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CREDIT AGREEMENT
among
GREAT LAKES ACQUISITION CORP.,
GREAT LAKES CARBON CORPORATION,
VARIOUS BANKS,
BANK OF AMERICA NT&SA, as CO-AGENT,
DLJ CAPITAL FUNDING, INC., as DOCUMENTATION AGENT
and
BANKERS TRUST COMPANY,
as SYNDICATION AGENT
and
as ADMINISTRATIVE AGENT
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Dated as of May 22, 1998
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TABLE OF CONTENTS
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1.01 The Commitments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
1.02 Minimum Amount of Each Borrowing. . . . . . . . . . . . . . . . . . . . .4
1.03 Notice of Borrowing . . . . . . . . . . . . . . . . . . . . . . . . . . .4
1.04 Disbursement of Funds . . . . . . . . . . . . . . . . . . . . . . . . . .5
1.05 Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5
1.06 Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
1.07 Pro Rata Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . .7
1.08 Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
1.09 Interest Periods. . . . . . . . . . . . . . . . . . . . . . . . . . . . .8
1.10 Increased Costs, Illegality, etc. . . . . . . . . . . . . . . . . . . . 10
1.11 Compensation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.12 Change of Lending Office. . . . . . . . . . . . . . . . . . . . . . . . 12
1.13 Replacement of Banks. . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2. Letters of Credit. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.01 Letters of Credit . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.02 Letter of Credit Requests . . . . . . . . . . . . . . . . . . . . . . . 15
2.03 Letter of Credit Participations . . . . . . . . . . . . . . . . . . . . 15
2.04 Agreement to Repay Letter of Credit Drawings. . . . . . . . . . . . . . 17
2.05 Increased Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 3. Commitment Commission; Fees; Reductions of Commitment. . . . . . . . . 19
3.01 Fees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
3.02 Voluntary Termination and Reduction of Commitments. . . . . . . . . . . 20
3.03 Mandatory Reduction of Commitments. . . . . . . . . . . . . . . . . . . 20
SECTION 4. Prepayments; Payments; Taxes . . . . . . . . . . . . . . . . . . . . . 21
4.01 Voluntary Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.02 Mandatory Repayments and Commitment Reductions. . . . . . . . . . . . . 22
4.03 Method and Place of Payment . . . . . . . . . . . . . . . . . . . . . . 31
4.04 Net Payments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 5. Conditions Precedent to Credit Events on the Initial Borrowing
Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
5.01 Execution of Agreement; Notes . . . . . . . . . . . . . . . . . . . . . 33
5.02 Fees, etc.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
5.03 Opinions of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . 33
5.04 Corporate Documents; Proceedings; etc.. . . . . . . . . . . . . . . . . 34
5.05 Shareholders' Agreements; Management Agreements; Tax Sharing
Agreements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(i)
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5.06 Consummation of the Transaction . . . . . . . . . . . . . . . . . . . . 34
5.07 Pledge Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
5.08 Security Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . 37
5.09 Mortgages; Title Insurance; etc.. . . . . . . . . . . . . . . . . . . . 37
5.10 Adverse Change, etc.. . . . . . . . . . . . . . . . . . . . . . . . . . 38
5.11 Solvency Letter; Insurance. . . . . . . . . . . . . . . . . . . . . . . 38
5.12 Pro Forma Balance Sheet; Projections. . . . . . . . . . . . . . . . . . 39
SECTION 6. Conditions Precedent to All Credit Events. . . . . . . . . . . . . . . 39
6.01 No Default; Representations and Warranties. . . . . . . . . . . . . . . 39
6.02 Notice of Borrowing; Letter of Credit Request . . . . . . . . . . . . . 39
SECTION 7. Representations, Warranties and Agreements . . . . . . . . . . . . . . 40
7.01 Corporate Status. . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
7.02 Corporate Power and Authority . . . . . . . . . . . . . . . . . . . . . 40
7.03 No Violation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
7.04 Governmental Approvals. . . . . . . . . . . . . . . . . . . . . . . . . 41
7.05 Financial Statements; Financial Condition; Undisclosed
Liabilities; Projections; etc.. . . . . . . . . . . . . . . . . . . . 41
7.06 Litigation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
7.07 True and Complete Disclosure. . . . . . . . . . . . . . . . . . . . . . 42
7.08 Use of Proceeds; Margin Regulations . . . . . . . . . . . . . . . . . . 42
7.09 Tax Returns and Payments. . . . . . . . . . . . . . . . . . . . . . . . 43
7.10 Compliance with ERISA . . . . . . . . . . . . . . . . . . . . . . . . . 43
7.11 The Security Documents. . . . . . . . . . . . . . . . . . . . . . . . . 44
7.12 Representations and Warranties in Documents . . . . . . . . . . . . . . 44
7.13 Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
7.14 Capitalization. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.15 Subsidiaries. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.16 Compliance with Statutes, etc.. . . . . . . . . . . . . . . . . . . . . 45
7.17 Investment Company Act. . . . . . . . . . . . . . . . . . . . . . . . . 45
7.18 Public Utility Holding Company Act. . . . . . . . . . . . . . . . . . . 45
7.19 Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.20 Patents, Licenses, Franchises and Formulas. . . . . . . . . . . . . . . 46
7.21 Transaction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
7.22 Special Purpose Corporation . . . . . . . . . . . . . . . . . . . . . . 46
7.23 Senior Subordinated Notes and Holdings Debentures . . . . . . . . . . . 46
SECTION 8. Affirmative Covenants. . . . . . . . . . . . . . . . . . . . . . . . . 47
8.01 Information Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 47
8.02 Books, Records and Inspections. . . . . . . . . . . . . . . . . . . . . 49
8.03 Maintenance of Property; Insurance. . . . . . . . . . . . . . . . . . . 49
8.04 Corporate Franchises. . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.05 Compliance with Statutes, etc.. . . . . . . . . . . . . . . . . . . . . 50
(ii)
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8.06 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.07 End of Fiscal Years; Fiscal Quarters. . . . . . . . . . . . . . . . . . 51
8.08 Performance of Obligations. . . . . . . . . . . . . . . . . . . . . . . 51
8.09 Payment of Taxes. . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
8.10 Maintenance of Separateness . . . . . . . . . . . . . . . . . . . . . . 52
8.11 Additional Security; Further Assurances . . . . . . . . . . . . . . . . 52
SECTION 9. Negative Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . 54
9.01 Liens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
9.02 Consolidation, Merger, Purchase or Sale of Assets, etc. . . . . . . . . 57
9.03 Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
9.04 Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
9.05 Advances, Investments and Loans . . . . . . . . . . . . . . . . . . . . 61
9.06 Transactions with Affiliates. . . . . . . . . . . . . . . . . . . . . . 63
9.07 Capital Expenditures. . . . . . . . . . . . . . . . . . . . . . . . . . 63
9.08 Adjusted Leverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . 65
9.09 Interest Coverage Ratio . . . . . . . . . . . . . . . . . . . . . . . . 66
9.10 Limitation on Modifications of Certificate of Incorporation,
By-Laws and Certain Other Agreements; Limitations of Prepayments
and Modifications of Indebtedness; etc. . . . . . . . . . . . . . . . 67
9.11 Limitation on Certain Restrictions on Subsidiaries. . . . . . . . . . . 67
9.12 Limitation on Issuance of Capital Stock . . . . . . . . . . . . . . . . 67
9.13 Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
9.14 Limitation on Creation of Subsidiaries. . . . . . . . . . . . . . . . . 68
9.15 No Other Designated Senior Indebtedness . . . . . . . . . . . . . . . . 68
SECTION 10. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . 68
10.01 Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
10.02 Representations, etc.. . . . . . . . . . . . . . . . . . . . . . . . . 68
10.03 Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
10.04 Default Under Other Agreements . . . . . . . . . . . . . . . . . . . . 69
10.05 Bankruptcy, etc. . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
10.06 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
10.07 Security Documents . . . . . . . . . . . . . . . . . . . . . . . . . . 70
10.08 Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
10.09 Judgments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
10.10 Change of Control. . . . . . . . . . . . . . . . . . . . . . . . . . . 70
SECTION 11. Definitions and Accounting Terms. . . . . . . . . . . . . . . . . . . 71
11.01 Defined Terms. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
SECTION 12. The Administrative Agent. . . . . . . . . . . . . . . . . . . . . . . 96
12.01 Appointment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
12.02 Nature of Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
(iii)
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12.03 Lack of Reliance on the Administrative Agent . . . . . . . . . . . . . 97
12.04 Certain Rights of the Administrative Agent . . . . . . . . . . . . . . 97
12.05 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
12.06 Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
12.07 The Administrative Agent in Its Individual Capacity. . . . . . . . . . 98
12.08 Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
12.09 Resignation by the Administrative Agent. . . . . . . . . . . . . . . . 98
SECTION 13. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
13.01 Payment of Expenses, etc.. . . . . . . . . . . . . . . . . . . . . . . 99
13.02 Right of Setoff; Collateral Matters. . . . . . . . . . . . . . . . . .100
13.03 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .101
13.04 Benefit of Agreement . . . . . . . . . . . . . . . . . . . . . . . . .101
13.05 No Waiver; Remedies Cumulative . . . . . . . . . . . . . . . . . . . .103
13.06 Payments Pro Rata. . . . . . . . . . . . . . . . . . . . . . . . . . .103
13.07 Calculations; Computations . . . . . . . . . . . . . . . . . . . . . .104
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL. . . . . . . . . . . . . . . . . . . . . . . . .104
13.09 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
13.10 Effectiveness. . . . . . . . . . . . . . . . . . . . . . . . . . . . .105
13.11 Headings Descriptive . . . . . . . . . . . . . . . . . . . . . . . . .105
13.12 Amendment or Waiver; etc.. . . . . . . . . . . . . . . . . . . . . . .105
13.13 Survival . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106
13.14 Domicile of Loans. . . . . . . . . . . . . . . . . . . . . . . . . . .107
13.15 Limitation on Additional Amounts, etc. . . . . . . . . . . . . . . . .107
13.16 Confidentiality. . . . . . . . . . . . . . . . . . . . . . . . . . . .107
13.17 Registry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108
SECTION 14. Holdings Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . .108
14.01 The Guaranty . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108
14.02 Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .109
14.03 Nature of Liability. . . . . . . . . . . . . . . . . . . . . . . . . .109
14.04 Independent Obligation . . . . . . . . . . . . . . . . . . . . . . . .109
14.05 Authorization. . . . . . . . . . . . . . . . . . . . . . . . . . . . .109
14.06 Reliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .110
14.07 Subordination. . . . . . . . . . . . . . . . . . . . . . . . . . . . .110
14.08 Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .111
14.09 Nature of Liability. . . . . . . . . . . . . . . . . . . . . . . . . .112
(iv)
SCHEDULE I Commitments
SCHEDULE II Tax Matters
SCHEDULE III Real Property
SCHEDULE IV Insurance
SCHEDULE V Existing Liens
SCHEDULE VI Existing Indebtedness
EXHIBIT A Notice of Borrowing
EXHIBIT B-1 A Term Note
EXHIBIT B-2 B Term Note
EXHIBIT B-3 C Term Note
EXHIBIT B-4 Revolving Note
EXHIBIT B-5 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4.04(b)(ii) Certificate
EXHIBIT E Opinion of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
Special Counsel to the Credit Parties
EXHIBIT F Officers' Certificate
EXHIBIT G Pledge Agreement
EXHIBIT H Security Agreement
EXHIBIT I Mortgage
EXHIBIT J Subsidiary Guaranty
EXHIBIT K Assignment and Assumption Agreement
(v)
CREDIT AGREEMENT, dated as of May 22, 1998, among GREAT LAKES
ACQUISITION CORP., a Delaware corporation ("Holdings"), GREAT LAKES CARBON
CORPORATION, a Delaware corporation (the "Borrower"), the Banks party hereto
from time to time, BANK OF AMERICA NT&SA, as Co-Agent, DLJ CAPITAL FUNDING,
INC., as Documentation Agent, and BANKERS TRUST COMPANY, as Syndication Agent
and as Administrative Agent (all capitalized terms used herein and defined in
Section 11 are used herein as therein defined).
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions herein set
forth, the Banks are willing to make available to the Borrower the respective
credit facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 THE COMMITMENTS. (a) Subject to and upon the terms and
conditions set forth herein, each Bank with an A Term Loan Commitment severally
agrees to make, on the Initial Borrowing Date, a term loan (each, an "A Term
Loan" and collectively, the "A Term Loans") to the Borrower, which A Term Loans
(i) shall, at the option of the Borrower, be made and initially maintained as
Base Rate Loans or Eurodollar Loans (subject to the option to convert such A
Term Loans pursuant to Section 1.06) and (ii) shall be made by each Bank in that
aggregate principal amount as is equal to the A Term Loan Commitment of such
Bank on such date. Once repaid, A Term Loans borrowed hereunder may not be
reborrowed.
(b) Subject to and upon the terms and conditions set forth herein,
each Bank with a B Term Loan Commitment severally agrees to make, on the Initial
Borrowing Date, a term loan (each, a "B Term Loan" and collectively, the "B Term
Loans") to the Borrower, which B Term Loans (i) shall, at the option of the
Borrower, be made and initially maintained as Base Rate Loans or Eurodollar
Loans (subject to the option to convert such B Term Loans pursuant to Section
1.06) and (ii) shall be made by each Bank in that aggregate principal amount as
is equal to the B Term Loan Commitment of such Bank on such date. Once repaid,
B Term Loans incurred hereunder may not be reborrowed.
(c) Subject to and upon the terms and conditions set forth herein,
each Bank with a C Term Loan Commitment severally agrees to make, on the Initial
Borrowing Date, a term loan (each a "C Term Loan" and collectively, the "C Term
Loans" and, together with the A Term Loans and the B Term Loans, the "Term
Loans") to the Borrower, which C Term Loans (i) shall, at the option of the
Borrower, be made and initially maintained as Base Rate Loans or Eurodollar
Loans (subject to the option to convert such C Term Loans pursuant to Section
1.06) and (ii) shall be made by each Bank in that aggregate principal amount as
is equal to the C Term Loan Commitment of such Bank on such date. Once repaid, C
Term Loans incurred hereunder may not be reborrowed.
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(d) Subject to and upon the terms and conditions set forth herein,
each Bank with a Revolving Loan Commitment severally agrees, at any time and
from time to time on and after the Initial Borrowing Date and prior to the
Revolving Loan Maturity Date, to make a revolving loan or revolving loans (each,
a "Revolving Loan" and collectively, the "Revolving Loans") to the Borrower,
which Revolving Loans (i) shall, at the option of the Borrower, be Base Rate
Loans or Eurodollar Loans, PROVIDED, that except as otherwise specifically
provided in Section 1.10(b), all Revolving Loans comprising the same Borrowing
shall at all times be of the same Type, (ii) may be repaid and reborrowed in
accordance with the provisions hereof, (iii) shall not exceed for any Bank at
any time outstanding that aggregate principal amount which when added to the
product of (x) such Bank's Adjusted Percentage and (y) the sum of (I) the
aggregate amount of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously with the
incurrence of, the respective incurrence of Revolving Loans) at such time and
(II) the aggregate principal amount of all Swingline Loans (exclusive of
Swingline Loans which are repaid with the proceeds of, and simultaneously with
the incurrence of, Revolving Loans) then outstanding, equals the Revolving Loan
Commitment of such Bank at such time and (iv) shall not exceed for all Banks at
any time outstanding the sum of (I) the aggregate principal amount which, when
added to the amount of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously with the
incurrence of, Revolving Loans) at such time and (II) the aggregate principal
amount of all Swingline Loans (exclusive of Swingline Loans which are repaid
with the proceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) then outstanding, equals the Total Revolving Loan
Commitment at such time.
(e) Subject to and upon the terms and conditions set forth herein,
the Swingline Bank agrees to make at any time and from time to time after the
Initial Borrowing Date and prior to the Swingline Expiry Date, a loan or loans
(each a "Swingline Loan," and collectively, the "Swingline Loans") to the
Borrower, which Swingline Loans:
(i) shall be made and maintained as Base Rate Loans;
(ii) may be repaid and reborrowed in accordance with the provisions
hereof;
(iii) shall not exceed in aggregate principal amount at any time
outstanding, when combined with (x) the aggregate principal amount of all
Revolving Loans then outstanding and (y) the amount of all Letter of Credit
Outstandings at such time, an amount equal to the Adjusted Total Revolving
Loan Commitment at such time (after giving effect to any reductions to the
Total Revolving Loan Commitment on such date); and
(iv) shall not exceed in aggregate principal amount at any time
outstanding the Maximum Swingline Amount.
The Swingline Bank shall not be obligated to make any Swingline Loans at a time
when a Bank Default exists unless the Swingline Bank has entered into
arrangements satisfactory to it to eliminate the Swingline Bank's risk with
respect to the Bank which is subject of such Bank Default, including by cash
collateralizing such Bank's Percentage of the outstanding Swingline Loans.
Notwithstanding anything to the contrary contained in this Section 1.01(e), the
Swingline
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Bank shall not make any Swingline Loan after receiving a written notice from the
Borrower or the Required Banks stating that a Default or an Event of Default
exists and is continuing until such time as the Swingline Bank shall have
received written notice of (i) rescission of such notice from the party or
parties originally delivering such notice, (ii) the waiver of such Default or
Event of Default or (iii) the Administrative Agent in good faith believes that
such Default or Event of Default has ceased to exist.
(f) On any Business Day, the Swingline Bank may, in its sole
discretion, give notice to the Banks with Revolving Loan Commitments that its
outstanding Swingline Loans shall be funded with a Borrowing of Revolving
Loans (provided that such notice shall be deemed to have been automatically
given upon the occurrence of a Default or an Event of Default under Section
10.05 or upon the exercise of any of the remedies provided in the last
paragraph of Section 10), in which case a Borrowing of Revolving Loans
constituting Base Rate Loans (each such Borrowing, a "Mandatory Borrowing")
shall be made on the immediately succeeding Business Day from all Banks with
a Revolving Loan Commitment (without giving effect to any termination and/or
reductions thereto pursuant to the last paragraph of Section 10) pro rata on
the basis of their respective Adjusted Percentages (determined before giving
effect to any termination of the Revolving Loan Commitments pursuant to the
last paragraph of Section 10) and the proceeds thereof shall be applied
directly to the Swingline Bank to repay the Swingline Bank for such
outstanding Swingline Loans. Each such Bank hereby irrevocably agrees to
make Revolving Loans upon one Business Day's notice pursuant to each
Mandatory Borrowing in the amount and in the manner specified in the
preceding sentence and on the date specified in writing by the Swingline Bank
(i) notwithstanding that the amount of the Mandatory Borrowing may not comply
with the minimum amount for Borrowings otherwise required hereunder, (ii)
whether any conditions specified in Section 5 or 6 are then satisfied, (iii)
whether a Default or an Event of Default then exists, (iv) notwithstanding
the date of such Mandatory Borrowing and (v) notwithstanding the amount of
the Total Revolving Loan Commitment at such time. In the event that any
Mandatory Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect to the
Borrower), then each such Bank with a Revolving Loan Commitment hereby agrees
that it shall forthwith purchase (as of the date the Mandatory Borrowing
would otherwise have occurred, but adjusted for any payments received from
the Borrower on or after such date and prior to such purchase) from the
Swingline Bank such participations in the outstanding Swingline Loans as
shall be necessary to cause such Banks to share in such Swingline Loans
ratably based upon their respective Adjusted Percentages (determined before
giving effect to any termination of the Revolving Loan Commitments pursuant
to the last paragraph of Section 10); provided, that (x) all interest payable
on the Swingline Loans shall be for the account of the Swingline Bank until
the date as of which the respective participation is required to be purchased
and, to the extent attributable to the purchased participation shall be
payable to the participant from and after such date and (y) at the time any
purchase of participations pursuant to this sentence is actually made, the
purchasing Bank shall be required to pay the Swingline Bank interest on the
principal amount of participation purchased for each day from and including
the day upon which the Mandatory Borrowing would otherwise have occurred to
but excluding the date of payment for such participation, at the rate
otherwise applicable to Revolving Loans maintained as Base Rate Loans
hereunder for each day thereafter.
-3-
1.02 MINIMUM AMOUNT OF EACH BORROWING. The aggregate principal
amount of each Borrowing of Term Loans shall not be less than $2,000,000 and, if
greater, shall be in an integral multiple of $500,000. The aggregate principal
amount of each Borrowing of Revolving Loans shall be not less than $1,000,000
($500,000 in the case of Base Rate Loans) and, if greater, shall be in an
integral multiple of $250,000 ($100,000 in the case of Base Rate Loans) or, if
less, the then remaining Total Revolving Loan Commitment provided that Mandatory
Borrowings shall be in the amounts required by Section 1.01(f). The aggregate
principal amount of each Borrowing of Swingline Loans shall not be less than
$50,000. More than one Borrowing may occur on the same date, but at no time
shall there be outstanding more than ten Borrowings of Eurodollar Loans.
1.03 NOTICE OF BORROWING. (a) Whenever the Borrower desires to make
a Borrowing hereunder (excluding Borrowings of Swingline Loans and Mandatory
Borrowings), it shall give the Administrative Agent at its Notice Office at
least one Business Day's prior written (or telephonic promptly confirmed in
writing) notice of each Base Rate Loan and at least three Business Days' prior
written (or telephonic promptly confirmed in writing) notice of each Eurodollar
Loan to be made hereunder, PROVIDED that any such notice shall be deemed to have
been given on a certain day only if given before 11:00 A.M. (New York time) in
the case of Eurodollar Loans, or 12:00 Noon (New York time) in the case of a
Borrowing of Base Rate Loans on such day. Each such written notice or written
confirmation of telephonic notice (each a "Notice of Borrowing") shall be given
by the Borrower in the form of Exhibit A, appropriately completed to specify the
aggregate principal amount of the Loans to be made pursuant to such Borrowing,
the date of such Borrowing (which shall be a Business Day), whether the Loans
being made pursuant to such Borrowing shall constitute A Term Loans, B Term
Loans, C Term Loans or Revolving Loans and whether the Loans being made pursuant
to such Borrowing are to be initially maintained as Base Rate Loans or
Eurodollar Loans and, if Eurodollar Loans, the initial Interest Period to be
applicable thereto. The Administrative Agent shall promptly give each Bank
which is required to make Loans of the Tranche specified in the respective
Notice of Borrowing, notice of such proposed Borrowing, of such Bank's
proportionate share thereof and of the other matters required by the immediately
preceding sentence to be specified in the Notice of Borrowing.
(b) (i) Whenever the Borrower desires to make a Borrowing of
Swingline Loans hereunder, it shall give the Swingline Bank, not later than 1:00
p.m. (New York time) on the date that a Swingline Loan is to be made, written
notice (or telephonic notice confirmed in writing) of each Swingline Loan to be
made hereunder. Each such notice shall specify in each case (a) the date of
Borrowing (which shall be a Business Day) and (b) the aggregate principal amount
of Swingline Loans to be made pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice specified in
Section 1.01(f), with the Borrower irrevocably agreeing, by its incurrence of
any Swingline Loan, to the making of the Mandatory Borrowings as set forth in
Section 1.01(f).
(c) Without in any way limiting the obligation of the Borrower to
confirm in writing any telephonic notice of any Borrowing of Loans, the
Administrative Agent or the Swingline Bank, as the case may be, may act without
liability upon the basis of telephonic notice
-4-
of such Borrowing, believed by the Administrative Agent or the Swingline Bank,
as the case may be, in good faith to be from an Authorized Officer of the
Borrower prior to receipt of written confirmation. In each such case, the
Borrower hereby waives the right to dispute the Administrative Agent's and the
Swingline Bank's record of the terms of such telephonic notice of such Borrowing
of Loans.
1.04 DISBURSEMENT OF FUNDS. Except as otherwise specifically
provided in the second succeeding sentence, no later than 12:00 Noon (New York
time) on the date specified in each Notice of Borrowing (or (x) in the case of
Swingline Loans, no later than the close of business on the date specified
pursuant to Section 1.03(b)(i) or (y) in case of Mandatory Borrowings, not later
than 12:00 Noon (New York time) on the date specified in Section 1.01(f)), each
Bank with a Commitment of the respective Tranche will make available its pro
rata portion of each such Borrowing requested to be made on such date (or in the
case of Swingline Loans, the Swingline Bank shall make available the full amount
thereof). All such amounts shall be made available in Dollars and in
immediately available funds at the Payment Office of the Administrative Agent,
and the Administrative Agent will make available to the Borrower at the Payment
Office the aggregate of the amounts so made available by the Banks (prior to
1:00 P.M. on such day, to the extent of funds actually received by the
Administrative Agent prior to 12:00 Noon on such day). Unless the
Administrative Agent shall have been notified by any Bank prior to the date of
Borrowing that such Bank does not intend to make available to the Administrative
Agent such Bank's portion of any Borrowing to be made on such date, the
Administrative Agent may assume that such Bank has made such amount available to
the Administrative Agent on such date of Borrowing and the Administrative Agent
may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such corresponding amount is not in fact made
available to the Administrative Agent by such Bank, the Administrative Agent
shall be entitled to recover such corresponding amount on demand from such Bank.
If such Bank does not pay such corresponding amount forthwith upon the
Administrative Agent's demand therefor, the Administrative Agent shall promptly
notify the Borrower and the Borrower shall immediately pay such corresponding
amount to the Administrative Agent. The Administrative Agent shall also be
entitled to recover on demand from such Bank or the Borrower, as the case may
be, interest on such corresponding amount in respect of each day from the date
such corresponding amount was made available by the Administrative Agent to the
Borrower until the date such corresponding amount is recovered by the
Administrative Agent, at a rate per annum equal to (i) if recovered from such
Bank, at the overnight Federal Funds Rate and (ii) if recovered from the
Borrower, the rate of interest applicable to the respective Borrowing, as
determined pursuant to Section 1.08. Nothing in this Section 1.04 shall be
deemed to relieve any Bank from its obligation to make Loans hereunder or to
prejudice any rights which the Borrower may have against any Bank as a result of
any failure by such Bank to make Loans hereunder.
1.05 NOTES. (a) The Borrower's obligation to pay the principal of,
and interest on, the Loans made by each Bank shall be evidenced (i) if A Term
Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-1 with blanks appropriately completed in
conformity herewith (each, an "A Term Note" and collectively, the "A Term
Notes"), (ii) if B Term Loans, by a promissory note duly executed and delivered
by the Borrower substantially in the form of Exhibit B-2 with blanks
appropriately completed in conformity herewith (each, a "B Term Note" and
collectively, the "B Term Notes"), (iii) if C
-5-
Term Loans, by a promissory note duly executed and delivered by the Borrower
substantially in the form of Exhibit B-3 with blanks appropriately completed in
conformity herewith (each a "C Term Note" and collectively, the "C Term Notes"
and, together with the A Term Notes and the B Term Notes, the "Term Notes"),
(iv) if Revolving Loans, by a promissory note duly executed and delivered by the
Borrower substantially in the form of Exhibit B-4, with blanks appropriately
completed in conformity herewith (each, a "Revolving Note" and collectively, the
"Revolving Notes") and (v) if Swingline Loans, by a promissory note duly
executed and delivered by the Borrower substantially in the form of Exhibit B-5,
with blanks appropriately completed in conformity herewith (each, a "Swingline
Note" and collectively, the "Swingline Notes").
(b) The A Term Note issued to each Bank shall (i) be executed by the
Borrower, (ii) be payable to the order of such Bank and be dated the Initial
Borrowing Date, (iii) be in a stated principal amount equal to the respective A
Term Loan made by such Bank on the Initial Borrowing Date and be payable in the
principal amount of A Term Loans evidenced thereby, (iv) mature on the A Term
Maturity Date, (v) bear interest as provided in the appropriate clause of
Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case
may be, evidenced thereby, (vi) be subject to mandatory repayment as provided in
Section 4.02(A) and (vii) be entitled to the benefits of this Agreement and the
other Credit Documents.
(c) The B Term Note issued to each Bank shall (i) be executed by the
Borrower, (ii) be payable to the order of such Bank and be dated the Initial
Borrowing Date, (iii) be in a stated principal amount equal to the respective B
Term Loan made by such Bank on the Initial Borrowing Date and be payable in the
principal amount of B Term Loans evidenced thereby, (iv) mature on the B Term
Maturity Date, (v) bear interest as provided in the appropriate clause of
Section 1.08 in respect of the Base Rate Loans and Eurodollar Loans, as the case
may be, evidenced thereby, (vi) be subject to mandatory repayment as provided in
Section 4.02(A) and (vii) be entitled to the benefits of this Agreement and the
other Credit Documents.
(d) The C Term Note issued to each Bank shall (i) be executed by the
Borrower, (ii) be payable to the order of such Bank and be dated the Initial
Borrowing Date, (iii) be in a stated principal amount equal to the respective C
Term Loan made by such Bank on the Initial Borrowing Date and be payable in the
principal amount of C Term Loans evidenced thereby, (iv) mature on the C Term
Maturity Date, (v) bear interest as provided in the appropriate clause of
Section 1.08 in respect of Base Rate Loans and Eurodollar Loans, as the case may
be, evidenced thereby, (vi) be subject to mandatory repayment as provided in
Section 4.02(A) and (vii) be entitled to the benefits of this Agreement and the
other Credit Documents.
(e) The Revolving Note issued to each Bank shall (i) be executed by
the Borrower, (ii) be payable to the order of such Bank and be dated the Initial
Borrowing Date, (iii) be in a stated principal amount equal to the Revolving
Loan Commitment of such Bank and be payable in the principal amount of the
Revolving Loans evidenced thereby, (iv) mature on the Revolving Loan Maturity
Date, (v) bear interest as provided in the appropriate clause of Section 1.08 in
respect of the Base Rate Loans and Eurodollar Loans, as the case may be,
evidenced thereby, (vi) be subject to mandatory repayment as provided in Section
4.02(A) and (vii) be entitled to the benefits of this Agreement and the other
Credit Documents.
-6-
(f) The Swingline Note issued to the Swingline Bank shall (i) be
executed by the Borrower, (ii) be payable to the order of the Swingline Bank and
be dated the Initial Borrowing Date, (iii) be in a stated principal amount equal
to the Maximum Swingline Amount and be payable in the principal amount of the
outstanding Swingline Loans evidenced thereby from time to time, (iv) mature on
the Swingline Expiry Date, (v) bear interest as provided in the appropriate
clause of Section 1.08 in respect of the Base Rate Loans evidenced thereby, (vi)
be subject to voluntary repayment as provided in Section 4.01 and mandatory
repayment as provided in Section 4.02(A) and (vii) be entitled to the benefits
of this Agreement and the other Credit Documents.
(g) Each Bank will note on its internal records the amount of each
Loan made by it and each payment in respect thereof and will prior to any
transfer of any of its Notes endorse on the reverse side thereof the outstanding
principal amount of Loans evidenced thereby. Failure to make any such notation
or any error in any such notation or endorsement shall not affect the Borrower's
obligations in respect of such Loans.
1.06 CONVERSIONS. The Borrower shall have the option to convert on
any Business Day, all or a portion equal to at least (w) in the case of a
conversion of A Term Loans, $5,000,000 (and, if greater, in an integral multiple
of $500,000), (x) in the case of a conversion of B Term Loans, $5,000,000 (and,
if greater, in an integral multiple of $500,000), (y) in the case of a
conversion of C Term Loans, $5,000,000 (and, if greater, in an integral multiple
of $500,000) and (z) in the case of a conversion of Revolving Loans, $1,000,000
(and, if greater, in an integral multiple of $250,000), of the outstanding
principal amount of Loans made pursuant to one or more Borrowings (so long as of
the same Tranche) of one or more Types of Loans into a Borrowing (of the same
Tranche) of another Type of Loan (other than Swingline Loans which may not be
converted pursuant to this Section 1.06), PROVIDED that (i) Eurodollar Loans
converted into Base Rate Loans on any day other than the last day of an Interest
Period applicable to the Loans being converted shall be accompanied by costs set
forth in Section 1.11 and no partial conversion of Eurodollar Loans shall reduce
the outstanding principal amount of such Eurodollar Loans made pursuant to a
single Borrowing to less than (w) in the case of A Term Loans, $5,000,000, and
(x) in the case of B Term Loans, $5,000,000, (y) in the case of C Term Loans,
$5,000,000 and (z) in the case of Revolving Loans, $1,000,000, (ii) Base Rate
Loans may only be converted into Eurodollar Loans if no Default or Event of
Default is in existence on the date of the conversion and (iii) no conversion
pursuant to this Section 1.06 shall result in a greater number of Eurodollar
Loans than is permitted under Section 1.02. Each such conversion shall be
effected by the Borrower by giving the Administrative Agent at its Notice Office
prior to 12:00 Noon (New York time) at least three Business Days' (in the case
of a conversion of Base Rate Loans into Eurodollar Loans) and at least one
Business Day (in the case of a conversion of Eurodollar Loans into Base Rate
Loans) prior notice (each a "Notice of Conversion") specifying the Loans to be
so converted, the Borrowing or Borrowings pursuant to which such Loans were made
and, if to be converted into Eurodollar Loans, the Interest Period to be
initially applicable thereto. The Administrative Agent shall give each Bank
prompt notice of any such proposed conversion affecting any of its Loans.
1.07 PRO RATA BORROWINGS. All Borrowings of A Term Loans, B Term
Loans, C Term Loans and Revolving Loans under this Agreement shall be incurred
from the Banks PRO RATA on the basis of their A Term Loan Commitments, B Term
Loan Commitments, C Term Loan
-7-
Commitments or Revolving Loan Commitments, as the case may be; provided that all
Borrowings of Revolving Loans made pursuant to a Mandatory Borrowing shall be
incurred by the Borrower from the Banks with Revolving Loan Commitments pro rata
on the basis of their Adjusted Percentages. It is understood that no Bank shall
be responsible for any default by any other Bank of its obligation to make Loans
hereunder and that each Bank shall be obligated to make the Loans provided to be
made by it hereunder, regardless of the failure of any other Bank to make its
Loans hereunder.
1.08 INTEREST. (a) The Borrower agrees to pay interest in respect
of the unpaid principal amount of each Base Rate Loan from the date the proceeds
thereof are made available to the Borrower until the earlier of (i) the maturity
(whether by acceleration, optional or mandatory or otherwise) of such Base Rate
Loan and (ii) the conversion of such Base Rate Loan to a Eurodollar Loan
pursuant to Section 1.06, at a rate per annum which shall be equal to the sum of
the Applicable Margin plus the Base Rate in effect from time to time.
(b) The Borrower agrees to pay interest in respect of the unpaid
principal amount of each Eurodollar Loan from the date the proceeds thereof are
made available to the Borrower until the earlier of (i) the maturity (whether by
acceleration, optional or mandatory or otherwise) of such Eurodollar Loan and
(ii) the conversion of such Eurodollar Loan to a Base Rate Loan pursuant to
Section 1.06, 1.09 or 1.10, as applicable, at a rate per annum which shall,
during each Interest Period applicable thereto, be equal to the sum of the
Applicable Margin plus the Eurodollar Rate for such Interest Period.
(c) Overdue principal and, to the extent permitted by law, overdue
interest in respect of each Loan and any other overdue amount payable hereunder
shall, in each case, bear interest at a rate per annum equal to the greater of
(x) 2% per annum in excess of the rate otherwise applicable to Base Rate Loans
of the respective Tranche of Loans from time to time and (y) the rate which is
2% in excess of the rate then borne by such Loans, in each case with such
interest to be payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be payable (i) in
respect of each Base Rate Loan, quarterly in arrears on each Quarterly Payment
Date, (ii) in respect of each Eurodollar Loan, on the last day of each Interest
Period applicable thereto and, in the case of an Interest Period in excess of
three months, on each date occurring at three month intervals after the first
day of such Interest Period and (iii) in respect of each Term Loan, on any
repayment or prepayment (on the amount repaid or prepaid), and in respect of any
Loan at maturity (whether by acceleration or otherwise) and, after such
maturity, on demand.
(e) Upon each Interest Determination Date, the Administrative Agent
shall determine the Eurodollar Rate for each Interest Period applicable to
Eurodollar Loans and shall promptly notify the Borrower and the Banks thereof.
Each such determination shall, absent manifest error, be final and conclusive
and binding on all parties hereto.
1.09 INTEREST PERIODS. At the time it gives any Notice of Borrowing
or Notice of Conversion in respect of the making of, or conversion into, any
Eurodollar Loan (in the case of the initial Interest Period applicable thereto)
or on the third Business Day prior to the expiration
-8-
of an Interest Period applicable to such Eurodollar Loan (in the case of any
subsequent Interest Period), the Borrower shall have the right to elect, by
giving the Administrative Agent notice thereof, the interest period (each an
"Interest Period") applicable to such Eurodollar Loan, which Interest Period
shall, at the option of the Borrower, be a one, two, three or six-month period,
provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at all times
have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan shall
commence on the date of Borrowing of such Eurodollar Loan (including the
date of any conversion thereto from a Loan of a different Type) and each
Interest Period occurring thereafter in respect of such Eurodollar Loan
shall commence on the day on which the next preceding Interest Period
applicable thereto expires;
(iii) if any Interest Period relating to a Eurodollar Loan begins on
a day for which there is no numerically corresponding day in the calendar
month at the end of such Interest Period, such Interest Period shall end on
the last Business Day of such calendar month;
(iv) if any Interest Period would otherwise expire on a day which
is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day; PROVIDED, HOWEVER, that if any Interest Period for
a Eurodollar Loan would otherwise expire on a day which is not a Business
Day but is a day of the month after which no further Business Day occurs in
such month, such Interest Period shall expire on the next preceding
Business Day;
(v) no Interest Period may be selected at any time when a Default
or Event of Default is then in existence;
(vi) no Interest Period in respect of any Borrowing of A Term Loans
shall be selected which extends beyond the A Term Maturity Date;
(vii) no Interest Period in respect of any Borrowing of B Term Loans
shall be selected which extends beyond the B Term Maturity Date;
(viii) no Interest Period in respect of any Borrowing of C Term Loans
shall be selected which extends beyond the C Term Maturity Date;
(ix) no Interest Period in respect of any Borrowing of Revolving
Loans shall be selected which extends beyond the Revolving Loan Maturity
Date; and
(x) no Interest Period in respect of any Borrowing of any Tranche
of Term Loans shall be selected which extends beyond any date upon which a
mandatory repayment of such Tranche of Term Loans will be required to be made
under Section 4.02(A)(b), (c) or (d) if, after giving effect to the selection of
such Interest Period, the aggregate principal amount of Term Loans of such
Tranche which have Interest Periods which will expire after such date will be in
-9-
excess of the aggregate principal amount of Term Loans then outstanding less the
aggregate amount of such required repayment.
If upon the expiration of any Interest Period applicable to a
Borrowing of Eurodollar Loans, the Borrower has failed to elect, or is not
permitted to elect, a new Interest Period to be applicable to such Eurodollar
Loans as provided above, the Borrower shall be deemed to have elected to convert
such Eurodollar Loans into Base Rate Loans effective as of the expiration date
of such current Interest Period.
