1
Exhibit 10.10
CREDIT AGREEMENT
DATED AS OF OCTOBER 6, 1995
AMONG
FIBERITE, INC.,
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
AS AGENT,
AND
THE OTHER FINANCIAL INSTITUTIONS PARTY HERETO
ARRANGED BY
BA SECURITIES, INC.
2
TABLE OF CONTENTS
Section Page
ARTICLE I
DEFINITIONS.................................................. 1
1.1 Certain Defined Terms................................................................................... 1
1.2 Other Interpretive Provisions........................................................................... 28
1.3 Accounting Principles................................................................................... 29
ARTICLE II
THE CREDITS.................................................. 29
2.1 Amounts and Terms of Commitments........................................................................ 29
(a) The Term A Credit............................................................................. 29
(b) The Term B Credit............................................................................. 30
(c) The Revolving Credit.......................................................................... 30
2.2 Loan Accounts........................................................................................... 30
2.3 Procedure for Borrowing................................................................................. 31
2.4 Conversion and Continuation Elections................................................................... 31
2.5 Voluntary Termination or Reduction of Revolving
Commitments....................................................................................... 33
2.6 Optional Prepayments.................................................................................... 33
2.7 Mandatory Prepayments of Loans.......................................................................... 34
2.8 Repayment............................................................................................... 35
(a) The Term A Credit............................................................................. 35
(b) The Term B Credit............................................................................. 35
(c) The Revolving Credit.......................................................................... 36
2.9 Interest............................................................................................... 36
2.10 Fees .................................................................................................. 36
(a) Arranger and Agency Fees..................................................................... 36
(b) Commitment Fees.............................................................................. 37
2.11 Computation of Fees and Interest....................................................................... 37
2.12 Payments by the Company................................................................................ 37
2.13 Payments by the Lenders to the Agent................................................................... 38
2.14 Sharing of Payments, Etc............................................................................... 39
ARTICLE III
THE LETTERS OF CREDIT............................................. 39
3.1 The Letter of Credit Subfacility........................................................................ 39
3.2 Issuance, Amendment and Renewal of Letters of Credit.................................................... 41
3.3 Risk Participations, Drawings and Reimbursements........................................................ 43
3.4 Repayment of Participations............................................................................. 45
3.5 Role of the Issuing Lenders............................................................................. 45
3.6 Obligations Absolute.................................................................................... 46
3.7 Cash Collateral Pledge.................................................................................. 47
3.8 Letter of Credit Fees................................................................................... 47
3.9 Uniform Customs and Practice............................................................................ 48
-i-
3
Section Page
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY..................................... 48
4.1 Taxes................................................................................................... 48
4.2 Illegality.............................................................................................. 50
4.3 Increased Costs and Reduction of Return................................................................. 50
4.4 Funding Losses.......................................................................................... 51
4.5 Inability to Determine Rates............................................................................ 52
4.6 Certificates of Lenders................................................................................. 52
4.7 Substitution of Lenders................................................................................. 52
4.8 Survival................................................................................................ 53
ARTICLE V
CONDITIONS PRECEDENT.............................................. 53
5.1 Documentary Conditions of Initial Credit Extensions..................................................... 53
(a) Credit Agreement and Notes................................................................ 53
(b) Resolutions and Incumbency of Company .................................................... 53
(c) Resolutions and Incumbency of Parent...................................................... 53
(d) Organization Documents; Good Standing..................................................... 54
(e) Legal Opinions............................................................................ 54
(f) Solvency Opinion.......................................................................... 54
(g) Payment of Fees........................................................................... 54
(h) Certificate............................................................................... 54
(i) Security Agreement, etc................................................................... 55
(j) Guaranty.................................................................................. 55
(k) Pledge Agreements......................................................................... 55
(l) Real Property............................................................................. 55
(m) Landlord's Consents ...................................................................... 56
(n) Purchase Agreement Assignment............................................................. 56
(o) Purchase Agreements, and Other Documents.................................................. 56
(p) Other Documents........................................................................... 56
5.2 Other Conditions to Initial Loan or Letter of Credit.................................................... 56
(a) Capitalization of the Company............................................................. 56
(b) Capitalization of the Parent.............................................................. 57
(c) Subordinated Notes........................................................................ 57
(d) Purchase.................................................................................. 57
5.3 Conditions to All Credit Extensions..................................................................... 57
(a) Notice, Application....................................................................... 57
(b) Continuation of Representations and Warranties............................................ 57
(c) No Existing Default....................................................................... 57
ARTICLE VI
REPRESENTATIONS AND WARRANTIES..................................... 58
6.1 Corporate Existence and Power..................................................................... 58
6.2 Corporate Authorization; No Contravention......................................................... 58
6.3 Governmental Authorization........................................................................ 59
6.4 Binding Effect.................................................................................... 59
6.5 Litigation........................................................................................ 59
-ii-
4
Section Page
6.6 No Default........................................................................................ 59
6.7 ERISA Compliance.................................................................................. 60
6.8 Use of Proceeds; Margin Regulations............................................................... 60
6.9 Title to Properties............................................................................... 60
6.10 Taxes............................................................................................. 61
6.11 Financial Condition............................................................................... 61
6.12 Environmental Matters............................................................................. 62
6.13 Regulated Entities................................................................................ 62
6.14 No Burdensome Restrictions........................................................................ 62
6.15 Copyrights, Patents, Trademarks and Licenses, etc................................................. 63
6.16 Subsidiaries...................................................................................... 63
6.17 Insurance......................................................................................... 63
6.18 Solvency, etc..................................................................................... 63
6.19 Purchase, etc..................................................................................... 63
6.20 Real Property..................................................................................... 64
6.21 Swap Obligations.................................................................................. 64
6.22 Full Disclosure................................................................................... 64
ARTICLE VII
AFFIRMATIVE COVENANTS............................................. 65
7.1 Financial Statements.............................................................................. 65
7.2 Certificates; Other Information................................................................... 66
7.3 Notices........................................................................................... 67
7.4 Preservation of Corporate Existence, Etc.......................................................... 68
7.5 Maintenance of Property........................................................................... 68
7.6 Insurance......................................................................................... 69
7.7 Payment of Obligations............................................................................ 69
7.8 Compliance with Laws.............................................................................. 69
7.9 Compliance with ERISA............................................................................. 69
7.10 Inspection of Property and Books and Records...................................................... 69
7.11 Environmental Laws................................................................................ 70
7.12 Interest Rate Protection.......................................................................... 70
7.13 Use of Proceeds................................................................................... 70
7.14 Further Assurances................................................................................ 70
ARTICLE VIII
NEGATIVE COVENANTS............................................... 71
8.1 Limitation on Liens............................................................................... 71
8.2 Disposition of Assets............................................................................. 73
8.3 Consolidations and Mergers........................................................................ 73
8.4 Loans and Investments............................................................................. 73
8.5 Limitation on Indebtedness........................................................................ 74
8.6 Transactions with Affiliates...................................................................... 75
8.7 Use of Proceeds................................................................................... 76
8.8 Contingent Obligations............................................................................ 76
8.9 Joint Ventures.................................................................................... 76
8.10 Lease Obligations................................................................................. 76
8.11 Minimum Fixed Charge Coverage..................................................................... 77
-iii-
5
Section Page
8.12 Minimum Interest Coverage......................................................................... 77
8.13 Maximum Leverage.................................................................................. 77
8.14 Minimum Net Worth................................................................................. 77
8.15 Maximum Capital Expenditures...................................................................... 78
8.16 Restricted Payments............................................................................... 78
8.17 ERISA............................................................................................. 79
8.18 Change in Business................................................................................ 79
8.19 Amendments to Certain Documents................................................................... 79
8.20 Accounting Changes................................................................................ 79
ARTICLE IX
EVENTS OF DEFAULT............................................... 79
9.1 Event of Default........................................................................................ 79
(a) Non-Payment............................................................................... 79
(b) Representation or Warranty................................................................ 79
(c) Specific Defaults......................................................................... 80
(d) Other Defaults............................................................................ 80
(e) Cross-Default............................................................................. 80
(f) Insolvency; Voluntary Proceedings......................................................... 80
(g) Involuntary Proceedings................................................................... 81
(h) ERISA..................................................................................... 81
(i) Monetary Judgments........................................................................ 81
(j) Non-Monetary Judgments.................................................................... 81
(k) Change of Control......................................................................... 81
(l) Guarantor Defaults........................................................................ 82
(m) Collateral Documents, etc................................................................. 82
9.2 Remedies.......................................................................................... 82
9.3 Rights Not Exclusive.............................................................................. 83
ARTICLE X
THE AGENT................................................... 83
10.1 Appointment and Authorization..................................................................... 83
10.2 Delegation of Duties.............................................................................. 83
10.3 Liability of Agent................................................................................ 84
10.4 Reliance by Agent................................................................................. 84
10.5 Notice of Default................................................................................. 85
10.6 Credit Decision................................................................................... 85
10.7 Indemnification of Agent.......................................................................... 85
10.8 Agent in Individual Capacity...................................................................... 86
10.9 Successor Agent................................................................................... 86
10.10 Withholding Tax................................................................................... 87
10.11 Collateral Matters................................................................................ 88
ARTICLE XI
MISCELLANEOUS................................................. 89
11.1 Amendments and Waivers............................................................................ 89
11.2 Notices........................................................................................... 90
-iv-
6
Section Page
11.3 No Waiver; Cumulative Remedies.................................................................... 91
11.4 Costs and Expenses................................................................................ 91
11.5 Company Indemnification........................................................................... 92
11.6 Payments Set Aside................................................................................ 92
11.7 Successors and Assigns............................................................................ 92
11.8 Assignments, Participations, etc.................................................................. 93
11.9 Confidentiality................................................................................... 94
11.10 Set-off........................................................................................... 95
11.11 Automatic Debits of Fees.......................................................................... 95
11.12 Notification of Addresses, Lending Offices, Etc................................................... 96
11.13 Counterparts...................................................................................... 96
11.14 Severability...................................................................................... 96
11.15 No Third Parties Benefited........................................................................ 96
11.16 Governing Law and Jurisdiction.................................................................... 96
11.17 Waiver of Jury Trial.............................................................................. 97
11.18 Subsidiary References............................................................................. 97
11.19 Entire Agreement.................................................................................. 97
-v-
7
SCHEDULES
Schedule 1.1 Commitments, Revolving Percentages, Term A
Percentages, Term B Percentages
Schedule 6.5 Litigation
Schedule 6.11 Permitted Liabilities
Schedule 6.12 Environmental Matters
Schedule 6.16 Subsidiaries and Minority Interests
Schedule 6.17 Insurance Matters
Schedule 6.20 Real Property
Schedule 8.1 Permitted Liens
Schedule 8.5 Permitted Indebtedness
Schedule 8.8 Contingent Obligations
Schedule 11.2 Lending Offices; Addresses for Notices
EXHIBITS
Exhibit A Form of Notice of Borrowing
Exhibit B Form of Notice of Conversion/Continuation
Exhibit C Form of Compliance Certificate
Exhibit D Form of Promissory Note
Exhibit E Form of Security Agreement
Exhibit F Form of Trademark Security Agreement
Exhibit G Form of Guaranty
Exhibit H Form of Company Pledge Agreement
Exhibit I Form of Parent Pledge Agreement
Exhibit J Form of Landlord's Consent
Exhibit K Form of Purchase Agreement Assignment
Exhibit L Form of Opinion of Counsel to the Company and
the Parent
Exhibit M Form of Opinion of Local Counsel to the Company
Exhibit N Intentionally Omitted
Exhibit O Form of Opinion of Special Counsel to the Agent
Exhibit P Form of Solvency Opinion
Exhibit Q Form of Assignment and Acceptance
Exhibit R Form of Patent Security Agreementy
-vi-
8
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of October 6, 1995, among
FIBERITE, INC., a Delaware corporation (the "Company"), the several financial
institutions from time to time party to this Agreement (collectively the
"Lenders"; individually each a "Lender"), and BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as agent for the Lenders.
WHEREAS, the Lenders have agreed to make available to the Company term
loans and a revolving credit facility with a letter of credit subfacility upon
the terms and conditions set forth in this Agreement;
NOW, THEREFORE, in consideration of the mutual agreements, provisions
and covenants contained herein, the parties agree as follows:
ARTICLE I
DEFINITIONS
1.1 Certain Defined Terms. The following terms have the following
meanings:
Acquired Businesses means ICI Composites, Inc. and
Fiberite Europe GmbH.
Acquisition means any transaction or series of related
transactions for the purpose of, or resulting directly or indirectly
in, (a) the acquisition of all or substantially all of the assets of a
Person, or of any business or division of a Person, (b) the acquisition
of in excess of 50% of the capital stock, partnership interests,
membership interests or equity of any Person, or otherwise causing any
Person to become a Subsidiary, or (c) a merger or consolidation or any
other combination with another Person (other than a Person that is a
Subsidiary) provided that the Company or a Subsidiary is the surviving
entity.
Adjusted Working Capital means the excess of:
(a) (i) the consolidated current assets of the Company and its
Subsidiaries, less (ii) the amount of cash and cash equivalents
included in such consolidated current assets;
over
(b) (i) consolidated current liabilities of the Company and
its Subsidiaries, less (ii) the amount of short-term Indebtedness
(including current maturities of long-term
-1-
9
Indebtedness) of the Company and its Subsidiaries included in such
consolidated current liabilities.
Affected Lender -- see Section 4.7.
Affiliate means, as to any Person, any other Person which,
directly or indirectly, is in control of, is controlled by, or is under
common control with, such Person. A Person shall be deemed to control
another Person if the controlling Person possesses, directly or
indirectly, the power to direct or cause the direction of the
management and policies of such other Person, whether through the
ownership of voting securities or membership interests, by contract, or
otherwise. Without limiting the foregoing, any Person which is an
officer, director or shareholder of the Company, or a member of the
immediate family of any such officer, director or shareholder, shall be
deemed to be an Affiliate of the Company.
Agent means BofA in its capacity as agent for the Lenders
hereunder, and any successor agent arising under Section 10.9.
Agent-Related Persons means BofA and any successor agent
arising under Section 10.9, together with their respective Affiliates
(including the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
Agent's Payment Office means the address for payments set
forth on Schedule 11.2 in relation to the Agent, or such other address
as the Agent may from time to time specify.
Agreement means this Credit Agreement.
Applicable Base Rate Margin means (a) initially, 1.50% in the
case of any Revolving Loan or Term A Loan bearing interest based on the
Base Rate and 2.00% in the case of any Term B Loan bearing interest
based on the Base Rate, and (b) on and after any date specified below
on which the Applicable Base Rate Margin is to be adjusted, the rate
per annum set forth in the table below for the applicable Loan opposite
the applicable Leverage Ratio and Interest Coverage Ratio:
-2-
10
Applicable Base Applicable
Leverage Ratio Rate Margin for Base Rate
and Interest Revolving Loans Margin for
Coverage Ratio and Term A Loans Term B Loans
Leverage Ratio greater
than 3.00 to 1 or 1.50% 2.00%
Interest Coverage
Ratio less than 3.50 to 1
Leverage Ratio less
than 3.00 to 1 1.25% 2.00%
and Interest Coverage
Ratio greater than 3.50 to 1
Leverage Ratio less than 2.50 1.00% 2.00%
to 1 and Interest Coverage
Ratio greater than 4.00 to 1
The Applicable Base Rate Margin shall be adjusted, to the extent
applicable, 45 days (or, in the case of the last calendar quarter of
any year, 90 days) after the end of each calendar quarter, based on the
Leverage Ratio and Interest Coverage Ratio as of the last day of such
calendar quarter; it being understood that if the Company fails to
deliver the financial statements required by subsection 7.1(a) or
7.1(b)(ii), as applicable, and the related Compliance Certificate
required by subsection 7.2(b) by the 45th day (or, if applicable, the
90th day) after any calendar quarter, the Applicable Base Rate Margin
shall be 1.50% for any Revolving Loan or Term A Loan bearing interest
based on the Base Rate and 2.00% for Term B Loan bearing interest based
on the Base Rate until such financial statements and Compliance
Certificate are delivered. Notwithstanding the foregoing, the
Applicable Base Rate Margin shall not be reduced at any time before
September 30, 1996.
Applicable Offshore Rate Margin means (a) initially, 2.75% in
the case of any Revolving Loan or Term A Loan bearing interest based on
the Offshore Rate and 3.25% in the case of any Term B Loan bearing
interest based on the Offshore Rate, and (b) on and after any date
specified below on which the Applicable Offshore Rate Margin is to be
adjusted, the rate per annum set forth in the table below for the
applicable Loan opposite the applicable Leverage Ratio and Interest
Coverage Ratio:
-3-
11
Applicable Applicable
Offshore Offshore
Leverage Ratio Rate Margin for Rate
and Interest Revolving Loans Margin for
Coverage Ratio and Term A Loans Term B Loans
Leverage Ratio greater
than 3.00 to 1 or 2.75% 3.25%
Interest Coverage
Ratio less than 3.50 to 1
Leverage Ratio less
than 3.00 to 1 and 2.50% 3.25%
Interest Coverage
Ratio greater than 3.50 to 1
Leverage Ratio less than 2.50 2.25% 3.25%
to 1 and Interest Coverage
Ratio greater than 4.00 to 1
The Applicable Offshore Rate Margin shall be adjusted, to the extent
applicable, 45 days (or, in the case of the last calendar quarter of
any year, 90 days) after the end of each calendar quarter, based on the
Leverage Ratio and Interest Coverage Ratio as of the last day of such
quarter; it being understood that if the Company fails to deliver the
financial statements required by subsection 7.1(a) or 7.1(b)(ii), as
applicable, and the related Compliance Certificate required by
subsection 7.2(b) by the 45th day (or, if applicable, the 90th day)
after any calendar quarter, the Applicable Offshore Rate Margin shall
be 2.75% for Revolving Loans and Term A Loans bearing interest based on
the Offshore Rate and 3.25% for Term B Loans bearing interest based on
the Offshore Rate until such financial statements and Compliance
Certificate are delivered. Notwithstanding the foregoing, the
Applicable Offshore Rate Margin shall not be reduced at any time before
September 30, 1996.
Arranger means BA Securities, Inc., a Delaware corporation.
Assignee - see subsection 11.8(a).
Assignment and Acceptance - see subsection 11.8(a).
Attorney Costs means and includes (i) all reasonable fees and
disbursements of any law firm or other external counsel and (ii) the
reasonable allocated cost of internal legal services and all reasonable
disbursements of internal counsel incurred after the Closing Date.
-4-
12
BAI means Bank of America Illinois, an Illinois banking
corporation.
Bankruptcy Code means the Federal Bankruptcy Reform Act
of 1978 (11 U.S.C. Section101, et seq.).
Base Rate means, for any day, the higher of: (a) 0.50% per
annum above the latest Federal Funds Rate; and (b) the rate of interest
in effect for such day as publicly announced from time to time by BAI
in Chicago, Illinois as its "reference rate." (The "reference rate" is
a rate set by BAI based upon various factors including BAI's costs and
desired return, general economic conditions and other factors, and is
used as a reference point for pricing some loans, which may be priced
at, above, or below such announced rate.) Any change in the reference
rate announced by BAI shall take effect at the opening of business on
the day specified in the public announcement of such change.
Base Rate Loan means a Loan that bears interest based on the
Base Rate.
BofA means Bank of America National Trust and Savings
Association, a national banking association.
Borrowing means a borrowing hereunder consisting of Revolving
Loans, Term A Loans or Term B Loans of the same Type made to the
Company on the same day by the Lenders under Article II and, in the
case of Offshore Rate Loans, having the same Interest Period.
Borrowing Date means any date on which a Borrowing occurs
under Section 2.3.
Business Day means any day other than a Saturday, Sunday or
other day on which commercial banks in New York City, Chicago or San
Francisco are authorized or required by law to close and, if the
applicable Business Day relates to any Offshore Rate Loan, means such a
day on which dealings are carried on in the applicable offshore dollar
interbank market.
Capital Adequacy Regulation means any guideline, request or
directive of any central bank or other Governmental Authority, or any
other law, rule or regulation, whether or not having the force of law,
in each case regarding capital adequacy of any bank or of any
corporation controlling a bank.
Capital Expenditures means all expenditures which, in
accordance with GAAP, would be required to be capitalized and shown on
the consolidated balance sheet of the Company, but excluding
expenditures made in connection with the replacement, substitution or
restoration of assets to the
-5-
13
extent financed (i) from insurance proceeds (or other similar
recoveries) paid on account of the loss of or damage to the assets
being replaced or restored or (ii) with awards of compensation arising
from the taking by eminent domain or condemnation of the assets being
replaced.
Carlisle means Carlisle Enterprises, L.P.
Cash Collateralize means to pledge and deposit with or deliver
to the Agent, for the benefit of the Agent, the Issuing Lenders and the
Lenders, as additional collateral for the L/C Obligations, cash or
deposit account balances pursuant to documentation in form and
substance satisfactory to the Agent and the Issuing Lenders (which
documents are hereby consented to by the Lenders). Derivatives of such
term shall have corresponding meanings. The Company hereby grants the
Agent, for the benefit of the Agent, the Issuing Lenders and the
Lenders, a security interest in all such cash and deposit account
balances. Cash collateral shall be maintained in blocked, non-interest
bearing deposit accounts at BAI.
"Cash Equivalent Investments" shall mean (i) securities issued
or directly and fully guaranteed or insured by the United States of
America or any agency or instrumentality thereof (provided that the
full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than three years from
the date of acquisition, (ii) marketable direct obligations issued by
any State of the United States of America or any local government or
other political subdivision thereof rated (at the time of acquisition
of such security) at least AA by Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc. ("S&P") or the equivalent
thereof by Xxxxx'x Investors Service, Inc. ("Moody's") having
maturities of not more than one year from the date of acquisition,
(iii) U.S. dollar denominated time deposits, certificates of deposit
and bankers' acceptances of (x) any Lender, (y) any domestic commercial
bank of recognized standing having capital and surplus in excess of
$250,000,000 or (z) any bank whose short-term commercial paper rating
(at the time of acquisition of such security) by S&P is at least A-1 or
the equivalent thereof (any such bank, an "Approved Bank"), in each
case with maturities of not more than six months from the date of
acquisition, (iv) commercial paper and variable or fixed rate notes
issued by any Lender or Approved Bank or by the parent company of any
Lender or Approved Bank and commercial paper and variable rate notes
issued by, or guaranteed by, any industrial or financial company with a
short-term commercial paper rating (at the time of acquisition of such
security) of at least A-1 or the equivalent thereof by S&P or at least
P-1 or the equivalent thereof by Moody's, or guaranteed by any
industrial company with a long-term unsecured debt rating
-6-
14
(at the time of acquisition of such security) of at least AA or the
equivalent thereof by S&P or at least Aa or the equivalent thereof by
Moody's and in each case maturing within one year after the date of
acquisition and (v) repurchase agreements with any Lender or any
primary dealer maturing within one year from the date of acquisition
that are fully collateralized by investment instruments that would
otherwise be Cash Equivalent Investments; provided that the terms of
such repurchase agreements comply with the guidelines set forth in the
Federal Financial Institutions Examination Council Supervisory Policy
-- Repurchase Agreements of Depository Institutions With Securities
Dealers and Others, as adopted by the Comptroller of the Currency on
October 31, 1985.
CFILP means Carlisle-Fiberite Investors, L.P.
Change of Control means that (i) DLJMB and CFILP collectively
cease to own, beneficially and of record, at least 51% of each class of
capital stock of the Parent; (ii) any Person, or two or more Persons
acting in concert, acquires the beneficial ownership of 15% or more of
any class of capital stock of the Company; or (iii) the Parent ceases
to own, beneficially and of record, 100% of each class of capital stock
of the Company.
Closing Date means the date on which all conditions precedent
set forth in Sections 5.1 and 5.2 are satisfied or waived by all
Lenders (or, in the case of subsection 5.1(g), waived by the Person
entitled to receive the applicable payment).
Code means the Internal Revenue Code of 1986.
Collateral Document means the Security Agreement, each
Trademark Security Agreement, each Patent Security Agreement, each
Pledge Agreement, each Mortgage and any other document pursuant to
which collateral securing the liabilities of the Company or any
Guarantor under any Loan Document is granted to the Agent for the
benefit of itself and the Lenders.
Commercial Letter of Credit means any Letter of Credit which
is drawable upon presentation of a sight draft and other documents
evidencing the sale or shipment of goods purchased by the Company in
the ordinary course of business.
Commitment means, as to each Lender, such Lender's Revolving
Commitment, Term A Commitment or Term B Commitment, as applicable.
Company - See the Preamble.
Company Pledge Agreement - see subsection 5.1(k).
-7-
15
Compliance Certificate means a certificate substantially in
the form of Exhibit C.
Computation Period means (a) the period from the Closing Date
through Xxxxx 00, 0000, (x) the period from the Closing Date through
June 30, 1996, (c) the period from the Closing Date through September
30, 1996 and (d) any period of four consecutive fiscal quarters ending
on or after December 31, 1996.
Consolidated Net Income means, with respect to the Company and
its Subsidiaries for any period, the net income (or loss) of the
Company and its Subsidiaries for such period.
Contingent Obligation means, as to any Person, any direct or
indirect liability of such Person, whether or not contingent, with or
without recourse, (a) with respect to any Indebtedness, lease,
dividend, letter of credit or other obligation (the "primary
obligation") of another Person (the "primary obligor"), including any
obligation of such Person (i) to purchase, repurchase or otherwise
acquire such primary obligation or any security therefor, (ii) to
advance or provide funds for the payment or discharge of any primary
obligation, or to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency or
any balance sheet item, level of income or financial condition of the
primary obligor, (iii) to purchase property, securities or services
primarily for the purpose of assuring the owner of any primary
obligation of the ability of the primary obligor to make payment of
such primary obligation, or (iv) otherwise to assure or hold harmless
the holder of any primary obligation against loss in respect thereof
(each, a "Guaranty Obligation"); (b) with respect to any Surety
Instrument (other than any Letter of Credit) issued for the account of
such Person or as to which such Person is otherwise liable for
reimbursement of drawings or payments; (c) to purchase any materials,
supplies or other property from, or to obtain the services of, another
Person if the relevant contract or other related document or obligation
requires that payment for such materials, supplies or other property,
or for such services, shall be made regardless of whether delivery of
such materials, supplies or other property is ever made or tendered, or
such services are ever performed or tendered; or (d) in respect of any
Swap Contract. The amount of any Contingent Obligation shall, (a) in
the case of Guaranty Obligations, be deemed equal to the stated or
determinable amount of the primary obligation in respect of which such
Guaranty Obligation is made or, if not stated or if indeterminable, the
maximum reasonably anticipated liability in respect thereof, and (b) in
the case of Swap Contracts, be equal to the Swap Termination Value, and
(c) in the case
-8-
16
of other Contingent Obligations, be equal to the maximum reasonably
anticipated liability in respect thereof.
Contractual Obligation means, as to any Person, any provision
of any security issued by such Person or of any agreement, undertaking,
contract, indenture, mortgage, deed of trust or other instrument,
document or agreement to which such Person is a party or by which it or
any of its property is bound.
Conversion/Continuation Date means any date on which, under
Section 2.4, the Company (a) converts Loans of one Type to the other
Type or (b) continues as Offshore Rate Loans, but with a new Interest
Period, Offshore Rate Loans having Interest Periods expiring on such
date.
Credit Extension means and includes (a) the making of any Loan
hereunder and (b) the Issuance of any Letter of Credit hereunder.
Defense Agreement means any agreement entered into between the
Company and United States Department of Defense concerning the disclosure of
information to third parties so long as such agreement is not materially more
adverse to the Lenders with respect to their inspection, audit and visitation
rights than the draft dated October 2, 1995 of the Special Security Agreement
among AXA, The Equitable Companies Incorporated, Xxxxxxxxx, Xxxxxx & Xxxxxxxx,
Inc., DLJ Capital Investors, Inc., DLJ Merchant Banking, Inc., Parent, Company,
and the United States Department of Defense.
DLJMB means DLJ Merchant Banking, Inc. and its
Affiliates.
Dollars and $ mean lawful money of the United States.
Dollar Amount means, in relation to any Indebtedness (i)
denominated in Dollars, the amount of such Indebtedness, and (ii)
denominated in a currency other than Dollars, the Dollar Equivalent of
the amount of such Indebtedness on the last day of the
immediately-preceding calendar month.
Dollar Equivalent means, in relation to an amount denominated
in a currency other than Dollars, the amount of Dollars which could be
purchased with such amount at the prevailing foreign exchange spot
rate.
EBITDA means, for any Computation Period, the sum of
(a) Consolidated Net Income of the Company for such period
excluding, to the extent reflected in determining such Consolidated Net
Income, extraordinary gains and losses for such period and other
non-cash or non-recurring charges
-9-
17
related to but not limited to the adoption of new accounting policies
and plant consolidations or restructurings,
plus
(b) to the extent deducted in determining Consolidated Net
Income, Interest Expense, income tax expense, depreciation, depletion
and amortization for such period.
Effective Amount means, with respect to any outstanding L/C
Obligations on any date, (i) the amount of such L/C Obligations on such
date after giving effect to any Issuances of Letters of Credit
occurring on such date; (ii) the amount of any undrawn Commercial
Letters of Credit which have expired less than 25 days prior to such
date; and (iii) any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any
reimbursements of outstanding unpaid drawings under any Letter of
Credit or any reduction in the maximum amount available for drawing
under Letters of Credit taking effect on such date.
Eligible Assignee means (i) a commercial bank organized under
the laws of the United States, or any state thereof, and having a
combined capital and surplus of at least $100,000,000; (ii) a
commercial bank organized under the laws of any other country which is
a member of the Organization for Economic Cooperation and Development
(the "OECD"), or a political subdivision of any such country, and
having a combined capital and surplus of at least $100,000,000,
provided that such bank is acting through a branch or agency located in
the United States; and (iii) a Person that is primarily engaged in the
business of commercial banking and that is (A) a Subsidiary of a
Lender, (B) a Subsidiary of a Person of which a Lender is a Subsidiary,
or (C) a Person of which a Lender is a Subsidiary.
Environmental Claims means all claims, however asserted, by
any Governmental Authority or other Person alleging potential liability
under any Environmental Law or responsibility for violation of any
Environmental Law.
Environmental Laws means all federal, state or local laws,
statutes, the common law, rules, regulations, ordinances and codes
relating to pollution or protection of public or employee health or the
environment, together with all administrative orders, consent decrees,
licenses, authorizations and permits of any Governmental Authority
implementing them.
ERISA means the Employee Retirement Income Security Act of
1974, as amended, and regulations promulgated thereunder.
-10-
18
ERISA Affiliate means any trade or business (whether or not
incorporated) under common control with the Company within the meaning
of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of
the Code for purposes of provisions relating to Section 412 of the
Code).
ERISA Event means (a) a Reportable Event with respect to a
Pension Plan; (b) a withdrawal by the Company or any ERISA Affiliate
from a Pension Plan subject to Section 4063 of ERISA during a plan year
in which it was a substantial employer (as defined in Section
4001(a)(2) of ERISA) or a substantial cessation of operations which is
treated as such a withdrawal; (c) a complete or partial withdrawal by
the Company or any ERISA Affiliate from a Multiemployer Plan or
notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Pension
Plan amendment as a termination under Section 4041 or 4041A of ERISA,
or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which might
reasonably be expected to constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than PBGC
premiums under Section 4007 of ERISA, upon the Company or any ERISA
Affiliate.
Event of Default means any of the events or circumstances
specified in Section 9.1.
Excess Cash Flow means, for any period, the remainder
of
(a) the sum, without duplication, of
(i) Consolidated Net Income for such period,
excluding (a) any extraordinary gains or losses and other
non-cash or, to the extent not paid in cash during such
period, non-recurring charges related to but limited to the
adoption of new accounting policies and plant consolidations
or restructurings and (b) any gains or losses on the sale of
any property to the extent the sale of such property gave rise
to a prepayment pursuant to Section 2.7,
plus
(ii) all depreciation and amortization of assets
(including goodwill and other intangible assets) of the
Company and its Subsidiaries deducted in determining
Consolidated Net Income for such period,
plus
-11-
19
(iii) any net decrease in Adjusted Working Capital
during such period (exclusive of decreases in working capital
associated with asset sales),
plus
(iv) all federal, state, local and foreign income
taxes (whether paid or deferred) of the Company and its
Subsidiaries deducted in determining Consolidated Net Income
for such period,
less
(b) the sum, without duplication, of
(i) repayments of principal of Term Loans pursuant to
Section 2.7 or Section 2.8, regularly scheduled principal
payments arising with respect to any other long-term
Indebtedness of the Company and its Subsidiaries, and the
portion of any regularly scheduled payments with respect to
capital leases allocable to principal, in each case made
during such period,
plus
(ii) voluntary prepayments of the Term Loans
pursuant to Section 2.6 during such period,
plus
(iii) Capital Expenditures for such period,
plus
(iv) all federal, state, local and foreign
income taxes paid by the Company and its Subsidiaries
during such period,
plus
(v) any net increase in Adjusted Working Capital
during such period (exclusive of increases in working capital
associated with asset sales),
plus
(vi) any non-cash pension income during such
period.
plus
-12-
20
(vii) any amounts paid pursuant to the purchase
price adjustments set forth in Section 2.3 of the U.S.
