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EXHIBIT 10.3
MSX INTERNATIONAL, INC.
THE BORROWING SUBSIDIARIES PARTY HERETO,
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AMENDED AND RESTATED CREDIT AGREEMENT
dated as of April 14, 1998
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THE LENDERS PARTY HERETO
and
NBD BANK, as Agent
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THIS AMENDED AND RESTATED CREDIT AGREEMENT, dated as of April 14, 1998
(this "Agreement"), is by and among MSX INTERNATIONAL, INC., a Delaware
corporation (the "Company"), each of the Borrowing Subsidiaries (as defined
below) of the Company party hereto from time to time (the Company and the
Borrowing Subsidiaries may each be referred to as a "Borrower" and,
collectively, as the "Borrowers"), the lenders party hereto from time to time
(collectively, the "Lenders" and individually, a "Lender"), and NBD BANK, a
Michigan banking corporation, as agent for the Lenders (in such capacity, the
"Agent").
In consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree as follows:
RECITALS
A. The Borrowers, the Lenders and NBD Bank, as agent for the Lenders, executed a
Credit Agreement dated as of January 22, 1998 (the "Existing Credit Agreement").
B. The Borrowers have requested that the Lenders, including the Lenders becoming
a Lender on the date hereof, amend and restate the Existing Credit Agreement as
herein provided, and the Lenders are willing to establish such a credit facility
and change the Facility Fees in favor of the Borrowers and amend and restate the
Existing Credit Agreement on the terms and conditions herein set forth.
AGREEMENT
In consideration of the premises and of the mutual agreements herein
contained, the parties hereto agree that the Existing Credit Agreement shall be
amended and restated as follows:
ARTICLE I
DEFINITIONS
1.1. Certain Definitions. As used herein the following terms shall have
the following respective meanings:
"Acquisition" shall mean any transaction, or any series of related
transactions, consummated on or after the date of this Agreement, by which the
Company or any of its Subsidiaries (i) acquires any going business or all or
substantially all of the assets of any firm, corporation, partnership, limited
liability company or other business entity, or division thereof, whether through
purchase of assets, merger or otherwise or (ii) directly or indirectly acquires
(in one transaction or as the most recent transaction in a series of
transactions) at least a majority of the Capital Stock (by percentage or voting
power) of any Person.
"Advance" shall mean any Loan and any Letter of Credit Advance.
"Affiliate", when used with respect to any Person, shall mean any other
Person which, directly or indirectly, controls or is controlled by or is under
common control with such Person. For purposes of this definition "control"
(including the correlative meanings of the terms "controlled by" and "under
common control with"), with respect to any Person, shall mean possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such Person, whether through the ownership of voting
securities or by contract or otherwise. Without limiting the foregoing
definition of Affiliate, any Person shall be deemed to control another Person if
the controlling Person owns or controls 10% or more of any class of voting
securities (or other ownership interest of any kind) of the controlled Person.
MSX CREDIT AGREEMENT Page 1
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"Applicable Lending Installation" shall mean, with respect to any
office(s), branch(es), Subsidiary(ies) or Affiliate(s) of such Lender selected
by such Lender and notified to the Company and the Agent by such Lender from
time to time and, with respect to the Agent, any office(s), branch(es),
Subsidiary(ies) or Affiliate(s) of the Agent selected by the Agent and notified
to the Company and the Lenders.
"Applicable Margin" shall mean, (a) with respect to any Floating Rate Loan,
Eurodollar Loan, Eurocurrency Loan, Letter of Credit fee under Section
2.3(b)(i) and facility fee under Section 2.3(a), as the case may be, the
applicable percentage set forth in the applicable table below based upon the
Leverage Ratio, as adjusted on each date a certificate is required to be
delivered pursuant to Section 5.1(d)(ii) or (iii), with the first such change
to Applicable Margin being made based upon the Leverage Ratio for the fiscal
quarter of the Company ending June 30, 1998, and shall remain in effect until
the next change to be effected pursuant to this definition, based upon the
Leverage Ratio as of the last day of the most recently ended fiscal quarter,
provided that (a) if any Event of Default has occurred and is continuing the
Leverage Ratio as of the end of the most recently ended fiscal quarter shall,
for the purposes of this definition, be deemed to be greater than 4.25, and (b)
as of the Effective Date, the Applicable Margin shall be based upon a Leverage
Ratio of greater than 4.25.
======================================================================================================================
APPLICABLE MARGIN
---------------- -------------- -------------------- ------------------------------- ------------- -------------------
Eurodollar Revolving Loan, Floating
Floating Rate Eurocurrency Revolving Loan Rate Term Eurodollar Term
Leverage Ratio Facility Fee Revolving Loan and Letter of Credit Fee Loan Loan
--------------- ------------- -------------------- ------------------------------- ------------- ===================
<=2.00:1 17.5 bps 0 bps 45 bps 0 bps 62.5 bps
>2.0 but
<=2.75:1 20 bps 0 bps 67.5 bps 0 bps 87.5 bps
>2.75 but
<=3.50:1 25 bps 0 bps 100 bps 0 bps 125 bps
>3.50 but
<=4.25:1 30 bps 0 bps 120 bps 0 bps 150 bps
>4.25 35 bps 0 bps 140 bps 0 bps 175 bps
"Assignment and Acceptance" is defined in Section 9.6(c).
"Benefit Arrangement" shall mean at any time an employee benefit plan
within the meaning of Section 3(3) of ERISA which is not a Plan or a
Multiemployer Plan and which is maintained or otherwise contributed to by any
member of the ERISA Group.
"Board of Directors" shall mean the Board of Directors of the Company, or
any authorized committee of the Board of Directors.
"Borrowing" shall mean the aggregation of Advances, including each Letter
of Credit Advance, of the Lenders to be made to a Borrower, or continuations
and conversions of such Loans, made pursuant to Article II on a single date
and, in the case of any Fixed Rate Loans, of a single type and for a single
Interest
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Period, which Borrowings may be classified for purposes of this Agreement by
reference to the type of Loans or the type of Advances comprising the related
Borrowing, e.g., a "Eurodollar Borrowing" is a Borrowing comprised of Eurodollar
Loans and a "Letter of Credit Borrowing" is an Advance comprised of a single
Letter of Credit.
"Borrowing Base" shall mean, as of any date, an amount equal to the sum
of (a) 85% of the amount of Eligible Accounts Receivable and (b) 65% of the
amount of Eligible Unbilled Receivables; provided, however, that not more than
25% of the amount of the Borrowing Base may be attributable to assets on which
the Agent, for the benefit of the Agent and the Lenders, does not have an
enforceable, perfected and first priority security interest which is not void or
voidable pursuant to a Security Agreement.
"Borrowing Base Certificate" for any date shall mean an appropriately
completed report as of such date and substantially in the form of Exhibit A
hereto, certified as true and correct as of such date by a duly authorized
officer of the Company.
"Borrowing Base Condition" shall be deemed to exist at any time that:
(i) the Leverage Ratio is equal to or in excess of 3.50:1, and
(ii) the Dollar Equivalent of the aggregate principal amount of the
Revolving Credit Advances plus the Term Loan is equal to or in
excess of $35,000,000.
"Borrowing Subsidiary" shall mean each Subsidiary listed as a Subsidiary
Borrower in Schedule 1.1(a) as amended from time to time in accordance with
Section 9.1.
"Business Day" shall mean (a) when such term is used in respect of a day on
which a Loan denominated in an Eligible Currency is to be made, a payment is
to be made in respect of such Loan or any other dealing in such Eligible
Currency is to be carried out pursuant to this Agreement, such term shall mean
a LIBOR Business Day which is also a day on which banks are open for
general banking business in the city which is the principal financial center of
the country of issuance of such Eligible Currency; (b) when such term is used
to describe a day on which a borrowing, payment or interest rate determination
is to be made in respect of a Eurodollar Loan, such day shall be a LIBOR
Business Day; and (c) when such term is used in any context in this Agreement
(including as described in the foregoing clauses (a) and (b)), such term shall
mean a day which, in addition to complying with any applicable requirements set
forth in the foregoing clauses (a) and (b), is a day other than a Saturday,
Sunday or other day on which commercial banks in Chicago, Detroit or New York
are authorized or required by law to close.
"Capital Expenditures" shall mean, for any period, the additions to
property, plant and equipment and other capital expenditures of the Company and
its Subsidiaries for such period, as the same are (or should be) set forth, in
accordance with Generally Accepted Accounting Principles, in consolidated
financial statements of the Company and its Subsidiaries for such period but
excluding any such additions made with insurance or condemnation proceeds.
"Capital Lease" of any Person shall mean any lease which, in accordance
with Generally Accepted Accounting Principles, is or should be capitalized on
the books of such Person.
"Capital Stock" shall mean (i) in the case of any corporation, all capital
stock (whether common, preferred or any other type) and any securities
exchangeable for or convertible into capital stock and any warrants, rights or
other options to purchase or otherwise acquire capital stock or such securities
or any other form of equity securities, (ii) in the case of an association or
business entity, any and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock, (iii) in the
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case of a partnership or limited liability company, partnership or membership
interests (whether general or limited) and (iv) any other interest or
participation that confers on a Person the right to receive a share of the
profits and losses of, or distribution of assets of, the issuing Person.
"Cash Equivalent" shall mean (i) cash in Dollars or, so long as not held
for speculative purposes, any Eligible Currency, (ii) securities issued or
directly and fully guaranteed or insured by the United States government or any
agency or instrumentality thereof having maturities of not more than six months
from the date of acquisition, (iii) marketable direct obligations issued by any
state of the United States of America or any political subdivision of any such
state or any public instrumentality thereof maturing within one year from the
date of acquisition thereof and, at the time of acquisition, having one of the
two highest ratings obtainable from either Standard & Poor's Corporation
("S&P") or Xxxxx'x Investors Service, Inc. ("Moody's"), (iv) certificates of
deposit and eurodollar time deposits with maturities of six months or less from
the date of acquisition, bankers' acceptances with maturities not exceeding six
months and overnight bank deposits, in each case with any Lender or with any
domestic commercial bank or U.S. branch of a foreign bank licensed under the
laws of the United States or a State thereof having capital and surplus in
excess of $250,000,000 and a Xxxxx Bank Watch Rating of "B" or better, and
overnight bank deposits with reputable foreign commercial banks, (v) repurchase
obligations with a term of not more than seven days for underlying securities
of the types described in clauses (ii), (iii) and (iv) above entered into with
any financial institution meeting the qualifications specified in clause (iv)
above, (vi) commercial paper having one of the two highest ratings obtained
from Moody's or S&P and in each case maturing within six months after the date
of acquisition and (vii) investments in money market funds which invest
substantially all their assets in securities of the type described in clauses
(i) through (vii) above.
"Change of Control" shall mean the occurrence of any of the following:
(i) prior to the first public offering of Voting Stock of the Company,
the Permitted Investors cease to be entitled (by "beneficial ownership" (as
defined in Rules 13d-3 and 13d-5 under the Exchange Act) of Voting Stock,
contract or otherwise) to elect or cause the election of directors having, a
majority in the aggregate of the total voting power of the Board of Directors,
whether as a result of issuance of securities of the Company, any merger,
consolidation, liquidation or dissolution of the Company, any direct or
indirect transfer of securities by the Permitted Investors or otherwise (for
purposes of this clause (i) and clause (ii) below, the Permitted Investors
shall be deemed to beneficially own any Voting Stock of any entity (the
"specified entity") held by any other entity (the "parent entity") so long as
the Permitted Investors beneficially own (as so defined), directly or
indirectly, in the aggregate a majority of the voting power of the Voting Stock
of the parent entity);
(ii) after the first public offering of Voting Stock of the Company,
any "person" (as such term is used in Sections 13(d) and 14(d) of the Exchange
Act), other than one or more Permitted Holders, is or becomes the beneficial
owner (as defined in clause (i) above, except that for purposes of this
clause (ii) such person shall be deemed to have "beneficial ownership" of all
shares that any such person has the right to acquire, directly or indirectly),
of more than 35% of the total voting power of the Voting Stock of the Company
and either (x) the Permitted Holders beneficially own (as defined in clause (i)
above) directly or indirectly, in the aggregate a lesser percentage of the
total voting power of the Voting Stock of the Company than such other person
and do not have the right or ability by voting power, contract or otherwise to
elect or designate for election a majority of the Board of Directors or (y)
such other person is entitled to elect directors having a majority of the total
voting power of the Board of Directors;
(iii) after the first public offering of Voting Stock of the Company,
during any period of not greater than two consecutive years beginning after the
Effective Date, individuals who at the beginning of such period constituted the
Board of Directors (together with any new directors whose election by such
Board
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of Directors or whose nomination for election by the shareholders of the Company
was approved by a vote of a majority of the directors of the Company then still
in office who were either 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 Board of Directors then in office; or
(iv) any "Change of Control" or similar term, as defined in the
Senior Subordinated Note Indenture.
"Code" shall mean the Internal Revenue Code of 1986, as amended from time
to time, and the regulations promulgated thereunder.
"Commitments" shall mean, with respect to each Lender, the commitment of
each such Lender to make Revolving Credit Loans, Term Loans and to participate
in Letter of Credit Advances, in amounts not exceeding in the aggregate
principal or face amount outstanding at any time the Commitment amount for such
Lender set forth next to the name of such Lender on the signature pages hereof,
or, as to any Lender becoming a party hereto after the Effective Date, as set
forth in the applicable Assignment and Acceptance, in each case as reduced
pursuant to Section 2.2 or modified pursuant to Section 9.6.
"Consent and Amendment" shall mean the Consent and Amendment of Security
Documents dated as of April 14, 1998 by each of the Borrowers and Guarantors
in favor of the Agent and the Lenders.
"Consolidated" or "consolidated" shall mean, when used with reference to
any financial term in this Agreement, the aggregate for two or more Persons of
the amounts signified by such term for all such Persons determined on a
consolidated basis in accordance with Generally Accepted Accounting Principles.
"Contingent Liabilities" shall mean as to any Person any obligation of
such Person guaranteeing or intended to guarantee any indebtedness, obligations
and liabilities ("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, (a) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligator, (c) 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 (d) otherwise to assure or hold harmless the owner of such primary
obligation against loss in respect thereof, provided however, that the term
Contingent Liabilities shall not include endorsements of instruments for deposit
or collection in the ordinary course of business; provided further, that, for
purposes of calculating the financial covenants contained in Sections 5.2(a)
through (c), Contingent Liabilities shall be only those Contingent Liabilities
that are described in clause (iv) of the definition of Total Debt. The amount of
any Contingent Liability shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Liability is made 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.
"Contractual Obligation" shall mean, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"CVC" shall mean Citicorp Venture Capital, Ltd., a New York corporation.
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"CVC Investor" shall mean (i) CVC, (ii) Citicorp, N.A. and (iii) any
officer, employee, or director of CVC so long as such person shall be an
employee, officer or director of CVC.
"Defaulting Lender" shall mean any Lender that fails to make available to
the Agent such Lender's Loans required to be made hereunder or shall have not
made a payment required to be made to the Agent hereunder. Once a Lender becomes
a Defaulting Lender, such Lender shall continue as a Defaulting Lender until
such time as such Defaulting Lender makes available to the Agent the amount of
such Defaulting Lender's Loans and all other amounts required to be paid to the
Agent pursuant to this Agreement.
"Deutsche Marks" or "DM" means the lawful money of the Republic of Germany.
"Disqualified Stock" shall mean any Capital Stock that, by its terms (or
by the terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at
the option of the holder thereof, in whole or in part prior to a date one year
after the Termination Date.
"Dollar Equivalent" shall mean as of any date, with respect to any amount
in a currency other than Dollars, the sum in Dollars resulting from the
conversion of such amount from such currency into Dollars at the most favorable
spot exchange rate determined by the Agent to be available to it for the
purchase of such currency with Dollars at approximately 11:00 a.m. local time of
the Applicable Lending Installation on such date as a determination of the
Dollar Equivalent is made.
"Dollars" and "$" shall mean the lawful money of the United States of
America.
"Domestic Subsidiary" shall mean each present and future Subsidiary of the
Company which is not a Foreign Subsidiary.
"EBITDA" shall mean, for any period, Net Income for such period plus all
amounts deducted in determining such Net Income on account of (a) Total
Interest Expense, (b) income taxes (including Michigan Single Business Tax
expense), and (c) depreciation and amortization expense, all as determined for
the Company and its Subsidiaries on a consolidated basis in accordance with
Generally Accepted Accounting Principles.
"Effective Date" shall mean the effective date specified in the final
paragraph of this Agreement.
"Eligible Accounts Receivable" shall mean, as of any date, those accounts
receivable evidenced by an invoice owned by the Company or any Subsidiary which
are payable in Dollars or in any currency that is readily available, freely
traded and convertible into Dollars (valued at the Dollar Equivalent thereof)
valued at the face amount thereof less sales, excise or similar taxes
outstanding and (to the extent not deducted pursuant to clauses (a) through (j)
below) less returns, discounts, credits and allowances of any nature at any
time claimed in writing or issued, owing or granted; but shall not include any
such account receivable (a) that is not a bona fide existing obligation created
by the sale and actual delivery of inventory, goods or other property or the
furnishing of services or other good and sufficient consideration to customers
of the Company or any Subsidiary, as the case may be, in the ordinary course of
business, (b) that is more than 90 days past due or that contains any deferred
payment terms or dating terms outside the ordinary course of business and not
customarily included by the Company or its Subsidiaries or not acceptable to
the Agent (acting in a commercially reasonable manner), (c) that is subject to
any dispute, contra-account, defense, offset or counterclaim or any Lien
(except those in favor of the Agent under the Security Documents), or the
inventory, goods, property, services or other consideration of which such
account receivable constitutes proceeds are subject to any such Lien, but only
to the extent of such dispute, contra-account, defense, offset,
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counterclaim or Lien, (d) in respect of which the inventory, goods, property,
services or other consideration have been rejected or the amount is in dispute,
but only to the extent of such dispute, (e) that is due from any Affiliate
(other than MascoTech or any of the consolidated Subsidiaries of MascoTech) or
Subsidiary of the Company, (f) that is payable by the United States or any of
its departments, agencies or instrumentalities or by any state or other
governmental entity or by any foreign government unless the Company or such
Subsidiary, as the case may be, if requested by the Agent fully complies with
the Assignment of Claims Act and executes all documents and agreements and
causes all documents and agreements to be executed in connection therewith or
any similar foreign statute in the case of accounts receivable payable by a
foreign government, (g) that is payable by any Person as to which 25% or more of
the aggregate amount of such accounts receivable payable by such Person to the
Company or any Subsidiary, as the case may be, do not otherwise constitute
Eligible Accounts Receivable pursuant to clause (b) of this definition, (h) that
are payable by any Person that is the subject of any proceeding seeking to
adjudicate it a bankrupt or insolvent or seeking liquidation, winding up or
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief or protection of debtors or seeking the appointment of a receiver,
trustee, custodian or other similar official for it or for any substantial part
of its property, or that is not generally paying its debts as they become due or
has admitted in writing its inability to pay its debts generally or has made a
general assignment for the benefit of creditors, (i) which is evidenced by a
promissory note or other instrument, or (j) that for any other reason is at any
time deemed by the Agent (acting in a commercially reasonable manner) to be
ineligible.
"Eligible Currency" shall mean Francs, Deutsche Marks, Pounds Sterling
and any other currency (other than Dollars) which is approved and designated as
an Eligible Currency by the Agent and the Lenders, provided that each of the
foregoing currencies is and remains readily available, freely traded, in which
deposits are customarily offered to banks in the London interbank market,
convertible into Dollars in the international interbank market and as to which
the Dollar Equivalent may be readily calculated. If, after the designation of
any currency as an Eligible Currency, currency control or other exchange
regulations are imposed in the country in which such currency is issued with the
result that different types of such currency are introduced, or such country's
currency is, in the determination of the Agent, no longer readily available or
freely traded or as to which, in the determination of the Agent, a Dollar
Equivalent is not readily calculable, then the Agent shall promptly notify the
Company and such country's currency shall no longer be an Eligible Currency
until such time as the Agent agrees to reinstate such country's currency as an
Eligible Currency and promptly, but in any event within five (5) Business Days
of receipt of such notice from the Agent, the Borrowers with respect to such
Currency shall repay all Loans in such affected currency or convert such Loans
into Loans in Dollars or an Eligible Currency, as applicable, subject to the
other terms contained in this Agreement.
"Eligible Unbilled Receivables" shall mean, as of any date, those
obligations owing the Company or any Subsidiary which would constitute an
Eligible Account Receivable (valued at the Dollar Equivalent thereof) but for
the fact that an invoice has not been sent by the Company or Subsidiary,
provided that each of the following conditions is satisfied for each such
obligation: (a) such obligation is covered under a written work order or other
agreement between the Company or such Subsidiary and the Person owing such
obligation, including price verification, which is binding and enforceable on
such Person to pay such obligation, (b) such obligation has not been classified
as an Eligible Unbilled Receivable for more than 120 days and (c) such
obligation is not at any time otherwise deemed by the Agent (acting in a
commercially reasonable manner) to be ineligible.
"Environmental Certificate" shall mean an appropriately completed
environmental certificate in the form of Exhibit B attached hereto delivered by
the Borrowers and the Guarantors.
"Environmental Laws" at any date shall mean all provisions of law,
statutes, ordinances, rules, regulations, judgments, writs, injunctions,
decrees, orders, awards and standards promulgated by the
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government of the United States of America or any foreign government or by any
state, province, municipality or other political subdivision thereof or therein
or by any court, agency, instrumentality, regulatory authority or commission of
any of the foregoing concerning the protection of, or regulating the discharge
of hazardous substances into, the environment.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations thereunder.
"ERISA Group" means the Company, its Subsidiaries and all members of a
controlled group of corporations and all trades or businesses (whether or not
incorporated) under common control which, together with the Company or any
Subsidiary, are treated as a single employer under Section 414 of the Code.
"Eurocurrency Base Rate" shall mean, with respect to each Interest Period
for a Eurocurrency Loan, the rate per annum obtained by dividing (i) the per
annum interest rates at which deposits in the relevant Eligible Currency are
offered to the Applicable Lending Installation of the Agent by other prime banks
in the London interbank market in an amount comparable to the Agent's (or the
Agent's Affiliate's) portion of such Eurocurrency Loan and for a period equal to
such Interest Period at approximately 11:00 a.m. London time two (2) Business
Days prior to the first day of such Interest Period, divided by (ii) an amount
equal to one minus the stated maximum rate (expressed as a decimal) of all
reserve requirements (including, without limitation, any marginal, emergency,
supplemental, special or other reserves) and other fees, charges and other
requirements similar thereto or the functional equivalent thereof which the
Agent determines to be market practice to take into account in determining the
Eurocurrency Base Rate that are specified on the first day of such Interest
Period by the Board of Governors of the Federal Reserve System (or any successor
agency thereto) for determining the maximum reserve requirement with respect to
Eurocurrency funding (currently referred to as "Eurocurrency liabilities" in
Regulation D of such Board) maintained by a member bank of such System or by any
other governmental entity, foreign or domestic, all as conclusively determined
by the Agent (absent manifest error), such sum to be rounded up, if necessary,
to the nearest whole multiple of one sixteenth of one percent (1/16 of 1%);
provided that with respect to any Eurocurrency Loans, an alternative formula
shall apply if (a) the Borrower and the Agent shall have agreed to such
alternative formula, (b) such formula is based on the rate determined pursuant
to clause (i) above and (c) the Agent shall have determined that such
alternative formula more accurately compensates Lenders for the cost of
maintaining reserves and similar requirements in respect of such Eurocurrency
Loans.
"Eurocurrency Loan" shall mean a Loan which bears interest at the
Eurocurrency Rate.
"Eurocurrency Rate" shall mean, with respect to each day during each
Interest Period pertaining to a Eurocurrency Loan, the sum of (a) the Applicable
Margin for such day plus (b) the Eurocurrency Base Rate for such Interest
Period.
"Eurocurrency Revolving Loan" shall mean a Revolving Credit Loan which
bears interest at the Eurocurrency Rate.
"Eurodollar Base Rate" shall mean the rate per annum obtained by dividing
(i) the per annum rate of interest at which deposits in Dollars for such
Interest Period and in an aggregate amount comparable to the amount of such
Eurodollar Loan to be made by the Agent are offered to the Agent (or any
Affiliate of the Agent which is a Lender hereunder) by other prime banks in the
London interbank market at approximately 11:00 a.m. local time in London on the
second LIBOR Business Day prior to the first day of such Interest Period by (ii)
an amount equal to one minus the stated maximum rate (expressed as a decimal) of
all reserve requirements (including, without limitation, any marginal,
emergency, supplemental, special
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or other reserves) that is specified on the first day of such Interest Period by
the Board of Governors of the Federal Reserve System (or any successor agency
thereto) for determining the maximum reserve requirement with respect to
eurocurrency funding (currently referred to as "Eurocurrency liabilities" in
Regulation D of such Board) maintained by a member bank of such System; all as
conclusively determined by the Agent, such sum to be rounded up, if necessary,
to the nearest whole multiple of one one-hundredth of one percent (1/100 of 1%).
"Eurodollar Loan" shall mean a Loan which bears interest at a Eurodollar
Rate.
"Eurodollar Rate" shall mean, with respect to any Eurodollar Loan and for
each day during the related Interest Period, the per annum rate that is equal
to the sum of (a) the Applicable Margin for such day, plus (b) the Eurodollar
Base Rate for such Interest Period.
"Eurodollar Revolving Loan" shall mean a Revolving Credit Loan which bears
interest at a Eurodollar Rate.
"Eurodollar Term Loan" shall mean a Term Loan which bears interest at a
Eurodollar Rate.
"Event of Default" shall mean any of the events or conditions described in
Section 6.1.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
"Excluded Collateral" is defined in Section 2.10(a).
"Federal Funds Rate" shall mean, for any day, an interest rate per annum
equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Detroit
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion or, when used in connection with any Advance in any Eligible
Currency, "Federal Funds Rate" shall mean, for any day, an interest rate per
annum equal to the local cost of funds rate for obligations in such currency as
determined by the Agent..
"Financial Contract" of a Person shall mean (i) any exchange-traded or
over-the-counter futures, forward, swap or option contract or other financial
instrument with similar characteristics, or (ii) any agreements, devices or
arrangements providing for payments related to fluctuations of interest rates,
exchange rates or forward rates, including, but not limited to, interest rate
exchange agreements, forward currency exchange agreements, interest rate cap or
collar protection agreements, forward rate currency or interest rate options.
"Fixed Charge Coverage Ratio" shall mean, as of the last day of any fiscal
quarter of the Company, the ratio of (a) EBITDA plus Rental Charges, minus
Capital Expenditures, to (b) Fixed Charges, in each case as calculated for the
four consecutive fiscal quarters then ending, all as determined in accordance
with Generally Accepted Accounting Principles.
"Fixed Charges" shall mean, for any period, the sum, without duplication,
of (a) Total Interest Expense plus (b) all payments of principal and other
sums scheduled to be paid during such period by the Company or its Subsidiaries
with respect to Indebtedness of the Company or its Subsidiaries, plus (c)
Rental Charges accrued during such period by the Company and its Subsidiaries,
plus (d) all dividends, distributions and other obligations paid (other than
those paid with common stock) with respect to any
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class of the Company's Capital Stock or any dividend, payment or distribution
paid (other than those paid with common stock) in connection with the
redemption, purchase, retirement or other acquisition, directly or indirectly,
of any shares of the Company's Capital Stock, plus (e) all accrued income taxes
(including Michigan Single Business Tax expense) for such period for the Company
or its Subsidiaries (but excluding all deferred income taxes unless paid or
payable in such period).
"Fixed Rate Loan" shall mean any Eurocurrency Loan or Eurodollar Loan.
"Floating Rate" shall mean the per annum rate equal to the sum of (a) the
Applicable Margin, plus (b) the greater of the Prime Rate or the sum of the
Federal Funds Rate plus 1%, in each case as in effect from time to time, which
Floating Rate shall change simultaneously with any change in such Prime Rate or
Federal Funds Rate, as the case may be.
"Floating Rate Loan" shall mean any Loan which bears interest at the
Floating Rate.
"Floating Rate Revolving Loan" shall mean any Revolving Credit Loan which
bears interest at the Floating Rate.
"Floating Rate Term Loan" shall mean any Term Loan which bears interest
at the Floating Rate.
"Foreign Subsidiary" shall mean any Subsidiary incorporated or formed in
any jurisdiction other than any State of the United States of America.
"Francs" or "FF" shall mean the lawful money of France.
"Generally Accepted Accounting Principles" shall mean generally accepted
accounting principles as in effect from time to time, applied on a basis
consistent (except for changes concurred in by the Company's independent
public accountants) with the most recent audited consolidated financial
statements of the Company and its Subsidiaries delivered to the Lenders.
"Guaranties" shall mean the guaranties entered into by each of the
Guarantors for the benefit of the Agent and the Lenders pursuant to this
Agreement in substantially the form of Exhibit C hereto, as amended by the
Consent and Amendment and as further amended or modified from time to time.
"Guarantor" shall mean each present and future Domestic Subsidiary of the
Company, which is a Significant Subsidiary, each "Subsidiary Guarantor" as
defined in the Senior Subordinated Debt Documents or any other guarantor with
respect to any Subordinated Debt at any time or any other Person executing a
Guaranty at any time.