1.10 INCREASED COSTS, ILLEGALITY, ETC. (a) In the event that any
Bank shall have determined (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto but, with respect to
clause (i) below, may be made only by the Administrative Agent):
(i) on any Interest Determination Date that, by reason of any
changes arising after the date of this Agreement affecting the interbank
Eurodollar market, adequate and fair means do not exist for ascertaining
the applicable interest rate on the basis provided for in the definition of
Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased costs or
reductions in the amounts received or receivable hereunder with respect to
any Eurodollar Loan because of (x) any change since the date of this
Agreement in any applicable law or governmental rule, regulation, order,
guideline or request (whether or not having the force of law) or in the
interpretation or administration thereof and including the introduction of
any new law or governmental rule, regulation, order, guideline or request,
such as, for example, but not limited to: (A) a change in the basis of
taxation of payment to any Bank of the principal of or interest on such
Eurodollar Loan or any other amounts payable hereunder (except for changes
in the rate of tax on, or determined by reference to, the net income or
profits of such Bank, or any franchise tax based on the net income or
profits of such Bank, in either case pursuant to the laws of the United
States of America or the jurisdiction in which it is organized or in which
its principal office or applicable lending office is located or any
subdivision thereof or therein), but without duplication of any amounts
payable in respect of Taxes pursuant to Section 4.04(a), or (B) a change in
official reserve requirements, but, in all events, excluding reserves
required under Regulation D to the extent included in the computation of
the Eurodollar Rate and/or (y) other circumstances since the date of this
Agreement affecting such Bank or the interbank Eurodollar market; or
(iii) at any time, that the making or continuance of any Eurodollar
Loan has been made (x) unlawful by any law or governmental rule, regulation
or order, (y) impossible by compliance by any Bank in good faith with any
governmental request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the date of this
Agreement which materially and adversely affects the interbank Eurodollar
market;
then, and in any such event, such Bank (or the Administrative Agent, in the case
of clause (i) above) shall promptly give notice (by telephone confirmed in
writing) to the Borrower and, except
-10-
in the case of clause (i) above, to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly transmit to
each of the other Banks). Thereafter (x) in the case of clause (i) above,
Eurodollar Loans shall no longer be available until such time as the
Administrative Agent notifies the Borrower and the Banks that the circumstances
giving rise to such notice by the Administrative Agent no longer exist, and any
Notice of Borrowing or Notice of Conversion given by the Borrower with respect
to Eurodollar Loans which have not yet been incurred (including by way of
conversion) shall be deemed rescinded by the Borrower, (y) in the case of clause
(ii) above, the Borrower shall, subject to the provisions of Section 13.15 (to
the extent applicable), pay to such Bank, upon written demand therefor, such
additional amounts (in the form of an increased rate of, or a different method
of calculating, interest or otherwise as such Bank in its sole discretion shall
determine) as shall be required to compensate such Bank for such increased costs
or reductions in amounts received or receivable hereunder (a written notice as
to the additional amounts owed to such Bank, showing the basis for the
calculation thereof, submitted to the Borrower by such Bank in good faith shall,
absent manifest error, be final and conclusive and binding on all the parties
hereto) and (z) in the case of clause (iii) above, the Borrower shall take one
of the actions specified in Section 1.10(b) as promptly as possible and, in any
event, within the time period required by law. Each of the Administrative Agent
and each Bank agrees that if it gives notice to the Borrower of any of the
events described in clause (i) or (iii) above, it shall promptly notify the
Borrower and, in the case of any such Bank, the Administrative Agent, if such
event ceases to exist. If any such event described in clause (iii) above ceases
to exist as to a Bank, the obligations of such Bank to make Eurodollar Loans and
to convert Base Rate Loans into Eurodollar Loans on the terms and conditions
contained herein shall be reinstated.
(b) At any time that any Eurodollar Loan is affected by the
circumstances described in Section 1.10(a)(ii) or (iii), the Borrower may (and
in the case of a Eurodollar Loan affected by the circumstances described in
Section 1.10(a)(iii) shall) either (x) if the affected Eurodollar Loan is then
being made initially or pursuant to a conversion, cancel the respective
Borrowing by giving the Administrative Agent telephonic notice (confirmed in
writing) on the same date that the Borrower was notified by the affected Bank or
the Administrative Agent pursuant to Section 1.10(a)(ii) or (iii) or (y) if the
affected Eurodollar Loan is then outstanding, upon at least three Business Days'
written notice to the Administrative Agent, require the affected Bank to convert
such Eurodollar Loan into a Base Rate Loan, PROVIDED that, if more than one Bank
is affected at any time, then all affected Banks must be treated the same
pursuant to this Section 1.10(b).
(c) If at any time after the date of this Agreement any Bank
determines that the introduction of or any change in any applicable law or
governmental rule, regulation, order, guideline, directive or request (whether
or not having the force of law) concerning capital adequacy, or any change in
interpretation or administration thereof by any governmental authority, central
bank or comparable agency, will have the effect of increasing the amount of
capital required or expected to be maintained by such Bank or any corporation
controlling such Bank based on the existence of such Bank's Commitments
hereunder or its obligations hereunder, then the Borrower shall, subject to the
provisions of Section 13.15 (to the extent applicable), pay to such Bank, upon
its written demand therefor, such additional amounts as shall be required to
compensate such Bank or such other corporation for the increased cost to such
Bank or such
-11-
other corporation or the reduction in the rate of return to such Bank or such
other corporation as a result of such increase of capital. In determining
such additional amounts, each Bank will act reasonably and in good faith and
will use averaging and attribution methods which are reasonable, PROVIDED
that such Bank's reasonable good faith determination of compensation owing
under this Section 1.10(c) shall, absent manifest error, be final and conclusive
and binding on all the parties hereto. Each Bank, upon determining that any
additional amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall show the basis
for calculation of such additional amounts.
1.11 COMPENSATION. The Borrower shall, subject to the provisions of
Section 13.15 (to the extent applicable), compensate each Bank, upon its written
request (which request shall set forth the basis for requesting such
compensation), for all reasonable losses, expenses and liabilities (including,
without limitation, any loss, expense or liability incurred by reason of the
liquidation or reemployment of deposits or other funds required by such Bank to
fund its Eurodollar Loans but excluding any loss of anticipated profit) which
such Bank may sustain: (i) if for any reason (other than a default by such Bank
or the Administrative Agent) a Borrowing of, or conversion from or into,
Eurodollar Loans does not occur on a date specified therefor in a Notice of
Borrowing or Notice of Conversion (whether or not withdrawn by the Borrower or
deemed withdrawn pursuant to Section 1.10(a) or (b)); (ii) if any repayment
(including any repayment made pursuant to Section 4.02(A) or as a result of an
acceleration of the Loans pursuant to Section 10) or conversion of any of its
Eurodollar Loans occurs on a date which is not the last day of an Interest
Period with respect thereto; (iii) if any prepayment of any of its Eurodollar
Loans is not made on any date specified in a notice of prepayment given by the
Borrower; or (iv) as a consequence of (x) any other default by the Borrower to
repay its Loans when required by the terms of this Agreement or any Note held by
such Bank or (y) any election made pursuant to Section 1.10(b).
1.12 CHANGE OF LENDING OFFICE. Each Bank agrees that upon the
occurrence of any event giving rise to the operation of Section 1.10(a)(ii) or
(iii), Section 1.10(c), Section 2.05 or Section 4.04 with respect to such Bank,
it will, if requested by the Borrower, use reasonable efforts (subject to
overall policy considerations of such Bank) to designate another lending office
for any Loans affected by such event, PROVIDED that such designation is made on
such terms that such Bank and its lending office suffer no economic, legal or
regulatory disadvantage, with the object of avoiding the consequence of the
event giving rise to the operation of such Section. Nothing in this Section 1.12
shall affect or postpone any of the obligations of the Borrower or the right of
any Bank provided in Sections 1.10, 2.05 and 4.04.
1.13 REPLACEMENT OF BANKS. (x) If any Bank becomes a Defaulting Bank
or otherwise defaults in its obligations to make Loans or fund Unpaid Drawings,
(y) upon the occurrence of any event giving rise to the operation of Section
1.10(a)(ii) or (iii), Section 1.10(c), Section 2.05 or Section 4.04 with respect
to any Bank which results in such Bank charging to the Borrower increased costs
in excess of those being generally charged by the other Banks or (z) as provided
in Section 13.12(b) in the case of certain refusals by a Bank (other than a Bank
whose commitments are terminated in accordance with Section 3.02(b) and/or whose
Loans are repaid in accordance with Section 4.01(v)) to consent to certain
proposed changes, waivers, discharges or terminations with respect to this
Agreement which have been approved by the Required Banks,
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the Borrower shall have the right, if no Default or Event of Default will exist
immediately after giving effect to the respective replacement, to either replace
such Bank (the "Replaced Bank") with one or more other Eligible Transferee or
Transferees, none of whom shall constitute a Defaulting Bank at the time of such
replacement (collectively, the "Replacement Bank") reasonably acceptable to the
Administrative Agent or, at the option of the Borrower, to replace only (a) the
A Term Loan Commitment or A Term Loans of the Replaced Bank with an identical A
Term Loan Commitment or A Term Loans provided by the Replacement Bank, (b) the B
Term Loan Commitment or B Term Loans of the Replaced Bank with an identical B
Term Loan Commitment or B Term Loans provided by the Replacement Bank, (c) the C
Term Loan Commitment or C Term Loans of the Replaced Bank with an identical C
Term Loan Commitment or C Term Loans provided by the Replacement Bank or (d) the
Revolving Loan Commitment (and outstandings pursuant thereto) of the Replaced
Bank with an identical Revolving Loan Commitment provided by the Replacement
Bank, PROVIDED that (i) at the time of any replacement pursuant to this Section
1.13, the Replacement Bank shall enter into one or more Assignment and
Assumption Agreements pursuant to Section 13.04(b) (and with all fees payable
pursuant to said Section 13.04(b) to be paid by the Replacement Bank) pursuant
to which the Replacement Bank shall acquire all of the Commitments and
outstanding Loans (or, in the case of the replacement of only (a) the A Term
Loan Commitment or A Term Loans, the A Term Loan Commitment or A Term Loans, (b)
B Term Loan Commitment or B Term Loans, the B Term Loan Commitment or B Term
Loans, (c) C Term Loan Commitment or C Term Loans, the C Term Loan Commitment or
C Term Loans or (d) the Revolving Loan Commitment, the Revolving Loan Commitment
and outstanding Revolving Loans) of, and in each case (except for the
replacement of only the outstanding A Term Loans and/or B Term Loans and/or C
Term Loans of the respective Tranche or Tranches) participations in Letters of
Credit by, the Replaced Bank and, in connection therewith, shall pay to (x) the
Replaced Bank in respect thereof an amount equal to the sum of (A) an amount
equal to the principal of, and all accrued interest on, all outstanding Loans
(or of the Loans of the respective Tranche or Tranches being replaced) of the
Replaced Bank, (B) except for the replacement of only the outstanding A Term
Loans and/or B Term Loans and/or C Term Loans, an amount equal to all Unpaid
Drawings that have been funded by (and not reimbursed to) such Replaced Bank,
together with all then unpaid interest with respect thereto at such time and (C)
an amount equal to all accrued, but theretofore unpaid, Fees owing to the
Replaced Bank (but only with respect to the relevant Tranche, in the case of all
Tranches of Loans being held by the respective Replaced Bank) pursuant to
Section 3.01 and (y) except in the case of the replacement of only the
outstanding A Term Loans and/or B Term Loans and/or C Term Loans of the Replaced
Bank, any Issuing Bank an amount equal to such Replaced Bank's Adjusted
Percentage (for this purpose, determined as if the adjustment described in
clause (y) of the immediately succeeding sentence had been made with respect to
such Replaced Bank) of any Unpaid Drawing (which at such time remains an Unpaid
Drawing) to the extent such amount was not theretofore funded by such Replaced
Bank and (z) in the case of any replacement of Revolving Loan Commitments, the
Swingline Bank an amount equal to such Replaced Bank's Percentage of any
Mandatory Borrowing to the extent such amount was not theretofore funded by such
replaced Bank; and (ii) all Obligations of the Borrower owing to the Replaced
Bank (other than those specifically described in clause (i) above in respect of
which the assignment purchase price has been, or is concurrently being, paid)
shall be paid in full to such Replaced Bank concurrently with such replacement.
Upon the execution of the respective Assignment and
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Assumption Agreements, the payment of amounts referred to in clauses (i) and
(ii) above and, if so requested by the Replacement Bank, delivery to the
Replacement Bank of the appropriate Note or Notes executed by the Borrower, (x)
the Replacement Bank shall become a Bank hereunder and, unless the respective
Replaced Bank continues to have outstanding Loans or Commitments hereunder, the
Replaced Bank shall cease to constitute a Bank hereunder, except with respect to
indemnification provisions under this Agreement (including, without limitation,
Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06 as the same may be limited by
Section 13.15 (to the extent applicable)), which shall survive as to such
Replaced Bank and (y) in the case of a replacement of a Defaulting Bank with a
Non-Defaulting Bank the Adjusted Percentages of the Banks shall be automatically
adjusted at such time to give effect to such replacement (and to give effect to
the replacement of a Defaulting Bank with one or more Non-Defaulting Banks).
SECTION 2. Letters of Credit.
2.01 LETTERS OF CREDIT. (a) Subject to and upon the terms and
conditions herein set forth, the Borrower may request that any Issuing Bank with
a Revolving Loan Commitment issue, at any time and from time to time on and
after the Initial Borrowing Date and prior to the Revolving Loan Maturity Date,
for the account of the Borrower and for the benefit of any holder (or any
trustee, agent or other similar representative for any such holders) of L/C
Supportable Obligations of the Borrower or any of its Subsidiaries, an
irrevocable standby or commercial letter of credit, in a form customarily used
by such Issuing Bank or in such other form as has been approved by such Issuing
Bank (each such letter of credit, a "Letter of Credit") in support of such L/C
Supportable Obligations.
(b) Each Issuing Bank may agree in its sole discretion, and BTCo
hereby agrees that, in the event a requested Letter of Credit is not issued by
one of the other Issuing Banks, it will (subject to the terms and conditions
contained herein), at any time and from time to time on or after the Initial
Borrowing Date and prior to the Revolving Loan Maturity Date, following its
receipt of the respective Letter of Credit Request, issue for the account of the
Borrower one or more Letters of Credit, PROVIDED that the respective Issuing
Bank shall be under no obligation to issue any Letter of Credit of the types
described above if at the time of such issuance:
(i) any order, judgment or decree of any governmental authority or
arbitrator shall purport by its terms to enjoin or restrain such Issuing
Bank from issuing such Letter of Credit or any requirement of law
applicable to such Issuing Bank or any request or directive (whether or not
having the force of law) from any governmental authority with jurisdiction
over such Issuing Bank shall prohibit, or request that such Issuing Bank
refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon such Issuing Bank with respect to
such Letter of Credit any restriction or reserve or capital requirement
(for which such Issuing Bank is not otherwise compensated) not in effect on
the date hereof, or any unreimbursed loss, cost or expense which was not
applicable, in effect or known to such Issuing Bank as of the date hereof
and which such Issuing Bank in good xxxxx xxxxx material to it; or
(ii) such Issuing Bank shall have received notice prior to the
issuance of such Letter of Credit of the type described in the penultimate
sentence of Section 2.02(b).
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(c) Notwithstanding the foregoing, (i) no Letter of Credit shall be
issued the Stated Amount of which, when added to the Letter of Credit
Outstandings (exclusive of Unpaid Drawings which are repaid on the date of, and
prior to the issuance of, the respective Letter of Credit) at such time would
exceed either (x) $10,000,000 or (y) when added to the aggregate outstanding
principal amount of all Revolving Loans of Non-Defaulting Banks and all
Swingline Loans then outstanding, the Adjusted Total Revolving Loan Commitment;
(ii) each Letter of Credit shall be denominated in Dollars and shall be issued
only on a sight basis; and (iii) each Letter of Credit shall have an expiry date
occurring not later than the earlier of (x) 12 months (or 180 days in the case
of commercial Letters of Credit) after such Letter of Credit's date of issuance,
provided that the expiry date of any standby Letter of Credit may be
automatically extendible for successive periods of up to 12 months and (y) the
fifth Business Day (or the 30th day in the case of commercial Letters of Credit)
prior to the Revolving Loan Maturity Date.
2.02 LETTER OF CREDIT REQUESTS. (a) Whenever the Borrower desires
that a Letter of Credit be issued for its account, the Borrower shall give the
Administrative Agent and the respective Issuing Bank at least three Business
Days' (or such shorter period as is acceptable to the respective Issuing Bank)
written notice thereof. In the case of Letters of Credit to be issued pursuant
to Section 2.01, each notice shall be in the form of Exhibit C (each a "Letter
of Credit Request").
(b) The making of each Letter of Credit Request shall be deemed to be
a representation and warranty by the Borrower that such Letter of Credit may be
issued in accordance with, and will not violate the requirements of, Section
2.01(c). Unless the respective Issuing Bank has received notice from the
Borrower or the Required Banks before it issues a Letter of Credit that one or
more of the conditions specified in Section 5 or Section 6 are not then
satisfied, or that the issuance of such Letter of Credit would violate Section
2.01(c), then such Issuing Bank may issue the requested Letter of Credit for the
account of the Borrower in accordance with such Issuing Bank's usual and
customary practices. Upon its issuance of any Letter of Credit, such Issuing
Bank shall promptly notify each Bank participating therein of such issuance,
which notice shall be accompanied by a copy of the Letter of Credit actually
issued and any amendments thereto.
(c) In the event that the Issuing Bank of commercial Letters of
Credit is other than the Administrative Agent, such Issuing Bank will send by
facsimile transmission to the Administrative Agent, promptly on the first
Business Day, of each week, its daily aggregate Letter of Credit stated amount
for commercial Letters of Credit for the previous week. The Administrative
Agent shall deliver to each other Participant, upon each calendar month end, and
upon each Letter of Credit fee payment, a report setting forth for such period
the daily aggregate stated amount available to be drawn under the commercial
Letters of Credit issued by all the Issuing Banks during such period.
2.03 LETTER OF CREDIT PARTICIPATIONS. (a) Immediately upon the
issuance by any Issuing Bank of any Letter of Credit, such Issuing Bank shall be
deemed to have sold and transferred to each Bank with a Revolving Loan
Commitment, other than such Issuing Bank (each such Bank, in its capacity under
this Section 2.03, a "Participant"), and each such Participant shall be deemed
irrevocably and unconditionally to have purchased and received from such Issuing
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Bank, without recourse or warranty, an undivided interest and participation, to
the extent of such Participant's Adjusted Percentage in such Letter of Credit,
each drawing made thereunder and the obligations of the Borrower under this
Agreement with respect thereto, and any security therefor or guaranty pertaining
thereto (although the Letter of Credit Fee shall be payable directly to the
Administrative Agent for the account of the Participants as provided in Section
3.01(b) and the Participants shall have no right to receive any portion of any
Facing Fees). Upon any change in the respective Revolving Loan Commitments or
Adjusted Percentages of the Banks pursuant to Section 1.13 or 13.04 or as a
result of a Bank Default, it is hereby agreed that, with respect to all such
outstanding Letters of Credit and Unpaid Drawings, there shall be an automatic
adjustment to the participations pursuant to this Section 2.03 to reflect the
new Adjusted Percentages of the assignor and assignee Bank or of all Banks with
respective Revolving Loan Commitments.
(b) In determining whether to pay under any Letter of Credit, such
Issuing Bank shall have no obligation relative to the other Banks other than to
confirm that any documents required to be delivered under such Letter of Credit
appear to have been delivered and that they appear to substantially comply on
their face with the requirements of such Letter of Credit. Any action taken or
omitted to be taken by any Issuing Bank under or in connection with any Letter
of Credit if taken or omitted in the absence of gross negligence or willful
misconduct as determined by a court of competent jurisdiction, shall not create
for such Issuing Bank any resulting liability to the Borrower or any Bank.
(c) In the event that any Issuing Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to such Issuing Bank pursuant to Section 2.04(a), such Issuing Bank shall
promptly notify the Administrative Agent, which shall promptly notify each
Participant of such failure, and each Participant shall promptly and
unconditionally pay to such Issuing Bank the amount of such Participant's
Adjusted Percentage of such unreimbursed payment in Dollars and in same day
funds. If the Administrative Agent so notifies, prior to 11:00 A.M. (New York
time) on any Business Day, any Participant required to fund a payment under a
Letter of Credit, such Participant shall make available to such Issuing Bank in
Dollars such Participant's Adjusted Percentage of the amount of such payment on
such Business Day in same day funds. If and to the extent such Participant
shall not have so made its Adjusted Percentage of the amount of such payment
available to such Issuing Bank, such Participant agrees to pay to such Issuing
Bank, forthwith on demand such amount, together with interest thereon, for each
day from such date until the date such amount is paid to such Issuing Bank at
the overnight Federal Funds Rate. The failure of any Participant to make
available to such Issuing Bank its Adjusted Percentage of any payment under any
Letter of Credit shall not relieve any other Participant of its obligation
hereunder to make available to such Issuing Bank its Adjusted Percentage of any
Letter of Credit on the date required, as specified above, but no Participant
shall be responsible for the failure of any other Participant to make available
to such Issuing Bank such other Participant's Adjusted Percentage of any such
payment.
(d) Whenever any Issuing Bank receives a payment of a reimbursement
obligation as to which it has received any payments from the Participants
pursuant to clause (c) above, such Issuing Bank shall pay to each Participant
which has paid its Adjusted Percentage thereof, in Dollars and in same day
funds, an amount equal to such Participant's share (based upon the proportionate
aggregate amount originally funded by such Participant to the aggregate amount
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funded by all Participants) of the principal amount of such reimbursement
obligation and interest thereon accruing after the purchase of the respective
participations.
(e) The obligations of the Participants to make payments to each
Issuing Bank with respect to Letters of Credit issued by it shall be irrevocable
and not subject to any qualification or exception whatsoever and shall be made
in accordance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this Agreement or
any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other right
which the Borrower or any of its Subsidiaries may have at any time against
a beneficiary named in a Letter of Credit, any transferee of any Letter of
Credit (or any Person for whom any such transferee may be acting), the
Administrative Agent, any Issuing Bank, any Participant, or any other
Person, whether in connection with this Agreement, any Letter of Credit,
the transactions contemplated herein or any unrelated transactions
(including any underlying transaction between the Borrower and the
beneficiary named in any such Letter of Credit);
(iii) any draft, certificate or any other document presented under
any Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the Credit
Documents; or
(v) the occurrence of any Default or Event of Default.
2.04 AGREEMENT TO REPAY LETTER OF CREDIT DRAWINGS. (a) The Borrower
hereby agrees to reimburse the respective Issuing Bank, by making payment to the
Administrative Agent in immediately available funds at the Payment Office, for
any payment or disbursement made by it under any Letter of Credit (each such
amount, so paid until reimbursed, an "Unpaid Drawing"), no later than three
Business Days after the date of such payment or disbursement, with interest on
the amount so paid or disbursed by such Issuing Bank, to the extent not
reimbursed prior to 12:00 Noon (New York time) on the date of such payment or
disbursement, from and including the date paid or disbursed to but excluding the
date such Issuing Bank was reimbursed by the Borrower therefor at a rate per
annum which shall be the Base Rate in effect from time to time plus the
Applicable Margin for Revolving Loans maintained as Base Rate Loans; PROVIDED,
HOWEVER, to the extent such amounts are not reimbursed prior to 12:00 Noon
(New York time) on the fifth Business Day following notice of such payment or
disbursement, interest shall thereafter accrue on the amounts so paid or
disbursed by such Issuing Bank (and until reimbursed by the Borrower) at a rate
per annum which shall be the Base Rate in effect from time to time plus the
Applicable Margin for Revolving Loans maintained as Base Rate Loans plus 2%, in
each such case, with interest to be payable on demand. The respective Issuing
Bank shall give the Borrower prompt
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notice of each Drawing under any Letter of Credit, PROVIDED that the failure to
give any such notice shall in no way affect, impair or diminish the Borrower's
obligations hereunder.
(b) The obligations of the Borrower under this Section 2.04 to
reimburse the respective Issuing Bank with respect to drawings on Letters of
Credit (each, a "Drawing") (including, in each case, interest thereon) shall be
absolute and unconditional under any and all circumstances and irrespective of
any setoff, counterclaim or defense to payment which the Borrower may have or
have had against any Bank (including in its capacity as the issuer of the Letter
of Credit or as Participant), or any nonapplication or misapplication by the
beneficiary of the proceeds of such Drawing, the respective Issuing Bank's only
obligation to the Borrower being to confirm that any documents required to be
delivered under such Letter of Credit appear to have been delivered and that
they appear to comply on their face with the requirements of such Letter of
Credit. Any action taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit if taken or omitted in the absence of gross
negligence or willful misconduct as determined by a court of competent
jurisdiction, shall not create for such Issuing Bank any resulting liability to
the Borrower.
2.05 INCREASED COSTS. If at any time after the date of this
Agreement, the introduction of or any change in any applicable law, rule,
regulation, order, guideline or request or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by any Issuing Bank or
any Participant, or any corporation controlling such Person, with any request or
directive issued after the date of this Agreement by any such authority (whether
or not having the force of law), shall either (i) impose, modify or make
applicable any reserve, deposit, capital adequacy or similar requirement against
letters of credit issued by any Issuing Bank or participated in by any
Participant, or (ii) impose on any Issuing Bank or any Participant, or any
corporation controlling such Person, any other conditions relating, directly or
indirectly, to this Agreement or any Letter of Credit; and the result of any of
the foregoing is to increase the cost to any Issuing Bank or any Participant of
issuing, maintaining or participating in any Letter of Credit, or reduce the
amount of any sum received or receivable by any Issuing Bank or any Participant
hereunder or reduce the rate of return on its capital with respect to Letters of
Credit (except for changes in the rate of tax on, or determined by reference to,
the net income or profits of such Issuing Bank or such Participant, or any
corporation controlling such Person, or any franchise tax based on the net
income or profits of such Bank or Participant, or any corporation controlling
such Person, in either case pursuant to the laws of the United States of
America, the jurisdiction in which it is organized or in which its principal
office or applicable lending office is located or any subdivision thereof or
therein), but without duplication of any amounts payable in respect of taxes
pursuant to Section 4.04(a), then, upon demand to the Borrower by such Issuing
Bank or any Participant (a copy of which demand shall be sent by such Issuing
Bank or such Participant to the Administrative Agent) and subject to the
provisions of Section 13.15 (to the extent applicable), the Borrower shall pay
to such Issuing Bank or such Participant such additional amount or amounts as
will compensate such Bank for such increased cost or reduction in the amount
receivable or reduction on the rate of return on its capital. Any Issuing Bank
or any Participant, upon determining that any additional amounts will be payable
pursuant to this Section 2.05, will give prompt written notice thereof to the
Borrower, which notice shall include a certificate submitted to the Borrower by
such Issuing Bank or such Participant (a copy of which certificate shall be sent
by such Issuing Bank or such Participant to
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the Administrative Agent), setting forth in reasonable detail the basis for the
calculation of such additional amount or amounts necessary to compensate such
Issuing Bank or such Participant. The certificate required to be delivered
pursuant to this Section 2.05 shall, if delivered in good faith and absent
manifest error, be final and conclusive and binding on the Borrower.
SECTION 3. Commitment Commission; Fees; Reductions of Commitment.
3.01 FEES. (a) The Borrower agrees to pay the Administrative Agent
for distribution to each Non-Defaulting Bank a commitment commission (the
"Commitment Commission") for the period from the Initial Borrowing Date to and
including the Revolving Loan Maturity Date (or such earlier date as the Total
Revolving Loan Commitment shall have been terminated), computed at a rate for
each day equal to 1/2 of 1% per annum on the daily average Unutilized Revolving
Loan Commitment of such Non-Defaulting Bank. Accrued Commitment Commission
shall be due and payable quarterly in arrears on each Quarterly Payment Date and
on the Revolving Loan Maturity Date or such earlier date upon which the Total
Revolving Loan Commitment is terminated.
(b) The Borrower agrees to pay to the Administrative Agent for
distribution to each Non-Defaulting Bank with a Revolving Loan Commitment, as
the case may be (based on their respective Adjusted Percentages), a fee in
respect of each Letter of Credit issued hereunder (the "Letter of Credit Fee"),
for the period from and including the date of issuance of such Letter of Credit,
to and including the termination of such Letter of Credit computed at a rate per
annum equal to the Applicable Margin for Revolving Loans maintained as
Eurodollar Loans as in effect from time to time on the daily Stated Amount of
such Letter of Credit. Accrued Letter of Credit Fees shall be due and payable
quarterly in arrears on each Quarterly Payment Date and upon the first day on or
after the termination of the Total Revolving Loan Commitment upon which no
Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to the respective Issuing Bank, for
its own account, a facing fee in respect of each Letter of Credit issued for its
account hereunder (the "Facing Fee") for the period from and including the date
of issuance of such Letter of Credit to and including the termination of such
Letter of Credit, computed at a rate equal to 1/4 of 1% per annum of the daily
Stated Amount of such Letter of Credit, PROVIDED, that in no event shall the
annual Facing Fee be less than $500. Accrued Facing Fees shall be due and
payable quarterly in arrears on each Quarterly Payment Date and upon the first
day on or after the termination of the Total Revolving Loan Commitment upon
which no Letters of Credit remain outstanding.
(d) The Borrower shall pay, upon each payment under, issuance of, or
amendment to, any Letter of Credit, such amount as shall at the time of such
event be the administrative charge which the respective Issuing Bank is
generally imposing in connection with such occurrence with respect to letters of
credit.
(e) The Borrower shall pay to the Administrative Agent, for its own
account, such other fees as have been agreed to in writing by the Borrower and
the Administrative Agent.
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3.02 VOLUNTARY TERMINATION AND REDUCTION OF COMMITMENTS. (a) Upon
at least two Business Days' prior written notice (or telephonic notice confirmed
in writing) to the Administrative Agent at its Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks), the Borrower
shall have the right, at any time or from time to time, without premium or
penalty, to terminate or partially reduce the Total Unutilized Revolving Loan
Commitment, in whole or in part, PROVIDED that (x) each such reduction shall
apply proportionately to permanently reduce the Revolving Loan Commitment of
each Bank with a Revolving Loan Commitment, (y) any partial reduction pursuant
to this Section 3.02 shall be in integral multiples of $500,000 and (z) the
reduction to the Total Unutilized Revolving Loan Commitment shall in no case be
in an amount which would cause the Revolving Loan Commitment of any Bank to be
reduced (as required by the preceding clause (x)) by an amount which exceeds the
remainder of (x) the Unutilized Revolving Loan Commitment of such Bank as in
effect immediately before giving effect to such reduction minus (y) such Bank's
Adjusted Percentage of the aggregate principal amount of Swingline Loans then
outstanding.
(b) In the event of certain refusals by a Bank as provided in Section
13.12(b) to consent to certain proposed changes, waivers, discharges or
terminations with respect to this Agreement which have been approved by the
Required Banks, the Borrower may, upon five Business Days' written notice to the
Administrative Agent at its Notice Office (which notice the Administrative Agent
shall promptly transmit to each of the Banks) terminate all of the Revolving
Loan Commitment of such Bank, so long as (i) all Loans, together with accrued
and unpaid interest, Fees and other amounts, owing to such Bank are repaid
concurrently with the effectiveness of such termination (at which time Schedule
I shall be deemed modified to reflect such changed amounts), and at such time
such Bank shall no longer constitute a "Bank" for purposes of this Agreement,
except with respect to indemnifications under this Agreement (including, without
limitation, Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06 as the same may be
limited by Section 13.15 (to the extent applicable)), which shall survive as to
such repaid Bank and (ii) the Administrative Agent and each other Bank which
will be party to this Agreement after giving effect to such change, waiver,
discharge or termination with respect to this Agreement consents to such
termination of Revolving Loan Commitment and repayment of Loans.
3.03 MANDATORY REDUCTION OF COMMITMENTS. (a) In addition to any
other mandatory commitment reductions pursuant to this Section 3.03, the Total A
Term Loan Commitment (and the A Term Loan Commitment of each Bank) shall (i)
terminate in its entirety on the Initial Borrowing Date (after giving effect to
the incurrence of A Term Loans on such date) and (ii) prior to the termination
of the Total A Term Loan Commitment as provided in clause (i) above, be reduced
from time to time to the extent required by Section 4.02(A).
(b) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total B Term Loan Commitment (and the B Term Loan
Commitment of each Bank) shall (i) terminate in its entirety on the Initial
Borrowing Date (after giving effect to the making of the B Term Loans on such
date) and (ii) prior to the termination of the Total B Term Loan Commitment as
provided in clause (i) above, be reduced from time to time to the extent
required by Section 4.02(A).
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(c) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total C Term Loan Commitment (and the C Term Loan
Commitment of each Bank) shall (i) terminate in its entirety on the Initial
Borrowing Date (after giving effect to the making of C Term Loans on such date)
and (ii) prior to the termination of the Total C Term Loan Commitment as
provided in clause (i) above, be reduced from time to time to the extent
required by Section 4.02(A).
(d) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, the Total Revolving Loan Commitment (and the Revolving
Loan Commitment of each Bank) shall terminate in its entirety on the Revolving
Loan Maturity Date.
(e) In addition to any other mandatory commitment reductions pursuant
to this Section 3.03, on each date after the Initial Borrowing Date upon which a
mandatory prepayment of Term Loans pursuant to Sections 4.02(A)(e), (f), (g),
(h) or (i) is required (and exceeds in amount the aggregate principal amount of
Term Loans then outstanding) or would be required if Term Loans were then
outstanding, the Total Revolving Loan Commitment shall be permanently reduced by
the amount, if any, by which the amount required to be applied pursuant to said
Section (determined as if an unlimited amount of Term Loans were actually
outstanding) exceeds the aggregate principal amount of Term Loans then
outstanding.
(f) Each reduction to the Total A Term Loan Commitment, the Total B
Term Loan Commitment, the Total C Term Loan Commitment and/or the Total
Revolving Loan Commitment pursuant to this Section 3.03 (or pursuant to Section
4.02(A)) shall be applied proportionately to reduce the A Term Loan Commitment,
the B Term Loan Commitment, the C Term Loan Commitment or the Revolving Loan
Commitment, as the case may be, of each Bank with such a Commitment.
SECTION 4. Prepayments; Payments; Taxes.
4.01 VOLUNTARY PREPAYMENTS. The Borrower shall have the right to
prepay the Loans, without premium or penalty, in whole or in part at any time
and from time to time on the following terms and conditions: (i) the Borrower
shall give the Administrative Agent prior to 12:00 Noon (New York time) at its
Notice Office (x) at least one Business Day's prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to prepay Base
Rate Loans (or, in the case of Swingline Loans prior to 1:00 p.m. (New York
time) on the date of such prepayment) and (y) at least three Business Days'
prior written notice (or telephonic notice promptly confirmed in writing) of its
intent to prepay Eurodollar Loans, whether A Term Loans, B Term Loans, C Term
Loans or Revolving Loans shall be prepaid, the amount of such prepayment and the
Types of Loans to be prepaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings pursuant to which made, which notice the Administrative
Agent shall promptly transmit to each of the Banks; (ii) each prepayment shall
be in an aggregate principal amount of at least $250,000 (or in the case of
Swingline Loans, $10,000 and, if greater, in an integral multiple of $5,000),
PROVIDED that if any partial prepayment of Eurodollar Loans made pursuant to any
Borrowing shall reduce the outstanding Eurodollar Loans made pursuant to such
Borrowing to an amount less than (1) in the case of A Term Loans, $5,000,000,
(2) in the case of B Term Loans, $5,000,000, (3) in the case of C Term Loans,
$5,000,000 and (4) in the
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case of Revolving Loans, $1,000,000, then such Borrowing shall be converted at
the end of the then current Interest Period into a Borrowing of Base Rate Loans;
(iii) prepayments of Eurodollar Loans made pursuant to this Section 4.01 made on
any day other than the last day of an Interest Period applicable thereto shall
be subject to the provisions of Section 1.11; (iv) each prepayment in respect of
any Loans made pursuant to a Borrowing shall, except as provided in clauses (v)
and (vi) below, be applied PRO RATA among the Banks which made such Loans; (v)
in the event of certain refusals by a Bank as provided in Section 13.12(b) to
consent to certain proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the Required Banks, the
Borrower may, upon five Business Days' written notice to the Administrative
Agent at its Notice Office (which notice the Administrative Agent shall promptly
transmit to each of the Banks) repay all Loans, together with accrued and unpaid
interest, Fees and other amounts, owing to such Bank so long as (A) the
Revolving Loan Commitment of such Bank is terminated concurrently with such
repayment (at which time Schedule I shall be deemed modified to reflect such
changed amounts) and (B) the Administrative Agent and each other Bank which will
be party to this Agreement after giving effect to such change, waiver, discharge
or termination with respect to this Agreement consents to such repayment of
Loans and such termination of Revolving Loan Commitment; (vi) at the Borrower's
election in connection with any prepayment of Revolving Loans, such prepayment
shall not be applied to the Revolving Loans of a Defaulting Bank; and (vii) each
voluntary prepayment of Term Loans made pursuant to this Section 4.01 (other
than prepayments made pursuant to preceding clause (v)) shall be applied to the
A Term Loans, the B Term Loans and the C Term Loans on a PRO RATA basis (based
upon the then outstanding principal amount of A Term Loans, B Term Loans and C
Term Loans) to reduce the then remaining Scheduled Repayments of the respective
Tranche of Term Loans PRO RATA based upon the then remaining amount of such
Scheduled Repayments after giving effect to all prior reductions thereto.
4.02 MANDATORY REPAYMENTS AND COMMITMENT REDUCTIONS. (A) (a) (i) On
any day on which the sum of the aggregate outstanding principal amount of the
Revolving Loans made by the Non-Defaulting Banks, Swingline Loans and the Letter
of Credit Outstandings exceeds the Adjusted Total Revolving Loan Commitment as
then in effect, the Borrower shall prepay on such date the principal of
Swingline Loans and after the Swingline Loans have been repaid in full, the
principal of Revolving Loans of the Non-Defaulting Banks in an amount equal to
such excess. If, after giving effect to the prepayment of all outstanding
Swingline Loans and all outstanding Revolving Loans of Non-Defaulting Banks, the
aggregate amount of the Letter of Credit Outstandings exceeds the Adjusted Total
Revolving Loan Commitment as then in effect, the Borrower shall pay to the
Administrative Agent at the Payment Office on such date an amount of cash or
Cash Equivalents equal to the amount of such excess (up to a maximum amount
equal to the Letter of Credit Outstandings at such time), such cash or Cash
Equivalents to be held as security for all obligations of the Borrower to
Non-Defaulting Banks under Section 2.04(a) in a cash collateral account to be
established by the Administrative Agent. Such cash or Cash Equivalents shall be
released to the Borrower when such obligations under Section 2.04(a) are
satisfied or as may be necessary to insure that the amount of such cash or Cash
Equivalents do not exceed the Letter of Credit Outstandings.
(ii) On any day on which the aggregate outstanding principal amount
of the Revolving Loans made by any Defaulting Bank exceeds the Revolving Loan
Commitment of such
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Defaulting Bank, the Borrower shall prepay principal of Revolving Loans of such
Defaulting Bank in an amount equal to such excess.
(b) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date set forth below, the
Borrower shall be required to repay that principal amount of A Term Loans, to
the extent then outstanding, as is set forth opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01 and
4.02(A)(j), an "A Term Loan Scheduled Repayment"):
Scheduled Repayment Date Amount
------------------------ ------
Quarterly Payment Date in August 1998 $125,000
Quarterly Payment Date in November 1998 $125,000
Quarterly Payment Date in February 1999 $125,000
Quarterly Payment Date in May 1999 $125,000
Quarterly Payment Date in August 1999 $1,250,000
Quarterly Payment Date in November 1999 $1,250,000
Quarterly Payment Date in February 2000 $1,250,000
Quarterly Payment Date in May 2000 $1,250,000
Quarterly Payment Date in August 2000 $1,875,000
Quarterly Payment Date in November 2000 $1,875,000
Quarterly Payment Date in February 2001 $1,875,000
Quarterly Payment Date in May 2001 $1,875,000
Quarterly Payment Date in August 2001 $3,125,000
Quarterly Payment Date in November 2001 $3,125,000
Quarterly Payment Date in February 2002 $3,125,000
Quarterly Payment Date in May 2002 $3,125,000
Quarterly Payment Date in August 2002 $3,125,000
Quarterly Payment Date in November 2002 $3,125,000
Quarterly Payment Date in February 2003 $3,125,000
Quarterly Payment Date in May 2003 $3,125,000
Quarterly Payment Date in August 2003 $3,000,000
Quarterly Payment Date in November 2003 $3,000,000
Quarterly Payment Date in February 2004 $3,000,000
A Term Maturity Date $3,000,000
; PROVIDED that in the event the aggregate principal amount of A Term Loans
incurred at the time that the Total A Term Loan Commitment is terminated in
accordance with Section 3.03(a) is less than $50,000,000, an amount equal to
such deficiency shall be applied to reduce the A Term Loan
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Scheduled Repayments PRO RATA based on the then remaining principal amount of
each such A Term Loan Scheduled Repayment.
