercise all
voting and corporate rights with respect to the Pledged Stock; PROVIDED,
HOWEVER, that no vote shall be cast or corporate right exercised or other
action taken which, in the Administrative Agent's reasonable judgment, would
impair the Collateral in a manner inconsistent with the Credit Agreement or
which would be inconsistent with or result in any violation of any provision
of the Credit Agreement, the Notes, this Agreement or any other Loan Document.
7. RIGHTS OF THE LENDERS AND THE ADMINISTRATIVE AGENT. (a) All money
Proceeds received by the Administrative Agent hereunder shall be held by the
Administrative Agent for the benefit of the Lenders in a Collateral Account.
All Proceeds while held by the Administrative Agent in a Collateral Account
(or by the Borrower in trust for the benefit of the Administrative Agent and
the Lenders) shall continue to be held as collateral security for all the
Obligations and shall not constitute payment thereof until applied as
provided in subsection 8(a).
(b) If an Event of Default shall occur and be continuing and the
Administrative Agent shall give notice of its intent to exercise its rights,
as specified below, to the Borrower, (1) the Administrative Agent shall have
the right to receive any and all cash dividends paid in respect of the
Pledged Stock and make application thereof to the Obligations in such order
as the Administrative Agent may determine, and (2) all shares of the Pledged
Stock shall be registered in the name of the Administrative Agent or its
nominee, and the Administrative Agent or its nominee may thereafter exercise
(A) all voting, corporate and other rights pertaining to such shares of the
Pledged Stock at any meeting of shareholders of any Issuer or otherwise and
(B) any and all rights of conversion, exchange, subscription and any other
rights, privileges or options pertaining to such shares of the Pledged Stock
as if it were the absolute owner thereof (including, without limitation, the
right to exchange at its discretion any and all of the Pledged Stock upon the
merger, consolidation, reorganization, recapitalization or other fundamental
change in the corporate structure of any Issuer, or upon the exercise by the
Borrower or the Administrative Agent of any right, privilege or option
pertaining to such shares of the Pledged Stock, and in connection therewith,
the right to
6
deposit and deliver any and all of the Pledged Stock with any committee,
depositary, transfer agent, registrar or other designated agency upon such
terms and conditions as the Administrative Agent may determine), all without
liability except to account for property actually received by it, but the
Administrative Agent shall have no duty to the Borrower to exercise any such
right, privilege or option and shall not be responsible for any failure to do
so or delay in so doing.
8. REMEDIES. (a) If an Event of Default shall have occurred and be
continuing, at any time at the Administrative Agent's election, the
Administrative Agent may apply all or any part of Proceeds held in any
Collateral Account in payment of the Obligations in such order as the
Administrative Agent may elect.
(b) If an Event of Default shall have occurred and be continuing, the
Administrative Agent, on behalf of the Lenders, may exercise, in addition to
all other rights and remedies granted in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Obligations,
all rights and remedies of a secured party under the Code. Without limiting
the generality of the foregoing, the Administrative Agent, without demand of
performance or other demand, presentment, protest, advertisement or notice of
any kind (except any notice required by law referred to below) to or upon the
Borrower or any other Person (all and each of which demands, defenses,
advertisements and notices are hereby waived), may in such circumstances
forthwith collect, receive, appropriate and realize upon the Collateral, or
any part thereof, and/or may forthwith sell, assign, give an option or
options to purchase or otherwise dispose of and deliver the Collateral or any
part thereof (or contract to do any of the foregoing), in one or more parcels
at public or private sale or sales, in the over-the-counter market, at any
exchange, broker's board or office of the Administrative Agent or any Lender
or elsewhere upon such terms and conditions as it may deem advisable and at
such prices as it may deem best, for cash or on credit or for future delivery
without assumption of any credit risk. The Administrative Agent or any
Lender shall have the right upon any such public sale or sales, and, to the
extent permitted by law, upon any such private sale or sales, to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption in the Borrower, which right or equity is hereby waived or
released. The Administrative Agent shall apply any Proceeds from time to
time held by it and the net proceeds of any such collection, recovery,
receipt, appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred in respect thereof or incidental to
the care or safekeeping of any of the Collateral or in any way relating to
the Collateral or the rights of the Administrative Agent and the Lenders
hereunder, including, without limitation, reasonable attorneys' fees and
disbursements of counsel to the Administrative Agent, to the payment in whole
or in part of the Obligations, in such order as the Administrative Agent may
elect, and only after such application and after the payment by the
Administrative Agent of any other amount required by any provision of law,
including, without limitation, Section 9-504(1)(c) of the Code, need the
Administrative Agent account for the surplus, if any, to the Borrower. To
the extent permitted by applicable law, the Borrower waives all claims,
damages and demands it may acquire against the Administrative Agent or any
Lender arising out of the exercise by them of any rights hereunder, except, in
7
the case of the Administrative Agent or any Lender, to the extent of any
gross negligence or willful misconduct on the part of the Administrative
Agent or such Lender, as the case may be. If any notice of a proposed sale
or other disposition of Collateral shall be required by law, such notice
shall be deemed reasonable and proper if given at least 10 days before such
sale or other disposition. The Borrower shall remain liable for any
deficiency if the proceeds of any sale or other disposition of Collateral are
insufficient to pay the Obligations and the reasonable fees and disbursements
of any attorneys employed by the Administrative Agent or any Lender to
collect such deficiency.
9. REGISTRATION RIGHTS; PRIVATE SALES. (a) If the Administrative
Agent shall determine to exercise its right to sell any or all of the Pledged
Stock pursuant to Section hereof, and if in the opinion of the
Administrative Agent it is necessary or advisable to have the Pledged Stock,
or that portion thereof to be sold, registered under the provisions of the
Securities Act, the Borrower will cause the Issuer thereof to (1) execute and
deliver, and cause the directors and officers of such Issuer to execute and
deliver, all such instruments and documents, and do or cause to be done all
such other acts as may be, in the opinion of the Administrative Agent,
necessary or advisable to register the Pledged Stock, or that portion thereof
to be sold, under the provisions of the Securities Act, (2) to use its best
efforts to cause the registration statement relating thereto to become
effective and to remain effective for a period of one year from the date of
the first public offering of the Pledged Stock, or that portion thereof to be
sold, and (3) to make all amendments thereto and/or to the related prospectus
which, in the opinion of the Administrative Agent, are necessary or
advisable, all in conformity with the requirements of the Securities Act and
the rules and regulations of the Securities and Exchange Commission
applicable thereto. The Borrower agrees to cause such Issuer to comply with
the provisions of the securities or "Blue Sky" laws of any and all
jurisdictions which the Administrative Agent shall designate and to make
available to its security holders, as soon as practicable, an earnings
statement (which need not be audited) which will satisfy the provisions of
Section 11(a) of the Securities Act.
(b) The Borrower recognizes that the Administrative Agent may be unable
to effect a public sale of any or all the Pledged Stock, by reason of certain
prohibitions contained in the Securities Act and applicable state securities
laws or otherwise, and may be compelled to resort to one or more private
sales thereof to a restricted group of purchasers which will be obliged to
agree, among other things, to acquire such securities for their own account
for investment and not with a view to the distribution or resale thereof.
The Borrower acknowledges and agrees that any such private sale may result in
prices and other terms less favorable than if such sale were a public sale
and, notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner. The
Administrative Agent shall be under no obligation to delay a sale of any of
the Pledged Stock for the period of time necessary to permit the Issuer
thereof to register such securities for public sale under the Securities Act,
or under applicable state securities laws, even if such Issuer would agree to
do so.
8
(c) The Borrower further agrees to use its best efforts to do or cause
to be done all such other acts as may be necessary to make such sale or sales
of all or any portion of the Pledged Stock pursuant to this Section valid and
binding and in compliance with any and all other applicable Requirements of
Law. The Borrower further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to the Administrative
Agent and the Lenders, that the Administrative Agent and the Lenders have no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section shall be specifically
enforceable against the Borrower, and the Borrower hereby waives and agrees
not to assert any defenses against an action for specific performance of such
covenants except for a defense that no Event of Default has occurred under
the Credit Agreement.
10. IRREVOCABLE AUTHORIZATION AND INSTRUCTION TO ISSUER. The Borrower
hereby authorizes and instructs each Issuer to comply with any instruction
received by it from the Administrative Agent in writing that (a) states that
an Event of Default has occurred and (b) is otherwise in accordance with the
terms of this Agreement, without any other or further instructions from the
Borrower, and the Borrower agrees that each Issuer shall be fully protected
in so complying.
11. ADMINISTRATIVE AGENT'S APPOINTMENT AS ATTORNEY-IN-FACT. (a) The
Borrower hereby irrevocably constitutes and appoints the Administrative Agent
and any officer or agent of the Administrative Agent, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the place and stead of the Borrower and in the name of
the Borrower or in the Administrative Agent's own name, from time to time in
the Administrative Agent's discretion, for the purpose of carrying out the
terms of this Agreement, to take any and all appropriate action and to
execute any and all documents and instruments which may be necessary or
desirable to accomplish the purposes of this Agreement, including, without
limitation, any financing statements, endorsements, assignments or other
instruments of transfer.
(b) The Borrower hereby ratifies all that said attorneys shall lawfully
do or cause to be done pursuant to the power of attorney granted in
subsection 11(a). All powers, authorizations and agencies contained in this
Agreement are coupled with an interest and are irrevocable until this
Agreement is terminated and the security interests created hereby are
released.
12. DUTY OF ADMINISTRATIVE AGENT. The Administrative Agent's sole duty
with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the Code or otherwise,
shall be to deal with it in the same manner as the Administrative Agent deals
with similar securities and property for its own account, except that the
Administrative Agent shall have no obligation to invest funds held in any
Collateral Account and may hold the same as demand deposits. Neither the
Administrative Agent, any Lender nor any of their respective directors,
officers, employees or agents shall be liable for failure to demand, collect
or realize upon any of the Collateral or for any delay in doing so or
9
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of the Borrower or any other Person or to take any other
action whatsoever with regard to the Collateral or any part thereof.
13. EXECUTION OF FINANCING STATEMENTS. Pursuant to Section 9-402 of
the Code, the Borrower authorizes the Administrative Agent to file financing
statements with respect to the Collateral without the signature of the
Borrower in such form and in such filing offices as the Administrative Agent
reasonably determines appropriate to perfect the security interests of the
Administrative Agent under this Agreement. A carbon, photographic or other
reproduction of this Agreement shall be sufficient as a financing statement
for filing in any jurisdiction.
14. AUTHORITY OF ADMINISTRATIVE AGENT. The Borrower acknowledges that
the rights and responsibilities of the Administrative Agent under this
Agreement with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, voting
right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement shall, as between the
Administrative Agent and the Lenders, be governed by the Credit Agreement and
by such other agreements with respect thereto as may exist from time to time
among them, but, as between the Administrative Agent and the Borrower, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Lenders with full and valid authority so to act or refrain from acting,
and neither the Borrower nor any Issuer shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.
15. NOTICES. All notices, requests and demands to or upon the
Administrative Agent or the Borrower to be effective shall be in writing (or
by telex, fax or similar electronic transfer confirmed in writing) and shall
be deemed to have been duly given or made (1) when delivered by hand or (2)
if given by mail, when deposited in the mails by certified mail, return
receipt requested, or (3) if by telex, fax or similar electronic transfer,
when sent and receipt has been confirmed, addressed to the Administrative
Agent or the Borrower at its address or transmission number for notices
provided in subsection 10.2 of the Credit Agreement. The Administrative
Agent and the Borrower may change their addresses and transmission numbers
for notices by notice in the manner provided in this Section.
16. SEVERABILITY. Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
17. AMENDMENTS IN WRITING; NO WAIVER; CUMULATIVE REMEDIES. (a) None
of the terms or provisions of this Agreement may be waived, amended,
supplemented or otherwise modified except by a written instrument executed by
the Borrower and the Administrative Agent, PROVIDED that any provision of
this Agreement may be waived by the Administrative
10
Agent and the Lenders in a letter or agreement executed by the Administrative
Agent or by telex or facsimile transmission from the Administrative Agent.
(b) Neither the Administrative Agent nor any Lender shall by any act
(except by a written instrument pursuant to subsection 17(a) hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default or
in any breach of any of the terms and conditions hereof. No failure to
exercise, nor any delay in exercising, on the part of the Administrative
Agent or any Lender, any right, power or privilege hereunder shall operate as
a waiver thereof. No single or partial exercise of any right, power or
privilege hereunder shall preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. A waiver by the
Administrative Agent or any Lender of any right or remedy hereunder on any
one occasion shall not be construed as a bar to any right or remedy which the
Administrative Agent or such Lender would otherwise have on any future
occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
18. SECTION HEADINGS. The section headings used in this Agreement are
for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
19. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon the
successors and assigns of the Borrower and shall inure to the benefit of the
Administrative Agent and the Lenders and their successors and permitted
assigns.
20. GOVERNING LAW. This Agreement shall be governed by, and construed
and interpreted in accordance with, the law of the State of New York.
21. TERMINATION AND RELEASE OF COLLATERAL. At such time as the
Obligations then due and payable have been fully satisfied and the
Commitments terminated, the Collateral shall be released from the lien
created by this Agreement, and the security interest created by this
Agreement and all obligations of the Issuers and the Borrower with respect
thereto shall terminate, all without delivery of any instrument or
performance of any act by any party, and all rights to the Collateral shall
revert to the Borrower. Upon request of the Borrower following any such
termination, the Administrative Agent will deliver (at the sole cost and
expense of the Borrower) to the Borrower any Collateral held by the
Administrative Agent hereunder, and execute and deliver (at the sole cost and
expense of the Borrower) to the Borrower such documents as the Borrower shall
reasonably request to evidence such termination.
11
IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly
executed and delivered as of the date first above written.
CORE-XXXX INTERNATIONAL, INC.
By:--------------------------
Name:
Title:
ACKNOWLEDGEMENT AND CONSENT
Each of the Issuers referred to in the foregoing Borrower Stock Pledge
Agreement hereby acknowledges receipt of a copy of the Borrower Stock Pledge
Agreement dated as of August 7, 1996, made by Core-Xxxx International, Inc. for
the benefit of The Chase Manhattan Bank, as Administrative Agent (the "PLEDGE
AGREEMENT"). The undersigned agrees for the benefit of the Administrative Agent
and the Lenders as follows:
1. The undersigned will be bound by the terms of the Pledge Agreement and
will comply with such terms insofar as such terms are applicable to the
undersigned.
2. The undersigned will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in subsection 5(a)
of the Pledge Agreement.
3. The terms of subsection 9(c) of the Pledge Agreement shall apply to it,
MUTATIS MUTANDIS, with respect to all actions that may be required of it under
or pursuant to or arising out of Section 9 of the Pledge Agreement.
C/M PRODUCTS, INC.
By: __________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000,
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
CORE-XXXX INTERRELATED COMPANIES, INC.
By:___________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000,
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
CORE-XXXX MIDCONTINENT, INC.
By:___________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000,
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
SCHEDULE 1
TO PLEDGE AGREEMENT
DESCRIPTION OF PLEDGED STOCK
Class of Stock Certificate
Issuer Stock Number No. of Shares
----------------------------- -------- ----------------- --------------
C/M Products, Inc. Common 2 100
Core-Xxxx Interrelated Common 3 1,000,000
Companies, Inc.
Core-Xxxx Midcontinent, Inc. Common 3 2,000
EXHIBIT E TO
CREDIT AGREEMENT
[FORM OF]
SUBSIDIARIES GUARANTEE
SUBSIDIARIES GUARANTEE, dated as of August 7, 1996, made by each of the
corporations that are signatories hereto (the "GUARANTORS"), in favor of THE
CHASE MANHATTAN BANK, as administrative agent (in such capacity, the
"ADMINISTRATIVE AGENT") for the lenders (the "LENDERS") parties to the Credit
Agreement, dated as of August 7, 1996 (as amended, supplemented or otherwise
modified from time to time, the "CREDIT AGREEMENT"), among Core-Xxxx
International, Inc. (the "BORROWER"), the Lenders and the Administrative
Agent.
W I T N E S S E T H:
WHEREAS, pursuant to the Credit Agreement, the Lenders have severally
agreed to make Loans to and issue or participate in Letters of Credit for the
account of, the Borrower upon the terms and subject to the conditions set
forth therein;
WHEREAS, the Borrower owns directly or indirectly all of the issued and
outstanding stock of each Guarantor;
WHEREAS, the proceeds of the Loans and other extensions of credit will
be used in part to enable the Borrower to make valuable transfers to each
Guarantor in connection with the operation of their respective businesses;
WHEREAS, the Borrower and the Guarantors are engaged in related
businesses, and each Guarantor will derive substantial direct and indirect
benefit from the making of the Loans and other extensions of credit; and
WHEREAS, it is a condition precedent to the obligation of the Lenders to
make their respective Loans and other extensions of credit to the Borrower
under the Credit Agreement that the Guarantors shall have executed and
delivered this Guarantee to the Administrative Agent for the ratable benefit
of the Lenders.
NOW, THEREFORE, in consideration of the premises and to induce the
Administrative Agent and the Lenders to enter into the Credit Agreement and
to induce the Lenders to make their respective Loans and other extensions of
credit to the Borrower under the Credit Agreement, the Guarantors hereby
agree with the Administrative Agent, for the ratable benefit of the Lenders,
as follows:
2
1. DEFINED TERMS. (a) Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them
in the Credit Agreement and the following terms shall have the following
meanings:
"OBLIGATIONS": the collective reference to the unpaid principal of
and interest on the Notes and all other obligations and liabilities of the
Borrower to the Administrative Agent or the Lenders (including, without
limitation, interest accruing at the then applicable rate provided in the
Credit Agreement after the maturity of the Loans and interest accruing at
the then applicable rate provided in the Credit Agreement after the filing
of any petition in bankruptcy, or the commencement of any insolvency,
reorganization or like proceeding, relating to the Borrower, whether or not
a claim for post-filing or post-petition interest is allowed in such
proceeding), whether direct or indirect, absolute or contingent, due or to
become due, now existing or hereafter incurred, which may arise under, out
of, or in connection with, the Credit Agreement, the Notes, the other Loan
Documents or any other document made, delivered or given in connection
therewith, whether on account of principal, interest, reimbursement
obligations, fees, indemnities, costs, expenses or otherwise (including,
without limitation, all fees and disbursements of counsel to the
Administrative Agent or to the Lenders that are required to be paid by the
Borrower or the Guarantor pursuant to the terms of the Credit Agreement or
this Agreement or any other Loan Document).
(b) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Guarantee shall refer to this Guarantee as a whole
and not to any particular provision of this Guarantee, and section and
subsection references are to this Guarantee unless otherwise specified.
(c) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
2. GUARANTEE (a) Subject to the provisions of subsection , each of
the Guarantors hereby, jointly and severally, unconditionally and
irrevocably, guarantees to the Administrative Agent, for the ratable benefit
of the Lenders and their respective successors, indorsees, transferees and
assigns, the prompt and complete payment and performance by the Borrower when
due (whether at the stated maturity, by acceleration or otherwise) of the
Obligations.
(b) Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under
the other Loan Documents shall in no event exceed the amount which can be
guaranteed by such Guarantor under applicable federal and state laws relating
to the insolvency of debtors.
(c) Each Guarantor further agrees to pay any and all expenses
(including, without limitation, all reasonable fees and disbursements of
counsel) which may be paid or incurred by the Administrative Agent or any
Lender in enforcing, or obtaining advice of counsel in respect of, any rights
with respect to, or collecting, any or all of the Obligations and/or
3
enforcing any rights with respect to, or collecting against, such Guarantor
under this Guarantee. This Guarantee shall remain in full force and effect
until the Obligations are paid in full, the Commitments are terminated and no
Letters of Credit are outstanding, notwithstanding that from time to time
prior thereto the Borrower may be free from any Obligations.
(d) Each Guarantor agrees that the Obligations may at any time and from
time to time exceed the amount of the liability of such Guarantor hereunder
without impairing this Guarantee or affecting the rights and remedies of the
Administrative Agent or any Lender hereunder.
(e) No payment or payments made by the Borrower, any of the Guarantors,
any other guarantor or any other Person or received or collected by the
Administrative Agent or any Lender from the Borrower, any of the Guarantors,
any other guarantor or any other Person by virtue of any action or proceeding
or any set-off or appropriation or application at any time or from time to
time in reduction of or in payment of the Obligations shall be deemed to
modify, reduce, release or otherwise affect the liability of any Guarantor
hereunder which shall, notwithstanding any such payment or payments other
than payments made by such Guarantor in respect of the Obligations or
payments received or collected from such Guarantor in respect of the
Obligations, remain liable for the Obligations up to the maximum liability of
such Guarantor hereunder until the Obligations are paid in full, the
Commitments are terminated and no Letters of Credit are outstanding.