Purchase Agreement and Section 2.9 of the German Purchase
Agreement.
Exchange Act means the Securities Exchange Act of 1934, and
regulations promulgated thereunder.
Federal Funds Rate means, for any day, the rate set forth in
the weekly statistical release designated as H.15(519), or any
successor publication, published by the Federal Reserve Bank of New
York (including any such successor, "H.15(519)") on the preceding
Business Day opposite the caption "Federal Funds (Effective)"; or, if
for any relevant day such rate is not so published on any such
preceding Business Day, the rate for such day will be the arithmetic
mean as determined by the Agent of the rates for the last transaction
in overnight Federal funds arranged prior to 9:00 a.m. (New York City
time) on that day by each of three leading brokers of Federal funds
transactions in New York City selected by the Agent.
Fee Letter -- see subsection 2.10(a).
Financial Standby Letter of Credit means any Standby Letter of
Credit which any Lender is required under any Requirement of Law
(including under 12 CFR Part 3, Appendix A, Section 3, clause (b)) to
classify as a financial letter of credit with respect to its issuance
thereof or participation therein pursuant to this Agreement.
Fixed Charge Coverage Ratio means, for the Computation Period
most recently ended on or before such date, the ratio of (a) (i) EBITDA
for such Computation Period less (ii) Capital Expenditures (other than
MIS Expenditures) for such Computation Period to (b) the sum of (i)
Interest Expense for such Computation Period, (ii) cash taxes paid by
the Company and its Subsidiaries for such Computation Period and (iii)
the required installments of principal of the Term Loans for such
Computation Period.
Foreign Subsidiary shall mean each Subsidiary of the Company
organized under the laws of any jurisdiction other than, or conducting
substantially all of its operations or holding substantially all of its
assets outside, the United States.
FRB means the Board of Governors of the Federal Reserve
System, and any Governmental Authority succeeding to any of its
principal functions.
Funded Debt means all Indebtedness of the Company and its
Subsidiaries, excluding (i) Indebtedness of the Company to Subsidiaries
or of Subsidiaries to the Company or other
-13-
21
Subsidiaries and (ii) Indebtedness of the Company and its Subsidiaries
in respect of Swap Contracts.
GAAP means generally accepted accounting principles set forth
from time to time in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of
comparable stature and authority within the U.S. accounting
profession), which are applicable to the circumstances as of the date
of determination.
German Purchase Agreement means the Business Purchase
Agreement dated as of the Closing Date between Fiberite Europe GmbH, as
seller, and XXXXX Verwaltungsgesellschaft mbh as buyer, and the Parent,
as guarantor, amended from time to time in accordance with Section
8.19.
German Transition Services Agreement means the Transition
Services Agreement dated as of the Closing Date, between Deutsche ICI
GmbH and XXXXX Verwaltungsgesellschaft mbh as amended from time to time
in accordance with Section 8.19.
Governmental Authority means any nation or government, any
state or other political subdivision thereof, any central bank (or
similar monetary or regulatory authority) thereof, any entity
exercising executive, legislative, judicial, 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.
Guarantor means (a) as of the Closing Date, the Parent and (b)
thereafter, the Parent and each other Person which from time to time
executes and delivers a counterpart of the Guaranty.
Guaranty means the guaranty substantially in the form of
Exhibit G which will be executed by the Parent on the Closing Date and
from time to time by other Guarantors.
Guaranty Obligation has the meaning specified in the
definition of Contingent Obligation.
Honor Date -- see subsection 3.3(b).
Indebtedness of any Person means, without duplication, (a) all
indebtedness of such Person for borrowed money; (b) all obligations
issued, undertaken or assumed by such Person as the deferred purchase
price of property or services (other than trade payables entered into
in the ordinary course of business on ordinary terms); (c) all non-
-14-
22
contingent reimbursement or payment obligations with respect to Surety
Instruments; (d) all obligations of such Person evidenced by notes,
bonds, debentures or similar instruments; (e) all indebtedness of such
Person created or arising under any conditional sale or other title
retention agreement, or incurred as financing, in either case with
respect to property acquired by such Person (even though the rights and
remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property); (f) all
obligations of such Person with respect to capital leases; (g) all
indebtedness referred to in clause (a) through (f) above secured by (or
for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) any Lien upon or in property
(including accounts and contracts rights) owned by such Person, even
though such Person has not assumed or become liable for the payment of
such Indebtedness; and (h) all Guaranty Obligations of such Person in
respect of indebtedness or obligations of others of the kinds referred
to in clauses (a) through (g) above.
Indemnified Liabilities -- see Section 11.5.
Indemnified Person -- see Section 11.5.
Independent Auditor -- see subsection 7.1(a).
Initial Parent Stockholders means the purchasers under
the Securities Purchase Agreement.
Insolvency Proceeding means, with respect to any Person, (a)
any case, action or proceeding with respect to such Person before any
court or other Governmental Authority relating to bankruptcy,
reorganization, insolvency, liquidation, receivership, dissolution,
winding-up or relief of debtors (including any proceeding under the
Bankruptcy Code) or (b) any general assignment for the benefit of
creditors, composition, marshalling of assets for creditors, or other,
similar arrangement in respect of such Person's creditors generally or
any substantial portion of such creditors.
Interest Coverage Ratio means, for the Computation Period most
recently ended on or before such date, the ratio of (a) EBITDA for such
Computation Period to (b) Interest Expense for such Computation Period.
Interest Expense means for any period the consolidated
interest expense of the Company and its Subsidiaries for such period
(including all imputed interest on capital leases but excluding
amortization of fees and expenses in connection with the Purchase, this
Agreement and the transactions contemplated by the foregoing).
-15-
23
Interest Payment Date means (i) as to any Offshore Rate Loan,
the last day of each Interest Period applicable to such Loan and, in
the case of any Offshore Rate Loan with a six-month Interest Period,
the three-month anniversary of the first day of such Interest Period,
and (ii) as to any Base Rate Loan, the last Business Day of each
calendar quarter.
Interest Period means, as to any Offshore Rate Loan, the
period commencing on the Borrowing Date of such Loan or on the
Conversion/Continuation Date on which the Loan is converted into or
continued as an Offshore Rate Loan, and ending (i) in the case of
Offshore Rate Loans made or converted during the period from the
Closing Date through the earlier of November 1, 1995 and the Primary
Syndication Date, one week thereafter and (ii) in the case of Offshore
Rate Loans made or converted at any time after the earlier of November
1, 1995 and the Primary Syndication Date, one, two, three or six months
thereafter, as selected by the Company in its Notice of Borrowing or
Notice of Conversion/Continuation; provided that:
(i) if any Interest Period would otherwise end on a
day that is not a Business Day, such Interest Period shall be
extended to the following Business Day unless the result of
such extension would be to carry such Interest Period into
another calendar month, in which event such Interest Period
shall end on the preceding Business Day;
(ii) any Interest Period 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 calendar month at the end of such Interest
Period;
(iii) no Interest Period applicable to a Term A Loan
or a Term B Loan or portion of either thereof shall extend
beyond any date upon which is due any scheduled principal
payment in respect of the Term A Loans or Term B Loans, as
applicable, unless the aggregate principal amount of Term A
Loans or Term B Loans, as applicable, represented by Base Rate
Loans, or by Offshore Rate Loans having Interest Periods that
will expire on or before such date, equals or exceeds the
amount of such principal payment; and
(iv) no Interest Period for any Revolving Loan shall
extend beyond the scheduled Revolving Termination Date.
-16-
24
IRS means the Internal Revenue Service, and any Governmental
Authority succeeding to any of its principal functions under the Code.
Issuance Date -- see subsection 3.1(a).
Issue means, with respect to any Letter of Credit, to issue or
to extend the expiry of, or to renew or increase the amount of, such
Letter of Credit; and the terms "Issued," "Issuing" and "Issuance" have
corresponding meanings.
Issuing Lender means each of BAI and in its capacity as issuer
of one or more Letters of Credit hereunder, together with (i) any
replacement letter of credit issuer arising under subsection 10.1(b) or
Section 10.9 and (ii) any other Lender which the Agent and the Company
have approved in writing as an "Issuing Lender" hereunder.
Joint Venture means a corporation, partnership, limited
liability company, joint venture or other similar legal arrangement
(whether created by contract or conducted through a separate legal
entity) which is not a Subsidiary of the Company or any of its
Subsidiaries and which is now or hereafter formed by the Company or any
of its Subsidiaries with another Person in order to conduct a common
venture or enterprise with such Person.
Landlord's Consent means a document substantially in the form
of Exhibit J, with appropriate insertions, or such other form as shall
be acceptable to the Required Lenders.
L/C Advance means each Lender's participation in any L/C
Borrowing in accordance with its Revolving Percentage.
L/C Amendment Application means an application form for
amendment of an outstanding standby or commercial documentary letter of
credit as shall at any time be in use at the applicable Issuing Lender,
as such Issuing Lender shall request.
L/C Application means an application form for issuances of a
standby or commercial documentary letter of credit as shall at any time
be in use at the applicable Issuing Lender, as such Issuing Lender
shall request.
L/C Borrowing means an extension of credit resulting from a
drawing under any Letter of Credit which shall not have been reimbursed
on the date when made nor converted into a Borrowing of Revolving Loans
under subsection 3.3(c).
L/C Commitment means the commitment of the Issuing Lenders to
Issue, and the commitment of the Lenders severally to participate in,
Letters of Credit from time to
-17-
25
time Issued or outstanding under Article III, in an aggregate amount
not to exceed on any date the lesser of $10,000,000 and the amount of
the Revolving Commitment; it being understood that the L/C Commitment
is a part of the Revolving Commitment, rather than a separate,
independent commitment.
L/C Fee Rate means, at any time, (i) 0.50% in the case of each
Commercial Letter of Credit and (ii) the Applicable Offshore Rate
Margin for Revolving Loans in the case of each Financial Standby Letter
of Credit and each Non-Financial Standby Letter of Credit; provided
that each of the foregoing rates shall be increased by 2% at any time
an Event of Default exists.
L/C Obligations means at any time the sum of (a) the aggregate
undrawn amount of all Letters of Credit then outstanding, plus (b) the
amount of all unreimbursed drawings under all Letters of Credit,
including all outstanding L/C Borrowings.
L/C-Related Documents means the Letters of Credit, the L/C
Applications, the L/C Amendment Applications and any other document
relating to any Letter of Credit, including any of the applicable
Issuing Lender's standard form documents for letter of credit
issuances.
Lender has the meaning specified in the introductory clause
hereto. References to the "Lenders" shall include each Issuing Lender
in its capacity as such; for purposes of clarification only, to the
extent that any Issuing Lender may have any rights or obligations in
addition to those of the other Lenders due to its status as Issuing
Lender, its status as such will be specifically referenced.
Lending Office means, as to any Lender, the office or offices
of such Lender specified as its "Lending Office" or "Domestic Lending
Office" or "Offshore Lending Office", as the case may be, on Schedule
11.2, or such other office or offices as such Lender may from time to
time specify to the Company and the Agent.
Letters of Credit means any letters of credit (whether standby
letters of credit or commercial documentary letters of credit) Issued
by an Issuing Lender pursuant to Article III.
Leverage Ratio means
(a) for the Computation Period ending March 31, 1996,
the ratio of
(i) Funded Debt as of March 31, 1996
-18-
26
to
(ii) EBITDA for such Computation Period multiplied by
the quotient of (y) 365 divided by (z) the number of days in
such Computation Period;
(b) for the Computation Period ending June 30, 1996,
the ratio of
(i) Funded Debt as of June 30, 1996
to
(ii) EBITDA for such Computation Period multiplied by
the quotient of (y) 365 divided by (z) the number of days in
such Computation Period;
(c) for the Computation Period ending September 30,
1996, the ratio of
(i) Funded Debt as of September 30, 1996
to
(ii) EBITDA for such Computation Period multiplied by
the quotient of (y) 365 divided by (z) the number of days in
such Computation Period; and
(d) for each Computation Period ending on or after
December 31, 1996, the ratio of
(i) Funded Debt as of any date
to
(ii) EBITDA for such Computation Period most recently
ended on or before such date.
Lien means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, charge or deposit arrangement,
encumbrance, lien (statutory or other) or preferential arrangement of
any kind or nature whatsoever in respect of any property (including
those created by, arising under or evidenced by any conditional sale or
other title retention agreement, the interest of a lessor under a
capital lease, or any financing lease having substantially the same
economic effect as any of the foregoing, but not including the interest
of a lessor under an operating lease).
Loan means an extension of credit by a Lender to the Company
under Article II or Article III in the form of a Revolving Loan, Term
Loan or L/C Advance. Each Revolving Loan and each Term Loan may be
divided into tranches which
-19-
27
are a Base Rate Loan or an Offshore Rate Loan (each a "Type" of Loan).
Loan Documents means this Agreement, any Notes, the Fee
Letter, the L/C-Related Documents, the Guaranty, the Collateral
Documents and all other documents delivered to the Agent or any Lender
in connection herewith.
Margin Stock means "margin stock" as such term is defined in
Regulation G, T, U or X of the FRB.
Material Adverse Effect means (a) a material adverse change
in, or a material adverse effect upon, the operations, business,
properties, condition (financial or otherwise) or prospects of the
Company; (b) a material impairment of the ability of the Company to
perform under any Loan Document; or (c) a material adverse effect upon
the legality, validity, binding effect or enforceability against the
Company of any Loan Document.
MIS Expenditures means Capital Expenditures made by the
Company relating to the Company's new management information system;
provided, that such Capital Expenditures shall only be considered MIS
Expenditures to the extent that the aggregate amount of such
expenditures does not exceed $2,000,000.
Mortgage means a mortgage, leasehold mortgage, deed of trust
or similar document granting a Lien on real property in appropriate
form for filing or recording in the applicable jurisdiction and
otherwise reasonably satisfactory to the Agent.
Multiemployer Plan means a "multiemployer plan", within the
meaning of Section 4001(a)(3) of ERISA, with respect to which the
Company or any ERISA Affiliate may have any liability.
Net Cash Proceeds means
(a) with respect to the sale, transfer, or other
disposition by the Company or any Subsidiary of any
asset (including any stock of any Subsidiary), the
aggregate cash proceeds (including cash proceeds
received by way of deferred payment of principal
pursuant to a note, installment receivable or
otherwise, but only as and when received) received by
the Company or any Subsidiary pursuant to such sale,
transfer or other disposition, net of (i) the direct
costs relating to such sale, transfer or other
disposition (including, without limitation, sales
commissions and legal, accounting and investment
banking fees), (ii) taxes paid or payable as a result
thereof (after taking into account any available tax
-20-
28
credits or deductions and any tax sharing
arrangements), (iii) amounts required to be applied to
the repayment of any Indebtedness secured by a Lien on
the asset subject to such sale, transfer or other
disposition (other than the Loans) and (iv) any reserve
for adjustment in respect of the sale price of such
asset (until such amount is available to the Company or
the applicable Subsidiary); and
(b) with respect to any issuance of equity securities or Other
Debt, the aggregate cash proceeds received by the Company or
any Subsidiary pursuant to such issuance, net of the direct
costs relating to such issuance (including, without
limitation, sales and underwriter's commissions and legal,
accounting and investment banking fees).
Net Worth means the Company's consolidated stockholders'
equity plus all non-cash or non-recurring charges after the Closing
Date related to but not limited to the adoption of new accounting
policies and plant consolidations or restructurings to the extent such
charges were deducted in determining such consolidated stockholders
equity.
Non-Financial Standby Letter of Credit means any
Standby Letter of Credit that is not a Financial Standby
Letter of Credit.
Note means a promissory note executed by the Company in favor
of a Lender pursuant to subsection 2.2(b), in substantially the form of
Exhibit D.
Notice of Borrowing means a notice in substantially the form
of Exhibit A.
Notice of Conversion/Continuation means a notice in
substantially the form of Exhibit B.
Obligations means all advances, debts, liabilities,
obligations, covenants and duties arising under any Loan Document owing
by the Company to any Lender, the Agent, or any Indemnified Person,
whether direct or indirect (including those acquired by assignment),
absolute or contingent, due or to become due, or now existing or
hereafter arising.
Offshore Rate means, for any Interest Period, with respect to
Offshore Rate Loans comprising part of the same Borrowing, the rate of
interest per annum (rounded upward, if the resulting rate is not an
integral multiple of 1/16 of 1%, to the next 1/16th of 1%) determined
by the Agent as follows:
-21-
29
Offshore Rate = IBOR
------------------------------------
1.00 - Eurodollar Reserve Percentage
Where,
"Eurodollar Reserve Percentage" means for any day for any
Interest Period the maximum reserve percentage (expressed as a
decimal, rounded upward, if the resulting decimal is not an
integral multiple of 1/100 of 1%, to the next 1/100th of 1%)
in effect on such day applicable to any Lender under
regulations issued from time to time by the FRB for
determining the maximum reserve requirement (including any
emergency, supplemental or other marginal reserve requirement)
with respect to Eurocurrency funding (currently referred to as
"Eurocurrency liabilities"); and
"IBOR" means the rate of interest per annum determined by the
Agent as the rate at which Dollar deposits in the approximate
amount of BAI's Offshore Rate Loan for such Interest Period
would be offered by BofA's Grand Cayman Branch, Grand Cayman
B.W.I. (or such other office as may be designated for such
purpose by BofA), to major banks in the offshore dollar
interbank market at their request at approximately 11:00 a.m.
(New York City time) two Business Days prior to the
commencement of such Interest Period.
The Offshore Rate shall be adjusted automatically as to all
Offshore Rate Loans then outstanding as of the effective date of any
change in the Eurodollar Reserve Percentage.
Offshore Rate Loan means a Loan that bears interest based on
the Offshore Rate.
Organization Documents means, for any corporation, the
certificate or articles of incorporation, the bylaws, any certificate
of determination or instrument relating to the rights of preferred
shareholders of such corporation, any shareholder rights agreement, and
all applicable resolutions of the board of directors (or any committee
thereof) of such corporation.
Other Debt means debt securities of the Company and its
Subsidiaries, other than as permitted by Section 8.5.
Other Taxes means any present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies
which arise from any payment made hereunder or from the execution,
delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document.
-22-
30
Parent means Fiberite Holdings, Inc., a Delaware
corporation.
Parent Pledge Agreement - see subsection 5.1(k).
Participant -- see subsection 11.8(c).
Patent Security Agreement -- see subsection 5.1(i).
PBGC means the Pension Benefit Guaranty Corporation, or any
Governmental Authority succeeding to any of its principal functions
under ERISA.
Pension Plan means a pension plan (as defined in Section 3(2)
of ERISA) subject to Title IV of ERISA with respect to which the
Company or any ERISA Affiliate may have any liability.
Permitted Liens -- see Section 8.1.
Permitted Swap Obligations means all obligations (contingent
or otherwise) of the Company or any Subsidiary existing or arising
under Swap Contracts, provided that each of the following criteria is
satisfied: (a) such obligations are (or were) entered into by such
Person in the ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments or assets
held or reasonably anticipated by such Person, or changes in the value
of securities issued by such Person in conjunction with a securities
repurchase program not otherwise prohibited hereunder, and not for
purposes of speculation or taking a "market view;" and (b) such Swap
Contracts do not contain (i) any provision ("walk-away" provision)
exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party, or (ii)
any provision creating or permitting the declaration of an event of
default, termination event or similar event upon the occurrence of an
Event of Default hereunder (other than an Event of Default under
subsection 9.1(a).
Person means an individual, partnership, corporation, limited
liability company, business trust, joint stock company, trust,
unincorporated association, joint venture or Governmental Authority.
Plan means an employee benefit plan (as defined in Section
3(3) of ERISA) which the Company sponsors or maintains or to which the
Company makes, is making, or is obligated to make contributions and
includes any Pension Plan.
Pledge Agreement means the Company Pledge Agreement or
the Parent Pledge Agreement.
-23-
31
Primary Syndication Date means the first date upon which BAI
assigns any of its commitments pursuant to Section 11.8.
Public Offering means the offering of shares of stock or
Indebtedness registered under the Securities Act of 1933.
Purchase means the purchase by the Company of ICI Composites,
Inc. and the assets and liabilities of Fiberite Europe GmbH pursuant to
the Purchase Agreements.
Purchase Agreement means the U.S. Purchase Agreement or
the German Purchase Agreement.
Purchase Agreement Assignment means a Purchase Agreement
Assignment in the form of Exhibit K, with appropriate insertions.
Replacement Lender -- see Section 4.7.
Reportable Event means, any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, other than any such
event for which the 30-day notice requirement under ERISA has been
waived in regulations issued by the PBGC or administrative
pronouncements.
Required Lenders means, at any time, Lenders having an
aggregate Total Percentage of 60% or more.
Required Revolving Lenders means, at any time, Lenders having
an aggregate Revolving Percentage of 60% or more.
Requirement of Law means, as to any Person, any law (statutory
or common), treaty, rule or regulation or determination of an
arbitrator or of a Governmental Authority, in each case applicable to
or binding upon such Person or any of its property or to which such
Person or any of its property is subject.
Responsible Officer means the chief executive officer or the
president of the Company, or any other officer having substantially the
same authority and responsibility; or, with respect to compliance with
financial covenants, the chief financial officer or the treasurer of
the Company, or any other officer having substantially the same
authority and responsibility.
Revolving Commitment means, as to any Lender, the commitment
of such Lender to make Revolving Loans pursuant to subsection 2.1(c).
The initial amount of each Lender's Revolving Commitment is set forth
on Schedule 1.1.
Revolving Loan -- see Section 2.1.
-24-
32
Revolving Percentage means, as to any Lender, the percentage
which (a) the amount of such Lender's Revolving Commitment is of (b)
the aggregate amount of all of the Lenders' Revolving Commitments.
Revolving Termination Date means the earlier to occur of:
(a) December 31, 2000; and
(b) the date on which the Revolving Commitment
terminates in accordance with the provisions of
this Agreement.
SEC means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.
Sellers means ICI American Holdings, Inc. and Deutsche
ICI GmbH.
Securities Purchase Agreement means the Securities Purchase
Agreement dated as of the Closing Date, among Parent and the Initial
Parent Stockholders named therein.
Security Agreement -- see subsection 5.1(g).
Shareholder Agreement means the Shareholder Agreement dated as
of the Closing Date, among the Company, DLJMB, Carlisle and the other
Initial Parent Stockholders.
Standby Letter of Credit means any Letter of Credit that is
not a Commercial Letter of Credit.
Subordinated Notes means the subordinated notes of the Parent
issued pursuant to the Securities Purchase Agreement.
Subsidiary of a Person means any corporation, association,
partnership, limited liability company, joint venture or other business
entity of which more than 50% of the voting stock, membership interests
or other equity interests is owned or controlled directly or indirectly
by such Person, or one or more of the Subsidiaries of such Person, or a
combination thereof. Unless the context otherwise clearly requires,
references herein to a "Subsidiary" refer to a Subsidiary of the
Company.
Surety Instruments means all letters of credit (including
standby and commercial), banker's acceptances, bank guaranties, surety
bonds and similar instruments.
Swap Contract means any agreement, whether or not in writing,
relating to any transaction that is a rate swap, basis swap, forward
rate transaction, commodity swap,
-25-
33
commodity option, equity or equity index swap or option, bond, note or
xxxx option, interest rate option, forward foreign exchange
transaction, cap, collar or floor transaction, currency swap,
cross-currency rate swap, swaption, currency option or any other,
similar transaction (including any option to enter into any of the
foregoing) or any combination of the foregoing, and, unless the context
otherwise clearly requires, any master agreement relating to or
governing any or all of the foregoing.
Swap Termination Value means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally
enforceable netting agreement relating to such Swap Contracts, (a) for
any date on or after the date such Swap Contracts have been closed out
and termination value(s) determined in accordance therewith, such
termination value(s), and (b) for any date prior to the date referenced
in clause (a) the amount(s) determined as the xxxx-to-market value(s)
for such Swap Contracts, as determined based upon one or more
mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts (which may include any
Lender).
Tax Sharing Agreement means the Tax Sharing Agreement dated as
of the Closing Date, between the Company and the Parent as amended from
time to time pursuant to Section 8.19.
Taxes means any and all present or future taxes, levies,
imposts, deductions, charges or withholdings, and all liabilities with
respect thereto, excluding, in the case of each Lender and the Agent,
such taxes (including income taxes or franchise taxes) as are imposed
on or measured by such Lender's or the Agent's, as the case may be, net
income by the jurisdiction (or any political subdivision thereof) under
the laws of which such Lender or the Agent, as the case may be, is
organized, maintains a lending office or is carrying on business.
Term A Commitment means, as to any Lender, the commitment of
such Lender to make a Term A Loan pursuant to subsection 2.1(a). The
amount of each Lender's Term A Commitment is set forth on Schedule 1.1.
Term A Loan -- see subsection 2.1(a).
Term A Percentage means, as to any Lender, the percentage
which (a) the Term A Commitment of such Lender (or, after the making of
the Term A Loans, the principal amount of such Lender's Term A Loan) is
of (b) the aggregate amount of Term A Commitments (or after the making
of the Term A Loans, the aggregate principal amount of all Term A
Loans). The initial amount of the Term A Loan Percentage
-26-
34
for each Lender is set forth such Lender's name on Schedule 1.1.
Term B Commitment means, as to any Bank, the commitment of
such Lender to make a Term B Loan pursuant to subsection 2.1(b). The
amount of each Bank's Term B Commitment is set forth on Schedule 1.1.
Term B Loan -- see subsection 2.1(b).
Term B Percentage means, as to any Lender, the percentage
which (a) the Term B Commitment of such Lender (or, after the making of
the Term B Loans, the principal amount of such Lender's Term B Loan) is
of (b) the aggregate amount of Term B Commitments (or after the making
of the Term B Loans, the aggregate principal amount of all Term B
Loans). The initial amount of the Term B Loan Percentage for each
Lender is set forth such Lender's name on Schedule 1.1.
Term Loan means a Term A Loan or a Term B Loan.
Total Percentage means, as to any Lender the percentage which
(a) the aggregate amount of such (i) Lender's Revolving Commitment plus
(ii) such Lender's Term A Commitment (or, after the making of the Term
A Loans, the outstanding principal amount of such Lender's Term A
Loans) plus (iii) such Lender's Term B Commitment (or, after the making
of the Term B Loans, the outstanding principal amount of such Lender's
Term B Loans) is of (b) the aggregate amount of (i) the Revolving
Commitments of all Lenders plus (ii) the Term A Commitments of all
Lenders (or, after the making of the Term A Loans, the outstanding
principal amount of all Term A Loans) plus (iii) the Term B Commitments
of all Lenders (or, after the making of the Term B Loans, the
outstanding principal amount of all Term B Loans); provided that after
the Revolving Commitments have been terminated, "Total Percentage"
shall mean as to any Lender the percentage which the aggregate
principal amount of such Lender's Loans is of the aggregate principal
amount of all Loans. The initial Total Percentage for each Lender is
set forth opposite such Lender's name on Schedule 1.1.
Trademark Security Agreement -- see subsection 5.1(i).
Transition Services Agreement means the U.S. Transition
Services Agreement or the German Transition Services
Agreement.
Type has the meaning specified in the definition of
"Loan."
Unfunded Pension Liability means the excess of a Pension
Plan's benefit liabilities under Section 4001(a)(16)
-27-
35
of ERISA, over the current value of such Pension Plan's assets,
determined in accordance with the assumptions used for funding such
Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
United States and U.S. each means the United States of
America.
Unmatured Event of Default means any event or circumstance
which, with the giving of notice, the lapse of time, or both, would (if
not cured or otherwise remedied during such time) constitute an Event
of Default.
U.S. Purchase Agreement means the Purchase Agreement dated as
of the Closing Date, between ICI American Holdings, Inc., as seller,
the Company, as buyer, and the Parent, as guarantor as amended from
time to time pursuant to Section 8.19.
U.S. Transition Services Agreement means the Transition
Services Agreement dated as of the Closing Date, between ICI
Composites, Inc. and ICI American Holdings, Inc. as amended
from time to time pursuant to Section 8.19.
1.2 Other Interpretive Provisions.
(a) The meanings of defined terms are equally applicable to
the singular and plural forms of the defined terms.
(b) The words "hereof", "herein", "hereunder" and similar
words refer to this Agreement as a whole and not to any particular provision of
this Agreement; and subsection, Section, Schedule and Exhibit references are to
this Agreement unless otherwise specified.
(c) (i) The term "documents" includes any and all instruments,
documents, agreements, certificates, indentures, notices and other
writings, however evidenced.
(ii) The term "including" is not limiting and
means "including without limitation."
(iii) In the computation of periods of time from a
specified date to a later specified date, the word "from" means "from
and including"; the words "to" and "until" each mean "to but
excluding"; and the word "through" means "to and including."
(d) Unless otherwise expressly provided herein, (i) references
to agreements (including this Agreement) and other contractual instruments shall
be deemed to include all subsequent amendments and other modifications thereto,
but only to the extent such amendments and other modifications are not
prohibited by the terms of any Loan Document, and (ii) references to any
-28-
36
statute or regulation are to be construed as including all statutory and
regulatory provisions consolidating, amending, replacing, supplementing or
interpreting the statute or regulation.
(e) The captions and headings of this Agreement are for
convenience of reference only and shall not affect the interpretation of this
Agreement.
(f) This Agreement and the other Loan Documents may use
several different limitations, tests or measurements to regulate the same or
similar matters. All such limitations, tests and measurements are cumulative and
shall each be performed in accordance with their terms.
(g) This Agreement and the other Loan Documents are the result
of negotiations among and have been reviewed by counsel to the Agent, the
Company and the other parties, and are the products of all parties. Accordingly,
they shall not be construed against the Lenders or the Agent merely because of
the Lenders' or the Agent's involvement in their preparation.
1.3 Accounting Principles.
(a) Unless the context otherwise clearly requires, all
accounting terms not expressly defined herein shall be construed, and all
financial computations required under this Agreement shall be made, in
accordance with GAAP, consistently applied; provided that if the Company
notifies the Agent that the Company wishes to amend any covenant in Article VIII
to eliminate the effect of any change in GAAP on the operation of such covenant
(or if the Agent notifies the Company that the Required Lenders wish to amend
Article VIII for such purpose), then the Company's compliance with such covenant
shall be determined on the basis of GAAP in effect immediately before the
relevant change in GAAP became effective, until either such notice is withdrawn
or such covenant is amended in a manner satisfactory to the Company and the
Required Lenders.
(b) References herein to "fiscal year" and "fiscal quarter"
refer to such fiscal periods of the Company.
ARTICLE II
THE CREDITS
2.1 Amounts and Terms of Commitments. (a) The Term A Credit. Each
Lender severally agrees, on the terms and conditions set forth herein, to make a
single loan to the Company (each such loan, a "Term A Loan") on the Closing Date
in an amount not to exceed such Lender's Term A Percentage of $50,000,000.
Amounts borrowed as Term A Loans which are repaid or prepaid by the Company may
not be reborrowed. The Term A
-29-
37
Commitments shall expire concurrently with the making of the Term A Loans on the
Closing Date.
(b) The Term B Credit. Each Lender severally agrees, on the
terms and conditions set forth herein, to make a single loan to the Company
(each such loan, a "Term B Loan") on the Closing Date in an amount not to exceed
such Lender's Term B Percentage of $25,000,000. Amounts borrowed as Term B Loans
which are repaid or prepaid by the Company may not be reborrowed. The Term B
Commitments shall expire concurrently with the making of the Term B Loans on the
Closing Date.
(c) The Revolving Credit. Each Lender severally agrees, on the
terms and conditions set forth herein, to make loans to the Company (each such
loan, a "Revolving Loan"), from time to time on any Business Day during the
period from the Closing Date to the Revolving Termination Date, in an aggregate
amount not to exceed at any time outstanding such Lender's Revolving Percentage
of $25,000,000; provided that, after giving effect to any Borrowing of Revolving
Loans, the aggregate amount of all Revolving Loans plus the Effective Amount of
all L/C Obligations shall not exceed the Revolving Commitment; and provided,
further, the amount of all Revolving Loans made on the Closing Date shall not
exceed $19,000,000. Within the foregoing limits, and subject to the other terms
and conditions hereof, the Company may borrow under this subsection 2.1(c),
prepay under Section 2.6 and reborrow under this subsection 2.1(c).