"Indebtedness" of any Person shall mean, as of any date, (a) all
obligations of such Person for borrowed money or evidenced by bonds, notes,
debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or bankers' acceptances, (b) all obligations of
such Person as lessee which are capitalized in accordance with Generally
Accepted Accounting Principles under any Capital Lease, (c) all obligations
which are secured by any Lien existing on any asset or property of such Person
whether or not the obligation secured thereby shall have been assumed by such
Person, (d) the unpaid purchase price for goods, property or services acquired
by such Person, except for trade accounts and accrued expenses payable arising
in the ordinary course of business which are not past due within customary
payment terms, and (e) all Contingent Liabilities of such Person with respect to
or relating to Indebtedness of others similar in character to those described in
clauses (a) through (d) of this definition; provided that bank overdrafts in the
United States in the ordinary course of business and which are not
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material in the aggregate and are outstanding for less than 3 Business Days
shall be excluded from this definition.
"Interest Payment Date" shall mean (a) with respect to any Fixed Rate Loan,
the last day of each Interest Period with respect to such Fixed Rate Loan, and,
in the case of any Interest Period exceeding three months, those days that
occur during such Interest Period at intervals of three months after the first
day of such Interest Period and (b) in all other cases, the first Business Day
of each fiscal quarter of the Company occurring after the date hereof,
commencing with the first such Business Day occurring after the date of this
Agreement.
"Interest Period" means with respect to any Eurodollar Loan or Eurocurrency
Loan:
(a) initially, the period commencing on the borrowing or
conversion date, as the case may be, with respect to such Eurodollar
Loan or Eurocurrency Loan and ending one, two, three, or six months
thereafter, as selected by the relevant Borrower in its notice of
borrowing or notice of conversion, as the case may be, given with
respect thereto, provided that prior to the syndication of this
Agreement as determined by the Agent, the Borrowers shall be permitted
to elect Interest Periods for periods of time between 7 and 14 days and
may not elect any Interest Period in excess of 14 days until the
earlier of completion of the syndication of this Agreement as
determined by the Agent or 90 days after the Effective Date; and
(b) thereafter, each period commencing on the last day of the
next preceding Interest Period applicable to such Eurodollar Loan or
Eurocurrency Loan and ending one, two, three or six months thereafter,
as selected by the relevant Borrower by irrevocable notice to the Agent
not less than three Business Days prior to the last day of the then
current Interest Period with respect thereto;
provided that, all of the foregoing provisions relating to Interest
Periods are subject to the following:
(i) if any Interest Period pertaining to a Eurodollar
Loan or Eurocurrency Loan would otherwise end on a day that is
not a Business Day, such Interest Period shall be extended to
the next succeeding Business Day unless the result of such
extension would be to carry such Interest Period into another
calendar month in which event such Interest Period shall end
on the immediately preceding Business Day;
(ii) any Interest Period applicable to a Eurodollar
Loan or Eurocurrency Loan that would otherwise extend beyond
the Termination Date, shall end on the Termination Date;
(iii) any Interest Period pertaining to a Eurodollar
Loan or Eurocurrency Loan that begins on the last Business Day
of a calendar month (or on a day for which there is no
numerically corresponding day in the calendar month at the end
of such Interest Period) shall end on the last Business Day of
a calendar month; and
(iv) any Interest Period pertaining to a Eurocurrency
Loan denominated in an Eligible Currency being replaced by the
currency of the European Monetary Union that would otherwise
extend beyond the date on which such replacement becomes
effective shall end on such date.
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"Investment" of a Person shall mean any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business), extension of credit (other than accounts
receivable and/or accrued expenses arising in the ordinary course of business
payable in accordance with customary practices and loans to employees in the
ordinary course of business) or contribution of capital by such Person; stocks,
bonds, mutual funds, partnership interests, notes, debentures or other
securities owned by such Person; any deposit accounts and certificates of
deposit owned by such Person; and structured notes, derivative financial
instruments and other similar instruments or contracts owned by such Person.
"Joinder Agreement" shall mean any joinder agreement entered into by a
Borrowing Subsidiary subsequent to the date hereof, which shall be in form and
substance satisfactory to the Agent.
"Lender Indebtedness" shall mean (a) the Advances and all other
indebtedness, obligations and liabilities of each Borrower and of each Guarantor
to the Agent or the Lenders under any Loan Document, and (b) all indebtedness,
obligations and liabilities of each Borrower and of each of their respective
Subsidiaries to any Lender in respect of any Swaps.
"Letter of Credit" shall mean a standby letter of credit having a stated
expiry date or a date upon which the draft must be reimbursed not later than
twelve months after the date of issuance and not later than the fifth Business
Day before the Termination Date, issued by the Agent on behalf of the Lenders
for the account of a Borrower pursuant to Section 2.1(a) under an application
and related documentation acceptable to the Agent requiring, among other
things, reimbursement by the Company or such Subsidiary to the Agent in respect
of all drafts or other demand for payment honored thereunder in accordance with
Section 3.3 and all expenses paid or incurred by the Agent relative thereto.
Additionally, all outstanding letters of credit as of the Effective Date issued
by the Agent for the account of the Company shall for all purposes be deemed
"Letters of Credit" issued hereunder.
"Letter of Credit Advance" shall mean any issuance of a Letter of Credit
under Section 2.4 made pursuant to Section 2.1(a) in which each Lender acquires
a pro rata risk participation.
"Letter of Credit Documents" shall have the meaning ascribed thereto in
Section 3.3(b).
"Leverage Ratio" shall mean, at any time, the ratio of (a) Total Debt at
such time to (b) EBITDA, as calculated as of the four most recently completed
fiscal quarters of the Company, all as determined in accordance with Generally
Accepted Accounting Principles.
"LIBOR Business Day" shall mean a day which is both a Business Day and a
day on which dealings in Dollar and Eligible Currency deposits are carried out
in the London interbank market.
"Lien" shall mean any pledge, assignment, hypothecation, mortgage, security
interest deposit arrangement, conditional sale or title retaining contract,
sale and leaseback transaction, lessor's or lessee's interest under any capital
lease, subordination of any claim or right, or any other type of lien, charge
or encumbrance.
"Loan" shall mean any Revolving Credit Loan, the Term Loan and any
Swingline Loan. Any such Loan or portion thereof may also be denominated as a
Floating Rate Loan, Eurocurrency Loan or a Eurodollar Loan and such Floating
Rate Loans, Eurocurrency Loans and Eurodollar Loans are referred to herein as
"types" of Loans.
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"Loan Document" shall mean, collectively, this Agreement, the Notes, the
Letter of Credit Documents, the Security Documents and any other agreement,
instrument or document executed in connection with any of the foregoing at any
time.
"Management Investors" shall mean each of the officers, employees and
directors of the Company who own Voting Stock in the Company on the Effective
Date, in each case so long as such person shall remain an officer, employee or
director of the Company.
"MascoTech" shall mean MascoTech, Inc., a Delaware corporation.
"Material Adverse Effect" shall mean (i) a material adverse effect on the
financial condition, results of operations, properties, assets, business or
prospects of the Company and its Subsidiaries, taken as a whole, (ii) a
material adverse effect on the ability of the Company to perform its
obligations under the Loan Documents or (iii) a material adverse effect on the
rights and remedies of the Agent or the Lenders under any of the Loan
Documents.
"Material Plan" shall mean at any time a Plan or Plans having aggregate
Unfunded Liabilities in excess of $5,000,000.
"Maturity Date" shall mean the earlier to occur of (a) January 22, 2003 and
(b) the date the Term Loan is accelerated pursuant to Section 6.2.
"Multiemployer Plan" means at any time an employee pension benefit plan
within the meaning of Section 4001(a)(3) of ERISA to which any member of the
ERISA Group is then making or accruing an obligation to make contributions or
has within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.
"NBD" shall mean NBD Bank, a Michigan banking corporation, including any of
its branches and affiliates.
"Negotiated Rate" shall mean, as to each Swingline Loan, the rate agreed
to by the Borrower of such Swingline Loan and the Agent at the time of such
Swingline Loan. The Negotiated Rate may be a fixed or a floating rate, and more
than one Negotiated Rate may be in effect at any time.
"Net Cash Proceeds" shall mean, (a) in connection with any sale or other
disposition of any asset or any settlement by, or receipt of payment in respect
of, any property insurance claim or condemnation award, the cash proceeds
(including any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price adjustment
receivable or otherwise, but only as and when received) of such sale,
settlement or payment, net of reasonable and documented attorneys' fees,
accountants' fees, investment banking fees, amounts required to be applied to
the repayment of Indebtedness secured by a Lien expressly permitted hereunder
on any asset which is the subject of such sale, insurance claim or condemnation
award (other than any Lien in favor of the Agent for the benefit of the Agent
and the Lenders) and other customary fees actually incurred in connection
therewith and net of taxes paid or reasonably estimated to be payable as a
result thereof and (b) in connection with any issuance or sale of any equity
securities or debt securities or instruments or the incurrence of loans, the
cash proceeds received from such issuance or incurrence, net of investment
banking fees, reasonable and documented attorneys' fees, accountants' fees,
underwriting discounts and commissions and other reasonable and customary fees
and expenses actually incurred in connection therewith.
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"Net Income" shall mean, for any period, the net income (or loss) of the
Company and its Subsidiaries on a consolidated basis for such period taken
as a single accounting period, determined in accordance with Generally Accepted
Accounting Principles; provided that in determining Net Income there shall be
excluded, without duplication: (a) the income (or loss) of any Person (other
than a Subsidiary of the Company) in which any Person other than the Company or
any of its Subsidiaries has a joint interest or partnership interest or other
ownership interest, except to the extent of the amount of dividends or other
distributions actually paid to the Company or any of its Subsidiaries by such
Person during such period, (b) the income of any Person accrued prior to the
date it becomes a Subsidiary of the Company or is merged into or consolidated
with the Company or any of its Subsidiaries or that Person's assets are acquired
by the Company or any of its Subsidiaries, unless such income is calculated on a
pro forma basis acceptable to the Agent in accordance with Section 1.3, in which
case such income shall not be excluded from Net Income, (c) the net proceeds of
any insurance policy, (d) gains (or non cash losses) from the sale, exchange,
transfer or other disposition of property or assets not in the ordinary course
of business of the Company and its Subsidiaries, and related tax effects in
accordance with Generally Accepted Accounting Principles, (e) any other
extraordinary or non-recurring gains (or non cash losses) of the Company or its
Subsidiaries, and related tax effects in accordance with Generally Accepted
Accounting Principles, (f) any income (or non cash losses) of any Unrestricted
Subsidiary, whether or not distributed to the Company or any of its
Subsidiaries, and (g) the income of any Subsidiary of the Company to the extent
that the declaration or payment of dividends or similar distributions by that
Subsidiary of that income is not at the time permitted by operation of the terms
of its charter or of any agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to that Subsidiary.
"Net Worth" shall mean, as of any date, the amount of any capital stock,
paid in capital and similar equity accounts plus (or minus in the case of
a negative) the amount of any foreign currency translation adjustment account
shown as a capital account of the Company and its Subsidiaries, all on a
consolidated basis in accordance with Generally Accepted Accounting Principles.
"Note" shall mean any Revolving Credit Note, any Term Note or the Swingline
Note.
"Overdue Rate" shall mean (a) in respect of principal of Floating Rate
Loans, a rate per annum that is equal to the sum of two percent (2%) per annum
plus the Floating Rate, (b) in respect of principal of Fixed Rate Loans, a rate
per annum that is equal to the sum of two percent (2%) per annum plus the per
annum rate in effect thereon until the end of the then current Interest Period
for such Loan and, thereafter, a rate per annum that is equal to the sum of two
percent (2%) per annum plus the Floating Rate, and (c) in respect of other
amounts payable by any Borrower hereunder (other than interest), a per annum
rate that is equal to the sum of two percent (2%) per annum plus the Floating
Rate.
"PBGC" shall mean the Pension Benefit Guaranty Corporation and any entity
succeeding to any or all of its functions under ERISA.
"Permitted Business" is defined in Section 5.2(h).
"Permitted Currency" shall mean Dollars or any Eligible Currency.
"Permitted Holders" shall mean the CVC Investors, MascoTech, the Management
Investors and their respective Permitted Transferees; provided, however, that
any Management Investor and any CVC Investor and any Permitted Transferee of a
Management Investor or CVC Investor (other than CVC or Citicorp, N.A. or any
direct or indirect Subsidiary of CVC or Citicorp, N.A. or any other Person
controlled by CVC or Citicorp, N.A.) shall not be a "Permitted Holder" if such
Person is the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, of Voting Stock that represents at least
30% of the aggregate voting power of all classes of the Voting Stock of the
Company,
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voting together as a single class (without giving effect to the attribution of
beneficial ownership as a result of any stockholders' agreement as in effect
on the Effective Date, and any amendment to such agreement that does not
materially change the allocation of voting power provided in such agreement).
"Permitted Investors" shall mean (i) MascoTech and its Permitted
Transferees, (ii) the CVC Investors and (iii) the Management Investors and their
respective Permitted Transferees, provided that the Management Investors and
their Permitted Transferees do not in the aggregate beneficially own more than
30% of the aggregate voting power of the Voting Stock of the Company (without
giving effect to any attribution of beneficial ownership which may result from
the Stockholders' Agreement, and any amendment to such agreement that does not
materially change the allocation of voting power provided for in such
agreement).
"Permitted Liens" shall mean Liens permitted by Section 5.2(e) hereof.
"Permitted Transferee" shall mean (a) with respect to any CVC Investor
who is an employee, officer or director of CVC or any Wholly-Owned (other than
directors' qualifying shares) Subsidiary of CVC, any spouse or lineal descendent
(including by adoption) of such CVC Investor so long as such CVC Investor shall
be an employee, officer or director of CVC; (b) with respect to MascoTech, any
direct or indirect Subsidiary or any other Person controlled by MascoTech; and
(c) with respect to any Management Investor, any spouse or lineal descendent
(including by adoption) of such Management Investor so long as such Management
Investor shall be an employee, officer or director of the Company.
"Person" shall include an individual, a corporation, an association, a
partnership, a trust or estate, a joint stock company, an unincorporated
organization, a joint venture, a trade or business (whether or not
incorporated), a government (foreign or domestic) and any agency or political
subdivision thereof, or any other entity.
"Plan" shall mean at any time an employee pension benefit plan (other than
a Multiemployer Plan) which is covered by Title IV of ERISA or subject to
the minimum funding standards under Section 412 of the Code and either (i) is
maintained, or contributed to, by any member of the ERISA Group for employees of
any member of the ERISA Group or (ii) has at any time within the preceding five
years been maintained, or contributed to, by any Person which was at such time a
member of the ERISA Group for employees of any Person which was at such time a
member of the ERISA Group.
"Pledge Agreements" shall mean each Pledge Agreement entered into by the
Company or any of its Subsidiaries for the benefit of the Agent and the Lenders
pursuant to this Agreement substantially in the forms attached hereto as
Exhibits D-1 and D-2, as amended by the Consent and Amendment and as further
amended or modified from time to time.
"Pledged Subsidiaries" shall mean those Foreign Subsidiaries 65% of whose
Capital Stock has been pledged to the Agent pursuant to a Pledge
Agreement.
"Pounds Sterling" means the lawful money of the United Kingdom.
"Preferred Stock" as applied to the Capital Stock of any corporation, shall
mean Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of assets
upon any voluntary or involuntary liquidation or dissolution of such
corporation, over shares of Capital Stock of any other class of such
corporation.
"Prime Rate" shall mean the per annum rate announced or established by the
Agent from time to time as its "prime rate" (it being acknowledged that such
announced rate may not necessarily be the lowest
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rate charged by the Agent to any of its customers) or the corporate base rate of
interest announced or established by any Affiliate of the Agent or, when used in
connection with any Advance denominated in any Eligible Currency, "Prime Rate"
shall mean the correlative floating rate of interest customarily applicable to
similar extensions of credit to corporate borrowers denominated in such currency
in the country of issue, as determined by the Agent, which Prime Rate shall
change simultaneously with any change in such announced or established rates.
"Reimbursement Agreements" shall mean the Standby Letter of Credit
Applications and Reimbursement Agreements executed in connection with the
Letters of Credit, as amended or modified from time to time.
"Rental Charges" shall mean, for any period, the maximum amount of all
rents and other payments (exclusive of property taxes, property and liability
insurance premiums and maintenance costs) accrued by the Company or its
Subsidiaries during such period under any lease of real or personal property in
respect of which the Company or its Subsidiaries are obligated as a lessee or
user, other than any Capital Lease.
"Reportable Event" shall mean a reportable event as described in
Section 4043(b) of ERISA including without limitation those events as to which
the thirty (30) day notice period is waived under Part 2615 of the regulations
promulgated by the PBGC under ERISA.
"Required Lenders" shall mean Lenders holding not less than 60% of the
Commitments (or 60% of the Advances if the Commitments have been terminated);
provided that if one Lender holds 60% or more of the Commitments (or 60% or more
of the Advances if the Commitments have been terminated), unless such Lender
holds 100% thereof, Required Lenders shall mean such Lender and one other
Lender.
"Requirement of Law" shall mean as to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other governmental authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Revolving Credit Advance" shall mean any Revolving Credit Loan and any
Letter of Credit Advance.
"Revolving Credit Loan" shall mean any borrowing under Section 2.4
evidenced by the Revolving Credit Notes and made pursuant to Section 2.1(a).
"Revolving Credit Notes" shall mean the promissory notes of the
Borrowers evidencing the Revolving Credit Loans, in substantially the form
annexed hereto as Exhibit E, as amended or modified from time to time and
together with any promissory note or notes issued in exchange or replacement
therefor.
"Revolving Credit Commitment" shall mean the Commitment of each Lender
to make Revolving Credit Advances under Section 2.1(a).
"Security Agreements" shall mean each Security Agreement entered into
by the Company or any Guarantor for the benefit of the Agent and the Lenders
pursuant to this Agreement substantially in the forms attached hereto as Exhibit
F-1 and F-2, as amended by the Consent and Amendment and as further amended or
modified from time to time, and any other agreement executed by the Company or
any of its Subsidiaries granting a Lien for the benefit of the Agent and the
Lenders in form or substance satisfactory to the Agent, as amended or modified
from time to time.
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"Security Documents" shall mean the Pledge Agreements, the Security
Agreements, the Guaranties, the Reimbursement Agreements, the Consent and
Amendment and all other agreements and documents delivered pursuant to the
Existing Credit Agreement, this Agreement or otherwise entered into by any
Person to secure or guaranty the obligations of the Borrowers under this
Agreement.
"Senior Subordinated Debt Documents" shall mean the Senior Subordinated
Note Indenture, the Senior Subordinated Notes and all agreements and documents
executed in connection therewith at any time, including without limitation those
agreements and documents listed on Schedule 1.1(b) hereto.
"Senior Subordinated Notes " shall mean the 11-3/8% Senior Subordinated
Notes issued by the Company in the aggregate principal amount of $100,000,000
due 2008 issued pursuant to the Senior Subordinated Note Indenture and any other
securities issued pursuant to the Senior Subordinated Note Indenture at any
time.
"Senior Subordinated Note Indenture" shall mean the Senior Subordinated
Indenture between the Company, the subsidiary guarantors named therein and IBJ
Xxxxxxxx Bank & Trust Company, as trustee, dated as of January 15, 1998, as
amended or modified from time to time.
"Significant Subsidiary" shall mean any one or more Subsidiaries which, if
considered in the aggregate as a single Subsidiary would be a "significant
subsidiary" as defined in Rule 1-02 of Regulation S-X under the Exchange Act,
provided that no Domestic Subsidiary which is not by itself a Significant
Subsidiary shall be included in any Significant Subsidiary if all Domestic
Subsidiaries which are not by themselves Significant Subsidiaries or Guarantors
would not constitute a Significant Subsidiary and no Foreign Subsidiary which is
not by itself a Significant Subsidiary shall be included in any Significant
Subsidiary if all Foreign Subsidiaries which are not by themselves Significant
Subsidiaries or Pledged Subsidiaries would not constitute a Significant
Subsidiary.
"Subordinated Debt" shall mean, in the case of the Company, all
Indebtedness owing pursuant to the Senior Subordinated Notes and any extensions,
refinancings, renewals or refundings thereof and any increases in the amount
thereof up to $130,000,000 in aggregate principal amount and, for any Person,
any other Indebtedness of such Person which is fully subordinated to all Lender
Indebtedness by written agreements and documents in form and substance
satisfactory to the Agent and the Required Lenders and which is governed by
terms and provisions, including without limitation maturities, covenants,
defaults, rates and fees, acceptable to the Agent and the Required Lenders.
"Subordinated Debt Documents" shall mean the Senior Subordinated Debt
Documents and any other agreement or document evidencing or relating to any
Subordinated Debt, whether under the Senior Subordinated Notes or any other
Subordinated Debt.
"Subsidiary" of any Person shall mean any other Person (whether now
existing or hereafter organized or acquired) in which (other than directors'
qualifying shares required by law) at least a majority of the securities or
other ownership interests of each class having ordinary voting power or
analogous right (other than securities or other ownership interests which have
such power or right only by reason of the happening of a contingency), at the
time as of which any determination is being made, are owned, beneficially and of
record, by such Person or by one or more of the other Subsidiaries of such
Person or by any combination thereof. Notwithstanding anything herein to the
contrary, an Unrestricted Subsidiary shall not be considered a Subsidiary.
"Substantial Portion" shall mean, with respect to the property of the
Company and its Subsidiaries, property which (a) represents more than 10% of the
consolidated assets of the Company and its Subsidiaries
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as would be shown in the consolidated financial statements of the Company and
its Subsidiaries as at the beginning of the twelve-month period ending with the
month in which such determination is made, (b) is responsible for more than 10%
of the consolidated net sales or of the consolidated net income of the Company
and its Subsidiaries as reflected in the financial statements referred to in
clause (a) above, (c) represents more than 25% of the consolidated assets of the
Company and its Subsidiaries as would be shown in the consolidated financial
statements of the Company and its Subsidiaries as of the Effective Date or (d)
is responsible for more than 25% of the consolidated net sales or of the
consolidated net income of the Company and its Subsidiaries as reflected in the
financial statements referred to in clause (c) above.
"Swaps" shall mean any interest rate or currency swaps, rate caps or
similar transactions, provided that such transactions are entered into by the
Company or any of its Subsidiaries to protect against fluctuations in interest
rates on Indebtedness of the Company and its Subsidiaries or in exchange rates,
and not for speculative purposes.
"Swingline Loan" shall mean any loan under Section 2.4 evidenced by the
Swingline Note and made by the Agent to a Borrower pursuant to Section 2.1(b).
"Swingline Note" shall mean any promissory note of the Borrowers evidencing
the Swingline Loans in substantially the form of Exhibit G hereto, as amended
or modified from time to time and together with any promissory note or notes
issued in exchange or replacement therefor.
"Term Loan" shall mean the term loan under Section 2.4 evidenced by the
Term Notes and made pursuant to Section 2.1(c).
"Term Loan Commitment" shall mean the Commitment of each Lender to make the
Term Loan under section 2.1(c).
"Term Loan Date" shall mean the date upon which the proceeds of the Term
Loan are disbursed to Borrowers.
"Term Note" shall mean any promissory note of the Company evidencing the
Term Loan in substantially the form annexed hereto as Exhibit H hereto, as
amended or modified from time to time and together with any promissory note or
notes issued in exchange or replacement therefor.
"Termination Date" shall mean the earlier to occur of (a) January 22, 2003,
and (b) the date on which the Commitments shall be terminated pursuant to
Section 2.2 or 6.2.
"Total Debt" as of any date, shall mean all of the following for the
Company and its Subsidiaries on a consolidated basis and without duplication:
(i) all debt for borrowed money and similar monetary obligations evidenced by
bonds, notes, debentures, Capital Lease obligations or otherwise, including
without limitation obligations in respect of the deferred purchase price of
properties or assets, in each case whether direct or indirect; (ii) all
liabilities secured by any Lien existing on property owned or acquired subject
thereto, whether or not the liability secured thereby shall have been assumed;
(iii) all reimbursement obligations under outstanding letters of credit in
respect of drafts which (A) may be presented or (B) have been presented and have
not yet been paid and are not included in clause (i) above; and (iv) all
guarantees and other Contingent Liabilities relating to indebtedness,
obligations or liabilities of the type described in the foregoing clauses (i),
(ii) and (iii).
"Total Interest Expense" shall mean, for any period, total interest and
related expense (including, without limitation, that portion of any Capitalized
Lease obligation attributable to interest expense in conformity with Generally
Accepted Accounting Principles, amortization of debt discount, all capitalized
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interest, the interest portion of any deferred payment obligations, all
commissions, discounts and other fees and charges owed with respect to letter of
credit and bankers acceptance financing, the net costs and net payments under
any interest rate hedging, cap or similar agreement or arrangement, prepayment
charges, agency fees, administrative fees, facility fees and capitalized
transaction costs allocated to interest expense) paid, payable or accrued during
such period, without duplication for any other period, with respect to all
outstanding Indebtedness of the Company and its Subsidiaries, all as determined
for the Company and its Subsidiaries on a consolidated basis for such period in
accordance with Generally Accepted Accounting Principles;
"Unfunded Liabilities" shall mean, with respect to any Plan at any time,
the amount (if any) by which (i) the value of all benefit liabilities under
such Plan, determined on a plan termination basis using the assumptions
prescribed by the PBGC for purposes of Section 4044 of ERISA, exceeds (ii) the
fair market value of all Plan assets allocable to such liabilities under Title
IV of ERISA (excluding any accrued but unpaid contributions), all determined as
of the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the ERISA
Group to the PBGC or any other Person under Title IV of ERISA.
"Unmatured Event" shall mean any event or condition which with notice or
lapse of time or both would, unless cured or waived, become an Event of Default.
"Unrestricted Subsidiary" shall mean any Subsidiary designated by the
Company as an Unrestricted Subsidiary and approved by the Agent in its
discretion, provided that (a) neither the Company nor any Subsidiary of the
Company which is not an Unrestricted Subsidiary shall be liable, directly or
indirectly, for any of the indebtedness, obligations or other liabilities of any
such Unrestricted Subsidiary or for any Contingent Liabilities with respect to
any Unrestricted Subsidiary and (b) after giving effect to such designation, no
Event of Default or Unmatured Event exists or would be caused thereby, on a pro
forma basis acceptable to the Agent. Any Unrestricted Subsidiary may be
designated as a Subsidiary by the Company at any time provided that (i) such
designation is approved by the Agent and (ii) no Event of Default or Unmatured
Event exists or would be caused thereby, all on a pro forma basis acceptable to
the Agent.
"Voting Stock" of a Person shall mean all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof.
1.2. Other Definitions; Rules of Construction. As used herein, the terms
"Agent", "Lenders", "Company", "Borrowing Subsidiary", "Borrower", "Borrowers"
and "this Agreement" shall have the respective meanings ascribed thereto in the
introductory paragraph of this Agreement. Such terms, together with the other
terms defined in Section 1.1, shall include both the singular and the plural
forms thereof and shall be construed accordingly. Use of the terms "herein",
"hereof", and "hereunder" shall be deemed references to this Agreement in its
entirety and not to the Section or clause in which such term appears.
References to "Sections" and "subsections" shall be to Sections and
subsections, respectively, of this Agreement unless otherwise specifically
provided.
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1.3. Accounting Terms and Determinations.
(a) Except as otherwise expressly provided herein, all accounting
terms used herein shall be interpreted, and all financial statements and
certificates and reports as to financial matters required to be delivered to
the Lenders hereunder shall (unless otherwise disclosed to the Lenders in
writing at the time of delivery thereof in the manner described in subsection
(b) below) be prepared, in accordance with Generally Accepted Accounting
Principles provided that, if the Company notifies the Agent that it wishes to
amend any covenant in Article V to eliminate the effect of any change in
Generally Accepted Accounting Principles (or if the Agent notifies the Company
that the Required Lenders wish to amend Article V for such purpose), then the
Company's compliance with such covenants shall be determined on the basis of
Generally Accepted Accounting Principles in effect immediately before the
relevant change in Generally Accepted Accounting Principles became effective
until either such notice is withdrawn or such covenant or any such defined term
is amended in a manner satisfactory to the Company and the Required Lenders.
Except as otherwise expressly provided herein, all references to a time of day
shall be references to Detroit, Michigan time. Notwithstanding anything herein,
in any financial statements of the Company or in Generally Accepted Accounting
Principles to the contrary, for purposes of calculating and determining
compliance with the financial covenants in Sections 5.2(a), (b) and (c),
including defined terms used therein, (i) no Unrestricted Subsidiary shall be
consolidated with the Company and its other Subsidiaries and each Unrestricted
Subsidiary shall be treated as if it were an equity interest and all income,
(except to the extent received by the Company in cash), liabilities and assets
of each Unrestricted Subsidiary shall be excluded from all such calculations
and determinations thereunder and (ii) any Acquisitions made by the Company or
any of its Subsidiaries, including through mergers or consolidations and
including any related financing transactions, during the period for which such
financial covenants were calculated shall be deemed to have occurred on the
first day of the relevant period for which such financial covenants were
calculated on a pro forma basis acceptable to the Agent.
