CREDIT AGREEMENT
dated as of April 23, 1998,
by and among
XXXXXX CORPORATION
as Borrower,
the Lenders referred to herein,
and
FIRST UNION NATIONAL BANK
as Agent
THIS CREDIT AGREEMENT is dated as of the 23rd day of April, 1998, by
and among XXXXXX CORPORATION, a corporation organized under the laws of the
Commonwealth of Virginia (the "Borrower"), the Lenders who are or may become
parties to this Agreement (the "Lenders"), and FIRST UNION NATIONAL BANK, a
national banking association (the "Agent"), as Agent for the Lenders.
STATEMENT OF PURPOSE
The Borrower has requested, and the Lenders have agreed to make,
certain revolving credit loans to the Borrower on the terms and conditions
contained in this Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereby agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.1. Definitions. The following terms when used in this
Agreement shall have the meanings assigned to them below:
"Affiliate" means, with respect to any Person, any other Person (other
than a Subsidiary) which directly or indirectly through one or more
intermediaries, controls, or is controlled by, or is under common control with,
such first Person or any of its Subsidiaries. The term "control" means (a) the
power to vote twenty percent (20%) or more of the securities or other equity
interests of a Person having ordinary voting power, or (b) the possession,
directly or indirectly, of any other power to direct or cause the direction of
the management and policies of a Person, whether through ownership of voting
securities, by contract or otherwise. Notwithstanding the foregoing, no
individual shall be deemed an Affiliate of a specified Person solely by reason
of his or her being a director, officer or employee of such specified Person or
any of its Subsidiaries.
"Agent" means First Union in its capacity as Agent hereunder, and any
successor thereto appointed pursuant to Section 11.9.
"Agent's Office" means the office of the Agent specified in or
determined in accordance with the provisions of Section 12.1.
"Aggregate Revolving Credit Commitment" means the aggregate amount of
the Lenders' Revolving Credit Commitments hereunder, as such amount may be
reduced from time to time pursuant to Section 2.5. On the Closing Date, the
Aggregate Revolving Credit Commitment shall be Two Hundred Fifty Million Dollars
($250,000,000.00).
"Agreement" means this Credit Agreement, as amended or modified from
time to time.
"A. M. Best" means A. M. Best & Company and any successor thereto.
"Annual Statement" means, with respect to any Insurance Company
Subsidiary, the statutory annual financial statement of such Insurance Company
Subsidiary as is required to be filed with the applicable Governmental Authority
of its state of domicile, together with all exhibits and schedules filed
therewith. References herein to items on particular pages, lines, columns,
exhibits and schedules to an Annual Statement are based on the format
promulgated by the National Association of Insurance Commissioners for 1997
Statutory Annual Statements, and if such format is changed in future years so
that different information is contained in such items or they no longer exist,
it is understood and agreed that the reference contained herein is to the item
of information consistent with that reported in the referenced item in the 1997
Annual Statement of such Insurance Company Subsidiary.
"Applicable Category" means the applicable category of senior debt
credit ratings for the Borrower in effect from time to time as indicated below:
Applicable Category Credit Ratings
Xxxxx'x S&P Duff & Xxxxxx
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 1 Equal to or higher Equal to or higher Equal to or higher
than A3 than A- than A-
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 2 Baa1 BBB+ BBB+
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 3 Baa2 BBB BBB
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 4 Baa3 BBB- BBB-
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 5 Lower than Baa3 Lower than BBB- Lower than BBB-
------------------------------ ----------------------------- ----------------------------- ------------------------------
For purposes of determining the Applicable Category at any time (a) if two of
the credit ratings established by Xxxxx'x, S&P and Duff & Xxxxxx fall within one
category and the third falls within another category, all such credit ratings
shall be deemed to fall within the category in which the two credit ratings
fall, (b) if all three of the credit ratings established by Xxxxx'x, S&P and
Duff & Xxxxxx fall within different categories, all such credit ratings shall be
deemed to fall in the middle category, (c) if only two such rating agencies have
issued credit ratings, (i) if they fall within the same category, the Applicable
Category shall be the applicable category for such credit ratings, and (ii) if
they fall within different categories, the Applicable Category shall be (x) the
higher applicable category if the applicable credit ratings are not more than
two categories apart and neither of the credit ratings is below Category 4, or
(y) the lower applicable category if the applicable credit ratings are more than
two categories apart or either of the credit ratings is below Category 4, (d) if
only one such rating agency has issued a credit rating, the Applicable Category
shall be the applicable category for such credit rating, and (e) if any credit
rating established by Xxxxx'x, S&P or Duff & Xxxxxx changes (other than as a
result of a change in the rating system of Xxxxx'x, S&P or Duff & Xxxxxx), such
change (and any corresponding change in the Applicable Category, the Applicable
Margin, the interest rates applicable to the Revolving Credit Loans and the
Revolving Credit Fee Percentage) shall be effective as of the date which is five
(5) Business Days after the day on which the Agent receives written notice of
the applicable credit rating change. If the rating system of Xxxxx'x, S&P or
Duff & Xxxxxx changes, or if any such rating agency ceases to be in the business
of rating corporate debt obligations, the Borrower and the Lenders agree to
negotiate in good faith to amend the references to specific ratings in this
definition to reflect such changed rating system or non-availability of ratings
from such rating agency.
"Applicable Law" means all applicable provisions of constitutions,
statutes, laws, rules, treaties, regulations and orders of all Governmental
Authorities and all orders and decrees of all courts and arbitrators.
"Applicable Margin" means, with respect to each type of Loan, the per
annum percentage set forth below such type of Loan and opposite the Applicable
Category in effect from time to time:
Applicable Category Applicable Margin
Base Rate Loan CD Rate Loan LIBOR Rate Loan
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 1 0% .35% .225%
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 2 0% .375% .25%
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 3 0% .475% .35%
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 4 0% .575% .45%
------------------------------ ----------------------------- ----------------------------- ------------------------------
Category 5 0% .75% .625%
------------------------------ ----------------------------- ----------------------------- ------------------------------
"Assessment Rate" means, for any day, the net annual assessment rate in
effect on such day which is payable by a member of the Bank Insurance Fund
classified as well capitalized and within supervisory subgroup "(A)" (or a
comparable successor assessment risk classification) within the meaning of 12
C.F.R. Section 327.4(a)(1)(i) and (2)(i) (or any successor provision) to the
FDIC for the FDIC's insuring time deposits at offices of such institution in the
United States.
"Assignment and Acceptance" shall have the meaning assigned thereto in
Section 12.10(b)(iii).
"Base Rate" means, at any time, the higher of (a) the Prime Rate or (b)
the Federal Funds Rate plus 1/2 of 1% per annum; and each change in the Base
Rate shall take effect simultaneously with the corresponding change or changes
in the Prime Rate or the Federal Funds Rate.
"Base Rate Loan" means any Revolving Credit Loans while bearing
interest at a rate based upon the Base Rate as provided in Section 3.1(a).
"Borrower" means Xxxxxx Corporation, a Virginia corporation, in its
capacity as borrower hereunder.
"Business Day" means (a) for all purposes other than as set forth in
clause (b) below, any day other than a Saturday, Sunday or legal holiday on
which banks in Charlotte, North Carolina are open for the conduct of their
commercial banking business, and (b) with respect to all notices and
determinations in connection with, and payments of principal and interest on,
any LIBOR Rate Loan, any day that is a Business Day described in clause (a) and
that is also a day for trading by and between banks in Dollar deposits in the
London interbank market.
"Capital Lease" means, with respect to the Borrower and its
Subsidiaries, any lease of any property that should, in accordance with GAAP, be
classified and accounted for as a capital lease on a Consolidated balance sheet
of the Borrower and its Subsidiaries.
"Capital Lease Obligation" means the amount that should, in accordance
with GAAP, be reported as a liability on the balance sheet of the lessee with
respect to a Capital Lease.
"CD Base Rate" means, with respect to any CD Rate Loan for the Interest
Period applicable thereto, the interest rate per annum (expressed as a decimal
and rounded upward, if necessary, to the next higher 1/100th of 1%) determined
by the Agent to be the prevailing rate bid, at 10:00 a.m. (Charlotte time), or
as soon thereafter as practicable, on the Business Day on which the applicable
Interest Period commences, offered by two (2) or more certificate of deposit
dealers of recognized standing for the purchase at face value from First Union
of its negotiable certificates of deposit having a maturity comparable to the
duration of the applicable Interest Period and in the approximate amount of such
CD Rate Loan. If no such bids or offers are generally available or if the Agent
determines that it is impossible or impractical for First Union actually to
obtain such bids or offers from certificate of deposit dealers, then the Agent
shall be entitled to determine the CD Base Rate by estimating in its reasonable
judgment the interest rate per annum (as described above) that would be
applicable if such bids and offers were generally available.
"CD Rate" means, with respect to any CD Rate Loan for the Interest
Period applicable thereto, an interest rate per annum (rounded upward, if
necessary, to the next higher 1/100th of 1%) determined by the Agent pursuant to
the following formula:
CD Rate = CD Base Rate + Assessment Rate
--------------------------------
1.00 - CD Reserve Percentage
The CD Rate shall be adjusted automatically on and as of the effective date of
any change in the Assessment Rate or the CD Reserve Percentage.
"CD Rate Loan" means any Revolving Credit Loans while bearing interest
at a rate based upon the CD Rate as provided in Section 3.1(a).
"CD Reserve Percentage" means, for any day, the percentage (expressed
as a decimal and rounded upward, if necessary, to the next higher 1/100th of 1%)
which is in effect for such day as prescribed by the Federal Reserve Board (or
any successor), for determining the maximum reserve requirement (including
without limitation any basic, supplemental or emergency reserves) with respect
to new non-personal time deposits in Dollars in the United States of America
having a maturity comparable to the duration of the applicable Interest Period
and in an amount of $100,000 or more for a member bank of the Federal Reserve
System in New York City.
"Closing Date" means the date of this Agreement or such later Business
Day upon which each condition described in Article 4 shall be satisfied or
waived in all respects in a manner acceptable to the Agent, in its sole
discretion.
"Code" means the Internal Revenue Code of 1986, and the rules and
regulations thereunder, each as amended or supplemented from time to time.
"Combined Statutory Surplus" means, with respect to the Insurance
Company Subsidiaries at any date, the aggregate Statutory Surplus (on a combined
basis without duplication) of such Insurance Company Subsidiaries.
"Consolidated" means, when used with reference to financial statements
or financial statement items of the Borrower and its Subsidiaries, such
statements or items on a consolidated basis in accordance with applicable
principles of consolidation under GAAP.
"Consolidated Debt" means, with respect to the Borrower and its
Subsidiaries at any date, the Debt of the Borrower and its Subsidiaries,
determined on a consolidated basis as of such date, including, without
limitation, all Debt outstanding under this Agreement and all Debt incurred in
connection with the acquisition of any Pledged Subsidiary.
"Consolidated Subsidiary" means a Subsidiary of the Borrower, the
accounts of which would be consolidated with those of the Borrower in the
Consolidated financial statements of the Borrower and its Subsidiaries in
accordance with GAAP.
"Consolidated Total Capital" means, with respect to the Borrower and
its Subsidiaries at any date, the sum of Consolidated Debt, Stockholders' Equity
and Qualified Debt Obligations; provided, that for purposes of this definition
only, in determining Qualified Debt Obligations, any Qualified Debt Obligation
which includes any put right or option or other right or option in favor of the
holder to cause such Qualified Debt Obligation to be redeemed or otherwise paid
on a date which is earlier than one (1) year after the Revolving Credit
Termination Date, shall be disregarded.
"Contingent Obligation" means, with respect to the Borrower and its
Subsidiaries, without duplication, any obligation, contingent or otherwise, of
any such Person pursuant to which such Person has directly or indirectly
guaranteed any Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of any such Person (a) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to keep
well, to purchase assets, goods, securities or services, to take-or-pay, or to
maintain financial statement condition or otherwise) or (b) entered into for the
purpose of assuring in any other manner the obligee of such Debt or other
obligation of the payment thereof or to protect such obligee against loss in
respect thereof (in whole or in part); provided, that the term Contingent
Obligation shall not include (i) obligations under insurance or reinsurance
policies, or (ii) endorsements for collection or deposit in the ordinary course
of business.
"Debt" means, with respect to the Borrower and its Subsidiaries at any
date and without duplication, the sum of the following calculated in accordance
with GAAP: (a) all liabilities, obligations and indebtedness for borrowed money,
including but not limited to obligations evidenced by bonds, debentures, notes
or other similar instruments of any such Person and obligations incurred in
connection with the acquisition of Pledged Subsidiaries, (b) all obligations to
pay the deferred purchase price of property or services of any such Person
(other than trade payables due from such Person and arising in the ordinary
course of business), (c) all Capital Lease Obligations of such Person, (d) all
Debt of any other Person secured by a Lien on any asset of any such Person, (e)
all Contingent Obligations of any such Person, (f) all obligations, contingent
or otherwise, of any such Person relating to the face amount of letters of
credit, whether or not drawn, and banker's acceptances issued for the account of
any such Person, but excluding any obligation relating to an undrawn letter of
credit if the undrawn letter of credit is issued in connection with a liability
for which a reserve has been established by the Borrower or the applicable
Subsidiary in accordance with GAAP, and (g) all obligations incurred by any such
Person pursuant to Hedging Agreements which are due and payable; provided that
the term Debt shall not include any Qualified Debt Obligations.
"Default" means any of the events specified in Section 10.1, which with
the passage of time, the giving of notice or any other condition, would
constitute an Event of Default.
"Defaulting Lender" shall have the meaning assigned thereto in Section
3.12.
"Derivative Agreement" means a Hedging Agreement or any other agreement
of the Borrower relating to a rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency option
or any other similar transaction (including any option with respect to any of
the foregoing transactions) or any combination of the foregoing transactions.
"Dollars" or "$" means, unless otherwise qualified, dollars in lawful
currency of the United States.
"Duff & Xxxxxx" means Duff & Xxxxxx Credit Rating Co. and any successor
thereto.
"Eligible Assignee" means, with respect to any assignment of the
rights, interest and obligations of a Lender hereunder, a Person that is at the
time of such assignment (a) a commercial bank organized under the laws of the
United States or any state thereof, having combined capital and surplus in
excess of $500,000,000, (b) a finance company or other financial institution
which in the ordinary course of business extends credit of the type extended
hereunder and which has total assets in excess of $1,000,000,000, (c) already a
Lender hereunder (whether as an original party to this Agreement or as the
permitted assignee of another Lender), (d) the successor (whether by transfer of
assets, merger or otherwise) to all or substantially all of the commercial
lending business of the assigning Lender, or (e) any other Person that has been
approved in writing as an Eligible Assignee by the Borrower and the Required
Lenders, which approval of the Required Lenders shall not be unreasonably
withheld.
"Employee Benefit Plan" means any employee benefit plan within the
meaning of Section 3(3) of ERISA which (a) is maintained for employees of the
Borrower or any ERISA Affiliate or (b) has at any time within the preceding six
years been maintained for the employees of the Borrower or any current or former
ERISA Affiliate.
"Environmental Laws" means any and all federal, state and local laws,
statutes, ordinances, rules, regulations, permits, licenses, approvals,
interpretations and orders of any court or Governmental Authority, relating to
the protection of human health or the environment, including, but not limited
to, requirements pertaining to the manufacture, processing, distribution, use,
treatment, storage, disposal, transportation, handling, reporting, licensing,
permitting, investigation or remediation of Hazardous Materials. Environmental
Laws include, without limitation, the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. ss. 9601 et seq.), the Hazardous
Material Transportation Act (49 U.S.C. ss. 331 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. ss. 6901 et seq.), the Federal Water
Pollution Control Act (33 U.S.C. ss. 1251 et seq.), the Clean Air Act (42 U.S.C.
ss. 7401 et seq.), the Toxic Substances Control Act (15 U.S.C. ss. 2601 et
seq.), the Safe Drinking Water Act (42 U.S.C. ss. 300 et seq.), the
Environmental Protection Agency's regulations relating to underground storage
tanks (40 C.F.R. Parts 280 and 281), and the Occupational Safety and Health Act
(29 U.S.C. ss. 651 et seq.), analogous state statutes, and the rules and
regulations promulgated under the foregoing, as such statutes, rules and
regulations are amended or modified from time to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, each as amended or modified from time to
time.
"ERISA Affiliate" means any Person who together with the Borrower is
treated as a single employer within the meaning of Section 414(b), (c), (m) or
(o) of the Code or Section 4001(b) of ERISA.
"Eurodollar Reserve Percentage" means, for any day, the percentage
(expressed as a decimal) that is in effect on such day, as prescribed by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement for a member bank of the Federal
Reserve System in New York City with deposits exceeding five billion dollars in
respect of "Eurocurrency liabilities" (or in respect of any other category of
liabilities that includes deposits by reference to which the interest rate on
LIBOR Rate Loans is determined or any category of extensions of credit or other
assets that includes loans by a non-United States office of any Lender to United
States residents).
"Event of Default" means any of the events specified in Section 10.1,
provided that any requirement for passage of time, giving of notice, or any
other condition, has been satisfied.
"Existing Credit Facilities" means, collectively, the credit facilities
provided to the Borrower under the Credit Agreement dated as of December 18,
1996, by and among the Borrower, the lenders thereunder and First Union as
agent.
"FASB 115" means Statement No. 115 (Accounting for Certain Investments
in Debt and Equity Securities) issued by the Financial Accounting Standards
Board.
"FDIC" means the Federal Deposit Insurance Corporation and any
successor thereto.
"Federal Funds Rate" means, for any day, the rate per annum (rounded
upward, if necessary, to the nearest 1/100th of 1%) equal to the weighted
average of the rates on overnight Federal funds transactions with members of the
Federal Reserve System arranged by Federal funds brokers on such day, as
published by the Federal Reserve Bank of New York on the Business Day next
succeeding such day in Federal Reserve Board Statistical Release H.15(519) or
any successor or substitute publication, provided that (i) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (ii) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate quoted to First Union National Bank for such day on such
transactions as determined by the Agent.
"Fee Letter" means that certain letter agreement, dated March 13, 1998,
between the Borrower and First Union Capital Markets, a division of Wheat First
Securities, Inc. ("Capital Markets"), relating to certain fees from time to time
payable by the Borrower to Capital Markets, together with all amendments and
modifications thereto.
"First Union" means First Union National Bank, a national banking
association, and its successors.
"Fiscal Quarter" means any fiscal quarter of the Borrower and its
Subsidiaries.
"Fiscal Year" means any fiscal year of the Borrower and its
Subsidiaries ending on December 31.
"Fixed Rate Loan" means any CD Rate Loan or LIBOR Rate Loan.
"GAAP" means generally accepted accounting principles, as recognized by
the American Institute of Certified Public Accountants and the Financial
Accounting Standards Board, consistently applied and maintained on a consistent
basis for the Borrower and its Subsidiaries throughout the period indicated and
consistent with the prior financial practice of the Borrower and its
Subsidiaries.
"Governmental Approvals" means all authorizations, consents, approvals,
licenses and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.
"Governmental Authority" means any nation, province, state or political
subdivision thereof, and any government or any Person exercising executive,
legislative, regulatory or administrative functions of or pertaining to
government, and any corporation or other entity owned or controlled, through
stock or capital ownership or otherwise, by any of the foregoing.
