1
Exhibit 10.10
COMPOSITE COPY
AMENDMENTS 1-9 INCLUDED
================================================================================
U.S.$125,000,000
CREDIT AGREEMENT
Dated as of August 17, 1994
Among
SIGNATURE BRANDS, INC.,
as Borrower,
------------
THE BANKS AND OTHER FINANCIAL INSTITUTIONS NAMED HEREIN,
as Banks,
---------
BANQUE NATIONALE DE PARIS, NEW YORK BRANCH,
as Issuing Bank, Swing Line Bank, Syndication Agent and Agent
-------------------------------------------------------------
and
NBD BANK,
as Documentation Agent
----------------------
================================================================================
2
TABLE OF CONTENTS
-----------------
Section Page
------- ----
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. Certain Defined Terms.......................................................... 1
SECTION 1.02. Computation of Time Periods.................................................... 22
SECTION 1.03. Accounting Terms............................................................... 22
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES AND LETTERS OF CREDIT
SECTION 2.01. The Advances................................................................... 22
SECTION 2.02. Making the Advances............................................................ 23
SECTION 2.03. Repayment...................................................................... 24
SECTION 2.04. Reduction of the Commitments................................................... 25
SECTION 2.05. Prepayments.................................................................... 26
SECTION 2.06. Interest....................................................................... 27
SECTION 2.07. Fees........................................................................... 27
SECTION 2.08. Conversion of Advances......................................................... 28
SECTION 2.09. Increased Costs, Etc........................................................... 29
SECTION 2.10. Payments and Computations...................................................... 30
SECTION 2.11. Taxes.......................................................................... 31
SECTION 2.12. Sharing of Payments, Etc....................................................... 32
SECTION 2.13. Letters of Credit.............................................................. 33
SECTION 2.14. Defaulting Lenders
SECTION 2.15. Use of Proceeds................................................................ 38
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. Conditions Precedent to Initial Borrowing...................................... 38
SECTION 3.02. Conditions Precedent to Each Borrowing......................................... 44
SECTION 3.03. Determinations Under Section 3.01.............................................. 44
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Borrower................................. 45
3
ii
Section Page
------- ----
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. Affirmative Covenants.......................................................... 50
SECTION 5.02. Negative Covenants............................................................. 54
SECTION 5.03. Reporting Requirements......................................................... 59
SECTION 5.04. Financial Covenants............................................................ 63
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. Events of Default.............................................................. 65
SECTION 6.02. Actions in Respect of Letters of Credit upon Event of Default.................. 68
ARTICLE VII
THE AGENTS
SECTION 7.01. Authorization and Action....................................................... 68
SECTION 7.02. Agents' Reliance, Etc.......................................................... 68
SECTION 7.03. The Agents and their Affiliates................................................ 69
SECTION 7.04. Lender Credit Decision......................................................... 69
SECTION 7.05. Indemnification................................................................ 69
SECTION 7.06. Successor Agents............................................................... 70
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Amendments, Etc................................................................ 71
SECTION 8.02. Notices, Etc................................................................... 72
SECTION 8.03. No Waiver; Remedies............................................................ 72
SECTION 8.04. Costs and Expenses............................................................. 72
SECTION 8.05. Right of Setoff................................................................ 73
SECTION 8.06. Binding Effect................................................................. 74
SECTION 8.07. Assignments and Participations................................................. 74
SECTION 8.08. Confidentiality................................................................ 76
SECTION 8.09. Governing Law.................................................................. 76
SECTION 8.10. No Liability of the Issuing Banks or the Existing Issuing Banks................ 76
SECTION 8.11. Execution in Counterparts...................................................... 77
SECTION 8.12. Waiver of Jury Trial........................................................... 77
4
iii
SCHEDULES
---------
Schedule I - Commitments and Applicable Lending
Offices
Schedule 2.13(a) - Existing Letters of Credit
Schedule 3.01(n)(xiii) - Consents, Etc.
Schedule 4.01(b) - Subsidiaries
Schedule 4.01(j) - Disclosed Litigation
Schedule 4.01(m) - Plans, Multiemployer Plans and
Welfare Plans
Schedule 4.01(t) - Environmental Laws, Etc.
Schedule 4.01(y) - Open years
Schedule 4.01(bb) - Investment Company, Etc.
Schedule 4.01(dd) - Surviving Indebtedness
Schedule 4.01(ee) - Real Property
Schedule 4.01(ff) - Leased Property
Schedule 4.01(gg) - Investments
Schedule 4.01(hh) - Intellectual Property
Schedule 5.01(o) - Certain Leaseholds
Schedule 5.01(p)(iii) - Mortgages
5
iv
EXHIBITS
--------
Exhibit A-1 - Form of Term Note
Exhibit A-2 - Form of Revolving Credit Note
Exhibit B - Form of Notice of Borrowing
Exhibit C - Form of Assignment and Acceptance
Exhibit D-1 - Form of Security Agreement
Exhibit D-2 - Form of Patent, Trademark and Copyright Security
Agreement
Exhibit E - Form of Brands Pledge Agreement
Exhibit F-1 - Form of Brands Guaranty
Exhibit F-2 - Form of Subsidiaries' Guaranty
Exhibit G-1 - Form of Solvency Certificate (Signature Brands,
Inc./Signature Brands USA, Inc.)
Exhibit G-2 - Form of Solvency Certificate (Mr. Coffee, inc.)
Exhibit H - Form of Solvency Letter
Exhibit I - Forms of Privity Letters
Exhibit J - Form of Borrowing Base Report
Exhibit K-1, K-2 & K-3 - Forms of Opinion of Counsel for the
Loan Parties
6
CREDIT AGREEMENT
CREDIT AGREEMENT dated as of August 17, 1994 among SIGNATURE
BRANDS, INC., an Ohio corporation ("SIGNATURE" and, prior to the Second Merger
(as hereinafter defined) or together with Mr. Coffee (as hereinafter defined)
immediately following the Second Merger, the "BORROWER"), the banks and other
financial institutions (the "BANKS") listed on the signature pages hereof,
BANQUE NATIONALE DE PARIS ("BNP"), as the Issuing Bank (as hereinafter defined),
as swing line bank (the "SWING LINE BANK"), and as agent (together with any
successors appointed pursuant to Article VII, the "AGENT") for the Lenders (as
hereinafter defined), the Issuing Bank (as hereinafter defined) and the Existing
Issuing Banks (as hereinafter defined) hereunder.
PRELIMINARY STATEMENTS:
(1) Java Acquisition Corporation, a Delaware corporation and
wholly owned Subsidiary (as hereinafter defined) of Signature ("ACQUISITION"),
was organized by Signature, a wholly owned Subsidiary of Signature Brands USA,
Inc., a Delaware corporation ("BRANDS"), to acquire control of Mr. Coffee, inc.,
a Delaware corporation ("MR. COFFEE").
(2) Pursuant to a certificate of merger to be filed with the
Secretary of State of the State of Delaware (the "FIRST MERGER CERTIFICATE") and
an Agreement and Plan of Merger dated as of May 24, 1994 (as amended,
supplemented or otherwise modified through the date hereof, the "MERGER
AGREEMENT") among Brands, Signature, Acquisition and Mr. Coffee, Acquisition
will merge with and into Mr. Coffee (the "FIRST MERGER") after which Mr. Coffee
will be the surviving corporation and a wholly owned Subsidiary of Signature
(the "SURVIVING CORPORATION").
(3) Promptly after the First Merger, pursuant to a certificate
of ownership and merger to be filed with the Secretary of State of the State of
Delaware (the "SECOND MERGER CERTIFICATE"), the Surviving Corporation will merge
with and into Signature (the "SECOND MERGER", and together with the First
Merger, the "MERGERS") after which Signature will be the surviving corporation.
(4) The Borrower has requested that, after execution and
delivery hereof, and immediately upon satisfaction of the conditions contained
herein and from time to time thereafter, the Lenders and the Issuing Bank extend
credit to the Borrower up to an aggregate of $125,000,000 at any time
outstanding in order to finance in part the Mergers, to pay transaction fees and
expenses in connection with the Mergers and the other transactions contemplated
hereby, to refinance certain existing credit facilities of Signature and Mr.
Coffee and to provide working capital and letter of credit support for the
Borrower and its Subsidiaries. The Lenders and the Issuing Bank have indicated
their willingness to agree to lend such amounts on the terms and conditions of
this Agreement.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01. CERTAIN DEFINED TERMS. As used in this
Agreement, the following terms shall have the following meanings (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined):
7
2
"ACQUISITION" has the meaning specified in the Preliminary
Statements to this Agreement.
"ADVANCE" means a Term Advance, a Revolving Credit Advance, a
Letter of Credit Advance or a Swing Line Advance.
"AFFILIATE" means, with respect to any Person, any other
Person that, directly or indirectly, controls, is controlled by or is
under common control with such Person or is a director or officer of
such Person. For purposes of this definition, the term "CONTROL"
(including the terms "CONTROLLING", "CONTROLLED BY" and "UNDER COMMON
CONTROL WITH") of a Person means the possession, direct or indirect, of
the power to vote 5% or more of the Voting Stock of such Person or to
direct or cause the direction of the management and policies of such
Person, whether through the ownership of Voting Stock, by contract or
otherwise.
" AGENT" has the meaning specified in the recital of parties
to this Agreement and shall not refer to either the Syndication Agent
or the Documentation Agent unless the context otherwise specifically so
indicates, but 'AGENTS' shall refer to the Agent, the Syndication Agent
and the Documentation Agent."
"AGENT'S ACCOUNT" means the account of the Agent maintained by
the Agent at the Federal Reserve Bank of New York, 00 Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Account No. 75042070103, or such other
account maintained by the Agent and designated by the Agent in a
written notice to the Lenders, the Issuing Bank, the Existing Issuing
Banks and the Borrower.
"APPLICABLE LENDING OFFICE" means (a) with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base
Rate Advance and such Lender's Eurodollar Lending Office in the case of
a Eurodollar Rate Advance, (b) with respect to the Issuing Bank, such
Issuing Bank's Domestic Lending Office in the case of a Letter of
Credit Advance and (c) with respect to each Existing Issuing Bank, such
Existing Bank's Domestic Lending Office in the case of a Letter of
Credit Advance and (d) with respect to the Swing Line Bank, the Swing
Line Bank's Domestic Lending Office in the case of a Swing Line
Advance.
"APPLICABLE MARGIN" means 1.00% per annum for Base Rate
Advances and 2.50% per annum for Eurodollar Rate Advances.
"APPROPRIATE LENDER" means, at any time, with respect to (a)
either of the Term or Revolving Credit Facilities, a Lender that has a
Commitment with respect to such Facility at such time, (b) the Letter
of Credit Facility, (i) any Issuing Bank and (ii) if the other
Revolving Credit Lenders have made Letter of Credit Advances pursuant
to Section 2.13(c) that are outstanding at such time, each such other
Revolving Credit Lender and (c) the Swing Line Facility, (i) the Swing
Line Bank and (ii) if the other Revolving Credit Lenders have made
Swing Line Advances pursuant to Section 2.02(f) that are outstanding at
such time, each such other Revolving Credit Lender.
"ASSIGNMENT AND ACCEPTANCE" means an assignment and acceptance
entered into by a Lender and an Eligible Assignee, and accepted by the
Agent, in accordance with Section 8.07 and in substantially the form of
Exhibit C hereto.
"ASSUMPTION AGREEMENT" means the assumption agreement in form
and substance satisfactory to the Lenders, pursuant to which Signature
assumes all of the Obligations of the Borrower under the Loan
Documents.
8
3
"AVAILABLE AMOUNT" of any Letter of Credit means, at any time,
the maximum available amount available to be drawn under such Letter of
Credit at such time (assuming compliance at such time with all
conditions to drawing).
"BANKS" has the meaning specified in the recital of parties to
this Agreement.
"BASE RATE" means a fluctuating interest rate per annum in
effect from time to time, which rate per annum shall at all times be
equal to the higher of:
(a) the rate of interest announced publicly by BNP in
New York City, from time to time as its prime rate (and such
term shall not be construed to be its best or most favorable
rate); and
(b) 1/2 of 1% per annum above the Federal Funds Rate.
"BASE RATE ADVANCE" means an Advance that bears interest as
provided in Section 2.06(a)(i).
"BNP" has the meaning specified in the recital of parties to
this Agreement.
"BOARD OF DIRECTORS" means, with respect to any Person, the
board of directors of such Person or any duly authorized committee of
such board.
"BORROWER" has the meaning specified in the recital of parties
to this Agreement.
"BORROWER'S ACCOUNT" means the account of the Borrower
maintained by the Borrower with BNP at its office at 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Account No. 20168100193, or such other
account as is agreed upon between the Borrower and the Agent.
"BORROWING" means a Term Borrowing, a Revolving Credit
Borrowing or a Swing Line Borrowing.
"BORROWING BASE REPORT" has the meaning specified in Section
3.01(n).
"BRANDS" has the meaning specified in the Preliminary
Statements to this Agreement.
"BRANDS GUARANTY" has the meaning specified in Section
3.01(n).
"BRANDS PLEDGE AGREEMENT" has the meaning specified in Section
3.01(n).
"BUSINESS DAY" means a day of the year on which banks are not
required or authorized to close in New York City and, if the applicable
Business Day relates to any Eurodollar Rate Advances, on which dealings
are carried on in the London interbank market.
"CAPITAL EXPENDITURES" means, for any period, the sum (without
duplication) of (a) all expenditures during such period for capital
assets as determined in accordance with GAAP for such period (other
than expenditures for replacements and substitutions for such capital
assets from the proceeds of insurance) PLUS (b) the aggregate principal
amount of all Indebtedness (including obligations under Capitalized
Leases) assumed or incurred in connection with any expenditures
referred to in clause (a) above.
"CAPITALIZED LEASES" has the meaning specified in clause (e)
of the definition of "INDEBTEDNESS".
9
4
"CASH EQUIVALENTS" means any of the following, to the extent
owned by the Borrower free and clear of all Liens (other than any Liens
created pursuant to the Security Agreement) and having a maturity of
not greater than 90 days from the date of acquisition thereof:
(a) readily marketable direct obligations of the
Government of the United States or any agency or
instrumentality thereof or obligations unconditionally
guaranteed by the full faith and credit of the Government of
the United States;
(b) certificates of deposit of or time deposits with
any commercial bank that is (i) a Lender or (ii) a member of
the Federal Reserve System that issues (or the parent of which
issues) commercial paper rated as described in clause (c)
below, that is organized under the laws of the United States
or any state thereof and that has combined capital and surplus
of at least $750,000,000;
(c) commercial paper in an aggregate amount of no
more than $250,000 per issuer at any time outstanding, issued
by any corporation organized under the laws of any state of
the United States and rated at least "Prime-1" (or the then
equivalent grade) by Xxxxx'x Investors Service, Inc. or "A-1"
(or the then equivalent grade) by Standard & Poor's
Corporation; or
(d) money market mutual funds registered under the
Investment Company Act, investing in obligations, or
repurchase agreements secured by obligations, of the type
described in clause (a) or (b) above.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended from time to time.
"CLAIMS" has the meaning specified in the definition of
"ENVIRONMENTAL ACTION".
"COLLATERAL" means all "Collateral" referred to in the
Collateral Documents and all other property that is subject to any Lien
in favor of the Agents, the Swing Line Bank,, the Lenders, the Issuing
Bank, the Existing Issuing Banks or the Hedge Banks.
"COLLATERAL DOCUMENTS" means the Brands Pledge Agreement, the
Security Agreement, the Patent, Trademark and Copyright Security
Agreement, the Mortgages and each other agreement evidencing the
creation of a Lien upon the Collateral in favor of the Agents, the
Swing Line Bank,, the Lenders, the Issuing Bank, the Existing Issuing
Banks or the Hedge Banks.
"COMMITMENT" means a Term Commitment, a Revolving Credit
Commitment or a Letter of Credit Commitment.
"CONCEPTS" means Mr. Coffee Concepts, Inc., a North Carolina
corporation, 50% of the issued and outstanding capital stock of which
is owned by Mr. Coffee and 50% of the issued and outstanding capital
stock of which is owned by S&D Coffee Co.
"CONFIDENTIAL INFORMATION" means information that is furnished
to the Agents, any Lender, the Issuing Bank or any Existing Issuing
Bank by or on behalf of the Borrower on a confidential basis, but does
not include any such information that is or becomes generally available
to the public other than as a result of a breach by the Agents, any
Lender, the Issuing Bank or any Existing Issuing Bank of its
obligations hereunder or that is or becomes available to the Agents,
such Lender, the Issuing Bank or such Existing Issuing Bank from a
source other than the Borrower that is not, to the best of the Agents,
such
10
5
Lender's, the Issuing Bank's or such Existing Issuing Bank's knowledge,
acting in violation of a confidentiality agreement with the Borrower.
"CONSOLIDATED" refers to the consolidation of accounts in
accordance with GAAP.
"CONVERSION", "CONVERT" and "CONVERTED" each refer to a
conversion of Advances of one Type into Advances of the other Type
pursuant to Section 2.08 or 2.09.
"CURRENT ASSETS" means, with respect to any Person for any
period, all assets of such Person that would, in accordance with GAAP,
be classified as current assets of a company conducting a business the
same as or similar to that of such Person during such period, after
deducting adequate reserves in each case in which a reserve is proper
in accordance with GAAP.
"CURRENT LIABILITIES" means, with respect to any Person for
any period, (a) all Indebtedness (other than Funded Indebtedness) of
such Person that by its terms is payable on demand or matures within
one year after the date of incurrence (excluding any Indebtedness
renewable or extendible, at the option of such Person, to a date more
than one year from such date or arising under a revolving credit or
similar agreement that obligates the lender or lenders to extend credit
during a period of more than one year from such date) and (b) all other
items (including, without limitation, taxes accrued as estimated) that
in accordance with GAAP would be classified as current liabilities of
such Person.
"DEFAULT" means any Event of Default or any event that would
constitute an Event of Default but for the requirement that notice be
given or time elapse or both.
"DEFAULTED ADVANCE" means, with respect to any Lender at any
time, the amount of any Advance required to be made by such Lender to
the Borrower pursuant to Section 2.01 at or prior to such time that has
not been so made as of such time; PROVIDED, HOWEVER, that any Advance
made by the Agent for the account of such Lender pursuant to Section
2.02(d) shall not be considered a Defaulted Advance even if, at such
time, such Lender shall not have reimbursed the Agent therefor as
provided in Section 2.02(d). In the event that a portion of a Defaulted
Advance shall be deemed made pursuant to Section 2.14(a), the remaining
portion of such Defaulted Advance shall be considered a Defaulted
Advance originally required to be made pursuant to Section 2.01 on the
same date as the Defaulted Advance so deemed made in part.
"DEFAULTED AMOUNT" means, with respect to any Lender at any
time, any amount required to be paid by such Lender to the Agents, the
Swing Line Bank,, any other Lender, the Issuing Bank or any Existing
Issuing Bank hereunder or under any other Loan Document at or prior to
such time that has not been so paid as of such time, including, without
limitation, any amount required to be paid by such Lender to (a) the
Issuing Bank or any Existing Issuing Bank pursuant to Section 2.13(c)
to purchase a portion of a Letter of Credit Advance made by the Issuing
Bank or such Existing Issuing Bank, (b) the Agents, the Swing Line
Bank, pursuant to Section 2.02(d) to reimburse the Agents, the Swing
Line Bank, for the amount of any Advance made by the Agents, the Swing
Line Bank, for the account of such Lender, (c) any other Lender
pursuant to Section 2.12 to purchase any participation in Advances
owing to such other Lender and (d) the Agents, the Swing Line Bank,,
the Issuing Bank or any Existing Issuing Bank, as the case may be,
pursuant to Section 7.05 to reimburse the Agents, the Swing Line Bank,,
the Issuing Bank or such Existing Issuing Bank for such Lender's
ratable share of any amount required to be paid by the Lenders to the
Agents, the Swing Line Bank,, the Issuing Bank or such Existing Issuing
Bank as provided therein. In the event that a portion of a Defaulted
Amount shall be deemed paid pursuant to Section 2.14(b), the remaining
portion of such Defaulted Amount shall be considered a Defaulted Amount
originally required to be made hereunder or under any other Loan
Document on the same date as the Defaulted Amount so deemed paid in
part.
11
6
"DEFAULTING LENDER" means, at any time, any Lender that, at
such time, (a) owes a Defaulted Advance or a Defaulted Amount or (b)
shall take or be the subject of any action or proceeding of a type
described in Section 6.01(e).
"DISCLOSED LITIGATION" has the meaning specified in Section
4.01(j).
"DOCUMENTATION AGENT" means NBD Bank.
"DOMESTIC LENDING OFFICE" means, with respect to any Lender,
the Swing Line Bank, the Issuing Bank or any Existing Issuing Bank, the
office of such Lender, the Swing Line Bank, the Issuing Bank or such
Existing Issuing Bank specified as its "Domestic Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which such Lender became a Lender, or such other
office of such Lender, the Swing Line Bank, the Issuing Bank or such
Existing Issuing Bank as such Lender, the Swing Line Bank, the Issuing
Bank or such Existing Issuing Bank may from time to time specify to the
Borrower and the Agent.
"EBITDA" means, for any Person for any period, (a) net income
(or net loss) PLUS (b) the sum of (i) interest expense, (ii) income tax
expense, (iii) depreciation expense, (iv) amortization expense, (v)
noncash charges relating to pensions, stock options, stock appreciation
rights and other equity based employee incentive plans and (vi)
extraordinary or unusual losses deducted in calculating net income LESS
the sum of (1) extraordinary or unusual gains added in calculating net
income and (2) noncash credits relating to pensions, stock options,
stock appreciation rights and other equity based employee incentive
plans, in each case determined in accordance with GAAP for such Person
for such period and (vii) Nonrecurring Restructuring and Relocation
Charges before income taxes.
"ELIGIBLE ASSIGNEE" means:
(a) a commercial bank organized under the laws of the
United States, or any state thereof, and having a combined
capital and surplus of at least $750,000,000;
(b) a savings and loan association or savings bank
organized under the laws of the United States, or any state
thereof, and having a combined capital and surplus of at least
$750,000,000;
(c) a commercial bank organized under the laws of any
other country that is a member of the OECD or has concluded
special lending arrangements with the International Monetary
Fund associated with its General Arrangements to Borrow, or a
political subdivision of any such country, and having a
combined capital and surplus of at least $750,000,000 so long
as such bank is acting through a branch or agency located in
the United States;
(d) the central bank of any country that is a member
of the OECD;
(e) a finance company, insurance company or other
financial institution or fund (whether a corporation,
partnership, trust or other entity) that is engaged in making,
purchasing or otherwise investing in commercial loans in the
ordinary course of its business and having a combined capital
and surplus of at least $750,000,000 or with respect to a fund
with total assets under its management in excess of
$500,000,000; and
(f) any other Person (other than an Affiliate of the
Borrower) approved by the Agent and the Borrower, such
approval not to be unreasonably withheld.
12
7
"ELIGIBLE COLLATERAL" means, collectively, Eligible Inventory
and Eligible Receivables.
"ELIGIBLE INVENTORY" means any Inventory owned by the Borrower
or any of its Subsidiaries free and clear of all Liens (other than
Liens in favor of the Agent, the Lenders, the Swing Line Bank, the
Issuing Bank, the Existing Issuing Banks and the Hedge Banks securing
the Secured Obligations) other than the following:
(a) Inventory consisting of "perishable agricultural
commodities" within the meaning of the Perishable Agricultural
Commodities Act of 1930, as amended, and the regulations
thereunder, other than, to the extent consisting of
"perishable agricultural commodities", coffee having an
aggregate value not to exceed at any time $1,000,000, or on
which a Lien has arisen or may arise in favor of agricultural
producers under comparable state or local laws;
(b) Inventory located on leaseholds or in warehouses,
in each case, except for such leaseholds identified on
Schedule 5.01(o) to the extent permitted in Section 5.01(o),
as to which the lessor or the warehouseman has not entered
into a consent and agreement providing for such rights as may
be reasonably requested by the Agent;
(c) Inventory of the Borrower or such Subsidiary in
the possession of any supplier (other than any such supplier
with respect to which such Inventory is located on real
property leased by such supplier from an unaffiliated third
party) of the Borrower or such Subsidiary, in each case, as to
which such supplier has not entered into a consent and
agreement providing for such rights as may be reasonably
requested by the Agent;
(d) Inventory in respect of which the Security
Agreement, after giving effect to the related filings of
financing statements that have then been made, if any, does
not or has ceased to create a valid and perfected first
priority Lien in favor of the Agent, the Lenders, the Swing
Line Bank, the Issuing Bank, the Existing Issuing Banks and
the Hedge Banks securing the Secured Obligations;
(e) Inventory with respect to which the
representations and warranties set forth in Section 8 of the
Security Agreement that are applicable to Inventory are not
true and correct;
(f) Inventory that fails to meet all standards
imposed by any governmental agency, or department or division
thereof, having regulatory authority over such Inventory, its
use or its sale;
(g) Inventory that is subject to any licensing,
patent, royalty, trademark, trade name or copyright agreements
with any third party from whom the Borrower or any such
Subsidiary has received notice of a dispute in respect of any
such agreement;
(h) Inventory located outside the United States or
Canada other than Inventory in transit to the Borrower or such
Subsidiary and as to which title has passed to the Borrower or
such Subsidiary;
(i) Inventory consisting of work in progress, as such
Inventory is identified in the books and records of the
Borrower or such Subsidiary; and
(j) Inventory that is obsolete, unusable or otherwise
unavailable for sale in the ordinary course of business of the
Borrower or such Subsidiary.
13
8
The value of such Eligible Inventory shall be its book value determined
in accordance with GAAP unless the Agent determines, in its reasonable
discretion (taking into consideration, among other factors, its cost
and its liquidation value), that such Eligible Inventory shall be
valued at a lower value.
"ELIGIBLE RECEIVABLES" means any Receivables owned by the
Borrower or any of its Subsidiaries free and clear of all Liens (other
than Liens in favor of the Agent, the Lenders, the Swing Line Bank, the
Issuing Bank, the Existing Issuing Banks and the Hedge Banks securing
the Secured Obligations) other than the following:
(a) Receivables that do not arise out of sales of
goods or the rendering of services in the ordinary course of
business of the Borrower or such Subsidiary;
(b) Receivables on terms other than those normal or
customary in the business of the Borrower or such Subsidiary;
(c) Receivables owing from any Person that is an
Affiliate of the Borrower or such Subsidiary other than
Receivables on terms that are fair and reasonable and no less
favorable to the Borrower or such Subsidiary than it would
obtain in a comparable arm's length transaction with a Person
that is not an Affiliate;
(d) Receivables that are more than 180 days past the
original invoice date or more than 60 days past the date due;
(e) Receivables owing from any Person for whom an
aggregate amount of more than 20% of the Receivables owing
therefrom is more than 60 days past due;
(f) Receivables owing from any Person that (i) has
disputed liability for any Receivable owing from such Person
in the amount of such disputed Receivable or (ii) has
otherwise asserted any claim, demand or liability against the
Borrower or any of its Subsidiaries, whether by action, suit
or counterclaim;
(g) Receivables owing from any Person that shall take
or be the subject of any action or proceeding of a type
described in Section 6.01(e);
(h) Receivables (i) owing from any Person that is
also (A) a supplier to the Borrower or such Subsidiary except
to the extent that the amount of such Receivables exceeds the
amount owed to such supplier or (B) a creditor of the Borrower
or such Subsidiary except to the extent that the amount of
such Receivables exceeds the amount of any indebtedness owed
to such creditor (unless, in each case, such Person has waived
any right of setoff in a manner acceptable to the Agent) or
(ii) representing any manufacturer's or supplier's credits,
discounts, incentive plans or similar arrangements entitling
the Borrower or such Subsidiary to discounts on future
purchase therefrom;
(i) Receivables arising out of sales to account
debtors outside the United States or Canada;
(j) Receivables arising out of sales on a
xxxx-and-hold, guaranteed sale, sale-or- return, sale on
approval or consignment basis or subject to any right of
setoff or right of return or charge-back;
14
9
(k) Receivables owing from an account debtor that is
an agency, department or instrumentality of the United States
or any state thereof or Canada or any province or territory
thereof, unless, with respect to the United States or such
state thereof, the Borrower or such Subsidiary shall have
satisfied the requirements of the Assignment of Claims Act of
1940, as amended, and any similar state legislation and the
Agent is satisfied as to the absence of set-offs,
counterclaims and other defenses on the part of such account
debtor; and
(l) Receivables in respect of which the Security
Agreement, after giving effect to the related filings of
financing statements that have then been made, if any, does
not or has ceased to create a valid and perfected first
priority Lien in favor of the Agent, the Lenders, the Swing
Line Bank, the Issuing Bank, the Existing Issuing Banks and
the Hedge Banks securing the Secured Obligations.
The value of such Eligible Receivables shall be their book value
determined in accordance with GAAP unless the Agent determines, in its
reasonable discretion, that such Eligible Receivables shall be valued
at a lower value.
"ENVIRONMENTAL ACTION" means any administrative, regulatory or
judicial action, suit, demand, demand letter, claim, notice of
noncompliance or violation, investigation, proceeding, consent order or
consent agreement relating in any way to any Environmental Law or any
Environmental Permit (collectively, "CLAIMS") including, without
limitation, (a) any Claim by any governmental or regulatory authority
for enforcement, cleanup, removal, response, remedial or other actions
or damages pursuant to any Environmental Law and (b) any Claim by any
third party seeking damages, contribution, indemnification, cost
recovery, compensation or injunctive relief resulting from Hazardous
Materials or arising from alleged injury or threat of injury to health,
safety or the environment.
"ENVIRONMENTAL LAW" means any federal, state or local law,
statute, rule, regulation, order, writ, judgment, injunction, decree,
determination or award relating to the environment, health, safety or
Hazardous Materials, including, without limitation, CERCLA, the
Resource Conservation and Recovery Act, the Hazardous Materials
Transportation Act, the Clean Water Act, the Toxic Substances Control
Act, the Clean Air Act, the Safe Drinking Water Act, the Atomic Energy
Act, the Federal Insecticide, Fungicide and Rodenticide Act and the
Occupational Safety and Health Act, in each case as amended from time
to time.
"ENVIRONMENTAL PERMIT" means any permit, approval,
identification number, license or other authorization required under
any Environmental Law.
"EQUITY INVESTORS" means XX-Xxx Acquisition Fund L.P., XX-Xxx
Acquisition Fund II, L.P., XX Xxx Acquisition Fund (Retirement
Accounts) II, L.P., Xxxxxx X. Xxx Equity Partners, L.P. and its co-
investors, Xxxxxx X. Xxx Company.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"ERISA AFFILIATE" means, with respect to any Person, any other
Person that for purposes of Title IV of ERISA is a member of such
Person's controlled group, or under common control with such Person,
within the meaning of Section 414 of the Internal Revenue Code.
"ERISA EVENT" means, with respect to any Person:
15
10
(a) the occurrence of a reportable event, within the
meaning of Section 4043 of ERISA, with respect to any Plan
maintained or contributed to by such Person or any of its
ERISA Affiliates unless the 30-day notice requirement with
respect to such event has been waived by the PBGC;
(b) the provision by the administrator of any Plan of
such Person or any of its ERISA Affiliates of a notice of
intent to terminate such Plan, pursuant to Section 4041(a)(2)
of ERISA (including any such notice with respect to a plan
amendment referred to in Section 4041(e) of ERISA);
(c) the cessation of operations at a facility of such
Person or any of its ERISA Affiliates in the circumstances
described in Section 4062(e) of ERISA;
(d) the withdrawal by such Person or any of its ERISA
Affiliates from a Multiple Employer Plan during a plan year
for which it was a substantial employer, as defined in Section
4001(a)(2) of ERISA;
(e) the failure by such Person or any of its ERISA
Affiliates to make a payment to a Plan required under Section
302(f)(1) of ERISA;
(f) the adoption of an amendment to a Plan of such
Person or any of its ERISA Affiliates requiring the provision
of security to such Plan, pursuant to Section 307 of ERISA; or
(g) the institution by the PBGC of proceedings to
terminate a Plan of such Person or any of its ERISA
Affiliates, pursuant to Section 4042 of ERISA, or the
occurrence of any event or condition described in Section 4042
of ERISA that could constitute grounds for the termination of,
or the appointment of a trustee to administer, such Plan.
"EUROCURRENCY LIABILITIES" has the meaning specified in
Regulation D of the Board of Governors of the Federal Reserve System,
as in effect from time to time.
"EURODOLLAR LENDING OFFICE" means, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office"
opposite its name on Schedule I hereto or in the Assignment and
Acceptance pursuant to which it became a Lender (or, if no such office
is specified, its Domestic Lending Office), or such other office of
such Lender as such Lender may from time to time specify to the
Borrower and the Agent.