(b) The Company shall deliver to the Lenders at the same time as the
delivery of any annual or monthly financial statement under Section 5.1(d)
hereof (i) a description in reasonable detail of any material variation between
the application or other modification of accounting principles employed in the
preparation of such statement and the application or other modification of
accounting principles employed in the preparation of the immediately prior
annual or quarterly financial statements as to which no objection has been
made in accordance with the last sentence of subsection (a) above and (ii) if
requested by the Agent, reasonable estimates of the difference between such
statements arising as a consequence thereof.
(c) To enable the ready and consistent determination of compliance
with the covenants set forth in Section 5.2 hereof, the Company will not
change the last day of its fiscal year from the date set forth in Schedule 1.3
for each year set forth on such Schedule, or the last days of the first three
fiscal quarters in each of its fiscal years from the thirteenth, twenty-sixth
and thirty-ninth Sunday after the end of the immediately preceding fiscal year.
ARTICLE II
THE COMMITMENTS AND THE ADVANCES
2.1. Commitments of the Lenders.
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(a) Revolving Credit Advances. Each Lender agrees, for itself only,
subject to the terms and conditions of this Agreement, to make Revolving Credit
Loans to the Borrowers pursuant to Section 2.4 and to participate in Letter of
Credit Advances to the Borrowers pursuant to Section 3.3, from time to time from
and including the Effective Date to but excluding the Termination Date, not to
exceed in aggregate principal amount at any time outstanding the amount
determined pursuant to Section 2.1(d).
(b) Swingline Loans.
(i) Any Borrower may request the Agent to make, and the Agent
may, in its sole discretion, make Swingline Loans to such Borrower from time to
time on any Business Day during the period from the Effective Date until the
Termination Date in an aggregate principal amount not to exceed at any time the
lesser of (A) $25,000,000 or the Dollar Equivalent thereof in Eligible
Currencies (the "Swingline Facility") and (B) the aggregate amount of Revolving
Credit Advances that could be but is not borrowed as of such date. Except for
purposes of clause (B) of the immediately preceding sentence, each Lender's
Commitment shall be deemed utilized by an amount equal to such Lender's pro
rata share (based on such Lender's Commitment) of each Swingline Loan for
purposes of determining the amount of Revolving Credit Advances required to be
made by such Lender. Each Swingline Loan shall bear interest at the Negotiated
Rate and shall mature as agreed by the Agent and such Borrower, not to exceed
30 days after the date thereof. Within the limits of the Swingline Facility, so
long as the Agent, in its sole discretion, elects to make Swingline Loans, the
Borrowers may borrow and reborrow under this Section 2.1(b)(i).
(ii) The Agent may at any time in its sole and absolute
discretion require that any Swingline Loan be refunded by a Revolving Credit
Loan which is in the currency of such Swingline Loan from the Revolving
Lenders, and upon written notice thereof by the Agent to the Lenders and
such Borrower, such Borrower shall be deemed to have requested a Revolving
Credit Loan in an amount equal to the amount of such Swingline Loan, (which
requested Revolving Credit Loan, absent any specification by the Borrower,
shall be a Floating Rate if such Swingline Loan is in Dollars and shall be a
Eurocurrency Loan with an Interest Period of one month if such Swingline Loan
is denominated in an Eligible Currency), and such Floating Rate Borrowing shall
be made to refund such Swingline Loans. Each Lender shall be absolutely and
unconditionally obligated to fund its pro rata share (based on such Lender's
Commitment) of such Floating Rate Borrowing or, if applicable, purchase a
participating interest in the Swingline Loans pursuant to Section 2.1(b)(iii)
and such obligation shall not be affected by any circumstance, including,
without limitation, (A) any set-off, counterclaim, recoupment, defense or other
right which such Lender has or may have against the Agent or any Borrower or
any if its Subsidiaries or anyone else for any reason whatsoever; (B) the
occurrence or continuance of an Unmatured Event or an Event of Default, subject
to Section 2.1(b)(iii); (C) the occurrence of any Material Adverse Effect; (D)
any breach of this Agreement or any other agreement by any other Lender, any
Borrower or any Guarantor; or (E) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing (including without
limitation any Borrower's failure to satisfy any conditions contained in
Article II or any other provision of this Agreement).
(iii) If, due to any Event of Default pursuant to Section 6.1(h)
Loans as described in Section 2.1(b)(ii) may not be made by the Lenders, then
(A) the Borrowers agree that each Swingline Loan not paid pursuant to Section
2.1(b)(ii) shall bear interest, payable on demand by the Agent, at the Overdue
Rate, and (B) effective on the date each such Loan would otherwise have been
made, each Lender severally agrees that it shall unconditionally and
irrevocably, without regard to the occurrence of any Unmatured Event or Event of
Default or any other circumstances, in lieu of deemed disbursement of loans, to
the extent of such Lender's Commitment, purchase a participating interest in the
Swingline Loans by paying its participation percentage thereof. Each Lender will
immediately transfer to the Agent, in same day funds and in the currency in
which such Swingline Loan was made, the amount
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of its participation. After such payment to the Agent, each Lender shall share
on a pro rata basis in any interest which accrues thereon and in all repayments
thereof (calculated by reference to its Commitment). If and to the extent that
any Lender shall not have so made the amount of such participating interest
available to the Agent, such Lender and the Borrowers severally agree to pay to
the Agent forthwith on demand such amount together with interest thereon, for
each day from the date of demand by the Agent until the date such amount is paid
to the Agent, at (x) in the case of any Borrower, the interest rate specified
above and (y) in the case of such Lender, the Federal Funds Rate for the first
five days after the date of demand by the Agent and thereafter at the interest
rate specified above.
(c) Term Loan. Each Lender further agrees, for itself only, subject
to the terms and conditions of this Agreement, to make its pro rata share,
based on its Term Loan Commitment, of a single five-year term loan to the
Company in an amount not to exceed $30,000,000. Such Term Loan shall be made,
at Company's request in accordance with Section 2.4, in a single draw on or
within three Business Days after the Effective Date of this Agreement
(d) Limitation on Amount of Advances. Notwithstanding anything in this
Agreement to the contrary:
(i) upon the occurrence and during the continuation of a
Borrowing Base Condition, the Dollar Equivalent of the aggregate principal
amount of the Advances outstanding to the Borrowers shall not exceed the amount
of the Borrowing Base;
(ii) the Dollar Equivalent of the aggregate principal amount of
Letters of Credit outstanding at any time shall not exceed $20,000,000;
(iii) the Dollar Equivalent of the aggregate principal amount of
Advances outstanding at any time in currencies other than Dollars shall not
exceed the Dollar Equivalent of $50,000,000;
(iv) the aggregate amount of the Term Loan shall not exceed
$30,000,000, and the pro rata share of any Lender's share of the Term Loan
shall not exceed the amount of such Lender's Term Loan Commitment; and
(v) the aggregate amount of the Revolving Credit Advances shall
not exceed the aggregate amount of the Revolving Credit Commitments, and the pro
rata share of any Lender's share of the Revolving Credit Advances shall not
exceed the amount of such Lender's Revolving Credit Commitment.
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2.2. Termination and Reduction of Commitments.
(a) The Company shall have the right to terminate or reduce the
Revolving Credit Commitments at any time and from time to time, provided that
(i) the Company shall give not less than three Business Days' notice of such
termination or reduction to the Agent specifying the amount and effective date
thereof, (ii) each partial reduction of the Revolving Credit Commitment shall be
in a minimum amount of $5,000,000 and in an integral multiple of $500,000 and
shall reduce the Revolving Credit Commitments of all of the Lenders
proportionately in accordance with the respective Revolving Credit Commitment
amounts for each such Lender, (iii) no such termination or reduction shall be
permitted with respect to any portion of the Revolving Credit Commitments as to
which a request for a Revolving Credit Advance pursuant to Section 2.4 is then
pending, and (iv) the Revolving Credit Commitments may not be terminated if any
Revolving Credit Advances are then outstanding and may not be reduced below the
principal amount of Revolving Credit Advances then outstanding. The Revolving
Credit Commitments or any portion thereof terminated or reduced pursuant to this
Section 2.2 may not be reinstated.
(b) For purposes of this Agreement, a Letter of Credit Advance (i)
shall be deemed outstanding in an amount equal to the sum of the maximum amount
available to be drawn under the related Letter of Credit on or after the date of
determination and on or before the stated expiry date thereof plus the amount of
any draws under such Letter of Credit that have not been reimbursed as provided
in Section 3.3 and (ii) shall be deemed outstanding at all times on and before
such stated expiry date or such earlier date on which all amounts available to
be drawn under such Letter of Credit have been fully drawn, and thereafter until
all related reimbursement obligations have been paid pursuant to Section 3.3. As
provided in Section 3.3, upon each payment made by the Agent in respect of any
draft or other demand for payment under any Letter of Credit, the amount of any
Letter of Credit outstanding immediately prior to such payment shall be
automatically reduced by the amount of each Revolving Credit Loan deemed
advanced in respect of the related reimbursement obligation of the relevant
Borrower.
2.3. Fees
(a) The Company agrees to pay to the Agent for the account of the
Lenders a facility fee on the Revolving Credit Commitments, whether used or
unused, for each day during the period from the Effective Date to but excluding
the Termination Date, at a rate equal to the Applicable Margin for such day.
Accrued facility fees shall be payable quarterly in arrears on the first
Business Day of each fiscal quarter of the Company commencing on March 29, 1998
and on the Termination Date.
(b) Each Borrower agrees to pay to the Agent (i) with respect to each
Letter of Credit issued for its account, a fee for each day during the period
from and including the date of issuance of such Letter of Credit to and
including the stated expiry of such Letter of Credit computed at the Applicable
Margin for such day calculated on the maximum amount available to be drawn on
such day under such Letter of Credit, which fee shall be paid quarterly in
arrears on the first Business Day of each fiscal quarter of the Company, which
fees shall be for the pro rata benefit of the Lenders and (ii) in addition to
all other fees, with respect to each Letter of Credit issued for its account, a
fee computed at the rate of 0.15% per annum for each day during the period from
and including the date of issuance of such Letter of Credit to and including the
stated expiry of such Letter of Credit calculated on the face amount of each
Letter of Credit, which fee shall be paid quarterly in arrears on the first
Business Day of each fiscal quarter of the Company and shall be solely for the
account of the Agent. Each Borrower further agrees to pay to the Agent, on
demand, such other customary administrative fees, charges and expenses of the
Agent in respect of the issuance, negotiation, acceptance, amendment, transfer
and
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payment of such Letter of Credit or otherwise payable pursuant to the
application and related documentation under which such Letter of Credit is
issued.
(c) The Company agrees to pay to the Agent agency fees for its services
as Agent under this Agreement and for other services in such amounts as may from
time to time be agreed to in writing between the Company and the Agent.
2.4. Disbursement of Advances.
(a) Each Borrower shall give the Agent notice of its request for each
Advance in substantially the form of Exhibit I hereto not later than 11:00 a.m.
Detroit time (i) three LIBOR Business Days prior to the date such Advance is
requested to be made if such Advance is to be made as a Eurodollar Borrowing,
(ii) five Business Days prior to the date any Letter of Credit Advance is
requested to be made, (iii) five Business days prior to the date such Advance is
requested to be made if such Advance is to be made as a Eurocurrency Borrowing,
(iv) on the Business Day such Advance is requested to be made in the case of any
Swingline Loan denominated in Dollars or such other day prior to the date any
Swingline Loan denominated in any Eligible Currency is requested to be made as
agreed upon between the Agent and such Borrower, (iv) three Business Days prior
to the date the Term Loan is requested to be made, (v) on the Business Day prior
to the date such Advance is requested to be made in all other cases, which
notice shall specify whether a Eurodollar Borrowing, a Floating Rate Borrowing,
a Eurocurrency Borrowing, a Swingline Loan or a Letter of Credit Advance is
requested and, in the case of each requested Fixed Rate Borrowing, the Interest
Period to be initially applicable to such Borrowing and, in the case of each
Letter of Credit Advance, such information as may be necessary for the issuance
thereof by the Agent. The Agent shall promptly provide notice of such requested
Advance (other than Swingline Loans) to each Lender. Subject to the terms and
conditions of this Agreement, the proceeds of each such requested Advance (other
than a Letter of Credit Advance) shall be made available to such Borrower by
depositing the proceeds thereof, in immediately available funds, in an account
maintained and designated by such Borrower at the Applicable Lending
Installation of the Agent or as otherwise agreed to between the Agent and such
Borrower. Subject to the terms and conditions of this Agreement, the Agent
shall, on the date such Letter of Credit Advance is requested to be made, issue
the related Letter of Credit on behalf of the Lenders for the account of such
Borrower. Notwithstanding anything herein to the contrary, (a) the Agent may
decline to issue any requested Letter of Credit on the basis that the
beneficiary, the purpose of issuance or the terms or the conditions of drawing
are contrary to any policy of the Agent applicable to borrowers generally, (b)
Revolving Credit Loans denominated in any Permitted Currency other than Dollars
may only be made as Eurocurrency Loans and (c) the Term Loan may be denominated
only in Dollars.
(b) Each Lender, not later than 2:00 p.m. local time on the date any
Borrowing in the form of a Loan is required to be made, shall make its pro rata
share of such Borrowing available in immediately available funds in the currency
requested at the Applicable Lending Installation of the Agent for disbursement
to such Borrower. Unless the Agent shall have received notice from any Lender
prior to the date such Borrowing is requested to be made under this Section 2.4
that such Lender will not make available to the Agent such Lender's pro rata
portion of such Borrowing, the Agent may assume that such Lender has made such
portion available to the Agent on the date such Borrowing is requested to be
made in accordance with this Section 2.4. If and to the extent such Lender shall
not have so made such pro rata portion available to the Agent, the Agent may
(but shall not be obligated to) make such amount available to the Company, and
such Lender and such Borrower severally agree to pay to the Agent forthwith on
demand such amount together with interest thereon, for each day from the date
such amount is made available to such Borrower by the Agent until the date such
amount is repaid to the Agent, at a rate per annum equal to, in the case of such
Borrower the interest rate applicable to such Borrowing during such period and,
in the case of any Lender, at the Federal Funds Rate for the first five days and
at the interest
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rate applicable to such borrowing thereafter. If such Lender shall pay such
amount to the Agent together with interest, such amount so paid shall constitute
a Loan by such Lender as a part of such Borrowing for purposes of this
Agreement. The failure of any Lender to make its pro rata portion of any such
Borrowing available to the Agent shall not relieve any other Lender of its
obligations to make available its pro rata portion of such Borrowing on the date
such Borrowing is requested to be made, but no Lender shall be responsible for
failure of any other Lender to make such pro rata portion available to the Agent
on the date of any such Borrowing.
(c) All Revolving Credit Loans shall be evidenced by the Revolving
Credit Notes, the Term Loan shall be evidenced by the Term Notes, and the
Swingline Loans shall be evidenced by the Swingline Note and all such Loans
shall be due and payable and bear interest as provided in Article III. Each
Lender and the Agent is hereby authorized by each Borrower to record on the
schedule attached to the Notes, or in its books and records, the date, and
amount and type of each Loan and the duration of the related Interest Period (if
applicable), the amount of each payment or prepayment of principal thereon, and
the other information provided for on such schedule, which schedule or books and
records, as the case may be, shall constitute prima facie evidence of the
information so recorded, provided, however, that failure of any Lender or the
Agent to record, or any error in recording, any such information shall not
relieve any Borrower of its obligation to repay the outstanding principal amount
of the Loans, all accrued interest thereon and other amounts payable with
respect thereto in accordance with the terms of the Notes and this Agreement.
Subject to the terms and conditions of this Agreement, the Borrowers may borrow
Revolving Credit Advances under this Section 2.4 and under Section 3.3, prepay
Revolving Credit Advances pursuant to Section 3.1 and reborrow Revolving Credit
Advances under this Section 2.4.
(d) Nothing in this Agreement shall be construed to require or
authorize any Lender to issue any Letter of Credit, it being recognized that the
Agent has the sole obligation under this Agreement to issue Letters of Credit
for the risk of the Lenders. Upon issuance of a Letter of Credit by the Agent,
each Lender shall automatically acquire a pro rata risk participation interest
in such Letter of Credit Advance based on its respective Commitment. If the
Agent shall honor a draft or other demand for payment presented or made under
any Letter of Credit, the Agent shall provide notice thereof to each Lender on
the date such draft or demand is honored unless such Borrower or any of its
Subsidiaries shall have satisfied its reimbursement obligation under Section 3.3
by payment to the Agent on such date. Each Lender, on such date, shall make its
pro rata share of the amount paid by the Agent available in immediately
available funds at the principal office of the Agent for the account of the
Agent. If and to the extent such Lender shall not have made any required pro
rata portion available to the Agent, such Lender and the Borrowers,
unconditionally and irrevocably, severally agree to pay to the Agent forthwith
on demand such amount together with interest thereon, for each day from the date
such amount was paid by the Agent until such amount is so made available to the
Agent at a per annum rate equal to the interest rate applicable during such
period to the related Loan disbursed under Section 3.3 in respect of the
reimbursement obligation of the Borrowers and the portion of the Loan deemed to
have been made by such Defaulting Lender shall be deemed not to have been made.
If such Lender shall pay such amount to the Agent together with such interest,
if any, accrued, such amount so paid shall constitute a Revolving Credit Loan by
such Lender as part of the Revolving Credit Borrowing disbursed in respect of
the reimbursement obligation of the Borrowers under Section 3.3 for purposes of
this Agreement. The failure of any Lender to make its pro rata portion of any
such amount paid by the Agent available to the Agent shall not relieve any other
Lender of its obligation to make available its pro rata portion of such amount,
but no Lender shall be responsible for failure of any other Lender to make such
pro rata portion available to the Agent. Notwithstanding anything herein to the
contrary, it is acknowledged and agreed that Letters of Credit hereunder may be
issued for the account of any of the Subsidiaries of the Company, provided that
for all purposes of this Agreement and all other Loan Documents both the Company
and such Subsidiary shall be deemed the account party thereon and shall be
jointly and severally liable for all obligations in connection therewith and the
Company shall have obtained an agreement from such
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Subsidiary that such Subsidiary shall be bound all of the terms and provisions
of this Agreement with respect to Letters of Credit, such agreement to be in
form of substance satisfactory to the Agent.
2.5. Conditions for First Disbursement. The obligation of the Lenders to
make the first Advance hereunder is subject to receipt by the Agent of the
following documents and completion of the following matters, in form and
substance satisfactory to the Agent:
(a) Charter Documents. Certificates of recent date of the appropriate
authority or official of each Borrower's and each Guarantor's respective
jurisdiction of organization listing all charter documents of each Borrower or
each Guarantor, respectively, on file in that office and certifying as to the
good standing and corporate existence of each Borrower or each Guarantor,
respectively, together with copies of such charter documents of each Borrower or
each Guarantor certified as of a recent date by such authority or official and
certified as true and correct as of the Effective Date by a duly authorized
officer of each Borrower or each Guarantor, respectively;
(b) By-Laws and Corporate Authorizations. Copies of the by-laws of each
Borrower and each Guarantor together with all authorizing resolutions and
evidence of other corporate action taken by each Borrower and each Guarantor to
authorize the execution, delivery and performance by each Borrower and each
Guarantor of this Agreement, the Notes and the Security Documents to which each
Borrower or such Guarantor, respectively, is a party and the consummation by
such Borrower or such Guarantor, respectively, of the transactions contemplated
hereby, certified as true and correct as of the Effective Date by a duly
authorized officer of each Borrower or each Guarantor, respectively;
(c) Incumbency Certificate. Certificates of incumbency of each Borrower
and each Guarantor containing, and attesting to the genuineness of, the
signatures of those officers or members, as the case may be, authorized to act
on behalf of each Borrower or each Guarantor in connection with this Agreement,
the Notes and the Security Documents to which each Borrower and each Guarantor
is a party and the consummation by such Borrower or such Guarantor of the
transactions contemplated hereby, certified as true and correct as of the
Effective Date by a duly authorized officer of each Borrower and each Guarantor;
(d) Notes. The Notes duly executed on behalf of each Borrower for each
Lender;
(e) Security Documents. The Security Documents duly executed on behalf
of the Company and the Guarantors, as the case may be, granting to the Lenders
and the Agent the collateral and security intended to be provided pursuant to
Section 2.10, or a confirmation pursuant to the Consent and Amendment of the
existing Security Documents executed and delivered pursuant to the Existing
Credit Agreement, as determined by the Agent, together with:
(i) Recording, Filing, Etc. Delivery of financing statements and
original stock certificates and transfer powers and completion of such other
action (including payment of any applicable taxes or fees) in such jurisdictions
as the Agent may deem necessary or appropriate with respect to the Security
Documents, together with Uniform Commercial Code record searches in such offices
as the Lenders or the Agent may request;
(ii) Casualty and Other Insurance. Evidence that the casualty and
other insurance required pursuant to Section 5.1(c) and the Security Documents
is in full force and effect;
(f) Legal Opinions. The favorable written opinions of counsel for each
Borrower and each Guarantor, substantially in the forms of Exhibits J-1, J-2 and
J-3 attached hereto and as to such other matters as the Agent may reasonably
request;
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(g) Consents, Approvals, Etc. Copies of all governmental and
nongovernmental consents, approvals, authorizations, declarations, registrations
or filings, if any, required on the part of any Borrower or any Guarantor in
connection with the execution, delivery and performance of the Loan Documents or
the transactions contemplated hereby or as a condition to the legality, validity
or enforceability of, the Loan Documents, certified as true and correct and in
full force and effect as of the Effective Date by a duly authorized officer of
the Company, or if none are required, a certificate of such officer to that
effect;
(h) Subordinated Debt. Evidence satisfactory to the Agent that the
Company has incurred Subordinated Debt in an amount equal to or greater than
$100,000,000 in accordance with the Senior Subordinated Debt Documents, a copy
of all Senior Subordinated Debt Documents (other than the Senior Subordinated
Notes) shall have been delivered to the Agent, the Senior Subordinated Note
Indenture shall be in substantially the form delivered to the Agent on January
16, 1998, and any other Senior Subordinated Debt Documents shall be reasonably
satisfactory to the Agent, and all transactions contemplated pursuant to the
Senior Subordinated Debt Documents to be completed upon original issuance of the
Senior Subordinated Notes shall have been completed;
(i) Environmental Certificate. An Environmental Certificate duly
executed by the Borrowers and the Guarantors, or a confirmation thereof pursuant
to the Consent and Amendment;
(j) Payments. Evidence satisfactory to the Agent that all transfers of
funds and payments described on Schedule 4.22 are being accomplished
simultaneously with the first Advance hereunder, including without limitation
the payment in full of all indebtedness and other liabilities, and the
termination of all commitments to lend and all Liens relating thereto, as
described on Schedule 4.22;
(k) Due Diligence. The Agent shall have received and be satisfied with
a field asset examination of receivables, all environmental reports and
liabilities, all litigation searches, a review of all Contingent Liabilities,
all fixed asset appraisals and all other due diligence and investigation
required by the Agent;
(l) Certificates. The Agent shall have received, in form and substance
satisfactory to the Agent, a pro forma covenant compliance certificate, as of
the Effective Date and as of the end of the first four quarters after the
Effective Date; and
(m) Other Conditions. Such other documents and completion of such other
matters as the Agent or any Lender may reasonably request, including without
limitation copies of all final projections and financial statements.
2.6. Further Conditions for Disbursement. The obligation of the Lenders to
make any Advance (including the first Advance) is further subject to the
satisfaction of the following conditions precedent:
(a) The representations and warranties contained in Article IV hereof
and in the Security Documents shall be true and correct in all material respects
on and as of the date such Advance is made (both before and after such Advance
is made) as if such representations and warranties were made on and as of such
date;
(b) No Event of Default or Unmatured Event shall exist or shall have
occurred and be continuing on the date such Advance is made and the making of
such Advance shall not cause an Event of Default or Unmatured Event;
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(c) If a Borrowing Base Condition shall exist, the Agent shall have
received the Borrowing Base Certificate pursuant to Section 5.1(d)(v) as of the
close of business on the last day of the month preceding the date such Advance
is made;
(d) In addition to all other applicable conditions, in the case of any
Letter of Credit Advance, a Borrower shall have delivered to the Agent issuing
the related Letter of Credit an application for such Letter of Credit and other
related documentation requested by and acceptable to the Agent appropriately
completed and duly executed on behalf of such Borrower; and
(e) The Borrowers shall be deemed to have made a representation and
warranty to the Lenders at the time of the making of each Advance to the effects
set forth in clauses (a) and (b) of this Section 2.6. For purposes of this
Section 2.6, the representations and warranties contained in Section 4.6 hereof
shall be deemed made with respect to both the financial statements referred to
therein and the most recent financial statements delivered pursuant to Section
5.1(d)(ii) and (iii).
2.7. Subsequent Elections as to Borrowings. As to Revolving Credit Loans, a
Borrower may elect (a) to continue a Fixed Rate Borrowing, or a portion thereof,
as a Fixed Rate Borrowing or (b) may elect to convert a Eurodollar Rate
Borrowing, or a portion thereof, to a Floating Rate Borrowing and (c) elect to
convert a Floating Rate Borrowing, or a portion thereof, to a Eurodollar Rate
Borrowing, in each case by giving notice thereof to the Agent in substantially
the form of Exhibit K hereto not later than 10:00 a.m. Detroit time three LIBOR
Business Days prior to the date any such continuation of or conversion to a
Eurodollar Borrowing is to be effective, 10:00 a.m. local time five LIBOR
Business Days prior to the date any such continuation of or conversion to a
Eurocurrency Borrowing is to be effective and not later than 10:00 a.m. Detroit
time one Business Day prior to the date such continuation or conversion is to be
effective in all other cases, provided that an outstanding Eurodollar Borrowing
may only be converted on the last day of the then current Interest Period with
respect to such Borrowing, and provided, further, if a continuation of a
Borrowing as, or a conversion of a Borrowing to, a Eurodollar Borrowing is
requested, such notice shall also specify the Interest Period to be applicable
thereto upon such continuation or conversion and no Event of Default or
Unmatured Event shall have occurred and be continuing. The Agent shall promptly
provide notice of such election to the Lenders. If the Company shall not timely
deliver such a notice with respect to any outstanding Eurodollar Borrowing, the
Company shall be deemed to have elected to convert such Eurodollar Borrowing to
an Floating Rate Borrowing on the last day of the then current Interest Period
with respect to such Borrowing. If a Borrowing Subsidiary shall not timely
deliver such notice with respect to any outstanding Eurocurrency Borrowing, such
Borrower shall be deemed to have elected to convert such Eurocurrency Borrowing
to a Eurocurrency Borrowing with an Interest Period of one month on the last day
of the then current Interest Period with respect to such Borrowing.
2.8. Minimum Amounts; Limitation on Number of Borrowings. Except for (a)
Advances and conversions thereof which exhaust the entire remaining amount of
the Commitments and (b) payments required pursuant to Section 3.8, each
Borrowing and each continuation or conversion pursuant to Section 2.7 and each
prepayment thereof shall be in a minimum amount of, in the case of Fixed Rate
Borrowings, $2,000,000 and in integral multiples of $500,000, and in the case of
Floating Rate Borrowings, $500,000 and in integral multiples of $100,000. No
more than six Interest Periods shall be permitted to exist at any one time with
respect to all Revolving Credit Borrowings outstanding hereunder from time to
time.
2.9. Borrowing Base Adjustments. The Borrowers agree that if at any time any
trade account receivable of the Company or any Subsidiary fails to constitute
Eligible Accounts Receivable for any reason, the Agent may, at any time upon
written notice to the Company and notwithstanding any prior
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classification of eligibility, classify such asset as ineligible and exclude the
same from the computation of the Borrowing Base. Additionally, the Agent may
establish such reserves against the Eligible Accounts Receivables and Eligible
Unbilled Receivables from time to time as determined by the Agent (in a
commercially reasonable manner), in each case without in any way impairing the
rights of the Lenders and the Agent in and to the same under the Security
Agreements.
2.10. Security and Collateral. To secure the payment when due of the Lender
Indebtedness, the Company shall execute and deliver, or cause to be executed and
delivered, to the Lenders and the Agent Security Documents granting the
following:
(a) Security interests in all present and future accounts, inventory,
equipment, fixtures and all other personal property (excluding the following
(the following described assets in this parenthetical are defined as the
"Excluded Collateral") (i) motor vehicles, instruments and chattel paper with an
aggregate value for all of the foregoing less than $1,000,000, (ii) real
property leases and (iii) rights arising under any contracts or licenses (other
than, in each of the foregoing cases, any right to receive payment) as to which
a grant of a security interest would constitute a violation of a valid and
enforceable restriction in favor of a third party on such grant, unless and
until any required consents shall have been obtained, provided that the Company
shall notify the Agent of any such restriction and shall use all reasonable
efforts to obtain any required consent to the extent requested by the Agent;
(b) Pledges of 100% of the Capital Stock of all Significant
Subsidiaries which are Domestic Subsidiaries owned directly by the Company or
any Domestic Subsidiary and not later than 60 days after the Effective Date, 65%
of all Capital Stock of each Foreign Subsidiary which is a Significant
Subsidiary and is directly owned by the Company or by any Domestic Subsidiary;
(c) Guaranties of all Guarantors; and
(d) All other security and collateral described in the Security
Documents.
