EXHIBIT 10.3
REVOLVING CREDIT AGREEMENT
DATED as of February 25, 1998
among
AMERICAN RESTAURANT GROUP, INC.,
Its Subsidiaries Listed as Borrowers herein,
BANKBOSTON, N.A., as Agent,
and
The BANKS Listed on SCHEDULE 1 hereto
TABLE OF CONTENTS
1. DEFINITIONS AND RULES OF INTERPRETATION. . . . . . . . . . . . . .1
1.1. Definitions. . . . . . . . . . . . . . . . . . . . . . . .1
1.2. Rules of Interpretation. . . . . . . . . . . . . . . . . .18
2. THE REVOLVING CREDIT FACILITY. . . . . . . . . . . . . . . . . . .19
2.1. Commitment to Lend. . . . . . . . . . . . . . . . . . . . .19
2.2. Commitment Fee. . . . . . . . . . . . . . . . . . . . . . .20
2.3. Reduction of Total Commitment. . . . . . . . . . . . . . .20
2.4. The Notes. . . . . . . . . . . . . . . . . . . . . . . . .21
2.5. Interest on Loans. . . . . . . . . . . . . . . . . . . . .21
2.6. Requests for Loans. . . . . . . . . . . . . . . . . . . . .21
2.7. Conversion Options. . . . . . . . . . . . . . . . . . . . .22
2.7.1. Conversion to Different Type of Loan. . . . . . . .22
2.7.2. Continuation of Type of Loan. . . . . . . . . . . .22
2.7.3. Eurodollar Rate Loans. . . . . . . . . . . . . . .23
2.8. Funds for Loans. . . . . . . . . . . . . . . . . . . . . .23
2.8.1. Funding Procedures. . . . . . . . . . . . . . . . .23
2.8.2. Advances by Agent. . . . . . . . . . . . . . . . .23
2.9. Application of Amounts In BKB Concentration Account. . . .24
2.9.1. Application of Payments. . . . . . . . . . . . . .24
2.9.2. Repayments of Loans After Event of Default. . . . .25
3. REPAYMENT OF THE LOANS. . . . . . . . . . . . . . . . . . . . . .26
3.1. Maturity. . . . . . . . . . . . . . . . . . . . . . . . . .26
3.2. Mandatory Repayments of Loans. . . . . . . . . . . . . . .26
3.3. Optional Repayments of Loans. . . . . . . . . . . . . . . .26
4. LETTERS OF CREDIT. . . . . . . . . . . . . . . . . . . . . . . . .27
4.1. Letter of Credit Commitments.. . . . . . . . . . . . . . . .27
4.1.1. Commitment to Issue Letters of Credit. . . . . . .27
4.1.2. Letter of Credit Applications. . . . . . . . . . .27
4.1.3. Terms of Letters of Credit. . . . . . . . . . . . .27
4.1.4. Reimbursement Obligations of Banks. . . . . . . . .28
4.1.5. Participations of Banks. . . . . . . . . . . . . .28
4.2. Reimbursement Obligation of the Borrowers. . . . . . . . .28
4.3. Letter of Credit Payments. . . . . . . . . . . . . . . . .29
4.4. Obligations Absolute. . . . . . . . . . . . . . . . . . . .30
4.5. Reliance by Issuer. . . . . . . . . . . . . . . . . . . . .30
4.6. Letter of Credit Fee. . . . . . . . . . . . . . . . . . . .31
5. CERTAIN GENERAL PROVISIONS. . . . . . . . . . . . . . . . . . . .31
5.1. Closing Fee. . . . . . . . . . . . . . . . . . . . . . . .31
5.2. Agent's Fee. . . . . . . . . . . . . . . . . . . . . . . .31
5.3. Funds for Payments. . . . . . . . . . . . . . . . . . . . .32
5.3.1. Payments to Agent. . . . . . . . . . . . . . . . .32
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5.3.2. No Offset, etc. . . . . . . . . . . . . . . . . . .32
5.4. Computations. . . . . . . . . . . . . . . . . . . . . . . .32
5.5. Inability to Determine Eurodollar Rate. . . . . . . . . . .33
5.6. Illegality. . . . . . . . . . . . . . . . . . . . . . . . .33
5.7. Additional Costs, etc. . . . . . . . . . . . . . . . . . .33
5.8. Capital Adequacy. . . . . . . . . . . . . . . . . . . . . .35
5.9. Certificate. . . . . . . . . . . . . . . . . . . . . . . . .35
5.10. Indemnity. . . . . . . . . . . . . . . . . . . . . . . . . .36
5.11. Interest After Default. . . . . . . . . . . . . . . . . . .36
5.11.1. Overdue Amounts. . . . . . . . . . . . . . . . . .36
5.11.2. Amounts Not Overdue. . . . . . . . . . . . . . . .36
Section 5.12. Concerning Joint and Several Liability of the
Borrowers. . . . . . . . . . . . . . . . . . . . . . . . . . . .36
6. COLLATERAL SECURITY. . . . . . . . . . . . . . . . . . . . . . . .39
7. REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . . . . .39
7.1. Corporate Authority. . . . . . . . . . . . . . . . . . . .40
7.1.1. Incorporation; Good Standing. . . . . . . . . . . .40
7.1.2. Authorization. . . . . . . . . . . . . . . . . . .40
7.1.3. Enforceability. . . . . . . . . . . . . . . . . . .40
7.2. Governmental Approvals. . . . . . . . . . . . . . . . . . .41
7.3. Title to Properties; Leases. . . . . . . . . . . . . . . .41
7.4. Financial Statements and Projections. . . . . . . . . . . .41
7.4.1. Fiscal Year. . . . . . . . . . . . . . . . . . . .41
7.4.2. Financial Statements. . . . . . . . . . . . . . . .41
7.4.3. Projections. . . . . . . . . . . . . . . . . . . .42
7.5. No Material Changes, etc. . . . . . . . . . . . . . . . . .42
7.6. Franchises, Patents, Copyrights, etc. . . . . . . . . . . .42
7.7. Litigation. . . . . . . . . . . . . . . . . . . . . . . . .42
7.8. No Materially Adverse Contracts, etc. . . . . . . . . . . .43
7.9. Compliance with Other Instruments, Laws, etc. . . . . . . .43
7.10. Tax Status. . . . . . . . . . . . . . . . . . . . . . . . .43
7.11. No Event of Default. . . . . . . . . . . . . . . . . . . . .44
7.12. Holding Company and Investment Company Acts. . . . . . . . .44
7.13. Absence of Financing Statements, etc. . . . . . . . . . . .44
7.14. Perfection of Security Interest. . . . . . . . . . . . . . .44
7.15. Certain Transactions. . . . . . . . . . . . . . . . . . . .44
7.16. Employee Benefit Plans. . . . . . . . . . . . . . . . . . .45
7.16.1. In General. . . . . . . . . . . . . . . . . . . .45
7.16.2. Terminability of Welfare Plans. . . . . . . . . .45
7.16.3. Guaranteed Pension Plans. . . . . . . . . . . . .45
7.16.4. Multiemployer Plans. . . . . . . . . . . . . . . .46
7.17. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . .46
7.17.1. General. . . . . . . . . . . . . . . . . . . . . .46
7.17.2. Regulations U and X. . . . . . . . . . . . . . . .46
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7.17.3. Ineligible Securities. . . . . . . . . . . . . . .47
7.18. Environmental Compliance. . . . . . . . . . . . . . . . .47
7.19. Subsidiaries, etc. . . . . . . . . . . . . . . . . . . . .49
7.20. Bank Accounts. . . . . . . . . . . . . . . . . . . . . . .49
7.21. Year 2000 Problem. . . . . . . . . . . . . . . . . . . . .49
7.22. Disclosure. . . . . . . . . . . . . . . . . . . . . . . .50
7.23. Recapitalization. . . . . . . . . . . . . . . . . . . . .50
8. AFFIRMATIVE COVENANTS OF THE BORROWERS. . . . . . . . . . . . . .50
8.1. Punctual Payment. . . . . . . . . . . . . . . . . . . . . .50
8.2. Maintenance of Office. . . . . . . . . . . . . . . . . . .51
8.3. Records and Accounts. . . . . . . . . . . . . . . . . . . .51
8.4. Financial Statements, Certificates and Information. . . . .51
8.5. Notices. . . . . . . . . . . . . . . . . . . . . . . . . .53
8.5.1. Defaults. . . . . . . . . . . . . . . . . . . . . .53
8.5.2. Environmental Events. . . . . . . . . . . . . . . .53
8.5.3. Notification of Claim against Collateral. . . . . .54
8.5.4. Notice of Litigation and Judgments. . . . . . . . .54
8.6. Corporate Existence; Maintenance of Properties. . . . . . .54
8.7. Insurance. . . . . . . . . . . . . . . . . . . . . . . . .55
8.8. Taxes. . . . . . . . . . . . . . . . . . . . . . . . . .55
8.9. Inspection of Properties and Books, etc. . . . . . . . . .55
8.9.1. General. . . . . . . . . . . . . . . . . . . . . .55
8.9.2. Communications with Accountants. . . . . . . . . .56
8.10. Compliance with Laws, Contracts, Licenses, and Permits. . .56
8.11. Employee Benefit Plans. . . . . . . . . . . . . . . . . . .56
8.12. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . .57
8.13. Additional Mortgaged Property. . . . . . . . . . . . . . . .57
8.14. Bank Accounts. . . . . . . . . . . . . . . . . . . . . . .58
8.14.1. General. . . . . . . . . . . . . . . . . . . . . .58
8.14.2. Acknowledgment of Application. . . . . . . . . . .58
8.15. Further Assurances. . . . . . . . . . . . . . . . . . . .59
8.16. Post-Closing Undertakings. . . . . . . . . . . . . . . . .59
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS. . . . . . . . . . . .59
9.1. Restrictions on Indebtedness. . . . . . . . . . . . . . . .59
9.2. Restrictions on Liens. . . . . . . . . . . . . . . . . . .60
9.3. Restrictions on Investments. . . . . . . . . . . . . . . .62
9.4. Distributions. . . . . . . . . . . . . . . . . . . . . . .63
9.5. Merger, Consolidation and Disposition of Assets. . . . . .63
9.5.1. Mergers and Acquisitions. . . . . . . . . . . . . .63
9.5.2. Disposition of Assets. . . . . . . . . . . . . . .63
9.6. Sale and Leaseback. . . . . . . . . . . . . . . . . . . . .64
9.7. Compliance with Environmental Laws. . . . . . . . . . . . .64
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9.8. Indenture and Senior Notes. . . . . . . . . . . . . . . . .64
9.9. Employee Benefit Plans. . . . . . . . . . . . . . . . . . .65
9.10. Business Activities; Creation of Subsidiaries; Black
Angus of Idaho. . . . . . . . . . . . . . . . . . . . . . 65
9.11. Fiscal Year. . . . . . . . . . . . . . . . . . . . . . . .65
9.12. Transactions with Affiliates. . . . . . . . . . . . . . .66
9.13. Bank Accounts. . . . . . . . . . . . . . . . . . . . . . .66
9.14. Capitalization. . . . . . . . . . . . . . . . . . . . . .66
10. FINANCIAL COVENANTS OF THE BORROWERS. . . . . . . . . . . . . . .67
10.1. Cash Flow to Debt Service. . . . . . . . . . . . . . . . .67
10.2. Interest Coverage. . . . . . . . . . . . . . . . . . . . .67
10.3 Consolidated Net Funded Debt to EBITDA. . . . . . . . . .68
11. CLOSING CONDITIONS. . . . . . . . . . . . . . . . . . . . . . . .68
11.1. Loan Documents etc. . . . . . . . . . . . . . . . . . . .68
11.1.1. Loan Documents. . . . . . . . . . . . . . . . . .68
11.1.2. Recapitalization Documents. . . . . . . . . . . .68
11.2. Certified Copies of Charter Documents. . . . . . . . . . .69
11.3. Corporate Action. . . . . . . . . . . . . . . . . . . . .69
11.4. Incumbency Certificate. . . . . . . . . . . . . . . . . .69
11.5. Validity of Liens. . . . . . . . . . . . . . . . . . . . .69
11.6. UCC Search Results. . . . . . . . . . . . . . . . . . . .69
11.7. Survey and Taxes. . . . . . . . . . . . . . . . . . . . .70
11.8. Title Insurance. . . . . . . . . . . . . . . . . . . . . .70
11.9. Landlord Consents. . . . . . . . . . . . . . . . . . . . .70
11.10. Certificates of Insurance. . . . . . . . . . . . . . . . .70
11.11. Agency Account Agreements. . . . . . . . . . . . . . . . .70
11.12. Hazardous Waste Assessments. . . . . . . . . . . . . . . .70
11.13. Solvency Certificate. . . . . . . . . . . . . . . . . . . .71
11.14. Opinions of Counsel. . . . . . . . . . . . . . . . . . . .71
11.15. Payment of Fees. . . . . . . . . . . . . . . . . . . . . .71
11.16. Payoff Letter. . . . . . . . . . . . . . . . . . . . . . .71
11.17. Recapitalization. . . . . . . . . . . . . . . . . . . . . .71
11.18. Projected Usage of Revolving Credit Facility;
Closing Balance Sheet, etc. . . . . . . . . . . . . . . .72
11.19. Certificates Regarding Financing Statements. . . . . . . .72
11.20. Post-Closing Undertakings. . . . . . . . . . . . . . . . .72
12. CONDITIONS TO ALL BORROWINGS. . . . . . . . . . . . . . . . . . .72
12.1. Representations True; No Event of Default. . . . . . . . .73
12.2. No Legal Impediment. . . . . . . . . . . . . . . . . . . .73
12.3. Governmental Regulation. . . . . . . . . . . . . . . . . .73
12.4. Proceedings and Documents. . . . . . . . . . . . . . . . .73
13. EVENTS OF DEFAULT; ACCELERATION; ETC. . . . . . . . . . . . . . .73
13.1. Events of Default and Acceleration. . . . . . . . . . . .73
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13.2. Termination of Commitments. . . . . . . . . . . . . . . .78
13.3. Remedies. . . . . . . . . . . . . . . . . . . . . . . . .78
13.4. Distribution of Collateral Proceeds. . . . . . . . . . . .79
14. SETOFF. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .80
15. THE AGENT. . . . . . . . . . . . . . . . . . . . . . .. . . . . .81
15.1. Authorization. . . . . . . . . . . . . . . . . . . . . . .81
15.2. Employees and Agents. . . . . . . . . . . . . . . . . . .81
15.3. No Liability. . . . . . . . . . . . . . . . . . . . . . .82
15.4. No Representations. . . . . . . . . . . . . . . . . . . .82
15.4.1. General. . . . . . . . . . . . . . . . . . . . . .82
15.4.2. Closing Documentation, etc. . . . . . . . . . . .83
15.5. Payments. . . . . . . . . . . . . . . . . . . . . . . . .83
15.5.1. Payments to Agent. . . . . . . . . . . . . . . . .83
15.5.2. Distribution by Agent. . . . . . . . . . . . . . .83
15.5.3. Delinquent Banks. . . . . . . . . . . . . . . . .83
15.6. Holders of Notes. . . . . . . . . . . . . . . . . . . . .84
15.7. Indemnity. . . . . . . . . . . . . . . . . . . . . . . . .84
15.8. Agent as Bank. . . . . . . . . . . . . . . . . . . . . . .84
15.9. Resignation. . . . . . . . . . . . . . . . . . . . . . . .85
16. EXPENSES AND INDEMNIFICATION. . . . . . . . . . . . . . . . . . .85
16.1. Expenses. . . . . . . . . . . . . . . . . . . . . . . . .85
16.2. Indemnification. . . . . . . . . . . . . . . . . . . . . .86
16.3. Survival. . . . . . . . . . . . . . . . . . . . . . . . .87
17. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION. . . . . . . . . .87
17.1. Sharing of Information with Section 20 Subsidiary. . . . .87
17.2. Confidentiality. . . . . . . . . . . . . . . . . . . . . .87
17.3. Prior Notification. . . . . . . . . . . . . . . . . . . .88
17.4. Other. . . . . . . . . . . . . . . . . . . . . . . . . . .88
18. SURVIVAL OF COVENANTS, ETC. . . . . . . . . . . . . . . . . . . .88
19. ASSIGNMENT AND PARTICIPATION. . . . . . . . . . . . . . . . . . .89
19.1. Conditions to Assignment by Banks. . . . . . . . . . . . .89
19.2. Certain Representations and Warranties; Limitations;
Covenants . . . . . . . . . . . . . . . . . . . . . . . . .90
19.3. Register. . . . . . . . . . . . . . . . . . . . . . . . .91
19.4. New Notes. . . . . . . . . . . . . . . . . . . . . . . . .91
19.5. Participations. . . . . . . . . . . . . . . . . . . . . .92
19.6. Disclosure. . . . . . . . . . . . . . . . . . . . . . . .92
19.7. Assignee or Participant Affiliated with the Borrowers. . .92
19.8. Miscellaneous Assignment Provisions. . . . . . . . . . . .93
19.9. Assignment by Borrowers. . . . . . . . . . . . . . . . . .93
20. NOTICES, ETC. . . . . . . . . . . . . . . . . . . . . . . . . . .94
21. GOVERNING LAW. . . . . . . . . . . . . . . . . . . . . . . . . .94
22. HEADINGS. . . . . . . . . . . . . . . . . . . . . . . . . . . . .95
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23. COUNTERPARTS. . . . . . . . . . . . . . . . . . . . . . . . . . .95
24. ENTIRE AGREEMENT, ETC. . . . . . . . . . . . . . . . . . . . . .95
25. WAIVER OF JURY TRIAL. . . . . . . . . . . . . . . . . . . . . . .95
26. CONSENTS, AMENDMENTS, WAIVERS, ETC. . . . . . . . . . . . . . . .96
27. SEVERABILITY. . . . . . . . . . . . . . . . . . . . . . . . . . .96
EXHIBITS AND SCHEDULES
EXHIBITS
EXHIBIT A - Note
EXHIBIT B - Loan Request
EXHIBIT C - Compliance Certificate
EXHIBIT D - Assignment and Acceptance
SCHEDULES
SCHEDULE 1 - Banks; Commitments
SCHEDULE 7.3 - Title to Properties; Leases
SCHEDULE 7.7 - Litigation
SCHEDULE 7.18 - Environmental Matters
SCHEDULE 7.19 - Capitalization; Joint Ventures
SCHEDULE 7.20 - Bank Accounts
SCHEDULE 7.23 - Recapitalization Documents
SCHEDULE 9.1 - Existing Indebtedness
SCHEDULE 9.2 - Existing Liens
SCHEDULE 9.3 - Existing Investments
REVOLVING CREDIT AGREEMENT
This REVOLVING CREDIT AGREEMENT is made as of February 25, 1998, by and
among AMERICAN RESTAURANT GROUP, INC., a Delaware corporation ("ARG"), having
its principal place of business at 000 Xxxxxxx Xxxxxx Xxxxx, Xxxxxxx Xxxxx, XX
00000, LOCAL FAVORITE, INC., a California corporation ("LFI"), XXXXXX'X, INC., a
California corporation ("Grandy's"), ARG ENTERPRISES, INC., a California
corporation ("AEI"), ARG PROPERTY MANAGEMENT CORPORATION, a California
corporation ("APM"), SPOONS RESTAURANTS, INC., a Texas corporation ("Spoons"),
SPECTRUM FOODS, INC., a California corporation ("Spectrum") (each of ARG, LFI,
Grandy's, AEI, APM, Spoons, and Spectrum, individually a "Borrower" and
collectively, the "Borrowers"), BANKBOSTON, N.A., a national banking association
and the other lending institutions listed on SCHEDULE 1 and BANKBOSTON, N.A. as
agent for itself and such other lending institutions.
1. DEFINITIONS AND RULES OF INTERPRETATION.
1.1. DEFINITIONS. The following terms shall have the meanings set forth
in this Section 1 or elsewhere in the provisions of this Credit Agreement
referred to below:
ACCOUNTS RECEIVABLE. All rights of the Borrowers or any of their
Subsidiaries to payment for goods sold, leased or otherwise marketed in the
ordinary course of business and all rights of the Borrowers or any of their
Subsidiaries to payment for services rendered in the ordinary course of business
and all sums of money or other proceeds due thereon pursuant to transactions
with account debtors, except for that portion of the sum of money or other
proceeds due thereon that relate to sales, use or property taxes in conjunction
with such transactions, recorded on books of account in accordance with
generally accepted accounting principles.
AEI. As defined in the preamble hereto.
AFFILIATE. Any Person that would be considered to be an affiliate of any
of the Borrowers under Rule 144(a) of the Rules and Regulations of the
Securities and Exchange Commission, as in effect on the date hereof, if such
Borrower were issuing securities.
AGENCY ACCOUNT AGREEMENT. See Section 8.14.1.
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AGENT'S HEAD OFFICE. The Agent's head office located at 000 Xxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, or at such other location as the Agent may
designate from time to time.
AGENT. BankBoston, N.A. acting as agent for the Banks.
AGENT'S SPECIAL COUNSEL. Xxxxxxx Xxxx LLP or such other counsel as may
be approved by the Agent.
APM. As defined in the preamble hereto.
ASSIGNMENT AND ACCEPTANCE. See Section 19.1.
BALANCE SHEET DATE. December 30, 1996.
BANKS. BKB and the other lending institutions listed on SCHEDULE 1
hereto and any other Person who becomes an assignee of any rights and
obligations of a Bank pursuant to Section 19.
BASE RATE. The higher of (i) the annual rate of interest announced from
time to time by BKB at its head office in Boston, Massachusetts, as its "base
rate" and (ii) one-half of one percent (1/2%) above the Federal Funds Effective
Rate. For the purposes of this definition, "Federal Funds Effective Rate" shall
mean for any day, the 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, as published for such day (or, if such
day is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day that
is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three funds brokers of recognized
standing selected by the Agent.
BASE RATE LOANS. Loans bearing interest calculated by reference to the
Base Rate.
BKB. BankBoston, N.A. (f/k/a The First National Bank of Boston), a
national banking association, in its individual capacity.
BKB CONCENTRATION ACCOUNT. See Section 8.14.1.
BLACK ANGUS OF IDAHO. Black Angus Enterprises of Idaho, Inc., an Idaho
corporation.
BORROWERS. As defined in the preamble hereto.
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BUSINESS DAY. Any day on which banking institutions in Boston,
Massachusetts, are open for the transaction of banking business and, in the case
of Eurodollar Rate Loans, also a day which is a Eurodollar Business Day.
CAPITAL ASSETS. Fixed assets, both tangible (such as land, buildings,
fixtures, machinery and equipment) and intangible (such as patents, copyrights,
trademarks, franchises and good will); PROVIDED that Capital Assets shall not
include any item customarily charged directly to expense or depreciated over a
useful life of twelve (12) months or less in accordance with generally accepted
accounting principles.
CAPITAL EXPENDITURES. Amounts paid or Indebtedness incurred by any of
the Borrowers or any of their Subsidiaries in connection with (i) the purchase
or lease by any of the Borrowers or any of their Subsidiaries of Capital Assets
that would be required to be capitalized and shown on the balance sheet of such
Person in accordance with generally accepted accounting principles or (ii) the
lease of any assets by any of the Borrowers or any of their Subsidiaries as
lessee under any synthetic lease referred to in clause (vi) of the definition of
the term "Indebtedness" to the extent that such assets would have been Capital
Assets had the synthetic lease been treated for accounting purposes as a
Capitalized Lease.
CAPITALIZED LEASES. Leases under which any of the Borrowers or any of
their Subsidiaries is the lessee or obligor, the discounted future rental
payment obligations under which are required to be capitalized on the balance
sheet of the lessee or obligor in accordance with generally accepted accounting
principles.
CERCLA. See Section 7.18(a).
CLOSING DATE. The first date on which the conditions set forth in
Section 11 and Section 12 have been satisfied and any Loans are to be made or
any Letter of Credit is to be issued hereunder.
CODE. The Internal Revenue Code of 1986.
COLLATERAL. All of the property, rights and interests of the Borrowers
and their Subsidiaries that are or are intended to be subject to the security
interests and mortgages created by the Security Documents.
COLLATERAL AGENT. U.S. Trust of California, N.A. or a successor entity
satisfactory to the Agent.
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COMMITMENT. With respect to each Bank, the amount set forth on
SCHEDULE 1 hereto as the amount of such Bank's commitment to make Loans to, and
to participate in the issuance, extension and renewal of Letters of Credit for
the account of, the Borrowers, as the same may be reduced from time to time; or
if such commitment is terminated pursuant to the provisions hereof, zero.
COMMITMENT PERCENTAGE. With respect to each Bank, the percentage set
forth on SCHEDULE 1 hereto as such Bank's percentage of the aggregate
Commitments of all of the Banks.
COMPANY SECURITY AGREEMENT. The Company Security Agreement dated or to
be dated on or prior to the Closing Date, between ARG and the Collateral Agent
for the benefit of the Secured Parties and in form and substance satisfactory to
the Banks and the Agent.
CONSOLIDATED OR CONSOLIDATED. With reference to any term defined herein,
shall mean that term as applied to the accounts of the Borrowers and their
Subsidiaries, consolidated in accordance with generally accepted accounting
principles.
CONSOLIDATED CASH FLOW. For any period, an amount equal to (i) EBITDA
for such period LESS (ii) the sum of (A) cash payments for all taxes paid during
such period, PLUS (B) to the extent not already deducted in the determination of
EBITDA, Capital Expenditures made during such period.
CONSOLIDATED DEBT SERVICE. With respect to any period, an amount equal
to the sum of all payments on Indebtedness (including Consolidated Total
Interest Expense) that become due and payable or that are to become due and
payable during such fiscal period pursuant to any agreement or instrument to
which any of the Borrowers or any of their Subsidiaries is a party relating to
the borrowing of money or the obtaining of credit or in respect of any
Capitalized Lease, or of any synthetic lease referred to in clause (vi) of the
definition of the term "Indebtedness." Demand obligations shall be deemed to be
due and payable during any fiscal year during which such obligations are
outstanding.
CONSOLIDATED NET FUNDED DEBT. At any time of determination, the sum of
(i) the amount of the Loans outstanding (after giving account to any amounts
requested); PLUS (ii) the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations; PLUS (iii) the outstanding amount of any other Indebtedness for
borrowed money (including the Senior Notes), in respect of Capitalized Leases or
any synthetic lease referred to in clause (vi) of the definition of the term
"Indebtedness," or which is otherwise subject to the payment of interest; MINUS
(iv) unrestricted cash
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as reflected on the Borrowers' consolidated balance sheet at such time of
determination.
CONSOLIDATED TOTAL NET INTEREST EXPENSE. For any period, (a) the
aggregate amount of interest required to be paid or accrued by the Borrowers and
their Subsidiaries during such period on all Indebtedness of the Borrowers and
their Subsidiaries outstanding during all or any part of such period, whether
such interest was or is required to be reflected as an item of expense or
capitalized, including payments consisting of interest in respect of any
Capitalized Lease, or any synthetic lease referred to in clause (vi) of the
definition of the term "Indebtedness," and including commitment fees, agency
fees, facility fees, balance deficiency fees and similar fees or expenses in
connection with the borrowing of money, but excluding dividends (to the extent
permitted by this Credit Agreement) on the PIK Preferred Stock, LESS (b)
interest income on cash balances maintained by the Borrowers.
