Exhibit 10.2
================================================================================
REVOLVING CREDIT AND GUARANTY AGREEMENT
================================================================================
AMONG
POLYMER GROUP, INC.,
A DEBTOR AND A DEBTOR-IN-POSSESSION UNDER CHAPTER 11 OF THE BANKRUPTCY CODE
AS BORROWER
AND
THE SUBSIDIARIES OF THE BORROWER NAMED HEREIN,
EACH A DEBTOR AND A DEBTOR-IN-POSSESSION UNDER CHAPTER 11 OF THE BANKRUPTCY
CODE
AS GUARANTORS
AND
THE LENDERS PARTY HERETO,
AND
JPMORGAN CHASE BANK,
AS ADMINISTRATIVE AGENT, DOCUMENTATION AGENT
AND COLLATERAL AGENT
X.X. XXXXXX SECURITIES INC.,
AS BOOK MANAGER
AND
LEAD ARRANGER
================================================================================
DATED AS OF MAY 30, 2002
================================================================================
TABLE OF CONTENTS
PAGE
----
SECTION 1. DEFINITIONS..........................................................................2
SECTION 1.01 Defined Terms................................................................2
SECTION 1.02 Terms Generally.............................................................21
SECTION 2. AMOUNT AND TERMS OF CREDIT..........................................................21
SECTION 2.01 Commitment of the Lenders...................................................21
SECTION 2.02 Borrowing Base..............................................................22
SECTION 2.03 Letters of Credit...........................................................22
SECTION 2.04 Issuance....................................................................24
SECTION 2.05 Nature of Letter of Credit Obligations Absolute.............................24
SECTION 2.06 Making of Loans.............................................................24
SECTION 2.07 Repayment of Loans; Evidence of Debt........................................25
SECTION 2.08 Interest on Loans...........................................................26
SECTION 2.09 Default Interest............................................................26
SECTION 2.10 Optional Termination or Reduction of Commitment.............................26
SECTION 2.11 Alternate Rate of Interest..................................................27
SECTION 2.12 Refinancing of Loans........................................................27
SECTION 2.13 Mandatory Prepayment; Commitment Termination; Cash Collateral...............28
SECTION 2.14 Optional Prepayment of Loans; Reimbursement of Lenders......................28
SECTION 2.15 Reserve Requirements; Change in Circumstances...............................30
SECTION 2.16 Change in Legality..........................................................31
SECTION 2.17 Pro Rata Treatment, etc.....................................................32
SECTION 2.18 Taxes.......................................................................32
SECTION 2.19 Certain Fees................................................................33
SECTION 2.20 Commitment Fee..............................................................33
SECTION 2.21 Letter of Credit Fees.......................................................33
SECTION 2.22 Nature of Fees..............................................................33
SECTION 2.23 Priority and Liens..........................................................34
SECTION 2.24 Right of Set-Off............................................................35
SECTION 2.25 Security Interest in Letter of Credit Account...............................35
SECTION 2.26 Payment of Obligations......................................................36
SECTION 2.27 No Discharge; Survival of Claims............................................36
TABLE OF CONTENTS
(CONTINUED)
SECTION 2.28 Use of Cash Collateral......................................................36
SECTION 3. REPRESENTATIONS AND WARRANTIES......................................................36
SECTION 3.01 Organization and Authority..................................................36
SECTION 3.02 Due Execution...............................................................37
SECTION 3.03 Statements Made.............................................................37
SECTION 3.04 Financial Statements........................................................37
SECTION 3.05 Ownership...................................................................38
SECTION 3.06 Liens.......................................................................38
SECTION 3.07 Compliance with Law.........................................................38
SECTION 3.08 Insurance...................................................................38
SECTION 3.09 Use of Proceeds.............................................................39
SECTION 3.10 Litigation..................................................................39
SECTION 4. CONDITIONS OF LENDING...............................................................39
SECTION 4.01 Conditions Precedent to Initial Loans and Initial Letters of Credit.........39
SECTION 4.02 Conditions Precedent to Each Loan and Each Letter of Credit.................42
SECTION 5. AFFIRMATIVE COVENANTS...............................................................43
SECTION 5.01 Financial Statements, Reports, etc..........................................43
SECTION 5.02 Corporate Existence.........................................................46
SECTION 5.03 Insurance...................................................................46
SECTION 5.04 Obligations and Taxes.......................................................46
SECTION 5.05 Notice of Event of Default, etc.............................................46
SECTION 5.06 Access to Books and Records.................................................46
SECTION 5.07 Maintenance of Concentration Account........................................47
SECTION 5.08 Borrowing Base Certificate..................................................47
SECTION 5.09 Collateral Monitoring and Review............................................47
SECTION 5.10 Business Plan...............................................................47
SECTION 6. NEGATIVE COVENANTS..................................................................47
SECTION 6.01 Liens.......................................................................48
SECTION 6.02 Merger, etc.................................................................48
SECTION 6.03 Indebtedness................................................................48
ii
TABLE OF CONTENTS
(CONTINUED)
SECTION 6.04 Capital Expenditures........................................................48
SECTION 6.05 EBITDA......................................................................49
SECTION 6.06 Guarantees and Other Liabilities............................................50
SECTION 6.07 Chapter 11 Claims...........................................................50
SECTION 6.08 Dividends; Capital Stock....................................................50
SECTION 6.09 Transactions with Affiliates................................................50
SECTION 6.10 Investments, Loans and Advances.............................................50
SECTION 6.11 Disposition of Assets.......................................................51
SECTION 6.12 Nature of Business..........................................................51
SECTION 7. EVENTS OF DEFAULT...................................................................51
SECTION 7.01 Events of Default...........................................................51
SECTION 8. THE AGENT...........................................................................54
SECTION 8.01 Administration by Agent.....................................................54
SECTION 8.02 Advances and Payments.......................................................54
SECTION 8.03 Sharing of Setoffs..........................................................55
SECTION 8.04 Agreement of Required Lenders...............................................55
SECTION 8.05 Liability of Agent..........................................................56
SECTION 8.06 Reimbursement and Indemnification...........................................56
SECTION 8.07 Rights of Agent.............................................................57
SECTION 8.08 Independent Lenders.........................................................57
SECTION 8.09 Notice of Transfer..........................................................57
SECTION 8.10 Successor Agent.............................................................57
SECTION 9. GUARANTY............................................................................57
SECTION 9.01 Guaranty....................................................................57
SECTION 9.02 No Impairment of Guaranty...................................................58
SECTION 9.03 Subrogation.................................................................59
SECTION 10. MISCELLANEOUS.......................................................................59
SECTION 10.01 Notices.....................................................................59
SECTION 10.02 Survival of Agreement, Representations and Warranties, etc..................59
SECTION 10.03 Successors and Assigns......................................................59
iii
TABLE OF CONTENTS
(CONTINUED)
SECTION 10.04 Confidentiality.............................................................62
SECTION 10.05 Expenses....................................................................62
SECTION 10.06 Indemnity...................................................................62
SECTION 10.07 CHOICE OF LAW...............................................................63
SECTION 10.08 No Waiver...................................................................63
SECTION 10.09 Extension of Maturity.......................................................63
SECTION 10.10 Amendments, etc.............................................................63
SECTION 10.11 Severability................................................................64
SECTION 10.12 Headings....................................................................64
SECTION 10.13 Execution in Counterparts...................................................64
SECTION 10.14 Prior Agreements............................................................64
SECTION 10.15 Further Assurances..........................................................65
SECTION 10.16 WAIVER OF JURY TRIAL........................................................65
ANNEX A Commitment Amounts
EXHIBIT A - Form of Interim Order
EXHIBIT B - Form of Security and Pledge Agreement
EXHIBIT C - Form of Opinion of Counsel
EXHIBIT D - Form of Assignment and Acceptance
EXHIBIT E - Form of Borrowing Base Certificate
SCHEDULE 1.01 - Existing Agreement
SCHEDULE 3.04 - Material Adverse Effect
SCHEDULE 3.05 - Subsidiaries
SCHEDULE 3.06 - Liens
SCHEDULE 3.10 - Litigation
SCHEDULE 6.09 - Transactions with Shareholders
SCHEDULE 6.10 - Existing Investments
SCHEDULE 6.11 - Sale of Marketable Securities
iv
REVOLVING
CREDIT AND GUARANTY AGREEMENT
DATED AS OF MAY 30, 2002
REVOLVING
CREDIT AND GUARANTY AGREEMENT, dated as of May 30, 2002,
among POLYMER GROUP, INC., a Delaware corporation (the "BORROWER"), a debtor and
debtor-in-possession in a case pending under Chapter 11 of the Bankruptcy Code,
the direct and indirect domestic subsidiaries of the Borrower signatory hereto
(each a "GUARANTOR" and collectively, the "GUARANTORS"), each of which
Guarantors is a debtor and debtor-in-possession in a case pending under Chapter
11 of the Bankruptcy Code (the cases of the Borrower and the Guarantors, each a
"CASE" and collectively, the "CASES"), JPMORGAN CHASE BANK, a New York banking
corporation ("JPMORGAN CHASE"), each of the other financial institutions from
time to time party hereto (together with JPMorgan Chase, the "LENDERS") and
JPMORGAN CHASE BANK, as administrative agent (in such capacity, the "AGENT") for
the Lenders.
INTRODUCTORY STATEMENT
On May 11, 2002, the Borrower and the Guarantors filed voluntary
petitions with the Bankruptcy Court initiating the Cases and have continued in
the possession of their assets and in the management of their business pursuant
to Sections 1107 and 1108 of the Bankruptcy Code.
The Borrower has applied to the Lenders for a revolving credit and
letter of credit facility in an aggregate principal amount not to exceed
$125,000,000, all of the Borrower's obligations under which are to be guaranteed
by the Guarantors.
The proceeds of the Loans will be used for general corporate purposes
of the Borrower and the Guarantors (including, but only to the extent permitted
under Section 6.10, for loans and advances to Subsidiaries not party hereto).
To provide guarantees and security for the repayment of the Loans, the
reimbursement of any draft drawn under a Letter of Credit and the payment of the
other obligations of the Borrower and the Guarantors hereunder and under the
other Loan Documents (including, without limitation, the Obligations of the
Borrower and the Guarantors to JPMorgan Chase and its banking Affiliates
permitted by Section 6.03(vi)), the Borrower and the Guarantors will provide to
the Agent and the Lenders the following (each as more fully described herein):
(a) a guaranty from each of the Guarantors of the due and punctual payment
and performance of the obligations of the Borrower hereunder;
(b) an allowed administrative expense claim in each of the Cases pursuant
to Section 364(c)(1) of the Bankruptcy Code having joint and several
superpriority over all administrative expenses of the kind specified in Sections
503(b) and 507(b) of the Bankruptcy Code;
(c) a perfected first priority Lien, pursuant to Section 364(c)(2) of the
Bankruptcy Code, upon all property of the Borrower and the Guarantors'
respective estates in the Cases that is not subject to valid, perfected and
non-avoidable liens on the Filing Date, including, without limitation, all
accounts receivable, inventory, property, plant and equipment of the Borrower
and
Guarantors (excluding the Borrower's and the Guarantors' rights in respect of
avoidance actions under the Bankruptcy Code) and on all cash and cash
equivalents in the Letter of Credit Account;
(d) a perfected Lien, pursuant to Section 364(c)(3) of the Bankruptcy
Code, upon all property of the Borrower and the Guarantors' respective estates
in the Cases (other than the property referred to in paragraph (e) below that is
subject to the valid and perfected Liens that presently secure the Borrower's
and Guarantors' pre-petition Indebtedness under the Existing Agreement) that is
subject to valid, perfected and non-avoidable Liens in existence on the Filing
Date or that is subject to valid Liens in existence on the Filing Date that are
perfected subsequent to the Filing Date as permitted by Section 546(b) of the
Bankruptcy Code or that is subject to Permitted Liens, junior to such valid,
perfected and non-avoidable Liens; and
(e) perfected first priority senior priming Liens, pursuant to Section
364(d)(1) of the Bankruptcy Code, upon all property of the Borrower and the
Guarantors that is subject to (x) the existing Liens that presently secure the
Borrower's and Guarantors' pre-petition Indebtedness under or in connection with
that certain Second Amended, Restated and Consolidated Credit Agreement dated as
of July 3, 1997, as amended, among the Borrower, Chicopee Holdings B.V., PGI
Nonwovens B.V., Fabrene Inc., the secured lenders from time to time party
thereto and JPMorgan Chase Bank, as administrative agent, JPMorgan Chase Bank,
as issuing lender, and The Bank of Nova Scotia, BHF Bank, Corestates Bank, N.A.,
and First Union National Bank, each as co-agent (as amended, the "EXISTING
AGREEMENT") (but subject to any Liens to which the Liens being primed hereby are
subject on the Filing Date or become subject subsequent to the Filing Date as
permitted by Section 546(b) of the Bankruptcy Code) and (y) any Liens granted
after the Filing Date to provide adequate protection in respect of the Existing
Agreement, which first priority priming Liens in favor of the Agent and the
Lenders shall be senior in all respects to all of such existing Liens under or
in connection with the Existing Agreement, and to any Liens granted after the
Filing Date to provide adequate protection in respect thereof;
All of the claims and the Liens granted hereunder in the Cases to the
Agent and the Lenders shall be subject to the Carve-Out to the extent provided
in Section 2.23.
Accordingly, the parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
SECTION 1.01 DEFINED TERMS.
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any Loan bearing interest at a rate determined
by reference to the Alternate Base Rate in accordance with the provisions of
Section 2.
"ACCOUNT" shall mean any right to payment for goods sold or leased or
for services rendered, whether or NOT earned by performance.
"ACCOUNT DEBTOR" shall mean, with respect to any Account, the obligor
with respect to such Account.
2
"ADDITIONAL CREDIT" shall have the meaning given such term in Section
4.02(d) hereof.
"ADJUSTED ELIGIBLE ACCOUNTS RECEIVABLE" shall mean Eligible Accounts
Receivable for the Borrower and the Guarantors minus the Dilution Reserve.
"ADJUSTED LIBOR RATE" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the quotient of (a) the LIBOR
Rate in effect for such Interest Period divided by (b) a percentage (expressed
as a decimal) equal to 100% minus Statutory Reserves. For purposes hereof, the
term "LIBOR RATE" shall mean the rate at which dollar deposits approximately
equal in principal amount to such Eurodollar Borrowing and for a maturity
comparable to such Interest Period are offered to the principal London office of
the Agent in immediately available funds in the London interbank market at
approximately 11:00 a.m., London time, two Business Days prior to the
commencement of such Interest Period.
"AFFILIATE" shall mean, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. For purposes of this definition, a Person (a
"CONTROLLED PERSON") shall be deemed to be "controlled by" another Person (a
"CONTROLLING PERSON") if the Controlling Person possesses, directly or
indirectly, power to direct or cause the direction of the management and
policies of the Controlled Person whether by contract or otherwise.
"AGENT" shall have the meaning set forth in the Introduction.
"AGREEMENT" shall mean this Revolving
Credit and Guaranty Agreement,
as the same may from time to time be further amended, modified or supplemented.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum 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 Agent
as its prime rate in effect at its principal office in New York City; each
change in the Prime Rate shall be effective on the date such change is publicly
announced. "BASE CD RATE" shall mean the sum of (a) the quotient of (i) the
Three-Month Secondary CD Rate divided by (ii) a percentage expressed as a
decimal equal to 100% minus Statutory Reserves and (b) the 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 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 Agent from three New York City negotiable certificate of
deposit dealers of recognized standing selected by it. "FEDERAL FUNDS
3
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 Agent from three Federal funds
brokers of recognized standing selected by it. If for any reason the Agent shall
have determined (which determination shall be conclusive absent manifest error)
that it is unable to ascertain the Base CD Rate or the Federal Funds Effective
Rate or both for any reason, including the inability or failure of the Agent to
obtain sufficient quotations in accordance with the terms hereof, the Alternate
Base Rate shall be determined without regard to clause (b) or (c), or both, of
the first sentence of this definition, as appropriate, until the circumstances
giving rise to such inability no longer exist. Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Three-Month Secondary CD Rate or the
Federal Funds Effective Rate shall be effective on the effective date of such
change in the Prime Rate, the Three-Month Secondary CD Rate or the Federal Funds
Effective Rate, respectively.
"ASSESSMENT RATE" shall mean for any date the annual rate (rounded
upwards, if necessary, to the next 1/100 of 1%) most recently estimated by the
Agent as the then current net annual assessment rate that will be employed in
determining amounts payable by the Agent to the Federal Deposit Insurance
Corporation (or any successor) for insurance by such Corporation (or any
successor) of time deposits made in dollars at the Agent's domestic offices.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the Agent,
substantially in the form of Exhibit D.
"AVAILABLE MACHINERY AND EQUIPMENT" shall mean, at the time of any
determination thereof, an amount equal to 50% of the remainder of (x) the
liquidation value in place in the amount of $121,500,000 of certain machinery
and equipment owned by the Borrower and the Guarantors as of the Filing Date
LESS (y) the gross proceeds received by the Borrower and the Guarantors from
dispositions of machinery and equipment subsequent to the Filing Date.
"BANKRUPTCY CODE" shall mean The Bankruptcy Reform Act of 1978, as
heretofore and hereafter amended, and codified as 11 U.S.C. Section 101 ET SEQ.
"BANKRUPTCY COURT" shall mean the United States Bankruptcy Court for
the District of South Carolina or any other court having jurisdiction over the
Cases from time to time.
"BOARD" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"BORROWER" shall have the meaning set forth in the Introduction.
"BORROWING" shall mean the incurrence of Loans of a single Type made
from all the Lenders on a single date and having, in the case of Eurodollar
Loans, a single Interest Period
4
(with any ABR Loan made pursuant to Section 2.16 being considered a part of the
related Borrowing of Eurodollar Loans).
"BORROWING BASE" shall mean, on any date, the amount (calculated based
on the most recent Borrowing Base Certificate delivered pursuant to this
Agreement) that is equal to (a) 85% of Adjusted Eligible Accounts Receivable,
PLUS (b) 60% of Eligible Inventory of NWD and 25% of Eligible Inventory of OPD,
PLUS (c) 25% of Chemicals and Additives (not to exceed $500,000) PLUS (d)
Available Machinery and Equipment MINUS (e) the Carve-Out; PROVIDED, that (i)
the amount derived from clause (b) above shall at no time exceed the amount
derived from clause (a) above and (ii) the amount derived from clause (d) above
shall at no time exceed the lesser of $60,000,000 and 60% of the Borrowing Base
inclusive of clause (d). Borrowing Base eligibility standards may be determined
from time to time by the Agent in its sole discretion, and the Borrowing Base
shall be subject to reserves from time to time established by the Agent with any
changes in such standards and reserves to be effective five (5) days after
delivery of notice thereof to the Borrower.
"BORROWING BASE CERTIFICATE" shall mean a certificate substantially in
the form of Exhibit E hereto (with such changes therein as may be required by
the Agent to reflect the components of and reserves against the Borrowing Base
as provided for hereunder from time to time), executed and certified as accurate
and complete by a Financial Officer of the Borrower, which shall include
appropriate exhibits and schedules as referred to therein and as provided for in
Section 5.08.
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or
other day on which banks in the State of New York are required or permitted to
close (and, for a Letter of Credit, other than a day on which the Fronting Bank
issuing such Letter of Credit is closed); provided, however, that when used in
connection with a Eurodollar Loan, the term "Business Day" shall also exclude
any day on which banks are not open for dealings in dollar deposits on the
London interbank market.
"CAPITAL EXPENDITURES" shall mean, for any period, the aggregate of
all expenditures (whether ((euro)) paid in cash and not theretofore accrued or
(ii) accrued as liabilities during such period, and including that portion of
any post-petition Capitalized Lease which is capitalized on the consolidated
balance sheet of the Borrower and the Guarantors) net of cash amounts received
by the Borrower and the Guarantors from other Persons during such period in
reimbursement of Capital Expenditures made by the Borrower and the Guarantors,
excluding interest capitalized during construction, made by the Borrower and the
Guarantors during such period that, in conformity with GAAP, are required to be
included in or reflected by the property, plant, equipment or similar fixed
asset accounts reflected in the consolidated balance sheet of the Borrower and
the Guarantors (including equipment which is purchased simultaneously with the
trade-in of existing equipment owned by the Borrower or any of the Guarantors to
the extent of the gross amount of such purchase price less the book value of the
equipment being traded in at such time), but excluding expenditures made in
connection with the replacement or restoration of assets to the extent
reimbursed or financed from (x) insurance proceeds paid on account of the loss
of or the damage to the assets being replaced or restored or (y) awards of
compensation arising from the taking by condemnation or eminent domain of such
assets being replaced.
5
"CAPITALIZED LEASE" shall mean, as applied to any Person, any lease of
property by such Person as lessee which would be capitalized on a balance sheet
of such Person prepared in accordance with GAAP.
"CARVE-OUT" shall have the meaning set forth in Section 2.23.
"CASES" shall have the meaning set forth in the Introduction.
"CHANGE OF CONTROL" shall mean (i) the acquisition of ownership,
directly or indirectly, beneficially or of record, by any Person or group
(within the meaning of the Securities Exchange Act of 1934 and the rules of the
Securities and Exchange Commission thereunder as in effect on the date hereof),
of shares representing more than 50% of the aggregate ordinary voting power
represented by the issued and outstanding capital stock of the Borrower; or (ii)
the occupation of a majority of the seats (other than vacant seats) on the Board
of Directors of the Borrower by Persons who were neither (A) nominated by the
Board of Directors of the Borrower nor (B) appointed by directors so nominated.
"CHEMICALS AND ADDITIVES" shall mean chemicals and additives, as
historically referred to by the Borrower or the Guarantors in their accounting
records, used or consumed in the production of goods to be sold by the Borrower
or the Guarantors in the ordinary course of business, such as pigments, dyes and
adhesives used in the manufacturing process but excluding certain chemicals and
additives as determined by the Agent.
"CLOSING DATE" shall mean the date on which this Agreement has been
executed and the conditions precedent to the making of the initial Loans set
forth in Section 4.01 have been satisfied or waived, which date shall occur
promptly upon entry of the Interim Order, but not later than 10 days following
the entry of the Interim Order.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and rulings issued thereunder.
"COLLATERAL" shall mean the "Collateral" as defined in the Security
and Pledge Agreement.
"COMMITMENT" shall mean, with respect to each Lender, the commitment
of each Lender hereunder in the amount set forth opposite its name on Annex A
hereto or as may subsequently be set forth in the Register from time to time, as
the same may be reduced from time to time pursuant to this Agreement.
"COMMITMENT FEE" shall have the meaning set forth in Section 2.20.
"COMMITMENT LETTER" shall mean that certain Commitment Letter dated
February 1, 2002, among the Agent, X.X. Xxxxxx Securities Inc. and the Borrower.
"COMMITMENT PERCENTAGE" shall mean at any time, with respect to each
Lender, the percentage obtained by dividing its Commitment at such time by the
Total Commitment at such time.
6
"CONSUMMATION DATE" shall mean the date of the substantial
consummation (as defined in Section 1101 of the Bankruptcy Code and which for
purposes of this Agreement shall be no later than the effective date) of a
Reorganization Plan that is confirmed pursuant to an order of the Bankruptcy
Court.
"DILUTION PERCENTAGE" shall vary for each of the Borrower and the
Guarantors (as applicable), shall be updated monthly, and shall mean the
quotient, expressed as a percentage, of (i) the aggregate of all deductions,
including credit memos, returns, adjustments, allowances and bad-debt
write-offs, and other non-cash credits which are recorded to reduce accounts
receivable for the (12) twelve most recently ended fiscal months, divided by
(ii) the gross xxxxxxxx during the same (12) month period.