Upon request of the Agent, (i) the Company and the Guarantors shall execute and
deliver such agreements and documents reasonably requested by the Agent to grant
a first priority lien and security interest on all real property owned by the
Company and the Guarantors and (ii) each Borrowing Subsidiary shall execute and
deliver all agreements and documents reasonably requested by the Agent to grant
a first priority lien and security interest on all assets owned by such
Borrowing Subsidiary, to secure the indebtedness and other obligations of such
Borrowing Subsidiary owing pursuant to the Loan Documents.
ARTICLE III
PAYMENTS AND PREPAYMENTS OF ADVANCES
3.1. Principal Payments.
(a) Unless earlier payment is required under this Agreement, each
Borrower shall pay on the Termination Date the entire outstanding principal
amount of its Revolving Credit Loans outstanding.
(b) Unless earlier payment is required under this Agreement, the
Company shall pay on the Maturity Date the entire outstanding principal amount
of the Term Loan.
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(c) In addition to any other payment required hereunder, if the
Advances at any time exceed the amount allowed pursuant to Section 2.1(d), the
Borrowers shall prepay the Advances by an amount equal to or greater than such
excess. Any such payments required under this clause (c) shall be applied first
to Revolving Credit Advances until paid in full, and if any additional payments
are required under this clause (c) such payments shall be applied to the Term
Loan if an Event of Default has occurred and is continuing or, if no Event of
Default has occurred and is continuing, at the option of the Company, such
payment shall be applied to the Term Loan or deposited into a special cash
collateral account to be held by the Agent as collateral security for the
payment and performance of the Lender Indebtedness and to be released by the
Agent to the Borrower to the extent the amount therein is greater than the
amount by which the Advances exceed the amount allowed pursuant to Section
2.1(d).
(d) The Borrowers may at any time and from time to time prepay all or a
portion of the Loans, without premium or penalty, provided that (i) the
Borrowers may not prepay any portion of any Loan as to which an election of or a
conversion to a Fixed Rate Loan is pending pursuant to 2.7, (ii) the Borrowers
shall comply with all requirements of Section 3.11 in connection with any
payment of any Fixed Rate Loan and (iii) the Borrowers will provide three
Business Days' prior written notice of any prepayment of a Fixed Rate Loan and
shall provide one Business Day's prior written notice of any prepayment of a
Floating Rate Loan.
3.2. Interest Payments. Each Borrower shall pay interest to the Lenders on
the unpaid principal amount of each of its Loans, for the period commencing on
the date such Loan is made until such Loan is paid in full, on each Interest
Payment Date and at maturity (whether at stated maturity, by acceleration or
otherwise), and thereafter on demand, at the following rates per annum:
(a) During such periods that such Loan is an Floating Rate Loan, the
Floating Rate.
(b) During such periods that such Loan is a Eurodollar Loan, the
Eurodollar Rate applicable to such Loan for each related Interest Period.
(c) During such periods that such Loan is a Eurocurrency Loan, the
Eurocurrency Rate applicable to such Loan for such related Interest Period.
(d) With respect to Swingline Loans, at the Negotiated Rate.
Notwithstanding the foregoing paragraphs (a), (b), (c) and (d), each Borrower
shall pay interest on demand at the Overdue Rate on the outstanding principal
amount of any of its Loans and any other amount payable by it hereunder (other
than interest) which is not paid when due, whether at stated maturity, by
acceleration or otherwise.
3.3. Letter of Credit Reimbursement Payments. (a) (i) Each Borrower agrees
to pay to the Agent, not later than 1:00 p.m. local time on the date on which
the Agent shall honor a draft or other demand for payment presented or made
under a Letter of Credit issued for the account of such Borrower (or on the
Business Day after receipt by such Borrower from the Agent of the notice
referred to in the next sentence, if later), an amount equal to the amount paid
by the Agent in respect of such draft or other demand under such Letter of
Credit and all reasonable expenses paid or incurred by the Agent relative
thereto (the "Reimbursement Amount"). The Agent shall, on the date of each
demand for payment under any Letter of Credit issued by the Agent, give such
Borrower notice thereof and of the amount of such Borrower's reimbursement
obligation and liability for expenses relative thereto. In the case of the
Company, if the Company shall not have made such payment to the Agent on such
day, upon each such payment by the Agent, the Company shall be deemed to have
elected to satisfy its reimbursement
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obligation by an Floating Rate Borrowing in an amount equal to the amount so
paid by the Agent in respect of such draft or other demand under such Letter of
Credit, and the Agent shall be deemed to have disbursed to the Company, for the
account of the Lenders, the Floating Rate Loans comprising such Floating Rate
Borrowing, and each Lender shall make its share of each such Floating Rate
Borrowing available to the Agent in accordance with this Agreement. Such
Floating Rate Loans shall be deemed disbursed notwithstanding any failure to
satisfy any conditions for disbursement of any Loan and, to the extent of the
Floating Rate Loans so disbursed, the reimbursement obligation of the Company
with respect to such Letter of Credit under this subsection (a)(i) shall be
deemed satisfied.
(ii) If, for any reason (including without limitation as a result
of the occurrence of an Event of Default with respect to any Borrower pursuant
to Section 6.1(h)) Floating Rate Loans may not be made by the Lenders as
described in subsection (a)(i) of this Section 3.3 or in the case of any Letter
of Credit Advance made to any Borrowing Subsidiary, (A) each Borrower agrees
that each Reimbursement Amount not paid pursuant to the first sentence of
subsection (a)(i) of this Section 3.3 shall bear interest, payable on demand by
the Agent, at the interest rate then applicable to Floating Rate Loans in the
case of any Letters of Credit denominated in Dollars and at the correlative
floating rate of interest customarily applicable to similar transactions of
credit to corporate borrowers denominated in such currency in the country of
issue, as determined by the Agent, in the case of any Letter of Credit
denominated in any Eligible Currency, and (B) effective on the date each such
Floating Rate Loan would otherwise have been made with respect to any Letter of
Credit in the case of any Letter of Credit denominated in Dollars or, in the
case of any Letter of Credit denominated in any Eligible Currency, effective on
the date the Reimbursement Amount is due thereunder, each Lender severally
agrees that it shall unconditionally and irrevocably, without regard to the
occurrence of any Event of Default or Unmatured Event or any other event or
condition to the extent of such Lender's pro rata share (based on the percentage
of the aggregate Commitments of all Lenders then constituted by such Lender's
Commitment) purchase a participating interest in each Reimbursement Amount. Each
such Lender will immediately transfer to the Agent, in same day funds, the
amount of its participation. Each such Lender shall share on a pro rata basis in
any interest which accrues thereon and in all repayments thereof. If and to the
extent that any Lender shall not have so made the amount of such participating
interest available to the Agent, such Lender agrees to pay to the Agent
forthwith on demand such amount together with interest thereon, for each day
from the date of demand by the Agent until the date such amount is paid to the
Agent, at the Federal Funds Rate for the first five days after such demand and
at the Overdue Rate thereafter.
(iii) Each Lender shall be obligated, absolutely and
unconditionally, to make Floating Rate Loans pursuant to Section 3.3(a)(i) to
purchase and fund participation interests in Letters of Credit pursuant to
Section 2.4(d) and 3.3(a)(ii) and the obligation shall not be affected by any
circumstance whatsoever, including, without limitation, (i) any set off,
counterclaim, recoupment, defense or other right which such Lender or any
Borrower may have against the Agent, any Borrower or anyone else for any reason
whatsoever, (ii) the occurrence of any Event of Default or Unmatured Event (iii)
the occurrence of any Material Adverse Effect, (iv) any breach of this Agreement
by any Borrower, any of their respective Subsidiaries, the Agent, or any other
Lender, or (v) any other circumstance, happening or event whatsoever, whether or
not similar to any of the foregoing, including without limitation any
termination or other limitation on the Commitments or any failure to satisfy any
conditions precedent to any Advance contained herein or any other provision of
this Agreement.
(b) To the fullest extent permitted by law, the reimbursement
obligation of each Borrower under this Section 3.3 shall be absolute,
unconditional and irrevocable and shall remain in full force and effect until
all obligations of such Borrower to the Lenders hereunder shall have been
satisfied, and such obligations of such Borrower shall not be affected, modified
or impaired upon the happening of any event, including without limitation, any
of the following, whether or not with notice to, or the consent of, such
Borrower:
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(i) Any lack of validity or enforceability of any Letter of Credit
or any documentation relating to any Letter of Credit or to any transaction
related in any way to such Letter of Credit (the "Letter of Credit Documents");
(ii) Any amendment, modification, waiver, consent, or any
substitution, exchange or release of or failure to perfect any interest in
collateral or security, with respect to any of the Letter of Credit Documents;
(iii) The existence of any claim, setoff, defense or other right
which any Borrower may have at any time against any beneficiary or any
transferee of any Letter of Credit (or any Persons or entities for whom any such
beneficiary or any such transferee may be acting), the Agent or any Lender or
any other Person or entity, whether in connection with any of the Letter of
Credit Documents, the transactions contemplated herein or therein or any
unrelated transactions;
(iv) Any draft or other statement or 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;
(v) Payment by the Agent to the beneficiary under any Letter of
Credit against presentation of documents which do not comply with the terms of
the Letter of Credit, including failure of any documents to bear any reference
or adequate reference to such Letter of Credit;
(vi) Any failure, omission, delay or lack on the part of the Agent
or any Lender or any party to any of the Letter of Credit Documents to enforce,
assert or exercise any right, power or remedy conferred upon the Agent any
Lender or any such party under this Agreement or any of the Letter of Credit
Documents, or any other acts or omissions on the part of the Agent any Lender or
any such party; or
(vii) Any other event or circumstance that would, in the absence of
this clause, result in the release or discharge by operation of law or otherwise
of any Borrower from the performance or observance of any obligation, covenant
or agreement contained in this Section 3.3.
No setoff, counterclaim, reduction or diminution of any obligation or any
defense of any kind or nature which any Borrower has or may have against the
beneficiary of any Letter of Credit shall be available hereunder to any Borrower
against the Agent or any Lender. Nothing in this Section 3.3 shall limit the
liability, if any, of the Lenders to any Borrower pursuant to Section 3.3(c).
(c) Each Borrower hereby indemnifies and agrees to hold harmless the
Lenders, the Agent and their respective officers, directors, employees and
agents, harmless from and against any and all claims, damages, losses,
liabilities, costs or expenses of any kind or nature whatsoever which the
Lenders, the Agent or any such Person may incur or which may be claimed against
any of them by reason of or in connection with any Letter of Credit issued for
its account, and neither any Lender, the Agent nor any of their respective
officers, directors, employees or agents shall be liable or responsible for: (i)
the use which may be made of any Letter of Credit or for any acts or omissions
of any beneficiary in connection therewith; (ii) the validity, sufficiency or
genuineness of documents or of any endorsement thereon, even if such documents
should in fact prove to be in any or all respects invalid, insufficient,
fraudulent or forged; (iii) payment by the Agent to the beneficiary under any
Letter of
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Credit against presentation of documents which do not comply with the terms of
any Letter of Credit, including failure of any documents to bear any reference
or adequate reference to such Letter of Credit; (iv) any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit; or (v)
any other event or circumstance whatsoever arising in connection with any
Letter of Credit; provided, however, that no Borrower shall be required to
indemnify the Lenders, the Agent and such other Persons, and the Lenders shall
be severally liable to such Borrower to the extent, but only to the extent, of
any direct, as opposed to consequential or incidental, damages suffered such
Borrower which were caused by (A) the Agent's wrongful dishonor of any Letter
of Credit after the presentation to it by the beneficiary thereunder of a draft
or other demand for payment and other documentation strictly complying with the
terms and conditions of such Letter of Credit, or (B) the payment by the Agent
to the beneficiary under any Letter of Credit against presentation of documents
which do not comply with the terms of the Letter of Credit to the extent, but
only to the extent, that such payment constitutes gross negligence or wilful
misconduct of the Agent; provided that none of the Agent, any Lender or any
such Person shall have the right to be indemnified hereunder for its own gross
negligence or wilful misconduct as determined by a court of competent
jurisdiction. It is understood that in making any payment under a Letter of
Credit the Agent will rely on documents presented to it under such Letter of
Credit as to any and all matters set forth therein without further
investigation and regardless of any notice or information to the contrary, and
such reliance and payment against documents presented under a Letter of Credit
substantially complying with the terms thereof shall not be deemed gross
negligence or wilful misconduct of the Agent in connection with such payment.
It is further acknowledged and agreed that the Borrowers may have rights
against the beneficiary or others in connection with any Letter of Credit with
respect to which the Lenders or the Agent are alleged to be liable and it shall
be a precondition of the assertion of any liability of the Lenders or the Agent
under this Section that the Borrowers shall first have exhausted all remedies
in respect of the alleged loss against such beneficiary and any other parties
obligated or liable in connection with such Letter of Credit and any related
transactions.
(d) For purposes of this Agreement, the outstanding amount of any
Letter of Credit issued in any currency other than Dollars shall equal the
Dollar Equivalent thereof.
3.4. Payment Method.
(a) All payments to be made by any Borrower hereunder will be made in
Dollars or the Permitted Currency in which the related obligations were incurred
and in immediately available funds to the Agent for the account of the Lenders
at its Applicable Lending Installation not later than 1:00 p.m. local time on
the date on which such payment shall become due. Payments received after 1:00
p.m. local time shall be deemed to be payments made prior to 1:00 p.m. local
time on the next succeeding Business Day. Each Borrower hereby authorizes the
Agent to charge its account with the Agent in order to cause timely payment of
principal, interest and fees due under Section 2.3 (subject to sufficient funds
being available in such account for that purpose).
(b) At the time of making each such payment, the relevant Borrower
shall, subject to the other terms and conditions of this Agreement, specify to
the Agent that Advance or other obligation of such Borrower hereunder to which
such payment is to be applied. In the event that such Borrower fails to so
specify the relevant obligation or if an Event of Default shall have occurred
and be continuing, the Agent may apply such payments as it may determine.
(c) On the day such payments are deemed received, the Agent shall remit
to the Lenders their pro rata shares of such payments in immediately available
funds, (i) in the case of payments of principal and interest on any Borrowing,
determined with respect to each such Lender by the ratio which the outstanding
principal balance of its Loan included in such Borrowing bears to the
outstanding principal balance of the Loans of all the Lenders included in such
Borrowing and (ii) in the case of fees paid pursuant to Section 2.3 and other
amounts payable hereunder (other than the Agent's fees payable pursuant to
Section 2.3(c) and amounts payable to any Lender under Section 2.4, 3.9 or 3.11)
determined with respect to each such Lender by the ratio which the Commitment of
such Lender bears to the Commitments of all the Lenders.
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3.5. No Setoff or Deduction. All payments of principal and interest on the
Loans and other amounts payable by the Borrowers hereunder shall be made by the
Borrowers without setoff or counterclaim, and free and clear of, and without
deduction or withholding for, or on account of, any present or future taxes,
levies, imposts, duties, fees, assessments, or other charges of whatever nature,
imposed by any governmental authority, or by any department, agency or other
political subdivision or taxing authority. If any such taxes, levies, imposts,
duties, fees, assessments, or other charges are required to be withheld from any
amounts payable hereunder with respect to any Advance in any Eligible Currency,
the amounts so payable shall be increased to the extent necessary to yield to
the payee thereof the interest or any such other amounts payable hereunder at
the rates and in the amounts specified in this Agreement.
3.6. Payment on Non-Business Day; Payment Computations. Except as otherwise
provided in this Agreement to the contrary, whenever any installment of
principal of, or interest on, any Loan or any other amount due hereunder becomes
due and payable on a day which is not a Business Day, the maturity thereof shall
be extended to the next succeeding Business Day and, in the case of any
installment of principal, interest shall be payable thereon at the rate per
annum determined in accordance with this Agreement during such extension.
Computations of interest and other amounts due under this Agreement shall be
made on the basis of a year of 360 days for the actual number of days elapsed,
including the first day but excluding the last day of the relevant period,
provided that the computation of interest at the Floating Rate shall be made on
the basis of a year of 365 days for the actual number of days elapsed, including
the first day but excluding the last day of the relevant period.
3.7. Impossibility; Interest Rate Inadequate or Unfair. If before the
beginning of any Interest Period:
(a) deposits in the relevant Permitted Currency (in the applicable
amounts) are not being offered to the Agent in the relevant market for such
Interest Period, or
(b) the Required Lenders advise the Agent that the Eurodollar Base Rate
or Eurocurrency Base Rate, as the case may be, will not adequately and fairly
reflect the cost to such Lenders of maintaining, making or funding, for such
Interest Period, the Fixed Rate Loans to which such Interest Period applies,
the Agent shall forthwith give notice thereof to the Borrowers and the Lenders,
whereupon until the Agent notifies the Borrowers that the circumstances giving
rise to such suspension no longer exist, the obligations, if any, of the Lenders
to make such Fixed Rate Loans, as the case may be, shall be suspended. In the
case of Eurodollar Loans, unless the relevant Borrower notifies the Agent (i)
not later than 3:00 p.m. (Detroit time) on the Business Day before the beginning
of such Interest Period that such Borrower elects not to borrow on such date,
such Borrowing shall, subject to the provisions of Section 2.6, be an Floating
Rate Borrowing. Promptly after the Agent receives any such notice from a
Borrower under this Section 3.7, the Agent shall notify each Lender of the
contents thereof. Any such notice from any Borrower shall be irrevocable once
the Agent begins notifying any Lender of the contents thereof.
3.8. Illegality. If, after the date of this Agreement, the introduction of,
or any change in, any applicable law, rule or regulation or in the
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof or compliance by any Lender
(or its Applicable Lending Installation) with any request or directive (whether
or not having the force of law) of any such authority shall make it unlawful or
impossible for such Lender (or its Applicable Lending Installation) to honor its
binding legal obligations, if any, hereunder to make, maintain or fund any type
of Fixed Rate Loans, such Lender shall so notify the Agent, and the Agent shall
forthwith give notice
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thereof to the Borrowers, whereupon until such Lender notifies the Agent that
the circumstances giving rise to such suspension no longer exist, the
obligation, if any, of such Lender to make such type of Fixed Rate Loans shall
be suspended. Before any Lender gives any notice of unlawfulness or
impossibility to the Agent under this Section 3.8, such Lender shall designate a
different Applicable Lending Installation if such designation will avoid the
need for giving such notice and will not, in the judgment of such Lender, be
otherwise disadvantageous to such Lender. Upon receipt of such notice, the
applicable Borrowers shall prepay in full the then outstanding principal amount
of each affected Fixed Rate Loan of such Lender together with accrued interest
thereon (a) on the last day of the then current Interest Period applicable to
such Loan if such Lender may lawfully continue to maintain and fund such Loan to
such day, or (b) immediately if such Lender may not lawfully continue to fund
and maintain such Loan to such day.
3.9. Increased Cost; Yield Protection.
(a) If, after the date hereof, the introduction of, or any change in,
any applicable law, treaty, rule or regulation (whether domestic or foreign and
including, without limitation, the Federal Deposit Insurance Act, as amended,
and Regulation D of the Board of Governors of the Federal Reserve System) or in
the interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by any Lender (or its Applicable Lending
Installation) with any request or directive of any such authority, central
Lender or comparable agency (whether or not having the force of law),
(i) shall subject any Lender (or its Applicable Lending
Installation) to any tax, duty or other charge with respect to its obligation to
make any Loans, its Notes, any of its Loans or any of the Letters of Credit or
shall change the basis of taxation of payments to any Lender (or its Applicable
Lending Installation) of the principal of or interest on any of its Fixed Rate
Loans or in respect of its obligation, if any, to make any Loans or to
participate in the risk of Letters of Credit (except for changes in the rate of
tax on the overall net income of such Lender or its Applicable Lending
Installation imposed by the jurisdiction in which such Lender's principal
executive office or Applicable Lending Installation is located), or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors of the
Federal Reserve System, but excluding with respect to any Fixed Rate Loan any
reserve requirements to the extent included in clause (b) of the definition of
Eurodollar Base Rate or Eurocurrency Base Rate, as the case may be, when
calculating the Eurodollar Base Rate or Eurocurrency Base Rate, as the case may
be, with respect to such Fixed Rate Loan), special deposit or similar
requirement (including, without limitation, any deposit insurance assessment in
respect of deposits held outside the United States, against assets of, deposits
with or for the account of, or credit extended by, any Lender's Applicable
Lending Installation, or shall impose on any Lender (or its Applicable Lending
Installation or the relevant interbank market) any other condition affecting its
obligation, if any, to make Loans or to participate in the risk of Letters of
Credit or affecting its Loans or the Letters of Credit or affecting the
Borrowers' obligations under the Notes in respect of such Loans, and the result
of any of the foregoing is to increase the cost to such Lender (or its
Applicable Lending Installation) of making or maintaining its existing or future
Fixed Rate Loans or of participating in the risk of Letters of Credit, or to
reduce the amount of any sum received or receivable by such Lender (or its
Applicable Lending Installation) under this Agreement or under the Notes (in
respect of Fixed Rate Loans) or Letters of Credit by an amount deemed by such
Lender to be material, then such Lender may notify the Borrowers (with a copy of
any such notice to be provided to the Agent) of any such fact of which it has
knowledge and demand compensation therefor; provided that, if such Lender fails
to demand such compensation (or notify the Borrowers that it will or may demand
such compensation) promptly upon becoming aware of the facts entitling it to do
so or, if such Lender is contesting the cause of such
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increased cost or reduced sum received or receivable, promptly after the earlier
of (A) the final determination of such contest or (B) an officer of such Lender
who is responsible for the administration of the credit outstanding under this
Agreement from such Lender to the Borrowers becoming aware of such facts, such
Lender shall not be entitled to such compensation for the period before the date
on which it actually demands (or notifies the Borrowers that it will or may
demand) such compensation; provided, further, that if such Lender is contesting
the cause of such increased cost or reduced sum received or receivable, such
Lender shall not in any event be entitled to such compensation for any period
prior to twelve months before it notifies the Borrowers that such Lender may or
will demand such compensation. The Borrowers agree to pay to such Lender such
additional amount or amounts as will compensate such Lender for such increased
cost or reduction in connection with their respective Loans within 15 days after
demand by such Lender. A certificate of such Lender setting forth the basis for
determining such additional amount or amounts necessary to compensate such
Lender shall be conclusive in the absence of manifest error. Each such Lender
will designate a different Applicable Lending Installation if such designation
would avoid the need for, or reduce the amount of such compensation and would
not, in the judgment of such Lender, be otherwise disadvantageous to such
Lender. In the event that any Borrower is required to compensate any Lender for
any increased cost to such Lender pursuant to this Section 3.9(a), such Borrower
shall have the right, upon at least five Business Days' prior notice to such
Lender through the Agent, to prepay in full any outstanding Fixed Rate Loans
that are related to such increased cost of such Lender, together with accrued
interest thereon to the date of prepayment; provided that prepayment of such
Fixed Rate Loans shall not relieve such Borrower of its obligation to compensate
such Lender in accordance with this Section 3.9(a), the amount of which
compensation shall be due at the time of such prepayment, notwithstanding any
other provision of this Section 3.9(a). Concurrently with prepaying each such
Fixed Rate Loan of such Lender, such Borrower shall borrow a Loan at the
Floating Rate (or, if such Borrower shall so elect in its notice of prepayment,
a Fixed Rate Loan of another type) in an equal principal amount from such Lender
for an Interest Period coinciding with the remaining term of the Interest Period
applicable to such Fixed Rate Loan, and such Lender shall make such a Floating
Rate Loan (or Fixed Rate Loan of the other type), provided that there has been
no acceleration of the amount due under the Notes pursuant to Section 6.2. The
Borrowers shall pay compensation owing to any Lender(s) under this Section
3.9(a) notwithstanding any subsequent replacement of the Lender(s) making demand
for such compensation.
(b) In the event that any applicable law, treaty, rule or regulation
(whether domestic or foreign) now or hereafter in effect and whether or not
presently applicable to any Lender or Agent, or any interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof, or compliance by any Lender or Agent
with any guideline, request or directive of any such authority (whether or not
having the force of law), including any risk-based capital guidelines, affects
or would affect the amount of capital required or expected to be maintained by
such Lender or the Agent (or any corporation controlling such Lender or the
Agent) and such Lender or the Agent, as the case may be, determines that the
amount of such capital is increased by or based upon the existence of such
Lender's or Agent's obligations or Loans hereunder and such increase has the
effect of reducing the rate of return on such Lender's or Agent's (or such
controlling corporation's) capital as a consequence of such obligations or Loans
hereunder to a level below that which such Lender or the Agent (or such
controlling corporation) could have achieved but for such circumstances (taking
into consideration its policies with respect to capital adequacy) by an amount
deemed by such Lender or the Agent to be material, then such Lender or the Agent
may notify the Borrowers of any such fact of which it has knowledge and each
Borrower shall pay to such Lender or the Agent, as the case may be, from time to
time, upon request by such Lender (with a copy of such request to be provided to
the Agent) or the Agent, additional amounts sufficient to compensate such Lender
or Agent (or such controlling corporation) for any increase in the amount of
capital and reduced rate of return which such Lender or the Agent reasonably
determines to be allocable to the existence of such Lender's or Agent's
obligations or Loans to such Borrower hereunder; provided that, if such Lender
or the
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Agent fails to notify the Borrowers of any such fact promptly upon
becoming aware thereof or, if such Lender or the Agent is contesting the cause
of such increase in the amount of capital or reduced rate of return, promptly
after the earlier of (A) the final determination of such contest or (B) an
officer of such Lender who is responsible for the administration of the credit
outstanding under this Agreement from such Lender to the Borrowers becoming
aware of any such fact, such Lender or the Agent, as the case may be, shall not
be entitled to such compensation for the period before the date on which it
actually notifies the Borrowers of such fact; provided, further, that if such
Lender or the Agent is contesting the cause of such increase in the amount of
capital or reduced rate of return, such Lender or the Agent, as the case may be,
shall not in any event be entitled to such compensation for any period prior to
six months before it notifies the Borrowers that such Lender or the Agent, as
the case may be, may or will demand such compensation. A statement as to the
amount of such compensation, prepared in good faith and in reasonable detail by
such Lender or the Agent, as the case may be, and submitted by such Lender or
Agent to the Borrowers, shall be conclusive in the absence of manifest error in
computation. The Borrowers shall pay such compensation for the periods covered
by such notice notwithstanding any replacement of the Lender(s) making demand
for such compensation.
3.10. Substitute Loans. If (a) the obligation, if any, of any Lender to make
any type of Fixed Rate Loans has been suspended pursuant to Section 3.8 or (b)
any Lender has demanded compensation under Section 3.9(a) and the Borrowers
shall, by at least five Business Days' prior notice to such Lender through the
Agent, have elected that the provisions of this Section 3.10 shall apply to such
Lender, then, unless and until such Lender notifies the Borrowers that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:
(i) all Loans which would otherwise be made by such Lender as the
affected type of Fixed Rate Loans shall be made instead as Loans at the Floating
Rate, for an Interest Period coincident with the related Fixed Rate Borrowing,
and
(ii) after each of its affected Fixed Rate Loans has been repaid,
all payments of principal which would otherwise be applied to repay such Fixed
Rate Loans shall be applied to repay its substitute loans instead.
3.11. Funding Losses. If any Borrower makes any payment of principal with
respect to any Fixed Rate Loan on any other date than the last day of an
Interest Period applicable thereto (whether pursuant to Sections 3.1, 3.7, 3.8,
3.10, 6.2, or otherwise), or if the applicable Borrower fails to borrow any
Fixed Rate Loan after the related notice of Borrowing has been given to the
Agent, or if the applicable Borrower fails to make any payment of principal or
interest in respect of a Fixed Rate Loan when due, the applicable Borrower shall
reimburse each Lender on demand for any resulting loss or expense incurred by
such Lender, including without limitation any loss incurred in obtaining,
liquidating or employing deposits from third parties, whether or not such Lender
shall have funded or committed to fund such Loan but excluding loss of margin
for the period after such payment or failure. A statement as to the amount of
such loss or expense, prepared in good faith and in reasonable detail by such
Lender and submitted by such Lender to the applicable Borrower, shall be
conclusive and binding for all purposes absent manifest error in computation.