"Hazardous Materials" means any substances or materials (a) which are
or become defined as hazardous wastes, hazardous substances, pollutants,
contaminants, chemical substances or mixtures or toxic substances under any
Environmental Law, (b) which are toxic, explosive, corrosive, flammable,
infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human
health or the environment and are or become regulated by any Governmental
Authority, (c) the presence of which require investigation or remediation under
any Environmental Law or common law, (d) the discharge or emission or release of
which requires a permit or license under any Environmental Law or other
Governmental Approval, (e) which are deemed to constitute a nuisance or a
trespass or pose a health or safety hazard to persons or neighboring properties,
(f) which are materials consisting of underground or aboveground storage tanks,
whether empty, filled or partially filled with any substance, or (g) which
contain, without limitation, asbestos, polychlorinated biphenyls, urea
formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived
substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.
"Hedging Agreement" means any agreement with respect to an interest
rate swap, collar, cap, floor or a forward rate agreement or other agreement
regarding the hedging of interest rate risk exposure executed in connection with
hedging the interest rate exposure of the Borrower under this Agreement, and any
confirming letter executed pursuant to such hedging agreement, all as amended or
modified from time to time.
"Insurance Company Subsidiary" means a Subsidiary of the Borrower which
is a licensed insurance company, including Evanston Insurance Company, Xxxxxx
American Insurance Company, Essex Insurance Company, Xxxxxx Insurance Company
and Investors Insurance Company of America.
"Interest Period" means (i) with respect to any CD Rate Loan, the
period beginning on the date such CD Rate Loan is made or continued as or
converted to a CD Rate Loan and ending one (1), two (2), three (3) or six (6)
months thereafter, as the Borrower may elect, and (ii) with respect to any LIBOR
Rate Loan, the period beginning on the date such LIBOR Rate Loan is made or
continued as or converted to a LIBOR Rate Loan and ending one (1), two (2),
three (3) or six (6) months thereafter, as the Borrower may elect; provided that
(a) each successive Interest Period with respect to a Fixed Rate Loan shall
commence on the date on which the next preceding Interest Period expires; (b)
any Interest Period with respect to a LIBOR Rate Loan that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall end on the last Business Day of the relevant calendar month at the end of
such Interest Period; (c) if any Interest Period would otherwise expire on a day
that is not a Business Day, such Interest Period shall expire on the next
succeeding Business Day, provided that if any Interest Period with respect to a
LIBOR Rate Loan would otherwise expire on a day that is not a Business Day but
is a day of the month after which no further Business Day occurs in such month,
such Interest Period shall expire on the next preceding Business Day; and (d) no
Interest Period shall extend beyond the Revolving Credit Termination Date.
"Lender" means each Person executing this Agreement as a Lender set
forth on the signature pages hereto and each Person that hereafter becomes a
party to this Agreement as a Lender pursuant to Section 12.10.
"Lending Office" means, with respect to any Lender, the office of such
Lender maintaining such Lender's Revolving Credit Loans hereunder.
"LIBOR" means, with respect to any LIBOR Rate Loan for the Interest
Period applicable thereto, the rate for deposits in Dollars for a period equal
to such Interest Period which appears on the Telerate Page 3750 at approximately
11:00 a.m. (London time), two (2) Business Days prior to the commencement of the
applicable Interest Period. If, for any reason, such rate is not available, then
"LIBOR" shall mean the rate per annum at which, as determined by the Agent,
Dollars in the amount of $5,000,000 are being offered to leading banks at
approximately 11:00 a.m. (London time), two (2) Business Days prior to the
commencement of the applicable Interest Period for settlement in immediately
available funds by leading banks in the London interbank market for a period
equal to the Interest Period applicable thereto.
"LIBOR Rate" means, with respect to any LIBOR Rate Loan for the
Interest Period applicable thereto, an interest rate per annum (rounded upward,
if necessary, to the next higher 1/100th of 1%) determined by the Agent pursuant
to the following formula:
LIBOR Rate = LIBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
"LIBOR Rate Loan" means any Revolving Credit Loans while bearing
interest at a rate based upon the LIBOR Rate as provided in Section 3.1(a).
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind with respect to such asset.
For the purposes of this Agreement, a Person shall be deemed to own subject to a
Lien any asset which it has acquired or holds subject to the interest of a
vendor or lessor under any conditional sale agreement, Capital Lease or other
title retention agreement relating to such asset.
"Loan Documents" means, collectively, this Agreement, the Revolving
Credit Notes, any Hedging Agreement executed by any Lender, and each other
document, instrument and agreement executed and delivered by the Borrower, its
Subsidiaries or their counsel in connection with this Agreement or otherwise
referred to herein or contemplated hereby, all as may be amended or modified
from time to time.
"Margin Stock" shall have the meaning assigned to such term in
Regulation U.
"Material Adverse Effect" means, with respect to the Borrower and its
Subsidiaries, a material adverse effect on the business, financial position or
results of operations of the Borrower and its Subsidiaries taken as a whole.
"Material Contract" means (a) any contract or other agreement, written
or oral, of the Borrower or any of its Subsidiaries involving monetary liability
of or to any such Person in an amount in excess of $10,000,000, or (b) any other
contract or agreement, written or oral, of the Borrower or any of its
Subsidiaries the failure to comply with which could reasonably be expected to
have a Material Adverse Effect; provided that the term Material Contract shall
not include any insurance or reinsurance policy or contract.
"Material Subsidiary" means any Consolidated Subsidiary of the Borrower
whose total assets (excluding intercompany accounts) are in excess of ten
percent (10%) of the total assets of the Borrower and its Consolidated
Subsidiaries, with any determination being made as at the end of the most
recently completed Fiscal Quarter for which Consolidated financial statements
have been prepared, except to the extent that the principal financial officers
of the Borrower have actual knowledge to the contrary based on developments or
transactions since such date.
"Material Pension Plan" means a Pension Plan or Pension Plans having
Unfunded Liabilities in excess of $15,000,000.
"Moody's" means Xxxxx'x Investors Service, Inc. and any successor
thereto.
"Multiemployer Plan" means a "multiemployer plan" as defined in Section
4001(a) (3) of ERISA to which the Borrower or any ERISA Affiliate is making, is
accruing an obligation to make or has made contributions within the preceding
six years.
"Notice of Account Designation" means a written notice from the
Borrower to the Agent which is duly signed on behalf of the Borrower and which
designates one or more accounts of the Borrower to which the Agent is authorized
to disburse the proceeds of Revolving Credit Loans.
"Notice of Borrowing" shall have the meaning assigned thereto in
Section 2.2(a).
"Notice of Conversion/Continuation" shall have the meaning assigned
thereto in Section 3.2.
"Notice of Repayment" shall have the meaning assigned thereto in
Section 2.3(c).
"Obligations" means, whether now in existence or hereafter arising: (a)
the principal of and interest on (including interest accruing after the filing
of any bankruptcy or similar petition) the Revolving Credit Loans, (b) all
payment and other obligations owing by the Borrower to any Lender or the Agent
under any Hedging Agreement and (c) all other fees and commissions (including
attorneys' fees), charges, indebtedness, loans, liabilities, financial
accommodations, obligations, covenants and duties owing by the Borrower to the
Agent, the Lenders, or any of them, of every kind, nature and description,
direct or indirect, absolute or contingent, due or to become due, contractual or
tortious, liquidated or unliquidated, and whether or not evidenced by any note,
and whether or not for the payment of money under or in respect of this
Agreement, any Revolving Credit Note or any of the other Loan Documents.
"Other Taxes" shall have the meaning assigned thereto in Section
3.11(b).
"PBGC" means the Pension Benefit Guaranty Corporation or any successor
agency.
"Pension Plan" means any Employee Benefit Plan, other than a
Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or
Section 412 of the Code and which (a) is maintained for employees of the
Borrower or any ERISA Affiliates or (b) has at any time within the preceding six
years been maintained for the employees of the Borrower or any of its current or
former ERISA Affiliates.
"Permitted Liens" means (i) Liens described on Schedule 9.2; (ii)
Purchase Money Liens; (iii) any Lien on any asset securing Debt incurred or
assumed for the purpose of financing all or any part of the cost of acquiring
such asset, provided that such Lien attaches only to such asset and that such
Lien attaches to such asset concurrently with or within ninety (90) days after
the acquisition thereof; (iv) any Lien existing on any asset of any corporation
at the time such corporation becomes a Subsidiary and not created in
contemplation of such event; (v) any Lien on any asset of any corporation
existing at the time such corporation is merged or consolidated with or into the
Borrower or a Subsidiary and not created in contemplation of such event; (vi)
any Lien existing on any asset prior to the acquisition thereof by the Borrower
or a Subsidiary and not created in contemplation of such acquisition; (vii) any
Lien arising out of the refinancing, extension, renewal or refunding of any Debt
secured by any Lien permitted by any of the foregoing clauses, provided that
such Debt is not increased and is not secured by any additional assets; (viii)
Liens arising in the ordinary course of business of the Borrower and its
Subsidiaries (including Liens arising in the ordinary course of the insurance
business of the Borrower and its Subsidiaries) which do not secure Debt and do
not in the aggregate materially detract from or impair the use or value of the
asset or assets subject thereto; (ix) Liens on cash and cash equivalents
securing obligations under Derivative Agreements entered into for bona fide
hedging purposes as long as the aggregate amount of cash and cash equivalents
subject to such Liens does not at any time exceed $25,000,000; (x) any Liens on
securities securing repurchase obligations of the Borrower or a Subsidiary
relating to those securities as long as such Liens arise in the ordinary course
of business and as long as such Liens are in amounts and otherwise are on terms
consistent with then existing practices in the repurchase agreement market; (xi)
any Liens on securities or cash of any Insurance Company Subsidiary which secure
its obligations as a reinsurer; and (xii) any Liens not otherwise permitted by
the foregoing clauses securing Debt in an aggregate principal amount at any time
outstanding not to exceed five percent (5%) of Stockholders' Equity.
"Person" means an individual, corporation, partnership, limited
liability company, association, trust, business trust, joint venture, joint
stock company, pool, syndicate, sole proprietorship, unincorporated
organization, Governmental Authority or any other form of entity or group
thereof specifically listed herein.
"Pledged Subsidiary" means a Subsidiary of the Borrower, any of the
capital stock of which is subject to a Purchase Money Lien or any other Lien.
"Prime Rate" means, at any time, the rate of interest per annum
publicly announced from time to time by First Union as its prime rate. Each
change in the Prime Rate shall be effective as of the opening of business on the
day such change in the Prime Rate occurs. The parties hereto acknowledge that
the rate announced publicly by First Union as its Prime Rate is an index or base
rate and shall not necessarily be its lowest or best rate charged to its
customers or other banks.
"Purchase Money Lien" means (i) any mortgage, pledge, hypothecation,
lien, encumbrance, charge or security interest of any kind upon any capital
stock of any Insurance Company Subsidiary of the Borrower acquired after the
date hereof, if such purchase money lien is given for the purpose of financing,
and does not exceed, the cost to the Borrower or any Subsidiary of acquiring the
capital stock or property of the acquired Insurance Company Subsidiary and such
financing is effected concurrently with, or within six months after, the date of
such acquisition, and (ii) any extension, renewal or refinancing of any such
Purchase Money Lien as long as the principal amount of obligations secured
thereby does not exceed the principal amount of obligations secured immediately
prior to such extension, renewal or refinancing.
"Qualified Debt Obligations" means, without duplication, (a) Debt
securities of the Borrower, provided that the terms of any such Debt security
(i) permit the deferral of principal and interest payments for a period of up to
five years (but not beyond the maturity date), as elected by the Borrower, (ii)
have a maturity for payment of principal of not less than ten (10) years after
the date of issuance, and (iii) include provisions making the Debt security
expressly subordinate to all other Debt of the Borrower; (b) preferred
securities issued by a Subsidiary, the sole purpose of which is to issue such
preferred securities and invest the proceeds thereof in Debt securities of the
type described in clause (a) above, and which preferred securities are payable
solely out of the proceeds of payments on account of such Debt securities; and
(c) the obligations recorded on the Consolidated balance sheet of the Borrower
and its Subsidiaries with respect to Debt securities of the type described in
clause (a) above and preferred securities of the type described in clause (b)
above.
"Quarterly Statement" means, with respect to any Insurance Company
Subsidiary, the statutory quarterly financial statement of such Insurance
Company Subsidiary as is required to be filed with the applicable Governmental
Authority of its state of domicile, with all exhibits and schedules filed
therewith.
"Register" shall have the meaning assigned thereto in Section 12.10(d).
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System of the United States.
"Required Lenders" means, at any date, any combination of holders of
51% or more of the aggregate unpaid principal amount of the Revolving Credit
Notes, or if no amounts are outstanding under the Revolving Credit Notes, any
combination of Lenders whose Revolving Credit Commitment Percentages aggregate
51% or more.
"Restricted Margin Stock" means Margin Stock owned by the Borrower or
any Subsidiary which represents not more than 33-1/3% of the aggregate value
(determined in accordance with Regulation U), on a consolidated basis, of the
property and assets of the Borrower and its Subsidiaries (other than any Margin
Stock) that is subject to the provisions of Sections 9.2 and 9.3.
"Revolving Credit Commitment" means, as to any Lender, the obligation
of such Lender to make Revolving Credit Loans to the Borrower hereunder in an
aggregate principal amount at any time outstanding not to exceed the amount set
forth below such Lender's name on the signature pages hereto, as the same may be
reduced or modified at any time or from time to time pursuant to Section 2.5 or
Section 12.10.
"Revolving Credit Commitment Percentage" means, as to any Lender at any
time, the ratio of (a) the amount of the Revolving Credit Commitment of such
Lender to (b) the Aggregate Revolving Credit Commitment of all of the Lenders.
"Revolving Credit Facility" means the revolving credit facility
established pursuant to Article 2.
"Revolving Credit Facility Fee" shall have the meaning assigned thereto
in Section 3.3(a).
"Revolving Credit Fee Payment Dates" means June 30, 1998, and the last
Business Day of each September, December, March and June thereafter occurring
prior to the Revolving Credit Termination Date.
"Revolving Credit Fee Percentage" means the percentage determined by
reference to the Applicable Category in effect from time to time as provided in
the following table:
Applicable Category Revolving Credit Fee Percentage
------------------- -------------------------------
Category 1 .085%
Category 2 .10%
Category 3 .125%
Category 4 .175%
Category 5 .225%
"Revolving Credit Loans" means the revolving credit loans made to the
Borrower pursuant to Section 2.1; "Revolving Credit Loan" means any of such
revolving credit loans.
"Revolving Credit Notes" means the separate Revolving Credit Notes made
by the Borrower payable to the order of each Lender, substantially in the form
of Exhibit A hereto, evidencing the Revolving Credit Loans, and any amendments
and modifications thereto, any substitutes therefor, and any replacements,
restatements, renewals or extensions thereof, in whole or in part; "Revolving
Credit Note" means any of such Revolving Credit Notes.
"Revolving Credit Termination Date" means April 23, 2003.
"SAP" means, with respect to any Insurance Company Subsidiary, the
accounting practices and procedures required to be complied with by such
Insurance Company Subsidiary under the statutes of its state of domicile and
under the rules and regulations of the applicable Governmental Authority of that
state.
"SEC" means the Securities and Exchange Commission and any successor
thereto.
"Statutory Surplus" means, with respect to each Insurance Company
Subsidiary, the "surplus as regards policyholders" as of the end of each of its
fiscal quarters, as reported on line 25, page 3, column 1 of the Annual Report
of such Insurance Company Subsidiary in the case of calculations made as of the
last day of any fiscal year of such Insurance Company Subsidiary, and as
reported on the applicable Quarterly Statement of such Insurance Company
Subsidiary in the case of calculations made as of the last day of any first,
second or third quarter of such Insurance Company Subsidiary.
"S&P" means Standard and Poor's Ratings Group, a division of
XxXxxx-Xxxx Companies, Inc.
"Stockholders' Equity" means, with respect to the Borrower and its
Subsidiaries at any date, the stockholders' equity of the Borrower and its
Subsidiaries determined on a consolidated basis in accordance with GAAP,
provided that, for purposes hereof, Stockholders' Equity shall be determined
without regard to the requirements of FASB 115.
"Subsidiary" means as to any Person, any corporation, partnership or
other entity of which more than fifty percent (50%) of the outstanding capital
stock or other ownership interests having ordinary voting power to elect a
majority of the board of directors or other managers of such corporation,
partnership or other entity is at the time, directly or indirectly, owned by or
the management is otherwise controlled by such Person (irrespective of whether,
at the time, capital stock of any other class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency). Unless otherwise qualified, references to "Subsidiary" or
"Subsidiaries" herein shall refer to those of the Borrower.
"Taxes" shall have the meaning assigned thereto in Section 3.11(a).
"Termination Event" means: (a) a "Reportable Event" described in
Section 4043 of ERISA which is required to be reported to the PBGC, or (b) the
withdrawal of the Borrower or any ERISA Affiliate from a Pension Plan during a
plan year in which it was a "substantial employer" as defined in Section 4001(a)
(2) of ERISA, or (c) the termination of a Material Pension Plan, the filing of a
notice of intent to terminate a Material Pension Plan or the treatment of a
Material Pension Plan amendment as a termination under Section 4041 of ERISA, or
(d) the institution of proceedings to terminate, or the appointment of a trustee
with respect to, any Pension Plan by the PBGC, or (e) any other event or
condition which would constitute grounds under Section 4042(a) of ERISA for the
termination of, or the appointment of a trustee to administer, any Pension Plan,
or (f) the partial or complete withdrawal of the Borrower or any ERISA Affiliate
from a Multiemployer Plan, or (g) the imposition of a Lien pursuant to Section
412 of the Code or Section 302 of ERISA, or (h) any event or condition which
results in the reorganization or insolvency of a Multiemployer Plan under
Sections 4241 or 4245 of ERISA, or (i) any event or condition which results in
the termination of a Multiemployer Plan under Section 4041A of ERISA or the
institution by the PBGC of proceedings to terminate a Multiemployer Plan under
Section 4042 of ERISA.
"Unfunded Liabilities" means, with respect to any Pension Plan at any
time, the amount, if any, by which (i) the value of all benefit liabilities
under such Pension Plan, determined on a plan termination basis using the
assumptions prescribed by the PBGC for purposes of Section 4044 of ERISA,
exceeds (ii) the fair market value of all plan assets allocable to such
liabilities under Title IV of ERISA (excluding any accrued but unpaid
contributions), all determined as of the then most recent valuation date for
such Pension Plan, but only to the extent that such excess represents a
potential liability of a member of the applicable ERISA group to the PBGC or any
other Person under Title IV of ERISA.
"United States" means the United States of America.
"Unrestricted Margin Stock" means any Margin Stock owned by the
Borrower or any Subsidiary which is not Restricted Margin Stock.
"Wholly-Owned" means, with respect to a Subsidiary, a Subsidiary all of
the shares of capital stock or other ownership interests of which are, directly
or indirectly, owned or controlled by the Borrower and/or one or more of its
Wholly-Owned Subsidiaries.
Section 1.2. General. Unless otherwise specified, a reference in this
Agreement to a particular section, subsection, Schedule or Exhibit is a
reference to that section, subsection, Schedule or Exhibit of this Agreement.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and plural, and pronouns stated in
the masculine, feminine or neuter gender shall include the masculine, the
feminine and the neuter. Any reference herein to "Charlotte time" shall refer to
the applicable time of day in Charlotte, North Carolina.
Section 1.3. Other Definitions and Provisions.
(a) Use of Capitalized Terms. Unless otherwise defined therein, all
capitalized terms defined in this Agreement shall have the defined meanings when
used in this Agreement, the Revolving Credit Notes and the other Loan Documents
or any certificate, report or other document made or delivered pursuant to this
Agreement.