(c) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date set forth below, the
Borrower shall be required to repay that principal amount of B Term Loans, to
the extent then outstanding, as is set forth opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01 and
4.02(A)(j), a "B Term Loan Scheduled Repayment"):
Scheduled Repayment Date Amount
------------------------ ------
Quarterly Payment Date in August 1998 $77,500
Quarterly Payment Date in November 1998 $77,500
Quarterly Payment Date in February 1999 $77,500
Quarterly Payment Date in May 1999 $77,500
Quarterly Payment Date in August 1999 $77,500
Quarterly Payment Date in November 1999 $77,500
Quarterly Payment Date in February 2000 $77,500
Quarterly Payment Date in May 2000 $77,500
Quarterly Payment Date in August 2000 $77,500
Quarterly Payment Date in November 2000 $77,500
Quarterly Payment Date in February 2001 $77,500
Quarterly Payment Date in May 2001 $77,500
Quarterly Payment Date in August 2001 $77,500
Quarterly Payment Date in November 2001 $77,500
Quarterly Payment Date in February 2002 $77,500
Quarterly Payment Date in May 2002 $77,500
Quarterly Payment Date in August 2002 $77,500
Quarterly Payment Date in November 2002 $77,500
Quarterly Payment Date in February 2003 $77,500
Quarterly Payment Date in May 2003 $77,500
Quarterly Payment Date in August 2003 $77,500
Quarterly Payment Date in November 2003 $77,500
Quarterly Payment Date in February 2004 $77,500
Quarterly Payment Date in May 2004 $77,500
Quarterly Payment Date in August 2004 $7,285,000
Quarterly Payment Date in November 2004 $7,285,000
Quarterly Payment Date in February 2005 $7,285,000
B Term Maturity Date $7,285,000
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; PROVIDED that in the event the aggregate principal amount of B Term Loans
incurred at the time that the Total B Term Loan Commitment is terminated in
accordance with Section 3.03(b) is less than $31,000,000, an amount equal to
such deficiency shall be applied to reduce the B Term Loan Scheduled Repayments
PRO RATA based on the then remaining principal amount of each such B Term Loan
Scheduled Repayment.
(d) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date set forth below, the
Borrower shall be required to repay that principal amount of C Term Loans, to
the extent then outstanding, as is set forth opposite such date (each such
repayment, as the same may be reduced as provided in Sections 4.01 and
4.02(A)(j), a "C Term Loan Scheduled Repayment", and together with each A Term
Loan Scheduled Repayment and B Term Loan Scheduled Repayment, the "Scheduled
Repayments"):
Scheduled Repayment Date Amount
------------------------ ------
Quarterly Payment Date in August 1998 $75,000
Quarterly Payment Date in November 1998 $75,000
Quarterly Payment Date in February 1999 $75,000
Quarterly Payment Date in May 1999 $75,000
Quarterly Payment Date in August 1999 $75,000
Quarterly Payment Date in November 1999 $75,000
Quarterly Payment Date in February 2000 $75,000
Quarterly Payment Date in May 2000 $75,000
Quarterly Payment Date in August 2000 $75,000
Quarterly Payment Date in November 2000 $75,000
Quarterly Payment Date in February 2001 $75,000
Quarterly Payment Date in May 2001 $75,000
Quarterly Payment Date in August 2001 $75,000
Quarterly Payment Date in November 2001 $75,000
Quarterly Payment Date in February 2002 $75,000
Quarterly Payment Date in May 2002 $75,000
Quarterly Payment Date in August 2002 $75,000
Quarterly Payment Date in November 2002 $75,000
Quarterly Payment Date in February 2003 $75,000
Quarterly Payment Date in May 2003 $75,000
Quarterly Payment Date in August 2003 $75,000
Quarterly Payment Date in November 2003 $75,000
Quarterly Payment Date in February 2004 $75,000
Quarterly Payment Date in May 2004 $75,000
Quarterly Payment Date in August 2004 $75,000
-25-
Quarterly Payment Date in November 2004 $75,000
Quarterly Payment Date in February 2005 $75,000
Quarterly Payment Date in May 2005 $75,000
Quarterly Payment Date in August 2005 $6,975,000
Quarterly Payment Date in November 2005 $6,975,000
Quarterly Payment Date in February 2006 $6,975,000
C Term Maturity Date $6,975,000
; PROVIDED that in the event the aggregate principal amount of C Term Loans
incurred at the time that the Total C Term Loan Commitment is terminated in
accordance with Section 3.03(c) is less than $30,000,000, an amount equal to
such deficiency shall be applied to reduce the C Term Loan Scheduled Repayments
PRO RATA based on the then remaining principal amount of each such C Term Loan
Scheduled Repayment.
(e) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date after the Effective
Date upon which Holdings or any of its Subsidiaries receives any proceeds from
any sale or issuance of its common stock pursuant to an underwritten public
offering pursuant to a registration statement filed with the SEC (other than
equity issued to American Industrial Partners Capital Fund II, L.P. ("AIPCF") or
its affiliates) an amount equal to 50% of the cash proceeds (excluding any such
proceeds attributable to or relating to direct or indirect equity interests of
Persons other than AIPCF, Holdings or its Subsidiaries) of the respective sale
or issuance (net of all reasonable costs associated therewith, including,
without limitation, all due diligence costs and expenses paid for, or reimbursed
by, Holdings and/or any of its Subsidiaries, underwriting or similar fees,
discounts and commissions, attorneys' fees and expenses paid for, or reimbursed
by, Holdings and/or any of its Subsidiaries and other costs associated
therewith) shall be applied as a mandatory repayment of principal of outstanding
Term Loans (or, if the Initial Borrowing Date has not yet occurred, such amounts
shall be applied as a mandatory reduction to the Total Term Loan Commitment) in
accordance with the requirements of Sections 4.02(A)(j) and (k).
(f) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date after the Effective
Date upon which Holdings or any of its Subsidiaries receives any proceeds from
any incurrence by Holdings or any of its Subsidiaries of Indebtedness for
borrowed money (other than Indebtedness for borrowed money permitted to be
incurred pursuant to Section 9.04), an amount equal to 100% of the cash proceeds
of the respective incurrence of Indebtedness (net of all reasonable costs
associated therewith, including, without limitation, all due diligence costs and
expenses paid for, or reimbursed by, Holdings and/or any of its Subsidiaries,
any underwriting, agency, structuring or similar fees, discounts and
commissions, attorneys' fees and expenses paid for, or reimbursed by, Holdings
and/or any of its Subsidiaries, all financing and/or commitment fees and other
costs associated therewith) shall be applied as a mandatory repayment of
principal of outstanding Term Loans (or, if the Initial Borrowing Date has not
yet occurred, such amounts shall be applied as a
-26-
mandatory reduction to the Total Term Loan Commitment) in accordance with the
requirements of Sections 4.02(A)(j) and (k).
(g) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), on each date after the Effective
Date upon which Holdings or any of its Subsidiaries receives proceeds from any
Asset Sale, an amount equal to 100% of the Net Sale Proceeds therefrom shall be
applied as a mandatory repayment of principal of outstanding Term Loans (or, if
the Initial Borrowing Date has not yet occurred, such amounts shall be applied
as a mandatory reduction to the Total Term Loan Commitment) in accordance with
the requirements of Sections 4.02(A)(j) and (k), PROVIDED that (i) up to an
aggregate of $5,000,000 of Net Sale Proceeds from Asset Sales shall not be
required to be used to so repay Term Loans and (ii) up to an additional
aggregate of $10,000,000 per fiscal year of the Borrower of Net Sale Proceeds
from Asset Sales shall not be required to be used to so repay Term Loans in any
fiscal year of the Borrower to the extent the Borrower elects, as hereinafter
provided, to cause such Net Sale Proceeds to be reinvested in Reinvestment
Assets (a "Reinvestment Election"). The Borrower may exercise its Reinvestment
Election (within the parameters specified in the preceding sentence) with
respect to an Asset Sale if (x) no Default or Event of Default exists and (y)
the Borrower delivers a Reinvestment Notice to the Administrative Agent within
fifteen Business Days following the date of the consummation of the respective
Asset Sale, with such Reinvestment Election being effective with respect to the
Net Sale Proceeds of such Asset Sale equal to the Anticipated Reinvestment
Amount specified in such Reinvestment Notice and, PROVIDED FURTHER, that if all
or any portion of such Net Sale Proceeds not applied to the repayment of Term
Loans pursuant to the preceding proviso are either (a) not so used or agreed
(which agreement may be subject to conditions) to be used within 180 days after
the date of receipt of such Net Sale Proceeds or (b) if agreed to be so used
within 180 days after the date of receipt of such Net Sale Proceeds and not so
used within 360 days after the date of receipt of such Net Sale Proceeds, then,
in either such case, such remaining portion not used or agreed to be used in the
case of preceding clause (a) and not used in the case of preceding clause (b)
shall be applied on the date which is 180 days following the date of receipt of
such Net Sale Proceeds in the case of clause (a) above, or the date occurring on
the date which is 360 days after the date of receipt of such Net Sale Proceeds
in the case of clause (b) above as a mandatory repayment of principal of
outstanding Term Loans in accordance with the requirements of Sections
4.02(A)(j) and (k). At the time of the acquisition of any Reinvestment Assets,
Holdings shall comply and shall cause its Subsidiaries to comply with Section
8.11, to the extent applicable.
(h) In addition to any other mandatory repayments pursuant to this
Section 4.02(A), on each Excess Cash Payment Date, an amount equal to 50% of the
Excess Cash Flow for the relevant Excess Cash Payment Period shall be applied as
a mandatory repayment of principal of outstanding Term Loans in accordance with
the requirements of Sections 4.02(A)(j) and (k).
(i) In addition to any other mandatory repayments or commitment
reductions pursuant to this Section 4.02(A), within 90 days following each date
after the Effective Date on which Holdings or any of its Subsidiaries receives
any proceeds from any Recovery Event, an amount equal to 100% of the proceeds of
such Recovery Event (net of reasonable costs including, without limitation,
legal costs and expenses and taxes incurred in connection with such Recovery
-27-
Event) shall be applied as a mandatory repayment of principal of outstanding
Term Loans (or, if the Initial Borrowing Date has not yet occurred, such amounts
shall be applied as a mandatory reduction to the Total Term Loan Commitment) in
accordance with the requirements of Sections 4.02(A)(j) and (k), PROVIDED that
(x) so long as no Default or Event of Default then exists and such proceeds do
not exceed $10,000,000, such proceeds shall not be required to be so applied on
such date to the extent that the Borrower has delivered a certificate to the
Administrative Agent on or prior to such date stating that such proceeds shall
be used to replace or restore any properties or assets in respect of which such
proceeds were paid within 180 days following the date of such Recovery Event
(which certificate shall set forth the estimates of the proceeds to be so
expended) and (y) so long as no Default or Event of Default then exists and to
the extent that (a) the amount of such proceeds exceeds $10,000,000, (b) the
Borrower has delivered to the Administrative Agent a certificate on or prior to
the date the application would otherwise be required pursuant to this Section
4.02(A)(i) in the form described in clause (x) above and (c) the Borrower has
delivered to the Administrative Agent either (i) a certification that such
Recovery Event is not reasonably expected to result in a Default or Event of
Default or (ii) such evidence as the Administrative Agent may reasonably request
in form and substance satisfactory to the Administrative Agent establishing that
the Borrower has sufficient business interruption insurance and that the
Borrower will be receiving regular payments thereunder in such amounts and at
such times as are necessary to satisfy all material obligations and expenses of
the Borrower (including, without limitation, all debt service requirements,
including pursuant to this Agreement), without any delay or extension thereof,
for the period from the date of the respective casualty, condemnation or other
event giving rise to the Recovery Event and continuing through the completion of
the replacement or restoration of respective properties or assets, then the
entire amount and not just the portion in excess of $10,000,000 shall be
deposited with the Administrative Agent pursuant to a cash collateral
arrangement reasonably satisfactory to the Administrative Agent whereby such
proceeds shall be disbursed to the Borrower from time to time as needed to pay
actual costs incurred by it in connection with the replacement or restoration of
the respective properties or assets (pursuant to such certification requirements
as may be established by the Administrative Agent), PROVIDED FURTHER, that at
any time while an Event of Default has occurred and is continuing (other than an
Event of Default existing solely as a result of the violation of any or both of
Sections 9.08 and 9.09, but in each case only if, and to the extent, that the
violation of said covenant has occurred as a result of the underlying event
giving rise to the Recovery Event), the Required Banks may direct the
Administrative Agent (in which case the Administrative Agent shall, and is
hereby authorized by the Borrower to, follow said directions) to apply any or
all proceeds then on deposit in such collateral account to the repayment of
Obligations hereunder in the same manner as proceeds would be applied pursuant
to the Security Agreement, and, PROVIDED FURTHER, that if all or any portion of
such proceeds not required to be applied to the repayment of Term Loans pursuant
to clause (x) above are either (A) not so used within 180 days after the date of
receipt of proceeds from the respective Recovery Event or (B) if agreed (which
agreement may be subject to conditions) to be used within 180 days after the
date of receipt of proceeds from the respective Recovery Event and not so used
within 360 days after the date of receipt of proceeds from the respective
Recovery Event, then, in either case, such remaining portion not used or agreed
to be used in the case of the preceding clause (A) and not used in the case of
preceding clause (B), shall be applied on the date which is 180 days following
the date of receipt of proceeds from the respective Recovery Event in the case
of clause
-28-
(A) above, or the date which is 360 days after the date of receipt of proceeds
from the respective Recovery Event in the case of clause (B) above as a
mandatory repayment of principal of outstanding Term Loans in accordance with
the requirements of Section 4.02(A)(j) and (k), and, PROVIDED FURTHER, that if
all or any portion of such proceeds not required to be applied to the repayment
of Term Loans pursuant to clause (y) above are either not so used or agreed to
be used (which agreement may be subject to conditions) within 270 days after the
date of receipt of proceeds from the respective Recovery Event, then, such
remaining portion not used or agreed to be used, shall be applied on the date
which is 270 days following the date of receipt of proceeds from the respective
Recovery Event as a mandatory repayment of principal of outstanding Term Loans
in accordance with the requirements of Section 4.02(A)(j) and (k). If it is
subsequently determined that any portion of such proceeds that are agreed to be
so used will not be so used, then, within ten Business Days following such
determination, such amounts shall be applied as a mandatory repayment of
principal of outstanding Term Loans in accordance with the requirements of
Section 4.02(A)(j) and (k).
(j) Each amount required to be applied to repay Term Loans (or to
reduce the Total Term Loan Commitment) pursuant to Sections 4.02(A)(e), (f),
(g), (h) and (i) shall be applied to the A Term Loans, the B Term Loans and the
C Term Loans on a PRO RATA basis (based upon the then outstanding principal
amount of A Term Loans, B Term Loans and C Term Loans) to reduce the then
remaining Scheduled Repayments of the respective Tranche of Term Loans PRO RATA
based upon the then remaining amount of Scheduled Repayments of such Tranche of
Term Loans after giving effect to all prior reductions thereto.
(k) With respect to each repayment of Loans required by this Section
4.02(A), the Borrower may designate the Types of Loans of the respective Tranche
which are to be repaid and, in the case of Eurodollar Loans, the specific
Borrowing or Borrowings of the respective Tranche pursuant to which made,
PROVIDED that: (i) repayments of Eurodollar Loans pursuant to this Section
4.02(A) may only be made on the last day of an Interest Period applicable
thereto unless all Eurodollar Loans of the respective Tranche with Interest
Periods ending on such date of required repayment and all Base Rate Loans of the
respective Tranche have been paid in full; (ii) if any repayment of Eurodollar
Loans made pursuant to a single Borrowing shall reduce the outstanding
Eurodollar Loans made pursuant to such Borrowing to an amount less than (w) in
the case of A Term Loans, $5,000,000, (x) in the case of B Term Loans,
$5,000,000, (y) in the case of C Term Loans, $5,000,000 and (z) in the case of
Revolving Loans, $1,000,000, such Borrowing shall be converted at the end of the
then current Interest Period into a Borrowing of Base Rate Loans; and (iii) each
repayment of any Loans made pursuant to a Borrowing shall be applied PRO RATA
among the Banks which made such Loans. In the absence of a designation by the
Borrower as described in the preceding sentence, the Administrative Agent shall,
subject to the above, make such designation in its sole discretion with a view,
but no obligation, to minimize breakage costs owing under Section 1.11.
Notwithstanding the foregoing provisions of this Section 4.02(A), if at any time
the mandatory prepayment of Term Loans pursuant to Sections 4.02(A)(e) through
(i) above would result, after giving effect to the procedures set forth above,
in the Borrower incurring breakage costs under Section 1.11 as a result of
Eurodollar Loans being prepaid other than on the last day of an Interest Period
applicable thereto (the "Affected Eurodollar Loans"), then the Borrower may in
its sole discretion initially deposit a portion (up to 100%) of the amounts that
otherwise would have been paid in respect of the Affected Eurodollar
-29-
Loans with the Administrative Agent (which deposit, after giving effect to
interest to be earned on such deposit prior to the last day of the relevant
Interest Periods, must be equal in amount to the amount of Affected Eurodollar
Loans not immediately prepaid) to be held as security for the obligations of the
Borrower hereunder pursuant to a cash collateral agreement to be entered into in
form and substance reasonably satisfactory to the Administrative Agent, with
such cash collateral to be directly applied upon the first occurrence (or
occurrences) thereafter of the last day of an Interest Period applicable to the
relevant Term Loans that are Eurodollar Loans (or such earlier date or dates as
shall be requested by the Borrower), to repay an aggregate principal amount of
such Term Loans equal to the Affected Eurodollar Loans not initially repaid
pursuant to this sentence. Notwithstanding anything to the contrary contained
in the immediately preceding sentence, all amounts deposited as cash collateral
pursuant to the immediately preceding sentence shall be held for the sole
benefit of the Banks whose Term Loans would otherwise have been immediately
repaid with the amounts deposited and upon the taking of any action by the
Administrative Agent or the Banks pursuant to the remedial provisions of Section
10, any amounts held as cash collateral pursuant to this Section 4.02(A)(k)
shall, subject to the requirements of applicable law, be immediately applied to
the relevant Term Loans. Following repayment of the relevant Loans, any
remaining cash collateral will be returned to the Borrower.
(B) WAIVER OF CERTAIN MANDATORY REPAYMENTS BY B AND C BANKS.
Notwithstanding anything to the contrary contained in this Section 4.02 or
anywhere in this Agreement (including, without limitation, in Section 13.12),
the Borrower shall have the option, in its sole discretion, to give the Banks
with outstanding B Term Loans (the "B Banks") and C Term Loans (the "C Banks")
the option to waive a mandatory repayment of such Loans pursuant to Section
4.02(A)(e), (f), (g) (h) and/or (i) (each such repayment, a "Waivable Mandatory
Repayment") upon the terms and provisions set forth in this Section 4.02(B). If
the Borrower elects to exercise the option referred to in the preceding
sentence, the Borrower shall give to the Administrative Agent written notice of
its intention to give the B Banks and the C Banks the right to waive a Waivable
Mandatory Repayment at least five Business Days prior to such repayment, which
notice the Administrative Agent shall promptly forward to all B Banks and C
Banks (indicating in such notice the amount of such repayment to be applied to
each such Bank's outstanding Term Loans under such facilities). The Borrower's
offer to permit such Banks to waive any such Waivable Mandatory Repayment may
apply to all or part of such repayment, PROVIDED that any offer to waive part of
such repayment must be made ratably to such Banks on the basis of their
outstanding B Term Loans and C Term Loans. In the event such B Bank or C Bank
desires to waive such Bank's right to receive any such Waivable Mandatory
Repayment in whole or in part, such Bank shall so advise the Administrative
Agent no later than the close of business two Business Days after the date of
such notice from the Administrative Agent, which notice shall also include the
amount such Bank desires to receive in respect of such repayment. If any Bank
does not reply to the Administrative Agent within the two Business Days, it will
be deemed not to have waived any part of such repayment. If any Bank does not
specify an amount it wishes to receive, it will be deemed to have accepted 100%
of the total payment. In the event that any such Bank waives all or part of such
right to receive any such Waivable Mandatory Repayment, the Administrative Agent
shall apply 100% of the amount so waived by such Bank to the A Term Loans in
accordance with Section 4.02(A)(j) and (k).
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4.03 METHOD AND PLACE OF PAYMENT. Except as otherwise specifically
provided herein, all payments under this Agreement or any Note shall be made to
the Administrative Agent for the account of the Bank or Banks entitled thereto
not later than 12:00 Noon (New York time) (or 1:00 p.m. (New York time) in the
case of Swingline Loans) on the date when due and shall be made in Dollars in
immediately available funds at the Payment Office of the Administrative Agent.
Whenever any payment to be made hereunder or under any Note shall be stated to
be due on a day which is not a Business Day, the due date thereof shall be
extended to the next succeeding Business Day and, with respect to payments of
principal, interest shall be payable at the applicable rate during such
extension.
4.04 NET PAYMENTS. (a) All payments made by the Borrower hereunder
or under any Note will be made without set-off, counterclaim or other defense.
Except as provided in Section 4.04(b), all such payments will be made free and
clear of, and without deduction or withholding for, any present or future taxes,
levies, imposts, duties, fees, assessments or other charges of whatever nature
now or hereafter imposed by any jurisdiction or by any political subdivision or
taxing authority thereof or therein with respect to such payments (but
excluding, except as provided in the second succeeding sentence, any tax imposed
on or measured by the net income or net profits of a Bank, or any franchise tax
based on the net income or net profits of a Bank, in either case pursuant to the
laws of the United States of America or the jurisdiction in which it is
organized or in which the principal office or applicable lending office of such
Bank is located or any subdivision thereof or therein) and all interest,
penalties or similar liabilities with respect to such non-excluded taxes,
levies, imposts, duties, fees, assessments or other charges (all such
non-excluded taxes, levies, imposts, duties, fees, assessments or other charges
being referred to collectively as "Taxes"). If any Taxes are so levied or
imposed, the Borrower agrees to pay the full amount of such Taxes, and such
additional amounts as may be necessary so that every payment of all amounts due
under this Agreement or under any Note, after withholding or deduction for or on
account of any Taxes, will not be less than the amount provided for herein or in
such Note. If any amounts are payable in respect of Taxes pursuant to the
preceding sentence of this Section 4.04(a), then the Borrower agrees to
reimburse each Bank, upon the written request of such Bank, for taxes imposed on
or measured by the net income or net profits of such Bank, or any franchise tax
based on the net income or net profits of such Bank, in either case pursuant to
the laws of the jurisdiction in which such Bank is organized or in which the
principal office or applicable lending office of such Bank is located or under
the laws of any political subdivision or taxing authority of any such
jurisdiction in which the principal office or applicable lending office of such
Bank is located and for any withholding of income or similar taxes as such Bank
shall determine are payable by, or withheld from, such Bank in respect of such
amounts so paid to or on behalf of such Bank pursuant to the preceding sentence
and in respect of any amounts paid to or on behalf of such Bank pursuant to this
sentence. The Borrower will furnish to the Administrative Agent within 45 days
after the date the payment of any Taxes is due pursuant to applicable law
certified copies of tax receipts evidencing such payment by the Borrower. The
Borrower agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Taxes that arise from the
failure of the Borrower to pay any Taxes when due to the appropriate Tax
authority and that become payable by the Administrative Agent or any Bank as a
result of any such failure.
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(b) Each Bank that is not a United States person (as such term is
defined in Section 7701(a)(30) of the Code) for U.S. Federal income tax purposes
agrees to deliver to the Borrower and the Administrative Agent on or prior to
the Initial Borrowing Date, or in the case of a Bank that is an assignee or
transferee of an interest under this Agreement pursuant to Sections 1.13 or
13.04 (unless the respective Bank was already a Bank hereunder immediately prior
to such assignment or transfer), on the date of such assignment or transfer to
such Bank, (i) (x) two accurate and complete original signed copies of Internal
Revenue Service Form 4224 or Form 1001 (or successor forms) certifying to such
Bank's entitlement to a complete exemption from United States withholding tax
with respect to payments to be made under this Agreement and under any Note (y)
an Internal Revenue Service Form W-8 or W-9, or successor applicable form, as
the case may be, and (z) obtain such extensions of time for filing and complete
such forms or certifications as may be reasonably requested by the Borrower or
the Administrative Agent, or (ii) if the Bank is not a "bank" within the meaning
of Section 881(c)(3)(A) of the Code and cannot deliver either Internal Revenue
Service Form 1001 or 4224 pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a "Section
4.04(b)(ii) Certificate") and (y) two accurate and complete original signed
copies of Internal Revenue Service Form W-8 (or successor form) certifying to
such Bank's entitlement to a complete exemption from United States withholding
tax with respect to payments of interest to be made under this Agreement and
under any Note. In addition, each Bank agrees that from time to time after the
Effective Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material respect, it will
deliver to the Borrower and the Administrative Agent two new accurate and
complete original signed copies of Internal Revenue Service Form 4224 or 1001
Form W-8 or Form W-9 and a Section 4.04(b)(ii) Certificate, as the case may be,
and such other forms as may be required in order to confirm or establish the
entitlement of such Bank to a continued exemption from or reduction in United
States withholding tax with respect to payments under this Agreement and any
Note, or it shall immediately notify the Borrower and the Administrative Agent
of its inability to deliver any such form or Certificate due to an event
(including without limitation, any change in treaty, law, or regulation) that
has occurred prior to the date on which any such delivery would be required
which renders all such forms inapplicable or would prevent such Bank from duly
completing and delivering such form with respect to it, in which case such Bank
shall not be required to deliver any such form or Certificate pursuant to this
Section 4.04(b). Notwithstanding anything to the contrary contained in Section
4.04(a), but subject to Section 13.04(b) and the immediately succeeding
sentence, (x) the Borrower shall be entitled, to the extent it is required to do
so by law, to deduct or withhold income or similar taxes imposed by the United
States (or any political subdivision or taxing authority thereof or therein)
from interest, fees or other amounts payable hereunder for the account of any
Bank which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for U.S. Federal income tax purposes to the extent that
such Bank has not provided to the Borrower U.S. Internal Revenue Service Forms
that establish a complete exemption from such deduction or withholding and (y)
the Borrower shall not be obligated pursuant to Section 4.04(a) hereof to
gross-up payments to be made to a Bank in respect of income or similar taxes
imposed by the United States if (I) such Bank has not provided to the Borrower
the Internal Revenue Service Forms that establish a complete exemption from
withholding of such Taxes pursuant to this Section 4.04(b) or (II) in the case
of a payment, other than interest, to a Bank described in clause (ii) above, to
the extent that such Forms do not
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establish a complete exemption from withholding of such taxes. Notwithstanding
anything to the contrary contained in the preceding sentence or elsewhere in
this Section 4.04 and except as set forth in Section 13.04(b) and subject to
Section 1.12, the Borrower agrees to pay additional amounts and to indemnify
each Bank in the manner set forth in Section 4.04(a) (without regard to the
identity of the jurisdiction requiring the deduction or withholding) in respect
of any amounts deducted or withheld by it as described in the immediately
preceding sentence as a result of any changes after the Effective Date in any
applicable law, treaty, governmental rule, regulation, guideline or order, or in
the interpretation thereof, relating to the deducting or withholding of income
or similar Taxes.
(c) The provisions of this Section 4.04 are subject to the provisions
of Section 13.15 (to the extent applicable).
(d) If the Borrower pays any additional amount under this Section
4.04 to a Bank and such Bank or any affiliate receives in connection therewith
any refund or reduction of, or credit against, its Tax liabilities (including,
any tax imposed on or measured by the net income or net profits of a Bank, or
any franchise tax based on net income or net profits of a Bank), such Bank shall
pay the Borrower an amount that is equal to the net benefit, after tax, that was
obtained by the Bank in the year or years that such benefit was received or
realized.
SECTION 5. CONDITIONS PRECEDENT TO CREDIT EVENTS ON THE INITIAL
BORROWING DATE. The obligation of each Bank to make Loans and to participate in
Letters of Credit, and the obligations of each Issuing Bank to issue Letters of
Credit, in each case on the Initial Borrowing Date is subject, at the time of
such Credit Event, to the satisfaction of the following conditions:
5.01 EXECUTION OF AGREEMENT; NOTES. On or prior to the Initial
Borrowing Date (i) the Effective Date shall have occurred and (ii) there shall
have been delivered to the Administrative Agent for the account of each of the
Banks the appropriate A Term Note, B Term Note, C Term Note and/or Revolving
Note executed by the Borrower and to the Swingline Bank, the Swingline Note
executed by the Borrower, in each case in the amount, maturity and as otherwise
provided herein.
5.02 FEES, ETC. On the Initial Borrowing Date, the Borrower shall
have paid to the Administrative Agent and the Banks all costs, fees and expenses
(including, without limitation, legal fees and expenses to the extent invoiced)
payable to the Administrative Agent and the Banks to the extent then due.
5.03 OPINIONS OF COUNSEL. On the Initial Borrowing Date, the
Administrative Agent shall have received (i) from Skadden, Arps, Slate, Xxxxxxx
& Xxxx LLP, special counsel to Holdings and its Subsidiaries, an opinion
addressed to the Administrative Agent and each of the Banks and dated the
Initial Borrowing Date covering the matters set forth in Exhibit E and (ii) from
local counsel satisfactory to the Administrative Agent, opinions each of which
shall be in form and substance reasonably satisfactory to the Administrative
Agent and the Required Banks and shall cover the perfection of the security
interests granted pursuant to the Security Agreement and the Mortgages and such
other matters incident to the transactions contemplated herein as the
Administrative Agent may reasonably request.
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5.04 CORPORATE DOCUMENTS; PROCEEDINGS; ETC. (a) On the Initial
Borrowing Date, the Administrative Agent shall have received a certificate,
dated the Initial Borrowing Date, signed by an Authorized Officer of each Credit
Party, and attested to by the Secretary or any Assistant Secretary of such
Credit Party, all in the form of Exhibit F with appropriate insertions, together
with copies of the Certificate of Incorporation and By-Laws of such Credit
Party, as the case may be, and the resolutions, or such other administrative
approval, of such Credit Party, as the case may be, referred to in such
certificate, and the foregoing shall be reasonably acceptable to the
Administrative Agent.
(b) On the Initial Borrowing Date, all corporate and legal
proceedings and all instruments and agreements in connection with the
transactions contemplated by this Agreement and the other Documents shall be
reasonably satisfactory in form and substance to the Administrative Agent and
the Required Banks, and the Administrative Agent shall have received all
information and copies of all documents and papers, including records of
corporate proceedings, governmental approvals, good standing certificates and
bring-down telegrams or facsimiles, if any, which the Administrative Agent
reasonably may have requested in connection therewith, such documents and papers
where appropriate to be certified by proper corporate or governmental
authorities.
5.05 SHAREHOLDERS' AGREEMENTS; MANAGEMENT AGREEMENTS; TAX SHARING
AGREEMENTS. On the Initial Borrowing Date, there shall have been delivered to
the Administrative Agent true and correct copies, certified as true and complete
by an Authorized Officer of Holdings or its respective Subsidiaries of (i) all
agreements (if any) entered into by Holdings or any of its Subsidiaries (after
giving effect to the Transaction) governing the terms and relative rights of its
capital stock and any agreements entered into by shareholders, relating to any
such entity with respect to its capital stock (collectively, the "Shareholders'
Agreements"), (ii) all agreements (if any) with senior members of, or with
respect to, the management of Holdings or any of its Subsidiaries (after giving
effect to the Transaction) (collectively, the "Management Agreements"), and
(iii) all agreements (if any) relating to the sharing of tax liabilities and
benefits among Holdings and/or its Subsidiaries (each a "Tax Sharing Agreement"
and collectively, the "Tax Sharing Agreements"); all of which Shareholders'
Agreements, Management Agreements and Tax Sharing Agreements, shall be in form
and substance reasonably satisfactory to the Administrative Agent and the
Required Banks and shall be in full force and effect on the Initial Borrowing
Date.
5.06 CONSUMMATION OF THE TRANSACTION. (a) On or prior to the
Initial Borrowing Date:
(i) Holdings shall have received gross cash proceeds in an
aggregate amount of at least $95,000,000 in connection with (i) the
purchase by AIPCF and other investors satisfactory to the Administrative
Agent of its common stock (the "Holdings Common Stock") and/or (ii) the
issuance of its zero-coupon indebtedness in an amount not to exceed
$30,000,000 (the "Holdings Debentures", and together with the Holdings
Common Stock, the "Holdings Financing"), all of which proceeds shall be
contributed to the capital of the Borrower and shall have been utilized to
make payments owing in connection with the Transaction before (or
simultaneously with) utilizing the proceeds of
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any Loans for such purpose. On or prior to the Initial Borrowing Date,
there shall have been delivered to the Administrative Agent true and
correct copies of all Holdings Financing Documents, each of which shall be
in full force and effect, and all of the terms and conditions thereof shall
be in form and substance reasonably satisfactory to the Administrative
Agent and the Required Banks. The issuance or incurrence of the Holdings
Financing shall have been consummated in accordance with the Holdings
Financing Documents and applicable law and none of the material provisions
of the Holdings Financing Documents shall have been amended, waived,
supplemented or otherwise modified without the prior written consent of the
Administrative Agent (which consent shall not be unreasonably withheld);
(ii) the Borrower shall have received gross cash proceeds in a
minimum aggregate principal amount equal to $175,000,000 from the issuance
by the Borrower of the Senior Subordinated Notes (the "Senior Subordinated
Note Issuance"), and the Borrower shall have utilized such amount to make
payments owing in connection with the Transaction before (or simultaneously
with) utilizing proceeds of any Loans for such purpose. On or prior to the
Initial Borrowing Date, there shall have been delivered to the
Administrative Agent true and correct copies of the Senior Subordinated
Note Documents, each of which shall be in full force and effect, and all of
the terms and conditions thereof shall be in form and substance reasonably
satisfactory to the Administrative Agent and the Required Banks. The Senior
Subordinated Note Issuance shall have been consummated in accordance with
the Senior Subordinated Note Documents and applicable law and none of the
material provisions of the Senior Subordinated Note Documents shall have
been amended, waived, supplemented or otherwise modified without the prior
written consent of the Administrative Agent (which consent shall not be
unreasonably withheld); and
(iii) on or prior to the Initial Borrowing Date (i) the Borrower
shall have consummated a tender offer/consent solicitation with respect to
the outstanding Senior Secured Notes (the "Senior Secured Notes Tender
Offer/Consent Solicitation"), pursuant to which (x) the Borrower shall
offer, subject to the terms and conditions contained in the Senior Secured
Notes Tender Offer/Consent Solicitation, to purchase all of the outstanding
Senior Secured Notes at the cash price set forth in the Senior Secured
Notes Tender Offer/Consent Solicitation and (y) consents shall be solicited
to a proposed amendment to the Senior Secured Notes Indenture, on terms and
conditions set forth in the Senior Secured Notes Tender Offer Consent
Solicitation, which amendment shall provide for the substantial elimination
of the financial and certain operating covenants contained in the Senior
Secured Notes Indenture (including, without limitation, limitations on the
incurrence of liens, transactions with affiliates and indebtedness) and the
amendment or elimination of certain other provisions in the Senior Secured
Notes Collateral Documents; (ii) the period for tendering Senior Secured
Notes pursuant thereto shall terminate on or prior to the Initial
Borrowing Date; (iii) the Borrower shall have received sufficient consents
to authorize the execution and delivery of the Senior Secured Notes
Indenture Supplement; (iv) the Borrower and the trustee under the Senior
Secured Notes Indenture shall have duly executed and delivered the Senior
Secured Notes Indenture Supplement (which shall include the Senior Secured
Notes Collateral
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Documents Amendment); (v) the Borrower shall have repurchased or committed
to repurchase the all of the Senior Secured Notes (which shall in no event
be less than $50,000,000 in aggregate principal amount), and not
theretofore withdrawn, pursuant to the Senior Secured Notes Tender
Offer/Consent Solicitation (the "Senior Secured Notes Tender Offer
Repurchases"); (vi) all security interests and Liens on the assets owned by
the Borrower arising in connection with the issuance of the Senior Secured
Notes shall have been terminated and the Administrative Agent shall have
received such releases of such security interests and Liens as may have
been reasonably requested by the Administrative Agent, which releases shall
be in form and substance reasonably satisfactory to the Administrative
Agent; and (vii) the Administrative Agent shall be reasonably satisfied
that the Senior Secured Notes Tender Offer/Consent Solicitation shall be
consummated in accordance with the Senior Secured Notes Tender Offer
Documents and all applicable laws on the Initial Borrowing Date (all of the
foregoing, the "Refinancing").
(b) On or prior to the Initial Borrowing Date, there shall have been
delivered to the Banks copies of all Merger Documents, all of which shall be
certified by an Authorized Officer of Holdings and/or its Subsidiaries as true
and correct and be in full force and effect and shall be in form and substance
reasonably satisfactory to the Administrative Agent and the Required Banks. On
the Initial Borrowing Date, the Merger shall have been consummated in accordance
with the Merger Documents and all applicable laws. All material conditions to
Holdings' obligations in the Merger Agreement and related material agreements
shall have been satisfied, without waiver or modification (except with the
consent of the Administrative Agent, which consent shall not be unreasonably
withheld).
(c) On or prior to the Initial Borrowing Date, all necessary and
material governmental (domestic and foreign) and third party approvals in
connection with the Transaction shall have become final, and the transactions
contemplated by the Credit Documents and otherwise referred to herein or
therein, shall have been obtained and remain in effect, and all applicable
waiting periods shall have expired without any action being taken by any
competent authority which restrains, prevents or imposes, in the reasonable
judgment of the Administrative Agent, materially adverse conditions upon the
consummation of the Transaction and the transactions contemplated by this
Agreement. Additionally, there shall not exist any judgment, order, injunction
or other restraint issued or filed or a hearing seeking injunctive relief or
other restraint pending or notified prohibiting or imposing materially adverse
conditions upon the consummation of the Transaction or the transactions
contemplated by this Agreement.
5.07 PLEDGE AGREEMENT. On the Initial Borrowing Date, Holdings and
the Borrower shall have duly authorized, executed and delivered a Pledge
Agreement in the form of Exhibit G with such changes thereto, or such additional
pledge agreements (or amendments thereto) entered into in connection therewith,
as foreign counsel may suggest in connection with the Pledged Securities issued
by any Foreign Subsidiary of the Borrower designated by the Administrative Agent
(such Pledge Agreement, together with such additional pledge agreements, as
amended, modified, extended, renewed, replaced, restated or supplemented from
time to time, the "Pledge Agreement") and shall have delivered to the Collateral
Agent, as Pledgee, all the Pledged Securities referred to therein then owned by
such Credit Party, together with executed
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and undated stock powers, in the case of capital stock constituting Pledged
Securities, PROVIDED, that no more than 65% of the capital stock of Copetro S.A.
("Copetro") or any other Foreign Subsidiary shall be pledged pursuant to the
Pledge Agreement.
5.08 SECURITY AGREEMENT. On the Initial Borrowing Date, Holdings and
the Borrower shall have duly authorized, executed and delivered a Security
Agreement in the form of Exhibit H (as amended, modified, extended, renewed,
replaced, restated or supplemented from time to time, the "Security Agreement")
covering all of Holdings' and the Borrower's present and future Security
Agreement Collateral, together with:
(a) proper Financing Statements (Form UCC-1) fully executed for
filing under the UCC or other appropriate filing offices of each
jurisdiction as may be necessary or, in the reasonable opinion of the
Collateral Agent, desirable to perfect the security interests purported to
be created by the Security Agreement;
(b) certified copies of Requests for Information or Copies (Form
UCC-11), or equivalent reports, listing all effective financing statements
that name the Borrower as debtor and that are filed in the jurisdictions
referred to in clause (a) above, together with copies of such other
financing statements (none of which shall cover the Collateral except to
the extent evidencing Permitted Liens or in respect of which the Collateral
Agent shall have received termination statements (Form UCC-3) or such other
termination statements as shall be required by local law) fully executed
for filing;
(c) evidence of the completion of all other recordings and filings
of, or with respect to, the Security Agreement as may be necessary or, in
the reasonable opinion of the Collateral Agent, desirable to perfect the
security interests intended to be created by the Security Agreement; and
(d) evidence that all other actions necessary or, in the reasonable
opinion of the Collateral Agent, desirable to perfect and protect the
security interests purported to be created by the Security Agreement have
been taken.