2.2 Loan Accounts. (a) The Loans made by each Lender and the Letters of
Credit Issued by each Issuing Lender shall be evidenced by one or more accounts
or records maintained by such Lender or Issuing Lender, as the case may be, in
the ordinary course of business. The accounts or records maintained by the
Agent, each Issuing Lender and each Lender shall be conclusive (absent manifest
error) as to the amount of the Loans made by the Lenders to the Company and the
Letters of Credit Issued for the account of the Company, and the interest and
payments thereon. Any failure so to record or any error in doing so shall not,
however, limit or otherwise affect the obligation of the Company hereunder to
pay any amount owing with respect to any Loan or any Letter of Credit.
(b) Upon the request of any Lender made through the Agent, the
Loans made by such Lender may be evidenced by one or more Notes, instead of loan
accounts. Each such Lender shall endorse on the schedules annexed to its Note(s)
the date, amount and maturity of each Loan made by it and the amount of each
payment of principal made by the Company with respect thereto. Each such Lender
is irrevocably authorized by the Company to endorse its Note(s) and each
Lender's record shall be rebuttable presumptive evidence of the matters set
forth therein; provided, however, that the failure of a Lender to make, or an
error in making, a notation thereon with respect to any Loan shall not
-30-
38
limit or otherwise affect the obligations of the Company hereunder or under any
Note to such Lender.
2.3 Procedure for Borrowing. (a) Each Borrowing shall be made upon the
Company's irrevocable written notice delivered to the Agent in the form of a
Notice of Borrowing (which notice must be received by the Agent (i) prior to
8:30 a.m. (San Francisco time) three Business Days prior to the requested
Borrowing Date, in the case of Offshore Rate Loans; and (ii) prior to 8:30 a.m.
(San Francisco time) on the requested Borrowing Date, in the case of Base Rate
Loans), specifying:
(A) the amount of the Borrowing, which shall
be in an amount of $500,000 or a higher integral multiple of
$100,000;
(B) the requested Borrowing Date, which
shall be a Business Day;
(C) the Type of Loans comprising the
Borrowing; and
(D) in the case of Offshore Rate Loans, the
duration of the Interest Period applicable to such Loans
included in such notice.
(b) The Agent will promptly notify each Lender of its receipt
of any Notice of Borrowing and of the amount of such Lender's share of such
Borrowing based upon such Lender's Revolving Percentage, Term A Percentage or
Term B Percentage, as applicable.
(c) Each Lender will make the amount of its share of each
Borrowing available to the Agent for the account of the Company at the Agent's
Payment Office by 11:00 a.m. (San Francisco time) on the Borrowing Date
requested by the Company in funds immediately available to the Agent. The
proceeds of all Loans will then be made available to the Company by the Agent at
such office by crediting the account of the Company on the books
of BAI with the aggregate of the amounts made available to the Agent by the
Lenders and in like funds as received by the Agent.
(d) After giving effect to any Borrowing, there may not be
more than seven different Interest Periods in effect.
2.4 Conversion and Continuation Elections. (a) The Company
may, upon irrevocable written notice to the Agent in accordance
with subsection 2.4(b):
(i) elect to convert, on any Business Day, any Base
Rate Loans (in an aggregate amount of $500,000 or a higher integral
multiple of $100,000) into Offshore Rate Loans;
-31-
39
(ii) elect to convert, on the last day of the
applicable Interest Period, any Offshore Rate Loans (or any part
thereof in an aggregate amount of $500,000 or a higher integral
multiple of $100,000) into Base Rate Loans; or
(iii) elect to continue, as of the last day of the
applicable Interest Period, any Offshore Rate Loans having Interest
Periods expiring on such day (or any part thereof in an aggregate
amount of $500,000 or a higher integral multiple of $100,000);
provided that if at any time the aggregate amount of Offshore Rate Loans in
respect of any Borrowing shall have been reduced, by payment, prepayment, or
conversion of part thereof, to be less than $500,000, such Offshore Rate Loans
shall automatically convert into Base Rate Loans.
(b) The Company shall deliver a Notice of
Conversion/Continuation to be received by the Agent not later than (i) 8:30 a.m.
(San Francisco time) at least three Business Days in advance of the Conversion/
Continuation Date, if the Loans are to be converted into or continued as
Offshore Rate Loans; and (ii) not later than 8:30 a.m. (San Francisco time) on
the Conversion/Continuation Date, if the Loans are to be converted into Base
Rate Loans, specifying:
(A) the proposed Conversion/Continuation
Date;
(B) the aggregate amount of Loans to be
converted or continued;
(C) the Type of Loans resulting from the
proposed conversion or continuation; and
(D) in the case of conversions into Offshore
Rate Loans, the duration of the requested Interest Period.
(c) If upon the expiration of any Interest Period applicable
to Offshore Rate Loans, the Company has failed to select timely a new Interest
Period to be applicable to such Offshore Rate Loans, the Company shall be deemed
to have elected to convert such Offshore Rate Loans into Base Rate Loans
effective as of the expiration date of such Interest Period.
(d) The Agent will promptly notify each Lender of its receipt
of a Notice of Conversion/Continuation or, if no timely notice is provided by
the Company, the Agent will promptly notify each Lender of the details of any
automatic conversion. All conversions and continuations shall be made ratably
according to the respective outstanding principal amounts of the Loans with
respect to which the notice was given held by each Lender.
-32-
40
(e) Unless the Required Lenders otherwise agree, during the
existence of an Event of Default or Unmatured Event of Default, the Company may
not elect to have a Loan converted into or continued as an Offshore Rate Loan.
(f) After giving effect to any conversion or continuation of
Loans, there may not be more than seven different Interest Periods in effect.
2.5 Voluntary Termination or Reduction of Revolving Commitments. The
Company may, upon not less than three Business Days' prior notice to the Agent,
terminate the Revolving Commitment, or permanently reduce the Revolving
Commitment by an aggregate amount of $1,000,000 or a higher integral multiple of
$500,000; unless, after giving effect thereto and to any prepayments of Loans
made on the effective date thereof, the aggregate principal amount of all
Revolving Loans plus the Effective Amount of all L/C Obligations would exceed
the amount of the Revolving Commitment then in effect. Once reduced in
accordance with this Section, the Revolving Commitment may not be increased. Any
reduction of the Revolving Commitment shall be applied to each Lender according
to its Revolving Percentage.
2.6 Optional Prepayments.
(a) Subject to Section 4.4, (i) the Company may, from time to
time, upon irrevocable notice to the Agent (which notice must be
received by 8:30 a.m. (San Francisco time) on the requested day of
prepayment in the case of Base Rate Loans and 8:30 a.m. (San Francisco
time) three days prior to the date of prepayment in the case of Offshore
Rate Loans), ratably prepay any Borrowing of Revolving Loans in whole or
in part, in an aggregate amount of $500,000 or a higher integral
multiple of $100,000; and (ii) the Company may, from time to time, upon
not less than three Business Days' irrevocable notice to the Agent,
prepay any Borrowing of Term Loans in whole or in part, in an aggregate
amount of $1,000,000 or a higher integral multiple of $100,000.
(b) Each notice of prepayment shall specify the date and amount
of such prepayment and the Loans to be prepaid. The Agent will promptly
notify each Lender of its receipt of any such notice and of such
Lender's share of such prepayment based upon such Lender's Revolving
Percentage, in the case of a prepayment of Revolving Loans, Term A
Percentage, in the case of a prepayment of Term A Loans, or Term B
Percentage in the case of a prepayment of Term B Loans. If any such
notice is given by the Company, the Company shall make such prepayment
and the payment amount specified in such notice shall be due and payable
on the date specified therein, together with accrued interest to such
date on the amount prepaid and any amounts required pursuant to Section
4.4. Each prepayment of Revolving Loans shall be applied to each
Lender's Revolving Loans according to such Lender's Revolving
-33-
41
Percentage. Each prepayment of Term Loans shall be applied pro rata to
the unpaid installments of the Term Loans; provided, that the Company
may, by giving written notice to the Agent concurrently with any notice
of prepayment, specify that any prepayment of Term Loans may be applied
pro rata to the remaining unpaid installments of the Term A Loans.
2.7 Mandatory Prepayments of Loans. So long as any Term Loan is
outstanding, the Company (or, in the case of subsection (c), if the Agent is
holding the proceeds of insurance as additional Collateral pursuant to the terms
of the Security Agreement, the Agent upon the Company's instruction) shall make
a prepayment of the Term Loans at the following times and in the following
amounts:
(a) Within 30 days after any sale, transfer or other
disposition by the Company or any Subsidiary of any asset
outside the ordinary course of its business to a Person other
than the Company or a Subsidiary, in an amount equal to 100% of
the Net Cash Proceeds of such sale, transfer or other
disposition.
(b) Within 30 days after any sale, transfer or other
disposition (including by way of merger or consolidation) by the
Company or any Subsidiary of all of the capital stock of any of
the Company's operating Subsidiaries to a Person other than the
Company or a Subsidiary, in an amount equal to 100% of the Net
Cash Proceeds of such sale.
(c) Within 30 days after the receipt of any insurance
proceeds (or other similar recoveries) by the Company or any
Subsidiary or by the Agent (to the extent the Agent is holding
the insurance proceeds as additional Collateral pursuant to
Section 6 of the Security Agreement) from any casualty loss
incurred by the Company or any Subsidiary, in an amount equal to
100% of such insurance proceeds (or other similar recoveries)
net of any collection expenses; provided that no such prepayment
shall be required to the extent such proceeds are used by the
Company for the financing of the replacement, substitution or
restoration of the assets sustaining such casualty loss.
(d) Concurrently with the receipt of any Net Cash
Proceeds from any issuance of equity securities of the Company
(including a Public Offering, but excluding the issuance of
shares of common stock of the Company pursuant to any employee
or director stock option program, benefit plan or compensation
program), in an amount equal to 50% of such Net Cash Proceeds.
(e) Concurrently with the receipt of any Net Cash
Proceeds from the issuance of any Other Debt of the
-34-
42
Company or any Subsidiary (including a Public Offering), in an
amount equal to 100% of such Net Cash Proceeds.
(f) Within 90 days after the end of each fiscal year,
beginning with the 1996 fiscal year, in an amount equal to 75%
of Excess Cash Flow for (i) in the case of the 1996 fiscal year,
the period beginning on the Closing Date and ending on December
31, 1996 and (ii) in the case of any other fiscal year, such
fiscal year (rounded to the nearest, or if there is no nearest
the next highest, integral multiple of $10,000); provided that
if the Leverage Ratio as of the end of such fiscal year is less
than 3.0: 1:00, then the amount of the required prepayment shall
be 50% of Excess Cash Flow.
All prepayments of Term Loans pursuant to this Section 2.7 shall be applied to
the remaining installments thereof pro rata; provided that if the Lenders
holding 60% of the aggregate principal amount of the Term B Loans so request, by
notice to the Agent not later than five Business Days prior to the date upon
which such prepayment is due, the portion of any prepayment which would have
been applied to the Term B Loans shall be applied pro rata to the remaining
installments of the Term A Loans of all Lenders (it being understood that if the
Term A Lenders incur additional funding losses pursuant to Section 4.4 as a
result of the reallocation of such prepayment, the Company shall only be
responsible for the portion of such additional funding losses which would have
been incurred by the Term B Lenders if such payment had been applied to the Term
B Loans).
2.8 Repayment. (a) The Term A Credit. The Company shall repay the Term A
Loans in quarterly installments on the last day of each calendar quarter,
commencing on March 31, 1996 in the amount set forth opposite the period in
which such quarterly date occurs:
Period Amount
------ ------
March 31, 1996 through December 31, 1997 $2,000,000
January 1, 1998 through December 31, 1998 2,500,000
January 1, 1999 through December 31, 2000 3,000,000
(b) The Term B Credit. The Company shall repay the Term B Loans
in quarterly installments on the last day of each calendar quarter, commencing
on March 31, 1996 in the amount set forth opposite the period in which such
quarterly date occurs:
Period Amount
------ ------
March 31, 1996 through December 31, 1999 $ 125,000
January 1, 2000 through December 31, 2000 250,000
January 1, 2001 through December 31, 2001 5,500,000
-35-
43
(c) The Revolving Credit. The Company shall pay to the Agent,
for the account of the Lenders, on the Revolving Termination Date the aggregate
principal amount of all Revolving Loans outstanding on such date.
2.9 Interest. (a) Each Revolving Loan and Term Loan shall bear interest
on the outstanding principal amount thereof from the applicable Borrowing Date
at a rate per annum equal to the Offshore Rate or the Base Rate, as the case may
be (and subject to the Company's right to convert to the other Type of Loans
under Section 2.4), plus the Applicable Offshore Rate Margin or Applicable Base
Rate Margin, as the case may be.
(b) Interest on each Loan shall be paid in arrears on each
Interest Payment Date therefor. Interest shall also be paid on the date of any
prepayment of Loans under Section 2.6 or 2.7 for the portion of the Loans so
prepaid and upon payment (including prepayment) in full thereof.
(c) Notwithstanding subsection (a) of this Section, during the
existence of any Event of Default under subsection 9.1(a), (f) or (g), and, at
the election of the Required Lenders, during the existence of any other Event of
Default, the Company shall pay interest (after as well as before entry of
judgment thereon to the extent permitted by law) on the principal amount of all
outstanding Loans and, to the extent permitted by applicable law, on any other
amount payable hereunder or under any other Loan Document, at a rate per annum
equal to the rate otherwise applicable thereto pursuant to the terms hereof or
such other Loan Document (or, if no such rate is specified, the Base Rate plus
the Applicable Base Rate Margin then in effect for Revolving Loans) plus 2%. All
such interest shall be payable on demand.
(d) Anything herein to the contrary notwithstanding, the
obligations of the Company to any Lender hereunder shall be subject to the
limitation that payments of interest shall not be required for any period for
which interest is computed hereunder to the extent (but only to the extent) that
contracting for or receiving such payment by such Lender would be contrary to
the provisions of any law applicable to such Lender limiting the highest rate of
interest that may be lawfully contracted for, charged or received by such
Lender, and in such event the Company shall pay such Lender interest at the
highest rate permitted by applicable law.
2.10 Fees. In addition to certain fees described in Section
3.8:
(a) Arranger and Agency Fees. The Company shall pay an
arrangement fee to the Arranger for the Arranger's own account and agency fees
to the Agent for the Agent's own account, in each case as required by the letter
agreement ("Fee Letter") between the Company, the Arranger and the Agent dated
August 14, 1995.
-36-
44
(b) Commitment Fees. The Company shall pay to the Agent for the
account of each Lender a commitment fee at the rate of 0.50% per annum on the
average daily unused portion of such Lender's Revolving Percentage of the
Revolving Commitment, computed on a quarterly basis in arrears on the last
Business Day of each calendar quarter based upon the daily utilization for that
quarter as calculated by the Agent. For purposes of calculating utilization
under this subsection, the Revolving Commitment shall be deemed used to the
extent of the aggregate principal amount of all Revolving Loans then outstanding
plus the Effective Amount of all L/C Obligations then outstanding. Such
commitment fee shall accrue from the Closing Date to the Revolving Termination
Date and shall be due and payable quarterly in arrears on the last Business Day
of each calendar quarter, with the final payment to be made on the Revolving
Termination Date. The commitment fees provided in this subsection shall accrue
at all times after the Closing Date, including at any time during which one or
more conditions in Article V are not met.
2.11 Computation of Fees and Interest. (a) All computations of interest
and fees shall be made on the basis of a 360-day year and actual days elapsed.
Interest and fees shall accrue during each period during which interest or such
fees are computed from the first day thereof to the last day thereof.
(b) Each determination of an interest rate by the Agent shall be
conclusive and binding on the Company and the Lenders in the absence of manifest
error. The Agent will, at the request of the Company or any Lender, deliver to
the Company or such Lender, as the case may be, a statement showing the
quotations used by the Agent in determining any interest rate and the resulting
interest rate.
2.12 Payments by the Company. (a) All payments to be made by the
Company shall be made without set-off, recoupment or counterclaim. Except as
otherwise expressly provided herein, all payments by the Company shall be made
to the Agent for the account of the Lenders at the Agent's Payment Office, and
shall be made in dollars and in immediately available funds, no later than 11:00
a.m. (San Francisco time) on the date specified herein. Except as expressly
provided herein, the Agent will promptly distribute, in like funds as received,
to each Lender its Revolving Percentage of any portion of such payment related
to the Revolving Loans, its Term A Percentage of any portion of such payment
relating to the Term Loans and its Term B Percentage of any portion of such
payment relating to the Term B Loans. Any payment received by the Agent later
than 11:00 a.m. (San Francisco time) shall be deemed to have been received on
the following Business Day and any applicable interest or fee shall continue to
accrue.
(b) Whenever any payment is due on a day other than a Business
Day, such payment shall be made on the following Business Day (unless such
following Business Day is the first
-37-
45
Business Day of a calendar month, in which case such payment shall be made on
the preceding Business Day), and such extension of time shall in such case be
included in the computation of interest or fees, as the case may be.
(c) Unless the Agent receives notice from the Company prior to
the date on which any payment is due to the Lenders that the Company will not
make such payment in full as and when required, the Agent may assume that the
Company has made such payment in full to the Agent on such date in immediately
available funds and the Agent may (but shall not be so required), in reliance
upon such assumption, distribute to each Lender on such due date an amount equal
to the amount then due such Lender. If and to the extent the Company has not
made such payment in full to the Agent, each Lender shall repay to the Agent on
demand such amount distributed to such Lender, together with interest thereon at
the Federal Funds Rate for each day from the date such amount is distributed to
such Lender until the date repaid.
2.13 Payments by the Lenders to the Agent. (a) Unless the Agent receives
notice from a Lender on or prior to the Closing Date or, with respect to any
Borrowing after the Closing Date, at least one Business Day prior to the date of
such Borrowing, that such Lender will not make available as and when required
hereunder to the Agent for the account of the Company the amount of such
Lender's Revolving Percentage, Term A Percentage or Term B Percentage, as
applicable, of such Borrowing, the Agent may assume that each Lender has made
such amount available to the Agent in immediately available funds on the
Borrowing Date and the Agent may (but shall not be required), in reliance upon
such assumption, make available to the Company on such date a corresponding
amount. If and to the extent any Lender shall not have made its full amount
available to the Agent in immediately available funds and the Agent in such
circumstances has made available to the Company such amount, such Lender shall
on the Business Day following such Borrowing Date make such amount available to
the Agent, together with interest at the Federal Funds Rate for each day during
such period. A notice of the Agent submitted to any Lender with respect to
amounts owing under this subsection (a) shall be conclusive, absent manifest
error. If such amount is so made available, such payment to the Agent shall
constitute such Lender's Loan on the date of Borrowing for all purposes of this
Agreement. If such amount is not made available to the Agent on the Business Day
following the Borrowing Date, the Agent will notify the Company of such failure
to fund and, upon demand by the Agent, the Company shall pay such amount to the
Agent for the Agent's account, together with interest thereon for each day
elapsed since the date of such Borrowing, at a rate per annum equal to the
interest rate applicable at the time to the Loans comprising such Borrowing.
(b) The failure of any Lender to make any Loan on any Borrowing
Date shall not relieve any other Lender of any obligation hereunder to make a
Loan on such Borrowing Date, but
-38-
46
no Lender shall be responsible for the failure of any other Lender to make the
Loan to be made by such other Lender on any Borrowing Date.
2.14 Sharing of Payments, Etc. If, other than as expressly provided
elsewhere herein, any Lender shall obtain on account of the Loans made by it any
payment (whether voluntary, involuntary, through the exercise of any right of
set-off, or otherwise) in excess of its ratable share of such payment
(determined in accordance with the provisions of this Agreement), such Lender
shall immediately (a) notify the Agent of such fact, and (b) purchase from the
other Lenders such participations in the Loans made by them as shall be
necessary to cause such purchasing Lender to share the excess payment pro rata
with each other Lender; provided, however, that if all or any portion of such
excess payment is thereafter recovered from the purchasing Lender, such purchase
shall to that extent be rescinded and each other Lender shall repay to the
purchasing Lender the purchase price paid therefor, together with an amount
equal to such paying Lender's ratable share (according to the proportion of (i)
the amount of such paying Lender's required repayment to (ii) the total amount
so recovered from the purchasing Lender) of any interest or other amount paid or
payable by the purchasing Lender in respect of the total amount so recovered.
The Company agrees that any Lender so purchasing a participation from another
Lender may, to the fullest extent permitted by law, exercise all its rights of
payment (including the right of set-off, but subject to Section 11.10) with
respect to such participation as fully as if such Lender were the direct
creditor of the Company in the amount of such participation. The Agent will keep
records (which shall be conclusive and binding in the absence of manifest error)
of participations purchased under this Section and will in each case notify the
Lenders following any such purchases or repayments.
ARTICLE III
THE LETTERS OF CREDIT
3.1 The Letter of Credit Subfacility. (a) On the terms and conditions
set forth herein (i) each Issuing Lender agrees, (A) from time to time on any
Business Day during the period from the Closing Date to the Revolving
Termination Date to issue Letters of Credit for the account of the Company, and
to amend or renew Letters of Credit previously issued by it, in accordance with
subsections 3.2(c) and 3.2(d), and (B) to honor properly drawn drafts under the
Letters of Credit issued by it; and (ii) the Lenders severally agree to
participate in Letters of Credit Issued for the account of the Company; provided
that no Issuing Lender shall be obligated to Issue, and no Lender shall be
obligated to participate in, any Letter of Credit if as of the date of Issuance
of such Letter of Credit (the "Issuance Date") (1) the Effective Amount of all
L/C Obligations plus the aggregate amount of all Revolving Loans exceeds the
Revolving
-39-
47
Commitment, (2) the Effective Amount of all L/C Obligations exceeds the L/C
Commitment or (3) the participation of any Lender in the Effective Amount of all
L/C Obligations plus the outstanding principal amount of the Revolving Loans of
such Lender shall exceed such Lender's Revolving Commitment. Within the
foregoing limits, and subject to the other terms and conditions hereof, the
Company's ability to obtain Letters of Credit shall be fully revolving, and,
accordingly, the Company may, during the foregoing period, obtain Letters of
Credit to replace Letters of Credit which have expired or which have been drawn
upon and reimbursed.
(b) No Issuing Lender shall be under any obligation to Issue any
Letter of Credit if:
(i) any order, judgment or decree of any Governmental
Authority or arbitrator shall by its terms purport to enjoin or restrain
such Issuing Lender from Issuing such Letter of Credit, or any
Requirement of Law applicable to such Issuing Lender or any request or
directive (whether or not having the force of law) from any Governmental
Authority with jurisdiction over such Issuing Lender shall prohibit, or
request that such Issuing Lender refrain from, the Issuance of letters
of credit generally or such Letter of Credit in particular or shall
impose upon such Issuing Lender with respect to such Letter of Credit
any restriction, reserve or capital requirement (for which such Issuing
Lender is not otherwise compensated hereunder) not in effect on the
Closing Date, or shall impose upon such Issuing Lender any unreimbursed
loss, cost or expense which was not applicable on the Closing Date and
which such Issuing Lender in good xxxxx xxxxx material to it;
(ii) such Issuing Lender has received written notice
from any Lender, the Agent or the Company, on or prior to the Business
Day prior to the requested date of Issuance of such Letter of Credit,
that one or more of the applicable conditions contained in Article V is
not then satisfied;
(iii) the expiry date of such Letter of Credit is after
the Revolving Termination Date, or, in the case of a Commercial Letter
of Credit, the expiry date of such Letter of Credit is less than 25 days
prior to the Revolving Termination Date, unless all of the Lenders have
approved such expiry date in writing;
(iv) such Letter of Credit does not provide for drafts,
or is not otherwise in form and substance acceptable to such Issuing
Lender, or the Issuance of such Letter of Credit shall violate any
applicable policies of such Issuing Lender; or
(v) such Letter of Credit is denominated in a
currency other than Dollars.
-40-
48
3.2 Issuance, Amendment and Renewal of Letters of Credit. (a) Each
Letter of Credit shall be issued upon the irrevocable written request of the
Company received by the applicable Issuing Lender (with a copy sent by the
Company to the Agent) at least four days (or such shorter time as the applicable
Issuing Lender and the Agent may agree in a particular instance in their sole
discretion) prior to the proposed date of issuance. Each such request for
issuance of a Letter of Credit shall be by facsimile, confirmed immediately in
an original writing, in the form of an L/C Application, and shall specify in
form and detail satisfactory to the applicable Issuing Lender: (i) the face
amount of the Letter of Credit; (ii) the expiry date of the Letter of Credit;
(iii) the name and address of the beneficiary thereof; (iv) the documents to be
presented by the beneficiary of the Letter of Credit in case of any drawing
thereunder; (v) the full text of any certificate to be presented by the
beneficiary in case of any drawing thereunder; (vi) in the case of a standby
Letter of Credit, whether such letter of credit is a Financial Standby Letter of
Credit or a Non-Financial Standby Letter of Credit; and (vii) such other matters
as such Issuing Lender may require.
(b) At least two Business Days prior to the Issuance of any
Letter of Credit, the applicable Issuing Lender will confirm with the Agent (by
telephone or in writing) that the Agent has received a copy of the L/C
Application or L/C Amendment Application from the Company and, if not, such
Issuing Lender will provide the Agent with a copy thereof. Unless the applicable
Issuing Lender has received, on or before the Business Day immediately preceding
the date such Issuing Lender is to issue a requested Letter of Credit, (A)
notice from the Agent directing such Issuing Lender not to issue such Letter of
Credit because such issuance is not then permitted under subsection 3.1(a) as a
result of the limitations set forth in clause (1) or (2) thereof or (B) a notice
described in subsection 3.1(b)(ii), then, subject to the terms and conditions
hereof, such Issuing Lender shall, on the requested date, issue a Letter of
Credit for the account of the Company in accordance with such Issuing Lender's
usual and customary business practices.
(c) From time to time while a Letter of Credit is outstanding
and prior to the Revolving Termination Date, the applicable Issuing Lender will,
upon the written request of the Company received by such Issuing Lender (with a
copy sent by the Company to the Agent) at least four days (or such shorter time
as the applicable Issuing Lender and the Agent may agree in a particular
instance in their sole discretion) prior to the proposed date of amendment,
amend any Letter of Credit issued by it. Each such request for amendment of a
Letter of Credit shall be made by facsimile, confirmed immediately in an
original writing, made in the form of an L/C Amendment Application and shall
specify in form and detail satisfactory to the applicable Issuing Lender: (i)
the Letter of Credit to be amended; (ii) the proposed date of amendment of such
Letter of Credit (which shall
-41-
49
be a Business Day); (iii) the nature of the proposed amendment; and (iv) such
other matters as such Issuing Lender may require. No Issuing Lender shall have
any obligation to amend any Letter of Credit if: (A) such Issuing Lender would
have no obligation at such time to issue such Letter of Credit in its amended
form under the terms of this Agreement; or (B) the beneficiary of such Letter of
Credit does not accept the proposed amendment to such Letter of Credit. The
Agent will promptly notify the Lenders of any L/C Issuance.
(d) The Issuing Lenders and the Lenders agree that, while a
Letter of Credit is outstanding and prior to the Revolving Termination Date, at
the option of the Company and upon the written request of the Company received
by the applicable Issuing Lender (with a copy sent by the Company to the Agent)
at least four days (or such shorter time as the applicable Issuing Lender and
the Agent may agree in a particular instance in their sole discretion) prior to
the proposed date of notification of renewal, the applicable Issuing Lender
shall be entitled to authorize the automatic renewal of any Letter of Credit
issued by it. Each such request for renewal of a Letter of Credit shall be made
by facsimile, confirmed immediately in an original writing, in the form of an
L/C Amendment Application, and shall specify in form and detail satisfactory to
the applicable Issuing Lender: (i) the Letter of Credit to be renewed; (ii) the
proposed date of notification of renewal of such Letter of Credit (which shall
be a Business Day); (iii) the revised expiry date of such Letter of Credit
(which, unless all Lenders otherwise consent in writing, shall be prior to the
Revolving Termination Date); and (iv) such other matters as such Issuing Lender
may require. No Issuing Lender shall be under any obligation to renew any Letter
of Credit if: (A) such Issuing Lender would have no obligation at such time to
issue or amend such Letter of Credit in its renewed form under the terms of this
Agreement; or (B) the beneficiary of such Letter of Credit does not accept the
proposed renewal of such Letter of Credit. If any outstanding Letter of Credit
shall provide that it shall be automatically renewed unless the beneficiary
thereof receives notice from the applicable Issuing Lender that such Letter of
Credit shall not be renewed, and if at the time of renewal such Issuing Lender
would be entitled to authorize the automatic renewal of such Letter of Credit in
accordance with this subsection 3.2(d) upon the request of the Company but such
Issuing Lender shall not have received any L/C Amendment Application from the
Company with respect to such renewal or other written direction by the Company
with respect thereto, such Issuing Lender shall nonetheless be permitted to
allow such Letter of Credit to renew, and the Company and the Lenders hereby
authorize such renewal, and, accordingly, such Issuing Lender shall be deemed to
have received an L/C Amendment Application from the Company requesting such
renewal.
(e) Each Issuing Lender may, at its election (or as required by
the Agent at the direction of the Required Lenders), deliver any notices of
termination or other communications to any
-42-
50
Letter of Credit beneficiary or transferee, and take any other action as
necessary or appropriate, at any time and from time to time, in order to cause
the expiry date of such Letter of Credit to be a date not later than the
Revolving Termination Date.
(f) This Agreement shall control in the event of any conflict
with any L/C-Related Document (other than any Letter of Credit).
(g) Each Issuing Lender will deliver to the Agent, concurrently
or promptly following its delivery of a Letter of Credit, or amendment to or
renewal of a Letter of Credit, to an advising bank or a beneficiary, a true and
complete copy of each such Letter of Credit or amendment to or renewal of a
Letter of Credit.
3.3 Risk Participations, Drawings and Reimbursements.
(a) Immediately upon the Issuance of each Letter of Credit each
Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to,
purchase from the applicable Issuing Lender a participation in such Letter of
Credit and each drawing thereunder in an amount equal to the product of (i) such
Lender's Revolving Percentage times (ii) the maximum amount available to be
drawn under such Letter of Credit and the amount of such drawing, respectively.
(b) In the event of any request for a drawing under a Letter of
Credit by the beneficiary or transferee thereof, the applicable Issuing Lender
will promptly notify the Company and the Agent. The Company shall reimburse the
applicable Issuing Lender prior to 8:30 a.m. (San Francisco time), on each date
that any amount is paid by such Issuing Lender under any Letter of Credit (each
such date, an "Honor Date") in an amount equal to the amount so paid by such
Issuing Lender; provided, to the extent that any Issuing Lender accepts a
drawing under a Letter of Credit after 8:30 a.m. (San Francisco time), the
Company will not be obligated to reimburse the Issuing Lender until the next
Business Day and the "Honor Date" for such Letter of Credit shall be such next
Business Day. If the Company fails to reimburse an Issuing Lender for the full
amount of any drawing under any Letter of Credit by 8:30 a.m. (San Francisco
time) on the Honor Date, such Issuing Lender will promptly notify the Agent and
the Agent will promptly notify each Lender thereof, and the Company shall be
deemed to have requested that Base Rate Loans be made by the Lenders to be
disbursed on the Honor Date under such Letter of Credit, subject to the amount
of the unutilized portion of the Revolving Commitment and subject to the
conditions set forth in Section 5.3 other than Section 5.3(a). Any notice given
by an Issuing Lender or the Agent pursuant to this subsection 3.3(b) may be oral
if immediately confirmed in writing (including by facsimile); provided that the
lack of such an immediate confirmation shall not affect the conclusiveness or
binding effect of such notice.
-43-
51
(c) Each Lender shall upon any notice pursuant to subsection
3.3(b) make available to the Agent for the account of the applicable Issuing
Lender an amount in Dollars and in immediately available funds equal to its
Revolving Percentage of the amount of the drawing, whereupon the participating
Lenders shall (subject to subsection 3.3(d)) each be deemed to have made a
Revolving Loan consisting of a Base Rate Loan to the Company in such amount. If
any Lender so notified fails to make available to the Agent for the account of
the applicable Issuing Lender the amount of such Lender's Revolving Percentage
of the amount of such drawing by no later than 11:00 a.m. (San Francisco time)
on the Honor Date, then interest shall accrue on such Lender's obligation to
make such payment, from the Honor Date to the date such Lender makes such
payment, at a rate per annum equal to the Federal Funds Rate in effect from time
to time during such period. The Agent will promptly give notice of the
occurrence of the Honor Date, but failure of the Agent to give any such notice
on the Honor Date or in sufficient time to enable any Lender to effect such
payment on such date shall not relieve such Lender from its obligations under
this Section 3.3.