(b) Miscellaneous. The words "hereof", "herein" and "hereunder" and
words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
ARTICLE 2
REVOLVING CREDIT FACILITY
Section 2.1. Revolving Credit Loans. Subject to the terms and
conditions of this Agreement, each Lender severally agrees to make Revolving
Credit Loans to the Borrower from time to time from the Closing Date through the
Revolving Credit Termination Date as requested by the Borrower in accordance
with the terms of Section 2.2; provided that (a) the aggregate principal amount
of all outstanding Revolving Credit Loans (after giving effect to any amount
requested) shall not exceed the Aggregate Revolving Credit Commitment, and (b)
the principal amount of outstanding Revolving Credit Loans from any Lender to
the Borrower shall not at any time exceed such Lender's Revolving Credit
Commitment. Each Revolving Credit Loan by a Lender shall be in a principal
amount equal to such Lender's Revolving Credit Commitment Percentage of the
aggregate principal amount of Revolving Credit Loans requested on such occasion.
Subject to the terms and conditions hereof, the Borrower may borrow, repay and
reborrow Revolving Credit Loans hereunder until the Revolving Credit Termination
Date.
Section 2.2. Procedure for Advances of Loans.
(a) Requests for Borrowing. The Borrower shall give the Agent
irrevocable prior written notice in the form attached hereto as Exhibit B (a
"Notice of Borrowing"), not later than 11:00 a.m. (Charlotte time) (i) at least
one (1) Business Day before the Revolving Credit Loans are to be advanced in the
event that the Revolving Credit Loans will initially be made as Base Rate Loans,
(ii) at least two (2) Business Days before the Revolving Credit Loans are to be
advanced in the event that the Revolving Credit Loans will initially be made as
CD Rate Loans, and (iii) at least three (3) Business Days before the Revolving
Credit Loans are to be advanced in the event that the Revolving Credit Loans
will initially be made as LIBOR Rate Loans, of its intention to borrow,
specifying (A) the date of such borrowing, which shall be a Business Day, (B)
the amount of such borrowing, which shall be (x) with respect to Base Rate Loans
in an aggregate principal amount of $1,000,000 or a whole multiple of $500,000
in excess thereof, and (y) with respect to Fixed Rate Loans in an aggregate
principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess
thereof, (C) whether the Revolving Credit Loans are initially to be Base Rate
Loans, CD Rate Loans or LIBOR Rate Loans, and (D) in the case of CD Rate Loans
or LIBOR Rate Loans, the duration of the initial Interest Period applicable
thereto. Notices received after 11:00 a.m. (Charlotte time) shall be deemed
received on the next Business Day. The Agent shall promptly notify the Lenders
of its receipt of each Notice of Borrowing. The Borrower acknowledges and agrees
that no Revolving Credit Loans shall be permitted to bear interest based on the
CD Rate or the LIBOR Rate until three (3) Business Days after the Closing Date.
(b) Disbursement of Loans. Not later than 1:00 p.m. (Charlotte time) on
the proposed borrowing date, each Lender will make available to the Agent, for
the account of the Borrower, at the office of the Agent in funds immediately
available to the Agent, such Lender's Revolving Credit Commitment Percentage of
the Revolving Credit Loans to be made on such borrowing date. The Borrower
hereby irrevocably authorizes the Agent to disburse the proceeds of each
borrowing requested pursuant to this Section 2.2 in immediately available funds
by crediting such proceeds to a deposit account of the Borrower maintained with
the Agent or by wire transfer to such account as may be agreed upon by the
Borrower and the Agent from time to time which account must be specified on the
most recent Notice of Account Designation delivered to the Agent. Subject to the
terms of the next paragraph, the Agent shall not be obligated to disburse a
Lender's ratable portion of any Revolving Credit Loans requested pursuant to
this Section 2.2 until such Lender shall have made available to the Agent its
ratable portion of such Revolving Credit Loans.
Unless the Agent shall have received written notice from a
Lender prior to 1:00 p.m. (Charlotte time) on a proposed borrowing date with
respect to Revolving Credit Loans that such Lender will not make available to
the Agent such Lender's ratable portion of the amount to be borrowed on such
date (which notice shall not release such Lender of its obligations hereunder),
the Agent may assume that such Lender has made such portion available to the
Agent in immediately available funds on the proposed borrowing date as provided
above, and the Agent may, in reliance upon such assumption, but shall not be
obligated to, make available to the Borrower on such date a corresponding
amount. If and to the extent that such Lender shall not have made such portion
available to the Agent, and the Agent shall have made such corresponding amount
available to the Borrower, such Lender, on the one hand, and the Borrower, on
the other, severally agree to pay to the Agent forthwith on demand such
corresponding amount, together with interest thereon for each day from the date
such amount is made available to the Borrower until the date such amount is
repaid to the Agent, (i) in the case of such Lender, at the Federal Funds Rate,
and (ii) in the case of the Borrower, at the rate of interest applicable at such
time to the Revolving Credit Loans comprising such borrowing. If such Lender
shall pay to the Agent such corresponding amount, such amount shall constitute
such Lender's Revolving Credit Loan as part of such borrowing for purposes of
this Agreement.
The obligations of the Lenders under this Agreement to make
the Revolving Credit Loans are several and are not joint and several. The
failure of any Lender to make its ratable portion of any Revolving Credit Loan
available shall not relieve it or any other Lender of its obligation, if any,
hereunder to make its ratable portion of such Revolving Credit Loan available on
the applicable borrowing date, but no Lender shall be responsible for the
failure of any other Lender to make its ratable portion of such Revolving Credit
Loan available on the borrowing date.
Section 2.3. Repayment of Revolving Credit Loans.
(a) Repayment on Revolving Credit Termination Date. The Borrower shall
repay the outstanding principal amount of all Revolving Credit Loans in full,
together with all accrued but unpaid interest thereon, on the Revolving Credit
Termination Date or on the date of any earlier termination of the Revolving
Credit Facility.
(b) Mandatory Repayment of Excess Loans. If at any time the outstanding
principal amount of all Revolving Credit Loans exceeds the Aggregate Revolving
Credit Commitment, the Borrower shall repay immediately upon notice from the
Agent, by payment to the Agent for the account of the Lenders, the Revolving
Credit Loans in an amount equal to such excess. Each such repayment shall be
accompanied by accrued interest on the amount repaid and any amount required to
be paid pursuant to Section 3.9.
(c) Optional Repayments. The Borrower may at any time and from time to
time repay, without premium or penalty except as provided in (d) below, the
Revolving Credit Loans, in whole or in part, upon at least one (1) Business
Day's irrevocable written notice to the Agent with respect to Base Rate Loans,
two (2) Business Days' irrevocable written notice to the Agent with respect to
CD Rate Loans, and three (3) Business Days' irrevocable written notice to the
Agent with respect to LIBOR Rate Loans, in each case given not later than 11:00
a.m. (Charlotte time) on the applicable Business Day, which written notice shall
be in the form attached hereto as Exhibit C (a "Notice of Repayment") and which
written notice shall specify the date and amount of repayment and whether the
repayment is of Base Rate Loans, CD Rate Loans, LIBOR Rate Loans, or a
combination thereof, and, if a combination thereof, the amount allocable to
each. Upon receipt of such notice, the Agent shall promptly notify each Lender.
If any such notice is given, the amount specified in such notice shall be due
and payable on the date set forth in such notice. Partial repayments shall be in
an aggregate amount of $1,000,000 or a whole multiple of $500,000 in excess
thereof with respect to Base Rate Loans, and $5,000,000 or a whole multiple of
$1,000,000 in excess thereof with respect to Fixed Rate Loans.
(d) Limitation on Repayment of Fixed Rate Loans. The Borrower may not
repay or prepay the Revolving Credit Loans while they constitute Fixed Rate
Loans on any day other than the last day of an Interest Period applicable
thereto unless such repayment or prepayment is accompanied by any amount
required to be paid in connection therewith pursuant to Section 3.9.
Section 2.4. Revolving Credit Notes. Each Lender's Revolving Credit
Loans and the obligation of the Borrower to repay such Revolving Credit Loans
shall be evidenced by a Revolving Credit Note executed by the Borrower payable
to the order of such Lender representing the Borrower's obligation to pay such
Lender's Revolving Credit Commitment or, if less, the aggregate unpaid principal
amount of all Revolving Credit Loans made and to be made by such Lender to the
Borrower hereunder, plus interest and all other fees, charges and other amounts
due thereon. Each Revolving Credit Note shall be dated the Closing Date and
shall bear interest on the unpaid principal amount thereof at the applicable
interest rate per annum specified in Section 3.1.
Section 2.5. Permanent Reduction of the Aggregate Commitment.
(a) The Borrower shall have the right at any time and from time to
time, upon at least five (5) Business Days' prior written notice to the Agent,
to permanently reduce, in whole at any time or in part from time to time,
without premium or penalty except as provided herein, the Aggregate Revolving
Credit Commitment in an aggregate principal amount not less than $5,000,000 or
any whole multiple of $5,000,000 in excess thereof. Each permanent reduction
permitted pursuant to this Section 2.5(a) shall be accompanied by a payment of
principal sufficient to reduce the aggregate outstanding Revolving Credit Loans
of the Lenders after such reduction to the Aggregate Revolving Credit Commitment
as so reduced and by payment of accrued interest on the amount of such repaid
principal. Any reduction of the Aggregate Revolving Credit Commitment to zero
shall, if such reduction is permanent, result in the termination of the
Revolving Credit Commitments and the Revolving Credit Facility and shall be
accompanied by a payment of all accrued fees.
(b) If any reduction of the Aggregate Revolving Credit Commitment
requires the repayment of any Fixed Rate Loan, such reduction may be made only
on the last day of the then current Interest Period applicable thereto unless
such repayment is accompanied by any amount required to be paid in connection
therewith pursuant to Section 3.9.
Section 2.6. Termination of Revolving Credit Facility. The Revolving
Credit Facility shall terminate on the earliest of (a) the Revolving Credit
Termination Date, (b) the date of termination by the Borrower pursuant to
Section 2.5(a), and (c) the date of termination by the Agent on behalf of the
Lenders pursuant to Section 10.2(a).
Section 2.7. Use of Proceeds. The Borrower shall use the proceeds of
the Revolving Credit Loans to finance permitted acquisitions and for the working
capital and general corporate purposes of the Borrower.
ARTICLE 3
GENERAL LOAN PROVISIONS
Section 3.1. Interest.
(a) Interest Rate Options. Subject to the provisions of this Section
3.1, at the election of the Borrower, the aggregate principal balance of the
Revolving Credit Loans or any permitted portion thereof shall bear interest at
the Base Rate, the CD Rate or the LIBOR Rate, plus, in each case, the Applicable
Margin as set forth below. The Borrower shall select the rate of interest and
Interest Period, if any, applicable to any Revolving Credit Loan at the time a
Notice of Borrowing is given pursuant to Section 2.2 with respect thereto and at
the time each Notice of Conversion/Continuation is given pursuant to Section 3.2
with respect thereto. Each Revolving Credit Loan or portion thereof bearing
interest based on the Base Rate shall be a "Base Rate Loan," each Revolving
Credit Loan or portion thereof bearing interest based on the CD Rate shall be a
"CD Rate Loan," and each Revolving Credit Loan or portion thereof bearing
interest based on the LIBOR Rate shall be a "LIBOR Rate Loan." For any period
with respect to which the Borrower has not duly specified an interest rate for
any Revolving Credit Loan or any portion thereof, such Revolving Credit Loan or
portion thereof shall be a Base Rate Loan.
(b) Interest Periods. In connection with each Revolving Credit Loan or
any portion thereof, the Borrower, by giving notice at the times described in
Section 3.1(a), shall elect an Interest Period to be applicable to such
Revolving Credit Loan. There shall be no more than seven (7) Interest Periods
relating to the Revolving Credit Loans outstanding at any time.
(c) Applicable Margin. The Applicable Margins provided for in Section
3.1(a) with respect to the Revolving Credit Loans shall (i) on the Closing Date
equal the applicable percentages set forth in the certificate delivered pursuant
to Section 4.2(d)(iii), and (ii) at all times thereafter be determined from time
to time by reference to the senior debt credit ratings for the Borrower as
provided in the definition of Applicable Margin set forth in Section 1.1. Any
change in the Applicable Margins resulting from a change in any senior debt
credit rating for the Borrower shall be effective as of the date which is ten
(10) Business Days after the day on which the credit rating change is first
announced by the applicable rating agency.
(d) Default Rate. Upon the occurrence and during the continuance of an
Event of Default, (i) the Borrower shall no longer have the option to request
Fixed Rate Loans, (ii) each outstanding Fixed Rate Loan shall bear interest at a
rate per annum two percent (2%) in excess of the rate then otherwise applicable
to such Fixed Rate Loan until the end of the then current Interest Period and
thereafter at a rate equal to two percent (2%) in excess of the rate then
applicable to Base Rate Loans, and (iii) all outstanding Base Rate Loans shall
bear interest at a rate per annum which is two percent (2%) above the rate then
applicable to Base Rate Loans. Interest shall continue to accrue on the
Revolving Credit Notes after the filing by or against the Borrower of any
petition seeking any relief in bankruptcy or under any act or law pertaining to
insolvency or debtor relief, whether state, federal or foreign.
(e) Interest Payment and Computation. Interest on each Base Rate Loan
shall be payable in arrears on the last Business Day of each calendar quarter
commencing June 30, 1998, and at maturity (whether by acceleration or
otherwise). Interest on each Fixed Rate Loan shall be payable on the last day of
each Interest Period applicable thereto, on the last day of each three (3) month
period during the applicable Interest Period in the case of a Fixed Rate Loan
having an Interest Period longer than three (3) months, and at maturity (whether
by acceleration or otherwise). All interest rates, fees and commissions provided
hereunder shall be computed on the basis of a 360-day year and assessed for the
actual number of days elapsed, except that interest with respect to each Base
Rate Loan shall be computed on the basis of a 365 or 366 day year, as
applicable.
(f) Maximum Rate. In no contingency or event whatsoever shall the
aggregate of all amounts deemed interest hereunder or under any of the Revolving
Credit Notes charged or collected pursuant to the terms of this Agreement or
pursuant to any of the Revolving Credit Notes exceed the highest rate
permissible under any Applicable Law which a court of competent jurisdiction
shall, in a final determination, deem applicable hereto. In the event that such
a court determines that the Lenders have charged or received interest hereunder
in excess of the highest applicable rate, the rate in effect hereunder shall
automatically be reduced to the maximum rate permitted by Applicable Law and the
Lenders shall at the Agent's option promptly refund to the Borrower any interest
received by the Lenders in excess of the maximum lawful rate or shall apply such
excess to the principal balance of the Obligations. It is the intent hereof that
the Borrower not pay or contract to pay, and that neither the Agent nor any
Lender receive or contract to receive, directly or indirectly in any manner
whatsoever, interest in excess of that which may be paid by the Borrower under
Applicable Law.
Section 3.2. Notice and Manner of Conversion or Continuation of Loans.
Provided that no Event of Default has occurred and is then continuing, the
Borrower shall have the option with respect to the Revolving Credit Loans to (a)
convert at any time all or any portion of the outstanding Revolving Credit Loans
which constitute Base Rate Loans in a principal amount equal to $5,000,000 or
any whole multiple of $1,000,000 in excess thereof into one or more Fixed Rate
Loans, or (b) upon the expiration of any Interest Period, (i) convert all or any
part of the outstanding Revolving Credit Loans which constitute Fixed Rate Loans
in a principal amount equal to $1,000,000 or a whole multiple of $500,000 in
excess thereof into Base Rate Loans, (ii) convert all or any part of the
outstanding Revolving Credit Loans which constitute one type of Fixed Rate Loan
in a principal amount equal to $5,000,000 or any whole multiple of $1,000,000 in
excess thereof into the other type of Fixed Rate Loan, or (iii) continue such
Fixed Rate Loans as the same type of Fixed Rate Loan for an additional Interest
Period. Whenever the Borrower desires to convert or continue Revolving Credit
Loans as provided above, the Borrower shall give the Agent irrevocable prior
written notice in the form attached as Exhibit D (a "Notice of
Conversion/Continuation") not later than 11:00 a.m. (Charlotte time) one (1)
Business Day before the day on which a proposed conversion to a Base Rate Loan
is to be effective, two (2) Business Days before the day on which a proposed
conversion to or continuation as a CD Rate Loan is to be effective and three (3)
Business Days before the day on which a proposed conversion to or continuation
as a LIBOR Rate Loan is to be effective, specifying (A) the Revolving Credit
Loans to be converted or continued, and, in the case of any Fixed Rate Loan to
be converted or continued, the last day of the Interest Period therefor, (B) the
effective date of such conversion or continuation (which shall be a Business
Day), (C) the principal amount of such Revolving Credit Loans to be converted or
continued, and (D) the Interest Period to be applicable to any converted or
continued Fixed Rate Loan. The Agent shall promptly notify the Lenders of its
receipt of each such Notice of Conversion/Continuation.
Section 3.3. Fees.
(a) Revolving Credit Facility Fee. The Borrower shall pay to the Agent
for the account of the Lenders an annual revolving credit facility fee (the
"Revolving Credit Facility Fee") equal to the product of (i) the daily average
amount of the difference between the Aggregate Revolving Credit Commitment and
the aggregate outstanding Revolving Credit Loans, and (ii) the applicable
Revolving Credit Fee Percentage. The Revolving Credit Facility Fee shall accrue
from and including the Closing Date to and including the Revolving Credit
Termination Date. The Revolving Credit Facility Fee shall be payable quarterly
in arrears on each Revolving Credit Fee Payment Date and on the Revolving Credit
Termination Date, with the amount of each such installment being equal to (x)
the daily average amount of the difference between the Aggregate Revolving
Credit Commitment and the aggregate outstanding Revolving Credit Loans during
the applicable quarter or other period, multiplied by (y) the Revolving Credit
Fee Percentage in effect as of the date the applicable installment of the
Revolving Credit Facility Fee is due hereunder, multiplied by (z) a fraction,
the numerator of which equals the actual number of days in the applicable
quarter or other period and the denominator of which equals 360, based on the
number of days in the year in which the applicable quarter or other period
occurs. Each installment of the Revolving Credit Facility Fee received by the
Agent shall be distributed by the Agent to the Lenders ratably in accordance
with the Lenders' respective Revolving Credit Commitment Percentages.
(b) Revolving Credit Fee Percentage. The Revolving Credit Fee
Percentage to be used in calculating the Revolving Credit Facility Fee provided
for in Section 3.3(a) shall be determined from time to time by reference to the
senior debt credit ratings for the Borrower as provided in the definition of
Revolving Credit Fee Percentage set forth in Section 1.1. Any change in the
Revolving Credit Fee Percentage resulting from a change in any senior debt
credit rating for the Borrower shall be effective as of the date which is ten
(10) Business Days after the day on which the credit rating change is first
announced by the applicable rating agency.
(c) Other Fees. In order to compensate First Union for structuring and
syndicating the Revolving Credit Loans and for its obligations hereunder, the
Borrower agrees to pay to Capital Markets, for its account, the fees set forth
in the Fee Letter.
Section 3.4. Manner of Payment. Each payment by the Borrower on account
of the principal of or interest on the Revolving Credit Loans, and each payment
of any fee, commission or other amounts payable to the Lenders under this
Agreement or any Revolving Credit Note shall be made not later than 1:00 p.m.
(Charlotte time) on the date specified for payment under this Agreement to the
Agent for the account of the Lenders ratably in accordance with their respective
Revolving Credit Commitment Percentages, at the Agent's Office, in Dollars, in
immediately available funds and shall be made without any set-off, counterclaim
or deduction whatsoever. Any payment received after such time but before 2:00
p.m. (Charlotte time) on such day shall be deemed a payment on such date for the
purposes of Section 10.1, but for all other purposes shall be deemed to have
been made on the next succeeding Business Day. Any payment received after 2:00
p.m. (Charlotte time) shall be deemed to have been made on the next succeeding
Business Day for all purposes. Upon receipt by the Agent of each such payment,
the Agent shall credit each Lender's account with its ratable share of such
payment in accordance with such Lender's Revolving Credit Commitment Percentage
and shall wire advice of the amount of such credit to each Lender.