(f) Each Guarantor agrees that whenever, at any time, or from time to
time, it shall make any payment to the Administrative Agent or any Lender on
account of its liability hereunder, it will notify the Administrative Agent
in writing that such payment is made under this Guarantee for such purpose.
3. RIGHT OF CONTRIBUTION. Each Guarantor hereby agrees that to the
extent that a Guarantor shall have paid more than its proportionate share of
any payment made hereunder, such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder who has
not paid its proportionate share of such payment. Each Guarantor's right of
contribution shall be subject to the terms and conditions of Section hereof.
The provisions of this Section shall in no respect limit the obligations and
liabilities of any Guarantor to the Administrative Agent and the Lenders, and
each Guarantor shall remain liable to the Administrative Agent and the
Lenders for the full amount guaranteed by such Guarantor hereunder.
4. RIGHT OF SET-OFF. Upon the occurrence and continuance of any Event
of Default, each Guarantor hereby irrevocably authorizes each Lender at any
time and from time to time without notice to such Guarantor or any other
Guarantor, any such notice being expressly waived by each Guarantor, to
set-off and appropriate and apply any and all deposits (general or special,
time or demand, provisional or final), in any currency, and any other
credits, indebtedness or claims, in any currency, in each case whether direct
or indirect, absolute or contingent, matured or unmatured, at any time held
or owing by such Lender to or for the
4
credit or the account of such Guarantor, or any part thereof in such amounts
as such Lender may elect, against and on account of the obligations and
liabilities of such Guarantor to such Lender hereunder and claims of every
nature and description of such Lender against such Guarantor, in any
currency, whether arising hereunder, under the Credit Agreement, any Note,
any other Loan Document or otherwise, as such Lender may elect, whether or
not the Administrative Agent or any Lender has made any demand for payment
and although such obligations, liabilities and claims may be contingent or
unmatured. The Administrative Agent and each Lender shall notify such
Guarantor promptly of any such set-off and the application made by the
Administrative Agent or such Lender, PROVIDED that the failure to give such
notice shall not affect the validity of such set-off and application. The
rights of the Administrative Agent and each Lender under this Section are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) which the Administrative Agent or such Lender may have.
5. NO SUBROGATION. Notwithstanding any payment or payments made by any
of the Guarantors hereunder or any set-off or application of funds of any of
the Guarantors by any Lender, no Guarantor shall be entitled to be subrogated
to any of the rights of the Administrative Agent or any Lender against the
Borrower or any other Guarantor or any collateral security or guarantee or
right of offset held by any Lender for the payment of the Obligations, nor
shall any Guarantor seek or be entitled to seek any contribution or
reimbursement from the Borrower or any other Guarantor in respect of payments
made by such Guarantor hereunder, until all amounts owing to the
Administrative Agent and the Lenders by the Borrower on account of the
Obligations are paid in full and the Commitments are terminated. If any
amount shall be paid to any Guarantor on account of such subrogation rights
at any time when all of the Obligations shall not have been paid in full,
such amount shall be held by such Guarantor in trust for the Administrative
Agent and the Lenders, segregated from other funds of such Guarantor, and
shall, forthwith upon receipt by such Guarantor, be turned over to the
Administrative Agent in the exact form received by such Guarantor (duly
indorsed by such Guarantor to the Administrative Agent, if required), to be
applied against the Obligations, whether matured or unmatured, in such order
as the Administrative Agent may determine.
6. AMENDMENTS, ETC. WITH RESPECT TO THE OBLIGATIONS; WAIVER OF RIGHTS.
Each Guarantor shall remain obligated hereunder notwithstanding that, without
any reservation of rights against any Guarantor and without notice to or
further assent by any Guarantor, any demand for payment of any of the
Obligations made by the Administrative Agent or any Lender may be rescinded
by such party and any of the Obligations continued, and the Obligations, or
the liability of any other party upon or for any part thereof, or any
collateral security or guarantee therefor or right of offset with respect
thereto, may, from time to time, in whole or in part, be renewed, extended,
amended, modified, accelerated, compromised, waived, surrendered or released
by the Administrative Agent or any Lender, and the Credit Agreement, the
Notes and the other Loan Documents and any other documents executed and
delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the Majority
Lenders, as the case may be) may deem advisable from time to time, and any
collateral security, guarantee or right of
5
offset at any time held by the Administrative Agent or any Lender for the
payment of the Obligations may be sold, exchanged, waived, surrendered or
released. Neither the Administrative Agent nor any Lender shall have any
obligation to protect, secure, perfect or insure any Lien at any time held by
it as security for the Obligations or for this Guarantee or any property
subject thereto. When making any demand hereunder against any of the
Guarantors, the Administrative Agent or any Lender may, but shall be under no
obligation to, make a similar demand on the Borrower or any other Guarantor
or guarantor, and any failure by the Administrative Agent or any Lender to
make any such demand or to collect any payments from the Borrower or any such
other Guarantor or guarantor or any release of the Borrower or such other
Guarantor or guarantor shall not relieve any of the Guarantors in respect of
which a demand or collection is not made or any of the Guarantors not so
released of their several obligations or liabilities hereunder, and shall not
impair or affect the rights and remedies, express or implied, or as a matter
of law, of the Administrative Agent or any Lender against any of the
Guarantors. For the purposes hereof "demand" shall include the commencement
and continuance of any legal proceedings.
7. GUARANTEE ABSOLUTE AND UNCONDITIONAL. Each Guarantor waives any and
all notice of the creation, renewal, extension or accrual of any of the
Obligations and notice of or proof of reliance by the Administrative Agent or
any Lender upon this Guarantee or acceptance of this Guarantee, the
Obligations, and any of them, shall conclusively be deemed to have been
created, contracted or incurred, or renewed, extended, amended or waived, in
reliance upon this Guarantee; and all dealings between the Borrower and any
of the Guarantors, on the one hand, and the Administrative Agent and the
Lenders, on the other hand, likewise shall be conclusively presumed to have
been had or consummated in reliance upon this Guarantee. Each Guarantor
waives diligence, presentment, protest, demand for payment and notice of
default or nonpayment to or upon the Borrower or any of the Guarantors with
respect to the Obligations. Each Guarantor understands and agrees that this
Guarantee shall be construed as a continuing, absolute and unconditional
guarantee of payment without regard to (a) the validity, regularity or
enforceability of the Credit Agreement, any Note or any other Loan Document,
any of the Obligations or any other collateral security therefor or guarantee
or right of offset with respect thereto at any time or from time to time held
by the Administrative Agent or any Lender (b) any defense, set-off or
counterclaim (other than a defense of payment or performance) which may at
any time be available to or be asserted by the Borrower against the
Administrative Agent or any Lender, or (c) any other circumstance whatsoever
(with or without notice to or knowledge of the Borrower or such Guarantor)
which constitutes, or might be construed to constitute, an equitable or legal
discharge of the Borrower for the Obligations, or of such Guarantor under
this Guarantee, in bankruptcy or in any other instance. When pursuing its
rights and remedies hereunder against any Guarantor, the Administrative Agent
and any Lender may, but shall be under no obligation to, pursue such rights
and remedies as it may have against the Borrower or any other Person or
against any collateral security or guarantee for the Obligations or any right
of offset with respect thereto, and any failure by the Administrative Agent
or any Lender to pursue such other rights or remedies or to collect any
payments from the Borrower or any such other Person or to realize upon any
such collateral security or guarantee or to exercise any such right of
offset, or any release of the Borrower or any such other Person or any such
collateral security,
6
guarantee or right of offset, shall not relieve such Guarantor of any
liability hereunder, and shall not impair or affect the rights and remedies,
whether express, implied or available as a matter of law, of the
Administrative Agent and the Lenders against such Guarantor. This Guarantee
shall remain in full force and effect and be binding in accordance with and
to the extent of its terms upon each Guarantor and the successors and assigns
thereof, and shall inure to the benefit of the Administrative Agent and the
Lenders, and their respective permitted successors, indorsees, transferees
and assigns, until all the Obligations and the obligations of each Guarantor
under this Guarantee shall have been satisfied by payment in full, the
Commitments shall be terminated and no Letters of Credit are outstanding,
notwithstanding that from time to time during the term of the Credit
Agreement the Borrower may be free from any Obligations.
8. REINSTATEMENT. This Guarantee shall continue to be effective, or be
reinstated, as the case may be, if at any time payment, or any part thereof,
of any of the Obligations is rescinded or must otherwise be restored or
returned by the Administrative Agent or any Lender upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or any
Guarantor, or upon or as a result of the appointment of a receiver,
intervenor or conservator of, or trustee or similar officer for, the Borrower
or any Guarantor or any substantial part of its property, or otherwise, all
as though such payments had not been made.
9. PAYMENTS. Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent without set-off or counterclaim in
U.S. Dollars at the office of the Administrative Agent located at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000.
10. REPRESENTATIONS AND WARRANTIES. Each Guarantor hereby represents
and warrants that:
(a) it is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation and has the
corporate power and authority and the legal right to own and operate its
property, to lease the property it operates and to conduct the business in
which it is currently engaged;
(b) it has the corporate power and authority and the legal right to
execute and deliver, and to perform its obligations under, this Guarantee,
and has taken all necessary corporate action to authorize its execution,
delivery and performance of this Guarantee;
(c) this Guarantee constitutes a legal, valid and binding obligation of
such Guarantor enforceable in accordance with its terms, except as affected
by bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting the enforcement of creditors'
rights generally, general equitable principles and an implied covenant of
good faith and fair dealing;
(d) the execution, delivery and performance of this Guarantee will not
violate any provision of any Requirement of Law or Contractual Obligation of
such Guarantor and will not result in or require the creation or imposition
of any Lien on any of the properties or
7
revenues of such Guarantor pursuant to any Requirement of Law or Contractual
Obligation of the Guarantor;
(e) no consent or authorization of, filing with, or other act by or in
respect of, any arbitrator or Governmental Authority and no consent of any
other Person (including, without limitation, any stockholder or creditor of
such Guarantor) is required in connection with the execution, delivery,
performance, validity or enforceability of this Guarantee;
Each Guarantor agrees that the foregoing representations and
warranties shall be deemed to have been made by such Guarantor on the date of
each borrowing by the Borrower under the Credit Agreement on and as of such
date of borrowing as though made hereunder on and as of such date.
11. AUTHORITY OF ADMINISTRATIVE AGENT. Each Guarantor acknowledges
that the rights and responsibilities of the Administrative Agent under this
Guarantee with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, right,
request, judgment or other right or remedy provided for herein or resulting
or arising out of this Guarantee shall, as between the Administrative Agent
and the Lenders, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them,
but, as between the Administrative Agent and such Guarantor, the
Administrative Agent shall be conclusively presumed to be acting as agent for
the Lenders with full and valid authority so to act or refrain from acting,
and no Guarantor shall be under any obligation, or entitlement, to make any
inquiry respecting such authority.
12. NOTICES. All notices, requests and demands to or upon the
Administrative Agent, any Lender or any Guarantor to be effective shall be in
writing (or by telex, fax or similar electronic transfer confirmed in
writing) and shall be deemed to have been duly given or made (1) when
delivered by hand or (2) if given by mail, when deposited in the mails by
certified mail, return receipt requested, or (3) if by telex, fax or similar
electronic transfer, when sent and receipt has been confirmed, addressed as
follows:
(a) if to the Administrative Agent or any Lender, at its address or
transmission number for notices provided in subsection 10.2 of the Credit
Agreement; and
(b) if to any Guarantor, at its address or transmission number for
notices set forth under its signature below.
The Administrative Agent, each Lender and each Guarantor may change its
address and transmission numbers for notices by notice in the manner provided
in this Section.
13. COUNTERPARTS. This Guarantee may be executed by one or more of the
Guarantors on any number of separate counterparts, and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument. A set of the counterparts of this Guarantee signed by all the
Guarantors shall be lodged with the Administrative Agent.
8
14. SEVERABILITY. Any provision of this Guarantee 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.
15. INTEGRATION. This Guarantee represents the agreement of each
Guarantor with respect to the subject matter hereof and there are no promises
or representations by the Administrative Agent or any Lender relative to the
subject matter hereof not reflected herein.
16. AMENDMENTS IN WRITING; NO WAIVER; CUMULATIVE REMEDIES. (a) None
of the terms or provisions of this Guarantee with respect to any Guarantor
may be waived, amended, supplemented or otherwise modified except by a
written instrument executed by such Guarantor and the Administrative Agent,
PROVIDED that any provision of this Guarantee may be waived by the
Administrative Agent and the Lenders in a letter or agreement executed by the
Administrative Agent or by telex or facsimile transmission from the
Administrative Agent.
(b) Neither the Administrative Agent nor any Lender shall by any act
(except by a written instrument pursuant to subsection hereof), delay,
indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default or
in any breach of any of the terms and conditions hereof. No failure to
exercise, nor any delay in exercising, on the part of the Administrative
Agent or any Lender, any right, power or privilege hereunder shall operate as
a waiver thereof. No single or partial exercise of any right, power or
privilege hereunder shall preclude any other or further exercise thereof or
the exercise of any other right, power or privilege. A waiver by the
Administrative Agent or any Lender of any right or remedy hereunder on any
one occasion shall not be construed as a bar to any right or remedy which the
Administrative Agent or such Lender would otherwise have on any future
occasion.
(c) The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.
17. SECTION HEADINGS. The section headings used in this Guarantee are
for convenience of reference only and are not to affect the construction
hereof or be taken into consideration in the interpretation hereof.
18. SUCCESSORS AND ASSIGNS. This Guarantee shall be binding upon the
successors and assigns of each Guarantor and shall inure to the benefit of
the Administrative Agent and the Lenders and their successors and permitted
assigns.
19. GOVERNING LAW. This Guarantee shall be governed by, and construed
and interpreted in accordance with, the law of the State of New York.
9
IN WITNESS WHEREOF, each of the undersigned has caused this
Guarantee to be duly executed and delivered by its duly authorized officer as
of the day and year first above written.
C/M PRODUCTS, INC.
By: ___________________________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
CORE-XXXX INTERRELATED COMPANIES, INC.
By:____________________________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
CORE-XXXX MIDCONTINENT, INC.
By:____________________________________________
Name:
Title:
Address for
Notices: 000 Xxxxxx Xxxxx Xxxx., Xxxxx 000
Xxxxx Xxx Xxxxxxxxx, XX 00000
Fax: (000) 000-0000
EXHIBIT F TO
CREDIT AGREEMENT
----------------
[FORM OF]
CORE-XXXX INTERNATIONAL, INC.
BORROWING BASE CERTIFICATE
Pursuant to subsection 6.2(f) of the Credit Agreement, dated as of
August 7, 1996 (the "CREDIT AGREEMENT"; terms defined therein being used herein
as therein defined), among Core-Xxxx International, Inc., a Delaware corporation
(the "BORROWER"), the several banks and other financial institutions from time
to time parties to the Credit Agreement (the "LENDERS") and The Chase Manhattan
Bank, a New York banking corporation, as administrative agent for the Lenders,
the undersigned hereby certifies that the following statements and figures are
true on the date hereof:
CORE-XXXX INTERNATIONAL, INC.
BORROWING BASE CERTIFICATE
FOR THE PERIOD ENDING
DATE
------------------
ADVANCE U.S. CANADA CANADA TOTAL TOTAL
RATE (US$) (CDN$) (US$) (US$) AVAILABLE
--------- ---------- ---------- ---------- ---------- ----------
Uncleared US Checks
Available Uncleared US Checks: 90%
Canadian Cash Equivalents
Less Ineligibles and Canadian Cash Adjustment
Available Canadian Cash Equiv:
85%
Cash Held by Agent
Available Cash Held by Agent: 100%
Gross Accounts Receivable Per Aging
Less Intercompany Receivables
Gross A/R Net of Intercompany
Less Other Ineligibles:
Past Dues Greater than 45 Days
Contras
Employee Accounts
Manufacturer Representatives
Government Receivables
Bankruptcy
Loss/accounts in collection
Special Terms
25% Cross-age
Credits Greater Than 45 Days
--------- ---------- ---------- ---------- ---------- ----------
Total Ineligibles
Less Reserve-Customer Rebates (100,000)
Total Eligible Receivable
Available Accounts Receivables 85%
Vendor Receivables
Less Ineligibles:
Contras
50% due 180 days or more
Total Ineligibles:
Total Eligible Vendor Receivables
Available Amt. of Vendor Receivables 75%
Cigarette Inventory on 0 Day EFT (Including
Affixed & Unaffixed Tax Stamps)
DATE
------------------
ADVANCE U.S. CANADA CANADA TOTAL TOTAL
RATE (US$) (CDN$) (US$) (US$) AVAILABLE
--------- ---------- ---------- ---------- ---------- ----------
Less Ineligibles
Stamps in Excess of Bond
Consignment Inventory
Landlord Lien Reserve
Inventory Reserve
Total Ineligibles
Eligible Cigarette Inventory
Available Cigarette Inventory 85%
Tobacco & Cigar Inventory
Less Ineligibles
Consignment Inventory
Landlord Lien Reserve
Inventory Reserve
Total Ineligibles
Eligible Tobacco & Cigar Inventory
Available Tobacco & Cigar Inventory 80%
Other Inventory
Less Ineligibles
Consignment Inventory
Landlord Lien Reserve
Inventory Reserve
Total Ineligibles
Eligible Other Inventory
Available Other Inventory 65%
Total Available
The following is a summary of Core-Xxxx International, Inc.'s availability as
of (ENTER DATE):
Available Uncleared US Checks . . . . . . . . . $ ______
Available Canadian Cash Equivalents . . . . . . $ ______
Available Cash Held by Agent . . . . . . . . . $ ______
Available Accounts Receivable . . . . . . . . . $ ______
Available Vendor Receivables . . . . . . . . . $ ______
Available Cigarette and tax Stamp Inventory . . $ ______
Available Cigar and Tobacco Inventory . . . . . $ ______
Available Other Inventory . . . . . . . . . . . $ ______
Total Available Collateral . . . . . . . . . $ ______
CORE-XXXX INTERNATIONAL,
INC.
By:_________________________
Name:
Title:
Dated: ________ __, 199_
EXHIBIT G TO
CREDIT AGREEMENT
[FORM OF]
CORE-XXXX INTERNATIONAL, INC.
BORROWING CERTIFICATE
Pursuant to subsection 2.2 of the Credit Agreement, dated as of August 7,
1996 (the "CREDIT AGREEMENT"; terms defined therein being used herein as therein
defined), among Core-Xxxx International, Inc., a Delaware corporation
(the "BORROWER"), the several banks and other financial institutions from time
to time parties to the Credit Agreement (the "LENDERS") and The Chase
Manhattan Bank, a New York banking corporation, as administrative agent for the
Lenders, the undersigned hereby requests [a withdrawal from the US Cash
Collateral Account and] [a Revolving Credit Loan] under the Credit Agreement,
and in that connection sets forth below the information relating to such
proposed borrowing (the "PROPOSED BORROWING"):
(i) The aggregate amount of the Proposed Borrowing is $ ________
[of which $ ________ shall constitute a withdrawal from the US Cash Collateral
Account and $ ________ shall constitute a Revolving Credit Loan].
(ii) The requested Borrowing Date of the Proposed Borrowing is ________ __,
199_.
(iii) The Type of Revolving Credit Loan(s) comprising the Proposed
Borrowing is/are [Eurodollar Loans] [ABR Loans] [a combination thereof].
(iv) The Proposed Borrowing will [not] result in an Overadvance Amount.
[(v) The initial Interest Period for each Eurodollar Loan made as part of
the Proposed Borrowing is [one] [two] [three] [six] month[s].]
The undersigned hereby certifies that the following statements are true on
the date hereof, and will be true on the date of the Proposed Borrowing:
(A) The representations and warranties of the Borrower set forth in the
Credit Agreement and each of the other Loan Documents to which the Borrower is a
party or which are contained in any certificate furnished by or on behalf of the
Borrower pursuant to or in connection with the Credit Agreement or any of the
other Loan Documents are true and correct on and as of the date hereof with the
same effect as if made on the date hereof except for representations and
warranties expressly stated to relate to a specific earlier date, in which case
such representations and warranties are true and correct as of such earlier
date; and
(B) No Default or Event of Default has occurred and is continuing as of
the date hereof or after giving effect to the Revolving Credit Loans to be made
on the
2
date hereof and/or the issuance of any Letters of Credit to be issued on
the date hereof.