5.09 MORTGAGES; TITLE INSURANCE; ETC. On the Initial Borrowing Date,
the Collateral Agent shall have received:
(a) duly authorized, fully executed, acknowledged, and delivered
deeds of trust, mortgages, leasehold deeds of trust or leasehold mortgages
substantially in the form of Exhibit I (as amended, modified, extended,
renewed, replaced, restated or supplemented from time to time, each a
"Mortgage" and collectively, the "Mortgages"), which Mortgages shall cover
such of the Real Property owned or leased by Holdings and/or its
Subsidiaries as shall be designated as such on Schedule III as a mortgaged
property thereunder (each, a "Mortgaged Property" and collectively, the
"Mortgaged Properties"), together with evidence that counterparts of the
Mortgages have been delivered to the title insurance company insuring the
Lien of the Mortgages for recording in all places to the extent necessary
or, in the reasonable opinion of the Collateral Agent, desirable to
effectively create a valid and enforceable Lien on each Mortgaged Property
in favor of the
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Collateral Agent (or such other trustee as may be required or desired under
local law) for the benefit of the Secured Creditors;
(b) duly authorized, fully executed, acknowledged, and delivered
subordination, nondisturbance and attornment agreements, assignments of
leases, landlord consents, tenant estoppel certificates, and such other
documents relating to the Mortgages that the Collateral Agent may
reasonably request; and
(c) Extended coverage policies of mortgage title insurance covering
each Mortgaged Property, together with all endorsements reasonably
requested by the Collateral Agent relating thereto issued by title insurers
reasonably satisfactory to the Collateral Agent (the "Mortgage Policies")
in amounts reasonably satisfactory to the Administrative Agent and the
Required Banks (but not in excess of the value of the respective Mortgaged
Property) assuring the Collateral Agent that the Mortgages on such
Mortgaged Properties are valid and enforceable first priority mortgage
liens on the respective Mortgaged Properties, free and clear of all defects
and encumbrances except Permitted Encumbrances and such Mortgage Policies
shall otherwise be in form and substance reasonably satisfactory to the
Administrative Agent and the Required Banks and shall include, as
appropriate and to the extent available, an endorsement for future advances
under this Agreement and the Notes and for any other matter that the
Collateral Agent in its reasonable discretion may reasonably request, shall
not include an exception for mechanics' liens, and shall provide for
affirmative insurance (to the extent available) and such reinsurance as the
Collateral Agent in its discretion may reasonably request.
5.10 ADVERSE CHANGE, ETC. On the Initial Borrowing Date, after
giving effect to the Transaction, nothing shall have occurred since December 31,
1997 which could reasonably be likely to have a material adverse effect on the
rights or remedies of the Administrative Agent or the Banks, or on the ability
of the Credit Parties to perform their respective obligations to the
Administrative Agent and the Banks or which could reasonably be likely to have a
Material Adverse Effect.
5.11 SOLVENCY LETTER; INSURANCE. On or before the Initial Borrowing
Date, the Borrower shall have delivered or shall cause to be delivered to the
Administrative Agent (i) a solvency letter in form and substance reasonably
satisfactory to the Administrative Agent from Valuation Research Corporation,
setting forth its conclusions that, after giving effect to the Transaction, each
of Holdings and its Subsidiaries taken as a whole, and the Borrower and its
Subsidiaries, taken as a whole, is not insolvent and will not be rendered
insolvent by the indebtedness incurred in connection therewith, and will not be
left with unreasonably small capital with which to engage in their business and
will not have incurred debts beyond their ability to pay debts as they mature,
and (ii) evidence of insurance complying with the requirements of Section 8.03
for the business and properties of Holdings and its Subsidiaries, in scope, form
and substance reasonably satisfactory to the Administrative Agent and the
Required Banks and naming the Collateral Agent as an additional insured and/or
loss payee, and stating that such insurance shall not be canceled or revised
without 30 days' prior written notice by the insurer to the Collateral Agent.
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5.12 PRO FORMA BALANCE SHEET; PROJECTIONS. (a) On the Initial
Borrowing Date, the Banks shall have received the unaudited projected PRO FORMA
consolidated balance sheets of Holdings and the Borrower prepared on a
consolidated basis based upon the projected balance sheet at the Initial
Borrowing Date prepared on a basis consistent with the Projections and in
accordance with the financial statement delivered pursuant to Section 7.05(a),
both immediately before and immediately after giving effect to the Transaction,
the related financing thereof and the other transactions contemplated hereby and
thereby, which projected PRO FORMA consolidated balance sheets shall be in form
and substance reasonably satisfactory to the Administrative Agent and the
Required Banks.
(b) On the Initial Borrowing Date, the Banks shall have received the
Projections described in Section 7.05(d), which Projections shall be in form and
substance reasonably satisfactory to the Administrative Agent and the Required
Banks.
SECTION 6. CONDITIONS PRECEDENT TO ALL CREDIT EVENTS. The obligation
of each Bank to make Loans and participate in Letters of Credit (including Loans
made and Letters of Credit issued on the Initial Borrowing Date), and the
obligation of any Issuing Bank to issue any Letter of Credit (including any
Letter of Credit issued on the Initial Borrowing Date), is subject, at the time
of each such Credit Event (except as hereinafter indicated), to the satisfaction
of the following conditions:
6.01 NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time of each
such Credit Event and also after giving effect thereto (i) there shall exist no
Default or Event of Default and (ii) all representations and warranties
contained herein or in any other Credit Document shall be true and correct in
all material respects with the same effect as though such representations and
warranties had been made on the date of the making of such Credit Event (it
being understood and agreed that any representation or warranty which by its
terms is made as of a specified date shall be required to be true and correct in
all material respects only as of such specified date).
6.02 NOTICE OF BORROWING; LETTER OF CREDIT REQUEST. (a) Prior to
the making of each Loan (other than a Swingline Loan or a Mandatory Borrowing),
the Administrative Agent shall have received the notice required by Section
1.03(a). Prior to the making of each Swingline Loan, the Swingline Bank shall
have received the notice referred to in Section 1.03(b).
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the respective Issuing Bank shall have received a
Letter of Credit Request meeting the requirements of Section 2.02.
The acceptance of the benefit of each Credit Event shall constitute a
representation and warranty by Holdings and the Borrower to the Administrative
Agent and each of the Banks that all the conditions specified in Section 5 and
in this Section 6 and applicable to such Credit Event exist as of that time
(except to the extent that any of the conditions specified in Section 5 are
required to be satisfactory to or determined by any Bank, the Required Banks
and/or the Administrative Agent). All of the Notes, certificates, legal
opinions and other documents and papers referred to in Section 5 and in this
Section 6, unless otherwise specified, shall be delivered to the Administrative
Agent at the Notice Office or to counsel for the Administrative Agent for
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the account of each of the Banks and, except for the Notes, in sufficient
counterparts or copies for each of the Banks.
SECTION 7. REPRESENTATIONS, WARRANTIES AND AGREEMENTS. In order to
induce the Banks to enter into this Agreement and to make the Loans, and issue
(or participate in) the Letters of Credit as provided herein, each of Holdings
and the Borrower makes the following representations, warranties and agreements,
in each case after giving effect to the Transaction consummated on the Initial
Borrowing Date, all of which shall survive the execution and delivery of this
Agreement and the Notes and the making of the Loans and the issuance of the
Letters of Credit, with the occurrence of each Credit Event on or after the
Initial Borrowing Date being deemed to constitute a representation and warranty
that the matters specified in this Section 7 are true and correct on and as of
the Initial Borrowing Date in all material respects and in all material respects
on the date of each such Credit Event (it being understood and agreed that any
representation or warranty which by its terms is made as of a specified date
shall be required to be true and correct in all material respects only as of
such specified date).
7.01 CORPORATE STATUS. Holdings, the Borrower and each of their
respective Subsidiaries (i) is a duly organized and validly existing corporation
in good standing under the laws of the jurisdiction of its organization, (ii)
has the corporate power and authority to own its property and assets and to
transact the business in which it is engaged and presently proposes to engage
and (iii) is duly qualified to do business and is in good standing in each
jurisdiction where the conduct of its business requires such qualifications
except for failures to be so qualified which, individually or in the aggregate,
could not reasonably be expected to have a Material Adverse Effect.
7.02 CORPORATE POWER AND AUTHORITY. Each Credit Party has the
corporate power and authority to execute, deliver and perform the terms and
provisions of each of the Documents to which it is party and has taken all
necessary corporate action, as the case may be, to authorize the execution,
delivery and performance by it of each of such Documents. Each Credit Party has
duly executed and delivered each of the Documents to which it is party, and each
of such Documents constitutes such Credit Party's legal, valid and binding
obligation enforceable in accordance with its terms, except to the extent that
the enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors'
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law).
7.03 NO VIOLATION. Neither the execution, delivery or performance by
any Credit Party of the Documents to which it is a party, nor compliance by it
with the terms and provisions thereof, (i) will contravene any material
provision of any applicable law, statute, rule or regulation or any applicable
order, writ, injunction or decree of any court or governmental instrumentality,
(ii) will conflict with or result in any breach of any of the material terms,
covenants, conditions or provisions of, or constitute a default under, or result
in the creation or imposition of (or the obligation to create or impose) any
Lien (except pursuant to the Security Documents) upon any of the material
properties or assets of Holdings, the Borrower or any of their respective
Subsidiaries pursuant to the terms of any material indenture, mortgage, deed of
trust, credit agreement or loan agreement, or any other material agreement,
contract or instrument, to which Holdings, the
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Borrower or any of their respective Subsidiaries is a party or by which it or
any of its property or assets is bound or to which it may be subject or (iii)
will violate any provision of the Certificate of Incorporation or By-Laws of
Holdings or any of its Subsidiaries.
7.04 GOVERNMENTAL APPROVALS. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration with
(except as have been obtained or made prior to the Initial Borrowing Date), or
exemption by, any governmental or public body or authority, or any subdivision
thereof, is required to authorize, or is required in connection with, (i) the
execution, delivery and performance of any Document or (ii) the legality,
validity, binding effect or enforceability of any such Document, except, in the
case of any failure to obtain, where such failure to so obtain would not have a
(x) Material Adverse Effect or (y) a material adverse effect on the ability of
the Credit Parties to perform their obligations under the Credit Documents or
the rights and remedies of the Administrative Agent and the Banks thereunder.
7.05 FINANCIAL STATEMENTS; FINANCIAL CONDITION; UNDISCLOSED
LIABILITIES; PROJECTIONS; ETC. (a) The balance sheets, statements of
operations, statements of stockholders' equity, statements of changes in
stockholders' equity, statements of changes in group deficiency, statements of
operations and division equity, statements of assets and liabilities, statements
of operating revenues and expenses, statements of charges in net assets,
statements of changes in group investment (deficiency) and statements of cash
flows of the Borrower and its Subsidiaries as furnished to the Banks prior to
the Effective Date fairly present the financial condition and operations of the
Borrower and its Subsidiaries at and for the periods indicated. All such
financial statements are true and correct in all material respects and have been
prepared in accordance with GAAP, consistently applied. After giving effect to
the Transaction, since December 31, 1997, there has been no material adverse
change in the business, operations, property, assets, liabilities, condition
(financial or otherwise) or prospects of the Borrower or of Holdings and its
Subsidiaries taken as a whole.
(b) (i) On and as of the Initial Borrowing Date, after giving effect
to the Transaction and to all Indebtedness incurred, and to be incurred, and
Liens created, and to be created, by Holdings and its Subsidiaries in connection
therewith, (a) the sum of the assets, at a fair valuation, of Holdings and its
Subsidiaries will exceed their debts; (b) Holdings and its Subsidiaries taken as
a whole have not incurred and do not intend to incur, and do not believe that
they will incur, debts beyond their ability to pay such debts as such debts
mature; and (c) Holdings and its Subsidiaries taken as a whole will have
sufficient capital with which to conduct their businesses. For purposes of this
Section 7.05(b), "debt" means any liability on a claim, and "claim" means (i)
right to payment, whether or not such a right is reduced to judgment,
liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,
undisputed, legal, equitable, secured, or unsecured or (ii) right to an
equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured.
(c) Except as fully disclosed in the financial statements delivered
pursuant to Section 7.05(a) or the offering circular relating to the Senior
Subordinated Note Issuance, there were as of the Initial Borrowing Date no
liabilities or obligations with respect to Holdings or any
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of its Subsidiaries of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether or not due) which, either individually or in
aggregate, would be material to the Borrower or to Holdings and its Subsidiaries
taken as a whole (except that amount of indebtedness described in such financial
statements has increased to $88,400,000 as of March 31, 1998). As of the
Initial Borrowing Date, neither Holdings nor the Borrower knows of any basis for
the assertion against it of any liability or obligation of any nature whatsoever
that is not fully disclosed in the financial statements delivered pursuant to
Section 7.05(a) or the offering circular relating to the Senior Subordinated
Note Issuance which, either individually or in the aggregate, would reasonably
be expected to have a Material Adverse Effect.
(d) On and as of the Initial Borrowing Date, the financial
projections dated as of May 11, 1998 (the "Projections") previously delivered to
the Administrative Agent and the Banks have been prepared on a basis consistent
with the financial statements referred to in Section 7.05(a) (other than as set
forth or presented in such Projections), and there are no statements or
conclusions in any of the Projections which are based upon or include
information known to the Borrower to be misleading in any material respect or
which fail to take into account material information regarding the matters
reported therein. On the Initial Borrowing Date, the Borrower believed that the
Projections were reasonable and attainable.
7.06 LITIGATION. There are no actions, suits or proceedings pending
or, to the best knowledge of Holdings and the Borrower, threatened (i) with
respect to any Document or (ii) that could reasonably be expected to have a
Material Adverse Effect.
7.07 TRUE AND COMPLETE DISCLOSURE. All factual information (taken as
a whole) furnished by or on behalf of Holdings or the Borrower in writing to the
Administrative Agent or any Bank for purposes of or in connection with this
Agreement, the other Credit Documents or any transaction contemplated herein or
therein is, and all other such factual information (taken as a whole) hereafter
furnished by or on behalf of the Borrower in writing to the Administrative Agent
or any Bank will be, true and accurate in all material respects on the date as
of which such information is dated or certified and not incomplete by omitting
to state any fact necessary to make such information (taken as a whole) not
misleading in any material respect at such time in light of the circumstances
under which such information was provided.
7.08 USE OF PROCEEDS; MARGIN REGULATIONS. (a) All proceeds of the
Term Loans shall be utilized by the Borrower (i) to effect the Transaction and
(ii) to pay fees and expenses related to the Transaction.
(b) Proceeds of Revolving Loans and Swingline Loans may be utilized
for the Borrower's and its Subsidiaries' general corporate and working capital
purposes and to make payments required in connection with the Transaction
following the Initial Borrowing Date PROVIDED, that up to $5,000,000 of
Revolving Loans and Letters of Credit may be utilized by the Borrower (i) to
effect the Transaction and (ii) to pay fees and expenses related to the
Transaction.
(c) No part of the proceeds of any Loan will be used to purchase or
carry any Margin Stock or to extend credit for the purpose of purchasing or
carrying any Margin Stock. Neither the making of any Loan nor the use of the
proceeds thereof will violate or be inconsistent
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with the provisions of Regulation T, U or X of the Board of Governors of the
Federal Reserve System.
7.09 TAX RETURNS AND PAYMENTS. Each of Holdings, the Borrower and
each of their Subsidiaries have timely filed or caused to be timely filed, on
the due dates thereof or within applicable grace periods, with the appropriate
taxing authority, all Federal and all material state returns, statements, forms
and reports for taxes (the "Returns") required to be filed by or with respect to
the income, properties or operations of Holdings and/or any of its Subsidiaries.
The Returns accurately reflect in all material respects all liability for taxes
of Holdings, the Borrower and their respective Subsidiaries, as the case may be,
for the periods covered thereby. Each of Holdings, the Borrower and their
respective Subsidiaries have paid all material taxes payable by them other than
taxes which are not delinquent or are being contested in good faith and for
which adequate reserves have been established in accordance with GAAP. Except
as disclosed in the financial statements referred to in Section 7.05(a), there
is no material action, suit, proceeding, investigation, audit, or claim now
pending or, to the best knowledge of Holdings or the Borrower, threatened by any
authority regarding any taxes relating to Holdings, the Borrower or any of their
respective Subsidiaries. As of the Initial Borrowing Date, except as set forth
in Schedule II, none of Holdings, the Borrower nor any of their respective
Subsidiaries has entered into an agreement or waiver or been requested to enter
into an agreement or waiver extending any statute of limitations relating to the
payment or collection of taxes of Holdings, the Borrower or any of their
respective Subsidiaries, or is aware of any circumstances that would cause the
taxable years or other taxable periods of Holdings, the Borrower or any of their
respective Subsidiaries not to be subject to the normally applicable statute of
limitations. None of Holdings, the Borrower nor any of their respective
Subsidiaries has incurred, or will incur, any material tax liability in
connection with the Transaction and the other transactions contemplated hereby.
7.10 COMPLIANCE WITH ERISA. Each Plan is in substantial compliance
with ERISA and the Code; no Reportable Event has occurred with respect to a
Plan; no Plan is insolvent or in reorganization; no Plan has a material Unfunded
Current Liability; no Plan has an accumulated or waived funding deficiency, has
permitted decreases in its funding standard account or has applied for an
extension of any amortization period within the meaning of Section 412 of the
Code; all contributions required to be made with respect to a Plan have been
timely made; none of Holdings, the Borrower nor any of their respective
Subsidiaries nor any ERISA Affiliate has incurred any material liability to or
on account of a Plan pursuant to Section 409, 502(i), 502(1), 515, 4062, 4063,
4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971, 4975 or
4980 of the Code or reasonably expects to incur any material liability under any
of the foregoing Sections with respect to any Plan; no proceedings have been
instituted to terminate or appoint a trustee to administer any Plan; no
condition exists which presents a material risk to Holdings, the Borrower or any
of their respective Subsidiaries or any ERISA Affiliate of incurring a material
liability to or on account of a Plan pursuant to the foregoing provisions of
ERISA and the Code; using actuarial assumptions and computation methods
consistent with Part 1 of subtitle E of Title IV of ERISA, the aggregate
liabilities of Holdings, the Borrower, their respective Subsidiaries and their
ERISA Affiliates to all Plans which are multiemployer plans (as defined in
Section 4001(a)(3) of ERISA) in the event of a complete withdrawal therefrom, as
of the close of the most recent fiscal year of each such Plan ended prior to the
date of the most recent Credit Event, would not exceed $5,000,000; no lien
imposed under
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the Code or ERISA on the assets of Holdings, the Borrower or any of their
respective Subsidiaries or any ERISA Affiliate exists or is reasonably likely to
arise on account of any Plan; and Holdings, the Borrower and their respective
Subsidiaries do not maintain or contribute to any employee welfare benefit plan
(as defined in Section 3(1) of ERISA) which provides benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA) or any employee pension benefit plan (as defined in Section 3(2) of
ERISA) the obligations with respect to which could reasonably be expected to
have a Material Adverse Effect.
7.11 THE SECURITY DOCUMENTS. (a) The provisions of the Security
Agreement are effective to create in favor of the Collateral Agent for the
benefit of the Secured Creditors a legal, valid and enforceable security
interest in all right, title and interest of the Credit Parties in the Security
Agreement Collateral described therein, and the Security Agreement, upon the
filing of Form UCC-1 financing statements or the appropriate equivalent (which
filing, if this representation is being made more than 10 days after Initial
Borrowing Date, has been made), create a fully perfected lien on, and security
interest in, all right, title and interest in all of the Security Agreement
Collateral described therein which is capable of being perfected with such
filings , subject to no other Liens other than Permitted Liens and Liens to be
released in connection with the Transaction.
(b) The security interests created in favor of the Collateral Agent,
as Pledgee, for the benefit of the Secured Creditors under the Pledge Agreement
constitute first priority perfected security interests in the Pledged Securities
described in the Pledge Agreement, subject to no security interests of any other
Person. No filings or recordings are required in order to perfect (or maintain
the perfection or priority of) the security interests created in the Pledged
Securities and the proceeds thereof under the Pledge Agreement, so long as the
Collateral Agent maintains possession of such Pledged Securities consisting of
certificated securities in the State of New York.
(c) The Mortgages create, as security for the obligations purported
to be secured thereby, a valid and enforceable perfected security interest in
and mortgage lien on all of the Mortgaged Properties in favor of the Collateral
Agent (or such other trustee as may be required or desired under local law) for
the benefit of the Secured Creditors, superior to and prior to the rights of all
third persons (except that the security interest and mortgage lien created in
the Mortgaged Properties may be subject to the Permitted Encumbrances, Permitted
Liens and Liens to be released in connection with the Transaction related
thereto) and subject to no other Liens (other than Liens permitted under Section
9.01). Schedule III contains a true and complete list of each parcel of Real
Property owned or leased by Holdings, the Borrower and their respective
Subsidiaries on the Effective Date, and the type of interest therein held by
Holdings, the Borrower or such Subsidiary.
7.12 REPRESENTATIONS AND WARRANTIES IN DOCUMENTS. All
representations and warranties set forth in the other Documents were true and
correct in all material respects at the time as of which such representations
and warranties were made (or deemed made).
7.13 PROPERTIES. Holdings, the Borrower and each of their respective
Subsidiaries have good and valid title to all properties (or a valid leasehold
estate with respect to leased
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properties) owned by them after giving effect to the Transaction in accordance
with the Transaction Documents, including all property reflected in the balance
sheet of the Borrower referred to in Section 7.05(a) and in the pro forma
balance sheet referred to in Section 5.12 (except for property sold or otherwise
disposed of since the date of such balance sheet in the ordinary course of
business or as otherwise permitted by this Agreement), free and clear of all
Liens, other than (i) as referred to in the balance sheet or in the notes
thereto or in such pro forma balance sheet or (ii) Permitted Liens.
7.14 CAPITALIZATION. On the Initial Borrowing Date and after giving
effect to the Transaction and the other transactions contemplated hereby, the
authorized capital stock of the Borrower shall consist of 1000 shares, $0.01 par
value per share, all of which shares are outstanding. All such outstanding
shares of common stock have been duly and validly issued, are fully paid and
nonassessable, are free of preemptive rights. As of the Initial Borrowing Date,
neither the Borrower nor its Subsidiaries has outstanding any securities
convertible into or exchangeable for its capital stock or outstanding any rights
to subscribe for or to purchase, or any options for the purchase of, or any
agreements providing for the issuance (contingent or otherwise) of, or any
calls, commitments or claims of any character relating to, its capital stock.
7.15 SUBSIDIARIES. After giving effect to the Transaction, as of the
Effective Date, Holdings will have no direct or indirect Subsidiaries other than
the Borrower and its Subsidiaries.
7.16 COMPLIANCE WITH STATUTES, ETC. Each of Holdings and its
Subsidiaries is in compliance with all applicable statutes, regulations and
orders of, and all applicable restrictions imposed by, all governmental bodies,
domestic or foreign, in respect of the conduct of its business and the ownership
of its property, except such noncompliances as could not individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
7.17 INVESTMENT COMPANY ACT. None of Holdings, the Borrower nor any
of their respective Subsidiaries is an "investment company" or a company
"controlled" by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
7.18 PUBLIC UTILITY HOLDING COMPANY ACT. None of Holdings, the
Borrower nor any of their respective Subsidiaries is a "holding company," or a
"subsidiary company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company" within the meaning
of the Public Utility Holding Company Act of 1935, as amended.
7.19 LABOR RELATIONS. None of Holdings, the Borrower nor any of
their respective Subsidiaries is engaged in any unfair labor practice that could
reasonably be expected to have a Material Adverse Effect. There is (i) no
unfair labor practice complaint pending against Holdings or any of its
Subsidiaries or, to the best knowledge of Holdings or the Borrower, threatened
against any of them, before the National Labor Relations Board, and no
significant grievance or significant arbitration proceeding arising out of or
under any collective bargaining agreement is so pending against Holdings or any
of its Subsidiaries or, to the best knowledge of Holdings or the Borrower,
threatened against any of them, (ii) no strike, labor dispute, slowdown or
stoppage pending against Holdings or any of its Subsidiaries or, to the best
knowledge of Holdings and the
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Borrower, threatened against Holdings or any of its Subsidiaries and (iii) to
the best knowledge of Holdings and the Borrower, no union representation
question existing with respect to the employees of Holdings or any of its
Subsidiaries, except (with respect to any matter specified in clause (i), (ii)
or (iii) above, either individually or in the aggregate) such as could not
reasonably be expected to have a Material Adverse Effect.
7.20 PATENTS, LICENSES, FRANCHISES AND FORMULAS. Each of Holdings
and its Subsidiaries owns all material patents, trademarks, permits, service
marks, trade names, copyrights, licenses, franchises and formulas, or rights
with respect to the foregoing, and has obtained assignments of all leases and
other rights of whatever nature, necessary for the present conduct of its
business, without any known conflict with the rights of others which, or the
failure to obtain which, as the case may be, could reasonably be likely to have
a Material Adverse Effect.
7.21 TRANSACTION. As of the Initial Borrowing Date, the Transaction
has been consummated in all material respects in accordance with the terms of
the respective Transaction Documents and all applicable laws. As of the Initial
Borrowing Date, all consents and approvals of, and filings and registrations
with, and all other actions in respect of, all governmental agencies,
authorities or instrumentalities required in order to make or consummate the
Transaction will have been obtained, given, filed or taken and are or will be in
full force and effect (or effective judicial relief with respect thereto has
been obtained), except where the failure to so obtain, give, file or take would
not have a Material Adverse Effect. All applicable waiting periods with respect
thereto have or, prior to the time when required, will have, expired without, in
all such cases, any action being taken by any competent authority which
restrains, prevents, or imposes material adverse conditions upon the
Transaction. Additionally, there does not exist any judgment, order or
injunction prohibiting or imposing material adverse conditions upon the
Transaction, or any Credit Event or the performance by any Credit Party of its
obligations under the respective Documents. All actions taken by each Credit
Party pursuant to or in furtherance of the Transaction have been taken in
material compliance with the respective Documents and all applicable laws.
7.22 SPECIAL PURPOSE CORPORATION. As of the Initial Borrowing Date,
Holdings has no material assets other than the capital stock of the Borrower
owned by Holdings. As of the Initial Borrowing Date, Holdings has engaged in no
activities except activities undertaken in connection with the Transaction and
has no material liabilities other than liabilities incurred in connection with
the Transaction.
7.23 SENIOR SUBORDINATED NOTES AND HOLDINGS DEBENTURES. As of the
Initial Borrowing Date, (i) the Senior Subordinated Notes have been duly
authorized, issued and delivered in accordance with applicable law and the
Senior Subordinated Note Documents, and (ii) the Holdings Debentures have been
duly authorized, issued and delivered in accordance with applicable law and the
Holdings Debenture Documents. The subordination provisions contained in the
Senior Subordinated Notes and the Holdings Debentures are enforceable by the
Banks against Holdings or the Borrower, as the case may be except to the extent
that the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws generally affecting
creditors' rights and by equitable principles (regardless of whether enforcement
is sought in equity or at law), and the holders of such Senior Subordinated
Notes or
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Xxxxxxxx Xxxxxxxxxx, as the case may be, and all Obligations of Holdings and/or
the Borrower hereunder or under the other Credit Documents are or will be within
the definition of "Senior Indebtedness" included in such provisions of the
Senior Subordinated Note Documents and the Holdings Debenture Documents.
SECTION 8. AFFIRMATIVE COVENANTS. Holdings and the Borrower hereby
covenant and agree that on and after the Effective Date and until the Total
Commitments and all Letters of Credit have terminated and the Loans, Notes and
Unpaid Drawings, together with interest, Fees and all other Obligations incurred
hereunder and thereunder, are paid in full:
8.01 INFORMATION COVENANTS. Holdings and/or the Borrower will
furnish to each Bank:
(a) MONTHLY REPORTS. Within 30 days after the end of each fiscal
month (other than the fiscal months ending March, June, September and December)
of Holdings (from and after July, 1998), the combined balance sheets of Holdings
and its Consolidated Subsidiaries as of the end of such month and the related
combined statements of income and statements of cash flows for such month and
for the last elapsed portion of the fiscal year ended with the last day of such
month, in each case setting forth in the statements of income only, the
comparative figures for the corresponding month in the prior fiscal year and the
budgeted figures for such month as set forth in the respective budget delivered
pursuant to Section 8.01(e).
(b) QUARTERLY FINANCIAL STATEMENTS. As soon as available and in any
event within 45 days after the close of each of the first three quarterly
accounting periods in each fiscal year of Holdings (from and after the fiscal
quarter ended in September 1998), the combined balance sheets of Holdings and
its Consolidated Subsidiaries as of the end of such quarter and the related
combined statements of income and statements of cash flows for such quarter and
for the last elapsed portion of the fiscal year ended with the last day of such
quarter and setting forth in the statements of income only, the comparative
figures for the corresponding quarter in the prior fiscal year and the budgeted
figures for such quarter as set forth in the respective budget delivered
pursuant to Section 8.01(e), (ii) the balance sheets of each of Holdings'
Subsidiaries as of the end of such quarter and the related statements of income
and statements of cash flows for such quarter and for the elapsed portion of the
fiscal year ended with the last day of such quarter, in each case setting forth
in the statements of income only, the comparative figures for the corresponding
quarter in the prior fiscal year and the budgeted figures for such quarter as
set forth in the respective budget delivered pursuant to Section 8.01(e), and
(iii) management's discussion and analysis of the important operational and
financial developments during such quarterly period in respect of Holdings and
its Subsidiaries.
(c) ANNUAL FINANCIAL STATEMENTS. Within 95 days after the close of
each fiscal year (after and including fiscal year 1998) of Holdings, the
consolidated balance sheets of Holdings and its Consolidated Subsidiaries as at
the end of such fiscal year and the related statements of income and retained
earnings and of cash flows for such fiscal year and, setting forth comparative
figures for the preceding fiscal year commencing fiscal year 1998 and certified,
in the case of such consolidated statements, by Ernst & Young LLP or such other
independent certified public accountants of recognized national standing
reasonably acceptable to the Administrative Agent,
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together with a report of such accounting firm (which report shall be
unqualified as to scope) stating that in the course of its regular audit of the
financial statements of Holdings and its Subsidiaries, which audit was conducted
in accordance with generally accepted auditing standards, such accounting firm
obtained no knowledge of any Default or Event of Default under Sections 9.03,
9.04, 9.05 and 9.07 through 9.09, inclusive, which has occurred and is
continuing or, if in the opinion of such accounting firm such a Default or Event
of Default has occurred and is continuing, a statement as to the nature thereof,
(ii) the balance sheets of each of Holdings' Subsidiaries at the end of such
fiscal year and the related statement of income and retained earnings and
statement of cash flows for such fiscal year, in each case setting forth
comparative figures for the preceding fiscal year, and (iii) management's
discussions and analysis of the important operational and financial developments
during such fiscal year in respect of Holdings and its Subsidiaries.
(d) MANAGEMENT LETTERS. Promptly after the receipt thereof by
Holdings or any of its Subsidiaries, a copy of any final "management letter"
received by Holdings or such Subsidiary from its certified public accountants
and management's responses thereto.
(e) BUDGETS. No later than 30 days following the commencement of the
first day of each fiscal year of Holdings, a budget in form satisfactory to the
Administrative Agent prepared by Holdings for (x) in the case of budgeted
statements of income, each of the twelve months of such fiscal year prepared in
detail, and (y) in the case of budgeted statements of sources and uses of cash
and balance sheets, for such fiscal year on an annual basis and prepared in
detail and for each of the five years immediately following such fiscal year
prepared in summary form, accompanied by the statement of the President, Chief
Financial Officer or Senior Vice President of Finance of the Borrower to the
effect that, to the best of his knowledge, the budget is a reasonable estimate
for the period covered thereby.
(f) OFFICER'S CERTIFICATES. At the time of the delivery of the
financial statements provided for in Section 8.01(a), (b) and (c), a certificate
of the Authorized Officer of the Borrower to the effect that, to the best of
such officer's knowledge, no Default or Event of Default has occurred and is
continuing or, if any Default or Event of Default has occurred and is
continuing, specifying the nature and extent thereof, which certificate shall,
in the case of any such financial statements delivered in respect of a period
ending on the last day of a fiscal quarter or year of Holdings, (x) set forth
the calculations required to establish whether the Borrower was in compliance
with the provisions of Sections 9.03, 9.04, 9.05, and 9.07 through 9.09,
inclusive, at the end of such fiscal quarter or year, as the case may be and (y)
if delivered with the financial statements required by Section 8.01(c), set
forth the calculations required to establish whether the Borrower was in
compliance with the provisions of Section 4.02(A)(h) and set forth the amount of
Excess Cash Flow for the respective Excess Cash Payment Period.
(g) NOTICE OF DEFAULT OR LITIGATION. Promptly, and in any event
within five Business Days after an Authorized Officer of Holdings or the
Borrower obtains knowledge thereof, notice of (i) the occurrence of any event
which constitutes a Default or Event of Default and (ii) any litigation or
governmental investigation or proceeding pending against Holdings or any of its
Subsidiaries which could reasonably be expected to result in a Material Adverse
Effect.
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(h) OTHER REPORTS AND FILINGS. Promptly, copies of all financial
information, proxy materials and other information and reports, if any, which
Holdings or any of its Subsidiaries shall file with the Securities and Exchange
Commission or any successor thereto (the "SEC") including, without limitation,
in connection with the registration of the Senior Subordinated Notes.
(i) ANNUAL MEETINGS WITH BANKS. At the request of the Administrative
Agent, Holdings shall within 120 days after the close of each fiscal year of
Holdings hold a meeting at a time and place selected by Holdings and acceptable
to the Administrative Agent with all of the Banks at which meeting shall be
reviewed the financial results of the previous fiscal year and the financial
condition of Holdings and the budgets presented for the current fiscal year of
Holdings and its Subsidiaries.
(j) OTHER INFORMATION. From time to time, such other information or
documents (financial or otherwise) with respect to Holdings or its Subsidiaries
as any Bank may reasonably request in writing.
8.02 BOOKS, RECORDS AND INSPECTIONS. Holdings will, and will cause
each of its Subsidiaries to, keep proper books of record and account in which
full, true and correct entries in material conformity with GAAP and all
requirements of law shall be made of all dealings and transactions in relation
to its business and activities. Holdings will, and will cause each of its
Subsidiaries to, permit officers and designated representatives of the
Administrative Agent or any Bank to visit and inspect, during regular business
hours, upon reasonable advance notice and under guidance of officers of
Holdings, the Borrower or such Subsidiary, any of the properties of Holdings,
the Borrower or such Subsidiary, and to examine the books of account of
Holdings, the Borrower or such Subsidiary and discuss the affairs, finances and
accounts of Holdings, the Borrower or such Subsidiary with, and be advised as to
the same by, its and their officers, all at such reasonable times and intervals
and to such reasonable extent as the Administrative Agent or such Bank may
request.
8.03 MAINTENANCE OF PROPERTY; INSURANCE. (a) Schedule IV sets forth
a true and complete listing of all insurance maintained by Holdings, and its
Subsidiaries as of the Effective Date. Holdings will, and will cause each of
its Subsidiaries to, (i) keep all property necessary in its business in good
working order and condition (ordinary wear and tear excepted), (ii) maintain
insurance on all its property in at least such amounts and against at least such
risks as is consistent and in accordance with industry practice and (iii)
furnish to each Bank, upon written request, full information as to the insurance
carried. In addition to the requirements of the immediately preceding sentence,
Holdings and the Borrower will at all times cause insurance of the types
described in Schedule IV to be maintained (with the same scope of coverage as
that described in Schedule IV) at levels which are at least as great as the
respective amount described opposite the respective type of insurance on
Schedule IV under the column headed "Minimum Amount Required to be Maintained."
Notwithstanding the foregoing, if such insurance ceases to be available or is no
longer available on commercially reasonable terms, the Borrower may, with the
consent of the Administrative Agent (not to be unreasonably withheld), cease to
maintain such insurance or maintain such insurance at levels that are
commercially reasonable.
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(b) All policies (including Mortgage Policies) or certificates (or
certified copies thereof) with respect to such insurance (i) shall be endorsed
to the Collateral Agent's satisfaction for the benefit of the Collateral Agent
(including, without limitation, by naming the Collateral Agent as loss payee or
as an additional insured), (ii) shall state that such insurance policies shall
not be canceled without 30 days' prior written notice thereof by the respective
insurer to the Collateral Agent, (iii) shall provide that the respective
insurers irrevocably waive any and all rights of subrogation with respect to the
Collateral Agent and the Secured Creditors, (iv) shall contain the standard
non-contributory mortgagee clause endorsement in favor of the Collateral Agent
with respect to hazard insurance coverage, (v) shall, except in the case of
public liability insurance and workers' compensation insurance, PROVIDED, that
any losses shall be payable notwithstanding (A) any act or neglect of Holdings
or any of its Subsidiaries, (B) the occupation or use of the properties for
purposes more hazardous than those permitted by the terms of the respective
policy if such coverage is obtainable at commercially reasonable rates and is of
the kind from time to time customarily insured against by Persons owning or
using similar property and in such amounts as are customary, (C) any foreclosure
or other proceeding relating to the insured properties if such coverage is
available at commercially reasonable rates or (D) any change in the title to or
ownership or possession of the insured properties if such coverage is available
at commercially reasonable rates and (vi) shall be deposited with the Collateral
Agent if such coverage is available at commercially reasonable rates.
(c) If Holdings or any of its Subsidiaries shall fail to maintain all
insurance in accordance with this Section 8.03, or if Holdings or any of its
Subsidiaries shall fail to so endorse and deposit all policies or certificates
with respect thereto, the Administrative Agent and/or the Collateral Agent shall
have the right (but shall be under no obligation) to procure such insurance and
the Borrower agrees to reimburse the Administrative Agent or the Collateral
Agent as the case may be, for all costs and expenses of procuring such
insurance.
8.04 CORPORATE FRANCHISES. Holdings will, and will cause each of its
Subsidiaries to, do or cause to be done, all things necessary to preserve and
keep in full force and effect its existence and its material rights, franchises,
licenses and patents; PROVIDED, HOWEVER, that nothing in this Section 8.04 shall
prevent (i) sales of assets (including, without limitation, capital stock of, or
other equity interests in, Subsidiaries of the Borrower) by Holdings or any of
its Subsidiaries in accordance with Section 9.02 or (ii) the withdrawal by
Holdings or any of its Subsidiaries of their qualification as a foreign
corporation in any jurisdiction where such withdrawal could not reasonably be
expected to have a Material Adverse Effect or (iii) mergers or consolidations or
liquidations permitted under Section 9.02.
8.05 COMPLIANCE WITH STATUTES, ETC. Holdings will, and will cause
each of its Subsidiaries to, comply with all applicable statutes, regulations
and orders of, and all applicable restrictions imposed by, all governmental
bodies, domestic or foreign, in respect of the conduct of its business and the
ownership of its property, except such noncompliances as could not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
8.06 ERISA. As soon as possible and, in any event, within 20 days
after Holdings, the Borrower or any of their respective Subsidiaries or any
ERISA Affiliate knows or has reason to know of the occurrence of any of the
following, Holdings or the Borrower will
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deliver to each of the Banks a certificate of an Authorized Officer of Holdings
or the Borrower setting forth details as to such occurrence and the action, if
any, that Holdings, the Borrower, such Subsidiary or such ERISA Affiliate is
required or proposes to take, together with any notices required or proposed to
be given to or filed with or by Holdings, the Borrower, such Subsidiary, the
ERISA Affiliate, the PBGC, or a Plan participant or the Plan administrator with
respect thereto: that a Reportable Event has occurred; that an accumulated
funding deficiency has been incurred or an application is likely to be or has
been made to the Secretary of the Treasury for a waiver or modification of the
minimum funding standard (including any required installment payments) or an
extension of any amortization period under Section 412 of the Code with respect
to a Plan; that a contribution required to be made to a Plan has not been timely
made; that a Plan has been or is reasonably expected to be terminated,
reorganized, partitioned or declared insolvent under Title IV of ERISA; that a
Plan has an Unfunded Current Liability giving rise to a lien under ERISA or the
Code; that proceedings are likely to be or have been instituted or notice has
been given to terminate or appoint a trustee to administer a Plan; that a
proceeding has been instituted pursuant to Section 515 of ERISA to collect a
delinquent contribution to a Plan; that Holdings, the Borrower, any of their
respective Subsidiaries or any ERISA Affiliate will or is reasonably expected to
incur any material liability (including any contingent or secondary liability)
to or on account of the termination of or withdrawal from a Plan under Section
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan
under Section 401(a)(29), 4971 or 4975 of the Code or Section 409 or 502(i) or
502(l) of ERISA; or that Holdings, the Borrower or any Subsidiary may incur any
material liability pursuant to any employee welfare benefit plan (as defined in
Section 3(1) of ERISA) that provides benefits to retired employees or other
former employees (other than as required by Section 601 of ERISA) or any
employee pension benefit plan (as defined in Section 3(2) of ERISA). Upon
request the Borrower will deliver to each of the Banks a complete copy of the
annual report (Form 5500) of each Plan required to be filed with the Internal
Revenue Service. In addition to any certificates or notices delivered to the
Banks pursuant to the first sentence hereof, copies of annual reports and any
material notices received by Holdings, the Borrower or any of their respective
Subsidiaries or any ERISA Affiliate with respect to any Plan shall be delivered
to the Banks no later than 20 days after the date such report has been filed
with the Internal Revenue Service or such notice has been received by Holdings,
the Borrower, the Subsidiary or the ERISA Affiliate, as applicable.