Subject to the definition of Interest Period contained herein, if any payment
under this Agreement or any Revolving Credit Note shall be specified to be made
upon a day which is not a Business Day, it shall be made on the next succeeding
day which is a Business Day and such extension of time shall, except in the case
of a scheduled interest payment, be included in computing interest.
Section 3.5. Crediting of Payments and Proceeds. In the event that the
Borrower shall fail to pay any of the Obligations when due and the Obligations
have been accelerated pursuant to Section 10.2, all payments received by the
Lenders upon the Revolving Credit Notes and the other Obligations and all net
proceeds from the enforcement of the Obligations shall be applied first to all
expenses then due and payable by the Borrower hereunder, then to all indemnity
obligations then due and payable by the Borrower hereunder, then to all Agent's
fees, if any, then due and payable, then to all Revolving Credit Facility Fees
and other fees then due and payable, then to accrued and unpaid interest on the
Revolving Credit Notes, and then to the principal amount of the Revolving Credit
Notes (ratably in accordance with all such amounts due), in that order.
Section 3.6. Adjustments. If any Lender (a "Benefited Lender") shall at
any time receive any payment of all or any part of its Revolving Credit Loans,
or interest thereon, or if any Lender shall at any time receive any collateral
in respect to its Revolving Credit Loans (whether voluntarily or involuntarily,
by set-off or otherwise) in a greater proportion than any such payment to and
collateral received by any other Lender, if any, in respect of such other
Lender's Revolving Credit Loans, or interest thereon, such Benefited Lender
shall purchase for cash from the other Lenders such portion of each such other
Lender's Revolving Credit Loans, or shall provide such other Lenders with the
benefits of any such collateral, or the proceeds thereof, as shall be necessary
to cause such Benefited Lender to share the excess payment or benefits of such
collateral or proceeds ratably with each of the Lenders; provided that if all or
any portion of such excess payment or benefits is thereafter recovered from such
Benefited Lender, such purchase shall be rescinded, and the purchase price and
benefits returned to the extent of such recovery, but without interest. The
Borrower agrees that each Lender so purchasing a portion of another Lender's
Revolving Credit Loans may exercise all rights of payment (including, without
limitation, rights of set-off) with respect to such portion as fully as if such
Lender were the direct holder of such portion.
Section 3.7. Intentionally Omitted.
Section 3.8. Changed Circumstances.
(a) Circumstances Affecting LIBOR Rate Availability. If, on or prior to
the first day of any Interest Period, (y) the Agent shall have determined that
adequate and reasonable means do not exist for ascertaining the applicable LIBOR
Rate for such Interest Period or (z) the Agent shall have received written
notice from the Required Lenders of their determination that the rate of
interest referred to in the definition of "LIBOR Rate" upon the basis of which
the LIBOR Rate for LIBOR Rate Loans for such Interest Period is to be determined
will not adequately and fairly reflect the cost to such Lenders of making or
maintaining LIBOR Rate Loans during such Interest Period, the Agent will
forthwith so notify the Borrower and the Lenders. Upon such notice, (i) all then
outstanding LIBOR Rate Loans shall automatically, on the expiration date of the
respective Interest Periods applicable thereto (unless then repaid in full), be
converted into Base Rate Loans or CD Rate Loans, (ii) the obligation of the
Lenders to make, to convert Base Rate Loans or CD Rate Loans into, or to
continue LIBOR Rate Loans shall be suspended, and (iii) any Notice of Borrowing
or Notice of Conversion/Continuation given at any time thereafter with respect
to LIBOR Rate Loans shall be deemed to be a request for Base Rate Loans, in each
case until the Agent or the Required Lenders, as the case may be, shall have
determined that the circumstances giving rise to such suspension no longer exist
(and the Required Lenders, if making such determination, shall have so notified
the Agent), and the Agent shall have so notified the Borrower and the Lenders.
Notwithstanding the foregoing, the Agent and each Lender will take any
reasonable actions available to it (including designation of a different Lending
Office), consistent with legal and regulatory restrictions, that will avoid the
need to take the steps described in this Section 3.8(a) and that will not, in
the reasonable judgment of the Agent or such Lender, be materially
disadvantageous to it.
(b) Laws Affecting LIBOR Rate Availability. Notwithstanding any other
provision in this Agreement, if, at any time after the date hereof and from time
to time, any Lender shall have determined in good faith that the introduction of
or any change in any applicable law, rule or regulation or in the interpretation
or administration thereof by any Governmental Authority charged with the
interpretation or administration thereof, or compliance with any guideline or
request from any such Government Authority (whether or not having the force of
law), has or would have the effect of making it unlawful for such Lender to make
or to continue to make or maintain LIBOR Rate Loans, such Lender will forthwith
so notify the Agent and the Borrower. Upon such notice, (i) each of such
Lender's then outstanding LIBOR Rate Loans shall automatically, on the
expiration date of the respective Interest Period applicable thereto (or, to the
extent any such LIBOR Rate Loan may not lawfully be maintained as a LIBOR Rate
Loan until such expiration date, upon such notice), be converted into a Base
Rate Loan, (ii) the obligation of such Lender to make, to convert Base Rate
Loans or CD Rate Loans into, or to continue LIBOR Rate Loans shall be suspended,
and (iii) any Notice of Borrowing or Notice of Conversion/Continuation given at
any time thereafter with respect to LIBOR Rate Loans shall, as to such Lender,
be deemed to be a request for a Base Rate Loan, in each case until such Lender
shall have determined that the circumstances giving rise to such suspension no
longer exist and shall have so notified the Agent, and the Agent shall have so
notified the Borrower. Notwithstanding the foregoing, the Agent and each Lender
will take any reasonable actions available to it (including designation of a
different Lending Office), consistent with legal and regulatory restrictions,
that will avoid the need to take the steps described in this Section 3.8(b) and
that will not, in the reasonable judgment of the Agent or such Lender, be
materially disadvantageous to it.
(c) Increased Costs. If, after the date hereof, the introduction of, or
any change in, any Applicable Law, or any change in the interpretation or
administration thereof by any Governmental Authority, central bank or comparable
agency charged with the interpretation or administration thereof, or compliance
by any of the Lenders (or any of their respective Lending Offices) with any
request or directive (whether or not having the force of law) of such
Governmental Authority, central bank or comparable agency:
(i) shall subject any of the Lenders (or any of their
respective Lending Offices) to any tax, duty or other charge with respect to any
Revolving Credit Note or shall change the basis of taxation of payments to any
of the Lenders (or any of their respective Lending Offices) of the principal of
or interest on any Revolving Credit Note or any other amounts due under this
Agreement in respect thereof (except for changes in the rate of tax on the
overall net income of any of the Lenders or any of their respective Lending
Offices imposed by the jurisdiction in which such Lender is organized or is or
should be qualified to do business or such Lending Office is located); or
(ii) shall impose, modify or deem applicable any reserve
(including, without limitation, any imposed by the Board of Governors of the
Federal Reserve System), special deposit, insurance or capital or similar
requirement against assets of, deposits with or for the account of, or credit
extended by any of the Lenders (or any of their respective Lending Offices) or
shall impose on any of the Lenders (or any of their respective Lending Offices)
or the foreign exchange and interbank markets any other condition affecting any
Revolving Credit Note;
and the result of any of the foregoing is to increase the costs to any of the
Lenders of maintaining any LIBOR Rate Loan or to reduce the yield or amount of
any sum received or receivable by any of the Lenders under this Agreement or
under the Revolving Credit Notes in respect of a LIBOR Rate Loan, then such
Lender shall promptly notify the Agent, and the Agent shall promptly notify the
Borrower of such fact and demand compensation therefor and, within thirty (30)
days after such notice by the Agent and receipt of the certificate described
below, the Borrower shall pay to such Lender such additional amount or amounts
as will compensate such Lender or Lenders for such increased cost or reduction.
The Agent will promptly notify the Borrower of any event of which it has
knowledge which will entitle such Lender to compensation pursuant to this
Section 3.8(c); provided that the Agent shall incur no liability whatsoever to
the Lenders or the Borrower in the event it fails to do so. The amount of such
compensation shall be determined based upon the assumption that such Lender
funded its ratable portion of the LIBOR Rate Loans in the London interbank
market and using any reasonable attribution or averaging methods which such
Lender deems appropriate and practical under the circumstances. A certificate of
such Lender setting forth the basis for determining such amount or amounts
necessary to compensate such Lender shall be forwarded to the Borrower through
the Agent and shall be presumed to be correct and binding in the absence of
proof of error.
Section 3.9. Indemnity. The Borrower hereby indemnifies each of the
Lenders against any loss or expense which may arise from such Lender's
obtaining, liquidating or employing deposits or other funds acquired to effect,
fund or maintain any Revolving Credit Loan (a) as a consequence of any failure
by the Borrower to make any payment when due of any amount due hereunder in
connection with a Fixed Rate Loan, (b) due to any failure of the Borrower to
borrow or continue or convert an interest rate on a date specified therefor in a
Notice of Borrowing or a Notice of Conversion/Continuation or (c) due to any
payment, prepayment or conversion of any Fixed Rate Loan on a date other than
the last day of the Interest Period therefor. The amount of such loss or expense
shall be determined based upon the assumption that such Lender funded its
ratable portion of the Fixed Rate Loan in the London interbank market or through
the purchase of an underlying deposit and using any reasonable attribution or
averaging methods which such Lender deems appropriate and practical under the
circumstances. A certificate of such Lender setting forth the basis for
determining such amount or amounts necessary to compensate such Lender shall be
forwarded to the Borrower through the Agent and shall be presumed to be correct
and binding in the absence of proof of error.
Section 3.10. Capital Requirements. If either (a) the introduction of,
or any change in, or in the interpretation by a Governmental Authority of, any
Applicable Law or (b) compliance with any guideline or request from any central
bank or comparable agency or other Governmental Authority (whether or not having
the force of law), has or would have the effect of reducing the rate of return
on the capital of, or has affected or would affect the amount of capital
required to be maintained by, any Lender or any corporation controlling such
Lender as a consequence of, or with reference to the Revolving Credit Commitment
below the rate which the Lender or such other corporation could have achieved
hereunder but for such introduction, change or compliance, then within five (5)
Business Days after written demand by any such Lender, the Borrower shall pay to
such Lender from time to time as specified by such Lender additional amounts
sufficient to compensate such Lender or other corporation for such reduction. A
certificate as to such amounts submitted to the Borrower and the Agent by such
Lender shall be presumed to be correct and binding in the absence of proof of
error.
Section 3.11. Taxes.
(a) Payments Free and Clear. Unless otherwise required by Applicable
Law, any and all payments by the Borrower hereunder or under the Revolving
Credit Notes shall be made free and clear of and without deduction for any and
all present or future taxes, levies, imposts, deductions, charges or
withholding, and all liabilities with respect thereto, excluding (i) in the case
of each Lender and the Agent, income and franchise taxes imposed by the
jurisdiction under the laws of which such Lender or the Agent (as the case may
be) is organized or is or should be qualified to do business or any political
subdivision thereof and (ii) in the case of each Lender, income and franchise
taxes imposed by the jurisdiction of such Lender's Lending Office or any
political subdivision thereof (all such non-excluded taxes, levies, imposts,
deductions, charges, withholdings and liabilities being hereinafter referred to
as "Taxes"). If the Borrower shall be required by law to deduct any Taxes from
or in respect of any sum payable hereunder or under any Revolving Credit Note to
any Lender or the Agent, (A) the sum payable shall be increased as may be
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 3.11) such Lender or
the Agent (as the case may be) receives an amount equal to the amount such party
would have received had no such deductions been made, (B) the Borrower shall
make such deductions, (C) the Borrower shall pay the full amount deducted to the
relevant taxing authority or other authority in accordance with applicable law,
and (D) the Borrower shall deliver to the Agent evidence of such payment to the
relevant taxing authority or other authority in the manner provided in Section
3.11(d).
(b) Stamp and Other Taxes. In addition, the Borrower shall pay any
present or future stamp, registration, recordation or documentary taxes or any
other similar fees or charges or excise or property taxes, levies of the United
States or any state or political subdivision thereof or any applicable foreign
jurisdiction which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this Agreement, the
Revolving Credit Loans, the other Loan Documents, or the perfection of any
rights or security interest in respect thereto (hereinafter referred to as
"Other Taxes").
(c) Indemnity. The Borrower shall indemnify each Lender and the Agent
for the full amount of Taxes and Other Taxes (including, without limitation, any
Taxes and Other Taxes imposed by any jurisdiction on amounts payable under this
Section 3.11) paid by such Lender or the Agent (as the case may be) and any
liability (including penalties, interest and expenses) arising therefrom or with
respect thereto, whether or not such Taxes or Other Taxes were correctly or
legally asserted. Such indemnification shall be made within thirty (30) days
from the date such Lender or the Agent (as the case may be) makes written demand
therefor.
(d) Evidence of Payment. Within thirty (30) days after the date of any
payment of Taxes or Other Taxes, the Borrower shall furnish to the Agent, at its
address referred to in Section 12.1, the original or a certified copy of a
receipt evidencing payment thereof or other evidence of payment satisfactory to
the Agent.
(e) Contests; Refunds. If the Borrower determines in good faith that a
reasonable basis exists for contesting any Taxes or Other Taxes, the relevant
Lender or the Agent, as applicable, shall cooperate with the Borrower in
challenging such Tax or Other Tax at the Borrower's expense if requested by the
Borrower. If any Lender or the Agent, as applicable, obtains a credit against or
receives a refund or reduction (whether by way of direct payment or by offset)
of any Tax or Other Tax for which payment has been made pursuant to this Section
3.11, which credit, refund or reduction in the good faith judgment of such
Lender or the Agent, as the case may be, (and without any obligation to disclose
its tax records) is allocable to such payment made under this Section 3.11, the
amount of such credit, refund or reduction (together with any interest received
thereon) promptly shall be paid to the Borrower to the extent payment has been
made in full by the Borrower pursuant to this Section 3.11.
(f) Tax Forms and Certificates. Each Lender organized under the laws of
a jurisdiction other than the United States, any State thereof or the District
of Columbia (a "Non-U.S. Lender") shall deliver to the Borrower and the Agent
(i) two properly completed and duly executed copies of Internal Revenue Service
Form 1001 or any successor form prescribed by the Internal Revenue Service,
certifying that such Lender is entitled to the benefits under an income tax
treaty to which the United States is a party which exempts the Lender from
United States withholding tax or reduces the rate of withholding tax on payments
of interest for the account of such Lender, (ii) two properly completed and duly
executed copies of Internal Revenue Service Form 4224 certifying that the income
receivable pursuant to this Agreement is effectively connected with the conduct
of a trade or business in the United States or (iii) in the case of a Lender
claiming exemption from United States withholding tax under Section 871(h) or
881(c) of the Code with respect to payments of "portfolio interest," a Form W-8,
or any successor form prescribed by the Internal Revenue Service, and a
certificate representing that such Lender is not a bank for purposes of Section
881(c) of the Code, is not a 10-percent shareholder (within the meaning of
Section 871(h)(3)(B) of the Code) of the Borrower and is not a controlled
foreign corporation related to the Borrower (within the meaning of Section
864(d)(4) of the Code). Such forms shall be delivered by each Non-U.S. Lender on
or before the date it becomes a party to this Agreement and on or before the
date, if any, such Non-U.S. Lender changes its applicable Lending Office by
designating a different applicable Lending Office (a "New Lending Office"). In
addition, each Non-U.S. Lender shall deliver such forms promptly upon the
obsolescence or invalidity of any form previously delivered by such Non-U.S.
Lender. Notwithstanding any other provision of this Section 3.11, a Non-U.S.
Lender shall not be required to deliver any form pursuant to this Section 3.11
that such Non-U.S. Lender is not legally able to deliver.
(g) Exclusions. The Borrower shall not be required to indemnify any
Non-U.S. Lender, or to pay any additional amount to any Non-U.S. Lender, in
respect of United States federal income tax pursuant to this Section 3.11 to the
extent that (i) the obligation to withhold amounts with respect to United States
federal income tax existed on the date such Non-U.S. Lender became a party to
this Agreement (or, in the case of an assignee or a participant, on the date
such Person became an assignee or participant hereunder) or, with respect to
payments to a New Lending Office, the date such Non-U.S. Lender designated such
New Lending Office with respect to the Revolving Credit Loans; provided,
however, that this clause (i) shall not apply to any assignee or Lending Office
that becomes an assignee or New Lending Office as a result of an assignment,
transfer or designation made at the request of the Borrower; and provided
further, however, that this clause (i) shall not apply to the extent the
indemnity payment or additional amounts that the assignee or participant (or the
Lender through a New Lending Office) would otherwise be entitled to receive
(without regard to this clause (i)) do not exceed the indemnity payment or
additional amounts that the Person making the assignment, participation or
transfer to such assignee or participant, or the Lender making the designation
of such New Lending Office, would have been entitled to receive in the absence
of such assignment, participation, transfer or designation, or (ii) the
obligation to pay such additional amounts would not have arisen but for the
failure of such Non-U.S. Lender to comply with the provisions of subsection (f)
above.
(h) Mitigation. If the Borrower is required to pay additional amounts
to or for the account of any Lender pursuant to this Section 3.11, then such
Lender will change the jurisdiction of its Lending Office if, in the judgment of
such Lender, such change (i) will eliminate or, if it is not possible to
eliminate, will reduce to the greatest extent possible any such additional
payment which may thereafter accrue and (ii) is not otherwise disadvantageous to
such Lender. Any Lender claiming any indemnity payment or additional amounts
payable pursuant to this Section 3.11 shall use reasonable efforts (consistent
with legal and regulatory restrictions) to file any certificate or document
reasonably requested in writing by the Borrower or to change the jurisdiction of
its Lending Office if the making of such a filing or change would avoid the need
for or reduce the amount of any such indemnity payment or additional amounts
that may thereafter accrue and would not, in the sole determination of such
Lender, be otherwise disadvantageous to such Lender.
(i) Survival. Without prejudice to the survival of any other agreement
of the Borrower hereunder, the agreements and obligations of the Borrower
contained in this Section 3.11 shall survive the payment in full of the
Obligations and the termination of the Revolving Credit Commitments.
Section 3.12. Replacement of Defaulting Lender. As long as no Default
or Event of Default has occurred and is continuing, the Borrower may replace any
Defaulting Lender with one or more Eligible Assignees acceptable to the Agent
(each, a "Replacement Lender"), in any case by giving written notice to the
Defaulting Lender and the Agent not more than thirty (30) days after the
occurrence of the event which causes the applicable Defaulting Lender to be a
Defaulting Lender. The replacement of the Defaulting Lender shall be effective
ten (10) Business Days following the date written notice of such replacement is
given to the Defaulting Lender and the Agent, subject to the satisfaction of the
following conditions: (A) the Defaulting Lender and the Replacement Lender(s)
shall have satisfied the conditions to assignment and assumption set forth in
Section 12.10(b) (with all fees payable pursuant to Section 12.10(b) to be paid
by the Borrower), and, in connection therewith, the Replacement Lender(s) shall
have paid to the Defaulting Lender an amount equal to the principal of and all
accrued but unpaid interest on all outstanding Revolving Credit Loans of the
Defaulting Lender and all accrued but unpaid fees owing to the Defaulting Lender
pursuant to Section 3.3, and (B) the Borrower shall have paid to the Agent for
the account of the Defaulting Lender an amount equal to all other Obligations
owing to the Defaulting Lender. For purposes of this Agreement, a "Defaulting
Lender" is any Lender (i) which has requested compensation from the Borrower
under Section 3.8(c), Section 3.10 or Section 3.11, or (ii) which has had its
obligation to make or maintain LIBOR Rate Loans suspended under Section 3.8(b).