(C) After giving effect to the Proposed Borrowing, the Aggregate Covered
Outstanding Revolving Extensions of Credit will not exceed the sum of the
Borrowing Base (as determined by reference to the Borrowing Base Certificate and
Supplemental Reporting most recently required to be delivered in accordance with
subsection 6.2(f) of the Credit Agreement) and the Overadvance Limit.
IN WITNESS WHEREOF, the undersigned have hereunto set our names as of the
date set forth below.
CORE-XXXX INTERNATIONAL, INC.
By:--------------------------
Name:
Title:
Date: ________ __, 199_
1
EXHIBIT H TO
CREDIT AGREEMENT
---------------
[FORM OF]
CORE-XXXX INTERNATIONAL, INC.
RESPONSIBLE OFFICER'S CERTIFICATE
Pursuant to subsection 6.2(b) of the Credit Agreement, dated as of
August 7, 1996 (the "CREDIT AGREEMENT"; terms defined therein being used
herein as therein defined), among Core-Xxxx International, Inc., a Delaware
corporation (the "BORROWER"), the several banks and other financial institutions
from time to time parties to the Credit Agreement (the "LENDERS") and The Chase
Manhattan Bank, a New York banking corporation, as administrative agent for the
Lenders, the undersigned hereby certifies the following:
1. to the best of the undersigned's knowledge, during the period of the
financial statements delivered pursuant to subsection 6.1 (a) (b) and
(c) of the Credit Agreement (the Financial Statements"),
(a) no Subsidiary has been formed or acquired (or, if any such
Subsidiary has been formed or acquired, the Borrower has complied
with the requirements of subsection 6.12 of the Credit Agreement
with respect thereto);
(b) neither the Borrower nor any of its Subsidiaries has changed its
name, its principal place of business, its chief executive office
or the location of any material item of tangible Collateral
without complying with the requirements of the Credit Agreement
and the Security Documents with respect thereto; and
(c) the Borrower has observed or performed in all material respects
all of its covenants and other agreements, and satisfied every
condition, contained in the Credit Agreement and the other Loan
Documents to be observed, performed or satisfied by it, and that
undersigned has obtained no knowledge of any Default or Event of
Default except as specified in such certificate; provided that
with respect to the financial statements delivered pursuant to
subsection 6.1(c) of the Credit Agreement, such certificate need
only cover the items set forth in clause (a) above; and
2. in the case of the financial statements delivered pursuant to
subsection 6.1(a) and (b) of the Credit Agreement, the following
statements and figures are true on the date hereof:
[Insert, in reasonable detail, a calculation of the financial
covenants set forth in subsection 7.1 of the Credit Agreement for the
period corresponding to the "Financial Statements" and, with respect
to the annual financial statements required to be furnished pursuant
to subsection 6.1(a) of the Credit Agreement, a reconciliation of such
financial statements from the last-in first-out inventory valuation
method to the
first-in, first-out inventory valuation method in order to
calculate the financial covenants set forth in subsection 7.1 of the
Credit Agreement.]
IN WITNESS WHEREOF, the undersigned has hereunto set my name as
of the date set forth below.
CORE-XXXX INTERNATIONAL, INC.
By:
---------------------------
Name:
Title:
Date: ________ __, 199_
EXHIBIT I TO
CREDIT AGREEMENT
[FORM OF]
CORE-XXXX INTERNATIONAL, INC.
SUPPLEMENTAL REPORTING
AS OF:
Pursuant to subsection 6.2(f) of the Credit Agreement, dated as of
August 7, 1996 (the "CREDIT AGREEMENT"; terms defined therein being used
herein as therein defined), among Core-Xxxx International, Inc., a Delaware
corporation (the "BORROWER"), the several banks and other financial
institutions from time to time parties to the Credit Agreement (the
"LENDERS") and The Chase Manhattan Bank, a New York banking corporation, as
administrative agent for the Lenders, the undersigned hereby certifies that
the following statements and figures are true on the date hereof:
REPORTING FOR PERIOD ENDED:___________
WEEKLY ACCOUNTS RECEIVABLE REPORTING*
Canada Canada
U.S. CDN$ US$ Total (prior
----- ------ ------ ----- week end)
Beginning Accounts Receivable _____ _____ _____ _____
Gross Billings _____ _____ _____ _____
Other Debits _____ _____ _____ _____
Collection Receipts Applied _____ _____ _____ _____
Discounts Taken** _____ _____ _____ _____
Credits Issued** _____ _____ _____ _____
Returns** _____ _____ _____ _____
Write Offs** _____ _____ _____ _____
Other Credit Adjustments** _____ _____ _____ _____
Intercompany Receivables _____ _____ _____ _____
Ending Accounts Receivable,
net of Intercompany _____ _____ _____ _____ (current
week end)
______________________
**Items notes are to be detailed on a monthly basis, and presented in total on a
weekly basis.
2
WEEKLY INVENTORY REPORTING*
-------------------------------
Cigarette
Inventory
(zero day
EFT terms)
Including Tobacco and Other
stamps Cigar Inventory Inventory Total
--------- --------------- --------- -----
Beginning Inventory Balance
(prior week end) _____ _____ _____ _____
Plus: Purchases _____ _____ _____ _____
Less: Cost of Goods Sold _____ _____ _____ _____
Other _____ _____ _____ _____
Ending Inventory Balance
(current week end) _____ _____ _____ _____
Monthly Inventory Reporting*
----------------------------
Inventory by Location:
List Locations Here _____ _____ _____ _____
List Locations Here _____ _____ _____ _____
List Locations Here _____ _____ _____ _____
List Locations Here _____ _____ _____ _____
Total: _____ _____ _____ _____
___________________
* Documents to be submitted per Schedule I to this certificate are integral
part of the above reporting.
** Items noted are to be detailed on a monthly basis, and presented in total
on a weekly basis.
IN WITNESS WHEREOF, the undersigned has hereunto set my name as of the
date set forth below.
CORE-XXXX INTERNATIONAL, INC.
By:_______________________________
Name:
Title:
Date: ________ __, 199_
SCHEDULE I
I. WEEKLY REPORTS
On the third Business Day following the end of each calendar week
and on the third Business Day of the next calendar month, the Borrower will
deliver to the Administrative Agent by facsimile transmission the
Supplemental Reporting with respect to the close of business on the last
calendar day of the immediately preceding calendar week or calendar month, as
the case may be, duly completed and certified by a Responsible Officer of the
Borrower.
On the third Business Day following the end of each calendar week
and on the third Business Day of the next calendar month, the Borrower will
deliver to the Administrative Agent by overnight courier the following
reports with respect to the close of business on the last calendar day of the
immediately preceding calendar week or calendar month, as the case may be:
1. An accounts receivable activity report (i.e., rollforward) for the US and
Canada operations, with supporting documentation including system generated
reports detailing gross sales, collections, and adjustments.
2. An accounts receivable consolidating aging for both the US and Canada
operations. The total on the consolidating aging must agree to the ending
balance on the activity report referred to in item 1.
3. Supporting documentation for all ineligible accounts receivable items
4. A perpetual inventory activity report (i.e., rollforward) by category with
supporting documentation including system generated reports detailing
receipts, sales, and adjustments.
5. A perpetual inventory report, i.e., a one page corporate rollup and summary
sheet. The total of which agrees to the ending balance on the activity
report referred to in item 4.
6. Calculation/worksheet of tax stamps eligible and not eligible.
7. A copy of weekly bank statements (or balances as reported from a bank
reporting system) of gross collected and available funds for account numbers
(TO BE PROVIDED) reconciled to the amount of uncleared US checks as
presented on the Borrowing Base Certificate.
8. Schedule of Canadian Cash Equivalents reconciled to amounts as presented on
the Borrowing Base Certificate.
9. Details of accrual calculation used to determine the vendor receivable, by
category, i.e., quarterly program, semi-annual program and annual program.
2
II. MONTHLY REPORTS
On the tenth Business Day of each fiscal month, the Borrower will
deliver to the Agent by overnight courier the following reports with respect to
the previous fiscal month:
1. An accounts receivable activity report (i.e., rollforward) for the US and
Canada operations, with supporting documentation including system generated
reports detailing gross sales, collection, and adjustments. Adjustments are
to be detailed for all dilutive items such as discounts taken, credits
issued, returns, write-offs, and other credit adjustments. Although a month
end Borrowing Base Certificate is not required, a reconciliation must be
performed from the weekly to the monthly rollforward.
2. A consolidating aged accounts receivable aging by division for both the US
and Canada operations. The total on the consolidating aging must agree to
the ending balance on the monthly activity report referred to in item 1.
3. A corporate chain report for accounts receivable, summarizing the top ten
accounts on the report. The top ten (excluding Southland and any other
customers which are on the "Franchise-No" report but should be on the
"Franchise-Yes" report) should be accumulated from the "Franchise-No"
portion of the corporate chain report. The "Franchise-Yes" report should
also be provided.
4. A perpetual Inventory report by category and by division.
5. Supporting documentation for all ineligible inventory items, including
inventory reserves, landlord lien reserves and consigned inventory.
6. Summary of amounts payable to the top ten tax vendors.
7. A schedule on a state by state basis of accrued or payable excise taxes and
bonding with respect thereto.
8. "Cigarette inventory" and "other inventory" turnover by division.
[LETTERHEAD OF XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX]
August 7, 1996
Exhibit J-1
To the Lenders Party to the Credit Agreement
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
Ladies and Gentlemen:
We have acted as special counsel to Core-Xxxx International, Inc., a
Delaware corporation (the "Borrower"), C/M Products, Inc., a California
corporation and a wholly-owned subsidiary of the Borrower ("C/M Products"),
Core-Xxxx Interrelated Companies, Inc., a California corporation and a
wholly-owned subsidiary of the Borrower ("CMIC"), and Core-Xxxx Midcontinent,
Inc., an Arkansas corporation and a wholly-owned subsidiary of the Borrower ("CM
Midcontinent" and, together with the Borrower, C/M Products and CMIC,
collectively the "Loan Parties" and each a "Loan Party"), in connection with the
Credit Agreement, dated as of
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 2
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
August 7, 1996 (the "Credit Agreement"), among the Borrower, the several banks
and other financial institutions parties thereto as lenders (the "Lenders"), and
The Chase Manhattan Bank, a New York banking corporation, as Administrative
Agent. Capitalized terms not otherwise defined herein shall have the respective
meanings given them in the Credit Agreement. This opinion is being furnished to
you at the request of the Borrower pursuant to Section 5. l(1()(l) of the Credit
Agreement.
In connection with this opinion, we have examined originals, or
copies certified or otherwise identified to our satisfaction, of the following
documents, each dated as of the date hereof (collectively, the "Documents"):
1. The Credit Agreement;
2. The Revolving Credit Notes;
3. The Term Notes;
4. The Security Agreement;
5. The Borrower Stock Pledge Agreement; and
6. The Subsidiaries Guarantee.
In addition, we have examined such corporate records of the Loan
Parties as we have considered appropriate, including copies of the charter and
by-laws of the Borrower as in effect on the date hereof and certified copies of
resolutions of the board of directors of the Borrower, and such other
certificates, agreements and
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 3
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
documents as we deemed relevant and necessary as a basis for the opinions
hereafter expressed.
In our examination of the aforesaid documents, we have assumed,
without independent investigation, the genuineness of all signatures, the due
authorization, execution and delivery of the Documents by each Person other than
the Borrower that are parties to the Documents, the enforceability of the
Documents against each party thereto other than the Loan Parties that are
parties thereto, the authenticity of all documents submitted to us as originals,
the conformity to the original documents of all documents submitted to us as
certified, photostatic, reproduced or conformed copies of validly existing
agreements or other documents, the authenticity of all such latter documents and
the legal capacity of all individuals who have executed any of the documents.
In expressing the opinions set forth herein we have relied upon the
factual matters contained in the representations and warranties of the Loan
Parties and upon certificates of public officials and officers of the Loan
Parties. Whenever an opinion is indicated to be based on our knowledge, it is
intended to signify that in the course of our representation of the Loan Parties
in connection with the transactions contemplated by the Documents, no
information came to the attention of the attorneys at our firm who are actually
engaged in such transactions that would give such attorneys actual knowledge of
the existence or absence of such facts. We have not
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 4
Referred to Below and The Chase Manhattan Bank
as Administrative Agent.
undertaken any independent investigation to determine the existence or absence
of such facts, and no inference as to our knowledge of the existence or absence
of such facts should be drawn from the fact of our representation of the Loan
Parties.
Based upon the foregoing, and subject to the assumptions, exceptions
and qualifications set forth herein, we are of the opinion that:
1. The Borrower is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware and has the
corporate power and authority to own and operate its property, to lease the
property it operates as lessee and to conduct the business in which it is
currently engaged.
2. The Borrower has the corporate power and authority to make,
deliver and perform the Loan Documents to which it is a party and to borrow
under the Credit Agreement and has taken all necessary corporate action to
authorize the borrowings on the terms and conditions of the Loan Documents to
which it is a party and to authorize the execution, delivery and performance of
the Loan Documents to which it is a party. No consent or authorization of,
filing with, notice to or other act by or in respect of, any Governmental
Authority of the State of New York, the United States of America or under the
General Corporation law of the State of Delaware (the "GLC") is required in
connection with the borrowings under the Credit Agreement or the execution,
delivery, performance, validity or enforceability of the
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 5
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
Loan Documents to which the Borrower is a party, except for such filings as are
necessary to perfect security interests.
3. Each of the Loan Documents to which the Borrower is a party has
been duly executed and delivered on behalf of the Borrower. Each of the Loan
Documents constitutes a legal, valid and binding obligation of each Loan Party
which is a party thereto, enforceable against such Loan Party in accordance with
its terms.
4. The execution, delivery and performance of each of the Loan
Documents to which each Loan Party is a party, the borrowings under the Credit
Agreement by the Borrower and the use of proceeds thereof as set forth in
Section 4.16 of the Credit Agreement will not violate any Requirement of Law of
the State of New York, the United States of America or under the GCL or any
Contractual Obligation known to us of such Loan Party, and will not result in,
or require, the creation or imposition of any Lien on any of its properties or
revenues pursuant to any such Requirement of Law or Contractual Obligation known
to us (except for Liens in favor of the Administrative Agent for the benefit of
the Lenders as contemplated by the Documents).
5. The Borrower is not an "investment company" within the meaning of
the Investment Company Act of 1940, as amended.
6. The Borrower Stock Pledge Agreement is effective to create in
favor of the Administrative Agent, for the benefit of the Lenders, a valid and
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 6
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
enforceable security interest in the Pledged Stock described therein and,
assuming that (i) the Administrative Agent has, at the date hereof, possession
in the State of New York of the Pledged Stock and maintains continuous
possession thereof and (ii) the Lenders and the Administrative Agent have
entered into the Credit Agreement in good faith without notice of any adverse
claim to such Pledged Stock, and after giving effect to the making of Loans on
the date hereof, the Administrative Agent has a valid and perfected security
interest, for the benefit of the Lenders and the Administrative Agent, to the
extent provided in the Borrower Stock Pledge Agreement, in all right, title and
interest of the Borrower in such Pledged Stock, which security interest has
priority over any other security interest in the Pledged Stock which can be
perfected under the UCC.
7. After giving effect to the making of the Loans on the date
hereof, each Security Agreement is effective to create in favor of the
Administrative Agreement, for the benefit of the Lenders and the Administrative
Agent, a valid and enforceable security interest in such of the Collateral
purported to be covered thereby and in which a security interest may be created
under Article 9 of the UCC, except that the Security Agreements to which a Loan
Party is a party will create such interests in property in which such Loan Party
has no currently existing rights only when such Loan Party acquires right
therein.
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 7
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
8. Except as set forth in Schedule 4.6 to the Credit Agreement, we
have no knowledge of any litigation, investigation or proceeding of or before
any arbitrator or Governmental Authority, pending or threatened against the
Borrower or any of its Subsidiaries or against any of its or their respective
properties or revenues (a) with respect to any of the Loan Documents or any of
the transactions contemplated thereby, or (b) which could reasonably be expected
to have a Material Adverse Effect.
* * *
The foregoing opinion is subject to the following additional
assumptions, exceptions and qualifications:
(a) The enforceability of the Documents may be: (i) subject to
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting creditors' rights generally; (ii) subject
to general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity); (iii) subject to the
qualification that certain remedial provisions of the Security Documents are or
may be unenforceable in whole or in part under the laws of the State of New
York, but the inclusion of such provisions does not make the remedies afforded
by such Security Documents inadequate for the practical realization of the
rights and benefits purported to be provided thereby,
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 8
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
except for the economic consequences resulting from any delay imposed by, or any
procedure required by, applicable New York laws, rules, regulations and court
decisions and by constitutional requirements in and of the State of New York;
and (iv) subject to the qualification that, insofar as provisions contained in
the Documents provide for indemnification, the enforcement thereof may be
limited by public policy considerations.
(b) We express no opinion as to: (i) the enforceability of any
provisions in the Guarantees purporting to preserve and maintain the liability
of any party thereto despite the fact that the guaranteed debt is unenforceable
due to illegality or the fact that the obligee has voluntarily released the
primary obligor's liability on the guaranteed debt; (ii) the enforceability of
any provisions contained in the Documents that purport to establish (or may be
construed to establish) evidentiary standards; (iii) the enforceability of any
provisions contained in the Documents that constitute waivers not permitted
under applicable law; and (iv) the enforceability of forum selection clauses in
the federal courts.
(c) We express no opinion as to: (i) any Loan Party's right,
title or interest in or to any Collateral or the description of any property
(real, personal or mixed) in the Security Documents, the UCC financing
statements or any other Documents; (ii) the laws of any state other than the
State of New York or the perfection and effect of perfection or non-perfection
of a security interest in the
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 9
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
Collateral subject to the laws of any state other than New York; (iji) the
perfection of security interests in equipment used in farming operations, farm
products, consumer goods, timber or minerals or the like, or accounts resulting
from the sale thereof; (iv) except as expressly stated herein, the creation,
validity, perfection, priority or enforceability of any security interest sought
to be created in any patents, trademarks, tradenames, service marks, copyrights,
aircraft, deposit accounts, insurance policies, real property or any other items
of property to the extent that a security interest therein is excluded from the
coverage of Article 9 of the UCC; (v) except as specifically set forth in
paragraph 6 above, any opinion as to the perfection or priority of any security
interest; or (vi) the creation, validity, perfection, priority or enforceability
of any security interest with respect to any item of Collateral subject to
Section 552 of Title 11 of the United States Code, 11 U.S.C. xx.xx. 101, et seq.
(the "Bankruptcy Code") which limits the extent to which property acquired by a
debtor after the commencement of a case under the Bankruptcy Code may be subject
to a security interest arising from a security agreement entered into by the
debtor before the commencement of such case. We have also assumed that no item
of Collateral (or any agreement relating thereto) contains or will contain any
provision purportedly prohibiting or otherwise restricting the assignability
thereof or the granting of a security interest with respect thereto.
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
To the Lenders Party to the Credit Agreement 10
Referred to Below and The Chase Manhattan Bank
as Administrative Agent
(d) With regard to the choice of law provisions contained in
the Documents and any reference to certain provisions of the UCC contained
therein, we wish to point out that, whether through the operation of applicable
choice of law rules or otherwise, the laws of the jurisdiction in which an item
of collateral is located or in which the debtor is located may govern the
perfection of the security interests created by the Documents and the
enforceability of the rights or remedies provided in the Documents upon the
occurrence of a Default or Event of Default and, to the extent that the
Documents provide otherwise, such provisions may be unenforceable.
We express no opinion herein as to the law of any jurisdiction other
than the federal laws of the United States of America and the laws of the State
of New York and the GCL. Our opinion is rendered only with respect to the laws,
and the rules, regulations and orders thereunder, which are currently in effect.
Please be advised that no member of this firm is admitted to practice in the
State of Delaware.
This letter is furnished by us solely for your benefit in connection
with the transactions referred to in the Credit Agreement and the other
Documents and may not be circulated to, or relied upon by, any other Person or
used in any other context.
Very truly yours,
/s/ Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
XXXX, WEISS, RIFKIND, XXXXXXX & XXXXXXXX
Exhibit J-2
[LETTERHEAD OF SHEPPARD, MULLIN, XXXXXXX & HAMPTON LLP]
August 7, 1996
The Chase Manhattan Bank,
as Administrative Agent
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Each of the Lenders party to the
Credit Agreement referred to below
Re: Credit Agreement among Core-Xxxx International, Inc.
the Lenders from time to time parties thereto
and The Chase Manhattan Bank, as Administrative Agent,
dated as of August 7, 1996
Dear Sirs:
We have acted as special local counsel in the State of California to
The Chase Manhattan Bank, as administrative agent for the Lenders referred to
below, in connection with (a) the Credit Agreement dated as of August 7, 1996
(the "Credit Agreement"), among Core-Xxxx International, Inc., a Delaware
corporation (the "Borrower"), the lenders party thereto (collectively, the
"Lenders"), and The Chase Manhattan Bank, as administrative agent for the
Lenders (in such capacity, the "Agent"), and (b) the Security Documents listed
on Schedule 1 attached hereto delivered pursuant to the Credit Agreement (the
"State Security Documents").