CONTINUING DIRECTORS. (i) Individuals who at the beginning of any period
were directors of ARG and (ii) any director whose election by the Board of
Directors of ARG or whose nomination for election by the stockholders of ARG was
approved by a majority of the Continuing Directors then still in office.
CONVERSION REQUEST. A notice given by the Borrowers to the Agent of the
Borrowers' election to convert or continue a Loan in accordance with Section
2.7.
CREDIT AGREEMENT. This Revolving Credit Agreement, including the
Schedules and Exhibits hereto.
DEFAULT. See Section 13.1.
DELINQUENT BANK. See Section 15.5.3.
DISTRIBUTION. The declaration or payment of any dividend on or in
respect of any shares of any class of capital stock of any of the Borrowers,
other than dividends payable solely in shares of common stock of any of the
Borrowers; the purchase, redemption, or other retirement of any shares of any
class of capital stock of any of the Borrowers, directly or indirectly through a
Subsidiary of such Borrower or otherwise; the return of capital by any of the
Borrowers to its shareholders as such; or any other distribution on or in
respect of any shares of any class of capital stock of any of the Borrowers.
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DOLLARS or $. Dollars in lawful currency of the United States of
America.
DOMESTIC LENDING OFFICE. Initially, the office of each Bank designated
as such in SCHEDULE 1 hereto; thereafter, such other office of such Bank, if
any, located within the United States that will be making or maintaining Base
Rate Loans.
DRAWDOWN DATE. The date on which any Loan is made or is to be made, and
the date on which any Loan is converted or continued in accordance with Section
2.7.
EBITDA. The consolidated earnings (or loss) from the operations of the
Borrowers and their Subsidiaries for any period, after all expenses and other
proper charges but before payment or provision for any income taxes, interest
expense, depreciation, amortization or any other non-cash charges or credits for
such period, determined in accordance with generally accepted accounting
principles.
ELIGIBLE ASSIGNEE. Any of (i) a commercial bank, finance company or
other financial institution organized under the laws of the United States, or
any State thereof or the District of Columbia, and having total assets in excess
of $1,000,000,000; (ii) a savings and loan association or savings bank organized
under the laws of the United States, or any State thereof or the District of
Columbia, and having a net worth of at least $100,000,000, calculated in
accordance with generally accepted accounting principles; (iii) a commercial
bank organized under the laws of any other country which is a member of the
Organization for Economic Cooperation and Development (the "OECD"), or a
political subdivision of any such country, and having total assets in excess of
$1,000,000,000, PROVIDED that such bank is acting through a branch or agency
located in the country in which it is organized or another country which is also
a member of the OECD; (iv) the central bank of any country which is a member of
the OECD; and (v) if, but only if, any Event of Default has occurred and is
continuing, any other bank, insurance company, commercial finance company or
other financial institution or other Person approved by the Agent, such approval
not to be unreasonably withheld.
EMPLOYEE BENEFIT PLAN. Any employee benefit plan within the meaning of
Section 3(3) of ERISA maintained or contributed to by any of the Borrowers or
any ERISA Affiliate, other than a Guaranteed Pension Plan or a Multiemployer
Plan.
ENVIRONMENTAL LAWS. See Section 7.18(a).
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EPA. See Section 7.18(b).
ERISA. The Employee Retirement Income Security Act of 1974.
ERISA AFFILIATE. Any Person which is treated as a single employer with
any of the Borrowers under Section 414 of the Code.
ERISA REPORTABLE EVENT. A reportable event with respect to a Guaranteed
Pension Plan within the meaning of Section 4043 of ERISA and the regulations
promulgated thereunder.
EUROCURRENCY RESERVE RATE. For any day with respect to a Eurodollar Rate
Loan, the maximum rate (expressed as a decimal) at which any lender subject
thereto would be required to maintain reserves under Regulation D of the Board
of Governors of the Federal Reserve System (or any successor or similar
regulations relating to such reserve requirements) against "Eurocurrency
Liabilities" (as that term is used in Regulation D), if such liabilities were
outstanding. The Eurocurrency Reserve Rate shall be adjusted automatically on
and as of the effective date of any change in the Eurocurrency Reserve Rate.
EURODOLLAR BUSINESS DAY. Any day on which commercial banks are open for
international business (including dealings in Dollar deposits) in London or such
other eurodollar interbank market as may be selected by the Agent in its sole
discretion acting in good faith.
EURODOLLAR LENDING OFFICE. Initially, the office of each Bank designated
as such in SCHEDULE 1 hereto; thereafter, such other office of such Bank, if
any, that shall be making or maintaining Eurodollar Rate Loans.
EURODOLLAR RATE. For any Interest Period with respect to a Eurodollar
Rate Loan, the rate of interest equal to (i) the arithmetic average of the rates
per annum for BKB (rounded upwards to the nearest 1/16 of one percent) of the
rate at which BKB's Eurodollar Lending Office is offered Dollar deposits two
Eurodollar Business Days prior to the beginning of such Interest Period in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations of such Eurodollar Lending Office are customarily conducted,
for delivery on the first day of such Interest Period for the number of days
comprised therein and in an amount comparable to the amount of the Eurodollar
Rate Loan of BKB to which such Interest Period applies, divided by (ii) a number
equal to 1.00 minus the Eurocurrency Reserve Rate, if applicable.
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EURODOLLAR RATE LOANS. Loans bearing interest calculated by reference to
the Eurodollar Rate.
EVENT OF DEFAULT. See Section 13.1.
FEE LETTER. The letter agreement regarding the closing fee and the
Agent's fee dated the date hereof among the Borrowers and the Agent.
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. (i) When used in Section 10,
whether directly or indirectly through reference to a capitalized term used
therein, means (A) principles that are consistent with the principles
promulgated or adopted by the Financial Accounting Standards Board and its
predecessors, in effect for the fiscal year ended on the Balance Sheet Date, and
(B) to the extent consistent with such principles, the accounting practice of
the Borrowers reflected in their financial statements for the year ended on the
Balance Sheet Date, and (ii) when used in general, other than as provided above,
means principles that are (A) consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time, and (B) consistently applied with past financial
statements of the Borrowers adopting the same principles, PROVIDED that in each
case referred to in this definition of "generally accepted accounting
principles", a certified public accountant would, insofar as the use of such
accounting principles is pertinent, be in a position to deliver an unqualified
opinion (other than a qualification regarding changes in generally accepted
accounting principles) as to financial statements in which such principles have
been properly applied.
GRANDY'S. As defined in the preamble hereto.
GUARANTEED PENSION PLAN. Any employee pension benefit plan within the
meaning of Section 3(2) of ERISA maintained or contributed to by any of the
Borrowers or any ERISA Affiliate the benefits of which are guaranteed on
termination in full or in part by the PBGC pursuant to Title IV of ERISA, other
than a Multiemployer Plan.
HAZARDOUS SUBSTANCES. See Section 7.18(b).
HOLDINGS. American Restaurant Group Holdings, Inc., a Delaware
corporation.
HOLDINGS DEBENTURES. The 14% Senior Discount Debentures due 2005 of
Holdings, as amended and in effect on the Closing Date.
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XXXXXXXX XXXXXXXXX. The Indenture dated as of December 1, 0000 xxxxxxx
Xxxxxxxx xxx Xxxxxx Xxxxxx Trust Company of New York, as Trustee, as amended by
the Second Supplemental Indenture dated as of February 25, 1998, as in effect on
the Closing Date.
HOLDINGS WARRANTS. The warrants to purchase common stock of Holdings
issued by Holdings in connection with the Subordinated Notes, which warrants are
to be canceled in connection with the repurchase of the Subordinated Notes
contemplated by the Recapitalization.
INDEBTEDNESS. As to any Person and whether recourse is secured by or is
otherwise available against all or only a portion of the assets of such Person
and whether or not contingent, but without duplication:
(i) every obligation of such Person for money borrowed,
(ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or
businesses,
(iii) every reimbursement obligation of such Person with respect
to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person,
(iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (including securities
repurchase agreements but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business which are not
overdue more than one hundred twenty (120) days or which are being
contested in good faith),
(v) every obligation of such Person under any Capitalized Lease,
(vi) every obligation of such Person under any lease (a
"synthetic lease") treated as an operating lease under generally accepted
accounting principles and as a loan or financing for U.S. income tax
purposes,
(vii) all sales by such Person of (A) accounts or general
intangibles for money due or to become due, (B) chattel paper,
instruments or documents creating or evidencing a right to payment of
money or (C) other receivables (collectively "receivables"), whether
pursuant to a purchase facility or otherwise, other than in
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connection with the disposition of the business operations of such Person
relating thereto or a disposition of defaulted receivables for collection
and not as a financing arrangement, and together with any obligation of
such Person to pay any discount, interest, fees, indemnities, penalties,
recourse, expenses or other amounts in connection therewith,
(viii) every obligation of such Person (an "equity related
purchase obligation") to purchase, redeem, retire or otherwise acquire
for value any shares of capital stock of any class issued by such Person,
any warrants, options or other rights to acquire any such shares, or any
rights measured by the value of such shares, warrants, options or other
rights,
(ix) every obligation of such Person under any forward contract,
futures contract, swap, option or other financing agreement or
arrangement (including, without limitation, caps, floors, collars and
similar agreements), the value of which is dependent upon interest rates,
currency exchange rates, commodities or other indices (a "derivative
contract"),
(x) every obligation in respect of Indebtedness of any other
entity (including any partnership in which such Person is a general
partner) to the extent that such Person is liable therefor as a result of
such Person's ownership interest in or other relationship with such
entity, except to the extent that the terms of such Indebtedness provide
that such Person is not liable therefor and such terms are enforceable
under applicable law,
(xi) every obligation, contingent or otherwise, of such Person
guaranteeing, or having the economic effect of guaranteeing or otherwise
acting as surety for, any obligation of a type described in any of
clauses (i) through (x) (the "primary obligation") of another Person (the
"primary obligor"), in any manner, whether directly or indirectly, and
including, without limitation, any obligation of such Person (A) to
purchase or pay (or advance or supply funds for the purchase of) any
security for the payment of such primary obligation, (B) to purchase
property, securities or services for the purpose of assuring the payment
of such primary obligation, or (C) to maintain working capital, equity
capital or other financial statement condition or liquidity of the
primary obligor so as to enable the primary obligor to pay such primary
obligation.
The "amount" or "principal amount" of any Indebtedness at any time of
determination represented by (u) any Indebtedness, issued at a
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price that is less than the principal amount at maturity thereof, shall be the
amount of the liability in respect thereof determined in accordance with
generally accepted accounting principles, (v) any Capitalized Lease shall be the
principal component of the aggregate of the rentals obligation under such
Capitalized Lease payable over the term thereof that is not subject to
termination by the lessee, (w) any sale of receivables shall be the amount of
unrecovered capital or principal investment of the purchaser (other than any of
the Borrowers or any of their wholly owned Subsidiaries) thereof, excluding
amounts representative of yield or interest earned on such investment, (x) any
synthetic lease shall be the stipulated loss value, termination value or other
equivalent amount, (y) any derivative contract shall be the maximum amount of
any termination or loss payment required to be paid by such Person if such
derivative contract were, at the time of determination, to be terminated by
reason of any event of default or early termination event thereunder, whether or
not such event of default or early termination event has in fact occurred and
(z) any equity-related purchase obligation shall be the maximum fixed redemption
or purchase price thereof inclusive of any accrued and unpaid dividends to be
comprised in such redemption or purchase price.
INDENTURE. The Indenture dated as of February 25, 1998 among the
Borrowers and the Trustee, as in effect on the Closing Date.
INELIGIBLE SECURITIES. Securities which may not be underwritten or dealt
in by member banks of the Federal Reserve System under Section 16 of the Banking
Act of 1993 (12 U.S.C. Section 24, Seventh), as amended.
INTERCREDITOR AGREEMENT. The Intercreditor and Collateral Agency
Agreement, dated or to be dated on or prior to the Closing Date, among the
Agent, the Trustee, the Collateral Agent and the Borrowers and in form and
substance satisfactory to the Banks and the Agent.
INTEREST PAYMENT DATE. (i) As to any Base Rate Loan, the first day of
each calendar month with respect to interest accrued during the immediately
preceding calendar month, including, without limitation, the calendar month
which includes the Drawdown Date of such Base Rate Loan; and (ii) as to any
Eurodollar Rate Loan, the last day of such Interest Period.
INTEREST PERIOD. With respect to each Loan, (i) initially, the period
commencing on the Drawdown Date of such Loan and ending on the last day of one
of the periods set forth below, as selected by the Borrowers in a Loan Request
or as otherwise required by the terms of this Credit Agreement (A) for any Base
Rate Loan, the last day of the calendar month and (B) for any Eurodollar Rate
Loan, 1, 2, or 3 months; and (ii)
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thereafter, each period commencing on the last day of the next preceding
Interest Period applicable to such Loan and ending on the last day of one of the
periods set forth above, as selected by the Borrowers in a Conversion Request;
PROVIDED that all of the foregoing provisions relating to Interest Periods are
subject to the following:
(a) if any Interest Period with respect to a Eurodollar Rate Loan
would otherwise end on a day that is not a Eurodollar Business Day, that
Interest Period shall be extended to the next succeeding Eurodollar
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 Eurodollar Business Day;
(b) if any Interest Period with respect to a Base Rate Loan would
end on a day that is not a Business Day, that Interest Period shall end
on the next succeeding Business Day;
(c) if the Borrowers shall fail to give notice as provided in
Section 2.7, the Borrowers shall be deemed to have requested a conversion
of the affected Eurodollar Rate Loan to a Base Rate Loan and the
continuance of all Base Rate Loans as Base Rate Loans on the last day of
the then current Interest Period with respect thereto;
(d) any Interest Period relating to any Eurodollar Rate Loan that
begins on the last Eurodollar 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
Eurodollar Business Day of a calendar month; and
(e) any Interest Period that would otherwise extend beyond the
Revolving Credit Loan Maturity Date shall end on the Revolving Credit
Loan Maturity Date.
INTERIM CONCENTRATION ACCOUNT. See Section 8.14.1.
INVESTMENTS. All expenditures made and all liabilities incurred
(contingently or otherwise) for the acquisition of stock or Indebtedness of, or
for loans, advances, capital contributions or transfers of property to, or in
respect of any guaranties (or other commitments as described under
Indebtedness), or obligations of, any Person. In determining the aggregate
amount of Investments outstanding at any particular time: (i) the amount of any
Investment represented by a guaranty shall be taken at not less than the
principal amount of the obligations guaranteed and still outstanding; (ii) there
shall be included as an Investment all interest
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accrued with respect to Indebtedness constituting an Investment unless and until
such interest is paid; (iii) there shall be deducted in respect of each such
Investment any amount received as a return of capital (but only by repurchase,
redemption, retirement, repayment, liquidating dividend or liquidating
distribution); (iv) there shall not be deducted in respect of any Investment any
amounts received as earnings on such Investment, whether as dividends, interest
or otherwise, except that accrued interest included as provided in the foregoing
clause (ii) may be deducted when paid; and (v) there shall not be deducted from
the aggregate amount of Investments any decrease in the value thereof.
LETTER OF CREDIT. See Section 4.1.1.
LETTER OF CREDIT APPLICATION. See Section 4.1.1.
LETTER OF CREDIT FEE. See Section 4.6.
LFI. As defined in the preamble hereto.
LETTER OF CREDIT PARTICIPATION. See Section 4.1.4.
LOAN DOCUMENTS. This Credit Agreement, the Notes, the Letter of Credit
Applications, the Letters of Credit, the Agent's Fee Letter, the Post Closing
Letter, the Intercreditor Agreement and the Security Documents.
LOAN REQUEST. See Section 2.6.
LOANS. Revolving credit loans made or to be made by the Bank to the
Borrowers pursuant to Section 2.
LOCAL ACCOUNT. See Section 8.14.1.
MAJORITY BANKS. As of any date, the Banks holding at least fifty-one
percent (51%) of the outstanding principal amount of the Notes on such date; and
if no such principal is outstanding, the Banks whose aggregate Commitments
constitutes at least fifty-one percent (51%) of the Total Commitment; PROVIDED,
HOWEVER, that at any time when there are only two Banks party to this Credit
Agreement, the term "Majority Banks" shall mean both such Banks.
MAXIMUM DRAWING AMOUNT. The maximum aggregate amount that the
beneficiaries may at any time draw under outstanding Letters of Credit, as such
aggregate amount may be reduced from time to time pursuant to the terms of the
Letters of Credit.
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MORTGAGED PROPERTY. Any Real Estate which is subject to any Mortgage.
MORTGAGES. The several mortgages and deeds of trust, dated or to be
dated on or prior to the Closing Date, from the Borrowers and their Subsidiaries
to the Collateral Agent for the benefit of the Secured Parties with respect to
the fee and leasehold interests of the Borrowers and their Subsidiaries in
certain Real Estate and in form and substance satisfactory to the Banks and the
Agent.
MULTIEMPLOYER PLAN. Any multiemployer plan within the meaning of Section
3(37) of ERISA maintained or contributed to by any of the Borrowers or any ERISA
Affiliate.
NOTES. See Section 2.4.
NOTEHOLDERS. The holders of the Senior Notes.
OBLIGATIONS. All indebtedness, obligations and liabilities of the
Borrowers and their Subsidiaries to any of the Banks and the Agent, individually
or collectively, existing on the date of this Credit Agreement or arising
thereafter, direct or indirect, joint or several, absolute or contingent,
matured or unmatured, liquidated or unliquidated, secured or unsecured, arising
by contract, operation of law or otherwise, arising or incurred under this
Credit Agreement or any of the other Loan Documents or in respect of any of the
Loans made or Reimbursement Obligations incurred or any of the Notes, Letter of
Credit Application, Letter of Credit or other instruments at any time evidencing
any thereof.
ORIGINAL SENIOR NOTES. ARG's Senior Secured Notes due 1998, to be
redeemed in their entirety as part of the Recapitalization.
OUTSTANDING. With respect to the Loans, the aggregate unpaid principal
thereof as of any date of determination.
PBGC. The Pension Benefit Guaranty Corporation created by Section 4002
of ERISA and any successor entity or entities having similar responsibilities.
PERMITTED LIENS. Liens, security interests and other encumbrances
permitted by Section 9.2.
PERSON. Any individual, corporation, partnership, trust, unincorporated
association, business, or other legal entity, and any government or any
governmental agency or political subdivision thereof.
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PIK PREFERRED STOCK. The 12% Senior Pay-in-Kind Exchangeable Preferred
Stock of ARG, as described in the Certificate of Incorporation of ARG, as in
effect on the Closing Date.
POST CLOSING LETTER. The letter regarding the post-closing obligations
of the Borrowers, dated as of the Closing Date, among the Borrowers and the
Agent and in form and substance satisfactory to the Agent.
RCRA. See Section 7.18(a).
REAL ESTATE. All real property at any time owned or leased (as lessee or
sublessee) by any of the Borrowers or any of their Subsidiaries.
RECAPITALIZATION. The issuance by ARG of the Senior Notes, the PIK
Preferred Stock and the Warrants, the redemption by ARG of the Original Senior
Notes, the repurchase by ARG of the Subordinated Notes, the cancellation of the
Holdings Warrants and the amendment of the Holdings Indenture in order to extend
the date for payment of the initial cash interest payment due thereunder.
RECAPITALIZATION DOCUMENTS. The Indenture, the Senior Notes, the PIK
Preferred Stock, the Warrants, the Holdings Indenture and the Holdings
Debentures.
RECORD. The grid attached to a Note, or the continuation of such grid,
or any other similar record, including computer records, maintained by any Bank
with respect to any Loan referred to in such Note.
REGISTER. See Section 19.3.
REIMBURSEMENT OBLIGATION. The Borrowers' obligations to reimburse the
Agent and the Banks on account of any drawing under any Letter of Credit as
provided in Section 4.2.
REVOLVING CREDIT LOAN MATURITY DATE. February 25, 2001.
XXXX. See Section 7.18(a).
SECTION 20 SUBSIDIARY. A Subsidiary of the bank holding company
controlling any Bank, which Subsidiary has been granted authority by the Federal
Reserve Board to underwrite and deal in certain Ineligible Securities.
SECURED PARTIES. The Agent and the Banks and the Trustee and the
Noteholders.
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SECURITY AGREEMENTS. The Company Security Agreement and the Subsidiary
Security Agreement.
SECURITY DOCUMENTS. The Security Agreements, the Mortgages, the
Trademark Agreement, the Stock Pledge Agreement, the Agency Account Agreements,
and all other instruments and documents, including without limitation Uniform
Commercial Code financing statements, required to be executed or delivered
pursuant to any Security Document.
SENIOR NOTES. The 11.5% Senior Secured Notes Due 2003 of ARG, each dated
February 25, 1998, as in effect on the Closing Date.
SPECTRUM. As defined in the preamble hereto.
SPOONS. As defined in the preamble hereto.
STOCK PLEDGE AGREEMENT. The Pledge Agreement, dated or to be dated on or
prior to the Closing Date, among the Borrowers and the Collateral Agent for the
benefit of the Secured Parties and in form and substance satisfactory to the
Banks and the Agent.
SUBORDINATED NOTES. The 10 1/4% Subordinated Notes of ARG, to be
repurchased in full as part of the Recapitalization.
SUBSIDIARY. Any corporation, association, trust, or other business
entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes) of the outstanding Voting Stock.
SUBSIDIARY SECURITY AGREEMENT. The Subsidiary Security Agreement, dated
or to be dated on or prior to the Closing Date, among the Borrowers other than
ARG and the Collateral Agent for the benefit of the Secured Parties and in form
and substance satisfactory to the Banks and the Agent.
SURVEY. In relation to each Mortgaged Property, an instrument survey of
such Mortgaged Property, which shall show the location of all buildings,
structures, easements and utility lines on such Mortgaged Property, shall be
sufficient to remove the survey exception from the Title Policy and obtain
current survey coverage under the Title Policy, shall show that all buildings
and structures are within the lot lines of such Mortgaged Property, shall not
show any encroachments by others, shall show the zoning district or districts in
which such Mortgaged Property is located in a flood hazard district as
established by the Federal Emergency Management Agency or any successor agency
or is located in any flood
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plain, flood hazard or wetland protection district established under federal,
state or local law.
SURVEYOR CERTIFICATE. If required by the Agent, in relation to each
Mortgaged Property for which a Survey has been conducted, a certificate executed
by the surveyor who prepared such Survey dated as of a recent date and
containing such information relating to such Mortgaged Property as the Agent or
the Title Insurance Company may require, such certificate to be satisfactory to
the Agent in form and substance.
TITLE INSURANCE COMPANY. First American Title Insurance Company.
TITLE POLICY. In relation to each Mortgaged Property, an ALTA standard
form title insurance policy issued by the Title Insurance Company (with such
reinsurance or co-insurance as the Agent may require, any such reinsurance to be
with direct access endorsements) in such amount as may be determined by the
Agent insuring the priority of the Mortgage of such Mortgaged Property and that
one of the Borrowers or one of their Subsidiaries holds marketable fee simple,
or as the case may be leasehold title to such Mortgaged Property, subject only
to the encumbrances permitted by such Mortgage and which shall not contain
exceptions for mechanics liens, persons in occupancy or matters which would be
shown by a survey (except as may be permitted by such Mortgage), shall not
insure over any matter except to the extent that any such affirmative insurance
is acceptable to the Agent in its sole discretion, and shall contain such
endorsements and affirmative insurance as the Agent in its discretion may
require, including but not limited to (i) comprehensive endorsement, (ii)
variable rate of interest endorsement, (iii) usury endorsement, (iv) revolving
credit endorsement, (v) tie-in endorsement, (vi) doing business endorsement and
(vii) a current survey endorsement.
TOTAL COMMITMENT. The sum of the Commitments of the Banks, as in effect
from time to time.
TRADEMARK AGREEMENT. The Trademark Collateral Security Agreement, dated
or to be dated on or prior to the Closing Date, made by the Borrowers and their
Subsidiaries in favor of the Collateral Agent for the benefit of the Secured
Parties and in form and substance satisfactory to the Banks and the Agent.
TRUSTEE. U.S. Trust Company of California, N.A., as trustee under the
Indenture.
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TYPE. As to any Loan, its nature as a Base Rate Loan or a Eurodollar
Rate Loan.
UNIFORM CUSTOMS. With respect to any Letter of Credit, the Uniform
Customs and Practice for Documentary Credits (1993 Revision), International
Chamber of Commerce Publication No. 500 or any successor version thereto adopted
by the Agent in the ordinary course of its business as a letter of credit issuer
and in effect at the time of issuance of such Letter of Credit.
UNPAID REIMBURSEMENT OBLIGATION. Any Reimbursement Obligation for which
the Borrowers do not reimburse the Agent and the Banks on the date specified in,
and in accordance with, Section 4.2.
VOTING STOCK. Stock or similar interests, of any class or classes
(however designated), the holders of which are at the time entitled, as such
holders, to vote for the election of a majority of the directors (or persons
performing similar functions) of the corporation, association, trust or other
business entity involved, whether or not the right so to vote exists by reason
of the happening of a contingency.
WARRANTS. The Common Stock Purchase Warrants of ARG dated February 25,
1998, as in effect on the Closing Date.
1.2. RULES OF INTERPRETATION.
(a) A reference to any document or agreement shall include such
document or agreement as amended, modified or supplemented from time to
time in accordance with its terms and the terms of this Credit Agreement.
(b) The singular includes the plural and the plural includes the
singular.
(c) A reference to any law includes any amendment or modification
to such law.
(d) A reference to any Person includes its permitted successors
and permitted assigns.
(e) Accounting terms not otherwise defined herein have the
meanings assigned to them by generally accepted accounting principles
applied on a consistent basis by the accounting entity to which they
refer.
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(f) The words "include", "includes" and "including" are not
limiting.
(g) All terms not specifically defined herein or by generally
accepted accounting principles, which terms are defined in the Uniform
Commercial Code as in effect in the Commonwealth of Massachusetts, have
the meanings assigned to them therein, with the term "instrument" being
that defined under Article 9 of the Uniform Commercial Code.
(h) Reference to a particular "Section " refers to that section
of this Credit Agreement unless otherwise indicated.
(i) The words "herein", "hereof", "hereunder" and words of like
import shall refer to this Credit Agreement as a whole and not to any
particular section or subdivision of this Credit Agreement.
(j) Unless otherwise expressly indicated, in the computation of
periods of time from a specified date to a later specified date, the word
"from" means "from and including," the words "to" and "until" each mean
"to but excluding," and the word "through" means "to and including."
(k) This Credit Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the same
or similar matters. All such limitations, tests and measurements are,
however, cumulative and are to be performed in accordance with the terms
thereof.
(l) This Credit Agreement and the other Loan Documents are the
result of negotiation among, and have been reviewed by counsel to, among
others, the Agent and the Borrowers and are the product of discussions
and negotiations among all parties. Accordingly, this Credit Agreement
and the other Loan Documents are not intended to be construed against the
Agent or any of the Banks merely on account of the Agent's or any Bank's
involvement in the preparation of such documents.