ARTICLE 4
CLOSING; CONDITIONS OF CLOSING AND BORROWING
Section 4.1. Closing. The closing shall take place at the offices of
Xxxx & Valentine, L.L.P. in Richmond, Virginia at 10:00 a.m. on April 23, 1998,
or on such other date as the parties hereto shall mutually agree.
Section 4.2. Conditions to Closing and Initial Extensions of Credit.
The obligations of the Lenders to close this Agreement and to make the initial
Revolving Credit Loans are subject to the satisfaction of each of the following
conditions:
(a) Executed Loan Documents. This Agreement and each of the Revolving
Credit Notes shall have been duly authorized, executed and delivered to the
Agent by the parties thereto, shall be in full force and effect and no default
shall exist thereunder, and the Borrower shall have delivered original
counterparts thereof to the Agent.
(b) Closing Certificates; Etc.
(i) Officer's Certificate of the Borrower. The Agent shall
have received a certificate from the chief executive officer or chief financial
officer of the Borrower, in form and substance satisfactory to the Agent, to the
effect that all representations and warranties of the Borrower contained in this
Agreement and the other Loan Documents are true, correct and complete as if made
on the Closing Date; that the Borrower is not in violation of any of the
covenants contained in this Agreement and the other Loan Documents; that, after
giving effect to the transactions contemplated by this Agreement, no Default or
Event of Default has occurred and is continuing; and that the Borrower has
satisfied each of the closing conditions set forth in this Article 4.
(ii) Certificate of Secretary of the Borrower. The Agent shall
have received a certificate of the secretary or assistant secretary of the
Borrower certifying that attached thereto is a true and complete copy of the
articles of incorporation of the Borrower and all amendments thereto, certified
as of a recent date by the State Corporation Commission of Virginia; that
attached thereto is a true and complete copy of the bylaws of the Borrower as in
effect on the date of such certification; that attached thereto is a true and
complete copy of resolutions duly adopted by the Board of Directors of the
Borrower authorizing the borrowings contemplated hereunder and the execution,
delivery and performance of this Agreement and the other Loan Documents to which
it is a party; and as to the incumbency and genuineness of the signature of each
officer of the Borrower executing Loan Documents to which it is a party.
(iii) Certificates of Good Standing. The Agent shall have
received certificates as of a recent date of the good standing of the Borrower
and each of the Subsidiaries of the Borrower specified by the Agent, in each
case under the laws of its jurisdiction of organization.
(iv) Opinions of Counsel. The Agent shall have received a
favorable opinion of counsel to the Borrower addressed to the Agent and the
Lenders with respect to the Borrower, its Subsidiaries, the Loan Documents and
such other matters as the Lenders shall reasonably request.
(c) Consents; Defaults.
(i) Governmental and Third Party Approvals. All necessary
approvals, authorizations and consents, if any be required, of any Person and of
all Governmental Authorities and courts having jurisdiction with respect to the
transactions contemplated by this Agreement and the other Loan Documents shall
have been obtained.
(ii) No Injunction, Etc. No action, proceeding, investigation,
regulation or legislation shall have been instituted, threatened or proposed
before any Governmental Authority to enjoin, restrain, or prohibit, or to obtain
substantial damages in respect of, or which is related to or arises out of this
Agreement or the other Loan Documents or the consummation of the transactions
contemplated hereby or thereby, or which, in the Agent's discretion, would make
it inadvisable to consummate the transactions contemplated by this Agreement and
the other Loan Documents.
(iii) No Event of Default. No Default or Event of Default
shall have occurred and be continuing.
(d) Financial Matters.
(i) Financial Statements. The Agent shall have received the
most recent audited Consolidated financial statements of the Borrower and its
Subsidiaries, all in form and substance satisfactory to the Agent.
(ii) Payments at Closing. There shall have been paid by the
Borrower to the Agent and the Lenders any fees or commissions due on or before
the Closing Date (including, without limitation, legal fees and expenses), and
to any other Person such amount as may be due thereto in connection with the
transactions contemplated hereby, including all taxes, fees and other charges in
connection with the execution, delivery, recording, filing and registration of
any of the Loan Documents.
(iii) Applicable Margin Certificate. The Borrower shall have
delivered to the Agent a certificate executed by the chief financial officer of
the Borrower setting forth the calculation of the initial Applicable Margins
pursuant to Section 3.1(c).
(e) Existing Credit Facilities. The Borrower shall have delivered to
the Agent evidence satisfactory to the Agent that the Existing Credit Facilities
have been terminated or will be terminated upon the making of the initial
Revolving Credit Loans.
(f) Miscellaneous.
(i) Notices. The Agent shall have received a Notice of
Borrowing with respect to any Revolving Credit Loans to be made on the Closing
Date, a Notice of Account Designation and written instructions from the Borrower
to the Agent directing the payment of any proceeds of any Revolving Credit Loans
that are to be disbursed on the Closing Date to an account specified on such
Notice of Account Designation.
(ii) Proceedings and Documents. All opinions, certificates and
other instruments and all proceedings in connection with the transactions
contemplated by this Agreement shall be reasonably satisfactory in form and
substance to the Lenders. The Lenders shall have received copies of all other
instruments and other evidence as any Lender may reasonably request, in form and
substance satisfactory to the Lenders, with respect to the transactions
contemplated by this Agreement and the taking of all actions in connection
therewith.
(iii) Due Diligence and Other Documents. The Borrower shall
have delivered to the Agent such other documents, certificates and opinions as
the Agent reasonably requests, certified by a secretary or assistant secretary
of the Borrower as a true and correct copy thereof.
Section 4.3. Conditions to All Loans. The obligations of the Lenders to
make each Revolving Credit Loan are subject to the satisfaction of the following
conditions precedent on the relevant borrowing date:
(a) Continuation of Representations and Warranties. The representations
and warranties contained in Sections 5.1(a), 5.1(d), 5.1(e), 5.1(f), 5.1(g),
5.1(h)(vii), 5.1(i), 5.1(j), 5.1(k), 5.1(n), 5.1(r), 5.1(u), 5.1(v) and 5.1(w)
shall be true and correct on and as of such borrowing date with the same effect
as if made on and as of such date.
(b) No Existing Default. No Default or Event of Default shall have
occurred and be continuing hereunder on the borrowing date or after giving
effect to the Revolving Credit Loan or Revolving Credit Loans to be made on such
date.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF THE BORROWER
Section 5.1. Representations and Warranties. To induce the Agent and
the Lenders to enter into this Agreement and the Lenders to make the Revolving
Credit Loans, the Borrower hereby represents and warrants to the Agent and the
Lenders that:
(a) Organization; Power; Qualification. Each of the Borrower and its
Material Subsidiaries is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation or formation, has the
corporate power and authority to own its properties and to carry on its business
as now being conducted and is duly qualified and authorized to do business in
each jurisdiction in which the character of its properties or the nature or
transaction of its business requires such qualification and authorization,
except where a failure to be so qualified and authorized would not in any given
case or in the aggregate have a Material Adverse Effect.
(b) Ownership. Each Subsidiary of the Borrower is listed on Schedule
5.1(b), and the Borrower owns 100% of the capital stock of each such Subsidiary,
either directly or indirectly through the ownership of another Subsidiary. There
are no outstanding stock purchase warrants, subscriptions, options, securities,
instruments or other rights of any type or nature whatsoever, which are
convertible into, exchangeable for or otherwise provide for or permit the
issuance of capital stock of the Borrower or its Subsidiaries, except as
disclosed in the applicable filings of the Borrower with the SEC.
(c) Authorization of Agreement; Loan Documents and Borrowings. The
Borrower has the corporate power and authority and has taken all necessary
corporate and other action to authorize the execution, delivery and performance
of this Agreement and each of the other Loan Documents to which it is a party in
accordance with their respective terms. This Agreement and each of the other
Loan Documents have been duly executed and delivered by the duly authorized
officer of the Borrower, and each such document constitutes the legal, valid and
binding obligation of the Borrower, enforceable in accordance with its terms,
except as such enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar state or federal debtor relief laws from
time to time in effect which affect the enforcement of creditors' rights in
general and the availability of equitable remedies.
(d) Compliance of Agreement, Loan Documents and Borrowings with Laws,
Etc. The execution, delivery and performance by the Borrower of the Loan
Documents in accordance with their respective terms, the borrowings hereunder
and the transactions contemplated hereby do not and will not, by the passage of
time, the giving of notice or otherwise, (i) require any Governmental Approval
or violate any Applicable Law relating to the Borrower or any of its
Subsidiaries, (ii) conflict with, result in a breach of or constitute a default
under the articles of incorporation, bylaws or other organizational documents of
the Borrower or any indenture, agreement or other instrument to which the
Borrower or any Subsidiary is a party or by which any of their respective
properties may be bound or any Governmental Approval relating to such Person, or
(iii) result in or require the creation or imposition of any Lien upon or with
respect to any property now owned or hereafter acquired by the Borrower or any
Subsidiary.
(e) Compliance with Law; Governmental Approvals. Each of the Borrower
and its Subsidiaries (i) has all Governmental Approvals required by any
Applicable Law for it to conduct its business, each of which is in full force
and effect, is final and not subject to review on appeal and is not the subject
of any pending or, to the best of its knowledge, threatened attack by direct or
collateral proceeding, and (ii) is in compliance with each Governmental Approval
applicable to it and in compliance with all other Applicable Laws relating to it
or any of its respective properties; except where a failure to have such
Governmental Approvals or to be in compliance therewith would not in any given
case or in the aggregate have a Material Adverse Effect.
(f) Tax Returns and Payments. Each of the Borrower and its Subsidiaries
has duly filed or caused to be filed all federal, state, local and other tax
returns required by Applicable Law to be filed, and has paid, or made adequate
provision for the payment of, all federal, state, local and other taxes,
assessments and governmental charges or levies upon it and its property, income,
profits and assets which are due and payable, other than those which are not yet
delinquent and other than those which are being contested by the Borrower or
such Subsidiary in good faith and by appropriate proceedings and for which the
Borrower or such Subsidiary has established reserves as required by GAAP. No
Governmental Authority has asserted any Lien or other claim against the Borrower
or any Subsidiary with respect to unpaid taxes which has not been discharged or
resolved. The charges, accruals and reserves on the books of the Borrower and
any of its Subsidiaries in respect of federal, state, local and other taxes for
all Fiscal Years and portions thereof since the organization of the Borrower and
any of its Subsidiaries are in the judgment of the Borrower adequate, and the
Borrower does not anticipate any additional material taxes or assessments for
any of such years.
(g) Intellectual Property Matters. To the best of the Borrower's
knowledge, each of the Borrower and its Subsidiaries owns or possesses rights to
use all material franchises, licenses, copyrights, copyright applications,
patents, patent rights or licenses, patent applications, trademarks, trademark
rights, trade names, trade name rights, copyrights and rights with respect to
the foregoing which are required to conduct its business.
To the best of the Borrower's knowledge, no event has occurred which permits,
or after notice or lapse of time or both would permit, the revocation or
termination of any such rights which are material to the Borrower or its
Subsidiaries, and neither the Borrower nor any Subsidiary is liable in any
material respect to any Person for infringement under Applicable Law with
respect to any such rights as a result of its business operations.
(h) Environmental Matters.
(i) The properties of the Borrower and its Subsidiaries do not
contain, and to their knowledge have not previously contained, any Hazardous
Materials in amounts or concentrations which (A) constitute or constituted a
violation of, or (B) could give rise to any liability under, applicable
Environmental Laws;
(ii) To the best of the Borrower's knowledge, such properties
and all operations conducted in connection therewith are in compliance, and have
been in compliance, with all applicable Environmental Laws, and, to the best of
the Borrower's knowledge, there is no contamination at, under or about such
properties or such operations which could interfere with the continued operation
of any material property or properties of the Borrower and its Subsidiaries or
impair the fair salable value thereof;
(iii) Neither the Borrower nor any Subsidiary has received any
notice of violation, alleged violation, noncompliance, liability or potential
liability regarding environmental matters or compliance with Environmental Laws
with regard to any of their properties or the operations conducted in connection
therewith, nor does the Borrower or any Subsidiary have knowledge or reason to
believe that any such notice will be received or is being threatened;
(iv) Hazardous Materials have not been transported or disposed
of from the properties of the Borrower and its Subsidiaries in violation of, or
in a manner or to a location which could give rise to liability under,
Environmental Laws, nor have any Hazardous Materials been generated, treated,
stored or disposed of at, on or under any of such properties in violation of, or
in a manner that could give rise to any liability under, any applicable
Environmental Laws;
(v) No judicial proceedings or governmental or administrative
action is pending, or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which the Borrower or any Subsidiary is or will be named as
a party with respect to such properties or operations conducted in connection
therewith, nor are there any consent decrees or other decrees, consent orders,
administrative orders or other orders, or other administrative or judicial
requirements outstanding under any Environmental Law with respect to such
properties or such operations;
(vi) There has been no release, or to the best of the
Borrower's knowledge, the threat of release, of Hazardous Materials at or from
such properties, in violation of or in amounts or in a manner that could give
rise to liability under Environmental Laws; and
(vii) In the ordinary course of its business, the Borrower
conducts an ongoing review of the effect of Environmental Laws on the operations
and properties of the Borrower and its Subsidiaries, in the course of which it
identifies and evaluates associated liabilities and costs (including, without
limitation, any capital or operating expenditures required for clean-up or
closure of properties presently or previously owned, any capital or operating
expenditures required to achieve or maintain compliance with environmental
protection standards imposed by law or as a condition of any license, permit or
contract, any related constraints on operating activities, including any
periodic or permanent shutdown of any facility or reduction in the level of or
change in the nature of operations conducted thereat, any costs or liabilities
in connection with off-site disposal of wastes or Hazardous Materials and any
related costs and expenses). On the basis of this review, the Borrower has
reasonably concluded that such associated liabilities and costs, including the
costs of compliance with Environmental Laws, are unlikely to have a Material
Adverse Effect.
(i) ERISA.
(i) The Borrower and each ERISA Affiliate are in compliance in
all material respects with all applicable provisions of ERISA and the
regulations and published interpretations thereunder with respect to all
Employee Benefit Plans except for any required amendments for which the remedial
amendment period as defined in Section 401(b) of the Code has not yet expired.
Each Employee Benefit Plan that is intended to be qualified under Section 401(a)
of the Code has been determined by the Internal Revenue Service to be so
qualified, and each trust related to such plan has been determined to be exempt
under Section 501(a) of the Code. No liability has been incurred by the Borrower
or any ERISA Affiliate which remains unsatisfied for any taxes or penalties with
respect to any Employee Benefit Plan or any Multiemployer Plan;
(ii) No Material Pension Plan has been terminated, nor has any
accumulated funding deficiency (as defined in Section 412 of the Code) been
incurred (without regard to any waiver granted under Section 412 of the Code),
nor has any funding waiver from the Internal Revenue Service been received or
requested with respect to any Material Pension Plan, nor has the Borrower or any
ERISA Affiliate failed to make any contributions or to pay any amounts due and
owing as required by Section 412 of the Code, Section 302 of ERISA or the terms
of any Pension Plan prior to the due dates of such contributions under Section
412 of the Code or Section 302 of ERISA, nor has there been any event requiring
any disclosure under Section 4041(c) (3) (C) or 4063(a) of ERISA with respect to
any Pension Plan;
(iii) Neither the Borrower nor any ERISA Affiliate has: (A)
engaged in a nonexempt prohibited transaction described in Section 406 of ERISA
or Section 4975 of the Code, (B) incurred any liability to the PBGC which
remains outstanding other than the payment of premiums and there are no premium
payments which are due and unpaid, (C) failed to make a required contribution or
payment to a Multiemployer Plan, or (D) failed to make a required installment or
other required payment under Section 412 of the Code;
(iv) No Termination Event has occurred or is reasonably
expected to occur; and
(v) No proceeding, claim, lawsuit and/or investigation is
existing or, to the best knowledge of the Borrower, threatened concerning or
involving any (A) employee welfare benefit plan (as defined in Section 3(1) of
ERISA) currently maintained or contributed to by the Borrower or any ERISA
Affiliate, (B) Pension Plan or (C) Multiemployer Plan in which there is a
reasonable possibility of an adverse decision and which, if adversely
determined, could reasonably be expected to have a Material Adverse Effect.
(j) Margin Stock. Neither the Borrower nor any Subsidiary is engaged
principally or as one of its activities in the business of extending credit for
the purpose of "purchasing" or "carrying" (as each such term is defined or used
in Regulation U of the Board of Governors of the Federal Reserve System) any
Margin Stock. No part of the proceeds of any of the Revolving Credit Loans will
be used for purchasing or carrying Margin Stock in violation of the provisions
of Regulation T, U or X of the Board of Governors of the Federal Reserve System,
and, without limiting the generality of the foregoing, not more than 25% of the
value of the assets of the Borrower and its Subsidiaries, on a consolidated
basis, that are subject to the restrictions in Sections 9.2 or 9.3 will be
attributable to Margin Stock.
(k) Government Regulation. Neither the Borrower nor any Subsidiary is
an "investment company" or a company "controlled" by an "investment company" (as
each such term is defined or used in the Investment Company Act of 1940, as
amended), and neither the Borrower nor any Subsidiary is, or after giving effect
to the Revolving Credit Loans will be, subject to regulation under the Public
Utility Holding Company Act of 1935 or the Interstate Commerce Act, each as
amended, or any other Applicable Law which limits its ability to incur or
consummate the transactions contemplated hereby.
(l) Material Contracts. The Borrower and its Subsidiaries have no
Material Contracts except for those disclosed in the applicable filings of the
Borrower with the SEC. Each Material Contract of the Borrower and its
Subsidiaries is, and after giving effect to the consummation of the transactions
contemplated by the Loan Documents will be, in full force and effect in
accordance with the terms thereof.
(m) Intentionally Omitted.
(n) Burdensome Provisions. Neither the Borrower nor any Subsidiary is a
party to any indenture, agreement, lease or other instrument, or subject to any
corporate or partnership restriction, Governmental Approval or Applicable Law
which is so unusual or burdensome as in the foreseeable future could be
reasonably expected to have a Material Adverse Effect. The Borrower and its
Subsidiaries do not presently anticipate that future expenditures needed to meet
the provisions of any statutes, orders, rules or regulations of a Governmental
Authority will be so burdensome as to have a Material Adverse Effect.
(o) Financial Statements. The Consolidated balance sheet of the
Borrower and its Subsidiaries as of December 31, 1997, and the related
Consolidated statements of income and retained earnings and cash flows for the
Fiscal Year then ended, copies of which have been furnished to the Agent and
each Lender, are complete and correct and fairly present in accordance with GAAP
the assets, liabilities and financial position of the Borrower and its
Subsidiaries as at such date, and the results of the operations and changes of
financial position for the period then ended. All such financial statements,
including the related schedules and notes thereto, have been prepared in
accordance with GAAP. The Borrower and its Consolidated Subsidiaries have no
Debt, obligation or other unusual forward or long-term commitment which is not
fairly reflected in the foregoing financial statements or in the notes thereto.
(p) No Material Adverse Change. Since December 31, 1997, there has been
no material adverse change in the business, financial position or results of
operations of the Borrower and its Subsidiaries taken as a whole, and no event
has occurred or condition arisen that could reasonably be expected to have a
Material Adverse Effect.
(q) Intentionally Omitted.