"DILUTION RESERVE" shall mean an amount equal to the product of (A)
the Dilution Percentage multiplied by (B) the amount that would constitute
Eligible Accounts Receivable prior to the implementation of the Dilution
Reserve.
"DOLLARS" and "$" shall mean lawful money of the United States of
America.
"EBITDA" shall mean, for any period, all as determined in accordance
with GAAP, the consolidated net income (or net loss) of the Borrower and the
Guarantors or the Borrower and its Subsidiaries, as the case may be, for such
period, PLUS (a) the sum of (i) depreciation expense, (ii) amortization expense,
(iii) other non-cash expenses, (iv) consolidated federal, state and local income
tax expense, (v) gross interest expense for such period less gross interest
income for such period, (vi) extraordinary losses, (vii) any non-recurring
charge or restructuring charge, (viii) the cumulative effect of any change in
accounting principles, (ix) "Chapter 11 expenses" (or "administrative costs
reflecting Chapter 11 expenses") as shown on the Borrower's consolidated
statement of income for such period and (x) any loss on the sale of marketable
securities held by the Borrower at the time of the commencement of the Cases in
a cumulative amount not to exceed $7,000,000 LESS (b) extraordinary gains PLUS
or MINUS (c) the amount of cash received or expended in such period in respect
of any amount which, under clause (vii) above, was taken into account in
determining EBITDA for such or any prior period.
"ELIGIBLE ACCOUNTS RECEIVABLE" shall mean, at the time of any
determination thereof, the gross outstanding balance at such time, determined in
accordance with GAAP and stated on a basis consistent with the historical
practices of the Borrower or the Guarantors (as applicable) as of the date
hereof, of Accounts of the Borrower or the Guarantors (as the case may be) less,
as applicable and without duplication, the aggregate amount of (i) all accrued
rebates, (ii) all trade discounts, (iii) all finance charges, late fees and
other fees that are unearned, (iv) all reserves for service fees and such other
fees or commissions or similar amounts that the Borrower or the Guarantors (as
applicable) have agreed to pay, (v) all cash received in respect of Accounts but
not yet applied by the Borrower or the Guarantors (as applicable) to reduce the
amount of the Accounts, (vi) the aggregate amount of all other reserves
(including the Reserve for Customers With Extended Terms) and (vii) any Account
deemed ineligible for inclusion in the calculation of the Borrowing Base
pursuant to any of clauses (a) through (q) below or otherwise deemed by the
Agent in its reasonable discretion to be ineligible for inclusion in the
calculation of the Borrowing Base as described below. Without limiting the
foregoing, to qualify as an Eligible Account Receivable, an Account shall
indicate as sole payee and as sole
7
remittance party the Borrower or a Guarantor (as the case may be). Standards of
eligibility may be adjusted from time to time solely by the Agent in the
exercise of its reasonable discretion, with any changes in such standards to be
effective five (5) days after delivery of notice thereof to the Borrower. Unless
otherwise approved from time to time in writing by the Agent, no Account shall
be an Eligible Account Receivable if, without duplication:
(a) the Borrower or a Guarantor (as applicable) does not have sole
lawful and absolute title to such Account; or
(b) it arises out of a sale made by the Borrower or a Guarantor to
an employee, officer, agent, director, stockholder, or Affiliate of the
Borrower or a Guarantor; or
(c) the Account Debtor (i) is a creditor of the Borrower or a
Guarantor (as applicable), (ii) has or has asserted a right of set-off
against the Borrower or a Guarantor (as applicable), including co-op
advertising (unless such Account Debtor has entered into a written
agreement reasonably acceptable to the Agent to waive such set-off rights)
or (iii) has disputed its liability (whether by chargeback or otherwise) or
made any asserted or unasserted claim with respect to the Account or any
other Account of the Borrower or the Guarantor (as applicable) which has
not been resolved, in each case, without duplication, to the extent of the
amount owed by such Borrower or Guarantor (as applicable) to the Account
Debtor, the amount of such actual or asserted right of set-off, or the
amount of such dispute or claim, as the case may be; or
(d) the Account Debtor is insolvent, has an unsatisfactory credit
standing or is the subject of any bankruptcy case or insolvency proceeding
of any kind (other than post-petition accounts payable of an Account Debtor
that is a debtor-in-possession under the Bankruptcy Code and acceptable to
the Agent); or
(e) the Account is not payable in United States Dollars or the
Account Debtor is either not incorporated under the laws of the United
States of America, any state thereof or the District of Columbia or is
located outside the United States or has its principal place of business or
substantially all of its assets outside the United States; or
(f) the sale to the Account Debtor is a xxxx and hold sale
agreement, guaranteed sale, sale-and-return, ship-and-return, sale on
approval, extended terms (except for those Accounts that are subject to the
Reserve for Customers with Extended Terms) or on consignment or other
similar basis or made pursuant to any other agreement providing for
repurchase or return of any merchandise which has been claimed to be
defective or otherwise unsatisfactory; or
(g) the goods giving rise to such Account have not been shipped and
title has not been transferred to the Account Debtor, or the Account
represents a progress-billing or otherwise does not represent a completed
sale; for purposes hereof, "progress-billing" means any invoice for goods
sold or leased or services rendered under a contract or agreement pursuant
to which the Account Debtor's obligation to pay such invoice is
8
conditioned upon the Borrower or the Guarantor's (as applicable) completion
of any further performance under the contract or agreement; or
(h) the Account does not comply in all material respects with the
requirements of all applicable laws and regulations, whether Federal, state
or local, including without limitation the Federal Consumer Credit
Protection Act, the Federal Truth in Lending Act and Regulation Z of the
Board; or
(i) the Account is subject to any adverse security deposit, retainage
or other similar advance made by or for the benefit of the Account Debtor,
in each case to the extent thereof; or
(j) the Account is unpaid more than 60 days from the original due
date, or 90 days from the original date of invoice (except for those
Accounts that are subject to the Reserve for Customers with Extended
Terms); or
(k) such Account was not paid in full, and the Borrower or Guarantor
(as applicable) created a new receivable for the unpaid portion of the
Account, without the agreement of the customer, including without
limitation chargebacks, debit memos and other adjustments for unauthorized
deductions; or
(l) more than 50% of all Accounts of the particular Account Debtor
are unpaid more than 60 days from the original due date or more than 90
days from the original invoice date (except for those Accounts that are
subject to the Reserve for Customers With Extended Terms), in which case no
Account of the particular Account Debtor shall be included within Eligible
Accounts Receivable; or
(m) such Account (i) is not subject to a valid and perfected first
priority Lien in favor of the Agent for the benefit of the Secured Parties,
subject to no other Liens other than the Liens (if any) permitted by the
Loan Documents or (ii) does not otherwise conform in all material respects
to the representations and warranties contained in the Loan Documents
relating to Accounts; or
(n) as to all or any part of such Account, a check, promissory
note, draft, trade acceptance or other Instrument for the payment of money
has been received, presented for payment and returned uncollected for any
reason; or
(o) it has been written off the books of the Borrower or the
Guarantors (as applicable) has been otherwise designated as uncollectible;
or
(p) the Account is a non-trade Account, or relates to payments for
interest; or
(q) the Account Debtor is the United States of America or any
department, agency or instrumentality thereof, unless (A) the Company, duly
assigns its rights to payment of such Account to the Agent pursuant to the
Assignment of Claims Act of 1940, as amended, which assignment and related
documents and filings shall be in form and substance reasonably
satisfactory to the Agent or (B) the amount of such Account is less than
10% of the gross trades account receivables.
9
Notwithstanding the foregoing, all Accounts of any single Account Debtor and its
Affiliates which, in the aggregate, exceed (i) 20% of the total Eligible
Accounts Receivable of Account Debtors whose securities are rated Investment
Grade or (ii) 5% of the total Eligible Accounts Receivable of Account Debtors
whose securities are not rated Investment Grade, shall be deemed not to be
Eligible Accounts Receivable to the extent of such excess. In determining the
aggregate amount of Accounts from the same Account Debtor that are unpaid more
than 60 days from the due date or more than 90 days from the original date of
invoice pursuant to clause (l) above, there shall be excluded the amount of any
net credit balances relating to Accounts more than 60 days from the due date.
"ELIGIBLE ASSIGNEE" shall mean (i) a commercial bank having total
assets in excess of $1,000,000,000; (ii) a finance company, insurance company or
other financial institution or fund, in each case reasonably acceptable to the
Agent, which in the ordinary course of business extends credit of the type
contemplated herein and has total assets in excess of $200,000,000; (iii) a
Lender Affiliate of the assignor Lender; and (iv) any other financial
institution satisfactory to the Borrower (but only for so long as an Event of
Default shall not have occurred and be continuing) and the Agent.
"ELIGIBLE INVENTORY" shall mean, at the time of any determination
thereof, without duplication, the Inventory Value of the Borrower or the
Guarantors (as applicable) at the time of such determination that is not
ineligible for inclusion in the calculation of the Borrowing Base pursuant to
any of clauses (a) through (n) below, minus Inventory Reserves, minus any
Inventory otherwise deemed by the Agent in good faith to be ineligible for
inclusion in the calculation of the Borrowing Base. Without limiting the
foregoing, to qualify as "Eligible Inventory" no person other than the Borrower
or the Guarantors (as applicable) shall have any direct or indirect ownership,
interest or title to such Inventory and no person other than the Borrower or the
Guarantors (as applicable) shall be indicated on any purchase order or invoice
with respect to such Inventory as having or purporting to have an interest
therein. Standards of eligibility may be adjusted from time to time solely by
the Agent in the exercise of its reasonable judgment, with any changes in such
standards to be effective five (5) days after delivery of notice thereof to the
Borrower or the Guarantors (as applicable). Unless otherwise from time to time
approved in writing by the Agent, no Inventory shall be deemed Eligible
Inventory if, without duplication:
(a) the Borrower or the Guarantors do not have sole and good, valid
and unencumbered title (subject only to Permitted Liens described in
clauses (i), (ii) and (iii) of the definition of Permitted Liens or the
Liens granted pursuant to the Existing Agreement) thereto; or
(b) it is not located in the United States; or
(c) except to the extent covered by the second proviso to clause (j)
below, it is not located on property owned or leased by the Borrower or a
Guarantor (as applicable) or, is located in a third party warehouse unless
subject to a reasonably acceptable collateral access agreement; or
(e) it is supplies, packaging or shipping materials, cartons, repair
parts, labels, demonstrations, display or miscellaneous spare parts; or
10
(f) it is not subject to a valid and perfected first priority Lien in
favor of the Agent for the benefit of the Secured Parties; or
(g) it is classified as stock in process or Work in Process by the
Borrower or the Guarantor (as applicable); or
(h) it is waste film, as currently and historically defined by the
Borrower or the Guarantor (as applicable); or
(i) except to the extent covered by the second proviso to clause (j)
below, it is consigned or at a customer location but still accounted for in
the Borrower or the Guarantor's (as applicable) perpetual inventory
balance; or
(j) it is Inventory which is being processed offsite at a third party
location, outside processor or converter, is located at the Berkeley
Medical Resources, Inc. conversion plant, is located at the Guntown, MS
plant (provided that the Inventory at such plant shall be included in
Eligible Inventory only after the Agent has completed a due diligence
review thereof with results satisfactory to the Agent), or is in-transit to
or from the said third party location, outside processor or converter;
PROVIDED THAT, upon the execution of a collateral access agreement, in form
and substance satisfactory to the Agent, by Berkeley Medical Resources,
Inc., Inventory located at the Berkeley Medical Resources, Inc. conversion
plant shall be deemed Eligible Inventory; or
(k) it is seconds or thirds, damaged, scrap, defective, discontinued,
returns, rejects or is designated by the Borrower or a Guarantor (as
applicable) as obsolete, unmerchantable, not in good condition, return to
vendor or otherwise unsaleable in the ordinary course of business; or
(l) it is in-transit to or from a foreign location, or is part of a
xxxx and hold arrangement from a vendor, or is inventory on hold as
currently and historically defined by the Borrower or a Guarantor (as
applicable), or shipped "sale or return", or which has not yet been
received into a facility owned or operated by the Borrower or a Guarantor;
or
(m) it is Chemicals and Additives; or
(n) it is Raw Materials consumed in the Borrower or the Guarantor's
(as applicable) production process but not removed from Raw Materials.
"ENVIRONMENTAL LIEN" shall mean a Lien in favor of any Governmental
Authority for (i) any liability under federal or state environmental laws or
regulations, or (ii) damages arising from or costs incurred by such Governmental
Authority in response to a release or threatened release of a hazardous or toxic
waste, substance or constituent, or other substance into the environment.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
11
"ERISA AFFILIATE" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or a Subsidiary of the Borrower would
be deemed to be a single employer within the meaning of Section 414(b), (c),
(m), or (o) of the Code.
"EUROCURRENCY LIABILITIES" shall have the meaning assigned thereto in
Regulation D issued by the Board, as in effect from time to time.
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of Eurodollar
Loans.
"EURODOLLAR LOAN" shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of Section 2.
"EVENT OF DEFAULT" shall have the meaning given such term in
Section 7.
"EXCLUDED TAXES" shall mean, with respect to the Agent, any Lender,
the Fronting Bank or any other recipient of any payment to be made by or on
account of any obligation of the Borrower hereunder, (a) income or franchise
taxes imposed on (or measured by) its net income by the United States of
America, or by the jurisdiction under the laws of which such recipient is
organized or in which its principal office is located or, in the case of any
Lender, in which its applicable lending office is located, (b) any branch
profits taxes imposed by the United States of America or any similar tax imposed
by any other jurisdiction in which the Borrower is located and (c) in the case
of a Foreign Lender, any withholding tax that is imposed on amounts payable to
such Foreign Lender at the time such Foreign Lender becomes a party to this
Agreement (or designates a new lending office) or is attributable to such
Foreign Lender's failure to comply with Section 2.18(e), except to the extent
that such Foreign Lender (or its assignor, if any) was entitled, at the time of
designation of a new lending office (or assignment), to receive additional
amounts from the Borrower with respect to such withholding tax pursuant to
Section 2.18(a).
"EXISTING AGREEMENT" shall have the meaning set forth in the
Introduction and shall include all of the agreements granting security interests
and Liens in property and assets of the Borrower and the Guarantors to the
Existing Lenders, including without limitation, the security agreements,
mortgages and leasehold mortgages listed on Schedule 1.01 hereto, each of which
documents was executed and delivered (to the extent party thereto) by the
Borrower and the Guarantors prior to the Filing Date, as each may have been
amended or modified from time to time.
"EXISTING LENDERS" shall mean, collectively, the lenders under the
Existing Agreement, together with any successors or assigns thereof.
"FABPRO" shall mean Fabpro Oriented Polymers, Inc., a subsidiary of
the Borrower referred to as Fabpro and part of OPD.
"FABRENE" shall mean Fabrene Corp. and Fabrene Group LLC, subsidiaries
of the Borrower referred to as Fabrene and part of OPD.
"FEES" shall collectively mean the Commitment Fees, Letter of Credit
Fees and other fees referred to in Sections 2.19, 2.20 and 2.21.
12
"FILING DATE" shall mean May 11, 2002.
"FINAL ORDER" shall have the meaning given such term in Section
4.02(d).
"FINANCIAL OFFICER" shall mean the Chief Financial Officer, Principal
Accounting Officer, Controller or Treasurer of the Borrower.
"FINISHED GOODS" shall mean completed goods which require no
additional processing, to be sold by the Borrower or the Guarantors (as
applicable) in the ordinary course of business.
"FOREIGN LENDER" means any Lender that is organized under the laws of
a jurisdiction other than that in which the Borrower is located. For purposes of
this definition, the United States of America, each State thereof and the
District of Columbia shall be deemed to constitute a single jurisdiction.
"FRONTING BANK" shall mean JPMorgan Chase (or any of its banking
Affiliates) or such other Lender that is a commercial bank (which other Lender
shall be reasonably satisfactory to the Borrower and JPMorgan Chase) as may
agree with JPMorgan Chase to act in such capacity.
"GAAP" shall mean generally accepted accounting principles applied in
accordance with Section 1.02.
"GOVERNMENTAL AUTHORITY" shall mean any Federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality or any court, in each case whether of the United States or
foreign.
"GUARANTOR" shall have the meaning set forth in the Introduction.
"INDEBTEDNESS" shall mean, at any time and with respect to any Person,
(i) all indebtedness of such Person for borrowed money, (ii) all indebtedness of
such Person for the deferred purchase price of property or services (other than
property, including inventory, and services purchased, and expense accruals and
deferred compensation items arising, in the ordinary course of business), (iii)
all obligations of such Person evidenced by notes, bonds, debentures or other
similar instruments (other than performance, surety and appeal bonds arising in
the ordinary course of business), (iv) all indebtedness of such Person created
or arising under any conditional sale or other title retention agreement with
respect to property acquired by such Person (even though the rights and remedies
of the seller or lender under such agreement in the event of default are limited
to repossession or sale of such property), (v) all obligations of such Person
under Capitalized Leases, (vi) all reimbursement, payment or similar obligations
of such Person, contingent or otherwise, under acceptance, letter of credit or
similar facilities and all obligations of such Person in respect of (x) currency
swap agreements, currency future or option contracts and other similar
agreements designed to hedge against fluctuations in foreign interest rates and
(y) interest rate swap, cap or collar agreements and interest rate future or
option contracts; (vii) all Indebtedness referred to in clauses (i) through (vi)
above guaranteed directly or indirectly by such Person, or in effect guaranteed
directly or indirectly by such Person through an agreement (A) to pay or
purchase such Indebtedness or to advance or supply funds for the
13
payment or purchase of such Indebtedness, (B) to purchase, sell or lease (as
lessee or lessor) property, or to purchase or sell services, primarily for the
purpose of enabling the debtor to make payment of such Indebtedness or to assure
the holder of such Indebtedness against loss in respect of such Indebtedness,
(C) to supply funds to or in any other manner invest in the debtor (including
any agreement to pay for property or services irrespective of whether such
property is received or such services are rendered) or (D) otherwise to assure a
creditor against loss in respect of such Indebtedness, and (viii) all
Indebtedness referred to in clauses (i) through (vii) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, even though such
Person has not assumed or become liable for the payment of such Indebtedness.
"INDEMNIFIED TAXES" shall mean Taxes other than Excluded Taxes.
"INSUFFICIENCY" shall mean, with respect to any Plan, its "amount of
unfunded benefit liabilities" within the meaning of Section 4001(a)(18) of
ERISA, if any.
"INTERIM ORDER" shall have the meaning given such term in Section
4.01(b).
"INTEREST PAYMENT DATE" shall mean (i) as to any Eurodollar Loan, the
last day of each consecutive 30 day period running from the commencement of the
applicable Interest Period, and (ii) as to all ABR Loans, the last calendar day
of each month and the date on which any ABR Loans are refinanced with Eurodollar
Loans pursuant to Section 2.12.
"INTEREST PERIOD" shall mean, as to any Borrowing of Eurodollar Loans,
the period commencing on the date of such Borrowing (including as a result of a
refinancing of ABR Loans) or on the last day of the preceding Interest Period
applicable to such Borrowing and ending on the numerically corresponding day (or
if there is no corresponding day, the last day) in the calendar month that is
one or three months thereafter, as the Borrower may elect in the related notice
delivered pursuant to Sections 2.06(b) or 2.12; PROVIDED, HOWEVER, that (i) if
any Interest Period would end on a day which shall not be a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day,
and (ii) no Interest Period shall end later than the Termination Date.
"INVENTORY" shall mean all Raw Materials, Work in Process and Finished
Goods held by the Borrower or the Guarantors (as applicable) in the normal
course of business.
"INVENTORY RESERVES" means reserves against Inventory equal to the sum
of the following:
(a) a reserve for shrink, or discrepancies that arise pertaining to
inventory quantities on hand between the Borrower or the Guarantor's (as
applicable) perpetual inventory accounting system, and physical counts of
the inventory which will be equal to the results of the last physical count
with the variance expressed as a percentage, for Raw Materials and Finished
Goods, respectively, for the Borrower or the Guarantor (as applicable); and
14
(b) a reserve for excess or obsolete Inventory which is equal to the
Borrower or the Guarantor's (as applicable) financial statement reserve;
and
(c) with respect to any distribution center or warehouse or where any
Inventory subject to Liens arising by operation of law is located, a
reserve equal to three (3) months' rent at such distribution center or
warehouse, unless such Inventory is the subject of an acceptable collateral
access agreement or lien waiver satisfactory to the Agent; and
(d) a favorable variance reserve for variances in which standard
costs are in excess of actual costs; and
(e) a lower of cost or market reserve which includes all Inventory
that is sold, or valued by the Borrower or the Guarantors (as applicable)
or as deemed appropriate by the Collateral Agent in its sole discretion,
for less than the actual cost to produce; and
(f) any other reserve as deemed appropriate by the Agent in its sole
discretion, from time to time.
"INVENTORY VALUE" of any Inventory shall mean at the time of any
determination thereof the standard cost carried on the perpetual inventory
records of the Borrower and the Guarantors (as applicable) stated on a basis
consistent with the historical practices of the Borrower or the Guarantors (as
applicable), in Dollars, determined in accordance with the standard cost method
of accounting less (i) any markup on Inventory from an Affiliate and (ii) in the
event variances under the standard cost method (a) are capitalized, favorable
variances shall be deducted from Eligible Inventory, and unfavorable variances
shall not be added to Eligible Inventory, and (b) are expensed, a reserve shall
be determined as appropriate in order to adjust the standard cost of Eligible
Inventory to approximate actual cost.
"INVESTMENT GRADE" shall be defined as a rating established by a third
party rating agency, equivalent to a S&P BBB- or a Xxxxx'x Baa3 or better.
"INVESTMENTS" shall have the meaning given such term in Section 6.10.
"JPMORGAN CHASE" shall have the meaning set forth in the Introduction.
"LENDER AFFILIATE" shall mean, (a) with respect to any Lender, (i) an
Affiliate of such Lender or (ii) any entity (whether a corporation, partnership,
trust or otherwise) that is engaged in making, purchasing, holding or otherwise
investing in bank loans and similar extensions of credit in the ordinary course
of its business and is administered or managed by a Lender or an Affiliate of
such Lender and (b) with respect to any Lender that is a fund which invests in
bank loans and similar extensions of credit, any other fund that invests in bank
loans and similar extensions of credit and is managed by the same investment
advisor as such Lender or by an Affiliate of such investment advisor.
"LENDERS" shall have the meaning set forth in the Introduction.
15
"LETTER OF CREDIT" shall mean any irrevocable letter of credit issued
pursuant to Section 2.03, which letter of credit shall be (i) an import
documentary or a standby letter of credit, (ii) issued for purposes that are
reasonably acceptable to the Agent, (iii) denominated in Dollars and (iv)
otherwise in such form as may be reasonably approved from time to time by the
Agent and the applicable Fronting Bank.
"LETTER OF CREDIT ACCOUNT" shall mean the account established by the
Borrower under the sole and exclusive control of the Agent maintained at the
office of the Agent at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 designated as
the "Polymer Letter of Credit Account" that shall be used solely for the
purposes set forth in Sections 2.03(b) and 2.13.
"LETTER OF CREDIT FEES" shall mean the fees payable in respect of
Letters of Credit pursuant to Section 2.21.
"LETTER OF CREDIT OUTSTANDINGS" shall mean, at any time, the sum of
(i) the aggregate undrawn stated amount of all Letters of Credit then
outstanding plus (ii) all amounts theretofore drawn under Letters of Credit and
not then reimbursed.