2. THE REVOLVING CREDIT FACILITY.
2.1. COMMITMENT TO LEND. Subject to the terms and conditions set forth
in this Credit Agreement, each of the Banks severally agrees to lend to the
Borrowers and the Borrowers may borrow, repay, and reborrow from time to time
from the Closing Date up to but not including the Revolving Credit Loan Maturity
Date upon notice by the Borrowers to the
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Agent given in accordance with Section 2.6, such sums as are requested by the
Borrowers up to a maximum aggregate amount outstanding (after giving effect to
all amounts requested) at any one time equal to such Bank's Commitment MINUS
such Bank's Commitment Percentage of the sum of the Maximum Drawing Amount and
all Unpaid Reimbursement Obligations, PROVIDED that the sum of the outstanding
amount of the Loans (after giving effect to all amounts requested) PLUS the
Maximum Drawing Amount and all Unpaid Reimbursement Obligations shall not at any
time exceed the Total Commitment. The Loans shall be made PRO RATA in accordance
with each Bank's Commitment Percentage. Each request for a Loan hereunder shall
constitute a representation and warranty by the Borrowers that the conditions
set forth in Section 11 and Section 12, in the case of the initial Loans to be
made on the Closing Date, and Section 12, in the case of all other Loans, have
been satisfied on the date of such request.
2.2. COMMITMENT FEE. The Borrowers jointly and severally agree to pay
to the Agent for the accounts of the Banks in accordance with their respective
Commitment Percentages a commitment fee calculated at the rate of one-half of
one percent (0.50%) per annum on the average daily amount during each calendar
quarter or portion thereof from the date hereof to the Revolving Credit Loan
Maturity Date by which the Total Commitment MINUS the sum of the Maximum Drawing
Amount and all Unpaid Reimbursement Obligations exceeds the outstanding amount
of Loans during such calendar quarter. The commitment fee shall be payable
quarterly in arrears on the first day of each calendar quarter for the
immediately preceding calendar quarter commencing on the first such date
following the date hereof, with a final payment on the Revolving Credit Loan
Maturity Date or any earlier date on which the Commitments shall terminate.
2.3. REDUCTION OF TOTAL COMMITMENT. The Borrowers shall have the right
at any time and from time to time upon five (5) Business Days prior written
notice to the Agent to reduce by $500,000 or an integral multiple thereof or
terminate entirely the Total Commitment, whereupon the Commitments of the Banks
shall be reduced PRO RATA in accordance with their respective Commitment
Percentages of the amount specified in such notice or, as the case may be,
terminated. Promptly after receiving any notice of the Borrowers delivered
pursuant to this Section 2.3, the Agent will notify the Banks of the substance
thereof. Upon the effective date of any such reduction or termination, the
Borrowers shall pay to the Agent for the respective accounts of the Banks the
full amount of any commitment fee then accrued on the amount of the reduction.
No reduction or termination of the Commitments may be reinstated.
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2.4. THE NOTES. The Loans shall be evidenced by separate promissory
notes of the Borrowers in substantially the form of EXHIBIT A hereto (each a
"Note"), dated as of the Closing Date and completed with appropriate insertions.
One Note shall be payable to the order of each Bank in a principal amount equal
to such Bank's Commitment or, if less, the outstanding amount of all Loans made
by such Bank, plus interest accrued thereon, as set forth below. The Borrowers
irrevocably authorize each Bank to make or cause to be made, at or about the
time of the Drawdown Date of any Loan or at the time of receipt of any payment
of principal on such Bank's Note, an appropriate notation on such Bank's Record
reflecting the making of such Loan or (as the case may be) the receipt of such
payment. The outstanding amount of the Loans set forth on such Bank's Record
shall be PRIMA FACIE evidence of the principal amount thereof owing and unpaid
to such Bank, but the failure to record, or any error in so recording, any such
amount on such Bank's Record shall not limit or otherwise affect the obligations
of the Borrowers hereunder or under any Note to make payments of principal of or
interest on any Note when due.
2.5. INTEREST ON LOANS. Except as otherwise provided in Section 5.11,
(a) Each Base Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at the rate of one percent
(1.0%) per annum above the Base Rate.
(b) Each Eurodollar Rate Loan shall bear interest for the period
commencing with the Drawdown Date thereof and ending on the last day of
the Interest Period with respect thereto at the rate of two and one-half
percent (2.5%) per annum above the Eurodollar Rate determined for such
Interest Period.
(c) The Borrowers jointly and severally promise to pay interest
on each Loan in arrears on each Interest Payment Date with respect
thereto.
(d) There shall be no more than eight (8) Eurodollar Loans
outstanding at any time.
2.6. REQUESTS FOR LOANS. The Borrowers shall give to the Agent written
notice in the form of EXHIBIT B hereto (or telephonic notice confirmed in a
writing in the form of EXHIBIT B hereto) of each Loan requested hereunder (a
"Loan Request") (i) by 12:00 p.m. on the proposed Drawdown Date of any Base Rate
Loan and (ii) three (3) Eurodollar Business Days prior to the proposed Drawdown
Date of any Eurodollar
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Rate Loan. Each such notice shall specify (A) the principal amount of the Loan
requested, (B) the proposed Drawdown Date of such Loan, (C) the Interest Period
for such Loan and (D) the Type of such Loan. Promptly upon receipt of any such
notice, the Agent shall notify each of the Banks thereof. Each Loan Request
shall be irrevocable and binding on the Borrowers and shall obligate the
Borrowers to accept the Loan requested from the Banks on the proposed Drawdown
Date. Each Loan Request shall be in a minimum aggregate amount of $500,000 or an
integral multiple thereof.
2.7. CONVERSION OPTIONS.
2.7.1. CONVERSION TO DIFFERENT TYPE OF LOAN. The Borrowers may
elect from time to time to convert any outstanding Loan to a Loan of
another Type, PROVIDED that (i) with respect to any such conversion of a
Loan to a Base Rate Loan, the Borrowers shall give the Agent written
notice of such election by 12:00 p.m. on the date of such conversion;
(ii) with respect to any such conversion of a Base Rate Loan to a
Eurodollar Rate Loan, the Borrowers shall give the Agent at least three
(3) Eurodollar Business Days' prior written notice of such election;
(iii) with respect to any such conversion of a Eurodollar Rate Loan into
a Loan of another Type, such conversion shall only be made on the last
day of the Interest Period with respect thereto and (iv) no Loan may be
converted into a Eurodollar Rate Loan when any Default or Event of
Default has occurred and is continuing. On the date on which such
conversion is being made, each Bank shall take such action as is
necessary to transfer its Commitment Percentage of such Loans to its
Domestic Lending Office or its Eurodollar Lending Office, as the case may
be. All or any part of the outstanding Loans of any Type may be
converted into a Loan of another Type as provided herein, PROVIDED that
any partial conversion shall be in an aggregate principal amount of
$500,000 or a whole multiple thereof. Each Conversion Request relating
to the conversion of a Loan to a Eurodollar Rate Loan shall be
irrevocable by the Borrowers.
2.7.2. CONTINUATION OF TYPE OF LOAN. Any Loan of any Type may be
continued as a Loan of the same Type upon the expiration of an Interest
Period with respect thereto by compliance by the Borrowers with the
notice provisions contained in Section 2.7.1; PROVIDED that no Eurodollar
Rate Loan may be continued as such when any Default or Event of Default
has occurred and is continuing, but shall be automatically converted to a
Base Rate Loan on the last day of the first Interest Period relating
thereto ending during the
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continuance of any Default or Event of Default of which officers of the
Agent active upon the Borrowers' account have actual knowledge; and
PROVIDED FURTHER that no notice shall be required in order to continue a
Base Rate Loan as a Base Rate Loan. In the event that the Borrowers fail
to provide any such notice with respect to the continuation of any
Eurodollar Rate Loan as such, then such Eurodollar Rate Loan shall be
automatically converted to a Base Rate Loan on the last day of the first
Interest Period relating thereto. The Agent shall notify the Banks
promptly when any such automatic conversion contemplated by this Section
2.7 is scheduled to occur.
2.7.3. EURODOLLAR RATE LOANS. Any conversion to or from
Eurodollar Rate Loans shall be in such amounts and be made pursuant to
such elections so that, after giving effect thereto, the aggregate
principal amount of all Eurodollar Rate Loans having the same Interest
Period shall not be less than $500,000 or a whole multiple in excess
thereof.
2.8. FUNDS FOR LOANS.
2.8.1. FUNDING PROCEDURES. Not later than 1:00 p.m. (Boston
time) on the proposed Drawdown Date of any Loans, each of the Banks will
make available to the Agent, at the Agent's Head Office, in immediately
available funds, the amount of such Bank's Commitment Percentage of the
amount of the requested Loans. Upon receipt from each Bank of such
amount, and upon receipt of the documents required by Sections 11 and 12
and the satisfaction of the other conditions set forth therein, to the
extent applicable, the Agent will make available to the Borrowers the
aggregate amount of such Loans made available to the Agent by the Banks.
The failure or refusal of any Bank to make available to the Agent at the
aforesaid time and place on any Drawdown Date the amount of its
Commitment Percentage of the requested Loans shall not relieve any other
Bank from its several obligation hereunder to make available to the Agent
the amount of such other Bank's Commitment Percentage of any requested
Loans.
2.8.2. ADVANCES BY AGENT. The Agent may, unless notified to the
contrary by any Bank prior to a Drawdown Date, assume that such Bank has
made available to the Agent on such Drawdown Date the amount of such
Bank's Commitment Percentage of the Loans to be made on such Drawdown
Date, and the Agent may (but it shall not be required to), in reliance
upon such assumption, make
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available to the Borrowers a corresponding amount. If any Bank makes
available to the Agent such amount on a date after such Drawdown Date,
such Bank shall pay to the Agent on demand an amount equal to the product
of (i) the average computed for the period referred to in clause (iii)
below, of the weighted average interest rate paid by the Agent for
federal funds acquired by the Agent during each day included in such
period, TIMES (ii) the amount of such Bank's Commitment Percentage of
such Loans, TIMES (iii) a fraction, the numerator of which is the number
of days that elapse from and including such Drawdown Date to the date on
which the amount of such Bank's Commitment Percentage of such Loans shall
become immediately available to the Agent, and the denominator of which
is 365. A statement of the Agent submitted to such Bank with respect to
any amounts owing under this paragraph shall be PRIMA FACIE evidence of
the amount due and owing to the Agent by such Bank. If the amount of such
Bank's Commitment Percentage of such Loans is not made available to the
Agent by such Bank within three (3) Business Days following such Drawdown
Date, the Agent shall be entitled to recover such amount from the
Borrowers on demand, with interest thereon at the rate per annum
applicable to the Loans made on such Drawdown Date.
2.9. APPLICATION OF AMOUNTS IN BKB CONCENTRATION ACCOUNT.
2.9.1. APPLICATION OF PAYMENTS.
(a) All funds transferred to the BKB Concentration Account
and for which the Borrowers have received credits shall be applied
to the Obligations as follows:
(i) first, to pay amounts then due and payable
under this Agreement, the Notes and the other Loan
Documents;
(ii) second, to reduce Loans which are Base Rate
Loans;
(iii) third, to reduce Loans which are Eurodollar
Rate Loans;
(iv) fourth, to cash collateralize Letters of
Credit in accordance with Section 4.2(b) and (c); and
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(v) fifth, to the Collateral Agent as required by
the Intercreditor Agreement or, if not so required, to the
Borrowers.
The Agent agrees that, prior to the occurrence of a Default or an
Event of Default hereunder, the Agent shall not give notice to any
lending institution party to an Agency Account Agreement requiring
it to send funds to the BKB Concentration Account.
(b) All prepayments of Eurodollar Rate Loans prior to the
end of an Interest Period shall obligate the Borrowers to pay any
breakage costs associated with such Eurodollar Rate Loans in
accordance with Section 5.10. Prior to the occurrence of an Event
of Default, the Borrowers may elect to avoid such breakage costs
by providing to the Agent cash in an amount sufficient to cash
collateralize such Eurodollar Rate Loans, but in no event shall
the Borrowers be deemed to have paid such Eurodollar Rate Loans
until such cash has been paid to the Agent for application to such
Eurodollar Rate Loans. The Agent may elect to cause such cash
collateral to be deposited into either (i) a cash collateral
account pursuant to the terms of a cash collateral agreement
executed by the Borrowers and the Agent and in form and substance
satisfactory to the Agent or (ii) an operating account with the
Agent with appropriate instructions prohibiting the Borrowers'
withdrawal of such funds so long as they remain cash collateral.
In each such case, the Borrowers agree to execute and deliver to
the Agent such instruments and documents, including Uniform
Commercial Code financing statements and agreements with any third
party depository banks, as the Agent may request.
(c) All prepayments of the Loans pursuant to this Section
2.9.1 shall be allocated among the Banks making such Loans, in
proportion, as nearly as practicable, to the respective unpaid
principal amount of such Loans outstanding, with adjustments to
the extent practicable to equalize any prior payments or
repayments not exactly in proportion.
2.9.2. REPAYMENTS OF LOANS AFTER EVENT OF DEFAULT. Following the
occurrence and during the continuance of an Event of Default of which the
account officers of the Agent active on the Borrowers' account have
knowledge (and regardless of whether such Default or
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Event of Default has been cured or waived), all funds transferred to the
BKB Concentration Account and for which the Borrowers have received
credits shall be applied to the Obligations in accordance with Section
13.4.
3. REPAYMENT OF THE LOANS.
3.1. MATURITY. The Borrowers jointly and severally promise to pay on
the Revolving Credit Loan Maturity Date, and there shall become absolutely due
and payable on the Revolving Credit Loan Maturity Date, all of the Loans
outstanding on such date, together with any and all accrued and unpaid interest
thereon.
3.2. MANDATORY REPAYMENTS OF LOANS. If at any time the sum of the
outstanding amount of the Loans, the Maximum Drawing Amount and all Unpaid
Reimbursement Obligations exceeds the Total Commitment, then the Borrowers shall
immediately pay the amount of such excess to the Agent for the respective
accounts of the Banks for application: first, to any Unpaid Reimbursement
Obligations; second, to the Loans; and third, to provide to the Agent cash
collateral for Reimbursement Obligations as contemplated by Section 4.2(b) and
(c). Each payment of any Unpaid Reimbursement Obligations or prepayment of
Loans shall be allocated among the Banks, in proportion, as nearly as
practicable, to each Reimbursement Obligation or (as the case may be) the
respective unpaid principal amount of each Bank's Note, with adjustments to the
extent practicable to equalize any prior payments or repayments not exactly in
proportion.
3.3. OPTIONAL REPAYMENTS OF LOANS. The Borrowers shall have the right,
at their election, to repay the outstanding amount of the Loans, as a whole or
in part, at any time without penalty or premium, PROVIDED that any full or
partial prepayment of the outstanding amount of any Eurodollar Rate Loans
pursuant to this Section 3.3 prior to the end of the Interest Period relating
thereto shall obligate the Borrowers to pay any breakage costs associated with
such Eurodollar Rate Loan in accordance with Section 5.10. The Borrowers shall
give the Agent (i) no later than 12:00 p.m., Boston time, on the date of any
proposed prepayment pursuant to this Section 3.3 of Base Rate Loans, written
notice thereof, and (ii) three (3) Eurodollar Business Days' prior written
notice of any proposed prepayment pursuant to this Section 3.3 of Eurodollar
Rate Loans, in each case specifying the proposed date of prepayment of Loans and
the principal amount to be prepaid. Each such partial prepayment of the Loans
shall be in an integral multiple of $500,000, shall, at the option of the Agent,
be accompanied by the payment of accrued interest on the principal prepaid
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to the date of prepayment and shall be applied, in the absence of instruction by
the Borrowers, first to the principal of Base Rate Loans and then to the
principal of Eurodollar Rate Loans. Each partial prepayment shall be allocated
among the Banks, in proportion, as nearly as practicable, to the respective
unpaid principal amount of each Bank's Note, with adjustments to the extent
practicable to equalize any prior repayments not exactly in proportion.
4. LETTERS OF CREDIT.
4.1. LETTER OF CREDIT COMMITMENTS.
4.1.1. COMMITMENT TO ISSUE LETTERS OF CREDIT. Subject to the
terms and conditions hereof and the execution and delivery by the
Borrowers of a letter of credit application on the Agent's customary form
(a "Letter of Credit Application"), the Agent on behalf of the Banks and
in reliance upon the agreement of the Banks set forth in Section 4.1.4
and upon the representations and warranties of the Borrowers contained
herein, agrees, in its individual capacity, to issue, extend and renew
for the account of the Borrowers one or more standby letters of credit
(individually, a "Letter of Credit"), in such form as may be requested
from time to time by the Borrowers and agreed to by the Agent; PROVIDED,
HOWEVER, that, after giving effect to such request, (a) the sum of the
aggregate Maximum Drawing Amount and all Unpaid Reimbursement Obligations
shall not exceed $10,000,000 at any one time and (b) the sum of (i) the
Maximum Drawing Amount on all Letters of Credit, (ii) all Unpaid
Reimbursement Obligations, and (iii) the amount of all Loans outstanding
shall not exceed the Total Commitment.
4.1.2. LETTER OF CREDIT APPLICATIONS. Each Letter of Credit
Application shall be completed to the satisfaction of the Agent. In the
event that any provision of any Letter of Credit Application shall be
inconsistent with any provision of this Credit Agreement, then the
provisions of this Credit Agreement shall, to the extent of any such
inconsistency, govern.
4.1.3. TERMS OF LETTERS OF CREDIT. Each Letter of Credit issued,
extended or renewed hereunder shall, among other things, (i) provide for
the payment of sight drafts for honor thereunder when presented in
accordance with the terms thereof and when accompanied by the documents
described therein, and (ii) have an expiry date no later than the date
which is fourteen (14) days (or, if the Letter of Credit is confirmed by
a confirmer or otherwise
-28-
provides for one or more nominated persons, forty-five (45) days) prior
to the Revolving Credit Loan Maturity Date. Each Letter of Credit so
issued, extended or renewed shall be subject to the Uniform Customs.
4.1.4. REIMBURSEMENT OBLIGATIONS OF BANKS. Each Bank severally
agrees that it shall be absolutely liable, without regard to the
occurrence of any Default or Event of Default or any other condition
precedent whatsoever, to the extent of such Bank's Commitment Percentage,
to reimburse the Agent on demand for the amount of each draft paid by the
Agent under each Letter of Credit to the extent that such amount is not
reimbursed by the Borrowers pursuant to Section 4.2 (such agreement for a
Bank being called herein the "Letter of Credit Participation" of such
Bank).
4.1.5. PARTICIPATIONS OF BANKS. Each such payment made by a Bank
shall be treated as the purchase by such Bank of a participating interest
in the Borrowers' Reimbursement Obligation under Section 4.2 in an amount
equal to such payment. Each Bank shall share in accordance with its
participating interest in any interest which accrues pursuant to Section
4.2.
4.2. REIMBURSEMENT OBLIGATION OF THE BORROWERS. In order to induce the
Agent to issue, extend and renew each Letter of Credit and the Banks to
participate therein, the Borrowers hereby agree to reimburse or pay to the
Agent, for the account of the Agent or (as the case may be) the Banks, with
respect to each Letter of Credit issued, extended or renewed by the Agent
hereunder,
(a) except as otherwise expressly provided in Section 4.2(b) and
(c), on each date that any draft presented under such Letter of Credit is
honored by the Agent, or the Agent otherwise makes a payment with respect
thereto, (i) the amount paid by the Agent under or with respect to such
Letter of Credit, and (ii) the amount of any taxes, fees, charges or
other costs and expenses whatsoever incurred by the Agent or any Bank in
connection with any payment made by the Agent or any Bank under, or with
respect to, such Letter of Credit; PROVIDED, HOWEVER, that if such
reimbursement or payment is not otherwise made by the Borrowers within
one (1) Business Day following the honoring of any draft hereunder by the
Agent, subject to the Borrowers' compliance with the conditions precedent
set forth in Section 11 (to the extent applicable) and Section 12 hereof
and in the event that the sum of such amount PLUS the maximum aggregate
principal amount of the Loans outstanding (after giving effect to all
amounts
-29-
requested) PLUS the Maximum Drawing Amount and all Unpaid Reimbursement
Obligations does not exceed the Total Commitment, the aggregate amount
payable by the Borrowers pursuant to clauses (i) and (ii) above shall be
deemed, for all purposes of this Credit Agreement, a Base Rate Loan made
by the Banks to the Borrowers on the date that the Agent honored the
relevant draft,
(b) upon the reduction (but not termination) of the Total
Commitment to an amount less than the Maximum Drawing Amount, an amount
equal to such difference, which amount shall be held by the Agent for the
benefit of the Banks and the Agent as cash collateral for all
Reimbursement Obligations, and
(c) upon the termination of the Total Commitment, or the
acceleration of the Reimbursement Obligations with respect to all Letters
of Credit in accordance with Section 13, an amount equal to the then
Maximum Drawing Amount on all Letters of Credit, which amount shall be
held by the Agent for the benefit of the Banks and the Agent as cash
collateral for all Reimbursement Obligations.
Unless funded by a Base Rate Loan pursuant to Section 4.2(a) hereof, each such
payment shall be made to the Agent at the Agent's Head Office in immediately
available funds. Interest on any and all amounts remaining unpaid by the
Borrowers under this Section 4.2 at any time from the date such amounts become
due and payable (whether as stated in this Section 4.2, by acceleration or
otherwise) until payment in full (whether before or after judgment) shall be
payable to the Agent on demand at the rate specified in Section 5.11 for overdue
principal on the Loans.
4.3. LETTER OF CREDIT PAYMENTS. If any draft shall be presented or
other demand for payment shall be made under any Letter of Credit, the Agent
shall notify the Borrowers of the date and amount of the draft presented or
demand for payment and of the date and time when it expects to pay such draft or
honor such demand for payment. If the Borrowers fail to reimburse the Agent as
provided in Section 4.2 on or before the date that such draft is paid or other
payment is made by the Agent, the Agent may at any time thereafter notify the
Banks of the amount of any such Unpaid Reimbursement Obligation. No later than
3:00 p.m. (Boston time) on the Business Day next following the receipt of such
notice, each Bank shall make available to the Agent, at the Agent's Head Office,
in immediately available funds, such Bank's Commitment Percentage of such Unpaid
Reimbursement Obligation, together with an amount equal to the product of (i)
the average, computed for the period referred to in clause (iii) below, of the
weighted average interest rate paid by the Agent for
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federal funds acquired by the Agent during each day included in such period,
TIMES (ii) the amount equal to such Bank's Commitment Percentage of such Unpaid
Reimbursement Obligation, TIMES (iii) a fraction, the numerator of which is the
number of days that elapse from and including the date the Agent paid the draft
presented for honor or otherwise made payment to the date on which such Bank's
Commitment Percentage of such Unpaid Reimbursement obligation shall become
immediately available to the Agent, and the denominator of which is 360. The
responsibility of the Agent to the Borrowers and the Banks shall be only to
determine that the documents (including each draft) delivered under each Letter
of Credit in connection with such presentment shall be in conformity in all
material respects with such Letter of Credit.
4.4. OBLIGATIONS ABSOLUTE. The Borrowers' obligations under this
Section 4 shall be absolute and unconditional under any and all circumstances
and irrespective of the occurrence of any Default or Event of Default or any
condition precedent whatsoever or any setoff, counterclaim or defense to payment
which the Borrowers may have or have had against the Agent, any Bank or any
beneficiary of a Letter of Credit. The Borrowers further agree with the Agent
and the Banks that the Agent and the Banks shall not be responsible for, and
the Borrowers' Reimbursement Obligations under Section 4.2 shall not be affected
by, among other things, the validity or genuineness of documents or of any
endorsements thereon, even if such documents should in fact prove to be in any
or all respects invalid, fraudulent or forged, or any dispute between or among
the Borrowers, the beneficiary of any Letter of Credit or any financing
institution or other party to which any Letter of Credit may be transferred or
any claims or defenses whatsoever of the Borrowers against the beneficiary of
any Letter of Credit or any such transferee. The Agent and the Banks shall not
be liable for any error, omission, interruption or delay in transmission,
dispatch or delivery of any message or advice, however transmitted, in
connection with any Letter of Credit. The Borrowers agree that any action taken
or omitted by the Agent or any Bank under or in connection with each Letter of
Credit and the related drafts and documents, if done in good faith, shall be
binding upon the Borrowers and shall not result in any liability on the part of
the Agent or any Bank to the Borrowers.
4.5. RELIANCE BY ISSUER. To the extent not inconsistent with Section
4.4, the Agent shall be entitled to rely, and shall be fully protected in
relying upon, any Letter of Credit, draft, writing, resolution, notice, consent,
certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype
message, statement, order or other document believed by it to be genuine and
correct and to have been signed, sent or made by the proper
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Person or Persons and upon advice and statements of legal counsel, independent
accountants and other experts selected by the Agent. The Agent shall be fully
justified in failing or refusing to take any action under this Credit Agreement
unless it shall first have received such advice or concurrence of the Majority
Banks as it reasonably deems appropriate or it shall first be indemnified to its
reasonable satisfaction by the Banks against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take any such
action. The Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Credit Agreement in accordance with a request
of the Majority Banks, and such request and any action taken or failure to act
pursuant thereto shall be binding upon the Banks and all future holders of the
Revolving Credit Notes or of a Letter of Credit Participation.
4.6. LETTER OF CREDIT FEE. The Borrowers shall, on the date of issuance
or any extension or renewal of any Letter of Credit pay a fee (in each case, a
"Letter of Credit Fee") to the Agent in respect of each standby Letter of Credit
an amount equal to two and one-half percent (2.5%) per annum of the face amount
of such standby Letter of Credit, of which an amount equal to one-eighth of one
percent (0.125%) per annum of the face amount of such standby Letter of Credit
shall be for the account of the Agent, as a fronting fee, and the balance of
which Letter of Credit Fee shall be for the accounts of the Banks in accordance
with their respective Commitment Percentages. In respect of each Letter of
Credit, the Borrowers shall also pay to the Agent for the Agent's own account,
at such other time or times as such charges are customarily made by the Agent,
the Agent's customary issuance, amendment, negotiation or document examination
and other administrative fees as in effect from time to time.
5. CERTAIN GENERAL PROVISIONS.
5.1. CLOSING FEE. The Borrowers jointly and severally agree to pay to
the Agent a closing fee in accordance with the terms of the Fee Letter.
5.2. AGENT'S FEE. The Borrowers jointly and severally agree to pay to
the Agent annually in advance, for the Agent's own account, on the first date on
which BKB is not the sole Bank hereunder and on each anniversary of such date,
an Agent's fee in the amount set forth and on the terms and conditions set forth
in the Fee Letter
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5.3. FUNDS FOR PAYMENTS.
5.3.1. PAYMENTS TO AGENT. All payments of principal, interest,
Reimbursement Obligations, commitment fees, Letter of Credit Fees and any
other amounts due hereunder or under any of the other Loan Documents
shall be made to the Agent, for the respective accounts of the Banks and
the Agent, at the Agent's Head Office or at such other location in the
Boston, Massachusetts, area that the Agent may from time to time
designate, in each case in immediately available funds.