The opinions expressed below are furnished to you pursuant to
Section 5.1(k) of the Credit Agreement. Unless otherwise defined herein, terms
defined in the Credit Agreement, and terms defined in the Uniform Commercial
Code of the State of California (the "UCC"), are used herein as therein defined.
SHEPPARD, MULLIN, XXXXXXX & XXXXXXX LLP
The Chase Manhattan Bank,
as Administrative Agent,
and each of the Lenders
August 7, 1996
Page 2
In connection with the opinions expressed below,
(a) we have examined and relied on copies, certified or otherwise
identified to our satisfaction, of each of (1) the Credit Agreement and (2) the
State Security Documents.
(b) we have examined unfiled copies of the financing statements
listed on Schedule 2 (collectively, the "Financing Statements") naming the
Borrower, C/M Products, Inc., a California corporation ("C/M Products"), or
Core-Xxxx Interrelated Companies, Inc., a California corporation ("CMIC"), as
Debtor and the Agent as Secured Party, which we understand will be filed in the
filing offices listed on Schedule 2 (the "Filing Offices");
(c) we have examined and relied on (i) copies of the articles of
incorporation of C/M Products and CMIC, each certified by the California
Secretary of State on August 5, 1996, (ii) certificates of status for C/M
Products and CMIC, each dated August 5, 1996, issued by the California Secretary
of State, and (iii) franchise tax board letters for C/M Products and CMIC, each
dated August 5, 1996, issued by the California Franchise Tax Board; and
(d) we have also examined such other documents as we have deemed
necessary or appropriate for the purpose of giving this opinion.
In rendering the opinions expressed below, we have assumed, with
your permission, without independent investigation or inquiry, (a) the
genuineness of all signatures, (b) the authenticity of all documents submitted
to us as originals and (c) the conformity to original documents of documents
submitted to us as certified, conformed or photostatic copies.
You have advised us that in rendering this opinion, we may assume
that (i) the Borrower is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware; (ii) Core-Xxxx
Midcontinent, Inc. ("CM Midcontinent") is a corporation duly organized, validly
existing and in good standing under the laws of the State of Arkansas; (iii) the
Borrower is duly qualified as a foreign corporation and is in good standing
under the laws of the State of California; (iv) the actions of each of the
Borrower, C/M
SHEPPARD, MULLIN, XXXXXXX & XXXXXXX LLP
The Chase Manhattan Bank,
as Administrative Agent,
and each of the Lenders
August 7, 1996
Page 3
Products, CMIC and CM Midcontinent are permitted under their respective
certificates of incorporation, bylaws and other organizational or governing
documents; (v) each of the Credit Agreement and the State Security Documents has
been duly authorized, executed and delivered by the respective parties thereto
in the form of the copies reviewed by us; (vi) except for C/M Products and CMIC,
none of the Subsidiaries either has its place of business or chief executive
office in the State, or owns any personal property that is located in the State;
(vii) with respect to patents, copyrights and trademarks covered by the Security
Agreement described in Item 2 on Schedule 1 attached hereto, the Agent has made
all filings in federal offices, and has taken all actions in jurisdictions other
than the State of California, necessary to effect any transfer of, or create or
perfect any interest in, any of the property described therein.
Based on the foregoing, we are of the opinion that:
1. C/M Products and CMIC (a) are each corporations duly organized,
validly existing and in good standing under the laws of the State of California,
and (b) each has the corporate power and authority to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged.
2. The execution, delivery and performance by C/M Products and CMIC
of the State Security Documents, and the creation and perfection of any security
interest upon or with respect to any of C/M Products' or CMIC's properties
provided for therein do not violate (a) the articles or incorporation of C/M
Products or CMIC or (b) any applicable law, statute, rule or regulation of the
State of California.
3. Except for the filings described on Schedule 2 to perfect the
security interests created by the Security Agreement, no consent or
authorization of, filing with, notice to or other act by or in respect of, any
Governmental Authority of the State of California is required in connection with
the execution, delivery or performance by the Borrower, C/M Products, CMIC or CM
Midcontinent of the State Security Documents, or the creation and perfection of
any security interest upon or with respect to any of the Borrower's, C/M
Products' or CMIC's properties provided for therein.
SHEPPARD, MULLIN, XXXXXXX & XXXXXXX LLP
The Chase Manhattan Bank,
as Administrative Agent,
and each of the Lenders
August 7, 1996
Page 4
4. (a) Insofar as the laws of the State of California apply, the
provisions of each State Security Agreement are effective to create in favor of
the Agent a legal, valid and enforceable security interest in the Collateral
described therein. (b) Upon the filing of the Financing Statements in the Filing
Offices, the Agent will have a perfected security interest in the Filing
Collateral. As used in this paragraph, "Filing Collateral" means (x) all
equipment and inventory located in the State of California other than (i) motor
vehicles or boats subject to the registration provisions of the California
Vehicle Code, (ii) mobile homes or commercial coaches subject to the
registration provisions of the California Health and Safety Code, (iii) any
vehicle or other item of tangible personal property subject to a registration or
certificate of title statute of a jurisdiction other than California, and (iv)
goods which are mobile and which are of a type normally used in more than one
jurisdiction; (y) all accounts (other than accounts resulting from the sale of
minerals or the like (including oil and gas) at the wellhead or minehead),
chattel paper (other than chattel paper in which the Lenders' interest is
perfected by possession under Section 9305 of the UCC) and general intangibles
(other than (i) uncertificated securities or (ii) any property subject to a
statute or treaty of the United States which provides for a national or
international registration or which specifies a place of filing different from
that specified in the UCC) of C/M Products and CMIC; and (z) all other
Collateral as to which filing UCC-l financing statements in the Filing Offices
is an appropriate method of perfection.
Our opinions set forth in paragraphs 1 and 2(a), above, are based
solely upon our review of (i) copies of the articles of incorporation of C/M
Products and CMIC, each certified by the California Secretary of State on August
5, 1996, (ii) certificates of status for C/M Products and CMIC, each dated
August 5, 1996, issued by the California Secretary of State, and (iii) franchise
tax board letters for C/M Products and CMIC, each dated August 5, 1996, issued
by the California Franchise Tax Board.
SHEPPARD, MULLIN, XXXXXXX & XXXXXXX LLP
The Chase Manhattan Bank,
as Administrative Agent,
and each of the Lenders
August 7, 1996
Page 5
Our opinions set forth in paragraph 4, above, are subject to the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and the implied covenant of good faith and fair dealing.
In giving the opinions set forth in paragraph 4, above, we advise
you that a California court may not strictly enforce certain covenants contained
in the State Security Documents or allow acceleration of the maturity of the
indebtedness secured by the State Security Documents if it concludes that such
enforcement or acceleration would be unreasonable under the then existing
circumstances. We do believe, however, that subject to the limitations expressed
elsewhere in this opinion, enforcement or acceleration would be available if an
Event of Default occurs as a result of a material breach of a material covenant
contained in the Credit Agreement or the State Security Documents.
We have not made or undertaken to make any investigation of the
state of title to the personal property described in the State Security
Documents, and we express no opinion with respect to the title thereto. We
understand that you are relying on your own examinations of title to personal
property. We express no opinion concerning the priority of any liens or security
interests in connection with the transaction.
Our opinions are based solely upon the existing laws of the State of
California , and we express no opinion as to the laws or regulations of any
jurisdiction other than the State of California which may be applicable to the
transaction or documents referred to herein. We are not admitted to practice law
in any states or jurisdictions other than the State of California.
SHEPPARD, MULLIN, XXXXXXX & XXXXXXX LLP
The Chase Manhattan Bank,
as Administrative Agent,
and each of the Lenders
August 7, 1996
Page 6
This opinion is rendered in connection with the transaction
contemplated by the Credit Agreement and the State Security Documents, and is
intended solely for your guidance in connection therewith. Our opinion speaks
only as of the date hereof. This opinion is not to be relied upon in any other
context, nor is it to be relied upon by any other person or entity for any
reason whatsoever.
Very truly yours,
/s/ Sheppard, Mullin, Xxxxxxx & Xxxxxxx LLP
SHEPPARD, MULLIN, XXXXXXX & HAMPTON LLP
SCHEDULE 1
STATE SECURITY DOCUMENTS
1. SUBSIDIARIES GUARANTEE dated as of August 7, 1996, executed by C/M
Products, CMIC and CM Midcontinent in favor of the Agent, as administrative
agent for itself and the other Lenders.
2. SECURITY AGREEMENT dated as of August 7, 1996, executed by the
Borrower, C/M Products, CMIC and CM Midcontinent in favor of the Agent, as
administrative agent for itself and the other Lenders.
Page 1 of 2
SCHEDULE 2
UCC-1 FINANCING STATEMENTS TO BE FILED WITH THE CALIFORNIA
SECRETARY OF STATE
1. UCC-1 financing statement executed by the Borrower, as debtor, for the
benefit of the Agent, as administrative agent for itself and the other
Lenders, as secured party.
2. UCC-1 financing statement executed by C/M Products, as debtor, for the
benefit of the Agent, as administrative agent for itself and the other
Lendors, as secured party.
3. UCC-1 financing statement executed by CMIC. as debtor, for the benefit
of the Agent, as adminstrative agent for itself and the other Lenders,
as secured party.
4. UCC-1 financing statement executed by CM Midcontinent, as debtor, for
the benefit of the Agent, as administrative agent for itself and the
other Lenders, as secured party.
5. UCC-1 financing statement executed by the Borrower under the name of
Core-Xxxx Distributors, Inc., the Borrower's former name, as debtor,
for the benefit of the Agent, as administrative agent for itself and
the other Lenders, as secured party.
Page 2 of 2
Exhibit J-3
[LETTERHEAD OF STOEL RIVES LLP]
August 7, 1996
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
Re: $210,000,000 Loan to Core-Xxxx International, Inc. By The Chase
Manhattan Bank, as Administrative Agent to the Lenders Under the
Credit Agreement Described Below
Dear The Chase Manhattan Bank and Lenders:
We have acted as special counsel to you (collectively "the Lenders") in
the state of Oregon (the "State") in connection with the transactions
contemplated by a Credit Agreement between The Chase Manhattan Bank, as
Administrative Agent for the Lenders and Core-Xxxx International, Inc.
("Borrower"), for certain loans in the aggregate principal amount of
$210,000,000 (the "Loans") to be made by the Lenders to the Borrower. This
opinion is furnished to you pursuant to Section 5.1(k) of the Credit Agreement.
DOCUMENTS AND DEFINITIONS
We have examined draft, unsigned execution copies of the Credit Agreement,
the Security Agreement and a Uniform Commercial Code UCC-1 financing statement
from Borrower (the "Financing Statement") (collectively, the "Loan Documents").
We also have examined a certificate from the Oregon Secretary of State relating
to the registration of Borrower as a foreign corporation, and we have relied on
that certificate as we have deemed appropriate. We have relied solely on the
foregoing documents and such other documents as referred to in this letter as to
all matters and facts covered therein. We have not undertaken any independent
verification or investigation of these factual matters, nor have we conducted or
reviewed searches of files of UCC financing statements or judgments. Capitalized
terms not defined in this Opinion shall have the respective meaning ascribed to
them in the Credit Agreement. "UCC" shall mean the Uniform Commercial Code as
currently in effect in the state of Oregon.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 2
ASSUMPTIONS
For purposes of this letter, we have assumed:
1. Conformity. The executed original Loan Documents will conform to the
draft execution copies submitted to us, and the signatures thereon will be
genuine.
2. Document Authenticity. The Loan Documents will be duly authorized,
executed and delivered by all the parties thereto other than the Borrower and
will constitute the legal, valid and binding and enforceable obligations of all
parties other than Borrower.
3. Lenders. The Lenders are duly organized and validly existing under the
laws of the states of their respective incorporation and are qualified to do
business in all states where the activities contemplated by the Loan Documents
require such qualification.
4, Borrower. The Borrower is a corporation duly incorporated and validly
existing under the laws of the state of Delaware. The Borrower has all requisite
corporate power and authority under the laws of the state of Delaware (i) to
execute and deliver, and to perform its obligations under and carry out the
transactions contemplated by, the Loan Documents to which it is party, (ii) to
own its properties, including, without limitation, the Collateral, and (iii) to
conduct its business as contemplated by the Loan Documents.
5. Authorization. Each of the Loan Documents to which the Borrower is a
party will be duly authorized by all necessary corporate action on the part of
the Borrower to the extent authorization is required as a condition to the
legality, validity, binding effect or enforceability of such Loan Document and
has been duly and properly executed and delivered by Borrower.
6. Performance. All conditions to the Borrower's and the Lenders'
performance set forth in the Loan Documents, whether performance or satisfaction
thereof is due before, on or after the date hereof, have been or will be fully
performed and satisfied at the respective times required by such documents or
have been or will be validly waived.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 3
7. Future Conduct. The Borrower will obtain all permits and governmental
approvals required in the future and take all actions similarly required for its
performance of the Loan Documents.
8. Title to Collateral. The Borrower holds the requisite title to the
Collateral.
9. Property Title and Description. The descriptions of personal property
in the pertinent Loan Documents are sufficient to create a lien or security
interest under the pertinent security documents and to enable identification by
a subsequent purchaser, secured party or creditor.
10. Indexing. The Financing Statement will be filed with and properly
indexed by the Oregon Secretary of State.
11. Use of Loan Proceeds. No portion of the loans will be used for the
"purpose of purchasing or carrying" any "margin stock" or "margin security" as
such terms are used in Regulations G, U and X of the Board of Governors of the
Federal Reserve System or otherwise in violation of such regulations.
12. Attachment. The Borrower has "rights" in all of the Collateral capable
of being pledged and has received "value" within the meaning of ORS 79.2030.
13. Good Faith. The transaction has been entered into by all of the
parties in good faith within the meaning of ORS 71.2030, and the conduct of all
parties has conformed and will conform with all applicable express and implied
covenants of good faith and fair dealing and the requirements of
conscionability.
14. Enforceability Under Other Laws. Each of the Loan Documents, to the
extent governed by the laws of any state other than the state of Oregon, is
legal, valid, binding and enforceable in accordance with the laws of such other
state.
15. No Notice of Defenses. The Lenders and any agents acting for them in
connection with the Loans have acted in good faith and without notice of any
defense against the enforcement of any rights created by the Loan Documents.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 4
16. Laws of Other States. The performance by the parties of their
respective obligations under the Loan Documents do not and will not contravene
or conflict with any law, rule or regulation of any jurisdiction other than the
State, or any judgment, order or decree of any court or regulatory body
applicable to the parties or by which the parties may be bound, and do not
conflict with or constitute on the part of the Borrower a violation of, breach
of or default under any agreement or other instrument to which the Borrower is a
party or by which it is bound.
17. Location. The Loans are being made, funded and closed in New York, the
Loan Documents have been primarily negotiated in New York and have been executed
and delivered by the parties in New York, amounts due under the Loans are
intended to be paid in New York, and the chief executive office and principal
place of business of Borrower is in California. The interest and other charges
payable by the Borrower under the Loan Documents are lawful in the state of New
York.
18. Collateral. The Collateral does not include timber to be cut, minerals
or the like (including oil and gas), accounts subject to ORS 79.1030(5) or
minerals, and goods that are or are to become fixtures. The inventory is not
held in Oregon by a third party bailee or warehouseman under a negotiable
document of title.
We have not conducted an independent investigation with respect to these
assumptions although we have no knowledge that these assumptions are incorrect.
We have not conducted any investigation as to any transaction, including those
contemplated by the Loan Documents. For the purpose of this opinion, our
"knowledge" is limited to the current actual knowledge (and not constructive,
implied or imputed knowledge) of the attorneys in our firm acquired who
participated in the preparation of this opinion without independent inquiry,
investigation or review of the Collateral or any files or public or private
records. We understand that you will rely solely on separate opinions furnished
to you by other counsel should you desire assurances regarding these matters.
OPINIONS
Based upon the foregoing review and assumptions, and subject to the
qualifications, exclusions and limitations below, we are of the opinion that
under the applicable state law in effect in Oregon on the date of this opinion:
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 5
1. The Borrower is authorized to transact business as a foreign
corporation in Oregon.
2. The execution and delivery by the Borrower of the Loan Documents to
which the Borrower is a party, and the consummation by the Borrower and the
Lenders of the transactions contemplated thereby, will not violate any law, rule
or regulation of Oregon.
3. Subject to the assumptions and qualifications to the opinions expressed
herein, no authorization or approval or other action by, and no notice to any
governmental or quasi-governmental authority or regulatory body of the State is
required for (a) the due execution, delivery, recordation, filing or performance
by the Borrower of the Loan Agreements, (b) the grant by the Borrower of the
liens or security interests granted by it pursuant to the Security Agreement,
(c) the perfection or maintenance of the security interests created by the
Security Agreement in that collateral that can be perfected by a UCC financing
statement, or (d) the exercise by the Administrative Agent or any Lender of its
rights under the Loan Documents or the remedies in respect of the Collateral
pursuant to the Security Agreement, except (i) that the exercise of certain
remedies may require prior court approvals, filings or notice, and (ii) in the
case of clause (c) above, the matters referred to in paragraphs 5 and 6 below.
4. The Security Agreement creates in favor of the Administrative Agent as
secured party, for the benefit of the Administrative Agent and the Lenders,
valid security interests in all Collateral located in Oregon as collateral
security for the payment of the obligations under the Loan Documents.
5. The Financing Statement is in proper form so as to comply with the
filing requirements of Oregon. Assuming the proper execution and delivery of the
Security Agreement, upon filing of the Financing Statement in the office of the
Oregon Secretary of State with the applicable filing fee, the Administrative
Agent will have a valid and perfected security interest in the Inventory of the
Borrower located in the State subject to the provisions of ORS 79.1030, and in
any other Collateral referred to therein located in the State to which Article 9
of the Uniform Commercial Code, as in effect in the State (the "UCC"), is
applicable and to the extent a security interest can be perfected by filing in
the office of the Secretary of State a financing statement under the UCC. We
advise you that:
(a) UCC continuation statements must be filed with respect to the
Financing Statement in the same office in which the Financing Statement
was
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 6
originally filed within six months before the expiration of each
consecutive five-year period (with the first such period commencing on the
date such Financing Statement was originally filed and recorded);
(b) Section 552 of the Bankruptcy Code limits the extent to which
certain property acquired by a debtor after the commencement of a
bankruptcy case under the Bankruptcy Code may be subject to a security
interest arising from a security agreement entered into by the debtor
before the commencement of that case;
(c) The perfection of the security interests perfected by the filing
of a fmancing statement in the state of Oregon will be terminated as to
any Collateral acquired by the Borrower more than four months after the
Borrower so changes its name, identity or corporate structure as to make
the respective Financing Statement seriously misleading, unless new
appropriate UCC financing statements indicating the new name, identity or
corporate structure of the Borrower are properly filed before the
expiration of such four months;
(d) Actions other than the filing of a UCC financing statement are
necessary to perfect a security interest in certain types of personal
property (including deposit accounts; instruments; permits; licenses;
property subject to state, federal or international registration;
intellectual property; insurance; motor vehicles; watercraft; and
manufactured housing);
(e) ORS 79.3060 limits the right of a secured party to perfect a
security interest in the proceeds of the collections from any of the
Collateral that is the type of collateral subject to a security interest
under Article 9 of the UCC. In the case of noncash proceeds that do not
constitute part of the Collateral subject to the Loan Documents and in the
case of nonidentifiable cash proceeds, continuation of the perfection of
the security interest is also limited to the extent set forth in ORS
79.3060; and
(f) Under ORS 79.3070, .3080 and.3090, certain purchasers of the
Collateral may take the same free and clear of the Security Documents and
the security interests granted therein.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 7
(g) We express no opinion regarding any requirements to file in any
other state, nor as to perfection with respect to intellectual property,
including without limitation any requirement to file under any nation-wide
system for the perfection of security interests in intellectual property.
To the extent that a security interest in intellectual property can be
perfected by filing a UCC financing statement in Oregon, the Office of the
Secretary of State is the appropriate office.
(h) In the case of inventory or other goods held for the benefit of
the Borrower by a third-party bailee or warehouseman, perfection of the
security interest in the goods may be had by filing only if the interest
in the applicable document of title, if negotiable, is perfected by an
applicable UCC filing adequately describing the document of title or
possession of the document of title, and if the document of title is not
negotiable, by (i) filing an applicable UCC financing statement as to the
goods, or (ii) receipt by the bailee or warehouseman of notice of the
secured party's interest, or (iii) possessing the document of title issued
in the name of the secured party.