"EURODOLLAR RATE" means, for any Interest Period for all
Eurodollar Rate Advances comprising part of the same Borrowing, an
interest rate per annum equal to the rate per annum obtained by
dividing (a) the rate per annum at which deposits in U.S. dollars are
offered by the principal office of BNP in London, England to prime
banks in the London interbank market at 11:00 A.M. (London time) two
Business Days before the first day of such Interest Period in an amount
substantially equal to BNP's Eurodollar Rate Advance comprising part of
such Borrowing to be outstanding during such Interest Period and for a
period equal to such Interest Period by (b) a percentage equal to 100%
MINUS the Eurodollar Rate Reserve Percentage for such Interest Period.
"EURODOLLAR RATE ADVANCE" means an Advance that bears interest
as provided in Section 2.06(a)(ii).
16
11
"EURODOLLAR RATE RESERVE PERCENTAGE" means, for any Interest
Period for all Eurodollar Rate Advances comprising part of the same
Borrowing, the reserve percentage applicable two Business Days before
the first day of such Interest Period under regulations issued from
time to time by the Board of Governors of the Federal Reserve System
(or any successor thereto) for determining the maximum reserve
requirement (including, without limitation, any emergency, supplemental
or other marginal reserve requirement) for a member bank of the Federal
Reserve System in New York City with respect to liabilities or assets
consisting of or including Eurocurrency Liabilities (or with respect to
any other category of liabilities that includes deposits by reference
to which the interest rate on Eurodollar Rate Advances is determined)
having a term equal to such Interest Period.
"EVENTS OF DEFAULT" has the meaning specified in Section 6.01.
"EXCESS CASH FLOW" means, for any period, the sum of (a)
Consolidated pre-tax income (or pre-tax loss) of the Borrower and its
Subsidiaries for such period LESS (b) Consolidated income tax expense
of Borrower and its Subsidiaries for such period PLUS (c) an amount
equal to the aggregate amount of all noncash charges deducted in
arriving at such Consolidated net income (or net loss) for such period
PLUS (d) an amount (whether positive or negative), without duplication
of any amount specified in clause (c) above, equal to the change in
Consolidated Current Liabilities of the Borrower and its Subsidiaries
during such period LESS (e) an amount equal to the aggregate amount of
all noncash credits included in arriving at such Consolidated net
income (or net loss) for such period LESS (f) an amount (whether
positive or negative), without duplication of any amount specified in
clause (e) above, equal to the change in Consolidated Current Assets
(excluding cash and Cash Equivalents) of the Borrower and its
Subsidiaries during such period LESS (g) an amount equal to the amount
of all Capital Expenditures of the Borrower and its Subsidiaries made
in cash during such period to the extent permitted by this Agreement
LESS (h) an amount equal to the aggregate amount of all regularly
scheduled principal payments of Funded Indebtedness made during such
period, together with any optional prepayments of any Term Advances
made during such period in accordance with Section 2.05(a), LESS (i) an
amount equal to the amount of all dividends and distributions by the
Borrower paid in cash during such period to the extent permitted by
Section 5.02(g)(ii) LESS (j) an amount equal to the amount by which any
prepayment of Term Advances under Section 2.05(b)(ii)(A) exceeds the
book value of the assets sold, leased, transferred or otherwise
disposed of that gave rise to such prepayment.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time.
"EXISTING ISSUING BANK" means an issuer of an Existing Letter
of Credit.
"EXISTING LETTERS OF CREDIT" has the meaning specified in
Section 2.13(a).
"FACILITY" means the Term Facility, the Revolving Credit
Facility, the Letter of Credit Facility or the Swing Line Facility..
"FEDERAL FUNDS RATE" means, for any period, a fluctuating
interest rate per annum equal for each day during such period (i) to
the rate published by the Telerate service on page five of its daily
report as the "New York Offered Rate" as of 10:00 A.M. (New York City
time) for such day (or, if such day is not a Business Day, for the
immediately preceding Business Day) or (ii) if the Telerate service
shall cease to publish or otherwise shall not publish such rates for
any day that is a Business Day, to the weighted average of the rates on
overnight federal funds transactions with members of the Federal
Reserve System arranged by federal funds brokers, as published for such
day (or, if such day is not a Business Day, for the immediately
preceding Business Day) by the Federal Reserve Bank of New York, or, if
such rate is
17
12
not so published for any day that is a Business Day, the average of the
quotations for such day for such transactions received by the Agent
from three federal funds brokers of recognized standing selected by it.
"FIRST MERGER" has the meaning specified in the Preliminary
Statements to this Agreement.
"FIRST MERGER CERTIFICATE" has the meaning specified in the
Preliminary Statements to this Agreement.
"FIXED CHARGE COVERAGE RATIO" means, with respect to any
Person for any period, without duplication, the ratio of (a)
Consolidated EBITDA for such Person and its Subsidiaries for such
period LESS income taxes of such Person and its Subsidiaries that have
been paid in cash during such period to (b) the sum of (i) Interest
Expense of such Person and its Subsidiaries that have been paid in cash
during such period and (ii) regularly scheduled principal payments of
Funded Indebtedness of such Person and its Subsidiaries made during
such period.
"FUNDED INDEBTEDNESS" means, with respect to any Person,
Indebtedness in respect of the Advances, in the case of the Borrower,
and all other Indebtedness of such Person that by its terms matures
more than one year from the date of incurrence or matures within one
year from such date but is renewable or extendible, at the option of
such Person, to a date more than one year after such date or arises
under a revolving credit or similar agreement that obligates the lender
or lenders to extend credit during a period of more than one year after
such date.
"GAAP" has the meaning specified in Section 1.03.
"GUARANTY" means the Brands Guaranty or the Subsidiaries'
Guaranty.
"HAZARDOUS MATERIALS" means (a) petroleum or petroleum
products, natural or synthetic gas, asbestos in any form that is or
could become friable, urea formaldehyde foam insulation and radon gas,
(b) any substances defined as or included in the definition of
"hazardous substances", "hazardous wastes", "hazardous materials",
"extremely hazardous wastes", "restricted hazardous wastes", "toxic
substances", "toxic pollutants", "contaminants" or "pollutants", or
words of similar import, under any Environmental Law and (c) any other
substance that is regulated under any Environmental Law.
"SIGNATURE" has the meaning specified in the recital of
parties to this Agreement.
"HEDGE AGREEMENTS" means interest rate swap, cap or collar
agreements, interest rate future or option contracts, currency swap
agreements, currency future or option contracts and other similar
agreements.
"HEDGE BANKS" has the meaning specified in the Security
Agreement.
"INCREASED TERM COMMITMENT" means the amount set forth
opposite such Term Lender's name on Schedule I hereto.
"INDEBTEDNESS" of any Person means, without duplication:
(a) all indebtedness of such Person for borrowed
money;
(b) all Obligations of such Person for the deferred
purchase price of property or services (including, without
limitation, covenants not to compete) other than trade
payables and
18
13
accrued expenses, each not overdue by more than 60 days after
the original due date and incurred in the ordinary course of
such Person's business;
(c) all Obligations of such Person evidenced by
notes, bonds, debentures or other similar instruments;
(d) all Obligations of such Person created or arising
under any conditional sale or other title retention agreement
with respect to property acquired by such Person (even though
the rights and remedies of the seller or lender under such
agreement in the event of default are limited to repossession
or sale of such property);
(e) all Obligations of such Person as lessee under
leases that have been or should be, in accordance with GAAP,
recorded as capital leases ("CAPITALIZED LEASES");
(f) all Obligations, contingent or otherwise, of such
Person under acceptance, letter of credit or similar
facilities;
(g) all Obligations of such Person to purchase,
redeem, retire, defease or otherwise make any payment in
respect of any capital stock of or other ownership or profit
interest in such Person or any other Person or any warrants,
rights or options to acquire such capital stock, valued, in
the case of Redeemable Preferred Stock, at the greater of its
voluntary or involuntary liquidation preference PLUS accrued
and unpaid dividends;
(h) all Obligations of such Person in respect of
Hedge Agreements;
(i) all Indebtedness of others referred to in clauses
(a) through (h) above guaranteed directly or indirectly in any
manner by such Person, or in effect guaranteed directly or
indirectly by such Person through an agreement (i) to pay or
purchase such Indebtedness or to advance or supply funds for
the payment or purchase of such Indebtedness, (ii) 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, (iii) to
supply funds to or in any other manner invest in the debtor
(including, without limitation, any agreement to pay for
property or services irrespective of whether such property is
received or such services are rendered) or (iv) otherwise to
assure a creditor against loss; and
(j) all Indebtedness referred to in clauses (a)
through (h) above secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise,
to be secured by) any Lien on property (including, without
limitation, accounts and contract rights) owned by such
Person, even though such Person has not assumed or become
liable for the payment of such Indebtedness.
"INDEMNIFIED PARTY" has the meaning specified in Section
8.04(b).
"INDENTURE" means the Indenture dated as of August 17, 1994
between the Borrower and American Bank National Association, as
trustee, pursuant to which the Subordinated Notes are issued.
"INSUFFICIENCY" means, with respect to any Plan, the amount,
if any, of its unfunded benefit liabilities, as defined in Section
4001(a)(18) of ERISA.
19
14
"INTEREST COVERAGE RATIO" means, with respect to any Person
for any period, the ratio of (a) Consolidated EBITDA of such Person and
its Subsidiaries for such period to (b) Interest Expense of such Person
and its Subsidiaries for such period.
"INTEREST EXPENSE" means, with respect to any Person for any
period, interest expense (including the interest component on
obligations under Capitalized Leases), whether paid or accrued, on all
Indebtedness of such Person and its Subsidiaries for such period,
including, without limitation, (a) interest expense in respect of
Indebtedness resulting from Advances, (b) interest expense in respect
of the Subordinated Notes, (c) commissions, discounts and other fees
and charges payable in connection with letters of credit (including,
without limitation, any Letters of Credit) and (d) any net payment
payable in connection with Hedge Agreements LESS any net credits
received in connection with Hedge Agreements, but excluding
amortization with respect to deferred financing fees.
"INTEREST PERIOD" means, for all Eurodollar Rate Advances
comprising part of the same Borrowing, the period commencing on the
date of such Eurodollar Rate Advances or on the date of the Conversion
of any Base Rate Advance into any such Eurodollar Rate Advance, and
ending on the last day of the period selected by the Borrower pursuant
to the provisions below and, thereafter, each subsequent period
commencing on the last day of the immediately preceding Interest Period
and ending on the last day of the period selected by the Borrower
pursuant to the provisions below. The duration of each such Interest
Period shall be one, two, three or six months, as the Borrower may,
upon notice received by the Agent not later than 11:00 A.M. (New York
City time) on the third Business Day prior to the first day of such
Interest Period, select; PROVIDED, HOWEVER, that:
(a) the Borrower may not select any Interest Period
that ends after any principal repayment installment date
unless, after giving effect to such selection, the aggregate
principal amount of Base Rate Advances and of Eurodollar Rate
Advances having Interest Periods that end on or prior to such
principal repayment installment date shall be at least equal
to the aggregate principal amount of Advances due and payable
on or prior to such date;
(b) Interest Periods commencing on the same date for
Eurodollar Rate Advances comprising part of the same Borrowing
shall be of the same duration;
(c) whenever the last day of any Interest Period
would otherwise occur on a day other than a Business Day, the
last day of such Interest Period shall be extended to occur on
the next succeeding Business Day; PROVIDED, HOWEVER, that, if
such extension would cause the last day of such Interest
Period to occur in the next following calendar month, the last
day of such Interest Period shall occur on the immediately
preceding Business Day; and
(d) whenever the first day of any Interest Period
occurs on a day of an initial calendar month for which there
is no numerically corresponding day in the calendar month that
succeeds such initial calendar month by the number of months
equal to the number of months in such Interest Period, such
Interest Period shall end on the last Business Day of such
succeeding calendar month.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of
1986, as amended from time to time, and the regulations promulgated and
the rulings issued thereunder.
"INVENTORY" has the meaning specified in the Security
Agreement.
20
15
"INVESTMENT" in any Person means any loan or advance to such
Person, any purchase or other acquisition of any capital stock,
warrants, rights, options, obligations or other securities of such
Person, any capital contribution to such Person or any other investment
in such Person, including, without limitation, any arrangement pursuant
to which the investor incurs Indebtedness of the types referred to in
clauses (i) and (j) of the definition of "INDEBTEDNESS" in respect of
such Person.
"INVESTMENT COMPANY ACT" means the Investment Company Act of
1940, as amended.
"ISSUING BANK" means BNP as the issuer of the Letters of
Credit.
"KAVA" means Java Kava International Ltd., a U.S. Virgin
Islands corporation.
"L/C CASH COLLATERAL ACCOUNT" has the meaning specified in the
Security Agreement.
"L/C RELATED DOCUMENTS" has the meaning specified in Section
2.13(e).
"LENDERS" means the Banks listed on the signature pages hereof
and each Eligible Assignee that shall become a party hereto pursuant to
Section 8.07.
"LETTER OF CREDIT" has the meaning specified in Section
2.13(a).
"LETTER OF CREDIT ADVANCE" has the meaning specified in
Section 2.13(c).
"LETTER OF CREDIT AGREEMENT" has the meaning specified in
Section 2.13(b).
"LETTER OF CREDIT COMMITMENT" means, with respect to the
Issuing Bank, at any time, the amount set forth opposite the Issuing
Bank's name on Schedule I hereto under the caption "Letter of Credit
Commitment" or, if the Issuing Bank has entered into one or more
Assignments and Acceptances, set forth for the Issuing Bank in the
Register maintained by the Agent pursuant to Section 8.07(c) as the
Issuing Bank's "Letter of Credit Commitment", as such amount may be
reduced at or prior to such time pursuant to Section 2.04.
"LETTER OF CREDIT FACILITY" means the amount of the Letter of
Credit Commitment of the Issuing Bank.
"LEVERAGE RATIO" means, with respect to any Person at any date
of determination, the ratio of (a) Funded Indebtedness (other than
Indebtedness in respect of the Revolving Credit Advances, the Letter of
Credit Advances and the Subordinated Notes) of such Person and its
Subsidiaries at such date to (b) with respect to any month ending prior
to September 1, 1995, an amount equal to Consolidated EBITDA of such
Person and its Subsidiaries as of the last day of the most recently
completed Rolling Period multiplied by a quotient derived by dividing
12 by the number of months (including any fraction thereof) in such
Rolling Period and, with respect to any month thereafter, Consolidated
EBITDA of such Person and its Subsidiaries as of the last day of the
most recently completed Rolling Period prior to such date.
"LIEN" means any lien, security interest or other charge or
encumbrance of any kind, or any other type of preferential arrangement,
including, without limitation, the lien or retained security title of a
conditional vendor and any easement, right of way or other encumbrance
on title to real property.
21
16
"LOAN DOCUMENTS" means this Agreement, the Notes, each
Guaranty, the Collateral Documents, each Letter of Credit Agreement and
each other agreement evidencing the payment of obligations secured by
Collateral Documents.
"LOAN PARTIES" means the Borrower, Brands, the Surviving
Corporation and each other Subsidiary of the Borrower that executes a
security agreement and/or guaranty pursuant to Section 5.02(i).
"LOAN VALUE" means a percentage of the value of any item of
Eligible Collateral equal to, with respect to all Eligible Collateral,
the sum of up to the following amounts and, with respect to a
particular category of Eligible Collateral, up to the following amount
for such category of Eligible Collateral: (a) with respect to Eligible
Inventory, 50% or, with respect to the months of August through
November in each year, 60%; and (b) with respect to Eligible
Receivables, 80%; PROVIDED, HOWEVER, that the Agent may, in its
reasonable discretion, following a field examination and based on its
analysis of potential factors arising after the date hereof that may
dilute the value of Eligible Collateral, revise from time to time the
percentage of the value of any individual item of Eligible Collateral
that shall be used in determining Loan Value.
"MARGIN STOCK" has the meaning specified in Regulation U.
"MATERIAL ADVERSE CHANGE" means, with respect to Brands, the
Borrower or, prior to the Second Merger, the Surviving Corporation, any
material adverse change in the business, condition (financial or
otherwise), operations, performance, properties or prospects of such
Loan Party and its Subsidiaries, taken as a whole.
"MATERIAL ADVERSE EFFECT" means, with respect to Brands, the
Borrower or, prior to the Second Merger, the Surviving Corporation, any
material adverse effect on (a) the business, condition (financial or
otherwise), operations, performance, properties or prospects of such
Loan Party and its Subsidiaries, taken as a whole, (b) the rights and
remedies of the Agent, any Lender, the Swing Line Bank, the Issuing
Bank or any Existing Issuing Bank under any Loan Document or any
Related Document or (c) the ability of such Loan Party to perform its
Obligations under any Loan Document or Related Document to which it is
or is to be a party.
"MERGER AGREEMENT" has the meaning specified in the
Preliminary Statements to this Agreement.
"MERGERS" has the meaning specified in the Preliminary
Statements to this Agreement.
"MONTHLY ROLLING PERIOD" means (a) with respect to any fiscal
month ending prior to September 1, 1995, the period commencing on the
date of the initial Borrowing and ending on the last day of such fiscal
month and (b) with respect to any fiscal month ending thereafter, such
fiscal month and the 11 immediately preceding fiscal months.
"MORTGAGE POLICIES" has the meaning specified in Section
5.01(p).
"MORTGAGES" has the meaning specified in Section 5.01(p).
"MR. COFFEE" has the meaning specified in the Preliminary
Statements to this Agreement.
"MULTIEMPLOYER PLAN" means, with respect to any Person, a
multiemployer plan, as defined in Section 4001(a)(3) of ERISA, to which
such Person or any of its ERISA Affiliates is making or accruing
22
17
an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions.
"MULTIPLE EMPLOYER PLAN" means, with respect to any Person, a
single employer plan, as defined in Section 4001(a)(15) of ERISA, that
(a) is maintained for employees of such Person or any of its ERISA
Affiliates and at least one Person other than such Person and its ERISA
Affiliates or (b) was so maintained and in respect of which such Person
or any of its ERISA Affiliates could have liability under Section 4064
or 4069 of ERISA in the event such plan has been or were to be
terminated.
"NET CASH PROCEEDS" means, with respect to any sale, lease,
transfer or other disposition of any asset or the incurrence or
issuance of any Indebtedness or capital stock, any securities
convertible into or exchangeable for capital stock or any warrants,
rights or options to acquire capital stock by any Person, the aggregate
amount of cash received from time to time by or on behalf of such
Person in connection with such transaction after deducting therefrom
only (a) reasonable and customary registration fees, brokerage
commissions, underwriting fees and discounts, legal fees, finder's fees
and other similar fees and commissions, (b) the amount of taxes payable
in connection with or as a result of such transaction, (c) the amount
of any Indebtedness secured by a Lien on such asset that, by the terms
of such transaction, is required to be repaid upon such sale, lease,
transfer or other disposition and (d) other reasonable and customary
costs and expenses ordinarily incurred and paid by a seller, lessor,
transferor or issuer, as the case may be, in each case to the extent,
but only to the extent, that the amounts so deducted are, at the time
of receipt of such cash, actually paid to a Person that is not an
Affiliate (other than payments to Brands required under the Tax Sharing
Agreement) and are properly attributable to such transaction or to the
asset that is the subject thereof.
"NET WORTH" means, at any date of determination, an amount
equal to the sum of (i) $46,000,000 and (ii) cumulative Consolidated
net income (or net loss) of the Borrower and its Subsidiaries
commencing on September 28, 1997.
"NEW SUBSIDIARY" has the meaning specified in Section 5.02(i).
"NONRECURRING CAPITAL EXPENDITURES" means, for fiscal years
1997 and 1998, an aggregate amount of Capital Expenditures not to
exceed $4,000,000 related solely to (i) the upgrade of existing
management information systems, (ii) the analysis, design and
implementation of new management information systems and (iii)
leasehold improvements at the new corporate headquarters and new
manufacturing, assembly and warehouse facility of Brands and its
Subsidiaries located at 0000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxx.
"NON-RECURRING RESTRUCTURING AND RELOCATION CHARGES" means,
for fiscal year 1997, an aggregate amount of relocation and severance
expenses not to exceed $2,875,000 before income taxes ($1,782,500 net
of income taxes) related solely to the (i) termination of the former
CEO and other management employees, (ii) relocation and compensation
expenses incurred with the installation of the new CEO, and (iii)
relocation expenses associated with the move to the new corporate
headquarters and new manufacturing, assembly and warehouse facility of
Brands and its subsidiaries located at 0000 Xxxxxxx Xxxx, Xxxxxxxxxx,
Xxxx.
"NOTE" means a Term Note or a Revolving Credit Note.
"NOTICE OF BORROWING" has the meaning specified in Section
2.02(a).
"NOTICE OF ISSUANCE" has the meaning specified in Section
2.13(b).
23
18
"NOTICE OF RENEWAL" has the meaning specified in Section
2.13(a).
"NOTICE OF SWING LINE BORROWING" has the meaning specified in
Section 2.02(f).
"OBLIGATION" means, with respect to any Person, any obligation
of such Person of any kind, including, without limitation, any
liability of such Person on any claim, whether or not the right of any
creditor to payment in respect of such claim is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, disputed,
undisputed, legal, equitable, secured or unsecured, and whether or not
such claim is discharged, stayed or otherwise affected by any
proceeding referred to in Section 6.01(e). Without limiting the
generality of the foregoing, the Obligations of the Loan Parties under
the Loan Documents include (a) the obligation to pay principal,
interest, commissions, charges, expenses, fees, attorneys' fees and
disbursements, indemnities and other amounts payable by any Loan Party
under any Loan Document and (b) the obligation to reimburse any amount
in respect of any of the foregoing that any Lender, in its sole
discretion, may elect to pay or advance on behalf of such Loan Party.
"OECD" means the Organization for Economic Cooperation and
Development.
"OPEN YEAR" has the meaning specified in Section 4.01(y).
"OTHER TAXES" has the meaning specified in Section 2.11(b).
"PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT" has the
meaning specified in Section 3.01(n) and shall include any patent,
trademark and copyright security agreement entered into by any Person
pursuant to Section 5.02(i), in each case as amended, supplemented or
otherwise modified from time to time.
"PBGC" means the Pension Benefit Guaranty Corporation.
"PERMITTED ENCUMBRANCES" has the meaning specified in the
Mortgages.
"PERMITTED LIENS" means such of the following as to which no
enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced:
(a) Liens for taxes, assessments and governmental
charges or levies to the extent not required to be paid under
Section 5.01(b) hereof or Section 6 of the Brands Guaranty;
(b) Liens imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's Liens and
other similar Liens arising in the ordinary course of business
securing obligations that (i) are not overdue for a period of
more than 30 days and (ii) either individually or when
aggregated with all other Permitted Liens outstanding on any
date of determination, do not materially affect the use or
value of the property to which they relate;
(c) pledges or deposits to secure obligations under
workers' compensation laws or similar legislation or to secure
public or statutory obligations; and
(d) easements, rights of way and other encumbrances
on title to real property that do not render title to the
property encumbered thereby unmarketable or materially
adversely affect the use of such property for its present
purposes.
24
19
"PERSON" means an individual, partnership, corporation
(including a business trust), joint stock company, trust,
unincorporated association, joint venture or other entity, or a
government or any political subdivision or agency thereof.
"PLAN" means a Single Employer Plan or a Multiple Employer
Plan.
"PLEDGED INDEBTEDNESS" has the meaning specified in the
Security Agreement.
"PLEDGED SHARES" has the meaning specified in the Security
Agreement.
"PREFERRED STOCK" means, with respect to any corporation,
capital stock issued by such corporation that is entitled to a
preference or priority over any other capital stock issued by such
corporation upon any distribution of such corporation's assets, whether
by dividend or upon liquidation.
"PRO RATA SHARE" of any amount means, with respect to any
Lender at any time, the product of (a) a fraction the numerator of
which is the amount of such Lender's Revolving Credit Commitment at
such time and the denominator of which is the Revolving Credit Facility
at such time and (b) such amount.
"QUARTERLY ROLLING PERIOD" means, with respect to any fiscal
quarter, such fiscal quarter and the three immediately preceding fiscal
quarters.
"RECEIVABLES" has the meaning specified in the Security
Agreement.
"REDEEMABLE" means, with respect to any Preferred Stock, any
such Preferred Stock that (a) the issuer has undertaken to redeem at a
fixed or determinable date or dates, whether by operation of a sinking
fund or otherwise, or upon the occurrence of a condition not solely
within the control of the issuer or (b) is redeemable at the option of
the holder.
"REGISTER" has the meaning specified in Section 8.07(c).
"REGULATION U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time.
"RELATED DOCUMENTS" means the Merger Agreement, the Tax
Sharing Agreement, Subordinated Notes Documents, the Signature Merger
Documents, the Assumption Agreement and the Warrant Agreement.
"REQUIRED LENDERS" means, at any time, Lenders owed or holding
in the aggregate greater than 66-2/3% of the sum of (a) the aggregate
unpaid principal amount of the Advances outstanding at such time, (b)
the aggregate Available Amount of all Letters of Credit outstanding at
such time and (c) the aggregate unused Commitments under the Term
Facility and the aggregate Unused Revolving Credit Commitments at such
time; PROVIDED, HOWEVER, that, if any Lender shall be a Defaulting
Lender at such time, there shall be excluded from the determination of
Required Lenders at such time (i) unless such Lender is timely
contesting in good faith the Defaulted Advances or Defaulted Amounts of
such Defaulting Lenders, the aggregate principal amount of the Advances
made by such Lender and outstanding at such time, (ii) such Lender's
pro rata portion of the aggregate Available Amount of all Letters of
Credit outstanding at such time and (iii) the unused Term Commitment
and the Unused Revolving Credit Commitment of such Lender at such time.
"REVOLVING CREDIT ADVANCE" has the meaning specified in
Section 2.01(b).
25
20
"REVOLVING CREDIT BORROWING" means a borrowing consisting of
simultaneous Revolving Credit Advances made by the Revolving Credit
Lenders.
"REVOLVING CREDIT COMMITMENT" means, with respect to any
Revolving Credit Lender at any time, the amount set forth opposite such
Revolving Credit Lender's name on Schedule I hereto under the caption
"Revolving Credit Commitment" or, if such Revolving Credit Lender has
entered into one or more Assignments and Acceptances, the amount set
forth for such Revolving Credit Lender in the Register maintained by
the Agent pursuant to Section 8.07(c) as such Revolving Credit Lender's
"Revolving Credit Commitment", as such amount may be reduced at or
prior to such time pursuant to Section 2.04.
"REVOLVING CREDIT FACILITY" means, at any time, the aggregate
amount of the Revolving Credit Lenders' Revolving Credit Commitments at
such time.
"REVOLVING CREDIT LENDER" means any Lender that has a
Revolving Credit Commitment.
"REVOLVING CREDIT NOTE" means a promissory note of the
Borrower payable to the order of any Lender, in substantially the form
of Exhibit A-2 hereto, evidencing the aggregate indebtedness of the
Borrower to such Lender resulting from the Revolving Credit Advances
and the Letter of Credit Advances made by such Lender.
"ROLLING PERIOD" means a Monthly Rolling Period or a Quarterly
Rolling Period, as the case may be.
"SECOND MERGER" has the meaning specified in the Preliminary
Statements to this Agreement.
"SECOND MERGER CERTIFICATE" has the meaning specified in the
Preliminary Statements to this Agreement.
"SECURED OBLIGATIONS" has the meaning specified in the
Security Agreement.
"SECURITY AGREEMENT" has the meaning specified in Section
3.01(n) and shall include any security agreement entered into by any
Person pursuant to Section 5.02(i), in each case as such agreement may
be amended, supplemented or otherwise modified from time to time in
accordance with its terms and this Agreement.
"SIGNATURE" means Signature Brands, Inc., an Ohio corporation
and wholly-owned subsidiary of Brands.
"SIGNATURE MERGER DOCUMENTS" means the certificate of merger
and the Agreement and Plan of Merger effecting the merger of the
Borrower into Signature, together with any and all other documents
executed in connection therewith.
"SINGLE EMPLOYER PLAN" means, with respect to any Person, a
single employer plan, as defined in Section 4001(a)(15) of ERISA, that
(a) is maintained for employees of such Person or any of its ERISA
Affiliates and no Person other than such Person and its ERISA
Affiliates or (b) was so maintained and in respect of which such Person
or any of its ERISA Affiliates could have liability under Section 4069
of ERISA in the event such plan has been or were to be terminated.
"SOLVENT" and "SOLVENCY" mean, with respect to any Person on
any date of determination, that on such date (a) the fair value of the
property of such Person is greater than the total amount of
liabilities,
26
21
including, without limitation, contingent liabilities, of such Person,
(b) the present fair saleable value of the assets of such Person is not
less than the amount that will be required to pay the probable
liability of such Person on its debts as they become absolute and
matured, (c) such Person does not intend to, and does not believe that
it will, incur debts or liabilities beyond such Person's ability to pay
as such debts and liabilities mature and (d) such Person is not engaged
in business or in a transaction, and is not about to engage in business
or in a transaction, for which such Person's property would constitute
unreasonably small capital.
"STANDBY LETTER OF CREDIT" means any Letter of Credit other
than a Trade Letter of Credit.
"SUBORDINATED NOTES" means the 13% Senior Subordinated Notes
Due 2002 of the Borrower in an aggregate principal amount of up to
$70,000,000 issued pursuant to the Indenture.
"SUBORDINATED NOTES DOCUMENTS" means the Indenture and all
other agreements, documents and instruments pursuant to which the
Subordinated Notes are issued.
"SUBSIDIARY" of any Person means any corporation, partnership,
joint venture, trust or estate of which (or in which) more than 50% of
(a) the issued and outstanding capital stock having ordinary voting
power to elect a majority of the Board of Directors of such corporation
(irrespective of whether at the time capital stock of any other class
or classes of such corporation shall or might have voting power upon
the occurrence of any contingency), (b) the interest in the capital or
profits of such partnership or joint venture or (c) the beneficial
interest in such trust or estate, is at the time directly or indirectly
owned or controlled by such Person, by such Person and one or more of
its other Subsidiaries or by one or more of such Person's other
Subsidiaries.
"SUBSIDIARIES' GUARANTY" has the meaning specified in Section
3.01(n) and shall include any guaranty entered into by any Person
pursuant to Section 5.02(i), in each case as such guaranty may be
amended, supplemented or otherwise modified from time to time in
accordance with its terms and with this Agreement.
"SURVIVING CORPORATION" has the meaning specified in the
Preliminary Statements to this Agreement.
"SURVIVING INDEBTEDNESS" has the meaning specified in Section
3.01(g).
"SWING LINE ADVANCE" means an advance made by (a) the Swing
Line Bank pursuant to Section 2.01(c) or (b) any Revolving Credit
Lender pursuant to Section 2.02(f).
"SWING LINE BANK" has the meaning specified in the recital of
parties to this Agreement.
"SWING LINE BORROWING" means a borrowing consisting of a Swing
Line Advance made by the Swing Line Bank.
"SWING LINE FACILITY" has the meaning specified in Section
2.01(c).
"'SYNDICATION AGENT' means BNP.
"TAX SHARING AGREEMENT" means the Agreement for the Allocation
of Federal Income Tax Liability and Benefits among Members of
Xxx-Continental Corp. (n/k/a Signature Brands USA, Inc.) Consolidated
27
22
Group dated as of April 28, 1988, as amended, supplemented or otherwise
modified through the date hereof.
"TAXES" has the meaning specified in Section 2.11(a).
"TERM ADVANCE" has the meaning specified in Section 2.01(a).
"TERM BORROWING" means a borrowing consisting of simultaneous
Term Advances of the same Type made by the Term Lenders.
"TERM COMMITMENT" means, with respect to any Term Lender at
any time, the amount set forth opposite such Term Lender's name on
Schedule I hereto under the caption "Term Commitment" or, if such Term
Lender has entered into one or more Assignments and Acceptances, the
amount set forth for such Term Lender in the Register maintained by the
Agent pursuant to Section 8.07(c) as such Term Lender's "Term
Commitment".
"TERM FACILITY" means, at any time, the aggregate amount of
the Term Lenders' Term Commitments at such time.
"TERM LENDER" means any Lender that has a Term Commitment.
"TERM NOTE" means a promissory note of the Borrower payable to
the order of any Lender, in substantially the form of Exhibit A-1
hereto, evidencing the indebtedness of the Borrower to such Lender
resulting from the Term Advance made by such Lender.
"TERMINATION DATE" means the earlier of August 15, 2001 and
the date of termination in whole of all Commitments pursuant to Section
2.04 or 6.01.
"TRADE LETTER OF CREDIT" means any Letter of Credit issued for
the benefit of a supplier of Inventory to the Borrower or any of its
Subsidiaries to effect payment for such Inventory.
"TYPE" refers to the distinction between Advances bearing
interest at the Base Rate and Advances bearing interest at the
Eurodollar Rate.