"LIEN" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including any conditional
sale or other title retention agreement or any lease in the nature thereof).
"LOAN" shall have the meaning given such term in Section 2.01.
"LOAN DOCUMENTS" shall mean this Agreement, the Letters of Credit, the
Security and Pledge Agreement, and any other instrument or agreement executed
and delivered to the Agent or any Lender in connection herewith.
"LORETEX" shall mean Loretex Corporation, a subsidiary of the Borrower
referred to as Loretex and part of OPD.
"MATURITY DATE" shall mean May 30, 2003.
"MULTIEMPLOYER PLAN" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA, which is maintained or contributed to by (or to
which there is an obligation to contribute of) the Borrower or a Subsidiary of
the Borrower or an ERISA Affiliate, and each such plan for the five-year period
immediately following the latest date on which the Borrower, or a Subsidiary of
the Borrower or an ERISA Affiliate maintained, contributed to or had an
obligation to contribute to such plan.
"MULTIPLE EMPLOYER PLAN" shall mean a Single Employer Plan, which (i)
is maintained for employees of the Borrower or an ERISA Affiliate and at least
one person (as defined in Section 3(9) of ERISA) other than the Borrower and its
ERISA Affiliates or (ii) was so maintained and in respect of which the Borrower
or an ERISA Affiliate could reasonably be expected to have liability under
Section 4064 or 4069 of ERISA in the event such Plan has been or were to be
terminated.
16
"NWD" shall mean the operating division of the Borrower referred to as
the Nonwovens Division.
"OBLIGATIONS" shall mean (a) the due and punctual payment of principal
of and interest on the Loans and the reimbursement of all amounts drawn under
Letters of Credit, and (b) the due and punctual payment of the Fees and all
other present and future, fixed or contingent, monetary obligations of the
Borrower and the Guarantors to the Lenders and the Agent under the Loan
Documents.
"OPD" shall mean the operating division of the Borrower referred to as
the Oriented Polymers Division, including Fabrene, Loretex and Fabpro.
"ORDERS" shall mean the Interim Order and the Final Order of the
Bankruptcy Court referred to in Sections 4.01(b) and 4.02(d).
"OTHER TAXES" shall mean any and all present or future stamp or
documentary taxes or any other excise or property taxes, charges or similar
levies arising from any payment made hereunder or from the execution, delivery
or enforcement of, or otherwise with respect to, this Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor agency or entity performing substantially the same functions.
"PENSION PLAN" shall mean a defined benefit plan (as defined in
Section 414(j) of the Code and Section 3(35) of ERISA) which meets and is
subject to the requirements of Section 401(a) of the Code.
"PERMITTED INVESTMENTS" shall mean:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within twelve months from the date of acquisition thereof;
(b) without limiting the provisions of paragraph (d) below,
investments in commercial paper maturing within six months from the date of
acquisition thereof and having, at such date of acquisition, a rating of at
least "A-2" or the equivalent thereof from Standard & Poor's Ratings Services or
of at least "P-2" or the equivalent thereof from Xxxxx'x Investors Service,
Inc.;
(c) investments in certificates of deposit, banker's acceptances and
time deposits (including Eurodollar time deposits) maturing within six months
from the date of acquisition thereof issued or guaranteed by or placed with (i)
any domestic office of the Agent or the bank with whom the Borrower and the
Guarantors maintain their cash management system, provided, that if such bank is
not a Lender hereunder, such bank shall have entered into an agreement with the
Agent pursuant to which such bank shall have waived all rights of setoff and
confirmed that such bank does not have, nor shall it claim, a security interest
therein or (ii) any domestic office of any other commercial bank of recognized
standing organized under the laws
17
of the United States of America or any State thereof that has a combined capital
and surplus and undivided profits of not less than $250,000,000 and is the
principal banking Subsidiary of a bank holding company having a long-term
unsecured debt rating of at least "A-2" or the equivalent thereof from Standard
& Poor's Ratings Services or at least "P-2" or the equivalent thereof from
Xxxxx'x Investors Service, Inc.;
(d) investments in commercial paper maturing within six months from
the date of acquisition thereof and issued by (i) the holding company of the
Agent or (ii) the holding company of any other commercial bank of recognized
standing organized under the laws of the United States of America or any State
thereof that has (A) a combined capital and surplus in excess of $250,000,000
and (B) commercial paper rated at least "A-2" or the equivalent thereof from
Standard & Poor's Ratings Services or of at least "P-2" or the equivalent
thereof from Xxxxx'x Investors Service, Inc.;
(e) investments in repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clause (a)
above entered into with any office of a bank or trust company meeting the
qualifications specified in clause (c) above;
(f) investments in money market funds substantially all the assets
of which are comprised of securities of the types described in clauses (a)
through (e) above; and
(g) to the extent owned on the Filing Date, investments by the
Borrower or any Guarantor in the capital stock of any direct or indirect
Subsidiary.
"PERMITTED LIENS" shall mean (i) Liens imposed by law (other than
Environmental Liens and any Lien imposed under ERISA) for taxes, assessments or
charges of any Governmental Authority for claims not yet due or which are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; (ii) Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens (other than Environmental
Liens and any Lien imposed under ERISA) in existence on the Filing Date or
thereafter imposed by law and created in the ordinary course of business; (iii)
Liens (other than any Lien imposed under ERISA) incurred or deposits made in the
ordinary course of business (including, without limitation, surety bonds and
appeal bonds) in connection with workers' compensation, unemployment insurance
and other types of social security benefits or to secure the performance of
tenders, bids, leases, contracts (other than for the repayment of Indebtedness),
statutory obligations and other similar obligations or arising as a result of
progress payments under government contracts; (iv) easements (including, without
limitation, reciprocal easement agreements and utility agreements),
rights-of-way, covenants, consents, reservations, encroachments, variations and
zoning and other restrictions, charges or encumbrances (whether or not recorded)
and interest of ground lessors, which do not interfere materially with the
ordinary conduct of the business of the Borrower or any Guarantor, as the case
may be, and which do not materially detract from the value of the property to
which they attach or materially impair the use thereof to the Borrower or any
Guarantor, as the case may be; (v) purchase money Liens (including Capitalized
Leases) upon or in any property acquired or held in the ordinary course of
business to secure the purchase price of such property or to secure Indebtedness
permitted by Section 6.03(iv) solely for the purpose of financing the
acquisition of such
18
property; (vi) letters of credit or deposits in the ordinary course to secure
leases; and (vii) extensions, renewals or replacements of any Lien referred to
in paragraphs (i) through (vi) above, PROVIDED that the principal amount of the
obligation secured thereby is not increased and that any such extension, renewal
or replacement is limited to the property originally encumbered thereby.
"PERSON" shall mean any natural person, corporation, division of a
corporation, partnership, trust, joint venture, association, company, estate,
unincorporated organization or government or any agency or political subdivision
thereof.
"PLAN" shall mean a Single Employer Plan or a Multiemployer Plan.
"PREPAYMENT DATE" shall mean the date that is thirty (30) days after
the entry of the Interim Order by the Bankruptcy Court if the Final Order has
not been entered by the Bankruptcy Court prior to the expiration of such thirty
(30) day period.
"PRE-PETITION AGENT" shall mean JPMorgan Chase Bank as agent for the
Existing Lenders.
"PRE-PETITION PAYMENT" shall mean a payment (by way of adequate
protection or otherwise) of principal or interest or otherwise on account of any
pre-petition Indebtedness or trade payables or other pre-petition claims against
the Borrower or any Guarantor.
"RAW MATERIALS" shall mean materials used or consumed in the
production of goods to be sold by the Borrower or the Guarantors (as applicable)
in the ordinary course of business, such as polypropylene and polyethylene
resins, polyester and rayon fibers, additives, chemicals, wood pulp and tissue
paper.
"REGISTER" shall have the meaning set forth in Section 10.03(d).
"REORGANIZATION PLAN" shall mean a plan of reorganization in any of
the Cases.
"REQUIRED LENDERS" shall mean, at any time, Lenders holding Loans
representing in excess of 50% of the aggregate principal amount of such Loans
outstanding or, if no Loans are outstanding, Lenders having Commitments
representing in excess of 50% of the Total Commitment.
"RESERVE FOR CUSTOMERS WITH EXTENDED TERMS" shall mean 35% of all
Fabpro Account balances with extended or special terms, as determined by the
Agent.
"SECURITY AND PLEDGE AGREEMENT" shall have the meaning set forth in
Section 4.01(c).
"SINGLE EMPLOYER PLAN" shall mean a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (i) is maintained for employees of the
Borrower or an ERISA Affiliate or (ii) was so maintained and in respect of which
the Borrower could reasonably be expected to have liability under Title IV of
ERISA in the event such Plan has been or were to be terminated.
19
"STATUTORY RESERVES" shall mean on any date the percentage (expressed
as a decimal) established by the Board and any other banking authority which is
(i) for purposes of the definition of Base CD Rate, the then stated maximum rate
of all reserves (including, but not limited to, any emergency, supplemental or
other marginal reserve requirement) for a member bank of the Federal Reserve
System in New York City, for new three month negotiable nonpersonal time
deposits in dollars of $100,000 or more or (ii) for purposes of the definition
of Adjusted LIBOR Rate, the then stated maximum rate for all reserves (including
but not limited to any emergency, supplemental or other marginal reserve
requirements) applicable to any member bank of the Federal Reserve System in
respect of Eurocurrency Liabilities (or any successor category of liabilities
under Regulation D issued by the Board, as in effect from time to time). Such
reserve percentages shall include, without limitation, those imposed pursuant to
said Regulation. The Statutory Reserves shall be adjusted automatically on and
as of the effective date of any change in such percentage.
"SUBSIDIARY" shall mean, with respect to any Person (herein referred
to as the "PARENT"), any corporation, association or other business entity
(whether now existing or hereafter organized) of which at least a majority of
the securities or other ownership or membership interests having ordinary voting
power for the election of directors is, at the time as of which any
determination is being made, owned or controlled by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
"SUPER-MAJORITY LENDERS" shall have the meaning given such term in
Section 10.10(b).
"SUPERPRIORITY CLAIM" shall mean a claim against the Borrower and any
Guarantor in any of the Cases which is an administrative expense claim having
priority over any or all administrative expenses of the kind specified in
Sections 503(b) or 507(b) of the Bankruptcy Code.
"TAXES" shall mean any and all present or future taxes, levies,
imposts, duties, deductions, charges or withholdings imposed by any Governmental
Authority.
"TERMINATION DATE" shall mean the earliest to occur of (i) the
Prepayment Date, (ii) the Maturity Date, (iii) the Consummation Date and (iv)
the acceleration of the Loans and the termination of the Total Commitment in
accordance with the terms hereof.
"TERMINATION EVENT" shall mean (i) a "reportable event", as such term
is described in Section 4043(c) of ERISA (other than a "reportable event" as to
which the 30-day notice is waived under subsection .22, .23, .25, .27 or .28 of
PBGC Regulation Section 4043) or an event described in Section 4068 of ERISA and
excluding events which would not be reasonably likely (as reasonably determined
by the Agent) to have a material adverse effect on the financial condition,
operations, business, properties or assets of the Borrower and the Guarantors
taken as a whole, or (ii) the withdrawal of the Borrower or any ERISA Affiliate
from a Multiple Employer Plan during a plan year in which it was a "substantial
employer," as such term is defined in Section 4001(a)(2) of ERISA, the
incurrence of liability by the Borrower or any ERISA Affiliate under Section
4064 of ERISA upon the termination of a Multiple Employer Plan, the imposition
of Withdrawal Liability, or (iii) providing notice of intent to terminate a
20
Plan pursuant to Section 4041(c) of ERISA or the treatment of a Plan amendment
as a termination under Section 4041 of ERISA, if such amendment requires the
provision of security, or (iv) the institution of proceedings to terminate a
Plan by the PBGC under Section 4042 of ERISA, or (v) any other event or
condition (other than the commencement of the Cases and the failure to have made
any contribution accrued as of the Filing Date but not paid) which would
reasonably be expected to constitute grounds under Section 4042 of ERISA for the
termination of, or the appointment of a trustee to administer, any Plan, or the
imposition of any liability under Title IV of ERISA (other than for the payment
of premiums to the PBGC in the ordinary course).
"TOTAL COMMITMENT" shall mean, at any time, the sum of the Commitments
at such time.
"TYPE" when used in respect of any Loan or Borrowing shall refer to
the Rate of interest by reference to which interest on such Loan or on the Loans
comprising such Borrowing is determined. For purposes hereof, "Rate" shall mean
the Adjusted LIBOR Rate and the Alternate Base Rate.
"UNUSED TOTAL COMMITMENT" shall mean, at any time, (i) the Total
Commitment less (ii) the sum of (x) the aggregate outstanding principal amount
of all Loans and (y) the aggregate Letter of Credit Outstandings.
"WORK IN PROCESS" shall mean incomplete or semi-finished goods which
require additional processing and are not Raw Materials or Finished Goods, to be
sold by the Borrower or the Guarantors (as applicable) in the ordinary course of
business.
"WITHDRAWAL LIABILITY" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
SECTION 1.02 TERMS GENERALLY. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. All references herein to Sections,
Exhibits and Schedules shall be deemed references to Sections of, and Exhibits
and Schedules to, this Agreement unless the context shall otherwise require.
Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; PROVIDED, HOWEVER, that for purposes of determining compliance
with any covenant set forth in Section 6, such terms shall be construed in
accordance with GAAP as in effect on the date of this Agreement applied on a
basis consistent with the application used in the Borrower's audited financial
statements referred to in Section 3.04.
SECTION 2. AMOUNT AND TERMS OF CREDIT
SECTION 2.01 COMMITMENT OF THE LENDERS.
(a) Each Lender severally and not jointly with the other Lenders
agrees, upon the terms and subject to the conditions herein set forth
(including, without limitation, the provisions of Section 2.28), to make
revolving credit loans (each a "LOAN" and collectively, the
21
"LOANS") to the Borrower at any time and from time to time during the period
commencing on the date hereof and ending on the Termination Date in an aggregate
principal amount not to exceed, when added to such Lender's Commitment
Percentage of the then aggregate Letter of Credit Outstandings, the Commitment
of such Lender, which Loans may be repaid and reborrowed in accordance with the
provisions of this Agreement. At no time shall the sum of the then outstanding
aggregate principal amount of the Loans PLUS the then aggregate Letter of Credit
Outstandings exceed the lesser of (i) the Total Commitment of $125,000,000, as
the same may be reduced from time to time pursuant to Sections 2.10 and 2.13 and
(ii) the Borrowing Base.
(b) Each Borrowing shall be made by the Lenders PRO RATA in
accordance with their respective Commitments; PROVIDED, HOWEVER, that the
failure of any Lender to make any Loan shall not in itself relieve the other
Lenders of their obligations to lend.
SECTION 2.02 BORROWING BASE. Notwithstanding any other provision of this
Agreement to the contrary, the aggregate principal amount of all outstanding
Loans PLUS the then aggregate Letter of Credit Outstandings (in excess of the
amount of cash then held in the Letter of Credit Account pursuant to Section
2.03(b)) shall not at any time exceed the Borrowing Base and no Loan shall be
made or Letter of Credit issued in violation of the foregoing.
SECTION 2.03 LETTERS OF CREDIT.
(a) Upon the terms and subject to the conditions herein set forth,
the Borrower may request a Fronting Bank, at any time and from time to time
after the date hereof and prior to the Termination Date, to issue, and, subject
to the terms and conditions contained herein, such Fronting Bank shall issue,
for the account of the Borrower or a Guarantor one or more Letters of Credit,
provided that no Letter of Credit shall be issued if after giving effect to such
issuance (i) the aggregate Letter of Credit Outstandings shall exceed
$20,000,000 or (ii) the aggregate Letter of Credit Outstandings, when added to
the aggregate outstanding principal amount of the Loans, would exceed the Total
Commitment and, PROVIDED FURTHER that no Letter of Credit shall be issued if the
Fronting Bank shall have received notice from the Agent or the Required Lenders
that the conditions to such issuance have not been met.
(b) No Letter of Credit shall expire later than the Maturity Date,
PROVIDED that if any Letter of Credit shall be outstanding on the Termination
Date, the Borrower shall, at or prior to the Termination Date, except as the
Agent may otherwise agree in writing, (i) cause all Letters of Credit which
expire after the Termination Date to be returned to the Fronting Bank undrawn
and marked "cancelled" or (ii) if the Borrower is unable to do so in whole or in
part, either (x) provide a "back-to-back" letter of credit to one or more
Fronting Banks in a form satisfactory to such Fronting Bank and the Agent (in
their sole discretion), issued by a bank satisfactory to such Fronting Bank and
the Agent (in their sole discretion), and in an amount equal to 105% of the then
undrawn stated amount of all outstanding Letters of Credit issued by such
Fronting Banks (LESS the amount, if any, then on deposit in the Letter of Credit
Account) and/or (y) deposit cash in the Letter of Credit Account in an amount
equal to 105% of the then undrawn stated amount of all Letter of Credit
Outstandings (LESS the amount, if any, then on deposit in the Letter of Credit
Account) as collateral security for the Borrower's reimbursement
22
obligations in connection therewith, such cash to be promptly remitted to the
Borrower upon the expiration, cancellation or other termination or satisfaction
of such reimbursement obligations.
(c) The Borrower shall pay to each Fronting Bank, in addition to such
other fees and charges as are specifically provided for in Section 2.21 hereof,
such fees and charges in connection with the issuance and processing of the
Letters of Credit issued by such Fronting Bank as are customarily imposed by
such Fronting Bank from time to time in connection with letter of credit
transactions.
(d) Drafts drawn under each Letter of Credit shall be reimbursed by
the Borrower in Dollars not later than the first Business Day following the date
of draw and shall bear interest from the date of draw until the first Business
Day following the date of draw at a rate per annum equal to the Alternate Base
Rate PLUS 3.5% and thereafter on the unreimbursed portion until reimbursed in
full at a rate per annum equal to the Alternate Base Rate PLUS 5.5% (computed on
the basis of the actual number of days elapsed over a year of 365 days or 366
days in a leap year). The Borrower shall effect such reimbursement (x) if such
draw occurs prior to the Termination Date, in cash or through a Borrowing
without the satisfaction of the conditions precedent set forth in Section 4.02
or (y) if such draw occurs on or after the Termination Date, in cash. Each
Lender agrees to make the Loans described in clause (x) of the preceding
sentence notwithstanding a failure to satisfy the applicable lending conditions
thereto or the provisions of Sections 2.02 or 2.28.
(e) Immediately upon the issuance of any Letter of Credit by any
Fronting Bank, such Fronting Bank shall be deemed to have sold to each Lender
other than such Fronting Bank and each such other Lender shall be deemed
unconditionally and irrevocably to have purchased from such Fronting Bank,
without recourse or warranty, an undivided interest and participation, to the
extent of such Lender's Commitment Percentage, in such Letter of Credit, each
drawing thereunder and the obligations of the Borrower and the Guarantors under
this Agreement with respect thereto. Upon any change in the Commitments pursuant
to Section 10.03, it is hereby agreed that with respect to all Letter of Credit
Outstandings, there shall be an automatic adjustment to the participations
hereby created to reflect the new Commitment Percentages of the assigning and
assignee Lenders. Any action taken or omitted by a Fronting Bank under or in
connection with a Letter of Credit, if taken or omitted in the absence of gross
negligence or willful misconduct, shall not create for such Fronting Bank any
resulting liability to any other Lender.
(f) In the event that a Fronting Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to such Fronting Bank pursuant to this Section, the Fronting Bank shall promptly
notify the Agent, which shall promptly notify each Lender of such failure, and
each Lender shall promptly and unconditionally pay to the Agent for the account
of the Fronting Bank the amount of such Lender's Commitment Percentage of such
unreimbursed payment in Dollars and in same day funds. If the Fronting Bank so
notifies the Agent, and the Agent so notifies the Lenders prior to 11:00 a.m.
(New York City time) on any Business Day, such Lenders shall make available to
the Fronting Bank such Lender's Commitment Percentage of the amount of such
payment on such Business Day in same day funds. If and to the extent such Lender
shall not have so made its Commitment Percentage of the amount of such payment
available to the Fronting Bank, such Lender agrees to pay to such
23
Fronting Bank, forthwith on demand such amount, together with interest thereon,
for each day from such date until the date such amount is paid to the Agent for
the account of such Fronting Bank at the Federal Funds Effective Rate. The
failure of any Lender to make available to the Fronting Bank its Commitment
Percentage of any payment under any Letter of Credit shall not relieve any other
Lender of its obligation hereunder to make available to the Fronting Bank its
Commitment Percentage of any payment under any Letter of Credit on the date
required, as specified above, but no Lender shall be responsible for the failure
of any other Lender to make available to such Fronting Bank such other Lender's
Commitment Percentage of any such payment. Whenever a Fronting Bank receives a
payment of a reimbursement obligation as to which it has received any payments
from the Lenders pursuant to this paragraph, such Fronting Bank shall pay to
each Lender which has paid its Commitment Percentage thereof, in Dollars and in
same day funds, an amount equal to such Lender's Commitment Percentage thereof.
SECTION 2.04 ISSUANCE. Whenever the Borrower desires a Fronting Bank to
issue a Letter of Credit, it shall give to such Fronting Bank and the Agent
prior written (including telegraphic, telex, facsimile or cable communication)
notice reasonably in advance of the requested date of issuance specifying the
date on which the proposed Letter of Credit is to be issued (which shall be a
Business Day), the stated amount of the Letter of Credit so requested, the
expiration date of such Letter of Credit and the name and address of the
beneficiary thereof.
SECTION 2.05 NATURE OF LETTER OF CREDIT OBLIGATIONS ABSOLUTE. The
obligations of the Borrower to reimburse the Lenders for drawings made under any
Letter of Credit shall be unconditional and irrevocable and shall be paid
strictly in accordance with the terms of this Agreement under all circumstances,
including, without limitation (it being understood that any such payment by the
Borrower shall be without prejudice to, and shall not constitute a waiver of,
any rights the Borrower might have or might acquire as a result of the payment
by the Fronting Bank of any draft or the reimbursement by the Borrower thereof):
(i) any lack of validity or enforceability of any Letter of Credit; (ii) the
existence of any claim, setoff, defense or other right which the Borrower or any
Guarantor may have at any time against a beneficiary of any Letter of Credit or
against any of the Lenders, whether in connection with this Agreement, the
transactions contemplated herein or any unrelated transaction; (iii) any draft,
demand, certificate or other document presented under any Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect; (iv) payment by a
Fronting Bank of any Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the terms of such
Letter of Credit; (v) any other circumstance or happening whatsoever, which is
similar to any of the foregoing; or (vi) the fact that any Event of Default
shall have occurred and be continuing.
SECTION 2.06 MAKING OF LOANS.
(a) Except as contemplated by Section 2.11, Loans shall be either ABR
Loans or Eurodollar Loans as the Borrower may request subject to and in
accordance with this Section, provided that all Loans made pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, be Loans of the
same Type. Each Lender may fulfill its Commitment with respect to any Eurodollar
Loan or ABR Loan by causing any lending office of such Lender to make such Loan;
provided that any such use of a lending office shall not affect the obligation
of the Borrower to repay such Loan in accordance with the terms of this
Agreement. Each Lender
24
shall, subject to its overall policy considerations, use reasonable efforts (but
shall not be obligated) to select a lending office which will not result in the
payment of increased costs by the Borrower pursuant to Section 2.15. Subject to
the other provisions of this Section and the provisions of Section 2.12,
Borrowings of Loans of more than one Type may be incurred at the same time,
provided that no more than seven (7) Borrowings of Eurodollar Loans may be
outstanding at any time.