8.07 END OF FISCAL YEARS; FISCAL QUARTERS. Holdings shall cause (i)
each of its and the Borrower's, fiscal years to end on December 31, and (ii)
each of its and the Borrower's fiscal quarters to end on March 31, June 30 and
September 30.
8.08 PERFORMANCE OF OBLIGATIONS. Holdings will, and will cause each
of its Subsidiaries to, perform all of their obligations under the terms of each
mortgage, indenture, security agreement and other debt instrument by which it is
bound, except such non-performances as could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
8.09 PAYMENT OF TAXES. Holdings will pay and discharge or cause to
be paid and discharged, and will cause each of its Subsidiaries to pay and
discharge, all taxes, assessments and governmental charges or levies imposed
upon it or upon its income or profits, or upon any properties belonging to it,
in each case on a timely basis, and all lawful claims of governmental
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authorities which, if unpaid, might become a lien or charge upon any properties
of Holdings or any of its Subsidiaries; PROVIDED that none of Holdings nor any
of its Subsidiaries shall be required to pay any such tax, assessment, charge,
levy or claim which is being contested in good faith and by proper proceedings
if it has maintained adequate reserves with respect thereto in accordance with
GAAP.
8.10 MAINTENANCE OF SEPARATENESS. Holdings will, and will cause each
of its Subsidiaries to, satisfy customary corporate formalities including the
holding of regular board of directors' and shareholders' meetings and the
maintenance of corporate offices and records. None of the Borrower nor any of
its Subsidiaries shall make any payment to a creditor of Holdings in respect of
any liability of Holdings which is not a liability of the Borrower or such
Subsidiary, and no bank account of Holdings shall be commingled with any bank
account of the Borrower or any of its Subsidiaries. Any financial statements
distributed to any creditors of Holdings shall, to the extent permitted by GAAP,
clearly establish the corporate separateness of Holdings from the Borrower and
its Subsidiaries. Finally, neither Holdings nor any of its Subsidiaries shall
take any action, or conduct its affairs in a manner, which could result in the
corporate existence of Holdings being ignored, or in the assets and liabilities
of the Borrower or any of its Subsidiaries being substantively consolidated with
those of Holdings in a bankruptcy, reorganization or other insolvency
proceeding.
8.11 ADDITIONAL SECURITY; FURTHER ASSURANCES. (a) Holdings and the
Borrower will, and will cause each of their respective Domestic Subsidiaries to,
grant to the Collateral Agent security interests in Reinvestment Assets at the
time of the acquisition thereof as described in this clause (a). To the extent
Reinvestment Assets are acquired by the Borrower and/or its Domestic
Subsidiaries, the Borrower or such Domestic Subsidiary shall xxxxx x Xxxx on and
a security interest in such Reinvestment Assets on the same terms as set forth
in the Security Documents and as otherwise set forth in this Section 8.11. To
the extent Reinvestment Assets are acquired by a merger or the acquisition of
capital stock, the Borrower shall cause the Person acquiring such Reinvestment
Assets to become a Subsidiary of the Borrower and/or its Subsidiaries, and shall
pledge or cause to be pledged (x) all capital stock owned by such acquiring
Person of any such Person so acquired which is a Domestic Subsidiary, and (y)
with respect to any such Person so acquired which is not a Domestic Subsidiary,
the lesser of (x) all of the capital stock owned by such acquiring Person of any
such Person so acquired or (y) 65% of the capital stock of such Person so
acquired, in each case pursuant to the Pledge Agreement or another agreement
similar thereto. The Borrower shall cause any such Domestic Subsidiary so
acquired to enter into a guaranty substantially similar to the Subsidiary
Guaranty and additional security documents substantially similar to the Security
Documents (to the extent applicable), all as otherwise as set forth in this
Section 8.11.
(b) Holdings will, and will cause each of its Domestic Subsidiaries
to, grant to the Collateral Agent security interests and mortgages (an
"Additional Mortgage") in such Real Property of Holdings or any of its Domestic
Subsidiaries as are not covered by the original Mortgages to the extent acquired
after the Effective Date, and as may reasonably be requested from time to time
by the Administrative Agent or the Required Banks (each such Real Property, an
"Additional Mortgaged Property"). All such Additional Mortgages shall be
granted pursuant to documentation substantially in the form of the Mortgages
delivered to the Administrative
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Agent on the Effective Date or in such other form as is reasonably satisfactory
to the Administrative Agent and shall constitute valid and enforceable perfected
Liens superior to and prior to the rights of all third Persons and subject to no
other Liens except as are permitted by Section 9.01 at the time of perfection
thereof. The Additional Mortgages or instruments related thereto shall have been
duly recorded or filed in such manner and in such places as are required by law
to establish, perfect, preserve and protect the Liens in favor of the Collateral
Agent required to be granted pursuant to the Additional Mortgages and all taxes,
fees and other charges payable in connection therewith shall have been paid in
full.
(c) Holdings will, and will cause each of its Domestic Subsidiaries
to, grant to the Collateral Agent security interests in assets acquired pursuant
to Sections 9.02 (xiii) and (xiv) at the time of the acquisition thereof as
described in this clause (c). In connection with the acquisition of the capital
stock of a Person that becomes a Domestic Subsidiary of the Borrower, the
Borrower shall pledge or cause to be pledged all capital stock of any such
Person so acquired which is owned by the Borrower or any Subsidiary Guarantor
pursuant to the Pledge Agreement and cause such Person to enter into a guaranty
substantially similar to the Subsidiary Guaranty and additional security
documents substantially similar to the Security Documents (to the extent
applicable), all as otherwise set forth in this Section 8.11.
(d) Holdings will, and will cause each of its Domestic Subsidiaries
to, at the expense of the Borrower, make, execute, endorse, acknowledge, file
and/or deliver to the Collateral Agent from time to time such vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates, real
property surveys, reports and other assurances or instruments and take such
further steps relating to the Collateral covered by any of the Security
Documents as the Collateral Agent may reasonably require pursuant to this
Section 8.11. Furthermore, Holdings and the Borrower shall cause to be
delivered to the Collateral Agent such opinions of counsel, title insurance and
other related documents as may be reasonably requested by the Collateral Agent
to assure itself that this Section 8.11 has been complied with.
(e) Holdings will cause each Domestic Subsidiary established or
created in accordance with Section 9.14 to duly authorize, execute and deliver
to the Administrative Agent a guaranty of all Obligations and all obligations
under Interest Rate Protection Agreements in substantially the form of Exhibit J
hereto (as amended, modified, extended, renewed, replaced, restated or
supplemented from time to time, the "Subsidiary Guaranty").
(f) Holdings will cause each Domestic Subsidiary established or
created in accordance with Section 9.14 to grant to the Collateral Agent a first
priority Lien on all property (tangible and intangible) of such Subsidiary upon
terms similar to those set forth in the Security Documents (including, without
limitation, the Pledge Agreement (subject to the proviso contained in Section
5.07) and the Security Agreement) as appropriate, and reasonably satisfactory in
form and substance to the Collateral Agent and Required Banks. Holdings and the
Borrower will cause each Domestic Subsidiary, at its own expense, to execute,
acknowledge and deliver, or cause the execution, acknowledgment and delivery of,
and thereafter register, file or record in any appropriate governmental office,
any document or instrument reasonably deemed by the Collateral Agent to be
necessary or desirable for the creation and perfection of the foregoing Liens.
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Holdings and the Borrower will cause each of its Subsidiaries to take all
actions reasonably requested by the Collateral Agent (including, without
limitation, the filing of UCC-1's) in connection with the granting of such
security interests.
(g) The security interests required to be granted pursuant to this
Section 8.11 shall be granted pursuant to security documentation (which shall be
substantially similar to the Security Documents already executed and delivered
by the Borrower or its Subsidiaries, as applicable) or reasonably satisfactory
in form and substance to the Administrative Agent and shall constitute valid
and enforceable perfected security interests prior to the rights of all third
Persons and subject to no other Liens except such Liens and priority as are
permitted by Section 9.01. The Additional Security Documents and other
instruments related thereto shall be duly recorded or filed in such manner and
in such places and at such times as are required by law to establish, perfect,
preserve and protect the Liens, in favor of the Collateral Agent for the benefit
of the respective Secured Creditors, required to be granted pursuant to the
Additional Security Documents and all taxes, fees and other charges payable in
connection therewith shall be paid in full by the Borrower. At the time of the
execution and delivery of the Additional Security Documents, the Borrower shall
cause to be delivered to the Collateral Agent such opinions of counsel, Mortgage
Policies, title surveys, real estate appraisals and other related documents as
may be reasonably requested by the Administrative Agent or the Required Banks to
assure themselves that this Section 8.11 has been complied with.
(h) Each of Holdings and the Borrower agrees that each action
required above by Section 8.11(d) shall be completed as soon as possible, but in
no event later than 60 days after such action is requested to be taken by the
Administrative Agent or the Required Banks. Each of Holdings and the Borrower
further agrees that each action required by Section 8.11(a) and (e) shall be
completed within 10 Business Days and, to the extent applicable in connection
with the pledge of stock acquired in connection with the creation or acquisition
of a new Subsidiary, 8.11(e), (f) and (g) with respect to Additional Collateral,
shall be completed within 60 days of the acquisition of the assets to become
Additional Collateral.
SECTION 9. NEGATIVE COVENANTS. Holdings and the Borrower covenant
and agree that on and after the Effective Date and until the Total Commitments
and all Letters of Credit have terminated and the Loans, Notes and Unpaid
Drawings, together with interest, Fees and all other Obligations incurred
hereunder and thereunder, are paid in full:
9.01 LIENS. Holdings will not, and will not permit any of its
Subsidiaries to, create, incur, assume or suffer to exist any Lien upon or with
respect to any property or assets (real or personal, tangible or intangible) of
Holdings or any of its Subsidiaries, whether now owned or hereafter acquired, or
sell any such property or assets subject to an understanding or agreement,
contingent or otherwise, to repurchase such property or assets (including sales
of accounts receivable with recourse to Holdings or any of its Subsidiaries), or
assign any right to receive income or permit the filing of any financing
statement under the UCC or any other similar notice of Lien under any similar
recording or notice statute; PROVIDED that the provisions of this Section 9.01
shall not prevent the creation, incurrence, assumption or existence of the
following (Liens described below are herein referred to as "Permitted Liens"):
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(i) inchoate Liens for taxes, assessments or governmental charges
or levies not yet due and payable or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and by
appropriate proceedings for which adequate reserves have been established
in accordance with GAAP or Liens for property taxes on property which is to
be abandoned or for which the sole recourse for such tax, assessment or
governmental charge or levy is to such property;
(ii) Liens in respect of property or assets of the Borrower or any
of its Subsidiaries imposed by law, which were incurred in the ordinary
course of business and do not secure Indebtedness for borrowed money, such
as carriers', warehousemen's, materialmen's and mechanics' liens and other
similar Liens arising in the ordinary course of business, and (x) which do
not in the aggregate materially detract from the value of the Borrower's or
such Subsidiary's property or assets or materially impair the use thereof
in the operation of the business of the Borrower or such Subsidiary or (y)
which are being contested in good faith by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the
property or assets subject to any such Lien;
(iii) Liens in existence on the Effective Date which are listed, and
the property subject thereto described, in Schedule V, but only to the
respective date, if any, set forth in such Schedule V for the removal and
termination of any such Liens, plus renewals, replacements and extensions
of such Liens to the extent set forth on Schedule V, PROVIDED that (x) the
aggregate principal amount of the Indebtedness, if any, secured by such
Liens does not increase from that amount outstanding at the time of any
such renewal, replacement or extension and (y) any such renewal,
replacement or extension does not encumber any additional assets or
properties of Holdings or any of its Subsidiaries;
(iv) Permitted Encumbrances;
(v) Liens created pursuant to the Security Documents;
(vi) licenses, leases or subleases granted to other Persons in the
ordinary course of business not materially interfering with the conduct of
the business of Holdings and its Subsidiaries taken as a whole;
(vii) Liens upon assets subject to Capitalized Lease Obligations to
the extent permitted by Section 9.04(v), PROVIDED that (x) such Liens only
serve to secure the payment of Indebtedness arising under such Capitalized
Lease Obligation (and replacements, extensions, refinancings and renewals
thereof) and (y) the Lien encumbering the assets giving rise to the
Capitalized Lease Obligation does not encumber any other asset of the
Borrower or any Subsidiary of the Borrower;
(viii) Liens placed upon equipment or machinery or other personal or
real property used in the ordinary course of business of the Borrower or
any of its Subsidiaries at the time of acquisition thereof by the Borrower
or any such Subsidiary or within 180 days thereafter to secure Indebtedness
incurred to pay all or a portion of the purchase price thereof and all
renewals, replacements, refinancings or extensions thereof, PROVIDED
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that (x) the aggregate outstanding principal amount of all Indebtedness
secured by Liens permitted by this clause (viii) shall not at any time
exceed $10,000,000 and (y) in all events, the Lien encumbering the
equipment or machinery so acquired does not encumber any other asset of the
Borrower or such Subsidiary;
(ix) easements, rights-of-way, restrictions (including zoning
restrictions), encroachments, protrusions and other similar charges or
encumbrances, and minor title deficiencies, in each case whether now or
hereafter in existence, not securing Indebtedness for borrowed money and
not materially interfering with the conduct of the business of the Borrower
or any of its Subsidiaries;
(x) Liens arising from precautionary UCC financing statement
filings regarding operating leases entered into by Holdings or any of its
Subsidiaries;
(xi) Liens arising out of the existence of judgments or awards not
constituting an Event of Default under Section 10.09, PROVIDED that no cash
or property in excess of $7,500,000 is deposited or delivered to secure the
respective judgment or award;
(xii) statutory, contractual and common law landlords' liens under
leases to which Holdings or any of its Subsidiaries is a party;
(xiii) Liens (other than any Lien imposed by ERISA) incurred or
deposits made in the ordinary course of business in connection with
workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations,
surety, stay, customs and appeal bonds, statutory bonds, bids, leases,
government contracts, trade contracts, performance and return of money
bonds and other similar obligations (exclusive of obligations for the
payment of borrowed money), PROVIDED that the aggregate amount of deposits
at any time pursuant to this clause (xiii) shall not exceed $7,500,000;
(xiv) any interest or title of a lessor, sublessor, licensee or
licensor under any lease or license agreement permitted by this Agreement;
(xv) Liens in favor of a banking institution arising as a matter of
law encumbering deposits (including the right of set-off) held by such
banking institutions incurred in the ordinary course of business and which
are within the general parameters customary in the banking industry;
(xvi) deposits made in the ordinary course of business to secure
liabilities for premiums to insurance carriers;
(xvii) Liens arising out of conditional sale, title retention,
consignment or similar arrangements for sale of goods entered into by the
Borrower or any of its Subsidiaries in the ordinary course of business;
(xviii) Liens on assets of Foreign Subsidiaries to secure Foreign
Subsidiary Indebtedness;
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(xix) Liens arising in connection with transactions relating to
accounts receivable permitted under Section 9.02 (xi);
(xx) Liens existing on any asset or property of the Borrower or any
Subsidiary of the Borrower prior to the acquisition of such asset or
property or prior to the time any such Subsidiary became a Subsidiary of
the Borrower (and any replacement, extension or renewal of such Lien so
long as such Lien (as so extended, replaced or renewed) does not (i) secure
obligations in excess of $15,000,000 and (ii) extend to any property that
was not subject to such Lien prior to such replacement, extension or
renewal; and
(xxi) Liens securing reimbursement obligations not to exceed
$2,500,000 in respect of trade related letters of credit provided in the
ordinary course of business (exclusive of reimbursement obligations in
respect of Letters of Credit) and covering the goods (or the documents of
title in respect of such goods) financed by such letters of credit.
9.02 CONSOLIDATION, MERGER, PURCHASE OR SALE OF ASSETS, ETC.
Holdings will not, and will not permit any of its Subsidiaries to, wind up,
liquidate or dissolve its affairs or enter into any transaction of merger or
consolidation, or convey, sell, lease or otherwise dispose of (or agree to do
any of the foregoing at any future time) all or any part of its property or
assets, or enter into any sale-leaseback transactions, or purchase or otherwise
acquire (in one or a series of related transactions) any part of the property or
assets (other than purchases or other acquisitions of inventory, materials,
equipment and intangible assets, including property acquired by way of trade or
barter agreements, in the ordinary course of business) of any Person, except
that:
(i) Capital Expenditures made by the Borrower and its Subsidiaries
shall be permitted to the extent not in violation of Section 9.07;
(ii) each of the Borrower and its Subsidiaries may sell, lease or
otherwise dispose of any assets PROVIDED that (a) the aggregate Net Sale
Proceeds of all assets subject to sales or other dispositions pursuant to
this clause (ii) shall not exceed $15,000,000 in any fiscal year of the
Borrower, (b) each such disposition is for fair market value and (c) at
least 75% of the consideration received in respect thereof is cash (or Cash
Equivalents) (including assumption of Indebtedness);
(iii) in addition to sales, leases, transfers, conveyances or
dispositions otherwise permitted, each of the Borrower and its Subsidiaries
may sell, lease, transfer, convey or otherwise dispose of property,
equipment or other assets that is (a) obsolete or worn out or (b) no longer
useful or necessary in the operation of the business of such Person;
(iv) investments may be made to the extent permitted by Section
9.05;
(v) each of the Borrower and its Subsidiaries may lease (as
lessee) real or personal property in the ordinary course of business (so
long as such lease does not create a Capitalized Lease Obligation not
otherwise permitted by Section 9.04(v));
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(vi) each of the Borrower and its Subsidiaries may make sales,
conveyances, dispositions or other transfers of goods, equipment and
inventory (including pursuant to barter or trade transactions) in the
ordinary course of business;
(vii) licenses or sublicenses by the Borrower and its Subsidiaries
of software, trademarks, patents and other intellectual property in the
ordinary course of business and which do not materially interfere with the
business of the Borrower or any Subsidiary;
(viii) the Borrower or any Subsidiary Guarantor may transfer assets
to or lease assets to or acquire or lease assets from the Borrower or any
other Subsidiary Guarantor (so long as the security interests granted
pursuant to the Security Documents is not, in the reasonable judgment of
the Collateral Agent, adversely affected thereby) or any Subsidiary of the
Borrower may be merged or consolidated with or into, or be liquidated into,
the Borrower or any Subsidiary Guarantor (so long as the Borrower or such
Subsidiary Guarantor is the surviving corporation);
(ix) any Foreign Subsidiary may be merged with and into, or be
dissolved or liquidated into, or transfer any of its assets to, any other
Foreign Subsidiary;
(x) the Transaction shall be permitted;
(xi) the Borrower and its Subsidiaries may sell or discount, in
each case without recourse (except for customary indemnities,
representations, warranties and agreements) and in the ordinary course of
business, accounts receivable arising in the ordinary course of business
(x) which are overdue or (y) which the Borrower may reasonably determine
are difficult to collect, but only in connection with the compromise or
collection thereof (and not as part of any bulk sale or financing of
receivables);
(xii) transfers of condemned property to the respective governmental
authority or agency that have condemned same (whether by deed in lieu of
condemnation or otherwise), and transfers of properties that have been
subject to a casualty to the respective insurer of such property or its
designee as part of an insurance settlement, so long as the proceeds
thereof are applied as required by Section 4.02(A)(i);
(xiii) the Borrower and its Subsidiaries may acquire the capital
stock (or other equity interests) or assets of any Person which is merged
into, or becomes a Domestic Subsidiary of, the Borrower or such Subsidiary
so long as the aggregate amount expended pursuant to this clause (xiii)
does not exceed $10,000,000; and
(xiv) in addition to the acquisition permitted pursuant to preceding
clause (xiii), the Borrower and its Subsidiaries may acquire the capital
stock (or other equity interests) or assets of any Person which is merged
into, or becomes a Domestic Subsidiary of, the Borrower or such Subsidiary
with (a) the reinvestment of Excess Cash Flow for the relevant Excess Cash
Payment Period to the extent (x) not required to be applied to repay the
Loans pursuant to Section 4.02(A)(h), (y) not used to make Capital
Expenditures
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pursuant to Section 9.07(c)(iii) and (z) not used to make investments
pursuant to Section 9.05(ix);
To the extent the Required Banks waive the provisions of this Section 9.02 with
respect to the sale of any Collateral, or any Collateral is sold as permitted by
this Section 9.02 (other than clause (vii) thereof), such Collateral shall be
sold free and clear of the Liens created by the Security Documents, and the
Administrative Agent and Collateral Agent shall be authorized to take any
actions deemed appropriate in order to effect the foregoing and shall, at the
request of the Borrower, take any such actions reasonably appropriate to effect
the foregoing.
9.03 DIVIDENDS. Holdings shall not, and shall not permit any of its
Subsidiaries to, authorize, declare or pay any Dividends with respect to
Holdings or any of its Subsidiaries except that:
(i) any Subsidiary of the Borrower may pay Dividends to the
Borrower or any Wholly-Owned Domestic Subsidiary of the Borrower;
(ii) any Foreign Subsidiary of the Borrower may pay dividends to
the Borrower or any of its Subsidiaries or any other Person owning an
equity interest in such Foreign Subsidiary;
(iii) the Borrower may pay cash Dividends to Holdings for the
purpose of paying, so long as all proceeds thereof are promptly used by
Holdings to pay, its operating expenses incurred in the ordinary course of
business and other corporate overhead costs and expenses (including,
without limitation, legal and accounting expenses and similar expenses) in
a maximum principal amount of $1,000,000 per annum;
(iv) Holdings may pay cash Dividends, and the Borrower may pay cash
Dividends to Holdings to enable Holdings, to pay management fees or
executive compensation to the extent such management fees or executive
compensation are permitted by Section 9.06(iv) and (v);
(v) the Borrower may pay cash Dividends to Holdings for the
purpose of paying, so long as all proceeds thereof are promptly used by
Holdings to pay franchise taxes and federal, state and local income taxes
and interest, and penalties with respect thereto, if any, payable by
Holdings, PROVIDED that any refund shall be promptly returned by Holdings
to the Borrower; and
(vi) so long as there shall exist no Default or Event of Default
(both before and after giving effect to the payment thereof), the Borrower
may pay cash Dividends to Holdings so long as the proceeds thereof, are
simultaneously used by Holdings to pay interest, when and as due, on the
Holdings Debentures in accordance with the terms of the Holdings Debenture
Documents; PROVIDED that (x) any payments of Dividends to Holdings by the
Borrower pursuant to this Section 9.03(vi) shall not be made before the
fifth year after the Effective Date; and (y) at the time of any payments of
Dividends to Holdings by the Borrower pursuant to this Section 9.03(vi)
(both before and after giving effect to such
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payment) the Consolidated Fixed Charge Coverage Ratio shall be equal to or
greater than1.0:1.0.
9.04 INDEBTEDNESS. Holdings will not, and will not permit any of its
Subsidiaries to, contract, create, incur, assume or suffer to exist any
Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and the other
Credit Documents;
(ii) Indebtedness existing on the Borrower's balance sheet as at
March 31, 1998 shall be permitted in an aggregate principal amount not to
exceed the sum of $5,000,000 PLUS the aggregate principal amount thereof as
of March 31, 1998 (as the same may be refinanced or replaced, so long as
the principal amount thereof is not increased by more than $5,000,000);
(iii) accrued expenses and current trade accounts payable incurred
in the ordinary course of business;
(iv) Indebtedness under Interest Rate Protection Agreements to the
extent entered into pursuant to Section 9.05;
(v) Indebtedness evidenced by Capitalized Lease Obligations to the
extent permitted pursuant to Section 9.07;
(vi) Indebtedness subject to Liens permitted under Sections
9.01(viii) and (xxi);
(vii) Indebtedness (x) of the Borrower evidenced by the Senior
Subordinated Notes issued on the Initial Borrowing Date in an aggregate
principal amount not to exceed $175,000,000 (PLUS the principal amount of
Senior Subordinated Notes that may be issued pursuant to the
payment-in-kind provisions thereof) and (y) arising under guaranties by the
Subsidiary Guarantors of the obligations of the Borrower under the Senior
Subordinated Notes;
(viii) Indebtedness of Holdings evidenced by the Holdings Debentures
in an aggregate principal amount not to exceed $57,000,000;
(ix) additional Indebtedness of the Borrower and its Subsidiaries
(other than Foreign Subsidiaries) not to exceed $15,000,000 in aggregate
principal amount outstanding at any time;
(x) Contingent Obligations of the Borrower or any Subsidiary as a
guarantor of the lessee under any lease pursuant to which the Borrower or a
Subsidiary is the lessee so long as such lease is otherwise permitted
hereunder;
(xi) intercompany Indebtedness (a) among the Borrower and the
Subsidiary Guarantors and (b) among Subsidiary Guarantors; and
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(xii) intercompany Indebtedness (a) among the Foreign Subsidiaries
of the Borrower and (b) between the Borrower or any Subsidiary as lender
and any Foreign Subsidiary as borrower, PROVIDED that the aggregate amount
of such intercompany loans pursuant to this clause (b) shall be subject to
the limitations of Section 9.05 (x).
(xiii) Indebtedness of the Borrower or its Subsidiaries in respect of
performance bonds, bid bonds, appeal bonds, surety bonds and similar
obligations and trade-related letters of credit, in each case provided in
the ordinary course of business, and any extension, renewal or refinancing
thereof to the extent not provided to secure the repayment of other
Indebtedness and to the extent that the amount of refinancing Indebtedness
is not greater than the amount of Indebtedness being refinanced;
(xiv) Indebtedness arising from the honoring by a bank or other
financial institution of a check, draft or similar instrument drawn against
sufficient funds in the ordinary course of business, PROVIDED that such
Indebtedness is extinguished within five Business Days of its incurrence;
(xv) Indebtedness of a Subsidiary acquired after the date hereof
and Indebtedness of a corporation merged or consolidated with or into the
Borrower or a Subsidiary after the date hereof, which Indebtedness in each
case exists at the time of such acquisition, merger or consolidation and is
not created in contemplation of such event and where such acquisition,
merger or consolidation is permitted by this Agreement (and any extension,
renewal or refinancing thereof), PROVIDED that the aggregate principal
amount of Indebtedness outstanding under this clause shall not exceed
$15,000,000; and
(xvi) additional Foreign Subsidiary Indebtedness (and any extension,
renewal or refinancing thereof); provided that the aggregate principal
amount of outstanding Foreign Subsidiary Indebtedness permitted under this
clause (xvi) at any time shall not exceed $25,000,000.
9.05 ADVANCES, INVESTMENTS AND LOANS. Holdings will not, and will
not permit any of its Subsidiaries to, directly or indirectly, lend money or
credit or make advances to any Person, or purchase or acquire any stock,
obligations or securities of, or any other interest in, or make any capital
contribution to, any other Person, or purchase or own a futures contract or
otherwise become liable for the purchase or sale of currency or other
commodities at a future date in the nature of a futures contract, or hold any
cash or Cash Equivalents, except that the following shall be permitted:
(i) the Borrower and its Subsidiaries may acquire and hold
accounts receivables owing to any of them, if created or acquired in the
ordinary course of business and payable or dischargeable in accordance with
customary terms;
(ii) the Borrower and its Subsidiaries may acquire and hold cash
and Cash Equivalents;
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(iii) the Borrower and its Subsidiaries may make loans and advances
in the ordinary course of business to their respective officers, directors
and employees so long as the aggregate principal amount thereof at any time
outstanding (determined without regard to any write-downs or write-offs of
such loans and advances) shall not exceed $1,000,000;
(iv) the Borrower may enter into Interest Rate Protection
Agreements on terms satisfactory to the Administrative Agent;
(v) Holdings and any of its Subsidiaries may make investments
necessary to form Subsidiaries of the Borrower under Section 9.14;
(vi) promissory notes and other similar non-cash consideration
received by the Borrower and its Subsidiaries in connection with
dispositions permitted by Section 9.02;
(vii) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection with the
bankruptcy or reorganization of suppliers and customers and in settlement
of delinquent obligations of, and other disputes with, customers and
suppliers arising in the ordinary course of business;
(viii) investments by the Borrower or any Subsidiary in any
Subsidiary Guarantor;
(ix) investments by the Borrower and its Subsidiaries (other than
investments made in Foreign Subsidiaries or Foreign Joint Ventures)
consisting of the reinvestment of Excess Cash Flow for the relevant Excess
Cash Payment Period to the extent (w) not required to be applied to repay
the Loans pursuant to Section 4.02(A)(h), (x) not used to make Capital
Expenditures pursuant to Section 9.07(c)(iii), (y) not used to make
acquisitions pursuant to Section 9.02(xiv) and (z) such investments (other
than investments resulting in the ownership by the Borrower and/or its
Subsidiaries of 100% of the capital stock of the Person in which such
investment is made) in an aggregate principal amount (net of any amount of
such investments returned to the Borrower and its Subsidiaries) do not
exceed $2,000,000;
(x) (i) the Borrower and any Subsidiary of the Borrower may make
investments in any Foreign Subsidiary or Foreign Joint Venture of the
Borrower, PROVIDED that the aggregate amount of such investments (net of
any amount of such investments returned to the Borrower or such Subsidiary
Guarantor) shall not exceed $35,000,000 and (ii) Foreign Subsidiaries and
Foreign Joint Ventures may make investments among one another;
(xi) the Borrower and its Subsidiaries may make acquisitions
permitted under Section 9.02(xiii);
(xii) the Borrower and its Subsidiaries may incur Indebtedness
permitted under Section 9.04 (xi) and (xii);
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(xiii) the Borrower and its Subsidiaries may make acquisitions
permitted by the definition of Capital Expenditures contained in Section
11;
(xiv) the Borrower and its Subsidiaries may make investments in
accordance with Sections 4.02(A)(g) and 4.02(A)(i); and
(xv) in addition to investments permitted by clauses (i) through
(xiv) of this Section 9.05, the Borrower and its Subsidiaries may make
additional loans, advances and investments (other than investments in
Foreign Subsidiaries and Foreign Joint Ventures) in an aggregate principal
amount not to exceed $2,000,000 in any fiscal year (net of any amount of
such investments returned to the Borrower and its Subsidiaries).
9.06 TRANSACTIONS WITH AFFILIATES. Holdings will not, and will not
permit any of its Subsidiaries to, enter into any transaction or series of
related transactions, whether or not in the ordinary course of business, with
any Affiliate of Holdings or any of its Subsidiaries, other than in the ordinary
course of business and on terms and conditions substantially as favorable to
Holdings or such Subsidiary as would reasonably be obtained by Holdings or such
Subsidiary at that time in a comparable arm's-length transaction with a Person
other than an Affiliate, except that:
(i) Dividends may be paid to the extent provided in Section 9.03;
(ii) loans may be made and other transactions may be entered into
by the Borrower and its Subsidiaries to the extent permitted by Sections
9.02, 9.04 and 9.05;
(iii) customary fees, indemnities and reimbursements may be paid to
non-officer directors of Holdings;
(iv) Holdings and its Subsidiaries may enter into and make payments
pursuant to employment arrangements with executive officers and senior
management employees in the ordinary course of business;
(v) Holdings and its Subsidiaries may make payments pursuant to
employment agreements existing on the Initial Borrowing Date;
(vi) Holdings and its Subsidiaries may make payments pursuant to
the Tax Sharing Agreements; and
(vii) Holdings may enter into management agreements with the
Borrower and its Subsidiaries and AIPCF Management Fees may be paid so long
as no Default or Event of Default shall exist at the time of such payment.
Except as specifically provided above, no management or similar fees
shall be paid or payable by Holdings or any of its Subsidiaries to any Person
other than the Borrower.
9.07 CAPITAL EXPENDITURES. (a) Holdings will not, and will not
permit any of its Subsidiaries to, make any Capital Expenditures, except that
during any fiscal period set forth below (taken as one accounting period) the
Borrower and its Subsidiaries may make Capital
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Expenditures so long as the aggregate amount of such Capital Expenditures made
under this Section 9.07(a) does not exceed in any period set forth below the
amount set forth opposite such period below:
PERIOD AMOUNT
------ ------
Initial Borrowing Date to $10,000,000
and including the last day
of the Fiscal Year ending
December 31, 1998
Fiscal Year ending $10,000,000
December 31, 1999
Fiscal Year ending $11,000,000
December 31, 2000
Fiscal Year ending $12,000,000
December 31, 2001
Fiscal Year ending $13,000,000
December 31, 2002
Fiscal Year ending $14,000,000
December 31, 2003
Fiscal Year ending $15,000,000
December 31, 2004
Fiscal Year ending $15,000,000
December 31, 2005
January 1, 2006 to and $15,000,000
including the C Term
Maturity Date
(b) In addition to the Capital Expenditures permitted pursuant to
preceding clause (a) above, to the extent that the Capital Expenditures made by
the Borrower and its Subsidiaries in any period set forth in clause (a) above
are less than the amount permitted to be made in such period (without giving
effect to any additional amount available as a result of this clause (b) or
clauses (c) or (d) below), the amount of such difference may be carried forward
and used to make Capital Expenditures in the two succeeding fiscal years of the
Borrower.
(c) In addition to the Capital Expenditures permitted pursuant to
preceding clauses (a) and (b), the Borrower and its Subsidiaries may make
additional Capital Expenditures consisting of (i) the reinvestment of Net Sale
Proceeds of Asset Sales not required to be applied
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to prepay the Loans pursuant to Section 4.02(A)(g) as a result of the proviso
contained therein, (ii) the reinvestment of proceeds of Recovery Events not
required to be applied to repay the Loans pursuant to Section 4.02(A)(i),
(iii) the reinvestment of the amounts of Excess Cash Flow (x) not required to be
applied to repay the Loans pursuant to Section 4.02(A)(h), (y) not used to make
acquisition pursuant to Section 9.02(xiv) or (z) not used to make investments
pursuant to Section 9.05(ix).
9.08 ADJUSTED LEVERAGE RATIO. Holdings and the Borrower will not
permit the Adjusted Leverage Ratio at any time during a period set forth below
to be greater than the ratio set forth opposite such period below:
PERIOD RATIO
------ -----
Fiscal quarter ended September 30, 1998 5.75 to 1
Fiscal quarter ended December 31, 1998 5.75 to 1
Fiscal quarter ended March 31, 1999 5.75 to 1
Fiscal quarter ended June 30, 1999 5.75 to 1
Fiscal quarter ended September 30, 1999 5.75 to 1
Fiscal quarter ended December 31, 1999 5.75 to 1
Fiscal quarter ended March 31, 2000 5.50 to 1
Fiscal quarter ended June 30, 2000 5.50 to 1
Fiscal quarter ended September 30, 2000 5.50 to 1
Fiscal quarter ended December 31, 2000 5.50 to 1
Fiscal quarter ended March 31, 2001 5.50 to 1
Fiscal quarter ended June 30, 2001 5.50 to 1
Fiscal quarter ended September 30, 2001 5.50 to 1
Fiscal quarter ended December 31, 2001 5.50 to 1
Fiscal quarter ended March 31, 2002 5.25 to 1
Fiscal quarter ended June 30, 2002 5.25 to 1
Fiscal quarter ended September 30, 2002 5.25 to 1
Fiscal quarter ended December 31, 2002 5.25 to 1
Fiscal quarter ended March 31, 2003 5.00 to 1
Fiscal quarter ended June 30, 2003 5.00 to 1
Fiscal quarter ended September 30, 2003 5.00 to 1
Fiscal quarter ended December 31, 2003 5.00 to 1
Fiscal quarter ended March 31, 2004 5.00 to 1
Fiscal quarter ended June 30, 2004 5.00 to 1
Fiscal quarter ended September 30, 2004 5.00 to 1
Fiscal quarter ended December 31, 2004 5.00 to 1
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Fiscal quarter ended March 31, 2005 5.00 to 1
Fiscal quarter ended June 30, 2005 5.00 to 1
Fiscal quarter ended September 30, 2005 5.00 to 1
Fiscal quarter ended December 31, 2005 5.00 to 1
Fiscal quarter ended March 31, 2006 5.00 to 1
9.09 INTEREST COVERAGE RATIO. Holdings and the Borrower will not
permit the Interest Coverage Ratio for any period of four consecutive fiscal
quarters, in each case taken as one accounting period, ended on the last day of
any fiscal quarter set forth below to be less than the amount set forth opposite
such fiscal quarter below:
FISCAL QUARTER RATIO
-------------- -----
Fiscal quarter ended September 30, 1998 1.75 to 1
Fiscal quarter ended December 31, 1998 1.75 to 1
Fiscal quarter ended March 31, 1999 1.75 to 1
Fiscal quarter ended June 30, 1999 1.75 to 1
Fiscal quarter ended September 30, 1999 1.75 to 1
Fiscal quarter ended December 31, 1999 1.75 to 1
Fiscal quarter ended March 31, 2000 1.85 to 1
Fiscal quarter ended June 30, 2000 1.85 to 1
Fiscal quarter ended September 30, 2000 1.85 to 1
Fiscal quarter ended December 31, 2000 1.85 to 1
Fiscal quarter ended March 31, 2001 1.95 to 1
Fiscal quarter ended June 30, 2001 1.95 to 1
Fiscal quarter ended September 30, 2001 1.95 to 1
Fiscal quarter ended December 31, 2001 1.95 to 1
Fiscal quarter ended March 31, 2002 2.00 to 1
Fiscal quarter ended June 30, 2002 2.00 to 1
Fiscal quarter ended September 30, 2002 2.00 to 1
Fiscal quarter ended December 31, 2002 2.00 to 1
Fiscal quarter ended March 31, 2003 2.00 to 1
Fiscal quarter ended June 30, 2003 2.00 to 1
Fiscal quarter ended September 30, 2003 2.00 to 1
Fiscal quarter ended December 31, 2003 2.00 to 1
Fiscal quarter ended March 31, 2004 2.00 to 1
Fiscal quarter ended June 30, 2004 2.00 to 1
Fiscal quarter ended September 30, 2004 2.00 to 1
Fiscal quarter ended December 31, 2004 2.00 to 1
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Fiscal quarter ended March 31, 2005 2.00 to 1
Fiscal quarter ended June 30, 2005 2.00 to 1
Fiscal quarter ended September 30, 2005 2.00 to 1
Fiscal quarter ended December 31, 2005 2.00 to 1
Fiscal quarter ended March 31, 2006 2.00 to 1
9.10 LIMITATION ON MODIFICATIONS OF CERTIFICATE OF INCORPORATION,
BY-LAWS AND CERTAIN OTHER AGREEMENTS; LIMITATIONS OF PREPAYMENTS AND
MODIFICATIONS OF INDEBTEDNESS; ETC. Holdings will not, and will not permit any
of its Subsidiaries to (i) make (or give any notice with respect of) any
voluntary or optional payment or prepayment on or redemption or acquisition for
value of (including, without limitation, by way of depositing with the trustee
with respect thereto money or securities before due for the purpose of paying
when due), after the issuance thereof, any Holdings Debentures or any Senior
Subordinated Notes, (ii) amend or modify, or permit the amendment or
modification of any provision of the foregoing Indebtedness (including, without
limitation, the Senior Subordinated Note Documents and the Holdings Financing
Documents), or (iii) amend, modify or change its Certificate of Incorporation
(including, without limitation, by the filing or modification of any certificate
of designation) or By-Laws, other than any amendments, modifications or changes
which would not be reasonably likely to be materially adverse to the interest of
the Banks.