6. Each of the Loan Documents is the legal, valid and binding obligation
of the Borrower, enforceable against the Borrower in accordance with its terms.
QUALIFICATIONS
The opinions expressed above are subject to the following qualifications:
1. The enforcement of the Loan Documents will be subject to certain
limitations imposed by general principles of equity and by statutes and judicial
decisions that limit or prohibit enforcement which would violate the implied
covenant of good faith and fair dealing or would be commercially unreasonable.
2. Certain procedural requirements, such as the required format and timing
of service of process, court filings, recordation and notices, must meet the
minimum statutory requirements. Other rights and obligations are subject to
limitations or restrictions imposed by statute. By way of example only, you are
advised that any provision in the Loan Documents requiring a party to pay the
attorneys' fees and costs of another party in actions to enforce the provisions
thereof will be construed to entitle the prevailing party in any action to be
awarded its costs and reasonable attorneys' fees.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 8
3. With respect to our opinions in paragraphs 4 and 6, (a) the
enforceability of the Loan Documents may be limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium or similar laws, or by equitable
principles (regardless of whether such enforcement is considered in a proceeding
in equity or at law) relating to or limiting the rights of creditors generally,
and (b) the use of the term "enforceable" shall not imply any opinion as to the
availability of equitable remedies other than the foreclosure of the liens
created by the Loan Documents in accordance with Oregon law. Further, a court of
the State may not strictly enforce certain provisions contained in the Loan
Documents or allow acceleration of the maturity of the indebtedness if it
concludes that such enforcement or acceleration would be unreasonable under
circumstances then existing. We do believe, however, that subject to limitations
expressed elsewhere in this opinion, enforcement or acceleration against the
Borrower would be available if an event of default occurs as a result of a
material breach of a material provision contained in the Loan Documents.
The following list is not a complete recitation of matters as to which no
opinion is expressed, but we wish to emphasize specifically that we express no
opinion as to the enforceability of (i) self-help, rights of set off or the
right to possession of the personal property or collection of rental or other
income without appointment of a receiver or the rights, procedural requirements
for or powers of a receiver; (ii) provisions purporting to establish evidentiary
standards; (iii) provisions related to the waiver of rights, remedies and
defenses; (iv) provisions that permit the Lenders to collect a late charge,
increased interest rate after default or maturity or a prepayment premium to the
extent such amount exceeds actual damages; (v) any reservation of the right to
pursue inconsistent or cumulative remedies; (vi) any "due on encumbrance" clause
in any circumstance where the security for the loan would not be impaired; (vii)
provisions for payment or reimbursement of costs and expenses or indemnification
for claims, losses or liabilities (including, without limitation, attorneys'
fees) in excess of statutory limits or an amount determined to be reasonable by
any court or other tribunal and any provision for attorneys' fees other than to
the prevailing party; (viii) provisions pertaining to jurisdiction or venue;
(ix) provisions purporting to appoint the Administrative Agent or a Lender as
attorney-in-fact for the Borrower; (x) limitations on the liability of the
Administrative Agent or a Lender, or for indemnification of same, for its own
negligence or misconduct; (xi) provisions that purport to establish or maintain
priority of the lien or security interest; (xii) provisions purporting to allow
the Administrative Agent to determine the method or order of sale of property in
a foreclosure action; and (xiii) any disclaimer of liability under environmental
laws.
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 9
4. Our opinions set forth in paragraphs 4 and 5 above are subject to the
further qualifications that we express no opinion as to the validity or
perfection of the security interests referred to in paragraphs 4 and 5 above as
they relate to any interest in or claim under any policy of insurance, except a
claim to the proceeds payable by reason of loss or damage under insurance
policies maintained by the Borrower with respect to Collateral as required by
and in compliance with the Security Agreement.
5. Our opinion with respect to the perfection and maintenance of
perfection of security interests under the UCC is not to be construed as
applying (i) to the creation or perfection of any security interest in any
"security," as defined in the UCC, or (ii) to the laws of any jurisdiction other
than the State that may govern the creation or perfection of any security
interest in any of the Collateral. A perfected security interest in certain
tangible Collateral may become unperfected if it is removed from the State.
6. Under Oregon law, the interpretation of any contract is based on the
intent of the parties and evidence extrinsic to a contract may be introduced to
ascertain the intent of the parties regardless of the presence or absence of
ambiguity and regardless of a statement by the parties that the written
agreement constitutes an integrated expression of their agreement. We expressly
disclaim any knowledge of the intent of the parties not expressed in the words
used in the Loan Documents. This opinion is expressly qualified to the extent
that determination of the intent of the parties based on evidence other than the
words used in the Loan Documents would lead to a result differing from our
opinion.
EXCLUSIONS
1. We express no opinion regarding the priority of any lien or security
interest.
LIMITATIONS
The opinions expressed in this Opinion are limited to matters governed by
the substantive laws of the State (excluding the laws of any other jurisdiction
that may be applicable under choice or conflicts of laws, rules or principles of
the State), in each case as in effect on the date of this letter, and we express
no opinion as to the law of any other state or jurisdiction. We undertake no
obligation to update or supplement this Opinion in response to subsequent
changes in the law or facts or future events. This Opinion is limited to the
specific
STOEL RIVES LLP
To The Chase Manhattan Bank and
the Lenders Who Are a Party to the
Credit Agreement Referred to Below,
Acting by and Through The Chase Manhattan
Bank, As Administrative Agent
August 7, 1996
Page 10
transactions, documents and matters described above, and no opinions may be
implied or inferred beyond those that are expressly stated in this letter.
This Opinion may not be relied upon by any person other than the
addressees named in this letter and any permitted participant under the Credit
Agreement, and no person may be subrogated to the rights of the addressees. This
Opinion is provided to you solely for the purpose of complying with the
requirements of Section 5.1(k) of the Credit Agreement and, without our prior
written consent, may not be quoted in whole or in part or otherwise referred to
in (or be the basis for) any report or document furnished to any person or
entity, except in connection with the inspection of your files by internal or
governmental examiners or auditors.
Very truly yours,
/S/ Stoel Rives LLP
Stoel Rives LLP
Exhibit J-4 (1)
[LETTERHEAD OF STIKEMAN, XXXXXXX]
August 7, 1996
TO THE PERSONS IDENTIFIED IN
SCHEDULE A TO THIS LETTER
Dear Sirs:
Re: Security Interest granted in favour of
The Chase Manhattan Bank by Core-Xxxx International, Inc.,
CIM Products, Inc., Core-Xxxx Interrelated Companies, Inc.
and Core-Xxxx Midcontinent. Inc.
----------------------------------------------------------------
We have acted as local agent for Core-Xxxx International, Inc., CIM
Products, Inc., Core-Xxxx Interrelated Companies, Inc. and Core-Xxxx
Midcontinent, Inc. (collectively, the "Debtors" and each individually being a
"Debtor") in connection with the registration under the Personal Property
Security Act (Alberta), as amended (the "PPSA"), of a financing statement in
respect of a security interest created under a security agreement (the "Security
Agreement") dated August 7, 1996 granted in favour of The Chase Manhattan Bank,
as Administrative Agent (the "Lender") by each of the Debtors.
Scope of Examination
We have examined a copy identified to our satisfaction of the
Security Agreement.
We have also examined originals or copies of such records,
certificates or other documents and have considered such questions of law as we
have considered relevant and necessary as a basis for the opinions hereinafter
expressed.
Assumptions
In rendering the opinions expressed below we have, without
independent inquiry, assumed:
STIKEMAN, XXXXXXX
2
1. and relied upon the genuineness of all signatures (whether on
originals or copies of documents), the authenticity of all documents
submitted to us as originals the conformity to the original
documents of all documents submitted to us as notarial, certified,
conformed, photostatic or telecopied copies thereof and the
authenticity of the originals of such documents;
2. the name and address of each of the Debtors is at all relevant times
as set forth in Schedule C hereto;
3. that the name and address of the lender is at all relevant times as
set forth in Schedule C hereto;
4. that each of the parties to the Security Agreement has all requisite
power and authority to execute and deliver the Security Agreement
and to perform its obligations thereunder;
5. that the Security Agreement has been duly authorized, executed and
unconditionally delivered by each of the parties thereto and
constitutes a legal, valid and binding obligation enforceable
against the parties in accordance with its terms;
6. that the personal property subject to the security interest
expressed to be created under the Security Agreement (the
"Collateral") is accurately described in the Security Agreement;
7. that value has been given and each of the Debtors has rights in the
Collateral such that attachment (as that term is used in the PPSA)
of the security interest in the Collateral expressed to be created
under the Security Agreement has occurred;
8. that the parties to the Security Agreement have not specifically
agreed in writing to postpone the time for attachment of the
security interest in the Collateral expressed to be created under
the Security Agreement;
9. that the Collateral does not include "serial number goods" as
defined in Alberta Regulation 234/90 made pursuant to the PPSA,
being a motor vehicle, a trailer, a mobile home, an aircraft, a boat
or an outboard motor for a boat; and
10. that the Collateral does not include property in which a security
interest may not be perfected by the filing of a financing statement
under the PPSA, such as, but without limitation, contracts of
annuity or policies of insurance (except money or other value
payable under a policy of insurance as indemnity or compensation for
loss of or damage to the Collateral), interests in land (including a
lease), interests
STIKEMAN, XXXXXXX
3
in rights to payment in connection with an interest in lands
(including rental payments), and rights to damages in tort.
In addition we have assumed and relied upon the accuracy of the
search results and verification statements issued by the Personal Property
Registry (Alberta). In providing the opinion set forth in paragraph 1 under the
heading "Opinions" we have relied solely on a Certificate of Status respecting
Core-Xxxx International, Inc. issued by the Registrar of Corporations (Alberta)
and dated August 6, 1996, a copy of which is attached hereto as Schedule B.
Subject Laws
Our opinions expressed herein are limited to the laws of the
Province of Alberta and federal laws of Canada applicable therein and we express
no opinion with respect to the laws of any other jurisdiction. For the purposes
of the PPSA the validity, perfection and effect of perfection or non-perfection
of a security interest in intangibles (which includes accounts receivable) is
governed by the law of the jurisdiction where the debtor is located at the time
the security interest attaches. Under the PPSA, a debtor is deemed to be located
at the debtor's place of business if there is one, at the debtor's chief
executive office if there is more than one place of business, and otherwise at
the debtor's principal place of residence.
Searches
At your request, we have conducted or arranged to be conducted
searches in certain public registry or filing offices in the Province of Alberta
which may disclose any other interests in the Collateral. The results of those
searches have been provided under separate cover.
Registrations
On August 6, 1996 we attended to registration of a financing
statement (the "Financing Statement") in respect of the security interest
expressed to be granted to and created in favour of the lender under the
Security Agreement, which registration is described in Schedule C hereto. In
accordance with your instructions that registration has been made for a term of
ten (10) years and unless the obligations secured by the security interest
expressed to be created by the Security Agreement have been fulfilled within
that period of time, renewal of that Financing Statement prior to its expiry on
August 6, 2006 will be required.
STIKEMAN, XXXXXXX
4
Renewals
Our firm maintains no record of the dates of registration of
financing statements and we have no reminder system for that purpose;
accordingly, we take no responsibility for the registration of renewals or
amendments .
Opinions
Subject to the assumptions set forth above and the qualifications
hereinafter expressed, we are of the opinion that:
1. Core-Xxxx International, Inc. is a valid and subsisting
extra-provincial corporation under the Business Corporations Act
(Alberta) .
2. The Security Agreement creates a valid security interest in that
Collateral the validity of a security interest in which is governed
by the PPSA.
3. The security interest created under the Security Agreement in that
Collateral, the perfection of a security interest in which is
governed by the PPSA, has been duly perfected by registration under
the PPSA.
4. No other notice, registration or act is necessary in the Province of
Alberta to perfect under the PPSA the security interests created
under the Security Agreement .
Qualifications
The opinions expressed herein are based on and subject to the
following qualifications:
1. we express no opinion as to title of the Collateral;
2. we express no opinion as to the rank or priority of any charge on or
security interest in the Collateral, including that expressed to be
created under the Security Agreement;
3. to the extent that the PPSA is applicable, the obligations of an
account debtor in respect of an intangible or chattel paper assigned
under the Security Agreement to make payment to the secured party
are subject to Section 41 of the PPSA which requires, inter alia,
that the account debtor receive notice regarding the assignment as
stipulated in Section 41(5) of the PPSA;
STIKEMAN, XXXXXXX
5
4. we express no opinion as to any recordings, filings, indexing,
entering or registrations which may be necessary in respect of: (i)
any interest in real or immovable property; (ii) any debt owing by
the Crown in right of Canada or Alberta or any agency thereof; (iii)
any permit, license or authorization, the transfer or assignment of
which is specifically regulated by any statute or regulation of
Alberta; (iv) debts, claims, demands and other rights the assignment
of which is subject to certain conditions or is specifically
regulated by any statute or regulation of Alberta; (v) ships (which
are registered under the Canada Shipping Act), rolling stock,
trademarks, patents, copyrights or industrial designs; or (vi)
property to which the PPSA does not apply;
5. under the PPSA, the failure to register by serial number in respect
of certain kinds of collateral (itinerant collateral such as motor
vehicles, trailers, mobile homes, aircraft and boats) not held by
the debtor as inventory may result in the secured party not having
priority over certain third parties in relation to such collateral.
As no registration by serial number has been effected in respect of
such kinds of assets which now or may hereafter form part of the
Collateral, this opinion is qualified to the extent that such serial
number registration may be necessary or desirable.
This opinion has been delivered to you in connection with the
registration of the security interest created under the Security Agreement in
the Province of Alberta. Without our prior consent, this opinion may not be
relied upon by you for any other purposes or in connection with any other
transaction, be relied upon by any other party other than the addressees nor
quoted in whole or in part.
Yours very truly,
/s/ Stikeman, Xxxxxxx
EXHIBIT K TO
CREDIT AGREEMENT
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of August 7, 1996
(as amended, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among Core-Xxxx International, Inc. (the "BORROWER"),
the Lenders named therein and The Chase Manhattan Bank, as administrative agent
for the Lenders (in such capacity, the "ADMINISTRATIVE AGENT"). Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.
The Assignor identified on Schedule l hereto (the "ASSIGNOR") and the
Assignee identified on Schedule l hereto (the "ASSIGNEE") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably
purchases and assumes from the Assignor without recourse to the Assignor, as
of the Effective Date (as defined below), the interest described in Schedule 1
hereto (the "Assigned Interest") in and to the Assignor's rights and
obligations under the Credit Agreement with respect to those credit facilities
contained in the Credit Agreement as are set forth on Schedule 1 hereto
(individually, an "Assigned Facility"; collectively, the "Assigned
Facilities"), in a principal amount for each Assigned Facility as set forth on
Schedule 1 hereto.
2. The Assignor (a) 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 with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement, any other Loan Document or any other
instrument or document furnished pursuant thereto, other than that the
Assignor has not created any adverse claim upon the interest being assigned
by it hereunder and that such interest is free and clear of any such adverse
claim; (b) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower, any of its
Subsidiaries or any other obligor or the performance or observance by the
Borrower, any of its Subsidiaries or any other obligor of any of their
respective obligations under the Credit Agreement or any other Loan Document
or any other instrument or document furnished pursuant hereto or thereto;
(c) attaches any Notes held by it evidencing the Assigned Facilities and
(i) requests that the Administrative Agent, upon request by the Assignee,
exchange the attached Notes for a new Note or Notes payable to the Assignee
and (ii) if the Assignor has retained any interest in the Assigned Facility,
requests that the Administrative Agent exchange the attached Notes for a new
Note or Notes payable to the Assignor, in each case in amounts which reflect
the assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date); and
(d) represents and warrants that it has complied with all of the provisions of
Section 10.6(c) of the Credit Agreement which are applicable to it in
connection with this Assignment.
3. The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received a copy of the
2
Credit Agreement, together with copies of the financial statements
delivered pursuant to subsection 4.1 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it
will, independently and without reliance upon the Assignor, the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; (d) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to
exercise such powers and discretion under the Credit Agreement, the other
Loan Documents or any other instrument or document furnished pursuant hereto
or thereto as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are incidental thereto; (e) agrees that it will
be bound by the provisions of the Credit Agreement and will perform in
accordance with its terms all the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender including, if
it is organized under the laws of a jurisdiction outside the United States,
its obligation pursuant to subsection 2.19(b) of the Credit Agreement; and
(f) represents and warrants that it has complied with all of the provisions
of Section 10.6 (c) of the Credit Agreement which are applicable to it in
connection with this Assignment.
4. The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the "Effective
Date"). Following the execution of this Assignment and Acceptance, it will be
delivered to the Administrative Agent for acceptance by it and recording by
the Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of
such acceptance and recording by the Administrative Agent).
5. Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to the Effective Date
and to the Assignee for amounts which have accrued subsequent to the Effective
Date. The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Administrative Agent for periods prior to the Effective Date
or with respect to the making of this assignment directly between themselves.
6. From and after the Effective Date, (a) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder and
under the other Loan Documents and shall be bound by the provisions thereof
and (b) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under
the Credit Agreement.
7. This Assignment and Acceptance shall be governed by and construed
in accordance with the laws of the State of New York.
3
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their
respective duly authorized officers on Schedule 1 hereto.
Schedule 1
to Assignment and Acceptance
Name of Assignor:
----------------------------------
Name of Assignee:
----------------------------------
Effective Date of Assignment:
----------------------
Credit Principal
Facility Assigned Amount Assigned Commitment Percentage Assigned (1)
----------------- --------------- ----------------------------------
$ %
--------- ---------
[Name of Assignee] [Name of Assignor]
By: By:
------------------------ ------------------------
Name: Name:
Title: Title:
-------------------
(1) Calculate the Commitment Percentage that is assigned to at least 15 decimal
places and show as a percentage of the aggregate commitments of all Lenders.
2
Accepted: Consented To:
THE CHASE MANHATTAN BANK, as CORE-XXXX INTERNATIONAL, INC.(2)
Administrative Agent
By: By:
-------------------------- -----------------------------
Name: Name:
Title: Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent
By:
---------------------------------
Name:
Title:
CHASE MANHATTAN BANK
DELAWARE, as Issuing Bank
By:
---------------------------------
Name:
Title:
-------------------
(2) The consents of the Borrower, the Administrative Agent and the Issuing Bank
are not required unless the assignee is not an existing Lender under the
Credit Agreement.
STIKEMAN, XXXXXXX
SCHEDULE A
ADDRESSEES
Core-Xxxx International, Inc.
C/M Products, Inc.
Core-Xxxx Interrelated Companies, Inc.
Core-Xxxx Midcontinent, Inc.
Xxxxxxx Xxxxxxx & Xxxxxxxx
The Xxxxx Manhattan Bank
The other Lenders party to the Credit Agreement dated August 7, 1996 among
Core-Xxxx International, Inc., The Chase Manhattan Bank and those Lenders
STIKEMAN, XXXXXXX
SCHEDULE B
CERTIFICATE OF STATUS
================================================================================
Alberta Corporate Access Number
GOVERNMENT OF ALBERTA 21670091
CERTIFICATE OF STATUS
Form 32
I CERTIFY THAT ACCORDING TO OUR RECORDS
CORE-XXXX INTERNATIONAL, INC.
JURISDICTION: DELAWARE
REGISTERED IN ALBERTA ON 95/09/28
IS AS OF THIS DATE A VALID AND SUBSISTING EXTRA-PROVINCIAL CORPORATION
GIVEN UNDER MY HAND AND XXXX XX XXXXXX XX XXX XXXXXXXX XX XXXXXXX.
DATED: 96 AUG 06
[Seal]
/s/ [Illegible]
Registrar of Corporations
================================================================================
STIKEMAN, XXXXXXX
SCHEDULE C
REGISTRATION PARTICULARS
A Financing Statement was registered at Personal Property Registry (Alberta) in
respect of the Security Agreement on August 6, 1996. Particulars of the
Registration are as follows:
(a) Registration #: 96080616228
(b) Expiry Date: August 6, 2006
(c) Name and Address of each Debtor: Core-Xxxx International, Inc.
000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
C/M Products, Inc.
000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Core-Xxxx Interrelated Companies, Inc.
000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Core-Xxxx Midcontinent, Inc.