(b) The Borrower shall give the Agent prior notice of each Borrowing
hereunder of at least three Business Days for Eurodollar Loans and one Business
Day for ABR Loans (subject, in the case of ABR Loans, to the last sentence of
this Section); such notice shall be irrevocable and shall specify the amount of
the proposed Borrowing (which shall not be less than $2,500,000 (and integral
multiples of $1,000,000) in the case of Eurodollar Loans and $1,000,000 (and
integral multiples of $100,000) in the case of ABR Loans) and the date thereof
(which shall be a Business Day) and shall contain disbursement instructions.
Such notice, to be effective, must be received by the Agent not later than 1:00
p.m., New York City time, on the third Business Day in the case of Eurodollar
Loans and 12:00 noon, New York City time on the first Business Day in the case
of ABR Loans, preceding the date on which such Borrowing is to be made. Such
notice shall specify whether the Borrowing then being requested is to be a
Borrowing of ABR Loans or Eurodollar Loans. If no election is made as to the
Type of Loan, such notice shall be deemed a request for Borrowing of ABR Loans.
The Agent shall promptly notify each Lender of its proportionate share of such
Borrowing, the date of such Borrowing, the Type of Borrowing or Loans being
requested and the Interest Period or Interest Periods applicable thereto, as
appropriate. On the borrowing date specified in such notice, each Lender shall
make its share of the Borrowing available at the office of the Agent at 000 Xxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, no later than 12:00 noon, New York City time,
in immediately available funds. Upon receipt of the funds made available by the
Lenders to fund any borrowing hereunder, the Agent shall disburse such funds in
the manner specified in the notice of borrowing delivered by the Borrower and
shall use reasonable efforts to make the funds so received from the Lenders
available to the Borrower no later than 2:00 p.m. New York City time.
SECTION 2.07 REPAYMENT OF LOANS; EVIDENCE OF DEBT.
(a) The Borrower hereby unconditionally promises to pay to the Agent
for the account of each Lender the then unpaid principal amount of each Loan on
the Termination Date.
(b) Each Lender shall maintain in accordance with its usual practice
an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of
principal and interest payable and paid to such Lender from time to time
hereunder.
(c) The Agent shall maintain accounts in which it shall record (i)
the amount of each Loan made hereunder, the Type thereof and the 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) the amount of any sum received by the Agent hereunder for the account of
the Lenders and each Lender's share thereof.
25
(d) The entries made in the accounts maintained pursuant to paragraph
(b) or (c) of this Section shall be PRIMA FACIE evidence of the existence and
amounts of the obligations recorded therein; PROVIDED that the failure of any
Lender or the Agent to maintain such accounts or any error therein shall not in
any manner affect the obligation of the Borrower to repay the Loans in
accordance with the terms of this Agreement.
(e) Any Lender may request that Loans made by it be evidenced by a
promissory note. In such event, the Borrower shall execute and deliver to such
Lender a promissory note payable to the order of such Lender (or, if requested
by such Lender, to such Lender and its registered assigns) in a form furnished
by the Agent and reasonably acceptable to the Borrower. Thereafter, the Loans
evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 10.03) be represented by one or
more promissory notes in such form payable to the order of the payee named
therein (or, if such promissory note is a registered note, to such payee and its
registered assigns).
SECTION 2.08 INTEREST ON LOANS.
(a) Subject to the provisions of Section 2.09, each ABR Loan shall
bear interest (computed on the basis of the actual number of days elapsed over a
year of 360 days or, when the Alternate Base Rate is based on the Prime Rate, a
year with 365 days or 366 days in a leap year) at a rate per annum equal to the
Alternate Base Rate plus 2.5%.
(b) Subject to the provisions of Section 2.09, each Eurodollar Loan
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 360 days) at a rate per annum equal, during each Interest Period
applicable thereto, to the Adjusted LIBOR Rate for such Interest Period in
effect for such Borrowing plus 3.5%.
(c) Accrued interest on all Loans shall be payable monthly in arrears
on each Interest Payment Date applicable thereto, on the Termination Date, after
the Termination Date on demand and (with respect to Eurodollar Loans) upon any
repayment or prepayment thereof (on the amount prepaid).
SECTION 2.09 DEFAULT INTEREST. If the Borrower or any Guarantor, as the
case may be, shall default in the payment of the principal of or interest on any
Loan or in the payment of any other amount becoming due hereunder (including,
without limitation, the reimbursement pursuant to Section 2.03(d) of any draft
drawn under a Letter of Credit), whether at stated maturity, by acceleration or
otherwise, the Borrower or such Guarantor, as the case may be, shall on demand
from time to time pay interest, to the extent permitted by law, on such
defaulted amount up to (but not including) the date of actual payment (after as
well as before judgment) at a rate per annum (computed on the basis of the
actual number of days elapsed over a year of 360 days or when the Alternate Base
Rate is applicable and is based on the Prime Rate, a year with 365 days or 366
days in a leap year) equal to (x) in the case of Borrowings consisting of
Eurodollar Loans, the Adjusted LIBOR Rate in effect for such Borrowing PLUS 5.5%
and (y) in the case of all other amounts, the Alternate Base Rate PLUS 4.5%.
SECTION 2.10 OPTIONAL TERMINATION OR REDUCTION OF COMMITMENT. Upon at
least two Business Days' prior written notice to the Agent, the Borrower may at
any time in whole
26
permanently terminate, or from time to time in part permanently reduce, the
Unused Total Commitment. Each such reduction of the Commitments shall be in the
principal amount of $1,000,000 or any integral multiple thereof. Simultaneously
with each reduction or termination of the Commitment, the Borrower shall pay to
the Agent for the account of each Lender the Commitment Fee accrued and unpaid
on the amount of the Commitment of such Lender so terminated or reduced through
the date thereof. Any reduction of the Total Commitment pursuant to this Section
shall be applied PRO RATA to reduce the Commitment of each Lender.
SECTION 2.11 ALTERNATE RATE OF INTEREST. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Loan, the Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower absent manifest
error) that reasonable means do not exist for ascertaining the applicable
Adjusted LIBOR Rate, the Agent shall, as soon as practicable thereafter, give
written, facsimile or telegraphic notice of such determination to the Borrower
and the Lenders, and any request by the Borrower for a Borrowing of Eurodollar
Loans (including pursuant to a refinancing with Eurodollar Loans) pursuant to
Section 2.06 or 2.12 shall be deemed a request for a Borrowing of ABR Loans.
After such notice shall have been given and until the circumstances giving rise
to such notice no longer exist, each request for a Borrowing of Eurodollar Loans
shall be deemed to be a request for a Borrowing of ABR Loans.
SECTION 2.12 REFINANCING OF LOANS. The Borrower shall have the right, at
any time, on three Business Days' prior irrevocable notice to the Agent (which
notice, to be effective, must be received by the Agent not later than 1:00 p.m.,
New York City time, on the third Business Day preceding the date of any
refinancing), (x) to refinance (without the satisfaction of the conditions set
forth in Section 4 as a condition to such refinancing, except as set forth in
subsection (a) below) any outstanding Borrowing or Borrowings of Loans of one
Type (or a portion thereof) with a Borrowing of Loans of the other Type or (y)
to continue an outstanding Borrowing of Eurodollar Loans for an additional
Interest Period, subject to the following:
(a) as a condition to the refinancing of ABR Loans with Eurodollar
Loans and to the continuation of Eurodollar Loans for an additional Interest
Period, no Event of Default shall have occurred and be continuing at the time of
such refinancing;
(b) if less than a full Borrowing of Loans shall be refinanced, such
refinancing shall be made PRO RATA among the Lenders in accordance with the
respective principal amounts of the Loans comprising such Borrowing held by the
Lenders immediately prior to such refinancing;
(c) the aggregate principal amount of Loans being refinanced shall be
at least $2,500,000, PROVIDED that no partial refinancing of a Borrowing of
Eurodollar Loans shall result in the Eurodollar Loans remaining outstanding
pursuant to such Borrowing being less than $2,500,000 in aggregate principal
amount;
(d) each Lender shall effect each refinancing by applying the
proceeds of its new Eurodollar Loan or ABR Loan, as the case may be, to its Loan
being refinanced;
27
(e) the Interest Period with respect to a Borrowing of Eurodollar
Loans effected by a refinancing or in respect to the Borrowing of Eurodollar
Loans being continued as Eurodollar Loans shall commence on the date of
refinancing or the expiration of the current Interest Period applicable to such
continuing Borrowing, as the case may be;
(f) a Borrowing of Eurodollar Loans may be refinanced only on the
last day of an Interest Period applicable thereto; and
(g) each request for a refinancing with a Borrowing of Eurodollar
Loans which fails to state an applicable Interest Period shall be deemed to be a
request for an Interest Period of one month.
In the event that the Borrower shall not give notice to refinance any Borrowing
of Eurodollar Loans, or to continue such Borrowing as Eurodollar Loans, or shall
not be entitled to refinance or continue such Borrowing as Eurodollar Loans, in
each case as provided above, such Borrowing shall automatically be refinanced
with a Borrowing of ABR Loans at the expiration of the then-current Interest
Period. The Agent shall, after it receives notice from the Borrower, promptly
give each Lender notice of any refinancing, in whole or part, of any Loan made
by such Lender.
SECTION 2.13 MANDATORY PREPAYMENT; COMMITMENT TERMINATION; CASH
COLLATERAL.
(a) If at any time the aggregate principal amount of the outstanding
Loans PLUS the Letter of Credit Outstandings exceeds the lesser of (x) the Total
Commitment and (y) the Borrowing Base, the Borrower will within three Business
Days (i) prepay the Loans in an amount necessary to cause the aggregate
principal amount of the outstanding Loans PLUS the aggregate Letter of Credit
Outstandings to be equal to or less than the Total Commitment and/or the
Borrowing Base, as the case may be, and (ii) if, after giving effect to the
prepayment in full of the Loans, the undrawn amount of outstanding Letter of
Credit Outstandings in excess of the amount of cash held in the Letter of Credit
Account exceeds the Total Commitment and/or the Borrowing Base, as the case may
be, deposit into the Letter of Credit Account an amount equal to 105% of the
amount by which the aggregate Letter of Credit Outstandings in excess of the
amount of cash held in the Letter of Credit Account so exceeds the Total
Commitment or Borrowing Base, as the case may be.
(b) Upon the Termination Date, the Total Commitment shall be
terminated in full and the Borrower shall repay the Loans in full (plus any
accrued but unpaid interest and fees thereon) and, except as the Agent may
otherwise agree in writing, if any Letter of Credit remains outstanding, deposit
into the Letter of Credit Account an amount equal to 105% of the amount by which
the Letter of Credit Outstandings exceeds the amount of cash held in the Letter
of Credit Account, such cash to be remitted to the Borrower upon the expiration,
cancellation, satisfaction or other termination of such reimbursement
obligations, or otherwise comply with Section 2.03(b).
SECTION 2.14 OPTIONAL PREPAYMENT OF LOANS; REIMBURSEMENT OF LENDERS.
(a) The Borrower shall have the right at any time and from time to
time to prepay any Loans, in whole or in part, (x) with respect to Eurodollar
Loans, upon at least three
28
Business Days' prior written or facsimile notice to the Agent and (y) with
respect to ABR Loans on the same Business Day if written or facsimile notice is
received by the Agent prior to 12:00 noon, New York City time, and thereafter
upon at least one Business Day's prior written or facsimile notice to the Agent;
PROVIDED, HOWEVER, that (i) each such partial prepayment shall be in multiples
of $1,000,000, (ii) no prepayment of Eurodollar Loans shall be permitted
pursuant to this Section 2.14(a) other than on the last day of an Interest
Period applicable thereto unless such prepayment is accompanied by the payment
of the amounts described in clause (i) of the first sentence of Section 2.14(b),
and (iii) no partial prepayment of a Borrowing of Eurodollar Loans shall result
in the aggregate principal amount of the Eurodollar Loans remaining outstanding
pursuant to such Borrowing being less than $1,000,000. Each notice of prepayment
shall specify the prepayment date, the principal amount of the Loans to be
prepaid and in the case of Eurodollar Loans, the Borrowing or Borrowings
pursuant to which made, shall be irrevocable and shall commit the Borrower to
prepay such Loan by the amount and on the date stated therein. The Agent shall,
promptly after receiving notice from the Borrower hereunder, notify each Lender
of the principal amount of the Loans held by such Lender which are to be
prepaid, the prepayment date and the manner of application of the prepayment.
(b) The Borrower shall reimburse each Lender on demand for any loss
incurred or to be incurred by it in the reemployment of the funds released (i)
resulting from any prepayment (for any reason whatsoever, including, without
limitation, refinancing with ABR Loans) of any Eurodollar Loan required or
permitted under this Agreement, if such Loan is prepaid other than on the last
day of the Interest Period for such Loan (including, without limitation, any
such prepayment in connection with the syndication of the credit facility
evidenced by this Agreement) or (ii) in the event that after the Borrower
delivers a notice of borrowing under Section 2.06 in respect of Eurodollar
Loans, such Loans are not made on the first day of the Interest Period specified
in such notice of borrowing for any reason other than a breach by such Lender of
its obligations hereunder. Such loss shall be the amount as reasonably
determined by such Lender as the excess, if any, of (A) the amount of interest
which would have accrued to such Lender on the amount so paid or not borrowed at
a rate of interest equal to the Adjusted LIBOR Rate for such Loan, for the
period from the date of such payment or failure to borrow to the last day (x) in
the case of a payment or refinancing with ABR Loans other than on the last day
of the Interest Period for such Loan, of the then current Interest Period for
such Loan, or (y) in the case of such failure to borrow, of the Interest Period
for such Loan which would have commenced on the date of such failure to borrow,
over (B) the amount of interest 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 London interbank market. Each Lender shall deliver to the Borrower
from time to time one or more certificates setting forth the amount of such loss
as determined by such Lender.
(c) In the event the Borrower fails to prepay any Loan on the date
specified in any prepayment notice delivered pursuant to Section 2.14(a), the
Borrower on demand by any Lender shall pay to the Agent for the account of such
Lender any amounts required to compensate such Lender for any loss incurred by
such Lender as a result of such failure to prepay, including, without
limitation, any loss, cost or expenses incurred by reason of the acquisition of
deposits or other funds by such Lender to fulfill deposit obligations incurred
in anticipation of such prepayment, but without duplication of any amounts paid
under Section
29
2.14(b). Each Lender shall deliver to the Borrower from time to time one or more
certificates setting forth the amount of such loss as determined by such Lender.
(d) Any partial prepayment of the Loans by the Borrower pursuant to
Sections 2.13 or 2.14 shall be applied as specified by the Borrower or, in the
absence of such specification, as determined by the Agent, PROVIDED that in the
latter case no Eurodollar Loans shall be prepaid pursuant to Section 2.13 to the
extent that such Loan has an Interest Period ending after the required date of
prepayment unless and until all outstanding ABR Loans and Eurodollar Loans with
Interest Periods ending on such date have been repaid in full.
SECTION 2.15 RESERVE REQUIREMENTS; CHANGE IN CIRCUMSTANCES.
(a) Notwithstanding any other provision herein, if after the date of
this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any Lender of
the principal of or interest on any Eurodollar Loan made by such Lender or any
fees or other amounts payable hereunder (other than changes in respect of Taxes,
Other Taxes and taxes imposed on, or measured by, the net income or overall
gross receipts or franchise taxes of such Lender by the national jurisdiction in
which such Lender has its principal office or in which the applicable lending
office for such Eurodollar Loan is located or by any political subdivision or
taxing authority therein, or by any other jurisdiction or by any political
subdivision or taxing authority therein other than a jurisdiction in which such
Lender would not be subject to tax but for the execution and performance of this
Agreement), or shall impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of or credit extended by such Lender (except any such reserve
requirement which is reflected in the Adjusted LIBOR Rate) or shall impose on
such Lender or the London interbank market any other condition affecting this
Agreement or the Eurodollar Loans made by such Lender, and the result of any of
the foregoing shall be to increase the cost to such Lender of making or
maintaining any Eurodollar Loan or to reduce the amount of any sum received or
receivable by such Lender hereunder (whether of principal, interest or
otherwise) by an amount deemed by such Lender to be material, then the Borrower
will pay to such Lender in accordance with paragraph (c) below such additional
amount or amounts as will compensate such Lender for such additional costs
incurred or reduction suffered.
(b) If any Lender shall have determined that the adoption or
effectiveness after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any governmental
authority, central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or any lending office of
such Lender) or any Lender's holding company with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital or on the capital of such
Lender's holding company, if any, as a consequence of this Agreement, the Loans
made by such Lender pursuant hereto, such Lender's Commitment hereunder or the
issuance of, or participation in, any Letter of Credit by such Lender to a level
below that which such Lender or such Lender's holding company could have
achieved but for
30
such adoption, change or compliance (taking into account Lender's policies and
the policies of such Lender's holding company with respect to capital adequacy)
by an amount deemed by such Lender to be material (except to the extent that
such amount is reflected in the Adjusted LIBOR Rate), then from time to time the
Borrower shall pay to such Lender such additional amount or amounts as will
compensate such Lender or such Lender's holding company for any such reduction
suffered.
(c) A certificate of each Lender setting forth such amount or amounts
as shall be necessary to compensate such Lender or its holding company as
specified in paragraph (a) or (b) above, as the case may be, shall be delivered
to the Borrower and shall be conclusive absent manifest error. The Borrower
shall pay each Lender the amount shown as due on any such certificate delivered
to it within 10 days after its receipt of the same. Any Lender receiving any
such payment shall promptly make a refund thereof to the Borrower if the law,
regulation, guideline or change in circumstances giving rise to such payment is
subsequently deemed or held to be invalid or inapplicable.
(d) Failure on the part of any Lender to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
return on capital with respect to any period shall not constitute a waiver of
such Lender's right to demand compensation with respect to such period or any
other period, PROVIDED that the Borrower shall not be required to compensate a
Lender pursuant to this Section for any increased costs or reductions incurred
more than 270 days prior to the date that such Lender notifies the Borrower of
the circumstance giving rise to such increased costs or reductions and of such
Lender's intention to claim compensation therefor. The protection of this
Section shall be available to each Lender regardless of any possible contention
of the invalidity or inapplicability of the law, rule, regulation, guideline or
other change or condition which shall have occurred or been imposed.
SECTION 2.16 CHANGE IN LEGALITY.
(a) Notwithstanding anything to the contrary contained elsewhere in
this Agreement, if (x) any change after the date of this Agreement in any law or
regulation or in the interpretation thereof by any Governmental Authority
charged with the administration thereof shall make it unlawful for a Lender to
make or maintain a Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to a Eurodollar Loan or (y) at any time any
Lender determines that the making or continuance of any of its Eurodollar Loans
has become impracticable as a result of a contingency occurring after the date
hereof which adversely affects the London interbank market or the position of
such Lender in such market, then, by written notice to the Borrower, such Lender
may (i) declare that Eurodollar Loans will not thereafter be made by such Lender
hereunder, whereupon any request by the Borrower for a Eurodollar Borrowing
shall, as to such Lender only, be deemed a request for an ABR Loan unless such
declaration shall be subsequently withdrawn; and (ii) require that all
outstanding Eurodollar Loans made by it be converted to ABR Loans, in which
event all such Eurodollar Loans shall be automatically converted to ABR Loans as
of the effective date of such notice as provided in paragraph (b) below. In the
event any Lender shall exercise its rights under clause (i) or (ii) of this
paragraph (a), all payments and prepayments of principal which would otherwise
have been applied to repay the Eurodollar Loans that would have been made by
such Lender or the
31
converted Eurodollar Loans of such Lender shall instead be applied to repay the
ABR Loans made by such Lender in lieu of, or resulting from the conversion of,
such Eurodollar Loans.
(b) For purposes of this Section 2.16, a notice to the Borrower by
any Lender pursuant to paragraph (a) above shall be effective, if lawful, and if
any Eurodollar Loans shall then be outstanding, on the last day of the
then-current Interest Period, otherwise, such notice shall be effective on the
date of receipt by the Borrower.
SECTION 2.17 PRO RATA TREATMENT, ETC. All payments and repayments of
principal and interest in respect of the Loans (except as provided in Sections
2.15 and 2.16) shall be made PRO RATA among the Lenders in accordance with the
then outstanding principal amount of the Loans and/or participations in Letter
of Credit Outstandings hereunder and all payments of Commitment Fees and Letter
of Credit Fees (other than those payable to a Fronting Bank) shall be made PRO
RATA among the Lenders in accordance with their Commitments. All payments by the
Borrower hereunder shall be (i) net of any tax applicable to the Borrower or
Guarantor and (ii) made in Dollars in immediately available funds at the office
of the Agent by 12:00 noon, New York City time, on the date on which such
payment shall be due. Interest in respect of any Loan hereunder shall accrue
from and including the date of such Loan to but excluding the date on which such
Loan is paid in full or converted to a Loan of a different Type.
SECTION 2.18 TAXES.
(a) Any and all payments by or on account of any obligation of the
Borrower hereunder shall be made free and clear of, and without deduction for,
any Indemnified Taxes or Other Taxes; PROVIDED that if the Borrower shall be
required to deduct any Indemnified Taxes or Other Taxes from such payments, then
(i) the sum payable shall be increased as necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) the Agent, Lender or Fronting Bank (as the case may be)
receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower shall make such deductions and (iii) the
Borrower shall pay the full amount deducted to the relevant Governmental
Authority in accordance with applicable law.
(b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
(c) The Borrower will indemnify the Agent, each Lender and the
Fronting Bank, within 10 days after written demand therefor, for the full amount
of any Indemnified Taxes or Other Taxes paid by the Agent, such Lender or the
Fronting Bank, as the case may be, on or with respect to any payment by or on
account of any obligation of the Borrower hereunder (including Indemnified Taxes
or Other Taxes imposed or asserted on or attributable to amounts payable under
this Section) and any penalties, interest and reasonable expenses arising
therefrom or with respect thereto, whether or not such Indemnified Taxes or
Other Taxes were correctly or legally imposed or asserted by the relevant
Governmental Authority. A certificate as to the amount of such payment or
liability delivered to the Borrower by a Lender or the Fronting Bank, or by the
Agent on its own behalf or on behalf of a Lender or the Fronting Bank, shall be
conclusive absent manifest error.
32
(d) As soon as practicable after any payment of Indemnified Taxes or
Other Taxes by the Borrower to a Governmental Authority, the Borrower shall
deliver to the Agent the original or a certified copy of a receipt issued by
such Governmental Authority evidencing such payment, a copy of the return
reporting such payment or other evidence of such payment reasonably satisfactory
to the Agent.
(e) Any Foreign Lender that is entitled to an exemption from or
reduction of withholding tax under the law of the jurisdiction in which the
Borrower is located, or any treaty to which such jurisdiction is a party, with
respect to payments under this Agreement or any other Loan Document shall
deliver to the Borrower (with a copy to the Agent), at the time or times
prescribed by applicable law, such properly completed and executed documentation
prescribed by applicable law or reasonably requested by the Borrower as will
permit such payments to be made without withholding or at a reduced rate.
SECTION 2.19 CERTAIN FEES. The Borrower shall pay to the Agent, for the
respective accounts of the Agent and the Lenders, the fees set forth in that
certain fee letter dated February 1, 2002 among the Agent, X.X. Xxxxxx
Securities Inc. and the Borrower at the times set forth therein.