5.3.2. NO OFFSET, ETC. All payments by the Borrowers hereunder
and under any of the other Loan Documents shall be made without setoff or
counterclaim and free and clear of and without deduction for any taxes,
levies, imposts, duties, charges, fees, deductions, withholdings,
compulsory loans, restrictions or conditions of any nature now or
hereafter imposed or levied by any jurisdiction or any political
subdivision thereof or taxing or other authority therein unless the
Borrowers are compelled by law to make such deduction or withholding. If
any such obligation is imposed upon the Borrowers with respect to any
amount payable by them hereunder or under any of the other Loan
Documents, the Borrowers will pay to the Agent, for the account of the
Banks or (as the case may be) the Agent, on the date on which such amount
is due and payable hereunder or under such other Loan Document, such
additional amount in Dollars as shall be necessary to enable the Banks or
the Agent to receive the same net amount which the Banks or the Agent
would have received on such due date had no such obligation been imposed
upon the Borrowers. The Borrowers will deliver promptly to the Agent
certificates or other valid vouchers for all taxes or other charges
deducted from or paid with respect to payments made by the Borrowers
hereunder or under such other Loan Document.
5.4. COMPUTATIONS. All computations of interest on the Loans and of
commitment fees, Letter of Credit Fees or other fees shall be based on a 360-day
year and paid for the actual number of days elapsed. Except as otherwise
provided in the definition of the term "Interest Period" with respect to
Eurodollar Rate Loans, whenever a payment hereunder or under any of the other
Loan Documents becomes due on a day that is not a Business Day, the due date for
such payment shall be extended to the next succeeding Business Day, and interest
shall accrue during such extension. The outstanding amount of the Loans as
reflected on the Records from time to time shall be considered correct and
binding on the
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Borrowers unless within five (5) Business Days after receipt of any notice by
the Agent or any of the Banks of such outstanding amount, the Agent or such Bank
shall notify the Borrowers to the contrary.
5.5. INABILITY TO DETERMINE EURODOLLAR RATE. In the event, prior to the
commencement of any Interest Period relating to any Eurodollar Rate Loan, the
Agent shall determine that adequate and reasonable methods do not exist for
ascertaining the Eurodollar Rate that would otherwise determine the rate of
interest to be applicable to any Eurodollar Rate Loan during any Interest
Period, the Agent shall forthwith give notice of such determination (which shall
be conclusive and binding on the Borrowers and the Banks) to the Borrowers and
the Banks. In such event (i) any Loan Request or Conversion Request with
respect to Eurodollar Rate Loans shall be automatically withdrawn and shall be
deemed a request for Base Rate Loans, (ii) each Eurodollar Rate Loan will
automatically, on the last day of the then current Interest Period relating
thereto, become a Base Rate Loan, and (iii) the obligations of the Banks to make
Eurodollar Rate Loans shall be suspended until the Agent determines that the
circumstances giving rise to such suspension no longer exist, whereupon the
Agent shall so notify the Borrowers and the Banks.
5.6. ILLEGALITY. Notwithstanding any other provisions herein, if any
present or future law, regulation, treaty or directive or in the interpretation
or application thereof shall make it unlawful for any Bank to make or maintain
Eurodollar Rate Loans, such Bank shall forthwith give notice of such
circumstances to the Borrowers and the other Banks and thereupon (i) the
commitment of such Bank to make Eurodollar Rate Loans or convert Loans of
another Type to Eurodollar Rate Loans shall forthwith be suspended and (ii) such
Bank's Loans then outstanding as Eurodollar Rate Loans, if any, shall be
converted automatically to Base Rate Loans on the last day of each Interest
Period applicable to such Eurodollar Rate Loans or within such earlier period as
may be required by law. The Borrowers hereby jointly and severally agree
promptly to pay the Agent for the account of such Bank, upon demand by such
Bank, any additional amounts necessary to compensate such Bank for any costs
incurred by such Bank in making any conversion in accordance with this Section
5.6, including any interest or fees payable by such Bank to lenders of funds
obtained by it in order to make or maintain its Eurodollar Rate Loans hereunder.
5.7. ADDITIONAL COSTS, ETC. If any future applicable law, which
expression, as used herein, includes statutes, rules and regulations thereunder
and interpretations thereof by any competent court or by any governmental or
other regulatory body or official charged with the
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administration or the interpretation thereof and requests, directives,
instructions and notices at any time or from time to time hereafter made upon or
otherwise issued to any Bank or the Agent by any central bank or other fiscal,
monetary or other authority (whether or not having the force of law), shall:
(a) subject any Bank or the Agent to any tax, levy, impost, duty,
charge, fee, deduction or withholding of any nature with respect to this
Credit Agreement, the other Loan Documents, any Letters of Credit, such
Bank's Commitment or the Loans (other than taxes based upon or measured
by the income or profits of such Bank or the Agent), or
(b) materially change the basis of taxation (except for changes
in taxes on income or profits) of payments to any Bank of the principal
of or the interest on any Loans or any other amounts payable to any Bank
or the Agent under this Credit Agreement or any of the other Loan
Documents, or
(c) impose or increase or render applicable (other than to the
extent specifically provided for elsewhere in this Credit Agreement) any
special deposit, reserve, assessment, liquidity, capital adequacy or
other similar requirements (whether or not having the force of law)
against assets held by, or deposits in or for the account of, or loans
by, or letters of credit issued by, or commitments of an office of any
Bank, or
(d) impose on any Bank or the Agent any other conditions or
requirements with respect to this Credit Agreement, the other Loan
Documents, any Letters of Credit, the Loans, such Bank's Commitment, or
any class of loans, letters of credit or commitments of which any of the
Loans or such Bank's Commitment forms a part, and the result of any of
the foregoing is
(i) to increase the cost to any Bank of making, funding,
issuing, renewing, extending or maintaining any of the Loans or
such Bank's Commitment or any Letter of Credit, or
(ii) to reduce the amount of principal, interest,
Reimbursement Obligation or other amount payable to such Bank or
the Agent hereunder on account of such Bank's Commitment, any
Letter of Credit or any of the Loans, or
(iii) to require such Bank or the Agent to make any
payment or to forego any interest or Reimbursement
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Obligation or other sum payable hereunder, the amount of which
payment or foregone interest or Reimbursement Obligation or other
sum is calculated by reference to the gross amount of any sum
receivable or deemed received by such Bank or the Agent from the
Borrowers hereunder,
then, and in each such case, the Borrowers will, upon demand made by such Bank
or (as the case may be) the Agent at any time and from time to time and as often
as the occasion therefor may arise, pay to such Bank or the Agent such
additional amounts as will be sufficient to compensate such Bank or the Agent
for such additional cost, reduction, payment or foregone interest or
Reimbursement Obligation or other sum.
5.8. CAPITAL ADEQUACY. If after the date hereof any Bank or the Agent
determines that (i) the adoption of or change in any law, governmental rule,
regulation, policy, guideline or directive (whether or not having the force of
law) regarding capital requirements for banks or bank holding companies or any
change in the interpretation or application thereof by a court or governmental
authority with appropriate jurisdiction, or (ii) compliance by such Bank or the
Agent or any corporation controlling such Bank or the Agent with any law,
governmental rule, regulation, policy, guideline or directive (whether or not
having the force of law) of any such entity imposed after the date hereof
regarding capital adequacy, has the effect of reducing the return on such Bank's
or the Agent's commitment with respect to any Loans to a level below that which
such Bank or the Agent could have achieved but for such adoption, change or
compliance (taking into consideration such Bank's or the Agent's then existing
policies with respect to capital adequacy and assuming full utilization of such
entity's capital) by any amount deemed by such Bank or (as the case may be) the
Agent to be material, then such Bank or the Agent may notify the Borrowers of
such fact. To the extent that the amount of such reduction in the return on
capital is not reflected in the Base Rate, the Borrowers agree to pay such Bank
or (as the case may be) the Agent for the amount of such reduction in the return
on capital as and when such reduction is determined upon presentation by such
Bank or (as the case may be) the Agent of a certificate in accordance with
Section 5.9 hereof. Each Bank shall allocate such cost increases among its
customers in good faith and on an equitable basis.
5.9. CERTIFICATE. A certificate setting forth any additional amounts
payable pursuant to Sections 5.7 or 5.8 and a brief explanation of such amounts
which are due, submitted by any Bank or the Agent to the
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Borrowers, shall be conclusive, absent manifest error, that such amounts are due
and owing.
5.10. INDEMNITY. The Borrowers jointly and severally agree to indemnify
each Bank and to hold each Bank harmless from and against any loss, cost or
expense that such Bank may sustain or incur as a consequence of (i) default by
the Borrowers in payment of the principal amount of or any interest on any
Eurodollar Rate Loans as and when due and payable, including any such loss or
expense arising from interest or fees payable by such Bank to lenders of funds
obtained by it in order to maintain its Eurodollar Rate Loans, (ii) default by
the Borrowers in making a borrowing or conversion after the Borrowers have given
(or are deemed to have given) a Loan Request or a Conversion Request relating
thereto in accordance with Section 2.6 or Section 2.7 or (iii) the making of any
payment of a Eurodollar Rate Loan or the making of any conversion of any such
Loan to a Base Rate Loan on a day that is not the last day of the applicable
Interest Period with respect thereto, including interest or fees payable by such
Bank to lenders of funds obtained by it in order to maintain any such Loans.
5.11. INTEREST AFTER DEFAULT.
5.11.1. OVERDUE AMOUNTS. Overdue principal and (to the extent
permitted by applicable law) interest on the Loans and all other overdue
amounts payable hereunder or under any of the other Loan Documents shall
bear interest compounded monthly and payable on demand at a rate per
annum equal to three percent (3.0%) above the Base Rate until such amount
shall be paid in full (after as well as before judgment).
5.11.2. AMOUNTS NOT OVERDUE. During the continuance of a Default
or an Event of Default the principal of the Loans not overdue shall,
until such Default or Event of Default has been cured or remedied or such
Default or Event of Default has been waived by the Majority Banks
pursuant to Section 26, bear interest at a rate per annum equal to three
percent (3.0%) above the rate of interest otherwise applicable to such
Loans pursuant to Section 2.5.
Section 5.12. CONCERNING JOINT AND SEVERAL LIABILITY OF THE
BORROWERS. (a) Each of the Borrowers is accepting joint and several liability
hereunder and under the other Loan Documents in consideration of the financial
accommodations to be provided by the Banks under this Credit Agreement, for the
mutual benefit, directly and indirectly, of each
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of the Borrowers and in consideration of the undertakings of each other Borrower
to accept joint and several liability for the Obligations.
(b) Each of the Borrowers, jointly and severally, hereby irrevocably and
unconditionally accepts, not merely as a surety but also as a co-debtor, joint
and several liability with the other Borrowers with respect to the payment and
performance of all of the Obligations (including, without limitation, any
Obligations arising under this Section 5.12), it being the intention of the
parties hereto that all of the Obligations shall be the joint and several
Obligations of each of the Borrowers without preference or distinction among
them.
(c) If and to the extent that any of the Borrowers shall fail to make
any payment with respect to any of the Obligations as and when due or to perform
any of the Obligations in accordance with the terms thereof, then in each such
event the other Borrowers will make such payment with respect to, or perform,
such Obligation.
(d) The Obligations of each of the Borrowers under the provisions of
this Section 5.12 constitute full recourse Obligations of each of the Borrowers
enforceable against each such Person to the full extent of its properties and
assets, irrespective of the validity, regularity or enforceability of this
Credit Agreement or any other circumstance whatsoever.
(e) Except as otherwise expressly provided in this Credit Agreement,
each of the Borrowers hereby waives notice of acceptance of its joint and
several liability, notice of any Loans made under this Credit Agreement, notice
of any action at any time taken or omitted by the Banks under or in respect of
any of the Obligations, and, generally, to the extent permitted by applicable
law, all demands, notices and other formalities of every kind in connection with
this Credit Agreement. Each Borrower hereby waives all defenses which may be
available by virtue of any valuation, stay, moratorium law or other similar law
now or hereafter in effect, any right to require the marshaling of assets of the
Borrowers and any other entity or Person primarily or secondarily liable with
respect to any of the Obligations, and all suretyship defenses generally. Each
of the Borrowers hereby assents to, and waives notice of, any extension or
postponement of the time for the payment of any of the Obligations, the
acceptance of any payment of any of the Obligations, the acceptance of any
partial payment thereon, any waiver, consent or other action or acquiescence by
the Banks at any time or times in respect of any default by any of the Borrowers
in the performance or satisfaction of any term, covenant, condition or provision
of this Credit Agreement, any and all other indulgences whatsoever by the Banks
in respect of any of the
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Obligations, and the taking, addition, substitution or release, in whole or
in part, at any time or times, of any security for any of the Obligations or
the addition, substitution or release, in whole or in part, of any of the
Borrowers. Without limiting the generality of the foregoing, each of the
Borrowers assents to any other action or delay in acting or failure to act on
the part of the Banks with respect to the failure by any of the Borrowers to
comply with any of its respective Obligations, including, without limitation,
any failure strictly or diligently to assert any right or to pursue any
remedy or to comply fully with applicable laws or regulations thereunder,
which might, but for the provisions of this Section 5.12, afford grounds for
terminating, discharging or relieving any of the Borrowers, in whole or in
part, from any of its Obligations under this Section 5.12, it being the
intention of each of the Borrowers that, so long as any of the Obligations
hereunder remain unsatisfied, the Obligations of such Borrowers under this
Section 5.12 shall not be discharged except by performance and then only to
the extent of such performance. The Obligations of each of the Borrowers
under this Section 5.12 shall not be diminished or rendered unenforceable by
any winding up, reorganization, arrangement, liquidation, re-construction or
similar proceeding with respect to any of the Borrowers or the Banks. The
joint and several liability of the Borrowers hereunder shall continue in full
force and effect notwithstanding any absorption, merger, amalgamation or any
other change whatsoever in the name, membership, constitution or place of
formation of any of the Borrowers or the Banks.
(f) Each of the Borrowers hereby agrees that it will not enforce any of
its rights of contribution or subrogation against the other Borrowers with
respect to any liability incurred by it hereunder or under any of the other Loan
Documents, any payments made by it to any of the Banks or the Agent with respect
to any of the Obligations or any collateral security therefor until such time as
all of the Obligations have been irrevocably paid in full in cash. Any claim
which any Borrower may have against any other Borrower with respect to any
payments to the Banks or the Agent hereunder or under any other Loan Document
are hereby expressly made subordinate and junior in right of payment, without
limitation as to any increases in the Obligations arising hereunder or
thereunder, to the prior payment in full of the Obligations and, in the event of
any insolvency, bankruptcy, receivership, liquidation, reorganization or other
similar proceeding under the laws of any jurisdiction relating to any Borrower,
its debts or its assets, whether voluntary or involuntary, all such Obligations
shall be paid in full before any payment or distribution of any character,
whether in cash, securities or other property, shall be made to any other
Borrower therefor.
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(g) Each of the Borrowers hereby agrees that the payment of any amounts
due with respect to the indebtedness owing by any Borrower to any other Borrower
is hereby subordinated to the prior payment in full in cash of the Obligations.
Each Borrower hereby agrees that after the occurrences and during the
continuance of any Default or Event of Default, such Borrower will not demand,
xxx for or otherwise attempt to collect any indebtedness of any other Borrower
owing to such Borrower until the Obligations shall have been paid in full in
cash. If, notwithstanding the foregoing sentence, such Borrower shall collect,
enforce or receive any amounts in respect of such indebtedness, such amounts
shall be collected, enforced, received by such Borrower as trustee for the Agent
and be paid over to the Agent for the PRO RATA accounts of the Banks to be
applied to repay the Obligations.
(h) The provisions of this Section 5.12 are made for the benefit of the
Banks and their successors and assigns, and may be enforced in good faith by
them from time to time against any or all of the Borrowers as often as the
occasion therefor may arise and without requirement on the part of the Banks
first to marshal any of their claims or to exercise any of their rights against
any other Borrower or to exhaust any remedies available to them against any
other Borrower or to resort to any other source or means of obtaining payment of
any of the Obligations hereunder or to elect any other remedy. The provisions
of this Section 5.12 shall remain in effect until all of the Obligations shall
have been paid in full or otherwise fully satisfied. If at any time, any
payment, or any part thereof, made in respect of any of the Obligations, is
rescinded or must otherwise be restored or returned by the Banks upon the
insolvency, bankruptcy or reorganization of any of the Borrowers, or otherwise,
the provisions of this Section 5.12 will forthwith be reinstated in effect, as
though such payment had not been made.
6. COLLATERAL SECURITY.
The Obligations shall be secured by a perfected first priority security
interest (subject only to the joint lien of the Trustee for the benefit of the
Noteholders, other Permitted Liens entitled to priority under applicable law and
the Intercreditor Agreement) in substantially all of the assets of the
Borrowers, whether now owned or hereafter acquired, pursuant to the terms of the
Security Documents to which any of the Borrowers is a party.
7. REPRESENTATIONS AND WARRANTIES.
The Borrowers jointly and severally represent and warrant to the Banks
and the Agent on and as of the date of this Credit Agreement, each
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Drawdown Date, and the date of issuance, extension or renewal of any Letter of
Credit as follows:
7.1. CORPORATE AUTHORITY.
7.1.1. INCORPORATION; GOOD STANDING. Each of the Borrowers and
each of such Borrower's Subsidiaries (i) is a corporation duly organized,
validly existing and in good standing under the laws of its state of
incorporation, (ii) has all requisite corporate power to own its property
and conduct its business as now conducted and as presently contemplated,
and (iii) is in good standing as a foreign corporation and is duly
authorized to do business in each jurisdiction where such qualification
is necessary except where a failure to be so qualified would not have a
materially adverse effect on the business, assets or financial condition
of the Borrowers and their Subsidiaries considered as a whole.
7.1.2. AUTHORIZATION. The execution, delivery and performance of
this Credit Agreement, the other Loan Documents and the Recapitalization
Documents to which any of the Borrowers or any of their Subsidiaries is
or is to become a party and the transactions contemplated hereby and
thereby (i) are within the corporate authority of such Person, (ii) have
been duly authorized by all necessary corporate proceedings, (iii) do not
conflict with or result in any breach or contravention of any provision
of law, statute, rule or regulation to which any of the Borrowers or any
of their Subsidiaries is subject or any judgment, order, writ,
injunction, license or permit applicable to any of the Borrowers or any
of their Subsidiaries and (iv) do not conflict with any provision of the
corporate charter or bylaws of, or any agreement or other instrument
binding upon, any of the Borrowers or any of their Subsidiaries.
7.1.3. ENFORCEABILITY. The execution and delivery of this Credit
Agreement, the other Loan Documents and the Recapitalization Documents to
which any of the Borrowers or any of their Subsidiaries is or is to
become a party will result in valid and legally binding obligations of
such Person enforceable against it in accordance with the respective
terms and provisions hereof and thereof, except as enforceability is
limited by bankruptcy, insolvency, reorganization, moratorium or other
laws relating to or affecting generally the enforcement of creditors'
rights and except to the extent that availability of the remedy of
specific performance or
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injunctive relief is subject to the discretion of the court before which
any proceeding therefor may be brought.
7.2. GOVERNMENTAL APPROVALS. The execution, delivery and performance by
any of the Borrowers and any of their Subsidiaries of this Credit Agreement, the
other Loan Documents and the Recapitalization Documents to which any of the
Borrowers or any of their Subsidiaries is or is to become a party and the
transactions contemplated hereby and thereby do not require the approval or
consent of, or filing with, any governmental agency or authority other than
those already made or obtained or, in the case of the filing of Mortgages and
Uniform Commercial Code financing statements, to be made on or immediately after
the Closing Date.
7.3. TITLE TO PROPERTIES; LEASES. Except as indicated on SCHEDULE 7.3
hereto, the Borrowers and their Subsidiaries own all of the assets reflected in
the consolidated balance sheet of the Borrowers and their Subsidiaries as at the
Balance Sheet Date or acquired since that date (except property and assets sold
or otherwise disposed of in accordance with this Credit Agreement since that
date), subject to no rights of others, including any mortgages, leases,
conditional sales agreements, title retention agreements, liens or other
encumbrances except Permitted Liens and except for subleases of real property
and improvements thereon associated with poor performing restaurants closed by
the Borrowers in the exercise of their reasonable business judgment.
7.4. FINANCIAL STATEMENTS AND PROJECTIONS.
7.4.1. FISCAL YEAR. Each of the Borrowers and each of such
Borrower's Subsidiaries has a fiscal year which is the last Monday of
December of each calendar year.
7.4.2. FINANCIAL STATEMENTS. There has been furnished to each of
the Banks a consolidated balance sheet of the Borrowers and their
Subsidiaries as at the Balance Sheet Date, and a consolidated statement
of income of the Borrowers and their Subsidiaries for the fiscal year
then ended, certified by Xxxxxx Xxxxxxxx LLP. Such balance sheet and
statement of income have been prepared in accordance with generally
accepted accounting principles and fairly present the financial condition
of the Borrowers as at the close of business on the date thereof and the
results of operations for the fiscal year then ended. There are no
contingent liabilities of any of the Borrowers or any of their
Subsidiaries as of such date involving material amounts, known to the
officers of the Borrowers, which
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were not disclosed in such balance sheet and the notes related thereto.
7.4.3. PROJECTIONS. The projections of the annual operating
budgets of the Borrowers and their Subsidiaries on a consolidated basis,
balance sheets and cash flow statements for the 1998 to 2001 fiscal
years, copies of which have been delivered to each Bank, disclose all
assumptions made with respect to general economic, financial and market
conditions used in formulating such projections. To the knowledge of any
of the Borrowers or any of their Subsidiaries, no facts exist that
(individually or in the aggregate) would result in any material change in
any of such projections. The projections are based upon reasonable
estimates and assumptions, have been prepared on the basis of the
assumptions stated therein and reflect the reasonable estimates of the
Borrowers and their Subsidiaries of the results of operations and other
information projected therein.
7.5. NO MATERIAL CHANGES, ETC. Since the Balance Sheet Date there has
occurred no materially adverse change in the financial condition or business of
the Borrowers and their Subsidiaries, considered as a whole, as shown on or
reflected in the consolidated balance sheet of the Borrowers and their
Subsidiaries as at the Balance Sheet Date, or the consolidated statement of
income for the fiscal year then ended, other than changes in the ordinary course
of business that have not had any materially adverse effect either individually
or in the aggregate on the business or financial condition of the Borrowers and
their Subsidiaries, considered as a whole. Since the Balance Sheet Date, none
of the Borrowers has made any Distribution other than a Distribution of $25,000
to repurchase stock of Holdings held by departing management employees of the
Borrowers and Holdings.
7.6. FRANCHISES, PATENTS, COPYRIGHTS, ETC. Each of the Borrowers and
each of such Borrower's Subsidiaries possesses all franchises, patents,
copyrights, trademarks, trade names, licenses and permits, and rights in respect
of the foregoing, adequate for the conduct of its business substantially as now
conducted without known material conflict with any rights of others.
7.7. LITIGATION. Except as set forth in SCHEDULE 7.7 hereto, there are
no actions, suits, proceedings or investigations of any kind pending or, to the
best of the Borrowers' knowledge, threatened against any of the Borrowers or any
of their Subsidiaries before any court, tribunal or administrative agency or
board that could, either in any case or in the
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aggregate, reasonably be expected to materially adversely affect the properties,
assets, financial condition or business of the Borrowers and their Subsidiaries,
considered as a whole, or materially impair the right of the Borrowers and their
Subsidiaries, considered as a whole, to carry on business substantially as now
conducted by them, or result in any substantial liability not adequately covered
by insurance, or for which adequate reserves are not maintained on the
consolidated balance sheet of the Borrowers and their Subsidiaries, or which
question the validity of this Credit Agreement or any of the other Loan
Documents, or any action taken or to be taken pursuant hereto or thereto.
7.8. NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Borrowers or any
of their Subsidiaries is subject to any charter, corporate or other legal
restriction, or any judgment, decree, order, rule or regulation that has or is
expected in the future to have a materially adverse effect on the business,
assets or financial condition of the Borrowers and their Subsidiaries,
considered as a whole. None of the Borrowers or any of their Subsidiaries is a
party to any contract or agreement that has or is expected, in the judgment of
the Borrowers' officers, to have any materially adverse effect on the business
of the Borrowers and their Subsidiaries, considered as a whole.
7.9. COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the
Borrowers or any of their Subsidiaries is in violation of any provision of its
charter documents, bylaws, or any agreement or instrument to which it may be
subject or by which it or any of its properties may be bound or any decree,
order, judgment, statute, license, rule or regulation, in any of the foregoing
cases in a manner that could result in the imposition of substantial penalties
or materially and adversely affect the financial condition, properties or
business of the Borrowers and their Subsidiaries, considered as a whole.
7.10. TAX STATUS. The Borrowers and their Subsidiaries (i) have made or
filed all federal and state income and all other material tax returns, reports
and declarations required by any jurisdiction to which any of them is subject,
(ii) have paid all taxes and other governmental assessments and charges shown or
determined to be due on such returns, reports and declarations, except those
being contested in good faith and by appropriate proceedings and (iii) have set
aside on their books provisions reasonably adequate for the payment of all taxes
for periods subsequent to the periods to which such returns, reports or
declarations apply. There are no unpaid taxes in any material amount claimed to
be due by the taxing authority of any jurisdiction, and the officers of the
Borrowers know of no basis for any such claim.
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7.11. NO EVENT OF DEFAULT. No Default or Event of Default has occurred
and is continuing.
7.12. HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the
Borrowers or any of their Subsidiaries is a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company", as
such terms are defined in the Public Utility Holding Company Act of 1935; nor is
any Borrower or any Subsidiary of any Borrower an "investment company", or an
"affiliated company" or a "principal underwriter" of an "investment company", as
such terms are defined in the Investment Company Act of 1940.
7.13. ABSENCE OF FINANCING STATEMENTS, ETC. Except with respect to
Permitted Liens and duly executed Uniform Commercial Code termination statements
provided to the Collateral Agent on the Closing Date, there is no financing
statement, security agreement, chattel mortgage, real estate mortgage or other
document filed or recorded with any filing records, registry or other public
office, that purports to cover, affect or give notice of any present or possible
future lien on, or security interest in, any assets or property of any of the
Borrowers or any of their Subsidiaries or any rights relating thereto. Except
with respect to protective filings covering interests in leased equipment,
furniture and fixtures and proceeds and products thereof, there are no Uniform
Commercial Code financing statements that purport to cover, affect or give
notice of any present or possible future lien on, or security interest in, any
assets or property leased by any of the Borrowers or any of their Subsidiaries.
7.14. PERFECTION OF SECURITY INTEREST. All filings, assignments,
pledges and deposits of documents or instruments have been made or will,
immediately after the Closing Date, have been made and all other actions have
been taken that are necessary or advisable, under applicable law, to establish
and perfect the Agent's security interest in the Collateral. The Collateral and
the Agent's rights with respect to the Collateral are not subject to any
setoff, claims, withholdings or other defenses. The Borrowers are the owners of
the Collateral free from any lien, security interest, encumbrance and any other
claim or demand, except for Permitted Liens.