(d) With respect to any unreimbursed drawing that is not
converted into Revolving Loans consisting of Base Rate Loans in whole or in
part, because of the Company's failure to satisfy the conditions set forth in
Section 5.3 (other than Section 5.3(a) which need not be satisfied) or for any
other reason, the Company shall be deemed to have incurred from the applicable
Issuing Lender an L/C Borrowing in the amount of such drawing, which L/C
Borrowing shall be due and payable on demand (together with interest) and shall
bear interest at a rate per annum equal to the Base Rate plus the applicable
Base Rate Margin then in effect for Revolving Loans plus 2% per annum, and each
Lender's payment to such Issuing Lender pursuant to subsection 3.3(c) shall be
deemed payment in respect of its participation in such L/C Borrowing and shall
constitute an L/C Advance from such Lender in satisfaction of its participation
obligation under this Section 3.3.
(e) Each Lender's obligation in accordance with this Agreement
to make Revolving Loans or L/C Advances, as contemplated by this Section 3.3, as
a result of a drawing under a Letter of Credit, shall be absolute and
unconditional and without recourse to any Issuing Lender and shall not be
affected by any circumstance, including (i) any set-off, counterclaim,
recoupment, defense or other right which such Lender may have against the
applicable Issuing Lender, the Company or any other Person for any reason
whatsoever; (ii) the occurrence or continuance of an Event of Default, an
Unmatured Event of Default or a Material Adverse Effect; or (iii) any other
circumstance, happening or event whatsoever, whether or not similar to any of
the foregoing; provided that each Lender's obligation to make Revolving Loans
under this Section 3.3 is subject to the conditions set forth in Section 5.3.
-44-
52
3.4 Repayment of Participations. (a) Upon (and only upon) receipt by the
Agent for the account of an Issuing Lender of immediately available funds from
the Company (i) in reimbursement of any payment made by such Issuing Lender
under a Letter of Credit with respect to which any Lender has paid the Agent for
the account of such Issuing Lender for such Lender's participation in such
Letter of Credit pursuant to Section 3.3 or (ii) in payment of interest thereon,
the Agent will pay to each Lender, in the same funds as those received by the
Agent for the account of such Issuing Lender, the amount of such Lender's
Revolving Percentage of such funds, and such Issuing Lender shall receive the
amount of the Revolving Percentage of such funds of any Lender that did not so
pay the Agent for the account of such Issuing Lender.
(b) If the Agent or an Issuing Lender is required at any time to
return to the Company, or to a trustee, receiver, liquidator or custodian, or to
any official in any Insolvency Proceeding, any portion of any payment made by
the Company to the Agent for the account of an Issuing Lender pursuant to
subsection 3.4(a) in reimbursement of a payment made under a Letter of Credit or
interest or fee thereon, each Lender shall, on demand of the Agent, forthwith
return to the Agent or the applicable Issuing Lender the amount of its Revolving
Percentage of any amount so returned by the Agent or such Issuing Lender plus
interest thereon from the date such demand is made to the date such amount is
returned by such Lender to the Agent or such Issuing Lender, at a rate per annum
equal to the Federal Funds Rate in effect from time to time.
3.5 Role of the Issuing Lenders. (a) Each Lender and the Company agree
that, in paying any drawing under a Letter of Credit, the applicable Issuing
Lender shall not have any responsibility to obtain any document (other than any
sight draft and certificate expressly required by such Letter of Credit) or to
ascertain or inquire as to the validity or accuracy of any such document or the
authority of the Person executing or delivering any such document.
(b) No Agent-Related Person, Issuing Lender nor any of their
respective correspondents, participants or assignees shall be liable to any
Lender for: (i) any action taken or omitted in connection herewith at the
request or with the approval of the Lenders (including the Required Lenders, as
applicable); (ii) any action taken or omitted in the absence of gross negligence
or willful misconduct; or (iii) the due execution, effectiveness, validity or
enforceability of any L/C-Related Document.
(c) The Company hereby assumes all risks of the acts or
omissions of any beneficiary or transferee with respect to its use of any Letter
of Credit; provided that this assumption is not intended to, and shall not,
preclude the Company's pursuing such rights and remedies as it may have against
the beneficiary or transferee at law or under any other agreement. No
Agent-Related
-45-
53
Person, Issuing Lender nor any of their respective correspondents, participants
or assignees shall be liable or responsible for any of the matters described in
clauses (i) through (vii) of Section 3.6; provided that, anything in such
clauses to the contrary notwithstanding, the Company may have a claim against an
Issuing Lender, and such Issuing Lender may be liable to the Company, to the
extent, but only to the extent, of any direct, as opposed to consequential or
exemplary, damages suffered by the Company which the Company proves were caused
by such Issuing Lender's willful misconduct or gross negligence or such Issuing
Lender's willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of such Letter of Credit. In
furtherance and not in limitation of the foregoing: (i) an Issuing Lender may
accept documents that appear on their face to be in order, without
responsibility for further investigation, regardless of any notice or
information to the contrary; and (ii) no Issuing Lender shall be responsible for
the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign a Letter of Credit or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason (unless assuming the validity or
sufficiency of such instrument would constitute gross negligence or willful
misconduct by such Issuing Lender).
3.6 Obligations Absolute. The obligations of the Company under this
Agreement and any L/C-Related Document to reimburse the applicable Issuing
Lender for a drawing under a Letter of Credit, and to repay any L/C Borrowing
and any drawing under a Letter of Credit converted into Revolving Loans, shall
be unconditional and irrevocable, and shall be paid strictly in accordance with
the terms of this Agreement and each such other L/C-Related Document under all
circumstances, including the following:
(i) any lack of validity or enforceability of this
Agreement or any L/C-Related Document;
(ii) any change in the time, manner or place of payment
of, or in any other term of, all or any of the obligations of the
Company in respect of any Letter of Credit or any other amendment or
waiver of or any consent to departure from all or any of the L/C-Related
Documents;
(iii) the existence of any claim, set-off, defense or
other right that the Company may have at any time against any
beneficiary or any transferee of any Letter of Credit (or any Person
for whom any such beneficiary or any such transferee may be acting),
the applicable Issuing Lender or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or
by the L/C-Related Documents or any unrelated transaction;
-46-
54
(iv) any draft, demand, certificate or other document
presented under any Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or any loss or delay in the
transmission or otherwise of any document required in order to make a
drawing under any Letter of Credit;
(v) any payment by an Issuing Lender under any Letter
of Credit against presentation of a draft or certificate that does not
strictly comply with the terms of such Letter of Credit; or any payment
made by an Issuing Lender under any Letter of Credit to any Person
purporting to be a trustee in bankruptcy, debtor-in-possession, assignee
for the benefit of creditors, liquidator, receiver or other
representative of or successor to any beneficiary or any transferee of
any Letter of Credit, including any arising in connection with any
Insolvency Proceeding; provided that the reimbursement by the Company of
the applicable Issuing Lender or the repayment of any L/C Borrowing or
any Revolving Loans related to any such Letter of Credit will not affect
the claim, if any, that the Company may have against the applicable
Issuing Lender pursuant to Section 3.5(c) for willful misconduct or
gross negligence;
(vi) any exchange, release or non-perfection of any
collateral, or any release or amendment or waiver of or consent to
departure from any guarantee, for all or any of the obligations of the
Company in respect of any Letter of Credit; or
(vii) any other circumstance or happening whatsoever,
whether or not similar to any of the foregoing, including any other
circumstance that might otherwise constitute a defense available to, or
a discharge of, the Company or a guarantor.
3.7 Cash Collateral Pledge. If any Letter of Credit remains outstanding
and partially or wholly undrawn as of the Revolving Termination Date, then the
Company shall immediately Cash Collateralize the L/C Obligations in an amount
equal to the maximum amount then available to be drawn under all Letters of
Credit.
3.8 Letter of Credit Fees. (a) The Company shall pay to the Agent for
the account of each Lender a letter of credit fee with respect to each Letter of
Credit equal to the L/C Fee Rate per annum of the average daily maximum amount
available to be drawn on such Letter of Credit, computed on a quarterly basis in
arrears on the last Business Day of each calendar quarter. Such letter of credit
fee shall be due and payable quarterly in arrears on the last Business Day of
each calendar quarter during which Letters of Credit are outstanding, commencing
on the first such quarterly date to occur after the Closing Date, through the
-47-
55
Revolving Termination Date (or such later date upon which all outstanding
Letters of Credit shall expire or be fully drawn), with the final payment to be
made on the Revolving Termination Date (or such later date).
(b) The Company shall pay to each Issuing Lender a letter of
credit fronting fee for each Letter of Credit issued by such Issuing Lender
equal to 0.25% per annum of the average daily maximum amount available to be
drawn on such Letter of Credit, computed on the last Business Day of each
calendar quarter and on the Revolving Termination Date (or such later date on
which such Letter of Credit shall expire or be fully drawn).
(c) The letter of credit fees payable under subsection 3.8(a)
and the fronting fees payable under subsection 3.8(b) shall be due and payable
quarterly in arrears on the last Business Day of each calendar quarter during
which Letters of Credit are outstanding, commencing on the first such quarterly
date to occur after the Closing Date, through the Revolving Termination Date (or
such later date upon which all outstanding Letters of Credit shall expire or be
fully drawn), with the final payment to be made on the Revolving Termination
Date (or such later date). For purposes of calculating the fees payable under
subsection 3.8(a) and subsection 3.8(b), any undrawn Commercial Letters of
Credit should be considered outstanding and available to be drawn upon for 25
days after their expiry date.
(d) The Company shall pay to each Issuing Lender from time to
time on demand the normal issuance, presentation, amendment and other processing
fees, and other standard costs and charges, of such Issuing Lender relating to
letters of credit as from time to time in effect.
3.9 Uniform Customs and Practice. The Uniform Customs and Practice for
Documentary Credits as published by the International Chamber of Commerce most
recently at the time of issuance of any Letter of Credit shall (unless otherwise
expressly provided in such Letter of Credit) apply to each Letter of Credit.
ARTICLE IV
TAXES, YIELD PROTECTION AND ILLEGALITY
4.1 Taxes. (a) Any and all payments by the Company to each Lender or the
Agent under this Agreement and any other Loan Document shall be made free and
clear of, and without deduction or withholding for, any Taxes. In addition, the
Company shall pay all Other Taxes.
(b) The Company agrees to indemnify and hold harmless each
Lender and the Agent for the full amount of Taxes or Other Taxes (including any
Taxes or Other Taxes imposed by any
-48-
56
jurisdiction on amounts payable under this Section) paid by the Lender or the
Agent and any liability (including penalties, interest, additions to tax and
expenses) arising therefrom or with respect thereto, whether or not such Taxes
or Other Taxes were correctly or legally asserted. Payment under this
indemnification shall be made within 30 days after the date the Lender or the
Agent makes written demand therefor.
(c) If the Company shall be required by law to deduct or
withhold any Taxes or Other Taxes from or in respect of any sum payable
hereunder to any Lender or the Agent, then:
(i) the sum payable shall be increased as necessary so
that after making all required deductions and withholdings (including
deductions and withholdings applicable to additional sums payable under
this Section) such Lender or the Agent, as the case may be, receives an
amount equal to the sum it would have received had no such deductions or
withholdings been made;
(ii) the Company shall make such deductions and
withholdings; and
(iii) the Company shall pay the full amount deducted or
withheld to the relevant taxing authority or other authority in
accordance with applicable law.
(d) Within 30 days after the date of any payment by the Company
of Taxes or Other Taxes, the Company shall furnish the Agent the original or a
copy of a receipt evidencing payment thereof, or other evidence of payment
reasonably satisfactory to the Agent.
(e) The Company shall not be required to pay an additional
amount to, or indemnify, any Lender or the Agent pursuant to this Section 4.1 to
the extent that (i) the obligation to withhold or pay such amount existed on the
Initial Date (as hereinafter defined) or (ii) the obligation to withhold or pay
such amount would not have arisen but for the failure of the Agent or such
Lender to comply with the provisions of Section 10.10 of this Agreement. For
purposes of this subsection 4.1(e), "Initial Date" shall mean (a) in the case of
the Agent and any Lender that is a signatory hereto, the date of this Agreement,
(b) in the case of any Person which subsequently becomes a Lender hereunder, the
date of the applicable Assignment and Acceptance, and (c) in the case of any
Participant, the date on which it becomes a Participant.
(f) If the Company is required to pay additional amounts to any
Lender or the Agent pursuant to subsection (c) of this Section, then such Lender
shall use reasonable efforts (consistent with legal and regulatory restrictions)
to change the jurisdiction of its Lending Office so as to eliminate any such
additional payment by the Company which may thereafter accrue, if
-49-
57
such change in the judgment of such Lender is not otherwise disadvantageous to
such Lender.
4.2 Illegality. (a) After the date hereof, if any Lender determines that
the introduction of any Requirement of Law, or any change in any Requirement of
Law, or in the interpretation or administration of any Requirement of Law, has
made it unlawful, or that any central bank or other Governmental Authority has
asserted that it is unlawful, for such Lender or its applicable Lending Office
to make Offshore Rate Loans, then, on notice thereof by the Lender to the
Company through the Agent, any obligation of such Lender to make Offshore Rate
Loans shall be suspended until such Lender notifies the Agent and the Company
that the circumstances giving rise to such determination no longer exist.
(b) After the date hereof, if a Lender determines that it is
unlawful to maintain any Offshore Rate Loan, the Company shall, upon its receipt
of notice of such fact and demand from such Lender (with a copy to the Agent),
prepay in full such Offshore Rate Loan, together with interest accrued thereon
and amounts required under Section 4.4, either on the last day of the Interest
Period thereof, if such Lender may lawfully continue to maintain such Offshore
Rate Loan to such day, or on such earlier date on which such Lender may no
longer lawfully continue to maintain such Offshore Rate Loan (as determined by
such Lender). If the Company is required to so prepay any Offshore Rate Loan,
then concurrently with such prepayment, the Company shall borrow from the
affected Lender, in the amount of such repayment, a Base Rate Loan.
(c) If the obligation of any Lender to make or maintain Offshore
Rate Loans has been terminated or suspended pursuant to subsection (a) or (b)
above, all Loans which would otherwise be made by such Lender as Offshore Rate
Loans shall be instead Base Rate Loans.
(d) Before giving any notice to the Agent under this Section,
the affected Lender shall designate a different Lending Office with respect to
its Offshore Rate Loans if such designation will avoid the need for giving such
notice or making such demand and will not, in the judgment of such Lender, be
illegal or otherwise disadvantageous to such Lender.
4.3 Increased Costs and Reduction of Return. (a) After the date hereof,
if any Lender determines that, due to either (i) the introduction of or any
change (other than any change by way of imposition of or increase in reserve
requirements included in the calculation of the Offshore Rate) in or in the
interpretation of any law or regulation or (ii) compliance by such Lender with
any guideline or request from any central bank or other Governmental Authority
(whether or not having the force of law), there shall be any increase in the
cost to such Lender of agreeing to make or making, funding or maintaining any
Offshore Rate Loan or
-50-
58
participating in Letters of Credit or, in the case of any Issuing Lender, any
increase in the cost to such Issuing Lender of agreeing to issue, issuing or
maintaining any Letter of Credit or of agreeing to make or making, funding or
maintaining any unpaid drawing under any Letter of Credit, then the Company
shall be liable for, and shall from time to time, upon demand (with a copy of
such demand to be sent to the Agent), pay to the Agent for the account of such
Lender, additional amounts as are sufficient to compensate such Lender for such
increased costs.
(b) After the date hereof, if any Lender shall have determined
that (i) the introduction of any Capital Adequacy Regulation, (ii) any change in
any Capital Adequacy Regulation, (iii) any change in the interpretation or
administration of any Capital Adequacy Regulation by any central bank or other
Governmental Authority charged with the interpretation or administration
thereof, or (iv) compliance by such Lender (or its Lending Office) or any
corporation controlling such Lender with any Capital Adequacy Regulation,
affects or would affect the amount of capital required or expected to be
maintained by such Lender or any corporation controlling such Lender and (taking
into consideration such Lender's or such corporation's policies with respect to
capital adequacy) determines that the amount of such capital is increased as a
consequence of any of its Commitments, loans, credits or obligations under this
Agreement, then, upon demand of such Lender to the Company through the Agent,
the Company shall pay to such Lender, from time to time as specified by such
Lender, additional amounts sufficient to compensate such Lender for such
increase.
(c) This Section 4.3 shall not require the Company to reimburse
the Agent or any Lender for any Taxes which are otherwise covered by the
indemnity set forth in Section 4.1.
4.4 Funding Losses. The Company shall reimburse each Lender and hold
each Lender harmless from any loss or expense which such Lender may sustain or
incur as a consequence of:
(a) the failure of the Company to make on a timely basis any
payment of principal of any Offshore Rate Loan;
(b) the failure of the Company to borrow, continue or convert a
Loan after the Company has given (or is deemed to have given) a Notice of
Borrowing or a Notice of Conversion/ Continuation;
(c) the failure of the Company to make any prepayment in
accordance with any notice delivered under Section 2.6;
(d) the prepayment (including pursuant to Section 2.7 but
subject to the parenthetical at the end of such Section) or other payment
(including after acceleration thereof) of an Offshore Rate Loan on a day that is
not the last day of the relevant Interest Period; or
-51-
59
(e) the automatic conversion under subsection 2.4(a) of any
Offshore Rate Loan to a Base Rate Loan on a day that is not the last day of the
relevant Interest Period;
including any such loss or expense arising from the liquidation or reemployment
of funds obtained by it to maintain its Offshore Rate Loans or from fees payable
to terminate the deposits from which such funds were obtained. For purposes of
calculating amounts payable by the Company to the Lenders under this Section and
under subsection 4.3(a), each Offshore Rate Loan made by a Lender (and each
related reserve, special deposit or similar requirement) shall be conclusively
deemed to have been funded at the IBOR used in determining the Offshore Rate for
such Offshore Rate Loan by a matching deposit or other borrowing in the
interbank eurodollar market for a comparable amount and for a comparable period,
whether or not such Offshore Rate Loan is in fact so funded.
4.5 Inability to Determine Rates. If the Agent determines that for any
reason adequate and reasonable means do not exist for determining the Offshore
Rate for any requested Interest Period with respect to a proposed Offshore Rate
Loan, or the Required Lenders determine (and notify the Agent) that the Offshore
Rate applicable pursuant to subsection 2.9(a) for any requested Interest Period
with respect to a proposed Offshore Rate Loan does not adequately and fairly
reflect the cost to such Lenders of funding such Loan, the Agent will promptly
so notify the Company and each Lender. Thereafter, the obligation of the Lenders
to make or maintain Offshore Rate Loans hereunder shall be suspended until the
Agent, with the consent of the Required Lenders, revokes such notice in writing.
Upon receipt of such notice, the Company may revoke any Notice of Borrowing or
Notice of Conversion/Continuation then submitted by it. If the Company does not
revoke such Notice, the Lenders shall make, convert or continue the Loans, as
proposed by the Company, in the amount specified in the applicable notice
submitted by the Company, but such Loans shall be made, converted or continued
as Base Rate Loans instead of Offshore Rate Loan.
4.6 Certificates of Lenders. Any Lender claiming reimbursement or
compensation under this Article IV shall deliver to the Company (with a copy to
the Agent) a certificate setting forth in reasonable detail the basis for such
claim and a calculation of the amount payable to such Lender and such
certificate shall be conclusive and binding on the Company in the absence of
manifest error.
4.7 Substitution of Lenders. Upon the receipt by the Company from any
Lender (an "Affected Lender") of a claim for compensation under Section 4.1 or
4.3 or a notice of the type described in subsection 4.2(a) or (b), the Company
may: (i) request the Affected Lender to use its best efforts to obtain a
replacement bank or financial institution satisfactory to the Company and the
Agent to acquire and assume all or a ratable part
-52-
60
of all of such Affected Lender's Loans and Revolving Commitment (a "Replacement
Lender"); (ii) request one or more of the other Lenders to acquire and assume
all or part of such Affected Lender's Loans and Revolving Commitment; or (iii)
designate a Replacement Lender. Any such designation of a Replacement Lender
under clause (i) or (iii) shall be subject to the prior written consent of the
Agent and each Issuing Lender.
4.8 Survival. The agreements and obligations of the Company in this
Article IV shall survive the payment of all other Obligations.
ARTICLE V
CONDITIONS PRECEDENT
5.1 Documentary Conditions of Initial Credit Extensions. The obligation
of each Lender to make its initial Credit Extension is subject to the condition
(in addition to the conditions set forth in Sections 5.2 and 5.3) that the Agent
shall have received on or before October 6, 1995 all of the following, in form
and substance satisfactory to the Agent and each Lender, and in sufficient
copies for the Agent and each Lender:
(a) Credit Agreement and Notes. This Agreement and the
Notes (if any) executed by each party thereto.
(b) Resolutions and Incumbency of Company.
(i) Copies of resolutions of the board of directors of
the Company authorizing the transactions contemplated hereby, certified
as of the Closing Date by the Secretary or an Assistant Secretary of the
Company; and
(ii) A certificate of the Secretary or an Assistant
Secretary of the Company certifying the names and true signatures of the
officers of the Company authorized to execute, deliver and perform this
Agreement and all other Loan Documents to be delivered by it hereunder.
(c) Resolutions and Incumbency of Parent.
(i) Copies of resolutions of the board of directors of
the Parent authorizing the execution, delivery and performance of each
Loan Document to which it is a party certified as of the Closing Date by
the Secretary or an Assistant Secretary of the Parent; and
(ii) A certificate of the Secretary or an Assistant
Secretary of the Parent certifying the names and true signatures of the
officers of the Parent authorized to
-53-
61
execute, deliver and perform the Loan Documents to be delivered by it
hereunder.
(d) Organization Documents; Good Standing. Each of the
following documents:
(i) for the Company and the Parent, the articles or
certificate of incorporation and the bylaws of the Company or the
Parent, as the case may be, as in effect on the Closing Date, certified
by the Secretary or an Assistant Secretary of the Company or the Parent,
as the case may be, as of the Closing Date; and
(ii) a good standing and tax good standing certificate
for the Company and the Parent from the Secretaries of State (or
similar, applicable Governmental Authority) of Delaware and, in the case
of the Company, California.
(e) Legal Opinions.
(i) An opinion of Xxxxxx Xxxxxx & Xxxxxxx, counsel
to the Company and the Parent, substantially in the form of
Exhibit L,
(ii) Opinions of local counsel to the Company in
Minnesota, Pennsylvania, Arizona, California and Texas, substantially in
the forms of Exhibits X-0, X-0, X-0, M-4 and M-5 hereto, respectively.
(iii) An opinion of Xxxxx, Xxxxx & Xxxxx, special
counsel to the Agent, substantially in the form of Exhibit O,
(f) Solvency Opinion. An opinion of Houlihan, Lokey,
Xxxxxx & Zurkin, Inc. substantially in the form of Exhibit P.
(g) Payment of Fees. Evidence of payment by the Company of
all accrued and unpaid fees, costs and expenses to the extent then due and
payable on the Closing Date, together with Attorney Costs of the Agent and the
Arranger to the extent invoiced prior to or on the Closing Date, plus such
additional amounts of Attorney Costs as shall constitute the Agent's reasonable
estimate of Attorney Costs incurred or to be incurred by it or the Arranger
through the closing proceedings (provided that such estimate shall not
thereafter preclude final settling of accounts between the Company and the
Agent, including any such costs, fees and expenses arising under or referenced
in Section 2.10 or 11.4.
(h) Certificate. A certificate signed by a Responsible
Officer, dated as of the Closing Date, stating that:
-54-
62
(i) the representations and warranties contained
in Article VI are true and correct on and as of such date, as
though made on and as of such date;
(ii) no Event of Default or Unmatured Event of
Default exists or will result from the Credit Extension; and
(iii) no event or circumstance has occurred since
December 26, 1994 that has resulted, or would reasonably be expected to
result in a material adverse change in, or a material adverse effect
upon, the operations, business, properties, condition (financial or
otherwise) or prospects of, the Acquired Businesses.
(i) Security Agreement, etc. A security agreement, substantially
in the form of Exhibit E (the "Security Agreement"), issued by the Company and
the Parent, together with (a) evidence, satisfactory to the Agent, that all
filings and recordings necessary to perfect the Lien granted to the Agent (for
the benefit of itself and the Lenders) on any collateral granted under the
Security Agreement have been duly made (or will be duly made contemporaneously
with the initial Credit Extension on the Closing Date) and are in full force and
effect (subject to such exceptions as the Agent and the Required Lenders may
approve); (b) a trademark security agreement, substantially in the form of
Exhibit F (each a "Trademark Security Agreement"), issued by the Company and the
Parent, in each case to the extent applicable; and (c) a patent security
agreement, substantially in the form of Exhibit R (each a "Patent Security
Agreement"), issued by the Company and the Parent, in each case to the extent
applicable.
(j) Guaranty. The Guaranty executed by the Parent.
(k) Pledge Agreements. A pledge agreement, substantially in the
form of Exhibit H, issued by the Company (the "Company Pledge Agreement"), and a
pledge agreement, substantially in the form of Exhibit I, issued by Parent (the
"Parent Pledge Agreement"), together with, in the case of each Pledge Agreement,
the stock certificates to be pledged thereunder and stock powers executed in
blank.
(l) Real Property. With respect to each parcel of real property
owned by the Company or any Subsidiary (excluding Foreign Subsidiaries) or
leased by the Company in Tempe, Arizona, a duly executed Mortgage providing for
a fully perfected Lien, in favor of the Agent for the benefit of the Agent and
the Lenders, in all right, title and interest of the Company to the real
property subject to such Mortgage, superior in right to any Lien (other than
Permitted Liens), existing or future, which the Company or any Subsidiary or any
creditors thereof or purchasers therefrom, or any other Person, may have against
such real property, together with:
-55-
63
(i) an ALTA Form B (or other form acceptable to the Agent and
the Required Lenders) mortgagee policy of title insurance or a binder
issued by a title insurance company satisfactory to the Agent and the
Required Lenders insuring (or undertaking to insure, in the case of a
binder) that the Mortgage creates and constitutes a valid first mortgage
Lien against such real property in favor of the Agent, subject only to
exceptions acceptable to the Agent and the Required Lenders, with such
endorsements and affirmative insurance as the Agent or the Required
Lenders may reasonably request;
(ii) copies of all documents of record concerning such parcel as
shown on the commitment for the ALTA Loan Title Insurance Policy
referred to above;
(iii) original or certified copies of all insurance policies
required to be maintained with respect to such real property by this
Agreement, any Mortgage or any other Loan Document; and
(iv) a survey certified to the Agent as complying with the 1992
ALTA/ACSM requirements for an urban survey and containing items 1, 2, 3,
4, 7, 8, 9, 10, 11, and 13 from Table A and such other matters as the
Agent may reasonably request.
(m) Landlord's Consents. With respect to the parcel of real
property leased by the Company in Tempe, Arizona, a duly executed Landlord's
Consent.
(n) Purchase Agreement Assignment. The Purchase Agreement
Assignment.
(o) Purchase Agreements, and Other Documents. A copy, certified
as true and correct by the Secretary or an Assistant Secretary of the Company,
of each of (a) the Purchase Agreements (including all exhibits and schedules
thereto), (b) the Securities Purchase Agreement (including all exhibits and
schedules thereto), (c) the Shareholder Agreement, (d) the Transition Services
Agreement and (e) the Tax Sharing Agreement.
(p) Other Documents. Such other approvals, opinions, documents
or materials as the Agent or any Lender may request.
5.2 Other Conditions to Initial Loan or Letter of Credit. The obligation
of each Lender to make its initial Credit Extension is, in addition to the
conditions precedent specified in Sections 5.1 and 5.3, subject to the following
conditions precedent:
(a) Capitalization of the Company. The Agent shall have received
evidence, reasonably satisfactory to the Agent, the Required Lenders and the
Arranger, that the Company has received
-56-
64
common equity investments from the Parent of not less than $35,000,000, on terms
and conditions satisfactory to the Agent.
(b) Capitalization of the Parent. The Agent shall have received
evidence, reasonably satisfactory to the Agent, the Required Lenders and the
Arranger, that the Parent has received investments from the Initial Parent
Stockholders of not less than $35,000,000, which investment shall be in cash and
shall be evidenced by at least $5,000,000 in common stock and $30,000,000 of
Subordinated Notes.
(c) Subordinated Notes. The Parent shall have issued the
Subordinated Notes on terms and conditions satisfactory to the Agent.
(d) Purchase. The Agent shall have received evidence, reasonably
satisfactory to the Agent, that (i) the Purchase has been completed and (ii) the
purchase price with respect thereto did not exceed $115,000,000 (subject to
working capital adjustments set forth in Section 2.3 of the U.S. Purchase
Agreement and Section 2.9 of the German Purchase Agreement) and (iii)
transaction expenses with respect to Purchase (including the transaction costs
associated with the financing contemplated hereby will not exceed $10,500,000).
5.3 Conditions to All Credit Extensions. The obligation of each Lender
to make any Loan to be made by it and the obligation of each Issuing Lender to
Issue any Letter of Credit is subject to the satisfaction of the following
conditions precedent on the relevant Borrowing Date or Issuance Date:
(a) Notice, Application. In the case of any Loan, the Agent
shall have received a Notice of Borrowing; and in the case of any Issuance of
any Letter of Credit, the applicable Issuing Lender and the Agent shall have
received an L/C Application or L/C Amendment Application, as required under
Section 3.2.
(b) Continuation of Representations and Warranties. The
representations and warranties in Article VI shall be true and correct on and as
of such Borrowing Date or Issuance Date with the same effect as if made on and
as of such Borrowing Date or Issuance Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they shall be true and correct as of such earlier date).
(c) No Existing Default. No Event of Default or Unmatured Event
of Default shall exist or shall result from such Borrowing or Issuance.
Each Notice of Borrowing and L/C Application or L/C Amendment Application
submitted by the Company hereunder shall constitute a representation and
warranty by the Company hereunder, as of the date of such notice and as of the
applicable Borrowing Date or
-57-
65
Issuance Date, that the conditions in this Section 5.3 are satisfied.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Company represents and warrants to the Agent and each Lender that:
6.1 Corporate Existence and Power. The Company and each of its
Subsidiaries:
(a) is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation;
(b) has the power and authority and all governmental licenses,
authorizations, consents and approvals (i) to own its assets and to carry on its
business and (ii) to execute, deliver and perform its obligations under the Loan
Documents;
(c) is duly qualified as a foreign corporation and is licensed and
in good standing under the laws of each jurisdiction where its ownership, lease
or operation of property or the conduct of its business requires such
qualification or license; and
(d) is in compliance with all Requirements of Law;
except, in each case referred to in clause (b)(i), (c) or (d), to the extent
that the failure to do so would not reasonably be expected to have a Material
Adverse Effect.
6.2 Corporate Authorization; No Contravention. The execution and
delivery by the Company of this Agreement and each other Loan Document to which
it is a party, the Borrowings hereunder, the execution and delivery by each
Guarantor of the Guaranty and each other Loan Document to which it is a party
and the performance by each of the Company and each Guarantor of its obligations
under each Loan Document to which it is a party (i) are within the corporate
powers of the Company and each Guarantor, as applicable, (ii) have been duly
authorized by all necessary corporate action on the part of the Company and each
Guarantor (including any necessary shareholder action), and (iii) do not and
will not:
(a) contravene the terms of any of the Organization Documents of
the Company or any Guarantor;
(b) conflict with or result in a breach or contravention of, or
the creation of any Lien under, any document evidencing any Contractual
Obligation to which the Company, or
-58-
66
any Guarantor is a party or any order, injunction, writ or decree of any
Governmental Authority to which the Company, any Guarantor or any of their
properties are subject; or
(c) violate any Requirement of Law.
6.3 Governmental Authorization. No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority is necessary or required in connection with the
execution, delivery or performance by, or enforcement against, (i) the Company
of this Agreement or any other Loan Document to which it is a party or (ii) any
Guarantor with respect to the Guaranty or any other Loan Document to which it is
a party.
6.4 Binding Effect. This Agreement and each other Loan Document to
which the Company is a party constitute the legal, valid and binding obligations
of the Company, enforceable against the Company in accordance with their
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability; and with
respect to each Guarantor, the Guaranty and each other Loan Document to which
such Guarantor is a party constitute the legal, valid and binding obligation of
such Guarantor, enforceable against such Guarantor in accordance with their
respective terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally and by equitable principles relating to enforceability.
6.5 Litigation. Except as specifically disclosed in Schedule 6.5,
there are no actions, suits, proceedings, claims or disputes pending, or to the
best knowledge of the Company, threatened or contemplated, at law, in equity, in
arbitration or before any Governmental Authority, against the Company or any
Subsidiary or any of their respective properties which: (a) purport to affect or
pertain to this Agreement or any other Loan Document, or any of the transactions
contemplated hereby or thereby; or (b) would reasonably be expected to have a
Material Adverse Effect. No injunction, writ, temporary restraining order or
other order of any nature has been issued by any court or other Governmental
Authority purporting to enjoin or restrain the execution, delivery or
performance of this Agreement or any other Loan Document, or directing that the
transactions provided for herein or therein not be consummated as herein or
therein provided.