Calculation of all amounts payable to each Lender under this Section 3.11 shall
be made as though such Lender shall have actually funded or committed to fund
the relevant Fixed Rate Loan through the purchase of an underlying deposit in an
amount equal to the amount of such Loan and having a maturity comparable to the
related Interest Period; provided, however, that such Lender may fund any Fixed
Rate Loan in any manner it sees fit and the foregoing assumption shall be
utilized only for the purpose of calculation of amounts payable under this
Section 3.11
3.12. Substitution of Lender. If (i) the obligation of any Lender to make or
maintain Eurodollar Loans has been suspended pursuant to Section 3.8 when not
all Lenders' obligations have
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been suspended (ii) any Lender has demanded compensation under Section 3.9 or
(iii) any Lender is a Defaulting Lender, the Company shall have the right, if no
Unmatured Event or Event of Default then exists, to replace such Lender (a
"Replaced Lender") with one or more other lenders (collectively, the
"Replacement Lender") acceptable to the Agent, provided that (x) at the time of
any replacement pursuant to this Section 3.12, the Replacement Lender shall
enter into one or more Assignment and Acceptances, pursuant to which the
Replacement Lender shall acquire the Commitments and outstanding Advances and
other obligations of the Replaced Lender and, in connection therewith, shall pay
to the Replaced Lender in respect thereof an amount equal to the sum of (A) the
amount of principal of, and all accrued interest on, all outstanding Loans of
the Replaced Lender, (B) the amount of all accrued, but theretofore unpaid, fees
owing to the Replaced Lender under Section 2.3 and (C) the amount which would be
payable by the Borrowers to the Replaced Lender pursuant to Section 3.9 or 3.11
if the Borrowers prepaid at the time of such replacement all of the Loans of
such Replaced Lender outstanding at such time and (y) all obligations of the
Borrowers then owing to the Replaced Lender (other than those specifically
described in clause (x) above in respect of which the assignment purchase price
has been, or is concurrently being, paid) shall be paid in full to such Replaced
Lender concurrently with such replacement. Upon the execution of the respective
Assignment and Acceptances, the payment of amounts referred to in clauses (x)
and (y) above and, if so requested by the Replacement Lender, delivery to the
Replacement Lender of the appropriate Note or Notes executed by the Borrowers,
the Replacement Lender shall become a Lender hereunder and the Replaced Lender
shall cease to constitute a Lender hereunder. The provisions of this Agreement
(including without limitation Sections 3.9, 3.11 and 9.5) shall continue to
govern the rights and obligations of a Replaced Lender with respect to any Loans
made or any other actions taken by such lender while it was a Lender. Nothing
herein shall release any Defaulting Lender from any obligation it may have to
the Borrowers, the Agent or any other Lender. Each Lender agrees to take such
actions, at the Company's expense, as may be reasonably necessary to effect the
foregoing if it shall become a Replaced Lender.
3.13. Applicable Lending Installation. Each Lender and the Agent may make
and books its Loans and, in the case of the Agent, issue Letters of Credit, at
any Applicable Lending Installation(s) selected by such Lender or the Agent, as
the case may be, and each Lender and the Agent may change its Applicable Lending
Installation(s) from time to time. Each Lender may, by written notice to the
Agent and the applicable Borrower, designate one or more Applicable Lending
Installations which are to make and book Loans and for whose account Loan
payments are to be made. The Agent may, by written notice to the applicable
Borrower, designate one or more Applicable Lending Installations which are to
make and book Swingline Loans and issue and book Letters of Credit and for whose
accounts Loan payments and Letter of Credit reimbursements are to be made and
through which its functions are to be performed. All terms of this Agreement
shall apply to any such Applicable Lending Installation(s) and the Notes shall
be deemed held by each Lender and the Agent, as the case may be, for the benefit
of such Applicable Lending Installation.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Each Borrower represents and warrants that:
4.1. Corporate Existence and Power. Each of the Borrowers and the
Guarantors is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of incorporation or organization,
and is duly qualified to do business, and is in good standing, in all
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additional jurisdictions where such qualification is necessary under applicable
law, except for those jurisdictions where the failure to so qualify or be in
good standing could not reasonably be expected to result in any Material Adverse
Effect. Each of the Borrowers and the Guarantors has all requisite corporate
power to own or lease the properties used in its business and to carry on its
business substantially as now being conducted and as proposed to be conducted,
and to execute and deliver the Loan Documents to which it is a party and to
engage in the transactions contemplated by the Loan Documents.
4.2. Corporate Authority. The execution, delivery and performance by each of
the Borrowers and the Guarantors of the Loan Documents to which it is a party
have been duly authorized by all necessary corporate action and are not in
contravention of any law, rule or regulation, or any judgment, decree, writ,
injunction, order or award of any arbitrator, court or governmental authority,
or of the terms of any Borrower's or any Guarantor's charter or by-laws, or of
any material contract or undertaking to which any Borrower or any Guarantor is a
party or by which any Borrower or any Guarantor or their respective material
property may be bound or affected or result in the imposition of any Lien except
for Permitted Liens.
4.3. Binding Effect. The Loan Documents to which any Borrower or any
Guarantor is a party are the legal, valid and binding obligations of the
Borrowers and the Guarantors, respectively, enforceable against each Borrower
and Guarantor in accordance with their respective terms, subject to the effect
of bankruptcy, insolvency, reorganization, moratorium and other similar laws
affecting the rights of creditors generally and by general principles of equity.
4.4. Subsidiaries. Schedule 4.4 hereto correctly sets forth the corporate
name, jurisdiction of organization and ownership of each Subsidiary of the
Company as of the date hereof. Each such Subsidiary and each Person becoming a
Subsidiary of the Company after the date hereof is and will be a corporation or
limited liability company duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization and is and
will be duly qualified to do business in each additional jurisdiction where such
qualification is or may be necessary under applicable law, except for those
jurisdictions where the failure to so qualify or be in good standing could not
reasonably be expected to result in any Material Adverse Effect. Each Subsidiary
of the Company has and will have all corporate or comparable requisite power to
own or lease the properties used in its business and to carry on its business
substantially as now being conducted and as proposed to be conducted, except
where the failure to have such power could not reasonably be expected to result
in a Material Adverse Effect. All outstanding shares (other than directors'
qualifying shares) of Capital Stock of each class of each Subsidiary of the
Company have been and will be validly issued and are and will be fully paid and
nonassessable and, except as otherwise indicated in Schedule 4.4 hereto, are and
will be owned, beneficially and of record, by the Company or another Subsidiary
of the Company free and clear of any Liens other than as permitted under this
Agreement.
4.5. Litigation. Except as set forth in Schedule 4.5 hereto, there is no
action, suit or proceeding pending or, to the best of the Company's knowledge,
threatened against or affecting the Company or any of its Subsidiaries before or
by any court, governmental authority or arbitrator, which if adversely decided
could reasonably be expected to result, either individually or collectively, in
any Material Adverse Effect and, to the best of the Company's knowledge, there
is no basis for any such action, suit or proceeding.
4.6. Financial Condition. The unaudited consolidated balance sheet of the
Company and its Subsidiaries and the unaudited consolidated statements of
operations and cash flows of the Company and its Subsidiaries for the nine
months ended September 28, 1997, copies of which have been furnished to the
Lenders, fairly present, and the financial statements of the Company and its
Subsidiaries delivered
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pursuant to Section 5.1(d) will fairly present, the consolidated financial
position of the Company and its Subsidiaries as at the respective dates thereof,
and the consolidated results of operations of the Company and its Subsidiaries
for the respective periods indicated, all in accordance with Generally Accepted
Accounting Principles (subject, in the case of said interim statements, to
year-end audit adjustments and the absence of footnotes). The budgeted
consolidated and consolidating financial statements of the Company and its
Subsidiaries and the pro forma projections of consolidated financial results of
the Company and its Subsidiaries for each of the fiscal years ending in 1997,
1998, 1999, 2000 and 2001 have been prepared in good faith and are based on
reasonable assumptions and, to the Company's knowledge, the best information
available as of the Effective Date. There has been no Material Adverse Effect
since September 28, 1997. There is no material Contingent Liability of the
Company or any of its Subsidiaries that is not reflected in such financial
statements or in the notes thereto and has not otherwise been described in
writing to the Agent.
4.7. Use of Advances. The Borrowers will use the proceeds of the initial
Advances hereunder as described in Section 4.21, and will use all other Advances
for general corporate purposes (including Acquisitions). Neither the Company nor
any of its Subsidiaries extends or maintains, in the ordinary course of
business, credit for the purpose, whether immediate, incidental, or ultimate, of
buying or carrying margin stock (within the meaning of Regulation G or U of the
Board of Governors of the Federal Reserve System), and no part of the proceeds
of any Advance will be used for the purpose, whether immediate, incidental, or
ultimate, of buying or carrying any such margin stock or maintaining or
extending credit to others for such purpose.
4.8. Consents, Etc. Except for such consents, approvals, authorizations,
declarations, registrations or filings delivered by the Company pursuant to
Section 2.5(g), if any, each of which is in full force and effect, no consent,
approval or authorization of or declaration, registration or filing with any
governmental authority or any nongovernmental Person or entity, including
without limitation any creditor, lessor or stockholder of the Company or any of
its Subsidiaries, is required on the part of the Company or any of its
Subsidiaries in connection with the execution, delivery and performance of any
Loan Document or the transactions contemplated hereby or as a condition to the
legality, validity or enforceability of any Loan Document.
4.9. Taxes. The Company and its Subsidiaries have filed all U.S. tax returns
(and all material foreign, state and local tax returns) required to be filed and
have paid all taxes shown thereon to be due and required to be paid including
interest and penalties, or have established adequate financial reserves on their
respective books and records for payment thereof. Neither the Company nor any of
its Subsidiaries knows of any material actual or proposed tax assessment or any
basis therefor, and no extension of time for the assessment of deficiencies in
any federal or state tax has been granted by the Company or any Subsidiary.
4.10. Title to Properties. Except as otherwise disclosed in the latest
balance sheet delivered pursuant to Section 4.6 or 5.1(d) of this Agreement, the
Company or one or more of its Subsidiaries have good and marketable fee simple
title to all of the real property reflected in said balance sheet, and a valid
and indefeasible ownership interest in all of the other material properties and
assets reflected in said balance sheet or subsequently acquired by the Company
or any Subsidiary. All of such properties and assets are free and clear of any
Lien except for Permitted Liens. The representations and warranties in the
Security Documents are true and correct in all material respects.
4.11. ERISA. Each member of the ERISA Group has fulfilled its obligations
under the minimum funding standards of ERISA and the Code with respect to each
Plan and is in compliance in all material respects with the presently applicable
provisions of ERISA and the Code with respect to each Plan. No member of the
ERISA Group has (i) sought a waiver of the minimum funding standard under
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Section 412 of the Code in respect of any Plan, (ii) failed to make any
contribution or payment to any Plan or Multiemployer Plan or in respect of any
Benefit Arrangement, or made any amendment to any Plan or Benefit Arrangement,
which has resulted or could result in the imposition of a Lien or the posting of
a bond or other security under ERISA or the Code or (iii) incurred any liability
under Title IV of ERISA other than a liability to the PBGC for premiums under
Section 4007 of ERISA.
4.12. Disclosure. As of the Effective Date, such reports and other
information furnished in writing or on behalf of the Company or any Subsidiary
to any Lender or the Agent in connection with the negotiation or administration
of this Agreement do not, taken as a whole, to the best of its knowledge contain
any material misstatement of fact or omit to state any material fact or any fact
necessary to make the statements contained therein not misleading.
Notwithstanding the foregoing, no representation is made as to any assumptions,
estimates, projections or opinions except that they are, to the Company's
knowledge, based on the best information available to the Company as of the date
of the relevant disclosure and are reasonable in light of such information. No
Loan Document nor any document or certificate furnished to any Lender or the
Agent by or on behalf of the Company or any Subsidiary in connection with the
transactions contemplated hereby contains any untrue statement of a material
fact or omits to state a material fact in order to make the statements contained
herein and therein not misleading. As of the Effective Date, there is no fact
known to the Company which has had or could reasonably be expected to have a
Material Adverse Effect, which has not been set forth in this Agreement or in
the other documents, certificates, statements, reports and other information
furnished in writing to the Agent by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated hereby taken as a
whole, including without limitation the offering memorandum for the Senior
Subordinated Notes.
4.13. Environmental and Safety Matters. All representations and warranties
made by the Borrowers and the Guarantors in the Environmental Certificate
delivered pursuant to Section 2.5(i) and Section 5.1(d)(x) are true and correct
in all material respects.
4.14. Borrowing Base. All trade accounts receivable and unbilled receivables
of the Company and each of its Subsidiaries represented or reported by the
Company to be, or are otherwise included in, Eligible Accounts Receivable or
Eligible Unbilled Receivables, as the case may be, comply in all respects with
the requirements therefor set forth in the definitions thereof, and the
computations of the Borrowing Base set forth in each Borrowing Base Certificate
are true and correct.
4.15. No Default. Neither the Company nor any Subsidiary is in default or
has received any written notice of default under or with respect to any of its
Contractual Obligations in any respect which is reasonably likely to result in a
Material Adverse Effect. No Unmatured Event or Event of Default has occurred and
is continuing.
4.16. Intellectual Property. The Company and each of its Subsidiaries owns,
or is licensed to use, all trademarks, tradenames, service marks, copyrights,
technology, know-how and processes necessary for the conduct of its business as
currently conducted (the "Intellectual Property") except for those the failure
to own or license which could not reasonably be expected to have a Material
Adverse Effect. No claim has been asserted and is pending by any Person
challenging or questioning the use of any such Intellectual Property or the
validity or effectiveness of any such Intellectual Property, nor does the
Company or any of its Subsidiaries know of any valid basis for any such claim,
the use of such Intellectual Property by the Company and each of its
Subsidiaries does not infringe on the rights of any Person, and, to the
knowledge of the Company, no Intellectual Property has been infringed,
misappropriated or diluted by any other Person except for such claims,
infringements, misappropriation and dilutions that, in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.
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4.17. Labor Matters. There are no strikes or other labor disputes against
the Company or any Subsidiary pending or, to the knowledge of the Company,
threatened that (individually or in the aggregate) could reasonably be expected
to have a Material Adverse Effect. Hours worked by and payment made to employees
of the Company and its Subsidiaries have not been in violation of the Fair Labor
Standards Act, if applicable, or any other applicable Requirement of Law dealing
with such matters that (individually or in the aggregate) could reasonably be
expected to have a Material Adverse Effect. All payments due from the Company
and each of its Subsidiaries on account of employee health and welfare insurance
that (individually or in the aggregate) could reasonably be expected to have a
Material Adverse Effect if not paid have been paid or accrued as a liability on
the books of the Company and its Subsidiaries.
4.18. Solvency
(a) After giving effect to the transactions described herein and to
the incurrence or assumption of any Indebtedness (including without limitation
the Subordinated Debt, all Advances and all other obligations being incurred or
assumed in connection herewith and therewith) (i) the fair value of the assets
of the Company and its Subsidiaries on a consolidated basis, at a fair
valuation, will exceed the debts and liabilities, subordinated, contingent or
otherwise, of the Company and its Subsidiaries on a consolidated basis; (ii) the
present fair saleable value of the property of the Company and its Subsidiaries
on a consolidated basis will be greater than the amount that will be required to
pay the probable liability of the Company and its Subsidiaries on a consolidated
basis on their debts and other liabilities, subordinated, contingent or
otherwise, as such debts and other liabilities become absolute and matured;
(iii) the Company and its Subsidiaries on a consolidated basis will be able to
pay their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (iv) the Company and its
Subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged as such
businesses are now conducted and are proposed to be conducted after the date
hereof.
(b) The Company does not intend to, or to permit any of its
Subsidiaries to, and does not believe that it or any of its Subsidiaries will,
incur debts beyond its ability to pay such debts as they mature, taking into
account the timing of and amounts of cash to be received by it or any such
Subsidiary and the timing of the amounts of cash to be payable on or in respect
of its Indebtedness or the Indebtedness of any such Subsidiary.
4.19. Not an Investment Company; Other Regulations. Neither the Company nor
any of its Subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended. Neither the Company nor any of its
Subsidiaries is subject to any regulation under any federal or state statute or
regulation (except those applicable to corporations generally) which limits its
ability to incur Indebtedness.
4.20. Senior Subordinated Debt Documents. All representations and warranties
of the Company contained in any Senior Subordinated Debt Document are true and
correct in all material respects. The Company has received net proceeds of not
less than $94,000,000 on January 22, 1998 from its issuance of the Senior
Subordinated Notes, and all agreements, instruments and documents executed or
delivered pursuant to the original issuance of the Senior Subordinated Notes are
described on Schedule 1.1(b) hereto. All Lender Indebtedness, including without
limitation all present and future Revolving Credit Advances and the Term Loan
and all other Lender Indebtedness, is "Senior Indebtedness" and "Designated
Senior Indebtedness" as defined in the Senior Subordinated Indenture and is and
will be incurred in compliance with the Senior Subordinated Indenture. This
Agreement and the other Loan Documents are the "Senior Credit Facility" as
defined in the Senior Subordinated Indenture. Other than the Lender
Indebtedness, there is no other "Designated Senior Indebtedness"
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thereunder. The Term Loan is being incurred pursuant to, and in full compliance
with, Section 4.3(a) of the Senior Subordinated Note Indenture, and the Term
Loan is classified as Indebtedness incurred under Section 4.3(a) of the Senior
Subordinated Note Indenture and is not classified as Indebtedness outstanding or
incurred pursuant to Section 4.3(b)(1) of the Senior Subordinated Note
Indenture. All Revolving Credit Advances, up to the full amount of the aggregate
Revolving Credit Commitments, are incurred pursuant to Section 4.3(b)(i) of the
Senior Subordinated Note Indenture and do not need to meet the requirements of
Section 4.3(a). There is no event of default or event or condition which would
become an event of default with notice or lapse of time or both, under the
Senior Subordinated Debt Documents and each of the Senior Subordinated Debt
Documents is in full force and effect. Other than pursuant to the Senior
Subordinated Debt Documents, there is no obligation pursuant to any Senior
Subordinated Debt Document or other document or agreement evidencing or relating
to any Subordinated Debt outstanding or to be outstanding on the Effective Date
which obligates the Company or any of its Subsidiaries to pay any principal or
interest or redeem any of its Capital Stock or incur any other monetary
obligation, and the Senior Subordinated Notes and any other promissory note or
other instrument evidencing any Subordinated Debt issued at any time pursuant to
the Senior Subordinated Debt Documents are and will be "Securities" as defined
in the Senior Subordinated Indenture.
4.21 Refinance Indebtedness. All indebtedness listed on Schedule 4.21
has been paid in full, and all commitments to lend and any agreements relating
to any such indebtedness are being terminated simultaneously herewith.
ARTICLE V
COVENANTS
5.1. Affirmative Covenants. Each Borrower covenants and agrees that, until
the Termination Date and thereafter until payment in full of the principal of
and accrued interest on the Notes and the performance of all other obligations
of each Borrower under this Agreement, unless the requisite Lenders pursuant to
Section 9.1 shall otherwise consent in writing, it shall, and, shall cause each
of its Subsidiaries to:
(a) Preservation of Corporate Existence, Etc. Do or cause to be done
all things necessary to preserve, renew and keep in full force and effect its
legal existence and its qualification as a foreign corporation or limited
liability company, as the case may be (other than any merger permitted pursuant
to Section 5.2(f) and other than any dissolution or liquidations of any
Subsidiary if the assets of such Subsidiary are transferred to the Company or
any Guarantor in connection with such dissolution or liquidation), in good
standing in each jurisdiction in which such qualification is necessary under
applicable law, except where the failure to be so qualified or in good standing
could not reasonably be expected to have a Material Adverse Effect and the
rights, licenses, permits (including those required under Environmental Laws),
franchises, patents, copyrights, trademarks and trade names material to the
conduct of its businesses; provided, however, that the Company shall not be
required to preserve any such right, license or franchise, or the corporate,
partnership or other existence of any of its Subsidiaries, if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company and its Subsidiaries, taken as a
whole, and that the loss thereof is not adverse in any material respect to the
Agent or the Lenders; and defend all of the foregoing against all claims,
actions, demands, suits or proceedings at law or in equity or by or before any
governmental instrumentality or other agency or regulatory authority except
where the failure to do so could not reasonably be expected to have a Material
Adverse Effect.
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(b) Compliance with Laws, Etc. Comply in all material respects with all
applicable laws, rules, regulations and orders of any governmental authority
whether federal, state, local or foreign (including without limitation ERISA,
the Code and Environmental Laws), in effect from time to time, the enforcement
of which could have a Material Adverse Effect; and pay and discharge, before any
interest or penalty for nonpayment thereof becomes payable, all taxes,
assessments and governmental charges or levies imposed upon it or upon its
income, revenues or property, before the same shall become delinquent or in
default, as well as all material lawful claims for labor, materials and supplies
or otherwise, which, if unpaid, might give rise to Liens (other than Permitted
Liens) upon such properties or any portion thereof, except to the extent that
payment of any of the foregoing is then being contested in good faith and with
respect to which adequate financial reserves have been established on the books
and records of the Company or such Subsidiary.
(c) Maintenance of Properties; Insurance. Maintain, preserve and
protect all property that is material to the conduct of the business of the
Company or any of its Subsidiaries and keep such property in good repair,
working order and condition and from time to time make, or cause to be made all
needful and proper repairs, renewals, additions, improvements and replacements
thereto necessary in order that the business carried on in connection therewith
may be properly conducted at all times in accordance with customary and prudent
business practices for similar businesses; and maintain in full force and effect
insurance with responsible and reputable insurance companies or associations in
such amounts, on such terms and covering such risks, including fire and other
risks insured against by extended coverage, as is usually carried by companies
engaged in similar businesses and owning similar properties similarly situated
and maintain in full force and effect public liability insurance, insurance
against claims for personal injury or death or property damage occurring in
connection with any of its activities or any of any properties owned, occupied
or controlled by it, in such amount as it shall reasonably deem necessary, and
maintain such other insurance as may be required by law or as may be reasonably
requested by the Required Lenders for purposes of assuring compliance with this
Section 5.1(c).
(d) Reporting Requirements. Furnish to the Lenders and the Agent the
following:
(i) Promptly and in any event within five Business Days after
becoming aware of the occurrence of (A) any Unmatured Event or Event of Default,
(B) the commencement of any litigation against, by or affecting the Company or
any of its Subsidiaries, which could reasonably be expected to have a Material
Adverse Effect, and any material developments therein, or (C) entering into any
material contract or undertaking that is not entered into in the ordinary course
of business or (D) any development in the business or affairs of the Company or
any of its Subsidiaries which has resulted in or which is likely in the
reasonable judgment of the Company, to result in a Material Adverse Effect, a
statement of the chief financial officer of the Company setting forth details of
such Unmatured Event, Event of Default, interest or undertaking, or development,
and the action which the Company or such Subsidiary, as the case may be, has
taken and proposes to take with respect thereto;
(ii) As soon as available and in any event within 50 days after the
end of each of the first three fiscal quarters of each fiscal year of the
Company, the consolidated and consolidating balance sheet of the Company and its
Subsidiaries and of its Unrestricted Subsidiaries as of the end of such quarter,
and the related consolidated and consolidating statements of income and cash
flows for such quarter and for the period commencing at the end of the previous
fiscal year and ending with the end of such quarter, setting forth in each case
in comparative form the corresponding figures for the corresponding date or
period of the preceding fiscal year and duly certified (subject to year-end
audit adjustments and the absence of footnotes) by the chief financial officer
of the Company as having been prepared in accordance with Generally Accepted
Accounting Principles, together with a certificate of the chief financial
officer of the Company stating (A) that no Unmatured Event or Event of Default,
has
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occurred and is continuing or, if an Unmatured Event or Event of Default has
occurred and is continuing, a statement setting forth the details thereof and
the action which the Company has taken and proposes to take with respect
thereto, and (B) that a computation (which computation shall accompany such
certificate and shall be in detail satisfactory to the Agent) showing compliance
(or non-compliance) with Section 5.2 (a), (b) and (c) hereof is in conformity
with the terms of this Agreement;
(iii) As soon as available and in any event within 95 days after
the end of each fiscal year of the Company, a copy of the consolidated balance
sheet of the Company and its Subsidiaries as of the end of such fiscal year and
the related consolidated statements of income and cash flows for such fiscal
year, with a customary audit report of Coopers & Xxxxxxx, or any of the six
largest independent certified public accounting firms in the United States,
without qualifications unacceptable to the Agent, together with, a certificate
of the chief financial officer of the Company stating (A) that no Unmatured
Event or Event of Default has occurred and is continuing or, if an Unmatured
Event or Event of Default has occurred and is continuing, a statement setting
forth the details thereof and the action which the Company has taken and
proposes to take with respect thereto, and (B) that a computation (which
computation shall accompany such certificate and shall be in reasonable detail)
showing compliance (or non-compliance) with Section 5.2 (a), (b), and (c) hereof
is in conformity with the terms of this Agreement;
(iv) Promptly after the sending or filing thereof, copies of all
reports, proxy statements and financial statements which the Company or any of
its Subsidiaries sends to or files with any of their respective security holders
as required by any securities exchange or the Securities and Exchange Commission
or any successor agency thereof;
(v) Within 20 days after the end of each month during which a
Borrowing Base Condition existed, a Borrowing Base Certificate prepared as of
the close of business on the last day of each month, certified as true and
correct by the chief financial officer of the Company, together with such
supporting schedules and information as reasonably requested by the Agent;
(vi) As soon as available and in any event within 20 days after the
end of each month, a report containing an aging as of the end of the preceding
month of accounts receivable and accounts payable of the Company, in a form
reasonably satisfactory to the Agent, if requested by the Agent;
(vii) Promptly and in any event within 10 Business Days after
receipt, a copy of any management letter or comparable analysis prepared by the
auditors for the Company or any of its Subsidiaries;
(viii) If and when any member of the ERISA Group (i) gives or is
required to give notice of PBGC of any Reportable Event with respect to any Plan
which might constitute grounds for a termination of such Plan under Title IV of
ERISA, or knows that the plan administrator of any Plan has given or is required
to give notice of any such Reportable Event, a copy of the notice of such
Reportable Event given or required to be given to the PBGC; (ii) receives notice
of complete or partial withdrawal liability under Title IV of ERISA or notice
that any Multiemployer Plan is in reorganization, is insolvent or has been
terminated, a copy of such notice; (iii) receives notice from the PBGC under
title IV of ERISA of an intent to terminate, impose liability (other than for
premiums under Section 4007 of ERISA) in respect of, or appoint a trustee to
administer any Plan, a copy of such notice; (iv) applies for a waiver of the
minimum funding standard under Section 412 of the Code, a copy of such
application; (v) gives notice of intent to terminate any Plan under Section
4041(c) of ERISA, a copy of such notice and other information filed with the
PBGC; (vi) gives notice of withdrawal from any Plan pursuant to Section 4063 of
ERISA, a copy of such notice; or (viii) fails to make any payment or
contribution to any Plan or
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Multiemployer Plan or in respect of any Benefit Arrangement or makes any
amendment to any Plan or Benefit Arrangement which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security, a
certificate of the chief financial officer or the chief accounting officer of
the Company setting forth details as to such occurrence and action, if any,
which the Company or applicable member of the ERISA Group is required or
proposes to take;
(ix) As soon as available and in event within 60 days after the
Effective Date, a complete detailed list of all Intellectual Property of the
Company and its Subsidiaries; and
(x) Promptly, such other information respecting the business,
properties, operations or condition, financial or otherwise, of the Company or
any of its Subsidiaries as the Agent may from time to time reasonably request.
(e) Accounting, Access to Records, Books, Etc. Maintain a system of
accounting established and administered in accordance with sound business
practices to permit preparation of financial statements in accordance with
Generally Accepted Accounting Principles and to comply with the requirements of
this Agreement and, at any reasonable time and from time to time, (i) at the
expense of such Lender or the Agent, permit any Lender or the Agent, or any
agents or representatives thereof, to examine and make copies of and abstracts
from the records and books of account of, and visit the properties of, the
Company and its Subsidiaries, and to discuss the affairs, finances and accounts
of the Company and its Subsidiaries with their respective directors, officers,
employees and independent auditors, and by this provision the Company does
hereby authorize such Persons to discuss such affairs, finances and accounts
with any Lender or the Agent, and (ii) at the expense of the Company, permit the
Agent or any of its agents or representatives to conduct a comprehensive field
audit of its books, records, properties and assets, including without limitation
all collateral subject to the Security Documents and site access, at the
Company's expense, provided that no Event of Default has occurred and is
continuing no more than two such comprehensive field audits may be performed in
any fiscal year of the Company at the expense of the Company, provided that the
Agent shall give the Company reasonable notice of any of the foregoing.
(f) Additional Security and Collateral. Promptly (i) execute and
deliver and cause each Guarantor to execute and deliver, additional Security
Documents, within 30 days after request therefor by the Agent, sufficient to
grant to the Agent for the benefit of the Lenders and the Agent liens and
security interests in any after acquired collateral of the type described in
Section 2.11, and (ii) cause each Person becoming a Significant Domestic
Subsidiary of the Company from time to time to execute and deliver to the
Lenders and the Agent, within 60 days after such Person becomes a Significant
Domestic Subsidiary, a Guaranty and a Security Agreement, together with other
related documents described in Section 2.5 sufficient to grant to the Agent for
the benefit of the Lenders and the Agent liens and security interests in all
collateral of the type described in Section 2.11. The Company shall notify the
Lenders and the Agent, within 10 days after the occurrence thereof, of the
acquisition of any material property by the Company or any Guarantor that is not
subject to the existing Security Documents, any Person becoming a Significant
Domestic Subsidiary and any other event or condition, other than the passage of
time, that may require additional action of any nature in order to preserve the
effectiveness and perfected status of the liens and security interests of the
Lenders and the Agent with respect to such property pursuant to the Security
Documents, including without limitation delivering the originals of all
promissory notes and other instruments payable to the Company or any Guarantors
to the Agent and delivering the originals of all stock certificates or other
certificates evidencing any Capital Stock owned by the Company or any Guarantors
at any time.