"UNUSED REVOLVING CREDIT COMMITMENT" means, with respect to
any Revolving Credit Lender at any time, (a) such Lender's Revolving
Credit Commitment at such time MINUS (b) the sum of (i) the aggregate
principal amount of all Revolving Credit Advances, Letter of Credit
Advances and Swing Line Advances made by such Lender (in its capacity
as a Lender) and outstanding at such time, PLUS (ii) such Lender's Pro
Rata Share of (A) the aggregate Available Amount of all Letters of
Credit outstanding at such time, (B) the aggregate principal amount of
all Letter of Credit Advances made by the Issuing Bank pursuant to
Section 2.13(c) and outstanding at such time and (C) the aggregate
principal amount of all Swing Line Advances made by the Swing Line Bank
pursuant to Section 2.01(c) and outstanding at such time.
"VOTING STOCK" means capital stock issued by a corporation, or
equivalent interests in any other Person, the holders of which are
ordinarily, in the absence of contingencies, entitled to vote for the
election of directors (or persons performing similar functions) of such
Person, even though the right so to vote has been suspended by the
happening of such a contingency.
28
23
"WARRANT AGREEMENT" means the Warrant Agreement dated as of
August 17, 1994 by and between Brands and American Bank National
Association, as Warrant Agent.
"WELFARE PLAN" means, with respect to any Person, a welfare
plan, as defined in Section 3(1) of ERISA.
"WITHDRAWAL LIABILITY" has the meaning specified in Part I of
Subtitle E of Title IV of ERISA.
SECTION 1.02. COMPUTATION OF TIME PERIODS. In this Agreement,
in the computation of periods of time from a specified date to a later specified
date, the word "from" means "from and including" and the words "to" and "until"
both mean "to but excluding".
SECTION 1.03. ACCOUNTING TERMS. All accounting terms not
specifically defined herein shall be construed in accordance with generally
accepted accounting principles consistent with those applied in the preparation
of the financial statements referred to in Section 4.01(f) or, with respect to
the determination of Eligible Inventory, of the Borrowing Base Report, ("GAAP").
ARTICLE II
AMOUNTS AND TERMS OF THE ADVANCES AND LETTERS OF CREDIT
SECTION 2.01. THE ADVANCES. (a) THE TERM ADVANCES. Each Term
Lender severally agrees, on the terms and conditions hereinafter set forth, to
make a single advance (together with any other advance made pursuant to this
Section 2.01(a), a "TERM ADVANCE") to the Borrower from the date hereof until
August 19, 1994 in an amount not to exceed such Term Lender's Term Commitment.
Each Term Lender that has agreed to make a Term Advance based on such Term
Lender's Increased Term Commitment severally agrees, on the terms and conditions
set forth in Amendment No. 9, to made a single advance (such advance becoming a
Term Advance) to the Borrower on the effective date of Amendment No. 9 pursuant
to Section 2 thereof in an amount not to exceed such Term Lender's Increased
Term Commitment. Amounts borrowed under this Section 2.01(a) and repaid or
prepaid may not be reborrowed.
(b) THE REVOLVING CREDIT ADVANCES. Each Revolving Credit
Lender severally agrees, on the terms and conditions hereinafter set forth, to
make advances ("REVOLVING CREDIT ADVANCES") to the Borrower from time to time on
any Business Day during the period from the date hereof until the Termination
Date in an amount for each such Revolving Credit Advance not to exceed such
Revolving Credit Lender's Unused Revolving Credit Commitment on such Business
Day. Each Revolving Credit Borrowing shall be in an aggregate amount of $500,000
or an integral multiple of $200,000 in excess thereof and shall consist of
Revolving Credit Advances made by the Revolving Credit Lenders ratably according
to their Revolving Credit Commitments. Within the limits of each Revolving
Credit Lender's Unused Revolving Credit Commitment in effect from time to time,
the Borrower may borrow under this Section 2.01(b), prepay pursuant to Section
2.05(a) and reborrow under this Section 2.01(b).
(c) THE SWING LINE ADVANCES. The Borrower may request the Swing Line
Bank to make, and the Swing Line Bank agrees (so long as its obligations
hereunder are not amended or modified without its consent) to make, on the terms
and conditions hereinafter set forth, Swing Line Advances to the Borrower from
time to time on any Business Day during the period from the date hereof until
the Termination Date (i) in an aggregate amount not to exceed at any time
outstanding $3,000,000 (the "SWING LINE FACILITY") and (ii) in an amount for
each such Swing Line Borrowing not to exceed the aggregate of the Unused
Revolving Credit Commitments of the Revolving Credit Lenders on such Business
Day. No Swing Line Advance shall be used for the purpose of funding the payment
of principal of any other Swing Line Advance. Each Swing Line Borrowing shall be
in an amount of
29
24
$250,000 or an integral multiple of $100,000 in excess thereof and shall consist
of a Base Rate Advance. Within the limits of the Swing Line Facility and within
the limits referred to in clause (ii) above, the Borrower may borrow under this
2.01(c), prepay pursuant to Section 2.05(a) and reborrow under this Section
2.01(c).
SECTION 2.02. MAKING THE ADVANCES. (a) Except as otherwise
provided in Section 2.02(f), each Borrowing shall be made on notice, given not
later than 11:00 A.M. (New York City time) on the first Business Day prior to
the date of the proposed Borrowing in the case of a Borrowing comprised of Base
Rate Advances and on the third Business Day prior to the date of the proposed
Borrowing in the case of a Borrowing comprised of Eurodollar Rate Advances, by
the Borrower to the Agent, which shall give to each Appropriate Lender prompt
notice thereof by telex, telecopier or cable. Each such notice of a Borrowing (a
"NOTICE OF BORROWING") shall be by telex, telecopier or cable, confirmed
immediately in writing, in substantially the form of Exhibit B hereto,
specifying therein the requested (i) date of such Borrowing, (ii) Facility under
which such Borrowing is to be made, (iii) Type of Advances comprising such
Borrowing, (iv) aggregate amount of such Borrowing and (v) in the case of a
Borrowing consisting of Eurodollar Rate Advances, initial Interest Period for
each such Advance. In the case of a proposed Borrowing comprised of Eurodollar
Rate Advances, the Agent shall promptly notify each Appropriate Lender of the
applicable interest rate under Section 2.06(a)(ii). Each Appropriate Lender
shall, before 11:00 A.M. (New York City time) on the date of such Borrowing,
make available for the account of its Applicable Lending Office to the Agent at
the Agent's Account, in same day funds, such Lender's ratable portion of such
Borrowing in accordance with the respective Commitments of such Lender and the
other Appropriate Lenders. After the Agent's receipt of such funds and upon
fulfillment of the applicable conditions set forth in Article III, the Agent
will make such funds available to the Borrower by crediting the Borrower's
Account; PROVIDED, HOWEVER, that, in the case of any Revolving Credit Borrowing,
the Agent shall first make a portion of such funds equal to the aggregate
principal amount of any Swing Line Advances made by the Swing Line Bank and
Letter of Credit Advances made by the Issuing Bank and any Existing Issuing
Banks and in each case by any Lenders and outstanding on the date of such
Revolving Credit Borrowing PLUS interest accrued and unpaid thereon to and as of
such date, available to the Swing Line Bank, the Issuing Bank, such Existing
Issuing Banks and/or such Lenders for repayment of such Swing Line Advances or
Letter of Credit Advances.
(b) Anything in Section 2.02(a) above to the contrary
notwithstanding, (i) the Borrower may not select Eurodollar Rate Advances for
the initial Borrowing hereunder or for any Borrowing if the aggregate amount of
such Borrowing is less than $1,000,000 or if the obligation of the Appropriate
Lenders to make Eurodollar Rate Advances shall then be suspended pursuant to
Section 2.09 and (ii) the Advances may not be outstanding as part of more than
eight separate Borrowings.
(c) Each Notice of Borrowing and each Notice of Swing Line
Borrowing shall be irrevocable and binding on the Borrower. In the case of any
Borrowing that the related Notice of Borrowing specifies is to be comprised of
Eurodollar Rate Advances, the Borrower shall indemnify each Appropriate Lender
against any loss, cost or expense incurred by such Lender as a result of any
failure to fulfill on or before the date specified in such Notice of Borrowing
the applicable conditions set forth in Article III, including, without
limitation, any loss (including loss of anticipated profits), cost or expense
incurred by reason of the liquidation or reemployment of deposits or other funds
acquired by such Lender to fund the Advance to be made by such Lender as part of
such Borrowing when such Advance, as a result of such failure, is not made on
such date.
(d) Unless the Agent shall have received notice from an
Appropriate Lender prior to the date of any Borrowing under a Facility under
which such Lender has a Commitment that such Lender will not make available to
the Agent such Lender's ratable portion of such Borrowing, the Agent may assume
that such Lender has made such portion available to the Agent on the date of
such Borrowing in accordance with subsection (a) of this Section 2.02 and the
Agent may, in reliance upon such assumption, make available to the Borrower on
such date a corresponding amount. If and to the extent that such Lender shall
not have so made such ratable portion available to the Agent, such Lender and
the Borrower severally agree to repay or to pay to the Agent forthwith on
30
25
demand such corresponding amount and to pay interest thereon, for each day from
the date such amount is made available to the Borrower until the date such
amount is repaid or paid to the Agent, at (i) in the case of the Borrower, the
interest rate applicable at such time under Section 2.06 to Advances comprising
such Borrowing and (ii) in the case of such Lender, the Federal Funds Rate. If
such Lender shall pay to the Agent such corresponding amount, such amount so
paid shall constitute such Lender's Advance as part of such Borrowing for
purposes of this Agreement.
(e) The failure of any Lender to make the Advance to be made
by it as part of any Borrowing shall not relieve any other Lender of its
obligation, if any, hereunder to make its Advance on the date of such Borrowing,
but no Lender shall be responsible for the failure of any other Lender to make
the Advance to be made by such other Lender on the date of any Borrowing.
(f) Each Swing Line Borrowing shall be made on notice, given not later
than 11:00 A.M. (New York City time) on the date of the proposed Swing Line
Borrowing, by the Borrower to the Swing Line Bank and the Agent. Each such
notice of a Swing Line Borrowing (a "NOTICE OF SWING LINE BORROWING") shall be
in writing, or by telex or telecopier, specifying therein the requested (i) date
of such Borrowing, (ii) amount of such Borrowing and (iii) maturity of such
Borrowing (which maturity shall be no later than the seventh day after the
requested date of such Borrowing). The Swing Line Bank will make the amount
thereof available to the Agent at the Agent's Account, in same day funds. After
the Agent's receipt of such funds and upon fulfillment of the applicable
conditions set forth in Article III, the Agent will make such funds available to
the Borrower by crediting the Borrower's Account. Upon written demand by the
Swing Line Bank, with a copy of such demand to the Agent, each other Revolving
Credit Lender shall purchase from the Swing Line Bank, and the Swing Line Bank
shall sell and assign to each such other Revolving Credit Lender, such other
Lender's Pro Rata Share of such outstanding Swing Line Advance as of the date of
such demand, by making available for the account of its Applicable Lending
Office to the Agent for the account of the Swing Line Bank, by deposit to the
Agent's Account, in same day funds, an amount equal to the portion of the
outstanding principal amount of such Swing Line Advance to be purchased by such
Lender. The Borrower hereby agrees to each such sale and assignment. Each
Revolving Credit Lender agrees to purchase its Pro Rata Share of an outstanding
Swing Line Advance on (i) the Business Day on which demand therefor is made by
the Swing Line Bank, PROVIDED that notice of such demand is given not later than
11:00 A.M. (New York City time) on such Business Day or (ii) the first Business
Day next succeeding such demand if notice of such demand is given after such
time. Upon any such assignment by the Swing Line Bank to any other Revolving
Credit Lender of a portion of a Swing Line Advance, the Swing Line Bank
represents and warrants to such other Lender that the Swing Line Bank is the
legal and beneficial owner of such interest being assigned by it, but makes no
other representation or warranty and assumes no responsibility with respect to
such Swing Line Advance, the Loan Documents or any Loan Party. If and to the
extent that any Revolving Credit Lender shall not have so made the amount of
such Swing Line Advance available to the Agent, such Revolving Credit Lender
agrees to pay to the Agent forthwith on demand such amount together with
interest thereon, for each day from the date of demand by the Swing Line Bank
until the date such amount is paid to the Agent, at the Federal Funds Rate. If
such Lender shall pay to the Agent such amount for the account of the Swing Line
Bank on any Business Day, such amount so paid in respect of principal shall
constitute a Swing Line Advance made by such Lender on such Business Day for
purposes of this Agreement, and the outstanding principal amount of the Swing
Line Advance made by the Swing Line Bank shall be reduced by such amount on such
Business Day.
SECTION 2.03. Repayment.
----------
(a) TERM ADVANCES. The Borrower shall repay to the Agent for the
ratable account of the Term Lenders the aggregate outstanding principal amount
of the Term Advances (including Term Advances made in respect of any Increased
Term Commitment) on the following dates in the amounts indicated (which amounts
shall be reduced as a result of the application of prepayments in accordance
with Section 2.05):
31
26
Date Amount
---- ------
December 31, 1997 $1,250,000
March 31, 1998 $1,250,000
June 30, 1998 $1,250,000
September 30, 1998 $1,250,000
December 31, 1998 $1,875,000
March 31, 1999 $1,875,000
June 30, 1999 $1,875,000
September 30, 1999 $1,875,000
December 31, 1999 $1,875,000
March 31, 2000 $4,200,000
June 30, 2000 $4,200,000
September 30, 2000 $4,200,000
December 31, 2000 $7,300,000
March 31, 2001 $7,300,000
June 30, 2001 $7,300,000
August 15, 2001 $11,125,000
PROVIDED, HOWEVER, that in the event that the EBITDA of the Borrower and its
Subsidiaries on a Consolidated basis for the fiscal year ended September 30,
1999 shall be less than $34,500,000, the installments due on March 31, June 30,
and September 30, 2000 shall be increased in each case from $4,200,000 to
$5,475,000 and the installment due on August 15, 2001 shall be reduced from
$11,125,000 to $7,300,000; and PROVIDED FURTHER, that the final installment
shall in any event be in an amount equal to the aggregate unpaid principal
amount of the Term Advances.
(b) REVOLVING CREDIT ADVANCES. The Borrower shall repay to the
Agent for the ratable account of the Revolving Credit Lenders the aggregate
outstanding principal amount of the Revolving Credit Advances on the Termination
Date.
(c) LETTER OF CREDIT ADVANCES. The Borrower shall repay to the
Agent for the account of the Issuing Bank, for the account of each Existing
Issuing Bank and for the ratable account of each Lender that has made a Letter
of Credit Advance the outstanding principal amount of each Letter of Credit
Advance made by each of them on demand.
(d) SWING LINE ADVANCES. The Borrower hereby agrees to repay to the
Agent, for the account of the Swing Line Bank and each other Revolving Credit
Lender which has made a Swing Line Advance to it, the outstanding principal
amount of each Swing Line Advance made by each of them on the earlier of the
maturity date specified in the applicable Notice of Swing Line Borrowing (which
maturity shall be no later than the seventh day after the requested date of such
Borrowing) and the Termination Date.
SECTION 2.04. REDUCTION OF THE COMMITMENTS. (a) OPTIONAL. The
Borrower may, upon at least five Business Days' notice to the Agent, permanently
terminate in whole or permanently reduce in part, the Swing Line Facility or the
Unused Revolving Credit Commitments of the Lenders without premium or penalty;
PROVIDED, HOWEVER, that each partial reduction of the Revolving Credit Facility
(i) shall be in an aggregate amount of
32
27
$1,000,000 or an integral multiple of $500,000 in excess thereof and (ii) shall
be made ratably among the Revolving Credit Lenders in accordance with their
Revolving Credit Commitments.
(b) MANDATORY. (i) The Revolving Credit Facility shall be
automatically and permanently reduced on the date on which any prepayment is
required to be made pursuant to Section 2.05(b) by (A) an amount equal to (1)
the aggregate amount of Excess Cash Flow required to be used to prepay Advances
under Section 2.05(b)(i) LESS (2) the amount of any Excess Cash Flow required to
be used to prepay the Term Advances pursuant to Section 2.05(b)(i) and (B) any
Net Cash Proceeds in excess of the amount required to prepay the Term Advances
pursuant to Section 2.05(b)(ii).
(ii) The Letter of Credit Facility shall be automatically and
permanently reduced on each date on which the Revolving Credit Facility is
reduced under Section 2.04(a) or Section 2.04(b)(i) by the amount, if any, by
which the Letter of Credit Facility on such date EXCEEDS the Revolving Credit
Facility on such date (after giving effect to any reduction of the Revolving
Credit Facility under Section 2.04(a) or Section 2.04(b)(i), as the case may be,
on such date).
SECTION 2.05. PREPAYMENTS. (a) OPTIONAL. The Borrower may,
upon one Business Day's notice to the Agent, stating the proposed date and the
aggregate principal amount of the prepayment, and if such notice is given the
Borrower shall, prepay, without premium or penalty, the aggregate principal
amount of the Advances comprising part of the same Borrowings in whole or
ratably in part, together with accrued interest to the date of such prepayment
on the aggregate principal amount prepaid unless such prepayment is with respect
to a Revolving Credit Advance which is a Base Rate Advance; PROVIDED, HOWEVER,
that (i) each partial prepayment (other than a prepayment of Swing Line
Advances) shall be in an aggregate principal amount of $500,000 or an integral
multiple of $200,000 in excess thereof (or, with respect to Swing Line Advances,
shall be in an aggregate principal amount of $250,000 or an integral multiple of
$100,000 in excess thereof) and (ii) no such prepayment of a Eurodollar Rate
Advance shall be made other than on the last day of an Interest Period therefor.
Each such prepayment of the Term Advances shall be applied to the principal
repayment installments thereof in inverse order of maturity.
(b) MANDATORY. (i) The Borrower shall, no later than the 30th
day following the date on which it delivers the financial statements referred to
in Section 5.03(d) (but in any event within 120 days after the end of each
fiscal year of the Borrower), for the period beginning the date hereof and
ending December 31, 1994, prepay an aggregate principal amount of the Advances
comprising part of the same Borrowings equal to 50% of the amount of Excess Cash
Flow for such period in excess of $4,500,000 and thereafter, prepay an aggregate
principal amount of the Advances comprising part of the same Borrowings equal to
50% of the amount of Excess Cash Flow for such fiscal year. Each such prepayment
of any Advances shall be applied FIRST, to the Term Facility and pro rata to the
principal repayment installments thereof payable during the period beginning
December 31, 1997 and ending August 15, 2001, SECOND, to the extent of any Term
Advances then remaining outstanding, to the Term Facility and pro rata to the
remaining principal repayment installments thereof and THIRD, to the extent that
no Term Advances remain outstanding, to permanently reduce the Revolving Credit
Facility.
(ii) Except as provided in Section 5.02(h)(ii), the Borrower
shall, no later than one Business Day after the date of receipt of the Net Cash
Proceeds from (A) the sale, lease, transfer or other disposition of any assets
of Brands or any of its Subsidiaries (other than sales of assets in the ordinary
course of business or pursuant to Section 5.02(e)(v)), (B) the incurrence or
issuance by Brands or any of its Subsidiaries of any Indebtedness and (C) the
sale or issuance by Brands or any of its Subsidiaries of any capital stock, any
securities convertible into or exchangeable for capital stock or any warrants,
rights or options to acquire capital stock, prepay an aggregate principal amount
of the Advances comprising part of the same Borrowings equal to the amount of
such Net Cash Proceeds. Each such prepayment of any Advances shall be applied
FIRST, to the Term Facility and to the principal
33
28
repayment installments thereof in inverse order of maturity and SECOND, to the
extent that no Term Advances remain outstanding, to permanently reduce the
Revolving Credit Facility.
(iii) The Borrower shall, on each Business Day, pay to the
Agent for deposit in the L/C Cash Collateral Account an amount sufficient to
cause the aggregate amount on deposit in such L/C Cash Collateral Account to
equal 105% of the amount by which the aggregate Available Amount of all Letters
of Credit then outstanding exceeds the Letter of Credit Facility on such
Business Day.
(iv) Prepayments of the Revolving Credit Facility made
pursuant to clause (i) or (ii) above or clause (v) below shall be FIRST applied
to prepay Letter of Credit Advances then outstanding until such Advances are
paid in full, SECOND applied to prepay Swing Line Advances then outstanding
until such Advances are paid in full, THIRD applied to prepay Revolving Credit
Advances then outstanding comprising part of the same Borrowings (in the order
designated by the Borrower) until such Advances are paid in full and FOURTH
deposited in the L/C Cash Collateral Account to cash collateralize 105% of the
Available Amount of the Letters of Credit then outstanding; and, in the case of
prepayments of the Revolving Credit Facility required pursuant to clause (i) or
(ii) above, the Revolving Credit Facility shall be permanently reduced as set
forth in Section 2.04(b)(i). Upon the drawing of any Letter of Credit for which
funds are on deposit in the L/C Cash Collateral Account, such funds shall be
applied to reimburse the Issuing Bank or Revolving Credit Lenders, as
applicable.
(v) The Borrower shall, on each Business Day, prepay an
aggregate principal amount of the Revolving Credit Advances equal to the amount
by which (A) the sum of (1) the aggregate principal amount of the Revolving
Credit Advances then outstanding, (2) the aggregate principal amount of the
Swing Line Advances and the Letter of Credit Advances then outstanding and (3)
the Available Amount of all Letters of Credit then outstanding exceeds (B) the
lesser of (1) the Revolving Credit Facility on such Business Day and (2) the
Loan Value of Eligible Collateral on such Business Day.
(vi) All prepayments under this Section 2.05(b) shall be made
together with accrued interest to the date of such prepayment on the principal
amount prepaid.
(vii) The Swing Line Facility shall be permanently reduced
from time to time on the date of each reduction in the Revolving Credit Facility
by the amount, if any, by which the amount of the Swing Line Facility exceeds
the Revolving Credit Facility after giving effect to such reduction of the
Revolving Credit Facility.
(c) APPLICATION OF COMMITMENT REDUCTIONS. Upon each reduction
of any Facility (other than the Letter of Credit Facility) pursuant to this
Section 2.05, the Commitment of each Lender under such Facility shall be reduced
by such Lender's Pro Rata Share of the amount by which such Facility is reduced.
SECTION 2.06. INTEREST. (a) SCHEDULED INTEREST. The Borrower
shall pay interest on the unpaid principal amount of each Advance owing to each
Lender from the date of such Advance until such principal amount shall be paid
in full at the following rates per annum:
(i) BASE RATE ADVANCES. During such periods as such Advance is
a Base Rate Advance, a rate per annum equal at all times to the sum of
(i) the Base Rate in effect from time to time PLUS (ii) the Applicable
Margin in effect from time to time, payable quarterly in arrears on the
last day of each September, December, March and June during such
periods, commencing on September 30, 1994, and on the date such Base
Rate Advance shall be Converted or on the Termination Date.
(ii) EURODOLLAR RATE ADVANCES. During such periods as such
Advance is a Eurodollar Rate Advance, a rate per annum equal at all
times during each Interest Period for such Advance to the sum of (i)
the Eurodollar Rate for such Interest Period for such Advance PLUS (ii)
the Applicable Margin in effect
34
29
on the first day of such Interest Period, payable in arrears on the
last day of such Interest Period and, if such Interest Period has a
duration of more than three months, on each day that occurs during such
Interest Period every three months from the first day of such Interest
Period.
(b) DEFAULT INTEREST. Upon the occurrence and during the
continuance of an Event of Default or a Default with respect to any event
described in Section 6.01(e), the Borrower shall pay interest on (i) the unpaid
principal amount of each Advance owing to each Lender, payable in arrears on the
dates referred to in clause (a)(i) or (a)(ii) above and on demand, at a rate per
annum equal at all times to 2% per annum above the rate per annum required to be
paid on such Advance pursuant to clause (a)(i) or (a)(ii) above and (ii) the
amount of any interest, fee or other amount payable hereunder that is not paid
when due, from the date such amount shall be due until such amount shall be paid
in full, payable in arrears on the date such amount shall be paid in full and on
demand, at a rate per annum equal at all times to 2% per annum above the rate
per annum required to be paid on Base Rate Advances pursuant to clause (a)(i)
above.
SECTION 2.07. FEES. (a) COMMITMENT FEE. The Borrower shall pay
to the Agent for the account of the Lenders a commitment fee on each Appropriate
Lender's average daily Unused Revolving Credit Commitment from the date hereof
in the case of each Bank and from the effective date specified in the Assignment
and Acceptance pursuant to which it became a Lender in the case of each other
Lender until the Termination Date at the rate of 1/2 of 1% per annum, payable in
arrears quarterly on the last day of each September, December, March and June,
commencing on September 30, 1994, and on the Termination Date; PROVIDED,
HOWEVER, that any commitment fee accrued with respect to the Commitment of a
Defaulting Lender during the period occurring prior to the time such Lender
became a Defaulting Lender and unpaid at such time shall not be payable by the
Borrower so long as such Lender shall be a Defaulting Lender, except to the
extent that such commitment fee shall otherwise have been due and payable prior
to such time; PROVIDED FURTHER, HOWEVER, that no commitment fee shall accrue on
the Commitment of a Defaulting Lender so long as such Lender shall be a
Defaulting Lender.
(b) LETTER OF CREDIT COMMISSION, ETC. (i) The Borrower shall
pay to the Agent, for the account of each Lender, a commission on such Lender's
Pro Rata Share of the average daily aggregate Available Amount of all Letters of
Credit outstanding from time to time at the rate per annum equal to 2.50%,
payable in arrears quarterly on the last Business Day of each September,
December, March and June, commencing September 30, 1994, and on the Termination
Date; PROVIDED, HOWEVER, that any commission accrued with respect to the Pro
Rata Share of a Defaulting Lender during the period occurring prior to the time
such Lender became a Defaulting Lender and unpaid at such time shall not be
payable by the Borrower so long as such Lender shall be a Defaulting Lender,
except to the extent that such commission shall otherwise have been due and
payable prior to such time; PROVIDED FURTHER, HOWEVER, that no commission shall
accrue on the Pro Rata Share of a Defaulting Lender so long as such Lender shall
be a Defaulting Lender.
(ii) The Borrower shall pay to the Issuing Bank and each
Existing Issuing Bank, for its own account, such issuance fees, fronting fees,
transfer fees and other fees and charges in connection with the issuance or
administration of each Letter of Credit as the Borrower and the Issuing Bank or
such Existing Issuing Bank shall agree.
(c) AGENT'S FEES. The Borrower shall pay to the Agent for its
own account such fees as may from time to time be agreed upon between the
Borrower and the Agent.
SECTION 2.08. CONVERSION OF ADVANCES. (a) OPTIONAL. The
Borrower may on any Business Day, upon notice given to the Agent not later than
11:00 A.M. (New York City time) on the third Business Day prior to the date of
the proposed Conversion and subject to the provisions of Section 2.09, Convert
all or any portion of the Advances (other than Letter of Credit Advances) of one
Type comprising the same Borrowing into Advances of the other Type; PROVIDED,
HOWEVER, that any Conversion of Eurodollar Rate Advances into Base Rate
35
30
Advances shall be made on, and only on, the last day of an Interest Period for
such Eurodollar Rate Advances, any Conversion of Base Rate Advances into
Eurodollar Rate Advances shall be in an amount not less than the minimum amount
specified in Section 2.02(b), and no Conversion of any Advance shall result in
more separate Borrowings than permitted under Section 2.02(b). Each such notice
of Conversion shall, within the restrictions specified above, specify (i) the
date of such Conversion, (ii) the Advances to be Converted and (iii) if such
Conversion is into Eurodollar Rate Advances, the duration of the initial
Interest Period for such Advances. Each notice of Conversion shall be
irrevocable and binding on the Borrower.
(b) MANDATORY. (i) On the date on which the aggregate unpaid
principal amount of Eurodollar Rate Advances comprising any Borrowing shall be
reduced, by payment or prepayment or otherwise, to less than $1,000,000, such
Eurodollar Rate Advances shall automatically Convert into Base Rate Advances.
(ii) If the Borrower shall fail to select the duration of any
Interest Period for any Eurodollar Rate Advances in accordance with the
provisions contained in the definition of "INTEREST PERIOD" in Section 1.01, the
Agent will forthwith so notify the Borrower and the Appropriate Lenders,
whereupon each such Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance.
SECTION 2.09. INCREASED COSTS, ETC. (a) If, due to either (i)
the introduction of or any change in or in the interpretation of any law or
regulation or (ii) the compliance with any guideline or request from any central
bank or other governmental authority (whether or not having the force of law),
there shall be any increase in the cost to any Lender, the Swing Line Bank, the
Issuing Bank or any Existing Issuing Bank of agreeing to make or of making,
funding or maintaining Eurodollar Rate Advances or of agreeing to make or of
making, funding or maintaining Letter of Credit Advances, or of the Issuing Bank
agreeing to issue or issuing or maintaining Letters of Credit or of such
Existing Issuing Bank maintaining Letters of Credit, then the Borrower shall
from time to time, upon demand by such Lender, the Issuing Bank or such Existing
Issuing Bank (with a copy of such demand to the Agent), pay to the Agent for the
account of such Lender, the Issuing Bank or such Existing Issuing Bank
additional amounts sufficient to compensate such Lender for such increased cost;
PROVIDED, HOWEVER, that the Borrower shall be obligated to make such payment
only if such Lender, the Issuing Bank or such Existing Issuing Bank has given,
or has caused the Agent to give, notice to the Borrower of the facts or
circumstances giving rise to such increased cost within 60 days after such
Lender, the Issuing Bank or such Existing Issuing Bank shall have itself
received actual knowledge thereof. A certificate as to the amount of such
increased cost, submitted to the Borrower by such Lender, the Issuing Bank or
such Existing Issuing Bank, shall be conclusive and binding for all purposes,
absent manifest error.
(b) If any Lender or the Issuing Bank determines that
compliance with any law or regulation or any guideline or request from any
central bank or other governmental authority (whether or not having the force of
law) affects or would affect the amount of capital required or expected to be
maintained by such Lender or the Issuing Bank or any corporation controlling
such Lender or the Issuing Bank and that the amount of such capital is increased
by or based upon the existence of such Lender's commitment to lend hereunder or
the Issuing Bank's commitment to issue Letters of Credit hereunder and other
commitments of such type, then, upon demand by such Lender or the Issuing Bank
(with a copy of such demand to the Agent), the Borrower shall pay to the Agent
for the account of such Lender or the Issuing Bank, from time to time as
specified by such Lender or the Issuing Bank, additional amounts sufficient to
compensate such Lender or the Issuing Bank or such controlling corporation in
the light of such circumstances, to the extent that such Lender or the Issuing
Bank or such controlling corporation reasonably determines such increase in
capital to be allocable to the existence of such Lender's commitment to lend
hereunder or the Issuing Bank's commitment to issue Letters of Credit hereunder;
PROVIDED that such additional amounts shall not include compensation for any
additional amounts arising from circumstances occurring more than 180 days prior
to the date of such demand. A certificate as to such amounts, submitted to the
Borrower by such Lender or the Issuing Bank, shall be conclusive and binding for
all purposes, absent manifest error.
36
31
(c) If, with respect to any Eurodollar Rate Advances, Lenders
owed at least 66-2/3% of the then aggregate unpaid principal amount thereof
notify the Agent that the Eurodollar Rate for any Interest Period for such
Eurodollar Rate Advances will not adequately reflect the cost to such Lenders of
making, funding or maintaining their Eurodollar Rate Advances for such Interest
Period, the Agent shall forthwith so notify the Borrower and the Lenders,
whereupon (i) each Eurodollar Rate Advance will automatically, on the last day
of the then existing Interest Period therefor, Convert into a Base Rate Advance
and (ii) the obligation of such Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended until the Agent shall notify the
Borrower that such Lenders have determined that the circumstances causing such
suspension no longer exist.
(d) Notwithstanding any other provision of this Agreement, if
the introduction of or any change in or in the interpretation of any law or
regulation shall make it unlawful, or any central bank or other governmental
authority shall assert that it is unlawful, for any Lender or its Eurodollar
Lending Office to perform its obligations hereunder to make Eurodollar Rate
Advances or to continue to fund or maintain Eurodollar Rate Advances hereunder,
then, on notice thereof and demand therefor by such Lender to the Borrower
through the Agent, (i) each Eurodollar Rate Advance will automatically, upon
such demand, Convert into a Base Rate Advance and (ii) the obligation of the
Lenders to make, or to Convert Advances into, Eurodollar Rate Advances shall be
suspended until the Agent shall notify the Borrower that such Lender has
determined that the circumstances causing such suspension no longer exist.
(e) Upon the occurrence and during the continuance of any
Default, (i) each Eurodollar Rate Advance will automatically, on the last day of
the then existing Interest Period therefor, Convert into a Base Rate Advance and
(ii) the obligation of the Lenders to make, or to Convert Advances into,
Eurodollar Rate Advances shall be suspended.