(r) Year 2000 Compatibility. The Borrower and its Subsidiaries have
taken all appropriate actions necessary to assure that the material computer
based systems of the Borrower and its Subsidiaries are able to operate and
effectively process data which includes dates on and after January 1, 2000,
except where the failure to operate or process such dates would not have a
Material Adverse Effect.
(s) Liens. None of the properties and assets of the Borrower or any
Subsidiary is subject to any Lien, except Liens permitted pursuant to Section
9.2. All of the Liens on the properties and assets of the Borrower or any
Subsidiary existing as of the Closing Date which secure an amount in excess of
$10,000,000 are described on Schedule 9.2.
(t) Debt and Contingent Obligations. Schedule 5.1(t) is a complete and
correct listing of all Debt and Contingent Obligations of the Borrower and its
Subsidiaries in excess of $10,000,000. The Borrower and its Subsidiaries have
performed and are in compliance with all of the terms of such Debt and
Contingent Obligations and all instruments and agreements relating thereto, and
no default or event of default, or event or condition which with notice or lapse
of time or both would constitute such a default or event of default, on the part
of the Borrower or its Subsidiaries exists with respect to any such Debt or
Contingent Obligation.
(u) Litigation. There are no actions, suits or proceedings pending nor,
to the knowledge of the Borrower, threatened against or in any other way
relating adversely to or affecting the Borrower or any Subsidiary or any of
their respective properties in any court or before any arbitrator of any kind or
before or by any Governmental Authority in which there is a reasonable
possibility of an adverse decision and which, if adversely determined, could
reasonably be expected to have a Material Adverse Effect.
(v) Absence of Defaults. No event has occurred and is continuing which
constitutes a Default or an Event of Default, or which constitutes, or which
with the passage of time or giving of notice or both would constitute, a default
or event of default by the Borrower or any Subsidiary under any material
judgment, decree or order to which the Borrower or its Subsidiaries is a party
or by which the Borrower or its Subsidiaries or any of their respective
properties may be bound or which would require the Borrower or its Subsidiaries
to make any payment thereunder prior to the scheduled maturity date therefor.
(w) Accuracy and Completion of Information. All written information,
reports and other papers and data produced by or on behalf of the Borrower or
any Subsidiary and furnished to the Agent or the Lenders were, at the time the
same were so furnished, complete and correct in all material respects. No
document furnished or written statement made to the Agent or the Lenders by the
Borrower or any Subsidiary in connection with the negotiation, preparation or
execution of this Agreement or any of the Loan Documents contains or will
contain any untrue statement of a fact material to the creditworthiness of the
Borrower or its Subsidiaries or omits or will omit to state a fact necessary in
order to make the statements contained therein not misleading with respect to
the creditworthiness of the Borrower or its Subsidiaries. The Borrower is not
aware of any facts which it has not disclosed in writing to the Agent having a
Material Adverse Effect, or insofar as the Borrower can now foresee, could
reasonably be expected to have a Material Adverse Effect.
Section 5.2. Survival of Representations and Warranties, Etc. All
representations and warranties set forth in this Article 5 and all
representations and warranties contained in any certificate or any of the other
Loan Documents (including but not limited to any such representation or warranty
made in or in connection with any amendment thereto) shall constitute
representations and warranties made under this Agreement. All representations
and warranties made under this Agreement shall be made or deemed to be made at
and as of the Closing Date, shall survive the Closing Date and shall not be
waived by the execution and delivery of this Agreement, any investigation made
by or on behalf of the Lenders or any borrowing hereunder.
ARTICLE 6
FINANCIAL INFORMATION AND NOTICES
Until all the Obligations have been finally and indefeasibly paid and
satisfied in full and the Revolving Credit Commitments have been terminated,
unless consent has been obtained in the manner set forth in Section 12.11, the
Borrower will furnish or cause to be furnished to the Agent at the Agent's
Office and to each of the Lenders at its address listed on the signature pages
hereto, or at such other office or address as may be designated by the Agent or
any Lender from time to time:
Section 6.1. Financial Statements.
(a) as soon as available, but in no event more than sixty (60) days
after the end of each of the first three (3) Fiscal Quarters in each Fiscal
Year, the quarterly report of the Borrower on Form 10-Q (or other applicable
form) filed with the SEC, accompanied by a certificate of the chief financial
officer of the Borrower stating whether to his best knowledge and belief any
Default or Event of Default has occurred or exists hereunder, and, if any such
Default or Event of Default has occurred and is continuing or otherwise exists,
stating the facts with respect thereto;
(b) as soon as available, but in no event more than one hundred twenty
(120) days after the end of each Fiscal Year, a copy of the Consolidated
financial statements and annual audit report of the Borrower and its
Subsidiaries in reasonable detail, prepared in accordance with GAAP, and
certified without material qualification by KPMG Peat Marwick, LLP, or other
independent certified public accountants selected by the Borrower and reasonably
satisfactory to the Agent, which report shall include a Consolidated balance
sheet of the Borrower and its Subsidiaries as of the end of such Fiscal Year and
Consolidated statements of earnings, changes in stockholders' equity and cash
flows of the Borrower and its Subsidiaries for such Fiscal Year and a copy of
the annual report of the Borrower on Form 10-K (or other applicable form) filed
with the SEC, accompanied by (1) a certificate of KPMG Peat Marwick, LLP, or
other independent certified public accountants selected by the Borrower and
reasonably satisfactory to the Agent, stating whether to its best knowledge and
belief any Default or Event of Default has occurred or exists hereunder, (2) a
certificate of the chief financial officer of the Borrower stating whether to
his best knowledge and belief any Default or Event of Default has occurred or
exists hereunder, and, if any such Default or Event of Default has occurred and
is continuing or otherwise exists, stating the facts with respect thereto, and
(3) an internally prepared consolidating balance sheet as of the end of such
Fiscal Year and an internally prepared consolidating statement of income for the
Borrower and its Consolidated Subsidiaries for such Fiscal Year, in each case
prepared in accordance with GAAP;
(c) as soon as available, but in no event more than one hundred twenty
(120) days after the end of each fiscal year of each unconsolidated Subsidiary
or Affiliate of the Borrower (whose operations are accounted for in the
Consolidated financial statements of the Borrower on the equity method), if any,
a copy of the annual audit report of such corporation and its subsidiaries, if
any, in reasonable detail, prepared in accordance with GAAP (or SAP in the case
of a regulated insurance company) and certified by independent certified public
accountants of recognized standing, which report shall include a consolidated
balance sheet of each such Subsidiary or Affiliate and its subsidiaries, if any,
as of the end of such fiscal year and consolidated statements of income,
retained earnings, and cash flows for each such Subsidiary or Affiliate and its
subsidiaries, if any, for such fiscal year;
(d) promptly upon their becoming available but in no event (i) more
than ninety (90) days after the end of each calendar year in the case of the
Annual Statements or (ii) more than sixty (60) days after the end of each
calendar quarter in the case of the Quarterly Statements, a copy of each Annual
Statement and Quarterly Statement of each Insurance Company Subsidiary prepared
in accordance with SAP, and a copy of each externally-prepared actuarial
analysis of each Insurance Company Subsidiary obtained by the Borrower or any
Subsidiary;
(e) promptly upon their becoming available, copies of all financial
statements, reports, notices as to material matters, and proxy statements sent
by the Borrower or any of its Subsidiaries (which is not a Wholly-Owned
Subsidiary) to public stockholders and of all regular, periodic and special
reports filed by the Borrower or any of its Subsidiaries with any securities
exchange or with the SEC;
(f) together with the items described in clauses (a) and (b) above,
written calculations in form reasonably satisfactory to the Agent demonstrating
compliance by the Borrower with the financial covenants contained in Article 8;
and
(g) such additional information, reports or statements (financial or
otherwise) as the Agent or any Lender may from time to time reasonably request.
Section 6.2. Notice of Litigation and Other Matters. Promptly (but in
no event later than ten (10) days after an officer of the Borrower obtains
knowledge thereof) telephonic and written notice of:
(a) the commencement of all proceedings and investigations by or before
any Governmental Authority and all actions and proceedings in any court or
before any arbitrator against or involving the Borrower or any Subsidiary or any
of their respective properties, assets or businesses which in any given case or
in the aggregate could reasonably be expected to have a Material Adverse Effect;
(b) any notice of any violation received by the Borrower or any
Subsidiary from any Governmental Authority, including, without limitation, any
notice of violation of Environmental Laws, which in any such case could
reasonably be expected to have a Material Adverse Effect;
(c) any attachment, judgment, lien, levy or order exceeding $10,000,000
that may be assessed against or threatened against the Borrower or any
Subsidiary other than normal insurance claims adjustment matters involving
Insurance Company Subsidiaries;
(d) any Default or Event of Default, or any other event which
constitutes or which with the passage of time or giving of notice or both would
constitute a default or event of default under any Material Contract to which
the Borrower or any of its Subsidiaries is a party or by which the Borrower or
any Subsidiary or any of their respective properties may be bound;
(e) (i) any unfavorable determination letter from the Internal Revenue
Service regarding the qualification of an Employee Benefit Plan under Section
401(a) of the Code (along with a copy thereof), (ii) all notices received by the
Borrower or any ERISA Affiliate of the PBGC's intent to terminate any Pension
Plan or to have a trustee appointed to administer any Pension Plan, (iii) all
notices received by the Borrower or any ERISA Affiliate from a Multiemployer
Plan sponsor concerning the imposition or amount of withdrawal liability
pursuant to Section 4202 of ERISA and (iv) the Borrower obtaining knowledge or
reason to know that the Borrower or any ERISA Affiliate has filed or intends to
file a notice of intent to terminate any Pension Plan under a distress
termination within the meaning of Section 4041(c) of ERISA;
(f) any event which makes any of the representations set forth in
Section 5.1 inaccurate in any material respect; and
(g) any change by Xxxxx'x, S&P or Duff & Xxxxxx in the senior debt
credit rating of the Borrower.
Section 6.3. Accuracy of Information. All written information, reports,
statements and other papers and data furnished by or on behalf of the Borrower
to the Agent or any Lender (other than financial forecasts) whether pursuant to
this Article 6 or any other provision of this Agreement or any of the other Loan
Documents, shall be, at the time the same is so furnished, complete and correct
in all material respects.
ARTICLE 7
AFFIRMATIVE COVENANTS
Until all of the Obligations have been finally and indefeasibly paid
and satisfied in full and the Revolving Credit Commitments have been terminated,
unless consent has been obtained in the manner provided for in Section 12.11,
the Borrower will:
Section 7.1. Taxes. Pay and discharge, and cause each of its
Subsidiaries to pay and discharge, all taxes, assessments, and governmental
charges upon it, its income, and its properties prior to the date on which
penalties are attached thereto, unless and to the extent only that (a) such
taxes, assessments, and governmental charges are being contested by the Borrower
or such Subsidiary in good faith and by appropriate proceedings, and (b) the
non-payment of such taxes, assessments or charges would not have a material
adverse effect on the business, operations, property or financial condition of
the Borrower, any Material Subsidiary or the Borrower and its Subsidiaries taken
as a whole and would not materially and adversely affect the ability of the
Borrower to perform its obligations under this Agreement or any of the other
Loan Documents.
Section 7.2. Payment of Obligations. Pay and discharge, and cause each
of its Subsidiaries to pay and discharge, at or before their maturity all
indebtedness and other obligations and liabilities of the Borrower or such
Subsidiary, as the case may be, in excess of $10,000,000, except when the same
may be contested in good faith and by appropriate proceedings.
Section 7.3. Insurance. Maintain, and cause each of its Subsidiaries to
maintain, insurance with responsible companies selected by the Borrower and
satisfactory to the Agent in such amounts and against such risks as is
customarily carried by owners of similar businesses and property, and, on the
Closing Date and from time to time thereafter, deliver to the Agent upon its
request a detailed list of the insurance then in effect, stating the names of
the insurance companies, the amounts and rates of the insurance, the dates of
the expiration thereof and the properties and risks covered thereby.
Section 7.4. Corporate Existence. Except as otherwise permitted by
Section 9.3, maintain, and cause each of its Material Subsidiaries to maintain,
its corporate existence in good standing and to maintain all licenses, filings
and registrations material to the conduct of its business as now being
conducted.
Section 7.5. Properties. Maintain, preserve, and protect all material
franchises and trade names and preserve all the remainder of its material
property used or useful in the conduct of its business and keep the same in good
repair, working order, and condition, and from time to time make or cause to be
made all needful and proper repairs, renewals, replacements, betterments, and
improvements thereto so that the business carried on in connection therewith may
be properly and advantageously conducted at all times, and cause each of its
Subsidiaries so to maintain its material properties; provided that nothing
contained in this Section 7.5 shall prevent the Borrower or any Subsidiary from
discontinuing any franchise or trade name which is not material to its business
or the operation and maintenance of any of its non-material properties or from
failing to make any repairs, renewals, replacements, betterments or improvements
thereto if such discontinuance or failure is desirable, in the best judgment of
the Borrower, in the conduct of its business or the business of any Subsidiary.
Section 7.6. ERISA. In addition to and without limiting the generality
of Section 7.8, (a) comply in all material respects with all applicable
provisions of ERISA and the regulations and published interpretations thereunder
with respect to all Employee Benefit Plans, (b) not take any action or fail to
take any action the result of which could be a material liability to the PBGC or
to a Multiemployer Plan, (c) not participate in any prohibited transaction that
could result in any civil penalty under ERISA or tax under the Code, (d) operate
each Employee Benefit Plan in such a manner that will not incur any liability
under Section 4980B of the Code or any liability to any qualified beneficiary as
defined in Section 4980B of the Code, and (e) furnish to the Agent upon the
Agent's request such additional information concerning any Employee Benefit Plan
as may be reasonably requested by the Agent.
Section 7.7. Investment Guidelines. Cause each of its Insurance Company
Subsidiaries to comply in all material respects with all applicable regulatory
investment requirements and guidelines, and all internal investment requirements
and guidelines as they exist from time to time, and deliver to the Agent a copy
of the revised internal investment requirements and guidelines each time they
are modified in any material respect by an Insurance Company Subsidiary.
Section 7.8. Compliance with Laws. Comply, and cause each of its
Subsidiaries to comply, in all material respects with all Applicable Laws,
including, without limitation, all Environmental Laws, and maintain in full
force and effect all material Governmental Approvals, in each case applicable to
the conduct of its business.
Section 7.9. Accounting Methods and Financial Records. Maintain, and
cause each of its Subsidiaries to maintain, a system of accounting, and keep,
and cause each of its Subsidiaries to keep, such books, records and accounts
(which shall be true and complete in all material respects) as may be required
or as may be necessary to permit the preparation of financial statements in
accordance with GAAP or SAP, as applicable, and in compliance with the
regulations of any Governmental Authority having jurisdiction over it or any of
its properties.
Section 7.10. Visits and Inspections. Permit representatives of the
Agent or any Lender, from time to time, to visit and inspect its properties;
inspect, audit and make extracts from its books, records and files, including,
but not limited to, management matters prepared by independent accountants; and
discuss with its principal officers and its independent accountants its
business, assets, liabilities, financial condition, results of operations and
business prospects.
Section 7.11. Conduct of Business. Engage, and cause each of its
Subsidiaries to engage, in business in substantially the same fields as the
businesses conducted on the Closing Date and in lines of business reasonably
related thereto.
Section 7.12. Year 2000 Compatibility. Take all appropriate actions,
and cause each of its Subsidiaries to take all appropriate actions, necessary to
assure that the material computer based systems of the Borrower and its
Subsidiaries are able to operate and effectively process data which includes
dates on and after January 1, 2000, except where the failure to operate or
process such dates would not have a Material Adverse Effect. At the request of
the Agent, the Borrower shall provide reasonable assurances reasonably
satisfactory to the Agent concerning compliance with this Section 7.12.
Section 7.13. Further Assurances. Make, execute and deliver all such
additional and further documents and instruments, and take all such further
actions, as the Agent or any Lender may reasonably require to document and
consummate the transactions contemplated hereby and to vest completely in and
insure the Agent and the Lenders their respective rights under this Agreement,
the Revolving Credit Notes and the other Loan Documents.
ARTICLE 8
FINANCIAL COVENANTS
Until all of the Obligations have been finally and indefeasibly paid
and satisfied in full and the Revolving Credit Commitments have been terminated,
unless consent has been obtained in the manner provided for in Section 12.11:
Section 8.1. Combined Statutory Surplus. The Borrower will cause its
Insurance Company Subsidiaries to maintain a Combined Statutory Surplus which
(i) at any time from and including the Closing Date through and including
December 30, 1998, is not less than $250,518,000, and (ii) at any time
thereafter, is not less than the greater of (x) seventy-five percent (75%) of
the actual Combined Statutory Surplus as of the most recent December 31, or (y)
the Combined Statutory Surplus required to be maintained under this Section 8.1
during the twelve-month period immediately preceding the most recent December
31.
Section 8.2. Consolidated Debt to Consolidated Total Capital Ratio. The
Borrower will not permit the ratio of Consolidated Debt to Consolidated Total
Capital to exceed (i) .45 to 1 at any time from and including the Closing Date
through and including March 31, 2000, or (ii) .40 to 1 at any time thereafter.
ARTICLE 9
NEGATIVE COVENANTS
Until all of the Obligations have been finally and indefeasibly paid
and satisfied in full and the Revolving Credit Commitments have been terminated,
unless consent has been obtained in the manner provided for in Section 12.11,
the Borrower will not:
Section 9.1. Additional Borrowing. Create, incur, assume or suffer to
exist in any manner any additional Debt unless the payment of the Revolving
Credit Loans is senior to or ranks pari passu with the payment of such
additional Debt, or permit any of its Subsidiaries to create, incur, assume or
suffer to exist in any manner any additional Debt; provided that nothing
contained in this Section 9.1 shall prohibit (i) the Borrower from incurring any
additional Debt as long as the payment of the Revolving Credit Loans is senior
to or ranks pari passu with such additional Debt and as long as the creation,
incurrence, assumption or existence of such additional Debt would not otherwise
result in a violation of this Agreement, (ii) any Debt of any Subsidiary
existing as of the date of this Agreement which is described on Schedule 9.1,
(iii) any Debt of any Subsidiary owing to the Borrower or any other Subsidiary,
(iv) any Debt of any Subsidiary outstanding at the time such Subsidiary becomes
a Subsidiary of the Borrower and not incurred in contemplation thereof, as long
as the Debt remains the sole obligation of such Subsidiary and as long as the
outstanding amount of such Debt is not voluntarily increased by such Subsidiary
after the date such Subsidiary becomes a Subsidiary of the Borrower, (v) any
obligations of any Subsidiary incurred in the ordinary course of its business in
connection with letters of credit, appeal bonds or collateral agreements, in any
case related to reinsurance obligations, loss or claims payments under policies
of insurance or other regulatory requirements, (vi) any Debt of any Subsidiary
incurred in connection with any acquisition financing, provided that such Debt
shall not exceed the cost of the acquisition, (vii) any Debt of any Subsidiary
incurred in connection with any mortgage, refinancing or sale-leaseback of any
real estate currently owned by any Subsidiary, (viii) any Debt of the Borrower
or any Subsidiary secured by a Permitted Lien, provided that such Debt does not
exceed the value of the assets or property subject to such Permitted Lien, and
(ix) any Debt of any Subsidiary under any lease or purchase agreements hereafter
incurred, as long as the aggregate of such Debt incurred by the Borrower and its
Subsidiaries does not exceed $5,000,000 during any Fiscal Year.