(g) Further Assurances. Execute and deliver, and cause its Subsidiaries
to execute and deliver, within 30 days after request therefor by the Agent, all
further instruments and documents and
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take all further action that the Agent may reasonably request, in order to give
effect to the intent of, and to aid in the exercise and enforcement of the
rights and remedies of the Lenders under, this Agreement, the Notes and the
Security Documents. In addition, the Company and each Guarantor agree to deliver
to the Agent from time to time upon the acquisition or creation of any
subsidiary not listed in Schedule 4.4 hereto supplements to Schedule 4.4 such
that such Schedule, together with such supplements, shall at all times
accurately reflect the information provided for thereon.
5.2. Negative Covenants. Until the Termination Date and thereafter until
payment in full of the principal of and accrued interest on the Notes and the
performance of all other obligations of the each Borrower under this Agreement,
each Borrower agrees that, unless the requisite Lenders pursuant to Section 9.1
shall otherwise consent in writing, it shall not, and shall not permit any of
its Subsidiaries, to:
(a) Net Worth. Permit or suffer the consolidated Net Worth of the
Company and its Subsidiaries to be less than the sum of (i) (A) $0 at any time
from and including the Effective Date to but excluding the last day of the 1998
fiscal year of the Company, (B) $4,000,000 at any time from and including the
last day of the 1998 fiscal year of the Company to but excluding the last day of
the 1999 fiscal year of the Company, or (C) $10,000,000 at any time thereafter,
(ii) 50% of the net income of the Company and its Subsidiaries, added as of the
end of each fiscal year of the Company, commencing with the 2000 fiscal year of
the Company, provided that if such net income is negative in any fiscal year the
amount added for such fiscal year shall be zero and shall not reduce the amount
added for any other fiscal year, and (iii) 100% of the Net Cash Proceeds
received by the Company from any sale or the transfer of any its Capital Stock.
(b) Leverage Ratio. Permit or suffer the Leverage Ratio to be greater
than (i) 5.0 to 1.0 at any time from and including the Effective Date to but
excluding the last day of the 1998 fiscal year of the Company, (ii) 4.5 to 1.0
at any time from and including the last day of the 1998 fiscal year of the
Company to but excluding the last day of the 1999 fiscal year of the Company,
(iii) 4.0 to 1.0 at any time from and including the last day of the 1999 fiscal
year of the Company to but excluding the last day of the 2000 fiscal year of the
Company, or (iv) 3.75 to 1.0 at any time thereafter.
(c) Fixed Charge Coverage Ratio. Permit or suffer the Fixed Charge
Coverage Ratio to be less than (i) 1.0 to 1.0 as of the end of any fiscal
quarter of the Company before the last day of the 1999 fiscal year of the
Company, (ii) 1.1 to 1.0 as of the end of any fiscal quarter of the Company
ending on or after the last day of the 1999 fiscal year of the Company but
before the last day of the 2000 fiscal year of the Company, (iii) 1.15 to 1.0 as
of the end of any fiscal quarter of the Company ending on or after the last day
of the 2000 fiscal year of the Company but before the last day of the 2001
fiscal year of the Company or (iv) 1.2 to 1.0 as of the end of any fiscal
quarter of the Company thereafter.
(d) Indebtedness. Create, incur, assume or in any manner become liable
in respect of, or suffer to exist, or permit or suffer any Subsidiary to create,
incur, assume or in any manner become liable in respect of, or suffer to exist,
any Indebtedness other than:
(i) The Lender Indebtedness;
(ii) The Indebtedness described in Schedule 5.2(d) hereto and
refinancings thereof, but no increase in the amount thereof (or in the case of a
committed facility or line of credit, in the amount of the commitments or credit
line), as such amount is reduced from time to time, provided that Indebtedness
under the Ford Facility (as defined in Schedule 5.2(d) may be increased to no
more than $10,000,000 (or the Dollar Equivalent thereof);
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(iii) Indebtedness of any Subsidiary of the Company owing to the
Company or to any other Subsidiary of the Company and Indebtedness of the
Company owing to any Subsidiary of the Company, provided that any such
Indebtedness of the Company owing to any Subsidiary of the Company is
subordinated, on terms acceptable to the Agent, to all Lender Indebtedness;
(iv) Subordinated Debt, including the related subordinated
guarantees, pursuant to the Senior Subordinated Debt Documents, provided that
the aggregate principal amount of such Subordinated Debt shall not exceed
$130,000,000, and other Subordinated Debt incurred in compliance with all terms
and provisions of this Agreement;
(v) Indebtedness of all Foreign Subsidiaries not otherwise
permitted by this Section 5.2(d) in an aggregate amount not to exceed
$10,000,000 at any time outstanding;
(vi) Trade accounts payable and accrued expenses arising in the
ordinary course which are past due in an amount which is not material in the
aggregate for the Company and its Subsidiaries on a consolidated basis or which
are being contested in good faith and for which adequate reserves are maintained
on the books of the Company;
(vii) Surety, customs or appeal bonds to which the Company or any
of its Subsidiaries is a party and letters of credit and reimbursement
agreements issued for the account of such Company or any Subsidiary in the
ordinary course of business which are not material in the aggregate and which
would not have a Material Adverse Effect and which are trade letters of credit
or which secure obligations in respect of (A) worker's compensation laws,
unemployment insurance laws or similar legislation, (B) obligations in
connection with bids, tenders, contracts or leases to which the Company or any
of its Subsidiaries is a party for a purpose other than borrowing money or
obtaining credit or (C) public or statutory obligations of the Company or any of
its Subsidiaries;
(viii) Indebtedness not otherwise permitted by this Section 5.2(d)
incurred or assumed for the purpose of financing all or any part of the cost of
acquiring any fixed asset (including through Capital Leases), in an aggregate
principal amount at any time outstanding not greater than $2,000,000;
(ix) Contingent Liabilities in respect of which the Company or a
Subsidiary is primary obligor otherwise permitted by Section 5.2(j); and
(x) Indebtedness of the Company or any Guarantor other than (i)
through (x) above not exceeding $10,000,000 in aggregate amount at any time
outstanding.
(e) Liens. Create, incur or suffer to exist any Lien on any of the
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether now owned or hereafter acquired, of the Company or any of
its Subsidiaries, other than:
(i) Liens for taxes not delinquent or for taxes being contested in
good faith by appropriate proceedings and as to which adequate financial
reserves have been established on its books and records;
(ii) Liens (other than any Lien imposed by ERISA) created and
maintained in the ordinary course of business which are not material in the
aggregate, and which would not have a Material Adverse Effect and which
constitute (A) pledges or deposits under worker's compensation laws,
unemployment insurance laws or similar legislation, (B) good faith deposits in
connection with bids, tenders, contracts or leases to which the Company or any
of its Subsidiaries is a party for a purpose other
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than borrowing money or obtaining credit, including rent security deposits, (C)
liens imposed by law, such as those of landlords, carriers, warehousemen and
mechanics, if payment of the obligation secured thereby is not yet due or which
are being contested in good faith by appropriate legal proceedings and with
respect to which adequate financial reserves have been established on the books
and records of Company or such Subsidiary, (D) liens securing taxes, assessments
or other governmental charges or levies not yet subject to penalties for
nonpayment, and (E) pledges or deposits to secure public or statutory
obligations of the Company or any of its Subsidiaries, or surety, customs or
appeal bonds to which the Company or any of its Subsidiaries is a party;
(iii) Liens affecting real property which constitute minor survey
exceptions or defects or irregularities in title, minor encumbrances, easements
or reservations of, or rights of others for, rights of way, sewers, electric
lines, telegraph and telephone lines and other similar purposes, or zoning or
other restrictions as to the use of such real property, provided that all of the
foregoing, in the aggregate, do not at any time materially detract from the
value of said properties or materially impair their use in the operation of the
businesses of the Company or any of its Subsidiaries;
(iv) Liens created pursuant to the Security Documents and Liens
expressly permitted by the Security Documents;
(v) Each Lien described in Schedule 5.2(e) hereto may be suffered
to exist, provided that there may be no increase in the amount of indebtedness,
obligations or liabilities secured thereby and it may not secure any other
indebtedness, obligations and liabilities other than those now secured;
(vi) Any Lien created to secure payment of a portion of the
purchase price of, or existing at the time of acquisition of, any tangible fixed
asset acquired by the Company or any of its Subsidiaries may be created or
suffered to exist upon such fixed asset if the outstanding principal amount of
the Indebtedness secured by such Lien does not at any time exceed the purchase
price paid by the Company or such Subsidiary for such fixed asset, provided that
(A) such Lien does not encumber any other asset at any time owned by the Company
or such Subsidiary, (B) not more than one such Lien shall encumber such fixed
asset at any one time and (C) the aggregate amount of Indebtedness secured by
all such Liens does not exceed the amount permitted by Section 5.2(d)(ix);
(vii) Any Lien on any assets of any Subsidiaries of the Company in
favor of the Company securing permitted Indebtedness of such Subsidiary owing to
the Company, provided that such Lien is subordinated to the Liens of the Agent
by written agreements satisfactory to the Agent; and
(viii) Any Lien created to secure Indebtedness of a Foreign
Subsidiary permitted pursuant to Section 5.2(d)(v) to the extent granting such a
Lien is customary for borrowers generally in the country in which such Foreign
Subsidiary is borrowing.
(f) Merger; Acquisitions; Etc. Purchase or otherwise acquire, or permit or
suffer any Subsidiary to purchase or otherwise acquire, whether in one or a
series of transactions, all or a substantial portion of the business assets,
rights, revenues or property, real, personal or mixed, tangible or intangible,
of any Person or make any other Acquisition, or all or a substantial portion of
the Capital Stock of or other ownership interest in any other Person; nor merge
or consolidate or amalgamate with any other Person or take any other action
having a similar effect, nor enter into any joint venture or similar arrangement
with any other Person, provided, however, that this Section 5.2(f) shall not
prohibit:
(i) any merger of any Subsidiary with or into another Subsidiary or any
merger of any Subsidiary into the Company, provided that (A) there is no
Unmatured Event or Event of
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Default either immediately before or immediately after such merger, (B) if any
such merger involves the Company, the Company shall be the surviving corporation
and (C) if any such merger involves the Company or any Guarantor, the
Consolidated Net Worth of the Company or such Guarantor involved in such merger
immediately after the merger would be equal to or greater than its Consolidated
Net Worth immediately preceding such merger, or
(ii) any other Acquisition if (A) immediately before and after (on
a pro forma basis acceptable to the Agent and supported by such certificates and
opinions required by the Agent) such Acquisition: (w) no Unmatured Event or
Event of Default shall exist or shall have occurred and be continuing, (x) the
representations and warranties contained in the Loan Documents shall be true and
correct as if made on the date such Acquisition is consummated, (y) the Company
is able to borrow at least $10,000,000 in Revolving Credit Loans after giving
effect to such acquisition and (z) the Leverage Ratio is at least 0.25 below the
level required under this Agreement, (B) prior to the consummation of such
acquisition, the Company shall have provided to the Lenders a certificate of the
chief financial officer of the Company (attaching pro forma financial statements
and computations to demonstrate compliance and projected compliance with all
covenants and conditions hereunder), stating that such Acquisition complies with
this Section 5.2(f), customary legal opinions reasonably acceptable to the Agent
if requested by the Agent, evidence that such Acquisition is in compliance with
all laws and regulations and that any other conditions under this Agreement
relating to such transaction have been satisfied, all in form and substance
reasonably satisfactory to the Agent, (C) the target of such acquisition is
engaged in a Permitted Business, (D) prior to the consummation of such
Acquisition, the Agent shall have completed such due diligence and reviewed such
agreements and documents with respect to such Acquisition as reasonably required
by the Agent, and the Agent shall be reasonably satisfied with such due
diligence and such review, (E) the board of directors or similar governing body
of the target of such Acquisition has recommended such Acquisition and (F) in
the case of all Acquisitions which do not involve the purchase of assets located
in the United States or Canada or the purchase of Capital Stock of any entity
which is not organized under the laws of the United States or Canada, the
aggregate purchase price paid (excluding any payment made in common stock (or
Preferred Stock which is not Disqualified Stock) of the Company) for all such
Acquisitions does not exceed $30,000,000; provided, however, that the
requirements contained in clauses (B) and (D) of this paragraph shall not be
required pursuant to any Acquisitions, which when aggregated with all other
Acquisitions in any fiscal year of the Company, do not involve an aggregate
purchase price paid for all such Acquisitions in any fiscal year in excess of
$15,000,000, or
(iii) the transactions described on Schedule 5.2(f).
(g) Disposition of Assets; Etc. Except for the transactions described
on Schedule 5.2(f), sell, lease, license, transfer, assign or otherwise dispose
of all or any material portion of its business, assets, rights, revenues or
property, real, personal or mixed, tangible or intangible, whether in one or a
series of transactions, other than inventory sold in the ordinary course of
business upon customary credit terms and sales of scrap or obsolete material or
equipment which are not material in the aggregate, and shall not permit or
suffer any Subsidiary to do any of the foregoing; provided, however, that this
Section 5.2(g) shall not prohibit (i) any such sale, lease, license, transfer,
assignment or other disposition if the aggregate book value (disregarding any
write-downs of such book value other than ordinary depreciation and
amortization) of all of the business, assets, rights, revenues and property
disposed of after the Effective Date of this Agreement shall not constitute a
Substantial Portion in the aggregate and if, immediately after such transaction,
no Unmatured Event or Event of Default shall exist or shall have occurred and be
continuing, (ii) sales of equipment and fixtures in the ordinary course of
business as to which proceeds are used within 180 days to purchase equipment or
fixtures of at least equivalent value to those sold, (iii) sales as to which
proceeds are used to make optional prepayments on the Revolving Credit Advances,
provided that such prepayments on the Revolving Credit Advances also
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permanently reduce the Commitments by the amount of such payments, (iv)
transfers of assets, including without limitation Capital Stock, between
Guarantors or between the Company and Guarantors or between Subsidiaries which
are not Guarantors or from a Subsidiary which is not a Guarantor to a Guarantor
or the Company, it being understood that for purposes of this clause (iv) a
Guarantor shall include any Subsidiary which becomes a Guarantor immediately
after such transfer, (v) any investment, loan or advance permitted by Section
5.2(j) or (vi) such transfer of assets as pursuant to a dividend or redemption
permitted by Section 5.2(i); provided, however, in the case of any of the
foregoing permitted sales, leases, licenses, transfers, assignments or other
dispositions (an "Asset Sale") the Company shall not, and shall not permit any
of its Subsidiaries to, consummate an Asset Sale unless (A) except for transfers
under clause (iv), (v) or (vi) above, the Company (or the Subsidiary, as the
case may be) receives consideration at the time of such Asset Sale at least
equal to the fair market value (evidenced by a resolution of the Board of
Directors set forth in an officer's certificate delivered to the Agent) of the
assets and (B) except for transfers under clause (iv), (v) or (vi) above, at
least 80% of the consideration therefor received by the Company or such
Subsidiary is in the form of cash; provided that the amount of (x) any
liabilities (as shown on the Company's or such Subsidiary's' most recent balance
sheet), of the Company or any Subsidiary that are assumed by the transferee of
any such assets such that the Company or such Subsidiary have no further
liability and (y) any securities, notes or other obligations received by the
Company or any such Subsidiary from such transferee that are converted by the
Company or such Subsidiary into cash (to the extent of the cash received), shall
be deemed to be cash for purposes of this provision and the definition of Net
Cash Proceeds, and the Agent promptly shall obtain a first priority security
interest in any non cash consideration for any Asset Sale by the Company or any
Guarantor to the extent such consideration consists of collateral described in
Section 2.11.
(h) Nature of Business. Engage in any line or lines of business
activity other than those engaged in on the Effective Date and those
substantially similar thereto (a "Permitted Business").
(i) Dividends and Other Restricted Payments. Make, pay, declare or
authorize any dividend, payment or other distribution in respect of any class of
its Capital Stock or any dividend, payment or distribution in connection with
the redemption, purchase, retirement or other acquisition, directly or
indirectly, of any shares of its Capital Stock other than such dividends,
payments or other distributions (i) to the extent payable solely in shares of
Capital Stock (other than Disqualified Stock) of the Company, (ii) the
repurchase, redemption or other acquisition or retirement for value of any
Capital Stock of the Company held by any employee of the Company upon
termination of employment of such employee, provided that the aggregate price
paid for such repurchased, redeemed, acquired or retired Capital Stock shall not
exceed $1,000,000 in any consecutive twelve month period, no Event of Default or
Unmatured Event shall have occurred and be continuing immediately after such
transaction and the price paid for such Capital Stock shall be made in
accordance with the existing agreements relating thereto, (iii) to the extent
permitted in Section 5.2(g)(iv) and (iv) dividends and distributions by
Subsidiaries of the Company. The Company will not issue any Disqualified Stock.
(j) Investments, Loans and Advances. Purchase or otherwise acquire any
Capital Stock of or other ownership interest in, or debt securities of or other
evidences of Indebtedness of, any other Person; nor make any loan or advance of
any of its funds or property or make any other extension of credit to, or make
any other investment or contribution or acquire any interest whatsoever in, any
other Person; nor incur any Contingent Liability except to the extent permitted
under Section 5.2(d) and other Contingent Liabilities in aggregate amount not to
exceed $500,000; nor permit any Subsidiary to do any of the foregoing; other
than (i) extensions of trade credit made in the ordinary course of business on
customary credit terms and commission, travel and similar advances made to
officers and employees in the ordinary course of business, (ii) Cash
Equivalents, (iii) Acquisitions permitted pursuant to Section 5.2(f), (iv)
investments, loans and advances in and to any Guarantor, any person becoming a
Guarantor as a result thereof, or the Company or otherwise pursuant to a
transaction permitted by Section 5.2(g)(iv),
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(v) investments, loans and advances after the Effective Date of this Agreement
in Unrestricted Subsidiaries in aggregate outstanding amount not exceeding
$5,000,000, (vi) investments, loans and advances after the Effective Date of
this Agreement in Foreign Subsidiaries in an aggregate outstanding amount not
exceeding $20,000,000, provided, however, that such investments, loans and
advances shall not be permitted unless immediately before and after (on a pro
forma basis acceptable to the Agent and supported by such certificates and
opinions as requested by the Agent) such investment, loan or advance: (w) the
terms and conditions thereof shall be reasonably satisfactory to the Agent, (x)
no Unmatured Event or Event of Default shall exist or shall have occurred and be
continuing, (y) the representations and warranties contained in the Loan
Documents shall be true and correct in all material respects on and as of the
date such investment, loan or advance is made as if made on the date thereof and
giving effect thereto and (z) the Company is able to borrow at least $10,000,000
in Revolving Credit Loans after giving effect to such investment, loan or
advance, (vii) extensions of credit to employees and officers of the Company and
its Subsidiaries in the ordinary course of business of the Company not in excess
of $1,500,000 in aggregate amount at any one time outstanding for all employees
and officers, (viii) those investments, loans, advances and other transactions
described in Schedule 5.2(j) hereto, having the same terms as existing on the
date of this Agreement, but no extension or renewal thereof shall be permitted,
(ix) payroll, travel and similar advances to cover matters that are expected at
the time of such advances ultimately to be treated as expenses for accounting
purposes and that are made in the ordinary course of business, (x) stock,
obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Subsidiary or in
satisfaction of judgments, (xi) guaranties of Lender Indebtedness, (xii) any
Advances of any of the Loans to any wholly owned Subsidiaries of the Company,
provided that any such Advance is evidenced by an enforceable demand promissory
note and the liabilities thereunder are not waived and (xiii) the transactions
described on Schedule 5.2(f).
(k) Transactions with Affiliates. Except for transactions described on
Schedule 5.2(f), enter into or permit to exist any transaction or series of
related transactions (including the purchase, sale lease or exchange of any
property, employee compensation arrangements or the rendering of any service)
with any Affiliate of the Company (an "Affiliate Transaction") unless the terms
thereof (1) are no less favorable to the Company or such Subsidiary than those
that could be obtained at the time of such transaction in arm's-length dealings
with a Person who is not such an Affiliate, (2) if such Affiliate Transaction
(or series of related Affiliate Transactions) involve aggregate payments in an
amount in excess of $1,000,000 (i) are set forth in writing and (ii) comply with
clause (1), (3) if such Affiliate Transaction (or series of related Affiliate
Transactions) involves aggregate payments in an amount in excess of $2,500,000
in any one year, (i) are set forth in writing, (ii) comply with clause (2) and
(iii) have been approved by a majority of the disinterested members of the Board
of Directors, and (4) if such Affiliate Transaction (or series of related
Affiliate Transactions) involves aggregate payments in an amount in excess of
$10,000,000 in any one year, (i) comply with clause (3) and (ii) have been
determined by a nationally recognized investment banking firm to be fair, from a
financial standpoint, to the Company and its Subsidiaries, provided that (A) (1)
any employment or consulting agreement or arrangement or indemnity agreement
entered into by the Company or any of its Subsidiaries in the ordinary course of
business and consistent with the past practice of the Company or such
Subsidiary, (2) transactions between or among the Company and/or the Guarantors
and (3) dividends, payments, distributions and redemptions pursuant to Section
5.2(i) shall not be subject to clause (4) above and (B) any loan, advance or
investment permitted by Section 5.2 (j) shall not be subject to clause (4) above
and (C) with respect to any transaction between the Company or a Guarantor and
any other Subsidiary, the amount by which the consideration paid by one party
would exceed the amount paid in an arms' length transaction, as determined by an
officer, the board of directors, or an accounting, appraisal or investment
banking firm, as the case may be, shall be treated as an investment for purposes
of Section 5.2(j), and such transaction shall only be permitted to the extent
such investment would be permitted by Section 5.2(j).
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(l) Inconsistent Agreements. Enter into any material agreement or
permit or suffer any Subsidiary to enter into any such agreement containing any
provision which would be violated or breached by this Agreement or any of the
transactions contemplated hereby or by performance by the Company or any of its
Subsidiaries of its obligations in connection therewith.
(m) Negative Pledge Limitation. Enter into any agreement (other than
the Senior Subordinated Note Indenture), including without limitation any
amendments to existing agreements, with any Person other than the Lenders
pursuant hereto which prohibits or limits the ability of the Company or any
Subsidiary to create, incur, assume or suffer to exist any Lien upon any of its
assets, rights, revenues or property, real, personal or mixed, tangible or
intangible, whether now owned or hereafter acquired, except for such
restrictions on a Foreign Subsidiary with respect to Indebtedness of a Foreign
Subsidiary permitted pursuant to Section 5.2(d)(v) and which restrictions are
customary in agreements of such type and would not be inconsistent with any of
the terms of this Agreement.
(n) Subsidiary Dividends. Permit any of its Subsidiaries directly or
indirectly to create or otherwise cause or suffer to exist or become effective
any consensual encumbrance or restriction which by its terms materially
restricts the ability of any such Subsidiary to (i) pay dividends or make any
other distributions on such Subsidiary's capital stock, (ii) pay any
Indebtedness owed to the Company or any of its other Subsidiaries, (iii) make
any loans or advances to the Company or any of such other Subsidiaries or (iv)
transfer any material portion of its assets to the Company or any of such other
Subsidiaries, except for (A) such encumbrances or restrictions required by
applicable law; (B) such encumbrances or restrictions consisting of customary
non-assignment provisions in leases governing leasehold interests to the extent
such provisions restrict the transfer of the lease or the property leased
thereunder and (C) such encumbrances or restrictions with respect to
Indebtedness of a Foreign Subsidiary permitted pursuant to Section 5.2(d)(v) and
which encumbrances or restrictions are customary in agreements of such type or
with respect to the Indebtedness owing to National Westminister Bank plc and
described on Schedule 5.2(d) and existing as of the Effective Date.
(o) Payments and Modification of Debt. Make, or permit any Subsidiary
to make, any optional payment, defeasance (whether a covenant defeasance, legal
defeasance or other defeasance), prepayment or redemption of any of its or any
of its Subsidiaries' Subordinated Debt or other Indebtedness or amend or modify,
or consent or agree to any amendment or modification of, any instrument or
agreement under which any of its Subordinated Debt is issued or created or
otherwise related thereto, or enter into any agreement or arrangement requiring
any defeasance of any kind of any of its Subordinated Debt, or designate any
Indebtedness (other than the Lender Indebtedness) as "Designated Senior
Indebtedness" under the Senior Subordinated Debt Documents, or issue any
security, instrument or other document evidencing any of the Subordinated Debt
outstanding pursuant to any of the Senior Subordinated Debt Documents which is
not a "Security" as defined in the Senior Subordinated Note Indenture.
(p) Financial Contracts. Incur or remain liable with respect to any
Financial Contracts except for purposes of hedging and not for speculative
purposes.
5.3. Additional Covenants. If at any time the Company shall enter into or be
a party to any instrument or agreement with respect to any Indebtedness which in
the aggregate, together with any related Indebtedness, exceeds $2,000,000,
including all such instruments or agreements in existence as of the date hereof
(other than the Senior Subordinated Debt Documents and the Lender Indebtedness)
and all such instruments or agreements entered into after the date hereof,
relating to or amending any terms or conditions applicable to any of such
Indebtedness which includes financial covenants or the equivalent thereof not
substantially provided for in this Agreement or more favorable to the lender or
lenders thereunder than those provided for in this Agreement, then the Company
shall promptly so advise the
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Agent and the Lenders. Thereupon, if the Agent shall request, upon notice to the
Company, the Agent and the Lenders shall enter into an amendment to this
Agreement or an additional agreement (as the Agent may request), providing for
substantially the same financial covenants or the equivalent thereof, as those
provided for in such instrument or agreement to the extent required and as may
be selected by the Agent. In addition to the foregoing, Sections 4.3, 4.5, 4.6,
4.7 and 4.8 of the Senior Subordinated Note Indenture, together with any related
definitions, are hereby incorporated by reference into this Agreement to the
same extent as if set forth fully herein, and no subsequent amendment, waiver,
termination or modification thereof shall effect any such covenants, terms,
conditions or defaults as incorporated herein.
ARTICLE VI
DEFAULT
6.1. Events of Default. The occurrence of any one of the following events or
conditions shall be deemed an "Event of Default" hereunder unless waived by the
requisite Lenders pursuant to Section 9.1:
(a) Nonpayment. Any Borrower shall fail to pay when due any principal
of the Notes, or any reimbursement obligation under Section 3.3 (whether by
deemed disbursement of a Revolving Credit Loan or otherwise), or, within 5 days
after becoming due, any interest on the Notes or any fees or any other amount
payable hereunder;
(b) Misrepresentation. Any representation or warranty made by the
Company or any Subsidiary in any Loan Document or any other certificate, report,
financial statement or other document furnished by or on behalf of the Company
or any Subsidiary in connection with this Agreement, shall prove to have been
incorrect in any material respect when made or deemed made;
(c) Certain Covenants. Any Borrower or any Guarantor shall fail to
perform or observe any term, covenant or agreement contained in Section 5.2
(other than clauses (k) and (l) thereof);
(d) Other Defaults. Any Borrower or any Guarantor shall fail to perform
or observe any other term, covenant or agreement contained in any Loan Document
(other than those described in Sections 6.1(a) or 6.1(c)), and any such failure
shall remain unremedied for 30 calendar days (or 5 calendar days in the case of
any failure to perform or observe the covenants contained in Section 5.1(d))
after written notice thereof shall have been given to the Borrowers by the Agent
(or such longer or shorter period of time as may be specified in such Loan
Document);
(e) Other Indebtedness. The Company or any of its Subsidiaries shall
fail to pay any part of the principal of, the premium, if any, or the interest
on, or any other payment of money due under any of its Indebtedness (other than
Indebtedness hereunder), beyond any period of grace provided with respect
thereto, which individually or together with other such Indebtedness as to which
any such failure exists has an aggregate outstanding principal amount in excess
of $5,000,000; or the Company or any of its Subsidiaries shall fail to perform
or observe any other term, covenant or agreement contained in any agreement,
document or instrument evidencing or securing any such Indebtedness having such
aggregate outstanding principal amount, or under which any such Indebtedness was
issued or created, beyond any period of grace, if any, provided with respect
thereto if the effect of such failure is either (i) to cause, or permit the
holders of such
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Indebtedness (or a trustee on behalf of such holders) to elect a majority of
the board of directors of the Company;
(f) Judgments. One or more judgments or orders for the payment of money
(not fully paid or covered without dispute by insurance) in an aggregate amount
of $5,000,000 in any fiscal year shall be rendered against the Company or any of
its Significant Subsidiaries, or any other judgment or order (whether or not for
the payment of money) shall be rendered against or shall affect the Company or
any of its Subsidiaries which causes or could reasonably be expected to cause or
could reasonably be expected to have a Material Adverse Effect, and either (i)
such judgment or order shall have remained unsatisfied and the Company or such
Significant Subsidiary shall not have taken action necessary to stay enforcement
thereof by reason of pending appeal or otherwise, prior to the expiration of the
applicable period of limitations for taking such action or, if such action shall
have been taken, a final order denying such stay shall have been rendered, or
(ii) enforcement proceedings shall have been commenced by any creditor upon any
such judgment or order;
(g) ERISA. Any member of the ERISA Group shall fail to pay when due an
amount or amounts aggregating in excess of $5,000,000 which it shall have become
liable to pay under Tile IV of ERISA; or notice of intent to terminate a
Material Plan shall be filed under title IV of ERISA any member of the ERISA
Group, any plan administrator or any combination of the foregoing; or PBGC shall
institute proceedings under title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment
obligation in excess of $5,000,000;
(h) Insolvency, Etc.. Any Borrower or any of their Significant
Subsidiaries shall be dissolved or liquidated or any judgment, order or decree
therefor shall be entered (other than dissolutions or liquidations of
Subsidiaries permitted by Section 5.1(a)), or shall generally not pay its debts
as they become due, or shall admit in writing its inability to pay its debts
generally, or shall make a general assignment for the benefit of creditors, or
shall institute, or there shall be instituted against any Borrower or any of
their respective Significant Subsidiaries, any proceeding or case seeking to
adjudicate it a bankrupt or insolvent or seeking liquidation, winding up,
reorganization, arrangement, adjustment, protection, relief or composition of it
or its debts under any law relating to bankruptcy, insolvency or reorganization
or relief or protection of debtors or seeking the entry of an order for relief,
or the appointment of a receiver, trustee, custodian or other similar official
for it or for any substantial part of its assets, rights, revenues or property,
and, if such proceeding is instituted against any Borrower or such Subsidiary
and is being contested by such Borrower or such Subsidiary, as the case may be,
in good faith by appropriate proceedings, such proceeding shall remain
undismissed or unstayed for a period of 60 days; or any Borrower or such
Subsidiary shall take any action (corporate or other) to authorize or further
any of the actions described above in this subsection;
(i) Other Documents. Any material provision of any Loan Document or any
Subordinated Debt Document shall at any time for any reason cease to be valid
and binding and enforceable against any obligor thereunder, or the validity,
binding effect or enforceability thereof shall be contested by any Person or any
obligor, shall deny that it has any or further liability or obligation
thereunder, or any Loan Document or any Subordinated Debt Document shall be
terminated, invalidated or set aside, or be declared ineffective or inoperative
or in any way cease to give or provide to the Lenders and the Agent the benefits
purported to be created thereby in any material manner; or
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(j) Control. Any Change of Control shall occur.