6.6 No Default. No Event of Default or Unmatured Event of Default
exists or would result from the incurring of any Obligations by the Company. As
of the Closing Date, neither the Company nor any Subsidiary is in default under
or with respect to any Contractual Obligation in any respect which, individually
or together with all such defaults, would reasonably be expected to
-59-
67
have a Material Adverse Effect, or that would, if such default had occurred
after the Closing Date, create an Event of Default under subsection 9.1(e).
6.7 ERISA Compliance.
(a) Each Plan (other than a Multi-Employer Plan) is in
compliance in all material respects with the applicable provisions of ERISA, the
Code and other federal or state law. The Company and each ERISA Affiliate has
made all required contributions to any Plan subject to Section 412 of the Code,
and no application for a funding waiver or an extension of any amortization
period pursuant to Section 412 of the Code has been made with respect to any
Plan.
(b) There are no pending or, to the best knowledge of the
Company, threatened claims, actions or lawsuits, or action by any Governmental
Authority, with respect to any Plan which has resulted or would reasonably be
expected to result in a Material Adverse Effect. There has been no prohibited
transaction or violation of the fiduciary responsibility rules with respect to
any Plan which has resulted or would reasonably be expected to result in a
Material Adverse Effect.
(c) (i) Unfunded Pension Liabilities for all Pension Plans
(other than Multi-Employer Plans) do not exceed the aggregate amount of
$7,000,000 ; (ii) No ERISA Event has occurred or is reasonably expected to occur
that has resulted or would reasonably be expected to result in an outstanding
payment obligation of the Company in an aggregate amount in excess of $2,000,000
at any time; (iii) no contribution failure has occurred with respect to a
Pension Plan sufficient to give rise to a Lien under Section 302(f) of ERISA;
(iv) neither the Company nor any ERISA Affiliate has incurred and remains liable
for, or reasonably expects to incur, any liability under Section 4243 of ERISA
with respect to a Multi-Employer Plan in an aggregate amount in excess of
$2,000,000; and (v) neither the Company nor any ERISA Affiliate has engaged in
one or more transactions that could reasonably be subject to Section 4069 or
4212(c) or ERISA and result in an outstanding liability in excess of $2,000,000
at any time.
6.8 Use of Proceeds; Margin Regulations. The proceeds of the Loans
are to be used solely for the purposes set forth in and permitted by Sections
7.13 and 8.7. Neither the Company nor any Subsidiary is generally engaged in the
business of purchasing or selling Margin Stock or extending credit for the
purpose of purchasing or carrying Margin Stock.
6.9 Title to Properties. Each of the Company and each Subsidiary
has good record and marketable title in fee simple to, or a valid leasehold
interest in, all real property reasonably necessary or used in the ordinary
conduct of its businesses, except for such defects in title as would not,
individually or in
-60-
68
the aggregate, have a Material Adverse Effect. As of the Closing Date, the
property of the Company and its Subsidiaries is subject to no Liens, other than
Permitted Liens.
6.10 Taxes. The Company and its Subsidiaries have filed all
Federal and other material tax returns and reports required to be filed, and
have paid all Federal and other material taxes, assessments, fees and other
governmental charges levied or imposed upon them or their properties, income or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings and for which adequate reserves have been
provided in accordance with GAAP. There is no proposed tax assessment against
the Company or any Subsidiary that would, if made, have a Material Adverse
Effect.
6.11 Financial Condition. (a) The audited consolidated financial
statements of the Acquired Businesses dated December 25 1994, and the unaudited
consolidated financial statements of the Acquired Businesses dated August 31,
1995, and the related consolidated statements of income or operations,
shareholders' equity and cash flows for the fiscal periods ended on such dates:
(i) were, in the case of the audited statements of ICI
Composites, Inc., prepared in accordance with GAAP consistently applied
throughout the periods covered thereby, except as otherwise expressly
noted therein;
(ii) were, in the case of the audited statements of
Fiberite Europe GmbH, prepared in accordance with generally accepted
accounting principles in Germany consistently applied throughout the
periods covered thereby, except as otherwise expressly noted therein;
(iii) were, in the case of the unaudited statements of
each Acquired Business, prepared in accordance with the Sellers'
internal policies consistently applied throughout the periods covered
thereby;
(iv) fairly present the financial condition of the
Acquired Businesses as of the dates thereof and results of operations
for the periods covered thereby; and
(v) except as specifically disclosed in Schedule 6.11,
show all material indebtedness and other liabilities, direct or
contingent, of the Acquired Businesses as of the date thereof, including
liabilities for taxes, material commitments and Contingent Obligations.
(b) The pro forma consolidated statements of income (i) for the
year ended December 31, 1994 and (ii) for the eight months ended August 31,
1995, and a pro forma consolidated balance sheet at August 31, 1995, of the
Company and its Subsidiaries (including the German operations), derived from the
historical financial statements of the Acquired Businesses which
-61-
69
(i) for the year ended December 31, 1994 were audited by KPMG Peat Marwick LLP
and (ii) for the eight months ended August 31, 1995 have been based upon the
unaudited financial statements of the Acquired Businesses delivered to the
Company by the Sellers, together with a report by Xxxxxx Xxxxxxxx LLP indicating
that firm's performance of certain procedures to the pro forma consolidated
financial statements.
(c) The forecasted financial statements set forth in the
Confidential Information Memorandum dated September 1995, which were delivered
to each Lender, have been prepared by the Company and its Subsidiaries and
represent, as of the date of this Agreement, the good faith estimate of the
Company and its senior management of the most probable course of the business of
the Company and its Subsidiaries. Such forecasted financial statements were
prepared in good faith on the basis of information and assumptions that the
Company and its senior management believed to be reasonable as of the date of
the Confidential Information Memorandum, and such assumptions are reasonable as
of the Closing Date (it being understood that projections are subject to
significant uncertainties and contingencies, many of which are beyond the
Company's control, and that no assurance can be given that the projections will
be realized).
(d) During the period from December 26, 1994 through the Closing
Date, there has been no material adverse change in, or a material adverse effect
upon, the operations, business, properties, conditions (financial or otherwise)
or prospects of, the Acquired Businesses and since the Closing Date there has
been no Material Adverse Effect.
6.12 Environmental Matters. Except as specifically disclosed in Schedule
6.12, neither any non-compliance with any Environmental Laws, nor any liability
under any Environmental Laws, nor all Environmental Claims, in each case as in
effect on or prior to the Closing Date, on or with respect to the business,
operations and properties of the Company would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
6.13 Regulated Entities. None of the Company, any Person controlling the
Company, or any Subsidiary is an "Investment Company" within the meaning of the
Investment Company Act of 1940. The Company is not subject to regulation under
the Public Utility Holding Company Act of 1935, the Federal Power Act, the
Interstate Commerce Act, any state public utilities code, or any other Federal
or state statute or regulation limiting its ability to incur Indebtedness.
6.14 No Burdensome Restrictions. Neither the Company nor any Subsidiary
is a party to or bound by any Contractual Obligation, or subject to any
restriction in any Organization
-62-
70
Document, or any Requirement of Law, which would reasonably be expected to have
a Material Adverse Effect.
6.15 Copyrights, Patents, Trademarks and Licenses, etc. The Company and
its Subsidiaries own or are licensed or otherwise have the right to use all of
the patents, trademarks, service marks, trade names, copyrights, contractual
franchises, authorizations and other rights that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of the Company, no slogan or other
advertising device, product, process, method, substance, part or other material
now employed, or now contemplated to be employed, by the Company or any
Subsidiary infringes upon any rights held by any other Person. Except as
specifically disclosed in Schedule 6.5, no claim or litigation regarding any of
the foregoing is pending or threatened, and no patent, invention, device,
application, principle or any statute, law, rule, regulation, standard or code
is pending or, to the knowledge of the Company, proposed, which, in either case,
would reasonably be expected to have a Material Adverse Effect.
6.16 Subsidiaries. As of the Closing Date, the Company has no
Subsidiaries other than those specifically disclosed in part (a) of Schedule
6.16 hereto and has no equity investments in any other corporation or entity
other than those specifically disclosed in part (b) of Schedule 6.16.
6.17 Insurance. Except as specifically disclosed in Schedule 6.17, the
properties of the Company and its Subsidiaries are insured with financially
sound and reputable insurance companies not Affiliates of the Company, in such
amounts, with such deductibles and covering such risks as are customarily
carried by companies engaged in similar businesses and owning similar properties
in localities where the Company or such Subsidiary operates.
6.18 Solvency, etc. On the Closing Date (or, in the case of any Person
which becomes a Guarantor after the Closing Date, on the date such Person
becomes a Guarantor), and immediately prior to and after giving effect to the
Issuance of each Letter of Credit and each Borrowing hereunder and the use of
the proceeds thereof, (a) each of the Company's and each Guarantor's assets will
exceed its liabilities and (b) each of the Company and each Guarantor will be
solvent, will be able to pay its debts as they mature, will own property with
fair saleable value greater than the amount required to pay its debts and will
have capital sufficient to carry on its business as then constituted.
6.19 Purchase, etc.
(a) Concurrent with the initial Credit Extension, the Purchase
has been consummated in accordance with the terms of the Purchase
Agreements.
-63-
71
(b) The Purchase complied in all material respects with all
applicable legal requirements, and all necessary governmental,
regulatory, shareholder and other consents and approvals required for
the consummation of the Purchase were, prior to the consummation
thereof, duly obtained and in full force and effect.
(c) The execution and delivery of the Purchase Agreements, and
the consummation of the Purchase did not violate any material statute or
regulation of the United States or of any state or other applicable
jurisdiction, or any material order, judgment or decree of any court or
governmental body, or result in a breach of, or constitute a default
under, any material agreement, indenture, order or decree affecting the
Company or any of its respective Subsidiaries (including entities which
will be Subsidiaries after giving effect to the Purchase.
(d) All of the representations and warranties of the Company
and, to the best of the Company's knowledge, Sellers contained in the
Purchase Agreements are true and correct as of the date hereof.
(e) All of the representations and warranties of the
Company set forth in the Securities Purchase Agreement are
true and correct as of the date hereof.
6.20 Real Property. Set forth on Schedule 6.20 is a complete and
accurate list, as of the date of this Agreement and after giving effect to the
Purchase, of the address and legal description of any real property owned or
leased by the Company or any Subsidiary, together with, in the case of leased
property, the name and mailing address of the lessor of such property.
6.21 Swap Obligations. Neither the Company nor any of its Subsidiaries
has incurred any outstanding obligations under any Swap Contracts, other than
Permitted Swap Obligations. The Company has undertaken its own independent
assessment of its consolidated assets, liabilities and commitments and has
considered appropriate means of mitigating and managing risks associated with
such matters and has not relied on any swap counterparty or any Affiliate of any
swap counterparty in determining whether to enter into any Swap Contract.
6.22 Full Disclosure. None of the representations or warranties made by
the Company or any Subsidiary in the Loan Documents as of the date such
representations and warranties are made or deemed made and none of the written
statements contained in any exhibit, report, statement or certificate furnished
by or on behalf of the Company or any Subsidiary in connection with the Loan
Documents, considering each of the foregoing in the context in which it was made
and together with all other representations, warranties and written statements
theretofore furnished by the Company and its Subsidiaries to the Agent and the
Lenders in
-64-
72
connection with the Loan Documents, contains any untrue statement of
a material fact or omits any material fact required to be stated therein or
necessary to make such representation, warranty or written statement, in light
of the circumstances under which it is made, not misleading as of the time when
made or delivered; provided that the Company's representation and warranty as to
any forecast, projection or other statement regarding future performance, future
financial results or other future development is limited to the fact that such
forecast, projection or statement was prepared in good faith on the basis of
information and assumptions that the Company believed to be reasonable as of
the date such material was provided (it being understood that projections are
subject to significant uncertainties and contingencies, many of which are beyond
the Company's control, and that no assurance can be given that the projections
will be realized).
ARTICLE VII
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Lenders waive compliance in
writing:
7.1 Financial Statements. The Company shall deliver to the Agent and
each Lender, in form and detail satisfactory to the Required Lenders:
(a) as soon as available, but not later than 90 days after the end
of each fiscal year, a copy of the audited consolidated balance sheet of the
Company and its Subsidiaries as at the end of such year and the related
consolidated statements of income or operations, shareholders' equity and cash
flows for such year, setting forth in each case in comparative form the figures
for the previous fiscal year, and accompanied by the opinion of Xxxxxx Xxxxxxxx
LLP or another nationally-recognized independent public accounting firm
("Independent Auditor"), which report (x) shall state that such consolidated
financial statements present fairly the consolidated financial position of the
Company and its Subsidiaries for the periods indicated in conformity with GAAP
applied on a basis consistent with prior years and (y) shall not be qualified or
limited because of a restricted or limited examination by the Independent
Auditor of any material portion of the Company's or any Subsidiary's records;
(b) Promptly when available and in any event within 45 days after
the end of each month, (i) balance sheets of the Company and each Subsidiary as
of the end of such month, and the related statements of income, shareholders'
equity and cash flow for such month and for the period beginning with the first
day of
-65-
73
the applicable fiscal year and ending on the last day of such month, including a
comparison with the corresponding month and period of the previous fiscal year
and a comparison with the budget for such month and for such period of the
current fiscal year, together with a certificate of the chief executive officer,
the chief financial officer or the comptroller of the Company that such
statement fairly presents the financial condition and results of operations of
the Company and its Subsidiaries (subject to normal year end adjustments and,
during the period from the Closing Date through December 31, 1995, the effects
of purchase accounting adjustments) and have been prepared in accordance with
the management policies consistently applied and (ii) if such month is the end
of a fiscal quarter, a copy of the unaudited consolidated balance sheet of the
Company and its Subsidiaries as of the end of such quarter and the related
consolidated statements of income, shareholders' equity and cash flows for the
period commencing on the first day and ending on the last day of such quarter,
together with a certificate of the chief executive officer, the chief financial
officer or the Comptroller of the Company that such statement fairly presents
the financial condition and results of operations (subject to normal year end
adjustments) of the Company and its Subsidiaries and have been prepared in
accordance with GAAP consistently applied; and
(c) As soon as available but not later than December 31, 1995 the
unaudited consolidated balance sheet of the Company and its Subsidiaries as of
the Closing Date (giving effect to the Purchase and other transactions
contemplated to occur on such date) prepared by the Company in accordance with
GAAP.
7.2 Certificates; Other Information. The Company shall furnish to each
Lender:
(a) concurrently with the delivery of the financial statements
referred to in subsection 7.1(a), a certificate of the Independent Auditor
stating that in making the examination necessary therefor no knowledge was
obtained of any Event of Default or Unmatured Event of Default, except as
specified in such certificate;
(b) concurrently with the delivery of the financial statements
referred to in subsection 7.1(a) and each set of quarterly statements referred
to in subsection 7.1(b)(ii), a Compliance Certificate executed by a Responsible
Officer;
(c) promptly, copies of all financial statements and reports that
the Company sends to its shareholders, and copies of all financial statements
and regular, periodic or special reports (including Forms 10K, 10Q and 8K) that
the Company or any Subsidiary may make to, or file with, the SEC; and
-66-
74
(d) promptly, such additional information regarding the business,
financial or corporate affairs of the Company or any Subsidiary as the Agent, at
the request of any Lender, may from time to time reasonably request.
7.3 Notices. Promptly upon a Responsible Officer obtaining knowledge
thereof, the Company shall notify the Agent (and the Agent will promptly
distribute such notice to the Lenders) of:
(a) the occurrence of any Event of Default or Unmatured Event of
Default;
(b) any matter that has resulted or would reasonably be expected to
result in a Material Adverse Effect, including (i) any breach or non-performance
of, or any default under, a Contractual Obligation of the Company or any
Subsidiary; (ii) any dispute, litigation, investigation, proceeding or
suspension between the Company or any Subsidiary and any Governmental Authority;
or (iii) the commencement of, or any material development in, any litigation or
proceeding affecting the Company or any Subsidiary, including pursuant to any
applicable Environmental Laws;
(c) the occurrence of any of the following events affecting the
Company or any ERISA Affiliate (but in no event more than 30 days after such
event, provided that the Company shall notify the Agent and each Lender not less
than ten days before the occurrence of any event described in clause (ii)
below), and deliver to the Agent and each Lender a copy of any notice with
respect to such event that is filed with a Governmental Authority and any notice
delivered by a Governmental Authority to the Company or any ERISA Affiliate with
respect to such event:
(i) an ERISA Event which has resulted or could reasonably be
expected to result in liability of the Company in an aggregate amount
in excess of $500,000;
(ii) a contribution failure with respect to a Pension Plan
sufficient to give rise to a Lien under Section 302(f) of ERISA;
(iii) an increase in the Unfunded Pension Liability in an
aggregate amount of $2,000,000 or more of one or more Pension Plans
(other than Multiemployer Plans) for a reason other than market
fluctuation;
(iv) the adoption of, or the commencement of contributions to,
any Plan subject to Section 412 of the Code by the Company or any ERISA
Affiliate; or
(v) the adoption of any amendment to a Plan (other than a
Multiemployer Plan) subject to Section 412 of the
-67-
75
Code, if such amendment results in a material increase in contributions
or Unfunded Pension Liability;
(d) any material change in accounting policies or financial
reporting practices by the Company or any of its consolidated Subsidiaries; or
(e) any event which will give rise to a prepayment pursuant to
Section 2.7.
(f) upon the request from time to time of the Agent, the Swap
Termination Values, together with a description of the method by which such
values were determined, relating to any then-outstanding Swap Contracts to which
the Company or any of its Subsidiaries is party.
Each notice under this Section shall be accompanied by a written
statement by a Responsible Officer setting forth details of the occurrence
referred to therein, and stating what action the Company or any affected
Subsidiary proposes to take with respect thereto and at what time. Each notice
under subsection 7.3(a) shall describe with particularity any and all clauses or
provisions of this Agreement or any other Loan Document that have been breached
or violated.
7.4 Preservation of Corporate Existence, Etc. The Company shall, and
shall cause each Subsidiary to:
(a) preserve and maintain in full force and effect its corporate
existence and good standing under the laws of its state or jurisdiction of
incorporation except a subsidiary need not be in compliance with the foregoing
to the extent such subsidiary is sold pursuant to Section 8.2 or merged or
consolidated unto another Person pursuant to Section 8.3;
(b) preserve and maintain in full force and effect all material
governmental rights, privileges, qualifications, permits, licenses and
franchises necessary or desirable in the normal conduct of its business except
in connection with transactions permitted by Section 8.3(ii) and assets
permitted by Section 8.2;
(c) use reasonable efforts, in the ordinary course of business, to
preserve its business organization and goodwill; and
(d) preserve or renew all of its registered patents, trademarks,
trade names and service marks, the non-preservation of which would reasonably be
expected to have a Material Adverse Effect.
7.5 Maintenance of Property. The Company shall, and shall cause each
Subsidiary to, maintain and preserve all its property which is used or useful in
its business in good working order and
-68-
76
condition, ordinary wear and tear excepted, other than obsolete, worn out or
surplus equipment.
7.6 Insurance. The Company shall, and shall cause each Subsidiary to,
maintain, with financially sound and reputable independent insurers, insurance
with respect to its properties and business against loss or damage of the kinds
customarily insured against by Persons engaged in the same or similar business,
of such types and in such amounts as are customarily carried under similar
circumstances by such other Persons.
7.7 Payment of Obligations. The Company shall, and shall cause each
Subsidiary to, pay and discharge as the same shall become due and payable, all
their respective obligations and liabilities, including:
(a) all tax liabilities, assessments and governmental charges or
levies upon it or its properties or assets; and
(b) all lawful claims which, if unpaid, would by law become a Lien
upon its property;
unless, in each case, the same are being contested in good faith by appropriate
proceedings and adequate reserves in accordance with GAAP are being maintained
by the Company or such Subsidiary.
7.8 Compliance with Laws. The Company shall, and shall cause each
Subsidiary to, comply in all material respects with all Requirements of Law of
any Governmental Authority having jurisdiction over it or its business
(including the Federal Fair Labor Standards Act), except such as may be
contested in good faith or as to which a bona fide dispute may exist.
7.9 Compliance with ERISA. The Company shall, and shall cause each of
its Subsidiaries to maintain each Plan (other than a Multiemployer Plan) in
compliance in all material respects with the applicable provisions of ERISA, the
Code and other federal or state law, including, without limitation, the making
of contributions thereunder.
7.10 Inspection of Property and Books and Records. The Company shall,
and shall cause each Subsidiary to, maintain proper books of record and account,
in which full, true and correct entries in conformity with GAAP consistently
applied shall be made of all financial transactions and matters involving the
assets and business of the Company and such Subsidiary. Subject to the Defense
Agreement, the Company shall permit, and shall cause each Subsidiary to permit,
representatives and independent contractors of the Agent or any Lender (a) to
visit and inspect any of their respective properties, to examine their
respective corporate, financial and operating records, and to make copies
thereof or abstracts therefrom, and to discuss their respective affairs,
finances and accounts with their respective directors, officers, and independent
public accountants and (b)
-69-
77
to inspect any of their inventory and equipment, to perform appraisals of any of
their equipment, and to inspect, audit, check and make copies and/or extracts
from the books, records, computer data and records, computer programs, journals,
orders, receipts, correspondence and other data relating to inventory, accounts
receivable, contract rights, general intangibles, equipment and any other
collateral, or relating to any other transactions between the parties hereto; at
such reasonable times during normal business hours and as often as may be
reasonably desired, upon reasonable advance notice to the Company; provided,
however, that when an Event of Default exists, the Agent or any Lender may do
any of the foregoing without advance notice. If an Event of Default exists any
such inspection shall be at the Company's expense, otherwise only one such
inspection per year (which the Agent or the Required Lenders shall designate as
the inspection for which they will be reimbursed) will be at the Company's
expense.
7.11 Environmental Laws. The Company shall, and shall cause each
Subsidiary to, conduct its operations and keep and maintain its property in
material compliance with all Environmental Laws.
7.12 Interest Rate Protection. The Company shall, not later than 180
days after the Closing Date, enter into one or more Permitted Swap Obligations,
each with a term of at least two years, on an ISDA standard form with one or
more Lenders or with counterparties reasonably acceptable to the Required
Lenders which will ensure that the effective rate of interest (assuming no
reductions in the Applicable Offshore Rate Margin or Applicable Base Rate
Margin) payable by the Company with respect to not less than $37,500,000 of the
principal amount of the Loans will not at any time during the duration of such
Swap Obligations exceed 11% per annum.
7.13 Use of Proceeds. The Company shall use the proceeds of the
Loans (i) to finance the Purchase and (ii) for working capital and other general
corporate purposes not in contravention of any Requirement of Law or of any Loan
Document.
7.14 Further Assurances. Promptly upon the request of the Agent, or
the Required Lenders, the Company shall, and shall cause each Subsidiary to,
execute, acknowledge, deliver, record, re-record, file, re-file, register and
re-register, any and all such further acts, deeds, conveyances, security
agreement, mortgages, assignments, estoppel certificates, financing statements
and continuations thereof, termination statements, notices of assignment,
transfers, certificates, assurances and other instruments the Agent or the
Required Lenders as the case may be, may reasonably request from time to time in
order (a) to ensure that (i) the obligations of the Company hereunder and under
the other Loan Documents are secured by substantially all assets of the Company
(provided, that unless otherwise reasonably required by the Required Lenders,
the pledge of the common stock of a Foreign Subsidiary shall be limited to 65%
of the
-70-
78
outstanding common stock of such Subsidiary) and guaranteed, pursuant to the
Guaranty, by the Parent and all Subsidiaries (including, promptly upon the
acquisition or creation thereof, any Subsidiary created or acquired after the
date hereof) other than Foreign Subsidiaries unless otherwise reasonably
required by the Required Lenders, (ii) the obligations of each Subsidiary under
a Guaranty are secured by substantially all of the assets of such Subsidiary and
(iii) all of the capital stock of the Company is pledged to the Agent, for the
benefit of itself and Lenders, by the Parent as security for the obligations of
the Company hereunder and under the other Loan Documents, (b) to perfect and
maintain the validity, effectiveness and priority of any of the Collateral
Documents and the Liens intended to be created thereby, and (c) to better
assure, convey, grant, assign, transfer, preserve, protect and confirm to the
Agent and the Lenders the rights granted or now or hereafter intended to be
granted to the Agent and the Lenders under any Loan Documents or under any other
document executed in connection therewith. Contemporaneously with the execution
and delivery of any document referred to above, the Company shall, and shall
cause each Subsidiary to, deliver all resolutions, opinions and corporate
documents as the Agent or the Required Lenders may reasonably request to confirm
the enforceability of such document and the perfection of the security interest
created thereby, if applicable.
ARTICLE VIII
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan
or other Obligation shall remain unpaid or unsatisfied, or any Letter of Credit
shall remain outstanding, unless the Required Lenders waive compliance in
writing:
8.1 Limitation on Liens. The Company shall not, and shall not permit any
Subsidiary to, directly or indirectly, make, create, incur, assume or suffer to
exist any Lien upon or with respect to any part of its property, whether now
owned or hereafter acquired, other than the following ("Permitted Liens"):
(a) any Lien existing on property of the Company or any Subsidiary
on the Closing Date and set forth in Schedule 8.1 securing Indebtedness
outstanding on such date;
(b) any Lien created under any Loan Document;
(c) Liens for taxes, fees, assessments or other governmental charges
which are not delinquent or remain payable without penalty, or to the extent
that non-payment thereof is permitted by Section 7.7, provided that no notice of
lien has been filed or recorded under the Code;
-71-
79
(d) carriers', warehousemen's, mechanics', landlords',
materialmen's, repairmen's or other similar Liens arising in the ordinary course
of business which are not delinquent or remain payable without penalty or which
are being contested in good faith and by appropriate proceedings, which
proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto;
(e) Liens (other than any Lien imposed by ERISA) consisting of
pledges or deposits required in the ordinary course of business in connection
with workers' compensation, unemployment insurance and other social security
legislation;
(f) Liens on property of the Company or any Subsidiary securing (i)
the non-delinquent performance of bids, trade contracts (other than for borrowed
money), leases, statutory obligations, (ii) contingent obligations on surety and
appeal bonds, and (iii) other non-delinquent obligations of a like nature, in
each case, incurred in the ordinary course of business; provided that all such
Liens in the aggregate would not (even if enforced) cause a Material Adverse
Effect;
(g) Liens consisting of judgment or judicial attachment Liens,
provided that the enforcement of such Liens is effectively stayed and all such
Liens in the aggregate at any time outstanding for the Company and its
Subsidiaries do not exceed $1,000,000 (excluding the amount of any Lien relating
to judgments covered by insurance maintained with responsible insurance
companies);
(h) easements, rights-of-way, restrictions and other similar
encumbrances incurred in the ordinary course of business which, in the
aggregate, are not substantial in amount, and which do not in any case
materially detract from the value of the property subject thereto or interfere
with the ordinary conduct of the businesses of the Company and its Subsidiaries;
(i) purchase money security interests on any property acquired by
the Company or any Subsidiary in the ordinary course of business, securing
Indebtedness incurred or assumed for the purpose of financing all or any part of
the cost of acquiring such property; provided that (i) any such Lien attaches to
such property concurrently with or within 20 days after the acquisition thereof,
(ii) such Lien attaches solely to the property so acquired in such transaction,
(iii) the principal amount of the Indebtedness secured thereby does not exceed
100% of the cost of such property, and (iv) the principal amount of the
Indebtedness secured by all such purchase money security interests shall not at
any time exceed $1,000,000;
(j) Liens securing obligations in respect of capital leases on
assets subject to such leases, provided that such capital leases are otherwise
permitted hereunder; and
-72-
80
(k) Liens arising solely by virtue of any statutory or common law
provision relating to banker's liens, rights of set-off or similar rights and
remedies as to deposit accounts or other funds maintained with a creditor
depository institution; provided that (i) such deposit account is not a
dedicated cash collateral account and is not subject to restrictions against
access by the Company in excess of those set forth by regulations promulgated by
the FRB, (ii) such deposit account is not intended by the Company or any
Subsidiary to provide collateral to the depository institution and (iii) the
aggregate amount of all such deposits with all depository institutions which are
not Lenders will not at any time exceed $100,000.
8.2 Disposition of Assets. The Company shall not, and shall not permit
any Subsidiary to, directly or indirectly, sell, assign, lease, convey, transfer
or otherwise dispose of (whether in one or a series of transactions) any
property (including accounts and notes receivable, with or without recourse) or
enter into any agreement to do any of the foregoing, except:
(a) dispositions of inventory, or used, worn-out or surplus
equipment, all in the ordinary course of business;
(b) the sale of equipment to the extent that such equipment is
exchanged for credit against the purchase price of similar replacement
equipment, or the proceeds of such sale are reasonably promptly applied to the
purchase price of such replacement equipment; and
(c) dispositions not otherwise permitted hereunder (including the
disposition of all of the capital stock of any operating Subsidiary) which are
made for fair market value; provided that (i) at the time of any disposition, no
Event of Default or Unmatured Event of Default shall exist or will result from
such disposition, and (ii) the proceeds thereof are applied as provided in
Section 2.7.
8.3 Consolidations and Mergers. The Company shall not, and shall not
permit any Subsidiary to, merge or consolidate with or into any other Person,
except that (i) any Subsidiary may merge with the Company, provided that the
Company shall be the continuing or surviving corporation, or with any one or
more Subsidiaries, provided that if any transaction shall be between a
Subsidiary and a Wholly-Owned Subsidiary, the Wholly-Owned Subsidiary shall be
the continuing or surviving corporation and (ii) any operating Subsidiary may
merge or consolidate with any other Person; provided that at the time of any
such merger or consolidation (A) no Event of Default or Unmatured Event of
Default shall exist or result from such merger or consolidation and (B) the
proceeds thereof are applied as provided in Section 2.7.
8.4 Loans and Investments. The Company shall not, and shall not permit
any Subsidiary to, purchase or acquire, or make any
-73-
81
commitment therefor, any capital stock, equity interest, or other obligations or
securities of, or any interest in, any other Person, or make or commit to make
any Acquisition, or make or commit to make any advance, loan, extension of
credit or capital contribution to or any other investment in, any other Person,
except for:
(a) investments in Cash Equivalent Investments;
(b) extensions of credit in the nature of accounts receivable or
notes receivable arising from the sale or lease of goods or services in the
ordinary course of business;
(c) investments by the Company in its Subsidiaries or by any
Subsidiary in any other Subsidiary, in the form of contributions to capital or
loans or advances; provided that, immediately before and after giving effect to
such investment, no Event of Default or Unmatured Event of Default shall have
occurred and be continuing and the aggregate amount invested in Foreign
Subsidiaries after the Closing Date shall not exceed $3,000,000;
(d) loans or advances made by any Subsidiary to the Company;
(e) loans and advances to employees in the ordinary course of
business (such as travel advances) in an aggregate amount not at any time
exceeding $500,000;
(f) investments by the Company and its Subsidiaries in Joint
Ventures in the form of contributions of capital, loans, advances or Contingent
Obligations; provided, that, immediately before and giving effect to such
investment, no Event of Default or Unmatured Event of Default shall have
occurred and be continuing, including, without limitation pursuant to Section
8.9;
(g) investments constituting Permitted Swap Obligations or payments
or advances under Swap Contracts relating to Permitted Swap Obligations; and
(h) other investments in an aggregate amount not exceeding $500,000
during the term of this Agreement; provided, however, that for purposes of
determining the aggregate amount of investments hereunder, (x) any payment of
interest, return of principal or return of equity received in cash on any
investment made hereunder and (y) the fair market value of any other property
received in exchange for any investment made hereunder, shall be deducted and;
provided, further, no such investment shall be made in a Foreign Subsidiary.
8.5 Limitation on Indebtedness. The Company shall not, and shall not
permit any Subsidiary to, create, incur, assume, suffer
-74-
82
to exist, or otherwise become or remain directly or indirectly liable with
respect to, any Indebtedness, except:
(a) Indebtedness incurred pursuant to this Agreement;
(b) Indebtedness consisting of Contingent Obligations permitted
pursuant to Section 8.8;
(c) Indebtedness existing on the Closing Date and set forth in
Schedule 8.5;
(d) Indebtedness of Subsidiaries to the Company or other
Subsidiaries; provided, that the aggregate amount of all such Indebtedness of
Foreign Subsidiaries and other investments by the Company and its Subsidiaries
in Foreign Subsidiaries shall not exceed $3,000,000;
(e) Indebtedness secured by Liens permitted by subsection 8.1(i);
(f) Indebtedness incurred in connection with leases permitted
pursuant to Section 8.10;
(g) Indebtedness of Fiberite Europe GmbH for working capital
purposes, in an aggregate amount not at any time exceeding $5,000,000; and
(h) other Indebtedness in an aggregate amount not at any time
exceeding $1,000,000; provided, that such Indebtedness shall not be incurred by
a Foreign Subsidiary.