Section 9.2 Negative Pledge. Create, incur, assume or suffer to exist
any Lien upon any of its assets or properties (including, without limitation,
the capital stock of any Insurance Company Subsidiary or any other Subsidiary
which is a Material Subsidiary, whether such capital stock is owned on the date
of this Agreement or hereafter acquired), or permit any of its Subsidiaries to
create, incur, assume or suffer to exist any Lien upon any of its assets or
properties (including, without limitation, the capital stock of any Insurance
Company Subsidiary or any other Subsidiary which is a Material Subsidiary,
whether such capital stock is owned on the date of this Agreement or hereafter
acquired), except for Permitted Liens. The restrictions contained in this
Section 9.2 shall not apply to Unrestricted Margin Stock.
Section 9.3. Merger, Acquisition, Sale of Assets and Liquidation. Enter
into any merger or consolidation with any Pledged Subsidiary or any other
Person, or sell, lease, assign, distribute or otherwise dispose of all or any
material portion of its assets or liquidate in whole or in part, or permit any
Material Subsidiary to enter into any merger or consolidation with any Pledged
Subsidiary or any other Person, or sell, lease, assign, distribute or dispose of
all or any material portion of its assets or liquidate in whole or in part;
except that (i) the Borrower may merge or consolidate with any Subsidiary (other
than a Pledged Subsidiary) or other Person incorporated under the laws of a
State of the United States, if the Borrower is the surviving corporation and
immediately after giving effect thereto no Default or Event of Default shall
have occurred and be continuing, and (ii) any Subsidiary (other than a Pledged
Subsidiary) may be merged or consolidated into, or may be liquidated into, or
may sell, lease or transfer assets to, the Borrower or a Wholly-Owned Subsidiary
(other than a Pledged Subsidiary), if, in the case of a merger or consolidation,
the Borrower or the Wholly-Owned Subsidiary is the surviving corporation and
immediately after giving effect thereto no Default or Event of Default shall
have occurred and be continuing. The restrictions contained in this Section 9.3
relating to the sale, lease, assignment, distribution and disposal of assets
shall not apply to Unrestricted Margin Stock.
Section 9.4. Intentionally Omitted.
Section 9.5. Certain Acquisitions. Acquire, or permit any of its
Subsidiaries to acquire, all or substantially all of the stock or the assets of
any Person which is not primarily engaged in property and casualty insurance or
property and casualty insurance-related businesses.
Section 9.6. Intentionally Omitted.
Section 9.7. Transactions with Pledged Subsidiaries and Affiliates.
Sell, lease, assign or otherwise transfer, or permit any Subsidiary to sell,
lease, assign or otherwise transfer, directly or indirectly, any property or
assets to a Pledged Subsidiary; make, or permit any Subsidiary to make, any loan
or other advance to a Pledged Subsidiary; or enter into or be a party to, or
permit any Subsidiary to enter into or be a party to, any other transaction with
a Pledged Subsidiary or any Affiliate, except pursuant to the reasonable
requirements of its business and upon fair and reasonable terms that are no less
favorable to it than it would obtain in a comparable arm's length transaction
with an unrelated Person; provided that nothing contained in this Section 9.7
shall prohibit the Borrower or any Subsidiary from entering into a transaction
with a Pledged Subsidiary involving the transfer of insurance and reinsurance
risks as long as the transaction results in a true transfer of risk.
Section 9.8. Sale and Leaseback. Enter into, or permit any Subsidiary
to enter into, directly or indirectly, any arrangement under which the Borrower
or such Subsidiary, as the case may be, sells or transfers any of the fixed
assets then owed by it and thereupon or within one year thereafter rents or
leases the assets so sold or transferred; provided that nothing contained in
this Section 9.8 shall prohibit (i) a Subsidiary from entering into a
sale-leaseback transaction involving any real estate currently owned by such
Subsidiary, or (ii) the Borrower or any Subsidiary from entering into any other
sale-leaseback transaction as long as such other sale-leaseback transaction,
together with all other such sale-leaseback transactions of the Borrower and its
Subsidiaries, does not involve assets having a value of more than $25,000,000 in
the aggregate.
Section 9.9. Use of Proceeds. None of the proceeds of the Revolving
Credit Loans will be used, directly or indirectly, in any manner which would
cause any Lender to violate Regulation U, and, without limiting the generality
of the foregoing, the Borrower will not permit more than 25% of the value of the
assets of the Borrower and its Subsidiaries, on a consolidated basis, that are
subject to the restrictions contained in Sections 9.2 and 9.3 to be attributable
to Margin Stock.
Section 9.10. Certain Accounting Changes. Change its Fiscal Year end or
make, or permit any of its Subsidiaries to make, any change in its accounting
treatment and reporting practices except as required by GAAP or SAP, as
applicable.
ARTICLE 10
DEFAULT AND REMEDIES
Section 10.1. Events of Default. Each of the following shall constitute
an Event of Default, whatever the reason for such event and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority or otherwise:
(a) Default shall be made by the Borrower in the payment of any
interest due on any one or more of the Revolving Credit Notes when such interest
is due and payable and such default shall continue unremedied for a period of
two (2) days; or
(b) Default shall be made by the Borrower in the payment of any
principal due on any one or more of the Revolving Credit Notes, when and as the
same becomes due and payable, whether at the stated maturity thereof, by
mandatory prepayment, by acceleration, demand or otherwise; or
(c) Default shall be made by the Borrower in the due observance or
performance of any term, covenant or agreement contained in Sections 2.7, 9.1,
9.2, 9.3 or 9.5 or contained in Article 8; or
(d) Default shall be made by the Borrower in the due observance or
performance of any other term, covenant, or agreement contained in this
Agreement, and such default shall continue unremedied for a period of thirty
(30) days after the sending of written notice of such default to the Borrower by
the Agent; or
(e) Any representation or warranty made by the Borrower herein or any
statement or representation made in any certificate, report, or opinion
delivered pursuant hereto shall prove to have been incorrect in any material
respect when made; or
(f) Any termination payment shall be due by the Borrower under any
Hedging Agreement and such amount shall not be paid within two (2) Business Days
of the due date thereof; or
(g) The Borrower or any of its Material Subsidiaries shall be generally
not paying its debts as such debts become due, shall become insolvent or unable
to meet its obligations as they mature, shall make an assignment for the benefit
of creditors, shall consent to the appointment of a trustee or a receiver, or
shall admit in writing its inability to pay its debts as they mature; or
(h) A trustee, receiver or custodian shall be appointed for the
Borrower, any Material Subsidiary or for a substantial part of any of their
properties; or
(i) Any case in bankruptcy shall be commenced, or any reorganization,
arrangement, insolvency, or liquidation proceedings shall be instituted, by or
against the Borrower or any Material Subsidiary and, if commenced or instituted
against it, be consented to by the Borrower or such Material Subsidiary, as the
case may be, or remain undismissed for a period of thirty (30) days; or
(j) Any final judgment for the payment of money in excess of
$10,000,000 which is not adequately insured or indemnified against shall be
rendered against the Borrower or any Material Subsidiary and the same shall
remain undischarged for a period of twenty (20) days during which time execution
shall not be effectively stayed; or
(k) Any default shall be made in the payment or performance of any
other obligation incurred in connection with any indebtedness for borrowed money
of the Borrower or any Material Subsidiary in excess of $20,000,000, if the
effect of such default is to permit the holder of such indebtedness (or a
trustee on behalf of such holder) to cause it to become due prior to its stated
maturity or any such indebtedness becomes due prior to its stated maturity or
shall not be paid when due; or
(l) (a) Any person or group of persons (within the meaning of Section
13(d) of the Securities Exchange Act of 1934, as amended) other than members of
the Xxxxxx family and trusts established by or for the benefit of members of the
Xxxxxx family, shall obtain ownership or control in one or more series of
transactions of more than twenty-five percent (25%) of the common stock and
twenty-five percent (25%) of the voting power of the Borrower entitled to vote
in the election of members of the board of directors of the Borrower, or there
shall have occurred under any indenture or other instrument evidencing any Debt
in excess of $20,000,000 any "change in control" (as defined in such indenture
or other evidence of Debt) obligating the Borrower to repurchase, redeem or
repay all or any part of the Debt or capital stock provided for therein; or
(m) Any substantial part of the properties of the Borrower or any
Material Subsidiary shall be sequestered or attached and shall not have been
returned to the possession of the Borrower or such Material Subsidiary, as the
case may be, or released from such attachment within thirty (30) days; or
(n) The occurrence of any of the following events: (i) the Borrower or
any ERISA Affiliate fails to make full payment when due of all amounts which,
under the provisions of any Pension Plan or Section 412 of the Code, the
Borrower or any ERISA Affiliate is required to pay as contributions thereto,
(ii) an accumulated funding deficiency in excess of $5,000,000 occurs or exists,
whether or not waived, with respect to any Pension Plan, (iii) a Termination
Event or (iv) the Borrower or any ERISA Affiliate as employers under one or more
Multiemployer Plan makes a complete or partial withdrawal from any such
Multiemployer Plan and the plan sponsor of such Multiemployer Plans notifies
such withdrawing employer that such employer has incurred a withdrawal liability
requiring payments in an amount exceeding $5,000,000; or
(o) Any provision of this Agreement or any other Loan Document shall
for any reason cease to be valid and binding on the Borrower or the Borrower
shall so state in writing.
Section 10.2. Remedies. Upon the occurrence of an Event of Default,
with the consent of the Required Lenders, the Agent may, or upon the request of
the Required Lenders, the Agent shall, by notice to the Borrower:
(a) Acceleration; Termination of Facilities. Declare the principal of
and interest on the Revolving Credit Loans and the Revolving Credit Notes at the
time outstanding, and all other amounts owed to the Lenders and to the Agent
under this Agreement or any of the other Loan Documents and all other
Obligations, to be forthwith due and payable, whereupon the same shall
immediately become due and payable without presentment, demand, protest or other
notice of any kind, all of which are expressly waived, anything in this
Agreement or the other Loan Documents to the contrary notwithstanding, and
terminate the Revolving Credit Commitments and any right of the Borrower to
request or receive any Revolving Credit Loans thereunder; provided that upon the
occurrence of an Event of Default specified in Section 10.1(i), the Revolving
Credit Commitments and the Borrower's right to receive Revolving Credit Loans
thereunder shall be automatically terminated and all Obligations shall
automatically become due and payable.
(b) Rights of Collection. Exercise on behalf of the Lenders all of its
and their other rights and remedies under this Agreement, the other Loan
Documents and Applicable Law, in order to satisfy all of the Obligations.
Section 10.3. Rights and Remedies Cumulative: Non-Waiver; Etc. The
enumeration of the rights and remedies of the Agent and the Lenders set forth in
this Agreement is not intended to be exhaustive and the exercise by the Agent
and the Lenders of any right or remedy shall not preclude the exercise of any
other rights or remedies, all of which shall be cumulative, and shall be in
addition to any other right or remedy given hereunder or under the Loan
Documents or that may now or hereafter exist in law or in equity or by suit or
otherwise. No delay or failure to take action on the part of the Agent or any
Lender in exercising any right, power or privilege shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
privilege preclude other or further exercise thereof or the exercise of any
other right, power or privilege or shall be construed to be a waiver of any
Default or Event of Default. No course of dealing between the Borrower, the
Agent and the Lenders or their respective agents or employees shall be effective
to change, modify or discharge any provision of this Agreement or any of the
other Loan Documents or to constitute a waiver of any Default or Event of
Default.
ARTICLE 11
THE AGENT
Section 11.1. Appointment. Each of the Lenders hereby irrevocably
designates and appoints First Union as Agent of such Lender under this Agreement
and the other Loan Documents, and each such Lender irrevocably authorizes First
Union as Agent for such Lender to take such action on its behalf under the
provisions of this Agreement and the other Loan Documents and to exercise such
powers and perform such duties as are expressly delegated to the Agent by the
terms of this Agreement and such other Loan Documents, together with such other
powers as are reasonably incidental thereto. Notwithstanding any provision to
the contrary elsewhere in this Agreement or such other Loan Documents, the Agent
shall have no duties or responsibilities, except those expressly set forth
herein and therein, or any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or the other Loan Documents or
otherwise exist against the Agent.
Section 11.2. Delegation of Duties. The Agent may execute any of its
duties under this Agreement and the other Loan Documents by or through agents or
attorneys-in-fact and shall be entitled to rely on advice of counsel concerning
all matters pertaining to such duties. The Agent shall not be responsible for
the negligence or misconduct of any agents or attorneys-in-fact selected by the
Agent with reasonable care.
Section 11.3. Exculpatory Provisions. Neither the Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or
Affiliates shall be (a) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or the
other Loan Documents (except for actions occasioned solely by its or such
Person's own gross negligence or willful misconduct), or (b) responsible in any
manner to any of the Lenders for any recitals, statements, representations or
warranties made by the Borrower or any of its Subsidiaries or any officer
thereof contained in this Agreement or the other Loan Documents or in any
certificate, report, statement or other document referred to or provided for in,
or received by the Agent under or in connection with, this Agreement or the
other Loan Documents or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or the other Loan Documents or
for any failure of the Borrower or any of its Subsidiaries to perform its
obligations hereunder or thereunder. The Agent shall not be under any obligation
to any Lender to ascertain or to inquire as to the observance or performance of
any of the agreements contained in, or conditions of, this Agreement, or to
inspect the properties, books or records of the Borrower or any of its
Subsidiaries.
Section 11.4. Reliance by the Agent. The Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or other
document or conversation believed by it to be genuine and correct and to have
been signed, sent or made by the proper Person or Persons and upon advice and
statements of legal counsel (including, without limitation, counsel to the
Borrower), independent accountants and other experts selected by the Agent. The
Agent may deem and treat the payee of any Revolving Credit Note as the owner
thereof for all purposes unless such Revolving Credit Note shall have been
transferred in accordance with Section 12.10. The Agent shall be fully justified
in failing or refusing to take any action under this Agreement and the other
Loan Documents unless it shall first receive such advice or concurrence of the
Required Lenders (or, when expressly required hereby or by the relevant other
Loan Document, all the Lenders) as it deems appropriate and it shall first be
indemnified to its satisfaction by the Lenders against any and all liability and
expense which may be incurred by it by reason of taking or continuing to take
any such action except for its own gross negligence or willful misconduct. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement and the Revolving Credit Notes in accordance with a
request of the Required Lenders (or, when expressly required hereby, all the
Lenders), and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders and all future holders of the
Revolving Credit Notes.
Section 11.5. Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of Default
hereunder unless it has received notice from a Lender or the Borrower referring
to this Agreement, describing such Default or Event of Default and stating that
such notice is a "notice of default." In the event that the Agent receives such
a notice, it shall promptly give notice thereof to the Lenders. The Agent shall
take such action with respect to such Default or Event of Default as shall be
reasonably directed by the Required Lenders; provided that unless and until the
Agent shall have received such directions, the Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
Section 11.6. Non-Reliance on the Agent and Other Lenders. Each Lender
expressly acknowledges that neither the Agent nor any of its respective
officers, directors, employees, agents, attorneys-in-fact, Subsidiaries or
Affiliates has made any representations or warranties to it and that no act by
the Agent hereafter taken, including any review of the affairs of the Borrower
or any of its Subsidiaries, shall be deemed to constitute any representation or
warranty by the Agent to any Lender. Each Lender represents to the Agent that it
has, independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it has deemed appropriate, made its
own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Borrower and its
Subsidiaries and made its own decision to make its Revolving Credit Loans
hereunder and enter into this Agreement. Each Lender also represents that it
will, independently and without reliance upon the Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Borrower and its Subsidiaries. Each Lender represents
that it has not relied on any Margin Stock in its credit analysis or its
decision to enter into this Agreement. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the Agent
hereunder or by the other Loan Documents, the Agent shall not have any duty or
responsibility to provide any Lender with any credit or other information
concerning the business, operations, property, financial and other condition or
creditworthiness of the Borrower or any of its Subsidiaries which may come into
the possession of the Agent or any of its officers, directors, employees,
agents, attorneys-in-fact, Subsidiaries or Affiliates.
Section 11.7. Indemnification. The Lenders agree to indemnify the Agent
in its capacity as Agent hereunder (to the extent not reimbursed by the Borrower
and without limiting the obligation of the Borrower to do so), ratably according
to the respective amounts of their respective Revolving Credit Commitment
Percentages, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses and disbursements
of any kind whatsoever which may at any time (including, without limitation, at
any time following the payment of the Revolving Credit Notes) be imposed on,
incurred by or asserted against the Agent in any way relating to or arising out
of this Agreement or the other Loan Documents, or any documents contemplated by
or referred to herein or therein or the transactions contemplated hereby or
thereby or any action taken or omitted by the Agent under or in connection with
any of the foregoing; provided that no Lender shall be liable for the payment of
any portion of such liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements resulting directly
from the Agent's bad faith, gross negligence or willful misconduct. The
agreements in this Section 11.7 shall survive the payment of the Revolving
Credit Notes and all other amounts payable hereunder and the termination of this
Agreement.
Section 11.8. The Agent in Its Individual Capacity. The Agent and its
respective Subsidiaries and Affiliates may make loans to, accept deposits from
and generally engage in any kind of business with the Borrower as though the
Agent were not the Agent hereunder. With respect to any Revolving Credit Loans
made or renewed by it and any Revolving Credit Note issued to it, the Agent
shall have the same rights and powers under this Agreement and the other Loan
Documents as any Lender and may exercise the same as though it were not the
Agent, and the terms "Lender" and "Lenders" shall include the Agent in its
individual capacity.
Section 11.9. Resignation of the Agent: Successor Agent. Subject to the
appointment and acceptance of a successor as provided below, the Agent may
resign at any time by giving notice thereof to the Lenders and the Borrower.
Upon any such resignation, the Required Lenders shall have the right, subject to
the consent of the Borrower which shall not be unreasonably withheld, to appoint
a successor Agent, which successor shall have minimum capital and surplus of at
least $500,000,000. If no successor Agent shall have been so appointed by the
Required Lenders and shall have accepted such appointment within thirty (30)
days after the Agent's giving of notice of resignation, then the Agent may, on
behalf of the Lenders, appoint a successor Agent, which successor shall have
minimum capital and surplus of at least $500,000,000. Upon the acceptance of any
appointment as Agent hereunder by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all 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
hereunder as Agent, the provisions of this Section 11 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.
ARTICLE 12
MISCELLANEOUS
Section 12.1. Notices.
(a) Method of Communication. Except as otherwise provided in this
Agreement, all notices and communications hereunder shall be in writing or by
telephone subsequently confirmed in writing. Any notice shall be effective if
delivered by hand delivery or sent via telefacsimile, recognized overnight
courier service or certified mail, return receipt requested, and shall be
presumed to be received by a party hereto (i) on the date of delivery if
delivered by hand or sent by telefacsimile, (ii) on the next Business Day if
sent by recognized overnight courier service and (iii) on the third Business Day
following the date sent by certified mail, return receipt requested. A
telephonic notice to the Agent as understood by the Agent will be deemed to be
the controlling and proper notice in the event of a discrepancy with or failure
to receive a confirming written notice.
(b) Addresses for Notices. Except as provided below, all notices to any
party shall be sent to it at the following addresses, or any other address as to
which all the other parties are notified in writing:
If to the Borrower: Xxxxxx Corporation
0000 Xxx Xxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
With copies to: Xxxxxx Corporation
0000 Xxx Xxxx
Xxxx Xxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
If to First Union as Agent: First Union National Bank
One First Union Center
000 Xxxxx Xxxxxxx Xxxxxx XX-0
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxxxx
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
With copies to: Xxxxxxx X. Xxxx
Xxxx & Valentine, L.L.P.