7.15. CERTAIN TRANSACTIONS. Except for arm's length transactions
pursuant to which any of the Borrowers or any of their Subsidiaries makes
payments in the ordinary course of business upon terms no less favorable than
such Borrower or such Subsidiary could obtain from third parties, none of the
officers, directors, or employees of any of the
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Borrowers or any of their Subsidiaries is presently a party to any transaction
with any of the Borrowers or any of their Subsidiaries (other than for services
as employees, officers and directors), including any contract, agreement or
other arrangement providing for the furnishing of services to or by, providing
for rental of real or personal property to or from, or otherwise requiring
payments to or from any officer, director or such employee or, to the knowledge
of any of the Borrowers, any corporation, partnership, trust or other entity in
which any officer, director, or any such employee has a substantial interest or
is an officer, director, trustee or partner.
7.16. EMPLOYEE BENEFIT PLANS.
7.16.1. IN GENERAL. Each Employee Benefit Plan and each
Guaranteed Pension Plan has been maintained and operated in compliance in
all material respects with the provisions of ERISA and, to the extent
applicable, the Code, including but not limited to the provisions
thereunder respecting prohibited transactions and the bonding of
fiduciaries and other persons handling plan funds as required by Section
412 of ERISA. The Borrowers have heretofore delivered to the Agent the
most recently completed annual report, Form 5500, with all required
attachments, and actuarial statements required to be submitted under
Section 103(d) of ERISA, with respect to each Guaranteed Pension Plan.
7.16.2. TERMINABILITY OF WELFARE PLANS. No Employee Benefit
Plan, which is an employee welfare benefit plan within the meaning of
Section 3(1) or Section 3(2)(B) of ERISA, provides benefit coverage
subsequent to termination of employment, except as required by Title I,
Part 6 of ERISA or the applicable state insurance laws. The Borrowers may
terminate each such Plan at any time (or at any time subsequent to the
expiration of any applicable bargaining agreement) in the discretion of
the Borrowers without liability to any Person other than for claims
arising prior to termination.
7.16.3. GUARANTEED PENSION PLANS. Each contribution required to
be made to a Guaranteed Pension Plan, whether required to be made to
avoid the incurrence of an accumulated funding deficiency, the notice or
lien provisions of Section 302(f) of ERISA, or otherwise, has been timely
made. No waiver of an accumulated funding deficiency or extension of
amortization periods has been received with respect to any Guaranteed
Pension Plan, and none of the Borrowers nor any ERISA Affiliate is
obligated to or has posted security in connection with an amendment to a
Guaranteed Pension Plan pursuant to Section 307
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of ERISA or Section 401(a)(29) of the Code. No liability to the PBGC
(other than required insurance premiums, all of which have been paid) has
been incurred by any Borrower or any ERISA Affiliate with respect to any
Guaranteed Pension Plan and there has not been any ERISA Reportable Event
(other than an ERISA Reportable Event as to which the requirement of 30
days' notice has been waived), or any other event or condition which
presents a material risk of termination of any Guaranteed Pension Plan by
the PBGC. Based on the latest valuation of each Guaranteed Pension Plan
(which in each case occurred within twelve months of the date of this
representation), and on the actuarial methods and assumptions employed
for that valuation, the aggregate benefit liabilities of all such
Guaranteed Pension Plans within the meaning of Section 4001 of ERISA did
not exceed the aggregate value of the assets of all such Guaranteed
Pension Plans, disregarding for this purpose the benefit liabilities and
assets of any Guaranteed Pension Plan with assets in excess of benefit
liabilities.
7.16.4. MULTIEMPLOYER PLANS. None of the Borrowers nor any ERISA
Affiliate has incurred any material liability (including secondary
liability) to any Multiemployer Plan as a result of a complete or partial
withdrawal from such Multiemployer Plan under Section 4201 of ERISA or as
a result of a sale of assets described in Section 4204 of ERISA. None of
the Borrowers nor any ERISA Affiliate has been notified that any
Multiemployer Plan is in reorganization or insolvent under and within the
meaning of Section 4241 or Section 4245 of ERISA or is at risk of
entering reorganization or becoming insolvent, or that any Multiemployer
Plan intends to terminate or has been terminated under Section 4041A of
ERISA.
7.17. USE OF PROCEEDS.
7.17.1. GENERAL. The proceeds of the Loans shall be used for the
acquisition and/or construction of new facilities, for facility upgrades
and for working capital and general corporate purposes. The Borrowers
will obtain Letters of Credit solely for general corporate purposes.
7.17.2. REGULATIONS U AND X. No portion of any Loan is to be
used, and no portion of any Letter of Credit is to be obtained, for the
purpose of purchasing or carrying any "margin security" or "margin stock"
as such terms are used in Regulations U and X of the Board of Governors
of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
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7.17.3. INELIGIBLE SECURITIES. No portion of the proceeds of any
Loans is to be used, and no portion of any Letter of Credit is to be
obtained, for the purpose of (a) knowingly purchasing, or providing
credit support for the purchase of, Ineligible Securities from a Section
20 Subsidiary during any period in which such Section 20 Subsidiary makes
a market in such Ineligible Securities, (b) knowingly purchasing, or
providing credit support for the purchase of, during the underwriting or
placement period, any Ineligible Securities being underwritten or
privately placed by a Section 20 Subsidiary, or (c) making, or providing
credit support for the making of, payments of principal or interest on
Ineligible Securities underwritten or privately placed by a Section 20
Subsidiary and issued by or for the benefit of any Borrower or any
Subsidiary or other Affiliate of any of the Borrowers.
7.18. ENVIRONMENTAL COMPLIANCE. The Borrowers have taken all necessary
steps to investigate the past and present condition and usage of the Real Estate
and the operations conducted thereon and, based upon such diligent
investigation, have determined that:
(a) none of the Borrowers, their Subsidiaries or any operator of
the Real Estate or any operations thereon is in violation, or alleged
violation, of any judgment, decree, order, law, license, rule or
regulation pertaining to environmental matters, including without
limitation, those arising under the Resource Conservation and Recovery
Act ("RCRA"), the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 as amended ("CERCLA"), the Superfund Amendments and
Reauthorization Act of 1986 ("XXXX"), the Federal Clean Water Act, the
Federal Clean Air Act, the Toxic Substances Control Act, or any state or
local statute, regulation, ordinance, order or decree relating to health,
safety or the environment (hereinafter "Environmental Laws"), which
violation would have a material adverse effect on the business, assets or
financial condition of the Borrowers and their Subsidiaries, considered
as a whole;
(b) none of the Borrowers or any of their Subsidiaries has
received notice from any third party including, without limitation, any
federal, state or local governmental authority, (i) that any one of them
has been identified by the United States Environmental Protection Agency
("EPA") as a potentially responsible party under CERCLA with respect to a
site listed on the National Priorities List, 40 C.F.R. Part 000 Xxxxxxxx
X; (ii) that any hazardous waste, as defined by 42 U.S.C. Section
6903(5), any hazardous substances as defined
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by 42 U.S.C. Section 9601(14), any pollutant or contaminant as defined by
42 U.S.C. Section 9601(33) and any toxic substances, oil or hazardous
materials or other chemicals or substances regulated by any Environmental
Laws ("Hazardous Substances") which any one of them has generated,
transported or disposed of has been found at any site at which a federal,
state or local agency or other third party has conducted or has ordered
that any Borrower or any Subsidiary of any Borrower conduct a remedial
investigation, removal or other response action pursuant to any
Environmental Law, the costs of which remedial investigation, removal or
other response action could not reasonably be expected to have a material
adverse effect on the business, assets or financial condition of the
Borrowers and their Subsidiaries, considered as a whole; or (iii) that it
is or shall be a named party to any claim, action, cause of action,
complaint, or legal or administrative proceeding (in each case,
contingent or otherwise, but excluding claims, actions, causes of action,
complaints or legal or administrative proceedings, the outcome of which
could not reasonably be expected to have a material adverse effect on the
business, assets or financial condition of the Borrowers and their
Subsidiaries, considered as a whole) arising out of any third party's
incurrence of costs, expenses, losses or damages of any kind whatsoever
in connection with the release of Hazardous Substances;
(c) except as set forth on SCHEDULE 7.18 attached hereto and
except with respect to any of the following which could not reasonably be
expected to have a material adverse effect on the value of any of the
Real Estate or on the business, assets or financial condition of the
Borrowers and their Subsidiaries, considered as a whole: (i) no portion
of the Real Estate has been used for the handling, processing, storage or
disposal of Hazardous Substances except in accordance with applicable
Environmental Laws; and no underground tank or other underground storage
receptacle for Hazardous Substances is located on any portion of the Real
Estate; (ii) in the course of any activities conducted by any of the
Borrowers, any of their Subsidiaries or operators of the properties of
any of the Borrowers or any of their Subsidiaries, no Hazardous
Substances have been generated or are being used on the Real Estate
except in accordance with applicable Environmental Laws; (iii) there have
been no releases (i.e., any past or present releasing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
disposing or dumping) or threatened releases of Hazardous Substances on,
upon, into or from the properties of the Borrowers or their Subsidiaries;
(iv) to the best
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of the Borrowers' knowledge, there have been no releases on, upon, from
or into any real property in the vicinity of any of the Real Estate
which, through soil or groundwater contamination, may have come to be
located on the Real Estate; and (v) in addition, any Hazardous Substances
that have been generated on any of the Real Estate have been transported
offsite only by carriers having an identification number issued by the
EPA, treated or disposed of only by treatment or disposal facilities
maintaining valid permits as required under applicable Environmental
Laws, which transporters and facilities have been and are, to the best of
the Borrowers' knowledge, operating in compliance with such permits and
applicable Environmental Laws; and
(d) None of the Borrowers or their Subsidiaries, any Mortgaged
Property or any of the other Real Estate is subject to any applicable
environmental law requiring the performance of Hazardous Substances site
assessments, or the removal or remediation of Hazardous Substances, or
the giving of notice to any governmental agency or the recording or
delivery to other Persons of an environmental disclosure document or
statement by virtue of the transactions set forth herein and contemplated
hereby, or as a condition to the recording of any Mortgage or to the
effectiveness of any other transactions contemplated hereby.
7.19. SUBSIDIARIES, ETC. LFI, Grandy's, AEI, APM, Spoons and Spectrum
are the only direct Subsidiaries of ARG, and Black Angus of Idaho is the only
indirect Subsidiary of ARG. Black Angus of Idaho is the sole Subsidiary of AEI,
and LFI, Grandy's, APM, Spoons and Spectrum have no Subsidiaries. Black Angus
of Idaho is not presently engaged in business activities of any kind or nature,
and does not have a net worth or assets of more than DE MINIMIS value. The
capitalization of Holdings and of ARG , after giving effect to the
Recapitalization as of the Closing Date is as set forth on SCHEDULE 7.19.
Except as set forth on SCHEDULE 7.19 hereto, no Borrower nor any Subsidiary of
any Borrower is engaged in any joint venture or partnership with any other
Person.
7.20. BANK ACCOUNTS. SCHEDULE 7.20 sets forth the account numbers and
location of all Local Accounts, Interim Concentration Accounts and other bank
accounts of each of the Borrowers and their Subsidiaries.
7.21. YEAR 2000 PROBLEM. The Borrowers and their Subsidiaries have
reviewed the areas within their businesses and operations which could be
adversely affected by, and have developed or are developing
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a program to address on a timely basis, the "Year 2000 Problem" (i.e., the risk
that computer applications used by any of the Borrowers or any of their
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 upon such review, the Borrowers reasonably believe that the "Year
2000 Problem" will not have any materially adverse effect on the business or
financial condition of the Borrowers and their Subsidiaries, considered as a
whole.
7.22. DISCLOSURE. None of this Credit Agreement, any of the other Loan
Documents or any of the Recapitalization Documents contains any untrue statement
of a material fact or omits to state a material fact (known to the Borrowers or
any of their Subsidiaries in the case of any document or information not
furnished by any of the Borrowers or any of their Subsidiaries) necessary in
order to make the statements herein or therein not misleading. There is no fact
known to any of the Borrowers or any of their Subsidiaries which materially
adversely affects, or which is reasonably likely in the future to materially
adversely affect, the business, assets, financial condition or prospects of the
Borrowers and their Subsidiaries, considered as a whole, exclusive of effects
resulting from changes in general economic conditions, legal standards or
regulatory conditions.
7.23. RECAPITALIZATION. Each of the representations and warranties made
by any of the Borrowers in any of the Recapitalization Documents was true and
correct in all material respects on the Closing Date. SCHEDULE 7.23 sets forth
a complete list of the Recapitalization Documents, and the Borrowers represent
and warrant that, as of the Closing Date, none of the Recapitalization Documents
has been modified, amended or supplemented, except as disclosed on SCHEDULE
7.23. The Borrowers have delivered to the Agent and the Banks true, complete
and correct copies of the Recapitalization Documents.
8. AFFIRMATIVE COVENANTS OF THE BORROWERS.
The Borrowers jointly and severally covenant and agree that, so long as
any Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is
outstanding or any Bank has any obligation to make any Loans or the Agent has
any obligation to issue, extend or renew any Letters of Credit:
8.1. PUNCTUAL PAYMENT. The Borrowers will duly and punctually pay or
cause to be paid the principal and interest on the Loans, all Reimbursement
Obligations, the Letter of Credit Fees, the commitment fees, the Agent's fee and
all other amounts provided for in this Credit
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Agreement and the other Loan Documents to which any of the Borrowers or any of
their Subsidiaries is a party, all in accordance with the terms of this Credit
Agreement and such other Loan Documents.
8.2. MAINTENANCE OF OFFICE. The Borrowers will maintain their chief
executive office in Newport Beach, California, or at such other place or places
in the United States of America as the Borrowers shall designate upon written
notice to the Agent, where notices, presentations and demands to or upon the
Borrowers in respect of the Loan Documents to which the Borrowers are a party
may be given or made.
8.3. RECORDS AND ACCOUNTS. Each of the Borrowers will (i) keep, and
cause each of its Subsidiaries to keep, true and accurate records and books of
account in which full, true and correct entries will be made in accordance with
generally accepted accounting principles, (ii) maintain adequate accounts and
reserves for all taxes (including income taxes), depreciation, depletion,
obsolescence and amortization of its properties and the properties of its
Subsidiaries, contingencies, and other reserves, and (iii) at all times engage
Xxxxxx Xxxxxxxx LLP or other independent certified public accountants
satisfactory to the Agent as the independent certified public accountants of the
Borrowers and their Subsidiaries and will not permit more than thirty (30) days
to elapse between the cessation of such firm's (or any successor firm's)
engagement as the independent certified public accountants of the Borrowers and
their Subsidiaries and the appointment in such capacity of a successor firm as
shall be satisfactory to the Agent.
8.4. FINANCIAL STATEMENTS, CERTIFICATES AND INFORMATION. The Borrowers
will deliver to each of the Banks:
(a) as soon as practicable, but in any event not later than
ninety (90) days after the end of each fiscal year of the Borrowers, the
consolidated balance sheet of the Borrowers and their Subsidiaries and
the consolidating (prepared by division rather than by corporate entity)
balance sheet of the Borrowers and their Subsidiaries, each as at the end
of such year, and the related consolidated statement of income and
consolidated statement of cash flow and consolidating (prepared by
division rather than by corporate entity) statement of income for such
year, each setting forth in comparative form the figures for the previous
fiscal year and all such consolidated and consolidating statements to be
in reasonable detail, prepared in accordance with generally accepted
accounting principles, and certified without qualification by Xxxxxx
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Xxxxxxxx LLP or by other independent certified public accountants
satisfactory to the Agent;
(b) as soon as practicable, but in any event not later than
forty-five (45) days after the end of each of the fiscal quarters of the
Borrowers, copies of the unaudited consolidated balance sheet of the
Borrowers and their Subsidiaries and the unaudited consolidating
(prepared by division rather than by corporate entity) balance sheet of
the Borrowers and their Subsidiaries, each as at the end of such quarter,
and the related consolidated statement of income and consolidated
statement of cash flow and consolidating (prepared by division rather
than by corporate entity) statement of income for such quarter and the
portion of the Borrowers' fiscal year then elapsed, all in reasonable
detail and prepared in accordance with generally accepted accounting
principles, together with a certification by the principal financial or
accounting officer of the Borrowers that the information contained in
such financial statements fairly presents the financial position of the
Borrowers and their Subsidiaries on the date thereof (subject to year-end
adjustments);
(c) as soon as practicable, but in any event within thirty (30)
days after the end of each month in each fiscal year of the Borrowers,
the unaudited consolidated balance sheet of the Borrowers and their
Subsidiaries and unaudited consolidating (prepared by division rather
than by corporate entity) balance sheet of the Borrowers and their
Subsidiaries, each as at the end of such month, and the related
consolidated statement of income and consolidated statement of cash flow
and consolidating (prepared by division rather than by corporate entity)
statement of income for such month, all in reasonable detail and each
prepared in accordance with generally accepted accounting principles,
together with a certification by the principal financial or accounting
officer of the Borrowers that the information contained in such financial
statements fairly presents the financial condition of the Borrowers and
their Subsidiaries on the date thereof (subject to year-end adjustments);
(d) simultaneously with the delivery of the financial statements
referred to in subsections (a) and (b) above, a statement certified by
the principal financial or accounting officer of the Borrowers in
substantially the form of EXHIBIT C hereto and setting forth in
reasonable detail computations evidencing compliance with the covenants
contained in Section 10 and (if applicable) reconciliations to
-53-
reflect changes in generally accepted accounting principles since the
Balance Sheet Date;
(e) contemporaneously with the filing or mailing thereof, copies
of all material of a financial nature filed with the Securities and
Exchange Commission or sent to the stockholders of the Borrowers;
(f) (i) on or prior to the end of each fiscal year of the
Borrowers and their Subsidiaries and otherwise from time to time upon
request of the Agent, a monthly budget for the next fiscal year of the
Borrowers and their Subsidiaries including PRO FORMA consolidated and
consolidating (prepared by division rather than by corporate entity)
statements of income and consolidated statement of cash flows of the
Borrowers and their Subsidiaries, and (ii) if prepared by the Borrowers
or requested by the Agent, projections updating those projections
delivered to the Banks and referred to in Section 7.4.3 or, if
applicable, updating any later such projections delivered in response to
a request pursuant to this Section 8.4(f); and
(g) from time to time such other financial data and information
(including accountants, management letters) as the Agent or any Bank may
reasonably request.
8.5. NOTICES.
8.5.1. DEFAULTS. The Borrowers will promptly notify the Agent
and each of the Banks in writing of the occurrence of any Default or
Event of Default. If any Person shall give any notice or take any other
action in respect of a claimed default (whether or not constituting an
Event of Default) under this Credit Agreement or any other note, evidence
of indebtedness, indenture or other obligation in excess of $1,000,000 to
which or with respect to which any of the Borrowers or any of their
Subsidiaries is a party or obligor, whether as principal, guarantor,
surety or otherwise, the Borrowers shall forthwith give written notice
thereof to the Agent and each of the Banks, describing the notice or
action and the nature of the claimed default.
8.5.2. ENVIRONMENTAL EVENTS. The Borrowers will promptly give
notice to the Agent and each of the Banks (i) of any material violation
of any Environmental Law that any of the Borrowers or any of their
Subsidiaries reports in writing or is reportable by such Person in
writing (or for which any written report supplemental to any oral report
is made) to any federal, state or local environmental
-54-
agency and (ii) upon becoming aware thereof, of any inquiry, proceeding,
investigation, or other action, including a notice from any agency of
potential environmental liability, of any federal, state or local
environmental agency or board, that has the potential to materially
affect the assets, liabilities, financial conditions or operations of the
Borrowers and their Subsidiaries, considered as a whole, or the Agent's
mortgages, deeds of trust or security interests pursuant to the Security
Documents.
8.5.3. NOTIFICATION OF CLAIM AGAINST COLLATERAL. The Borrowers
will, immediately upon becoming aware thereof, notify the Agent and each
of the Banks in writing of any setoff, claims (including, with respect to
the Real Estate, environmental claims), withholdings or other defenses to
which any of the Collateral, or the Agent's rights with respect to the
Collateral, are subject.
8.5.4. NOTICE OF LITIGATION AND JUDGMENTS. The Borrowers will,
and will cause each of their Subsidiaries to, give notice to the Agent
and each of the Banks in writing within fifteen (15) days of becoming
aware of any litigation or proceedings threatened in writing or any
pending litigation and proceedings affecting any of the Borrowers or any
of their Subsidiaries or to which any of the Borrowers or any of their
Subsidiaries is or becomes a party involving an uninsured claim against
any of the Borrowers or any of their Subsidiaries that could reasonably
be expected to have a materially adverse effect on the Borrowers and
their Subsidiaries, considered as a whole, and stating the nature and
status of such litigation or proceedings. Each of the Borrowers will,
and will cause each of its Subsidiaries to, give notice to the Agent and
each of the Banks, in writing, in form and detail satisfactory to the
Agent, within ten (10) days of any judgment not covered by insurance,
final or otherwise, against any of the Borrowers or any of their
Subsidiaries in an amount in excess of $1,000,000.
8.6. CORPORATE EXISTENCE; MAINTENANCE OF PROPERTIES. Each of the
Borrowers will do or cause to be done all things necessary to preserve and keep
in full force and effect its corporate existence, rights and franchises and
those of its Subsidiaries and will not, and will not cause or permit any of its
Subsidiaries to, convert to a limited liability company or limited liability
partnership. Each of the Borrowers (i) will cause all of its properties and
those of its Subsidiaries used or useful in the conduct of its business or the
business of its Subsidiaries to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment, (ii) will cause to
be made all necessary repairs, renewals,
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replacements, betterments and improvements thereof, all as in the judgment of
such Borrower may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times, and (iii)
will, and will cause each of its Subsidiaries to, continue to engage primarily
in the businesses now conducted by it or them and in related businesses;
PROVIDED that nothing in this Section 8.6 shall prevent any of the Borrowers
from discontinuing the operation and maintenance of any of its properties or any
of those of its Subsidiaries if such discontinuances are, in the judgment of
such Borrower, desirable in the conduct of its business and do not in the
aggregate materially adversely affect the business of the Borrowers and their
Subsidiaries on a consolidated basis.
8.7. INSURANCE. Each of the Borrowers will, and will cause each of its
Subsidiaries to, maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with the general practices of
businesses engaged in similar activities in similar geographic areas and in
amounts, containing such terms, in such forms and for such periods as may be
reasonable and prudent and in accordance with the terms of the Security
Agreements. Each of the Borrowers will, and will cause each of its Subsidiaries
to, maintain insurance on the Mortgaged Properties in accordance with the terms
of the Mortgages.
8.8. TAXES. Each of the Borrowers will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, as
well as all claims for labor, materials, or supplies that if unpaid might by law
become a lien or charge upon any of its property; PROVIDED that any such tax,
assessment, charge, levy or claim need not be paid if the validity or amount
thereof shall currently be contested in good faith by appropriate proceedings
and if such Borrower or such Subsidiary shall have set aside on its books
adequate reserves with respect thereto; and PROVIDED FURTHER that each of the
Borrowers and each of its Subsidiaries will pay all such taxes, assessments,
charges, levies or claims forthwith upon the commencement of proceedings to
foreclose any lien that may have attached as security therefor.
8.9. INSPECTION OF PROPERTIES AND BOOKS, ETC.
8.9.1. GENERAL. The Borrowers shall permit the Banks, through
the Agent or any of the Banks' other designated
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representatives, to visit and inspect any of the properties of any of the
Borrowers or any of their Subsidiaries, to examine the books of account
of any of the Borrowers and its Subsidiaries (and to make copies thereof
and extracts therefrom), and to discuss the affairs, finances and
accounts of any of the Borrowers and its Subsidiaries with, and to be
advised as to the same by, its and their officers, all at such reasonable
times and intervals as the Agent or any Bank may reasonably request.
8.9.2. COMMUNICATIONS WITH ACCOUNTANTS. The Borrowers authorize
the Agent and, if accompanied by the Agent, the Banks to communicate
directly with the Borrowers' independent certified public accountants and
authorizes such accountants to disclose to the Agent and the Banks any
and all financial statements and other supporting financial documents and
schedules including copies of any management letter with respect to the
business, financial condition and other affairs of any of the Borrowers
or any of their Subsidiaries. At the request of the Agent, the Borrowers
shall deliver a letter addressed to such accountants instructing them to
comply with the provisions of this Section 8.9.4.
8.10. COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. Each of
the Borrowers will, and will cause each of its Subsidiaries to, comply in all
material respects with (i) the applicable laws and regulations wherever its
business is conducted, including all Environmental Laws, (ii) the provisions of
its charter documents and by-laws, (iii) all agreements and instruments by which
it or any of its properties may be bound and (iv) all applicable decrees,
orders, and judgments. If any authorization, consent, approval, permit or
license from any officer, agency or instrumentality of any government shall
become necessary or required in order that any of the Borrowers or any of their
Subsidiaries may fulfill any of its obligations hereunder or any of the other
Loan Documents to which such Borrower or such Subsidiary is a party, such
Borrower will, or (as the case may be) will cause such Subsidiary to,
immediately take or cause to be taken all reasonable steps within the power of
such Borrower or such Subsidiary to obtain such authorization, consent,
approval, permit or license and furnish the Agent with evidence thereof.
8.11. EMPLOYEE BENEFIT PLANS. The Borrowers will (i) promptly upon
filing the same with the Department of Labor or Internal Revenue Service and
upon request of the Agent, furnish to the Agent a copy of the most recent
actuarial statement required to be submitted under Section 103(d) of ERISA and
Annual Report, Form 5500, with all required attachments, in
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respect of each Guaranteed Pension Plan and (ii) promptly upon receipt or
dispatch, furnish to the Agent any notice, report or demand sent or received in
respect of a Guaranteed Pension Plan under Sections 302, 4041, 4042, 4043, 4063,
4065, 4066 and 4068 of ERISA, or in respect of a Multiemployer Plan, under
Sections 4041A, 4202, 4219, 4242, or 4245 of ERISA.
8.12. USE OF PROCEEDS. The Borrowers will use the proceeds of the Loans
solely for acquisition and/or construction of new facilities, for facility
upgrades and for working capital and general corporate purposes. The Borrowers
will obtain Letters of Credit solely for general corporate purposes.
8.13. ADDITIONAL MORTGAGED PROPERTY. If, after the Closing Date, any of
the Borrowers or any of their Subsidiaries acquires or leases real estate, other
than real estate acquired with the proceeds of Indebtedness permitted by Section
9.1(d), such Borrower shall, or shall cause such Subsidiary to, in each case to
the extent reasonably requested by the Agent, forthwith deliver to the
Collateral Agent for the benefit of the Secured Parties a fully executed
mortgage or deed of trust over such real estate, in form and substance
satisfactory to the Agent, together with title insurance policies, surveys,
evidences of insurances with the Collateral Agent named as loss payee and
additional insured, legal opinions and other documents and certificates with
respect to such real estate as was required for Real Estate of such Borrower or
such Subsidiary as of the Closing Date. At any time following the Closing Date,
upon written request of the Agent, the Borrowers shall, and shall cause any of
their Subsidiaries to, forthwith deliver to the Collateral Agent for the benefit
of the Secured Parties a fully executed mortgage or deed of trust over any Real
Estate owned or leased but not mortgaged to the Collateral Agent on the Closing
Date, in form and substance satisfactory to the Agent, together with title
insurance policies, surveys, evidences of insurance with the Collateral Agent
named as loss payee and additional insured, legal opinions and other documents
and certificates with respect to such Real Estate as was required for Real
Estate of such Borrower or such Subsidiary as to the Closing Date. The
Borrowers further agree that, following the taking of such actions with respect
to such real estate, the Collateral Agent shall have for the benefit of the
Secured Parties a valid and enforceable first priority mortgage or deed of trust
over such real estate, free and clear of all defects and encumbrances except for
Permitted Liens.