It is understood that any Indebtedness borrowed in a foreign currency shall
continue to be permitted under this Section, notwithstanding any fluctuation in
the Dollar Amount of such Indebtedness, as long as the outstanding principal
balance of such Indebtedness (denominated in its original currency) does not
exceed the maximum amount of such Indebtedness (denominated in such currency)
permitted to be outstanding on the date such Indebtedness was incurred.
8.6 Transactions with Affiliates. The Company shall not, and shall not
permit any Subsidiary to, enter into any transaction with any Affiliate of the
Company (other than a Subsidiary), except upon fair and reasonable terms no less
favorable to the Company or such Subsidiary than would be obtainable in a
comparable arm's-length transaction with a Person not an Affiliate of the
Company; provided that so long as no Event of Default or Unmatured Event of
Default exists or would result therefrom, the Company (i) may make regularly
scheduled payments of management fees pursuant to the Shareholder Agreement as
in effect on the date hereof, (ii) may make any payments permitted by Section
8.16 and (iii) may pay DLJMB for investment banking services as contemplated by
Section 7.4 of the Shareholder Agreement.
-75-
83
8.7 Use of Proceeds. The Company shall not, and shall not permit any
Subsidiary to, use any portion of the Loan proceeds or any Letter of Credit,
directly or indirectly, (i) to purchase or carry Margin Stock, (ii) to repay or
otherwise refinance indebtedness of the Company or others incurred to purchase
or carry Margin Stock, or (iii) to extend credit for the purpose of purchasing
or carrying any Margin Stock.
8.8 Contingent Obligations. The Company shall not, and shall not permit
any Subsidiary to, create, incur, assume or suffer to exist any Contingent
Obligation except:
(a) endorsements for collection or deposit in the ordinary course of
business;
(b) Permitted Swap Obligations;
(c) Contingent Obligations of the Company and its Subsidiaries
existing as of the Closing Date and listed in Schedule 8.8;
(d) Contingent Obligations arising under the Loan Documents; and
(e) Contingent Obligations with respect to Joint Ventures to the
extent permitted by Section 8.9.
8.9 Joint Ventures. The Company shall not, and shall not permit any
Subsidiary to, enter into any Joint Venture, except that the Company or any
Subsidiary may enter into any Joint Venture so long as the aggregate amount
invested by the Company and its Subsidiaries in all Joint Ventures in any form
(including without limitation by capital contribution, incurrence of
Indebtedness by any such Joint Venture to the Company or any Subsidiary or the
incurrence of Contingent Obligations by the Company or any Subsidiary with
respect to any such Joint Venture), during the term of this Agreement does not
exceed $5,000,000; provided, however, that for purposes of determining the
aggregate amount invested in Joint Ventures hereunder, (x) any return of
principal or equity received in cash on any amount invested hereunder and (y)
the fair market value of any other property received in exchange for any amount
invested hereunder, shall be deducted.
8.10 Lease Obligations. The Company shall not, and shall not permit any
Subsidiary to, create or suffer to exist any obligations for the payment of rent
for any property under lease or agreement to lease, except for:
(a) leases of the Company and its Subsidiaries in existence on the
Closing Date and any renewal, extension or refinancing thereof;
-76-
84
(b) operating leases entered into by the Company or any Subsidiary
after the Closing Date in the ordinary course of business; and
(c) capital leases entered into by the Company to finance the
acquisition of equipment; provided that no Event of Default or Unmatured Event
of Default has occurred and is continuing or will result from the incurrence of
the obligations of the Company contemplated thereby.
8.11 Minimum Fixed Charge Coverage. The Company will not permit the
Fixed Charge Coverage Ratio for any Computation Period to be less than the ratio
set forth below opposite the period in which such Computation Period ends:
Period Ratio
------ -----
March 31, 1996 through September 30, 1997 1.00 to 1
December 31, 1997 through September 30, 1998 1.05 to 1
December 31, 1998 through September 30, 1999 1.10 to 1
Thereafter 1.15 to 1
8.12 Minimum Interest Coverage. The Company will not permit the
Interest Coverage Ratio for any Computation Period to be less than the ratio set
forth below opposite the period in which such Computation Period ends:
Period Ratio
------ -----
March 31, 1996 and June 30, 1996 2.25 to 1
September 30, 1996 and December 31, 1996 2.50 to 1
March 31, 1997 through September 30, 1997 2.75 to 1
December 31, 1997 through September 30, 1998 3.00 to 1
December 31, 1998 through September 30, 1999 3.50 to 1
Thereafter 4.00 to 1
8.13 Maximum Leverage. The Company will not permit the Leverage Ratio
at any time to exceed the following ratios during the following periods:
Period Ratio
------ -----
June 30, 1996 through December 30, 1996 4.00 to 1
December 31, 1996 through March 30, 1997 3.75 to 1
March 31, 1997 through September 30, 1997 3.50 to 1
December 31, 1997 through September 30, 1998 3.25 to 1
December 31, 1998 through September 30, 1999 2.75 to 1
December 31, 1999 through September 30, 2000 2.25 to 1
Thereafter 2.00 to 1
8.14 Minimum Net Worth. The Company will not permit its Net Worth at
any time to be less than the following amounts during the following periods:
-77-
85
Fiscal Year Amount
----------- ------
January 1, 1996 through December 31, 1996 $30,000,000
January 1, 1997 through December 31, 1997 $35,000,000
January 1, 1998 through December 31, 1998 $40,000,000
January 1, 1999 through December 31, 1999 $45,000,000
January 1, 2000 through December 31, 2000 $50,000,000
January 1, 2001 through December 31, 2001 $60,000,000
8.15 Maximum Capital Expenditures. The Company will not permit the
aggregate amount of all Capital Expenditures (other than MIS Expenditures) made
by the Company and its Subsidiaries for any fiscal year, to exceed the amount
set forth below opposite such fiscal year:
Fiscal Year Amount
----------- ------
1996 $5,000,000
1997 $5,000,000
1998 $6,000,000
1999 $6,000,000
2000 $6,000,000
2001 $6,000,000
8.16 Restricted Payments. The Company shall not, and shall not permit
any Subsidiary to, declare or make any dividend payment or other distribution of
assets, properties, cash, rights, obligations or securities on account of any
shares of any class of its capital stock, or purchase, redeem or otherwise
acquire for value any shares of its capital stock or any warrants, rights or
options to acquire such shares, now or hereafter outstanding, except that:
(a) any Subsidiary may declare and pay dividends to the Company;
(b) the Company may declare and make dividend payments or other
distributions payable in its common stock;
(c) so long as no Event of Default or Unmatured Event of Default
has occurred and is continuing or will result therefrom, the Company may make
payments to the Parent to enable Parent to repurchase or redeem common stock
pursuant to Article 4 of the Shareholder Agreement in effect on the date hereof;
(d) so long as no Event of Default or Unmatured Event of Default
has occurred and is continuing or will result therefrom, the Company may make
payments to the Parent to the extent of reasonable out-of-pocket expenses
incurred by the Parent specifically related to the Company or the Parent's
ownership of the Company (including, without limitation, accounting fees
relating to the financial statements of the Company or the Parent, directors
fees, and legal expenses relating to the ownership of the Company); and
-78-
86
(e) so long as no Event of Default has occurred and is continuing
or will result therefrom, the Company may make payments to the Parent as
contemplated by the Tax Sharing Agreement.
8.17 ERISA. The Company shall not, and shall not permit any of its
Subsidiaries to: (a) engage in prohibited transactions or violations of the
fiduciary responsibility rules with respect to one or more Plans which have
resulted or would reasonably be expected to result in liability of the Company
in an aggregate amount in excess of $2,000,000 at any time; or (b) engage in
transactions that could be subject to Section 4069 or 4212(c) of ERISA and which
has resulted or would reasonably be expected to result in an outstanding
liability of the Company in an aggregate amount in excess of $2,000,000 at any
time.
8.18 Change in Business. The Company shall not, and shall not permit any
Subsidiary to, engage in any material line of business substantially different
from those lines of business carried on by the Company and its Subsidiaries on
the date hereof.
8.19 Amendments to Certain Documents. The Company shall not make or
agree to any amendment to or modification of, or waive any of its rights under,
any of the terms of (a) the Purchase Agreements, (b) the Shareholder Agreement
or (c) the Transition Services Agreements in a manner materially adverse to the
Lenders.
8.20 Accounting Changes. The Company shall not, and shall not permit any
Subsidiary to, make any significant change in accounting treatment or reporting
practices, except as required by GAAP, or change the fiscal year of the Company
or of any Subsidiary.
ARTICLE IX
EVENTS OF DEFAULT
9.1 Event of Default. Any of the following shall constitute an "Event
of Default":
(a) Non-Payment. The Company fails to pay (i) when and as required
to be paid herein, any amount of principal of any Loan or of any L/C Obligation,
or, (ii) within one Business Day after the same becomes due, any amount of
interest or (iii) within five Business Days after the same becomes due, any fees
or other amounts payable hereunder or under any other Loan Document.
(b) Representation or Warranty. Any representation or warranty by
the Company, the Parent or any Subsidiary made or deemed made herein or in any
other Loan Document, or which is contained in any certificate, document or
financial or other
-79-
87
statement by the Company, the Parent, any Subsidiary or any Responsible Officer
furnished at any time under this Agreement or any other Loan Document, is
incorrect in any material respect on or as of the date made or deemed made.
(c) Specific Defaults. The Company fails to perform or observe any
term, covenant or agreement contained in any of Section 7.3 or Article VIII.
(d) Other Defaults. The Company or any Subsidiary party thereto
fails to perform or observe any other term or covenant contained in this
Agreement or any other Loan Document, and such default shall continue unremedied
for a period of 30 days after the earlier of (i) the date upon which a
Responsible Officer knew or reasonably should have known of such failure or (ii)
the date upon which written notice thereof is given to the Company by the Agent
or any Lender.
(e) Cross-Default. (i) The Company or any Subsidiary (A) fails to
make any payment in respect of any Indebtedness or Contingent Obligation (other
than in respect of Swap Contracts) having an aggregate principal amount
(including amounts owing to all creditors under any combined or syndicated
credit arrangement) of more than $1,000,000 when due (whether by scheduled
maturity, required prepayment, acceleration, demand, or otherwise but subject to
any applicable grace period); or (B) fails to perform or observe any other
condition or covenant, or any other event shall occur or condition shall exist,
under any agreement or instrument relating to any such Indebtedness or
Contingent Obligation, if the effect of such failure, event or condition is to
cause, or to permit the holder or holders of such Indebtedness or beneficiary or
beneficiaries of such Indebtedness (or a trustee or agent on behalf of such
holder or holders or beneficiary or beneficiaries) to cause, such Indebtedness
to be declared to be due and payable prior to its stated maturity, or such
Contingent Obligation to become payable, or cash collateral in respect thereof
to be demanded or (ii) there occurs under any Swap Contract an Early Termination
Date (as defined in such Swap Contract) resulting from (A) any event of default
under such Swap Contract as to which the Company or any Subsidiary is the
Defaulting Party (as defined in such Swap Contract) or (B) any Termination Event
(as so defined) as to which the Company or any Subsidiary is an Affected Party
(as so defined), and, in either event, the Swap Termination Value owed by the
Company or such Subsidiary as a result thereof is greater than $1,000,000.
(f) Insolvency; Voluntary Proceedings. The Company, the Parent or
any Subsidiary (i) ceases or fails to be solvent, or generally fails to pay, or
admits in writing its inability to pay, its debts as they become due; (ii)
voluntarily ceases to conduct its business in the ordinary course; (iii)
commences any Insolvency Proceeding with respect to itself; or (iv) takes any
action to effectuate or authorize any of the foregoing.
-80-
88
(g) Involuntary Proceedings. (i) Any involuntary Insolvency
Proceeding is commenced or filed against the Company, the Parent or any
Subsidiary, or any writ, judgment, warrant of attachment, warrant of execution
or similar process is issued or levied against a substantial part of the
Company's or any Subsidiary's properties, and such proceeding or petition shall
not be dismissed, or such writ, judgment, warrant of attachment, warrant of
execution or similar process shall not be released, vacated or fully bonded
within 60 days after commencement, filing or levy; (ii) the Company, the Parent
or any Subsidiary admits the material allegations of a petition against it in
any Insolvency Proceeding, or an order for relief (or similar order under
non-U.S. law) is ordered in any Insolvency Proceeding; or (iii) the Company, the
Parent or any Subsidiary acquiesces in the appointment of a receiver, trustee,
custodian, conservator, liquidator, mortgagee in possession (or agent therefor)
or other similar Person for itself or a substantial portion of its property or
business.
(h) ERISA. (i) one or more ERISA Events shall occur with respect to
a Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in an outstanding liability of the Company under Title IV of
ERISA to the Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount
in excess of $2,000,000 at any time; (ii) a contribution failure shall have
occurred with respect to a Pension Plan sufficient to give rise to a Lien under
Section 302(f) of ERISA; or (iii) the Company or any ERISA Affiliate shall fail
to pay when due, after the expiration of any applicable grace period, one or
more installment payments with respect to its withdrawal liability under Section
4201 of ERISA under a Multiemployer Plan which results in an aggregate
withdrawal liability in excess of $2,000,000 at any time.
(i) Monetary Judgments. One or more non-interlocutory judgments,
non-interlocutory orders, decrees or arbitration awards is entered against the
Company or any Subsidiary involving in the aggregate a liability (to the extent
not covered by independent third-party insurance as to which the insurer does
not dispute coverage), as to any single or related series of transactions,
incidents or conditions, of $250,000 or more, and the same shall remain
undischarged, unvacated and unstayed pending appeal for a period of 30 days
after the entry thereof.
(j) Non-Monetary Judgments. Any non-monetary judgment, order or
decree is entered against the Company or any Subsidiary which has or would
reasonably be expected to have a Material Adverse Effect, and there shall be any
period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect.
(k) Change of Control. Any Change of Control occurs.
-81-
89
(l) Guarantor Defaults. The Guaranty shall cease to be in full force
and effect with respect to any Guarantor (other than as expressly permitted
hereunder), any Guarantor shall fail (subject to any applicable grace period) to
comply with or to perform any applicable provision of the Guaranty, or any
Guarantor (or any Person by, through or on behalf of such Guarantor) shall
contest in any manner the validity, binding nature or enforceability of the
Guaranty with respect to such Guarantor.
(m) Collateral Documents, etc. Any Collateral Document shall cease
to be in full force and effect with respect to the Company or any Guarantor
(other than as expressly permitted hereunder), the Company or any Guarantor
shall fail (subject to any applicable grace period) to comply with or to perform
any applicable provision of any Collateral Document, or the Company or any
Guarantor (or any Person by, through or on behalf of the Company or any
Guarantor) shall contest in any manner the validity, binding nature or
enforceability of any Collateral Document.
9.2 Remedies. If any Event of Default occurs, the Agent shall, at the
request of, or may, with the consent of, the Required Lenders do any or all of
the following:
(a) declare the commitment of each Lender to make Loans and any
obligation of each Issuing Lender to Issue Letters of Credit to be terminated,
whereupon such commitments and obligations shall be terminated;
(b) declare an amount equal to the maximum aggregate amount that is
or at any time thereafter may become available for drawing under any outstanding
Letter of Credit (whether or not any beneficiary shall have presented, or shall
be entitled at such time to present, the drafts or other documents required to
draw under such Letter of Credit) to be immediately due and payable, and declare
the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly
waived by the Company; and
(c) exercise on behalf of itself and the Lenders all rights and
remedies available to it and the Lenders under the Loan Documents or applicable
law;
provided, however, that upon the occurrence of any Event of Default specified in
subsection 9.1(f) or (g), the obligation of each Lender to make Loans and the
obligation of each Issuing Lender to Issue Letters of Credit shall automatically
terminate and the unpaid principal amount of all outstanding Loans and all
interest and other amounts as aforesaid shall automatically
-82-
90
become due and payable without further act of the Agent, any Issuing Lender or
any other Lender.
9.3 Rights Not Exclusive. The rights provided for in this Agreement and
the other Loan Documents are cumulative and are not exclusive of any other
rights, powers, privileges or remedies provided by law or in equity, or under
any other instrument, document or agreement now existing or hereafter arising.
ARTICLE X
THE AGENT
10.1 Appointment and Authorization. (a) Each Lender hereby irrevocably
(subject to Section 10.9) appoints, designates and authorizes the Agent to take
such action on its behalf under the provisions of this Agreement and each other
Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere in this
Agreement or in any other Loan Document, the Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall the Agent
have or be deemed to have any fiduciary relationship with any Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Loan Document or
otherwise exist against the Agent.
(b) Each Issuing Lender shall act on behalf of the Lenders with
respect to any Letters of Credit Issued by it and the documents associated
therewith until such time and except for so long as the Agent may agree at the
request of the Required Lenders to act for such Issuing Lender with respect
thereto; provided, however, that each Issuing Lender shall have all of the
benefits and immunities (i) provided to the Agent in this Article X with respect
to any acts taken or omissions suffered by such Issuing Lender in connection
with Letters of Credit Issued by it or proposed to be Issued by it and the
applications and agreements for letters of credit pertaining to the Letters of
Credit as fully as if the term "Agent", as used in this Article X, included such
Issuing Lender with respect to such acts or omissions, and (ii) as additionally
provided in this Agreement with respect to such Issuing Lender.
10.2 Delegation of Duties. The Agent may execute any of its duties under
this Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel concerning all
matters pertaining to such duties. The Agent shall not be responsible for the
negligence or misconduct of any agent or attorney-in-fact that it selects with
reasonable care.
-83-
91
10.3 Liability of Agent. None of the Agent-Related Persons shall (a) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct),
or (b) be responsible in any manner to any of the Lenders for any recital,
statement, representation or warranty made by the Company or any Subsidiary or
Affiliate of the Company, or any officer thereof, contained in this Agreement or
in any other Loan Document, 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 any other Loan Document, or the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Loan Document, or for any failure of the Company or any other party to
any Loan Document to perform its obligations hereunder or thereunder. No
Agent-Related Person shall 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 any other Loan Document, or to
inspect the properties, books or records of the Company or any of the Company's
Subsidiaries or Affiliates.
10.4 Reliance by Agent. (a) The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any writing, resolution, notice,
consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone
message, statement 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 counsel
to the Company), independent accountants and other experts selected by the
Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, 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. The
Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a
request or consent of the Required Lenders and such request and any action taken
or failure to act pursuant thereto shall be binding upon all of the Lenders.
(b) For purposes of determining compliance with the conditions
specified in Sections 5.1 and 5.2, each Lender that has executed this Agreement
shall be deemed to have consented to, approved or accepted, or to be satisfied
with, each document or other matter either sent by the Agent to such Lender for
consent, approval, acceptance or satisfaction, or required thereunder to be
consented to or approved by or acceptable or satisfactory to such Lender.
-84-
92
10.5 Notice of Default. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Event of Default or Unmatured Event
of Default, except with respect to defaults in the payment of principal,
interest and fees required to be paid to the Agent for the account of the
Lenders, unless the Agent shall have received written notice from a Lender or
the Company referring to this Agreement, describing such Event of Default or
Unmatured Event of Default and stating that such notice is a "notice of
default". The Agent will notify the Lenders of its receipt of any such notice.
The Agent shall take such action with respect to such Event of Default or
Unmatured Event of Default as may be requested by the Required Lenders in
accordance with Article IX; provided, however, that unless and until the Agent
has received any such request, the Agent may (but shall not be obligated to)
take such action, or refrain from taking such action, with respect to such Event
of Default or Unmatured Event of Default as it shall deem advisable or in the
best interest of the Lenders.
10.6 Credit Decision. Each Lender acknowledges that none of the
Agent-Related Persons has made any representation or warranty to it, and that no
act by the Agent hereinafter taken, including any review of the affairs of the
Company and its Subsidiaries, shall be deemed to constitute any representation
or warranty by any Agent-Related Person to any Lender. Each Lender represents to
the Agent that it has, independently and without reliance upon any Agent-Related
Person and based on such documents and information as it has deemed appropriate,
made its own appraisal of and investigation into the business, prospects,
operations, property, financial and other condition and creditworthiness of the
Company and its Subsidiaries, and all applicable bank regulatory laws relating
to the transactions contemplated hereby, and made its own decision to enter into
this Agreement and to extend credit to the Company hereunder. Each Lender also
represents that it will, independently and without reliance upon any
Agent-Related Person 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 investigations as it deems necessary
to inform itself as to the business, prospects, operations, property, financial
and other condition and creditworthiness of the Company. Except for notices,
reports and other documents expressly herein required to be furnished to the
Lenders by the Agent, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the business,
prospects, operations, property, financial and other condition or
creditworthiness of the Company which may come into the possession of any of the
Agent-Related Persons.
10.7 Indemnification of Agent. Whether or not the transactions
contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Agent-Related Persons (to the
-85-
93
extent not reimbursed by or on behalf of the Company and without limiting the
obligation of the Company to do so), pro rata, from and against any and all
Indemnified Liabilities; provided, however, that no Lender shall be liable for
the payment to any Agent-Related Person of any portion of the Indemnified
Liabilities resulting solely from such Person's gross negligence or willful
misconduct. Without limitation of the foregoing, each Lender shall reimburse the
Agent upon demand for its ratable share of any costs or out-of-pocket expenses
(including Attorney Costs) incurred by the Agent in connection with the
preparation, execution, delivery, administration, modification, amendment or
enforcement (whether through negotiations, legal proceedings or otherwise) of,
or legal advice in respect of rights or responsibilities under, this Agreement,
any other Loan Document, or any document contemplated by or referred to herein,
to the extent that the Agent is not reimbursed for such expenses by or on behalf
of the Company. The undertaking in this Section shall survive the payment of all
Obligations hereunder and the resignation or replacement of the Agent.
10.8 Agent in Individual Capacity. BofA and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with the Company and its
Subsidiaries and Affiliates as though BofA were not the Agent hereunder and
without notice to or consent of the Lenders. The Lenders acknowledge that,
pursuant to such activities, BofA or its Affiliates may receive information
regarding the Company or its Affiliates (including information that may be
subject to confidentiality obligations in favor of the Company or such
Subsidiary) and acknowledge that the Agent shall be under no obligation to
provide such information to them. With respect to its Loans, BofA and any
Affiliate thereof shall have the same rights and powers under this Agreement as
any other Lender and may exercise the same as though BofA were not the Agent.
10.9 Successor Agent. The Agent may, and at the request of the
Required Lenders shall, resign as Agent upon 30 days' notice to the Lenders. If
the Agent resigns under this Agreement, the Required Lenders shall appoint, with
the consent of the Company which shall not be unreasonably withheld, from among
the Lenders a successor agent for the Lenders. If no successor agent is
appointed prior to the effective date of the resignation of the Agent, the Agent
may appoint, after consulting with the Lenders and the Company, a successor
agent from among the Lenders. Upon the acceptance of its appointment as
successor agent hereunder, such successor agent shall succeed to all the rights,
powers and duties of the retiring Agent and the term "Agent" shall mean such
successor agent and the retiring Agent's appointment, powers and duties as Agent
shall be terminated. After any retiring Agent's resignation hereunder as Agent,
the provisions of this Article X and Sections 11.4 and 11.5 shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
-86-
94
under this Agreement. If no successor agent has accepted appointment as Agent by
the date which is 30 days following a retiring Agent's notice of resignation,
the retiring Agent's resignation shall nevertheless thereupon become effective
and the Lenders shall perform all of the duties of the Agent hereunder until
such time, if any, as the Required Lenders appoint a successor agent as provided
for above. Notwithstanding the foregoing, however, BofA may not be removed as
the Agent at the request of the Required Lenders unless BofA and any Affiliate
thereof acting as an Issuing Lender hereunder shall also simultaneously be
replaced as an Issuing Lender pursuant to documentation in form and substance
reasonably satisfactory to BofA (and, if applicable, such Affiliate).
10.10 Withholding Tax. (a) If any Lender is a "foreign corporation,
partnership or trust" within the meaning of the Code and such Lender claims
exemption from, or a reduction of, U.S. withholding tax under Section 1441 or
1442 of the Code, such Lender shall deliver to the Agent and the Company:
(i) if such Lender claims an exemption from, or a reduction
of, withholding tax under a United States tax treaty, properly
completed IRS Forms 1001 and W-8 before the payment of any interest in
the first calendar year and before the payment of any interest in each
third succeeding calendar year during which interest may be paid under
this Agreement;
(ii) if such Lender claims that interest paid under this
Agreement is exempt from United States withholding tax because it is
effectively connected with a United States trade or business of such
Lender, two properly completed and executed copies of IRS Form 4224
before the payment of any interest is due in the first taxable year of
such Lender and in each succeeding taxable year of such Lender during
which interest may be paid under this Agreement, and IRS Form W-9; and
(iii) such other form or forms as may be required under the
Code or other laws of the United States as a condition to exemption
from, or reduction of, United States withholding tax.
Each such Lender agrees to promptly notify the Agent and the Company of any
change in circumstances which would modify or render invalid any claimed
exemption or reduction.
(b) If any Lender claims exemption from, or reduction of,
withholding tax under a United States tax treaty by providing IRS Form 1001 and
such Lender sells, assigns, grants a participation in, or otherwise transfers
all or part of the Obligations of the Company to such Lender, such Lender agrees
to notify the Agent and the Company of the percentage amount in which it is no
longer the beneficial owner of Obligations of the Company to such Lender. To the
extent of such percentage amount,
-87-
95
the Agent and the Company will treat such Lender's IRS Form 1001 as no longer
valid.
(c) If any Lender claiming exemption from United States withholding
tax by filing IRS Form 4224 with the Agent and the Company sells, assigns,
grants a participation in, or otherwise transfers all or part of the Obligations
of the Company to such Lender, such Lender agrees to undertake sole
responsibility for complying with the withholding tax requirements imposed by
Sections 1441 and 1442 of the Code.
(d) If any Lender is entitled to a reduction in the applicable
withholding tax, the Agent or the Company may withhold from any interest payment
to such Lender an amount equivalent to the applicable withholding tax after
taking into account such reduction. If the forms or other documentation required
by subsection (a) of this Section are not timely delivered to the Agent and the
Company, then the Agent or the Company may withhold from any interest payment to
such Lender not providing such forms or other documentation an amount equivalent
to the applicable withholding tax.
(e) If the IRS or any other Governmental Authority of the United
States or other jurisdiction asserts a claim that the Agent or the Company did
not properly withhold tax from amounts paid to or for the account of any Lender
(because the appropriate form was not delivered or was not properly executed, or
because such Lender failed to notify the Agent of a change in circumstances
which rendered the exemption from, or reduction of, withholding tax ineffective,
or for any other reason) such Lender shall indemnify the Agent and the Company
fully for all amounts paid, directly or indirectly, by the Agent or the Company
as Tax or otherwise, including penalties and interest, and including any Taxes
imposed by any jurisdiction on the amounts payable to the Agent or the Company
under this Section, together with all costs and expenses (including Attorney
Costs). The obligation of the Lenders under this subsection shall survive the
payment of all Obligations and the resignation or replacement of the Agent.
10.11 Collateral Matters.
(a) The Agent is authorized on behalf of all the Lenders; without
the necessity of any notice to or further consent from the Lenders, from time to
time to take any action with respect to any collateral or the Collateral
Documents which may be necessary to perfect and maintain perfected the security
interest in and Liens upon the collateral granted pursuant to the Collateral
Documents.
(b) The Lenders irrevocably authorize the Agent, at its option and
in its discretion, to release any Lien granted to or held by the Agent upon any
collateral (i) upon termination of the Commitments and payment in full of all
Loans and all other obligations known to the Agent and payable under this
Agreement
-88-
96
or any other Loan Document; (ii) constituting property sold or to be
sold or disposed of as part of or in connection with any disposition permitted
hereunder; (iii) constituting property in which the Company or any Subsidiary
owned no interest at the time the Lien was granted or at any time thereafter;
(iv) constituting property leased to the Company or any Subsidiary under a lease
which has expired or been terminated in a transaction permitted under this
Agreement or is about to expire and which has not been, and is not intended by
the Company or such Subsidiary to be, renewed or extended; (v) consisting of an
instrument evidencing Indebtedness or other debt instrument, if the indebtedness
thereby has been paid in full; or (vi) if approved, authorized or ratified in
writing by the Required Lenders or all the Lenders. Upon request by the Agent at
any time, the Lenders will confirm in writing the Agent's authority to release
particular types or items of Collateral pursuant to this subsection 10.11(b).
(c) Each Lender agrees with and in favor of each other (which
agreement shall not be for the benefit of the Company or any Subsidiary) that
any security interest in real property collateral received by a Lender in
connection with the extension of any loan or financial commitment between such
Lender and the Company or any of its Affiliates and not related to the
transactions contemplated hereby shall not constitute collateral for the
Company's obligations under this Agreement or any other Loan Document.
ARTICLE XI
MISCELLANEOUS
11.1 Amendments and Waivers. No amendment or waiver of any provision of
this Agreement or any other Loan Document, and no consent with respect to any
departure by the Company therefrom, shall be effective unless the same shall be
in writing and signed by the Required Lenders and the Company and acknowledged
by the Agent, and then any such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given; provided that:
(a) no such waiver, amendment or consent shall, unless in writing
and signed by all Lenders and the Company and acknowledged by the Agent, do any
of the following:
(i) increase or extend any Commitment of any Lender (or
reinstate any Commitment terminated pursuant to Section 9.2);
(ii) postpone or delay any date fixed by this Agreement or any
other Loan Document for any payment of principal (including any
mandatory prepayment to Section 2.7), interest, fees or other amounts
due to the Lenders (or any of them) hereunder or under any other Loan
Document;
-89-
97
(iii) reduce the principal of, or the rate of interest
specified herein on, any Loan or (subject to clause (e) below) reduce
any fees payable hereunder or under any other Loan Document;
(iv) change the aggregate percentage of the Total Percentage
which is required for the Lenders or any of them to take any action
hereunder; or
(v) amend this Section, or Section 2.14, or any provision
herein providing for consent or other action by all Lenders;
(b) after the making of the Term Loans, Section 2.3, 2.4, 2.5, 2.6
(as it relates to an optional prepayment of Revolving Loans), 2.8(c) or Article
III may be amended, or the rights or privileges thereunder waived, with the
written consent of the Required Revolving Lenders, the Company and the
acknowledgment of the Agent;
(c) no amendment, waiver or consent shall, unless in writing and
signed by the applicable Issuing Lender in addition to the Required Lenders or
all Lenders, as the case may be, affect the rights or duties of any Issuing
Lender under this Agreement or any L/C-Related Document relating to any Letter
of Credit Issued or to be Issued by it;
(d) no amendment, waiver or consent shall, unless in writing and
signed by the Agent in addition to the Required Lenders or all Lenders, as the
case may be, affect the rights or duties of the Agent under this Agreement or
any other Loan Document; and
(e) the Fee Letter may be amended, or rights or privileges
thereunder waived, in writing executed by the parties thereto.
11.2 Notices. (a) All notices, requests and other communications
hereunder shall be in writing (including, unless the context expressly otherwise
provides, by facsimile transmission, provided that any matter transmitted by the
Company by facsimile (i) shall be immediately confirmed by a telephone call to
the recipient at the number specified on Schedule 11.2, and (ii) shall be
followed promptly by delivery of a hard copy original thereof) and mailed, faxed
or delivered to the address or facsimile number specified for notices on
Schedule 11.2; or, as directed to the Company or the Agent, to such other
address as shall be designated by such party in a written notice to the other
parties, and as directed to any other party, at such other address as shall be
designated by such party in a written notice to the Company and the Agent.
(b) All such notices, requests and communications shall, when
transmitted by overnight delivery, or faxed, be
-90-
98
effective when delivered, or transmitted in legible form by facsimile machine,
respectively, or if mailed, upon the third Business Day after the date deposited
into the U.S. mail; except that notices to the Agent pursuant to Article II, III
or X shall not be effective until actually received by the Agent, and notices
pursuant to Article III to any Issuing Lender shall not be effective until
actually received by such Issuing Lender at the address specified for such
"Issuing Lender" on Schedule 11.2.
(c) Any agreement of the Agent and the Lenders herein to receive
certain notices by telephone or facsimile is solely for the convenience and at
the request of the Company. The Agent and the Lenders shall be entitled to rely
on the authority of any Person purporting to be a Person authorized by the
Company to give such notice and the Agent and the Lenders shall not have any
liability to the Company or other Person on account of any action taken or not
taken by the Agent or the Lenders in reliance upon such telephonic or facsimile
notice. The obligation of the Company to repay the Loans and L/C Obligations
shall not be affected in any way or to any extent by any failure of the Agent
and the Lenders to receive written confirmation of any telephonic or facsimile
notice or the receipt by the Agent and the Lenders of a confirmation which is at
variance with the terms understood by the Agent and the Lenders to be contained
in the telephonic or facsimile notice.
11.3 No Waiver; Cumulative Remedies. No failure to exercise and no delay
in exercising, on the part of the Agent or any Lender, any right, remedy, power
or privilege hereunder shall operate as a waiver thereof; nor shall any single
or partial exercise of any right, remedy, power or privilege hereunder preclude
any other or further exercise thereof or the exercise of any other right,
remedy, power or privilege.