SECTION 2.20 COMMITMENT FEE. The Borrower shall pay to the Lenders a
commitment fee (the "COMMITMENT FEE") for the period commencing on the Closing
Date to the Termination Date or the earlier date of termination of the
Commitment, computed (on the basis of the actual number of days elapsed over a
year of 360 days) at the rate of one-half of one percent (1/2%) per annum on the
average daily Unused Total Commitment. Such Commitment Fee, to the extent then
accrued, shall be payable (x) monthly, in arrears, on the last calendar day of
each month, (y) on the Termination Date and (z) as provided in Section 2.10
hereof, upon any reduction or termination in whole or in part of the Total
Commitment.
SECTION 2.21 LETTER OF CREDIT FEES. The Borrower shall pay with respect
to each Letter of Credit (i) to the Agent on behalf of the Lenders a fee
calculated (on the basis of the actual number of days elapsed over a year of 360
days) at the rate of (x) three and one-half percent (3 1/2%) per annum on the
daily average Letter of Credit Outstandings and (ii) to the Fronting Bank such
Fronting Bank's customary fees for issuance, amendments and processing referred
to in Section 2.03. In addition, the Borrower agrees to pay each Fronting Bank
for its account a fronting fee of one quarter of one percent (1/4%) per annum in
respect of each Letter of Credit issued by such Fronting Bank, for the period
from and including the date of issuance of such Letter of Credit to and
including the date of termination of such Letter of Credit. Accrued fees
described in clause (i) of the first sentence of this paragraph in respect of
each Letter of Credit shall be due and payable monthly in arrears on the last
calendar day of each month and on the Termination Date. Accrued fees described
in clause (ii) of the first sentence of this paragraph in respect of each Letter
of Credit shall be payable at times to be determined by the Fronting Bank, the
Borrower and the Agent.
SECTION 2.22 NATURE OF FEES. All Fees shall be paid on the dates due,
in immediately available funds, to the Agent for the respective accounts of the
Agent and the Lenders, as provided herein and in the fee letter described in
Section 2.19. Once paid, none of the Fees shall be refundable under any
circumstances.
33
SECTION 2.23 PRIORITY AND LIENS.
(a) The Borrower and each of the Guarantors hereby covenants,
represents and warrants that, upon entry of the Interim Order (and the Final
Order, as applicable), the Obligations of the Borrower and the Guarantors
hereunder and under the Loan Documents and in respect of Indebtedness owing to
JPMorgan Chase Bank and its banking Affiliates permitted by Section 6.03(vi):
(i) pursuant to Section 364(c)(1) of the Bankruptcy Code, shall at all times
constitute allowed administrative expense claims in the Cases having priority
over all administrative expenses of the kind specified in Sections 503(b) or
507(b) of the Bankruptcy Code; (ii) pursuant to Section 364(c)(2) of the
Bankruptcy Code, shall at all times be secured by a perfected first priority
Lien on all unencumbered property of the Borrower and the Guarantors' respective
estates in the Cases, including, without limitation, all accounts receivable,
inventory, property, plant and equipment of the Borrower and Guarantors
(excluding the Borrower's and the Guarantors' rights in respect of avoidance
actions under the Bankruptcy Code) and on all cash maintained in the Letter of
Credit Account and any direct investments of the funds contained therein; (iii)
pursuant to Section 364(c)(3) of the Bankruptcy Code, shall be secured by a
perfected Lien upon all property of the Borrower and the Guarantors (other than
the property that is subject to existing Liens that presently secure the
obligations of the Borrower and the Guarantors under the Existing Agreement, as
to which the Lien in favor of the Agent and the Lenders will be as described in
clause (iv) of this sentence) that is subject to valid, perfected and
non-avoidable Liens in existence on the Filing Date or to valid Liens in
existence on the Filing Date that are perfected subsequent to the Filing Date as
permitted by Section 546(b) of the Bankruptcy Code or to Permitted Liens, junior
to such valid, perfected and non-avoidable Liens; and (iv) pursuant to Section
364(d)(1) of the Bankruptcy Code, shall be secured by a perfected first
priority, senior priming Lien on all of the tangible and intangible property of
the Borrower and the Guarantors (including without limitation, accounts
receivable, inventory, patents, copyrights, trademarks, tradenames and all other
intellectual property, and the capital stock of all direct subsidiaries of the
Borrower and each Guarantor and the proceeds thereof) that is subject to
existing Liens that presently secure the Borrower's and the Guarantors'
pre-petition Indebtedness under the Existing Agreement (but subject to any Liens
in existence on the Filing Date to which the Liens being primed hereby are
subject or become subject subsequent to the Filing Date as permitted by Section
546(b) of the Bankruptcy Code) and any Liens granted after the Filing Date to
provide adequate protection in respect of the Existing Agreement, senior to all
of such Liens; PROVIDED, HOWEVER, the Borrower shall not be required to pledge
to the Agent in excess of 65% of the capital stock of its foreign Subsidiaries;
subject only to (x) in the event of the occurrence and during the continuance of
an Event of Default or an event that would constitute an Event of Default with
the giving of notice or lapse of time or both, the payment of allowed and unpaid
professional fees and disbursements incurred by the Borrower, the Guarantors and
any statutory committees appointed in the Cases in an aggregate amount not in
excess of $2,000,000 (plus all unpaid professional fees and disbursements
incurred prior to the occurrence of an Event of Default or an event that would
constitute an Event of Default with the giving of notice or lapse of time or
both and reflected on the most recent Borrowing Base Certificate delivered to
the Agent to the extent allowed by the Bankruptcy Court at any time) and (y) the
payment of unpaid fees pursuant to 28 U.S.C. Section 1930 and to the Clerk of
the Bankruptcy Court (collectively, the "CARVE-OUT"), PROVIDED that, except as
otherwise provided in the Orders, no portion of the Carve-Out shall be utilized
for the payment of professional fees and disbursements incurred in connection
with any challenge to the amount, extent, priority, validity,
34
perfection or enforcement of the indebtedness of the Borrower and the Guarantors
owing to the Existing Lenders or the Lenders or to the collateral securing such
indebtedness. The Lenders agree that so long as no Event of Default or event
which with the giving of notice or lapse of time or both would constitute an
Event of Default shall have occurred, the Borrower and the Guarantors shall be
permitted to pay compensation and reimbursement of expenses allowed and payable
under 11 U.S.C. Sections 328, 330 and 331, as the same may be due and payable,
and the same shall not reduce the Carve-Out.
(b) Subject to the priorities set forth in subsection (a) above and
to the Carve-Out, as to all real property the title to which is held by the
Borrower or any of the Guarantors, or the possession of which is held by the
Borrower or any of the Guarantors pursuant to leasehold interest and which
secures the obligations under the Existing Agreement, the Borrower and each
Guarantor hereby assigns and conveys as security, grants a security interest in,
hypothecates, mortgages, pledges and sets over unto the Agent on behalf of the
Lenders all of the right, title and interest of the Borrower and such Guarantor
in all of such owned real property and in all such leasehold interests, together
in each case with all of the right, title and interest of the Borrower and such
Guarantor in and to all buildings, improvements, and fixtures related thereto,
any lease or sublease thereof, all general intangibles relating thereto and all
proceeds thereof. The Borrower and each Guarantor acknowledges that, pursuant to
the Orders, the Liens in favor of the Agent on behalf of the Lenders in all of
such real property and leasehold instruments shall be perfected without the
recordation of any instruments of mortgage or assignment. The Borrower and each
Guarantor further agree that, upon the request of the Agent, the Borrower and
such Guarantor shall enter into separate fee and leasehold mortgages in
recordable form with respect to such properties on terms reasonably satisfactory
to the Agent.
SECTION 2.24 RIGHT OF SET-OFF. Subject to the provisions of
Section 7.01, upon the occurrence and during the continuance of any Event of
Default, the Agent and each Lender is hereby authorized at any time and from
time to time, to the fullest extent permitted by law and without further order
of or application to the Bankruptcy Court, to set off and apply any and all
deposits (general or special, time or demand, provisional or final but excluding
deposits designated as payroll accounts and any trust accounts) at any time held
and other indebtedness at any time owing by the Agent and each such Lender to or
for the credit or the account of the Borrower or any Guarantor against any and
all of the obligations of such Borrower or Guarantor now or hereafter existing
under the Loan Documents, irrespective of whether or not such Lender shall have
made any demand under any Loan Document and although such obligations may not
have been accelerated. Each Lender and the Agent agrees promptly to notify the
Borrower and Guarantors after any such set-off and application made by such
Lender or by the Agent, as the case may be, provided that the failure to give
such notice shall not affect the validity of such set-off and application. The
rights of each Lender and the Agent under this Section are in addition to other
rights and remedies which such Lender and the Agent may have upon the occurrence
and during the continuance of any Event of Default.
SECTION 2.25 SECURITY INTEREST IN LETTER OF CREDIT ACCOUNT. Pursuant to
Section 364(c)(2) of the Bankruptcy Code, the Borrower and the Guarantors hereby
assign and pledge to the Agent, for its benefit and for the ratable benefit of
the Lenders, and hereby grant to the Agent, for its benefit and for the ratable
benefit of the Lenders, a first priority security interest, senior to all other
Liens, if any, in all of the Borrower's and the Guarantors' right, title and
35
interest in and to the Letter of Credit Account and any direct investment of the
funds contained therein. Cash held in the Letter of Credit Account shall not be
available for use by the Borrower, whether pursuant to Section 363 of the
Bankruptcy Code or otherwise and shall be released to the Borrower as described
in clause (ii)(y) of Section 2.03(b).
SECTION 2.26 PAYMENT OF OBLIGATIONS. Subject to the provisions of
Section 7.01, upon the maturity (whether by acceleration or otherwise) of any of
the Obligations under this Agreement or any of the other Loan Documents of the
Borrower and the Guarantors, the Lenders shall be entitled to immediate payment
of such Obligations without further application to or order of the Bankruptcy
Court.
SECTION 2.27 NO DISCHARGE; SURVIVAL OF CLAIMS. Each of the Borrower and
the Guarantors agrees that (i) its obligations hereunder shall not be discharged
by the entry of an order confirming a Reorganization Plan (and each of the
Borrower and the Guarantors, pursuant to Section 1141(d)(4) of the Bankruptcy
Code, hereby waives any such discharge) and (ii) the Superpriority Claim granted
to the Agent and the Lenders pursuant to the Orders and described in Section
2.23 and the Liens granted to the Agent pursuant to the Orders and described in
Sections 2.23 and 2.25 shall not be affected in any manner by the entry of an
order confirming a Reorganization Plan.
SECTION 2.28 USE OF CASH COLLATERAL. Notwithstanding anything to the
contrary contained herein, the Borrower shall not be permitted (i) to request a
Borrowing under Section 2.06 or request the issuance of a Letter of Credit under
Section 2.04 unless the Bankruptcy Court shall have entered the Interim Order or
(ii) to request a Borrowing under Section 2.06 unless the Borrower and the
Guarantors shall at that time have the use of all cash collateral subject to the
Orders for the purposes described in Section 3.09.
SECTION 3. REPRESENTATIONS AND WARRANTIES
In order to induce the Lenders to make Loans and issue and/or
participate in Letters of Credit hereunder, the Borrower and each of the
Guarantors jointly and severally represent and warrant as follows:
SECTION 3.01 ORGANIZATION AND AUTHORITY. Each of the Borrower and the
Guarantors (i) is a corporation duly organized and validly existing under the
laws of the State of its incorporation and is duly qualified as a foreign
corporation and is in good standing in each jurisdiction in which the failure to
so qualify would have a material adverse effect on the financial condition,
operations, business, properties, assets or prospects of the Borrower and the
Guarantors taken as a whole; (ii) subject to the entry by the Bankruptcy Court
of the Interim Order (or the Final Order, when applicable) has the requisite
corporate power and authority to effect the transactions contemplated hereby,
and by the other Loan Documents to which it is a party, and (iii) subject to the
entry by the Bankruptcy Court of the Interim Order (or the Final Order, when
applicable) has all requisite corporate power and authority and the legal right
to own, pledge, mortgage and operate its properties, and to conduct its business
as now or currently proposed to be conducted.
36
SECTION 3.02 DUE EXECUTION. Upon the entry by the Bankruptcy Court of
the Interim Order (or the Final Order, when applicable), the execution, delivery
and performance by each of the Borrower and the Guarantors of each of the Loan
Documents to which it is a party (i) are within the respective corporate powers
of each of the Borrower and the Guarantors, have been duly authorized by all
necessary corporate action including the consent of shareholders where required,
and do not (A) contravene the charter or by-laws of any of the Borrower or the
Guarantors, (B) violate any law (including, without limitation, the Securities
Exchange Act of 1934) or regulation (including, without limitation, Regulations
T, U or X of the Board of Governors of the Federal Reserve System), or any order
or decree of any court or Governmental Authority, (C) conflict with or result in
a breach of, or constitute a default under, any material indenture, mortgage or
deed of trust entered into after the Filing Date or any material lease,
agreement or other instrument entered into after the Filing Date binding on the
Borrower or the Guarantors or any of their properties, or (D) result in or
require the creation or imposition of any Lien upon any of the property of any
of the Borrower or the Guarantors other than the Liens granted pursuant to this
Agreement, the other Loan Documents or the Orders; and (ii) do not require the
consent, authorization by or approval of or notice to or filing or registration
with any Governmental Authority other than the entry of the Orders. Upon the
entry by the Bankruptcy Court of the Interim Order (or the Final Order, when
applicable), this Agreement has been duly executed and delivered by each of the
Borrower and the Guarantors. This Agreement is, and each of the other Loan
Documents to which the Borrower and each of the Guarantors is or will be a
party, when delivered hereunder or thereunder, will be, a legal, valid and
binding obligation of the Borrower and each Guarantor, as the case may be,
enforceable against the Borrower and the Guarantors, as the case may be, in
accordance with its terms and the Orders.
SECTION 3.03 STATEMENTS MADE. The information that has been prepared by
or at the request of the Borrower or any Guarantor and delivered in writing by
the Borrower or any of the Guarantors to the Agent or to the Bankruptcy Court in
connection with any Loan Document, and any financial statement delivered
pursuant hereto or thereto (other than to the extent that any such statements
constitute projections), taken as a whole and in light of the circumstances in
which made, contains no untrue statement of a material fact and does not omit to
state a material fact necessary to make such statements not misleading; and, to
the extent that any such information constitutes projections, such projections
were prepared in good faith on the basis of assumptions, methods, data, tests
and information believed by the Borrower or such Guarantor to be reasonable at
the time such projections were furnished.
SECTION 3.04 FINANCIAL STATEMENTS. The Borrower has furnished the
Lenders with copies of the audited consolidated financial statements and
schedules of the Borrower for the fiscal year ended December 29, 2001. Such
financial statements present fairly, in accordance with GAAP, the financial
condition and results of operations of the Borrower and the Guarantors on a
consolidated basis as of such date and for such period; such balance sheets and
the notes thereto disclose all liabilities, direct or contingent, of the
Borrower and the Guarantors as of the date thereof required to be disclosed by
GAAP and such financial statements were prepared in a manner consistent with
GAAP. Except as reflected on Schedule 3.04, no material adverse change in the
operations, business, properties, assets, prospects or condition (financial or
otherwise) of the Borrower and the Guarantors, taken as a whole, has occurred
from that set forth in the Borrower's consolidated financial statements for the
fiscal year ended December 29, 2001 other than those which customarily occur as
a result of events leading up to and following the
37
commencement of a proceeding under Chapter 11 of the Bankruptcy Code and the
commencement of the Cases (including, without limitation, those reflected in the
financial projections heretofore made available to the Agent).
SECTION 3.05 OWNERSHIP. Other than as set forth on Schedule 3.05, (i)
each of the Persons listed on Schedule 3.05 is a wholly-owned, direct or
indirect Subsidiary of the Borrower, and (ii) the Borrower owns no other
Subsidiaries, whether directly or indirectly. Each of the Borrower's domestic
Subsidiaries is a Guarantor.
SECTION 3.06 LIENS. Except for Liens existing on the Filing Date as
reflected on Schedule 3.06, there are no Liens of any nature whatsoever on any
assets of the Borrower or any of the Guarantors other than: (i) Liens granted
pursuant to the Existing Agreement; (ii) Permitted Liens; (iii) other Liens
permitted pursuant to Section 6.01; and (iv) Liens in favor of the Agent and the
Lenders. Neither the Borrower nor the Guarantors are parties to any contract,
agreement, lease or instrument the performance of which, either unconditionally
or upon the happening of an event, will result in or require the creation of a
Lien on any assets of the Borrower or any Guarantor or otherwise result in a
violation of this Agreement other than the Liens granted to the Agent and the
Lenders as provided for in this Agreement.
SECTION 3.07 COMPLIANCE WITH LAW.
(a) Except for matters which could not reasonably be expected to have
a material adverse effect on the financial condition, operations, business,
properties, assets or prospects of the Borrower and the Guarantors taken as a
whole (i) the operations of the Borrower and the Guarantors comply in all
material respects with all applicable environmental, health and safety statutes
and regulations, including, without limitation, regulations promulgated under
the Resource Conservation and Recovery Act (42 U.S.C. Sections 6901 ET SEQ.);
(ii) to the Borrower's and each of the Guarantor's knowledge, none of the
operations of the Borrower or the Guarantors is the subject of any Federal or
state investigation evaluating whether any remedial action involving a material
expenditure by the Borrower or any Guarantor is needed to respond to a release
of any Hazardous Waste or Hazardous Substance (as such terms are defined in any
applicable state or Federal environmental law or regulations) into the
environment; and (iii) to the Borrower's and each of the Guarantor's knowledge,
the Borrower and the Guarantors do not have any material contingent liability in
connection with any release of any Hazardous Waste or Hazardous Substance into
the environment.
(b) Neither the Borrower nor any Guarantor is, to the best of its
knowledge, in violation of any law, rule or regulation, or in default with
respect to any judgment, writ, injunction or decree of any Governmental
Authority the violation of which, or a default with respect to which, would have
a material adverse effect on the financial condition, operations, business,
properties, assets or prospects of the Borrower and the Guarantors taken as a
whole.
SECTION 3.08 INSURANCE. All policies of insurance of any kind or nature
owned by or issued to the Borrower and the Guarantors, including, without
limitation, policies of life, fire, theft, product liability, public liability,
property damage, other casualty, employee fidelity, workers' compensation,
employee health and welfare, title, property and liability insurance, are
38
in full force and effect and are of a nature and provide such coverage as is
customarily carried by companies of the size and character of the Borrower and
the Guarantors.
SECTION 3.09 USE OF PROCEEDS. The proceeds of the Loans shall be used
for general corporate purposes of the Borrower and the Guarantors (including, to
the extent permitted under Section 6.10, for loans and advances to Subsidiaries
not party hereto).
SECTION 3.10 LITIGATION. Other than as set forth on Schedule 3.10, there
are no unstayed actions, suits or proceedings pending or, to the knowledge of
the Borrower or the Guarantors, threatened against or affecting the Borrower or
the Guarantors or any of their respective properties, before any court or
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, which is reasonably likely to be determined adversely to
the Borrower or the Guarantors and, if so determined adversely to the Borrower
or the Guarantors would have a material adverse effect on the financial
condition, business, properties, prospects, operations or assets of the Borrower
and the Guarantors, taken as a whole.
SECTION 4. CONDITIONS OF LENDING
SECTION 4.01 CONDITIONS PRECEDENT TO INITIAL LOANS AND INITIAL LETTERS
OF CREDIT. The obligation of the Lenders to make the initial Loans or the
Fronting Bank to issue the initial Letter of Credit, whichever may occur first,
is subject to the following conditions precedent:
(a) SUPPORTING DOCUMENTS. The Agent shall have received for each of
the Borrower and the Guarantors:
(i) a copy of such entity's certificate of incorporation, as
amended, certified as of a recent date by the Secretary of State of the state of
its incorporation;
(ii) a certificate of such Secretary of State, dated as of a
recent date, as to the good standing of and payment of taxes by that entity and
as to the charter documents on file in the office of such Secretary of State;
and
(iii) a certificate of the Secretary or an Assistant Secretary
of that entity dated the date of the initial Loans or the initial Letter of
Credit hereunder, whichever first occurs, and certifying (A) that attached
thereto is a true and complete copy of the by-laws of that entity as in effect
on the date of such certification, (B) that attached thereto is a true and
complete copy of resolutions adopted by the Board of Directors of that entity
authorizing the Borrowings and Letter of Credit extensions hereunder, the
execution, delivery and performance in accordance with their respective terms of
this Agreement, the Loan Documents and any other documents required or
contemplated hereunder or thereunder and the granting of the security interest
in the Letter of Credit Account and other Liens contemplated hereby, (C) that
the certificate of incorporation of that entity has not been amended since the
date of the last amendment thereto indicated on the certificate of the Secretary
of State furnished pursuant to clause (i) above and (D) as to the incumbency and
specimen signature of each officer of that entity executing this Agreement and
the Loan Documents or any other document delivered by it in connection herewith
or therewith (such certificate to contain a certification by another officer of
that entity as to the incumbency and signature of the officer signing the
certificate referred to in this clause (iii)).
39
(b) INTERIM ORDER. At the time of the making of the initial Loans or
at the time of the issuance of the initial Letters of Credit, whichever first
occurs, the Agent and the Lenders shall have received satisfactory evidence of
the entry of an order of the Bankruptcy Court in substantially the form of
Exhibit A (the "INTERIM ORDER") approving the Loan Documents and granting the
Superpriority Claim status and senior priming and other Liens described in
Section 2.23 which Interim Order (i) shall have been entered, with the consent
or non-objection of a preponderance (as determined by the Agent) of the Existing
Lenders, upon an application or motion of the Borrower reasonably satisfactory
in form and substance to the Agent, on such prior notice to such parties
(including the Existing Lenders) as may in each case be reasonably satisfactory
to the Agent, (ii) shall authorize extensions of credit in amounts not in excess
of $25,000,000 in the aggregate, (iii) shall approve the payment by the Borrower
of all of the Fees referred to in Section 2.19, (iv) shall be in full force and
effect, (v) shall have authorized the use by the Borrower and the Guarantors of
any cash collateral in which any Existing Lender under the Existing Agreement
may have an interest and shall have provided, as adequate protection for the use
of such cash collateral and the priming contemplated hereby, for (A) the monthly
payment of current interest and letter of credit fees (including the payment on
the Closing Date of any such interest and fees that are accrued and unpaid as of
the Filing Date) at the rates at which such interest and fees were being paid
pursuant to the Existing Agreement for the period immediately prior to the
Filing Date (the payments described in this clause to be without prejudice to
the rights of any Existing Lender to assert a claim for the payment of
additional interest and letters of credit fees calculated at any other
applicable rates of interest (including, without limitation, at any default
rates), or on any other basis, set forth in the Existing Agreement or to the
rights of the Borrower to contest such assertion), (B) a superpriority claim as
contemplated by Section 507(b) of the Bankruptcy Code immediately junior to the
claims under Section 364(c)(1) of the Bankruptcy Code held by the Agent and the
Lenders (without the requirement to file any motion or pleading or to make any
demand), (C) a Lien on substantially all of the assets of the Borrower and the
Guarantors having a priority immediately junior to the priming and other Liens
granted in favor of the Agent and the Lenders hereunder and under the other Loan
Documents, (D) the payment on a current and monthly basis of the fees and
disbursements of respective professionals (including, but not limited to, the
fees and disbursements of counsel and internal and third-party consultants,
including financial consultants, and auditors) for the Pre-Petition Agent
(including the payment on the Closing Date or as soon thereafter as is
practicable of any unpaid pre-petition fees and expenses) and the continuation
of the payment to the Pre-Petition Agent on a current basis of the
administration fees that are provided for under the Existing Agreement, (E)
pending the entry of the Final Order, the receipt of a weekly budget showing the
Borrower's use of cash collateral in which any Existing Lender under the
Existing Agreement may have an interest, (F) reasonable access during normal
business hours by Xxxxxxx and Marsal ("A&M"), or any successor advisor as the
representative of the Pre-Petition Agent, to all documentation, places of
business, officers, consultants and employees of the Borrower, (G) receipt of
such financial information concerning the Borrower and the Guarantors' cash
flow, business plan and other aspects of its operations as A&M or such successor
may reasonably request from time to time, all without material disruption to the
operation of the business of any of the Borrower or the Guarantors, and (H) the
receipt of all financial statements, borrowing base certificates and other
reports that are furnished to the Lenders and such other protection as agreed
between the Borrower, the Guarantors and the Existing Lenders; and (vi) shall
not have been vacated, stayed, reversed, modified or amended in
40
any respect; and, if the Interim Order is the subject of a pending appeal in any
respect, neither the making of such Loans nor the issuance of such Letter of
Credit nor the performance by the Borrower or any of the Guarantors of any of
their respective obligations hereunder or under the Loan Documents or under any
other instrument or agreement referred to herein shall be the subject of a
presently effective stay pending appeal.