6.2. Remedies.
(a) Upon the occurrence and during the continuance of any Event of
Default, by notice to the Borrowers (i) the Agent may, and upon being directed
to do so by the Required Lenders shall, terminate the Commitments or (ii) the
Agent may, and upon being directed to do so by the Required Lenders, shall
declare the outstanding principal of, and accrued interest on, the Notes, all
unpaid reimbursement obligations in respect of drawings under Letters of Credit
and all other amounts owing under this Agreement to be immediately due and
payable, or (iii) the Agent may, and upon being directed to do so by the
Required Lenders, shall demand immediate delivery of cash collateral, and the
Borrowers agree to deliver such cash collateral upon demand, in an amount equal
to the maximum amount that may be available to be drawn at any time prior to the
stated expiry of all outstanding Letters of Credit, or any one or more of the
foregoing, whereupon the Commitments shall terminate forthwith and all such
amounts, including such cash collateral, shall become immediately due and
payable, as the case may be, provided that in the case of any event or condition
described in Section 6.1(h), the Commitments shall automatically terminate
forthwith and all such amounts, including such cash collateral, shall
automatically become immediately due and payable without notice; in all cases
without demand, presentment, protest, diligence, notice of dishonor or other
formality, all of which are hereby expressly waived. Such cash collateral
delivered in respect of outstanding Letters of Credit shall be deposited in a
special cash collateral account to be held by the Agent as collateral security
for the payment and performance of the Borrowers' obligations under this
Agreement to the Lenders and the Agent.
(b) The Agent may and, upon being directed to do so by the Required
Lenders, shall, in addition to the remedies provided in Section 6.2(a), exercise
and enforce any and all other rights and remedies available to it or the
Lenders, whether arising under this Agreement or any other Loan Document or
under applicable law, in any manner deemed appropriate by the Agent, including
suit in equity, action at law, or other appropriate proceedings, whether for the
specific performance (to the extent permitted by law) of any covenant or
agreement contained in any other Loan Document or in aid of the exercise of any
power granted in any other Loan Document.
(c) Upon the occurrence and during the continuance of any Event of
Default, each Lender may, subject to Section 7.10, at any time and from time to
time, without notice to the any Borrower (any requirement for such notice being
expressly waived by the Borrowers) set off and apply against any and all of the
obligations of the any Borrower now or hereafter existing under this Agreement,
whether owing to such Lender or any other Lender or the Agent, any and all
deposits (general or special, time or demand, provisional or final) at any time
held and other indebtedness at any time owing by such Lender or any Affiliate of
such Lender to or for the credit or the account of any Borrower and any property
of such Borrower from time to time in possession of such Lender or any Affiliate
of such Lender, irrespective of whether or not such Lender shall have made any
demand hereunder and although such obligations may be contingent and unmatured
Each Borrower hereby grants to the Lenders and the Agent a lien on and security
interest in all such deposits, indebtedness and property as collateral security
for the payment and performance of the obligations of such Borrower under this
Agreement. The rights of such Lender under this Section 6.2(c) are in addition
to other rights and remedies (including, without limitation, other rights of
setoff) which such Lender may have.
6.3. Distribution of Proceeds of Collateral. All proceeds of any realization
on the collateral pursuant to the Security Documents and any payments received
by the Agent or any Lender pursuant to the Guaranties subsequent to and during
the continuance of any Event of Default, shall be allocated and distributed by
the Agent as follows:
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(a) First, to the payment of all reasonable costs and expenses,
including without limitation all reasonable attorneys' fees, of the Agent in
connection with the enforcement of the Security Documents and otherwise
administering this Agreement;
(b) Second, to the payment of all fees required to be paid under any
Loan Document including facility fees, owing to the Lenders and Agent pursuant
to the Lender Indebtedness on a pro rata basis in accordance with the Lender
Indebtedness consisting of fees owing to the Lenders and Agent under the Lender
Indebtedness, for application to payment of such liabilities;
(c) Third, to the Lenders and Agent on a pro rata basis in accordance
with the Lender Indebtedness consisting of interest owing to the Lenders and
Agent under the Lender Indebtedness, for application to payment of such
liabilities;
(d) Fourth, to the Lenders and the Agent on a pro rata basis in
accordance with the Lender Indebtedness consisting of principal (including
without limitation any cash collateral for any outstanding letters of credit)
and obligations and liabilities relating to Swaps owing any Lender or the Agent,
for application to payment of such liabilities;
(e) Fifth, to the payment of any and all other amounts owing to the
Lenders and the Agent on a pro rata basis in accordance with the total amount of
such Indebtedness owing to each of the Lenders and the Agent, for application to
payment of such liabilities; and
(f) Sixth, to the Borrowers, or such other Person as may be legally
entitled thereto.
Notwithstanding the foregoing, no payments of principal, interest or fees
delivered to the Agent for the account of any Defaulting Lender shall be
delivered by the Agent to such Defaulting Lender. Instead, such payments shall,
for so long as such Defaulting Lender shall be a Defaulting Lender, be held by
the Agent, and the Agent is hereby authorized and directed by all parties hereto
to hold such funds in escrow and apply such funds as follows:
(i) First, if applicable to any payments due from such Defaulting
Lender to the Agent, and
(ii) Second, to Loans required to be made by such Defaulting Lender
on any borrowing date to the extent such Defaulting Lender fails to make such
Loans.
Notwithstanding the foregoing, upon the termination of all Commitments and the
payment and performance of all of the Advances and other obligations owing
hereunder (other than those owing to a Defaulting Lender), any funds then held
in escrow by the Agent pursuant to the preceding sentence shall be distributed
to each Defaulting Lender, pro rata in proportion to amounts that would be due
to each Defaulting Lender but for the fact that it is a Defaulting Lender.
6.4. Letter of Credit Liabilities. For the purposes of payments and
distributions under Section 6.3, the full amount of Lender Indebtedness on
account of any letter of credit then outstanding but not drawn upon shall be
deemed to be then due and owing. Amounts distributable to the Lenders or Agent
on account of such Lender Indebtedness under such letters of credit shall be
deposited in a separate collateral account in the name of and under the control
of the Agent and held by the Agent first as security for such letter of credit
Lender Indebtedness and then as security for all other Lender Indebtedness and
the amount so deposited shall be applied to the letter of credit Lender
Indebtedness at such times and to the extent that such letter of credit Lender
Indebtedness become absolute liabilities and
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if and to the extent that the letter of credit Lender Indebtedness fail to
become absolute Lender Indebtedness because of the expiration or termination of
the underlying letters of credit without being drawn upon then such amounts
shall be applied to the remaining Lender Indebtedness in the order provided in
Section 6.3. Each Borrower hereby grants to the Agent, for the benefit of the
Lenders and Agent, a lien and security interest in all such funds deposited in
such separate collateral account, as security for all the Lender Indebtedness of
such Borrower as set forth above.
ARTICLE VII
THE AGENT AND THE LENDERS
7.1. Appointment; Nature of Relationship. NBD is hereby appointed by the
Lenders as the Agent hereunder and under each other Loan Document, and each of
the Lenders irrevocably authorizes the Agent to act as the contractual
representative of such Lender with the rights and duties expressly set forth
herein and in the other Loan Documents. The Agent agrees to act as such
contractual representative upon the express conditions contained in this Article
VII. Notwithstanding the use of the defined term "Agent," it is expressly
understood and agreed that the Agent shall not have any fiduciary
responsibilities to any Lender by reason of this Agreement or any other Loan
Document and that the Agent is merely acting as the representative of the
Lenders with only those duties as are expressly set forth in this Agreement and
the other Loan Documents. In its capacity as the Lenders' contractual
representative, the Agent (i) does not hereby assume any fiduciary duties to any
of the Lenders, (ii) is a "representative" of the Lenders within the meaning of
Section 9-105 of the Uniform Commercial Code and (iii) is acting as an
independent contractor, the rights and duties of which are limited to those
expressly set forth in this Agreement and the other Loan Documents. Each of the
Lenders hereby agrees to assert no claim against the Agent on any agency theory
or any other theory of liability for breach of fiduciary duty, all of which
claims each Lender hereby waives.
7.2. Powers. The Agent shall have and may exercise such powers under the
Loan Documents as are specifically delegated to the Agent by the terms of each
thereof, together with such powers as are reasonably incidental thereto. The
Agent shall have no implied duties to the Lenders, or any obligation to the
Lenders to take any action thereunder except any action specifically provided by
the Loan Documents to be taken by the Agent.
7.3. General Immunity. Neither the Agent nor any of its directors, officers,
agents or employees shall be liable to the Company or any of its Subsidiaries,
the Lenders or any Lender for any action taken or omitted to be taken by it or
them hereunder or under any other Loan Document or in connection herewith or
therewith except for its or their own gross negligence or willful misconduct.
7.4. No Responsibility for Loans, Recitals, etc. Neither the Agent nor any
of its directors, officers, agents or employees shall be responsible for or have
any duty to ascertain, inquire into, or verify (i) any statement, warranty or
representation made in connection with any Loan Document or any borrowing
hereunder; (ii) the performance or observance of any of the covenants or
agreements of any obligor under any Loan Document, including, without
limitation, any agreement by an obligor to furnish information directly to each
Lender; (iii) the satisfaction of any condition specified in Article II, except
receipt of items required to be delivered to the Agent; (iv) the validity,
enforceability, effectiveness, sufficiency or genuineness of any Loan Document
or any other instrument or writing furnished in connection therewith; or (v) the
value, sufficiency, creation, perfection or priority of any interest in any
collateral security. The Agent shall have no duty to disclose to the Lenders
information that is not
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required to be furnished by the Company or any Subsidiary to the Agent at such
time, but is voluntarily furnished by the Company or any Subsidiary to the Agent
(either in its capacity as Agent or in its individual capacity).
7.5. Action on Instructions of Lenders. The Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and under any
other Loan Document in accordance with written instructions signed by the
Required Lenders, and such instructions and any action taken or failure to act
pursuant thereto shall be binding on all of the Lenders and on all holders of
Notes. The Lenders hereby acknowledge that the Agent shall be under no duty to
take any discretionary action permitted to be taken by it pursuant to the
provisions of this Agreement or any other Loan Document unless it shall be
requested in writing to do so by the Required Lenders. The Agent shall be fully
justified in failing or refusing to take any action hereunder and under any
other Loan Document unless it shall first be indemnified to its satisfaction by
the Lenders pro rata against any and all liability, cost and expense that it may
incur by reason of taking or continuing to take any such action.
7.6. Employment of Agents and Counsel. The Agent may execute any of its
duties as Agent hereunder and under any other Loan Document by or through
employees, agents, and attorneys-in-fact and shall not be answerable to the
Lenders, except as to money or securities received by it or its authorized
agents, for the default or misconduct of any such agents or attorneys-in-fact
selected by it with reasonable care. The Agent shall be entitled to advice of
counsel concerning all matters pertaining to the agency hereby created and its
duties hereunder and under any other Loan Document.
7.7. Reliance on Documents; Counsel. The Agent shall be entitled to rely
upon any Note, notice, consent, certificate, affidavit, letter, telegram,
statement, paper or document believed by it to be genuine and correct and to
have been signed or sent by the proper person or persons, and, in respect to
legal matters, upon the opinion of counsel selected by the Agent, which counsel
may be employees of the Agent.
7.8. Agent's Reimbursement and Indemnification. The Lenders agree to
reimburse and indemnify the Agent ratably in proportion to their respective
Commitments (or, if the Commitments have been terminated, in proportion to their
Commitments immediately prior to such termination) (i) for any amounts not
reimbursed by the Borrowers for which the Agent is entitled to reimbursement by
the a Borrower under the Loan Documents, (ii) for any other expenses incurred by
the Agent on behalf of the Lenders, in connection with the preparation,
execution, delivery, administration and enforcement of the Loan Documents and
(iii) for any liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind and nature
whatsoever which may be imposed on, incurred by or asserted against the Agent in
any way relating to or arising out of the Loan Documents or any other document
delivered in connection therewith or the transactions contemplated thereby, or
the enforcement of any of the terms thereof or of any such other documents,
provided that no Lender shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the Agent. The
obligations of the Lenders under this Section 7.8 shall survive payment of the
Obligations and termination of this Agreement.
7.9. Notice of Default. The Agent shall not be deemed to have knowledge or
notice of the occurrence of any Unmatured Event or Event of Default hereunder
unless the Agent has received written notice from a Lender or the Company
referring to this Agreement describing such Default or Unmatured Default and
stating that such notice is a "notice of default". In the event that the Agent
receives such a notice, the Agent shall give prompt notice thereof to the
Lenders.
7.10. Rights as a Lender. In the event the Agent is a Lender, the Agent
shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the
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same as though it were not the Agent, and the term "Lender" or "Lenders" shall,
at any time when the Agent is a Lender, unless the context otherwise indicates,
include the Agent in its individual capacity. The Agent may accept deposits
from, lend money to, and generally engage in any kind of trust, debt, equity or
other transaction, in addition to those contemplated by this Agreement or any
other Loan Document, with the Company or any of its Subsidiaries in which the
Company or such Subsidiary is not restricted hereby from engaging with any other
Person. The Agent, in its individual capacity, is not, subject to Section 8.6,
obligated to remain a Lender.
7.11. Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any other Lender and based
on the financial statements prepared by the Company and such other documents and
information as it has deemed appropriate, made its own credit analysis and
decision to enter into this Agreement and the other Loan Documents. Each Lender
also acknowledges that it will, independently and without reliance upon the
Agent or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under this Agreement and the other Loan Documents.
7.12. Successor Agent. The Agent may resign at any time by giving written
notice thereof to the Lenders and the Company, such resignation to be effective
upon the appointment of a successor Agent or, if no successor Agent has been
appointed, forty-five days after the retiring Agent gives notice of its
intention to resign. Upon any such resignation, the Required Lenders shall have
the right to appoint, on behalf of the Company and the Lenders, a successor
Agent. If no successor Agent shall have been so appointed by the Required
Lenders within thirty days after the resigning Agent's giving notice of its
intention to resign, then the resigning Agent may appoint, on behalf of the
Company and the Lenders, a successor Agent. If the Agent has resigned and no
successor Agent has been appointed, the Lenders may perform all the duties of
the Agent hereunder and the Borrowers shall make all payments in respect of the
Obligations to the applicable Lender and for all other purposes shall deal
directly with the Lenders. No successor Agent shall be deemed to be appointed
hereunder until such successor Agent has accepted the appointment. Any such
successor Agent shall be a commercial bank having capital and retained earnings
of at least $50,000,000. Upon the acceptance of any appointment as Agent
hereunder by a successor Agent, such successor Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
resigning Agent. Upon the effectiveness of the resignation of the Agent, the
resigning Agent shall be discharged from its duties and obligations hereunder
and under the Loan Documents. After the effectiveness of the resignation of an
Agent, the provisions of this Article VII shall continue in effect for the
benefit of such Agent in respect of any actions taken or omitted to be taken by
it while it was acting as the Agent hereunder and under the other Loan
Documents.
7.13. Collateral Management. The Agent is hereby authorized on behalf of all
of the Lenders, without the necessity of any further consent from any Lender,
from time to time prior to an Event of Default, to take any action with respect
to the collateral or the Security Documents which may be necessary (i) to
perfect and maintain perfected the security interest in and liens upon the
collateral granted pursuant to the Security Documents; and (ii) to release
portions of the collateral from the security interests and liens imposed by the
Security Documents in connection with any dispositions of such portions of the
collateral permitted hereby. In the event that the Borrowers or the Guarantors
desire to sell or otherwise dispose of any assets and such sale or disposition
is permitted hereby, the Agent shall, upon timely notice from the Company,
release such portions of the collateral from the security interests and liens
imposed by the Security Documents as may be specified by the Borrowers or the
Guarantors in order for the Borrowers or the Guarantors to consummate such
proposed sale or disposition, provided that at or prior to the time of such
proposed sale or disposition no Unmatured Event or Event of Default shall have
occurred and be continuing, including, without limitation, any Unmatured Event
or Event of Default that would arise upon consummation of such sale or
disposition. For purposes of the preceding
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sentence, the Company shall give timely notice if, not less than two Business
Days prior to the date of such proposed sale or disposition, it shall furnish to
the Agent an officers' certificate setting forth in reasonable detail the
circumstances of such proposed sale or disposition.
7.14. Right to Indemnity. The Agent shall be fully justified in failing or
refusing to take any action hereunder unless it shall first be indemnified to
its satisfaction by the Lenders pro rata against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action.
7.15. Sharing of Payments. The Lenders agree among themselves that, in the
event that any Lender shall obtain payment in respect of any Advance or any
other obligation owing to the Lenders under this Agreement through the exercise
of a right of set-off, banker's lien, counterclaim or otherwise in excess of its
ratable share of payments received by all of the Lenders on account of the
Advances and other obligations (or if no Advances are outstanding, ratably
according to the respective amounts of the Commitments), such Lender shall
promptly purchase from the other Lenders participations in such Advances and
other obligations in such amounts, and make such other adjustments from time to
time, as shall be equitable to the end that all of the Lenders share such
payment in accordance with such ratable shares. The Lenders further agree among
themselves that if payment to a Lender obtained by such Lender through the
exercise of a right of set-off, banker's lien, counterclaim or otherwise as
aforesaid shall be rescinded or must otherwise be restored, each Lender which
shall have shared the benefit of such payment shall, by repurchase of
participations theretofore sold, return its share of that benefit to each Lender
whose payment shall have been rescinded or otherwise restored. The Borrowers
agree that any Lender so purchasing such a participation may, to the fullest
extent permitted by law, exercise all rights of payment, including set-off,
banker's lien or counterclaim, with respect to such participation as fully as if
such Lender were a holder of such Advance or other obligation in the amount of
such participation. The Lenders further agree among themselves that, in the
event that amounts received by the Lenders and the Agent hereunder are
insufficient to pay all such obligations or insufficient to pay all such
obligations when due, the fees and other amounts owing to the Agent in such
capacity shall be paid therefrom before payment of obligations owing to the
Lenders under this Agreement. Except as otherwise expressly provided in this
Agreement, if any Lender or Agent shall fail to remit to the Agent or any other
Lender an amount payable by such Lender or Agent to the Agent or such other
Lender pursuant to this Agreement on the date when such amount is due, such
payments shall be made together with interest thereon for each date from the
date such amount is due until the date such amount is paid to the Agent or such
other Lender at a rate per annum equal to the rate at which borrowings are
available to the payee in its overnight federal funds market. It is further
understood and agreed among the Lenders and the Agent that if the Agent shall
engage in any other transactions with the Company or any of its Subsidiaries and
shall have the benefit of any collateral or security therefor which does not
expressly secure the obligations arising under this Agreement except by virtue
of a so-called dragnet clause or comparable provision, the Agent shall be
entitled to apply any proceeds of such collateral or security first in respect
of the obligations arising in connection with such other transaction before
application to the obligations arising under this Agreement.
7.16. Withholding Tax Exemption. Each Lender that is not organized and
incorporated under the laws of the United States or any State thereof agrees to
file with the Agent and the Company, in duplicate, (a) on or before the later of
(i) the Effective Date and (ii) the date such Lender becomes a Lender under this
Agreement and (b) thereafter, for each taxable year of such Lender (in the case
of a Form 4224) or for each third taxable year of such Lender (in the case of
any other form) during which interest or fees arising under this Agreement and
the Notes are received, unless not legally able to do so as a result of a change
in United States income tax enacted, or treaty promulgated, after the date
specified in the preceding clause (a), on or prior to the immediately following
due date of any payment by the Borrowers hereunder, a properly completed and
executed copy of either Internal Revenue Service Form
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4224 or Internal Revenue Service Form 1001 and Internal Revenue Service Form W-8
or Internal Revenue Service Form W-9 and any additional form necessary for
claiming complete exemption from United States withholding taxes (or such other
form as is required to claim complete exemption from Unites States withholding
taxes), if and as provided by the Code or other pronouncements of the United
States Internal Revenue Service, and such Lender warrants to the Borrowers that
the form so filed will be true and complete; provided that such Lender's failure
to complete and execute such Form 4224 or Form 1001, or Form W-8 or Form W-9, as
the case may be, and any such additional form (or any successor form or forms)
shall not relieve any Borrower of any of its obligations under this Agreement,
except as otherwise provided in this Section 7.16. Each Lender will promptly
execute such other documents with respect to withholding or similar taxes in any
jurisdiction other than United States or any State thereof if required to do so
to avoid any such withholding tax or similar tax, provided that such Lender is
legally entitled to do so and such Lender would not be materially prejudiced
thereby.
ARTICLE VIII
GUARANTY
As an inducement to the Lenders and the Agent to enter into the
transactions contemplated by this Agreement, the Company agrees with the
Lenders and the Agent as follows:
8.1 Guarantee of Obligations. (a) The Company hereby (i) guarantees, as
principal obligor and not as surety only, to the Lenders the prompt payment of
the principal of and any and all accrued and unpaid interest (including interest
which otherwise may cease to accrue by operation of any insolvency law, rule,
regulation or interpretation thereof) on the Advances and all other obligations
of the Borrowing Subsidiaries to the Lenders and the Agent under this Agreement
when due, whether by scheduled maturity, acceleration or otherwise, all in
accordance with the terms of this Agreement and the Notes, including, without
limitation, fees, reimbursement obligations, default interest, indemnification
payments and all reasonable costs and expenses incurred by the Lenders and the
Agent in connection with enforcing any obligations of the Borrowing Subsidiaries
hereunder, including without limitation the reasonable fees and disbursements of
counsel, (ii) guarantees the prompt and punctual performance and observance of
each and every term, covenant or agreement contained in this Agreement and the
Notes to be performed or observed on the part of the Borrowing Subsidiaries and
(iii) agrees to make prompt payment, on demand, of any and all reasonable costs
and expenses incurred by the Lenders or the Agent in connection with enforcing
the obligations of the Company hereunder, including, without limitation, the
reasonable fees and disbursements of counsel (all of the foregoing being
collectively referred to as the "Guaranteed Obligations").
(b) If for any reason any duty, agreement or obligation of any
Borrowing Subsidiary contained in this Agreement shall not be performed or
observed by any Borrowing Subsidiary as provided therein, or if any amount
payable under or in connection with this Agreement shall not be paid in full
when the same becomes due and payable, the Company undertakes to perform or
cause to be performed promptly each of such duties, agreements and obligations
and to pay forthwith each such amount to the Agent for the account of the
Lenders regardless of any defense or setoff or counterclaim which any Borrowing
Subsidiary may have or assert, and regardless of any other condition or
contingency.
8.2 Nature of Guaranty. The obligations of the Company hereunder constitute
an absolute and unconditional and irrevocable guaranty of payment and not a
guaranty of collection and are wholly independent of and in addition to other
rights and remedies of the Lenders and the Agent and are not
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contingent upon the pursuit by the Lenders and the Agent of any such rights and
remedies, such pursuit being hereby waived by the Company.
8.3 Waivers and Other Agreements. The Company hereby unconditionally (a)
waives any requirement that the Lenders or the Agent, upon the occurrence of an
Event of Default first make demand upon, or seek to enforce remedies against any
Borrowing Subsidiary before demanding payment under or seeking to enforce the
obligations of the Company hereunder, (b) covenants that the obligations of the
Company hereunder will not be discharged except by complete performance of all
obligations of the Borrowing Subsidiaries contained in this Agreement and the
Notes, (c) agrees that the obligations of the Company hereunder shall remain in
full force and effect without regard to, and shall not be affected or impaired,
without limitation, by any invalidity, irregularity or unenforceability in whole
or in part of this Agreement or the Notes, or any limitation on the liability of
the Borrowing Subsidiaries thereunder, or any limitation on the method or terms
of payment thereunder which may or hereafter be caused or imposed in any manner
whatsoever (including, without limitation, usury laws), (d) waives diligence,
presentment and protest with respect to, and any notice of default or dishonor
in the payment of any amount at any time payable by the Borrowing Subsidiaries
under or in connection with this Agreement or the Notes, and further waives any
requirement of notice of acceptance of, or other formality relating to, the
obligations of the Company hereunder and (e) agrees that the Guaranteed
Obligations shall include any amounts paid by the Borrowing Subsidiaries to the
Lenders or the Agent which may be required to be returned to the Borrowing
Subsidiaries or to their representative or to a trustee, custodian or receiver
for any Borrowing Subsidiary.
8.4 Obligations Absolute. The obligations, covenants, agreements and duties
of the Company under this Agreement shall not be released, affected or impaired
by any of the following whether or not undertaken with notice to or consent of
the Company: (a) an assignment or transfer, in whole or in part, of the Advances
made to any Borrowing Subsidiary or of this Agreement or any Note although made
without notice to or consent of the Company, or (b) any waiver by any Lender or
the Agent or by any other person, of the performance or observance by any
Borrowing Subsidiary of any of the agreements, covenants, terms or conditions
contained in this Agreement or in the other Loan Documents, or (c) any
indulgence in or the extension of the time for payment by any Borrowing
Subsidiary of any amounts payable under or in connection with this Agreement or
any other Loan Document, or of the time for performance by any Borrowing
Subsidiary of any other obligations under or arising out of this Agreement or
any other Loan Document, or the extension or renewal thereof, or (d) the
modification, amendment or waiver (whether material or otherwise) of any duty,
agreement or obligation of any Borrowing Subsidiary set forth in this Agreement
or any other Loan Document (the modification, amendment or waiver from time to
time of this Agreement and the other Loan Documents being expressly authorized
without further notice to or consent of the Company), or (e) the voluntary or
involuntary liquidation, sale or other disposition of all or substantially all
of the assets of any Borrowing Subsidiary or any receivership, insolvency,
bankruptcy, reorganization, or other similar proceedings, affecting any
Borrowing Subsidiary or any of its assets, or (f) the merger or consolidation of
any Borrowing Subsidiary or the Company with any other person, or (g) the
release of discharge of any Borrowing Subsidiary or the Company from the
performance or observance of any agreement, covenant, term or condition
contained in this Agreement or any other Loan Document, by operation of law, or
(h) any other cause whether similar or dissimilar to the foregoing which would
release, affect or impair the obligations, covenants, agreements or duties of
the Company hereunder.
8.5 No Investigation by Lenders or Agent. The Company hereby waives
unconditionally any obligation which, in absence of such provision, the Lenders
or the Agent might otherwise have to investigate or to assure that there has
been compliance with the law of any jurisdiction with respect to the Guaranteed
Obligations recognizing that, to save both time and expense, the Company has
requested that the Lenders and the Agent not undertake such investigation. The
Company hereby expressly confirms that the obligations of the Company hereunder
shall remain in full force and effect
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without regard to compliance or noncompliance with any such law and irrespective
of any investigation or knowledge of any Lender or the Agent of any such law.
8.6 Indemnity. As a separate, additional and continuing obligation, the
Company unconditionally and irrevocably undertakes and agrees with the Lenders
and the Agent that, should the Guaranteed Obligations not be recoverable from
the Company under Section 8.1 for any reason whatsoever (including, without
limitation, by reason of any provision of this Agreement or the Notes or any
other agreement or instrument executed in connection herewith being or becoming
void, unenforceable, or otherwise invalid under any applicable law) then,
notwithstanding any knowledge thereof by any Lender or the Agent at any time,
the Company as sole, original and independent obligor, upon demand by the Agent,
will make payment to the Agent for the account of the Lenders and the Agent of
the Guaranteed Obligations by way of a full indemnity in such currency and
otherwise in such manner as is provided in this Agreement and the Notes.