SECTION 2.10. PAYMENTS AND COMPUTATIONS. (a) The Borrower
shall make each payment hereunder and under the Notes not later than 11:00 A.M.
(New York City time) on the day when due in U.S. dollars to the Agent at the
Agent's Account in same day funds. Any payment received by the Agent after such
time shall be deemed to have been received by the Agent on the next Business
Day. The Agent will promptly thereafter cause like funds to be distributed (i)
if such payment by the Borrower is in respect of principal, interest, commitment
fees or any other Obligation then due and payable hereunder or under any of the
Notes to more than one Lender, to such Lenders for the account of their
respective Applicable Lending Offices ratably in accordance with the amounts of
such respective Obligations then due and payable to such Lenders and (ii) if
such payment by the Borrower is in respect of any Obligation then due and
payable hereunder or under any of the Notes to one Lender, to such Lender for
the account of its Applicable Lending Office, in each case to be applied in
accordance with the terms of this Agreement. Upon its acceptance of an
Assignment and Acceptance and recording of the information contained therein in
the Register pursuant to Section 8.07(c), from and after the effective date of
such Assignment and Acceptance, the Agent shall make all payments hereunder and
under the Note or Notes in respect of the interest assigned thereby to the
Lender assignee thereunder, and the parties to such Assignment and Acceptance
shall make all appropriate adjustments in such payments for periods prior to
such effective date directly between themselves.
(b) If the Agent receives funds for application to the
Obligations under the Loan Documents under circumstances for which the Loan
Documents do not specify the Advances or the Facility to which, or the manner in
which, such funds are to be applied, the Agent may, but shall not be obligated
to, elect to distribute such funds to each Lender ratably in accordance with
such Lender's proportionate share of the principal amount of all outstanding
Advances, in repayment or prepayment of such of the outstanding Advances or
other Obligations owed to such Lender, and for application to such principal
installments, as the Agent shall direct.
(c) The Borrower hereby authorizes each Lender, the Swing Line
Bank, the Issuing Bank and each Existing Issuing Bank, if and to the extent
payment owed to such Lender, the Swing Line Bank, the Issuing
37
32
Bank or such Existing Issuing Bank is not made when due hereunder or under the
Note or Notes held by such Lender, the Swing Line Bank, the Issuing Bank or such
Existing Issuing Bank, to charge from time to time against any or all of the
Borrower's accounts with such Lender, the Swing Line Bank, the Issuing Bank or
such Existing Issuing Bank any amount so due.
(d) All computations of interest, fees and commissions shall
be made by the Agent on the basis of a year of 360 days, in each case for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest or fees are payable. Each
determination by the Agent of an interest rate, fee or commission hereunder
shall be conclusive and binding for all purposes, absent manifest error.
(e) Whenever any payment hereunder or under the Notes shall be
stated to be due on a day other than a Business Day, such payment shall be made
on the next succeeding Business Day, and such extension of time shall in such
case be included in the computation of payment of interest or commitment fee, as
the case may be; PROVIDED, HOWEVER, that, if such extension would cause payment
of interest on or principal of Eurodollar Rate Advances to be made in the next
following calendar month, such payment shall be made on the immediately
preceding Business Day.
(f) Unless the Agent shall have received notice from the
Borrower prior to the date on which any payment is due to any Lender, the Swing
Line Bank, the Issuing Bank or any Existing Issuing Bank hereunder or under the
Notes that the Borrower will not make such payment in full, the Agent may assume
that the Borrower has made such payment in full to the Agent on such date and
the Agent may, in reliance upon such assumption, cause to be distributed to such
Lender, the Swing Line Bank, the Issuing Bank or such Existing Issuing Bank on
such due date an amount equal to the amount then due such Lender, the Swing Line
Bank, the Issuing Bank or such Existing Issuing Bank. If and to the extent the
Borrower shall not have so made such payment in full to the Agent, such Lender,
the Swing Line Bank, the Issuing Bank or such Existing Issuing Bank shall repay
to the Agent forthwith on demand such amount distributed to such Lender, the
Swing Line Bank, the Issuing Bank or such Existing Issuing Bank together with
interest thereon, for each day from the date such amount is distributed to such
Lender, the Swing Line Bank, the Issuing Bank or such Existing Issuing Bank
until the date such Lender, the Swing Line Bank, the Issuing Bank or such
Existing Issuing Bank repays such amount to the Agent, at the Federal Funds
Rate.
SECTION 2.11. TAXES. (a) Any and all payments by the Borrower
hereunder or under the Notes shall be made, in accordance with Section 2.10,
free and clear of and without deduction for any and all present or future taxes,
levies, imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, EXCLUDING, in the case of each Lender, the Swing Line Bank, the
Issuing Bank, each Existing Issuing Bank and the Agent, net income taxes that
are imposed by the United States and franchise taxes and net income taxes that
are imposed on such Lender, the Swing Line Bank, the Issuing Bank, such Existing
Issuing Bank or the Agent by the state or foreign jurisdiction under the laws of
which such Lender, the Swing Line Bank, the Issuing Bank, such Existing Issuing
Bank or the Agent, as the case may be, is organized or any political subdivision
thereof and, in the case of each Lender, the Swing Line Bank, the Issuing Bank
and each Existing Issuing Bank, franchise taxes and net income taxes that are
imposed on such Lender, the Swing Line Bank, the Issuing Bank or such Existing
Issuing Bank by the state or foreign jurisdiction of such Lender's Applicable
Lending Office or any political subdivision thereof (all such nonexcluded taxes,
levies, imposts, deductions, charges, withholdings and liabilities being
hereinafter referred to as "TAXES"). If the Borrower shall be required by law to
deduct any Taxes from or in respect of any sum payable hereunder or under any
Note to any Lender, the Swing Line Bank, the Issuing Bank, any Existing Issuing
Bank or the Agent, (i) the sum payable shall be increased as may be necessary so
that after making all required deductions (including deductions applicable to
additional sums payable under this Section 2.11), such Lender, the Swing Line
Bank, the Issuing Bank, such Existing Issuing Bank or the Agent, as the case may
be, receives an amount equal to the sum it would have received had no such
deductions been made, (ii) the Borrower
38
33
shall make such deductions and (iii) the Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law.
(b) In addition, the Borrower agrees to pay any present or
future stamp, documentary, excise, property or similar taxes, charges or levies
that arise from any payment made hereunder or under the Notes or from the
execution, delivery or registration of, or otherwise with respect to, this
Agreement, the Notes or any Letter of Credit or any other agreement or document
(including, without limitation, any other Loan Document) entered into in
connection herewith, or any transaction contemplated hereby (hereinafter
referred to as "OTHER TAXES").
(c) The Borrower will indemnify each Lender, the Swing Line
Bank, the Issuing Bank, each Existing Issuing Bank and the Agent for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction on amounts payable under this Section
2.11) paid by such Lender, the Swing Line Bank, the Issuing Bank, such Existing
Issuing Bank or the Agent, as the case may be, and any liability (including,
without limitation, penalties, additions to tax, interest and expenses) arising
therefrom or with respect thereto. This indemnification shall be made within 30
days from the date such Lender, the Swing Line Bank, the Issuing Bank, such
Existing Issuing Bank or the Agent, as the case may be, makes written demand
therefor.
(d) Within 30 days after the date of any payment of Taxes, the
Borrower will furnish to the Agent, at its address referred to in Section 8.02,
the original receipt of payment thereof or a certified copy of such receipt. In
the case of any payment hereunder or under the Notes by the Borrower through an
account or branch outside the United States or on behalf of the Borrower by a
payor that is not a United States person, if the Borrower determines that no
Taxes are payable in respect thereof, the Borrower will furnish, or will cause
such payor to furnish, to the Agent, at such address, an opinion of counsel
acceptable to the Agent stating that such payment is exempt from Taxes. For
purposes of this Section 2.11(d) and Section 2.11(e), the terms "UNITED STATES"
and "UNITED STATES PERSON" shall have the meanings specified in Section 7701 of
the Internal Revenue Code.
(e) Each Lender organized under the laws of a jurisdiction
outside the United States shall, on or prior to the date of its execution and
delivery of this Agreement in the case of each Bank, and on the date of the
Assignment and Acceptance pursuant to which it became a Lender in the case of
each other Lender, and from time to time thereafter if requested in writing by
the Borrower or the Agent (but only so long thereafter as such Lender remains
lawfully able to do so), provide the Agent and the Borrower with Internal
Revenue Service form 1001 or 4224, as appropriate (or any successor form
prescribed by the Internal Revenue Service), certifying that such Lender is
entitled to benefits under an income tax treaty to which the United States is a
party that reduces the rate of withholding tax on payments under this Agreement
or the Notes or certifying that the income receivable pursuant to this Agreement
or the Notes is effectively connected with the conduct of a trade or business in
the United States. If the form provided by a Lender at the time such Lender
first becomes a party to this Agreement indicates a United States interest
withholding tax rate in excess of zero, withholding tax at such rate shall be
considered excluded from Taxes unless and until such Lender provides the
appropriate form certifying that a lesser rate applies, whereupon withholding
tax at such lesser rate only shall be considered excluded from Taxes for periods
governed by such form; PROVIDED, HOWEVER, that, if at the date of the Assignment
and Acceptance pursuant to which a Lender assignee becomes a party to this
Agreement, the Lender assignor was entitled to payments under Section 2.11(a) in
respect of United States withholding tax with respect to interest paid at such
date, then, to the extent such tax results in liability for such payments, the
term "TAXES" shall include (in addition to withholding taxes that may be imposed
in the future or other amounts otherwise includable in Taxes) United States
interest withholding tax, if any, applicable with respect to the Lender assignee
on such date. If any form or document referred to in this Section 2.11(e)
requires the disclosure of information, other than information necessary to
compute the tax payable and information required on the date hereof by Internal
Revenue Service form 1001 or 4224, that the Lender reasonably considers to be
confidential, the Lender shall give notice thereof to the Borrower and shall not
be obligated to include in such form or document such confidential information.
39
34
(f) For any period with respect to which a Lender has failed
to provide the Borrower with the appropriate form described in Section 2.11(e)
above (OTHER THAN if such failure is due to a change in law occurring after the
date on which a form originally was required to be provided or if such form
otherwise is not required under Section 2.11(e) above), such Lender shall not be
entitled to indemnification under Section 2.11(a) or 2.11(c) with respect to
Taxes imposed by the United States; PROVIDED, HOWEVER, that should a Lender
become subject to Taxes because of its failure to deliver a form required
hereunder, the Borrower shall take such steps as such Lender shall reasonably
request to assist such Lender in recovering such Taxes.
(g) Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 2.11 shall survive the payment in full of principal
and interest hereunder and under the Notes.
SECTION 2.12. SHARING OF PAYMENTS, ETC. If any Lender shall
obtain at any time any payment (whether voluntary, involuntary, through the
exercise of any right of setoff, or otherwise) on account of (a) Obligations due
and payable to such Lender hereunder and under the Notes at such time in excess
of its ratable share (according to the proportion of (i) the amount of such
Obligations due and payable to such Lender at such time to (ii) the aggregate
amount of the Obligations due and payable to all Lenders hereunder and under the
Notes at such time) of payments on account of the Obligations due and payable to
all Lenders hereunder and under the Notes at such time obtained by all the
Lenders at such time or (b) Obligations owing (but not due and payable) to such
Lender hereunder and under the Notes at such time in excess of its ratable share
(according to the proportion of (i) the amount of such Obligations owing (but
not due and payable) to such Lender at such time to (ii) the aggregate amount of
Obligations owing (but not due and payable) to all Lenders hereunder and under
the Notes at such time) of payments on account of the Obligations owing (but not
due and payable) to all Lenders hereunder and under the Notes at such time
obtained by all Lenders at such time, such Lender shall forthwith purchase from
the other Lenders such participations in the Obligations due and payable or
owing to them, as the case may be, as shall be necessary to cause such
purchasing Lender to share the excess payment ratably with each of them;
PROVIDED, HOWEVER, that if all or any portion of such excess payment is
thereafter recovered from such purchasing Lender, such purchase from each other
Lender shall be rescinded and such other Lender shall repay to the purchasing
Lender the purchase price to the extent of such other Lender's ratable share
(according to the proportion of (A) the purchase price paid to such Lender to
(B) the aggregate purchase price paid to all Lenders) of such recovery together
with an amount equal to such Lender's ratable share (according to the proportion
of (1) the amount of such other Lender's required repayment to (2) the total
amount so recovered from the purchasing Lender) of any interest or other amount
paid or payable by the purchasing Lender in respect of the total amount so
recovered. The Borrower agrees that any Lender so purchasing a participation
from another Lender pursuant to this Section 2.12 may, to the fullest extent
permitted by law, exercise all its rights of payment (including the right of
setoff) with respect to such participation as fully as if such Lender were the
direct creditor of the Borrower in the amount of such participation.
SECTION 2.13. LETTERS OF CREDIT. (a) THE LETTER OF CREDIT
FACILITY. (i) Effective as of the date of the initial Borrowing, the letters of
credit existing on the date thereof and listed on Schedule 2.13(a) hereto (the
"EXISTING LETTERS OF CREDIT"), which Schedule 2.13(a) shall include the issuer,
beneficiary, account party, number, date of issuance and expiry date of each
Existing Letter of Credit and the available amount outstanding thereunder, shall
be deemed to be outstanding under this Agreement.
(ii) The Issuing Bank agrees, on the terms and conditions
hereinafter set forth, to issue additional letters of credit (together with the
Existing Letters of Credit, the "LETTERS OF CREDIT") for the account of the
Borrower from time to time on any Business Day during the period from the date
of the initial Borrowing until 30 days before the Termination Date (A) in an
aggregate Available Amount for all Letters of Credit issued by the Issuing Bank
at any time outstanding, together with all Existing Letters of Credit then
outstanding, not to exceed at any time the Letter of Credit Commitment and (B)
in an Available Amount for each such Letter of Credit not to exceed the Unused
Revolving Credit Commitments of the Revolving Credit Lenders on such Business
Day. No
40
35
Letter of Credit shall have an expiration date (including all rights of the
Borrower or the beneficiary to require renewal) later than the earlier of (1)
the scheduled Termination Date and (2)(x) in the case of a Standby Letter of
Credit, one year after the date of issuance thereof (but such Standby Letter of
Credit may by its terms be automatically renewable annually upon notice (a
"NOTICE OF RENEWAL") given to the Issuing Bank and the Agent on or prior to any
date for notice of renewal set forth in such Letter of Credit (but in any event
at least five Business Days prior to the date of the proposed renewal of such
Standby Letter of Credit) and upon fulfillment of the applicable conditions set
forth in Article III unless the Issuing Bank has notified the Borrower (with a
copy to the Agent) on or prior to any date for notice of termination set forth
in such Letter of Credit (but in any event at least ten business days prior to
the date of automatic renewal of such Standby Letter of Credit) of its election
not to renew such Standby Letter of Credit (a "NOTICE OF TERMINATION")) and (y)
in the case of a Trade Letter of Credit, 180 days after the date of issuance
thereof; PROVIDED that the terms of each Standby Letter of Credit that is
automatically renewable annually shall (A) require the Issuing Bank to give the
beneficiary named in such Standby Letter of Credit prompt notice of any Notice
of Termination and (B) permit such beneficiary, upon receipt of such Notice of
Termination, to draw under such Standby Letter of Credit at any time prior to
the date such Standby Letter of Credit otherwise would have been automatically
renewed. If either a Notice of Renewal is not given by the Borrower or a Notice
of Termination is given by the Issuing Bank pursuant to the immediately
preceding sentence, such Standby Letter of Credit shall expire on the date it
otherwise would have been automatically renewed. Within the limits of the Letter
of Credit Facility and subject to the limits referred to above, the Borrower may
request the issuance of Letters of Credit under this Section 2.13(a), repay any
Letter of Credit Advances resulting from drawings thereunder pursuant to Section
2.13(c) and request the issuance of additional Letters of Credit under this
Section 2.13(b). Notwithstanding anything herein to the contrary, each Letter of
Credit which is an Existing Letter of Credit shall not be renewed after the
expiry date set forth on Schedule 2.13(a) hereto for such Existing Letter of
Credit.
(b) REQUEST FOR ISSUANCE. (i) Each Letter of Credit shall be
issued upon notice, given not later than 11:00 A.M. (New York City time) on the
one Business Day prior to the date of the proposed issuance of such Letter of
Credit, by the Borrower to the Issuing Bank, which shall give the Agent and each
Revolving Credit Lender prompt notice thereof by telex or telecopier. Each such
notice of issuance of a Letter of Credit (a "NOTICE OF ISSUANCE") shall be by
telex or telecopier, confirmed immediately in writing, specifying therein the
requested (A) date of such issuance (which shall be a Business Day), (B)
Available Amount of such Letter of Credit, (C) expiration date of such Letter of
Credit, (D) name and address of the beneficiary of such Letter of Credit and (E)
form of such Letter of Credit, and shall be accompanied by such application and
agreement for a letter of credit (collectively, a "LETTER OF CREDIT AGREEMENT")
as the Issuing Bank may specify to the Borrower for use in connection with such
requested Letter of Credit. If (1) the requested form of such Letter of Credit
is acceptable to the Issuing Bank in its reasonable discretion and (2) it has
not received a notice of objection from Lenders holding at least 66- 2/3% of the
Revolving Credit Facility, the Issuing Bank, upon fulfillment of the applicable
conditions set forth in Article III, will make such Letter of Credit available
to the Borrower at its address referred to in Section 8.02 or as otherwise
agreed with the Borrower in connection with such issuance. In the event and to
the extent that the provisions of any Letter of Credit Agreement shall conflict
with this Agreement, the provisions of this Agreement shall govern.
(ii) The Issuing Bank and the Existing Issuing Bank shall furnish (A)
to the Agent on the first Business Day of each week, a written report
summarizing issuance and expiration dates of Letters of Credit issued by the
Issuing Bank or such Existing Issuing Bank during the previous week and drawings
during such week under all Letters of Credit issued by the Issuing Bank or such
Existing Issuing Bank and (B) to the Agent and each Revolving Credit Lender on
the first Business Day of each calendar quarter, a written report setting forth
the average daily aggregate Available Amount of all Letters of Credit issued by
the Issuing Bank and the Existing Issuing Bank during the immediately preceding
calendar quarter, and copies of all such reports shall be furnished promptly to
the Borrower.
41
36
(c) DRAWING AND REIMBURSEMENT. The payment by the Issuing Bank
or any Existing Issuing Bank of a draft drawn under any Letter of Credit shall
constitute for all purposes of this Agreement the making by the Issuing Bank or
such Existing Issuing Bank of an Advance (a "LETTER OF CREDIT ADVANCE"), which
shall be a Base Rate Advance, in the amount of such draft. In the event of any
drawing under a Letter of Credit, the Issuing Bank or such Existing Issuing Bank
shall, promptly notify the Agent, and the Agent shall promptly notify each
Revolving Credit Lender and each Revolving Credit Lender shall purchase from the
Issuing Bank or such Existing Issuing Bank, and the Issuing Bank or such
Existing Issuing Bank shall sell and assign to each Revolving Credit Lender,
such Lender's Pro Rata Share of each outstanding Letter of Credit Advance as of
the date of such purchase, by making available for the account of its Applicable
Lending Office to the Agent at the Agent's Account for the account of the
Issuing Bank or such Existing Issuing Bank, in same day funds, an amount equal
to the portion of the outstanding principal amount of such Letter of Credit
Advance to be purchased by such Lender. The Borrower hereby agrees to each such
sale and assignment. Each Revolving Credit Lender agrees to purchase its Pro
Rata Share of an outstanding Letter of Credit Advance on (i) the Business Day on
which demand therefor is made by the Issuing Bank or such Existing Issuing Bank;
PROVIDED that notice of such demand is given not later than 11:00 A.M. (New York
City time) on such Business Day or (ii) the first Business Day next succeeding
such demand if notice of such demand is given after such time. Upon any such
assignment by the Issuing Bank or such Existing Issuing Bank to any Revolving
Credit Lender of a portion of a Letter of Credit Advance, the Issuing Bank
represents and warrants to such Lender that the Issuing Bank or such Existing
Issuing Bank is the legal and beneficial owner of such interest being assigned
by it, but makes no other representation or warranty and assumes no
responsibility with respect to such Letter of Credit Advance, the Loan Documents
or any Loan Party. If and to the extent that any Revolving Credit Lender shall
not have so made the amount of such Letter of Credit Advance available to the
Agent, such Revolving Credit Lender agrees to pay to the Agent forthwith on
demand such corresponding amount and to pay interest thereon, for each day from
the date of demand by the Issuing Bank or such Existing Issuing Bank until the
date such amount is paid to the Agent, at the Federal Funds Rate. If such
Revolving Credit Lender shall pay to the Agent such corresponding amount for the
account of the Issuing Bank or such Existing Issuing Bank on any Business Day,
such amount so paid in respect of principal shall constitute a Letter of Credit
Advance made by such Revolving Credit Lender on such Business Day for purposes
of this Agreement, and the outstanding principal amount of the Letter of Credit
Advance made by the Issuing Bank or such Existing Issuing Bank shall be reduced
by such amount on such Business Day.
(d) SEVERAL OBLIGATIONS OF THE REVOLVING CREDIT LENDERS. The
failure of any Revolving Credit Lender to make a Letter of Credit Advance on the
date of demand therefor by the Issuing Bank or any Existing Issuing Bank shall
not relieve any other Revolving Credit Lender of its obligation hereunder to
make its Letter of Credit Advance on the date of such demand, but no Revolving
Credit Lender shall be responsible for the failure of any other Revolving Credit
Lender to make the Letter of Credit Advance to be made by such other Revolving
Credit Lender on the date of such demand.
(e) OBLIGATIONS ABSOLUTE. The Obligations of the Borrower
under this Agreement, any Letter of Credit Agreement, any Letter of Credit and
any other agreement or instrument relating to any Letter of Credit
(collectively, the "L/C RELATED DOCUMENTS") shall be unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of such L/C
Related Document under all circumstances, including, without limitation, the
following circumstances:
(i) any lack of validity or enforceability of any of the L/C
Related Documents;
(ii) any change in the time, manner or place of payment of, or
in any other term of, all or any of the Obligations of the Borrower in
respect of any L/C Related Document or any other amendment or waiver of
or any consent to departure from all or any of the L/C Related
Documents;
42
37
(iii) the existence of any claim, setoff, defense or other
right that the Borrower may have at any time against any beneficiary or
any transferee of a Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Bank,
any Existing Issuing Bank or any other Person, whether in connection
with any transaction contemplated by the L/C Related Documents or any
unrelated transaction;
(iv) any statement or any other document presented under a
Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(v) payment by the Issuing Bank or any Existing Issuing Bank
under a Letter of Credit against presentation of a draft or certificate
that does not strictly comply with the terms of such Letter of Credit;
(vi) any exchange, release or nonperfection of any Collateral
or other collateral, or any release or amendment or waiver of or
consent to departure from the Brands Guaranty or any other guaranty,
for all or any of the Obligations of the Borrower in respect of the L/C
Related Documents; or
(vii) any other circumstance or happening whatsoever, whether
or not similar to any of the foregoing, including, without limitation,
any other circumstance that might otherwise constitute a defense
available to, or a discharge of, the Borrower or a guarantor.
SECTION 2.14. DEFAULTING LENDERS. (a) In the event that, at
any time, (i) any Lender shall be a Defaulting Lender, (ii) such Defaulting
Lender shall owe a Defaulted Advance to the Borrower and (iii) the Borrower
shall be required to make any payment hereunder or under any other Loan Document
to or for the account of such Defaulting Lender, then the Borrower may, so long
as no Default shall occur and be continuing at such time and to the fullest
extent permitted by applicable law, set off and otherwise apply the Obligation
of the Borrower to make such payment to or for the account of such Defaulting
Lender against the Obligation of such Defaulting Lender to make such Defaulted
Advance. In the event that the Borrower shall so set off and otherwise apply the
Obligation of the Borrower to make any such payment against the Obligation of
such Defaulting Lender to make any such Defaulted Advance on any date, the
amount so set off and otherwise applied by the Borrower shall constitute for all
purposes of this Agreement and the other Loan Documents an Advance by such
Defaulting Lender made on the date of such setoff and application. Such Advance
shall be a Base Rate Advance and shall be considered, for all purposes of this
Agreement, to comprise part of the Borrowing in connection with which such
Defaulted Advance was originally required to have been made pursuant to Section
2.01(a), even if the other Advances comprising such Borrowing shall be
Eurodollar Rate Advances on the date such Advance is deemed to be made pursuant
to this Section 2.14(a). The Borrower shall notify the Agent at any time the
Borrower reduces the amount of the Obligation of the Borrower to make any
payment otherwise required to be made by it hereunder or under any other Loan
Document as a result of the exercise by the Borrower of its right set forth in
this Section 2.14(a) and shall specify in such notice (A) the name of the
Defaulting Lender and the Defaulted Advance required to be made by such
Defaulting Lender and (B) the amount set off and otherwise applied in respect of
such Defaulted Advance pursuant to this Section 2.14(a). Any portion of such
payment otherwise required to be made by the Borrower to or for the account of
such Defaulting Lender that is paid by the Borrower, after giving effect to the
amount set off and otherwise applied by the Borrower pursuant to this Section
2.14(a), shall be applied by the Agent as specified in Section 2.14(b) or
2.14(c).
(b) In the event that, at any time, (i) any Lender shall be a
Defaulting Lender, (ii) such Defaulting Lender shall owe a Defaulted Amount to
the Agent, any other Lenders, the Issuing Bank or any Existing Issuing Banks and
(iii) the Borrower shall make any payment hereunder or under any other Loan
Document to the Agent for the account of such Defaulting Lender, then the Agent
may, on its behalf or on behalf of such other Lenders, the Issuing Bank or such
Existing Issuing Banks and to the fullest extent permitted by applicable law,
apply
43
38
at such time the amount so paid by the Borrower to or for the account of such
Defaulting Lender to the payment of each such Defaulted Amount to the extent
required to pay such Defaulted Amount. In the event that the Agent shall so
apply any such amount to the payment of any such Defaulted Amount on any date,
the amount so applied by the Agent shall constitute for all purposes of this
Agreement and the other Loan Documents payment to such extent of such Defaulted
Amount on such date. Any such amount so applied by the Agent shall be retained
by the Agent or distributed by the Agent to such other Lender, the Issuing Bank
and such Existing Issuing Banks, ratably in accordance with the respective
portions of such Defaulted Amounts payable at such time to the Agent, such
Lenders, the Issuing Bank and such Existing Issuing Banks and, if the amount of
such payment made by the Borrower shall at any time be insufficient to pay all
Defaulted Amounts owing at such time to the Agent, the other Lenders, the
Issuing Bank and the Existing Issuing Banks, in the following order of priority:
(A) FIRST, to the Agent for any Defaulted Amounts owing to the
Agent (solely in its capacity as Agent) at such time;
(B) SECOND, to the Issuing Bank and the Existing Issuing Banks
for any Defaulted Amounts owing to the Issuing Bank and the Existing
Issuing Banks (solely in their capacity as Issuing Bank and Existing
Issuing Banks) at such time ratably in accordance with such respective
Defaulted Amounts owing to the Issuing Bank and each Existing Issuing
Bank (solely in their capacity as Issuing Bank and Existing Issuing
Banks) at such time; and
(C) THIRD, to the other Lenders for any Defaulted Amounts
owing to the other Lenders (solely in their capacity as Lenders) at
such time, ratably in accordance with such respective Defaulted Amounts
owing to each other Lender (solely in its capacity as a Lender) at such
time.
Any portion of such payment made by the Borrower for the account of such
Defaulting Lender remaining, after giving effect to the amount applied by the
Agent pursuant to this Section 2.14(b), shall be applied by the Agent as
specified in Section 2.14(c).
(c) In the event that, at any time, (i) any Lender shall be a
Defaulting Lender, (ii) such Defaulting Lender shall not owe a Defaulted Advance
or a Defaulted Amount and (iii) the Borrower, the Agent, any other Lender, the
Issuing Bank or any Existing Issuing Bank shall be required to pay or to
distribute any amount hereunder (including, without limitation, a Letter of
Credit Advance) or under any other Loan Document to or for the account of such
Defaulting Lender, then the Borrower, such other Lender, the Issuing Bank or
such Existing Issuing Bank shall pay such amount to the Agent to be held by the
Agent, to the fullest extent permitted by applicable law, in escrow or the Agent
shall, to the fullest extent permitted by applicable law, hold in escrow such
amount otherwise held by it. Any funds held by the Agent in escrow under this
Section 2.14(c) shall be deposited by the Agent in an account with BNP, in the
name and under the control of the Agent, but subject to the provisions of this
Section 2.14(c). The terms applicable to such account, including the rate of
interest payable with respect to the credit balance of such account from time to
time, shall be BNP's standard terms applicable to escrow accounts maintained
with it. Any interest credited to such account from time to time shall be held
by the Agent in escrow under, and applied by the Agent from time to time in
accordance with the provisions of, this Section 2.14(c). The Agent shall, to the
fullest extent permitted by applicable law, apply all funds so held in escrow
from time to time to the extent necessary to make any Advances required to be
made by such Defaulting Lender and to pay any amount payable by such Defaulting
Lender hereunder (including, without limitation, a Letter of Credit Advance) and
under the other Loan Documents to the Agent, any other Lender, the Issuing Bank
or any Existing Issuing Bank, as and when such Advances or such amounts are
required to be made or paid and, if the amount so held in escrow shall at any
time be insufficient to make and pay all such Advances and all such amounts
required to be made or paid at such time, in the following order of priority:
44
39
(A) FIRST, to the Agent for any amounts due and payable by
such Defaulting Lender to the Agent hereunder and under the other Loan
Documents (solely in its capacity as Agent) at such time;
(B) SECOND, to the Issuing Bank and the Existing Issuing Banks
for any amounts due and payable by such Defaulting Lender to the
Issuing Bank and the Existing Issuing Banks hereunder and under the
other Loan Documents (solely in their capacity as Issuing Bank and
Existing Issuing Banks) at such time ratably in accordance with such
respective amounts due and payable to the Issuing Bank and each
Existing Issuing Bank (solely in their capacity as Issuing Bank and
Existing Issuing Banks) at such time;
(C) THIRD, to the other Lenders for any amounts due and
payable by such Defaulting Lender to the other Lenders hereunder and
under the other Loan Documents (solely in their capacity as Lenders) at
such time, ratably in accordance with such respective amounts due and
payable to each other Lender (solely in its capacity as a Lender) at
such time; and
(D) FOURTH, to the Borrower for any Revolving Advances
required to be made by such Defaulting Lender pursuant to the Revolving
Commitment of such Defaulting Lender at such time.
In the event that such Defaulting Lender shall, at any time, cease to be a
Defaulting Lender, any funds held by the Agent in escrow at such time with
respect to such Defaulting Lender shall be distributed by the Agent to such
Defaulting Lender and applied by such Defaulting Lender to the Obligations owing
to such Defaulting Lender at such time under this Agreement and the other Loan
Documents, ratably in accordance with the respective amounts of such Obligations
outstanding at such time.
(d) The rights and remedies against a Defaulting Lender under
this Section 2.14 are in addition to other rights and remedies that the Borrower
may have against such Defaulting Lender with respect to any Defaulted Advance
and that the Agent, any other Lender, the Issuing Bank or any Existing Issuing
Bank may have against such Defaulting Lender with respect to any Defaulted
Amount.
SECTION 2.15. USE OF PROCEEDS. The proceeds of the Advances
(other than Letter of Credit Advances) shall be available (and the Borrower
agrees that it shall use such proceeds) solely to finance in part the Mergers,
to pay transaction fees and expenses in connection with the Mergers and the
other transactions contemplated hereby, to refinance certain existing credit
facilities of Signature and Mr. Coffee and to provide working capital and letter
of credit support for the Borrower and its Subsidiaries. The proceeds of Term
Advances made in respect of Increased Term Commitments shall be applied to pay
fees and expenses of the Borrower associated with Amendment No. 9 to this Credit
Agreement and for other general corporate purposes.
ARTICLE III
CONDITIONS OF LENDING
SECTION 3.01. CONDITIONS PRECEDENT TO INITIAL BORROWING. The
obligation of each Lender to make an Advance or the Issuing Bank to issue a
Letter of Credit on the occasion of the initial Borrowing is subject to the
following conditions precedent:
(a) Mr. Coffee's Board of Directors shall have approved the
First Merger and recommended that its stockholders vote in favor of the
First Merger, and such recommendation shall not have been withdrawn or
qualified. Not more than 15% of Mr. Coffee's stockholders (on a fully
diluted basis) shall be entitled to an appraisal under Section 262 of
the Delaware General Corporation Law.
45
40
(b) Each of the Related Documents shall have been executed and
delivered, shall be in full force and effect and shall not have been
terminated.