(c) SECURITY AND PLEDGE AGREEMENT. The Borrower and each of the
Guarantors shall have duly executed and delivered to the Agent a Security and
Pledge Agreement in substantially the form of Exhibit B (the "SECURITY AND
PLEDGE AGREEMENT").
(d) FIRST DAY ORDERS. All of the "first day orders" entered by the
Bankruptcy Court at the time of the commencement of the Cases shall be
reasonably satisfactory in form and substance to the Agent.
(e) OPINION OF COUNSEL. The Agent and the Lenders shall have received
the favorable written opinion of counsel to the Borrower and the Guarantors
reasonably acceptable to the Agent, dated the date of the initial Loans or the
issuance of the initial Letter of Credit, whichever first occurs, substantially
in the form of Exhibit C.
(f) PAYMENT OF FEES. The Borrower shall have paid to the Agent the
then unpaid balance of all accrued and unpaid Fees due under and pursuant to
this Agreement and the letter referred to in Section 2.19.
(g) CORPORATE AND JUDICIAL PROCEEDINGS. All corporate and judicial
proceedings and all instruments and agreements in connection with the
transactions among the Borrower, the Guarantors, the Agent and the Lenders
contemplated by this Agreement shall be reasonably satisfactory in form and
substance to the Agent, and the Agent shall have received all information and
copies of all documents and papers, including records of corporate and judicial
proceedings, which the Agent may have reasonably requested in connection
therewith, such documents and papers where appropriate to be certified by proper
corporate, governmental or judicial authorities.
(h) INFORMATION. The Agent shall have received such information
(financial or otherwise) as may be reasonably requested by the Agent and shall
have discussed the Borrower's business plan heretofore delivered to the Agent
with the Borrower's management and shall be reasonably satisfied with the nature
and substance of such discussions.
(i) BUSINESS PLAN. The Agent shall have received from the Borrower
the Borrower's business plans, consolidated and by division, for the period
ending on the Maturity Date and such business plans shall be satisfactory in
form and substance to the Agent (and the Agent acknowledges that it has
heretofore received such business plans).
(j) COMPLIANCE WITH LAWS. The Borrower and the Guarantors shall have
granted the Agent access to and the right to inspect all reports, audits and
other internal information of the Borrower and the Guarantors relating to
environmental matters, and any third party verification of certain matters
relating to compliance with environmental laws and regulations reasonably
requested by the Agent, and the Agent shall be reasonably satisfied that the
Borrower and the Guarantors are in compliance in all material respects with all
applicable
41
environmental laws and regulations and the Borrower has made adequate provision
for the costs of maintaining such compliance.
(k) UCC SEARCHES. The Agent shall have received UCC searches
(including tax liens and judgments) conducted in the jurisdictions in which the
Borrower and the Guarantors conduct business (dated as of a date reasonably
satisfactory to the Agent), reflecting the absence of Liens and encumbrances on
the assets of the Borrower and the Guarantors other than Liens granted or
permitted under the Existing Agreement and such other Liens as may be reasonably
satisfactory to the Agent.
(l) CLOSING DOCUMENTS. The Agent shall have received all documents
required by Section 4.01 reasonably satisfactory in form and substance to the
Agent.
SECTION 4.02 CONDITIONS PRECEDENT TO EACH LOAN AND EACH LETTER OF
CREDIT. The obligation of the Lenders to make each Loan and of the Fronting Bank
to issue each Letter of Credit, including the initial Loan and the initial
Letter of Credit, is subject to the following conditions precedent:
(a) NOTICE. The Agent shall have received a notice with respect to
such borrowing or issuance, as the case may be, as required by Section 2.
(b) REPRESENTATIONS AND WARRANTIES. All representations and
warranties contained in this Agreement and the other Loan Documents shall be
true and correct in all material respects on and as of the date of each
Borrowing or the issuance of each Letter of Credit hereunder with the same
effect as if made on and as of such date except to the extent such
representations and warranties expressly relate to an earlier date.
(c) NO DEFAULT. On the date of each Borrowing hereunder or the
issuance of each Letter of Credit, no Event of Default or event which upon
notice or lapse of time or both would constitute an Event of Default shall have
occurred and be continuing.
(d) ORDERS. The Interim Order shall be in full force and effect and
shall not have been stayed, reversed, modified or amended in any respect without
the prior written consent of the Agent, the Required Lenders and the
Pre-Petition Agent, PROVIDED, that at the time of the making of any Loan or the
issuance of any Letter of Credit the aggregate amount of either of which, when
added to the sum of the principal amount of all Loans then outstanding and the
Letter of Credit Outstandings, would exceed the amount authorized by the Interim
Order (collectively, the "ADDITIONAL CREDIT"), the Agent and each of the Lenders
shall have received satisfactory evidence of the entry of an order of the
Bankruptcy Court in substantially the form of the Interim Order (with only such
modifications thereto as are satisfactory in form and substance to the Agent)
(the "FINAL ORDER") which, in any event, shall have been entered by the
Bankruptcy Court no later than thirty (30) days after the entry of the Interim
Order and at the time of the extension of any Additional Credit the Final Order
shall be in full force and effect, and shall not have been vacated, stayed,
reversed, modified or amended in any respect without the prior written consent
of the Agent, and the Required Lenders and the Pre-Petition Agent; and if either
the Interim Order or the Final Order is the subject of a pending appeal in any
respect, neither the making of the Loans nor the issuance of any Letter of
Credit nor the performance by the
42
Borrower or any Guarantor of any of their respective obligations under any of
the Loan Documents shall be the subject of a presently effective stay pending
appeal.
(e) PAYMENT OF FEES. The Borrower shall have paid to the Agent and
the Pre-Petition Agent the then unpaid balance of all accrued and unpaid Fees
then payable under and pursuant to this Agreement, the Orders and the letter
referred to in Section 2.19.
(f) BORROWING BASE CERTIFICATE. The Agent shall have received the
timely delivery of the most recent Borrowing Base Certificate (dated no more
than seven (7) days prior to the making of a Loan or the issuance of a Letter of
Credit) required to be delivered hereunder.
The request by the Borrower for, and the acceptance by the Borrower of, each
extension of credit hereunder shall be deemed to be a representation and
warranty by the Borrower that the conditions specified in this Section have been
satisfied or waived at that time.
SECTION 5. AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.03(b)), or any amount shall remain outstanding or
unpaid under this Agreement, the Borrower and each of the Guarantors agree that,
unless the Required Lenders shall otherwise consent in writing, the Borrower and
each of the Guarantors will:
SECTION 5.01 FINANCIAL STATEMENTS, REPORTS, ETC. In the case of the
Borrower and the Guarantors, deliver to the Agent and each of the Lenders:
(a) on or before April 23, 2002 for the fiscal year ended December
30, 2001 and within 90 days after the end of each subsequent fiscal year, the
Borrower's consolidated balance sheet and related statement of income and cash
flows, showing the financial condition of the Borrower and its Subsidiaries on a
consolidated basis as of the close of such fiscal year and the results of their
respective operations during such year, the consolidated statement of the
Borrower to be audited for the Borrower and the Subsidiaries by Ernst & Young
LLP or other independent public accountants of recognized national standing and
accompanied by an opinion of such accountants (which shall not be qualified in
any material respect other than with respect to the Cases or a going concern
qualification) and to be certified by a Financial Officer of the Borrower to the
effect that such consolidated financial statements fairly present the financial
condition and results of operations of the Borrower and the Subsidiaries on a
consolidated basis in accordance with GAAP;
(b) within 45 days after the end of each of the first three fiscal
quarters, the Borrower's consolidated balance sheets and related statements of
income and cash flows, showing the financial condition of the Borrower and its
Subsidiaries on a consolidated basis as of the close of such fiscal quarter and
the results of their operations during such fiscal quarter and the then elapsed
portion of the fiscal year, each certified by a Financial Officer as fairly
presenting the financial condition and results of operations of the Borrower and
its Subsidiaries on a consolidated basis in accordance with GAAP, subject to
normal year-end audit adjustments;
43
(c) commencing with the first fiscal month following the Closing
Date, as soon as practicable, but in no event later than 30 days after the end
of each fiscal month of the Borrower (unless such monthly fiscal period ends at
the end of a fiscal quarter, in which case the financial statements required to
be delivered pursuant to this clause (c) may be delivered within 45 days after
the end of such fiscal month) (i) monthly unaudited balance sheets of the
Borrower and its Subsidiaries and related statements of earnings and cash flows
of the Borrower and its Subsidiaries for the prior fiscal month, each certified
by a Financial Officer of the Borrower and (ii) a monthly report detailing
professional fees and expenses that have been billed and paid or billed but
unpaid to date, the accumulated "hold-back" of professional fees and expenses to
date, material adverse events or changes (if any) and material litigation (if
any);
(d) (i) concurrently with any delivery of financial statements under
(a) and (b) above, a certificate of the Financial Officer certifying such
statements (A) certifying that no Event of Default or event which upon notice or
lapse of time or both would constitute an Event of Default has occurred, or, if
such an Event of Default or event has occurred, specifying the nature and extent
thereof and any corrective action taken or proposed to be taken with respect
thereto and (B) setting forth computations in reasonable detail satisfactory to
the Agent demonstrating compliance with the provisions of Sections 6.04, 6.05
and 6.10 and (ii) concurrently with any delivery of financial statements under
(a) above, a certificate (which certificate may be limited to accounting matters
and disclaim responsibility for legal interpretations) of the accountants
auditing the consolidated financial statements delivered under (a) above
certifying that, in the course of the regular audit of the business of the
Borrower and its Subsidiaries, such accountants have obtained no knowledge that
an Event of Default has occurred and is continuing, or if, in the opinion of
such accountants, an Event of Default has occurred and is continuing, specifying
the nature thereof and all relevant facts with respect thereto;
(e) as soon as possible, and in any event when the Borrower's and the
Guarantor's statement of financial affairs and schedules of asset and
liabilities are required to be filed with the Bankruptcy Court (but no later
than 45 days after the Closing Date or such later date to which the Bankruptcy
Court extends the filing thereof), a consolidated PRO FORMA balance sheet of the
Borrower's and the Guarantors' financial condition as of the Filing Date;
(f) not later than 5:00 p.m. New York time on the first Thursday
following the Filing Date and on each Thursday thereafter, the Borrower's and
the Subsidiaries' forecast of cash receipts and disbursements for the ensuing
13-week period together with a reconciliation of such forecasted cash flows to
actual results;
(g) promptly after the same become publicly available, copies of all
periodic and other reports, proxy statements and other materials filed by it
with the Securities and Exchange Commission, or any governmental authority
succeeding to any of or all the functions of said commission, or with any
national securities exchange, as the case may be;
(h) as soon as available and in any event (A) within 30 days after
the Borrower or any of its ERISA Affiliates knows or has reason to know that any
Termination Event described in clause (i) of the definition of Termination Event
with respect to any Single Employer Plan of the Borrower or such ERISA Affiliate
has occurred and (B) within 10 days
44
after the Borrower or any of its ERISA Affiliates knows or has reason to know
that any other Termination Event with respect to any such Plan has occurred, a
statement of a Financial Officer of the Borrower describing the full details of
such Termination Event and the action, if any, which the Borrower or such ERISA
Affiliate is required or proposes to take with respect thereto, together with
any notices required or proposed to be given to or filed with or by the
Borrower, the ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto;
(i) promptly and in any event within 10 days after receipt thereof by
the Borrower or any of its ERISA Affiliates from the PBGC copies of each notice
received by the Borrower or any such ERISA Affiliate of the PBGC's intention to
terminate any Single Employer Plan of the Borrower or such ERISA Affiliate or to
have a trustee appointed to administer any such Plan;
(j) if requested by the Agent, promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service, copies of each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) with
respect to each Single Employer Plan of the Borrower or any of its ERISA
Affiliates;
(k) within 10 days after notice is given or required to be given to
the PBGC under Section 302(f)(4)(A) of ERISA of the failure of the Borrower or
any of its ERISA Affiliates to make timely payments to a Plan, a copy of any
such notice filed and a statement of a Financial Officer of the Borrower setting
forth (A) sufficient information necessary to determine the amount of the lien
under Section 302(f)(3), (B) the reason for the failure to make the required
payments and (C) the action, if any, which the Borrower or any of its ERISA
Affiliates proposed to take with respect thereto;
(l) promptly and in any event within 10 days after receipt thereof by
the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor, a copy of
each notice received by the Borrower or any ERISA Affiliate concerning (A) the
imposition of Withdrawal Liability by a Multiemployer Plan, (B) the
determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA, (C) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA, or (D) the amount of
liability incurred, or which may be incurred, by the Borrower or any ERISA
Affiliate in connection with any event described in clause (A), (B) or (C)
above;
(m) promptly, from time to time, such other information regarding the
operations, business affairs and financial condition of the Borrower or any
Guarantor, or compliance with the terms of any material loan or financing
agreements as the Agent, at the request of any Lender, may reasonably request;
and
(n) furnish to the Agent and its counsel promptly after the same is
available, copies of all pleadings, motions, applications, judicial information,
financial information and other documents filed by or on behalf of the Borrower
or any of the Guarantors with the Bankruptcy Court in the Cases, or distributed
by or on behalf of the Borrower or any of the Guarantors to any official
committee appointed in the Cases.
45
SECTION 5.02 CORPORATE EXISTENCE. Preserve and maintain in full force
and effect all governmental rights, privileges, qualifications, permits,
licenses and franchises necessary or desirable in the normal conduct of its
business except (i)(A) if in the reasonable business judgment of the Borrower it
is no longer necessary for the Borrower and the Guarantors to preserve and
maintain such rights, privileges, qualifications, permits, licenses and
franchises, and (B) such failure to preserve the same could not, in the
aggregate, reasonably be expected to have a material adverse effect on the
operations, business, properties, assets, prospects or condition (financial or
otherwise) of the Borrower and the Guarantors, taken as a whole, and (ii) as
otherwise permitted in connection with sales of assets permitted by Section
6.11.
SECTION 5.03 INSURANCE. (a) Keep its insurable properties insured at all
times, against such risks, including fire and other risks insured against by
extended coverage, as is customary with companies of the same or similar size in
the same or similar businesses; and maintain in full force and effect public
liability insurance against claims for personal injury or death or property
damage occurring upon, in, about or in connection with the use of any properties
owned, occupied or controlled by the Borrower or any Guarantor, as the case may
be, in such amounts (giving effect to self-insurance) and with such deductibles
as are customary with companies of the same or similar size in the same or
similar businesses and in the same geographic area; and (b) maintain such other
insurance or self insurance as may be required by law.
SECTION 5.04 OBLIGATIONS AND TAXES. With respect to the Borrower and
each Guarantor, pay all its material obligations arising after the Filing Date
promptly and in accordance with their terms and pay and discharge promptly all
material taxes, assessments and governmental charges or levies imposed upon it
or upon its income or profits or in respect of its property arising after the
Filing Date, as well as all material lawful claims for labor, materials and
supplies or otherwise arising after the Filing Date which, if unpaid, would
become a Lien or charge upon such properties or any part thereof, before the
same shall become in default; provided, however, that the Borrower and each
Guarantor shall not be required to pay and discharge or to cause to be paid and
discharged any such obligation, tax, assessment, charge, levy or claim so long
as the validity or amount thereof shall be contested in good faith by
appropriate proceedings (if the Borrower and the Guarantors shall have set aside
on their books adequate reserves therefor).
SECTION 5.05 NOTICE OF EVENT OF DEFAULT, ETC. Promptly give to the Agent
notice in writing of any Event of Default or the occurrence of any event or
circumstance which with the passage of time or giving of notice or both would
constitute an Event of Default.
SECTION 5.06 ACCESS TO BOOKS AND RECORDS. Maintain or cause to be
maintained at all times true and complete books and records in a manner
consistent with GAAP of the financial operations of the Borrower and the
Guarantors; and provide the Agent and its representatives access to all such
books and records during regular business hours, in order that the Agent may
upon reasonable prior notice examine and make abstracts from such books,
accounts, records and other papers for the purpose of verifying the accuracy of
the various reports delivered by the Borrower or the Guarantors to the Agent or
the Lenders pursuant to this Agreement or for otherwise ascertaining compliance
with this Agreement; and at any reasonable time and from time to time during
regular business hours, upon reasonable notice, permit the Agent and any
46
agents or representatives (including, without limitation, appraisers) thereof to
visit the properties of the Borrower and the Guarantors and to conduct
examinations of and to monitor the Collateral held by the Agent.
SECTION 5.07 MAINTENANCE OF CONCENTRATION ACCOUNT. Continue to maintain
with the Agent an account or accounts to be used by the Borrower and the
Guarantors as their principal concentration account for day-to-day operations
conducted by the Borrower and the Guarantors.
SECTION 5.08 BORROWING BASE CERTIFICATE. Furnish to the Agent as soon as
available and in any event (a) prior to the making of the initial Loans or the
issuance of the initial Letter of Credit and thereafter on or before Thursday of
each week, a weekly Borrowing Base Certificate, which weekly Borrowing Base
Certificate shall reflect (i) the accounts receivable updated as of the last day
of the immediately preceding week (and in the case of the first Borrowing Base
Certificate so delivered, as of the Filing Date) and (ii) Inventory, as of the
end of the immediately preceding month, which shall be updated as of the
fifteenth (15th) day of each month, with supporting documentation to be received
no later than one Business Day thereafter (including, without limitation, the
documentation described on Schedule 1 to Exhibit E); (b) if requested by the
Agent at any other time when the Agent reasonably believes that the then
existing Borrowing Base Certificate is materially inaccurate, as soon as
reasonably available but in no event later than five (5) Business Days after
such request, a Borrowing Base Certificate showing the Borrowing Base as of the
date of the last Borrowing Base Certificate delivered pursuant to clause (i)
above, with supporting documentation to be received no later than one Business
Day thereafter (including, without limitation, the documentation described on
Schedule 1 to Exhibit E), and (c) such other supporting documentation and
additional reports with respect to the Borrowing Base as the Agent shall
reasonably request.
SECTION 5.09 COLLATERAL MONITORING AND REVIEW. At any time upon the
reasonable request of the Agent or the Required Lenders through the Agent,
permit the Agent or professionals (including, without limitation, internal and
third party consultants, accountants and appraisers) retained by the Agent or
its professionals to conduct evaluations and appraisals of (i) the Borrower's
practices in the computation of the Borrowing Base and (ii) the assets included
in the Borrowing Base, and pay the reasonable fees and expenses in connection
therewith (including, without limitation, the reasonable and customary fees and
expenses associated with the Agent's Collateral Agent Services Group as set
forth in the Fee Letter referred to in Section 2.19). In connection with any
collateral monitoring or review and appraisal relating to the computation of the
Borrowing Base, the Borrower shall make such adjustments to the Borrowing Base
as the Agent shall reasonably require based upon the terms of this Agreement and
results of such collateral monitoring, review or appraisal.
SECTION 5.10 BUSINESS PLAN. Make its senior officers available to
discuss the Borrower's business plans, consolidated and by division (a copy of
which has heretofore been delivered to the Agent and the Lenders in accordance
with Section 4.01(i)), with the Agent and/or the Lenders upon the Agent's
reasonable request.
47
SECTION 6. NEGATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.03(b)) or any amount shall remain outstanding or
unpaid under this Agreement, unless the Required Lenders shall otherwise consent
in writing, the Borrower and each of the Guarantors will not (and will not apply
to the Bankruptcy Court for authority to):
SECTION 6.01 LIENS. Incur, create, assume or suffer to exist any Lien on
any asset of the Borrower or the Guarantors, now owned or hereafter acquired by
the Borrower or any of such Guarantors, other than (i) Liens which were existing
on the Filing Date as reflected on Schedule 3.06 hereto and Liens granted
pursuant to the Existing Agreement; (ii) Liens in favor of the Existing Lenders
as adequate protection granted pursuant to the Orders, which Liens are junior to
the Liens contemplated hereby in favor of the Agent and the Lenders, PROVIDED
that the Interim Order and the Final Order provide that the holder of such
junior Liens shall not be permitted to take any action to foreclose with respect
to such junior Liens so long as any amounts shall remain outstanding hereunder
or any Commitment shall be in effect; (iii) Permitted Liens; (iv) Liens in favor
of the Agent and the Lenders; and (v) Liens securing purchase money Indebtedness
or Capitalized Leases permitted by Section 6.03(iv).
SECTION 6.02 MERGER, ETC. Consolidate or merge with or into another
Person (except that any Guarantor may merge or consolidate with any other
Guarantor).
SECTION 6.03 INDEBTEDNESS. Contract, create, incur, assume or suffer to
exist any Indebtedness, except for (i) Indebtedness under the Loan Documents;
(ii) Indebtedness incurred prior to the Filing Date (including existing
Capitalized Leases); (iii) intercompany Indebtedness between the Borrower and
the Guarantors, (iv) Indebtedness incurred subsequent to the Filing Date secured
by purchase money Liens or Capitalized Leases to the extent permitted by Section
6.04 in an aggregate amount not to exceed $5,000,000; (v) Indebtedness arising
from Investments among the Borrower, the Guarantors and foreign subsidiaries
that are permitted hereunder; and (vi) Indebtedness owed to JPMorgan Chase or
any of its banking Affiliates in respect of any overdrafts and related
liabilities arising from treasury, depository and cash management services or in
connection with any automated clearing house transfers of funds.
SECTION 6.04 CAPITAL EXPENDITURES.
(a) Make Capital Expenditures of the Borrower and the Guarantors for
each fiscal quarter ending on the date listed below in an aggregate amount in
excess of the amount listed below opposite such date, PROVIDED that if the
amount of the actual Capital Expenditures that are made during any fiscal
quarter is less than such amount, 50% of the unused portion thereof may be
carried forward to and made only during the immediately following fiscal
quarter:
Fiscal Quarter Ending Capital Expenditure
--------------------- -------------------
June 29, 2002 $2,100,000
September 28, 2002 $2,800,000
48
December 28, 2002 $3,500,000
March 30, 2003 $3,300,000
(b) Make Capital Expenditures of the Borrower and its Subsidiaries
taken as a whole for each fiscal quarter ending on the date
listed below in an aggregate amount in excess of the amount
listed below opposite such date, PROVIDED that if the amount of
the actual Capital Expenditures that are made during any fiscal
quarter is less than such amount, 50% of the unused portion
thereof may be carried forward to and made only during the
immediately following fiscal quarter:
Fiscal Quarter Ending Capital Expenditure
--------------------- -------------------
June 29, 2002 $ 8,800,000
September 28, 2002 $10,000,000
December 28, 2002 $10,000,000
March 30, 2003 $10,000,000
SECTION 6.05 EBITDA.