0000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
If to any Lender: To the address set forth for such
Lender on the signature pages hereto
Each Notice of Borrowing, Notice of Conversion/Continuation and other notice
from the Borrower with respect to borrowings hereunder shall be sent by the
Borrower to the following address, or such other address as to which the
Borrower is notified in writing:
First Union National Bank
Xxx Xxxxx Xxxxx Xxxxxx, XX-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: Syndication Agency Services
Telephone No.: (000) 000-0000
Telefacsimile No.: (000) 000-0000
(c) Agent's Office. The Agent hereby designates its office located at
the address set forth immediately above, or any subsequent office which shall
have been specified for such purpose by written notice to the Borrower and
Lenders, as the Agent's Office referred to herein, to which payments due are to
be made and at which the Revolving Credit Loans will be disbursed.
Section 12.2. Expenses; Indemnity. The Borrower will (a) pay all
reasonable out-of-pocket expenses of the Agent in connection with: (i) the
preparation, execution and delivery of this Agreement and each other Loan
Document, whenever the same shall be executed and delivered, including without
limitation all out-of-pocket syndication and due diligence expenses and
reasonable fees and disbursements of counsel for the Agent (provided, however,
that the Agent agrees that the obligation of the Borrower to pay such out of
pocket syndication and due diligence expenses and reasonable fees and
disbursements of counsel for the Agent in connection with the preparation,
execution and delivery of this Agreement and the other Loan Documents is subject
to the terms of the commitment letter dated March 13, 1998, from the Agent and
Capital Markets to the Borrower), (ii) the preparation, execution and delivery
of any waiver, amendment or consent by the Agent or the Lenders relating to this
Agreement or any other Loan Document, including without limitation reasonable
fees and disbursements of counsel for the Agent and (iii) the administration and
enforcement of any rights and remedies of the Agent and the Lenders under the
Revolving Credit Facility, including consulting with appraisers, accountants,
engineers, attorneys and other Persons concerning the nature, scope or value of
any right or remedy of the Agent or any Lender hereunder or under any other Loan
Document or any factual matters in connection therewith, which expenses shall
include without limitation the reasonable fees and disbursements of such
Persons, and (b) defend, indemnify and hold harmless the Agent and the Lenders,
and their respective parents, Subsidiaries, Affiliates, employees, agents,
officers and directors, from and against any losses, penalties, fines,
liabilities, settlements, damages, costs and expenses, suffered by any such
Person in connection with any claim, investigation, litigation or other
proceeding (whether or not the Agent or any Lender is a party thereto) and the
prosecution and defense thereof, arising out of or in any way connected with
this Agreement, any other Loan Document or the Revolving Credit Loans, including
without limitation reasonable attorneys' and consultants' fees, except to the
extent that any of the foregoing directly result from the gross negligence or
willful misconduct of the party seeking indemnification therefor.
Section 12.3. Setoff. In addition to any rights now or hereafter
granted under Applicable Law and not by way of limitation of any such rights,
upon and after the occurrence of any Event of Default and during the continuance
thereof, the Lenders and any assignee or participant of a Lender in accordance
with Section 12.10 are hereby authorized by the Borrower at any time or from
time to time, without notice to the Borrower or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to apply
any and all deposits (general or special, time or demand, including, but not
limited to, indebtedness evidenced by certificates of deposit, whether matured
or unmatured) and any other indebtedness at any time held or owing by the
Lenders, or any such assignee or participant to or for the credit or the account
of the Borrower against and on account of the Obligations irrespective of
whether or not (a) the Lenders shall have made any demand under this Agreement
or any of the other Loan Documents or (b) the Agent shall have declared any or
all of the Obligations to be due and payable as permitted by Section 10.2 and
although such Obligations shall be contingent or unmatured.
Section 12.4. Governing Law. This Agreement and the other Loan
Documents have been entered into and consummated in the Commonwealth of
Virginia, and this Agreement and the rights and obligations of the parties
hereunder shall be construed and interpreted in accordance with the laws of the
Commonwealth of Virginia without regard to principles of conflict of laws.
Section 12.5. Consent to Jurisdiction. The Borrower irrevocably
consents that any legal action or proceeding against it under, arising out of or
in any manner relating to, this Agreement, the Revolving Credit Notes, or any of
the other Loan Documents, may be brought in any court of the Commonwealth of
Virginia located within the Eastern District of Virginia or in the United States
District Court for the Eastern District of Virginia. The Borrower, by the
execution and delivery of this Agreement, expressly and irrevocably consents and
submits to the personal jurisdiction of any of such courts in any such action or
proceeding. The Borrower further irrevocably consents to the service of any
complaint, summons, notice or other process relating to any such action or
proceeding by delivery thereof to it or to its registered agent by hand or by
mail in the manner provided for in Section 12.1. The Borrower hereby expressly
and irrevocably waives any claim or defense in any such action or proceeding
based on any alleged lack of personal jurisdiction, improper venue or forum non
conveniens or any similar basis. Nothing in this Section 12.5 shall affect or
impair in any manner or to any extent the right of the Agent or any Lender to
commence legal proceedings or otherwise proceed against any Borrower in any
jurisdiction or to serve process in any manner permitted by law.
Section 12.6. Waiver of Jury Trial. THE BORROWER, THE AGENT AND EACH
LENDER HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION (1) ARISING UNDER THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR
(2) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM IN RESPECT OF THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT OR TORT OR
OTHERWISE. THE BORROWER, THE AGENT AND EACH LENDER AGREES AND CONSENTS THAT ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY AND THAT ANY OF THEM MAY FILE AN ORIGINAL COUNTERPART OR A COPY
OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
Section 12.7. Reversal of Payments. To the extent the Borrower makes a
payment or payments to the Agent for the ratable benefit of the Lenders or the
Agent receives any payment or proceeds of the collateral which payments or
proceeds or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any bankruptcy law, state or federal law,
common law or equitable cause, then, to the extent of such payment or proceeds
repaid, the Obligations or part thereof intended to be satisfied shall be
revived and continued in full force and effect as if such payment or proceeds
had not been received by the Agent.
Section 12.8. Injunctive Relief. The Borrower recognizes that, in the
event the Borrower fails to perform, observe or discharge any of its obligations
or liabilities under this Agreement, any remedy at law may prove to be
inadequate relief to the Lenders. Therefore, the Borrower agrees that the
Lenders, at the Lenders' option, shall be entitled to temporary and permanent
injunctive relief in any such case without the necessity of proving actual
damages.
Section 12.9. Accounting Matters. All financial and accounting
calculations, measurements and computations made for any purpose relating to
this Agreement, including, without limitation, all computations utilized by the
Borrower or any Subsidiary thereof to determine compliance with any covenant
contained herein, shall, except as otherwise expressly contemplated hereby or
unless there is an express written direction by the Agent to the contrary agreed
to by the Borrower, be performed in accordance with GAAP as in effect on the
Closing Date. In the event that changes in GAAP shall be mandated by the
Financial Accounting Standards Board, or any similar accounting body of
comparable standing, or shall be recommended by the Borrower's certified public
accountants, to the extent that such changes would modify such accounting terms
or the interpretation or computation thereof, such changes shall be followed in
defining such accounting terms only from and after the date the Borrower and the
Lenders shall have amended this Agreement to the extent necessary to reflect any
such changes in the financial covenants and other terms and conditions of this
Agreement.
Section 12.10. Successors and Assigns; Participations.
(a) Benefit of Agreement. This Agreement shall be binding upon and
inure to the benefit of the Borrower, the Agent and the Lenders, all future
holders of the Revolving Credit Notes, and their respective successors and
assigns, except that the Borrower shall not assign or transfer any of its rights
or obligations under this Agreement without the prior written consent of each
Lender.
(b) Assignment by Lenders. Each Lender may, with the consent of the
Agent and, as long as no Default or Event of Default has occurred and is
continuing, the consent of the Borrower, which consents shall not be
unreasonably withheld, assign to one or more Eligible Assignees all or a portion
of its interests, rights and obligations under this Agreement (including,
without limitation, all or a portion of the Revolving Credit Loans at the time
owing to it and the Revolving Credit Notes held by it); provided that:
(i) each such assignment shall be of a constant, and not a
varying, percentage of all the assigning Lender's rights and obligations under
this Agreement;
(ii) if less than all of the assigning Lender's Revolving
Credit Commitment is to be assigned, the amount so assigned shall not be less
than $5,000,000;
(iii) the parties to each such assignment shall execute and
deliver to the Agent, for its acceptance and recording in the Register, an
Assignment and Acceptance in the form of Exhibit E hereto (an "Assignment and
Acceptance"), together with any Revolving Credit Note or Revolving Credit Notes
subject to such assignment;
(iv) such assignment shall not, without the consent of the
Borrower, require the Borrower to file a registration statement with the SEC or
apply to or qualify the Revolving Credit Loans or the Revolving Credit Notes
under the blue sky laws of any state; and
(v) the assigning Lender shall pay to the Agent an assignment
fee of $3,000 upon the execution by such Lender of the Assignment and
Acceptance; provided that no such fee shall be payable upon any assignment by a
Lender to an Affiliate thereof.
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, (A) the
assignee thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a Lender hereunder
and (B) the Lender thereunder shall, to the extent provided in such assignment,
be released from its obligations under this Agreement.
(c) Rights and Duties Upon Assignment. By executing and delivering an
Assignment and Acceptance, the assigning Lender thereunder and the assignee
thereunder confirm to and agree with each other and the other parties hereto as
set forth in such Assignment and Acceptance.
(d) Register. The Agent shall maintain a copy of each Assignment and
Acceptance delivered to it and a register for the recordation of the names and
addresses of the Lenders and the amount of the Revolving Credit Loans with
respect to each Lender from time to time (the "Register"). The entries in the
Register shall be conclusive, in the absence of manifest error, and the
Borrower, the Agent and the Lenders may treat each person whose name is recorded
in the Register as a Lender hereunder for all purposes of this Agreement. The
Register shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice.
(e) Issuance of New Notes. Upon its receipt of an Assignment and
Acceptance executed by an assigning Lender and an Eligible Assignee together
with any Revolving Credit Note or Revolving Credit Notes subject to such
assignment and the written consent to such assignment, the Agent shall, if such
Assignment and Acceptance has been completed and is substantially in the form of
Exhibit E:
(i) accept such Assignment and Acceptance;
(ii) record the information contained therein in the Register;
(iii) give prompt notice thereof to the Lenders and the
Borrower; and
(iv) promptly deliver a copy of such Assignment and Acceptance
to the Borrower.
Within five (5) Business Days after receipt of notice, the Borrower shall
execute and deliver to the Agent, in exchange for the surrendered Revolving
Credit Note or Revolving Credit Notes, a new Revolving Credit Note or Revolving
Credit Notes to the order of such Eligible Assignee in amounts equal to the
Revolving Credit Loans assumed by it pursuant to such Assignment and Acceptance
and a new Revolving Credit Note or Revolving Credit Notes to the order of the
assigning Lender in an amount equal to the Revolving Credit Loans retained by it
hereunder. Such new Revolving Credit Note or Revolving Credit Notes shall be in
an aggregate principal amount equal to the aggregate principal amount of such
surrendered Revolving Credit Note or Revolving Credit Notes, shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be in
substantially the form of the assigned Revolving Credit Notes originally
delivered to the assigning Lender. Each surrendered Revolving Credit Note or
Revolving Credit Notes shall be canceled and returned to the Borrower.
(f) Participations. Each Lender may sell participations to one or more
banks or other entities in all or a portion of its rights and obligations under
this Agreement (including, without limitation, all or a portion of its Revolving
Credit Loans and the Revolving Credit Notes held by it); provided that:
(i) each such participation shall be in an amount not less
than $5,000,000;
(ii) such Lender's obligations under this Agreement shall
remain unchanged;
(iii) such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations;
(iv) such Lender shall remain the holder of the Revolving
Credit Notes held by it for all purposes of this Agreement;
(v) the Borrower, the Agent and the other Lenders shall
continue to deal solely and directly with such Lender in connection with such
Lender's rights and obligations under this Agreement;
(vi) such Lender shall not permit such participant the right
to approve any waivers, amendments or other modifications to this Agreement or
any other Loan Document other than waivers, amendments or modifications which
would reduce the principal of or the interest rate on any Revolving Credit Loan,
extend the term or increase the amount of the Revolving Credit Loans, reduce the
amount of any fees to which such participant is entitled, extend any scheduled
payment date for principal of any Revolving Credit Loan or, except as expressly
contemplated hereby or thereby, release any collateral securing the Obligations;
and
(vii) any such disposition shall not, without the consent of
the Borrower, require the Borrower to file a registration statement with the SEC
or apply to or qualify the Revolving Credit Loans or the Revolving Credit Notes
under the blue sky laws of any state.
(g) Disclosure of Information: Confidentiality. The Agent and the
Lenders shall hold all non-public information with respect to the Borrower
obtained pursuant to the Loan Documents in accordance with their customary
procedures for handling confidential information. Any Lender may, in connection
with any assignment, proposed assignment, participation or proposed
participation pursuant to this Section 12.10, disclose to the assignee,
participant, proposed assignee or proposed participant, any information relating
to the Borrower furnished to such Lender by or on behalf of the Borrower;
provided that prior to any such disclosure, each such assignee, proposed
assignee, participant or proposed participant shall agree with the Borrower or
such Lender to preserve the confidentiality of any confidential information
relating to the Borrower received from such Lender.
(h) Certain Pledges or Assignments. Nothing herein shall prohibit any
Lender from pledging or assigning any Revolving Credit Note to any Federal
Reserve Bank in accordance with Applicable Law or to any of its Affiliates.
Section 12.11. Amendments, Waivers and Consents. Except as set forth
below, any term, covenant, agreement or condition of this Agreement or any of
the other Loan Documents may be amended or waived by the Lenders, and any
consent given by the Lenders, if, but only if, such amendment, waiver or consent
is in writing signed by the Required Lenders (or by the Agent with the consent
of the Required Lenders) and delivered to the Agent and, in the case of an
amendment, signed by the Borrower; provided that no amendment, waiver or consent
shall (a) increase the amount or extend the time of the obligation of the
Lenders to make Revolving Credit Loans (including without limitation pursuant to
Section 2.6), (b) extend the originally scheduled time or times of payment of
the principal of any Revolving Credit Loan or the time or times of payment of
interest on any Revolving Credit Loan, (c) reduce the rate of interest or fees
payable on any Revolving Credit Loan, (d) permit any subordination of the
principal or interest on any Revolving Credit Loan, (e) release any collateral
or security document (other than as specifically permitted in this Agreement or
the applicable security document) or (f) amend the provisions of this Section
12.11 or the definition of Required Lenders, without the prior written consent
of each Lender. In addition, no amendment, waiver or consent to the provisions
of Article 11 shall be made without the written consent of the Agent.
Section 12.12. Performance of Duties. The Borrower's obligations under
this Agreement and each of the other Loan Documents shall be performed by the
Borrower at its sole cost and expense.
Section 12.13. All Powers Coupled with Interest. All powers-of-attorney
and other authorizations granted to the Lenders, the Agent and any Persons
designated by the Agent or any Lender pursuant to any provisions of this
Agreement or any of the other Loan Documents shall be deemed coupled with an
interest and shall be irrevocable as long as any of the Obligations remain
unpaid or unsatisfied or the Revolving Credit Facility has not been terminated.
Section 12.14. Survival of Indemnities. Notwithstanding any termination
of this Agreement, the indemnities to which the Agent and the Lenders are
entitled under the provisions of this Article 12 and any other provision of this
Agreement and the Loan Documents shall continue in full force and effect and
shall protect the Agent and the Lenders against events arising after such
termination as well as before.
Section 12.15. Titles and Captions. Titles and captions of Articles,
sections and subsections in this Agreement are for convenience only, and neither
limit nor amplify the provisions of this Agreement.
Section 12.16. Severability of Provisions. Any provision of this
Agreement or any other Loan Document which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions hereof or thereof or affecting the
validity or enforceability of such provision in any other jurisdiction.
Section 12.17. Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns, and all of which taken
together shall constitute one and the same agreement.
Section 12.18. Term of Agreement. This Agreement shall remain in effect
from the Closing Date through and including the date upon which all Obligations
shall have been indefeasibly and irrevocably paid and satisfied in full. No
termination of this Agreement shall affect the rights and obligations of the
parties hereto arising prior to such termination.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their duly authorized officers, all as of the day and year first written
above.
XXXXXX CORPORATION
By:
Name:
Title:
FIRST UNION NATIONAL BANK, as Agent
By:
Name:
Title:
[Remainder of this page intentionally left blank]
FIRST UNION NATIONAL BANK, as Lender
Address: By:
One First Union Center Name:
000 X. Xxxxxxx Xxxxxx, XX0 Title:
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxxxx Revolving Credit Commitment - $45,000,000
Telephone No.: (000) 000-0000 Revolving Credit Commitment Percentage - 18%
Telefacsimile No.: (000) 000-0000
[Remainder of this page intentionally left blank]
CRESTAR BANK, as Lender
Address: By:
000 Xxxx Xxxx Xxxxxx Name:
Xxxxxxxx, Xxxxxxxx 00000 Title:
Attention: Xxxxxxx X. Xxxxxxxx
Telephone No.: (000) 000-0000 Revolving Credit Commitment - $30,000,000
Telefacsimile No.: (000) 000-0000 Revolving Credit Commitment Percentage - 12%
[Remainder of this page intentionally left blank]
UNION BANK OF CALIFORNIA, N.A.,
as Lender
Address: By:
000 X. Xxxx Xxxxxx Name:
3rd Floor Title:
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxxxxx Revolving Credit Commitment - $30,000,000
Telephone No.: (000) 000-0000 Revolving Credit Commitment Percentage - 12%
Telefacsimile No.: (000) 000-0000
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THE NORTHERN TRUST COMPANY,
as Lender
Address: By:
00 X. XxXxxxx Xxxxxx Name:
Xxxxxxx, Xxxxxxxx 00000 Title:
Attention: Xxxxxxx X. Xxxxxx
Telephone No.: (000) 000-0000 Revolving Credit Commitment - $30,000,000
Telefacsimile No.: (000) 000-0000 Revolving Credit Commitment Percentage - 12%
[Remainder of this page intentionally left blank]
FLEET NATIONAL BANK,
as Lender
Address: By:
000 Xxxx Xxxxxx Name:
Xxxxxxxx, Xxxxxxxxxxx 00000 Title:
Attention: Xxxx Xxxxxxx
Telephone No.: (000) 000-0000 Revolving Credit Commitment - $40,000,000
Telefacsimile No.: (000) 000-0000 Revolving Credit Commitment Percentage - 16%
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DRESDNER BANK AG, NEW YORK
BRANCH AND GRAND CAYMAN BRANCH,
as Lender
Address: By:
00 Xxxx Xxxxxx Name:
Xxx Xxxx, Xxx Xxxx 00000 Title:
Attention: Xxxxx Xxxxxxx
Telephone No.: (000) 000-0000 By:
Telefacsimile No.: (000) 000-0000 Name:
Title:
Revolving Credit Commitment - $25,000,000
Revolving Credit Commitment Percentage - 10%
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MELLON BANK, N.A.,
as Lender
Address: By:
Xxx Xxxxxx Xxxx Xxxxxx, Xxxxx 000 Name:
Xxxxxxxxxx, Xxxxxxxxxxxx 00000 Title:
Attention: Xxxxx X. Xxxxxxxxx
Telephone No.: (000) 000-0000 Revolving Credit Commitment - $25,000,000
Telefacsimile No.: (000) 000-0000 Revolving Credit Commitment Percentage - 10%
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SUNTRUST BANK, ATLANTA,
as Lender
Address: By:
00 Xxxx Xxxxx, X.X., 00xx Xxxxx Name:
Xxxxxxx, Xxxxxxx 00000 Title:
Attention: Xxxxxxx Xxxx
Telephone No.: (000) 000-0000 By:
Telefacsimile No.: (000) 000-0000 Name:
Title:
Revolving Credit Commitment - $25,000,000
Revolving Credit Commitment Percentage - 10%
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