(c) The Lenders shall be satisfied with all legal, tax and
accounting matters, and shall be satisfied as to the Solvency, of each
of Brands and the Borrower after giving effect to the Mergers and the
other transactions contemplated hereby and thereby.
(d) The Lenders shall be satisfied with the corporate and
legal structure of each Loan Party, Mr. Coffee and Acquisition, both
before and after giving effect to the Mergers, including the terms and
conditions of the charter, bylaws and each class of capital stock of
each such Loan Party, Mr. Coffee and Acquisition and of each agreement
or instrument relating to such structure or capitalization.
(e) The Lenders shall be satisfied in their sole discretion
(i) with the terms and conditions of the committed equity and debt
financing, (ii) with the terms and conditions of the Subordinated Notes
and Subordinated Notes Documents and (iii) that the assets and earnings
of the Loan Parties immediately following the Mergers will be
sufficient (A) to secure the facilities and (B) to support the
Obligations of the Borrower under this Agreement and the Notes, the
Obligations of each Loan Party under the Loan Documents and the timely
amortization of all Indebtedness and other Obligations of each Loan
Party.
(f) The Lenders shall have received, with findings
satisfactory to the Lenders, such financial, business and other
information of Brands, Mr. Coffee and their Subsidiaries as they shall
have requested, and nothing shall have come to the attention of the
Lenders during the course of such review to lead them to believe that
(i) any written information, exhibit or report (including, without
limitation, any financial information) furnished by or on behalf of any
Loan Party, Mr. Coffee or any of their Subsidiaries to the Agent, any
Lender or the Issuing Bank was or has become misleading, incorrect or
incomplete in any material respect, (ii) following consummation of the
Mergers, the Borrower would not have good and marketable title to all
of the property and assets of Signature and Mr. Coffee or (iii)
consummation of the Mergers will have a Material Adverse Effect.
(g) The Lenders shall be satisfied that all of the
Indebtedness of Signature and Mr. Coffee, other than the Indebtedness
of Signature and Mr. Coffee set forth on Schedule 4.01(dd) hereto (the
"SURVIVING INDEBTEDNESS"), has been prepaid, redeemed or defeased in
full or otherwise satisfied and extinguished.
(h) Except the Disclosed Litigation, there shall exist no
action, suit, investigation, litigation or proceeding affecting any
Loan Party, Mr. Coffee, Acquisition or any of their properties
(including any Environmental Action) pending or threatened before any
court, governmental agency or arbitrator that (a) could have a Material
Adverse Effect or (b) purports to affect the legality, validity or
enforceability of the Mergers, this Agreement, any Note, any other Loan
Document, any Related Document or the consummation of the transactions
contemplated hereby or thereby.
(i) All material governmental and third party consents and
approvals necessary in connection with the Mergers and the related
financings and grants of security interests shall have been obtained
(without the imposition of any conditions other than those that are
acceptable to the Lenders) and shall remain in effect, and all
applicable waiting periods shall have expired without any action being
taken by any competent authority and no law or regulation shall be
applicable, in the judgment of the Lenders, that restrains, prevents or
imposes adverse conditions upon the Mergers or any of the other
transactions contemplated hereby or thereby.
46
41
(j) Before giving effect to the Mergers and the other
transactions contemplated by this Agreement, there shall have occurred
no Material Adverse Change since December 31, 1993 and no material
adverse change in the business, condition (financial or otherwise),
operations, performance, properties or prospects of Mr. Coffee since
December 26, 1993.
(k) Brands shall have received at least $19,000,000 (or bank
certified checks, bank drafts, cashier's checks or postal or
telegraphic money orders therefor) in gross proceeds from the issuance
and sale of its common stock.
(l) Signature and Brands shall have received at least
$70,000,000 in gross proceeds from the sale of the Subordinated Notes
and the sale of warrants in connection therewith.
(m) The Borrower shall have paid all accrued fees and expenses
(including any upfront fees) of the Agent, the Lenders and the Issuing
Bank (including the accrued reasonable and documented fees and expenses
of counsel).
(n) The Agent shall have received on or before the date of the
initial Borrowing the following, each dated such date (unless otherwise
specified), in form and substance satisfactory to the Lenders (unless
otherwise specified) and (except for the Notes) in sufficient copies
for each Lender:
(i) The Notes to the order of the Lenders, duly
executed by the Borrower.
(ii) Certified copies of the resolutions of the Board
of Directors of each Loan Party, Mr. Coffee and Acquisition
approving the Mergers, this Agreement, the Notes, each other
Loan Document and each Related Document to which it is or is
to be a party, and of all documents evidencing other necessary
corporate action and governmental approvals, if any, with
respect to the Mergers, this Agreement, the Notes, each other
Loan Document and each Related Document to which it is or is
to be a party.
(iii) A copy of the charter of each Loan Party, Mr.
Coffee and Acquisition and each amendment thereto, certified
(as of a date reasonably near the date of the initial
Borrowing) by the Secretary of State of the state of
incorporation of each such Person as being a complete and
correct copy thereof.
(iv) (A) A copy of a certificate of the Secretary of
State of the state of incorporation of each Loan Party, Mr.
Coffee and Acquisition (dated reasonably near the date of the
initial Borrowing), listing the charter of such Loan Party,
Mr. Coffee or Acquisition, as the case may be, and each
amendment thereto on file in his office and certifying that
(1) such amendments are the only amendments to such Loan
Party's, Mr. Coffee's or Acquisition's charter on file in his
office, (2) such Loan Party, Mr. Coffee or Acquisition has
paid all franchise taxes to the date of such certificate and
(3) such Loan Party, Mr. Coffee or Acquisition is duly
incorporated and in good standing under the laws of such state
and (B) a telegram or letter via telecopier from the Secretary
of State of the state of incorporation of each Loan Party, Mr.
Coffee and Acquisition certifying that such Loan Party, Mr.
Coffee or Acquisition, as the case may be, is duly
incorporated and in good standing under the laws of such state
on the date of the initial Borrowing.
(v) A copy of a certificate or certificates of (A)
the Secretaries of State of Illinois and Ohio (dated
reasonably near the date of the initial Borrowing), stating
that the Borrower is duly qualified and in good standing as a
foreign corporation in such states and has filed all annual
47
42
reports required to be filed to the date of such certificate
and (B) the Secretary of State of Ohio (dated reasonably near
the date of the initial Borrowing), stating that Mr. Coffee is
duly qualified and in good standing as a foreign corporation
in such state and has filed all annual reports required to be
filed to the date of such certificate.
(vi) A certificate of (A) each Loan Party, Mr. Coffee
and Acquisition, signed on behalf of such Loan Party, Mr.
Coffee or Acquisition, as the case may be, by its President or
a Vice President and its Secretary or any Assistant Secretary
(the statements made in such certificate shall be true on and
as of the date of the initial Borrowing), certifying as to (1)
the absence of any amendments to the charter of such Loan
Party, Mr. Coffee or Acquisition since the date of the
appropriate Secretary of State's certificate referred to in
Section 3.01(n)(iv), (2) the completeness and accuracy of the
bylaws of such Loan Party, Mr. Coffee or Acquisition as in
effect on the date of the initial Borrowing (a copy of which
shall be attached to such certificate) and (3) the due
incorporation and good standing of such Loan Party, Mr. Coffee
or Acquisition as a corporation organized under the laws of
its state of incorporation, and the absence of any proceeding
for the dissolution or liquidation of such Loan Party, Mr.
Coffee or Acquisition in such state, and (B) in the case of
each such Loan Party, signed on behalf of such Loan Party by
its President or Vice President, certifying as to (1) the
completeness and accuracy of the representations and
warranties contained in the Loan Documents as though made on
and as of the date of the initial Borrowing and (2) the
absence of any event occurring and continuing, or resulting
from the initial Borrowing, that constitutes a Default.
(vii) A certificate of the Secretary or an Assistant
Secretary of each Loan Party, Mr. Coffee and Acquisition
certifying the names and true signatures of the officers of
such Loan Party, Mr. Coffee or Acquisition, as the case may
be, authorized to sign this Agreement, the Notes, each other
Loan Document and each Related Document to which it is or is
to be a party and the other documents to be delivered
hereunder and thereunder.
(viii) A security agreement in substantially the form
of Exhibit D-1 hereto (as amended, supplemented or otherwise
modified from time to time, the "SECURITY AGREEMENT") and a
patent, trademark and copyright security agreement in
substantially the form of Exhibit D-2 hereto (as amended,
supplemented or otherwise modified from time to time, the
"PATENT, TRADEMARK AND COPYRIGHT SECURITY AGREEMENT"), in each
case duly executed by the Borrower, Acquisition and the
Surviving Corporation, together with:
(A) executed termination statements (Form
UCC-3 or a comparable form), in proper form to be
duly filed on the date of the initial Borrowing under
the Uniform Commercial Code of all jurisdictions that
the Agent may deem desirable in order to terminate or
amend existing Liens on the Collateral described in
the Security Agreement and the Patent, Trademark and
Copyright Security Agreement,
(B) acknowledgment copies, stamped receipt
copies or other evidence satisfactory to the Lenders
of proper financing statements (Form UCC-1 or a
comparable form), duly filed on or before the date of
the initial Borrowing under the Uniform Commercial
Code of all jurisdictions that may be necessary or
that the Agent may deem reasonably desirable in order
to perfect and protect the Liens created by the
Security Agreement and the Patent, Trademark and
Copyright Security Agreement, covering the Collateral
described in the Security Agreement or the Patent,
Trademark and Copyright Security Agreement,
respectively,
48
43
(C) evidence of the completion of all other
recordings and filings of or with respect to the
Security Agreement and the Patent, Trademark and
Copyright Security Agreement that may be necessary or
that the Agent may deem reasonably desirable in order
to perfect and protect the Liens created thereby,
(D) certificates representing the Pledged
Shares referred to therein accompanied by undated
stock powers executed in blank and instruments
evidencing the Pledged Indebtedness referred to
therein indorsed in blank, and
(E) evidence that all other action that the
Agent may deem necessary or desirable in order to
perfect and protect the Liens created by the Security
Agreement and the Patent, Trademark and Copyright
Security Agreement has been taken.
(ix) A pledge agreement in substantially the form of
Exhibit E hereto (as amended, supplemented or otherwise
modified from time to time, the "BRANDS PLEDGE AGREEMENT")
duly executed by Brands, together with certificates
representing the Pledged Shares referred to therein
accompanied by undated stock powers executed in blank.
(x) A guaranty in substantially the form of Exhibit
F-1 (as amended, supplemented or otherwise modified from time
to time in accordance with its terms and this Agreement, the
"BRANDS GUARANTY"), duly executed by Brands, and a guaranty in
substantially the form of Exhibit F-2 (as amended,
supplemented or otherwise modified from time to time in
accordance with its terms and this Agreement, the
"SUBSIDIARIES' GUARANTY"), duly executed by Acquisition and
the Surviving Corporation.
(xi) Certified copies of each of the Related
Documents, duly executed by the parties thereto and in form
and substance satisfactory to the Lenders, together with all
agreements, instruments and other documents delivered in
connection therewith.
(xii) Such financial, business and other information
regarding each Loan Party, Mr. Coffee and Acquisition as the
Lenders shall have requested, including, without limitation,
(A) information as to possible contingent liabilities, tax
matters, environmental matters, obligations under ERISA and
under Plans, Multiemployer Plans, Welfare Plans, collective
bargaining agreements and other arrangements with employees,
(B) annual Consolidated financial statements for the fiscal
years ended on or about December 31, 1993, 1992 and 1991 of
(1) Brands and (2) Mr. Coffee, (C) interim Consolidated
financial statements for the six months ended on or about June
30, 1994 of (1) Brands and (2) Mr. Coffee, (D) Consolidated
pro forma financial statements as to Brands and its
Subsidiaries as at June 30, 1994 and (E) forecasts prepared by
management of Brands and its Subsidiaries, in form and
substance reasonably satisfactory to the Lenders, of
Consolidated balance sheets, income statements and cash flow
statements on a monthly basis through the fiscal year ending
December 31, 1995 and on an annual basis for each fiscal year
thereafter until the Termination Date.
(xiii) Consents and agreements (A) executed by the
lessor of each leasehold and the warehouseman of each
warehouse specified on Schedule 3.01(n)(xiii) hereto and (B)
executed by each supplier to the Borrower or its Subsidiary
specified on Schedule 3.01(n)(xiii) hereto, in each case which
provide that such lessor, warehouseman or supplier agrees that
the Agent has certain rights to the Collateral located thereon
or in the possession thereof, in form and substance
satisfactory to the Lenders.
49
44
(xiv) A certificate, in substantially the form of
Exhibit G-1 hereto, attesting to the Solvency of each Loan
Party, and a certificate, in substantially the form of Exhibit
G-2 hereto, attesting to the Solvency of Mr. Coffee,
individually and, together with their Subsidiaries, taken as a
whole, immediately after giving effect to the Mergers and the
other transactions contemplated hereby and thereby, from its
president, chief financial officer or treasurer; and a
solvency opinion, in substantially the form of Exhibit H
hereto, prepared by Xxxxxx, Xxxxxx & Co.
(xv) Letters, in form and substance reasonably
satisfactory to the Agent, from (A) the Borrower to Xxxxxx
Xxxxxxxx & Co., its independent public accountants, advising
such accountants that the Agent, the Issuing Bank and the
Lenders have been authorized to exercise all rights of the
Loan Parties to require such accountants to disclose any and
all financial statements and any other information of any kind
that they may have with respect to the Loan Parties and their
Subsidiaries and directing such accountants to comply with any
reasonable request of the Agent, any Lender or the Issuing
Bank for such information and (B) from Mr. Coffee to KPMG Peat
Marwick, its independent public accountants, advising such
accountants that the Agent, the Issuing Bank and the Lenders
have been authorized to exercise all rights of the Loan
Parties to require such accountants to disclose any and all
information of any kind that they may have with respect to Mr.
Coffee and its Subsidiaries and directing such accountants to
comply with any reasonable request of the Agent, any Lenders
or the Issuing Bank for such information.
(xvi) Letters, in substantially the form of Exhibits
I hereto, from (A) Xxxxxx Xxxxxxxx & Co., the Borrower's
independent public accountants, to the Agent and (B) KPMG Peat
Marwick, Mr. Coffee's independent public accountants, to the
Agent.
(xvii) Environmental assessment reports, in form and
substance satisfactory to the Lenders, from Xxx X. Xxxxxx,
Inc. as to any hazards, costs or liabilities under
Environmental Laws to which Signature may be subject, the
amount and nature of which, and the Borrower's plans with
respect to which, shall be acceptable to the Lenders, together
with evidence, in form and substance satisfactory to the
Lenders, that all applicable Environmental Laws in connection
with the Mergers shall have been complied with.
(xviii) Evidence of insurance of the Borrower and its
Subsidiaries required by Section 5.01(d), together with an
opinion from the Borrower's insurance underwriter, acceptable
to the Agent, stating that such insurance (including the
amounts, terms and risks covered) is customary for companies
in similar businesses and owning similar properties in the
same general areas in which the Borrower and its Subsidiaries
operate.
(xix) Certified copies of each written compensation
arrangement with the officers of each Loan Party.
(xx) Certified copies of all leases of real property
by Signature and Mr. Coffee.
(xxi) A borrowing base report as of July 31, 1994
with respect to Signature and as of August 12, 1994 with
respect to Mr. Coffee, in substantially the form of Exhibit J
hereto (a "BORROWING BASE REPORT"), certified by the chief
financial officer or treasurer of the Borrower.
(xxii) (A) an executed copy of the First Merger
Certificate in proper form to be delivered to the Secretary of
State of the State of Delaware to consummate the First Merger
and (B) an executed copy of the Second Merger Certificate in
proper form to be delivered to the Secretary of State of the
State of Delaware to consummate the Second Merger.
50
45
(xxiii) Favorable opinions of counsel for the Loan
Parties, in substantially the form of Exhibit K-1, K-2 and K-3
hereto, and addressing such other matters as any Lender or the
Issuing Bank through the Agent may reasonably request.
(xxiv) A favorable opinion of Xxxxxx & Xxxxxxx,
special patent, trademark and copyright counsel for the
Lenders, in form and substance satisfactory to the Agent.
(xxv) A favorable opinion of Shearman & Sterling,
counsel for the Agent, in form and substance satisfactory to
the Agent.
SECTION 3.02. CONDITIONS PRECEDENT TO EACH BORROWING. The
obligation of each Appropriate Lender to make an Advance (other than a Letter of
Credit Advance made by a Lender pursuant to Section 2.13(c) and other than a
Swing Line Advance made by a Lender pursuant to Section 2.02(f)) on the occasion
of each Borrowing (including the initial Borrowing), and the obligation of the
Issuing Bank to issue a Letter of Credit or to renew a Standby Letter of Credit
shall be subject to the further conditions precedent that on the date of such
Borrowing (a) the following statements shall be true (and each of the giving of
the applicable Notice of Borrowing, Notice of Swing Line Borrowing, Notice of
Issuance or Notice of Renewal and the acceptance by the Borrower of the proceeds
of such Borrowing, the issuance of such Letter of Credit or of the renewal of
such Standby Letter of Credit, as the case may be, shall constitute a
representation and warranty by the Borrower that on the date of such Borrowing
such statements are true):
(i) the representations and warranties contained in each Loan
Document are correct on and as of the date of such Borrowing, before
and after giving effect to such Borrowing and to the application of the
proceeds therefrom, as though made on and as of such date;
(ii) no event has occurred and is continuing, or would result
from such Borrowing or from the application of the proceeds therefrom,
that constitutes a Default; and
(iii) for each Revolving Credit Advance, Swing Line Advance or
the issuance or renewal of any Letter of Credit, the sum of the Loan
Values of the Eligible Collateral exceeds the sum of (A) the aggregate
principal amount of the Revolving Credit Advances, Swing Line Advances
and Letter of Credit Advances then outstanding after giving effect to
such Borrowing and (B) the aggregate Available Amount of all Letters of
Credit then outstanding after giving effect to such Borrowing;
and (b) the Agent shall have received such other approvals, opinions or
documents as any Appropriate Lender or the Issuing Bank through the Agent may
reasonably request.
SECTION 3.03. DETERMINATIONS UNDER SECTION 3.01. For purposes
of determining compliance with the conditions specified in Section 3.01, each
Lender shall be deemed to have consented to, approved or accepted or to be
satisfied with each document or other matter required thereunder to be consented
to or approved by or acceptable or satisfactory to the Lenders unless an officer
of the Agent responsible for the transactions contemplated by the Loan Documents
shall have received notice from such Lender prior to the initial Borrowing
specifying its objection thereto and such Lender shall not have made available
to the Agent such Lender's ratable portion of such Borrowing.
51
46
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. REPRESENTATIONS AND WARRANTIES OF THE BORROWER.
The Borrower represents and warrants as follows:
(a) Each Loan Party (i) is a corporation duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation, (ii) is duly qualified and in good
standing as a foreign corporation in each other jurisdiction in which
it owns or leases property or in which the conduct of its business
requires it to so qualify or be licensed, except where the failure to
so qualify or be licensed could not have a Material Adverse Effect, and
(iii) has all requisite corporate power and authority to own or lease
and operate its properties and to carry on its business as now
conducted and as proposed to be conducted. All of the outstanding
capital stock (A) of Signature is owned by Brands free and clear of all
Liens, except those Liens created by the Brands Pledge Agreement and
(B) of Acquisition is owned by Signature free and clear of all liens,
except those Liens created by the Collateral Documents.
(b) Set forth on Schedule 4.01(b) hereto is a complete and
accurate list of all Subsidiaries of each Loan Party, showing (as to
each such Subsidiary) the jurisdiction of its incorporation, the number
of shares of each class of capital stock authorized, the number
outstanding, and the percentage of the outstanding shares of each such
class owned (directly or indirectly) by such Loan Party and the number
of shares covered by all outstanding options, warrants, rights of
conversion or purchase and similar rights. All of the outstanding
capital stock of each such Subsidiary has been validly issued, is fully
paid and nonassessable and is owned by the Loan Party and/or one or
more of its Subsidiaries specified on Schedule 4.01(b) free and clear
of all Liens, except those Liens created by the Collateral Documents.
Each such Subsidiary (i) is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation, (ii) is duly qualified and in good standing as a foreign
corporation in each other jurisdiction in which it owns or leases
property or in which the conduct of its business requires it to so
qualify or be licensed, except where the failure to so qualify or be
licensed could not have a Material Adverse Effect, and (iii) has all
requisite corporate power and authority to own or lease and operate its
properties and to carry on its business as now conducted and as
proposed to be conducted. The aggregate value of the assets of Kava do
not exceed $50,000.
(c) The execution, delivery and performance by each Loan Party
of this Agreement, the Notes, each other Loan Document and each Related
Document to which it is or is to be a party, and the consummation of
the Mergers and the other transactions contemplated hereby and thereby,
are within such Loan Party's corporate powers, have been duly
authorized by all necessary corporate action, and do not (i) contravene
such Loan Party's charter or bylaws, (ii) violate any law (including,
without limitation, the Exchange Act and the Racketeer Influenced and
Corrupt Organizations Chapter of the Organized Crime Control Act of
1970), rule, regulation (including, without limitation, Regulation X of
the Board of Governors of the Federal Reserve System), order, writ,
judgment, injunction, decree, determination or award, (iii) conflict
with or result in the breach of, or constitute a default under, any
contract, loan agreement, indenture, mortgage, deed of trust, lease or
other instrument binding on or affecting such Loan Party, any of its
Subsidiaries or any of their properties or (iv) except for the Liens
created by the Collateral Documents, result in or require the creation
or imposition of any Lien upon or with respect to any of the properties
of such Loan Party or any of its Subsidiaries. The Loan Parties and
each of their Subsidiaries is not in violation of any law, rule,
regulation, order, writ, judgment, injunction, decree, determination or
award or in breach of any such contract, loan agreement, indenture,
mortgage, deed of trust, lease or other instrument referred to in the
immediately preceding sentence, the violation or breach of which could
have a Material Adverse Effect.
52
47
(d) No authorization, approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for (i) the due execution,
delivery, recordation, filing or performance by any Loan Party of this
Agreement, the Notes, any other Loan Document or any Related Document
to which it is or is to be a party, or for the consummation of the
Mergers or the other transactions contemplated hereby or thereby, (ii)
the grant by any Loan Party of the Liens granted by it pursuant to the
Collateral Documents, (iii) the perfection or maintenance of the Liens
created by the Collateral Documents (including the first priority
nature thereof), except for the filing of (A) financing and
continuation statements under the Uniform Commercial Code, which
financing statements have been duly filed, (B) the First Merger
Certificate, which has been duly filed and is in full force and effect,
and the Second Merger Certificate, which is in proper form to be filed
with Secretary of State of the State of Delaware to consummate the
Second Merger, and (C) the Patent, Trademark and Copyright Security
Agreement in the U.S. Patent and Trademark Office, which agreement
shall be duly filed on or about the date of the initial Borrowing, or
(iv) the exercise by the Agent, the Swing Line Bank, the Issuing Bank,
any Existing Issuing Bank or any Lender of its rights under the Loan
Documents or the remedies in respect of the Collateral pursuant to the
Collateral Documents. All applicable waiting periods in connection with
the Mergers and the other transactions contemplated hereby and thereby
have expired without any action having been taken by any competent
authority restraining, preventing or imposing materially adverse
conditions upon the Mergers or the rights of the Loan Parties or their
Subsidiaries freely to transfer or otherwise dispose of, or to create
any Lien on, any properties now owned or hereafter acquired by any of
them.
(e) This Agreement has been, and each of the Notes, each other
Loan Document and each Related Document when delivered hereunder will
have been, duly executed and delivered by each Loan Party party
thereto. This Agreement is, and each of the Notes, each other Loan
Document and each Related Document when delivered hereunder will be,
the legal, valid and binding obligation of each Loan Party party
thereto, enforceable against such Loan Party in accordance with its
terms.
(f) (i) The Consolidated balance sheet of Brands as at
December 31, 1993, and the related Consolidated statement of income,
retained earnings and cash flow of Brands for the fiscal year then
ended, accompanied by an opinion of Xxxxxx Xxxxxxxx & Co., independent
public accountants, and the unaudited Consolidated balance sheet of
Brands as at June 30, 1994, and the related Consolidated statement of
income, retained earnings and cash flow of Brands for the six fiscal
months then ended, duly certified by the chief financial officer of the
Borrower, copies of which have been furnished to each Lender, the Swing
Line Bank and the Issuing Bank, fairly present the financial condition
of Brands as at such date and the results of operations of Brands for
the period ended on such date, all in accordance with generally
accepted accounting principles applied on a consistent basis except,
with respect to such unaudited financial statements, for normal
year-end adjustments and changes to the notes to the financial
statements, and since December 31, 1993, there has been no Material
Adverse Change.
(ii) The Consolidated balance sheet of Mr. Coffee as
at December 26, 1993, and the related Consolidated statement of income,
retained earnings and cash flow of Mr. Coffee for the fiscal year then
ended, accompanied by an opinion of KPMG Peat Marwick, independent
public accountants, and the unaudited Consolidated balance sheet of Mr.
Coffee as at June 26, 1994, and the related Consolidated statement of
income, retained earnings and cash flow of Mr. Coffee for the six
fiscal months then ended, duly certified by the chief financial officer
of Mr. Coffee, copies of which have been furnished to each Lender, the
Swing Line Bank and the Issuing Bank, fairly present the financial
condition of Mr. Coffee as at such date and the results of operations
of Mr. Coffee for the period ended on such date, all in accordance with
generally accepted accounting principles applied on a consistent basis
except, with respect to such unaudited financial statements, for normal
year-end adjustments and changes to the notes to the financial
statements, and since December 26, 1993, there has been no material
adverse change in the
53
48
business, condition (financial or otherwise), operation, performance,
properties or prospects of Mr. Coffee, either individually or, together
with its Subsidiaries, taken as a whole.
(g) The Consolidated pro forma balance sheets of Brands and
its Subsidiaries as at June 30, 1994, and the related Consolidated pro
forma statement of income, retained earnings and cash flow of Brands
and its Subsidiaries for the six months then ended, certified by the
chief financial officer of the Borrower, copies of which have been
furnished to each Lender, the Swing Line Bank and the Issuing Bank,
fairly present the Consolidated pro forma financial condition of Brands
and its Subsidiaries as at such date and the Consolidated pro forma
results of operations of Brands and its Subsidiaries for the period
ended on such date, in each case after giving effect to the Mergers and
the other transactions contemplated hereby and thereby, all in
accordance with GAAP.
(h) The Consolidated forecasted balance sheets, income
statements and cash flow statements of Brands and its Subsidiaries
delivered to the Lenders pursuant to Sections 3.01(n)(xii) and 5.03(e)
were prepared in good faith on the basis of the assumptions stated
therein, which assumptions were reasonable in the light of conditions
existing at the time of delivery of such forecasts, and represented, at
the time of delivery, the Borrower's best estimate of its future
financial performance.
(i) None of the written information, exhibits or reports
(including, without limitation, any financial information (other than
such financial information referred to in Section 4.01(h) which shall
be prepared and delivered in accordance with such Section 4.01(h))
furnished by or on behalf of any Loan Party or Mr. Coffee to the Agent,
the Swing Line Bank, the Issuing Bank or any Lender in connection with
the negotiation of the Loan Documents or pursuant to the terms of the
Loan Documents contained any untrue statement of a material fact or
omitted to state a material fact necessary to make the statements made
therein not misleading, except to the extent such information, exhibit
or report has been amended, supplemented or modified by any other
information, exhibit or report subsequently delivered to the Agent, the
Issuing Bank or such Lender that previously received such information,
exhibit or report.
(j) There is no action, suit, investigation, litigation or
proceeding affecting any Loan Party, any of their Subsidiaries or any
of their properties (including any Environmental Action) pending or
threatened before any court, governmental agency or arbitrator that (i)
is reasonably likely to have a Material Adverse Effect or (ii) except
as described on Schedule 4.01(j) hereto (the "DISCLOSED LITIGATION"),
purports to affect the legality, validity or enforceability of the
Mergers, this Agreement, any Note, any other Loan Document or any
Related Document or the consummation of the transactions contemplated
hereby or thereby.
(k) Except in accordance with the terms of the Merger
Agreement, no proceeds of any Advance will be used to acquire any
equity security of a class that is registered pursuant to Section 12 of
the Exchange Act.
(l) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying Margin Stock, and no
proceeds of any Advance will be used to purchase or carry any Margin
Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock.
(m) Set forth on Schedule 4.01(m) hereto is a complete and
accurate list as of the date hereof of all Plans, Multiemployer Plans
and Welfare Plans maintained or contributed to by each Loan Party or
any of its Subsidiaries or as to which such Loan Party or any such
Subsidiary has a commitment to establish.
54
49
(n) No ERISA Event has occurred or is reasonably expected to
occur with respect to any Plan of any Loan Party or any of its ERISA
Affiliates that has resulted or is reasonably likely to result in
liabilities of such Loan Party and its ERISA Affiliates that exceed
$250,000.
(o) Schedule B (Actuarial Information) to the most recently
completed annual report (form 5500 Series) for each Plan of any Loan
Party or any of its ERISA Affiliates, if any, copies of which have been
filed with the Internal Revenue Service and furnished to the Lenders,
the Swing Line Bank and the Issuing Bank, is complete and accurate and
fairly presents the funding status of such Plan and, since the date of
such Schedule B, there has been no material adverse change in such
funding status.
(p) Neither any Loan Party nor any of its ERISA Affiliates has
incurred or is reasonably expected to incur any Withdrawal Liability to
any Multiemployer Plan.
(q) Neither any Loan Party nor any of its ERISA Affiliates has
been notified by the sponsor of a Multiemployer Plan of any Loan Party
or any of its ERISA Affiliates that such Multiemployer Plan is in
reorganization or has been terminated, within the meaning of Title IV
of ERISA, and no such Multiemployer Plan is reasonably expected by such
Loan Party or any of its ERISA Affiliates to be in reorganization or to
be terminated, within the meaning of Title IV of ERISA.
(r) The aggregate annualized cost (including, without
limitation, the cost of insurance premiums), if any, with respect to
post-retirement benefits under Welfare Plans for which the Loan Parties
and their Subsidiaries are liable does not exceed $100,000 and the
projected aggregate liability for all such post-retirement benefits
does not exceed $250,000.
(s) Neither the business nor the properties of any Loan Party
or any of its Subsidiaries are affected by any fire, explosion,
accident, strike, lockout or other labor dispute, drought, storm, hail,
earthquake, embargo, act of God or of the public enemy or other
casualty (whether or not covered by insurance) that could have a
Material Adverse Effect.
(t) Except as described on Schedule 4.01(t) hereto, the
operations and properties of each Loan Party and each of its
Subsidiaries comply in all material respects with all Environmental
Laws; all material Environmental Permits have been obtained and are in
effect for the operations and properties of each Loan Party and its
Subsidiaries; each Loan Party and its Subsidiaries are in compliance in
all material respects with all such Environmental Permits; and no
circumstances exist that could (i) form the basis of an Environmental
Action against any Loan Party or any of its Subsidiaries or any of
their properties that could have a Material Adverse Effect or (ii)
cause any such property to be subject to any material restrictions on
ownership, occupancy, use or transferability under any Environmental
Law.
(u) None of the properties of any Loan Party or any of its
Subsidiaries is listed or, to the best of its knowledge, proposed for
listing on the National Priorities List under CERCLA or on the
Comprehensive Environmental Response, Compensation and Liability
Information System maintained by the Environmental Protection Agency or
any analogous state list of sites requiring investigation or cleanup,
or is adjacent to any such property; and no underground storage tanks,
as such term is defined in 42 U.S.C. Section 6991, are located on any
property of any Loan Party or any of its Subsidiaries.
(v) Neither any Loan Party nor any of its Subsidiaries has
transported or arranged for the transportation of any Hazardous
Materials to any location that is listed or, to the best of its
knowledge, proposed for listing on the National Priorities List under
CERCLA or on the Comprehensive Environmental Response, Compensation and
Liability Information System maintained by the Environmental Protection
Agency or any analogous state list; Hazardous Materials have not been
generated, used, treated, handled,
55
50
stored or disposed of on, or released or transported to or from, any
property of any Loan Party or any of its Subsidiaries, except in
compliance with all Environmental Laws and Environmental Permits; and
all other wastes generated at any such properties have been disposed of
in compliance with all Environmental Laws and Environmental Permits.
(w) None of Loan Parties nor any of their Subsidiaries is a
party to any indenture, loan or credit agreement or lease or other
agreement or instrument or is subject to any charter or corporate
restriction that could have a Material Adverse Effect.
(x) Each of Loan Parties and each of their Subsidiaries has
filed, has caused to be filed or has been included in all tax returns
(federal, state, local and foreign) required to be filed and, except as
otherwise permitted in Section 5.01(b), have paid all taxes shown
thereon to be due, together with applicable interest and penalties.