(a) Permit cumulative EBITDA for the Borrower and the Guarantors for
each period beginning on May 1, 2002 and ending on the last day of each fiscal
month set forth below to be less than the amount appearing opposite such month:
Period Ending EBITDA
-------------- -----------
May 2002 $ 650,000
June 2002 $ 1,350,000
July 2002 $ 2,500,000
August 2002 $ 3,500,000
September 2002 $ 4,300,000
October 2002 $ 5,500,000
November 2002 $ 6,500,000
December 2002 $ 7,400,000
January 2003 $ 8,400,000
February 2003 $ 9,100,000
March 2003 $ 9,600,000
April 2003 $10,500,000
(b) Permit cumulative EBITDA for the Borrower and its Subsidiaries
taken as a whole for each period beginning on May 1, 2002 and ending on the last
day of each fiscal month set forth below to be less than the amount appearing
opposite such month:
Period Ending EBITDA
-------------- -----------
May 2002 $ 5,050,000
June 2002 $10,100,000
July 2002 $16,400,000
49
August 2002 $21,500,000
September 2002 $28,000,000
October 2002 $35,100,000
November 2002 $40,700,000
December 2002 $46,100,000
January 2003 $52,700,000
February 2003 $57,900,000
March 2003 $62,700,000
April 2003 $69,500,000
(c) Permit EBITDA of the Borrower and the Guarantors, or for the
Borrower and its Subsidiaries taken as a whole, to be negative for any fiscal
month.
SECTION 6.06 GUARANTEES AND OTHER LIABILITIES. Purchase or repurchase
(or agree, contingently or otherwise, so to do) the Indebtedness of, or assume,
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance of any obligation or capability of so
doing, or otherwise), endorse or otherwise become liable, directly or
indirectly, in connection with the obligations, stock or dividends of any
Person, except (i) for any guaranty of Indebtedness or other obligations of the
Borrower or Guarantor if such person could have incurred such Indebtedness or
obligations under this Agreement and (ii) by endorsement of negotiable
instruments for deposit or collection in the ordinary course of business.
SECTION 6.07 CHAPTER 11 CLAIMS. Incur, create, assume, suffer to exist
or permit any other Super-Priority Claim which is PARI PASSU with or senior to
the claims of the Agent and the Lenders against the Borrower and the Guarantors
hereunder, except for the Carve-Out.
SECTION 6.08 DIVIDENDS; CAPITAL STOCK. Declare or pay, directly or
indirectly, any dividends or make any other distribution or payment, whether in
cash, property, securities or a combination thereof, with respect to (whether by
reduction of capital or otherwise) any shares of capital stock (or any options,
warrants, rights or other equity securities or agreements relating to any
capital stock), or set apart any sum for the aforesaid purposes, PROVIDED that
any Guarantor may pay dividends to the Borrower and to any other Guarantor that
is its direct parent.
SECTION 6.09 TRANSACTIONS WITH AFFILIATES. Sell or transfer any property
or assets to, or otherwise engage in any other material transactions with, any
of its Affiliates (other than the Borrower and the Guarantors) or its
shareholders, except for (i) transactions that are entered into in the ordinary
course of business at prices and on terms and conditions not less favorable to
the Borrower or such Guarantor than could be obtained on an arm's-length basis
from unrelated third parties and (ii) transactions described on Schedule 6.09.
SECTION 6.10 INVESTMENTS, LOANS AND ADVANCES. Purchase, hold or acquire
any capital stock, evidences of indebtedness or other securities of, make or
permit to exist any loans or advances to, or make or permit to exist any
investment in, any other Person (all of the foregoing, "INVESTMENTS"), except
for (i) ownership by the Borrower of the capital stock of each of the
Subsidiaries listed on Schedule 3.05, (ii) Permitted Investments, (iii) advances
and loans among the Borrower and the Guarantors in the ordinary course of
business, (iv) existing
50
Investments described on Schedule 6.10 hereto, and (v) other loans and advances
to foreign subsidiaries of the Borrower in an aggregate amount not to exceed
$10,000,000 at any one time outstanding.
SECTION 6.11 DISPOSITION OF ASSETS. Sell or otherwise dispose of any
assets (including, without limitation, the capital stock of any subsidiary)
except for (i) sales of inventory, fixtures and equipment in the ordinary course
of business, (ii) dispositions of surplus, obsolete or damaged equipment no
longer used in production, (iii) sales of marketable securities held by the
Borrower at the time of the commencement of the Cases described in Schedule 6.11
hereto and (iv) sales in arm's length transactions, at fair market value and for
cash in an aggregate amount not to exceed $500,000.
SECTION 6.12 NATURE OF BUSINESS. Modify or alter in any material manner
the nature and type of its business as conducted at or prior to the Filing Date
or the manner in which such business is conducted (except as required by the
Bankruptcy Code), it being understood that asset sales permitted by Section 6.11
shall not constitute such a material modification or alteration.
SECTION 7. EVENTS OF DEFAULT
SECTION 7.01 EVENTS OF DEFAULT. In the case of the happening of any of
the following events and the continuance thereof beyond the applicable period of
grace if any (each, an "EVENT OF DEFAULT"):
(a) any material representation or warranty made by the Borrower or
any Guarantor in this Agreement or in any Loan Document or in connection with
this Agreement or the credit extensions hereunder or any material statement or
representation made in any report, financial statement, certificate or other
document furnished by the Borrower or any Guarantors to the Lenders under or in
connection with this Agreement, shall prove to have been false or misleading in
any material respect when made or delivered; or
(b) default shall be made in the payment of any (i) Fees, interest on
the Loans or other amounts payable hereunder when due (other than amounts set
forth in clause (ii) hereof), and such default shall continue unremedied for
more than two (2) Business Days or (ii) principal of the Loans or reimbursement
obligations or cash collateralization in respect of Letters of Credit, when and
as the same shall become due and payable, whether at the due date thereof
(including the Prepayment Date) or at a date fixed for prepayment thereof or by
acceleration thereof or otherwise; or
(c) default shall be made by the Borrower or any Guarantor in the due
observance or performance of any covenant, condition or agreement contained in
Section 6 hereof; or
(d) default shall be made by the Borrower or any Guarantor in the due
observance or performance of any other covenant, condition or agreement to be
observed or performed pursuant to the terms of this Agreement, any of the Orders
or any of the other Loan Documents and such default shall continue unremedied
for more than ten (10) days; or
51
(e) any of the Cases shall be dismissed or converted to a case under
Chapter 7 of the Bankruptcy Code or the Borrower or any Guarantor shall file a
motion or other pleading seeking the dismissal of any of the Cases under Section
1112 of the Bankruptcy Code or otherwise; a trustee under Chapter 7 or Chapter
11 of the Bankruptcy Code, a responsible officer or an examiner with enlarged
powers relating to the operation of the business (powers beyond those set forth
in Section 1106(a)(3) and (4) of the Bankruptcy Code) under Section 1106(b) of
the Bankruptcy Code shall be appointed in any of the Cases and the order
appointing such trustee, responsible officer or examiner shall not be reversed
or vacated within 30 days after the entry thereof; or an application shall be
filed by the Borrower or any Guarantor for the approval of any other
Super-Priority Claim (other than the Carve-Out) in any of the Cases which is
PARI PASSU with or senior to the claims of the Agent and the Lenders against the
Borrower or any Guarantor hereunder, or there shall arise or be granted any such
PARI PASSU or senior Super-Priority Claim; or
(f) the Bankruptcy Court shall enter an order or orders granting
relief from the automatic stay applicable under Section 362 of the Bankruptcy
Code to the holder or holders of any security interest to permit foreclosure (or
the granting of a deed in lieu of foreclosure or the like) on any assets of the
Borrower or any of the Guarantors which have a value in excess of $1,000,000 in
the aggregate; or
(g) a Change of Control shall occur; or
(h) the Borrower shall fail to deliver a certified Borrowing Base
Certificate when due and such default shall continue unremedied for more than
three (3) Business Days; or
(i) any material provision of any Loan Document shall, for any
reason, cease to be valid and binding on the Borrower or any of the Guarantors,
or the Borrower or any of the Guarantors shall so assert in any pleading filed
in any court; or
(j) an order of the Bankruptcy Court shall be entered reversing,
staying for a period in excess of 10 days, vacating or (without the written
consent of the Agent) otherwise amending, supplementing or modifying any of the
Orders in a manner that is adverse to the Lenders as determined by the Agent or
terminating the use of cash collateral by the Borrower or the Guarantors
pursuant to the Orders; or
(k) any judgment or order as to a post-petition liability or debt for
the payment of money in excess of $2,000,000 not covered by insurance shall be
rendered against the Borrower or any of the Guarantors and the enforcement
thereof shall not have been stayed; or
(l) any non-monetary judgment or order with respect to a
post-petition event shall be rendered against the Borrower or any of the
Guarantors which does or would reasonably be expected to (i) cause a material
adverse change in the financial condition, business, prospects, operations or
assets of the Borrower and the Guarantors taken as a whole on a consolidated
basis, (ii) have a material adverse effect on the ability of the Borrower or any
of the Guarantors to perform their respective obligations under any Loan
Document, or (iii) have a material adverse effect on the rights and remedies of
the Agent or any Lender under any Loan Document, and
52
there shall be any period of 10 consecutive days during which a stay of
enforcement of such judgment or order, by reason of a pending appeal or
otherwise, shall not be in effect; or
(m) except as permitted by the Orders or as otherwise agreed to by
the Agent, the Borrower or the Guarantors shall make any Pre-Petition Payment
other than Pre-Petition Payments authorized by the Bankruptcy Court (x) in
accordance with "first day" orders reasonably satisfactory to the Agent
(including not in excess of $10,000,000 in respect of certain critical vendors
and service providers), (y) in connection with the assumption of executory
contracts and unexpired leases and (z) in respect of accrued payroll and related
expenses and employee benefits as of the Filing Date;
(n) any Termination Event described in clauses (iii) or (iv) of the
definition of such term shall have occurred and shall continue unremedied for
more than 10 days and the sum (determined as of the date of occurrence of such
Termination Event) of the Insufficiency of the Plan in respect of which such
Termination Event shall have occurred and be continuing and the Insufficiency of
any and all other Plans with respect to which such a Termination Event
(described in such clauses (iii) or (iv)) shall have occurred and then exist is
equal to or greater than $5,000,000; or
(o) (i) the Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor or trustee of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan, (ii) the Borrower or such ERISA
Affiliate does not have reasonable grounds, in the opinion of the Agent, to
contest such Withdrawal Liability and is not in fact contesting such Withdrawal
Liability in a timely and appropriate manner, and (iii) the amount of such
Withdrawal Liability specified in such notice, when aggregated with all other
amounts required to be paid to Multiemployer Plans in connection with Withdrawal
Liabilities (determined as of the date of such notification), exceeds $5,000,000
allocable to post-petition obligations or requires payments exceeding $500,000
per annum in excess of the annual payments made with respect to such
Multiemployer Plans by the Borrower or such ERISA Affiliate for the plan year
immediately preceding the plan year in which such notification is received; or
(p) the Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and its ERISA Affiliates to all Multiemployer
Plans that are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the plan
years that include the date hereof by an amount exceeding $5,000,000; or
(q) the Borrower or any ERISA Affiliate shall have committed a
failure described in Section 302(f)(1) of ERISA (other than the failure to make
any contribution accrued and unpaid as of the Filing Date) and the amount
determined under Section 302(f)(3) of ERISA is equal to or greater than
$5,000,000; or
(r) it shall be determined (whether by the Bankruptcy Court or by any
other judicial or administrative forum) that the Borrower or any Guarantor is
liable for the payment of
53
claims arising out of any failure to comply (or to have complied) with
applicable environmental laws or regulations the payment of which will have a
material adverse effect on the financial condition, business, properties,
operations, assets or prospects of the Borrower and the Guarantors, taken as a
whole, and the enforcement thereof shall not have been stayed;
then, and in every such event and at any time thereafter during the continuance
of such event, and without further order of or application to the Bankruptcy
Court, the Agent may, and at the request of the Required Lenders, shall, by
notice to the Borrower (with a copy to counsel for the Official Creditors'
Committee appointed in the Cases, to counsel for the Pre-Petition Agent and to
the United States Trustee for the District of South Carolina), take one or more
of the following actions, at the same or different times (provided, that with
respect to clause (iv) below and the enforcement of Liens or other remedies with
respect to the Collateral under clause (v) below, the Agent shall provide the
Borrower (with a copy to counsel for the Official Creditors' Committee in the
Cases, to counsel for the Pre-Petition Agent and to the United States Trustee
for the District of South Carolina) with five (5) Business Days' written notice
prior to taking the action contemplated thereby and provided, further, that upon
receipt of notice referred to in the immediately preceding clause with respect
to the accounts referred to in clause (iv) below, the Borrower may continue to
make ordinary course disbursements from such accounts (other than the Letter of
Credit Account) but may not withdraw or disburse any other amounts from such
accounts): (i) terminate forthwith the Total Commitment; (ii) declare the Loans
then outstanding to be forthwith due and payable, whereupon the principal of the
Loans together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall become forthwith due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived by the Borrower and the Guarantors, anything contained herein or in any
other Loan Document to the contrary notwithstanding; (iii) require the Borrower
and the Guarantors upon demand to forthwith deposit in the Letter of Credit
Account cash in an amount which, together with any amounts then held in the
Letter of Credit Account, is equal to the sum of 105% of the then Letter of
Credit Outstandings (and to the extent the Borrower and the Guarantors shall
fail to furnish such funds as demanded by the Agent, the Agent shall be
authorized to debit the accounts of the Borrower and the Guarantors maintained
with the Agent in such amount five (5) Business Days after the giving of the
notice referred to above); (iv) set-off amounts in the Letter of Credit Account
or any other accounts maintained with the Agent and apply such amounts to the
obligations of the Borrower and the Guarantors hereunder and in the other Loan
Documents; and (v) exercise any and all remedies under the Loan Documents and
under applicable law available to the Agent and the Lenders.
SECTION 8. THE AGENT
SECTION 8.01 ADMINISTRATION BY AGENT. The general administration of
the Loan Documents shall be by the Agent. Each Lender hereby irrevocably
authorizes the Agent, at its discretion, to take or refrain from taking such
actions as agent on its behalf and to exercise or refrain from exercising such
powers under the Loan Documents as are delegated by the terms hereof or thereof,
as appropriate, together with all powers reasonably incidental thereto
(including the release of Collateral in connection with any transaction that is
expressly permitted by the Loan Documents). The Agent shall have no duties or
responsibilities except as set forth in this Agreement and the remaining Loan
Documents.
54
SECTION 8.02 ADVANCES AND PAYMENTS.
(a) On the date of each Loan, the Agent shall be authorized (but not
obligated) to advance, for the account of each of the Lenders, the amount of the
Loan to be made by it in accordance with its Commitment hereunder. Should the
Agent do so, each of the Lenders agrees forthwith to reimburse the Agent in
immediately available funds for the amount so advanced on its behalf by the
Agent, together with interest at the Federal Funds Effective Rate if not so
reimbursed on the date due from and including such date but not including the
date of reimbursement.
(b) Any amounts received by the Agent in connection with this
Agreement (other than amounts to which the Agent is entitled pursuant to
Sections 2.19, 8.06, 10.05 and 10.06), the application of which is not otherwise
provided for in this Agreement shall be applied, first, in accordance with each
Lender's Commitment Percentage to pay accrued but unpaid Commitment Fees or
Letter of Credit Fees, and second, in accordance with each Lender's Commitment
Percentage to pay accrued but unpaid interest and the principal balance
outstanding and all unreimbursed Letter of Credit drawings. All amounts to be
paid to a Lender by the Agent shall be credited to that Lender, after collection
by the Agent, in immediately available funds either by wire transfer or deposit
in that Lender's correspondent account with the Agent, as such Lender and the
Agent shall from time to time agree.
SECTION 8.03 SHARING OF SETOFFS. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrower, including, but not limited to, a secured claim under Section 506
of the Bankruptcy Code or other security or interest arising from, or in lieu
of, such secured claim and received by such Lender under any applicable
bankruptcy, insolvency or other similar law, or otherwise, obtain payment in
respect of its Loans as a result of which the unpaid portion of its Loans is
proportionately less than the unpaid portion of the Loans of any other Lender
(a) it shall promptly purchase at par (and shall be deemed to have thereupon
purchased) from such other Lender a participation in the Loans of such other
Lender, so that the aggregate unpaid principal amount of each Lender's Loans and
its participation in Loans of the other Lenders shall be in the same proportion
to the aggregate unpaid principal amount of all Loans then outstanding as the
principal amount of its Loans prior to the obtaining of such payment was to the
principal amount of all Loans outstanding prior to the obtaining of such payment
and (b) such other adjustments shall be made from time to time as shall be
equitable to ensure that the Lenders share such payment pro-rata, provided that
if any such non-pro-rata payment is thereafter recovered or otherwise set aside
such purchase of participations shall be rescinded (without interest). The
Borrower expressly consents to the foregoing arrangements and agrees that any
Lender holding (or deemed to be holding) a participation in a Loan may exercise
any and all rights of banker's lien, setoff (in each case, subject to the same
notice requirements as pertain to clause (iv) of the remedial provisions of
Section 7.01) or counterclaim with respect to any and all moneys owing by the
Borrower to such Lender as fully as if such Lender held a Note and was the
original obligee thereon, in the amount of such participation.
SECTION 8.04 AGREEMENT OF REQUIRED LENDERS. Upon any occasion requiring
or permitting an approval, consent, waiver, election or other action on the part
of the Required Lenders, action shall be taken by the Agent for and on behalf or
for the benefit of all Lenders
55
upon the direction of the Required Lenders, and any such action shall be binding
on all Lenders. No amendment, modification, consent, or waiver shall be
effective except in accordance with the provisions of Section 10.10.
SECTION 8.05 LIABILITY OF AGENT.
(a) The Agent when acting on behalf of the Lenders, may execute any
of its respective duties under this Agreement by or through any of its
respective officers, agents, and employees, and neither the Agent nor its
directors, officers, agents, employees or Affiliates shall be liable to the
Lenders or any of them for any action taken or omitted to be taken in good
faith, or be responsible to the Lenders or to any of them for the consequences
of any oversight or error of judgment, or for any loss, unless the same shall
happen through its gross negligence or willful misconduct. The Agent and its
respective directors, officers, agents, employees and Affiliates shall in no
event be liable to the Lenders or to any of them for any action taken or omitted
to be taken by them pursuant to instructions received by them from the Required
Lenders or in reliance upon the advice of counsel selected by it. Without
limiting the foregoing, neither the Agent, nor any of its respective directors,
officers, employees, agents or Affiliates shall be responsible to any Lender for
the due execution, validity, genuineness, effectiveness, sufficiency, or
enforceability of, or for any statement, warranty, or representation in, this
Agreement, any Loan Document or any related agreement, document or order, or
shall be required to ascertain or to make any inquiry concerning the performance
or observance by the Borrower of any of the terms, conditions, covenants, or
agreements of this Agreement or any of the Loan Documents.
(b) Neither the Agent nor any of its respective directors, officers,
employees, agents or Affiliates shall have any responsibility to the Borrower or
the Guarantors on account of the failure or delay in performance or breach by
any Lender or by the Borrower or the Guarantors of any of their respective
obligations under this Agreement or any of the Loan Documents or in connection
herewith or therewith.
(c) The Agent, in its capacity as Agent hereunder, shall be entitled
to rely on any communication, instrument, or document reasonably believed by
such person to be genuine or correct and to have been signed or sent by a person
or persons believed by such person to be the proper person or persons, and such
person shall be entitled to rely on advice of legal counsel, independent public
accountants, and other professional advisers and experts selected by such
person.
SECTION 8.06 REIMBURSEMENT AND INDEMNIFICATION. Each Lender agrees (i)
to reimburse the Agent for such Lender's Commitment Percentage of any expenses
and fees incurred for the benefit of the Lenders under this Agreement and any of
the Loan Documents, including, without limitation, counsel fees and compensation
of agents and employees paid for services rendered on behalf of the Lenders, and
any other expense incurred in connection with the operations or enforcement
thereof, not reimbursed by the Borrower or the Guarantors and (ii) to indemnify
and hold harmless the Agent and any of its directors, officers, employees,
agents or Affiliates, on demand, in the amount of its proportionate share, from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses, or disbursements of any kind or
nature whatsoever which may be imposed on, incurred by, or asserted against it
or any of them in any way relating to or arising out of this Agreement or any
56
of the Loan Documents or any action taken or omitted by it or any of them under
this Agreement or any of the Loan Documents to the extent not reimbursed by the
Borrower or the Guarantors (except such as shall result from their respective
gross negligence or willful misconduct).
SECTION 8.07 RIGHTS OF AGENT. It is understood and agreed that JPMorgan
Chase shall have the same rights and powers hereunder (including the right to
give such instructions) as the other Lenders and may exercise such rights and
powers, as well as its rights and powers under other agreements and instruments
to which it is or may be party, and engage in other transactions with the
Borrower or any Guarantor, as though it were not the Agent of the Lenders under
this Agreement.
SECTION 8.08 INDEPENDENT LENDERS. Each Lender acknowledges that it has
decided to enter into this Agreement and to make the Loans hereunder based on
its own analysis of the transactions contemplated hereby and of the
creditworthiness of the Borrower and the Guarantors and agrees that the Agent
shall bear no responsibility therefor.
SECTION 8.09 NOTICE OF TRANSFER. The Agent may deem and treat a Lender
party to this Agreement as the owner of such Lender's portion of the Loans for
all purposes, unless and until a written notice of the assignment or transfer
thereof executed by such Lender shall have been received by the Agent.
SECTION 8.10 SUCCESSOR AGENT. The Agent may resign at any time by giving
written notice thereof to the Lenders and the Borrower. Upon any such
resignation, the Required Lenders shall have the right to appoint a successor
Agent, which shall be reasonably satisfactory to the Borrower. If no successor
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment, within 30 days after the retiring Agent's giving of
notice of resignation, the retiring Agent may, on behalf of the Lenders, appoint
a successor Agent, which shall be a commercial bank organized under the laws of
the United States of America or of any State thereof and having a combined
capital and surplus of a least $100,000,000, which shall be reasonably
satisfactory to the Borrower. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Agent, and the retiring Agent shall be discharged from its duties and
obligations under this Agreement. After any retiring Agent's resignation
hereunder as 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 Agent under
this Agreement.
SECTION 9. GUARANTY
SECTION 9.01 GUARANTY.
(a) Each of the Guarantors unconditionally and irrevocably guarantees
the due and punctual payment by the Borrower of the Obligations. Each of the
Guarantors further agrees that the Obligations may be extended or renewed, in
whole or in part, without notice to or further assent from it, and it will
remain bound upon this guaranty notwithstanding any extension or renewal of any
of the Obligations. The Obligations of the Guarantors shall be joint and
several.
57
(b) Each of the Guarantors waives presentation to, demand for payment
from and protest to the Borrower or any other Guarantor, and also waives notice
of protest for nonpayment. The Obligations of the Guarantors hereunder shall not
be affected by (i) the failure of the Agent or a Lender to assert any claim or
demand or to enforce any right or remedy against the Borrower or any other
Guarantor under the provisions of this Agreement or any other Loan Document or
otherwise; (ii) any extension or renewal of any provision hereof or thereof;
(iii) any rescission, waiver, compromise, acceleration, amendment or
modification of any of the terms or provisions of any of the Loan Documents;
(iv) the release, exchange, waiver or foreclosure of any security held by the
Agent for the Obligations or any of them; (v) the failure of the Agent or a
Lender to exercise any right or remedy against any other Guarantor; or (vi) the
release or substitution of any Guarantor or any other Guarantor.