000 Xxxxxx Xxxxx Xxxxxxxxx, Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
(d) Secured Party's Name: The Chase Manhattan Bank
(e) Secured Party's Address: 000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx
00000
(f) Collateral Description: All of the Debtor's present and after
acquired personal property
Exhibit J-4(2)
[LETTERHEAD OF STIKEMAN, XXXXXXX]
FILE NO. 00010-046
August 7, 1996
The Chase Manhattan Bank and the
Lenders (as hereinafter defined)
000 Xxxxxxx Xxxxxxxxxx
Xxxxxxx, Xxx Xxxx
00000
and
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx
00000-0000
Dear Sirs:
Re: Security granted by Core-Xxxx International, Inc.
------------------------------------------------------
We have acted on your behalf as special British Columbia counsel in
connection with a security agreement granted pursuant to a credit agreement made
as of August 7, 1996 (the "Credit Agreement") between The Chase Manhattan Bank
(the "Agent") as agent bank and the lenders (collectively, the "Lenders") party
thereto as lenders and Core-Xxxx International, Inc. ("Core-Xxxx"), C/M
Products, Inc., Core-Xxxx Interrelated Companies, Inc. and Core-Xxxx
Midcontinent, Inc. (which, together with Core-Xxxx are collectively referred to
as the "Borrowers").
In connection with this transaction, we have reviewed a security agreement
dated as of August 7, 1996 (the "Security Agreement") granted by the Borrowers
in favour of the Agent.
We have examined originals, or copies certified or otherwise identified to
our satisfaction, of certificates of governmental officials, documents and such
other material as we have considered necessary or appropriate for the purposes
of this opinion. In such
STIKEMAN, XXXXXXX
-2-
examination we have assumed that all signatures are genuine, all documents
submitted to us as originals are authentic and all photostatic, certified,
notarial or other copies conform to the originals.
For the purposes of this opinion, we have assumed that:
(i) the Borrowers have been duly incorporated and are validly existing
corporations in good standing under the laws of their respective
jurisdictions of incorporation and that the Borrowers have all
corporate power and authority to own property and carry on business;
(ii) the Borrowers have the corporate power and capacity to execute and
deliver the Security Agreement; and
(iii) the Security Agreement has been duly and validly authorized,
executed and delivered to the Agent by the Borrowers.
We have conducted or arranged for certain searches and registrations
against the name of the Borrower in certain offices of public record in the
Province of British Columbia. The results of the searches and registrations are
set out in Schedule A to this opinion.
The opinions expressed herein relate only to the laws of the Province of
British Columbia and the laws of Canada applicable therein. No opinions are
expressed herein with respect to the laws of any other jurisdiction.
For the purposes of the Personal Property Security Act (British Columbia)
(the "PPSA"), the validity, perfection and effect of perfection or
non-perfection of a security interest in intangibles (which includes accounts
receivable) is governed by the law of the jurisdiction where the debtor is
located at the time the security interest attaches. Under the PPSA, a debtor is
deemed to be located at the debtor's place of business if there is one, at the
debtor's chief executive office if there is more than one place of business, and
otherwise at the debtor's principal place of residence. It is our understanding
that you have made appropriate personal property security registrations in the
jurisdiction where the Borrower maintains their chief executive offices.
Based upon and subject to the foregoing and the qualifications below, we
are of the opinion that, on the date hereof:
1. Core-Xxxx is duly registered as an extra-provincial corporation with
the Registrar of Companies for the Province of British Columbia and
is duly qualified to carry on business under the Company Act British
Columbia).
STIKEMAN, XXXXXXX
-3-
2. The Security Agreement creates a valid security interest in the
Collateral (as defined in the Security Agreement) to which the
Personal Property Security Act (British Columbia) applies. No other
notice, filing, registration or act is necessary in the Province of
British Columbia to perfect the security interest created by the
Security Agreement.
The foregoing opinions are subject to the following qualifications:
(a) we express no opinion as to the rank or priority of any security
interest in personal property;
(b) we express no opinion as to the accuracy of the description of any
of the property charged by the Security Agreement or as to the
ownership of or title to any of the property charged by the Security
Agreement;
(c) we express no opinion as to the creation or perfection of the
security interest, nor have we effected registrations, filings or
searches in any office of public record, with respect to:
(i) any Collateral which is now or hereafter becomes a fixture or
crop;
(ii) any Collateral that is serial numbered goods, as defined in
the PPSA;
(iii) any Collateral of a nature described in subsections (c), (d),
(e), (f), (g), (1) or (1) of Section 4 of the PPSA, a copy of
which Section is attached hereto;
(iv) any Collateral to the extent that security agreements with
respect to such Collateral are governed by the provisions of
an Act of the Parliament of Canada including, without
limitation, any vessel registered under the Canada Shipping
Act and any patents, trademarks and other intellectual
property rights;
(v) any Collateral for which, pursuant to applicable conflicts
rules (including without limitation the conflicts rules of the
PPSA), the validity, perfection and the effect of perfection
are governed by the laws of a jurisdiction other than British
Columbia;
(vi) any Collateral being proceeds which are not identifiable or
traceable; and
(vii) permits, quotas or other property which is not personal
property;
STIKEMAN, XXXXXXX
-4-
(d) to the extent that the PPSA is applicable, the obligation of an
account debtor under an intangible or chattel paper assigned to make
payments to the assignee thereunder is subject to section 41(7) of
the PPSA which requires, inter alia, that the account debtor receive
the notice regarding the assignment stipulated in section 41(7);
(e) to the extent that the Financial Administration Act (Canada) (the
"FAA") is applicable, the obligation of the Crown to make payment of
a Crown debt (as defined in Part VII of the FAA) requires, inter
alia, that the assignment is absolute and that the Crown receive
notice of the assignment in the form and manner stipulated in
section 69 of the FAA;
(f) the requirement to re-register or amend the existing registration in
certain instances pursuant to the provisions of the PPSA in order to
maintain the perfection of the security interest; and
(g) we express no opinion as to the creation of the security interest
with respect to:
(i) any contractual rights which by their terms; or
(ii) any Collateral which by its nature,
cannot be the subject of a security interest without consent,
authorization or approval of third parties.
This opinion is solely for the benefit of the addressees in connection
with the Credit Agreement and is not for the benefit of any other person or
entity. This opinion letter may not be relied upon by, quoted, in whole or in
part, or otherwise referred to, used or disclosed to, anyone else or used for
any other purpose, without our prior written consent.
Yours truly,
/s/ Stikeman, Xxxxxxx
1989 PERSONAL PROPERTY SECURITY SBC CHAP. 36
INDEX CHAP. 321.5
Exclusions from scope of Act
4. Except as otherwise provided in this Act, this Act does not apply to
the following:
(a) a lien, charge or other interest given by a rule of law or by
an enactment unless the enactment contains an express
provision that this Act applies;
(b) a security agreement governed by an Act of the Parliament of
Canada that deals with rights of parties to the agreement or
the rights of third parties affected by a security interest
created by the agreement, including but without limiting the
generality of the foregoing
(i) a mortgage under the Canada Shipping Act, and
(ii) any agreement governed by Part V, Division B of
the Bank Act (Canada);
(c) the creation or transfer of an interest or claim in or under a
contract of annuity or policy of insurance except the transfer
of a right to money or other value payable under a policy of
insurance as indemnity or compensation for loss of or damage
to collateral;
(d) the creation or transfer of an interest in present or future
wages, salary, pay, commission or any other compensation for
labour or personal services other than fees for professional
services;
(e) the transfer of an interest in an unearned right to payment
under a contract to a transferee who is to perform the
transferor's obligations under the contract;
(f) the creation or transfer of an interest in land, other than an
interest arising under a licence, including
(i) a lease,
(ii) [Repealed 1990-11-3 (b).]
(iii) a petroleum and natural gas lease under the
Petroleum and Natural Gas Act,
(iv) a lease, issued under the Coal Act, that confers
the right to produce coal, or
(v) any similar interest that is prescribed for the
purposes of this section;
(g) the creation or transfer of an interest in a right to payment
that arises in connection with an interest in land, including
an interest in rental payments payable under a lease of land;
(h) a sale of accounts or chattel paper as part of a sale of a
business out of which they arose unless the vendor remains in
apparent control of the business after the sale;
(i) a transfer of accounts made solely to facilitate the
collection of the accounts for the assignor;
(j) the creation or transfer of an interest in a right to damages
in tort;
(k) an assignment for the general benefit of creditors made in
accordance with an Act of the Parliament of Canada relating to
insolvency;
(l) a mineral claim or a placer claim as those terms are defined
in the
Mineral Tenure Act.
1989-36-4; 1990-11-3.
SCHEDULE A
[Letterhead of Province of British Columbia]
------------------------------------------------------------------------------
BC Online: PPRS SEARCH RESULT
------------------------------------------------------------------------------
Date: AUG 06, 1996 Currency Date: JUL 31 1996 Page: 1
Time: 11:44:07 Clerk: PE12804
Searching Party:
STIKEMAN, XXXXXXX BARRISTER & SOLIC
Mailing Address: STIKEMAN, XXXXXXX XXXXXXXXX & XXXXXXXXX
XXXXX 0000, XXXX XXXXX
000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
Inquiry Origin: BC ONLINE Billing #:
Control #: Index: BUSINESS DEBTOR
Search Criteria: CORE-XXXX INTERNATIONAL
______________________________________________________________________
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: FEB 28, 1992 Reg. Length: 5 YEARS
Reg. Time: 10:20:00 Expiry Date: FEB 28, 1997
Base Reg. #: 3874008 Control #: F0588052
Block#
50001 Secured Party: X.X. XXXXXXXX EQUIPMENT CO. LTD.
0000 XXXXXXXX XXXX XXXXX
XXXXXXXXXXX XX X0X 0Xx
*D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC.
(Business) 0000 XXXXXXX XXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.*
V000l MV 031G-91-16997 91 XXXXXXX 311R3OTT
General Collateral:
GNB BATTERY MODEL 18-120C-13 S/N V12630
IEL CHARGER MODEL 185A720 S/N 7210
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUN 25, 1992 Reg. Length: 3 YEARS
Reg. Time: 10:43:12 Expiry Date: JUN 25, 1998
Base Reg. 1: 4071096 Control #: B0521053
*** Expiry date includes subsequent registered renewal(s).
Block#
Continued on Page 2
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 2
S000l Secured Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
*D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 00000 XXXX XXXXX XXX 000
XXXXXXXX XX X0X 0X0
General Collateral:
TELEPHONE EQUIPMENT
---------- R E N E W A L ----------
Reg. Date: MAY 17, 1995 Reg. Life: 3 YEARS
Reg. Time: 10:45:00
Reg. #: 5788967 Control #: C1658589
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4071096 Base Reg. Date: JUN 25, 1992
Registering
Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
---------- A M E N D M E N T / O T H E R C H A N G E ----------
Reg. Date: MAY 17, 1995
Reg. Time: 10:45:00
Base Reg. #: 5789656 Control #: C1658588
Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4071096 Base Reg. Date: JUN 25, 1992
Details Description:
AMENDING GENERAL COLLATERAL
General Collateral:
** DELETED **
TELEPHONE EQUIPMENT
*** ADDED ***
TELEPHONE EQUIPMENT LEASE #405258
Registering
Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
Continued on Page 3
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 3
********** P P 5 A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUN 25, 1992 Reg. Length: 3 YEARS
Reg. Time: 10:51:26 Expiry Date: JUN 25, 1998
Base Reg. #: 4071146 Control #: B0521090
*** Expiry date includes subsequent registered renewal(s).
Block#
S0001 Secured Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 0000 XXXXXXX XXXX
XXXXXXXX XX X0X 0X0
General Collateral:
TELEPHONE EQUIPMENT
---------- R E N E W A L ----------
Reg. Date: MAY 17, 1995 Reg. Life: 3 YEARS
Reg. Time: 10:45:00
Reg. #: 5788968 Control #: C1658586
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4071146 Base Reg. Date: JUN 25, 1992
Registering
Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
---------- A M E N D M E N T / O T H E R C H A N G E ------------
Reg. Date: MAY 17, 1995
Reg. Time: 10:45:00
Reg. #: 5789655 Control #: C1658587
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4071146 Base Reg. Date: JUN 25, 1992
Details Description:
AMENDING GENERAL COLLATERAL
General Collateral:
** DELETED **
TELEPHONE EQUIPMENT
Continued on Page 4
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 4
*** ADDED ***
TELEPHONE EQUIPMENT LEASE 1405259
Registering
Party: TELECOM LEASING CANADA (TLC) LIMITED
700 0000 XXXXXXXX XXXXXX
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: DEC 23, 1992 Reg. Length: 6 YEARS
Reg. Time: 16:06:29 Expiry Date: DEC 23, 1998
Base Reg. #: 4374735 Control #: B0689691
Block#
S0001 Secured Party: IBM CANADA LTD.
0000 XXXXXXX XXXXXX XXXX.,
XXXXXXX XXX X0X 0X0
X0000 Xxxx Xxxxxx: XXXXXXXX XXXXXX LTD
(Business) 0000 XXXXXXXX XXXXXX, XXX 0000
XXXXXXXXX XX X0X 0X0
=D0002 Bus. Debtor: CORE-XXXX INTERNATIONAL, INC
00000 XXXXXX XXXXX, XXX 000
XXXXXXXX XX X0X 0X0
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED GOODS SUPPLIED BY THE
SECURED PARTY, INCLUDING WITHOUT LIMITATION, ALL OFFICE
MACHINES, OFFICE EQUIPMENT, COMPUTER HARDWARE, SOFTWARE
AND ANCILLARY PRODUCTS SUPPLIED BY THE SECURED PARTY, AND
ALL PROCEEDS THEREFROM REGARDLESS OF THE FORM OF THE
PROCEEDS.
Registering
Party: XXXXXXX & XXXXXXXX
0000 X XXXXXXX XX, XXX 0000
XXXXXXXXX XX X0X 0X0
*** Name/Address Changed on October 25, 1994 to:
Registering
Party: XXXXXXX & DUMOULIN
0000 X XXXXXXX XX, XXX 0000
XXXXXXXXX XX X0X 0X0
Continued on Page 5
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 5
---------- A M E N D M E N T / 0 T H E R C H A N G E -----------
Reg. Date: JAN 14, 1993
Reg. Time: 10:15:00
Reg. #: 4403182 Control #: C0899147
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4374735 Base Reg. Date: DEC 23, 1992
Details Description:
ADD TWO DEBTORS
Block#
*** ADDED ***
D0003 Bus. Debtor: COMDISCO DU CANADA LTEE
0000 XXXXXXXX XXXXXX, XXX 0000
XXXXXXXXX XX X0X 0X0
*** ADDED ***
D0004 Bus. Debtor: COMDISCO CANADA LTD/COMDISCO DU
CANADA LTEE
0000 XXXXXXXX XXXXXX, XXX 0000
XXXXXXXXX XX X0X 0X0
Registering
Party: XXXXXXX & DUMOULIN
0000 X XXXXXXX XX, XXX 0000
XXXXXXXXX XX X0X 0X0
*** Name/Address Changed on October 25, 1994 to:
Registering
Party: XXXXXXX & XXXXXXXX
0000 X XXXXXXX XX, XXX 0000
XXXXXXXXX XX X0X 0X0
********** P P 5 A S E C U R I T Y A G R E E M E N T **********
Reg. Date: FEB 15, 1993 Reg. Length: S YEARS
Reg. Time: 09:00:00 Expiry Date: FEB 15, 1998
Base Reg. #: 4457490 Control #: F1219612
Block#
S0001 Secured Party: COMDISCO CANADA LTD.
XXXXX XXXX XXXXX, XXXXX XXXXX,
XXXXXXX XXX X0X 0X0
Continued on Page 6
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 6
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX XX X0X 0X0
General Collateral:
EQUIPMENT LEASED PURSUANT TO MASTER LEASE AGREEMENT DATED JANUARY 13,
AND PROCEEDS.
--------A D D I T I O N O F C O L L A T E R A L / P R 0 C E E D S-------
Reg. Date: MAR 03, 1995
Reg. Time: 10:50:00
Reg. #: 5669001 Control #: C1606120
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4457490 Base Reg. Date: FEB 15, 1993
General Collateral:
*** ADDED ***
ALL PROPERTY LEASED UNDER A MASTER LEASE DATED JANUARY 13, 1993 AND
CORRESPONDING LEASE SCHEDULES INCLUDING BUT NOT LIMITED TO THE
FOLLOWING: ONE IBM 9406 E45 S/N 10A9488, ONE IBM 2623 SIX LINE COMM
CONTROLLER S/N 10A9489, ONE IBM 2626, ONE IBM 2644,ONE IBM 2658, TWO
IBM 3101, TWO IBM 6112, ONE IBM 6140, TWO IBM 6173, ONE IBM 6175.
THREE IBM 5494-001 REMOTE CONTROLLERS S/N 8201420, 8201421,
8201422. ONE CROSS COMM XLT-20 WITH THE FOLLOWING FEATURES:
XLM-EEWW/XL-WS-V35IBM/XL-WS-SCM/XL-PS/FPX-20-R/IMS-1/XLM-MODEM/CS-
V35/CS-V35-PT. ONE BM 9406 E60 S/N A3534, ONE IBM 2623 SIX LINE COMM
CONTROLLER, ONE IBM 2619 OR 2626, ONE IBM 2644, ONE IBM 2658, TWO IBM
3104, ONE IBM 5042, ONE IBM 5512, ONE IBM 5520, ONE IBM 5540, ONE IBM
6050 OR 6140, ONE IBM 6173, ONE IBM 6175, ONE IBM 6501, ONE IBM 9080,
ONE IBM 9865, ONE IBM 9980 ONE IBM XXXXX E60/1/2 INCH 3480 CART. 18
TRACK TOGETHER WITH ALL PARTS AND ACCESSORIES INSTALLED IN OR AFFIXED
OR ATTACHED TO ANY OF THE FOREGOING AND ALL MANUALS AND USER
DOCUMENTATION RELATING THERETO AND ALL PROCEEDS IN ANY FORM DERIVED
DIRECTLY OR INDIRECTLY FROM ANY DEALING WITH THE COLLATERAL.
Registering
Party: CANADIAN SECURITIES REGISTRATION
SYSTEMS
000 0000 XXXXX XXXX,
XXXXXXXX XX X0X 0X0
********** P P 5 A S E C U R I T Y A G R E E M E N T **********
Reg. Date: MAR 09, 1993 Reg. Length: 5 YEARS
Reg. Time: 15:00:00 Expiry Date: MAR 09, 1998
Base Reg. #: 4492529 Control #: F1889100
Block#
Continued on Page 7
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 7
+++ Secured Party: MANUFACTURER FINANCE PROGRAMS LTD
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on August 20, 1993 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX XX X0X 0X0
General Collateral:
ALL EQUIPMENT PURSUANT TO SCHEDULE OF TERMS 517 DATED MAR 3/93
AND ALL EQUIPMENT LEASED AND AMOUNTS OWING THEREUNDER.
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: AUG 12, 1993 Reg. Length: 5 YEARS
Reg. Time: 13:44:09 Expiry Date: AUG 12, 1998
Base Reg. #: 4761308 Control #: B0923784
Block#
+++ Secured Party: MANUFACTURER FINANCE PROGRAMS LTD
0000 XXXXX XXXXXXXX XXX 1280
MISSISSAUGA ONT LSK 2P8
*** Name/Address Changed on August 20, 1993 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 1280
MISSISSAUGA ONT LSK 2P8
*** Name/Address Changed en March 4, 1996 to:
S000l Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 253
Continued on Page 8
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 8
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-2 DATED AUGUST
13, 1993 UNDER SCHEDULE OF TERMS NO. 517 DATED MARCH 3, 1993 AND ALL
AMOUNTS OWING THEREUNDER.
Registering
Party: MANUFACTURER FINANCE PROGRAMS LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on August 20, 1993 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: SEP 27, 1993 Reg. Length: 6 YEARS
Reg. Time: 08:38:25 Expiry Date: SEP 27, 1999
Base Reg. #: 4839192 Control #: B0971051
Block#
S0001 Secured Party: RENTWAY INC.
1910 000 0XX XXX. X X
XXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE XXXX INTERNATIONAL INC
(Business) 1140 00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0XX
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V000l MV 0XXXX0XX0XXX00000 94 FORD HDCC
2138 513
Continued on Page 9
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 9
Registering
Party: RENTWAY INC.
1910 000 0XX XXX.X X
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: DEC 03, 1993 Reg. Length: 5 YEARS
Reg. Time: 13:56:11 Expiry Date: DEC 03, 1998
Base Reg. #: 4956110 Control #: B1040696
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX XXX 0X0
=DOOO1 Base Debtor: CORE-XXXX INTERNATIONAL INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-3 DATED
NOVEMBER 29, 1993, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF
TERMS NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed en March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
Continued on Page 10
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 10
---------- A M E N D M E N T / 0 T H E R C H A N G E ----------
Reg. Date: MAR 09, 1995
Reg. Time: 11:10:00
Reg. #: 5678507 Control #: C1614515
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 4956110 Base Reg. Date: DEC 03, 1993
Details Description:
TO DELETE SECURED PARTY AND ADD NEW SECURED PARTY.