(y) Set forth on Schedule 4.01(y) hereto is a complete and
accurate list, as of the date hereof, of each taxable year of Brands,
Mr. Coffee and their Subsidiaries for which federal income tax returns
have been filed and for which the expiration of the applicable statute
of limitations for assessment or collection has not occurred by reason
of extension or otherwise (an "OPEN YEAR").
(z) The aggregate unpaid amount, as of the date hereof, of
adjustments to the federal income tax liability of Brands, Mr. Coffee
and their Subsidiaries proposed by the Internal Revenue Service with
respect to Open Years does not exceed $10,000. No issues have been
raised by the Internal Revenue Service in respect of Open Years that,
in the aggregate, could have a Material Adverse Effect.
(aa) The aggregate unpaid amount, as of the date hereof, of
adjustments to the state, local and foreign tax liability of Brands,
Mr. Coffee and their Subsidiaries proposed by all state, local and
foreign taxing authorities (other than amounts arising from adjustments
to federal income tax returns) does not exceed $25,000. No issues have
been raised by such state, local and foreign taxing authorities that,
in the aggregate, could have a Material Adverse Effect.
(bb) Neither any Loan Party nor any of its Subsidiaries is an
"investment company," or, other than as set forth on Schedule 4.01(bb)
hereto, an "affiliated person" of, or "promoter" or "principal
underwriter" for, an "investment company," as such terms are defined in
the Investment Company Act. Each transaction between such Loan Party or
such Subsidiary and any Person identified on such Schedule 4.01(bb) has
been conducted in all material respects in compliance with all
applicable laws, rules, regulations and orders. Neither the making of
any Advances, the issuance of any Letters of Credit nor the application
of the proceeds therefrom or repayment thereof by the Borrower, nor the
consummation of the other transactions contemplated hereby, will
violate any provision of such Act or any rule, regulation or order of
the Securities and Exchange Commission thereunder.
(cc) Each Loan Party is, individually and together with its
Subsidiaries, Solvent.
(dd) Set forth on Schedule 4.01(dd) hereto is a complete and
accurate list as of the date hereof of all Surviving Indebtedness,
showing as of such date each Loan Party and its Subsidiaries party
thereto, the principal amount outstanding thereunder and the scheduled
maturity thereof.
(ee) Set forth on Schedule 4.01(ee) hereto is a complete and
accurate list of all real property owned by each Loan Party and each of
its Subsidiaries, showing as of the date hereof the street address,
county or other relevant jurisdiction, state, record owner and book
value thereof. Each such Loan Party
56
51
or such Subsidiary has good, marketable and insurable fee simple title
to such real property, free and clear of all Liens, other than Liens
created or permitted by the Loan Documents.
(ff) Set forth on Schedule 4.01(ff) hereto is a complete and
accurate list of all leases of real property under which any of the
Loan Parties or any of their Subsidiaries is the lessee, showing as of
the date hereof the street address, county or other relevant
jurisdiction, state, lessor, lessee, expiration date and annual rental
cost thereof. Each such lease is, to the best of the Borrower's
knowledge, the legal, valid and binding obligation of the lessor
thereof, enforceable in accordance with its terms.
(gg) Set forth on Schedule 4.01(gg) hereto is a complete and
accurate list of all Investments held by any Loan Party or any of their
Subsidiaries, showing as of the date hereof the amount, obligor or
issuer and maturity, if any, thereof.
(hh) Set forth on Schedule 4.01(hh) hereto is a complete and
accurate list of all patents, trademarks, trade names, service marks
and copyrights, and all applications therefor and licenses thereof, of
each Loan Party and each of their Subsidiaries, showing as of the date
hereof the jurisdiction in which registered, the registration number,
the date of registration and the expiration date.
ARTICLE V
COVENANTS OF THE BORROWER
SECTION 5.01. AFFIRMATIVE COVENANTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any Lender,
the Swing Line Bank, the Issuing Bank shall have any Commitment hereunder, the
Borrower will:
(a) COMPLIANCE WITH LAWS, ETC. Comply, and cause each of its
Subsidiaries to comply, in all material respects, with all applicable
laws, rules, regulations and orders, such compliance to include,
without limitation, compliance with ERISA and the Racketeer Influenced
and Corrupt Organizations Chapter of the Organized Crime Control Act of
1970.
(b) PAYMENT OF TAXES, ETC. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, before the same shall become
delinquent (i) all taxes, assessments and governmental charges or
levies imposed upon it or upon its property other than such taxes,
assessments and governmental charges or levies which do not exceed
$25,000 at any time outstanding and (ii) all lawful claims that, if
unpaid, might by law become a Lien upon its property, which together
with all such other Liens, exceeds $25,000; PROVIDED, HOWEVER, that
neither the Borrower nor any of its Subsidiaries shall be required to
pay or discharge any such tax, assessment, charge, levy or claim that
is being contested in good faith and by proper proceedings and as to
which appropriate reserves are being maintained, unless and until any
Lien resulting therefrom attaches to its property and becomes
enforceable against its other creditors.
(c) COMPLIANCE WITH ENVIRONMENTAL LAWS. Comply, and cause each
of its Subsidiaries and all lessees and other Persons occupying its
properties to comply, in all material respects, with all Environmental
Laws and Environmental Permits applicable to its operations and
properties; obtain and renew all Environmental Permits necessary for
its operations and properties; and conduct, and cause each of its
Subsidiaries to conduct, any investigation, study, sampling and
testing, and undertake any cleanup, removal, remedial or other action
necessary to remove and clean up all Hazardous Materials from any of
its properties, in accordance with the requirements of all
Environmental Laws; PROVIDED, HOWEVER, that neither the Borrower nor
any of its Subsidiaries shall be required to undertake any such
cleanup, removal,
57
52
remedial or other action to the extent that its obligation to do so is
being contested in good faith and by proper proceedings and appropriate
reserves are being maintained with respect to such circumstances.
(d) MAINTENANCE OF INSURANCE. Maintain, and cause each of its
Subsidiaries to maintain, insurance (including, without limitation,
insurance required by the Security Agreement and the Mortgages) with
responsible and reputable insurance companies or associations in such
amounts, on such terms and covering such risks as is usually carried by
companies in similar businesses and owning similar properties in the
same general areas in which the Borrower or such Subsidiary operates,
in each case naming the Agent as insured and as loss payee.
(e) PRESERVATION OF CORPORATE EXISTENCE, ETC. Preserve and
maintain, and cause each of its Subsidiaries to preserve and maintain,
its corporate existence, rights (charter and statutory) and franchises;
PROVIDED, HOWEVER, that the Subsidiaries of the Borrower may consummate
any merger or consolidation permitted under Section 5.02(d).
(f) VISITATION RIGHTS. At any time and from time to time upon
reasonable notice, permit the Agent, the Swing Line Bank, the Issuing
Bank or, if arranged through the Agent, any of the Lenders, or any
agents or representatives thereof, to examine and make copies of and
abstracts from the records and books of account of, and visit the
properties of, the Borrower and any of its Subsidiaries, and to discuss
the affairs, finances and accounts of the Borrower and any of its
Subsidiaries with any of their officers or directors and with their
independent public accountants; PROVIDED that the Borrower, or a
representative of the Borrower, shall have this opportunity to be
present at any such discussion with such independent public
accountants.
(g) PREPARATION OF ENVIRONMENTAL REPORTS. At the request of
the Agent from time to time but in no event no more than two times
after the date hereof or at any time upon (i) the occurrence and during
the continuation of an Event of Default, (ii) the acquisition of any
real property interest (excluding any leasehold interest) and (iii) the
change of any Environmental Law, provide to the Lenders, the Swing Line
Bank and the Issuing Bank within 60 days after such request, at the
expense of the Borrower, an environmental site assessment report for
all of its and its Subsidiaries' properties described in such request,
prepared by an environmental consulting firm acceptable to the Agent,
indicating the presence or absence of Hazardous Materials and the
estimated cost of any compliance, removal or remedial action in
connection with any Hazardous Materials on such properties. Without
limiting the generality of the foregoing, if the Agent determines at
any time that a material risk exists that any such environmental
assessment report will not be delivered within the time referred to
above, the Agent may retain an environmental consulting firm to prepare
such report at the expense of the Borrower, and the Borrower hereby
grants, and agrees to cause any Subsidiary that owns any property
described in such request to grant, at the time of such request, to the
Agent, the Lenders, the Swing Line Bank, the Issuing Bank, such firm
and any agents or representatives thereof an irrevocable nonexclusive
license, subject to the rights of tenants, to enter onto their
respective properties to undertake such an assessment.
(h) KEEPING OF BOOKS. Keep, and cause each of its Subsidiaries
to keep, proper books of record and account, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Borrower and each such Subsidiary in accordance with
generally accepted accounting principles in effect from time to time.
(i) MAINTENANCE OF PROPERTIES, ETC. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its
properties that are used or useful in the conduct of its business in
good working order and condition, ordinary wear and tear excepted.
58
53
(j) COMPLIANCE WITH TERMS OF LEASEHOLDS. (i) Make all payments
and otherwise perform all obligations in respect of all leases of real
property, keep such leases in full force and effect and not allow such
leases to lapse or be terminated or any rights to renew such leases to
be forfeited or cancelled, in each case except to the extent that the
failure to so act could not adversely affect the interest or rights of
the Borrower or of the Agent or the Lenders in any manner and (ii)
notify the Agent of any default by any party with respect to such
leases and cooperate with the Agent in all respects to cure any such
default, and cause each of its Subsidiaries to do so.
(k) PERFORMANCE OF RELATED DOCUMENTS. (i) Perform and observe
all of the terms and provisions of each Related Document to be
performed or observed by it, maintain each such Related Document in
full force and effect and enforce each such Related Document in
accordance with its terms, in each case except to the extent that the
failure to so act could not adversely affect the interest or rights of
the Borrower or of the Agent, the Swing Line Bank, the Issuing Bank,
the Existing Issuing Banks or the Lenders in any manner (it being
acknowledged by the Borrower that a change in the financial and payment
terms of any such Related Document could adversely affect such interest
or rights), and take all such action to such end as may be from time to
time reasonably requested by the Agent and (ii) upon the reasonable
request of the Agent, make to each other party to each such Related
Document such demands and requests for information and reports or for
action as the Borrower is entitled to make under such Related Document.
(l) TRANSACTIONS WITH AFFILIATES. Conduct, and cause each of
its Subsidiaries to conduct, all transactions otherwise permitted under
the Loan Documents with any of their Affiliates on terms that are fair
and reasonable and no less favorable to the Borrower or such Subsidiary
than it would obtain in a comparable arm's-length transaction with a
Person not an Affiliate; PROVIDED, HOWEVER, that the Borrower may (i)
make any payments required under the Tax Sharing Agreement in
accordance with the terms thereof and (ii) pay to Xxxxxx X. Xxx Company
(A) a financial advisory fee in connection with the Acquisition not to
exceed $750,000 and (B) a management fee not to exceed $240,000 per
annum, in each case with respect to this clause (ii) PLUS reasonable
and documented expenses in connection therewith.
(m) COVENANT TO GIVE SECURITY. Upon the request of the Agent
following the occurrence and during the continuance of a Default under
6.01(e) or an Event of Default, and at the expense of the Borrower, (i)
within ten days after such request, furnish to the Agent a description
of the real and personal properties of the Borrower and its
Subsidiaries in detail reasonably satisfactory to the Agent, (ii)
within 15 days after such request, duly execute and deliver to the
Agent mortgages, pledges, assignments and other security agreements, as
specified by and in form and substance satisfactory to the Agent,
securing payment of all the Obligations of the Borrower under the Loan
Documents and constituting Liens on all such properties, (iii) within
30 days after such request, take whatever action (including, without
limitation, the recording of mortgages, the filing of Uniform
Commercial Code financing statements, the giving of notices and the
endorsement of notices on title documents) as may be necessary or
advisable in the opinion of the Agent to vest in the Agent (or in any
representative of the Agent designated by it) valid and subsisting
Liens on the properties purported to be subject to the security
agreements delivered pursuant to this Section 5.01(m), enforceable
against all third parties in accordance with their terms, (iv) within
45 days after such request, deliver to the Agent a signed copy of a
favorable opinion of counsel for the Borrower, addressed to the Agent,
the Swing Line Bank, the Issuing Bank, the Lenders and the Hedge Banks
and acceptable to the Agent, as to the matters contained in clauses
(i), (ii) and (iii) above, as to such security agreements being legal,
valid and binding obligations of the Borrower and its Subsidiaries
59
54
enforceable in accordance with their terms and as to such other matters
as the Agent may reasonably request, (v) as promptly as practicable
after such request, deliver to the Agent surveys and mortgage title
insurance policies as to each parcel of real property subject to such
request, in each case in form and substance satisfactory to the Agent,
and (vi) at any time and from time to time, promptly execute and
deliver any and all further instruments and documents and take all such
other action as the Agent may deem desirable in obtaining the full
benefits of, or in preserving the Liens of, such security agreements
(n) INTEREST RATE HEDGING. Within 60 days after the date of
the initial Borrowing, enter into, and maintain for a period of two
years thereafter, interest rate Hedge Agreements with Persons
acceptable to the Agent, covering a notional amount of not less than
$50,000,000 and providing for an interest rate cap on LIBOR of 2.25%
above the prevailing LIBOR rate then in effect.
(o) CONSENTS, ETC. Unless the Agent provides otherwise, use,
and cause each of its Subsidiaries to use, its best efforts to cause
each lessor identified on Schedule 5.01(o) hereto upon the expiration
of the lease identified for such lessor and each other lessor and each
warehouseman or supplier to enter into a consent and agreement, which
shall provide that such lessor, warehouseman or supplier agrees that
the Agent has certain rights to the Collateral located on such lessor's
or warehouseman's property or in the possession of such supplier, in
each case in form and substance reasonably satisfactory to the Agent.
(p) CONDITIONS SUBSEQUENT. (i) UCC SEARCH REPORTS. As promptly
as practicable after the date of the initial Borrowing, furnish to the
Agent completed requests for information listing the financing
statements referred to in Section 3.01(n)(viii)(B) and all other
effective financing statements filed in the jurisdictions referred to
in Section 3.01(n)(viii)(B) that name any Loan Party as debtor,
together with copies of such other financing statements.
(ii) THE MERGER. (A) Immediately after the initial Borrowing
hereunder, file the First Merger Certificate in proper form with the
Secretary of State of the State of Delaware and cause the consummation
of the First Merger in accordance with all applicable laws and (B)
promptly as practicable, and in no event later than the next Business
Day after the date of the initial Borrowing, file the Second Merger
Certificate in proper form with the Secretary of State of the State of
Delaware and cause the consummation of the Second Merger in accordance
with all application laws;
(iii) MORTGAGES. As promptly as practicable after the date
hereof, and in no event later than 60 days after the date hereof,
furnish to the Agent deeds of trust, trust deeds and mortgages, in form
and substance satisfactory to the Agent, covering the properties listed
on Schedule 5.01(p)(iii) (as amended, supplemented or otherwise
modified from time to time in accordance with their terms and this
Agreement, the "MORTGAGES"), duly executed by the Borrower, together
with:
(A) evidence satisfactory to the Agent that
counterparts of the Mortgages have been duly recorded on or
prior to the date which is 60 days after the date hereof in
all filing or recording offices that may be necessary or that
the Agent may deem desirable in order to create a valid first
and subsisting Lien on the property described therein in favor
of the Agent, the Lenders, the Swing Line Bank, the Issuing
Bank, the Existing Issuing Banks and the Hedge Banks and that
all filing and recording taxes and fees have been paid,
(B) a fully paid American Land Title Association
Lender's Extended Coverage title insurance policy (the
"MORTGAGE POLICIES") in form and substance, with endorsements
and in an amount acceptable to the Agent, issued, coinsured
and reinsured by title insurers acceptable to the Agent,
insuring the Mortgages to be a valid first and subsisting Lien
on the property described
60
55
therein, free and clear of all defects (including, but not
limited to, mechanics' and materialmen's Liens) and
encumbrances, other than Permitted Encumbrances, and providing
for such other affirmative insurance (including endorsements
for future advances under the Loan Documents and for
mechanics' and materialmen's Liens) and such coinsurance and
direct access reinsurance as may be necessary or as the Agent
may deem desirable,
(C) an American Land Title Association form survey,
dated no more than 30 days prior to the date that the
Mortgages are furnished to the Agent hereunder, certified to
the Agent and the issuer of the Mortgage Policies in a manner
satisfactory to the Agent by a land surveyor duly registered
and licensed in the State in which the properties described in
such surveys is located and acceptable to the Agent, showing
all buildings and other improvements, any offsite
improvements, the location of any easements, parking spaces,
rights of way, building setback lines and other dimensional
regulations and the absence of encroachments (either by such
improvements on or to such property) and other defects, other
than encroachments and other defects acceptable to the Agent,
and
(D) evidence that all other actions that may be
necessary or that the Agent may deem reasonably desirable in
order to create a valid first and subsisting Lien on the
property described in the Mortgages has been taken and such
other approvals, opinions or documents as the Agent may
reasonably request.
SECTION 5.02. NEGATIVE COVENANTS. So long as any Advance shall
remain unpaid, any Letter of Credit shall be outstanding or any Lender,
or the Swing Line Bank, or the Issuing Bank shall have any Commitment
hereunder, the Borrower will not:
(a) LIENS, ETC. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Lien on or with respect to any of its properties of any
character (including, without limitation, accounts), whether now owned
or hereafter acquired, or sign or file, or permit any of its
Subsidiaries to sign or file, under the Uniform Commercial Code of any
jurisdiction, a financing statement that names the Borrower or any of
its Subsidiaries as debtor, or sign, or permit any of its Subsidiaries
to sign, any security agreement authorizing any secured party
thereunder to file such financing statement, or assign, or permit any
of its Subsidiaries to assign, any accounts or other rights to receive
income, EXCLUDING, HOWEVER, from the operation of the foregoing
restrictions the following:
(i) Liens created by the Loan Documents;
(ii) Permitted Liens;
(iii) purchase money Liens upon or in one or more
items of personal or real property acquired or held by the
Borrower or any of its Subsidiaries in the ordinary course of
business to secure the purchase price of such property or to
secure Indebtedness incurred solely for the purpose of
financing the acquisition of any such property to be subject
to such Liens, or Liens existing on any such property at the
time of acquisition, or extensions, renewals or replacements
of any of the foregoing for the same or a lesser amount;
PROVIDED, HOWEVER, that no such Lien shall extend to or cover
any property other than the property being acquired, and no
such extension, renewal or replacement shall extend to or
cover any property not theretofore subject to the Lien being
extended, renewed or replaced; and PROVIDED FURTHER that any
such Indebtedness shall not otherwise be prohibited by the
terms of the Loan Documents; and
61
56
(iv) Liens arising in connection with Capitalized
Leases.
(b) INDEBTEDNESS. Create, incur, assume or suffer to exist, or
permit any of its Subsidiaries to create, incur, assume or suffer to
exist, any Indebtedness other than:
(i) in the case of the Borrower,
(A) Indebtedness under the Loan Documents,
(B) Surviving Indebtedness,
(C) Indebtedness evidenced by the
Subordinated Notes, and
(D) Indebtedness in respect of Hedge
Agreements required to be maintained under Section
5.01(n) with one or more Hedge Banks, and
(E) guaranties of the Obligations of
Concepts in an aggregate amount not to exceed
$350,000 at any time outstanding;
(ii) in the case of any of its Subsidiaries,
(A) Indebtedness owed to the Borrower in an
aggregate principal amount, together, without
duplication, with all Investments outstanding in
accordance with Section 5.02(f)(ii), not to exceed
$1,000,000 at any time outstanding and evidenced by a
promissory note in form and substance acceptable to
the Agent and pledged to the Lenders, the Swing Line
Bank, the Issuing Bank and the Existing Issuing Banks
under the Security Agreement,
(B) guarantees required under the Indenture;
(iii) in the case of the Borrower and any of its
Subsidiaries,
(A) Indebtedness secured by Liens permitted
by Section 5.02(a)(iii) or (iv) not to exceed an
aggregate amount for all such Liens of $2,500,000 at
any time outstanding,
(B) Indebtedness consisting of trade
payables incurred in the ordinary course of business,
and
(C) indorsement of negotiable instruments
for deposit or collection or similar transactions in
the ordinary course of business; and
(iv) in the case of Mr. Coffee, the Obligations of
Mr. Coffee to purchase or otherwise make any payment with
respect to its common stock required by the Merger Agreement.
(c) LEASE OBLIGATIONS. Create, incur, assume or suffer to
exist, or permit any of its Subsidiaries to create, incur, assume or
suffer to exist, any obligations as lessee for the rental or hire of
real or personal property of any kind under leases or agreements to
lease (excluding Capitalized Leases) having an original term of one
year or more that would cause the direct and contingent liabilities of
the
62
57
Borrower and its Subsidiaries, on a Consolidated basis, in respect of
all such Obligations to exceed $5,000,000 payable in any consecutive
12-month period.
(d) MERGERS, ETC. Merge into or consolidate with any Person or
permit any Person to merge into it, or transfer or dispose of all or
substantially all of its property and assets, or permit any of its
Subsidiaries to do any of the foregoing, except that:
(i) the Borrower and its Subsidiaries may consummate
the Mergers;
(ii) any wholly owned Subsidiary of the Borrower may
merge into or consolidate with, or transfer all or
substantially all of its property and assets to, any other
wholly owned Subsidiary of the Borrower; and
(iii) any of the Borrower's Subsidiaries may merge
with and into the Borrower;
PROVIDED, HOWEVER, that immediately after giving effect thereto, no
event shall occur and be continuing that constitutes a Default and in
the case of any such merger to which the Borrower is a party, the
Borrower is the surviving corporation.
(e) SALES, ETC. OF ASSETS. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer
or otherwise dispose of, any assets, or grant any option or other right
to purchase, lease or otherwise acquire any Collateral (other than
Inventory to be sold in the ordinary course of business), except:
(i) sales of Inventory by the Borrower and its
Subsidiaries in the ordinary course of its business;
(ii) dispositions of property and assets by the
Borrower and its Subsidiaries in a transaction permitted by
Section 5.02(d);
(iii) dispositions for cash and fair value of
obsolete equipment and of excess or worn- out equipment (e.g.,
equipment that is no longer used in the conduct of the
Borrower's or such Subsidiary's business);
(iv) other dispositions of property and assets by the
Borrower and its Subsidiaries for cash and fair value that do
not exceed, on a Consolidated basis, an aggregate amount of
$3,000,000; and
(v) the sale of accounts receivable in an aggregate
amount not to exceed $5,000,000 and other accounts receivable
owing from any Person that shall take or be the subject of any
action or proceeding of a type described in Section 6.01(e).
(f) INVESTMENTS IN OTHER PERSONS. Make or hold, or permit any
of its Subsidiaries to make or hold, any Investment in any Person other
than:
(i) Investments by the Borrower in the Surviving
Corporation prior to the Second Merger;
(ii) Investments by the Borrower in its wholly owned
Subsidiaries (other than the Surviving Corporation) in an
aggregate amount, together, without duplication, with all
63
58
Indebtedness outstanding in accordance with Section
5.02(b)(ii)(A) not to exceed $1,000,000 at any time
outstanding; PROVIDED, HOWEVER, that, at the time of such
Investment, such Subsidiary shall be Solvent and the Agent
shall have received a certificate from the chief financial
officer of the Borrower to such effect; PROVIDED FURTHER that,
notwithstanding anything herein to the contrary, Investments
by the Borrower in Kava shall not exceed $50,000 at any time
outstanding;
(iii) Investments in Hedge Agreements required to be
maintained under Section 5.01(n);
(iv) Investments by the Borrower and its Subsidiaries
in Cash Equivalents;
(v) advances to employees of the Borrower or any of
its Subsidiaries made in the ordinary course of business in an
aggregate amount not to exceed $300,000 at any time
outstanding; and
(vi) Investments of the Borrower in Concepts in an
aggregate amount not to exceed $250,000 at any time
outstanding; PROVIDED, HOWEVER, that any such Investments
consisting of Indebtedness shall be evidenced by a promissory
note in form and substance satisfactory to the Agent and
pledged to the Collateral Agent under the Security Agreement.
(g) DIVIDENDS, ETC. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its
capital stock or any warrants, rights or options to acquire such
capital stock, now or hereafter outstanding, return any capital to its
stockholders as such, make any distribution of assets, capital stock,
warrants, rights, options, obligations or securities to its
stockholders as such, or issue or sell any capital stock or any
warrants, rights or options to acquire such capital stock, or permit
any of its Subsidiaries to purchase, redeem, retire, defease or
otherwise acquire for value any capital stock of the Borrower or any
warrants, rights or options to acquire such capital stock or to issue
or sell any capital stock or any warrants, rights or options to acquire
such capital stock, except that the Borrower may:
(i) declare and deliver dividends and distributions
payable only in common stock of the Borrower;
(ii) declare and pay dividends or distributions in
cash to Brands:
(A) to discharge the obligations of the
Borrower and its Subsidiaries under the Tax Sharing
Agreement and
(B) to discharge ordinary course operating
and administrative expenses in an amount not to
exceed $100,000 payable during any 12-month period;
and
(iii) repurchase its capital stock in the ordinary
course of business from employees, upon termination of such
employees, at fair market value in an aggregate amount not to
exceed $500,000 in any 12-month period.
PROVIDED that, in each case (other than subclause (ii)(A) above),
immediately before and immediately after giving effect thereto, no
Default shall have occurred and be continuing.
(h) PREPAYMENTS, ETC. OF INDEBTEDNESS. (i) Prepay, redeem,
purchase, defease or otherwise satisfy prior to the scheduled maturity
thereof in any manner, or make any payment in violation of any
subordination terms of, any Indebtedness, other than the prepayment of
Advances in accordance with the
64
59
terms of this Agreement or of any Indebtedness payable to the Borrower
or (ii) amend, modify or change in any manner adverse to the Agent, any
Lender, the Swing Line Bank, the Issuing Bank, any Existing Issuing
Bank or any Hedge Bank any term or condition of any Surviving
Indebtedness or any Subordinated Notes Document, or permit any of its
Subsidiaries to do any of the foregoing.
(i) NEW SUBSIDIARIES. Create, organize, incorporate or acquire
any Subsidiary (such newly created, organized, incorporated or acquired
Subsidiary being a "NEW SUBSIDIARY"), or permit any of its Subsidiaries
to create, organize, incorporate or acquire any New Subsidiary, unless:
(i) such New Subsidiary is a direct wholly owned
Subsidiary of the Borrower (other than to the extent of
qualifying shares or similar ownership interests required by
applicable law);
(ii) the Agent is reasonably satisfied with the
corporate and legal structure and capitalization of such New
Subsidiary;
(iii) such New Subsidiary executes and delivers to
the Lenders, the Swing Line Bank and the Issuing Bank, on the
date of its creation, organization, incorporation or
acquisition, (A) a security agreement, (B) a guaranty and (C)
such other agreements (including, without limitation, a
patent, trademark and copyright security agreement),
instruments, certificates or documents as the Agent may
request, in each case on terms and conditions satisfactory to
the Required Lenders; and
(iv) such New Subsidiary has taken or takes all such
other actions that may be necessary or that the Agent may deem
desirable in order to perfect and protect any pledge,
assignment or security interest granted by the security
agreements referred to in clause (iii) above (including,
without limitation, a pledge of all of the outstanding capital
stock (other than qualifying ownership shares or similar
ownership interests required by applicable law) of such New
Subsidiary to the Agent for the benefit of the Lenders, the
Swing Line Bank, the Issuing Bank and the Existing Issuing
Banks) or to enable the Agent to exercise and enforce its
rights and remedies thereunder.
(j) CHANGE IN NATURE OF BUSINESS. Make, or permit any of its
Subsidiaries to make, any material change in the nature of its business
as carried on at the date hereof.
(k) CHARTER AMENDMENTS. Amend, or permit any of its
Subsidiaries to amend (i) its charter or (ii) its bylaws if such
amendment could adversely affect the interest or rights of the Agent,
the Swing Line Bank, the Issuing Bank, the Existing Issuing Banks or
the Lenders in any manner.
(l) ACCOUNTING CHANGES. Make or permit, or permit any of its
Subsidiaries to make or permit, any change in accounting policies or
reporting practices, except (i) a change in its fiscal year which
change shall not occur more than one time, (ii) changes immediately
following the First Merger in connection with the First Merger and
(iii) as required by generally accepted accounting principles in effect
from time to time.
(m) AMENDMENT, ETC. OF RELATED DOCUMENTS. Cancel or terminate
any Related Document or consent to or accept any cancellation or
termination thereof, amend, modify or otherwise change any term or
condition of any Related Document or give any consent, waiver or
approval thereunder, waive any default under or any breach of any term
or condition of any Related Document, or take any other action in
connection with any Related Document, in each case that could impair
the value of the interest or rights of the Borrower thereunder or the
interest or rights of the Agent, the Swing Line Bank, the Issuing Bank,
65
60
the Existing Issuing Banks, the Lenders or the Hedge Banks in any
manner (it being acknowledged by the Borrower that any change in the
financial or payment terms of any such Related Document could impair
such interest or rights).
(n) NEGATIVE PLEDGE. Enter into or suffer to exist, or permit
any of its Subsidiaries to enter into or suffer to exist, any agreement
prohibiting or conditioning the creation or assumption of any Lien upon
any of its property or assets other than the Indenture and any such
agreement with the Agent, the Swing Line Bank, the Issuing Bank, the
Existing Issuing Banks and the Lenders.
(o) PARTNERSHIPS. Become a general partner in any general or
limited partnership, or permit any of its Subsidiaries to do so.
SECTION 5.03. REPORTING REQUIREMENTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any Lender, or
the Swing Line Bank, or the Issuing Bank shall have any Commitment hereunder,
the Borrower will furnish to the Lenders, the Swing Line Bank and the Issuing
Bank:
(a) DEFAULT NOTICE. As soon as possible and in any event
within two days after the occurrence of each Default continuing on the
date of such statement, a statement of the chief financial officer of
the Borrower setting forth the nature of such Default and the action
that the Borrower has taken and/or proposes to take with respect
thereto.
(b) MONTHLY FINANCIALS. As soon as available and in any event
within 30 days after the end of each month, Consolidated and
consolidating balance sheets of the Borrower and its Subsidiaries as of
the end of such month and Consolidated and consolidating statements of
income, retained earnings and cash flow of the Borrower and its
Subsidiaries for the period commencing at the end of the previous month
and ending with the end of such month and commencing at the end of the
previous fiscal year and ending with the end of such month, setting
forth in each case in comparative form the corresponding figures for
the immediately preceding month and the corresponding figures for the
corresponding month of the immediately preceding fiscal year, all in
reasonable detail and duly certified by the chief financial officer of
the Borrower, together with a schedule in form satisfactory to the
Agent of the computations used by the Borrower in determining
compliance with the covenants contained in Sections 5.02 and 5.04.
(c) QUARTERLY FINANCIALS. As soon as available and in any
event within 45 days after the end of each of the first three quarters
of each fiscal year of the Borrower, Consolidated and consolidating
balance sheets of the Borrower and its Subsidiaries as of the end of
such quarter and Consolidated and consolidating statements of income,
retained earnings and cash flow of the Borrower and its Subsidiaries
for the period commencing at the end of the previous fiscal year and
ending with the end of such quarter, and at the end of the previous
fiscal quarter and ending with the end of such quarter, setting forth
in each case in comparative form the corresponding figures for the
prior quarter and the corresponding figures for the corresponding
period of the preceding fiscal year, all in reasonable detail and duly
certified by the chief financial officer of the Borrower as having been
prepared in accordance with GAAP, together with (i) a certificate of
such officer stating that no Default has occurred and is continuing or,
if a Default has occurred and is continuing, a statement as to the
nature thereof and the action that the Borrower has taken and proposes
to take with respect thereto and (ii) a schedule in form satisfactory
to the Agent of the computations used by the Borrower in determining
compliance with the covenants contained in Sections 5.02 and 5.04.
(d) ANNUAL FINANCIALS. As soon as available and in any event
within 90 days after the end of each fiscal year of Brands, a copy of
the annual audit report for such year for Brands and its Subsidiaries,
including therein Consolidated and consolidating balance sheets of
Brands and its Subsidiaries
66
61
as of the end of such fiscal year and Consolidated and consolidating
statements of income, retained earnings and cash flow of Brands and its
Subsidiaries for such fiscal year, in each case accompanied by an
opinion reasonably acceptable to the Required Lenders of Xxxxxx
Xxxxxxxx & Co. or other independent public accountants of recognized
standing reasonably acceptable to the Agent, together with (i) a
certificate of such accounting firm to the Lenders stating that in the
course of the regular audit of the business of Brands and its
Subsidiaries, which audit was conducted by such accounting firm in
accordance with generally accepted auditing standards, such accounting
firm has obtained no knowledge that a Default has occurred and is
continuing, or if, in the opinion of such accounting firm, a Default
has occurred and is continuing, a statement as to the nature thereof,
(ii) a schedule in form satisfactory to the Agent of the computations
used by such accountants in determining, as of the end of such fiscal
year, compliance with the covenants contained in Sections 5.02 and 5.04
and the calculation of Excess Cash Flow for such fiscal year and (iii)
a certificate of the chief financial officer of the Borrower stating
that no Default has occurred and is continuing or, if a Default has
occurred and is continuing, a statement as to the nature thereof and
the action that the Borrower has taken and proposes to take with
respect thereto.