(c) Each of the Guarantors further agrees that this guaranty
constitutes a guaranty of payment when due and not just of collection, and
waives any right to require that any resort be had by the Agent or a Lender to
any security held for payment of the Obligations or to any balance of any
deposit, account or credit on the books of the Agent or a Lender in favor of the
Borrower or any other Guarantor, or to any other Person.
(d) Each of the Guarantors hereby waives any defense that it might
have based on a failure to remain informed of the financial condition of the
Borrower and of any other Guarantor and any circumstances affecting the ability
of the Borrower to perform under this Agreement.
(e) Each Guarantor's guaranty shall not be affected by the
genuineness, validity, regularity or enforceability of the Obligations or any
other instrument evidencing any Obligations, or by the existence, validity,
enforceability, perfection, or extent of any collateral therefor or by any other
circumstance relating to the Obligations which might otherwise constitute a
defense to this Guaranty. Neither of the Agent, nor any of the Lenders makes any
representation or warranty in respect to any such circumstances or shall have
any duty or responsibility whatsoever to any Guarantor in respect of the
management and maintenance of the Obligations.
(f) Subject to the provisions of Section 7.01, upon the Obligations
becoming due and payable (by acceleration or otherwise), the Lenders shall be
entitled to immediate payment of such Obligations by the Guarantors upon written
demand by the Agent, without further application to or order of the Bankruptcy
Court.
SECTION 9.02 NO IMPAIRMENT OF GUARANTY. The obligations of the
Guarantors hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including, without limitation, any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense or set-off, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations. Without limiting the generality of the foregoing, the obligations
of the Guarantors hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Agent or a Lender to assert any claim or demand
or to enforce any remedy under this Agreement or any other agreement, by any
waiver or modification of any provision thereof, by any default, failure or
delay, willful or otherwise, in the performance of the Obligations, or by any
other act or thing
58
or omission or delay to do any other act or thing which may or might in any
manner or to any extent vary the risk of the Guarantors or would otherwise
operate as a discharge of the Guarantors as a matter of law, unless and until
the Obligations are paid in full.
SECTION 9.03 SUBROGATION. Upon payment by any Guarantor of any sums to
the Agent or a Lender hereunder, all rights of such Guarantor against the
Borrower arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinate and junior in right of payment
to the prior final and indefeasible payment in full of all the Obligations. If
any amount shall be paid to such Guarantor for the account of the Borrower, such
amount shall be held in trust for the benefit of the Agent and the Lenders and
shall forthwith be paid to the Agent and the Lenders to be credited and applied
to the Obligations, whether matured or unmatured.
SECTION 10. MISCELLANEOUS
SECTION 10.01 NOTICES. Notices and other communications provided for
herein shall be in writing (including facsimile communication) and shall be
mailed, transmitted by facsimile or delivered to the Borrower or any Guarantor
at 0000 Xxxxxxx Xxxx, Xxxxx Xxxxxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Xxx
Xxxx and to a Lender or the Agent to it at its address set forth on Annex A, or
such other address as such party may from time to time designate by giving
written notice to the other parties hereunder. All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the fifth Business Day
after the date when sent by registered or certified mail, postage prepaid,
return receipt requested, if by mail; or when receipt is acknowledged, if by any
facsimile equipment of the sender; in each case addressed to such party as
provided in this Section 10.01 or in accordance with the latest unrevoked
written direction from such party; PROVIDED, HOWEVER, that, in the case of
notices to the Agent, notices pursuant to the preceding sentence with respect to
change of address and pursuant to Section 2 shall be effective only when
received by the Agent.
SECTION 10.02 SURVIVAL OF AGREEMENT, REPRESENTATIONS AND WARRANTIES, ETC.
All warranties, representations and covenants made by the Borrower or any
Guarantor herein or in any certificate or other instrument delivered by it or on
its behalf in connection with this Agreement shall be considered to have been
relied upon by the Lenders and shall survive the making of the Loans herein
contemplated regardless of any investigation made by any Lender or on its behalf
and shall continue in full force and effect so long as any amount due or to
become due hereunder is outstanding and unpaid and so long as the Commitments
have not been terminated. All statements in any such certificate or other
instrument shall constitute representations and warranties by the Borrower and
the Guarantors hereunder with respect to the Borrower.
SECTION 10.03 SUCCESSORS AND ASSIGNS.
(a) This Agreement shall be binding upon and inure to the benefit of
the Borrower, the Agent and the Lenders and their respective successors and
assigns. Neither the Borrower nor any of the Guarantors may assign or transfer
any of their rights or obligations hereunder without the prior written consent
of all of the Lenders. Each Lender may sell
59
participations to any Person in all or part of any Loan, or all or part of its
Commitment, in which event, without limiting the foregoing, the provisions of
Section 2.15 shall inure to the benefit of each purchaser of a participation
(provided that such participant shall look solely to the seller of such
participation for such benefits and the Borrower's and the Guarantors'
liability, if any, under Sections 2.15 and 2.18 shall not be increased as a
result of the sale of any such participation) and the pro rata treatment of
payments, as described in Section 2.17, shall be determined as if such Lender
had not sold such participation. In the event any Lender shall sell any
participation, such Lender shall retain the sole right and responsibility to
enforce the obligations of the Borrower and each of the Guarantors relating to
the Loans, including, without limitation, the right to approve any amendment,
modification or waiver of any provision of this Agreement (provided that such
Lender may grant its participant the right to consent to such Lender's execution
of amendments, modifications or waivers which (i) reduce any Fees payable
hereunder to the Lenders, (ii) reduce the amount of any scheduled principal
payment on any Loan or reduce the principal amount of any Loan or the rate of
interest payable hereunder or (iii) extend the maturity of the Borrower's
obligations hereunder). The sale of any such participation shall not alter the
rights and obligations of the Lender selling such participation hereunder with
respect to the Borrower.
(b) Each Lender may assign to one or more Lenders or Eligible
Assignees all or a portion of its interests, rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment and
the same portion of the related Loans at the time owing to it), PROVIDED,
HOWEVER, that (i) other than in the case of an assignment to a Lender Affiliate
of such assignor Lender, or to another Lender, the Agent and the Fronting Bank
must give their respective prior written consent to such assignment, which
consent will not be unreasonably withheld, (ii) the aggregate amount of the
Commitment and/or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Acceptance with respect to such
assignment is delivered to the Agent) shall, unless otherwise agreed to in
writing by the Agent, in no event be less than $1,000,000 or the remaining
portion of such Lender's Commitment and/or Loans, if less and (iii) the parties
to each such assignment shall execute and deliver to the Agent, for its
acceptance and recording in the Register (as defined below), an Assignment and
Acceptance with blanks appropriately completed, together with a processing and
recordation fee of $3,500 (for which the Borrower shall have no liability). Upon
such execution, delivery, acceptance and recording, from and after the effective
date specified in each Assignment and Acceptance, which effective date shall be
within ten Business Days after the execution thereof (unless otherwise agreed to
in writing by the Agent), (A) 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 and (B) the 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 Lender shall cease to be a party
hereto).
(c) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, such Lender
assignor makes no representation or warranty and assumes no responsibility with
60
respect to any statements, warranties or representations made in or in
connection with this Agreement or any of the other Loan Documents or the
execution, legality, validity, enforceability, genuineness, sufficiency or value
of this Agreement or any of the other Loan Documents; (ii) such Lender assignor
makes no representation or warranty and assumes no responsibility with respect
to the financial condition of the Borrower or any Guarantor or the performance
or observance by the Borrower or any Guarantor of any of its obligations under
this Agreement or any of the other Loan Documents or any other instrument or
document furnished pursuant hereto; (iii) such assignee confirms that it has
received a copy of this Agreement and the other Loan Documents, together with
copies of the financial statements referred to in Section 3.04 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance upon the Agent, such Lender
assignor 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 this Agreement; (v) such assignee appoints and
authorizes the Agent to take such action as agent on its behalf and to exercise
such powers under this Agreement as are delegated to the Agent by the terms
thereto, together with such powers as are reasonably incidental hereof; and (vi)
such assignee agrees that it will perform in accordance with their terms all
obligations that by the terms of this Agreement are required to be performed by
it as a Lender.
(d) The Agent shall maintain at its office a copy of each Assignment
and Acceptance delivered to it and a register for the recordation of the names
and addresses of the Lenders and the Commitments of, and principal amount of the
Loans owing to, each Lender from time to time (the "REGISTER"). The entries in
the Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Guarantors, the Agent and the Lenders shall treat each Person the
name of which is recorded in the Register as a Lender hereunder for all purposes
of this Agreement. The Register shall be available for inspection by the
Borrower or any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and the assignee thereunder together with the fee payable in
respect thereto, the Agent shall, if such Assignment and Acceptance has been
completed with blanks appropriately filled and consented to by the Agent and the
Fronting Bank (to the extent such consent is required hereunder), (i) accept
such Assignment and Acceptance, (ii) record the information contained therein in
the Register and (iii) give prompt written notice thereof to the Borrower
(together with a copy thereof). No assignment shall be effective for purposes of
this Agreement unless it has been recorded in the Register as provided in this
paragraph.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
10.03, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower or any of the Guarantors
furnished to such Lender by or on behalf of the Borrower or any of the
Guarantors; provided that prior to any such disclosure, each such assignee or
participant or proposed assignee or participant shall agree in writing to be
bound by the provisions of Section 10.04.
61
(g) The Borrower hereby agrees, to the extent set forth in the
Commitment Letter, to actively assist and cooperate with the Agent in the
Agent's efforts to sell participations herein (as described in Section 10.03(a))
and assign to one or more Lenders or Eligible Assignees a portion of its
interests, rights and obligations under this Agreement (as set forth in Section
10.03(b)).
SECTION 10.04 CONFIDENTIALITY. Each Lender agrees to keep any information
delivered or made available by the Borrower or any of the Guarantors to it
confidential from anyone other than persons employed or retained by such Lender
who are or are expected to become engaged in evaluating, approving, structuring
or administering the Loans; provided that nothing herein shall prevent any
Lender from disclosing such information (i) to any of its Affiliates or to any
other Lender, provided such Affiliate agrees to keep such information
confidential to the same extent required by the Lenders hereunder, (ii) upon the
order of any court or administrative agency, (iii) upon the request or demand of
any regulatory agency or authority, (iv) which has been publicly disclosed other
than as a result of a disclosure by the Agent or any Lender which is not
permitted by this Agreement, (v) in connection with any litigation to which the
Agent, any Lender, or their respective Affiliates may be a party to the extent
reasonably required, (vi) to the extent reasonably required in connection with
the exercise of any remedy hereunder, (vii) to such Lender's legal counsel and
independent auditors, and (viii) to any actual or proposed participant or
assignee of all or part of its rights hereunder subject to the proviso in
Section 10.03(f). Each Lender shall use reasonable efforts to notify the
Borrower of any required disclosure under clauses (ii) and (v) of this Section.
SECTION 10.05 EXPENSES. Whether or not the transactions hereby
contemplated shall be consummated, the Borrower and the Guarantors agree to pay
all reasonable and documented out-of-pocket expenses incurred by the Agent
(including but not limited to the reasonable fees and disbursements of Xxxxxx,
Xxxxx & Xxxxxxx LLP, special counsel for the Agent, any other counsel that the
Agent shall retain and any internal or third-party appraisers, consultants and
accountants advising the Agent and X.X. Xxxxxx Securities Inc.) in connection
with the preparation, execution, delivery and administration of this Agreement
and the other Loan Documents, the making of the Loans and the issuance of the
Letters of Credit, the perfection of the Liens contemplated hereby, the
syndication of the transactions contemplated hereby, the reasonable and
customary costs, fees and expenses (including, without limitation, internally
allocated charges and expenses relating to the Agent's initial and ongoing
Borrowing Base examinations as set forth in the Fee Letter referred to in
Section 2.19) of the Agent in connection with its monthly and other periodic
field examinations, monitoring of assets (including reasonable and customary
internal collateral monitoring fees as set forth in the Fee Letter referred to
in Section 2.19) and publicity expenses, and, following the occurrence of an
Event of Default, all reasonable out-of-pocket expenses incurred by the Lenders
and the Agent in the enforcement or protection of the rights of any one or more
of the Lenders or the Agent in connection with this Agreement or the other Loan
Documents, including but not limited to the reasonable fees and disbursements of
any counsel for the Lenders or the Agent. Such payments shall be made on the
date of the Interim Order and thereafter on demand upon delivery of a statement
setting forth such costs and expenses. Whether or not the transactions hereby
contemplated shall be consummated, the Borrower and the Guarantors agree to
reimburse the Agent and X.X. Xxxxxx Securities Inc. for the expenses set forth
in the Commitment Letter and the reimbursement provisions thereof are hereby
incorporated herein by reference. The
62
obligations of the Borrower and the Guarantors under this Section shall survive
the termination of this Agreement and/or the payment of the Loans.
SECTION 10.06 INDEMNITY. The Borrower and each of the Guarantors agree to
indemnify and hold harmless the Agent, X.X. Xxxxxx Securities Inc. and the
Lenders and their directors, officers, employees, agents and Affiliates (each an
"INDEMNIFIED PARTY") from and against any and all expenses, losses, claims,
damages and liabilities incurred by such Indemnified Party arising out of claims
made by any Person in any way relating to the transactions contemplated hereby,
but excluding therefrom all expenses, losses, claims, damages, and liabilities
to the extent that they are determined by the final judgment of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnified Party. The obligations of the Borrower and the
Guarantors under this Section shall survive the termination of this Agreement
and/or the payment of the Loans.
SECTION 10.07 CHOICE OF LAW. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS
SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS
OF THE STATE OF NEW YORK AND (TO THE EXTENT APPLICABLE) THE BANKRUPTCY CODE.
SECTION 10.08 NO WAIVER. No failure on the part of the Agent or any of
the Lenders to exercise, and no delay in exercising, any right, power or remedy
hereunder or any of the other Loan Documents shall operate as a waiver thereof,
nor shall any single or partial exercise of any such right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All remedies hereunder are cumulative and are not
exclusive of any other remedies provided by law.
SECTION 10.09 EXTENSION OF MATURITY. Should any payment of principal of
or interest or any other amount due hereunder become due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and, in the case of principal, interest shall be payable
thereon at the rate herein specified during such extension.
SECTION 10.10 AMENDMENTS, ETC.
(a) No modification, amendment or waiver of any provision of this
Agreement or the Security and Pledge Agreement, and no consent to any departure
by the Borrower or any Guarantor therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required Lenders, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given; PROVIDED, HOWEVER, that no such modification or
amendment shall without the written consent of (1) the Super-majority Lenders
release any of the Liens granted to the Agent hereunder, under the Orders or
under any other Loan Document, or release any of the Guarantors, (2) the Lender
affected thereby (x) increase the Commitment of a Lender (it being understood
that a waiver of an Event of Default shall not constitute an increase in the
Commitment of a Lender), or (y) reduce the principal amount of any Loan or the
rate of interest payable thereon, or extend any date for the payment of interest
hereunder or reduce any Fees payable hereunder or extend the final maturity of
the Borrower's obligations hereunder or (3) all of the Lenders (i) amend or
modify any provision of
63
this Agreement which provides for the unanimous consent or approval of the
Lenders, (ii) amend this Section 10.10 or the definition of Required Lenders,
(iii) amend or modify the Superpriority Claim status of the Lenders contemplated
by Section 2.23 or (iv) release all or substantially all of the Liens granted to
the Agent hereunder, under the Orders or under any other Loan Document, or
release all or substantially all of the Guarantors. No such amendment or
modification may adversely affect the rights and obligations of the Agent or any
Fronting Bank hereunder or JPMorgan Chase Bank in the capacity referred to in
Section 6.03(vi) without its prior written consent. No notice to or demand on
the Borrower or any Guarantor shall entitle the Borrower or any Guarantor to any
other or further notice or demand in the same, similar or other circumstances.
Each assignee under Section 10.03(b) shall be bound by any amendment,
modification, waiver, or consent authorized as provided herein, and any consent
by a Lender shall bind any Person subsequently acquiring an interest on the
Loans held by such Lender. No amendment to this Agreement shall be effective
against the Borrower or any Guarantor unless signed by the Borrower or such
Guarantor, as the case may be.
(b) Notwithstanding anything to the contrary contained in Section
10.10(a), in the event that the Borrower requests that this Agreement be
modified or amended in a manner which would require the unanimous consent of all
of the Lenders and such modification or amendment is agreed to by the
Super-majority Lenders (as hereinafter defined), then with the consent of the
Borrower and the Super-majority Lenders, the Borrower and the Super-majority
Lenders shall be permitted to amend the Agreement without the consent of the
Lender or Lenders which did not agree to the modification or amendment requested
by the Borrower (such Lender or Lenders, collectively the "MINORITY LENDERS") to
provide for (w) the termination of the Commitment of each of the Minority
Lenders, (x) the addition to this Agreement of one or more other financial
institutions (each of which shall be an Eligible Assignee), or an increase in
the Commitment of one or more of the Super-majority Lenders, so that the Total
Commitment after giving effect to such amendment shall be in the same amount as
the Total Commitment immediately before giving effect to such amendment, (y) if
any Loans are outstanding at the time of such amendment, the making of such
additional Loans by such new financial institutions or Super-majority Lender or
Lenders, as the case may be, as may be necessary to repay in full the
outstanding Loans of the Minority Lenders immediately before giving effect to
such amendment and (z) such other modifications to this Agreement as may be
appropriate. As used herein, the term "SUPER-MAJORITY LENDERS" shall mean, at
any time, Lenders holding Loans representing at least 66-2/3% of the aggregate
principal amount of the Loans outstanding, or if no Loans are outstanding,
Lenders having Commitments representing at least 66-2/3% of the Total
Commitment.
SECTION 10.11 SEVERABILITY. Any provision of this Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 10.12 HEADINGS. Section headings used herein are for convenience
only and are not to affect the construction of or be taken into consideration in
interpreting this Agreement.
64
SECTION 10.13 EXECUTION IN COUNTERPARTS. This Agreement may be executed
in any number of counterparts, each of which shall constitute an original, but
all of which taken together shall constitute one and the same instrument.
SECTION 10.14 PRIOR AGREEMENTS. This Agreement represents the entire
agreement of the parties with regard to the subject matter hereof and the terms
of any letters and other documentation entered into between the Borrower or a
Guarantor and any Lender or the Agent prior to the execution of this Agreement
which relate to Loans to be made hereunder shall be replaced by the terms of
this Agreement (except as otherwise expressly provided herein with respect to
the Commitment Letter and the fee letter referred to therein, including without
limitation the Borrower's agreements to actively assist the Agent in the
syndication of the transactions contemplated hereby referred to in Section
10.03(g) and with respect to interest rates and Commitment Fees and including
also the provisions of Section 2.19).
SECTION 10.15 FURTHER ASSURANCES. Whenever and so often as reasonably
requested by the Agent, the Borrower and the Guarantors will promptly execute
and deliver or cause to be executed and delivered all such other and further
instruments, documents or assurances, and promptly do or cause to be done all
such other and further things as may be necessary and reasonably required in
order to further and more fully vest in the Agent all rights, interests, powers,
benefits, privileges and advantages conferred or intended to be conferred by
this Agreement and the other Loan Documents.
SECTION 10.16 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE GUARANTORS,
THE AGENT AND EACH LENDER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY
IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO ANY OF
THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
65
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and the year first written.
BORROWER:
POLYMER GROUP, INC.
By:
------------------------------------
Name:
Title:
GUARANTORS:
PGI POLYMER, INC.
PGI EUROPE, INC.
CHICOPEE, INC.
FIBERTECH GROUP, INC.
TECHNETICS GROUP, INC.
FIBERGOL CORPORATION
FABRENE CORP.
FABRENE GROUP LLC
PNA CORP.
FNA POLYMER CORP.
FNA ACQUISITION, INC.
LORETEX CORPORATION
DOMINION TEXTILE (USA) INC.
POLY-BOND INC.
FABPRO ORIENTED POLYMERS, INC.
PRISTINE BRANDS CORPORATION
POLYIONIX SEPARATION TECHNOLOGIES, INC.
BONLAM (S.C.), INC.
By:
------------------------------------
Name:
Title:
PGI ASSET MANAGEMENT COMPANY
PGI SERVICING COMPANY
By:
------------------------------------
Name:
Title:
JPMORGAN CHASE BANK,
INDIVIDUALLY AND AS AGENT
By:
----------------------------------
Name:
Title:
GENERAL ELECTRIC CAPITAL
CORPORATION
By:
-----------------------------------
Name:
Title:
SATELLITE ASSET MANAGEMENT
By:
----------------------------------
Name:
Title:
MIDDENBANK CURACAO NV
By:
-----------------------------------
Name:
Title:
MASSACHUSETTS MUTUAL LIFE
INSURANCE COMPANY
BY: XXXXX X. XXXXXX & COMPANY INC.
By:
-----------------------------------
Name:
Title:
XXXX AND XXXXXXX XXXXX FOUNDATION
BY: XXXXX X. XXXXXX & COMPANY INC.
By:
----------------------------------
Name:
Title:
ANNEX A
to
REVOLVING
CREDIT AND GUARANTY AGREEMENT
Dated as of May 30, 2002
COMMITMENT COMMITMENT
Lender AMOUNT PERCENTAGE
------ ----------- ----------
JPMorgan Chase Bank $ 79,000,000 63.20%
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxxx X. Xxxxx
Managing Director
General Electric Capital Corporation $ 15,500,000 12.40%
00 Xxxx Xxxxx Xxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attn: Xx. Xxxxx Xxxx
Satellite Senior Income Fund, LLC $ 15,500,000 12.40%
c/o Satellite Asset Management L.P..
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xx. Xxxx Xx
Middenbank Curacao NV $ 10,000,000 8.00%
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xx. Xxxxxxx Eng
Massachusetts Mutual Life Insurance Company $ 1,000,000 0.80%
c/o Xxxxx X. Xxxxxx & Company Inc.
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxxxxx
Xxxx and Xxxxxxx Xxxxx Foundation $ 4,000,000 3.20%
c/o Xxxxx X. Xxxxxx & Company Inc.
0000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xx. Xxxxx Xxxxxxxxx
Total $ 125,000,000 100.0000%
============== ========
Exhibit A to the
Revolving
Credit and
Guaranty Agreement
FORM OF INTERIM ORDER
Exhibit B to the
Revolving
Credit and
Guaranty Agreement
FORM OF SECURITY AND PLEDGE AGREEMENT
Exhibit C to the
Revolving
Credit and
Guaranty Agreement
FORM OF OPINION OF COUNSEL
Exhibit D to the
Revolving
Credit and
Guaranty Agreement
FORM OF ASSIGNMENT AND ACCEPTANCE
Exhibit E to the
Revolving
Credit and
Guaranty Agreement
[FORM OF BORROWING BASE CERTIFICATE]
[SCHEDULE 1.01]
[EXISTING AGREEMENT]
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 3.04
Material Adverse Effect
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 3.05
Subsidiaries
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 3.06
Liens
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 3.10
Litigation
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 6.09
Transaction with Shareholders
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 6.10
Existing Investments
[TO BE SATISFACTORY TO THE AGENT]
SCHEDULE 6.11
Sale of Marketable Securities
[TO BE SATISFACTORY TO THE AGENT]