Block#
** DELETED **
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
*** ADDED ***
S0002 Secured Party: BARCLAYS BANK OF CANADA
000 XXX XXXXXX
XXXXXXX XX XXX 0X0
Registering
Party: CANADIAN SECURITIES REGISTRATION SYSTEMS
000 0000 XXXXX XXXX,
XXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JAN 05, 1994 Reg. Length: 5 YEARS
Reg. Time: 14:03:17 Expiry Date: JAN 05, 1999
Base Reg. #: 5001568 Control #: B1067403
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 1280
MISSISSAUGA ONT LSK 2P8
Continued on Page 11
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 11
*** Name/Address Changed on March 4, 1996 to:
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D000l Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-4 DATED
JANUARY 5, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF TERMS
NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: MAR 07, 1994 Reg. Length: 5 YEARS
Reg. Time: 13:09:10 Expiry Date: MAR 07, 1999
Base Reg. #: 5096864 Control #: B1124219
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Continued on Page 12
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 12
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-5 DATED MARCH
7, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF TERMS NO. 517
DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: APR 13, 1994 Reg. Length: 4 YEARS
Reg. Time: 09:42:06 Expiry Date: APR 13, 1998
Base Reg. #: 5158292 Control #: B1161242
Block#
S0001 Secured Party: RENTWAY INC.
1910 000 0XX XXX.X X
XXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC.
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV 1FUYDSEBORP75527Z 94 FREIGHTLINER FLDl20
Registering
Party: RENTWAY INC.
1910 000 0XX XXX.X X
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: APR 14, 1994 Reg. Length: 4 YEARS
Reg. Time: 08:40:12 Expiry Date: APR 14, 1998
Base Reg. #: 5160635 Control #: B1159309
Block# 2138 51?
Continued on Page 13
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 13
S000l Secured Party: CANADIAN WESTERN BANK LEASING INC.
000 - 000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
=D000l Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 0000 XXXXXXX XXXX
XXXXXXXX XX X0X 0X0
General Collateral:
104 COLDSTREAM RSCP 48G5 COOLERS S/N'S 94B0327 TO 94B0430 C/W GRAPHICS
2 EXTRA SHELVES PER UNIT TAG MOLDING ALL PARTS, ACCESSORIES) GOODS
AND EQUIPMENT NOW OR HEREAFTER ATTACHED TO OR FORMING A PART OF THE
GOODS DESCRIBED IN THIS FINANCING STATEMENT
PROCEEDS: GOODS (INCLUDING TRADE-INS), CHATTEL PAPER, SECURITIES,
DOCUMENTS OF TITLE, INSTRUMENTS, MONEY AND INTANGIBLES.
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: AUG 16, 1994 Reg. Length: 5 YEARS
Reg. Time: 13:29:32 Expiry Date: AUG 16, 1999
Base Reg. #: 5364783 Control #: B1286869
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 1280
MISSISSAUGA ONT LSK 2P8
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-6 DATED
AUGUST 16, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF TERMS
NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
Continued on Page 14
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 14
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
---------- A M E N D M E N T / O T H E R C H A N G E ----------
Reg. Date: MAR 09, 1995
Reg. Time: 11:10:00
Reg. #: 5678508 Control #: C1614514
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 5364783 Base Reg. Date: AUG 16, 1994
Details Description:
TO DELETE SECURED PARTY AND ADD NEW SECURED PARTY.
Block#
** DELETED **
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
*** ADDED ***
S0002 Secured Party: BARCLAYS BANK OF CANADA
000 XXX XXXXXX
XXXXXXX XX XXX 0X0
Registering
Party: CANADIAN SECURITIES REGISTRATION SYSTEMS
000 0000 XXXXX XXXX,
XXXXXXXX XX X0X 0X0
Continued on Page 15
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 15
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: OCT 26, 1994 Reg. Length: 5 YEARS
Reg. Time: 13:16:42 Expiry Date: OCT 26, 1999
Base Reg. #: 5479148 Control #: B1354819
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-7 DATED
OCTOBER 21, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF TERMS
NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX XXX 0X0
---------- A M E N D M E N T / O T H E R C H A N G E ----------
Reg. Date: MAR 09) 1995
Reg. Time: 1#:10:00
Reg. #: 5678509 Control #: C1614513
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 5479148 Base Reg. Date: OCT 26, 1994
Details Description:
TO DELETE SECURED PARTY AND ADD NEW SECURED PARTY.
Continued on Page 16
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 16
Block#
** DELETED **
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
*** ADDED ***
S0002 Secured Party: BARCLAYS BANK OF CANADA
000 XXX XXXXXX
XXXXXXX XX X0X 0X0
Registering
Party: CANADIAN SECURITIES REGISTRATION SYSTEMS
000 0000 XXXXX XXXX,
XXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: DEC 21, 1994 Reg. Length: 5 YEARS
Reg. Time: 12:5#:14 Expiry Date: DEC 21, 1999
Base Reg. #: 5568305 Control #: B1410449
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed en March 4, 1996 to:
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D000l Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 601-13211 DELF PLACE
RICHMOND B.C. V6V ZA2
Continued on Page 17
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 17
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-8 DATED
DECEMBER 20, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF
TERMS NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4) 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: DEC 21, 1994 Reg. Length: 5 YEARS
Reg. Time: 12:5#:16 Expiry Date: DEC 21, 1999
Base Reg. #: 5568306 Control #: B1410450
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-9 DATED
DECEMBER 20, 1994, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF
TERMS NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX 0000
XXXXXXXXXXX XXX X0X 0X0
Continued on Page 18
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 18
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: FEB 06, 1995 Reg. Length: 5 YEARS
Reg. Time: 12:18:21 Expiry Date: FEB 06, 2000
Base Reg. #: 5629923 Control #: B1449421
Block#
+++ Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
S000l Secured Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX X.X. X0X 0X0
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-10 DATED
FEBRUARY 1, 1995, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF TERMS
NO. 517 DATED MARCH 3, 1993 AND ALL AMOUNTS OWING THEREUNDER.
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX #000
XXXXXXXXXXX XXX X0X 0X0
*** Name/Address Changed on March 4, 1996 to:
Registering
Party: MFP TECHNOLOGY SERVICES LTD.
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XXX X0X 0X0
Continued on Page 19
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 19
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: FEB 10, 1995 Reg. Length: 6 YEARS
Reg. Time: 09:50:32 Expiry Date: FEB 10, 2001
Base Reg. #: 5637599 Control #: B1454670
Block#
S0001 Secured Party: RENTWAY INC.
1910 000 0XX XXX.X X
XXXXXXX XX X0X 0X0
=D000l Base Debtor: CORE XXXX INTERNATIONAL INC DIV CORE
(Business) XXXX DISTRIBUTORS DIV
140 00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV 0XXX000X00XX00000 95 FORD LA9OOO
Registering
Party: RENTWAY INC.
1910 000 0XX XXX.X X
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: FEB 23, 1995 Reg. Length: 10 YEARS
Reg. Time: 14:53:01 Expiry Date: FEB 23, 2005
Base Reg. #: 5657110 Control #: B1466697
Block#
S0001 Secured Party: CITICORP USA, INC.
000 XXXX XXXXXX
XXX XXXX XX 00000
=D000l Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
Continued on Page 20
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Search Criteria: CORE-XXXX INTERNATIONAL Page: 20
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: APR 28, 1995 Reg. Length: 6 YEARS
Reg. Time: 09:23:40 Expiry Date: APR 28, 2001
Base Reg. #: 5753001 Control #: B15280250
Block#
S0001 Secured Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL) INC.
(Business) 140 00000 XXXXXX XXXXX
XXXXXXXX XX X0X0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.*
V0001 MV 0XXXX00X00X000000 KENWORTH T300
Registering
Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX VSB 3A4
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUL 05, 1995 Reg. Length: 6 YEARS
Reg. Time: 11:31:52 Expiry Date: JUL 05, 2001
Base Reg. #: 5866771 Control #: B1599863
Block#
S000l Secured Party: PACCAR OF CANADA,LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
D0001 Base Debtor: INLAND KENWORTH LTD
(Business) 0000 XXXXXX XXXXXX
XXXXXXX X.X. X0X 0X0
=D0002 Bus. Debtor: CORE-XXXX INTERNATIONAL INC
000-00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV ZXKBAS8XlTM941276 96 KENWORTH T400
V0002 MV 0XXXX00X0XX000000 96 KENWORTH T400
Continued on Page 21
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 21
Registering
Party: PACCAR OF CANADA,LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUL 07, 1995 Reg. Length: 6 YEARS
Reg. Time: 09:07:04 Expiry Date: JUL 07, 2001
Base Reg. #: 5871444 Control #: B1559553
Block#
S000l Secured Party: ENSIGN PACIFIC LEASE LTD.
0000 XXXX XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
+D0001 Base Debtor: CORE-XXXX INTERNATIONAL
(Business) #140 - 00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V000l MV 0XXXX00000X000000 95 FORD TAURUS GL 4DR. SEDAN
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUL 13, 1995 Reg. Length: 8 YEARS
Reg. Time: 14:45:01 Expiry Date: JUL 13, 2003
Base Reg. #: 5881647 Control #: B1609446
Block#
S0001 Secured Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000 - 00000 XXXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.1
V0001 MV 0XXXX00X0XX000000 X000 XXXXXXXX
X0000 XX 0XXXX00X0XX000000 T400 KENWORTH
Continued on Page 22
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 22
Registering
Party: INLAND INDUSTRIES LTD.
0000 XXXXXXX XXXX
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: AUG 04, 1995 Reg. Length: 7 YEARS
Reg. Time: 08:50:25 Expiry Date: AUG 04, 2002
Base Reg. #: 5916963 Control #: B1632815
Block#
S0001 Secured Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 140 00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV lXKDDR9XOTS94139l KENWORTH T8OOB
Registering
Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: AUG 16, 1995 Reg. Length: 8 YEARS
Reg. Time: 09:48:37 Expiry Date: AUG 16, 2003
Base Reg. #: 5932783 Control #: B1642787
Block#
S000l Secured Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
=D000l Base Debtor: CORE-XXXX INTERNATIONAL, INC.
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V000l MV 0XXXX00X00X000000 KENWORTH T300
Continued on Page 23
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 23
Registering
Party: INLAND KENWORTH
0000 XXXXXX XXXXXX
XXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: OCT 23, 1995 Reg. Length: 6 YEARS
Reg. Time: 12:29:48 Expiry Date: OCT 23, 2001
Base Reg. #: 6046467 Control #: B1712420
Block*
S000l Secured Party: PACCAR OF CANADA,LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
=D000l Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 000 - 00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
D0002 Bus. Debtor: INLAND KENWORTH LTD
0000 XXXXXX XXXXXX
XXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV 1XKDDR9XOTS94139l 96 KENWORTH T800
Registering
Party: PACCAR OF CANADA,LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Rag. Date: OCT 23, 1995 Reg. Length: 8 YEARS
Reg. Time: 12:30:09 Expiry Date: OCT 23, 2003
Base Rag. #: 6046469 Control #: B1712422
Block#
S0001 Secured Party: PACCAR OF CANADA,LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
D0001 Base Debtor: INLAND KENWORTH LTD
(Business) 0000 XXXXXX XXXXXX
XXXXXXX X.X. X0X 0X0
Continued on Page 24
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 24
=D0002 Bus. Debtor: CORE-XXXX INTERNATIONAL INC
000-00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V000l MV 0XXXX00X00X000000 95 KENWORTH T300
Registering
Party: PACCAR OF CANADA, LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: JUL 11, 1995 R3g. Length: 8 YEARS
Reg. Time: 12:33:21 Expiry Date: JUL 11, 2003
Base Reg. #: 5876306 Control #: B1606301
Block#
S0001 Secured Party: PACCAR OF CANADA, LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
D0001 Base Debtor: INLAND KENWORTH LTD
(Business) 0000 XXXXXX XXXXXX
XXXXXXX X.X. X0X 0X0
Bus. Debtor: CORE-XXXX
000-00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV 0XXXX00X00X000000 95 KENWORTH
Registering
Party: PACCAR OF CANADA, LTD.
0000 XXXXXXXXXXX XXXX,
XXXXX XXXXXXXXXXX XX X0X 0X0
Continued on Page 25
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 25
---------- A M E N D M E N T / O T H E R C H A N G ----------E
Reg. Date: NOV 21, 1995
Reg. Time: 09:55:00
Reg. #: 6100865 Control #: C1816443
Base Reg. Type: PPSA SECURITY AGREEMENT
Base Reg. #: 5876306 Base Reg. Date: JUL 11, 1995
Details Description:
CORRECT NAME ADDED TO REGISTRATION
Block#
** DELETED **
Bus. Debtor: CORE-XXXX
000-00000 XXXXXX XXXXX
XXXXXXXX X.X. X0X 0X0
*** ADDED ***
=D0003 Bus. Debtor: CORE-XXXX INTERNATIONAL INC
000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Registering
Party: CANADIAN SECURITIES REGISTRATION SYSTEMS
000 0000 XXXXX XXXX,
XXXXXXXX XX X0X 0X0
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: DEC 20, 1995 Reg. Length: 5 YEARS
Reg. Time: 08:42:49 Expiry Date: DEC 20, 2000
Base Rag. #: 6141778 Control #: B1773562
Block#
S0001 Secured Party: MFP TECHNOLOGY SERVICES LTD
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XX X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC.
(Business) 000-00000 XXXX XXXXX
XXXXXXXX XX X0X 0X0
Continued on Page 26
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 26
General Collateral:
COMPUTER EQUIPMENT PURSUANT TO LEASE AGREEMENT NO. 517-li DATED
DECEMBER 18) 1995, AND ALL AMENDMENTS THERETO, UNDER SCHEDULE OF
TERMS FOR EQUIPMENT LEASE AGREEMENT NO. 517 DATED MARCH 3, 1993,
AND ALL AMOUNTS OWING THEREUNDER.
DEBTORS FULL NAME IS-
CORE-XXXX INTERNATIONAL, INC.
Registering
Party: MFP TECHNOLOGY SERVICES LTD
0000 XXXXX XXXXXXXX XXX
XXXXXXXXXXX XX X0X 0X0
********** R E P A I R E R S L I E N A C T **********
Reg. Date: APR 02, 1996 Reg. Length: 180 DAYS
Reg. Time: 10:05:32 Expiry Date: SEP 30, 1996
Base Reg. #: 6307632 Control #: B1877762
Amount of Lien: $2617.52 Surrender Date: MAR 18, 1996
Block#
S0001 Secured Party: PER.X. XXXXXXXXXXX LTD. DBA
ANNACIS TRUCK & TRAILER SERVICE
000 XXXXXXXX XXXXXX
XXX XXXXXXXXXXX X.X. X0X 0X0
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV 0XX000XX0X0000000 89 TRAILMBILE SEMI
********** R E P A I R E R S L I E N A C T **********
Reg. Date: APR 02, 1996 Reg. Length: 180 DAYS
Reg. Time: 10:10:36 Expiry Date: SEP 30, 1996
Base Reg. #: 6307650 Control #: B1877789
Amount of Lien: $2791.76 Surrender Date: MAR 22, 1996
Block#
S0001 Secured Party: PER.M. ENTERPRISES LTD. DBA
ANNACIS TRUCK & TRAILER SERVICE
000 XXXXXXXX XXXXXX
XXX XXXXXXXXXXX X.X. X0X 0X0
Continued on Page 27
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--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 27
=D000l Base Debtor: CORE-XXXX INTERNATIONAL INC
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV JHBSGZ354K1S1O17S 89 HINO VAN
********** R E P A I R E R S L I E N A C T **********
Reg. Date: JUL 16, 1996 Reg. Length: 180 DAYS
Reg. Time: 16:25:30 Expiry Date: JAN 13, 1997
Base Reg. #: 6491191 Control #: B1999499
Amount of Lien: $1945.79 Surrender Date: JUN 25, 1996
Block*
S000l Secured Party: PER.M. ENTERPRISES LTD. DBA
ANNACIS TRUCK & TRAILER SERVICE
000 XXXXXXXX XXXXXX
XXX XXXXXXXXXXX X.X. X0X 0X0
=D0001 Base Debtor: COREMARK INTERNATIONAL INC.
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V0001 MV JHBSG235XL1TlO198 90 HINO VAN
********** R E P A I R E R S L I E N A C T **********
Reg. Date: JUL 31, 1996 Reg. Length: 180 DAYS
Reg. Time: 08:58:04 Expiry Date: JAN 27, 1997
Base Reg. #: 6521207 Control #: B2016283
Amount of Lien: $1782.86 Surrender Date: JUL 13, 1996
Block#
S000l Secured Party: PER.M. ENTERPRISES LTD. DBA
ANNACIS TRUCK & TRAILER SERVICE
000 XXXXXXXX XXXXXX
XXX XXXXXXXXXXX X.X. X0X 0X0
D0001 Base Debtor: CORE-XXXX INT'L INC. #50
(Business) 000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Continued on Page 28
--------------------------------------------------------------------------------
BC Online: PPRS SEARCH RESULT
--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 28
=D0002 Bus. Debtor: CORE XXXX INTERNATIONAL INC.
000-00000 XXXXXX XXXXX
XXXXXXXX XX X0X 0X0
Vehicle Collateral:
Type Serial # Year Make/Model MH Reg.#
V000l MV XXX0X0000X0000000 89 HINO VAN
********** P P S A S E C U R I T Y A G R E E M E N T **********
Reg. Date: AUG 06, 1996 Reg. Length: 10 YEARS
Reg. Time: 1#:38:28 Expiry Date: AUG 06, 2006
Base Reg. #: 6529487 Control #: B2021119
Block#
S000l Secured Party: THE CHASE MANHATTAN BANK, AS
ADMINISTRATIVE AGENT - LIEN PERF.
DEPT .
000 XXXXXXX XXXXXXXXXX
XXXXXXX XX 00000
=D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0002 Bus. Debtor: C/M PRODUCTS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0003 Bus. Debtor: CORE-XXXX INTERRELATED COMPANIES, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0004 Bus. Debtor: CORE-XXXX MIDCONTINENT, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0005 Bus. Debtor: CORE-XXXX DISTRIBUTORS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Continued on Page 29
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BC Online: PPRS SEARCH RESULT
--------------------------------------------------------------------------------
Search Criteria: CORE-XXXX INTERNATIONAL Page: 29
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
****************************************************************************
Some, but not all, tax liens and other Crown claims are registered at the
Personal Property Registry (PPR) and if registered, will be displayed on this
search result. HOWEVER, it is possible that a particular chattel is subject
to a Crown claim that is not registered at the PPR. Please consult the
Miscellaneous Registrations Act, 1992 for more details. If you are concerned
that a particular chattel may be subject to a Crown claim not registered at
the PPR, please consult the agency administering the type of Crown claim.
****************************************************************************
****************************************************************************
WARNING: The currency date noted at the top of this search
indicates the date to which registrations have been completely
recorded on the system. While some registrations processed after
this date may be included, others may still be in process and not
included.
*********************************** END OF SEARCH ***************************
Page: 1
As of: JUL 31 1996 BC OnLine: PPRS SEARCH RESULT 96/08/06
Lterm: V1381414 For: PE12804 STIKEMAN, XXXXXXX BAPRISTER & SOL 11:43:02
Search Criteria: C/M PRODUCT Index: BUSINESS DEBTOR
**************** P P S A S E C U R I T Y A G R E E M E N T ****************
Reg. Date: AUG 06, 1996 Reg. Length: 10 YEARS
Reg. Time: 11:38:28 Expiry Date: AUG 06, 2006
Base Reg. #: 6529487 Control #: B2021119
Block#
S0001 Secured Party: THE CHASE MANHATTAN BANK, AS
ADMINISTRATIVE AGENT - LIEN PERF.
DEPT.
000 XXXXXXX XXXXXXXXXX
XXXXXXX XX 00000
D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
=D0002 Bus. Debtor: C/M PRODUCTS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0003 Bus. Debtor: CORE-XXXX INTERRELATED COMPANIES, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0004 Bus. Debtor: CORE-XXXX MIDCONTINENT, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0005 Bus. Debtor: CORE-XXXX DISTRIBUTORS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
******************************************************************************
Some, but not all, tax liens and other Crown claims are registered at the
Personal Property Registry (PPR) and if registered, will be displayed on this
search result. HOWEVER, it is possible that a particular chattel is subject
to a Crown claim that is not registered at the PPR. Please consult the
Miscellaneous Reqistrations Act, 1992 for more details. If you are concerned
that a particular chattel may be subject to a Crown claim not registered at
the PPR, please consult the agency administering the type of Crown claim.