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8.14. BANK ACCOUNTS.
8.14.1. GENERAL. On or prior to the Closing Date, the Borrowers
will, and will cause their Subsidiaries to, (i) establish a depository
account (the "BKB Concentration Account") under the control of the Agent
for the benefit of the Banks subject to the Intercreditor Agreement, in
the name of the Borrowers, (ii) cause all cash proceeds of Accounts
Receivable, all cash payments received in the ordinary course of the
Borrowers' restaurant business and all other cash of any of the Borrowers
to be deposited only into (A) concentration or other accounts ("Interim
Concentration Accounts") with financial institutions which have entered
into agency account agreements and, if applicable, lock box agreements
(collectively, the "Agency Account Agreements") in form and substance
satisfactory to the Agent and covering accounts which are subject to such
agreements, (B) local depository accounts ("Local Accounts") or (C) the
BKB Concentration Account, (iii) direct all depository institutions with
Local Accounts to cause all funds held in each such Local Account to be
transferred no less frequently than once each day to, and only to, an
Interim Concentration Account or the BKB Concentration Account, with the
Agent having the right so to direct such depository institutions (which
notice may be given by the Agent at any time following the occurrence of
a Default or Event of Default, regardless of whether or not such Default
or Event of Default has been cured or waived) (iv) direct all depository
institutions with Interim Concentration Accounts to cause all funds of
the Borrowers and their Subsidiaries held in such Interim Concentration
Accounts to be transferred daily to, and only to, the BKB Concentration
Account, following such depository institution's receipt of notice from
the Agent (which notice may be given by the Agent at any time following
the occurrence of a Default or Event of Default, regardless of whether or
not such Default or Event of Default has been cured or waived) in
accordance with the terms of its Agency Account Agreement, and (v) at all
times ensure that immediately upon the receipt by any of the Borrowers or
any of their Subsidiaries of any funds constituting cash proceeds of any
Collateral, all such amounts shall have been deposited in a Local
Account, an Interim Concentration Account or the BKB Concentration
Account.
8.14.2. ACKNOWLEDGMENT OF APPLICATION. The Borrowers hereby
agree that all amounts received by the Agent in the BKB Concentration
Account following the occurrence of a Default or an Event of Default will
be the sole and exclusive property of the
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Agent, for the accounts of the Banks, subject to the Intercreditor
Agreement and to be applied in accordance with Section 2.9.
8.15. FURTHER ASSURANCES. Each of the Borrowers will, and will cause
each of its Subsidiaries to, cooperate with the Banks and the Agent and execute
such further instruments and documents as the Banks or the Agent shall
reasonably request to carry out to their satisfaction the transactions
contemplated by this Credit Agreement and the other Loan Documents.
8.16. POST-CLOSING UNDERTAKINGS. The Borrowers shall complete, or shall
cause the completion of, to the satisfaction of the Agent, all of the
conditions, actions and items set forth in the Post Closing Letter on or before
the respective due dates therefor set forth therein.
9. CERTAIN NEGATIVE COVENANTS OF THE BORROWERS.
The Borrowers jointly and severally covenant and agree that, so long as
any Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is
outstanding or any Bank has any obligation to make any Loans or the Agent has
any obligations to issue, extend or renew any Letters of Credit:
9.1. RESTRICTIONS ON INDEBTEDNESS. The Borrowers will not, and will not
permit any of their Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness other
than:
(a) Indebtedness to the Banks and the Agent arising under any of
the Loan Documents;
(b) endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary
course of business;
(c) Indebtedness arising under the Indenture and the Senior Notes
or consisting of the PIK Preferred Stock issued on the Closing Date (but
in no event including any debentures for which such PIK Preferred Stock
may be exchanged);
(d) Indebtedness incurred in connection with the acquisition
after the date hereof of any real or personal property by such Borrower
or such Subsidiary or under any Capitalized Lease, PROVIDED that the
aggregate principal amount of such Indebtedness
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of the Borrowers and their Subsidiaries shall not exceed the aggregate
amount of $5,000,000 at any one time;
(e) Indebtedness not otherwise permitted by this Section 9.1 and
which is existing on the date hereof and listed and described on
SCHEDULE 9.1 hereto; and
(f) Indebtedness of any Borrower to any other Borrower.
9.2. RESTRICTIONS ON LIENS. The Borrowers will not, and will not permit
any of their Subsidiaries to, (i) create or incur or suffer to be created or
incurred or to exist any lien, encumbrance, mortgage, pledge, charge,
restriction or other security interest of any kind upon any of its property or
assets of any character whether now owned or hereafter acquired, or upon the
income or profits therefrom; (ii) transfer any of such property or assets or the
income or profits therefrom for the purpose of subjecting the same to the
payment of Indebtedness or performance of any other obligation in priority to
payment of its general creditors; (iii) acquire, or agree or have an option to
acquire, any property or assets upon conditional sale or other title retention
or purchase money security agreement, device or arrangement; (iv) suffer to
exist for a period of more than thirty (30) days after the same shall have been
incurred any Indebtedness or claim or demand against it that if unpaid might by
law or upon bankruptcy or insolvency, or otherwise, be given any priority
whatsoever over its general creditors; (v) sell, assign, pledge or otherwise
transfer any "receivables" as defined in clause (vii) of the definition of the
term "Indebtedness," with or without recourse; or (vi) enter into or permit to
exist any arrangement or agreement, enforceable under applicable law, which
directly or indirectly prohibits any of the Borrowers or any of their
Subsidiaries from creating or incurring any lien, encumbrance, mortgage, pledge,
charge, restriction or other security interest other than in favor of the
Collateral Agent for the benefit of the Banks and the Agent under the Loan
Documents and for the benefit of the Trustee and the Noteholders under the
Indenture, and under Capitalized Leases and other agreements evidencing
Indebtedness permitted by Section 9.1(d) and only with respect to the specific
assets financed thereby, and other than customary anti-assignment provisions in
leases and licensing agreements entered into by such Borrower or such Subsidiary
in the ordinary course of its business, PROVIDED that any of the Borrowers or
any of their Subsidiaries may create or incur or suffer to be created or
incurred or to exist:
(a) liens in favor of any of the Borrowers (the "Secured
Borrower") on all or part of the assets of another Borrower securing
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Indebtedness owing by such other Borrower to such Secured Borrower;
(b) liens to secure taxes, assessments and other government
charges in respect of obligations not overdue or liens on properties
other than Mortgaged Properties to secure claims for labor, material or
supplies in respect of obligations not overdue;
(c) deposits or pledges made in connection with, or to secure
payment of, worker's compensation, unemployment insurance, old age
pensions or other social security obligations;
(d) liens on properties other than Mortgaged Properties in
respect of judgments or awards that have been in force for less than the
applicable period for taking an appeal so long as execution is not levied
thereunder or in respect of which such Borrower or such Subsidiary shall
at the time in good faith be prosecuting an appeal or proceedings for
review and in respect of which a stay of execution shall have been
obtained pending such appeal or review;
(e) liens of carriers, warehousemen, mechanics and materialmen,
and other like liens on properties in existence less than 120 days from
the date of creation thereof in respect of obligations not overdue;
(f) encumbrances on Real Estate consisting of easements, rights
of way, zoning restrictions, restrictions on the use of real property and
defects and irregularities in the title thereto, landlord's or lessor's
liens under leases to which any of the Borrowers or a Subsidiary of any
of the Borrowers is a party, and other minor liens or encumbrances none
of which in the opinion of the Borrowers interferes materially with the
use of the property affected in the ordinary conduct of the business of
the Borrowers and their Subsidiaries, which defects do not individually
or in the aggregate have a materially adverse effect on the business of
any Borrower individually or of the Borrowers and their Subsidiaries on a
consolidated basis;
(g) liens not otherwise permitted by this Section 9.2 which are
existing on the date hereof and listed on SCHEDULE 9.2 hereto;
(h) purchase money security interests in or purchase money
mortgages on real or personal property other than Mortgaged Properties
acquired after the date hereof to secure purchase money Indebtedness of
the type and amount permitted by Section 9.1(d), incurred
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in connection with the acquisition of such property, which security
interests or mortgages cover only the real or personal property so
acquired;
(i) liens and encumbrances on each Mortgaged Property as and to
the extent permitted by the Mortgage applicable thereto; and
(j) liens in favor of the Collateral Agent for the benefit of the
Banks and the Agent under the Loan Documents and of the Trustee and the
Noteholders under the Indenture.
9.3. RESTRICTIONS ON INVESTMENTS. The Borrowers will not, and will not
permit any of their Subsidiaries to, make or permit to exist or to remain
outstanding any Investment except Investments in:
(a) marketable direct or guaranteed obligations of the United
States of America or any agency or instrumentality thereof that mature
within one (1) year from the date of purchase by any Borrower;
(b) demand deposits, certificates of deposit, bankers acceptances
and time deposits of United States banks having total assets in excess of
$1,000,000,000;
(c) securities commonly known as "commercial paper" issued by a
corporation organized and existing under the laws of the United States of
America or any state thereof that at the time of purchase have been rated
and the ratings for which are not less than "P 1" if rated by Xxxxx'x
Investors Service, Inc., and not less than "A 1" if rated by Standard and
Poor's Rating Group;
(d) Investments not otherwise permitted by this Section 9.3 which
are existing on the date hereof and listed on SCHEDULE 9.3 hereto;
(e) Investments with respect to Indebtedness permitted by Section
9.1(f) so long as such entities remain Borrowers, together with other
Investments by Borrowers in Borrowers;
(f) Investments existing on the Closing Date by the Borrowers in
Subsidiaries of the Borrowers;
(g) Investments consisting of promissory notes received as
proceeds of asset dispositions permitted by Section 9.5.2;
(h) Investments consisting of loans and advances to employees for
moving, entertainment, travel and other similar
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expenses in the ordinary course of business not to exceed $500,000 in the
aggregate at any time outstanding; and
(i) Investments in joint ventures to the extent that the cash
which the Borrowers invest or are obligated to invest in all such joint
ventures shall not exceed $500,000 in the aggregate;
PROVIDED, HOWEVER, that such Investments will be considered Investments
permitted by this Section 9.3 only if all actions have been taken to the
satisfaction of the Agent to provide to the Agent, for the benefit of the Banks
and the Agent, a first priority perfected security interest in all of such
Investments free of all encumbrances other than Permitted Liens; and PROVIDED
FURTHER that the Investments set forth in clauses (a), (b) and (c) shall only be
permitted to be made or extended when no Loans are outstanding or when such
Investments are in amounts sufficient to repay outstanding Eurodollar Rate Loans
at the end of the Interest Period applicable thereto.
9.4. DISTRIBUTIONS. The Borrowers will not make any Distributions,
except (a) to other Borrowers, (b) in an aggregate amount not to exceed
$250,000, in order to repurchase capital stock of any of the Borrowers held by
any management employees who are leaving the employment of the Borrowers and (c)
dividends on the PIK Preferred Stock to the extent, and only to the extent, paid
in the form of additional shares for PIK Preferred Stock.
9.5. MERGER, CONSOLIDATION AND DISPOSITION OF ASSETS.
9.5.1. MERGERS AND ACQUISITIONS. The Borrowers will not, and
will not permit any of their Subsidiaries to, become a party to any
merger or consolidation, or agree to or effect any asset acquisition or
stock acquisition (other than the acquisition of assets (including new
restaurants) in the ordinary course of business consistent with past
practices) except the merger or consolidation of one or more Borrowers
with and into another Borrower and the acquisition of stock in connection
with Investments permitted by Section 9.3(i).
9.5.2. DISPOSITION OF ASSETS. The Borrowers will not, and will
not permit any of their Subsidiaries to, become a party to or agree to or
effect any disposition of assets, other than (a) the sale of inventory,
the licensing of intellectual property and the disposition of obsolete
assets, in each case in the ordinary course of business consistent with
past practices, (b) subleases of real property and improvements thereon
associated with poor performing restaurants closed by the Borrowers in
the exercise of their reasonable business
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judgment; (c) dispositions in connection with sale leaseback transactions
permitted by Section 9.6, (d) other sales of assets having an aggregate
fair market value not to exceed $1,000,000 in any fiscal year of the
Borrowers, and (e) with the prior written consent of the Agent and the
Majority Banks, other asset sales.
9.6. SALE AND LEASEBACK. The Borrowers will not, and will not permit
any of their Subsidiaries to, enter into any arrangement, directly or
indirectly, whereby any of the Borrowers or any of their Subsidiaries shall sell
or transfer any property owned by it in order then or thereafter to lease such
property or lease other property that such Borrower or such Subsidiary intends
to use for substantially the same purpose as the property being sold or
transferred (a "sale leaseback transaction") except for sale leaseback
transactions entered into with respect to restaurants acquired and opened after
the Closing Date.
9.7. COMPLIANCE WITH ENVIRONMENTAL LAWS. The Borrowers will not, and
will not permit any of their Subsidiaries to, in any manner that would violate
any Environmental Law in any material respect or bring such Real Estate in
violation of any Environmental Law in any material respect, or that would have a
material adverse effect on the business, assets or financial condition of the
Borrowers and their Subsidiaries, considered as a whole (i) use any of the Real
Estate or any portion thereof for the handling, processing, storage or disposal
of Hazardous Substances, (ii) cause or permit to be located on any of the Real
Estate any underground tank or other underground storage receptacle for
Hazardous Substances, (iii) generate any Hazardous Substances on any of the Real
Estate, (iv) conduct any activity at any Real Estate or use any Real Estate in
any manner so as to cause a release (i.e., releasing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, disposing or dumping) or threatened release of Hazardous Substances
on, upon or into the Real Estate or (v) otherwise conduct any activity at any
Real Estate or use any Real Estate.
9.8. INDENTURE AND SENIOR NOTES. Without the prior written consent of
the Agent and the Majority Banks, the Borrowers will not, and will not permit
any of their Subsidiaries to, amend, supplement or otherwise modify the terms of
the Indenture or any of the Senior Notes or prepay, redeem or repurchase any of
the Senior Notes.
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9.9. EMPLOYEE BENEFIT PLANS. None of the Borrowers nor any ERISA
Affiliate will
(a) engage in any "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code which could result in a
material liability for any of the Borrowers or any of their Subsidiaries;
or
(b) permit any Guaranteed Pension Plan to incur an "accumulated
funding deficiency", as such term is defined in Section 302 of ERISA,
whether or not such deficiency is or may be waived; or
(c) fail to contribute to any Guaranteed Pension Plan to an
extent which, or terminate any Guaranteed Pension Plan in a manner which,
could result in the imposition of a lien or encumbrance on the assets of
any of the Borrowers or any of their Subsidiaries pursuant to Section
302(f) or Section 4068 of ERISA; or
(d) amend any Guaranteed Pension Plan in circumstances requiring
the posting of security pursuant to Section 307 of ERISA or Section
401(a)(29) of the Code; or
(e) permit or take any action which would result in the aggregate
benefit liabilities (within the meaning of Section 4001 of ERISA) of all
Guaranteed Pension Plans exceeding the value of the aggregate assets of
such Plans, disregarding for this purpose the benefit liabilities and
assets of any such Plan with assets in excess of benefit liabilities.
9.10. BUSINESS ACTIVITIES; CREATION OF SUBSIDIARIES; BLACK ANGUS OF
IDAHO. The Borrowers will not, and will not permit any of their Subsidiaries
to, engage directly or indirectly (whether through Subsidiaries or otherwise) in
any type of business other than the businesses conducted by them on the Closing
Date and in related businesses. The Borrowers will not, and will not permit any
of their Subsidiaries to, create or permit to exist any Subsidiary of any of the
Borrowers (other than any of the Borrowers or Black Angus of Idaho). Black
Angus of Idaho shall not engage in business of any kind or nature, shall not
have a net worth or assets of more than DE MINIMIS Value and shall not issue
capital stock to any Person other than one or more of the Borrowers.
9.11. FISCAL YEAR. The Borrowers will not, and will not permit any of
their Subsidiaries to, change the date of the end of their fiscal year from that
set forth in Section 7.4.1.
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9.12. TRANSACTIONS WITH AFFILIATES. The Borrowers will not, and will
not permit any of their Subsidiaries to, engage in any transaction with any
Affiliate (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any such
Affiliate or, to the knowledge of the Borrowers, any corporation, partnership,
trust or other entity in which any such Affiliate has a substantial interest or
is an officer, director, trustee or partner, on terms more favorable to such
Person than would have been obtainable on an arm's-length basis in the ordinary
course of business.
9.13. BANK ACCOUNTS. The Borrowers will not, and will not permit any of
their Subsidiaries to, (i) establish any bank accounts other than those Local
Accounts, Interim Concentration Accounts and other accounts, all listed on
SCHEDULE 7.20, without the Agent's prior written consent, (ii) establish any
account other than Local Accounts, Interim Concentration Accounts, payroll
accounts and accounts for payment of employee health or disability benefits,
payroll withholding taxes, worker's compensation obligations or state sales
taxes with Xxxxx Fargo Bank, National Association, or any other financial
institution party to an Agency Account Agreement, (iii) violate directly or
indirectly any Agency Account Agreement or other bank agency or lock box
agreement in favor of the Agent and/or for the benefit of the Banks and the
Agent with respect to such account, or (iv) deposit into any of the payroll
accounts or accounts for payment of employee health or disability benefits,
payroll withholding taxes, worker's compensation obligations or state sales
taxes listed on SCHEDULE 7.20 any amounts in excess of amounts necessary to pay
current payroll, employee health or disability benefits, withholding taxes,
worker's compensation or, as the case may be, state sales tax obligations from
such accounts.
9.14. CAPITALIZATION. None of the Borrowers will designate, establish
or create any new or additional series of capital stock or effect or permit any
change in or amendment of its charter documents (other than a change to increase
the amount of authorized common stock of such Person) or any other document or
instrument pertaining to the terms of the capital stock of such Person,
including the PIK Preferred Stock. None of the Borrowers will redeem, retire or
repurchase any of its capital stock. None of the Borrowers will pay interest or
dividends on the PIK Preferred Stock (other than interest or dividends payable
in the form of additional shares of PIK Preferred Stock), and none of the
Borrowers will convert or exchange the PIK Preferred Stock, whether into
subordinated debentures or otherwise.
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10. FINANCIAL COVENANTS OF THE BORROWERS.
The Borrowers jointly and severally covenant and agree that, so long as
any Loan, Unpaid Reimbursement Obligation, Letter of Credit or Note is
outstanding or any Bank has any obligation to make any Loans or the Agent has
any obligation to issue, extend or renew any Letters of Credit:
10.1. CASH FLOW TO DEBT SERVICE. The Borrowers will not at any time
permit the ratio of Consolidated Cash Flow to Consolidated Debt Service for any
period of four consecutive fiscal quarters ending during any period described in
the table set forth below to be less than the ratio set forth opposite such
period in such table:
Period Ratio
Closing Date - End of third fiscal quarter, 1998 1.00:1
Beginning of fourth fiscal quarter, 1998 - End of third 1.05:1
fiscal quarter, 1999
Beginning of fourth fiscal quarter, 1999 - End of third 1.20:1
fiscal quarter, 2000
Beginning of fourth fiscal quarter, 2000 and thereafter 1.40:1
For any period of four consecutive fiscal quarters ending on or before
the last day of the fourth fiscal quarter, 1998, Consolidated Debt Service shall
be the sum of $19,000,000 PLUS all interest paid or accrued on the Loans during
such period.
10.2. INTEREST COVERAGE. The Borrowers will not permit at any time the
ratio of (i) EBITDA for any period of four consecutive fiscal quarters ending
during any period described in the table set forth below, to (ii) Consolidated
Total Net Interest Expense for such period, to be less than the ratio set forth
opposite such period in such table:
Period Ratio
Closing Date - End of third fiscal quarter, 1998 1.50:1
Beginning of fourth fiscal quarter, 1998 - End of third 1.60:1
fiscal quarter, 1999
Beginning of fourth fiscal quarter, 1999 - End of third 1.75:1
fiscal quarter, 2000
Beginning of fourth fiscal quarter, 2000 and thereafter 2.00:1
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For any period of four consecutive fiscal quarters ending on or before
the last day of the fourth fiscal quarter, 1998, Consolidated Total Net Interest
Expense shall be the sum of $19,000,000 PLUS all interest paid or accrued on the
Loans during such period.
10.3. CONSOLIDATED NET FUNDED DEBT TO EBITDA. The Borrowers will not
permit the ratio of Consolidated Net Funded Debt to EBITDA at any time in any
fiscal quarter ending during any period described in the table set forth below
to exceed the ratio set forth opposite such period in such table:
Period Rate
Closing Date - End of third fiscal quarter, 1998 5.75:1
Beginning of fourth fiscal quarter, 1998 - End of third 5.00:1
fiscal quarter, 1999
Beginning of fourth fiscal quarter, 1999 - End of third 4.25:1
fiscal quarter, 2000
Beginning of fourth fiscal quarter, 2000 and thereafter 3.50:1
11. CLOSING CONDITIONS.
The obligations of the Banks to make the initial Loan and of the Agent to
issue any initial Letters of Credit shall be subject to the satisfaction of the
following conditions precedent.
11.1. LOAN DOCUMENTS ETC.
11.1.1. LOAN DOCUMENTS. Each of the Loan Documents shall have
been duly executed and delivered by the respective parties thereto, shall
be in full force and effect and shall be in form and substance
satisfactory to each of the Banks. Each Bank shall have received a fully
executed copy of each such document.
11.1.2. RECAPITALIZATION DOCUMENTS. Each of the Recapitalization
Documents shall have been duly executed and delivered by the respective
parties thereto, shall be in full force and effect and shall be in form
and substance satisfactory to each of the Banks. Each Bank shall have
received a fully executed copy of each such document.
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11.2. CERTIFIED COPIES OF CHARTER DOCUMENTS. Each of the Banks shall
have received from each of the Borrowers and each of its Subsidiaries a copy,
certified by a duly authorized officer of such Person to be true and complete on
the Closing Date, of each of (i) its charter or other incorporation documents as
in effect on such date of certification and (ii) its by-laws as in effect on
such date.
11.3. CORPORATE ACTION. All corporate action necessary for the valid
execution, delivery and performance by each of the Borrowers and each of its
Subsidiaries of this Credit Agreement and the other Loan Documents to which it
is or is to become a party shall have been duly and effectively taken, and
evidence thereof satisfactory to the Banks shall have been provided to each of
the Banks.
11.4. INCUMBENCY CERTIFICATE. Each of the Banks shall have received
from each of the Borrowers and each of its Subsidiaries an incumbency
certificate, dated as of the Closing Date, signed by a duly authorized officer
of such Borrower or such Subsidiary, and giving the name and bearing a specimen
signature of each individual who shall be authorized: (i) to sign, in the name
and on behalf of each of such Borrower and of such Subsidiary, each of the Loan
Documents and Recapitalization Documents to which such Borrower or such
Subsidiary is or is to become a party; (ii) in the case of the Borrowers, to
make Loan Requests and Conversion Requests and to apply for Letters of Credit;
and (iii) to give notices and to take other action on its behalf under the Loan
Documents.
11.5. VALIDITY OF LIENS. The Security Documents shall be effective to
create, upon the filing of duly executed Uniform Commercial Code financing
statements and the Mortgages, in favor of the Collateral Agent for the benefit
of the Secured Parties a legal, valid and enforceable first (except for
Permitted Liens entitled to priority under applicable law) security interest in
and lien upon the Collateral. All filings (except for the filing of Uniform
Commercial Code financing statements, which filings are to be made immediately
following the Closing Date), recordings (except for the recordings of the
Mortgages, which recordings are to be made immediately following the Closing
Date), deliveries of instruments and other actions necessary or desirable in the
opinion of the Agent to protect and preserve such security interests shall have
been duly effected. The Agent shall have received evidence thereof in form and
substance satisfactory to the Agent.
11.6. UCC SEARCH RESULTS. The Agent shall have received from each of
the Borrowers and its Subsidiaries the results of UCC searches
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with respect to the Collateral, indicating no liens other than Permitted Liens
and otherwise in form and substance satisfactory to the Agent.
11.7. SURVEY AND TAXES. The Agent shall have received (i) an updated
Survey of each Mortgaged Property together with a Surveyor Certificate relating
thereto, if requested by the Agent, and (ii) evidence of payment of real estate
taxes and municipal charges on all Real Estate not delinquent on or before the
Closing Date.
11.8. TITLE INSURANCE. The Agent shall have received a Title Policy
covering each Mortgaged Property (or commitments to issue such policies, with
all conditions to issuance of the Title Policy deleted by an authorized agent of
the Title Insurance Company) together with proof of payment of all fees and
premiums for such policies, from the Title Insurance Company and in amounts
satisfactory to the Agent, insuring the interest of the Collateral Agent and
each of the Secured Parties as mortgagee under the Mortgages.
11.9. LANDLORD CONSENTS. The Borrowers and their Subsidiaries shall
have delivered to the Agent all consents required for the Agent to receive, as
part of the Security Documents, a collateral assignment of each material
leasehold of personal property, and a mortgage of agreed upon leaseholds of real
property, together in each case with such estoppel certificates as the Agent may
request.
11.10. CERTIFICATES OF INSURANCE. The Agent shall have received (i) a
certificate of insurance from an independent insurance broker dated as of the
Closing Date, identifying insurers, types of insurance, insurance limits, and
policy terms, and otherwise describing the insurance obtained in accordance with
the provisions of the Security Agreements and (ii) certified copies of all
policies evidencing such insurance (or certificates therefor signed by the
insurer or an agent authorized to bind the insurer).
11.11. AGENCY ACCOUNT AGREEMENTS. The Borrowers shall have established
the BKB Concentration Account, and the Agent shall have received an Agency
Account Agreement duly executed by each depository institution with an Interim
Concentration Account.
11.12. HAZARDOUS WASTE ASSESSMENTS. To the extent prepared for the
Borrowers and delivered to the Noteholders, the Agent shall have received
hazardous waste site assessments from environmental engineers and in form and
substance satisfactory to the Agent, covering all Real Estate and all other real
property in respect of which the Borrowers or any of their Subsidiaries may have
material liability, whether contingent or otherwise, for dumping or disposal of
Hazardous Substances.
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11.13. SOLVENCY CERTIFICATE. Each of the Banks shall have received an
officer's certificate of the Borrowers dated as of the Closing Date as to the
solvency of the Borrowers and their Subsidiaries following the consummation of
the transactions contemplated herein and in form and substance satisfactory to
the Banks.
11.14. OPINIONS OF COUNSEL. Each of the Banks and the Agent shall have
received a favorable legal opinion addressed to the Banks and the Agent, dated
as of the Closing Date, in form and substance satisfactory to the Banks and the
Agent, from:
(a) Simpson, Thacher & Xxxxxxxx, counsel to the Borrowers and
their Subsidiaries;
(b) local counsel to the Borrowers and their Subsidiaries in
California and Texas;
(c) Xxxxxxx X. Xxxxxx, General Counsel of the Borrowers; and
(d) local counsel to the Borrowers and their Subsidiaries in
Texas, California and Florida with respect to real estate matters.