9.11 LIMITATION ON CERTAIN RESTRICTIONS ON SUBSIDIARIES. Holdings
will not, and will not permit any of its Subsidiaries to, directly or
indirectly, create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any such Subsidiary to (a) pay
dividends or make any other distributions on its capital stock or any other
interest or participation in its profits owned by Borrower or any Subsidiary of
the Borrower, or pay any Indebtedness owed to the Borrower or any Subsidiary of
the Borrower, (b) make loans or advances to the Borrower or any Subsidiary of
the Borrower or (c) transfer any of its properties or assets to the Borrower or
any Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this Agreement, the
other Credit Documents and the Transaction Documents, (iii) customary provisions
restricting subletting or assignment of any lease governing a leasehold interest
of the Borrower or any Subsidiary of the Borrower, (iv) customary provisions
restricting assignment of any licensing agreement entered into by the Borrower
or any Subsidiary of the Borrower in the ordinary course of business, (v) the
Credit Agreement, dated February 4, 1997, between Copetro, Banca Nazionale del
Lavoro S.A. and any other bank party thereto (as amended, restated, refinanced,
renewed or replaced), (vi) Indebtedness of the Borrower or any Domestic
Subsidiary permitted under Section 9.04 to the extent no more restrictive, taken
as a whole, than this Agreement and (vii) Foreign Subsidiary Indebtedness.
9.12 LIMITATION ON ISSUANCE OF CAPITAL STOCK. (a) Holdings will not
issue (i) any preferred stock or (ii) any class of redeemable common stock.
(b) The Borrower will not issue, or permit any of its Subsidiaries to
issue, any capital stock (including by way of sales of treasury stock) or any
options or warrants to purchase, or securities convertible into, capital stock,
except (i) for transfers and replacements of then
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outstanding shares of capital stock, (ii) for stock splits, stock dividends and
similar issuances which do not decrease the percentage ownership of Holdings or
any of its Subsidiaries in any class of the capital stock of the Borrower or
such Subsidiary, (iii) to qualify directors to the extent required by applicable
law, (iv) the Borrower may issue additional shares of common stock to Holdings,
so long as all such shares are promptly delivered to the Collateral Agent and
pledged pursuant to the Pledge Agreement and (v) in connection with the creation
of Subsidiaries of the Borrower in compliance with Section 9.14.
9.13 BUSINESS. (a) Holdings shall engage in no types of business
and shall have no material assets or material liabilities, other than its
ownership of the capital stock of the Borrower and liabilities incident thereto,
liabilities under or related to the Holdings Debentures, and liabilities not
prohibited under this Agreement.
(b) The Borrower will not, and will not permit any of its
Subsidiaries to, engage (directly or indirectly) in any business other than the
type of business in which the Borrower and its Subsidiaries are engaged on the
Effective Date and reasonable extensions thereof.
9.14 LIMITATION ON CREATION OF SUBSIDIARIES. Holdings shall not
directly establish, create or acquire any additional Subsidiaries after the
Initial Borrowing Date, other than with the written consent of the
Administrative Agent and the Required Banks. The Borrower may establish, create
or acquire subsidiaries after the Initial Borrowing Date in compliance with
Section 8.11.
9.15 NO OTHER DESIGNATED SENIOR INDEBTEDNESS. Holdings will not, and
will not permit any Subsidiary to, create or permit the creation after the
Initial Borrowing Date of, any class of "Designated Senior Indebtedness" as
defined in the Senior Subordinated Note Documents other than the Obligations.
SECTION 10. EVENTS OF DEFAULT. Upon the occurrence of any of the
following specified events (each an "Event of Default"):
10.01 PAYMENTS. The Borrower shall (i) default in the payment when
due of any principal of any Loan or any Note or (ii) default, and such default
shall continue unremedied for three or more Business Days, in the payment when
due of any Unpaid Drawings or interest on any Loan or Note, or any Fees or any
other amounts owing hereunder, thereunder or under any other Credit Document; or
10.02 REPRESENTATIONS, ETC. Any representation, warranty or
statement made by any Credit Party herein or in any other Credit Document or in
any certificate delivered pursuant hereto or thereto shall prove to be untrue in
any material respect on the date as of which made or deemed made; or
10.03 COVENANTS. Holdings or the Borrower shall (i) default in the
due performance or observance by it of any term, covenant or agreement contained
in Section 8.01(g)(i), 8.07 or Section 9 or (ii) default in the due performance
or observance by it of any other term, covenant or agreement contained in this
Agreement (other than as described in
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Section 10.01, 10.02 or 10.03(i)), and such default shall continue unremedied
for a period of 30 days after written notice to the Borrower by the
Administrative Agent or any Bank; or
10.04 DEFAULT UNDER OTHER AGREEMENTS. Holdings or any of its
Subsidiaries shall (i) default in any payment of any Indebtedness (other than
the Obligations) beyond the period of grace, if any, provided in the instrument
or agreement under which such Indebtedness was created or (ii) default in the
observance or performance of any agreement or condition relating to any
Indebtedness (other than the Obligations) or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other event shall
occur or condition exist, the effect of which default or other event or
condition is to cause, or to permit the holder or holders of such Indebtedness
(or a trustee or agent on behalf of such holder or holders) to cause (determined
without regard to whether any notice is required), any such Indebtedness to
become due prior to its stated maturity, or (iii) any Indebtedness (other than
the Obligations) of Holdings or any of its Subsidiaries shall be declared to be
due and payable, or required to be prepaid other than by a regularly scheduled
required prepayment, prior to the stated maturity thereof, PROVIDED that (x) it
shall not be a Default or Event of Default under this Section 10.04 unless the
aggregate principal amount of all Indebtedness as described in preceding clauses
(i) through (iii), inclusive, is at least $5,000,000; or
10.05 BANKRUPTCY, ETC. Holdings or any of its Significant
Subsidiaries shall commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or hereafter in effect, or
any successor thereto (the "Bankruptcy Code"); or an involuntary case is
commenced against Holdings or any of its Significant Subsidiaries and the
petition is not controverted within 10 days, or is not dismissed within 60 days,
after commencement of the case; or a custodian (as defined in the Bankruptcy
Code) is appointed for, or takes charge of, all or substantially all of the
property of Holdings or any of its Significant Subsidiaries, or Holdings or any
of its Significant Subsidiaries commences any other proceeding under any
reorganization, arrangement, adjustment of debt, relief of debtors, dissolution,
insolvency or liquidation or similar law of any jurisdiction whether now or
hereafter in effect relating to Holdings or any of its Significant Subsidiaries,
or there is commenced against Holdings or any of its Significant Subsidiaries
any such proceeding which remains undismissed for a period of 60 days, or
Holdings or any of its Significant Subsidiaries is adjudicated insolvent or
bankrupt; or any order of relief or other order approving any such case or
proceeding is entered; or Holdings or any of its Significant Subsidiaries
suffers any appointment of any custodian or the like for it or any substantial
part of its property to continue undischarged or unstayed for a period of 60
days; or Holdings or any of its Significant Subsidiaries makes a general
assignment for the benefit of creditors; or any corporate action is taken by
Holdings or any of its Significant Subsidiaries for the purpose of effecting any
of the foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the minimum funding
standard required for any plan year or part thereof or a waiver of such standard
or extension of any amortization period is sought or granted under Section 412
of the Code, any Plan shall have had or, in the reasonable opinion of the
Required Banks, is likely to have a trustee appointed to administer such Plan,
any Plan is, shall have been or is likely to be terminated or to be the subject
of termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made to a Plan has not been made,
Holdings, the Borrower or any of
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their respective Subsidiaries or any ERISA Affiliate has incurred or is likely
to incur a liability to or on account of a Plan under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section
401(a)(29), 4971 or 4975 of the Code, or Holdings, the Borrower or any of their
respective Subsidiaries has incurred or is likely to incur liabilities pursuant
to one or more employee welfare benefit plans (as defined in Section 3(1) of
ERISA) which provide benefits to retired employees or other former employees
(other than as required by Section 601 of ERISA) or employee pension benefit
plans (as defined in Section 3(2) of ERISA); (b) there shall result from any
such event or events the imposition of a lien, the granting of a security
interest, or a liability or a material risk of incurring a liability; and in
each case in clauses (a) and (b) above, such lien, security interest or
liability, in the reasonable opinion of the Required Banks, will have a material
adverse effect upon the business, operations, property, assets, liabilities or
condition (financial or otherwise) of Holdings, the Borrower or of Holdings and
its Subsidiaries taken as a whole; or
10.07 SECURITY DOCUMENTS. At any time after the execution and
delivery thereof, any of the Security Documents shall cease to be in full force
and effect, or shall cease in any material respect to give the Collateral Agent
for the benefit of the Secured Creditors the Liens, rights, powers and
privileges purported to be created thereby (including, without limitation, a
perfected security interest in, and Lien on, all of the Collateral), in favor of
the Collateral Agent, superior to and prior to the rights of all third Persons
(except as permitted by Section 9.01), and subject to no other Liens (except as
permitted by Section 9.01), or any Credit Party shall default in the due
performance or observance of any term, covenant or agreement on its part to be
performed or observed pursuant to any of the Security Documents and such default
shall continue beyond any grace period specifically applicable thereto pursuant
to the terms of such Security Document; or
10.08 GUARANTY. Any Guaranty or any provision thereof shall cease to
be in full force or effect as to the relevant Guarantor or other party
thereunder (other than in accordance with the express terms thereof) or any
Guarantor or other party thereunder or Person acting by or on behalf of such
Guarantor or such party shall deny or disaffirm such Guarantor's or such party's
obligations under the relevant Guaranty, or any Guarantor or such party shall
default in the due performance or observance of any term, covenant or agreement
on its part to be performed or observed pursuant to any Guaranty; or
10.09 JUDGMENTS. One or more judgments or decrees shall be entered
against Holdings or any of its Subsidiaries involving in the aggregate for
Holdings and its Subsidiaries a liability (not paid or fully covered by a
reputable and solvent insurance company) and such judgments and decrees either
shall be final and non-appealable or shall not be vacated, discharged or stayed
or bonded pending appeal for any period of 60 consecutive days, and the
aggregate amount of all such judgments exceeds $7,500,000; or
10.10 CHANGE OF CONTROL. A Change of Control shall occur;
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then, and in any such event, and at any time thereafter, if any Event of Default
shall then be continuing, the Administrative Agent, upon the written request of
the Required Banks, shall by written notice to the Borrower, take any or all of
the following actions, without prejudice to the rights of the Administrative
Agent, any Bank or the holder of any Note to enforce its claims against any
Credit Party (PROVIDED that, if an Event of Default specified in Section 10.05
shall occur with respect to the Borrower, the result which would occur upon the
giving of written notice by the Administrative Agent to the Borrower as
specified in clauses (i) and (ii) below shall occur automatically without the
giving of any such notice): (i) declare the Total Commitments terminated,
whereupon all Commitments of each Bank shall forthwith terminate immediately and
any Commitment Commission shall forthwith become due and payable without any
other notice of any kind; (ii) declare the principal of and any accrued interest
in respect of all Loans and the Notes and all Obligations owing hereunder and
thereunder to be, whereupon the same shall become, forthwith due and payable
without presentment, demand, protest or other notice of any kind, all of which
are hereby waived by each Credit Party; (iii) terminate any Letter of Credit
which may be terminated in accordance with its terms; (iv) direct the Borrower
to pay (and the Borrower agrees that upon receipt of such notice, or upon the
occurrence of an Event of Default specified in Section 10.05 with respect to the
Borrower, it will pay) to the Collateral Agent at the Payment Office such
additional amount of cash, to be held as security by the Collateral Agent, as is
equal to the aggregate Stated Amount of all Letters of Credit issued for the
account of the Borrower and then outstanding; (v) enforce, as Collateral Agent,
all of the Liens and security interests created pursuant to the Security
Documents and (vi) apply any cash collateral held pursuant to Section 4.02(A) in
satisfaction of the Obligations.
SECTION 11. Definitions and Accounting Terms.
11.01 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):
"A Term Loan" shall have the meaning provided in Section 1.01(a).
"A Term Loan Commitments" shall mean for each Bank the amount set
forth opposite such Bank's name in Schedule I hereto in the column entitled "A
Term Loan Commitment" as same may be (x) reduced from time to time pursuant to
Sections 3.03, 4.02(A) and/or 10 or (y) adjusted from time to time as a result
of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"A Term Loan Scheduled Repayments" shall have the meaning provided in
Section 4.02(A)(b).
"A Term Maturity Date" shall mean May 31, 2004.
"A Term Notes" shall have the meaning provided in Section 1.05(a).
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"Additional Collateral" shall mean all property (whether real or
personal) in which security interests are granted (or have been purported to be
granted) (and continue to be in effect at the time of determination) pursuant to
Section 8.11.
"Additional Mortgage" shall have the meaning provided in Section
8.11(b).
"Additional Mortgaged Property" shall have the meaning provided in
Section 8.11(b).
"Additional Security Documents" shall mean all mortgages, pledge
agreements, security agreements and other security documents entered into
pursuant to Section 8.11 with respect to Additional Collateral.
"Adjusted Certificate of Deposit Rate" shall mean, on any day, the sum
(rounded to the nearest 1/100 of 1%) of (1) the rate obtained by dividing (x)
the most recent weekly average dealer offering rate for negotiable certificates
of deposit with a three-month maturity in the secondary market as published in
the most recent Federal Reserve System publication entitled "Select Interest
Rates," published weekly on Form H.15 as of the date hereof, or if such
publication or a substitute containing the foregoing rate information shall not
be published by the Federal Reserve System for any week, the weekly average
offering rate determined by the Administrative Agent on the basis of quotations
for such certificates received by it from three certificate of deposit dealers
in New York of recognized standing or, if such quotations are unavailable, then
on the basis of other sources reasonably selected by the Administrative Agent,
by (y) a percentage equal to 100% minus the stated maximum rate of all reserve
requirements as specified in Regulation D applicable on such day to a
three-month certificate of deposit of a member bank of the Federal Reserve
System in excess of $100,000 (including, without limitation, any marginal,
emergency, supplemental, special or other reserves), plus (2) the then daily net
annual assessment rate as estimated by the Administrative Agent for determining
the current annual assessment payable by the Administrative Agent to the Federal
Deposit Insurance Corporation for insuring three-month certificates of deposit.
"Adjusted Consolidated EBITDA" for any period shall mean (i)
Consolidated EBITDA for such period plus (ii) the principal amount of Senior
Subordinated Notes issued in lieu of interest during such period PROVIDED that
in the event Holdings, the Borrower or any Subsidiary of Holdings acquired any
Person during such period, Adjusted Consolidated EBITDA for such period shall be
calculated on a pro forma basis, based on the actual historical results of such
acquired Person as if such Person had been acquired on the first day of such
period.
"Adjusted Consolidated Net Income" for any period shall mean
Consolidated Net Income for such period plus, to the extent deducted in
computing such Consolidated Net Income, without duplication, the sum of the
amount of (i) all net non-cash charges (including, without limitation,
depreciation, amortization, deferred tax expense, non-cash interest expense and
non-cash items) resulting from purchase accounting adjustments, (ii) income tax
expense and withholding tax expense incurred in connection with cross-border
transactions involving Foreign Subsidiaries, (iii) any special charges
(including any non-cash fees or expenses) incurred in connection with the Merger
and the Transaction, (iv) AIPCF Management Fees and other
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amounts paid to AIPCF or its Affiliates pursuant to Section 9.03 and 9.06, (v)
non-cash exchange, translation or performance losses relating to any foreign
currency hedging transactions or currency fluctuations, and (vi) net non-cash
losses which were included in arriving at Consolidated Net Income for such
period less the sum of the amount of all net non-cash gains (exclusive of such
non-cash items reflected in Adjusted Consolidated Working Capital) included in
arriving at Consolidated Net Income for such period; PROVIDED that in the event
Holdings, the Borrower or any Subsidiary of Holdings acquired any Person during
such period, Adjusted Consolidated Net Income for such period shall be
calculated on a pro forma basis, based on the actual historical results of such
acquired Person as if such Person had been acquired on the first day of such
period.
"Adjusted Consolidated Working Capital" at any time shall mean
Consolidated Current Assets (but excluding therefrom all cash and Cash
Equivalents) less Consolidated Current Liabilities.
"Adjusted Leverage Ratio" shall mean on the date of determination
thereof the ratio of (i) Consolidated Indebtedness on such date to (ii) Adjusted
Consolidated EBITDA (which shall be calculated for any period ending prior to
June 30, 1999, by using the following amounts for such following periods:
fiscal quarter ended June 30, 1997, $13,807,000; fiscal quarter ended
September 30, 1997, $15,160,000; fiscal quarter ended December 31, 1997,
$17,001,000; and fiscal quarter ended March 31, 1998, $16,528,000 for the Test
Period ended on the last day of any fiscal quarter last ended prior to the date
such determination is made.
"Adjusted Percentage" shall mean (x) at a time when no Bank Default
exists, for each Bank, such Bank's Percentage and (y) at a time when a Bank
Default exists (i) for each Bank that is a Defaulting Bank, zero and (ii) for
each Bank that is a Non-Defaulting Bank, the percentage determined by dividing
in the case of such Bank's Percentage, such Bank's Revolving Loan Commitment at
such time by the Adjusted Total Revolving Loan Commitment at such time, it being
understood that all references herein to Revolving Loan Commitments and the
Adjusted Total Revolving Loan Commitment at a time when the Total Revolving Loan
Commitment or Adjusted Total Revolving Loan Commitment, as the case may be, has
been terminated shall be references to the Revolving Loan Commitments or
Adjusted Total Revolving Loan Commitment, as the case may be, in effect
immediately prior to such termination, PROVIDED that (A) no Bank's Adjusted
Percentage shall change upon the occurrence of a Bank Default from that in
effect immediately prior to such Bank Default if after giving effect to such
Bank Default, and any repayment of Revolving Loans at such time pursuant to
Section 4.02(A)(a) or otherwise, the sum of the aggregate outstanding principal
amount of Revolving Loans of all Non-Defaulting Banks plus the then outstanding
Swingline Loans and the Letter of Credit Outstandings, exceed the Adjusted Total
Revolving Loan Commitment; (B) the changes to the Adjusted Percentage that would
have become effective upon the occurrence of a Bank Default but that did not
become effective as a result of the preceding clause (A) shall become effective
on the first date after the occurrence of the relevant Bank Default on which the
sum of the aggregate outstanding principal amount of the Revolving Loans of all
Non-Defaulting Banks plus the then outstanding Swingline Loans and the Letter of
Credit Outstandings is equal to or less than the Adjusted Total Revolving Loan
Commitment; and (C) if (i) a Non-Defaulting Bank's Adjusted Percentage is
changed pursuant to the preceding clause (B) and (ii) any repayment of such
Bank's Revolving Loans or of
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Swingline Loans or of Unpaid Drawings with respect to Letters of Credit, that
were made during the period commencing after the date of the relevant Bank
Default and ending on the date of such change to its Adjusted Percentage must be
returned to the Borrower as a preferential or similar payment in any bankruptcy
or similar proceeding of the Borrower, then the change to such Non-Defaulting
Bank's Adjusted Percentage effected pursuant to said clause (B) shall be reduced
to that positive change, if any, as would have been made to its Adjusted
Percentage if (x) such repayments had not been made and (y) the maximum change
to its Adjusted Percentage would have resulted in the sum of the outstanding
principal of Revolving Loans made by such Bank plus such Bank's new Adjusted
Percentage of the then outstanding Swingline Loans and the outstanding principal
amount of Letter of Credit Outstandings equaling such Bank's Revolving Loan
Commitment at such time.
"Adjusted Total Revolving Loan Commitment" shall mean at any time the
Total Revolving Loan Commitment less the aggregate Revolving Loan Commitments of
all Defaulting Banks at such time.
"Administrative Agent" shall mean Bankers Trust Company, in its
capacity as Administrative Agent for the Banks hereunder, and shall include any
successor to the Administrative Agent appointed pursuant to Section 12.09.
"Affected Eurodollar Loans" shall have the meaning provided in Section
4.02(A)(k).
"Affiliate" shall mean, with respect to any Person, any other Person
(including for purposes of Section 9.06 only, all directors, officers and
partners of such Person) directly or indirectly controlling, controlled by, or
under direct or indirect common control with, such Person; PROVIDED, HOWEVER,
that for purposes of Section 9.06, an Affiliate of Holdings shall include any
Person that directly or indirectly owns more than 10% of any class of the
capital stock of Holdings. A Person shall be deemed to control another Person
if such Person possesses, directly or indirectly, the power to direct or cause
the direction of the management and policies of such other Person, whether
through the ownership of voting securities, by contract or otherwise.
"Agreement" shall mean this Credit Agreement, as amended, modified,
extended, renewed, replaced, restated or supplemented from time to time.
"AIPCF" shall mean American Industrial Partners Capital Fund II, L.P.
"AIPCF Management Fee" shall mean payment by Holdings or its
Subsidiaries of a management fee in an amount not to exceed $1.85 million in any
fiscal year and the reimbursement by Holdings or its Subsidiaries of AIPCF's
reasonable out of pocket expenses incurred in connection with the rendering of
management services to or on behalf of Holdings or its Subsidiaries.
"Anticipated Reinvestment Amount" shall mean, with respect to any
Reinvestment Election, the amount specified in the Reinvestment Notice delivered
by the Borrower in connection therewith as the amount of Net Sale Proceeds from
the related Asset Sale that the
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Borrower and/or its Subsidiaries intend to use to purchase, construct or
otherwise acquire Reinvestment Assets.
"Applicable Margin" shall mean a percentage per annum equal to, in the
case of (i) A Term Loans and Revolving Loans and Swingline Loans which are
maintained as (x) Base Rate Loans, 1.25% and (y) Eurodollar Loans, 2.25%,
reduced in each case by the applicable Interest Reduction Discount, (ii) in the
case of B Term Loans that are maintained (x) as Base Rate Loans, 1.75%, and (y)
Eurodollar Loans, 2.75%, reduced in each case by the applicable Interest
Reduction Discount and (iii) in the case of C Term Loans that are maintained as
(x) Base Rate Loans, 2.00% and (y) Eurodollar Loans, 3.00%, reduced in each case
by the applicable Interest Reduction Discount.
"Asset Sale" shall mean the sale, transfer or other disposition by
Holdings or any of its Subsidiaries to any Person other than Holdings or any of
its Subsidiaries of any asset of Holdings or such Subsidiary (other than sales,
transfers or other dispositions (a) in the ordinary course of business of goods
or inventory and/or obsolete or excess equipment or intellectual property, (b)
the proceeds of which do not exceed $1,000,000 per annum, (c) of accounts
receivable under Section 9.02(xi) or (d) trade or barter transactions entered
into in the ordinary course of business).
"Assignment and Assumption Agreement" shall mean the Assignment and
Assumption Agreement substantially in the form of Exhibit K (appropriately
completed).
"Authorized Officer" of any Credit Party shall mean any of the
Chairman of the Board, the President, the Chief Executive Officer, any Vice
President, the Treasurer, the Secretary, any Assistant Secretary, any Assistant
Treasurer, the Chief Financial Officer or the Controller of such Credit Party or
any other officer of such Credit Party which is designated in writing to the
Administrative Agent, BTCo and the Issuing Bank by any of the foregoing officers
of such Credit Party as being authorized to give such notices under this
Agreement.
"B Bank" shall have the meaning provided in Section 4.02(B).
"B Term Loan" shall have the meaning provided in Section 1.01(b).
"B Term Loan Commitments" shall mean for each Bank the amount set
forth opposite such Bank's name in Schedule I hereto in the column entitled "B
Term Loan Commitment" as same may be (x) reduced from time to time pursuant to
Sections 3.03, 4.02(A) and/or 10 or (y) adjusted from time to time as a result
of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
"B Term Loan Scheduled Repayment" shall have the meaning provided in
Section 4.02(A)(c).
"B Term Maturity Date" shall mean May 31, 2005.
"B Term Notes" shall have the meaning provided in Section 1.05(a).
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"Bank" shall mean each financial institution listed on Schedule I, as
well as any Person which becomes a "Bank" hereunder pursuant to Sections 1.13
and 13.04(b).
"Bank Default" shall mean (i) the refusal (which has not been
retracted) of a Bank to make available its portion of any Borrowing (including a
Mandatory Borrowing) or to fund its portion of any unreimbursed payment under
Section 2.03(c) or (ii) a Bank having notified in writing the Borrower and/or
the Administrative Agent that it does not intend to comply with its obligations
under Section 1.01(d) or Section 2.
"Bankruptcy Code" shall have the meaning provided in Section 10.05.
"Base Rate" at any time shall mean the highest of (i) 1/2 of 1% in
excess of the Adjusted Certificate of Deposit Rate and (ii) the Prime Lending
Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and (ii) each Loan
designated or deemed designated as such by the Borrower at the time of the
incurrence thereof or conversion thereto.
"Borrower" shall have the meaning provided in the first paragraph of
this Agreement.
"Borrowing" shall mean the borrowing of one Type of Loan of a single
Tranche from all the Banks having Commitments of the respective Tranche (or from
the Swingline Bank in the case of Swingline Loans) on a given date (or resulting
from a conversion or conversions on such date) having in the case of Eurodollar
Loans the same Interest Period, PROVIDED that Base Rate Loans incurred pursuant
to Section 1.10(b) shall be considered part of the related Borrowing of
Eurodollar Loans.
"BTCo" shall mean Bankers Trust Company in its individual capacity.
"Business Day" shall mean (i) for all purposes other than as covered
by clause (ii) below, any day except Saturday, Sunday and any day which shall be
in New York City a legal holiday or a day on which banking institutions are
authorized or required by law or other government action to close and (ii) with
respect to all notices and determinations in connection with, and payments of
principal and interest on, Eurodollar Loans, any day which is a Business Day
described in clause (i) above and which is also a day for trading by and between
banks in the New York interbank Eurodollar market.
"C Bank" shall have the meaning provided in Section 4.02(B).
"C Term Loan" shall have the meaning provided in Section 1.01(c).
"C Term Loan Commitments" shall mean for each Bank the amount set
forth opposite such Bank's name in Schedule I hereto in the column entitled "C
Term Loan Commitment" as same may be (x) reduced from time to time pursuant to
Sections 3.03, 4.02(A) and/or 10 or (y) adjusted from time to time as a result
of assignments to or from such Bank pursuant to Section 1.13 or 13.04(b).
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"C Term Loan Scheduled Repayments" shall have the meaning provided in
Section 4.02(A)(d).
"C Term Maturity Date" shall mean May 31, 2006.
"C Term Notes" shall have the meaning provided in Section 1.05(a).
"Capital Expenditures" shall mean, with respect to any Person, all
expenditures (excluding barter transactions effected in the ordinary course of
business) by such Person which should be capitalized in accordance with GAAP,
including all such expenditures with respect to fixed or capital assets
(including, without limitation, expenditures for maintenance and repairs which
should be capitalized in accordance with GAAP) and the amount of Capitalized
Lease Obligations incurred by such Person (which shall be deemed to include (i)
expenditures by such person to acquire stock or other evidence of beneficial
ownership of any other Person for the purpose of acquiring the capital assets of
such Person and (ii) expenditures for equipment at customers and property
additions; PROVIDED, HOWEVER, that Capital Expenditures for the Borrower and its
Subsidiaries shall not include (a) expenditures to the extent made with the
proceeds of the issuance of capital stock of Holdings after the Initial
Borrowing Date not used to prepay Loans pursuant to Section 4.02(A)(e), (b)
expenditures of the Borrower and its Subsidiaries that are paid for by a third
party and for which neither Holdings nor any Subsidiary of Holdings has provided
or is required to provide or incur, directly or indirectly, any consideration or
obligation to such third party and (c) the book value of any asset owned by the
Borrower and its Subsidiaries prior to or during any relevant period to the
extent that such book value is included as a capital expenditure during such
period as a result of the Borrower and its Subsidiaries reusing or beginning to
reuse such asset during such period without a corresponding expenditure actually
having been made in such period.
"Capitalized Lease Obligations" of any Person shall mean all rental
obligations which, under GAAP, are or will be required to be capitalized on the
books of such Person, in each case taken at the amount thereof accounted for as
indebtedness in accordance with GAAP.
"Cash Equivalents" shall mean, as to any Person, (i) securities issued
or directly and fully guaranteed or insured by the United States or any agency
or instrumentality thereof (PROVIDED that the full faith and credit of the
United States is pledged in support thereof) having maturities of not more than
one year from the date of acquisition, (ii) time deposits and certificates of
deposit of any commercial bank having, or which is the principal banking
subsidiary of a bank holding company organized under the laws of the United
States, any State thereof, the District of Columbia or any foreign jurisdiction
having capital, surplus and undivided profits aggregating in excess of
$200,000,000, with maturities of not more than one year from the date of
acquisition by such Person, (iii) repurchase obligations with a term of not more
than 90 days for underlying securities of the types described in clause (i)
above entered into with any bank meeting the qualifications specified in clause
(ii) above, (iv) commercial paper issued by any Person incorporated in the
United States rated at least A-1 or the equivalent thereof by Standard & Poor's
Corporation or at least P-1 or the equivalent thereof by Xxxxx'x Investors
Service, Inc. and in each case maturing not more than one year after the date of
acquisition by such Person, (v) investments in money market funds substantially
all of whose assets are comprised of securities of
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the types described in clauses (i) through (iv) above, (vi) demand deposit
accounts maintained in the ordinary course of business not in excess of
$1,000,000 in the aggregate and (vii) in the case of any Foreign Subsidiary; (a)
direct obligations of the sovereign nation (or any agency thereof) in which such
Foreign Subsidiary is organized and is conducting business or in obligations
fully and unconditionally guaranteed by such sovereign nation (or any agency
thereof), (b) investments of the type and maturity described in clauses (i)
through (v) above of foreign obligors, which investments or obligors (or the
direct or indirect parents of such obligors) have ratings described in such
clauses or equivalent ratings from comparable foreign rating agencies or (c)
investments of the type and maturity described in clauses (i) through (v) above
of foreign obligors (or the direct or indirect parents of such obligors), which
investments or obligors (or the direct or indirect parents of such obligors) are
not rated as provided in such clauses or in clause (b) above but which are, in
the reasonable judgment of Holdings or its Subsidiaries, comparable in
investment quality to such investment and obligors (or the direct or indirect
parent of such obligors).
"Change of Control" shall mean such time as (i) Holdings shall cease
to own 100% of the capital stock of the Borrower, (ii) prior to the initial
public offering by Holdings of its common stock (other than a public offering
pursuant to a registration statement on Form S-8), American Industrial Partners,
AIPCF or any of their respective Affiliates (collectively, the "Initial
Investors") cease to be, directly or indirectly, the beneficial owners, in the
aggregate, of a majority of the voting power of the Voting Stock and a majority
of the economic interests in all capital stock of Holdings or (iii) after the
initial public offering by Holdings of its common stock (other than a public
offering pursuant to a registration statement on Form S-8), (A) any Schedule
13D, Form 13F or Schedule 13G under the Exchange Act, or any amendment to such
Schedule or Form, is received by Holdings which indicates that, or Holdings
otherwise becomes aware that, a "person" or "group" (within the meaning of
sections 13(d) and 14(d)(2) of the Exchange Act) other than the Initial
Investors or their Related Parties (as defined below) has become, directly or
indirectly, the "beneficial owner," by way of merger, consolidation or
otherwise, of 35% or more of the voting power of the Voting Stock of Holdings
and (B) such person or group has become, directly or indirectly, the beneficial
owner of a greater percentage of the Voting Stock and economic interests in all
capital stock of Holdings than beneficially owned by the Initial Investors or
other Related Parties, (iv) during any period of two consecutive calendar years,
individuals who at the beginning of such period constituted the Board of
Directors of Holdings (together with any new directors whose election by the
Board of Directors of Holdings or whose nomination for election by the
stockholders of Holdings was approved by a vote of a majority of the directors
then still in office who either were directors at the beginning of such period
or whose election or nomination for election was previously so approved) cease
for any reason to constitute a majority of the directors of Holdings, then in
office or (v) any "change of control" occurs under any of the Senior
Subordinated Note Documents or Holdings Debenture Documents . "Related Party"
with respect to any Initial Investor means (A) any controlling stockholder, 80%
(or more) owned Subsidiary, or spouse, or immediate family member (in the case
of any individual) of such Initial Investor or (B) any trust, corporation,
partnership or other entity, the beneficiaries, stockholders, partners, owners
or persons beneficially holding an 80% or more controlling interest of which
consist of such Initial Investor and/or such other persons referred to in the
immediately preceding clause (A).
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"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and the regulations promulgated and the rulings issued thereunder.
Section references to the Code are to the Code, as in effect at the date of this
Agreement, and to any subsequent provision of the Code, amendatory thereof,
supplemental thereto or substituted therefor.
"Collateral" shall mean all property (whether real or personal) with
respect to which any security interests have been granted (or purported to be
granted) pursuant to any Security Document, including, without limitation, all
Pledge Agreement Collateral, all Security Agreement Collateral, all Mortgaged
Properties and all cash and Cash Equivalents delivered as collateral pursuant to
Section 4.02(A) or Section 10 hereof and all Additional Collateral, if any.
"Collateral Agent" shall mean the Administrative Agent acting as
collateral agent for the Secured Creditors pursuant to the Security Documents.
"Commitment" shall mean any of the commitments of any Bank, I.E.,
whether the Term Loan Commitments or Revolving Loan Commitment.
"Commitment Commission" shall have the meaning provided in Section
3.01(a).
"Consolidated Current Assets" shall mean, at any time, the
consolidated current assets of Holdings and its Consolidated Subsidiaries
determined on a consolidated basis in accordance with GAAP.
"Consolidated Current Liabilities" shall mean, at any time, the
consolidated current liabilities of Holdings and its Consolidated Subsidiaries
determined on a consolidated basis in accordance with GAAP at such time, but
excluding (i) the current portion of any Indebtedness under this Agreement and
any other long-term Indebtedness which would otherwise be included therein, (ii)
accrued but unpaid interest with respect to the Indebtedness described in clause
(i), and (iii) the current portion of Capitalized Lease Obligations.
"Consolidated EBIT" shall mean, for any period, the Adjusted
Consolidated Net Income of Holdings and its Consolidated Subsidiaries determined
on a consolidated basis in accordance with GAAP, before Consolidated Net
Interest Expense and provision for taxes and without giving effect to any
extraordinary gains or losses; PROVIDED that in the event Holdings, the Borrower
or any Subsidiary of Holdings acquired any Person during such period,
Consolidated EBIT for such period shall be calculated on a pro forma basis,
based on the actual historical results of such acquired Person as if such Person
had been acquired on the first day of such period.
"Consolidated EBITDA" shall mean, for any period, Consolidated EBIT,
adjusted by adding thereto the amount of all depreciation and amortization
charges that were deducted in arriving at Consolidated EBIT for such period;
PROVIDED that in the event Holdings, the Borrower or any Subsidiary of Holdings
acquired any Person during such period, Consolidated EBITDA for such period
shall be calculated on a pro forma basis, based on the actual historical results
of such acquired Person as if such Person had been acquired on the first day of
such period.
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"Consolidated Fixed Charge Coverage Ratio" means, for any period, the
ratio of (x) Consolidated EBITDA for such period to (y) Consolidated Fixed
Charges for such period.
"Consolidated Fixed Charges" means, for any period, the sum, without
duplication, of (i) Consolidated Net Cash Interest Expense for such period, (ii)
the amount of all Capital Expenditures made by the Borrower and its Subsidiaries
for such period (other than Capital Expenditures to the extent financed with
equity proceeds, Asset Sale proceeds, insurance proceeds or Indebtedness (other
than with Revolving Loans), (iii) the scheduled principal amount of all
amortization payments on all Indebtedness (including, without limitation, the
principal component of all Capitalized Lease Obligations) of the Borrower and
its Subsidiaries for such period (as determined on the first day of such
period), (iv) the amount of all cash payments made by the Borrower and its
Subsidiaries in respect of taxes or tax liabilities for such period and (v) the
amount of all Dividends paid by Holdings during such period.
"Consolidated Indebtedness" shall mean, at any time, without
duplication, the sum of the aggregate outstanding principal amount of all
Indebtedness for borrowed money (excluding the principal amount of the Holdings
Debentures), and the principal component of Capitalized Lease Obligations, of
Holdings and its Consolidated Subsidiaries determined on a consolidated basis in
accordance with GAAP.
"Consolidated Net Cash Interest Expense" shall mean, for any period,
the total consolidated cash interest expense of Holdings and its Consolidated
Subsidiaries determined on a consolidated basis in accordance with GAAP for such
period plus, without duplication, that portion of Capitalized Lease Obligations
of Holdings and its Consolidated Subsidiaries representing the interest factor
for such period in each case net of the total consolidated cash interest income
of Holdings, its Consolidated Subsidiaries for such period; PROVIDED that in the
event Holdings, the Borrower or any Subsidiary of Holdings acquired any Person
during such period, Consolidated Net Cash Interest Expense for such period shall
be calculated on a pro forma basis, based on the actual historical results of
such acquired Person as if such Person had been acquired on the first day of
such period.
"Consolidated Net Income" shall mean, for any period, net after tax
income of Holdings and its Consolidated Subsidiaries determined on a
consolidated basis in accordance with GAAP.
"Consolidated Net Interest Expense" shall mean, for any period, the
total consolidated interest expense of Holdings and its Consolidated
Subsidiaries determined on a consolidated basis in accordance with GAAP for such
period (calculated without regard to any limitations on the payment thereof)
plus, without duplication, that portion of Capitalized Lease Obligations of
Holdings and its Consolidated Subsidiaries determined on a consolidated basis in
accordance with GAAP representing the interest factor for such period in each
case net of the total consolidated cash interest income of Holdings and its
Consolidated Subsidiaries for such period, but excluding the amortization of any
deferred financing costs incurred in connection with this Agreement.
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"Consolidated Subsidiaries" shall mean, as to any Person, all
Subsidiaries of such Person which are consolidated with such Person for
financial reporting purposes in accordance with GAAP.
"Contingent Obligation" shall mean, as to any Person, any obligation
of such Person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations ("primary obligations") of any other Person (the
"primary obligor") in any manner, whether directly or indirectly, including,
without limitation, any obligation of such Person, whether or not contingent,
(i) to purchase any such primary obligation or any property constituting direct
or indirect security therefor, (ii) to advance or supply funds (x) for the
purchase or payment of any such primary obligation or (y) to maintain working
capital or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make payment of
such primary obligation or (iv) otherwise to assure or hold harmless the holder
of such primary obligation against loss in respect thereof; PROVIDED, HOWEVER,
that the term Contingent Obligation shall not include endorsements of
instruments for deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount equal to the
stated or determinable amount of the primary obligation in respect of which such
Contingent Obligation is made (or, if less, the maximum amount of such primary
obligation for which such Person may be liable pursuant to the terms of the
instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof
(assuming such Person is required to perform thereunder) as determined by such
Person in good faith.
"Copetro" shall mean Copetro S.A., a corporation organized under the
laws of Argentina.
"Credit Documents" shall mean this Agreement and, after the execution
and delivery thereof pursuant to the terms of this Agreement, each Note, each
Security Document and each Subsidiary Guaranty, if any.
"Credit Event" shall mean the making of any Loan or the issuance of
any Letter of Credit.
"Credit Party" shall mean Holdings, the Borrower and each Subsidiary
thereof party to a Credit Document.
"Default" shall mean any event, act or condition which with notice or
lapse of time, or both, would constitute an Event of Default.
"Defaulting Bank" shall mean any Bank with respect to which a Bank
Default is in effect.
"Dividend" with respect to any Person shall mean that such Person has
declared or paid a dividend or returned any equity capital to its stockholders
or authorized or made any other
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distribution, payment or delivery of property (other than common stock of such
Person) or cash to its stockholders as such, or redeemed, retired, purchased or
otherwise acquired, directly or indirectly, for consideration any shares of any
class of its capital stock outstanding on or after the Effective Date (or any
options or warrants issued by such Person with respect to its capital stock), or
set aside any funds for any of the foregoing purposes, or shall have permitted
any of its Subsidiaries to purchase or otherwise acquire for consideration any
shares of any class of the capital stock of such Person outstanding on or after
the Effective Date (or any options or warrants issued by such Person with
respect to its capital stock). Without limiting the foregoing, "Dividends" with
respect to any Person shall also include all payments made or required to be
made by such Person with respect to any stock appreciation rights, plans, equity
incentive or achievement plans or any similar plans or setting aside of any
funds for the foregoing purposes but shall exclude AIPCF Management Fees.
"Documents" shall mean the Credit Documents and the Transaction
Documents.
"Dollars" and the sign "$" shall each mean freely transferable lawful
money of the United States.