(e) ANNUAL FORECASTS. As soon as available and in any event no
later than 15 days after the end of each fiscal year of the Borrower,
forecasts prepared by management of the Borrower, in form satisfactory
to the Agent, of Consolidated and consolidating balance sheets, income
statements and cash flow statements (and any underlying assumptions
with respect thereto) on a monthly basis for the first fiscal year
following the fiscal year then ended.
(f) ACCOUNTANTS' LETTERS AND REPORTS. (i) As soon as available
and in any event prior to December 31 of each fiscal year of the
Borrower, commencing December 31, 1994, a letter from Xxxxxx Xxxxxxxx &
Co. or other independent public accountant of recognized standing
acceptable to the Required Lenders, in substantially the form of
Exhibits I hereto (or another form acceptable to the Required Lenders),
to the Agent, acknowledging that the Lenders, the Swing Line Bank and
the Issuing Bank will rely upon the financial statements of the Loan
Parties examined by, and the related reports of, such accountants for
the succeeding fiscal year in determining whether to take action or
refrain from taking action under the Loan Documents; and (ii) promptly
upon receipt thereof, copies of all reports submitted to Brands or any
of its Subsidiaries by Xxxxxx Xxxxxxxx & Co. or any other independent
public accountants of Brands or any such Subsidiary in connection with
each annual, interim or special audit of its financial statements made
by such accountants, including the comment letter submitted by such
accountants to management of Brands or any such Subsidiary in
connection with their annual audit and any reports addressing
accounting controls submitted by such accountants with respect to
Brands or such Subsidiary.
(g) PLAN ADOPTIONS, ETC. Promptly after (i) the adoption or
commitment to the adoption thereof, a copy of any new Plan of the
Borrower or any of its Subsidiaries and (ii) any amendment or
commitment to any amendment thereof, a copy of such amendment to any
Plan of the Borrower or any of its Subsidiaries.
(h) ERISA EVENTS. Promptly and in any event within ten days
after any Loan Party or any of its ERISA Affiliates knows or has reason
to know that any ERISA Event with respect to any Loan Party or any of
its ERISA Affiliates has occurred, a statement of the chief financial
officer of the Borrower describing such ERISA Event and the action, if
any, that such Loan Party or such ERISA Affiliate has taken and
proposes to take with respect thereto.
(i) PLAN TERMINATIONS. Promptly and in any event within two
Business Days after receipt thereof by any Loan Party or any of its
ERISA Affiliates, copies of each notice from the PBGC stating its
intention to terminate any Plan of any Loan Party or any of its ERISA
Affiliates or to have a trustee appointed to administer any such Plan.
67
62
(j) PLAN ANNUAL REPORTS. Promptly and in any event within 30
days after the filing thereof with the Internal Revenue Service, copies
of each Schedule B (Actuarial Information) to the annual report (form
5500 Series) with respect to each Plan of each Loan Party or any of its
ERISA Affiliates.
(k) MULTIEMPLOYER PLAN NOTICES. Promptly and in any event
within five Business Days after receipt thereof by any Loan Party or
any of its ERISA Affiliates from the sponsor of a Multiemployer Plan of
any Loan Party or any of its ERISA Affiliates, copies of each notice
concerning (i) the imposition of Withdrawal Liability by any such
Multiemployer Plan, (ii) the reorganization or termination, within the
meaning of Title IV of ERISA, of any such Multiemployer Plan or (iii)
the amount of liability incurred, or that may be incurred, by such Loan
Party or any of its ERISA Affiliates in connection with any event
described in clause (i) or (ii) above.
(l) LITIGATION. Promptly after the commencement thereof,
notice of all actions, suits, investigations (including, without
limitation, any investigation from any regulatory agency and any
reports resulting from such investigation), litigation and proceedings
before any court or governmental department, commission, board, bureau,
agency or instrumentality, domestic or foreign, affecting any Loan
Party or any of their Subsidiaries or any of their properties of the
type described in Section 4.01(j) and in each case, any other
information available to the Borrower or any of its Subsidiaries with
respect to any of the foregoing that would enable the Agent and the
Lenders to more fully evaluate such action, suit, investigation,
litigation or proceeding.
(m) SECURITIES REPORTS. Promptly after the sending or filing
thereof, copies of all proxy statements, financial statements and
reports that any Loan Party or any of its Subsidiaries sends to its
stockholders, and copies of all regular, periodic and special reports,
and all registration statements, that any Loan Party or any of its
Subsidiaries files with the Securities and Exchange Commission or any
governmental authority that may be substituted therefor, or with any
national securities exchange.
(n) CREDITOR REPORTS. Promptly after the furnishing thereof,
copies of any statement or report furnished to any other holder of the
securities of any Loan Party (including, without limitation, the
holders of the Subordinated Notes) or of any of its Subsidiaries
pursuant to the terms of any indenture, loan or credit or similar
agreement and not otherwise required to be furnished to the Lenders,
the Swing Line Bank and the Issuing Bank pursuant to any other clause
of this Section 5.03.
(o) AGREEMENT NOTICES. Promptly upon receipt thereof, copies
of all material notices, requests and other documents received by or
given to any of the Loan Parties or any of their Subsidiaries under or
pursuant to any Related Document and, from time to time upon request by
the Agent, such other information and reports regarding the Related
Documents as the Agent may reasonably request.
(p) REVENUE AGENT REPORTS. Within 10 days after receipt,
copies of all Revenue Agent Reports (Internal Revenue Service form
886), or other written proposals of the Internal Revenue Service, that
propose, determine or otherwise set forth positive or negative
adjustments to the federal income tax liability of the affiliated group
(within the meaning of Section 1504(a)(1) of the Internal Revenue Code)
of which the Borrower is a member aggregating $100,000 or more.
(q) TAX CERTIFICATES. Promptly, and in any event within five
Business Days after the due date (with extensions) for filing the final
federal income tax return in respect of each taxable year, a
certificate, signed by the president or the chief financial officer of
the Borrower, stating that the common parent of the affiliated group
(within the meaning of Section 1504(a)(1) of the Internal Revenue Code)
of which the Borrower is a member has paid to the Internal Revenue
Service or other taxing authority, or to the Borrower, the full amount
that such affiliated group is required to pay in respect of federal
income tax for
68
63
such year and that the Borrower and its Subsidiaries have received any
amounts payable to them, and have not paid amounts in respect of taxes
(federal, state, local or foreign) in excess of the amount they are
required to pay, under the Tax Sharing Agreement in respect of such
taxable year.
(r) ENVIRONMENTAL CONDITIONS. Promptly after the occurrence
thereof, notice of any condition or occurrence on any property of any
Loan Party or any of its Subsidiaries that results in a material
noncompliance by any Loan Party or any of its Subsidiaries with any
Environmental Law or Environmental Permit or could (i) form the basis
of an Environmental Action against any Loan Party or any of its
Subsidiaries or such property that could have a Material Adverse Effect
or (ii) cause any such property to be subject to any restrictions on
ownership, occupancy, use or transferability under any Environmental
Law.
(s) BORROWING BASE REPORT. Within 15 days after the end of
each fiscal month so long as there are any Revolving Credit
Commitments, a Borrowing Base Report certified by the chief financial
officer of the Borrower; PROVIDED, HOWEVER, that the Agent may, in its
sole discretion, require the Borrower to furnish a Borrowing Base
Report to the Lenders at any time upon notice to the Borrower.
(t) RECEIVABLES AGING REPORT. As soon as available and in any
event within 30 days after the end of each fiscal month, a report
prepared by the chief financial officer of the Borrower, in form and
substance satisfactory to the Agent, setting forth (i) all Obligors
under all Receivables of the Borrower and its Subsidiaries, (ii) all
Inventory of the Borrower and its Subsidiaries by general category and
(iii) an analysis as to the aging of such Receivables and such
Inventory; PROVIDED, HOWEVER, that if the first of such reports made
available to the Agent in accordance with this Section 5.03(t) is not
in form and substance satisfactory to the Agent, the Borrower shall use
its best efforts to conform such report to the Agent's requirements
within 60 days of the date of the initial Borrowing.
(u) OTHER INFORMATION. Such other information with respect to
the business, condition (financial or otherwise), operations,
performance, properties or prospects of any Loan Party or any of its
Subsidiaries as any Lender may from time to time reasonably request.
SECTION 5.04. FINANCIAL COVENANTS. So long as any Advance
shall remain unpaid, any Letter of Credit shall be outstanding or any
Lender, the Issuing Bank or the Swing Line Bank shall have any
Commitment hereunder, the Borrower will:
(a) MINIMUM NET WORTH. Maintain on a Consolidated basis for
itself and its Subsidiaries a Net Worth at all times during each fiscal
year set forth below of not less than the amount set forth below for
each such fiscal year:
==========================================================
PERIOD ENDING AMOUNT
------------- ------
----------------------------------------------------------
September 30, 1998 $46,000,000
----------------------------------------------------------
September 30, 1999 $46,500,000
----------------------------------------------------------
September 30, 2000 $48,000,000
----------------------------------------------------------
Thereafter $51,000,000
==========================================================
69
64
(b) LEVERAGE RATIO. Maintain on a Consolidated basis for
itself and its Subsidiaries a Leverage Ratio at all times during each
Rolling Period set forth below of not more than the amount set forth
below for such Rolling Period:
================================================================================
QUARTERLY ROLLING PERIOD ENDING IN RATIO
---------------------------------- -----
--------------------------------------------------------------------------------
October 1, 1997 to September 30, 1998 2.25 to 1
--------------------------------------------------------------------------------
October 1, 1998 to September 30, 1999 2.00 to 1
--------------------------------------------------------------------------------
October 1, 1999 to September 30, 2000 1.50 to 1
--------------------------------------------------------------------------------
Thereafter 1.00 to 1
================================================================================
(c) INTEREST COVERAGE RATIO. Maintain on a Consolidated basis for
itself and its Subsidiaries an Interest Coverage Ratio at all times during each
Rolling Period set forth below of not less than the amount set forth below for
such Rolling Period:
================================================================================
Quarterly Rolling Period Ending In RATIO
--------------------------------------------------------------------------------
October 1, 1997 to September 30, 1998 1.60 to 1
--------------------------------------------------------------------------------
October 1, 1998 to September 30, 1999 1.70 to 1
--------------------------------------------------------------------------------
October 1, 1999 to September 30, 2000 1.90 to 1
--------------------------------------------------------------------------------
Thereafter 2.10 to 1
================================================================================
(d) FIXED CHARGE COVERAGE RATIO. Maintain on a Consolidated basis for
itself and its Subsidiaries a Fixed Charge Coverage Ratio at all times during
each Rolling Period set forth below of not less than the amount set forth below
for such Rolling Period:
================================================================================
Quarterly Rolling Period Ending In RATIO
---------------------------------- -----
--------------------------------------------------------------------------------
October 1, 1997 to September 30, 1998 1.15 to 1
--------------------------------------------------------------------------------
October 1, 1998 to September 30, 1999 1.10 to 1
--------------------------------------------------------------------------------
Thereafter 1.05 to 1
================================================================================
(E) CAPITAL EXPENDITURES. Not make, or permit any of its Subsidiaries
to make, any Capital Expenditures that would cause the aggregate of all Capital
Expenditures made by the Borrower and its Subsidiaries on a Consolidated basis
in any period set forth below to exceed the amount set forth below for such
period:
70
65
================================================================================
PERIOD AMOUNT
------ ------
--------------------------------------------------------------------------------
October 1, 1997 to September 30, 1998 $7,000,000
--------------------------------------------------------------------------------
October 1, 1998 to September 30, 1999 $5,500,000
--------------------------------------------------------------------------------
October 1, 1999 to September 30, 2000 $5,500,000
--------------------------------------------------------------------------------
Thereafter $4,125,000
================================================================================
PROVIDED, HOWEVER, that if, at the end of any fiscal year set forth above, the
amount specified above for such fiscal year exceeds the amount of Capital
Expenditures made by the Borrower and its Subsidiaries during such fiscal year,
the Borrower and its Subsidiaries shall be entitled to make additional Capital
Expenditures in the immediately succeeding fiscal year in an amount equal to 50%
of the amount of such excess from the immediately preceding fiscal year of the
Borrower set forth above."
(f) MINIMUM EBITDA. Maintain on a Consolidated basis for itself and its
Subsidiaries minimum EBITDA as at the end of each Rolling Period during each
fiscal year set forth below of not less than the amount set forth below for each
such fiscal year:
==========================================================
PERIOD ENDING AMOUNT
----------------------------------------------------------
December 31, 1997 $28,500,000
----------------------------------------------------------
March 31, 1998 $29,000,000
----------------------------------------------------------
June 30, 1998 $29,500,000
----------------------------------------------------------
September 30, 1998 $30,000,000
----------------------------------------------------------
December 31, 1998 $30,500,000
----------------------------------------------------------
March 31, 1999 $31,000,000
----------------------------------------------------------
June 30, 1999 $31,500,000
----------------------------------------------------------
September 30, 1999 $32,000,000
----------------------------------------------------------
December 31, 1999 $33,500,000
----------------------------------------------------------
March 31, 2000 $34,000,000
----------------------------------------------------------
June 30, 2000 $34,500,000
----------------------------------------------------------
September 30, 2000 $35,000,000
----------------------------------------------------------
December 31, 2000 $35,500,000
----------------------------------------------------------
March 31, 2001 $36,000,000
----------------------------------------------------------
June 30, 2001 $36,500,000
==========================================================
71
66
ARTICLE VI
EVENTS OF DEFAULT
SECTION 6.01. EVENTS OF DEFAULT. If any of the following
events ("EVENTS OF DEFAULT") shall occur and be continuing:
(a) the Borrower shall fail to pay any principal of, or
interest on, any Advance, or any Loan Party shall fail to make any
other payment under any Loan Document, in each case when the same
becomes due and payable; or
(b) any representation or warranty made by any Loan Party (or
any of its officers) under or in connection with any Loan Document
shall prove to have been incorrect in any material respect when made;
or
(c) (i) the Borrower shall fail to perform or observe any
term, covenant or agreement contained in Section 5.01(b), 5.01(e),
5.01(f), 5.01(g), 5.01(m), 5.01(p), 5.02, 5.03 (other than Sections
5.03(b), (c) and (d)) or 5.04 or (ii) any Loan Party shall fail to
perform any other term, covenant or agreement contained in any Loan
Document on its part to be performed or observed if such failure shall
remain unremedied for 20 days after written notice thereof shall have
been given to the Borrower by the Agent or any Lender; or
(d) any of the Loan Parties or any of their Subsidiaries shall
fail to pay any principal of, premium or interest on or any other
amount payable in respect of any Indebtedness that is outstanding in a
principal amount of at least $250,000 in the aggregate (but excluding
Indebtedness outstanding hereunder) of such Loan Party or such
Subsidiary, as the case may be, when the same becomes due and payable
(whether by scheduled maturity, required prepayment, acceleration,
demand or otherwise); or any other event shall occur or condition shall
exist under any agreement or instrument relating to any such
Indebtedness, if the effect of such event or condition is to
accelerate, or to permit the acceleration of, the maturity of such
Indebtedness or otherwise to cause, or to permit the holder thereof to
cause, such Indebtedness to mature; or any such Indebtedness shall have
become due and payable or required to be prepaid or redeemed (other
than by a regularly scheduled required prepayment or redemption),
purchased or defeased, or an offer to prepay, redeem, purchase or
defease such Indebtedness shall be required to be made, in each case
prior to the stated maturity thereof; or
(e) any Loan Party or any of its Subsidiaries shall generally
not pay its debts as such debts become due, or shall admit in writing
its inability to pay its debts generally, or shall make a general
assignment for the benefit of creditors; or any proceeding shall be
instituted by or against any Loan Party or any of its Subsidiaries
seeking to adjudicate it a bankrupt or insolvent, or seeking
liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law
relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment
of a receiver, trustee, or other similar official for it or for any
substantial part of its property and, in the case of any such
proceeding instituted against it (but not instituted by it) that is
being diligently contested by it in good faith, either such
72
67
proceeding shall remain undismissed or unstayed for a period of 30 days
or any of the actions sought in such proceeding (including, without
limitation, the entry of an order for relief against, or the
appointment of a receiver, trustee, custodian or other similar official
for, it or any substantial part of its property) shall occur; or any
Loan Party or any of its Subsidiaries shall take any corporate action
to authorize any of the actions set forth above in this Section
6.01(e); or
(f) any one or more judgments or orders for the payment of
money that, either individually or in the aggregate, exceed $250,000
shall be rendered against any Loan Party or any of its Subsidiaries and
either (i) enforcement proceedings shall have been commenced properly
by any creditor upon such judgments or orders or (ii) there shall be
any period of 10 consecutive days during which a stay of enforcement of
such judgments or orders, by reason of a pending appeal or otherwise,
shall not be in effect; or
(g) any nonmonetary judgment or order shall be rendered
against any Loan Party or any of its Subsidiaries that is reasonably
likely to have a Material Adverse Effect, and 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
(h) any provision of any Loan Document after delivery thereof
pursuant to Section 3.01 shall for any reason cease to be valid and
binding on or enforceable against any Loan Party to it in any material
respect, or any such Loan Party shall so state in writing; or
(i) except as otherwise permitted by this Agreement, any
Collateral Document after delivery thereof pursuant to Section 3.01
shall for any reason (other than pursuant to the terms thereof) cease
to create a valid and perfected first priority Lien on any Collateral
purported to be covered thereby; or
(j) Brands shall at any time for any reason cease to be the
record and beneficial owner of 100% of the outstanding capital stock of
the Borrower; or
(k) (i) The Equity Investors shall cease to own Voting Stock
of Brands representing at least 50% of the combined voting power of all
Voting Stock of Brands that the Equity Investors own on the date hereof
or (ii) any transaction (including a merger or consolidation) shall
occur which results in any Person or "group" (within the meaning of
Sections 13(d) and 14(d)(2) of the Exchange Act), other than the Equity
Investors, becoming the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act) directly or indirectly of the Voting Stock of
Brands having combined voting power equal to or greater than the voting
power of the Voting Stock owned by the Equity Investors; or
(l) any ERISA Event shall have occurred with respect to a Plan
of any Loan Party or any of its ERISA Affiliates and the sum
(determined as of the date of occurrence of such ERISA Event) of the
Insufficiency of such Plan and the Insufficiency of any and all other
Plans of the Loan Parties and their ERISA Affiliates with respect to
which an ERISA Event shall have occurred and then exist (or the
liability of the Loan Parties and their ERISA Affiliates related to
such ERISA Event) exceeds $250,000; or
(m) any Loan Party or any of its ERISA Affiliates shall have
been notified by the sponsor of a Multiemployer Plan of any Loan Party
or any of its ERISA Affiliates that it has incurred Withdrawal
Liability to such Multiemployer Plan in an amount that, when
73
68
aggregated with all other amounts required to be paid to Multiemployer
Plans by the Loan Parties and their ERISA Affiliates as Withdrawal
Liability (determined as of the date of such notification), exceeds
$250,000 or requires payments exceeding $100,000 per annum; or
(n) any Loan Party or any of its ERISA Affiliates shall have
been notified by the sponsor of a Multiemployer Plan of any Loan Party
or any of its ERISA Affiliates that such Multiemployer Plan is in
reorganization or is being terminated, within the meaning of Title IV
of ERISA, and as a result of such reorganization or termination the
aggregate annual contributions of the Loan Parties and their ERISA
Affiliates to all Multiemployer Plans that are then in reorganization
or being terminated have been or will be increased over the amounts
contributed to such Multiemployer Plans for the plan years of such
Multiemployer Plans immediately preceding the plan year in which such
reorganization or termination occurs by an amount exceeding $250,000;
or
then, and in any such event, the Agent (i) shall at the request, or may with the
consent, of the Required Lenders, by notice to the Borrower, declare the
obligation of each Appropriate Lender to make Advances (other than Letter of
Credit Advances and Swing Line Advances) and the Issuing Bank to issue Letters
of Credit and the Swing Line Bank to make Swing Line Advances to be terminated,
whereupon the same shall forthwith terminate, and (ii) shall at the request, or
may with the consent, of the Required Lenders, (A) by notice to the Borrower,
declare the Notes, all interest thereon and all other amounts payable under this
Agreement and the other Loan Documents to be forthwith due and payable,
whereupon the Notes, all such interest and all such amounts shall become and be
forthwith due and payable, without presentment, demand, protest or further
notice of any kind, all of which are hereby expressly waived by the Borrower,
and (B) by notice to each party required under the terms of any agreement in
support of which a Standby Letter of Credit is issued, request that all
Obligations under such agreement be declared to be due and payable; PROVIDED,
HOWEVER, that upon any such event described in Section 6.01(e) with respect to
any Loan Party (other than generally not paying its debts as such debts become
due or admitting in writing its inability to pay its debts generally), (1) the
obligation of each Lender to make Advances (other than Letter of Credit Advances
and Swing Line Advances) and the Issuing Bank to issue Letters of Credit and the
Swing Line Bank to make Swing Line Advances shall automatically be terminated
and (2) the Notes, all such interest and all such amounts shall automatically
become and be due and payable, without presentment, demand, protest or any
notice of any kind, all of which are hereby expressly waived by the Borrower.
SECTION 6.02. ACTIONS IN RESPECT OF LETTERS OF CREDIT UPON
EVENT OF DEFAULT. If any Event of Default shall have occurred and be continuing,
the Agent may, irrespective of whether it is taking any of the actions described
in Section 6.01 or otherwise, make demand upon the Borrower to, and forthwith
upon such demand the Borrower will, pay to the Agent on behalf of the Lenders in
same day funds at the Agent's office designated in such demand, for deposit in
the L/C Cash Collateral Account, an amount equal to 105% of the aggregate
Available Amount of all Letters of Credit then outstanding. If at any time the
Agent determines that any funds held in the L/C Cash Collateral Account are
subject to any right or claim of any Person other than the Agent, the Lenders,
the Issuing Bank, the Swing Line Bank, the Existing Issuing Banks and the Hedge
Banks or that the total amount of such funds is less than 105% of the aggregate
Available Amount of all Letters of Credit, the Borrower will, forthwith upon
demand by the Agent, pay to the Agent, as additional funds to be deposited and
held in the L/C Cash Collateral Account, an amount equal to the excess of (a)
105% of such aggregate Available Amount over (b) the total amount of funds, if
any, held in the L/C Cash Collateral Account that the Agent determines to be
free and clear of any such right and claim at the time of such demand.
74
69
ARTICLE VII
THE AGENTS
SECTION 7.01. AUTHORIZATION AND ACTION. Each Lender, the
Issuing Bank, the Swing Line Bank, the Syndication Agent, the Documentation
Agent and each Existing Issuing Bank hereby appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers and
discretion under this Agreement and the other Loan Documents as are delegated to
the Agent by the terms hereof and thereof, together with such powers and
discretion as are reasonably incidental thereto. As to any matters not expressly
provided for by the Loan Documents (including, without limitation, enforcement
or collection of the Notes), the Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Required Lenders, or all the Lenders, as the case
may be, and such instructions shall be binding upon all Lenders, the Issuing
Bank, all Existing Issuing Banks and all holders of Notes; PROVIDED, HOWEVER,
that the Agent shall not be required to take any action that exposes the Agent
to personal liability or that is contrary to this Agreement or applicable law.
The Agent agrees to give to each Lender, the Issuing Bank and each Existing
Issuing Bank prompt notice of each notice given to it by the Borrower pursuant
to the terms of this Agreement.
SECTION 7.02. AGENTS' RELIANCE, ETC. None of the Agents nor
any of their respective directors, officers, agents or employees shall be liable
for any action taken or omitted to be taken by it or them under or in connection
with the Loan Documents, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, each of the
Agents: (a) may treat the payee of any Note as the holder thereof until the
Agent receives and accepts an Assignment and Acceptance entered into by the
Lender that is the payee of such Note, as assignor, and an Eligible Assignee, as
assignee, as provided in Section 8.07; (b) may consult with legal counsel
(including, without limitation, counsel for any Loan Party), independent public
accountants and other experts selected by it and shall not be liable for any
action taken or omitted to be taken in good faith by it in accordance with the
advice of such counsel, accountants or experts; (c) makes no warranty or
representation to any Lender, the Swing Line Bank, the Issuing Bank or any
Existing Issuing Bank and shall not be responsible to any Lender, the Swing Line
Bank, the Issuing Bank or any Existing Issuing Bank for any statements,
warranties or representations made in or in connection with the Loan Documents;
(d) shall not have any duty to ascertain or to inquire as to the performance or
observance of any of the terms, covenants or conditions of any Loan Document on
the part of any Loan Party or to inspect the property (including the books and
records) of any Loan Party; (e) shall not be responsible to any Lender, the
Swing Line Bank, the Issuing Bank or any Existing Issuing Bank for the due
execution, legality, validity, enforceability, genuineness, sufficiency or value
of, or the perfection or priority of any lien or security interest created or
purported to be created under or in connection with, any Loan Document or any
other instrument or document furnished pursuant hereto; (f) shall incur no
liability under or in respect of any Loan Document by acting upon any notice,
consent, certificate or other instrument or writing (which may be by telegram,
telecopy, cable or telex) believed by it to be genuine and signed or sent by the
proper party or parties; and (g) shall incur no liability as a result of any
determination whether the transactions contemplated by the Loan Documents
constitute a "highly leveraged transaction" within the meaning of the
interpretations issued by the Comptroller of the Currency, the Federal Deposit
Insurance Corporation and the Board of Governors of the Federal Reserve System.
SECTION 7.03. EACH AGENT AND ITS AFFILIATES. With respect to
its Commitments, the Advances made by it, and the Note or Notes issued to it,
each of the Agents shall have the same
75
70
rights and powers under the Loan Documents as any other Lender and may exercise
the same as though it were not an Agent; and the term "LENDER" or "LENDERS"
shall, unless otherwise expressly indicated, include each of the Agents in its
individual capacity. Each of the Agents and its respective affiliates may accept
deposits from, lend money to, act as trustee under indentures of, accept
investment banking engagements from and generally engage in any kind of business
with, any Loan Party, any of its Subsidiaries and any Person who may do business
with or own securities of any Loan Party or any such Subsidiary, all as if such
Agent were not an Agent and without any duty to account therefor to the Lenders,
the Issuing Bank, the Swing Line Bank or the Existing Issuing Banks.
SECTION 7.04. LENDER CREDIT DECISION. Each Lender, the Swing
Line Bank, the Issuing Bank and each Existing Issuing Bank acknowledges that it
has, independently and without reliance upon any of the Agents, the Swing Line
Bank, the Issuing Bank and each Existing Issuing Bank or any other Lender and
based on the financial statements referred to in Section 4.01 and such other
documents and information as it has deemed appropriate, made its own credit
analysis and decision to enter into this Agreement. Each Lender, the Swing Line
Bank, the Issuing Bank and each Existing Issuing Bank also acknowledges that it
will, independently and without reliance upon any of the Agents, the Swing Line
Bank, the Issuing Bank, any other Existing Issuing Bank 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.
SECTION 7.05. INDEMNIFICATION. (a) Each Lender severally
agrees to indemnify each of the Agents (to the extent not promptly reimbursed by
the Borrower) from and against such Lender's ratable share of any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements of any kind or nature whatsoever that may be
imposed on, incurred by, or asserted against such Agent in any way relating to
or arising out of the Loan Documents or any action taken or omitted to be taken
by such Agent under the Loan Documents; PROVIDED, HOWEVER, that no Lender shall
be liable for any portion of such liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements resulting
from such Agent's gross negligence or willful misconduct. Without limitation of
the foregoing, each Lender agrees to reimburse each of the Agents promptly upon
demand for its ratable share of any costs and expenses payable by the Borrower
under Section 8.04, to the extent that such Agent is not promptly reimbursed for
such costs and expenses by the Borrower. For purposes of this Section 7.05, the
Lenders' respective ratable shares of any amount shall be determined, at any
time, according to the sum of (i) the aggregate principal amount of the Advances
outstanding at such time and owing to the respective Lenders PLUS (ii) the
aggregate Available Amount of all Letters of Credit outstanding at such time and
(iii) if no Advances and no Letters of Credit are outstanding at such time,
their respective Unused Revolving Credit Commitments at such time. In the event
that any Defaulted Advance shall be owing by any Defaulting Lender at any time,
such Lender's Commitment shall be considered to be unused for purposes of this
Section 7.05 to the extent of the amount of such Defaulted Advance. The failure
of any Lender to reimburse any of the Agents promptly upon demand for its
ratable share of any amount required to be paid by the Lenders to such Agent as
provided herein shall not relieve any other Lender of its obligation hereunder
to reimburse such Agent for its ratable share of such amount, but no Lender
shall be responsible for the failure of any other Lender to reimburse such Agent
for such other Lender's ratable share of such amount.
(b) Each Lender severally agrees to indemnify the Issuing Bank
and each Existing Issuing Bank (to the extent not otherwise reimbursed by the
Borrower) from and against such Lender's ratable share (determined as provided
below) of any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever that may be imposed on, incurred by or asserted against the
Issuing Bank or such Existing
76
71
Issuing Bank in any way relating to or arising out of any Letter of Credit or
any action taken or omitted to be taken by the Issuing Bank or such Existing
Issuing Bank in connection with such Letter of Credit; PROVIDED, HOWEVER, that
no Lender shall be liable for any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the Issuing Bank's or such Existing Issuing Bank's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender agrees to reimburse the Issuing Bank and each Existing Issuing Bank
promptly upon demand for its ratable share of any costs and expenses (including,
without limitation, any expenses incurred under Section 2.07(b)(ii)) payable by
the Borrower under Section 8.04 to the extent that the Issuing Bank or such
Existing Issuing Bank is not promptly reimbursed for such costs and expenses by
the Borrower. For purposes of this Section 7.05(b), each Lender's ratable share
of any amount shall be determined, at any time, according to the sum of (i) such
Lender's Pro Rata Share of the aggregate Available Amount of all Letters of
Credit outstanding at such time PLUS (ii) such Lender's Pro Rata Share of the
aggregate outstanding Letter of Credit Advances made by the Issuing Bank and
each Existing Issuing Bank and not funded by the Lenders pursuant to Section
2.03(c) at such time PLUS (iii) if no Advances and no Letters of Credit are
outstanding at such time, such Lender's Unused Revolving Credit Commitment at
such time PLUS (iv) such Lender's Pro Rata Share of the aggregate principal
amount of Swing Line Advances made by the Swing Line Bank. In the case of any
investigation, litigation or proceeding giving rise to any Indemnified Costs,
this Section 7.05 applies whether any such investigation, litigation or
proceeding is brought by any of the Agents, any Lender, or a third party. In the
event that any Defaulted Advance shall be owing by any Defaulting Lender at any
time, such Lender's Commitment shall be considered to be unused for purposes of
this Section 7.05 to the extent of the amount of such Defaulted Advance. The
failure of any Lender to reimburse the Issuing Bank or any Existing Issuing Bank
under this Section 7.05(b) shall not relieve any other Lender of its obligation
hereunder to reimburse the Issuing Bank or such Existing Issuing Bank for its
ratable share of such amount, but no Lender shall be responsible for the failure
of any other Lender to reimburse the Issuing Bank or such Existing Issuing Bank
for such other Lender's ratable share of such amount.
SECTION 7.06. SUCCESSOR AGENTS. (a) Each of the Agents may
resign from either or both of the Facilities at any time by giving written
notice thereof to the Lenders, the Swing Line Bank, the Issuing Bank, the
Existing Issuing Banks and the Borrower, PROVIDED that such resignation shall
not be effective prior to the appointment of a successor Agent in accordance
with this Agreement. Upon any such resignation, the Required Lenders shall have
the right to appoint a successor Agent as to such of the Facilities as to which
each of the Agents has resigned. 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, then
the retiring Agent may on behalf of the Lenders, the Swing Line Bank, the
Issuing Bank and the Existing Issuing Banks appoint a successor Agent, which
shall be a commercial bank organized under the laws of the United States or of
any state thereof and having a combined capital and surplus of at least
$750,000,000. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent as to both of the Facilities and upon the execution and filing
or recording of such financing statements, or amendments thereto, and such other
instruments or notices as may be necessary or desirable, or as the Required
Lenders may request, in order to continue the perfection of the Liens granted or
purported to be granted by the Collateral Documents, such successor Agent shall
succeed to and become vested with all the rights, powers, discretion, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations under the Loan Documents. Upon the acceptance of
any appointment as Agent hereunder by a successor Agent as to only one of the
Facilities and upon the execution and filing or recording of such financing
statements, or amendments thereto, and such other instruments or notices as may
be necessary or desirable, or as the Required Lenders may request, in order to
continue the perfection of the Liens granted or purported to
77
72
be granted by the Collateral Documents, such successor Agent shall succeed to
and become vested with all the rights, powers, discretion, privileges and duties
of the retiring Agent as to such Facility, and the retiring Agent shall be
discharged from its duties and obligations under this Agreement as to such
Facility, other than as aforesaid. After any retiring Agent's resignation
hereunder as Agent as to both of the Facilities, the provisions of this Article
VII shall inure to its benefit as to any actions taken or omitted to be taken by
it while it was Agent as to any of the Facilities under this Agreement.