11.15. PAYMENT OF FEES. The Borrower shall have paid to the Agent the
closing fee pursuant to Section 5.1.
11.16. PAYOFF LETTER. The Agent shall have received a copy of a payoff
letter from Bankers Trust Company, indicating the amount of the obligations of
one or more of the Borrowers to Bankers Trust Company and the holders of the
Subordinated Notes to be discharged on the Closing Date and an acknowledgment by
Bankers Trust Company that upon receipt of such funds, all Indebtedness of any
of the Borrowers to it and the holders of the Subordinated Notes shall have been
repaid in full and that it will forthwith execute and deliver to the Collateral
Agent for filing all termination statements and take such other actions as may
be necessary to discharge all mortgages, deeds of trust and security interests
granted by any of the Borrowers or any of their Subsidiaries to Bankers Trust
Company or any of the holders of the Subordinated Notes.
11.17. RECAPITALIZATION. The closing of the Recapitalization shall have
occurred pursuant to the Recapitalization Documents, and the Agent and the Banks
shall be satisfied with the Borrowers' capital structure and the terms and
conditions of the Recapitalization Documents. The Agent shall have received
from the Borrowers copies, duly certified by the Borrowers to be true, accurate
and complete on the Closing Date, of each of the Recapitalization Documents and
of all corporate and other action
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taken by each of the Borrowers to authorize (a) its execution and delivery of
each of the Recapitalization Documents to which it is or is to become a party
and (b) its performance of all of its agreements and obligations under each of
such documents. The amount of transaction costs and related expenses to be paid
by the Borrowers in connection with the Recapitalization shall not exceed
$12,500,000.
11.18. PROJECTED USAGE OF REVOLVING CREDIT FACILITY; CLOSING BALANCE
SHEET, ETC. The Borrowers shall have provided to the Agent a statement,
satisfactory in form and substance to the Agent, of their projected usage of the
revolving credit facility contemplated hereby for the twelve (12) month period
following the Closing Date, and the Agent shall be satisfied with such statement
of projected usage. Among other things, the projected usage of the facility
contemplated hereby shall demonstrate that the Borrowers will have sufficient
proceeds from the issuance of the Senior Notes and PIK Preferred Stock to repay
all existing Indebtedness of the Borrowers, including Indebtedness owing to
Bankers Trust Company and the holders of the Subordinated Notes (but excluding
Indebtedness in respect of Capitalized Leases not to exceed $8,700,000 in
aggregate amount and other Indebtedness listed on SCHEDULE 9.1 not to exceed
$1,700,000 in aggregate amount) and all expenses, fees and other transaction
costs arising from this Credit Agreement, the other Loan Documents, the
Recapitalization and the transactions contemplated hereby and thereby. The
Agent shall also have received a Closing Date balance sheet, together with a
listing of sources and uses of funds, satisfactory in form and substance to the
Agent and the Banks, and showing the effects of the refinancing and
recapitalization contemplated hereby and the Borrowers' compliance on a PRO
FORMA basis with the covenants contained in Section 10 hereof.
11.19. CERTIFICATES REGARDING FINANCING STATEMENTS. The Borrowers shall
have delivered to the Agent such certificates regarding Uniform Commercial Code
financing statements as the Agent shall have requested, each in form and
substance satisfactory to the Agent.
11.20. POST-CLOSING UNDERTAKINGS. The conditions, actions and items set
forth in the Post-Closing Letter shall not be deemed waived by virtue of the
fact that they are not completed on the Closing Date.
12. CONDITIONS TO ALL BORROWINGS.
The obligations of the Banks to make any Loan and of the Agent to issue,
extend or renew any Letter of Credit, in each case whether on or
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after the Closing Date, shall also be subject to the satisfaction of the
following conditions precedent:
12.1. REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties of any of the Borrowers and any of their
Subsidiaries contained in this Credit Agreement, the other Loan Documents or in
any document or instrument delivered pursuant to or in connection with this
Credit Agreement shall be true as of the date as of which they were made and
shall also be true at and as of the time of the making of such Loan or the
issuance, extension or renewal of such Letter of Credit, with the same effect as
if made at and as of that time (except to the extent of changes resulting from
transactions contemplated or permitted by this Credit Agreement and the other
Loan Documents and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and to the extent that
such representations and warranties relate expressly to an earlier date) and no
Default or Event of Default shall have occurred and be continuing.
12.2. NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Bank would make it illegal for such Bank to make such Loan or to
participate in the issuance, extension or renewal of such Letter of Credit or in
the reasonable opinion of the Agent would make it illegal for the Agent to
issue, extend or renew such Letter of Credit.
12.3. GOVERNMENTAL REGULATION. Each Bank shall have received such
statements in substance and form reasonably satisfactory to such Bank as such
Bank shall require for the purpose of compliance with any applicable regulations
of the Comptroller of the Currency or the Board of Governors of the Federal
Reserve System.
12.4. PROCEEDINGS AND DOCUMENTS. All proceedings in connection with the
transactions contemplated by this Credit Agreement, the other Loan Documents and
all other documents incident thereto shall be satisfactory in substance and in
form to the Agent and the Agent's Special Counsel, and the Agent and such
counsel shall have received all information and such counterpart originals or
certified or other copies of such documents as the Agent may reasonably request.
13. EVENTS OF DEFAULT; ACCELERATION; ETC.
13.1. EVENTS OF DEFAULT AND ACCELERATION. If any of the following
events ("Events of Default" or, if the giving of notice or the lapse
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of time or both is required, then, prior to such notice or lapse of time,
"Defaults") shall occur and be continuing:
(a) the Borrowers shall fail to pay any principal of the Loans or
any Reimbursement Obligation when the same shall become due and payable,
whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
(b) the Borrowers or any of their Subsidiaries shall fail to pay
any interest on the Loans, the commitment fee, any Letter of Credit Fee,
the Agent's fee, or other sums due hereunder or under any of the other
Loan Documents, within two (2) days following any date when the same
shall become due and payable, whether at the stated date of maturity or
any accelerated date of maturity or at any other date fixed for payment;
(c) the Borrowers shall fail to comply with any of its covenants
contained in Sections 8.1, 8.4, 8.5, 8.6, 8.7, 8.12, 8.14, 8.16, 9 or 10
or any of the covenants contained in any of the Mortgages;
(d) the Borrowers or any of their Subsidiaries shall fail to
perform any term, covenant or agreement contained herein or in any of the
other Loan Documents (other than those specified elsewhere in this
Section 13.1) for fifteen (15) days after written notice of such failure
has been given to the Borrowers by the Agent;
(e) any representation or warranty of any of the Borrowers or any
of its Subsidiaries in this Credit Agreement or any of the other Loan
Documents or in any other document or instrument delivered pursuant to or
in connection with this Credit Agreement shall prove to have been false
in any material respect upon the date when made or deemed to have been
made or repeated;
(f) any of the Borrowers or any of their Subsidiaries shall fail
to pay when the same shall become due and payable (or within any
applicable period of grace), whether at the stated date of maturity or
any accelerated date of maturity or at any other date fixed for payment,
any obligation for borrowed money or credit received or in respect of any
Capitalized Leases or any synthetic lease referred to in clause (vi) of
the definition of Indebtedness, which obligations equal or exceed
$1,000,000, or fail to observe or perform any material term, covenant or
agreement contained in any agreement by which it is bound, evidencing or
securing borrowed money or credit received or in respect of any
Capitalized Leases or any synthetic lease referred to in clause (vi) of
the definition of
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Indebtedness, which obligations equal or exceed $1,000,000, for such
period of time as would permit (assuming the giving of appropriate notice
if required) the holder or holders thereof or of any obligations issued
thereunder to accelerate the maturity thereof;
(g) any of the Borrowers or any of their Subsidiaries shall make
an assignment for the benefit of creditors, or admit in writing its
inability to pay or generally fail to pay its debts as they mature or
become due, or shall petition or apply for the appointment of a trustee
or other custodian, liquidator or receiver of any of the Borrowers or any
of their Subsidiaries or of any substantial part of the assets of the
Borrowers or any of their Subsidiaries or shall commence any case or
other proceeding relating to the Borrowers or any of their Subsidiaries
under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction, now or hereafter in effect, or shall take any action to
authorize or in furtherance of any of the foregoing, or if any such
petition or application shall be filed or any such case or other
proceeding shall be commenced against the Borrowers or any of their
Subsidiaries and any of the Borrowers or any of their Subsidiaries shall
indicate approval thereof, consent thereto or acquiescence therein or
such petition or application shall not have been dismissed within
forty-five (45) days following the filing thereof;
(h) a decree or order is entered appointing any such trustee,
custodian, liquidator or receiver, or adjudicating the Borrowers or any
of their Subsidiaries bankrupt or insolvent, or approving a petition in
any such case or other proceeding, or a decree or order for relief is
entered in respect of any of the Borrowers or any Subsidiaries in an
involuntary case under federal bankruptcy laws as now or hereafter
constituted;
(i) there shall remain in force, undischarged, unsatisfied and
unstayed, for more than thirty consecutive days, any final judgment
against any of the Borrowers or any of their Subsidiaries that, with
other outstanding final judgments, undischarged, against any of the
Borrowers or any of their Subsidiaries exceeds in the aggregate
$1,000,000;
(j) the holders of all or any part of the Senior Notes shall
accelerate the maturity of all or any part of the Senior Notes or the
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Senior Notes or the PIK Preferred Stock shall be prepaid, redeemed or
repurchased in whole or in part;
(k) if any of the Loan Documents shall be canceled, terminated,
revoked or rescinded or the Collateral Agent's security interests,
mortgages or liens for the benefit of the Agent and the Banks in a
substantial portion of the Collateral shall cease to be perfected, or
shall cease to have the priority contemplated by the Security Documents,
in each case otherwise than in accordance with the terms thereof or with
the express prior written agreement, consent or approval of the Banks, or
any action at law, suit or in equity or other legal proceeding to cancel,
revoke or rescind any of the Loan Documents shall be commenced by or on
behalf of any of the Borrowers or any of their Subsidiaries party thereto
or any of their respective stockholders, or any court or any other
governmental or regulatory authority or agency of competent jurisdiction
shall make a determination that, or issue a judgment, order, decree or
ruling to the effect that, any one or more of the Loan Documents is
illegal, invalid or unenforceable in accordance with the terms thereof;
(l) any of the Borrowers or any ERISA Affiliate incurs any
liability to the PBGC or a Guaranteed Pension Plan pursuant to Title IV
of ERISA in an aggregate amount exceeding $1,000,000, or the Borrowers or
any ERISA Affiliate is assessed withdrawal liability pursuant to Title IV
of ERISA by a Multiemployer Plan requiring aggregate annual payments
exceeding $1,000,000, or any of the following occurs with respect to a
Guaranteed Pension Plan: (i) an ERISA Reportable Event, or a failure to
make a required installment or other payment (within the meaning of
Section 302(f)(1) of ERISA), PROVIDED that the Agent determines in its
reasonable discretion that such event (A) could be expected to result in
liability of the Borrowers or any of their Subsidiaries to the PBGC or
such Guaranteed Pension Plan in an aggregate amount exceeding $1,000,000
and (B) could constitute grounds for the termination of such Guaranteed
Pension Plan by the PBGC, for the appointment by the appropriate United
States District Court of a trustee to administer such Guaranteed Pension
Plan or for the imposition of a lien in favor of such Guaranteed Pension
Plan; or (ii) the appointment by a United States District Court of a
trustee to administer such Guaranteed Pension Plan; or (iii) the
institution by the PBGC of proceedings to terminate such Guaranteed
Pension Plan;
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(m) any of the Borrowers or any of their Subsidiaries shall be
enjoined, restrained or in any way prevented by the order of any court or
any administrative or regulatory agency from conducting any material part
of the business of the Borrowers and their Subsidiaries, considered as a
whole, and such order shall continue in effect for more than thirty (30)
days;
(n) there shall occur any material damage to, or loss, theft or
destruction of, any Collateral, whether or not insured, or any strike,
lockout, labor dispute, embargo, condemnation, act of God or public
enemy, or other casualty, which in any such case causes the cessation or
substantial curtailment of revenue producing activities at any facility
of any of the Borrowers or any of their Subsidiaries if such event or
circumstance is not covered by business interruption insurance and would
have a material adverse effect on the business or financial condition of
the Borrowers and their Subsidiaries, considered as a whole;
(o) there shall occur the loss, suspension or revocation of, or
failure to renew, any license or permit now held or hereafter acquired by
any of the Borrowers or any of their Subsidiaries if such loss,
suspension, revocation or failure to renew would have a material adverse
effect on the business or financial condition of the Borrowers and their
Subsidiaries, considered as a whole;
(p) any of the Borrowers or any of their Subsidiaries or any of
the officers or directors of any of the Borrowers or any of their
Subsidiaries shall be indicted for a state or federal crime, or any civil
or criminal action shall otherwise have been brought or threatened
against any of the Borrowers or any of their Subsidiaries, a punishment
for which in any such case could include the forfeiture of any assets of
such Borrower or such Subsidiary having a fair market value in excess of
$1,000,000; or
(q) (i) Xxxxx X. Xxxxxxx, Xxxxx Xxxxxxx, and/or other management
shareholders of Holdings, the shares of whom Xxxxx X. Xxxxxxx or Xxxxx
Xxxxxxx has the power to vote, collectively shall at any time, legally or
beneficially, own less than fifty-one percent (51%) of all shares of the
common stock of Holdings, as adjusted pursuant to any stock split, stock
dividend or recapitalization or reclassification of the capital of
Holdings, (ii) Holdings, Xxxxx X. Xxxxxxx, Xxxxx Xxxxxxx, and/or other
management shareholders of the Company the shares of whom Xxxxx X.
Xxxxxxx or Xxxxx Xxxxxxx has the power to vote, collectively shall at any
time, legally
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or beneficially, own less than fifty-one percent (51%) of all shares of
the common stock of ARG, as adjusted pursuant to any stock split, stock
dividend or recapitalization or reclassification of the capital of ARG,
or (iii) ARG shall at any time legally or beneficially own less than 100%
of the common stock, as adjusted pursuant to any stock split, stock
dividend or recapitalization or reclassification of the capital stock of
each of the other Borrowers, or (iv) during any period of two consecutive
years, Continuing Directors cease for any reason to constitute a majority
of the Board of Directors of ARG then still in office;
then, and in any such event, so long as the same may be continuing, the Agent
may, and upon the request of the Majority Banks shall, by notice in writing to
the Borrowers declare all amounts owing with respect to this Credit Agreement,
the Notes and the other Loan Documents and all Reimbursement Obligations to be,
and they shall thereupon forthwith become, immediately due and payable without
presentment, demand, protest or other notice of any kind, all of which are
hereby expressly waived by the Borrowers; PROVIDED that in the event of any
Event of Default specified in Sections 13.1(g), 13.1(h) or 13.1(j), all such
amounts shall become immediately due and payable automatically and without any
requirement of notice from the Agent or any Bank.
13.2. TERMINATION OF COMMITMENTS. If any one or more of the Events of
Default specified in Section 13.1(g), Section 13.1(h) or Section 13.1(j) shall
occur, any unused portion of the credit hereunder shall forthwith terminate and
each of the Banks shall be relieved of all further obligations to make Loans to
the Borrowers and the Agent shall be relieved of all further obligations to
issue, extend or renew Letters of Credit. If any other Event of Default shall
have occurred and be continuing, the Agent may and, upon the request of the
Majority Banks, shall, by notice to the Borrowers, terminate the unused portion
of the credit hereunder, and upon such notice being given such unused portion of
the credit hereunder shall terminate immediately and each of the Banks shall be
relieved of all further obligations to make Loans and the Agent shall be
relieved of all further obligations to issue, extend or renew Letters of Credit.
No termination of the credit hereunder shall relieve any of the Borrowers or any
of their Subsidiaries of any of the Obligations.
13.3. REMEDIES. In case any one or more of the Events of Default shall
have occurred and be continuing, and whether or not the Banks shall have
accelerated the maturity of the Loans pursuant to Section 13.1, each Bank, if
owed any amount with respect to the Loans or the Reimbursement Obligations, may,
with the consent of the Majority Banks but not
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otherwise, proceed to protect and enforce its rights by suit in equity, action
at law or other appropriate proceeding, whether for the specific performance of
any covenant or agreement contained in this Credit Agreement and the other Loan
Documents or any instrument pursuant to which the Obligations to such Bank are
evidenced, including as permitted by applicable law the obtaining of the EX
PARTE appointment of a receiver, and, if such amount shall have become due, by
declaration or otherwise, proceed to enforce the payment thereof or any other
legal or equitable right of such Bank. No remedy herein conferred upon any Bank
or the Agent or the holder of any Note or purchaser of any Letter of Credit
Participation is intended to be exclusive of any other remedy and each and every
remedy shall be cumulative and shall be in addition to every other remedy given
hereunder or now or hereafter existing at law or in equity or by statute or any
other provision of law.
13.4. DISTRIBUTION OF COLLATERAL PROCEEDS. In the event that any
Default or Event of Default has occurred and is continuing and the Agent or any
Bank, as the case may be, receives any monies in connection with the enforcement
of any of the Security Documents, or otherwise with respect to the realization
upon any of the Collateral, such monies shall be distributed for application as
follows:
(a) First, to the payment of, or (as the case may be) the
reimbursement of the Agent for or in respect of all reasonable costs,
expenses, disbursements and losses which shall have been incurred or
sustained by the Agent in connection with the collection of such monies
by the Agent, for the exercise, protection or enforcement by the Agent of
all or any of the rights, remedies, powers and privileges of the Agent
under this Credit Agreement or any of the other Loan Documents or in
respect of the Collateral or in support of any provision of adequate
indemnity to the Agent against any taxes or liens which by law shall
have, or may have, priority over the rights of the Agent to such monies;
(b) Second, to all other Obligations in such order or preference
as the Agent may determine; PROVIDED, HOWEVER, that (i) distributions
shall be made (A) PARI PASSU among Obligations with respect to the
Agent's fee payable pursuant to Section 5.2 and all other Obligations and
(B) with respect to each type of Obligation owing to the Banks, such as
interest, principal, fees and expenses, among the Banks PRO RATA, and
(ii) the Agent may in its discretion make proper allowance to take into
account any Obligations not then due and payable;
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(c) Third, upon payment and satisfaction in full or other
provisions for payment in full satisfactory to the Banks and the Agent of
all of the Obligations, to the payment of the Senior Notes and any other
obligations required to be paid pursuant to Section 9-504(1)(c) of the
Uniform Commercial Code of the Commonwealth of Massachusetts; and
(d) Fourth, the excess, if any, shall be returned to the
Borrowers or to such other Persons as are entitled thereto.
14. SETOFF.
Regardless of the adequacy of any collateral, during the continuance of
any Event of Default, any deposits or other sums credited by or due from any of
the Banks to the Borrowers and any securities or other property of the Borrowers
in the possession of such Bank may be applied to or set off by such Bank against
the payment of Obligations and any and all other liabilities, direct, or
indirect, absolute or contingent, due or to become due, now existing or
hereafter arising, of the Borrowers to such Bank. Each of the Banks agrees with
each other Bank that (i) if an amount to be set off is to be applied to
Indebtedness of the Borrowers to such Bank, other than Indebtedness evidenced by
the Notes held by such Bank or constituting Reimbursement Obligations owed to
such Bank, such amount shall be applied ratably to such other Indebtedness and
to the Indebtedness evidenced by all such Notes held by such Bank or
constituting Reimbursement Obligations owed to such Bank, and (ii) if such Bank
shall receive from the Borrowers, whether by voluntary payment, exercise of the
right of setoff, counterclaim, cross action, enforcement of the claim evidenced
by the Notes held by, or constituting Reimbursement Obligations owed to, such
Bank by proceedings against the Borrowers at law or in equity or by proof
thereof in bankruptcy, reorganization, liquidation, receivership or similar
proceedings, or otherwise, and shall retain and apply to the payment of the Note
or Notes held by, or Reimbursement Obligations owed to, such Bank any amount in
excess of its ratable portion of the payments received by all of the Banks with
respect to the Notes held by, and Reimbursement Obligations owed to, all of the
Banks, such Bank will make such disposition and arrangements with the other
Banks with respect to such excess, either by way of distribution, PRO TANTO
assignment of claims, subrogation or otherwise as shall result in each Bank
receiving in respect of the Notes held by it or Reimbursement Obligations owed
it, its proportionate payment as contemplated by this Credit Agreement; PROVIDED
that if all or any part of such excess payment is thereafter recovered from such
Bank,
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such disposition and arrangements shall be rescinded and the amount restored to
the extent of such recovery, but without interest.
15. THE AGENT.
15.1. AUTHORIZATION.
(a) The Agent is authorized to take such action on behalf of each
of the Banks and to exercise all such powers as are hereunder and under
any of the other Loan Documents and any related documents delegated to
the Agent, together with such powers as are reasonably incident thereto,
PROVIDED that no duties or responsibilities not expressly assumed herein
or therein shall be implied to have been assumed by the Agent.
(b) The relationship between the Agent and each of the Banks is
that of an independent contractor. The use of the term "Agent" is for
convenience only and is used to describe, as a form of convention, the
independent contractual relationship between the Agent and each of the
Banks. Nothing contained in this Credit Agreement nor the other Loan
Documents shall be construed to create an agency, trust or other
fiduciary relationship between the Agent and any of the Banks.
(c) As an independent contractor empowered by the Banks to
exercise certain rights and perform certain duties and responsibilities
hereunder and under the other Loan Documents, the Agent is nevertheless a
"representative" of the Banks, as that term is defined in Article 1 of
the Uniform Commercial Code, for purposes of actions for the benefit of
the Banks and the Agent with respect to all collateral security and
guaranties contemplated by the Loan Documents. Such actions include the
designation of the Agent as "secured party", "mortgagee" or the like on
all financing statements and other documents and instruments, whether
recorded or otherwise, relating to the attachment, perfection, priority
or enforcement of any security interests, mortgages or deeds of trust in
collateral security intended to secure the payment or performance of any
of the Obligations, all for the benefit of the Banks and the Agent.
15.2. EMPLOYEES AND AGENTS. The Agent may exercise its powers and
execute its duties by or through employees or agents and shall be entitled to
take, and to rely on, advice of counsel concerning all matters pertaining to its
rights and duties under this Credit Agreement and the other Loan Documents. The
Agent may utilize the services of such
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Persons as the Agent in its sole discretion may reasonably determine, and all
reasonable fees and expenses of any such Persons shall be paid by the Borrowers.
15.3. NO LIABILITY. Neither the Agent nor any of its shareholders,
directors, officers or employees nor any other Person assisting them in their
duties nor any agent or employee thereof, shall be liable for any waiver,
consent or approval given or any action taken, or omitted to be taken, in good
faith by it or them hereunder or under any of the other Loan Documents, or in
connection herewith or therewith, or be responsible for the consequences of any
oversight or error of judgment whatsoever, except that the Agent or such other
Person, as the case may be, may be liable for losses due to its willful
misconduct or gross negligence.
15.4. NO REPRESENTATIONS.
15.4.1. GENERAL. The Agent shall not be responsible for the
execution or validity or enforceability of this Credit Agreement, the
Notes, the Letters of Credit, any of the other Loan Documents or any
instrument at any time constituting, or intended to constitute,
collateral security for the Notes, or for the value of any such
collateral security or for the validity, enforceability or collectability
of any such amounts owing with respect to the Notes, or for any recitals
or statements, warranties or representations made herein or in any of the
other Loan Documents or in any certificate or instrument hereafter
furnished to it by or on behalf of any of the Borrowers or any of their
Subsidiaries, or be bound to ascertain or inquire as to the performance
or observance of any of the terms, conditions, covenants or agreements
herein or in any instrument at any time constituting, or intended to
constitute, collateral security for the Notes or to inspect any of the
properties, books or records of any of the Borrowers or any of their
Subsidiaries. The Agent shall not be bound to ascertain whether any
notice, consent, waiver or request delivered to it by any of the
Borrowers or any holder of any of the Notes shall have been duly
authorized or is true, accurate and complete. The Agent has not made nor
does it now make any representations or warranties, express or implied,
nor does it assume any liability to the Banks, with respect to the credit
worthiness or financial conditions of any of the Borrowers or any of
their Subsidiaries. Each Bank acknowledges that it has, independently
and without reliance upon the Agent or any other Bank, and based upon
such information and documents as it has deemed appropriate, made its own
credit analysis and decision to enter into this Credit Agreement.
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15.4.2. CLOSING DOCUMENTATION, ETC. For purposes of determining
compliance with the conditions set forth in Section 11, each Bank that
has executed this Credit Agreement shall be deemed to have consented to,
approved or accepted, or to be satisfied with, each document and matter
either sent, or made available, by the Agent to such Bank for consent,
approval, acceptance or satisfaction, or required thereunder to be to be
consent to or approved by or acceptable or satisfactory to such Bank,
unless an officer of the Agent active upon the Borrowers' account shall
have received notice from such Bank prior to the Closing Date specifying
such Bank's objection thereto and such objection shall not have been
withdrawn by notice to the Agent to such effect on or prior to the
Closing Date.
15.5. PAYMENTS.
15.5.1. PAYMENTS TO AGENT. A payment by the Borrowers to the
Agent hereunder or any of the other Loan Documents for the account of any
Bank shall constitute a payment to such Bank. The Agent agrees promptly
to distribute to each Bank such Bank's PRO RATA share of payments
received by the Agent for the account of the Banks except as otherwise
expressly provided herein or in any of the other Loan Documents.
15.5.2. DISTRIBUTION BY AGENT. If in the opinion of the Agent
the distribution of any amount received by it in such capacity hereunder,
under the Notes or under any of the other Loan Documents might involve it
in liability, it may refrain from making distribution until its right to
make distribution shall have been adjudicated by a court of competent
jurisdiction. If a court of competent jurisdiction shall adjudge that
any amount received and distributed by the Agent is to be repaid, each
Person to whom any such distribution shall have been made shall either
repay to the Agent its proportionate share of the amount so adjudged to
be repaid or shall pay over the same in such manner and to such Persons
as shall be determined by such court.
15.5.3. DELINQUENT BANKS. Notwithstanding anything to the
contrary contained in this Credit Agreement or any of the other Loan
Documents, any Bank that fails (i) to make available to the Agent its PRO
RATA share of any Loan or to purchase any Letter of Credit Participation
or (ii) to comply with the provisions of Section 14 with respect to
making dispositions and arrangements with the other Banks, where such
Bank's share of any payment received, whether
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by setoff or otherwise, is in excess of its PRO RATA share of such
payments due and payable to all of the Banks, in each case as, when and
to the full extent required by the provisions of this Credit Agreement,
shall be deemed delinquent (a "Delinquent Bank") and shall be deemed a
Delinquent Bank until such time as such delinquency is satisfied. A
Delinquent Bank shall be deemed to have assigned any and all payments due
to it from the Borrowers, whether on account of outstanding Loans, Unpaid
Reimbursement Obligations, interest, fees or otherwise, to the remaining
non-delinquent Banks for application to, and reduction of, their
respective PRO RATA shares of all outstanding Loans and Unpaid
Reimbursement Obligations. The Delinquent Bank hereby authorizes the
Agent to distribute such payments to the nondelinquent Banks in
proportion to their respective PRO RATA shares of all outstanding Loans
and Unpaid Reimbursement Obligations. A Delinquent Bank shall be deemed
to have satisfied in full a delinquency when and if, as a result of
application of the assigned payments to all outstanding Loans and Unpaid
Reimbursement Obligations of the nondelinquent Banks, the Banks'
respective PRO RATA shares of all outstanding Loans and Unpaid
Reimbursement Obligations have returned to those in effect immediately
prior to such delinquency and without giving effect to the nonpayment
causing such delinquency.