11.4 Costs and Expenses. The Company shall:
(a) whether or not the transactions contemplated hereby are
consummated, pay or reimburse the Agent and the Arranger within five Business
Days after demand (subject to subsection 5.1(g)) for all costs and expenses
incurred by the Agent and the Arranger in connection with the development,
preparation, delivery, administration and execution of, and any amendment,
supplement, waiver or modification to (in each case, whether or not
consummated), this Agreement, any Loan Document and any other document prepared
in connection herewith or therewith, and the consummation of the transactions
contemplated hereby and thereby, including Attorney Costs incurred by the Agent
and the Arranger with respect thereto; and
(b) pay or reimburse the Agent and each Lender within five Business
Days after demand (subject to subsection 5.1(g)) for all costs and expenses
(including Attorney Costs) incurred by them in connection with the enforcement,
attempted enforcement, or preservation of any right or remedy under this
Agreement or
-91-
99
any other Loan Document during the existence of an Event of Default or after
acceleration of the Loans (including in connection with any "workout" or
restructuring regarding the Loans, and including in any Insolvency Proceeding or
appellate proceeding).
11.5 Company Indemnification. Whether or not the transactions
contemplated hereby are consummated, the Company shall indemnify and hold the
Agent-Related Persons and each Lender and each of their respective officers,
directors, employees, counsel, agents and attorneys-in-fact (each an
"Indemnified Person") harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
charges, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time (including, at any time following
repayment of the Loans, the termination of the Letters of Credit and the
termination, resignation or replacement of the Agent or replacement of any
Lender) be imposed on, incurred by or asserted against any such Person in any
way relating to or arising out of this Agreement or any document contemplated by
or referred to herein, or the transactions contemplated hereby or thereby, or
any action taken or omitted by any such Person under or in connection with any
of the foregoing, including with respect to any investigation, litigation or
proceeding (including any Insolvency Proceeding or appellate proceeding) related
to or arising out of this Agreement or the Loans or Letters of Credit or the use
of the proceeds thereof, whether or not any Indemnified Person is a party
thereto (all the foregoing, collectively, the "Indemnified Liabilities");
provided that the Company shall have no obligation hereunder to any Indemnified
Person with respect to Indemnified Liabilities resulting solely from the gross
negligence or willful misconduct of such Indemnified Person. The agreements in
this Section shall survive payment of all other Obligations.
11.6 Payments Set Aside. To the extent that the Company makes a
payment to the Agent or the Lenders, or the Agent or the Lenders exercise their
right of set-off, and such payment or the proceeds of such set-off or any part
thereof is subsequently invalidated, declared to be fraudulent or preferential,
set aside or required (including pursuant to any settlement entered into by the
Agent or such Lender in its discretion) to be repaid to a trustee or receiver,
or any other party, in connection with any Insolvency Proceeding or otherwise,
then (a) to the extent of such recovery, the obligation or part thereof
originally intended to be satisfied shall be revived and continued in full force
and effect as if such payment had not been made or such set-off had not occurred
and (b) each Lender severally agrees to pay to the Agent upon demand its pro
rata share of any amount so recovered from or repaid by the Agent.
11.7 Successors and Assigns. The provisions of this Agreement shall
be binding upon and inure to the benefit of the
-92-
100
parties hereto and their respective successors and assigns, except that the
Company may not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the Agent and each Lender.
11.8 Assignments, Participations, etc. (a) Any Lender may, with the
written consent of the Company at all times other than during the existence of
an Event of Default and the Agent and each Issuing Lender, which consent of the
Company shall not be unreasonably withheld, at any time assign and delegate to
one or more Eligible Assignees (provided that no written consent of the Company,
the Agent or any Issuing Lender shall be required in connection with any
assignment and delegation by a Lender to an Eligible Assignee that is an
Affiliate of such Lender) (each an "Assignee") all, or any part of all, of the
Loans, the Revolving Commitment, the L/C Obligations and the other rights and
obligations of such Lender hereunder, in a minimum amount of $5,000,000 (or, if
less, all of such Lender's remaining rights and obligations hereunder);
provided, however, that the Company, the Agent and the Issuing Lenders may
continue to deal solely and directly with such Lender in connection with the
interest so assigned to an Assignee until (i) written notice of such assignment,
together with payment instructions, addresses and related information with
respect to the Assignee shall have been given to the Company and the Agent by
such Lender and the Assignee; (ii) such Lender and the Assignee shall have
delivered to the Company and the Agent an Assignment and Acceptance in the form
of Exhibit Q ("Assignment and Acceptance") together with any Note or Notes
subject to such assignment and (iii) the assignor Lender or the Assignee has
paid to the Agent a processing fee in the amount of $3,500.
(b) From and after the date that the Agent notifies the assignor
Lender that it has provided its consent, and received the consents of the
Issuing Lenders and (if applicable) the Company, with respect to an executed
Assignment and Acceptance and payment of the above-referenced processing fee,
(i) the Assignee thereunder shall be a party hereto and, to the extent that
rights and obligations hereunder have been assigned to it pursuant to such
Assignment and Acceptance, shall have the rights and obligations of a Lender
under the Loan Documents, and (ii) the assignor Lender shall, to the extent that
rights and obligations hereunder and under the other Loan Documents have been
assigned by it pursuant to such Assignment and Acceptance, relinquish its rights
and be released from its obligations under the Loan Documents.
(c) Any Lender may at any time sell to one or more commercial banks
or other Persons not Affiliates of the Company (a "Participant") participating
interests in any Loan, the Revolving Commitment of such Lender and the other
interests of such Lender (the "originating Lender") hereunder and under the
other Loan Documents; provided, however, that (i) the originating Lender's
obligations under this Agreement shall remain unchanged,
-93-
101
(ii) the originating Lender shall remain solely responsible for the performance
of such obligations, (iii) the Company, the Issuing Lenders and the Agent shall
continue to deal solely and directly with the originating Lender in connection
with the originating Lender's rights and obligations under this Agreement and
the other Loan Documents, and (iv) no Lender shall transfer or grant any
participating interest under which the Participant has rights to approve any
amendment to, or any consent or waiver with respect to, this Agreement or any
other Loan Document, except to the extent such amendment, consent or waiver
would require unanimous consent of the Lenders as described in the first proviso
to Section 11.1. In the case of any such participation, the Participant shall be
entitled to the benefit of Sections 4.1, 4.3 and 11.5 as though it were also a
Lender hereunder (provided, with respect to Sections 4.1 and 4.3, the Company
shall not be required to pay any amount which it would not have been required to
pay if no participating interest had been sold), and if amounts outstanding
under this Agreement are due and unpaid, or shall have been declared or shall
have become due and payable upon the occurrence of an Event of Default, the
Participant shall be deemed to have the right of set-off in respect of its
participating interest in amounts owing under this Agreement to the same extent
as if the amount of its participating interest were owing directly to it as a
Lender under this Agreement.
(d) Notwithstanding any other provision in this Agreement, any
Lender may at any time create a security interest in, or pledge all or any
portion of its rights under and interest in this Agreement and any Note held by
it in favor of any Federal Reserve Bank in accordance with Regulation A of the
FRB or U.S. Treasury Regulation 31 CFR Section203.14, and such Federal Reserve
Bank may enforce such pledge or security interest in any manner permitted under
applicable law.
11.9 Confidentiality. Each Lender agrees to take, and to cause its
Affiliates to take, normal and reasonable precautions and exercise due care to
maintain the confidentiality of all information identified as "confidential" or
"secret" by the Company and provided to it by the Company or any Subsidiary, or
by the Agent on the Company's or any Subsidiary's behalf, under this Agreement
or any other Loan Document, and neither such Lender nor any of its Affiliates
shall use any such information other than in connection with or in enforcement
of this Agreement and the other Loan Documents or in connection with other
business now or hereafter existing or contemplated with the Company or any
Subsidiary; except to the extent such information (i) was or becomes generally
available to the public other than as a result of disclosure by such Lender, or
(ii) was or becomes available on a non-confidential basis from a source other
than the Company, provided that such source is not bound by a confidentiality
agreement with the Company or any Subsidiary known to such Lender; provided,
however, that any Lender may disclose such information (A) at the request or
pursuant to any requirement of
-94-
102
any Governmental Authority to which such Lender is subject or in connection with
an examination of such Lender by any such authority; (B) pursuant to subpoena or
other court process; (C) when required to do so in accordance with the
provisions of any applicable Requirement of Law; (D) to the extent reasonably
required in connection with any litigation or proceeding to which the Agent or
any Lender or any of their respective Affiliates may be party; (E) to the extent
reasonably required in connection with the exercise of any remedy hereunder or
under any other Loan Document; (F) to such Lender's independent auditors and
other professional advisors; (G) to any Participant or Assignee, actual or
potential, provided that such Person agrees in writing to keep such information
confidential to the same extent required of the Lenders hereunder; (H) as to any
Lender or its Affiliate, as expressly permitted under the terms of any other
document or agreement regarding confidentiality to which the Company or any
Subsidiary is party or is deemed party with such Lender or such Affiliate; and
(I) to its Affiliates.
11.10 Set-off. In addition to any right or remedy of the Lenders
provided by law, if an Event of Default exists, or the Loans have been
accelerated, each Lender is authorized at any time and from time to time,
without prior notice to the Company, any such notice being waived by the Company
to the fullest extent permitted by law, to set off and apply any and all
deposits (general or special, time or demand, provisional or final) at any time
held by, and other indebtedness at any time owing by, such Lender to or for the
credit or the account of the Company against any and all Obligations owing to
such Lender, now or hereafter existing, irrespective of whether or not the Agent
or such Lender shall have made demand under this Agreement or any other Loan
Document and although such Obligations may be contingent or unmatured. Each
Lender agrees promptly to notify the Company and the Agent after any such
set-off and application made by such Lender; provided that the failure to give
such notice shall not affect the validity of such set-off and application.
11.11 Automatic Debits of Fees. With respect to any commitment fee,
arrangement fee, agency fee, letter of credit fee or other fee, or any other
cost or expense (including Attorney Costs) due and payable to the Agent or any
Issuing Lender under the Loan Documents, the Company hereby irrevocably
authorizes BofA (and, if requested by BofA, BAI) to debit any deposit account of
the Company with BofA or BAI in an amount such that the aggregate amount debited
from all such deposit accounts does not exceed such fee or other cost or
expense; provided that the Company may issue instructions that override such
authorization on a per transaction basis and that with respect to any fee, cost
or expense (other than a commitment fee, arrangement fee, agency fee or letter
of credit fee) the Agent or any Issuing Lender shall not debit any deposit
account of the Company for such fee, cost or expense unless the Agent or Issuing
Lender has given the Company prior notice of its intention to so debit such
deposit account. If there are insufficient funds in such deposit
-95-
103
accounts to cover the amount of the fee or other cost or expense then due, such
debits will be reversed (in whole or in part, in BofA's sole discretion) and
such amount not debited shall be deemed to be unpaid. No such debit under this
Section shall be deemed a set-off.
11.12 Notification of Addresses, Lending Offices, Etc. Each Lender
shall notify the Agent in writing of any change in the address to which notices
to such Lender should be directed, of addresses of any Lending Office, of
payment instructions in respect of all payments to be made to it hereunder and
of such other administrative information as the Agent shall reasonably request.
11.13 Counterparts. This Agreement may be executed in any number of
separate counterparts, each of which, when so executed, shall be deemed an
original, and all of which taken together shall constitute but one and the same
instrument.
11.14 Severability. The illegality or unenforceability of any
provision of this Agreement or any instrument or agreement required hereunder
shall not in any way affect or impair the legality or enforceability of the
remaining provisions of this Agreement or such instrument or agreement.
11.15 No Third Parties Benefited. This Agreement is made and entered
into for the sole protection and legal benefit of the Company, the Lenders, the
Agent and the Agent-Related Persons, and their permitted successors and assigns,
and no other Person shall be a direct or indirect legal beneficiary of, or have
any direct or indirect cause of action or claim in connection with, this
Agreement or any other Loan Document.
11.16 Governing Law and Jurisdiction. (a) THIS AGREEMENT AND ANY
NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK; PROVIDED THAT THE AGENT AND THE LENDERS SHALL RETAIN ALL
RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE
OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, AND
BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH OF THE COMPANY, THE AGENT AND
THE LENDERS CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NONEXCLUSIVE JURISDICTION OF SUCH COURTS. EACH OF THE COMPANY, THE AGENT AND THE
LENDERS IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING
OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR
HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION
IN RESPECT OF THIS AGREEMENT OR ANY DOCUMENT RELATED HERETO. THE COMPANY, THE
AGENT AND THE LENDERS EACH WAIVE PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.
-96-
104
11.17 Waiver of Jury Trial. THE COMPANY, THE LENDERS AND THE AGENT
EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF
ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT, THE OTHER LOAN
DOCUMENTS, OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, IN ANY ACTION,
PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY ANY OF THE PARTIES AGAINST
ANY OTHER PARTY OR ANY AGENT-RELATED PERSON, PARTICIPANT OR ASSIGNEE, WHETHER
WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE COMPANY, THE
LENDERS AND THE AGENT EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE
TRIED BY A COURT TRIAL WITHOUT A JURY. WITHOUT LIMITING THE FOREGOING, THE
PARTIES FURTHER AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED
BY OPERATION OF THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING
WHICH SEEKS, IN WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF
THIS AGREEMENT OR THE OTHER LOAN DOCUMENTS OR ANY PROVISION HEREOF OR THEREOF.
THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENT, RENEWAL, SUPPLEMENT OR
MODIFICATION TO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS.
11.18 Subsidiary References. The provisions of this Agreement
relating to Subsidiaries of the Company shall apply only at such times as the
Company has one or more Subsidiaries; and the provisions of this Agreement
regarding consolidated financial statements and covenants shall apply only at
such times as the Company has one or more consolidated Subsidiaries.
11.19 Entire Agreement. This Agreement, together with the other Loan
Documents, embodies the entire agreement and understanding among the Company,
the Lenders and the Agent, and supersedes all prior or contemporaneous
agreements and understandings of such Persons, verbal or written, relating to
the subject matter hereof and thereof.
-97-
105
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered in Chicago, Illinois by their proper and duly
authorized officers as of the day and year first above written.
FIBERITE, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------
Title: Chief Financial Officer
----------------------------------
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
By: /s/ Xxxx-Xxxxxx Xxxxxx
-------------------------------------
Title: Vice President
----------------------------------
BANK OF AMERICA ILLINOIS, as an
Issuing Lender
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Title: Vice President
----------------------------------
BANK OF AMERICA ILLINOIS, as a
Lender
By: /s/ Xxxx X. Xxxxxxxx
-------------------------------------
Title: Vice President
----------------------------------
DRESDNER BANK AG, LOS ANGELES AGENCY
AND GRAND CAYMAN BRANCH
By: /s/ Xxx X. Xxxxx
-------------------------------------
Title: Senior Vice President
----------------------------------
By: /s/ Xxxxxx X. Xxxxx
-------------------------------------
Title: Vice President
----------------------------------
THE BANK OF NOVA SCOTIA
By: /s/ Xxxx X. Quick
-------------------------------------
Title: Senior Relationship Manager
----------------------------------
BANQUE PARIBAS
By: /s/ Xxxxxx X. Xxxxx, Xx.
-------------------------------------
Title: Senior Credit Officer
----------------------------------
By: /s/ Xxxxxx X. X'Xxxxx
-------------------------------------
Title: Vice President
----------------------------------
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By: /s/ J. Xxxxx Xxxx
-------------------------------------
Title: Vice President
----------------------------------
By: /s/ Xxxxxx X. Xxxx, Xx.
-------------------------------------
Title: Vice President
----------------------------------
THE NIPPON CREDIT BANK, LTD., LOS
ANGELES AGENCY
By: /s/ Xxxxxxxx Xxxx
-------------------------------------
Title: Deputy General Manager
----------------------------------
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Title: Vice President
----------------------------------
PILGRIM PRIME RATE TRUST
By: /s/ Xxxxxxxx Xxxxxxxx
-------------------------------------
Title: Assistant Portfolio Manager
----------------------------------
VAN XXXXXX XXXXXX PRIME RATE INCOME
TRUST
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------
Title: Senior Vice President
----------------------------------
106
FIRST AMENDMENT
THIS FIRST AMENDMENT dated as of October 30, 1995 (this "Amendment") is
to the Credit Agreement (the "Credit Agreement") dated as of October 6, 1995
among FIBERITE, INC. (the "Company"), various financial institutions and BANK
OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent (the "Agent").
Unless otherwise defined herein as defined in the Credit Agreement.
WHEREAS, the Company, the Agent and Bank of America Illinois have
entered into the Credit Agreement; and
WHEREAS, the parties hereto desire to amend the Credit Agreement to (a)
add The Bank of Nova Scotia, Banque Paribas, Deutsche Bank AG, New York and/or
Cayman Islands Branches, Dresdner Bank AG, Los Angeles Agency and Grand Cayman
Branch, The Nippon Credit Bank Ltd., Los Angeles Agency, Pilgrim Prime Rate
Trust, Senior Debt Portfolio and Van Xxxxxx Xxxxxxx Prime Rate Income Trust
(collectively the "New Lenders") as "Lenders" thereunder and (b) make certain
other changes as hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:
SECTION 1 AMENDMENT. Effective on (and subject to the occurrence of)
the First Amendment Effective Date (as defined below), the Credit Agreement
shall be amended in accordance with Sections 1.1 through 1.17 below.
1.1 Eligible Assignee. The definition of "Eligible Assignee" set
forth in Section 1.1 is amended by (a) deleting the word "and" immediately
prior to clause (iii) thereof; and (b) adding a semi-colon and the following
language before the period at the end thereof: "and (iv) an insurance company,
pension fund, mutual fund, commercial finance company or similar financial
institution having a net worth of at least $50,000,000."
1.2 Excess Cash Flow. Subsection (b) of the definition of "Excess
Cash Flow" is amended by (a) deleting the language "Section 2.7 or" in the
second line of clause (i) thereof; and (b) deleting the words "Capital
Expenditures for such period" in clause (iii) thereof and substituting the
following words therefor: "Cash payments made in such period with respect to
Capital Expenditures".
107
1.3 Security Agreement. The definition of "Security Agreement" is
amended by deleting the term "5.1(g)" therein and substituting the term
"5.1(i)" therefor.
1.4 Section 2.1(a). Section 2.1(a) is amended by deleting the amount
"$50,000,000" therein and substituting the amount "$40,000,000" therefor.
1.5 Section 2.1(b). Section 2.1(b) is amended by deleting the amount
"$25,000,000" therein and substituting the amount "$35,000,000" therefor.
1.6 Section 2.7. Section 2.7 is amended by deleting the last
paragraph of such Section in its entirety and inserting in lieu thereof the
following:
"All prepayments of Term Loans pursuant to this Section 2.7 shall be
applied to the remaining installments thereof pro rata; provided that if
any Lender holding Term B Loans so requests, by notice to the Agent not
later than five Business Days prior to the date upon which such
prepayment is due, the portion of any prepayment which would have been
applied to such Lender's Term B Loans shall be applied pro rata to the
remaining installments of the Term A Loans of all Lenders (it being
understood that if the Term A Lenders incur additional funding losses
pursuant to Section 4.4 as a result of the reallocation of such
prepayment, the Company shall only be responsible for the portion of
such additional funding losses which would have been incurred by such
Term B Lender if such payment had been applied to such Lender's Term B
Loans)."
1.7 Section 2.8(a). The amortization schedule set forth in Section
2.8(a) is amended to read as follows:
Period Amount
------ ------
March 31, 1996 through December 31, 1997 $1,600,000
January 1, 1998 through December 31, 1998 2,000,000
January 1, 1999 through December 31, 2000 2,400,000
1.8 Section 2.8(b). The amortization schedule set forth in Section
2.8(b) is amended to read as follows:
Period Amount
------ ------
March 31, 1996 through December 31, 1999 $ 125,000
January 1, 2000 through December 31, 2000 250,000
January 1, 2001 through December 31, 2001 8,000,000
-2-
108
1.9 Section 4.7. Section 4.7 is amended by deleting the words "its
best" in the fifth line thereof and substituting the word "reasonable" therefor.
1.10 Section 5.1(k). Section 5.1(k) is amended by deleting the word
"each" in the fifth line thereof and substituting the words "the Parent"
therefor.
1.11 Section 8.19. Section 8.19 is amended by (a) substituting a comma
for the word "or" after the words "the Shareholder Agreement" in the fourth
line thereof; and (b) adding the following language after the words "Services
Agreements" in the fifth line thereof: "or (d) the Tax Sharing Agreement".
1.12 Section 10.11(b). Section 10.11(b) is amended by adding the
language ", if required by Section 11.1(a)(v)," immediately after the words
"Lenders or" in clause (vi) thereof.
1.13 Section 11.1(a). Section 11.1(a) is amended by (a) deleting the
word "or" immediately after clause (iv) thereof; and (b) deleting clause (v)
thereof and substituting the following therefor:
(v) release the Guaranty or release all or a substantial part
of the Collateral; or
(vi) amend or waive any provision of this Section, Section 2.7
or Section 2.14, or any other provision herein providing for consent or other
action by all Lenders.
1.14 Section 11.1(b). Section 11.1(b) is amended by (a) adding the
following parenthetical after the reference to Section 2.4 on the second line
thereof: "(as it relates to conversions and continuations of Revolving Loans)";
(b) deleting the comma after the language "Revolving Loans)" in the third line
thereof and substituting the word "or" therefor; and (c) inserting the
following parenthetical after the words "Required Revolving Lenders" on the
fifth line thereof: "(or, in the case of Section 2.8(c), all of the Revolving
Lenders)".
1.15 Section 11.8(a). Section 11.8(a) is amended by (a) adding the
words "with the written consents of" after the word "and" (and before the words
"the Agent") in the third line thereof; and (b) deleting the language "an
Eligible Assignee that is an Affiliate of such Lender)" in the eighth and ninth
lines thereof and substituting the following language therefor: "a Person
described in clause (iii) of the definition of Eligible Assignee)".
1.16 Schedule 1.1. Schedule 1.1 is amended in its entirety by
substituting the Schedule 1.1 attached hereto therefor.
-3-
109
1.17 Schedule 11.2. Schedule 11.2 is amended in its entirety by
substituting the Schedule 11.2 attached hereto therefor.
SECTION 2 REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Agent and the Lenders that (a) the representations and
warranties made in Article VI of the Credit Agreement are true and correct on
and as of the First Amendment Effective Date with the same effect as if made on
and as of the First Amendment Effective Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which
case they were true and correct as of such earlier date); (b) no Event of
Default or Unmatured Event of Default exists or will result from the execution
of this Amendment; (c) no event or circumstance has occurred since the Closing
Date that has resulted, or would reasonably be expected to result, in a
Material Adverse Effect; (d) the execution and delivery by the Company of
this Amendment and the New Notes (as defined below) and the performance by the
Company of its obligations under the Credit Agreement as amended hereby (as so
amended, the "Amended Credit Agreement") and the New Notes (i) are within the
corporate powers of the Company, (ii) have been duly authorized by all
necessary corporate action, (iii) have received all necessary governmental
approval and (iv) do not and will not contravene or conflict with any provision
of law or of the charter or by-laws of the Company or of any indenture, loan
agreement or other contract, order or decree which is binding upon the Company;
and (e) each of the Amended Credit Agreement and each New Note is the legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforceability may be limited to by
applicable bankruptcy, insolvency, or similar laws affecting the enforcement of
creditors' rights generally or by equitable principles relating to
enforceability.
SECTION 3 EFFECTIVENESS. The amendments set forth in Section 1 above
shall become effective, as of the day and year first above written, on such
date (the "First Amendment Effective Date") when the Agent shall have received,
(a) a counterpart of this Amendment executed by each of the parties hereto
(or, in the case of any party other than the Company from which the Agent has
not received a counterpart hereof, facsimile confirmation of the execution of a
counterpart hereof by such party) and (b) each of the following documents, each
in form and substance satisfactory to the Agent:
3.1 Notes. New Notes, substantially in the form of Exhibit D to the
Credit Agreement, payable to the order of each of the Lenders (collectively,
the "New Notes").
3.2 Confirmation. A confirmation from the Parent, substantially in
the form of Exhibit A hereto.
-4-
110
3.3 Opinion. An opinion of Xxxxxx, Xxxxxx & Xxxxxxx, substantially
in the form of Exhibit B hereto.
3.4 Other Documents. Such other documents as the Agent or any Lender
may reasonably request in connection with the Company's authorization,
execution and delivery of this Amendment and the New Notes.
SECTION 4 ADDITION OF LENDERS. On the First Amendment Effective Date,
each New Lender shall become a "Lender" under and for all purposes of the Credit
Agreement, shall be bound by the Credit Agreement, and shall be entitled to the
benefits of the Credit Agreement and each other Loan Document, and each Lender
(including Bank of America Illinois) shall have a Total Percentage, a Revolving
Commitment, a Revolving Percentage, a Term A Loan, a Term A Percentage, a Term B
Loan and a Term B Percentage in the respective amounts and percentages set forth
on Schedule 1.1 hereto. To facilitate the foregoing, each New Lender agrees that
on the First Amendment Effective Date and after giving effect to the changes
contemplated herein, it will remit to the Agent funds in an amount equal to its
Revolving Percentage of all outstanding Revolving Loans plus its Term A
Percentage of all outstanding Term A Loans plus its Term B Percentage of all
outstanding Term B Loans, and the Agent agrees to immediately remit all of such
funds received from each New Lender to Bank of America Illinois. Each New Lender
agrees that all interest and fees accrued under the Credit Agreement prior to
the First Amendment Effective Date are the property of Bank of America Illinois.
By their signatures below (a) the Company confirms that the amounts of the
Revolving Commitment, the Term A Loans and the Term B Loans set forth on
Schedule 1.1 are true and correct and (b) Bank of America Illinois confirms that
it has not sold or otherwise encumbered its rights under the Credit Agreement or
its interest in any Loans prior to the syndication thereof pursuant to this
Amendment.
SECTION 5 MISCELLANEOUS.
5.1 Continuing Effectiveness, etc. As herein amended, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects. After the First Amendment Effective Date, all
references in the Credit Agreement, the Notes, each other Loan Document and any
similar document to the "Credit Agreement" or similar terms shall refer to the
Amended Credit Agreement.
5.2 Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original but all such counterparts
shall together constitute one and the same Amendment.
-5-
111
5.3 Expenses. The Company agrees to pay the reasonable costs and
expenses of the Agent (including Attorney Costs) in connection with the
preparation, execution and delivery of this Amendment.
5.4 Governing Law. This Amendment shall be a contract made under and
governed by the internal laws of the State of New York.
5.5 Successors and Assigns. This Amendment shall be binding upon the
Company, the Lenders and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Lenders and the Agent and
the successors and assigns of the Lenders and the Agent.
-6-
112
Delivered at New York, New York, as of the day and year first above
written.
FIBERITE, INC.
By /s/ Xxxxx X. Xxxxxx
-------------------------------------
Title Chief Executive Officer
--------------------------------
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
By /s/
-------------------------------------
Title Vice President
--------------------------------
BANK OF AMERICA ILLINOIS
By /s/
-------------------------------------
Title Vice President
--------------------------------
DRESDNER BANK AG, LOS ANGELES AGENCY
AND GRAND CAYMAN BRANCH
By /s/ Xxx X. Xxxxx
-------------------------------------
Title Senior Vice President
--------------------------------
By /s/ Xxxxxx X. Xxxxx
-------------------------------------
Title Vice President
--------------------------------
-7-
000
XXX XXXX XX XXXX XXXXXX
By /s/
------------------------------------
Title
------------------------------
BANQUE PARIBAS
By /s/
------------------------------------
Title Senior Credit Officer
------------------------------
By /s/
------------------------------------
Title
------------------------------
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By /s/ J. Xxxxx Xxxx
-----------------------------------
J. Xxxxx Xxxx
Title Vice President
-----------------------------
By /s/ Xxxxxx X. Xxxx, Xx.
------------------------------------
Xxxxxx X. Xxxx, Xx.
Title Vice President
------------------------------
-8-
114
THE NIPPON CREDIT BANK, LTD., LOS
ANGELES AGENCY
By /s/
---------------------------------------
Title
----------------------------------
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By /s/
---------------------------------------
Title Vice President
----------------------------------
PILGRIM PRIME RATE TRUST
By /s/
---------------------------------------
Title Assistant Portfolio Manager
----------------------------------
VAN XXXXXX XXXXXXX PRIME RATE
INCOME TRUST
By Xxxxxxx X. Xxxxxxx
---------------------------------------
Title Sr. Vice Pres.-Portfolio Manager
----------------------------------
-9-
115
SCHEDULE 1.1
COMMITMENTS AND PERCENTAGES
Total Revolving Revolving Term A Term A Term B Term B
Name of Lender Percentage Commitment Percentage Loan Percentage Loan Percentage
-------------- ---------- ---------- ---------- ------- ---------- ------- ----------
Bank of America 20.00000000% $ 5,769,230.76 23.07692304% $ 9,230,769.24 23.07692310% $ 5,000,000.00 14.28571429%
Illinois
Deutsche Bank AG, 10.00000000% $ 3,846,153.85 15.38461540% $ 6,153,846.15 15.38461538% $ 0.00 0.00000000%
New York and/or
Cayman Islands
Branchas
The Bank of Nova 10.00000000% $ 3,846,153.85 15.38461540% $ 6,153,846.15 15.38461538% $ 0.00 0.00000000%
Scotia
Banque Paribas 10.00000000% $ 2,884,615.38 11.53846152% $ 4,615,384.62 11.53846155% $ 2,500,000.00 7.00000000%
Dresdner Bank AG, Los 12.00000000% $ 4,807,692.31 19.23076924% $ 7,692,307.69 19.23076923% $ 0.00 0.00000000%
Angeles Agency and
Grand Cayman Branch
The Nippon Credit 10.00000000% $ 3,846,153.85 15.38461540% $ 6,153,846.15 15.38461538% $ 0.00 0.00000000%
Bank, Ltd., Los
Angeles Agency
Senior Debt 9.50000000% $ 0.00 0.00000000% $ 0.00 0.00000000% $ 9,500,000.00 27.14285714%
Portfolio
Pilgrim Prime Rate 9.00000000% $ 0.00 0.00000000% $ 0.00 0.00000000% $ 9,000,000.00 25.71428571%
Trust
Van Xxxxxx Xxxxxxx 9.00000000% $ 0.00 0.00000000% $ 0.00 0.00000000% $ 9,000,000.00 25.71428571%
Prime Rate Income
Trust
-----------------------------------------------------------------------------------------------------------------------------------
TOTALS 100.00000000% $25,000,000.00 100.00000000% $40,000,000.00 100,00000000% $35,000,000.00 100,00000000%
116
SCHEDULE 11.2
OFFSHORE AND DOMESTIC LENDING OFFICES,
ADDRESSES FOR NOTICES
BANK OF AMERICA NATIONAL TRUST
AND SAVINGS ASSOCIATION,
as Agent
Bank of America National Trust
and Savings Association
Agency Management Services #5596
0000 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx-Xxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANK OF AMERICA ILLINOIS,
as a Lender
Domestic and Offshore Lending Office:
Xxxxxxx, Xxxxxxxx 00000
Notices (other than Borrowing notices and Notices of
Conversion/Continuation):
Bank of America Illinois
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANK OF AMERICA, ILLINOIS,
as Issuing Lender
Address for Notices:
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
000
XXXXXXXX XXXX XX, XXX XXXXXXX AGENCY AND GRAND CAYMAN BRANCH,
as a Lender
Dresdner Bank
000 Xxxxx Xxxxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
THE BANK OF NOVA SCOTIA,
as a Lender
The Bank of Nova Scotia
000 Xxxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
BANQUE PARIBAS,
as a Lender
Banque Paribas
000 Xxxx Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxxx X'Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
DEUTSCHE BANK AG, NEW YORK AND/OR CAYMAN ISLANDS BRANCHES,
as a Lender
Deutsche Bank AG, New York Branch
00 X. 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Mr. J. Xxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-2-
118
THE NIPPON CREDIT BANK, LTD., LOS ANGELES AGENCY,
as a Lender
The Nippon Credit Bank, Ltd., Los Angeles Agency
000 X. Xxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
SENIOR DEBT PORTFOLIO,
as a Lender
Senior Debt Portfolio
c/o Boston Management and Research
00 Xxxxxxx Xxxxxx
0xx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
PILGRIM PRIME RATE TRUST,
as a Lender
Pilgrim America
Two Renaissance Square
00 X. Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
VAN XXXXXX XXXXXXX PRIME RATE INCOME TRUST,
as a Lender
Xxx Xxxxxx American Capital
Xxx Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-3-
119
FIBERITE, INC.
Fiberite, Inc.