(b) The Syndication Agent or the Documentation Agent may
resign at any time by giving written notice thereof to the Lenders and the
Borrower and neither of such Agents shall have any duties or obligations under
this Agreement or the other Loan Documents in their capacities as such Agents.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. AMENDMENTS, ETC. No amendment or waiver of any
provision of this Agreement or the Notes, nor consent to any departure by the
Borrower 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 specific purpose
for which given; PROVIDED, HOWEVER, that (a) no amendment, waiver or consent
shall, unless in writing and signed by all the Lenders (other than any Lender
that is a Defaulting Lender at such time unless such Defaulting Lender is timely
contesting in good faith the Defaulted Advances or Defaulted Amounts of such
Defaulting Lender) and the Issuing Bank, do any of the following at any time:
(i) waive any of the conditions specified in Section 3.01 or, in the case of the
initial Borrowing, Section 3.02, (ii) change the percentage of the Commitments
or of the aggregate unpaid principal amount of the Notes, or the number of
Lenders, that shall be required for the Lenders or any of them to take any
action hereunder, (iii) release all or substantially all of the Collateral, (iv)
amend this Section 8.01 or (v) change the reference to "$34,500,000" in Section
2.03(a); (b) no amendment, waiver or consent shall, unless in writing and signed
by the Required Lenders and each Lender that has or is owed Obligations under
the Loan Documents that are modified by such amendment, waiver or consent, do
any of the following: (i) increase the Commitments of such Lender or the Issuing
Bank or subject such Lender or the Issuing Bank to any additional obligations,
(ii) reduce the principal of, or interest on, the Note or Notes held by such
Lender any fees or other amounts payable hereunder to such Lender, (iii)
postpone any date fixed for any payment of principal of, or interest on, the
Note or Notes held by such Lender or any fees or other amounts payable hereunder
to such Lender or (iv) change the order of application of any prepayment set
forth in Section 2.05 in any manner that materially affects such Lender; and (c)
no amendment, waiver or consent shall, unless in writing and signed by the
Issuing Bank and each Existing Issuing Bank in addition to the Lenders required
above to take such action, affect the rights or obligations of the Issuing Bank
and such Existing Issuing Bank, respectively, under this Agreement; PROVIDED
FURTHER that, in any case, no amendment, waiver or consent shall, unless in
writing and signed by the Agent in addition to the Lenders and the Issuing Bank
required above to take such action, affect the rights or duties of the Agent
under this Agreement or any Note.
SECTION 8.02. NOTICES, ETC. All notices and other
communications provided for hereunder shall be in writing (including
telegraphic, telecopy, telex or cable communication) and mailed, telegraphed,
telecopied, telexed, cabled or delivered, if to the Borrower, at its address at
Signature Brands, Inc., 0000 Xxxxxxx Xxxx, Xxxxxxxxxx, Xxxx Attention:
President, telecopier
78
73
number (000) 000-0000; if to any Bank, the Swing Line Bank, the Issuing Bank or
any Existing Issuing Bank, at its Domestic Lending Office specified opposite its
name on Schedule I hereto; if to any other Lender, at its Domestic Lending
Office specified in the Assignment and Acceptance pursuant to which it became a
Lender; if to BNP, at its address at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Loan Structuring Group, telecopier number (000) 000-0000; or, as to
each party, at such other address as shall be designated by such party in a
written notice to the other parties. All such notices and communications shall,
when mailed, telegraphed, telecopied, telexed or cabled, be effective when
deposited in the mails, delivered to the telegraph company, transmitted by
telecopier, confirmed by telex answerback or delivered to the cable company,
respectively, addressed as aforesaid, except that notices and communications to
the Agent pursuant to Article II, III or VII shall not be effective until
received by the Agent.
SECTION 8.03. NO WAIVER; REMEDIES. No failure on the part of
any Lender, the Issuing Bank, any Existing Issuing Bank or the Agent to
exercise, and no delay in exercising, any right hereunder or under any Note
shall operate as a waiver thereof; nor shall any single or partial exercise of
any such right preclude any other or further exercise thereof or the exercise of
any other right. The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.
SECTION 8.04. COSTS AND EXPENSES. (a) The Borrower agrees to
pay on demand (i) all reasonable and documented costs and expenses of the Agent
in connection with the preparation, execution, delivery, administration,
modification and amendment of the Loan Documents (including, without limitation,
(A) all due diligence, transportation, computer, duplication, appraisal, audit,
insurance, consultant, search, filing and recording fees and expenses and (B)
the fees and expenses of counsel for the Agent with respect thereto, with
respect to advising the Agent as to its rights and responsibilities, or the
perfection, protection or preservation of rights or interests, under the Loan
Documents, with respect to negotiations with any Loan Party or with other
creditors of any Loan Party or any of its Subsidiaries arising out of any
Default or any events or circumstances that may give rise to a Default and with
respect to presenting claims in or otherwise participating in or monitoring any
bankruptcy, insolvency or other similar proceeding involving creditors' rights
generally and any proceeding ancillary thereto) and (ii) all costs and expenses
of the Agent, the Issuing Bank, the Swing Line Bank, the Syndication Agent, the
Documentation Agent, the Existing Issuing Banks and the Lenders in connection
with the enforcement of the Loan Documents, whether in any action, suit or
litigation, any bankruptcy, insolvency or other similar proceeding affecting
creditors' rights generally or otherwise (including, without limitation, the
fees and expenses of counsel for the Agent, the Issuing Bank, the Swing Line
Bank, the Syndication Agent, the Documentation Agent, each Existing Issuing Bank
and each Lender with respect thereto).
(b) The Borrower agrees to indemnify and hold harmless the
Agent, each Lender, the Issuing Bank, the Swing Line Bank, the Syndication
Agent, the Documentation Agent, each Existing Issuing Bank and each of their
Affiliates and their officers, directors, employees, agents and advisors (each,
an "INDEMNIFIED PARTY") from and against any and all claims that may be asserted
against, and any and all damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be
incurred by or awarded against, any Indemnified Party, in each case arising out
of or in connection with or by reason of, or in connection with the preparation
for a defense of, any investigation, litigation or proceeding arising out of,
related to or in connection with this Agreement, any other Loan Document or any
Commitment of a Lender or the Issuing Bank hereunder, including, without
limitation, (i) any acquisition or proposed acquisition (including, without
limitation, the Mergers and any of the other transactions contemplated hereby or
thereby) by Brands, the Borrower or any of their Subsidiaries or Affiliates of
all or any portion of the
79
74
capital stock or substantially all of the assets of Mr. Coffee or Acquisition or
(ii) the actual or alleged presence of Hazardous Materials on any property of
any Loan Party or any of its Subsidiaries or any Environmental Action relating
in any way to any Loan Party or any of its Subsidiaries, in each case whether or
not such investigation, litigation or proceeding is brought by any Loan Party,
its directors, shareholders or creditors or an Indemnified Party or any
Indemnified Party is otherwise a party thereto and whether or not the
transactions contemplated hereby are consummated, except to the extent such
claim, damage, loss, liability or expense is found in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Indemnified Party's gross negligence or willful misconduct. The Borrower also
agrees not to assert any claim against the Agent, any Lender, the Issuing Bank,
the Swing Line Bank, the Syndication Agent, the Documentation Agent, any
Existing Issuing Bank or any of their affiliates, or any of their respective
directors, officers, employees, attorneys and agents, on any theory of
liability, for special, indirect, consequential or punitive damages arising out
of or otherwise relating to any of the transactions contemplated herein or in
any other Loan Document or the actual or proposed use of the proceeds of the
Advances.
(c) If any payment of principal of, or Conversion of, any
Eurodollar Rate Advance is made by the Borrower to or for the account of a
Lender other than on the last day of the Interest Period for such Advance, as a
result of a payment or conversion pursuant to Section 2.08(b)(i) or 2.09(d),
acceleration of the maturity of the Notes pursuant to Section 6.01 or for any
other reason, the Borrower shall, upon demand by such Lender (with a copy of
such demand to the Agent), pay to the Agent for the account of such Lender any
amounts required to compensate such Lender for any additional losses, costs or
expenses that it may reasonably incur as a result of such payment, including,
without limitation, any loss (including loss of anticipated profits), cost or
expense incurred by reason of the liquidation or reemployment of deposits or
other funds acquired by any Lender to fund or maintain such Advance.
(d) If any Loan Party fails to pay when due any costs,
expenses or other amounts payable by it under any Loan Document, including,
without limitation, fees and expenses of counsel and indemnities, such amount
may be paid on behalf of such Loan Party by the Agent or any Lender, in its sole
discretion.
SECTION 8.05. RIGHT OF SETOFF. Upon (a) the occurrence and
during the continuance of any Event of Default and (b) the making of the request
or the granting of the consent specified by Section 6.01 to authorize the Agent
to declare the Notes due and payable pursuant to the provisions of Section 6.01,
each Lender, the Issuing Bank, each Existing Issuing Bank and each of its
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and otherwise apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender, the Issuing Bank,
such Existing Issuing Bank or such Affiliate to or for the credit or the account
of the Borrower against any and all of the Obligations of the Borrower now or
hereafter existing under this Agreement and the Note or Notes held by such
Lender, irrespective of whether such Lender, the Issuing Bank or such Existing
Issuing Bank shall have made any demand under this Agreement or such Note or
Notes and although such obligations may be unmatured. Each Lender, the Issuing
Bank and each Existing Issuing Bank agrees promptly to notify the Borrower after
any such setoff and application; PROVIDED, HOWEVER, that the failure to give
such notice shall not affect the validity of such setoff and application. The
rights of each Lender, the Issuing Bank, each Existing Issuing Bank and their
Affiliates under this Section 8.05 are in addition to other rights and remedies
(including, without limitation, other rights of setoff) that such Lender, the
Issuing Bank, such Existing Issuing Bank and its Affiliates may have.
80
75
SECTION 8.06. BINDING EFFECT. This Agreement shall become
effective when it shall have been executed by the Borrower and the Agent and
when the Agent shall have been notified by each Bank that such Bank has executed
it and thereafter shall be binding upon and inure to the benefit of the
Borrower, the Agent, the Issuing Bank, the Swing Line Bank, the Syndication
Agent, the Documentation Agent, each Existing Issuing Bank and each Lender and
their respective successors and assigns, except that the Borrower shall not have
the right to assign its rights hereunder or any interest herein without the
prior written consent of all of the Lenders, the Issuing Bank, the Swing Line
Bank, the Syndication Agent, the Documentation Agent and the Existing Issuing
Banks.
SECTION 8.07. ASSIGNMENTS AND PARTICIPATIONS. (a) Each Lender
may assign to one or more banks or other entities all or a portion of its rights
and obligations under this Agreement (including, without limitation, all or a
portion of its Commitment or Commitments, the Advances owing to it and the Note
or Notes held by it); PROVIDED, HOWEVER, that (i) each such assignment shall be
of a uniform, and not a varying, percentage of all rights and obligations under
and in respect of one or more Facilities, (ii) except in the case of an
assignment to a Person that, immediately prior to such assignment, was a Lender
or an assignment of all of a Lender's rights and obligations under this
Agreement, the amount of the Commitment of the assigning Lender being assigned
pursuant to each such assignment (determined as of the date of the Assignment
and Acceptance with respect to such assignment) shall in no event be less than
$5,000,000 and shall be an integral multiple of $1,000,000, (iii) each such
assignment shall be to an Eligible Assignee or to an Affiliate of the assignor
and (iv) the parties to each such assignment shall execute and deliver to the
Agent, for its acceptance and recording in the Register, an Assignment and
Acceptance, together with any Note or Notes subject to such assignment and a
processing and recordation fee of $2,000. Upon such execution, delivery,
acceptance and recording, from and after the effective date specified in such
Assignment and Acceptance, (A) the assignee thereunder shall be a party hereto
and, to the extent that rights and obligations hereunder have been assigned to
it pursuant to such Assignment and Acceptance, have the rights and obligations
of a Lender hereunder and (B) the Lender assignor thereunder shall, to the
extent that rights and obligations hereunder have been assigned by it pursuant
to such Assignment and Acceptance, relinquish its rights and be released from
its obligations under this Agreement (and, in the case of an Assignment and
Acceptance covering all or the remaining portion of an assigning Lender's rights
and obligations under this Agreement, such Lender shall cease to be a party
hereto).
(b) 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 as
provided in such Assignment and Acceptance, such assigning Lender makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with this
Agreement or the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Agreement or any other instrument or document
furnished pursuant hereto; (ii) such assigning Lender makes no representation or
warranty and assumes no responsibility with respect to the financial condition
of the Borrower or the performance or observance by the Borrower of any of its
obligations under this Agreement or any other instrument or document furnished
pursuant hereto; (iii) such assignee confirms that it has received a copy of
this Agreement, together with copies of the financial statements referred to in
Section 4.01 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon any of the Agents, such assigning Lender 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 confirms that it is an Eligible Assignee
or an Affiliate of the assignor; (vi) such assignee appoints and authorizes the
Agent to take such action as agent on its behalf and to exercise
81
76
such powers and discretion under this Agreement as are delegated to the Agent by
the terms hereof, together with such powers and discretion as are reasonably
incidental thereto; and (vii) such assignee agrees that it will perform in
accordance with their terms all of the obligations that by the terms of this
Agreement are required to be performed by it as a Lender.
(c) The Agent shall maintain at its address referred to in
Section 8.02 a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Lenders and the Commitment under each Facility of, and principal amount of the
Advances owing under each Facility to, each Lender from time to time (the
"REGISTER"). The entries in the Register shall be conclusive and binding for all
purposes, absent manifest error, and the Borrower, the Agent and the Lenders may
treat each Person whose name 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.
(d) Upon its receipt of an Assignment and Acceptance executed
by an assigning Lender and an assignee, together with any Note or Notes subject
to such assignment, the Agent shall, if such Assignment and Acceptance has been
completed and is in substantially the form of Exhibit C hereto, (i) accept such
Assignment and Acceptance, (ii) record the information contained therein in the
Register and (iii) give prompt notice thereof to the Borrower. Within five
Business Days after its receipt of such notice, the Borrower, at its own
expense, shall execute and deliver to the Agent in exchange for the surrendered
Note or Notes a new Note or Notes to the order of such Eligible Assignee in an
amount equal to the Commitment assumed by it under the Facilities pursuant to
such Assignment and Acceptance and, if the assigning Lender has retained a
Commitment hereunder under one or both Facilities, a new Note or Notes to the
order of the assigning Lender in an amount equal to the Commitment retained by
it hereunder. Such new Note or Notes shall be in an aggregate principal amount
equal to the aggregate principal amount of such surrendered Note or Notes, shall
be dated the effective date of such Assignment and Acceptance and shall
otherwise be in substantially the form of Exhibit A-1 or A-2 hereto.
(e) Each Lender may sell participations in or to all or a
portion of its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment or Commitments, the Advances
owing to it and the Note or Notes held by it); PROVIDED, HOWEVER, that (i) such
Lender's obligations under this Agreement (including, without limitation, its
Commitment or Commitments) shall remain unchanged, (ii) such Lender shall remain
solely responsible to the other parties hereto for the performance of such
obligations, (iii) such Lender shall remain the holder of any such Note or Notes
for all purposes of this Agreement and (iv) the Borrower, the Agent and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender's rights and obligations under this Agreement.
(f) Any Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
8.07, disclose to the assignee or participant or proposed assignee or
participant any information relating to the Borrower furnished to such Lender by
or on behalf of the Borrower; PROVIDED, HOWEVER, that, prior to any such
disclosure, the assignee or participant or proposed assignee or participant
shall agree to preserve the confidentiality of any Confidential Information
received by it from such Lender.
(g) Notwithstanding any other provision set forth in this
Agreement, any Lender may at any time create a security interest in all or any
portion of its rights under this Agreement (including, without limitation, the
Advances owing to it and the Note or Notes held by it) in favor of
82
77
any Federal Reserve Bank in accordance with Regulation A of the Board of
Governors of the Federal Reserve System.
(h) The Borrower and each Lender agree that, at the request of
the Agent, the Borrower or such Lender will reexecute this Agreement to reflect
the assignments that have been effected in accordance with this Section 8.07.
SECTION 8.08. CONFIDENTIALITY. Neither the Agent nor any
Lender shall disclose any Confidential Information to any Person without the
consent of the Borrower, other than (a) to the Agent's or such Lender's
Affiliates and their officers, directors, employees, agents and advisors and to
actual or prospective Eligible Assignees and participants, and then only on a
confidential basis, (b) as required by any law, rule, regulation or judicial
process and (c) as requested or required by any state, federal or foreign
authority or examiner regulating securities, banks or banking.
SECTION 8.09. GOVERNING LAW. This Agreement and the Notes
shall be governed by, and construed in accordance with, the laws of the State of
New York.
SECTION 8.10. NO LIABILITY OF THE ISSUING BANKS OR THE
EXISTING ISSUING BANKS. The Borrower assumes all risks of the acts or omissions
of any beneficiary or transferee of any Letter of Credit with respect to its use
of such Letter of Credit. The Issuing Bank, the Existing issuing Banks and all
of their officers or directors shall not be liable or responsible for:
(a) the use that may be made of any Letter of Credit or any
acts or omissions of any beneficiary or transferee in connection
therewith;
(b) the validity, sufficiency or genuineness of documents, or
of any endorsement thereon, even if such documents should prove to be
in any or all respects invalid, insufficient, fraudulent or forged;
(c) payment by the Issuing Bank or any Existing Issuing Bank
against presentation of documents that do not comply with the terms
of a Letter of Credit, including, without limitation, failure of any
documents to bear any reference or adequate reference to such Letter
of Credit; or
(d) any other circumstances whatsoever in making or failing to
make payment under any Letter of Credit;
PROVIDED, HOWEVER, that the Borrower shall have a claim against the Issuing Bank
or any Existing Issuing Bank, and the Issuing Bank or such Existing Issuing Bank
shall be liable to the Borrower, to the extent of any direct, but not
consequential, damages suffered by the Borrower that the Borrower proves were
caused by (i) the Issuing Bank's or such Existing Issuing Bank's willful
misconduct or gross negligence in determining whether documents presented under
any Letter of Credit comply with the terms of such Letter of Credit or (ii) the
Issuing Bank's or Such Existing Issuing Bank's willful failure to make lawful
payment under a Letter of Credit after the presentation to it of a draft and
certificates strictly complying with the terms and conditions of such Letter of
Credit. In furtherance and not in limitation of the foregoing, the Issuing Bank
may and the Existing Issuing Banks may accept documents that appear on their
face to be in order, without responsibility for further investigation,
regardless of any notice or information to the contrary.
83
78
SECTION 8.11. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Agreement by telecopier shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 8.12. WAIVER OF JURY TRIAL. Each of the Borrower, the
Agents, the Issuing Bank, the Swing Line Bank and the Lenders hereby irrevocably
waives all right to trial by jury in any action, proceeding or counterclaim
(whether based on contract, tort or otherwise) arising out of or relating to any
of the Loan Documents, the Advances or the actions of the Agent or any Lender in
the negotiation, administration, performance or enforcement thereof.
84
79
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective officers thereunto duly authorized,
as of the date first above written.
SIGNATURE BRANDS, INC.
By /s/ Xxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice President, Treasurer
and Chief Financial Officer
BANQUE NATIONALE DE PARIS,
as Agent, Syndication Agent, Issuing Bank,
Swing Line Bank and Lender
By /s/ Xxxxxxx X. Xxxxxxx
------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President
By /s/ Xxxxxxx Xxxxxxxxx
-----------------------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Senior Vice President Structured
Finance Group
NBD BANK, as Documentation
Agent and Lender
By /s/ Xxxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: First Vice President
85
80
XXXXXXXXX XXXXXXXX LIFE INSURANCE
COMPANY OF AMERICA
By /s/ Xxxx X. Xxxxxx
-----------------------------------------
Name: Xxxx X. Xxxxxx
Title: Senior Vice President
NATEXIS BANQUE BFCE
By /s/ Xxxxx X. Xxxxxx, Xx.
-----------------------------------------
Name: Xxxxx X. Xxxxxx, Xx.
Title: Vice President
By /s/ Xxxxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President - Group Manager
CREDIT AGRICOLE INDOSUEZ
By /s/ Xxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxx
Title: First Vice President
By /s/ Xxxxxxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxxxxxx X. Xxxxxx
Title: First Vice President
PRIME INCOME TRUST
By /s/ Xxxxxx Xxxxxxx
-----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Senior Vice President - Portfolio
Manager
FIRST SOURCE FINANCIAL LLP
By FIRST SOURCE FINANCIAL, INC.,
its Agent/Manager
By /s/ Xxxxx X. Xxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
LASALLE NATIONAL BANK
By /s/ Xxxx Xxxxxxxx
-----------------------------------------
Name: Xxxx Xxxxxxxx
Title: First Vice President
86
81
KEY CORPORATE CAPITAL INC.
By /s/ Xxx Xxxxxx
-----------------------------------------
Name: Xxx Xxxxxx
Title: Senior Vice President
THE FIRST NATIONAL BANK OF
CHICAGO
By /s/ Xxxxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: First Vice President
U.S. BANK NATIONAL ASSOCIATION
By /s/ Xxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
XXX XXXXXX AMERICAN CAPITAL
PRIME RATE INCOME TRUST
By /s/ Xxxxxxxx X. Xxxx
-----------------------------------------
Name: Xxxxxxxx X. Xxxx
Title: Vice President
87
SCHEDULE I TO THE
CREDIT AGREEMENT
----------------
SCHEDULE I
COMMITMENTS AND APPLICABLE LENDING OFFICES
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Banque $7,970,533.34 $496,250 $2,750,000 $18,000,000 $3,000,000 Credit Matters Credit Matters
Nationale de -------------- --------------
Paris 000 Xxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Tel: (000)000-0000 Tel: (000) 000-0000
Fax: (000)000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxxx Xxxxxxx Attn: Xxxxxxxxx Xxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
000 Xxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Tel: (000)000-0000 Tel: (000) 000-0000
Fax: (000)000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxxx Attn: Xxxxxxxx Xxxxxxxx
Xxxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
88
2
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
000 Xxxx Xxxxxx 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
ABA No.: 000000000 ABA No.: 000000000
Account No.: Account No.: 75042070103
75042070103 Ref: Signature Brands
Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
The First $7,080,900 $6,600,000 Credit Control Credit Control
National Bank -------------- --------------
of Chicago Xxxxxxxx Xxxxx Xxxxxxxx Xxxxx
000 Xxxxxxxx Xxxxxx 000 Xxxxxxxx Xxxxxx
0xx XxxxxXxxxx 0xx XxxxxXxxxx
Detroit MI 48226 Xxxxxxx XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
One First National Plaza One First National Plaza
Suite 0173 Suite 0173
Chicago, IL 60670-0173 Xxxxxxx, XX 00000-0000
Tel: (000)000-0000 Tel: (000) 000-0000
Fax: (000)000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxxx Xxxxxx Attn: Xxxxxxxxx Xxxxxx
------------------------------------------------------------------------------------------------------------------------------------
89
3
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
One First National Plaza One First National Plaza
Suite 0173 Suite 0173
Chicago, IL 60670- Xxxxxxx, XX 00000-0000
0173 ABA No.: 000000000
ABA No.: 000000000 Account No.: 00000000
Account No.: 00000000 Ref: Signature Brands
Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Prime Income 4,720,600 Credit Credit
Trust ------- ------
Xxxxx Xxxxxxx Xxxxx Xxxxxxx
Two World Trade Two World Trade Center
Center 72nd Floor
72nd Floor New York, NY 10048
Xxx Xxxx, XX 00000 Tel: (000) 000-0000
Tel: (000)000-0000 Fax: (000) 000-0000
Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
April Chrysostomas April Chrysostomas
Tel: (000)000-0000 Tel: (000) 000-0000
Fax: (000)000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
90
4
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
Bank of New York Bank of New York
ABA# 000000000 ABA# 000000000
For: Prime Income For: Prime Income Trust
Trust A/D#: 003348
A/D#: 003348 GLA: 111612
GLA: 111612 Attn: MUTUAL FUNDS
Attn: MUTUAL RECON. DEPT.
FUNDS RECON.
DEPT.
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
LaSalle $4,720,600 $5,500,000 Credit Matters Credit Matters
National -------------- --------------
Bank 000 Xxxxx XxXxxxx 000 Xxxxx XxXxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxx Xxxxxxxx Attn: Xxxx Xxxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
000 Xxxxx XxXxxxx 000 Xxxxx XxXxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxxx Xxxxx Attn: Xxxxxxx Xxxxx
------------------------------------------------------------------------------------------------------------------------------------
91
5
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
000 Xxxxx XxXxxxx 000 Xxxxx XxXxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
ABA No.: 000000000 ABA No.: 000000000
Account No.: Account No.:
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Alexander $3,933,833.33 Credit Credit
Xxxxxxxx Life ------ ------
Insurance Xxxxxx Xxx Xxxxxx Xxx
Company of 000 Xxxxx Xxxxxx Xx. 000 Xxxxx Xxxxxx Xx.
Xxxxxxx Xxxxxxxxxx, XX 00000 Xxxxxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
Xxxxxxx Xxxxxxx Xxxxxxx Xxxxxxx
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
The Bank of New York The Bank of New York
ABA#: 000000000 ABA#: 000000000
Attn: P&I Department Attn: P&I Department
BNF: IOC 566 BNF: IOC 566
F/O: Alexander F/O: Alexander Xxxxxxxx
Xxxxxxxx Life Insurance Life Insurance Co.
Co. Ref: Signature Brands
Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
92
6
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
NBD Bank $5,216,850 $496,250 $8,250,000 Credit Matters Credit Matters
-------------- --------------
000 Xxxxxxxx Xxxxxx 611 Xxxxxxxx Avenue
2nd Floor South 2nd Floor South
Detroit, MI 48226 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxx Xxxxx Attn: Xxxxxxxx Xxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
000 Xxxxxxxx Xxxxxx 611 Xxxxxxxx Avenue
2nd Floor South 2nd Floor South
Detroit, MI 48226 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxxxx Xxxxx Attn: Xxxxxxxx Xxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
000 Xxxxxxxx Xxxxxx 611 Xxxxxxxx Avenue
0xx Xxxxx Xxxxx 0xx Xxxxx Xxxxx
Xxxxxxx, XX 00000 Xxxxxxx, XX 00000
ABA No.: 000000000 ABA No.: 000000000
Account No.: 212115 Account No.: 212115
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
93
7
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
Natexis $2,360,300 $1,833,333.33 Credit Credit
Banque-BFCE ------ ------
Xxxxx Xxxxxx, Jr. Xxxxx Xxxxxx, Jr.
000 Xxxxx Xxxxxx 000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
Xxxxx Xxxxxxx Xxxxx Xxxxxxx
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
Chase Manhattan Bank Chase Manhattan Bank
ABA#: 000000000 ABA#: 000000000
Favor: BFCE Favor: BFCE
A/C#: 000-0-00000 A/C#: 000-0-00000
Attn: Xxxxx Xxxxxxx Attn: Xxxxx Xxxxxxx
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
First Source $13,750,000 Credit Credit
Financial ------ ------
Xxxxxxx Xxxx Xxxxxxx Xxxx
0000 Xxxx Xxxx Xxxx 0000 Xxxx Xxxx Xxxx
0xx Xxxxx 0xx Xxxxx
Xxxxxxx Xxxxxxx, XX Xxxxxxx Xxxxxxx, XX
00000 60008
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
94
8
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Operations Operations
Xxxxxx Xxxxxx Xxxxxx Xxxxxx
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
LaSalle National Bank LaSalle National Bank
ABA#: 000-000-000 ABA#: 000-000-000
For: The Bank of New For: The Bank of New
York as Collateral Agent York as Collateral Agent
A/C#: 2358874 A/C#: 2358874
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Credit $4,720,600 $4,400,000 Credit Credit
Agricole ------ ------
Indosuez Xxxxxxx Xxxxxxxxxx Xxxxxxx Xxxxxxxxxx
00 X. Xxxxxx Xx. 55 X. Xxxxxx St.
Suite 4700 Suite 4700
Chicago, IL 60603 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
95
9
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
-----------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
Xxxxx Xxxxxx Xxxxx Xxxxxx
00 X. Xxxxxx Xx. 55 X. Xxxxxx St.
Suite 4700 Suite 4700
Chicago, IL 60603 Xxxxxxx, XX 00000
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
Citibank Citibank
ABA#: 012000089 ABA#: 012000089
For: Credit Agricole For: Credit Agricole
Indosuez Indosuez
Chicago Branch Chicago Branch
A/C#: 36023853 A/C#: 36023853
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
Key Corporate $4,720,600 $8,250,000 Credit Matters Credit Matters
Capital Inc. -------------- --------------
000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000- Xxxxxxxxx, XX 00000-0000
1306 Tel: (000) 000-0000
Tel: (000) 000-0000 Fax: (000) 000-0000
Fax: (000) 000-0000 Attn: Xxx Xxxxxx
Attn: Xxx Xxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
96
10
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
-----------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000- Xxxxxxxxx, XX 00000-0000
1306 Tel: (000) 000-0000
Tel: (000) 000-0000 Fax: (000) 000-0000
Fax: (000) 000-0000 Attn: Xxxxx Xxxxxx
Attn: Xxxxx Xxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
000 Xxxxxx Xxxxxx 000 Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000- Xxxxxxxxx, XX 00000-0000
1306 ABA No.: 000000000
ABA No.: 000000000 Account No.:
Account No.: Ref: Signature Brands
Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
U.S. National $4,720,600 $3,666,666.67 Credit Matters Credit Matters
Bank -------------- --------------
Association First Bank Place First Bank Place
000 Xxxxxx Xxx. South 000 Xxxxxx Xxx. Xxxxx
Xxxxxxxxxxx, XX Xxxxxxxxxxx, XX
00000-0000 55402-4302
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxx Kopalow Attn: Xxxxx Kopalow
------------------------------------------------------------------------------------------------------------------------------------
97
11
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
-----------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
000 X.X. Xxx Xxxxxx 000 X.X. Xxx Xxxxxx
Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
Tel: (000)000-0000 Tel: (000) 000-0000
Fax: (000)000-0000 Fax: (000) 000-0000
Attn: Xxxxx Xxxxxxx Attn: Xxxxx Xxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
000 X.X. Xxxxx Xxxxxx, 111 S.W. Fifth Avenue,
T-29 T-29
Xxxxxxxx, XX 00000 Xxxxxxxx, XX 00000
ABA No.: 000000000 ABA No.: 000000000
Account No.: Account No.:
Ref: Signature Brands Ref: Signature Brands
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Xxx Xxxxxx $9,834,583.33 $0 $0 Credit Matters Credit Matters
Xxxxxxx Prime -------------- --------------
Rate Income Xxx Xxxxxxxx Xxxxx Xxx Xxxxxxxx Xxxxx
Trust Oakbrook Terrace, IL Xxxxxxxx Xxxxxxx, XX
00000 60181
Tel: (000) 000-0000 Tel: (000) 000-0000
Fax: (000) 000-0000 Fax: (000) 000-0000
Attn: Xxxxxxx Xxxxxxx Attn: Xxxxxxx Xxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
98
12
====================================================================================================================================
Name of Bank Term Commitment Increased Revolving Letter of Swing Line Domestic Lending Eurodollar Lending Office
------------ Term Credit Credit Commitment Office
Commitment Commitment Commitment
-----------------------------------------------------------------------------------------------------------------------------------
Operations Operations
---------- ----------
One Parkview Plaza State Street & Trust
Oakbrook Terrace, IL Corp. Trust Dept.
60181 X.X. Xxx 000
Tel: (000) 000 0000 Xxxxxx,XX 00000
Fax: (708) 684- Tel: (000) 000-0000
6740/41 Fax: (000) 000-0000/67
Attn: Xxxxx Xxxx Attn: Xxxx Xxxxxxxxx
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Payments Payments
-------- --------
One Parkview Plaza One Parkview Plaza
Oakbrook Terrace, IL Xxxxxxxx Xxxxxxx, XX
00000 60181
ABA No.: 000000000 ABA No.: 000000000
Account No.: 00000000 Account No.: 00000000
Ref: Signature Brands Ref: Signature Brands
====================================================================================================================================