15.6. HOLDERS OF NOTES. The Agent may deem and treat the payee of any
Note or the purchaser of any Letter of Credit Participation as the absolute
owner or purchaser thereof for all purposes hereof until it shall have been
furnished in writing with a different name by such payee or by a subsequent
holder, assignee or transferee.
15.7. INDEMNITY. The Banks ratably agree hereby to indemnify and hold
harmless the Agent and its affiliates from and against any and all claims,
actions and suits (whether groundless or otherwise), losses, damages, costs,
expenses (including any expenses for which the Agent or such affiliate has not
been reimbursed by the Borrowers as required by Section 16), and liabilities of
every nature and character arising out of or related to this Credit Agreement,
the Notes, or any of the other Loan Documents or the transactions contemplated
or evidenced hereby or thereby, or the Agent's actions taken hereunder or
thereunder, except to the extent that any of the same shall be directly caused
by the Agent's willful misconduct or gross negligence.
15.8. AGENT AS BANK. In its individual capacity, BKB shall have the
same obligations and the same rights, powers and privileges in respect
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to its Commitment and the Loans made by it, and as the holder of any of the
Notes and as the purchaser of any Letter of Credit Participations, as it would
have were it not also the Agent.
15.9. RESIGNATION. The Agent may resign at any time by giving sixty
(60) days' prior written notice thereof to the Banks and the Borrowers. Upon
any such resignation, the Majority Banks shall have the right to appoint a
successor Agent. Unless a Default or Event of Default shall have occurred and
be continuing, such successor Agent shall be reasonably acceptable to the
Borrowers. If no successor Agent shall have been so appointed by the Majority
Banks and shall have accepted such appointment within thirty (30) days after the
retiring Agent's giving of notice of resignation, then the retiring Agent may,
on behalf of the Banks, appoint a successor Agent, which shall be a financial
institution having a rating of not less than A or its equivalent by Standard &
Poor's Corporation. Upon the acceptance of any appointment as Agent hereunder
by a successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation, the provisions of this
Credit Agreement and the other Loan Documents shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while it
was acting as Agent.
16. EXPENSES AND INDEMNIFICATION.
16.1. EXPENSES. The Borrowers jointly and severally agree to pay (i)
the reasonable costs of the Agent and/or the Agent's Special Counsel producing
and reproducing this Credit Agreement, the other Loan Documents and the other
agreements and instruments mentioned herein, (ii) any taxes (including any
interest and penalties in respect thereto) payable by the Agent or any of the
Banks (other than taxes based upon the Agent's or any Bank's net income or
profits) on or with respect to the transactions contemplated by this Credit
Agreement (the Borrowers hereby agreeing to indemnify the Agent and each Bank
with respect thereto), (iii) the reasonable fees, expenses and disbursements of
the Agent's Special Counsel or any local counsel to the Agent incurred in
connection with the preparation, syndication, administration or interpretation
of the Loan Documents and other instruments mentioned herein, each closing
hereunder, any amendments, modifications, approvals, consents or waivers hereto
or hereunder, or the cancellation of any Loan Document upon payment in full in
cash of all of the Obligations or pursuant to any terms of such Loan Document
for providing for such cancellation, (iv) the fees, expenses and disbursements
of the Agent or any
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of its affiliates incurred by the Agent or such affiliate in connection with the
preparation, syndication, administration or interpretation of the Loan Documents
and other instruments mentioned herein, including all due diligence costs and
expenses, title insurance premiums and surveyor, engineering and appraisal
charges, (v) any fees, costs, expenses and bank charges, including bank charges
for returned checks, incurred by the Agent in establishing, maintaining or
handling agency accounts, lock box accounts and other accounts for the
collection of any of the Collateral; (vi) all reasonable out-of-pocket expenses
(including without limitation reasonable attorneys' fees and costs, which
attorneys may be employees of any Bank or the Agent, and reasonable consulting,
accounting, appraisal, investment banking and similar professional fees and
charges) incurred by any Bank or the Agent in connection with (A) the
enforcement of or preservation of rights under any of the Loan Documents against
any of the Borrowers or any of their Subsidiaries or the administration thereof
after the occurrence of a Default or Event of Default and (B) any litigation,
proceeding or dispute whether arising hereunder or otherwise, in any way related
to any Bank's or the Agent's relationship with any of the Borrowers or any of
their Subsidiaries and (vii) all reasonable fees, expenses and disbursements of
the Agent incurred in connection with UCC searches, UCC filings or mortgage
recordings.
16.2. INDEMNIFICATION. The Borrowers jointly and severally agree to
indemnify and hold harmless the Agent, its affiliates and the Banks from and
against any and all claims, actions and suits whether groundless or otherwise,
and from and against any and all liabilities, losses, damages and expenses of
every nature and character arising out of this Credit Agreement or any of the
other Loan Documents or the transactions contemplated hereby including, without
limitation, (i) any actual or proposed use by any of the Borrowers or any of
their Subsidiaries of the proceeds of any of the Loans or Letters of Credit,
(ii) the reversal or withdrawal of any provisional credits granted by the Agent
upon the transfer of funds from lock-box, bank agency or concentration accounts
or in connection with the provisional honoring of checks or other items, (iii)
any actual or alleged infringement of any patent, copyright, trademark, service
xxxx or similar right of any of the Borrowers or any of their Subsidiaries
comprised in the Collateral, (iv) any of the Borrowers or any of their
Subsidiaries entering into or performing this Credit Agreement or any of the
other Loan Documents or (v) with respect to the Borrowers and their Subsidiaries
and their respective properties and assets, the violation of any Environmental
Law, the presence, disposal, escape, seepage, leakage, spillage, discharge,
emission, release or threatened release of any Hazardous Substances or any
action, suit, proceeding or investigation brought or threatened with respect to
any Hazardous Substances
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(including, but not limited to, claims with respect to wrongful death, personal
injury or damage to property), in each case including, without limitation, the
reasonable fees and disbursements of counsel and allocated costs of internal
counsel incurred in connection with any such investigation, litigation or other
proceeding. In litigation, or the preparation therefor, the Banks and the Agent
and its affiliates shall be entitled to select their own counsel and, in
addition to the foregoing indemnity, the Borrowers jointly and severally agree
to pay promptly the reasonable fees and expenses of such counsel. If, and to the
extent that the obligations of the Borrowers under this Section 16.2 are
unenforceable for any reason, the Borrowers hereby agree to make the maximum
contribution to the payment in satisfaction of such obligations which is
permissible under applicable law.
16.3. SURVIVAL. The covenants contained in this Section 16 shall
survive payment or satisfaction in full of all other Obligations.
17. TREATMENT OF CERTAIN CONFIDENTIAL INFORMATION.
17.1. SHARING OF INFORMATION WITH SECTION 20 SUBSIDIARY. The Borrowers
acknowledge that from time to time financial advisory, investment banking and
other services may be offered or provided to the Borrowers or one or more of
their Subsidiaries, in connection with this Credit Agreement or otherwise, by a
Section 20 Subsidiary. Each of the Borrowers, for itself and each of its
Subsidiaries, hereby authorizes (a) such Section 20 Subsidiary to share with the
Agent and each Bank any information delivered to such Section 20 Subsidiary by
the Borrowers or any of their Subsidiaries, and (b) the Agent and each Bank to
share with such Section 20 Subsidiary any information delivered to the Agent or
such Bank by any of the Borrowers or any of their Subsidiaries pursuant to this
Credit Agreement, or in connection with the decision of such Bank to enter into
this Credit Agreement; it being understood, in each case, that any such Section
20 Subsidiary receiving such information shall be bound by the confidentiality
provisions of this Credit Agreement. Such authorization shall survive the
payment and satisfaction in full of all of Obligations.
17.2. CONFIDENTIALITY. Each of the Banks and the Agent agrees, on
behalf of itself and each of its affiliates, directors, officers, employees and
representatives, to use reasonable precautions to keep confidential, in
accordance with their customary procedures for handling confidential information
of the same nature and in accordance with safe and sound banking practices, any
non-public information supplied to it by any of the Borrowers or any of their
Subsidiaries pursuant to this Credit Agreement
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that is identified by such Person as being confidential at the time the same is
delivered to the Banks or the Agent, PROVIDED that nothing herein shall limit
the disclosure of any such information (a) after such information shall have
become public other than through a violation of this Section 17, (b) to the
extent required by statute, rule, regulation or judicial process, (c) to counsel
for any of the Banks or the Agent, (d) to bank examiners or any other regulatory
authority having jurisdiction over any Bank or the Agent, or to auditors or
accountants, (e) to the Agent, any Bank or any Section 20 Subsidiary, (f) in
connection with any litigation to which any one or more of the Banks, the Agent
or any Section 20 Subsidiary is a party, or in connection with the enforcement
of rights or remedies hereunder or under any other Loan Document, (g) to a
Subsidiary or affiliate of such Bank as provided in Section 17.1 or (h) to any
assignee or participant (or prospective assignee or participant) so long as such
assignee or participant agrees to be bound by the provisions of Section 19.6.
17.3. PRIOR NOTIFICATION. Unless specifically prohibited by applicable
law or court order, each of the Banks and the Agent shall, prior to disclosure
thereof, notify the Borrowers of any request for disclosure of any such
non-public information by any governmental agency or representative thereof
(other than any such request in connection with an examination of the financial
condition of such Bank by such governmental agency) or pursuant to legal
process.
17.4. OTHER. In no event shall any Bank or the Agent be obligated or
required to return any materials furnished to it or any Section 20 Subsidiary by
any of the Borrowers or any of their Subsidiaries. The obligations of each Bank
under this Section 17 shall supersede and replace the obligations of such Bank
under any confidentiality letter in respect of this financing signed and
delivered by such Bank to any of the Borrowers prior to the date hereof and
shall be binding upon any assignee of, or purchaser of any participation in, any
interest in any of the Loans or Reimbursement Obligations from any Bank.
18. SURVIVAL OF COVENANTS, ETC.
All covenants, agreements, representations and warranties made herein, in
the Notes, in any of the other Loan Documents or in any documents or other
papers delivered by or on behalf of any of the Borrowers or any of their
Subsidiaries pursuant hereto shall be deemed to have been relied upon by the
Banks and the Agent, notwithstanding any investigation heretofore or hereafter
made by any of them, and shall survive the making by the Banks of any of the
Loans and the issuance, extension or renewal of any Letters of Credit, as herein
contemplated, and
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shall continue in full force and effect so long as any Letter of Credit or any
amount due under this Credit Agreement or the Notes or any of the other Loan
Documents remains outstanding or any Bank has any obligation to make any Loans
or the Agent has any obligation to issue, extend or renew any Letter of Credit,
and for such further time as may be otherwise expressly specified in this Credit
Agreement. All statements contained in any certificate or other paper delivered
to any Bank or the Agent at any time by or on behalf of any of the Borrowers or
any of their Subsidiaries pursuant hereto or in connection with the transactions
contemplated hereby shall constitute representations and warranties by such
Borrower or such Subsidiary hereunder.
19. ASSIGNMENT AND PARTICIPATION.
19.1. CONDITIONS TO ASSIGNMENT BY BANKS. Except as provided herein,
each Bank may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Credit Agreement (including all or
a portion of its Commitment Percentage and Commitment and the same portion of
the Loans at the time owing to it, the Notes held by it and its participating
interest in the risk relating to any Letters of Credit); PROVIDED that (i) each
of the Agent and, unless a Default or Event of Default shall have occurred and
be continuing, the Borrowers shall have given its or their prior written consent
to such assignment, which consent, in the case of the Borrowers, will not be
unreasonably withheld, (ii) each such assignment shall be of a constant, and not
a varying, percentage of all the assigning Bank's rights and obligations under
this Credit Agreement, (iii) each assignment shall be in an amount that is a
whole multiple of $2,500,000, and (iv) the parties to such assignment shall
execute and deliver to the Agent, for recording in the Register (as hereinafter
defined), an Assignment and Acceptance, substantially in the form of EXHIBIT D
hereto (an "Assignment and Acceptance"), together with any Notes subject to
such assignment. Upon such execution, delivery, acceptance and recording, from
and after the effective date specified in each Assignment and Acceptance, which
effective date shall be at least five (5) Business Days after the execution
thereof, (i) the assignee thereunder shall be a party hereto and, to the extent
provided in such Assignment and Acceptance, have the rights and obligations of a
Bank hereunder, and (ii) the assigning Bank shall, to the extent provided in
such assignment and upon payment to the Agent of the registration fee referred
to in Section 19.3, be released from its obligations under this Credit
Agreement.
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19.2. CERTAIN REPRESENTATIONS AND WARRANTIES; LIMITATIONS;
COVENANTS. By executing and delivering an Assignment and Acceptance, the
parties to the assignment thereunder confirm to and agree with each other and
the other parties hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free
and clear of any adverse claim, the assigning Bank makes no
representation or warranty, express or implied, and assumes no
responsibility with respect to any statements, warranties or
representations made in or in connection with this Credit Agreement or
the execution, legality, validity, enforceability, genuineness,
sufficiency or value of this Credit Agreement, the other Loan Documents
or any other instrument or document furnished pursuant hereto or the
attachment, perfection or priority of any security interest or mortgage,
(b) the assigning Bank makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrowers and their Subsidiaries or any other Person primarily or
secondarily liable in respect of any of the Obligations, or the
performance or observance by the Borrowers and their Subsidiaries or any
other Person primarily or secondarily liable in respect of any of the
Obligations of any of their obligations under this Credit Agreement or
any of the other Loan Documents or any other instrument or document
furnished pursuant hereto or thereto;
(c) such assignee confirms that it has received a copy of this
Credit Agreement, together with copies of the most recent financial
statements referred to in Section 7.4 and Section 8.4 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;
(d) such assignee will, independently and without reliance upon
the assigning Bank, the Agent or any other Bank 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 Credit Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
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(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Credit Agreement and the other Loan Documents as are delegated to the
Agent by the terms hereof or thereof, together with such powers as are
reasonably incidental thereto;
(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Credit
Agreement are required to be performed by it as a Bank;
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance; and
(i) such assignee acknowledges that it has made arrangements with
the assigning Bank satisfactory to such assignee with respect to its PRO
RATA share of Letter of Credit Fees in respect of outstanding Letters of
Credit.
19.3. REGISTER. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register or similar list (the "Register") for
the recordation of the names and addresses of the Banks and the Commitment
Percentage of, and principal amount of the Loans owing to and Letter of Credit
Participations purchased by, the Banks from time to time. The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrowers, the Agent and the Banks may treat each Person whose name is recorded
in the Register as a Bank hereunder for all purposes of this Credit Agreement.
The Register shall be available for inspection by the Borrowers and the Banks at
any reasonable time and from time to time upon reasonable prior notice. Upon
each such recordation, the assigning Bank agrees to pay to the Agent a
registration fee in the sum of $3,500.
19.4. NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (i) record the information contained therein in
the Register, and (ii) give prompt notice thereof to the Borrowers and the Banks
(other than the assigning Bank). Within five (5) Business Days after receipt of
such notice, the Borrowers, at their own expense, shall execute and deliver to
the Agent, in exchange for each surrendered Note, a new Note to the order of
such Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Acceptance and, if the assigning Bank
has retained some portion of its obligations hereunder, a new Note to the order
of the assigning Bank in an amount equal to the amount retained by it hereunder.
Such new Notes shall provide that they
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are replacements for the surrendered Notes, shall be in an aggregate principal
amount equal to the aggregate principal amount of the surrendered Notes, shall
be dated the effective date of such in Assignment and Acceptance and shall
otherwise be substantially the form of the assigned Notes. Within five (5) days
of issuance of any new Notes pursuant to this Section 19.4, the Borrowers shall
deliver an opinion of counsel, addressed to the Banks and the Agent, relating to
the due authorization, execution and delivery of such new Notes and the
legality, validity and binding effect thereof, in form and substance
satisfactory to the Banks. The surrendered Notes shall be canceled and returned
to the Borrowers.
19.5. PARTICIPATIONS. Each Bank may sell participations to one or more
banks or other entities in all or a portion of such Bank's rights and
obligations under this Credit Agreement and the other Loan Documents; PROVIDED
that (i) each such participation shall be in an amount of not less than
$2,500,000, (ii) any such sale or participation shall not affect the rights and
duties of the selling Bank hereunder to the Borrowers and (iii) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve waivers, amendments or modifications that would reduce the
principal of or the interest rate on any Loans, extend the term or increase the
amount of the Commitment of such Bank as it relates to such participant, reduce
the amount of any commitment fees or Letter of Credit Fees to which such
participant is entitled or extend any regularly scheduled payment date for
principal or interest.
19.6. DISCLOSURE. The Borrowers agree that in addition to disclosures
made in accordance with standard and customary banking practices any Bank may
disclose information obtained by such Bank pursuant to this Credit Agreement to
assignees or participants and potential assignees or participants hereunder;
PROVIDED that such assignees or participants or potential assignees or
participants shall agree (i) to treat in confidence such information unless such
information otherwise becomes public knowledge, (ii) not to disclose such
information to a third party, except as required by law or legal process and
(iii) not to make use of such information for purposes of transactions unrelated
to such contemplated assignment or participation.
19.7. ASSIGNEE OR PARTICIPANT AFFILIATED WITH THE BORROWERS. If any
assignee Bank is an Affiliate of any of the Borrowers, then any such assignee
Bank shall have no right to vote as a Bank hereunder or under any of the other
Loan Documents for purposes of granting consents or waivers or for purposes of
agreeing to amendments
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or other modifications to any of the Loan Documents or for purposes of making
requests to the Agent pursuant to Section 13.1 or Section 13.2, and the
determination of the Majority Banks shall for all purposes of this Credit
Agreement and the other Loan Documents be made without regard to such assignee
Bank's interest in any of the Loans or Reimbursement Obligations. If any Bank
sells a participating interest in any of the Loans or Reimbursement Obligations
to a participant, and such participant is a Borrower or an Affiliate of any of
the Borrowers, then such transferor Bank shall promptly notify the Agent of the
sale of such participation. A transferor Bank shall have no right to vote as a
Bank hereunder or under any of the other Loan Documents for purposes of granting
consents or waivers or for purposes of agreeing to amendments or modifications
to any of the Loan Documents or for purposes of making requests to the Agent
pursuant to Section 13.1 or Section 13.2 to the extent that such participation
is beneficially owned by the Borrowers or any Affiliate of the Borrower, and the
determination of the Majority Banks shall for all purposes of this Credit
Agreement and the other Loan Documents be made without regard to the interest of
such transferor Bank in the Loans or Reimbursement Obligations to the extent of
such participation.
19.8. MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Bank shall
retain its rights to be indemnified pursuant to Section 16 with respect to any
claims or actions arising prior to the date of such assignment. If any assignee
Bank is not incorporated under the laws of the United States of America or any
state thereof, it shall, prior to the date on which any interest or fees are
payable hereunder or under any of the other Loan Documents for its account,
deliver to the Borrowers and the Agent certification as to its exemption from
deduction or withholding of any United States federal income taxes. If BKB
transfers all of its interest, rights and obligations under this Credit
Agreement, the Agent shall, in consultation with the Borrowers and with the
consent of the Borrowers and the Majority Banks, appoint another Bank to act as
a Reference Bank hereunder. Anything contained in this Section 19 to the
contrary notwithstanding, any Bank may at any time pledge all or any portion of
its interest and rights under this Credit Agreement (including all or any
portion of its Notes) to any of the twelve Federal Reserve Banks organized under
Section 4 of the Federal Reserve Act, 12 U.S.C. Section 341. No such pledge or
the enforcement thereof shall release the pledgor Bank from its obligations
hereunder or under any of the other Loan Documents.
19.9. ASSIGNMENT BY BORROWERS. None of the Borrowers shall assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Banks.
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20. NOTICES, ETC.
Except as otherwise expressly provided in this Credit Agreement, all
notices and other communications made or required to be given pursuant to this
Credit Agreement or the Notes or any Letter of Credit Applications shall be in
writing and shall be delivered in hand, mailed by United States registered or
certified first class mail, postage prepaid, sent by overnight courier, or sent
by telegraph, telecopy, facsimile or telex and confirmed by delivery via courier
or postal service, addressed as follows:
(a) if to any or all of the Borrowers, at 000 Xxxxxxx Xxxxxx
Xxxxx, Xxxxxxx Xxxxx, XX 00000, Attention: Xxxxxxx X. XxXxxxxxx, Xx., or
at such other address for notice as the Borrowers shall last have
furnished in writing to the Person giving the notice;
(b) if to the Agent, at 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx
00000, XXX, Attention: Xxxxxx X. Xxxxxx, Xx., Managing Director, or such
other address for notice as the Agent shall last have furnished in
writing to the Person giving the notice; and
(c) if to any Bank, at such Bank's address set forth on
SCHEDULE 1 hereto, or such other address for notice as such Bank shall
have last furnished in writing to the Person giving the notice.
Any such notice or demand shall be deemed to have been duly given or made
and to have become effective (i) if delivered by hand, overnight courier or
facsimile to a responsible officer of the party to which it is directed, at the
time of the receipt thereof by such officer or the sending of such facsimile and
(ii) if sent by registered or certified first-class mail, postage prepaid, on
the third Business Day following the mailing thereof.
21. GOVERNING LAW.
THIS CREDIT AGREEMENT AND, EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
THEREIN, EACH OF THE OTHER LOAN DOCUMENTS ARE CONTRACTS UNDER THE LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS AND SHALL FOR ALL PURPOSES BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF SAID COMMONWEALTH OF MASSACHUSETTS
(EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). THE BORROWERS
AGREE THAT ANY SUIT FOR THE ENFORCEMENT OF THIS CREDIT AGREEMENT OR ANY OF THE
OTHER LOAN DOCUMENTS MAY BE BROUGHT IN THE COURTS OF THE COMMONWEALTH OF
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MASSACHUSETTS OR ANY FEDERAL COURT SITTING THEREIN AND CONSENTS TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURT AND SERVICE OF PROCESS IN ANY SUCH SUIT
BEING MADE UPON THE BORROWERS BY MAIL AT THE ADDRESS SPECIFIED IN Section 20.
THE BORROWERS HEREBY WAIVE ANY OBJECTION THAT THEY MAY NOW OR HEREAFTER HAVE TO
THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN
INCONVENIENT COURT.
22. HEADINGS.
The captions in this Credit Agreement are for convenience of reference
only and shall not define or limit the provisions hereof.
23. COUNTERPARTS.
This Credit Agreement and any amendment hereof may be executed in several
counterparts and by each party on a separate counterpart, each of which when
executed and delivered shall be an original, and all of which together shall
constitute one instrument. In proving this Credit Agreement it shall not be
necessary to produce or account for more than one such counterpart signed by the
party against whom enforcement is sought.
24. ENTIRE AGREEMENT, ETC.
The Loan Documents and any other documents executed in connection
herewith or therewith express the entire understanding of the parties with
respect to the transactions contemplated hereby. Neither this Credit Agreement
nor any term hereof may be changed, waived, discharged or terminated, except as
provided in Section 26.
25. WAIVER OF JURY TRIAL.
Each of the Borrowers, the Banks and the Agent hereby waives its right to
a jury trial with respect to any action or claim arising out of any dispute in
connection with this Credit Agreement, the Notes or any of the other Loan
Documents, any rights or obligations hereunder or thereunder or the performance
of which rights and obligations. Except as prohibited by law, each of the
Borrowers hereby waives any right it may have to claim or recover in any
litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. Each of the Borrowers (i) certifies that no representative,
agent or attorney of any Bank or the
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Agent has represented, expressly or otherwise, that such Bank or the Agent would
not, in the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that the Agent and the Banks have been induced to enter into this
Credit Agreement, the other Loan Documents to which it is a party by, among
other things, the waivers and certifications contained herein.
26. CONSENTS, AMENDMENTS, WAIVERS, ETC.
Any consent or approval required or permitted by this Credit Agreement to
be given by the Banks may be given, and any term of this Credit Agreement, the
other Loan Documents or any other instrument related hereto or mentioned herein
may be amended, and the performance or observance by any of the Borrowers or any
of their Subsidiaries of any terms of this Credit Agreement, the other Loan
Documents or such other instrument or the continuance of any Default or Event of
Default may be waived (either generally or in a particular instance and either
retroactively or prospectively) with, but only with, the written consent of the
Borrowers and the written consent of the Majority Banks. Notwithstanding the
foregoing, the rate of interest on the Notes (other than interest accruing
pursuant to Section 5.11.2 following the effective date of any waiver by the
Majority Banks of the Default or Event of Default relating thereto) and the
amount of commitment fees or Letter of Credit Fees hereunder may not be reduced
without the written consent of the Borrowers and the written consent of each
Bank affected thereby; the amount of the Commitments of the Banks may not be
increased without the written consent of the Borrowers and the written consent
of each Bank affected thereby; the Revolving Credit Loan Maturity Date may not
be postponed without the written consent of each Bank affected thereby; this
Section 26 and the definition of Majority Banks may not be amended, without the
written consent of all of the Banks; and the amount of the Agent's Fee or any
Letter of Credit Fees payable for the Agent's account and Section 15 may not be
amended without the written consent of the Agent. No waiver shall extend to or
affect any obligation not expressly waived or impair any right consequent
thereon. No course of dealing or delay or omission on the part of the Agent or
any Bank in exercising any right shall operate as a waiver thereof or otherwise
be prejudicial thereto. No notice to or demand upon the Borrowers shall entitle
the Borrowers to other or further notice or demand in similar or other
circumstances.
27. SEVERABILITY.
The provisions of this Credit Agreement are severable and if any one
clause or provision hereof shall be held invalid or unenforceable in
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whole or in part in any jurisdiction, then such invalidity or unenforceability
shall affect only such clause or provision, or part thereof, in such
jurisdiction, and shall not in any manner affect such clause or provision in any
other jurisdiction, or any other clause or provision of this Credit Agreement in
any jurisdiction.
IN WITNESS WHEREOF, the undersigned have duly executed this Credit
Agreement as a sealed instrument as of the date first set forth above.
AMERICAN RESTAURANT GROUP, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
LOCAL FAVORITE, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
XXXXXX'X, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
ARG ENTERPRISES, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
ARG PROPERTY MANAGEMENT CORPORATION
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
SPOONS RESTAURANTS, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
SPECTRUM FOODS, INC.
By: /s/ Xxxxxxx X. XxXxxxxxx, Xx.
------------------------------
Name: Xxxxxxx X. XxXxxxxxx, Xx.
Title: Vice President & Chief
Financial Officer
BANKBOSTON, N.A., individually and as Agent
By: /s/ Xxxxxx X. Xxxxxx, Xx.
------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Managing Director