0000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy to:
Fiberite Holdings, Inc.
x/x XXX Merchant Banking, Inc.
000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-4-
120
EXHIBIT A
CONFIRMATION
Dated as of October , 1995
To: Bank of America National Trust and Savings Association, as Agent, and
the other financial institutions party to the Credit Agreement referred
to below
Please refer to (a) the Credit Agreement dated as of October 6, 1995
among Fiberite, Inc., various financial institutions (the "Lenders") and Bank
of America National Trust and Savings Association, as Agent (the "Agent"); (b)
the First Amendment dated as of October 30, 1995 to the Credit Agreement (the
"First Amendment"); and (c) the Guaranty (the "Guaranty") dated as of October
6, 1995, executed by Fiberite Holdings, Inc. in favor of the Agent and the
Lenders.
The undersigned hereby confirms to the Agent and the Lenders that,
after giving effect to the First Amendment and the transactions contemplated
thereby, the Guaranty and each other Loan Document (as defined in the Credit
Agreement) to which the undersigned is a party continues in full force and
effect and is the legal, valid and binding obligation of the undersigned,
enforceable against the undersigned in accordance with its terms.
FIBERITE HOLDINGS, INC.
By: _________________________________
Title: ______________________________
121
SECOND AMENDMENT AND WAIVER
THIS SECOND AMENDMENT AND WAIVER dated as of March 29, 1996 (this
"Amendment") is among FIBERITE, INC. (the "Company"), various financial
institutions set forth on the signature pages hereto (the "Lenders") and BANK
OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent (the "Agent").
WHEREAS, the Company, the Lenders, and the Agent have entered into a
Credit Agreement dated as of October 6, 1995 (as amended by the First Amendment
dated as of October 30, 1995, the "Credit Agreement"). Unless otherwise defined
herein, terms defined in the Credit Agreement are used herein as defined in the
Credit Agreement.
WHEREAS, the parties hereto desire to waive certain Sections of the
Credit Agreement and to amend the Credit Agreement to make certain changes as
hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:
SECTION 1 AMENDMENT. Effective on (and subject to the occurrence of)
the Second Amendment Effective Date (as defined below), the Credit Agreement
shall be amended in accordance with Sections 1.1 through 1.4 below.
1.1 Section 1.1. The definition of "Funded Debt" is hereby amended by
adding the phrase ", without duplication," after the word "means" on the first
line thereof.
1.2 Section 8.1. Section 8.1 is hereby amended by (i) deleting the
"and" at the end of clause (j) thereof, (ii) deleting the "." at the end of
clause (k) thereof and inserting in lieu thereof "; and" and (iii) inserting an
additional clause which shall read as follows:
"(1) Liens on the assets of Fiberite Europe Gmbh securing Indebtedness
permitted by Section 8.5(g)."
1.3 Section 8.4 is hereby amended by inserting the words "or
Contingent Obligations" after the word "advances" on the third line of clause
(c) thereof.
1.4 Section 8.8 is hereby amended by (i) deleting the "and" at the end
of clause (d) thereof; (ii) deleting the "." at the end of clause (e) thereof
and inserting in lieu thereof "; and" and inserting a clause (f) which shall
read as follows:
122
"(f) Contingent Obligations with respect to Indebtedness permitted by
Section 8.5(g) so long as the amount of such Contingent Obligations, together
with other investments in Foreign Subsidiaries does not exceed the amount
permitted by Section 8.4(c)."
SECTION 2 ACKNOWLEDGMENT. The Lenders acknowledge that the intent of
the parties was for the Company to have the capital structure of Fiberite
Europe GmbH ("Fiberite Europe") in place as of the Closing Date. Pursuant to a
letter dated February 21, 1996, the Company informed Bank of America Illinois
that the capital structure of Fiberite Europe is as follows:
Registered Equity of 50,000DM,
Shareholder Contribution fo 3,450,000DM; and
Shareholder Loan of 6,500,000DM.
Since the intent of the parties was to have the capital structure in
place as of the Closing Date, the Lenders acknowledge that the Shareholder Loan
shall be deemed to be permitted Indebtedness pursuant to Section 8.5(c) and
shall not be included in the $3,000,000 of Indebtedness permitted by Section
8.5(d) and the Borrower's investment in Fiberite Europe shall be deemed to be
permitted under Section 8.4(c) and shall not be included in the $3,000,000 of
investments permitted by Section 8.4(c).
SECTION 3 EXTENSION OF WAIVER. Pursuant to a letter agreement (the
"Letter Agreement") dated October 6, 1995, among the Company, the Agent and the
Lenders, the Agent agreed not to record the Minnesota Mortgage (as defined in
the Letter Agreement) until the earlier of March 31, 1996 and the occurrence of
an Event of Default. The Company has requested that the parties hereto extend
such date to the earlier of May 31, 1996 and the occurrence of an Event of
Default. The Lenders and the Agent hereby agree to such extension and, as a
consequence, the Agent will not record the Minnesota Mortgage until the earlier
of May 31, 1996 and the occurrence of an Event of Default. The parties hereto
acknowledge that, other than as set forth herein, the Letter Agreement shall
remain in full force and effect and is hereby ratified and confirmed in all
respects, including, without limitation, the obligations of the Company with
respect to the Minnesota Property set forth in the third paragraph thereof.
SECTION 4 WAIVER OF CERTAIN SECTIONS. The Company's Independent
Auditor has notified the Company that the Independent Auditor cannot issue the
Company's audited financial statements without a qualification with respect to
the Company's post-retirement plans because of the failure of the Sellers to
furnish information to the Independent Auditor. The Company has requested that
the Lenders and the Agent waive Section 7.1(a)(y)
-2-
123
with respect to such qualification until May 31, 1996. In addition, because of
the Company's plans to increase the facilities in the near future, the Company
has requested that the Lenders and the Agent waive Section 7.12 (requiring the
Company to enter into Permitted Swap Obligations within 180 days of the Closing
Date) until June 30, 1996. The Lenders and the Agent hereby waive Sections
7.1(a)(y) and 7.12 to the extent specified above.
SECTION 5 REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Agent and the Lenders that (a) the representations and
warranties made in Article VI of the Credit Agreement are true and correct on
and as of the Second Amendment Effective Date with the same effect as if made
on and as of the Second Amendment Effective Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they were true and correct as of such earlier date); (b) no Event of Default or
Unmatured Event of Default exists or will result from the execution of this
Amendment; (c) no event or circumstance has occurred since the Closing Date
that has resulted, or would reasonably be expected to result, in a Material
Adverse Effect; (d) the execution and delivery by the Company of this Amendment
and the performance by the Company of its obligations under the Credit Agreement
as amended hereby (as so amended, the "Amended Credit Agreement") (i) are
within the corporate powers of the Company, (ii) have been duly authorized by
all necessary corporate action, (iii) have received all necessary governmental
approval and (iv) do not and will not contravene or conflict with any provision
of law or of the charter or by-laws of the Company or of any indenture, loan
agreement or other contract, order or decree which is binding upon the Company;
and (e) the Amended Credit Agreement is the legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
or similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability.
SECTION 6 EFFECTIVENESS. The amendments set forth in Section 1 above
shall become effective, as of the day and year first above written, on such date
(the "Second Amendment Effective Date") when the Agent shall have received, (a)
a counterpart of this Amendment executed by each of the Required Lenders (or,
in the case of any party other than the Company from which the Agent has not
received a counterpart hereof, facsimile confirmation of the execution of a
counterpart hereof by such party) and (b) each of the following documents, each
in form and substance satisfactory to the Agent:
-3-
124
6.1 Confirmation. A confirmation from the Parent, substantially in
the form of Exhibit A hereto.
6.2 Other Documents. Such other documents as the Agent or any Lender
may reasonably request in connection with the Company's authorization,
execution and delivery of this Amendment.
SECTION 7 MISCELLANEOUS.
7.1 Continuing Effectiveness, etc. As herein amended, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects. After the Second Amendment Effective Date, all
references in the Credit Agreement, the Notes, each other Loan Document and any
similar document to the "Credit Agreement" or similar terms shall refer to the
Amended Credit Agreement.
7.2 Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original but all such counterparts
shall together constitute one and the same Amendment.
7.3 Expenses. The Company agrees to pay the reasonable costs and
expenses of the Agent (including Attorney Costs) in connection with the
preparation, execution and delivery of this Amendment.
7.4 Governing Law. This Amendment shall be a contract made under and
governed by the internal laws of the State of New York.
7.5 Successors and Assigns. This Amendment shall be binding upon the
Company, the Lenders and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Lenders and the Agent and
the successors and assigns of the Lenders and the Agent.
-4-
125
Delivered at New York, New York, as of the day and year first above
written.
FIBERITE, INC.
By /s/
---------------------------------------
Title CEO
----------------------------------
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
By /s/
---------------------------------------
Title Vice President
----------------------------------
BANK OF AMERICA ILLINOIS
By /s/
---------------------------------------
Title Vice President
----------------------------------
DRESDNER BANK AG, LOS ANGELES AGENCY
AND GRAND CAYMAN BRANCH
By /s/
---------------------------------------
Title Vice President
----------------------------------
By /s/ Xxx X. Xxxxx
---------------------------------------
Title Senior Vice President
----------------------------------
-5-
000
XXX XXXX XX XXXX XXXXXX
By /s/
____________________________________
Title________________________________
BANQUE PARIBAS
By_____________________________________
Title________________________________
By_____________________________________
Title________________________________
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By /s/ Xxxxx Xxx
___________________________________
Xxxxx Xxx
_______________________________
Title Assistant Vice President
By /s/ Xxxxxx X. Xxxx, Xx.
___________________________________
Xxxxxx X. Xxxx, Xx.
_______________________________
Title Vice President
INDOSUEZ CAPITAL FUNDING II, LTD.
By /s/
__________________________________
Title Vice President
_____________________________
-6-
127
THE NIPPON CREDIT BANK, LTD., LOS
ANGELES AGENCY
By /s/ Xxxxxxxx Xxxx
----------------------------------
Title Deputy General Manager
Name: Xxxxxxxx Xxxx
SENIOR DEBT PORTFOLIO
By: Boston Management and Research,
as Investment Advisor
By /s/
----------------------------------
Title Assistant Treasurer
PILGRIM PRIME RATE TRUST
By /s/ Xxxxxxx X. Xxxxxxxx
----------------------------------
Xxxxxxx X. Xxxxxxxx
Title Vice President
VAN XXXXXX XXXXXXX PRIME RATE
INCOME TRUST
By /s/ Xxxxxxx X. Xxxxxxx
----------------------------------
Xxxxxxx X. Xxxxxxx
Title Sen Vice Pres
Portfolio Manager
-7-
128
EXHIBIT A
CONFIRMATION
Dated as of March 29, 1996
To: Bank of America National Trust and Savings Association, as Agent, and
the other financial institutions party to the Credit Agreement referred
to below
Please refer to (a) the Credit Agreement dated as of October 6, 1995
among Fiberite, Inc., various financial institutions (the "Lenders") and Bank
of America National Trust and Savings Association, as Agent (the "Agent"); (b)
the Second Amendment and Waiver dated as of March 29, 1996 to the Credit
Agreement (the "Second Amendment"); and (c) the Guaranty (the "Guaranty") dated
as of October 6, 1995, executed by Fiberite Holdings, Inc. in favor of the
Agent and the Lenders.
The undersigned hereby confirms to the Agent and the Lenders that,
after giving effect to the Second Amendment and the transactions contemplated
thereby, the Guaranty and each other Loan Document (as defined in the Credit
Agreement) to which the undersigned is a party continues in full force and
effect and is the legal, valid and binding obligation of the undersigned,
enforceable against the undersigned in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
FIBERITE HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxx
Title: Senior Vice President
129
THIRD AMENDMENT
THIS THIRD AMENDMENT dated as of May 17, 1996 (this "Amendment") is
among FIBERITE, INC. (the "Company"), various financial institutions (the
"Lenders") and BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION, as Agent
(the "Agent").
WHEREAS, the Company, the Lenders and the Agent have entered into a
Credit Agreement dated as of October 6, 1995 (as amended by the First Amendment
dated as of October 30, 1995 and the Second Amendment and Waiver dated as of
March 29, 1996, the "Credit Agreement"; unless otherwise defined herein, terms
defined in the Credit Agreement are used herein as defined in the Credit
Agreement);
WHEREAS, the Company has entered into an agreement to acquire the
equipment, formulations and other specific assets of Simmaco SARL, a company
located in Corcelles-Les-Lens, France, from SOFREMI SARL and will create a
wholly-owned Foreign Subsidiary organized under the laws of France, Fiberite
France SARL, through which it will acquire certain of such assets;
WHEREAS, the Company will invest sufficient amounts in Fiberite France
SARL in order to enable Fiberite France SARL to complete such acquisition;
WHEREAS, Fiberite France SARL will pay approximately $1,950,000 for
such assets, of which $1,350,000 will be deferred and will constitute
Indebtedness under the Credit Agreement; and
WHEREAS, the parties hereto desire to amend the Credit Agreement to
make certain changes as hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:
SECTION 1 AMENDMENT. Effective on (and subject to the occurrence of)
the Third Amendment Effective Date (as defined below), the Credit Agreement
shall be amended in accordance with Sections 1.1 through 1.3 below.
1.1 Section 8.4(c). Section 8.4(c) is hereby amended by (i) deleting
the amount "$3,000,000" therein and substituting the amount "$4,000,000"
therefor and (ii) adding the following phrase after the words "Closing Date"
therein: "(excluding up to $1,950,000 of the Company's initial investment in
Fiberite France SARL, to the extent such investment is used to acquire the
assets of Simmaco SARL from SOFREMI SARL)".
130
1.2 Section 8.4(h). Section 8.4(h) is hereby amended by deleting the
amount "$500,000" therein and substituting the amount "$3,000,000" therefor.
1.3 Section 8.5(h). Section 8.5(h) is hereby amended by (i) deleting
the amount "$1,000,000" therein and substituting the amount "$2,000,000"
therefor and (ii) adding the following phrase after the words "Foreign
Subsidiary" at the end thereof: "(excluding Fiberite France SARL, to the
extent of any deferred acquisition payment incurred in connection with purchase
of the assets of Simmaco SARL from SOFREMI SARL)."
SECTION 2 REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Agent and the Lenders that (a) the representations and
warranties made in Article VI of the Credit Agreement are true and correct on
and as of the Third Amendment Effective Date with the same effect as if made on
and as of the Third Amendment Effective Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they were true and correct as of such earlier date); (b) no Event of Default or
Unmatured Event of Default exists or will result from the execution of this
Amendment; (c) no event or circumstance has occurred since the Closing Date that
has resulted, or would reasonably be expected to result, in a Material Adverse
Effect; (d) the execution and delivery by the Company of this Amendment and the
performance by the Company of its obligations under the Credit Agreement as
amended hereby (as so amended, the "Amended Credit Agreement") (i) are within
the corporate powers of the Company, (ii) have been duly authorized by all
necessary corporate action, (iii) have received all necessary governmental
approval and (iv) do not and will not contravene or conflict with any provision
of law or of the charter or by-laws of the Company or of any indenture, loan
agreement or other contract, order or decree which is binding upon the Company;
and (e) the Amended Credit Agreement is the legal, valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency, or
similar laws affecting the enforcement of creditors' rights generally or by
equitable principles relating to enforceability.
SECTION 3 EFFECTIVENESS. The amendments set forth in Section 1 above
shall become effective, as of the day and year first above written, on such
date (the "Third Amendment Effective Date") when the Agent shall have received,
(a counterpart of this Amendment executed by each of the Required Lenders
(or, in the case of any party other than the Company from which the Agent has
not received a counterpart hereof, facsimile confirmation of the execution of
a counterpart hereof by such party) and (b) each
-2-
131
of the following documents, each in form and substance satisfactory to the
Agent:
3.1 Confirmation. A confirmation from the Parent, substantially in the
form of Exhibit A hereto.
3.2 Other Documents. Such other documents as the Agent or any Lender
may reasonably request in connection with the Company's authorization,
execution and delivery of this Amendment.
SECTION 4 MISCELLANEOUS.
4.1 Pledge Agreement. The Company agrees to promptly (and in any event
not later than June 30, 1996) (i) provide a pledge agreement (or its functional
equivalent under the law of France) executed by the Company pledging 65% of the
outstanding common stock of Fiberite France SARL to the Agent, for the benefit
of the Agent and the Lenders, in form and substance reasonably satisfactory to
the Agent and its counsel and (ii) take such other actions as may be necessary
or as the Agent or any Lender may reasonably request to cause such pledge to be
perfected under applicable law.
4.2 Continuing Effectiveness, etc. As herein amended, the Credit
Agreement shall remain in full force and effect and is hereby ratified and
confirmed in all respects. After the Third Amendment Effective Date, all
references in the Credit Agreement, the Notes, each other Loan Document and any
similar document to the "Credit Agreement" or similar terms shall refer to the
Amended Credit Agreement.
4.3 Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an original but all such counterparts
shall together constitute one and the same Amendment.
4.4 Expenses. The Company agrees to pay the reasonable costs and
expenses of the Agent (including Attorney Costs) in connection with the
preparation, execution and delivery of this Amendment.
4.5 Governing Law. This Amendment shall be a contract made under and
governed by the internal laws of the State of New York.
4.6 Successors and Assigns. This Amendment shall be binding upon the
Company, the Lenders and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Lenders and the Agent and
the successors and assigns of the Lenders and the Agent.
-3-
132
Delivered at New York, New York, as of the day and year first above
written.
FIBERITE, INC.
By /s/
--------------------------------
Title CFO
--------------------------
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
By /s/
--------------------------------
Title Vice President
--------------------------
BANK OF AMERICA ILLINOIS
By /s/
--------------------------------
Title Vice President
--------------------------
DRESDNER BANK AG, LOS ANGELES AGENCY
AND GRAND CAYMAN BRANCH
By /s/ Xxx X. Xxxxx
--------------------------------
Xxx X. Xxxxx
Title Sen. Vice Pres.
--------------------------
By /s/ Xxxxx Xxxxxx
--------------------------------
Xxxxx Xxxxxx
Title Asst. Vice Pres.
--------------------------
-4-
000
XXX XXXX XX XXXX XXXXXX
By /s/
--------------------------------
Title Senior Relationship Manager
---------------------------
BANQUE PARIBAS
By /s/
--------------------------------
Title Vice President
--------------
By /s/ Xxxx X. Xxxxxx
--------------------------------
Xxxx X. Xxxxxx
Title Vice President
--------------
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By /s/ Xxxx X. Xxxxxx
--------------------------------
Xxxx X. Xxxxxx
Title Director
--------
By /s/
--------------------------------
Title Associate
---------
INDOSUEZ CAPITAL FUNDING II, LTD.
By: Indosuez Capital, as
Portfolio Advisor
By /s/
--------------------------------
Title V.P.
----
-5-
134
THE NIPPON CREDIT BANK, LTD.,
LOS ANGELES AGENCY
By /s/
------------------------------------
Title Vice President & Senior Manager
-------------------------------
SENIOR DEBT PORTFOLIO
By: Boston Management and Research, as
Investment Advisor
By /s/
------------------------------------
Title Vice President
------------------------------
PILGRIM PRIME RATE TRUST
By /s/ Xxxxxxx X. Xxxxxxxx
------------------------------------
Title Xxxxxxx X. Xxxxxxxx
------------------------------
Vice President
XXX XXXXXX AMERICAN CAPITAL PRIME RATE
INCOME TRUST
By /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Title Xxxxxxx X. Xxxxxxx
------------------------------
Sr. Vice Pres.-Portfolio Mgr.
-6-
135
EXHIBIT A
CONFIRMATION
Dated as of May 17, 1996
To: Bank of America National Trust and Savings Association, as Agent, and
the other financial institutions party to the Credit Agreement referred
to below
Please refer to (a) the Credit Agreement dated as of October 6, 1995
among Fiberite, Inc., various financial institutions (the "Lenders") and Bank
of America National Trust and Savings Association, as Agent (the "Agent"); (b)
the Third Amendment dated as of May 17, 1996 to the Credit Agreement (the
"Third Amendment"); and (c) the Guaranty (the "Guaranty") dated as of October
6, 1995, executed by Fiberite Holdings, Inc. in favor of the Agent and the
Lenders.
The undersigned hereby confirms to the Agent and the Lenders that,
after giving effect to the Third Amendment and the transactions contemplated
thereby, the Guaranty and each other Loan Document (as defined in the Credit
Agreement) to which the undersigned is a party continues in full force and
effect and is the legal, valid and binding obligation of the undersigned,
enforceable against the undersigned in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
FIBERITE HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxx
---------------------
Title: Senior Vice President
---------------------
000
XXXXXX XXXXXXXXX AND WAIVER
THIS FOURTH AMENDMENT AND WAIVER dated as of January 29, 1997 (this
"Amendment") is among FIBERITE, INC. (the "Company"), various financial
institutions (the "Lenders") and BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent (the "Agent").
WHEREAS, the Company, the Lenders and the Agent have entered into a
Credit Agreement dated as of October 6, 1995 (as heretofore amended, the
"Credit Agreement"; unless otherwise defined herein, terms defined in the
Credit Agreement are used herein as defined in the Credit Agreement);
WHEREAS, the Company has entered into an agreement to acquire the
assets of the Composites Materials and Engineering Services Division of X.X.
xxXxxx de Nemours and Company for approximately $13.5 million on or about
January 31, 1997 (the "DuPont Acquisition");
WHEREAS, the Parent desires to make an initial Public Offering of its
common stock (the "Parent IPO") and to use certain of the net cash proceeds
thereof to prepay the Subordinated Notes and to contribute to the Company the
portion of the net cash proceeds thereof in excess of the amount required to
prepay the Subordinated Notes for the Company to use to prepay Loans; and
WHEREAS, the parties hereto desire to amend the Credit Agreement and to
waive certain provisions of the Credit Agreement, in each case as hereinafter
set forth;
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:
SECTION 1 AMENDMENTS. Effective on (and subject to the occurrence of)
the Fourth Amendment Effective Date (as defined below), (a) the definition of
"Net Worth" in Section 1.1 of the Credit Agreement shall be amended in its
entirety to read as follows:
Net Worth means the Company's consolidated stockholders' equity
plus all non-cash or non-recurring charges after the Closing Date
related to but not limited to the adoption of new accounting policies
and plant consolidations or restructurings and non-cash charges taken in
anticipation of the Parent IPO (as defined in the Fourth Amendment and
Waiver hereto dated as of January 29, 1997),
137
to the extent such charges were deducted in determining such
consolidated stockholders' equity.
and (b) Section 8.15 of the Credit Agreement shall be amended by adding the
following after the table therein:
; provided, however, that Capital Expenditures consisting of the
purchase price paid for the assets acquired pursuant to the DuPont
Acquisition (as defined in the Fourth Amendment and Waiver hereto dated
as of January 29, 1997) and closing costs and expenses in connection
with the DuPont Acquisition shall not be counted towards any limitation
on Capital Expenditures during any fiscal year pursuant to this Section
8.15 (it being understood that the maximum aggregate amount of Capital
Expenditures that may be so not counted under this proviso shall in no
event exceed $15,000,000).
SECTION 2 WAIVERS. Effective on (and subject to the occurrence of) the
Fourth Amendment Effective Date, the Lenders waive (a) any non-compliance with
Sections 7.13 and 8.4 of the Credit Agreement caused by the DuPont Acquisition
to the extent necessary to permit the DuPont Acquisition (including the use of
proceeds of Loans to finance the DuPont Acquisition) and (b) so long as the
DuPont Acquisition is consummated prior to the 90th day following the Company's
1996 fiscal year, the Company's obligation to prepay the Term Loans under
Section 2.7(f) of the Credit Agreement with respect to Excess Cash Flow from the
Company's 1996 fiscal year.
SECTION 3 REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to the Agent and the Lenders that: (a) the representations and
warranties made in Article VI of the Credit Agreement are true and correct on
and as of the Fourth Amendment Effective Date with the same effect as if made on
and as of the Fourth Amendment Effective Date (except to the extent such
representations and warranties expressly refer to an earlier date, in which case
they were true and correct as of such earlier date); (b) no Event of Default or
Unmatured Event of Default exists or will result from the execution of this
Amendment; (c) no event or circumstance has occurred since the Closing Date that
has resulted, or would reasonably be expected to result, in a Material Adverse
Effect; (d) the execution and delivery by the Company of this Amendment and the
performance by the Company of its obligations under the Credit Agreement as
amended hereby (as so amended, the "Amended Credit Agreement") (i) are within
the corporate powers of the Company, (ii) have been duly authorized by all
necessary corporate action, (iii) have received all necessary governmental
approval and (iv) do not and will not contravene or conflict with any provision
of law or of the charter or by-laws of the Company or of any indenture, loan
agreement or other contract, order or decree which is binding
-2-
138
upon the Company; and (a) the Amended Credit Agreement is the legal, valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms -- except -- as enforceability may be limited by applicable
bankruptcy, insolvency, or similar laws affecting the enforcement of creditors'
rights generally or by equitable principles relating to enforceability.
SECTION 4 EFFECTIVENESS. The amendments set forth in Section 1 above and
the waivers set forth in Section 3 above shall become effective on such date
(the "Fourth Amendment Effective Date") when the Agent shall have received (a) a
counterpart of this Amendment executed by each of the Lenders (or, in the case
of any party other than the Company from which the Agent has not received a
counterpart hereof, facsimile confirmation of the execution of a counterpart
hereof by such party), (b) with respect to each Lender that has executed a
counterpart hereof prior to 5:00 p.m. (New York time) on January 29, 1997, the
amendment fee separately agreed to between the Company and such Lender and (c)
each of the following documents, each in form and substance satisfactory to the
Agent:
4.1 Confirmation. A conformation from the Parent, substantially in the
form of Exhibit A hereto the "Confirmation").
4.2 Opinion of Counsel. An opinion of Xxxx, Xxxx, Xxxx & Freidenrich,
counsel to the Company and Parent, in Loan and substance satisfactory to the
Agent, as to the enforceability of this Amendment and the Confirmation against
the Company and Parent.
4.3 Other Documents. Such other documents as the Agent or any Lender may
reasonably request in connection with the Company's authorization, execution and
delivery of this Amendment.
SECTION 5 MISCELLANEOUS.
5.1 Continuing Effectiveness, etc. As herein amended, the Credit Agreement
shall remain in full force and effect and is hereby ratified and confirmed in
all respects. After the Fourth Amendment Effective Date, all references in the
Credit Agreement, the Notes, each other Loan Document and any similar document
to the "Credit Agreement," or similar terms shall refer to the Amended Credit
Agreement.
5.2 Counterparts. This Amendment may be executed in any number of
counterparts and by the different parties on separate counterparts, and each
such counterpart shall be deemed to be an
-3-
139
original but all such counterparts shall together constitute one and the same
Amendment.
5.3 Expenses. The Company agrees to pay the reasonable costs and
expenses of the Agent (including Attorney Costs) in connection with the
preparation, execution and delivery of this Amendment.
5.4 Governing Law. This Amendment shall be a contract made under and
governed by the internal laws of the State of New York.
5.5 Successors and Assigns. This Amendment shall be binding upon the
Company, the Lenders and the Agent and their respective successors and assigns,
and shall inure to the benefit of the Company, the Lenders and the Agent and
the successors and assigns of the Lenders and the Agent.
5.6 Parent IPO Proceeds. The Company agrees to give the Agent and the
Lenders ten Business Days' notice of the planned closing of the Parent IPO and
to prepay, within three Business Days of the closing of the Parent IPO, Loans in
an aggregate amount equal to the aggregate cash proceeds received by the Parent
in the Parent IPO net of the direct costs of such issuance (including, without
limitation, sales and underwriter's commissions and legal, accounting and
investment banking fees) ("Net Cash Proceeds") and, so long as no Event of
Default has occurred and is continuing, less the amount required for Parent to
prepay the Subordinated Notes. The aggregate amount of the prepayment of the
Loans under this Section 5.6 shall be at least $8,000,000 less, if the Parent
IPO closes after March 31, 1997, any increase in the accreted value of the
Subordinated Notes (as determined under the terms of the Subordinated Notes)
occurring after such date; provided, however, that in no event will the amount
of the prepayment under this Section 5.6 be less than $7,000,000. 50% of such
prepayment shall be applied to the Revolving Loans and 50% of such prepayment
shall be applied to the Term Loans and to the remaining installments thereof pro
rata; provided that if any Lender holding Term B Loans so requests, by notice to
the Agent not later than five Business Days prior to the date on which such
prepayment is due, the portion of such prepayment that would have been applied
to such Lender's Term B Loans shall be applied pro rata to the remaining
installments of the Term A Loans of all Lenders. The prepayment made pursuant to
this Section 5.6 shall be governed by the Credit Agreement in all respects. The
Lenders consent to the application of proceeds of the Parent IPO to prepay Loans
as set forth in this Section 5.6 and, so long as no Event of Default has
occurred and is continuing, to prepay the Subordinated Notes as set forth in the
recitals of this Amendment.
-4-
140
Delivered at New York, New York, as of the day and year first above
written.
FIBERITE, INC.
By /s/ X. X. Xxxxxx
--------------------------------------
Title Chief Financial Officer/Secretary
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent
By /s/
--------------------------------------
Title Vice President
BANK OF AMERICA ILLINOIS
By /s/
--------------------------------------
Title Vice President
DRESDNER BANK AG, LOS ANGELES AGENCY
AND GRAND CAYMAN BRANCH
By /s/
--------------------------------------
Title Vice President
By /s/
--------------------------------------
Title
THE BANK OF NOVA SCOTIA
By /s/
--------------------------------------
Title
-5-
141
BANQUE PARIBAS
By /s/ Xxxxxx X. X'Xxxxx
------------------------------------
XXXXXX X. X'XXXXX
Title Vice President
By /s/ Xxxxx X. Xxxx, III
------------------------------------
XXXXX X. XXXX, III
Title Vice President
DEUTSCHE BANK AG, NEW YORK AND/OR
CAYMAN ISLANDS BRANCHES
By /s/ Xxxxxx Xxxxxxxxx
------------------------------------
Title Assistant Vice President
By /s/ Xxxxxx X. Xxxx, Xx.
------------------------------------
Title Vice President
INDOSUEZ CAPITAL FUNDING II, LTD.
By: Indosuez Capital, as
Portfolio Advisor
By /s/ Xxxxxxxxx Xxxxxxxxx
-------------------------------------
Title Vice President
THE NIPPON CREDIT BANK, LTD.,
LOS ANGELES AGENCY
By /s/ Xxxxxxxx X. Xxxxxx
---------------------------------------
Title Vice President
-6-
142
SENIOR DEBT PORTFOLIO
By: Boston Management and
Research, as Investment
Advisor
By /s/ Xxxxxxx Xxxxxxxx
-----------------------------
Title Assistant Treasurer
--------------------------
PILGRIM PRIME RATE TRUST
By /s/ Xxxxxxx X. Xxxxxxxx
-----------------------------
Title Vice President
--------------------------
XXX XXXXXX AMERICAN CAPITAL PRIME
RATE INCOME TRUST
By /s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Title SR. Vice President
--------------------------
- 7 -
143
EXHIBIT A
CONFIRMATION
Dated as of January 29, 1997
To: Bank of America National Trust and Savings Association, as Agent, and the
other financial institutions party to the Credit Agreement referred to below
Please refer to: (a) the Credit Agreement dated as of October 6, 1995
among Fiberite, Inc. (the "Company"), various financial institutions (the
"Lenders") and Bank of America National Trust and Savings Association, as Agent
(the "Agent"); (b) the Fourth Amendment and Waiver dated as of January 29, 1997
to the Credit Agreement (the "Fourth Amendment"); and (c) the Guaranty (the
"Guaranty") dated as of October 6, 1995, executed by Fiberite Holdings, Inc. in
favor of the Agent and the Lenders.
The undersigned hereby confirms to the Agent and the Lenders that,
after giving effect to the Fourth Amendment and the transactions contemplated
thereby, the Guaranty and each other Loan Document (as defined in the Credit
Agreement) to which the undersigned is a party continues in full force and
effect and is the legal, valid and binding obligation of the undersigned,
enforceable against the undersigned in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency, or similar
laws affecting the enforcement of creditors' rights generally or by equitable
principles relating to enforceability.
The undersigned agrees that, upon the closing of the Parent IPO (as
defined in the Fourth Amendment), it will contribute to the Company the Net
Cash Proceeds (as defined in the Fourth Amendment) thereof less, if no Event of
Default has occurred and is continuing, the amounts required for the
undersigned to prepay the Subordinated Notes (as defined in the Credit
Agreement) and to cause the Company to use such contribution to prepay Loans
(as defined in the Credit Agreement) as provided in Section 5.6 of the Fourth
Amendment.
FIBERITE HOLDINGS, INC.
By: /s/ Xxx Xxxxxx
--------------------------
Chief Financial Officer
Vice President