"Domestic Subsidiary" shall mean each Subsidiary that is incorporated
or organized in the United States or any state thereof.
"Drawing" shall have the meaning provided in Section 2.04(b).
"Effective Date" shall have the meaning provided in Section 13.10.
"Eligible Transferee" shall mean and include a commercial bank, mutual
funds, financial institution or other institutional "accredited investor" (as
defined in Regulation D of the Securities Act).
"Employee Stock Option Plan" shall mean any plan, to be entered into
after the Initial Borrowing Date, for the compensation of management of Holdings
or any of its Subsidiaries, or any arrangement for the benefit of management of
Holdings or any of its Subsidiaries, in form and substance reasonably acceptable
to the Administrative Agent.
"End Date" shall have the meaning provided in the definition of
Interest Reduction Discount.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder. Section references to ERISA are to ERISA, as in effect at
the date of this Agreement and any subsequent provisions of ERISA, amendatory
thereof, supplemental thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in Section 3(9)
of ERISA) which together with the Borrower or any Subsidiary of the Borrower
would be deemed to be a "single employer" within the meaning of Section 414(b),
(c), (m) or (o) of the Code.
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"Eurodollar Loan" shall mean each Loan designated as such by the
Borrower at the time of the incurrence thereof or conversion thereto.
"Eurodollar Rate" shall mean the offered quotation which appears on
Telerate Page 4738 for Dollar deposits of amounts in immediately available funds
comparable to the outstanding principal amount of the Eurodollar Loan of BTCo
with maturities comparable to the Interest Period applicable to such Eurodollar
Loan commencing two Business Days thereafter as of 10:00 A.M. (New York time) on
the date which is two Business Days prior to the commencement of such Interest
Period, divided (and rounded off to the nearest 1/16 of 1%) by a percentage
equal to 100% minus the then stated maximum rate of all reserve requirements
(including, without limitation, any marginal, emergency, supplemental, special
or other reserves required by applicable law) applicable to any member bank of
the Federal Reserve System in respect of Eurocurrency funding or liabilities as
defined in Regulation D (or any successor category of liabilities under
Regulation D).
"Event of Default" shall have the meaning provided in Section 10.
"Excess Cash Flow" shall mean, for any period, the remainder of (a)
the sum of (i) Adjusted Consolidated Net Income for such period and (ii) the
decrease, if any, in Adjusted Consolidated Working Capital from the first day to
the last day of such period, minus (b) the sum of (i) the amount of Capital
Expenditures made by the Borrower and its Subsidiaries on a consolidated basis
during such period pursuant to and in accordance with Section 9.07(a) and (b),
except to the extent financed with the proceeds of Indebtedness or pursuant to
Capitalized Lease Obligations, (ii) the aggregate amount of permanent principal
payments of Indebtedness for borrowed money of the Borrower and the repayment of
the principal component of Capitalized Lease Obligations of the Borrower and its
Subsidiaries (excluding (1) payments with proceeds of issuances of Indebtedness
or equity or with proceeds of asset sales and (2) payments of Loans or other
Obligations pursuant to Sections 4.02 (e), (f), (g) and (i)), (iii) cash
Dividends paid during such period, (iv) the increase, if any, in Adjusted
Consolidated Working Capital from the first day to the last day of such period,
(v) the amount of all expenses (including expenses incurred in connection with
acquisitions) that have been paid during such period to the extent that such
expenses have been capitalized in accordance with GAAP but only to the extent
that the payment thereof does not otherwise reduce Adjusted Consolidated Net
Income and (vi) the principal amount of Senior Subordinated Notes paid with
additional notes; and PROVIDED that in the event Holdings, the Borrower or any
Subsidiary of Holdings acquired any Person during such period, Adjusted
Consolidated Net Income for such period shall be calculated on a pro forma
basis, based on the actual historical results of such acquired Person as if such
Person had been acquired on the first day of such period.
"Excess Cash Payment Date" shall mean the date occurring 110 days
after the last day of each fiscal year of the Borrower (beginning with its
fiscal year ending December 31, 1998).
"Excess Cash Payment Period" shall mean with respect to the repayment
required on each Excess Cash Payment Date, the immediately preceding fiscal year
of the Borrower.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
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"Facing Fee" shall have the meaning provided in Section 3.01(c).
"Federal Funds Rate" shall mean for any period, a fluctuating interest
rate equal for each day during such period to the weighted average of the rates
on overnight Federal Funds transactions with members of the Federal Reserve
System arranged by Federal Funds brokers, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day which
is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal Funds
brokers of recognized standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or referred to in
Section 3.01.
"Foreign Joint Ventures" means joint ventures entered into by the
Borrower or any of its Subsidiaries for the primary purpose of operating a
business outside of the United States of the type in which the Borrower and its
Subsidiaries are engaged on the Initial Borrowing Date and reasonable extensions
thereof.
"Foreign Subsidiary" shall mean each Subsidiary of the Borrower
incorporated or organized in a jurisdiction other than the United States or any
State thereof.
"Foreign Subsidiary Indebtedness" shall mean, at any time, the sum of
the aggregate outstanding amount of all Indebtedness incurred by all of the
Foreign Subsidiaries.
"GAAP" shall have the meaning provided in Section 13.07(a).
"Guaranteed Obligations" shall mean the irrevocable and unconditional
guaranty made by Holdings (i) to each Bank for the full and prompt payment when
due (whether at the stated maturity, by acceleration or otherwise) of the
principal and interest on each Note issued by the Borrower to such Bank, and
Loans made, under the Credit Agreement and all reimbursement obligations and
Unpaid Drawings with respect to Letters of Credit, together with all the other
obligations and liabilities (including, without limitation, indemnities, fees
and interest thereon) of the Borrower to such Bank now existing or hereafter
incurred under, arising out of or in connection with the Credit Agreement or any
other Credit Document and the due performance and compliance with all the terms,
conditions and agreements contained in the Credit Documents by the Borrower and
(ii) to each Bank and each Affiliate of a Bank which enters into an Interest
Rate Protection Agreement with the Borrower, which by its express terms are
entitled to the benefit of the Guaranty pursuant to Section 14 with the written
consent of the Borrower and the Administrative Agent, the full and prompt
payment when due (whether by acceleration or otherwise) of all obligations of
the Borrower owing under any such Interest Rate Protection Agreement, whether
now in existence or hereafter arising, and the due performance and compliance
with all terms, conditions and agreements contained therein.
"Guarantor" shall mean Holdings and each Subsidiary Guarantor, if any.
"Guaranty" shall mean the guaranty made by Holdings pursuant to
Section 14, and any Subsidiary Guaranty executed pursuant to Section 8.11(e).
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"Holdings" shall have the meaning provided in the first paragraph of
this Agreement.
"Holdings Common Stock" shall have the meaning provided in Section
5.06(a)(i).
"Holdings Debentures" shall have the meaning provided in Section
5.06(a)(i).
"Holdings Debenture Documents" shall mean the Holdings Debentures, the
Holdings Debenture Indenture and all other documents or instruments executed in
connection with the Holdings Debentures.
"Holdings Debenture Indenture" shall mean that certain indenture dated
as of May 22, 1998 by and between Holdings, as issuer and State Street Bank and
Trust Company of California, N.A. as trustee, which Holdings Debenture Indenture
shall contain terms and conditions reasonably satisfactory to the Administrative
Agent.
"Holdings Financing" shall have the meaning provided in Section
5.06(a)(i).
"Holdings Financing Documents" shall mean the Holdings Debenture
Documents, the Holdings Common Stock and all other documents or agreements
relating to the issuance or incurrence of the foregoing.
"Indebtedness" shall mean, as to any Person, without duplication, (i)
all indebtedness (including principal, interest, fees and charges) of such
Person for borrowed money or for the deferred purchase price of property or
services due more than 90 days after acquisition of the property or receipt of
services or which is otherwise represented by a note, (ii) the maximum amount
available to be drawn under all letters of credit issued for the account of such
Person and all unpaid drawings in respect of such letters of credit, (iii) all
Indebtedness of the types described in clause (i), (ii), (iv), (v) or (vi) of
this definition secured by any Lien on any property owned by such Person,
whether or not such Indebtedness has been assumed by such Person (to the extent
of the lesser of the amount of such Indebtedness and the value of the respective
property), (iv) Capitalized Lease Obligations, (v) all Contingent Obligations of
such Person and (vi) all obligations under any Interest Rate Protection
Agreement or under any similar type of agreement.
"Initial Borrowing Date" shall mean the date occurring on or after the
Effective Date on which the initial Borrowing of Term Loans hereunder occurs.
"Interest Coverage Ratio" shall mean on the date of determination
thereof the ratio of (i) Consolidated EBITDA to (ii) Consolidated Net Cash
Interest Expense for the Test Period ended on the last day of the fiscal quarter
last ended prior to the date such determination is made, PROVIDED that for any
period ending prior to June 30, 1999, (x) Consolidated EBITDA shall be
calculated by using Consolidated EBITDA of the Borrower, including fiscal
quarters ending prior to the Initial Borrowing Date, and (y) Consolidated Net
Cash Interest Expense shall be calculated, (I) for the Test Period ended
September 30, 1998, by multiplying Consolidated Net Cash Interest Expense for
the fiscal quarter ended on the same date by 4; (II) for the Test Period Ended
December 31, 1998, by multiplying Consolidated Net Cash Interest Expense for the
fiscal quarter
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ended on the same date by 2; and (III) for the Test Period ended March 31, 1999,
by multiplying Consolidated Net Cash Interest Expense for the fiscal quarter
ended on the same date by 4/3.
"Interest Determination Date" shall mean, with respect to any
Eurodollar Loan, the second Business Day prior to the commencement of any
Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in Section 1.09.
"Interest Rate Protection Agreement" shall mean any interest rate swap
agreement, interest rate cap agreement, interest collar agreement, interest rate
hedging agreement or other similar agreement or arrangement.
"Interest Reduction Discount" shall mean (i) initially 0% and (ii)
from and after each day of delivery of any certificate delivered in accordance
with the following sentence indicating an entitlement to an Interest Reduction
Discount other than zero (each, a "Start Date") to and including the applicable
End Date described below, the percentage set forth below opposite the Leverage
Ratio indicated to have been achieved in any certificate delivered in accordance
with the following sentence:
Base Rate Eurodollar
Leverage Ratio Loans Loans
-------------- ----------- ----------
Equal to or greater than 5:1 0% 0%
Equal to or greater than 4.5:1
but less than 5.0:1 0.25 % 0.25 %
Equal to or greater than 4.0:1
but less than 4.5:1 0.50 % 0.50 %
Less than 4.0:1 0.75 % 0.75 %
The Leverage Ratio shall be determined based on the delivery of a certificate of
the Borrower to the Administrative Agent (with a copy to be sent by the
Administrative Agent to each Bank), certified by an Authorized Officer of the
Borrower within 30 days after the last day of any fiscal quarter of the
Borrower, (commencing with its fiscal quarter ending December 31, 1998, which
certificate shall set forth the calculation of the Leverage Ratio for the Test
Period ended immediately prior to the relevant Start Date and the Interest
Reduction Discount which shall be thereafter applicable (until same is changed
or ceases to apply in accordance with the following sentences). The Interest
Reduction Discount so determined shall apply, except as set forth in the
succeeding sentence, from the Start Date to the earlier of (x) the date on which
the next certificate is delivered to the Administrative Agent and (y) the date
which is 30 days following the last day of the fiscal quarter in which the
previous Start Date occurred (the "End Date"), at which time, if no certificate
has been delivered to the Administrative Agent indicating an entitlement to an
Interest Reduction Discount other than zero (and thus commencing a new Start
Date), the Interest Reduction Discount shall be reduced to zero.
Notwithstanding anything to the contrary contained
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above in this definition, the Interest Reduction Discount shall be reduced to
zero at all times during which there shall exist an Event of Default.
"Issuing Bank" shall mean, BTCo and any Bank which at the request of
the Borrower and with the consent of the Administrative Agent agrees, in such
Bank's sole discretion, to become an Issuing Bank for the purpose of issuing
Letters of Credit pursuant to Section 2. The sole Issuing Bank on the Initial
Borrowing Date is BTCo.
"L/C Supportable Obligations" shall mean obligations of the Borrower
or its Subsidiaries incurred in the ordinary course of business.
"Leaseholds" of any Person means all the right, title and interest of
such Person as lessee or licensee in, to and under leases or licenses of land,
improvements and/or fixtures.
"Letter of Credit" shall have the meaning provided in Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in Section
3.01(b).
"Letter of Credit Outstandings" shall mean, at any time, the sum of
(i) the aggregate Stated Amount of all outstanding Letters of Credit and (ii)
the amount of all Unpaid Drawings relating to Letters of Credit.
"Letter of Credit Request" shall have the meaning provided in Section
2.02(a).
"Leverage Ratio" shall mean on the date of determination thereof the
ratio of (i) Consolidated Indebtedness on such date to (ii) Consolidated EBITDA
(which shall be calculated for any period ending prior to June 30, 1999, by
using the following amounts for such following periods: fiscal quarter ended
June 30, 1997, $13,807,000; fiscal quarter ended September 30, 1997,
$15,160,000; fiscal quarter ended December 31, 1997, $17,001,000; and fiscal
quarter ended March 31, 1998, $16,528,000 for the Test Period ended on the last
day of any fiscal quarter last ended prior to the date such determination is
made.
"Lien" shall mean any mortgage, pledge, hypothecation, assignment,
deposit arrangement, encumbrance, lien (statutory or other), preference,
priority or other security agreement of any kind or nature whatsoever
(including, without limitation, any conditional sale or other title retention
agreement, any financing or similar statement or notice filed under the UCC or
any other similar recording or notice statute, and any lease having
substantially the same effect as any of the foregoing).
"Loan" shall mean each Term Loan, each Revolving Loan and each
Swingline Loan.
"Majority Banks" shall mean collectively (and not individually) with
respect to any Tranche, Non-Defaulting Banks whose outstanding Term Loans of
such Tranche (or, if prior to the Initial Borrowing Date, Term Loan Commitments
of such Tranche) constitute at least a majority of the total outstanding Term
Loans of such Tranche (or, if prior to the Initial Borrowing Date, Term Loan
Commitments of such Tranche) of all Non-Defaulting Banks.
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"Management Agreements" shall have the meaning provided in Section
5.05.
"Mandatory Borrowing" shall have the meaning provided in Section
1.01(f).
"Margin Stock" shall have the meaning provided in Regulation U.
"Maximum Swingline Amount" shall mean $5,000,000.
"Material Adverse Effect" shall mean a material adverse effect on the
business, operations, properties, assets, liabilities, condition (financial or
otherwise) or prospects of the Borrower or Holdings and its subsidiaries taken
as a whole.
"Merger" shall mean the merger between Great Lakes Acquisition Sub.
Corp. and Great Lakes Carbon Corporation, pursuant to the Merger Agreement.
"Merger Agreement" shall mean the Agreement and Plan of Merger dated
as of April 22, 1998, by and between Great Lakes Carbon Corporation and
Holdings.
"Merger Documents" shall mean the Merger Agreement and all other
documents executed in connection with the Merger.
"Mortgage" shall have the meaning provided in Section 5.09(a), and,
after the execution and delivery thereof, shall include each Additional Mortgage
delivered pursuant to Section 8.11.
"Mortgage Policies" shall have the meaning provided in Section
5.09(c).
"Mortgaged Property" shall have the meaning provided in Section
5.09(a) and, after the execution or delivery thereof, shall include each
property covered by an Additional Mortgage.
"Net Interest Expense" shall mean, for any period, the total interest
expense of any Person for such period (calculated without regard to any
limitations on the payment thereof) plus, without duplication, that portion of
Capitalized Lease Obligations of such Person representing the interest factor
for such period in each case net of the total consolidated cash interest income
of such Person for such period, but excluding the amortization of any deferred
financing costs incurred in connection with this Agreement.
"Net Sale Proceeds" shall mean for any sale, lease, transfer or other
disposition of assets, the gross cash proceeds (including any cash received by
way of deferred payment pursuant to a promissory note, receivable or otherwise,
but only as and when received) received by Holdings and/or any of its
Subsidiaries from such sale, lease, transfer or other disposition, net of
reasonable transaction costs (including, without limitation, any underwriting,
brokerage or other customary selling commissions and reasonable legal, advisory
and other fees and expenses, including title and recording expenses and
reasonable expenses incurred for preparing such assets for sale, associated
therewith) and payments of unassumed liabilities relating to the assets sold at
the time of, or within 30 days after, the date of such sale, the amount of such
gross cash proceeds
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required to be used to repay any Indebtedness (other than Indebtedness of the
Banks pursuant to this Agreement) which is secured by the respective assets
which were sold, all distributions and other payments made to minority interest
holders in Subsidiaries of the Borrower in connection with such disposition, and
the estimated marginal increase in income taxes which will be payable by
Holdings' consolidated group with respect to the fiscal year in which the sale
occurs as a result of such sale; but excluding any portion of any such gross
cash proceeds which Holdings determines in good faith should be reserved for
post-closing adjustments (to the extent Holdings' delivers to the Banks a
certificate signed by an Authorized Officer as to such determination), it being
understood and agreed that on the day that all such post-closing adjustments
have been determined (which shall not be later than one year following the date
of the respective asset sale), the amount (if any) by which the reserved amount
in respect of such sale or disposition exceeds the actual post-closing
adjustments payable by Holdings or any of its Subsidiaries shall constitute Net
Sale Proceeds on such date).
"Non-Defaulting Bank" shall mean and include each Bank which is not a
Defaulting Bank.
"Note" shall mean each Term Note, each Revolving Note and the
Swingline Note.
"Notice of Borrowing" shall have the meaning provided in Section 1.03.
"Notice of Conversion" shall have the meaning provided in Section
1.06.
"Notice Office" shall mean the office of the Administrative Agent
located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx
Xxxxx, or such other office as the Administrative Agent may hereafter designate
in writing as such to the other parties hereto.
"Obligations" shall mean all amounts owing to the Administrative
Agent, the Collateral Agent or any Bank pursuant to the terms of this Agreement
or any other Credit Document.
"Participant" shall have the meaning provided in Section 2.03(a).
"Payment Office" shall mean the office of the Administrative Agent
located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx
Xxxxx, or such other office as the Administrative Agent may hereafter designate
in writing as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation established
pursuant to Section 4002 of ERISA, or any successor thereto.
"Percentage" shall mean, at any time, for each Bank with a Revolving
Loan Commitment, the percentage obtained by dividing such Bank's Revolving Loan
Commitment by the Total Revolving Loan Commitment; PROVIDED, that if the Total
Revolving Loan Commitment has been terminated, the Percentage of each such Bank
shall be determined by dividing such Bank's Revolving Loan Commitment
immediately prior to such termination by the Total Revolving Loan Commitment
immediately prior to such termination.
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"Permitted Encumbrance" shall mean, with respect to any Mortgaged
Property, such exceptions to title as are set forth in the title insurance
policy or title commitment delivered with respect thereto, all of which
exceptions must be acceptable to the Administrative Agent in its reasonable
discretion.
"Permitted Liens" shall have the meaning provided in Section 9.01.
"Person" shall mean any individual, partnership, joint venture, firm,
corporation, association, trust or other enterprise or any government or
political subdivision or any agency, department or instrumentality thereof.
"Plan" shall mean any multiemployer or single-employer plan, as
defined in Section 4001 of ERISA, which is maintained or contributed to by (or
to which there is an obligation to contribute of), the Borrower or a Subsidiary
of the Borrower or an ERISA Affiliate, and each such plan for the five year
period immediately following the latest date on which the Borrower, a Subsidiary
of the Borrower or an ERISA Affiliate maintained, contributed or had an
obligation to contribute to such plan.
"Pledge Agreement" shall have the meaning provided in Section 5.07.
"Pledge Agreement Collateral" shall mean all "Collateral" as defined
in the Pledge Agreement.
"Pledged Securities" shall mean "Pledged Securities" as defined in the
Pledge Agreement.
"Prime Lending Rate" shall mean the rate which Bankers Trust Company
announces from time to time as its prime lending rate, the Prime Lending Rate to
change when and as such prime lending rate changes. The Prime Lending Rate is a
reference rate and does not necessarily represent the lowest or best rate
actually charged to any customer. Bankers Trust Company may make commercial
loans or other loans at rates of interest at, above or below the Prime Lending
Rate.
"Projections" shall have the meaning provided in Section 7.05(d).
"Quarterly Payment Date" shall mean the last Business Day of each
August, November, February and May commencing with August 1998.
"Real Property" of any Person shall mean all the right, title and
interest of such Person in and to land, improvements and fixtures, including
Leaseholds.
"Recovery Event" shall mean the receipt by Holdings or any of its
Subsidiaries of any (i) cash insurance proceeds payable (x) by reason of theft,
loss, physical destruction or damage or any other similar event with respect to
any property or assets of Holdings or any of its Subsidiaries and (y) under any
policy of insurance required to be maintained under Section 8.03 or (ii)
condemnation award payable by reason of eminent domain or deed in lieu thereof.
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"Refinancing" shall have the meaning provided in Section 5.06(a)(iii).
"Register" shall have the meaning set forth in Section 13.17.
"Regulation D" shall mean Regulation D of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof establishing reserve requirements.
"Regulation T" shall mean Regulation T of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of Governors of
the Federal Reserve System as from time to time in effect and any successor to
all or a portion thereof.
"Reinvestment Assets" shall mean any assets to be employed in the
business of the Borrower and its Subsidiaries as described in Sections
4.02(A)(g) and 9.02(ii).
"Reinvestment Election" shall have the meaning provided in Section
4.02(A)(g).
"Reinvestment Notice" shall mean a written notice signed by the
Authorized Officer of the Borrower stating that the Borrower, in good faith,
intends and expects to use all or a specified portion of the Net Sale Proceeds
of an Asset Sale to purchase, construct or otherwise acquire Reinvestment
Assets.
"Replaced Bank" shall have the meaning provided in Section 1.13.
"Replacement Bank" shall have the meaning provided in Section 1.13.
"Reportable Event" shall mean an event described in Section 4043(b) of
ERISA with respect to a Plan as to which the 30-day notice requirement has not
been waived by the PBGC.
"Required Banks" shall mean Non-Defaulting Banks, the sum of whose
outstanding Term Loans (or, if prior to the Initial Borrowing Date, Term Loan
Commitments) and Revolving Loan Commitments (or after the termination thereof,
outstanding Revolving Loans and Adjusted Percentage of outstanding Swingline
Loans and Letter of Credit Outstandings) represent an amount greater than 50% of
the sum of (x) all outstanding Term Loans (or, if prior to the Initial Borrowing
Date, Term Loan Commitments) of Non-Defaulting Banks and (y) the Total Revolving
Loan Commitment (or after the termination thereof, the sum of the then total
outstanding Revolving Loans and Adjusted Percentage of the then outstanding
Swingline Loans and Letter of Credit Outstandings at such time) of
Non-Defaulting Banks.
"Returns" shall have the meaning provided in Section 7.09.
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"Revolving Loan" shall have the meaning provided in Section 1.01(d).
"Revolving Loan Commitment" shall mean, for each Bank, the amount set
forth opposite such Bank's name in Schedule I hereto directly below the column
entitled "Revolving Loan Commitment," as same may be (x) reduced from time to
time pursuant to Sections 3.02, 3.03, 4.02(A) and/or 10 or (y) adjusted from
time to time as a result of assignments to or from such Bank pursuant to Section
1.13 or 13.04(b).
"Revolving Loan Maturity Date" shall mean May 31, 2003.
"Revolving Note" shall have the meaning provided in Section 1.05(a).
"Scheduled Repayments" shall have the meaning provided in Section
4.02(A)(d).
"SEC" shall have the meaning provided in Section 8.01(h).
"Section 4.04(b)(ii) Certificate" shall have the meaning provided in
Section 4.04(b).
"Secured Creditors" shall have the meaning assigned that term in the
Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Security Agreement" shall have the meaning provided in Section 5.08
and include any Additional Security Document delivered pursuant to Section 8.11.
"Security Agreement Collateral" shall mean all "Collateral" as defined
in the Security Agreement.
"Security Document" shall mean and include the Pledge Agreement, the
Security Agreement, each Mortgage and, after the execution and delivery thereof,
each Additional Mortgage and each Additional Security Document required to be
delivered pursuant to Section 8.11.
"Senior Secured Notes" shall mean the 10% Senior Secured Notes due
2006 issued by the Borrower under the Senior Secured Notes Indenture.
"Senior Secured Notes Collateral Documents" shall mean the Senior
Secured Notes Security Agreement, the Senior Secured Notes Mortgage, Assignment
of Rents, Leases and Leasehold Interests and Fixture Filing Statement, the
Senior Secured Notes Patent Security Agreement and the Senior Secured Notes
Trademark Security Agreement.
"Senior Secured Notes Collateral Documents Amendment" shall mean the
amendments to the Senior Secured Notes Collateral Documents in form and
substance satisfactory to the Administrative Agent and entered into by the
parties to the respective Senior
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Secured Notes Collateral Documents in connection with the Senior Secured Notes
Tender Offer/Consent Solicitation.
"Senior Secured Notes Indenture" shall mean that certain indenture
dated as of December 20, 1995, among the Borrower and The Bank of New York as
trustee.
"Senior Secured Notes Indenture Supplement" shall mean the
Supplemental Indenture to the Senior Secured Notes Indenture in form and
substance satisfactory to the Administrative Agent and entered into by the
Borrower and The Bank of New York in connection with the Senior Secured Notes
Tender Offer/Consent Solicitation.
"Senior Secured Notes Mortgage, Assignment of Rents, Leases and
Leasehold Interests and Fixture Filing Statement" shall mean the Mortgage,
Assignment of Rents, Leases and Leasehold Interests and Fixture Filing Statement
dated as of December 20, 1995 among the Borrower and The Bank of New York as
trustee.
"Senior Secured Notes Patent Security Agreement" shall mean the Patent
Security Agreement dated as of December 20, 1995 among the Borrower and The
Bank of New York as trustee.
"Senior Secured Notes Security Agreement" shall mean the Security
Agreement dated as of December 20, 1995 among the Borrower and The Bank of New
York as trustee.
"Senior Secured Notes Tender Offer/Consent Solicitation" shall have
the meaning set forth in Section 5.06(a)(iii).
"Senior Secured Notes Tender Offer Documents" shall mean the Senior
Secured Notes Indenture Supplement, the Senior Secured Notes Collateral
Documents Amendment and the Senior Secured Notes Tender Offer/Consent
Solicitation, as in effect on the Initial Borrowing Date and as same may be
amended, modified or supplemented from time to time pursuant to the terms
thereof and hereof.
"Senior Secured Notes Tender Offer Repurchases" shall have the meaning
provided in Section 5.06(a)(iii).
"Senior Secured Notes Trademark Security Agreement" shall mean the
Trademark Security Agreement dated as of December 20, 1995 among the Borrower
and The Bank of New York as trustee.
"Senior Subordinated Note Documents" shall mean the Senior
Subordinated Notes, the Senior Subordinated Note Indenture and all other
documents executed in connection with the Senior Subordinated Notes.
"Senior Subordinated Note Indenture" shall mean that certain indenture
dated as of May 22, 1998 by and between the Borrower and State Street Bank and
Trust Company of California, N.A., as trustee.
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"Senior Subordinated Note Issuance" shall have the meaning provided in
Section 5.06(a)(ii).
"Senior Subordinated Notes" shall mean the 10 1/4% Senior Subordinated
Notes due 2008 issued by the Borrower under the Senior Subordinated Note
Indenture.
"Shareholders' Agreements" shall have the meaning provided in Section
5.05.
"Significant Subsidiary" of Holdings shall mean (i) the Borrower, (ii)
any Subsidiary Guarantor and (iii) any other Subsidiary of Holdings that would
be a "significant subsidiary" of Holdings as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Exchange Act, as such Regulation is
in effect on the date hereof.
"Start Date" shall have the meaning provided in the definition of
Interest Reduction Discount.
"Stated Amount" of each Letter of Credit shall, at any time, mean the
maximum amount available to be drawn thereunder (in each case determined without
regard to whether any conditions to drawing could then be met).
"Subsidiary" shall mean, as to any Person, (i) any corporation more
than 50% of whose stock of any class or classes having by the terms thereof
ordinary voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such Person and/or one or
more Subsidiaries of such Person and (ii) any partnership, association, joint
venture or other entity in which such Person and/or one or more Subsidiaries of
such Person has more than a 50% equity interest at the time.
"Subsidiary Guarantor" shall mean each Domestic Subsidiary of the
Borrower .
"Subsidiary Guaranty" shall have the meaning provided in Section
8.11(e).
"Swingline Bank" shall mean Bankers Trust Company, in its capacity as
the lender of Swingline Loans.
"Swingline Expiry Date" shall mean the date which is five Business
Days prior to the Revolving Loan Maturity Date.
"Swingline Loans" shall have the meaning provided in Section 1.01(e).
"Swingline Note" shall have the meaning provided in Section 1.05(a).
"Tax Sharing Agreement" shall have the meaning provided in Section
5.05.
"Taxes" shall have the meaning provided in Section 4.04(a).
"Term Loan" shall have the meaning provided in Section 1.01(c).
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"Term Loan Commitment" shall mean for each Bank, the A Term Loan
Commitment, B Term Loan Commitment or C Term Loan Commitment, if any, of such
Bank.
"Term Notes" shall have the meaning provided in Section 1.05(a).
"Test Period" shall mean for any determination the four consecutive
fiscal quarters then last ended (taken as one accounting period).
"Total A Term Loan Commitment" shall mean, at any time, the sum of the
A Term Loan Commitments of each Bank.
"Total B Term Loan Commitment" shall mean, at any time, the sum of the
B Term Loan Commitments of each Bank.
"Total C Term Loan Commitment" shall mean, at any time, the sum of the
C Term Loan Commitments of each Bank.
"Total Commitment" shall mean the sum of the Total Term Loan
Commitment and the Total Revolving Loan Commitment.
"Total Revolving Loan Commitment" shall mean, at any time, the sum of
the Revolving Loan Commitments of each of the Banks.
"Total Term Loan Commitment" shall mean, at any time, the sum of the A
Term Loan Commitments, the B Term Loan Commitments and the C Term Loan
Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at any time,
the sum of the Unutilized Revolving Loan Commitments of each of the Banks.
"Tranche" shall mean the respective facility and commitments utilized
in making Loans hereunder, with there being five separate Tranches, I.E., A Term
Loans, B Term Loans, C Term Loans, Revolving Loans and Swingline Loans.
"Transaction" shall mean the Merger, the Senior Subordinated Note
Issuance, the Holdings Financing, the Refinancing and the incurrence of Loans on
the Initial Borrowing Date.
"Transaction Documents" shall mean the Merger Documents, the Senior
Subordinated Note Documents, the documents effecting the Refinancing, the
Holdings Financing Documents and all other documents effectuating the
Transaction or executed in connection therewith.
"Type" shall mean the type of Loan determined with regard to the
interest option applicable thereto, I.E., whether a Base Rate Loan or a
Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time to time in
effect in the relevant jurisdiction.
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"Unfunded Current Liability" of any Plan means the amount, if any, by
which the actuarial present value of the accumulated benefits under the Plan as
of the close of its most recent plan year, determined in accordance with
Statement of Financial Accounting Standards No. 35, based upon the actuarial
assumptions used by the Plan's actuary in the most recent annual valuation of
the Plan, exceeds the fair market value of the assets allocable thereto,
determined in accordance with Section 412 of the Code.
"United States" and "U.S." shall each mean the United States of
America.
"Unpaid Drawing" shall have the meaning provided in Section 2.04(a).
"Unutilized Revolving Loan Commitment" with respect to any Bank, at
any time, shall mean such Bank's Revolving Loan Commitment at such time less (i)
the aggregate outstanding principal amount of Revolving Loans made by such Bank
plus (ii) such Bank's Adjusted Percentage of all Letter of Credit Outstandings.
"Voting Stock" shall mean, as to any Person, any class or classes of
capital stock of such Person pursuant to which the holders thereof have the
general voting power under ordinary circumstances to elect at least a majority
of the Board of Directors of such Person, or any class or classes of capital
stock convertible into such stock at the option of the holders thereof.
"Waivable Mandatory Repayment" shall have the meaning provided in
Section 4.02(B).
"Wholly-Owned Domestic Subsidiary" shall mean each Wholly-Owned
Subsidiary of the Borrower incorporated or organized under the laws of the
United States or any State thereof.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i) any
corporation 100% of whose capital stock (other than director's qualifying
shares) is at the time owned by such Person and/or one or more Wholly-Owned
Subsidiaries of such Person and (ii) any partnership, association, joint venture
or other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time. Any
reference to a Wholly-Owned Subsidiary, unless expressly to a Wholly-Owned
Subsidiary of another Person, shall mean a Wholly-Owned Subsidiary of the
Borrower.
SECTION 12. The Administrative Agent.
12.01 APPOINTMENT. The Banks hereby designate Bankers Trust Company
as Administrative Agent (for purposes of this Section 12, the term
"Administrative Agent" shall include Bankers Trust Company in its capacity as
Collateral Agent pursuant to the Security Documents) to act as specified herein
and in the other Credit Documents. Each Bank hereby irrevocably authorizes, and
each holder of any Note by the acceptance of such Note shall be deemed
irrevocably to authorize, the Administrative Agent to take such action on its
behalf under the provisions of this Agreement, the other Credit Documents and
any other instruments and agreements referred to herein or therein and to
exercise such powers and to perform such duties
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hereunder and thereunder as are specifically delegated to or required of the
Administrative Agent by the terms hereof and thereof and such other powers as
are reasonably incidental thereto. The Administrative Agent may perform any of
its duties hereunder by or through its respective officers, directors, agents,
employees or affiliates.
12.02 NATURE OF DUTIES. The Administrative Agent shall not have any
duties or responsibilities except those expressly set forth in this Agreement
and the Security Documents. Neither the Administrative Agent nor any of its
respective officers, directors, agents, employees or affiliates shall be liable
for any action taken or omitted by it or them hereunder or under any other
Credit Document or in connection herewith or therewith, unless caused by its or
their gross negligence or willful misconduct. The duties of the Administrative
Agent shall be mechanical and administrative in nature; the Administrative Agent
shall not have by reason of this Agreement or any other Credit Document a
fiduciary relationship in respect of any Bank or the holder of any Note; and
nothing in this Agreement or any other Credit Document, expressed or implied, is
intended to or shall be so construed as to impose upon the Administrative Agent
any obligations in respect of this Agreement or any other Credit Document except
as expressly set forth herein or therein.
12.03 LACK OF RELIANCE ON THE ADMINISTRATIVE AGENT. Independently
and without reliance upon the Administrative Agent, each Bank and the holder of
each Note, to the extent it deems appropriate, has made and shall continue to
make (i) its own independent investigation of the financial condition and
affairs of Holdings and its Subsidiaries in connection with the making and the
continuance of the Loans and the taking or not taking of any action in
connection herewith and (ii) its own appraisal of the creditworthiness of
Holdings and its Subsidiaries and, except as expressly provided in this
Agreement, the Administrative Agent shall not have any duty or responsibility,
either initially or on a continuing basis, to provide any Bank or the holder of
any Note with any credit or other information with respect thereto, whether
coming into its possession before the making of the Loans or at any time or
times thereafter. The Administrative Agent shall not be responsible to any Bank
or the holder of any Note for any recitals, statements, information,
representations or warranties herein or in any document, certificate or other
writing delivered in connection herewith or for the execution, effectiveness,
genuineness, validity, enforceability, perfection, collectibility, priority or
sufficiency of this Agreement or any other Credit Document or the financial
condition of Holdings and its Subsidiaries or be required to make any inquiry
concerning either the performance or observance of any of the terms, provisions
or conditions of this Agreement or any other Credit Document, or the financial
condition of Holdings and its Subsidiaries or the existence or possible
existence of any Default or Event of Default.
12.04 CERTAIN RIGHTS OF THE ADMINISTRATIVE AGENT. If the
Administrative Agent shall request instructions from the Required Banks with
respect to any act or action (including failure to act) in connection with this
Agreement or any other Credit Document, the Administrative Agent shall be
entitled to refrain from such act or taking such action unless and until the
Administrative Agent shall have received instructions from the Required Banks;
and the Administrative Agent shall not incur liability to any Person by reason
of so refraining. Without limiting the foregoing, neither any Bank nor the
holder of any Note shall have any right of action whatsoever against the
Administrative Agent as a result of the Administrative Agent acting or
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refraining from acting hereunder or under any other Credit Document in
accordance with the instructions of the Required Banks.
12.05 RELIANCE. The Administrative Agent shall be entitled to rely,
and shall be fully protected in relying, upon any note, writing, resolution,
notice, statement, certificate, telex, teletype or telecopier message,
cablegram, radiogram, order or other document or telephone message signed, sent
or made by any Person that the Administrative Agent believed to be the proper
Person, and, with respect to all legal matters pertaining to this Agreement and
any other Credit Document and its duties hereunder and thereunder, upon advice
of counsel selected by the Administrative Agent.
12.06 INDEMNIFICATION. To the extent the Administrative Agent is not
reimbursed and indemnified by the Borrower the Banks will reimburse and
indemnify the Administrative Agent, in proportion to their respective
"percentages" as used in determining the Required Banks, for and against any and
all liabilities, obligations, losses, damages, penalties, claims, actions,
judgments, costs, expenses or disbursements of whatsoever kind or nature which
may be imposed on, asserted against or incurred by the Administrative Agent in
performing its respective duties hereunder or under any other Credit Document,
in any way relating to or arising out of this Agreement or any other Credit
Document; PROVIDED that no Bank shall be liable for any portion of such
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or disbursements resulting from the Administrative Agent's gross
negligence or willful misconduct.
12.07 THE ADMINISTRATIVE AGENT IN ITS INDIVIDUAL CAPACITY. With
respect to its obligation to make Loans under this Agreement, the Administrative
Agent shall have the rights and powers specified herein for a "Bank" and may
exercise the same rights and powers as though it were not performing the duties
specified herein; and the term "Banks," "Required Banks," "holders of Notes" or
any similar terms shall, unless the context clearly otherwise indicates, include
the Administrative Agent in its individual capacity. The Administrative Agent
may accept deposits from, lend money to, and generally engage in any kind of
banking, trust or other business with any Credit Party or any Affiliate of any
Credit Party as if it were not performing the duties specified herein, and may
accept fees and other consideration from the Borrower or any other Credit Party
for services in connection with this Agreement and otherwise without having to
account for the same to the Banks.
12.08 HOLDERS. The Administrative Agent may deem and treat the payee
of any Note as the owner thereof for all purposes hereof unless and until a
written notice of the assignment, transfer or endorsement thereof, as the case
may be, shall have been filed with the Administrative Agent. Any request,
authority or consent of any Person who, at the time of making such request or
giving such authority or consent, is the holder of any Note shall be conclusive
and binding on any subsequent holder, transferee, assignee or indorsee, as the
case may be, of such Note or of any Note or Notes issued in exchange therefor.
12.09 RESIGNATION BY THE ADMINISTRATIVE AGENT. (a) The
Administrative Agent may resign from the performance of all its functions and
duties hereunder and/or under the other Credit Documents at any time by giving
15 Business Days' prior written notice to the Borrower
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and the Banks. Such resignation shall take effect upon the appointment of a
successor Administrative Agent pursuant to clauses (b) and (c) below or as
otherwise provided below.
(b) Upon any such notice of resignation, the Banks shall appoint a
successor Administrative Agent hereunder or thereunder who shall be a commercial
bank or trust company reasonably acceptable to the Borrower.
(c) If a successor Administrative Agent shall not have been so
appointed within such 15 Business Day period, the Administrative Agent, with the
consent of the Borrower, shall then appoint a successor Administrative Agent who
shall serve as Administrative Agent hereunder or thereunder until such time, if
any, as the Banks appoint a successor Administrative Agent as provided above.
(d) If no successor Administrative Agent has been appointed pursuant
to clause (b) or (c) above by the 20th Business Day after the date such notice
of resignation was given by the Administrative Agent, the Administrative Agent's
resignation shall become effective and the Required Banks shall thereafter
perform all the duties of the Administrative Agent hereunder and/or under any
other Credit Document until such time, if any, as the Banks appoint a successor
Administrative Agent as provided above.
SECTION 13. Miscellaneous.