Continued on Page 2
Search Criteria: C/M PRODUCT Page: 2
*******************************************************************************
WARNING: The currency date noted at the top of this search indicates the
date to which registrations have been completely recorded on the
system. While some registrations processed after this date may be
included, others may still be in process and not included.
*********************************** END OF SEARCH ***************************
As of: JUL 31 1996 BC OnLine: PPRS SEARCH RESULT 96/08/06
Lterm: V1381414 For: PE12804 STIKEMAN, XXXXXXX BAPRISTER & SOL 11:43:02
Search Criteria: CORE-XXXX INTERRELATED Index: BUSINESS DEBTOR
**************** P P S A S E C U R I T Y A G R E E M E N T ****************
Reg. Date: AUG 06, 1996 Reg. Length: 10 YEARS
Reg. Time: 11:38:28 Expiry Date: AUG 06, 2006
Base Reg. #: 6529487 Control #: B2021119
Block#
S0001 Secured Party: THE CHASE MANHATTAN BANK, AS
ADMINISTRATIVE AGENT - LIEN PERF.
DEPT.
000 XXXXXXX XXXXXXXXXX
XXXXXXX XX 00000
D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0002 Bus. Debtor: C/M PRODUCTS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
=D0003 Bus. Debtor: CORE-XXXX INTERRELATED COMPANIES, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0004 Bus. Debtor: CORE-XXXX MIDCONTINENT, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0005 Bus. Debtor: CORE-XXXX DISTRIBUTORS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
*****************************************************************************
Some, but not all, tax liens and other Crown claims are registered at the
Personal Property Registry (PPR) and if registered, will be displayed on this
search result. HOWEVER, it is possible that a particular chattel is subject
to a Crown claim that is not registered at the PPR. Please consult the
Miscellaneous Registrations Act, 1992 for more details. If you are concerned
that a particular chattel may be subject to a Crown claim not registered at
the PPR, please consult the agency administering the type of Crown claim.
Continued on Page 2
Search Criteria: CORE-XXXX INTERRELATED Page: 2
*****************************************************************************
WARNING: The currency date noted at the top of this search indicates the
date to which registrations have been completely recorded on the
system. While some registrations processed after this date may be
included, others may still be in process and not included.
************************************ END OF SEARCH ***************************
As of: JUL 31 1996 BC OnLine: PPRS SEARCH RESULT 96/08/06
Lterm: V1381414 For: PE12804 STIKEMAN, XXXXXXX BAPRISTER & SOL 11:43:02
Search Criteria: CORE-XXXX MIDCONTINENT Index: BUSINESS DEBTOR
**************** P P S A S E C U R I T Y A G R E E M E N T ****************
Reg. Date: AUG 06, 1996 Reg. Length: 10 YEARS
Reg. Time: 11:38:28 Expiry Date: AUG 06, 2006
Base Reg. #: 6529487 Control #: B2021119
Block#
S0001 Secured Party: THE CHASE MANHATTAN BANK, AS
ADMINISTRATIVE AGENT - LIEN PERF.
DEPT.
000 XXXXXXX XXXXXXXXXX
XXXXXXX XX 00000
D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0002 Bus. Debtor: C/M PRODUCTS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0003 Bus. Debtor: CORE-XXXX INTERRELATED COMPANIES, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
=D0004 Bus. Debtor: CORE-XXXX MIDCONTINENT, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0005 Bus. Debtor: CORE-XXXX DISTRIBUTORS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
*****************************************************************************
Some, but not all, tax liens and other Crown claims are registered at the
Personal Property Registry (PPR) and if registered, will be displayed on this
search result. HOWEVER, it is possible that a particular chattel is subject
to a Crown claim that is not registered at the PPR. Please consult the
Miscellaneous Registrations Act, 1992 for more details. If you are concerned
that a particular chattel may be subject to a Crown claim not registered at
the PPR, please consult the agency administering the type of Crown claim.
Continued on Page 2
Search Criteria: CORE-XXXX MIDCONTINENT Page: 2
*****************************************************************************
WARNING: The currency date noted at the top of this search indicates the
date to which registrations have been completely recorded on the
system. While some registrations processed after this date may be
included, others may still be in process and not included.
****************************** END OF SEARCH ********************************
As of: JUL 31 1996 BC OnLine: PPRS SEARCH RESULT 96/08/06
Lterm: V1381414 For: PE12804 STIKEMAN, XXXXXXX BAPRISTER & SOL 11:43:02
Search Criteria: CORE-XXXX DISTRIBUTOR Index: BUSINESS DEBTOR
**************** P P S A S E C U R I T Y A G R E E M E N T ****************
Reg. Date: AUG 06, 1996 Reg. Length: 10 YEARS
Reg. Time: 11:38:28 Expiry Date: AUG 06, 2006
Base Reg. #: 6529487 Control #: B2021119
Block#
S0001 Secured Party: THE CHASE MANHATTAN BANK, AS
ADMINISTRATIVE AGENT - LIEN PERF.
DEPT.
000 XXXXXXX XXXXXXXXXX
XXXXXXX XX 00000
D0001 Base Debtor: CORE-XXXX INTERNATIONAL, INC
(Business) 000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0002 Bus. Debtor: C/M PRODUCTS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0003 Bus. Debtor: CORE-XXXX INTERRELATED COMPANIES, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
D0004 Bus. Debtor: CORE-XXXX MIDCONTINENT, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
=D0005 Bus. Debtor: CORE-XXXX DISTRIBUTORS, INC
000 XXXXXX XXXXX XXXX, XXX 000
XXXXX XXX XXXXXXXXX XX 00000
General Collateral:
ALL PRESENT AND AFTER-ACQUIRED PERSONAL PROPERTY OF THE DEBTOR.
Registering
Party: STIKEMAN ELLIOTT
0000-000 XXXXXXX XXXXXX
XXXXXXXXX XX X0X 0X0
****************************************************************************
Some, but not all, tax liens and other Crown claims are registered at the
Personal Property Registry (PPR) and if registered, will be displayed on this
search result. HOWEVER, it is possible that a particular chattel is subject
to a Crown claim that is not registered at the PPR. Please consult the
Miscellaneous Reqistrations Act, 1992 for more details. If you are concerned
that a particular chattel may be subject to a Crown claim not registered at
the PPR, please consult the agency administering the type of Crown claim.
Continued on Page 2
Search Criteria: CORE-XXXX DISTRIBUTOR Page: 2
****************************************************************************
WARNING: The currency date noted at the top of this search indicates the
date to which registrations have been completely recorded on the
system. While some registrations processed after this date may be
included, others may still be in process and not included.
********************************* END OF SEARCH ****************************
[Letterhead of Xxxxxxxx Xxxxxxx Xxxxxxxx]
Exhibit J-5
August 7, 1996
STIKEMAN, XXXXXXX
Barristers and Solicitors
X.X. Xxx 00
0000 Xxxxxxxx Xxxxx Xxxx
Xxxxxxx, XX X0X 0X0
THE CHASE MANHATTAN BANK
(and the other Lenders)
000 Xxxxxxx Xxxxxxxxxxx
Xxxxxxx, XXX XXXX 00000
XXXXXXX XXXXXXX & XXXXXXXX
Barristers and Solicitors
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XXX XXXX 00000-0000
Re: CORE-XXXX INTERNATIONAL, INC.
(the "Corporation")
We have acted as agents for Stikeman, Xxxxxxx in the Province of Manitoba
(the "Province") in Connection with a security agreement dated as of August 7,
1996 (the "Security Agreement") made between the Corporation, CIM Products,
Inc., Core-Xxxx Interrelated Companies, Inc. and Core-Xxxx Midcontinent, Inc.
(collectively the "Business Debtors") and The Chase Manhattan Bank (the "Bank")
as Administrative Agent for the Lenders parties to a Credit Agreement dated as
of August 7, 1996 among the Corporation, the Bank and such Lenders (the "Credit
Agreement").
A Financing Statement giving notice of the Security Agreement was
registered in the Manitoba Personal Property Registry (the "PPR") on August 7,
1996 (the "Financing Statement"). Upon verification of the registration of the
XXXXXXXX XXXXXXX XXXXXXXX
Barristers and Solicitors -2-
Statement a registration number will be assigned, and upon our receipt of the
Verification Statement we will provide the registration number to you.
A Certificate of the Registrar of the PPR dated as at July 9, 1996 at 4:30
p.m. (as updated and confirmed by a search conducted August 7, 1996 for the
period ended at the close of business on July 30, 1996) disclosed the following
registrations against the Corporation which, as regards the Corporation,
continue to remain in priority to the Financing Statement:
1. Registration No.950106-104393 in favour of PACCAR OF CANADA LTD. in
respect of certain motor vehicles;
2. Registration No.951120-101972 in favour of PACCAR OF CANADA LTD. in
respect of a 1996 Kenworth motor vehicle, Serial No. 0XXXX00XXX0000000;
3. Registration No. 950228-102057 in favour of CITICORP USA INC. in respect
of assets described by schedule including inventory, equipment, debts,
accounts and intangibles.
In the Province there may also exist encumbrances ranking in priority to
the Financing Statement of the following nature which would not be disclosed by
our searches:
1. conditional sales contracts made prior to September 1, 1978, being the
date The Personal Property Security Act (Manitoba) (the "PPSA") came
into force;
2. wage claims of employees of the Corporation and the other Business
Debtors under the provisions of The Payment of Wages Act (Manitoba) and
under the provisions of legislation relative to insolvency and
bankruptcy;
3. liens created by statute in favour of Her Majesty in Right of Manitoba,
municipalities, Crown corporations and government agencies on (personal)
property of the Corporation and the other Business Debtors for the
amount of any debt due from the Corporation and the other Business
Debtors which came into existence prior to the registration of the
Financing Statement.
XXXXXXXX XXXXXXX XXXXXXXX
Barristers and Solicitors -3-
In giving the opinion which follows, we have assumed:
(a) the genuineness of all documents submitted to us as originals and the
authenticity and conformity to the originals of all certified and
notarial copies of original documents;
(b) that the Security Agreement has been duly and validly authorized,
executed and delivered to the Bank by the Business Debtors;
(c) the Business Debtors each have the corporate power and capacity to
execute and deliver the Security Agreement;
(d) value has been given by the Bank to the Business Debtors;
(e) the Business Debtors have rights in the Collateral, as that term is
defined in the Security Agreement;
(f) that the Collateral does not include real or immovable property or
property that has been affixed to real or immovable property.
For the purposes of the PPSA, the validity, perfection and possibility and
effect of proper registration with respect to intangibles (which includes
accounts receivable) is governed by the law of the jurisdiction in which the
chief place of business of the debtor is located.
Based and relying upon the foregoing and subject to the qualifications
hereinafter set out, we are of the opinion that:
1. The Corporation has been duly registered as an extra-provincial
corporation under the laws of the Province and is in good standing under
the laws of the Province with respect to the filing of Annual Returns.
2. With the exception of the Corporation none of the Business Debtors has
been duly registered as an extra-provincial corporation under the laws
of the Province.
3. The Security Agreement creates in favour of the Bank a valid security
interest in Collateral (as that term is defined in the Security
Agreement) to which the PPSA applies.
XXXXXXXX XXXXXXX XXXXXXXX
Barristers and Solicitors -4-
4. Notice of the Security Agreement has been properly registered according
to the laws of the Province in all places in which registration is
necessary or advisable. No other notice, filing, registration or act is
necessary in the Province to perfect the security interests created by
the Security Agreement.
5. At the time of registration of the Financing Statement, except for the
registrations described above, there were no mortgages, hypothecs,
charges, pledges, encumbrances or security interests registered in the
PPR against or affecting the Corporation which rank or purport to rank
in priority to or pari passu with the security interest created or
granted by the Security Agreement.
The foregoing opinions are:
(a) Subject to the qualification that in order to continue the
effectiveness of the registration of the Financing Statement, it is
necessary to register:
(i) a renewal financing statement respecting the Financing Statement
before the expiration of the three year period from the date of
the initial registration thereof and before the expiration of the
third anniversary of each successive renewal; and
(ii) a transfer financing statement within fifteen (15) days after the
Bank learns that the Corporation has transferred its interest in
the collateral described in the Financing Statement.
(b) subject to the qualification that a security interest in instruments,
securities, letters of credit and advices of credit, or negotiable
documents of title (as such terms are defined in the PPSA can only be
perfected by the Bank (or its agents) possessing such items of
Collateral;
(c) limited to matters governed by the laws of the Province only;
(d) limited to the matters expressly stated herein, and no opinion is
implied or may be inferred beyond the matters expressly stated herein;
XXXXXXXX XXXXXXX XXXXXXXX
Barristers and Solicitors -5-
(e) subject to the qualification that no opinion is expressed as to the
enforceability of a security interest in Collateral to the extent that
such Collateral is not identifiable and traceable;
(f) subject to the qualification that perfection of a security interest in
the Collateral may be defeated or impaired with respect to such portion
of the Collateral that is removed from the Province to another
jurisdiction;
(g) subject to the qualification that motor vehicles or aircraft (as
defined by the PPSA) comprised in the Collateral and used by the
Business Debtors as equipment must be described in the Financing
Statement according to the serial number and other identifying
information required by the PPSA in order for the security interest
therein to be perfected;
(h) subject to the qualification that a license, quota or similar
governmental authorization may not be personal property subject to the
granting of a security interest pursuant to the PPSA; and
(i) subject to the qualification that limitations may exist in law upon the
right of the holder of a judgment to seize patent rights under a writ
of execution and subject to such priorities as may be created pursuant
to the Copyright Act (Canada), the Trade Marks Act (Canada) and the
Patent Act (Canada).
The opinion expressed herein is effective as of the date hereof and is
based upon the laws in effect as of the date hereof. We expressly disclaim any
undertaking or obligation to modify this opinion to reflect changes in facts or
developments in law which may occur after the date hereof.
This opinion is rendered solely for the use of the addressees hereof in
connection with the transaction referred to herein and may not be relied upon by
any other parties or for any other purpose without our prior express written
consent.
Yours truly,
/s/Xxxxxxxx Xxxxxxx Xxxxxxxx
EXHIBIT K TO
CREDIT AGREEMENT
[FORM OF]
ASSIGNMENT AND ACCEPTANCE
Reference is made to the Credit Agreement, dated as of August 7, 1996
(as amended, supplemented or otherwise modified from time to time, the
"CREDIT AGREEMENT"), among Core-Xxxx International, Inc. (the "BORROWER"),
the Lenders named therein and The Chase Manhattan Bank, as administrative agent
for the Lenders (in such capacity, the "ADMINISTRATIVE AGENT"). Unless
otherwise defined herein, terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement.
The Assignor identified on Schedule l hereto (the "ASSIGNOR") and the
Assignee identified on Schedule l hereto (the "ASSIGNEE") agree as follows:
1. The Assignor hereby irrevocably sells and assigns to the Assignee
without recourse to the Assignor, and the Assignee hereby irrevocably
purchases and assumes from the Assignor without recourse to the Assignor, as
of the Effective Date (as defined below), the interest described in Schedule 1
hereto (the "Assigned Interest") in and to the Assignor's rights and
obligations under the Credit Agreement with respect to those credit facilities
contained in the Credit Agreement as are set forth on Schedule 1 hereto
(individually, an "Assigned Facility"; collectively, the "Assigned
Facilities"), in a principal amount for each Assigned Facility as set forth on
Schedule 1 hereto.
2. The Assignor (a) 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 with respect to the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement, any other Loan Document or any other
instrument or document furnished pursuant thereto, other than that the
Assignor has not created any adverse claim upon the interest being assigned
by it hereunder and that such interest is free and clear of any such adverse
claim; (b) makes no representation or warranty and assumes no responsibility
with respect to the financial condition of the Borrower, any of its
Subsidiaries or any other obligor or the performance or observance by the
Borrower, any of its Subsidiaries or any other obligor of any of their
respective obligations under the Credit Agreement or any other Loan Document
or any other instrument or document furnished pursuant hereto or thereto;
(c) attaches any Notes held by it evidencing the Assigned Facilities and
(i) requests that the Administrative Agent, upon request by the Assignee,
exchange the attached Notes for a new Note or Notes payable to the Assignee
and (ii) if the Assignor has retained any interest in the Assigned Facility,
requests that the Administrative Agent exchange the attached Notes for a new
Note or Notes payable to the Assignor, in each case in amounts which reflect
the assignment being made hereby (and after giving effect to any other
assignments which have become effective on the Effective Date); and
(d) represents and warrants that it has complied with all of the provisions of
Section 10.6(c) of the Credit Agreement which are applicable to it in
connection with this Assignment.
3. The Assignee (a) represents and warrants that it is legally
authorized to enter into this Assignment and Acceptance; (b) confirms that it
has received a copy of the
2
Credit Agreement, together with copies of the financial statements
delivered pursuant to subsection 4.1 thereof and such other documents and
information as it has deemed appropriate to make its own credit analysis and
decision to enter into this Assignment and Acceptance; (c) agrees that it
will, independently and without reliance upon the Assignor, the
Administrative Agent or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under the Credit
Agreement, the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto; (d) appoints and authorizes the
Administrative Agent to take such action as agent on its behalf and to
exercise such powers and discretion under the Credit Agreement, the other
Loan Documents or any other instrument or document furnished pursuant hereto
or thereto as are delegated to the Administrative Agent by the terms thereof,
together with such powers as are incidental thereto; (e) agrees that it will
be bound by the provisions of the Credit Agreement and will perform in
accordance with its terms all the obligations which by the terms of the
Credit Agreement are required to be performed by it as a Lender including, if
it is organized under the laws of a jurisdiction outside the United States,
its obligation pursuant to subsection 2.19(b) of the Credit Agreement; and
(f) represents and warrants that it has complied with all of the provisions
of Section 10.6 (c) of the Credit Agreement which are applicable to it in
connection with this Assignment.
4. The effective date of this Assignment and Acceptance shall be the
Effective Date of Assignment described in Schedule 1 hereto (the "Effective
Date"). Following the execution of this Assignment and Acceptance, it will be
delivered to the Administrative Agent for acceptance by it and recording by
the Administrative Agent pursuant to the Credit Agreement, effective as of the
Effective Date (which shall not, unless otherwise agreed to by the
Administrative Agent, be earlier than five Business Days after the date of
such acceptance and recording by the Administrative Agent).
5. Upon such acceptance and recording, from and after the Effective
Date, the Administrative Agent shall make all payments in respect of the
Assigned Interest (including payments of principal, interest, fees and other
amounts) to the Assignor for amounts which have accrued to the Effective Date
and to the Assignee for amounts which have accrued subsequent to the Effective
Date. The Assignor and the Assignee shall make all appropriate adjustments in
payments by the Administrative Agent for periods prior to the Effective Date
or with respect to the making of this assignment directly between themselves.
6. From and after the Effective Date, (a) the Assignee shall be a
party to the Credit Agreement and, to the extent provided in this Assignment
and Acceptance, have the rights and obligations of a Lender thereunder and
under the other Loan Documents and shall be bound by the provisions thereof
and (b) the Assignor shall, to the extent provided in this Assignment and
Acceptance, relinquish its rights and be released from its obligations under
the Credit Agreement.
7. This Assignment and Acceptance shall be governed by and construed
in accordance with the laws of the State of New York.
3
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Acceptance to be executed as of the date first above written by their
respective duly authorized officers on Schedule 1 hereto.
Schedule 1
to Assignment and Acceptance
Name of Assignor:
----------------------------------
Name of Assignee:
----------------------------------
Effective Date of Assignment:
----------------------
Credit Principal
Facility Assigned Amount Assigned Commitment Percentage Assigned (1)
----------------- --------------- ----------------------------------
$ %
--------- ---------
[Name of Assignee] [Name of Assignor]
By: By:
------------------------ ------------------------
Name: Name:
Title: Title:
-------------------
(1) Calculate the Commitment Percentage that is assigned to at least 15 decimal
places and show as a percentage of the aggregate commitments of all Lenders.
2
Accepted: Consented To:
THE CHASE MANHATTAN BANK, as CORE-XXXX INTERNATIONAL, INC.(2)
Administrative Agent
By: By:
-------------------------- -----------------------------
Name: Name:
Title: Title:
THE CHASE MANHATTAN BANK, as
Administrative Agent
By:
---------------------------------
Name:
Title:
CHASE MANHATTAN BANK
DELAWARE, as Issuing Bank
By:
---------------------------------
Name:
Title:
-------------------
(2) The consents of the Borrower, the Administrative Agent and the Issuing Bank
are not required unless the assignee is not an existing Lender under the
Credit Agreement.