8.7 Subordination, Subrogation, Etc. The Company agrees that any present or
future indebtedness, obligations or liabilities of any Borrowing Subsidiary to
Company shall be fully subordinate and junior in right and priority of payment
to any present or future indebtedness, obligations or liabilities of the
Borrowing Subsidiaries to the Lenders and the Agent. The Company waives any
right of subrogation to the rights of any Lender or the Agent against any
Borrowing Subsidiary or any other person obligated for payment of the Guaranteed
Obligations and any right of reimbursement or indemnity whatsoever arising or
accruing out of any payment which the Company may make pursuant to this
Agreement and the Notes, and any right of recourse to security for the debts and
obligations of each Borrowing Subsidiary, unless and until the entire principal
balance of and interest on the Guaranteed Obligations shall have been paid in
full, and to the extent the Company is an "insider" as defined in Section 101(2)
of the United States Bankruptcy Code, such waiver shall be permanent and shall
not be revoked or terminated in any event, including payment in full of the
principal and interest of the Guaranteed Obligations.
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ARTICLE IX
MISCELLANEOUS
9.1. Amendments, Etc.
(a) No amendment, modification, termination or waiver of any provision
of this Agreement nor any consent to any departure therefrom shall be effective
unless the same shall be in writing and signed by the Required Lenders and, to
the extent any rights, obligations or duties of the Agent may be affected
thereby, the Agent, provided, however, that no such amendment, modification,
termination, waiver or consent shall, without the consent of the Agent and all
of the Lenders, (i) authorize or permit the extension of time for, or any
reduction of the amount or rate of, any payment of the principal of, or interest
on, the Notes or any Letter of Credit reimbursement obligation, or any fees or
other amount payable hereunder, (ii) amend or terminate the respective
Commitments of any Lender set forth on the signature pages hereof or modify the
provisions of this Section regarding the taking of any action under this Section
or the provisions of Section 7.15 or the definition of Required Lenders, or
(iii) release any Guarantor or any of the collateral (excluding releases of
collateral allowed pursuant to Section 5.2(g), Section 7.13 or any other
provision hereof) or release the Company from its guaranty contained in Article
VIII. In addition to amendments effected pursuant to the foregoing, Schedule
1.1(a) may be amended as follows:
(i) Schedule 1.1(a) may be amended to add Subsidiaries of the
Company as additional Borrowing Subsidiaries upon (A) execution and delivery by
the Borrowers, any such Borrowing Subsidiary and the Agent, of a Joinder
Agreement providing for any such Subsidiary to become a Borrowing Subsidiary,
(B) delivery to the Agent of (a) a legal opinion in respect of such additional
Subsidiary Borrower acceptable to the Agent and (b) such other documents with
respect thereto as the Agent shall reasonably request and (c) the written
approval of the Agent in its sole discretion.
(ii) Schedule 1.1(a) will be amended to remove any Subsidiary as a
Borrowing Subsidiary upon (A) written notice by the Company to the Agent to such
effect and (B) repayment in full of all outstanding Loans of such Borrowing
Subsidiary.
(b) Any such amendment, waiver or consent shall be effective only in
the specific instance and for the specific purpose for which given.
(c) Notwithstanding anything herein to the contrary, no Defaulting
Lender shall be entitled to vote (whether to consent or to withhold its consent)
with respect to any amendment, modification, termination or waiver of any
provision of this Agreement or any departure therefrom or any direction from the
Lenders to the Agent, and, for purposes of determining the Required Lenders at
any time, the Commitments and the Advances of each Defaulting Lenders shall be
disregarded.
9.2. Notices.
(a) Except as otherwise provided in Section 9.2(c) hereof, all notices
and other communications hereunder shall be in writing and shall be delivered or
sent to the Borrowers, the Agent and the Lenders at the respective addresses and
numbers for notices set forth on the signature pages hereof, or to such other
address as may be designated by any Borrower, the Agent or any Lender by notice
to the other parties hereto. All notices and other communications shall be
deemed to have been
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given at the time of actual delivery thereof to such address, or if sent by
certified or registered mail, postage prepaid, to such address, on the third day
after the date of mailing, or in the case of telex notice, upon receipt of the
appropriate answerback, or, in the case of facsimile notice, upon receipt of a
confirmation mechanically produced by the facsimile machine, provided, however,
that notices to the Agent shall not be effective until received.
(b) Notices by the Borrowers to the Agent with respect to terminations
or reductions of the Commitments pursuant to Section 2.2, requests for Advances
pursuant to Section 2.4, requests for continuations or conversions of Loans
pursuant to Section 2.7 and notices of prepayment pursuant to Section 3.1 shall
be irrevocable and binding on the Borrowers.
(c) Any notice to be given by the Borrowers to the Agent pursuant to
Sections 2.4, 2.7 or 3.1 and any notice to be given by the Agent or any Lender
hereunder, may be given by telephone, and all such notices given by the
Borrowers must be immediately confirmed in writing in the manner provided in
Section 9.2(a). Any such notice given by telephone shall be deemed effective
upon receipt thereof by the party to whom such notice is to be given.
9.3. No Waiver By Conduct; Remedies Cumulative. No course of dealing on the
part of the Agent or any Lender, nor any delay or failure on the part of the
Agent or any Lender in exercising any right, power or privilege hereunder shall
operate as a waiver of such right, power or privilege or otherwise prejudice the
Agent's or such Lender's rights and remedies hereunder; nor shall any single or
partial exercise thereof preclude any further exercise thereof or the exercise
of any other right, power or privilege. No right or remedy conferred upon or
reserved to the Agent or any Lender under any Loan Document is intended to be
exclusive of any other right or remedy, and every right and remedy shall be
cumulative and in addition to every other right or remedy granted thereunder or
now or hereafter existing under any applicable law. Every right and remedy
granted by any Loan Document or by applicable law to the Agent or any Lender may
be exercised from time to time and as often as may be deemed expedient by the
Agent or any Lender.
9.4. Reliance on and Survival of Various Provisions. All terms, covenants,
agreements, representations and warranties of any Borrower and any Guarantor
made herein or in any other Loan Document or in any certificate, report,
financial statement or other document furnished by or on behalf of any Borrower
and any Guarantor in connection with the negotiation and modification of this
Agreement shall be deemed to have been relied upon by the Lenders,
notwithstanding any investigation heretofore or hereafter made by any Lender or
on such Lender's behalf, and those covenants and agreements of the Borrowers set
forth in Section 3.9, 3.11 and 9.5 hereof shall survive the repayment in full of
the Advances and the termination of the Commitments.
9.5. Expenses; Indemnification.
(a) The Company agrees to pay, or reimburse the Agent or the Lenders,
as the case may be, for the payment of, on demand, (i) the reasonable fees and
expenses of counsel to the Agent, including without limitation the fees and
expenses of Xxxxxxxxx Xxxxxx PLLC and any other counsel retained by the Agent in
connection with the preparation, execution, delivery and administration of the
Loan Documents and the consummation of the transactions contemplated hereby, and
in connection with advising the Agent as to its rights and responsibilities with
respect thereto, and in connection with any amendments, waivers or consents in
connection therewith or in connection with any refinancing or restructuring of
the credit arrangements provided under this Agreement, (ii) all stamp and other
taxes and fees payable or determined to be payable in connection with the
execution, delivery, filing or recording of the Loan Documents and the
consummation of the transactions contemplated hereby, and any and all
liabilities with respect to or resulting from any delay in paying or omitting to
pay such taxes or fees, (iii)
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if an Event of Default occurs, all reasonable costs and expenses of the Agent
and each Lender (including reasonable fees and expenses of counsel and whether
incurred through negotiations, legal proceedings or otherwise) in connection
with such Event of Default and collection, bankruptcy, insolvency and other
enforcement proceedings resulting therefrom and (iv) all reasonable costs and
expenses of the Agent (including reasonable fees and expenses of counsel) in
connection with any action or proceeding relating to a court order, injunction
or other process or decree restraining or seeking to restrain the Agent from
paying any amount under, or otherwise relating in any way to, any Letter of
Credit and any and all costs and expenses which any of them may incur relative
to any payment under any Letter of Credit.
(b) The Company agrees to indemnify each Lender, the Agent and each of
their respective officers, directors, employees and agents (collectively, the
"Indemnified Parties") and hold each Indemnified Party harmless from and against
any and all liabilities, losses, damages, costs and expenses of any kind,
including, without limitation, the reasonable fees and disbursements of counsel,
which may be incurred by any Indemnified Party in connection with any
investigative, administrative or judicial proceeding (whether or not such
Indemnified Party shall be designated a party thereto) (collectively, the
"Indemnified Liabilities") at any time relating to (whether before or after the
execution of this Agreement) any of the following:
(i) any actual or proposed use of the Advances hereunder by the
Company or any of its Subsidiaries or Unrestricted Subsidiaries or any
transaction financed or to be financed in whole or in part, directly or
indirectly, with the proceeds of any Advance;
(ii) the entering into and performance of this Agreement and any
other Loan Document by any of the Indemnified Parties (including any action
brought by or on behalf of any Borrower as the result of any determination by
any Lender not to make any Advance unless such Advance was required to be made
under this Agreement);
(iii) any investigation, litigation or proceeding related to any
acquisition or proposed acquisition by the Company or any of its Subsidiaries of
all or any portion of the stock or assets of any Person or to the issuance of,
or any other matter relating to, any Subordinated Debt, whether or not any
Indemnified Party is a party thereto;
(iv) any investigation, litigation or proceeding related to any
environmental cleanup, audit, compliance or other matter relating to any release
by the Company or any of its Subsidiaries of any Hazardous Material or any
violations of Environmental Laws; or
(v) the presence on or under, or the escape, seepage, leakage,
spillage, discharge, emission, discharging or releases from, any real property
owned or operated by the Company or any Subsidiary thereof of any Hazardous
Material (including any losses, liabilities, damages, injuries, costs, expenses
or claims asserted or arising under any Environmental Law), regardless of
whether caused by, or within the control of, the Company or such Subsidiary,
except for any such Indemnified Liabilities arising for the account of a
particular Indemnified Party by reason of the activities of the Indemnified
Party on the property of the Company or any of its Subsidiaries conducted
subsequent to a foreclosure on such property by any Indemnified Party or by
reason of the relevant Indemnified Party's gross negligence or willful
misconduct or breach of this Agreement, and if and to the extent that the
foregoing undertaking may be unenforceable for any reason, the Company hereby
agrees to make the maximum contribution to the payment and satisfaction of each
of the Indemnified Liabilities which is permissible under applicable law. The
Company shall be obligated to indemnify the Indemnified Parties for all
Indemnified Liabilities subject to and pursuant to the foregoing provisions,
regardless of whether the Company or any of its Subsidiaries had knowledge of
the facts and circumstances giving rise to such Indemnified Liability;
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provided that no Indemnified Party shall have the right to be indemnified
hereunder for its own gross negligence or willful misconduct as determined by a
court of competent jurisdiction.
9.6. Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, provided that no
Borrower may, without the prior consent of all the Lenders, assign their rights
or obligations under any Loan Document and the Lenders shall not be obligated to
make any Advance hereunder to any entity other than a Borrower.
(b) Any Lender may sell a participation interest to any financial
institution or institutions, and such financial institution or institutions may
further sell, a participation interest (undivided or divided) in, the Advances
and such Lender's rights and benefits under the Loan Documents, and to the
extent of that participation, such participant or participants shall have the
same rights and benefits against the Borrowers under Section 6.2(c) as it or
they would have had if participation of such participant or participants were
the Lender making the Advances to the Borrowers hereunder, provided, however,
that (i) such Lender's obligations under this Agreement shall remain unmodified
and fully effective and enforceable against such Lender, (ii) such Lender shall
remain solely responsible to the other parties hereto for the performance of
such obligations, (iii) such Lender shall remain the holder of its Notes for all
purposes of this Agreement, (iv) the Borrowers, the Agent and the other Lenders
shall continue to deal solely and directly with such Lender in connection with
such Lender's rights and obligations under this Agreement, (v) such Lender shall
not grant to its participant any rights to consent or withhold consent to any
action taken by such Lender or the Agent under this Agreement other than action
requiring the consent of all of the Lenders hereunder and (iv) such
participation shall in no event be less than $5,000,000. The Agent from time to
time in its sole discretion may appoint agents for the purpose of servicing and
administering this Agreement and the transactions contemplated hereby and
enforcing or exercising any rights or remedies of the Agent provided under the
Loan Documents or otherwise. In furtherance of such agency, the Agent may from
time to time direct that the Borrowers provide notices, reports and other
documents contemplated by this Agreement (or duplicates thereof) to such agent.
The Borrowers hereby consent to the appointment of such agent and agrees to
provide all such notices, reports and other documents and to otherwise deal with
such agent acting on behalf of the Agent in the same manner as would be required
if dealing with the Agent itself.
(c) Each Lender may, with the prior written consent of the Company,
which consent from the Company shall not be unreasonably withheld or delayed and
shall not be required if any Event of Default has occurred and is continuing or
if such assignment is to an Affiliate of a Lender or to another Lender, and the
prior written consent of the Agent, which consent from the Agent shall not be
required if such assignment is to an Affiliate of a Lender or to another Lender,
assign to one or more banks or other entities all or a portion of its rights and
obligations under this Agreement (including, without limitation, all or a
portion of its Commitment, the Advances owing to it and the Note or Notes held
by it); provided, however, that (i) each such assignment shall be of a uniform,
and not a varying, percentage of all rights and obligations, (ii) except in the
case of an assignment of all of a Lender's rights and obligations under this
Agreement, (A) other than assignments among the Lenders, the amount of the
Commitment of the assigning Lender being assigned pursuant to each such
assignment (determined as of the date of the Assignment and Acceptance with
respect to such assignment) shall in no event be less than $5,000,000, and in
integral multiples of $1,000,000 thereafter, or such lesser amount as the
Company and the Agent may consent to and (B) after giving effect to each such
assignment, the amount of the Commitment of the assigning Lender shall in no
event be less than $5,000,000, and (iii) the parties to each such assignment
shall execute and deliver to the Agent, for its acceptance and recording in the
Register, an Assignment and Acceptance in the form of Exhibit L hereto (an
"Assignment and
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Acceptance"), together with any Note or Notes subject to such
assignment and a processing and recordation fee of $3,500. Upon such execution,
delivery, acceptance and recording, from and after the effective date specified
in such Assignment and Acceptance, (x) the assignee thereunder shall be a party
hereto and, to the extent that rights and obligations hereunder have been
assigned to it pursuant to such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder and (y) the Lender assignor thereunder shall,
to the extent that rights and obligations hereunder have been assigned by it
pursuant to such Assignment and Acceptance, relinquish its rights and be
released from its obligations under this Agreement (and, in the case of an
Assignment and Acceptance covering all of the remaining portion of an assigning
Lender's rights and obligations under this Agreement, such Lender shall cease to
be a party hereto).
(d) By executing and delivering an Assignment and Acceptance, the
Lender assignor thereunder and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, such assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
the execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other instrument or document furnished pursuant
hereto; (ii) such assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the Company
or any of its Subsidiaries or the performance or observance by any Borrower or
Guarantor of any of their obligations under any Loan Document; (iii) such
assignee confirms that it has received a copy of this Agreement, together with
copies of the financial statements referred to in Section 4.6 and such other
documents and information as it has deemed appropriate to make its own credit
analysis and decision to enter into such Assignment and Acceptance; (iv) such
assignee will, independently and without reliance under the Agent, such
assigning Lender or any other Lender and based on such documents and information
as it shall deem appropriate at the time, continue to make its own credit
decisions in taking or not taking action under this Agreement; (v) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers and discretion under this Agreement as are delegated to
the Agent by the terms hereof, together with such powers and discretion as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations that by the terms
of this Agreement are required to be performed by it as a Lender.
(e) The Agent shall maintain at its address designated on the signature
pages hereof a copy of each Assignment and Acceptance delivered to and accepted
by it and a register for the recordation of the names and addresses of the
Lenders and the Commitment of, and principal amount of the Advances owing to,
each Lender from time to time (the "Register"). The entries in the Register
shall be conclusive and binding for all purposes, absent manifest error, and the
Borrowers, the Agent and the Lenders may treat each Person whose name is
recorded in the Register as a Lender hereunder for all purposes of this
Agreement. The Register shall be available for inspection by the Borrowers or
any Lender at any reasonable time and from time to time upon reasonable prior
notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee, together with any Note or Notes subject to
such assignment, the Agent shall, if such Assignment and Acceptance has been
completed, (i) accept such Assignment and Acceptance, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Company. Within five Business Days after its receipt of such
notice, each Borrower, at its own expense, shall execute and deliver to the
Agent in exchange for the surrendered Note or Notes a new Note or Notes to the
order of such assignee in an amount equal to the Commitment assumed by it
pursuant to such Assignment and Acceptance and, if the assigning Lender has
retained a Commitment hereunder, a new Note to the order of the assigning Lender
in an amount equal to the Commitment retained by it hereunder. Such new Note or
Notes shall be in an aggregate principal amount equal to the aggregate
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principal amount of such surrendered Note or Notes, shall be dated the effective
date of such Assignment and Acceptance and shall otherwise be in substantially
the form of Exhibit L hereto.
(g) The Lenders may, in connection with any assignment or participation
or proposed assignment or participation pursuant to this Section 9.6, disclose
to the assignee or participant or proposed assignee or participant, any
information relating to the Company or any of its Subsidiaries, provided that
assignee or participant agrees to the confidentiality provisions contained in
Section 9.19.
(h) Notwithstanding any other provision set forth in this Agreement,
any Lender may at any time create a security interest in, or assign, all or any
portion of its rights under this Agreement (including, without limitation, the
Loans owing to it and the Note or Notes held by it) in favor of any Federal
Reserve Lender in accordance with Regulation A of the Board of Governors of the
Federal Reserve System; provided that such creation of a security interest or
assignment shall not release such Lender from its obligations under this
Agreement.
9.7. Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may execute this Agreement by signing
any such counterpart.
9.8. Governing Law. This Agreement is a contract made under, and shall be
governed by and construed in accordance with, the law of the State of Michigan
in the same manner applicable to contracts made and to be performed entirely
within such State and without giving effect to choice of law principles of such
State. Each Borrower further agrees that any legal action or proceeding with
respect to any Loan Document or the transactions contemplated hereby may be
brought in any court of the State of Michigan, or in any court of the United
States of America sitting in Michigan, and each Borrower hereby submits to and
accepts generally and unconditionally the jurisdiction of those courts with
respect to its Person and property and irrevocably consents to the service of
process in connection with any such action or proceeding by personal delivery to
the Company or by the mailing thereof by registered or certified mail, postage
prepaid to the Company at its address set forth on the signature pages hereof or
as provided pursuant to Section 9.2. Nothing in this paragraph shall affect the
right of the Lenders and the Agent to serve process in any other manner
permitted by law or limit the right of the Lenders or the Agent to bring any
such action or proceeding against any Borrower or property in the courts of any
other jurisdiction. Each Borrower hereby irrevocably waives any objection to the
laying of venue of any such suit or proceeding in the above described courts.
9.9. Table of Contents and Headings. The table of contents and the headings
of the various subdivisions hereof are for the convenience of reference only and
shall in no way modify any of the terms or provisions hereof.
9.10. Construction of Certain Provisions. If any provision of this Agreement
refers to any action to be taken by any Person, or which such Person is
prohibited from taking, such provision shall be applicable whether such action
is taken directly or indirectly by such Person, whether or not expressly
specified in such provision.
9.11. Integration and Severability. This Agreement embodies the entire
agreement and understanding between the Borrowers and the Agent and the Lenders,
and supersedes all prior agreements and understandings, relating to the subject
matter hereof. In case any one or more of the obligations of any Borrower under
any Loan Document shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
obligations of such Borrower shall not in any way be affected or impaired
thereby, and such invalidity, illegality or unenforceability in one
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jurisdiction shall not affect the validity, legality or enforceability of the
obligations of any Borrower under any Loan Document in any other jurisdiction.
9.12. Independence of Covenants. All covenants hereunder shall be given
independent effect so that if a particular action or condition is not permitted
by any such covenant, the fact that it would be permitted by an exception to, or
would be otherwise within the limitations of, another covenant shall not avoid
the occurrence of an Unmatured Event or an Event of Default or any event or
condition which with notice or lapse of time, or both, could become such an
Unmatured Event or an Event of Default if such action is taken or such condition
exists.
9.13. Interest Rate Limitation. Notwithstanding any provision of any Loan
Document, in no event shall the amount of interest paid or agreed to be paid by
the Borrowers exceed an amount computed at the highest rate of interest
permissible under applicable law. If, from any circumstances whatsoever,
fulfillment of any provision of any Loan Document at the time performance of
such provision shall be due, shall involve exceeding the interest rate
limitation validly prescribed by law which a court of competent jurisdiction may
deem applicable hereto, then, ipso facto, the obligations to be fulfilled shall
be reduced to an amount computed at the highest rate of interest permissible
under applicable law, and if for any reason whatsoever the Lender shall ever
receive as interest an amount which would be deemed unlawful under such
applicable law such interest shall be automatically applied to the payment of
principal of the Advances outstanding hereunder (whether or not then due and
payable) and not to the payment of interest, or shall be refunded to the
Borrowers if such principal and all other obligations of the Borrowers to the
Lenders have been paid in full.
9.14. Judgment and Payment.
(a) If, for the purpose of obtaining judgment in any court, it is
necessary to convert a sum owing hereunder by any Borrower in one currency into
another currency, each Borrower agrees, to the fullest extent that it may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures in the relevant jurisdiction the
relevant Lender could purchase the first currency with such other currency for
the first currency on the Business Day immediately preceding the day on which
the final judgment is given.
(b) The obligations of any Borrower in respect of any sum due in
Dollars to any party hereto or any holder of the obligations owing hereunder
(the "Applicable Creditor") shall, notwithstanding any payment obligation or
judgment in a currency (the "Payment Currency") other than Dollars, be
discharged only to the extent that, on the Business Day following receipt by the
Applicable Creditor of any sum adjudged to be so due in the Payment Currency,
the Applicable Creditor may in accordance with normal banking procedures in the
relevant jurisdiction purchase Dollars with the Payment Currency; if the amount
of Dollars so purchased is less than the sum originally due to the Applicable
Creditor in Dollars, such Borrower agrees, as a separate obligation and
notwithstanding any such judgment, to indemnify the Applicable Creditor against
such loss. The obligations of the Borrowers contained in this Section 9.14 shall
survive the termination of this Agreement and the payment of all other amounts
owing hereunder.
9.15. Acknowledgments. Each Borrower hereby acknowledges that:
(a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents;
(b) none of the Agent or any Lender has any fiduciary relationship with
or duty to such Borrower arising out of or in connection with this Agreement or
any of the other Loan Documents,
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and the relationship between the Agent and the Lenders, on the one hand, and the
Borrowers, on the other hand, in connection herewith or therewith is solely that
of debtor and creditor; and
(c) no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrowers and the Lenders.
9.16. Borrowing Subsidiary Payments. Notwithstanding any other provision in
this Agreement to the contrary and without limiting any Borrowing Subsidiary's
obligations under its Guaranty, other Security Documents or otherwise other than
under this Agreement, no Borrowing Subsidiary shall be liable for any payment
obligation hereunder except as such payment obligation arises out of the Loans
and Advances of such Borrowing Subsidiary.
9.17. Unification of Certain Currencies. Notwithstanding the commencement of
the third stage of European Monetary Union ("EMU") (which as of the date of this
Agreement is scheduled to occur on January 1, 1999), all Advances denominated in
any Eligible Currency shall continue to be so denominated, interest rates with
respect to Eurocurrency Loans denominated in any Eligible Currency shall
continue to be determined by reference to such Permitted Currency in accordance
with the procedures specified in the definition of "Eurocurrency Rate", all
calculations with respect to Advances outstanding in any Eligible Currency shall
continue to be made in units of such currency, and the obligations of the
Borrowers with respect to payments of principal and interest on Advances
outstanding in any Eligible Currency shall continue to be payable in such
currency, all without regard to the conversion rates or rounding rules referred
to in European Council Regulation 96/0249 (CNS). Following the commencement of
the third stage of EMU and prior to the first issuance of euro-bank notes by the
European Central Bank pursuant to Article 105A(1) of the Treaty Establishing the
European Community, as amended, (which as of the date of this Agreement is
scheduled to occur on January 1, 2002) each of the Borrowers, the Lenders, and
the Agent agrees to negotiate in good faith an amendment to this Agreement,
satisfactory in form and substance to each of the Borrowers, the Lenders, and
the Agent to modify this Agreement in light of EMU.
9.18. Year 2000 Problem. The Borrowers and their respective Subsidiaries
have reviewed the areas within their business and operations which could be
adversely affected by, and have developed or are developing a program to address
on a timely basis, the "Year 2000 Problem" (that is, the risk that computer
applications used by the Company and its Subsidiaries may be unable to recognize
and perform properly date-sensitive functions involving certain dates prior to
and any date after December 31, 1999). Based on such review and program, the
Borrowers reasonably believe that the "Year 2000 Problem" will not have a
Material Adverse Effect.
9.19. Confidentiality. Each Lender and the Agent agree to keep any
information delivered or made available by the Obligors to it confidential from
anyone other than persons employed or retained by such Lender who are expected
to become engaged in evaluating, approving, structuring or administering the
Loans; provided that nothing herein shall prevent any Lender from disclosing
such information (a) to any other Lender or to the Agent, (b) to any other
person if reasonably incidental to the administration of the Loans, (c) upon the
order of any court or administrative agency or otherwise required by law, (d)
upon the request or demand of any regulatory agency or authority, (e) which had
been publicly disclosed other than as a result of a disclosure by the Agent or
any Lender prohibited by this Agreement, (f) in connection with any litigation
to which the Agent, any Lender or its subsidiaries or Parent may be a party, (g)
to the extent necessary in connection with the exercise of any remedy hereunder,
(h) to such Lender's or Agent's legal counsel and independent auditors and (i)
subject to a confidentiality agreement containing provisions substantially
similar to those contained in this Section made for the benefit of the
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Borrowers by such actual or proposed participation in or assignee of any lender
Indebtedness, to any actual or proposed participate or assignee of any Lender
Indebtedness.
9.20. WAIVER OF JURY TRIAL. THE LENDERS AND THE AGENTS AND THE BORROWERS,
AFTER CONSULTING OR HAVING HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL,
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO
A TRIAL BY JURY IN ANY LITIGATION BASED UPON OR ARISING OUT OF ANY LOAN DOCUMENT
OR ANY RELATED INSTRUMENT OR AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
BY THIS AGREEMENT OR ANY COURSE OF CONDUCT, DEALING, STATEMENTS (WHETHER ORAL OR
WRITTEN) OR ACTIONS OF EITHER OF THEM. NEITHER ANY LENDER, THE AGENT NOR ANY
BORROWER SHALL SEEK TO CONSOLIDATE, BY COUNTERCLAIM OR OTHERWISE, ANY SUCH
ACTION IN WHICH A JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A
JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. THESE PROVISIONS SHALL NOT BE
DEEMED TO HAVE BEEN MODIFIED IN ANY RESPECT OR RELINQUISHED BY ANY PARTY HERETO
EXCEPT BY A WRITTEN INSTRUMENT EXECUTED BY SUCH PARTY.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the day and year first above written, which
shall be the Effective Date of this Agreement.
Address for Notices: MSX INTERNATIONAL, INC.
000 Xxx Xxxxxxxxx
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer By:_____________________________
Facsimile No.: (000) 000-0000 Its:_________________________
000 Xxx Xxxxxxxxx GEOMETRIC RESULTS INCORPORATED
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer By:____________________________
Facsimile No.: (000) 000-0000 Its: ______________________
000 Xxx Xxxxxxxxx XXX XXXXXXXXXXXXX (XXX), INC.
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer By:____________________________
Facsimile No.: (000) 000-0000 Its: ______________________
275 Xxx Boulevard MSX INTERNATIONAL BUSINESS
Xxxxxx Xxxxx, Xxxxxxxx 00000 SERVICES INC.
Attention: Chief Financial Officer By:____________________________
Facsimile No. (000) 000-0000 Its: _______________________
275 Xxx Boulevard MSX INTERNATIONAL ENGINEERING
Xxxxxx Xxxxx, Xxxxxxxx 00000 SERVICES, INC.
Attention: Chief Financial Officer
Facsimile No.: (000) 000-0000 By:____________________________
Its: ______________________
000 Xxx Xxxxxxxxx MSX INTERNATIONAL, LIMITED
Xxxxxx Xxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer By:____________________________
Facsimile No.(000) 000-0000 Its: ______________________
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611 Xxxxxxxx Avenue NBD BANK, as Agent
Xxxxxxx, Xxxxxxxx 00000
Attention: Michigan Banking Division By:_______________________
Facsimile No.: (000) 000-0000 Its: First Vice President
c/o NBD Bank THE FIRST NATIONAL BANK OF
000 Xxxxxxxx Xxxxxx XXXXXXX
Xxxxxxx, Xxxxxxxx 00000
Attention: Michigan Banking Division By:____________________________
Facsimile No.: (000) 000-0000 Its: _______________________
Revolving Credit Commitment: $100,000,000
Term Loan Commitment: $30,000,000
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