13.01 PAYMENT OF EXPENSES, ETC. The Borrower shall: (i) whether or
not the transactions herein contemplated are consummated, pay all reasonable
out-of-pocket costs and expenses of the Administrative Agent (including, without
limitation, the reasonable fees and disbursements of White & Case LLP and local
counsel) in connection with the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and instruments
referred to herein and therein and any amendment, waiver or consent relating
hereto or thereto, of the Administrative Agent in connection with its
syndication efforts with respect to this Agreement and, following an Event of
Default, each of the Banks in connection with the enforcement of this Agreement
and the other Credit Documents and the documents and instruments referred to
herein and therein (including, without limitation, the reasonable fees and
disbursements of counsel for the Administrative Agent and, following an Event of
Default, for each of the Banks including any reasonable allocated costs of
in-house counsel); (ii) pay and hold each of the Banks harmless from and against
any and all present and future stamp, excise and other similar taxes with
respect to the foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any delay or
omission (other than to the extent attributable to such Bank) to pay such taxes;
and (iii) indemnify the Administrative Agent and each Bank, and each of their
respective officers, directors, employees, representatives and agents from and
hold each of them harmless against any and all liabilities, obligations
(including removal or remedial actions), losses, damages, penalties, claims,
actions, judgments, suits, costs, expenses and disbursements (including
reasonable attorneys' and consultants' fees and disbursements) incurred by,
imposed on or assessed against any of them as a result of, or arising out of, or
in any way related to, or by reason of, (a) any investigation, litigation or
other proceeding (whether or not the Administrative Agent or any Bank is a party
thereto) related to the entering into and/or performance of this Agreement or
any other Credit
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Document or the use of any Letter of Credit or the proceeds of any Loans
hereunder or the consummation of any transactions contemplated herein
(including, without limitation, the Transaction) or in any other Credit Document
or the exercise of any of their rights or remedies provided herein or in the
other Credit Documents, or (b) the non-compliance of any Real Property with
foreign, federal, state and local laws, regulations, and ordinances (including
applicable permits thereunder) applicable to any Real Property, owned or at any
time operated by Holdings or any of its Subsidiaries, including, in each case,
without limitation, the reasonable fees and disbursements of counsel and other
consultants incurred in connection with any such investigation, litigation or
other proceeding (but excluding in the case of each of clause (a) and (b) above,
any losses, liabilities, claims, damages or expenses to the extent incurred by
reason of the gross negligence or willful misconduct of the Person to be
indemnified). To the extent that the undertaking to indemnify, pay or hold
harmless the Administrative Agent or any Bank set forth in the preceding
sentence may be unenforceable because it is violative of any law or public
policy, the Borrower shall make the maximum contribution to the payment and
satisfaction of each of the indemnified liabilities which is permissible under
applicable law.
13.02 RIGHT OF SETOFF; COLLATERAL MATTERS. (a) In addition to any
rights now or hereafter granted under applicable law or otherwise, and not by
way of limitation of any such rights, upon the occurrence and continuance of an
Event of Default, each Bank is hereby authorized at any time or from time to
time, without presentment, demand, protest or other notice of any kind to
Holdings or the Borrower or to any other Person, any such notice being hereby
expressly waived, to set off and to appropriate and apply any and all deposits
(general or special) and any other Indebtedness at any time held or owing by
such Bank (including, without limitation, by branches and agencies of such Bank
wherever located) to or for the credit or the account of Holdings or the
Borrower against and on account of the Obligations and liabilities of Holdings
or the Borrower to such Bank under this Agreement or under any of the other
Credit Documents, including, without limitation, all interests in Obligations
purchased by such Bank pursuant to Section 13.06(b), and all other claims of any
nature or description arising out of or connected with this Agreement or any
other Credit Document, irrespective of whether or not such Bank shall have made
any demand hereunder and although said Obligations, liabilities or claims, or
any of them, shall be contingent or unmatured.
(b) NOTWITHSTANDING THE FOREGOING SUBSECTION (a), AT ANY TIME THAT
THE LOANS OR ANY OTHER OBLIGATION SHALL BE SECURED BY REAL PROPERTY LOCATED IN
CALIFORNIA, NO BANK SHALL EXERCISE A RIGHT OF SETOFF, BANKER'S LIEN OR
COUNTERCLAIM OR TAKE ANY COURT OR ADMINISTRATIVE ACTION OR INSTITUTE ANY
PROCEEDING TO ENFORCE ANY PROVISION OF THIS AGREEMENT OR ANY NOTE THAT IS NOT
TAKEN BY THE REQUIRED BANKS OR APPROVED IN WRITING BY THE REQUIRED BANKS IF SUCH
SETOFF OR ACTION OR PROCEEDING WOULD OR MIGHT (PURSUANT TO SECTIONS 580a, 580b,
580d AND 726 OF THE CALIFORNIA CODE OF CIVIL PROCEDURE OR SECTION 2924 OF THE
CALIFORNIA CIVIL CODE, IF APPLICABLE, OR OTHERWISE) AFFECT OR IMPAIR THE
VALIDITY, PRIORITY, OR ENFORCEABILITY OF THE LIENS GRANTED TO THE COLLATERAL
AGENT PURSUANT TO THE SECURITY DOCUMENTS OR THE ENFORCEABILITY OF THE NOTES AND
OTHER OBLIGATIONS HEREUNDER, AND ANY ATTEMPTED EXERCISE
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BY ANY BANK OF ANY SUCH RIGHT WITHOUT OBTAINING SUCH CONSENT OF THE REQUIRED
BANKS SHALL BE NULL AND VOID. THIS SUBSECTION (b) SHALL BE SOLELY FOR THE
BENEFIT OF EACH OF THE ADMINISTRATIVE AGENT, THE COLLATERAL AGENT AND THE BANKS
HEREUNDER AND SHALL NOT CREATE ANY RIGHTS FOR THE BENEFIT OF ANY CREDIT PARTY OR
ANY OTHER PERSON.
13.03 NOTICES. Except as otherwise expressly provided herein, all
notices and other communications provided for hereunder shall be in writing
(including telegraphic, telex, telecopier or cable communication) and mailed,
telegraphed, telexed, telecopied, cabled or delivered: if to Holdings, at
Holdings' address specified opposite its signature below; if to the Borrower, at
the Borrower's address specified opposite its signature below; if to any Bank,
at its address specified opposite its name below; and if to the Administrative
Agent, at its Notice Office; or, as to any Credit Party or the Administrative
Agent, at such other address as shall be designated by such party in a written
notice to the other parties hereto and, as to each Bank, at such other address
as shall be designated by such Bank in a written notice to the Borrower and the
Administrative Agent. All such notices and communications shall, when mailed,
be effective (5) Business Days after deposit in the mails, and when telegraphed,
telexed, telecopied, or cabled or sent by overnight courier, be effective one
Business Day after dispatch, except that notices and communications to the
Administrative Agent and the Borrower shall not be effective until received by
the Administrative Agent or the Borrower, as the case may be.
13.04 BENEFIT OF AGREEMENT. (a) This Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto; PROVIDED, HOWEVER, no Credit Party may assign
or transfer any of its rights, obligations or interest hereunder or under any
other Credit Document without the prior written consent of the Banks (it being
understood that this Section 13.04 shall not prevent a merger or consolidation
otherwise permitted by this Agreement) and, PROVIDED FURTHER, that, although any
Bank may transfer, assign or grant participations in its rights hereunder, such
Bank shall remain a "Bank" for all purposes hereunder (and may not transfer or
assign all or any portion of its Commitments hereunder except as provided in
Section 13.04(b)) and the transferee, assignee or participant, as the case may
be, shall not constitute a "Bank" hereunder and, PROVIDED FURTHER, that no Bank
shall transfer or grant any participation under which the participant shall have
rights to approve any amendment to or waiver of this Agreement or any other
Credit Document except to the extent such amendment or waiver would (i) extend
the final scheduled maturity of any Loan, Note or Letter of Credit (unless such
Letter of Credit is not extended beyond the Revolving Loan Maturity Date) in
which such participant is participating, or reduce the rate or extend the time
of payment of interest or Fees thereon (except in connection with a waiver of
applicability of any post-default increase in interest rates) or reduce the
principal amount thereof, or increase the amount of the participant's
participation over the amount thereof then in effect (it being understood that a
waiver of any Default or Event of Default or of a mandatory reduction in the
Total Commitment shall not constitute a change in the terms of such
participation, and that an increase in any Commitment or Loan shall be permitted
without the consent of any participant if the participant's participation is not
increased as a result thereof), (ii) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement or (iii)
release all or substantially all of the Collateral under all of the Security
Documents (except as expressly provided in the Credit Documents) supporting the
Loans hereunder in which such participant is participating. In the
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case of any such participation, the participant shall not have any rights under
this Agreement or any of the other Credit Documents (the participant's rights
against such Bank in respect of such participation to be those set forth in the
agreement executed by such Bank in favor of the participant relating thereto)
and all amounts payable by the Borrower hereunder shall be determined as if such
Bank had not sold such participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank together
with one or more other Banks) may (x) assign all or a portion of its Revolving
Loan Commitment (and related outstanding Obligations hereunder) and/or its
outstanding Term Loans (or, if prior to the Initial Borrowing Date, Term Loan
Commitment) to (i) its parent company and/or any affiliate of such Bank which is
at least 50% owned by such Bank or its parent company or to one or more Banks or
(ii) in the case of any Bank that is a fund that invests in bank loans, any
other fund that invests in bank loans and is managed by the same investment
advisor of such Bank or by an Affiliate of such investment advisor and (y)
assign all, or if less than all, a portion equal to at least $5,000,000 in the
aggregate for the assigning Bank or assigning Banks, of such Revolving Loan
Commitments and outstanding principal amount of Term Loans (or, if prior to the
Initial Borrowing Date, Term Loan Commitment) hereunder to one or more Eligible
Transferees (treating any fund that invests in bank loans and any other fund
that invests in bank loans and is managed by the same investment advisor of such
fund or by an Affiliate of such investment advisor as a single Eligible
Transferee), each of which assignees shall become a party to this Agreement as a
Bank by execution of an Assignment and Assumption Agreement, PROVIDED that, (i)
at such time Schedule I shall be deemed modified to reflect the Commitments
(and/or outstanding Term Loans, as the case may be) of such new Bank and of the
existing Banks, (ii) upon surrender of the old Notes, new Notes will be issued,
at the Borrower's expense, to such new Bank and to the assigning Bank, such new
Notes to be in conformity with the requirements of Section 1.05 (with
appropriate modifications) to the extent needed to reflect the revised
Commitments (and/or outstanding Term Loans, as the case may be), (iii) the
consent of the Administrative Agent shall be required in connection with any
such assignment (which consent shall not be unreasonably withheld) and (iv) the
Administrative Agent shall receive at the time of each such assignment, from the
assigning or assignee Bank, the payment of a non-refundable assignment fee of
$3,500 and, PROVIDED FURTHER, that such transfer or assignment will not be
effective until recorded by the Administrative Agent on the Register pursuant to
Section 13.17 hereof. To the extent of any assignment pursuant to this Section
13.04(b), the assigning Bank shall be relieved of its obligations hereunder with
respect to its assigned Commitments. At the time of each assignment pursuant to
this Section 13.04(b) to a person which is not already a Bank hereunder and
which is not a United States person (as such term is defined in Section
7701(a)(30) of the Code) for Federal income tax purposes, the respective
assignee Bank shall provide to the Borrower and the Administrative Agent the
appropriate Internal Revenue Service Forms (and, if applicable a Section
4.04(b)(ii) Certificate) described in Section 4.04(b). To the extent that an
assignment of all or any portion of a Bank's Commitments and related outstanding
Obligations pursuant to Section 1.13 or this Section 13.04(b) would, at the time
of such assignment, result in increased costs under Section 1.10, 1.11, 2.05 or
4.04 from those being charged by the respective assigning Bank prior to such
assignment, then the Borrower shall not be obligated to pay such increased costs
(although the Borrower shall be obligated to pay any other increased costs of
the type described above resulting from changes after the date of the respective
assignment).
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(c) Nothing in this Agreement shall prevent or prohibit any Bank from
pledging its Loans and Notes hereunder to a Federal Reserve Bank in support of
borrowings made by such Bank from such Federal Reserve Bank and, with the
consent of the Administrative Agent, any Bank which is a fund may pledge all or
any portion of its Loans and Notes to its trustee in support of its obligations
to its trustee.
13.05 NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the
part of the Administrative Agent or any Bank or any holder of any Note in
exercising any right, power or privilege hereunder or under any other Credit
Document and no course of dealing between the Borrower or any other Credit Party
and the Administrative Agent or any Bank or the holder of any Note shall operate
as a waiver thereof; nor shall any single or partial exercise of any right,
power or privilege hereunder or under any other Credit Document preclude any
other or further exercise thereof or the exercise of any other right, power or
privilege hereunder or thereunder. The rights, powers and remedies herein or in
any other Credit Document expressly provided are cumulative and not exclusive of
any rights, powers or remedies which the Administrative Agent or any Bank or the
holder of any Note would otherwise have. No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or further notice
or demand in similar or other circumstances or constitute a waiver of the rights
of the Administrative Agent or any Bank or the holder of any Note to any other
or further action in any circumstances without notice or demand.
13.06 PAYMENTS PRO RATA. (a) Except as otherwise provided in this
Agreement, the Administrative Agent agrees that promptly after its receipt of
each payment from or on behalf of the Borrower in respect of any Obligations
hereunder, it shall distribute such payment to the Banks (other than any Bank
that has consented in writing to waive its PRO RATA share of any such payment)
PRO RATA based upon their respective shares, if any, of the Obligations with
respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive any amount
hereunder (whether by voluntary payment, by realization upon security, by the
exercise of the right of setoff or banker's lien, by counterclaim or cross
action, by the enforcement of any right under the Credit Documents, or
otherwise), which is applicable to the payment of the principal of, or interest
on, the Loans, Unpaid Drawings, Commitment Commission or Letter of Credit Fees,
of a sum which with respect to the related sum or sums received by other Banks
is in a greater proportion than the total of such Obligation then owed and due
to such Bank bears to the total of such Obligation then owed and due to all of
the Banks immediately prior to such receipt, then such Bank receiving such
excess payment shall purchase for cash without recourse or warranty from the
other Banks an interest in the Obligations of the respective Credit Party to
such Banks in such amount as shall result in a proportional participation by all
the Banks in such amount; PROVIDED that if all or any portion of such excess
amount is thereafter recovered from such Bank, such purchase shall be rescinded
and the purchase price restored to the extent of such recovery, but without
interest.
(c) Notwithstanding anything to the contrary contained herein, the
provisions of the preceding Sections 13.06(a) and (b) shall be subject to the
express provisions of this Agreement which require, or permit, differing
payments to be made to Non-Defaulting Banks as opposed to Defaulting Banks.
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13.07 CALCULATIONS; COMPUTATIONS. (a) The financial statements to
be furnished to the Banks pursuant hereto shall be made and prepared in
accordance with generally accepted accounting principles in the United States
consistently applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to the
Banks); PROVIDED that, except as otherwise specifically provided herein, all
computations of Excess Cash Flow and all computations determining compliance
with Sections 9.07 through 9.11, inclusive, shall utilize accounting principles
and policies in conformity with those used to prepare the historical financial
statements delivered to the Banks pursuant to Section 7.05(a) (with the
foregoing generally accepted accounting principles, subject to the preceding
proviso, herein called "GAAP").
(b) All computations of interest payable at the Eurodollar Rate,
Commitment Commission and Fees hereunder shall be made on the basis of a year of
360 days for the actual number of days (including the first day but excluding
the last day) occurring in the period for which such interest, Commitment
Commission or Fees are payable. All computations of interest payable at the
Base Rate shall be made on the basis on a year of 365 (or 366, as applicable)
days for the actual number of days (including the first day but excluding the
last day) occurring in the period for which such interest is payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF
JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER AND THEREUNDER SHALL, EXCEPT AS
OTHERWISE PROVIDED IN CERTAIN OF THE MORTGAGES, BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. ANY LEGAL ACTION OR
PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION OF THE
AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER FURTHER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN
ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO ANY CREDIT PARTY AT ITS ADDRESS SET FORTH
OPPOSITE ITS SIGNATURE BELOW, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER
SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE ADMINISTRATIVE AGENT
UNDER THIS AGREEMENT, ANY BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST ANY CREDIT PARTY IN ANY OTHER JURISDICTION.
(b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY WAIVES ANY
OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY OF
THE AFORESAID ACTIONS OR
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PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER
CREDIT DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN
AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES
ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING
OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
13.09 COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
Administrative Agent.
13.10 EFFECTIVENESS. This Agreement shall become effective on the
date (the "Effective Date") on which the Borrower, the Administrative Agent and
each of the Banks shall have signed a counterpart hereof (whether the same or
different counterparts) and shall have delivered the same to the Administrative
Agent at its Notice Office or, in the case of the Banks, shall have given to the
Administrative Agent telephonic (confirmed in writing), written or telex notice
(actually received) at such office that the same has been signed and mailed to
it. The Administrative Agent will give the Borrower and each Bank prompt
written notice of the occurrence of the Effective Date.
13.11 HEADINGS DESCRIPTIVE. The headings of the several sections and
subsections of this Agreement are inserted for convenience only and shall not in
any way affect the meaning or construction of any provision of this Agreement.
13.12 AMENDMENT OR WAIVER; ETC. (a) Neither this Agreement nor any
other Credit Document nor any terms hereof or thereof may be changed, waived,
discharged or terminated unless such change, waiver, discharge or termination is
in writing signed by the respective Credit Parties party thereto and the
Required Banks, PROVIDED that no such change, waiver, discharge or termination
shall, without the consent of each Bank (other than a Defaulting Bank) (with
Obligations being directly affected), (i) extend the final scheduled maturity of
any Loan or Note or extend the Stated Maturity of any Letter of Credit beyond
the Revolving Loan Maturity Date, or reduce the rate or extend the time of
payment of interest or Fees thereon (except in connection with a waiver of
applicability of any post-default increase in interest rates), or reduce the
principal amount thereof (except to the extent repaid in cash), (ii) release all
or substantially all of the Collateral (except as expressly provided in the
Credit Documents) under all the Security Documents, (iii) amend, modify or waive
any provision of this Section 13.12, (iv) reduce the percentage specified in the
definition of Required Banks (it being understood that, with the consent of the
Required Banks, additional extensions of credit pursuant to this Agreement
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may be included in the determination of the Required Banks on substantially the
same basis as the extensions of Term Loans and Revolving Loan Commitments are
included on the Effective Date) or (v) consent to the assignment or transfer by
the Borrower of any of its rights and obligations under this Agreement; PROVIDED
FURTHER, that no such change, waiver, discharge or termination shall (1)
increase the Commitments of any Bank over the amount thereof then in effect
without the consent of such Bank (it being understood that waivers or
modifications of conditions precedent, covenants, Defaults or Events of Default
or of a mandatory reduction in the Total Commitment shall not constitute an
increase of the Commitment of any Bank, and that an increase in the available
portion of any Commitment of any Bank shall not constitute an increase in the
Commitment of such Bank), (2) without the consent of the Swingline Bank, amend,
modify or waive any provision relating to the rights or obligations of the
Swingline Bank or with respect to Swingline Loans (including, without
limitation, the obligations of the other Banks with Revolving Loan Commitments
to fund Mandatory Borrowings), (3) without the consent of the Administrative
Agent, amend, modify or waive any provision of Section 2 or alter its rights or
obligations with respect to Letters of Credit, (4) without the consent of the
Administrative Agent, amend, modify or waive any provision of Section 12 as same
applies to such Administrative Agent or any other provision as same relates to
the rights or obligations of such Administrative Agent, (5) without the consent
of the Collateral Agent, amend, modify or waive any provision relating to the
rights or obligations of the Collateral Agent, and (6) without the consent of
the Majority Banks of any Tranche of Term Loans, amend the definition of
Majority Banks with respect to such Tranche, or this clause (6), or alter the
required application of any prepayments or repayments (or commitment
reductions), as between the various Tranches, pursuant to Section 4.01 or
4.02(A) (excluding Sections 4.02(A)(b), (c) or (d)) with respect to such Tranche
(although the Required Banks may waive, in whole or in part, any such
prepayment, repayment or commitment reduction, except pursuant to Sections
4.02(A)(b), (c) or (d), so long as the application, as amongst the various
Tranches, of any such prepayment, repayment or commitment reduction which is
still required to be made is not altered).
(b) If, in connection with any proposed change, waiver, discharge or
termination to any of the provisions of this Agreement as contemplated by
clauses (i) through (v), inclusive, of the first proviso to Section 13.12(a),
the consent of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the Borrower
shall have the right, so long as all non-consenting Banks are treated as
described in clauses (A) or (B) below, to either (A) replace each such
non-consenting Bank or Banks with one or more Replacement Banks pursuant to
Section 1.13 so long as at the time of such replacement, each such Replacement
Bank consents to the proposed change, waiver, discharge or termination or (B)
terminate such non-consenting Bank's Revolving Loan Commitment and repay its
Loans, in accordance with Sections 3.02(b) and 4.01(v), respectively, PROVIDED
that in any event the Borrower shall not have the right to replace a Bank,
terminate its Revolving Loan Commitment or repay its Loans solely as a result of
the exercise of such Bank's rights (and the withholding of any required consent
by such Bank) pursuant to the second proviso to Section 13.12(a).
13.13 SURVIVAL. All indemnities set forth herein including, without
limitation, in Sections 1.10, 1.11, 2.05, 4.04, 13.01 and 13.06 shall, subject
to Section 13.15 (to the extent applicable), survive the execution, delivery and
termination of this Agreement and the Notes and the making and repayment of the
Loans.
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13.14 DOMICILE OF LOANS. Each Bank may transfer and carry its Loans
at, to or for the account of any office, Subsidiary or Affiliate of such Bank.
Notwithstanding anything to the contrary contained herein, to the extent that a
transfer of Loans pursuant to this Section 13.14 would, at the time of such
transfer, result in increased costs under Section 1.10, 1.11, 2.05 or 4.04 from
those being charged by the respective Bank prior to such transfer, then the
Borrower shall not be obligated to pay such increased costs (although the
Borrower shall be obligated to pay any other increased costs of the type
described above resulting from changes giving rise to such increased costs after
the date of the respective transfer to the extent such costs would have been
applicable had such transfer not occurred).
13.15 LIMITATION ON ADDITIONAL AMOUNTS, ETC. Notwithstanding
anything to the contrary contained in Section 1.10, 1.11, 2.05 or 4.04 of this
Agreement, unless a Bank gives notice to the Borrower that it is obligated to
pay an amount under the respective such Section within 180 days after the later
of (x) the date the Bank incurs the respective increased costs, Taxes, loss,
expense or liability, reduction in amounts received or receivable or reduction
in return on capital or (y) the date such Bank has actual knowledge of its
incurrence of the respective increased costs, Taxes, loss, expense or liability,
reductions in amounts received or receivable or reduction in return on capital,
then such Bank shall only be entitled to be compensated for such amount by the
Borrower pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be,
to the extent the costs, Taxes, loss, expense or liability, reduction in amounts
received or receivable or reduction in return on capital are incurred or
suffered on or after the date which occurs 180 days prior to such Bank giving
notice to the Borrower that it is obligated to pay the respective amounts
pursuant to said Section 1.10, 1.11, 2.05 or 4.04, as the case may be. This
Section 13.15 shall have no applicability to any Section of this Agreement other
than said Sections 1.10, 1.11, 2.05 and 4.04. Each Bank shall be entitled to be
compensated for amounts pursuant to Sections 1.10, 1.11, 2.05 and 4.04 only to
the extent such Bank makes the same demands for compensation from all of its
other customers facing the same or similar circumstances.
13.16 CONFIDENTIALITY. (a) Subject to the provisions of clause (b)
of this Section 13.16, each Bank agrees that it will not disclose without the
prior consent of Holdings or the Borrower (other than to its employees,
auditors, advisors or counsel or to another Bank if the Bank or such Bank's
holding or parent company in its sole discretion determines that any such party
should have access to such information in connection with this Agreement and the
Transaction, provided such Persons shall be subject to the provisions of this
Section 13.16 to the same extent as such Bank) any information with respect to
Holdings or any of its Subsidiaries which is now or in the future furnished
pursuant to this Agreement or any other Credit Document, PROVIDED that any Bank
may disclose any such information (a) as has become generally available to the
public, (b) as may be required or appropriate in any report, statement or
testimony submitted to any municipal, state or Federal regulatory body having or
claiming to have jurisdiction over such Bank or to the Federal Reserve Board or
the Federal Deposit Insurance Corporation or similar organizations (whether in
the United States or elsewhere) or their successors, (c) as may be required or
appropriate in respect to any summons or subpoena or in connection with any
litigation, (d) in order to comply with any law, order, regulation or ruling
applicable to such Bank, (e) to the Administrative Agent or the Collateral Agent
and (f) to any prospective or actual transferee or participant in connection
with any contemplated transfer or participation of any of the Notes or
Commitments or any interest therein by such Bank, PROVIDED
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that such prospective transferee agrees with such Bank on terms and conditions
substantially the same as those contained in this Section.
(b) Each of Holdings and the Borrower hereby acknowledges and agrees
that each Bank may share with any of its affiliates any information related to
Holdings or any of its Subsidiaries (including, without limitation, any
nonpublic customer information regarding the creditworthiness of Holdings and
its Subsidiaries, provided such Persons shall be subject to the provisions of
this Section 13.16 to the same extent as such Bank and provided such sharing of
information is undertaken in connection with this Agreement and the Transaction.
13.17 REGISTRY. The Borrower hereby designates the Administrative
Agent to serve as the Borrower's agent, solely for purposes of this Section
13.17, to maintain a register (the "Register") on which it will record the
Commitments from time to time of each of the Banks, the Loans made by each of
the Banks and each repayment in respect of the principal amount of the Loans of
each Bank. Failure to make any such recordation, or any error in such
recordation shall not affect the Borrower's obligations in respect of such
Loans. With respect to any Bank, the transfer of the Commitments of such Bank
and the rights to the principal of, and interest on, any Loan made pursuant to
such Commitments shall not be effective until such transfer is recorded on the
Register maintained by the Administrative Agent with respect to ownership of
such Commitments and Loans and prior to such recordation all amounts owing to
the transferor with respect to such Commitments and Loans shall remain owing to
the transferor. The registration of assignment or transfer of all or part of
any Commitments and Loans shall be recorded by the Administrative Agent on the
Register only upon the acceptance by the Administrative Agent of a properly
executed and delivered Assignment and Assumption Agreement pursuant to Section
13.04(b). Coincident with the delivery of such an Assignment and Assumption
Agreement to the Administrative Agent for acceptance and registration of
assignment or transfer of all or part of a Loan, or as soon thereafter as
practicable, the assigning or transferor Bank shall surrender the Note
evidencing such Loan, and thereupon one or more new Notes in the same aggregate
principal amount shall be issued to the assigning or transferor Bank and/or the
new Bank. The Borrower agrees to indemnify the Administrative Agent from and
against any and all losses, claims, damages and liabilities of whatsoever nature
which may be imposed on, asserted against or incurred by the Administrative
Agent in performing its duties under this Section 13.17.
SECTION 14. Holdings Guaranty.
14.01 THE GUARANTY. In order to induce the Banks to enter into this
Agreement and to extend credit hereunder and in recognition of the direct
benefits to be received by Holdings from the proceeds of the Loans and the
issuance of the Letters of Credit and to induce the Banks or any of their
respective Affiliates to enter into Interest Rate Protection Agreements,
Holdings hereby agrees with the Banks as follows: Holdings hereby
unconditionally and irrevocably guarantees as primary obligor and not merely as
surety the full and prompt payment when due, whether upon maturity, by
acceleration or otherwise, of any and all of the Guaranteed Obligations of the
Borrower to the Secured Creditors. If any or all of the Guaranteed Obligations
of the Borrower to the Secured Creditors becomes due and payable hereunder,
Holdings unconditionally promises to pay such indebtedness to the Secured
Creditors, or order, on demand, together with
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any and all reasonable expenses which may be incurred by the Administrative
Agent or the Secured Creditors in collecting any of the Guaranteed Obligations.
14.02 BANKRUPTCY. Additionally, Holdings unconditionally and
irrevocably guarantees the payment of any and all of the Guaranteed Obligations
of the Borrower to the Secured Creditors whether or not then due or payable by
the Borrower upon the occurrence in respect of the Borrower of any of the events
specified in Section 10.05, and unconditionally and irrevocably promises to pay
such Guaranteed Obligations to the Secured Creditors, or order, on demand, in
lawful money of the United States.
14.03 NATURE OF LIABILITY. The liability of Holdings hereunder is
exclusive and independent of any security for or other guaranty of the
Guaranteed Obligations of the Borrower whether executed by Holdings, any other
guarantor or by any other party, and the liability of Holdings hereunder shall
not be affected or impaired by (a) any direction as to application of payment by
the Borrower or by any other party, or (b) any other continuing or other
guaranty, undertaking or maximum liability of a guarantor or of any other party
as to the Guaranteed Obligations of the Borrower, or (c) any payment on or in
reduction of any such other guaranty or undertaking (except to the extent the
Guaranteed Obligations are partially or wholly satisfied as a result thereof),
or (d) any dissolution, termination or increase, decrease or change in personnel
by the Borrower, or (e) any payment made to the Administrative Agent or the
Secured Creditors on the indebtedness which the Administrative Agent or such
Secured Creditors repay the Borrower pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding, and
Holdings waives any right to the deferral or modification of its obligations
hereunder by reason of any such proceeding.
14.04 INDEPENDENT OBLIGATION. The obligations of Holdings hereunder
are independent of the obligations of any other guarantor or the Borrower, and a
separate action or actions may be brought and prosecuted against Holdings
whether or not action is brought against any other guarantor or the Borrower and
whether or not any other guarantor or the Borrower be joined in any such action
or actions. Any payment by the Borrower or other circumstance which operates to
toll any statute of limitations as to the Borrower shall operate to toll the
statute of limitations as to Holdings.
14.05 AUTHORIZATION. Holdings authorizes the Administrative Agent
and the Secured Creditors without notice or demand (except as shall be required
by applicable statute and cannot be waived), and without affecting or impairing
its liability hereunder, from time to time to:
(a) change the manner, place or terms of payment of, and/or change or
extend the time of payment of, renew, increase, accelerate or alter, any of the
Guaranteed Obligations (including any increase or decrease in the rate of
interest thereon), any security therefor, or any liability incurred directly or
indirectly in respect thereof, and the Guaranty herein made shall apply to the
Guaranteed Obligations as so changed, extended, renewed or altered;
(b) take and hold security for the payment of the Guaranteed
Obligations and sell, exchange, release, surrender, realize upon or otherwise
deal with in any manner and in any order any property by whomsoever at any time
pledged or mortgaged to secure, or howsoever securing,
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the Guaranteed Obligations or any liabilities (including any of those hereunder)
incurred directly or indirectly in respect thereof or hereof, and/or any offset
thereagainst;
(c) exercise or refrain from exercising any rights against the
Borrower or others or otherwise act or refrain from acting;
(d) release or substitute any one or more endorsers, guarantors, the
Borrower or other obligors;
(e) settle or compromise any of the Guaranteed Obligations, any
security therefor or any liability (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may subordinate the
payment of all or any part thereof to the payment of any liability (whether due
or not) of the Borrower to its creditors other than the Banks;
(f) apply any sums by whomsoever paid or howsoever realized to any
liability or liabilities of the Borrower to the Secured Creditors regardless of
what liability or liabilities of Holdings or the Borrower remain unpaid;
(g) consent to or waive any breach of, or any act, omission or
default under, this Agreement or any of the instruments or agreements referred
to herein, or otherwise amend, modify or supplement this Agreement or any of
such other instruments or agreements; and/or
(h) take any other action which would, under otherwise applicable
principles of common law, give rise to a legal or equitable discharge of
Holdings from its liabilities under the Holdings Guaranty.
14.06 RELIANCE. It is not necessary for the Administrative Agent or
the Secured Creditors to inquire into the capacity or powers of the Borrower or
its Subsidiaries or the officers, directors, partners or agents acting or
purporting to act on its behalf, and any Guaranteed Obligations made or created
in reliance upon the professed exercise of such powers shall be guaranteed
hereunder.
14.07 SUBORDINATION. Any of the indebtedness of the Borrower
relating to the Guaranteed Obligations now or hereafter owing to Holdings is
hereby subordinated to the Guaranteed Obligations of the Borrower owing to the
Administrative Agent and the Secured Creditors; and if the Administrative Agent
so requests at a time when an Event of Default exists, all such indebtedness
relating to the Guaranteed Obligations of the Borrower to Holdings shall be
collected, enforced and received by Holdings for the benefit of the Secured
Creditors and be paid over to the Administrative Agent on behalf of the Secured
Creditors on account of the Guaranteed Obligations of the Borrower to the
Secured Creditors, but without affecting or impairing in any manner the
liability of Holdings under the other provisions of this Guaranty. Prior to the
transfer by Holdings of any note or negotiable instrument evidencing any of the
indebtedness relating to the Guaranteed Obligations of the Borrower to Holdings,
Holdings shall xxxx such note or negotiable instrument with a legend that the
same is subject to this subordination. The provisions of this Section 14.07
(and any claims of Holdings as described above) are subject to the provisions of
Section 14.08(c) and (d).
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14.08 WAIVER. (a) Holdings waives any right (except as shall be
required by applicable statute and cannot be waived) to require the
Administrative Agent or the Secured Creditors to (i) proceed against the
Borrower, any other guarantor or any other party, (ii) proceed against or
exhaust any security held from the Borrower, any other guarantor or any other
party or (iii) pursue any other remedy in the Administrative Agent's or the
Secured Creditors' power whatsoever. Holdings waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or any other
party, other than payment in full of the Guaranteed Obligations, based on or
arising out of the disability of the Borrower, any other guarantor or any other
party, or the unenforceability of the Guaranteed Obligations or any part thereof
from any cause, or the cessation from any cause of the liability of the Borrower
other than payment in full of the Guaranteed Obligations. The Administrative
Agent and the Secured Creditors may, at their election, foreclose on any
security held by the Administrative Agent, the Collateral Agent or the Secured
Creditors by one or more judicial or nonjudicial sales, whether or not every
aspect of any such sale is commercially reasonable (to the extent such sale is
permitted by applicable law, including, but not limited to, the Communications
Acts), or exercise any other right or remedy the Administrative Agent and the
Secured Creditors may have against the Borrower or any other party, or any
security, without affecting or impairing in any way the liability of Holdings
hereunder except to the extent the Guaranteed Obligations have been paid.
Holdings waives any defense arising out of any such election by the
Administrative Agent and the Secured Creditors, even though such election
operates to impair or extinguish any right of reimbursement or subrogation or
other right or remedy of Holdings against the Borrower or any other party or any
security.
(b) Holdings waives all presentments, demands for performance,
protests and notices, including without limitation notices of nonperformance,
notices of protest, notices of dishonor, notices of acceptance of this Guaranty,
and notices of the existence, creation or incurring of new or additional
Guaranteed Obligations. Holdings assumes all responsibility for being and
keeping itself informed of the Borrower's financial condition and assets, and of
all other circumstances bearing upon the risk of nonpayment of the Guaranteed
Obligations and the nature, scope and extent of the risks which Holdings assumes
and incurs hereunder, and agrees that the Administrative Agent and the Secured
Creditors shall have no duty to advise Holdings of information known to them
regarding such circumstances or risks.
(c) Holdings understands that to the extent the Guaranteed
Obligations are secured by Real Property, Holdings shall be liable for the full
amount of the liability hereunder notwithstanding foreclosure on any such Real
Property by trustee sale or any other reason impairing Holdings' or any secured
creditors' right to proceed against the Borrower. Holdings hereby waives, to the
fullest extent permitted by applicable laws, all rights and benefits under
Sections 580a, 580b, 580d and 726 of the California Code of Civil Procedure. In
addition, Holdings hereby waives, to the fullest extent permitted by applicable
laws, without limiting the generality of the foregoing or any other provision
hereof, all rights and benefits which might otherwise be available to Holdings
under California Civil Code Sections 2787 through 2855 inclusive, 2899 and 3433.
(d) Holdings understands, is aware and hereby acknowledges that if
the Banks elect to foreclose on any of the Mortgaged Property security
nonjudicially, any right of
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subrogation of Holdings against the Borrower may be impaired or extinguished and
that as a result of such impairment or extinguishment of subrogation rights,
Holdings may have a defense to a deficiency judgment arising out of the
operation of Section 580d of the California Code of Civil Procedure and related
principles of estoppel. Holdings waives all rights and defenses arising out of
an election of remedies by the Banks, even though that election of remedies,
such as a nonjudicial foreclosure with respect to security for a guaranteed
obligation, has destroyed the guarantor's rights of subrogation and
reimbursement against the principal by the operation of Section 580d of the Code
of Civil Procedure or otherwise.
14.09 NATURE OF LIABILITY. It is the desire and intent of Holdings
and the Secured Creditors that this Holdings Guaranty shall be enforced against
Holdings to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought. If, however, and
to the extent that, the obligations of Holdings under this Holdings Guaranty
shall be adjudicated to be invalid or unenforceable for any reason (including,
without limitation, because of any applicable state or federal law relating to
fraudulent conveyances or transfers), then the amount of the Guaranteed
Obligations of Holdings shall be deemed to be reduced and Holdings shall pay the
maximum amount of the Guaranteed Obligations which would be permissible under
applicable law.
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IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the date first
above written.
ADDRESS:
GREAT LAKES ACQUISITION CORP.
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Tel: (000) 000-0000
Fax: (000) 000-0000
Attention: President
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Title:
with a copy to:
GREAT LAKES CARBON CORPORATION
Skadden, Arps, Slate,
Xxxxxxx & Xxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Title:
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000 Xxxxxxx Xxxxxx BANKERS TRUST COMPANY,
Xxx Xxxx, Xxx Xxxx 00000 Individually and as Administrative Agent
Tel: (000) 000-0000
Fax: (000) 000-0000 By: /S/ Xxxxxx Xxxxx
Attention: Xxxxxx Xxxxx -------------------------------------
Title: Vice President
000 Xxxx Xxxxxx XXX CAPITAL FUNDING, INC.,
Xxx Xxxx, Xxx Xxxx, 00000 Individually and as Documentation Agent
Tel: (000) 000-0000
Fax: (000) 000-0000 By: /s/ Xxxx Xxxxxxx
Attention: Xxxx Xxxxx -------------------------------------
Title: Managing Director
With a copy to:
XXXXXXXXX, LUFKIN & XXXXXXXX
2121 Avenue of the Stars
Suite 3000
Tel: (000) 000-0000
Fax: (000) 000-0000
Attention: Xxxxx Xxxxxx
000 Xxxxx XxXxxxx XXXX XX XXXXXXX NT&SA,
Xxxxxxx, Xxxxxxxx 00000 Individually and as Co-Agent
Tel: (000) 000-0000
Fax: (000) 000-0000 By: /s/ Xxxxx Xxxxxxxx
Attention: Xxxxx Xxxxxxxx -------------------------------------
Title: Vice President
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ABN AMRO BANK N.V.
San Francisco International Branch
By: /s/ Xxxxxx Xxxxxxx
-------------------------------------
Title: Group Vice President
By: /s/ Xxxx Xxxxxxxxx
-------------------------------------
Title: Vice President
BANKBOSTON, N.A.
By: /S/ C. Xxxxxx Xxxxxxxx
-------------------------------------
Title: Vice President
BANK OF TOKYO-MITSUBISHI TRUST COMPANY
By: /s/ Xxxxxxxx X. Xxxxxxxx
-------------------------------------
Title: Vice President
CREDITANSTALT CORPORATE FINANCE, INC.
By: Xxxxx X. Xxxxx
-------------------------------------
Title: Vice President
By: /s/ Xxxxxxxxx Xxxxxx
-------------------------------------
Title: Senior Vice President
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FLEET CAPITAL
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Title: Vice President
THE FUJI BANK, LIMITED
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Title: Vice President And Manager
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Title: Duly Authorized Signatory
XXXXXX FINANCIAL
By: /s/ Xxxxxxx Xxxxx
-------------------------------------
Title: Vice President
NATIONAL CITY BANK
By: /s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Title: Vice President
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TRANSAMERICA BUSINESS CREDIT CORPORATION
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Title: Senior Vice President
XXXXX FARGO BANK, N.A.
By: /s/ Xxxxxxx Xxxx
-------------------------------------
Title: Assistant Vice President
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